10-KPeriod: FY2007

DANAHER CORP /DE/ Annual Report, Year Ended Dec 31, 2007

Filed February 21, 2008For Securities:DHR

Summary

Danaher Corporation's 2007 10-K filing reveals a year of significant growth, driven by strategic acquisitions and expansion across its four key segments: Professional Instrumentation, Medical Technologies, Industrial Technologies, and Tools & Components. The company reported a substantial increase in sales, bolstered by the integration of newly acquired businesses, most notably Tektronix, Inc. and ChemTreat, Inc. These acquisitions are expected to contribute to future growth and operational efficiencies. Danaher continues to leverage its Danaher Business System (DBS) to drive performance improvements in quality, delivery, cost, and innovation across its diverse portfolio. Financially, the company demonstrated robust operating cash flow generation. Despite significant investment in acquisitions, Danaher maintained a strong liquidity position. The company also continued its share repurchase program and paid dividends, reflecting a commitment to shareholder returns. Management highlighted ongoing efforts to improve operating profit margins through cost reduction initiatives and strategic sourcing. The company's global reach, with over half of its sales generated outside the U.S., provides diversification and resilience against regional economic fluctuations.

Financial Highlights

34 data points
Beta

Revenue

$11.03B

45.7% Gross Margin

Net Income

$1.37B

12.4% Net Margin

EPS (Diluted)

$2.10

Cash & Equivalents

$239.11M

Free Cash Flow

$1.48B

Financial Statements
Beta
Revenue$11.03B
Cost of Revenue$5.99B
Gross Profit$5.04B
R&D Expenses$601.42M
SG&A Expenses$2.71B
Operating Expenses$9.29B
Operating Income$1.74B
Interest Expense$109.70M
Net Income$1.37B
EPS (Basic)$2.20
EPS (Diluted)$2.10
Shares Outstanding (Basic)622.45M
Shares Outstanding (Diluted)658.92M

Key Highlights

  • 1Danaher achieved significant sales growth in 2007, driven by strategic acquisitions like Tektronix and ChemTreat, complementing its existing businesses.
  • 2The company's operational efficiency is managed through the Danaher Business System (DBS), aimed at continuous improvement in quality, delivery, cost, and innovation.
  • 3Operating cash flow remained strong, supporting the company's aggressive acquisition strategy and capital allocation priorities.
  • 4Danaher continued to invest in research and development across its segments, particularly in Medical Technologies and Professional Instrumentation, to drive future product innovation.
  • 5Approximately 51% of Danaher's total sales were generated from international markets, showcasing its global diversification.
  • 6The company actively managed its capital structure, utilizing commercial paper and senior notes to finance acquisitions, while also engaging in share repurchases and dividend payments.

Frequently Asked Questions

Danaher's growth in 2007 was primarily driven by strategic acquisitions, most notably Tektronix, Inc. and ChemTreat, Inc., which expanded its presence in the Professional Instrumentation and Medical Technologies segments. Organic growth from existing businesses, supported by new product introductions and market penetration, also contributed to the overall sales increase.

The company financed its major acquisitions in 2007 through a combination of sources, including proceeds from the issuance of commercial paper, proceeds from a common stock offering, and existing cash balances. For instance, the Tektronix acquisition was partly funded by commercial paper and a November 2007 stock offering, with a portion of the commercial paper subsequently refinanced through a senior notes offering.

Danaher aims to create shareholder value through multiple avenues. This includes delivering sales growth, achieving upper quartile financial performance, and generating strong cash flow. The company actively repurchases its own stock under an authorized program and has been paying regular dividends, indicating a commitment to returning capital to shareholders.

Danaher operates through four distinct segments: Professional Instrumentation, Medical Technologies, Industrial Technologies, and Tools & Components, offering a broad product portfolio. Geographically, the company is well-diversified, with approximately 51% of its sales generated outside the United States in 2007, primarily in Europe and Asia, which helps mitigate risks associated with any single market.