SUNNYVALE, Calif., Nov. 1 /PRNewswire-FirstCall/ -- Dionex Corporation today announced record sales for the first quarter of fiscal 2006, meeting EPS guidance.
Sales for the first quarter of fiscal 2006 were $68.1 million, an increase of 8%, compared with the $63.2 million reported for the first quarter of last year. Excluding the favorable impact of currency fluctuations, sales grew by 7% in the first quarter. Diluted earnings per share for the first quarter of fiscal 2006 were $0.44, compared to the $0.45 reported in the first quarter of last year. Net income included compensation cost of $1.3 million, net of tax, related to the adoption of Statement of Financial Accounting Standards (SFAS) No. 123R and other income of $1.0 million, net of tax, included a one-time gain from the favorable settlement of a patent litigation.
During the first quarter, the Company repurchased 385,900 shares of its common stock. In fiscal 2005, the Company repurchased 1,355,900 shares of its common stock.
Lukas Braunschweiler, President and Chief Executive Officer, commenting on the results, said, “Fiscal 2006 started with solid results for the first quarter with sales growing 8% and setting a record for a first quarter. Earnings per share met our expectations and guidance.
“Sales in North America were flat for the quarter reflecting the continued difficult business conditions in certain regions of the country mainly relating to the pharmaceutical industry. Sales in Europe grew 8% for the quarter driven by greater demand in the life sciences and environmental markets. Sales in Asia/Pacific grew very strongly at over 15% for the quarter due to greater demand in environmental and high purity water applications. Sales in the Asia/Pacific region were again affected by Japan which saw weaker sales due to still slower governmental spending. Outside of Japan, sales grew almost 40% driven by strong sales in Australia and India.
“Demand from our life sciences and environmental markets was up slightly this quarter. Chemical/Petrochemical continued to show growth this quarter again. Sales in our Electronics and Power markets grew sharply partially offset by lower sales in our Food/Beverage market, primarily in Europe and Asia/Pacific.
“We saw good growth in both ion chromatography and HPLC in fiscal 2006, with our HPLC products growing in the double digits and ion chromatography products growing in the mid single digits. Our gross margin was slightly lower than in the previous quarters mainly due to higher initial production costs related to our new products introduced in the second half of the last fiscal year.
“We believe that we are well positioned for solid growth throughout the rest of the fiscal year 2006. However, we believe that the second quarter will be challenging, as we have a comparison to a very strong performance reported in the second quarter last year, and as we assume continued weaker demand from the pharmaceutical industry and a slightly more adverse currency environment. We estimate that sales in the second quarter will be in the range of $74-$77 million and that GAAP diluted earnings per share will be in the range of $0.50-$0.56. For the entire year, we estimate that sales will be in the range of $292-$302 million and that GAAP diluted earnings per share will be in the range of $2.09-$2.17. Excluding the projected option expense charges related to implementation of SFAS No. 123R, our earnings per share will be in the range of $0.56-$0.62 for the second quarter and $2.30-$2.38 for the entire fiscal year. These estimates for fiscal year 2006 are based on the following assumptions: (a) slight improvements in the economies of the U.S., Europe and Japan; (b) demand from our pharmaceutical customers will improve in the second half of the fiscal year from the levels observed in calendar 2005 so far; and (c) foreign currency rates will have a slight adverse impact for the remainder of fiscal 2006.”
Dionex Corporation is a leading manufacturer and marketer of chromatography systems for chemical analysis. The Company’s systems are used in environmental analysis and by the life sciences, food and beverage, chemicals, petrochemicals, power generation and electronics industries in a variety of applications.
The company will discuss first quarter results in a conference call on Tuesday, November 1, 2005 at 1:30 p.m. Pacific Time (PT). To listen to the call live, please turn into the webcast via www.Dionex.com. A playback of the conference call will be available from 8:00 a.m. PT, Wednesday, November 2, 2005 until 5:00 p.m. PT, Friday, December 30, 2005.
Certain statements regarding sales and earnings contained herein that are not purely historical are forward-looking statements. Factors that may affect sales and earnings causing actual results to differ from these statements are foreign currency fluctuations, competition from other products, economic conditions in the areas in which the company sells its products, and existing product obsolescence. These factors and other risk and uncertainties are discussed in greater detail in the Company’s Reports on Form 10-K and 10-Q filed with the Securities and Exchange Commission.
DIONEX CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts) (Unaudited) Three Months Ended September 30, 2005 2004 Net sales $68,100 $63,208 Cost of sales 23,770 21,576 Gross profit 44,330 41,632 Operating expenses: Selling, general and administrative 26,680 22,418 Research and product development 5,534 4,929 Total operating expenses 32,214 27,347 Operating income 12,116 14,285 Interest income (expense), net 258 150 Other income (expense), net 1,473 455 Income before taxes on income 13,847 14,890 Taxes on income 4,833 5,226 Net income $9,014 $9,664 Basic earnings per share $0.45 $0.47 Diluted earnings per share $0.44 $0.45 Shares used in computing earnings per share amounts: Basic 20,114 20,718 Diluted 20,687 21,493 DIONEX CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS AT SEPTEMBER 30, 2005 AND JUNE 30, 2005 (In thousands) (Unaudited) September 30, June 30, 2005 2005 ASSETS Current assets: Cash, cash equivalents and short term investments $47,841 $53,781 Accounts receivable, net 52,928 55,450 Inventories 26,439 26,510 Other current assets 16,177 16,342 Total current assets 143,385 152,083 Property, plant and equipment, net 55,344 53,914 Goodwill and other intangible assets, net 30,108 27,555 Other assets 4,589 4,601 $233,426 $238,153 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Notes payable $711 $-- Accounts payable 8,047 10,031 Accrued liabilities 32,247 34,939 Income taxes payable 1,298 1,593 Accrued product warranty 3,336 3,514 Total current liabilities 45,639 50,077 Deferred income taxes and other 4,983 6,305 Stockholders’ equity 182,804 181,771 $233,426 $238,153
Dionex Corporation
CONTACT: Craig McCollam of Dionex Corporation, +1-408-481-4107
Web site: http://www.dionex.com/
