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, 2000
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 31, 2000: 29,582,024 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, 2000 and 1999
Condensed Consolidated Balance Sheets
as of June 30, 2000 and December 31, 1999
Condensed Consolidated Statements of
Cash Flows for the six month periods
ended June 30, 2000 and 1999
Notes to Condensed Consolidated
Financial Statements
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations
Item 3. Quantitative and Qualitative Disclosures
About Market Risk
<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>
ITEM 1. FINANCIAL STATEMENTS
BECKMAN COULTER, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Millions, Except Amounts Per Share and Share Data)
Unaudited
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales $469.4 $446.2 $903.8 $851.3
Cost of sales 245.8 234.1 477.3 445.4
------ ------ ------ ------
Gross profit 223.6 212.1 426.5 405.9
------ ------ ------ ------
Operating costs and expenses:
Selling, general and
administrative 117.4 115.5 232.6 227.3
Research and development 45.8 42.5 86.7 81.2
------ ------ ------ ------
Total operating costs and
expenses 163.2 158.0 319.3 308.5
------ ------ ------ ------
Operating income 60.4 54.1 107.2 97.4
------- ------ ------ ------
Nonoperating (income) and
expenses:
Interest income (2.1) (1.8) (3.5) (3.8)
Interest expense 17.9 18.9 36.5 37.1
Other, net (2.4) (1.1) (3.2) 1.0
------ ------ ------ ------
Total nonoperating expenses 13.4 16.0 29.8 34.3
------ ------ ------ ------
Earnings before income taxes 47.0 38.1 77.4 63.1
Income taxes 14.6 12.2 24.0 20.2
------ ------ ------ ------
Net earnings $ 32.4 $ 25.9 $ 53.4 $ 42.9
====== ====== ====== ======
Basic earnings per share $ 1.10 $ 0.91 $ 1.83 $ 1.51
Weighted average number of
shares outstanding
(in thousands) 29,376 28,584 29,236 28,525
Diluted earnings per share $ 1.05 $ 0.87 $ 1.75 $ 1.45
Weighted average number of
shares and dilutive shares
outstanding (in thousands) 30,761 29,611 30,487 29,588
Dividends declared per share $ 0.16 $ 0.16 $ 0.32 $ 0.32
</TABLE>
See accompanying notes to condensed consolidated financial
statements.
<PAGE>
BECKMAN COULTER, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in Millions, Except Amounts per Share)
<TABLE>
<CAPTION>
June 30, December 31,
2000 1999
Unaudited
<S> <C> <C>
Assets
Current assets:
Cash and equivalents $ 21.9 $ 34.4
Trade and other receivables 499.8 566.4
Inventories 349.4 313.1
Other current assets 53.2 52.5
-------- --------
Total current assets 924.3 966.4
Property, plant and equipment, net 282.9 305.9
Goodwill, less accumulated amortization of
$31.8 and $26.3 at June 30, 2000 and
December 31, 1999, respectively 345.5 344.7
Other intangibles, less accumulated
amortization of $56.5 and $46.8 at
June 30, 2000 and December 31, 1999,
respectively 390.2 399.9
Other assets 67.1 93.9
-------- --------
Total assets $2,010.0 $2,110.8
======== ========
Liabilities and Stockholders' Equity
Current liabilities:
Notes payable and current maturities of
long-term debt $ 28.6 $ 50.0
Accounts payable, accrued expenses and
other liabilities 379.0 474.1
Income taxes 65.5 51.8
-------- --------
Total current liabilities 473.1 575.9
Long-term debt, less current maturities 935.4 980.7
Other liabilities 336.6 326.3
-------- --------
Total liabilities 1,745.1 1,882.9
-------- --------
Stockholders' equity:
Preferred stock, $0.10 par value;
authorized 10.0 shares; none issued - -
Common stock, $0.10 par value; authorized
150.0 shares; shares issued 29.5 and 29.1
at June 30, 2000 and December 31, 1999,
respectively; shares outstanding 29.5
and 29.0 at June 30, 2000 and December 31,
1999, respectively 3.0 2.9
Additional paid-in capital 145.3 134.5
Retained earnings 167.0 123.0
Accumulated other comprehensive loss:
Cumulative foreign currency translation
adjustment (50.4) (24.3)
Treasury stock, at cost - (8.2)
-------- --------
Total stockholders' equity 264.9 227.9
-------- --------
Total liabilities and stockholders'
equity $2,010.0 $2,110.8
======== ========
</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,
2000 1999
---- ----
<S> <C> <C>
Cash Flows from Operating Activities
Net earnings $ 53.4 $ 42.9
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Depreciation and amortization 67.6 74.5
Net deferred income taxes 10.1 (0.3)
Proceeds from sales of sales-type lease
receivables 48.3 27.4
Gain on sale of property, plant and equipment (1.7) -
Changes in assets and liabilities:
Trade and other receivables 21.4 (14.6)
Inventories (39.3) (16.9)
Accounts payable, accrued expenses and
other liabilities (90.0) (73.0)
Income taxes payable 14.2 11.4
Other 4.2 9.0
------- -------
Net cash provided by operating
activities 88.2 60.4
------- -------
Cash Flows from Investing Activities
Additions to property, plant and equipment (72.0) (66.2)
Proceeds from sale of certain clinical
chemistry assets 15.0 -
Proceeds from sale of property, plant and
equipment 15.2 2.7
------- -------
Net cash used by investing activities (41.8) (63.5)
------- -------
Cash Flows from Financing Activities
Dividends to stockholders (9.4) (9.1)
Proceeds from issuance of stock 19.1 12.4
Notes payable reductions, net (19.8) (24.7)
Long-term debt borrowings - 21.0
Long-term debt reductions (45.9) (8.1)
------- -------
Net cash used by financing activities (56.0) (8.5)
------- -------
Effect of exchange rates on cash and equivalents (2.9) (0.1)
------- -------
Decrease in cash and equivalents (12.5) (11.7)
Cash and equivalents - beginning of period 34.4 24.7
------- -------
Cash and equivalents - end of period $ 21.9 $ 13.0
======= =======
Supplemental Disclosures of Cash Flow Information
Cash paid during the period for:
Interest $ 34.7 $ 36.6
Income taxes $ 10.2 $ 9.6
Non-cash Investing and Financing Activities:
Purchase of equipment under capital lease $ 2.7 $ 0.6
Receivable from sale of certain clinical
chemistry assets $ 1.6 $ -
</TABLE>
See accompanying notes to condensed consolidated financial
statements.
