Management's Discussion and Analysis
General
On November 11, 1993, the Company's Board of Directors approved
a plan to divest operations of the Company's Instrumentation
Divisions, which served primarily the chromatography and
bioscience markets. These divisions, which represented separate
product lines with separate customers, have been accounted for
as discontinued operations. The Company sold these divisions in
the third quarter of 1994 and realized a net loss upon their
disposition. The consolidated statement of income in 1993
included the results of discontinued operations through November
11, 1993. The following discussion on results of operations
applies to continuing operations.
Results of Operations
Consolidated net sales increased 12 percent in 1994 to $497
million. Sales growth rates, measured both in local currencies
and in U.S. dollars, are summarized in the table below.
Sales growth rates Sales growth rates
measured in local currencies measured in U.S. dollars
1994 1993 1992 1994 1993 1992
Americas 8% 6% (1%) 8% 6% (1%)
Europe 6% 4% 9% 7% (7%) 12%
Asia/Pacific 16% 10% (6%) 21% 18% (2%)
Consolidated 10% 6% 1% 12% 4% 3%
Sales growth, excluding foreign exchange impact, increased to 10
percent in 1994 from 6 percent in 1993. This performance was
led by the electronics/industrial market which grew by 28
percent.
In the Americas, sales growth increased to 8 percent in 1994
from 6 percent in 1993; and in Europe, sales grew 6 percent in
1994 from 4 percent in 1993. Sales in Japan grew 10 percent in
1994 from 2 percent in 1993; while sales in the rest of Asia
increased by 53 percent.
Electronics/industrial was the strongest market in each
geography, with particular impact in Korea and Japan. Sales to
the pharmaceutical/biotechnology market grew more slowly in 1994
due to reduced spending by pharmaceutical customers in the
Americas and to a recessionary economy and a more difficult
regulatory environment in Europe and Japan. The lab/research
market showed sales growth in the Americas, Europe and Japan,
and was particularly strong in Asia. Laboratory water products
also grew across all geographies, with strongest performance in
Europe and Japan.
The effect of foreign exchange rates on sales was 2 percent
favorable in 1994, compared to 2 percent unfavorable in 1993 and
2 percent favorable in 1992. A weaker dollar will benefit, and
a stronger dollar will affect adversely, future operations.
However, the Company is unable to predict future currency
fluctuations and to quantify their effect on income. Price
changes and inflation have not significantly affected the
comparability of sales during the past three years.
Gross Margins were 57.2 percent in 1994, 56.5 percent in 1993,
and 54.2 percent in 1992. Excluding the charges for EPA
settlements and the accrual of costs associated with increasing
the efficiency of our manufacturing operations in 1992, margins
in 1992 were 56.3 percent. The improvement in margins in 1994
as compared to 1993 and 1992 resulted from significantly
increased production volume in the Company's
electronics/industrial plants as well as continued cost
reduction activities in all of the Company's manufacturing
operations.
Selling, General and Administrative (S,G&A) expenses, excluding
the effects of foreign exchange, grew 8 percent in 1994, 6
percent in 1993 and 10 percent in 1992. S,G&A spending was
higher in the second half of 1994 than in the first half as the
Company invested in sales and marketing programs to support
future sales growth.
Research and Development Expenses decreased slightly in 1994
compared to a 6 percent increase in 1993 and a marginal increase
in 1992. The Company continued to fund all major programs in
1994.
Other Expense in 1994 reflects a non-recurring charge of $10.8
million to settle litigation which arose from the Company's sale
of its Process Water Division in 1989. The litigation was
settled in the fourth quarter of 1994. Other expense in 1992
reflects the loss taken on the sale of the Company's
environmental testing business Resource Analysts, Inc. (RAI), in
1992.
Net Interest Expense in 1994 was significantly lower than in
1993 and 1992, primarily due to interest earned on the net
proceeds received from the divested businesses; a lower interest
rate on the refinanced $100 million long-term note; and an
overall lower level of net short-term borrowings.
The Provision for Income Taxes was 22.5 percent of pre-tax
income in 1994, the same effective rate as in 1993 and 1992.
The Company continues to benefit from low tax rates in Puerto
Rico and Ireland and tax incentives attributable to its U.S.
export operations.
25
The Net Loss on Disposal of Discontinued Operations reflects the
after-tax loss of the disposition of the Company's
Instrumentation Divisions, which were concluded in the third
quarter of 1994.
Extraordinary Loss on Early Extinguishment of Debt reflects the
after-tax cost recorded by the Company in the fourth quarter of
1993 to pre-pay its $100 million note, which bore interest at
9.2 percent and was callable in 1995. In March 1994, the Company
issued and sold a new $100 million note bearing interest at 6.78
percent.
Earnings Per Share for the past three years include a number of
charges resulting from either specific transactions or adoption
of new accounting pronouncements. Earnings per share from
continuing operations adjusted for these events are summarized
as follows:
1994 1993 1992
Earnings from continuing
operations after accounting
changes and charges $2.18 $1.62 $1.07
SFAS #106 Charges - cumulative
impact - - .19
Charges .30 .13 .34
Earnings from continuing
operations before accounting
changes and charges $2.48 $1.75 $1.60
The charge in 1994 resulted from the settlement of litigation
relating to the Company's sale of the its Process Water Division
in 1989. The charge in 1993 resulted from the early
extinguishment of the Company's long-term debt. The charges in
1992 resulted from providing for the settlement of all known
environmental disputes with the Environmental Protection Agency
(EPA), the sale of Resource Analysts, Inc., and an additional
charge taken to cover costs of increasing the efficiencies of
the Company's manufacturing operations.
Legal Proceedings
The potential settlement amount of all environmental claims
against all participants at hazardous waste ("Superfund") sites
in which the Company has been named a potentially responsible
party by the EPA is significant. It is unlikely, however, that
the Company's share of these costs will have a material impact
on the financial condition of the Company. The Company is only
one of many potentially responsible parties named at each site.
Additionally, in certain instances the Company believes that its
insurance will cover a portion of the costs incurred. In 1992,
the EPA unexpectedly proposed settlements for several of these
sites. Based on these proposed settlements and all other
information available to management, the Company recorded a
provision of $5.8 million in cost of sales in 1992, which, in
management's best estimate, will be sufficient to satisfy all
known claims by the EPA. No individual settlement to date has
had a material impact on the Company's financial condition.
Capital Resources and Liquidity
In 1994, the Company generated $49 million of cash from
continuing operations, compared to generating $34 million in
1993 and expending $14 million in 1992. Cash provided by
operations continues to be the Company's primary source of
funding working capital requirements. In addition to the
increase in net income from continuing operations of $14.1
million in 1994 as compared to 1993, the Company received a tax
refund of $14.0 million in 1994. These sources of cash were
partially offset by an increase in accounts receivable of $14.7
million in 1994 compared to an increase of $5.4 million in 1993.
