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Waters Corporation First Quarter 2002 Sales Up 2% Before Currency Effects, Earnings Per Diluted Share Down 4% Before Patent Litigation Provision

MILFORD, Mass., Apr 23, 2002 (BUSINESS WIRE) -- Waters Corporation (NYSE/WAT) reported today that first quarter 2002 sales increased by 2% over prior year levels before unfavorable currency effects. After currency effects, reported sales growth was relatively flat with prior year. Earnings per diluted share (E.P.S.) were $0.27 for the quarter, before the after-tax impact of an additional patent litigation provision relating to the triple quadrupole product litigation, representing a 4% decrease over prior year E.P.S. of $0.28. Earnings after the patent litigation provision were $0.26 for the quarter.

Douglas A. Berthiaume, Chairman and Chief Executive Officer, said: "First quarter results were shy of our last sales expectation and were within the range of our last earnings expectation before a patent litigation provision. Cash flow continued to be strong in the quarter as we generated $39M of free cash flow. First quarter sales were impacted heavily by the unfavorable patent litigation ruling involving sales of certain mass spectrometry products in the United States. In addition, sales were negatively impacted by a strong U.S. dollar, delayed pharmaceutical customer spending at quarter end, and delayed product installations requiring deferral of revenue.

Our efforts to reengineer our mass spectrometry products affected by the unfavorable patent ruling, in order to resume their sales in the United States remain on track. We have begun limited shipments of certain Q-Tof Ultima(TM) products and plan to resume shipments of the full Q-Tof Ultima product line in the second half of 2002."

As communicated in a prior press release, Waters Corporation will webcast its first quarter 2002 financial results conference call this morning, April 23, 2002, at 8:30 a.m. eastern time. To listen to the call, connect to www.waters.info, choose Investor Relations and click on the Live Webcast. A replay of the call will be available from today through April 29, 2002 similarly by webcast, and also by phone at 402-220-5085.

Waters Corporation holds worldwide leading positions in three complementary analytical technologies - high performance liquid chromatography (HPLC), mass spectrometry (MS) and thermal analysis (TA). These markets account for $4.2 billion of the overall $19 billion analytical instrument market.

CAUTIONARY STATEMENT

Certain statements contained herein are forward looking. Many factors could cause actual results to differ from these statements, including loss of market share through competition, introduction of competing products by other companies, pressures on prices from competitors and/or customers, regulatory obstacles to new product introductions, lack of acceptance of new products, changes in the healthcare market and the pharmaceutical industry, changes in distribution of the Company's products, and foreign exchange fluctuations. Such factors are discussed in detail in the Company's filings with the Securities and Exchange Commission.

                 Waters Corporation and Subsidiaries
                 Consolidated Statements of Operation
                (In thousands, except per share data)
                             (Unaudited)
                                                  Three Months Ended
                                                      March 31
                                                  2002         2001
Net sales                                       200,341      201,032
Cost of sales                                    71,432       73,298
  Gross profit                                  128,909      127,734
Selling, general and administrative
 expenses                                        68,671       65,907
Research and development expenses                12,280       11,038
Patent litigation provision                       2,800         --
Goodwill and purchased technology
 amortization                                       915        1,748
  Operating income                               44,243       49,041
Interest income, net                              1,378        1,486
  Income from operations before
   income taxes                                  45,621       50,527
Provision for income taxes                       10,381       12,127
  Net income                                     35,240       38,400
Net income per basic common share                  0.27         0.30
Net income per diluted common share                0.26         0.28
Weighted average number of basic
 common shares                                  131,029      130,166
Weighted average number of diluted
 common shares and equivalents                  137,188      137,933
                  Waters Corporation and Subsidiaries
                 Condensed Consolidated Balance Sheets
                            (In Thousands)
                                               March 31,     Dec 31,
                                                 2002         2001
                                              (Unaudited)
Cash and cash equivalents                       250,761      226,798
Accounts receivable                             168,014      182,164
Inventories                                     109,731      102,718
Other current assets                             14,372       11,064
   Total current assets                         542,878      522,744
Property, plant and equipment, net              114,903      114,207
Other assets                                    273,018      249,960
   Total assets                                 930,799      886,911
Notes payable                                     1,614        1,140
Accounts payable and accrued expenses           288,697      279,866
   Total current liabilities                    290,311      281,006
Other liabilities                                24,780       24,160
   Total liabilities                            315,091      305,166
Total equity                                    615,708      581,745
   Total liabilities and equity                 930,799      886,911

CONTACT: Waters Corporation Brian Mazar 508-482-2193