Industrial conglomerate Danaher Corp. raised its guidance for the year after reporting its profit shot up 33 per cent in the first quarter of the year and results topped expectations as recent acquisitions padded results in the face of currency challenges.
For the year, the company now anticipates adjusted earnings of $4.85 to $4.98 a share, up from its previous forecast for $4.80 to $4.95 a share. But for the second quarter, the company expects adjusted earnings in the range of $1.19 to $1.23 a share, just below analysts’ forecast for $1.24 a share.
Chief Executive Thomas Joyce said the company outperformed “in the face of uncertain and challenging economic conditions”, pointing to high-teens earnings growth, healthy operating margin expansion and free cash flow up more than 50 per cent year-on-year.
Acquisitions helped the Washington, DC-based company to increase its top-line growth by 16.5 per cent. Still, the company faced foreign-exchange volatility that it said reduced its top line by 2 per cent.
For the quarter ended April 1, the company posted a profit of $758.4 million, or $1.09 a share, up from $569.8 million or 79 cents a share a year earlier. Excluding certain items, earnings on a per-share basis rose to $1.08 from 91 cents a year earlier.
Revenue climbed 15 per cent to $5.39 billion. Revenue excluding the boon from acquisitions edged up 0.5 per cent.
Danahar had forecast adjusted earnings of $1 to $1.04 a share. Analysts were looking for $5.33 billion in revenue.
Last May, Danaher Corp said it agreed to buy Pall Corp. for about $13.6 billion and unveiled plans to split itself into two separate companies.
Pall, based in Port Washington, NY, sells purification and filtration products to a wide range of customers, including biopharmaceutical companies, airplane manufactures, brewers and municipal water suppliers.
The two resulting businesses would be a science and technology company, which would include Pall, and an industry company. The science business is slated to keep the Danaher name and include Danaher’s life-sciences and diagnostics and dental segments, as well as its water-quality and product-identification platforms. The company hopes to complete the split around the end of 2016.
Shares in the company, inactive pre-market, have risen 13 per cent over the past three months. – Anne Steele