DANAHER CORPORATION
2016 Overview
Statements in this presentation that are not strictly historical, including any statements regarding events or developments that we believe or anticipate will or may
occur in the future 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, the impact of our restructuring activities on our ability to grow, contractions or growth rates and cyclicality of markets
we serve, competition, our ability to develop and successfully market new products and technologies and expand into new markets, the potential for improper
conduct by our employees, agents or business partners, our ability to successfully identify, consummate and integrate appropriate acquisitions and successfully
complete divestitures and other dispositions, our ability to integrate the recent acquisitions of Pall Corporation and Cepheid and achieve the anticipated benefits
of those transactions, contingent liabilities relating to acquisitions and divestitures (including tax-related and other contingent liabilities relating to the
distributions of each of Fortive Corporation and our communications business), our compliance with applicable laws and regulations (including regulations
relating to medical devices and the healthcare industry) and changes in applicable laws and regulations, our ability to effectively address cost reductions and
other changes in the healthcare industry, 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, 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 (including the impact of the UK referendum to leave the EU), disruptions relating to man-made and natural disasters,
security breaches or other disruptions of our information technology systems and pension plan costs. 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 our 2016 Annual Report on Form 10-K. These
forward-looking statements speak only as of the date of this presentation and the Company 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.
With respect to any non-GAAP financial measures included in the following presentation, the accompanying information required by SEC Regulation G can be
found herein. All references in this presentation to earnings, revenues and other company-specific financial metrics relate only to the continuing operations of
Danaher’s business, unless otherwise noted. All references in this presentation to “growth” or other period-to-period changes refer to year-over-year comparisons
unless otherwise indicated. We may also describe certain products and devices which have applications submitted and pending for certain regulatory approvals.
Forward Looking Statements
Danaher Today
Diagnostics DentalLife
Sciences
Environmental &
Applied Solutions
Water Quality
Product ID
~$5.4B revenue ~$5.0B revenue ~$2.8B revenue ~$3.7B revenue
Building a multi-industry, science & technology company
All financial metrics shown reflect FY 2016 revenues.
Team executed well in challenging macro environment
Consistent core revenue growth across all 4 segments
FCF of ~$2.5B exceeded Net Income for 25th consecutive year
Expanding margins while reinvesting
Core OMX up 115bps
GM up >100bps, G&A* down, R&D/S&M* up
Announced and closed ~$5B in acquisitions, including
Cepheid and Phenomenex
9 deals across all 5 platforms
Completed separation of Fortive in July
2016 Highlights
Well positioned for outperformance in 2016 and beyond
* As a % of total revenues, excluding Cepheid & Pall.
0%
500%
1000%
1500%
2000%
Dec-96 Dec-98 Dec-00 Dec-02 Dec-04 Dec-06 Dec-08 Dec-10 Dec-12 Dec-14 Dec-16
20-Year Total Shareholder ReturnDHR vs. S&P 500
Outperforming over the long term
DHR S&P 500 Difference
3 Year 35.6% 29.1% 6.5%
10 Year 191.1% 95.7% 95.4%
20 Year 1,714.0% 339.3% 1,374.7%
S&P 500
DHR
Adjusted EPS growth of >20% in 2016
$2.35
$2.66
$2.98
$3.61
$0.00
$1.00
$2.00
$3.00
$4.00
$0.0
$4.0
$8.0
$12.0
$16.0
2013 2014 2015 2016
Historical PerformanceR
ev
en
ue (
$B
) Ad
jus
ted
EP
S
$12.4B$12.9B
$14.4B
$16.9B
Free cash flow exceeded net income for 25th year in a row
*Free cash flow is defined as operating cash flow less capital expenditures.
$1.9B$2.2B
$2.3B$2.5B
2013 2014 2015 2016
Free Cash Flow
Net Income Continuing Ops Above Net Income
Free Cash Flow Conversion
Outstanding Portfolio
Strong growth, free cash flow and earnings profile
ROW
7%NA
40%
EU
24%
HGM
29%
Diagnostics
30%
Dental
16%
EAS
22%
By Business
By Geography
Life
Sciences
32%
All financial metrics based on FY 2016.
~55%GROSS
MARGIN
Mid-teens
OPERATING
MARGIN
>100%FREE CASH
FLOW TO NET
INCOME
~$17BREVENUE
Danaher Today
Increasing environmental, healthcare and food safety
regulatory requirements and changes
Improving standards of care in high growth markets (HGM)
Proliferation of digital trends
Outstanding brands
Large installed base
Business Characteristics
Market leading positions
Resilient business models
Strong Secular Growth DriversBy Mix
Consumables
65%
Equipment
35%
Danaher Business System
Life Sciences Overview
ROW
10%NA
34%
EU
29%
HGM
27%Consumables
60%
Equipment
40%
By Mix
All financial metrics based on FY 2016.
