Abbott profit forecast gets a lift from St. Jude integration

By Divya Grover

(Reuters) - Abbott Laboratories (NYSE: ABT) raised its full-year profit forecast as the company benefits from its St. Jude Medical acquisition, and said it was confident that the Alere purchase would close this year, sending its shares to a near two-year high.

Abbott first offered to buy Alere in February 2016, but the deal ran into trouble when issues related to the diagnostic maker's accounting and sales practices came to light. The company finally agreed to buy Alere in April for about $5.30 billion, down from its initial $5.80 billion offer.

Abbott Chief Executive Miles White, who in April called Alere "a bit of a fixer-upper", said on an earnings call on Thursday that he was "quite confident" that the deal would be completed this year.

White also said he expected to announce another asset sale in connection with the deal.

Meanwhile, Abbott, which reported second-quarter profit just ahead of analysts' estimates, is reaping the benefits of its integration of the $25 billion St. Jude acquisition.

Sales of St. Jude's devices, on a standalone basis, increased about 4 percent in the second quarter, White said.

Sales in Abbott's overall medical devices business surged about 89 percent to $2.60 billion on a reported basis, but cardiac rhythm management (CRM) product sales were weighed down by competition from MRI-compatible devices in the United States.

"It appears that Abbott continued to lose share to both Boston Scientific Corp (NYSE: BSX) and Medtronic Plc (NYSE: MDT) given its lack of MRI ICDs and battery issues," Needham analyst Mike Matson wrote in a client note.

Abbott is seeking MRI-conditional labeling from the U.S. health regulator for a clutch of CRM devices.

Global nutrition sales dipped 0.6 percent on a reported basis.

New products lifted pediatric nutrition sales in the United States, but international sales declined due to continuing challenging market conditions in China. Adult nutrition product sales fell due to rising competition.

Abbott on Thursday raised its full-year adjusted earnings from continuing operations by 3 cents to a range of $2.43 per share to $2.53 per share.

The company's shares were up 2.37 percent at $50.57 in afternoon trading.

The shares, which had gained 29 percent this year through Wednesday's close, touched a high of $50.83 earlier.

(Reporting by Divya Grover in Bengaluru; Editing by Sriraj Kalluvila)

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