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Waters Corporation Third Quarter 1999 Sales Up 13%, Earnings Per Diluted Share Up 30%

MILFORD, Mass.--(BUSINESS WIRE)--Oct. 25, 1999--Waters Corporation (NYSE/WAT) reported today that third quarter 1999 sales increased by 13% over prior year levels. Currency effects were negligible. Earnings per diluted share (E.P.S.) were $0.43 for the quarter, representing a 30% increase over prior year E.P.S. of $0.33.

Douglas A. Berthiaume, Chairman and Chief Executive Officer, said: "Sales growth, earnings growth, cash flow performance and overall operating execution were all strong during this quarter. We also continue to be encouraged by the market response to our 1999 new product introductions. Consistent with the first half of the year, Company sales growth remained geographically broadbased."

Waters Corporation holds worldwide leading positions in three complementary analytical technologies-- high performance liquid chromatography, thermal analysis and mass spectrometry --which account for $3.5 billion in annual revenues of the $16 billion analytical instrument industry total.

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 interest rate and foreign exchange fluctuations. Such factors are discussed in detail in the Company's filings with the Securities and Exchange Commission. -0-

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                  Waters Corporation and Subsidiaries
                 Consolidated Statements of Operations
                 (In thousands, except per share data)
                              (Unaudited)

                                     Three Months       Nine Months
                                Ended September 30  Ended September 30
                                     1999     1998      1999    1998

Net sales                           171,090  151,793  503,732  439,829
Cost of sales                        61,903   57,832  186,237  165,600
Revaluation of acquired
 inventory (A)                            0        0        0   16,500
   Gross profit                     109,187   93,961  317,495  257,729

Selling, general and
 administrative expenses             57,075   49,276  167,116  151,216
Research and development expenses     8,634    8,512   26,341   25,130
Goodwill and purchased technology
 amortization                         1,999    2,537    6,078    7,043
  Operating income                   41,479   33,636  117,960   74,340

Interest expense, net                 1,794    4,416    7,206   14,367
   Income from operations
    before income taxes              39,685   29,220  110,754   59,973

Provision for income taxes           10,715    7,264   29,904   17,660
   Net income                        28,970   21,956   80,850   42,313

Less: preferred stock
 dividend and accretion                 247      241      736      720
   Net income available to
    common stockholders              28,723   21,715   80,114   41,593

Net income per basic common share      0.47     0.36     1.31     0.70

Net income per diluted common share    0.43     0.33     1.21     0.65

Weighted average number of basic
 common shares                       61,754   60,028   61,286   59,718

Weighted avg. number of diluted
 common shares and equivalents       66,611   64,822   66,223   64,412

    (A) Nonrecurring first quarter 1998 charge, no associated tax
effects

                  Waters Corporation and Subsidiaries
                 Condensed Consolidated Balance Sheets
                            (In Thousands)

                                          September 30,  December 31,
                                               1999          1998
                                            (Unaudited)

Cash and cash equivalents                       4,310       5,497
Accounts receivable                           131,188     136,806
Inventories                                    86,677      80,281
Other current assets                           31,467      29,040
   Total current assets                       253,642     251,624

Property, plant and equipment, net             90,190      89,029
Other assets                                  232,060     237,048
   Total assets                               575,892     577,701

Notes payable                                   3,840       4,259
Accounts payable and accrued expenses         174,666     181,314
   Total current liabilities                  178,506     185,573

Loans payable                                 112,975     218,250
Redeemable preferred stock                      9,794       9,058
Other liabilities                              13,570      14,701
   Total liabilities                          314,845     427,582

 Total equity                                 261,047     150,119
   Total liabilities and equity               575,892     577,701
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