Danaher 2009 Annual Report Download - page 42

Table of Contents
Tools & Components Selected Financial Data


  
Sales $1,054.3 $1,294.2 $1,336.6
Operating profit 124.8 157.7 175.6
Depreciation and amortization 21.0 21.0 20.8
Restructuring and other related charges 18.3 4.0 —
Operating profit as a % of sales 11.8% 12.2% 13.1%
Depreciation and amortization as a % of sales 2.0% 1.6% 1.6%
Restructuring and other related charges as a % of sales 1.7% 0.3% —
Components of Sales Growth (Decline)
 
Existing businesses (18.0)% (3.5)%
Acquisition / Product line divestiture — —
Currency exchange rates (0.5)% 0.5%
Total (18.5)% (3.0)%
2009 COMPARED TO 2008
Sales declined in both the mechanics’ hand tools business and the segment’s niche businesses during 2009 as compared to 2008. Price increases did not
appreciably impact segment results during 2009.
Operating profit margins in the segment were 40 basis points lower during 2009 as compared to 2008. The decrease in operating profit margins resulted
primarily from 130 basis points of incremental year-over-year restructuring costs incurred during 2009 compared to 2008. In addition, a gain recorded in 2008
from the settlement of an insurance claim related to a 2007 plant fire adversely impacted year-over-year operating profit margin comparisons. Lower year-over-
year average commodity costs, cost savings attributable to the Company’s 2008 and 2009 restructuring activities and improved productivity in the business’
manufacturing facilities partially offset these negative year-over-year factors.
Overview of Businesses within the Tools & Components Segment
Mechanics’ hand tools sales from existing businesses, representing approximately 75% of segment sales, declined 11% during 2009 as compared to 2008.
The year-over-year decline in sales is primarily a result of generally weak North American demand in the retail, industrial and mobile tool markets relating to
general economic conditions. Modest growth in the China domestic market during 2009 partially offset weak North American demand.
Sales in the segment’s niche businesses declined approximately 35% during 2009 as compared to 2008 primarily due to weak end market demand. While
demand was weak throughout 2009, the rate of sales decline during the second half of 2009 was not as pronounced as the rate of sales decline in the first half
of 2009, in part because of easier year-over-year comparisons as these businesses began experiencing revenue declines in mid-2008.
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Source: DANAHER CORP /DE/, 10-K, February 24, 2010 Powered by Morningstar® Document Research℠
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