Dionex Corp. F2Q08 (Qtr End 12/31/07) Earnings Call

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2008-02-01 17:34:15.0

Tags: Dionex Corp.

Question-and-Answer Session

Operator

Thank you. (Operator Instructions)

Our first question will come from Richard Eastman with Robert W. Baird. Please go head.

Richard Eastman - Robert W. Baird

Hi, just wanted to ask you a couple of questions, Lukas. On the product mix itself, against that 11% overall local currency growth rate, did consumables match that growth?

Lukas Braunschweiler

Hi, Ric, it's Lukas. Yes, that was perfectly inline.

Richard Eastman - Robert W. Baird

Okay. So you saw 11 percentage growth in local currency, both on equipment side and consumables, And then from your commentary?

Lukas Braunschweiler

That portfolio group was very balanced this quarter, instrument, service, software and consumables.

Richard Eastman - Robert W. Baird

Okay. And then I just have a question, I mean, this is going to come up and it has come up. But again, relative to the geographic dispersion of the business, how did Japan do for you in the quarter? And then secondly, you had referenced some pharma softness presumably on the HPLC side of the business in Europe. Can you just maybe address those two pockets of underperformance?

Lukas Braunschweiler

Sure. Japan, we were pleased with Japan. We grew in fact in Q2 in the high single-digits. And the business seems to be very stable there and under control. We are even pretty positive for the next quarter, as you know this is the fiscal year end in Japan and we expect a few good orders to come. So, Japan sure not on the growth level like the bodies around Japan in Asia/Pacific, but a very solid performance.

The second question you had was very specific. Basically, it was a base effect issue in Europe on the pharma, we have to be fair, we had good broad based growth from pharma across, basically, all the products, if we exclude a few large software order we got in the quarter a year ago. I want to mention is the big Novartis Chromeleon upgrade order we got a year ago, hit us, bookings and probably sales rise exactly in that time. So, we had some steep challenges also, but when we exclude those extra orders a year before, then the picture looks better.

Richard Eastman - Robert W. Baird

I see. Okay. And then just one last question. On the gross profit margin, how do you feel about the efficiencies that you gained on the HPLC side of the business with the new UltiMate platform, do you feel that any gains in margin there are going to be from scale or have you worked out all the bugs in the manufacturing?

 

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