Danaher 2015 Annual Report Download

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FORM 10-K
DANAHER CORP /DE/ - DHR
Filed: February 24, 2016 (period: December 31, 2015)
Annual report with a comprehensive overview of the company
The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user
assumes all risks for any damages or losses arising from any use of this information, except to the extent such damages or losses cannot be
limited or excluded by applicable law. Past financial performance is no guarantee of future results.

Table of contents

  • Page 1
    ... Researchâ„ FORM 10-K DANAHER CORP /DE/ - DHR Filed: February 24, 2016 (period: December 31, 2015) Annual report with a comprehensive overview of the company The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user...

  • Page 2
    ...EXCHTNGE TCT OF 1934 For the fiscal year ended December 31, 2015 OR o TRTNSITION REPORT PURSUTNT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHTNGE TCT OF 1934 For the transition period from to Commission File Number: 1-8089 _____ DTNTHER CORPORTTION (Exact name of registrant as specified in its...

  • Page 3
    ...9, 2016, the number of shares of Registrant's common stock outstanding was 687,154,521. The aggregate market value of common stock held by non-affiliates of the Registrant on July 3, 2015 was $53.9 billion, based upon the closing price of the Registrant's common stock as quoted on the New York Stock...

  • Page 4
    ... Officers and Corporate Governance Executive Compensation Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Certain Relationships and Related Transactions, and Director Independence Principal Accountant Fees and Services 108 108 108 108 108 Market...

  • Page 5
    ... a result of new information, future events and developments or otherwise. PTRT I ITEM 1. BUSINESS General Danaher Corporation designs, manufactures and markets professional, medical, industrial and commercial products and services, which are typically characterized by strong brand names, innovative...

  • Page 6
    ... ("New Danaher") and a diversified industrial growth company named Fortive Corporation ("Fortive"). New Danaher will consist of Danaher's existing Life Sciences & Diagnostics (including Pall Corporation ("Pall")) and Dental segments as well as the water quality and product identification businesses...

  • Page 7
    ... factors described under "-Competition." Our water quality business provides products under a variety of brands, including CHEMTREAT, HACH, HACH/LANGE, MCCROMETER and TROJAN TECHNOLOGIES. Manufacturing facilities are located in North America, Europe, Asia and Latin America. Sales are made through...

  • Page 8
    ... facilities are located in North America, Europe, Asia and South America. Sales are generally made through independent distributors and our direct sales personnel. LIFE SCIENCES & DITGNOSTICS Our diagnostics business offers analytical instruments, reagents, consumables, software and services...

  • Page 9
    ... "-Competition." Our diagnostics business generally markets its products under the APERIO, BECKMAN COULTER, HEMOCUE, IRIS, LEICA BIOSYSTEMS, MAMMATOME, RADIOMETER and SURGIPATH brands. Manufacturing facilities are located in North America, Europe, Asia and Australia. The business sells to customers...

  • Page 10
    ... of applications in two primary business groups: • Life Sciences. Pall's life sciences technologies facilitate the process of drug discovery, development, regulatory validation and production and are sold to biopharmaceutical, food and beverage and medical customers. In the biopharmaceutical area...

  • Page 11
    ... "-Competition." Our life sciences business generally markets its products under the BECKMAN COULTER, LEICA MICROSYSTEMS, MOLECULAR DEVICES, PALL and SCIEX brands. Manufacturing facilities are located in Europe, Australia, Asia and North America. The business sells to customers through direct sales...

  • Page 12
    ..., LINX, PANTONE, VIDEOJET and X-RITE brands. Manufacturing facilities are located in North America, Europe, South America, and Asia. Sales are generally made through our direct sales personnel and independent distributors. Tutomation We entered the automation control industry through the acquisition...

  • Page 13
    ...low-cost manufacturing locations, and increasing consolidation in particular markets. The number of competitors varies by product and service line. Our management believes that we have a market leadership position in many of the markets we serve. Key competitive factors vary among our businesses and...

  • Page 14
    ...sets forth our research and development expenditures over each of the last three years ended December 31, by segment and in the aggregate ($ in millions): 2015 2014 2013 Test & Measurement Environmental Life Sciences & Diagnostics Dental Industrial Technologies Total $ 208.1 188.6 554.6 133.8 154...

  • Page 15
    ... and development was not significant in 2015, 2014 or 2013. Government Contracts Although the substantial majority of our revenue in 2015 was from customers other than governmental entities, each of our segments has agreements relating to the sale of products to government entities. As a result, we...

  • Page 16
    ...Australia, Brazil, Canada, China and Japan, have also adopted or are in the process of adopting regulations and standards for medical devices sold in those countries. We are also subject to various health care related laws regulating fraud and abuse, pricing and sales and marketing practices and the...

