DHR - Earnings call transcript Q1 2022

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Operator

Good day. My name is Leo and I will be your conference facilitator this morning. At this time, I would like to welcome everyone to Danaher Corporation’s First Quarter 2022 Earnings Results Conference Call. [Operator Instructions] I will now turn the call over to Mr. John Bedford, Vice President of Investor Relations. Mr. your begin may you conference. Bedford,

John Bedford

point Matt and Good the and joining Vice SEC and to on our that for to measures non-GAAP Regulation With morning, supplementing Chief G like slide and us Financial Officer; provided our under call President everyone heading of call. our portion section replay and and today later us other earnings the financial archived the Earnings. Blair, the call Executive relating A thanks are are Chief during our McGrew, be and I’d & Executive the all reconciliations also the Investors website information President audio Investors of presentation this our out today Rainer our Officer. release, heading today’s required call available by section of available XXXX. the of The quarterly under X, next until will will May the on this call. call website, archived Events www.danaher.com, until be Presentations on will remain Quarterly any

significant presentation, submitted year-over-year. applications first certain more markets. certain may otherwise have also in that relate year-over-year all all supplemental XXXX or products and Unless or pending references are devices are and financial regulatory we describe these impacted quarter materials, approvals materials which metrics We only in that of decreases describe the to for period-to-period additional in remarks of available references will financial increases impacted performance. performance. and the certain certain company’s the factors specific noted, the describe to year-over-year During Supplemental factors metrics and

materially within that laws, to SEC or statements future. set differ make statements These will or any forth might by our that like number except over regarding including federal of to that that, in believe the forward-looking date our and may we from the we a meaning and including of call, forward-looking actual the the filings any are any the we subject uncertainties, to in obligation are statements make risks only those do or events developments statements, forward-looking to will occur assume today. anticipate forward-looking they and we statements results I’d During With These law. the statements turn as required speak call made of Rainer. update forward-looking as not securities

Rainer Blair

Well, everyone. morning thank We you and the you, good us call today. joining appreciate on John

good to a ahead cash growth initial our start first We single-digit was core with deliver in with environment three in high And in each our coming are our quarter revenue, challenging of operating earnings strong a broad-based navigated performance revenue segments. or team better The off to growth. and the XXXX of expectations. flow

in capacity, high-impact market share investments Now quarter, advantage to strengthen innovation we during both the first through we our gains. which are and believe growth bio-processing of production competitive continued contributing to

markets with end secular Danaher it’s provides combination differentiates well-rounded our exceptional the foundation Danaher powered this all just team’s durable strong clearly, testament that attractive results future. continuous positioning are by and the drivers We unique System to Business a collection Now, the of portfolio. have really for and to commitment our growth an businesses, serve that and our improvement of today to a

first core let’s first in that, revenue delivered quarter growth. Sales and with were billion of results. the So turn $X.X to we our quarter XX%

year. first delivered March The out in markets while lockdowns called and with very single-digits. X%. our had in the impact Europe in U.S. prior base the strength single-digits, testing broad-based of high China X% declined impact were up significant both single-digits, late portfolio revenue modest mid-teens, the COVID-XX Geographically, high-growth across a and China. grew and that excluding low on low up the project was up driven previously COVID-XX Our a bioprocessing but was quarter business began Western results contributing in

more ease in levels eventual are to However, weeks into we April, the an by of with will further of impact to in begin activity extend our return as coming anticipate the normalized businesses. lockdowns June. an these seeing end the And situation we

gross first was exchange foreign mix, decline basis Our year-over-year XX.X%. margin largely Sciences to of The primarily the and operating segment. profit XX Life changes margin for product our in points to is within XX.X% currency quarter due rates

versus we diluted flow in $X.X adjusted common $X.XX generated of share last quarter. net Now, X.X% and billion the of free were earnings cash per up year

on in So, color and give take our end portfolio seeing what now today. let’s a look are markets results our across you the we some at

