DANAHER CORPORATION
1995 ANNUAL REPORT
SELECTED FINANCIAL DATA
(000's omitted except per share data)
1995
1994
1993
1992
1991
Net revenues
$1,486,76
9
$1,113,973
$937,633
$845,68
4
$734,42
4
Operating profit
180,257
124,427
87,058
58,899
36,950
Earnings from continuing
operations
105,766
72,319
48,030
30,443
16,719
Per share
1.77
1.24
.83
.53
.29
Discontinued operations
2,550
9,331
5,719
1,158
(3,398)
Per share
.04
.16
.10
.02
(.06)
Earnings before
cumulative effect
of accounting change
108,316
81,650
53,749
31,601
13,321
Per share
1.81
1.40
.93
.55
.23
Cumulative effect of
accounting
change*
--
--
(36,000)
--
--
Per share*
--
--
(.62)
--
--
Net earnings
108,316
81,650
17,749
31,601
13,321
Earnings per common share
1.81
1.40
.31
.55
.23
Dividends declared
4,672
3,710
3,412
--
--
Dividends per share
.08
.065
.06
--
-
-
* Adoption of accrual method specified by SFAS No.
106 for
post retirement benefits.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND
R ESULTS OF OPERATIONS
Results of Operations
Danaher Corporation (the "Company") operates a
variety of
businesses through its wholly-owned subsidiaries. These
businesses are conducted in two business segments:
Tools and
Components and Process/Environmental Controls. In Tools
and
Components, the Company is the principal manufacturer of
Sears,
Roebuck and Co.'s Craftsman line, National Automotive
Parts
Association line, K-D automotive line, and the Matco,
Armstrong
and Allen lines of mechanics' hand tools. The Company
also
manufactures Allen wrenches, Jacobs drill chucks and
diesel engine
retarders, and Coats and Ammco wheel service equipment.
In its
Process/Environmental Controls segment, the Company is a
leading
producer of leak detection sensors for underground fuel
storage
tanks and motion, temperature, pressure, level, flow and
power
reliability and quality control devices.
Presented below is a summary of revenues broken
down by
business segment (000's omitted).
1995
1994
1993
$ % $
% $ %
Tools and
Components
1,005,005
67.6%
$809,989
72.7%
$691,344
73.7%
Process/Environme
ntal Controls
481,764
32.4
303,984
27.3
244,400
26.1
Other
-
-
-
-
1,889
0.2
$1,486,769
100.0%
$1,113,97
3
100.0%
$937,633
100.0%
Tools and Components
The Tools and Components segment is comprised of
the Danaher
Hand Tool Group (including Special Markets and
Professional Tools
divisions), Matco Tools, Jacobs Chuck Manufacturing
Company,
Iseli Company, Delta Consolidated Industries, Jacobs
Vehicle
Equipment Company, Hennessy Industries and the hardware
and
electrical apparatus lines of Joslyn Manufacturing
Company
("JMC"), which was acquired in September, 1995. This
segment is
one of the largest domestic producers and distributors
of general
purpose and specialty mechanics' hand tools. Other
products
manufactured by these companies include tool boxes and
storage
devices, diesel engine retarders, wheel service
equipment, drill
chucks, custom designed headed tools and components,
hardware and
components for the power generation and transmission
industries,
high quality precision socket screws, fasteners, and
high quality
miniature precision parts.
1995 COMPARED TO 1994
Revenues in 1995 were 24% higher than 1994.
Acquisitions
accounted for 17%, while price increases provided 1% and
higher
shipment volumes provided 6%. Demand for drill chucks
and diesel
engine retarders was particularly strong in 1995.
Operating
profit growth exceeded the sales improvement at 39%,
reflecting
continued process improvements in the manufacturing
operations.
The acquired operations of Delta, which were only
reflected for
one month in 1994 operations, and the hardware and
electrical
apparatus lines of JMC provided lesser profit margins
than the
existing business units, partially offsetting the
performance
improvements.
1994 COMPARED TO 1993
Revenues in this segment increased 17% from 1993.
Of this
increase, acquisitions accounted for 1%, and higher unit
volumes
of shipments accounted for 16%, as average pricing was
relatively
unchanged. Sales levels were benefited by particularly
strong
demand for consumer mechanics hand tools and drill
chucks.
Operating margins increased to 10% from 8% in 1993.
This
reflects principally the impact of continued
manufacturing process
improvements, particularly within the hand tool
manufacturing
plants, and the effect of increased volume.
Process/Environmental Controls
The Process/Environmental Controls segment is
comprised of
the Veeder-Root Company, Danaher Controls,
Partlow/Anderson
Instrument, Gulton Industries-Graphic Instruments, West
Instruments, Ltd., Qualitrol Corporation, A.L. Hyde
Company,
Hengstler, and the controls product line business units
of Joslyn
Corporation, which was acquired in September, 1995.
These
companies produce and sell underground storage tank leak
detection
systems and temperature, level and position sensing
devices, power
switches and controls, communication line products,
power
protection products, liquid flow measuring devices and
electronic
and mechanical counting and controlling devices. These
products
are distributed by the Company's sales personnel and
independent
representatives to original equipment manufacturers,
distributors
and other end users.
1995 COMPARED TO 1994
Revenues in 1995 were 58% higher than in 1994 in
this
segment. Business acquisitions in the segment
contributed 52% of
the increase. Of the remaining increase, higher unit
volumes
contributed 5% and increased average pricing provided
1%. Demand
for underground storage tank monitoring equipment
remained strong.
Operating margins decreased from 18.6% to 16.8%,
entirely due to
the impact of the Hengstler and Joslyn acquisitions.
Base
business showed a modest increase in operating margin.
The
Hengstler acquisition has significantly increased market
position
in Europe for the counter and encoder product lines.
1994 COMPARED TO 1993
Revenues in this segment in 1994 increased 24% from
1993.
The full year effect of business acquisitions made in
June, 1993
within this segment contributed 14% of this increase.
The balance
of the increase was caused by higher unit volumes of 8%
and price
increases averaging 2%. Demand was very strong in the
North
American market, particularly for the leak detector
sensor line.
In addition, demand continued to strengthen in overseas
markets.
Operating profit increased 32% from 1993, reflecting the
higher
volume levels and the benefit of plant realignment and
cost
reductions.
Discontinued Operations
In December, 1995, the Company signed an agreement
to sell
its Fayette Tubular Products subsidiary. As the Company
no longer
operates in the Transportation business segment,
Fayette's
operation is shown as a discontinued operation.
