Thermo Fisher Scientific Inc. (NYSE: TMO), the world leader in serving
science, today reported its financial results for the fourth quarter and
full year ended December 31, 2013.
Fourth Quarter and Full Year 2013 Highlights
-
Grew full year adjusted earnings per share (EPS) by 10% to a record
$5.42, and fourth quarter adjusted EPS by 5% to a record $1.43.
-
Increased fourth quarter revenue by 6% to a record $3.47 billion.
-
Expanded adjusted operating margin in the fourth quarter by 40 basis
points to 20.0%.
-
Generated free cash flow of $1.75 billion for the full year.
-
Launched innovative new Thermo Scientific products during the year to
strengthen leading mass spectrometry, chromatography, specialty
diagnostics and biosciences offerings, highlighted by the breakthrough
Orbitrap Fusion Tribrid and new triple-quad platforms.
-
Achieved 20% growth in China for the year by leveraging investments to
expand R&D, manufacturing and commercial capabilities, and delivered
strong results in other high-growth markets, including Korea and
Brazil.
-
Returned more than $300 million of capital to shareholders through
stock buybacks and dividends.
-
Acquiring Life Technologies to add complementary genomics,
next-generation sequencing and forensic science capabilities for
customers in life sciences and applied markets, and to expand presence
in APAC and emerging markets.
Adjusted EPS, adjusted operating income, adjusted operating margin and
free cash flow are non-GAAP measures that exclude certain items detailed
later in this press release under the heading “Use of Non-GAAP Financial
Measures.”
“Our teams executed very well in the quarter to achieve outstanding
results on both the top and bottom line,” said Marc N. Casper, president
and chief executive officer of Thermo Fisher Scientific. “All three
business segments reported solid growth, and drove productivity to
deliver 40 basis points of adjusted operating margin expansion. Our
excellent operating performance throughout 2013 extended our track
record of delivering strong adjusted EPS growth, and led to a 10%
increase for the full year.
“These results demonstrate the success of our growth strategy and our
ability to further differentiate Thermo Fisher in the markets we serve.
We strengthened our innovation leadership by launching new products
across our portfolio for customers in research, bioproduction, specialty
diagnostics and applied markets. We also leveraged our scale and depth
of capabilities to help our customers in high-growth emerging markets
respond to the need for better air quality, safer food supplies and
growing demand for specialty diagnostics.
“Last, we look forward to completing our acquisition of Life
Technologies, which will enhance our unique customer value proposition
by broadening our product offering and adding another premier life
sciences brand. We’re excited about the new opportunities we will have
by combining our genomics, proteomics and specialty diagnostics
technologies to help our customers accelerate results and improve human
health.”
Fourth Quarter 2013
For the fourth quarter of 2013, adjusted EPS grew 5% to $1.43, versus
$1.36 in the fourth quarter of 2012. Revenue for the quarter grew 6% to
$3.47 billion in 2013, versus $3.26 billion in 2012. Organic revenue
growth was also 6% as the effects of acquisitions and currency
translation were immaterial. Adjusted operating income for the fourth
quarter of 2013 increased 9% compared with the year-ago period, and
adjusted operating margin expanded to 20.0%, compared with 19.6% in the
fourth quarter of 2012.
GAAP diluted EPS for the fourth quarter of 2013 was $0.92, versus $1.04
in the same quarter last year. The 2012 period included a favorable
impact related to a tax rate change in a foreign jurisdiction. GAAP
operating income for the fourth quarter of 2013 increased 14% to $455
million, compared with $401 million in 2012. GAAP operating margin
increased to 13.1%, compared with 12.3% in the fourth quarter of 2012.
Full Year 2013
For the full year 2013, adjusted EPS grew 10% to $5.42, versus $4.94 in
2012. Revenue for 2013 grew 5% to $13.09 billion, versus $12.51 billion
a year ago. Organic revenue grew 3%; acquisitions increased revenue by
2% and currency translation had a nominal impact. Adjusted operating
income for 2013 increased 7% compared with 2012, and adjusted operating
margin expanded to 19.5%, compared with 19.0% a year ago.
GAAP diluted EPS for 2013 was $3.48, versus $3.21 in 2012. GAAP
operating income for 2013 increased 9% to $1.61 billion, compared with
$1.48 billion a year ago. GAAP operating margin increased to 12.3%,
compared with 11.8% in 2012.
Annual Guidance for 2014
Casper added, “Our excellent performance in 2013 positions us well for
the year ahead. We look forward to successfully integrating Life
Technologies and fully leveraging our depth of capabilities to create
value for our customers and achieve our goals for growth in 2014.”
Thermo Fisher is initiating adjusted EPS and revenue guidance for the
full year 2014. The company expects to achieve adjusted EPS in the range
of $6.70 to $6.90 for 2014, which would result in 24% to 27% adjusted
EPS growth over 2013. The company expects to achieve 2014 revenue in the
range of $16.63 billion to $16.83 billion, for 27% to 29% revenue growth
year over year.
The company’s 2014 guidance includes the results of Life Technologies
from an assumed close date, and includes the results of the previously
announced divestitures through an assumed sale date. The guidance does
not include any other future acquisitions or divestitures and is based
on current foreign exchange rates. The adjusted EPS estimate excludes
amortization expense for acquisition-related intangible assets and
certain other items detailed later in this press release under the
heading “Use of Non-GAAP Financial Measures.”
Segment Results
Management uses adjusted operating results to monitor and evaluate
performance of the company’s three business segments, as highlighted
below.
Analytical Technologies Segment
In the fourth quarter of 2013, Analytical Technologies Segment revenue
increased 6% to $1.14 billion, compared with revenue of $1.08 billion in
the fourth quarter of 2012. Segment adjusted operating income increased
8% in the fourth quarter of 2013, and adjusted operating margin was
20.4%, versus 19.9% in the 2012 quarter.
For the full year 2013, Analytical Technologies Segment revenue
increased 3% to $4.13 billion, compared with revenue of $4.02 billion in
2012. Segment adjusted operating income increased 2% in 2013, and
adjusted operating margin was 18.6% in both periods.
