WASHINGTON, April 20, 2017 /PRNewswire/ -- Danaher Corporation (NYSE: DHR) today announced results for the first quarter of 2017. All results in this release reflect only continuing operations unless otherwise noted. For the quarter ended March 31, 2017, net earnings were $483.8 million, or $0.69 per diluted share which represents an 18.0% year-over-year decrease.
Non-GAAP adjusted diluted net earnings per share was $0.85 per share. This represents an 8.0% increase over the comparable 2016 period. For the first quarter 2017, revenues increased 7.0% year-over-year to $4.2 billion, with core revenue growth of 2.5% (non-GAAP).
For the second quarter of 2017, the Company anticipates that diluted net earnings per share will be in the range of $0.77 to $0.80 and non-GAAP adjusted diluted net earnings per share will be in the range of $0.95 to $0.98.
For the full year 2017, the Company anticipates that diluted net earnings per share will be in the range of $3.13 to $3.23, and continues to expect its non-GAAP adjusted diluted net earnings per share to be in the range of $3.85 to $3.95.
Thomas P. Joyce, Jr., President and Chief Executive Officer, stated, "We are off to a good start in 2017. During the first quarter, our two most recent large acquisitions, Pall and Cepheid, performed very well. We drove share gains in a number of our operating companies and achieved high-single-digit adjusted earnings per share growth. We also continued to reinvest in our businesses to enhance our long-term growth trajectory, and we feel well-positioned to benefit from a number of compelling market drivers across the portfolio."
Joyce continued, "Through focused execution across the portfolio, and with the Danaher Business System continuing to serve as our foundation, we see tremendous opportunities to deliver long-term value creation for shareholders."
Danaher will discuss its results during its quarterly investor conference call today starting at 8:00 a.m. ET. The call and an accompanying slide presentation will be webcast on the "Investors" section of Danaher's website, www.danaher.com, under the subheading "Events & Presentations." A replay of the webcast will be available in the same section of Danaher's website shortly after the conclusion of the presentation and will remain available until the next quarterly earnings call.
The conference call can be accessed by dialing 877-675-4753 within the U.S. or by dialing +1-719-325-4806 outside the U.S. a few minutes before the 8:00 a.m. ET start and telling the operator that you are dialing in for Danaher's investor conference call (access code 7663249). A replay of the conference call will be available shortly after the conclusion of the call and until Thursday, April 27, 2017. You can access the replay dial-in information on the "Investors" section of Danaher's website under the subheading "Events & Presentations." In addition, presentation materials relating to Danaher's results have been posted to the "Investors" section of Danaher's website under the subheading "Financial Reports & Earnings."
ABOUT DANAHERDanaher is a global science and technology innovator committed to helping its customers solve complex challenges and improving quality of life around the world. Its family of world class brands has leadership positions in some of the most demanding and attractive industries, including health care, environmental and industrial. With more than 20 operating companies, Danaher's globally diverse team of over 62,000 associates is united by a common culture and operating system, the Danaher Business System. For more information, please visit www.danaher.com.
NON-GAAP MEASURESIn addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), this earnings release also contains non-GAAP financial measures. Calculations of these measures, the reasons why we believe these measures provide useful information to investors, a reconciliation of these measures to the most directly comparable GAAP measures and other information relating to these non-GAAP measures are included in the supplemental reconciliation schedule attached.
FORWARD-LOOKING STATEMENTSStatements in this release that are not strictly historical, including the statements regarding the Company's anticipated financial performance for the second quarter and full year 2017, the Company's positioning to take advantage of market growth opportunities, the Company's opportunities to deliver long-term value creation and any other statements regarding events or developments that we believe or anticipate will or may occur in the future are "forward-looking" statements within the meaning of the federal securities laws. There are a number of important factors that could cause actual results, developments and business decisions to differ materially from those suggested or indicated by such forward-looking statements and you should not place undue reliance on any such forward-looking statements. These factors include, among other things, deterioration of or instability in the economy, the markets we serve and the financial markets, contractions or growth rates and cyclicality of markets we serve, competition, our ability to develop and successfully market new products and technologies and expand into new markets, the potential for improper conduct by our employees, agents or business partners, our compliance with applicable laws and regulations (including regulations relating to medical devices and the health care industry), our ability to effectively address cost reductions and other changes in the health care industry, our ability to successfully identify, consummate and integrate appropriate acquisitions and successfully complete divestitures and other dispositions, our ability to integrate the recent acquisitions of Pall Corporation and Cepheid and achieve the anticipated benefits of such transactions, contingent liabilities relating to acquisitions and divestitures (including tax-related and other contingent liabilities relating to the distributions of each of Fortive Corporation and our communications business), security breaches or other disruptions of our information technology systems or violations of data privacy laws, the impact of our restructuring activities on our ability to grow, risks relating to potential impairment of goodwill and other intangible assets, currency exchange rates, tax audits and changes in our tax rate and income tax liabilities, changes in tax laws applicable to multinational companies, litigation and other contingent liabilities including intellectual property and environmental, health and safety matters, the rights of the United States government to use, disclose and license certain intellectual property we license if we fail to commercialize it, risks relating to product, service or software defects, product liability and recalls, risks relating to product manufacturing, the impact of our debt obligations on our operations and liquidity, our relationships with and the performance of our channel partners, uncertainties relating to collaboration arrangements with third parties, commodity costs and surcharges, our ability to adjust purchases and manufacturing capacity to reflect market conditions, reliance on sole sources of supply, the impact of deregulation on demand for our products and services, labor matters, international economic, political, legal, compliance and business factors (including the impact of the UK's decision to leave the EU), disruptions relating to man-made and natural disasters, and pension plan costs. Additional information regarding the factors that may cause actual results to differ materially from these forward-looking statements is available in our SEC filings, including our 2016 Annual Report on Form 10-K and Quarterly Report on Form 10-Q for the first quarter of 2017. These forward-looking statements speak only as of the date of this release and except to the extent required by applicable law, the Company does not assume any obligation to update or revise any forward-looking statement, whether as a result of new information, future events and developments or otherwise.
