EX-99.1 2 d422078dex991.htm EX-99.1

Exhibit 99.1

J.P. Morgan 41st Annual Healthcare Conference Udit Batra, Ph.D. President & CEO January 9, 2023

Cautionary Statements This For this presentation purpose, any contains statements forward that -looking are not statements statements regarding of historical future fact results may be and deemed events, forward including -looking financial statements and operational . Words guidance such as “may,” and projected “will,” “expect,” estimates “plan,” . “anticipate,” are intended “estimate,” to identify forward “intend,” -looking “outlook,” statements and similar . These expressions forward- (as looking well statements as other words may or include expressions statements referencing regarding future future events, operating conditions and financial or circumstances) and performance, assumptions market as of growth, the date success of this of presentation our products, and and are customer neither predictions trends. Forward nor guarantees -looking statements of future events in this or presentation performance are . You based should on Waters’ not place expectations undue reliance of any date on forward subsequent -looking to the statements, date of this which presentation speak only . Each as of of the these date forward hereof -looking and should statements not be relied involves upon risks as and representing uncertainties, the Company’s and actual estimates results may or differ views as materially forward-looking from such statements forward in -looking this presentation, statements including, . We discuss but various not limited factors to, those that may factors cause relating Waters to the actual impact results on Waters’ to differ operating from those results expressed throughout or implied the in the Company’s capabilities or various to our market supply sectors chain, volatility or geographies and uncertainty from economic, in global regulatory, capital markets sovereign limiting and our political ability uncertainties, to access capital including and foreign disruptions exchange in our rate manufacturing fluctuations potentially entitled “Forward affecting -Looking translation Statements”, of the Company’s “Management’s future non Discussion -U.S. operating and Analysis results, of as Financial well as Condition the impact and of the Results ongoing of Operations”, COVID-19 pandemic, and “Risk Factors” in the sections of the Company’s 2022, as updated Annual by Report the Company’s on Form 10 subsequent -K for the year filings ended with the December SEC, including 31, 2021 the as Company’s filed with the Quarterly Securities Reports and Exchange on Form 10 Commission -Q, as well (“SEC”) as the Company’s on February 2021 24, Annual information, Report future . Except events, as required or otherwise by law, . Waters does not assume any obligation to update or revise any forward-looking statements, whether as a result of new To constant supplement currency the revenue Company’s and financial non-GAAP statements earning per presented diluted share on a GAAP . Management basis, the uses Company these non has- GAAP provided measures certain non to evaluate -GAAP financial the Company’s measures, operating such as performance are important in in a comparing manner that current allows results for meaningful with prior period period- results to-period and comparison are useful and to investors analysis and of trends financial in its analysts business in .assessing Management the Company’s believes that operating such measures performance presented in .accordance The non-GAAP with financial GAAP. Management information presented strongly encourages here should investors be considered to review in conjunction the Company’s with, consolidated and not as a financial substitute statements for, the financial and publicly information filed reports measures in their used entirety in this .presentation The Company’s adjust definition for specified of these items non that -GAAP can be measures highly variable may differ or difficult from similarly to predict titled . Investors measures are used encouraged by others to . The review non the -GAAP reconciliation financial of GAAP these measures non-GAAP included measures in the to Appendix their most to directly this presentation comparable and GAAP which financial can also measures be found using on the a reconciliation company’s website of these at: measures https://ir.waters to the. com/ most. directly comparable ©2023 Waters Corporation

Key Messages Consistently Strong Execution Innovation Revitalized Adjacencies Gaining Traction

Waters at a Glance (NYSE:WAT) ï,§ Liquid chromatography, mass spectrometry, and thermal analysis innovator ï,§ Industry-leading service and informatics ï,§ Partner with customers around the world to ensure the: —Efficacy, safety & quality of medicines and vaccines —Purity of our food and water —Durability of products we use everyday Note: reconciliations 1. Based of on the trailing non- GAAP twelve -measures months (TTM) to the as most reported, directly GAAP comparable data for GAAP the period measures ended included October in 1, the 2022; Appendix 2. Operating of this Margin presentation = operating and available income divided on the Company’s by total revenues website (of at: $2 https://ir .95BN),. waters calculated .com/ using . adjusted Non-GAAP data. See Source: Waters Corporation data. ©2023 Waters Corporation 3

