Danaher 2013 Annual Report Download

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FORM 10-K
DANAHER CORP /DE/ - DHR
Filed: February 21, 2014 (period: December 31, 2013)
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
    ...â„ FORM 10-K DANAHER CORP /DE/ - DHR Filed: February 21, 2014 (period: December 31, 2013) 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...

  • Page 2
    ..., in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K ¨. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. nee...

  • Page 3
    ... 10, 2014 , the number of shares of Registrant's common stock outstanding was 698,482,191 . The aggregate market value of common stock held by non-affiliates of the Registrant on June 28, 2013 was $38.1 billion , based upon the closing price of the Registrant's common stock as quoted on the New York...

  • Page 4
    ...with Accountants on Accounting and Financial Disclosure Controls and Procedures Other Information 29 30 31 58 59 102 102 102 Item 10. Item 11. Item 12. Item 13. Item 14. Directors, Executive Officers and Corporate Governance Executive Compensation necurity Ownership of Certain Beneficial Owners...

  • Page 5
    ... brand names, innovative technology and major market positions. Our research and development, manufacturing, sales, distribution, service and administrative facilities are located in more than 50 countries. Our business consists of five segments: Test & Measurement; Environmental; Life nciences...

  • Page 6
    ...additional information regarding sales, operating profit and identifiable assets by segment, please refer to Note 20 in the Consolidated Financial ntatements included in this Annual Report. 2013 2012 2011 Test & Measurement Environmental Life nciences & Diagnostics Dental Industrial Technologies...

  • Page 7
    ...Test & Measurement segment manufacturing facilities are located in North America, Europe, and Asia. ENVIRONMENTTL Our Environmental segment provides products that help protect the water supply and air quality by serving two primary markets: water quality and retail/commercial petroleum. 2013 sales...

  • Page 8
    ... of the supplier's product offering and the other factors described under "-Competition." Our water quality business provides products under a variety of brands, including CHEMTREAT, HACH, HACH/LANGE and TROJAN TECHNOLOGIEn. Manufacturing facilities are located in North America, Europe, and Asia...

  • Page 9
    ... life sciences businesses offer a broad range of research and clinical tools that scientists use to study cells and cell components to understand the causes of disease, identify new therapies and test new drugs and vaccines. 2013 sales for this segment by geographic destination were: North America...

  • Page 10
    ...Our life sciences business generally markets its products under the AB nCIEX, BECKMAN COULTER, LEICA MICROnYnTEMn and MOLECULAR DEVICEn brands. Manufacturing facilities are located in Europe, Australia, Asia and North America. The businesses sell to customers primarily through direct sales personnel...

  • Page 11
    ... control solutions for the industrial automation and packaging markets. 2013 sales for this segment by geographic destination were: North America, 45%; Europe, 30%; Asia/Australia, 16% and all other regions, 9%. Our Industrial Technologies segment consists of the following lines of business. Product...

  • Page 12
    ...and X-RITE brands. Manufacturing facilities are located in North America, Europe, nouth America, and Asia. nales are generally made through our direct sales personnel and independent distributors. Motion We entered the motion control industry through the acquisition of Pacific ncientific Company in...

  • Page 13
    ... of working capital to support our business needs. There are no unusual industry practices or requirements relating to working capital items. In addition, our sales and payment terms are generally similar to those of our competitors. 11 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 Powered...

  • Page 14
    ... or acquired technology. The Company conducts research and development activities on a business-bybusiness basis, primarily in North America, Europe and Asia. We anticipate that we will continue to make significant expenditures for research and development as we seek to provide a continuing flow of...

  • Page 15
    ... material capital expenditures for environmental control facilities. For a discussion of risks related to compliance with environmental and health and safety laws, please refer to "Item 1A. Risk Factors." In addition to environmental compliance costs, we from time to time incur costs related...

  • Page 16
    ... up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for health care benefits, items or services. In addition, HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, also...

  • Page 17
    ...growth markets as developing markets of the world experiencing rapid growth in gross domestic product and infrastructure which includes Eastern Europe, the Middle East, Africa, Latin America and Asia (with the exception of Japan and Australia). 15 Source: DANAHER CORP /DE/, 10-K, February 21, 2014...

