This quarterly report on Form 10-Q, including the following management's discussion and analysis, contains forward-looking information that you should read in conjunction with the condensed consolidated financial statements and notes to condensed consolidated financial statements that we have included elsewhere in this report. For this purpose, any statements contained in this report that are not statements of historical fact may be deemed to be forward-looking statements. Words such as "believes," "plans," "anticipates," "intends," "expects," "will" and similar expressions are intended to identify forward-looking statements. Our actual results may differ materially from the plans, intentions or expectations we disclose in the forward-looking statements we make. We have included important factors below under the heading "Risk Factors" in Part II, Item 1A. that we believe could cause actual results to differ materially from the forward-looking statements we make. We are not obligated to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

We are a leading provider of technology, services and solutions to the diagnostics, research, environmental monitoring, safety and security, and laboratory services markets. Through our advanced technologies, applications, and services, we address critical issues that help to improve the health and safety of people and their environment.

We announced a new alignment of our businesses to allow us to prioritize our capabilities on two key strategic operating areas - Human Health and Environmental Health. We reorganized into these two new operating segments to align our resources to meet the demands of the markets we serve and to focus on the important outcomes enabled by our technologies. This new alignment became effective at the start of our fiscal year 2009. The results reported for this quarter reflect this new alignment of our operating segments. Financial information in this report relating to the first quarter of fiscal year 2008 has been retrospectively adjusted to reflect the changes in our operating segments. In conjunction with the realignment of our operating segments, we also redefined the reporting units we use to test for the impairment of goodwill related to our businesses. We performed our annual impairment testing as of January 1, 2009, our annual impairment date for our reporting units, and based on the first step of the process we concluded that there was no goodwill impairment.

Human Health

Our new Human Health segment concentrates on developing diagnostics, tools and applications to help detect disease earlier and more accurately and to accelerate the discovery and development of critical new therapies. Within the Human Health segment, we serve both the diagnostics and research markets. The Human Health segment includes our products and services that address the genetic screening and bio-discovery markets, formerly in our Life and Analytical Sciences segment, and our technology serving the medical imaging market, formerly in our Optoelectronics segment. In the first quarter of fiscal year 2009, our Human Health segment generated sales of $177.3 million.

Diagnostics Market:

We provide early detection for genetic disorders from pre-conception to early childhood as well as medical imaging for the diagnostics market. We provide early and accurate insights into the health of expectant mothers during pregnancy and their newborns. Our instruments, reagents and software test and screen for disorders and diseases, including Down syndrome, infertility, anemia and diabetes. Our medical imaging detectors are used to enable doctors to make faster and more accurate diagnosis of conditions ranging from broken bones to reduced blood flow in vascular systems. In addition, our detectors improve oncology treatments by focusing radiation directly at the tumors.

Research Market:

In the research market we provide a broad suite of solutions including reagents, liquid handling and detection technologies that enable researchers to improve the drug discovery process. These applications, solutions and services, enable pharmaceutical companies to create better therapeutics while helping to bring these therapeutics to market faster and more efficiently. The portfolio includes a wide range of systems consisting of instrumentation for automation and detection solutions, cellular imaging and analysis hardware and software, and a portfolio of consumables products, including drug discovery and research reagents. We sell our research solutions to pharmaceutical, biotechnology and academic research customers globally.

Environmental Health

Our new Environmental Health segment provides technologies and applications to facilitate the creation of safer food and consumer products, more secure surroundings and efficient energy resources. The Environmental Health segment serves the environmental, safety and security, industrial and laboratory services markets. The Environmental Health segment includes our products and services that address the analytical sciences and laboratory service and support markets, formerly in our Life and Analytical Sciences segment, and our technology designed for the sensors and specialty lighting markets, formerly in our Optoelectronics segment. In the first quarter of fiscal year 2009, our Environmental Health segment generated sales of $254.3 million.

Environmental and Safety and Security Markets:

For the environmental and safety and security markets, we provide analytical technologies that address the quality of our environment, sustainable energy development, and ensure safer food and consumer products as well as sensor and detection solutions that contribute to safer homes, offices and buildings.

