First-quarter revenues for the IBO Lab Equipment/Consumables Index declined 9.9% to $803.18 million and operating profits fell 9.8% to $245.35 million, while operating margin was unchanged at 30.5% of sales. Unfavorable currency transactions for US companies and reduced R&D spending by customers resulted in lower revenue growth.

Biohit Oyj’s first-quarter sales grew 2.0% to €8.3 million ($10.8 million = €0.77 = $1), while operating income climbed marginally into the black. Sales improved across all geographic segments except for North America, which was negatively impacted by slower R&D spending. Liquid Handling sales improved 2% to €7.9 million ($10.3 million) to account for 95% of sales due to increased demand for disposable tips and new pipette maintenance and calibration software. Segment profit climbed 5% to €0.6 million ($0.8 million). Diagnostics sales grew 4% to €0.4 million ($0.5 million), including sales of test kits and instruments of €0.3 million ($0.4 million) and €0.1 million ($0.1 million), respectively. Diagnostics operating loss narrowed by 3% to €0.6 million ($0.8 million). For 2009, the company anticipates modest growth in both Liquid Handling and Diagnostics product sales, with increased demand from Asian and European markets.

For the fiscal second quarter ended May 31, revenue for Gerresheimer’s Life Science Research segment declined 3.5%, 15.6% on a currency-neutral basis, to €21.8 million ($29.1 million = €0.75 = $1) to account for 8% of company sales. Lower demand for labware glass and inventory buildup negatively impacted segment revenue. Operating profit fell 33.3% to €1.8 million ($2.4 million) due to lower revenue growth.

Kewaunee Scientific’s fiscal fourth-quarter sales ended April 30 rose 12.3% to $24.8 million, and operating profit soared 110.9% to $1.7 million. Fiscal year-end revenues grew 16.2% to $104.0 million due to strong US demand for laboratory furniture. Backlog orders grew 3.3% to $62.7 million. Domestic sales rose 22.0% to represent 87% of total sales, while international sales fell 13.0% to make up 13% of sales due to weaker demand from Asia. Full-year operating profit improved 26.2% to $7.1 million, despite higher costs of goods sold and energy expenses during the first half of the year. For 2010, the company anticipates improved sales for laboratory furniture in both the US and Asia. The company’s new manufacturing facility in Bangalore, India, is expected to enhance its competitive position for new projects in Asia and the Middle East.

First-quarter revenues for Millipore’s Bioscience division slipped 1.0% to $177.9 million to account for 43.6% of Millipore’s total sales. Currency transaction reduced revenue growth by 7%, while the acquisition of Guava Technologies (see IBO 2/15/09) contributed 1% to revenue growth. The company also benefited from four additional selling days in the quarter. Organic revenue growth was driven by higher sales of laboratory water consumables and services, as well as life science products and services due to higher demand from the protein research and cell biology markets. Demand for biomarker validation services, immunoassay kits and stem cell products also contributed to revenue growth.

Despite Millipore’s higher sales, the Lab Water business experienced a slowdown in growth, particularly for instruments, due to delays or cancellations of laboratory renovation projects. In addition, sales in the Drug Discovery and pharmaceutical-related businesses slowed on account of reduced R&D spending by customers. Sales to Europe grew in the double digits due to strong life science revenue, while sales to North America declined modestly. Despite positive growth in China, overall sales to Asia were significantly lower as demand from Japan and India was negatively impacted by the economic downturn. Total company revenues are anticipated to grow 3%–5% in 2009, including acquisitions, but excluding a 4% decline from currency transactions.

Fiscal third-quarter sales ended April 30 for Pall’s BioPharmaceuticals segment declined 8.3% to $138.3 million to account for 25% of total sales, but grew 3.2% on a currency-neutral basis. Sales to the pharmaceutical market improved 5.9%, led by a 6% growth in consumables sales, while sales to the laboratory market declined 12.2%. Sales to Europe and Asia improved 5.5% and 24.6%, respectively, while sales to the Western Hemisphere declined 9.9%.

First-quarter sales for Thermo Fisher Scientific’s Laboratory Products and Services fell 9.3% to $1,423.0 million to account for 63% of the company’s total revenues. Currency translations reduced revenue growth by 4.8%. Organic revenues declined 5.3% due to lower demand for laboratory equipment and a revised purchase agreement with a health care supplier. However, the decrease in sales was partially offset by higher prices. The biopharmaceutical services and research catalog businesses showed modest growth, but lab equipment sales declined. Adjusted operating income declined 19.8% to $175.5 million, and adjusted operating margin slipped 160 basis points to 12.3% of sales.

VWR’s first-quarter revenues fell 8.8% to $841.2 million, including a decline of 7.4% from currency transactions. Acquisitions contributed 1.3% to revenue growth. Organic sales declined 2.7%. Equipment and instrument sale declined 10%–12%. Among end-markets, industrial sales showed the largest decline and were down in double digits. Consumables sales, which accounted for 75% of total revenues, slipped 1%–2%. However, chemical and pharmaceutical and biotechnology sales were slightly positive. Chemical revenues benefited from higher prices.

Sales for VWR’s North American Lab segment declined 6.5%, 3.9% on a currency-neutral basis, to account for 58% of sales. European Lab sales dropped 12.9%, including a decline of 14.7% growth from foreign-currency transactions and 3.2% growth from acquisitions to make up 39% of total revenues. Science Education revenue grew 1.5% to account for 3% of total sales due to increased demand from international customers, which was partially offset by lower sales in the science supplies businesses. Adjusted operating income for the North American Lab and European Lab segments grew 0.4% and 6.0% to $25.4 and $19.3 million, respectively, while the Science Education segment’s loss narrowed 23.3% to $2.3 million. Total adjusted operating profits improved 4.7% to $42.4 million, while gross profit margins improved 80 basis points to 29.1% of sales due to increased pricing. The company also announced a salary freeze and modest reduction in head count.

Chart: Quarterly Operating Profit Margins January 2006–March 2009

Q1 Q2 Q3 Q4

2006 25.9% 25.7% 26.4% 27.4%

2007 29.2% 28.5% 29.3% 28.6%

2008 30.5% 29.8% 30.7% 30.6%

2009 30.5%

Chart: Quarterly Sales Performance January 2006–March 09

Q1 Q2 Q3 Q4

2006 711.8 731.3 728.5 787.8

2007 802.5 808.5 821.8 877.0

2008 891.9 909.8 895.5 866.2

2009 803.2