MILFORD, Mass.--(BUSINESS WIRE)--April 26, 2005--Waters Corporation (NYSE/WAT) reported today first quarter 2005 sales of $268.3 million, an increase of 5% over sales of $255.1 million in the first quarter of 2004 with a foreign currency translation benefit accounting for approximately 2% of that growth. Quarterly earnings per diluted share (E.P.S.) were $0.38, compared to $0.33 for the first quarter in 2004. On a non-GAAP basis, excluding a charge for patent litigation expense in the first quarter of 2004, adjusted E.P.S. grew approximately 3% from $0.37 in the first quarter of 2004 to $0.38 in the first quarter of 2005.
Commenting on the quarter, Douglas Berthiaume, Chairman, President and Chief Executive Officer said, "A decline in our business in Europe, slower growth in Asia and softer than anticipated global pharmaceutical spending tempered our growth in the first quarter. Sales to industrial customer segments for our Waters and TA Instruments Divisions grew at a healthy rate while ACQUITY UPLC(TM) and QTof Premier(TM) sales continued their positive momentum. Although sales and earnings growth rates for the quarter were weaker than we had anticipated in January, we are optimistic that stronger top-line growth will return as we move through the year."
As communicated in a prior press release, Waters Corporation will webcast its first quarter 2005 financial results conference call this morning, April 26, 2005 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 3, 2005, similarly by webcast and also by phone at 402-220-9772.
Waters Corporation holds worldwide leading positions in three complementary analytical technologies - liquid chromatography, mass spectrometry and thermal analysis. These markets account for $4.5 - $5.0 billion of the overall $20 + billion analytical instrument market.
This release contains "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 contained herein 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: reduced capital expenditures by our customers, in particular large pharmaceutical companies, loss of market share through competition, introduction of competing products, such as improved research-grade mass spectrometers, by other companies, 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 the healthcare market and the pharmaceutical industry, changes in distribution of the Company's products and foreign exchange fluctuations. Such factors and others are discussed more fully in the section entitled "Risk Factors" of the Company's Form 10-K for the year ended December 31, 2004, as filed with the Securities and Exchange Commission, which "Risk Factors" discussion is incorporated by reference in this press release. The forward-looking statements included in this press release represent the Company's estimates as of the date of this press release and should not be relied upon as representing the Company's estimates or views as of any date subsequent to the date of this press release. The Company specifically disclaims any obligation to update these forward-looking statements in the future.
Waters Corporation and Subsidiaries Consolidated Statements of Operations (In thousands, except per share data) (Unaudited) Three Months Ended April 2, April 3, 2005 2004 Net sales 268,305 255,086 Cost of sales 111,801 107,474 Gross profit 156,504 147,612 Selling and administrative expenses 80,595 71,427 Research and development expenses 16,747 16,071 Purchased intangibles amortization 1,282 1,354 Litigation provisions (A) - 7,847 Restructuring and other charges, net (B) - 104 Operating income 57,880 50,809 Interest income, net 364 231 Income from operations before income taxes 58,244 51,040 Provision for income taxes 11,649 10,195 Net income 46,595 40,845 Net income per basic common share $0.39 $0.34 Weighted average number of basic common shares 118,719 120,180 Net income per diluted common share $0.38 $0.33 Weighted average number of diluted common shares and equivalents 121,156 123,987 (A) The results for the three months ended April 3, 2004 include provisions of $7.8 million for ongoing patent litigation with Hewlett-Packard Company. (B) The results for the three months ended April 3, 2004 include restructuring and other incremental costs and adjustments recorded in relation to the Company's reorganization of the HPLC and mass spectrometry businesses. Waters Corporation and Subsidiaries Consolidated Statements of Operations (In thousands, except per share data) (Unaudited) Three Months Ended April 2, April 3, 2005 2004 Reconciliation of income per diluted share, in accordance with generally accepted accounting principles, with adjusted results: Income per diluted share $0.38 $0.33 -------- -------- Adjustment for litigation settlement, net of tax - 5,100 Income per diluted share effect - 0.04 -------- -------- Adjustment for restructuring and other charges, net of tax - 68 Income per diluted share effect - 0.00 -------- -------- Adjusted income per diluted share: $0.38 $0.37 ======== ======== 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 those items management has excluded as non- operational activities or transactions. Management feels these transactions are not indicative of understanding the ongoing operations of the business or its future outlook. Waters Corporation and Subsidiaries Condensed Consolidated Balance Sheets (In thousands and unaudited) April 2, December 31, 2005 2004 Cash and cash equivalents 586,912 539,077 Accounts receivable 239,634 271,731 Inventories 148,140 139,900 Other current assets 22,749 23,176 Total current assets 997,435 973,884 Property, plant and equipment, net 137,364 135,908 Other assets 347,562 350,634 Total assets 1,482,361 1,460,426 Notes payable and debt 335,935 206,663 Accounts payable and accrued expenses 277,924 286,327 Total current liabilities 613,859 492,990 Other long-term liabilities 289,913 288,750 Total liabilities 903,772 781,740 Total equity 578,589 678,686 Total liabilities and equity 1,482,361 1,460,426
Gene Cassis, 508-482-2349
Vice President of Investor Relations