ABBOTT PARK, Ill., Jan. 29, 2015
/PRNewswire/ -- Abbott today announced financial results for
the fourth quarter ended Dec. 31,
2014.
- Diluted EPS, excluding specified items, was $0.71 in the fourth quarter and $2.28 for the full year, above Abbott's previous
guidance range and reflecting 13.4 percent growth. This includes
results from both continuing and discontinued operations. Reported
diluted EPS under GAAP was $0.59 in
the fourth quarter and $1.49 for the
full year. See page 2 for additional detail regarding financial
results from discontinued operations.
- Fourth-quarter worldwide sales of $5.4
billion from continuing operations increased 10.2 percent on
an operational basis, including double-digit growth in emerging
markets. Worldwide sales increased 5.6 percent on a reported basis,
including an unfavorable 4.6 percent effect of foreign
exchange.
- For full-year 2014, Abbott expanded its adjusted operating
margin ratio from continuing operations by 200 basis points over
the prior year, primarily driven by continued improvements in
Diagnostics, Nutrition and Vascular. The operating margin ratio
from continuing operations under GAAP improved by 190 basis points
over prior year.
- Abbott issues full-year 2015 EPS guidance for continuing
operations, excluding specified items, of $2.10 to $2.20. Projected full-year 2015 EPS for
continuing operations under GAAP is $1.33 to
$1.43.
- In December, Abbott completed its acquisitions of Topera, Inc.,
a medical device company focused on developing innovative
electrophysiology technologies, and Veropharm, a leading Russian
pharmaceutical company.
- In Diagnostics, Abbott received European approval for its
IRIDICA infectious disease testing platform and U.S. FDA clearance
for a heart failure test on its ARCHITECT platform. In Medical
Devices in the U.S., Abbott received FDA approval for its
TECNIS® Multifocal Low Add intraocular lens (IOL) and
launched its new XIENCE Alpine™ drug-eluting stent
system, designed for complex interventions.
"We ended 2014 with good momentum, well positioned for a step-up
in operational sales growth in 2015," said Miles D. White, chairman and chief executive
officer, Abbott. "While we'll need to manage through currency
headwinds again in 2015, we're targeting another year of top-tier
earnings growth."
Fourth-Quarter Business Overview
Note regarding presentation of financial results: Financial
results from Abbott's developed markets branded generics
pharmaceuticals and Animal Health businesses have been excluded
from continuing operations and are reported as discontinued
operations in the Earnings and EPS lines of the Consolidated
Statement of Earnings due to the pending sale of these businesses
to Mylan and Zoetis, respectively. Prior year and year-to-date
results also have been adjusted to report the
developed markets branded generics pharmaceuticals business and
Animal Health business as discontinued operations. As a result,
Sales and Consolidated Statement of Earnings reflect the remaining
business at Abbott, reported as continuing operations. Animal
Health sales were previously reported in Other Sales.
Following are sales by business segment from continuing
operations and commentary for the fourth quarter and the full
year:
Total Company
($ in millions)
|
|
|
|
|
|
|
|
% Change vs.
4Q13
|
|
|
Sales
4Q14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
*
|
|
1,548
|
|
3,808
|
|
5,356
|
|
(1.7)
|
|
15.6
|
|
8.9
|
|
10.2
|
|
5.6
|
Nutrition
|
|
687
|
|
1,117
|
|
1,804
|
|
(5.1)
|
|
19.3
|
|
14.3
|
|
8.9
|
|
6.0
|
Diagnostics
|
|
349
|
|
885
|
|
1,234
|
|
8.9
|
|
8.5
|
|
1.1
|
|
8.6
|
|
3.2
|
Established
Pharmaceuticals
|
|
--
|
|
922
|
|
922
|
|
n/a
|
|
35.4
|
|
26.9
|
|
35.4
|
|
26.9
|
Medical
Devices
|
|
507
|
|
872
|
|
1,379
|
|
(2.9)
|
|
2.2
|
|
(4.4)
|
|
0.4
|
|
(3.9)
|
|
* Total Abbott Sales
from continuing operations include Other Sales of $17
million.
|
|
|
|
|
|
|
|
|
% Change vs.
