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Millipore Corporation. (2/2/10). "Press Release: Millipore Delivers Outstanding 2009 Financial Results. Company Delivers Double-digit Earnings Growth while Accelerating R&D Investments". Billerica, MA.
Millipore Corporation (NYSE:MIL), a leading provider of technologies, tools and services for the global life science industry, today reported financial results for its fourth quarter and full year ended December 31, 2009.
Revenues for the fourth quarter grew 7 percent from the previous year, totaling $426.0 million. Excluding a 5 percent benefit from changes in foreign currency, Millipore generated organic revenue growth of 2 percent. The Company's fourth quarter revenue growth was adversely affected by six fewer days in the quarter compared to the fourth quarter of 2008. On a divisional basis, excluding changes in foreign currency, Millipore's Bioprocess Division generated organic revenue growth of 4 percent, while Bioscience Division revenues were unchanged from the previous year.
Millipore's fourth quarter earnings per share attributable to Millipore were $0.78 per share, compared to $0.56 per share in the fourth quarter of 2008. Non-GAAP earnings per share were $1.00, compared to $0.95 per share in the fourth quarter of 2008. A reconciliation of GAAP to non-GAAP financial measures is provided in the Company's financial tables accompanying this press release.
For the full year 2009, Millipore's revenues grew 3 percent, totaling $1.65 billion. Excluding a 3 percent unfavorable impact from changes in foreign currency and a 1 percent contribution from acquisitions, the Company generated 5 percent organic revenue growth. On a divisional basis, excluding changes in foreign currency and acquisitions not in the base period, Millipore's Bioscience Division generated 2 percent organic revenue growth, while the Bioprocess Division grew 8 percent organically. Net income attributable to Millipore was $177.0 million, or $3.15 per share, in 2009, compared to $137.6 million, or $2.47 per share, in 2008, an increase of 28 percent. Non-GAAP net income for 2009 was $224.7 million, or $4.00 per share, resulting in 11 percent non-GAAP earnings per share growth over 2008.
"The resiliency of our business model and our strong execution enabled us to deliver excellent financial results in 2009 despite the challenges created by the global economic recession," said Martin Madaus, Chairman & CEO of Millipore. "We generated strong organic revenue growth, double-digit growth in earnings per share, and a 54 percent increase in our free cash flow. Our Bioprocess Division delivered outstanding performance as a result of strong demand from our biotechnology customers and higher levels of vaccine production. Additionally, our Bioscience Division grew faster than many of its peers due to its high exposure to consumable products and solid levels of spending from academic customers in all geographies.
"We made excellent progress against our goal of accelerating product innovation through internal R&D, partnerships, and strategic acquisitions. Our R&D spending increased by 12 percent in 2009; we successfully launched a number of innovative products; we initiated collaborations with several important technology partners; and we completed four acquisitions. All of these initiatives put us in a strong position and as we look ahead to 2010, we are confident in our ability to deliver attractive revenue growth, margin expansion, and strong cash flow. We expect our Bioprocess Division will benefit from continued demand from our global biotechnology customers, while our Bioscience Division will deliver improved performance as its end markets recover and it sees higher contributions from new products."
"The success of our initiative to improve our working capital efficiency was a significant driver of our record $298 million of free cash flow in 2009," said Charles Wagner, Chief Financial Officer of Millipore. "We also increased our non-GAAP operating margin by 80 basis points for the full year, while making substantial investments to fund our innovation strategy. The exceptional cash flow performance and margin expansion we have generated over the past five years reflect substantial underlying improvements in our operations and the attractiveness of our consumables-driven business model."
" Bioprocess Division generated 8 percent organic revenue growth. The division grew in all geographies and generated double-digit growth for its Downstream Bioprocessing products due to strong performance from large biotechnology customers.
" Bioscience Division generated 2 percent organic revenue growth. The performance was highlighted by solid demand for the division's Life Science products, including multiplex immunoassays, flow cytometry instruments and kits, and products used in neuroscience research. Despite a difficult environment for laboratory instrumentation sales, the division's Laboratory Water products still generated organic growth in 2009.
