By Sahil Pandey
Nov 2 (Reuters) – IDEXX Laboratories beat quarterly estimates and raised its annual profit and revenue forecast on Monday, betting that rising diagnostic use per visit and new product launches will sustain growth through softer veterinary clinic traffic.
Shares of the pet diagnostics maker climbed more than 19% in morning trading.
The results come as animal-health companies continue to monitor softer pet owner spending and fewer veterinary clinic visits following the pandemic pet adoption boom. Even so, IDEXX has pointed to rising diagnostic use per visit as a growth driver.
“What we’re really excited by is the continued quality of the visits,” CFO Andrew Emerson said. “By quality, we mean broadening the use of diagnostics, using diagnostics more frequently in the pets that are coming through the door.”
IDEXX said US same-store clinical visits fell an estimated 1.8% during the third quarter.
However, higher testing frequency and adoption of newer products such as its InVue Dx analyzer and CancerDx cancer-screening test for dogs helped recurring diagnostics revenue in its companion-animal business grow 9.6% in the United States.
CEO Mike Erickson said IDEXX’s growth was driven by innovation, commercial execution and greater use of diagnostics, rather than a rebound in veterinary visits.
William Blair analyst Ryan S. Daniels said IDEXX’s 11% growth in recurring companion-animal diagnostics revenue continued to represent a “marked premium” over overall veterinary clinic sales growth despite persistent visit headwinds.
(Reporting by Sahil Pandey in Bengaluru; Editing by Vijay Kishore)
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