ST. LOUIS, April 26, 2011 /PRNewswire/ --
HIGHLIGHTS:
2011 Results (all percentages are to comparable periods in
2010)
- Q1 2011 reported sales increased 10% to $632 million, a new quarterly high. Q1 sales grew
organically by 7%, with Fine Chemicals ("SAFC") and Research
product sales growing organically by 16% and 4%,
respectively.
- Q1 2011 reported diluted EPS was $0.97, also a new quarterly high. A strong
operating margin, a tax benefit of $0.04, partially offset by restructuring costs of
$0.01 drove adjusted Q1 2011 diluted
EPS to $0.94, a 12% increase over
comparable Q1 2010 results.
- Q1 2011 net cash provided by operating activities and free
cash flow were $151 million and
$133 million, respectively.
2011 Outlook (all percentages are compared to full year 2010
results)
- Organic sales for the full year are expected to meet the
Company's previously forecast increase in a mid-single digit range.
At current exchange rates, currency is expected to increase
otherwise reportable sales for the full year by approximately 4%.
Acquisitions are expected to increase sales by another 1%,
resulting in reportable sales growth in the low double digits.
- Diluted adjusted EPS forecast for 2011 was raised by
$0.15 to a new range of $3.60 to $3.75, a 9% to 13% increase compared to
2010's adjusted diluted EPS of $3.31,
based on stronger Q1 operating performance, more favorable currency
exchange rates and a tax rate of 29 to 30% . See 2011 Outlook
below.
- Net cash provided by operating activities and free cash flow
are expected to exceed $520 million
and $400 million, respectively, for
2011.
CEO's STATEMENT:
Commenting on first quarter 2011 performance, President and CEO
Rakesh Sachdev said: "Our
reported sales of $632 million and
diluted EPS of $0.97 for the first
quarter of 2011 were the best reported quarterly results in our
history. We are very pleased with this strong performance as
we begin 2011. Our SAFC sales grew by 16% on an organic basis
driven by continued strong demand for materials and precursors for
semi-conductor and L.E.D. applications and for industrial cell
culture media used for producing biological drugs. Our
research initiatives in analytical chemistry, biology, traditional
chemistry and materials science, coupled with a 2% acquisition
benefit to expand our analytical chemistry offering, helped achieve
currency adjusted growth of 6% in our Research business.
We continued to expand our product offering with the addition of
over 3,000 high quality analytical reference standards through the
acquisitions of Cerilliant Corporation and Resource Technology
Corporation, a new suite of knockout rats to model Parkinson's
disease, new diagnostic raw materials for point of care and over
the counter diagnostic kits and the addition of 1,400 new cell
lines from the European Cell Culture Collection. We also
launched the first phase of our new web site with an enhanced
scientific workflow to help researchers more easily find
information, tools, products and services needed to accelerate
research and discovery."
Sachdev continued, "We've reaffirmed our organic sales growth
expectation for 2011 of mid-single digit percentage growth.
This organic growth, along with benefits from currency and
acquisitions are expected to drive overall growth to low double
digits. We've also raised our diluted adjusted EPS outlook
for 2011 to a new range of $3.60 to
$3.75 as a result of stronger operational performance in the
first quarter and more favorable foreign currency exchange rates.
Our commitment to continuous improvement is expected to
ensure that we deliver flawless execution of our strategic
initiatives to drive sales of our analytical chemistry, biology,
traditional chemistry and materials science products, to deliver
high single digit organic growth in SAFC for the full year and to
enhance our e-commerce and Asia Pacific-Latin American market
sales. All of these efforts are intended to boost sales growth
above the underlying market rate. Let me assure you that our
management team is fully engaged and committed to deliver this
performance."
2011 RESULTS:
Reported sales for the first quarter of 2011 of $632 million increased 10% from the first quarter
of 2010. Excluding changes in foreign currency exchange rates
and acquisitions that increased overall sales by 2% and 1%,
respectively, first quarter organic sales growth was 7%.
First quarter sales for the Company's Research business grew
organically by 4% with organic sales growth in the Asia
Pacific-Latin American and European markets of 7% and 4%,
respectively. First quarter sales for the Company's SAFC
business grew 16% on a currency-adjusted basis as sales of our
Supply Solutions, Bioscience and Hitech products again reflected
stronger demand. A reconciliation of reported to adjusted (organic)
sales is on page 8.