In addition, inventories increased $1.9 million in 1994 compared
to a decrease of $6.4 million in 1993. Capital expenditures by
continuing operations were lower in 1994 than in 1993 and 1992
as the Company spent less on facility expansions and information
technology systems. The Company expects capital expenditures in
1995 to be in line with capital spending in 1994 and 1993. At
December 31, 1994, the Company had no significant commitments
for capital expenditures.
In 1994, the Company paid a total of $15.4 million in non-
recurring financing- related transactions; $5.1 million was used
to pre-pay the Company's $100 million notes payable due in 1998,
while $10.3 million was used to close out the Company's yen
currency swap. In addition, the Company had $258 million of net
proceeds from the sale of its Waters Chromatography and
Bioscience divisions in 1994. The Company spent $293 million,
net of stock option receipts, to repurchase 6.1 million shares
of its common stock in 1994, primarily pursuant to a Dutch
Auction Self Tender completed in the third quarter and an
ongoing open market share repurchase program. In the fourth
quarter of 1994, the Company announced a $100 million open
market share repurchase program and spent $78 million in share
repurchases. In early 1995, the Company announced plans to
spend an additional $50 million on open market share
repurchases.
The Company has $30.2 million of cash and short-term investments
on hand at the end of 1994 which, along with the Company's
strong financial position, provides a high degree of flexibility
in financing future requirements.
Dividends
The quarterly dividend was increased in the second quarter of
1994 from $0.14 to $0.15 per share. Dividends paid in 1994 were
$15.8 million.
26
Consolidated Statements of Income
Millipore Corporation
Year ended December 31
(In thousands except per share data) 1994 1993 1992
Net sales $ 497,252 $ 445,366 $ 427,188
Cost of sales 212,675 193,575 195,462
Gross profit 284,577 251,791 231,726
Selling, general and
administrative expenses 159,591 145,647 142,701
Research and development expenses 34,327 34,952 32,953
Operating income 90,659 71,192 56,072
Other expense (10,800) - (2,415)
Interest income 4,091 4,069 6,888
Interest expense (7,035) (12,038) (14,692)
Income from continuing
operations before income taxes 76,915 63,223 45,853
Provision for income taxes 17,306 14,225 10,317
Income from continuing operations before
extraordinary item and cumulative effect of
change in accounting principle 59,609 48,998 35,536
Earnings (loss) from discontinued operations - (10,851) 2,715
Net loss on disposal of discontinued
operations (3,400) - -
Income before extraordinary item and
cumulative effect of change in accounting
principle 56,209 38,147 38,251
Extraordinary item - loss on early
extinguishment of debt - 3,544 -
Cumulative effect of change in accounting
for postretirement benefits other
than pensions - - 5,068
Net income $ 56,209 $ 34,603 $ 33,183
Income per share
Income from continuing operations$ 2.18 $ 1.75 $ 1.26
Net income per common share $ 2.05 $ 1.24 $ 1.17
Weighted average common shares
outstanding 27,363 27,951 28,242
27
Consolidated Balance Sheets
Millipore Corporation
December 31
(In thousands) 1994 1993
Assets
Current assets:
Cash $2,898 $2,140
Short-term investments 27,338 38,502
Accounts receivable (less allowance for doubtful accounts of
$4,968 in 1994 and $3,063 in 1993) 136,944 113,795
Inventories 71,209 65,187
Other current assets 5,351 12,790
Receivables arising from sale of businesses 15,064 -
Net current assets of discontinued operations - 138,687
Total current assets 258,804 371,101
Property, plant and equipment, net 187,525 194,895
Intangible assets (less accumulated amortization of $1,597 in 1994
and $1,169 in 1993) 5,177 2,769
Deferred income taxes 58,123 40,792
Other assets 18,024 11,349
Net long-term assets of discontinued operations - 99,647
Total assets $527,653 $720,553
Liabilities and Shareholders' Equity
Current liabilities:
Notes payable and current portion of long-term debt $ 56,289 $ 65,560
Accounts payable and accrued expenses 63,860 57,505
Accrued divestiture costs 16,470 -
Dividends payable 3,500 3,921
Accrued retirement plan contributions 5,987 6,356
Accrued and deferred income taxes payable 12,049 4,894
Total current liabilities 158,155 138,236
Long-term debt 100,231 102,047
Other liabilities 18,990 19,116
Accrued divestiture costs 29,000 -
Commitments and contingent liabilities - -
Shareholders' equity:
Common stock, par value $1.00 per share, 80,000 shares
authorized. 28,494 and 28,344 shares issued as of
December 31, 1994 and 1993, respectively 28,494 28,344
Additional paid-in capital 23,603 16,803
Retained earnings 458,579 434,988
Translation adjustments 5,147 (7,624)
515,823 472,511
Less: Treasury stock at cost, 5,361 and 341 shares as of
December 31, 1994 and 1993, respectively (294,546) (11,357)
Total shareholders' equity 221,277 461,154
Total liabilities and shareholders' equity $527,653 $720,553
Consolidated Statements of Shareholders' Equity
28
Millipore Corporation
Year ended December 31, 1992, 1993 and 1994
(In thousands)
Additional Total
Common Stock Paid-in Retained Translation Treasury Stock Shareholders'
Shares Par Value Capital Earnings Adjustments Shares Cost Equity
Balance at January 1, 1992 28,344 $28,344 $15,743 $398,643 $21,766 0 $0 $464,496
Net income 33,183 33,183
Cash dividends declared, $0.51 per share (14,376) (14,376)
Treasury stock acquired (484) (16,777) (16,777)
Stock options exercised (889) 111 4,033 3,144
Employees' stock purchase plan proceeds 2 3 120 122
U.S. tax benefit from stock
plan activity 781 781
Translation adjustments (17,738) (17,738)
Balance at December 31, 1992 28,344 $28,344 $16,524 $416,563 $4,028 (370) $(12,624) $452,835
Net income 34,603 34,603
Cash dividends declared, $0.55 per share (15,396) (15,396)
Treasury stock acquired (112) (3,427) (3,427)
Stock options exercised (899) 104 3,468 2,569
Employees' stock purchase plan proceeds (32) 10 353 321
Incentive plan awards 161 22 721 882
Stock Awards (12) 5 152 140
U.S. tax benefit from
stock plan activity 279 279
Translation adjustments (11,652) (11,652)
Balance at December 31, 1993 28,344 $28,344 $16,803 $434,988 $(7,624) (341) $(11,357) $461,154
Net income 56,209 56,209
Cash dividends declared, $0.59 per share (15,381) (15,381)
Treasury stock acquired (400) (6,148) (334,702) (335,102)
Stock options exercised 101 101 4,848 (15,479) 1,072 48,898 38,368
Employees' stock purchase
plan proceeds 49 49 2,352 (1,712) 47 2,120 2,809
Incentive plan awards (54) 8 431 377
