Quest Diagnostics says costs related to job cuts and bad weather hurt profit in 1st quarter
By APWednesday, April 21, 2010
Job cuts and bad weather hit Quest 1Q profit
MADISON, N.J. — Medical laboratory operator Quest Diagnostics Inc. said Wednesday its profit fell 3 percent in the first quarter due to charges connected with job cuts, and business lost due to bad weather.
Quest said it earned $162.4 million, or 89 cents per share. That was down from $167.1 million, or 88 cents per share, a year ago. Leaving out 6 cents per share in costs related to staff cuts and 5 cents per share from severe weather during the quarter, the company earned about $1 per share. Revenue was unchanged at $1.81 billion.
Thomson Reuters says analysts were expecting a profit of 98 cents per share and $1.87 billion in revenue. Analyst estimates usually leave out one-time charges.
Quest said it cut about 500 jobs and cited weak results in some parts of its business. The company said it currently has around 43,000 employees and has several hundred jobs open.
Quest said clinical testing revenue fell 0.4 percent during the quarter. Revenue per test grew 2.3 percent, but the number of tests performed fell 2.6 percent. The company said severe weather reduced clinical testing revenue and volume by 1 percent.
It reported greater use of gene-based testing and “esoteric” testing, or test that required specialized personnel that are used when a physician suspects a specific condition.
Quest tweaked its annual profit and revenue estimates. Excluding one-time charges, it is expecting a profit of $4.10 to $4.30 per share. However, including the staff reduction and weather costs, it expects $4 to $4.20 per share. Previously the company had forecast a profit of $4.10 to $4.30 per share.
Quest now thinks its annual revenue will grow 1 percent to 2 percent, not 3 percent to 4 percent. The new total suggests it will report revenue of $7.53 billion to $7.6 billion, compared with its earlier estimate of $7.68 billion to $7.75 billion.
Analysts are expecting a profit of $4.22 per share and revenue of $7.7 billion.
In morning trading, Quest shares fell $1.82, or 3 percent, to $57.78.
