Bio-Techne misses quarterly estimates on persistently weak demand in China

Feb 1 (Reuters) - Bio-Techne missed second-quarter earnings estimates on Thursday, hurt by persistently weak demand for its products used in the development of drugs and therapies, especially in key market China.

The life sciences company had missed revenue and profit estimates in the previous two quarters as well, as higher interest rates led to reduced research and drug development funding for smaller biotech clients, impacting demand in China.

Its second-quarter revenue came in at $272.6 million, missing analysts’ average estimate of $277.5 million, according to LSEG data.

It also narrowly missed the profit estimate of 41 cents per share, posting an adjusted profit of 40 cents per share for the second quarter.

The company had said in its earnings call last quarter that Chinese government funding for research at hospitals and academic institutions was significantly lower and it was hard to tell when it would stabilize.

Bio-Techne said the impact of these factors during the quarter was more than the company initially expected. Greater China accounted for 10% of the company's total revenues in fiscal year 2023, ended June 30, according to latest regulatory filings.

Sales at the company's largest protein sciences unit, which makes biological compounds used in research, fell 3%, to $197.7 million.

Revenue from its diagnostics and genomics unit, which manufactures tools and compounds used to make therapeutics and vaccines, rose about 11%, to $75.4 million.

Larger peer Thermo Fisher forecast annual profit and revenue below Wall Street estimates on Wednesday and said it does not expect demand from China to improve this year. (Reporting by Sneha S K; Editing by Pooja Desai)