June 8, 2009 - Beckman Coulter Inc. (BEC-NYSE) provides biomedical testing instrument systems, tests, and supplies for clinical laboratories worldwide. The company manufactures chemistry systems, routine chemistry systems that use electrochemical detection, chemical reactions with patient samples to detect and quantify substances of diagnostic interest in blood, urine, and other body fluids; and point of care testing products comprising rapid diagnostic test kits and hematology instruments that give physicians information to manage patients.

In addition, BeckmanCoulter offers cellular systems for clinicians, such as hematology systems to study formed elements in blood, such as red and white bloodcells and platelets; coagulation systems offering information to diagnose bleeding and clotting disorders and to monitor anticoagulant therapy; and flow cytometry systems used in applications in basic research, clinical research, and drug discovery. The company's lifescience products and services comprise life sciences automation products, centrifugation, and life science tools.

It sells through sales organizations and independent distributors to hospitals, physician's offices, reference laboratories, pharmaceutical and biotechnology companies, universities, medical schools, and research institutions. The company was formerly known as Beckman Instruments, Inc. and changed its name to Beckman Coulter, Inc. in April 1998 after the acquisition of Coulter Corporation. Beckman Coulter was founded in 1934 and is headquartered in Fullerton, California.

What caught my eye about Beckman is that sales are projected to be down a little this year but earnings are predicted to be higher. So this company is being affected by the economic slowdown, but management isn't using that as an excuse for lower earnings. It's managing the company through this downturn, making it more efficient. That bodes well for profits when the economy recovers.

Specifically, revenues for 2009 are expected to be $3.08 billion, down slightly from the $3.10 billion hit in 2008. Sales in 2006 were $2.53 billion, then went to $2.76 billion in 2007. As for earnings per share, look for $3.81 this year, up from $3.63 last year. Then in 2010, 10 analysts have a consensus earnings estimate of $4.21. Next quarterly earnings are due on July 30 and should be 83 cents a share, down from 89 cents a share in the same quarter last year.

Beckman's been buying other companies. In February of this year, it agreed to acquire the diagnostic systems division of Olympus Life Sciences for about $800 million. That expands Beckman's reach into larger hospital labs for chemistry tests. Furthermore, the new division expands its chemistry customers and presents a new client list for its immunoassay products (also known as cross selling). That purchase should add $500 million in annual sales and generate $50 million to $60 million in cost savings from merger related efficiencies. The FTC has approved the deal, and analysts see consummation in the third quarter of this year. It will be financed with stock and some debt. Another recent purchase: the $17 million buy of Clinical Data's Cogenics group which adds to Beckman's sequencing business.

The increase in profits, as sales slip briefly, comes from cost containment and a product mix with emphasis on higher-margined recurring revenues generated by the clinical diagnostics group. Looking ahead, the future looks pretty bright as several new products are about to be launched. One example: the Gallios flow cytometer for research groups, the first in a series of cytometry products scheduled for sale this year.

More numbers: Market Cap is $3.5 billion. Forward P/E is 13. Price to Book is 2.36. Book Value is $23.48. Profit Margin is 5.7% while Operating Margin is 11.33%. Total Cash is $147.7 million; that's $2.33 a share in cash. Total debt is $838.4 million. Current ratio is 2.35. 52-week high was hit on August 15, 2008 at $77.14; the 52-week low was $35.94 on December 15 of 2008. There are 63.35 million shares outstanding with a float of 61.44. Insiders own 1.53% of the stock. Institution have 7.60%. There is an annual dividend of 68 cents for a yield of 1.2%.

Beckman's stock did well for several years, not suffering the fate of most stocks, until the latter part of last year. Then, like the rest of the market, it got clobbered in a very short period of time (from August to December), losing more than half its value. It's rebounding now but still a long way from the all time high set last year of $77.10. It could keep going if the global economy begins to heal. But even without an economic rebound, there's no question that the products BEC offers will stay in demand as more and more testing is needed for a population that continues to age.

- Company Web site: www.beckmancoulter.com

- Ted Allrich