U.S. markets closed
  • S&P 500

    3,941.26
    -57.58 (-1.44%)
     
  • Dow 30

    33,596.34
    -350.76 (-1.03%)
     
  • Nasdaq

    11,014.89
    -225.05 (-2.00%)
     
  • Russell 2000

    1,812.58
    -27.65 (-1.50%)
     
  • Crude Oil

    74.62
    +0.37 (+0.50%)
     
  • Gold

    1,782.30
    -0.10 (-0.01%)
     
  • Silver

    22.33
    -0.01 (-0.04%)
     
  • EUR/USD

    1.0464
    -0.0005 (-0.05%)
     
  • 10-Yr Bond

    3.5130
    -0.0860 (-2.39%)
     
  • GBP/USD

    1.2130
    -0.0004 (-0.03%)
     
  • USD/JPY

    136.8890
    -0.0710 (-0.05%)
     
  • BTC-USD

    17,070.74
    +72.44 (+0.43%)
     
  • CMC Crypto 200

    400.49
    -1.32 (-0.33%)
     
  • FTSE 100

    7,521.39
    -46.15 (-0.61%)
     
  • Nikkei 225

    27,739.24
    -146.63 (-0.53%)
     

Thermo Fisher Scientific Reports Fourth Quarter and Full Year 2021 Results

Cision

WALTHAM, Mass., Feb. 2, 2022 /PRNewswire/ -- Thermo Fisher Scientific Inc. (NYSE: TMO), the world leader in serving science, today reported its financial results for the fourth quarter and full year ended December 31, 2021.

Fourth Quarter and Full Year 2021 Highlights

  • Fourth quarter revenue was $10.70 billion.

  • Fourth quarter GAAP diluted earnings per share (EPS) was $4.17.

  • Fourth quarter adjusted EPS was $6.54.


  • Full year revenue grew 22% to $39.21 billion.

  • Full year GAAP diluted EPS increased 22% to $19.46.

  • Full year adjusted EPS increased 28% to $25.13.


  • Built on industry leadership throughout the year, supporting our customers, delivering outstanding results, and investing to further strengthen the long-term growth trajectory of the company.


  • Achieved very strong results in the fourth quarter, with excellent growth in the base business and $2.45 billion of COVID-19 response revenue.



  • Accelerated investments in capacity and capabilities, investing $2.5 billion in 2021 to meet short- and long-term customer demand. During the year we added capacity for bioproduction, sterile fill-finish services, laboratory products as well as enzymes and nucleotides. We also continued to build our industry-leading scale in high-growth and emerging markets during the year, including an increase in our single-use bioproduction manufacturing in Asia Pacific and opening a Customer Innovation Center in South Korea, focused on the semiconductor industry.


  • Continued to advance our environmental, social and governance (ESG) priorities throughout the year. Building on our environmental sustainability initiatives, we committed to reach net-zero carbon emissions by 2050. Highlights from our Foundation for Science include supporting more than 100,000 students globally through our STEM education programs and supporting life-science researchers in developing countries. We also published and raised funding through our Sustainable Financing Framework supporting our commitment to doing business the right way and funding projects that align with the United Nations Sustainable Development Goals (UN SDGs). Throughout the year, Thermo Fisher Scientific was recognized as a leader in our industry and in the workplace and, in the fourth quarter, Forbes recognized the company on its list of the World's Top Female-Friendly Companies.


  • Very active year of capital deployment, investing $24 billion in strategic acquisitions. This was highlighted by the addition of PPD, Inc., a leading provider of clinical research services for the biopharma industry, and, just before year end, completing the acquisition of PeproTech, a leading provider of recombinant proteins. We also returned $2.4 billion of capital to shareholders through stock buybacks and dividends.

"We had an outstanding 2021, as we continued to execute our proven growth strategy, powered by our PPI Business System, and operated with speed at scale to help our customers and governments around the world advance their important work," said Marc N. Casper, chairman, president and chief executive officer of Thermo Fisher Scientific. "We exceeded the goals we set out to accomplish in 2021 and delivered for all of our stakeholders."

Casper added, "Thanks to our incredible team, we are entering 2022 with great momentum. Our exceptional performance has enabled us to further strengthen our long-term competitive position by significantly accelerating our growth strategy through enhanced customer relationships and significant investments in commercial capabilities, innovation, capacity expansion and acquisitions, to ensure an even brighter future."

