[November 19, 2012] |
|
Agilent Technologies Reports Fourth-Quarter 2012 Results
SANTA CLARA, Calif. --(Business Wire)--
Agilent Technologies Inc. (NYSE: A) today reported revenues of $1.77
billion for the fourth fiscal quarter ended Oct. 31, 2012, 2 percent
above one year ago. Fourth-quarter GAAP net income was $425 million, or
$1.20 per share. Last year's fourth-quarter GAAP net income was $289
million, or $0.82 per share.
During the fourth quarter, Agilent had intangible amortization of $52
million; acquisition, integration and transformation costs of $40
million; and a donation to the Agilent Technologies Foundation of $10
million. The company also recognized a tax benefit of $227 million.
Excluding these items and $3 million of other net charges, Agilent
reported fourth-quarter adjusted net income of $303 million, or $0.86
per share(1).
Agilent CEO Bill Sullivan said, "Agilent's performance in the fiscal
fourth quarter met our revenue guidance and exceeded EPS guidance.
Despite a very challenging economic environment, the strength of our
operating model was evident, with operating margins for the quarter and
the year at an all-time high."
Electronic Measurement fourth-quarter revenues declined 5 percent
compared to the prior year. Revenues declined across all key markets
with the exception of computer and semiconductor markets. Operating
margins were 23 percent.
Chemical Analysis revenues were down 3 percent compared to a year ago.
Environmental and chemical markets were down, offset by growth in the
food and forensics markets. Operating margins were 25 percent.
Life Sciences revenues were flat with last year. Growth in the pharma
and environmental markets was offset by a decline in academia and
government markets. Operating margins were 18 percent.
Diagnostics and Genomics, which includes the Dako acquisition, had
revenues of $156 million, up 125 percent over last year or 1 percent
excluding the effects of the Dako acquisition. Operating margins were 17
percent.
Agilent generated $485 million of cash from operations in the quarter.
Fourth-quarter ROIC was 19 percent(3).
Fiscal first-quarter 2013 revenues are expected to be in the range of
$1.68 billion to $1.70 billion. Fiscal first-quarter non-GAAP earnings
are expected to be in the range of $0.65 to $0.67 per share(2).
For the full fiscal year 2013, Agilent expects revenue of $7.0 billion
to $7.20 billion and non-GAAP earnings of $2.80 to $3.10 per share(2).
About Agilent Technologies
Agilent Technologies Inc. (NYSE: A) is the world's premier measurement
company and a technology leader in chemical analysis, life sciences,
diagnostics, electronics and communications. The company's 20,500
employees serve customers in more than 100 countries. Agilent had
revenues of $6.9 billion in fiscal 2012. Information about Agilent is
available at www.agilent.com.
Agilent's management will present more details about its fourth-quarter
FY2012 financial results on a conference call with investors today at
1:30 p.m. PST. This event will be webcast live in listen-only mode.
Listeners may log on at www.investor.agilent.com
and select "Q4 2012 Agilent Technologies Inc. Earnings Conference Call"
in the "News & Events Calendar of Events" section. The webcast will
remain available on the company's website for 90 days.
Additional information regarding financial results can be found at www.investor.agilent.com
by selecting "Financial Results" in the "Financial Information" section.
A telephone replay of the conference call will be available at 3:30 p.m.
PST today through Nov. 26. The replay number is +1 888 286-8010;
international callers may dial (617) 801-6888. The passcode is 72627474.
Forward-Looking Statements
This news release contains forward-looking statements as defined in the
Securities Exchange Act of 1934 and is subject to the safe harbors
created therein. The forward-looking statements contained herein
include, but are not limited to, information regarding Agilent's future
revenues, earnings and profitability; the future demand for the
company's products and services; and revenue and non-GAAP earnings
guidance for the first quarter and full fiscal year 2013. These
forward-looking statements involve risks and uncertainties that could
cause Agilent's results to differ materially from management's current
expectations. Such risks and uncertainties include, but are not limited
to, unforeseen changes in the strength of our customers' businesses,
unforeseen changes in the demand for current and new products,
technologies, and services, and the risk that we are not able to realize
the savings expected from integration and restructuring activities.
