Highlights:
-
GAAP net income of $25 million, or $0.07 per share
-
Non-GAAP earnings of $111 million, or $0.32 per share(1)
-
Positive operating cash flow of $208 million in quarter
-
Revenue of $1.17 billion, down 21 percent from last year; orders of
$1.27 billion, down 11 percent from one year ago
-
Restructuring actions on track to achieve $525 million of annualized
savings by mid-2010
SANTA CLARA, Calif.--(BUSINESS WIRE)--Nov. 13, 2009--
Agilent Technologies Inc. (NYSE:A) today reported revenues of $1.17
billion for the fourth fiscal quarter ended Oct. 31, 2009, 21 percent
below one year ago. Fourth quarter GAAP net income was $25 million, or
$0.07 per diluted share. Last year’s fourth quarter GAAP net income was
$231 million, or $0.64 per share.
During the fourth quarter, Agilent had restructuring and asset
impairment charges of $60 million and $10 million of non-cash
amortization. Excluding these items and $16 million of other net
charges, Agilent reported fourth quarter adjusted net income of $111
million, or $0.32 per share. On a comparable basis, the company earned
$223 million, or $0.62 per share, one year ago.
“Agilent had a relatively strong finish to an extraordinarily difficult
year,” said Bill Sullivan, Agilent president and chief executive.
“Fourth quarter revenues of $1.17 billion were off 21 percent from one
year ago but were above our expectations, and up 10 percent from the
third quarter. Fourth quarter orders of $1.27 billion were off only 11
percent from last year and up 19 percent sequentially.”
“Non-GAAP earnings of $0.32 per share were well above our expectations,
demonstrating the leverage we’re seeing from small improvements in
volume. Our restructuring actions to lower Agilent’s revenue breakeven
by over half a billion dollars contributed meaningfully to this
quarter’s results.”
Electronic Measurement revenues were down 29 percent, with some signs of
a turnaround in general products but continued weakness in
communications products. Orders were down a less severe 18 percent from
one year ago and were up a stronger than seasonal 18 percent from Q3.
Bio-analytical segment revenues were 9 percent below last year, with
applied markets down 10 percent and life science off 7 percent.
Bio-analytical segment orders were off only 1 percent from last year and
were up 20 percent sequentially.
Fourth quarter Return On Invested Capital(2) fell to 18
percent compared with 31 percent one year ago because of lower earnings.
Inventory Days On Hand were off only six days from last year’s record
lows, while Receivables Days Sales Outstanding improved by one day to a
new fourth quarter low. The company generated $208 million of cash from
operations during the fourth quarter. It also raised $750 million in
three- and six-year notes, and ended the quarter with net cash of $1,215
million.
Looking ahead, Sullivan said, “While it seems clear that we are past the
worst of the global downturn, the pace of recovery is expected to be
slow and to vary considerably by market and geography. Our restructuring
actions to achieve $525 million of annualized savings by mid-2010 are on
track and, in recognition of the progress we are making, we have
restored full pay around the world effective Nov. 1.
“We expect our fiscal first quarter revenues to be roughly flat with one
year ago, while our Non-GAAP earnings(3) are expected to be
in the range of $0.28 - $0.32, improved by $0.08 - $0.12 per share
compared to last year.”
During the quarter, Agilent continued to work with U.S. and EU
regulatory authorities on its proposed acquisition of Varian, Inc. for
$1.5 billion. At this point, closing is anticipated early in calendar
2010.
Segment Results
|
Bio-Analytical Measurement
|
|
|
|
|
|
|
|
|
|
|
($ millions except where noted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4:F09
|
|
|
Q3:F09
|
|
|
Q4:F08
|
|
Orders
|
|
|
590
|
|
|
493
|
|
|
596
|
|
Revenues
|
|
|
544
|
|
|
496
|
|
|
594
|
|
Gross Margin, %
|
|
|
55%
|
|
|
53%
|
|
|
56%
|
|
Income from Operations
|
|
|
109
|
|
|
91
|
|
|
136
|
|
Segment Assets
|
|
|
1,482
|
|
|
1,449
|
|
|
1,505
|
|
Return On Invested Capital(2), %
|
|
|
31%
|
|
|
25%
|
|
|
36%
|
|
|
|
|
|
|
|
|
|
|
|
Bio-analytical segment orders of $590 million were down only 1 percent
from one year earlier, and were up 20 percent sequentially from the
third quarter. Revenues of $544 million were off 9 percent from last
year and up 10 percent sequentially. During the quarter, Chemical
Analysis revenues were down 10 percent from last year, with continued
strength in food markets and weakness in most other applied markets.