DANAHER CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
($ and shares in millions, except per share amounts)
Three-Month Period Ended
March 31, 2017
April 1, 2016
Cost of sales
Selling, general and administrative expenses
Research and development expenses
Nonoperating income (expense):
Earnings from continuing operations before income taxes
Net earnings from continuing operations
Earnings from discontinued operations, net of income taxes
Net earnings per share from continuing operations:
Net earnings per share from discontinued operations:
Net earnings per share:
Average common stock and common equivalent shares outstanding:
This information is presented for reference only. A complete copy of Danaher's Form 10-Q financial statements is available on the Company's website (www.danaher.com).
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
Adjusted Diluted Net Earnings Per Share from Continuing Operations
Diluted Net Earnings Per Share from Continuing Operations (GAAP)
Pretax gain on sale of investments A
Pretax amortization of acquisition-related intangible assets B
Tax effect of all adjustments reflected above C
Discrete and other tax-related adjustments D
Adjusted Diluted Net Earnings Per Share from Continuing Operations (Non-GAAP)
Forecasted Adjusted Diluted Net Earnings Per Share from Continuing Operations
Three-Month Period Ending June 30, 2017
December 31, 2017
Forecasted Diluted Net Earnings Per Share from Continuing Operations (GAAP) 1
Anticipated pretax amortization of acquisition-related intangible assets B
Forecasted Adjusted Diluted Net Earnings Per Share from Continuing Operations (Non-GAAP) 1
The forward-looking estimates set forth above do not reflect future gains and charges that are inherently difficult to predict and estimate due to their unknown timing, effect and/or significance, such as certain future gains or losses on the sale of investments, acquisition or divestiture-related gains or charges and other discrete tax items (including excess tax benefits that exceed or fall below anticipated levels).
Core Revenue Growth
Three-Month Period Ended March 31,2017 vs.Comparable 2016 Period
Total Revenue Growth from Continuing Operations (GAAP)
Components of Revenue Growth
Core (non-GAAP) 2
Impact of currency translation (non-GAAP)
We use the term "core revenue" to refer to GAAP revenue from continuing operations excluding (1) sales from acquired businesses recorded prior to the first anniversary of the acquisition less the amount of sales attributable to divested businesses or product lines not considered discontinued operations ("acquisition sales") and (2) the impact of currency translation. The portion of GAAP revenue from continuing operations attributable to currency translation is calculated as the difference between (a) the period-to-period change in revenue (excluding acquisition sales) and (b) the period-to-period change in revenue (excluding acquisition sales) after applying current period foreign exchange rates to the prior year period. We use the term "core revenue growth" to refer to the measure of comparing current period core revenue with the corresponding period of the prior year.
Gain on sale of investments in the three-month period ended April 1, 2016 ($223 million pretax as presented in this line item, $140 million after-tax).
Amortization of acquisition-related intangible assets in the following historical and forecasted periods ($ in millions) (only the pretax amounts set forth below are reflected in the amortization line item above):
Three-Month Period Ending
June 30, 2017
This line item reflects the aggregate tax effect of all nontax adjustments reflected in the table above. In addition, the footnotes above indicate the after-tax amount of each individual adjustment item. Danaher estimates the tax effect of the adjustment items identified in the reconciliation schedule above by applying Danaher's overall estimated effective tax rate to the pretax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment.
Represents discrete income tax gains, primarily related to equity compensation related excess tax benefits. On January 1, 2017, Danaher adopted the updated accounting guidance required by ASU 2016-09, Compensation—Stock Compensation, which requires income statement recognition of all excess tax benefits and deficiencies related to equity compensation. We exclude from Adjusted Diluted Net EPS any excess tax benefits that exceed the levels we believe are representative of historical experience. In the first quarter of 2017, we anticipated $10 million of equity compensation related excess tax benefits and realized $26 million of excess tax benefits, and therefore we have excluded $16 million of these benefits in the calculation of Adjusted Diluted Net EPS. For the year ending December 31, 2017, excluding this first quarter 2017 $16 million benefit, we anticipate $40 million of equity compensation-related excess tax benefits which are reflected in Forecasted Adjusted Diluted Net Earnings per Share.
Statement Regarding Non-GAAP MeasuresEach of the non-GAAP measures set forth above should be considered in addition to, and not as a replacement for or superior to, the comparable GAAP measure, and may not be comparable to similarly titled measures reported by other companies. Management believes that these measures provide useful information to investors by offering additional ways of viewing Danaher Corporation's ("Danaher" or the "Company") results that, when reconciled to the corresponding GAAP measure, help our investors to:
Management uses these non-GAAP measures to measure the Company's operating and financial performance, and uses a non-GAAP measure similar to Adjusted Diluted Net EPS in the Company's executive compensation program.
The items excluded from the non-GAAP measures set forth above have been excluded for the following reasons:
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SOURCE Danaher Corporation
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