Stock Awards 8 1 64 72
Translation adjustments 12,771 12,771
Balance at December 31, 1994 28,494 $28,494 $23,603 $458,579 $5,147 (5,361)$(294,546) $221,277
29
Consolidated Statements of Cash Flows
Millipore Corporation
Year ended December 31
(In thousands) 1994 1993 1992
Cash Flows From Operating Activities:
Net income $56,209 $34,603 $33,183
Adjustments to reconcile net income to net cash provided by
continuing operations
Net loss (income) from discontinued operations - 10,851 (2,715)
Net loss on disposal of discontinued operations3,400 - -
Depreciation and amortization 27,604 23,775 23,507
Deferred income tax provision (2,227) (1,745) 225
Extraordinary item-loss on extinguishment of debt - 3,544 -
Change in operating assets and liabilities:
(Increase) decrease in accounts receivable (14,672) (5,440) 8,348
(Increase) decrease in inventories (1,894) 6,398 (8,269)
Decrease in other current assets 1,427 763 1,276
(Increase) in other assets (3,413) (1,981) (16,003)
Increase (decrease) in accounts payable
and accrued expenses 2,876 3,740 (2,475)
(Decrease) increase in accrued retirement plan
contributions (269) (104) 600
Increase (decrease) in accrued income taxes 6,123 (1,002) (2,111)
Income tax refund received 14,035 - -
Other (3,334) 53 11,898
Net cash provided by continuing operations 85,865 73,455 47,464
Net cash provided by discontinued operations - 8,708 4,691
Net cash provided by operating activities 85,865 82,163 52,155
Cash Flows From Investing Activities:
Net proceeds from sales of businesses 257,899 - -
Additions to property, plant and equipment, ne t (21,009) (24,469) (33,906)
Net investing activities of discontinued businesses - (9,357) (11,018)
Net cash provided by (used in) investing
activities 236,890 (33,826) (44,924)
Cash Flows From Financing Activities:
Treasury stock acquired (334,702) (3,427) (16,777)
Issuance of treasury stock under stock plans 33,876 3,912 3,266
Cash paid to extinguish long-term debt (5,088) - -
Common stock issued 7,350 - -
Cash paid to close out foreign currency swap (10,287) - -
Net change in short-term debt (9,539) (59,887) 20,137
Net change in long-term debt (1,820) (1,222) (2,988)
Dividends paid (15,802 (15,108) (14,093)
Net cash used for financing activities (336,012) (75,732) (10,455)
Effect of foreign exchange rates on cash and
short-term investments 2,851 (2,414) (2,765)
Net decrease in cash and short-term investments (10,406) (29,809) (5,989)
Cash and short-term investments on January 1 40,642 70,451 76,440
Cash and short-term investments on
December 31 $ 30,236 $ 40,642 $ 70,451
30
Notes to Consolidated Financial Statements (In thousands except per
share data)
Note A - Summary of Significant Accounting Policies
Principles of Consolidation
The consolidated financial statements include the accounts of the Company
and its subsidiaries, all of which are wholly owned. All material
intercompany balances and transactions have been eliminated.
Translation of Foreign Currencies
For all of the Company's foreign subsidiaries, except Brazil, assets and
liabilities are translated at exchange rates prevailing on the balance sheet
date, revenues and expenses are translated at average exchange rates
prevailing during the period, and elements of shareholders' equity are
translated at historical rates. Any resulting translation gains and losses
are reported separately in shareholders' equity. For the Company's
subsidiary in Brazil, where inflation is very high, the translation is the
same except that inventories, cost of sales, property, plant and equipment,
and depreciation are translated at historical rates. Resulting translation
gains and losses for this subsidiary are included in income. Net losses
from foreign currency transactions and translations of $644 in 1994, $867 in
1993, and $1,767 in 1992 were included in selling, general and
administrative expenses.
Short-term Investments
Short-term investments consist primarily of government securities and
certificates of deposit and are carried at cost plus accrued interest, which
approximates market value.
Inventories
The Company values all of its inventories manufactured in the United States
at the lower of cost or market, principally on a last-in, first-out (LIFO)
basis. Inventories manufactured outside of the United States are valued on a
first-in, first-out (FIFO) basis.
Property, Plant and Equipment
Property, plant and equipment is recorded at cost. Expenditures for
maintenance and repairs are charged to expense while the costs of
significant improvements are capitalized. Depreciation on assets acquired
before January 1, 1989 generally is provided using accelerated methods over
the estimated useful lives of the assets. Assets acquired after January 1,
1989 primarily are depreciated using straight-line methods. Upon retirement
or sale, the cost of assets disposed and the related accumulated
depreciation are eliminated and related gains or losses reflected in income.
Intangible Assets
Intangible assets consist primarily of goodwill and licenses. Intangible
assets are amortized on a straight-line basis over appropriate periods not
exceeding 15 years.
Income Taxes
In 1992, the Company adopted the provisions of SFAS #109 "Accounting for
Income Taxes". As discussed more fully in Note H, deferred income taxes
under SFAS #109 are determined on the liability method. The Company
provides deferred income taxes only on the unremitted earnings of foreign
and Puerto Rican subsidiaries which are expected to be repatriated.
Treasury Stock
Treasury stock is recorded at its cost on the date acquired and is relieved
at its weighted average cost upon reissuance. The excess of the cost over
proceeds of treasury stock reissued is charged to retained earnings.
Net Income Per Common Share
Net income per common share is calculated by dividing the net income for the
period by the weighted average number of common shares outstanding for the
period.
Postretirement Benefits Other Than Pensions
In 1992, the Company adopted the provisions of SFAS #106 "Employers'
Accounting for Postretirement Benefits Other than Pensions". This new
standard, discussed more fully in Note L requires that the expected cost of
retiree health benefits be expensed during the years employees render
service rather than the Company's prior practice of recognizing these costs
on a cash basis.
Revenue Recognition
Sales of products and services are recorded based on product shipment or
performance of services.
Reclassifications
Certain reclassifications have been made to prior years' financial
statements to conform with the 1994 presentation.
