- The Washington Times - Monday, December 3, 2001

The head of Danaher Corporation conceded to investors last week that the company was getting slammed by the current economy.
"Danaher continues to feel the effects of a significant manufacturing recession," company Chief Executive Officer H. Lawrence Culp Jr. said Friday before an investors conference sponsored by Lehman Brothers.
Danaher manufactures environmental controls, tools and components, as well as the popular Craftsman line of tools sold at Sears stores.
Mr. Culp says sales in October dropped at a "low double digit rate" over the year and that reports on November sales indicated no improvement. His comments raise questions about whether Danaher will continue its trend of increasing earnings despite harsh economic conditions.
In October, the company reported third-quarter earnings of $264.6 million, or $1.78 per share compared to $236.4 million, or $1.63 per share during the like quarter in 2000. The growth has come largely due to the company's significant efforts in reducing costs. Sales actually decreased in the third quarter, from $906.1 million, down from $986.8 million in the like quarter of 2000.
"We continue to implement aggressive cost reductions as the recession runs its course," Mr. Culp says. "We are particularly focused on positioning our cost structure for continuing market softness in 2002 so that we continue to outperform in difficult economic conditions."
The company's struggles have had little effect on its stock price, which has actually increased gradually over the past two months. Many analysts remain fans of the company, citing strong management and balance of internal and external growth.
"Danaher remains one of the highest rated companies I follow," says Janney Montgomery Scott analyst James Lucas, who covers most prominent industrial manufacturing companies. He rates the stock "accumulate," and blames the company's sales decline on the current macro-economic situation.
"They are still growing and have a very healthy balance sheet," he says.

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