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Fourth Quarter and Year-End ResultsMillipore Conference Call, January 26, 2004
2
Forward-looking statements/risk factors
In order to take advantage of the safe harbor provisions of the private securities litigation reform act of 1995, you should understand that we will be making forward-looking statements in this conference. These statements involve a number of risks and uncertainties, all of which are set forth in detail in our annual report on form 10-K, subsequent quarterly reports on form 10-Q, and our other SEC filings. We assume no obligation to update any forward-looking statement based on new information, future events or any other reason.
3
Q4, 2003 - better than expected
16% revenue growth over Q4 2002
7% revenue growth in local currency
GAAP earnings $0.66 per share
Pro-forma earnings from operations $0.53
Biotechnology - 7% growth
Life sciences - 11% growth
Other bioscience - 6% growth
4
Americas44%
Europe37%
Asia/Pacific19%
FY 2003
2003 revenues (in local currencies)
Biotechnology34%
Life Science
14%
OtherBioscience Applications
52%
FY 2003
Consumables and Services
82%
Equipment18%
FY 2003
5
Q4 revenue growth - by geographic region
Americas $ 89 $ 79 12% 12%
Europe 86 72 19% 2%
Asia/Pacific 41 35 18% 7%
Total U.S. dollar $216 $186 16% 7%
% Growth Local
$ in millions Q4 2003 Q4 2002 % Growth Currency
6
Revenue growth - by market
Biotechnology $69 $65 7% 6%
Life Science 29 26 11% 5%
Other Bioscience 102 96 6% 5%
Total local currency 200 187 7% 6%
Foreign Exchange 16 (1)
Total U.S. dollar $216 $186 16% 14%
Q4 Full Year
$ in millions Q4, 2003 Q4, 2002 % Growth % Growth
7
Biotechnology - quarter to quarter variations (in local currencies)
$ millions
Quarterly Growth Q1 2000 – Q4 2003
$0
$10
$20
$30
$40
$50
$60
$70
$80
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
0%
3%
6%
9%
12%
15%
18%
21%
24%
27%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Revenues by Quarter Q1 2000 – Q4 2003
‘00 ‘01 ‘02 ‘03 ‘00 ‘01 ‘02 ‘03
8
Biotechnology - strength in consumables (in local currencies)
Revenues by Quarter Biotech Consumables and Hardware: Q1 2001 – Q4 2003
’02 ’03
Quarterly Growth Biotech Consumables and Hardware: Q1 2002 – Q4 2003
-10%
-5%
0%
5%
10%
15%
20%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Biotech ConsumablesBiotech Hardware
$ millions
$0
$10
$20
$30
$40
$50
$60
$70
$80
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Biotech ConsumablesBiotech Hardware
’01 ’02 ’03
9
Volume variables Patient population Indications Dosage
Biotech growth/Millipore growth
Other manufacturing variables Expression level Purity in cell harvest Dosage form Degree of optimization New/retrofitted plant
MAb Revenues for Millipore$15 - $55 per gram
10
Biological pipeline
Over 2000 biologicals in pipeline or launched
0
100
200
300
400
500
600
700
800
900
1000
1100
1200
1300
Pre-clinical Phase 1 Phase 2 Phase 3 AwaitingApproval orApproved
1194
227
357
84
374
Pharmaprojects V5, from PJP Publications, NYC & London, January, 2004
0
100
200
300
400
500
600
700
800
900
1000
Pre-clinical Phase 1 Phase 2 Phase 3 AwaitingApproval orApproved
Over 500 therapeutic antibodies in pipeline or launched
4579
20 22
339
11
Forecast
Data
Review
Phase 3
Phase 2
Phase 1
Recombinant Products
-
50
100
150
200250
300
350
400
450
500
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Num
ber
of d
rugs
vaccine
other
hormone
gene therapy
cytokine
Ab
Current Drug Development Phase corresponding to year of marketing approval - one scenario
Source : PharmaProjects
Potential drug approvals
Recombinant Products
12
Life science: quarterly revenue growth and trends (in local currencies)
$ millionsQuarterly Growth Q1 2000 – Q4 2003
$0
$5
$10
$15
$20
$25
$30
$35
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4-5%
0%
5%
10%
15%
20%