Life Sciences revenues were off 7 percent from one year ago.
Geographically, weakness was most pronounced in the U.S. and Europe,
which were off 12 percent and 11 percent, respectively, from one year
ago. Asia was generally flat, with Japan up 2 percent and other Asia off
1 percent. China revenues were flat versus last year but only because of
an extraordinary surge in volumes last year related to food safety
issues; fourth quarter orders in China were 30 percent above one year
ago.
Life Sciences revenues of $256 million were down 7 percent in the fourth
quarter from one year ago, with spending by Pharma and Biotech customers
down 8 percent, and sales to the academic and government markets off 4
percent from one year ago. There were some signs of thawing in the
worldwide Pharma market, and interest for the new 1290 Infinity LC
introduced in July has exceeded expectations.
Chemical Analysis revenues of $288 million were down 10 percent from
last year. Food safety remained robust, with revenues up 19 percent from
one year ago. Consumables and services were stable compared with one
year ago, while weakness remained widespread in other applied markets.
From a platform perspective, demand remained weak for GCs and relatively
strong for high-end LC/MS systems.
Fourth quarter segment income from operations of $109 million was $27
million below last year’s results on a $50 million decline in revenues.
Gross margins were off 1 point from last year, while operating margins,
at 20 percent, were down 3 points from the prior year’s record
performance. Segment Return On Invested Capital(2) declined 5
points to 31 percent.
|
Electronic Measurement
|
|
|
|
|
|
|
|
|
|
|
($ millions except where noted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4:F09
|
|
|
Q3:F09
|
|
|
Q4:F08
|
|
Orders
|
|
|
641
|
|
|
542
|
|
|
785
|
|
Revenues
|
|
|
582
|
|
|
524
|
|
|
815
|
|
Gross Margin, %
|
|
|
57%
|
|
|
54%
|
|
|
59%
|
|
Income from Operations
|
|
|
41
|
|
|
(1)
|
|
|
136
|
|
Segment Assets
|
|
|
1,729
|
|
|
1,722
|
|
|
2,014
|
|
Return On Invested Capital(2), %
|
|
|
12%
|
|
|
0%
|
|
|
35%
|
|
|
|
|
|
|
|
|
|
|
|
Fourth quarter Electronic Measurement orders of $641 million were 18
percent below last year and were up a more than seasonal 18 percent
sequentially from Q3. Reflecting earlier orders weakness, revenues of
$582 million were 29 percent below one year ago. General Purpose markets
showed clear signs of bottoming while Communications remained very weak.
Geographically, Europe declined 31 percent, Japan was off 38 percent,
other Asia dropped 24 percent and the Americas were 28 percent below
last year.
General Purpose revenues of $373 million were down 17 percent from last
year but were up 15 percent from Q3. Aerospace / defense held up best,
unchanged compared to one year ago. Other general purpose markets were
off 27 percent from last year due to continued weakness in electronics
manufacturing and computer / semiconductor markets. Communications
revenues of $209 million were down 43 percent from one year ago, with
only investments in LTE, network monitoring, and China 3G infrastructure
showing signs of stabilization.
Fourth quarter segment profit of $41 million was $95 million below last
year on a $233 million decline in revenues – an impressive 41 percent
decremental resulting from rapid actions to reduce structural costs in
this severe downturn. Gross margins fell by less than 2 points from last
year due to lower volume, while operating expenses were $50 million
below last year. Operating margins fell 10 points to 7 percent. Segment
ROIC(2) fell 22 points to 12 percent, driven by lower
profitability and despite $209 million lower invested capital.
|
Semiconductor & Board Test
|
|
|
|
|
|
|
|
|
|
|
($ millions except where noted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4:F09
|
|
|
Q3:F09
|
|
|
Q4:F08
|
|
Orders
|
|
|
43
|
|
|
36
|
|
|
57
|
|
Revenues
|
|
|
41
|
|
|
37
|
|
|
72
|
|
Gross Margin, %
|
|
|
46%
|
|
|
33%
|
|
|
46%
|
|
Income from Operations
|
|
|
(1)
|
|
|
(10)
|
|
|
0
|
|
Segment Assets
|
|
|
355
|
|
|
366
|
|
|
387
|
|
Return On Invested Capital(2), %
|
|
|
(1%)
|
|
|
(9%)
|
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
|
Results in the severely depressed Semiconductor & Board Test segment
improved for the second consecutive quarter. Fourth quarter orders of
$43 million remain 25 percent below one year ago but were 22 percent
ahead of Q3 and nearly double the pace 6 months ago. Revenues of $41
million were off 43 percent from one year ago but up 10 percent from the
third quarter.
