Delaware
|
1-8002
|
04-2209186
|
||
(State or other jurisdiction of
incorporation or organization)
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(Commission File Number)
|
(I.R.S. Employer Identification Number)
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81 Wyman Street
|
||
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.
|
|||
By:
|
/s/ Peter E. Hornstra
|
||
Peter E. Hornstra
|
|||
Vice President and Chief Accounting Officer
|
FOR IMMEDIATE RELEASE
|
||
Media Contact Information:
Karen Kirkwood
|
Investor Contact Information:
Ken Apicerno
|
|
Phone: 781-622-1306
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Phone: 781-622-1294
|
|
E-mail: karen.kirkwood@thermofisher.com
|
E-mail: ken.apicerno@thermofisher.com
|
|
Website: www.thermofisher.com
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·
|
Grew full year adjusted earnings per share (EPS) by 10% to a record $5.42, and fourth quarter adjusted EPS by 5% to a record $1.43.
|
·
|
Increased fourth quarter revenue by 6% to a record $3.47 billion.
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·
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Expanded adjusted operating margin in the fourth quarter by 40 basis points to 20.0%.
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·
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Generated free cash flow of $1.75 billion for the full year.
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·
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Launched innovative new Thermo Scientific products during the year to strengthen leading mass spectrometry, chromatography, specialty diagnostics and biosciences offerings, highlighted by the breakthrough Orbitrap Fusion Tribrid and new triple-quad platforms.
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·
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Achieved 20% growth in China for the year by leveraging investments to expand R&D, manufacturing and commercial capabilities, and delivered strong results in other high-growth markets, including Korea and Brazil.
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·
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Returned more than $300 million of capital to shareholders through stock buybacks and dividends.
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·
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Acquiring Life Technologies to add complementary genomics, next-generation sequencing and forensic science capabilities for customers in life sciences and applied markets, and to expand presence in APAC and emerging markets.
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Consolidated Statement of Income (a)(b)
|
Three Months Ended
|
||||||||||
December 31, | % of |
December 31,
|
% of
|
||||||||
(In millions except per share amounts)
|
2013
|
Revenues
|
2012
|
Revenues
|
|||||||
Revenues
|
$ | 3,466.9 | $ | 3,259.3 | |||||||
Costs and Operating Expenses:
|
|||||||||||