25%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Revenues by Quarter Q1 2000 – Q4 2003
‘00 ‘01 ‘02 ’03 ‘00 ‘01 ‘02 ’03
13
Other bioscience – quarterly revenue and trends (in local currencies)
$ millionsQuarterly Growth: Q1 2000 – Q4 2003
$0
$20
$40
$60
$80
$100
$120
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
-5%
0%
5%
10%
15%
20%
25%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Revenues by Quarter: Q1 2000 – Q4 2003
‘00 ‘01 ‘02 ’03 ‘00 ‘01 ‘02 ’03
14
Actual Dollars (In millions, except EPS) Q4, 2003 Q4, 2002 Growth
Sales $ 215.8 $ 185.9 16%
Gross Profit 109.0 98.6 11%% of Sales 50.5% 53.0%
SG&A 64.9 56.0 16%% of Sales 30.1% 30.1%
R&D 16.5 13.5 22%% of Sales 7.6% 7.3%
Restructuring and other - 0.1 N/A% of Sales 0.0% 0.1%
Operating income 27.6 29.0 (5%)% of Sales 12.8% 15.6%
Net income $ 32.6 $ 19.9 64%
EPS $ 0.66 $ 0.41 61%
Q4 income statement – GAAP Results
15
Q4 2003 Reconciliation
Quarter ended December 31, 2003
Impact of Q4Severance Costs
Impact of Tax and Fixed Asset Proforma(In millions, except per share data) GAAP Results Adjustment Write-Offs Results
Sales $ 215.8 $ - $ - $ 215.8
Gross Profit 109.0 2.4 111.4% of Sales 50.5% 51.6%
SG&A 64.9 (4.4) 60.5% of Sales 30.1% 28.0%
R&D 16.5 (1.5) 15.0% of Sales 7.6% 7.0%
Operating Income 27.6 - 8.3 35.9% of Sales 12.8% 16.6%
Pretax Income 24.2 8.3 32.5
(Benefit) provision for income taxes (8.4) 12.0 2.9 6.5
Net Income $ 32.6 $ (12.0) $ 5.4 $ 26.0
EPS $ 0.66 $ (0.24) $ 0.11 $ 0.53
16
Actual Dollars (In millions, except EPS) 2003 2002 Growth
Sales $ 799.6 $ 704.3 14%
Gross Profit 430.4 396.1 9%% of Sales 53.8% 56.2%
SG&A 246.8 219.1 13%% of Sales 30.9% 31.1%
R&D 58.4 52.3 12%% of Sales 7.3% 7.4%
Restructuring and other (1.4) 1.1 N/A% of Sales (0.2%) 0.2%
Operating income 126.6 123.6 2%% of Sales 15.8% 17.5%
Net income from continuing operations $ 100.8 $ 80.8 25%
EPS from continuing operations $ 2.06 $ 1.67 23%
Full Year GAAP Results
Year ended December 31,
17
Net Sales $ 799.6 $ $ - $ 799.6
Gross Profit 430.4 2.4 432.8% of Sales 53.8% 54.1%
SG&A 246.8 (4.4) 242.4% of Sales 30.9% 30.3%
R&D 58.4 (1.5) 56.9% of Sales 7.3% 7.1%
Restructuring and Other (1.4) 1.4 -% of Sales (0.2%) 0.0%
Operating Income 126.6 - 6.9 133.5% of Sales 15.8% 16.7%
Pretax Income 112.2 6.9 119.1
Provision for income taxes 11.4 12.0 2.6 26.0
Net Income $ 100.8 $ (12.0) $ 4.3 $ 93.1
EPS $ 2.06 $ (0.24) $ 0.08 $ 1.90
Full Year 2003 Reconciliation
Impact of Q2 & Q3Restructuring and
Other and Q4Severance Costs
Impact of Tax and Fixed Asset ProformaActual Dollars (In millions, except EPS) GAAP Results Adjustment Write-Offs Results
Year ended December 31, 2003
18
50.0
50.5
51.0
51.5
52.0
52.5
53.0
53.5
54.0
54.5
55.0
55.5
56.0
2003 vs 2004 Margin Analysis
2003 Volume Leverage
2003 Unusual Charges
Mix to Higher Margin
Products
NHMembrane
Plant Start-up
Plant Rationalization
Quality Process
Improvements
Fx 2004
53.8%0.4%
0.7%
0.5%
-0.3%-0.4% 54.0%
2003 2004
-0.4%
-0.3%
19
Currency effects
Euro/Dollar, 10/1/03 - 12/31/03Yen/Dollar, 10/1/03 - 12/31/03
0.78
0.8
0.82
0.84
0.86
0.88
0.9
10/1
/200
3
10/8
/200
3
10/1
5/20
03
10/2
2/20
03
10/2
9/20
03
11/5
/200
3
11/1
2/20
03
11/1
9/20
03
11/2
6/20
03
12/3
/200
3
12/1
0/20
03
12/1
7/20
03
12/2
4/20
03
12/3
1/20
03
104
106
108
110
112
114
10/1
/200
3
10/8
/200
3
10/1
5/20
03
10/2
2/20
03
10/2
9/20
03
11/5
/200
3
11/1
2/20
03
11/1
9/20
03
11/2
6/20
03
12/3
/200
3
12/1
0/20
03
12/1
7/20
03
12/2
4/20
03
12/3
1/20
03
20
Guidance, 2004
Revenue growth: Actual dollar: 9 to 11% Local currency: 4 to 6%
Revenue growth by market - local currency Biotechnology: 5 to 7% Life Sciences: 6 to 8% Other Bioscience: 3
to 5%
Gross Margins: averaging 54% of revenue
SG&A: averaging 30% of revenue
R&D: between 7 and 7.5% of revenue
Contribution: approximately 17% of revenue
EPS: $2.14 to $2.23 per share
Capital Expenditures $65M
Depreciation and amortization $43M
Free cash flow $125M-$130M