PerkinElmer Announces Financial Results for the Third Quarter of 2009

http://www.businesswire.com/news/home/20091029006463/en

-- Revenue of $437 million, in-line with expectations; End markets stabilizing

-- GAAP earnings per share of $0.14; Adjusted EPS of $0.30 exceeds guidance

-- Expanded capabilities in Diagnostics and Research Reagents
WALTHAM, Mass.--(Business Wire)--
PerkinElmer, Inc. (NYSE: PKI), a global leader focused on improving the health
and safety of people and the environment, today reported financial results for
the third quarter ended October 4, 2009. The Company reported GAAP earnings per
share from continuing operations of $0.14, down from the same period a year ago,
primarily due to restructuring charges in the third quarter of 2009 and the
benefit of tax audit settlements in the same period a year ago. On a non-GAAP
basis, which includes the adjustments noted in the attached reconciliation, the
Company announced adjusted earnings per share of $0.30, exceeding the Company`s
prior guidance of $0.25-$0.27.

Revenue from continuing operations in the third quarter of 2009 was $437.1
million, a decrease of 9% as compared to the same period a year ago. Foreign
exchange rates had an unfavorable impact of 2% and acquisitions had a favorable
impact of 1%. Organic revenue, which includes the adjustments noted in the
attached reconciliation, declined by 8% as compared to the third quarter of
2008. Revenue from continuing operations in the Human Health and Environmental
Health segments decreased by 8% and 9%, respectively, as compared to the same
period a year ago. As compared to the third quarter of 2008, organic revenue in
the Human Health segment declined by 7% and organic revenue in the Environmental
Health segment declined by 8%.

GAAP operating profit from continuing operations for the third quarter of 2009
was $26.4 million, as compared to $43.1 million for the same period a year ago.
On a non-GAAP basis, which includes the adjustments noted in the attached
reconciliation, adjusted operating profit was $54.6 million, as compared to
$64.2 million in the third quarter of 2008.

GAAP earnings per share from continuing operations for the third quarter of 2009
was $0.14, as compared to $0.35 for the same period in 2008. On a non-GAAP
basis, which includes the adjustments noted in the attached reconciliation,
adjusted earnings per share was $0.30 as compared to $0.34 in the third quarter
of 2008. Operating cash flow from continuing operations was $35.7 million in the
third quarter of 2009, as compared to $22.3 million in the third quarter of
2008.

Financial Overview by Reporting Segment

Human Health reported revenue of $180.2 million for the third quarter of 2009.
The segment`s GAAP operating profit was $18.9 million, compared to $21.4 million
for the same period a year ago. On a non-GAAP basis, which includes the
adjustments noted in the attached reconciliation, the segment`s adjusted
operating profit was $34.2 million, as compared to $35.9 million in the third
quarter of 2008. As a percentage of revenue, the segment`s adjusted operating
profit was 19.0%, an increase of approximately 80 basis points as compared to
the third quarter of 2008.

During the third quarter of 2009, the Company acquired SYM-BIO LifeScience and
Surendra Genetic Labs, which expanded the Company's maternal and newborn
diagnostics business while increasing access to advanced health screening in
China and India. Additionally, the Company purchased certain assets from GE
Healthcare, solidifying its leading position in radiochemical research
consumables.

Environmental Health reported revenue of $256.9 million for the third quarter of
2009. The segment`s GAAP operating profit was $15.5 million, compared to $30.5
million for the same period a year ago. On a non-GAAP basis, which includes the
adjustments noted in the attached reconciliation, the segment`s adjusted
operating profit was $28.3 million, as compared to $37.1 million in the third
quarter of 2008. As a percentage of revenue, the segment`s adjusted operating
profit was 11.0%, a decrease of approximately 210 basis points as compared to
the third quarter of 2008.

"The organization continues to perform very well through this difficult
environment, improving our operational execution, while building a stronger
company through introducing innovative new products and expanding our
capabilities in key growth areas," said Robert Friel, Chairman and CEO of
PerkinElmer. "Overall we believe our end markets are stabilizing and we are
seeing some encouraging signs of sequential improvement."

