Waters Corp has reported a 15.76 percent rise in profit for the quarter ended Sep. 27, 2014. The company has earned $113.50 million, or $1.34 a share in the quarter, compared with $98.05 million, or $1.14 a share for the same period last year. On the other hand, adjusted net income for the third-quarter stood at $116.79 million, or $1.38 a share compared with $102.80 million or $1.19 a share, a year ago.
Revenue during the quarter grew 7.84 percent to $493.16 million from $457.32 million in the previous year period. Gross margin for the quarter expanded 88 basis points over the previous year period to 59 percent. Total expenses were 71.87 percent of quarterly revenues, down from 73.96 percent for the same period last year. This has led to an improvement of 209 basis points in operating margin to 28.13 percent.
Operating income for the quarter was $138.71 million, compared with $119.07 million in the previous year period. However, the adjusted operating income for the third-quarter stood at $141.63 million compared to $124.44 million in the prior year period. At the same time, adjusted operating margin was stable in the third-quarter to 28.72 percent, when compared with prior year period.
Commenting on the quarter, Douglas A. Berthiaume, Chairman, President, and Chief Executive Officer, said, "Broad-based demand from pharmaceutical customers highlighted our strong organic revenue growth in the third quarter. In addition, improvements in margins contributed to solid mid-teens EPS growth."
Working Capital
Waters Corp has recorded an increase in the working capital over the last year. It stood at $2,124.93 million as at Sep. 27, 2014, up 9.75 percent or $188.75 million from $1,936.18 million on Sep. 28, 2013. Current ratio was at 4.70 as on Sep. 27, 2014, down from 4.93 on Sep. 28, 2013.
Cash conversion cycle (CCC) has decreased to 102 days for the quarter from 164 days for the last year period. Days sales outstanding were almost stable at 73 days for the quarter, when compared with the last year period.
Days inventory outstanding has increased to 122 days for the quarter compared with 119 days for the previous year period. At the same time, days payable outstanding went up to 93 days for the quarter from 28 for the same period last year.
Debt Level
Waters Corp has witnessed an increase in total debt over the last one year. It stood at $1,430.01 million as on Sep. 27, 2014, up 10.53 percent or $136.25 million from $1,293.76 million on Sep. 28, 2013. Total debt was 38.12 percent of total assets as on Sep. 27, 2014, compared with 37.77 percent on Sep. 28, 2013.
Debt to equity ratio was at 0.78 as on Sep. 27, 2014, down from 0.80 as on Sep. 28, 2013. Interest coverage ratio improved to 19 for the quarter from 18.57 for the same period last year.