12M13
|
|
|
Sales
12M14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
*
|
|
6,123
|
|
14,124
|
|
20,247
|
|
(1.4)
|
|
8.7
|
|
5.0
|
|
5.5
|
|
3.0
|
Nutrition
|
|
2,835
|
|
4,118
|
|
6,953
|
|
(1.6)
|
|
10.0
|
|
6.7
|
|
5.0
|
|
3.2
|
Diagnostics
|
|
1,310
|
|
3,410
|
|
4,720
|
|
5.9
|
|
6.6
|
|
3.1
|
|
6.4
|
|
3.9
|
Established
Pharmaceuticals
|
|
--
|
|
3,118
|
|
3,118
|
|
n/a
|
|
14.9
|
|
9.0
|
|
14.9
|
|
9.0
|
Medical
Devices
|
|
1,958
|
|
3,434
|
|
5,392
|
|
(5.0)
|
|
3.4
|
|
1.0
|
|
0.2
|
|
(1.2)
|
|
* Total Abbott Sales
from continuing operations include Other Sales of $64
million.
|
n/a = Not
Applicable.
|
Note: Operational
growth reflects percentage change over the prior year excluding the
impact of exchange rates.
|
Fourth-quarter 2014 worldwide sales from continuing operations
of $5.4 billion increased 10.2
percent on an operational basis. Sales increased 5.6 percent on a
reported basis, including an unfavorable 4.6 percent effect of
foreign exchange.
Excluding the impact from CFR Pharmaceuticals and Veropharm,
which Abbott acquired on Sept. 26,
2014, and Dec. 11, 2014,
respectively, worldwide sales from continuing operations increased
6.5 percent on an operational basis in the quarter, driven by
strong performance in Established Pharmaceuticals, Nutrition and
Diagnostics.
International sales from continuing operations increased 15.6
percent on an operational basis and 8.9 percent on a reported basis
in the fourth quarter.
Emerging market sales from continuing operations increased 22.8
percent on an operational basis and 17.2 percent on a reported
basis in the fourth quarter. Excluding the impact from CFR
Pharmaceuticals and Veropharm, emerging market sales from
continuing operations increased 14.5 percent on an operational
basis, driven by double-digit growth in Nutrition and
Diagnostics.
Nutrition
($ in
millions)
|
|
|
|
|
|
|
|
% Change vs.
4Q13
|
|
|
Sales
4Q14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
|
|
687
|
|
1,117
|
|
1,804
|
|
(5.1)
|
|
19.3
|
|
14.3
|
|
8.9
|
|
6.0
|
Pediatric
|
|
383
|
|
660
|
|
1,043
|
|
(1.1)
|
|
24.3
|
|
20.3
|
|
13.8
|
|
11.4
|
Adult
|
|
304
|
|
457
|
|
761
|
|
(9.7)
|
|
12.8
|
|
6.6
|
|
2.9
|
|
(0.5)
|
|
|
|
|
|
|
|
|
% Change vs.
12M13
|
|
|
Sales
12M14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
|
|
2,835
|
|
4,118
|
|
6,953
|
|
(1.6)
|
|
10.0
|
|
6.7
|
|
5.0
|
|
3.2
|
Pediatric
|
|
1,521
|
|
2,357
|
|
3,878
|
|
(0.8)
|
|
7.2
|
|
4.5
|
|
4.0
|
|
2.4
|
Adult
|
|
1,314
|
|
1,761
|
|
3,075
|
|
(2.6)
|
|
14.0
|
|
10.0
|
|
6.4
|
|
4.2
|
Worldwide Nutrition sales increased 8.9 percent in the fourth
quarter on an operational basis and 6.0 percent on a reported
basis, including an unfavorable 2.9 percent effect of foreign
exchange. Abbott Nutrition continued to increase its local presence
in key markets. During 2014, Abbott opened three new manufacturing
plants in China, India and the U.S. to meet increasing demand
for its products, and formed a strategic partnership with the
world's largest dairy cooperative, Fonterra, to invest locally in
China's milk supply.
Worldwide Pediatric Nutrition sales increased 13.8 percent on an
operational basis and 11.4 percent on a reported basis in the
quarter, including an unfavorable 2.4 percent effect of foreign
exchange. Sales growth in the quarter was led by strong
international growth with the continued market uptake of recently
launched products, including new infant formula products in
China, Eleva™ and
Similac® QINTI™.
Worldwide Adult Nutrition sales increased 2.9 percent on an
operational basis and decreased 0.5 percent on a reported basis in
the quarter, including an unfavorable 3.4 percent effect of foreign
exchange. International Adult Nutrition sales increased double
digits in the quarter on an operational basis driven by the
continued expansion of the adult nutrition category
internationally. Abbott recently launched its new
Ensure® brand in China,
which represents a significant long-term growth opportunity. U.S.
Adult Nutrition sales were impacted by a decline in performance
nutrition, as well as dynamics in the institutional market
segment.
Diagnostics
($ in millions)
|
|
|
|
|
|
|
|
% Change vs.
