FRANKFURT- Siemens Healthineers’ operating income slipped 11% in the first quarter, despite higher revenue, as the German company sold less profitable imaging machines and incurred ramp-up costs for its new blood-testing machines.
The German maker of x-ray, ultrasound and MRI scanners said on Monday its adjusted earnings before interest and tax declined to 484 million euros (Ā£407.8 million) during the October-December period.
That was below average estimates of 568 million euros, according to a consensus posted on the company’s website.
First-quarter revenue rose 8.7% to 3.59 billion euros, slightly above expectations, the Siemens subsidiary said, adding that it has maintained its outlook for 2020 fiscal year through September, predicting growth in adjusted earnings per share of 6% to 12%.
“Profitability was negatively impacted by a temporary dip in Imaging and the guided weak margin performance in diagnostics,” the group said in a statement on Monday.
Ramp-up costs for a new line of blood- and urine-testing gear branded Atellica were inflated by the shipment of more than 600 analysers from July to September last year, the company added.
The health tech firm is pinning its hopes on Atellica automated testing machines to turn around its diagnostics division, which lags market leader Roche, but installation has proven more costly and time-consuming than initially hoped.
Faster growth is on the cards as Healthineers announced its largest Atellica order ever on Monday with U.S. lab operator Quest Diagnostics agreeing to purchase up to 120 Atellica analysers.
(Content and photos syndicated via Reuters)