Fayette's sales
decreased 11% in 1995 due to lower North American
automobile and
light truck production levels. Profitability decreased
73% due
mainly to lower volume levels and unprofitable
operations of a
newly formed European subsidiary. In 1994, sales
increased 27%
and profit increased 63% due to strong demand from the
automobile
manufacturers. The Fayette disposition was completed in
January,
1996, and a gain of approximately $80 million will be
recognized
in the first quarter of 1996.
Gross Profit
Gross profit, as a percentage of sales, in 1995 was
30.1%, a
1.2 percentage point increase compared to the 28.9%
achieved in
1994. Productivity improvements, combined with
increased fixed
cost leverage, resulted in margin improvement. A shift
in product
mix associated with the acquisitions also increased the
gross
profit margin.
Gross profit margin in 1994 was 28.9%, a 1.3
percentage
point improvement compared to 1993. Productivity
improvements
were achieved in all business segments and increased
volume
improved fixed cost leverage. A shift in mix to the
higher margin
products of the Process/Environmental Controls business
segment
also contributed to the improvement.
Operating Expenses
Selling, general and administrative expenses for
1995 as a
percentage of sales were approximately 0.2 percentage
points
higher than the 1994 level. This reflects higher cost
ratios in
the businesses acquired.
In 1994, selling, general and administrative
expenses were
17.7% of sales, a decrease of .6 percentage points from
1993
levels. Total expenses increased 15%, substantially
less than the
19% increase in total revenues. This reflects continued
streamlining and cost reduction action as well as the
fixed nature
of certain costs.
Interest Costs and Financing Transactions
On December 15, 1992, the Company received the
proceeds from
a $100 million privately placed debt financing. The
notes have a
final maturity on December 15, 1999, an average life of
approximately 5.5 years, and an average interest cost of
7.3%. In
April 1993, the Company received an additional $30
million from a
private placement which matures in April 2003 and has an
interest
cost of 6.99% per annum. These proceeds were used to
reduce
borrowing under the revolving credit facility.
The Company's revolving credit facility provides
for senior
financing of $250 million for general corporate
purposes. The
interest rates for borrowing under the facility float
with base
rates.
The Company's financing requirements in these years
were
satisfied by the financing discussed above and through
borrowings
under uncommitted lines. Interest expense in 1995 was
125% higher
than in 1994, due to higher average borrowing levels
caused
primarily by the acquisitions made in the fourth quarter
of 1994
and the third quarter of 1995. Interest expense in 1994
was 40%
less than in 1993, due to lower average borrowing
levels.
Income Taxes
The effective tax rate decreased 1.4 percentage
points in
1995 to 38.9% of pre-tax income and 0.9 percentage
points in 1994
to 40.3% of pre-tax income. The decrease in 1995 is
principally
due to a lower effective rate on certain foreign
earnings and the
utilization of tax carryforwards in foreign
jurisdictions which
were not previously recognized in earlier years. The
1994
decrease relates principally to the lesser impact of
nondeductible
goodwill amortization given higher pre-tax income.
As of January 1, 1993, the Company adopted the
liability
method of accounting for income taxes specified by SFAS
No. 109.
Its adoption had no impact on the results of operations
and
resulted in certain reclassifications to the Company's
balance
sheet. The one percent increase in the Corporate tax
rate enacted
in 1993 did not materially impact deferred tax balances
reflected
on the Company's balance sheet.
Inflation
The effect of inflation on the Company's operations
has been
minimal in 1995, 1994, and 1993.
Liquidity and Capital Resources
In September, 1995, the Company acquired Joslyn
Corporation
for approximately $245 million in cash consideration.
See Note 2
to Consolidated Financial Statements for a further
discussion of
the impact of the Joslyn acquisition. In December,
1995, the
Company entered into an agreement to sell its Fayette
Tubular
Products subsidiary for $155 million in cash
consideration. The
transaction closed in January, 1996, and the proceeds
were used to
reduce short-term borrowings.
In 1994, the Company acquired Delta Consolidated
Industries,
Hengstler GmbH, Armstrong Brothers Tool Company and
several
smaller entities. Aggregate consideration for these
transactions
was approximately $167 million including approximately
$31 million
in common stock. These acquisitions had no significant
impact on
the 1994 results of operations as the larger
acquisitions were not
completed until the fourth quarter. These entities have
combined
annual sales levels of $220 million.
As discussed previously, $115 million of the
Company's debt
is fixed at an average interest cost of 7.3%.
Substantially all
remaining borrowings are short-term in nature and float
with
referenced base rates. As of December 31, 1995, the
Company has
unutilized commitments under its revolving credit
facility of
$250 million.
Cash flow has been strong in all periods from 1993
through
1995. Operations generated $174 million, $140 million,
and $129
million in cash in 1995, 1994, and 1993, respectively.
The
principal use of funds has been capital expenditures of
$59
million, $35 million, and $33 million in 1995, 1994 and
1993,
respectively and cash paid for acquisitions of $231
million, $136
million, and $54 million in 1995, 1994, and 1993,
respectively.
The net result of the above, combined with working
capital changes
was an increase in debt of $98 million and $52 million
in 1995 and
1994 and a reduction in debt of $35 million in 1993.
The Company's funds provided from operations, as
well as the
existing bank facility and available credit lines,
should provide
sufficient available funds to meet the Company's working
capital,
capital expenditure, dividend and debt service
requirements for
the foreseeable future.
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and Board of
Directors of Danaher Corporation:
We have audited the accompanying consolidated
balance sheets
of Danaher Corporation (a Delaware corporation) and
Subsidiaries
as of December 31, 1995 and 1994, and the related
consolidated
statements of earnings, stockholders' equity, and cash
flows for
each of the three years in the period ended December 31,
1995.
These financial statements are the responsibility of the
Company's
management. Our responsibility is to express an opinion
on these
financial statements based on our audits.
We conducted our audits in accordance with
generally
accepted auditing standards. Those standards require
that we plan
and perform an audit to obtain reasonable assurance
about whether
the financial statements are free of material
misstatement. An
audit includes examining, on a test basis, evidence
supporting the
amounts and disclosures in the financial statements. An
audit
also includes assessing the accounting principles used
and
significant estimates made by management, as well as
evaluating
the overall financial statement presentation. We
believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred
to above
present fairly, in all material respects, the financial
position
of Danaher Corporation and Subsidiaries as of December
31, 1995
and 1994, and the results of their operations and their
cash flows
for each of the three years in the period ended December
31, 1995,
in conformity with generally accepted accounting
principles.
