CARLSBAD, Calif., Feb. 29, 2012 /PRNewswire/ -- Life Technologies Corporation (NASDAQ: LIFE) today announced a revision to the Company’s earnings release dated February 7, 2012. Subsequent to the release but before the Company issued its financial statements for the fiscal year ended December 31, 2011, a court entered judgment against the Company on a case in litigation. The case, depending on the final outcome, could require the Company to pay additional damages of up to three times the judgment plus plaintiff’s attorney’s fees. The Company does not expect this verdict to have a material impact on its business going forward. Although the Company is considering all its options in view of the judgment, including filing various post-trial motions and an appeal, the Company has recorded a charge of approximately $56 million related to the lawsuit and unpaid royalties in the fourth quarter of fiscal 2011. As a result, the Company’s previously reported fourth quarter and full year 2011 GAAP diluted earnings per share will decrease $0.18 per share from $0.69 and $2.23 per share to $0.51 and $2.05 per share, respectively. Non-GAAP diluted earnings per share will decrease $0.01 per share from $1.06 to $1.05 for the fourth quarter ended December 31, 2011 and $0.02 per share from $3.73 to $3.71 for the year ended December 31, 2011. The Company has provided revised financial statements and a reconciliation of the Consolidated Statements of Operations provided on February 7, 2012 to the revised Consolidated Statements of Operations.
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The full updated press release follows:
Life Technologies Announces Fourth Quarter and Fiscal Year 2011 Results
- Fourth quarter revenue increased 4 percent to $970 million; GAAP earnings per share (EPS) increased to $0.51, or $1.05 on a non-GAAP basis, an increase of 17 percent
- 2011 revenue increased 4 percent to $3.7 billion; GAAP EPS increased to $2.05, or $3.71 on a non-GAAP basis, an increase of 5 percent
- 2011 free cash flow totaled $710 million
- 2012 outlook of non-GAAP organic revenue growth of 2 to 4 percent over 2011; Non-GAAP EPS guidance range of $3.90 to $4.05
CARLSBAD, CA, February 7, 2012 Life Technologies Corporation (NASDAQ: LIFE) today announced results for the quarter and full year ended December 31, 2011 and provided financial guidance for 2012.
“I am pleased with our performance in the fourth quarter and throughout 2011, even as we faced a number of challenges, including macroeconomic headwinds and constrained spending by some of our customers,” said Gregory T. Lucier, Chairman and Chief Executive Officer of Life Technologies. “Overcoming these obstacles, we delivered top line growth, reduced our operating costs to meet the slower growth environment and expanded our operating margins an impressive 100 basis points, all of which we leveraged to deliver bottom line growth for the twelfth consecutive year. We finished the year with strong free cash flow of $710 million.”
“Looking ahead to 2012, we expect growth in our game-changing Ion Torrent franchise, expansion in end markets and geographies and continued operational efficiencies to drive organic revenue growth of 2 to 4 percent over 2011 results and adjusted non-GAAP EPS in a range of $3.90 to $4.05.”
Life Technologies reported results compared to quarter and year ended December 31, 2010.
Analysis of Fourth Quarter 2011 and Fiscal Year 2011 Results
- Fourth quarter non-GAAP 2011 revenue increased 4 percent or 3 percent excluding the impact from currency, with particularly strong growth in sales of Ion Torrent and Forensics. Full year non-GAAP 2011 revenue increased 4 percent, or 3 percent excluding the impact from currency, driven by increased sales of Ion Torrent, BioProduction and Forensics. The increase in both periods was partially offset by a decrease in sales of SOLiD products.
- Non-GAAP gross margin in the fourth quarter decreased 20 basis points to 64.4 percent, driven primarily by product mix and the termination of a supply agreement, partially offset by realized price and manufacturing productivity. Full year non-GAAP gross margin was 65.2 percent, a decrease of 160 basis points, due to currency hedging losses, upgrades to our SOLiD 5500 and Ion Torrent sales, which were partially offset by realized price and manufacturing productivity.
- Non-GAAP operating margin increased 430 basis points to 30.6 percent in the fourth quarter, representing an all time high for the Company. Full year operating margin increased 30 basis points to 29.0 percent and, excluding currency, expanded 100 basis points. The increase in both periods resulted from a reduction in operating expenses including cost savings initiatives, a portion of which was offset by expenses related to developing Ion Torrent.
- The non-GAAP tax rate was 26.7 percent for the fourth quarter and 27.3 percent for the full year.
- Fourth quarter non-GAAP EPS increased 17 percent to $1.05. Full year non-GAAP EPS increased 5 percent to $3.71.
- Diluted weighted shares outstanding were 184.5 million in the fourth quarter.
- Cash flow from operating activities for the fourth quarter was $316 million. Fourth quarter capital expenditures were $34 million and resulting free cash flow was $282 million. The company ended the quarter with $882 million in cash and short-term investments.
