TIDMABT
RNS Number : 7918T
Abbott Laboratories
22 July 2015
Abbott Reports Second-Quarter 2015 Results
- SECOND-QUARTER ADJUSTED AND GAAP EPS FROM CONTINUING
OPERATIONS OF $0.52, ABOVE PREVIOUS GUIDANCE RANGE
- SECOND-QUARTER DOUBLE-DIGIT OPERATIONAL SALES GROWTH
- ADVANCES SEVERAL NEW TECHNOLOGIES IN ITS MEDICAL DEVICES AND
DIAGNOSTICS BUSINESSES
ABBOTT PARK, Ill., July 22, 2015 /PRNewswire/ -- Abbott (NYSE:
ABT) today announced financial results for the second quarter ended
June 30, 2015.
-- Second-quarter worldwide sales of $5.2 billion increased 10.8
percent on an operational basis and 2.2 percent on a reported
basis. Worldwide sales increased 6.4 percent excluding the impact
of 2014 acquisitions and foreign exchange.
-- Diluted EPS from continuing operations on both an adjusted
and GAAP basis was $0.52 in the second quarter.
-- Abbott's full-year 2015 adjusted EPS guidance range for
continuing operations remains unchanged at $2.10 to $2.20.
Projected full-year 2015 EPS for continuing operations under GAAP
is $1.50 to $1.60.
-- Second-quarter gross margin ratio was ahead of expectations,
primarily driven by continued improvements in Diagnostics and
Nutrition.
-- In the second quarter, Abbott received European approval for
Absorb GT1(TM) , which combines the world's first fully dissolving
stent with a next-generation delivery catheter; completed
submissions for regulatory approval of Absorb in Japan and the
U.S.; submitted for U.S. regulatory approval of its FreeStyle(R)
Libre Pro Flash Glucose Monitoring System for professional use; and
received U.S. FDA clearance for a first-of-its-kind blood test for
its i-STAT(R) handheld system to aid in detecting early pregnancy
in emergency situations.
"We've achieved another quarter of strong sales growth led by
our global diagnostics and branded generics businesses," said Miles
D. White, chairman and chief executive officer, Abbott. "We're well
on track to achieve our financial objectives for the year despite a
challenging currency environment."
SECOND-QUARTER BUSINESS OVERVIEW
Note: Prior year financial results have been adjusted to exclude
the sales from Abbott's developed markets branded generics
pharmaceuticals and animal health businesses that were sold to
Mylan and Zoetis, respectively, in the first quarter 2015.
Therefore, sales and growth rates shown in the following charts
represent continuing operations.
Following are sales by business segment and commentary for the
second quarter and first half of the year:
Total Company
($ in millions)
% Change vs. 2Q14
-----------------------------------------------------------------
Sales 2Q15 Int'l Total
------------------------------ --------------------------- --------------------------
U.S. Int'l Total U.S. Operational Reported Operational Reported
------- ------- ------- ------ ------------- ---------- ------------- ----------
Total * 1,592 3,578 5,170 3.1 14.2 1.8 10.8 2.2
------- ------- ------- ------ ------------- ---------- ------------- ----------
Nutrition 729 988 1,717 0.6 6.3 (1.9) 3.9 (0.8)
Diagnostics 350 827 1,177 7.6 9.0 (4.3) 8.7 (1.0)
Established
Pharmaceuticals -- 977 977 n/a 46.0 31.3 46.0 31.3
Medical Devices 505 784 1,289 3.0 3.1 (11.2) 3.1 (6.1)
* Total Abbott Sales from continuing operations include Other Sales of $10 million.
% Change vs. 1H14
------------------------------------------------------------------
Sales 1H15 Int'l Total
---------------------------- -------------------------- ----------------------------
U.S. Int'l Total U.S. Operational Reported Operational Reported
------- ------- -------- ------ ------------- ---------- --------------- ----------
Total * 3,094 6,973 10,067 2.5 13.9 2.6 10.4 2.6
------- ------- -------- ------ ------------- ---------- --------------- ----------
Nutrition 1,414 1,972 3,386 -- 8.7 1.2 5.0 0.7
Diagnostics 677 1,593 2,270 6.6 7.6 (4.6) 7.3 (1.6)
Established
Pharmaceuticals -- 1,874 1,874 n/a 44.5 31.5 44.5 31.5
Medical Devices 990 1,525 2,515 3.3 1.4 (11.7) 2.1 (6.3)
* Total Abbott Sales from continuing operations include Other Sales of $22 million.
n/a = Not Applicable.
