Agilent Reports Q4

Agilent Technologies reports fourth-quarter results

November 11, 2004

3 Min Read

PALO ALTO, Calif. -- Agilent Technologies Inc. (NYSE:A - News) today reported orders of $1.60 billion for the fourth fiscal quarter ended Oct. 31, 2004, 8 percent below one year ago. Revenues during the quarter were $1.82 billion, 9 percent ahead of last year. Fourth quarter GAAP net earnings were $74 million, or $0.15 per diluted share, compared to $13 million, or $0.03 per share, in last year's fourth quarter.

Excluding $79 million of net restructuring and amortization charges, Agilent reported fourth quarter operating net income of $153 million, or $0.30 per share. On a comparable basis, the company earned $71 million, or $0.15 per share, one year ago.

For the full year 2004, Agilent achieved orders of $7.00 billion, up 15 percent from 2003, and revenues of $7.18 billion, up 19 percent from one year ago. This year, GAAP diluted earnings per share were $0.71, compared to a loss of $4.35 last year. Operating earnings(1) were $1.05 per share this year compared to a loss of $0.26 per share in 2003.

"Agilent continued to face a difficult environment in several of its key markets," said Ned Barnholt, Agilent chairman, president and chief executive officer. "Compared to last quarter, however, our gross margins improved, operating expenses declined, working capital remained under good control and we generated $394 million in free cash flow(2) -- despite $63 million lower revenues."

Fourth quarter revenues, at $1.82 billion, were below company expectations because of weak conditions in semiconductor-related businesses. Operating earnings, at $0.30 per share, met the bottom of the company's guidance range of $0.30 to $0.35 per share.

"For 2004 overall, we are pleased with Agilent's performance despite the mixed finish," Barnholt said. "During the year, we completed the company's operational transformation that we began three years ago."

From 2001 through 2004, Agilent reduced its operating breakeven by more than 35 percent, completely transformed its IT systems environment and reduced the number of IT applications by more than 75 percent, restored its Test and Measurement segment to traditional levels of profitability, and achieved both double-digit growth and double-digit operating margins in its Life Sciences and Chemical Analysis (LSCA) segment.

"Performance on the balance sheet has been strong, with inventory days-on-hand, receivables days sales outstanding and fixed investment all near historical lows," Barnholt said. "As a result, Agilent has become consistently free-cash-flow positive(2). During the past 12 months, we increased cash by over $700 million to more than $2.3 billion."

Looking to fiscal 2005, the company said it expects the sharp adjustment in the semiconductor markets to continue to impact the performance of its Semiconductor Products and Automated Test segments for the next three to six months. Meanwhile, Test and Measurement growth is moderating because of slowing growth in mobile phone production. LSCA, on the other hand, shows few signs of slowing from its recent double-digit growth trend.

The company expects first quarter fiscal 2005 revenues of $1.60 billion to $1.70 billion and operating earnings of $0.14 to $0.21 per share (3).

Agilent Technologies Inc.

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