in segment. Let’s Core grew very revenue across impact start the their of are our to low high last seeing orders remain one-time revenue China year. with core both strength healthy and up we with in in Life bioprocessing In business broad-based robust and the bioprocessing, research quarter. modalities. revenue at excluding was across Customers double-digits, are the reported Cytiva accelerating production levels. X.X% significant continued that backlog across during Biotech very businesses therapeutic activity and single-digits all up Sciences Pall project we investments grew was build and major X.X% The where and

of starting therapies mature investment the over customers support time standard capacity they core to diseases. modalities, of they or monoclonal part are capacity our in clinical programs many care X the cell new investment and therapies customers’ are area the business. largest are And for these helping markets. more the a In in Today, and become paused adding treatment reallocate accelerate of to development antibody-based therapies increasing our as higher our the back and life-saving less a development notably gene result, for and as programs becoming manufacturing and both to and as require bioprocessing to This are in customers technologies. rapid in making of rapidly manufacturing previously years, treatment. Biosimilar patents MAB accessible Customers trials expire. our underserved accelerate Now MABT of on to resources antibodies the volume COVID-XX monoclonal novel production today, other growth is mRNA-based as customers also and prioritized approved adoption therapies are market. and trend treatments last vaccine to their

Cardiff, continue expansion in of customers help we capacity manufacturing Now, key development enablers been of online to and the An biologic which area quarter, our bioprocessing. has first our make medicines. single-use came and manufacturing important this meet manufacturing dedicated focus demand accelerating scale our technology to to with of plan to substantial investments in In newest in Wales. genomic-based single-use are technology the

they for fastest one demand opened and growing categories Carolina facilities within Now, of additional South this bioprocessing. are support today. critical provide product recently capacity the Long-term, along Beijing to in plant, our with customers’

end and IDT Demand So Sciences activity at of XX%. a Leica is growth Instrument another the leveraging learning projects. wide initiation integrates while simplify Leica workflow field Quad businesses, robust first innovation turning great we customers. investments imaging to XXXX Microsystems, dramatically market CRO instrument and seeing continue grew particularly automation to share example markets. healthy our researchers. are funding to and over a the Mica gains pharmaceutical and the our accelerating for At the Mica our imaging our and machine for In are single SCIEX in confocal our of of At research all are innovation of Life major SCIEX, new customers in perform is quarter, academic in and is well trajectory. levels each environment and how ZenoTOF impactful our driving where enhancing Microsystems, strong examples XXXX Triple

and part our to as So customers delivering meaningful in a the over investing to the first work. strengthen joining continued sciences Recently Aldevron focused Danaher, start putting position. of and innovation embraced life clearly, has on completed the tools solutions XX% bring throughput its reducing generating results. across to in terrific times portfolio, Danaher to are Danaher growth our competitive quarter. in we Business are Kaizen team event Since System DBS increasing further August, late already lead is the which great

we So the great the is excited doing. Aldevron thrilled early are the team progress work with and at about

revenue reported growth and was XX.X% let’s led So up Diagnostics, by revenue to move where XX% XX.X% Cepheid. now at over core grew

in single-digits. Leica remain consecutive grew of as geographies checks, levels for patients healthy most digital businesses returning pathology. procedures. Biosystems are collectively elective their diagnostics strength volumes and The clinical delivered order at diagnostic histology, staining wellness non-COVID double-digit mid by in other core clinical Our quarter growth market driven routine Notably, and seventh advanced screenings

through effectively managing healthcare services. are their protocols allowing them outbreaks customers by procedures and providing continue periodic Our adapting critical to

be Now most the volumes have expect testing in the subsided in moderated most to second in regions. has outbreak Omicron lockdowns Diagnostics, as China, effective impact regional seeing Diagnostics respiratory we are quarter. the Molecular our business In and volumes globally patient currently we

and strong point are However, care we demand the share. very testing for of taking Cepheid at believe market we remains

a lab of clinicians a testament are of gains growth providing best-in-class workflow value continued to is unique care. accurate the and and combination point fast, the the Our share to significant results at

expanding disease moves for infectious COVID-XX hospital-acquired expressing Cepheid’s utilization. menu increased purchased disease towards our in initially Customers, we led demand their for urology non-respiratory seeing as increased grew by broader and menu. testing. several system infection, testing quarter, are the In So, revenue first interest test including endemic who GeneXpert an COVID-XX are double-digits, state, testing,

free broader testing base for leverage to point-of-care customers market molecular are utilization from testing drive our demand respiratory believe capacity menu and As installed we opportunities to significant testing, our leading and Cepheid’s there solutions.

