(Reuters) – Zoetis Inc on Thursday reported weaker-than-expected sales in its largest business unit as distributors de-stocked on pet products.
The veterinary drugmaker reported pet products revenue of $1.23 billion for the first quarter, below analysts’ estimates of $1.4 billion, according to Refinitiv.
Zoetis sought to allay investor concerns over a hit to pet product sales from inflation and staffing shortages at pet clinics, saying that the quarterly miss was due to “short-term” factors and that demand from pet owners remained strong.
But its shares fell 3.4% to $171.71 in early trading.
The company, however, reiterated its annual forecast of adjusted profit between $5.34 and $5.44 per share and revenue in the range of $8.58 billion to $8.73 billion for the full year.
“We continue to see strong end-market demand in companion animal channels, based on data from veterinary clinics, retailers and pet owners,” said Chief Executive Officer Kristin Peck.
Analysts have said they expect trends in veterinary visit to improve this year amid the ongoing constraints in vet and animal hospital capacity.
The company, which sells medicines and vaccines to veterinary clinics and retailer for treatment of pet animals and livestock, reported overall revenue of $2 billion for the quarter, in-line with estimates of $2.012 billion, according to Refinitiv.
Excluding special items, the company reported a profit of $1.19 share, topping expectations of $1.26 per share.
(Reporting by Pratik Jain in Bengaluru; Editing by Shweta Agarwal)