We take an active part in minimizing the impact of products and industrial processes on our environment, including our water quality solutions to detect harmful substances, such as trace metal, organic, pesticide, chemical and radioactive contaminants, in the world's water supply. Through our EcoAnalytixTM initiative, we deliver systems that combine applications, methodologies, standard operating procedures and training required for the specific analyses required.

We also develop the sensors and detectors that maintain safe and sustainable environments. To ensure safety, our motion detectors automatically turn on and shut off lights and our gas sensors detect carbon dioxide in the air and then introduce oxygen to maintain optimal air quality. In addition, our sensors are integral to security systems, ensuring the safety of an environment from intruders.

Industrial Market:

We provide analytical instrumentation, detectors, and sensors for the industrial market which includes the semiconductor, chemical, lubricants, construction, office equipment and quality assurance industries.

Laboratory Services Market:

We have over 1,500 service engineers to support our customers throughout the world and to help them improve the productivity of their labs. Our OneSource service business strategy is aligned with customer needs to consolidate laboratory services and improve efficiencies within their labs.

Overview of the First Quarter of Fiscal Year 2009

Our fiscal year ends on the Sunday nearest December 31. We report fiscal years under a 52/53 week format, and as a result certain fiscal years will contain 53 weeks. Our 2009 fiscal year will include 53 weeks, whereas our 2008 fiscal year included 52 weeks. This additional week has been reflected in the first quarter of fiscal year 2009, which had 14 weeks compared to 13 weeks in the first quarter of fiscal year 2008.

The widespread nature of the current global economic contraction has continued the deterioration for a few of our end markets during the first quarter of fiscal year 2009; however several of our end markets performed better than we anticipated. Our overall sales in the first quarter of fiscal year 2009 declined $27.1 million, or 6%, as compared to the first quarter of fiscal year 2008, reflecting a decline of $2.8 million, or 2%, in our Human Health segment sales and a decline of $24.3 million, or 9%, in our Environmental Health segment sales. The decline in our Human Health segment sales is due primarily to the decreased demand for our medical imaging products, which has resulted from constraints on medical providers' capital budgets and a lack of financing availability. The decline in our Environmental Health segment sales is due primarily to private testing labs reducing capital purchases in response to lower demand and tight credit markets.

However, these declines have been offset in part by certain of our businesses operating in markets which are more isolated from current economic trends, or where our businesses have benefited from a push for more efficient spending, new opportunities from government regulations or possible future research spending. In our Human Health segment, we experienced strong growth in sales to the research market, including sales of our products to academic and clinical labs, during the first quarter of fiscal year 2009 as compared to that market in the first quarter of fiscal year 2008. We believe that, unlike the overall economy, the research market has stabilized and may potentially provide the opportunity for increased growth later in this fiscal year as funding from various government stimulus packages are directed towards specific areas of research. We also saw an increase in sales to the diagnostics market related to our genetic screening business during the first quarter of fiscal year 2009 as compared to that market in the first quarter of fiscal year 2008. As the rising cost of healthcare continues to be one of the critical issues contributing to the economic downturn, we anticipate that while there is continued pressure on lab budgets, we may see growth in our newborn screening business later this fiscal year as the benefits of providing earlier detection of disease, which can result in savings of long-term health care cost as well as creating better outcomes for patients, are increasingly valued.

In our Environmental Health segment, our laboratory services business enables our customers to drive efficiencies, increase production time and reduce maintenance costs, all of which are increasingly critical in this weakened economic environment. During the first quarter of fiscal year 2009, we added a number of new customers to our OneSource multivendor service and continued to gain good momentum for that program in markets beyond our traditional customer base. In addition, the strong growth from OneSource more than offset the opposing trend we have seen of customers deferring maintenance spending for analytical instruments. The increase in sales to the laboratory service market partially offset decreased sales to the environmental, safety and security and industrial markets. While overall sales to the safety and security market was driven down by the decline in spending in the pharmaceutical market, sales of consumer and food testing products grew in the first quarter of fiscal year 2009 due to increased demand for mercury, lead and pesticide testing as well as to new testing requirements for consumer product safety applications.