Fourth Quarter 2021

Revenue for the quarter grew 1% to $10.70 billion in 2021, versus $10.55 billion in 2020. Organic revenue decreased 4%, acquisitions increased revenue by 6% and currency translation decreased revenue by 1%. Organic growth from the base business was 8%. COVID-19 response revenue was $2.45 billion.

GAAP Earnings Results

GAAP diluted EPS in the fourth quarter of 2021 was $4.17, versus $6.24 in the same quarter last year. GAAP operating income for the fourth quarter of 2021 was $2.54 billion, compared with $3.07 billion in the year-ago quarter. GAAP operating margin was 23.7%, compared with 29.1% in the fourth quarter of 2020.

Non-GAAP Earnings Results

Adjusted EPS in the fourth quarter of 2021 was $6.54, versus $7.09 in the fourth quarter of 2020. Adjusted operating income for the fourth quarter of 2021 was $3.16 billion, compared with $3.51 billion in the year-ago quarter. Adjusted operating margin was 29.5%, compared with 33.3% in the fourth quarter of 2020.

Full Year 2021

Revenue for the full year grew 22% to $39.21 billion in 2021, versus $32.22 billion in 2020. Organic revenue growth was 17%, acquisitions increased revenue by 3%, and currency translation increased revenue by 2%. Organic growth from the base business was 14%. COVID-19 response revenue was $9.23 billion.

GAAP Earnings Results

GAAP diluted EPS for the full year increased 22% to $19.46, versus $15.96 in 2020. GAAP operating income for 2021 grew to $10.03 billion, compared with $7.79 billion a year ago. GAAP operating margin increased to 25.6% in 2021, compared with 24.2% in 2020.

Non-GAAP Earnings Results

Adjusted EPS for the full year rose 28% to $25.13, versus $19.56 in 2020. Adjusted operating income for 2021 grew 27% compared with 2020 and adjusted operating margin increased to 31.0%, compared with 29.7% a year ago.

Annual Guidance for 2022

The company will provide updated 2022 financial guidance during its earnings conference call this morning at 8:30 a.m. Eastern time.

Use of Non-GAAP Financial Measures

Adjusted EPS, adjusted net income, adjusted operating income, adjusted operating margin, free cash flow, organic revenue growth and base business organic revenue growth are non-GAAP measures that exclude certain items detailed after the tables that accompany this press release, under the heading "Supplemental Information Regarding Non-GAAP Financial Measures." The reconciliations of GAAP to non-GAAP financial measures are provided in the tables that accompany this press release.

Conference Call

Thermo Fisher Scientific will hold its earnings conference call today, February 2, at 8:30 a.m. Eastern time. To listen, dial (844) 200-6205 within the U.S. or (929) 526-1599 outside the U.S. The access code is 986581. You may also listen to the call live on our website, www.thermofisher.com, by clicking on "Investors." You will find this press release, including the accompanying reconciliation of non-GAAP financial measures and related information, in that section of our website under "Financials." An audio archive of the call will be available under "News and Events" through Friday, February 11, 2022.

About Thermo Fisher Scientific

Thermo Fisher Scientific Inc. (NYSE: TMO) is the world leader in serving science, with annual revenue of approximately $40 billion. Our Mission is to enable our customers to make the world healthier, cleaner and safer. Whether our customers are accelerating life sciences research, solving complex analytical challenges, increasing productivity in their laboratories, improving patient health through diagnostics or the development and manufacture of life-changing therapies, we are here to support them. Our global team delivers an unrivaled combination of innovative technologies, purchasing convenience and pharmaceutical services through our industry-leading brands, including Thermo Scientific, Applied Biosystems, Invitrogen, Fisher Scientific, Unity Lab Services, Patheon and PPD. For more information, please visit www.thermofisher.com.

Safe Harbor Statement

The following constitutes a "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements that involve a number of risks and uncertainties. Important factors that could cause actual results to differ materially from those indicated by forward-looking statements include risks and uncertainties relating to: the duration and severity of the COVID-19 pandemic; the need to develop new products and adapt to significant technological change; implementation of strategies for improving growth; general economic conditions and related uncertainties; dependence on customers' capital spending policies and government funding policies; the effect of economic and political conditions and exchange rate fluctuations on international operations; use and protection of intellectual property; the effect of changes in governmental regulations; any natural disaster, public health crisis or other catastrophic event; and the effect of laws and regulations governing government contracts, as well as the possibility that expected benefits related to recent or pending acquisitions may not materialize as expected. Additional important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are set forth in our most recent annual report on Form 10-K and subsequent quarterly reports on Form 10-Q, which are on file with the SEC and available in the "Investors" section of our website under the heading "SEC Filings." While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if estimates change and, therefore, you should not rely on these forward-looking statements as representing our views as of any date subsequent to today.

