LIFE Beats 4Q Rev, Misses EPS


Life Technologies Corporation (LIFE) reported earnings per share (EPS) of 63 cents in the fourth quarter of fiscal 2012 compared with 51 cents in the year-ago period. However, after taking into account certain one-time items adjusted EPS came in at $1.11, in line with the Zacks Consensus Estimate, but was 5.7% below the year-ago quarter’s adjusted EPS. The full-year adjusted EPS came in at $3.98, matching the Zacks Consensus Estimate yet again, but was down 7.3% from the year-ago result.

Revenues declined 1.1% year over year on a reported basis. However, the year-ago quarter considered the impact of a licensing settlement, charges on a discontinued product and purchase accounting related adjustments, totaling $40.1 million. After adjusting for these one-time items, revenues in the reported quarter increased 3% year over year (up 4.5% at constant exchange rates or CER) to $999 million and surpassed the Zacks Consensus Estimate of $990 million. Fiscal 2012 revenues were $3.79 billion, almost in line with the Zacks Consensus Estimate and up 2% (2.2% at CER) compared with the prior-year result.

On a regional basis, during the quarter, Europe witnessed revenue growth of 5%, Asia-Pacific witnessed revenue growth of 18% and Japan witnessed revenue growth of 6%, while the Americas recorded a flat year-over-year revenue.

At CER, year-over-year revenue growth came on the back of a substantial hike in the Ion Torrent business, with continued strong demand for the personal genome machine (PGM) and the Ion Proton systems.Moreover, in the quarter, the company successfully expanded its international footprint, with a special focus on the high growth and emerging markets.


The three divisions of Life Technologies, viz. Research Consumables, Genetic Analysis and Applied Sciences recorded revenues of $409 million (up 2% year over year; up 4% at CER), $401 million (up 2%; up 4% at CER) and $190 million (up 8%; up 10% at CER), respectively, during the quarter.

Research Consumables witnessed growth in cell culture products, benchtop instruments and sample prep products, while Genetic Analysis experienced growth in the Ion Torrent franchise including the Ion Proton System and the Ion PGM benchtop instruments, partially offset by a decline in SOLiD instrument sales and in qPCR royalty revenue. At Applied Sciences, there were strong sales of BioProduction and Forensics products.

Margin Trends

On a reported basis, adjusted gross margin, during the reported quarter, expanded 279 basis points (bps) to 63.1%. This upside was primarilydriven by manufacturing productivity, partially offset by a higher mix of instrument sales and unfavorable currency rates.

The company recorded operating expenses (reported basis) of $348.3 million, up 2.5% year over year with a 6.0% rise in selling, general and administrative expenses,partially offset by a 7.2% decline in research and development expenses. Life Technologies, during the quarter, recorded a 150 bps expansion in adjusted operating margin to 28.2%.

Balance Sheet

Life Technologies exited the fiscal with $276.4 million in the form of cash and short-term investments, lower than $882 million at the end of fiscal 2011.

Free cash flow for the quarter was $173 million ($177 million at the end of the prior quarter), while cash flow from operating activities were $221 million and capital expenditure was $48 million. The company’s debt burden declined to $2.4 billion (including senior notes of $2.3 billion plus some short-term debt) from $2.75 billion at the end of fiscal 2011.


Life Technologies provided its fiscal 2013 guidance. The company anticipates revenue growth of 3%–5% over 2012 revenues of $3.8 billion, with an expected increase in the Ion Torrent franchise sales for the third consecutive year and expansion in applied and emerging markets.The current Zacks Consensus Estimate for revenues of $3.9 billion remains below the expected range. The company also expects 2013 adjusted EPS in a range of $4.30−$4.45. The Zacks Consensus Estimate for earnings  of $4.35 per share remains within the guidance range.

A continuous share buyback program will also aid it by lowering the outstanding share count. In 2012, 13.8 million shares were repurchased for approximately $635 million.Additionally, year-to-date, the company already repurchased 2 million shares for $105 million.

Our Take

Economic uncertainties lowering discretionary spending and fluctuations in currency were the major headwinds for Life Technologies during the reported quarter.

