Friday February 1, 5:01 pm Eastern Time
Press Release
SOURCE: Fisher Scientific International Inc.
Fisher Scientific Reports Record Quarterly Sales and Earnings; EPS Outlook for 2002 Estimated at $1.62 to $1.67
HAMPTON, N.H., Feb. 1 /PRNewswire-FirstCall/ -- Fisher Scientific International Inc. (NYSE: FSH - news), the world leader in serving science, today reported record sales and earnings for the fourth quarter and full year ended Dec. 31, 2001, reflecting solid performance across all its business segments.
``Last year Fisher achieved strong sales and earnings growth despite the economic slowdown,'' said Paul M. Montrone, chairman and chief executive officer. ``We are well positioned for continued sales growth and improved profitability this year.''
Fourth-Quarter 2001 Results
Sales for the fourth quarter increased 17.1 percent to $754.7 million compared with $644.7 million in the corresponding period of 2000. The company's e-commerce sales increased to $151.7 million, or 20.1 percent of total sales, compared with $100.7 million, or 15.6 percent of total sales, in the fourth quarter of 2000.
Fourth-quarter net income, excluding nonrecurring and restructuring- related expenses, increased to $16.3 million, or 28 cents per diluted share, compared with $9.7 million, or 22 cents per diluted share, in the fourth quarter of 2000. Net income was $11.0 million, or 19 cents per diluted share, versus a loss of $8.3 million, or 21 cents per diluted share, in the fourth quarter of 2000.
Earnings before interest, taxes, depreciation and amortization (EBITDA), excluding nonrecurring and restructuring-related expenses, increased 36.0 percent to $72.6 million compared with $53.4 million in the same period of the prior year.
Special Items
Fisher completed its acquisition of Cole-Parmer, a global manufacturer and distributor of specialty instruments, equipment and supplies to the scientific-research and industrial markets, last November. Its 2001 results since the date of purchase are included in Fisher's domestic-distribution segment.
In the fourth quarter of 2001, Fisher implemented a plan to accelerate the integration of its international operations and continue streamlining domestic operations, including consolidating certain distribution centers. The company estimates that the total cost of the implementation of this plan will be approximately $10.7 million. The company recorded $9.3 million of nonrecurring and restructuring-related charges in connection with the plan. The company expects that implementation of the plan will reduce pretax expenses by approximately $6.0 million a year beginning in 2002. Fisher intends to reinvest approximately $3.0 million of this savings in sales, marketing and distribution in support of its chemical and life-sciences product portfolios, resulting in expected net annual savings of $3.0 million beginning in 2002.
Full-Year Results
For the year ended Dec. 31, 2001, sales totaled $2,880.0 million, a 9.8 percent increase from sales of $2,622.3 million in 2000. Excluding the effect of foreign exchange, sales totaled $2,897.7 million in 2001, a 10.5 percent increase from comparable 2000 sales. E-commerce sales increased to $518.0 million, or 18.0 percent of total sales for 2001, compared with $367.0 million, or 14.0 percent of total sales, in 2000.
Net income, excluding nonrecurring and restructuring-related expenses, increased 28.3 percent to $54.9 million, or diluted earnings per share of $1.04, compared with net income of $42.8 million, or 96 cents per share, in 2000. The dilutive effect of last year's public offering reduced 2001 earnings per share by 11 cents. Net income was $16.4 million, or 31 cents per diluted share, compared with $22.7 million, or 51 cents per diluted share, in 2000. EBITDA, excluding nonrecurring and restructuring-related expenses, increased 17.8 percent to $267.1 million in 2001, compared with $226.8 million in 2000.
Operating cash flow in 2001 increased to $158.6 million compared with $107.2 million the prior year, reflecting improvements in receivables, inventory and payables management. Operating working capital as a percentage of sales was 8.9 percent compared with 8.1 percent in 2000. Excluding acquisitions, 2001 operating working capital as a percentage of sales improved to 6.6 percent versus 7.6 percent in 2000. Capital expenditures last year increased to $40.1 million from $29.4 million in 2000, primarily due to the company's ongoing warehouse-consolidation program and acquisition-related expenditures.