  • Page 17
    ... total annual revenue for the year ended December 31, by segment and in the aggregate, based on geographic destination: 2015 2014 2013 Test & Measurement Environmental Life Sciences & Diagnostics Dental Industrial Technologies Total percentage of revenue derived from customers outside of the United...

  • Page 18
    ... consolidated sales in 2015, 2014 or 2013. Tvailable Information We maintain an internet website at www.danaher.com. We make available free of charge on the website our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and amendments to those reports, filed...

  • Page 19
    ...customers, continually developing new products and services to maintain and expand our brand recognition and leadership position in various product and service categories and penetrating new markets, including high-growth markets. Our failure to compete effectively and/or pricing pressures resulting...

  • Page 20
    ... in our served markets; obtain adequate intellectual property rights with respect to key technologies before our competitors do; successfully commercialize new technologies in a timely manner, price them competitively and cost-effectively manufacture and deliver sufficient volumes of new products of...

  • Page 21
    ... of the date of this report the acquisition of Pall in 2015 is Danaher's largest acquisition and has expanded Danaher's business into new markets. Acquisitions, joint ventures and strategic relationships involve a number of financial, accounting, managerial, operational, legal, compliance and other...

  • Page 22
    ...to customers, declining sales, loss of customers, loss of market share, recalls, seizures of adulterated or misbranded products, injunctions, administrative detentions, refusals to permit importations, partial or total shutdown of production facilities or the implementation of operating restrictions...

  • Page 23
    ... utilizing managed care for the delivery of health care services, forming group purchasing organizations to improve their purchasing leverage and using competitive bid processes to procure health care products and services. These changes as well as other impacts from market demand, government...

  • Page 24
    ... our returns on investment, require us to incur significant expenses or modify our business model or impair our flexibility in modifying product, marketing, pricing or other strategies for growing our business. Our products and operations are also often subject to the rules of industrial standards...

  • Page 25
    ... out of the use of products or services and claims relating to intellectual property matters, employment matters, tax matters, commercial disputes, competition and sales and trading practices, environmental matters, personal injury, insurance coverage and acquisition or divestiture-related matters...

  • Page 26
    ... customers in certain of our served industries could adversely impact our profitability. Our financial results are subject to fluctuations in the cost and availability of commodities that we use in our operationsn As discussed in "Item 1. Business - Materials," our manufacturing and other operations...

  • Page 27
    ... may extend lead times, limit supplies or increase prices. If we cannot purchase sufficient products at competitive prices and quality and on a timely enough basis to meet increasing demand, we may not be able to satisfy market demand, product shipments may be delayed, our costs may increase or we...

  • Page 28
    ... of our manufacturing operations, suppliers and employees are located outside the U.S. Since our growth strategy depends in part on our ability to further penetrate markets outside the U.S. and increase the localization of our products and services, we expect to continue to increase our sales and...

  • Page 29
    ... multiple purposes, such as administration, sales, manufacturing, warehousing and/or distribution. The number of significant facilities by business segment is Test & Measurement, 38; Environmental, 46; Life Sciences & Diagnostics, 143; Dental, 48; and Industrial Technologies, 61. We consider our...

  • Page 30
    ... Executive Vice President Senior Vice President - General Counsel Senior Vice President - Strategic Development Senior Vice President - Human Resources Senior Vice President - Chief Accounting Officer Senior Vice President - Corporate Development 1984 1984 2002 1996 2006 2002 2016 2005 2012 2002...

  • Page 31
    ... stock prices per share as reported on the New York Stock Exchange, and the dividends declared per share, in each case for the periods described below, were as follows: 2015 High Low Dividends Per Share High (a) 2014 Low Dividends Per Share First quarter Second quarter Third quarter Fourth quarter...

  • Page 32
    ... DTTT ($ in millions, except per share information) 2015 2014 2013 2012 2011 Sales $ Operating profit Net earnings from continuing operations Earnings from discontinued operations, net of income taxes Net earnings Net earnings per share from continuing operations: Basic Diluted Net earnings per...

  • Page 33
    ... monetary and fiscal policies. The acquisition of Pall, as further discussed below, provides additional sales and earnings growth opportunities for the Company's Life Sciences and Diagnostics segment by expanding the segment's geographic and product line diversity, 29 Source: DANAHER CORP /DE/, 10...

  • Page 34
    ... of the Company's Life Sciences & Diagnostics segment. In its fiscal year ended July 31, 2015, Pall generated consolidated revenues of approximately $2.8 billion. Pall serves customers in the biopharmaceutical, food and beverage and medical markets as well as the process technologies, aerospace and...

