Fortive Corporation ("Fortive") (NYSE: FTV) today announced results for
the fourth quarter 2016. Prior to July 2, 2016, Fortive operated as part
of Danaher Corporation ("Danaher") and the historical financial measures
presented in this announcement for periods prior to July 2, 2016 were
derived from Danaher's accounting records and are presented on a
carved-out basis.
For the fourth quarter ended December 31, 2016, net earnings were $224.5
million. For the same period, non-GAAP adjusted net earnings were $237.7
million. Diluted net earnings per share for the fourth quarter ended
December 31, 2016 were $0.64. For the same period, non-GAAP adjusted
diluted net earnings per share were $0.68.
For the fourth quarter of 2016, GAAP revenues increased 3.3%
year-over-year to $1.6 billion, with core revenue growth of 3.5%.
James A. Lico, President and Chief Executive Officer, stated, "We are
pleased with our fourth quarter results as the team leveraged the power
of the Fortive Business System to once again deliver core sales growth,
cash flow generation and earnings outperformance. We ended the year
well-positioned for expected continued growth around the world and
across our diverse businesses."
For the first quarter of 2017, Fortive anticipates diluted net earnings
per share to be in the range of $0.51 to $0.55 and the non-GAAP adjusted
diluted net earnings per share to be in the range of $0.54 to $0.58.
Fortive expects 2017 diluted net earnings per share to be in the range
of $2.48 to $2.58 and non-GAAP adjusted diluted net earnings per share
to be in the range of $2.60 to $2.70.
Mr. Lico added, "We enter 2017 with momentum and absolute dedication
toward our purpose to deliver essential technology for the people who
accelerate progress. The Fortive Business System is the underpinning to
our culture of accountability and continuous improvement and the
playbook for creating long-term shareholder value. We look forward to
the year ahead."
Fortive will discuss results and outlook during its quarterly investor
conference call today starting at 5:30 p.m. ET. The call and an
accompanying slide presentation will be webcast on the "Investors"
section of the website, www.fortive.com,
under "Events & Presentations." A replay of the webcast will be
available at the same location shortly after the conclusion of the
presentation and will remain available until the next quarterly earnings
call.
The conference call can be accessed by dialing 800-533-7954 within the
U.S. or by dialing 785-830-1924 outside the U.S. a few minutes
before 5:30 p.m. ET and notifying the operator that you are dialing in
for Fortive's earnings conference call (access code 8278895). A replay
of the conference call will be available shortly after the conclusion of
the call until Tuesday, February 14, 2017. Once available, click here to
access the conference call replay or visit the "Investors" section of
the website under "Events & Presentations."
ABOUT FORTIVE
Fortive is a diversified industrial growth company comprised of
Professional Instrumentation and Industrial Technologies businesses that
are recognized leaders in attractive markets. With 2016 revenues of $6.2
billion, our well-known brands hold leading positions in field
solutions, transportation technology, sensing, product realization,
automation and specialty, and franchise distribution markets. We are
headquartered in Everett, Washington and employ a team of more than
24,000 research and development, manufacturing, sales, distribution,
service and administrative employees in more than 40 countries around
the world. With a culture rooted in continuous improvement, the core of
our operating model is the Fortive Business System. For more information
please visit: www.fortive.com.
NON-GAAP FINANCIAL MEASURES
In addition to the financial measures prepared in accordance with
generally accepted accounting principles (GAAP), this earnings release
also references "adjusted net earnings," "adjusted diluted net earnings
per share," and "core revenue," which are non-GAAP financial measures.
The reasons why we believe these measures, when used in conjunction with
the GAAP financial measures, provide useful information to investors,
how management uses such non-GAAP financial measures, a reconciliation
of these measures to the most directly comparable GAAP measures and
other information relating to these measures are included in the
supplemental reconciliation schedule attached. The non-GAAP financial
measures should not be considered in isolation or as a substitute for
the GAAP financial measures, but should instead be read in conjunction
with the GAAP financial measures. The non-GAAP financial measures used
by Fortive in this release may be different from similarly-titled
non-GAAP measures used by other companies.