Fourth quarter segment loss from operations of $1 million represents a
deterioration of $1 million from last year’s results on a $31 million
decline in revenues. At this point, the segment has completed its
restructuring program and exceeded the original cost reduction goals.
Compared to last year, gross margins were unchanged despite the severe
drop in volume, while operating expenses declined by $12 million from
last year. Segment ROIC(2) fell three points to (1) percent.
About Agilent Technologies
Agilent Technologies Inc. (NYSE: A) is the world’s premier measurement
company and a technology leader in communications, electronics, life
sciences and chemical analysis. The company’s 17,000 employees serve
customers in more than 110 countries. Agilent had net revenues of $4.5
billion in fiscal 2009. Information about Agilent is available on the
Web at www.agilent.com.
Agilent’s management will present more details on its fourth quarter
FY2009 financial results on a conference call with investors beginning
today at 5:30 a.m. (Pacific). This event will be webcast live in
listen-only mode. Listeners may log on at www.investor.agilent.com
and select “Q4 2009 Agilent Technologies Inc. Earnings Conference Call”
in the “News & Events -- Calendar of Events” section. The webcast will
remain available on the company’s Web site for 90 days.
A telephone replay of the conference call will be available from 8:30
a.m. (Pacific) today through Nov. 20, 2009. The replay number is
+1 888 286-8010; international callers may dial +1 617 801-6888. The
passcode is 96035796.
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; revenue and non-GAAP earnings guidance
for the first quarter of fiscal 2010; the planned acquisition of Varian,
Inc. and our planned restructuring activities, including our current
estimates of the scope, timing and cost of those activities. 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, the receipt and timing of regulatory approvals for the Varian
acquisition, satisfaction of closing conditions precedent to the
consummation of the Varian acquisition, unforeseen changes in the
strength of our customers’ businesses, unforeseen changes in the demand
for current and new products and technologies, the risk of additional
costs and delays associated with compliance with U.S. and international
labor and other laws associated with our planned restructuring
activities, the risk that a further decline in general economic
conditions and the global credit and equity markets will require changes
to the planned restructuring, and the risk that we are not able to
realize the savings expected from the restructuring activities.
In addition, other risks that Agilent faces in running its operations
include the ability to execute successfully through business cycles
while it continues to implement cost reductions; 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 to successfully introduce new products at the right time, price
and mix; 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, 2009. 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) Adjusted net income and adjusted net income per share are
non-GAAP measures. Each of these measures is defined to exclude
primarily the impacts of restructuring and asset impairment charges,
business separation costs, non-cash intangibles amortization as well as
disposals of businesses net of their tax effects. A reconciliation
between adjusted 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) Return On Invested Capital is a non-GAAP measure and is
defined as income (loss) 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 6 of the attached tables,
along with additional information regarding the use of this non-GAAP
measure.
(3)Adjusted net income per share as projected for Q110 is a
non-GAAP measure which excludes primarily the impacts of future
restructuring and asset impairment charges and non-cash intangibles
amortization. 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 $10 million per quarter.
