Veterinary sales lift Idexx 2Q profit 82 percent

Idexx Laboratories Corp. said Friday that its second-quarter profit rocketed 82 percent because sales of its veterinary products improved and profit margins increased.

The company, which makes water-purity tests in addition to animal diagnostics and pharmaceuticals, posted a profit of $39.4 million, or 63 cents per share, up from $21.7 million, or 34 cents per share, a year ago. Revenue rose 18 percent, to $280.6 million from $237 million.

Analysts expected an average of 56 cents per share in profit on $278.4 million in revenue, according to Thomson Financial.

Revenue from Idexx's companion animal group rose 19 percent to $230.8 million during the quarter. The company said sales of pharmaceuticals were strong, in part because it sold all its remaining inventory of its feline insulin product PZI VET.

Revenue from the water business rose 18 percent to $20.2 million, as higher sales of water-testing kits canceled out lower prices, and revenue from the production animal segment grew 15 percent to $21.5 million. The price of diagnostic tests also decreased in that business, but volumes increased.

Gross margins grew to 54 percent from 48 percent. Margins were hurt a year ago by a write-off of inventory and royalties for Navigator Paste, a treatment for a parasite that can damage the brain and spinal cord of horses.

The company raised its profit forecast for 2008 but trimmed the high end of its revenue expectations.

In morning trading, the stock fell $2.20, or 4.1 percent, to $52.05.