FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
(Mark One)
(X)Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30, 1999
OR
( )Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from __________ to __________
Commission File Number 001-10109
BECKMAN COULTER, INC.
(Exact name of registrant as specified in its charter)
Delaware 95-104-0600
(State of Incorporation) (I.R.S. Employer
Identification No.)
4300 N. Harbor Boulevard, Fullerton, California 92834-3100
(Address of principal executive offices) (Zip Code)
(714) 871-4848
(Registrant's telephone number including area code)
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 (or for such shorter period
that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Yes (X) No ( ).
APPLICABLE ONLY TO CORPORATE ISSUERS:
Outstanding shares of common stock, $0.10 par value, as of
July 26, 1999: 28,711,122 shares.
<PAGE>
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Statements of Operations for the
three and six month periods ended June 30, 1999 and 1998
Condensed Consolidated Balance Sheets as of June 30, 1999
and December 31, 1998
Condensed Consolidated Statements of Cash Flows for the
six month periods ended June 30, 1999 and 1998
Notes to Condensed Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
<PAGE>
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes In Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security-Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
<PAGE>
PART I
FINANCIAL INFORMATION
BECKMAN COULTER, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Millions, Except Amounts Per Share)
Unaudited
<TABLE>
<CAPTION>
Three Months Six Months
Ended Ended
June 30, June 30,
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales $446.2 $434.7 $851.3 $834.1
Cost of sales 234.1 236.5 445.4 466.3
------ ------ ------ ------
Gross profit 212.1 198.2 405.9 367.8
Operating costs and
expenses:
Selling, general and
administrative 115.5 123.6 227.3 243.3
Research and development 42.5 42.2 81.2 83.8
------ ------ ------ ------
Total operating cost and
expenses 158.0 165.8 308.5 327.1
------ ----- ------ ------
Operating income 54.1 32.4 97.4 40.7
Nonoperating (income)and
expense:
Interest income (1.8) (4.0) (3.8) (7.1)
Interest expense 18.9 22.9 37.1 49.1
Other, net (1.1) (0.5) 1.0 (2.9)
------ ------ ------ ------
Total nonoperating
(income) and expense 16.0 18.4 34.3 39.1
------ ------ ------ ------
Earnings before income taxes 38.1 14.0 63.1 1.6
Income taxes 12.2 4.5 20.2 0.5
------ ------ ------ ------
Net earnings $ 25.9 $ 9.5 $ 42.9 $ 1.1
====== ====== ====== ======
Basic earnings per share $ 0.91 $0.34 $ 1.51 $ 0.04
Weighted average number of
shares outstanding (in 28,584 27,892 28,525 27,801
thousands)
Diluted earnings per share $ 0.87 $ 0.32 $ 1.45 $ 0.04
Weighted average number of
shares and dilutive shares
outstanding (in thousands) 29,611 29,395 29,588 29,126
Dividends declared per share $ 0.16 $ 0.15 $ 0.32 $ 0.30
</TABLE>
See accompanying Notes to Condensed Consolidated Financial Statements.
<PAGE>
BECKMAN COULTER, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in Millions, Except Amounts per Share)
Unaudited
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
---- ----
<S> <C> <C>
Assets
Current assets:
Cash and equivalents $ 13.0 $ 24.7
Trade and other receivables 532.8 540.2
Inventories 318.2 302.8
Deferred income taxes 54.7 60.5
Other current assets 32.2 28.4
-------- --------
Total current assets 950.9 956.6
Property, plant and equipment, net 304.3 309.4
Intangibles, less accumulated amortization
of $37.3 in 1999 and $27.6 in 1998 409.4 419.1
Goodwill, less accumulated amortization of
$19.6 in 1999 and $14.9 in 1998 351.1 356.1
Other assets 94.3 92.1
-------- --------
Total assets $2,110.0 $2,133.3
======== ========
Liabilities and Stockholders' Equity
Current liabilities:
Notes payable and current maturities
of long-term debt $ 109.1 $ 135.1
Accounts payable, accrued expenses and
other liabilities 448.3 523.0
Income taxes 72.4 61.2
-------- --------
Total current liabilities 629.8 719.3
Long-term debt, less current maturities 995.4 982.2
Other liabilities 324.0 304.9
-------- --------
Total liabilities 1,949.2 2,006.4
Stockholders' equity:
Preferred stock, $0.10 par value;
authorized 10.0 shares;
none issue - -
Common stock, $0.10 par value; authorized
75.0 shares; shares issued 29.1 at 1999
and 1998; shares outstanding 28.7 at
1999 and 28.4 at 1998 2.9 2.9
Additional paid-in capital 134.0 131.9
Retained earnings 69.2 35.4
Accumulated other comprehensive loss:
Cumulative foreign currency translation
adjustment (25.9) (13.9)
Treasury stock, at cost (19.4) (29.4)
-------- --------
Total stockholders' equity 160.8 126.9
-------- --------
Total liabilities and stockholders' $2,110.0 $2,133.3
equity ======== ========
</TABLE>
See accompanying Notes to Condensed Consolidated Financial Statements.
<PAGE>
BECKMAN COULTER, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Millions)
Unaudited
<TABLE>
<CAPTION>
Six Months Ended
June 30,
1999 1998
---- ----
<S> <C> <C>
Cash Flows from Operating Activities
Net earnings $ 42.9 $ 1.1
Adjustments to reconcile net earnings to
net cash provided (used) by operating
activities:
Depreciation and amortization 74.5 68.1
Net deferred income taxes (0.3) (5.8)
Proceeds from sale of sales-type lease
receivables 27.6 36.8
Changes in assets and liabilities:
Trade and other receivables (14.6) 25.3
Inventories (16.9) (5.2)
Accounts payable, accrued expenses and
other liabilities (62.0) (171.5)
Accrued restructuring costs (11.2) (5.0)
Income taxes payable 11.4 (8.8)
Other 9.0 (27.2)
------ ------
Net cash provided (used) by operating 60.4 (92.2)
activities ------ ------
Cash Flows from Investing Activities
Additions to property, plant and equipment (66.2) (82.6)
Net disposals of property, plant and 2.7 44.0
equipment
Sale of investments - 3.6
Proceeds from sale-leaseback of real estate - 242.8
------ ------
Net cash (used) provided by investing (63.5) 207.8
activities ------ ------
Cash Flows from Financing Activities
Dividends to stockholders (9.1) (8.3)
Proceeds from issuance of stock 12.4 7.5
Notes payable reductions (24.7) (0.6)
Long-term debt borrowings 21.0 418.2
Long-term debt reductions (8.1) (535.8)
------ ------
Net cash used by financing activities (8.5) (119.0)
------ ------
Effect of exchange rates on cash and (0.1) 0.9
equivalents ------ ------
Decrease in cash and equivalents (11.7) (2.5)
Cash and equivalents - beginning of period 24.7 33.5
------ ------
Cash and equivalents - end of period $ 13.0 $ 31.0
====== ======
Supplemental Disclosures of Cash Flow
Information
Cash paid during the period for:
Interest $ 36.6 $ 50.7
Income taxes $ 9.6 $ 9.4
Non-cash investing and financing activities:
Purchase of equipment under capital lease $ 0.6 $ 4.0
</TABLE>
See accompanying Notes to Condensed Consolidated Financial Statements.
