Press Release Details

Waters Corporation (NYSE: WAT) Reports Fourth Quarter and Full-Year 2023 Financial Results

February 6, 2024

Highlights

Fourth Quarter 2023

  • Sales of $819 million declined 4.5% as reported and 8% in organic constant currency, in line with guidance
  • Operational excellence drove gross margin expansion of 170 basis points and adjusted operating margin expansion of 120 basis points
  • Non-GAAP EPS of $3.62 at the high end of guidance ; GAAP EPS of $3.65

Full-Year 2023

  • Strong execution in tough market conditions delivered sales of $2,956 million, a decline of 0.5% as reported and 2% in organic constant currency, as expected
  • Wyatt acquisition delivered an on-target M&A contribution of 2.5% to sales
  • Gross margin expanded 160 basis points to 59.6% and adjusted operating margin expanded 70 basis points to 30.9%

MILFORD, Mass., Feb. 6, 2024 /PRNewswire/ -- Waters Corporation (NYSE: WAT) today announced its financial results for the fourth quarter and full-year 2023.

Sales for the fourth quarter of 2023 were $819 million, a decrease of 4.5% as reported, compared to sales of $859 million for the fourth quarter of 2022. Currency translation had minimal impact on sales, while the impact of acquisitions increased sales by more than 3%.

On a GAAP basis, diluted earnings per share (EPS) for the fourth quarter of 2023 were $3.65, compared to $3.81 for the fourth quarter of 2022. On a non-GAAP basis, EPS was $3.62, compared to $3.84 for the fourth quarter of 2022. This includes a headwind of approximately 2% due to unfavorable foreign exchange.

For fiscal year 2023, the Company's sales were $2,956 million, a decrease of 0.5% as reported, compared to sales of $2,972 million for fiscal year 2022. Currency translation decreased sales by approximately 1%, while the impact of acquisitions increased sales by 2.5%.

On a GAAP basis, EPS for fiscal year 2023 was $10.84, compared to $11.73 for fiscal year 2022. On a non-GAAP basis, EPS was $11.75, compared to $12.02 in fiscal year 2022. This includes a headwind of approximately 3% due to unfavorable foreign exchange and a 1% dilution from the Wyatt acquisition.

"Waters results in 2023 demonstrate our teams' strong focus on execution, the competitiveness of our new products, and the resilience of demand in QA/QC and high-volume applications," said Dr. Udit Batra, President & CEO, Waters Corporation. "Our focus on operational excellence helped us to deliver exceptional margin expansion even in difficult market conditions."

Dr. Batra continued, "The year ended with our business benefitting from an expected increase in sales in Q4 versus that of Q3, a testament to our teams' commitment to innovation that addresses our customers' greatest needs. We also reached a new chapter in our transformation in 2023 with the acquisition of Wyatt. We have made very good progress integrating the team, achieving our target sales contribution of 2.5% for the year."

Fourth Quarter 2023

During the fourth quarter of 2023, sales into the pharmaceutical market decreased 6% as reported and 11% in organic constant currency, sales into the industrial market decreased 3% as reported and 4% in organic constant currency, and sales into the academic and government markets decreased 2% as reported and 9% in organic constant currency.

During the quarter, instrument system sales decreased 14% as reported and 20% in organic constant currency, while recurring revenues, which represent the combination of service and precision chemistries, increased 7% as reported and 5% in organic constant currency.

Geographically, sales in Asia during the quarter decreased 18% as reported and 16% in organic constant currency (with China sales declining almost 40%). Sales in the Americas increased 4% as reported and decreased 2% in organic constant currency. Sales in Europe increased 3% as reported and decreased 6% in organic constant currency.

Full-Year 2023

For fiscal year 2023, sales into the pharmaceutical market decreased 3% as reported and 5% in organic constant currency, sales into the industrial market were flat as reported and in organic constant currency, and sales into the academic and government markets increased 13% as reported and 10% in organic constant currency.

For fiscal year 2023, instrument system sales decreased 7% as reported and 10% in organic constant currency, while recurring revenues increased 6% as reported and in organic constant currency.

Geographically, sales in Asia for fiscal year 2023 decreased 11% as reported and 7% in organic constant currency (with China sales declining more than 20%). Sales in the Americas increased 5% as reported and 1% in organic constant currency. Sales in Europe increased 7% as reported and 2% in organic constant currency.

