(Reuters) – Laboratory Corp of America Holdings missed estimates for quarterly profit on Tuesday, as its drug development unit struggled against curbs on animal imports, while a sharp fall in sales of COVID testing kits hurt its diagnostics business.
Contract research firms, which conduct drug development-related work for third parties, have been hit by constraints over the supply of non-human primates (NHP) after a Cambodian supplier was charged in connection with illegal imports into the United States.
The company had earlier this year estimated a hit to its revenue from supply issues of between $80 million and $100 million.
The North Carolina-based life sciences company reported $1.4 billion in revenue from its drug development business for the quarter ended March 31, compared with analysts’ estimate of $1.45 billion, according to Refinitiv IBES data.
Excluding items, Labcorp reported a profit of $3.82 per share in the quarter, below analysts’ average estimate of $3.96, according to Refinitiv data.
Its revenue dropped to $3.8 billion from $3.9 billion a year earlier.
Labcorp now expects revenue from core business to grow in the range of 9.5-11% for the year, compared with 8.5-10.5% growth estimated earlier.
COVID testing for the year is expected to fall between 80-90% from its previous estimate of 75-90%, the company said.
Labcorp now expects 2023 profit of $16.25 to $17.75 per share, compared with $16 to $18 per share estimated earlier.
The planned spinoff of clinical development business Fortrea remains on schedule for mid-2023, it added.
(Reporting by Mariam E Sunny in Bengaluru; Editing by Shweta Agarwal)
