NEW YORK (GenomeWeb News) – Agilent Technologies today reported revenues for its fiscal 2010 fourth quarter of $1.58 billion, up 35 percent from a year ago and surpassing analyst estimates of $1.52 billion.
A year ago, the company posted revenues $1.17 billion. Excluding the effects of the Varian acquisition and recent divestitures, revenues for the three months ended Oct. 31 were up 26 percent, the company said.
Total orders for the quarter rose 32 percent year over year to $1.69 billion from $1.27 billion a year ago.
In its Life Science Group, the company saw a 35 percent increase in revenues year over year to $431 million from $319 million. Organically, revenues increased 17 percent. Orders in the segment increased 33 percent to $468 million in the fourth quarter, compared to $352 million a year ago.
During a conference call after the release of the company's earnings, Agilent CEO William Sullivan cited a 31 percent increase in organic sales to the academic and government market.
"The academic market remains solid, particularly in light of US stimulus and growth in China," he said.
Nick Roelofs, president of the Life Science Group, added on the call that there was unexpected growth in sales to the academic market during the fourth quarter, especially in France, Germany, and Switzerland.
Sales to the pharmaceutical/biotechnology market rose 14 percent year over year, with investments "lighting up" in parts of Asia, such as India and Korea, Roelofs said. The company, he added, "was a little positively surprised this quarter at pharma strength in the US."
Pharma in Europe continued to be soft, but, Roelofs said, pharma/biotech have started their instrument replacement cycle "and we're going to see replacement in G-8 countries from big pharma." He added, "This was a hot quarter, but we think it's going to be a pretty good year for us in our space in pharma."
In the Life Science Group, platform sales rose in the double digits, including a 21 percent growth in liquid chromatography products, led by sales of Agilent's 1290 system. LC-MS and genomics products, including its Sure Select products "continued to perform very well," Sullivan said, though he did not elaborate.
In the firm's other two business segments, Chemical Analysis revenues rose 73 percent year over year, or 17 percent organically, to $389 million from $225 million in the fourth quarter of 2009, and Electronic Measurement grew 23 percent, 35 percent excluding the effects of the divestiture of its Network Solutions business, to $764 million from $623 million.
In May, Agilent completed its $1.5 billion acquisition of Varian. The company reported today progress on integration efforts and raised its projection on cost synergy savings to $100 million from an earlier estimate of $75 million.
"The big long-term issue … is to take the additional R&D spending that we're making to be able to expand and to upgrade the Varian platform in conjunction with our effort to reduce the cost of sales," to Agilent standards, Sullivan said.
The firm's R&D spending for the fourth quarter climbed 6 percent to $159 million from $150 million a year ago, while its SG&A costs rose 14 percent to $472 million from $413 million.
Agilent reported a profit of $232 million, or $0.66 per share, for the quarter, an 828 percent increase over $25 million, or $0.07 per share, from the fourth quarter of 2009. On a non-GAAP basis, EPS was $0.65, more than double $0.32 from a year ago, and ahead of analyst estimates of $0.60 per share.
During the fourth quarter, Agilent had Varian-related integration costs of $43 million, intangible amortization of $30 million, and restructuring charges of $18 million, the company said. It also recognized a tax benefit of $42 million, and a gain of $54 million from the closure of pre-Agilent spinoff income tax audits.
For full-year 2010, Agilent reported revenues of $5.44 billion, up 21 percent from $4.49 billion in fiscal-year 2009. Its profit for the year was $624 million, or $1.77 per share, compared to a net loss of $31 million, or $.09 per share, for 2009.
For fiscal 2011, the company raised its guidance to revenues of between $6.1 billion and $6.3 billion, and non-GAAP EPS of between $2.30 and $2.50. The mid-point of $6.2 billion in revenues would represent a 13 percent year-over-year growth, said Didier Hirsch, Agilent's CFO. The mid-point of $2.40 EPS would represent 20 percent growth year over year.
The company gave guidance a quarter ago of revenues between $5.9 billion and $6.2 billion and non-GAAP EPS of between $2.15 and $2.50.
For the first quarter of 2011, Agilent gave revenue guidance of between $1.53 billion and $1.55 billion and EPS of $0.55 to $0.57. The mid-point of its revenue guidance would represent 27 percent growth year over year. The mid-point of its EPS guidance would represent 47 percent growth year over year, Hirsch said.
As of Oct. 31, Agilent had $2.65 billion in cash and cash equivalents, with another $1.55 billion in short-term restricted cash and cash equivalents.