Unless otherwise noted, sales growth and decline percentages are presented on an as-reported basis. A description and reconciliation of GAAP to non-GAAP results appear in the tables below and can be found on the Company's website www.waters.com in the Investor Relations section.

Full-Year and First Quarter 2024 Financial Guidance

Full-Year 2024 Financial Guidance

The Company expects full-year 2024 organic constant currency sales growth to be in the range of -0.5% to +1.5%. Currency translation is expected to decrease full-year sales growth by approximately 1%. M&A contribution from the Wyatt transaction covering the first four and a half months of the year is expected to increase full-year reported sales growth by 1.3%. The resulting full-year 2024 reported sales growth is expected in the range of 0% to +2%.

The Company expects full-year 2024 non-GAAP EPS to be in the range of $11.75 to $12.05, which includes an estimated headwind of approximately 1% due to unfavorable foreign exchange.

Please refer to the tables below for a reconciliation of the projected GAAP to non-GAAP financial outlook for the full-year.

First  Quarter 2024 Financial Guidance

The Company expects first quarter 2024 organic constant currency sales growth to be in the range of -11% to -9%. Currency translation is expected to decrease first quarter sales growth by approximately 1%. The Wyatt transaction is expected to increase first quarter reported sales growth by 3.5%. The resulting first quarter 2024 reported sales growth is expected in the range of -8.5% to -6.5%.

The Company expects first quarter 2024 non-GAAP EPS to be in the range of $2.05 to $2.15, which includes an estimated headwind of approximately 4% due to unfavorable foreign exchange.

Please refer to the tables below for a reconciliation of the projected GAAP to non-GAAP financial outlook for the first quarter.

Conference Call Details

Waters Corporation will webcast its fourth quarter and fiscal year 2023 financial results conference call today, February 6, 2024, at 8:00 a.m. Eastern Time. To listen to the call and see the accompanying slide presentation, please visit www.waters.com, select "Investors" under the "About Waters" section, navigate to "Events & Presentations," and click on the "Webcast." A replay will be available through February 20, 2024 on the same website by webcast and also by phone at (866) 363-1805.

About Waters Corporation

Waters Corporation (NYSE: WAT), a global leader in analytical instruments and software, has pioneered chromatography, mass spectrometry, and thermal analysis innovations serving the life, materials, food, and environmental sciences for more than 60 years. With approximately 8,000 employees worldwide, Waters operates directly in 35 countries, including 14 manufacturing facilities, and with products available in more than 100 countries. For more information, visit www.waters.com.

Non-GAAP Financial Measures

This press release contains financial measures, such as organic constant currency growth rate, adjusted operating income, adjusted net income, adjusted earnings per diluted share and adjusted free cash flow, among others, which are considered "non-GAAP" financial measures under applicable U.S. Securities and Exchange Commission rules and regulations. These non-GAAP financial measures should be considered supplemental to, and not a substitute for, financial information prepared in accordance with U.S. generally accepted accounting principles (GAAP). The Company's definitions of these non-GAAP measures may differ from similarly titled measures used by others. The non-GAAP financial measures used in this press release adjust for specified items that can be highly variable or difficult to predict. The Company generally uses these non-GAAP financial measures to facilitate management's financial and operational decision-making, including evaluation of the Company's historical operating results, comparison to competitors' operating results and determination of management incentive compensation. These non-GAAP financial measures reflect an additional way of viewing aspects of the Company's operations that, when viewed with GAAP results and the reconciliations to corresponding GAAP financial measures, may provide a more complete understanding of factors and trends affecting the Company's business. Because non-GAAP financial measures exclude the effect of items that will increase or decrease the Company's reported results of operations, management strongly encourages investors to review the Company's consolidated financial statements and publicly filed reports in their entirety. Reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the tables accompanying this release.

