Revenue of $671 million; (6)% reported growth; (7)% organic growth; 1% non-COVID organic growth
GAAP EPS of $0.08; Adjusted EPS from continuing operations of $1.18
Updates full year 2023 guidance
WALTHAM, Mass.–(BUSINESS WIRE)–Revvity, Inc. (NYSE: RVTY), today reported financial results for the third quarter ended October 1, 2023.
The Company reported GAAP earnings per share of $0.08, as compared to $0.67 in the same period a year ago. GAAP revenue for the quarter was $671 million, as compared to $712 million in the same period a year ago. GAAP operating income from continuing operations for the quarter was $69 million, as compared to $111 million for the same period a year ago. GAAP operating profit margin from continuing operations was 10.3% as a percentage of revenue, as compared to 15.6% in the same period a year ago.
Adjusted earnings per share from continuing operations for the quarter was $1.18, as compared to $1.21 in the same period a year ago. Adjusted revenue for the quarter was $671 million, as compared to $712 million in the same period a year ago. Adjusted operating income was $185 million, as compared to $224 million for the same period a year ago. Adjusted operating profit margin was 27.5% as a percentage of adjusted revenue, as compared to 31.4% in the same period a year ago.
Adjustments for the Company’s non-GAAP financial measures have been noted in the attached reconciliations.
“We executed well during the third quarter in an increasingly challenging end market environment,” said Prahlad Singh, president and chief executive officer of Revvity. “During this period of increased market uncertainty, we will focus our efforts on those factors we can control to ensure the Company emerges from this period in an even stronger and more agile position.”
Financial Overview by Reporting Segment for the Third Quarter
Life Sciences
Third quarter 2023 revenue was $308 million, as compared to $313 million in the same period a year ago. Reported revenue decreased 2% and organic revenue decreased 3% as compared to the same period a year ago.
Third quarter 2023 adjusted operating income was $114 million, as compared to $117 million in the same period a year ago.
Third quarter 2023 adjusted operating profit margin was 37.1% as a percentage of adjusted revenue, as compared to 37.4% in the same period a year ago.
Diagnostics
Third quarter 2023 revenue was $363 million, as compared to $399 million in the same period a year ago. Reported revenue decreased 9% and organic revenue decreased 10% as compared to the same period a year ago.
Third quarter 2023 adjusted operating income was $82 million, as compared to $123 million in the same period a year ago.
Third quarter 2023 adjusted operating profit margin was 22.5% as a percentage of adjusted revenue, as compared to 30.9% in the same period a year ago.
Updates Full Year 2023 Guidance
For the full year 2023, the Company now forecasts total revenue of $2.72-$2.74 billion and adjusted earnings per share of $4.53-$4.57. This guidance assumes no additional contribution from COVID related revenues.
Guidance for the full year 2023 is provided on a non-GAAP basis and cannot be reconciled to the closest GAAP measures without unreasonable effort due to the unpredictability of the amounts and timing of events affecting the items the Company excludes from these non-GAAP measures. The timing and amounts of such events and items could be material to the Company’s results prepared in accordance with GAAP.
Webcast Information
The Company will discuss its third quarter 2023 results and its outlook for business trends during a webcast on October 30, 2023, at 8:00 a.m. Eastern Time. A live audio webcast and presentation will be available on the Investors section of the Company’s website, ir.revvity.com.
Use of Non-GAAP Financial Measures
In addition to financial measures prepared in accordance with generally accepted accounting principles (GAAP), this earnings announcement also contains non-GAAP financial measures. The reasons that we use these measures, a reconciliation of these measures to the most directly comparable GAAP measures, and other information relating to these measures are included below following our GAAP financial statements.
