Attached files
| file | filename |
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| 8-K - FORM 8-K - SIGMA ALDRICH CORP | d8k.htm |
| EX-99.1 - PRESS RELEASE - SIGMA ALDRICH CORP | dex991.htm |
 ® Creating Differentiation Through Innovation Sigma-Aldrich Corporation Q3 2009 Earnings Review Exhibit 99.2 |
 2 ® Cautionary Statements Our presentation today will include forward looking statements relating to the
Company’s future performance, goals, strategic actions and initiatives
and similar intentions and beliefs, including expectations, goals, beliefs, intentions and the like regarding future sales, earnings, free cash flow, share repurchases and other matters. These
statements are based on assumptions regarding Company operations, investments and acquisitions and conditions in the markets the Company serves. We believe that these expectations are reasonable and well-founded. The forward-looking statements
in this release are subject to risks and uncertainties including, among
others, certain economic, political and technological factors. Actual results could differ materially from those stated or implied during this review or contained in other Company
communications due to, but not limited to, such factors as (1) declining global economic conditions, (2) changes in pricing and the competitive environment and the global demand for our products, (3) fluctuations in foreign currency exchange rates, (4) changes
in research funding and the success of research and development activities, (5)
dependence on uninterrupted manufacturing operations, (6) changes in the regulatory environment in which the Company operates, (7) changes in worldwide tax rates or tax
benefits from domestic and international operations, including the matter described in Note 4 – Uncertainty in Income Taxes – to the Consolidated Financial Statements in the Company’s Form 10-Q report for the quarter ended June 30, 2009, (8)
exposure to litigation, including product liability claims, (9) the ability to
maintain adequate quality standards, (10) reliance on third party package delivery services, (11) failure to achieve planned cost reductions in global supply chain rationalization, (12) an unanticipated
increase in interest rates, (13) failure of sales initiatives in our Research and SAFC businesses, (14) other changes in the business environment in which the Company operates, and (15) the outcome of the matters described in Note 13-Contingent
Liabilities and Commitments-in the Company’s Form 10-Q report for
the quarter ended June 30, 2009. A further discussion of risk factors can be found in Item 1A of the Company’s Form 10-K report for the year ended December 31, 2008. The Company does
not undertake any obligation to publicly update the matters covered in this
presentation. With over 60% of sales denominated in currencies other than the
U.S. dollar, management uses currency-adjusted growth, and believes
it is useful to investors, to judge the Company’s controllable, local currency performance. Organic sales growth data presented in this review is proforma data and excludes currency. While able to report historical currency impacts after the fact, we are unable to estimate changes that may occur later in 2009 to applicable rates of
exchange and thus are unable to reconcile the projected non-GAAP currency
adjusted internal growth rates to reported GAAP growth rates for 2009. Any significant changes in currency exchange rates would likely have a significant impact on our reported growth
rates due to the volume of our sales denominated in foreign currencies.
Management also reports both GAAP and adjusted sales and income comparisons to
reflect what it believes are ongoing and/or comparable operating results
excluding currency impacts. Management excludes this item in judging its historical performance and in assessing its expected future performance. Management also uses free cash
flow, a non-GAAP measure, to judge its performance and ability to pursue
opportunities that enhance shareholder value. Management believes this non-GAAP information is useful to investors as well. Reconciliations of GAAP to non-GAAP
information are included in the Company’s October 22, 2009 earnings
release posted on its website, www.sigma-aldrich.com. |
 3 ® Third Quarter 2009 Financial Results Diluted EPS Net Income Sales $534 $ 86 $0.70 Q3 2009 (in millions, except EPS) 1% 5% 9% As Reported Free Cash Flow $115 108% 2% 20% 25% Excluding Currency Impact 108% YEAR-OVER-YEAR Q3 performance reflects challenging global environment, stable research business and improved SAFC results. |
 4 ® First Nine Months 2009 Financial Results Diluted EPS Net Income Sales $1,575 $ 254 $ 2.06 Nine Months 2009 (in millions, except EPS) 7% 4% As Reported Free Cash Flow $ 274 17% 1% 15% 21% Excluding Currency Impact 17% YEAR-OVER-YEAR Performance on track to achieve 2009 guidance 1% |
 5 ® RESEARCH 72% 2009 Sales Growth (Adjusted for Currency) Total Company SAFC Research 28% SAFC Demand for research products and services continued to show growth. SAFC sales higher in Q3 Sales Mix (YTD) 1.4% 4.8% 2.3% Q3 2009/Q3 2008 1.9% (2.8%) 0.6% Nine Months 2009/ Nine Months 2008 |
 6 ® Margin Analysis PERCENTAGE OF SALES 22.7% (2.5%) (0.3%) 1.3% 0.9% 0.1% 22.4% 2009: Pre-tax Profit Margin S,G&A Expenses R & D Expense Supply Chain Initiatives Price/Volume/Mix Q3 2009 pre-tax margins impacted by currency and pricing YTD 2009 pre-tax margins improved over 2008 levels YTD 22.4% (2.1%) 1.3% 1.4% - 23.1% 2008: Pre-tax Profit Margin Impact of Currency Q3 Interest Expense 0.2% 0.2% (0.1%) |
 7 ® Free Cash Flow (in millions) 2009 $ 254 68 10 30 362 (88) $ 274 Net Income Free Cash Flow Net Cash from Operations Less Capital Expenditures Other Changes in Performance Working Capital* Depreciation & Amortization 2008 $ 257 75 (63) 31 300 (65) *Accounts Receivable + Inventory – Accounts Payable NINE MONTHS ENDED SEPTEMBER 30 Free cash flow remains strong $ 235 |
 8 ® 2009 Guidance Organic Revenue Growth Reported EPS Free Cash Flow Low single digits Above $2.70 >$325M |
 9 ® Third Quarter – Key Business Highlights • Increased e-commerce sales to 46% of worldwide research-based sales • Continued growth in CAPLA countries • SAFC booked orders for future delivery remain strong • Achieved another $5 million in supply chain process improvement benefits. • Increased application offering using zinc finger technology • Announced collaboration with Michael J. Fox Foundation • Acquired ChemNavigator |
 10 ® 2009 Guidance Organic Revenue Growth Reported EPS Free Cash Flow Low single digits Above $2.70 >$325M |
 11 ® Looking Forward Add initiatives to drive core chemistry and biochemistry businesses Increase emphasis on growth opportunities in biotech and analytical products Pursue opportunities in CAPLA countries and e-commerce Continue supply chain activities Pursue other profit margin enhancements Launching new activities in Q4 2009 – Stay tuned for outcomes |
 12 ® QUESTIONS? Sigma-Aldrich Corporation Q3 2009 Earnings Review |