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During the presentation, we will describe certain of the more significant factors that impacted year-over-year performance. Please refer to the accompanying slide presentation, our earnings release, our second quarter Form 10-Q and other related presentation materials supplementing today's call for additional factors that impacted year-over-year performance.I'd also like to note that we'll be making some forward-looking statements during the call, including statements regarding events or developments that we believe or anticipate will or may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties, including those set forth in our SEC filings. It is possible that actual results might differ materially from any forward-looking statements that we might make today. These forward-looking statements speak only as of the date that they are made, and we do not assume any obligation to update any forward-looking statements whether as a result of new information, future events and developments or otherwise. With that, I would like to turn the call over to Larry. H. Culp Matt, thanks. Good morning, everyone. I'll begin this morning by giving some color around what we are seeing across our businesses and end markets to give you a framework for our solid second quarter results and our outlook for the balance of the year. We continue to see encouraging signs across the global economy. We grew 14% in the second quarter on a core basis. Our core growth was broad-based with Professional Instrumentation growth of 19%, Industrial Tech growth of 15.5% and Med Tech coming in up 4.5%. Our enhanced commitment over the last several years to organic growth, both in the form of the expansion of the Danaher Business System, as well as increased investments in new product developments and sales and marketing initiatives is evident in this solid core growth performance.
As a result of these efforts, we continue to capture market share in many of our businesses. Leica, DEXIS, Hach Lange, ChemTreat, Gilbarco Veeder-Root and Radiometer are among the businesses where we believe we are taking market share.Geographically, emerging markets were our best performers, up more than 25% in the quarter. Emerging markets now represent about 20% of total sales, up 16% from three years ago, representing a low teen compounded annual growth rate. The U.S. grew low double digits, and Europe was up high single digits. Given the recent headlines in Europe, we've been paying particular attention to that region. By and large, what we saw on the quarter suggested that our Western European business, which is largely dependent on Germany, France, the U.K. and the Nordics, is healthy. But we are again watching that space very carefully. The quality of the core growth was evident in the outstanding margin performance in the quarter, with our core operating margin improving year-over-year by over 300 basis points, which, when combined with our sales growth, resulted in second quarter adjusted EPS up 40% over the prior year. So with that as a backdrop, let me move to the details of the quarter. Today, we reported second quarter GAAP earnings per diluted share of $0.55, up 25% year-over-year. Adjusted net earnings per diluted share was $0.56, up 40% year-over-year. Our EPS performance reflects the 2-for-1 stock split, which took effect in June. Revenues for the quarter increased 24% to a record $3.3 billion, with core revenues up 14%. The impact of currency translation decreased revenues by 1%, while acquisitions contributed 11% to sales growth. Year-over-year gross margin for the second quarter increased 230 basis points to 49.5%, largely due to higher sales volumes and the benefit of our 2009 restructuring initiatives. Operating margin in the second quarter increased 320 basis points year-over-year to 16.1%, resulting from higher sales volumes and the benefit of our prior year's restructuring initiatives. Year-to-date, the operating cash flow was a record $932 million, a 16% increase year-over-year. Free cash was $839 million, and our free cash to net income conversion ratio was 125%. This outstanding cash flow performance is due principally to the quality of our growth and our team's solid execution on working capital. Read the rest of this transcript for free on seekingalpha.com