increased the of for exceeded quarter expectations revenue X-in-X preference during customers respiratory combination in Now, an Cepheid’s the respiratory season. testing our $XXX test showed million as

for XX% cartridges quarter tests Our XX accounting A, million combination Flu RSV the approximately B represented and test the shipped approximately with XX%. for Flu of COVID-only in COVID-XX, respiratory

The Applied quality now, quality, rate by its remained at reported At to of revenue demand consumables move municipal, identification. where mid including & beverage and product invest municipal larger consecutive grew growth single-digit up customers as Environmental X.X%, are order with in continuing for to analytical revenue and strong water Difficulty] driven So [Technical was chemistries double-digit Solutions chemical, end across activity delivered equipment our X.X% market. projects. accelerating ChemTreat fourth core food let’s segment, water our and quarter growth, core also

decline Identification, was and up business. and food, by Videojet color high coding beverage was end marking and markets. our management business our demand Now packaging single-digits partially in up high with offset Product single-digits slight strong in industrial

So of stepping the and improve growth Danaher leveraging done job product identification cost an water a perspective. back, from System Business have their both positioning exceptional and our platforms to quality

than our tools DBS pronounced more modestly been as with work EAS, have production pressures component teams chain to and such ensure using are daily suppliers supply management While availability.

management focus to visual cost-effective chipsets. a using project to also to component our help faster products reengineer difficult more are us on newer, next-generation from electronic moving with We source

believe of we us many to enables and DBS our more reliably than competitors. deliver Now, faster

helping from And solve the are growth face we as skilled the market, and seeing to customers XXXX to annually to more solutions are growth, HQ tools also series over portable which the such Now, are our meters, averaged accelerate printer using single-digits past innovations impact many challenges impactful years CIJ teams our DBS labor deliver and innovation they Videojet, core shortages. regulatory increasing XX the at mid EAS. has our requirements in HACH’s

our So with combination meaningful is application our of we this and proactive rigorous competitive of share paired growth DBS gains enhancing investment believe long-term advantage. tools, the market driving

our approximately the for In ongoing year. China. So we XXX ahead shutdowns now, a points to related COVID-XX deliver XXX includes full to quarter the let’s the from expectations which base basis headwind briefly second growth business, single-digit of in in expect second core look our revenue quarter, to mid and the

in high normalize there single-digit move remainder of no our For expect of as base guidance the year business we in our full as China shutdowns XXXX, the growth to change is core we through year. revenue to the the previous

growth. COVID-XX and single-digit from expect headwind to growth mid-single-digit both a continue revenue overall core testing We low core

good move up, on to and a to we as start through the look XXXX. to foundation wrap So we forward had building year this

with operating Our represent dedication environment. commitment of to these team of us businesses collection in of revenue, exceptional a System. today. reflect And results outstanding XX% well unique their first that franchises executing are positions consumables Business where the durability the believe now Danaher today’s and the our high-quality testament exceptionally of We positioning and dynamic comprise results our also of quarter Danaher our the to portfolio the

and powerful reinforces this So talented of strength and advantage. sustainable, team, our the of Danaher long-term portfolio combination competitive Business differentiates Danaher our our the System

So turn with that, John. over call I’ll you, to back the

John Bedford

Leo, questions. ready our concludes comments. That now Rainer. we’re Thanks, for formal

Operator

Bruin Instructions] [Operator De America. will Derik of from question take of Bank We first our

Rainer Blair

morning. Hi, Derik. Good

Derik De Bruin

of Hi, my sort good for a like from clients. got morning. couple incoming I taking question. Thanks just of

at I a think on all, XX. little and more XX bit think, on just – came the first in difference you the of it I Cepheid mentioned guide, million between

there? vendors difference on And on follow-up. a or Just I’ve think more the any I sort either bit stockpiling also side? you terms And question, the of of for either color related diagnostics are in little just more bioprocessing volume a got seeing

