01—Abstract
Summary
Summary of the 10-K filed February 23, 2022. Cited figures are marked; the original filing is the authoritative source.
Danaher Corporation (DHR) reported a strong financial performance for the fiscal year ended December 30, 2021, driven by significant growth across its key segments, particularly Life Sciences and Diagnostics.
The company achieved substantial revenue growth, aided by strategic acquisitions, including the significant acquisition of Aldevron. Danaher's robust financial position is underscored by increased operating profit margins and healthy cash flow from operations, demonstrating effective execution of its Danaher Business System (DBS) and strategic priorities. Despite potential headwinds from supply chain disruptions and global economic uncertainties, Danaher's diversified business model and focus on innovation in science and technology markets have allowed it to navigate these challenges effectively.
The company's commitment to attracting and retaining talent, coupled with ongoing investments in research and development, positions it for continued growth and value creation for shareholders. Investors can look forward to Danaher's continued focus on portfolio enhancement through strategic capital allocation and operational excellence.
02—Key points
Key Highlights
- Danaher reported strong overall sales growth of 32.0% for the year ended December 31, 2021, compared to the prior year.
- The Life Sciences segment saw a significant 41.5% increase in sales, driven by strong demand in bioprocessing and genomics, including contributions from the Cytiva and Aldevron acquisitions.
- The Diagnostics segment also experienced robust growth with a 33.0% increase in sales, primarily due to demand for molecular diagnostics and core lab products, including COVID-19 testing solutions.
- Operating profit margins improved significantly to 25.3% in 2021 from 19.0% in 2020, reflecting increased sales volumes and productivity improvements.
- The company acquired Aldevron for approximately $9.6 billion, expanding its Life Sciences segment's capabilities in genomic medicine.
- Danaher generated substantial operating cash flow from continuing operations of $8.4 billion in 2021, a 34% increase year-over-year.
- The company ended the year with a strong liquidity position, holding $2.6 billion in cash and cash equivalents.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2021, Danaher Corp kept $0.26.
- Revenue$24.80B100.0%
- Cost of revenue−$9.56B38.6%
- Gross profit$15.24B61.4%
- Operating costs−$8.86B35.7%
- Operating income$6.38B25.7%
- Interest, other & tax$56.0M0.2%
- Net income$6.43B25.9%
Where FY2021 revenue went
$24.80B- Cost of revenue: $9.56B, 39% of revenue
- SG&A: $6.82B, 27% of revenue
- Operating income: $6.38B, 26% of revenue
- R&D: $1.50B, 6.0% of revenue
- Other operating costs: $547.0M, 2.2% of revenue
Kept 26% as operating income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2021filed February 23, 2022Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $24.80B$22.28B | +11.3% |
| Cost of Revenue | $9.56B$9.81B | −2.5% |
| Gross Profit | $15.24B$12.47B | +22.2% |
| R&D Expenses | $1.50B$1.35B | +11.1% |
| SG&A Expenses | $6.82B$6.90B | −1.1% |
| Operating Income | $6.38B$4.23B | +50.7% |
| Interest Expense | $231.00M$275.00M | −16.0% |
| Net Income | $6.43B$3.65B | +76.4% |
| EPS (Basic) | $8.77$4.97 | +76.5% |
| EPS (Diluted) | $8.61$4.89 | +76.1% |
| Shares Outstanding (Basic) | 714.60M706.20M | +1.2% |
| Shares Outstanding (Diluted) | 736.80M718.70M | +2.5% |
05—Questions
Frequently Asked Questions
What were the main drivers of Danaher's revenue growth in 2021?
Danaher's revenue growth in 2021 was driven by a strong increase in 'core sales' across its Life Sciences and Diagnostics segments, fueled by demand related to COVID-19 vaccines, therapeutics, and testing, as well as broader market recovery. Strategic acquisitions, notably Aldevron, also significantly contributed to the overall sales increase.
How did the acquisition of Aldevron impact Danaher's financial performance?
The acquisition of Aldevron for approximately $9.6 billion in August 2021 significantly bolstered Danaher's Life Sciences segment. It expanded the company's product offerings in genomic medicine and contributed to the substantial year-over-year revenue growth reported for the segment.
What is Danaher's outlook regarding supply chain challenges?
Danaher acknowledged experiencing supply chain disruptions, including shortages and cost inflation, particularly in the latter half of 2021. While the company indicated that its Danaher Business System (DBS) tools largely mitigated these impacts in 2021, it noted that these pressures continued as of the filing date, and it is actively working with suppliers and qualifying additional sources to mitigate potential future adverse effects.
How did Danaher manage its debt and capital resources in 2021?
Danaher generated strong operating cash flow in 2021 and managed its debt levels. The company had approximately $22.2 billion in outstanding indebtedness at year-end. Financing activities included issuing commercial paper to fund acquisitions and general corporate purposes, as well as issuing debt securities. The company maintained a strong liquidity position with $2.6 billion in cash and cash equivalents.
06—Continue