In addition, other risks that Agilent faces in running its operations
include the ability to execute successfully through business cycles; the
ability to meet and achieve the benefits of its cost-reduction goals and
otherwise successfully adapt its cost structures to continuing changes
in business conditions; ongoing competitive, pricing and gross-margin
pressures; the risk that our cost-cutting initiatives will impair our
ability to develop products and remain competitive and to operate
effectively; the impact of geopolitical uncertainties and global
economic conditions on our operations, our markets and our ability to
conduct business; the ability to improve asset performance to adapt to
changes in demand; the ability of our supply chain to adapt to changes
in demand; the ability to successfully introduce new products at the
right time, price and mix; the ability of Agilent to successfully
integrate recent acquisitions; and other risks detailed in Agilent's
filings with the Securities and Exchange Commission, including our
Quarterly Report on Form 10-Q for the quarter ended July 31, 2012.
Forward-looking statements are based on the beliefs and assumptions of
Agilent's management and on currently available information. Agilent
undertakes no responsibility to publicly update or revise any
forward-looking statement.
(1) Non-GAAP net income and non-GAAP net income per share
exclude primarily the impacts of acquisition and integration costs,
acquisition fair value adjustments, transformation initiatives and
restructuring costs, and non-cash intangibles amortization. We also
exclude any tax benefits that are not directly related to ongoing
operations and which are either isolated or cannot be expected to occur
again with any regularity or predictability. A reconciliation between
non-GAAP net income and GAAP net income is set forth on page 5 of the
attached tables along with additional information regarding the use of
this non-GAAP measure.
(2) Non-GAAP earnings per share as projected for Q1FY13 and
full fiscal year 2013 excludes primarily the impacts of acquisition and
integration costs, future restructuring costs, asset impairment charges,
and non-cash intangibles amortization. We also exclude any tax benefits
that are not directly related to ongoing operations and which are either
isolated or cannot be expected to occur again with any regularity or
predictability. Most of these excluded amounts pertain to events that
have not yet occurred and are not currently possible to estimate with a
reasonable degree of accuracy. Therefore, no reconciliation to GAAP
amounts has been provided. Future amortization of intangibles is
expected to be approximately $50 million per quarter.
(3) Return on invested capital (ROIC) is a non-GAAP measure
and is defined as income from operations less other (income) expense and
taxes, annualized, divided by the average of the two most recent
quarter-end balances of assets less net current liabilities. The
reconciliation of ROIC can be found on page 7 of the attached tables,
along with additional information regarding the use of this non-GAAP
measure.
NOTE TO EDITORS: Further technology, corporate citizenship and executive
news is available on the Agilent news site at www.agilent.com/go/news.
|
AGILENT TECHNOLOGIES, INC.
|
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
|
(In millions, except per share amounts)
|
(Unaudited)
|
PRELIMINARY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
October 31,
|
|
Percent
|
|
|
2012
|
|
2011
|
|
Inc/(Dec)
|
|
|
|
|
|
|
|
Orders
|
|
$
|
1,751
|
|
|
$
|
1,752
|
|
|
--
|
|
|
|
|
|
|
|
|
Net revenue
|
|
$
|
1,767
|
|
|
$
|
1,728
|
|
|
2
|
%
|
|
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
Cost of products and services
|
|
|
845
|
|
|
|
807
|
|
|
5
|
%
|
Research and development
|
|
|
178
|
|
|
|
163
|
|
|
9
|
%
|
Selling, general and administrative
|
|
|
466
|
|
|
|
445
|
|
|
5
|
%
|
Total costs and expenses
|
|
|
1,489
|
|
|
|
1,415
|
|
|
5
|
%
|
|
|
|
|
|
|
|
Income from operations
|
|
|
278
|
|
|
|
313
|
|
|
(11
|
%)
|
|
|
|
|
|
|
|
Interest income
|
|
|
2
|
|
|
|
4
|
|
|
(50
|
%)
|
Interest expense
|
|
|
(26
|
)
|
|
|
(23
|
)
|
|
13
|
%
|
Other income (expense), net
|
|
|
2
|
|
|
|
(1
|
)
|
|
--
|
|
|
|
|
|
|
|
|
Income before taxes
|
|
|
256
|
|
|
|
293
|
|
|
(13
|
%)
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes
|
|
|
(169
|
)
|
|
|
4
|
|
|
--
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
425
|
|
|
$
|
289
|
|
|
47
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share:
|
|
|
|
|
|
|
Basic
|
|
$
|
1.22
|
|
|
$
|
0.83
|
|
|
|
Diluted
|
|
$
|
1.20
|
|
|
$
|
0.82
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares used in computing net income per share:
|
|
|
|
|
|
|
Basic
|
|
|
348
|
|
|
|
347
|
|
|
|
Diluted
|
|
|
353
|
|
|
|
351
|
|
|
|
|
|
|
|
|
|
|
Cash dividends declared per common share
|
|
$
|
0.10
|
|
|
$
|
--
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The preliminary income statement is estimated based on our current
information.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Page 1
|
|
|
AGILENT TECHNOLOGIES, INC.