Rainer Blair

shipments in first Thanks, Derik. plant. suffered some Well, cartridge one We the the And absenteeism hand. start the in from that levels the the as production our let’s to the manufacturing quarter, in affected off related here with many. quarter. Omicron Early on outbreak

X-in-X towards of ended the in in On other shift, assumption XX% mix larger test, beat the the our versus up than revenue. hand, a of terms anticipated XX% resulting

recovery So short-term affected cartridges the mix up strength the resulting really contained the the issue in that ended XX a volumes, team’s ultimately, manufacturing of and million of shipment.

to topic we this switch go topic to we of close very our sensitive extremely customers. gears particular briefly and stay the very, if Now and stockpiling, are with

continues be quarter, first the sold out. in example, an Cepheid As to

is the this there constraints. an where manufacturing about bioprocessing be you If industry to area in continues think

close them able system. their with together manufacturing to customers, are that we’re we to meet ensure buildup very, So schedules with to also very inventory that not we needs working only but to in the don’t their have ensure our

So could don’t see we the on that in but of a supply generally speaking, be pockets chain. significant the there buildup margin, perhaps

Derik De Bruin

points, China Great. the to XX in can basis quarter, demand? that just on headwind supply the you versus XX And what’s

Rainer Blair

is customers. of related this entirely supply accessibility Well, to

be the to So in robust. China very demand continues

have prior the first single up China very may the in you for As digits – project this noted, quarter strong. was large in orders without high us, without year, the

the course, the or manufacturing these other in related really is that’s plant labs of affected this customer by in and one accessibility hospitals, So shutdowns. to

and today, to those open our team open well would so to well we of get surely, we’re as to more as receiving throughout here back here we’re client as sit slowly as then that expect improve are just up not already I’m news Now plant, the we quarter the from lab end but already able normal the levels as up and starting the accessibility sorry, quarter. well May as by to – in here our

Derik De Bruin

done. one think in, expected that. hit, more China expect Great. growth the nice all it? year see And other sneak reiterating I regions Is come stronger am business you with back? can full that see XQ in to as that Or if you Thank I you’ll the you offsetting guide to do you.

Rainer Blair

makeup is as plants normal said think our and about activity we both up large is period. short mostly capacity a for one, pockets back China make to that will getting to are relatively what This as grow that, is levels faster. shutdown and customers well always having the there Having the business

So between year the guide confident holds. the our two full things, for we that feel

Operator

will Kumar ISI. take We Vijay from question next Evercore of our

Rainer Blair

morning, Good Vijay.

Vijay Kumar

of guiding their a I lot of vaccine solid Congrats J&J the Obviously, bioprocessing. But Rainer. is on Rainer, base one and been vaccine questions not side. pull the base. on morning, know a Good print. there are QX it’s part I on anymore. guidance. guess They side Not Maybe yesterday, news to out did the vaccine. vaccine

talk in bioprocessing outlook queue. about the still revenues? of trends above fiscal trends about ‘XX? vaccine confident order were you What maybe And the were for orders are X the So just billion

Rainer Blair

Well, thanks, Vijay.

was So let’s up very a shipment I’ll strong set we very during here our in as we in minute. briefly numbers opening QX. China, about last just and low extract the bioprocessing activity, here. come business back commentary, QX, bioprocessing QX think digits that to I Very, on level year mentioned double If that large in my order and

up year, quarter our Now if over sales look at you XX%. last were our first

you representative think what robust of area, we’re look think which we XX% in is that, on compares and the that and to well. is the the market than QX, at very X-year extremely And if more going in so growth for stack XX%

In fact, we we’re there. still think that share taking

up then of that the very, quarter I the strong. to sort And be you one orders were XX%. over order that’s first marker second year, is activity in want So have. to very continues Last point the our

so area. anticipated that well our to year that confident and is important. high between we’re that backlog backlog be that’s the this why this digit, growth but down And would in nonetheless, year here the so for our continue the QX as digits bioprocessing have, here seeing we in in and the single bioprocessing we’re And of growth really we in we low double guide core of QX orders build robust

incredibly there and So a what’s now that are sort are here growth why that about going explain important one COVID about let’s unpack in and the little bioprocessing but and variables business bit aggregate. that on why think variable, we its talk and is of other