We experienced 167 basis points of expansion in gross margins for the first quarter of fiscal year 2009 as compared to the first quarter of fiscal year 2008. This expansion was driven primarily by productivity improvements and product mix, especially growth in higher gross margin product offerings. However, our consolidated operating profit declined approximately 23% in the first quarter of fiscal year 2009 as compared to the first quarter of fiscal year 2008, primarily related to the adverse impact of the $7.8 million of restructuring charges, primarily in headcount, taken during the first quarter of fiscal year 2009 in anticipation of decreasing demand in certain end markets.

We believe we are well positioned to continue to take advantage of our end markets where spending trends have countered the prevailing downturn, and to promote our efficiencies in markets where current conditions may increase demand for certain services. Overall, we believe that our strategic focus on Human Health and Environmental Health coupled with our breadth of end markets, deep portfolio of technologies and applications, leading market positions, global scale and financial strength will provide us with a strong foundation to weather the current economic climate.

Recent Developments

Acquisitions:

Acquisition of Analytica of Branford, Inc. In May 2009, we acquired the outstanding stock of Analytica of Branford, Inc. ("Analytica"). Analytica is a leading developer of mass spectrometry and ion source technology. We expect this acquisition to allow us to offer our customers access to critical technologies such as time-of-flight and quadrupole mass spectrometers and new ion sources that provide more complete information as well as better throughput. We will also gain significant intellectual property in the field of mass spectrometry and ion source technology. The excess of the purchase price over the fair value of the acquired net assets represents cost and revenue synergies specific to us as well as non-capitalizable intangible assets, such as the employee workforce acquired. We paid the shareholders of Analytica approximately $24.0 million in cash for this acquisition. The excess of the purchase price over the fair value of the acquired net assets will be allocated to goodwill, which may be tax deductible if elected by us. We expect to report the operations for this acquisition within the results of our Environmental Health segment from the acquisition date.

Acquisition of Opto Technology Inc. In January 2009, we acquired the outstanding stock of Opto Technology Inc. ("Opto Technology"). Opto Technology is a supplier of light-emitting diode based lighting components and subsystems. We expect this acquisition to expand our portfolio of high brightness LED components by adding optical subsystems to provide energy efficient solid state lighting solutions to original equipment manufacturers. The excess of the purchase price over the fair value of the acquired net assets represents cost and revenue synergies specific to us as well as non-capitalizable intangible assets, such as the customer base acquired. We paid the shareholders of Opto Technology approximately $20.6 million in cash for this acquisition plus $8.0 million in potential additional contingent consideration, of which we recorded $4.9 million as the fair value at the acquisition date. During the first quarter of fiscal year 2009, we received approximately $0.2 million from the former shareholders of Opto Technology for net working capital adjustments. The excess of the purchase price over the fair value of the acquired net assets has been allocated to goodwill, none of which is tax deductible. We report the operations for this acquisition within the results of our Environmental Health segment from the acquisition date.

Leadership transition:

On April 28, 2009, our Board of Directors (our "Board") elected Frank Anders Wilson to serve as our Chief Financial Officer, Chief Accounting Officer, and Senior Vice President, effective as of Mr. Wilson's assumption of his responsibilities and commencement of his employment in May 2009. Mr. Wilson joins us after 12 years at Danaher Corporation ("Danaher"), a leading industrial company, where he served as Corporate Vice President of Investor Relations since 2003. From 1997 to 2003, Mr. Wilson also held several other senior management positions with Danaher. Prior to joining Danaher, Mr. Wilson worked for AlliedSignal Inc. from 1994 to 1997 where he last served as Vice President of Finance and Chief Financial Officer of Commercial Aviations Systems. Mr. Wilson holds a Bachelor of Arts degree in accounting from Baylor University. Mr. Wilson is also a Certified Public Accountant.