The operating income margin in the first quarter of 2011 was
26.4% of sales, compared to 25.7% of sales reported in the first
quarter of 2010. Excluding restructuring costs, the operating
income margin in the first quarter of 2011 was 26.9%, roughly in
line with the 26.7% adjusted operating margin achieved in the first
quarter of 2010. During the first quarter of 2011, we made
additional investments of $3 million
in initiatives that are expected to drive future sales growth at
above market rates and in operational improvements including the
opening of a European Headquarters in Switzerland. Restructuring costs of
$3 million in 2011's first quarter
related to the previously announced consolidation of certain
manufacturing facilities in the U.S. and Europe. These restructuring actions reflect
the Company's efforts to improve operating efficiencies and lower
its fixed cost structure as part of a longer term goal to improve
operating margins.
The effective tax rate for the first quarter of 2011 was 27.9%
compared to 31.0% in the first quarter of 2010. The lower tax
rate in the first quarter of 2011 resulted from the resolution and
related release of certain tax contingencies amounting to
$0.04 per diluted share. A
non-recurring income tax charge in the first quarter of 2010
related to the non-deductibility of expenses reimbursed under
Medicare Part D drove that period's tax rate to 31%. The
effective tax rate for all of 2011 is expected to be approximately
29% to 30% of pretax income.
Free cash flow (defined in the Consolidated Statement of Cash
Flows) for the first quarter of 2011 was $133 million, comparable to that in the first
quarter of 2010. Higher net income was largely offset by a higher
level of working capital to support growth in the faster
growing international markets. A reconciliation of net cash
provided by operating activities to free cash flow is in the below
Supplemental Financial Information.
Other highlights from global sales growth initiatives
include:
- Worldwide sales of research products through the Company's
award winning web site as a percentage of total research sales were
50% for the first quarter of 2011, up from 49% in the fourth
quarter of 2010 and 48% for the full year 2010.
- Sales in International markets (Asia
Pacific and Latin America)
continued to show strength with reported and organic growth of 18%
and 11%, respectively, in the first quarter of 2011. In the
Company's focus markets of China,
India and Brazil, sales collectively grew 25% and 21% on
a reported and organic basis, respectively, for the first quarter
of 2011. The recent tragic events in Japan did not have a significant effect on the
consolidated sales of the Company or our business in the
Asia Pacific region.
- SAFC's booked orders for future delivery at March 31, 2011 reached a record level and were 5%
above the March 31, 2010 level.
2011 OUTLOOK:
- Organic sales growth is expected to be in the mid-single digit
range for 2011, unchanged from our previous outlook. Significant
factors in our sales outlook include:
- Programs to enhance and highlight the product capabilities of
our research business in analytical chemistry, biology, traditional
chemistry and materials science, continued emphasis on growth
opportunities in fine chemicals, in international markets and in
e-commerce are all expected to enable us to achieve 2011 sales
growth at above market rates.
- Market conditions are not expected to change much from
2010.
- At current exchange rates, currency is expected to increase
reported sales growth by about 4% over the prior year.
- The recently completed acquisitions of Cerilliant Corporation
and Resource Technology Corporation are expected to contribute
approximately 1% to overall sales growth.
- Our forecast for diluted adjusted earnings per share for 2011
is expected to be $3.60 to $3.75, up
from our previous outlook of $3.45 to
$3.60.
- This increase reflects stronger first quarter operating
performance and a more favorable foreign currency exchange
environment.
- Included in this outlook are pretax expenses equivalent to
$18 million, or $0.10 per share for strategic initiatives that
are expected to boost our longer term organic sales growth.
- The effective tax rate in 2011 is expected to be approximately
29% to 30%, including a benefit from the U.S. R & D tax credit
comparable to that realized in 2010.
- Recent acquisitions are expected to be neutral to mildly
accretive to our diluted earnings per share in 2011.
- This EPS outlook excludes the impact of restructuring and other
extraordinary special charges.
- Management expects free cash flow for 2011 to be in excess of
$400 million, a $25 million increase from our previous outlook.
- Net cash provided by operating activities is expected to exceed
$520 million.
