Global lab chemical and life sciences company
Sigma-Aldrich Corporation
(
SIAL
) announced an extension of its catalyst distribution agreement
with Materia, Inc for another 10 years. As per the new agreement,
Aldrich Chemical Co. LLC will continue to market patented-Materia
Grubbs Catalyst across the world.
Materia, a catalyst technology company, believes that the agreement
with Sigma-Aldrich is a win-win situation for them as the strong
network of Sigma-Aldrich enables catalyst to cater to the chemical,
polymer and pharmaceutical industries. Currently, Aldrich Chemical
sells fifteen Materia metathesis catalysts based on patents
approved by the California Institute of Technology, as well as
other technology from Materia, Boston College, the University of
Calgary and the University of New Orleans.
Last month, Sigma-Aldrich posted adjusted earnings of 97 cents
per share for the second quarter of 2012, meeting the Zacks
Consensus Estimate but exceeding the year-ago earnings of 93 cents.
Profit, as reported, inched slightly higher to $115 million or 94
cents per share in the quarter from $113 million or 91 cents a year
ago.
Revenues came in at $664 million in the quarter, up 4% year over
year, but below the Zacks Consensus Estimate of $673 million.
Acquisitions added 6% to the growth while foreign exchange
translation had an unfavorable impact of 5%. The company saw growth
across its Research Chemicals and Fine Chemicals ("SAFC")
divisions.
Moving ahead, Sigma-Aldrich expects organic growth to be in
low-to-mid single digits in 2012, down from the earlier expectation
of mid single-digits. Macroeconomic uncertainties might hinder its
Research Chemicals business whereas growth in Bioscience and Hitech
is expected to drive SAFC sales for the remainder of the year. The
acquisitions of BioReliance and Research Organics are expected to
boost sales by 6%.
Sigma-Aldrich lowered its earnings guidance for the year as the
company expects sales from the Research Chemicals business (which
constitutes two-third of its revenues) to slowdown in the second
half of the year. The company now expects adjusted earnings of
$3.80 to $3.90 per share in 2012, down from the earlier range of
$3.90 to $4.05. BioReliance and Research Organics acquisitions are
expected to add roughly 5 cents to 7 cents a share to earnings in
2012.
The company, which competes with
Bayer AG
(
BAYRY
) and other privately held companies, such as Brenntag AG and VWR
Funding Inc., maintains a Zacks #4 Rank, which translates into a
short-term (1 to 3 months) Sell rating.
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