Cost of revenues (c)
|
1,931.0 | 55.7% | 1,815.6 | 55.7% | |||||||
Selling, general and administrative expenses (d)
|
764.0 | 22.0% | 720.1 | 22.1% | |||||||
Amortization of acquisition-related intangible assets
|
188.9 | 5.5% | 194.1 | 6.0% | |||||||
Research and development expenses
|
104.7 | 3.0% | 98.5 | 3.0% | |||||||
Restructuring and other costs, net (e)
|
23.3 | 0.7% | 30.4 | 0.9% | |||||||
3,011.9 | 86.9% | 2,858.7 | 87.7% | ||||||||
Operating Income
|
455.0 | 13.1% | 400.6 | 12.3% | |||||||
Interest Income
|
6.6 | 6.2 | |||||||||
Interest Expense
|
(69.0 | ) | (66.2 | ) | |||||||
Other (Expense) Income, Net (f)
|
(15.0 | ) | 2.9 | ||||||||
Income Before Income Taxes
|
377.6 | 343.5 | |||||||||
(Provision for) Benefit from Income Taxes (g)
|
(34.6 | ) | 42.3 | ||||||||
Income from Continuing Operations
|
343.0 | 385.8 | |||||||||
Loss from Discontinued Operations, Net of Tax
|
— | (3.8 | ) | ||||||||
Loss on Disposal of Discontinued Operations, Net of Tax
|
(0.9 | ) | (5.6 | ) | |||||||
Net Income
|
$ | 342.1 | 9.9% | $ | 376.4 | 11.5% | |||||
Earnings per Share from Continuing Operations:
|
|||||||||||
Basic
|
$ | .95 | $ | 1.08 | |||||||
Diluted
|
$ | .92 | $ | 1.07 | |||||||
Earnings per Share:
|
|||||||||||
Basic
|
$ | .95 | $ | 1.05 | |||||||
Diluted
|
$ | .92 | $ | 1.04 | |||||||
Weighted Average Shares:
|
|||||||||||
Basic
|
361.8 | 358.4 | |||||||||
Diluted
|
370.9 | 361.7 | |||||||||
Reconciliation of Adjusted Operating Income and Adjusted Operating Margin
|
|||||||||||
GAAP Operating Income (a)
|
$ | 455.0 | 13.1% | $ | 400.6 | 12.3% | |||||
Cost of Revenues Charges (c)
|
1.4 | 0.0% | 13.1 | 0.4% | |||||||
Selling, General and Administrative Costs (Income), Net (d)
|
25.6 | 0.7% | (0.6 | ) | 0.0% | ||||||
Restructuring and Other Costs, Net (e)
|
23.3 | 0.7% | 30.4 | 0.9% | |||||||
Amortization of Acquisition-related Intangible Assets
|
188.9 | 5.5% | 194.1 | 6.0% | |||||||
Adjusted Operating Income (b)
|
$ | 694.2 | 20.0% | $ | 637.6 | 19.6% | |||||
Reconciliation of Adjusted Net Income
|
|||||||||||
GAAP Net Income (a)
|
$ | 342.1 | 9.9% | $ | 376.4 | 11.5% | |||||
Cost of Revenues Charges (c)
|
1.4 | 0.0% | 13.1 | 0.4% | |||||||
Selling, General and Administrative Costs (Income), Net (d)
|
25.6 | 0.7% | (0.6 | ) | 0.0% | ||||||
Restructuring and Other Costs, Net (e)
|
23.3 | 0.7% | 30.4 | 0.9% | |||||||
Amortization of Acquisition-related Intangible Assets
|
188.9 | 5.5% | 194.1 | 6.0% | |||||||
Amortization of Acquisition-related Intangible Assets – Equity Investments
|
0.6 | 0.0% | 0.4 | 0.0% | |||||||
Other Expense, Net (f)
|
13.4 | 0.4% | — | 0.0% | |||||||
Provision for Income Taxes (g)
|
(65.9 | ) | -1.9% | (130.4 | ) | -4.0% | |||||
Discontinued Operations, Net of Tax
|
0.9 | 0.0% | 9.4 | 0.3% | |||||||
Adjusted Net Income (b)
|
$ | 530.3 | 15.3% | $ | 492.8 | 15.1% | |||||
Reconciliation of Adjusted Earnings per Share
|
|||||||||||
GAAP EPS (a)
|
$ | 0.92 | $ | 1.04 | |||||||
Cost of Revenues Charges, Net of Tax (c)