A Simple and Repeatable Business Model Note: Awards 1. for Total proven R&D excellence spending as and a percentage innovation in of Customer non-service Experience total company programs revenue . 3. According based on to trailing internal twelve analysis, -months ~80% (TTM) of the as reported, drugs filed GAAP with the data FDA for the and period EMA in ended 2021 October were done 1, 2022 so using . 2. Multiple our Empower ‘Achievement software in . Customer Excellence’ Source: differences Waters could data be material and estimates . Please . Installed refer to the base Company’s data are estimates Cautionary based Statements on internal . analysis. Forward-looking statements represented on this slide are subject to inherent uncertainties that could cause actual results to differ and such ©2023 Waters Corporation 4

High Exposure to Resilient, Growing Markets TOTAL ADDRESSABLE MARKET $12BN1 MSD GROWTH ~80% of Waters Revenues1 in Resilient Markets Note: statements Growth and rates are here subject reflect to inherent our internal uncertainties analysis of that historical, could cause long -actual term market results trend to differ data, and which such are differences subject to could future be changes material . .TAMs 1. Estimated and growth total rates addressable are estimates market based for analytical on internal instruments projections of ~ and $80BN; represent 2. Revenue forward data -looking is based on total Source: trailing Waters twelve data -month and estimates, (TTM) as reported, consulting GAAP data, revenues industry reports, for the period and market ended research October . 1, 2022 (100% = $2.95B) ©2023 Waters Corporation 5

With a Strong, Innovative Portfolio Waters Portfolio (Select Products Shown) Instruments Recurring Revenues Source: Waters Corporation data, analysis, and estimates. ©2023 Waters Corporation

Resulting in Industry-Leading Financials Note: publicly 1. reported Based on total calculations performance comparing or analytical Waters’ instrument 3-year average segment compound performance growth (depending rates from on year which -over is -the year most constant relevant currency comparison organic to sales Waters growth business), for the excluding first nine months COVID -of 19 2020, impacts 2021 . See and reconciliations 2022, with that of of the peers, non-GAAP based measures on their to margin the most percentage directly comparable with that of GAAP peers, measures based on included their publicly in the reported Appendix total of this performance presentation or analytical and available instrument on the segment Company’s performance website at: (depending https://ir.waters on which .com/ is . the 2. Based most relevant on calculations comparison comparing to Waters’ Waters’ business) FY-21. non 3. Based -GAAP on operating calculation comparing + long term Waters’ debt. 3 Source: -year average FactSet; ROIC Company with that public of peers, releases; based Waters on their data, publicly analysis, reported and estimates total performance . . ROIC is Return on Invested Capital, calculated as: ‘ROIC = (Non-GAAP EBIT *(1 – t))/invested capital; Invested capital = equity ©2023 Waters Corporation 7

Key Messages Consistently Strong Execution Innovation Revitalized Adjacencies Gaining Traction

Broad Strength in Our Results 2022 YTD (As Of 3Q22) Total: +14% Organic Revenue Growth in Constant Currency Y/Y Organic Sales Growth in Constant Currency (Year-To-Date As Of 3Q22) Portfolio Geography End Markets Instruments +19% Americas +17% Pharma +12% Service +9% Europe +10% Indust. & Applied +15% Chemistry +9% China +16% Acad. & Govt. +16% Asia (ex-China) +12% Note: A reconciliation of these non-GAAP measures to the most directly comparable GAAP measures is included in the Appendix of this presentation. Historical returns are not indicative of future performance. ©2023 Waters Corporation 9

