On February 14, 2018 DelMar Pharmaceuticals, Inc. (NASDAQ: DMPI) ("DelMar" or the "Company"), a biopharmaceutical company focused on the development of new cancer therapies, reported its financial results for the second quarter ended December 31, 2017 (Press release, DelMar Pharmaceuticals, FEB 14, 2018, View Source [SID1234523968]). DelMar executive management will host a business update conference call for investors, analysts and other interested parties on Tuesday, February 20, 2018 at 4:30 p.m. Eastern Standard Time.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"This quarter has been an exciting period for DelMar. Our priority is to leverage VAL-083’s unique mechanism of action to efficiently advance it into the most promising indications, including MGMT-unmethylated glioblastoma and platinum-resistant ovarian cancer. We now have a revised VAL-083 development strategy that is focused on MGMT methylation status in glioblastoma, which has become routine in clinical practice as a biomarker which correlates with resistance to the standard-of-care chemotherapy with temozolomide (Temodar "TMZ"), and patient outcomes. We believe using this biomarker will allow us to optimize patient selection for treatment with our lead drug candidate, VAL-083, thereby streamlining development and enhancing opportunities for success in our clinical development programs," commented Saiid Zarrabian, Interim President and Chief Executive Officer.

KEY DEVELOPMENTS AND UPDATED STRATEGIC PLAN

Evaluation of MGMT promoter methylation status has increasingly become common practice in the diagnostic assessment of glioblastoma multiforme (GBM). DelMar believes that this provides it with an enhanced ability to leverage MGMT methylation as a biomarker to optimize patient selection for DelMar’s novel DNA-targeting agent in the treatment of GBM.
The National Comprehensive Cancer Network (NCCN), provided updated guidelines for the standard treatment of GBM based on MGMT methylation status. DelMar believes these recently published guidelines may allow the Company to capitalize on VAL-083’s unique mechanism of action and activity in the estimated 60 percent of GBM patients whose tumors are MGMT-unmethylated.
The U.S. Food and Drug Administration (FDA) allowed a second Investigational New Drug Application (IND) to enable DelMar to study its lead drug candidate, VAL-083, as a potential treatment for ovarian cancer.
In November 2017, at the annual meeting of the Society for NeuroOncology (SNO), DelMar presented a positive interim update from its ongoing open label Phase 2 clinical trial in patients with MGMT-unmethylated recurrent GBM (rGBM) whose tumors have recurred following treatment with temozolomide (Avastin naïve). This study, which was initiated in February 2017, is being conducted at the University of Texas MD Anderson Cancer Center.
In December 2017, the FDA fully approved Avastin (bevacizumab) which may impact our ability to recruit suitable patients for our STAR-3 Phase 3 clinical trial.
In December 2017, the FDA granted Fast Track designation for VAL-083, in recurrent glioblastoma.
Based on the above developments, and other factors as stated in DelMar’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2017 (10-Q) filed with the Securities and Exchange Commission (SEC) on February 14, 2018, DelMar has decided to put the STAR-3 program on hold for up to 12 months and will suspend further site or patient enrollment. This will allow DelMar to fully evaluate the possible impact of Avastin’s recent approval by the FDA on patient enrollment for this study, and possible protocol amendments, non-dilutive financing sources, as well as to increase focus on the MGMT-unmethylated clinical studies currently underway as further described in the SEC filings. During this interim evaluation period, DelMar will continue to provide treatment to patients already enrolled in the STAR-3 trial, and consider, on a case-by-case basis, and subject to required institutional and regulatory approvals, providing VAL-083 to patients in accordance with our expanded access policy
Based on this updated strategy, DelMar believes it has cash available into the second quarter of calendar 2019.
For further details on the Company’s operating and financial results, as well as more detail about its updated strategy, refer to DelMar’s 10-Q filed with the SEC on February 14, 2018, View Source

CONFERENCE CALL DETAILS

DelMar plans to host a conference call to discuss its financial results for the quarter ended December 31, 2017 and provide a corporate update on Tuesday, February 20, 2018, at 4:30 p.m. Eastern Time. For both "listen-only" participants and those who wish to take part in the question and answer portion of the call, the telephone Dial-in Number is 1 888 632 3384 (toll free) with Conference ID DELMAR.

