Income from discontinued operations before income taxes

[Table of Contents](#ia72a687f7b8a4bb1b43219ab5b663314_7)related assets and liabilities) attributable to periods prior to, at and after Envista’s separation from Danaher and govern certain relationships between Danaher and Envista after the Envista Separation. In addition, Danaher is also party to various commercial agreements with Envista entities. The amounts paid and received by Danaher for transition services provided under the above agreements as well as sales and purchases to and from Envista were not material to the Company’s results of operations for the years ended December 31, 2021, 2020 and 2019.The key components of income from Envista from discontinued operations for the year ended December 31, 2019 were as follows ($ in millions):

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |
| Sales |  |  |  |  | $ | 2,610  |  |
| Cost of sales |  |  |  |  | (1,177) |  |
| Selling, general and administrative expenses |  |  |  |  | (1,095) |  |
| Research and development expenses |  |  |  |  | (152) |  |
| Other income (expense), net |  |  |  |  | 2  |  |
| Interest expense |  |  |  |  | (9) |  |
| Income from discontinued operations before income taxes |  |  |  |  | 179  |  |
| Gain on disposition of Envista before income taxes |  |  |  |  | 451  |  |
| Earnings from discontinued operations before income taxes |  |  |  |  | 630  |  |
| Income taxes |  |  |  |  | (41) |  |
| Earnings from discontinued operations, net of income taxes |  |  |  |  | 589  |  |
| Net earnings attributable to noncontrolling interest |  |  |  |  | (13) |  |
| Net earnings from discontinued operations attributable to common stockholders |  |  |  |  | $ | 576  |  |

  
NOTE 4. NET EARNINGS PER COMMON SHARE FROM CONTINUING OPERATIONS Basic net earnings per share from continuing operations (“EPS”) is calculated by taking net earnings from continuing operations less the MCPS dividends divided by the weighted average number of common shares outstanding for the applicable period. Diluted net EPS from continuing operations is computed by taking net earnings from continuing operations plus the interest accrued on the Company’s LYONs (prior to their redemption in January 22, 2021) less the MCPS dividends divided by the weighted average number of common shares outstanding increased by the number of additional shares that would have been outstanding had the potentially dilutive common shares been issued and reduced by the number of shares the Company could have repurchased with the proceeds from the issuance of the potentially dilutive shares. For the years ended December 31, 2021 and 2019, no options to purchase shares were excluded from the diluted earnings per share calculation. For the year ended December 31, 2020, 1 million options to purchase shares were excluded from the diluted earnings per share calculation, as the impact of their inclusion would have been anti-dilutive. Basic and diluted EPS are computed independently for each quarter and annual period, which involves the use of different weighted-average share count figures relating to quarterly and annual periods. As a result, and after factoring the effect of rounding to the nearest cent per share, the sum of prior quarter-to-date EPS figures may not equal annual EPS.The impact of the MCPS Series A calculated under the if-converted method was dilutive for the year ended December 31, 2021, and as such 11.0 million shares underlying the MCPS Series A were included in the calculation of diluted EPS for the year ended December 31, 2021 and the related MCPS Series A dividends of $78 million were excluded from the calculation of net earnings for diluted EPS for the period. The impact of the MCPS Series B calculated under the if-converted method was anti-dilutive for the year ended December 31, 2021, and as such 8.6 million shares underlying the MCPS Series B were excluded from the diluted EPS calculation for the year ended December 31, 2021 and the related MCPS Series B dividends of $86 million were included in the calculation of net earnings for diluted EPS for the period. The impact of the MCPS Series A and Series B calculated under the if-converted method was anti-dilutive for the years ended December 31, 2020 and 2019, and as such, 17.1 million and 10.0 million shares, respectively, underlying the MCPS Series A and Series B were excluded from the calculation of diluted EPS and the related MCPS Series A and Series B dividends of $136 million and $68 million, respectively, were included in the calculation of net earnings for diluted EPS for the period. 77