Specialty Diagnostics Segment
Specialty Diagnostics Segment revenue in the fourth quarter increased 5%
to $833 million in 2013, compared with revenue of $792 million in the
fourth quarter of 2012. Segment adjusted operating income increased 9%
in the fourth quarter of 2013, and adjusted operating margin increased
to 26.9%, versus 25.9% in the 2012 quarter.
For the full year 2013, Specialty Diagnostics Segment revenue increased
8% to $3.19 billion, compared with revenue of $2.96 billion in 2012.
Segment adjusted operating income increased 14% in 2013, and adjusted
operating margin increased to 27.2%, versus 2012 results of 25.7%.
Laboratory Products and Services Segment
In the fourth quarter of 2013, Laboratory Products and Services Segment
revenue increased 8% to $1.64 billion, compared with revenue of $1.52
billion in the fourth quarter of 2012. Segment adjusted operating income
increased 9% in the fourth quarter of 2013, and adjusted operating
margin was 14.4%, versus 14.3% in the 2012 quarter.
For the full year 2013, Laboratory Products and Services Segment revenue
increased 5% to $6.35 billion, compared with revenue of $6.05 billion in
2012. Segment adjusted operating income increased 6% in 2013, and
adjusted operating margin was 14.5%, versus 14.4% in the 2012 quarter.
Use of Non-GAAP Financial Measures
In addition to the financial measures prepared in accordance with
generally accepted accounting principles (GAAP), we use certain non-GAAP
financial measures, including adjusted EPS, adjusted operating income
and adjusted operating margin, which exclude restructuring and other
costs/income and amortization of acquisition-related intangible assets.
Adjusted EPS also excludes certain other gains and losses, tax
provisions/benefits related to the previous items, benefits from tax
credit carryforwards, the impact of significant tax audits or events and
discontinued operations. We exclude the above items because they are
outside of our normal operations and/or, in certain cases, are difficult
to forecast accurately for future periods. We also use a non-GAAP
measure, free cash flow, which excludes operating cash flows from
discontinued operations and deducts net capital expenditures. We believe
that the use of non-GAAP measures helps investors to gain a better
understanding of our core operating results and future prospects,
consistent with how management measures and forecasts the company’s
performance, especially when comparing such results to previous periods
or forecasts.
For example:
We exclude costs and tax effects associated with restructuring
activities, such as reducing overhead and consolidating facilities. We
believe that the costs related to these restructuring activities are not
indicative of our normal operating costs.
We exclude certain acquisition-related costs, including charges for the
sale of inventories revalued at the date of acquisition and significant
transaction costs. We exclude these costs because we do not believe they
are indicative of our normal operating costs.
We exclude the expense and tax effects associated with the amortization
of acquisition-related intangible assets because a significant portion
of the purchase price for acquisitions may be allocated to intangible
assets that have lives of 5 to 20 years. Our adjusted EPS estimate for
2014 excludes approximately $2.25 of expense for the amortization of
acquisition-related intangible assets, including Life Technologies as of
an assumed close date. Exclusion of the amortization expense allows
comparisons of operating results that are consistent over time for both
our newly acquired and long-held businesses and with both acquisitive
and non-acquisitive peer companies.
We also exclude certain gains/losses and related tax effects, benefits
from tax credit carryforwards and the impact of significant tax audits
or events (such as the one-time effect on deferred tax balances of
enacted changes in tax rates), which are either isolated or cannot be
expected to occur again with any regularity or predictability and that
we believe are not indicative of our normal operating gains and losses.
For example, we exclude gains/losses from items such as the sale of a
business or real estate, gains or losses on significant
litigation-related matters, gains on curtailments of pension plans, the
early retirement of debt and discontinued operations.
We also report free cash flow, which is operating cash flow, net of
capital expenditures, and also excludes operating cash flows from
discontinued operations to provide a view of the continuing operations’
ability to generate cash for use in acquisitions and other investing and
financing activities.
Thermo Fisher’s management uses these non-GAAP measures, in addition to
GAAP financial measures, as the basis for measuring the company’s core
operating performance and comparing such performance to that of prior
periods and to the performance of our competitors. Such measures are
also used by management in their financial and operating decision-making
and for compensation purposes.
The non-GAAP financial measures of Thermo Fisher’s results of operations
and cash flows included in this press release are not meant to be
considered superior to or a substitute for Thermo Fisher’s results of
operations prepared in accordance with GAAP. Reconciliations of such
non-GAAP financial measures to the most directly comparable GAAP
financial measures are set forth in the accompanying tables. Thermo
Fisher’s earnings guidance, however, is only provided on an adjusted
basis. It is not feasible to provide GAAP EPS guidance because the items
excluded, other than the amortization expense, are difficult to predict
and estimate and are primarily dependent on future events, such as
acquisitions and decisions concerning the location and timing of
facility consolidations.
Conference Call
Thermo Fisher Scientific will hold its earnings conference call today,
January 30, 2014, at 8:00 a.m. Eastern time. To listen, dial (877)
312-9206 within the U.S. or (408) 774-4001 outside the U.S. You may also
listen to the call live on our website, www.thermofisher.com, by
clicking on “Investors.” You will find this press release, including the
accompanying reconciliation of non-GAAP financial measures and related
information, in that section of our website under “Financial Results.”
An audio archive of the call will be available under “Webcasts and
Presentations” through Friday, February 28, 2014.
About Thermo Fisher Scientific
Thermo Fisher Scientific Inc. (NYSE: TMO) is the world leader in serving
science. Our mission is to enable our customers to make the world
healthier, cleaner and safer. With revenue of $13 billion, we have
39,000 employees and serve customers within pharmaceutical and biotech
companies, hospitals and clinical diagnostic labs, universities,
research institutions and government agencies, as well as in
environmental and process control industries. We create value for our
key stakeholders through three premier brands, Thermo Scientific, Fisher
Scientific and Unity Lab Services, which offer a unique combination of
innovative technologies, convenient purchasing options and a single
solution for laboratory operations management. Our products and services
help our customers solve complex analytical challenges, improve patient
diagnostics and increase laboratory productivity. Visit
www.thermofisher.com.