  • Page 35
    ... initiatives taken in 2014 and 2015, net of incremental year-over-year costs associated with various product development, sales and marketing growth investments and the effect of a stronger U.S. dollar in 2015 - 75 basis points 31 Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered by...

  • Page 36
    ... product line disposition in the third quarter of 2014 - 40 basis points Business Segments Sales by business segment for the years ended December 31 are as follows ($ in millions): 2015 2014 2013 Test & Measurement Environmental Life Sciences & Diagnostics Dental Industrial Technologies Total TEST...

  • Page 37
    ... in 2014 and 2015, net of incremental year-over-year costs associated with various new product development, sales and marketing growth investments and the effect of a stronger U.S. dollar in 2015 - 135 basis points Reimbursement of costs related to finance and accounting, information technology and...

  • Page 38
    ... in 2014 and 2013, net of incremental year-over-year costs associated with various new product development, sales and marketing growth investments - 155 basis points 2014 vs. 2013 operating profit margin comparisons were unfavorably impacted by: • • Incremental year-over-year costs associated...

  • Page 39
    ...the segment's water quality business grew at a mid-single digit rate during 2014 as compared with 2013. Sales growth in the analytical instrumentation product line was led primarily by continued strong sales of instruments and related consumables and service in North America, China, Europe and Latin...

  • Page 40
    ... taken in 2013 and 2014, net of incremental year-over-year costs associated with various product development, sales and marketing growth investments - 35 basis points 2014 vs. 2013 operating profit margin comparisons were unfavorably impacted by: • • Incremental year-over-year costs associated...

  • Page 41
    ...a mid-single digit rate during 2014 as compared to 2013. Demand in the clinical business increased on a year-over-year basis led by continuing strong demand in China and other high-growth markets and a return to growth in North America. Continued strong global consumable sales in 2014 related to the...

  • Page 42
    ...of dental consumables, equipment and services, and is dedicated to driving technological innovations that help dental professionals improve clinical outcomes and enhance productivity. Dental Selected Financial Data For the Year Ended December 31 ($ in millions) 2015 2014 2013 Sales Operating profit...

  • Page 43
    ... taken in 2013 and 2014, net of incremental year-over-year costs associated with various product development, sales and marketing growth investments - 80 basis points 39 Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered by Morningstar® Document Research℠The information contained...

  • Page 44
    ... product identification and automation strategic lines of business, the segment also includes the Company's sensors and controls, energetic materials and engine retarder businesses. Industrial Technologies Selected Financial Data For the Year Ended December 31 ($ in millions) 2015 2014 2013 Sales...

  • Page 45
    ... segment's sensors and controls businesses. Operating profit margins increased 160 basis points during 2014 as compared to 2013. Year-over-year operating profit margin comparisons were favorably impacted by: • Higher 2014 sales volumes from existing businesses and incremental year-over-year cost...

  • Page 46
    ...businesses, and 2015 acquisition-related charges associated with fair value adjustments to acquired inventory and deferred revenue in connection with the acquisition of Pall and Nobel Biocare during the third quarter of 2015 and the fourth quarter of 2014, respectively, which increased cost of sales...

  • Page 47
    ...'s sales and marketing growth initiatives, higher corporate expenses and incremental year-over-year costs associated with restructuring actions and continuing productivity improvement initiatives. In addition, transaction costs incurred in connection with the closing of the Nobel Biocare acquisition...

  • Page 48
    ...by approximately 140 and 20 basis points in 2015 and 2013, respectively, and increased the provision for income taxes by approximately 170 basis points in 2014. The Company conducts business globally, and files numerous consolidated and separate income tax returns in the United States federal, state...

  • Page 49
    ... plan benefit adjustments resulted in a loss of $361 million in 2014 compared to a gain of $289 million in 2013. INFLTTION The effect of inflation on the Company's revenues and net earnings was not significant in any of the years ended December 31, 2015, 2014 or 2013. 45 Source: DANAHER CORP...

  • Page 50
    ... of its foreign operations into U.S. dollars, Danaher's functional currency. Costs incurred and sales recorded by subsidiaries operating outside of the United States are translated into U.S. dollars using exchange rates effective during the respective period. As a result, the Company is exposed to...

  • Page 51
    ... with high-quality financial institutions and exposure at any one institution is limited. Equity Price Risk The Company's available-for-sale investment portfolio includes publicly traded equity securities that are sensitive to fluctuations in market price. Changes in equity prices would result in...

  • Page 52
    ... years ended December 31: Overview of Cash Flows and Liquidity ($ in millions) 2015 2014 2013 Total operating cash flows provided by continuing operations $ 3,828.0 $ 3,618.0 $ 3,467.4 Cash paid for acquisitions Payments for additions to property, plant and equipment Payments for purchases...