<PAGE>
BECKMAN COULTER, INC.
Notes To Condensed Consolidated Financial Statements
June 30, 2000
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 period data to
conform to the current year 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, 1999.
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. Comprehensive Income
-------------------------
Statement of Financial Accounting Standards No. 130,
"Reporting Comprehensive Income", establishes standards for
the reporting and display of comprehensive income. Components
of comprehensive income include net earnings and foreign
currency translation adjustments. The components of
comprehensive income are as follows (in millions):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net earnings $ 32.4 $ 25.9 $ 53.4 $ 42.9
Foreign currency
translation adjustment (14.8) (0.7) (26.1) (12.0)
------ ------ ------ ------
Comprehensive income $ 17.6 $ 25.2 $ 27.3 $ 30.9
====== ====== ====== ======
</TABLE>
3. Earnings Per Share
-----------------------
Statement of Financial Accounting Standards No. 128, "Earnings
Per Share", establishes standards for computing and presenting
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,
2000 1999
----------------------------------------------------
Per Per
Net Share Net Share
Earnings Shares Amount Earnings Shares Amount
-------- ------ ------ -------- ------ ------
<S> <C> <C> <C> <C> <C> <C>
Basic EPS:
Net earnings $ 32.4 29.4 $ 1.10 $ 25.9 28.6 $ 0.91
Effect of
dilutive
stock options - 1.4 (0.05) - 1.0 (0.04)
------ ---- ------ ------ ---- ------
Diluted EPS:
Net earnings $ 32.4 30.8 $ 1.05 $ 25.9 29.6 $ 0.87
====== ==== ====== ====== ==== ======
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended June 30,
2000 1999
----------------------------------------------------
Per Per
Net Share Net Share
Earnings Shares Amount Earnings Shares Amount
-------- ------ ------ -------- ------ ------
<S> <C> <C> <C> <C> <C> <C>
Basic EPS:
Net earnings $ 53.4 29.2 $ 1.83 $ 42.9 28.5 $ 1.51
Effect of
dilutive
stock options - 1.3 (0.08) - 1.1 (0.06)
------ ---- ------ ------ ---- ------
Diluted EPS:
Net earnings $ 53.4 30.5 $ 1.75 $ 42.9 29.6 $ 1.45
====== ==== ====== ====== ==== ======
</TABLE>
4. Sale of Receivables
------------------------
During the six months ended June 30, 2000, we sold certain
financial assets (primarily consisting of sales-type lease
receivables) as part of our plan to reduce debt. The net book
value of financial assets sold was $48.3 million for which we
received $48.3 million in cash proceeds. During the six
months ended June 30, 1999, we sold similar assets with a net
book value of $26.8 million for cash proceeds of $27.4
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 limited recourse provisions.
5. Inventories
----------------
Inventories consisted of the following (in millions):
<TABLE>
<CAPTION>
June 30, 2000 December 31, 1999
------------- -----------------
<S> <C> <C>
Finished products $ 227.9 $ 210.9
Raw materials, parts and
assemblies 101.6 87.2
Work in process 19.9 15.0
------- -------
$ 349.4 $ 313.1
======= =======
</TABLE>
6. Goodwill
-------------
During the quarter ended June 30, 2000, we recorded a $6.3 million increase
to goodwill. The increase was the result of adjustments to deferred income
taxes related to the 1997 acquisition of Coulter Corporation offset by a
reversal of excess purchase liabilities.
