Agilent Technologies, Inc.

Good afternoon and welcome to the Agilent Technologies fourth quarter earnings conference call. My name is Bethany and I will be the operator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. And now I'd like to introduce you to the host for today's call, Parmeet Ahuja, Vice President of Investor Relations. Sir, please go ahead.

Thank you, Bethany, and welcome everyone to Agilent's fourth quarter conference call for fiscal year 2021. With me are Mike McMullen, Agilent's President and CEO, and Bob McMahon, Agilent's Senior Vice President and CFO. Joining in the Q&A after Mike and Bob's comments will be Jacob Tyson, President of Agilent's Life Science and Applied Markets Group, Sam Raha, President of Agilent's Diagnostics and Genomics Group, and Porek McDonald, President of the Agilent Cross Lab Group. This presentation is being webcast live. The news release, investor presentation, and information to supplement today's discussion, along with the recording of this webcast, are made available on our website at www.investor.agilent.com. Today's comments by Mike and Bob will refer to non-GAAP financial measures. you will find the most directly comparable GAAP financial metrics and reconciliations on our website. Unless otherwise noted, all references to increases or decreases in financial metrics are year over year, and references to revenue growth are on a core basis. Core revenue growth excludes the impact of currency and the acquisitions and divestitures completed within the past 12 months. Guidance is based on exchange rates as of October 31. We will also make forward-looking statements about the financial performance of the company. These statements are subject to risk and uncertainties and are only valid as of today. The company assumes no obligation to update them. Please look at the company's recent SEC filings for a more complete picture of our risk and other factors. And now, I'd like to turn the call over to Mike.

Thanks, Parmeet. And thanks everyone for joining our call today. The Agilent team delivered another excellent quarter to close out an outstanding record setting 2021. At 6.32 billion for fiscal 2021, revenues are almost a billion dollars higher than last year. Full year core growth is up 15% on top of growing 1% last year. The strength is broad-based with our three business units all growing more than 10% core for the year. Our full-year operating margins are up 200 basis points. Earnings per share of $4.34 are up 32%. Let's now take a closer look at our strong finish to 2021 and review Q4 results. Our momentum continues as orders increase faster than revenue in Q4. And at the same time, we delivered our fourth straight quarter of double-digit revenue growth. At $1.66 billion, revenues are up 12% on a reported basis. Our core revenues grew 11%, exceeding our expectations. This is on top of 6% core growth last year. Our Q4 operating margin is 26.5%. This is up 160 basis points from last year. EPS is $1.21, up 23% year over year. Our earnings growth also exceeded our expectations. We continue to perform extremely well in pharma, our largest market, growing 21% driven by our biopharma business. Total pharma now represents 36% of our overall revenue. This compares to 31% of our revenues just two years ago. The strong growth in our chemical and energy business continues as we delivered 11% growth in the quarter. This is on top of growing 3% in Q4 of last year. PMI numbers are positive, and we expect that chemical energy will continue its strong growth trajectory into fiscal 2022. In diagnostics and clinical, revenues grew 11% on top of growing 1% last year as testing volumes started to recover. On a geographic basis, our results are led by a strong performance in the Americas and China. Our business in the Americas grew 15% on top of 5% last year. China grew 8% core on top of strong, 13% growth in Q4 of last year. China order growth outpaced revenue growth for the third quarter in a row. Now, looking at our performance by business unit, the Life Science and Applied Markets Group generate revenue of $747 million. LSAG is up 11% on both a reported and a core basis. LSAG's growth was broad-based and led by strength in liquid chromatography and cell analysis. The pharma and chemical energy markets were particularly strong for new instrument purchases. Our cell analysis business crossed the $100 million revenue mark in the quarter for the first time. During the quarter, the LSAG team announced a new iMobility LCQ top and enhancements to our VWorks automation software suite. These new Well-received offerings are used to improve the analysis of proteins and peptides to speed development of new protein-based therapeutics. The Aspen Cross Lab Group posted revenue of $572 million. This is up a reported 10% and 9% core. Growth is broad-based, driven by strength in service contracts and on-demand services, as well as for chemistries and supplies. Our focus on increasing connect rates continues to pay off for us. The strong expansion of our installed base in 2021 and increasing connect rates bodes well for Kenyatta's strength in our ACG business moving forward. Our ability to drive growth and leverage our scale produce operating margins of roughly 30%, up more than 200 basis points from the prior year. The Diagnostics and Genomics Group delivered revenue of $341 million, up 16% reported, and up 13% core. Our NASD oligo business led the way with robust double-digit growth in the quarter and achieved four-year revenues exceeding $225 million. We expect another year of strong double-digit growth as the team continues to do a great job of increasing throughput with the existing capacity. The expansion of our Train B oligo manufacturing facility in Frederick, Colorado is proceeding as planned. We expect this additional capacity to come online by the end of calendar year 2022. Moving on from our other business group updates, there are several other significant developments for Agile in this quarter. We announced our commitment to achieving net zero greenhouse gas emissions by 2050. We believe our approach delivers the same rigor and sustainability that we applied to everything else we do. We also believe these actions are not only the right thing to do, but fundamental to achieving long-term success. Our sustainability leadership continues to be prominently recognized as well. You may have seen that Investors Business Daily recently named Agilent to its top 100 ESG companies list. We're also a company where diversity and inclusion represent a company priority and is a core element of our culture. During the quarter, we achieved recognition by Forbes as one of the world's best employers and as the best workplace for women. While the Agilent team has a strong track record of delivering above-market growth and leading customer satisfaction, we're always looking to do more. To further accelerate growth and strengthen our focus on customers, we are implementing a new One Agilent commercial organization, combining for the first time all customer-facing activities under one leader. The new organization brings together and strengthens our sales, marketing, digital channel, and services team. The new enterprise-level commercial organization is led by Porek McDonald. Porek will continue to lead the Agilent Cross Lab Group as business group president, as well as serves Agilent's first-ever chief commercial officer. The way I like to characterize this move is to say we are doubling down on the success we've achieved with ACG, applying a holistic, customer-focused approach to all aspects of our business. We're also moving the Chemistries and Supplies Division to LSAG. This closer organizational alignment between instrument and chemistry's development will further accelerate our progress on instrument connect rates for chemistries and consumables. We believe that structure follows strategy and that this new organizational structure will further enhance our customer focus and the execution of our growth strategies. Looking ahead to the coming year, we are in a strong position to continue to deliver on our build and buy growth strategy. Agilent's business remains strong. We entered the new year with a robust backlog and have multiple growth drivers coupled with the proven execution excellence of the Agilent team. A year ago, during our Agilent Investor Day, we raised our long-term annual growth outlook to the 5% to 7% range. while reaffirming our commitment to annual operating margin improvement and double-digit EPS growth. We are now one year in and well on our way to achieving these long-term goals. Bob will provide more details, but for fiscal 2022, our initial full-year guide calls for core growth in the range of 5.5% to 7%. We expect to continue our top-line growth as we launch market-leading products and services invest in fast-growing businesses, and deliver outstanding customer service. My confidence in the unstoppable One Agilent team and our ability to execute and deliver remains firmly intact. This is our formula for delivering solid financial results, outstanding shareholder returns, and continued strong growth. We are very pleased with our performance in 2021, but not satisfied. As I tell the Agilent team, The best is yet to come for our customers, our team, and our shareholders. Thank you for being on the call today, and I look forward to your questions. I will now hand the call off to Bob. Bob?