Life science company, Meridian Bioscience, Inc. (VIVO), recently slashed its outlook for fiscal 2010 (ending Sep 30, 2010) mainly due to a weaker-than-expected H1N1 season and lower C. difficile product revenues

The company now expects net sales in the range of $145 million – $153 million in fiscal 2010, down from the earlier guidance of $160 million – $165 million. Meridian expects earnings in the range of 70 – 80 cents, down significantly from the previous guidance of 90 – 95 cents. 

Following the guidance revision by the company, the Zacks Consensus Estimate for fiscal 2010 has gone down to 75 cents, well below the earlier estimate of 93 cents. 

Meridian also provided guidance for the second quarter of fiscal 2010. The company expects to deliver earnings in the range of 13 – 15 cents on net sales of $30 million – $33 million. This reflects a sequential decline from the first quarter earnings of 22 cents. 

Revenues will also decline on a sequential basis as the company reported net sales of $42.45 million in the first quarter of fiscal 2010. Following the announcement of guidance for the second quarter, the Zacks Consensus Estimate for the quarter has gone down by 8 cents to 14 cents. 

Meridian reported that upper respiratory products, which increased by 83% during the twelve month period ending Dec 2009, dropped significantly during the second quarter mainly due to the end of the H1N1 pandemic in early December. 

The sudden end of the H1N1 pandemic has resulted in overstocking of flu related products across several laboratories which will affect demand in the coming season. 

Meanwhile, higher competition and a 5% decline in the overall C. difficile market affected C. difficile product revenues in the first half of fiscal 2010. C. difficile products contributed more than 25% to global diagnostics revenues in fiscal 2009. 

However, revenues from this segment should pick up with the launch of Meridian’s illumigene molecular C. difficile product later this year. Meridian intends to apply for US Food and Drug Administration (FDA) approval by Mar 22, 2010. Product launches could commence outside the US from the third quarter.
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