Factors Affecting Future Performance
This press release contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements relating to estimates and projections of future earnings per share, cash flow and revenue growth and other financial results, developments relating to our customers and end-markets, and plans concerning business development opportunities, acquisitions and divestitures. Words such as “believes,” “intends,” “anticipates,” “plans,” “expects,” “estimates”, “projects,” “forecasts,” “will” and similar expressions, and references to guidance, are intended to identify forward-looking statements. Such statements are based on management’s current assumptions and expectations and no assurances can be given that our assumptions or expectations will prove to be correct. A number of important risk factors could cause actual results to differ materially from the results described, implied or projected in any forward-looking statements. These factors include, without limitation: (1) markets into which we sell our products declining or not growing as anticipated; (2) the effect of the COVID-19 pandemic on our sales and operations; (3) fluctuations in the global economic and political environments; (4) our failure to introduce new products in a timely manner; (5) our ability to execute acquisitions and divestitures, license technologies, or to successfully integrate acquired businesses and licensed technologies into our existing business or to make them profitable; (6) our ability to compete effectively; (7) fluctuation in our quarterly operating results and our ability to adjust our operations to address unexpected changes; (8) significant disruption in third-party package delivery and import/export services or significant increases in prices for those services; (9) disruptions in the supply of raw materials and supplies; (10) our ability to retain key personnel; (11) significant disruption in our information technology systems, or cybercrime; (12) our ability to realize the full value of our intangible assets; (13) our failure to adequately protect our intellectual property; (14) the loss of any of our licenses or licensed rights; (15) the manufacture and sale of products exposing us to product liability claims; (16) our failure to maintain compliance with applicable government regulations; (17) regulatory changes; (18) our failure to comply with healthcare industry regulations; (19) economic, political and other risks associated with foreign operations; (20) our ability to obtain future financing; (21) restrictions in our credit agreements; (22) significant fluctuations in our stock price; (23) reduction or elimination of dividends on our common stock; and (24) other factors which we describe under the caption “Risk Factors” in our most recent quarterly report on Form 10-Q and in our other filings with the Securities and Exchange Commission. We disclaim any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this press release.
About Revvity
At Revvity, “impossible” is inspiration, and “can’t be done” is a call to action. Revvity provides health science solutions, technologies, expertise and services that deliver complete workflows from discovery to development, and diagnosis to cure. Revvity is revolutionizing what’s possible in healthcare, with specialized focus areas in translational multi-omics technologies, biomarker identification, imaging, prediction, screening, detection and diagnosis, informatics and more.
With 2022 revenue of more than $3 billion and over 11,000 employees, Revvity serves customers across pharmaceutical and biotech, diagnostic labs, academia and governments. It is part of the S&P 500 index and has customers in more than 190 countries.
Stay updated by following our Newsroom, LinkedIn, X, YouTube, Facebook and Instagram.
Revvity, Inc. and Subsidiaries
CONDENSED CONSOLIDATED INCOME STATEMENTS
Three Months Ended
Nine Months Ended
(In thousands, except per share data)
October 1, 2023
October 2, 2022
October 1, 2023
October 2, 2022
Revenue
$
670,739
$
711,803
$
2,054,670
$
2,570,608
Cost of revenue
298,223
304,759
898,457
1,017,108
Selling, general and administrative expenses
250,249
242,743
765,828
781,189
Research and development expenses
53,039
53,521
166,982
167,081
Operating income from continuing operations
69,228
110,780
223,403
605,230
Interest income
(23,450
)
(667
)
(53,768
)
(2,024
)
Interest expense
25,486
25,931
74,231
81,447
Change in fair value of financial securities
13,587
5,106
12,842
14,321
Other expense (income), net
3,002
(1,732
)
38,501
(1,904
)
