Final Results

     
BW20030904002164  20030905T060041Z UTC


( BW)(PALL-CORPORATION)(PLC) Final Results

    Business Editors
    UK REGULATORY NEWS

    EAST HILLS, N.Y--(BUSINESS WIRE)--Sept. 5, 2003--

           Pall Corporation Sales and Earnings up Strongly

Pall Corporation (NYSE: PLL) today reported sales and earnings results
for the fourth quarter and fiscal year ended August 2, 2003.

Sales for the fourth quarter increased 10% to $471.4 million including
a $29.5 million assist from favorable foreign exchange rates.
Earnings, excluding restructuring and other charges, increased 53%.
They were $56.0 million, or 45 cents per share, compared to last
year's $36.7 million, or 30 cents per share. Reported earnings for the
fourth quarter were $54.6 million, or 44 cents per share, compared to
$9.0 million or 7 cents per share last year.

For the full year, sales increased 25% to $1.614 billion compared to
$1.291 billion last year. Foreign exchange rates increased sales by
$97.6 million. Full year earnings, excluding restructuring and other
charges, increased 47%. They amounted to $148.8 million, or $1.20 per
share compared to last year's $100.9 million, or 82 cents per share.

Restructuring and other charges of $47.5 million, or 37 cents per
share (including the pro forma tax effect), were recorded in fiscal
year 2003 primarily to write off the in-process research and
development from the acquired Filtration and Separations Group
("FSG"). This reduced the results for the year to earnings of $103.2
million, or 83 cents per share, compared to $73.2 million or 59 cents
per share last year. Last year's results included restructuring and
other charges of $32.8 million, or 23 cents per share (including the
pro forma tax effect), which included a purchase accounting adjustment
of $6 million in cost of sales.

Eric Krasnoff, Pall's Chairman and CEO, said, "We have produced
another solid quarter. Sales increased 10%. Excluding restructuring
and other charges of $1.2 million, earnings and earnings per share
increased 53% and 50%, respectively. Our results exceeded analysts'
consensus estimates. Cash flow for the year was very strong and net
debt has been reduced by $174 million.

"We have achieved the three key goals set at the beginning of fiscal
year 2003. These were to improve profitability, to aggressively reduce
debt and to successfully integrate FSG into Pall. The results achieved
are well ahead of the initial targets in each of these areas.

"The end of April marked our first anniversary as the 'new Pall' with
FSG now fully integrated into our sales, marketing and technical
organizations. Our combined enterprise is now supporting more
customers with a greater range of products and services. As important,
operating margins have improved sharply to 20.8% from 17.3% in the
fourth quarter last year."

Looking at the sales results for the quarter in local currency:

"Industrial operating profit improved 33% to $46.2 million on sales
growth of 2%. Overall Aerospace sales were up 11 1/2% with Military
Aerospace sales up a strong 24% and Commercial Aerospace level. Sales
in the General Industrial segment, which serves industries including
food and beverage, water processing, chemicals and power generation,
grew 1/2%. Microelectronics' sales were off 2 1/2% after double-digit
increases in each of the first three quarters of this year.

"Turning to Life Sciences, BioPharmaceuticals grew 9% compared to last
year's fourth quarter, buoyed by strong biotechnology sales. Medical
sales increased 14% sequentially on an as reported basis over the
third quarter and were flat compared to the same quarter last year.
Fourth quarter Medical profits came in at 25.2%, building on the
pattern of sequential operating profit improvement that began with
7.8% in the first quarter."

Commenting on the quarter's earnings growth compared to last year, Mr.
Krasnoff said, "The 15 cent improvement in earnings per share is
attributable to organic growth, aided by continuing cost reduction
programs, and includes about 2 cents per share for foreign exchange
translation. We achieved the run rate necessary to accomplish our
two-year acquisition-related synergies goal of $30 million at the end
of the third quarter. Further savings are expected under the overall
umbrella of the company's 'CORE' cost reduction program. This program
will continue to play a central role in improving profitability."