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
|
|
|
|
2009
|
|
2008
|
|
|
|
Inc/(Dec)
|
|
|
|
|
|
|
|
|
|
|
|
Orders
|
|
$
|
1,274
|
|
|
$
|
1,438
|
|
|
|
|
(11
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
|
$
|
1,167
|
|
|
$
|
1,481
|
|
|
|
|
(21
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
Cost of products and services
|
|
|
533
|
|
|
|
651
|
|
|
|
|
(18
|
%)
|
|
Research and development
|
|
|
150
|
|
|
|
170
|
|
|
|
|
(12
|
%)
|
|
Selling, general and administrative
|
|
|
413
|
|
|
|
408
|
|
|
|
|
1
|
%
|
|
Total costs and expenses
|
|
|
1,096
|
|
|
|
1,229
|
|
|
|
|
(11
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations
|
|
|
71
|
|
|
|
252
|
|
|
|
|
(72
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
4
|
|
|
|
24
|
|
|
|
|
(83
|
%)
|
|
Interest expense
|
|
|
(21
|
)
|
|
|
(33
|
)
|
|
|
|
(36
|
%)
|
|
Other income (expense), net
|
|
|
25
|
|
|
|
14
|
|
|
|
|
79
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes
|
|
|
79
|
|
|
|
257
|
|
|
|
|
(69
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Provision for taxes
|
|
|
54
|
|
|
|
26
|
|
|
|
|
108
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
25
|
|
|
$
|
231
|
|
|
|
|
(89
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.07
|
|
|
$
|
0.65
|
|
|
|
|
|
|
Diluted
|
|
$
|
0.07
|
|
|
$
|
0.64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares used in computing net income per share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
346
|
|
|
|
355
|
|
|
|
|
|
|
Diluted
|
|
|
350
|
|
|
|
362
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The preliminary income statement is estimated based on our current
information.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AGILENT TECHNOLOGIES, INC. CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS (In millions, except per share
amounts) (Unaudited) PRELIMINARY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended October 31,
|
|
|
|
Percent
|
|
|
|
2009
|
|
2008
|
|
|
|
Inc/(Dec)
|
|
|
|
|
|
|
|
|
|
|
|
Orders
|
|
$
|
4,486
|
|
|
$
|
5,750
|
|
|
|
|
(22
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
|
$
|
4,481
|
|
|
$
|
5,774
|
|
|
|
|
(22
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
Cost of products and services
|
|
|
2,189
|
|
|
|
2,578
|
|
|
|
|
(15
|
%)
|
|
Research and development
|
|
|
642
|
|
|
|
704
|
|
|
|
|
(9
|
%)
|
|
Selling, general and administrative
|
|
|
1,603
|
|
|
|
1,697
|
|
|
|
|
(6
|
%)
|
|
Total costs and expenses
|
|
|
4,434
|
|
|
|
4,979
|
|
|
|
|
(11
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations
|
|
|
47
|
|
|
|
795
|
|
|
|
|
(94
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
29
|
|
|
|
113
|
|
|
|
|
(74
|
%)
|
|
Interest expense
|
|
|
(88
|
)
|
|
|
(123
|
)
|
|
|
|
(28
|
%)
|
|
Other income (expense), net
|
|
|
19
|
|
|
|
30
|
|
|
|
|
(37
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes
|
|
|
7
|
|
|
|
815
|
|
|
|
|
(99
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Provision for taxes
|
|
|
38
|
|
|
|
122
|
|
|
|
|
(69
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
(31
|
)
|
|
$
|
693
|
|
|
|
|
(104
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.09
|
)
|
|
$
|
1.91
|
|
|
|
|
|
|
Diluted
|
|
$
|
(0.09
|
)
|
|
$
|
1.87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares used in computing net income (loss) per
share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
346
|
|
|
|
363
|
|
|
|
|
|
|
Diluted
|
|
|
346
|
|
|
|
371
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The preliminary income statement is estimated based on our current
information.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AGILENT TECHNOLOGIES, INC. CONDENSED CONSOLIDATED
BALANCE SHEET (In millions, except par value and share
amounts) (Unaudited) PRELIMINARY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October 31, 2009
|
|
October 31, 2008
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
2,479
|
|
|
$
|
1,405
|
|
|
Short-term investments
|
|
|
14
|
|
|
|
24
|
|
|
Accounts receivable, net
|
|
|
595
|
|
|
|
770
|
|
|
Inventory
|
|
|
552
|
|
|
|
646
|
|
|
Other current assets
|
|
|
321
|
|
|
|
337
|
|
|
Total current assets
|
|
|
3,961
|
|
|
|
3,182
|
|
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
|
845
|
|
|
|
824
|
|
|
Goodwill
|
|
|
655
|
|
|
|
646
|
|
|
Other intangible assets, net
|
|
|
167
|
|
|
|
228
|
|
|
Restricted cash and cash equivalents
|
|
|
1,566
|
|
|
|
1,582
|
|
|
Long-term investments
|
|
|
163
|
|
|
|
206
|
|
|
Other assets
|
|
|
255
|
|
|
|
339
|
|
|
Total assets
|
|
$
|
7,612
|
|
|
$
|
7,007
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable
|
|
$
|
307
|
|
|
$
|
308
|
|
|
Employee compensation and benefits
|
|
|
336
|
|
|
|
409
|
|
|
Deferred revenue
|
|
|
285
|
|
|
|
280
|
|
|
Income and other taxes payable
|
|
|
26
|
|
|
|
128
|
|
|
Other accrued liabilities
|
|
|
169
|
|
|
|
205
|
|
|
Total current liabilities
|
|
|
1,123
|
|
|
|
1,330
|
|
|
|
|
|
|
|
|
Long-term debt
|
|
|
1,516
|
|
|
|
1,514
|
|
|
Senior notes
|
|
|
1,388
|
|
|
|
611
|
|
|
Retirement and post-retirement benefits
|
|
|
498
|
|
|
|
324
|
|
|
Other long-term liabilities
|
|
|
581
|
|
|
|
669
|
|
|
Total liabilities
|
|
|
5,106
|
|
|
|
4,448