Mid-teensOPERATING
MARGIN
~$5.4BREVENUE
Life Sciences Revenue 2016
Evolution of life science research
Growth of chronic diseases and infections
HGM investing in basic and applied research capacity
Food & beverage,
forensics, hospital/
reference labs
Growth Drivers
Pharma/biotech
Government, academic
and clinical research
Customers
By Geography
~$40BMARKET
SIZE
Diagnostics Overview
ROW
7%
NA
39%
EU
19%
HGM
35%Consumables
80%
Equipment
20%
By Mix
Mid-
teensOPERATING
MARGIN
~$5.0BREVENUE
Diagnostics Revenue 2016 Rapid growth in healthcare expenditures in HGM
Greater investment in preventative, predictive medicine
Skilled labor shortage, cost pressures necessitating
automated solutions
Hospital critical care
Histopathology labs
Growth Drivers
Hospital labs
Reference labs
Customers
By Geography
~$35BMARKET
SIZE
All financial metrics based on FY 2016.
Dental Overview
Mid-
teensOPERATING
MARGIN
~$2.8BREVENUE
Global demographic trends – aging population
Growing middle class in high growth markets
Digitizing the dental practice
Cosmetic and aesthetics dentistry
Group practices
Schools, hospitals,
government
Growth Drivers
General practices
Specialists: Endo / Ortho
Perio / Surgical
Customers
~$20BMARKET
SIZE
Dental Revenue 2016
ROW
7%
NA
51%
EU
23%
HGM
19%
Consumables
70%
Equipment
30%
By Mix By Geography
All financial metrics based on FY 2016.
Water Quality Overview
Mid-20sOPERATING
MARGIN
~$2.1BREVENUE
Increasing regulatory requirements and changes
Water scarcity/drought conditions, sustainability
Demand for full workflow solutions, efficiency
Growth Drivers
Customers
~$15BMARKET
SIZE
Municipal water facilities (waste & drinking water)
Industrial applications (food & beverage, pharma,
chemical, power)
Research & environmental, agriculture/irrigation
ROW
2%
NA
52%
EU
18%
HGM
28%
Consumables
60%
Equipment
40%
By Mix
Water Quality Revenue 2016
By Geography
All financial metrics based on FY 2016.
Product ID Overview
ROW
4%NA
31%
EU
30%
HGM
35%Consumables
55%
Equipment
45%
By Mix
Mid-20sOPERATING
MARGIN
~$1.6BREVENUE
PID Revenue 2016
Demand for brand consistency
Consumer product safety and traceability
Changing consumer behavior in HGM
Packaging used to drive demand, now a key element
in marketing campaigns
Packaging converters
& printers
Industrial products
Growth Drivers
Consumer packaged
goods (CPG)
Pharmaceuticals
Customers
By Geography
~$8BMARKET
SIZE
All financial metrics based on FY 2016.
Non-GAAP Reconciliations
Adjusted EPS guidance of $3.85-3.95
Danaher Corporation
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures
Free Cash Flow from Continuing Operations ($ in billions): 2013 2014 2015 2016
Operating Cash Flows from Continuing Operations (GAAP) 2.4$ 2.7$ 2.8$ 3.1$
Less: purchases of property, plant & equipment (capital expenditures) from
continuing operations (GAAP) (0.5) (0.5) (0.5) (0.6)
Free Cash Flow from Continuing Operations (Non-GAAP) 1.9$ 2.2$ 2.3$ 2.5$
Years Ended December 31
Year-Over-Year Core Operating Margin Changes
Total
Company Life Sciences Diagnostics Dental
Environmental
and Applied
Solutions
15.00% 9.90% 15.40% 13.50% 24.40%
Full year 2016 impact from operating profit margins of businesses that have
been owned for less than one year or were disposed of during such period
and did not qualify as discontinued operations(0.50) (0.15) (0.30) (0.10) (0.75)
Acquisition-related transaction costs deemed significant, change in control
payments and restructuring charges, and fair value adjustments to inventory
and deferred revenue, in each case primarily related to the acquisition of
Cepheid and incurred in the fourth quarter of 2016. (0.50) (0.10) (1.50) - -
Acquisition-related transaction costs deemed significant, change in control
payments, and fair value adjustments to inventory and deferred revenue, net
of the impact of freezing pension benefits, in each case related to the
acquisition of Pall Corporation and incurred in the second half of 2015. 0.90 3.90 - - -
2016 gains on resolution of acquisition-related matters0.10 - - - -
Fair value adjustments to Nobel Biocare acquisition-related inventory
incurred in the first quarter of 2015 0.15 - - 0.80 -
Year-over year core operating profit margin changes for full year 2016
(defined as all year-over-year operating profit margin changes other than the
changes identified in the line items above) (Non-GAAP)1.15 1.75 2.00 0.90 (0.05)
16.30% 15.30% 15.60% 15.10% 23.60%
Year Ended December 31, 2016 Operating Profit Margins from
Continuing Operations (GAAP)
Segments
Year Ended December 31, 2015 Operating Profit Margins from
Continuing Operations (GAAP)