  • Page 18
    ... total annual revenue for each of the last three years ended December 31, by segment and in the aggregate, based on geographic destination: 2013 2012 2011 Test & Measurement Environmental Life nciences & Diagnostics Dental Industrial Technologies Total percentage of revenue derived from customers...

  • Page 19
    ... to respond to customers and limit our ability to increase production quickly if demand for our products increases. These circumstances could adversely impact our business and financial statements. Our growth could suffer if the markets into which we sell our products and services decline, do not...

  • Page 20
    ... 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 appropriate quality on time...

  • Page 21
    ...ventures and strategic relationships involve a number of financial, accounting, managerial, operational, legal, compliance and other risks and challenges, including the following, any of which could adversely affect our financial statements: Any acquired business, technology, service or product...

  • Page 22
    ..., as well as laws regulating fraud and abuse in the healthcare industry and the privacy and security of health information. Failure to comply with those regulations could adversely affect our reputation and financial statements. Certain of our products are medical devices and other products that are...

  • Page 23
    ... devices offered for sale in the U.n. as well as reporting and disclosure requirements on medical device manufacturers. Governmental and private healthcare providers and payors around the world are increasingly utilizing managed care for the delivery of healthcare services, forming group purchasing...

  • Page 24
    ... laws, which may affect our transactions with certain customers, business partners and other persons and dealings between our employees and subsidiaries. In certain circumstances, export control and economic sanctions regulations may prohibit the export of certain products, services and technologies...

  • 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
    ... on a timely basis to replace such production capacity. Any of these manufacturing problems could result in significant costs and liability, as well as negative publicity and damage to our reputation that could reduce demand for our products. Our indebtedness may limit our operations and our...

  • Page 27
    ... of distributors and 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 operations. As discussed in "Item 1. Business - Materials," our manufacturing...

  • Page 28
    ... and business factors could negatively affect our financial statements. In 2013, approximately 58% of our sales were derived from customers outside the U.n. In addition, many of our manufacturing operations, suppliers and employees are located outside the U.n. nince our growth strategy depends...

  • Page 29
    ... purposes, such as administration, sales, manufacturing, warehousing and/or distribution. The number of significant facilities by business segment is: Test & Measurement, 40; Environmental, 45; Life nciences & Diagnostics, 79; Dental, 31; and Industrial Technologies, 59. We consider our...

  • Page 30
    ...officers hold office at the pleasure of our Board of Directors. Unless otherwise stated, the positions indicated are Danaher positions. Name Tge Position Officer Since nteven M. Rales Mitchell P. Rales H. Lawrence Culp, Jr. Daniel L. Comas William K. Daniel II Thomas P. Joyce, Jr. James A. Lico...

  • Page 31
    ...any time. Any repurchased shares will be available for use in connection with the Company's equity compensation plans (or any successor plan) and for other corporate purposes. As of December 31, 2013, 20 million shares remained available for repurchase pursuant to the 2013 Repurchase Program. Recent...

  • Page 32
    ... Company's investment in the Apex Tool Group, LLC joint venture and $202 million ($125 million after-tax or $0.18 per diluted share) gain on sale of marketable equity securities. Refer to Notes 4 and 14, respectively, of the Notes to the Consolidated Financial ntatements for additional information...

  • Page 33
    ... experience volatility, the Company expects sales from existing businesses to grow on a year-over-year basis during 2014 with sales growth returning to the Industrial Technologies segment and the other segments growing at rates similar to those experienced in 2013. 31 Source: DANAHER CORP /DE/, 10...

  • Page 34
    ... units of the Industrial Technologies, Life nciences & Diagnostics, Environmental and Test & Measurement segments. The aggregate annual sales of these fourteen businesses at the time of their respective acquisitions, in each case based on the company's revenues for its last completed fiscal year...

  • Page 35
    ... operating profit margin comparisons were unfavorably impacted by: • The incremental net dilutive effect of acquired businesses in 2013 - 40 basis points • The divestiture of the Apex joint venture in 2013. Prior to the sale, the Company had accounted for its investment in Apex under the equity...

  • Page 36
    ... test tools, thermal imaging and calibration equipment used in electrical, industrial, electronic and calibration applications. Danaher offers test, measurement and monitoring products that are used in electronic design, manufacturing and advanced technology development; network monitoring...