|
— | 0.02 | |||||||||
Selling, General and Administrative Costs, Net of Tax (d)
|
0.06 | — | |||||||||
Restructuring and Other Costs, Net of Tax (e)
|
0.05 | 0.05 | |||||||||
Amortization of Acquisition-related Intangible Assets, Net of Tax
|
0.35 | 0.37 | |||||||||
Amortization of Acquisition-related Intangible Assets, Net of Tax – Equity Investments
|
— | — | |||||||||
Other Expense, Net of Tax (f)
|
0.02 | — | |||||||||
Provision for Income Taxes (g)
|
0.03 | (0.15 | ) | ||||||||
Discontinued Operations, Net of Tax
|
— | 0.03 | |||||||||
Adjusted EPS (b)
|
$ | 1.43 | $ | 1.36 | |||||||
Reconciliation of Free Cash Flow
|
|||||||||||
GAAP Net Cash Provided by Operating Activities (a)
|
$ | 728.5 | $ | 660.1 | |||||||
Net Cash Used in Discontinued Operations
|
1.6 | 7.2 | |||||||||
Purchases of Property, Plant and Equipment
|
(94.5 | ) | (104.4 | ) | |||||||
Proceeds from Sale of Property, Plant and Equipment
|
4.8 | 1.2 | |||||||||
Free Cash Flow (h)
|
$ | 640.4 | $ | 564.1 |
Segment Data
|
Three Months Ended
|
||||||||||
December 31,
|
% of
|
December 31,
|
% of
|
||||||||
(In millions)
|
2013
|
Revenues
|
2012
|
Revenues
|
|||||||
Revenues
|
|||||||||||
Analytical Technologies
|
$ | 1,144.2 | 33.0% | $ | 1,079.0 | 33.1% | |||||
Specialty Diagnostics
|
833.3 | 24.0% | 791.8 | 24.3% | |||||||
Laboratory Products and Services
|
1,640.9 | 47.3% | 1,516.6 | 46.5% | |||||||
Eliminations
|
(151.5 | ) | -4.3% | (128.1 | ) | -3.9% | |||||
Consolidated Revenues
|
$ | 3,466.9 | 100.0% | $ | 3,259.3 | 100.0% | |||||
Operating Income and Operating Margin
|
|||||||||||
Analytical Technologies
|
$ | 233.4 | 20.4% | $ | 215.2 | 19.9% | |||||
Specialty Diagnostics
|
224.4 | 26.9% | 205.0 | 25.9% | |||||||
Laboratory Products and Services
|
236.4 | 14.4% | 217.4 | 14.3% | |||||||
Subtotal Reportable Segments
|
694.2 | 20.0% | 637.6 | 19.6% | |||||||
Cost of Revenues Charges (c)
|
(1.4 | ) | 0.0% | (13.1 | ) | -0.4% | |||||
Selling, General and Administrative (Costs) Income, Net (d)
|
(25.6 | ) | -0.7% | 0.6 | 0.0% | ||||||
Restructuring and Other Costs, Net (e)
|
(23.3 | ) | -0.7% | (30.4 | ) | -0.9% | |||||
Amortization of Acquisition-related Intangible Assets
|
(188.9 | ) | -5.5% | (194.1 | ) | -6.0% | |||||
GAAP Operating Income (a)
|
$ | 455.0 | 13.1% | $ | 400.6 | 12.3% |
Consolidated Statement of Income (a)(b)
|
Year Ended
|
||||||||||
December 31,
|
% of
|
December 31,
|
% of
|
||||||||
(In millions except per share amounts)
|
2013
|
Revenues
|
2012
|
Revenues
|
|||||||
Revenues
|
$ | 13,090.3 | $ | 12,509.9 | |||||||
Costs and Operating Expenses:
|
|||||||||||
Cost of revenues (c)
|
7,339.2 | 56.1% | 6,993.0 | 55.9% | |||||||
Selling, general and administrative expenses (d)
|
2,905.2 | 22.2% | 2,828.7 | 22.6% | |||||||
Amortization of acquisition-related intangible assets
|
763.1 | 5.8% | 747.6 | 6.0% | |||||||
Research and development expenses
|
395.5 | 3.0% | 376.4 | 3.0% | |||||||
Restructuring and other costs, net (e)
|
77.7 | 0.6% | 82.1 | 0.7% | |||||||