4Q13
|
|
|
Sales
4Q14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
|
|
349
|
|
885
|
|
1,234
|
|
8.9
|
|
8.5
|
|
1.1
|
|
8.6
|
|
3.2
|
Core
Laboratory
|
|
204
|
|
782
|
|
986
|
|
9.0
|
|
8.5
|
|
0.9
|
|
8.6
|
|
2.5
|
Molecular
|
|
50
|
|
81
|
|
131
|
|
(4.8)
|
|
10.5
|
|
4.3
|
|
4.4
|
|
0.6
|
Point of
Care
|
|
95
|
|
22
|
|
117
|
|
17.7
|
|
1.1
|
|
(1.8)
|
|
14.2
|
|
13.6
|
|
|
|
|
|
|
|
|
% Change vs.
12M13
|
|
|
Sales
12M14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
|
|
1,310
|
|
3,410
|
|
4,720
|
|
5.9
|
|
6.6
|
|
3.1
|
|
6.4
|
|
3.9
|
Core
Laboratory
|
|
765
|
|
3,049
|
|
3,814
|
|
7.9
|
|
6.7
|
|
3.0
|
|
6.9
|
|
4.0
|
Molecular
|
|
199
|
|
278
|
|
477
|
|
(1.8)
|
|
4.9
|
|
3.0
|
|
2.0
|
|
0.9
|
Point of
Care
|
|
346
|
|
83
|
|
429
|
|
6.6
|
|
8.4
|
|
6.8
|
|
6.9
|
|
6.6
|
Worldwide Diagnostics sales increased 8.6 percent in the fourth
quarter on an operational basis and 3.2 percent on a reported
basis, including an unfavorable 5.4 percent effect of foreign
exchange. This business continues to deliver durable growth across
emerging and developed markets as it expands its margin, while also
investing in the development of several next-generation diagnostic
platforms across all of its business units.
Core Laboratory Diagnostics sales increased 8.6 percent in the
quarter on an operational basis, driven by strong growth in the
U.S. and internationally as a result of competitive wins and
double-digit growth in emerging markets. Sales increased 2.5
percent on a reported basis, including an unfavorable 6.1 percent
effect of foreign exchange. In the fourth quarter, Abbott received
U.S. FDA clearance for the first automated galectin-3 test for use
on its ARCHITECT platform to aid doctors in assessing the prognosis
of people diagnosed with chronic heart failure.
Molecular Diagnostics sales increased 4.4 percent in the quarter
on an operational basis and 0.6 percent on a reported basis,
including an unfavorable 3.8 percent effect of foreign exchange.
Sales growth in the quarter was driven by double-digit growth on an
operational basis in the infectious disease business, which
represents more than 50 percent of Molecular Diagnostics sales.
U.S. growth was impacted by continued market dynamics in the
oncology and genetics businesses. In December, Abbott received
European approval for its IRIDICA infectious disease testing
platform. IRIDICA has the potential to help identify serious
infections, such as sepsis and pneumonia, sooner than the current
standard of care and could help lower associated health care costs
by 30 percent.
Point of Care Diagnostics sales increased 14.2 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 13.6 percent on a reported basis, including an
unfavorable 0.6 percent effect of foreign exchange.
Established Pharmaceuticals
($ in millions)
Note regarding presentation of financial results: In
accordance with GAAP, financial results from the
developed markets branded generics pharmaceuticals business have
been excluded from continuing operations due to the pending sale of
this business to Mylan and are reported as discontinued operations.
Prior year and year-to-date results also have been adjusted to
report the developed markets branded generics
pharmaceuticals business as discontinued operations. Therefore,
sales shown in the following charts represent continuing
operations. See pages below for reconciliation of sales
between continuing and discontinued operations for 2013 and
2014.
|
|
|
|
|
|
|
|
% Change vs.
4Q13
|
|
|
Sales
4Q14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
|
|
--
|
|
922
|
|
922
|
|
n/a
|
|
35.4
|
|
26.9
|
|
35.4
|
|
26.9
|
Key Emerging
Markets
|
|
--
|
|
600
|
|
600
|
|
n/a
|
|
10.6
|
|
1.3
|
|
10.6
|
|
1.3
|
Other Emerging
Markets *
|
|
--
|
|
322
|
|
322
|
|
n/a
|
|
>100
|
|
>100
|
|
>100
|
|
>100
|
* Includes $184MM as
a result of the acquisition of CFR Pharmaceuticals (transaction
closed Sept. 26, 2014).
|
|
|
|
|
|
|
|
|
% Change vs.
