WASHINGTON, Jan. 26 /PRNewswire-FirstCall/ -- Danaher Corporation
(NYSE: DHR) announced results for the fourth quarter and year ended
December 31, 2008. Net earnings for the fourth quarter were $305.7
million, or $0.92 per diluted share. Included in the fourth quarter
results are certain non-cash charges related to the acquisition of
Tektronix for fair value adjustments to recorded inventory and
deferred revenue which reduced net earnings by approximately $5
million or $0.01 per diluted share, as well as after-tax charges of
approximately $62 million or $0.18 per diluted share related to
previously announced restructuring activities. Absent these two
items, adjusted earnings per diluted share was $1.11, essentially
flat versus last year's adjusted earnings per diluted share from
continuing operations of $1.12. Sales from continuing operations
for the 2008 fourth quarter were $3.18 billion, 1% higher than the
$3.14 billion reported for the 2007 fourth quarter. Net earnings
for the full year 2008 were $1.3 billion, or $3.95 per diluted
share. Included in the full year 2008 earnings per diluted share
are the fourth quarter 2008 items noted above, as well as the
non-cash charges recorded in the first three quarters of 2008
related to the acquisition of Tektronix for fair value adjustments
to recorded inventory and deferred revenue which reduced net
earnings by approximately $0.12 per diluted share and gains from
the net reduction in income tax reserves and discrete tax benefits
of approximately $0.03 per diluted share. Absent these items,
adjusted earnings per diluted share were $4.23, an increase of
10.5% compared to the 2007 full year adjusted earnings per diluted
share from continuing operations of $3.83. Sales from continuing
operations for 2008 were $12.7 billion compared to $11 billion for
2007, an increase of 15%. Attached is a reconciliation of adjusted
diluted net earnings per share from continuing operations to
diluted net earnings per share from continuing operations
calculated according to GAAP, for the three and twelve month
periods ended December 31, 2008 and the comparable prior year
periods. H. Lawrence Culp, Jr., President and Chief Executive
Officer, stated, "The dramatic downturn in the global economy in
the latter part of 2008 negatively impacted a number of our
businesses, our end markets and our customers. In spite of these
unprecedented headwinds we were able to deliver a solid 2008
performance. Core revenues decreased 1% in the quarter and
increased 2.5% for the full year. Operating cash flow from
continuing operations in 2008 was a record $1.9 billion,
representing a 9.5% increase over our record 2007 performance.
While we expect 2009 to be a difficult year, we believe our solid
portfolio of businesses, our strong balance sheet and the Danaher
Business System will provide our experienced team the opportunity
to outperform." Danaher Corporation is a leading manufacturer of
Professional Instrumentation, Medical Technologies, Industrial
Technologies, and Tools and Components (http://www.danaher.com/).
Statements in this release that are not strictly historical,
including the statements regarding expectations for 2009 and any
other statements regarding events or developments that we believe
or anticipate will or may occur in the future, may be
"forward-looking" statements. There are a number of important
factors that could cause actual events to differ materially from
those suggested or indicated by such forward-looking statements.
These factors include, among other things, the current economic
recession and the upheaval in the credit markets and financial
services industry, competition, our ability to develop and
successfully market new products and technologies, our ability to
expand our business in new markets, our ability to identify,
consummate and integrate appropriate acquisitions, litigation and
other contingent liabilities including intellectual property and
environmental matters, our compliance with applicable laws and
regulations and changes in applicable laws and regulations, tax
audits and changes in our tax rate, currency exchange rates,
commodity costs and surcharges, our relationships with and the
performance of our channel partners, our ability to achieve
projected efficiencies, cost reductions, sales growth and earnings,
economic and other conditions in the end-markets we sell into, and
general domestic and international economic conditions. Additional
information regarding the factors that may cause actual results to
differ materially from these forward-looking statements is
available in our SEC filings, including our 2007 Annual Report on
Form 10-K and Third Quarter 2008 Quarterly Report on Form 10-Q.
