☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 13-3668640 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common Stock, par value $0.01 per share | WAT | New York Stock Exchange, Inc. |
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
Emerging growth company | ☐ |
Page | ||||||
PART I | FINANCIAL INFORMATION | |||||
Item 1. | ||||||
3 | ||||||
4 | ||||||
5 | ||||||
6 | ||||||
7 | ||||||
8 | ||||||
Item 2. | ||||||
Item 3. | 36 | |||||
Item 4. | Controls and Procedures | 36 | ||||
PART II | ||||||
Item 1. | Legal Proceedings | 37 | ||||
Item 1A. | 37 | |||||
37 | ||||||
Item 6. | Exhibits | 38 | ||||
39 | ||||||
Item 1: | Financial Statements |
April 2, 2022 | December 31, 2021 | |||||||||||||||
April 3, 2021 | December 31, 2020 | |||||||||||||||
(In thousands, except per share data) | (In thousands, except per share data) | |||||||||||||||
ASSETS | ||||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 683,783 | $ | 436,695 | $ | 480,070 | $ | 501,234 | ||||||||
Investments | 125,986 | 6,451 | 23,025 | 68,051 | ||||||||||||
Accounts receivable, net | 550,677 | 573,316 | 607,262 | 612,648 | ||||||||||||
Inventories | 327,967 | 304,281 | 381,902 | 356,095 | ||||||||||||
Other current assets | 79,510 | 80,290 | 92,915 | 90,914 | ||||||||||||
Total current assets | 1,767,923 | 1,401,033 | 1,585,174 | 1,628,942 | ||||||||||||
Property, plant and equipment, net | 513,719 | 494,003 | 547,199 | 547,913 | ||||||||||||
Intangible assets, net | 240,853 | 258,645 | 236,408 | 242,401 | ||||||||||||
Goodwill | 438,139 | 444,362 | 435,807 | 437,865 | ||||||||||||
Operating lease assets | 88,283 | 93,252 | 86,944 | 84,734 | ||||||||||||
Other assets | 162,646 | 148,625 | 149,737 | 153,077 | ||||||||||||
Total assets | $ | 3,211,563 | $ | 2,839,920 | $ | 3,041,269 | $ | 3,094,932 | ||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Notes payable and debt | $ | 100,000 | $ | 150,000 | ||||||||||||
Accounts payable | 81,511 | 72,212 | 93,235 | 96,799 | ||||||||||||
Accrued employee compensation | 35,104 | 72,166 | 33,770 | 101,192 | ||||||||||||
Deferred revenue and customer advances | 280,848 | 198,240 | 315,086 | 227,561 | ||||||||||||
Current operating lease liabilities | 26,908 | 27,764 | 26,089 | 27,906 | ||||||||||||
Accrued income taxes | 82,642 | 76,558 | 82,634 | 61,278 | ||||||||||||
Accrued warranty | 10,705 | 10,950 | 10,212 | 10,718 | ||||||||||||
Other current liabilities | 167,331 | 197,093 | 126,803 | 155,054 | ||||||||||||
Total current liabilities | 785,049 | 804,983 | 687,829 | 680,508 | ||||||||||||
Long-term liabilities: | ||||||||||||||||
Long-term debt | 1,603,090 | 1,206,515 | 1,444,122 | 1,513,870 | ||||||||||||
Long-term portion of retirement benefits | 72,756 | 72,620 | 58,442 | 64,027 | ||||||||||||
Long-term income tax liabilities | 357,824 | 357,493 | 319,896 | 319,547 | ||||||||||||
Long-term operating lease liabilities | 61,503 | 68,197 | 61,129 | 59,623 | ||||||||||||
Other long-term liabilities | 100,379 | 97,968 | 94,914 | 89,803 | ||||||||||||
Total long-term liabilities | 2,195,552 | 1,802,793 | 1,978,503 | 2,046,870 | ||||||||||||
Total liabilities | 2,980,601 | 2,607,776 | 2,666,332 | 2,727,378 | ||||||||||||
Commitments and contingencies (Notes 6 ,7 and 11 ) | 0 | 0 | ||||||||||||||
Commitments and contingencies (Notes 6, 7, 8 and 11) | 0 | 0 | ||||||||||||||
Stockholders’ equity: | ||||||||||||||||
Preferred stock, par value $0.01 per share, 5,000 shares authorized, NaN issued at April 3, 2021 and December 31, 2020 | 0 | 0— | ||||||||||||||
Common stock, par value $0.01 per share, 400,000 shares authorized, 161,859 and 161,666 shares issued, 61,847 and 62,309 shares outstanding at April 3, 2021 and December 31, 2020, respectively | 1,619 | 1,617 | ||||||||||||||
Preferred stock, par value $0.01 per share, 5,000 shares authorized, NaN issued at April 2, 2022 and December 31, 2021 | 0 | 0 | ||||||||||||||
Common stock, par value $0.01 per share, 400,000 shares authorized, 162,252 and 162,084 shares issued, 60,372 and 60,728 shares outstanding at April 2, 2022 and December 31, 2021, respectively | 1,623 | 1,621 | ||||||||||||||
Additional paid-in capital | 2,054,076 | 2,029,465 | 2,138,426 | 2,114,880 | ||||||||||||
Retained earnings | 7,256,116 | 7,107,989 | 7,960,663 | 7,800,832 | ||||||||||||
Treasury stock, at cost, 100,012 and 99,357 shares at April 3, 2021 and December 31, 2020, respectively | (8,969,643 | ) | (8,788,984 | ) | ||||||||||||
Treasury stock, at cost, 101,880 and 101,356 shares at April 2, 2022 and December 31, 2021, respectively | (9,608,050 | ) | (9,437,914 | ) | ||||||||||||
Accumulated other comprehensive loss | (111,206 | ) | (117,943 | ) | (117,725 | ) | (111,865 | ) | ||||||||
Total stockholders’ equity | 230,962 | 232,144 | 374,937 | 367,554 | ||||||||||||
Total liabilities and stockholders’ equity | $ | 3,211,563 | $ | 2,839,920 | $ | 3,041,269 | $ | 3,094,932 | ||||||||
Three Months Ended | ||||||||||||||||
Three Months Ended | April 2, 2022 | April 3, 2021 | ||||||||||||||
April 3, 2021 | March 28, 2020 | |||||||||||||||
(In thousands, except per share data) | (In thousands, except per share data) | |||||||||||||||
Revenues: | ||||||||||||||||
Product sales | $ | 382,022 | $ | 274,183 | $ | 450,840 | $ | 382,022 | ||||||||
Service sales | 226,523 | 190,756 | 239,732 | 226,523 | ||||||||||||
Total net sales | 608,545 | 464,939 | 690,572 | 608,545 | ||||||||||||
Costs and operating expenses: | ||||||||||||||||
Cost of product sales | 158,876 | 119,839 | 191,610 | 158,876 | ||||||||||||
Cost of service sales | 95,271 | 90,805 | 94,075 | 95,271 | ||||||||||||
Selling and administrative expenses | 143,196 | 147,735 | 157,475 | 143,196 | ||||||||||||
Research and development expenses | 38,092 | 34,989 | 40,472 | 38,092 | ||||||||||||
Purchased intangibles amortization | 1,840 | 2,625 | 1,673 | 1,840 | ||||||||||||
Litigation provision | 0 | 666 | ||||||||||||||
Acquired in-process research and development | 9,797 | — | ||||||||||||||
Total costs and operating expenses | 437,275 | 396,659 | 495,102 | 437,275 | ||||||||||||
Operating income | 171,270 | 68,280 | 195,470 | 171,270 | ||||||||||||
Other income (expense ), net | 9,359 | (374 | ) | |||||||||||||
Other income, net | 170 | 9,359 | ||||||||||||||
Interest expense | (10,946 | ) | (14,079 | ) | (11,059 | ) | (10,946 | ) | ||||||||
Interest income | 4,101 | 4,036 | 2,114 | 4,101 | ||||||||||||
