Delaware
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1-8002
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04-2209186
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(State or other jurisdiction of
incorporation or organization)
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(Commission File Number)
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(I.R.S. Employer Identification Number)
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81 Wyman Street
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Waltham, Massachusetts
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02451
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(Address of principal executive offices)
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(Zip Code)
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(781) 622-1000
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(Registrant’s telephone number
including area code)
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THERMO FISHER SCIENTIFIC INC.
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By:
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/s/ Peter E. Hornstra
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Peter E. Hornstra
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Vice President and Chief Accounting Officer
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FOR IMMEDIATE RELEASE
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Media Contact Information:
Karen Kirkwood
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Investor Contact Information:
Ken Apicerno
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Phone: 781-622-1306
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Phone: 781-622-1294
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E-mail: karen.kirkwood@thermofisher.com
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E-mail: ken.apicerno@thermofisher.com
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Website: www.thermofisher.com
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·
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Adjusted earnings per share (EPS) grew 17% to a record $1.37
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·
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Revenue increased 4% to a first quarter record of $3.19 billion
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·
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Adjusted operating margin expanded 40 basis points to 19.3%
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·
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Launched innovative new products at Pittcon that strengthened analytical technologies offering, including major upgrade of gold-standard Chromeleon chromatography data system
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·
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Deployed $90 million in the quarter to repurchase 1.3 million shares
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·
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After quarter-end, announced agreement to acquire Life Technologies, creating an unrivaled industry leader serving research, specialty diagnostics and applied markets
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Consolidated Statement of Income (unaudited) (a)(b)
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Three Months Ended
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||||||||||
March 30,
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% of
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March 31,
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% of
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||||||||
(In millions except per share amounts)
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2013
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Revenues
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2012
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Revenues
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Revenues
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$ | 3,191.5 | $ | 3,056.8 | |||||||
Costs and Operating Expenses:
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Cost of revenues (c)
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1,799.1 | 56.4% | 1,711.9 | 56.0% | |||||||
Selling, general and administrative expenses (d)
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693.6 | 21.7% | 695.6 | 22.8% | |||||||
Amortization of acquisition-related intangible assets
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192.0 | 6.0% | 183.9 | 6.0% | |||||||
Research and development expenses
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98.2 | 3.1% | 91.7 | 3.0% | |||||||
Restructuring and other costs, net (e)
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21.5 | 0.7% | 12.2 | 0.4% | |||||||
2,804.4 | 87.9% | 2,695.3 | 88.2% | ||||||||
Operating Income
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387.1 | 12.1% | 361.5 | 11.8% | |||||||
Interest Income
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7.2 | 6.4 | |||||||||
Interest Expense
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(64.4 | ) | (57.7 | ) | |||||||
Other Income, Net (f)
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13.0 | 0.9 | |||||||||
Income Before Income Taxes
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342.9 | 311.1 | |||||||||
Provision for Income Taxes (g)
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(2.1 | ) | (30.3 | ) | |||||||
Income from Continuing Operations
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340.8 | 280.8 | |||||||||
Loss from Discontinued Operations, Net of Tax
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(0.4 | ) | (3.8 | ) | |||||||
(Loss) Gain on Disposal of Discontinued Operations, Net of Tax
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(4.2 | ) | 0.3 | ||||||||
Net Income
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$ | 336.2 | 10.5% | $ | 277.3 | 9.1% | |||||
Earnings per Share from Continuing Operations:
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Basic
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$ | .95 | $ | .76 | |||||||
Diluted
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$ | .94 | $ | .76 | |||||||
Earnings per Share:
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Basic
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$ | .94 | $ | .76 | |||||||
Diluted
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$ | .93 | $ | .75 | |||||||
Weighted Average Shares:
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|||||||||||
Basic
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358.1 | 367.3 | |||||||||
Diluted
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361.7 | 370.1 | |||||||||
