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Waters Q4 Revenues up 6 Percent; Firm Acquires Megadalton Solutions

NEW YORK – Waters on Tuesday reported that its fourth quarter revenues were up 6 percent compared to the year-ago period, while full-year revenues were up 18 percent.

For the three months ended Dec. 31, 2021, Waters' revenues were $836.4 million, up 6 percent from $786.7 million in Q4 2020, and above the consensus Wall Street estimate of $821.0 million.

The effect of foreign currency translation decreased Q4 revenues by 2 percent, the company said.

Pharma sales were up 8 percent (in constant currency) in the quarter and up 19 percent in full year 2021. Government and academic sales were up 5 percent in Q4 and in full year 2021. Sales to industrial markets were up 7 percent in the quarter and up 15 percent in 2021.

Instrument platform sales were up 12 percent in Q4 and up 23 percent in full year 2021. Waters' recurring revenues grew by 3 percent in Q4 and 11 percent in 2021.

For Q4, Waters posted a net income of $216.2 million, or $3.52 per share, compared to a net income of $218.3 million, or $3.49 per share, in Q4 2020. On an adjusted basis, the company reported EPS of $3.67, up from $3.65 in Q4 of 2020, and beating the consensus Wall Street estimate of $3.47.

R&D spending in the quarter was up 9 percent year over year to $43.3 million from $39.7 million, while SG&A rose 13 percent to $173.0 million from $153.1 million.

Revenues for full-year 2021 were up 18 percent year over year to $2.79 billion from $2.37 billion in 2020, eclipsing the Wall Street estimate of $2.77 billion.

The effect of foreign currency translation boosted full year 2021 revenues by 2 percent.

Profits for the year were $692.8 million, or $11.17 per share, compared to $521.6 million, or $8.36 per share, in 2020. Adjusted EPS was $11.20, up from $9.05 in 2020, and beating the consensus analyst estimate of $11.02.

For full-year 2021, R&D spending was $168.4 million, up 20 percent from $140.8 million in 2020. SG&A spending was up 13 percent to $627.0 million from $553.7 million the year before.

Waters ended the year with $569.3 million in cash, cash equivalents, and investments.

For Q1 2022, Waters estimates constant currency revenue growth of between 6 percent and 8 percent and adjusted EPS in the range of $2.25 to $2.35. Revenue growth for full-year 2022 is expected to be between 5 percent and 7 percent, with anticipated adjusted EPS between $11.75 and $12.00. Analysts are expecting Q1 earnings of $2.38 per share, and full-year 2020 earnings of $11.78 per share.

Waters also announced the acquisition of charge detection mass spectrometry, or CDMS, firm Megadalton Solutions, a spinout from Indiana University based in Bloomington. CDMS is a tool for the characterization of large proteins and protein complexes difficult to analyze using conventional mass spec.

"Large molecule mass spectrometry with CDMS offers an important tool for the characterization, analysis and quantification of next-generation biologics, such as cell and gene therapies, which is an area of high interest among biopharmaceutical and biomedical research customers," Udit Batra, Waters' president and CEO, said in a statement. "Large molecules can be extremely challenging to characterize with conventional mass spectrometry because of their complexity. We are looking forward to further developing and commercializing the Megadalton CDMS technology to help customers analyze and quantify large molecules in applications such as cell and gene therapy drug development."

Financial and other terms of the deal were not disclosed.

In Tuesday morning trading on the New York Stock Exchange, shares of Waters were up 14 percent to $334.40.

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