Income before income taxes | 173,784 | 57,863 | 186,695 | 173,784 | ||||||||||||
Provision for income taxes | 25,657 | 4,301 | 26,864 | 25,657 | ||||||||||||
Net income | $ | 148,127 | $ | 53,562 | $ | 159,831 | $ | 148,127 | ||||||||
Net income per basic common share | $ | 2.38 | $ | 0.86 | $ | 2.64 | $ | 2.38 | ||||||||
Weighted-average number of basic common shares | 62,260 | 62,232 | 60,580 | 62,260 | ||||||||||||
Net income per diluted common share | $ | 2.37 | $ | 0.86 | $ | 2.62 | $ | 2.37 | ||||||||
Weighted-average number of diluted common shares and equivalents | 62,632 | 62,626 | 60,952 | 62,632 |
Three Months Ended | ||||||||||||||||
Three Months Ended | April 2, 2022 | April 3, 2021 | ||||||||||||||
April 3, 2021 | March 28, 2020 | |||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||
Net income | $ | 148,127 | $ | 53,562 | $ | 159,831 | $ | 148,127 | ||||||||
Other comprehensive income (loss): | ||||||||||||||||
Other comprehensive (loss) income: | ||||||||||||||||
Foreign currency translation | 5,825 | (19,344 | ) | (6,169 | ) | 5,825 | ||||||||||
Unrealized losses on investments before income taxes | (10 | ) | 0 | |||||||||||||
Unrealized gains (losses) on investments before income taxes | 15 | (10 | ) | |||||||||||||
Income tax expense | (4 | ) | — | |||||||||||||
Unrealized losses on investments, net of tax | (10 | ) | 0 | |||||||||||||
Unrealized gains (losses) on investments, net of tax | 11 | (10 | ) | |||||||||||||
Retirement liability adjustment before reclassifications | 1,054 | 296 | 268 | 1,054 | ||||||||||||
Amounts reclassified to other income | 216 | 340 | 127 | 216 | ||||||||||||
Retirement liability adjustment before income taxes | 1,270 | 636 | 395 | 1,270 | ||||||||||||
Income tax expense | (348 | ) | (238 | ) | (97 | ) | (348 | ) | ||||||||
Retirement liability adjustment, net of tax | 922 | 398 | 298 | 922 | ||||||||||||
Other comprehensive income (loss) | 6,737 | (18,946 | ) | |||||||||||||
Other comprehensive (loss) income | (5,860 | ) | 6,737 | |||||||||||||
Comprehensive income | $ | 154,864 | $ | 34,616 | $ | 153,971 | $ | 154,864 | ||||||||
Three Months Ended | ||||||||||||||||
Three Months Ended | April 2, 2022 | April 3, 2021 | ||||||||||||||
April 3, 2021 | March 28, 2020 | |||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||
Cash flows from operating activities: | ||||||||||||||||
Net income | $ | 148,127 | $ | 53,562 | $ | 159,831 | $ | 148,127 | ||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||||
Stock-based compensation | 8,305 | 9,196 | 10,933 | 8,305 | ||||||||||||
Deferred income taxes | 2,787 | (2,525 | ) | 4,175 | 2,787 | |||||||||||
Depreciation | 16,343 | 15,708 | 17,209 | 16,343 | ||||||||||||
Amortization of intangibles | 15,013 | 13,480 | 15,455 | 15,013 | ||||||||||||
Acquired in-process research and development and othernon-cash items | 9,381 | — | ||||||||||||||
Change in operating assets and liabilities: | ||||||||||||||||
Decrease in accounts receivable | 7,945 | 54,026 | ||||||||||||||
(Increase) decrease in accounts receivable | (907 | ) | 7,945 | |||||||||||||
Increase in inventories | (30,544 | ) | (29,399 | ) | (26,832 | ) | (30,544 | ) | ||||||||
Increase in other current assets | �� | (3,080 | ) | (5,036 | ) | (1,805 | ) | (3,080 | ) | |||||||
(Increase) decrease in other assets | (4,219 | ) | 2,745 | |||||||||||||
Increase in other assets | (13,491 | ) | (4,219 | ) | ||||||||||||
Decrease in accounts payable and other current liabilities | (29,758 | ) | (15,825 | ) | (69,548 | ) | (29,758 | ) | ||||||||
Increase in deferred revenue and customer advances | 89,048 | 46,465 | 91,514 | 89,048 | ||||||||||||
(Decrease) increase in other liabilities | (1,563 | ) | 9,238 | |||||||||||||
Increase (decrease) in other liabilities | 2,045 | (1,563 | ) | |||||||||||||
Net cash provided by operating activities | 218,404 | 151,635 | 197,960 | 218,404 | ||||||||||||
Cash flows from investing activities: | ||||||||||||||||
Additions to property, plant, equipment and software capitalization | (39,503 | ) | (51,130 | ) | (27,751 | ) | (39,503 | ) | ||||||||
Business acquisitions, net of cash acquired | 0 | (76,664 | ) | |||||||||||||
Proceeds from sale of equity investment | 6,785 | — | ||||||||||||||
Payments for intellectual property licenses | (4,897 | ) | — | |||||||||||||
Purchases of investments | (122,640 | ) | (3,520 | ) | (9,219 | ) | (122,640 | ) | ||||||||
Maturities and sales of investments | 3,139 | 1,139 | 54,074 | 3,139 | ||||||||||||
Net cash used in investing activities | (159,004 | ) | (130,175 | ) | ||||||||||||
Net cash provided by (used in) investing activities | 18,992 | (159,004 | ) | |||||||||||||
Cash flows from financing activities: | ||||||||||||||||
Proceeds from debt issuances | 500,000 | 315,000 | — | 500,000 | ||||||||||||
Payments on debt | (150,000 | ) | (100,366 | ) | (70,000 | ) | (150,000 | ) | ||||||||
Payments of debt issuance costs | (3,637 | ) | 0 | — | (3,637 | ) | ||||||||||
Proceeds from stock plans | 16,295 | 11,743 | 12,832 | 16,295 | ||||||||||||
Purchases of treasury shares | (173,305 | ) | (196,226 | ) | (170,136 | ) | (173,305 | ) | ||||||||
(Payments for) proceeds from derivative contracts | (578 | ) | 2,767 | |||||||||||||
Payments for derivative contracts | (107 | ) | (578 | ) | ||||||||||||
Net cash provided by financing activities | 188,775 | 32,918 | ||||||||||||||
Net cash (used in) provided by financing activities | (227,411 | ) | 188,775 | |||||||||||||
Effect of exchange rate changes on cash and cash equivalents | (1,087 | ) | (32 | ) | (10,705 | ) | (1,087 | ) | ||||||||
Increase in cash and cash equivalents | 247,088 | 54,346 | ||||||||||||||
(Decrease) increase in cash and cash equivalents | (21,164 | ) | 247,088 | |||||||||||||
Cash and cash equivalents at beginning of period | 436,695 | 335,715 | 501,234 | 436,695 | ||||||||||||
Cash and cash equivalents at end of period | $ | 683,783 | $ | 390,061 | $ | 480,070 | $ | 683,783 | ||||||||
Number of Common Shares | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Loss | Total Stockholders’ Deficit | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance December 31, 2019 | 161,030 | $ | 1,610 | $ | 1,926,753 | $ | 6,587,403 | $ | (8,612,576 | ) | $ | (119,471 | ) | $ | (216,281 | ) | ||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | 53,562 | — | — | 53,562 | |||||||||||||||||||||||||||||||||||||||||||||||||