- Capital expenditures are expected to be approximately
$120 million.
- Working capital management initiatives are expected to be
continued, with inventory levels increased at select international
locations to support anticipated growth.
OTHER INFORMATION:
Cash Flow and Debt: Net cash provided by operating
activities for the first quarter of 2011 was $151 million, comparable to the first quarter of
2010. Higher net income and non-cash charges in the first
quarter of 2011 compared to the first quarter of 2010 were largely
offset by higher uses of cash for accounts receivable and
inventory. Capital expenditures in the first quarter of each
of 2011 and 2010 were $18 million.
Inventory levels were 6.5 months at March
31, 2011 compared to 6.2 months at March 31, 2010, in line with expectations. Free
cash flow of $133 million for the
first quarter of 2011 was used to return $43
million to shareholders through share repurchases and
dividends, repay $50 million in debt
and fund acquisitions of $20 million.
The Company's debt to capital ratio was reduced to 19% at
March 31, 2011 from 21% at
December 31, 2010.
Share Repurchase: Another 0.3 million shares
were acquired in the first quarter of 2011 at an average share
price of $62.95. There were 122
million shares outstanding at March 31,
2011. The Company expects to continue to offset the dilutive
impact of issuing share based incentive compensation with future
repurchases. The Company may repurchase additional shares, but the
timing and amount will depend upon market conditions and other
factors.
Cautionary Statement: This release contains
forward-looking statements relating to future performance, goals,
strategic actions and initiatives and similar intentions and
beliefs, including phrases "is expected", "reaffirmed,", "plans",
"to drive", "to boost", "to enhance", "are intended" and other
statements regarding the Company's expectations, goals, beliefs,
intentions and the like regarding future sales, earnings, free cash
flow, share repurchases, acquisitions and other matters. These
statements are based on assumptions regarding Company operations,
investments and acquisitions and conditions in the markets the
Company serves. The Company believes these assumptions are
reasonable and well founded. The forward-looking statements in this
release are subject to risks and uncertainties, including, among
others, certain economic, political and technological factors.
Actual results could differ materially from those stated or implied
in this news release, due to, but not limited to, such factors as
(1) global economic conditions, (2) changes in pricing and the
competitive environment and the global demand for our products, (3)
fluctuations in foreign currency exchange rates, (4) changes in
research funding and the success of research and development
activities, (5) failure of planned sales initiatives in our
Research and SAFC businesses, (6) dependence on uninterrupted
manufacturing operations, (7) failure to achieve planned cost
reductions in global supply chain initiatives and restructuring
actions, (8) changes in the regulatory environment in which the
Company operates, (9) changes in worldwide tax rates or tax
benefits from domestic and international operations, including the
matters described in Note 10-Income Taxes-to the Consolidated
Financial Statements in the Company's Form 10-K report for the year
ended December 31, 2010, (10)
exposure to litigation, including product liability claims, (11)
the ability to maintain adequate quality standards, (12) reliance
on third party package delivery services, (13) an unanticipated
increase in interest rates, (14) other changes in the business
environment in which the Company operates, and (15) the outcome of
the outstanding matters described in Note 11-Contingent Liabilities
and Commitments-to the Consolidated Financial Statements in the
Company's Form 10-K report for the year ended December 31, 2010. A further discussion of the
Company's risk factors can be found in Item 1A of Part 1 of the
Company's Form 10-K report for the year ended December 31, 2010. The Company does not
undertake any obligation to update these forward-looking
statements.
About Sigma-Aldrich: Sigma-Aldrich is a leading Life
Science and High Technology company. Our
biochemical and organic chemical products and kits are used in
scientific research, including genomic and proteomic research,
biotechnology, pharmaceutical development, and as key components in
pharmaceutical, diagnostic and other high technology manufacturing.
We have customers in life science companies, university and
government institutions, hospitals and in industry. Over one
million scientists and technologists use our products.
Sigma-Aldrich operates in 40 countries and has 8,000
employees providing excellent service worldwide. We are
committed to accelerating our Customers' success through leadership
in Life Science, High Technology and
Service. For more information about
Sigma-Aldrich, please visit our award winning web site at
www.sigma-aldrich.com.