Reconciliation of Adjusted Operating Income and Adjusted Operating Margin
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GAAP Operating Income (a)
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$ | 387.1 | 12.1% | $ | 361.5 | 11.8% | |||||
Cost of Revenues Charges (c)
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13.2 | 0.4% | 26.6 | 0.9% | |||||||
Selling, General and Administrative Costs (Income), Net (d)
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1.3 | 0.1% | (7.7 | ) | -0.2% | ||||||
Restructuring and Other Costs, Net (e)
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21.5 | 0.7% | 12.2 | 0.4% | |||||||
Amortization of Acquisition-related Intangible Assets
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192.0 | 6.0% | 183.9 | 6.0% | |||||||
Adjusted Operating Income (b)
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$ | 615.1 | 19.3% | $ | 576.5 | 18.9% | |||||
Reconciliation of Adjusted Net Income
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GAAP Net Income (a)
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$ | 336.2 | 10.5% | $ | 277.3 | 9.1% | |||||
Cost of Revenues Charges (c)
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13.2 | 0.4% | 26.6 | 0.9% | |||||||
Selling, General and Administrative Costs (Income), Net (d)
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1.3 | 0.1% | (7.7 | ) | -0.2% | ||||||
Restructuring and Other Costs, Net (e)
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21.5 | 0.7% | 12.2 | 0.4% | |||||||
Amortization of Acquisition-related Intangible Assets
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192.0 | 6.0% | 183.9 | 6.0% | |||||||
Amortization of Acquisition-related Intangible Assets – Equity Investments
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0.7 | 0.0% | 0.7 | 0.0% | |||||||
Other (Income) Expense, Net (f)
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(10.5 | ) | -0.3% | 0.5 | 0.0% | ||||||
Provision for Income Taxes (g)
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(63.3 | ) | -2.0% | (62.6 | ) | -2.1% | |||||
Discontinued Operations, Net of Tax
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4.6 | 0.1% | 3.5 | 0.1% | |||||||
Adjusted Net Income (b)
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$ | 495.7 | 15.5% | $ | 434.4 | 14.2% | |||||
Reconciliation of Adjusted Earnings per Share
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GAAP EPS (a)
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$ | 0.93 | $ | 0.75 | |||||||
Cost of Revenues Charges, Net of Tax (c)
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0.03 | 0.05 | |||||||||
Selling, General and Administrative Costs (Income), Net of Tax (d)
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— | (0.01 | ) | ||||||||
Restructuring and Other Costs, Net of Tax (e)
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0.04 | 0.02 | |||||||||
Amortization of Acquisition-related Intangible Assets, Net of Tax
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0.38 | 0.34 | |||||||||
Amortization of Acquisition-related Intangible Assets, Net of Tax – Equity Investments
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— | — | |||||||||
Other (Income) Expense, Net of Tax (f)
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(0.02 | ) | — | ||||||||
Provision for Income Taxes (g)
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— | 0.01 | |||||||||
Discontinued Operations, Net of Tax
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0.01 | 0.01 | |||||||||
Adjusted EPS (b)
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$ | 1.37 | $ | 1.17 | |||||||
Reconciliation of Free Cash Flow
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GAAP Net Cash Provided by Operating Activities (a)
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$ | 298.3 | $ | 392.0 | |||||||
Net Cash Used in Discontinued Operations
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0.8 | 5.9 | |||||||||
Purchases of Property, Plant and Equipment
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(66.0 | ) | (69.2 | ) | |||||||
Proceeds from Sale of Property, Plant and Equipment
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3.0 | 4.0 | |||||||||
Free Cash Flow
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$ | 236.1 | $ | 332.7 |
Segment Data
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Three Months Ended
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March 30,
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% of
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March 31,
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% of
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(In millions)
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2013
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Revenues
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2012
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Revenues
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Revenues
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Analytical Technologies
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$ | 977.8 | 30.6% | $ | 980.0 | 32.1% | |||||
Specialty Diagnostics
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805.6 | 25.2% | 731.9 | 23.9% | |||||||
Laboratory Products and Services
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1,544.3 | 48.4% | 1,475.8 | 48.3% | |||||||
Eliminations
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(136.2 | ) | -4.2% | (130.9 | ) | -4.3% | |||||
Consolidated Revenues
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$ | 3,191.5 | 100.0% | $ | 3,056.8 | 100.0% | |||||
Operating Income and Operating Margin
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Analytical Technologies
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$ | 176.1 | 18.0% | $ | 178.8 | 18.2% | |||||
Specialty Diagnostics
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221.7 | 27.5% | 186.9 | 25.5% | |||||||
Laboratory Products and Services
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217.3 | 14.1% | 210.8 | 14.3% | |||||||
Subtotal Reportable Segments
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615.1 | 19.3% | 576.5 | 18.9% | |||||||
Cost of Revenues Charges (c)
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(13.2 | ) | -0.4% | (26.6 | ) | -0.9% | |||||
Selling, General and Administrative (Costs) Income, Net (d)
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(1.3 | ) | -0.1% | 7.7 | 0.2% | ||||||
Restructuring and Other Costs, Net (e)
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(21.5 | ) | -0.7% | (12.2 | ) | -0.4% | |||||
Amortization of Acquisition-related Intangible Assets
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(192.0 | ) | -6.0% | (183.9 | ) | -6.0% | |||||
GAAP Operating Income (a)
