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1 Agilent Technologies Padraig McDonnell, President & CEO J.P. Morgan Healthcare Conference January 14, 2025
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2 Safe harbor This presentation contains forward-looking statements (including, without limitation, statements on Agilent's (the "company" or "our") strategy, priorities, growth and growth opportunities, productivity, reinvestment, customer focus, evolving product mix, work environment and innovation plans; the effects of our new organizational structure and Ignite transformation; the size and growth of our markets; our revenue, revenue growth, earnings per share, operating margin and margin expansion, operating cash flow, net interest and other income/expense, dividends, share repurchases and share count assumptions; the effects of acquisitions; and our products, services and solutions) that involve risks and uncertainties that could cause Agilent's results to differ materially from management’s current expectations. The words “anticipate,” “plan,” “estimate,” “expect,” “intend,” “will,” “should,” “forecast,” “project” and similar expressions, as they relate to the company, are intended to identify forward-looking statements. In addition, other risks that the company faces in running its operations include the ability to execute successfully through business cycles; the ability to successfully adapt its cost structures to continuing changes in business conditions; ongoing competitive, pricing and gross margin pressures; the risk that our strategic and cost-cutting initiatives will impair our ability to develop products and remain competitive and to operate effectively; the impact of geopolitical uncertainties on our markets and our ability to conduct business; the impact of currency exchange rates on our financial results; the ability to improve asset performance to adapt to changes in demand; the ability to successfully introduce new products at the right time, price and mix, and other risks detailed in the company’s filings with the Securities and Exchange Commission, including our annual report on Form 10-K for the year ended October 31, 2024. The company assumes no obligation to update the information in this presentation. This presentation and the Q&A that follows include non- GAAP measures. Non-GAAP measures exclude charges primarily related to restructuring and other related costs, asset impairments, amortization of intangibles, transformational initiatives, acquisition and integration costs, and net (gain) loss on equity securities. We also exclude any tax benefits that are not directly related to ongoing operations and which are either isolated or are not expected to occur again with any regularity or predictability. With respect to the company’s guidance, most of these excluded amounts pertain to events that have not yet occurred and are not currently possible to estimate with a reasonable degree of accuracy. Accordingly, no reconciliation to GAAP amounts has been provided. 2025 J.P. Morgan Healthcare Conference
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3 Takeaways for today Leading market share and sustainable competitive advantage via customer focus Re-accelerating growth through innovation and market share gains Driving productivity and reinvestment through Ignite Established leader in $80B markets driven by secular growth Cultivating strong leadership team and culture Delivering 5-7% long-term core growth and double-digit EPS 2025 J.P. Morgan Healthcare Conference
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4 Leading lab partner with unsurpassed capabilities and scale FY24 operating margin(1) 26.4%285K+ Labs served Countries served 110 FY24 revenue $6.5B Lab partner with global scale $5.29 FY24 earnings per share(1) Americas EMEA Asia-Pacific Services, Consumables and Software 64% Instrumentation 36% FY24 Revenue Evolving product mix Services, consumables and software up 600bps in 5 years 40% FY24 Rev 27% FY24 Rev 33% FY24 Rev (1) Presented on a non-GAAP basis; reconciliations to closest GAAP equivalent provided on Agilent’s Investor Relations website. 2025 J.P. Morgan Healthcare Conference
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5 Serving growing markets that advance quality of life Pharma & BioPharma Academic & Government $14B (1) 3-5% growth Opportunity $80B (1) 4-6% growth $25B (1) 5–7% growth Pharma & BioPharma Clinical & Diagnostics Clinical & Diagnostics $20B (1) 5-7% growth Applied Markets Environmental & Forensics $7B (1) 2-4% growth Chemical & Advanced Materials $8B (1) 3-5% growth Food $6B (1) 2-4% growth (1) 2024 Total Available Market. Market size and long-term growth rates per company estimates. 2025 J.P. Morgan Healthcare Conference