7. Provision for Restructuring Operations
-------------------------------------------
We recorded a restructuring charge of $4.3 million, $2.6 million after
taxes, in the fourth quarter of 1999 for consolidation of selling, general,
administrative and technical functions. The following table details the
activity within the accrual for the six months ended June 30, 2000 (in
millions):
<TABLE>
<CAPTION>
Facility
Consolidation
and
Personnel Asset-
and related
Other Write-offs Total
----- ---------- -----
<S> <C> <C> <C>
Remaining provision included
in accrued expenses at
December 31, 1999 $ 3.0 $ 0.6 $ 3.6
2000 year-to-date utilization (1.4) (0.1) (1.5)
----- ----- -----
Balance at June 30, 2000 $ 1.6 $ 0.5 $ 2.1
===== ===== =====
</TABLE>
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 accrual for
the six months ended June 30, 2000 (in millions):
<TABLE>
<CAPTION>
Facility
Consolidation
and
Personnel Asset-
and related
Other Write-offs Total
----- ---------- -----
<S> <C> <C> <C>
Balance at December 31, 1999:
Consolidation of selling,
general, administrative and
technical functions $ 8.3 $ - $ 8.3
Changes in manufacturing
operations 1.1 4.5 5.6
----- ----- -----
Remaining provision included in
accrued expenses at
December 31, 1999 $ 9.4 $ 4.5 $13.9
===== ===== =====
2000 year-to-date utilization:
Consolidation of selling,
general, administrative
and technical functions $(4.3) $ - $(4.3)
Changes in manufacturing
operations (0.6) (3.8) (4.4)
----- ----- -----
Total 2000 year-to-date
utilization $(4.9) $(3.8) $(8.7)
===== ===== =====
Balance at June 30, 2000:
Consolidation of selling,
general, administrative and
technical functions $ 4.0 $ - $ 4.0
Changes in manufacturing
operations 0.5 0.7 1.2
----- ----- -----
Balance at June 30, 2000 $ 4.5 $ 0.7 $ 5.2
===== ===== =====
</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 within the accrual for
the six months ended June 30, 2000 (in millions):
<TABLE>
<CAPTION>
Facility
Consolidation
and
Personnel Asset-
and related
Other Write-offs Total
----- ---------- -----
<S> <C> <C> <C>
Balance at December 31, 1999:
Consolidation of selling,
general, administrative and
technical functions $ 1.7 $ 1.7 $ 3.4
Changes in manufacturing
operations 1.6 - 1.6
----- ----- -----
Remaining provision included in
accrued expenses at
December 31, 1999 $ 3.3 $ 1.7 $ 5.0
===== ===== =====
2000 year-to-date utilization:
Consolidation of selling,
general, administrative and
technical functions $(1.6) $(0.8) $(2.4)
Changes in manufacturing
operations (1.5) - (1.5)
----- ----- -----
Total 2000 year-to-date
utilization $(3.1) $(0.8) $(3.9)
===== ===== =====
Balance at June 30, 2000:
Consolidation of selling,
general, administrative and
technical functions $ 0.1 $ 0.9 $ 1.0
Changes in manufacturing
operations 0.1 - 0.1
----- ----- -----
Balance at June 30, 2000 $ 0.2 $ 0.9 $ 1.1
===== ===== =====
</TABLE>
8. Contingencies
------------------
In December 1999, Streck Laboratories, Inc. ("Streck") served
Beckman Coulter and Coulter Corporation with a complaint filed
in the United States District Court for the District of
Nebraska. The complaint alleges that control products sold by
Beckman Coulter and/or Coulter Corporation infringe each of
five patents owned by Streck, and seeks injunctive relief,
damages, attorney fees and costs. We, on behalf of ourselves
and on behalf of Coulter Corporation, have answered the
complaint and have filed a counterclaim against Streck for
patent infringement. We continue to believe that there is no
reasonable basis for us to conclude that this litigation could
lead to an outcome that would have a material adverse effect
on our consolidated operations or financial position.
In addition to the above matter, we are involved in a number
of other 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 consolidated operations or
financial position.
9. Business Segment Information
---------------------------------
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.
In the first quarter of 2000, we realigned our geographic
reporting structure. Our Latin America operations, which were
formerly reported with the "Asia and Rest of World" geographic
area, are now reported in the "Americas" geographic area along
with our North America operations. Prior year amounts have
been reclassified to conform to the current year presentation.
<TABLE>
<CAPTION>
(in millions) For the quarters ended For the six months ended
June 30, June 30,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales
Clinical
diagnostics $ 367.0 $ 353.3 $ 720.1 $ 679.9
Life science
research 102.4 92.9 183.7 171.4
Center - - - -
------- ------- ------- -------
Consolidated $ 469.4 $ 446.2 $ 903.8 $ 851.3
======= ======= ======= =======
Operating income (loss)
Clinical
diagnostics $ 63.8 $ 53.1 $ 120.9 $ 108.0
Life science
research 15.8 10.5 22.8 16.8
Center (19.2) (9.5) (36.5) (27.4)
------- ------- ------- -------
Consolidated $ 60.4 $ 54.1 $ 107.2 $ 97.4
======= ======= ======= =======
Interest income
Clinical
diagnostics $ - $ (0.5) $ (0.7) $ (1.5)
Life science
research - - - -
Center (2.1) (1.3) (2.8) (2.3)
------- ------- ------- -------
Consolidated $ (2.1) $ (1.8) $ (3.5) $ (3.8)
======= ======= ======= =======
Interest expense
Clinical
diagnostics $ - $ - $ - $ -
Life science
research - - - -
Center 17.9 18.9 36.5 37.1
------- ------- ------- -------
Consolidated $ 17.9 $ 18.9 $ 36.5 $ 37.1
======= ======= ======= =======
Sales to external
customers
Americas $ 286.1 $ 260.2 $ 548.5 $ 498.3
Europe 121.9 133.7 244.4 254.4
Asia 61.4 52.3 110.9 98.6
------- ------- ------- -------
Consolidated $ 469.4 $ 446.2 $ 903.8 $ 851.3
======= ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
June 30, 2000 December 31, 1999
------------- ----------------
<S> <C> <C>
Long-lived assets
Americas $ 958.7 $ 981.2
Europe 88.7 111.4
Asia 38.3 51.8
-------- --------
Consolidated $1,085.7 $1,144.4
======== ========
Total assets
Clinical diagnostics $1,362.2 $1,460.8
Life science research 189.9 178.4
Center 457.9 471.6
-------- --------
Consolidated $2,010.0 $2,110.8
======== ========
</TABLE>
10. Stockholders' Equity
--------------------------
On April 6, 2000, our stockholders approved an amendment to the
Certificate of Incorporation to increase the authorized shares of
common stock from 75,000,000 to 150,000,000.