  • Page 53
    ... acquired complement existing units of the Test & Measurement, Environmental, Life Sciences & Diagnostics and Dental segments. The aggregate annual sales of these 16 businesses at the time of their respective acquisitions, in each case based on the company's revenues for its last completed fiscal...

  • Page 54
    ... existing units of the Industrial Technologies, Life Sciences & Diagnostics, Environmental and Test & Measurement segments. The aggregate annual sales of these 12 businesses at the time of their respective acquisitions, in each case based on the company's revenues for its last completed fiscal year...

  • Page 55
    ...sales off this shelf registration statement for general corporate purposes, including without limitation repayment or refinancing of debt or other corporate obligations, acquisitions, capital expenditures, share repurchases and dividends and working capital. Stock Repurchase Program On July 16, 2013...

  • Page 56
    ... subsidiaries hold for indefinite reinvestment is generally used to finance foreign operations and investments, including acquisitions. As of December 31, 2015, the total amount of earnings planned to be reinvested indefinitely and the basis difference in investments outside of the United States...

  • Page 57
    ... request of the Company as a director or officer of any other entity, subject to limited exceptions. Danaher's Amended and Restated By-laws provide for similar indemnification rights. In addition, Danaher has executed with each director and executive officer of Danaher Corporation an indemnification...

  • Page 58
    ... evaluating the estimates derived by the market-based approach, management makes judgments about the relevance and reliability of the multiples by considering factors unique to its reporting units, including operating results, business plans, economic projections, anticipated future cash flows, and...

  • Page 59
    ... benefit cost for its U.S. and nonU.S. pension and other postretirement benefit plans. Previously, the Company estimated the service and interest cost components utilizing a single weightedaverage discount rate derived from the yield curve used to measure the benefit obligation. The new estimate...

  • Page 60
    ... Company's nominal tax rate of 1.0% would have resulted in an additional income tax provision for continuing operations for the fiscal year ended December 31, 2015 of $33 million. NEW TCCOUNTING STTNDTRDS In December 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards...

  • Page 61
    ... to be entitled in exchange for those goods or services. On July 9, 2015, the FASB deferred the effective date of the standard by one year which results in the new standard being effective for the Company at the beginning of its first quarter of fiscal year 2018. The Company is currently assessing...

  • Page 62
    ...and approximately 4% of the Company's total revenues for the year then ended. The Company's independent registered public accounting firm has issued an audit report on the effectiveness of the Company's internal control over financial reporting. This report dated February 23, 2016 appears on page 59...

  • Page 63
    ...of total assets as of December 31, 2015 and approximately 4% of the revenues for the year then ended. Our audit of internal control over financial reporting of Danaher Corporation and subsidiaries also did not include an evaluation of the internal control over financial reporting of Pall Corporation...

  • Page 64
    ... fairly in all material respects the information set forth therein. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Danaher Corporation's internal control over financial reporting as of December 31, 2015, based on criteria...

  • Page 65
    ... 2015 2014 TSSETS Current assets: Cash and equivalents Trade accounts receivable, less allowance for doubtful accounts of $134.2 and $120.3, respectively Inventories Prepaid expenses and other current assets Current assets, discontinued operations Total current assets Property, plant and equipment...

  • Page 66
    ... STTTEMENTS OF ETRNINGS ($ and shares in millions, except per share amounts) Year Ended December 31 2015 2014 2013 Sales Cost of sales Gross profit Operating costs: Selling, general and administrative expenses Research and development expenses Operating profit Nonoperating income (expense): Other...

  • Page 67
    ... ($ in millions) Year Ended December 31 2015 2014 2013 Net earnings Other comprehensive income (loss), net of income taxes: Foreign currency translation adjustments Pension and postretirement plan benefit adjustments Unrealized gain (loss) on available-for-sale securities Total other comprehensive...

  • Page 68
    ... 31, 2014 Net earnings for the year Other comprehensive income (loss) Dividends declared Common stock-based award activity Common stock issued in connection with LYONs' conversions Shares redeemed through the distribution of the communications business (26.0 shares held as Treasury shares) Change...

  • Page 69
    ...($ and shares in millions) Year Ended December 31 2015 2014 2013 Cash flows from operating activities: Net earnings Less: earnings from discontinued operations, net of income taxes Net earnings from continuing operations Noncash items: Depreciation Amortization Stock-based compensation expense Cash...

  • Page 70
    ...brand names, innovative technology and major market positions. The Company operates in five business segments: Test & Measurement, Environmental, Life Sciences & Diagnostics, Dental and Industrial Technologies. The Company's Test & Measurement segment offers essential products, software and services...