Looking ahead to fiscal year 2004, Mr. Krasnoff continued, "We
anticipate this new fiscal year to be a continuation of 2003. This
means strong growth in BioPharmaceuticals and improving sales in
Medical. The industrial businesses should post modest growth with
Microelectronics continuing its slow recovery from the latest cyclical
low of the semiconductor cycle. Aerospace will continue to be our most
profitable segment but faces difficult comparisons due to the one-time
sales benefit of the Iraqi conflict. General Industrial will grow
modestly and may do better if Europe and the U.S. see more robust
economic recovery and a freeing up of capital spending. Asia will
continue to lead with double-digit growth. Overall we anticipate
earnings per share for the year to be in the range of $1.25 to $1.40.
At the mid-point, that represents a 10% increase."

Regarding quarterly earnings guidance for fiscal 2004, Mr. Krasnoff
said, "We are joining the growing trend of companies who are getting
away from providing quantitative quarterly guidance. We will of course
continue to give in depth qualitative assessment of business
conditions and expectations on a quarterly basis, but will not provide
a range of anticipated earnings per share. However, we will provide
the following starting point for this fiscal year. As is normal for
Pall, the first quarter is traditionally our smallest as far as sales
and earnings per share are concerned. We expect the first quarter to
follow the pattern of fiscal 2003 in terms of contribution to the full
year's result."

Tomorrow, September 5, 2003, at 8:30 a.m. ET, Pall Corporation will
host its quarterly earnings conference call. Individuals can access
the webcast on the home page of the Company's website, www.pall.com.
Listening to the webcast requires speakers and Microsoft Windows Media
Player audio software. The webcast will be archived for 14 days.

About Pall Corporation:

Pall Corporation is the global leader in the rapidly growing field of
filtration, separations and purification. Pall's business is organized
around two broad markets: Life Sciences and Industrial. The Company
provides leading-edge products to meet the demanding needs of
customers in biotechnology, pharmaceuticals, transfusion medicine,
semiconductors, municipal drinking water and aerospace. Total revenues
are $1.6 billion. The Company is headquartered in East Hills, New
York. Further information can be found on its Web site www.pall.com.

This release contains "forward-looking statements" as defined in the
Private Securities Litigation Reform Act of 1995. These statements are
based on current Company expectations and are subject to risks and
uncertainties, which could cause actual results to differ materially.
Such risks and uncertainties include, but are not limited to:
fluctuations in foreign currency exchange rates; regulatory approval
and market acceptance of new technologies; changes in product mix and
product pricing and in interest rates and cost of raw materials; the
Company's success in enforcing its patents and protecting its
proprietary products and manufacturing techniques; global and regional
economic conditions and legislative, regulatory and political
developments; and domestic and international competition in the
Company's global markets. Additional information regarding these and
other factors is available on the web at www.pall.com and is included
in the Company's reports filed with the U.S. Securities and Exchange
Commission. Copies of such reports can be obtained, without charge,
at: www.sec.gov.

Management uses certain non-GAAP measurements to assess Pall's current
and future financial performance. The non-GAAP measurements do not
replace the presentation of Pall's GAAP financial results. These
measurements provide supplemental information to assist management in
analyzing Pall's financial position and results of operations. Pall
has chosen to provide this information to facilitate meaningful
comparisons of past, present and future operating results and as a
means to emphasize the results of on-going operations.