The following constitutes a “Safe Harbor” statement under the Private
Securities Litigation Reform Act of 1995: This press release contains
forward-looking statements that involve a number of risks and
uncertainties. Important factors that could cause actual results to
differ materially from those indicated by forward-looking statements
include risks and uncertainties relating to: the need to develop new
products and adapt to significant technological change; implementation
of strategies for improving growth; general economic conditions
including economic conditions in the countries in which Thermo Fisher
and Life Technologies sell products, and related uncertainties;
dependence on customers' capital spending policies and government
funding policies; the effect of exchange rate fluctuations on
international operations; the effect of healthcare reform legislation;
use and protection of intellectual property; the effect of changes in
governmental regulations; and the effect of laws and regulations
governing government contracts, as well as the possibility that expected
benefits related to the transaction may not materialize as expected; the
transaction not being timely completed, if completed at all; prior to
the completion of the transaction, Life Technologies’ business
experiencing disruptions due to transaction-related uncertainty or other
factors making it more difficult to maintain relationships with
employees, licensees, other business partners or governmental entities;
difficulty retaining certain key employees; and the parties being unable
to successfully implement integration strategies or to achieve expected
synergies and operating efficiencies within the expected time-frames or
at all. Additional important factors that could cause actual results to
differ materially from those indicated by such forward-looking
statements are set forth in Thermo Fisher’s Quarterly Report on Form
10-Q for the quarter ended September 28, 2013, which is on file with
the SEC and available in the “Investors” section of Thermo Fisher’s
website under the heading “SEC Filings,” and in Life Technologies’
Quarterly Report on Form 10-Q for the quarter ended September 30, 2013,
which is on file with the SEC and available in the “Investor Relations”
section of Life Technologies’ website under the heading “SEC Filings.”
While we may elect to update forward-looking statements at some point in
the future, we specifically disclaim any obligation to do so, even if
estimates change and, therefore, you should not rely on these
forward-looking statements as representing our views as of any date
subsequent to today.
Consolidated Statement of Income (a)(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
December 31, 2013
|
|
% of Revenues
|
|
December 31, 2012
|
|
% of Revenues
|
(In millions except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
$
|
3,466.9
|
|
|
|
|
$
|
3,259.3
|
|
|
|
Costs and Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues (c)
|
|
|
|
|
|
1,931.0
|
|
|
55.7
|
%
|
|
|
1,815.6
|
|
|
55.7
|
%
|
Selling, general and administrative expenses (d)
|
|
|
|
|
|
764.0
|
|
|
22.0
|
%
|
|
|
720.1
|
|
|
22.1
|
%
|
Amortization of acquisition-related intangible assets
|
|
|
|
|
|
188.9
|
|
|
5.5
|
%
|
|
|
194.1
|
|
|
6.0
|
%
|
Research and development expenses
|
|
|
|
|
|
104.7
|
|
|
3.0
|
%
|
|
|
98.5
|
|
|
3.0
|
%
|
Restructuring and other costs, net (e)
|
|
|
|
|
|
23.3
|
|
|
0.7
|
%
|
|
|
30.4
|
|
|
0.9
|
%
|
|
|
|
|
|
|
|
3,011.9
|
|
|
86.9
|
%
|
|
|
2,858.7
|
|
|
87.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
|
|
|
|
455.0
|
|
|
13.1
|
%
|
|
|
400.6
|
|
|
12.3
|
%
|
Interest Income
|
|
|
|
|
|
6.6
|
|
|
|
|
|
6.2
|
|
|
|
Interest Expense
|
|
|
|
|
|
(69.0
|
)
|
|
|
|
|
(66.2
|
)
|
|
|
Other (Expense) Income, Net (f)
|
|
|
|
|
|
(15.0
|
)
|
|
|
|
|
2.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
|
|
|
|
|
377.6
|
|
|
|
|
|
343.5
|
|
|
|
(Provision for) Benefit from Income Taxes (g)
|
|
|
|
|
|
(34.6
|
)
|
|
|
|
|
42.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from Continuing Operations
|
|
|
|
|
|
343.0
|
|
|
|
|
|
385.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from Discontinued Operations, Net of Tax
|
|
|
|
|
|
-
|
|
|
|
|
|
(3.8
|
)
|
|
|
Loss on Disposal of Discontinued Operations, Net of Tax
|
|
|
|
|
|
(0.9
|
)
|
|
|
|
|
(5.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
|
|
|
$
|
342.1
|
|
|
9.9
|
%
|
|
$
|
376.4
|
|
|
11.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per Share from Continuing Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
$
|
.95
|
|
|
|
|
$
|
1.08
|
|
|
|
Diluted
|
|
|
|
|
$
|
.92
|
|
|
|
|
$
|
1.07
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
$
|
.95
|
|
|
|
|
$
|
1.05
|
|
|
|
Diluted
|
|
|
|
|
$
|
.92
|
|
|
|
|
$
|
1.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
361.8
|
|
|
|
|
|
358.4
|
|
|
|
Diluted
|
|
|
|
|
|
370.9
|
|
|
|
|
|
361.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Adjusted Operating Income and Adjusted
Operating Margin
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income (a)
|
|
|
|
|
$
|
455.0
|
|
|
13.1
|
%
|
|
$
|
400.6
|
|
|
12.3
|
%
|