Note: Operational growth reflects percentage change over the prior year excluding the impact
of exchange rates.
Second-quarter 2015 worldwide sales of $5.2 billion increased
10.8 percent on an operational basis and 2.2 percent on a reported
basis, including an unfavorable 8.6 percent effect of foreign
exchange. Worldwide sales increased 6.4 percent excluding the
impact of 2014 acquisitions and foreign exchange, driven by strong
performance in Established Pharmaceuticals and Diagnostics.
International sales increased 14.2 percent on an operational
basis and 1.8 percent on a reported basis in the second
quarter.
Emerging market sales increased 20.6 percent on an operational
basis and 10.0 percent on a reported basis in the second quarter.
Excluding the impact of 2014 acquisitions and foreign exchange,
emerging market sales increased double digits in the quarter.
Nutrition
($ in millions)
% Change vs. 2Q14
-------------------------------------------------------------
Sales 2Q15 Int'l Total
------------------------ ------------------------- -------------------------
U.S. Int'l Total U.S. Operational Reported Operational Reported
------ ------- ------- ------- ------------- ---------- ------------- ----------
Total 729 988 1,717 0.6 6.3 (1.9) 3.9 (0.8)
------ ------- ------- ------- ------------- ---------- ------------- ----------
Pediatric 401 567 968 2.0 5.2 (1.2) 3.9 0.1
Adult 328 421 749 (1.1) 7.7 (2.7) 3.9 (2.0)
% Change vs. 1H14
-------------------------------------------------------------
Sales 1H15 Int'l Total
------------------------- ------------------------- -------------------------
U.S. Int'l Total U.S. Operational Reported Operational Reported
------- ------- ------- ------- ------------- ---------- ------------- ----------
Total 1,414 1,972 3,386 -- 8.7 1.2 5.0 0.7
------- ------- ------- ------------- ---------- ------------- ----------
Pediatric 786 1,144 1,930 3.2 8.4 2.3 6.3 2.7
Adult 628 828 1,456 (3.8) 9.2 (0.3) 3.5 (1.8)
Worldwide Nutrition sales increased 3.9 percent in the second
quarter on an operational basis and decreased 0.8 percent on a
reported basis, including an unfavorable 4.7 percent effect of
foreign exchange.
Worldwide Pediatric Nutrition sales increased 3.9 percent on an
operational basis and 0.1 percent on a reported basis in the
quarter, including an unfavorable 3.8 percent effect of foreign
exchange. Growth in the quarter was driven by double-digit
operational growth in China and several countries in Latin America,
partially offset by market dynamics in certain Asian countries.
Abbott continues to broaden its pediatric nutrition portfolio in
China and recently launched an organic version of its infant
formula Eleva (TM) into the premium segment of the Chinese infant
formula market. In the U.S., Abbott provided parents with another
formula choice for their babies by launching Similac(R) Advance(R)
non-GMO.
Worldwide Adult Nutrition sales increased 3.9 percent on an
operational basis and decreased 2.0 percent on a reported basis in
the quarter, including an unfavorable 5.9 percent effect of foreign
exchange. Sales growth in the quarter was led by international
performance, including double-digit operational growth in Latin
America, as Abbott continues to shape and grow its priority
international markets. As expected, U.S. Adult Nutrition sales were
impacted by competitive and market dynamics, primarily in the
institutional segment.
