Profit Drops at Danaher, Orbital Sciences
From wire reports
Danaher of the District said third-quarter profit dropped 23 percent, to $371.9 million ($1.11 a share) from $483.7 million ($1.03) in the comparable quarter a year earlier. Revenue for the diversified manufacturer that makes bar code readers, medical products, and Sears' Craftsman tools was up 17 percent, to $3.21 billion.
The results for the most recent quarter included certain noncash charges related to the acquisition of Tektronix for fair value adjustments to recorded inventory and deferred revenue, which reduced net earnings by approximately $10 million, or 3 cents per share, in the period.
"Clearly, the events of the last several weeks have created a level of uncertainty with respect to the global economy," said H. Lawrence Culp Jr., president and chief executive, in a statement. He noted, however, that the company's portfolio of high-quality businesses and talented organization gives "us confidence that we can outperform during these challenging times."
Culp said in a conference call that the company plans to eliminate 1,000 jobs and close 12 factories to "get ready for what may come" as the U.S. economy falters.
Culp, 45, has been reducing Danaher's reliance on consumer- oriented businesses that are more prone to economic slowdowns and last year bought 12 companies including test equipment maker Tektronix, its biggest purchase ever. Still, the credit crisis prompted him to speed restructuring plans by spending $75 million next quarter on the job cuts and plant closures.
"The businesses most impacted will be those with lower margins, those that are feeling or are likely to feel the impact of the economy most directly," Culp said. "But again, even some of our higher margin, better performing businesses will be taking actions to get ready for what may come. It'll better position us in 2009."
Andy Wilson, a Danaher spokesman, didn't immediately respond to a message seeking the timing of the job cuts and plant closings. Danaher had 50,000 employees as of the end of last year, according to Bloomberg data.
Orbital Sciences of Dulles said third-quarter earnings fell 23 percent, mostly due to one-time charges, but its adjusted results beat Wall Street's expectations. Profit was $12.1 million (20 cents), down from $15.7 million (26 cents). The company attributed its earnings shortfall mostly to a $1 million investment impairment charge and a $1.7 million reduction in interest and other income in the third quarter of 2008. Revenue edged up by 1 percent to $278.6 million, from $275.6 a year earlier.
The maker of small rockets and space systems on Thursday narrowed its earnings forecast for the full year, and predicted 2009 results below Wall Street's expectations. The company now expects to post adjusted earnings per share, excluding some one-time items, of 96 cents to 99 cents. Its previous prediction was 93 cents per share to 97 cents per share. The company's forecast excludes an $11.6 million investment write-down. Orbital predicts revenue of $1.12 billion to $1.14 billion, compared with a previous prediction of $1.1 billion to $1.13 billion.
For 2009, the company expects to earn 85 cents per share to 92 cents per share, with sales of $1.18 billion to $1.2 billion.
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