<PAGE>
BECKMAN COULTER, INC.
Notes To Condensed Consolidated Financial Statements
June 30, 1999
Unaudited
1. Report by Management
We prepared the accompanying Condensed Consolidated Financial
Statements following the requirements of the Securities and
Exchange Commission (SEC) for interim reporting. As permitted
under those rules, certain footnotes or other financial
information normally required by generally accepted
accounting principles (GAAP) have been condensed or omitted. In
addition, we have reclassified certain prior year data to conform
to the 1999 presentation.
The financial statements include all normal and recurring
adjustments that we consider necessary for the fair presentation
of our financial position and operating results. To obtain a
more detailed understanding of our results, these Condensed
Consolidated Financial Statements should be read in conjunction
with the consolidated financial statements and notes in our
annual report on Form 10-K for the year ended December 31, 1998.
Revenues, expenses, assets, and liabilities can vary between the
quarters of the year. Therefore, the results and trends
in these interim financial statements may not be the same as
those for the full year.
2. Use of Estimates
In preparing the financial statements in accordance with GAAP, we
have made estimates and assumptions that affect the following:
- - reported amounts of assets and liabilities at the date of
the financial statements;
- - disclosure of contingent assets and liabilities at the date
of the financial statements; and
- - reported amounts of sales and expenses during the reporting
period.
Actual results could differ from these estimates.
3. Comprehensive Income (Loss)
We adopted Statement of Financial Accounting Standards No. 130,
"Reporting Comprehensive Income" (SFAS 130), in the first quarter
of 1998. SFAS 130 establishes standards for the reporting and
display of comprehensive income (loss). Components of
comprehensive income (loss) include net income and foreign
currency translation adjustments. The components of
comprehensive income (loss) are as follows (in
millions):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended June
June 30, 30,
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net income $ 25.9 $ 9.5 $ 42.9 $ 1.1
Foreign currency
translation
adjustment (0.7) (2.1) (12.0) (7.9)
------ ----- ------ -----
Comprehensive income
(loss) $ 25.2 $ 7.4 $ 30.9 $(6.8)
====== ===== ====== =====
</TABLE>
4. Net Earnings Per Share
We continue to follow Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" (SFAS 128) to determine earnings per share.
SFAS 128 simplifies the computation of earnings per share (EPS),
where:
- "basic earnings per share" includes only actual weighted
average shares outstanding; and
- "diluted earnings per share" includes the effect of any
items that are dilutive, such as stock options.
The following table summarizes the computation of EPS (in
millions, except amounts per share):
<TABLE>
<CAPTION>
Three Months Ended June 30,
1999 1998
---- ----
Per Per
Net Share Net Share
Earnings Shares Amount Earnings Shares Amount
<S> <C> <C> <C> <C> <C> <C>
Basic EPS:
Net earnings $ 25.9 28.6 $ 0.91 $ 9.5 27.9 $ 0.34
Effect of
dilutive
stock options - 1.0 (0.04) - 1.5 (0.02)
------ ---- ------ ----- ----- ------
Diluted EPS:
Net earnings $ 25.9 29.6 $ 0.87 $ 9.5 29.4 $ 0.32
====== ==== ====== ===== ==== ======
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended June 30,
1999 1998
---- ----
Per Per
Net Share Net Share
Earnings Shares Amount Earnings Shares Amount
<S> <C> <C> <C> <C> <C> <C>
Basic EPS:
Net earnings $ 42.9 28.5 $ 1.51 $ 1.1 27.8 $ 0.04
Effect of
dilutive
stock options - 1.1 (0.06) - 1.3 -
------ ---- ------ ----- ---- ------
Diluted EPS:
Net earnings $ 42.9 29.6 $ 1.45 $ 1.1 29.1 $ 0.04
====== ==== ====== ===== ==== ======
</TABLE>
5. Sale of Receivables
In the first half of 1999 we sold certain financial assets
(primarily consisting of customer lease receivables) as part of
our plan to reduce debt and provide funds for integration
purposes. The net book value of financial assets sold was $26.8
million for which we received approximately $27.6 million in cash
proceeds. In the first half of 1998, we sold similar assets with
a net book value of $31.9 million for cash proceeds of $36.8
million. Under the provisions of Statement of Financial
Accounting Standards No. 125, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishment of Liabilities",
the transactions were accounted for as sales and as a result the
related receivables have been excluded from the accompanying
Condensed Consolidated Balance Sheets. We have established a
reserve for potential losses, since the sales are subject to
certain recourse provisions.