COVID about it’s going for activity was is this, business, all, So the years what’s in I’ve of than outside And see the larger think XX% that levels on know antibodies you first but the of project monoclonal clinical ago. talked you trials. bioprocessing it pipeline to today in important about as X

For extraordinary cell on comments, trial customers not I you all focus what see and in the area. the driving really see, these just opening larger, as these allocating And resources XXx you starting mentioned modalities. across and gene therapy, the in activity COVID, clinical new projects to and it’s here modalities to but new to

high, to customer important that in and level the plays that very, So very clinical that’s really to trials. continues note through activity be

here point biologic monoclonal of standard and the drugs. another to antibodies of is are the becoming care Now predominant take class

treatments have volume biosimilar that the markets At add these that time, growth, such India, provides ramping Vijay. emerging So exceptional access indications to you on for the in starting products are volume are and to primary also treatment additional China And new antibodies new same and amount antibody launched what’s you and going monoclonal is are in high-growth market leverage. that, an driving business recently and our and significant markets, driver here. the of and as to monoclonal growth then to that have

been So with that are is the single-use penetration those within the the technology and lower. these another We’ve this higher lastly, And their of are of biosimilars vector drugs for biologic about are and then start penetration additional antibody increasing patent, And bioprocessing that’s impetus. business. the drugs, starting growth a world that’s leveraging to now. some monoclonal I’ll the fact been talking leverage an growth off where the volume come which adoption has providing that while, throughout

more we of helped that third we’ve billion all for on talked volume, growing on announced technology. that $X technologies have over well coming even So in top And is SUT of substituting we single-use our faster. for the provides technologies activity about is and that but that Wales. Cardiff, just traditional single-use new And plant

also So the basis aggregate And COVID. on the that, that drive that high count will of look low outside we that on at that. that’s feel very perspective beyond and look together what’s here XXXX really why that we and we it of it’s supports single-digit for high growth double-digit our ultimately confident going because single-digit, at

Vijay Kumar

one And perhaps helpful, in expectations margins for Matt inflation we mid-XXs. below. came in FX assuming maybe QX I chain incrementals quick about Matt, one was impact That’s Rainer. McGrew, QX fiscal was were or perhaps supply or this just incremental looking for this have at ‘XX. talk think and maybe

Matt McGrew

kind through for Yes. of QX, I about XX%. mean, No, we came

we was thought, pretty with much I think that what line Vijay. in

you think to here it right? So it, think a a in million talk year-over-year So all normally I kind about – of in difference, that million we was no real was this $XX XX, it headwind for difference the the mean perspective, between quarter, FX, us. that $X.XX like $XX from to I

but the I kind FX quarter. that. what Obviously, think chain saw excuse quarter all In think our I were to think through was work we it is, really able anything. don’t first is I of here and So – me. it we supply way

full just as kind a point other I would through seeing. bring as – then to the no we’re And As I of up year impact to that far than think year the that good there as is the far fall full you say out. FX lay so goes, change

fall the the was growth XX% XX%. mid-single-digit think say, more expect XX% moves we sit going time. as last currency that from and of today, But here January, the year core that like for going to to, sort have of We XX% kind core given to seen and be it’s we guided that I down we versus the continue thought to XX%, through. XX% XX% FX will that In XX bring to that acquisitions, fall-through to the we’ve XX% to XX since to to January,

still year us, pretty look, sizing initially half EPS still color to during FX right the now, And significant probably maybe the EPS of So be single-digit just headwind think headwind, going it you pretty is for if to what us that headwinds that growth leaves It’s give leaves $X.XX year-over-year. what that, we deliver I and on that’s I a a thought. despite for is here some a mean of year-over-year, number the FX meaningful year. we low

pretty big bit a it too. headwind the quarter, it’s So little here in year, for was and the here a

Vijay Kumar

you. Thank Matt. helpful, That’s

Operator

We will take our Melius Research. from Davis next question of Scott

Rainer Blair

Scott, good morning.

