-- Provides Sales and Earnings Projections for 2010 -- LAKE FOREST,
Ill., Feb. 4 /PRNewswire-FirstCall/ -- Hospira, Inc. (NYSE: HSP), a
leading global specialty pharmaceutical and medication delivery
company, today reported results for the fourth quarter and full
year ended Dec. 31, 2009. For the fourth quarter of 2009, net sales
were $1.1 billion, and adjusted* diluted earnings per share were
$0.87. For the full year of 2009, net sales were $3.9 billion, and
adjusted* diluted earnings per share were $3.11. (Adjusted*
measures exclude certain specified items as described later in this
press release and the attached schedules.) "Driven by double-digit
revenue and adjusted earnings growth, the fourth quarter concluded
a year of transformation for Hospira. In addition to our strong
financial performance, we made significant progress on many fronts,
including augmenting our biogenerics program, launching a generic
version of a blockbuster oncology drug, and advancing Project Fuel,
our corporate-wide optimization initiative," said Christopher B.
Begley, chairman and chief executive officer. "Looking forward, we
expect 2010 to be another good year of growth for Hospira. Backed
by our commitment to strong execution and focus on sustained
operational improvement, we continue to position Hospira for
sustainable, long-term growth and increased shareholder value."
Fourth-Quarter 2009 Results The following table highlights selected
financial results for the fourth quarter of 2009 compared to the
same period in 2008: In $ millions, GAAP Adjusted* except per Three
Months Ended Three Months Ended share amounts Dec. 31, Dec. 31,
------------------ % ------------------ % 2009 2008 Change 2009
2008 Change -------- ------ ------ -------- ------- ------ Net
Sales $1,055.2 $913.7 15.5% n/a n/a n/a Gross Profit (Net Sales
less Cost of Products Sold) $395.0 $356.7 10.7% $427.5 $376.4 13.6%
Income from Operations $135.6 $155.7 (12.9%) $204.2 $188.2 8.5%
Diluted EPS $0.58 $0.65 (10.8%) $0.87 $0.78 11.5% Statistics (as a
% of Net Sales) -------------------------------- Gross Profit (Net
Sales less Cost of Products Sold) 37.4% 39.0% 40.5% 41.2% Income
from Operations 12.9% 17.0% 19.4% 20.6% Results under U.S.
Generally Accepted Accounting Principles (GAAP) include items as
detailed in the schedules attached to this press release. Net sales
increased 15.5 percent to $1.1 billion in the fourth quarter of
2009, compared to $914 million in the fourth quarter of 2008. The
growth was driven mainly by an increase in Specialty Injectable
Pharmaceuticals, primarily a result of the third-quarter 2009
launch of the generic chemotherapy agent oxaliplatin in solution
form in the United States and strength in our proprietary sedation
agent, Precedex(TM). Adjusted* income from operations increased 8.5
percent to $204 million in the fourth quarter of 2009, compared to
$188 million in the fourth quarter of 2008. Driving the majority of
the increase were higher net sales, more favorable product mix and
improvements resulting from the company's Project Fuel optimization
initiatives. Full-Year 2009 Results The following table highlights
selected financial results for the full-year 2009 compared to the
same period in 2008: In $ millions, GAAP Adjusted* except per Year
Ended Year Ended share amounts Dec. 31, Dec. 31, ------------------
% ------------------ % 2009 2008 Change 2009 2008 Change --------
-------- ------ -------- -------- ------ Net Sales $3,879.3
$3,629.5 6.9% n/a n/a n/a Gross Profit (Net Sales less Cost of
Products Sold) $1,456.4 $1,342.7 8.5% $1,551.3 $1,426.5 8.7% Income
from Operations $502.9 $517.8 (2.9%) $738.0 $647.1 14.0% Diluted
EPS $2.47 $1.99 24.1% $3.11 $2.53 22.9% Statistics (as a % of Net
Sales) -------------------------------- Gross Profit (Net Sales
less Cost of Products Sold) 37.5% 37.0% 40.0% 39.3% Income from
Operations 13.0% 14.3% 19.0% 17.8% Net sales increased 6.9 percent
to $3.9 billion for the year ended Dec. 31, 2009, compared to $3.6
billion for the prior year. The growth was driven mainly by
Specialty Injectable Pharmaceuticals, with strong growth from the
U.S. launch of oxaliplatin and strength in Precedex. Adjusted*
income from operations increased 14.0 percent to $738 million for
the full year of 2009, compared to $647 million for the full year
of 2008. Higher net sales volume and increased manufacturing
efficiency, including the impact of Project Fuel optimization
initiatives, were the major drivers of the full-year operating
income performance. Partially offsetting these factors were the
impact of costs associated with certain product corrective actions,
as well as foreign exchange rate fluctuations. Cash Flow Cash flow
from operations for the full-year 2009 was $945 million, compared
to the $584 million generated in 2008. The increase reflects
stronger income from operations and favorable changes in working
capital, which were primarily associated with the timing of the
payment of rebate and chargeback accruals related to 2009 sales of
oxaliplatin. Capital expenditures were $159 million for the full
year, compared to $164 million in 2008. The decline was partly due
to lower spending in 2009 than in 2008 related to the company's
facilities optimization initiatives. 2010 Projections Hospira
expects net sales growth for full-year 2010 to be approximately 6
to 8 percent on a constant-currency basis, excluding the projected
year-over-year impact of oxaliplatin sales and business disposals.