Cost of Revenues Charges (c)
|
|
|
|
|
|
1.4
|
|
|
0.0
|
%
|
|
|
13.1
|
|
|
0.4
|
%
|
Selling, General and Administrative Costs (Income), Net (d)
|
|
|
|
|
|
25.6
|
|
|
0.7
|
%
|
|
|
(0.6
|
)
|
|
0.0
|
%
|
Restructuring and Other Costs, Net (e)
|
|
|
|
|
|
23.3
|
|
|
0.7
|
%
|
|
|
30.4
|
|
|
0.9
|
%
|
Amortization of Acquisition-related Intangible Assets
|
|
|
|
|
|
188.9
|
|
|
5.5
|
%
|
|
|
194.1
|
|
|
6.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Operating Income (b)
|
|
|
|
|
$
|
694.2
|
|
|
20.0
|
%
|
|
$
|
637.6
|
|
|
19.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Adjusted Net Income
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net Income (a)
|
|
|
|
|
$
|
342.1
|
|
|
9.9
|
%
|
|
$
|
376.4
|
|
|
11.5
|
%
|
Cost of Revenues Charges (c)
|
|
|
|
|
|
1.4
|
|
|
0.0
|
%
|
|
|
13.1
|
|
|
0.4
|
%
|
Selling, General and Administrative Costs (Income), Net (d)
|
|
|
|
|
|
25.6
|
|
|
0.7
|
%
|
|
|
(0.6
|
)
|
|
0.0
|
%
|
Restructuring and Other Costs, Net (e)
|
|
|
|
|
|
23.3
|
|
|
0.7
|
%
|
|
|
30.4
|
|
|
0.9
|
%
|
Amortization of Acquisition-related Intangible Assets
|
|
|
|
|
|
188.9
|
|
|
5.5
|
%
|
|
|
194.1
|
|
|
6.0
|
%
|
Amortization of Acquisition-related Intangible Assets – Equity
Investments
|
|
|
|
|
|
0.6
|
|
|
0.0
|
%
|
|
|
0.4
|
|
|
0.0
|
%
|
Other Expense, Net (f)
|
|
|
|
|
|
13.4
|
|
|
0.4
|
%
|
|
|
-
|
|
|
0.0
|
%
|
Provision for Income Taxes (g)
|
|
|
|
|
|
(65.9
|
)
|
|
-1.9
|
%
|
|
|
(130.4
|
)
|
|
-4.0
|
%
|
Discontinued Operations, Net of Tax
|
|
|
|
|
|
0.9
|
|
|
0.0
|
%
|
|
|
9.4
|
|
|
0.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income (b)
|
|
|
|
|
$
|
530.3
|
|
|
15.3
|
%
|
|
$
|
492.8
|
|
|
15.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Adjusted Earnings per Share
|
|
|
|
|
|
|
|
|
|
|
|
GAAP EPS (a)
|
|
|
|
|
$
|
0.92
|
|
|
|
|
$
|
1.04
|
|
|
|
Cost of Revenues Charges, Net of Tax (c)
|
|
|
|
|
|
-
|
|
|
|
|
|
0.02
|
|
|
|
Selling, General and Administrative Costs, Net of Tax (d)
|
|
|
|
|
|
0.06
|
|
|
|
|
|
-
|
|
|
|
Restructuring and Other Costs, Net of Tax (e)
|
|
|
|
|
|
0.05
|
|
|
|
|
|
0.05
|
|
|
|
Amortization of Acquisition-related Intangible Assets, Net of Tax
|
|
|
|
|
|
0.35
|
|
|
|
|
|
0.37
|
|
|
|
Amortization of Acquisition-related Intangible Assets, Net of Tax –
Equity Investments
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
Other Expense, Net of Tax (f)
|
|
|
|
|
|
0.02
|
|
|
|
|
|
-
|
|
|
|
Provision for Income Taxes (g)
|
|
|
|
|
|
0.03
|
|
|
|
|
|
(0.15
|
)
|
|
|
Discontinued Operations, Net of Tax
|
|
|
|
|
|
-
|
|
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EPS (b)
|
|
|
|
|
$
|
1.43
|
|
|
|
|
$
|
1.36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Free Cash Flow
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net Cash Provided by Operating Activities (a)
|
|
|
|
|
$
|
728.5
|
|
|
|
|
$
|
660.1
|
|
|
|
Net Cash Used in Discontinued Operations
|
|
|
|
|
|
1.6
|
|
|
|
|
|
7.2
|
|
|
|
Purchases of Property, Plant and Equipment
|
|
|
|
|
|
(94.5
|
)
|
|
|
|
|
(104.4
|
)
|
|
|
Proceeds from Sale of Property, Plant and Equipment
|
|
|
|
|
|
4.8
|
|
|
|
|
|
1.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow (h)
|
|
|
|
|
$
|
640.4
|
|
|
|
|
$
|
564.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Data
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
December 31, 2013
|
|
% of Revenues
|
|
December 31, 2012
|
|
% of Revenues
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
Analytical Technologies
|
|
|
|
|
$
|
1,144.2
|
|
|
33.0
|
%
|
|
$
|
1,079.0
|
|
|
33.1
|
%
|
Specialty Diagnostics
|
|
|
|
|
|
833.3
|
|
|
24.0
|
%
|
|
|
791.8
|
|
|
24.3
|
%
|
Laboratory Products and Services
|
|
|
|
|
|
1,640.9
|
|
|
47.3
|
%
|
|
|
1,516.6
|
|
|
46.5
|
%
|
Eliminations
|
|
|
|
|
|
(151.5
|
)
|
|
-4.3
|
%
|
|
|
(128.1
|
)
|
|
-3.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Revenues
|
|
|
|
|
$
|
3,466.9
|
|
|
100.0
|
%
|
|
$
|
3,259.3
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income and Operating Margin
|
|
|
|
|
|
|
|
|
|
|
|
Analytical Technologies
|
|
|
|
|
$
|
233.4
|
|
|
20.4
|
%
|
|
$
|
215.2
|
|
|
19.9
|
%
|
Specialty Diagnostics
|
|
|
|
|
|
224.4
|
|
|
26.9
|
%
|
|
|
205.0
|
|
|
25.9
|
%
|
Laboratory Products and Services
|
|
|
|
|
|
236.4
|
|
|
14.4
|
%
|
|
|
217.4
|
|
|
14.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal Reportable Segments
|
|
|
|
|
|
694.2
|
|
|
20.0
|
%
|
|
|
637.6
|
|
|
19.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues Charges (c)
|
|
|
|
|
|
(1.4
|
)
|
|
0.0
|
%
|
|
|
(13.1
|
)
|
|
-0.4
|
%
|
Selling, General and Administrative (Costs) Income, Net (d)
|
|
|
|
|
|
(25.6
|
)
|
|
-0.7
|
%
|
|
|
0.6
|
|
|
0.0
|
%
|
Restructuring and Other Costs, Net (e)
|
|
|
|
|
|
(23.3
|
)
|
|
-0.7
|
%
|
|
|
(30.4
|
)
|
|
-0.9
|
%
|
Amortization of Acquisition-related Intangible Assets
|
|
|
|
|
|
(188.9
|
)
|
|
-5.5
|
%
|
|
|
(194.1
|
)
|
|
-6.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income (a)
|
|
|
|
|
$
|
455.0
|
|
|
13.1
|
%
|
|
$
|
400.6
|
|
|
12.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) "GAAP" (reported) results were determined in accordance with
U.S. generally accepted accounting principles (GAAP).