Financial Guidance

For the full year 2009, the Company forecasts GAAP earnings per share from
continuing operations in the range of $0.77 to $0.80 and, on a non-GAAP basis,
which includes the adjustments noted in the attached reconciliation, adjusted
earnings per share from continuing operations in the range of $1.23 to $1.26.

Conference Call Information

The Company will discuss its third quarter results and its outlook for business
trends in a conference call on October 29, 2009 at 5:00 p.m. Eastern Time (ET).
To access the call, please dial (617) 597-5376 prior to the scheduled conference
call time and provide the access code 82595541. A replay of this conference call
will be available approximately two hours after the call. The replay phone
number is (617) 801-6888 and the code number is 33651295.

A live audio webcast of the call will be available on the Investor section of
the Company`s Web site, www.perkinelmer.com. Please go to the site at least 15
minutes prior to the call in order to register, download, and install any
necessary software. An archived version of the webcast will be posted on the
Company`s Web site for a two week period beginning approximately two hours after
the call.

Use of Non-GAAP Financial Measures

In addition to financial measures prepared in accordance with generally accepted
accounting principles (GAAP), this earnings announcement also contains non-GAAP
financial measures. The reasons that we use these measures, a reconciliation of
these measures to the most directly comparable GAAP measures, and other
information relating to these measures are included below following our GAAP
financial statements.

Factors Affecting Future Performance

This press release contains "forward-looking" statements within the meaning of
the Private Securities Litigation Reform Act of 1995, including, but not limited
to, statements relating to estimates and projections of future earnings per
share, cash flow and revenue growth and other financial results, developments
relating to our customers and end-markets, and plans concerning business
development opportunities. Words such as "believes," "intends," "anticipates,"
"plans," "expects," "projects," "forecasts," "will" and similar expressions, and
references to guidance, are intended to identify forward-looking statements.
Such statements are based on management's current assumptions and expectations
and no assurances can be given that our assumptions or expectations will prove
to be correct. A number of important risk factors could cause actual results to
differ materially from the results described, implied or projected in any
forward-looking statements. These factors include, without limitation: (1)
markets into which we sell our products decline or do not grow as anticipated;
(2) fluctuations in the global economic and political environments; (3) our
failure to introduce new products in a timely manner; (4) our ability to execute
acquisitions and license technologies, or to successfully integrate acquired
businesses and licensed technologies into our existing business or to make them
profitable; (5) our failure to adequately protect our intellectual property; (6)
the loss of any of our licenses or licensed rights; (7) our ability to compete
effectively; (8) fluctuation in our quarterly operating results and our ability
to adjust our operations to address unexpected changes; (9) significant
disruption in third-party package delivery and import/export services or
significant increases in prices for those services; (10) disruptions in the
supply of raw materials and supplies; (11) the manufacture and sale of products
may expose us to product liability claims; (12) our failure to maintain
compliance with applicable government regulations; (13) regulatory changes; (14)
our failure to comply with healthcare industry regulations; (15) economic,
political and other risks associated with foreign operations; (16) our ability
to retain key personnel; (17) significant disruption in our information
technology systems; (18) restrictions in our credit agreements; (19) our ability
to realize the full value of our intangible assets; (20) significant
fluctuations in our stock price; (21) reduction or elimination of dividends on
our common stock; and (22) other factors which we describe under the caption
"Risk Factors" in our most recent quarterly report on Form 10-Q and in our other
filings with the Securities and Exchange Commission. We disclaim any intention
or obligation to update any forward-looking statements as a result of
developments occurring after the date of this press release.

About PerkinElmer

PerkinElmer, Inc. is a global leader focused on improving the health and safety
of people and the environment. The Company reported revenue of approximately $2
billion in 2008, has around 8,500 employees serving customers in more than 150
countries, and is a component of the S&P 500 Index. Additional information is
available through www.perkinelmer.com or 1-877-PKI-NYSE.