However, over the last two years, the company has been focused on creating an optimal portfolio of products through innovation and acquisition, the latest being Ion Torrent. We are also encouraged by Life’s strategy to strengthen its presence in the high growth markets such as Latin America, the Middle East, China and India. Over the next few years, Life’s focus on developing industry-leading franchises in high-growth technology areas, applied markets and emerging geographies will be the key drivers of long-term growth. The company now carries a Zacks Rank #3 (Hold).

While we prefer to remain on the sidelines for Life Technologies, other medical device stocks worth a look are Cyberonics Inc. (CYBX), Merit Medical Systems, Inc. (MMSI) and ResMed Inc. (RMD). All these stocks carry a Zacks Rank #1 (Strong Buy).

Read the Full Research Report on LIFE

Read the Full Research Report on RMD

Read the Full Research Report on CYBX

Read the Full Research Report on MMSI

Zacks Investment Research

More From


View Comments (0)

Recommended for You

  • Tycoon buys 30 Rolls-Royces for Macau hotel

    A Hong Kong tycoon has placed the biggest ever order for Rolls-Royce cars, agreeing to buy 30 Phantoms to chauffeur guests at a luxury resort he's building in the global gambling capital of Macau. Stephen Hung's $20 million purchase surpasses the 14 Phantoms bought by Hong Kong's Peninsula Hotel in…

    Associated Press
  • Our Best-Ever Value Plan for Your Business

    New prices on our Mobile Share Value Plans on the nation's most reliable 4G LTE network.

    AdChoicesAT&T® Small BusinessSponsored
  • Tycoon's arrest sends shock wave through Russia

    Tycoon's arrest sends shock wave through Russia MOSCOW (AP) — The arrest of a Russian telecoms and oil tycoon has sent shock waves through the country's business community, with some fearing a return to the dark days of a decade ago, when the Kremlin asserted its power by imprisoning the country's…

    Associated Press
  • Before You Buy Alibaba, Check Out 4 Top China Stocks

    Before You Buy Alibaba, Check Out 4 Top China Stocks While investors gear up for Alibaba Group 's (BABA) hotly anticipated initial public offering, don't forget about other Chinese stocks that are worth keeping an eye on. Today's Young Guns Screen of

    Investor's Business Daily
  • As Fed takes baby steps, Cramer's trick for profit

    In turn, Cramer says making money in the market, involves looking at the environment through the lens of the Fed. "The trick is to remember that they speak for the common person," Cramer said. "The Fed wants the common person to make money." With that backdrop always in mind, Cramer says it becomes…

  • "The Retiree Next Door": How successful retirees stretch their savings

    "The Retiree Next Door": How successful retirees stretch their savingsBy the time she hit her late 40s, Toni Eugenia wasn’t sure she would ever be able to retire. Eugenia, 56, a pharmacy technician who lived in Houston, was nearly $200,000 in debt and

    Yahoo Finance
  • CNBC Anchor Calls Out Fed-Hater Bill Fleckenstein In Startling Shouting Match

    CNBC Bill Fleckenstein of Fleckenstein Capital appeared on CNBC's Futures Now program on Tuesday. Futures Now host Jackie DeAngelis came out swinging, asking Fleckenstein right at the top if he was willing to admit that he had misunderstood monetary policy. Sounding taken aback, Fleckenstein…

    Business Insider
  • Costco Stores in Canada to Stop Taking American Express

    “The credit card relationship between American Express and Costco Wholesale Canada will not be renewed when it expires” on Dec. 31, the company said today in an e-mail to Canadian customers. The message was attributed to Lorelle Gilpin, vice president of marketing and membership for Costco…

  • Life Insurance Doesn't Have To Be Complicated

    We'll help you understand the basics. Create your personalized estimate with USAA Life Insurance Company. Life brings obstacles, We bring advice.

  • Beanie Babies creator's sentence debated in court

    Beanie Babies creator's sentence debated in court CHICAGO (AP) — Federal prosecutors seeking to put the billionaire creator of Beanie Babies in prison for hiding millions in Swiss bank accounts told appellate court judges Wednesday that the toymaker's sentence of probation threatens to erode the…

    Associated Press
  • Play

    Citi, Bank of America Offer Discounted Mortgages

    Citigroup and Bank of America will offer mortgages at discounted interest rates to help borrowers with low incomes or subprime credit. AnnaMaria Andriotis joins MoneyBeat. Photo: Getty.

