SUNNYVALE, Calif., Jan. 31, 2007 (PRIME NEWSWIRE) -- Dionex Corporation (Nasdaq:DNEX) today announced record net sales and earnings for the second quarter and six months ended December 31, 2006.
For the second quarter of fiscal 2007, sales were $83.5 million, an increase of 12% compared with the $74.3 million reported in the same quarter of last year. Excluding the favorable impact of currency fluctuations sales grew 9%, compared with the second quarter of fiscal 2006. Diluted earnings per share were $0.68 for the second quarter, up 28% from the $0.53 reported in the second quarter of last year. Net income for the second quarter of fiscal 2007 included a discrete tax benefit from the extension of the federal research credit of approximately $550,000 or $0.03 per share.
For the first six months of fiscal 2007, sales were $156.4 million, an increase of 10% compared with the $142.4 million reported for the first six months of fiscal 2006. Excluding favorable currency fluctuations sales grew 7%, compared to the first six months of fiscal 2006. Diluted earnings per share were $1.11, an increase of 14% compared with the first six months of fiscal 2006. Net income for the first six months of fiscal 2007 included cost of approximately $700,000, net of tax, or $0.04 per diluted share, related to the Company's initiative to centralize some of its field related technical, administrative and support functions within North America and Europe. Net income for the second quarter of fiscal 2007 included a discrete tax benefit from the extension of the federal research credit of approximately $550,000 or $0.03 per share. Net income for the first six months of fiscal 2006 included other income of $1.0 million, net of tax, or $0.05 per diluted share, related primarily to a one-time gain from the favorable settlement of patent litigation.
During the quarter, the Company repurchased 207,566 shares of its common stock for $11.6 million. In the first six months of fiscal 2007, the Company repurchased 644,566 shares of its common stock for $33.1 million.
Lukas Braunschweiler, President and Chief Executive Officer, commenting on the results, said, "We are very pleased with the results for the second quarter. We reported the highest quarterly sales in the history of the Company. We also reported record earnings for the quarter, driven by strong operating margin expansion.
"We experienced strong growth in most of our geographic regions and in both ion chromatography and HPLC. Sales in North America were down slightly for the quarter reflecting a continued difficult business environment with some of our larger pharmaceutical customers. European sales grew in the mid teens in reported dollars and in the high single digits in local currency. The strong sales in Europe resulted primarily from good growth in our life sciences market. Sales in our Asia/Pacific region grew over 20% in the second quarter in both reported dollars and local currency, driven by strong results in Japan, China, Korea, India and Australia.
"Demand from our life sciences customers was up strongly this quarter overall, and demand from our environmental customers was up slightly. Customer demand in our chemical/petrochemical, electronics and power markets was up significantly this quarter, while demand from our food/beverage customers was down slightly this quarter after a very strong first quarter.
"We experienced mid-teens sales growth in ion chromatography this quarter. The sales growth was broad based coming from both instrumentation and consumables. Our HPLC sales growth was solid. We are very pleased with the customer acceptance of our new Ultimate 3000 HPLC products.
"We believe with our strong performance in this quarter that we are well positioned for good sales and earnings growth in the remainder of fiscal 2007. We estimate that net sales will be in the range of $78-$81 million for the third quarter and diluted earnings per share will be in the range of $0.53-$0.56. We are increasing our sales and diluted earnings per share forecasts for the full year. We estimate that sales will be in the range of $312-$320 million and diluted earnings per share will be in the range of $2.18-$2.24. Among the assumptions on which our forecasts were based are: (1) currency rates will have a 1-2 percentage point positive impact on sales in fiscal 2007; (2) our gross margin will be in the range of 66-67% for the remainder of fiscal 2007; and (3) costs related to our centralization initiative were incurred in the first six months of fiscal 2007 totaling approximately $700,000, net of tax, or $0.04 per share for the full 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 first quarter results in a conference call on Wednesday, January 31, 2007, 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, Thursday, February 1, 2007 until 5:00 p.m. PT, Friday, March 30, 2007.
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, competition from other products, 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 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,
2006 2005 2006 2005
-------- -------- -------- --------
Net sales $ 83,519 $ 74,341 $156,376 $142,441
Cost of sales 27,655 24,529 52,614 48,299
-------- -------- -------- --------
Gross profit 55,864 49,812 103,762 94,142
-------- -------- -------- --------
Operating expenses:
Selling, general
and administrative 30,576 27,800 59,005 54,480
Research and
product
development 6,101 5,440 11,849 10,974
-------- -------- -------- --------
Total operating
expenses 36,677 33,240 70,854 65,454
-------- -------- -------- --------
Operating income 19,187 16,572 32,908 28,688
Interest income, net 191 295 500 553
Other income (expense) 262 65 (69) 1,538
-------- -------- -------- --------
Income before taxes
on income 19,640 16,932 33,339 30,779
Taxes on income 6,373 6,032 11,401 10,865
-------- -------- -------- --------
Net income $ 13,267 $ 10,900 $ 21,938 $ 19,914
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Basic earnings
per share $ 0.69 $ 0.54 $ 1.14 $ 0.99
======== ======== ======== ========
Diluted earnings
per share $ 0.68 $ 0.53 $ 1.11 $ 0.97
======== ======== ======== ========
Shares used in
computing per share
amounts:
Basic 19,154 20,038 19,297 20,072
======== ======== ======== ========
Diluted 19,609 20,554 19,732 20,614
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DIONEX CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
AT DECEMBER 31, 2006 AND JUNE 30, 2006
(In thousands)
(Unaudited)
December 31, June 30,
2006 2006
------------ --------
ASSETS
Current assets:
Cash, cash equivalents and short term
investments $ 52,071 $ 51,014
Accounts receivable, net 62,422 63,008
Inventories 27,867 27,702
Other current assets 16,909 15,706
-------- --------
Total current assets 159,269 157,430
Property, plant and equipment, net 62,053 58,700
Goodwill and other intangible assets 29,526 29,504
Other assets 4,221 4,768
-------- --------
$255,069 $250,402
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $ 5,938 $ --
Accounts payable 10,560 9,395
Accrued liabilities 41,233 39,673
Income taxes payable 5,713 7,100
Accrued product warranty 3,259 3,493
-------- --------
Total current liabilities 66,703 59,661
Deferred income taxes and other 5,734 5,359
Stockholders' equity 182,632 185,382
-------- --------
$255,069 $250,402
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