PerkinElmer, Inc. and Subsidiaries
CONSOLIDATED INCOME STATEMENTS

Three Months Ended Nine Months Ended
(In thousands, except per share data) October 4, 2009 September 28, 2008 October 4, 2009 September 28, 2008

Sales $ 437,065 $ 478,747 $ 1,303,214 $ 1,442,432

Cost of sales 249,495 273,124 740,216 829,665
Research and development expenses 27,336 26,192 78,877 82,963
Selling, general and administrative expenses 121,431 129,800 373,807 402,384
Restructuring and lease charges, net 12,383 6,495 20,206 6,190

Operating income from continuing operations 26,420 43,136 90,108 121,230

Interest income (124 ) (1,064 ) (777 ) (3,249 )
Interest expense 4,147 6,371 12,964 18,435
Gains on dispositions of investments, net - - - (1,158 )
Other expense, net 798 742 1,652 2,280

Income from continuing operations before income taxes 21,599 37,087 76,269 104,922

Provision for (benefit from) income taxes 5,578 (4,596 ) 22,232 12,908

Net income from continuing operations 16,021 41,683 54,037 92,014

(Loss) income from discontinued operations, net of income taxes (864 ) 2,075 (4,828 ) 2,747
(Loss) gain on disposition of discontinued operations, net of income taxes (1,568 ) 8,144 (3,556 ) 985

Net income $ 13,589 $ 51,902 $ 45,653 $ 95,746

Diluted earnings (loss) per share:
Continuing operations $ 0.14 $ 0.35 $ 0.46 $ 0.77

(Loss) income from discontinued operations, net of income taxes (0.01 ) 0.02 (0.04 ) 0.02
(Loss) gain on disposition of discontinued operations, net of income taxes (0.01 ) 0.07 (0.03 ) 0.01

Net income $ 0.12 $ 0.43 $ 0.39 $ 0.80

Weighted average diluted shares of common stock outstanding 116,641 119,609 116,487 119,029

ABOVE PREPARED IN ACCORDANCE WITH GAAP

Additional Supplemental Information:
(per share, continuing operations)

GAAP diluted EPS from continuing operations $ 0.14 $ 0.35
Amortization of intangible assets, net of income taxes 0.08 0.08
Purchase accounting adjustments, net of income taxes 0.01 0.00
Tax benefit from audit settlements - (0.12 )
Restructuring and lease charges, net of income taxes 0.07 0.04
Adjusted EPS $ 0.30 $ 0.34

PerkinElmer, Inc. and Subsidiaries
SALES AND OPERATING PROFIT (LOSS)

Three Months Ended Nine Months Ended
(In thousands) October 4, 2009 September 28, 2008 October 4, 2009 September 28, 2008

Human Health Sales $ 180,197 $ 196,697 $ 542,311 $ 580,699
OP$ reported 18,890 21,392 55,646 52,854
OP% reported 10.5% 10.9% 10.3% 9.1%
Amortization of intangible assets 9,958 10,311 29,964 30,718
Purchase accounting adjustments 967 482 2,050 2,771
Restructuring and lease charges, net 4,411 3,682 9,185 3,721
OP$ adjusted 34,226 35,867 96,845 90,064
OP% adjusted 19.0% 18.2% 17.9% 15.5%

Environmental Health Sales 256,868 282,050 760,903 861,733
OP$ reported 15,505 30,512 58,622 98,468
OP% reported 6.0% 10.8% 7.7% 11.4%
Amortization of intangible assets 4,628 3,760 12,046 11,295
Purchase accounting adjustments 199 - 795 -
Restructuring and lease charges, net 7,972 2,813 11,021 2,469
OP$ adjusted 28,304 37,085 82,484 112,232
OP% adjusted 11.0% 13.1% 10.8% 13.0%

Corporate OP$ reported (7,975) (8,768) (24,160) (30,092)