A replay of the conference call will be available on the IR Calendar of the Investors section of the Company’s website at www.delmarpharma.com and will be archived for 30 days.

SUMMARY OF FINANCIAL RESULTS FOR THE PERIOD ENDED DECEMBER 31, 2017

At December 31, 2017, the Company had cash and clinical trial deposits on hand of approximately $12.0 million (unaudited).

For the three months ended December 31, 2017, the Company reported a net loss of $3,161,598 or $0.14 per share, compared to a net loss of $1,321,973, or $0.13 per share, for the three months ended December 31, 2016. For the six months ended December 31, 2017, the Company reported a net loss of $5,828,004 or $0.31 per share, compared to a net loss of $3,612,312, or $0.36 per share, for the six months ended December 31, 2016.

The following represents selected financial information as of December 31, 2017. The Company’s financial information has been prepared in accordance with U.S. GAAP and this selected information should be read in conjunction with DelMar’s consolidated financial statements and management’s discussion and analysis ("MD&A"), as filed.

DelMar’s financial statements as filed with the U.S. Securities Exchange Commission can be viewed on the company’s website at: View Source

Selected Balance Sheet Data

December 31,
2017
$

June 30,

2017

$

Cash

11,021,568

6,586,014

Working capital

9,959,948

6,566,371

Total assets

12,216,116

7,911,021

Derivative liability

5,549

61,228

Total stockholders’ equity

9,983,574

6,578,524

Selected Statement of Operations Data

For the three months ended:

December 31,

December 31,

2017

2016

$

$

Research and development

2,141,945

1,120,910

General and administrative

1,011,879

571,286

Change in fair value of stock option and derivative liabilities

889

(361,668)

Foreign exchange loss (gain)

7,120

(8,495)

Interest income

(235)

(60)

Net and comprehensive loss for the period

3,161,598

1,321,973

Series B Preferred stock dividend

54,066

159,756

Net and comprehensive loss available to common stockholders

3,215,664

1,481,729

Basic weighted average number of shares outstanding

22,559,234

11,424,485

Basic and fully diluted loss per share

0.14

0.13

Excluding the impact of non-cash expense, research and development expenses increased to $2,015,570 during the current quarter compared to $1,186,637 for the same period in the prior year. The increase was largely attributable to an increase in clinical development costs related to the three clinical studies ongoing for VAL-083, as well as personnel, and preclinical research costs. Excluding the impact of non-cash expenses, general and administrative expenses increased in the quarter ended December 31, 2017 to $909,747 from $580,761 for the quarter ended December 31, 2016.

For the six months ended:

December 31,

December 31,

2017

2016

$

$

Research and development

4,076,588

1,853,639

General and administrative

1,756,500

1,887,925

Change in fair value of stock option and derivative liabilities

(55,679)

(135,980)

Foreign exchange loss

50,986

6,829

Interest income

(391)

(101)

Net and comprehensive loss for the period

5,828,004

3,612,312

Series B Preferred stock dividend

95,732

467,054

Net and comprehensive loss available to common stockholders

5,923,736

4,079,366

Basic weighted average number of shares outstanding

18,882,259

11,363,237

Basic and fully diluted loss per share

0.31

0.36

Excluding the impact of non-cash expense, research and development expenses increased to $3,955,187 during the six months ended December 31, 2017 compared to $1,863,529 for the same period in the prior year. The increase was largely attributable to VAL-083 clinical development and manufacturing costs related to the Company’s STAR-3 refractory-GBM clinical trial and two Phase 2 clinical trials in MGMT-unmethylated GBM.

Excluding the impact of non-cash expenses, general and administrative expenses increased in the current six months to $1,586,005 compared to $1,307,175 for the six months ended December 31, 2016.

We believe, based on our current estimates, that we will be able to fund our operations into the second quarter of calendar year 2019.

