SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE
[ X ] SECURITIES AND EXCHANGE ACT OF 1934
For the Quarter ended March 29, 1996
OR
[ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 1-8089
DANAHER CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 59-
1995548
(State of incorporation)
(I.R.S. Employer
Identification number)
1250 24th Street, N.W., Suite 800
Washington, D.C. 20037
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 202-828-
0850
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months and
(2) has been subject to such filing requirements for the past 90
days.
Yes X
No
The number of shares of common stock outstanding at April 17, 1996
was 58,140,968.<PAGE>
DANAHER CORPORATION
INDEX
FORM 10-Q
PART I - FINANCIAL INFORMATION
Page
Item 1. Financial Statements
Consolidated Condensed Balance Sheets
at March 29, 1996 and December 31, 1995
1
Consolidated Condensed Statements of
Earnings for the three months ended
March 29, 1996 and March 31, 1995
2
Consolidated Condensed Statements of
Cash Flow for the three months ended
March 29, 1996 and March 31, 1995
3
Notes to Consolidated Condensed
Financial Statements
4
Item 2. Management's Discussion and
Analysis of Financial Condition
and Results of Operations
5
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
6
(27) Financial Data Schedules
<PAGE>
DANAHER CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(000's omitted)
March
29, December 31,
1996
1995
(unaudited
) (NOTE 1)
ASSETS
Current Assets:
Cash and equivalents $ 15,867
$ 7,938
Accounts receivable, net 250,398
224,652
Inventories:
Finished goods
98,672 89,932
Work in process 47,415
51,904
Raw material and supplies 60,686
60,054
Total inventories 206,773
201,890
Prepaid expenses and other
current assets 36,981
31,990
Total current assets 510,019
466,470
Property, plant and equipment, net of
depreciation of $183,928 and $168,566,
respectively
293,438 291,937
Other assets
83,594 119,444
Excess of cost over net assets of
acquired companies, net
616,429 608,140
Total assets
$ 1,503,480 $1,485,991
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable and current
portion of long-term debt $ 50,065
$ 14,970
Accounts payable
96,757 92,290
Accrued expenses
347,931 296,878
Total current liabilities 494,753
404,138
Other liabilities 227,269
226,925
Long-term debt
101,680 268,617
Stockholders' equity:
Common stock - $.01 par value 634
634
Additional paid-in capital 315,931
315,205
Retained earnings
409,939 304,363
Cumulative foreign translation
adjustment
2,873 3,598
Treasury stock
(49,599) (37,489)
Total stockholders' equity 679,778
586,311
Total liabilities and
stockholders' equity
$1,503,480 $ 1,485,991
See notes to consolidated condensed financial statements.<PAGE>
DANAHER CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(000's omitted except per share amounts)
(unaudited)
Three
Months Ended
March
29, March 31,
1996
1995
Net sales $
409,557 $ 335,982
Cost of sales
285,264 239,275
Selling, general and
administrative expenses
72,872 56,532
Goodwill and other amortization
4,293 3,337
Total operating expenses
362,429 299,144
Operating profit
47,128 36,838
Interest expense, net
2,983 1,224
Earnings from continuing operations
before income taxes 44,145
35,614
Income taxes
17,217 14,202
Earnings from continuing operations
26,928 21,412
Earnings from discontinued operations,
net of income taxes of $-0- and $279
79,811 436
Net earnings $ 106,739$ 21,848
Per share:
Continuing operations $ .45 $
.36
Discontinued operations 1.34
.01
Net earnings $ 1.79 $ .37
Average common stock and common
equivalent shares outstanding 59,680,406
59,771,541
See notes to consolidated condensed financial statements.
<PAGE>
DANAHER CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOW
(000's omitted)
(unaudited)
Three Months
Ended
March
29, March 31,
1996
1995
Cash flows from operating activities:
Net earnings from operations $26,928 $21,848
Noncash items, depreciation and
amortization 16,818
17,341
Increase in accounts receivable (22,075)
(14,215)
Increase in inventories (785)
(23,262)
Increase in accounts payable
4,071 12,160
Change in other assets and liabilities
9,566 18,150
Total operating cash flows
34,523 32,022
Cash flows from investing activities:
Sale of Fayette Tubular Products 155,000 -
Payments for additions to property,
plant, and equipment, net (12,107)
(16,652)
Cash paid for acquisitions (25,073) -
Net cash provided by (used in)
investing activities 117,820
(16,652)
Cash flows from financing activities:
Acquisition of treasury stock (12,110) -
Proceeds from issuance of common stock 726 2,319
Dividends paid (1,163)
(1,168)
Repayment of debt (131,842)
(3,558)
Net cash used in financing activities (144,389)
(2,407)
Effect of exchange rate changes on cash (25) 808
Net change in cash and equivalents 7,929
13,771
Beginning balance of cash equivalents 7,938 1,978
Ending balance of cash equivalents $ 15,867 $15,749
Supplemental disclosures:
Cash interest payments $
1,551 $ 309
Cash income tax payments $
16,180 $ 8,157
See notes to consolidated condensed financial statements.