6. Inventories
Inventories consisted of the following (in millions):
<TABLE>
<CAPTION>
June 30, 1999 December 31, 1998
------------- -----------------
<S> <C> <C>
Finished products $ 192.5 $ 183.2
Raw materials, parts and 102.9 95.1
assemblies 22.8 24.5
Work in process ------- -------
$ 318.2 $ 302.8
======= =======
</TABLE>
7. Provision for Restructuring Operations
We recorded a restructuring charge of $19.1 million, $11.2
million after taxes, in the fourth quarter of 1998. The
following table details the activity within the provision for the
six months ended June 30, 1999 (in millions):
<TABLE>
<CAPTION>
Facility
Consolidation
and
Personnel Asset related
and Other Write-offs Total
--------- ------------- -----
<S> <C> <C> <C>
Balance at December 31, 1998:
Consolidation of sales, general
administrative and technical
functions $10.1 $ - $10.1
Changes in
manufacturing/production 3.2 5.8 9.0
---- ---- ----
Remaining provision included in
accrued expenses 13.3 5.8 19.1
1999 year-to-date activity:
Consolidation of sales, general
administrative and technical
functions (0.3) - (0.3)
Changes in
manufacturing/production (0.3) (0.3) (0.6)
----- ----- -----
Total 1999 year-to-date
activity (0.6) (0.3) (0.9)
----- ----- -----
Balance at June 30, 1999:
Consolidation of sales, general
administrative and technical
functions 9.8 - 9.8
Changes in
manufacturing/production 2.9 5.5 8.4
----- ----- -----
Balance at June 30, 1999 $12.7 $5.5 $18.2
===== ===== =====
</TABLE>
In the fourth quarter of 1997 we recorded a restructuring charge
of $59.4 million, $36.4 million after taxes. The following table
details the activity in the first half of 1999 and the balances
of the major components of the 1997 restructuring provision (in
millions):
<TABLE>
<CAPTION>
Facility
Consolidation
and
Personnel Asset related
and Other Write-offs Total
--------- ------------- -----
<S> <C> <C> <C>
Balance at December 31, 1998:
Consolidation of sales, general
administrative and technical
functions $12.8 $3.9 $16.7
Changes in
manufacturing/production 1.9 3.9 5.8
----- ---- -----
Remaining provision included in
accrued expenses 14.7 7.8 22.5
1999 year-to-date activity:
Consolidation of sales, general
administrative and technical
functions (8.7) (1.5) (10.2)
Changes in
manufacturing/production - (0.1) (0.1)
----- ----- -----
Total 1999 year-to-date
activity (8.7) (1.6) (10.3)
----- ----- -----
Balance at June 30, 1999:
Consolidation of sales, general
administrative and technical
functions 4.1 2.4 6.5
Changes in
manufacturing/production 1.9 3.8 5.7
----- ----- -----
Balance at June 30, 1999 $ 6.0 $6.2 $12.2
===== ==== =====
</TABLE>
8. Debt Financing and Guarantor Subsidiaries
In March 1998, we issued $160.0 million of 7.10% Senior Notes due
2003 and $240.0 million of 7.45% Senior Notes due 2008 (the
"Offering"). We used the net proceeds of $394.3 million to
reduce borrowings and commitments under our bank facilities and
for operating purposes. In connection with the Offering, certain
of our subsidiaries (the "Guarantor Subsidiaries") jointly,
fully, severally, and unconditionally guaranteed such notes. We
present below the supplemental condensed financial information
(in millions) of the Company, Guarantor Subsidiaries and Non-
Guarantor Subsidiaries. Please note that in this footnote, we
used the equity method of accounting for our investments in
subsidiaries and the Guarantor Subsidiaries' investments in Non-
Guarantor Subsidiaries. This financial information should be
read in conjunction with the Condensed Consolidated Financial
Statements.
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Elimina- Consoli-
Parent diaries diaries tions dated
------ ------- ------- ------- -------
Condensed Consolidated
Balance Sheet at
June 30, 1999
<S> <C> <C> <C> <C> <C>
Assets:
Cash and
equivalents $ (35.3) $ (0.9) $ 49.2 $ - $ 13.0
Trade and other
receivables 241.0 8.4 283.4 - 532.8
Inventories 177.8 61.2 120.3 (41.1) 318.2
Other current assets 260.1 565.0 74.0 (812.2) 86.9
-------- ------- ------- -------- --------
Total current
assets 643.6 633.7 526.9 (853.3) 950.9
Property, plant and
equipment, net 143.5 88.8 142.4 (70.4) 304.3
Intangibles, net 31.8 374.0 3.6 - 409.4
Goodwill, net 9.7 332.3 9.1 - 351.1
Other assets 1,385.5 120.8 278.1 (1,690.1) 94.3
-------- -------- -------- -------- --------
Total assets $2,214.1 $1,549.6 $ 960.1 $(2,613.8) $2,110.0
======== ======== ======== ========= ========
Liabilities:
Notes payable and
current maturities
of long-term
debt $ 35.1 $ 1.6 $ 72.4 $ - $ 109.1
Accounts payable
and accrued
expenses 319.0 51.9 77.4 - 448.3
Other current
liabilities 197.3 595.9 115.2 (836.0) 72.4
-------- --------- -------- -------- --------
Total current
liabilities 551.4 649.4 265.0 (836.0) 629.8
Long-term debt, less
current maturities 946.4 0.8 48.2 - 995.4
Other long-term
liabilities 555.5 276.7 208.3 (716.5) 324.0
-------- --------- -------- -------- --------
Total
liabilities 2,053.3 926.9 521.5 (1,552.5) 1949.2
Total stockholders'
equity 160.8 622.7 438.6 (1,061.3) 160.8
-------- --------- -------- -------- --------
Total
liabilities
and stockholders'
equity $2,214.1 $ 1,549.6 $ 960.1 $(2,613.8) $2,110.0
======== ========= ======== ======== ========
</TABLE>
[CAPTION]
<TABLE>
Non-
Guarantor Guarantor
Subsi- Subsi- Elimina- Consoli-
Parent diaries diaries tions dated
------ ------- ------- ------- -------
Condensed Consolidated
Balance Sheet
December 31, 1998
<S> <C> <C> <C> <C> <C>
Assets:
Cash and
equivalents $ 4.2 $ (0.1) $ 20.6 $ - $ 24.7
Trade and
other receivables 199.9 50.4 289.9 - 540.2
Inventories 146.5 52.6 134.6 (30.9) 302.8
Other current assets 149.0 396.4 86.7 (543.2) 88.9
------ ------ ------ ------- -------
Total current
assets 499.6 499.3 531.8 (574.1) 956.6
