NEW YORK (GenomeWeb) – Waters today reported that its fourth quarter revenues were up 4 percent compared to the year-ago period.
For the three months ended Dec. 31, 2018, Waters' total revenues increased to $715.0 million from $687.3 million in Q4 2017, besting the consensus analyst estimate of $702.8 million.
The effect of foreign currency translation decreased Q4 revenues by 1 percent, the company said.
On a conference call following the earnings release, Waters Chairman and CEO Christopher O'Connell said that broad-based growth, particularly among the company's pharma customers, drove sales in the quarter and throughout 2018.
Pharma sales were up 7 percent (in constant currency) on the quarter and 4 percent in 2018. Government and academic sales were up 2 percent in Q4 and 7 percent in 2018. Sales to industrial markets were up 2 percent in the quarter and up 1 percent in 2018.
Instrument platform sales grew 4 percent in Q4, while full-year sales were up 1 percent. Growth was led by demand for the company's standalone liquid chromatography systems, O'Connell said. Waters saw sluggish mass spec sales during 2018, but O'Connell said that in Q4 the company saw "increasingly positive signals in demand for our mass spec technologies," including "continued stabilization of our high-resolution mass spec portfolio."
Strong mass spec sales in Waters' pharma business was largely offset by weakness in biomedical research, O'Connell added.
He said the company plans to release a number of new mass spec instruments in 2019 and highlighted the recent launch of its BioAccord LC-MS platform, a high-resolution system intended for routine workflows in large molecule pharmaceutical development.
Waters' recurring revenues grew by 6 percent in Q4 and 6 percent in 2018.
Geographically, sales were up 9 percent in Asia during the quarter and 7 percent during 2018, driven in both cases by double-digit growth in China. In the Americas, revenues were up 6 percent on the quarter and 3 percent on the year, with US sales up 5 percent and 2 percent, respectively. European sales declined 1 percent on the quarter and were up 1 percent in 2018.
Waters posted net income for the quarter of $185.1 million, or $2.48 per share, compared to a net loss of $353.2 million, or $4.44 per share, in Q4 2017. The 2017 figure included a $550 million income tax charge related to the recent US tax reform bill. On an adjusted basis, the company reported EPS of $2.87, beating the consensus Wall Street estimate of $2.64.
R&D spending in the quarter was up 8 percent year over year to $38.1 million from $35.1 million, while SG&A costs fell 4 percent to $142.9 million from $148.4 million.
Revenues for full-year 2018 increased 5 percent year over year to $2.42 billion from $2.31 billion in 2017, beating the Wall Street estimate for revenues of $2.41 billion.
The effect of foreign currency translation boosted full year 2018 revenues by 1 percent.
Profits for the year were $593.8 million, or $7.71 per share, compared to $20.3 million, or $.25 per share, in 2017. Adjusted EPS was $8.29, beating the consensus analyst estimate of $8.07.
For full year 2018, R&D spending was $143.4 million, up 8 percent from $132.6 million in 2017. SG&A spending was down 1 percent to $536.9 million from $544.4 million the year before.
Waters ended the year with $1.74 billion in cash, cash equivalents, and investments.
For Q1 2019, Waters estimates adjusted EPS to be in the range of $1.65 to $1.75, CFO Sherry Buck said on the call. Adjusted EPS for full-year 2019 is anticipated to be between $9.20 and $9.45, she said. Analysts are expecting Q1 earnings of $1.73 per share, and full-year 2019 earnings of $9.21 per share.
In Tuesday morning trading on the New York Stock Exchange, shares of Waters were up 10 percent to $224.87.