11. Recent Accounting Developments
------------------------------------
In December 1999, the SEC issued Staff Accounting Bulletin No. 101
("SAB 101"). SAB 101 provides the SEC's views in applying generally
accepted accounting principles to selected revenue recognition
issues. As amended, calendar year-end companies that have not
applied the accounting requirements of SAB 101 may report a
change in accounting principle no later than December 31,
2000, including retroactive restatement of all affected
quarters within 2000. We are currently evaluating the impact
of SAB 101 on our consolidated financial statements and
results of operations.
12. 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 Parent, 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
June 30, 2000
<S> <C> <C> <C> <C> <C>
Assets:
Cash and
equivalents $ (38.2) $ (2.5) $ 62.6 $ - $ 21.9
Trade and other
receivables 232.2 4.8 262.8 - 499.8
Inventories 240.4 37.8 117.3 (46.1) 349.4
Other current
assets 591.3 898.9 78.7 (1,515.7) 53.2
-------- -------- -------- --------- --------
Total current
assets 1,025.7 939.0 521.4 (1,561.8) 924.3
Property, plant and
equipment, net 157.8 82.8 113.8 (71.5) 282.9
Goodwill, net 12.6 324.3 8.6 - 345.5
Other intangibles,
net 28.9 358.2 3.1 - 390.2
Other assets 1,341.9 30.1 226.3 (1,531.2) 67.1
-------- -------- -------- --------- --------
Total assets $2,566.9 $1,734.4 $ 873.2 $(3,164.5) $2,010.0
======== ======== ======== ========= ========
Liabilities:
Notes payable and
current
maturities
of long-term
debt $ 3.8 $ 0.5 $ 24.3 $ - $ 28.6
Accounts payable
and accrued
expenses 275.6 30.0 73.4 - 379.0
Other current
liabilities 656.0 370.1 109.9 (1,070.5) 65.5
-------- -------- -------- --------- --------
Total current
liabilities 935.4 400.6 207.6 (1,070.5) 473.1
Long-term debt,
less current
maturities 876.4 0.1 58.9 - 935.4
Other liabilities 491.4 662.7 134.7 (952.2) 336.6
-------- -------- -------- --------- --------
Total
liabilities 2,303.2 1,063.4 401.2 (2,022.7) 1,745.1
Total stockholders'
equity 263.7 671.0 472.0 (1,141.8) 264.9
-------- -------- -------- --------- --------
Total
liabilities
and stockholders'
equity $ 2,566.9 $1,734.4 $ 873.2 $(3,164.5) $2,010.0
========= ======== ======== ========= ========
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Elimina- Consoi-
Parent diaries diaries tions dated
------ ------- ------- ----- -----
Condensed Consolidated
Balance Sheet
December 31, 1999
<S> <C> <C> <C> <C> <C>
Assets:
Cash and equivalents $ (5.3) $ 3.7 $ 36.0 $ - $ 34.4
Trade and other
receivables 255.8 6.0 304.6 - 566.4
Inventories 201.0 32.1 122.7 (42.7) 313.1
Other current assets 455.4 725.7 95.4 (1,224.0) 52.5
-------- -------- -------- -------- --------
Total current
assets 906.9 767.5 558.7 (1,266.7) 966.4
Property, plant and
equipment, net 152.4 84.6 142.3 (73.4) 305.9
Goodwill, net 10.3 325.6 8.8 - 344.7
Other intangibles,
net 30.2 366.2 3.5 - 399.9
Other assets 1,457.9 35.8 279.2 (1,679.0) 93.9
-------- -------- -------- --------- --------
Total assets $2,557.7 $1,579.7 $ 992.5 $(3,019.1) $2,110.8
======== ======== ======== ========= ========
Liabilities:
Notes payable and
current maturities
of long-term debt $ 4.4 $ 1.1 $ 44.5 $ - $ 50.0
Accounts payable
and accrued
expenses 368.3 32.7 95.6 (22.5) 474.1
Other current
liabilities 530.9 213.1 131.0 (823.2) 51.8
-------- -------- -------- --------- -------
Total current
liabilities 903.6 246.9 271.1 (845.7) 575.9
Long-term debt, less
current maturities 913.0 0.1 67.6 - 980.7
Other liabilities 513.2 647.9 213.0 (1,047.8) 326.3
-------- -------- -------- --------- -------
Total
liabilities 2,329.8 894.9 551.7 (1,893.5) 1,882.9
Total stockholders'
equity 227.9 684.8 440.8 (1,125.6) 227.9
-------- -------- -------- --------- --------
Total
liabilities
and
stockholders'
equity $2,557.7 $1,579.7 $ 992.5 $ (3,019.1) $2,110.8
======== ======== ======== ========= ========
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Elimina- Consoli-
Parent diaries diaries tions dated
------ ------- ------- ----- -----
Condensed Consolidated
Statement of Operations
Three Months Ended
June 30, 2000
<S> <C> <C> <C> <C> <C>
Sales $349.8 $ 84.0 $ 255.1 $(219.5) $469.4
Operating costs and
expenses:
Cost of sales 225.3 57.9 181.7 (219.1) 245.8
Selling, general
and
administrative 65.3 10.2 41.9 - 117.4
Research and
development 25.8 18.4 1.6 - 45.8
------ ------ ------ ------ ------
Operating income
(loss) 33.4 (2.5) 29.9 (0.4) 60.4
Nonoperating (income)
and
expenses (6.0) 3.3 (1.5) 17.6 13.4
------ ------ ------ ------ ------
Earnings (loss) before
income taxes 39.4 (5.8) 31.4 (18.0) 47.0
Income taxes (benefit) 6.8 (0.5) 8.5 (0.2) 14.6
------ ------ ------ ------ ------
Net earnings