Consistently Strong Execution Since Our Transformation... Organic Revenue Growth in Constant Currency Execution Scorecard (3-yr CAGR FY20-22 YTD As Of 3Q22) Portfolio Geography End Markets Instruments +10% Americas +9% Pharma +10% Recurring +8% Europe +9% Non-Pharma* +7% Asia +8% *Non-pharma = Industrial and A&G Note: comparable * YTD GAAP 3-yr CAGR measures = 3-year are average included compound in the Appendix growth of rates this presentation from year-over and -year are constant available currency on the Company’s sales growth website for the at: first https://ir nine months .waters .of com/ 2020, . Historical 2021 and returns 2022 .are Reconciliations not indicative of of the future non performance -GAAP measures . to the most directly ©2023 Waters Corporation 10

...Leading to Top-Quartile Results YTD Organic Sales Growth 1 3-yr CAGR FY20-22 YTD As Of 3Q22 publicly Note: 1. reported Based on total calculations performance comparing or analytical Waters’ instrument 3-year average segment compound performance growth (depending rates from on year which -over is -the year most constant relevant currency comparison organic to sales Waters growth business), for the excluding first nine months COVID -of 19 2020, impacts 2021 . Market and 2022, growth with rates that and of peers, historical based pricing on their trends reflect our internal analysis of long-term historical market trend data, which are subject to future changes. Historical results are not indicative of future performance. ©2023 Waters Corporation 11

Strong Contribution from Commercial Initiatives Commercial Initiatives Solid Progress Made with Long-Term Runway Ahead 1 Instrument Replacement Strong cadence established; lasting tailwind with ongoing replacement 2 Service Attachment +350bps since 2019; 650bps remaining vs +1000bps target 3 Contract Organizations CXO revs doubled since 2019; opportunity for further penetration 4 eCommerce Adoption ~35% Chemistry sales now digital vs. 21% in 2019; 55% target 5 Launch Excellence Product vitality index +600bps at ~15% vs ~9% in 2019 uncertainties Note: Data referenced that could on cause this slides actual represents results to differ a combination and such differences of historical could analysis be material based on . Historical internal Waters results estimates are not indicative and forward of future -looking performance statements . which are subject to inherent

Key Messages Consistently Strong Execution Innovation Revitalized Adjacencies Gaining Traction ©2023 Waters Corporation 13

New Products Solving Unmet Needs Launches during the Past Two Years Characterize biologics Robust QA/QC with by shape and mass 17x faster, 12x more Biologics testing, Supporting new more precision and speed Enabling large sensitive separation of new food safety, and battery testing demand 100x increase in molecule QA/QC biologics and novel environmental for electric vehicles sensitivity for Greater detection of low modalities applications biologics testing abundance compounds like PFAS Source: Waters Corporation data, analysis, and estimates. ©2023 Waters Corporation 14

Innovation Supporting Core Growth Opportunities ï,§ï Up to 15x better sensitivity1 ï,§ï Up to 45% smaller and up to 50% more power efficient2ï,§ï Data review time reduced by up to ~50% with waters_connect3 PFAS Testing Market New regulatory limits driving increased surveillance testing with greater detection requirements4 Significant global funding, including $10BN U.S. Federal grant to address PFAS and other emerging contaminants in water5 PFAS testing is a $200MM to $250MM global market, growing +20%6 Note: 4. https://www 1. Compared .chemeurope to its predecessor .com/en/whitepapers/1126847/detection system; 2. Compared to other- of high -per -performance -and-polyfluorinated tandem- alkyl quadrupole -substances mass -pfas spectrometers -in-environmental available -water on -the samples market; .html; 3 Using 5. From exception U.S. Infrastructure -focused review Investment feature in and quantitation Jobs Act of app 2022, on waters cited at _ connect; testing https://www market .whitehouse grew 20% .gov/briefing in 2022. Historical -room/statements results are -releases/2022/06/15/fact not indicative of future performance -sheet-biden .-harris-administration-combatting-pfas-pollution-to-safeguard-clean-drinking-water-for-all-americans/; 6. Based on Waters’ estimates, overall PFAS ©2023 Waters Corporation 15