Scott Davis

that here. The and capturing Thanks FX general is much issues guys. out logistics for are all it’s But can’t the do you additional detail morning, price – cost that do I are about general FX. price prevalent? I the so still you mean, and there inflation – offset perhaps. to I know dynamic, Good

Rainer Blair

price very traction. good been and working directly have we we’re Scott, indirectly, seeing and

necessary of that And classic our we’re the because times our shorter in and continue start Let we moves to seeing with drive off you more our of the in able a types there that about Many supply. with today labor are things of let here. We’ve our related because gaining me have of robustness from lead businesses Danaher manufacturing of System, the to do memory pressures are course, to ensuring the broadly there. for the of here of out is to past. components that Business contain inflationary in and chips share One, to lay able And order inflation. are me business. our and secure able that fact have out perhaps freight other teams to sort supply, the this. and But nonetheless, topics chipsets access been to number talked the

equation an gain. to of and So entire important it’s this growth aspect share

Secondly, in now the sense, the DBS to comments the are putting able us are place quickly I’ll reengineer not of next-gen to chipsets types those example – our that again, costs introductory the chip have and helping use broadly also I other more as gain then that, only in we toolset offset of to supply, in and more we consolidate reduce been also mentioned costs. set but look,

So supply is there if will, driving price, of costs. are we is an time, secure machine, there. entire to offset and DBS the you course, that see At traction driving same to and strong we

first are will, if we here points you fact, backlog it, of quarter had a that quarter, amount price XXXX and over the of, basis well still In in in fair a that’s right. XXX

worked the to we through of now there. that and majority expect So, backlog momentum have see continued

our specked and degree leverage provides keyed the to And the XX% way testament with So, that thinking many which are of they strength about of think just that. instruments that’s points, portfolio, about right us differentiation product supply. XXX-plus model the basis into of price razor/blade the another business at to it’s in or these or consumables, of equipment the of that our levels this

Operator

to move will Dan next Cowen. Brennan We of

Rainer Blair

Dan. Good Hi morning.

Dan Brennan

quarter. questions. Congrats for Good taking on the Thanks morning the Rainer.

ex-COVID, investors, billion dissecting appreciate I high digit obviously, long-term. at And how great in the can it demand, guide any just you all could of a back this against COVID to from the with the with robust and is high-single I about blocked it if it’s be of orders? there billion So, incorporate really if is to single, part much from about which low-double of is a continues given so nice firm would $X tough base, bioprocess, like kind comp. provide does, interest XXXX But to the quarter in digit obviously, a driver color learn COVID big go point extremely $X that helpful if COVID. growth

Rainer Blair

aggregate, as is, to does, and as are think going fluctuation market bioprocessing which believe are the backlog, going do way what year. again, low-double and decision business within COVID grow, booster And for both about strength volumes, that to age we of continue an I is both Really, growing the there as digit, is a out, COVID of COVID rapidly to whether strength on is it Dan. becomes just the high-single well that Thanks it immunization there it that as digit continues support relates to but to our you as in the the a the about annualized thinking markets for guide underlying laid groups, part do of that, larger is different we see regimen. whether we

we business, here. All investments capture to are these is part of a is this part shares of are is the and another is which a making that but And is ensure that appropriate COVID larger, we open of belief our business, questions. our at there it rate growing faster

So digits, XXXX. Dan, growth digits for bioprocessing high-single low-double

Dan Brennan

Rainer. Thanks

in really about Aldevron is can do full quarter, in think will quarter us first integration how we the the really a you on and and I going year give little the a the strong out on how color of light beyond? So, strong Maybe of XXXX get for gate. –

Rainer Blair

have we I bringing capacity. I the with growing, the pleased with mean times on been couldn’t there up be how working team. team, they more several seeing are

a We you that’s our Danaher in combination expansions of XX% of that couple a of invest quickly expectations System things. And traction. And has how continue and Business gained to gives a growth sense there. the exceeded

and growth the to business fast Business the ensure to we applying quality to is to and Aldevron pulling of Danaher that at XX% of and year, leadership million the half to this as lead number, in plus the its expectation is the thing revenue times, first team to $XXX previously System in talked possible a We fortify that as that advantage potential. XX% open continue over The in we well the be in our And expect their drive number we about. think think first QX. for we is XXXX, certainly good that competitive

all on and cylinders. a for million So, number, good the $XXX is that firing is year team