Continuing Operations Sales $ 437,065 $ 478,747 $ 1,303,214 $ 1,442,432
OP$ reported 26,420 43,136 90,108 121,230
OP% reported 6.0% 9.0% 6.9% 8.4%
Amortization of intangible assets 14,586 14,071 42,010 42,013
Purchase accounting adjustments 1,166 482 2,845 2,771
Restructuring and lease charges, net 12,383 6,495 20,206 6,190
OP$ adjusted $ 54,555 $ 64,184 $ 155,169 $ 172,204
OP% adjusted 12.5% 13.4% 11.9% 11.9%

SALES AND REPORTED OPERATING PROFIT PREPARED IN ACCORDANCE WITH GAAP

PerkinElmer, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS

(In thousands) October 4, 2009 December 28, 2008

Current assets:
Cash and cash equivalents $ 150,586 $ 179,110
Accounts receivable, net 348,399 327,636
Inventories, net 224,427 197,967
Other current assets 110,489 111,087
Current assets of discontinued operations 17,363 14,947
Total current assets 851,264 830,747

Property, plant and equipment, net:
At cost 608,858 570,257
Accumulated depreciation (397,503 ) (365,843 )
Property, plant and equipment, net 211,355 204,414
Marketable securities and investments 2,190 3,459
Intangible assets, net 474,614 452,473
Goodwill 1,473,547 1,396,292
Other assets, net 41,370 38,760
Long-term assets of discontinued operations 4,446 5,622
Total assets $ 3,058,786 $ 2,931,767

Current liabilities:
Short-term debt $ 146 $ 40
Accounts payable 158,957 169,447
Accrued restructuring and integration costs 17,585 5,904
Accrued expenses 318,952 323,815
Current liabilities of discontinued operations 17,288 17,036
Total current liabilities 512,928 516,242

Long-term debt 576,734 509,040
Long-term liabilities 364,267 335,354
Long-term liabilities of discontinued operations 3,099 3,188
Total liabilities 1,457,028 1,363,824

Commitments and contingencies

Total stockholders' equity 1,601,758 1,567,943
Total liabilities and stockholders' equity $ 3,058,786 $ 2,931,767

PREPARED IN ACCORDANCE WITH GAAP

PerkinElmer, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended Nine Months Ended
October 4, 2009 September 28, 2008 October 4, 2009 September 28, 2008
(In thousands)

Operating activities:
Net income $ 13,589 $ 51,902 $ 45,653 $ 95,746
Add: loss (income) from discontinued operations, net of income taxes 864 (2,075 ) 4,828 (2,747 )
Add: loss (gain) on disposition of discontinued operations, net of income taxes 1,568 (8,144 ) 3,556 (985 )
Net income from continuing operations 16,021 41,683 54,037 92,014
Adjustments to reconcile net income from continuing operations
to net cash provided by continuing operations:
Stock-based compensation 2,641 5,399 10,806 13,671
Restructuring and lease charges, net 12,383 6,495 20,206 6,190
Amortization of deferred debt issuance costs 635 634 1,905 1,431
Depreciation and amortization 23,196 22,517 67,075 66,433
Amortization of acquired inventory revaluation 285 - 500 -
Gains on dispositions, net - - - (1,158 )
Changes in operating assets and liabilities:
Accounts receivable, net (8,973 ) (14,097 ) (11,733 ) (6,898 )
Inventories, net (2,210 ) (4,352 ) (16,326 ) (16,113 )
Accounts payable 2,180 (7,453 ) (12,543 ) (1,136 )
Accrued expenses and other (10,504 ) (28,550 ) (20,063 ) (35,412 )
Net cash provided by operating activities of continuing operations 35,654 22,276 93,864 119,022
Net cash (used in) provided by operating activities of discontinued operations (1,252 ) 10,131 (8,242 ) 8,247
Net cash provided by operating activities 34,402 32,407 85,622 127,269