|
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
|
(In millions, except per share amounts)
|
(Unaudited)
|
PRELIMINARY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years Ended
|
|
|
|
|
October 31,
|
|
Percent
|
|
|
2012
|
|
2011
|
|
Inc/(Dec)
|
|
|
|
|
|
|
|
Orders
|
|
$
|
6,877
|
|
|
$
|
6,769
|
|
|
2
|
%
|
|
|
|
|
|
|
|
Net revenue
|
|
$
|
6,858
|
|
|
$
|
6,615
|
|
|
4
|
%
|
|
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
Cost of products and services
|
|
|
3,254
|
|
|
|
3,086
|
|
|
5
|
%
|
Research and development
|
|
|
668
|
|
|
|
649
|
|
|
3
|
%
|
Selling, general and administrative
|
|
|
1,817
|
|
|
|
1,809
|
|
|
--
|
|
Total costs and expenses
|
|
|
5,739
|
|
|
|
5,544
|
|
|
4
|
%
|
|
|
|
|
|
|
|
Income from operations
|
|
|
1,119
|
|
|
|
1,071
|
|
|
4
|
%
|
|
|
|
|
|
|
|
Interest income
|
|
|
9
|
|
|
|
14
|
|
|
(36
|
%)
|
Interest expense
|
|
|
(101
|
)
|
|
|
(86
|
)
|
|
17
|
%
|
Other income (expense), net
|
|
|
16
|
|
|
|
33
|
|
|
(52
|
%)
|
|
|
|
|
|
|
|
Income before taxes
|
|
|
1,043
|
|
|
|
1,032
|
|
|
1
|
%
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes
|
|
|
(110
|
)
|
|
|
20
|
|
|
--
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
1,153
|
|
|
$
|
1,012
|
|
|
14
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share:
|
|
|
|
|
|
|
Basic
|
|
$
|
3.31
|
|
|
$
|
2.92
|
|
|
|
Diluted
|
|
$
|
3.27
|
|
|
$
|
2.85
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares used in computing net income per share:
|
|
|
|
|
|
|
Basic
|
|
|
348
|
|
|
|
347
|
|
|
|
Diluted
|
|
|
353
|
|
|
|
355
|
|
|
|
|
|
|
|
|
|
|
Cash dividends declared per common share
|
|
$
|
0.30
|
|
|
$
|
--
|
|
|
|
|
|
|
.
|
|
|
|
|
|
|
|
|
|
|
|
|
The preliminary income statement is estimated based on our current
information.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Page 2
|
|
|
AGILENT TECHNOLOGIES, INC.