31
Note B - Discontinued Operations
On November 11, 1993, the Company's Board of Directors approved a plan to
divest operations of the Company's Instrumentation Divisions, which served
primarily chromatography and bioscience markets. Accordingly, the operating
results of these businesses through November 11, 1993 have been reclassified
as discontinued operations in the accompanying consolidated financial
statements. The operating results of these businesses subsequent to
November 11, 1993 were deferred until the divestitures were completed. The
results of the discontinued operations included in the accompanying
consolidated statements of income are summarized as follows:
1993 1992
through
11/11/93
Net sales $279,303 $349,813
Pre-tax income (loss) $(14,001) $5,632
Provision (credit)
for income taxes (3,150) 1,267
Cumulative effect of change
in accounting for post-
retirement benefits - 1,650
Net income (loss) $ (10,851) $ 2,715
Earnings (loss) per share $ (0.38) $ 0.10
The operating results for 1993 are for the period ended November 11, 1993,
the date the divestiture plan was approved. In the first quarter of 1993,
the Company recorded a restructuring charge of $13,000 to cover costs
associated with reorganizing and restructuring the Company's chromatography
division into more market-focused customer-oriented business units. The
restructuring charge covered the cost of severance and other personnel-
related items resulting from the reorganization.
On August 18, 1994, the Company sold its Waters Chromatography Division to
Waters Holdings, Inc. for $330,000 in cash and $10,000 in stock. On August
23, 1994, the Company sold certain assets of its non-membrane bioscience
business to PerSeptive BioSystems, Inc. for $10,000 in cash and four
thousand shares of preferred stock redeemable in four equal annual
installments of $10,000. The stock proceeds received from each sale have
been recorded at their fair value at the date of receipt. Both sales were
recorded in the third quarter of 1994 and resulted in a combined pre-tax
loss of $5,667 ($3,400 or $0.13 per share net of income taxes) which
included estimated costs to be incurred in connection with the divestitures
as well as pre-tax operating losses of $4,189 generated by the
Instrumentation Divisions from November 11, 1993 through the completion of
the divestitures.
The Company received approximately $258,000 in cash proceeds from the
disposition after related expenses in 1994. In accordance with each
respective sales agreement, the Company retained and will collect certain
customer accounts receivable balances generated by sales of Instrumentation
Division products prior to the completion of the divestitures; such
balances were applied against the cash proceeds specified in the sales
agreements. These amounts have been classified in Receivables arising from
sales of businesses in the accompanying consolidated balance sheets.
Note B - Discontinued Operations (continued)
Accruals associated with the divestitures consist primarily of costs to be
incurred in providing future general and administrative support services for
the divested businesses as specified in the sales agreements, costs
associated with abandoning facilities operated under long-term leases, and
employee costs. These accruals have been separately classified in both
current and long-term liabilities in the consolidated balance sheets based
on management's estimates of when such liabilities will be settled.
Net current and long-term assets of discontinued operations as of December
31, 1993 consisted primarily of accounts receivable, inventory, property,
plant and equipment, intangibles, and accounts payable, and were classified
separately in the accompanying consolidated balance sheets.
Note C - Inventories
Inventories at December 31 consisted of the following:
1994 1993
Raw materials $ 19,895 $ 18,782
Work in process 8,992 7,852
Finished goods 42,322 38,553
$ 71,209 $ 65,187
The value of inventories determined using the LIFO cost method was $45,473
or 64 percent of the total at December 31, 1994 and $47,097 or 72 percent of
the total at December 31, 1993. If these inventories had been valued using
the FIFO cost method, they would have been $46,776 at December 31, 1994 and
$48,847 at December 31, 1993.
32
Note D - Property, Plant and Equipment
Property, plant and equipment at December 31 consisted of the
following:
1994 1993
Land $ 7,445 $ 6,966
Leasehold improvements 9,054 16,108
Buildings and improvements 113,359 108,054
Production and other equipment 206,261 206,207
Construction in progress 16,442 20,631
352,561 357,966
Less: accumulated depreciation and
amortization 165,036 163,071
$ 187,525 $ 194,895
Note E - Notes Payable and Current Portion of Long-term Debt
Short-term borrowings and related lines of credit at December 31 are
summarized as follows:
1994 1993
Notes payable and current portion of
long-term debt:
Notes payable $ 56,116 $ 64,942
Current portion of long-term debt 173 618
$ 56,289 $ 65,560
Unused lines of credit $174,409 $240,755
Average amount outstanding at month-end
during the year $46,340 $109,477
Maximum month-end amount outstanding
during the year $74,672 $135,887
Weighted average interest rate
during the year 4.2% 4.3%
Weighted average interest rate at year-end 5.5% 4.5%
Notes payable generally consist of renewable, uncollateralized
borrowings under lines of credit that are denominated in various
currencies and bear interest at prevailing rates.
Note F - Long-term Debt
Long-term debt at December 31 consisted of the following:
1994 1993
Notes payable due in 2004 $100,000 $100,000
Other notes payable with average interest of 11.2% in
1994 and 5.9% in 1993, due through 1997 404 2,665
100,404 102,665
Less: Current portion (173) (618)
Long-term debt $100,231 $102,047
In the fourth quarter of 1993, the Company entered into an
agreement to retire its 9.2 percent $100,000 notes payable
before their call date of March 30, 1995. Accordingly, the
Company recorded an extraordinary charge of $5,906 ($3,544 net
of income taxes or $0.13 per share) in December, 1993 to
reflect the cost of extinguishing the notes. In March, 1994,
the Company issued $100,000 of 6.78 percent notes due in 2004.
Interest is payable semi-annually on these notes in March and
September.
Long-term debt, including current portion, matures as follows:
Year ended December 31, 1995 $ 173
Year ended December 31, 1996 160
Year ended December 31, 1997 71
Year ended December 31, 1998 0
Year ended December 31, 1999 0
Years subsequent to December 31, 1999 $ 100,000
Certain notes contain covenants relating to maintenance
of current asset levels, cash dividends and limitations on
long-term debt. The Company is in compliance with all such
covenants.
The Company capitalized interest costs associated with
the construction of certain assets of $890 in 1994, $1,301 in
1993, and $1,561 in 1992. Interest paid on debt during 1994,
1993, and 1992 amounted to $8,946, $13,356, and $16,637,
respectively.
33
As of December 31, 1993, the Company had partially hedged
its foreign currency net asset exposure by entering into a
currency swap which was to mature in 1995. Under the terms of
the original swap, the Company exchanged $100,000 of dollar
debt service obligations for foreign obligations of 9,936,000
yen and 33,193 DM. In January, 1994, the Company closed out
the yen-denominated swap and simultaneously exchanged $80,000
of dollar debt service obligations for a yen denominated
obligation of 8,760,000 yen, which bears interest at a rate of
4.49 percent. This swap matures in 2004. The Company's
foreign currency obligations had effective weighted average
interest rates of 5.18 and 6.02 percent in 1994 and 1993
respectively. The effects of foreign currency exchange rate
fluctuations resulting from these swap agreements are included
in translation adjustments and in transaction gains/losses.
Unrealized losses on these swap agreements of $9,327 at
December 31, 1994 and $8,020 at December 31, 1993 are included
in other assets in the consolidated balance sheets.
