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Thermo Fisher Scientific Annual Report, Year Ended Dec 30, 2000

Filing Date
Filed March 21, 2001
Period End
December 30, 2000
Security
TMO
In the record · 2016–202610-K1110-Q338-K153

TMO filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 153 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Aug ’17Aug ’17
  2. Material agreement8-K · Oct ’19Oct ’19
  3. Leadership change8-K · Feb ’22Feb ’22
  4. Leadership change8-K · Jan ’26Jan ’26

01—Abstract

Summary

Summary of the 10-K filed March 21, 2001. Cited figures are marked; the original filing is the authoritative source.

Thermo Electron Corporation's fiscal 2000 10-K (fiscal year ended December 30, 2000) describes a company in the middle of a major portfolio reorganization.

Reported 2000 revenues from continuing operations were $2.28 billiona, roughly flat versus $2.29 billion in 1999, but up about 7% excluding acquisitions, divestitures and currency effects. Operating income rose to $266.0 million from $182.1 million, helped largely by roughly $126 million of gains on business sales, while net income was a loss of $36.1 million ($0.22 per share) after a $100 million after-tax charge for loss on disposal of discontinued operations and a $12.9 million cumulative accounting change from SAB No. 101 adoption. Income from continuing operations was $62.0 million, or $0.36 per diluted share, against $37.3 million a year earlier.

Management's strategy is to refocus on three segments, Life Sciences, Optical Technologies and Measurement and Control, by selling noncore businesses with more than $1 billionb of aggregate revenue and spinning off Thermo Fibertek and a medical products company. The power generation business was agreed for sale in February 2001, and Thermo Cardiosystems was sold to Thoratec for about 19.3 million Thoratec shares, whose market value will drive the ultimate disposal proceeds. The balance sheet remains substantial, with $1.03 billion in cash and short-term investments, $1.53 billion of long-term obligations, and shareholders' investment of $2.53 billion.

Investors should weigh the value of the discontinued operations and the Thoratec stake, the goodwill of about $1.4 billionc, and a cyclical Optical Technologies segment that management expects to slow in 2001. The filing also flags that the company has chosen to delay the spinoffs until the second half of 2001 because of weak financial markets, and that the spinoffs carry execution risk around the companies' liquidity and management. Results are sensitive to currency translation, which reduced 2000 revenues by $80 million, and to ongoing patent litigation involving Finnigan, though management does not expect these matters to be material to financial position.

02—Key points

Key Highlights

  1. Continuing-operations revenue of $2.28 billion, essentially flat year over year, but up about 7% excluding acquisitions, divestitures and currency effects.
  2. Net loss of $36.1 million ($0.22 per share), driven by a $100 million after-tax loss on disposal of discontinued operations and a $12.9 million SAB No. 101 cumulative effect charge.
  3. Income from continuing operations improved to $62.0 million ($0.36 diluted EPS) from $37.3 million, aided by about $126 million of gains on business sales.
  4. Strategic reorganization: sale of power generation business agreed in February 2001, Thermo Cardiosystems sold to Thoratec, and planned spinoffs of Thermo Fibertek and a medical products company now delayed to the second half of 2001.
  5. Strong liquidity with $1.03 billion of cash and short-term investments and working capital of $1.74 billion, against $1.53 billion of long-term obligations.
  6. Optical Technologies backlog rose to $253 million from $134 million, but management expects that segment's 2001 growth to be lower than in 2000 as semiconductor and telecom demand slows.
  7. Discontinued-operations proceeds are exposed to the market value of 19.3 million Thoratec shares, which carry transfer restrictions until August 2002.

03—Questions

Frequently Asked Questions

  1. Why did Thermo Electron report a net loss even though continuing operations were profitable?

    The net loss of $36.1 million reflects a $100 million after-tax provision for loss on disposal of discontinued operations, mainly because lower-than-expected after-tax sale proceeds were realized as financial markets weakened in late 2000, and a $12.9 million cumulative effect charge from adopting SAB No. 101 on revenue recognition. Continuing operations earned $62.0 million before those items.

  2. How much of 2000's operating income came from one-time items?

    Operating income was $266.0 million, but it was boosted by about $126.3 million of gains on business sales, largely from Spectra Precision, and by restructuring charges of $81.4 million. Excluding unusual items, segment income decreased to $252.5 million from $260.2 million in 1999.

  3. What is the company's exposure to the Thoratec stake?

    The company received about 19.3 million Thoratec shares in exchange for Thermo Cardiosystems. The ultimate proceeds from discontinued operations will move with Thoratec's share price, and the company has noted that restrictions on selling these shares lapse in August 2002.

  4. Is the planned spinoff still on track?

    The company has delayed the spinoffs of Thermo Fibertek and the healthcare products business until the second half of 2001 because of weak financial markets. An IRS ruling was received in February 2001, requiring the spinoffs within one year, and the spun-off businesses will need to raise public equity capital within a year of their spinoffs. Thermo Electron will also remain guarantor of $153 million of Thermo Fibertek debentures after the spinoff.

04—Continue

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