On February 14, 2018 Dynavax Technologies Corporation (NASDAQ:DVAX) reported that Eddie Gray, Dynavax’s chief executive officer, will participate in a fireside chat at the 2018 RBC Capital Markets Global Healthcare Conference in New York City (Press release, Dynavax Technologies, FEB 14, 2018, View Source [SID1234523969]). The presentation will be webcast live and will occur on Wednesday, February 21, 2018 at 1:35 p.m. ET.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

The live or replayed versions of the webcast will be available by visiting the "Investors" section of the Dynavax website at www.dynavax.com.

On February 14, 2018 Oncolytics Biotech Inc. (TSX: ONC) (OTCQX: ONCYF), a biotech company developing REOLYSIN, also known as pelareorep, an intravenously delivered immuno-oncolytic virus that activates the innate and adaptive immune systems to turn "cold" tumors "hot", reported that it will present at the RBC Capital Markets 2018 Healthcare Conference (Press release, Oncolytics Biotech, FEB 14, 2018, View Source [SID1234524037]). The presentation, by Dr. Matt Coffey, President & CEO of Oncolytics, will take place at 3:05 pm ET, on Wednesday, February 21, 2018 in the Kennedy II Room on the fourth floor of The Lotte New York Palace Hotel. The conference takes place on February 21st & 22nd in New York, NY.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We are excited to provide an update on our recent progress as we work toward executing on several important milestones this year," said Dr. Matt Coffey, President & CEO of Oncolytics. "Building on last year’s momentum, we continue to pursue Breakthrough Therapy Designation and Special Protocol Assessment as we prepare to initiate our phase 3 registration study of REOLYSIN in metastatic breast cancer before the end of September this year. In addition to our regulatory and clinical work we anticipate being able to announce the results of our vote on a share consolidation – our final step in relisting on NASDAQ – and are pursuing attractive partnership opportunities."

A live audio link to the webcast session will be available on the Company’s website at View Source It is recommended that listeners log on 10 minutes in advance of a live session to register and download any necessary software. An audio replay will be accessible approximately two hours following the presentation on the Oncolytics website.

On February 14, 2018 Exelixis, Inc. (NASDAQ: EXEL) reported that Michael M. Morrissey, Ph.D., the company’s President and Chief Executive Officer, will provide an overview of the company at the RBC Capital Markets Global Healthcare Conference taking place February 21-22 in New York, NY (Press release, Exelixis, FEB 14, 2018, View Source;p=RssLanding&cat=news&id=2332513 [SID1234523970]). The Exelixis presentation is scheduled for 11:30 a.m. EST / 8:30 a.m. PST on Wednesday, February 21, 2018.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

To access the webcast link, log onto www.exelixis.com and proceed to the News & Events / Event Calendar page under the Investors & Media heading. Please connect to the company’s website at least 15 minutes prior to the presentation to ensure adequate time for any software download that may be required to listen to the webcast. A replay will also be available at the same location for 14 days.

On February 14, 2018 Agilent Technologies, Inc. (NYSE: A) today reported revenue of $1.21 billion for the first-quarter ended January 31, 2018, up 14 percent year over year (up 10 percent on a core basis(2)) (Press release, Agilent, FEB 14, 2018, http://www.agilent.com/about/newsroom/presrel/2018/14feb-gp18028.html [SID1234524147]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

On a GAAP basis, including the $533 million charge related to U.S. Tax Reform legislation, first-quarter net loss was $320 million, or $0.99 net loss per share. Last year’s first-quarter GAAP net income was $168 million, or $0.52 per share.

During the first quarter, Agilent had an adjustment related to U.S. Tax Reform of $533 million, intangible amortization of $25 million, a pension settlement gain of $5 million, transformation costs of $5 million, acquisition and integration costs of $3 million, and $3 million in other costs. Excluding these items and a tax benefit of $28 million, Agilent reported first-quarter non-GAAP net income of $216 million, or $0.66 per share(1).

"We are very pleased with our strong start to the year," said Mike McMullen, Agilent CEO and President. "The Agilent team continued our positive momentum and delivered another excellent quarter of operating results."

