Eleven of the 18 companies in the IBO Laboratory Instrument Sales Index reported fourth-quarter 2012 results before this issue’s publication. Including estimates for firms yet to report, fourth-quarter 2012 revenue for the Index improved 2.9%, or 3.8% excluding currency. Operating profit for the Index edged 0.4% higher. Based on continuing operations, operating margin slipped 70 basis points to 19.9% of sales. Full-year revenues are estimated to have grown 2%, 3% excluding currency, and operating profit is projected to have risen 3%.

Affymetrix’s fourth-quarter sales improved 1.8% organically, 29.6% including the eBioscience acquisition (see IBO 6/30/12), to $84.4 million. Product sales slipped 0.6% organically, but grew 30.2% including the acquisition to make up 91% of sales. Core Consumable revenue declined 3.3% to $53.1 million, Instrument sales climbed 36.8% to $5.2 million, and eBioscience sales, which grew 6% excluding currency, contributed $18.1 million. Service and Other revenue grew 23.7% to account for 9% of sales due to genotyping services.

Affymetrix’s Expression revenue fell 10% to account for roughly 32% of sales. GeneChip sales sank 14%, including a 23% decline for in vitro transcription revenue. However, sales of whole-transcriptome and mRNA arrays grew 2%. Panomics product sales climbed 11%, including 60% and 39% growth for the QuantiGene and Procarta product lines, respectively. Sales for Genetic Analysis and Clinical Applications (GACA) jumped 31% to make up 28% of revenues. Sales of CytoScan and Axiom products each grew more than 100%. Life Science Reagents (LSR) revenue was flat to make up 9% of sales. For eBioscience, sales of flow cytometry and immunoassays products grew 6% and 7%, respectively, while OEM sales remained under pressure. Fourth-quarter adjusted operating profit was $2.7 million, compared with a loss of $6.3 million due to lower R&D and SG&A expenses as a percentage of sales. Adjusted profit margin climbed 670 basis points to 60.8% of sales. Operational initiatives announced during the quarter included a workforce reduction (see IBO 1/15/2013), consolidation of manufacturing facilities in Singapore and the US, and a direct distribution channel for eBioscience in Japan.

For the year, Affymetrix sales declined 2% organically, but grew 10.5% including eBioscience to $295.6 million. Product sales fell 9.5% organically, but expanded 10.3% with the acquisition to make up 90% of sales. Core Consumable revenue declined 6.4% to $210.7 million, Instrument sales grew 12.9% to $18.4 million, and eBioscience sales climbed 5% excluding currency to $37.0 million. Service and Other revenue improved 12.8% to account for 10% of sales. Expression sales fell around 13% to account for 41% of sales. GACA sales grew 17% to account for 28%. Sales of Axiom genotyping products grew 45%, and sales of cytogenetic products roughly tripled to account for roughly 10% of sales. The company more than doubled the number of cytogenetic customers to more than 180 accounts. LSR sales declined roughly 5% to make up 11% of sales. Overall, sales to North America, Europe and the Rest of the World accounted for 50%, 30% and 20% of sales, respectively. Adjusted operating profit was $1.5 million, compared with a loss of $7.5 million a year ago. Adjusted gross margin expanded 60 basis points to 59.9% of sales. The company expects to reach a net profit in 2013 with revenues of at least $330 million, including double-digit growth for GACA, low single-digit growth for LSR, and mid-single digit growth for eBioscience, which should account for 22% of sales. Expression sales are expected to fall 10% to make up less than 33% of sales.

Analytik Jena’s fiscal first-quarter sales ending December 31, 2012, grew 4.9% to €24.3 million ($31.6 million = €0.77 = $1) (see page 12). Operating profit slumped 35.2% to €1.2 million ($1.6 million) due to currency and pricing pressures. Gross margin fell 170 basis points to 48.1% of sales. Sales in Germany and other European countries improved 2.8% and 2.5% to account for 29% and 25% of sales, respectively. Sales to Asia jumped 19.5% to make up 38%. Sales to America and Rest of World fell 27.4% and 28.5% to represent 6% and 2%, respectively. Analytical Solutions (AI) sales climbed 11.9% to account for 65% of sales. AI operating profit dropped 17.0% to €1.2 million ($1.6 million), and gross profit margin declined 120 basis points to 49.5% of AI sales. Life Science (LS) revenue declined 7.5% to account for 30% of sales, primarily due to slower US and European sales from CyBio and Biometra and due to a delayed order contract with one of Biometra’s partners in China. LS operating profit fell 96.8% to just above breakeven, and gross profit margin slipped 40 basis points to 49.5% of LS sales.