11,480.7 | 87.7% | 11,027.8 | 88.2% | ||||||||
Operating Income
|
1,609.6 | 12.3% | 1,482.1 | 11.8% | |||||||
Interest Income
|
28.0 | 25.2 | |||||||||
Interest Expense
|
(262.1 | ) | (241.6 | ) | |||||||
Other (Expense) Income, Net (f)
|
(56.0 | ) | 3.7 | ||||||||
Income from Continuing Operations Before Income Taxes
|
1,319.5 | 1,269.4 | |||||||||
Provision for Income Taxes (g)
|
(40.4 | ) | (11.0 | ) | |||||||
Income from Continuing Operations
|
1,279.1 | 1,258.4 | |||||||||
Loss from Discontinued Operations, Net of Tax
|
(0.7 | ) | (19.2 | ) | |||||||
Loss on Disposal of Discontinued Operations, Net of Tax
|
(5.1 | ) | (61.3 | ) | |||||||
Net Income
|
$ | 1,273.3 | 9.7% | $ | 1,177.9 | 9.4% | |||||
Earnings per Share from Continuing Operations:
|
|||||||||||
Basic
|
$ | 3.55 | $ | 3.46 | |||||||
Diluted
|
$ | 3.50 | $ | 3.43 | |||||||
Earnings per Share:
|
|||||||||||
Basic
|
$ | 3.53 | $ | 3.24 | |||||||
Diluted
|
$ | 3.48 | $ | 3.21 | |||||||
Weighted Average Shares:
|
|||||||||||
Basic
|
360.3 | 363.8 | |||||||||
Diluted
|
365.8 | 366.6 | |||||||||
Reconciliation of Adjusted Operating Income and Adjusted Operating Margin
|
|||||||||||
GAAP Operating Income (a)
|
$ | 1,609.6 | 12.3% | $ | 1,482.1 | 11.8% | |||||
Cost of Revenues Charges (c)
|
28.6 | 0.2% | 55.6 | 0.4% | |||||||
Selling, General and Administrative Costs, Net (d)
|
73.5 | 0.6% | 12.5 | 0.1% | |||||||
Restructuring and Other Costs, Net (e)
|
77.7 | 0.6% | 82.1 | 0.7% | |||||||
Amortization of Acquisition-related Intangible Assets
|
763.1 | 5.8% | 747.6 | 6.0% | |||||||
Adjusted Operating Income (b)
|
$ | 2,552.5 | 19.5% | $ | 2,379.9 | 19.0% | |||||
Reconciliation of Adjusted Net Income
|
|||||||||||
GAAP Net Income (a)
|
$ | 1,273.3 | 9.7% | $ | 1,177.9 | 9.4% | |||||
Cost of Revenues Charges (c)
|
28.6 | 0.2% | 55.6 | 0.4% | |||||||
Selling, General and Administrative Costs, Net (d)
|
73.5 | 0.6% | 12.5 | 0.1% | |||||||
Restructuring and Other Costs, Net (e)
|
77.7 | 0.6% | 82.1 | 0.7% | |||||||
Amortization of Acquisition-related Intangible Assets
|
763.1 | 5.8% | 747.6 | 6.0% | |||||||
Restructuring and Other Costs, Net – Equity Investments
|
— | 0.0% | 2.1 | 0.0% | |||||||
Amortization of Acquisition-related Intangible Assets – Equity Investments
|
2.4 | 0.0% | 2.7 | 0.0% | |||||||
Other Expense, Net (f)
|
58.0 | 0.4% | 0.5 | 0.0% | |||||||
Provision for Income Taxes (g)
|
(300.7 | ) | -2.3% | (351.7 | ) | -2.8% | |||||
Discontinued Operations, Net of Tax
|
5.8 | 0.1% | 80.5 | 0.7% | |||||||
Adjusted Net Income (b)
|
$ | 1,981.7 | 15.1% | $ | 1,809.8 | 14.5% | |||||
Reconciliation of Adjusted Earnings per Share
|
|||||||||||
GAAP EPS (a)
|
$ | 3.48 | $ | 3.21 | |||||||
Cost of Revenues Charges, Net of Tax (c)
|
0.05 | 0.11 | |||||||||
Selling, General and Administrative Costs, Net of Tax (d)
|
0.16 | 0.03 | |||||||||
Restructuring and Other Costs, Net of Tax (e)
|
0.16 | 0.15 | |||||||||
Amortization of Acquisition-related Intangible Assets, Net of Tax
