Exhibit 99.1
For Immediate Release
Contact: Gene Cassis, Vice President of Investor Relations, 508-482-2349
Waters Corporation Reports Second Quarter Sales Growth of 6%
Milford, Massachusetts, July 25, 2006 — Waters Corporation (NYSE/WAT) reported today second quarter
2006 sales of $302 million, an increase of 6% over sales of $285 million in the second quarter of
2005. In the quarter, the effects of foreign currency translation did
not positively or negatively affect this sales growth rate. On
a GAAP basis, earnings per diluted share (E.P.S.) for the second quarter were $0.46, compared to
$0.46 for the second quarter in 2005. On a non-GAAP basis, including the adjustments noted in the
attached reconciliation, E.P.S. grew 15% to $0.53 in the second quarter of 2006 from $0.46 in the
second quarter of 2005.
Through the first six months of 2006, sales for the Company were $592 million, a 7% increase over
sales in the first six months of 2005 of $553 million. Without effects of foreign currency
translation, the Company’s organic sales growth rate was 9% as
currency translation reduced its reported sales growth rate by approximately 2%. E.P.S. through the first six
months of 2006 were $0.87 compared to $0.84 for the comparable period in 2005. On a non-GAAP basis
and including adjustments on the attached reconciliation, E.P.S. grew 21% in the first six months
of 2006 to $1.03 in 2006 from $0.85 in 2005.
Commenting on the quarter, Douglas Berthiaume, Chairman, President and Chief Executive Officer
said, “Our results in the second quarter indicate a continuation of the trends we experienced
earlier this year, including: continued expansion of businesses in China and India, strong
industrial spending and growing demand for ACQUITY UPLC™ technology. In the quarter, we also
introduced exciting new mass spectrometry instruments that we will begin shipping in the second
half of 2006. We were very encouraged by the excitement that these new systems generated at the
ASMS conference in late May and feel that the powerful combination of ACQUITY UPLC and new Waters mass
spectrometry technologies will help to further stimulate demand as we look to the remainder of 2006
and beyond.”
As communicated in a prior press release, Waters Corporation will webcast its second quarter 2006
financial results conference call this morning, July 25, 2006 at 8:30 a.m. eastern time. To listen
to the call, connect to www.waters.info, choose Investor Relations and click on the Live Webcast.
A replay of the call will be available through August 1, 2006, similarly by webcast and also by
phone at 203-369-0188.
Waters Corporation holds worldwide leading positions in three complementary analytical technologies
— liquid chromatography, mass spectrometry and thermal analysis.
These markets account for approximately $5.0 billion of the overall $20 — $25 billion analytical
instrument market.
CAUTIONARY STATEMENT
This release contains “forward-looking” statements regarding future results and events, including
statements regarding expected financial results, future growth and customer demand that involve a
number of risks and uncertainties. For this purpose, any statements contained herein that are not
statements of historical fact may be deemed forward-looking statements. Without limiting the
foregoing, the words, “believes”, “anticipates”, “plans”, “expects”, “intends”, “appears”,
“estimates”, “projects”, and similar expressions are intended to identify forward-looking
statements. The Company’s actual future results may differ significantly from the results discussed
in the forward-looking statements within this release for a variety of reasons, including and
without limitation, fluctuations in capital expenditures by the Company’s customers, in particular
large pharmaceutical companies, regulatory and/or administrative obstacles to the timely completion
of purchase order documentation, introduction of competing products by other companies, such as
improved research-grade mass spectrometers, and/or higher speed and/or more sensitive liquid
chromatographs, pressures on prices from competitors and/or customers, regulatory obstacles to new
product introductions, lack of acceptance of new products, other changes in the demands of the
Company’s healthcare and pharmaceutical company customers, changes in distribution of the Company’s
products, changes in the healthcare market and the pharmaceutical industry, loss of market share
through competition, potential product liability or other claims against the Company as a result of
the use of its products, risks associated with lawsuits and other legal actions particularly
involving claims for infringement of patents and other intellectual property rights, the short-term
impact to 2006 operating results from cost savings initiatives the Company implemented in February
2006, and foreign exchange rate fluctuations affecting translation of the Company’s future non-U.S.
operating results. Such factors and others are discussed more fully in the section entitled “Risk
Factors” of the Company’s annual report on Form 10-K for the year ended December 31, 2005 and
quarterly report on Form 10-Q for the period ended April 1, 2006, as filed with the Securities and
Exchange Commission (the “SEC”), which “Risk Factors” discussion is incorporated by reference in
this release. The forward-looking statements included in this release represent the Company’s
estimates or views as of the date of this release report and should not be relied upon as
representing the Company’s estimates or views as of any date subsequent to the date of this
release.
Waters Corporation and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
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(Unaudited) |
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(Unaudited) |
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Three Months Ended |
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Six Months Ended |
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July 1, |
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July 2, |
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July 1, |
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July 2, |
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2006 |
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2005 |
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2006 |
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2005 |
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Reconciliation of income per diluted share, in accordance with
generally accepted accounting principles, with adjusted results: |
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Income per diluted share |
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$ |
0.46 |
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$ |
0.46 |
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$ |
0.87 |
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$ |
0.84 |
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Adjustment for stock-based compensation, net of tax |
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5,111 |
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467 |
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10,724 |
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538 |
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Income per diluted share effect |
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0.05 |
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0.00 |
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0.10 |
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0.00 |
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Adjustment for restructuring and other unusual charges, net of tax |
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2,477 |
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— |
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6,037 |
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Income per diluted share effect |
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0.02 |
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— |
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0.06 |
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— |
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Adjusted income per diluted share: |
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$ |
0.53 |
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$ |
0.46 |
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$ |
1.03 |
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$ |
0.85 |
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The adjusted income per diluted share presented above is used by the management of the Company to measure operating
performance with prior periods and is not in accordance with generally accepted accounting principles (GAAP). The above
reconciliation identifies items management has excluded as non-operational transactions. As a result of the adoption of
FAS 123(R), management has excluded the stock-based compensation cost from its non-GAAP adjusted amounts to
enable management and investors to perform a meaningful comparison of the Company’s operating results to the prior
period. In the prior period, the Company’s consolidated statements of operations were not required to include the expense
associated with stock-based compensation and now the Company must include the expense in the consolidated statements
of operations. Management has excluded the restructuring charges from its non-GAAP adjusted amounts since management
believes that these charges are not directly related to ongoing operations thereby providing investors with information that
helps to compare ongoing operating performance.