Exhibit 99.1
DANAHER CORPORATION
2099 PENNSYLVANIA AVENUE, N.W.
12TH FLOOR
WASHINGTON, D.C. 20016
TELEPHONE (202)-828-0850 FAX (202)-828-0860
|
FOR IMMEDIATE RELEASE |
|
CONTACT: Andy Wilson |
|
|
|
VP – Investor Relations |
|
|
|
(202) 828-0850 |
DANAHER CORPORATION REPORTS RECORD
WASHINGTON, D.C., January 29, 2004 — Danaher Corporation (NYSE:DHR) announced today results for the fourth quarter and year ended December 31, 2003. Net earnings for the fourth quarter of 2003, including the impact of a gain related to the curtailment of the Company’s cash balance pension plan of $0.09 per share, were $169.9 million, or $1.06 per diluted share, compared with $161.7 million, or $1.03 per diluted share for the fourth quarter of 2002, including the effect of unusual items. Net earnings for the fourth quarter of 2003, excluding the pension curtailment gain, were $155.4 million, or $0.97 per diluted share, a 23% increase over the comparable earnings per share amount for 2002. Excluding the effect of unusual items, net earnings for the 2002 fourth quarter were $124.4 million, or $0.79 per diluted share. As indicated in the reconciliation presented below, the unusual items affecting the fourth quarter of 2002 include benefits resulting from unused reserves associated with restructuring programs announced in the fourth quarter of 2001, a lower effective income tax rate and the reduction of income tax reserves related to a previously discontinued operation. Sales for the 2003 fourth quarter were $1,488.8 million compared to $1,275.0 million for the fourth quarter of 2002, an increase of 17%.
Net earnings for the full year 2003 including the effect of all unusual items were $536.8 million, or $3.37 per diluted share, compared with $290.4 million, or $1.88 per diluted share for 2002 (which includes a charge of $173.8 million or $1.10 per share related to a change in accounting principles). For 2003, net earnings excluding the effect of unusual items were $521.7 million, or $3.28 per diluted share, a 20% increase over comparable earnings per share for 2002. Excluding the effect of unusual items, earnings for the full year 2002 were $426.1 million, or $2.74 per diluted share. The unusual items impacting the full year 2003 included the pension curtailment gain as well as gains on the sale of real estate. The unusual items impacting the full year 2002 included the items described above with respect to the 2002 fourth quarter as well as a change in accounting principles and gains on the sale of real estate. Sales for 2003 were $5,293.9 million compared to $4,577.2 million in 2002, an increase of 16%.
H. Lawrence Culp, Jr., President and Chief Executive Officer, stated, “We are pleased to report record fourth quarter and full year results. Total sales for the quarter grew 17%, including a 6% increase in revenues from existing businesses, the largest such increase since the third quarter of 2000. We experienced strong gains in both our process/environmental controls and our tools and components segments. We have again achieved record cash flow with 2003 operating cash flow totaling $861.5 million, a 21% increase over the 2002 level of $710.3 million. As signs of an economic recovery become more broad-based, we are again optimistic about our ability to outperform in 2004.”
Danaher Corporation is a leading manufacturer of Process/Environmental Controls and Tools and Components. (www.danaher.com)
Statements in this release, including the attachments to this release, that are not strictly historical may be “forward-looking” statements, which involve risks and uncertainties. These include risks and uncertainties relating to customer and supplier relationships and prices, competition, market demand, litigation and other contingent liabilities, the integration and operation of acquired businesses, and economic, political, governmental and technological factors affecting the Company’s operations, markets, products, services and prices, among others, as set forth in the Company’s SEC filings.
