Sigma-Aldrich Q2 Earnings Rise, Beat Estimate; Lifts FY08 EPS Outlook

(RTTNews) - Specialty chemicals manufacturer Sigma-Aldrich Corp. (SIAL | Quote | Chart | News | PowerRating) Tuesday reported a higher second-quarter profit on a 14.4% increase in sales, helped by double-digit sales growth in all business segments and currency exchange benefits. Earnings increased 16.7% from last year and topped analysts' estimate. Sigma-Aldrich also increased its earnings outlook for fiscal 2008.

Net income for the quarter increased 13.93% to $90.8 million from $79.7 million in the same quarter last year. Earnings per share rose 16.7% to $0.70 from $0.60 in the prior-year quarter. On average, nine Street analysts surveyed by First Call/Thomson Financial expected earnings of $0.67 per share for the quarter.

Pro-forma net income for the quarter, excluding $10.6 million of currency benefit, was $80.2 million or $0.62 per share.

Net sales for the quarter advanced 14.4% to $580.70 million from $507.5 million in the last-year quarter. Analysts expected revenues of $579.27 million for the quarter.

Segment-wise, second-quarter Research Essentials division sales rose 13.49% to $109.4 million and Research Specialties sales increased 16.77% to $214.5 million from the prior-year quarter. Sales at the Research Biotech division advanced 17.55% to $86.4 million, while SAFC sales rose 10.72% to $170.4 million from the same quarter last year.

St. Louis, Missouri-based Sigma-Aldrich reported a gross profit of $294.9 million for the quarter, up from $260.5 million in the year-ago quarter.

Jai Nagarkatti, Sigma-Aldrich CEO commented, "Our second quarter sales of $580.7 million, which included the best sales month in the Company's history in June, represent another new quarterly high, exceeding the record established just one quarter ago."

Year-to-date net income increased to $175.3 million or $1.34 per share from $154.6 million or $1.16 per share in the corresponding period a year earlier. On a pro-forma basis, the company posted earnings of $151.3 million or $1.16 per share. Net sales for the six-month period advanced 14.65% to $1.15 billion.

The company raised its earnings guidance for fiscal 2008 to the range of $2.62 per share to $2.72 from the previously issued outlook ranging from $2.57 per share to $2.67 per share. Analysts currently expect the company to report earnings of $2.65 per share for 2008.

Pretax income margin for the year is estimated to improve from the 21.5% achieved in 2007. Annual sales are expected to meet the company's 7% organic growth goal.

During the quarter, Sigma-Aldrich repurchased additional 3.1 million shares at an average price of $58.51 per share, and expects to repurchase 2.0 million more shares.

SIAL ended Tuesday's trading at $58.97, up $1.02 or 1.76%, on a volume of about 1.48 million shares. The stock has been trading in a range of $43.40 to $63.04 for the past twelve months, with a three-month average volume of about 1.30 million shares.

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