Property, plant and
equipment, net 120.7 89.1 156.3 (56.7) 309.4
Intangibles, net 33.0 384.8 1.3 - 419.1
Goodwill, net 15.0 329.5 11.6 - 356.1
Other long-term
assets 1,357.1 176.0 253.2 (1,694.2) 92.1
------- ------- ------ -------- -------
Total assets $2,025.4 $1,478.7 $954.2 $(2,325.0) $2,133.3
======= ======= ====== ======= =======
Liabilities:
Notes payable and
current maturities
of long-term
debt $ 19.6 $ 2.6 $112.9 $ - $ 135.1
Accounts payable
and accrued
expenses 219.5 199.7 103.8 - 523.0
Other current
liabilities 176.0 323.9 83.2 (521.9) 61.2
------- ------ ------ ------- -------
Total current
liabilities 415.1 526.2 299.9 (521.9) 719.3
Long-term debt,
less current
maturities 950.8 0.8 30.6 - 982.2
Other long-term
liabilities 532.6 279.6 214.4 (721.7) 304.9
------- ------ ------ ------- -------
Total
liabilities 1,898.5 806.6 544.9 (1,243.6) 2,006.4
Total stockholders'
equity 126.9 672.1 409.3 (1,081.4) 126.9
------- ------ ------ ------- -------
Total liabilities
and
stockholders'
equity $2,025.4 $1,478.7 $ 954.2 $(2,325.0) $2,133.3
======= ======= ====== ======== =======
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Elimina- Consoli-
Parent diaries diaries tions dated
----- ------- ------- ------- --------
Condensed Consolidated
Statement of
Operations
Quarter ended
June 30, 1999
<S> <C> <C> <C> <C> <C>
Sales $300.6 $100.9 $284.2 $(239.5) $446.2
Operating costs and
expenses:
Cost of sales 212.0 60.6 204.8 (243.3) 234.1
Selling, general
and administrative 56.8 12.7 46.0 - 115.5
Research and
development 27.3 13.3 1.9 - 42.5
------ ------ ------ ------ ------
Operating income 4.5 14.3 31.5 3.8 54.1
Nonoperating (income)
expense (33.9) 1.4 (1.3) 49.8 16.0
------ ------ ------ ------ ------
Earnings (loss) before
income taxes 38.4 12.9 32.8 (46.0) 38.1
Income tax
expense (benefit) 19.9 3.2 17.3 (28.2) 12.2
------ ------ ------ ------ ------
Net earnings (loss) $18.5 $ 9.7 $ 15.5 $ (17.8) $ 25.9
====== ====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Elimina- Consoli-
Parent diaries diaries tions dated
------ ------- ------- ------- -------
Condensed Consolidated
Statement of
Operations
Quarter ended
June 30, 1998
<S> <C> <C> <C> <C> <C>
Sales $190.2 $132.5 $203.1 $(91.1) $434.7
Operating costs and
expenses:
Cost of sales 117.8 77.1 132.7 (91.1) 236.5
Selling, general
and administrative 40.3 33.3 50.0 - 123.6
Research and
development 24.9 16.0 1.3 - 42.2
Restructuring
charge (3.8) - 3.8 - -
------ ------ ------ ------ ------
Operating income 11.0 6.1 15.3 - 32.4
Nonoperating expense
(income) 19.9 (9.2) 7.7 - 18.4
------ ------ ------ ------ ------
(Loss) earnings before
income taxes (8.9) 15.3 7.6 - 14.0
Income tax
(benefit) expense (3.1) 5.5 1.4 0.7 4.5
------ ------ ------ ------ ------
Net (loss) earnings $ (5.8) $ 9.8 $ 6.2 $ (0.7) $ 9.5
====== ====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Elimina- Consoli-
Parent diaries diaries tions dated
------ ------- ------- -------- --------
Condensed Consolidated
Statement of
Operations
six months ended
June 30, 1999
<S> <C> <C> <C> <C> <C>
Sales $582.6 $189.1 $500.7 $(421.1) $851.3
Operating costs and
expenses:
Cost of sales 393.3 117.2 356.0 (421.1) 445.4
Selling, general
and administrative 108.3 26.7 92.3 - 227.3
Research and
development 51.9 26.0 3.3 - 81.2
------ ------ ------ ------ ------
Operating income 29.1 19.2 49.1 - 97.4
(loss)
Nonoperating (income)
expense (5.4) (1.1) (0.2) 41.0 34.3
------ ------ ------ ------ ------
Earnings (loss) before
income taxes 34.5 20.3 49.3 (41.0) 63.1
Income tax expense
(benefit) 17.9 4.3 24.4 (26.4) 20.2
------ ------ ------ ------ ------
Net earnings (loss) $16.6 $ 16.0 $ 24.9 $ (14.6) $ 42.9
====== ====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Elimina- Consoli-
Parent diaries diaries tions dated
------ ------- ------- ------ -------
Condensed Consolidated
Statement of
Operations
six months ended
June 30, 1998
<S> <C> <C> <C> <C> <C>
Sales $380.0 $273.6 $358.9 $(178.4) $834.1
Operating costs and
expenses:
Cost of sales 238.7 165.4 240.6 (178.4) 466.3
Selling, general
and administrative 82.5 67.4 93.4 - 243.3
Research and
development 48.2 33.1 2.5 - 83.8
Restructuring charge - - 4.4 (4.4) -
------ ------ ------ ------ ------
Operating income 10.6 7.7 18.0 4.4 40.7
Nonoperating expense
(income) 40.5 (17.3) 15.9 - 39.1
------ ------ ------ ------ ------
(Loss) earnings before
income taxes (29.9) 25.0 2.1 4.4 1.6
Income tax
(benefit) expense (10.4) 8.9 0.5 1.5 0.5
------ ------ ------ ------ ------
Net (loss) earnings $(19.5) $ 16.1 $ 1.6 $ 2.9 $ 1.1
====== ====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Consoli-
Parent diaries diaries dated
------ ------- ------- -------
Condensed Consolidated
Statement of Cash
Flows
six months ended
June 30, 1999
<S> <C> <C> <C> <C>
Net cash (used)
provided $ 1.8 $ (28.4) $ 87.0 $ 60.4
by operating
activities
Cash flows from
investing
activities:
Additions to property,
plant and equipment (29.2) (2.5) (34.5) (66.2)
Net disposals of
property,
plant and equipment 0.1 - 2.6 2.7
------ ------ ------ ------
Net cash used by
investing
activities (29.1) (2.5) (31.9) (63.5)
Cash flows from
financing
activities:
Dividends to (9.1) - - (9.1)
stockholders
Proceeds from issuance
of stock 12.4 - - 12.4
Notes payable
(reductions) 16.4 - (41.1) (24.7)
Net intercompany
(reductions) (26.8) 30.1 (3.3) -
borrowings
Long-term debt
(reductions) (5.1) - 18.0 12.9
borrowings ------ ------ ------ ------
Net cash provided
(used)
by financing
activities (12.2) 30.1 (26.4) (8.5)
------ ------ ------ ------
Effect of exchange
rates - - (0.1) (0.1)
on cash and ------ ------ ------ ------
equivalents
(Decrease) increase
in cash and
equivalents (39.5) (0.8) 28.6 (11.7)
Cash and equivalents
- beginning of
period 4.2 (0.1) 20.6 24.7