(loss) $ 32.6 $ (5.3) $ 22.9 $(17.8) $ 32.4
====== ====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Elimina- Consoli-
Parent diaries diaries tions dated
------ ------- ------- ----- -----
<S> <C> <C> <C> <C> <C>
Condensed Consolidated
Statement of Operations
Three Months Ended
June 30, 1999
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)
and
expenses (33.9) 1.4 (1.3) 49.8 16.0
------ ------ ------ ------ ------
Earnings before income
taxes 38.4 12.9 32.8 (46.0) 38.1
Income taxes 19.9 3.2 17.3 (28.2) 12.2
------ ------ ------ ------ ------
Net earnings $ 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
Six Months Ended
June 30, 2000
<S> <C> <C> <C> <C> <C>
Sales $680.1 $159.7 $477.8 $(413.8) $903.8
Operating costs and
expenses:
Cost of sales 427.9 113.8 351.2 (415.6) 477.3
Selling, general
and
administrative 126.6 22.8 83.2 - 232.6
Research and
development 50.0 33.8 2.9 - 86.7
------ ------ ------ ------ ------
Operating
income
(loss) 75.6 (10.7) 40.5 1.8 107.2
Nonoperating (income)
and expenses 7.8 6.7 (2.2) 17.5 29.8
------ ------ ------ ------ ------
Earnings (loss) before
income taxes 67.8 (17.4) 42.7 (15.7) 77.4
Income taxes (benefit) 15.6 (3.6) 11.5 0.5 24.0
------ ------ ------ ------ ------
Net earnings
(loss) $ 52.2 $(13.8) $ 31.2 $(16.2) $ 53.4
</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
Nonoperating (income)
and expenses (5.4) (1.1) (0.2) 41.0 34.3
------ ------ ------ ------- ------
Earnings before income
taxes 34.5 20.3 49.3 (41.0) 63.1
Income taxes 17.9 4.3 24.4 (26.4) 20.2
------ ------ ------ ------- ------
Net earnings $ 16.6 $ 16.0 $ 24.9 $ (14.6) $ 42.9
====== ====== ====== ======= ======
</TABLE>
<TABLE>
<CAPTION>
Non-
Guarantor Guarantor
Subsi- Subsi- Consoli-
Parent diaries diaries dated
------ ------- ------- -----
Condensed Consolidated
Statement of Cash Flows
Six Months Ended June 30, 2000
<S> <C> <C> <C> <C>
Net cash (used) provided by
operating activities $ 11.4 $ (7.6) $ 84.4 $ 88.2
------- ------- ------- -------
Cash flows from investing
activities:
Additions to property, plant and
equipment (35.2) (4.1) (32.7) (72.0)
Proceeds from sale of certain
clinical chemistry assets - - 15.0 15.0
Proceeds from sale of property,
plant and equipment - 2.3 12.9 15.2
------- ------- ------- -------
Net cash used
by investing activities (35.2) (1.8) (4.8) (41.8)
------- ------- ------- -------
Cash flows from financing
activities:
Dividends to stockholders (9.4) - - (9.4)
Proceeds from issuance of stock 19.1 - - 19.1
Notes payable reductions - (0.5) (19.3) (19.8)
Net intercompany (reductions)
borrowings 16.6 3.7 (20.3) -
Long-term debt reductions (35.4) - (10.5) (45.9)
------- ------- ------- -------
Net cash provided (used)
by financing activities (9.1) 3.2 (50.1) (56.0)
------- -------- ------- -------
Effect of exchange rates on cash
and equivalents - - (2.9) (2.9)
------- -------- ------- -------
(Decrease) increase in cash and
equivalents (32.9) (6.2) 26.6 (12.5)
Cash and equivalents - beginning of
period ( 5.3) 3.7 36.0 34.4
------- ------- ------- -------
Cash and equivalents - end of
period $ (38.2) $ (2.5) $ 62.6 $ 21.9
======= ======= ======= =======
</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
by operating activities $ 1.8 $(28.4) $ 87.0 $ 60.4
------ ------ ------ ------
Cash flows from investing
activities:
Additions to property, plant
and equipment (29.2) (2.5) (34.5) (66.2)
Proceeds from sale 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 stockholders (9.1) - - (9.1)
Proceeds from issuance of stock 12.4 - - 12.4
Notes payable (reductions)
borrowings 16.4 - (41.1) (24.7)
Net intercompany (reductions)
borrowings (26.8) 30.1 (3.3) -
Long-term debt borrowings
(reductions), net ( 5.1) - 18.0 12.9
------ ------ ------ ------
Net cash (used) provided by
financing activities (12.2) 30.1 (26.4) (8.5)
------ ------ ------ ------
Effect of exchange rates on cash
and equivalents - - (0.1) (0.1)
------ ------ ------ ------
(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>
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Overview
--------
Beckman Coulter, Inc. is a world leader in providing systems
that simplify and automate laboratory processes used in all
phases of the battle against disease. We design, manufacture,
market and service a broad range of laboratory systems
consisting of instruments, chemistries, software, and supplies
that meet a variety of laboratory needs. Our products are used
in a range of applications, from instruments used for
pioneering medical research and drug discovery to diagnostic
tools found in hospitals and physicians' offices. We compete
in market segments that total approximately $28 billion in
annual sales worldwide.