Diagnostics
($ in millions)
% Change vs. 2Q14
-------------------------------------------------------------
Sales 2Q15 Int'l Total
----------------------- ------------------------- -------------------------
U.S
. Int'l Total U.S. Operational Reported Operational Reported
----- ------- ------- ------- ------------- ---------- ------------- ----------
Total 350 827 1,177 7.6 9.0 (4.3) 8.7 (1.0)
----- ------- ------- ------- ------------- ---------- ------------- ----------
Core
Laboratory 206 741 947 8.6 8.4 (4.9) 8.4 (2.3)
Molecular 50 66 116 (3.8) 18.3 2.6 8.4 (0.3)
Point of
Care 94 20 114 12.7 7.3 (1.7) 11.6 9.8
% Change vs. 1H14
-------------------------------------------------------------
Sales 1H15 Int'l Total
----------------------- ------------------------- -------------------------
U.S
. Int'l Total U.S. Operational Reported Operational Reported
----- ------- ------- ------- ------------- ---------- ------------- ----------
Total 677 1,593 2,270 6.6 7.6 (4.6) 7.3 (1.6)
----- ------- ------- ------- ------------- ---------- ------------- ----------
Core
Laboratory 391 1,422 1,813 5.3 6.9 (5.3) 6.6 (3.2)
Molecular 98 129 227 (0.4) 14.2 0.4 7.9 --
Point of
Care 188 42 230 13.7 12.6 4.5 13.5 11.9
Worldwide Diagnostics sales increased 8.7 percent in the second
quarter on an operational basis and decreased 1.0 percent on a
reported basis, including an unfavorable 9.7 percent effect of
foreign exchange. This business continues to deliver above-market
growth across emerging and developed markets.
Core Laboratory Diagnostics sales increased 8.4 percent in the
quarter on an operational basis and decreased 2.3 percent on a
reported basis, including an unfavorable 10.7 percent effect of
foreign exchange. Above-market sales growth this quarter, including
double-digit operational sales growth in emerging markets, was
driven by share gains in the U.S. and internationally as this
business continues to win key new accounts with its
customer-focused solutions.
Molecular Diagnostics sales increased 8.4 percent in the quarter
on an operational basis and decreased 0.3 percent on a reported
basis, including an unfavorable 8.7 percent effect of foreign
exchange. Abbott's core focus area of infectious disease testing,
which represents approximately 55 percent of its Molecular
Diagnostics sales, increased double digits in the quarter on an
operational basis. As expected, U.S. growth was impacted by
continued market dynamics in the oncology business and the planned
scale down of the genetics business.
Point of Care Diagnostics sales increased 11.6 percent in the
quarter on an operational basis as this business continues to build
and expand its presence in targeted developed and emerging markets.
Sales increased 9.8 percent on a reported basis, including an
unfavorable 1.8 percent effect of foreign exchange. In the second
quarter, Abbott received U.S. FDA clearance for its i-STAT Total
<BETA>-hCG test, a first-of-its-kind handheld and whole blood
point of care test that can rapidly and accurately detect pregnancy
in the early stages, helping doctors make faster treatment
decisions for women in emergency situations. In addition, Abbott
launched its wireless i-STAT handheld system in Europe, which
enables faster decision-making for doctors and enhances workflow by
transmitting test results to patient medical records in
minutes.
Established Pharmaceuticals
($ in millions)
Note: Prior year financial results have been adjusted to exclude
the sales from the developed markets branded generics
pharmaceuticals business, which was sold to Mylan on Feb. 27, 2015.
Therefore, sales and growth rates shown in the following charts
represent continuing operations.
% Change vs. 2Q14
------------------------------------------------------------
Sales 2Q15 Int'l Total
-------------------------- ------------------------- -------------------------
U.S. Int'l Total U.S. Operational Reported Operational Reported
------- ------- ------- ------ ------------- ---------- ------------- ----------
Total -- 977 977 n/a 46.0 31.3 46.0 31.3
-------- ------- ------- ------ ------------- ---------- ------------- ----------
Key
Emerging
Markets -- 727 727 n/a 43.2 28.3 43.2 28.3
Other -- 250 250 n/a 54.8 40.5 54.8 40.5
% Change vs. 1H14
------------------------------------------------------------
Sales 1H15 Int'l Total
-------------------------- ------------------------- -------------------------
U.S. Int'l Total U.S. Operational Reported Operational Reported
------- ------- ------- ------ ------------- ---------- ------------- ----------
Total -- 1,874 1,874 n/a 44.5 31.5 44.5 31.5
-------- ------- ------- ------ ------------- ---------- ------------- ----------
Key
Emerging
Markets -- 1,380 1,380 n/a 43.9 29.9 43.9 29.9
Other -- 494 494 n/a 46.4 36.1 46.4 36.1
Established Pharmaceuticals sales increased 46.0 percent in the
second quarter on an operational basis and 31.3 percent on a
reported basis, including an unfavorable 14.7 percent effect of
foreign exchange. Excluding the impact of 2014 acquisitions and
foreign exchange, sales increased double digits in the quarter.