<PAGE>
DANAHER CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
March 29, 1996
(unaudited)
NOTE 1. GENERAL
The consolidated condensed financial statements included
herein have been prepared by Danaher Corporation (the Company)
without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and
regulations; however, the Company believes that the disclosures are
adequate to make the information presented not misleading. The
condensed financial statements included herein should be read in
conjunction with the financial statements and the notes thereto
included in the Company's 1995 Annual Report on Form 10-K.
In the opinion of the registrant, the accompanying financial
statements contain all adjustments (consisting of only normal
recurring accruals) necessary to present fairly the financial
position of the Company at March 29, 1996 and December 31, 1995, its
results of operations for the three months ended March 29, 1996 and
March 31, 1995, and its cash flows for the three months ended March
29, 1996 and March 31, 1995.
NOTE 2. ACQUISITION OF JOSLYN CORPORATION
The Company obtained control of Joslyn Corporation (Joslyn) as
of September 1, 1995 when Joslyn's shareholders tendered
approximately 75% of the outstanding shares to Danaher for $34 per
share in cash. The remaining 25% was acquired on October 31, 1995.
Total consideration for Joslyn was approximately $245 million. The
fair value of assets acquired was approximately $345 million and
approximately $100 million of liabilities was assumed. The
transaction is being accounted for as a purchase. The purchase
price allocations have been completed on a preliminary basis,
subject to adjustment should new or additional facts about the
business become known.
The unaudited pro forma information for the period set forth
below gives effect to the transaction as if it had occurred at the
beginning of each period. The pro forma information is presented
for informational purposes only and is not necessarily indicative of
the results of operations that actually would have been achieved had
the acquisition been consummated as of that time. Amounts for 1994
include Joslyn's $35 million ($21 million after tax benefit or $0.36
per share) provision for environmental remediation associated with
sites previously owned by Joslyn (unaudited, 000's omitted):
Year Ended Year Ended Quarter Ended
December 31, December 31,
March 31,
1994 1995 1995
Net Sales $ 1,330,150 $1,640,554 $
392,505
Net Earnings 59,696 109,919
20,106
Earnings per
Share $1.02 $1.84 $ .34
NOTE 3. DISCONTINUED OPERATIONS
In January, 1996, the Company sold its Fayette Tubular
Products (Fayette) subsidiary for $155 million in cash. A gain of
$79.8 million was recognized in the first quarter of 1996. As the
Company no longer operates in the Transportation business segment,
amounts for 1995 have been restated to reflect Fayette as a
discontinued operation.
NOTE 4. TENDER OFFER FOR ACME-CLEVELAND CORPORATION
On March 7, 1996, the Company proposed to acquire all
outstanding shares of Acme-Cleveland Corporation (NYSE:AMT) for
approximately $180 million in a merger transaction whereby Acme-
Cleveland shareholders would receive $27 per share in cash. If the
merger is completed, which remains uncertain as of the date of this
quarterly report, the Acme-Cleveland businesses would be an addition
to the Company's Process/Environmental Controls business segment.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations
Net Sales for the first quarter of 1996 of $409.6 million were
22% higher than the 1995 quarter. Sales were higher in both
business segments. Of this increase, acquisitions accounted for
approximately 19% and companies included in both periods accounted
for 3%. Increases in the volume of shipments in all business
segments provided this growth.
Gross profit margin for the first quarter of 1996, as a
percentage of sales, was 30.3% which represents a 1.6 percentage
point increase from 1995 levels. This results both from the effect
of the acquired companies which provide a higher gross margin and
productivity improvements within the existing business units.
Selling, general and administrative expenses for the 1996
first quarter were 29% higher than in 1995 because of higher sales
levels. As a percentage of sales, these costs increased to 17.8%
from 16.8% in 1995, as a result of the acquired businesses which
have a higher overall selling expense structure than the existing
business units.
Interest expense of $2,983,000 in 1996 was higher than the
corresponding 1995 period. Total debt levels were higher in 1996,
reflecting the acquisitions made in 1995.
The 1996 effective tax rate of 39.0% is lower than the 1995
effective rate, reflecting the lesser impact of nondeductible
goodwill amortization given higher pretax earnings and a lower
income tax expense for certain foreign operations.
Liquidity and Capital Resources
During the first quarter of 1996, the Company experienced
increases in accounts receivable, inventory, and accounts payable.
This is principally due to the lower activity levels experienced in
the last weeks of the 1995 year due to the holiday season. Total
debt under the Company's borrowing facilities decreased to $151.7
million at March 29, 1996, compared to $283.6 million at December
31, 1995, due to the proceeds from the sale of Fayette along with
earnings for the quarter offset somewhat by the seasonal working
capital increase discussed above.
The Company declared a regular quarterly dividend of
$.02 per share payable on April 26, 1996, to holders of record on
March 22, 1996.
The Company's cash provided from operations, as well as
credit facilities available, should provide sufficient available
funds to meet normal working capital requirements, capital
expenditures, dividends, scheduled debt repayments, and to fund the
Acme-Cleveland acquisition, if applicable.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits: (27) Financial Data Schedules
(b) Reports on Form 8-K: None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
DANAHER CORPORATION:
Date: April 18, 1996 By: /s/ Patrick W.
Allender
Patrick W.
Allender
Chief
Financial Officer
Date: April 18, 1996 By: /s/ C. Scott Brannan
C. Scott
Brannan
Controller
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0
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