|
|
|
|
|
|
|
|
|
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; 566 million
shares at October 31, 2009 and 561 million shares at October 31,
2008 issued
|
|
|
6
|
|
|
|
6
|
|
|
Treasury stock at cost; 220 million shares at October 31, 2009 and
211 million shares at October 31, 2008
|
|
|
(7,627
|
)
|
|
|
(7,470
|
)
|
|
Additional paid-in capital
|
|
|
7,552
|
|
|
|
7,410
|
|
|
Retained earnings
|
|
|
2,760
|
|
|
|
2,791
|
|
|
Accumulated other comprehensive loss
|
|
|
(185
|
)
|
|
|
(178
|
)
|
|
Total stockholders’ equity
|
|
|
2,506
|
|
|
|
2,559
|
|
|
Total liabilities and stockholders’ equity
|
|
$
|
7,612
|
|
|
$
|
7,007
|
|
|
|
|
|
|
|
|
The preliminary balance sheet is estimated based on our current
information.
|
|
|
|
|
|
|
|
|
|
|
AGILENT TECHNOLOGIES, INC. CONDENSED CONSOLIDATED
STATEMENT OF CASH FLOWS (In millions) (Unaudited) PRELIMINARY
|
|
|
|
|
|
|
|
|
|
Three Months Ended October 31, 2009
|
|
Twelve Months Ended October 31, 2009
|
|
Cash flows from operating activities:
|
|
|
|
|
|
Net income (loss)
|
|
$
|
25
|
|
|
$
|
(31
|
)
|
|
|
|
|
|
|
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities
|
|
|
|
|
|
Depreciation and amortization
|
|
|
39
|
|
|
|
162
|
|
|
Share-based compensation
|
|
|
15
|
|
|
|
71
|
|
|
Deferred taxes
|
|
|
16
|
|
|
|
30
|
|
|
Excess and obsolete and inventory-related charges
|
|
|
6
|
|
|
|
55
|
|
|
Asset impairment charges
|
|
|
2
|
|
|
|
39
|
|
|
Net pension curtailment gains
|
|
|
(3
|
)
|
|
|
(16
|
)
|
|
Net gain on sale of assets and divestitures
|
|
|
(29
|
)
|
|
|
(6
|
)
|
|
Allowance for doubtful accounts
|
|
|
—
|
|
|
|
4
|
|
|
Other
|
|
|
—
|
|
|
|
(2
|
)
|
|
Changes in assets and liabilities:
|
|
|
|
|
|
Accounts receivable
|
|
|
(50
|
)
|
|
|
193
|
|
|
Inventory
|
|
|
10
|
|
|
|
47
|
|
|
Accounts payable
|
|
|
56
|
|
|
|
(7
|
)
|
|
Employee compensation and benefits
|
|
|
54
|
|
|
|
(86
|
)
|
|
Income taxes and other taxes payable
|
|
|
(5
|
)
|
|
|
(106
|
)
|
|
Interest rate swap proceeds
|
|
|
—
|
|
|
|
43
|
|
|
Other assets and liabilities
|
|
|
72
|
|
|
|
13
|
|
|
Net cash provided by operating activities (a) |
|
|
208
|
|
|
|
403
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
Investments in property, plant and equipment
|
|
|
(30
|
)
|
|
|
(128
|
)
|
|
Purchase of investments
|
|
|
—
|
|
|
|
(30
|
)
|
|
Proceeds from sale of investments
|
|
|
13
|
|
|
|
94
|
|
|
Proceeds from divestitures, net
|
|
|
44
|
|
|
|
45
|
|
|
Change in restricted cash and cash equivalents
|
|
|
1
|
|
|
|
15
|
|
|
Purchase of minority interest
|
|
|
(10
|
)
|
|
|
(10
|
)
|
|
Other, net
|
|
|
1
|
|
|
|
(1
|
)
|
|
Net cash provided by (used in) investing activities
|
|
|
19
|
|
|
|
(15
|
)
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
Net issuance of common stock under employee stock plans
|
|
|
23
|
|
|
|
76
|
|
|
Issuance of 4.5% Senior Notes
|
|
|
250
|
|
|
|
250
|
|
|
Issuance of 5.5% Senior Notes
|
|
|
498
|
|
|
|
498
|
|
|
Issuance cost of Senior Notes
|
|
|
(4
|
)
|
|
|
(4
|
)
|
|
Proceeds from revolving credit facility
|
|
|
—
|
|
|
|
325
|
|
|
Repayment of revolving credit facility
|
|
|
—
|
|
|
|
(325
|
)
|
|
Treasury stock repurchases
|
|
|
—
|
|
|
|
(157
|
)
|
|
Net cash provided by financing activities
|
|
|
767
|
|
|
|
663
|
|
|
|
|
|
|
|
|
Effect of exchange rate movements
|
|
|
6
|
|
|
|
23
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
1,000
|
|
|
|
1,074
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at beginning of period
|
|
|
1,479
|
|
|
|
1,405
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
2,479
|
|
|
$
|
2,479
|
|
|
|
|
|
|
|
|
(a) Cash payments included in operating activities:
|
|
|
|
|
|
Restructuring payments
|
|
|
55
|
|
|
|
164
|
|
|
Income tax payments
|
|
|
12
|
|
|
|
112
|
|
|
|
|
|
|
|
|
The preliminary cash flow is estimated based on our current
information.
|
|
|
|
|
|
|
|
|
|
|
AGILENT TECHNOLOGIES, INC. ADJUSTED NET INCOME AND
DILUTED EPS RECONCILIATIONS (In millions, except per
share amounts) (Unaudited) PRELIMINARY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended October 31,
|
|
|
|
Twelve Months Ended October 31,
|
|
|
|
2009
|
|
Diluted EPS
|
|
|
2008
|
|
Diluted EPS
|
|
|
|
2009
|
|
Diluted EPS
|
|
|
2008
|
|
Diluted EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per GAAP
|
|
$
|
25
|
|
|
$
|
0.07
|
|
|
|
$
|
231
|
|
|
$
|
0.64
|
|
|
|
|
$
|
(31
|
)
|
|
$
|
(0.09
|
)
|
|
|
$
|
693
|
|
|
$
|
1.87
|
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and other related costs
|
|
|
50
|
|
|
|
0.14
|
|
|
|
|
5
|
|
|
|
0.01
|
|
|
|
|
|
247
|
|
|
|
0.71
|
|
|
|
|
27
|
|
|
|
0.07
|
|
|
Asset impairments
|
|
|
10
|
|
|
|
0.03
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
44
|
|
|
|
0.13
|
|
|
|
|
1
|
|
|
|
0.01
|
|
|
Acceleration of share-based compensation related to workforce
reduction
|
|
|
1
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
5
|
|
|
|
0.01
|
|
|
|
|
-
|
|
|
|
-
|
|
|
Business disposals
|
|
|
(31
|
)
|
|
|
(0.09
|
)
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
(8
|
)
|
|
|
(0.02
|
)
|
|
|
|
-
|
|
|
|
-
|
|
|
Excess software amortization
|
|
|
-
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
3
|
|
|
|
0.01
|
|
|
Intangible amortization