|
1.45 | 1.36 | |||||||||
Restructuring and Other Costs, Net of Tax – Equity Investments
|
— | — | |||||||||
Amortization of Acquisition-related Intangible Assets, Net of Tax – Equity Investments
|
— | — | |||||||||
Other Expense, Net of Tax (f)
|
0.09 | — | |||||||||
Provision for Income Taxes (g)
|
0.01 | (0.14 | ) | ||||||||
Discontinued Operations, Net of Tax
|
0.02 | 0.22 | |||||||||
Adjusted EPS (b)
|
$ | 5.42 | $ | 4.94 | |||||||
Reconciliation of Free Cash Flow
|
|||||||||||
GAAP Net Cash Provided by Operating Activities (a)
|
$ | 2,010.7 | $ | 2,039.5 | |||||||
Net Cash Used in Discontinued Operations
|
4.9 | 28.4 | |||||||||
Purchases of Property, Plant and Equipment
|
(282.4 | ) | (315.1 | ) | |||||||
Proceeds from Sale of Property, Plant and Equipment
|
20.7 | 12.8 | |||||||||
Free Cash Flow (h)
|
$ | 1,753.9 | $ | 1,765.6 |
Segment Data
|
Year Ended
|
||||||||||
December 31,
|
% of
|
December 31,
|
% of
|
||||||||
(In millions)
|
2013
|
Revenues
|
2012
|
Revenues
|
|||||||
Revenues
|
|||||||||||
Analytical Technologies
|
$ | 4,125.1 | 31.5% | $ | 4,017.9 | 32.1% | |||||
Specialty Diagnostics
|
3,191.7 | 24.4% | 2,962.3 | 23.7% | |||||||
Laboratory Products and Services
|
6,350.5 | 48.5% | 6,053.7 | 48.4% | |||||||
Eliminations
|
(577.0 | ) | -4.4% | (524.0 | ) | -4.2% | |||||
Consolidated Revenues
|
$ | 13,090.3 | 100.0% | $ | 12,509.9 | 100.0% | |||||
Operating Income and Operating Margin
|
|||||||||||
Analytical Technologies
|
$ | 767.8 | 18.6% | $ | 749.1 | 18.6% | |||||
Specialty Diagnostics
|
866.7 | 27.2% | 761.2 | 25.7% | |||||||
Laboratory Products and Services
|
918.0 | 14.5% | 869.6 | 14.4% | |||||||
Subtotal Reportable Segments
|
2,552.5 | 19.5% | 2,379.9 | 19.0% | |||||||
Cost of Revenues Charges (c)
|
(28.6 | ) | -0.2% | (55.6 | ) | -0.4% | |||||
Selling, General and Administrative Costs, Net (d)
|
(73.5 | ) | -0.6% | (12.5 | ) | -0.1% | |||||
Restructuring and Other Costs, Net (e)
|
(77.7 | ) | -0.6% | (82.1 | ) | -0.7% | |||||
Amortization of Acquisition-related Intangible Assets
|
(763.1 | ) | -5.8% | (747.6 | ) | -6.0% | |||||
GAAP Operating Income (a)
|
$ | 1,609.6 | 12.3% | $ | 1,482.1 | 11.8% |
Condensed Consolidated Balance Sheet | |||||||
December 31, |
December 31,
|
||||||
(In millions) |
2013
|
2012
|
|||||
Assets
|
|||||||
Current Assets:
|
|||||||
Cash and cash equivalents
|
$ | 5,826.0 | $ | 805.6 | |||
Short-term investments
|
4.5 | 4.3 | |||||
Accounts receivable, net
|
1,942.3 | 1,804.9 | |||||
Inventories
|
1,494.5 | 1,443.3 | |||||
Other current assets
|
617.1 | 776.7 | |||||
Total current assets
|
9,884.4 | 4,834.8 | |||||
Property, Plant and Equipment, Net
|
1,767.4 | 1,726.4 | |||||
Acquisition-related Intangible Assets
|
7,071.3 | 7,804.5 | |||||
Other Assets
|
649.8 | 604.4 | |||||
Goodwill
|
12,503.3 | 12,474.5 | |||||
Total Assets
|
$ | 31,876.2 | $ | 27,444.6 | |||
Liabilities and Shareholders' Equity
|
|||||||
Current Liabilities:
|
|||||||
Short-term obligations and current maturities of long-term obligations (a)