|
CONDENSED CONSOLIDATED BALANCE SHEET
|
(In millions, except par value and share amounts)
|
(Unaudited)
|
PRELIMINARY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October 31,
|
|
October 31,
|
|
|
|
|
|
2012
|
|
2011
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
2,351
|
|
|
$
|
3,527
|
|
|
Accounts receivable, net
|
|
|
923
|
|
|
|
860
|
|
|
Inventory
|
|
|
1,014
|
|
|
|
898
|
|
|
Other current assets
|
|
|
341
|
|
|
|
284
|
|
|
|
Total current assets
|
|
|
4,629
|
|
|
|
5,569
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
|
1,164
|
|
|
|
1,006
|
|
Goodwill
|
|
|
|
|
3,025
|
|
|
|
1,567
|
|
Other intangible assets, net
|
|
|
1,086
|
|
|
|
429
|
|
Long-term investments
|
|
|
109
|
|
|
|
117
|
|
Other assets
|
|
|
523
|
|
|
|
369
|
|
|
|
Total assets
|
|
$
|
10,536
|
|
|
$
|
9,057
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable
|
|
$
|
461
|
|
|
$
|
472
|
|
|
Employee compensation and benefits
|
|
|
387
|
|
|
|
424
|
|
|
Deferred revenue
|
|
|
420
|
|
|
|
389
|
|
|
Short-term debt
|
|
|
250
|
|
|
|
253
|
|
|
Other accrued liabilities
|
|
|
375
|
|
|
|
299
|
|
|
|
Total current liabilities
|
|
|
1,893
|
|
|
|
1,837
|
|
|
|
|
|
|
|
|
|
Long-term debt
|
|
|
2,112
|
|
|
|
1,932
|
|
Retirement and post-retirement benefits
|
|
|
554
|
|
|
|
329
|
|
Other long-term liabilities
|
|
|
792
|
|
|
|
643
|
|
|
|
Total liabilities
|
|
|
5,351
|
|
|
|
4,741
|
|
|
|
|
|
|
|
|
|
Total Equity:
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
Preferred stock; $0.01 par value; 125 million shares authorized;
none issued and outstanding
|
|
|
-
|
|
|
|
-
|
|
|
Common stock; $0.01 par value; 2 billion shares authorized; 595 million
shares at October 31, 2012 and 591 million shares at October 31,
2011, issued
|
|
|
6
|
|
|
|
6
|
|
|
Treasury stock at cost; 249 million shares at October 31, 2012 and
244 million shares at October 31, 2011
|
|
|
(8,707
|
)
|
|
|
(8,535
|
)
|
|
Additional paid-in-capital
|
|
|
8,489
|
|
|
|
8,265
|
|
|
Retained earnings
|
|
|
5,505
|
|
|
|
4,456
|
|
|
Accumulated other comprehensive income (loss)
|
|
|
(111
|
)
|
|
|
116
|
|
|
|
Total stockholders' equity
|
|
|
5,182
|
|
|
|
4,308
|
|
|
Non-controlling interest
|
|
|
3
|
|
|
|
8
|
|
|
|
Total equity
|
|
|
5,185
|
|
|
|
4,316
|
|
|
|
Total liabilities and equity
|
|
$
|
10,536
|
|
|
$
|
9,057
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The preliminary balance sheet is estimated based on our current
information.
|
|
|
|
|
|
|
|
|
|
Page 3
|
|
|
AGILENT TECHNOLOGIES, INC.
|
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
|
(In millions)
|
(Unaudited)
|
PRELIMINARY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
|
|
Year
|
|
|
|
|
|
Ended
|
|
Ended
|
|
|
|
|
|
October 31,
|
|
October 31,
|
|
|
|
|
|
2012
|
|
2012
|
Cash flows from operating activities:
|
|
|
|
|
|
Net income
|
|
$
|
425
|
|
|
$
|
1,153
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile net income to net cash provided by (used
in) operating activities:
|
|
|
|
|
|
Depreciation and amortization
|
|
|
94
|
|
|
|
301
|
|
|
Share-based compensation
|
|
|
15
|
|
|
|
74
|
|
|
Excess and obsolete inventory and inventory related charges
|
|
|
10
|
|
|
|
30
|
|
|
Other non-cash expenses, net
|
|
|
2
|
|
|
|
4
|
|
|
Changes in assets and liabilities:
|
|
|
|
|
|
|
Accounts receivable
|
|
|
41
|
|
|
|
19
|
|
|
|
Inventory
|
|
|
22
|
|
|
|
(52
|
)
|
|
|
Accounts payable
|
|
|
(30
|
)
|
|
|
(31
|
)
|
|
|
Employee compensation and benefits
|
|
|
51
|
|
|
|
(54
|
)
|
|
|
Other assets and liabilities
|
|
|
(145
|
)
|
|
|
(216
|
)
|
Net cash provided by operating activities (a)
|
|
|
485
|
|
|
|
1,228
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
Investments in property, plant and equipment
|
|
|
(61
|
)
|
|
|
(193
|
)
|
|
Proceeds from lease receivable
|
|
|
-
|
|
|
|