Adoption of new accounting pronouncement | — | — | — | (985 | ) | — | — | (985 | ) | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | (18,946 | ) | (18,946 | ) | |||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock for employees: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Stock Purchase Plan | 9 | — | 1,736 | — | — | — | 1,736 | |||||||||||||||||||||||||||||||||||||||||||||||||
Stock options exercised | 81 | 1 | 10,124 | — | — | — | 10,125 | |||||||||||||||||||||||||||||||||||||||||||||||||
Treasury stock | — | — | — | — | (176,225 | ) | — | (176,225 | ) | |||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | 133 | 2 | 9,013 | — | — | — | 9,015 | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance March 28, 2020 | 161,253 | $ | 1,613 | $ | 1,947,626 | $ | 6,639,980 | $ | (8,788,801 | ) | $ | (138,417 | ) | $ | (337,999 | ) | ||||||||||||||||||||||||||||||||||||||||
Number of Common Shares | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | Number of Common Shares | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||||||||||||||
Balance December 31, 2020 | 161,666 | $ | 1,617 | $ | 2,029,465 | $ | 7,107,989 | $ | (8,788,984 | ) | $ | (117,943 | ) | $ | 232,144 | 161,666 | $ | 1,617 | $ | 2,029,465 | $ | 7,107,989 | $ | (8,788,984 | ) | $ | (117,943 | ) | $ | 232,144 | ||||||||||||||||||||||||||
Net income | — | — | — | 148,127 | — | — | 148,127 | — | — | — | 148,127 | — | — | 148,127 | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | 6,737 | 6,737 | — | — | — | — | — | 6,737 | 6,737 | ||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock for employees: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Stock Purchase Plan | 11 | 1,855 | — | — | — | 1,855 | 11 | — | 1,855 | — | — | — | 1,855 | |||||||||||||||||||||||||||||||||||||||||||
Stock options exercised | 95 | 1 | 15,129 | — | — | — | 15,130 | 95 | 1 | 15,129 | — | — | — | 15,130 | ||||||||||||||||||||||||||||||||||||||||||
Treasury stock | — | — | — | — | (180,659 | ) | — | (180,659 | ) | — | — | — | — | (180,659 | ) | — | (180,659 | ) | ||||||||||||||||||||||||||||||||||||||
Stock-based compensation | 87 | 1 | 7,627 | — | — | — | 7,628 | 87 | 1 | 7,627 | — | — | — | 7,628 | ||||||||||||||||||||||||||||||||||||||||||
Balance April 3, 2021 | 161,859 | $ | 1,619 | $ | 2,054,076 | $ | 7,256,116 | $ | (8,969,643 | ) | $ | (111,206 | ) | $ | 230,962 | 161,859 | $ | 1,619 | $ | 2,054,076 | $ | 7,256,116 | $ | (8,969,643 | ) | $ | (111,206 | ) | $ | 230,962 | ||||||||||||||||||||||||||
Number of Common Shares | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance December 31, 2021 | 162,084 | $ | 1,621 | $ | 2,114,880 | $ | 7,800,832 | $ | (9,437,914 | ) | $ | (111,865 | ) | $ | 367,554 | |||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | 159,831 | — | — | 159,831 | |||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | (5,860 | ) | (5,860 | ) | |||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock for employees: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Stock Purchase Plan | 7 | — | 2,327 | — | — | — | 2,327 | |||||||||||||||||||||||||||||||||||||||||||||||||
Stock options exercised | 69 | 1 | 11,091 | — | — | — | 11,092 | |||||||||||||||||||||||||||||||||||||||||||||||||
Treasury stock | — | — | — | — | (170,136 | ) | — | (170,136 | ) | |||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | 92 | 1 | 10,128 | — | — | — | 10,129 | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance April 2, 2022 | 162,252 | $ | 1,623 | $ | 2,138,426 | $ | 7,960,663 | $ | (9,608,050 | ) | $ | (117,725 | ) | $ | 374,937 | |||||||||||||||||||||||||||||||||||||||||
Balance at Beginning of Period | Impact of CECL Adoption | Additions | Deductions | Balance at End of Period | ||||||||||||||||
Allowance for Credit Losses | ||||||||||||||||||||
April 3, 2021 | $ | 14,381 | $ | — | $ | 775 | $ | (1,561 | ) | $ | 13,595 | |||||||||
March 28, 2020 | $ | 9,560 | $ | 985 | $ | 3,506 | $ | (1,749 | ) | $ | 12,302 |
Balance at Beginning of Period | Additions | Deductions | Balance at End of Period | |||||||||||||
Allowance for Credit Losses | ||||||||||||||||
April 2, 2022 | $ | 13,228 | $ | 987 | $ | (1,072 | ) | $ | 13,143 | |||||||
April 3, 2021 | $ | 14,381 | $ | 775 | $ | (1,561 | ) | $ | 13,595 |
Total at April 3, 2021 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Quoted Prices | ||||||||||||||||||||||||||||
in Active | Significant | |||||||||||||||||||||||||||||||
Markets | Other | Significant | ||||||||||||||||||||||||||||||
Total at | for Identical | Observable | Unobservable | |||||||||||||||||||||||||||||
April 2, | Assets | Inputs | Inputs | |||||||||||||||||||||||||||||
2022 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
U.S. Treasury securities | $ | 12,061 | $ | 0 | $ | 12,061 | $ | 0 | $ | 4,796 | $ | — | $ | 4,796 | $ | — | ||||||||||||||||
Corporate debt securities | 119,800 | 0 | 119,800 | 0 | 5,605 | — | 5,605 | — | ||||||||||||||||||||||||
Time deposits | 58,712 | 0 | 58,712 | 0 | 14,624 | — | 14,624 | — | ||||||||||||||||||||||||
Waters 401(k) Restoration Plan assets | 39,605 | 39,605 | 0 | 0 | 32,953 | 32,953 | — | — | ||||||||||||||||||||||||
Foreign currency exchange contracts | 208 | 0 | 208 | 0 | 9 | — | 9 | — | ||||||||||||||||||||||||
Interest rate cross-currency swap agreements | 8,163 | — | 8,163 | — | ||||||||||||||||||||||||||||
Total | $ | 230,386 | $ | 39,605 | $ | 190,781 | $ | 0 | $ | 66,150 | $ | 32,953 | $ | 33,197 | $ | — | ||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Contingent consideration | $ | 1,225 | $ | 0 | $ | 0 | $ | 1,225 | $ | 1,388 | $ | — | $ | — | $ | 1,388 | ||||||||||||||||
Foreign currency exchange contracts | 241 | 0 | 241 | 0 | 190 | — | 190 | — | ||||||||||||||||||||||||
Interest rate cross-currency swap agreements | 20,030 | 0 | 20,030 | 0 | 635 | — | 635 | — | ||||||||||||||||||||||||
Total | $ | 21,496 | $ | 0 | $ | 20,271 | $ | 1,225 | $ | 2,213 | $ | — | $ | 825 | $ | 1,388 | ||||||||||||||||
Total at December 31, 2020 | Quoted in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Quoted Prices | ||||||||||||||||||||||||||||
in Active | Significant | |||||||||||||||||||||||||||||||
Markets | Other | Significant | ||||||||||||||||||||||||||||||
Total at | for Identical | Observable | Unobservable | |||||||||||||||||||||||||||||
December 31, | Assets | Inputs | Inputs | |||||||||||||||||||||||||||||
2021 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