As explained in Notes 1 and 7 to the financial
statements,
effective January 1, 1993, the Company changed its
methods of
accounting for income taxes and post retirement benefits
other
than pensions.
Washington, D.C.
January 26, 1996
DANAHER CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(in thousands of dollars, except per share data)
Year Ended December 31,
1995
1994
1993
Net revenues.. . . . . . . . . . . .
. . . . . . . . . . . . . . . . .
$1,486,769
$1,113,973
$937,633
Cost of sales. . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . .
1,039,622
791,874
678,577
Selling, general and administrative
expenses. . . . .
266,890
197,672
171,998
Total operating expenses. . . .
. . . . . . . . . . . . . .
1,306,512
989,546
850,575
Operating profit. . . . . . . . . . .
. . . . . . . . . . . . . . . . .
180,257
124,427
87,058
Interest expense. . . . . . . . . . .
. . . . . . . . . . . . . . . . .
7,198
3,201
5,361
Earnings from continuing operations
before income taxes and cumulative
effect of accounting change. .
. . . . . . . . . . . . . . . . . . .
. . . . .
173,059
121,226
81,697
Income taxes. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . .
67,293
48,907
33,667
Earnings from continuing operations
before cumulative effect of
accounting change. . . . . . . . .
105,766
72,319
48,030
Earnings from discontinued
operations, net
of income taxes of $1,630,
$5,966 and $3,673
2,550
9,331
5,719
Earnings before cumulative effect of
accounting
change . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
108,316
81,650
53,749
Cumulative effect of accounting
change, net of tax
benefit of $20,000 . . . . . . .
. . . . . . . . . . . . . . . .
-
-
(36,000)
Net earnings. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . .
$108,316
$81,650
$17,749
Per share:
Continuing operations
Discontinued operations
Before accounting change
Cumulative effect of accounting
change
Net earnings
$1.77
.04
1.81
-
$1.81
$1.24
.16
1.40
-
$ 1.40
$ .83
.10
.93
(.62)
$ .31
Average common stock and common
equivalent
shares outstanding. . . . . . .
. . . . . . . . . . . . . . .
59,862,673
58,326,572
57,793,67
2
The accompanying Notes to Consolidated Financial
Statements are
an integral part of these statements.
DANAHER CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands of dollars)
As of December 31,
ASSETS
1995
1994
Current assets:
Cash and equivalents. . . . . . . . . . . . . .
. . . . . . . . . . . . . . . .
$7,938
$3,599
Trade accounts receivable, less allowance for
doubtful
accounts of $13,431 and $9,771 . . . . . .
. . . . . . . . . . . .
224,652
168,159
Inventories. . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . .
201,890
134,941
Prepaid expenses and other. . . . . . . . . . .
. . . . . . . . . . . . . . . . .
31,990
50,671
Total current assets . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
466,470
357,370
Property, plant and equipment, net. . . . . . .
. . . . . . . . . . . . . .
291,937
244,167
Other assets . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . .
119,444
72,609
Excess of cost over net assets of acquired
companies, less amortization of $72,125
and $57,643 . . . . . . . . . . . . . . . . . .
.
608,140
431,499
$1,485,991
$1,105,645
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable and current portion of debt . . .
. . . . . . . . . . . .
$14,970
$68,771
Trade accounts payable. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
92,290
78,109
Accrued expenses. . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
296,878
228,507
Total current liabilities. . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
404,138
375,387
Other liabilities. . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . .
226,925
137,643
Long-term debt . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
268,617
116,515
Stockholders' equity:
Common stock, one cent par value;
125,000,000 shares
authorized; 63,406,214 and 63,198,208
issued; 58,503,008 and 58,295,002
outstanding. . . . . . . . . . . . . . . . . . .
. . . . . .
634
632
Additional paid-in capital. . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
315,205
311,648
Cumulative foreign translation adjustment. . . .
. . . . . . . . . . . .
3,598
590
Retained earnings. . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
304,363
200,719
Treasury stock, at cost; 4,903,206 shares. . . .
. . . . . . . . . . . .
(37,489)
(37,489)
Total stockholders' equity. . . . . . . . .
. . . . . . . . . . . . . . . . .
586,311
476,100
$1,485,991
$1,105,645
The accompanying Notes to Consolidated Financial
Statements are an
integral part of these balance sheets.
DANAHER CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of dollars)
Year Ended December 31,
1995
1994
1993
Cash flows from operating activities:
Earnings from continuing operations . . . . .
. . . . . . . . . . . . . . .
$105,766
$72,319
$ 48,030
Earnings from discontinued operations . . . .
. . . . . . . . . . . . . . .
2,550
9,331
5,719
Depreciation and amortization. . . . . . . . .
. . . . . . . . . . . . . . . .
58,527
42,554
38,397
(Increase) decrease in accounts receivable. .
. . . . . . . . . . . . . . .
(20,098)
(15,786)
637
(Increase) decrease in inventories . . . . . .
. . . . . . . . . . . . . . . .
Increase (decrease) in accounts payable. . . .
. . . . . . . . . . . . . .
(15,589)
626
(938)
8,712
6,946
(224)
Change in other assets and liabilities. . . .
. . . . . . . . . . . . . . . . .
42,374
24,162
29,187
Total operating cash flows. . . . . . . .
. . . . . . . . . . . . . . . . . . .
174,156
140,354
128,692
Cash flows from investing activities:
Payments for additions to property, plant and
equipment, net
Cash acquired in acquisition . . . . . . . . .
. . . . . . . . . . . . . . . . . .
(59,172)
22,784
(34,811)
-
(33,375)
-
Investments in equity securities. . . . . . .
. . . . . . . . . . . . . . . . . .
-
(22,032)
-
Cash paid for acquisition . . . . . . . . . .
. . . . . . . . . . . . . . . . . . .
Net cash used in investing
activities . . . . . . . . . . . . . . . . .
.
(230,725)
(267,113)
(136,055)
(192,898)
(53,960)
(87,335)
Cash flows from financing activities:
Proceeds from issuance of common stock. . . .
. . . . . . . . . . . . . .
3,559
992
1,301
Dividends paid . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . .
(4,672)
(3,420)
(2,559)
Borrowings (repayments) of debt. . . . . . . .
. . . . . . . . . . . . . . . .
98,301
51,701
(65,183)
Proceeds from notes payable. . . . . . . . . .