------ ------ ------ ------
Cash and equivalents
- end of period $(35.3) $(0.9) $ 49.2 $ 13.0
====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Eliminat- Consoli-
Parent diaries diaries ions dated
------ ------- ------- -------- --------
Condensed Consolidated
Statement of Cash
Flows
six months ended
June 30, 1998
<S> <C> <C> <C> <C> <C>
Net cash (used)
provided $(42.7) $(51.8) $ 2.3 $ - $ (92.2)
by operating ------ ------ ------ ------ ------
activities
Cash flows from
investing
activities:
Additions to property,
plant and equipment (22.7) (9.2) (50.7) - (82.6)
Net disposals of
property, plant
and equipment 13.1 0.7 30.2 - 44.0
Proceeds from sales-
leaseback
transactions 186.1 - - 56.7 242.8
Investments and
acquisitions 3.6 (0.4) 0.4 - 3.6
------ ------ ------ ------ ------
Net cash provided
(used)
by investing
activities 180.1 (8.9) (20.1) 56.7 207.8
------ ------ ------ ------ ------
Cash flows from
financing
activities:
Dividends to
stockholders (8.3) - - - (8.3)
Proceeds from issuance
of stock 7.5 - - - 7.5
Notes
payable (reductions)
borrowings - (1.3) 0.7 - (0.6)
Long-term debt
(reductions)
borrowings (122.0) 56.4 4.7 (56.7) (117.6)
------ ------ ------ ------ ------
Net cash (used)
provided
by financing
activities (122.8) 55.1 5.4 (56.7) (119.0)
Effect of exchange
rates
on cash and
equivalents 0.4 - 0.5 - 0.9
------ ------ ------ ------ ------
Increase (decrease)
in cash and
equivalents 15.0 (5.6) (11.9) - (2.5)
Cash and equivalents
- beginning of
period 13.9 7.3 12.3 - 33.5
Cash and equivalents ------ ------ ------ ------ ------
- end of period $ 28.9 $1.7 $ 0.4 $ - $ 31.0
====== ====== ====== ====== ======
</TABLE>
9. Contingencies
We are involved in a number of lawsuits, which we consider normal
in view of our size and the nature of our business. We do not
believe that any liability resulting from any such lawsuits will
have a material adverse effect on our operations, financial
position or liquidity.
10. Business Segment Information
We adopted Statement of Financial Accounting Standards No.
131, "Disclosures about Segments of an Enterprise and Related
Information" ("SFAS 131"), beginning with the 1998 annual report.
SFAS 131 requires segments to be determined and reported based on
how management measures performance and makes decisions about
allocating resources.
We are engaged primarily in the design, manufacture and sale
of laboratory instrument systems and related products. Our
organization has two reportable segments: (1) clinical
diagnostics and (2) life science research. The clinical
diagnostics segment encompasses diagnostic applications,
principally in hospital laboratories. The life science research
segment includes life sciences and drug discovery applications in
universities, medical schools, and pharmaceutical and
biotechnology companies. All corporate activities including
financing transactions are captured in a central services
"Center", which is reflected in the table below. We evaluate
performance based on profit or loss from operations. Although
primarily operating in the same industry, reportable segments are
managed separately, since each business requires different
marketing strategies and has different customers.
<TABLE>
<CAPTION>
(in millions) For the quarters ended For the six months
June 30, ended June 30,
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales
Clinical
diagnostics $ 353.4 $ 342.3 $ 680.1 $ 663.7
Life science
research 92.8 92.4 171.2 170.4
Center - - - -
------- ------- ------- -------
Consolidated $ 446.2 $ 434.7 $ 851.3 $ 834.1
------- ------- ------- -------
Operating income
(loss)
Clinical
diagnostics $ 53.1 $ 39.7 $ 108.0 $ 68.4
Life science
research 10.5 11.5 16.8 11.8
Center (9.5) (18.8) (27.4) (39.5)
------- ------- ------- -------
Consolidated $ 54.1 $ 32.4 $ 97.4 $ 40.7
------- ------- ------- -------
Interest income
Clinical
diagnostics $ (0.5) $ (3.2) $ (1.5) $ (5.8)
Life science
research - - - -
Center (1.3) (0.8) (2.3) (1.3)
------- ------- ------- -------
Consolidated $ (1.8) $ (4.0) $ (3.8) $ (7.1)
------- ------- ------- -------
Interest expense
Clinical
diagnostics $ - $ - $ - $ -
Life science
research - - - -
Center 18.9 22.9 37.1 49.1
------- ------- ------- -------
Consolidated $ 18.9 $ 22.9 $ 37.1 $ 49.1
------- ------- ------- -------
</TABLE>
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
---- ----
<S> <C> <C>
Total assets
Clinical diagnostics $1,490.3 $1,519.2
Life science research 172.2 199.2
Center 447.5 414.9
-------- --------
Consolidated $2,110.0 $2,133.3
-------- --------
</TABLE>
<TABLE>
<CAPTION>
Geographic areas
(in millions) For the quarters ended For the six months
June 30, ended June 30,
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales to external
customers
North America $249.1 $223.2 $476.9 $463.2
Europe 133.9 132.8 254.9 239.3
Asia and other areas 63.2 78.7 119.5 131.6
------ ------ ------ ------
Consolidated $446.2 $434.7 $851.3 $834.1
====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
---- ----
<S> <C> <C>
Long-lived assets
North America $ 778.3 $ 814.7
Europe 301.4 273.3
Asia and other areas 79.4 88.7
-------- --------
Consolidated $1,159.1 $1,176.7
======== ========
</TABLE>
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Overview
We are Beckman Coulter, Inc. (formerly known as Beckman
Instruments, Inc. and renamed Beckman Coulter, Inc. after the
acquisition of Coulter Corporation), a world leader in providing
systems that simplify and automate laboratory processes. We
design, manufacture and service a broad range of laboratory
systems consisting of instruments, reagents and related products
that customers use to conduct basic scientific research, drug
discovery research and diagnostic analysis of patient samples.