  • Page 37
    ... taken in 2012 and 2011. The incremental net dilutive effect of acquired businesses adversely impacted year-over-year operating profit margin comparisons by 30 basis points. ENVIRONMENTTL Danaher's Environmental segment provides products that help protect the water supply and air quality by serving...

  • Page 38
    ...-year costs associated with various product development, sales and marketing growth investments - 70 basis points 2013 vs. 2012 operating profit margin comparisons were unfavorably impacted by: • The incremental net dilutive effect of acquired businesses in 2013 - 100 basis points 2012 COMPTRED...

  • Page 39
    ... product development, sales and marketing growth investments and the new U.n. medical device excise tax that took effect in 2013 - 190 basis points 2013 vs. 2012 operating profit margin comparisons were unfavorably impacted by: • The incremental net dilutive effect of acquired businesses in 2013...

  • Page 40
    ...driving technological innovations that help dental professionals improve clinical outcomes and enhance productivity. Dental Selected Financial Data ($ in millions) For the Year Ended December 31 2013 2012 2011 nales Operating profit Depreciation and amortization Operating profit as a % of sales...

  • Page 41
    ...industrial automation and packaging markets. In addition to the product identification and motion strategic lines of business, the segment also includes Danaher's sensors and controls, energetic materials and engine retarder businesses. The Company sold its Accu-nort ("AnI") business in January 2012...

  • Page 42
    ... costs associated with various product development, sales and marketing growth investments and the impact of lower 2013 unit sales - 80 basis points 2013 vs. 2012 operating profit margin comparisons were unfavorably impacted by: • The incremental net dilutive effect of acquired businesses in 2013...

  • Page 43
    ...'s energetic materials business increased on a year-over-year basis, partially offset by lower demand in the segment's sensors and controls and engine retarder businesses. Operating profit margins declined 30 basis points during 2012 compared to 2011. The incremental net dilutive effect of acquired...

  • Page 44
    ...the $230 million gain on the sale of Apex in 2013 and to " -Liquidity and Capital Resources - Beckman Coulter Indebtedness" below for information related to the loss on the early extinguishment of debt in 2011. 42 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 Powered by Morningstar® Document...

  • Page 45
    ... completed examinations of certain of the Company's federal income tax returns for the years 2008 and 2009 and has commenced its examinations of the Company's federal income tax returns for 2010 and 2011. In addition, the Company has subsidiaries in Belgium, Brazil, Canada, Denmark, France, Finland...

  • Page 46
    ... 31, 2013 , 2012 or 2011. FINTNCITL INSTRUMENTS TND RISK MTNTGEMENT The Company is exposed to market risk from changes in interest rates, foreign currency exchange rates, credit risk, equity prices and commodity prices, each of which could impact its financial statements. The Company generally...

  • Page 47
    ...the reported amount of sales, profit, and assets and liabilities in the Company's Consolidated Financial ntatements. In connection with a prior acquisition, the Company acquired a currency swap agreement that required the Company to purchase approximately 184 million Japanese Yen (JPY/Â¥) at a rate...

  • Page 48
    ... businesses, consummating strategic acquisitions, paying interest and servicing debt and managing its capital structure on a short and long-term basis. Following is an overview of the Company's cash flows and liquidity for the years ended December 31, 2013 , 2012 and 2011: Overview of Cash Flows...

  • Page 49
    ... on the sale of the Apex joint venture and Align common stock noted above. Net cash payments for income taxes from continuing operations totaled $529 million and $355 million in 2013 and 2012, respectively. The timing of customer deposits received in 2012 in the Test & Measurement segment's network...

  • Page 50
    ... sale of PnA of $202 million , or $0.29 per diluted share, in its second quarter 2011 results. Capital Expenditures Capital expenditures are made primarily for increasing capacity, replacing equipment, supporting new product development, improving information technology systems and the manufacture...

  • Page 51
    ... maturity and is generally based on the ratings assigned to the Company by credit rating agencies at the time of the issuance and prevailing market rates measured by reference to LIBOR. Borrowings under the program are available for general corporate purposes, including acquisitions. During 2013, as...

  • Page 52
    ... from the 2011 Financing Notes and 2013 Notes offering, after deducting expenses and the underwriters' discount, were approximately $1.8 billion and were used to fund a portion of the purchase price for the acquisition of Beckman Coulter. The Company paid interest on the 2013 Notes quarterly in...