Investing activities:
Capital expenditures (7,792 ) (13,726 ) (20,839 ) (31,622 )
Changes in restricted cash balances - 334 1,412 334
Payments for business development activity - (12 ) - (160 )
Proceeds from disposition of investments, net - - - 1,158
Payments for acquisitions and investments, net of cash and cash equivalents acquired (73,468 ) (894 ) (122,690 ) (87,252 )
Net cash used in investing activities of continuing operations (81,260 ) (14,298 ) (142,117 ) (117,542 )
Net cash used in investing activities of discontinued operations (840 ) (291 ) (1,015 ) (1,864 )
Net cash used in investing activities (82,100 ) (14,589 ) (143,132 ) (119,406 )

Financing Activities:
Payments on debt (92,000 ) (21,000 ) (277,611 ) (531,500 )
Proceeds from borrowings 142,500 44,000 339,500 409,500
Proceeds from the sale of senior subordinated debt - - - 150,000
Payments of debt issuance costs - (128 ) (7 ) (1,969 )
Settlement of cash flow hedges - - - (11,702 )
Proceeds from (payments on) other credit facilities 2 (12 ) (79 ) (511 )
Tax benefit from exercise of common stock options 5 251 30 359
Proceeds from issuance of common stock under stock plans 183 25,067 2,262 43,435
Purchases of common stock (32 ) (56,731 ) (14,619 ) (57,139 )
Dividends paid (8,170 ) (8,318 ) (24,528 ) (24,805 )
Net cash provided by (used in) financing activities 42,488 (16,871 ) 24,948 (24,332 )

Effect of exchange rate changes on cash and cash equivalents 4,457 (5,590 ) 4,038 1,929

Net decrease in cash and cash equivalents (753 ) (4,643 ) (28,524 ) (14,540 )
Cash and cash equivalents at beginning of period 151,339 193,451 179,110 203,348
Cash and cash equivalents at end of period $ 150,586 $ 188,808 $ 150,586 $ 188,808

PREPARED IN ACCORDANCE WITH GAAP

PerkinElmer, Inc. and Subsidiaries
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

PKI
Three Months Ended
September 09 September 08
Adjusted gross margin:
GAAP gross margin $ 187.6 42.9 % $ 205.6 43.0 %
Amortization of intangible assets 9.5 2.2 % 9.5 2.0 %
Purchase accounting adjustments 0.5 0.1 % 0.5 0.1 %
Adjusted gross margin $ 197.5 45.2 % $ 215.6 45.0 %

Adjusted SG&A:
GAAP SG&A $ 121.4 27.8 % $ 129.8 27.1 %
Amortization of intangible assets (4.5 ) -1.0 % (4.1 ) -0.9 %
Purchase accounting adjustments (0.7 ) -0.2 % - 0.0 %
Adjusted SG&A $ 116.2 26.6 % $ 125.7 26.3 %

Adjusted R&D:
GAAP R&D $ 27.3 6.3 % $ 26.2 5.5 %
Amortization of intangible assets (0.5 ) -0.1 % (0.5 ) -0.1 %
Adjusted R&D $ 26.8 6.1 % $ 25.7 5.4 %

Adjusted operating profit:
GAAP operating profit $ 26.4 6.0 % $ 43.1 9.0 %
Amortization of intangible assets 14.6 3.3 % 14.1 2.9 %
Purchase accounting adjustments 1.2 0.3 % 0.5 0.1 %
Restructuring and lease charges, net 12.4 2.8 % 6.5 1.4 %
Adjusted operating profit $ 54.6 12.5 % $ 64.2 13.4 %

PKI
Three Months Ended
September 09 September 08
Adjusted EPS:
GAAP EPS $ 0.12 $ 0.43
Discontinued operations (0.02 ) 0.09
GAAP EPS from continuing operations $ 0.14 $ 0.35
Amortization of intangible assets, net of income taxes 0.08 0.08
Purchase accounting adjustments, net of income taxes 0.01 0.00
Tax benefit from audit settlements - (0.12 )
Restructuring and lease charges, net of income taxes 0.07 0.04
Adjusted EPS $ 0.30 $ 0.34