Our strategy is to solidify our position as a leading provider of
laboratory systems. On October 31, 1997, we achieved a
significant milestone in accomplishing this strategy when we
acquired Coulter Corporation ("Coulter"). Through this
acquisition we added Coulter's leading market position in
hematology and number two position in flow cytometry to our
existing market position.
The next milestone towards our global strategy, "One Face to the
Customer", offering our customers a single sales source, a single
sales contact and a single organization for service to meet all
their testing needs, was fully operational in the first quarter of
1999.
We believe that the success of our integration programs has
allowed us to meet our profitability targets, while our combined
clinical diagnostics portfolio is providing important sales
synergy and competitive wins in a constrained market. However,
we do not guarantee the extent to which we will continue to
realize the benefits of the integration, or the timing of any
such realization.
Results of operations
Sales in the second quarter of 1999 grew 2.6% (2.4% excluding the
effect of foreign currency rate changes) compared to the same
period in the prior year. Sales in North America increased 11.6%
and sales in Europe increased 0.8% during the second quarter
compared to the same period in the prior year, but were offset by
a decrease of 19.7% in Asia and other international markets.
European sales were dampened by softness in the German market
along with a slow down at one of our European distributors. In
North America, increased instrument sales under sales-type lease
arrangements in the current period resulted in an increase in
reported revenues, as revenues on the instrument portion of sales-
type leases are recognized immediately. Decreased sales in Asia
are primarily attributable to Japan's troubled economy and
China's national reorganization of its life science research
infrastructure.
Sales in the first half of 1999 grew 2.1% (1.6% excluding the
effect of foreign currency rate changes) compared to the first
half of 1998. The increase in sales was due to the factors
mentioned previously as well as:
- inclusion of six months of Coulter international sales in
the first half of 1999 compared to only five months in the first
half of 1998 due to the lagging of Coulter international results
of operations; offset by
- inclusion of higher sales in the first half of 1998 from
what would have traditionally been the fourth quarter for the old
Coulter business (Coulter's fiscal year previously ended on March
31).
Gross profit as a percentage of sales in the second quarter of
1999 was 47.5%, 1.9 percentage points higher than the same period
in the prior year primarily due to synergies associated with the
integration of the Beckman and Coulter organizations.
For the first half of 1999, gross profit as a percentage of sales
was 47.7%, 3.6 percentage points higher than the same period in
1998. In 1998 gross margins were lower due to a one-time
increase in cost of sales of $5.7 million related to inventory
revaluation from the Coulter acquisition. The absence of this
one-time charge in 1999, combined with the synergies from the
combination of Beckman and Coulter organizations contributed to
higher gross margins in 1999.
Selling, general and administrative expenses ("SG&A") declined in
absolute dollars and as a percentage of sales both in the three
and six month periods ended June 30, 1999 as compared to the same
periods in the prior year due to continuing progress with the
integration activities. SG&A declined $8.1 million to $115.5
million or 25.9% of sales in the second quarter of 1999 from
$123.6 million or 28.4% of sales in the second quarter of 1998.
In the first half of 1999, SG&A was $227.3 million or 26.7% of
sales compared to $243.3 million or 29.2% of sales in the first
half of 1998 representing a decrease of $16.0 million or 6.6%
from the prior period.
In accordance with our integration plans, during the second
quarter of 1999, we began moving the manufacturing of certain
products from our manufacturing operations in Germany and the
United States to Ireland. We expect the additional expenses
associated with these moves to be offset by the potential tax
savings which should result from manufacturing in a more tax-
advantaged location. In addition to the tax savings, the move is
expected to expand the manufacturing and technical knowledge base
for these products in Ireland, and to accommodate future Far East
volume requirements for the same products with minimal
incremental expenditure. As part of our integration efforts, we
intend to continue to make further opportunistic changes in the
second half of 1999 and beyond.
Net income for the second quarter of 1999 was $25.9 million or
$0.87 per diluted share compared to $9.5 million or $0.32 per
diluted share. For the first half of 1999, net income amounted
to $42.9 million or $1.45 per diluted share, compared to $1.1
million or $0.04 per diluted share during the same period in
1998. The increase in net income is primarily due to the various
reasons discussed previously. In addition, a lower average debt
balance as well as slightly lower interest rates in 1999
contributed to a decrease in interest expense from 1998 to 1999,
which in turn contributed to the increase in net income.
Financial Condition
As discussed in greater detail in our 1998 annual report, we are
a highly leveraged company. Although the debt-to-capital ratio
has declined, as planned, from 89.8% at December 31, 1998 to
87.3% at June 30, 1999, among other things, our high level of
debt:
- - increases our vulnerability to general adverse economic and
industry conditions;
- - could limit our ability to obtain additional financing on
favorable terms; and
- - requires the dedication of a substantial portion of our cash
flow from operations to the payment of principal and interest on
indebtedness.
In addition, our agreements with our lenders contain a number of
covenants, which, among other things, require us to comply with
specified financial ratios and tests. At June 30, 1999, we are
in compliance with such financial ratios and tests.
We have and will continue to evaluate opportunities to provide
additional cash flow by monetizing assets during 1999 and beyond,
including sales of certain financial assets (primarily consisting
of equipment subject to customer leases and sales-type lease
receivables) and real estate assets. If remaining sales are
consummated as expected, we believe the total proceeds generated for
1999 will be approximately $30.0 million, less any costs to
complete the transactions.
Operating activities provided net cash of $60.4 million in the
first half of 1999 compared to net cash usage of $92.2 million in
the first half of the prior year. The primary reasons were:
- net earnings were $42.9 million in 1999 compared to $1.1
million in 1998; and
- payments towards costs accrued as part of the Coulter
purchase liability in 1999 were $24.0 million compared to $112.2
million in 1998.