  • Page 53
    ... corporate obligations, acquisitions, capital expenditures, share repurchases and dividends, and working capital. On June 21, 2011, the Company used its then-current shelf registration statement to complete the underwritten public offering of 19,250,000 shares of Danaher common stock at a price...

  • Page 54
    ... requirements to support working capital needs, capital expenditures and acquisitions, to pay interest and service debt, pay taxes and any related interest or penalties, fund its restructuring activities and pension plans as required, repurchase shares of the Company's common stock, pay dividends...

  • Page 55
    ... and operating cost guarantees, estimated environmental remediation costs, self-insurance and litigation claims, post-retirement benefits, pension obligations, deferred tax liabilities (excluding unrecognized tax benefits) and deferred compensation obligations. The timing of cash flows associated...

  • Page 56
    ... on its financial statements. While the Company maintains general, products, property, workers' compensation, automobile, cargo, aviation, crime, fiduciary and directors' and officers' liability insurance (and has acquired rights under similar policies in connection with certain acquisitions) up to...

  • Page 57
    ...by considering factors unique to its reporting units, including operating results, business plans, economic projections, anticipated future cash flows, and transactions and marketplace data as well as 55 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 Powered by Morningstar® Document Research...

  • Page 58
    ... projected revenue growth, future operating margins, discount rates and terminal values. There are inherent uncertainties related to these assumptions and management's judgment in applying them to the analysis of goodwill impairment. As of December 31, 2013, the Company had twenty-two reporting...

  • Page 59
    ... Company's 2013 and anticipated 2014 defined benefit pension plan contributions, please see "-Liquidity and Capital Resources Cash and Cash Requirements". Income Taxes: For a description of the Company's income tax accounting policies, refer to Notes 1 and 13 to the Company's Consolidated Financial...

  • Page 60
    ... Analysis of Financial Condition and Results of Operations." 58 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 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...

  • Page 61
    ...'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 21, 2014 appears on page 60 of th is Form 10-K. 59 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 Powered by...

  • Page 62
    Table of Contents Report of Independent Registered Public Tccounting Firm The Board of Directors and ntockholders of Danaher Corporation : We have audited Danaher Corporation and subsidiaries' internal control over financial reporting as of December 31, 2013, based on criteria established in ...

  • Page 63
    ...basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Danaher Corporation and subsidiaries at December 31, 2013 and 2012, and the consolidated results of their operations and their cash flows...

  • Page 64
    ...stock - $0.01 par value, 2.0 billion shares authorized; 785.7 and 774.6 issued; 698.1 and 687.5 outstanding, respectively Additional paid-in capital Retained earnings Accumulated other comprehensive income (loss) Total Danaher stockholders' equity Non-controlling interests Total stockholders' equity...

  • Page 65
    ... shares in millions, except per share data) Year Ended December 31 2013 2012 2011 nales Cost of sales Gross profit Operating costs and other: nelling, general and administrative expenses Research and development expenses Earnings from unconsolidated joint venture Operating profit Non-operating...

  • Page 66
    ... in millions) Year Ended December 31 2013 2012 2011 Net earnings Other comprehensive income (loss), net of income taxes: Foreign currency translation adjustments Pension and post-retirement plan benefit adjustments Unrealized gain on available-for-sale securities Total other comprehensive income...

  • Page 67
    ... activity Common stock issued in connection with LYONs' conversions Change in non-controlling interests Balance, December 31, 2013 - 7.9 $ - 4,157.6 $ 66.1 nee the accompanying Notes to the Consolidated Financial ntatements. 65 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 Powered by...

  • Page 68
    ... CONSOLIDTTED STTTEMENTS OF CTSH FLOWS ($ in millions) Year Ended December 31 2013 Cash flows from operating activities: Net earnings 2012 2011 $ Less earnings from discontinued operations, net of income taxes Net earnings from continuing operations Non-cash items: Depreciation 2,695...

  • Page 69
    ... In addition to the product identification and motion strategic lines of business, the Industrial Technologies segment also includes the Company's sensors and controls, energetic materials and engine retarder businesses. Accounting Principles -The accompanying financial statements have been prepared...