Cautionary Statement

This release contains "forward-looking" statements regarding future results and events. For this purpose, any statements that are not statements of historical fact may be deemed forward-looking statements. Without limiting the foregoing, the words "feels", "believes", "anticipates", "plans", "expects", "intends", "suggests", "appears", "estimates", "projects" and similar expressions, whether in the negative or affirmative, are intended to identify forward-looking statements. The Company's actual future results may differ significantly from the results discussed in the forward-looking statements within this release for a variety of reasons, including and without limitation, risks related to, and expectations or ability to realize commercial success of the Wyatt transaction; the impact of this transaction on the Company's business, anticipated progress on Waters' research programs, development of new analytical instruments and associated software or consumables, manufacturing development and capabilities; the increased indebtedness of the Company as a result of the Wyatt transaction, the repayment of which could impact the Company's future results, market prospects for its products and sales and earnings guidance; foreign currency exchange rate fluctuations potentially affecting translation of the Company's future non-U.S. operating results, particularly when a foreign currency weakens against the U.S. dollar; current global economic, sovereign and political conditions and uncertainties, including the effect of new or proposed tariff or trade regulations; changes in inflation and interest rates; the impacts and costs of war, in particular as a result of the ongoing conflict between Russia and Ukraine and in the Middle East, and the possibility of further escalation resulting in new geopolitical and regulatory instability; the Chinese government's ongoing tightening of restrictions on procurement by government-funded customers; the Company's ability to access capital, maintain liquidity and service the Company's debt in volatile market conditions; changes in timing and demand for the Company's products among the Company's customers and various market sectors, particularly as a result of fluctuations in their expenditures or ability to obtain funding; the ability to realize the expected benefits related to the Company's various cost-saving initiatives; the introduction of competing products by other companies and loss of market share, as well as pressures on prices from competitors and/or customers; changes in the competitive landscape as a result of changes in ownership, mergers and continued consolidation among the Company's competitors; regulatory, economic and competitive obstacles to new product introductions; lack of acceptance of new products and inability to grow organically through innovation; rapidly changing technology and product obsolescence; risks associated with previous or future acquisitions, strategic investments, joint ventures and divestitures, including risks associated with contingent purchase price payments and expansion of our business into new or developing markets; risks associated with unexpected disruptions in operations; failure to adequately protect the Company's intellectual property, infringement of intellectual property rights of third parties and inability to obtain licenses on commercially reasonable terms; the Company's ability to acquire adequate sources of supply and its reliance on outside contractors for certain components and modules, as well as disruptions to its supply chain; risks associated with third-party sales intermediaries and resellers; the impact and costs of changes in statutory or contractual tax rates in jurisdictions in which the Company operates as well as shifts in taxable income among jurisdictions with different effective tax rates, the outcome of ongoing and future tax examinations and changes in legislation affecting the Company's effective tax rate; the Company's ability to attract and retain qualified employees and management personnel; risks associated with cybersecurity and technology, including attempts by third parties to defeat the security measures of the Company and its third-party partners; increased regulatory burdens as the Company's business evolves, especially with respect to the U.S. Food and Drug Administration and U.S. Environmental Protection Agency, among others, and in connection with government contracts; regulatory, environmental, and logistical obstacles affecting the distribution of the Company's products, completion of purchase order documentation and the ability of customers to obtain letters of credit or other financing alternatives; risks associated with litigation and other legal and regulatory proceedings; and the impact and costs incurred from changes in accounting principles and practices. Such factors and others are discussed more fully in the sections entitled "Forward-Looking Statements" and "Risk Factors" of the Company's annual report on Form 10-K for the year ended December 31, 2022, as well as in the sections entitled "Special Note Regarding Forward-Looking Statements" and "Risk Factors" of the Company's quarterly reports on Form 10-Q for the quarterly periods ended April 1, 2023, July 1, 2023, and September 30, 2023 as filed with the Securities and Exchange Commission ("SEC"), which discussions are incorporated by reference in this release, as updated by the Company's future filings with the SEC. The forward-looking statements included in this release represent the Company's estimates or views as of the date of this release and should not be relied upon as representing the Company's estimates or views as of any date subsequent to the date of this release. Except as required by law, the Company does not assume any obligation to update any forward-looking statements.