Luminex’s fourth-quarter revenues climbed 16.0% to $55.5 million (see page 12). Assay and Consumable sales climbed 45.0% and 23.0% to account for 43% and 22% of sales, respectively. Assay sales benefited from inventory buildup by two partners and strong demand for infectious disease products, which accounted for 68% of total Assay sales. Consumables and Royalty revenues expanded 23.0% and 6.0% to represent 22% and 14% of sales, respectively. System sales fell 31.6% to make up 13% due to a 26% decline in systems sold to 226 units. All Other revenue grew 22.1% to account for 8%. Adjusted operating profit jumped 54.8% to $8.6 million as a result of higher gross profit and lower operating expenses as a percentage of sales. Gross margin expanded 300 basis points to 70.9% of sales because of product mix. Technology and Strategic Partnerships (TSP) revenue was flat at $29.7 million, and operating income fell 45.2% to $2.3 million. Revenue for Assays and Related Products (ARP) grew 42.5% to $25.9 million, and operating profit climbed to $4.9 million from a loss of $0.3 million.

Full-year revenues for Luminex grew 9.9%, 4.8% excluding the acquisition of EraGen (see IBO 6/30/11), to $202.6 million. Assay sales climbed 54.1%, 35% excluding the acquisition, to make up 37% of sales. Royalty and All Other revenues improved 6.7% and 14.6% to represent 15% and 9% of sales, respectively. Consumables and System revenues declined 13.4% each to make up 24% and 15%, respectively. Excluding a large bulk order in 2011, Consumables sales would have increased 5%. System revenue declined due to a shift toward the lower-priced MAGPIX system, for which sales climbed 52% to 420 units. LX and MAGPIX systems represented 52% and 43% of analyzers sold, respectively. The company placed 982 multiplexing analyzers, which was similar to a year ago. Adjusted operating profit fell 4.0% to $28.1 million due to infrastructure enhancements and R&D expenses. Gross profit margin improved 230 basis points to 70.4% of sales. TSP revenue declined 5.3% to $121.0 million, and operating income slumped 49.7% to $15.0 million. Revenues for ARP climbed 44.2% to $81.6 million, and operating profit was $7.7 million, compared with a loss of $6.1 million a year ago. The company projected full-year 2013 revenue to grow 9%–14% to $220–$230 million, including strong demand for molecular diagnostics assay tests and double-digit growth for both Consumables and Royalty revenues.

Fiscal third-quarter sales for Shimadzu’s Analytical and Measuring Instrument (AMI) division grew 4.4% to ¥35.0 billion ($430.2 million = ¥81.27 = $1) to represent 58% of company revenues (see page 12). AMI operating profit declined 37.7% to ¥1.3 billion ($16.1 million). For the first nine months, sales increased 2.3%, including higher domestic and overseas sales. Within Japan, MS sales increased due to new high-end systems and replacement orders from government and academic markets. GC sales also improved due to replacement orders. However, LC sales declined in Japan due to lower capital spending by pharmaceutical manufacturing customers. In North America, sales expanded due to strong sales of MS and GCs to universities and testing laboratories, respectively. Within China, sales of MS and spectrophotometers were strong due to increased investments in R&D and food inspection. In Southeast Asia, LC sales were strong. European markets remained under significant pressure.

 Column Chart: Quarterly Organic Sales Change

 January 2009–December 2012

 Year      Q1     Q2     Q3    Q4

 2009   -2.2%  -5.7%  -4.5%  0.5%

 2010    8.0%   9.1%  10.5%  7.1%

 2011    7.1%   8.3%   5.7%  6.9%

 2012    4.2%   3.1%   2.4%  3.8%

 Column Chart: Quarterly Operating Profit Margins

 January 2009–December 2012

 Year     Q1     Q2     Q3     Q4

 2009  17.4%  17.9%  18.3%  19.9%

 2010  19.8%  18.9%  19.8%  19.9%

 2011  19.2%  18.9%  19.0%  20.6%

 2012  18.5%  17.7%  19.0%  19.9%

 Laboratory Instrument Index                                               % Change

                                  2009     2010     2011     2012  2009–10  2010–11  2011–12

 Total Annual Revenues ($M)    $19,756  $21,505  $23,429  $23,931     8.9%     8.9%     2.1%

 Annual Oper. Profits ($M)      $3,676   $4,308   $4,883   $5,027    17.2%    13.4%     2.9%

 4th Quarter Revenues ($M)      $5,567   $5,912   $6,348   $6,536     6.2%     7.4%     2.9%

 4th Quarter Oper. Profits ($M) $1,139   $1,242   $1,443   $1,449     9.0%    16.2%     0.4%