"Looking forward, we will keep our focus on driving sustainable above-market growth and delivering value to shareholders through the execution of our proven strategy," continued McMullen. "Overall, we are well-positioned to continue delivering excellent operating results."

First-quarter revenue of $618 million from Agilent’s Life Sciences and Applied Markets Group (LSAG) grew 14 percent year over year (up 11 percent on a core basis(2)), with broad strength across all major end markets. LSAG’s operating margin for the quarter was 25.8 percent.

First-quarter revenue of $408 million from Agilent CrossLab Group (ACG) grew 12 percent year over year (up 9 percent on a core basis(2)). Growth was strong across services and consumables. ACG’s operating margin for the quarter was 21.6 percent.

First-quarter revenue of $185 million from Agilent’s Diagnostics and Genomics Group (DGG) grew 13 percent year over year (up 8 percent on a core basis(2)) led by strong demand for pathology products and companion diagnostics services. DGG’s operating margin for the quarter was 11.7 percent.

Agilent expects second-quarter 2018 revenue in the range of $1.20 billion to $1.22 billion. Second-quarter 2018 non-GAAP earnings are expected to be in the range of $0.61 to $0.63 per share(3).

For fiscal year 2018, Agilent expects revenue of $4.885 billion to $4.905 billion and non-GAAP earnings of $2.62 to $2.68 per share(3). The guidance is based on January 31, 2018 currency exchange rates.

Conference Call

Agilent’s management will present more details about its first-quarter fiscal 2018 financial results on a conference call with investors today at 1:30 p.m. (Pacific Time). This event will be webcast live in listen-only mode. Listeners may log on at www.investor.agilent.com and select "Q1 2018 Agilent Technologies Inc. Earnings Conference Call" in the "News & Events — Calendar of Events" section. The webcast will remain available on the company’s website for 90 days.

Additional information regarding financial results can be found at www.investor.agilent.com by selecting "Financial Results" in the "Financial Information" section.

A telephone replay of the conference call will be available at approximately February 14, 2018 at 4:30 p.m. (Pacific Time) after the call and through February 21 by dialing +1 855-859-2056 (or +1 404-537-3406 from outside the United States) and entering pass code 1482568.

# # #

Financial Statements for First-Quarter Fiscal 2018

AGILENT TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In millions, except per share amounts)
(Unaudited)
PRELIMINARY

Three Months Ended
January 31, Percent
2018 2017 Inc/(Dec)

Net revenue $ 1,211 $ 1,067 14 %

Costs and expenses:
Cost of products and services 538 493 9 %
Research and development 93 79 18 %
Selling, general and administrative 341 289 18 %
Total costs and expenses 972 861 13 %

Income from operations 239 206 16 %

Interest income 9 4 125 %
Interest expense (20 ) (20 ) —
Other income (expense), net 5 3 67 %

Income before taxes 233 193 21 %

Provision for income taxes 553 25 —

Net income (loss) $ (320 ) $ 168 —

Net income (loss) per share:
Basic $ (0.99 ) $ 0.52
Diluted $ (0.99 ) $ 0.52

Weighted average shares used in computing net income (loss) per share:
Basic 323 322
Diluted 323 326

Cash dividends declared per common share $ 0.149 $ 0.132

The preliminary income statement is estimated based on our current information.

Page 1

AGILENT TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
(In millions)
(Unaudited)
PRELIMINARY

Three Months Ended
January 31,
2018 2017

Net income (loss) $ (320 ) $ 168

Other comprehensive income (loss), net of tax:

Unrealized gain (loss) on derivative instruments (7 ) 1
Foreign currency translation 79 (3 )
Net defined benefit pension cost and post retirement plan costs:
Change in actuarial net loss 6 17
Change in net prior service benefit (1 ) (1 )
Other comprehensive income 77 14

Total comprehensive income (loss) $ (243 ) $ 182

The preliminary statement of comprehensive income is estimated based on our current information.