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6 Agilent’s strong fundamentals $1B+ Digital orders in FY24 Record level for digital orders In key platform technologies #1 Leading portfolio FY20-24 FCF as a % of adjusted net income 84% Strong free cash flow conversion Industry leading customer satisfaction rating 90%+ Unparalleled customer support Customer retention rate 90%+ Robust customer retention #11 Fortune’s World’s Best Workplaces | Forbes World’s Best Employers | Newsweek America’s greatest workplaces Agilent’s leading work environment enables teams to drive impact 2025 J.P. Morgan Healthcare Conference
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7 Strategy built on customer-centric vision Customer end-markets Clinical & Diagnostics Applied Markets Pharma & BioPharma Portfolio expansion and innovation High growth segments Lab productivity Software and informatics Strategic priorities Critical enablers Commercial Digital Ignite Top talent To deliver trusted answers and insights to advance the quality of life Innovate and deliver seamless solutions for our customers to expand frontiers of science Mission Vision 2025 J.P. Morgan Healthcare Conference
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8 New organizational structure supports market and customer focus Agilent CrossLab Group (ACG) Applied Markets Group (AMG) Life Sciences & Diagnostics Group (LDG) Commercial Organization Providing best-in-class customer-first service across all end markets Clinical & Diagnostics Applied Markets Pharma & BioPharma Liquid Chromatography (LC) LC Mass Spectrometry (LCMS) NASD + BIOVECTRA (CDMO) Cell Analysis Genomics Pathology Companion Diagnostics Gas Chromatography (GC) GC Mass Spectrometry (GCMS) Spectroscopy Vacuum Certified Pre-owned Instruments Analytical Consumables Services Software Lab Automation $2.5B $1.3B $2.7B Angelica Riemann Simon May Mike Zhang 2025 J.P. Morgan Healthcare Conference
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9 Launching innovative solutions to meet customer needs Applied Markets Enhancing sensitivity and speed instruments for high-growth applications 8850 GC System New 7010D Triple Quadrupole GCMS Pharma & BioPharma Upgrading solutions to drive higher throughput and efficiency 1290 & 1260 Infinity III LC Revident LC/Q-TOF Clinical & Diagnostics Delivering superior patient outcomes with enhanced precision Dako Omnis IHC/ISH platform Hundreds of Instrument + Consumables + Services workflows launched to solve customer problems Smallest high- performance GC Leading sensitivity First smart- featured LC High resolution and accuracy Leading throughput and turnaround 2025 J.P. Morgan Healthcare Conference
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10 FY20-24 Core Revenue CAGR: 8% $0.9B (3) in Consumables FY20-24 Core Revenue CAGR: 19% $0.3B (2) in NASD Continuing to shift portfolio towards recurring revenues FY20-24 increase in service-contract attach rate ~400 bps FY20-24 Core Revenue CAGR: 10% $1.6B (2) in Services Over the past decade Non-Instruments contributed 80% of revenue growth in past decade(1) Recent Progress FY14 FY24 46% 54% 36% 64% Instruments Non-Instruments (1) 2014 revenue excluding Keysight Technologies = $4.0B increasing to $6.5B in FY24, non-instruments represented $2.0B of increase; (2) FY24 Revenue for Analytical Lab Services; (3) FY24 Revenue 2025 J.P. Morgan Healthcare Conference
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11 Ignite: Embarking on a transformational journey Simplicity & Customer- Centricity Productivity & Scalability Growth Acceleration Better combine product offerings, expand portfolio, and accelerate innovation Operate with customer first mindset and reduce complexity in processes Increase operational productivity and reduce overlapping activities For our shareholders Deliver industry-leading shareholder value through differentiated growth For our employees Reduce bureaucracy and complexity to enhance our ability to serve our customers For our customers Create a seamless customer experience across Agilent products, software and services Impact 2025 J.P. Morgan Healthcare Conference
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12 Our new market-centric strategy and Ignite transformation drive differentiated results. Inorganic capital deployment is an upside to long-range guidance. Outcomes: deliver above-market growth & margin expansion (1) Operating Model over the next 3-5 years assuming normalized market growth of 4-6%, Does not include FY25 guidance; (2) Core revenue growth excludes impact of future M&A and changes in currency translation. Core Revenue EPS Growth 5-7% annually (1)(2) 50-100+ bps/yr (1) Above Market Growth Operating Margin Expansion Double Digits 2025 J.P. Morgan Healthcare Conference