PALL CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)

                                        AUG. 2,         AUG. 3,
                                         2003            2002
                                        -------         -------
Assets

Cash and short-term investments      $  149,753      $  145,424
Accounts receivable, net                423,467         415,853
Inventories, net                        274,442         256,910
Other current assets                    105,081          94,947
                                      ---------       ---------
  Total current assets                  952,743         913,134

Property, plant and equipment, net      600,153         605,095
Other assets                            463,405         492,214
                                      ---------       ---------

  Total assets                       $2,016,301      $2,010,443
                                      ---------       ---------

Liabilities and Stockholders' Equity

Short-term debt                      $   59,376      $  103,546
Accounts payable, income taxes
 and other current liabilities          357,705         331,777
                                      ---------       ---------

 Total current liabilities              417,081         435,323

Long-term debt                          494,285         619,705
Deferred taxes and other
  non-current liabilities               170,399         135,695
                                      ---------       ---------

 Total liabilities                    1,081,765       1,190,723

Stockholders' equity                    934,536         819,720
                                      ---------       ---------
  Total liabilities and
   stockholders' equity              $2,016,301      $2,010,443
                                      ---------       ---------



 PALL CORPORATION CONSOLIDATED STATEMENTS OF EARNINGS
 (Amounts in thousands, except per share data)


                    FOURTH QUARTER ENDED          YEAR ENDED
                    --------------------       -------------------
                     AUG. 2,     AUG. 3,       AUG. 2,    AUG. 3,
                      2003         2002         2003        2002
                    --------    --------       --------    --------
Net sales          $471,412    $428,889      $1,613,635  $1,290,820
Cost of sales       230,106     228,943(b)      810,039     654,889(b)
                    -------     -------         -------     -------
Gross profit        241,306     199,946         803,596     635,931


Selling, general
 and administrative
 expenses           151,833     133,554         536,194     440,025
Research and
 development         12,489      16,304          52,204      54,778
Restructuring and
 other charges, net   1,189      26,822          47,524      26,822
Interest expense,
 net                  5,200       5,663          24,438      14,331
                    -------     -------         -------     -------
Earnings before
 income taxes        70,595      17,603         143,236      99,975
Provision for
 income taxes        15,989       8,619          40,034      26,741
                    -------     -------         -------     -------

Net earnings       $ 54,606    $  8,984      $  103,202   $  73,234
                    -------     -------         -------     -------
Earnings per share:
   Basic:          $   0.44    $   0.07      $     0.84   $    0.60
                    -------     -------         -------     -------
Diluted:           $   0.44    $   0.07      $     0.83   $    0.59

Average number of
 shares outstanding:
   Basic:           124,062     122,629         123,275     122,353
   Diluted:         125,330     123,582         124,214     123,532

Net earnings
 as reported       $ 54,606    $  8,984      $  103,202   $  73,234
 Restructuring and
 other charges,
 net, after pro
 forma tax effect     1,386(a)   27,679(b)       45,591(a)   27,679
                    -------     -------         -------     -------
Pro forma earnings $ 55,992    $ 36,663      $  148,793   $ 100,913
                    -------     -------         -------     -------
Diluted earnings
 per share as
 reported          $   0.44    $   0.07      $     0.83   $    0.59
Restructuring and
 other charges,
 net               $   0.01(a) $   0.23(b)   $     0.37(a)$    0.23
                    -------     -------         -------     -------
Pro forma diluted
 earnings per
 share             $   0.45    $   0.30      $     1.20   $    0.82


 (a) Restructuring and other charges, net, for the year includes
  $37,600 (30 cents per share) of acquired in-process research and
  development and $9,924 (7 cents per share, after pro forma tax
  effect) of restructuring costs inclusive of $1,189 (1 cent per
  share, after pro forma tax effect) incurred in the fourth quarter.

 (b) Included in cost of sales is a $6,014 (3 cents per share, after
  pro forma tax effect) one-time purchase accounting adjustment.
  Restructuring and other charges, net, includes $14,495 (12 cents per
  share, after pro forma tax effect) relating to the write-down of
  investments, additions to previously established environmental
  reserves of $7,000 (4 cents per share, after pro forma tax effect)
  and restructuring costs, primarily related to the FSG acquisition,
  of $5,327 (4 cents per share, after pro forma tax effect).