Note G - Foreign Exchange
In the fourth quarter of 1993, the Company entered into
forward exchange contracts to reduce the impact of foreign
currency fluctuations on certain transactions in 1994. A loss
of $960 was realized on these contracts and was recorded in
cost of sales in 1994. During 1994, the Company has again
entered into forward exchange contracts to reduce the impact
of foreign currency fluctuations on certain transactions. The
gains or losses on these contracts will be included in income
when the operating revenues and expenses related to the
underlying transactions are recognized. Contracts open at
December 31, 1994, aggregating $26,000, have an unrealized
loss of $467. All open contracts have maturities which do not
exceed fifteen months.
Note H - Income Taxes
The Company has provided for income taxes on both
continuing and discontinued operations according to the
provisions of SFAS #109 "Accounting for Income Taxes" which
the Company adopted in 1992. Data related to the provisions
for income taxes are summarized as follows:
1994 1993 1992
Domestic and foreign income before income taxes:
Domestic $23,042 $16,690 $27,077
Foreign 48,206 32,532 24,408
71,248 49,222 51,485
Less: (Income) loss from discontinued
operations - 14,001 (5,632)
loss on disposal of discontinued
operations 5,667 - -
Income from continuing operations before
income taxes $76,915 $63,223 $45,853
Domestic and foreign provisions for income taxes:
Domestic $(1,894) $(2,781) $ 2,842
Foreign 16,433 13,356 8,242
State 500 500 500
15,039 11,075 11,584
Less: portion applied to discontinued
operations 2,267 3,150 (1,267)
$17,306 $14,225 $10,317
Current and deferred provisions for income taxes:
Current $28,800 $12,820 $11,359
Deferred (13,761) (1,745) 225
$15,039 $11,075 $11,584
Summary of the differences between the Company's consolidated
effective tax rate and the United States statutory federal
income tax rate:
U.S. statutory income tax rate 35.0% 35.0% 34.0%
Puerto Rico tax rate benefits (6.0) (11.9) (9.8)
Ireland tax rate benefits (4.0) (1.1) (1.7)
Excess foreign over U.S. tax rate - 5.6 -
State income tax, net of federal income tax
benefit .5 .7 .6
Foreign Sales Corporation income
not taxed (3.0) (4.6) (4.1)
Other - (1.2) 3.5
Effective tax rate applicable to
operations 22.5% 22.5% 22.5%
34
Net deferred tax assets result from temporary differences in
the recognition of revenues and expenses for financial
statement and income tax purposes. Components of the net
deferred tax assets are as follows:
1994 1993
Intercompany and inventory
related transaction $6,861 $18,698
Postretirement benefits other
than pensions 3,271 4,435
Tax credits (including foreign tax
credits on unremitted earnings) 33,056 21,800
Divestiture related costs 30,850 -
U.S. net operating loss
carryforwards - 14,001
Other, net 3,475 1,248
77,513 60,182
Valuation allowance (19,390) (19,390)
Net deferred tax asset $ 58,123 $ 40,792
The valuation allowance is provided primarily against foreign
tax credits which can be utilized against future taxable
income in the United States after the utilization of other
carryforwards and expire no later than 1996.
The reduction in tax expense attributable to tax exemptions on
the Company's operations in Puerto Rico was $3,673 in 1994,
$5,843 in 1993, and $5,035 in 1992 or $0.13, $0.21, and $0.18,
per share, respectively. Tax exemptions relating to these
operations are effective through 2004. Income taxes paid
during 1994, 1993, and 1992 were $25,296, $15,185, and $18,634
respectively.
During 1994 the Internal Revenue Service ("IRS") completed its
examination of the Company's federal income tax returns
pertaining to its U.S. and Puerto Rican operations for the
years 1985-1990.
Note I - Legal Proceedings
The Company has been notified in a number of instances that
the United States Environmental Protection Agency (EPA) has
determined that a release or a substantial threat of a release
of hazardous substances (Release) as defined in Section 101 of
the Comprehensive Environmental Response Compensation and
Liability Act of 1980 as amended by the Superfund Amendments
and Reauthorization Act of 1986 (the so-called "Superfund"
law) has occurred at certain sites to which chemical wastes
generated by the manufacturing operations of the Company have
been sent. These notifications typically also allege that the
Company may be a potentially responsible party under the law
with respect to any remedial action needed to control or
prevent any such Release. Under the law the EPA may undertake
remedial action and responsible parties may be liable, without
regard to fault or negligence, for all costs incurred. In
several of these instances the EPA has issued a proposal for
remedial action it considers necessary to protect the
environment. In each instance the Company was only one of a
large number of corporations and entities which received such
notification, and anticipates that any ultimate liability for
remedial costs will be shared by others. In 1992, the EPA
unexpectedly proposed settlements for several of these sites.
Based on those proposed settlements and all other information
available to management, the Company recorded a provision of
$5,800 in cost of sales which, in management's best estimate
will be sufficient to satisfy all known claims by the EPA.
The Company has paid a total of $14,028 to date to satisfy
environmental claims. The aggregate of further potential
liabilities is not expected to have a material adverse effect
on the Company's financial condition.
Eastern Enterprises filed a lawsuit against the Company
alleging misrepresentations made in connection with its 1989
purchase of the Company's Process Water Division. This
lawsuit was settled in the fourth quarter of 1994 at a total
cost of $10,800, which included a $9,000 payment to Eastern
Enterprises and $1,800 of related costs incurred by the
Company. The cost of settlement is included in Other expense
in the accompanying consolidated statement of income.
Note J - Leases
Lease agreements cover sales offices, warehouse space,
computers and automobiles. These leases have expiration dates
through 2006. Certain land and building leases contain
renewal options for periods ranging from five to ten years and
purchase options at fair market value. Rental expense was
$8,545 in 1994, $10,878 in 1993, and $8,880 in 1992. At
December 31, 1994 future minimum rents payable under
noncancelable leases with initial terms exceeding one year
were as follows:
1995 $7,642
1996 6,588
1997 5,350
1998 3,685
1999 2,634
2000 - 2006 12,533
35
Note K - Stock Plans
Stock Option Plan
Under the Company's Combined Stock Option Plan, stock options
to purchase Millipore common stock may be granted to
employees. The plan provides that the option price per share
may not be less than the fair market value of the stock at the
time the option is granted and that options must expire not
later than 10 years from the date of grant. Plan data are
summarized as follows:
1994 1993 1992
Option shares:
Outstanding at beginning of period 2,720 2,431 2,207
Issued during period 267 516 510
Exercised during period (1,167) (100) (111)
Canceled during period (61) (127) (175)
Outstanding at end of period 1,759 2,720 2,431
Exercisable at end of period 1,044 1,536 1,254
Shares available for granting of options at end of
period 672 879 270
Average price of outstanding options
at end of period $35.92 $33.34 $32.70
Average price of exercised options
during the period $32.60 $24.51 $28.22
Non-Employee Director Stock Option Plan
In 1990, a stock option plan for Non-Employee Directors was
approved by the Company's shareholders. Under this plan,
stock options to purchase up to 100 shares of Millipore common
stock may be granted to non-employee directors of the Company.
