Douglas A. Berthiaume, Chairman and Chief Executive Officer, said: "Consistent with our mid-June update, second quarter sales growth slowed from recent historical levels principally in our mass spectrometry product line. Demand for our quadrupole time-of-flight mass spectrometry products grew very strongly during the quarter, reflecting expanding interest from proteomics customers. However sales of our triple quadrupole products were flat and sales of other mass spectrometry products declined, resulting from both difficult prior year comparisons and slowed customer purchase decisions, particularly within large pharmaceutical accounts. Our HPLC product line continued to perform well with growth in the low double digits. Thermal analysis sales were down slightly as the industrial chemical customer base for this product line continued to be weak. Although second quarter results didn't achieve our original expectations, our profitability and financial position remain substantial, and we are optimistic about our future business prospects. We anticipate steady improvement in sales growth rates and profitability going forward."
As communicated in a prior press release, Waters Corporation will webcast its second quarter 2001 financial results conference call this morning, July 24, 2001, at 8:30 a.m. eastern time. To listen to the call, connect to www.waters.com and access the investor relations section. A replay of the call will be available from today through July 30, 2001 similarly by webcast, and also by phone at 402-998-0680.
Waters Corporation holds worldwide leading positions in three complementary analytical technologies - high performance liquid chromatography, thermal analysis and mass spectrometry - which account for $4 billion in annual revenues of the $18 billion analytical instrument industry total.
CAUTIONARY STATEMENTCertain 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 Operations (In thousands, except per share data) (Unaudited) Three Months Ended Six Months Ended June 30 June 30 2001 2000 2001 2000 Net sales 206,803 197,408 407,835 377,610 Cost of sales 75,545 71,777 148,843 138,117 Gross profit 131,258 125,631 258,992 239,493 Selling, general and administrative expenses 67,169 61,060 133,076 121,455 Research and development expenses 11,741 10,557 22,779 20,919 Goodwill and purchased technology amortization 1,771 1,760 3,519 3,571 Operating income 50,577 52,254 99,618 93,548 Interest income (expense), net 1,151 (343) 2,637 (1,044) Income before income taxes 51,728 51,911 102,255 92,504 Provision for income taxes 12,415 13,506 24,542 24,051 Income before cumulative effect of change in accounting principle 39,313 38,405 77,713 68,453 Cumulative effect of change in accounting principle (A) -- -- -- (10,771) Net income 39,313 38,405 77,713 57,682 Income per basic common share: Net income before cumulative effect of accounting principle change 0.30 0.30 0.60 0.54 Cumulative effect of change in accounting principle (A) -- -- -- (0.09) Net income 0.30 0.30 0.60 0.45 Income per diluted common share: Net income before cumulative effect of accounting principle change 0.29 0.28 0.56 0.50 Cumulative effect of change in accounting principle (A) -- -- -- (0.08) Net income 0.29 0.28 0.56 0.42 Weighted average number of basic common shares 130,564 126,914 130,363 126,246 Weighted average number of diluted common shares and equivalents 137,564 136,222 137,785 135,720 (A) Effect at January 1, 2000 of adopting Securities and Exchange Commission Staff Accounting Bulletin #101, recorded in first quarter 2000 Waters Corporation and Subsidiaries Condensed Consolidated Balance Sheets (In Thousands) June 30, December 31, 2001 2000 (Unaudited) Cash and cash equivalents 134,514 75,509 Accounts receivable 162,315 167,713 Inventories 107,478 87,275 Other current assets 16,862 13,299 Total current assets 421,169 343,796 Property, plant and equipment, net 109,873 102,608 Other assets 245,080 245,941 Total assets 776,122 692,345 Notes payable 2,179 4,879 Accounts payable and accrued expenses 226,264 215,654 Total current liabilities 228,443 220,533 Other liabilities 19,905 20,031 Total liabilities 248,348 240,564 Total equity 527,774 451,781 Total liabilities and equity 776,122 692,345
CONTACT: Waters Corporation Brian Mazar, Vice President of Investor Relations 508-482-2193