80
|
|
|
Proceeds from sale of investment securities
|
|
|
-
|
|
|
|
5
|
|
|
Purchase of non-controlling interest
|
|
|
-
|
|
|
|
(6
|
)
|
|
Acquisition of businesses and intangible assets, net of cash acquired
|
|
|
(30
|
)
|
|
|
(2,257
|
)
|
Net cash used in investing activities
|
|
|
(91
|
)
|
|
|
(2,371
|
)
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
Issuance of common stock under employee stock plans
|
|
|
10
|
|
|
|
100
|
|
|
Payment of dividends
|
|
|
(34
|
)
|
|
|
(104
|
)
|
|
Treasury stock repurchases
|
|
|
(94
|
)
|
|
|
(172
|
)
|
|
Repayment of credit facility
|
|
|
-
|
|
|
|
(1
|
)
|
|
Issuance of senior notes
|
|
|
399
|
|
|
|
399
|
|
|
Debt issuance costs
|
|
|
(4
|
)
|
|
|
(4
|
)
|
|
Repayment of senior notes
|
|
|
(250
|
)
|
|
|
(250
|
)
|
Net cash provided by (used in) financing activities
|
|
|
27
|
|
|
|
(32
|
)
|
|
|
|
|
|
|
|
|
Effect of exchange rate movements
|
|
|
7
|
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
428
|
|
|
|
(1,176
|
)
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at beginning of period
|
|
|
1,923
|
|
|
|
3,527
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
2,351
|
|
|
$
|
2,351
|
|
|
|
|
|
|
|
|
|
|
(a) Cash payments included in operating activities:
|
|
|
|
|
|
|
Restructuring payments
|
|
|
(5
|
)
|
|
|
(29
|
)
|
|
|
Income tax payments, net
|
|
|
(13
|
)
|
|
|
(86
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The preliminary cash flow is estimated based on our current
information.
|
|
|
|
|
|
|
|
|
|
|
Page 4
|
|
|
AGILENT TECHNOLOGIES, INC.
|
NON-GAAP NET INCOME AND DILUTED EPS RECONCILIATIONS
|
(In millions, except per share amounts)
|
(Unaudited)
|
PRELIMINARY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Years Ended
|
|
|
|
|
October 31,
|
|
October 31,
|
|
|
|
|
2012
|
Diluted EPS
|
2011
|
Diluted EPS
|
|
2012
|
Diluted EPS
|
2011
|
Diluted EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net income
|
|
$
|
425
|
|
$
|
1.20
|
|
|
$
|
289
|
|
$
|
0.82
|
|
|
$
|
1,153
|
|
$
|
3.27
|
|
|
$
|
1,012
|
|
$
|
2.85
|
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and other related costs - FY2009 Plan
|
|
|
-
|
|
|
-
|
|
|
|
-
|
|
|
-
|
|
|
|
-
|
|
|
-
|
|
|
|
2
|
|
|
0.01
|
|
|
|
Asset impairments and write-downs
|
|
|
1
|
|
|
-
|
|
|
|
-
|
|
|
-
|
|
|
|
16
|
|
|
0.05
|
|
|
|
9
|
|
|
0.02
|
|
|
|
Intangible amortization
|
|
|
52
|
|
|
0.15
|
|
|
|
28
|
|
|
0.08
|
|
|
|
137
|
|
|
0.39
|
|
|
|
113
|
|
|
0.32
|
|
|
|
Transformational initiatives
|
|
|
6
|
|
|
0.02
|
|
|
|
18
|
|
|
0.05
|
|
|
|
25
|
|
|
0.07
|
|
|
|
51
|
|
|
0.14
|
|
|
|
Acquisition and integration costs
|
|
|
34
|
|
|
0.10
|
|
|
|
15
|
|
|
0.04
|
|
|
|
88
|
|
|
0.25
|
|
|
|
55
|
|
|
0.16
|
|
|
|
Varian acquisition fair value adjustments
|
|
|
-
|
|
|
-
|
|
|
|
1
|
|
|
-
|
|
|
|
-
|
|
|
-
|
|
|
|
9
|
|
|
0.03
|
|
|
|
Agilent Foundation donation
|
|
|
10
|
|
|
0.03
|
|
|
|
-
|
|
|
-
|
|
|
|
10
|
|
|
0.03
|
|
|
|
6
|
|
|
0.01
|
|
|
|
Other
|
|
|
2
|
|
|
0.01
|
|
|
|
2
|
|
|
0.01
|
|
|
|
(9
|
)
|
|
(0.03
|
)
|
|
|
(18
|
)
|
|
(0.04
|
)
|
|
|
Adjustment for taxes (a)
|
|
|
(227
|
)
|
|
(0.65
|
)
|
|
|
(57
|
)
|
|
(0.16
|
)
|
|
|
(320
|
)
|
|
(0.91
|
)
|
|
|
(194
|
)
|
|
(0.55
|
)
|
Non-GAAP Net Income
|
|
$
|
303
|
|
$
|
0.86
|
|
|
$
|
296
|
|
$
|
0.84
|
|
|
$
|
1,100
|
|
$
|
3.12
|
|
|
$
|
1,045
|
|
$
|
2.95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) The adjustment for taxes excludes tax benefits that management
believes are not directly related to ongoing operations and which
are either isolated or cannot be expected to occur again with any
regularity or predictability. For the year ended October 31, 2012,
management uses a non-GAAP effective tax rate of 16% that we
believe to be indicative of on-going operations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Historical amounts are reclassified to conform with current period