PKI

FY 09 FY 08

Adjusted EPS: Projected
GAAP EPS $ 0.70 - $0.73 $ 1.07
Discontinued operations (0.07 ) 0.01
GAAP EPS from continuing operations $ 0.77 - $0.80 $ 1.06
Amortization of intangible assets, net of income taxes 0.32 0.30
Discontinuance of interest rate contract related to acquisition financing, net of income taxes - 0.09
Purchase accounting adjustments, net of income taxes 0.02 0.02
Tax benefit from audit settlements - (0.12 )
Restructuring and lease charges, net of income taxes 0.12 0.04
Adjusted EPS $ 1.23 - $1.26 $ 1.39

Human Health
Three Months Ended
September 09 September 08
Adjusted operating profit:
GAAP operating profit $ 18.9 10.5 % $ 21.4 10.9 %
Amortization of intangible assets 10.0 5.5 % 10.3 5.2 %
Purchase accounting adjustments 1.0 0.5 % 0.5 0.2 %
Restructuring and lease charges, net 4.4 2.4 % 3.7 1.9 %
Adjusted operating profit $ 34.2 19.0 % $ 35.9 18.2 %

Environmental Health
Three Months Ended
September 09 September 08
Adjusted operating profit:
GAAP operating profit $ 15.5 6.0 % $ 30.5 10.8 %
Amortization of intangible assets 4.6 1.8 % 3.8 1.3 %
Purchase accounting adjustments 0.2 0.1 % - 0.0 %
Restructuring and lease charges, net 8.0 3.1 % 2.8 1.0 %
Adjusted operating profit $ 28.3 11.0 % $ 37.1 13.1 %

PerkinElmer, Inc. and Subsidiaries
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

PKI
Q309
Organic revenue growth:
Reported revenue growth -9%
Less: effect of foreign exchange rates -2%
Less: effect of acquisitions 1%
Organic revenue growth -8%

Human Health
Q309
Organic revenue growth:
Reported revenue growth -8%
Less: effect of foreign exchange rates -2%
Less: effect of acquisitions 1%
Organic revenue growth -7%

Environmental Health
Q309
Organic revenue growth:
Reported revenue growth -9%
Less: effect of foreign exchange rates -2%
Less: effect of acquisitions 1%
Organic revenue growth -8%

Organic Revenue and Organic Revenue Growth

We use the term "organic revenue" to refer to GAAP revenue, excluding the effect
of foreign currency translation and acquisitions. We use the related term
"organic revenue growth" to refer to the measure of comparing current period
organic revenue with the corresponding period of the prior year. We believe that
these non-GAAP measures, when taken together with our GAAP financial measures,
allow us and our investors to better measure the performance of our investments
in technology, to evaluate the long-term performance trends and to assess our
ability to invest in the business. Organic revenue growth also provides for
easier comparisons of our performance with prior and future periods and relative
comparisons to our peers. We exclude the effect of foreign currency translation
from these measures because foreign currency translation is subject to
volatility and can obscure underlying trends. We exclude the effect of
acquisitions because acquisition activity can vary dramatically between
reporting periods and between us and our peers, which we believe makes
comparisons of long-term performance trends difficult for management and
investors, and could result in overstating or understating to our investors the
performance of our operations.

