How did Danaher's revenue perform in the first quarter of 2008 compared to the prior year?

Danaher reported a 20% increase in total sales for the first quarter of 2008, reaching $3.03 billion, up from $2.52 billion in the same period of 2007. This growth was driven by a combination of existing business performance (2% growth), contributions from acquisitions (13% growth), and a favorable impact from currency translation (5% growth).

What was the impact of the Tektronix acquisition on Danaher's financial results?

The acquisition of Tektronix, completed in November 2007, significantly contributed to the reported sales growth, particularly within the Professional Instrumentation segment. However, it also led to acquisition-related charges, including acquired inventory and deferred revenue fair value adjustments totaling $26 million, which negatively impacted operating profit margins by 90 basis points in the first quarter of 2008. Similar charges are expected to affect margins through the remainder of 2008, though at lower levels.

How did Danaher's cash flow generation fare during the quarter?

Danaher demonstrated strong liquidity, with operating cash flow from continuing operations increasing by 3% to $333 million in the first quarter of 2008, compared to $322.6 million in the prior year. This increase was driven by earnings growth, partially offset by working capital changes.

What is Danaher's strategy for growth, and how are acquisitions fitting into it?

Danaher's strategy focuses on delivering sales growth exceeding market growth, achieving upper quartile financial performance, and generating strong cash flow, all underpinned by the Danaher Business System (DBS). Acquisitions are a key component of this strategy, with the company actively acquiring businesses that offer strategic fits or establish new growth lines. During the first quarter of 2008, Danaher acquired four companies for approximately $63 million to complement its Medical Technologies and Industrial Technologies segments.

DHR 10-Q Quarterly Report Q1 FY2008 — Revenue, Net Income, EPS

Summary

Danaher Corporation (DHR) reported a solid first quarter for 2008, demonstrating revenue growth driven by both existing operations and strategic acquisitions. Total sales increased by approximately 20% year-over-year, with acquisitions contributing about 13% and existing businesses adding 2%, bolstered by a 5% positive impact from currency translation. The company successfully integrated new businesses, notably Tektronix, which is expected to contribute to future growth despite initial impacts on operating margins due to acquisition-related accounting adjustments. Financially, the company maintained a strong operational cash flow, increasing by 3% to $333 million. While investment activities showed a net outflow primarily due to acquisitions, the overall financial health remains robust. Danaher continues to focus on its Danaher Business System (DBS) to drive operational improvements and value creation for shareholders, navigating a competitive market environment and global economic trends with a diversified business portfolio.

Key Highlights

1Total sales for the first quarter of 2008 increased by 20% to $3.03 billion compared to $2.52 billion in the prior year period.
2Acquisitions contributed significantly to growth, accounting for approximately 13% of the 20% total sales increase, with the Tektronix acquisition being a major factor.
3Operating profit margin slightly decreased to 13.6% from 14.7% year-over-year, partly due to acquisition-related charges (inventory and deferred revenue fair value adjustments) totaling $26 million from the Tektronix acquisition.
4Net earnings from continuing operations were $276.5 million, or $0.83 per diluted share, compared to $251.6 million, or $0.77 per diluted share, in the first quarter of 2007.
5Operating cash flow from continuing operations increased by 3% to $333 million, demonstrating strong cash generation.
6The company made strategic acquisitions during the quarter, spending $63 million in cash for four companies in life sciences, dental technologies, and product identification markets.
7Danaher experienced growth in its Environmental, Test & Measurement, Acute Care Diagnostics, and Life Sciences businesses, while facing slower demand in OEM and consumer-oriented businesses, particularly in North America and Europe.

DANAHER CORP /DE/ Quarterly Report for Q1 Ended Mar 28, 2008

Summary

Key Highlights

Frequently Asked Questions