U.S. Treasury securities | $ | 13,917 | $ | — | $ | 13,917 | — | |||||||||||||||||||||||||
Corporate debt securities | 39,121 | — | 39,121 | — | ||||||||||||||||||||||||||||
Time deposits | $ | 6,451 | $ | — | $ | 6,451 | $ | — | 19,030 | — | 19,030 | $ | — | |||||||||||||||||||
Waters 401(k) Restoration Plan assets | 38,988 | 38,988 | — | — | 38,729 | 38,729 | — | — | ||||||||||||||||||||||||
Foreign currency exchange contracts | 836 | — | 836 | — | 504 | — | 504 | — | ||||||||||||||||||||||||
Total | $ | 46,275 | $ | 38,988 | $ | 7,287 | $ | — | $ | 111,301 | $ | 38,729 | $ | 72,572 | $ | — | ||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Contingent consideration | $ | 1,185 | $ | — | $ | — | $ | 1,185 | $ | 1,347 | $ | — | $ | — | $ | 1,347 | ||||||||||||||||
Foreign currency exchange contracts | 185 | — | 185 | — | 195 | — | 195 | — | ||||||||||||||||||||||||
Interest rate cross-currency swap agreements | 44,996 | — | 44,996 | — | 5,363 | — | 5,363 | — | ||||||||||||||||||||||||
Total | $ | 46,366 | $ | — | $ | 45,181 | $ | 1,185 | $ | 6,905 | $ | — | $ | 5,558 | $ | 1,347 | ||||||||||||||||
April 3, 2021 | December 31, 2020 | |||||||||||||||
Notional Value | Fair Value | Notional Value | Fair Value | |||||||||||||
Foreign currency exchange contracts: | ||||||||||||||||
Other current assets | $ | 36,131 | $ | 208 | $ | 66,690 | $ | 836 | ||||||||
Other current liabilities | $ | 25,423 | $ | 241 | $ | 20,000 | $ | 185 | ||||||||
Interest rate cross-currency swap agreements: | ||||||||||||||||
Other liabilities | $ | 520,000 | $ | (20,030 | ) | $ | 560,000 | $ | (44,996 | ) | ||||||
Accumulated other comprehensive loss | $ | 23,751 | $ | 44,996 |
Financial | Three Months Ended | |||||||||
Statement Classification | April 3, 2021 | March 28, 2020 | ||||||||
Foreign currency exchange contracts: | ||||||||||
Realized gains (losses) on closed contracts | Cost of sales | $ | 1,667 | $ | (2,981 | ) | ||||
Unrealized (losses) gains on open contracts | Cost of sales | (753 | ) | 1,325 | ||||||
Cumulative net pre-tax gains (losses) | Cost of sales | $ | 914 | $ | (1,656 | ) | ||||
Interest rate cross-currency swap agreements: | ||||||||||
Interest earned | Interest income | $ | 3,827 | $ | 3,714 | |||||
Unrealized gains on contracts, net | Stockholders’ equity (deficit) | $ | 21,244 | $ | 5,522 |
April 2, 2022 | December 31, 2021 | |||||||||||||||
Notional Value | Fair Value | Notional Value | Fair Value | |||||||||||||
Foreign currency exchange contracts: | ||||||||||||||||
Other current assets | $ | 10,509 | $ | 9 | $ | 55,309 | $ | 504 | ||||||||
Other current liabilities | $ | 46,882 | $ | 190 | $ | 9,000 | $ | 195 | ||||||||
Interest rate cross-currency swap agreements: | ||||||||||||||||
Other assets | $ | 470,000 | $ | 8,163 | $ | 0 | $ | 0 | ||||||||
Other liabilities | 80,000 | 635 | 230,000 | 5,363 | ||||||||||||
Accumulated other comprehensive loss | $ | 3,755 | $ | 15,944 |
Financial Statement Classification | Three Months Ended | |||||||||
April 2, 2022 | April 3, 2021 | |||||||||
Foreign currency exchange contracts: | ||||||||||
Realized (losses) gains on closed contracts | Cost of sales | $ | (1,499 | ) | $ | 1,667 | ||||
Unrealized losses on open contracts | Cost of sales | (489 | ) | (753 | ) | |||||
Cumulative net pre-tax (losses) gains | Cost of sales | $ | (1,988 | ) | $ | 914 | ||||
Interest rate cross-currency swap agreements: | ||||||||||
Interest earned | Interest income | $ | 1,775 | $ | 3,827 | |||||
Unrealized gains on contracts, net | Accumulated other comprehensive loss | $ | 12,188 | $ | 21,244 |
Balance at Beginning of Period | Accruals for Warranties | Settlements Made | Balance at End of Period | |||||||||||||||||||||||||||||
Balance at Beginning of Period | Accruals for Warranties | Settlements Made | Balance at End of Period | |||||||||||||||||||||||||||||
Accrued warranty liability: | ||||||||||||||||||||||||||||||||
April 2, 2022 | $ | 10,718 | $ | 1,916 | $ | (2,422 | ) | $ | 10,212 | |||||||||||||||||||||||
April 3, 2021 | $ | 10,950 | $ | 2,337 | $ | (2,582 | ) | $ | 10,705 | $ | 10,950 | $ | 2,337 | $ | (2,582 | ) | $ | 10,705 | ||||||||||||||
March 28, 2020 | $ | 11,964 | $ | 1,671 | $ | (2,619 | ) | $ | 11,016 |
April 3, 2021 | March 28, 2020 | April 2, 2022 | April 3, 2021 | |||||||||||||
Balance at the beginning of the period | $ | 239,759 | $ | 213,695 | $ | 273,598 | $ | 239,759 | ||||||||
Recognition of revenue included in balance at beginning of the period | (94,078 | ) | (82,604 | ) | (103,355 | ) | (94,078 | ) | ||||||||
Revenue deferred during the period, net of revenue recognized | 182,384 | 138,430 | 198,036 | 182,384 | ||||||||||||
Balance at the end of the period | $ | 328,065 | $ | 269,521 | $ | 368,279 | $ | 328,065 | ||||||||
April 3, 2021 | April 2, 2022 | |||||||
Deferred revenue and customer advances expected to be recognized in: | ||||||||
One year or less | $ | 280,848 | $ | 315,086 | ||||
13-24 months | 25,860 | 32,877 | ||||||
25 months and beyond | 21,357 | 20,316 | ||||||
Total | $ | 328,065 | $ | 368,279 | ||||
April 3, 2021 | April 2, 2022 | |||||||||||||||||||||||||||||||
Amortized Cost | Unrealized Gain | Unrealized Loss | Fair Value | Amortized | Unrealized | Unrealized | Fair | |||||||||||||||||||||||||
Cost | Gain | Loss | Value | |||||||||||||||||||||||||||||
U.S. Treasury securities | $ | 12,061 | $ | — | $ | — | $ | 12,061 | $ | 4,802 | $ | — | $ | (6 | ) | $ | 4,796 | |||||||||||||||
Corporate debt securities | 119,810 | 7 | (17 | ) | 119,800 | 5,610 | — | (5 | ) | 5,605 | ||||||||||||||||||||||
Time deposits | 58,712 | — | — | 58,712 | 14,624 | — | — | 14,624 | ||||||||||||||||||||||||
Total | $ | 190,583 | $ | 7 | $ | (17 | ) | $ | 190,573 | $ | 25,036 | $ | — | $ | (11 | ) | $ | 25,025 | ||||||||||||||
Amounts included in: | ||||||||||||||||||||||||||||||||
Cash equivalents | $ | 64,590 | $ | 1 | $ | (4 | ) | $ | 64,587 | $ | 2,000 | $ | — | $ | — | $ | 2,000 | |||||||||||||||
Investments | 125,993 | 6 | (13 | ) | 125,986 | 23,036 | — | (11 | ) | 23,025 | ||||||||||||||||||||||
Total | $ | 190,583 | $ | 7 | $ | (17 | ) | $ | 190,573 | $ | 25,036 | $ | — | $ | (11 | ) | $ | 25,025 | ||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||||||
Amortized Cost | Unrealized Gain | Unrealized Loss | Fair Value | |||||||||||||||||||||||||||||
Time deposits | 6,451 | — | — | 6,451 | ||||||||||||||||||||||||||||
Total | $ | 6,451 | $ | — | $ | — | $ | 6,451 | ||||||||||||||||||||||||
