Agilent Profit Drops, Yet Tops Estimates

(RTTNews) - Scientific instruments maker Agilent Technologies Inc. (A), Thursday reported a decline in fourth-quarter profit, hurt by a three percent drop in revenue amid continued market weakness, while the prior year included a tax benefit. Nonetheless, earnings for the quarter topped Wall Street estimates as did revenue.

Agilent, which is splitting into two companies, provided a weak outlook for the first quarter, while expectations for 2014 appear promising. Agilent shares gained 5 percent in after-hours trade on the New York Stock Exchange, following the announcement.

The results come amid challenges in several markets even as Agilent built good orders and cut expenses, said CEO Bill Sullivan.

Agilent has been facing revenue pressure for the past quarters. The company has raised its business in Asia but has been subdued in the volatile European region.

To spur growth, Agilent, in September, said it will separate into two publicly traded firms, the process of which is expected to be completed by November 2014.

But investors are cautious about the split off, wondering whether Agilent can stave off competition from Danaher (DHR) and new entrants like General Electric (GE).

In its fourth quarter, Santa Clara, California-based Agilent reported net income of $211 million or $0.63 per share, compared with $425 million or $1.20 per share last year.

Results for the quarter included amortization charges of $48 million, among other items., while the prior year recorded a tax benefit of $169 million.

Excluding items, adjusted earnings for the quarter were $271 million or $0.81 per share, compared with $303 million or $0.86 per share a year ago.

On average, 18 analysts polled by Thomson Reuters estimated earnings of $0.76 per share for the quarter. Analysts' estimates typically exclude special items.

Revenue for the fourth quarter dropped to $1.72 billion from $1.77 billion in the prior year. Analysts had a consensus revenue estimate of $1.71 billion for the quarter.

Among segments, Electronic Measurement revenue slid 14 percent year-over-year. Chemical Analysis revenue was up 4 percent, led by growth in food and energy markets.

Life Sciences and Diagnostic revenue climbed 8 percent from last year, on strength in pharmaceuticals and diagnostics markets.

Results were somewhat helped by operating expenses that declined 4 percent to $1.43 billion.

Orders at the end of the quarter were up 4 percent from last year at $1.83 billion.

For the first quarter, Agilent expect adjusted earnings in the range of $0.65 to $0.67 per share and revenue of $1.68 billion to $1.70 billion. Analysts currently expect earnings of $0.73 per share on revenue of $1.72 billion for the quarter.

For fiscal year 2014, the company expect adjusted earnings in the range of $3.03 to $3.33 per share on revenue of $6.95 billion to $7.15 billion. Analysts currently expect earnings of $3.17 per share on revenue of $7.04 billion for the year.

Agilent stock closed Thursday at $50.54, down $0.66 or 1.29%, on a volume of 2.6 million shares. In after hours, the stock gained $2.40 or 4.75% at $52.94. In the past year, the stock traded in the range of $35.45 - $53.47.