Thermo Fisher Scientific Sees Record Third Quarter, Thanks to Growth in China

Researched by Industrial Info Resources (Sugar Land, Texas)--Despite weakening currencies in foreign markets and sequestration from the U.S. federal government, Thermo Fisher Scientific Incorporated (NYSE:TMO) (Waltham, Massachusetts) announced third-quarter revenue of $3.19 billion, up 3% from the third quarter of 2012. The science-serving biotech company says this is a record for the third quarter, attributing it to increased production and strong growth in emerging markets.

Industrial Info is tracking more than $150 million in projects for Thermo Fisher and more than $18 million in projects for the soon-to-be-acquired Life Technologies Corporation (NASDAQ:LIFE) (Carlsbad, California).

"I am also pleased to report that we continue to make good progress on planning the integration of Life Technologies," said President and Chief Executive Officer of Thermo Fisher, Mark Casper in a press release. "We're excited about the tremendous value this transaction will create for our customers, employees and shareholders, and remain on track to close early in 2014."

In a webcast on October 23, Peter Wilver, senior vice president and chief financial officer, attributed an increase of 1% to $997 million in the Analytical Technologies segment to a strong growth in mass specs and instrumentation for applied markets, as well as a great performance in China. This productivity was offset by softness in core industrial and U.S. government projects. Third-quarter 2012 revenue for Analytical Technologies was $987 million.

The Specialty Diagnostics segment saw $759 million in revenue, an increase of 7% from third-quarter 2012. Wilver reported that bio markers and transplant diagnostics, which have seen consistent performance that exceeds expectations, are to thank for the increase. Again, softness in healthcare utilization and reimbursement pressures brought down growth.

Clinical trials and channels positivity spurred $1.58 billion in revenues for the Laboratory Products and Services segment, up 4% from third-quarter 2012. This segment was hit hardest by the federal sequestration.

Regionally, Thermo Fisher saw a decline in growth from North America, while Europe produced rates in the low single digits. Asia grew more than 20%, primarily due to a 20% growth in China. The remainder of the world also saw 20% growth, which was credited to Latin America.

"In Asia-Pacific and emerging markets, our China team continued its excellent growth momentum, with another quarter of strong double-digit revenue performance," said Casper. "During the quarter, we expanded our presence by opening a new production facility in Singapore to meet growing demand for vaccines and therapeutics."

Due to the record growth, Thermo Fisher expects to meet its goals for the year. Consequently, it is raising revenue guidance by $40 million, for a 2013 growth rate of 3% to 4% over 2012.

Adding to growth is the Fremont Grassroot Reagents Manufacturing Research and Development Plant under construction in Fremont, California. The project is designed by Geis Companies and will enhance biotechnology upon its completion in first-quarter 2015.

For more information, visit Industrial Info's Pharmaceutical and Biotech Database.

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