Our diagnostics product lines cover virtually all blood tests
routinely performed in hospital laboratories. For medical and
pharmaceutical research, we provide a wide range of systems
used in genomic, cellular and proteomic testing. We have
approximately 125,000 systems operating in laboratories around
the world, with 68% of annual revenues coming from after-
market customer purchases of operating supplies, chemistry
kits, and service. We market our products in approximately
130 countries, generating nearly 45% of revenues outside the
United States.
Results of Operations
---------------------
Sales in the second quarter of 2000 were $469.4 million, an
increase of 5.2% (6.7% excluding the effect of foreign
currency rate changes) compared to the same period in the
prior year. Clinical diagnostics sales were $367.0 million
and life science research sales were $102.4 million, an
increase of 3.9% and 10.2%, respectively, compared to the same
period in 1999. Sales in the Americas and Asia geographic
areas increased 10.0% and 17.4%, respectively, while sales in
the Europe geographic area decreased 8.8% during the quarter
compared to the same period in the prior year. On a constant
currency basis, sales in the second quarter in Europe
decreased 1.7% while sales in Asia increased 11.8% compared to
the same period in the prior year.
Sales growth for the second quarter resulted from the
following:
- the clinical diagnostics segment was led by record
placements of Synchron LX(R) 20's for clinical chemistry analysis
and Power Processors for sample preparation.
Immunodiagnostics sales growth was led by Access(R) unit
placements in the Americas while our Hematology product area
declined when compared with a particularly strong quarter in
1999.
- the life science research segment was led by our robotic
automation/genetic analysis products, including placements of
CEQ(TM) 2000 DNA analysis systems, Sagian(TM) Core systems and our
Biomek(R) 2000 and new Biomek(R) FX liquid handling systems.
- Europe was dampened due to currency and the continued
effects of reimbursement changes, particularly in Germany and
Italy.
- Asia increased due to a strengthening economy.
Sales in the first half of 2000 grew 6.2% (7.9% excluding the
effect of foreign currency rate changes) compared to the first
half of 1999 due to factors mentioned previously and a one-
time $16.6 million sale of clinical chemistry assets in Spain
in the quarter ended March 31, 2000. For the quarter ended
March 31, 1999, the sales generated from the clinical
chemistry operations in Spain were $5.4 million.
Gross profit as a percentage of sales in the second quarter of
2000 was 47.6%, 0.1 percentage point higher than the same
period in the prior year. Gross profit as a percentage of
sales in the first half of 2000 was 47.2%, 0.5 percentage
points lower than the same period in the prior year. The
decline in gross profit percentage is primarily due to the one-
time $16.6 million sale of clinical chemistry assets in Spain
which contributed a lower gross margin than historical
company levels. Excluding this one-time transaction, gross
profit would have been 47.8% for the first half of 2000.
Selling, general and administrative expenses ("SG&A") declined
as a percentage of sales both in the three and six-month
periods ended June 30, 2000 as compared to the same periods in
the prior year. For the quarter ended June 30, 2000, SG&A was
$117.4 million or 25.0% of sales, as compared to $115.5
million or 25.9% of sales in the same period in the prior
year. For the six months ended June 30, 2000, SG&A was $232.6
million or 25.7% of sales, as compared to $227.3 million or
26.7% of sales in the same period in the prior year. The
improvement in SG&A as a percentage of sales is due to further
synergies from the Coulter integration.
Interest expense declined both in the three and six-month
periods ended June 30, 2000 as compared to the same periods in
the prior year due primarily to debt reduction. During the
second quarter of 2000, we sold a facility in Japan which
resulted in proceeds of $12.0 million and a pretax gain of
$1.7 million, or $1.2 million after tax. This gain is
included in "other nonoperating (income) and expenses" on the
accompanying condensed consolidated statement of operations.