FORWARD-LOOKING STATEMENTS
Statements in this release that are not strictly historical, including
the statements regarding Fortive's anticipated diluted net earnings per
share, adjusted diluted net earnings per share, core revenue growth,
growth opportunities, capital allocation, acquisitions, economic
conditions, future prospects, and any other statements identified by
their use of words like "anticipate," "expect," "believe," "outlook,"
"guidance," or "will" or other words of similar meaning are
"forward-looking" statements within the meaning of the federal
securities laws. There are a number of important factors that could
cause actual results, developments and business decisions to differ
materially from those suggested or indicated by such forward-looking
statements and you should not place undue reliance on any such
forward-looking statements. These factors include, among other things,
deterioration of or instability in the economy, the markets we serve and
the financial markets, contractions or lower growth rates and
cyclicality of markets we serve, competition, changes in industry
standards and government regulation, our ability to successfully
identify, consummate, integrate and realize the anticipated value of
appropriate acquisitions and successfully complete divestitures and
other dispositions, our ability to develop and successfully market new
products, software, and services and expand into new markets, the
potential for improper conduct by our employees, agents or business
partners, contingent liabilities relating to acquisitions and
divestitures, adequacy of indemnification we receive from sellers in our
acquisitions, our ability to comply with extensive regulation, risks
relating to potential impairment of goodwill and other intangible
assets, currency exchange rates, tax audits and changes in our tax rate
and income tax liabilities, the impact of our debt obligations on our
operations, litigation and other contingent liabilities including
intellectual property and environmental, health and safety matters,
risks relating to product, service or software defects, product
liability and recalls, risks relating to product manufacturing, the
impact of our debt obligations on our operations and liquidity, our
relationships with and the performance of our channel partners,
commodity costs and surcharges, our ability to adjust purchases and
manufacturing capacity to reflect market conditions, reliance on sole
sources of supply, labor matters, international economic, political,
legal, compliance and business factors, adverse effects of restructuring
activities, any work stoppages, disruptions relating to man-made and
natural disasters, security breaches or other disruptions of our
information technology systems, impact of our separation from Danaher on
our operations, impact of our indemnification obligation to and from
Danaher, qualification of the separation as a tax-free transaction, and
transactional and execution related liabilities resulting from our
separation from Danaher. Additional information regarding the factors
that may cause actual results to differ materially from these
forward-looking statements is available in our SEC filings, including
the Information Statement we furnished with the Current Report on Form
8-K filed on June 15, 2016. These forward-looking statements speak only
as of the date of this release, and Fortive does not assume any
obligation to update or revise any forward-looking statement, whether as
a result of new information, future events and developments or otherwise.
|
|
FORTIVE CORPORATION AND SUBSIDIARIES
CONSOLIDATED AND
COMBINED BALANCE SHEETS
($ and shares in millions,
except per share amounts)
(unaudited)
|
|
|
|
|
|
As of December 31
|
|
|
|
2016
|
|
2015
|
|
ASSETS
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and equivalents
|
|
$
|