DANAHER CORPORATION AND SUBSIDIARIES
(in thousands, except per share amounts)
|
|
|
Quarter Ended |
|
Year Ended |
|
||||||||
|
|
|
12/31/03 |
|
12/31/02 |
|
12/31/03 |
|
12/31/02 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Net earnings before unusual items |
|
$ |
155,377 |
|
$ |
124,443 |
|
$ |
521,675 |
|
$ |
426,061 |
|
|
Pension curtailment gain, net of tax |
|
14,625 |
|
— |
|
14,625 |
|
— |
|
||||
|
Gains (losses) on sale of real estate, net of tax |
|
(56 |
) |
609 |
|
534 |
|
3,940 |
|
||||
|
Effect of lower tax rate on prior quarters (A) |
|
— |
|
2,520 |
|
— |
|
— |
|
||||
|
After-tax impact of restructuring charge |
|
— |
|
4,140 |
|
— |
|
4,140 |
|
||||
|
Reduction of tax reserves related to previously discontinued operation |
|
— |
|
30,000 |
|
— |
|
30,000 |
|
||||
|
Effect of accounting change, net of tax, SFAS 142 |
|
— |
|
— |
|
— |
|
(173,750 |
) |
||||
|
|
|
|
|
|
|
|
|
|
|
||||
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Net earnings |
|
$ |
169,946 |
|
$ |
161,712 |
|
$ |
536,834 |
|
$ |
290,391 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Diluted net earnings per share before unusual items |
|
$ |
0.97 |
|
$ |
0.79 |
|
$ |
3.28 |
|
$ |
2.74 |
|
|
Pension curtailment gain, net of tax |
|
0.09 |
|
— |
|
0.09 |
|
— |
|
||||
|
Gains on sale of real estate, net of tax |
|
— |
|
— |
|
— |
|
0.02 |
|
||||
|
Effect of lower tax rate on prior quarters (A) |
|
— |
|
0.02 |
|
— |
|
— |
|
||||
|
After-tax impact of restructuring charge |
|
— |
|
0.03 |
|
— |
|
0.03 |
|
||||
|
Reduction of tax reserves related to previously discontinued operation |
|
— |
|
0.19 |
|
— |
|
0.19 |
|
||||
|
Effect of accounting change, net of tax, SFAS 142 |
|
— |
|
— |
|
— |
|
(1.10 |
) |
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Diluted net earnings per share |
|
$ |
1.06 |
|
$ |
1.03 |
|
$ |
3.37 |
|
$ |
1.88 |
|
(A) Represents the effect on the fourth quarter of 2002 of lowering the full year effective income tax rate to 34% from 34.5% used during the first three quarters of 2002.
DANAHER CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(in thousands, except per share amounts)
|
|
|
Quarter Ended |
|
Year Ended |
|
||||||||
|
|
|
12/31/03 |
|
12/31/02 |
|
12/31/03 |
|
12/31/02 |
|
||||
|
Net sales |
|
$ |
1,488,778 |
|
$ |
1,274,978 |
|
$ |
5,293,876 |
|
$ |
4,577,232 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Cost of sales |
|
884,499 |
|
769,435 |
|
3,154,809 |
|
2,791,175 |
|
||||
|
Selling, general and administrative |
|
364,670 |
|
305,872 |
|
1,316,357 |
|
1,097,365 |
|
||||
|
(Gains) losses on sale of real estate |
|
83 |
|
(952 |
) |
(785 |
) |
(6,157 |
) |
||||
|
Gain on pension plan curtailment |
|
(22,500 |
) |
|
|
(22,500 |
) |
|
|
||||
|
Restructuring expenses |
|
— |
|
(6,273 |
) |
— |
|
(6,273 |
) |
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total operating expenses |
|
1,226,752 |
|
1,068,082 |
|
4,447,881 |
|
3,876,110 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Operating profit |
|
262,026 |
|
206,896 |
|
845,995 |
|
701,122 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Interest expense |
|
(15,046 |
) |
(14,497 |
) |
(59,049 |
) |
(53,926 |
) |
||||
|
Interest Income |
|
2,941 |
|
3,346 |
|
10,089 |
|
10,272 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Earnings before income taxes |
|
249,921 |
|
195,745 |
|
797,035 |
|
657,468 |
|
||||
|
Income taxes |
|
79,975 |
|
64,033 |
|
260,201 |
|
223,327 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Net earnings before effect of accounting change and reduction of income tax reserves |
|
169,946 |
|
131,712 |
|
536,834 |
|
