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| 8-K - FORM 8-K - WATERS CORP /DE/ | d286997d8k.htm |
Exhibit 99.1
For Immediate Release
Contact: Gene Cassis, Vice President of Investor Relations, 508-482-2349
Waters Reports Fourth Quarter 2011 Financial Results
Milford, Massachusetts, January 24, 2012 - Waters Corporation (NYSE/WAT) reported fourth quarter 2011 sales of $521 million, an increase of 8% from sales of $484 million in the fourth quarter of 2010. In the quarter, foreign currency translation was about neutral to sales growth. On a GAAP basis, earnings per diluted share (E.P.S.) for the fourth quarter were $1.51 compared to $1.36 for the fourth quarter of 2010. On a non-GAAP basis, including the adjustments in the attached reconciliation, E.P.S. grew 13% to $1.56 from $1.38 in the fourth quarter of 2010.
For the full year, sales for the Company were $1.85 billion, an increase of 13% over sales of $1.64 billion in 2010 with foreign currency translation adding about 3% to sales growth. E.P.S. for 2011 were $4.69 compared to $4.06 in 2010. On a non-GAAP basis, including adjustments in the attached reconciliation, E.P.S. grew 18% to $4.81 from $4.09 in 2010.
Commenting on the Company’s 2011 performance, Douglas Berthiaume, Chairman, President and Chief Executive Officer said, “Our positive business momentum continued nicely in the fourth quarter with relatively balanced strength highlighting the results. The fourth quarter completed a very successful 2011 for Waters with double-digit revenue growth, faster earnings growth and very impressive cash generation.”
As communicated in a prior press release, Waters Corporation will webcast its fourth quarter 2011 financial results conference call this morning, January 24, 2012 at 8:30 a.m. eastern time. To listen to the call, connect to www.waters.com, choose “Investor Relations” and click on the “Live Webcast”. A replay will be available through February 1, 2012 at midnight eastern time, similarly by webcast and also by phone at 203-369-1317.
CAUTIONARY STATEMENT
This release may contain “forward-looking” statements regarding future results and events, including statements regarding customer acceptance of our products, expansion of our business in Asia and spending by certain end-markets that involve a number of risks and uncertainties. For this purpose, any statements that are not statements of historical fact may be deemed forward-looking statements. Without limiting the foregoing, the words, “believes”, “anticipates”, “plans”, “expects”, “intends”, “suggests”, “appears”, “estimates”, “projects”, and similar expressions are intended to identify forward-looking
statements. The Company’s actual future results may differ significantly from the results discussed in the forward-looking statements within this release for a variety of reasons, including and without limitation, the impact on demand among the Company’s various market sectors from economic, sovereign and political uncertainties; increased regulatory burdens as the Company’s business evolves, especially with respect to the U.S. Securities and Exchange Commission, U.S. Food and Drug Administration, and U.S. Environmental Protection Agency, among others; shifts in taxable income in jurisdictions with different effective tax rates; the outcome of tax examinations or changes in respective country legislation affecting the Company’s effective tax rate; the ability to access capital and maintain liquidity in volatile financial market conditions; fluctuations in capital expenditures by the Company’s customers, in particular large pharmaceutical companies; the ability to sustain and enhance service and consumable demand from the Company’s installed base of instruments; regulatory and/or administrative obstacles to the timely completion of purchase order documentation; introduction of competing products by other companies and loss of market share; pressures on prices from competitors and/or customers; regulatory, economic and competitive obstacles to new product introductions; other changes in demand from the effect of mergers and acquisitions by the Company’s customers; environmental and logistical obstacles affecting the distribution of products; risks associated with lawsuits and other legal actions, particularly involving claims for infringement of patents and other intellectual property rights; the impact of changes in accounting principles and practices; and foreign exchange rate fluctuations potentially affecting translation of the Company’s future non-U.S. operating results. Such factors and others are discussed more fully in the section entitled “Risk Factors” of the Company’s annual report on Form 10-K for the year ended December 31, 2010 and quarterly report on Form 10-Q for the period ended October 1, 2011 as filed with the Securities and Exchange Commission, which “Risk Factors” discussion is incorporated by reference in this release. The forward-looking statements included in this release represent the Company’s estimates or views as of the date of this release report and should not be relied upon as representing the Company’s estimates or views as of any date subsequent to the date of this release.