Including the impact of these items and foreign exchange, the
company expects net sales to be flat to slightly up. Adjusted*
diluted earnings per share for 2010 are expected to be in the range
of $3.25 to $3.35. The reconciliation between the projected 2010
adjusted* diluted earnings per share and GAAP diluted earnings per
share follows: Diluted earnings per share -- adjusted* $3.25 -
$3.35 ------------- Estimated charges related to Project Fuel
initiatives (mid-point of an estimated range of $0.28 to $0.32 per
diluted share) ($0.30) Estimated charges related to facilities
optimization initiatives (mid-point of an estimated range of $0.04
to $0.06 per diluted share) ($0.05) Estimated $58 million for the
amortization of intangibles related to the Mayne Pharma acquisition
($0.24) ------------- Diluted earnings per share -- GAAP $2.66 -
$2.76 ============= The estimated charges are shown net of tax of
$51 million, which is calculated for the individual components of
the provided ranges based on the statutory tax rate in the various
tax jurisdictions in which the adjustments are expected to occur.
The company projects that cash flow from operations in 2010 will be
in the $600 million to $650 million range. The year-over-year
decrease in cash flow from operations includes the projected effect
of timing related to rebate and chargeback payments associated with
2009 sales of oxaliplatin. Depreciation and amortization is
expected to be between $235 million and $245 million. Capital
expenditures are projected to be between $195 million and $215
million, primarily related to Information Technology projects
associated with the company's Project Fuel initiatives. "The
significant momentum we generated in 2009 has paved the way for
continued progress in 2010," said Begley. "With our robust product
pipeline, anticipated advancements in both Specialty Injectable
Pharmaceuticals and Medication Management Systems, combined with
our focus on operational optimization through Project Fuel, Hospira
is on track for another good year." *Use of Non-GAAP Financial
Measures Non-GAAP financial measures used in this press release are
reconciled to the most comparable measures calculated in accordance
with GAAP in the schedules attached to this release. For more
information regarding these non-GAAP financial measures, please see
Hospira's Current Report on Form 8-K furnished to the Securities
and Exchange Commission on the date of this press release. Webcast
/ Complementary Material Hospira will hold a conference call for
investors and media at 8 a.m. Central time on Thursday, Feb. 4,
2010. A live webcast of the conference call will be available on
Hospira's Web site at http://www.hospirainvestor.com/. Listeners
should log on approximately 10 minutes in advance to ensure proper
setup for receiving the webcast. In addition, complementary
information will be available on the presentations page of the
Investor Relations Web site at the beginning of the conference
call. A replay will be available on the Hospira Web site for 30
days following the call. About Hospira Hospira, Inc. is a global
specialty pharmaceutical and medication delivery company dedicated
to Advancing Wellness(TM). As the world leader in specialty generic
injectable pharmaceuticals, Hospira offers one of the broadest
portfolios of generic acute-care and oncology injectables, as well
as integrated infusion therapy and medication management solutions.