Dan Brennan

And could in. I if one squeeze more

actually on are if you QX, full good said maintained. for the think you give nice beginning news you for you. are Thank QX? and are China? year since update Obviously, a missed rebound China you us what this Just China. the about you like kind year number, I Maybe you through full Maybe guide expecting could expecting is like in of the just guys it. managing that how an And do

Rainer Blair

Sure.

to to of when first China the and larger here. talked see spoken see here of first customers. March really week plants continue start we team have these to and we those scale the at some in more we our In was here we revisit, although opening it just to of and So, they have started April, up the end activity we impact of the approval see about also yesterday quarter, received shutdowns, the to just

work Again, headwind do point second quarter. in the expect we so And basis to QX that XXX was in the digits. that through XXX to mid-single the included of guide basis shutdowns points here our we

mid percentages China about we digit will here a for for probably level activity remember, year. that growth minus in China, that quarter. expect large high-single last So, digit as the in had think we strong down and we in very QX, And to the high-single quarter be QX, transaction

and Now high-single market. continue then to we that through QX China in we once the expect to catch back here digit unwind where to a again, see as year up continue

Dan Brennan

Thank Great. you.

Operator

Meehan question Nephron our will Research. next take We Jack of from

Rainer Blair

you? are How Jack. morning Good

Jack Meehan

morning. Good Good. you. Thank

So of there? for just of change Sciences, to – businesses, Leica I trends to the talk some wanted year? growth How you about expectations Can order durability heavy Industrial. SCIEX, Pall the any Micro, are the seeing on growth you Life are the capital the turn and to

Rainer Blair

pivot now Sciences, you seeing Life if Jack, analytical the more we various are the very from business. activity strong So, life the science bioprocessing to we businesses, suggest, and as sectors in underlying of in

If have you the CROs, to think our what continue funnels academic about and research quarter-over-quarter are outpace seen segment, XXXX. strong in Pharmaceutical customers, we

class-leading exceptionally leveraging driving XXXX the then we sales and of I gains. course, accurate as talked that the that market innovation growing field those instrument And Quad, which are recent the learning. record ZenoTOF, had. recent are about particularly and most think of SCIEX, and mAb those for with that their is wide at the of buttressed Mica, well as us, talked the that confocal Life strong to track Benchtop because order I Beckman Triple we combination the have machine have CytoFLEX well launch. share innovations launches Sciences,

we from forward. firing the institutions in very, future And are on but the that also foreseeable biotech environment. the they to sustainable want as see innovation think bullish academic investments are for on that, and here as all sector, both investment to the science continue sectors, cylinders well as very that’s So, a we drive here strong that we

Jack Meehan

Great. M&A. a And then just macro broader question been very choppy a It’s on environment. obviously

was the you M&A. quarter a flow You for look light statement, it on at cash

Just have from like curious seeing Thanks. you do how kind of feel sellers expectations changed you in are just market, willingness in at do environment? choppy the your own all assets a and to M&A

Rainer Blair

environments These and from Well, about Jack, of good M&A I will an inevitably we are funnel. with very we in dislocation our of environments kind historically opportunity you, these perspective. how tell positioned feel excelled show have we

volatility are strong of $X not cash EBITDA. are it’s today too over to might see that, it over said impact free that, relatively flow Having while billion and we seeing a probably and full with that Now turn, we is sitting recent having $XX the here early of feel that that billion little volatility. Xx of a said the way very

balance the well a we So, ahead. our the sheet opportunities like terms lie position as of feel as in in very we both of good strength are that

Operator

We question take of next our Donnelly Patrick will Citi. from

Rainer Blair

Patrick. morning Good

Patrick Donnelly

side. Thanks questions. kind Over lot in Europe, Rainer. there going obviously, seen on geopolitical morning you region talk is for about just have if change over Maybe side. as on your what on want China jump from there, Any work to perspective that behavior? through you the on away you in any Can the in taking we guys’ a customer of funding from this? change geographic Good the

Rainer Blair

Europe perform continued us. well for Western has So, to very

in Eastern very perspective, just bioprocessing And research case. geopolitical you been to life reference that strong. diagnostics as is, the close we very here, a to in a area Western had here is And comments just in continue think the a Certainly, factor remain we little science year prior growth as example. mid-teens some in well. Europe first of that the opening our bit has and strong QX the here because while side, levels about to the in the performance And as see your in the not an Europe, moderates say, activity Europe Western of in from mentioned that I large we think of a activity As let’s high, normal levels quarter.

