MILFORD, Mass.--(BUSINESS WIRE)--Waters Corporation (NYSE: WAT)today announced third quarter 2020 sales of $594 million, a 3% increase as reported, compared to sales of $577 million for the third quarter of 2019. Foreign currency translation benefitted sales growth by approximately 1% for the quarter.
On a GAAP basis, diluted earnings per share (EPS) for the third quarter of 2020 decreased to $2.03, compared to $2.07 for the third quarter of 2019. On a non-GAAP basis, EPS increased to $2.16, compared to $2.13 in the third quarter of 2019. A description and reconciliation of GAAP to non-GAAP results appear in the tables below and can be found on the Company’s website at http://www.waters.com under the caption “Investors.”
On a GAAP basis, net cash provided by operating activities was $173 million for the third quarter of 2020, compared to $148 million for the third quarter of 2019. On a non-GAAP basis, adjusted free cash flow for the third quarter of 2020 was $190 million versus $124 million for the third quarter of 2019.
For the first nine months of 2020, the Company’s sales were $1,579 million, a decrease of 7% as reported, compared to sales of $1,690 million for the first nine months of 2019. Foreign currency translation negatively impacted sales growth by approximately 1% for the first nine months of 2020.
On a GAAP basis, EPS for the first nine months of 2020 decreased to $4.86, compared to $5.63 for the first nine months of 2019. On a non-GAAP basis, EPS decreased to $5.41, compared to $5.85 in the first nine months of 2019. The decrease in both GAAP and non-GAAP EPS can be primarily attributed to the decline in sales volumes.
On a GAAP basis, net cash provided by operating activities was $523 million for the first nine months of 2020, compared to $451 million for the first nine months of 2019. On a non-GAAP basis, adjusted free cash flow for the first nine months of 2020 was $486 million versus $418 million for the first nine months of 2019.
“We are pleased with our solid financial results in the third quarter, which were driven by growth across geographies, while we remain cognizant of the ongoing variability we expect to face in our end markets during the fourth quarter," commented Udit Batra, President and Chief Executive Officer of Waters Corporation. “Since joining the Company, I have been working diligently to assess Waters’ overall positioning and to identify key areas in need of improvement. I believe that Waters has established a solid foundation for growth and that we must now turn our focus to improving the consistency of our commercial execution and product development efforts. We will move swiftly, but deliberately, to reinvigorate our business and address those areas in which Waters has underperformed.”
Unless otherwise noted, sales growth and decline percentages are presented on an as-reported basis and are the same as the sales growth and decline percentages presented on a constant-currency basis as compared with the same period in the prior year, each of which is detailed in the reconciliation of sales growth rates to constant-currency growth rates in the tables below.
During the third quarter of 2020, sales into the pharmaceutical market increased 5% as reported and 4% in constant currency, sales into the industrial market increased 5% as reported and 3% in constant currency and sales into the academic and governmental markets declined 8% as reported and 7% in constant currency. For the first nine months of 2020, sales into the pharmaceutical market declined 5% as reported and 4% in constant currency, sales into the industrial market declined 6% as reported and in constant currency and sales into the academic and governmental markets declined 17% as reported and 16% in constant currency.
During the third quarter, recurring revenues, which represent the combination of service and precision chemistries revenues, increased 6% as reported and 5% in constant currency, while instrument system sales declined 1% as reported and in constant currency. For the first nine months of 2020, recurring revenues were flat as reported and increased 1% in constant currency, while instrument system sales declined 15% as reported and 14% in constant currency.
Geographically, sales in Asia during the quarter declined 1% as reported and were flat in constant currency, sales in the Americas increased 2% (with U.S. sales growing 5%) and sales in Europe increased 11% as reported and 5% in constant currency. For the first nine months of 2020, sales in Asia declined 11% as reported and 10% in constant currency, sales in the Americas declined 7% (with U.S. sales declining 5%) and sales in Europe were flat as reported and in constant currency.
About Waters Corporation
Waters Corporation (NYSE: WAT), the “world's” leading specialty measurement company, has pioneered chromatography, mass spectrometry and thermal analysis innovations serving the life, materials and food sciences for more than 60 years. With more than 7,000 employees worldwide, Waters operates directly in 35 countries, including 15 manufacturing facilities, and with products available in more than 100 countries. For more information, visit www.waters.com.