Business-Segment Results
Domestic distribution sales increased 20.6 percent to $644.1 million in the fourth quarter of 2001 compared with the same period in 2000. The segment's e-commerce sales for the quarter increased to $142.6 million, or 22.1 percent of sales, versus 18.4 percent of sales in the fourth quarter of 2000. Operating income increased to $44.9 million from $33.1 million in the corresponding period of 2000. For full-year 2001, domestic distribution sales reached $2,439.9 million compared with $2,187.3 in 2000, an 11.6 percent increase. Operating income for 2001 grew to $173.4 million, a 15.8 percent increase over the previous year.
International distribution sales totaled $105.2 million in the latest quarter, a 3.0 percent increase from the fourth quarter of 2000. For the latest quarter, operating income totaled $4.4 million, flat with the same period in 2000. Sales for the full year increased to $425.4 million compared with $418.5 million in 2000, while operating income in 2001 increased to $13.6 million from $11.5 million in 2000. Excluding foreign-exchange effects, sales were $441.7 million, representing a 5.5 percent increase over the prior year. The operating performance of this segment, although showing improvement, is being addressed in the restructuring plan.
Fourth-quarter sales of the laboratory-workstations segment increased 7.9 percent to $46.5 million from $43.1 million in the prior year, while operating income was $1.6 million compared with $0.6 million in the corresponding quarter of 2000. Full-year sales rose to $178.6 million, up 8.1 percent from the prior year. Operating income for the year was $4.9 million compared with $3.5 million in 2000.
Order activity in the laboratory-workstations segment continued to be strong in the fourth quarter, with backlog increasing to $110 million, up 11 percent from the end of 2000.
Company Outlook
Fisher has adopted Statement of Financial Accounting Standards No. 141, ``Business Combinations'' (``SFAS 141'') and Statement of Financial Accounting Standards No. 142, ``Goodwill and Other Intangible Assets'' (``SFAS 142'') effective Jan. 1, 2002. These statements require that goodwill and certain intangible assets not be amortized, and also require the company to review them and write them down by the end of 2002 if they are determined to be impaired. The company expects to complete its evaluation by the second quarter of 2002.
For 2002, Fisher expects revenue growth, excluding foreign-exchange effects, of approximately 11 percent to 12 percent, and operating margins, reflecting the accounting changes described above, in the 7.5 percent to 7.8 percent range versus 7.3 percent in 2001. The non-amortization of goodwill is expected to result in an improvement in 2002 pretax income and net income of $16.7 million and $14.5 million, respectively, versus 2001. The breakdown of this improvement by segment is $7.8 million, $5.1 million and $3.8 million for domestic distribution, international distribution and lab workstations, respectively. Our outlook by segment follows:
Segment Revenue Growth Rate
(excluding foreign exchange) Operating Margin
Domestic 13.0%-14.0% 7.7%-7.9%
International 3.5%-4.0% 4.6%-4.9%
Lab Workstations 2.5%-3.0% 5.3%-5.6%
Interest and other expense is expected to be in line with that of 2001. Fisher estimates earnings per share (EPS) for 2002 will be $1.62 to $1.67, versus previous guidance of $1.52 to $1.57, based on an estimated weighted average of approximately 58.6 million diluted shares outstanding. This excludes any transitional impairment-related write-offs that may be recorded once the company's evaluation of the effect of SFAS 141 and SFAS 142 is completed. The EPS estimate is based on a 34 percent tax rate compared with 40 percent in 2001. Three percentage points of the improvement in the tax rate are due to recently implemented tax-planning strategies and the other three percentage points are due to the elimination of goodwill amortization. EPS for the first quarter is expected to be 30 cents to 32 cents.
Operating cash flow for 2002 is expected to be in the $120 million to $130 million range, and total depreciation and amortization for the year is estimated to be approximately $80 million. Capital expenditures are estimated at $65 million, reflecting continued facility consolidation and increased investment in chemical manufacturing and pharmaceutical services.
Upcoming Presentations
Fisher Scientific will present at the following conferences:
Merrill Lynch Global Pharmaceutical and Medical Device Conference at
3:35 p.m. Eastern Standard Time (EST) on Feb. 7, 2002, at the Grand
Hyatt Hotel in New York City.