. . . . . . . . . . . . . . . . . .
-
-
30,000
Net cash provided by (used in) financing
activities. . . . . . .
97,188
49,273
(36,441)
Effect of exchange rate changes on cash. .. .
. . . . . . . . . . . . . . .
108
269
(6)
Net change in cash and equivalents. . . . . .
. . . . . . . . . . . . . . . .
4,339
(3,002)
4,910
Beginning balance of cash and equivalents. . .
. . . . . . . . . . . . .
3,599
6,601
1,691
Ending balance of cash and equivalents . . . .
. . . . . . . . . . . . . .
$ 7,938
$
3,599
$ 6,601
Supplemental disclosures:
Cash interest payments. . . . . . . . . .
. . . . . . . . . . . . . . . . . . .
Cash income tax payments . . . . . . . .
. . . . . . . . . . . . . . . . . .
$ 13,699
$ 69,853
$
9,505
$ 65,837
$ 10,677
$ 37,331
The accompanying Notes to Consolidated Financial
Statements are an
integral part of these statements.
DANAHER CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(in thousands of dollars)
Common Stock
Shares
Amount
Additiona
l Paid-in
Capital
Retaine
d
Earning
s
Treasur
y Stock
Cumulative
Foreign
Translatio
n
Adjustment
Balance, January 1, 1993 . . . .
. . . . .
Net earnings for the year. .
. . . . . . . .
Dividends declared. . . . .
. . . . . . . . .
Common stock issued for
options
exercised. . . . . . . .
. . . . . . .. . . . . .
Decrease from translation
of foreign
financial statements. . .
. . . . . . . . .
61,700,016
-
-
100,312
-
$308
-
-
1
-
$278,232
-
-
1,300
-
$108,758
17,749
(3,412)
-
-
$(37,489
)
-
-
-
-
$(1,430)
-
-
-
(351)
Balance, December 31, 1993. . . .
. . . . .
Net earnings for the year. .
.. . . . . . .
Dividends declared. . . . . .
. . . . . . . .
Common stock issued for
options
exercised. . . . . . . .
. . . . . . .. . . . . .
Common stock issued for
acquisitions
Two-for-one common stock
split
Increase from translation of
foreign
financial statements. . .
. . .
61,800,328
-
-
58,774
1,339,106
-
-
309
-
-
-
7
316
-
279,532
-
-
992
31,124
-
-
123,095
81,650
(3,710)
-
-
(316)
-
(37,489)
-
-
-
-
-
-
(1,781)
-
-
-
-
-
2,371
Balance, December 31, 1994
Net earnings for the year. .
. . . . . . . .
Dividends declared. . . . .
. . . . . . . . .
Common stock issued for
options
exercised. . . . . . . .
. . . . . . .. . . . . .
Increase from translation of
foreign
financial statements. . .
. . . . . . . . .
63,198,208
-
-
208,006
-
632
-
-
2
-
311,648
-
-
3,557
-
200,719
108,316
(4,672)
-
-
(37,489)
-
-
-
590
-
-
3,008
Balance, December 31, 1995
63,406.214
$ 634
$
315,205
$
304,363
$
(37,489)
$ 3,598
The accompanying Notes to Consolidated Financial
Statements are an integral part
of these statements.
(1) Summary of Significant Accounting Policies:
Accounting Principles - The consolidated financial
statements include the accounts of the Company and its
subsidiaries. The accounts of certain of the Company's
foreign
subsidiaries are included on the basis of a fiscal year
ending
November 30. This procedure was adopted to allow
sufficient time
to include these companies in the consolidated financial
statements. All significant intercompany balances and
transactions have been eliminated upon consolidation.
Preparation
of these consolidated financial statements necessarily
includes
the use of management's estimates.
Inventory Valuation - Inventories include material,
labor
and overhead and are stated principally at the lower of
cost or
market using the last-in, first-out method (LIFO).
Property, Plant and Equipment - Property, plant and
equipment are carried at cost. The provision for
depreciation has
been computed principally by the straight-line method
based on the
estimated useful lives (3 to 35 years) of the
depreciable assets.
Other Assets - Other assets include principally
deferred
income taxes, equity securities, noncurrent trade
receivables and
capitalized costs associated with obtaining financings
which are
being amortized over the term of the related debt. The
equity
securities of Joslyn Corporation (see Note 2) are
carried at cost,
which approximates market, at December 31, 1994. No
gains or
losses were reflected in any of the years presented.
Post Retirement Benefits - As of January 1, 1993,
the
Company changed its method of accounting for post
retirement
benefits from recognizing expense as claims are paid to
the
accrual method specified by SFAS No. 106. The Company
elected to
recognize this liability immediately and its adoption is
not
expected to significantly impact the Company's ongoing
results of
operations. This change is reflected net of its tax
benefit as
the cumulative effect of accounting change in the
accompanying
Consolidated Statements of Earnings.
Fair Value of Financial Instruments - For cash and
equivalents, the carrying amount is a reasonable
estimate of fair
value. For long-term debt, rates available for debt
with similar
terms and remaining maturities are used to estimate the
fair value
of existing debt.
Excess of Cost Over Net Assets of Acquired
Companies - This
asset is being amortized on a straight-line basis over
forty
years. $ 14,482,000, $ 9,765,000, and $9,427,000 of
amortization
was charged to expense for the years ended December 31,
1995,
1994, and 1993, respectively.
Foreign Currency Translation - Exchange adjustments
resulting from foreign currency transactions are
generally
recognized in net earnings, whereas adjustments
resulting from the
translation of financial statements are reflected as a
separate
component of stockholders' equity. Net foreign currency
transaction gains or losses are not material in any of
the years
presented.
Statements of Cash Flows - The Company considers
all highly
liquid investments with a maturity of three months or
less at date
of purchase to be cash equivalents.
Income Taxes - The Company provides income taxes
for
unremitted earnings of foreign subsidiaries which are
not
considered permanently reinvested in that operation. As
of
January 1, 1993, the Company adopted the liability
method of
accounting for income taxes specified by SFAS No. 109.
Its
adoption had no impact on the results of operations and
resulted
in certain reclassifications to the Company's balance
sheet.
Earnings Per Share - The computation of earnings
per share
is based on the weighted average number of common shares
and
common stock equivalents outstanding during the year.
Discontinued Operations - In December, 1995, an
agreement
was executed to sell the Fayette Tubular Products
subsidiary for
approximately $155 million. The Company no longer
operates in the
Transportation business segment, and hence prior periods
have been
restated to reflect Fayette as a discontinued operation.
