Agilent Technologies Reports Fourth Quarter 2009 Results

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.