|
(b) Adjusted results are non-GAAP measures and for income measures
exclude certain charges to cost of revenues (see note (c) for
details); certain credits/charges to selling, general and
administrative expenses (see note (d) for details); amortization of
acquisition-related intangible assets; restructuring and other
costs, net (see note (e) for details); certain other gains or losses
that are either isolated or cannot be expected to occur again with
any regularity or predictability (see note (f) for details); the tax
consequences of the preceding items and certain other tax items (see
note (g) for details); and discontinued operations.
|
(c) Reported results in 2013 and 2012 include $1.4 and $0.7,
respectively, of accelerated depreciation on manufacturing assets to
be abandoned due to facility consolidations. Reported results in
2012 also include $12.4 of charges for the sale of inventories
revalued at the date of acquisition.
|
(d) Reported results in 2013 include $25.6 of transaction costs
related to the acquisition of Life Technologies. Reported results in
2012 include $1.1 of transaction costs related to the acquisition of
One Lambda, offset by income, net, of $1.7 from revisions of
estimated contingent consideration for recent acquisitions.
|
(e) Reported results in 2013 and 2012 include restructuring and
other costs, net, consisting principally of severance, abandoned
facility and other expenses of headcount reductions within several
businesses and real estate consolidations.
|
(f) Reported results in 2013 include $13.4 of charges related to
amortization of fees paid to obtain bridge financing commitments
related to the Life Technologies acquisition.
|
(g) Reported provision for income taxes includes i) $76.3 and $75.4
of incremental tax benefit in 2013 and 2012, respectively, for the
pre-tax reconciling items between GAAP and adjusted net income; ii)
in 2013, $10.4 of incremental tax provision principally from
adjusting the company's deferred tax balances as a result of tax
rate changes; and iii) in 2012, $55.0 of incremental tax benefit
from adjusting the company's deferred tax balances as a result of
tax rate changes.
|
(h) Free cash flow in 2013 was reduced by $28.9 of fees to obtain
bridge financing commitments and other transaction costs related to
the acquisition of Life Technologies.
|
Notes:
|
Consolidated depreciation expense in 2013 and 2012 is $60.4 and
$60.3, respectively.
|
Consolidated equity compensation expense included in both reported
and adjusted results is $24.3 and $20.4 in 2013 and 2012,
respectively.
|
Consolidated Statement of Income (a)(b)
|
|
|
|
|
|
|
Year Ended
|
|
|
|
|
|
|
December 31, 2013
|
|
|
% of Revenues
|
|
December 31, 2012
|
|
|
% of Revenues
|
(In millions except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
$
|
13,090.3
|
|
|
|
|
$
|
12,509.9
|
|
|
|
Costs and Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues (c)
|
|
|
|
|
|
7,339.2
|
|
|
56.1
|
%
|
|
|
6,993.0
|
|
|
55.9
|
%
|
Selling, general and administrative expenses (d)
|
|
|
|
|
|
2,905.2
|
|
|
22.2
|
%
|
|
|
2,828.7
|
|
|
22.6
|
%
|
Amortization of acquisition-related intangible assets
|
|
|
|
|
|
763.1
|
|
|
5.8
|
%
|
|
|
747.6
|
|
|
6.0
|
%
|
Research and development expenses
|
|
|
|
|
|
395.5
|
|
|
3.0
|
%
|
|
|
376.4
|
|
|
3.0
|
%
|
Restructuring and other costs, net (e)
|
|
|
|
|
|
77.7
|
|
|
0.6
|
%
|
|
|
82.1
|
|
|
0.7
|
%
|
|
|
|
|
|
|
|
11,480.7
|
|
|
87.7
|
%
|
|
|
11,027.8
|
|
|
88.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
|
|
|
|
1,609.6
|
|
|
12.3
|
%
|
|
|
1,482.1
|
|
|
11.8
|
%
|
Interest Income
|
|
|
|
|
|
28.0
|
|
|
|
|
|
25.2
|
|
|
|
Interest Expense
|
|
|
|
|
|
(262.1
|
)
|
|
|
|
|
(241.6
|
)
|
|
|
Other (Expense) Income, Net (f)
|
|
|
|
|
|
(56.0
|
)
|
|
|
|
|
3.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from Continuing Operations Before Income Taxes
|
|
|
|
|
|
1,319.5
|
|
|
|
|
|
1,269.4
|
|
|
|
Provision for Income Taxes (g)
|
|
|
|
|
|
(40.4
|
)
|
|
|
|
|
(11.0
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from Continuing Operations
|
|
|
|
|
|
1,279.1
|
|
|
|
|
|
1,258.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from Discontinued Operations, Net of Tax
|
|
|
|
|
|
(0.7
|
)
|
|
|
|
|
(19.2
|
)
|
|
|
Loss on Disposal of Discontinued Operations, Net of Tax
|
|
|
|
|
|
(5.1
|
)
|
|
|
|
|
(61.3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
|
|
|
$
|
1,273.3
|
|
|
9.7
|
%
|
|
$
|
1,177.9
|
|
|
9.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per Share from Continuing Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
$
|
3.55
|
|
|
|
|
$
|
3.46
|
|
|
|
Diluted
|
|
|
|
|
$
|
3.50
|
|
|
|
|
$
|
3.43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
$
|
3.53
|
|
|
|
|
$
|
3.24
|
|
|
|
Diluted
|
|
|
|
|
$
|
3.48
|
|
|
|
|
$
|
3.21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
360.3
|
|
|
|
|
|
363.8
|
|
|
|
Diluted
|
|
|
|
|
|
365.8
|
|
|
|
|
|
366.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Adjusted Operating Income and Adjusted
Operating Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income (a)
|
|
|
|
|
$
|
1,609.6
|
|
|
12.3
|
%
|
|
$
|
1,482.1
|
|
|
11.8
|
%
|
Cost of Revenues Charges (c)
|
|
|
|
|
|
28.6
|
|
|
0.2
|
%
|
|
|
55.6
|
|
|
0.4
|
%
|
Selling, General and Administrative Costs, Net (d)
|
|
|
|
|
|
73.5
|
|
|
0.6
|
%
|
|
|
12.5
|
|
|
0.1
|
%
|
Restructuring and Other Costs, Net (e)
|
|
|
|
|
|
77.7
|
|
|
0.6
|
%
|
|
|
82.1
|
|
|
0.7
|
%
|
Amortization of Acquisition-related Intangible Assets