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13 1.2 1.3 2.1 2.5 2.0 2.7 Capturing market opportunities drives long-term growth algorithm FY20 FY24 ACG LDG AMG $5.3B $6.5B +6% CAGR +5-7% (1) Projected Long-Term Growth (1) Core growth, excluding the impact of FX and future M&A – Assumes normalized market growth of 4-6%. Market-focused organization delivering above market growth $6.8-6.9B(2) FY25 FY28+ High-Single Digits Mid to High-Single Digits Low to Mid-Single Digits Long-term Projected Segment Growth Increasing connect rates New productivity solutions Enterprise Solutions Maximizing NPI (eg Infinity III) Specialized CDMO capabilities Pathology growth via advanced staining PFAS Market Leadership Leveraging Semicon and EV battery growth Key Growth Drivers (2) Per company guidance as of Nov 25, 2024 2025 J.P. Morgan Healthcare Conference
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14 Margin expansion and reinvestment enabled by Ignite Leverage on revenue growth and Ignite drive 50-100+ bps annual Op Margin Expansion (1) Presented on a non-GAAP basis; reconciliations to closest GAAP equivalent provided on Agilent’s Investor Relations website. FY20 FY24 23.5%(1) 26.4%(1) +50 bps +50-100+ bps -50 bps Leverage on Revenue Growth and Mix Software Digital Operating Model Pricing Procurement Strategic Re-investment Revenue Leverage 50-100+ bps Annual Op Margin Expansion Ignite Programs Annual Operating Margin Improvement 2025 J.P. Morgan Healthcare Conference
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Q1 & FY25 guidance reminder 2025 J.P. Morgan Healthcare Conference 15 (1) As of Nov 25, 2024, based on forecasted currency exchange rates. Presented on a non -GAAP basis. (2) Core growth is reported growth adjusted for the effects of acquisitions and divestitures, and FX. (3) The 2024 Stock Repurchase Program that authorized up to $2 billion was approved by the Board in May 2024. The new program became effective on August 1, 2024 ; however, the 2023 Stock Repurchase Program was allowed to be depleted first. Based on forecasted currency exchange rates Q1 25 Guidance (1) Low End High End FY 25 Guidance (1) Low End High End Net Revenue ($M) $1,650 $1,680 Net Revenue ($M) $6,790 $6,870 Core Revenue Growth (2) -2.0% -0.2% Core Revenue Growth (2) +2.5% +3.5% -0.3% FX, +1.8% M&A includes -2% Lunar New Year impact -0.2% FX, +2.0% to +2.2% M&A EPS $1.25 $1.28 EPS $5.54 $5.61 FY25 Financial Considerations Net Interest + Other Income/Expense: $25M of expense ($2M expense for Q1) Guidance assumes diluted share counts of 286M for Q1 and for the full year Operating Cash Flow of $1.6-1.7B and CapEx of $0.45B Shareholder Returns: $287M in dividends. Anti-dilutive share repurchases at a minimum.(3) EPS Guidance includes $0.05 of dilution from BIOVECTRA and associated financing
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16 Takeaways for today Leading market share and sustainable competitive advantage via customer focus Re-accelerating growth through innovation and market share gains Driving productivity and reinvestment through Ignite Established leader in $80B markets driven by secular growth Cultivating strong leadership team and culture Delivering 5-7% long-term core growth and double-digit EPS 2025 J.P. Morgan Healthcare Conference
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GAAP Revenue $ 6,510 $ 5,339 Income from operations: GAAP Income from operations 1,488$ 22.9% 846$ 15.8% Non-GAAP adjustments: Restructuring and other related costs 76 — Asset impairments 8 99 Intangible amortization 102 184 Transformational initiatives 11 53 Acquisition and integration costs 12 41 Other 24 33 Non-GAAP income from operations 1,721$ 26.4% 1,256$ 23.5% 2.9% AGILENT TECHNOLOGIES, INC. RECONCILIATION OF NON-GAAP INCOME FROM OPERATIONS AND OPERATING MARGINS (In millions, except margin data) (Unaudited) We provide non-GAAP income from operations and non-GAAP operating margin amounts in order to provide meaningful supplemental information regarding our operational performance and our prospects for the future. These supplemental measures exclude, among other things, charges related to restructuring and other related costs, asset impairments, amortization of intangibles, transformational initiatives and acquisition and integration costs. Our management recognizes that items such as amortization of intangibles can have a material impact on our cash flows and/or our net income. Our GAAP financial statements including our statement of cash flows portray those effects. Although we believe it is useful for investors to see core performance free of special items, investors should understand that the excluded items are actual expenses that may impact the cash available to us for other uses. To