Page 2

AGILENT TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(In millions, except par value and share amounts)
(Unaudited)
PRELIMINARY

January 31, October 31,
2018 2017
ASSETS

Current assets:
Cash and cash equivalents $ 2,887 $ 2,678
Accounts receivable, net 751 724
Inventory 608 575
Other current assets 151 192
Total current assets 4,397 4,169

Property, plant and equipment, net 792 757
Goodwill 2,633 2,607
Other intangible assets, net 341 361
Long-term investments 140 138
Other assets 395 394
Total assets $ 8,698 $ 8,426

LIABILITIES AND EQUITY

Current liabilities:
Accounts payable $ 292 $ 305
Employee compensation and benefits 221 276
Deferred revenue 321 291
Short-term debt 345 210
Other accrued liabilities 182 181
Total current liabilities 1,361 1,263

Long-term debt 1,800 1,801
Retirement and post-retirement benefits 241 234
Other long-term liabilities 770 293
Total liabilities 4,172 3,591

Total Equity:
Stockholders’ equity:
Preferred stock; $0.01 par value; 125 million shares authorized; none issued and outstanding

— —
Common stock; $0.01 par value, 2 billion shares authorized; 323 million shares at January 31, 2018 and 322 million shares at October 31, 2017, issued

3 3
Treasury stock at cost; 37 thousand shares at January 31, 2018 and zero shares at October 31, 2017

(3 ) —
Additional paid-in-capital 5,320 5,300
Accumulated deficit (529 ) (126 )
Accumulated other comprehensive loss (269 ) (346 )
Total stockholders’ equity 4,522 4,831
Non-controlling interest 4 4
Total equity 4,526 4,835
Total liabilities and equity $ 8,698 $ 8,426

The preliminary balance sheet is estimated based on our current information.

Page 3

AGILENT TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(In millions)
(Unaudited)
PRELIMINARY

Three Months Ended
January 31, January 31,
2018 2017
Cash flows from operating activities:
Net income (loss) $ (320 ) $ 168

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization 51 55
Share-based compensation 31 20
Excess and obsolete inventory related charges 5 7
Other non-cash expenses, net 1 2
Changes in assets and liabilities:
Accounts receivable, net (5 ) (31 )
Inventory (34 ) (26 )
Accounts payable (3 ) 9
Employee compensation and benefits (62 ) (43 )
Change in assets and liabilities due to Tax Reform 533 —
Other assets and liabilities 18 (45 )
Net cash provided by operating activities (a) 215 116

Cash flows from investing activities:
Investments in property, plant and equipment (60 ) (32 )
Payment to acquire cost method investments (1 ) —
Proceeds from divestitures — 1
Acquisition of businesses and intangible assets, net of cash acquired (6 ) (70 )
Net cash used in investing activities (67 ) (101 )

Cash flows from financing activities:
Issuance of common stock under employee stock plans 25 18
Payment of taxes related to net share settlement of equity awards (28 ) (12 )
Payment of dividends (48 ) (42 )
Proceeds from debt and revolving credit facility 274 131
Repayment of debt and revolving credit facility (139 ) (42 )
Treasury stock repurchases (47 ) (111 )
Net cash provided by (used in) financing activities 37 (58 )

Effect of exchange rate movements 24 (5 )

Net increase (decrease) in cash and cash equivalents 209 (48 )

Cash and cash equivalents at beginning of period 2,678 2,289

Cash and cash equivalents at end of period $ 2,887 $ 2,241

(a) Cash payments included in operating activities:
Income tax payments, net $ 32 $ 27
Interest payments $ 29 $ 29

The preliminary cash flow is estimated based on our current information.