Through its products, Hospira helps improve the safety, cost and
productivity of patient care. The company is headquartered in Lake
Forest, Ill., and has approximately 13,500 employees. Learn more at
http://www.hospira.com/. Private Securities Litigation Reform Act
of 1995 -- A Caution Concerning Forward-Looking Statements This
press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including projections of certain measures of Hospira's results of
operations, projections of certain charges and expenses, and other
statements regarding Hospira's goals and strategy. Hospira 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, legal, technological and other factors
that may affect Hospira's operations and may cause actual results
to be materially different from expectations include the risks,
uncertainties and factors discussed under the headings "Risk
Factors" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in Hospira's latest Annual
Report on Form 10-K and subsequent Forms 10-Q, filed with the
Securities and Exchange Commission, which are incorporated by
reference. Hospira undertakes no obligation to release publicly any
revisions to forward-looking statements as the result of subsequent
events or developments. Hospira, Inc. Condensed Consolidated
Statements of Income (Unaudited) (dollars and shares in millions,
except for per share amounts) Three Months Ended December 31,
---------------- % 2009 2008 Change -------- ------ ------- Net
sales $1,055.2 $913.7 15.5 % -------- ------ Cost of products sold
660.2 557.0 18.5 % Restructuring and impairment 15.1 8.6 75.6 %
Research and development 79.7 53.0 50.4 % Selling, general and
administrative 164.6 139.4 18.1 % -------- ------ Total operating
costs and expenses 919.6 758.0 21.3 % -------- ------ Income From
Operations 135.6 155.7 (12.9)% Interest expense 26.1 29.0 (10.0)%
Other (income) expense, net (2.5) 0.6 (516.7)% -------- ------
Income Before Income Taxes 112.0 126.1 (11.2)% Income tax expense
15.3 21.5 (28.8)% -------- ------ Net Income $96.7 $104.6 (7.6)%
======== ====== Earnings Per Common Share: Basic $0.59 $0.66
(10.6)% ======== ====== Diluted $0.58 $0.65 (10.8)% ======== ======
Weighted Average Common Shares Outstanding: Basic 162.6 159.5 1.9 %
======== ====== Diluted 165.9 160.9 3.1 % ======== ====== Adjusted
Gross Profit (1)(2) $427.5 $376.4 13.6 % Adjusted Income From
Operations (1) $204.2 $188.2 8.5 % Adjusted Net Income (1) $144.6
$126.3 14.5 % Adjusted Diluted Earnings Per Share (1) $0.87 $0.78
11.5 % Statistics (as a % of net sales, except for income tax
rate): GAAP Adjusted (1) Three Months Ended Three Months Ended
December 31, December 31, ------------------ ------------------
2009 2008 2009 2008 -------- -------- -------- ------- Gross Profit
(2) 37.4 % 39.0 % 40.5 % 41.2 % Income From Operations 12.9 % 17.0
% 19.4 % 20.6 % Net Income 9.2 % 11.4 % 13.7 % 13.8 % Income Tax
Rate 13.7 % 17.1 % 19.9 % 20.4 % (1) Adjusted financial measures
exclude certain specified items as described and reconciled to
comparable GAAP financial measures in the Reconciliation of GAAP to
Non-GAAP Financial Measures schedule. (2) Gross profit is defined
as Net sales less Cost of products sold. Adjusted gross profit
excludes certain specified items, as indicated in the previous
footnote. Hospira, Inc. Condensed Consolidated Statements of Income
(Unaudited) (dollars and shares in millions, except for per share
amounts) Years Ended December 31, ------------------ % 2009 2008
Change -------- -------- -------- Net sales $3,879.3 $3,629.5 6.9 %
-------- -------- Cost of products sold 2,422.9 2,286.8 6.0 %
Restructuring and impairment 94.2 22.4 320.5 % Research and
development 240.5 211.9 13.5 % Acquired in-process research and
development - 0.5 (100.0)% Selling, general and administrative
618.8 590.1 4.9 % -------- -------- Total operating costs and
expenses 3,376.4 3,111.7 8.5 % -------- -------- Income From
Operations 502.9 517.8 (2.9)% Interest expense 106.3 116.2 (8.5)%
Other expense (income), net 11.8 (5.9) (300.0)% -------- --------
Income Before Income Taxes 384.8 407.5 (5.6)% Income tax (benefit)
expense (19.1) 86.6 (122.1)% -------- -------- Net Income $403.9
$320.9 25.9 % ======== ======== Earnings Per Common Share: Basic
$2.51 $2.02 24.3 % ======== ======== Diluted $2.47 $1.99 24.1 %
======== ======== Weighted Average Common Shares Outstanding: Basic
161.0 159.2 1.1 % ======== ======== Diluted 163.2 161.3 1.2 %
======== ======== Adjusted Gross Profit (1)(2) $1,551.3 $1,426.5