A gain
of approximately $80 million will be recognized in the
first
quarter of 1996. Net revenues for Fayette were $155
million in
1995, $175 million in 1994, and $138 million in 1993.
Net assets
reflected in prepaid expenses and other and in other
assets were
$48 million as of December 31, 1995 and 1994.
(2) Acquisitions:
The Company obtained control of Joslyn Corporation
(Joslyn)
as of September 1, 1995 when Joslyn's shareholders
tendered
approximately 75% of the outstanding shares to Danaher
for $34 per
share in cash. The remaining 25% was acquired in
October, 1995.
Total consideration for Joslyn was approximately $245
million.
The fair value of assets acquired was approximately $
345 million
and approximately $100 million of liabilities were
assumed. The
transaction was accounted for as a step acquisition
purchase.
Results of operations reflect a minority interest
elimination for
the two-month period between the change in control and
the merger
of Joslyn. The purchase price allocations have been
completed on
a preliminary basis, subject to adjustment should new or
additional facts about the businesses become known.
The unaudited pro forma information for the periods
set
forth below give effect to the transaction as if it had
occurred
at the beginning of each period. The pro forma
information is
presented for informational purposes only and is not
necessarily
indicative of the results of operations that actually
would have
been achieved had the acquisition been consummated as of
that
time. Joslyn's $35 million ($21 million after tax
benefit or $.36
per share) provision for environmental remediation
associated with
sites previously owned by Joslyn is reflected in the
1994 amount
(unaudited, 000's omitted):
Year Ended
December 31, December 31,
1995 1994
Net Sales $1,640,554 $1,330,150
Net Earnings 109,919 59,696
Earnings per share $ 1.84 $ 1.02
In 1994, the Company acquired Delta Consolidated
Industries,
Hengstler GmbH, Armstrong Brothers Tool Company and
several
smaller entities. Aggregate consideration for these
transactions
was approximately $167 million, consisting of $136
million in cash
and $31 million in common stock. The fair value of the
assets
acquired was approximately $240 million and
approximately $73
million of liabilities were assumed in these
acquisitions. The
transactions have been accounted for as purchases.
These
acquisitions had no significant impact on 1994 results
of
operations as the larger acquisitions were not completed
until the
fourth quarter. These entities have combined annual
sales levels
of approximately $220 million.
In 1993, the Company acquired certain businesses
for its
process/environmental controls segment. Annual sales
levels of
the acquired businesses are approximately $65 million.
The
transactions have been accounted for as purchases.
(3) Inventory:
The major classes of inventory are summarized as
follows
(000's omitted):
December 31, 1995
December 31, 1994
Finished goods. . . . .
. . . . . . . . .
$ 89,932
$69,232
Work in process. . . . .
. . . . . . . .
51,904
31,799
Raw material . . . . . .
. . . . . . . . .
60,054
33,910
$ 201.890
$134,941
If the first-in, first-out (FIFO) method had been used
for
inventories valued at LIFO cost, such inventories would
have been
$12,167,000 and $12,096,000 higher at December 31, 1995
and 1994,
respectively.
(4) Property, Plant and Equipment:
The major classes of property, plant and equipment
are
summarized as follows (000's omitted):
December 31, 1995
December 31, 1994
Land and improvements .
. . . . .
$ 15,015
$ 9,309
Buildings . . . . . .. .
. . . . . . . . . . .
93,312
76,920
Machinery and equipment.
. . . .
352,176
291,675
460,503
377,904
Less accumulated
depreciation..
(168,566)
(133,737)
Property, plant and
equipment..
$ 291,937
$244,167
(5) Financing:
Financing consists of the following (000's
omitted):
December 31, 1995
December 31, 1994
Notes payable . . . . .
. . . . . . . . .
$115,300
$130,000
Bank credit facility. .
. . . . . . . . .
-
-
Other . . . . . . . . .
. . . . . . . . . . . .
168,287
55,286
283,587
185,286
Less-currently payable.
. . . . . . .
14,970
68,771
$ 268,617
$116,515
The Notes had an original average life of
approximately 6.5
years and an average interest cost of 7.2%. Principal
amortization began in December 1995 and continues
through April
2003. The estimated fair value of the Notes is $120
million and
$123 million as of December 31, 1995 and 1994.
Other includes principally short-term borrowings
under
uncommitted lines of credit which are payable upon
demand. The
carrying amount approximates fair value. Substantially
all other
debt was repaid subsequent to year-end with the $155
million
proceeds from the sale of Fayette Tubular Products.
The Company's bank credit facility provides for
revolving
credit through November 1, 2000, of up to $250 million.
The
Company has complied with covenants relating to
maintenance of
working capital, net worth, debt levels, interest
coverage, and
payment of dividends applicable to the notes and the
revolving
credit facility. The facility provides funds for
general
corporate purposes at an interest rate of LIBOR plus
.1875%. The
weighted average interest rate for variable rate debt
was 6.0%,
5.1%, and 3.8% for each of the three years ended
December 31,
1995. Weighted average borrowings under the bank
facility were
$5,000,000, $2,986,000, and $48,886,000 for the years
ended
December 31, 1995, 1994 and 1993. Maximum amounts
outstanding for
these years were $60,000,000, $33,525,000, and
$79,000,000
respectively. The Company is charged a fee of .1% per
annum for
the facility. Commitment and facility fees of $216,000,
$258,000,
and $521,000 were incurred in 1995, 1994 and 1993.
Interest
expense of $7,150,000, $6,112,000 and $4,984,000 is
included in
discontinued operations for the years ended December 31,
1995,
1994 and 1993.
The minimum principal payments during the next five
years
are as follows: 1996 - $14,970,000; 1997 -
$14,847,000; 1998 -
$14,835,000; 1999 - $41,335,000; 2000 - $167,060,000 and
$30,540,000 thereafter.
(6) Accrued Expenses and Other Liabilities:
Selected accrued expenses and other liabilities
include the
following (000's omitted):
December 31, 1995
December 31, 1994
Employee compensation . . . .
. . . . . . . .
$60,655
$39,831
Insurance including self
insurance . . . . .
49,961
40,797
Post retirement benefits. . .
. . . . . . . . . .
76,844
60,897
Environmental compliance . . .
. . . . . . .
88,212
11,570
Approximately $23 million of accrued expenses and
other
liabilities were guaranteed by bank letters of credit.
