PerkinElmer Inc. Earnings Cheat Sheet: Revenue Grows After Four Straight Declines, Net Income Rises

S&P 500 (NYSE:SPY) component PerkinElmer Inc. (NYSE:PKI) reported net income above Wall Street’s expectations for the third quarter. PerkinElmer provides technology, services, and solutions to the environmental monitoring, diagnostics, academic research, and safety security markets.

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PerkinElmer Earnings Cheat Sheet for the Third Quarter

Results: Net income for PerkinElmer Inc. rose to $35.3 million (31 cents per share) vs. $13.4 million (11 cents per share) in the same quarter a year earlier. This is a more than twofold rise from the year earlier quarter.

Revenue: Rose 8.3% to $453.7 million from the year earlier quarter.

Actual vs. Wall St. Expectations: PKI reported adjusted net income of 41 cents per share. By that measure, the company beat the mean estimate of 39 cents per share. It fell short of the average revenue estimate of $469.6 million.

Quoting Management: We are pleased with our performance in the third quarter as we delivered strong growth in revenue, adjusted earnings per share and cash flow. We continued to see good progress against our multi-year goal of expanding operating margins as our strong adjusted gross margins in the period enabled us to absorb growth investments in R&D and in our commercial capabilities while providing 45 basis points of adjusted operating margin expansion,” said Robert Friel, chairman and chief executive officer of PerkinElmer. “We are also seeing significant benefits from our recent acquisitions, as we successfully integrate key technologies in imaging and sample preparation as well as our enterprise-wide informatics offerings into our broad suite of Human and Environmental Health solutions. Additionally, we look forward to completing the acquisition of Caliper Life Sciences which will further strengthen our position in the growing area of personalized medicine.”

Key Stats:

A year-over-year revenue increase last quarter snaps a streak of four consecutive quarters of revenue declines. The worst quarter in that span was the fourth quarter of the last fiscal year, which saw a 7.7% decrease.

The company has now topped analyst estimates for the last four quarters. It beat the mark by 2 cents in the second quarter, by 4 cents in the first quarter, and by 3 cents in the fourth quarter of the last fiscal year.

Gross margin shrank 0.3 percentage point to 44%. The contraction appeared to be driven by increased costs, which rose 8.9% from the year earlier quarter while revenue rose 8.3%.

Last quarter’s profit increase breaks a streak of two consecutive quarters of year-over-year profit decreases. In the second quarter, net income fell 50.5% while the figure dropped in the first quarter.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 54 cents a share to 52 cents over the last ninety days. At $1.66 per share, the average estimate for the fiscal year has fallen from $1.67 ninety days ago.

Competitors to Watch: Thermo Fisher Scientific Inc. (NYSE:TMO), Waters Corporation (NYSE:WAT), Beckman Coulter, Inc. (NYSE:BEC), Bruker Corporation (NASDAQ:BRKR), Harvard Bioscience, Inc. (NASDAQ:HBIO), Agilent Technologies Inc. (NYSE:A), Caliper Life Sciences Inc. (NASDAQ:CALP), Becton, Dickinson and Co. (NYSE:BDX), Bio-Rad Laboratories, Inc. (NYSE:BIO), and Sequenom, Inc. (NASDAQ:SQNM).

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(Source: Xignite Financials)