In 1999, investing activities used approximately $63.5 million of
net cash primarily for capital purchases, whereas in 1998,
investing activities provided $207.8 million of net cash, which
included approximately $242.8 million representing net proceeds
from the sale and leaseback of four of our properties.
Net cash used by financing activities was $8.5 million in 1999
compared to $119.0 million in 1998. Cash generated from the sale-
leaseback of our properties mentioned previously was used to
reduce our debt in 1998.
In addition to the decline in our debt-to-capital ratio mentioned
above, the ratio of current assets to current liabilities
improved to 1.5 at June 30, 1999 from 1.3 at December 31, 1998.
Based upon current levels of operations and anticipated cost
savings and future growth, we believe that our cash flow from
operations, together with available borrowings under the credit
facility and other sources of liquidity will be adequate to meet
our anticipated requirements until the maturity of the credit
facility in 2002. However, we cannot give any assurance that our
business will continue to generate cash flows at or above current
levels or that estimated cost savings or growth can be achieved.
Our future operating performance and ability to service or
refinance our existing indebtedness, including the credit
facility, will be subject to future economic conditions and to
financial, business and other factors, many of which are beyond
our control.
On June 3, 1999, we paid a quarterly cash dividend of $0.16 per
share of common stock for a total of $4.5 million.
Year 2000
We believe we have implemented a comprehensive Year 2000 program
that is on schedule for completion by the end of 1999, and that
there will be no material impact on our business, results of
operations, financial position or liquidity as a result of Year
2000 issues.
Our Year 2000 program, implemented worldwide, is directed by our
senior management and includes six main projects:
1. products and services;
2. management information systems;
3. suppliers (materials and services);
4. engineering and manufacturing processes;
5. office equipment; and
6. facilities and utilities.
These projects generally include five phases:
1. inventory;
2. assessment;
3. remediation;
4. testing/validation; and
5. implementation.
The following table is a summary of our Year 2000 program
schedule target dates (1):
Testing/ Implement-
Inventory Assessment Remediation validation ation
--------- ---------- ----------- ---------- ---------
Products & Complete Complete Complete Complete Complete (2)
services
Management
information Complete Complete Complete Q3 1999 (4) Q3 1999 (4)
systems
Suppliers
(materials Complete Complete Complete Q3 1999 (4) Q3 1999 (4)
& services)
Engineering
& Complete Complete Complete Q3 1999 Q3 1999
manufact-
uring
processes
Office Complete Complete Complete Complete (4) Q3 1999
equipment
Facilities Complete Complete Q3 1999 (4) Q3 1999 Q3 1999
and
Utilities Complete Q3 1999 (4) (3) (3) (3)
Notes:
(1) The target dates are the ends of the quarters referred to.
For example Q3 1999 refers to the end of the third quarter of
1999.
(2) Implementation phase for products is defined as the
availability of necessary software and/or hardware upgrades.
(3) These phases will not be performed for utilities, but will
be considered as part of the contingency planning.
(4) Reflects one quarter extension; procedures in process,
only minor issues remain.
A number of our products include computer hardware and
software, including substantial custom software. During 1998, we
began providing our customers information about the Year 2000
status of our products, and made all upgrades available by the
end of the first quarter of 1999 (see table above). At the beginning of the
second quarter of 1999, we put into practice a new plan to manage
the field implementation of these upgrades, which will extend into the
fourth quarter of 1999. We believe there are no significant
Year 2000 product performance issues with respect to products
that we will continue to support after January 1, 2000. We
believe the impact to our business based on Year 2000 product
performance issues or litigation related to those issues will not
be material. However, we cannot give any assurances to that
effect until our entire inventory, assessment, and remediation
activities are completed for all projects in the table above.
We believe our Year 2000 program will be completed on
schedule. But the schedule is based on a number of factors and
assumptions, such as:
- the accuracy and completeness of responses to our inquiries;
and
- the availability of skilled personnel to complete the
program.
The program schedule could be adversely impacted if any of the
factors and assumptions is incorrect. We cannot give assurance
that our Year 2000 program will be completed on schedule or that
we will not uncover Year 2000 issues that could create a material
impact on our performance.
We do not believe that we have a material relationship with
any single third party supplier or customer. Although a
significant interruption in our suppliers' and customers'
activities (due to Year 2000 issues) is unlikely, we could
experience a material impact in our financial results if such an
interruption occurs. Also, a portion of our revenues is
indirectly dependent upon our customers' reimbursement from
federal, state, municipal and foreign government agencies, and
the state of readiness of those government agencies is of
concern. At this time we believe the most reasonably likely
worst case scenario involves a significant interruption in the
ability of one or more government agencies to reimburse those
customers, which could lead to a significant interruption in cash
received from affected customers. We are unable to estimate
either the likelihood or the potential cost of such an
occurrence.
We do not expect that the cost of our Year 2000 program will
be material to our business, results of operations, financial
position or liquidity. We anticipate that the total cost for our
Year 2000 program through 1999 will be approximately $9.0
million. Through June 30, 1999 we have spent approximately $5.7
million on our Year 2000 program. The majority of these costs are
for the remediation or replacement of management information
systems. Most of the funding for our Year 2000 program is
separately budgeted, but a portion of the funding is part of our
management information systems budget. Year 2000 program funding
has delayed the implementation of certain other management
information systems changes, but this delay will have only a
minor impact on managing the Company.
We have established and are implementing a contingency planning process
with respect to Year 2000 issues (including most reasonably likely worse
case Year 2000 scenarios). Although several plans have been developed,
we continue to determine the extent and depth necessary for each aspect
of our business.
Euro - the new European currency
Eleven countries of the European Union have adopted a single
currency known as the "euro". The euro came into existence on
January 1, 1999, and is the official currency for the countries
of the Economic and Monetary Union (Austria, Belgium, Finland,
France, Germany, Holland, Ireland, Italy, Luxembourg, Portugal
and Spain) with national currencies expressed as a denomination
(national currency units) of the euro. During the three-year
transition period following its introduction, countries will be
allowed to transact business both in the euro and in their own
currencies at fixed conversion rates. On January 1, 2002, the
euro will be the only currency in Economic and Monetary Union
countries.
We conduct business in more than 120 countries, generating
approximately 50% of revenues outside the United States. A
significant portion of our business is conducted in Europe. The
introduction of the euro requires that we make modifications to
our internal operations as well as to our external business
arrangements. For example, product pricing and sales proposals
are now available in the euro. Similarly, our billing and
disbursement functions have been modified to reflect the use of
the euro.