These forward-looking statements speak only as of the date of this
release and the Company does not assume any obligation or intend to
update any forward-looking statement. DANAHER CORPORATION AND
SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS ($ in thousands,
except per share amounts) Three Months Ended Year Ended 12/31/08
12/31/07 12/31/08 12/31/07 Sales $3,176,506 $3,141,177 $12,697,456
$11,025,917 Operating costs and expenses: Cost of sales 1,724,897
1,690,647 6,757,262 5,985,022 Selling, general and administrative
expenses 860,491 769,178 3,345,274 2,713,097 Research and
development expenses 167,467 216,582 725,443 601,424 Other (income)
expense - - - (14,335) Total operating expenses 2,752,855 2,676,407
10,827,979 9,285,208 Operating profit 423,651 464,770 1,869,477
1,740,709 Interest expense (25,433) (32,793) (130,174) (109,702)
Interest income 4,000 2,735 10,004 6,092 Earnings from continuing
operations before income taxes 402,218 434,712 1,749,307 1,637,099
Income taxes (96,532) (114,487) (431,676) (423,101) Earnings from
continuing operations 305,686 320,225 1,317,631 1,213,998 Earnings
from discontinued operations, net of income taxes - - - 155,906 Net
earnings $305,686 $320,225 $1,317,631 $1,369,904 Earnings per share
from continuing operations: Basic $0.96 $1.02 $4.13 $3.90 Diluted
$0.92 $0.97 $3.95 $3.72 Earnings per share from discontinued
operations: Basic - - - $0.50 Diluted - - - $0.47 Net earnings per
share: Basic $0.96 $1.02 $4.13 $4.40 Diluted $0.92 $0.97 $3.95
$4.19 Average common stock and common equivalent shares
outstanding: Basic 319,523 315,437 319,361 311,225 Diluted 333,593
334,013 335,863 329,459 This information is presented for reference
only. Final audited financial statements will include footnotes,
which should be referenced when available, to more fully understand
the contents of this information. DANAHER CORPORATION AND
SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of December 31 ($and
shares in thousands) ASSETS 2008 2007 Current Assets: Cash and
equivalents $392,854 $239,108 Trade accounts receivable, less
allowance for doubtful accounts of $120,730 and $108,781,
respectively 1,894,585 1,984,384 Inventories 1,142,309 1,193,615
Prepaid expenses and other current assets 757,371 632,660 Total
current assets 4,187,119 4,049,767 Property, plant and equipment,
net 1,108,653 1,108,634 Other assets 432,257 507,550 Goodwill
9,210,581 9,241,011 Other intangible assets, net 2,519,422
2,564,973 Total assets $17,458,032 $17,471,935 LIABILITIES AND
STOCKHOLDERS' EQUITY Current Liabilities: Notes payable and current
portion of long-term debt $66,159 $330,480 Trade accounts payable
1,108,961 1,125,600 Accrued expenses and other liabilities
1,534,575 1,443,773 Total current liabilities 2,709,695 2,899,853
Other long-term liabilities 2,386,605 2,090,630 Long-term debt
2,553,170 3,395,764 Stockholders' equity: Common stock - $0.01 par
value, 1 billion shares authorized; 354,487 and 352,608 issued;
318,380 and 317,984 outstanding, respectively 3,544 3,526
Additional paid-in capital 1,812,963 1,718,716 Retained earnings
8,095,155 6,820,756 Accumulated other comprehensive income
(103,100) 542,690 Total stockholders' equity 9,808,562 9,085,688
Total liabilities and stockholders' equity $17,458,032 $17,471,935
This information is presented for reference only. Final audited
financial statements will include footnotes, which should be
referenced when available, to more fully understand the contents of
this information. DANAHER CORPORATION AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF CASH FLOWS Year Ended December 31 ($ in thousands)
2008 2007 Cash flows from operating activities: Net earnings
$1,317,631 $1,369,904 Less: earnings from discontinued operations,
net of tax - 155,906 Net earnings from continuing operations
1,317,631 1,213,998 Non-cash items, net of the effect of
discontinued operations: Depreciation 193,997 173,942 Amortization
145,290 94,550 Stock compensation expense 86,000 73,347 Change in
deferred income taxes 27,691 29,870 Change in trade accounts
receivable, net 71,403 (72,555) Change in inventories 33,119 38,094
Change in accounts payable 3,713 103,800 Change in prepaid expenses
and other assets (4,773) 38,601 Change in accrued expenses and
other liabilities (15,042) 5,661 Total operating cash flows from