" The Company acquired Guava Technologies to expand its offering into benchtop flow cytometry instruments and kits and BioAnaLab to extend its biopharmaceutical services offering to the European market. Additionally, Millipore purchased the remaining 60 percent of its joint venture in India to expand its presence in the attractive Indian Life Science market and acquired the assets associated with Epitome Biosystems' Epitag technology to develop multiplex immunoassays for cell signaling.
" Delivered a strong year of new product launches, including several breakthrough innovations. In Bioprocess, the division launched Mobius(R) FlexReady disposable manufacturing solutions; Chromasorb(TM) single-use membrane adsorber; Mobius CellReady Disposable Bioreactor; and Viresolve(R) Pro, an innovative virus filtration product. In Bioscience, the division launched the guava easyCyte(TM) 8HT flow cytometry system; Scepter(TM), the world's first automated, handheld cell counter; and Milliplex(R) MAP Epiquant, multiplex cell signaling assays.
" Reported 19 percent organic growth in revenues derived from Brazil, Russia, India, China and Singapore (BRICS). The Company expanded its sales and service infrastructure in the region, including opening a new applications, training, and scale-up facility in Singapore.
" Generated $298 million of free cash flow, representing 54 percent growth over 2008. The Company improved its days sales outstanding by 7 days and its days of inventory by 11 days compared to 2008.
" Paid down $173 million of debt, including all borrowings under the Company's primary revolving credit facility.
Revenue Growth by Geography ($ millions):
Three Months Ended Twelve Months Ended
2009 December 31,
Growth December 31,
2009 December 31,
Americas $ 160.5 $ 159.6 1 % $ 660.0 $ 619.1 7 %
Europe 172.5 156.0 11 % 665.7 683.3 (3 %)
Asia/Pacific 93.0 81.2 15 % 328.7 299.7 10 %
Total $ 426.0 $ 396.8 7 % $ 1,654.4 $ 1,602.1 3 %
Revenue Growth by Division ($ millions):
Three Months Ended Twelve Months Ended
2009 December 31,
Growth December 31,
2009 December 31,
Bioprocess $ 232.0 $ 213.5 9 % $ 925.8 $ 880.8 5 %
Bioscience 194.0 183.3 6 % 728.6 721.3 1 %
Total $ 426.0 $ 396.8 7 % $ 1,654.4 $ 1,602.1 3 %
Quarterly Earnings Call
Millipore will host a conference call and webcast to discuss its financial results, business outlook, and related corporate and financial matters at 4:45 p.m. Eastern Standard Time today. The call can be accessed through Millipore's website: http://www.millipore.com. A replay of the call will be archived on the Investor Relations section of the website and will also be available via telephone by dialing 800-642-1687 or 706-645-9291 and entering confirmation code: 51960584. The telephonic replay will be available beginning at 5:45 p.m. Eastern Standard Time on February 2, 2010 until 11:59 p.m. Eastern Standard Time on February 9, 2010.
Millipore (NYSE: MIL) is a life science leader providing cutting-edge technologies, tools, and services for bioscience research and biopharmaceutical manufacturing. As a strategic partner, we collaborate with customers to confront the world's challenging human health issues. From research to development to production, our scientific expertise and innovative solutions help customers tackle their most complex problems and achieve their goals. Millipore Corporation is an S&P 500 company with more than 5,900 employees in 30 countries worldwide.
Use of Non-GAAP Financial Measures
The non-GAAP financial measures used in this press release are non-GAAP gross profit, gross profit margin, operating profit, operating margin, pre-tax income, net income attributable to Millipore, diluted earnings per share, and free cash flow. Non-GAAP gross profit, gross profit margin, operating profit, operating margin, pre-tax income, net income attributable to Millipore and diluted earnings per share exclude costs related to global supply chain initiatives, acquisition and related integration expenses, amortization of acquired intangible assets and inventory fair value adjustments related to business acquisitions, curtailment gain related to modifications to our postretirement benefit plan, gain on business acquisition, impairment of fixed assets, and non-cash interest expense on convertible debt. We define free cash flow as net cash provided by operating activities less additions to property, plant, and equipment. There are limitations in using non-GAAP financial measures as they are not prepared in accordance with generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies.