Key Emerging Markets include India, Russia, China, Brazil and
Colombia, along with several additional markets that represent the
most attractive long-term growth opportunities for Abbott's branded
generics product portfolio. Sales in these geographies increased
43.2 percent on an operational basis, driven by above-market growth
in India, China, and Colombia. Sales increased 28.3 percent on a
reported basis, including an unfavorable 14.9 percent effect of
foreign exchange.
In Latin America, sales increased double digits in the quarter
on an operational basis with and without the impact of the 2014
acquisition of CFR Pharmaceuticals, which broadened Abbott's
presence and product portfolio in the region.
Medical Devices
($ in millions)
% Change vs. 2Q14
-------------------------------------------------------------
Sales 2Q15 Int'l Total
----------------------- ------------------------- -------------------------
U.S
. Int'l Total U.S. Operational Reported Operational Reported
----- ------- ------- ------- ------------- ---------- ------------- ----------
Total 505 784 1,289 3.0 3.1 (11.2) 3.1 (6.1)
----- ------- ------- ------- ------------- ---------- ------------- ----------
Vascular 298 424 722 6.0 1.5 (12.4) 3.2 (5.6)
Diabetes Care 93 185 278 (4.3) 10.1 (5.8) 5.3 (5.3)
Medical Optics 114 175 289 2.0 0.1 (13.4) 0.8 (8.0)
Vascular Product
Lines:
Coronary
Devices(a) 195 363 558 6.9 0.9 (12.8) 2.7 (6.8)
Endovascular(b) 70 62 132 3.8 5.4 (9.9) 4.6 (3.1)
(a) Includes DES / BVS product portfolio, structural heart, guidewires, balloon catheters,
and other coronary products.
(b) Includes vessel closure, carotid stents and other peripheral products.
% Change vs. 1H14
-------------------------------------------------------------
Sales 1H15 Int'l Total
----------------------- ------------------------- -------------------------
U.S
. Int'l Total U.S. Operational Reported Operational Reported
----- ------- ------- ------- ------------- ---------- ------------- ----------
Total 990 1,525 2,515 3.3 1.4 (11.7) 2.1 (6.3)
----- ------- ------- ------- ------------- ---------- ------------- ----------
Vascular 581 839 1,420 6.3 0.5 (12.3) 2.6 (5.5)
Diabetes Care 195 350 545 0.3 6.0 (8.3) 4.1 (5.4)
Medical Optics 214 336 550 (1.5) (1.0) (13.4) (1.2) (9.2)
Vascular Product
Lines:
Coronary
Devices(a) 380 719 1,099 5.4 (0.4) (13.0) 1.4 (7.4)
Endovascular(b) 137 120 257 8.0 6.1 (8.3) 7.0 (0.2)
(a) Includes DES / BVS product portfolio, structural heart, guidewires, balloon catheters,
and other coronary products.
(b) Includes vessel closure, carotid stents and other peripheral products.
Worldwide Medical Devices sales increased 3.1 percent in the
second quarter on an operational basis and decreased 6.1 percent on
a reported basis, including an unfavorable 9.2 percent effect of
foreign exchange.
Worldwide sales of Vascular products increased 3.2 percent in
the quarter on an operational basis and decreased 5.6 percent on a
reported basis, including an unfavorable 8.8 percent effect of
foreign exchange. Sales of Abbott's MitraClip(R) structural heart
device for the treatment of mitral regurgitation increased double
digits globally, including strong momentum in the U.S. as Abbott
continues to build and shape the market for this first-in-class
device. Abbott recently received European approval for Absorb GT1,
which combines the Absorb bioresorbable vascular scaffold with a
next-generation delivery catheter. Abbott also completed
submissions for regulatory approval of Absorb in Japan and the
U.S., and expects to submit for regulatory approval in China in the
coming months.