The plan provides that the option price per share may not be
less then the fair market value of the stock at the time the
option is granted. At December 31, 1994, 63 options have been
issued and 52 are outstanding.
Employees' Stock Purchase Plan
Under the Company's Employees' Stock Purchase Plan, all
employees of the Company and its subsidiaries who have 90 days
continuous service prior to the beginning of the plan year,
May 1, may purchase shares of Millipore common stock by
payroll deduction. The purchase price per share during the
plan year is the lesser of the fair market value of the common
stock at the time of purchase or on May 1.
In 1994, 1993, and 1992 shares issued under the plan were
96, 10, and 3, respectively. As of December 31, 1994, 21
shares of Millipore common stock were available for sale to
employees under the plan.
Incentive Plan for Senior Management
Under this plan, Millipore common stock is awarded to key members of senior
management at no cost to them. The stock cannot be sold, assigned,
transferred or pledged during a restriction period which is normally four
years. Shares are subject to forfeiture should employment terminate during
the restriction period.
The stock issued under the plan is recorded at its fair market value on the
award date; the related deferred compensation is amortized to selling,
general and administrative expenses over the restriction period. At the end
of 1994, 1993, and 1992, 77, 133, and 114 shares, respectively, were
outstanding under the plan. Plan expense was $790 in 1994, $833 in 1993,
and $924 in 1992. As of December 31, 1994, 70 shares of Millipore common
stock were available for future awards under this plan.
Note L - Employee Retirement Plans
Participation and Savings Plan
The Millipore Corporation Employees' Participation and Savings Plan
(Participation and Savings Plan), maintained for the benefit of all full-
time U.S. employees, combines both a defined contribution plan
(Participation Plan) and an employee savings plan (Savings Plan).
Contributions to the Participation Plan are allocated among the U.S.
employees of the Company who have completed at least two years of continuous
service on the basis of the compensation they received during the year for
which the contribution is made. The Savings Plan allows employees with one
year of continuous service to make certain tax-deferred voluntary
contributions which the company matches with a 25 percent contribution (50
percent contribution for employees with 10 years of service). Total expense
under the Participation and Savings Plan was $6,089 in 1994, $8,679 in 1993,
and $8,520 in 1992.
Retirement Plan
The Company's Retirement Plan for Employees of Millipore Corporation
(Retirement Plan) is a defined benefit plan for all U.S. employees which
provides benefits to the extent that assets of the Participation Plan,
described above, do not provide guaranteed retirement income levels.
36
Guaranteed retirement income levels are determined based on years of service
and salary level as integrated with Social Security benefits. Employees are
eligible under the Retirement Plan after one year of continuous service and
are vested after 5 years of service. For accounting purposes, the Company
uses the projected unit credit method of actuarial valuation. The actuarial
method for funding purposes is the entry age normal method. The Company
contributes annually to the Retirement Plan, subject to Internal Revenue
Service and ERISA funding limitations. No contributions were required for
1994 and 1993.
The following table summarizes the funded status of the plan and amounts
reflected in the Company's consolidated balance sheets at December 31. The
projected benefit obligation was calculated using discount and investment
return rates of 8.5 and 8.0 percent, respectively, in 1994 and 7.5 percent
in 1993, and a salary progression rate of 6 percent in both years. Plan
assets are invested primarily in common stock, mutual funds and money market
funds.
The Company recognized a curailment loss of $91 in the third quarter of 1994
as a result of its divestitures. Such amount was included as part of the
net loss on disposal of discontinued operations.
1994 1993
Actuarial present value of benefit obligations:
Accumulated benefit obligation, including
vested benefits of $2,761 on December 31, 1994 and
$2,804 on December 31, 1993 $ 2,911 $ 2,983
Projected benefit obligation for service
rendered to date $(4,076) $(5,003)
Plan assets at fair value 5,436 5,663
Plan assets in excess of projected benefit
obligation 1,360 660
Unrecognized net actuarial loss 2,772 3,069
Unrecognized prior service cost 132 413
Unrecognized net asset being amortized over
16.7 years (663) (747)
Prepaid pension cost included in financial
statements $ 3,601 $3,395
Net pension income includes the following components
Service cost $ 376 $ 393
Interest cost (361) (358)
Return on plan assets 36 430
Amortization and deferral 246 (131)
Net pension income $ 297 $ 334
Postretirement Benefits Other Than Pensions
The Company sponsors several unfunded defined benefit postretirement plans
covering all U.S. employees. The plans provide medical and life insurance
benefits and are, depending on the plan; either contributory or non-
contributory. As discussed in Note A, the Company adopted the provisions of
SFAS #106 "Employers' Accounting for Postretirement Benefits Other Than
Pensions" effective January 1, 1992. In adopting this standard, the Company
recorded in the final quarter of 1992 a one-time, non-cash charge againsst
earnings from continuing operations of $7,678 before taxes and $5,068 after
taxes, or $0.19 per share.
The Company recognized $4,007 as a settlement in the third quarter of 1994
as a result of its divestitures. The settlement was included as part of the
net loss on disposal of discontinued operations.
Net periodic postretirement benefit cost included the following components:
1994 1993
Service cost benefits attributed to service
during the year $ 610 $ 754
Interest cost on accumulated postretirement
benefit obligation 662 787
Net amortization and deferral (62) (15)
Net periodic postretirement benefit cost $ 1,210 $ 1,526
Summary information on the Company's plans as of December 31 is as follows:
1994 1993
Accumulated postretirement benefit obligation:
Retirees and dependents $ (3,100) $ (3,520)
Fully eligible active plan participants (444) (478)
Other active plan participants (3,089) (8,171)
Accrued postretirement benefit cost (6,633) (12,169)
Unrecognized gain from past experience different
from that assumed and from changes in
assumptions (2,713) (361)
Accrued postretirement benefit obligation $(9,346) $(12,530)
37
The discount rate used in determining the accumulated postretirement benefit
obligation was 8.5 percent as of December 31,1994 and 7.5 percent as of
December 31, 1993. The assumed health care cost trend rate used in
measuring the accumulated postretirement benefit obligation was 10 percent
in 1994, declining gradually to 5.5 percent over 9 years, remaining level
thereafter.
If the health care cost trend rate assumptions were increased by 1 percent,
the accumulated postretirement benefit obligation as of December 31, 1994
would be increased by $987 while the aggregate of the service and interest
cost components of net periodic postretirement benefit cost for 1994 would
be increased by $245.