803.2
|
|
|
$
|
—
|
|
|
Trade accounts receivable less allowance for doubtful accounts of
$47.8 million and $45.6 million, respectively
|
|
945.4
|
|
|
979.3
|
|
|
Inventories
|
|
544.6
|
|
|
522.9
|
|
|
Prepaid expenses and other current assets
|
|
195.5
|
|
|
91.9
|
|
|
Total current assets
|
|
2,488.7
|
|
|
1,594.1
|
|
|
Property, plant and equipment, net
|
|
547.6
|
|
|
514.8
|
|
|
Other assets
|
|
427.2
|
|
|
393.7
|
|
|
Goodwill
|
|
3,979.0
|
|
|
3,949.0
|
|
|
Other intangible assets, net
|
|
747.3
|
|
|
759.0
|
|
|
Total assets
|
|
$
|
8,189.8
|
|
|
$
|
7,210.6
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Trade accounts payable
|
|
$
|
666.2
|
|
|
$
|
657.1
|
|
|
Accrued expenses and other current liabilities
|
|
800.3
|
|
|
666.4
|
|
|
Total current liabilities
|
|
1,466.5
|
|
|
1,323.5
|
|
|
Other long-term liabilities
|
|
674.3
|
|
|
704.6
|
|
|
Long-term debt
|
|
3,358.0
|
|
|
—
|
|
|
Equity:
|
|
|
|
|
|
Preferred stock: $0.01 par value, 15 million and 100 shares
authorized, respectively; no shares issued or outstanding in either
period
|
|
—
|
|
|
—
|
|
|
Common stock: $0.01 par value, 2.0 billion and 100 shares
authorized; 346.0 million and 100 shares issued; 345.9 million and
100 shares outstanding, respectively
|
|
3.5
|
|
|
—
|
|
|
Additional paid-in capital
|
|
2,427.2
|
|
|
—
|
|
|
Retained earnings
|
|
403.0
|
|
|
—
|
|
|
Former Parent's investment, net
|
|
—
|
|
|
5,193.9
|
|
|
Accumulated other comprehensive income (loss)
|
|
(145.8
|
)
|
|
(14.4
|
)
|
|
Total Fortive stockholders' equity
|
|
2,687.9
|
|
|
5,179.5
|
|
|
Noncontrolling interests
|
|
3.1
|
|
|
3.0
|
|
|
Total stockholders' equity
|
|
2,691.0
|
|
|
5,182.5
|
|
|
Total liabilities and stockholders' equity
|
|
$
|
8,189.8
|
|
|
$
|
7,210.6
|
|
|
|
This information is presented for reference only. Final audited
financial statements will include footnotes, which should be referenced
when available, to more fully understand the contents of this
information.
|
|
FORTIVE CORPORATION AND SUBSIDIARIES
CONSOLIDATED AND
COMBINED STATEMENTS OF EARNINGS
($ and shares in
millions, except per share amounts)
(unaudited)
|
|
|
|
|
|
Three Months Ended December 31
|
|
Year Ended December 31
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Sales
|
|
$
|
1,627.1
|
|
|
$
|
1,575.8
|
|
|
$
|
6,224.3
|
|
|
$
|
6,178.8
|
|
|
Cost of sales
|
|
|
(830.5
|
)
|
|
|
(818.5
|
)
|
|
|
(3,191.5
|
)
|
|
|
(3,178.8
|
)
|
|
Gross profit
|
|
|
796.6
|
|
|
|
757.3
|
|
|
|
3,032.8
|
|
|
|
3,000.0
|
|
|
Operating costs:
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses
|
|
|
(359.7
|
)
|
|
|
(328.2
|
)
|
|
|
(1,402.0
|
)
|
|
|
(1,352.6
|
)
|
|
Research and development expenses
|
|
|
(99.2
|
)
|
|
|
(91.0
|
)
|
|
|
(384.8
|
)
|
|
|
(377.7
|
)
|
|
Operating profit
|
|
|
337.7
|
|
|
|
338.1
|
|
|
|
1,246.0
|
|
|
|
1,269.7
|
|
|
Nonoperating expense
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
(22.9
|
)
|
|
|
—
|
|
|
|
(49.0
|
)
|
|
|
—
|
|
|
Earnings before income taxes
|
|
|
314.8
|
|
|
|
338.1
|
|
|
|
1,197.0
|
|
|
|
1,269.7
|
|
|
Income taxes
|
|
|
(90.3
|
)
|
|
|
(102.0
|
)
|
|
|
(324.7
|
)
|
|
|
(405.9
|
)
|
|
Net earnings
|
|
$
|
224.5
|
|
|
$
|
236.1
|
|
|
$
|
872.3
|
|
|
$
|
863.8
|
|
|
Net earnings per share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.65
|
|
|
$
|
0.68
|
|
|
$
|
2.52
|
|
|
$
|
2.50
|
|
|
Diluted
|
|
$
|
0.64
|
|
|
$
|
0.68
|
|
|
$
|
2.51
|
|
|
$
|
2.50
|
|
|
Average common stock and common equivalent shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
346.2
|
|
|
|
345.2
|
|
|
|
345.7
|
|
|
|
345.2
|
|
|
Diluted
|
|
|
349.7
|
|
|
|
345.2
|
|
|
|
347.3
|
|
|
|
345.2
|
|
|
|
This information is presented for reference only. Final audited
financial statements will include footnotes, which should be referenced
when available, to more fully understand the contents of this
information.