presentation.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
We provide non-GAAP net income and non-GAAP net income per share
amounts in order to provide meaningful supplemental information
regarding our operational performance and our prospects for the
future. These supplemental measures exclude, among other things,
charges related to the amortization of intangibles, the impact of
restructuring charges and acquisition and integration costs. Some of
the exclusions, such as impairments, may be beyond the control of
management. Further, some may be less predictable than revenue
derived from our core businesses (the day to day business of selling
our products and services). These reasons provide the basis for
management's belief that the measures are useful.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Our management uses non-GAAP measures to evaluate the performance of
our core businesses, to estimate future core performance and to
compensate employees. Since management finds this measure to be
useful, we believe that our investors benefit from seeing our
results "through the eyes" of management in addition to seeing our
GAAP results. This information facilitates our management's internal
comparisons to our historical operating results as well as to the
operating results of our competitors.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Our management recognizes that items such as amortization of
intangibles and restructuring charges can have a material impact on
our cash flows and/or our net income. Our GAAP financial statements
including our statement of cash flows portray those effects.
Although we believe it is useful for investors to see core
performance free of special items, investors should understand that
the excluded items are actual expenses that may impact the cash
available to us for other uses. To gain a complete picture of all
effects on the company's profit and loss from any and all events,
management does (and investors should) rely upon the GAAP income
statement. The non-GAAP numbers focus instead upon the core business
of the company, which is only a subset, albeit a critical one, of
the company's performance.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Readers are reminded that non-GAAP numbers are merely a supplement
to, and not a replacement for, GAAP financial measures. They should
be read in conjunction with the GAAP financial measures. It should
be noted as well that our non-GAAP information may be different from
the non-GAAP information provided by other companies.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The preliminary non-GAAP net income and diluted EPS reconciliation
is estimated based on our current information.
|
|
Page 5
|
|
|
AGILENT TECHNOLOGIES, INC.
|
SEGMENT INFORMATION
|
(In millions, except where noted)
|
(Unaudited)
|
PRELIMINARY
|
|
|
|
|
|
|
|
Life Sciences
|
|
|
|
|
|
|
|
|
Q4'12
|
|
Q4'11
|
|
Q3'12
|
Orders
|
|
$
|
417
|
|
|
$
|
433
|
|
|
$
|
373
|
|
Revenues
|
|
$
|
401
|
|
|
$
|
402
|
|
|
$
|
391
|
|
Gross Margin, %
|
|
|
53
|
%
|
|
|
49
|
%
|
|
|
51
|
%
|
Income from Operations
|
|
$
|
71
|
|
|
$
|
57
|
|
|
$
|
57
|
|
Segment Assets
|
|
$
|
1,477
|
|
|
$
|
1,479
|
|
|
$
|
1,462
|
|
Return On Invested Capital (a), %
|
|
|
21
|
%
|
|
|
16
|
%
|
|
|
17
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chemical Analysis
|
|
|
|
|
|
|
|
|
Q4'12
|
|
Q4'11
|
|
Q3'12
|
Orders
|
|
$
|
421
|
|
|
$
|
421
|
|
|
$
|
372
|
|
Revenues
|
|
$
|
394
|
|
|
$
|
405
|
|
|
$
|
381
|
|
Gross Margin, %
|
|
|
53
|
%
|
|
|
52
|
%
|
|
|
50
|
%
|
Income from Operations
|
|
$
|
97
|
|
|
$
|
97
|
|
|
$
|
80
|
|
Segment Assets
|
|
$
|
1,768
|
|
|
$
|
1,772
|
|
|
$
|
1,739
|
|
Return On Invested Capital (a), %
|
|
|
22
|
%
|