 

Waters Corporation and Subsidiaries

Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)








Three Months Ended


Twelve Months Ended


December 31,
2023


December 31,
2022


December 31,
2023


December 31,
2022









Net sales

$             819,474


$             858,510


$          2,956,416


$          2,971,956









Costs and operating expenses:








Cost of sales

318,360


348,190


1,195,223


1,248,182

Selling and administrative expenses 

180,357


174,257


736,014


658,026

Research and development expenses 

44,386


48,277


174,945


176,190

Purchased intangibles amortization 

12,148


1,503


32,558


6,366

Acquired in-process research and development

-


-


-


9,797









Operating income 

264,223


286,283


817,676


873,395









Other (expense) income, net

(557)


(372)


807


2,228

Interest expense, net

(26,066)


(10,415)


(82,240)


(37,777)









Income from operations before income taxes

237,600


275,496


736,243


837,846









Provision for income taxes

21,395


48,434


94,009


130,091









Net income

$             216,205


$             227,062


$             642,234


$             707,755

















Net income per basic common share

$                   3.66


$                   3.83


$                 10.87


$                 11.80









Weighted-average number of basic common shares

59,142


59,329


59,076


59,985

















Net income per diluted common share

$                   3.65


$                   3.81


$                 10.84


$                 11.73









Weighted-average number of diluted common shares and equivalents

59,311


59,644


59,270


60,331

 

Waters Corporation and Subsidiaries

Reconciliation of GAAP to Adjusted Non-GAAP

Net Sales by Operating Segments, Products & Services, Geography and Markets

Three Months Ended December 31, 2023 and December 31, 2022

(In thousands)
















Organic 















Constant



Three Months Ended


Percent


Impact of


Impact of


Currency



December 31, 2023


December 31, 2022


Change


Currency


Acquisitions


Growth Rate (a)
















NET SALES - OPERATING SEGMENTS




























Waters


$

716,932


$

754,753


(5 %)


0 %


4 %


(9 %)

TA



102,542



103,757


(1 %)


1 %


0 %


(2 %)
















Total


$

819,474


$

858,510


(5 %)


0 %


3 %


(8 %)































NET SALES - PRODUCTS & SERVICES






























Instruments


$

397,201


$

463,038


(14 %)


1 %


5 %


(20 %)
















Service



278,888



255,734


9 %


1 %


2 %


6 %

Chemistry



143,385



139,738


3 %


0 %


0 %


3 %

Total Recurring



422,273



395,472


7 %


0 %


2 %


5 %
















Total


$

819,474


$

858,510


(5 %)


0 %


3 %


(8 %)































NET SALES - GEOGRAPHY






























Asia


$

261,893


$

319,465


(18 %)


(3 %)


1 %


(16 %)

Americas



303,746



293,118


4 %


0 %


6 %


(2 %)

Europe



253,835



245,927


3 %


6 %


4 %


(6 %)
















Total


$

819,474


$

858,510


(5 %)


0 %


3 %


(8 %)































NET SALES - MARKETS






























Pharmaceutical


$

463,698


$

492,763


(6 %)


1 %


4 %


(11 %)

Industrial



260,249



267,923


(3 %)


(0 %)


1 %


(4 %)

Academic & Government



95,527



97,824


(2 %)


1 %


7 %


(9 %)
















Total


$

819,474


$

858,510


(5 %)


0 %


3 %


(8 %)









(a)

The Company believes that referring to comparable organic constant currency growth rates is a useful way to evaluate the underlying performance of Waters Corporation's net sales. Organic constant currency growth, a non-GAAP financial measure, measures the change in net sales between current and prior year periods, excluding the impact of foreign currency exchange rates during the current period and excluding the impact of acquisitions made within twelve months of the acquisition close date. See description of non-GAAP financial measures contained in this release.

 

Waters Corporation and Subsidiaries

Reconciliation of GAAP to Adjusted Non-GAAP

Net Sales by Operating Segments, Products & Services, Geography and Markets

Twelve Months Ended December 31, 2023 and December 31, 2022

(In thousands)
















Organic 















Constant



Twelve Months Ended


Percent


Impact of


Impact of


Currency



December 31, 2023


December 31, 2022


Change


Currency


Acquisitions


Growth Rate (a)
















NET SALES - OPERATING SEGMENTS




























Waters


$

2,601,590


$

2,626,462


(1 %)


(1 %)


3 %


(3 %)

TA



354,826



345,494


3 %


(0 %)


0 %


3 %
















Total


$

2,956,416


$

2,971,956


(1 %)


(1 %)


3 %


(2 %)































NET SALES - PRODUCTS & SERVICES






























Instruments


$

1,361,581


$

1,462,770


(7 %)


(1 %)


4 %


(10 %)
















Service



1,053,366



983,787


7 %


(1 %)