|
|
FORTIVE CORPORATION AND SUBSIDIARIES
CONSOLIDATED AND
COMBINED STATEMENTS OF CASH FLOWS
($ in millions)
(unaudited)
|
|
|
|
|
|
Year Ended December 31
|
|
|
|
2016
|
|
2015
|
|
Cash flows from operating activities:
|
|
|
|
|
|
Net earnings
|
|
$
|
872.3
|
|
|
$
|
863.8
|
|
|
Noncash items:
|
|
|
|
|
|
Depreciation
|
|
|
90.7
|
|
|
|
88.1
|
|
|
Amortization
|
|
|
85.7
|
|
|
|
88.8
|
|
|
Stock-based compensation expense
|
|
|
45.3
|
|
|
|
35.2
|
|
|
Impairment charge on intangible assets
|
|
|
4.8
|
|
|
|
12.0
|
|
|
Change in deferred income taxes
|
|
|
(10.0
|
)
|
|
|
8.0
|
|
|
Change in trade accounts receivable, net
|
|
|
24.8
|
|
|
|
(51.8
|
)
|
|
Change in inventories
|
|
|
(28.7
|
)
|
|
|
(27.7
|
)
|
|
Change in trade accounts payable
|
|
|
17.2
|
|
|
|
53.6
|
|
|
Change in prepaid expenses and other assets
|
|
|
(16.3
|
)
|
|
|
(61.3
|
)
|
|
Change in accrued expenses and other liabilities
|
|
|
51.1
|
|
|
|
0.3
|
|
|
Net cash provided by operating activities
|
|
|
1,136.9
|
|
|
|
1,009.0
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
Cash paid for acquisitions
|
|
|
(190.1
|
)
|
|
|
(37.1
|
)
|
|
Payments for additions to property, plant and equipment
|
|
|
(129.6
|
)
|
|
|
(120.1
|
)
|
|
All other investing activities
|
|
|
8.9
|
|
|
|
(16.9
|
)
|
|
Net cash used in investing activities
|
|
|
(310.8
|
)
|
|
|
(174.1
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
Net proceeds from borrowings (maturities of 90 days or less)
|
|
|
375.2
|
|
|
|
—
|
|
|
Proceeds from borrowings (maturities longer than 90 days)
|
|
|
2,978.1
|
|
|
|
—
|
|
|
Cash dividend paid to Former Parent
|
|
|
(3,000.0
|
)
|
|
|
—
|
|
|
Payment of cash dividends to shareholders
|
|
|
(48.4
|
)
|
|
|
—
|
|
|
Net transfers to Former Parent
|
|
|
(301.4
|
)
|
|
|
(834.9
|
)
|
|
All other financing activities
|
|
|
0.3
|
|
|
|
—
|
|
|
Net cash provided by (used in) financing activities
|
|
|
3.8
|
|
|
|
(834.9
|
)
|
|
Effect of exchange rate changes on cash and equivalents
|
|
|
(26.7
|
)
|
|
|
—
|
|
|
Net change in cash and equivalents
|
|
|
803.2
|
|
|
|
—
|
|
|
Beginning balance of cash and equivalents
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Ending balance of cash and equivalents
|
|
$
|
803.2
|
|
|
$
|
—
|
|
|
|
This information is presented for reference only. Final audited
financial statements will include footnotes, which should be referenced
when available, to more fully understand the contents of this
information.