Note M - Business Segment Information
Industry Segments
The Company operates in one industry segment. Using
primarily membrane technology, the Company develops,
manufactures and markets products used for analysis and
purification.
Geographical Segments
The Company operates in the geographical segments indicated
in the table below. Sales are reflected in the segment from
which the sales are made. The Americas segment includes
North and South America. The European region includes
Western and Central Europe, Russia, the Middle East and
Africa. The Asia/Pacific region includes Japan, Korea,
Taiwan, Hong Kong, China, Southeast Asia and Australia.
Transfer sales between geographical areas are generally made
at a discount from list price. Operating profits for each
geographical segment exclude general corporate expenses.
Identifiable assets consist of those assets utilized within
each respective geographic segment and exclude cash and
short-term investments and receivables arising from sale of
businesses, which are classified as corporate assets.
Americas Europe Pacific Eliminations Total
1994
Sales:
Unaffiliated
customers $180,569 $154,196 $160,781 $495,546
Unaffiliated export:
Pacific customers 806 806
European customers 900 900
Total unaffiliated 182,275 154,196 160,781 497,251
Transfer between areas 77,877 25,767 6,246 (109,890) -
Total sales $260,152 $179,963 $167,027 $(109,890) $497,251
Operating profits $ 54,301 $ 23,908 $ 24,879 $103,088
General corporate expenses (12,429)
Other expense (10,800)
Interest expense, net (2,944)
Income from continuing
operations before income taxes $ 76,915
Identifiable assets $331,730 $187,132 $144,890 $(181,285) $482,467
Corporate assets 45,186
Total assets $527,653
1993
Sales:
Unaffiliated
customers $168,800 $145,485 $128,840 $443,125
Unaffiliated export:
Pacific customers 977 977
European customers 1,264 1,264
Total unaffiliated 171,041 145,485 128,840 445,366
Transfer between areas 85,438 24,513 6,162 (116,113) -
Total sales $256,479 $169,998 $135,002 $(116,113) $445,366
38
Operating profits $ 23,180 $ 36,902 $ 27,731 $ 87,813
General corporate expenses (16,621)
Interest expense, net (7,969)
Income from continuing
operations before income taxes $ 63,223
Identifiable assets $284,750 $138,326 $141,442 $(122,941) $441,577
Corporate assets 40,642
Net current assets of
discontinued operations 138,687
Net long term assets of
discontinued operations 99,647
Total assets $720,553
1992
Sales:
Unaffiliated
customers $159,458 $154,200 $108,923 $422,581
Unaffiliated export:
Pacific customers 908 908
European customers 3,699 3,699
Total unaffiliated 164,065 154,200 108,923 427,188
Transfer between areas 80,944 23,391 7,360 (111,695) -
Total sales $245,009 $177,591 $116,283 $(111,695) $427,188
Operating profits $ 23,715 $ 40,962 $ 7,186 $ 71,863
General corporate expenses (15,791)
Interest expense, net (7,804)
Loss on sale of business (2,415) (2,415)
Income from continuing
operations before income taxes $ 45,853
Identifiable assets $271,894 $178,224 $116,175 $(125,560) $440,733
Corporate assets 70,451
Net current assets of
discontinued operations 147,480
Net long term assets of
discontinued operations 106,194
Total assets $764,858
Report of Independent Accountants
To the Shareholders and Directors of Millipore Corporation:
We have audited the accompanying consolidated balance sheets of Millipore
Corporation as of December 31, 1994 and 1993, and the related consolidated
statements of income, shareholders' equity, and cash flows for each of the
three years in the period ended December 31, 1994. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Millipore
Corporation at December 31, 1994 and 1993, and the consolidated results of its
operations and its cash flows for each of the three years in the period ended
December 31, 1994 in conformity with generally accepted accounting principles.
As discussed in Notes A, H and L to the consolidated financial statements, the
Company changed its method of accounting for postretirement benefits other
than pensions and its accounting for income taxes in 1992.
Boston, Massachusetts Coopers & Lybrand L.L.P.
January 26, 1995
39
Eleven-year Summary of Operations
Millipore Corporation
(In thousands except per share)
1994 1993 1992 1991 1990
Net sales $497,252 $445,366 $427,188 $415,075 $380,983
Cost of sales 212,675 193,575 195,462 194,557 170,049
Gross profit 284,577 251,791 231,726 220,518 210,934
Selling, general and
administrative expenses 159,591 145,647 142,701 129,593 117,214
Research and
development expenses 34,327 34,952 32,953 32,633 29,538
Restructuring charge - - - - 17,103
Operating income 90,659 71,192 56,072 58,292 47,079
Other Income (expense) (10,800) - (2,415) - -
Interest income 4,091 4,069 6,888 6,182 6,723
Interest expense (7,035) (12,038) (14,692) (13,984) (10,418)
Income from continuing
operations before
income taxes 76,915 63,223 45,853 50,490 43,384
Provision for income
taxes
excluding non-recurring 17,306 14,225 10,317 14,570 13,629
tax benfit
Nonrecurring tax - - - - -
benefit
Income from continuing 59,609 48,998 35,536 35,920 29,755
operations
Earnings (loss) from
discontinued operations - (10,851) 2,715 18,645 (6,678)
Loss on disposal of
discontinued operations (3,400) - - - -
Income before
extraordinary item and
cumulative effect
of change in 56,209 38,147 38,251 54,565 23,077
accounting principle
Extraordinary item-loss
on early extinguishment - 3,544 - - -
of debt
Cumulative effect of
change in accounting
for postretirement
benefits - - 5,068 - -
Net income $56,209 $34,603 $33,183 $54,565 $23,077
Net income per common
share:
Income from continuing $2.18 $1.75 $1.26 $1.27 $1.05
operations
Net income per common 2.05 1.24 1.17 1.93 0.82
share
Cash dividends declared 0.59 0.55 0.51 0.47 0.43
per share
Average common shares
and equivalents 27,363 27,951 28,242 28,294 28,307
Financial Data
Working Capital $100,649 $232,865 $220,378 $247,399 $225,039
Total assets 527,653 720,553 764,858 765,129 704,971
Long-term obligations 100,231 102,047 103,240 106,306 107,517
Shareholders' equity $221,277 $461,154 $452,835 $464,496 $427,008
The Company adopted SFAS # 109 "Accounting for Income Taxes" during
1992 and restated tax provisions in 1991 and 1990
and 1986.
1984 earnings per share include a $.15 per share non-recurring tax
benefit from the reversal of all deferred taxes provided on DISC income
prior to 1984.