|
|
|
10
|
|
|
|
0.03
|
|
|
|
|
13
|
|
|
|
0.04
|
|
|
|
|
|
45
|
|
|
|
0.13
|
|
|
|
|
53
|
|
|
|
0.14
|
|
|
Pension curtailment
|
|
|
(3
|
)
|
|
|
(0.01
|
)
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
(16
|
)
|
|
|
(0.05
|
)
|
|
|
|
-
|
|
|
|
-
|
|
|
Net translation gain on liquidation of a subsidiary
|
|
|
-
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
(11
|
)
|
|
|
(0.03
|
)
|
|
Acceleration of debt issuance costs
|
|
|
-
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
13
|
|
|
|
0.04
|
|
|
In process R&D
|
|
|
-
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
2
|
|
|
|
0.01
|
|
|
Litigation settlement
|
|
|
13
|
|
|
|
0.04
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
13
|
|
|
|
0.04
|
|
|
|
|
|
|
|
Patent litigation judgement
|
|
|
-
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
(6
|
)
|
|
|
(0.02
|
)
|
|
|
|
-
|
|
|
|
-
|
|
|
Other
|
|
|
11
|
|
|
|
0.03
|
|
|
|
|
3
|
|
|
|
0.01
|
|
|
|
|
|
23
|
|
|
|
0.07
|
|
|
|
|
8
|
|
|
|
0.02
|
|
|
Adjustment for taxes
|
|
|
25
|
|
|
|
0.08
|
|
|
|
|
(29
|
)
|
|
|
(0.08
|
)
|
|
|
|
|
(36
|
)
|
|
|
(0.11
|
)
|
|
|
|
(60
|
)
|
|
|
(0.18
|
)
|
|
Adjusted net income
|
|
$
|
111
|
|
|
$
|
0.32
|
|
|
|
$
|
223
|
|
|
$
|
0.62
|
|
|
|
|
$
|
280
|
|
|
$
|
0.80
|
|
|
|
$
|
729
|
|
|
$
|
1.96
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
We provide adjusted net income and adjusted 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 the sale of our businesses. 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 adjusted net income and diluted EPS reconciliation
is estimated based on our current information.
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AGILENT TECHNOLOGIES, INC. RECONCILIATION OF ROIC (In
millions) (Unaudited) Preliminary
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Numerator:
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BAM Q4'09
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EM Q4'09
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SBT Q4'09
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Agilent Q4'09
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BAM Q4'08
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EM Q4'08
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SBT Q4'08
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BAM Q3'09
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EM Q3'09
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SBT Q3'09
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Adjusted income(loss) from operations
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$ 109
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$ 41
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$ (1)
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$ 150
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$ 136
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$ 136
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$ -
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$ 91
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$ (1)
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$ (10)
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Less:
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Taxes and Other (income)/expense
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20
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3
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-
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26
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30
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11
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(1)
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18
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(1)
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(3)
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Segment return
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89
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38
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(1)
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124
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(a)
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106
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125
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1
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73
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-
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(7)
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Segment return annualized
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$ 356
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$ 152
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$ (4)
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$ 496
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$ 424
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$ 500
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$ 5
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$ 292
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$ -
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$ (28)