Non-GAAP Financial Measures: The Company supplements its
disclosures made in accordance with accounting principles generally
accepted in the United States
("U.S. GAAP") with certain non-GAAP financial measures. The
Company does not, and does not suggest investors should, consider
such non-GAAP financial measures in isolation from, or as a
substitute for, GAAP financial information. These non-GAAP
measures may not be consistent with the presentation by similar
companies in the Company's industry. Whenever the Company
uses such non-GAAP measures, it provides a reconciliation of such
measures to the most closely applicable GAAP measure. See the
Supplemental Financial Information on pages 8 and 9 for these
reconciliations.
With over 60% of sales denominated in currencies other than the
U.S. dollar, management uses currency adjusted growth, and believes
it is useful to investors, to judge the Company's local currency
performance. Organic sales growth data presented in this
release excludes currency and acquisitions impacts. The Company
calculates the impact of changes in foreign currency rates by
multiplying current period activity by the difference between
current period exchange rates and prior period exchange rates, the
result is the defined impact of "changes in foreign currency
exchange rates". While we are able to report currency impacts after
the fact, we are unable to estimate changes that may occur later in
2011 to applicable exchange rates. Any significant changes in
currency exchange rates would likely have a significant impact on
our reported growth rates due to the volume of our sales
denominated in foreign currencies.
Management also uses adjusted net income and EPS and adjusted
operating income and operating income margins (reconciled in the
Supplemental Financial Information) and free cash flow (defined
below), non-GAAP measures, to judge its performance and ability
to pursue opportunities that enhance shareholder value. Due to
the uncertain timing of future restructuring and other
extraordinary special charges, we are unable to include these
charges in the 2011 diluted adjusted EPS forecast or provide a
reconciliation to the corresponding GAAP measures. Management
believes this non-GAAP information is useful to investors as well.
SIGMA-ALDRICH
CORPORATION
|
|
Consolidated
Statements of Income (Unaudited)
|
|
(in millions
except per share amounts)
|
|
|
|
|
|
|
|
|
|
Three
Months
|
|
|
|
Ended March
31,
|
|
|
|
2011
|
|
2010
|
|
Net sales
|
|
$
632
|
|
$
572
|
|
Cost of products
sold
|
|
296
|
|
269
|
|
Gross profit
|
|
336
|
|
303
|
|
Selling, general and
administrative expenses
|
|
148
|
|
134
|
|
Research and development
expenses
|
|
18
|
|
16
|
|
Restructuring
costs
|
|
3
|
|
6
|
|
Operating income
|
|
167
|
|
147
|
|
Interest, net
|
|
2
|
|
2
|
|
Income before income
taxes
|
|
165
|
|
145
|
|
Provision for income
taxes
|
|
46
|
|
45
|
|
Net income
|
|
$
119
|
|
$
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share -
Basic
|
|
$
0.98
|
|
$
0.82
|
|
Net income per share -
Diluted
|
|
$
0.97
|
|
$
0.81
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of
shares outstanding - Basic
|
|
122
|
|
122
|
|
Weighted average number of
shares outstanding - Diluted
|
|
123
|
|
123
|
|
|
|
|
|
|
SIGMA-ALDRICH
CORPORATION
|
|
Consolidated
Balance Sheets
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
2011
|
|
2010
|
|
Assets
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
623
|
|
$
569
|
|
Accounts receivable,
net
|
|
343
|
|
287
|
|
Inventories
|
|
638
|
|
606
|
|
Other current
assets
