8-K
DANAHER CORP /DE/ (DHR)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
FORM 8-K
__________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): January 9, 2023
__________________
| DANAHER CORPORATION | |
|---|---|
| (Exact Name of Registrant as Specified in Its Charter) |
__________________
| Delaware | 001-08089 | 59-1995548 | |
|---|---|---|---|
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | |
| 2200 Pennsylvania Avenue, NW | 20037-1701 | ||
| Suite 800W | |||
| Washington, | DC | ||
| (Address of Principal Executive Offices) | (Zip Code) |
202-828-0850
(Registrant’s Telephone Number, Including Area Code)
| Not applicable |
|---|
| (Former Name or Former Address, if Changed Since Last Report) |
__________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | | --- | --- || ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | | --- | --- || ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | | --- | --- || ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | | --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common stock, $0.01 par value | DHR | New York Stock Exchange |
| 5.00% Mandatory Convertible Preferred Stock, Series B, without par value | DHR.PRB | New York Stock Exchange |
| 1.700% Senior Notes due 2024 | DHR 24 | New York Stock Exchange |
| 0.200% Senior Notes due 2026 | DHR/26 | New York Stock Exchange |
| 2.100% Senior Notes due 2026 | DHR 26 | New York Stock Exchange |
| 1.200% Senior Notes due 2027 | DHR/27 | New York Stock Exchange |
| 0.450% Senior Notes due 2028 | DHR/28 | New York Stock Exchange |
| 2.500% Senior Notes due 2030 | DHR 30 | New York Stock Exchange |
| 0.750% Senior Notes due 2031 | DHR/31 | New York Stock Exchange |
| 1.350% Senior Notes due 2039 | DHR/39 | New York Stock Exchange |
| 1.800% Senior Notes due 2049 | DHR/49 | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
| Emerging growth company | ☐ |
|---|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| ITEM 2.02 | RESULTS OF OPERATIONS AND FINANCIAL CONDITION |
|---|
On January 9, 2023, in advance of a public webcast presentation at the J.P. Morgan Healthcare Conference on January 10, 2023 Danaher Corporation issued a press release regarding the Company’s anticipated financial performance for the fourth quarter of 2022 and furnished pursuant to Item 2.02 of Form 8-K such press release as well as the presentation slides attached hereto, each of which is incorporated by reference herein. The presentation slides attached hereto contain certain information regarding Danaher’s anticipated financial performance for 2022.
This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
| ITEM 9.01 | FINANCIAL STATEMENTS AND EXHIBITS | |
|---|---|---|
| (c) | Exhibits: | |
| Exhibit No. | Description | |
| 99.1 | Press release — “Danaher CEO to Comment on Financial Performance” | |
| 99.1PRE | Selected Danaher Presentation Slides for J.P. Morgan Healthcare Conference on January 10, 2023 | |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101) |
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 hereunto duly authorized.
| DANAHER CORPORATION | |||
|---|---|---|---|
| Date: | January 9, 2023 | By: | /s/ Matthew R. McGrew |
| Matthew R. McGrew | |||
| Executive Vice President and Chief Financial Officer |
Document
Exhibit 99.1
DANAHER CEO TO COMMENT ON FINANCIAL PERFORMANCE
Washington, D.C., January 9, 2023 - Danaher Corporation (NYSE: DHR) (the “Company”) announced that its President and Chief Executive Officer, Rainer M. Blair, will comment tomorrow on the Company’s fourth quarter 2022 performance in a presentation at the J.P. Morgan Healthcare Conference at 1:30 p.m. PT.
For the fourth quarter 2022, estimated revenues are anticipated to increase in the low-single digit percent range year-over-year. The Company expects estimated non-GAAP core revenue growth in the high-single digit percent range, which would be above the Company’s previously announced guidance of flat to a low-single digit percent decline. Non-GAAP base business core revenue growth is expected to be in the high single-digit percent range, which is in line with the Company’s previously announced guidance.
Mr. Blair stated, “Our team successfully navigated a challenging environment to deliver better-than-expected fourth quarter results and a strong finish to 2022. We are very pleased with the continued strength in our base business which had another quarter of high-single digit core revenue growth. We also saw better than expected growth in Cepheid’s molecular diagnostics business driven by more than $1 billion in respiratory testing revenue during the quarter.”
