Millipore Reports Second Straight Year of Strong Revenue and Earnings Growth.Company generates double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. annual revenue growth in both its Bioscience bioscience /bio·sci·ence/ (-si´ens) the study of biology wherein all the applicable sciences (physics, chemistry, etc.) are applied. bi·o·sci·ence n. See life science. and Bioprocess bi·o·proc·ess n. 1. A technique that produces a biological material, such as a genetically engineered microbial strain, for commercial use. 2. Divisions BILLERICA, Mass. -- Millipore Corporation For other uses, see Millipore. Millipore Corporation (NYSE: MIL) founded in 1954, listed among the S&P 500 since the early 1990s, is an international biosciences company, known widely for its micrometer pore-size filters and tests. (NYSE NYSE See: New York Stock Exchange :MIL), a leading provider of products and services that improve productivity and results in biopharmaceutical manufacturing and in clinical, analytical analytical, analytic pertaining to or emanating from analysis. analytical control control of confounding by analysis of the results of a trial or test. and research laboratories, today reported financial results for its fourth quarter and full year ended December 31, 2006. Revenues for the fourth quarter grew 49 percent, totaling $383.1 million. Changes in foreign exchange rates during the quarter increased total revenue growth by 4 percent. Excluding currency rate changes and revenues from the Company's acquisition of Serologicals, Millipore's total revenue growth in the fourth quarter was 9 percent, which included 12 percent growth in its Bioscience Division and 7 percent growth in its Bioprocess Division. For the full year, revenues grew 27 percent totaling $1.26 billion. Changes in foreign exchange rates increased total revenue growth by 1 percent during 2006. Excluding currency rate changes and revenues from the Company's acquisition of Serologicals, Millipore's total revenue growth in 2006 was 11 percent. This performance included 10 percent growth from Millipore's Bioscience Division and 12 percent growth from its Bioprocess Division. On a GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). basis, the Company reported fourth quarter net income of $18.5 million, or $0.34 per share. Non-GAAP net income grew approximately 50 percent in the fourth quarter to $49.1 million, or $0.90 per share, compared to non-GAAP net income of $32.7 million, or $0.62 per share in the fourth quarter of 2005. For the full year, Millipore reported net income of $97.0 million, or $1.79 per share. Non-GAAP net income for 2006 grew 24 percent to $164.9 million, or $3.04 per share. A reconciliation of all GAAP to non-GAAP financial measures is provided in the Company's financial tables accompanying this press release. "For the second year in a row we generated attractive revenue and earnings growth," said Martin Madaus, Chairman & CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Millipore. "The transformational changes we have implemented are driving higher-levels of performance throughout the organization and we have greatly expanded our future market opportunities through the acquisitions we completed in 2006. In the last two years, we have significantly improved our execution and increased the growth of both of our divisions, particularly our Bioscience Division which has doubled its adjusted currency growth rate since 2004. I am very proud of our employees who have delivered these great results, even while acquiring and integrating four companies during this time. "In 2006, we successfully executed on several initiatives to increase our profitability, which enabled us to grow our non-GAAP earnings per share by 18 percent. These initiatives included reducing our manufacturing costs and increasing the efficiency of our supply chain, driving increased leverage from our SG&A investments, and completing accretive acquisitions Accretive Acquisition An acquisition that will increase the acquiring company's EPS. Notes: As they are expected to increase the acquiring company's future earnings, these acquisitions tend to be favorable for the company's market price. . As we move forward, we expect the balanced growth profile between both divisions will enable us to maximize our growth and profitability. Our focus this year will be on driving returns and generating cash flow from the substantial investments we made in 2006." 2006 Highlights * Generated second straight year of double-digit revenue growth, while meeting revenue and earnings targets * Bioscience Division performance driven by strong growth in laboratory water, successful new product launches, and execution of new go-to-market initiatives * Bioprocess Division performance driven by strong consumable A material that is used up and needs continuous replenishment, such as paper and toner. "The low-tech end of the high-tech field!" sales to its biopharmaceutical customers for filtration filtration: see sewerage; water supply. Filtration The separation of solid particles from a fluidsolids suspension of which they are a part by passage of most of the fluid through a septum or membrane that retains most of the solids and chromatography chromatography (krō'mətŏg`rəfē), resolution of a chemical mixture into its component compounds by passing it through a system that retards each compound to a varying degree; a system capable of accomplishing this is called a products * Since 2004, increased non-GAAP gross margins by 160 basis points and non-GAAP operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: by 290 basis points * Completed strategic acquisition of Serologicals to broaden Millipore's product portfolio into fast growing markets * Expanded disposable disposable Nursing adjective Referring to that which is discarded or disposed of noun An item used in health care-related Pt contact which is discarded after use–eg masks, gloves, gowns, needles, paper products, syringes, wipes. See Biohazardous waste. manufacturing solution with acquisition of Newport Bio Systems * Opened new $50 million R&D Center for Bioprocess Division [TABLE OMITTED] [TABLE OMITTED] 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 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 Investor relations The process by which the corporation communicates with its investors. section of the website and will also be available via telephone by dialing (800) 642-1687 or (706) 645-9291 and entering confirmation code: 6883087. The telephonic replay will be available beginning at 8:00 p.m. ET on February 1, 2007 until 8:00 p.m. ET on February 4, 2007. About Millipore Millipore is a leading provider of products and services that improve productivity and results in biopharmaceutical manufacturing and in clinical, analytical and research laboratories. The Company is organized in two operating divisions. Its Bioprocess Division helps pharmaceutical and biotechnology companies Top 100 Biotechnology Companies