The gains in International were due to strong growth in Latin America and modest growth elsewhere. The increase in the U.S. reflects strong markets and share gains. Overseas, strong markets in Latin America and the effect of including the results of the operations in China more than offset the expected declines elsewhere in the Far East. Strong performance in the U.S. commercial and residential businesses was partly offset by lower margins in the Far East and Europe. Higher operating income in the U.S. and Latin America and the consolidation of China operating results more than offset the effects of economic weakness in the rest of Asia and interim costs associated with the low-cost sourcing program in Europe.
Emphasis continues on U.S. and European regulatory approvals of new diagnostic products and tests.
The lower 1997 rate resulted from the utilization of certain previously unrecognized tax benefits. No similar benefits are available in 1998. The Company expects to record this restructuring charge, in the third quarter of this year. Comments in this earnings release contain certain forward-looking statements which are based on management s good faith expectations and belief concerning future developments.