(7) Pension and Employee Benefit Plans:
The Company has noncontributory defined benefit
pension
plans which cover certain of its domestic hourly
employees.
Benefit accruals under most of these plans have ceased
as of
December 31, 1995. It is the Company's policy to fund,
at a
minimum, amounts required by the Internal Revenue
Service. Net
periodic pension cost included the following components:
PENSION EXPENSE
(000's omitted)
1995
1994
1993
Service cost-benefits earned during the
period. . . . . . . . . .
$ 181
$1,209
$1,079
Interest cost on projected benefit
obligation. . . . . . . . . . . .
7,330
5,633
5,947
Actual (return) loss on plan assets . . . .
. . . . . . . . . . . . . . .
(20,175)
690
(9,079)
Net amortization and deferrals. . . . . . .
. . . . . . . . . . . . . . .
12,866
(7,119)
2,901
Net periodic pension cost. . . .
. . . . . . . . . . . . . . . . . .
$ 202
$ 413
$ 848
The following sets forth the funded status of the
plans as
of the most recent actuarial valuations (000's
omitted):
1995
1994
Assets
Exceed
Accumulate
d
Benefits
Accumulated
Benefits
Exceed
Assets
Assets
Exceed
Accumulate
d
Benefits
Accumulated
Benefits
Exceed
Assets
Actuarial present value of benefit
obligations:
Vested benefit obligation. . . . . . .
. . . . . . . . . . . . . . . . .
Accumulated benefit obligation. . . .
. . . . . . . . . . . . . . .
$(58,595)
(59,516)
$(57,042)
(59,649)
$(15,459)
(15,696)
$(56,480)
(56,966)
Projected benefit obligation. . . . . . . .
. . . . . . . . . . . . . . . .
(59,516)
(59,649)
(15,696)
(56,966)
Fair value of plan assets (consisting of
stocks, bonds and
temporary cash investments). . . . . .
. . . . . . . . . . . . . . .
72,969
56,240
16,781
53,776
Projected benefit obligation (in excess of)
or less than
plan assets. . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . .
13,453
(3,409)
1,085
(3,190)
Unrecognized net (gain) loss. . . . . . . .
. . . . . . . . . . . . . . .
(4,120)
2,919
800
1,243
Unrecognized prior service cost. . . . . .
. . . . . . . . . . . . . . .
-
-
640
1,019
Unrecognized net asset . . . . . . . . . .
. . . . . . . . . . . . . . . .
(605)
(1,269)
(975)
(1,218)
Pension (liability) prepaid recognized in
the balance
sheet. . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
.
$ 8,728
$ (1,759)
$1,550
$(2,146)
The expected long-term rate of return on plan assets was
10%. The discount rates
used in determining pension cost and benefit obligations was
8.5% at January 1, 1995 and
7.5% at December 31, 1995.
Substantially all employees not covered by defined
benefit plans are covered by
defined contribution plans which generally provide funding
based on a percentage of
compensation.
Pension expense for all plans amounted to $11,870,000,
$8,677,000, and $8,023,000
for the years ended December 31, 1995, 1994 and 1993,
respectively.
In addition to providing pension benefits, the Company
provides certain healthcare
and life insurance benefits for some of its retired
employees. Certain employees may
become eligible for these benefits as they reach normal
retirement age while working for
the Company.
Post retirement benefits cost included the following
components (000's omitted):
1995
1994
1993
Service cost . . . . . . . . . . .
. . . . . . . . . . . . . . .
$ 298
$ 256
$ 222
Interest cost . . . . . . . . .
. . . . . . . . . . . . . . .
4,734
3,995
4,566
$5,032
$4,251
$4,788
The following sets forth the program's funded status
(000's omitted):
December 31, 1995
December 31, 1994
Accumulated Post Retirement
Benefit Obligation
(APBO):
Retirees. . . . . .
. . . . . . . . . . . . .
.
Fully eligible active
participants. .
Other active
participants. . . . . . . .
.
$52,788
10,840
11,265
$40,419
6,733
4,205
Total APBO
74,893
51,357
Net Gains
1,951
9,540
Plan assets
-
-
Accrued Liability
$76,844
$60,897
A 10% annual rate of increase in per capita costs of
covered healthcare benefits was
assumed for 1996, decreasing to 6% by 2002. A 1% increase in
the assumed cost trend
assumption would increase the APBO by $8 million and would
have increased 1995 costs by
approximately $500,000. A discount rate of 8.5% was used as
of January 1, 1995. A
discount rate of 7.5% was used to determine the APBO as of
December 31, 1995.
(8) Stock Transactions:
The Company has adopted a non-qualified stock option
plan for which it is authorized
to grant options to purchase up to 3,600,000 shares. Under
the plan, options are granted
at not less than 85% of existing market prices and expire ten
years from the date of
grant. An option to acquire 1,000,000 shares was granted to
a senior executive outside of
the plan in 1990.
Changes in stock options were as follows:
Number of Shares
Under Option
Outstanding at January 1,1993
2,165,176
Granted (average $16.40 per share)
1,072,200
Exercised (average $7.23 per share)
(100,312)
Cancelled
(91,688)
Outstanding at December 31, 1993
3,045,376
Granted (average $23.06 per share)
456,100
Exercised (average $8.38 per share)
(58,774)
Cancelled
(41,600)
Outstanding at December 31, 1994
3,401,102
Granted (average $30.71 per share)
383,300
Exercised (average $9.54 per share)
(208,006)
Cancelled
(136,520)
Outstanding at December 31, 1995
3,439,876
As of December 31, 1995, options covering 2,075,576
shares are exercisable at $5.94
to $31.00 per share.
(9) Leases and Commitments:
The Company's leases extend for varying periods of time
up to 10 years and, in some
cases, contain renewal options. Future minimum rental
payments for all operating leases
having initial or remaining noncancelable lease terms in
excess of one year are
$12,037,000 in 1996, $7,709,000 in 1997, $5,587,000 in 1998,
$3,569,000 in 1999, and
$1,978,000 in 2000. Total rent expense charged to income for
all operating leases was
$16,067,000, $8,947,000, and $10,047,000 for the years ended
December 31, 1995, 1994, and
1993, respectively.
(10) Litigation and Contingencies:
A former subsidiary of the Company is engaged in
litigation in multiple states with
respect to product liability. The Company sold the
subsidiary in 1987. Under the terms
of the sale agreement, the Company agreed to indemnify the
buyer of the subsidiary for
product liability related to tools manufactured by the
subsidiary prior to June 4, 1987.