12M13
|
|
|
Sales
12M14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
|
|
--
|
|
3,118
|
|
3,118
|
|
n/a
|
|
14.9
|
|
9.0
|
|
14.9
|
|
9.0
|
Key Emerging
Markets
|
|
--
|
|
2,308
|
|
2,308
|
|
n/a
|
|
7.7
|
|
1.2
|
|
7.7
|
|
1.2
|
Other Emerging
Markets *
|
|
--
|
|
810
|
|
810
|
|
n/a
|
|
43.1
|
|
39.4
|
|
43.1
|
|
39.4
|
* Includes $200MM as
a result of the acquisition of CFR Pharmaceuticals (transaction
closed Sept. 26, 2014).
|
n/a = Not
Applicable.
|
Established Pharmaceuticals sales from continuing operations
increased 35.4 percent in the fourth quarter on an operational
basis and 26.9 percent on a reported basis, including an
unfavorable 8.5 percent effect of foreign exchange. Excluding the
impact of recent acquisitions, Established Pharmaceuticals sales
from continuing operations increased 9.4 percent on an operational
basis in the quarter.
Key Emerging Markets include India, Russia, China
and Brazil, along with several
additional emerging markets that represent the most attractive
long-term growth opportunities for Abbott's branded generics
product portfolio. Sales in these geographies increased 10.6
percent on an operational basis led by strong growth in
India, China and Russia. Sales increased 1.3 percent on a
reported basis, including an unfavorable 9.3 percent effect of
foreign exchange.
In December, Abbott completed its acquisition of Veropharm, a
leading Russian pharmaceutical company. Through this acquisition,
Abbott establishes a manufacturing footprint in Russia and obtains a portfolio of medicines
that is well aligned with Abbott's current pharmaceutical
therapeutic areas of focus.
Medical Devices
($ in millions)
|
|
|
|
|
|
|
|
% Change vs.
4Q13
|
|
|
Sales
4Q14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
|
|
507
|
|
872
|
|
1,379
|
|
(2.9)
|
|
2.2
|
|
(4.4)
|
|
0.4
|
|
(3.9)
|
Vascular
|
|
289
|
|
464
|
|
753
|
|
1.3
|
|
1.9
|
|
(4.7)
|
|
1.7
|
|
(2.5)
|
Diabetes
Care
|
|
108
|
|
205
|
|
313
|
|
(15.9)
|
|
0.6
|
|
(5.9)
|
|
(5.5)
|
|
(9.6)
|
Medical
Optics
|
|
110
|
|
203
|
|
313
|
|
1.2
|
|
4.8
|
|
(2.1)
|
|
3.6
|
|
(0.9)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vascular Product
Lines:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DES/BVSa)
|
|
115
|
|
255
|
|
370
|
|
(8.8)
|
|
(1.9)
|
|
(7.9)
|
|
(4.1)
|
|
(8.2)
|
Other Coronary
Productsb)
|
49
|
|
95
|
|
144
|
|
--
|
|
1.7
|
|
(4.9)
|
|
1.1
|
|
(3.3)
|
Endovascularc)
|
|
71
|
|
65
|
|
136
|
|
12.1
|
|
14.5
|
|
7.2
|
|
13.2
|
|
9.7
|
|
|
|
|
|
|
|
|
% Change vs.
12M13
|
|
|
Sales
12M14
|
|
|
|
Int'l
|
|
Total
|
|
|
U.S.
|
|
Int'l
|
|
Total
|
|
U.S.
|
|
Operational
|
|
Reported
|
|
Operational
|
|
Reported
|
Total
|
|
1,958
|
|
3,434
|
|
5,392
|
|
(5.0)
|
|
3.4
|
|
1.0
|
|
0.2
|
|
(1.2)
|
Vascular
|
|
1,116
|
|
1,870
|
|
2,986
|
|
(2.8)
|
|
2.5
|
|
0.3
|
|
0.5
|
|
(0.9)
|
Diabetes
Care
|
|
405
|
|
785
|
|
1,190
|
|
(22.0)
|
|
1.9
|
|
(0.3)
|
|
(7.6)
|
|
(8.9)
|
Medical
Optics
|
|
437
|
|
779
|
|
1,216
|
|
10.6
|
|
7.4
|
|
4.4
|
|
8.5
|
|
6.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vascular Product
Lines:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DES/BVSa)
|
|
448
|
|
1,015
|
|
1,463
|
|
(12.2)
|
|
(0.9)
|
|
(3.6)
|
|
(4.6)
|
|
(6.4)
|
Other Coronary
Productsb)
|
196
|
|
384
|
|
580
|
|
1.2
|
|
1.5
|
|
(0.3)
|
|
1.4
|
|
0.2
|
Endovascularc)
|
|
267
|
|
260
|
|
527
|
|
8.1
|
|
15.4
|
|
13.9
|
|
11.6
|
|
10.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
a)Includes
drug-eluting stents and bioresorbable vascular scaffold (BVS)
product portfolio.