8.7 % Adjusted Income From Operations (1) $738.0 $647.1 14.0 %
Adjusted Net Income (1) $507.0 $408.1 24.2 % Adjusted Diluted
Earnings Per Share (1) $3.11 $2.53 22.9 % Statistics (as a % of net
sales, except for income tax rate): GAAP Adjusted (1) Years Ended
Years Ended December 31, December 31, ------------------
------------------ 2009 2008 2009 2008 -------- -------- --------
------- Gross Profit (2) 37.5 % 37.0 % 40.0 % 39.3 % Income From
Operations 13.0 % 14.3 % 19.0 % 17.8 % Net Income 10.4 % 8.8 % 13.1
% 11.2 % Income Tax Rate (5.0)% 21.3 % 20.3 % 24.0 % (1) Adjusted
financial measures exclude certain specified items as described and
reconciled to comparable GAAP financial measures in the
Reconciliation of GAAP to Non-GAAP Financial Measures. (2) Gross
profit is defined as Net sales less Cost of products sold. Adjusted
gross profit excludes certain specified items, as indicated in the
previous footnote. Hospira, Inc. Reconciliation of GAAP to Non-GAAP
Financial Measures (Unaudited) (dollars and shares in millions,
except for per share amounts) Three months ended December 31, 2009
Reconciliation of GAAP to Non-GAAP Financial Measures:
------------------------------------------------------------------------
Income Gross From Net Diluted Profit(1) Operations Income(2) EPS
-------- ---------- -------- ------- GAAP financial measures $395.0
$135.6 $96.7 $0.58 Specified items: Project Fuel and related
impairment charges(A) 13.8 31.0 19.7 0.12 Facilities Optimization
charges (B) 5.4 8.3 5.4 0.03 Amortization of Mayne Pharma
intangible assets (C) 13.3 13.3 11.4 0.07 Research and development
charges (D) - 16.0 11.4 0.07 -------- ---------- -------- -------
Adjusted financial measures (3) $427.5 $204.2 $144.6 $0.87 ========
========== ======== ======= GAAP results for the three months ended
December 31, 2009 include: A -- Project Fuel and related impairment
charges: $13.8 million reported in Cost of products sold, $12.2
million reported in Restructuring and impairment, $0.7 million
reported in Research and development and $4.3 million reported in
Selling, general and administrative. Project Fuel initiatives
include costs for severance and other employee benefits, process
optimization implementation, exit costs and other asset charges.
Impairment charges relate to non-strategic businesses and
underlying assets committed for disposal including related property
and equipment. B -- Facilities Optimization charges: $5.4 million
reported in Cost of products sold and $2.9 million reported in
Restructuring and impairment. These charges relate to facilities
optimization from the closure or departure from certain
manufacturing and research and development ("R&D") facilities
and include costs for severance and other employee benefits,
accelerated depreciation and relocation of production and R&D
operations. C -- Amortization of Mayne Pharma Limited ("Mayne
Pharma") intangible assets resulting from the Mayne Pharma
acquisition is reported in Cost of products sold. D -- Research and
development charges resulting from an initial payment related to an
agreement and corresponding milestones reached for development of
an oncology product that has not yet achieved regulatory approval.
Three months ended December 31, 2008 Reconciliation of GAAP to
Non-GAAP Financial Measures:
------------------------------------------------------------------------
Income Gross From Net Diluted Profit(1) Operations Income(2) EPS
-------- ---------- -------- ------- GAAP financial measures $356.7
$155.7 $104.6 $0.65 Specified items: Facilities Optimization
charges (A) 0.9 9.5 6.1 0.04 Amortization of Mayne Pharma
intangible assets (B) 16.0 16.0 10.9 0.06 Integration-related
charges (C) 2.8 7.0 4.7 0.03 -------- ---------- -------- -------
Adjusted financial measures (3) $376.4 $188.2 $126.3 $0.78 ========
========== ======== ======= GAAP results for the three months ended
December 31, 2008 include: A -- Facilities Optimization charges:
$0.9 million reported in Cost of products sold and $8.6 million
reported in Restructuring and impairment. B -- Amortization of
Mayne Pharma intangible assets is reported in Cost of products
sold. C -- Integration-related charges: $2.8 million reported in
Cost of products sold and $4.2 million reported in Selling, general
and administrative. These charges relate to the integration of
Mayne Pharma and other acquisitions into our operations and include
costs for closure of facilities, termination of lease agreements,