Media Contact Information:

Investor Contact Information:

Ron O'Brien

Rafael Tejada

Thermo Fisher Scientific

Thermo Fisher Scientific

Phone: 781-622-1242

Phone: 781-622-1356

E-mail: ron.obrien@thermofisher.com

E-mail: rafael.tejada@thermofisher.com

Condensed Consolidated









Statement of Income (unaudited)











Three Months Ended



December
31,


% of


December
31,


% of

(In millions except per share amounts)


2021


Revenues


2020


Revenues

Revenues


$ 10,702




$ 10,550



Costs and operating expenses:









Cost of revenues (a)


5,302


49.5 %


4,867


46.1 %

Selling, general and administrative expenses (b)


1,958


18.3 %


1,793


17.0 %

Amortization of acquisition-related intangible assets


466


4.4 %


411


3.9 %

Research and development expenses


392


3.7 %


376


3.6 %

Restructuring and other costs (c)


46


0.4 %


32


0.3 %



8,164


76.3 %


7,479


70.9 %

Operating income


2,538


23.7 %


3,071


29.1 %

Interest income


11




12



Interest expense


(161)




(146)



Other expense (d)


(526)




(43)



Income before income taxes


1,862




2,894



Provision for income taxes (e)


(202)




(394)



Equity in losses of unconsolidated entities


(1)




(1)



Net income


1,659




2,499



Less: net income attributable to noncontrolling interests and redeemable noncontrolling interest


1




1



Net income attributable to Thermo Fisher Scientific Inc.


$ 1,658


15.5 %


$ 2,498


23.7 %










Earnings per share attributable to Thermo Fisher Scientific Inc.:









Basic


$ 4.20




$ 6.30



Diluted


$ 4.17




$ 6.24



Weighted average shares:









Basic


394




397



Diluted


398




400












Reconciliation of adjusted operating income and adjusted operating margin









GAAP operating income


$ 2,538


23.7 %


$ 3,071


29.1 %

Cost of revenues charges (a)



0.0 %


1


0.0 %

Selling, general and administrative charges (credits) (b)


111


1.0 %


(3)


0.0 %

Restructuring and other costs (c)


46


0.4 %


32


0.3 %

Amortization of acquisition-related intangible assets


466


4.4 %


411


3.9 %

Adjusted operating income (non-GAAP measure)


$ 3,161


29.5 %


$ 3,512


33.3 %










Reconciliation of adjusted net income









GAAP net income attributable to Thermo Fisher Scientific Inc.


$ 1,658




$ 2,498



Cost of revenues charges (a)





1



Selling, general and administrative charges (credits) (b)


111




(3)



Restructuring and other costs (c)


46




32



Amortization of acquisition-related intangible assets


466




411



Other expense adjustments (d)


532




42



Benefit from income taxes (e)


(213)




(146)



Equity in losses of unconsolidated entities


1




1



Adjusted net income (non-GAAP measure)


$ 2,601




$ 2,836












Reconciliation of adjusted earnings per share









GAAP diluted EPS attributable to Thermo Fisher Scientific Inc.


$ 4.17




$ 6.24



Cost of revenues charges (a)


0.00




0.00



Selling, general and administrative charges (credits) (b)


0.28




0.00



Restructuring and other costs (c)


0.11




0.08



Amortization of acquisition-related intangible assets


1.17




1.03



Other expense adjustments (d)


1.34




0.10



Benefit from income taxes (e)


(0.53)




(0.36)



Equity in losses of unconsolidated entities


0.00




0.00



Adjusted EPS (non-GAAP measure)


$ 6.54




$ 7.09












Reconciliation of free cash flow









GAAP net cash provided by operating activities


$ 2,688




$ 3,339



Purchases of property, plant and equipment


(831)




(586)



Proceeds from sale of property, plant and equipment


11




1



Free cash flow (non-GAAP measure)


$ 1,868




$ 2,754



Segment data


Three Months Ended



December 31,


% of


December 31,


% of

(In millions)


