Sigma Aldrich’s fine chemicals manufacturing section SAFC ensured a modest growth for the company although its “weak” research business in the US and the EU has stunted any drastic figures, according to analysts.
The earnings showed revenues for the quarter had increased by 4 per cent from $637m to $664m year-on-year – more than $10m below analyst expectations.
According to Tim Evans, senior analyst at Wells Fargo, the “weakness” lies particularly within “US and Europe pharma customers.”
He said deterioration in global macroeconomic variables, especially in Europe, pressure on biopharmaceutical R&D and capex budgets and increasing competition in the field have all played a part in the downturn.
Evans added that “declining budgets for government-sponsored research, especially the NIH (National Institute of Health)” is also a culprit.
SAFC, however, enjoyed £223m in sales, “a new quarterly record”, beating last year’s performance by an unexpected eight per cent.
CEO Rakesh Sachdev heralded the custom pharma business as a key driving factor.
“Based on the solid first half of 2012 results and visibility for accelerated sales growth, we are reaffirming our guidance for low double digit organic growth for SAFC sales in the second half of 2012,” he said.
Never leave a soldier behind?
Nevertheless, though the firm’s research section is flagging in comparison with its increasingly successful manufacturing business, it is still backing its research business.
Following the results, it launched a new micron particle size column named Ascentis Express C18, 5 to boost efficiency in high purity liquid chomatography (HPLC) procedures.
"The latest extension to the Ascentis Express line allows scientists to boost the performance of legacy HPLC systems and effortlessly transfer methods amongst sites or contract research organizations (CRO) without incompatibility concerns," said Wayne Way, HPLC/GC market segment manager, for the Supelco brand.