severance and other employee benefit costs. (1) Gross profit is
defined as Net sales less Cost of products sold. (2) Adjusted Net
Income is shown net of tax of $36.0 million and $32.3 million for
the three months ended December 31, 2009 and 2008, respectively,
based on the statutory tax rate in the various tax jurisdictions in
which the adjustments occurred. (3) The Non-GAAP financial measures
contained in this press release (including adjusted gross profit,
adjusted income from operations, adjusted net income and adjusted
diluted Earnings Per Share) adjust for certain specified items. All
Non-GAAP financial measures are intended to supplement the
applicable GAAP measures and should not be considered in isolation
from, or a replacement for, financial measures prepared in
accordance with GAAP. Refer to Hospira's filing on Form 8-K filed
on February 4, 2010 for additional information. Hospira, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)
(dollars and shares in millions, except for per share amounts) Year
ended December 31, 2009 Reconciliation of GAAP to Non-GAAP
Financial Measures:
--------------------------------------------------------------------------
Income Gross From Net Diluted Profit(1) Operations Income(2) EPS
-------- ---------- -------- ------- GAAP financial measures
$1,456.4 $502.9 $403.9 $2.47 Specified items: Project Fuel and
related impairment charges(A) 26.4 136.5 111.2 0.69 Facilities
Optimization charges (B) 14.3 28.4 18.8 0.12 Amortization of Mayne
Pharma intangible assets (C) 54.2 54.2 37.3 0.23 Research and
development charges (D) - 16.0 11.1 0.07 Impairment of marketable
equity securities (E) - - 16.6 0.10 Resolution of IRS tax audit
benefit (F) - - (91.9) (0.57) -------- ---------- -------- -------
Adjusted financial measures (3) $1,551.3 $738.0 $507.0 $3.11
======== ========== ======== ======= GAAP results for the year
ended December 31, 2009 include: A -- Project Fuel and related
impairment charges: $26.4 million reported in Cost of products
sold, $80.1 million reported in Restructuring and impairment, $3.3
million reported in Research and development and $26.7 million
reported in Selling, general and administrative. Project Fuel
initiatives include costs for severance and other employee
benefits, process optimization implementation, exit costs and other
asset charges. Impairment charges relate to non-strategic
businesses and underlying assets committed for disposal including
related property and equipment, allocated goodwill and intangible
assets. B -- Facilities Optimization charges: $14.3 million
reported in Cost of products sold and $14.1 million reported in
Restructuring and impairment. These charges relate to facilities
optimization from the closure or departure from certain
manufacturing and research and development ("R&D") facilities
and include costs for severance and other employee benefits,
accelerated depreciation and relocation of production and R&D
operations. C -- Amortization of Mayne Pharma Limited ("Mayne
Pharma") intangible assets resulting from the Mayne Pharma
acquisition is reported in Cost of products sold. D -- Research and
development charges resulting from an initial payment related to an
agreement and corresponding milestones reached for development of
an oncology product that has not yet achieved regulatory approval.
E -- Impairment of marketable equity securities is reported in
Other expense (income), net. F -- Resolution of IRS tax audit
benefit of $91.9 million reported in Income tax (benefit) expense.
This discrete income tax benefit is related to the completion and
effective settlement of U.S. tax return audits. Year ended December
31, 2008 Reconciliation of GAAP to Non-GAAP Financial Measures:
--------------------------------------------------------------------------
Income Gross From Net Diluted Profit(1) Operations Income(2) EPS
-------- ---------- -------- ------- GAAP financial measures
$1,342.7 $517.8 $320.9 $1.99 Specified items: Facilities
Optimization charges (A) 12.4 35.4 22.1 0.14 Amortization of Mayne
Pharma intangible assets (B) 62.8 62.8 42.3 0.26
Integration-related charges (C) 8.6 30.6 22.3 0.14 Acquired
in-process research and development - 0.5 0.5 - -------- ----------
-------- ------- Adjusted financial measures (3) $1,426.5 $647.1
$408.1 $2.53 ======== ========== ======== ======= GAAP results for
the year ended December 31, 2008 include: A -- Facilities
Optimization charges: $12.4 million reported in Cost of products
sold, $22.4 million reported in Restructuring and impairments and