|
|
22
|
%
|
|
|
18
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Electronic Measurement
|
|
|
|
|
|
|
|
|
Q4'12
|
|
Q4'11
|
|
Q3'12
|
Orders
|
|
$
|
755
|
|
|
$
|
822
|
|
|
$
|
811
|
|
Revenues
|
|
$
|
816
|
|
|
$
|
855
|
|
|
$
|
845
|
|
Gross Margin, %
|
|
|
57
|
%
|
|
|
58
|
%
|
|
|
56
|
%
|
Income from Operations
|
|
$
|
189
|
|
|
$
|
209
|
|
|
$
|
197
|
|
Segment Assets
|
|
$
|
2,157
|
|
|
$
|
2,156
|
|
|
$
|
2,184
|
|
Return On Invested Capital (a), %
|
|
|
41
|
%
|
|
|
45
|
%
|
|
|
43
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diagnostics and Genomics
|
|
|
|
|
|
|
|
|
Q4'12
|
|
Q4'11
|
|
Q3'12
|
Orders
|
|
$
|
158
|
|
|
$
|
76
|
|
|
$
|
106
|
|
Revenues
|
|
$
|
156
|
|
|
$
|
69
|
|
|
$
|
106
|
|
Gross Margin, %
|
|
|
63
|
%
|
|
|
63
|
%
|
|
|
61
|
%
|
Income from Operations
|
|
$
|
26
|
|
|
$
|
11
|
|
|
$
|
16
|
|
Segment Assets
|
|
$
|
2,595
|
|
|
$
|
358
|
|
|
$
|
2,645
|
|
Return On Invested Capital (a), %
|
|
|
3
|
%
|
|
|
11
|
%
|
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations reflect the results of our reportable
segments under Agilent's management reporting system which are not
necessarily in conformity with GAAP financial measures. Income from
operations of our reporting segments exclude, among other things,
charges related to the amortization of intangibles, the impact of
restructuring charges, acquisition and integration costs.
|
|
|
|
|
|
|
|
In general, recorded orders represent firm purchase commitments from
our customers with established terms and conditions for products and
services that will be delivered within six months.
|
|
|
|
|
|
|
|
(a) Return On Invested Capital is a non-GAAP measure and
is defined as income from operations less other (income) expense and
taxes, annualized, divided by the average of the two most recent
quarter-end balances of assets less net current liabilities. The
reconciliation of ROIC can be found on page 7 of these tables, along
with additional information regarding the use of this non-GAAP
measure.
|
|
|
|
|
|
|
|
Readers are reminded that non-GAAP numbers are merely a supplement
to, and not a replacement for, GAAP financial measures. They should
be read in conjunction with the GAAP financial measures. It should
be noted as well that our non-GAAP information may be different from
the non-GAAP information provided by other companies.
|
|
|
|
|
|
|
|
The preliminary segment information is estimated based on our
current information.
|
|
Page 6
|
|
|
AGILENT TECHNOLOGIES, INC.
|
RECONCILIATION OF ROIC
|
(In millions)
|
(Unaudited)
|
PRELIMINARY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LSG
|
CAG
|
EMG
|
DGG
|
Agilent
|
|
LSG
|
CAG
|
EMG
|
DGG
|
Agilent
|
|
LSG
|
CAG
|
EMG
|
DGG
|
Numerator:
|
|
Q4'12
|
Q4'12
|
Q4'12
|
Q4'12
|
Q4'12
|
|
Q4'11
|
Q4'11
|
Q4'11
|
Q4'11
|
Q4'11
|
|
Q3'12
|
Q3'12
|
Q3'12
|
Q3'12
|
Non-GAAP income from operations
|
|
$
|
71
|
|
$
|
97
|
|
$
|
189
|
|
$
|
26
|
|
$
|
383
|
|
|
$
|
57
|
|
$
|
97
|
|
$
|
209
|
|
$
|
11
|
|
$
|
373
|
|
|
$
|
57
|
|
$
|
80
|
|
$
|
197
|
|
$
|
16
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxes and Other (income)/expense
|
|
|
11
|
|
|
15
|
|
|
28
|
|
|
5
|
|
|
59
|
|
|
|
9
|
|
|
16
|
|
|
35
|
|
|
2
|
|
|
60
|
|
|
|
8
|
|
|
12
|
|
|
30
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment return
|
|
|
60
|
|
|
82
|
|
|
161
|
|
|
21
|
|
|
324
|
|
(a)
|
|
48
|
|
|
81
|
|
|
174
|
|
|
9
|
|
|
313
|
|
(a)
|
|
49
|
|
|
68
|
|
|
167
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment return annualized
|
|
$
|
240
|
|
$
|
328
|
|
$
|
644
|
|
$
|
84
|
|
$
|
1,296
|
|
|
$
|
192
|
|
$
|
324
|
|
$
|
696
|
|
$
|
36
|
|
$
|
1,252
|
|
|
$
|
196
|
|
$
|
272
|
|
$
|
668
|
|
$
|
52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Denominator:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment assets (b)