|
|
FORTIVE CORPORATION AND SUBSIDIARIES
SEGMENT
INFORMATION
($ in millions)
(unaudited)
|
|
|
|
|
|
Three Months Ended December 31
|
|
Year Ended December 31
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Sales:
|
|
|
|
|
|
|
|
|
|
Professional Instrumentation
|
|
$
|
746.5
|
|
|
$
|
744.5
|
|
|
$
|
2,891.6
|
|
|
$
|
2,974.2
|
|
|
Industrial Technologies
|
|
|
880.6
|
|
|
|
831.3
|
|
|
|
3,332.7
|
|
|
|
3,204.6
|
|
|
Total
|
|
$
|
1,627.1
|
|
|
$
|
1,575.8
|
|
|
$
|
6,224.3
|
|
|
$
|
6,178.8
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Profit:
|
|
|
|
|
|
|
|
|
|
Professional Instrumentation
|
|
$
|
172.4
|
|
|
$
|
180.8
|
|
|
$
|
642.3
|
|
|
$
|
694.8
|
|
|
Industrial Technologies
|
|
|
182.7
|
|
|
|
167.8
|
|
|
|
667.4
|
|
|
|
617.2
|
|
|
Other
|
|
|
(17.4
|
)
|
|
|
(10.5
|
)
|
|
|
(63.7
|
)
|
|
|
(42.3
|
)
|
|
Total
|
|
$
|
337.7
|
|
|
$
|
338.1
|
|
|
$
|
1,246.0
|
|
|
$
|
1,269.7
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Margins:
|
|
|
|
|
|
|
|
|
|
Professional Instrumentation
|
|
|
23.1
|
%
|
|
|
24.3
|
%
|
|
|
22.2
|
%
|
|
|
23.4
|
%
|
|
Industrial Technologies
|
|
|
20.7
|
%
|
|
|
20.2
|
%
|
|
|
20.0
|
%
|
|
|
19.3
|
%
|
|
Total
|
|
|
20.8
|
%
|
|
|
21.5
|
%
|
|
|
20.0
|
%
|
|
|
20.5
|
%
|
|
|
This information is presented for reference only. Final audited
financial statements will include footnotes, which should be referenced
when available, to more fully understand the contents of this
information.
FORTIVE CORPORATION AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
Adjusted Net Earnings and Adjusted Diluted Net Earnings per Share
We disclose the non-GAAP measures of historical adjusted net earnings
and historical and forecasted adjusted diluted net earnings per share,
which make the following adjustments to GAAP net earnings and GAAP
diluted net earnings per share, respectively:
-
Excluding on a pretax basis amortization of acquisition-related
intangible assets;
-
Excluding the tax effect of the adjustment noted above as well as for
the Separation Adjustments (described below); provided, however, that
the tax effect of such adjustments was calculated: (a) with respect to
the historical adjusted net earnings and adjusted diluted net earnings
per share for the three-month period ended December 31, 2016 and the
forecasted adjusted diluted net earnings per share, by applying our
overall estimated effective tax rate to the pretax amount of each
adjustment (unless the nature of the item and/or the tax jurisdiction
in which the item has been recorded requires application of a specific
tax rate or tax treatment, in which case the tax effect of such item
is estimated by applying such specific tax rate or tax treatment); and
(b) with respect to the adjusted net earnings for the three month
period ended December 31, 2015, by applying our statutory tax rate. We
are applying the statutory tax rate for the period ended December 31,
2015 because such tax rate was applied in our prior adjusted net
earnings disclosed and applied in a manner consistent with Article 11
of Regulation S-X. We are applying the estimated effective tax rate to
each adjustment for the period ended December 31, 2016 and for the
forecasted periods to facilitate comparisons in future periods. The
tax effect of the adjustments to net earnings for the three-month
period ended December 31, 2016 would have been $6.9 million instead
of $5.3 million had we applied the statutory tax rate instead of our
overall estimated effective tax rate.
While we have a history of acquisition activity, we do not acquire
businesses on a predictable cycle, and the amount of an acquisition's
purchase price allocated to intangible assets and related amortization
term are unique to each acquisition and can vary significantly from
acquisition to acquisition. We believe however that it is important for
investors to understand that such intangible assets contribute to
revenue generation and that intangible assets related to past
acquisitions will recur in future periods until such intangible assets
have been fully amortized. Furthermore, the forecasted adjusted diluted
net earnings per share does not reflect certain adjustments that are
inherently difficult to predict or estimate due to their unknown timing,
effect and/or significance.