Blair continued, “Our fourth quarter results highlight the resilience and attractive end-market positioning of the businesses that make up Danaher today. Looking ahead, we believe the strength of the portfolio, combined with our outstanding team and the power of the Danaher Business System will enable us to continue delivering sustainable, long-term shareholder value for many years to come.”
As previously announced, Danaher will hold its quarterly earnings conference call for the fourth quarter and full year 2022 on Tuesday, January 24, 2023 at 8:00 a.m. ET.
ABOUT DANAHER
Danaher is a global science and technology innovator committed to helping its customers solve complex challenges and improving quality of life around the world. Its family of world class brands has leadership positions in the demanding and attractive health care, environmental and applied end-markets. With more than 20 operating companies, Danaher’s globally diverse team of approximately 80,000 associates is united by a common culture and operating system, the Danaher Business System, and its Shared Purpose, Helping Realize Life’s Potential. For more information, please visit www.danaher.com.
FORWARD LOOKING STATEMENTS
Statements in this release that are not strictly historical, including the statements regarding the Company's estimated financial performance for the fourth quarter and future prospects, future shareholder value generation and any other statements regarding events or developments that we believe or anticipate will or may occur in the future are "forward-looking" statements within the meaning of the federal securities laws. There are a number of important factors that could cause actual results, developments and business decisions to differ materially from those suggested or indicated by such forward-looking statements and you should not place undue reliance on any such forward-looking statements. These factors include, among other things, the highly uncertain and unpredictable severity, magnitude and duration of the COVID-19 pandemic (and the related governmental, business and community responses thereto) on our business, results of operations and financial condition, the impact of our debt obligations on our operations and liquidity, deterioration of or instability in the economy, the markets we serve and the financial markets (including as a result of the COVID-19 pandemic), uncertainties relating to U.S. laws or policies, including potential changes in U.S. trade policies and tariffs and the reaction of other countries thereto, contractions or growth rates and cyclicality of markets we serve, competition, our ability to develop and successfully market new products and technologies and expand into new markets, the potential for improper conduct by our employees, agents or business partners, our compliance with applicable laws and regulations (including rules relating to off-label marketing and other regulations relating to medical devices and the health care industry), the results of our clinical trials and perceptions thereof, our ability to effectively address cost reductions and other changes in the health care industry, our ability to successfully identify and consummate appropriate acquisitions and strategic investments and successfully complete divestitures and other dispositions, our ability to integrate the businesses we acquire and achieve the anticipated growth, synergies and other benefits of such acquisitions, contingent liabilities and other risks relating to acquisitions, investments, strategic relationships and divestitures (including tax-related and other contingent liabilities relating to past and future IPOs, split-offs or spin-offs), security breaches or other disruptions of our information technology systems or violations of data privacy laws, the impact of our restructuring activities on our ability to grow, risks relating to potential impairment of goodwill and other intangible assets, currency exchange rates, tax audits and
changes in our tax rate and income tax liabilities, changes in tax laws applicable to multinational companies, litigation and other contingent liabilities including intellectual property and environmental, health and safety matters, the rights of the United States government to use, disclose and license certain intellectual property we license if we fail to commercialize it, risks relating to product, service or software defects, product liability and recalls, risks relating to product manufacturing, our relationships with and the performance of our channel partners, uncertainties relating to collaboration arrangements with third-parties, commodity costs and surcharges, our ability to adjust purchases and manufacturing capacity to reflect market conditions, reliance on sole sources of supply, the impact of deregulation on demand for our products and services, the impact of climate change, or legal or regulatory measures to address climate change, labor matters and our ability to recruit, retain and motivate talented employees, international economic, political, legal, compliance, social and business factors (including the impact of the military conflict between Russia and Ukraine and the United Kingdom's separation from the European Union), disruptions relating to man-made and natural disasters (including pandemics such as COVID-19), pension plan costs, inflation and supply chain disruption. Additional information regarding the factors that may cause actual results to differ materially from these forward-looking statements is available in our SEC filings, including our 2021 Annual Report on Form 10-K and Quarterly Report on Form 10-Q for the third quarter of 2022. These forward-looking statements speak only as of the date of this release and except to the extent required by applicable law, the Company does not assume any obligation to update or revise any forward-looking statement, whether as a result of new information, future events and developments or otherwise.