|
|
|
|
|
b)Includes
guide wires, balloon catheters and other coronary
products.
|
|
|
|
|
|
|
c)Includes
vessel closure, carotid stents and other peripheral
products.
|
|
|
|
|
|
|
Worldwide Medical Devices sales increased 0.4 percent in the
fourth quarter on an operational basis and decreased 3.9 percent on
a reported basis, including an unfavorable 4.3 percent effect of
foreign exchange. In December, Abbott completed its acquisition of
Topera, Inc., which provides Abbott with a foundational entry in
the large, high-growth electrophysiology market. Topera's
breakthrough technology can transform how physicians treat people
with complex heart rhythm disorders.
Worldwide sales of Vascular products increased 1.7 percent in
the quarter on an operational basis, representing a sequential
improvement versus third quarter 2014. Sales decreased 2.5 percent
on a reported basis, including an unfavorable 4.2 percent effect of
foreign exchange. Abbott's MitraClip® structural heart
product for the treatment of mitral regurgitation and Endovascular
business both grew double digits globally in the quarter on an
operational basis. This growth was offset by a decline in
drug-eluting stent sales. In the U.S., in the fourth quarter,
Abbott launched XIENCE Alpine, its new drug-eluting stent (DES)
system designed for peak performance in complex interventions.
XIENCE Alpine is the only DES on the U.S. market with an indication
to treat chronic total occlusions.
Worldwide Diabetes Care sales decreased 5.5 percent in the
quarter on an operational basis and 9.6 percent on a reported
basis, including an unfavorable 4.1 percent effect of foreign
exchange. The U.S. sales were in line with expectations, as the
impact of CMS reimbursement reductions and market dynamics
continued to moderate. Outside of the U.S., Abbott launched its
recently approved FreeStyle Libre Flash Glucose Monitoring
System direct to consumers. FreeStyle® Libre is a
revolutionary new glucose sensing technology that eliminates
routine finger pricks, requires no finger-prick calibration and
presents data in a user-friendly, visual chart, enabling productive
treatment discussions between patients and healthcare
professionals.
Worldwide Medical Optics sales increased 3.6 percent in the
quarter on an operational basis and decreased 0.9 percent on a
reported basis, including an unfavorable 4.5 percent effect of
foreign exchange. Sales of cataract products, which represent
approximately 70 percent of Medical Optics sales, increased high
single digits in the quarter globally on an operational basis. This
growth was partially offset by market declines in the refractive
and corneal businesses. In the U.S. in the quarter, Abbott received
FDA approval for its TECNIS Multifocal Low Add IOL, a new premium
lens that provides more range-of-vision options to patients and
surgeons.
Abbott issues earnings-per-share outlook for 2015
Abbott is issuing full-year 2015 guidance for earnings-per-share
from continuing operations, excluding specified items, of
$2.10 to $2.20, representing top-tier
growth at the mid-point of the guidance range.
Abbott forecasts net specified items for the full year 2015 of
approximately $0.77 per share.
Specified items include intangible amortization expense, charges
associated with cost reduction initiatives and deal and other
expenses related to acquisitions.
Including net specified items, projected earnings per share from
continuing operations under Generally Accepted Accounting
Principles (GAAP) would be $1.33 to
$1.43 for the full year 2015.
Abbott is issuing first-quarter 2015 guidance for
earnings-per-share guidance from continuing operations, excluding
specified items, of $0.41 to $0.43.
Abbott forecasts specified items for the first quarter 2015 of
$0.23 related to the same items
discussed above for the full year 2015. Including specified items,
projected earnings-per-share from continuing operations under GAAP
would be $0.18 to $0.20 for the first
quarter.
Abbott announces increase in quarterly dividend
On Dec. 12, 2014, the board of
directors of Abbott increased the company's quarterly dividend to
$0.24 per share from $0.22 per share. Abbott's cash dividend is
payable Feb. 15, 2015, to
shareholders of record at the close of business on Jan. 15, 2015. This marks the 364th
consecutive quarterly dividend paid by Abbott.
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 (NYSE: ABT) 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 77,000
people.
Visit Abbott at www.abbott.com and connect with us on Twitter at
@AbbottNews.