Worldwide Diabetes Care sales increased 5.3 percent in the
quarter on an operational basis and decreased 5.3 percent on a
reported basis, including an unfavorable 10.6 percent effect of
foreign exchange. International sales growth was driven by
continued uptake of Abbott's revolutionary new FreeStyle Libre
Flash Glucose Monitoring System. In the quarter, Abbott submitted
FreeStyle Libre Pro, its professional-use version of FreeStyle
Libre, for regulatory approval in the U.S. FreeStyle Libre Pro
incorporates the same sensor-based technology as FreeStyle Libre
and has the potential to change how healthcare providers manage
diabetic patients.
Worldwide Medical Optics sales increased 0.8 percent in the
quarter on an operational basis and decreased 8.0 percent on a
reported basis, including an unfavorable 8.8 percent effect of
foreign exchange. Sales growth in the quarter was impacted by
market dynamics in the cataract and refractive businesses. Abbott
expects improved sales growth over the rest of the year as it
continues to drive adoption of recently launched products.
ABBOTT'S FULL-YEAR 2015 EARNINGS-PER-SHARE GUIDANCE RANGE
REMAINS UNCHANGED
Abbott's full-year 2015 guidance range for earnings per share
from continuing operations, excluding specified items, remains
unchanged at $2.10 to $2.20, representing strong growth at the
mid-point of the guidance range.
Abbott forecasts net specified items related to continuing
operations for the full year 2015 of approximately $0.60 per share.
Specified items include intangible amortization expense, charges
associated with cost reduction initiatives, and expenses related to
acquisitions, partially offset by a gain on the sale of a portion
of Abbott's position in Mylan stock.
Including net specified items, projected earnings per share from
continuing operations under U.S. Generally Accepted Accounting
Principles (GAAP) would be $1.50 to $1.60 for the full year
2015.
ABBOTT DECLARES 366(TH) CONSECUTIVE QUARTERLY DIVIDEND
On June 12, 2015, the board of directors of Abbott declared the
company's quarterly dividend of $0.24 per share. Abbott's cash
dividend is payable on Aug. 15, 2015, to shareholders of record at
the close of business on July 15, 2015.
Abbott is a member of the S&P 500 Dividend Aristocrats
Index, which tracks companies that have annually increased their
dividend for 25 consecutive years.
About Abbott:
Abbott is a global healthcare company devoted to improving life
through the development of products and technologies that span the
breadth of healthcare. With a portfolio of leading, science-based
offerings in diagnostics, medical devices, nutritionals and branded
generic pharmaceuticals, Abbott serves people in more than 150
countries and employs approximately 73,000 people.
Visit Abbott at www.abbott.com and connect with us on Twitter at
@AbbottNews.
Abbott will webcast its live second-quarter earnings conference
call through its Investor Relations website at
www.abbottinvestor.com at 8 a.m. Central time today. An archived
edition of the call will be available after 11 a.m. Central
time.
- Private Securities Litigation Reform Act of 1995 -
A Caution Concerning Forward-Looking Statements
Some statements in this news release may be forward-looking
statements for purposes of the Private Securities Litigation Reform
Act of 1995. Abbott cautions that these forward-looking statements
are subject to risks and uncertainties that may cause actual
results to differ materially from those indicated in the
forward-looking statements. Economic, competitive, governmental,
technological and other factors that may affect Abbott's operations
are discussed in Item 1A, "Risk Factors," to our Annual Report on
Securities and Exchange Commission Form 10-K for the year ended
Dec. 31, 2014, and are incorporated by reference. Abbott undertakes
no obligation to release publicly any revisions to forward-looking
statements as a result of subsequent events or developments, except
as required by law.
