Geographically, weakness was most pronounced in Europe, which was off 16 percent from last year, while revenue in the Americas was off 10 percent. Asia remained an area of strength, with Japan up 7 percent from last year and other Asia up 12 percent. China was particularly robust, up 29 percent from one year ago. By product platform, Gas (GC) and Liquid Chromatography (LC) were both weak, offsetting continued strength in GC / Mass Spectrometry (GC/MS), LC/MS and microarrays.
Life Sciences revenues of $241 million were down 7 percent in the second quarter from one year ago. Spending by Pharma and Biotech customers was down 11 percent, with a lengthening of the replacement cycle in the current soft environment and funding pressures impacting smaller biotech firms. Sales to the academic and government markets continued strong, 10 percent above one year ago, with robust demand in Mass Spec systems as well as for microarrays.
Chemical Analysis revenues of $257 million were down 6 percent from last year. Food safety continued its strong momentum and was up 30 percent from one year ago, while weakness was seen across most industrial markets. From a platform perspective, demand remained weak for GCs and relatively strong for GC/MS and LC/MS systems.
Second quarter segment income from operations of $89 million was $4 million above last year’s results despite a $32 million decline in revenues. Gross margins were up 1 ½ points from last year, while operating margins, at 18 percent, were two points above one year ago. Segment Return On Invested Capital(2) improved 2 points to 24 percent.
|($ millions except where noted)|
|Gross Margin, %||52||%||55||%||59||%|
|Income from Operations||(6||)||7||120|
|Return On Invested Capital (2) , %||(1||%)||3||%||28||%|