Quest 3Q profit climbs due to lower one-time costs

Quest Diagnostics says profit rose 73 percent as testing volume held up and charges decreased

• On 8:44 am EDT, Tuesday October 20, 2009

MADISON, N.J. (AP) -- Medical laboratory operator Quest Diagnostics Inc. said its profit jumped 73 percent in the third quarter as the costs of a legal settlement came off its books.

Quest said its profit grew to $192.2 million, or $1.03 per share, from $110.8 million, or 57 cents per share in the third quarter of 2008. Analysts expected a smaller profit of 96 cents per share. A year ago, the company took charges of 25 cents per share to settle a federal investigation into its NID testing kit business. It took other charges totaling 5 cents per share.

Revenue rose 4 percent, to $1.9 billion from $1.83 billion, as testing revenue rose 4 percent and revenue per test also increased 4 percent. According to Thomson Reuters, analysts were expecting $1.89 billion.

Testing volume was unchanged overall, because high unemployment has led to lower demand for drug testing. Quest reported greater demand for cancer, sexually transmitted disease, allergy, and vitamin D tests.

The company raised its profit forecast for the full year.

In premarket trading, Quest shares rose $2.16, or 3.8 percent, to $58.87.