2021


Revenues


2020


Revenues










Revenues









Life Sciences Solutions


$ 4,150


38.8 %


$ 4,368


41.4 %

Analytical Instruments


1,725


16.1 %


1,636


15.5 %

Specialty Diagnostics


1,447


13.5 %


1,967


18.6 %

Laboratory Products and Biopharma Services


4,195


39.2 %


3,616


34.3 %

Eliminations


(815)


-7.6 %


(1,037)


-9.8 %

Consolidated revenues


$ 10,702


100.0 %


$ 10,550


100.0 %










Operating income and operating margin









Life Sciences Solutions


$ 1,999


48.2 %


$ 2,321


53.1 %

Analytical Instruments


381


22.1 %


331


20.2 %

Specialty Diagnostics


297


20.5 %


520


26.4 %

Laboratory Products and Biopharma Services


484


11.5 %


340


9.4 %

Subtotal reportable segments


3,161


29.5 %


3,512


33.3 %










Cost of revenues charges (a)



0.0 %


(1)


0.0 %

Selling, general and administrative (charges) credits (b)


(111)


-1.0 %


3


0.0 %

Restructuring and other costs (c)


(46)


-0.4 %


(32)


-0.3 %

Amortization of acquisition-related intangible assets


(466)


-4.4 %


(411)


-3.9 %

GAAP operating income


$ 2,538


23.7 %


$ 3,071


29.1 %




















(a) Reported results in 2020 include accelerated depreciation on manufacturing assets to be abandoned due to facility consolidations.

(b) Reported results in 2021 and 2020 include certain third-party expenses (credits), principally transaction/integration costs (including reimbursement thereof) related to recent/terminated acquisitions, charges/credits for changes in estimates of contingent acquisition consideration, and costs associated with product liability litigation.

(c) Reported results in 2021 and 2020 include restructuring and other costs consisting principally of severance, abandoned facility and other expenses of headcount reductions within several businesses and real estate consolidations, and charges for impairment of acquired intangible assets. Reported results in 2021 also include $22 of charges for compensation due to employees at recently acquired businesses at the date of acquisition.

(d) Reported results in 2021 and 2020 include net gains on investments. Reported results in 2021 include $570 of losses on the early extinguishment of debt and $10 of charges for the amortization of bridge loan commitment fees related to recent acquisitions. Reported results in 2020 include $42 of charges related to terminated interest rate swaps and $2 of net charges for the settlement/curtailment of pension plans.

(e) Reported provision for income taxes in 2021 and 2020 includes incremental tax benefit for the pre-tax reconciling items between GAAP and adjusted net income, incremental tax impacts from audit settlements, and incremental tax impacts from adjusting the company's non-U.S. deferred tax balances as a result of tax rate changes.

Notes:

Consolidated depreciation expense is $217 and $191 in 2021 and 2020, respectively.

For more information related to non-GAAP financial measures, refer to the section titled "Supplemental Information Regarding Non-GAAP Financial Measures" of this release.


Base business organic revenue growth






Three Months Ended




December 31,




2021






Revenue growth


1 %


Impact of COVID-19 response revenue (a) (b)


-11 %


Base business revenue growth


12 %


Impact of acquisitions


6 %


Impact of currency translation


-1 %


Base business organic revenue growth (non-GAAP measure)


8 %

*





* Results do not sum due to rounding.




(a) COVID-19 response revenue includes effects of COVID-19 response revenues from acquired businesses and foreign currency translation.


(b) Adjustment to exclude the impact of COVID-19 response revenue.










Notes:


For more information related to non-GAAP financial measures, refer to the section titled "Supplemental Information Regarding Non-GAAP Financial Measures" of this release.



Condensed Consolidated









Statement of Income (unaudited)











Year ended



December
31,


% of


December
31,


% of

(In millions except per share amounts)


2021


Revenues


2020


Revenues

Revenues


$ 39,211




$ 32,218



Costs and operating expenses:









Cost of revenues (a)


18,977


48.4 %


15,713


48.8 %

Selling, general and administrative expenses (b)


6,842


17.4 %


5,764


17.9 %

Amortization of acquisition-related intangible assets


1,761


4.5 %


1,667


5.2 %

Research and development expenses


1,406


3.6 %


1,181


3.7 %

Restructuring and other costs (c)


197


0.5 %


99


0.3 %



29,183


74.4 %


24,424


75.8 %

Operating income


10,028


25.6 %


7,794


24.2 %

Interest income


43




65



Interest expense


(536)




(553)



Other expense (d)


(694)




(76)



Income before income taxes


8,841




...