2 %


7 %

Chemistry



541,469



525,399


3 %


(1 %)


0 %


4 %

Total Recurring



1,594,835



1,509,186


6 %


(1 %)


1 %


6 %
















Total


$

2,956,416


$

2,971,956


(1 %)


(1 %)


3 %


(2 %)































NET SALES - GEOGRAPHY






























Asia


$

1,007,825


$

1,131,743


(11 %)


(4 %)


0 %


(7 %)

Americas



1,108,573



1,055,635


5 %


(0 %)


4 %


1 %

Europe



840,018



784,578


7 %


3 %


3 %


2 %
















Total


$

2,956,416


$

2,971,956


(1 %)


(1 %)


3 %


(2 %)































NET SALES - MARKETS






























Pharmaceutical


$

1,696,875


$

1,751,665


(3 %)


(1 %)


3 %


(5 %)

Industrial



909,003



909,805


0 %


(1 %)


1 %


0 %

Academic & Government



350,538



310,486


13 %


(1 %)


4 %


10 %
















Total


$

2,956,416


$

2,971,956


(1 %)


(1 %)


3 %


(2 %)









(a)

The Company believes that referring to comparable organic constant currency growth rates is a useful way to evaluate the underlying performance of Waters Corporation's net sales. Organic constant currency growth, a non-GAAP financial measure, measures the change in net sales between current and prior year periods, excluding the impact of foreign currency exchange rates during the current period and excluding the impact of acquisitions made within twelve months of the acquisition close date. See description of non-GAAP financial measures contained in this release.

 

Waters Corporation and Subsidiaries

Reconciliation of GAAP to Adjusted Non-GAAP Financials

Three and Twelve Months Ended December 31, 2023 and December 31, 2022

(In thousands, except per share data)





































Acquired












Income from

















IPR&D and












Operations














Selling &



Research &






Operating



Other



before



Provision for






Diluted





Administrative



Development



Operating



Income



(Expense)



Income



Income



Net



Earnings





Expenses (a)



Expenses



Income



Percentage



Income



Taxes



Taxes



Income



per Share

Three Months Ended December 31, 2023




























GAAP


$

192,505


$

44,386


$

264,223



32.2 %


$

(557)


$

237,600


$

21,395


$

216,205


$

3.65

Adjustments:





























Purchased intangibles amortization (b)



(12,148)



-



12,148



1.5 %



-



12,148



2,906



9,242



0.16


Restructuring costs and certain other items (d)



(1,036)



-



1,036



0.1 %



130



1,166



266



900



0.02


Acquisition related costs (e)



(649)



-



649



0.1 %



-



649



156



493



0.01


Retention bonus obligation (g)



(5,725)



(1,909)



7,634



0.9 %



-



7,634



1,832



5,802



0.10


Certain income tax items (f)



-



-



-



-



-



-



17,651



(17,651)



(0.30)

Adjusted Non-GAAP


$

172,947


$

42,477


$

285,690



34.9 %


$

(427)


$

259,197


$

44,206


$

214,991


$

3.62






























Three Months Ended December 31, 2022




























GAAP


$

175,760


$

48,277


$

286,283



33.3 %


$

(372)


$

275,496


$

48,434


$

227,062


$

3.81

Adjustments:





























Purchased intangibles amortization (b)



(1,503)



-



1,503



0.2 %



-



1,503



346



1,157



0.02


Restructuring costs and certain other items (d)



(1,364)



-



1,364



0.2 %



(120)



1,244



278



966



0.02

Adjusted Non-GAAP


$

172,893


$

48,277


$

289,150



33.7 %


$

(492)


$

278,243


$

49,058


$

229,185


$

3.84






























Twelve Months Ended December 31, 2023




























GAAP


$

768,572


$

174,945


$

817,676



27.7 %


$

807


$

736,243


$

94,009


$

642,234


$

10.84

Adjustments:





























Purchased intangibles amortization (b)



(32,558)



-



32,558



1.1 %



-



32,558



7,758



24,800



0.42


Restructuring costs and certain other items (d)



(29,917)



-



29,917



1.0 %



(521)



29,396



7,126



22,270



0.38


Acquisition related costs (e)



(13,947)



-



13,947



0.5 %



-



13,947



3,347



10,600



0.18


Retention bonus obligation (g)



(14,093)



(4,699)