 PALL CORPORATION MARKET SEGMENT AND GEOGRAPHIC INFORMATION
 (DOLLAR AMOUNTS IN THOUSANDS)

                                                           % CHANGE
 SALES                                            %        IN LOCAL
 FOURTH QUARTER ENDED:     AUG. 2,     AUG. 3,   CHANGE    CURRENCY
                            2003        2002
                           --------   --------   -------   ----------
MARKET SEGMENT
 INFORMATION:

Medical(a)                $ 95,981   $ 91,794     4 1/2        -
BioPharmaceuticals (a)     102,864     87,842    17            9
                           -------    -------    -------   ----------
Total Life Sciences        198,845    179,636    10 1/2        4 1/2
                           -------    -------    -------   ----------

General Industrial         177,893    162,336      9 1/2         1/2
Aerospace                   51,399     43,917     17          11 1/2
Microelectronics            43,275     43,000        1/2      (2 1/2)
                           -------    -------    --------  ----------
Total Industrial           272,567    249,253      9 1/2       2
                           -------    -------    --------  ----------
Total                     $471,412   $428,889     10           3



GEOGRAPHIC
INFORMATION:

SALES
TO UNAFFILIATED CUSTOMERS
-------------------------

Western
 Hemisphere               $176,738   $190,486     (7)         (8 1/2)
Europe                     192,104    165,221     16 1/2       2 1/2
Asia                       102,570     73,182     40          34
                           -------    -------     -------   ---------

Total                     $471,412   $428,889     10           3
                           -------    -------     -------   ---------

TOTAL SALES
-----------
Western
 Hemisphere               $220,971   $228,067
Europe                     217,577    184,051
Asia                       103,543     74,093
Eliminations               (70,679)   (57,322)

Total                     $471,412   $428,889

  (a) Certain prior year amounts have been reclassified to conform to
  the current year presentation.



OPERATING PROFIT
FOURTH QUARTER ENDED:          AUG. 2, 2003    %    AUG. 3, 2002   %
                               ------------   ----  ------------  ----
MARKET SEGMENT
INFORMATION:

Medical(a)                      $ 24,140      25.2    $14,689     16.0
BioPharmaceuticals(a)             27,727      27.0     24,953     28.4
                                  ------               ------
Total Life Sciences               51,867      26.1     39,642     22.1
                                  ------               ------

General Industrial                22,874      12.9     19,982     12.3
Aerospace                         15,000      29.2      9,817     22.4
Microelectronics                   8,282      19.1      4,917     11.4
                                  ------               ------
Total Industrial                  46,156      16.9     34,716     13.9
                                  ------               ------
   Subtotal                       98,023      20.8     74,358     17.3
Restructuring and other charges   (1,189)             (32,836)
                                  ------               ------
General corporate expenses       (21,039)             (18,256)
Interest expense, net             (5,200)              (5,663)
                                  ------               ------
Earnings before income taxes    $ 70,595             $ 17,603
                                  ------               ------
GEOGRAPHIC INFORMATION:

Western Hemisphere              $ 39,558      17.9   $ 35,812     15.7
Europe                            36,998      17.0     24,618     13.4
Asia                              20,760      20.0     11,263     15.2
Eliminations                         707                2,665
                                  ------               ------
   Subtotal                       98,023      20.8     74,358     17.3
Restructuring and other charges   (1,189)             (32,836)
General corporate expenses       (21,039)             (18,256)
Interest expense, net             (5,200)              (5,663)
                                  ------               ------
Earnings before income taxes    $ 70,595             $ 17,603
                                  ------               ------

  (a) Certain prior year amounts have been reclassified to conform to
  the current year presentation.




