Bruker Reports Fourth Quarter and Fiscal Year 2017 Financial Results

BILLERICA, Mass., Feb. 8, 2018 /PRNewswire/ -- Bruker Corporation (NASDAQ: BRKR) today announced financial results for its fourth quarter and fiscal year ended December 31, 2017.

Bruker's revenues for the fourth quarter of 2017 were $530.5 million, an increase of 12.8% compared to the fourth quarter of 2016. In the fourth quarter of 2017, Bruker's year-over-year organic revenue growth was 4.0%, while growth from acquisitions was 3.6%, and the favorable effect from changes in foreign currency rates was 5.2%.

Fourth quarter 2017 GAAP operating income was $93.7 million, compared to $76.9 million in the fourth quarter of 2016, and GAAP operating margin was 17.7%, versus 16.4% in the fourth quarter of 2016. Non-GAAP operating income was $110.8 million, an increase of 20% over $92.0 million in the fourth quarter of 2016. Bruker's fourth quarter 2017 non-GAAP operating margin was 20.9%, compared to 19.6% in the fourth quarter of 2016.

Due to the effects of U.S. tax reform, Bruker recorded a charge of $68.9 million in the fourth quarter 2017, resulting in a GAAP loss per diluted share of ($0.02), compared to GAAP earnings per diluted share (EPS) of $0.43 in the fourth quarter of 2016. Fourth quarter 2017 non-GAAP EPS were $0.51, an increase of 11% compared to $0.46 in the fourth quarter of 2016. A reconciliation of non-GAAP to GAAP financial measures is provided in the tables accompanying this press release.

For the year 2017, Bruker's revenues increased 9.6% to $1.766 billion, compared to $1.611 billion in the year 2016. In 2017, Bruker's year-over-year organic revenue growth was 3.6%, while growth from acquisitions was 4.8%, and the favorable effect from changes in foreign currency rates was 1.2%. Bruker's year-over-year organic revenue growth of 3.6% in 2017 consisted of organic revenue growth of 2.7% in the Bruker Scientific Instruments (BSI) segment and of 14.5% in the BEST segment, net of intercompany eliminations.

For the year 2017, GAAP operating income was $214.7 million, compared to $177.2 million in 2016, and GAAP operating margin was 12.2%, versus 11.0% in 2016. Non-GAAP operating income was $276.1 million in 2017, an increase of 16% over non-GAAP operating income of $237.9 million in 2016. Bruker's 2017 non-GAAP operating margin was 15.6%, compared to 14.8% in 2016.

Fiscal year 2017 GAAP diluted EPS were $0.49, compared to $0.95 in 2016. The decrease was primarily due to the effects of U.S. tax reform in the fourth quarter of 2017. Non-GAAP EPS for 2017 were $1.21, compared to $1.19 in the year 2016, which had benefitted from an unusually favorable tax rate, as previously disclosed.

Frank Laukien, President and CEO of Bruker, commented: "We are encouraged by our finish to the year, as Bruker exceeded our recently increased full year 2017 revenue growth and non-GAAP EPS objectives. In 2017, low-single digit year-over-year organic revenue growth returned to our core Scientific Instruments segment, whereas our BEST segment delivered mid-teens organic revenue growth. For 2018, we expect further gradual improvement in our full year Scientific Instruments organic growth rate, while BEST revenues are expected to decline in the low single digits organically year-over-year."

Dr. Laukien continued: "We are also pleased that Bruker achieved 80 bps of non-GAAP operating margin expansion in 2017, even with 45 bps of acquisition headwinds and 20 bps of currency headwinds. For the full year 2018, we expect continued healthy non-GAAP operating margin expansion, despite a substantial currency headwind."

Fiscal Year 2018 Financial Outlook

Bruker is providing initial revenue growth, operating margin expansion and EPS guidance for fiscal year (FY) 2018 based on average foreign exchange rates for the month of January 2018.

For FY 2018, the Company expects revenue growth of approximately 7%, including organic revenue growth of approximately 3%, and a foreign currency revenue tailwind of approximately 4%. The Company projects an increase in FY 2018 non-GAAP operating margin ranging from 50 basis points (bps) to 80 bps year-over-year, including an estimated 70 bps margin headwind from foreign currency translation. Finally, for FY 2018 Bruker expects non-GAAP EPS between $1.34 and $1.38, an 11% to 14% increase compared to 2017.

For the Company's outlook for FY 2018 non-GAAP operating margin and non-GAAP EPS, we are not able to provide without unreasonable effort the most directly comparable GAAP financial measures, or reconciliations to such GAAP financial measures on a forward-looking basis. Please see "Use of Non-GAAP Financial Measures" below for a description of items excluded from our expected non-GAAP operating margin and non-GAAP EPS.

Quarterly Earnings Call

Bruker will host a conference call and webcast to discuss its financial results, business outlook, and related corporate and financial matters today at 4:30 p.m. Eastern Standard Time.  To listen to the webcast, investors can go to http://ir.bruker.com and click on the "Events & Presentations" hyperlink.  A slide presentation that will be referenced during the webcast will be posted to the Company's website shortly before the webcast begins.  Investors can also listen to the earnings webcast via telephone by dialing 1-888-437-2685 (US toll free) or +1-412-317-6702 (international), and referencing "Bruker's Fourth Quarter and Fiscal Year 2017 Earnings Conference Call".  A telephone replay of the conference call will be available by dialing 1-877-344-7529 (US toll free) or +1-412-317-0088 (international) and entering conference number: 10116535. The replay will be available beginning one hour after the end of the conference through March 8, 2018.