gain a complete picture of all effects on the company’s profit and loss from any and all events, management does (and investors should) rely upon the GAAP income statement. The non-GAAP numbers focus instead upon the core business of the company, which is only a subset, albeit a critical one, of the company’s performance. Readers are reminded that non-GAAP numbers are merely a supplement to, and not a replacement for, GAAP financial measures. They should be read in conjunction with the GAAP financial measures. It should be noted as well that our non-GAAP information may be different from the non-GAAP information provided by other companies. Page 1 FY24 FY20 Operating Margin % Operating Margin % Year Over Year Percent Pts Inc/(Dec)
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Revenue: Life Sciences and Diagnostics Markets Group (LDG) 2,466$ Agilent Crosslab Group (ACG) 2,747 Applied Markets Group (AMG) 1,297 Agilent GAAP Revenue $ 6,510 Income from operations: GAAP Income from operations 1,488$ 22.9% Non-GAAP adjustments: Restructuring and other related costs 76 Asset impairments 8 Intangible amortization 102 Transformational initiatives 11 Acquisition and integration costs 12 Other 24 Non-GAAP income from operations 1,721$ 26.4% Breakdown of reportable segment income from operations: Life Sciences and Diagnostics Markets Group (LDG) 484$ 19.6% Agilent Crosslab Group (ACG) 925 33.7% Applied Markets Group (AMG) 312 24.0% Agilent - Non-GAAP income from operations 1,721$ 26.4% AGILENT TECHNOLOGIES, INC. RECONCILIATION OF OPERATING INCOME AND MARGIN TO NON-GAAP AND SEGMENT OPERATING INCOME AND MARGIN (In millions, except margin data) (Unaudited) FY24 Page 2 We provide non-GAAP income from operations and non-GAAP operating margin amounts in order to provide meaningful supplemental information regarding our operational performance and our prospects for the future. These supplemental measures exclude, among other things, charges related to restructuring and other related costs, asset impairments, amortization of intangibles, transformational initiatives and acquisition and integration costs. Our management recognizes that items such as amortization of intangibles can have a material impact on our cash flows and/or our net income. Our GAAP financial statements including our statement of cash flows portray those effects. Although we believe it is useful for investors to see core performance free of special items, investors should understand that the excluded items are actual expenses that may impact the cash available to us for other uses. To gain a complete picture of all effects on the company’s profit and loss from any and all events, management does (and investors should) rely upon the GAAP income statement. The non-GAAP numbers focus instead upon the core business of the company, which is only a subset, albeit a critical one, of the company’s performance. Readers are reminded that non-GAAP numbers are merely a supplement to, and not a replacement for, GAAP financial measures. They should be read in conjunction with the GAAP financial measures. It should be noted as well that our non-GAAP information may be different from the non-GAAP information provided by other companies. Operating Margin %
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Net income Diluted EPS GAAP net income 1,289$ 4.43$ Non-GAAP adjustments: Restructuring and other related costs 76 0.26 Asset impairments 19 0.06 Intangible amortization 102 0.35 Transformational initiatives 11 0.04 Acquisition and integration costs 12 0.04 Pension settlement loss 2 0.01 Net (gain) loss on equity securities (1) — Other 17 0.06 Adjustment for taxes (a) 12 0.04 Non-GAAP net income 1,539$ 5.29$ Transformational initiativesinclude expenses associated with targeted cost reduction activities such as manufacturing transfers including costs to move manufacturing, site consolidations, legal entity and other business reorganizations, insourcing or outsourcing of activities. Such costs may include move and relocation costs, one-time termination benefits and other one-time reorganization costs. Included in this category are also expenses associated with company programs to transform our product lifecycle management (PLM) system and human resources and financial systems. Acquisition and Integration costs include all incremental expenses incurred to effect a business combination. Such acquisition costs may include advisory, legal, tax, accounting, valuation, and other professional or consulting fees. Such integration costs may include expenses directly related to integration of business and facility operations, the transfer of assets and intellectual property, information technology systems and infrastructure and other employee-related costs. Page 3 Our