Page 4

AGILENT TECHNOLOGIES, INC.
NON-GAAP NET INCOME AND DILUTED EPS RECONCILIATIONS
(In millions, except per share amounts)
(Unaudited)
PRELIMINARY

Three Months Ended
January 31,
2018
Diluted
EPS

2017
Diluted
EPS

GAAP net (loss) income $ (320 ) $ (0.99 ) (b) $ 168 $ 0.52
Non-GAAP adjustments:
Intangible amortization 25 0.08 31 0.10
Transformational initiatives 5 0.02 2 0.01
Acquisition and integration costs 3 0.01 16 0.05
Pension settlement gain (5 ) (0.02 ) (32 ) (0.11 )
NASD site costs 2 0.01 — —
Special compliance costs 1 — — —
Other — — 2 0.01
Adjustment for Tax Reform

533 1.63 — —
Adjustment for taxes (a) (28 ) (0.08 ) (15 ) (0.05 )
Non-GAAP net income $ 216 $ 0.66 (c) $ 172 $ 0.53

(a) The adjustment for taxes excludes tax benefits that management believes are not directly related to on-going operations and which are either isolated or cannot be expected to occur again with any regularity or predictability. For the three months ended January 31, 2018, management uses a non-GAAP effective tax rate of 18.0%. In the same periods last year, management used a non-GAAP effective tax rate of 19.0%.

(b) GAAP diluted net loss per share was computed using 323 million weighted average diluted shares which excludes from consideration the anti-dilutive effects of all potential common shares outstanding.

(c) Non-GAAP diluted net income per share was computed using 327 million weighted average diluted shares which includes the dilutive effects of potential common shares outstanding.

We provide non-GAAP net income and non-GAAP net income per share amounts in order to provide meaningful supplemental information regarding our operational performance and our prospects for the future. These supplemental measures exclude, among other things, charges related to amortization of intangibles, transformational initiatives, acquisition and integration costs, pension settlement gain, NASD site costs, special compliance costs, and adjustment for Tax Reform.

Transformational initiatives include expenses associated with targeted cost reduction activities such as manufacturing transfers, small site consolidations, legal entity and other business reorganizations, insourcing or outsourcing of activities. Such costs may include move and relocation costs, one-time termination benefits and other one-time reorganization costs. Included in this category are also expenses associated with the post-separation resizing of the IT infrastructure and streamlining of IT system as well as company programs to transform our product lifecycle management (PLM) system and financial systems.

Acquisition and Integration costs include all incremental expenses incurred to effect a business combination. Such acquisition costs may include advisory, legal, accounting, valuation, and other professional or consulting fees. Such integration costs may include expenses directly related to integration of business and facility operations, the transfer of assets and intellectual property, information technology systems and infrastructure and other employee-related costs.

Pension settlement gain resulted from transfer of the substitutional portion of our Japanese pension plan to the government.

NASD site costs include all the costs related to the expansion of our manufacturing of nucleic acid active pharmaceutical ingredients incurred prior to the commencement of commercial manufacturing.

Special compliance costs include costs associated with transforming our processes to implement new regulations such as the EU’s General Data Protection Regulation (GDPR), revenue recognition and certain tax reporting requirements.

Other includes certain legal costs and settlements in addition to other miscellaneous adjustments.

Adjustment for Tax Reform primarily consists of an estimated provision of $480 million for U.S. transition tax and correlative items on deemed repatriated earnings of non-U.S. subsidiaries and an estimated provision of $53 million associated with the decrease in the U.S. corporate tax rate from 35% to 21% and its impact on our U.S. deferred tax assets and liabilities. The taxes payable associated with the transition tax, net of tax attributes, on deemed repatriation of foreign earnings is approximately $440 million, payable over 8 years. The final impact of Tax Reform may differ materially from these estimates, due to, among other things, changes in interpretations, analysis and assumptions made, additional guidance that may be issued, and actions that we may undertake.

Our management uses non-GAAP measures to evaluate the performance of our core businesses, to estimate future core performance and to compensate employees. Since management finds this measure to be useful, we believe that our investors benefit from seeing our results "through the eyes" of management in addition to seeing our GAAP results. This information facilitates our management’s internal comparisons to our historical operating results as well as to the operating results of our competitors.