Critical Accounting Policies and Estimates

The preparation of condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, sales and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to bad debts, inventories, intangible assets, income taxes, restructuring, pensions and other post-retirement benefits, stock-based compensation, warranty costs, contingencies and litigation. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Critical accounting policies are those policies that affect our more significant judgments and estimates used in the preparation of our condensed consolidated financial statements. We believe our critical accounting policies include our policies regarding revenue recognition, allowances for doubtful accounts, inventory valuation, business combinations, value of long-lived assets, including intangibles, employee compensation and benefits, restructuring activities, gains or losses on dispositions and income taxes.

For a more detailed discussion of our critical accounting policies, please refer to our Annual Report on Form 10-K for the fiscal year ended December 28, 2008, as filed with the Securities and Exchange Commission (the "SEC") (the "2008 Form 10-K").

Consolidated Results of Continuing Operations

Sales

Sales for the three months ended April 5, 2009 were $431.6 million, as compared to $458.7 million for the three months ended March 30, 2008, a decrease of $27.1 million, or 6%, which includes an approximate 7% decrease in sales attributable to unfavorable changes in foreign exchange rates and an approximate 1% increase from acquisitions. The three months ended April 5, 2009 had 14 weeks compared to 13 weeks for the three months ended March 30, 2008. The analysis in the remainder of this paragraph compares segment sales for the three months ended April 5, 2009 as compared to the three months ended March 30, 2008 and includes the effect of foreign exchange rate fluctuations and acquisitions. The total decrease in sales reflects a $2.8 million, or 2%, decrease in our Human Health segment sales, due to a decrease in diagnostics market sales of $5.9 million, which was partially offset by an increase in research market sales of $3.1 million. Our Environmental Health segment sales decreased $24.3 million, or 9%, primarily due to decreases in environmental, safety and security and industrial markets sales of $26.5 million, which was partially offset by an increase in laboratory services market sales of $2.2 million.

Cost of Sales

Cost of sales for the three months ended April 5, 2009 was $243.6 million, as compared to $266.6 million for the three months ended March 30, 2008, a decrease of approximately $23.0 million, or 9%. As a percentage of sales, cost of sales decreased to 56.4% for the three months ended April 5, 2009, from 58.1% for the three months ended March 30, 2008, resulting in an increase in gross margin of 167 basis points to 43.6% for the three months ended April 5, 2009, from 41.9% for the three months ended March 30, 2008. Amortization of intangible assets decreased and was $8.8 million for the three months ended April 5, 2009 as compared to $9.2 million for the three months ended March 30, 2008. Stock option expense was $0.3 million for both the three months ended April 5, 2009 and March 30, 2008. The amortization of purchase accounting adjustments to record the inventory from certain acquisitions completed in fiscal year 2009 was approximately $0.2 million for the three months ended April 5, 2009. The increase in gross margin was primarily the result of the combined favorable impact of productivity improvements and product mix, especially growth in higher gross margin products.

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the three months ended April 5, 2009 were $128.4 million as compared to $130.8 million for the three months ended March 30, 2008, a decrease of approximately $2.4 million, or 2%. As a percentage of sales, selling, general and administrative expenses were 29.8% for the three months ended April 5, 2009 as compared to 28.5% for the three months ended March 30, 2008. Amortization of intangible assets was $4.2 million for the three months ended April 5, 2009 as compared to $3.9 million for the three months ended March 30, 2008. Stock option expense was $1.6 million for both the three months ended April 5, 2009 and March 30, 2008. Purchase accounting adjustments for contingent consideration and other acquisition costs related to certain acquisitions completed in fiscal year 2009 were approximately $1.0 million for the three months ended April 5, 2009. The decrease in selling, general and administrative expenses was primarily the result of increased sales and marketing expenses, particularly in emerging territories, and increased pension expenses, offset by foreign exchange.

