Dionex Reports Record Net Sales for the Second Quarter
SUNNYVALE, Calif., Feb 9, 2010 (GlobeNewswire via COMTEX) -- By Staff
Company: Dionex Corp. (DNEX)
Dionex Corporation (Nasdaq:DNEX) today announced record sales for the second quarter and six months ended December 31, 2009.
For the second quarter of fiscal 2010, sales were $109.2 million, an increase of 6% compared with the $103.0 million reported in the same quarter of last year. Currency fluctuations increased reported sales by $7.5 million this quarter, or 7%, compared with the second quarter of last fiscal year. Sales from our acquisition of the ESA Life Sciences Tools business added an additional $4.1 million in sales for the quarter. Diluted earnings per share were $0.92 for the second quarter, compared with the $0.93 reported in the second quarter of last year. Net income for the second quarter of fiscal 2010 included a one-time charge of approximately $700,000, net of tax, related to the write-up of inventory in the acquisition of the ESA business and a discrete tax benefit of approximately $900,000 related to a favorable tax audit outcome.
For the first six months of fiscal 2010, sales were $199.8 million, an increase of 2% compared with the $196.5 million reported for the first six months of fiscal 2009. Overall, currency fluctuations increased our reported sales in the first six months of fiscal 2010 by approximately $5.6 million, or 3%, compared to the first six months of last fiscal year. Diluted earnings per share were $1.49, a decrease of 5% compared with the $1.57 reported in the first six months of fiscal 2009. Net income for the first six months of fiscal 2010 included a one-time charge of approximately $700,000, net of tax, related to the write-up of inventory in the acquisition of the ESA business line, acquisition related expenses of $220,000, net of tax, and a discrete tax benefit of approximately $900,000 related to the favorable tax audit outcome.
During the quarter, the Company repurchased 155,565 shares of its common stock for $10.9 million. In the first six months of fiscal 2010, the Company repurchased 343,818 shares of its common stock for $22.0 million.
Frank Witney, President and Chief Executive Officer, commenting on the results, said, "We are pleased with our results for the second quarter of fiscal year 2010, especially given the current economic environment and our very strong performance in the second quarter last year. We reported the highest quarterly sales in the history of our Company. We also reported good earnings for the quarter, driven by solid gross margins, excluding the one-time charge, and a discrete tax benefit. We managed operating expenses very effectively as the increase in operating expenses was due primarily to the effect of currency fluctuations, the on-going expenses associated with the ESA business we acquired in September and costs related to our Oracle implementation in Europe.
"Sales growth in the second quarter was mixed as all geographic regions grew in reported dollars but on an organic basis, only our Asia region grew this quarter. Sales in North America were up 6% for the quarter as sales benefited from the addition of the ESA products. Excluding these sales, growth in North America would have been down 9%. European sales were up 4% in reported dollars but were down 8% in local currency. Sales in our Asia/Pacific region for the second quarter grew 9% in reported dollars and 2% in local currency.
"Global demand from our environmental, life sciences, food/beverage and electronics customers was up this quarter. Customer demand in our chemical/petrochemical and power markets was down again this quarter as a result of on-going weak end-customer demand reflecting current economic conditions.
"We reported low-single digit sales growth in ion chromatography this quarter as North America and Europe continued to be difficult markets while Asia/Pacific showed growth for the quarter. Our HPLC sales grew in the mid teens this quarter compared with the second quarter last year aided by the acquisition of the ESA business line. Excluding the ESA sales, HPLC sales were flat for the quarter.