18,792



0.6 %



-



18,792



4,510



14,282



0.24


Certain income tax items (f)



-



-



-



-



-



-



17,651



(17,651)



(0.30)

Adjusted Non-GAAP


$

678,057


$

170,246


$

912,890



30.9 %


$

286


$

830,936


$

134,401


$

696,535


$

11.75






























Twelve Months Ended December 31, 2022




























GAAP


$

664,392


$

185,987


$

873,395



29.4 %


$

2,228


$

837,846


$

130,091


$

707,755


$

11.73

Adjustments:





























Purchased intangibles amortization (b)



(6,366)



-



6,366



0.2 %



-



6,366



1,461



4,905



0.08


Acquired in-process research and development (c)



-



(9,797)



9,797



0.3 %



-



9,797



2,351



7,446



0.12


Restructuring costs and certain other items (d)



(8,551)



-



8,551



0.3 %



(3,273)



5,278



1,186



4,092



0.07


Certain income tax items (f)



-



-



-



-



-



-



(994)



994



0.02

Adjusted Non-GAAP


$

649,475


$

176,190


$

898,109



30.2 %


$

(1,045)


$

859,287


$

134,095


$

725,192


$

12.02









(a)

Selling & administrative expenses include purchased intangibles amortization.

(b)

The purchased intangibles amortization, a non-cash expense, was excluded to be consistent with how management evaluates the performance of its core business against historical operating results and the operating results of competitors over periods of time.

(c)

Acquired in-process research and development was excluded as it relates to the cost of a licensing arrangement for charge detection mass spectrometry that the Company believes is unusual and not indicative of its normal business operations.

(d)

Restructuring costs and certain other items were excluded as the Company believes that the cost to consolidate operations, reduce overhead, and certain other income or expense items are not normal and do not represent future ongoing business expenses of a specific function or geographic location of the Company. 

(e)

Acquisition related costs include all incremental expenses incurred, such as advisory, legal, accounting, tax, valuation, and other professional fees. The Company believes that these costs are not normal and do not represent future ongoing business expenses.

(f)

Certain income tax items were excluded as these non-cash expenses and benefits represent updates in management's assessment of ongoing examinations, tax audit settlements, or other tax items that are not indicative of the Company's normal or future income tax expense.

(g)

In connection with the Wyatt acquisition, the Company started to recognize a two-year retention bonus obligation that is contingent upon the employee's providing future service and continued employment with Waters. The Company believes that these costs are not normal and do not represent future ongoing business expenses.

 

Waters Corporation and Subsidiaries

Preliminary Condensed Unclassified Consolidated Balance Sheets

(In thousands and unaudited)








December 31, 2023


December 31, 2022






Cash, cash equivalents and investments


$              395,974


$              481,391

Accounts receivable


702,168


722,892

Inventories


516,236


455,710

Property, plant and equipment, net


639,073


582,217

Intangible assets, net


629,187


227,399

Goodwill


1,305,446


430,328

Other assets


438,770


381,516

   Total assets


$           4,626,854


$           3,281,453











Notes payable and debt


$           2,355,513


$           1,574,878

Other liabilities


1,121,000


1,202,087

   Total liabilities


3,476,513


2,776,965






Total stockholders' equity


1,150,341


504,488

   Total liabilities and stockholders' equity


$           4,626,854


$           3,281,453

 

Waters Corporation and Subsidiaries

Preliminary Condensed Consolidated Statements of Cash Flows

Three and Twelve Months Ended December 31, 2023 and December 31, 2022

(In thousands and unaudited)















Three Months Ended


Twelve Months Ended




December 31, 2023


December 31, 2022



December 31, 2023


December 31, 2022








Cash flows from operating activities:










Net income

$                    216,205


$                 227,062



$                 642,234


$                 707,755


Adjustments to reconcile net income to net cash provided by operating activities:











Stock-based compensation

4,644


11,635



36,868


42,564



Depreciation and amortization

48,060


31,318



165,905


130,423



Change in operating assets and liabilities and other, net

(38,787)


(71,306)



(242,198)


(269,081)




Net cash provided by operating activities

230,122


198,709



602,809


611,661












Cash flows from investing activities:










Additions to property, plant, equipment and software capitalization

(41,588)


(62,184)



(160,632)


(175,921)


Business acquisitions, net of cash acquired

3,553


-



(1,282,354)