|
|
|
|
|
|
763.1
|
|
|
5.8
|
%
|
|
|
747.6
|
|
|
6.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Operating Income (b)
|
|
|
|
|
$
|
2,552.5
|
|
|
19.5
|
%
|
|
$
|
2,379.9
|
|
|
19.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Adjusted Net Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net Income (a)
|
|
|
|
|
$
|
1,273.3
|
|
|
9.7
|
%
|
|
$
|
1,177.9
|
|
|
9.4
|
%
|
Cost of Revenues Charges (c)
|
|
|
|
|
|
28.6
|
|
|
0.2
|
%
|
|
|
55.6
|
|
|
0.4
|
%
|
Selling, General and Administrative Costs, Net (d)
|
|
|
|
|
|
73.5
|
|
|
0.6
|
%
|
|
|
12.5
|
|
|
0.1
|
%
|
Restructuring and Other Costs, Net (e)
|
|
|
|
|
|
77.7
|
|
|
0.6
|
%
|
|
|
82.1
|
|
|
0.7
|
%
|
Amortization of Acquisition-related Intangible Assets
|
|
|
|
|
|
763.1
|
|
|
5.8
|
%
|
|
|
747.6
|
|
|
6.0
|
%
|
Restructuring and Other Costs, Net – Equity Investments
|
|
|
|
|
|
-
|
|
|
0.0
|
%
|
|
|
2.1
|
|
|
0.0
|
%
|
Amortization of Acquisition-related Intangible Assets – Equity
Investments
|
|
|
|
|
|
2.4
|
|
|
0.0
|
%
|
|
|
2.7
|
|
|
0.0
|
%
|
Other Expense, Net (f)
|
|
|
|
|
|
58.0
|
|
|
0.4
|
%
|
|
|
0.5
|
|
|
0.0
|
%
|
Provision for Income Taxes (g)
|
|
|
|
|
|
(300.7
|
)
|
|
-2.3
|
%
|
|
|
(351.7
|
)
|
|
-2.8
|
%
|
Discontinued Operations, Net of Tax
|
|
|
|
|
|
5.8
|
|
|
0.1
|
%
|
|
|
80.5
|
|
|
0.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income (b)
|
|
|
|
|
$
|
1,981.7
|
|
|
15.1
|
%
|
|
$
|
1,809.8
|
|
|
14.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Adjusted Earnings per Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP EPS (a)
|
|
|
|
|
$
|
3.48
|
|
|
|
|
$
|
3.21
|
|
|
|
Cost of Revenues Charges, Net of Tax (c)
|
|
|
|
|
|
0.05
|
|
|
|
|
|
0.11
|
|
|
|
Selling, General and Administrative Costs, Net of Tax (d)
|
|
|
|
|
|
0.16
|
|
|
|
|
|
0.03
|
|
|
|
Restructuring and Other Costs, Net of Tax (e)
|
|
|
|
|
|
0.16
|
|
|
|
|
|
0.15
|
|
|
|
Amortization of Acquisition-related Intangible Assets, Net of Tax
|
|
|
|
|
|
1.45
|
|
|
|
|
|
1.36
|
|
|
|
Restructuring and Other Costs, Net of Tax – Equity Investments
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
Amortization of Acquisition-related Intangible Assets, Net of Tax –
Equity Investments
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
Other Expense, Net of Tax (f)
|
|
|
|
|
|
0.09
|
|
|
|
|
|
-
|
|
|
|
Provision for Income Taxes (g)
|
|
|
|
|
|
0.01
|
|
|
|
|
|
(0.14
|
)
|
|
|
Discontinued Operations, Net of Tax
|
|
|
|
|
|
0.02
|
|
|
|
|
|
0.22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EPS (b)
|
|
|
|
|
$
|
5.42
|
|
|
|
|
$
|
4.94
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Free Cash Flow
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net Cash Provided by Operating Activities (a)
|
|
|
|
|
$
|
2,010.7
|
|
|
|
|
$
|
2,039.5
|
|
|
|
Net Cash Used in Discontinued Operations
|
|
|
|
|
|
4.9
|
|
|
|
|
|
28.4
|
|
|
|
Purchases of Property, Plant and Equipment
|
|
|
|
|
|
(282.4
|
)
|
|
|
|
|
(315.1
|
)
|
|
|
Proceeds from Sale of Property, Plant and Equipment
|
|
|
|
|
|
20.7
|
|
|
|
|
|
12.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow (h)
|
|
|
|
|
$
|
1,753.9
|
|
|
|
|
$
|
1,765.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Data
|
|
|
|
|
Year Ended
|
|
|
|
|
|
|
December 31, 2013
|
|
|
% of Revenues
|
|
December 31, 2012
|
|
|
% of Revenues
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Analytical Technologies
|
|
|
|
|
$
|
4,125.1
|
|
|
31.5
|
%
|
|
$
|
4,017.9
|
|
|
32.1
|
%
|
Specialty Diagnostics
|
|
|
|
|
|
3,191.7
|
|
|
24.4
|
%
|
|
|
2,962.3
|
|
|
23.7
|
%
|
Laboratory Products and Services
|
|
|
|
|
|
6,350.5
|
|
|
48.5
|
%
|
|
|
6,053.7
|
|
|
48.4
|
%
|
Eliminations
|
|
|
|
|
|
(577.0
|
)
|
|
-4.4
|
%
|
|
|
(524.0
|
)
|
|
-4.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Revenues
|
|
|
|
|
$
|
13,090.3
|
|
|
100.0
|
%
|
|
$
|
12,509.9
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income and Operating Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Analytical Technologies
|
|
|
|
|
$
|
767.8
|
|
|
18.6
|
%
|
|
$
|
749.1
|
|
|
18.6
|
%
|
Specialty Diagnostics
|
|
|
|
|
|
866.7
|
|
|
27.2
|
%
|
|
|
761.2
|
|
|
25.7
|
%
|
Laboratory Products and Services
|
|
|
|
|
|
918.0
|
|
|
14.5
|
%
|
|
|
869.6
|
|
|
14.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal Reportable Segments
|
|
|
|
|
|
2,552.5
|
|
|
19.5
|
%
|
|
|
2,379.9
|
|
|
19.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues Charges (c)
|
|
|
|
|
|
(28.6
|
)
|
|
-0.2
|
%
|
|
|
(55.6
|
)
|
|
-0.4
|
%
|
Selling, General and Administrative Costs, Net (d)
|
|
|
|
|
|
(73.5
|
)
|
|
-0.6
|
%
|
|
|
(12.5
|
)
|
|
-0.1
|
%
|
Restructuring and Other Costs, Net (e)
|
|
|
|
|
|
(77.7
|
)
|
|
-0.6
|
%
|
|
|
(82.1
|
)
|
|
-0.7
|
%
|
Amortization of Acquisition-related Intangible Assets
|
|
|
|
|
|
(763.1
|
)
|
|
-5.8
|
%
|
|
|
(747.6
|
)
|
|
-6.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income (a)
|
|
|
|
|
$
|
1,609.6
|
|
|
12.3
|
%
|
|
$
|
1,482.1
|
|
|
11.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) "GAAP" (reported) results were determined in accordance with
U.S. generally accepted accounting principles (GAAP). In February
2013, in connection with a change in management responsibility for
two product lines, the company transferred its water analysis and
research serum and media product lines to the Laboratory Products
and Services segment from the Analytical Technologies segment. Prior
period segment information has been reclassified to reflect these
transfers.