Amounts included in: | ||||||||||||||||||||||||||||||||
Investments | 6,451 | — | — | 6,451 | ||||||||||||||||||||||||||||
Total | $ | 6,451 | $ | — | $ | — | $ | 6,451 | ||||||||||||||||||||||||
December 31, 2021 | ||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | |||||||||||||
Cost | Gain | Loss | Value | |||||||||||||
U.S. Treasury securities | $ | 13,929 | $ | — | $ | (12 | ) | $ | 13,917 | |||||||
Corporate debt securities | 39,135 | — | (14 | ) | 39,121 | |||||||||||
Time deposits | 19,030 | — | — | 19,030 | ||||||||||||
Total | $ | 72,094 | $ | — | $ | (26 | ) | $ | 72,068 | |||||||
Amounts included in: | ||||||||||||||||
Cash equivalents | $ | 4,017 | $ | — | $ | 0 | $ | 4,017 | ||||||||
Investments | 68,077 | — | (26 | ) | 68,051 | |||||||||||
Total | $ | 72,094 | $ | — | $ | (26 | ) | $ | 72,068 | |||||||
April 3, 2021 | December 31, 2020 | April 2, 2022 | December 31, 2021 | |||||||||||||
Due in one year or less | $ | 164,762 | $ | 6,451 | $ | 25,025 | $ | 71,066 | ||||||||
Due after one year through three years | 25,811 | — | — | 1,002 | ||||||||||||
Total | $ | 190,573 | $ | 6,451 | $ | 25,025 | $ | 72,068 | ||||||||
April 3, 2021 | December 31, 2020 | April 2, 2022 | December 31, 2021 | |||||||||||||
Raw materials | $ | 141,600 | $ | 133,490 | $ | 168,324 | $ | 165,240 | ||||||||
Work in progress | 21,689 | 18,678 | 24,087 | 19,726 | ||||||||||||
Finished goods | 164,678 | 152,113 | 189,491 | 171,129 | ||||||||||||
Total inventories | $ | 327,967 | $ | 304,281 | $ | 381,902 | $ | 356,095 | ||||||||
April 3, 2021 | December 31, 2020 | April 2, 2022 | December 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Weighted- Average Amortization Period | Gross Carrying Amount | Accumulated Amortization | Weighted- Average Amortization Period | Weighted- | Weighted- | |||||||||||||||||||||||||||||||||||||||||
Gross | Average | Gross | Average | |||||||||||||||||||||||||||||||||||||||||||||
Carrying | Accumulated | Amortization | Carrying | Accumulated | Amortization | |||||||||||||||||||||||||||||||||||||||||||
Amount | Amortization | Period | Amount | Amortization | Period | |||||||||||||||||||||||||||||||||||||||||||
Capitalized software | $ | 563,157 | $ | 403,614 | 5 years | $ | 584,452 | $ | 409,847 | 5 years | $ | 576,013 | $ | 424,114 | 5 years | $ | 575,658 | $ | 420,862 | 5 years | ||||||||||||||||||||||||||||
Purchased intangibles | 202,828 | 160,028 | 11 years | 205,585 | 160,342 | 11 years | 200,284 | 164,372 | 11 years | 201,302 | 163,752 | 11 years | ||||||||||||||||||||||||||||||||||||
Trademarks | 9,680 | — | — | 9,680 | — | — | 9,680 | — | — | 9,680 | — | — | ||||||||||||||||||||||||||||||||||||
Licenses | 5,960 | 5,773 | 6 years | 5,923 | 5,697 | 6 years | 12,339 | 6,285 | 7 years | 12,635 | 6,199 | 7 years | ||||||||||||||||||||||||||||||||||||
Patents and other intangibles | 92,321 | 63,678 | 8 years | 90,699 | 61,808 | 8 years | 102,493 | 69,630 | 8 years | 102,353 | 68,414 | 8 years | ||||||||||||||||||||||||||||||||||||
Total | $ | 873,946 | $ | 633,093 | 7 years | $ | 896,339 | $ | 637,694 | 7 years | $ | 900,809 | $ | 664,401 | 7 years | $ | 901,628 | $ | 659,227 | 7 years | ||||||||||||||||||||||||||||
Senior Unsecured Notes | Term | Interest Rate | Face Value (in millions) | Maturity Date | ||||||
Series N | 5 years | 1.68% | $ | 100 | March 2026 | |||||
Series O | 10 years | 2.25% | $ | 400 | March 2031 |
April 3, 2021 | December 31, 2020 | |||||||||||||||
Senior unsecured notes - Series E - 3.97%, due March 2021 | — | 50,000 | ||||||||||||||
Senior unsecured notes - Series F - 3.40%, due June 2021 | 100,000 | 100,000 | ||||||||||||||
Total notes payable and debt, current | 100,000 | 150,000 | ||||||||||||||
April 2, 2022 | December 31, 2021 | |||||||||||||||
Senior unsecured notes - Series G - 3.92%, due June 2024 | 50,000 | 50,000 | 50,000 | 50,000 | ||||||||||||
Senior unsecured notes - Series H - floating rate*, due June 2024 | 50,000 | 50,000 | 50,000 | 50,000 | ||||||||||||
Senior unsecured notes - Series I - 3.13%, due May 2023 | 50,000 | 50,000 | 50,000 | 50,000 | ||||||||||||
Senior unsecured notes - Series K - 3.44%, due May 2026 | 160,000 | 160,000 | 160,000 | 160,000 | ||||||||||||
Senior unsecured notes - Series L - 3.31%, due September 2026 | 200,000 | 200,000 | 200,000 | 200,000 | ||||||||||||
Senior unsecured notes - Series M - 3.53%, due September 2029 | 300,000 | 300,000 | 300,000 | 300,000 | ||||||||||||
Senior unsecured notes - Series N - 1.68%, due March 2026 | 100,000 | — | 100,000 | 100,000 | ||||||||||||
Senior unsecured notes - Series O - 2.25%, due March 2031 | 400,000 | — | 400,000 | 400,000 | ||||||||||||
Credit agreement | 300,000 | 400,000 | 140,000 | 210,000 | ||||||||||||
Unamortized debt issuance costs | (6,910 | ) | (3,485 | ) | (5,878 | ) | (6,130 | ) | ||||||||
Total long-term debt | 1,603,090 | 1,206,515 | 1,444,122 | 1,513,870 | ||||||||||||
Total debt | $ | 1,703,090 | $ | 1,356,515 | $ | 1,444,122 | $ | 1,513,870 | ||||||||
* | Series H senior unsecured notes bear interest at a 3-month LIBOR for that floating rate interest period plus 1.25%. |
April 3, 2021 | March 28, 2020 | |||||||
Balance at the beginning of the period | $ | 28,666 | $ | 27,790 | ||||
Net reductions for lapse of statutes taken during the period | (95 | ) | (101 | ) | ||||
Net additions for tax positions taken during the current period | 289 | 203 | ||||||
Balance at the end of the period | $ | 28,860 | $ | 27,892 | ||||
Three Months Ended | Three Months Ended | |||||||||||||||
April 3, 2021 | March 28, 2020 | April 2, 2022 | April 3, 2021 | |||||||||||||
Cost of sales | $ | 633 | $ | 570 | $ | 1,027 | $ | 633 | ||||||||
Selling and administrative expenses | 6,420 | 7,373 | 8,169 | 6,420 | ||||||||||||
Research and development expenses | 1,252 | 1,253 | 1,737 | 1,252 | ||||||||||||
Total stock-based compensation | $ | 8,305 | $ | 9,196 | $ | 10,933 | $ | 8,305 | ||||||||
Three Months Ended | ||||||||
Options Issued and Significant Assumptions Used to Estimate Option Fair Values | April 3, 2021 | March 28, 2020 | ||||||
Options issued in thousands | 139 | 227 | ||||||
Risk-free interest rate | 0.8 | % | 1.4 | % | ||||
Expected life in years | 6 | 6 | ||||||
Expected volatility | 33.1 | % | 26.5 | % | ||||
Expected dividend s | 0 | — | ||||||
Three Months Ended | ||||||||
Weighted-Average Exercise Price and Fair Value of Options on the Date of Grant | April 3, 2021 | March 28, 2020 | ||||||
