Covidien sees rise in first-quarter sales

Covidien Ltd., which has 3,000 area employees in two Hazelwood-based business units operating as Mallinckrodt Inc., on Thursday reported a 9 percent gain in first-quarter net sales, to $2.3 billion from $2.1 billion a year ago. Higher volume sales and new product introductions in its medical devices and imaging solutions units drove the growth, it said.

Diluted earnings per share, excluding one-time charges and gains, was 59 cents in the quarter, down from 67 cents a year ago. Covidien, based in Bermuda, increased spending on research and development, selling and marketing.

The company’s reported first-quarter net income was 89 cents a share, including a one-time gain of 34 cents from a tax sharing agreement with former parent company Tyco International and Tyco Electronics; and charges of 4 cents a share for in-process research and development, restructuring and tax rate changes.

Covidien’s local imaging solutions unit had a quarterly sales increase of 14 percent, to $291 million; four percentage points of the increase were attributed to favorable currency exchange rates. Sales of radiopharmaceuticals and contrast agents grew at a double-digit pace, the company said.

The pharmaceutical products unit, also based in Hazelwood, reported a 2 percent drop in first-quarter revenue, to $221 million, due to lower sales of narcotic products. Covidien said it is selling a Phillipsburg, N.J.-based specialty chemicals business which had been part of the pharmaceutical segment and last year had revenue of $422 million.

Overall, the company boosted sales growth guidance for fiscal 2008, anticipating a rise in the range of 6 to 9 percent over last year, up from prior guidance for 4 percent to 6 percent improvement.