PALL CORPORATION MARKET SEGMENT AND GEOGRAPHIC INFORMATION
(DOLLAR AMOUNTS IN THOUSANDS)

                                                             % CHANGE
SALES                                              %         IN LOCAL
YEAR ENDED:               AUG. 2,     AUG. 3,    CHANGE      CURRENCY
                           2003        2002
                          -------     -------    ------      --------
MARKET SEGMENT
INFORMATION:

Medical(a)              $  317,051 $  311,037     2            (2 1/2)
BioPharmaceuticals (a)     351,874    293,809    20            12 1/2
                         ---------  ---------
Total Life Sciences        668,925    604,846    10 1/2         4 1/2
                         ---------  ---------

General Industrial         595,210    407,382    46            35
Aerospace                  185,431    158,753    17            11 1/2
Microelectronics           164,069    119,839    37            31
                         ---------  ---------
Total Industrial           944,710    685,974    37 1/2        28 1/2
                         ---------  ---------

Total                   $1,613,635 $1,290,820    25            17 1/2
                         ---------  ---------


GEOGRAPHIC INFORMATION:

SALES
TO UNAFFILIATED CUSTOMERS
-------------------------
Western
 Hemisphere             $  630,307 $  584,327     8             8
Europe                     671,660    472,569    42            24 1/2
Asia                       311,668    233,924    33            27
                         ---------  ---------
Total                   $1,613,635 $1,290,820    25            17 1/2
                         ---------  ---------

TOTAL SALES
-----------
Western
 Hemisphere             $  794,819 $  707,663
Europe                     758,717    534,289
Asia                       315,496    236,190
Eliminations              (255,397)  (187,322)
                         ---------  ---------
Total                   $1,613,635 $1,290,820
                         ---------  ---------

  (a) Certain prior year amounts have been reclassified to conform to
  the current year presentation.





OPERATING PROFIT
YEAR ENDED:                  AUG. 2,     %     AUG. 3,         %
                              2003              2002
                             -------   ----    --------      ----
MARKET SEGMENT
INFORMATION:

Medical(a)                 $  57,745   18.2    $ 43,255      13.9
BioPharmaceuticals(a)         82,207   23.4      76,511      26.0
                             -------            -------
Life Sciences                139,952   20.9     119,766      19.8
                             -------            -------

General Industrial            67,493   11.3      45,320      11.1
Aerospace                     52,593   28.4      37,489      23.6
Microelectronics              28,103   17.1       7,477       6.2
                             -------            -------
Industrial                   148,189   15.7      90,286      13.2
                             -------            -------
   Subtotal                  288,141   17.9     210,052      16.3
Restructuring and other
 charges                     (47,524)           (32,836)
General corporate expenses   (72,943)           (62,910)
Interest expense, net        (24,438)           (14,331)
                             -------            -------
Earnings before income
 taxes                     $ 143,236           $ 99,975
                             -------            -------

GEOGRAPHIC INFORMATION:

Western Hemisphere         $ 116,035   14.6    $ 87,376      12.3
Europe                       120,992   15.9      82,258      15.4
Asia                          52,269   16.6      37,437      15.9
Eliminations                  (1,155)             2,981
                             -------            -------
   Subtotal                  288,141   17.9     210,052      16.3
Restructuring and other
 charges                     (47,524)           (32,836)
General corporate expenses   (72,943)           (62,910)
Interest expense, net        (24,438)           (14,331)
                             -------            -------
Earnings before income
 taxes                     $ 143,236           $ 99,975
                             -------            -------
  (a) Certain prior year amounts have been reclassified to conform to
  the current year presentation.

   Short Name: Pall Corporation
   Category Code: FR
   Sequence Number: 00009293
   Time of Receipt (offset from UTC): 20030904T210311+0100

    --30--IS/ny*  DB/ny

    CONTACT: Pall Corporation
             John Adamovich, 516-801-9808

    KEYWORD: NEW YORK UNITED KINGDOM INTERNATIONAL EUROPE
    INDUSTRY KEYWORD: ENVIRONMENT MANUFACTURING CONFERENCE CALLS
EARNINGS
    SOURCE: Pall Corporation

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