Millipore Corp.’s (NYSE:MIL) focus on selling consumables rather than big-ticket capital equipment paid off during the fourth quarter and full year 2009, as the Billerica, Mass.-based lab instruments maker posted strong sales and earnings numbers.
Fourth-quarter net income rose 41.2 percent to $43.9 million, or 78 cents per diluted share, compared with $31.1 million, or 56 cents per diluted share, during Q4 2008. Sale for the three months ended Dec. 31, 2009, rose 7.4 percent to $426 million, compared with $396.8 million during the same period last year, despite there being six fewer business days during Q4 2009.
For the full year, Millipore posted net income of $177 million, or $3.15 per diluted share, on sales of $1.65 billion, compared with net income of $137.6 million, or $2.47 per diluted share, on sales of $1.60 million in 2008.
CFO Charles Wagner, touting the $280 million in free cash flow the company generated during the year and Millipore’s gross margin growth (up 6.4 percent for the full year, to $907 million), credited the company’s improved operations and business model for the gains.
"The exceptional cash flow performance and margin expansion we have generated over the past five years reflect substantial underlying improvements in our operations and the attractiveness of our consumables-driven business model," Wagner said in prepared remarks.
The growth came despite a significant increase in research & development spending, both during the quarter and full year. Millipore’s fourth-quarter R&D spend went from $26 million in 2008 to $30.9 million in the just-ended period, an 18.8 percent increase; for the full year, its R&D spend rose 11.7 percent to $114.6 million, compared with $102.6 million in 2008.
"We made excellent progress against our goal of accelerating product innovation through internal R&D, partnerships, and strategic acquisitions. Our R&D spending increased by 12 percent in 2009; we successfully launched a number of innovative products; we initiated collaborations with several important technology partners; and we completed four acquisitions," chairman and CEO Martin Madaus said. "All of these initiatives put us in a strong position and as we look ahead to 2010, we are confident in our ability to deliver attractive revenue growth, margin expansion, and strong cash flow."