Our management recognizes that items such as amortization of intangibles can have a material impact on our cash flows and/or our net income. Our GAAP financial statements including our statement of cash flows portray those effects. Although we believe it is useful for investors to see core performance free of special items, investors should understand that the excluded items are actual expenses that may impact the cash available to us for other uses. To gain a complete picture of all effects on the company’s profit and loss from any and all events, management does (and investors should) rely upon the GAAP income statement. The non-GAAP numbers focus instead upon the core business of the company, which is only a subset, albeit a critical one, of the company’s performance.

Readers are reminded that non-GAAP numbers are merely a supplement to, and not a replacement for, GAAP financial measures. They should be read in conjunction with the GAAP financial measures. It should be noted as well that our non-GAAP information may be different from the non-GAAP information provided by other companies.

The preliminary non-GAAP net income and diluted EPS reconciliation is estimated based on our current information.

Page 5

AGILENT TECHNOLOGIES, INC.
SEGMENT INFORMATION
(In millions, except where noted)
(Unaudited)

PRELIMINARY

Life Sciences and Applied Markets Group
Q1’18 Q1’17
Revenue $ 618 $ 540
Gross Margin, % 61.8 % 59.6 %
Income from Operations $ 159 $ 126
Operating margin, % 25.8 % 23.4 %

Diagnostics and Genomics Group
Q1’18 Q1’17
Revenue $ 185 $ 164
Gross Margin, % 54.4 % 54.8 %
Income from Operations $ 22 $ 23
Operating margin, % 11.7 % 14.3 %

Agilent CrossLab Group
Q1’18 Q1’17
Revenue $ 408 $ 363
Gross Margin, % 50.6 % 48.5 %
Income from Operations $ 88 $ 74
Operating margin, % 21.6 % 20.3 %

Income from operations reflect the results of our reportable segments under Agilent’s management reporting system which are not necessarily in conformity with GAAP financial measures. Income from operations of our reporting segments exclude, among other things, charges related to amortization of intangibles, business exit and divestiture costs, transformational initiatives, acquisition and integration costs, pension settlement gain, NASD site costs, and special compliance costs.

Readers are reminded that non-GAAP numbers are merely a supplement to, and not a replacement for, GAAP financial measures. They should be read in conjunction with the GAAP financial measures. It should be noted as well that our non-GAAP information may be different from the non-GAAP information provided by other companies.

The preliminary segment information is estimated based on our current information.

AGILENT TECHNOLOGIES, INC.
RECONCILIATIONS OF REVENUE BY SEGMENT EXCLUDING
ACQUISITIONS, DIVESTITURES AND THE IMPACT OF CURRENCY ADJUSTMENTS (CORE)
(in millions)
(Unaudited)
PRELIMINARY

Year-over-Year

GAAP
Year-over-Year
GAAP Revenue by Segment

Q1’18 Q1’17 % Change

Life Sciences and Applied Markets Group $ 618 $ 540 14 %

Diagnostics and Genomics Group 185 164 13 %

Agilent CrossLab Group 408 363 12 %

Agilent $ 1,211 $ 1,067 14 %

Non-GAAP
(excluding Acquisitions & Divestitures)

Currency
Adjustments

Currency
Adjustments

Currency-Adjusted (a)
Year-over-Year Year-over-Year
Non GAAP Revenue by Segment

Q1’18 Q1’17 % Change Q1’18 Q1’17 Q1’18 Q1’17 % Change

Life Sciences and Applied Markets Group $ 616 $ 539 14 % $ (3 ) $ (17 ) $ 619 $ 556 11 %

Diagnostics and Genomics Group 182 163 12 % (1 ) (7 ) 183 170 8 %

Agilent CrossLab Group 408 363 12 % (3 ) (15 ) 411 378 9 %

Agilent (Core) $ 1,206 $ 1,065 13 % $ (7 ) $ (39 ) $ 1,213 $ 1,104 10 %

(a) We compare the year-over-year change in revenue excluding the effect of recent acquisitions and divestitures and foreign currency rate fluctuations to assess the performance of our underlying business. To determine the impact of currency fluctuations, current and prior year period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the actual exchange rate in effect during the last month of the current period.

The preliminary reconciliation of GAAP revenue adjusted for recent acquisitions and divestitures and impact of currency is estimated based on our current information.