Key Messages Consistently Strong Execution Innovation Revitalized Adjacencies Gaining Traction

Taking Capabilities into Faster-Growing Adjacencies Strong Core Position ï,§ï Pharma QA/QC ï,§ï Late-Stage Drug Developmentï,§ï Food and Environmental Safetyï,§ï Clinical Diagnosticsï,§ï Materials Testing Faster-Growing Adjacencies ï,§ï Bio-separations ï,§ï Bioanalytical Characterizationï,§ï LC-MS in Diagnosticsï,§ï Battery Testingï,§ï Sustainable Polymers HSD – DD Markets comprised Note: Market of growth consulting rates data, are industry Waters internal reports and estimates market based research on long which -term are historical subject to data change for more . This mature data also markets represents as well forward as current -looking and statements recent historical and are growth subject rate to data inherent for more uncertainties nascent, high that growth could cause markets actual . These results estimates to differ are and such differences could be material. Please refer to the Company’s Cautionary Statements. ©2023 Waters Corporation 17

High-Growth Adjacencies TAM Market Growth Growth Drivers Bio-separations1 $1.4BN 8-10% ï,§ï and Biologics volume and novel modality complexity Bioanalytical $1.8BN 10-12% ï,§ï Raw material, process development, and Characterization2 QA/QC testing of biologics and novel modalities LC-MS in Diagnostics $1.5BN 8-10% ï,§ï endocrinology, Volume of multiplex and drugs testing of for abuse oncology, testing Battery Testing3 $1.4BN 18-20% ï,§ï Electric vehicle manufacturing volume Sustainable Polymers4 $0.9BN 10-12% ï,§ï forms Conversion of 50% of polymers to sustainable $7.0BN 12% Note: industry Total reports Addressable and market Market research Sizing which (TAM) are and subject Market to growth change .rates This are data Waters also represents internal estimates forward- based looking on statements current and and recent are subject historical to inherent growth rates uncertainties data for markets that could that cause are nascent actual results . These to estimates differ and are such comprised differences of consulting could be data, Waters material Corporation . Please refer information to the Company’s and analysis Cautionary . 1. Includes Statements columns . Source: only Benchmark and not kits Mineral and reagents Intelligence; . 2. TAM IDTechEx ranges from , IQVIA, $700M Markets to $1. 8BN, & Markets, where SDi, $700M WoodMac, is LC-UV Company and LC- MS annual based, reports, and the press remainder releases, includes and earnings other technologies transcripts, and that are relevant $3B. $0. 9B in bioanalytical includes sustainable characterization polymer . -3 related . Includes thermal thermal, and mechanical microcalorimetry, analysis and as rheology well as segments, other technologies as well as used other for battery materials characterization testing. technologies. 4. Excludes other types of advanced materials, where total combined TAM is ©2023 Waters Corporation 18

Accelerating Bioanalytical Characterization 1 RAW MATERIALS 2 PROCESS 3 QA / QC FOR TESTING DEVELOPMENT BIOLOGICS Fingerprinting components Upstream and downstream Critical quality attributes Cell culture media testing bioprocess optimization measurement during production C U ST O M E R E X A M P L E S Implementing Process Analytical Technology “We use BioAccord to monitor metabolites, in bioprocessing Bringing in the specificity of mass spec into a nutrients and amino acids during cell culture quality environment. Using BioAccord to speed production of Biotherapeutics. The information up measurements and obtain higher quality from these assays help us make critical decisions data for biologics QA/QC testing, including on cell lines to support projects.” Speeding initial clone glycan and intact protein analysis. cell selection from 6 weeks to <1 week TAM = $1.8BN, Growing at 10-12% historical Note: Total growth Addressable rates data Market for markets Sizing (TAM) that are and nascent Market . Data growth represents rates forward-looking statements and are subject to inherent uncertainties that could cause actual results research to differ . These and such estimates differences are based could on be current material and . Please recent refer to the Company’s Cautionary Statements. TAM ranges from $700M to $1.8BN, where $700M is LC-UV and LC-MS based, and the remainder includes other technologies that are relevant in bioanalytical characterization. ©2023 Waters Corporation 19