Lehman Brothers Global Healthcare Conference at 11:15 a.m. EST on Feb. 27, 2002, at Disney's Grand Floridian Resort and Spa in Orlando, Fla.
Goldman Sachs 23rd Annual Healthcare Conference being held June 10-13, 2002, at the Ritz-Carlton Laguna Niguel in Dana Point, Calif.
Conference Call Scheduled
Fisher will host a teleconference to discuss its 2001 financial results and 2002 guidance on Monday, Feb. 4, 2002, at 9 a.m. EST. Interested parties who would like to participate may call 877-648-7975 (ID: Fisher Scientific). International callers should dial (+1) 706-634-2332. Following the call, an audio replay will be available for 10 days. Callers from the U.S. should dial 800-642-1687. International callers should dial (+1) 706-645-9291. The conference replay code is 2550830. The conference call will also be Webcast on Fisher's Web site (www.fisherscientific.com). The Webcast may be accessed on the Investor Relations Info page and will be archived for 30 days following the teleconference.
About Fisher Scientific International Inc.
As the world leader in serving science, Fisher Scientific International Inc. (NYSE: FSH - news) offers more than 600,000 products and services that enable scientific discovery and clinical laboratory testing services to more than 350,000 customers located in approximately 145 countries. As a result of its broad product offering, integrated global logistics network and electronic- commerce capabilities, Fisher serves as a one-stop source of products, services and global solutions for many of its customers. The company's primary target markets are life science, clinical laboratory and industrial- safety supply. Additional information about Fisher is available on the company's Web site at www.fisherscientific.com.
This announcement includes forward-looking statements. Fisher Scientific has based these forward-looking statements on its current expectations and projections about future events. Although Fisher Scientific believes that its assumptions made in connection with the forward-looking statements are reasonable, no assurances can be given that its assumptions and expectations will prove to have been correct. These forward-looking statements are subject to various risks, uncertainties and assumptions. Fisher Scientific undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this announcement might not occur.
Media Contact:
Gia L. Oei, 603-929-2489
E-mail: Gia.Oei@nh.fishersci.com
Investor Contact:
Carolyn Miller, 603-929-2381
E-mail: Carolyn.Miller@nh.fishersci.com
Fisher Scientific International Inc.
Statement of Operations
(in millions, except per share data)
Three Months
Ended Year Ended
December 31, December 31,
2001 2000 2001 2000
Sales $754.7 $644.7 $2,880.0 $2,622.3
Cost of sales 557.2 486.2 2,142.8 1,974.0
Selling, general and administrative
expense 146.4 124.6 546.4 494.0
Restructuring and other charges (credits) 8.1 - 59.7 (2.0)
Income from operations 43.0 33.9 131.1 156.3
Interest expense 24.6 24.1 99.5 99.1
Other (income) expense, net (0.3) 23.7 1.3 19.4
Income before income taxes 18.7 (13.9) 30.3 37.8
Income tax provision 7.7 (5.6) 13.9 15.1
Net income $11.0 $(8.3) $16.4 $22.7
Net income per common share:
Basic $0.20 $(0.21) $0.33 $0.57
Diluted $0.19 $(0.21) $0.31 $0.51
Weighted average common shares
outstanding:
Basic 54.1 40.1 49.4 40.1
Diluted 57.4 40.1 53.0 44.4
Supplementary Information:
The following amounts exclude nonrecurring and restructuring-related
charges
Income before income taxes $18.7 $(13.9) $30.3 $37.8
Add restructuring and other charges
(credits), net 8.1 - 59.7 (2.0)
Add nonrecurring operating charges 0.4 4.9 1.5 10.4
Add nonrecurring investment writedown - 23.6 - 23.6
Income before income taxes excluding
nonrecurring and
restructuring-related charges $27.2 $14.6 $91.5 $69.8
Net income excluding nonrecurring and
restructuring-related charges $16.3 $9.7 $54.9 $42.8
Diluted net income per common share
excluding nonrecurring
and restructuring-related charges $0.28 $0.22 $1.04 $0.96
Fisher Scientific International Inc.
