WASHINGTON, July 23 /PRNewswire-FirstCall/ -- Danaher Corporation
(NYSE: DHR) announced today that net earnings for the quarter ended
July 3, 2009 were $296 million, or $0.89 per diluted share, an
18.5% decrease as compared to the Company's 2008 second quarter net
earnings of $363 million, or $1.09 per diluted share. Included in
the net earnings and diluted earnings per share are certain
discrete credits and charges that are summarized in the attached
supplemental schedule. Sales for the 2009 second quarter were $2.67
billion, 18.5% less than the $3.28 billion reported for the 2008
second quarter. Core revenues declined 15% in the quarter, compared
to the second quarter of 2008. Net earnings for the first six
months of 2009 were $533 million, or $1.61 per diluted share,
compared with net earnings of $640 million, or $1.92 per diluted
share for the first six months of 2008. Sales for the first six
months of 2009 were $5.30 billion compared to $6.31 billion for the
first six months of 2008, a decrease of 16%. H. Lawrence Culp, Jr.,
President and Chief Executive Officer, stated, "We continue to
experience significant headwinds across most of our businesses and
end markets due to the weak global economy. Despite these
challenging conditions, we are encouraged by our strong margin and
free cash flow performance. Our free cash flow was $438 million in
the quarter, with a free cash flow to net income conversion ratio
of 148%. As a result of the difficult operating environment, we
continue to aggressively implement our cost reduction activities
across the company, which when combined with our focus on capturing
share gains in a down market, should position us well for the
balance of 2009 and beyond." Danaher will discuss its results
during its investor conference call today starting at 8:00 a.m.
EDT. The call and an accompanying slide presentation will be
webcast on the "Investors" section of Danaher's website at
http://www.danaher.com/. A replay of the webcast can be accessed on
the "Investors" section of Danaher's website (under the subheading
"Investor Events") shortly after the conclusion of the
presentation, and the webcast will remain available until the next
quarterly earnings call. The conference call can be accessed by
dialing 877-856-1964 or 719-325-4765 a few minutes before the 8:00
a.m. EDT start and telling the operator that you are dialing in for
Danaher's investor conference call, access code 7112404. A replay
of the conference call will be available shortly after the
conclusion of the call until July 28, 2009 and you can access the
replay by dialing 888-203-1112 or 719-457-0820, access code
7112404. In addition, related presentation materials have been
posted to the "Investors" section of Danaher's website under the
subheading "Earnings". 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 cost
reduction activities, focus on capturing share gains, expectations
for the balance of 2009 and future periods 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 global 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, the contractions or growth rates and cyclicality of
markets we serve, our ability to expand our business in new
markets, our ability to successfully identify, consummate and
integrate appropriate acquisitions, the impact of our debt
obligations on our operations, 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, risks relating to potential impairment of goodwill
and other long-lived assets, currency exchange rates, pension plan
costs, commodity costs and surcharges, labor matters, our
relationships with and the performance of our channel partners, our
ability to achieve projected efficiencies, cost reductions, sales
growth and earnings, and international economic, political, legal
and business factors. 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 2008 Annual Report on Form 10-K and Quarterly Report
on Form 10-Q for the quarter ended July 3, 2009. These
forward-looking statements speak only as of the date of this
release and the Company does not assume any obligation to update
any forward-looking statement. To download a copy of the full
earnings report, please go to http://www.danaher.com/. DANAHER
CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS ($ and
shares in thousands, except per share amounts) (unaudited) Three
Months Ended Six Months Ended July 3, June 27, July 3, June 27,
2009 2008 2009 2008 $2,673,609 $3,283,895 $5,301,353 $6,312,769
Sales Operating costs and expenses: Cost of sales 1,411,340
1,723,596 2,780,475 3,334,754 Selling, general and Administrative
expenses 759,823 859,969 1,517,318 1,678,359 Research and
development expenses 158,500 189,866 319,395 375,970 Total
operating expenses 2,329,663 2,773,431 4,617,188 5,389,083
Operating profit 343,946 510,464 684,165 923,686 Interest expense
(31,329) (33,854) (55,386) (74,523) Interest income 1,126 1,412
1,791 4,934 Earnings before income taxes 313,743 478,022 630,570
854,097 Income taxes (18,049) (114,574) (97,164) (214,144) Net
earnings $295,694 $363,448 $533,406 $639,953 Net earnings per
share: Basic $0.93 $1.14 $1.67 $2.01 Diluted $0.89 $1.09 $1.61
$1.92 Average common stock and common equivalent shares
outstanding: Basic 319,916 319,233 319,626 319,018 Diluted 334,540
336,551 334,010 336,263 See the accompanying Notes to Consolidated
Condensed Financial Statements. A complete copy of Danaher's Form
10-Q financial statements is available on the Company's website
(http://www.danaher.com/). Danaher Corporation Supplemental Summary
of Certain Discrete Credits and (Charges) Included in Net Earnings
and Diluted Net Earnings Per Share Three Months and Six Months
Ended July 3, 2009 and June 27, 2008 ($ in 000's except per share
data) Three Months Ended Six Months Ended July 3, June 27, % July
3, June 27, % 2009 2008 Change 2009 2008 Change Net Earnings per
GAAP $295,694 $363,448 -18.6% $533,406 $639,953 -16.6% The
following items are included in Net Earnings per GAAP above:
Additional restructuring activities approved by the Company on
April 21, 2009 totaling $34.0 million pre-tax for both the three
