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Sigma-Aldrich Corporation have posted strong Q1 2015 results ahead of their planned merger with Merck later this year. Sigma reported quarterly sales of $676 million, with an organic growth rate of 5%. Changes in foreign currency exchange rates decreased sales by 8%, and shareholders will receive a quarterly dividend of $0.23 per share.
Commenting on performance in the first quarter of 2015, President and CEO Rakesh Sachdev said, “I am pleased to report that our teams delivered solid organic sales growth with contribution from all business units and major geographies. Despite a significant negative sales impact from unfavorable year-over-year changes in foreign currency exchange rates, the Company expanded adjusted operating margin and grew adjusted operating income.
Our Research business unit had growth contribution from all segments and geographies, continuing a trend that began in the second half of last year. Our Applied business unit was led by double-digit growth in the Diagnostics and Testing segment. Our SAFC Commercial business unit was led by the seventh consecutive quarter of double-digit organic sales growth in the Life Sciences Services segment and solid growth in the Life Sciences Product segment.
During the quarter, we launched new products such as the EX-CELL® Advanced CHO Fed-batch System, a high-performing batch media system developed for a range of widely used industrial CHO cell lines, including SAFC’s proprietary CHOZN® cell line. We also launched Next-Gen Sequencing Oligos, which are adapters that improve target sequence assembly.
We officially opened our state-of-the-art dry powder media manufacturing facility in Irvine, Scotland, which now serves as the European counterpart to the Lenexa, Kansas, Center of Excellence for cell culture media manufacture and supply. In April, we opened our state-of-the-art Cell Culture Technical Center in Singapore to support our biopharmaceutical customers in this fast growing region.
In March, we announced an exclusive global distribution agreement with Roche. The agreement pairs Roche’s Biochemical Reagents product portfolio, including kits and enzymes for cellular analysis, proteomics and conventional PCR applications, with Sigma-Aldrich’s industry-leading eCommerce and supply chain capabilities.”
Mr. Sachdev concluded, “Our teams are successfully executing the Company’s growth initiatives, and we are excited about the opportunity to join forces with Merck KGaA of Darmstadt, Germany. We continue to expect the transaction to close in mid-2015, subject to receipt of certain antitrust and government approvals and other customary closing conditions.”
Q1 2015 Results (all percentage changes are against comparable periods in 2014)
- Reported sales were $676 million compared to $689 million in the first quarter of 2014. Sales grew organically by 5%. Recent acquisitions increased sales by 1%. Changes in foreign currency exchange rates decreased sales by 8%.
- By business unit, organic sales growth was 3% in Research, 6% in Applied and 10% in SAFC Commercial.
- Reported diluted EPS was $1.04 compared to $1.05 in the first quarter of 2014. Adjusted diluted EPS (excluding $3 million of pre-tax merger-related costs) was $1.06, the same as in the first quarter of 2014. Changes in foreign currency exchange rates reduced first quarter 2015 adjusted EPS by $0.13. Excluding this impact, adjusted diluted EPS would have been $1.19, an increase of 12% from the same period last year.
You can read Sigma-Aldrich’s full press release on their website.
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