About Bruker Corporation

For more than 55 years, Bruker has enabled scientists to make breakthrough discoveries and develop new applications that improve the quality of human life. Bruker's high-performance scientific instruments and high-value analytical and diagnostic solutions enable scientists to explore life and materials at molecular, cellular and microscopic levels. In close cooperation with our customers, Bruker is enabling innovation, improved productivity and customer success in life science molecular research, in applied and pharma applications, in microscopy and nanoanalysis, and in industrial applications, as well as in cell biology, preclinical imaging, clinical phenomics and proteomics research, microbiology and molecular pathology research. For more information, please visit: www.bruker.com.

Use of Non-GAAP Financial Measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles (GAAP), we use the following non-GAAP financial measures in this press release and in the earnings webcast: non-GAAP gross profit; non-GAAP gross profit margin; non-GAAP operating income; non-GAAP operating margin; non-GAAP profit before tax; non-GAAP tax rate; non-GAAP net income and non-GAAP earnings per share. These non-GAAP measures exclude costs related to restructuring actions, acquisition and related integration expenses, amortization of acquired intangible assets, the estimated impact of US tax reform and other non-operational costs.

We also refer to organic revenue growth, return on invested capital and free cash flow in this press release and in the earnings webcast, which are also non-GAAP financial measures. We define the term organic revenue as GAAP revenue excluding the effect of changes in foreign currency translation rates and the effect of acquisitions and divestitures, and believe it is a useful measure to evaluate our continuing business.  We define free cash flow as net cash provided by operating activities less additions to property, plant, and equipment.  We believe free cash flow is a useful measure to evaluate our business because it indicates the amount of cash generated after additions to property, plant, and equipment that is available for, among other things, acquisitions, investments in our business, repayment of debt and return of capital to shareholders. We define return on invested capital (ROIC) as non-GAAP operating profit after income tax divided by average total capital, which we define as debt plus equity minus cash.  We believe ROIC is an important measure of how effectively the Company invests its capital.

The presentation of these non-GAAP financial measures is not intended to be a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP and may be different from non-GAAP financial measures used by other companies, and therefore, may not be comparable among companies.  We believe these non-GAAP financial measures provide meaningful supplemental information regarding our performance. Specifically, management believes that the non-GAAP measures mentioned above provide relevant and useful information which is widely used by analysts, investors and competitors in our industry, as well as by our management, in assessing both consolidated and business unit performance. 

We use these non-GAAP financial measures to evaluate our period-over-period operating performance because our management believes this provides a more comparable measure of our continuing business by adjusting for certain items that are not reflective of the underlying performance of our business. These measures may also be useful to investors in evaluating the underlying operating performance of our business and forecasting future results.  We regularly use these non-GAAP financial measures internally to understand, manage, and evaluate our business results and make operating decisions.  We also measure our employees and compensate them, in part, based on such non-GAAP measures and use this information for our planning and forecasting activities. 

Additional information relating to these non-GAAP financial measures and reconciliations to the most directly comparable GAAP financial measures is provided in the tables accompanying this press release following our GAAP financial statements and in our slide presentation, which is available through the "Earnings Release" hyperlink on Bruker's Investor Relations web site ir.bruker.com. 

With respect to the Company's outlook for 2018 non-GAAP operating margin, non-GAAP EPS and non-GAAP tax rate, we are not providing the most directly comparable GAAP financial measures or corresponding reconciliations to such GAAP financial measures on a forward-looking basis, because we are unable to predict with reasonable certainty certain items that may affect such measures calculated and presented in accordance with GAAP without unreasonable effort. Our expected non-GAAP operating margin, tax rate and EPS ranges exclude primarily the future impact of restructuring actions, unusual gains and losses, acquisition-related expenses and purchase accounting fair value adjustments. These reconciling items are uncertain, depend on various factors outside our management's control and could significantly impact, either individually or in the aggregate, our future period operating margins, EPS and tax rate calculated and presented in accordance with GAAP.

Forward Looking Statements

Any statements contained in this press release which do not describe historical facts may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein are based on current expectations, but are subject to risks and uncertainties that could cause actual results to differ materially from those indicated, including, but not limited to, risks and uncertainties relating to adverse changes in conditions in the global economy and volatility in the capital markets, the integration of businesses we have acquired or may acquire in the future, fluctuations in foreign currency exchange rates, our ability to successfully implement our restructuring initiatives, changing technologies, product development and market acceptance of our products, the cost and pricing of our products, manufacturing, competition, dependence on collaborative partners, key suppliers and contract manufacturers, capital spending and government funding policies, changes in governmental regulations, the use and protection of intellectual property rights, litigation, and other risk factors discussed from time to time in our filings with the Securities and Exchange Commission, or SEC. These and other factors are identified and described in more detail in our filings with the SEC, including, without limitation, our annual report on Form 10-K for the year ended December 31, 2016 and subsequently filed Quarterly Reports on Form 10-Q. We expressly disclaim any intent or obligation to update these forward-looking statements other than as required by law.

-tables follow-

 

 

 

 

 

 

 

 

 

 

 

 

Contacts: Miroslava Minkova   Head of Investor RelationsBruker Corporation T: +1 (978) 663 – 3660, ext. 1479E: [email protected] 

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SOURCE Bruker Corporation