The cases involve approximately 3,000 plaintiffs, in state
and federal courts in multiple
states. All other major U.S. air tool manufacturers are also
defendants. The gravamen of
these complaints is that the defendants' air tools, when used
in different types of
manufacturing environments over extended periods of time,
were defective in design and
caused various physical injuries. The plaintiffs seek
compensatory and punitive damages.
The cases are in preliminary stages of discovery and pleading
and the Company intends to
defend its position vigorously. The Company's maximum
indemnification obligation under
the contract is approximately $85,000,000. The Company
believes it has insurance coverage
for all or a substantial part of the damages, if any. The
outcome of this litigation is
not currently predictable.
A subsidiary, Joslyn Manufacturing Company (JMC),
previously operated wood treating
facilities that chemically preserved utility poles, pilings
and railroad ties. All such
treating operations were discontinued or sold prior to 1982.
These facilities used wood
preservatives that included creosote, pentachlorophenol and
chromium-arsenic-copper.
While preservatives were handled in accordance with all
appropriate procedures called for
at the time, subsequent changes in environmental laws may
require the generators of these
spent preservatives to be responsible for the cost of
remedial actions at the sites where
spent preservatives have been deposited. The Company is
continuing its investigation of
these sites and remediation technologies. The Company has
made a provision for
environmental compliance; however, there can be no assurance
that estimates of
environmental liabilities will not change.
JMC is a defendant in a class action tort suit. The
suit alleges exposure to
chemicals and property devaluation resulting from wood
treating operations previously
conducted at a Louisiana site. Both the size of the class
and the damages are uncertain.
The Company has tendered the defense of the suit to its
insurance carrier. The Company
believes that it may have adequate insurance coverage for the
litigation; however, because
of the above uncertainties, the Company is unable to
determine at this time the potential
liability, if any.
In addition to the litigation noted above, the Company
is from time to time subject
to routine litigation incidental to its business. These
lawsuits primarily involve claims
for damages arising out of the use of the Company's products,
some of which include claims
for punitive as well as compensatory damages. The Company is
also involved in proceedings
with respect to environmental matters including sites where
the Company has been
identified as a potentially responsible party under federal
and state environmental laws
and regulations. The Company believes that the results of
the above noted litigation and
other pending legal proceedings will not have a materially
adverse effect on the Company's
financial condition.
A subsidiary of the Company has sold, with limited
recourse, certain of its accounts
and notes receivable. A provision for estimated losses as a
result of the limited
recourse has been included in accrued expenses. No gain or
loss arose from these
transactions.
(11) Income Taxes:
The provision for income taxes for the years ended
December 31 consists of the
following (000's omitted):
1995
1994
1993
Federal. . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . .
. .
$56,308
$40,297
$28,367
State and local.. . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . .
6,815
5,400
3,800
Foreign. . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . .
.
4,170
3,210
1,500
$67,293
$48,907
$33,667
Income tax expense currently payable was $73,225,000,
$70,865,000, and $46,140,000
for the years ended December 31, 1995, 1994 and 1993,
respectively.
Deferred income taxes are reflected in prepaid expenses
and other current assets and
in other assets. Deferred tax assets (the valuation
allowances relate to foreign
jurisdictions where operating loss carryforwards exist and
for capital loss carryforwards)
consist of the following (000's omitted):
December 31,
1995
1994
Bad debt allowance . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
$ 4,681
$ 4,100
Inventories . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . .
(926)
1,700
Property, plant and equipment . . . . . . . . . .
. . . . . . . . . . . . . .
(25,395)
(20,900)
Post retirement benefits. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . .
28,405
21,300
Other accruals . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
86,727
46,700
All other accounts . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . .
(3,840)
1,500
Operating loss carryforwards . . . . . . . . . .
. . . . . . . . . . . . . . .
7,000
800
Capital loss carryforwards. . . . . . . . . . . .
. . . . . . . . . . . . . . . .
0
1,300
Gross deferred tax asset. . . . . . . .. . . . .
. . . . . . . . . . . . . . . . . .
96,652
56,500
Valuation allowances. .. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . .
(7,000)
(2,100)
Net deferred tax asset . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
$ 89,652
$54,400
The effective income tax rate for the years ended
December 31 varies from the
statutory Federal income tax rate as follows:
Percentage of Pre-Tax Earnings
1995
1994
1993
Statutory Federal income tax rate. . . . . . . .
. . . . . . . . . . . . . . . . .
35.0%
35.0%
35.0%
Increase (decrease) in tax rate resulting from:
Permanent differences in amortization of
certain assets for
tax and financial reporting purposes. . .
. . . . . . . . . . . . . . . .
2.9
2.8
3.7
State income taxes (net of Federal income
tax benefit).. . . . .
2.6
2.9
3.0
Taxes on foreign earnings. . . . . . .. .
. . . . . . . . . . . . . . . . . . . .
(1.6)
(0.4)
(0.5)
Effective income tax rate. . .. . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
38.9%
40.3%
41.2%
(12) Segment Data:
As of December 31, 1995 the Company operated within two
major business segments:
Tools and Components, and Process/Environmental Controls.
The Tools and Components
segment has a customer which accounted for approximately 16%,
21% and 21% of total sales
in 1995, 1994 and 1993, respectively.
Operating profit represents total revenues less
operating expenses, excluding
interest and taxes on income. The identifiable assets by
segment are those used in each
segment's operations. Intersegment receivables are
eliminated to arrive at consolidated
totals.
The detail segment data is presented in the following
table (000's omitted):
Operations in Different Industries -
Year Ended December 31,
1995
1994
1993
Total Revenues:
Tools and Components
Process/Environmental Controls
Other
$1,005,005
481,764
-
$1,486,769
$
809,989
303,984
-
$1,113,973
$
691,344
244,400
1,889
$937,633
Operating Profit:
Tools and Components
Process/Environmental Controls
Other
$ 112,981
80,804
(13,528)
$ 180,257
$
81,463
56,632
(13,668)
$
124,427
$
56,443
42,781
(12,166)
$ 87,058
Identifiable Assets:
Tools and Components
Process/Environmental Controls
Other
$ 821,604
599,466
64,921
$1,485,991
$
687,908
340,952
76,785
$1,105,645
$
550,169
240,712
51,413
$
842,294
Depreciation and Amortization:
Tools and Components
Process/Environmental Controls
$ 35,211
23,316
$ 58,527
$
32,220
10,334
$
42,554
$
29,562
8,835
$
38,397
Capital Expenditures:
Tools and Components
Process/Environmental Controls
Sales of Fixed Assets
$ 48,500
10,672
-
$ 59,172
$
40,392
8,348
(13,929)
$
34,811
$
28,133
5,242
-
$
33,375
Operations in Geographical Areas -
Year Ended December 31,
1995
1994
1993
Total Revenues:
United States. . . . . . . . . . .
. . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
.
Other. . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
. .
$1,235,933
205,228
45,608
$1,486,769
$1,004,697
77,126
32,150
$1,113,973
$ 854,267
52,195
31,171
$ 937,633
Operating Profit:
United States. . . . . . . . . . .
. . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
.
Other. . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
. .
$ 156,170
20,348
3,739
$ 180,257
$ 115,589
7,179
1,659
$ 124,427
$ 81,207
3,568
2,283
$ 87,058
Identifiable Assets:
United States. . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
.
Other. . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
. .
$1,292,166
173,949
19,876
$1,485,991
$1,029,825
62,833
12,987
$1,105,645
$ 776,421
51,246
14,627
$ 842,294
Export sales were approximately $107 million, $91 million and
$75 million for the years
ended December 31, 1995, 1994 and 1993.
(13) Quarterly Data-Unaudited (000's omitted except per
share data)
1995
1st Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
Net revenues. . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
$335,982
$351,891
$368,724
$430,172
Gross profit. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
96,707
107,967
111,110
131,363
Operating profit. . . . . . . . . .
. . . . . . . . . . . . . . . . .
36,838
45,709
47,094
50,616
Earnings from continuing operations.
. . . . . . . . . .
21,412
26,640
28,348
29,366
Earnings from discontinued operations
. . . . . . . . .
436
580
452
1,082
Net earnings. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
21,848
27,220
28,800
30,448
Earnings per share:
Continuing operations
Discontinued operations
Net earnings
$ .36
.01
$ .37
$ .45
.01
$ .45
$ .47
.01
$ .48
$ .49
.02
$ .51
1994
1st Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
Net revenues. . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
$246,224
$270,418
$284,806
$312,525
Gross profit. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
67,792
77,892
87,265
89,150
Operating profit. . . . . . . . . .
. . . . . . . . . . . . . . . . .
21,712
27,920
36,720
38,075
Earnings from continuing operations .
. . . . . . . . .
12,200
15,859
21,555
22,705
Earnings from discontinued operations
. . . . . . . . .
2,328
3,407
1,543
2,053
Net earnings. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
14,528
19,266
23,098
24,758
Earnings per share:
Continuing operations
Discontinued operations
Net earnings
$ .21
.04
$ .25
$ .27
.06
$ .33
$ .37
.03
$ .40
$ .39
.04
$ .42
Danaher Corporation and Subsidiaries
Operating Executives
Danaher Controls
James W. Appelgren
President
A.L. Hyde Company
Richard L. Garthwaite
President
Iseli Company
Oege Luiting
President
Jacobs Vehicle Equip-
ment Company
Gregory T.H. Davies
President
Jacobs Chuck Manu-
facturing Company
Dennis D. Claramunt
President
Matco Tools Corporation /
Hennessy Industries, Inc
Patrick W. Allender
Acting President
Partlow Corporation/
Anderson Instrument
Company
Lawrence C. Curtis
President
Qualitrol Corporation
Alex A. Joseph
President
Delta Consolidated
Industries
Thomas P. Joyce, Jr.
President
Hengstler GmbH
Hermann E. Braun
President
Veeder-Root Company
H. Lawrence Culp, Jr.
President
Danaher Tool Group
Professional Tools
Division
Frank J. Feraco
President
Danaher Tool Group
Special Markets Division
Thomas R. Sulentic
President
Gulton-Graphic Instruments
William H. Brewster
President
West Instruments, Ltd.
Philip R. Sheridan
Managing Director
Jennings Technology
Corporation
James E. Berkeland
President
Cyberex, Inc.
Gus Stevens
President
Joslyn Manufacturing
Company
Gary P. Prasser
President
Joslyn Hi-Voltage
Corporation
James F. Domo
President
Joslyn Sunbank Corporation
P. Edward Prutzman
President
Joslyn Electronic Systems
Corporation
S. Keith Swanson
President
Officers and Senior
Executives
George M. Sherman
President and Chief
Executive Officer
Patrick W. Allender
Senior Vice President
Chief Financial Officer
and Secretary
C. Scott Brannan
Vice President -
Administration
and Controller
Dennis D. Claramunt
Vice President and Group
Executive
H. Lawrence Culp, Jr.
Vice President and Group
Executive
Gregory T.H. Davies
Vice President and Group
Executive
James H. Ditkoff
Vice President -Finance &
Tax
John P. Watson
Vice President and
Group Executive
Directors
Mortimer M. Caplin
Partner
Caplin & Drysdale
Donald J. Ehrlich
President
Wabash National Corp.
Walter G. Lohr, Jr.
Partner
Hogan & Hartson
Mitchell P. Rales
Partner
Equity Group Holdings
Chairman of the Exec-
utive Committee
Danaher Corporation
Steven M. Rales
Partner
Equity Group Holdings
Chairman of the Board
Danaher Corporation
George M. Sherman
President and Chief
Executive Officer
Danaher Corporation
A. Emmet Stephenson, Jr.
President
Stephenson and Company
Auditors
Arthur Andersen LLP
Washington, D.C.
Shareholders' Information
Shareholder requests for information or assistance,
please write or call our corporate office.
Danaher Corporation
c/o Investor Relations
1250 24th Street, N.W. Suite 800
Washington, D.C. 20037
(202) 828-0850
Stock Listing
Symbol: DHR
New York and Pacific Stock Exchanges
Transfer Agent
Chemical Mellon Shareholder Services, LLC
Pittsburgh, Pennsylvania
Form 10-K
A copy of the Annual Report to the Securities and Exchange
Commission
on Form 10-K may be obtained by writing to Danaher
Corporation
MARKET PRICES OF COMMON STOCK
1995
1994
High
Low
High
Low
First Quarter . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . .
29 7/8
24 1/4
20 1/4
18
Second Quarter . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
32
26 3/8
21 7/8
18
5/16
Third Quarter. . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
34 3/8
30 1/4
23 1/2
20 15/16
Fourth Quarter. . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
33 1/4
30 1/4
26 9/16
21
5/8
High and low per share data are as quoted on the New York
Stock Exchange.