    WSJ Live
  • Apple to unveil new iPads, operating system on Oct. 21 : report

    The company plans to unveil the sixth generation of its iPad and the third edition of the iPad mini, as well as its operating system OS X Yosemite, which has undergone a complete visual overhaul, the Internet news website said. Trudy Muller, a spokeswoman for Apple, declined to comment. The iPad is…

  • Gilead Stock Is Falling On These Drug Setbacks

    Gilead Stock Is Falling On These Drug Setbacks Gilead Sciences (GILD) shares are backsliding Wednesday on news that the patient drop-out rate for hepatitis C drug Sovaldi is quadruple that of clinical trials. In addition, the biotech's Phase 2 study results

    Investor's Business Daily
  • Play

    What the Fed Meeting Means for Bonds

    Janet Yellen & Co. are expected to hint at their timetable for raising interest rates. Here's how investors should prepare ahead of the meeting.

    WSJ Live
  • Margaritaville casino owners seek bankruptcy

    The owner of Biloxi's Margaritaville casino has filed for Chapter 11 bankruptcy protection Tuesday, only hours before a hearing where the landlord aimed to seize the property. The filing by MVB Holding LLC in U.S. Don Dornan, a lawyer for landlord Clay Point LLC, said the company had planned to ask…

    Associated Press
  • Start a Family Tradition of Savings with USAA

    USAA auto insurance rates beat the competition 4 out of 5 times. When you switch to USAA you can save an average of $426 a year. Get a quote today.

  • Embraer to sell 50 E-175 jets to Republic in $2.1 billion deal

    Brazil's Embraer SA, the world's third largest commercial planemaker, said on Wednesday it booked a firm order from U.S. The deal, which will be included in Embraer's order book for the third quarter, is valued at $2.1 billion, the planemaker said in a securities filing. The planes will be operated…

  • Here's What Mark Cuban Wishes He Knew About Money In His 20s

    Cuban is the owner of the Dallas Mavericks basketball team. Billionaire investor and entrepreneur Mark Cuban is generous with his advice. When we asked him what he wishes he'd known about money in his 20s, he said:

    Business Insider
  • SHOE COMPANY: Our CEO Just Disappeared And Most Of The Money Is Gone

    "and like that: he's gone." This is an actual headline from a company press release: "CEO and COO disappeared, most of the company's cash missing." (Via FastFT) In a statement, German-based shoe company Ultrasonic said its CFO,  Chi Kwong Clifford Chan, has been unable to reach the company's CEO,…

    Business Insider
  • Billionaire Investor Says Chinese People Work Harder And Western Companies Could Face Deep Trouble After Alibaba IPO

    Michael Moritz, the chairman of VC firm Sequoia Capital, is a huge fan of Chinese internet companies and reiterated his enthusiasm for the Chinese market in an interview with The Wall Street Journal Wednesday. The billionaire investor described the Alibaba IPO as a “major landmark event” that is as…

    Business Insider
  • Top Analyst Upgrades and Downgrades: AEP, BHP, GE, Incyte, 3M, Tyco, Under Armour and More

    Top Analyst Upgrades and Downgrades: AEP, BHP, GE, Incyte, 3M, Tyco, Under Armour and More Stocks were firm on Wednesday morning ahead of the FOMC meeting outcome. Tuesday’s rally may have sparked higher interest again, and investors are looking for bargains

    24/7 Wall St.
  • 6 Things Debt Collectors Wish You Knew

    The work debt collectors do is not popular, and has become increasingly derided by those who don’t like what we do or simply don’t know the facts about debt collection. Too often, debt collection is painted with a broad brush to create a portrait that isn’t accurate, and doesn’t properly educate…
  • Proudly Serving Millions of Military Members

    USAA is dedicated to the financial well-being of military members and their families. Members receive exclusive rates for insurance, banking & more.

  • Boeing may have outfoxed Musk, but it could have bigger problems

    Elon Musk is arguably one of the greatest entrepreneurial minds of the 21st Century, but he was outsized an old school aerospace giant. Boeing won the bulk of NASA’s contract for a space taxi.  One of the other companies vying for the deal is SpaceX, the company headed by Tesla’s Musk, will get a…

    Talking Numbers