Adjusted Gross Margin and Adjusted Gross Margin Percentage

We use the term "adjusted gross margin" to refer to GAAP gross margin, excluding
amortization of intangible assets, and inventory fair value adjustments related
to business acquisitions, and including estimated revenue from contracts
acquired in the acquisition of ViaCell, Inc., or ViaCell, that will not be fully
recognized due to business combination accounting rules. We use the related term
"adjusted gross margin percentage" to refer to adjusted gross margin as a
percentage of GAAP revenue. We believe that these non-GAAP measures, when taken
together with our GAAP financial measures, allow us and our investors to better
measure the performance of our investments in technology, to evaluate the
long-term profitability trends and to assess our ability to invest in the
business. We exclude amortization of intangible assets from these measures
because intangibles amortization charges do not represent what our management
and what we believe our investors consider to be costs of producing our products
and could distort the additional value generated over the cost of producing
those products. In addition, inventory fair value adjustments related to
business acquisitions charges also do not represent what our management and what
we believe our investors consider to be costs used in producing our products. We
include estimated revenue from contracts acquired in the ViaCell acquisition
that will not be fully recognized because our GAAP revenue for the periods
subsequent to our acquisition do not reflect the full amount of storage revenue
on these contracts that would have otherwise been recorded by ViaCell. The
non-GAAP adjustment is intended to reflect the full amount of such revenue. Our
management and we believe our investors will use this adjustment as a measure of
the ongoing performance of the ViaCell business because customers have
historically renewed these contracts, although there can be no assurance that
customers will do so in the future.

Adjusted Selling, General and Administrative (SG&A) Expense and Adjusted SG&A
Percentage

We use the term "adjusted SG&A expense" to refer to GAAP SG&A expense, excluding
amortization of intangible assets, and contingent consideration and other costs
related to business acquisitions. We use the related term "adjusted SG&A
percentage" to refer to adjusted SG&A expense as a percentage of GAAP revenue.
We believe that these non-GAAP measures, when taken together with our GAAP
financial measures, allow us and our investors to better measure the cost of the
internal operating structure, our ability to leverage that structure and the
level of investment required to grow our business. We exclude amortization of
intangible assets and contingent consideration and other costs related to
business acquisitions from these measures because intangibles amortization
charges and contingent consideration and other costs related to business
acquisitions do not represent what our management and what we believe our
investors consider to be costs that support our internal operating structure and
could distort the efficiencies of that structure.

Adjusted Research and Development (R&D) Expense and Adjusted R&D Percentage

We use the term "adjusted R&D expense" to refer to GAAP R&D expense, excluding
amortization of intangible assets. We use the related term "adjusted R&D
percentage" to refer to adjusted R&D expense as a percentage of GAAP revenue. We
believe that these non-GAAP measures, when taken together with our GAAP
financial measures, allow us and our investors to better understand and evaluate
our internal technology investments. We exclude amortization of intangible
assets from these measures because intangibles amortization charges do not
represent what our management and what we believe our investors consider to be
internal investments in R&D activities and could distort our R&D investment
level.

Adjusted Operating Profit and Adjusted Operating Profit Margin

We use the term "adjusted operating profit" to refer to GAAP operating profit,
excluding amortization of intangible assets, inventory fair value adjustments
related to business acquisitions, contingent consideration and other costs
related to business acquisitions, and restructuring and lease charges, and
including estimated revenue from contracts acquired in the ViaCell acquisition
that will not be fully recognized due to business combination accounting rules.
Adjusted operating profit is calculated by subtracting adjusted R&D expense,
adjusted SG&A expense, and restructuring and lease charges from adjusted gross
margin. We use the related term "adjusted operating profit margin" to refer to
adjusted operating profit as a percentage of GAAP revenue. We believe that these
non-GAAP measures, when taken together with our GAAP financial measures, allow
us and our investors to analyze the costs of the different components of
producing and selling our products, to better measure the performance of our
internal investments in technology and to evaluate the long-term profitability
trends of our core operations. Adjusted operating profit also provides for
easier comparisons of our performance and profitability with prior and future
periods and relative comparisons to our peers. We believe our investors do not
consider the items that we exclude from adjusted operating profit to be costs of
producing our products, investments in technology and production, and costs to
support our internal operating structure, and so we present this non-GAAP
measure to avoid overstating or understating to our investors the performance of
our operations. We exclude restructuring and lease charges because they tend to
occur due to an acquisition, divestiture, repositioning of the business or other
unusual event that could distort the performance measures of our internal
investments and costs to support our internal operating structure. We include
estimated revenue from contracts acquired in the ViaCell acquisition that will
not be fully recognized because our GAAP revenue for the periods subsequent to
our acquisition do not reflect the full amount of storage revenue on these
contracts that would have otherwise been recorded by ViaCell. The non-GAAP
adjustment is intended to reflect the full amount of such revenue. Our
management and we believe our investors will use this adjustment as a measure of
the ongoing performance of the ViaCell business because customers have
historically renewed these contracts, although there can be no assurance that
customers will do so in the future.