Business Highlights:
- Genetic Systems division non-GAAP revenue increased 13 percent to $278 million in the fourth quarter, or 11 percent excluding the impact from currency. Growth in the current year quarter was driven by increased sales of Ion Torrent and double digit growth in Forensics, which was partially offset by reduced sales of SOLiD products. Full year non-GAAP revenue increased 8 percent to $1 billion, or 7 percent excluding the impact from currency. Growth for the full year period was driven by increased sales of Ion Torrent franchise, growth in Forensics and Capillary Electrophoresis, all of which was partially offset by lower growth in SOLiD products.
- Molecular Biology Systems division non-GAAP revenue decreased 1 percent to $441 million in the fourth quarter, or 2 percent excluding the impact of currency. The decline in the current year quarter resulted from a decline in qPCR royalties and continued lower spending by academic customers. Full year non-GAAP revenue was $1.7 billion, flat compared to the prior year period, and decreased 2 percent excluding the impact of currency. The decrease for the full year was the result of lower qPCR royalties, slower funding which drove lower PCR sales and a disruption in China sales as the company transitioned certain dealer networks to direct sales during the second quarter of 2011.
- Cell Systems division non-GAAP revenue increased 3 percent to $244 million in the fourth quarter, or 1 percent excluding the impact of currency, compared to a strong fourth quarter of 2010. Growth in the fourth quarter was driven by increased sales of cell culture products and by increased sales in BioProduction. Full year non-GAAP revenue increased 7 percent to $969 million, or 6 percent excluding the impact of currency. Full year growth was driven by increased BioProduction sales and sales across our cell consumables businesses.
- Regional organic growth rates for the quarter were as follows: the Americas was flat, Europe grew 4 percent, Asia Pacific grew 10 percent and Japan grew 4 percent. Full year growth rates were as follows: the Americas was 2%, Europe grew 3 percent, Asia Pacific 9 percent, and Japan declined 3 percent.
- Revenue from orders transacted through Life Technologies’ eCommerce channels grew approximately 8 percent during the quarter and approximately 12 percent for the full year. Over 50 percent of all transactions globally are processed using eCommerce platforms.
Changes in Reporting
The company plans to modify its reporting to better align with changes it has made in its internal organization. These changes have no impact on results of operations, financial condition or cash flows of the Company as a whole.
The company currently reports revenues for three divisions: Molecular Biology Systems, Genetic Systems and Cell Systems. Starting in the first quarter of 2012, the company will report revenues for the following three business groups: Research Consumables, Genetic Analysis and Applied Sciences. These changes will be finalized during and effective for the first quarter of 2012 and the company will provide revised financial data reflecting these changes prior to reporting its first quarter results in April 2012.
Fiscal Year 2012 Outlook
Subject to the risk factors detailed in the Safe Harbor Statement section of this release, the company provided its expectations for fiscal year 2012 financial performance. The company expects organic revenue growth of 2 to 4 percent over 2011 revenues of $3.7 billion and non-GAAP earnings per share to be in a range of $3.90 to $4.05. The guidance includes a revenue headwind of approximately $26 million, or 0.7 percent, and a benefit to non-GAAP EPS of approximately $0.02 from currency. The currency impact consists of a negative effect from changes in currency exchange rates based on December 2011 month end rates, partially offset by a benefit from not having the hedge losses that occurred in 2011. The company will provide further detail on its business outlook during the webcast today.
Webcast Details
The company will discuss its financial and business results as well as its business outlook on its webcast at 4:30 PM ET today. This webcast will contain forward-looking information. The webcast will include a discussion of “non-GAAP financial measures” as that term is defined in Regulation G. For actual results, the most directly comparable GAAP financial measures and information reconciling these non-GAAP financial measures to the company’s financial results determined in accordance with GAAP, as well as other material financial and statistical information to be discussed on the webcast will be posted at the company’s Investor Relations Web site at https://ir.lifetechnologies.com. The webcast can be accessed through the investor relations page of the Life Technologies’ website at https://ir.lifetechnologies.com/events.cfm. A replay of the webcast will be available on the company’s website through Tuesday, February 28, 2012.
About Life Technologies
Life Technologies Corporation (NASDAQ: LIFE) is a global biotechnology company dedicated to improving the human condition. Our systems, consumables and services enable researchers to accelerate scientific and medical advancements that make life even better. Life Technologies customers do their work across the biological spectrum, working to advance the fields of discovery and translational research, molecular medicine, stem cell-based therapies, food safety and animal health, and 21st century forensics. The company manufactures both molecular diagnostic and research use only products. Life Technologies’ industry-leading brands are found in nearly every life sciences lab in the world and include innovative instrument systems under the Applied Biosystems and Ion Torrent names, as well as, the broadest range of reagents with its Invitrogen, GIBCO, Ambion, Molecular Probes and TaqMan® products. Life Technologies had sales of $3.7 billion in 2011, employs approximately 10,400 people, has a presence in approximately 160 countries, and possesses one of the largest intellectual property estates in the life sciences industry, with approximately 4,000 patents and exclusive licenses. For more information on how we are making a difference, please visit our website: www.lifetechnologies.com.
