Thermo Fisher raises earnings guidance

October 25, 2007 07:46 AM E-mail| |Comments ()| Text size – +

Thermo Fisher Scientific Inc. today reported a sharply higher third-quarter profit that bested Wall Street expectations, and the maker of scientific instruments raised financial expectations for the full year.

The Waltham-based company, which more than doubled in size after the former Thermo Electron acquired Fisher Scientific last November, reported net income for the July-September period of $218.5 million, or 49 cents per share.

The profit was more than four times last year's third-quarter net income of $48.8 million, or 30 cents per share, when Thermo Electron was a standalone company.

Revenue also more than tripled from a year ago, from to $724.9 million to $2.40 billion. The result beat the consensus forecast of analysts surveyed by Thomson Financial, who expected revenue of $2.38 billion.

Had the two companies been combined in the second quarters of both years, comparable revenue growth was 7 percent.

Excluding one-time gains and expenses, Thermo Fisher's profit in the latest quarter was 65 cents per share, compared with 44 cents per share a year ago, had the companies been combined then. The latest quarter's result beat analysts' forecast of 63 cents per share.

"We had solid revenue growth, led by high demand for life science and air quality instruments, specialty diagnostics products and biopharma services," said Marijn Dekkers, president and chief executive.

Thermo Fisher saw relatively slow sales growth of 4 percent in its biggest business segment, laboratory products and services, with revenue of $1.45 billion.

The analytical technologies segment grew 12 percent to $1.04 billion.

Thermo Fisher raised full-year profit and revenue expectations. The company projects a profit of $2.56 to $2.59 per share, compared with its previous guidance of $2.50 to $2.56 per share.

Revenue is expected to reach $9.6 to $9.65 billion for the year, up from previous guidance of $9.5 billion to $9.55 billion for the year.

Analysts had projected profits of $2.57 per share on revenue of $9.59 billion.

After last year's Thermo-Fisher deal, the company has continued growing through small acquisitions, such as an Oct. 9 deal for instrument maker NanoDrop Technologies LLC. In Thursday's news release, Dekkers suggested more acquisitions could be coming.

"Our more recent activity shows that acquisitions continue to be an important part of our growth strategy," he said. "The life, laboratory and health sciences industry remains highly fragmented, and this presents opportunities for us to make acquisitions."

The 11,000-employee Thermo Electron acquired Hampton, N.H.-based Fisher Scientific, which had 19,500 workers. The company's customers include pharmaceutical companies, government research labs, hospitals and universities.

Products are branded under the names Fisher Scientific and Thermo Scientific, competing against rivals such as Agilent Technologies Inc., Beckman Coulter Inc. and Becton, Dickinson & Co. (AP)