Adjusted Earnings per Share

We use the term "adjusted earnings per share," or "adjusted EPS," to refer to
GAAP earnings per share, excluding discontinued operations, amortization of
intangible assets, inventory fair value adjustments related to business
acquisitions, contingent consideration and other costs related to business
acquisitions, restructuring and lease charges, and income from significant tax
audit settlements, and including estimated revenue from contracts acquired in
the ViaCell acquisition that will not be fully recognized due to business
combination accounting rules. Adjusted earnings per share is calculated by
subtracting adjusted R&D expense, adjusted SG&A expense, restructuring and lease
charges, other income/expense and provision for taxes from adjusted gross
margin. We believe that this non-GAAP measure, when taken together with our GAAP
financial measures, allows us and our investors to analyze the costs of
producing and selling our products and the performance of our internal
investments in technology and our internal operating structure, to evaluate the
long-term profitability trends of our core operations and to calculate the
underlying value of the core business on a dilutive share basis, which is a key
measure of the value of the Company used by our management and we believe used
by investors as well. Adjusted earnings per share also facilitates the overall
analysis of the value of the Company and the core measure of the success of our
operating business model as compared to prior and future periods and relative
comparisons to our peers. We exclude discontinued operations, amortization of
intangible assets, inventory fair value adjustments related to business
acquisitions, contingent consideration and other costs related to business
acquisitions, restructuring and lease charges and income from significant tax
audit settlements, as these items do not represent what our management and what
we believe our investors consider to be costs of producing our products,
investments in technology and production, and costs to support our internal
operating structure, which could result in overstating or understating to our
investors the performance of our operations. We include estimated revenue from
contracts acquired in the ViaCell acquisition that will not be fully recognized
because our GAAP revenue for the periods subsequent to our acquisition do not
reflect the full amount of storage revenue on these contracts that would have
otherwise been recorded by ViaCell. The non-GAAP adjustment is intended to
reflect the full amount of such revenue. Our management and we believe our
investors will use this adjustment as a measure of the ongoing performance of
the ViaCell business because customers have historically renewed these
contracts, although there can be no assurance that customers will do so in the
future.

***

The non-GAAP financial measures described above are not meant to be considered
superior to, or a substitute for, our financial statements prepared in
accordance with GAAP. There are material limitations associated with non-GAAP
financial measures because they exclude charges that have an effect on our
reported results and, therefore, should not be relied upon as the sole financial
measures to evaluate our financial results. Management compensates and believes
that investors should compensate for these limitations by viewing the non-GAAP
financial measures in conjunction with the GAAP financial measures. In addition,
the non-GAAP financial measures included in this earnings announcement may be
different from, and therefore may not be comparable to, similar measures used by
other companies.

Each of the non-GAAP financial measures listed above are also used by our
management to evaluate our operating performance, communicate our financial
results to our Board of Directors, benchmark our results against our historical
performance and the performance of our peers, evaluate investment opportunities
including acquisitions and discontinued operations, and determine the bonus
payments for senior management and employees.

Investor Relations:
PerkinElmer, Inc.
David C. Francisco, 781-663-5677
dave.francisco@perkinelmer.com
or
Media Contact:
PerkinElmer, Inc.
Stephanie R. Wasco, 781-663-5701
stephanie.wasco@perkinelmer.com
or
Additional Media Contact:
Porter Novelli
Kate Weiss, 617-897-8255
kweiss@pnlifesciences.com

Copyright Business Wire 2009