CONTACT
John T. Bedford
Vice President, Investor Relations
Danaher Corporation
2200 Pennsylvania Avenue, N.W., Suite 800W
Washington, D.C. 20037
Telephone: (202) 828-0850
Fax: (202) 828-0860
DANAHER CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
Estimated Sales Growth, Core Sales Growth and Base Business Core Sales Growth
| % Estimated Change Three-Month Period Ended December 31, 2022 vs. Comparable 2021 Period | |
|---|---|
| Total sales growth (GAAP) | +Low-single digit |
| Impact of: | |
| Acquisitions/divestitures | Flat |
| Currency exchange rates | +Mid-single digit |
| Core sales growth (non-GAAP) | +High-single digit |
| Impact of COVID-19 related testing | Flat |
| Base business core sales growth (non-GAAP) | +High-single digit |
Statement Regarding Non-GAAP Measures
Core sales growth (and the related measure “base business core sales growth”) should be considered in addition to, and not as a replacement for or superior to, sales growth, and may not be comparable to similarly titled measures reported by other companies. Management believes that these measures provide useful information to investors by offering an additional way of viewing Danaher Corporation’s (“Danaher” or the “Company”) results that, when reconciled to the corresponding GAAP measure, help our investors to identify underlying growth trends in our business and compare our revenue performance with prior and future periods and to our peers.
Management uses core sales growth and base business core sales growth to measure the Company’s financial performance and uses core sales growth as a performance criteria in the Company’s executive compensation program.
While we expect overall demand for the Company’s COVID-19 related products to moderate as and to the extent the pandemic subsides, as the pandemic evolves toward endemic status we believe a level of demand for the Company’s products that support COVID-19 related vaccines and therapeutics (including initiatives that seek to prevent or mitigate similar, future pandemics) and COVID-19 testing will continue. However, on a relative basis, we expect the level of ongoing demand for products supporting COVID-19 testing will be subject to more fluctuations in demand than the level of demand for products supporting COVID-19 related vaccines and therapeutics. Therefore, in addition to disclosing core revenue growth, we disclose “base business core sales growth” on a basis that excludes revenues related to COVID-19 testing and includes revenues from products that support COVID-19 related vaccines and therapeutics. We believe this additional measure provides useful information to investors by facilitating period-to-period comparisons of our financial performance and identifying underlying growth trends in the Company’s business that otherwise may be obscured by fluctuations in demand for COVID-19 testing as a result of the pandemic.
With respect to these non-GAAP measures, (1) we also exclude the impact of currency translation because it is not under management’s control, is subject to volatility and can obscure underlying business trends, and (2) we also exclude the effect of acquisitions and divested product lines because the timing, size, number and nature of such transactions can vary significantly from period-to-period and between us and our peers, which we believe may obscure underlying business trends and make comparisons of long-term performance difficult.