434,141 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Reduction of income tax reserves related to previously discontinued operation |
|
— |
|
30,000 |
|
— |
|
30,000 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Effect of accounting change, net of tax, adoption of SFAS No. 142 |
|
— |
|
— |
|
— |
|
(173,750 |
) |
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Net earnings |
|
$ |
169,946 |
|
$ |
161,712 |
|
$ |
536,834 |
|
$ |
290,391 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Basic net earnings per share: |
|
|
|
|
|
|
|
|
|
||||
|
Net earnings before effect of accounting change and reduction of income tax reserves |
|
$ |
1.10 |
|
$ |
0.87 |
|
$ |
3.50 |
|
$ |
2.89 |
|
|
Add: Reduction of income tax reserves |
|
— |
|
0.20 |
|
— |
|
0.20 |
|
||||
|
Less: Effect of accounting change |
|
— |
|
— |
|
— |
|
(1.16 |
) |
||||
|
Net earnings |
|
$ |
1.10 |
|
$ |
1.07 |
|
$ |
3.50 |
|
$ |
1.93 |
|
|
Diluted net earnings per share: |
|
|
|
|
|
|
|
|
|
||||
|
Net earnings before effect of accounting change and reduction of income tax reserves |
|
$ |
1.06 |
|
$ |
0.84 |
|
$ |
3.37 |
|
$ |
2.79 |
|
|
Add: Reduction of income tax reserves |
|
— |
|
0.19 |
|
— |
|
0.19 |
|
||||
|
Less: Effect of accounting change |
|
— |
|
— |
|
— |
|
(1.10 |
) |
||||
|
Net earnings |
|
$ |
1.06 |
|
$ |
1.03 |
|
$ |
3.37 |
|
$ |
1.88 |
|
|
Average common stock and common equivalent shares outstanding: |
|
|
|
|
|
|
|
|
|
||||
|
Basic |
|
153,984 |
|
152,607 |
|
153,396 |
|
150,224 |
|
||||
|
Diluted |
|
162,634 |
|
160,328 |
|
161,570 |
|
158,482 |
|
||||
These statements are presented for reference only. The final audited statements will include footnotes, which should be referenced when available, to more fully understand the contents of these statements.
DANAHER CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
|
|
|
As of December 31, |
|
||||
|
|
|
2003 |
|
2002 |
|
||
|
ASSETS |
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
||
Cash and equivalents |
|
$ |
1,230,156 |
|
$ |
810,463 |
|
|
Trade accounts receivable, less allowance for doubtful accounts |
|
868,097 |
|
759,028 |
|
||
|
Inventories |
|
536,227 |
|
485,587 |
|
||
|
Prepaid expenses and other |
|
307,671 |
|
332,188 |
|
||
|
Total current assets |
|
2,942,151 |
|
2,387,266 |
|
||
|
Property, plant and equipment, net |
|
573,365 |
|
597,379 |
|
||
|
Other assets |
|
32,562 |
|
36,796 |
|
||
|
Goodwill and other intangible assets |
|
3,064,109 |
|
2,776,774 |
|
||
|
Other intangible assets, net |
|
277,863 |
|
230,930 |
|
||
|
|
|
|
|
|
|
||
|
|
|
$ |
6,890,050 |
|
$ |
6,029,145 |
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
Current liabilities: |
|
|
|
|
|
||
|
Notes payable and current portion of long-term debt |
|
$ |
14,385 |
|
$ |
112,542 |
|
|
Trade accounts payable |
|
472,994 |
|
366,587 |
|
||
|
Accrued expenses |
|
892,624 |
|
786,183 |
|
||
|
Total current liabilities |
|
1,380,003 |
|
1,265,312 |
|
||
|
Other liabilities |
|
578,840 |
|
556,812 |
|
||
|
Long-term debt |
|
1,284,498 |
|
1,197,422 |
|
||
|
Stockholders’ equity: |
|
|
|
|
|
||
|
Common stock, one cent par value; 500,000 shares authorized; 167,694 and 166,545 issued; 153,681 and 152,532 outstanding |
|
1,677 |
|
1,665 |
|
||
|
Additional paid-in capital |
|
999,786 |
|
915,562 |
|
||
|
Accumulated other comprehensive income |
|
(74,607 |
) |
(105,973 |
) |
||
|
Retained earnings |
|
2,719,853 |
|
2,198,345 |
|
||
|
Total stockholders’ equity |
|
3,646,709 |
|
3,009,599 |
|
||
|
|
|
|
|
|
|
||
|
|
|
$ |
6,890,050 |
|
$ |
6,029,145 |
|
These statements are presented for reference only. The final audited statements will include footnotes, which should be referenced when available, to more fully understand the contents of these statements.