$0.6 million reported in R&D. B -- Amortization of Mayne Pharma
intangible assets is reported in Cost of products sold. C --
Integration-related charges: $8.6 million reported in Cost of
products sold, $1.0 million reported in R&D and $21.0 million
reported in Selling, general and administrative. These charges
relate to the integration of Mayne Pharma and other acquisitions
into our operations and include costs for closure of facilities,
termination of lease agreements, severance and other employee
benefit costs. (1) Gross profit is defined as Net sales less Cost
of products sold. (2) Adjusted Net Income is shown net of tax of
$129.5 million and $128.7 million for the years ended December 31,
2009 and 2008, respectively, based on the statutory tax rate in the
various tax jurisdictions in which the adjustments occurred. (3)
The Non-GAAP financial measures contained in this press release
(including adjusted gross profit, adjusted income from operations,
adjusted net income and adjusted diluted Earnings Per Share) adjust
for certain specified items. All Non-GAAP financial measures are
intended to supplement the applicable GAAP measures and should not
be considered in isolation from, or a replacement for, financial
measures prepared in accordance with GAAP. Refer to Hospira's
filing on Form 8-K filed on February 4, 2010 for additional
information. Hospira, Inc. Condensed Consolidated Balance Sheets
(Unaudited) (dollars in millions) December 31, December 31, Assets
2009 2008 -------- -------- Current Assets: Cash and cash
equivalents $946.0 $483.8 Trade receivables, less allowances of
$6.2 in 2009 and $6.7 in 2008 498.1 583.4 Inventories 755.4 830.5
Deferred income taxes 185.9 172.2 Prepaid expenses 34.3 35.7 Other
receivables 41.5 43.7 Assets held for sale 65.0 - -------- --------
Total Current Assets 2,526.2 2,149.3 -------- -------- Property and
equipment, net 1,147.8 1,192.1 Intangible assets, net 406.5 404.4
Goodwill 1,243.4 1,167.4 Deferred income taxes 54.5 70.1
Investments 49.3 37.6 Other assets 75.2 53.2 -------- --------
Total Assets $5,502.9 $5,074.1 ======== ======== Liabilities and
Shareholders' Equity Current Liabilities: Short-term borrowings
$23.6 $338.3 Trade accounts payable 229.5 231.5 Salaries, wages and
commissions 176.5 144.7 Deferred income taxes 0.1 1.5 Other accrued
liabilities 438.3 331.5 Liabilities related to assets held for sale
13.9 - -------- -------- Total Current Liabilities 881.9 1,047.5
-------- -------- Long-term debt 1,707.3 1,834.0 Deferred income
taxes 18.6 25.2 Post-retirement obligations and other long-term
liabilities 271.4 391.0 Commitments and Contingencies --------
-------- Total Shareholders' Equity 2,623.7 1,776.4 --------
-------- Total Liabilities and Shareholders' Equity $5,502.9
$5,074.1 ======== ======== Hospira, Inc. Condensed Consolidated
Statements of Cash Flows (Unaudited) (dollars in millions) Years
Ended December 31, --------------- 2009 2008 ------ ------ Cash
Flow From Operating Activities: Net income $403.9 $320.9
Adjustments to reconcile net income to net cash from operating
activities- Depreciation 168.6 183.2 Amortization of intangible
assets 61.5 68.7 Write-off of acquired in-process research and
development - 0.5 Stock-based compensation expense 40.5 42.0
Deferred income taxes and other tax adjustments (66.3) 43.5
Impairment and other asset charges 95.8 - Net gains on sales of
assets - (3.0) Changes in assets and liabilities- Trade receivables
97.2 (55.4) Inventories 54.4 (117.9) Prepaid expenses and other
assets 8.2 12.9 Trade accounts payable (4.2) 49.5 Other liabilities
107.5 15.8 Other, net (22.2) 23.4 ------- ------- Net Cash Provided
by Operating Activities 944.9 584.1 ------- ------- Cash Flow From
Investing Activities: Capital expenditures (including instruments
placed with or leased to customers) (159.4) (164.3) Acquisitions,
net of cash acquired, and payments for contingent consideration
(86.6) (26.1) Purchases of intangibles and other investments (14.3)
(50.8) Proceeds from disposition of businesses and assets 49.2 0.8
Purchases of marketable equity securities - (24.5) ------- -------
Net Cash Used in Investing Activities (211.1) (264.9) -------
------- Cash Flow From Financing Activities: Issuance of long-term
debt, net of fees paid 246.7 - Repayment of long-term debt (681.2)
(95.2) Other borrowings, net 2.6 6.3 Excess tax benefit from
stock-based compensation arrangements 0.8 1.0 Proceeds from stock
options exercised 122.5 27.8 ------- ------- Net Cash Used in