|
(b) Adjusted results are non-GAAP measures and for income measures
exclude certain charges to cost of revenues (see note (c) for
details); certain credits/charges to selling, general and
administrative expenses (see note (d) for details); amortization of
acquisition-related intangible assets; restructuring and other
costs, net (see note (e) for details); certain other gains or losses
that are either isolated or cannot be expected to occur again with
any regularity or predictability (see note (f) for details); the tax
consequences of the preceding items and certain other tax items (see
note (g) for details); and discontinued operations.
|
(c) Reported results in 2013 and 2012 include $23.9 and $52.4,
respectively, of charges for the sale of inventories revalued at the
date of acquisition. Reported results in 2013 and 2012 also include
$4.7 and $3.2, respectively, of accelerated depreciation on
manufacturing assets to be abandoned due to facility consolidations.
|
(d) Reported results in 2013 include $51.7 of transaction costs
related to the acquisition of Life Technologies, a charge of $13.5
for revision of estimated contingent consideration for recent
acquisitions and a charge of $8.3 associated with product liability
litigation. Reported results in 2012 include $14.1 of transaction
costs related to the acquisition of One Lambda, offset in part by
income, net, of $1.4 from revisions of estimated contingent
consideration for recent acquisitions and a net gain of $0.2
associated with product liability litigation.
|
(e) Reported results in 2013 and 2012 include restructuring and
other costs, net, consisting principally of severance, abandoned
facility and other expenses of headcount reductions within several
businesses and real estate consolidations. Reported results in 2012
include charges of $10.7 for impairment of intangible assets
associated with several small business units and a $5.9 gain on a
pre-acquisition litigation related-matter.
|
(f) Reported results in 2013 include $73.9 of charges related to
amortization of fees paid to obtain bridge financing commitments
related to the Life Technologies acquisition, offset in part by
$10.5 of realized gains on available-for-sale investments
irrevocably contributed to the company's UK pension plans and $5.4
of gains from sales of equity investments. Reported results in 2012
include $0.5 of loss on extinguishment of debt facilities associated
with the termination and replacement of the company's prior
revolving credit agreements.
|
(g) Reported provision for income taxes includes i) $306.1 and
$299.1 of incremental tax benefit in 2013 and 2012, respectively,
for the pre-tax reconciling items between GAAP and adjusted net
income; ii) in 2013, $5.4 of incremental tax provision principally
from adjusting the company's deferred tax balances as a result of
tax rate changes; and iii) in 2012, $52.6 of incremental tax benefit
from adjusting the company's deferred tax balances as a result of
tax rate changes.
|
(h) Free cash flow in 2013 was reduced by $108.4 of fees to obtain
bridge financing commitments and other transaction costs related to
the acquisition of Life Technologies.
|
Notes:
|
Consolidated depreciation expense in 2013 and 2012 is $236.8 and
$236.1, respectively.
|
Consolidated equity compensation expense included in both reported
and adjusted results is $90.9 and $78.2 in 2013 and 2012,
respectively.
|
Condensed Consolidated Balance Sheet
|
|
|
|
|
|
|
|
December 31, 2013
|
|
December 31, 2012
|
(In millions)
|
|
|
|
|
|
|
Assets
|
|
|
|
Current Assets:
|
|
|
|
Cash and cash equivalents
|
$
|
5,826.0
|
|
$
|
805.6
|
Short-term investments
|
|
4.5
|
|
|
4.3
|
Accounts receivable, net
|
|
1,942.3
|
|
|
1,804.9
|
Inventories
|
|
1,494.5
|
|
|
1,443.3
|
Other current assets
|
|
617.1
|
|
|
776.7
|
|
|
|
|
|
Total current assets
|
|
9,884.4
|
|
|
4,834.8
|
|
|
|
|
|
Property, Plant and Equipment, Net
|
|
1,767.4
|
|
|
1,726.4
|
|
|
|
|
|
Acquisition-related Intangible Assets
|
|
7,071.3
|
|
|
7,804.5
|
|
|
|
|
|
Other Assets
|
|
649.8
|
|
|
604.4
|
|
|
|
|
|
Goodwill
|
|
12,503.3
|
|
|
12,474.5
|
|
|
|
|
|
Total Assets
|
$
|
31,876.2
|
|
$
|
27,444.6
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity
|
|
|
|
Current Liabilities:
|
|
|
|
Short-term obligations and current maturities of long-term
obligations (a)
|
$
|
4,178.6
|
|
$
|
93.1
|
Other current liabilities
|
|
2,129.6
|
|
|
2,000.2
|
|
|
|
|
|
Total current liabilities
|
|
6,308.2
|
|
|
2,093.3
|
|
|
|
|
|
Other Long-term Liabilities
|
|
2,403.2
|
|
|
2,855.4
|
|
|
|
|
|
Long-term Obligations
|
|
6,308.7
|
|
|
7,031.2
|
|
|
|
|
|
Total Shareholders' Equity
|
|
16,856.1
|
|
|
15,464.7
|
|
|
|
|
|
Total Liabilities and Shareholders' Equity
|
$
|
31,876.2
|
|
$
|
27,444.6
|
|
|
|
|
|
(a) Debt of $3.2 billion that was issued in connection with the
pending acquisition of Life Technologies is subject to repayment if
the acquisition is not consummated prior to July 14, 2014.
