Thermo experiences high operating profit growth

By Emilie Reymond

- Last updated on GMT

Related tags Laboratory equipment Chief executive officer

Thermo Electron has reported an operating profit growth of 26 per
cent to $143.2m (€111.2m) and boosted its profit margin by three
percentage points to 20 per cent in its second quarter results.

The analytical instrument manufacturer also saw a sales growth of nine per cent to $713m in the second quarter of 2006, compared with $654m in the 2005 quarter, an increase attributed to strong sales of new products.

The firm's life and laboratory science segment sales rose 11 per cent. This part of the company provides analytical instruments, scientific equipment, services and software solutions for life science, drug discovery, clinical, environmental and industrial laboratories.

At the same time, the company's measurement and control division, which is dedicated to providing analytical instruments used in manufacturing processes and in-the-field applications associated with safety and homeland security, saw a 5 per cent increase in sales.

"We had a solid increase in revenues as well as yet another great quarter of margin expansion,"​ said Marijn Dekkers, president and chief executive officer at Thermo.

"This excellent performance is the result of ongoing strength in our major end markets and our ability to provide our customers with a breadth of innovative solutions."

However, pre-tax profit dropped by 13 per cent although the firm was not available to comment on this result at the time of publishing.

Looking ahead, the firm said it expected its sales to remain in the range of $2.81 - $2.86bn in 2006, indicating a seven - nine per cent growth over last year.

Analysts currently estimate earnings of $2.87 billion for the full year.

The company said it would revise full year 2006 guidance on close of the pending merger with Fisher Scientific.

Thermo Electron agreed in May to buy Fisher Scientific International - which distributes lab equipment - for $10.6bn in stock to become the largest supplier of medical laboratory equipment.

The merger is expected to be completed in the fourth quarter, and still needs approval from shareholders and industry regulators.

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