Abbott Laboratories and Subsidiaries
Consolidated Statement of Earnings
Second Quarter Ended June 30, 2015 and 2014
(in millions, except per share data)
(unaudited)
2Q15 2Q14 % Change
-------- ---------- ----------
Net Sales $5,170 $5,057 2.2
Cost of products sold, excluding amortization expense 2,218 2,288 (3.0)
Amortization of intangible assets 151 133 13.6
Research and development 345 310 11.1
Selling, general, and administrative 1,727 1,649 4.8
Total Operating Cost and Expenses 4,441 4,380 1.4
-------- ----------
Operating earnings 729 677 7.5
Interest expense, net 17 17 2.7
Net foreign exchange (gain) loss 5 -- n/m
Other (income) expense, net (279) 2 n/m 1)
Earnings from Continuing Operations before taxes 986 658 49.8
Taxes on Earnings from Continuing Operations 200 233 (14.5)
Earnings from Continuing Operations 786 425 85.1
Earnings (loss) from Discontinued Operations, net of taxes (2) 41 n/m 2)
-------- ----------
Net Earnings $784 $466 68.3
======== ==========
Net Earnings from Continuing Operations, excluding
Specified Items, as described below $786 $741 6.1 3)
======== ==========
Diluted Earnings per Common Share from:
Continuing Operations $0.52 $0.28 85.7
Discontinued Operations -- 0.02 (100.0) 2)
Total $0.52 $0.30 73.3
======== ==========
Diluted Earnings per Common Share from Continuing
Operations, excluding Specified Items, as described below $0.52 $0.49 6.1 3)
======== ==========
Average Number of Common Shares Outstanding
Plus Dilutive Common Stock Options 1,504 1,517
NOTES:
See tables below for an explanation of certain non-GAAP financial information.
n/m = Percent change is not meaningful.
See footnotes below.
1) 2015 Other (income) expense includes a gain on the sale of a portion of Abbott's position
in Mylan stock and a decrease in the fair value of contingent consideration related to a business
acquisition, both reported as specified items.
2) 2014 Earnings and Diluted Earnings per Common Share from Discontinued Operations reflect financial
results from the developed markets branded generics pharmaceuticals and animal health businesses,
and favorable adjustments to tax expense as a result of the resolution of various tax positions
from previous years related to AbbVie operations.
3) 2015 Net Earnings from Continuing Operations, excluding Specified Items, excludes net after-tax
charges of less than $1 million as intangible amortization expense, expenses associated with
cost reduction initiatives and expenses related to acquisitions were offset by a gain on the
sale of a portion of Abbott's position in Mylan stock and a decrease in the fair value of
contingent consideration related to a business acquisition.
2014 Net Earnings from Continuing Operations, excluding Specified Items, excludes net after-tax
charges of $316 million, or $0.21 per share, for intangible amortization expense, expenses
associated with cost reduction initiatives and tax expense associated with a one-time repatriation
of 2014 ex-U.S. earnings.
Abbott Laboratories and Subsidiaries
Consolidated Statement of Earnings
First Half Ended June 30, 2015 and 2014
(in millions, except per share data)
(unaudited)
1H15 1H14 % Change
---------- -------- ----------
Net Sales $10,067 $9,812 2.6
Cost of products sold, excluding amortization expense 4,299 4,562 (5.8)
Amortization of intangible assets 307 260 18.2
Research and development 658 679 (3.0)
Selling, general, and administrative 3,464 3,269 6.0
Total Operating Cost and Expenses 8,728 8,770 (0.5)
---------- --------
Operating earnings 1,339 1,042 28.4
Interest expense, net 33 37 (10.5)
Net foreign exchange (gain) loss (49) 1 n/m
Other (income) expense, net (284) 5 n/m 1)
---------- --------
Earnings from Continuing Operations before taxes 1,639 999 63.9
Taxes on Earnings from Continuing Operations 324 350 (7.7)
Earnings from Continuing Operations 1,315 649 102.5
Earnings from Discontinued Operations, net of taxes 25 192 (87.1)
Gain on Sale of Discontinued Operations, net of taxes 1,736 -- n/m
---------- --------
Net Earnings from Discontinued Operations, net of taxes 1,761 192 n/m 2)
---------- --------
Net Earnings $3,076 $841 n/m
========== ========
Net Earnings from Continuing Operations, excluding
Specified Items, as described below $1,505 $1,276 17.9 3)
========== ========
Diluted Earnings per Common Share from:
Continuing Operations $0.87 $0.42 107.1
Discontinued Operations 1.16 0.13 n/m 2)
Total $2.03 $0.55 n/m
========== ========
Diluted Earnings per Common Share from Continuing
Operations, excluding Specified Items, as described below $0.99 $0.83 19.3 3)
========== ========
Average Number of Common Shares Outstanding
Plus Dilutive Common Stock Options 1,511 1,532
NOTES:
See tables below for an explanation of certain non-GAAP financial information.
n/m = Percent change is not meaningful.
See footnotes below.
1) 2015 Other (income) expense includes a gain on the sale of a portion of Abbott's position
in Mylan stock and a decrease in the fair value of contingent consideration related to a business
acquisition, both reported as specified items.