Financing Activities (308.6) (60.1) ------- ------- Effect of
exchange rate changes on cash and cash equivalents 37.0 (16.4)
------- ------- Net change in cash and cash equivalents 462.2 242.7
Cash and cash equivalents at beginning of year 483.8 241.1 -------
------- Cash and cash equivalents at end of year $946.0 $483.8
======= ======= Supplemental Cash Flow Information: Cash paid
during the year- Interest $108.7 $120.8 Income taxes, net of
refunds $28.4 $14.9 Hospira, Inc. Net Sales by Product Line
(Unaudited) (dollars in millions) Three Months Ended December 31,
----------------------------------- % Change % Change at at Actual
Constant Currency Currency 2009 2008 Rates Rates (1) --------
------ ----- --------- Americas-- Pharmaceuticals Specialty
Injectables $439.2 $347.2 26.5 % 25.1 % Other Pharma 153.2 147.6
3.8 % 3.0 % -------- ------ 592.4 494.8 19.7 % 18.5 % Devices
Medication Management Systems 148.0 140.6 5.3 % 3.1 % Other Devices
83.1 85.8 (3.1)% (4.9)% -------- ------ 231.1 226.4 2.1 % 0.0 %
Total Americas 823.5 721.2 14.2 % 12.7 % Europe, Middle East &
Africa-- Pharmaceuticals Specialty Injectables 76.7 63.2 21.4 % 9.7
% Other Pharma 39.7 31.9 24.5 % 12.9 % -------- ------ 116.4 95.1
22.4 % 10.7 % Devices Medication Management Systems 22.1 16.7 32.3
% 18.6 % Other Devices 15.1 16.0 (5.6)% (19.4)% -------- ------
37.2 32.7 13.8 % 0.0 % Total Europe, Middle East & Africa 153.6
127.8 20.2 % 8.0 % Asia Pacific-- Pharmaceuticals Specialty
Injectables 62.4 50.1 24.6 % 0.6 % Other Pharma 4.3 3.1 38.7 % 9.7
% -------- ------ 66.7 53.2 25.4 % 1.1 % Devices Medication
Management Systems 6.2 4.4 40.9 % 25.0 % Other Devices 5.2 7.1
(26.8)% (39.4)% -------- ------ 11.4 11.5 (0.9)% (14.8)% Total Asia
Pacific 78.1 64.7 20.7 % (1.7)% -------- ------ Net Sales $1,055.2
$913.7 15.5 % 11.0 % ======== ====== Global-- Pharmaceuticals
Specialty Injectables $578.3 $460.5 25.6 % 20.3 % Other Pharma
197.2 182.6 8.0 % 4.8 % -------- ------ 775.5 643.1 20.6 % 15.9 %
Devices Medication Management Systems 176.3 161.7 9.0 % 5.3 % Other
Devices 103.4 108.9 (5.1)% (9.3)% -------- ------ 279.7 270.6 3.4 %
(0.6)% -------- ------ Net Sales $1,055.2 $913.7 15.5 % 11.0 %
======== ====== Years Ended December 31,
---------------------------------- % Change % Change at at Currency
Currency Actual Constant 2009 2008 Rates Rates (1) --------
-------- ----- --------- Americas-- Pharmaceuticals Specialty
Injectables $1,589.9 $1,328.9 19.6 % 20.3 % Other Pharma 556.4
522.0 6.6 % 7.8 % -------- -------- 2,146.3 1,850.9 16.0 % 16.7 %
Devices Medication Management Systems 559.7 558.9 0.1 % 1.2 % Other
Devices 357.3 368.5 (3.0)% (2.3)% -------- -------- 917.0 927.4
(1.1)% (0.2)% Total Americas 3,063.3 2,778.3 10.3 % 11.1 % Europe,
Middle East & Africa-- Pharmaceuticals Specialty Injectables
272.0 287.4 (5.4)% 2.1 % Other Pharma 128.4 152.1 (15.6)% (8.8)%
-------- -------- 400.4 439.5 (8.9)% (1.7)% Devices Medication
Management Systems 77.8 75.9 2.5 % 8.6 % Other Devices 64.6 68.4
(5.6)% 0.9 % -------- -------- 142.4 144.3 (1.3)% 4.9 % Total
Europe, Middle East & Africa 542.8 583.8 (7.0)% (0.1)% Asia
Pacific-- Pharmaceuticals Specialty Injectables 211.4 205.4 2.9 %
7.2 % Other Pharma 16.4 15.2 7.9 % 17.8 % -------- -------- 227.8
220.6 3.3 % 7.9 % Devices Medication Management Systems 21.2 19.9
6.5 % 11.1 % Other Devices 24.2 26.9 (10.0)% (8.9)% --------
-------- 45.4 46.8 (3.0)% (0.4)% Total Asia Pacific 273.2 267.4 2.2
% 6.5 % -------- -------- Net Sales $3,879.3 $3,629.5 6.9 % 9.0 %
======== ======== Global-- Pharmaceuticals Specialty Injectables
$2,073.3 $1,821.7 13.8 % 15.9 % Other Pharma 701.2 689.3 1.7 % 4.4
% -------- -------- 2,774.5 2,511.0 10.5 % 12.7 % Devices
Medication Management Systems 658.7 654.7 0.6 % 2.3 % Other Devices
446.1 463.8 (3.8)% (2.2)% -------- -------- 1,104.8 1,118.5 (1.2)%
0.4 % -------- -------- Net Sales $3,879.3 $3,629.5 6.9 % 9.0 %
======== ======== (1) The Non-GAAP financial measures contained in
this press release include comparisons at constant currency rates
(reflecting comparative local currency balances at prior period
foreign exchange rates), which we define as current period net
sales excluding the impact of the change in foreign exchange rates
less prior period reported net sales divided by prior period
reported net sales. This financial measure provides information on
the change in net sales assuming that foreign currency exchange
rates have not changed between the prior and the current period.