Exercise price | $ | 277.32 | $ | 216.08 | ||||
Fair value | $ | 91.63 | $ | 61.70 |
Three Months Ended | ||||||||
Options Issued and Significant Assumptions Used to Estimate Option Fair Values | April 2, 2022 | April 3, 2021 | ||||||
Options issued in thousands | 127 | 139 | ||||||
Risk-free interest rate | 1.9 | % | 0.8 | % | ||||
Expected life in years | 6 | 6 | ||||||
Expected volatility | 30.9 | % | 33.1 | % | ||||
Expected dividends | 0 | — |
Three Months Ended | ||||||||
Weighted-Average Exercise Price and Fair Value of Options on the Date of Grant | April 2, 2022 | April 3, 2021 | ||||||
Exercise price | $ | 321.91 | $ | 277.32 | ||||
Fair value | $ | 107.76 | $ | 91.63 |
Number of Shares | Exercise Price per Share | Weighted-Average Exercise Price per Share | Number of Shares | Exercise Price per Share | Weighted-Average Exercise Price per Share | |||||||||||||||||||||||||
Outstanding at December 31, 2020 | 1,067 | $ | 75.94 | to | $ | 238.52 | $ | 179.59 | ||||||||||||||||||||||
Outstanding at December 31, 2021 | 691 | $ | 88.71 to $371.64 | $ | 202.24 | |||||||||||||||||||||||||
Granted | 139 | $ | 250.15 | to | $ | 280.80 | $ | 277.32 | 127 | $ | 314.98 to $364.59 | $ | 321.91 | |||||||||||||||||
Exercised | (95 | ) | $ | 99.22 | to | $ | 238.52 | $ | 159.10 | (69 | ) | $ | 88.71 to $279.90 | $ | 160.49 | |||||||||||||||
Canceled | (125 | ) | $ | 139.51 | to | $ | 224.37 | $ | 183.98 | (6 | ) | $ | 203.37 to $279.90 | $ | 235.95 | |||||||||||||||
Outstanding at April 3, 2021 | 986 | $ | 75.94 | to | $ | 266.05 | $ | 194.77 | ||||||||||||||||||||||
Outstanding at April 2, 2022 | 743 | $ | 88.71 to $371.64 | $ | 226.30 | |||||||||||||||||||||||||
Shares | Weighted-Average Grant Date Fair Value per Share | |||||||
Unvested at December 31, 2020 | 271 | $ | 202.00 | |||||
Granted | 76 | $ | 279.66 | |||||
Vested | (80 | ) | $ | 182.14 | ||||
Forfeited | (3 | ) | $ | 210.35 | ||||
Unvested at April 3, 2021 | 264 | $ | 230.28 | |||||
Shares | Weighted-Average Grant Date Fair Value per Share | |||||||
Unvested at December 31, 2021 | 245 | $ | 234.97 | |||||
Granted | 94 | $ | 323.65 | |||||
Vested | (68 | ) | $ | 217.21 | ||||
Forfeited | (3 | ) | $ | 228.76 | ||||
Unvested at April 2, 2022 | 268 | $ | 270.65 | |||||
Three Months Ended | ||||||||
Performance Stock Units Issued and Significant Assumptions Used to Estimate Fair Values | April 3, 2021 | March 28, 2020 | ||||||
Performance stock units issued (in thousands) | 41 | 58 | ||||||
Risk-free interest rate | 0.2 | % | 1.3 | % | ||||
Expected life in years | 2.9 | 2.9 | ||||||
Expected volatility | 38.7 | % | 25.1 | % | ||||
Average volatility of peer companies | 34.7 | % | 26.1 | % | ||||
Correlation coefficient | 45.8 | % | 36.6 | % | ||||
Expected dividends | 0 | — |
Three Months Ended | ||||||||
Performance Stock Units Issued and Significant Assumptions Used to Estimate Fair Values | April 2, 2022 | April 3, 2021 | ||||||
Performance stock units issued (in thousands) | 40 | 41 | ||||||
Risk-free interest rate | 1.6 | % | 0.2 | % | ||||
Expected life in years | 2.9 | 2.9 | ||||||
Expected volatility | 25.4 | % | 38.7 | % | ||||
Average volatility of peer companies | 34.5 | % | 34.7 | % | ||||
Correlation coefficient | 43.0 | % | 45.8 | % | ||||
Expected dividends | 0 | — |
Shares | Weighted-Average Fair Value per Share | Shares | Weighted-Average Fair Value per Share | |||||||||||||
Unvested at December 31, 2020 | 95 | $ | 230.36 | |||||||||||||
Unvested at December 31, 2021 | 87 | $ | 285.73 | |||||||||||||
Granted | 41 | $ | 315.98 | 40 | $ | 325.12 | ||||||||||
Vested | (5 | ) | $ | 242.94 | (24 | ) | $ | 308.71 | ||||||||
Forfeited | (33 | ) | $ | 228.24 | 11 | $ | 396.67 | |||||||||
Unvested at April 3, 2021 | 98 | $ | 266.25 | |||||||||||||
Unvested at April 2, 2022 | 114 | $ | 305.42 | |||||||||||||
Three Months Ended April 2, 2022 | ||||||||||||||||||||||||
Three Months Ended April 3, 2021 | Net Income | Weighted- Average Shares | Per Share | |||||||||||||||||||||
Net Income (Numerator) | Weighted- Average (Denominator) | Per Amount | (Numerator) | (Denominator) | Amount | |||||||||||||||||||
Net income per basic common share | $ | 148,127 | 62,260 | $ | 2.38 | $ | 159,831 | 60,580 | $ | 2.64 | ||||||||||||||
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities | 0 | 372 | (0.01 | ) | — | 372 | (0.02 | ) | ||||||||||||||||
Net income per diluted common share | $ | 148,127 | 62,632 | $ | 2.37 | $ | 159,831 | 60,952 | $ | 2.62 | ||||||||||||||
Three Months Ended April 3, 2021 | ||||||||||||||||||||||||
Three Months Ended March 28, 2020 | Net Income | Weighted- Average Shares | Per Share | |||||||||||||||||||||
Net Income (Numerator) | Weighted- Average Shares (Denominator) | Per Amount | (Numerator) | (Denominator) | Amount | |||||||||||||||||||
Net income per basic common share | $ | 53,562 | 62,232 | $ | 0.86 | $ | 148,127 | 62,260 | $ | 2.38 | ||||||||||||||
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities | — | 394 | — | 0 | 372 | (0.01 | ) | |||||||||||||||||
Net income per diluted common share | $ | 53,562 | 62,626 | $ | 0.86 | $ | 148,127 | 62,632 | $ | 2.37 | ||||||||||||||
Currency Translation | Unrealized Loss on Retirement Plans | Unrealized Gain (Loss) on Investments | Accumulated Other Comprehensive Loss | |||||||||||||
Balance at December 31, 2020 | $ | (98,082 | ) | $ | (19,861 | ) | $ | 0 | $ | (117,943 | ) | |||||
Other comprehensive loss, net of tax | 5,825 | 922 | (10 | ) | 6,737 | |||||||||||
Balance at April 3, 2021 | $ | (92,257 | ) | $ | (18,939 | ) | $ | (10 | ) | $ | (111,206 | ) | ||||
Currency Translation | Unrealized Gain (Loss) on Retirement Plans | Unrealized Gain (Loss) on Investments | Accumulated Other Comprehensive Loss | |||||||||||||
Balance at December 31, 2021 | $ | (99,985 | ) | $ | (11,860 | ) | $ | (20 | ) | $ | (111,865 | ) | ||||
Other comprehensive (loss) income, net of tax | (6,169 | ) | 298 | 11 | (5,860 | ) | ||||||||||
Balance at April 2, 2022 | $ | (106,154 | ) | $ | (11,562 | ) | $ | (9 | ) | $ | (117,725 | ) | ||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||||
April 3, 2021 | March 28, 2020 | April 2, 2022 | April 3, 2021 | |||||||||||||||||||||||||||||
U.S. Retiree | Non-U.S. | U.S. Retiree | Non-U.S. | U.S. Retiree | Non-U.S. | U.S. Retiree | Non-U.S. | |||||||||||||||||||||||||
Healthcare | Pension | Healthcare | Pension | Healthcare | Pension | Healthcare | Pension | |||||||||||||||||||||||||
