Calendar year third quarter sales growth for publicly held instrument and lab products businesses maintained healthy, mid-single digit growth as a result of improved academic and government, and industrial end-market sales. Overall, sales to all end-markets increased, with particular strength in the applied market. Geographically, all major regions performed to company expectations, with Asia Pacific sales showing continued growth. Sales growth in Europe and the Americas also was healthy, driven by increased demand across most end-markets.
Combined calendar year third quarter sales for 14 of the 22 IBO Life Science and Analytical Instrument Indexes (LSA Indexes) companies and business units that have reported at publication time rose 6.3% on a reported basis. Sequentially, sales growth increased 40 basis points from 5.9%, but year-over-year growth decreased, down 1.3 percentage points. Organic growth for the IBO LSA Indexes, which excludes acquisitions and currency effects, fell 30 basis points sequentially, 1.9 percentage points year-over-year, to 5.9%.
Third quarter biopharmaceutical sales for companies in the LSA Indexes that reported such results grew modestly. Sales growth remained mostly in the mid-single digits, with Shimadzu experiencing sales growth in the high-single digits. Waters’ revenue growth for this market also grew solidly, driven by strong instrument system and chemistry-related sales. Bio-Techne and PerkinElmer both experienced mid-single digit biopharma sales growth, driven by continued demand in Europe. Agilent Technologies’ biopharmaceutical sales declined mid-single digit, primarily due to weakened sales for nucleic acid solution products.
Academic & Government Markets
Academic and government sales for companies in the LSA Indexes reporting results for this market are estimated to have risen substantially, driven by Agilent and Waters. The majority of the companies in the Index experienced sales growth in the low-single digits for this market, with Bio-Techne and Thermo Fisher Scientific reporting mid- to high-single digit growth. Solid sales for the two companies resulted from increased regional sales, particularly in Europe and China. Similarly, Agilent and Waters both delivered double-digit growth for the market due to strong sales in Asia and Europe, as well as increased demand across most of their product lines.
LSA Index companies’ sales for the industrial end-markets of those companies that specified such demand remained robust, growing in the mid-single digits. Both Waters and Thermo Fisher Scientific delivered mid- to high-single digit growth to lift Index industrial sales. Both companies experienced increased demand in the European region, along with strengthened demand in the Asia Pacific. Sequentially, industrial sales for Waters and Thermo Fisher each grew around 4% due to higher aftermarket and service revenues. Bruker Scientific Instrument also experienced significant sequential gains, with low-single digit growth.
Applied sales for the companies in the LSA Indexes that reported such sales grew strongly this quarter, propelled by solid QIAGEN sales. QIAGEN delivered mid-double digit sales growth in this market, driven by forensic sales. Overall, applied sales growth increased in the mid-single digits. Food revenue for the quarter advanced substantially, largely driven by double-digit sales growth from PerkinElmer and Agilent. Environmental sales growth was mostly positive, with Thermo Fisher revenues in this market advancing in mid-single digits.
Geographically, the Asia Pacific region delivered the fastest growth this quarter for companies in the LSA Indexes, with sales generally increasing nearly double digits. The strength in the APAC region was largely driven by China. Sales in China rose significantly, up double-digits in general, whereas sales in Japan grew mid-single digits in general. Asia Pacific sales among grew double digits for Bio-Techne, Fluidigm, HORIBA, Illumina, Shimadzu and Thermo Fisher. In particular, APAC sales for Bio-Techne and HORIBA grew in the mid- to high-double digits, while sales for Shimadzu and Thermo Fisher rose low double digits. However, Fluidigm experienced the fastest growth in the APAC region, as sales increased over 30%. Conversely, Nanostring Technologies’ sales in the region declined mid-single digits due to weakened demand for instruments and consumables.
European sales for LSA Index companies are estimated to have grown in the mid-single digits in total, driven by robust academic, biopharmaceutical and industrial sales. European sales remained mostly positive, with Fluidigm and Waters delivering significant double-digit growth, and Fluidigm’s sales grew nearly 50%, largely driven by a recovery in demand. Waters experienced nearly 20% growth in European sales, propelled by overall product and service revenue increases. Companies that also experienced in double-digit sales increases were Bio-Techne, Bruker, Illumina, QIAGEN and Shimadzu.
Sales in the Americas remained healthy for companies in the LSA Index, climbing in the mid-single digits. Most companies experienced mid-single digit sales growth, but Illumina, Nanostring and Shimadzu sales grew double-digits. Sales in the Americas for Shimadzu advanced nearly 16%, boosted by steady sales in the US. In fact, Shimadzu experienced double-digit growth across all three major regions, Americas, Europe and Asia Pacific. Illumina, which experienced around a 20% increase in American sales, similarly experienced double-digit sales growth across the three regions. Fluidigm, however, recorded a double-digit sales decline in the Americas.
Life Science Index Sales
Third quarter revenue for the IBO Life Science Sales Index for the companies that have reported increased 5.7%, on a reported basis to $4,229.1 million. Organically, sales rose 6.7%, primarily driven by strong industrial and applied end-market revenues. Sequentially, Index sales rose 1.1 percentage points on a reported basis. Organically, sales growth increased 1.8 percentage points from the second quarter.
However, year-over-year growth fell for both reported and organic sales. Reported sales growth decreased 3.7 percentage points, while organic sales growth fell 2.8 percentage points. Adjusted operating profit for the Index rose 3.0% to $933.2 million, while adjusted operating margin rose 2.2 percentage points to 21.4%.
Analytical Instrument Index Sales
Third quarter sales for the IBO Analytical Instrument Sales Index for the companies that have announced results rose 6.9% to $4,050.0 million on a reported basis. Organically, sales rose 5.1%, driven by European sales and strong overall end-market growth. Biopharmaceutical sales, as well as industrial sales, further added to growth. Sequentially, reported sales growth decreased 60 basis points, while organic sales growth fell 2.8 percentage points. Year over year, organic sales growth fell 90 basis points, while reported sales growth advanced 1.2 percentage points. Adjusted operating profit rose 14.5% to $868.3 million, while adjusted operating margin increased by 1.2 percentage points to 20.7%.
Reported IBO Indexes’ sales growth excludes acquisitions and are based on constant exchange rates for international companies when converted into US dollars.
IBO Life Science Index businesses: Becton, Dickinson (BD Biosciences); Bio-Rad Laboratories (Life Science); Biotage; Bio-Techne (Biotechnology, Protein Platforms); Fluidigm (Product); Illumina; Merck KGaA (Life Science); NanoString Technologies; Pacific Biosciences (Products, Services); QIAGEN (Life Sciences); Tecan (Life Sciences); Thermo Fisher Scientific (Life Science Solutions).
IBO Analytical Instrument Index businesses: 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 & Analytical Solutions); Shimadzu (Analytical and Measuring Instruments); Spectris (Materials Analysis); Thermo Fisher Scientific (Analytical Technologies); Waters.