DANAHER CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
|
|
|
Year Ended |
|
||||
|
|
|
12/31/03 |
|
12/31/02 |
|
||
|
|
|
|
|
|
|
||
|
Cash flows from operating activities: |
|
|
|
|
|
||
|
Net earnings |
|
$ |
536,834 |
|
$ |
290,391 |
|
|
Reduction of income tax reserves |
|
— |
|
(30,000 |
) |
||
|
Effect of change in accounting principle |
|
— |
|
173,750 |
|
||
|
|
|
536,834 |
|
434,141 |
|
||
|
|
|
|
|
|
|
||
|
Depreciation and amortization |
|
133,436 |
|
129,565 |
|
||
|
Change in trade accounts receivable |
|
1,505 |
|
59,030 |
|
||
|
Change in inventories |
|
21,061 |
|
77,544 |
|
||
|
Change in accounts payable |
|
58,209 |
|
54,008 |
|
||
|
Change in accrued expenses and other liabilities |
|
72,097 |
|
27,595 |
|
||
|
Change in prepaid expenses and other assets |
|
38,402 |
|
(71,536 |
) |
||
|
Total operating cash flows |
|
861,544 |
|
710,347 |
|
||
|
|
|
|
|
|
|
||
|
Cash flows from investing activities: |
|
|
|
|
|
||
|
Payments for additions to property, plant and equipment |
|
(80,343 |
) |
(65,430 |
) |
||
|
Proceeds from disposals of property, plant and equipment |
|
12,926 |
|
26,466 |
|
||
|
Cash paid for acquisitions |
|
(312,283 |
) |
(1,158,129 |
) |
||
|
Proceeds from divestitures |
|
11,648 |
|
52,562 |
|
||
|
Net cash used in investing activities |
|
(368,052 |
) |
(1,144,531 |
) |
||
|
|
|
|
|
|
|
||
|
Cash flows from financing activities: |
|
|
|
|
|
||
|
Proceeds from issuance of common stock |
|
50,497 |
|
512,105 |
|
||
|
Dividends paid |
|
(15,326 |
) |
(13,516 |
) |
||
|
Proceeds from debt borrowings |
|
5,262 |
|
37,528 |
|
||
|
Debt repayments |
|
(150,771 |
) |
(19,820 |
) |
||
|
Purchase of treasury stock |
|
— |
|
— |
|
||
|
Net cash provided by financing activities |
|
(110,338 |
) |
516,297 |
|
||
|
|
|
|
|
|
|
||
|
Effect of exchange rate changes on cash |
|
36,539 |
|
21,791 |
|
||
|
Net change in cash and equivalents |
|
419,693 |
|
103,904 |
|
||
|
Beginning balance of cash and equivalents |
|
810,463 |
|
706,559 |
|
||
|
Ending balance of cash and equivalents |
|
$ |
1,230,156 |
|
$ |
810,463 |
|
These statements are presented for reference only. The final audited statements will include footnotes, which should be referenced when available, to more fully understand the contents of these statements.
DANAHER CORPORATION and SUBSIDIARIES
Segment Information
Year Ended December 31, 2003
(in thousands, unaudited)
|
|
|
1Q |
|
2Q |
|
3Q |
|
4Q |
|
Full |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Sales: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Process/Environmental Controls |
|
$ |
928,027 |
|
$ |
1,014,523 |
|
$ |
1,004,179 |
|
$ |
1,149,957 |
|
$ |
4,096,686 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Tools and Components |
|
268,188 |
|
284,909 |
|
305,272 |
|
338,821 |
|
1,197,190 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total |
|
$ |
1,196,215 |
|
$ |
1,299,432 |
|
$ |
1,309,451 |
|
$ |
1,488,778 |
|
$ |
5,293,876 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Operating Profit: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Process/Environmental Controls |
|
$ |
138,059 |
|
$ |
164,281 |
|
$ |
172,617 |
|
$ |
199,386 |
|
$ |
674,343 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Tools and Components |
|
34,639 |
|
43,663 |
|
48,502 |
|
47,017 |
|
173,821 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other |
|
(5,705 |
) |
(6,733 |
) |
(5,354 |
) |
(6,877 |
) |
(24,669 |
) |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Gain on Pension Plan Curtailment |
|
— |
|
— |
|
— |
|
22,500 |
|
22,500 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total |
|
$ |
166,993 |
|
$ |
201,211 |
|
$ |
215,765 |
|
$ |
262,026 |
|
$ |
845,995 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Operating Margins: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Process/Environmental Controls |
|
14.9 |
% |
16.2 |
% |
17.2 |
% |
17.3 |
% |
16.5 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Tools and Components |
|
12.9 |
% |
15.3 |
% |
15.9 |
% |
13.9 |
% |
14.5 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total |
|
14.0 |
% |
15.5 |
% |
16.5 |
% |
17.6 |
% |
16.0 |
% |
|||||
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.
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