Abbott will webcast its live fourth-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, 2013, 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
|
Fourth Quarter Ended
December 31, 2014 and 2013
|
(in millions, except
per share data)
|
(unaudited)
|
|
|
|
4Q14
|
|
4Q13
|
|
%
Change
|
|
Net Sales
|
|
$5,356
|
|
$5,072
|
|
5.6
|
|
|
|
|
|
|
|
|
|
Cost of products
sold, excluding amortization expense
|
|
2,337
|
|
2,374
|
|
(1.6)
|
|
Amortization of
intangible assets
|
|
163
|
|
147
|
|
12.0
|
|
Research and
development
|
|
361
|
|
363
|
|
(0.7)
|
|
Selling, general, and
administrative
|
|
1,666
|
|
1,561
|
|
6.7
|
|
Total Operating Cost
and Expenses
|
|
4,527
|
|
4,445
|
|
1.9
|
|
|
|
|
|
|
|
|
|
Operating
earnings
|
|
829
|
|
627
|
|
31.9
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
19
|
|
14
|
|
41.2
|
|
Net loss on
extinguishment of debt
|
|
18
|
|
--
|
|
n/m
|
|
Net foreign exchange
(gain) loss
|
|
(24)
|
|
10
|
|
n/m
|
|
Other (income)
expense, net
|
|
12
|
|
(3)
|
|
n/m
|
|
Earnings from
Continuing Operations before taxes
|
|
804
|
|
606
|
|
32.4
|
|
|
|
|
|
|
|
|
|
Taxes on Earnings
from Continuing Operations
|
|
170
|
|
123
|
|
37.8
|
|
Earnings from
Continuing Operations
|
|
634
|
|
483
|
|
31.2
|
|
|
|
|
|
|
|
|
|
Earnings from
Discontinued Operations, net of taxes
|
|
271
|
|
106
|
|
n/m
|
1) 2)
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
$905
|
|
$589
|
|
53.6
|
|
|
|
|
|
|
|
|
|
Net Earnings from
Continuing Operations, excluding
|
|
|
|
|
|
|
|
Specified Items, as
described below
|
|
$943
|
|
$754
|
|
25.0
|
3)
|
|
|
|
|
|
|
|
|
Net Earnings from
Discontinued Operations, excluding
|
|
|
|
|
|
|
|
Specified Items, as
described below
|
|
145
|
|
164
|
|
(11.1)
|
1) 4)
|
|
|
|
|
|
|
|
|
Net Earnings,
excluding Specified Items, as described below
|
|
$1,088
|
|
$918
|
|
18.6
|
|
|
|
|
|
|
|
|
|
Diluted Earnings per
Common Share from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
$0.41
|
|
$0.31
|
|
32.3
|
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
0.18
|
|
0.06
|
|
n/m
|
1) 2)
|
|
|
|
|
|
|
|
|
Total
|
|
$0.59
|
|
$0.37
|
|
59.5
|
|
|
|
|
|
|
|
|
|
Diluted Earnings per
Common Share, excluding Specified
|
|
|
|
|
|
|
|
Items, as described
below, from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
$0.62
|
|
$0.48
|
|
29.2
|
3)
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
0.09
|
|
0.10
|
|
(10.0)
|
1) 4)
|
|
|
|
|
|
|
|
|
Total
|
|
$0.71
|
|
$0.58
|
|
22.4
|
|
|
|
|
|
|
|
|
|
Average Number of
Common Shares Outstanding
|
|
|
|
|
|
|
|
Plus Dilutive Common
Stock Options and Awards
|
|
1,522
|
|
1,567
|
|
|
|
|
NOTES:
|
|
See tables below
for an explanation of certain non-GAAP financial
information.
|
|
n/m = Percent change
is not meaningful.
|
|
1)
|
Earnings and Diluted
Earnings per Common Share from Discontinued Operations reflect the
reporting of the developed markets branded generics pharmaceuticals
business and Abbott Animal Health due to the pending sale of these
businesses to Mylan and Zoetis respectively.
|
|
|
2)
|
2014 Earnings from
Discontinued Operations, net of taxes, also includes a net
favorable adjustment to tax expense of $129 million, or $0.09 per
share, as a result of the resolution of various tax positions from
previous years related to AbbVie operations.
|
|
|
3)
|
2014 Net Earnings
from Continuing Operations, excluding Specified Items, excludes net
after-tax charges of $309 million, or $0.21 per share, for
intangible amortization expense, expenses associated with cost
reduction initiatives and deal and other expenses related to the
acquisitions, as well as current quarter tax expense associated
with a one-time repatriation of 2014 ex-U.S. earnings, partially
offset by favorability as a result of the resolution of various tax
positions and adjustment of tax uncertainties from prior
years.