management uses non-GAAP measures to evaluate the performance of our core businesses, to estimate future core performance and to compensate employees. Since management finds this measure to be useful, we believe that our investors benefit from seeing our results “through the eyes” of management in addition to seeing our GAAP results. This information facilitates our management’s internal comparisons to our historical operating results as well as to the operating results of our competitors. Our management recognizes that items such as amortization of intangibles can have a material impact on our cash flows and/or our net income. Our GAAP financial statements including our statement of cash flows portray those effects. Although we believe it is useful for investors to see core performance free of special items, investors should understand that the excluded items are actual expenses that may impact the cash available to us for other uses. To gain a complete picture of all effects on the company’s profit and loss from any and all events, management does (and investors should) rely upon the GAAP income statement. The non-GAAP numbers focus instead upon the core business of the company, which is only a subset, albeit a critical one, of the company’s performance. Readers are reminded that non-GAAP numbers are merely a supplement to, and not a replacement for, GAAP financial measures. They should be read in conjunction with the GAAP financial measures. It should be noted as well that our non- GAAP information may be different from the non-GAAP information provided by other companies. Pension settlement loss relates to the relief of the US Retirement Plan pension obligation due to increased lump sum payouts over a specified accounting threshold. Net (gain) loss on equity securities relates to the realized and unrealized mark-to-market adjustments for our marketable and non-marketable equity securities. Other includes certain legal costs and settlements, special compliance costs, acceleration of stock-based compensation expense and other miscellaneous adjustments. (a) The adjustment for taxes excludes tax expense (benefits) that management believes are not directly related to on-going operations and which are either isolated or cannot be expected to occur again with any regularity or predictability. For the years ended October 31, 2024 and October 31, 2020, management used a non-GAAP effective tax rate of 12.50% and 15.25%, respectively. Historical amounts are reclassified to conform with current presentation. We provide non-GAAP net income and non-GAAP net income per share amounts in order to provide meaningful supplemental information regarding our operational performance and our prospects for the future. These supplemental measures exclude, among other things, charges related to restructuring and other related costs, asset impairments, amortization of intangibles, transformational initiatives, acquisition and integration costs, pension settlement loss and net (gain) loss on equity securities. Asset impairments include assets that have been written-down to their fair value. Restructuring and other related costs include incremental expenses incurred in the period associated with restructuring programs, usually aimed at changes in business and/or cost structure. Such costs may include one-time termination benefits, facility-related costs and contract termination fees. AGILENT TECHNOLOGIES, INC. NON-GAAP NET INCOME AND DILUTED EPS RECONCILIATIONS (In millions, except per share data) (Unaudited) FY24
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FY24 FY23 FY22 FY21 FY20 Total Net cash provided by operating activities $ 1,751 $ 1,772 $ 1,312 $ 1,485 $ 921 $ 7,241 Less: Payments to acquire property, plant and equipment (378) (298) (291) (188) (119) (1,274) Free cash flows 1,373$ 1,474$ 1,021$ 1,297$ 802$ 5,967$ GAAP net income 1,289$ 1,240 1,254 1,210 719$ 5,712$ Non-GAAP adjustments: Restructuring and other related costs 76 46 — — — 122 Asset impairments 19 277 — 2 99 397 Intangible amortization 102 139 191 194 184 810 Transformational initiatives 11 25 30 37 53 156 Acquisition and integration costs 12 16 25 41 41 135 Business exit and divestiture costs (gain) — (43) 7 5 — (31) Pension settlement loss 2 4 4 1 4 15 Net (gain) loss on equity securities (1) 42 63 (92) (28) (16) Change in vair value of contingent consideration — 1 (25) (21) — (45) Loss on extinguishment of debt — — 9 17 — 26 Other 17 20 12 9 12 70 Adjustment for taxes 12 (158) (5) (71) (61) (283) Non-GAAP net income 1,539$ 1,609$ 1,565$ 1,332$ 1,023$ 7,068$ Free cash flows to non-GAAP net income ratio 84% Page 4 AGILENT TECHNOLOGIES, INC. RECONCILIATION OF FREE CASH FLOWS TO NON-GAAP NET INCOME RATIO (in millions, except ratio data) (Unaudited)