Plan | Plans | Plan | Plans | Plan | Plans | Plan | Plans | |||||||||||||||||||||||||
Service cost | $ | 233 | $ | 1,160 | $ | 151 | $ | 1,099 | $ | 226 | $ | 1,082 | $ | 233 | $ | 1,160 | ||||||||||||||||
Interest cost | 139 | 315 | 176 | 345 | 145 | 366 | 139 | 315 | ||||||||||||||||||||||||
Expected return on plan assets | (255 | ) | (466 | ) | (219 | ) | (456 | ) | (269 | ) | (534 | ) | (255 | ) | (466 | ) | ||||||||||||||||
Net amortization: | ||||||||||||||||||||||||||||||||
Prior service credit | (5 | ) | (41 | ) | (5 | ) | (40 | ) | (5 | ) | (37 | ) | (5 | ) | (41 | ) | ||||||||||||||||
Net actuarial loss | 0 | 262 | — | 385 | — | 169 | — | 262 | ||||||||||||||||||||||||
Net periodic pension cost | $ | 112 | $ | 1,230 | $ | 103 | $ | 1,333 | $ | 97 | $ | 1,046 | $ | 112 | $ | 1,230 | ||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||
April 3, 2021 | March 28, 2020 | April 2, 2022 | April 3, 2021 | |||||||||||||
Product net sales: | ||||||||||||||||
Waters instrument systems | $ | 216,072 | $ | 142,829 | $ | 269,962 | $ | 216,072 | ||||||||
Chemistry consumables | 118,974 | 97,245 | 125,618 | 118,974 | ||||||||||||
TA instrument systems | 46,976 | 34,109 | 55,260 | 46,976 | ||||||||||||
Total product sales | 382,022 | 274,183 | 450,840 | 382,022 | ||||||||||||
Service net sales: | ||||||||||||||||
Waters service | 206,832 | 174,137 | 217,576 | 206,832 | ||||||||||||
TA service | 19,691 | 16,619 | 22,156 | 19,691 | ||||||||||||
Total service sales | 226,523 | 190,756 | 239,732 | 226,523 | ||||||||||||
Total net sales | $ | 608,545 | $ | 464,939 | $ | 690,572 | $ | 608,545 | ||||||||
Three Months Ended | ||||||||
April 3, 2021 | March 28, 2020 | |||||||
Net Sales: | ||||||||
Asia: | ||||||||
China | $ | 102,919 | $ | 47,231 | ||||
Japan | 50,296 | 45,089 | ||||||
Asia Other | 76,327 | 66,760 | ||||||
Total Asia | 229,542 | 159,080 | ||||||
Americas: | ||||||||
United States | 162,433 | 143,898 | ||||||
Americas Other | 34,924 | 28,278 | ||||||
Total Americas | 197,357 | 172,176 | ||||||
Europe | 181,646 | 133,683 | ||||||
Total net sales | $ | 608,545 | $ | 464,939 | ||||
Three Months Ended | ||||||||
April 2, 2022 | April 3, 2021 | |||||||
Net Sales: | ||||||||
Asia: | ||||||||
China | $ | 121,032 | $ | 102,919 | ||||
Japan | 48,623 | 50,296 | ||||||
Asia Other | 84,679 | 76,327 | ||||||
Total Asia | 254,334 | 229,542 | ||||||
Americas: | ||||||||
United States | 208,713 | 162,433 | ||||||
Americas Other | 40,124 | 34,924 | ||||||
Total Americas | 248,837 | 197,357 | ||||||
Europe | 187,401 | 181,646 | ||||||
Total net sales | $ | 690,572 | $ | 608,545 | ||||
Three Months Ended | Three Months Ended | |||||||||||||||
April 3, 2021 | March 28, 2020 | April 2, 2022 | April 3, 2021 | |||||||||||||
Pharmaceutical | $ | 360,148 | $ | 272,563 | $ | 415,772 | $ | 360,148 | ||||||||
Industrial | 183,273 | 143,354 | 209,397 | 183,273 | ||||||||||||
Academic and government | 65,124 | 49,022 | 65,403 | 65,124 | ||||||||||||
Total net sales | $ | 608,545 | $ | 464,939 | $ | 690,572 | $ | 608,545 | ||||||||
Three Months Ended | Three Months Ended | |||||||||||||||
April 3, 2021 | March 28, 2020 | April 2, 2022 | April 3, 2021 | |||||||||||||
Net sales recognized at a point in time: | ||||||||||||||||
Instrument systems | $ | 263,048 | $ | 176,938 | $ | 325,222 | $ | 263,048 | ||||||||
Chemistry consumables | 118,974 | 97,245 | 125,618 | 118,974 | ||||||||||||
Service sales recognized at a point in time (time & materials) | 79,287 | 67,742 | 85,778 | 79,287 | ||||||||||||
Total net sales recognized at a point in time | 461,309 | 341,925 | 536,618 | 461,309 | ||||||||||||
Net sales recognized over time: | ||||||||||||||||
Service and software sales recognized over time (contracts) | 147,236 | 123,014 | 153,954 | 147,236 | ||||||||||||
Total net sales | $ | 608,545 | $ | 464,939 | $ | 690,572 | $ | 608,545 | ||||||||
Item 2: | Management ’ s Discussion and Analysis of Financial Condition and
Results of Operations |
Three Months Ended | ||||||||||||
April 2, 2022 | April 3, 2021 | % Change | ||||||||||
Revenues: | ||||||||||||
Product sales | $ | 450,840 | $ | 382,022 | 18 | % | ||||||
Service sales | 239,732 | 226,523 | 6 | % | ||||||||
Total net sales | 690,572 | 608,545 | 13 | % | ||||||||
Costs and operating expenses: | ||||||||||||
Cost of sales | 285,685 | 254,147 | 12 | % | ||||||||
Selling and administrative expenses | 157,475 | 143,196 | 10 | % | ||||||||
Research and development expenses | 40,472 | 38,092 | 6 | % | ||||||||
Purchased intangibles amortization | 1,673 | 1,840 | (9 | %) | ||||||||
Acquired in-process research and development | 9,797 | — | — | |||||||||
Operating income | 195,470 | 171,270 | 14 | % | ||||||||
Operating income as a % of sales | 28.3 | % | 28.1 | % | ||||||||
Other income, net | 170 | 9,359 | (98 | %) | ||||||||
Interest expense, net | (8,945 | ) | (6,845 | ) | 31 | % | ||||||
Income before income taxes | 186,695 | 173,784 | 7 | % | ||||||||
Provision for income taxes | 26,864 | 25,657 | 5 | % | ||||||||
Net income | $ | 159,831 | $ | 148,127 | 8 | % | ||||||
Net income per diluted common share | $ | 2.62 | $ | 2.37 | 11 | % |
Three Months Ended | ||||||||||||
April 2, 2022 | April 3, 2021 | % change | ||||||||||
Net Sales: | ||||||||||||
Asia: | ||||||||||||
China | $ | 121,032 | $ | 102,919 | 18 | % | ||||||
Japan | 48,623 | 50,296 | (3 | %) | ||||||||
Asia Other | 84,679 | 76,327 | 11 | % | ||||||||
Total Asia | 254,334 | 229,542 | 11 | % | ||||||||
Americas: | ||||||||||||
United States | 208,713 | 162,433 | 28 | % | ||||||||
Americas Other | 40,124 | 34,924 | 15 | % | ||||||||
Total Americas | 248,837 | 197,357 | 26 | % | ||||||||
Europe | 187,401 | 181,646 | 3 | % | ||||||||
Total net sales | $ | 690,572 | $ | 608,545 | 13 | % | ||||||
Three Months Ended | ||||||||||||
April 2, 2022 | April 3, 2021 | % change | ||||||||||
Pharmaceutical | $ | 415,772 | $ | 360,148 | 15 | % | ||||||
Industrial | 209,397 | 183,273 | 14 | % | ||||||||
Academic and government | 65,403 | 65,124 | — | |||||||||
Total net sales | $ | 690,572 | $ | 608,545 | 13 | % | ||||||
Three Months Ended | ||||||||||||
April 3, 2021 | March 28, 2020 | % change | ||||||||||
Net Sales: | ||||||||||||
Asia: | ||||||||||||
China | $ | 102,919 | $ | 47,231 | 118 | % | ||||||
Japan | 50,296 | 45,089 | 12 | % | ||||||||
Asia Other | 76,327 | 66,760 | 14 | % | ||||||||
Total Asia | 229,542 | 159,080 | 44 | % | ||||||||