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$ | 387.1 | 12.1% | $ | 361.5 | 11.8% |
Condensed Consolidated Balance Sheet (unaudited)
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March 30, | December 31, | ||||||
(In millions)
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2013 | 2012 | |||||
Assets
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Current Assets:
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Cash and cash equivalents
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$ | 1,004.1 | $ | 851.0 | |||
Short-term investments
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4.2 | 4.3 | |||||
Accounts receivable, net
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1,904.5 | 1,804.9 | |||||
Inventories
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1,474.6 | 1,443.3 | |||||
Other current assets
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748.7 | 731.3 | |||||
Total current assets
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5,136.1 | 4,834.8 | |||||
Property, Plant and Equipment, Net
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1,685.8 | 1,726.4 | |||||
Acquisition-related Intangible Assets
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7,560.9 | 7,804.5 | |||||
Other Assets
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583.8 | 604.4 | |||||
Goodwill
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12,444.1 | 12,474.5 | |||||
Total Assets
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$ | 27,410.7 | $ | 27,444.6 | |||
Liabilities and Shareholders' Equity
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Current Liabilities:
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Short-term obligations and current maturities of long-term obligations
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$ | 394.0 | $ | 93.1 | |||
Other current liabilities
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1,908.8 | 2,000.2 | |||||
Total current liabilities
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2,302.8 | 2,093.3 | |||||
Other Long-term Liabilities
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2,784.0 | 2,855.4 | |||||
Long-term Obligations
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6,724.4 | 7,031.2 | |||||
Total Shareholders' Equity
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15,599.5 | 15,464.7 | |||||
Total Liabilities and Shareholders' Equity
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$ | 27,410.7 | $ | 27,444.6 |
Condensed Consolidated Statement of Cash Flows (unaudited)
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Three Months Ended
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March 30,
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March 31,
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(In millions)
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2013
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2012
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Operating Activities
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Net income | $ | 336.2 | $ | 277.3 | |||
Loss from discontinued operations
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0.4 | 3.8 | |||||
Loss (gain) on disposal of discontinued operations
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4.2 | (0.3 | ) | ||||
Income from continuing operations
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340.8 | 280.8 | |||||
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
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Depreciation and amortization
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251.0 | 242.5 | |||||
Change in deferred income taxes
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(16.0 | ) | (43.2 | ) | |||
Other non-cash expenses, net
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14.9 | 47.2 | |||||
Changes in assets and liabilities, excluding the effects of acquisitions and dispositions
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(291.6 | ) | (129.4 | ) | |||
Net cash provided by continuing operations
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299.1 | 397.9 | |||||
Net cash used in discontinued operations
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(0.8 | ) | (5.9 | ) | |||
Net cash provided by operating activities
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298.3 | 392.0 | |||||
Investing Activities
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Acquisitions, net of cash acquired
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(3.8 | ) | (0.5 | ) | |||
Purchases of property, plant and equipment
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(66.0 | ) | (69.2 | ) | |||
Proceeds from sale of property, plant and equipment
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3.0 | 4.0 | |||||
Other investing activities, net
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(0.3 | ) | (0.9 | ) | |||
Net cash used in continuing operations
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(67.1 | ) | (66.6 | ) | |||
Net cash provided by discontinued operations
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— | 0.4 | |||||
Net cash used in investing activities
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(67.1 | ) | (66.2 | ) | |||
Financing Activities
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Decrease in commercial paper, net
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— | (349.6 | ) | ||||
Redemption and repayment of long-term obligations
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(0.5 | ) | (0.4 | ) | |||
Dividends paid
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(54.0 | ) | — | ||||
Purchases of company common stock
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(89.8 | ) | (300.0 | ) | |||
Net proceeds from issuance of company common stock
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101.8 | 55.1 | |||||
Tax benefits from stock-based compensation awards
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16.2 | 7.7 | |||||
(Decrease) increase in short-term notes payable
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(1.5 | ) | 2.2 | ||||
Net cash used in financing activities
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(27.8 | ) | (585.0 | ) | |||
Exchange Rate Effect on Cash
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(50.3 | ) | 31.2 | ||||
Increase (Decrease) in Cash and Cash Equivalents
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153.1 | (228.0 | ) | ||||
Cash and Cash Equivalents at Beginning of Period
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851.0 | 1,016.3 | |||||
Cash and Cash Equivalents at End of Period
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$ | 1,004.1 | $ | 788.3 | |||
Free Cash Flow (a)
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$ | 236.1 | $ | 332.7 |