Income from continuing operations, before income taxes
50,603
82,142
151,597
513,390
Provision for income taxes
18,134
12,634
35,661
98,211
Income from continuing operations
32,469
69,508
115,936
415,179
(Loss) income from discontinued operations
(22,972
)
15,839
498,595
26,342
Net income
$
9,497
$
85,347
$
614,531
$
441,521
Diluted earnings per share:
Income from continuing operations
$
0.26
$
0.55
$
0.93
$
3.28
(Loss) income from discontinued operations
(0.18
)
0.13
3.98
0.21
Net income
$
0.08
$
0.67
$
4.90
$
3.49
Weighted average diluted shares of common stock outstanding
124,203
126,540
125,335
126,544
ABOVE PREPARED IN ACCORDANCE WITH GAAP
Additional supplemental information (1):
(per share, continuing operations)
GAAP EPS from continuing operations
$
0.26
$
0.55
$
0.93
$
3.28
Amortization of intangible assets
0.73
0.72
2.20
2.22
Debt extinguishment costs
(0.00
)
(0.00
)
(0.03
)
(0.00
)
Purchase accounting adjustments
0.01
0.08
0.02
0.36
Acquisition and divestiture-related costs
0.09
0.07
0.63
0.20
Change in fair value of financial securities
0.11
0.04
0.10
0.11
Significant litigation matters and settlements
–
0.00
–
(0.00
)
Significant environmental matters
–
–
0.01
–
Restructuring and other, net
0.09
0.02
0.13
0.12
Tax on above items
(0.25
)
(0.24
)
(0.73
)
(0.77
)
Significant tax items
0.14
(0.03
)
0.13
(0.03
)
Adjusted EPS from continuing operations
$
1.18
$
1.21
$
3.39
$
5.50
(1) amounts may not sum due to rounding
Revvity, Inc. and Subsidiaries
REVENUE AND OPERATING INCOME (LOSS)
Three Months Ended
Nine Months Ended
(In thousands, except percentages)
October 1, 2023
October 2, 2022
October 1, 2023
October 2, 2022
Adjusted revenue and operating income
Reported revenue
$
670,739
$
711,803
$
2,054,670
$
2,570,608
Revenue purchase accounting adjustments
206
203
618
609
Adjusted revenue
670,945
712,006
2,055,288
2,571,217
Reported operating income from continued operations
69,228
110,780
223,403
605,230
OP%
10.3
%
15.6
%
10.9
%
23.5
%
Amortization of intangible assets
90,920
91,525
275,489
280,469
Purchase accounting adjustments
1,080
9,621
3,057
45,594
Acquisition and divestiture-related costs
12,550
8,475
59,080
25,865
Significant litigation matters and settlements
–
629
–
(632
)
Significant environmental matters
–
–
1,132
–
Restructuring and other, net
10,832
2,774
15,936
15,443
Adjusted operating income
$
184,610
$
223,804
$
578,097
$
971,969
OP%
27.5
%
31.4
%
28.1
%
37.8
%
Segment revenue and segment operating income
Life Sciences
$
307,855
$
312,783
$
972,649
$
945,484
Diagnostics
363,090
399,223
1,082,639
1,625,733
Revenue purchase accounting adjustments
(206
)
(203
)
(618
)
(609
)
Reported revenue
670,739
711,803
2,054,670
2,570,608
Life Sciences
114,192
116,881
371,410
357,661
37.1
%
37.4
%
38.2
%
37.8
%
Diagnostics
81,741
123,428
241,414
668,981
22.5
%
30.9
%
22.3
%
41.1
%
Corporate
(11,323
)
(16,505
)
(34,727
)
(54,673
)
Subtotal reportable segments operating income
184,610
223,804
578,097
971,969
Amortization of intangible assets
(90,920
)
(91,525
)
(275,489
)
(280,469
)
Purchase accounting adjustments
(1,080
)
(9,621
)
(3,057
)
(45,594
)
Acquisition and divestiture-related costs
(12,550
)
(8,475
)
(59,080
)
(25,865
)
Significant litigation matters and settlements
–
(629
)
–
632
Significant environmental matters
–
–
(1,132
)
–
Restructuring and other, net
(10,832
)
(2,774
)
(15,936
)
(15,443
)
Reported operating income from continued operations
$
69,228
$
110,780
$
223,403
$
605,230
REPORTED REVENUE AND REPORTED OPERATING INCOME (LOSS) PREPARED IN ACCORDANCE WITH GAAP
Revvity, Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
October 1, 2023
January 1, 2023
Current assets:
Cash and cash equivalents
$
1,136,721
$
454,358
Marketable securities
292,971
–
Accounts receivable, net
644,574
612,780
Inventories, net
435,696
405,462
Other current assets
403,275
122,254
Current assets of discontinued operations
–
1,693,704
Total current assets
2,913,237
3,288,558
Property, plant and equipment, net
489,747
482,950
Operating lease right-of-use assets
156,143
188,351
Intangible assets, net
3,085,253
3,377,174
Goodwill
6,470,139
6,481,768
Other assets, net
307,029
311,054
Total assets
$
13,421,548
$
14,129,855
Current liabilities:
Current portion of long-term debt
$
727,539
$
470,929
Accounts payable
188,302
272,826
Accrued expenses and other current liabilities
532,004
527,863
Current liabilities of discontinued operations
–
272,865
Total current liabilities
1,447,845
1,544,483
Long-term debt
3,152,454
3,923,347
Long-term liabilities
993,046
1,109,181
Operating lease liabilities
133,922
169,968