Leaving the World Better Than We Found It 2022 ESG Highlights Environmental Social Governance Reducing our most significant Becoming more representative Enhancing long-term stakeholder environmental impacts. of the society we live in. value with effective oversight. ~60% 100/100 44% of electricity from low -carbon score on 2022 Human Rights of board is gender or or renewable sources, a Campaign Corporate ethnicity diverse. two-fold increase over 2020. Equality Index. Source: Waters Corporation data. ©2023 Waters Corporation 20

Putting It All Together Near-Term Mid-Term $19BN ï,§ $12BN Core TAM Market $12BN ï,§ $12BN Core TAM + $7BN Adjacencies Opportunity CORE CORE + ADJACENCIES + ï,§ MSD-HSD end market mix Growth MSD ï,§ MSD end market mix + Additional volume leverage +100bps + Productivity gains + + Productivity gains +20-30bps Margins Net Expansion + Pricing + Pricing —Reinvest in high-growth —Reinvest -70-80bps adjacencies inherent Note: Growth uncertainties rate estimates that could are for cause orga actual results to differ and such differences could be material. Please refer to the Company’s Cautionary Statements. Source: Waters Corporation estimates and projections. ©2023 Waters Corporation 21

Key Messages Consistently Strong Execution Innovation Revitalized Adjacencies Gaining Traction

Appendix GAAP to Non-GAAP Reconciliations

Reconciliation of GAAP to Adjusted Non-GAAP Net Sales by Operating Segments, End Markets, Geography, and Products & Services YTD Q3 2019—2022 % Growth Currency % Growth % Growth Currency % Growth (in millions USD) 2022 2021 Reported Impact CC 2021 2020 Reported Impact CC 2022 vs. 2021 2021 vs. 2020 Operating Waters $ 1,871.7 $ 1,731.0 8% $ (90.5) 13% $ 1,731.0 $ 1,413.4 22% $ 37.1 20% Segments TA $ 241.7 $ 218.4 11% $ (11.2) 16% $ 218.4 $ 165.3 32% $ 5.2 29% Pharmaceutical $ 1,258.9 $ 1,175.2 7% $ (61.2) 12% $ 1,175.2 $ 926.6 27% $ 22.6 24% End Markets Industrial $ 641.9 $ 581.9 10% $ (29.7) 15% $ 581.9 $ 474.6 23% $ 14.9 19% Academic & Government $ 212.7 $ 192.4 11% $ (10.7) 16% $ 192.4 $ 177.5 8% $ 4.9 6% Asia $ 812.3 $ 754.1 8% $ (45.0) 14% $ 754.1 $ 603.5 25% $ 8.1 24% Americas $ 762.5 $ 653.3 17% $ (1.3) 17% $ 653.3 $ 546.4 20% $ 2.1 19% Q3 2022 Geography Europe $ 538.7 $ 542.1 (1%) $ (55.4) 10% $ 542.1 $ 428.8 26% $ 32.2 19% (YTD) China $ 399.9 $ 346.0 16% $ (1.8) 16% $ 346.0 $ 252.7 37% $ 11.7 32% Asia (ex-China) $ 412.4 $ 408.1 1% $ (43.2) 12% $ 408.1 $ 350.8 16% $ (3.6) 17% Instruments $ 999.7 $ 873.6 14% $ (43.5) 19% $ 873.6 $ 664.8 31% $ 13.7 29% Products Chemistry $ 385.7 $ 368.5 5% $ (16.9) 9% $ 368.5 $ 300.5 23% $ 10.1 19% & Services Service $ 728.1 $ 707.3 3% $ (41.3) 9% $ 707.3 $ 613.4 15% $ 18.6 12% Total Recurring $ 1,113.7 $ 1,075.8 4% $ (58.2) 9% $ 1,075.8 $ 913.9 18% $ 28.7 15% Total Q3 YTD $ 2,113.4 $ 1,949.4 8% $ (101.6) 14% $ 1,949.4 $ 1,578.7 23% $ 42.4 21% The Company believes that referring to comparable constant-currency growth rates is a useful way to evaluate the underlying performance of Waters Corporation’s net sales. Constant-currency growth rate, a non-GAAP financial measure, measures the change in net sales between current and prior year periods, ignoring the impact of foreign currency exchange rates during the current period.