In addition, because we were part of Danaher for the three month period
ended December 31, 2015, we are also making the following adjustments to
the corresponding historical GAAP net earnings as if the Separation had
been effectuated at the beginning of the relevant period (the
"Separation Adjustments"):
-
Because the carved-out GAAP financial measures for the three-month
period ended December 31, 2015 did not reflect the level of selling,
general and administrative expenses, including stock-based
compensation, that would have been incurred as a stand-alone, publicly
traded company ("Estimated SG&A Level"), adding on a pretax basis
additional expenses necessary for such costs to equal the Estimated
SG&A Level; and
-
Adding interest expenses on a pretax basis (based on the assumed
borrowing cost of approximately 2.8% per annum) as if the outstanding
indebtedness incurred in connection with the Separation had been
incurred at the beginning of such period ("Additional Interest
Expense").
Management believes that the Separation Adjustments, when considered
together with the corresponding carved-out GAAP financial measures,
provide useful information to investors by helping to identify certain
types or levels of additional expenses incurred as a stand-alone,
publicly traded company after the Separation that may not have been
allocated or reflected in the historical carved-out GAAP financial
measures for periods in which we were part of Danaher. We believe that
such adjustments, when presented with the corresponding carved-out GAAP
measures, may assist in assessing the business trends and making
comparisons of long-term performance before and after the Separation. We
will not make the Separation Adjustments for any periods in which the
Separation had been effectuated prior to the beginning of such period.
Management believes that these non-GAAP financial measures provide
useful information to investors by reflecting additional ways of viewing
aspects of Fortive's operations that, when reconciled to the
corresponding GAAP measure, help our investors to understand the
long-term profitability trends of our business, and facilitate
comparisons of our profitability to prior and future periods and to our
peers. The items described above have been excluded from, or added to,
these measures because items of this nature and/or size occur with
inconsistent frequency or occur for reasons that may be unrelated to our
commercial performance during the period and/or because we believe the
corresponding adjustments are useful in assessing our potential ongoing
operating costs or gains in a given period.
We deem acquisition-related transaction costs incurred in a given period
to be significant (generally relating to our larger acquisitions) if we
determine that such costs exceed the range of our typical
acquisition-related transaction costs in a given period.
These non-GAAP measures should be considered in addition to, and not as
a replacement for or superior to, the comparable GAAP measures, and may
not be comparable to similarly titled measures reported by other
companies.
Core Revenue
We use the term "core revenue" when referring to a corresponding GAAP
revenue measure, excluding (1) sales impacts from acquired businesses,
(2) sales impacts from the Separation and (3) the impact of currency
translation. References to sales or operating profit attributable to
acquisitions or acquired businesses refer to GAAP sales or operating
profit, as applicable, from acquired businesses recorded prior to the
first anniversary of the acquisition less the amount of sales or
operating profit, as applicable, attributable to certain divested
businesses or product lines not considered discontinued operations prior
to the first anniversary of the divestiture. Sales impacts from the
Separation refer to sales to or from Danaher made under agreements
entered into, or terminated, in connection with the Separation prior to
the first anniversary of the Separation. The portion of sales
attributable to the impact of currency translation is calculated as the
difference between (a) the period-to-period change in sales (excluding
sales from acquired businesses or the Separation) and (b) the
period-to-period change in sales (excluding sales from acquired
businesses or the Separation) after applying the current period foreign
exchange rates to the prior year period. These non-GAAP measures should
be considered in addition to, and not as a replacement for or superior
to, the comparable GAAP measures, and may not be comparable to similarly
titled measures reported by other companies.
Management believes that these non-GAAP measures provide useful
information to investors by helping identify underlying growth trends in
our business and facilitating comparisons of our revenue performance
with prior and future periods and to our peers. We exclude the effect of
acquisitions and divestiture related items (including the impact of
agreements with Danaher that were entered into or terminated in
connection with the Separation) because the nature, size and number of
such transactions can vary dramatically from period to period and
between us and our peers. In addition, we exclude the impact of
agreements that were terminated, or entered into, in connection with the
Separation because management believes that excluding such impact may be
useful to investors in assessing our operational performance independent
of the impact of sales to Danaher resulting primarily from the
Separation. We exclude the effect of currency translation from sales
measures because currency translation is not under management's control
and is subject to volatility. We believe that such exclusion, when
presented with the corresponding GAAP measures, may assist in assessing
the business trends and making comparisons of long-term performance.
