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Waters, Disappointed, Reports Anemic Q3 Sales Growth; Tax Provision Causes Profit to Fall by Half

NEW YORK, Oct. 25 (GenomeWeb News) - Waters today said that third-quarter sales increased only 3 percent as a result of weaker-than-expected sales to large accounts.

 

The company had originally slashed its third-quarter sales growth projections to 3 percent from 8 percent on Oct. 14.

 

Total sales for the period ended Oct. 1 increased 3 percent to $273 million from $264.8 million year over year, Waters said. Foreign currency translation had a "negligible effect" this quarter.

 

"We are disappointed in our third quarter performance as sales of instruments to our largest pharmaceutical customers were weak due to delays and reductions in their capital spending plans," Douglas Berthiaume, chairman, president, and CEO of Waters, said in a statement. "Unfortunately, revenue growth associated with our new product initiatives was insufficient to offset this market weakness."

 

R&D spending in the period dipped slightly to $16.5 million from $15.7 million in the year-ago quarter.

 

Net income slid 50.5 percent to $25.7 million, or $.23 per basic share, from $51.9 million, or $.43 per basic share, year over year. A $24 million tax provision related to a dividend distribution was recorded during this quarter.

 

Waters said it had around $489 million in cash and equivalents as of Oct. 1.

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