Segment Results
(in millions)
Three Months Ended Year Ended
December 31, December 31,
Growth Growth
2001 2000 Rate 2001 2000 Rate
Revenue
Domestic Distribution $644.1 $534.3 20.6% $2,439.9 $2,187.3 11.6%
International
Distribution 105.2 102.1 3.0% 425.4 418.5 1.7%
Laboratory Workstations 46.5 43.1 7.9% 178.6 165.2 8.1%
Eliminations (41.1) (34.8) - (163.9) (148.7) -
Total $754.7 $644.7 17.1% $2,880.0 $2,622.3 9.8%
Three Months Ended
December 31,
Operating Operating
2001 Margin 2000 Margin
Operating Income
Domestic Distribution $44.9 7.0% $33.1 6.2%
International Distribution 4.4 4.2% 4.4 4.3%
Laboratory Workstations 1.6 3.4% 0.6 1.4%
Eliminations 0.6 0.7
Segment sub-total 51.5 6.8% 38.8 6.0%
Restructuring and other charges (8.1) -
Nonrecurring charges (0.4) (4.9)
Total $43.0 5.7% $33.9 5.3%
Year Ended
December 31,
Operating Operating
2001 Margin 2000 Margin
Operating Income
Domestic Distribution $173.4 7.1% $149.8 6.9%
International Distribution 13.6 3.2% 11.5 2.8%
Laboratory Workstations 4.9 2.7% 3.5 2.1%
Eliminations 0.4 (0.1)
Segment sub-total 192.3 6.7% 164.7 6.3%
Restructuring and other charges (59.7) 2.0
Nonrecurring charges (1.5) (10.4)
Total $131.1 4.6% $156.3 6.0%
Fisher Scientific International Inc.
Condensed Balance Sheet
(in millions)
December 31,
2001 2000
ASSETS
Current assets:
Cash and cash equivalents $75.1 $66.0
Receivables, net 332.0 296.8
Inventories 261.4 224.2
Other current assets 89.3 63.6
Total current assets 757.8 650.6
Property, plant and equipment 322.1 251.3
Goodwill 507.4 334.2
Other assets 251.9 149.6
Total assets $1,839.2 $1,385.7
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)
Current liabilities:
Short-term debt $75.7 $47.6
Accounts payable 336.1 308.5
Accrued and other current
liabilities 225.9 151.7
Total current liabilities 637.7 507.8
Long-term debt 956.1 991.1
Other liabilities 222.1 198.5
Total liabilities 1,815.9 1,697.4
Commitments and contingencies
Stockholders' equity (deficit):
Common stock 0.5 0.4
Capital in excess of par value 661.1 326.0
Accumulated deficit (555.5) (571.9)
Other (82.8) (66.2)
Total stockholders' equity
(deficit) 23.3 (311.7)
Total liabilities and
stockholders' equity (deficit) $1,839.2 $1,385.7
No amounts were outstanding under the receivables securitization facility
at December 31, 2001 and 2000.
Fisher Scientific International Inc.
Condensed Statement of Cash Flows
(in millions)
Year Ended
December 31,
2001 2000
Cash flows from operating activities:
Net income $16.4 $22.7
Depreciation and amortization 82.0 63.6
Other adjustments to reconcile net
income to cash
provided by operating activities 51.2 30.8
Changes in working capital and
other assets and liabilities 9.0 (9.9)
Cash provided by operating
activities 158.6 107.2
Cash flows from investing activities:
Acquisitions, net of cash acquired (371.2) (23.1)
Capital expenditures (40.1) (29.4)
Other investing activity (8.3) (4.6)
Cash used by investing
activities (419.6) (57.1)
Cash flows from financing activities:
Proceeds from sale of common stock 289.9 -
Changes in the accounts receivable
securitization, net - (21.7)
Other financing activity (19.9) (11.1)
Cash provided by (used in)
financing activities 270.0 (32.8)
Effect of exchange rate changes on cash 0.1 (1.6)
Net change in cash and cash
equivalents 9.1 15.7
Cash and cash equivalents - beginning
of period 66.0 50.3
Cash and cash equivalents - end of
period $75.1 $66.0
SOURCE: Fisher Scientific International Inc. |