  • Page 71
    ... concentrations of credit risk because of the diversified portfolio of individual customers and geographical areas. The Company recorded $57 million, $43 million and $28 million of expense associated with doubtful accounts for the years ended December 31, 2015, 2014 and 2013, respectively. Included...

  • Page 72
    ... information about the Company's goodwill and other intangible assets. Revenue Recognition-As described above, the Company derives revenues primarily from the sale of Test & Measurement, Environmental, Life Science & Diagnostic, Dental and Industrial Technologies products and services. For revenue...

  • Page 73
    ... income (loss) within stockholders' equity. Assets and liabilities of subsidiaries operating outside the United States with a functional currency other than U.S. dollars are translated into U.S. dollars using year-end exchange rates and income statement accounts are translated at weighted average...

  • Page 74
    ...Note 13 for additional details). (b) 70 Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks...

  • Page 75
    ... per share are limited under the new standard to those investments for which the Plan has elected to estimate the fair value using the net asset value practical expedient. The ASU is effective for entities (other than public business entities) for fiscal years beginning after December 15, 2016, with...

  • Page 76
    ... of the Company's Life Sciences & Diagnostics segment. In its fiscal year ended July 31, 2015, Pall generated consolidated revenues of approximately $2.8 billion. Pall serves customers in the biopharmaceutical, food and beverage and medical markets as well as the process technologies, aerospace and...

  • Page 77
    ... acquired complement existing units of the Environmental, Life Sciences & Diagnostics and Industrial Technologies segments. The aggregate annual sales of these 12 businesses at the time of their respective acquisitions, in each case based on the company's revenues for its last completed fiscal year...

  • Page 78
    ... 2014 acquisitions as a group ($ in millions): Nobel Biocare Others Total Trade accounts receivable Inventories Property, plant and equipment Goodwill Other intangible assets, primarily customer relationships, trade names and technology In-process research and development Trade accounts payable...

  • Page 79
    ... services include finance and accounting, information technology, payroll processing, and other administrative services as well as certain manufacturing, supply chain, and selling activities for a portion of the transferred businesses. 75 Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered...

  • Page 80
    ...of the Separation will create: • a multi-industry, science and technology growth company that will retain the Danaher name and consist of Danaher's existing Life Sciences & Diagnostics (including Pall) and Dental segments as well as the water quality and product identification businesses, which in...

  • Page 81
    ... effect on the Company's operations and financial statements. On July 4, 2010, the Company entered into a joint venture with Cooper Industries, plc ("Cooper"), combining certain of the Company's hand tool businesses with Cooper's Tools business to form a new entity called Apex Tool Group, LLC ("Apex...

  • Page 82
    ... following is a rollforward of the Company's goodwill by segment ($ in millions): Life Sciences & Diagnostics Test & Measurement Environmental Dental Industrial Technologies Total Balance, January 1, 2014 Attributable to 2014 acquisitions Attributable to 2014 divestitures (see Note 3) Foreign...

  • Page 83
    ... During 2015, the Company acquired finite-lived intangible assets, consisting primarily of customer relationships, with a weighted average life of 14 years. Refer to Note 2 for additional information on the intangible assets acquired. Total intangible amortization expense in 2015, 2014 and 2013 was...

  • Page 84
    ... Noncurrent Current 2014 Noncurrent Compensation and benefits Restructuring Claims, including self-insurance and litigation Pension and postretirement benefits Environmental and regulatory compliance Taxes, income and other Deferred revenue Sales and product allowances Warranty Other Total $ 968...

  • Page 85
    ... and sale of Swiss franc-denominated senior unsecured bonds to repay a portion of the commercial paper issued to finance the Pall Acquisition. Further details regarding the Pall Acquisition financing are set forth below. Commercial Paper Programs and Credit Facilities On July 10, 2015, the Company...

  • Page 86
    ... banks to support the issuance of letters of credit. Long-Term Indebtedness Long-Term Indebtedness Related to Pall Acquisition On July 8, 2015, DH Europe Finance S.A., a wholly-owned finance subsidiary of the Company, completed the underwritten public offering of each of the following series of Euro...

  • Page 87
    ... on the Pall Financing U.S. Notes is payable semi-annually in arrears on March 15 and September 15 of each year, commencing on March 15, 2016. On December 8, 2015, DH Switzerland Finance S.A., a wholly-owned finance subsidiary of the Company, completed the underwritten public offering and sale of...

  • Page 88
    ... of the purchase price for the acquisition of Beckman Coulter. The Company pays interest on these notes semi-annually in arrears, on June 23 and December 23 of each year. 2016 Bonds-In connection with the acquisition of Nobel Biocare in December 2014, the Company acquired senior unsecured bonds...