Net earnings for the second quarter of 2000 were $32.4 million
or $1.05 per diluted share compared to $25.9 million or $0.87
per diluted share in 1999. For the first half of 2000, net
earnings were $53.4 million or $1.75 per diluted share compared
to $42.9 million or $1.45 per diluted share. The increase in
net earnings is primarily due to the various reasons discussed
previously.
Financial Condition
-------------------
As discussed in greater detail in our 1999 annual report,
Beckman Coulter is a highly leveraged company. Although the
debt-to-capital ratio has declined from 81.9% at December 31,
1999 to 78.4% at June 30, 2000, 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, 2000,
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 2000 and
beyond, including sales of certain financial assets (primarily
consisting of sales-type lease receivables) and real estate
assets.
Operating activities provided net cash of $88.2 million in
the first six months of 2000 compared to net cash provided of
$60.4 million in the first six months of the prior year. The
primary contributors were:
- net earnings were $53.4 million in 2000 compared to $42.9
million in 1999;
- proceeds from the sale of sales-type lease receivables
were $48.3 million in 2000 compared to $27.4 million in
1999;
- reductions in trade and other receivables contributed
$21.4 million in cash compared to $14.6 million cash usage in
1999.
These improvements were partially offset by:
- increases in inventories used $39.3 million in 2000
compared to $16.9 million used in 1999;
- cash paid to settle accounts payable, accrued expenses
and other liabilities was $90.0 million in 2000 compared to
$73.0 million in 1999.
In 2000, investing activities used $41.8 million of net cash
consisting of $72.0 million of net capital purchases, offset
by $15.0 million and $15.2 million in proceeds from the sale
of clinical chemistry assets in Spain and sale of property,
plant and equipment, respectively. In 1999, investing
activities used $63.5 million of net cash, primarily for
capital purchases.
Net cash used by financing activities was $56.0 million and
$8.5 million for the first half of the period in 2000 and 1999,
respectively. During the first six months of 2000, we made
$65.7 million in cash payments towards reducing our debt
compared to net debt payments of $11.8 million, during the
same period in the prior year.
In addition to the decline in our debt-to-capital ratio
mentioned previously, the ratio of current assets to current
liabilities ("current ratio") improved to 2.0 at June 30, 2000
from 1.7 at December 31, 1999. The decrease in current assets
was primarily due to reductions in cash as a result of debt
reduction payments and the decrease in trade and other
receivables offset by an increase in net inventories. The
decrease in current liabilities was due to cash payments to
settle accounts payable, accrued expenses and other
liabilities offset by an increase in income taxes payable.
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 1, 2000, we paid a quarterly cash dividend of $0.16
per share of common stock, for a total of $4.7 million.
Business Climate
----------------
The clinical diagnostics and life science research markets are
highly competitive and we encounter significant competition in
each market from many manufacturers, both domestic and outside
the United States. These markets continue to be unfavorably
impacted by the economic weakness in parts of Europe and Japan
and government and healthcare cost containment initiatives in
general. The life science research market also continues to
be affected by consolidations of pharmaceutical companies and
governmental constraints on research and development spending,
especially outside the United States.
In the clinical diagnostics market, attempts to lower costs
and to increase productivity have led to further consolidation
among healthcare providers in the United States, resulting in
more powerful provider groups that continue to leverage their
purchasing power to contain costs. Preferred supplier
arrangements and combined purchases are becoming more
commonplace. Consequently, it has become essential for
manufacturers to provide cost-effective diagnostic systems to
remain competitive. Cost containment initiatives in the United
States and in the European healthcare systems will continue to
be factors which may affect our ability to maintain or
increase sales. Future profitability may also be adversely
affected if the relative value of the U.S. dollar strengthens
against certain currencies.
The continuing consolidation trend among United States
healthcare providers, mentioned previously, has increased
pressure on diagnostic equipment manufacturers to broaden
their product offerings to encompass a wider range of testing
capability, greater automation and higher volume capacity at a
lower cost. With our current product offerings, we believe Beckman
Coulter is well suited to provide a broad range of systems
with automation capabilities that speed test results, lower
labor costs, and improve the overall efficiency of
laboratories.
Our new products originate from four sources:
- internal research and development programs;
- external collaborative efforts with individuals in
academic institutions and technology companies;
- devices and techniques that are generated in customers'
laboratories; and
- business and technology acquisitions.
The following new product shipments and strategic
collaborations were significant in the second quarter:
- The Biomek (R) FX laboratory automation workstation began
shipping for use in nucleic acid preparation, microtiter plate
replication and high-throughput drug screening in genomic and
pharmaceutical research. This system is a quantum leap
forward in liquid handling instrumentation, performing the
work of three or more independent liquid handlers.
- CEQ(TM) 2000XL DNA analysis system was introduced and
shipped to individual researchers mapping and investigating
specific segments of the genetic code. This next-generation
system provides longer reads and faster run times for DNA
sequencing.
- A distribution and collaboration agreement was signed with
Cellomics, Inc. to offer customers high-content cell screening
technologies paired with Beckman Coulter's automated drug
discovery systems. This alliance positions the two companies
at the forefront of cell-based drug discovery applications.
- A development agreement with Micronics, Inc. was signed
to collaborate on a CLIA-waived, "lab-on-a-chip" based
hematology system for the point-of-care market.