|
$ | 4,178.6 | $ | 93.1 | |||
Other current liabilities
|
2,129.6 | 2,000.2 | |||||
Total current liabilities
|
6,308.2 | 2,093.3 | |||||
Other Long-term Liabilities
|
2,403.2 | 2,855.4 | |||||
Long-term Obligations
|
6,308.7 | 7,031.2 | |||||
Total Shareholders' Equity
|
16,856.1 | 15,464.7 | |||||
Total Liabilities and Shareholders' Equity
|
$ | 31,876.2 | $ | 27,444.6 |
Condensed Consolidated Statement of Cash Flows |
Year Ended
|
||||||
December 31, | December 31, | ||||||
(In millions) | 2013 | 2012 | |||||
Operating Activities
|
|||||||
|
$ | 1,273.3 | $ | 1,177.9 | |||
Loss from discontinued operations
|
0.7 | 19.2 | |||||
Loss on disposal of discontinued operations
|
5.1 | 61.3 | |||||
Income from continuing operations
|
1,279.1 | 1,258.4 | |||||
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
|
|||||||
Depreciation and amortization
|
999.9 | 983.7 | |||||
Change in deferred income taxes
|
(472.6 | ) | (301.6 | ) | |||
Other non-cash expenses, net
|
88.7 | 161.7 | |||||
Changes in assets and liabilities, excluding the effects of acquisitions and dispositions
|
120.5 | (34.3 | ) | ||||
Net cash provided by continuing operations
|
2,015.6 | 2,067.9 | |||||
Net cash used in discontinued operations
|
(4.9 | ) | (28.4 | ) | |||
Net cash provided by operating activities
|
2,010.7 | 2,039.5 | |||||
Investing Activities
|
|||||||
Acquisitions, net of cash acquired
|
(11.4 | ) | (1,083.4 | ) | |||
Purchases of property, plant and equipment
|
(282.4 | ) | (315.1 | ) | |||
Proceeds from sale of property, plant and equipment
|
20.7 | 12.8 | |||||
Decrease (increase) in restricted cash
|
4.0 | (45.1 | ) | ||||
Other investing activities, net
|
5.8 | 1.1 | |||||
Net cash used in continuing operations
|
(263.3 | ) | (1,429.7 | ) | |||
Net cash provided by discontinued operations
|
— | 58.8 | |||||
Net cash used in investing activities
|
(263.3 | ) | (1,370.9 | ) | |||
Financing Activities
|
|||||||
Net proceeds from issuance of debt
|
3,167.8 | 1,282.1 | |||||
Increase (decrease) in commercial paper, net
|
199.9 | (849.3 | ) | ||||
Redemption and repayment of long-term obligations
|
(1.0 | ) | (354.5 | ) | |||
(Decrease) increase in short-term notes payable
|
(12.0 | ) | 24.0 | ||||
Purchases of company common stock
|
(89.8 | ) | (1,150.0 | ) | |||
Dividends paid
|
(216.2 | ) | (142.2 | ) | |||
Net proceeds from issuance of company common stock
|
230.4 | 254.1 | |||||
Tax benefits from stock-based compensation awards
|
48.8 | 22.7 | |||||
Other financing activities, net
|
(17.9 | ) | (4.6 | ) | |||
Net cash provided by (used in) financing activities
|
3,310.0 | (917.7 | ) | ||||
Exchange Rate Effect on Cash
|
(37.0 | ) | 38.4 | ||||
Increase (Decrease) in Cash and Cash Equivalents
|
5,020.4 | (210.7 | ) | ||||
Cash and Cash Equivalents at Beginning of Period
|
805.6 | 1,016.3 | |||||
Cash and Cash Equivalents at End of Period
|
$ | 5,826.0 | $ | 805.6 | |||
Free Cash Flow (a)(b)
|
$ | 1,753.9 | $ | 1,765.6 |