"In the first six months of this fiscal year, we experienced the impact of the global economic weakness on our business. We believe that we will see some improvement as we enter the second half of fiscal 2010 and we anticipate that our organic sales growth rates will increase to the mid-single digits. Given these factors and those below, we estimate that net sales will be in the range of $109-$113 million in the third quarter of fiscal 2010 and that diluted earnings per share will be in the range of $0.90-$0.93 per share. For the full year, we are increasing our estimates such that sales will be in the range of $413-$420 million and diluted earnings per share will be $3.15-$3.23. In addition to the above, assumptions on which our guidance is based include: (1) currency rates will have a positive impact on sales for the third and fourth quarters of fiscal 2010; (2) our gross margin will be in the range of 66-67% for fiscal 2010 excluding additional cost of goods sold related to the write-up of acquired inventory from the ESA acquisition; (3) our operating expenses will be higher than in prior years due to the ESA acquisition and on-going investments in our Asia and global IT initiatives; (4) our tax rate for fiscal year 2010 should be in the range of 32%-33%; (5) the acquisition of the ESA product lines will add $12-$15 million in net sales in fiscal 2010 and be slightly accretive excluding the acquisition related costs and the additional cost of goods sold related to the write-up of acquired ESA inventory totaling approximately $0.06 per diluted share; and (6) the current economic weakness will continue to affect our results, but we anticipate some recovery in the second half of the fiscal year."
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.
Management of the Company will discuss the second quarter results in a conference call on Tuesday, February 9, 2010, at 1:30 p.m. Pacific Time (PT). To listen to the call live, please tune into the webcast via www.dionex.com. A playback of the conference call will be available from 8:00 a.m. PT, Wednesday, February 10, 2010 until 5:00 p.m. PT, Wednesday, March 31, 2010.
Certain statements contained herein or made in the quarterly conference call that are not purely historical are forward-looking statements Factors that may cause actual results to differ from these statements are foreign currency fluctuations, ability to attract and retain qualified personnel, economic conditions in the areas in which the company sells its products and demand for analytical instrumentation. These factors and other risks and uncertainties are discussed in greater detail in the Company's most recent 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 Six Months Ended
December 31, December 31,
2009 2008 2009 2008
-------- -------- -------- --------
Net sales $109,164 $103,041 $199,828 $196,476
Cost of sales 36,975 33,471 68,015 64,195
-------- -------- -------- --------
Gross profit 72,189 69,570 131,813 132,281
-------- -------- -------- --------
Operating expenses:
Selling, general and
administrative 40,503 36,206 76,487 72,403
Research and product
development 7,654 7,451 14,825 14,480
-------- -------- -------- --------
Total operating
expenses 48,157 43,657 91,312 86,883
-------- -------- -------- --------
Operating income 24,032 25,913 40,501 45,398
Interest income, net (4) 266 43 451
Other income (expense) (832) 23 (1,042) (590)
-------- -------- -------- --------
Income before taxes on
income 23,196 26,202 39,502 45,259
Taxes on income 6,614 9,176 12,583 16,417
-------- -------- -------- --------
Net income $16,582 $17,026 $26,919 $28,842
======== ======== ======== ========
Basic earnings per share $0.94 $0.95 $1.52 $1.60
======== ======== ======== ========
Diluted earnings per
share $0.92 $0.93 $1.49 $1.57
======== ======== ======== ========
Shares used in computing
per share amounts:
Basic 17,654 17,912 17,678 17,990
======== ======== ======== ========
Diluted 18,025 18,217 18,032 18,382
======== ======== ======== ========
DIONEX CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
AT DECEMBER 31, 2009 AND JUNE 30, 2009
(In thousands)
(Unaudited)
December
31, June 30,
2009 2009
-------- --------
ASSETS
Current assets:
Cash, cash equivalents
and short term
investments $81,853 $70,325
Accounts receivable, net 86,000 70,535
Inventories 38,990 31,274
Other current assets 31,246 34,088
-------- --------
Total current assets 238,089 206,222
Property, plant and
equipment, net 78,620 71,927
Goodwill and other
intangible assets 51,154 37,860
Other assets 13,038 13,975
-------- --------
$380,901 $329,984
======== ========
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $13,616 $64
Accounts payable 17,726 16,545
Accrued liabilities 63,937 53,781
Income taxes payable 8,492 4,581
Accrued product warranty 2,764 3,028
-------- --------
Total current
liabilities 106,535 77,999
Deferred income taxes and
other 29,616 28,055
Stockholders' equity 244,750 223,930
-------- --------
$380,901 $329,984
======== ========
This news release was distributed by GlobeNewswire, www.globenewswire.com
SOURCE: Dionex Corporation
CONTACT: Dionex Corporation Craig McCollam 408-481-4107
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Company: Dionex Corp. (DNEX)
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