|
|
|
Adjusted Net Earnings
|
|
|
|
|
|
Three Months Ended
|
|
($ in millions)
|
|
December 31, 2016
|
|
December 31, 2015
|
|
Net Earnings (GAAP)
|
|
$
|
224.5
|
|
|
$
|
236.1
|
|
|
Pretax amortization of acquisition-related intangible assets in the
three months ended December 31, 2016 ($19 million pretax, $13
million after tax) and in the three months ended December 31, 2015
($22 million pretax, $14 million after tax)
|
|
|
18.5
|
|
|
|
22.3
|
|
|
Pretax additional interest expense in the three months ended
December 31, 2015 ($23 million pretax, $14 million after tax)
related to the borrowings incurred in connection with the Separation
|
|
|
—
|
|
|
|
(22.5
|
)
|
|
Pretax adjustments in the three months ended December 31, 2015 ($11
million pretax, $7 million after tax) to increase selling, general
and administrative expenses up to the Estimated SG&A Level
|
|
|
—
|
|
|
|
(10.6
|
)
|
|
Tax effect of all adjustments reflected above
|
|
|
(5.3
|
)
|
|
|
4.2
|
|
|
Adjusted Net Earnings (Non-GAAP)
|
|
$
|
237.7
|
|
|
$
|
229.5
|
|
|
|
|
|
|
Adjusted Diluted Net Earnings Per Share
|
|
|
|
|
|
Three Months Ended
December 31, 2016
|
|
Diluted Net Earnings Per Share (GAAP)
|
|
$
|
0.64
|
|
|
Pretax amortization of acquisition-related intangible assets ($19
million pretax, $13 million after tax)
|
|
|
0.05
|
|
|
Tax effect of the adjustment reflected above
|
|
|
(0.01
|
)
|
|
Adjusted Diluted Net Earnings Per Share (Non-GAAP)
|
|
$
|
0.68
|
|
|
|
|
|
|
Core Revenue Growth
|
|
|
|
|
|
Three Months Ended
December 31, 2016
vs.
Comparable
2015 Period
|
|
Core (Non-GAAP)
|
|
3.5
|
%
|
|
Acquisitions * (Non-GAAP)
|
|
0.9
|
%
|
|
Impact of currency translation (Non-GAAP)
|
|
(1.1
|
)%
|
|
Total Revenue Growth (GAAP)
|
|
3.3
|
%
|
|
|
|
* Includes the impact from both acquisitions and the Separation
|
|
|
|
|
|
Forecasted Adjusted Diluted Net Earnings Per Share
|
|
|
|
|
|
Three Months Ending
March 31, 2017
|
|
Year Ending
December 31, 2017
|
|
|
|
Low End
|
|
High End
|
|
Low End
|
|
High End
|
|
Forecasted Diluted Net Earnings Per Share
|
|
$
|
0.51
|
|
|
$
|
0.55
|
|
|
$
|
2.48
|
|
|
$
|
2.58
|
|
|
Pretax amortization of acquisition-related intangible assets in the
three months ending March 31, 2017 ($15 million pretax, $11 million
after-tax) and for the year ending December 31, 2017 ($60 million
pretax, $43 million after-tax)
|
|
|
0.04
|
|
|
|
0.04
|
|
|
|
0.17
|
|
|
|
0.17
|
|
|
Tax effect of the adjustment reflected above
|
|
|
(0.01
|
)
|
|
|
(0.01
|
)
|
|
|
(0.05
|
)
|
|
|
(0.05
|
)
|
|
Forecasted Adjusted Diluted Net Earnings Per Share
|
|
$
|
0.54
|
|
|
$
|
0.58
|
|
|
$
|
2.60
|
|
|
$
|
2.70
|
|
|
|
Fortive Corporation
Lisa Curran, 425-446-5000
Vice President, Investor Relations
6920 Seaway Boulevard
Everett, WA 98203