Calendar year second quarter sales for publicly held analytical and life science instrument and lab products companies were strong overall. Businesses that reported a double-digit increase in organic revenues included Bio-Rad Life Science, Bio-Techne, Illumina and PerkinElmer Discovery & Analytical Solutions (DAS). Sales for companies performed as expected with a slight uptick in fiscal full year expectations, as Agilent Technologies, Bruker, Ilumina, PerkinElmer and Thermo Fisher Scientific each raised revenue guidance.
Combined calendar year second quarter sales for companies in the IBO Life Science and Analytical Instrument Sales Indexes increased 8% excluding acquisitions and currency effects. The growth rate accelerated from the same period a year ago, as both industrial and life science end-markets exhibited healthy demand. Driving results were Bio-Rad Laboratories Life Sciences, BioTechne Protein Platforms and Illumina, which reported organic sales growth of 18.9%, 19% and 25.4%, respectively.
Although some companies, such as Agilent, Bruker, PerkinElmer and Thermo Fisher, commented on their quarterly conference call on the impact of Chinese-US tariffs, no company reported related changes in customer purchase behavior and detailed only minor operating effects. Changes these companies have started or planned in reaction to the tariffs include relocation of manufacturing outside of China, revised supply chains and possible price increases.
Pharmaceutical and chemical markets led growth for companies in the IBO Sales Indexes. PerkinElmer and Thermo Fisher both reported double-digit growth for the pharmaceutical market for total company sales. Waters and Shimadzu AMI reported a bounce back in Indian pharmaceutical sales from the first quarter.
Industrial market sales growth was also healthy, led by chemical and associated end-markets. Highlights included double-digit growth for Agilent Technologies’ chemical and energy sales, fine chemicals for Spectris Materials Analysis and Waters’ TA segment, as well as high single digits for PerkinElmer DAS’s industrial sales. Bruker Scientific Instruments (BSI) and Shimadzu Analytical & Measuring Instruments (AMI) reported strong sales for materials analysis applications.
Academic and government sales also increased. Waters, in particular, reported strong growth in this market, while Thermo Fisher Scientific’s academic and government sales were up high single digits. However, for other companies, such as Agilent Technologies and QIAGEN, growth was more subdued.
Sales to the applied markets for IBO Sales Index companies were mixed. Agilent and Shimadzu AMI noted slower sales in China due to the reorganization of government ministries. Nonetheless, environmental markets were particularly strong for Hach and Shimadzu AMI, led by China.
All major regions showed growth for Index companies in the calendar year second quarter. Unaffected by macroeconomic concerns, Chinese sales were particularly strong. Agilent, BioTechne, Illumina, QIAGEN, Thermo Fisher and Waters each reported double digit revenue growth in the country and remained optimistic about sales this year.
In fact, for Asia overall, sales for life science product lines were especially strong. Including China, Illumina sales in the region grew 32%, Bio-Techne sales rose in the mid-teens and Merck Life Science’s Asian revenues were up nearly 14% in constant currency. However, QIAGEN sales to the region grew just 1%. Additionally, Danaher Life Science and Bio-Techne reported strength in Japanese sales, a pick up from recent trends.
Americas sales growth was also healthy, up double digits for Illumina, QIAGEN and Shimadzu AMI. In contrast, Waters’ US sales declined.
European sales for Index companies were mixed. At the high point, Shimadzu AMI sales rose 18%, but Agilent recorded flat sales due to year over year comparison. Illumina reported EMEA growth of over 30%, while Tecan’s first-half sales were up 24% for the region.
Both instrument and consumables revenues did well for several companies, including Agilent, BSI and PerkinElmer DAS. For instruments in particular, BSI and Thermo Fisher reported good growth for MS, although Waters noted slower sales for its high-end MS systems. All three companies reported healthy LC sales. In contrast, Shimadzu reported slower LC revenue growth due to declines in Japan and China. Both Agilent and Shimadzu noted good GC growth, assisted by petrochemical sales in China. Molecular spectroscopy system revenue growth was highlighted by Agilent as well as BSI. For life science applications, both BSI and PE reported good in vivo imaging sales growth.
Life Science Sales Index
IBO Life Science Sales Index revenues increased year over year, led by particularly strong growth from Illumina. QIAGEN Life Science and Tecan Life Science recorded low-single digit growth, noting the effect of year-over-year comparisons, while NanoString Technologies’ sales declined.
Index operating profit margin was flat, as a number of companies stepped up investments in new markets and product lines. Affecting the growth were notable increases for Bio-Rad Life Sciences and Illumina, driven by stronger-than-usual second quarter sales.
Analytical Sales Index
Organic sales growth for the Index decreased slightly from calendar year first quarter, but was up year over year. Industrial sales continued their rebound. Demand was broad based, spanning a number of technologies, including ICP-MS and LC/MS.
Operating margins improvement increased from a year ago, with businesses such as Spectris Materials Analysis and Thermo Fisher Scientific, focused on operational improvements. Agilent Technologies and PerkinElmer each increased operating margin by over one hundred basis points.
IBO Life Science Index: Bio-Rad Laboratories (Life Science); Biotage; Bio-Techne (Biotechnology, Protein Platforms); Fluidigm*; Illumina; Merck KGaA (Life Science)*; NanoString Technologies; Pacific Biosciences; QIAGEN (Life Sciences); Tecan (Life Sciences); Thermo Fisher Scientific (Life Science Solutions).
IBO Analytical Instrument Index: Agilent Technologies (Life Sciences and Applied Markets, Agilent Crosslab); Bruker (Scientific Instruments); HORIBA (Process and Environmental Instruments & Systems, Scientific Instruments & Systems); Oxford Instruments*; PerkinElmer (Discovery and Analytical Solutions); Shimadzu (Analytical and Measuring Instruments); Spectris (Materials Analysis)*; Thermo Fisher Scientific (Analytical Technologies); Waters*.
*Adjusted operating profit used in calculations