|
|
122
|
|
139
|
|
Total current
assets
|
|
1,726
|
|
1,601
|
|
|
|
|
|
|
|
Property, plant and equipment,
net
|
|
742
|
|
733
|
|
Goodwill, net
|
|
446
|
|
438
|
|
Intangibles, net
|
|
162
|
|
157
|
|
Other assets
|
|
98
|
|
98
|
|
Total assets
|
|
$
3,174
|
|
$
3,027
|
|
|
|
|
|
|
|
Liabilities and Stockholders'
Equity
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Notes payable and current
maturities of long-term debt
|
|
$
189
|
|
$
239
|
|
Accounts
payable
|
|
139
|
|
121
|
|
Other
|
|
209
|
|
171
|
|
Total current
liabilities
|
|
537
|
|
531
|
|
|
|
|
|
|
|
Long-term debt
|
|
300
|
|
300
|
|
Pension and post-retirement
benefits
|
|
113
|
|
110
|
|
Deferred taxes
|
|
42
|
|
41
|
|
Other liabilities
|
|
62
|
|
69
|
|
Total
liabilities
|
|
1,054
|
|
1,051
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
Common stock
|
|
202
|
|
202
|
|
Capital in excess of par
value
|
|
202
|
|
194
|
|
Common stock in
treasury
|
|
(2,063)
|
|
(2,051)
|
|
Retained
earnings
|
|
3,634
|
|
3,536
|
|
Accumulated other
comprehensive income
|
|
145
|
|
95
|
|
Total stockholders'
equity
|
|
2,120
|
|
1,976
|
|
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
|
$
3,174
|
|
$
3,027
|
|
|
|
|
|
|
|
|
|
|
|
|
SIGMA-ALDRICH
CORPORATION
|
|
Consolidated
Statements of Cash Flows (Unaudited)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
Three
Months
|
|
|
|
Ended March
31,
|
|
|
|
2011
|
|
2010
|
|
Cash flows from operating
activities:
|
|
|
|
|
|
Net income
|
|
$
119
|
|
$
100
|
|
Adjustments to reconcile
net income to net cash provided by operating activities:
|
|
|
|
|
|
Depreciation and
amortization
|
|
26
|
|
23
|
|
Deferred income
taxes
|
|
2
|
|
3
|
|
Stock-based compensation
expense
|
|
5
|
|
4
|
|
Restructuring costs, net
of payments
|
|
2
|
|
3
|
|
Other
|
|
1
|
|
-
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
Accounts
receivable
|
|
(48)
|
|
(39)
|
|
Inventories
|
|
(12)
|
|
11
|
|
Accounts
payable
|
|
15
|
|
10
|
|
Income taxes
|
|
33
|
|
29
|
|
Other, net
|
|
8
|
|
7
|
|
Net cash provided by
operating activities
|
|
151
|
|
151
|
|
|
|
|
|
|
|
Cash flows from investing
activities:
|
|
|
|
|
|
Capital
expenditures
|
|
(18)
|
|
(18)
|
|
Net sales/(purchases) of
investments
|
|
12
|
|
(11)
|
|
Acquisitions of
businesses, net of cash acquired
|
|
(20)
|
|
(5)
|
|
Other, net
|
|
(1)
|
|
(1)
|
|
Net cash used in investing
activities
|
|
(27)
|
|
(35)
|
|
|
|
|
|
|
|
Cash flows from financing
activities:
|
|
|
|
|
|
Repayment of short-term
debt
|
|
(50)
|
|
(16)
|
|
Payment of
dividends
|
|
(21)
|
|
(20)
|
|
Treasury stock
purchases
|
|
(22)
|
|
(35)
|
|
Exercise of stock
options
|
|
14
|
|
9
|
|
Excess tax benefits from
stock-based payments
|
|
2
|
|
2
|
|
Net cash used in financing
activities
|
|
(77)
|
|
(60)
|
|
|
|
|
|
|
|
Effect of exchange rate changes
on cash
|
|
7
|
|
(8)
|
|
Net change in cash and cash
equivalents
|
|
54
|
|
48
|
|
Cash and cash equivalents at
January 1
|
|
569
|
|
373
|
|
Cash and cash equivalents at
March 31
|
|
$
623
|
|
$
421
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow(1)
|
|
$
133
|
|
$
133
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Net cash
provided by operating activities less capital
expenditures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SIGMA-ALDRICH
CORPORATION
|
|
Supplemental
Financial Information - (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales Growth by Business
Unit
|
|
|
|
|
|
Three
Months
|
|
|
|
|
Ended March
31, 2011
|
|
|
|
|
|
|
Currency
|
|
Acquisition
|
|
Adjusted
|
|
|
|
|
|
|
|
Reported
|
|
Benefit
|
|