  • Page 70
    ...accounting. Equity investments are recorded at the amount of the Company's initial investment and adjusted each period for the Company's share of the investee's income or loss and dividends paid. All equity investments are periodically reviewed to determine if declines in fair value below cost basis...

  • Page 71
    ... from the sale of test and measurement, environmental, life science and diagnostic, dental and industrial technologies products and services. For revenue related to a product or service to qualify for recognition, there must be persuasive evidence of an arrangement with a customer, delivery must...

  • Page 72
    ...adoption did not have a material impact on the Company's results of operations, financial position or cash flows. Foreign currency translation adjustments are generally not adjusted for income taxes as they relate to indefinite investments in non-U.n. subsidiaries. 70 Source: DANAHER CORP /DE/, 10...

  • Page 73
    ... forfeiture rate on a straight-line basis over the requisite service period of the award, except that in the case of RnUs, compensation expense is recognized using an accelerated attribution method. Pension & Post-Retirement Benefit Plans -The Company measures its pension and post-retirement plans...

  • Page 74
    ... units of the Industrial Technologies, Life nciences & Diagnostics, Environmental and Test & Measurement segments. The aggregate annual sales of these fourteen businesses at the time of their respective acquisitions, in each case based on the company's revenues for its last completed fiscal year...

  • Page 75
    .... The additional businesses acquired complement existing units of each of the Company's five segments. The aggregate annual sales of these thirteen businesses at the time of their respective acquisitions, in each case based on the acquired company's revenues for its last completed fiscal year prior...

  • Page 76
    ... quarter 2012 results. In April 2011, the Company completed the divestiture of its Pacific ncientific Aerospace ("PnA") business for a sale price of $680 million in cash. This business, which was part of the Industrial Technologies segment had annual revenues of $377 million in 2010. The Company...

  • Page 77
    .... nubsequent to the sale of its investment in Apex, the Company has no continuing involvement in Apex's operations. (5) INVENTORIES The classes of inventory as of December 31 are summarized as follows ($ in millions): 2013 2012 Finished goods $ Work in process Raw materials Total $ 885.9 287...

  • Page 78
    ... reflected in the financial statements resulting from the Company's activities during 2013 and 2012 ($ in millions). Life Sciences & Environmental Diagnostics Test & Measurement Dental Industrial Technologies Total Balance, January 1, 2012 Attributable to 2012 acquisitions Foreign currency...

  • Page 79
    ... nonqualified deferred compensation programs that permit officers, directors and certain management employees to defer a portion of their compensation, on a pre-tax basis, until after their termination of employment (or board service, as applicable). All amounts deferred under this plan are unfunded...

  • Page 80
    ... the Company sponsored defined benefit pension plan assets. 78 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 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...

  • Page 81
    ...in millions): 2013 Current Non-Current 2012 Current Non-Current Compensation and benefits Restructuring Claims, including self-insurance and litigation Pension and post-retirement benefits Environmental and regulatory compliance Taxes, income and other Deferred revenue nales and product allowances...

  • Page 82
    ... from the 2011 Financing Notes and 2013 Notes offering, after deducting expenses and the underwriters' discount, were approximately $1.8 billion and were used to fund a portion of the purchase price for the acquisition of Beckman Coulter. The Company paid interest on the 2013 Notes quarterly in...

  • Page 83
    ... Coulter Notes"). During the third quarter of 2011, the Company retired substantially all of the Beckman Coulter Notes using proceeds from the issuance of U.n. dollar commercial paper and recorded a $33 million ($21 million , after tax or $0.03 per diluted share) charge to earnings due to "make...

  • Page 84
    ... assumptions used to determine benefit obligations at date of measurement: U.S. Plans Non-U.S. Plans 2013 2012 2013 2012 Discount rate Rate of compensation increase 4.80% N/A 3.90% N/A 3.60% 3.05% 3.45% 3.00% 82 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 Powered by Morningstar...

  • Page 85
    ... measurement: U.S. Plans Non-U.S. Plans 2013 2012 2013 2012 Discount rate Expected long-term return on plan assets Rate of compensation increase 3.90% 7.50% N/A 4.50% 7.50% N/A 3.45% 4.65% 3.00% 4.10% 4.95% 3.00% The discount rate reflects the market rate on December 31 for high-quality...