|
|
|
|
2013 Net Earnings
from Continuing Operations, excluding Specified Items, excludes
after-tax charges of $271 million, or $0.17 per share, for
intangible amortization expense; expenses associated with cost
reduction initiatives; a philanthropic contribution to the Abbott
Fund; and other costs, including integration and separation-related
costs.
|
|
|
4)
|
2014 Net Earnings
from Discontinued Operations, excluding Specified Items, excludes a
net favorable adjustment to tax expense of $129 million, or $0.09
per share, related to AbbVie operations, as discussed in note 2,
partially offset by net after-tax charges of $3 million.
|
|
|
|
2013 Net Earnings
from Discontinued Operations, excluding Specified Items, excludes
net after-tax charges of $58 million, or $0.04 per share, primarily
related to intangible amortization expense and cost reduction
initiatives.
|
Abbott Laboratories
and Subsidiaries
|
Consolidated
Statement of Earnings
|
Fiscal Year Ended
December 31, 2014 and 2013
|
(in millions, except
per share data)
|
(unaudited)
|
|
|
|
12M14
|
|
12M13
|
|
%
Change
|
|
Net Sales
|
|
$20,247
|
|
$19,657
|
|
3.0
|
|
|
|
|
|
|
|
|
|
Cost of products
sold, excluding amortization expense
|
|
9,218
|
|
9,193
|
|
0.3
|
|
Amortization of
intangible assets
|
|
555
|
|
588
|
|
(5.4)
|
|
Research and
development
|
|
1,345
|
|
1,371
|
|
(1.9)
|
|
Selling, general, and
administrative
|
|
6,530
|
|
6,372
|
|
2.5
|
|
Total Operating Cost
and Expenses
|
|
17,648
|
|
17,524
|
|
0.7
|
|
|
|
|
|
|
|
|
|
Operating
earnings
|
|
2,599
|
|
2,133
|
|
21.8
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
73
|
|
78
|
|
(6.2)
|
|
Net loss on
extinguishment of debt
|
|
18
|
|
--
|
|
n/m
|
|
Net foreign exchange
(gain) loss
|
|
(24)
|
|
46
|
|
n/m
|
|
Other (income)
expense, net
|
|
14
|
|
(32)
|
|
n/m
|
|
Earnings from
Continuing Operations before taxes
|
|
2,518
|
|
2,041
|
|
23.4
|
|
|
|
|
|
|
|
|
|
Taxes on Earnings
from Continuing Operations
|
|
797
|
|
53
|
|
n/m
|
1)
|
Earnings from
Continuing Operations
|
|
1,721
|
|
1,988
|
|
(13.4)
|
|
|
|
|
|
|
|
|
|
Earnings from
Discontinued Operations, net of taxes
|
|
563
|
|
588
|
|
(4.1)
|
2) 3)
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
$2,284
|
|
$2,576
|
|
(11.3)
|
|
|
|
|
|
|
|
|
|
Net Earnings from
Continuing Operations, excluding
|
|
|
|
|
|
|
|
Specified Items, as
described below
|
|
$3,038
|
|
$2,597
|
|
17.0
|
4)
|
|
|
|
|
|
|
|
|
Net Earnings from
Discontinued Operations, excluding
|
|
|
|
|
|
|
|
Specified Items, as
described below
|
|
465
|
|
592
|
|
(21.4)
|
2) 5)
|
|
|
|
|
|
|
|
|
Net Earnings,
excluding Specified Items, as described below
|
|
$3,503
|
|
$3,189
|
|
9.8
|
|
|
|
|
|
|
|
|
|
Diluted Earnings per
Common Share from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
$1.12
|
|
$1.26
|
|
(11.1)
|
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
0.37
|
|
0.36
|
|
2.8
|
2) 3)
|
|
|
|
|
|
|
|
|
Total
|
|
$1.49
|
|
$1.62
|
|
(8.0)
|
|
|
|
|
|
|
|
|
|
Diluted Earnings per
Common Share, excluding Specified
|
|
|
|
|
|
|
|
Items, as described
below, from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
$1.98
|
|
$1.64
|
|
20.7
|
4)
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
0.30
|
|
0.37
|
|
(18.9)
|
2) 5)
|
|
|
|
|
|
|
|
|
Total
|
|
$2.28
|
|
$2.01
|
|
13.4
|
|
|
|
|
|
|
|
|
|
Average Number of
Common Shares Outstanding
|
|
|
|
|
|
|
|
Plus Dilutive Common
Stock Options and Awards
|
|
1,527
|
|
1,574
|
|
|
|
|
NOTES:
|
|
See tables
below for an explanation of certain non-GAAP financial
information.