Benefit
|
|
(Organic)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research
Essentials
|
|
7%
|
|
2%
|
|
-
|
|
5%
|
|
|
|
|
|
Research
Specialties
|
|
9%
|
|
2%
|
|
3%
|
|
4%
|
|
|
|
|
|
Research
Biotech
|
|
6%
|
|
2%
|
|
-
|
|
4%
|
|
|
|
|
|
Research
Chemicals
|
|
8%
|
|
2%
|
|
2%
|
|
4%
|
|
|
|
|
|
SAFC
|
|
18%
|
|
2%
|
|
-
|
|
16%
|
|
|
|
|
|
Total Customer
Sales
|
|
10%
|
|
2%
|
|
1%
|
|
7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business Unit
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First
Quarter 2010
|
|
Second
Quarter 2010
|
|
Third
Quarter 2010
|
|
Fourth
Quarter 2010
|
|
Total
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research
Essentials
|
|
|
|
$
112
|
|
$
107
|
|
$
105
|
|
$
110
|
|
$
434
|
|
Research
Specialties
|
|
|
|
217
|
|
207
|
|
207
|
|
214
|
|
845
|
|
Research
Biotech
|
|
|
|
91
|
|
83
|
|
84
|
|
87
|
|
345
|
|
Research
Chemicals
|
|
|
|
420
|
|
397
|
|
396
|
|
411
|
|
1,624
|
|
SAFC
|
|
|
|
152
|
|
157
|
|
167
|
|
171
|
|
647
|
|
Total Customer
Sales
|
|
|
|
$
572
|
|
$
554
|
|
$
563
|
|
$
582
|
|
$
2,271
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First
Quarter 2011
|
|
Second
Quarter 2011
|
|
Third
Quarter 2011
|
|
Fourth
Quarter 2011
|
|
Total
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research
Essentials
|
|
|
|
$
120
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
120
|
|
Research
Specialties
|
|
|
|
236
|
|
-
|
|
-
|
|
-
|
|
236
|
|
Research
Biotech
|
|
|
|
96
|
|
-
|
|
-
|
|
-
|
|
96
|
|
Research
Chemicals
|
|
|
|
452
|
|
-
|
|
-
|
|
-
|
|
452
|
|
SAFC
|
|
|
|
180
|
|
-
|
|
-
|
|
-
|
|
180
|
|
Total Customer
Sales
|
|
|
|
$
632
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
632
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SIGMA-ALDRICH
CORPORATION
|
|
Supplemental
Financial Information - (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Reported Net
Income to Adjusted Net Income
|
|
|
|
|
|
|
|
Net
Income
|
|
Diluted
Earnings
|
|
|
|
|
(in
millions)
|
|
Per
Share
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
March
31,
|
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported net
income
|
|
|
$
119
|
|
$
100
|
|
$
0.97
|
|
$
0.81
|
|
Restructuring
costs
|
|
|
2
|
|
4
|
|
0.01
|
|
0.03
|
|
Tax benefit
|
|
|
(5)
|
|
-
|
|
(0.04)
|
|
-
|
|
Adjusted net
income
|
|
|
$
116
|
|
$
104
|
|
$
0.94
|
|
$
0.84
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Statement
Ratios
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
53.2%
|
|
53.0%
|
|
|
|
|
|
S,G&A
expenses
|
|
|
23.4%
|
|
23.4%
|
|
|
|
|
|
Operating
income
|
|
|
26.4%
|
|
25.7%
|
|
|
|
|
|
Pretax income
|
|
|
26.1%
|
|
25.3%
|
|
|
|
|
|
Net income
|
|
|
18.8%
|
|
17.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective tax
rate
|
|
|
27.9%
|
|
31.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Reported
Operating Income to Adjusted Operating Income
|
|
|
|
|
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2011
|
|
% of
Sales
|
|
2010
|
|
% of
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported operating
income
|
|
|
$
167
|
|
26.4%
|
|
$
147
|
|
25.7%
|
|
Restructuring costs
|
|
|
3
|
|
0.5%
|
|
6
|
|
1.0%
|
|
Adjusted operating
income
|
|
|
$
170
|
|
26.9%
|
|
$
153
|
|
26.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Free Cash
Flow
|
|
|
|
|
|
|
|
|
|
|
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
|
$
151
|
|
$
151
|
|
|
|
|
|
Less: Capital
expenditures
|
|
|
(18)
|
|
(18)
|
|
|
|
|
|
Free cash
flow
|
|
|
$
133
|
|
$
133
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE Sigma-Aldrich