  • Page 89
    Table of Contents period multiplied by the number of shares issuable upon conversion of a LYON. The Company paid $1 million, $2 million and $1 million of contingent interest on the LYONs for each of the years ended December 31, 2015, 2014 and 2013, respectively. Except for the contingent interest ...

  • Page 90
    ...rate Rate of compensation increase Components of net periodic pension cost: 4.4% 4.0% 4.0% N/A 2.6% 2.9% 2.3% 3.0% U.S. Pension Benefits ($ in millions) 2015 2014 Non-U.S. Pension Benefits 2015 2014 Service cost Interest cost Expected return on plan assets Amortization of prior service credit...

  • Page 91
    ... to the Company during the year ending December 31, 2016 . Selection of Expected Rate of Return on Tssets For the years ended December 31, 2015, 2014 and 2013, the Company used an expected long-term rate of return assumption of 7.5% for its U.S. defined benefit pension plan. The Company intends to...

  • Page 92
    ...Market (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Cash and equivalents Equity securities: Common stock Preferred stock Fixed income securities: Corporate bonds Government issued Mutual funds Insurance contracts Total Investments measured...

  • Page 93
    .... Expense for all defined benefit and defined contribution pension plans amounted to $232 million, $201 million and $185 million for the years ended December 31, 2015, 2014 and 2013, respectively. 89 Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered by Morningstar® Document Research...

  • Page 94
    ...one year. Weighted average assumptions used to determine benefit obligations at date of measurement: 2015 2014 Discount rate Medical trend rate - initial Medical trend rate - grading period Medical trend rate - ultimate Effect of a one-percentage-point change in assumed health care cost trend rates...

  • Page 95
    ... operations before income taxes for the years ended December 31 were as follows ($ in millions): 2015 2014 2013 $ 17.9 17.8 17.6 17.2 16.5 71.2 United States International Total $ $ 1,419.9 1,904.1 3,324.0 $ $ 1,346.5 2,054.2 3,400.7 $ $ 1,565.7 1,850.6 3,416.3 91 Source: DANAHER CORP...

  • Page 96
    ...provision for income taxes from discontinued operations for the years ended December 31, 2015, 2014 and 2013 was $16 million, $26 million and $45 million, respectively. As disclosed in Note 1, during 2015 the Company early adopted ASU 2015-17 on a prospective basis, therefore all deferred tax assets...

  • Page 97
    ... operations for the years ended December 31 varies from the U.S. statutory federal income tax rate as follows: Percentage of Pretax Earnings 2015 2014 2013 Statutory federal income tax rate Increase (decrease) in tax rate resulting from: State income taxes (net of federal income tax benefit...

  • Page 98
    ... tax returns for 2010 through 2013. In addition, the Company has subsidiaries in Belgium, Brazil, Canada, China, Denmark, Finland, France, Germany, India, Italy, Japan, Singapore, Sweden, the United Kingdom and various other countries, states and provinces that are currently under audit for years...

  • Page 99
    ... of Align Technology, Inc. ("Align") common stock that the Company received in 2009 as a result of a settlement between Align and Ormco Corporation, a wholly-owned subsidiary of the Company. The Company received cash proceeds of $251 million from the sale of these marketable equity securities and...

  • Page 100
    ... in connection with the decision to dispose of such assets. Restructuring and other related charges recorded for the years ended December 31 by segment were as follows ($ in millions): 2015 2014 2013 Test & Measurement Environmental Life Sciences & Diagnostics Dental Industrial Technologies Total...

  • Page 101
    ... of the Company's products, software and services and claims relating to intellectual property matters, employment matters, tax matters, commercial disputes, competition and sales and trading practices, environmental matters, personal injury, insurance coverage and acquisition or divestiture related...

  • Page 102
    ... standards for the generation, use, treatment, storage and disposal of hazardous and non-hazardous wastes. A number of the Company's operations involve the handling, manufacturing, use or sale of substances that are or could be classified as hazardous materials within the meaning of applicable laws...

  • Page 103
    ... business to NetScout. Stock options, RSUs and PSUs have been issued to directors, officers and other employees under the Company's 1998 Stock Option Plan and the 2007 Stock Incentive Plan. In addition, in connection with the 2007 Tektronix acquisition and the 2015 Pall Acquisition, the Company...

  • Page 104
    ... year performance period. In 2015 one-half of the annual equity awards granted to the Company's executive officers were granted as stock options, one-quarter were granted as RSUs and one-quarter were granted as PSUs. The PSUs were issued under the Company's 2007 Stock Incentive Plan. In connection...