3
selecteddanaherpresentat
Forward Looking Statements Statements in this presentation that are not strictly historical, including any statements regarding Danaher’s anticipated financial performance and any other statements regarding events or developments that we believe or anticipate will or may occur are "forward-looking" statements within the meaning of the federal securities laws. There are a number of important factors that could cause actual results, developments and business decisions to differ materially from those suggested or indicated by such forward-looking statements and you should not place undue reliance on any such forward-looking statements. These factors include, among other things the highly uncertain and unpredictable severity, magnitude and duration of the COVID-19 pandemic (and the related governmental, business and community responses thereto) on our business, results of operations and financial condition, the impact of our debt obligations on our operations and liquidity, deterioration of or instability in the economy, the markets we serve and the financial markets (including as a result of the COVID-19 pandemic), uncertainties relating to U.S. laws or policies, including potential changes in U.S. trade policies and tariffs and the reaction of other countries thereto, contractions or growth rates and cyclicality of markets we serve, competition, our ability to develop and successfully market new products and technologies and expand into new markets, the potential for improper conduct by our employees, agents or business partners, our compliance with applicable laws and regulations (including rules relating to off-label marketing and other regulations relating to medical devices and the health care industry), the results of our clinical trials and perceptions thereof, our ability to effectively address cost reductions and other changes in the health care industry, our ability to successfully identify and consummate appropriate acquisitions and strategic investments and successfully complete divestitures and other dispositions, our ability to integrate the businesses we acquire and achieve the anticipated growth, synergies and other benefits of such acquisitions, contingent liabilities and other risks relating to acquisitions, investments, strategic relationships and divestitures (including tax-related and other contingent liabilities relating to past and future IPOs, split-offs or spin-offs), security breaches or other disruptions of our information technology systems or violations of data privacy laws, the impact of our restructuring activities on our ability to grow, risks relating to potential impairment of goodwill and other intangible assets, currency exchange rates, tax audits and changes in our tax rate and income tax liabilities, changes in tax laws applicable to multinational companies, litigation and other contingent liabilities including intellectual property and environmental, health and safety matters, the rights of the United States government to use, disclose and license certain intellectual property we license if we fail to commercialize it, risks relating to product, service or software defects, product liability and recalls, risks relating to product manufacturing, our relationships with and the performance of our channel partners, uncertainties relating to collaboration arrangements with third-parties, commodity costs and surcharges, our ability to adjust purchases and manufacturing capacity to reflect market conditions, reliance on sole sources of supply, the impact of deregulation on demand for our products and services, the impact of climate change, or legal or regulatory measures to address climate change, labor matters and our ability to recruit, retain and motivate talented employees, international economic, political, legal, compliance, social and business factors (including the impact of the military conflict between Russia and Ukraine and the United Kingdom's separation from the EU), disruptions relating to man-made and natural disasters (including pandemics such as COVID-19), pension plan costs, inflation and supply chain disruption. Additional information regarding the factors that may cause actual results to differ materially from these forward-looking statements is available in our SEC filings, including our 2021 Annual Report on Form 10-K and Quarterly Report on Form 10-Q for the third quarter of 2022. These forward-looking statements speak only as of the date of this presentation and except to the extent required by applicable law, the Company does not assume any obligation to update or revise any forward-looking statement, whether as a result of new information, future events and developments or otherwise. With respect to the non-GAAP financial measures referenced in the following presentation, definitions and the accompanying information required by SEC Regulation G can be found in this presentation or in the “Investors” section of Danaher’s web site, www.danaher.com. All references in this presentation (1) to financial metrics relate only to the continuing operations of Danaher’s business, unless otherwise noted; (2) to “growth” or other period-to-period changes refer to year-over-year comparisons unless otherwise indicated; (3) to core revenue growth for 2020 and 2021 refers to core revenue growth including Cytiva unless otherwise noted; and (4) to operating profit below the segment level exclude amortization. We may also describe certain products and devices which have applications submitted and pending for certain regulatory approvals. 1
2
Current Update 3 Strong finish to 2022 with Q4 results exceeding expectations Q4 2022 ESTIMATED CORE REVENUE GROWTH UP HIGH-SINGLE DIGITS — High-single digit base business core revenue growth as expected — Better-than-expected respiratory testing revenue at Cepheid — Anticipate respiratory testing revenue of >$1B EXPECT STRONG EARNINGS AND CASH FLOW WITH ADJUSTED OPERATING PROFIT MARGIN EXCEEDING PRIOR GUIDANCE EAS SEPARATION ON TRACK FOR Q4 2023
Environmental & Applied Solutions Separation A global leader in Water Quality and Product Identification MSD CORE REVENUE GROWTH ~55% RECURRING REVENUE ~25% ADJUSTED EBITDA MARGIN ANTICIPATED BUSINESS PROFILE • Leading positions and outstanding brands, foundation built on DBS • Attractive financial profile: MSD anticipated long-term core revenue growth, outstanding margins & cash flow • Strong sustainability & ESG positioning • Bias toward M&A with flexibility in capital deployment ANTICIPATED LONG- TERM PERFORMANCE 2022E TOTAL REVENUE PID ~40% ~$4.8B WATER ~60% ANTICIPATED LEADERSHIP • Jennifer Honeycutt, President and CEO 4
5 DIAGNOSTICS: ~$10.8B 2022E REVENUE *Anticipated long-term core revenue growth rate Pie chart reflects FY 2022E revenue by product line Danaher 2024+: A Focused Science & Technology Leader Outstanding businesses focused on impacting human health MSD* CLINICAL LDD* MOLECULAR HSD* PATHOLOGY & ACUTE / POC HSD LONG-TERM GROWTH RATE* LIFE SCIENCES: ~$7.0B 2022E REVENUE HSD LONG-TERM GROWTH RATE* DD+* GENOMICS MSD+* LS INSTRUMENTS Industrial BIOTECHNOLOGY: ~$8.8B 2022E REVENUE HSD LONG-TERM GROWTH RATE* RESEARCH, LAB & MEDICAL BIOPROCESSING Life Sciences During the 4th quarter of 2022, DHR changed the composition of its reportable segments. The businesses that previously comprised the former Life Sciences segment will be reported in two separate segments, Life Sciences and Biotechnology.