We believe that the non-GAAP financial measures provide useful and supplementary information to investors regarding our quarterly performance. It is our belief that these non-GAAP financial measures have been particularly useful to investors over the last few years because of the significant changes that have occurred outside of our day-to-day business in accordance with the execution of our new strategy. This strategy includes strengthening our leadership position with biopharmaceutical customers, becoming a strategic supplier in bioscience research markets, leading our industry in product quality and manufacturing effectiveness, and becoming a magnet for talent. The financial impact of certain elements of these activities, particularly acquisitions, are often large relative to our overall financial performance and most of the related charges are recorded in one or two fiscal quarters but not in other fiscal quarters, which can adversely affect the comparability of our results from period to period. Our global supply chain initiatives will significantly reduce our cost structure and improve operational efficiency primarily through the consolidation of manufacturing locations. Non-cash interest expense on convertible debt is the incremental interest expense as a result of a change in accounting principles.This interest expense is non-cash and we can not control the amount of this expense without modifying our capital structure. We believe free cash flow is a useful measure to evaluate our business as it indicates the amount of cash generated after additions to property, plant, and equipment that is available for, among other things, strategic acquisitions, investments in our business, and repayment of debt.
We regularly use non-GAAP financial measures internally to understand, manage, and evaluate our business results and make operating decisions. We also measure our employees and compensate them, in part, based on such non-GAAP measures. For the same reasons, we also use this information for our forecasting activities. The non-GAAP financial measures presented herein also facilitate comparisons to our historical operating results, which have consistently been presented in this manner.
Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. They are limited in value because they exclude charges that have a material effect on our reported results and, therefore, should not be relied upon as the sole financial measures to evaluate our financial results. The non-GAAP financial measures are meant to supplement, and to be viewed in conjunction with, GAAP financial measures. Investors are encouraged to review the reconciliation of the financial measures to their most directly comparable GAAP financial measures as provided in the tables accompanying this press release. Our earnings guidance, however, is only provided on a non-GAAP basis. It is not feasible to provide GAAP diluted earnings per share guidance because the items excluded, other than amortization expense and non-cash interest expense, are difficult to predict and estimate and are primarily dependent on future events.
Forward Looking Statements:
The matters discussed herein, as well as in future oral and written statements by management of Millipore Corporation that are forward-looking statements, are based on current management expectations that involve substantial risks and uncertainties which could cause actual results to differ materially from the results expressed in, or implied by, these forward-looking statements.
Potential risks and uncertainties that could affect Millipore's future operating results include, without limitation, failure to achieve design wins into our pharmaceutical and biotechnology customers' manufacturing design phase for a particular drug; delay, suspension or termination of a customer's volume production; lack of availability of raw materials or component products on a timely basis; regulatory delay in the approval of customers' therapeutics; limitations on cash flow available for operations and investment due to increased debt service obligations; the inability to establish and maintain necessary product and process quality levels; reduced demand for animal-derived cell culture products; the inability to realize the expected benefits of development, marketing, licensing and other alliances; competitive factors such as new membrane or chromatography technology; the inability to achieve anticipated cost benefits of our supply chain initiatives; risks relating to our concentration of principal manufacturing operations; the inability to utilize technology in current or planned products due to overriding rights by third parties; potential environmental liabilities; conditions in the economy in general and in the bioscience and bioprocess markets in particular; foreign exchange fluctuations; reduced private and government research funding; exposure to product liability claims; and difficulties inherent in transferring or outsourcing of manufacturing operations.Please refer to our filings with the SEC, including our most recent Annual Report on Form 10-K, for more information on these and other risks that could cause actual results to differ.
Record changed: 2016-03-19
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