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Danaher Q1 Revenues Increase 11 Percent

The story has been updated to include comments from Danaher's CEO.

By a GenomeWeb staff reporter

NEW YORK (GenomeWeb News) – Danaher today reported an 11 percent rise in first-quarter sales with its Life Sciences and Diagnostics segment jumping 22 percent.

For the three months ended April 1, the Washington-based conglomerate said that total sales came in at $3.35 billion, compared to $3.01 billion the year before. Wall Street had a consensus estimate of $3.32 billion.

In Life Sciences and Diagnostics, sales increased to $626.6 million from $516.5 million during the first quarter of 2010. Within the segment, sales from existing businesses in life science instruments and pathology diagnostics rose at a high-single digit rate year over year, with strong demand in all major geographies for new instruments and consumables, Danaher said in its Form 10-Q filed with the US Securities and Exchange Commission.

Its mass spectrometry operations, housed in the AB Sciex business, also grew at a high-single digit rate, driven by strong demand across the academic, proteomics, and applied markets, the company added.

A full year into Danaher's acquisition of AB Sciex from Life Technologies, the company is "clearly seeing the benefits of new products, a much more focused go-to-market effort, and the implementation" of the Danaher Business System, a process to improve productivity, Larry Culp, Danaher's CEO, said during a conference call following the result of the earnings results. Without elaborating, he hinted that there could be significant AB Sciex launches at the American Society for Mass Spectrometry conference in June.

For the quarter, Danaher posted a profit of $429.4 million, or $.63 per share, up 43 percent from a year-ago profit of $300.2 million, or $.45 per share. On an adjusted basis, EPS came in at $.61, beating analyst estimates of $.57.

Its R&D spending for the first quarter totaled $217.6 million, up 20 percent from $180.8 million a year ago, while SG&A costs increased 12 percent to $969.7 million from $866.3 million a year ago.

The company said it had $1.59 billion in cash and cash equivalents as of April 1.

Danaher said after the close of the market on Wednesday that it had extended its tender offer to acquire all of the shares of Beckman Coulter to expire at midnight EDT June 6. The offer was originally set to expire on March 23 and had been extended once to expire on April 27.

All other terms and conditions of the $6.8 billion proposed acquisition remain the same. The company received early termination of the review period under the Hart-Scott-Rodino Antitrust Improvement Act of 1976 last month and is seeking clearances under similar antitrust and competition laws in other jurisdictions.

Earlier this week, Beckman Coulter disclosed in a document filed with the US Food and Drug Administration that its two submissions to the FDA for the troponin test on its DxI and Access instruments are expected to be delayed until the third quarter.

In January, the firm said it anticipated filing its 510(k) applications in May or June.

Today, Culp said that given the complexity of the tests and of the submission process, "the delay here is not something that in our view is unanticipated," and added that the delay is not material.

Culp also said that the company remains to be "very much in the deal game, not as much as we typically would be." For the balance of 2011, Danaher is looking at potentially spending about $300 in M&A. In 2012, after the Beckman Coulter deal has been completed, Danaher will return to the $2 billion range in potential M&A, he said.

In later afternoon trading Thursday trade on the New York Stock Exchange, shares of Danaher were down almost 1 percent at $53.06.

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