continuing operations 1,859,029 1,699,308 Total operating cash
flows from discontinued operations - (53,533) Net cash flows from
operating activities 1,859,029 1,645,775 Cash flows from investing
activities: Payments for additions to property, plant and equipment
(193,783) (162,071) Proceeds from disposals of property, plant and
equipment 1,088 15,537 Cash paid for acquisitions (423,208)
(3,576,562) Cash paid for investment in acquisition target and
other marketable securities - (23,219) Proceeds from sale of
investment and divestitures - 301,278 Proceeds from refundable
escrowed purchase price 48,504 - Total investing cash flows from
continuing operations (567,399) (3,445,037) Total investing cash
flows from discontinued operations - (722) Net cash used in
investing activities (567,399) (3,445,759) Cash flows from
financing activities: Proceeds from issuance of common stock 82,430
733,028 Payment of dividends (38,259) (34,275) Purchase of treasury
stock (74,165) (117,486) Net (repayments) proceeds of borrowings
(maturities of 90 days or less) (905,567) 647,761 Proceeds of
borrowings (maturities longer than 90 days) 72,652 493,705
Repayments of borrowings (maturities longer than 90 days) (259,344)
(10,563) Net cash (used in) generated by financing activities
(1,122,253) 1,712,170 Effect of exchange rate changes on cash and
equivalents (15,631) 9,112 Net change in cash and equivalents
153,746 (78,702) Beginning balance of cash and equivalents 239,108
317,810 Ending balance of cash and equivalents $392,854 $239,108
This information is presented for reference only. Final audited
financial statements will include footnotes, which should be
referenced when available, to more fully understand the contents of
this information. DANAHER CORPORATION AND SUBSIDIARIES SEGMENT
INFORMATION ($ in thousands, unaudited) Sales Three Months Ended
Year Ended 12/31/08 12/31/07 12/31/08 12/31/07 Professional
Instrumentation $1,243,949 $1,097,511 $4,860,764 $3,537,912 Medical
Technologies 843,820 866,311 3,277,026 2,997,986 Industrial
Technologies 777,932 812,435 3,265,451 3,153,377 Tools &
Components 310,805 364,920 1,294,215 1,336,642 $3,176,506
$3,141,177 $12,697,456 $11,025,917 Operating Profit Professional
Instrumentation $221,960 $175,227 $907,254 $709,502 Medical
Technologies 90,134 132,863 370,473 393,230 Industrial Technologies
106,569 132,046 522,112 532,477 Tools & Components 30,343
43,211 157,673 175,634 Other (25,355) (18,577) (88,035) (70,134)
$423,651 $464,770 $1,869,477 $1,740,709 Operating Margins
Professional Instrumentation 17.8% 16.0% 18.7% 20.1% Medical
Technologies 10.7% 15.3% 11.3% 13.1% Industrial Technologies 13.7%
16.3% 16.0% 16.9% Tools & Components 9.8% 11.8% 12.2% 13.1%
Total 13.3% 14.8% 14.7% 15.8% Restructuring & Other Related
Charges Professional Instrumentation $28,813 - $28,813 - Medical
Technologies 26,081 - 26,081 - Industrial Technologies 23,093 -
23,093 - Tools & Components 3,978 - 3,978 - Total $81,965 -
$81,965 - Restructuring Cost Classification Cost of sales $33,130 -
$33,130 - Selling, general and administrative expenses 48,835 -
48,835 - $81,965 - $81,965 - This information is presented for
reference only. Final audited financial statements will include
footnotes, which should be referenced when available, to more fully
understand the contents of this information Danaher Corporation
Supplemental Reconciliation of Net Earnings from Continuing
Operations and Diluted Net Earnings Per Share from Continuing
Operations (GAAP) to Adjusted Net Earnings from Continuing
Operations and Adjusted Diluted Net Earnings Per Share from
Continuing Operations (Non-GAAP) Three Months and Years Ended
December 31, 2008 and December 31, 2007 ($in 000's except per share
data) Three Months Ended Years Ended December December % December
December % 31, 2008 31, 2007 Change 31, 2008 31, 2007 Change Net
Earnings from Continuing Operations per GAAP $305,686 $320,225
-4.5% $1,317,631 $1,213,998 8.5% After-tax charges for purchased
in-process research and development and fair value adjustments to
recorded inventory and deferred revenue balances related to the
acquisition of Tektronix ($6.9 million & $59.5 million pre-tax
for the three months and year ended December 31, 2007) 5,150 66,000
44,465 66,000 After-tax charge related to fourth quarter 2008
restructuring actions and related charges ($82.0 million pre-tax).