The following is a list of the top 100 biotechnology companies ranked by revenue. The first nine companies qualify for the list of the top 50 pharmaceutical companies. to optimize optimize - optimisation their manufacturing productivity, ensure the quality of drugs, and scale up the production of difficult-to-manufacture biologics. Its Bioscience Division helps optimize laboratory productivity and workflows by providing reagents, kits and other enabling technologies and products for life science research and development. Millipore has a deep understanding of its customers' research and manufacturing process needs, and offers reliable and innovative tools, technologies and services. The Company is part of the S&P 500 Index and employs approximately 5,800 employees worldwide. For additional information on Millipore Corporation, please visit its website at: www.millipore.com. Use of Non-GAAP Financial Measures The non-GAAP financial measures used in this press release - which are non-GAAP gross profit, non-GAAP gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. , non-GAAP operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. , non-GAAP operating margin, non-GAAP pre-tax income, non-GAAP net income, and non-GAAP diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of - exclude stock based compensation expense, costs related to our manufacturing consolidation strategy, severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when related to leadership changes and division consolidation, acquisition and financing expenses related to the acquisition of Serologicals, amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. , inventory fair value adjustments and in-process R&D write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. related to business acquisitions, retirement plan curtailment Curtailment The act of contracting or reducing operations of a company in the hope of bringing it financial or operational stability. This management technique is often used when a company has grown too fast and is unable to effectively manage its operations. charges and accrual accrual, n continually recurring short-term liabilities. Examples are accrued wages, taxes, and interest. for environmental site remediation costs, professional fees related to repatriation Repatriation The process of converting a foreign currency into the currency of one's own country. Notes: If you are American, converting British Pounds back to U.S. dollars is an example of repatriation. of foreign earnings, income tax effect of repatriation of foreign earnings under the American Jobs Creation Act and a change in tax valuation allowance. There are limitations in using non-GAAP financial measures as they are not prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting and may be different than 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 couple of 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 bioscience customers, becoming a strategic supplier in bioscience research markets, leading our industry in product quality and manufacturing effectiveness, becoming a magnet for talent, and doubling the value of the Company between 2004 and 2009. The financial impact of certain elements of these activities, particularly leadership changes, our manufacturing consolidation strategy, division consolidation, and acquisitions, are often large relative to our overall financial performance and most of the related charges are recorded in one or two financial quarters but not in other financial quarters, which can adversely affect the comparability of our results on a period-to-period comparable basis. In addition, certain activities, such as the significant costs associated with consolidating manufacturing facilities, business acquisitions, curtailment of retirement plan, environmental site remediation costs, professional fees and income tax expense related to the repatriation of foreign earnings under the American Jobs Creation Act, happen infrequently in·fre·quent adj. 1. Not occurring regularly; occasional or rare: an infrequent guest. 2. and the underlying costs associated with such activities impact a limited number of quarters significantly, but do not recur. As an example, the scope and scale of our manufacturing consolidation strategy was the largest in our history. When we complete this initiative, we will have closed eight manufacturing plants. Beginning in the first quarter of 2006, we excluded stock based compensation expense from our non-GAAP results. 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, 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 forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , 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, the inability to successfully integrate Serologicals or other acquired businesses; 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 new therapeutics therapeutics Treatment and care to combat disease or alleviate pain or injury. Its tools include drugs, surgery, radiation therapy, mechanical devices, diet, and psychiatry. ; limitations on cash flow 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 cell culture products using bovine bovine /bo·vine/ (bo´vin) pertaining to, characteristic of, or derived from cattle. bovine pertaining to, characteristic of, or derived from the ox or cattle, members of the family Bovidae. See also cattle. serum; the inability to realize the expected benefits of development, marketing, licensing and other alliances; competitive factors such as new membrane membrane, structure composed mostly of lipid and protein that forms the external boundary of cells and of major structures within cells. Membrane organization is based on a sheet two molecules thick—a double layer of lipids aligned with their long hydrocarbon or chromatography technology; the inability to achieve anticipated cost benefits of our supply chain initiative; risks relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc our concentration of principal manufacturing operations Manufacturing operations concern the operation of a facility, as opposed to maintenance, supply and distribution, health, and safety, emergency response, human resources, security, information technology and other infrastructural support organizations. ; the inability to utilize technology in current or planned products due to overriding (programming) overriding - Redefining in a child class a method or function member defined in a parent class. Not to be confused with "overloading". 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 Research funding is a term generally covering any funding for scientific research, in the areas of both "hard" science and technology and social science. The term often connotes funding obtained through a competitive process, in which potential research projects are evaluated and ; exposure to product liability claims; and difficulties inherent in transferring or outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. of manufacturing operations. Please refer to our filings with the SEC, including our most recent Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. , for more information on these and other risks that could cause actual results to differ. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] Non-GAAP Gross Profit and Gross Profit Margin The calculation of non-GAAP gross profit and gross profit margin is displayed in the above tables. Non-GAAP gross profit and gross profit margin exclude the costs related to our manufacturing consolidation strategy for the reasons described above in the introductory paragraphs of the "Use of Non-GAAP Financial Measures" section of this press release. Non-GAAP gross margin and gross profit margin exclude the amortization of intangible assets and acquired inventory fair value adjustments from business acquisitions because (1) the amounts are non-cash, (2) we can not influence the timing and amount of future expense recognition, and (3) excluding such expenses provides investors and management better visibility into the components of operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. . Non-GAAP gross profit and gross profit margin also exclude stock-based compensation expense because the accounting treatment on a year-over-year basis for option grants has changed with the adoption of Statement of Financial Accounting Standards ("SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System ") No. 123 (revised 2004), Share-based Payment ("SFAS 123R"). We implemented the new accounting standard using the modified prospective method, which does not allow for restatement Restatement A revision in a company's earlier financial statements. Notes: The need for restating financial figures can result from fraud, misrepresentation, or a simple clerical error. of prior period results and, accordingly, renders the year-over-year comparison not meaningful. In addition, non-GAAP gross profit and gross profit margin exclude the one-time acquisition and related integration expenses in connection with the acquisition of Serologicals because this is the largest acquisition in recent Millipore history. Non-GAAP Operating Income and Operating Margin The calculation of non-GAAP operating income and operating margin is displayed in the above tables. Non-GAAP operating income and operating margin exclude the amortization of intangible assets, acquired inventory fair value adjustments and in-process R&D write-off related to business acquisitions because (1) the amounts are non-cash, (2) we can not influence the timing and amount of future expense recognition, and (3) excluding such expenses provides investors and management better visibility into the components of operating expenses. The calculation of non-GAAP operating income and operating margin also exclude the costs related to our manufacturing consolidation strategy and severance related to leadership changes and division consolidation for the reasons described above in the introductory paragraphs of the "Use of Non-GAAP Financial Measures" section of this press release. Non-GAAP operating income and operating margin exclude stock-based compensation expense because the accounting treatment on a year-over-year basis for option grants has changed with the adoption of SFAS No. 123R. We implemented the new accounting standard using the modified prospective method, which does not allow for restatement of prior period results and, accordingly, renders the year-over-year comparison not meaningful. Non-GAAP operating income and operating margin exclude one-time acquisition and related integration expenses in connection with the acquisition of Serologicals because this is the largest acquisition in recent Millipore history. In addition, we have also excluded environmental site remediation costs, charges related to the curtailment of our retirement plan and professional fees related to repatriation of foreign earnings from the non-GAAP operating income and operating margin because these costs are significant and non-recurring for Millipore. Non-GAAP Pre-tax Income The calculation of non-GAAP pre-tax income is displayed in the above tables. Non-GAAP pre-tax income excludes bridge loan commitment fees in connection with the acquisition of Serologicals. The calculation of non-GAAP pre-tax income also excludes costs related to our manufacturing consolidation strategy; severance related to leadership changes and division consolidation; stock-based compensation expense; acquisition and integration expenses; amortization of intangible assets, acquired inventory fair value adjustments and in-process R&D write-off related to business acquisitions; retirement plan curtailment charges; environmental site remediation costs; and professional fees related to repatriation of foreign earnings for the reasons described for operating income and operating margin above. Non-GAAP Net Income The calculation of non-GAAP net income is displayed in the above tables. Non-GAAP net income excludes income taxes on repatriation of foreign earnings under the American Jobs Creation Act of 2004 and a change in tax valuation allowance because these are significant non-recurring items affecting the income tax provision. Because pre-tax income is included in the net income calculation, the net income calculation also excludes costs related to our manufacturing consolidation strategy; severance related to leadership changes and division consolidation; stock-based compensation expense; acquisition integration expenses and bridge loan commitment fees in connection with the acquisition of Serologicals; amortization of intangible assets, acquired inventory fair value adjustments and in-process R&D write-off related to business acquisitions; retirement plan curtailment charges; environmental site remediation costs and professional fees related to repatriation of foreign earnings for the reasons described for pre-tax income above. Non-GAAP Diluted Earnings per Share The calculation of non-GAAP diluted earnings per share is displayed in the above tables. Because net income is included in the diluted earnings per share calculation, the diluted earnings per share calculation excludes the amounts for costs related to our manufacturing consolidation strategy; severance related to leadership changes and division consolidation; stock-based compensation expense; acquisition integration expenses and bridge loan commitment fees in connection with the acquisition of Serologicals; amortization of intangible assets, acquired inventory fair value adjustments and in-process R&D write-off related to business acquisitions; retirement plan curtailment charges; and environmental site remediation costs; professional fees related to the repatriation of foreign earnings; income tax effect of the repatriation of foreign earnings under the American Jobs Creation Act of 2004 and a change in tax valuation allowance for the reasons described for net income above. |
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