2) 2015 Earnings and Diluted Earnings per Common Share from Discontinued Operations reflect the
after-tax gain of $1.736 billion on the sale of the developed markets branded generics pharmaceuticals
and animal health businesses to Mylan on Feb. 27, 2015 and Zoetis on Feb. 10, 2015, respectively;
the first-quarter financial results from these businesses up to the date of sale; and a favorable
adjustment to tax expense as a result of the resolution of various tax positions from previous
years related to AbbVie operations.
2014 Earnings and Diluted Earnings per Common Share from Discontinued Operations reflect financial
results from the developed markets branded generics pharmaceuticals and animal health businesses,
and favorable adjustments to tax expense as a result of the resolution of various tax positions
from previous years related to AbbVie operations and the developed markets branded generics
pharmaceuticals business.
3) 2015 Net Earnings from Continuing Operations, excluding Specified Items, excludes net after-tax
charges of $190 million, or $0.12 per share, for intangible amortization expense, expenses
associated with cost reduction initiatives and expenses related to acquisitions, partially
offset by a gain on the sale of a portion of Abbott's position in Mylan stock and a decrease
in the fair value of contingent consideration related to a business acquisition.
2014 Net Earnings from Continuing Operations, excluding Specified Items, excludes net after-tax
charges of $627 million, or $0.41 per share, for intangible amortization expense, expenses
associated with cost reduction initiatives and tax expense associated with a one-time repatriation
of 2014 ex-U.S. earnings.
NON-GAAP RECONCILIATION OF FINANCIAL INFORMATION FROM CONTINUING OPERATIONS
Abbott Laboratories and Subsidiaries
Non-GAAP Reconciliation of Financial Information From Continuing Operations
Second Quarter Ended June 30, 2015 and 2014
(in millions, except per share data)
(unaudited)
2Q15
-----------------------------------------------
As
Reported Specified As % to
(GAAP) Items Adjusted Sales
----------- ----------- ----------- --------
Intangible Amortization $151 ($151) --
Gross Margin 2,801 185 $2,986 57.8%
R&D 345 (20) 325 6.3%
SG&A 1,727 (67) 1,660 32.1%
Other (Income) Expense, Net (279) 287 8
Earnings from Continuing Operations before taxes 986 (15) 971
Taxes on Earnings from Continuing Operations 200 (15) 185
Net Earnings from Continuing Operations 786 -- 786
Diluted Earnings per Share from Continuing Operations $0.52 -- $0.52
Specified items reflect intangible amortization expense of $151
million and other expenses of $121 million, primarily associated
with cost reduction initiatives and acquisitions, partially offset
by a gain on the sale of a portion of Abbott's position in Mylan
stock of $207 million and a decrease in the fair value of
contingent consideration related to a business acquisition.
2Q14
------------------------------------------------------------------------------------
Historical GAAP Specified As % to
Adj for Disc Ops1) Items Adjusted Sales
--------------------- -------------------- ---------------
Intangible
Amortization $133 ($133) --
Gross Margin 2,636 160 2,796 55.3%
R&D 310 (1) 309 6.1%
SG&A 1,649 (95) 1,554 30.7%
Other (Income)
Expense, Net 2 (2) --
Earnings from
Continuing
Operations before
taxes 658 258 916
Taxes on Earnings
from Continuing
Operations 233 (58) 175
Net Earnings from
Continuing
Operations 425 316 741
Diluted Earnings per
Share from
Continuing
Operations $0.28 $0.21 $0.49
1) Historical GAAP financial results, adjusted for the discontinued operations, as
previously
reported in Abbott's 8-K filing dated Jan. 27, 2015.
Specified items reflect intangible amortization expense of $133
million and other expenses, primarily associated with cost
reduction initiatives of $125 million, as well as tax expense of
$101 million associated with a one-time repatriation of 2014
ex-U.S. earnings.