Total liabilities
5,727,267
6,746,979
Total stockholders’ equity
7,694,281
7,382,876
Total liabilities and stockholders’ equity
$
13,421,548
$
14,129,855
PREPARED IN ACCORDANCE WITH GAAP
Revvity, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended
Nine Months Ended
October 1, 2023
October 2, 2022
October 1, 2023
October 2, 2022
(In thousands)
(In thousands)
Operating activities:
Net income
$
9,497
$
85,347
$
614,531
$
441,521
Loss (income) from discontinued operations, net of income taxes
22,972
(15,839
)
(498,595
)
(26,342
)
Income from continuing operations
32,469
69,508
115,936
415,179
Adjustments to reconcile income from continuing operations
to net cash provided by (used in) continuing operations:
Stock-based compensation
10,703
10,112
34,229
39,776
Restructuring and other, net
10,832
2,774
15,936
15,443
Depreciation and amortization
108,263
104,735
326,201
322,766
Change in fair value of contingent consideration
633
(2,132
)
1,718
(769
)
Amortization of deferred debt financing costs and accretion of discounts
1,982
2,194
5,800
6,046
Change in fair value of financial securities
13,587
5,106
12,842
14,321
Debt extinguishment income
(77
)
(580
)
(3,422
)
(92
)
Unrealized foreign exchange loss
–
–
23,679
–
Amortization of acquired inventory revaluation
–
11,315
–
45,039
Changes in assets and liabilities which provided (used) cash, excluding
effects from companies acquired:
Accounts receivable, net
(20,697
)
39,803
(30,913
)
120,138
Inventories
(8,059
)
(12,681
)
(34,834
)
(44,475
)
Accounts payable
(36,169
)
(18,308
)
(85,394
)
(27,968
)
Accrued expenses and other
(82,710
)
(89,881
)
(322,995
)
(360,089
)
Net cash provided by (used in) operating activities of continuing operations
30,757
121,965
58,783
545,315
Net cash (used in) provided by operating activities of discontinued operations
(64,242
)
37,987
(164,124
)
(4,663
)
Net cash (used in) provided by operating activities
(33,485
)
159,952
(105,341
)
540,652
Investing activities:
Capital expenditures
(22,357
)
(13,030
)
(57,252
)
(59,502
)
Purchases of investments
(1,000
)
(22,760
)
(6,000
)
(45,010
)
Purchases of US Treasury Securities
–
–
(831,219
)
–
Proceeds from US Treasury Securities
450,000
550,000
Proceeds from notes receivables
–
8,890
–
8,890
Proceeds from disposition of businesses and assets
153
4,610
153
5,664
Cash paid for acquisitions, net of cash, cash equivalents and restricted cash acquired
(1,400
)
(2,133
)
(2,086
)
(7,768
)
Net cash provided by (used in) investing activities of continuing operations
425,396
(24,423
)
(346,404
)
(97,726
)
Net cash provided by (used in) investing activities of discontinued operations
9,473
1,917
2,074,734
(9,441
)
Net cash provided by (used in) investing activities
434,869
(22,506
)
1,728,330
(107,167
)
Financing Activities:
Payments on borrowings
–
–
–
(220,000
)
Proceeds from borrowings
–
–
–
220,000
Payments of term loan
–
(50,000
)
–
(500,000
)
Payments of senior debt
(467,138
)
(7,472
)
(517,973
)
(7,472
)
Payment of debt issuance costs
–
(15
)
Settlement of cash flow hedges
–
–
–
(762
)
Net (payments) proceeds on other credit facilities
(13
)
343
7,218
(482
)
Payments for acquisition-related contingent consideration
–
–
(10,117
)
(5
)
Proceeds from issuance of common stock under stock plans
506
413
3,721
6,254
Purchases of common stock
(110,715
)
(89
)
(384,014
)
(56,137
)
Dividends paid
(8,689
)
(8,835
)
(26,327
)
(26,502
)
Net cash used in financing activities of continuing operations
(586,049
)
(65,640
)
(927,507
)
(585,106
)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
(10,699
)
(17,427
)
(28,270
)
(51,404
)
Net (decrease) increase in cash, cash equivalents, and restricted cash
(195,364
)
54,379
667,212
(203,025
)
Cash, cash equivalents, and restricted cash at beginning of period
1,333,322
361,933
470,746
619,337
Cash, cash equivalents, and restricted cash at end of period
$
1,137,958
$
416,312
$
1,137,958
$
416,312
Supplemental disclosure of cash flow information:
Reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total shown in the consolidated statements of cash flows:
Cash and cash equivalents
$
1,136,721
$
400,741
$
1,136,721
$
400,741
Restricted cash included in other current assets
1,237
284
1,237
284
Restricted cash included in other assets
–
288
–
288
Cash and cash equivalents included in current assets of discontinued operations
–
14,999
–
14,999
Total cash, cash equivalents and restricted cash
$
1,137,958
$
416,312
$
1,137,958
$
416,312
PREPARED IN ACCORDANCE WITH GAAP
Revvity, Inc. and Subsidiaries
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (1)