Reconciliation of GAAP to Adjusted Non-GAAP Net Sales by Operating Segments, End Markets, Geography, and Products & Services YTD Q3 2019—2022 (cont’d) % Growth Currency % Growth Reported % CC % (in millions USD) 2020 2019 Reported Impact CC 3 YR CAGR 3 YR CAGR 2020 vs. 2019 2022 vs. 2019 2022 vs. 2019 Operating Waters $ 1,413.4 $ 1,503.2 (6%) $ (5.0) (6%) 8% 9% Segments TA $ 165.3 $ 187.1 (12%) $ (0.6) (11%) 9% 10% Pharmaceutical $ 926.6 $ 972.9 (5%) $ (4.9) (4%) 9% 10% End Markets Industrial $ 474.6 $ 502.7 (6%) $ 1.4 (6%) 8% 9% Academic & Government $ 177.5 $ 214.7 (17%) $ (2.1) (16%) (0%) 1% Asia $ 603.5 $ 677.1 (11%) $ (6.8) (10%) 6% 8% Americas $ 546.4 $ 585.1 (7%) $ (0.0) (7%) 9% 9% Q3 2022 (YTD) Geography Europe $ 428.8 $ 428.1 0% $ 1.2 (0%) 8% 9% China $ 252.7 $ 314.5 (20%) $ (1.9) (19%) 8% 8% Asia (ex-China) $ 350.8 $ 362.6 (3%) $ (4.9) (2%) 4% 9% Instruments $ 664.8 $ 778.5 (15%) $ (2.2) (14%) 9% 10% Products Chemistry $ 300.5 $ 299.8 0% $ (0.5) 0% 9% 9% & Services Service $ 613.4 $ 612.0 0% $ (2.9) 1% 6% 7% Total Recurring $ 913.9 $ 911.8 0% $ (3.4) 1% 7% 8% Total Q3 YTD $ 1,578.7 $ 1,690.3 (7%) $ (5.6) (6%) 8% 9% The Company believes that referring to comparable constant-currency growth rates is a useful way to evaluate the underlying performance of Waters Corporation’s net sales. Constant-currency growth rate, a non-GAAP financial measure, measures the change in net sales between current and prior year periods, ignoring the impact of foreign currency exchange rates during the current period. ©2023 Waters Corporation 25

Operating Income Reconciliation of GAAP to Adjusted Non-GAAP Trailing Twelve Months (TTM) Ended October 1, 2022 (in thousands) Operating Operating Income Trailing Twelve Months Income Percentage GAAP $ 849,312 28.8% Adjustments: Purchased intangibles amortization 6,598 0.2% Acquired in-process research and development 9,797 0.3% Restructuring costs and certain other items 10,856 0.4% Pension expenses — Litigation settlement 5,165 0.2% Certain income tax items — Adjusted Non-GAAP $ 881,728 29.9% Q3 2022 YTD GAAP $ 587,112 27.8% Adjustments: Purchased intangibles amortization 4,863 0.2% Acquired in-process research and development 9,797 0.5% Restructuring costs and certain other items 7,187 0.3% Certain income tax items — Adjusted Non-GAAP $ 608,959 28.8% Q4 2021 GAAP $ 262,200 31.3% Adjustments: Purchased intangibles amortization 1,735 0.2% Restructuring costs and certain other items 3,669 0.4% Pension expenses — Litigation settlement 5,165 0.6% Certain income tax items — Adjusted Non-GAAP $ 272,769 32.6% ©2023 Waters Corporation 26