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Agilent Q4 Revenues Up 9 Percent, Misses Analyst Estimates but Beats EPS Forecast

NEW YORK (GenomeWeb News) – Agilent Technologies' fiscal fourth quarter-revenues increased 9 percent year over year, the company reported after the close of the market on Tuesday.

The Santa Clara, Calif.-based firm said that for the three months ended Oct. 31, revenues increased to $1.73 billion from $1.58 billion, while orders rose 4 percent to $1.75 billion from $1.69 billion a year ago. Wall Street analysts had forecast revenues for the quarter of $1.75 billion.

On a conference call following the release of its earnings, Agilent President and CEO Bill Sullivan said that the firm missed its guidance due to the effects of currency.

By sector, Life Sciences revenues increased to $471 million from $431 million, a 9 percent increase year over year, or 6 percent organically, led by "strong demand" in the applied markets, Sullivan said. Within the segment, pharma was up 5 percent, while academia/government grew 4 percent.

On the call, Nick Roelofs, Agilent's President of the Life Sciences Group said that on a worldwide basis, academia/government is a "pretty healthy mid-single digit market," with particular strength in the emerging markets, while Europe "looks positive, believe it or not."

The US academic/government market, however, is "a real problem," with the National Science Foundation budget down about 2.4 percent, though the National Institutes of Health budget looks like it will be slightly up.

The effect of the weak US academic/government market on the Life Sciences was minimal, he said, however. Though the North American academic/government space was down in the teens in the fourth quarter, the segment "still had strong numbers," Roelofs said.

Life Science orders in the quarter increased 9 percent year over year to $509 million from $468 million a year ago.

In Agilent's other segments, Chemical Analyses revenues rose 4 percent to $405 million from $389 million a year ago, while orders grew 5 percent to $421 million from $401 million, and Electronic Measurement revenues climbed 12 percent to $855 million from $764 million. Orders grew .4 percent to $822 million from $818 million.

Companywide R&D spending in the quarter increased 3 percent to $163 million from $159 million a year ago, while SG&A costs fell 6 percent year over year to $445 million from $472 million.

Net income for the fourth quarter was $289 million, or $.82 per share, compared to $292 million, or $.83 per share a year ago. On an adjusted basis, EPS was $.84 and beat Wall Street estimates of $.81.

For full-year 2011, revenues reached $6.62 billion, up 22 percent from $5.44 billion, but short of analyst expectations of $6.65 billion. Orders grew 18 percent to $6.78 billion from $5.74 billion.

Agilent increased spending on R&D to $649 million, up 6 percent from $612 million, and upped SG&A costs 3 percent to $1.81 billion from $1.75 billion.

Profits for the year increased to $1.01 billion, or $2.85 per share, from $684 million, or $1.94 per share a year ago. On a non-GAAP basis, EPS of 2.95 beat analyst estimates of $2.91.

In 2011, the firm spent $55 million in acquisition and integration costs, compared to $102 million a year ago. Varian acquisition-related fair value adjustments fell to $9 million from $51 million a year ago.

The company finished the year with $3.53 billion in cash and cash equivalents.

For the fiscal first quarter of 2012, Agilent gave guidance of $1.65 billion to $1.67 billion in revenues, and $.67 to $.69 in adjusted EPS. For fiscal 2012, the company gave guidance of between $6.85 billion and $7.15 billion, with adjusted EPS of between $3 and $3.35.

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