Revvity
Three Months Ended
October 1, 2023
Organic revenue growth:
Reported revenue growth from continuing operations
-6%
Less: effect of foreign exchange rates
1%
Less: effect of acquisitions including purchase accounting adjustments and impact of divested businesses
0%
Organic revenue growth from continuing operations
-7%
Less: effect of COVID products
-8%
Non-COVID organic revenue growth from continuing operations
1%
Life Sciences
Three Months Ended
October 1, 2023
Organic revenue growth:
Reported revenue growth from continuing operations
-2%
Less: effect of foreign exchange rates
1%
Less: effect of acquisitions including purchase accounting adjustments and impact of divested businesses
0%
Organic revenue growth from continuing operations
-3%
Diagnostics
Three Months Ended
October 1, 2023
Organic revenue growth:
Reported revenue growth from continuing operations
-9%
Less: effect of foreign exchange rates
1%
Less: effect of acquisitions including purchase accounting adjustments and impact of divested businesses
0%
Organic revenue growth from continuing operations
-10%
(1) amounts may not sum due to rounding
Explanation of Non-GAAP Financial Measures
We report our financial results in accordance with GAAP. However, management believes that, in order to more fully understand our short-term and long-term financial and operational trends, investors may wish to consider the impact of certain non-cash, non-recurring or other items, which result from facts and circumstances that vary in frequency and impact on continuing operations. Accordingly, we present non-GAAP financial measures as a supplement to the financial measures we present in accordance with GAAP. These non-GAAP financial measures provide management with additional means to understand and evaluate the operating results and trends in our ongoing business by adjusting for certain non-cash expenses and other items that management believes might otherwise make comparisons of our ongoing business with prior periods more difficult, obscure trends in ongoing operations, or reduce management’s ability to make useful forecasts. Management believes these non-GAAP financial measures provide additional means of evaluating period-over-period operating performance. In addition, management understands that some investors and financial analysts find this information helpful in analyzing our financial and operational performance and comparing this performance to our peers and competitors.
We use the term “adjusted revenue” to refer to GAAP revenue, including purchase accounting adjustments for revenue from contracts acquired in acquisitions that will not be fully recognized due to accounting rules. We use the related term “adjusted revenue growth” to refer to the measure of comparing current period adjusted revenue with the corresponding period of the prior year.
We use the term “organic revenue” to refer to GAAP revenue, excluding the effect of foreign currency changes and revenue from recent acquisitions and divestitures and including purchase accounting adjustments for revenue from contracts acquired in acquisitions that will not be fully recognized due to accounting rules. We use the related term “organic revenue growth” to refer to the measure of comparing current period organic revenue with the corresponding period of the prior year. We use the related term “non-COVID organic revenue growth” to refer to the measure of comparing current period organic revenue excluding revenue from COVID related products and services with the corresponding period of the prior year excluding revenue from COVID related products and services.
We use the term “adjusted gross margin” to refer to GAAP gross margin, excluding amortization of intangible assets and inventory fair value adjustments related to business acquisitions, asset impairments, and including purchase accounting adjustments for revenue from contracts acquired in acquisitions that will not be fully recognized due to business combination accounting rules. We use the related term “adjusted gross margin percentage” to refer to adjusted gross margin as a percentage of adjusted revenue.
We use the term “adjusted SG&A expense” to refer to GAAP SG&A expense, excluding amortization of intangible assets, purchase accounting adjustments, acquisition and divestiture-related expenses, significant litigation matters and settlements, asset impairments, and significant environmental charges.
Contacts
Investor Relations:
Steve Willoughby
[email protected]
Media Contact:
Fara Goldberg (781) 663-5699
[email protected]