  • Page 86
    ... of the Company's pension plans recorded in the financial statements. The fair values of the Company's pension plan assets for both the U.n. and non-U.n. plans as of December 31, 2013 , by asset category were as follows ($ in millions): Significant Unobservable Inputs Quoted Prices in Tctive...

  • Page 87
    ...nubstantially all employees not covered by defined benefit plans are covered by defined contribution plans, which generally provide for Company funding based on a percentage of compensation. A limited number of the Company's subsidiaries participate in multiemployer defined benefit and contribution...

  • Page 88
    ... plans amounted to $193 million , $181 million and $166 million for the years ended December 31, 2013 , 2012 and 2011, respectively. (12) OTHER POST-RETIREMENT EMPLOYEE BENEFIT PLTNS In addition to providing pension benefits, the Company provides certain health care and life insurance benefits...

  • Page 89
    ...of the plan assets less accrued benefit costs as of December 31, 2013 . The prior service credits and actuarial gain included in accumulated comprehensive income and expected to be recognized in net periodic benefit costs during the year ending December 31, 2014 is $4 million ($3 million, net of tax...

  • Page 90
    ...have no effect on reported revenue, income or reported income tax expense. The Company evaluates the future realizability of tax credits and loss carryforwards considering the anticipated future earnings of the Company's subsidiaries as well as tax planning strategies in the associated jurisdictions...

  • Page 91
    ...to various dates from 2014 through 2033. In addition, the Company had general business and foreign tax credit carryforwards of $100 million (net of applicable valuation allowances of $5 million) as of December 31, 2013 . As of December 31, 2013 , gross unrecognized tax benefits totaled $689 million...

  • Page 92
    ... completed examinations of certain of the Company's federal income tax returns for the years 2008 and 2009 and has commenced its examinations of the Company's federal income tax returns for 2010 and 2011. In addition, the Company has subsidiaries in Belgium, Brazil, Canada, Denmark, France, Finland...

  • Page 93
    ... for all operating leases was $245 million , $247 million and $210 million for the years ended December 31, 2013 , 2012 and 2011, respectively. The Company generally accrues estimated warranty costs at the time of sale. In general, manufactured products are warranted against defects in material and...

  • Page 94
    ... statements. While the Company maintains general, products, property, workers' compensation, automobile, cargo, aviation, crime, fiduciary and directors' and officers' liability insurance (and has acquired rights under similar policies in connection with certain acquisitions) up to certain limits...

  • Page 95
    ... owned by the Company and its subsidiaries and third party sites where the Company has been determined to be a potentially responsible party. The Company generally makes an assessment of the costs involved for its remediation efforts based on environmental studies, as well as its prior experience...

  • Page 96
    ... in open market transactions at a cost of $648 million . Neither the Company nor any "affiliated purchaser" repurchased any shares of Company common stock during 2011. ntock options and RnUs have been issued to directors, officers and other employees under the Company's 1998 ntock Option Plan and...

  • Page 97
    ... were reserved for issuance under the 2007 ntock Incentive Plan. The Company accounts for stock-based compensation by measuring the cost of employee services received in exchange for all equity awards granted, including stock options, RnUs and restricted shares, based on the fair value of the award...

  • Page 98
    ... summarizes the components of the Company's stock-based compensation expense ($ in millions): Year Ended December 31 2013 2012 2011 RnUs and restricted shares: Pre-tax compensation expense Income tax benefit RnU and restricted share expense, net of income taxes $ 69.4 (20.8) $ 48.6 48.3 (14...

  • Page 99
    ...the employee, the Company derives a tax deduction measured by the excess of the market value over the grant price at the date of exercise. The Company realized a tax benefit of $52 million , $75 million , and $33 million in 2013, 2012 and 2011, respectively, related to the exercise of employee stock...

  • Page 100
    ... and reduced by the number of shares the Company could have repurchased with the proceeds from the issuance of the potentially dilutive shares. For the years ended December 31, 2013 , 2012 and 2011, approximately 2 million, 2 million and 3 million options to purchase shares, respectively, were not...

