Sigma-Aldrich's 2Q Profit Up 1.8% On Higher Research and Fine Chemicals Sales
By Saabira Chaudhuri
Sigma-Aldrich Corp.'s (SIAL) second-quarter earnings edged up 1.8% as the company saw higher sales in its research and fine chemical segments.
The company cut its full-year per-share earnings forecast to between $3.80 to $3.90 from its June guidance of $3.90 to $4.05, citing negative impacts from foreign currency exchange rates.
The supplier of chemical products and kits for high-tech scientific research has continued to see its sales improve in recent quarters, with help from contributions from acquisitions. However in its first quarter, Sigma-Aldrich reported improved sales were offset by acquisition-related charges and higher overhead costs. Additionally, economic and research funding uncertainties in the U.S. and Europe have been creating a cautious climate for some customers. Meanwhile, the company has been spending to drive growth in focus areas of China, India and Brazil.
The company earlier this year completed its $350 million acquisition of BioReliance Holdings Inc., expanding Sigma-Aldrich's capabilities in biopharmaceuticals testing and services. In April, Sigma-Aldrich said it would acquire Research Organics, a supplier of high purity biochemicals.
Sigma-Aldrich reported a profit of $115 million, or 94 cents a share, up from a year-ago profit of $113 million, or 91 cents a share. Excluding one-time items, earnings were up at 97 cents from 93 cents.
Revenue increased 4.2% to $664 million. Analysts polled by Thomson Reuters most recently projected earnings of 97 cents on revenue of $674 million.
Gross margin edged down to 51.2% from 52%.
The company's research-chemicals segment, its biggest contributor to the top line, reported organic sales growth of 1% to $441 million, at the low end of the company's expectations amid a slowdown in the U.S. and Europe. However, the smaller fine chemicals segment saw organic sales growth of 8% to $223 million, a new quarterly record.
Shares of Sigma-Aldrich closed at $70.71 Monday. The stock is up 13% so far this year.