Thermo Fisher Scientific Inc. (NYSE: TMO), the world leader in serving science, today reported its financial results for the first quarter ended April 3, 2021.
First Quarter 2021 Highlights
- First quarter revenue increased 59% to $9.91 billion.
- First quarter GAAP diluted earnings per share (EPS) increased 198% to $5.88.
- First quarter adjusted EPS increased 145% to $7.21.
- Continued significant role in enabling the COVID-19 response, helping to scale vaccine production and supporting testing globally, and accelerated growth in the base business.
- Strong start to the year in terms of product launches including two Thermo Scientific Orbitrap Exploris Gas Chromatography-Mass Spectrometers, which bring high-resolution analysis to a range of applications, including toxicology and metabolomics, the Thermo Scientific Spectra Ultra electron microscope for improved throughput and workflow in materials science applications, the Kingfisher Apex Purification System for high throughput sample preparation and the Thermo Scientific AerosolSense Sampler, an in-air surveillance solution for pathogens, including SARS-CoV-2.
- Continued to increase our capacity to meet customer demand. In the quarter, we began shipping single use technologies from our new facility in Suzhou to bioproduction customers in China. We also brought additional capacity online in Singapore for bioproduction and at two sites in North America for laboratory plastics.
- Advanced our environmental, social and governance priorities and committed to an impact investment of $25 million in financial institutions focused on minority communities.
- Very active capital deployment to start the year including repurchasing $2 billion of stock, increasing our dividend by 18% and completing the acquisition of Mesa Biotech, Inc., a point-of-care molecular diagnostic company.
- After quarter end, announced an agreement to acquire PPD, Inc., a leading global provider of clinical research services, for $17.4 billion.
Adjusted EPS, adjusted operating income, adjusted operating margin and free cash flow are non-GAAP measures that exclude certain items detailed later in this press release under the heading “Use of Non-GAAP Financial Measures.”
“We are off to an excellent start to the year. Market conditions are strong, and our team is executing at an incredibly high level. From a financial perspective, we again delivered exceptional growth in revenue, earnings and free cash flow for the quarter,” said Marc N. Casper, chairman, president and chief executive officer of Thermo Fisher Scientific. “We began accelerating our investments in talent, capabilities and capacity in the second half of 2020 and we are already starting to see the benefits of those actions which will ensure an even brighter future for our company.”
Casper added, “I am also very excited about our recently announced agreement to acquire PPD, Inc. This is a great fit for our company and will strengthen our value proposition for our largest and fastest growing end market, provide exciting career opportunities for our colleagues, and create significant shareholder value.”
First Quarter 2021
Revenue for the quarter grew 59% to $9.91 billion in 2021, versus $6.23 billion in 2020. Organic revenue growth was 53%; acquisitions increased revenue by 2% and currency translation increased revenue by 4%.
GAAP Earnings Results
GAAP diluted EPS in the first quarter of 2021 increased 198% to $5.88, versus $1.97 in the same quarter last year. GAAP operating income for the first quarter of 2021 was $3.05 billion, compared with $0.91 billion in the year-ago quarter. GAAP operating margin was 30.8%, compared with 14.5% in the first quarter of 2020.
Non-GAAP Earnings Results
Adjusted EPS in the first quarter of 2021 increased 145% to $7.21, versus $2.94 in the first quarter of 2020. Adjusted operating income for the first quarter of 2021 grew 155% compared with the year-ago quarter. Adjusted operating margin was 35.4%, compared with 22.1% in the first quarter of 2020.
Annual Guidance for 2021
The company will provide updates on its 2021 financial guidance during its earnings conference call this morning at 8:30 a.m. Eastern time.
Segment Results
Management uses adjusted operating results to monitor and evaluate performance of the company’s four business segments, as highlighted below. Since these results are used for this purpose, they are also considered to be prepared in accordance with GAAP.
Life Sciences Solutions Segment
Life Sciences Solutions Segment revenue grew 137% to $4.20 billion in the first quarter of 2021, compared with revenue of $1.77 billion in the first quarter of 2020. Segment adjusted operating margin was 54.2%, versus 38.0% in the 2020 quarter.
Analytical Instruments Segment
Analytical Instruments Segment revenue grew 26% to $1.39 billion in the first quarter of 2021, compared with revenue of $1.10 billion in the first quarter of 2020. Segment adjusted operating margin was 19.6%, versus 15.5% in the 2020 quarter.
Specialty Diagnostics Segment
Specialty Diagnostics Segment revenue grew 69% to $1.62 billion in the first quarter of 2021, compared with revenue of $0.96 billion in the first quarter of 2020. Segment adjusted operating margin was 26.5%, versus 24.7% in the 2020 quarter.
Laboratory Products and Services Segment
Laboratory Products and Services Segment revenue grew 32% to $3.60 billion in the first quarter of 2021, compared with revenue of $2.73 billion in the first quarter of 2020. Segment adjusted operating margin was 14.8%, versus 10.8% in the 2020 quarter.