Management believes the use of this financial measure aids in the
understanding of our change in net sales without the impact of
foreign currency. All Non-GAAP financial measures are intended to
supplement the applicable GAAP measures and should not be
considered in isolation from, or a replacement for, financial
measures prepared in accordance with GAAP. Hospira, Inc. Segment
Information (Unaudited) (dollars in millions) Three Months Ended
December 31,
---------------------------------------------------------- Net
Sales Income from Operations ----------------- %
-------------------- % 2009 2008 Change 2009 2008 Change --------
------ ------ ------ ------ ------ Americas $823.5 $721.2 14.2 %
$173.9 A $172.0 A 1.1 % Europe, Middle East & Africa 153.6
127.8 20.2 % (7.8) B 2.1 B (471.4)% Asia Pacific 78.1 64.7 20.7 %
3.1 C 9.4 C (67.0)% -------- ------ ------ ------ Total reportable
segments $1,055.2 $913.7 15.5 % 169.2 183.5 (7.8)% ======== ======
Corporate functions (24.6) D (19.0) D 29.5 % Stock-based
compensation (9.0) (8.8) 2.3 % ------ ------ Income from operations
135.6 155.7 (12.9)% Interest expense and other expense, net (23.6)
(29.6) (20.3)% ------ ------ Income before income taxes $112.0
$126.1 (11.2)% ====== ====== Included in the reported Income before
income taxes above, are the following charges: A -- Americas
Project Fuel and related impairment $19.2 $ - Facilities
Optimization 8.3 9.5 Amortization of Mayne Pharma intangible assets
4.8 4.2 Integration-related - 1.6 ------ ------ Total Americas 32.3
15.3 B -- Europe, Middle East & Africa Project Fuel and related
impairment 5.7 - Amortization of Mayne Pharma intangible assets 4.0
8.1 Integration-related - 0.5 Research and development 16.0 -
------ ------ Total Europe, Middle East & Africa 25.7 8.6 C --
Asia Pacific Project Fuel and related impairment 1.5 - Amortization
of Mayne Pharma intangible assets 4.5 3.7 Integration-related - 1.8
------ ------ Total Asia Pacific 6.0 5.5 D -- Corporate functions
Project Fuel and related impairment 4.6 - Integration-related - 3.1
------ ------ Total Corporate functions 4.6 3.1 ------ ------ Total
$68.6 $32.5 ====== ====== Hospira, Inc. Segment Information
(Unaudited) (dollars in millions) Years Ended December 31,
---------------------------------------------------------- Net
Sales Income from Operations ----------------- %
-------------------- % 2009 2008 Change 2009 2008 Change --------
-------- ------ ------ ------ ------ Americas $3,063.3 $2,778.3
10.3 % $625.5 A $598.0 A 4.6 % Europe, Middle East & Africa
542.8 583.8 (7.0)% 1.8 B 12.8 B (85.9)% Asia Pacific 273.2 267.4
2.2 % 7.0 C 23.0 C (69.6)% -------- -------- ------ ------ Total
reportable segments $3,879.3 $3,629.5 6.9 % 634.3 633.8 0.1 %
======== ======== Corporate functions (90.9) D (74.0) D 22.8 %
Stock-based compensation (40.5) (42.0) (3.6)% ------ ------ Income
from operations 502.9 517.8 (2.9)% Interest expense and other
expense, net (118.1) E (110.3) E 7.1 % ------ ------ Income before
income taxes $384.8 $407.5 (5.6)% ====== ====== Included in the
reported Income before income taxes above, are the following
charges: A -- Americas Project Fuel and related impairment $101.2 $
- Facilities Optimization 28.4 35.4 Amortization of Mayne Pharma
intangible assets 17.9 19.2 Integration-related - 3.7 Acquired
in-process research and development - 0.5 ------ ------ Total
Americas 147.5 58.8 B -- Europe, Middle East & Africa Project
Fuel and related impairment 9.7 - Amortization of Mayne Pharma
intangible assets 20.1 25.8 Integration-related - 10.6 Research and
development 16.0 - ------ ------ Total Europe, Middle East &
Africa 45.8 36.4 C -- Asia Pacific Project Fuel and related
impairment 10.8 - Amortization of Mayne Pharma intangible assets
16.2 17.8 Integration-related - 8.5 ------ ------ Total Asia
Pacific 27.0 26.3 D -- Corporate functions Project Fuel and related
impairment 14.8 - Integration-related - 7.8 ------ ------ Total
Corporate functions 14.8 7.8 E -- Interest expense and other
expense (income), net Impairment of marketable equity securities
16.6 - ------ ------ Total Interest expense and other expense
(income), net 16.6 - ------ ------ Total $251.7 $129.3 ======
====== http://www.newscom.com/cgi-bin/prnh/20040503/HSPLOGO
http://photoarchive.ap.org/ DATASOURCE: Hospira, Inc. CONTACT:
Media, Stacey Eisen, +1-224-212-2276, or Tareta Adams,
+1-224-212-2535, or Financial Community, Karen King,
+1-224-212-2711, or Ruth Venning, +1-224-212-2774, all of Hospira,
Inc. Web Site: http://www.hospira.com/
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