Accordingly, the debt has been classified as a current liability
pending completion of the acquisition.
|
|
During 2013, the company determined that $45 of cash that was
restricted from withdrawal due to serving as collateral for
short-term borrowings in Asia was included in its originally
reported year-end 2012 cash balance. Presentation of this amount has
been revised to other current assets from cash in the above balance
sheet as of December 31, 2012 to properly reflect the restriction on
withdrawal. Cash used for investing activities in the accompanying
cash flow statement for 2012 reflects an increase of $45 from
originally reported amounts for the increase in restricted cash as
of December 31, 2012. The company has evaluated the impact of this
revision, which had no impact on net income, net assets or cash
flows from operations, and concluded it is immaterial to all prior
period financial statements.
|
Condensed Consolidated Statement of Cash Flows
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
|
|
|
|
December 31, 2013
|
|
December 31, 2012
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
Operating Activities
|
|
|
|
|
|
Net income
|
|
$
|
1,273.3
|
|
|
$
|
1,177.9
|
|
|
Loss from discontinued operations
|
|
|
0.7
|
|
|
|
19.2
|
|
|
Loss on disposal of discontinued operations
|
|
|
5.1
|
|
|
|
61.3
|
|
|
Income from continuing operations
|
|
|
1,279.1
|
|
|
|
1,258.4
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile income from continuing operations
|
|
|
|
|
|
to net cash provided by operating activities:
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
999.9
|
|
|
|
983.7
|
|
|
|
Change in deferred income taxes
|
|
|
(472.6
|
)
|
|
|
(301.6
|
)
|
|
|
Other non-cash expenses, net
|
|
|
88.7
|
|
|
|
161.7
|
|
|
|
Changes in assets and liabilities, excluding the effects
|
|
|
|
|
|
|
of acquisitions and dispositions
|
|
|
120.5
|
|
|
|
(34.3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by continuing operations
|
|
|
2,015.6
|
|
|
|
2,067.9
|
|
|
|
|
Net cash used in discontinued operations
|
|
|
(4.9
|
)
|
|
|
(28.4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
|
2,010.7
|
|
|
|
2,039.5
|
|
|
|
|
|
|
|
|
|
|
Investing Activities
|
|
|
|
|
|
Acquisitions, net of cash acquired
|
|
|
(11.4
|
)
|
|
|
(1,083.4
|
)
|
|
Purchases of property, plant and equipment
|
|
|
(282.4
|
)
|
|
|
(315.1
|
)
|
|
Proceeds from sale of property, plant and equipment
|
|
|
20.7
|
|
|
|
12.8
|
|
|
Decrease (increase) in restricted cash
|
|
|
4.0
|
|
|
|
(45.1
|
)
|
|
Other investing activities, net
|
|
|
5.8
|
|
|
|
1.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in continuing operations
|
|
|
(263.3
|
)
|
|
|
(1,429.7
|
)
|
|
|
|
Net cash provided by discontinued operations
|
|
|
-
|
|
|
|
58.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
(263.3
|
)
|
|
|
(1,370.9
|
)
|
|
|
|
|
|
|
|
|
|
Financing Activities
|
|
|
|
|
|
Net proceeds from issuance of debt
|
|
|
3,167.8
|
|
|
|
1,282.1
|
|
|
Increase (decrease) in commercial paper, net
|
|
|
199.9
|
|
|
|
(849.3
|
)
|
|
Redemption and repayment of long-term obligations
|
|
|
(1.0
|
)
|
|
|
(354.5
|
)
|
|
(Decrease) increase in short-term notes payable
|
|
|
(12.0
|
)
|
|
|
24.0
|
|
|
Purchases of company common stock
|
|
|
(89.8
|
)
|
|
|
(1,150.0
|
)
|
|
Dividends paid
|
|
|
(216.2
|
)
|
|
|
(142.2
|
)
|
|
Net proceeds from issuance of company common stock
|
|
|
230.4
|
|
|
|
254.1
|
|
|
Tax benefits from stock-based compensation awards
|
|
|
48.8
|
|
|
|
22.7
|
|
|
Other financing activities, net
|
|
|
(17.9
|
)
|
|
|
(4.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
3,310.0
|
|
|
|
(917.7
|
)
|
|
|
|
|
|
|
|
|
|
Exchange Rate Effect on Cash
|
|
|
(37.0
|
)
|
|
|
38.4
|
|
|
|
|
|
|
|
|
|
|
Increase (Decrease) in Cash and Cash Equivalents
|
|
|
5,020.4
|
|
|
|
(210.7
|
)
|
Cash and Cash Equivalents at Beginning of Period
|
|
|
805.6
|
|
|
|
1,016.3
|
|
|
|
|
|
|
|
|
|
|
Cash and Cash Equivalents at End of Period
|
|
$
|
5,826.0
|
|
|
$
|
805.6
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow (a)(b)
|
|
$
|
1,753.9
|
|
|
$
|
1,765.6
|
|
|
|
|
|
|
|
|
|
|
(a) Free cash flow is net cash provided by operating activities of
continuing operations less net purchases of property, plant and
equipment.
|
(b) Free cash flow in 2013 was reduced by $108.4 of fees paid to
obtain bridge financing commitments and other transaction costs
related to the acquisition of Life Technologies.
|
Copyright Business Wire 2014