Cytiva’s Progress Since Acquisition AT ACQ. 2022E Revenue ~$3B >$6B Anticipated long-term core revenue growth +6-7% +HSD ROIC +DD Exceeding expectations on all fronts RESULTS SINCE ACQUISITIONKEY PRIORITIES & PROGRESS SINCE ACQUISITION Stand-up & Brand Establishment >3,000 ASSOCIATES HIRED BRAND POWER & PREMIUM VS PEERS (CERNER ENVIZA) #2>200 TRANSITION SERVICES AGREEMENTS EXITED Capacity Expansion & Investments >$1.5B PLANNED CAPACITY INVESTMENT AT PALL & CYTIVA 2021-2025 OUTPUT OF SUT PRODUCTS>2X 6 Embracing DBS MANUFACTURING KAIZENS 2021 & 2022>400 2X IMPROVEMENT IN PROJECT OTD WITHIN FIRST YEAR
Biotechnology Aligning to best serve our customers 2022E TOTAL REVENUE Life Sciences Research Lab & Medical 7 BROADEST PORTFOLIO ACROSS BIOPROCESSING WORKFLOW • Leading positions in upstream & downstream applications • Single-use technologies (SUT) >$1B 2022E revenue BEST-IN-CLASS TECHNICAL SERVICE & SUPPORT • Process development services to move from R&D to commercialization • Local presence in all major regions to support customers GLOBAL SCALE TO RELIABLY MEET OUR CUSTOMERS’ NEEDS • Products and solutions span from lab to production scale • Current & future expansion plans to help ensure security of supply for customers • Enhancing our value proposition through organic & inorganic investments Bioprocessing ~$8.8B
MSD HSD LSD HSD/LDD LSD MSD>40% INCREASE IN REVENUE FROM NEW PRODUCTS LAST 3 YEARS PRODUCT LAUNCH EXCELLENCE AT Accelerating Innovation Across Life Sciences DBS GROWTH TOOLS INCREASING THE CADENCE OF INNOVATION >30 NEW PRODUCTS LAUNCHED SINCE 2018 ACCELERATED PRODUCT DEVELOPMENT AT 2021 REVENUE GROWTH ATTRIBUTED TO NEW PRODUCTS~40%PROBLEM TO PORTFOLIO AT AVG. ANNUAL CORE REVENUE GROWTH IMPROVEMENT Enhancing our growth trajectory with DBS-led innovation 8 2012-2016 2017-Q3 2022
Danaher 2024+: Putting It All Together Now expect HSD long-term core revenue growth CORE REVENUE GROWTH HSD FALL-THROUGH 35-40% STRONG FREE CASH FLOW >100% FCF / NI ACQUISITIONS FCF+ M&A SPEND TOP QUARTILE EPS GROWTH & COMPOUNDING RETURNS DD+ EPS GROWTH + + = + DANAHER HSD HSD 2022E revenue of ~$8.8B including leading bioprocessing franchise LDD >$4.5B 2022E revenue with durable long-term testing opportunity DD+ Differentiated genomics businesses with >$1B 2022E revenue MSD+ Benefit from continued investment spend ANTICIPATED LONG-TERM CORE REVENUE GROWTH RATE LS Instruments & Clinical Dx 9 ANTICIPATED LONG-TERM ANNUAL PERFORMANCE Life Sciences