-


Proceeds from equity investments, net

91


-



742


8,903


Payments for intellectual property licenses

-


-



-


(7,535)


Net change in investments

-


-



(21)


66,586




Net cash used in investing activities

(37,944)


(62,184)



(1,442,265)


(107,967)












Cash flows from financing activities:










Net change in debt

(150,001)


30,000



779,600


60,000


Proceeds from stock plans

11,700


6,665



29,792


42,801


Purchases of treasury shares

156


(148,894)



(70,277)


(626,061)


Other cash flow from financing activities, net

7,658


783



15,836


13,627




Net cash (used in) provided by financing activities

(130,487)


(111,446)



754,951


(509,633)













Effect of exchange rate changes on cash and cash equivalents

(3,029)


11,813



(948)


(14,766)




Increase (decrease) in cash and cash equivalents

58,662


36,892



(85,453)


(20,705)












Cash and cash equivalents at beginning of period

336,414


443,637



480,529


501,234




Cash and cash equivalents at end of period

$                    395,076


$                 480,529



$                 395,076


$                 480,529























Reconciliation of GAAP Cash Flows from Operating Activities to Free Cash Flow (a)












Net cash provided by operating activities - GAAP

$                    230,122


$                 198,709



$                 602,809


$                 611,661













Adjustments:











Additions to property, plant, equipment and software capitalization

(41,588)


(62,184)



(160,632)


(175,921)



Tax reform payments

-


-



72,101


38,454



Litigation settlements paid, net

(375)


-



(1,500)


(584)



Major facility renovations

3,494


8,113



15,645


32,079



Payment of acquired Wyatt liabilities (b)

-


-



25,617


-

Free Cash Flow - Adjusted Non-GAAP

$                    191,653


$                 144,638



$                 554,040


$                 505,689









(a)

The Company defines free cash flow as net cash flow from operations accounted for under GAAP less capital expenditures and software capitalizations plus or minus any unusual and non recurring items. Free cash flow is not a GAAP measurement and may not be comparable to free cash flow reported by other companies.

(b)

In connection with the Wyatt acquisition, the Company assumed certain obligations of Wyatt and paid those obligations immediately upon closing the transaction. The Company believes that the assumed obligations do not represent future ongoing business expenses.

 

Waters Corporation and Subsidiaries

Reconciliation of Projected GAAP to Adjusted Non-GAAP Financial Outlook













Three Months Ended


Twelve Months Ended




March 30, 2024


December 31, 2024





Range




Range



Projected Sales



















Organic constant currency sales growth rate (a)

(11.0 %)

-

(9.0 %)


(0.5 %)

-

1.5 %


Impact of:










Currency translation

(1.0 %)

-

(1.0 %)


(0.8 %)

-

(0.8 %)



Acquisitions

3.5 %

-

3.5 %


1.3 %

-

1.3 %


Sales growth rate as reported

(8.5 %)

-

(6.5 %)


0.0 %

-

2.0 %















Range




Range



Projected Earnings Per Diluted Share



















GAAP earnings per diluted share

$      1.77

-

$      1.87


$    10.80

-

$    11.10


Adjustments:










Purchased intangibles amortization 

$      0.18

-

$      0.18


$      0.70

-

$      0.70



Retention bonus obligation

$      0.10

-

$      0.10


$      0.25

-

$      0.25


Adjusted non-GAAP earnings per diluted share

$      2.05

-

$      2.15


$    11.75

-

$    12.05










(a)

Organic constant currency growth rates are a non-GAAP financial measure that measures the change in net sales between current and prior year periods, excluding the impact of foreign currency exchange rates during the current period and excluding the impact of acquisitions made within twelve months of the acquisition close date. These amounts are estimated at the current foreign currency exchange rates and based on the forecasted geographical sales in local currency, as well as an assessment of market conditions as of today, and may differ significantly from actual results.


These forward-looking adjustment estimates do not reflect future gains and charges that are inherently difficult to predict and estimate due to their unknown timing, effect and/or significance.

 

Contact:    Caspar Tudor, Head of Investor Relations – (508) 482-2429

Cision View original content:https://www.prnewswire.com/news-releases/waters-corporation-nyse-wat-reports-fourth-quarter-and-full-year-2023-financial-results-302053821.html

SOURCE Waters Corporation

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