Americas: | ||||||||||||
United States | 162,433 | 143,898 | 13 | % | ||||||||
Americas Other | 34,924 | 28,278 | 24 | % | ||||||||
Total Americas | 197,357 | 172,176 | 15 | % | ||||||||
Europe | 181,646 | 133,683 | 36 | % | ||||||||
Total net sales | $ | 608,545 | $ | 464,939 | 31 | % | ||||||
Three Months Ended | ||||||||||||
April 3, 2021 | March 28, 2020 | % change | ||||||||||
Pharmaceutical | $ | 360,148 | $ | 272,563 | 32 | % | ||||||
Industrial | 183,273 | 143,354 | 28 | % | ||||||||
Academic and government | 65,124 | 49,022 | 33 | % | ||||||||
Total net sales | $ | 608,545 | $ | 464,939 | 31 | % | ||||||
Three Months Ended | ||||||||||||||||||||
April 3, 2021 | % of Total | March 28, 2020 | % of Total | % change | ||||||||||||||||
Waters instrument systems | $ | 216,072 | 40 | % | $ | 142,829 | 34 | % | 51 | % | ||||||||||
Chemistry consumables | 118,974 | 22 | % | 97,245 | 24 | % | 22 | % | ||||||||||||
Total Waters product sales | 335,046 | 62 | % | 240,074 | 58 | % | 40 | % | ||||||||||||
Waters service | 206,832 | 38 | % | 174,137 | 42 | % | 19 | % | ||||||||||||
Total Waters net sales | $ | 541,878 | 100 | % | $ | 414,211 | 100 | % | 31 | % | ||||||||||
Three Months Ended | ||||||||||||||||||||
April 2, 2022 | % of Total | April 3, 2021 | % of Total | % change | ||||||||||||||||
Waters instrument systems | $ | 269,962 | 44 | % | $ | 216,072 | 40 | % | 25 | % | ||||||||||
Chemistry consumables | 125,618 | 21 | % | 118,974 | 22 | % | 6 | % | ||||||||||||
Total Waters product sales | 395,580 | 65 | % | 335,046 | 62 | % | 18 | % | ||||||||||||
Waters service | 217,576 | 35 | % | 206,832 | 38 | % | 5 | % | ||||||||||||
Total Waters net sales | $ | 613,156 | 100 | % | $ | 541,878 | 100 | % | 13 | % | ||||||||||
Three Months Ended | ||||||||||||||||||||
April 3, 2021 | % of Total | March 28, 2020 | % of Total | % change | ||||||||||||||||
TA instrument systems | $ | 46,976 | 70% | $ | 34,109 | 67% | 38% | |||||||||||||
TA service | 19,691 | 30% | 16,619 | 33% | 18% | |||||||||||||||
Total TA net sales | $ | 66,667 | 100% | $ | 50,728 | 100% | 31% | |||||||||||||
Three Months Ended | ||||||||||||||||||||
April 2, 2022 | % of Total | April 3, 2021 | % of Total | % change | ||||||||||||||||
TA instrument systems | $ | 55,260 | 71 | % | $ | 46,976 | 70 | % | 18 | % | ||||||||||
TA service | 22,156 | 29 | % | 19,691 | 30 | % | 13 | % | ||||||||||||
Total TA net sales | $ | 77,416 | 100 | % | $ | 66,667 | 100 | % | 16 | % | ||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||
April 3, 2021 | March 28, 2020 | April 2, 2022 | April 3, 2021 | |||||||||||||
Net income | $ | 148,127 | �� | $ | 53,562 | $ | 159,831 | $ | 148,127 | |||||||
Depreciation and amortization | 31,356 | 29,188 | 32,664 | 31,356 | ||||||||||||
Stock-based compensation | 8,305 | 9,196 | 10,933 | 8,305 | ||||||||||||
Deferred income taxes | 2,787 | (2,525 | ) | 4,175 | 2,787 | |||||||||||
Acquired in-process research and development and othernon-cash items | 9,381 | — | ||||||||||||||
Change in accounts receivable | 7,945 | 54,026 | (907 | ) | 7,945 | |||||||||||
Change in inventories | (30,544 | ) | (29,399 | ) | (26,832 | ) | (30,544 | ) | ||||||||
Change in accounts payable and other current liabilities | (29,758 | ) | (15,825 | ) | (69,548 | ) | (29,758 | ) | ||||||||
Change in deferred revenue and customer advances | 89,048 | 46,465 | 91,514 | 89,048 | ||||||||||||
Other changes | (8,862 | ) | 6,947 | (13,251 | ) | (8,862 | ) | |||||||||
Net cash provided by operating activities | 218,404 | 151,635 | 197,960 | 218,404 | ||||||||||||
Net cash used in investing activities | (159,004 | ) | (130,175 | ) | 18,992 | (159,004 | ) | |||||||||
Net cash provided by financing activities | 188,775 | 32,918 | ||||||||||||||
Net cash used in financing activities | (227,411 | ) | 188,775 | |||||||||||||
Effect of exchange rate changes on cash and cash equivalents | (1,087 | ) | (32 | ) | (10,705 | ) | (1,087 | ) | ||||||||
Increase in cash and cash equivalents | $ | 247,088 | $ | 54,346 | ||||||||||||
(Decrease) increase in cash and cash equivalents | $ | (21,164 | ) | $ | 247,088 | |||||||||||
Item 3: | Quantitative and Qualitative Disclosures About Market Risk |
Item 4: | Controls and Procedures |
Item 1: | Legal Proceedings |
Item 1A: | Risk Factors |
Item 2: | Unregistered Sales of Equity Securities and Use of Proceeds |
Period | Total Number of Shares Purchased (1) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Programs | Maximum Dollar Value of Shares that May Yet Be Purchased Under the Programs (2) | ||||||||||||
January 1, 2022 to January 29, 2022 | 151 | $ | 332.31 | 151 | $ | 834,249 | ||||||||||
January 30, 2022 to February 26, 2022 | 181 | $ | 321.53 | 159 | $ | 782,972 | ||||||||||
February 27, 2022 to April 2, 2022 | 191 | $ | 321.45 | 183 | $ | 724,176 | ||||||||||
Total | 523 | $ | 324.61 | 493 | $ | 724,176 | ||||||||||
(1) | The Company repurchased 31 thousand shares of common stock at a cost of $10 million related to the vesting of restricted stock during the three months ended April |
(2) | In January 2019, the Company’s Board of two-year period. This program replaced the remaining amounts available under thepre-existing authorization. In December 2020, the Company’s Board of Directors authorized the extension of the share
|
Exhibit Number | Description of Document | |
31.1 | Chief Executive Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2 | Chief Financial Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1 | Chief Executive Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(*) | |
32.2 | Chief Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(*) | |
101 | The following materials from Waters Corporation’s Quarterly Report on Form 10-Q for the quarter ended April 2, 2022, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets (unaudited), (ii) the Consolidated Statements of Operations (unaudited), (iii) the Consolidated Statements of Comprehensive Income (unaudited), (iv) the Consolidated Statements of Cash Flows (unaudited) and (vi) Condensed Notes to Consolidated Financial Statements (unaudited). | |
104 | Cover Page Interactive Date File (formatted in iXBRL and contained in Exhibit 101). |
(*) | This exhibit shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any filing, except to the extent the Company specifically incorporates it by reference. |
W ATERS CORPORATION |
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