The size and growth of our markets are influenced by a number
of factors, including:
- technological innovation in bio-analytical practice;
- government funding for basic and disease-related research
(for example, heart disease, AIDS and cancer);
- research and development spending by biotechnology and
pharmaceutical companies;
- healthcare spending; and
- physician practice.
We expect worldwide healthcare expenditures and diagnostic
testing to increase over the long-term, primarily as a result
of the following:
- growing demand for services generated by the increasing
size and aging of the world population;
- increasing expenditures on diseases requiring costly
treatment (for example, AIDS and cancer); and
- expanding demand for improved healthcare services in
developing countries.
In addition to the business climate factors discussed
previously, certain economic factors may influence our
business, including:
- currency fluctuations - as nearly 45% of our revenues are
generated outside the United States; and
- interest rates - as approximately 35% of our debt is
under variable interest rate terms.
With our leadership position in cellular analysis and our
extensive capabilities in routine chemistry and
immunodiagnoistics, we are able to offer a broad range of
automated systems that together can perform more than 75% of a
hospital laboratory's test volume and essentially all of the
tests that are considered routine. We believe we are able to
provide significant value-added benefits, enhanced through our
expertise in simplifying and automating laboratory processes,
to our customers.
Recent Accounting Pronouncements
--------------------------------
In December 1999, the Securities and Exchange Commission
("SEC") issued Staff Accounting Bulletin No. 101 ("SAB 101").
SAB 101 provides the SEC's views in applying generally
accepted accounting principles to selected revenue recognition
issues. As amended, calendar year-end companies that have not
applied the accounting requirements of SAB 101 may report a
change in accounting principle no later than December 31,
2000, including retroactive restatement of all affected
quarters within 2000. We are currently evaluating the impact
of SAB 101 on our consolidated financial statements and
results of operations.
Forward Looking Statements
--------------------------
This Form 10-Q contains forward-looking statements, including
statements regarding, among other items:
- our business strategy;
- anticipated trends in our business; and
- our liquidity requirements and capital resources.
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:
- complexity and uncertainty regarding development of new
high-technology products;
- loss of market share through aggressive competition in
the clinical diagnostics and life science research
markets;
- our dependence on capital spending policies and
government funding;
- the effect of potential healthcare reforms;
- fluctuations in foreign exchange rates and interest
rates;
- reliance on patents and other intellectual property;
- unanticipated reductions in cash flows and difficulty in
sales of assets;
- future effective tax rate;
- unanticipated euro problems; and
- 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.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The Company's cash flow and earnings are subject to
fluctuations due to changes in foreign currency exchange rates
and interest rates. The Company attempts to limit its
exposure to these market risks through the use of various
financial instruments. Assuming a hypothetical 10%
strengthening and 10% weakening of the spot exchange rates for
the U.S. dollar against the foreign currencies at June 30,
2000, a 10% strengthening of the U.S. dollar would result in a
gain in fair value of $20.6 million and a 10% weakening of the
U.S. dollar would result in a loss in fair value of $21.2
million in these instruments. With respect to interest rates,
a one percentage point increase or decrease in interest rates
would decrease or increase current year's pre-tax earnings by
$1.7 million. For further discussion of the Company's market
risk exposures, refer to the section entitled "Financial Risk
Management" included in "Management's Discussion and Analysis"
of the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1999.
<PAGE>
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
In December 1999, Streck Laboratories, Inc.
served Beckman Coulter and Coulter Corporation with a
complaint filed in the United States District Court
for the District of Nebraska. The complaint alleges
that control products sold by Beckman Coulter and/or
Coulter Corporation infringe each of five patents
owned by Streck, and seeks injunctive relief,
damages, attorney fees and costs. We, on behalf of
ourselves and on behalf of Coulter Corporation have
answered the complaint and have filed a counterclaim
against Streck for patent infringement. We continue
to believe that there is no reasonable basis for us
to conclude that this litigation could lead to an
outcome that would have a material adverse effect on
our consolidated operations or financial position.
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
10.1 Beckman Coulter, Inc. Savings Plan, Amendment 2000-1, dated
June 5, 2000
11. Statement re Computation of Per Share Earnings:
This information is set forth in Note 3, Earnings
Per Share of the Condensed Consolidated Financial
Statements included in Part I herein.
15. Independent Accountants' Review Report, July 27, 2000
27. Financial Data Schedule as of and for the six
month period ended June 30, 2000
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.
BECKMAN COULTER, INC.
(Registrant)
Date: August 11, 2000 by WILLIAM H. MAY
_____________________
William H. May
Vice President
General Counsel and Secretary
Date: August 11, 2000 by JAMES T. GLOVER
_____________________
James T. Glover
Vice President and
Treasurer
<PAGE>
EXHIBIT INDEX
FORM 10-Q, SECOND QUARTER, 2000
Exhibit
Number Description
------- -----------
10.1 Beckman Coulter, Inc. Savings Plan, Amendment 2000-1,
dated June 5, 2000.
11. Statement re Computation of Per Share Earnings: This
information is set forth in Note 3, Earnings Per Share,
of the Condensed Consolidated Financial Statements included
in Part I herein.
15. Independent Accountants' Review Report, July 27, 2000.
27. Financial Data Schedule as of and for the six month
period ended June 30, 2000.