Early in 1997, we established a six-member task force
reporting to the chief financial officer to identify the issues
related to the introduction of the euro and to develop and
implement a plan to address those issues. The task force has
developed a detailed plan for the euro implementation addressing
all areas of operations, both internal and external. Major
initiatives resulting from the recommendations of the task force
are:
- create a "Beckman Coulter Euro Information Center" to
facilitate worldwide communication related to the euro;
- accommodate our customers' preferences for their national
currency or the euro during the transition period;
- operate in a multi-currency environment (including the euro,
national currency and the U.S. dollar), during the transition
period, in all the European countries in which we do business;
and
- adopt use of the euro for internal systems and reporting as
of December 1, 2001.
We do not expect the cost of this effort to have a material
effect on our business, results of operations, financial position
or liquidity. However, we cannot guarantee that all problems
will be foreseen and corrected, or that no material disruption of
our business will occur. There is also likely to be competitive
implications on our pricing and marketing strategies related to
the conversion to the euro; however, we do not know the effects
of any such impact at this time.
Business Climate
In the U.S., the life science research market continues to show
signs of improvement, stimulated by the general economy. The
clinical diagnostic market is under pressure from significant
cost containment efforts and the overall restructuring of the
industry, compounded by the uncertainty of the future direction
of healthcare reforms. In 1999, portions of these markets served
by us are expected to grow in the low single digits.
The Asia Pacific market, including Japan, continues to be
severely impacted by economic uncertainty. The two key factors
are:
1.the recession in Japan, which is limiting the release of
life science research funding; and
2.the currency crisis which has affected most countries in
Southeast Asia.
In general, the European clinical diagnostics and life science
research markets continue to be dampened by cost containment
initiatives as part of governmental fiscal management
policies. These policies are driven in large part by the
requirements for the ongoing European monetary union.
Forward Looking Statements
All statements contained in this quarterly report, or in any
document we file with the Securities and Exchange Commission, or
in any press release or other written or oral communication by or
on behalf of our company, that do not directly and exclusively
relate to historical facts constitute "forward-looking
statements" within the meaning of the Private Securities
Litigation Reform Act of 1995.
This 10-Q report contains such forward-looking statements,
including statements regarding, among other items:
1. anticipated benefits, including potential tax savings, from
integration of manufacturing operations;
2. anticipated proceeds from the sale of assets;
3. anticipated trends in our business and market growth;
4. our cash flow, liquidity requirements, and our ability to
service debt; and
5. the impact of Year 2000 issues on our operations.
These forward-looking statements are based on our expectations
and are subject to a number of risks and uncertainties, some of
which are beyond our control. These risks and uncertainties
include, but are not limited to:
1. complexity and uncertainty regarding development of new high-
technology products;
2. loss of market share through aggressive competition in the
clinical diagnostics and life science research markets;
3. our dependence on capital spending policies and government
funding;
4. the effect of potential healthcare reforms;
5. general economic conditions in countries in which we do
business, such as, Japan and Germany;
6. fluctuations in foreign exchange rates and interest rates;
7. reliance on patents and other intellectual property;
8. difficulties, delays or failure in effectively integrating
worldwide operations;
9. unanticipated Year 2000 or euro problems; and
10. other factors that cannot be identified at this time.
Although we believe we have the product offerings and resources
required to achieve our objectives, actual results could differ
materially from those anticipated by these forward-looking
statements. There can be no assurance that events anticipated by
these forward-looking statements will in fact transpire as
expected.
<PAGE>
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes In Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security-Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
11. Statement re Computation of Per Share Earnings:
This information is set forth in Note 4, Net Earnings
Per Share of the Condensed Consolidated Financial
Statements included in Part I herein.
15. Independent Accountants' Review Report, July 21, 1999.
27. Financial Data Schedule for the six
month period ended June 30, 1999.
b) Reports on Form 8-K
None.
<PAGE>
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.
BECKMAN COULTER, INC.
(Registrant)
Date: August 2, 1999 by WILLIAM H. MAY
_______________________________
William H. May
Vice President, General
Counsel and Secretary
Date: August 2, 1999 by JAMES T. GLOVER
_______________________________
James T. Glover
Vice President and
Controller
<PAGE>
EXHIBIT INDEX
FORM 10-Q, SECOND QUARTER, 1999
Exhibit
Number Description
- ------- -----------
11. Statement re Computation of Per Share Earnings: This
information is set forth in Note 4, Net Earnings Per Share,
of the Condensed Consolidated Financial Statements
included in Part I herein.
15. Independent Accountants' Review Report, July 21, 1999.
27. Financial Data Schedule for the six month period
ended June 30, 1999.
Exhibit 15
KPMG LLP
Center Tower
650 Town Center Drive
Costa Mesa, CA 92626
Independent Accountants' Review Report
The Stockholders and Board of Directors
Beckman Coulter, Inc.:
We have reviewed the condensed consolidated balance sheet of
Beckman Coulter, Inc. and subsidiaries as of June 30, 1999, and
the related condensed consolidated statements of operations
for the three-month and six-month periods ended June 30, 1999 and 1998,
and the Condensed Consolidated Statements of cash flows for the
six-month periods ended June 30, 1999 and 1998. These condensed
consolidated financial statements are the responsibility of the
Company's management.
We conducted our review in accordance with standards established
by the American Institute of Certified Public Accountants. A
review of interim financial information consists principally of
applying analytical procedures to financial data and making
inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing
standards, the objective of which is the expression of an opinion
regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material
modifications that should be made to the condensed consolidated
financial statements referred to above for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the consolidated balance sheet of Beckman
Coulter, Inc. and subsidiaries as of December 31, 1998, and the
related consolidated statements of operations, stockholders'
equity and cash flows for the year then ended (not presented
herein); and in our report dated January 22, 1999, we expressed
an unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in the
accompanying condensed consolidated balance sheet as of December
31, 1998, is fairly stated, in all material respects, in relation
to the consolidated balance sheet from which it has been derived.
(KPMG LLP)
Orange County, California
July 21, 1999
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Condensed Consolidated Balance Sheet and the Condensed Consolidated Statement of
Earnings and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
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0
0
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</TABLE>