Research and Development Expenses

Research and development expenses for the three months ended April 5, 2009 were $26.0 million as compared to $27.8 million for the three months ended March 30, 2008, a decrease of $1.9 million, or 7%. As a percentage of sales, research and development expenses were flat for the three months ended April 5, 2009 as compared to the three months ended March 30, 2008. Amortization of intangible assets was $0.5 million for both the three months ended April 5, 2009 and March 30, 2008. Research and development expenses also included stock option expense of $0.1 million for both the three months ended April 5, 2009 and March 30, 2008. We directed research and development efforts similarly during fiscal years 2009 and 2008, primarily toward the diagnostics and research markets within our Human Health segment, and the environmental and safety and security markets within our Environmental Health segment, in order to help accelerate our growth initiatives.

Restructuring and Lease Charges, Net

We have undertaken a series of restructuring actions related to the impact of acquisitions, divestitures and the integration of our business units. Restructuring actions were recorded in accordance with Statement of Financial Accounting Standards ("SFAS") No. 146, "Accounting for Costs Associated with Exit or Disposal Activities."

A description of the restructuring plans and the activity recorded for the three months ended April 5, 2009 is listed below. Details of the plans initiated in previous years, particularly those listed under "Previous Restructuring and Integration Plans," are discussed more fully in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the 2008 Form 10-K.

The restructuring plan for the first quarter of fiscal year 2009 was principally to reduce resources in anticipation of decreasing demand in certain end markets. The restructuring plan for the third quarter of fiscal year 2008 was principally to shift resources into geographic regions and product lines that are more consistent with our growth strategy. The activities associated with these plans have been reported as restructuring expenses as a component of operating expenses from continuing operations. We expect the impact of immediate cost savings from the first quarter of fiscal year 2009 restructuring plan on operating results and cash flows to approximately offset the decline in revenue. We expect the impact of future cost savings from these restructuring activities on operating results and cash flows to be negligible, as we will incur offsetting costs.

Q1 2009 Plan

During the first quarter of fiscal year 2009, our management approved a plan to reduce resources in anticipation of decreasing demand in certain end markets (the "Q1 2009 Plan"). As a result of the Q1 2009 Plan, we recognized a $3.0 million pre-tax restructuring charge in the Environmental Health segment related to a workforce reduction from reorganization activities and the closure of an excess facility. We also recognized a $4.8 million pre-tax restructuring charge in the Human Health segment related to a workforce reduction from reorganization activities and the closure of an excess facility. All actions related to the Q1 2009 Plan were completed by April 5, 2009.

The following table summarizes the Q1 2009 Plan activity for the three months ended April 5, 2009:

                                                                             Closure
                                     Headcount        Severance         of Excess Facility         Total
                                                                    (Dollars in thousands)
Provision                                  166       $     7,365       $                458       $  7,823
Amounts paid and foreign
currency translation                       (79 )          (1,283 )                      (83 )       (1,366 )

Balance at April 5, 2009                    87       $     6,082       $                375       $  6,457

All employee relationships have been severed and we anticipate that the remaining severance payments of $6.1 million for workforce reductions will be completed by the end of the fourth quarter of fiscal year 2010. We also anticipate that the remaining payments of $0.4 million for the closure of the excess facility will be paid through fiscal year 2012, in accordance with the terms of the applicable leases.

Q3 2008 Plan

During the third quarter of fiscal year 2008, our management approved a plan to shift resources into product lines that are more consistent with our growth strategy (the "Q3 2008 Plan"). As a result of the Q3 2008 Plan, we recognized a $3.3 million pre-tax restructuring charge in the Environmental Health segment related to a workforce reduction from reorganization activities and the closure of excess facilities. We also recognized a $4.5 million pre-tax restructuring charge in the Human Health segment related to a workforce reduction from reorganization activities and the closure of excess facilities. All actions related to the Q3 2008 Plan were completed by September 28, 2008.

The following table summarizes the Q3 2008 Plan activity for the three months ended April 5, 2009:

                                                                       Closure
                                              Severance          of Excess Facilities          Total
                                                              (Dollars in thousands)
Balance at December 28, 2008                 $     2,659        $                1,152        $  3,811
Amounts paid and foreign currency
translation                                       (1,005 )                        (163 )        (1,168 )
. . .