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Denominator:
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Segment assets (b) |
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$ 1,482
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$ 1,729
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$ 355
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$ 3,566
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$ 1,505
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$ 2,014
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$ 387
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$ 1,449
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$ 1,722
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$ 366
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Less:
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Net current liabilities (c) |
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344
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532
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46
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927
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323
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608
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66
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295
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482
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36
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Invested capital
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$ 1,138
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$ 1,197
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$ 309
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$ 2,639
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$ 1,182
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$ 1,406
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$ 321
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$ 1,154
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$ 1,240
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$ 330
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Average invested capital
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$ 1,146
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$ 1,219
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$ 320
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$ 2,683
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$ 1,184
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$ 1,439
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$ 328
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$ 1,190
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$ 1,285
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$ 327
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ROIC
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31%
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12%
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-1%
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18%
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36%
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35%
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2%
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25%
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0%
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-9%
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Historical amounts are reclassified to conform with current period
presentation
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ROIC calculation:(annualized current quarter segment
return)/(average of the two most recent quarter-end balances of
Segment Invested Capital)
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(a)
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Agilent return is equal to adjusted net income from operations of
$111 million plus net interest expense after tax of $13 million. Please
see "Adjusted Net Income and Diluted EPS Reconciliations" for a
reconciliation of adjusted net income from operations to GAAP
income(loss) from operations.
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(b)
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Segment assets consist of inventory, accounts receivable, property
plant and equipment, gross goodwill and other intangibles,
deferred taxes and allocated corporate assets.
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(c)
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Includes accounts payable, employee compensation and benefits,
deferred revenue, other accrued liabilities and allocated
corporate liabilities.
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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. 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.
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The preliminary reconciliation of ROIC is estimated based on our
current information.
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Source: Agilent Technologies Inc.
Amy Flores, +1-408-345-8194
amy_flores@agilent.com
Alicia Rodriguez, +1-408-345-8948
alicia_rodriguez@agilent.com