  • Page 105
    ... Company's continuing operations stock-based compensation expense for the years ended December 31 ($ in millions): 2015 2014 2013 RSUs/PSUs: Pretax compensation expense Income tax benefit RSU/PSU expense, net of income taxes Stock options: Pretax compensation expense Income tax benefit Stock option...

  • Page 106
    ... of options during the years ended December 31, 2015, 2014 and 2013 resulted in cash receipts of $223 million, $125 million, and $158 million, respectively. Upon exercise of the award by the employee, the Company derives a tax deduction measured by the excess of the market value over the grant price...

  • Page 107
    ... been issued and reduced by the number of shares the Company could have repurchased with the proceeds from the issuance of the potentially dilutive shares. For each of the years ended December 31, 2015, 2014 and 2013, 2 million options to purchase shares were not included in the diluted earnings...

  • Page 108
    ... 19. SEGMENT INFORMTTION The Company operates and reports its results in five separate business segments consisting of the Test & Measurement, Environmental, Life Sciences & Diagnostics, Dental and Industrial Technologies segments. Operating profit represents total revenues less operating expenses...

  • Page 109
    ... & Diagnostics Dental Industrial Technologies Other Total Operations in Geographical Treas: $ 23.8 90.8 399.4 53.3 63.6 2.1 633.0 $ 17.0 76.1 391.1 24.4 70.6 1.4 580.6 $ 25.4 46.5 386.7 30.7 47.1 1.7 538.1 $ $ $ For the Year Ended December 31 ($ in millions) 2015 2014 2013 Sales: United...

  • Page 110
    ... in millions, except per share data) 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 2015: Sales Gross profit Operating profit Net earnings from continuing operations Net earnings from discontinued operations Net earnings Net earnings per share from continuing operations: Basic Diluted Net earnings...

  • Page 111
    ... 31, 2015 and accounted for approximately 4% of the Company's total revenues for the year then ended. There have been no changes in the Company's internal control over financial reporting that occurred during the Company's most recent completed fiscal quarter that have materially affected, or...

  • Page 112
    ... the sections entitled Election of Directors of Danaher, Corporate Governance and Section 16(a) Beneficial Ownership Reporting Compliance in the Proxy Statement for the Company's 2016 annual meeting and to the information under the caption "Executive Officers of the Registrant" in Part I hereof. No...

  • Page 113
    .... (3) Exhibits. The exhibits listed in the accompanying Exhibit Index are filed or incorporated by reference as part of this Annual Report on Form 10-K. 109 Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered by Morningstar® Document Research℠The information contained herein may not be...

  • Page 114
    ...'s Quarterly Report on Form 10-Q for the quarter ended July 1, 2011 (Commission File Number: 1-8089) 3.1 3.2 Amended and Restated By-laws of Danaher Corporation 4.1 Senior Indenture dated as of December 11, 2007 by and between Danaher Corporation and The Bank of New York Trust Company...

  • Page 115
    ... from Exhibit 10.4 to Danaher Corporation's Quarterly Report on Form 10-Q for the quarter ended July 3, 2015 (Commission File Number: 1-8089) 10.2 Danaher Corporation Non-Employee Directors' Deferred Compensation Plan, as amended, a sub-plan under the 2007 Stock Incentive Plan* Amended Form of...

  • Page 116
    Table of Contents 10.7 Form of Danaher Corporation 2007 Stock Incentive Plan RSU Agreement* Incorporated by reference from Exhibit 10.5 to Danaher Corporation's Quarterly Report on Form 10-Q for the quarter ended July 3, 2015 (Commission File Number: 1-8089) Incorporated by reference from Exhibit...

  • Page 117
    ... 10-Q for the quarter ended June 27, 2014 (Commission File Number: 1-8089) Incorporated by reference from Exhibit 10.35 to Danaher Corporation's Annual Report on Form 10-K for the year ended December 31, 2008 (Commission File Number: 1-8089) 10.24 Interchange Agreement dated July 22, 2011 by and...

  • Page 118
    ... 23.1 31.1 Consent of Independent Registered Public Accounting Firm Certification of Chief Executive Officer Pursuant to Item 601(b) (31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Certification of Chief Financial Officer Pursuant to Item 601(b) (31) of...

  • Page 119
    ... Consolidated Statements of Cash Flows for the years ended December 31, 2015, 2014 and 2013 and (vi) Notes to Consolidated Financial Statements. 115 Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered by Morningstar® Document Research℠The information contained herein may not be copied...

  • Page 120
    .... DTNTHER CORPORTTION Date: February 23, 2016 By: /s/ THOMAS P. JOYCE, JR. Thomas P. Joyce, Jr. President and Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this annual report has been signed below by the following persons on behalf of the Registrant and...

