Question-and-Answer Session
Operator
(Operator Instructions). Our first question comes from Mike Weinstein of JPMorgan. Your question please
Mike Weinstein - JPMorgan
Hi, guys, thank you for taking the questions. Let me start with the guidance commentary for the year. You had a good quarter here. Obviously, you topped your guidance for the first quarter. But you raised your guidance for the year momentarily, so I would like, if you could just give us a little bit more color on where that excess is coming from, obviously very strong gross margin, but if you could talk about within the business, the driver, your thoughts relative to balance of the year, thanks?
Bob Parkinson
Okay. That is pretty open ended, Rob why don’t you add on.
Rob Davis
Good morning. If you look at what we are really looking at for the full year, obviously it’s really a reflection of what you saw in the first quarter. Obviously as I highlighted, BioSience started the year very strong, which we are very pleased with. And we continue to expect good momentum in that business through the rest of the year. And I think, to Bob’s comments about the confidence we have despite some of the challenges we faced, it’s important to note that in first quarter and frankly for the full year, we were able to absorb the Heparin charge. We were able to absorb the lost revenue from COLLEGUE and the situation in (inaudible), which is really due more to a few large customer accounts, and that is what’s overall going on in that business, and still deliver on expectations and frankly little bit ahead of expectation for quarter. That is largely what’s going to carry to the full year. So, again for the full year it’s going to be BioScience strength, offsetting for the full year of COLLEGUE impact, as well as the weakness we do expect in the full year in our pharma partnering businesses and some benefit from foreign currency. So, that really is the driver of both the quarter and the full year guidance.
Bob Parkinson
Mike, I would just add to that, I think the theme is really one we've established -- and continued opportunity for margin improvement for the foreseeable future certainly, and it's driven by things we've talked about before. First of all business mix, it's encouraging that our BioScience business continues to do so well, it's a higher margin business as you know. So, as it grows faster than the other businesses, the profile benefits from that. But in addition, product mix within all the business units, the fastest growing categories right now, I think Medication Delivery and Renal to some degree are result of higher margin product categories. Productivity, which we continue to focus on, and pricing, and we continue to get pricing in most of our business, encouragingly in Medication Delivery as well as BioScience. So I think, as those elements continue to manifest themselves that continues to be, I think the basis for our confidence, as we look to the rest of the year.
- To read the full transcript on Seeking Alpha, click here »
