Alere Q2 Results Miss Estimates, But Loss Narrows

(RTTNews) - Medical devices maker Alere, Inc. (ALR) reported Monday a net loss for the second quarter that narrowed from last year, despite revenue decline and lower margins, reflecting lower interest and other expenses, as well as tax benefit. Both adjusted earnings per share and quarterly revenues missed analysts' expectations.

"The second quarter was a period of significant transition for Alere. With the recently announced change in leadership, we are now narrowing our focus on our global leading rapid diagnostic business and pursuing opportunities with the highest potential for value creation," Interim CEO and Chief Operating Officer Namal Nawana said in a statement.

Nawana added, "This new strategic direction will center on Alere's core strengths in rapid diagnostics and our focus areas of infectious and cardiometabolic disease and toxicology, which will enhance our ability to deliver more consistent and improved financial results."

Nawana was named to the positions after CEO, President and director Ron Zwanziger resigned from the positions in the firm in early July.

The Waltham, Massachusetts-based company reported a net loss available to common stockholders of $54.96 million or $0.67 per share for the second quarter, narrower than $65.88 million or $0.81 per share in the prior-year quarter.

Excluding special items, adjusted net income for the quarter was $35.61 million or $0.42 per share, compared to $54.57 million or $0.64 per share in the year-ago quarter.

On average, eight analysts polled by Thomson Reuters expected the company to report earnings of $0.58 per share for the quarter. Analysts' estimates typically exclude special items.

Net revenues for the quarter declined to $737.94 million from $763.99 million in the same quarter last year, and adjusted revenues were $738.32 million, compared to $764.58 million last year. Nine Wall Street analysts had a consensus revenues estimate of $747.55 million for the quarter.

Net product sales and services revenue declined to $731.34 million from $759.12 million, while license and royalty revenue improved to $6.60 million from $4.87 million a year ago.

Net revenues from professional diagnostics declined 3 percent to $583.37 million, and health information solutions revenues dropped 7 percent to $125.82 million from last year.

Gross margin, or percentage of revenues left after subtracting production costs, contracted 420 basis points to 46.1 percent from last year's 50.3 percent.

Net interest and other income expenses declined to $49.53 million from $91.39 million last year. The company reported an income tax benefit of $6.61 million, compared to an income tax provision of $17.87 million a year ago.

ALR closed Friday's regular trading session at $39.95, up $0.29 on a volume of 1.45 million shares.