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SigmaAldrich Corp. Reports Operating Results (10-Q)

July 24, 2012 | About:
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SigmaAldrich Corp. (SIAL) filed Quarterly Report for the period ended 2012-06-30.

Sigma-aldrich Corporation has a market cap of $8.63 billion; its shares were traded at around $68.75 with a P/E ratio of 18.8 and P/S ratio of 3.5. The dividend yield of Sigma-aldrich Corporation stocks is 1.1%. Sigma-aldrich Corporation had an annual average earning growth of 11.8% over the past 10 years. GuruFocus rated Sigma-aldrich Corporation the business predictability rank of 4.5-star.

Highlight of Business Operations:Net sales were $664 in the second quarter of 2012, up 4 percent from the second quarter of 2011. Our recent acquisitions of Vetec Quimica Fina Ltda, BioReliance and Research Organics, Inc., acquired in May 2011, January 2012 and March 2012, respectively, contributed $39 or 6 percent to this sales growth. The effect of changes in foreign currency exchange rates decreased sales growth by $32 or 5 percent. Excluding the effects of acquisitions and changes in foreign currency exchange rates, sales increased organically by $20 or 3 percent. Factors contributing to the organic growth included pricing which added 1 percent and volume which added 2 percent.

Net sales were $1,329 in the six months ended June 30, 2012, up 5 percent from the prior year period in 2011. Our recent acquisitions contributed $63 or 5 percent to this sales growth. The effect of changes in foreign currency exchange rates decreased sales growth by $41 or 3 percent. Excluding the effects of acquisitions and changes in foreign currency exchange rates, sales increased organically by $38 or 3 percent. Factors contributing to the organic growth included pricing which added 2 percent and volume which added 1 percent.

Research total sales were $441 for the second quarter of 2012 compared to $454 during the same period last year. Organic sales increased by $5 or 1 percent. The increase was concentrated primarily in our Analytical product group, which increased $7. Research total sales were $909 for the first half of 2012 compared to $906 during the same period last year. Organic sales increased by $21 or 2 percent. The increase was concentrated primarily in our Analytical, Biology and Lab Essentials product groups, which increased $12, $6 and $5, respectively. Geographically, the increase in Research sales over the prior year was largely led by the APLA region in both the three and six month periods ended June 30, 2012, which increased 5 and 7 percent organically or $5 and $15, respectively.

SAFC total sales were $223 for the second quarter of 2012 compared to $183 during the same period last year. Organic sales increased by $15 or 8 percent. The primary drivers for this increase were higher demand for our custom pharmaceutical products of $10, higher sales of bulk chemical products for manufacturing in our supply solutions business of $3 and higher demand for our Hitech products of $2. SAFC total sales were $420 for the first half of 2012 compared to $363 during the same period last year. Organic sales increased by $17 or 5 percent. The primary drivers for this increase were higher demand for our custom pharmaceutical products of $12 and higher sales of bulk chemical products for manufacturing in our supply solutions business of $5. In both the three and six month periods ended June 30, 2012, all geographic regions contributed to SAFC's growth.

For the three months ended June 30, 2012, when compared to the same period in the prior year, $8 of the increase was due to higher material, manufacturing and distribution costs resulting from higher sales volumes, principally in the SAFC business, and $30 of the increase was due to additional costs contributed by acquisitions. These increases were partially offset by a $20

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