Second-quarter 2010 IBO Life Science Index sales improved 8.3% to $2,835.24 million, including a loss of 0.2% from currency. Operating profit jumped 20.0% to $647.97 million, and operating margin climbed 230 basis points to 22.9% of sales.

Second-quarter sales for Beckman Coulter’s Life Science segment declined 2.1%, 3.2% excluding currency, to $106.5 million (see page 12) to account for 12% of revenues. Instrument sales were negatively impacted by lower capital spending in Europe and consolidation within the pharmaceutical industry. The company also reported weak stimulus and hospital research spending in the US. Life Science operating profit declined 26.4% to $14.5 million. The company lowered its full-year Life Science outlook by $30–$40 million (see IBO 7/31/10).

Fiscal third-quarter revenue for Becton Dickinson’s BD Biosciences division grew 8.4%, 11.6% excluding currency, to $309.1 million (see page 12) to make up 16% of company sales. Following a weak second quarter in 2009, domestic sales for research instruments and reagents rebounded strongly. US sales climbed 14.8% to account for 40% of segment revenue, driven by double-digit revenue growth for Advanced Bioprocessing. International sales grew 4.5%, 9.7% on a currency-neutral basis, to make up 60% of segment sales. Cell Analysis revenue improved 9.9%, 13.6% on currency-neutral basis, to $230.4 million. US Cell Analysis sales jumped 19.6% to represent 32% of segment sales, and International revenue improved 4.9%, or 10.5% at constant currency. Discovery Labware revenue increased 4.3%, 6.3% on a currency-neutral basis, to $78.7 million. Discovery Labware sales to the US rose 5.7% to make up 51% of segment revenue, while International sales improved 2.9%, 6.8% on a currency-neutral basis. Adjusted operating income grew 14.3% to $87.1 million. Full-year BD Biosciences sales are projected to grow 3%–4%, 6% at constant currency, to $1,246.1 million.

Biotage AB’s second-quarter revenues slipped 0.9%, 4% organically, to SEK 103.5 million ($13.6 million = SEK 7.59 = $1) (see page 12). Acquisitions contributed 8.2% to revenue growth, but currency reduced sales by roughly 5.5%. US and European sales declined to account for 38% and 35% of sales, respectively. Sales to Japan and Rest of the World improved to represent 16% and 11%, respectively. Operating profit jumped 27.7% to SEK 7.6 million ($1.0 million) primarily due to lower administrative expenses and favorable currency. Gross margins declined 200 basis points to 58.7% of sales due to currency transactions, product shift and lower prices.

Based on continuing operations, Caliper Life Sciences’ second-quarter sales improved 4.2%, 6% excluding currency, to $27.9 million (see page 12). The number of instruments sold jumped 19% to 44 units. Combined revenue for the LabChip and IVIS instrument product lines grew 14%, 16% organically, to account for 77% of sales. Imaging revenue gained 15.9%, 18% organically, to make up 53% of sales. Research revenue declined 4.0%, 2% organically, to make up 43% of sales. The decline was attributed to a 20.8% decline in automation sales. LabChip revenue climbed 10.8%, 12% organically, to represent 61% of Research sales. Sales were driven by the LabChip GX instruments, but were partially offset by weaker EZ Reader sales. Caliper’s Discovery Alliances and Services sales dropped 29.5% to account for 4% of revenues due to an oncology project completed in 2009 and delays for the Environmental Protection Agency’s ToxCast screening program. Adjusted operating results were just above breakeven, compared with a loss of $2.3 million a year ago. Gross profit margins soared 750 basis points to 51% of sales due to favorable product mix. Caliper ended the quarter with $37.6 million in cash, including a $16.4 million gain from the divestiture of two product lines. Full-year organic revenue is anticipated to grow 4%–6% to $114–$117 million, with a negative 1% from currency. LabChip and Imaging revenues are expected to grow 15% for the second half of the year.

Sequenom’s second-quarter revenues jumped 24.5% to $11.1 million (see page 12). MassARRAY and other product-related revenue soared 59.5% to account for 47% of sales. The company placed 11 instruments, including three of the MassARRAY Analyzer 4. Consumables revenue grew 3.2% to represent 47% of sales. Research Services revenue fell 47.7% to make up 3%. Diagnostic revenue accounted for 4% of sales due to increased demand for the fetal RhD genotyping test. Due to weak demand for the fetal XY sex-determination test, the test will be discontinued. Adjusted operating loss narrowed by 11.0% to $17.2 million due to lower legal and share-based compensation expenses. Gross margins fell nearly five percentage points to 60.9% of sales due to product shift and higher start-up costs for the Diagnostics business. During the quarter, the company recorded a $41.8 million litigation settlement expense, the majority of which will be paid for with common shares. Despite ending the quarter with $67.7 million in cash, the company stated it will have to raise additional funds in order to launch its T21 test.

Tecan’s half-year sales from continuing operations climbed 9.1%, 12.2% in local currencies, to CHF 178.0 million ($164.1 = CHF 1.09 = $1). Orders increased 7.4%, 10.7% in local currency, to CHF 193.4 million ($178.2 million). OEM sales climbed 52.4% to represent 44% of revenues, driven by demand for instruments. Services and Consumables revenue grew 4.9% to account for 32% of sales, including a 17.5% increase in consumables sales alone. Operating profit improved 11.0% to CHF 23.1 million ($21.3 million) due to higher sales volume and lower material costs. Gross profit margins slipped 90 basis points to 49.9% of sales because of product mix and exchange rates. European sales grew 28.2% in local currency to account for 49% of sales, led by OEM demand from diagnostics firms. In local currencies, sales to Asia and Others improved 0.1% and 2.2% to represent 11% and 3% of sales, respectively. North American sales were flat to represent 37%. Within Asia, Chinese sales grew in double digits, but Japanese sales declined. Liquid Handling & Robotics revenue grew 9.3%, 12.3% in local currencies, to represent 71% of sales. Segment operating income declined 2.5% to CHF 18.5 million ($17.0 million) due to product mix and higher R&D investments. Components & Detection sales improved 8.4%, 12.1% in local currencies, to make up 29% of sales, driven by higher demand for OEM components and a slight increase in sales for detection devices. Segment operating profit soared 56.0% to CHF 8.5 million ($7.9 million). Sales for the discontinued Sample Management business were CHF 10.2 million ($9.4 million), compared with CHF 19.4 million ($17.9 million) (see IBO 7/15/10). Tecan’s full-year revenues are projected to grow 6%–8% in local currency.

Bar Graph: Quarterly Sales Performance

January 2007–June 2010

Quarterly Sales

Year Q1 Q2 Q3 Q4

2007 2277 2378 2393 2662

2008 2507 2726 2645 2771

2009 2498 2617 2665 3062

2010 2806 2835

Bar Graph: Quarterly Operating Profit Margins

January 2007–June 2010

OP Margins

Year Q1 Q2 Q3 Q4

2007 17.3% 16.8% 17.7% 20.4%

2008 18.7% 18.5% 19.4% 20.8%

2009 19.4% 20.6% 21.4% 22.9%

2010 22.0% 22.9%