61,500 - 61,500 - Gains from net reduction in income tax reserves
and discrete tax benefits (1,160) (14,562) (9,524) (21,084)
After-tax gain on indemnity proceeds related to litigation matter
($12.5 million pre-tax) - - - (8,110) Adjusted Net Earnings from
Continuing Operations (Non-GAAP) $371,176 $371,663 -0.1% $1,414,072
$1,250,804 13.1% Diluted Net Earnings Per Share from Continuing
Operations per GAAP $0.92 $0.97 -5.2% $3.95 $3.72 6.2% After-tax
charges for purchased in-process research and development and fair
value adjustments to recorded inventory and deferred revenue
balances related to the acquisition of Tektronix ($6.9 million
& $59.5 million pre-tax for the three months and year ended
December 31, 2007) 0.01 0.20 0.13 0.20 After-tax charge related to
fourth quarter 2008 restructuring actions and related charges
($82.0 million pre-tax). 0.18 - 0.18 - Gains from net reduction in
income tax reserves and discrete tax benefits - (0.05) (0.03)
(0.07) After-tax gain on indemnity proceeds related to litigation
matter ($12.5 million pre-tax) - - - (0.02) Adjusted Diluted Net
Earnings Per Share from Continuing Operations (Non-GAAP) $1.11
$1.12 -0.9% $ 4.23 $3.83 10.4% Danaher Corporation Supplemental
Reconciliation of Revenue Growth (GAAP) to Revenue Growth from
Existing Businesses (Non-GAAP) Three Months Ended December 31, 2008
and December 31, 2007 Three Months Ended Year Ended December 31,
2008 vs. December 31, 2008 vs. Comparable 2007 Comparable 2007
Period Period Components of Sales Growth Existing Businesses -1.0%
2.5% Acquisitions 6.0% 10.5% Impact of currency translation -4.0%
2.0% Total 1.0% 15.0% Notes to Non-GAAP Reconciliation Schedule
General In addition to the results provided in this release in
accordance with U.S. Generally Accepted Accounting Principles
("GAAP"), the Company has provided the following non-GAAP measures:
(1) Adjusted net earnings from continuing operations for the three
months and year ended December 31, 2008 and December 31, 2007 and
adjusted net earnings from continuing operations per diluted share
for the three months and year ended December 31, 2008 and December
31, 2007. These measures are calculated on a basis which: -- in the
2008 period, exclude (a) certain non-cash charges related to the
acquisition of Tektronix, Inc. for fair value adjustments to
recorded inventory and deferred revenue balances, (b) gains related
to a reduction of income tax reserves and discrete tax benefits and
(c) charges related to fourth quarter 2008 restructuring actions
and related charges; and -- in the 2007 period, exclude (a) gains
related to a reduction of income tax reserves and discrete tax
benefits, and (b) the gain on indemnity proceeds received in
connection with a litigation matter and (c) certain non-cash
charges for purchased in-process research and development and fair
value adjustments to recorded inventory and deferred revenue
balances related to the acquisition of Tektronix. The Company also
discloses the year-over-year percentage change in these non-GAAP
measures. Collectively, these non-GAAP measures are referred to as
the "non-GAAP earnings measures". (2) Core revenue growth from
existing businesses (presented on a stand-alone basis), which is
defined as revenue growth from businesses that have been owned for
one year or more, excluding the effects of foreign currency
fluctuations. The non-GAAP measures should be considered in
addition to, and not as a replacement for or superior to, the
comparable GAAP measures. Danaher's non-GAAP measures may be
defined differently than similar non-GAAP measures that are used by
other companies. Non-GAAP earnings measures and revenue growth from
existing businesses Danaher's management believes that the non-GAAP
earnings measures and revenue growth from existing businesses
reflect additional ways of viewing aspects of Danaher's operations
that, when viewed with and reconciled to the corresponding GAAP
measures, provide a more complete understanding of Danaher's
results of operations and help identify underlying trends in
Danaher's business. The items that have been excluded from the
non-GAAP earnings measures have been excluded because items of this
nature and size occur with inconsistent frequency and for reasons
that may be unrelated to Danaher's commercial performance during
the period, and we believe are not indicative of Danaher's ongoing
operating costs or gains in a given period. Similarly, revenue
growth from existing businesses excludes items that are not
completely under management's control, such as the impact of
changes in foreign currency exchange rates, and items that do not
reflect the underlying growth of the company, such as acquisition
and divestiture activity. Danaher's management uses these non-GAAP
measures in assessing current performance against prior period
performance and against forecasted performance, in forecasting
financial results for future periods, and in making decisions about
internal budgets, resource allocation and financial goals for its
business units. Danaher's management believes that these non-GAAP
measures help investors and others, if they so choose, in
understanding and evaluating Danaher's current operating
performance and future prospects in the same manner as management
does. In addition, Danaher believes that analysts and others in the
investment community use these non-GAAP measures to assess
Danaher's performance against prior period performance and against
forecasted performance, compare Danaher's performance to the
performance of our peer companies, identify trends in Danaher's
performance and provide estimates of future performance. A general
limitation of these non-GAAP measures is that use of these measures
(as compared to the related GAAP measures of net earnings from
continuing operations, revenue and revenue growth) may reduce
comparability with other companies who may calculate similar
non-GAAP measures differently. A particular limitation of the
non-GAAP earnings measures is that they exclude charges that can
significantly affect Danaher's results of operations and that may
recur in the course of Danaher's business (though at times and in
amounts that may be difficult to predict). Similarly, a particular
limitation of revenue growth from existing businesses is that it
excludes items that can significantly impact our revenues. Danaher
management compensates, and believes that investors should
compensate, for these and other limitations of these non-GAAP
measures by also considering Danaher's financial results as
determined in accordance with GAAP, including the GAAP measures
described above in this paragraph. DATASOURCE: Danaher Corporation
CONTACT: Andy Wilson, Vice President, Investor Relations, Danaher
Corporation, +1-202-828-0850 Web Site: http://www.danaher.com/
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