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Waters Corporation Reports 14% First Quarter 2007 Sales Growth

MILFORD, Mass.--(BUSINESS WIRE)--April 24, 2007--Waters Corporation (NYSE/WAT) reported today first quarter 2007 sales of $331 million, an increase of 14% over sales of $290 million in the first quarter of 2006. Foreign currency translation contributed 3% to this reported sales growth rate. On a GAAP basis, earnings per diluted share (E.P.S.) for the first quarter were $0.54, compared to $0.42 for the first quarter in 2006. On a non-GAAP basis, excluding a restructuring charge in the base period and the exclusion of purchased intangible amortization in both periods as noted in the attached reconciliation, E.P.S. grew 22% to $0.56 in the first quarter of 2007 from $0.46 in the first quarter of 2006.

Commenting on the quarter, Douglas Berthiaume, Chairman, President and Chief Executive Officer said, "The positive business momentum that we experienced in 2006 continued into the first quarter of 2007 and this strong start for 2007 is especially encouraging as the growth was generally broad-based and indicative of a very positive response to our newly introduced instrument systems and consumable products."

As communicated in a prior press release, Waters Corporation will webcast its first quarter 2007 financial results conference call this morning, April 24, 2007 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 through May 1, 2007, similarly by webcast and also by phone at 866-429-0575.

Waters Corporation holds worldwide leading positions in three complementary analytical technologies - liquid chromatography, mass spectrometry, and thermal analysis. These markets account for approximately $5.0 billion of the estimated $20 - $25 billion analytical instrumentation market.

                         CAUTIONARY STATEMENT

This release may contain "forward-looking" statements regarding future results and events, including statements regarding expected financial results, future growth and customer demand 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", "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, fluctuations in capital expenditures by the Company's customers, in particular large pharmaceutical companies, regulatory and/or administrative obstacles to the timely completion of purchase order documentation, introduction of competing products by other companies, such as improved research-grade mass spectrometers, and/or higher speed and/or more sensitive liquid chromatographs, pressures on prices from competitors and/or customers, regulatory obstacles to new product introductions, lack of acceptance of new products, other changes in the demands of the Company's healthcare and pharmaceutical company customers, changes in distribution of the Company's products, risks associated with lawsuits and other legal actions particularly involving claims for infringement of patents and other intellectual property rights, and foreign exchange rate fluctuations 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, 2006, as filed with the Securities and Exchange Commission (the "SEC"), 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
                Consolidated Statements of Operations
                (In thousands, except per share data)
                             (Unaudited)

                                                      (Unaudited)
                                                   Three Months Ended
                                                  March 31,   April 1,
                                                      2007      2006

Net sales                                            330,777  290,218
Cost of sales                                        143,232  120,628

  Gross profit                                       187,545  169,590

Selling and administrative expenses                   93,907   85,538
Research and development expenses                     18,722   19,043
Purchased intangibles amortization                     2,125    1,194
Restructuring and other unusual charges (1)                -    4,352

  Operating income                                    72,791   59,463

Interest expense, net                                 (6,835)  (6,136)
  Income from operations before income taxes          65,956   53,327

Provision for income taxes                            10,019    9,172

  Net income                                          55,937   44,155


Net income per basic common share                      $0.55    $0.42

Weighted average number of basic common shares       101,416  104,585


Net income per diluted common share                    $0.54    $0.42

Weighted average number of diluted common shares
 and equivalents                                     103,198  105,901


(1) The results for the three months ended April 1, 2006 include
 restructuring and other incremental costs in relation to a cost
 reduction plan implemented in February 2006.

                                                      (Unaudited)
                                                   Three Months Ended
                                                  March 31,   April 1,
                                                      2007      2006
Reconciliation of income per diluted share, in
 accordance with generally accepted accounting
 principles, with adjusted results:


Income per diluted share                               $0.54    $0.42
                                                  ----------- --------

Adjustment for purchased intangibles amortization,
 net of tax                                            1,638    1,007
Income per diluted share effect                         0.02     0.01
                                                  ----------- --------

Adjustment for restructuring and other unusual
 charges, net of tax                                       -    3,560
Income per diluted share effect                            -     0.03
                                                  ----------- --------

Adjusted income per diluted share:                     $0.56    $0.46
                                                  =========== ========


The adjusted 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. Management
 has excluded the restructuring charges and purchased intangibles
 amortization from its non-GAAP adjusted amounts since management
 believes that these charges are not directly related to ongoing
 operations thereby providing investors with information that helps to
 compare ongoing operating performance.
                 Waters Corporation and Subsidiaries
                Condensed Consolidated Balance Sheets
                     (In thousands and unaudited)


                                                March 31,   December
                                                   2007      31, 2006


Cash and cash equivalents                         503,686     514,166
Accounts receivable                               278,636     272,157
Inventories                                       177,684     168,437
Other current assets                               48,774      44,920
   Total current assets                         1,008,780     999,680

Property, plant and equipment, net                149,908     149,262
Other assets                                      469,616     468,371
   Total assets                                 1,628,304   1,617,313


Notes payable and debt                            371,504     403,461
Accounts payable and accrued expenses             242,267     282,373
   Total current liabilities                      613,771     685,834

Long-term debt                                    500,000     500,000
Other long-term liabilities                       139,725      69,096
   Total liabilities                            1,253,496   1,254,930

Total equity                                      374,808     362,383
   Total liabilities and equity                 1,628,304   1,617,313

    CONTACT: For Waters Corporation:
             Gene Cassis, 508-482-2349
             Vice President of Investor Relations

    SOURCE: Waters Corporation