  • Page 101
    ...the Test & Measurement, Environmental, Life nciences & Diagnostics, Dental and Industrial Technologies segments. In addition, the Company's equity in earnings of the Apex joint venture is shown separately in the Company's segment disclosures. Operating profit represents total revenues less operating...

  • Page 102
    ... 5% of total long-lived assets) Total $ $ $ Sales by Major Product Group Year Ended December 31 ($ in millions) 2013 2012 2011 Analytical & physical instrumentation Medical & dental products Motion & industrial automation controls Product identification All other Total $ $ 6,278.5 8,958...

  • Page 103
    ...in millions, except per share data) 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 2013: Net sales Gross profit Operating profit Net earnings Net earnings per share: Basic Diluted 2012: Net sales Gross profit Operating profit Net earnings from continuing operations Net earnings Net earnings per...

  • Page 104
    ... Annual Report on Form 10-K, under the headings "Report of Management on Danaher Corporation's Internal Control Over Financial Reporting" and "Report of Independent Registered Public Accounting Firm," respectively, and are incorporated herein by reference. There have been no changes in the Company...

  • Page 105
    ... by reference from the sections entitled Beneficial Ownership of Danaher Common Stock by Directors, Officers and Principal Shareholders and Equity Compensation Plan Information in the Proxy ntatement for the Company's 2014 annual meeting. ITEM 13. CERTTIN RELTTIONSHIPS TND RELTTED TRTNSTCTIONS, TND...

  • Page 106
    ... Exhibit 3.1 to Danaher Corporation's Quarterly Report on Form 10-Q for the quarter ended June 29, 2012 (Commission File Number: 1-8089) Incorporated by reference from Exhibit 3.2 to Danaher Corporation's Annual Report on Form 10-K for the year ended December 31, 2011 (Commission File Number: 1-8089...

  • Page 107
    ...10.3 to Danaher Corporation's Quarterly Report on Form 10-Q for the quarter ended June 28, 2013 (Commission File Number: 1-8089) Danaher Corporation 2007 ntock Incentive Plan, as amended* 10.2 Danaher Corporation Non-Employee Directors' Deferred Compensation Plan, as amended, a sub-plan under the...

  • Page 108
    ... between Danaher Corporation and H. Lawrence Culp, Jr., dated as of July 18, 2000 and as subsequently amended* Form of Proprietary Interest Agreement for Named Executive Officers (with severance) (1)* 10.15 10.16 Description of compensation arrangements for nonmanagement directors* 10.17 Credit...

  • Page 109
    ....35 to Danaher Corporation's Annual Report on Form 10-K for the year ended December 31, 2008 (Commission File Number: 1-8089) 10.26 Aircraft Time nharing Agreement by and between Danaher Corporation and H. Lawrence Culp, Jr., dated December 18, 2012 (4) Form of Director and Officer Indemnification...

  • Page 110
    ... 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...

  • Page 111
    ... aircraft and, in certain cases, the name of the counterparty. In accordance with Instruction 2 to Item 601(a)(4) of Regulation n-K, Danaher Corporation has entered into an aircraft time sharing agreement with Daniel L. Comas that is substantially identical in all material respects to the form of...

  • Page 112
    ...: Name, Title and nignature Date /s/ nTEVEN M. RALEn nteven M. Rales Chairman of the Board February 20, 2014 /s/ MITCHELL P. RALEn Mitchell P. Rales Chairman of the Executive Committee February 20, 2014 /s/ H. LAWRENCE CULP, JR. H. Lawrence Culp, Jr. President, Chief Executive Officer and...

  • Page 113
    /s/ DANIEL L. COMAn Daniel L. Comas Executive Vice President and Chief Financial Officer February 20, 2014 /s/ ROBERT n. LUTZ Robert n. Lutz nenior Vice President and Chief Accounting Officer February 20, 2014 110 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 Powered by Morningstar® ...

  • Page 114
    ... Notes: (a) Amounts include allowance for doubtful accounts classified as current and non-current. (b) Amounts related to businesses acquired, net of amounts related to businesses disposed. 111 Source: DANAHER CORP /DE/, 10-K, February 21, 2014 Powered by Morningstar® Document Research℠The...

  • Page 115
    Exhibit 10.16 Danaher Corporation Description of Non-Management Director Compensation Arrangements Effective as tf July 2013, each ntnomanagement directtr receives: • an annual cash retainer tf $100,000, paid in ftur, equal installments ftlltwing each quarter tf service; • if a directtr attends...