1989 1988 1987 1986 1985 1984
Net sales $365,825 $347,267 $298,728 $251,212 $202,411 $193,190
Cost of sales 165,979 161,613 138,587 117,997 99,427 97,048
Gross profit 199,846 185,654 160,141 133,215 102,984 96,142
Selling, general and
administrative expenses 115,951 116,636 98,730 87,058 66,409 62,777
Research and
development expenses 28,756 22,336 19,742 16,756 15,132 15,407
Restructuring charge - - - - - -
Operating income 55,139 46,682 41,669 29,401 21,443 17,958
Other Income (expense) 3,149 - - - - -
Interest income 3,914 3,450 2,234 3,066 3,403 4,145
Interest expense (8,543) (6,543) (3,432) (3,762) (3,300) (3,136)
Income from continuing
operations before
income taxes 53,659 43,589 40,471 28,705 21,546 18,967
Provision for income
taxes
excluding non-recurring 11,619 10,955 10,040 10,538 5,357 5,121
tax
benefit
Nonrecurring benefit - - - - - (4,002)
Income from continuing 42,040 32,634 30,431 18,167 16,189 17,848
operations
Earnings (loss) from
discontinued operations 10,462 22,751 17,993 14,797 15,541 12,645
Loss on disposal of
discontinued operations - - - - - -
Income before
extraordinary item and
cumulative effect
of change in 52,502 55,385 48,424 32,964 31,730 30,493
accounting principle
Extraordinary item-loss
on early extinguishment - - - - - -
of debt
Cumulative effect of
change in accounting
for postretirement
benefits - - - - - -
Net income
$52,502 $55,385 $48,424 $32,964 $31,730 $30,493
Net income per common
share:
Income from continuing $1.48 $1.15 $1.07 $0.65 $0.59 $0.65
operations
Net income per common 1.85 1.96 1.71 1.18 1.15 1.11
share
Cash dividends declared 0.39 0.35 0.31 0.27 0.24 0.22
per share
Average common shares
and equivalents 28,323 28,329 28,344 27,931 27,632 27,552
Financial Data
Working Capital $249,777 $251,825 $168,594 $165,421 $146,334 $121,075
Total assets 616,747 547,997 452,387 369,414 326,903 283,517
Long-term obligations 106,147 105,946 6,378 12,094 13,446 10,630
Shareholders' equity $403,827 $362,800 $327,604 $283,547 $244,607 $214,289
40-41
Quarterly Results (Unaudited)
The Company's unaudited quarterly results are summarized below.
First Second Third Fourth
(In thousands, except per
share data) quarter quarter quarter quarter Year
1994
Net sales $118,959 $124,690 $123,551$130,052$497,252
Cost of sales 51,265 52,910 53,114 55,386 212,675
Gross profit 67,694 71,780 70,437 74,666 284,577
Selling, general and administrative
expenses 38,109 39,456 40,181 41,845 159,591
Research and development
expenses 8,558 8,446 8,367 8,956 34,327
Operating income 21,027 23,878 21,889 23,865 90,659
Other expense - - -(10,800)(10,800)
Interest income 565 713 1,976 837 4,091
Interest expense (1,858) (1,917) (1,714) (1,546) (7,035)
Income from continuing
operations before income
taxes 19,734 22,674 22,151 12,356 76,915
Provision for income taxes 4,440 5,102 4,984 2,780 17,306
Income from continuing
operations 15,294 17,572 17,167 9,576 59,609
Loss from discontinued operations - - (3,400) - (3,400)
Net income $ 15,294 $ 17,572 $ 13,767 $ 9,576 $56,209
Per share information
Income from continuing
operations $0.54 $0.62 $0.61 $0.40 $2.18
Net income $0.54 $0.62 $0.49 $0.40 $2.05
Weighted average common shares
outstanding 28,123 28,388 28,155 23,840 27,363
1993
Net sales $105,189 $114,613 $111,854$113,710$445,366
Cost of sales 45,140 49,271 49,587 49,577 193,575
Gross profit 60,049 65,342 62,267 64,133 251,791
Selling, general and administrative
expenses 36,555 36,946 36,424 35,722 145,647
Research and development
expenses 8,587 9,010 8,652 8,703 34,952
Operating income 14,907 19,386 17,191 19,708 71,192
Interest income 1,098 1,039 1,047 885 4,069
Interest expense (3,315) (3,122) (3,015) (2,586)(12,038)
Income from continuing
operations before income
taxes 12,690 17,303 15,223 18,007 63,223
Provision for income taxes 2,855 3,893 3,425 4,052 14,225
Income from continuing
operations 9,835 13,410 11,798 13,955 48,998
Loss from discontinued
operations (9,083) (579) (1,189) - (10,851)
Extraordinary item - loss on early
extinguishment of debt - - - 3,544 3,544
Net income $ 752 $ 12,831 $ 10,609$ 10,411$ 34,603
Per share information
Income from continuing
operations $0.35 $0.48 $0.42 $0.50 $1.75
Net income $0.03 $0.46 $0.38 $0.37 $1.24
Weighted average common shares
outstanding 27,983 27,946 27,921 27,954 27,951
42
Investor Information
Registrar and Transfer Agent
The First National Bank of Boston
Shareholders Services Division
P.O. Box 644
Boston, Massachusetts 02102-0644
Annual Meeting
The Annual Meeting of Shareholders of Millipore Corporation will be
held at our Bedford Massachusetts Facility (80 Ashby Road) on Thursday,
April 20, 1995 at 11 a.m.
Dividend Reinvestment
An automatic dividend reinvestment program is available to
shareholders. A descriptive brochure and authorization card are
available on request.
Reports
Quarterly results are available through facsimile, voice mail, and the
Internet, or on request from the Company. Form 10-K is filed annually
with the Securities Exchange Commission and is available on the
Internet and on request from the Company. To receive the latest
quarterly results through facsimile, call (800)758-5804 (PIN# 101371);
through voice mail call (800)605-5249; through the Internet go to URL
http://www.millipore.com. The 10-K is alos available through that
voice mail number and that Internet address. For other investor
information, contact:
Geoffrey E. Helliwell
Director of Treasury Operations
Millipore Corporation
80 Ashby Road
Bedford, Massachusetts 01730-2271
(617) 533-2032
Common Stock
Millipore's Common Stock is traded on the New York Stock Exchange. Our
symbol is MIL. Stock price information is shown below.
Millipore Stock Prices
Range of Stock Prices Dividends Declared
Per Share
1994 1993 1994 1993
High Low High Low
First Quarter $48.87 $38.50 $35.50 $25.88 $0.14 $0.13
Second Quarter 53.87 42.75 32.38 26.50 0.15 0.14
Third Quarter 57.00 50.00 34.25 29.75 0.15 0.14
Fourth Quarter 55.13 46.63 40.25 32.75 0.15 0.14
43