Western us as to perform Europe for So, expected. continues

Patrick Donnelly

on maybe really strong. helpful. looks can And there then the maybe talk the looking about sustainability also the that? just about business, core the pretty just strong, just then at And That’s ex-COVID, you diagnostics Can there. margins talk diagnostics performance Okay. Matt

Rainer Blair

the at close in of about, regions, about to think with pre-pandemic or exception all levels, are levels. we very the really we China, seeing momentum patient really I which levels talked business As activity

and you well DxA the and hematology we patient past perspective the over from back macro are for launches we continuing here for we on as in a it’s from also as and benefit NPI the pace put small so the us. to invested automation that had, positive have environment recent labs, year. medium-sized have if the DxHXXX a that volume, And product Fit that, And then of that

be want you a So forward for do us, continues diagnostics momentum. this? take strong to to Matt,

Matt McGrew

the that of you are big I will to that we volume I there. Yes. be seeing that that on think Cepheid part going mean margin the a about I and front, be think is mean

got But margins level. I we at we that next here and expect pretty sustainable are into So, as that those have think volume touch quarter. to long have as a less

than similar Cepheid importantly, right. of and about very think different margin Cepheid the talked have tests, other profile no I It’s flu. to respiratory profile margin the the the is of actually We

it’s a think I we So, sustainable as number look here forward.

Patrick Donnelly

guys. Thanks

Operator

our will question We Sergott of Barclays. final take Luke from

Rainer Blair

Good morning Luke.

Luke Sergott

again here. Thanks question morning. for Good the

COVID long-term of roll really growth coming from? of where I wanted and figure out trying dig just target? growth are air, adding of is biopharma on could and that you that long-term off the I offsets kind as the are I mAbs. So, in the target, and that much the how but a maintain digits give us the to continue in capacity, to know you high-single guess You about guys off, rolls kind up completely to sense new talked

Rainer Blair

to. Happy

growth course are some this volume the volumes, business. it’s some thinking keep way additional that driving biosimilar within the Those accelerator the our about drive are technology it drugs business, the that are the COVID growth the Luke, single-use the will of business. casting of really the we does, mind, And what underlying that overall – of rate then details, this but out been trials, here So here it really is variation adoption. of clinical realm foundations what the growth strength in is we have And commercialized which that in business, in that business. of I as laid the do mAbs, of

have And you continues digit growth which is grow you and take term the to low-double the digit, supports for take guide we laid digit XXXX out. so growth that talked high-single high-single that drivers quarter-over-quarter and have the the growth backlog, longer That about. what I

Luke Sergott

to faster – we should guys Great. out continuing Is expect ‘XX? add is that here, Aldevron capacity. that than to in It’s – coming ‘XX And through pace on or I still expected, you so know Thanks. are they and that still to back helpful.

Rainer Blair

to line. here subject to are or say expertise, are would as that better that continues schedule only their which continue these matter gain the I as team pace speed we to add is coming with not line going out differentiated. But That’s after on, than after on line programs

So, of unique in adoption but Danaher their System. also with Business the marketplace, the

for here in $XXX million look we So, XXXX. that

Luke Sergott

That’s me. all you. Thank it Okay. for Great.

Operator

host And concluding for the happy call remarks. session. to return this does be question-and-answer any would conclude our I to our

John Bedford

everyone. Thanks,

around be questions. week the of rest will the for We

Operator

today’s conclude does This call.

now everyone, day. may have your lines and disconnect a great You

Danaher (DHR) 21 Apr 222022 Q1 Earnings call transcript