10-KPeriod: FY2008

THERMO FISHER SCIENTIFIC INC. Annual Report, Year Ended Dec 31, 2008

Filed February 27, 2009For Securities:TMO

Summary

Thermo Fisher Scientific Inc. (TMO) filed its 2008 annual report on Form 10-K on February 26, 2009, detailing its operations for the fiscal year ending December 30, 2008. The company, formed by the merger of Thermo Electron and Fisher Scientific in November 2006, operates globally as a leader in serving science, offering analytical instruments, equipment, reagents, consumables, software, and services. The report highlights the company's significant revenue growth driven by both organic demand and strategic acquisitions, alongside its operational structure divided into two primary segments: Analytical Technologies and Laboratory Products and Services. Despite a challenging global economic environment at the end of 2008, Thermo Fisher demonstrated resilience, with consolidated revenues increasing by 8% year-over-year. The company emphasizes its commitment to innovation and customer productivity through its diverse product portfolio and extensive sales and service network. Key financial metrics indicate solid performance, with notable increases in operating income and margins, supported by integration savings and productivity improvements. The report also touches upon the company's financial condition, including its debt levels and liquidity, and outlines its strategic priorities moving forward, including continued investment in R&D and potential future acquisitions.

Financial Highlights

54 data points
Beta

Revenue

$10.50B

49.5% Gross Margin

Net Income

$980.90M

9.3% Net Margin

EPS (Diluted)

$2.25

Total Assets

$21.09B

Cash & Equivalents

$1.28B

Free Cash Flow

$1.16B

Financial Statements
Beta
Revenue$10.50B
Cost of Revenue$5.30B
Gross Profit$5.20B
SG&A Expenses$2.69B
Operating Expenses$9.27B
Operating Income$1.23B
Interest Expense$151.50M
Net Income$980.90M
EPS (Basic)$2.34
EPS (Diluted)$2.25
Shares Outstanding (Basic)418.20M
Shares Outstanding (Diluted)434.70M

Key Highlights

  • 1Consolidated revenues reached $10.50 billion in 2008, an 8% increase from $9.75 billion in 2007, driven by increased demand and strategic acquisitions.
  • 2The company operates through two main segments: Analytical Technologies, which generated $4.47 billion in revenue, and Laboratory Products and Services, which generated $6.45 billion in revenue.
  • 3Operating income increased by 26% to $1.23 billion in 2008 from $974 million in 2007, with operating income margins improving from 10.0% to 11.7%.
  • 4Thermo Fisher demonstrated strong operational cash flow, generating $1.42 billion in 2008, underscoring its financial stability.
  • 5The company continued its share repurchase program, authorizing up to $500 million in stock repurchases in September 2008, with $414.7 million available at year-end.
  • 6Despite global economic uncertainties, the company maintained sufficient liquidity and borrowing capacity, believing it could meet cash requirements for at least the next 24 months.
  • 7Research and Development spending was $249 million in 2008, reflecting continued investment in innovation and new product development.

Frequently Asked Questions

In 2008, Thermo Fisher Scientific reported consolidated revenues of $10.50 billion, an increase of 8% from $9.75 billion in 2007. Operating income grew significantly by 26% to $1.23 billion, and the operating income margin improved from 10.0% to 11.7%. The company also generated strong cash flow from operations of $1.42 billion, demonstrating financial resilience amidst global economic challenges.

Thermo Fisher Scientific's business is organized into two principal reporting segments: Analytical Technologies and Laboratory Products and Services. The Analytical Technologies segment focuses on high-end analytical instruments and integrated workflow solutions, while the Laboratory Products and Services segment offers a comprehensive portfolio of laboratory equipment, chemicals, supplies, and services through various channels, including e-commerce and direct sales.

Thermo Fisher Scientific's strategy involves augmenting internal growth with complementary acquisitions and continuous investment in product development. In 2008, the company spent $249 million on R&D and completed several acquisitions, such as La-Pha-Pack and NanoDrop Technologies, to expand its product lines and services. This dual approach aims to maintain its leadership position and drive future growth.

While the company acknowledged the challenging global economic environment and recession, it reported that it did not experience a material adverse impact on its revenues or profitability in 2008. However, it cautioned that these conditions could lead to customers delaying or canceling orders in 2009. Despite this, the company maintained sufficient liquidity and confidence in its ability to meet future financial obligations.