and six months ended July 3, 2009 (included as part of the total
restructuring charges incurred by the Company of $46 million and
$56 million for the three and six months ended July 3, 2009,
respectively). (25,500) (25,500) Transaction costs expensed in 2009
in connection with acquisitions (adoption of FAS 141R - $3.5
million pre-tax) and fair value adjustments to recorded inventory
and deferred revenue balances related to 2009 acquisitions ($3.0
million pre-tax for the three months and six months ended July 3,
2009) and 2008 acquisitions ($13.5 million & $39.6 million
pre-tax for the three months and six months ended June 27, 2008,
respectively). (4,820) (10,015) (4,820) (29,176) Gains from net
reduction in income tax reserves and discrete tax benefits 60,500
8,500 60,500 8,215 Diluted Net Earnings Per Share per GAAP $0.89
$1.09 -18.3% $1.61 $1.92 -16.1% The following items are included in
Diluted Net Earnings per Share per GAAP noted above. Additional
restructuring activities approved by the Company on April 21, 2009
totaling $34.0 million pre-tax for both the three and six months
ended July 3, 2009. (0.08) (0.08) Transaction costs expensed in
2009 in connection with acquisitions and fair value adjustments to
recorded inventory and deferred revenue balances related to both
2009 and 2008 acquisitions. (0.01) (0.03) (0.01) (0.09) Gains from
net reduction in income tax reserves and discrete tax benefits 0.18
0.03 0.18 0.03 Danaher Corporation Supplemental Reconciliation of
Revenue Growth (GAAP) to Core Revenue Growth (Non-GAAP) Three and
Six Months Ended July 3, 2009 Three Months Six Months Ended Ended
July 3, 2009 July 3, 2009 vs. Comparable vs. Comparable Components
of Sales Growth 2008 Period 2008 Period Core -15.0% -13.0%
Acquisitions 2.0% 2.5% Impact of currency translation -5.5% -5.5%
Total -18.5% -16.0% Danaher Corporation Supplemental Reconciliation
of Operating Cash Flows (GAAP) to Free Cash Flow (Non-GAAP) and
Free Cash Flow to Net Income Conversion Ratio Three and Six Months
Ended July 3, 2009 ($ in 000's) Three Months Six Months Ended Ended
July 3, 2009 July 3, 2009 vs. Comparable vs. Comparable 2008 Period
2008 Period Operating Cash Flow (GAAP) $485,665 $802,344 Less:
Purchases of Property, Plant and Equipment (47,535) (83,943) Free
Cash Flow (Non-GAAP) 438,130 718,401 Net Income (GAAP) 295,694
533,406 Free Cash Flow to Net Income Conversion Ratio (Non-GAAP)
148% 135% Notes to Non-GAAP Reconciliation Schedule 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) Core revenue
(presented on a stand-alone basis), which is defined as revenue
from businesses that have been owned for one year or more,
excluding the effects of foreign currency fluctuations. (2) Free
cash flow, which is defined as operating cash flow less purchases
of property, plant and equipment. We also present our free cash
flow to net income conversion ratio. Core revenue should be
considered in addition to, and not as a replacement for or superior
to, revenue. Free cash flow should be considered in addition to,
and not as a replacement for or superior to, operating cash flow.
Danaher may define these non-GAAP measures differently than the way
in which similar non-GAAP measures are defined by other companies.
Danaher's management believes that core revenue reflects an
additional way of viewing aspects of Danaher's operations that,
when viewed with and reconciled to revenue calculated in accordance
with GAAP, provides a more complete understanding of Danaher's
results of operations and helps identify underlying trends in
Danaher's business. Core revenue 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 core revenue 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 core revenue helps 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 this measure 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. Similarly,
Danaher's management believes that free cash flow reflects an
additional way of viewing aspects of Danaher's operations that,
when viewed with and reconciled to operating cash flow, provides
useful information to investors regarding Danaher's ability to
generate cash without external financings. Danaher's management
uses free cash flow to help gauge the resources available for
strategic opportunities such as making acquisitions, investing in
the business and strengthening the balance sheet, and uses this
measure in making operating decisions, allocating financial
resources and for budget planning purposes. Danaher's management
believes that the free cash flow measure helps investors and
others, if they so choose, in understanding and evaluating
Danaher's ability to generate cash without external financings in
the same manner as management does. In addition, Danaher believes
that analysts and others in the investment community use free cash
flow to assess the strength of Danaher's earnings performance and
gauge Danaher's ability to strengthen its balance sheet, invest in
the business and grow the business through acquisitions and other
strategic opportunities. A general limitation of the non-GAAP
measures used in this release is that use of these measures (as
compared to revenue and operating cash flow, respectively) may
reduce comparability with other companies who may calculate these
non-GAAP measures differently. A particular limitation of core
revenue is that it excludes items that can significantly impact our
revenues. A particular limitation of free cash flow is that it does
not take into account the Company's debt service requirements and
other non-discretionary expenditures and therefore is not
necessarily indicative of amounts of cash that may be available for
discretionary uses. Danaher's management compensates, and believes
that investors should compensate, for these and other limitations
of core revenue and free cash flow by also considering Danaher's
revenue and operating cash flow, respectively. DATASOURCE: Danaher
Corporation CONTACT: Matt R. McGrew, Vice President, Investor
Relations of Danaher Corporation, +1-202-828-0850, Fax:
+1-202-828-0860 Web Site: http://www.danaher.com/
Copyright