|
|
$
|
1,477
|
|
$
|
1,768
|
|
$
|
2,157
|
|
$
|
2,595
|
|
$
|
7,999
|
|
|
$
|
1,479
|
|
$
|
1,772
|
|
$
|
2,156
|
|
$
|
358
|
|
$
|
5,767
|
|
|
$
|
1,462
|
|
$
|
1,739
|
|
$
|
2,184
|
|
$
|
2,645
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net current liabilities (c)
|
|
|
312
|
|
|
246
|
|
|
584
|
|
|
91
|
|
|
1,234
|
|
|
|
320
|
|
|
262
|
|
|
616
|
|
|
44
|
|
|
1,243
|
|
|
|
299
|
|
|
235
|
|
|
600
|
|
|
77
|
|
Invested capital
|
|
$
|
1,165
|
|
$
|
1,522
|
|
$
|
1,573
|
|
$
|
2,504
|
|
$
|
6,765
|
|
|
$
|
1,159
|
|
$
|
1,510
|
|
$
|
1,540
|
|
$
|
314
|
|
$
|
4,524
|
|
|
$
|
1,163
|
|
$
|
1,504
|
|
$
|
1,584
|
|
$
|
2,568
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average invested capital
|
|
$
|
1,164
|
|
$
|
1,513
|
|
$
|
1,579
|
|
$
|
2,536
|
|
$
|
6,790
|
|
|
$
|
1,176
|
|
$
|
1,505
|
|
$
|
1,557
|
|
$
|
314
|
|
$
|
4,554
|
|
|
$
|
1,149
|
|
$
|
1,488
|
|
$
|
1,555
|
|
$
|
2,551
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROIC
|
|
|
21
|
%
|
|
22
|
%
|
|
41
|
%
|
|
3
|
%
|
|
19
|
%
|
|
|
16
|
%
|
|
22
|
%
|
|
45
|
%
|
|
11
|
%
|
|
27
|
%
|
|
|
17
|
%
|
|
18
|
%
|
|
43
|
%
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROIC calculation:(annualized current quarter segment
return)/(average of the two most recent quarter-end balances of
Segment Invested Capital)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Agilent return is equal to non-GAAP net income of
$303 million plus net interest expense after tax of $21 million
for Q4'12, and $296 million plus net interest expense after tax of
$17 million for Q4'11. Please see "Non-GAAP Net Income and Diluted
EPS Reconciliations" for a reconciliation of non-GAAP net income
to GAAP net income.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b) Segment assets consist of inventory, accounts
receivable, property plant and equipment, gross goodwill and other
intangibles, deferred taxes and allocated corporate assets.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c) Includes accounts payable, employee compensation and
benefits, deferred revenue, certain other accrued liabilities and
allocated corporate liabilities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on Invested Capital (ROIC) is a non-GAAP measure that
management believes provides useful supplemental information for
management and the investor. ROIC is a tool by which we track how
much value we are creating for our shareholders. Management uses
ROIC as a performance measure for our businesses, and our senior
managers' compensation is linked to ROIC improvements as well as
other performance criteria. We believe that ROIC provides our
management with a means to analyze and improve their business,
measuring segment profitability in relation to net asset
investments. We acknowledge that ROIC may not be calculated the same
way by every company. When we complete major acquisitions, we may
adjust invested capital for the relevant segment in the quarter when
the acquisition occurred. We compensate for this limitation by
monitoring and providing to the reader a full GAAP income statement
and balance sheet.
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Readers are reminded that non-GAAP numbers are merely a supplement
to, and not a replacement for, GAAP financial measures. They should
be read in conjunction with the GAAP financial measures. It should
be noted as well that our non-GAAP information may be different from
the non-GAAP information provided by other companies.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The preliminary reconciliation of ROIC is estimated based on our
current information.
|
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|
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Page 7
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