Waters Corporation and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands and unaudited)
| December 31, 2011 | December 31, 2010 | |||||||
| Cash, cash equivalents and short-term investments |
1,281,351 | 946,419 | ||||||
| Accounts receivable |
367,085 | 358,237 | ||||||
| Inventories |
212,864 | 204,300 | ||||||
| Other current assets |
79,775 | 77,685 | ||||||
| Total current assets |
1,941,075 | 1,586,641 | ||||||
| Property, plant and equipment, net |
237,095 | 215,060 | ||||||
| Other assets |
544,035 | 525,969 | ||||||
| Total assets |
2,722,205 | 2,327,670 | ||||||
| Notes payable and debt |
290,832 | 66,055 | ||||||
| Accounts payable and accrued expenses |
311,031 | 319,795 | ||||||
| Total current liabilities |
601,863 | 385,850 | ||||||
| Long-term debt |
700,000 | 700,000 | ||||||
| Other long-term liabilities |
194,793 | 173,023 | ||||||
| Total liabilities |
1,496,656 | 1,258,873 | ||||||
| Total equity |
1,225,549 | 1,068,797 | ||||||
| Total liabilities and equity |
2,722,205 | 2,327,670 | ||||||
Waters Corporation and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
| (Unaudited) | (Unaudited) | |||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2011 | December 31, 2010 | December 31, 2011 | December 31, 2010 | |||||||||||||
| Net sales |
$ | 521,420 | $ | 483,578 | $ | 1,851,184 | $ | 1,643,371 | ||||||||
| Cost of sales |
204,243 | 189,253 | 730,493 | 653,303 | ||||||||||||
| Gross profit |
317,177 | 294,325 | 1,120,691 | 990,068 | ||||||||||||
| Selling and administrative expenses (1) (2) |
126,237 | 120,518 | 490,011 | 445,456 | ||||||||||||
| Research and development expenses |
23,707 | 22,867 | 92,347 | 84,274 | ||||||||||||
| Purchased intangibles amortization |
2,359 | 2,764 | 9,733 | 10,406 | ||||||||||||
| Operating income |
164,874 | 148,176 | 528,600 | 449,932 | ||||||||||||
| Interest expense, net |
(6,193 | ) | (3,317 | ) | (19,348 | ) | (12,069 | ) | ||||||||
| Income from operations before income taxes |
158,681 | 144,859 | 509,252 | 437,863 | ||||||||||||
| Provision for income taxes (3) |
21,534 | 18,255 | 76,284 | 56,100 | ||||||||||||
| Net income |
$ | 137,147 | $ | 126,604 | $ | 432,968 | $ | 381,763 | ||||||||
| Net income per basic common share |
$ | 1.54 | $ | 1.38 | $ | 4.77 | $ | 4.13 | ||||||||
| Weighted-average number of basic common shares |
89,324 | 91,583 | 90,833 | 92,385 | ||||||||||||
| Net income per diluted common share |
$ | 1.51 | $ | 1.36 | $ | 4.69 | $ | 4.06 | ||||||||
| Weighted-average number of diluted common shares and equivalents |
90,566 | 93,344 | 92,325 | 94,057 | ||||||||||||
| (1) | Included in selling and administrative expenses for the three and twelve months ended December 31, 2011 are costs of $2 million and $6 million, respectively, related to cost reduction plans, asset impairments related to certain Company facilities and acquisition costs related to a recent acquisition. |
Included in selling and administrative expenses for the three and twelve months ended December 31, 2010 are costs of $1 million and $4 million, respectively, related to cost reduction plans and asset impairments related to certain Company facilities.
| (2) | Included in selling and administrative expenses for the three and twelve months ended December 31, 2011 are costs of $2 million associated with a non-income tax audit provision. Included in selling and administrative expenses for the twelve months ended December 31, 2010 are costs of $3 million associated with a non-income tax audit settlement. |
| (3) | Included in the provision for income taxes for the twelve months ended December 31, 2011 is a tax benefit of $2 million related to the settlement of an audit. Included in the provision for income taxes for the twelve months ended December 31, 2010 is a net tax benefit of $8 million related to the reversal of a reserve for an uncertain tax position due to an audit settlement and a tax benefit of $2 million related to the resolution of a pre-acquisition tax exposure. |
Waters Corporation and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
| (Unaudited) | (Unaudited) | |||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2011 | December 31, 2010 | December 31, 2011 | December 31, 2010 | |||||||||||||
| Reconciliation of net income per diluted share, in accordance with generally accepted accounting principles, with adjusted results: |
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| Net income per diluted share |
$ | 1.51 | $ | 1.36 | $ | 4.69 | $ | 4.06 | ||||||||
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| Adjustment for purchased intangibles amortization, net of tax |
1,903 | 1,985 | 7,174 | 7,497 | ||||||||||||
| Net income per diluted share effect |
0.02 | 0.02 | 0.08 | 0.08 | ||||||||||||
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| Adjustment for restructuring costs, asset impairments and acquisition-related costs, net of tax |
1,084 | 374 | 4,307 | 2,584 | ||||||||||||
| Net income per diluted share effect |
0.01 | 0.00 | 0.05 | 0.03 | ||||||||||||
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| Adjustment for one-time tax benefits |
— | — | (1,617 | ) | (1,500 | ) | ||||||||||
| Net income per diluted share effect |
— | — | (0.02 | ) | (0.02 | ) | ||||||||||
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| Adjustment for reversal of income tax reserves upon audit settlement |
— | — | — | (7,581 | ) | |||||||||||
| Net income per diluted share effect |
— | — | — | (0.08 | ) | |||||||||||
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| Adjustment for non-income tax audit settlement and provision, net of tax |
1,291 | — | 1,291 | 2,197 | ||||||||||||
| Net income per diluted share effect |
0.01 | — | 0.01 | 0.02 | ||||||||||||
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| Adjusted net income per diluted share |
$ | 1.56 | $ | 1.38 | $ | 4.81 | $ | 4.09 | ||||||||
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The adjusted net income per diluted share presented above is used by the management of the Company to measure operating performance with prior periods and is not in accordance with generally accepted accounting principles (GAAP). The above reconciliation identifies items management has excluded as non-operational transactions, net of the effective applicable statutory tax rates. Management has excluded the purchased intangibles amortization, restructuring costs, asset impairments, acquisition-related costs, one-time tax benefits, reversal of income tax reserves upon audit settlement and non-income tax audit settlement and provision from its non-GAAP adjusted amounts since management believes that these items are not directly related to ongoing operations, thereby providing management and investors with information that may help them to compare ongoing operating performance.