Abbott Laboratories and Subsidiaries
Non-GAAP Reconciliation of Financial Information From Continuing Operations
First Half Ended June 30, 2015 and 2014
(in millions, except per share data)
(unaudited)
1H15
-----------------------------------------------
As
Reported Specified As % to
(GAAP) Items Adjusted Sales
----------- ----------- ----------- --------
Intangible Amortization $307 ($307) --
Gross Margin 5,461 371 $5,832 57.9%
R&D 658 (22) 636 6.3%
SG&A 3,464 (109) 3,355 33.3%
Other (Income) Expense, Net (284) 282 (2)
Earnings from Continuing Operations before taxes 1,639 220 1,859
Taxes on Earnings from Continuing Operations 324 30 354
Net Earnings from Continuing Operations 1,315 190 1,505
Diluted Earnings per Share from Continuing Operations $0.87 $0.12 $0.99
Specified items reflect intangible amortization expense of $307
million and other expenses of $200 million, primarily associated
with cost reduction initiatives and acquisitions, partially offset
by a gain on the sale of a portion of Abbott's position in Mylan
stock of $207 million and a decrease in the fair value of
contingent consideration related to a business acquisition.
1H14
-----------------------------------------------------------------------------------
Historical GAAP Specified As % to
Adj for Disc Ops1) Items Adjusted Sales
----------------------- -------------------- -------------------- --------------
Intangible
Amortization $260 ($260) --
Gross Margin 4,990 342 5,332 54.3%
R&D 679 (51) 628 6.4%
SG&A 3,269 (180) 3,089 31.5%
Other (Income)
Expense, Net 5 (4) 1
Earnings from
Continuing Operations
before taxes 999 577 1,576
Taxes on Earnings from
Continuing Operations 350 (50) 300
Net Earnings from
Continuing Operations 649 627 1,276
Diluted Earnings per
Share from Continuing
Operations $0.42 $0.41 $0.83
1) Historical GAAP financial results, adjusted for the discontinued operations, as
previously
reported in Abbott's 8-K filing dated Jan. 27, 2015.
Specified items reflect intangible amortization expense of $260
million and other expenses, primarily associated with cost
reduction initiatives of $317 million, as well as tax expense of
$154 million associated with a one-time repatriation of 2014
ex-U.S. earnings.
RECONCILIATION OF TAX RATE FOR CONTINUING OPERATIONS
A reconciliation of the second-quarter tax rates for continuing
operations for 2015 and 2014 is shown below:
2Q15
---------------------------------------------------------------------
Pre-Tax Taxes on Tax
($ in millions) Income Earnings Rate
---------------------- ---------------------- ---------------------
As reported (GAAP) $986 $200 20.2%
Specified items (15) (15)
---------------------- ----------------------
Excluding specified
items $971 $185 19.0%
2Q14
---------------------------------------------------------------------
Pre-Tax Taxes on Tax
($ in millions) Income Earnings Rate
---------------------- ---------------------- ---------------------
As reported (GAAP) $658 $233 35.4% 1)
Specified items 258 (58)
---------------------- ----------------------
Excluding specified
items $916 $175 19.0%
1) Reported tax rate on a GAAP basis includes the impact of tax expense of $101
million associated
with a one-time repatriation of 2014 ex-U.S. earnings.
A reconciliation of the year-to-date tax rates for continuing
operations for 2015 and 2014 is shown below:
1H15
---------------------------------------------------------------------
Pre-Tax Taxes on Tax
($ in millions) Income Earnings Rate
---------------------- ---------------------- ---------------------
As reported (GAAP) $1,639 $324 19.7%
Specified items 220 30
---------------------- ----------------------
Excluding specified
items $1,859 $354 19.0%
1H14
---------------------------------------------------------------------
Pre-Tax Taxes on Tax
($ in millions) Income Earnings Rate
---------------------- ---------------------- ---------------------
As reported (GAAP) $999 $350 35.0% 2)
Specified items 577 (50)
---------------------- ----------------------
Excluding specified
items $1,576 $300 19.0%
2) Reported tax rate on a GAAP basis includes the impact of tax expense of $154
million associated
with a one-time repatriation of 2014 ex-U.S. earnings.
Photo -
http://photos.prnewswire.com/prnh/20150721/239121-INFO
CONTACT: Abbott Financial: Scott Leinenweber, (224) 668-0791,
Michael Comilla, (224) 668-1872, Jeffrey Byrne, (224) 668-8808,
Abbott Media: Scott Stoffel, (224) 668-5201, Elissa Maurer, (224)
668-3309
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR GMGZNZZKGKZM
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