  • Page 121
    ... M.D. Director /s/ DANIEL L. COMAS Daniel L. Comas Executive Vice President and Chief Financial Officer /s/ ROBERT S. LUTZ Robert S. Lutz Senior Vice President and Chief Accounting Officer February 23, 2016 February 23, 2016 February 23, 2016 February 23, 2016 117 Source: DANAHER CORP /DE/, 10...

  • Page 122
    ... accounts classified as current and noncurrent. related to businesses acquired, net of amounts related to businesses disposed not included in discontinued operations. 118 Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered by Morningstar® Document Research℠The information contained...

  • Page 123
    Exhibit 10.20 Danaher Corporation Description of Non-Management Director Compensation Arrangements Effective as tf July 2015, each ntnomanagement directtr receives: • an annual cash retainer tf $110,000, paid in ftur, equal installments ftlltwing each quarter tf service; • if a directtr attends ...

  • Page 124
    ...12.1 Danaher Corporation Statement Regarding Computation of Ratio of Earnings to Fixed Charges (In millions, except ratio data) Year Ended December 31 2011 2012 2013 2014 2015 Fixed Charges: Gross Interest Expense Interest Element of Rental Expense Interest on Unrecognized Tax Benefits Total Fixed...

  • Page 125
    ... Denmark Australia Germany Turkey Canada China Mexico Spain France Delaware Germany Hong Kong Delaware India Switzerland Ireland Japan Korea, Republic of China Russian Federation Netherlands Japan Illinois Spain South Africa Italy California United Kingdom Source: DANAHER CORP /DE/, 10-K, February...

  • Page 126
    ... Corporation Fluke Europe B.V. Fluke Finance Company Limited Fluke Holding Austria GmbH Fluke International Corporation (DE) Fluke Operations B.V. Fluke Precision Measurement Limited Fluke Shanghai Corporation Gelman Sciences Inc. Gems Sensors Inc. Gilbarco Australia Pty Ltd Ireland MN Canada...

  • Page 127
    ... Kavo Dental Technologies, LLC Keithley Instruments, Inc. Kerr Corporation Kerr GmbH KerrHawe SA Kollmorgen Asia Investment Company Kollmorgen Corporation Kollmorgen Europe GmbH Kollmorgen Finance Ltd Kollmorgen s.r.o. Laetus GmbH Launchchange Finance S.Ã r.l. Launchchange Operations Limited Leica...

  • Page 128
    ... Italy Japan Switzerland Canada Switzerland Delaware France Netherlands Delaware Germany California Massachusetts Delaware Australia New York United Kingdom China Delaware Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered by Morningstar® Document Research℠The information contained...

  • Page 129
    ... India Delaware Delaware Delaware Germany Denmark China Germany Norway Washington Delaware Delaware Massachusetts China China Virginia United States Virginia China Canada Delaware California China China Oregon Switzerland United Kingdom Delaware Japan New York Delaware China Source: DANAHER CORP...

  • Page 130
    ... Argentina Brazil Italy Netherlands Delaware India United Kingdom France China Russian Federation Canada Germany Delaware Hong Kong Michigan China China Source: DANAHER CORP /DE/, 10-K, February 24, 2016 Powered by Morningstar® Document Research℠The information contained herein may not be...

  • Page 131
    ... Name June 15, 2015 Registration Number Date Filed Tektronix, Inc. 2005 Stock Incentive Plan, as amended; Tektronix, Inc. 2002 Stock Incentive Plan, as amended Danaher Corporation 2007 Stock Incentive Plan, as amended and restated; Amended and Restated Danaher Corporation 1998 Stock Option Plan...

  • Page 132
    ...not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. February 23, 2016 By: Name: Title: /s/ Thomas P. Joyce, Jr. Thomas P. Joyce, Jr. President and Chief Executive Officer Date: Source: DANAHER CORP /DE...

  • Page 133
    ... material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. February 23, 2016 By: Name: Title: /s/ Daniel L. Comas Daniel L. Comas Executive Vice President and Chief Financial Officer Date: Source: DANAHER CORP...

  • Page 134
    ..., Danaher Corporation's Annual Report on Form 10-K for the fiscal year ended December 31, 2015 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Annual Report on Form 10-K fairly presents in all material...

  • Page 135
    ... that information contained in such Annual Report on Form 10-K fairly presents in all material respects the financial condition and results of operations of Danaher Corporation. Date: February 23, 2016 By: Name: Title: /s/ Daniel L. Comas Daniel L. Comas Executive Vice President and Chief Financial...

  • Page 136
    ... not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information, except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.