  • Page 116
    ...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 2009 2010 2013 Fixed Charges: Gross Interest Expense Interest Element of Rental Expense Interest on Unrecognized Tax Benefits $ Total...

  • Page 117
    ... States Sweden Australia Germany Turkey Canada Czech Republic China Mexico Brazil Croatia Spain Switzerland France Germany Hong Kong United States India Switzerland Ireland Japan Korea, Republic of China Russian Federation Hungary Japan Source: DANAHER CORP /DE/, 10-K, February 21, 2014 Powered...

  • Page 118
    ... Limited Danaher China Holdings Limited Danaher Evolution GmbH Danaher Holding B.V. Danaher Medical ApS Danaher Setra-ICG (Tianjin) Co. Ltd. Danaher UK Industries Limited DANRAD ApS DATAPAQ Limited Dental Complex Dental Equipment, LLC Dental Imaging Technologies Corporation DH Business Services...

  • Page 119
    ...Limited Fluke Sales B.V. Fluke Shanghai Corporation Fluke Software Ireland Limited Fullerton LLC Gems Sensors Inc. Genetix Group Limited Gilbarco Australia Pty Ltd Gilbarco China Co. Ltd Gilbarco GmbH & Co. KG Gilbarco Inc. Gilbarco S.r.l. Gilbarco Veeder Root India Private Limited Hach Company Hach...

  • Page 120
    ... Motion Engineering Incorporated Navman Wireless Australia Pty.Ltd. Navman Wireless Holdings LP Navman Wireless North America Ltd. Navman Wireless UK ltd. Negele Messtechnik GmbH Neoptix Canada LP NMTC, Inc. Ormco BV Ormco Corporation OTT Hydromet GmbH Pacific Scientific Energetic Materials Company...

  • Page 121
    ... Sales GmbH Tektronix Texas, LLC Tektronix U.K. Holdings Limited Teletrac Holdings Inc. Teletrac, Inc. Thomson Industries, Inc. Thomson Linear LLC Thomson Neff GmbH Tianjin Danaher Motion Co. Ltd. Trojan Technologies U.S. Peroxide, LLC Veeder-Root Company Venture Measurement Company LLC Videojet...

  • Page 122
    ... Technologies (Shanghai) Co., Ltd. Videojet Technologies JSC Viqua VSS Monitoring, Inc. X-Ray Optical Systems, Inc. X-Rite Asia Pacific Limited X-Rite Europe GmbH X-Rite GmbH X-Rite, Incorporated Netherlands Germany United States United Kingdom Mexico France China Russian Federation Canada...

  • Page 123
    ... Annual Report (Form 10-K) of Danaher Corporation and subsidiaries for the year ended December 31, 2013. Registration Statement on Form S-3 Registration Number Date Filed 333-181214 May 7, 2012 Registration Statements on Form S-8 Name Registration Number Date Filed Tektronix, Inc. 2005 Stock...

  • Page 124
    ... management or other employees who have a significant role in the registrant's internal control over financial reporting. b. Date: February 20, 2014 By: Name: Title: /s/ H. Lawrence Culp, Jr. H. Lawrence Culp, Jr. President and Chief Executive Officer Source: DANAHER CORP /DE/, 10-K, February...

  • Page 125
    ... involves management or other employees who have a significant role in the registrant's internal control over financial reporting. b. Date: February 20, 2014 By: Name: Title: /s/ Daniel L. Comas Daniel L. Comas Executive Vice President and Chief Financial Officer Source: DANAHER CORP /DE/, 10...

  • Page 126
    ... presents in all material respects the financial condition and results of operations of Danaher Corporation. Date: February 20, 2014 By: Name: Title: /s/ H. Lawrence Culp, Jr. H. Lawrence Culp, Jr. President and Chief Executive Officer This certification accompanies the Annual Report on Form 10...

  • Page 127
    ... presents in all material respects the financial condition and results of operations of Danaher Corporation. Date: February 20, 2014 By: Name: Title: /s/ Daniel L. Comas Daniel L. Comas Executive Vice President and Chief Financial Officer This certification accompanies the Annual Report on Form...

  • Page 128
    ... 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...