|
|
n/m = Percent change
is not meaningful.
|
|
1)
|
Increase over prior
year is a result of specified items, including 2013 favorable
adjustments to tax expense as a result of the resolution of various
tax positions from previous years and for the impact of U.S. tax
law changes enacted in 2013 related to 2012 results, as well as
2014 year-to-date tax expense associated with a one-time
repatriation of 2014 ex-U.S. earnings.
|
|
|
2)
|
Earnings and Diluted
Earnings per Common Share from Discontinued Operations reflect the
reporting of the developed markets branded generics pharmaceuticals
business and Abbott Animal Health due to the pending sale of these
businesses to Mylan and Zoetis respectively.
|
|
|
3)
|
2014 Earnings from
Discontinued Operations, net of taxes, also includes a net
favorable adjustment to tax expense of $166 million, or $0.11 per
share, as a result of the resolution of various tax positions from
previous years related to AbbVie operations.
|
|
|
|
2013 Earnings from
Discontinued Operations, net of taxes, also includes a favorable
adjustment to tax expense of $193 million, or $0.12 per share, as a
result of the resolution of various tax positions from a previous
year related to AbbVie operations.
|
|
|
4)
|
2014 Net Earnings
from Continuing Operations, excluding Specified Items, excludes net
after-tax charges of $1.317 billion, or $0.86 per share, for
intangible amortization expense, expenses associated with cost
reduction initiatives and deal and other expenses related to the
acquisitions, as well as year-to-date tax expense associated with a
one-time repatriation of 2014 ex-U.S. earnings, partially offset by
favorability as a result of the resolution of various tax positions
and adjustment of tax uncertainties from prior years.
|
|
|
|
2013 Net Earnings
from Continuing Operations, excluding Specified Items, excludes
after-tax charges of $609 million, or $0.38 per share, for
intangible amortization expense, expenses associated with cost
reduction initiatives, a philanthropic contribution to the Abbott
Fund, and other costs, including integration and separation-related
costs, partially offset by favorable tax adjustments, as discussed
in note 1.
|
|
|
5)
|
2014 Net Earnings
from Discontinued Operations, excluding Specified Items, excludes a
net favorable adjustment to tax expense of $166 million, or $0.11
per share, related to AbbVie operations, as discussed in note 3,
partially offset by net after-tax charges of $68 million, or $0.04
per share, primarily related to intangible amortization expense and
cost reduction initiatives, as well as year-to-date tax expense
associated with a one-time repatriation of 2014 ex-U.S. earnings,
partially offset by a favorable adjustment to tax expense related
to the resolution of various tax positions from previous
years.
|
|
|
|
2013 Net Earnings
from Discontinued Operations, excluding Specified Items, excludes a
favorable tax adjustment of $193 million, or $0.12 per share,
related to AbbVie operations, as discussed in note 3, partially
offset by net after-tax charges of $197 million, or $0.13 per
share, primarily related to intangible amortization expense and
cost reduction initiatives.
|
Non-GAAP Reconciliation of Financial Information
Abbott Laboratories
and Subsidiaries
|
Non-GAAP
Reconciliation of Financial Information
|
Fourth Quarter Ended
December 31, 2014 and 2013
|
(in millions, except
per share data)
|
(unaudited)
|
|
Reconciliation of
Diluted Earnings per Common Share
|
|
|
|
4Q14
|
|
|
GAAP
|
|
Disc Ops-
AbbVie
|
|
Specified
Items
|
|
As
Adjusted
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
$0.41
|
|
--
|
|
$0.21
|
|
$0.62
|
Discontinued
Operations
|
|
$0.18
|
|
($0.09)
|
|
--
|
|
$0.09
|
Total
|
|
$0.59
|
|
($0.09)
|
|
$0.21
|
|
$0.71
|
Reconciliation of
Financial Information
|
|
|
|
4Q14
|
|
|
As
Reported
(GAAP)
|
|
Disc Ops-
AbbVie
|
|
Specified
Items
|
|
As
Adjusted
|
|
% to
Sales
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
|
|
|
|
|
|
|
|
|
Intangible
Amortization
|
|
$163
|
|
--
|
|
($163)
|
|
--
|
|
|
Gross
Margin
|
|
2,856
|
|
--
|
|
191
|
|
$3,047
|
|
56.9%
|
R&D
|
|
361
|
|
--
|
|
(19)
|
|
342
|
|
6.4%
|
SG&A
|
|
1,666
|
|
--
|
|
(86)
|
|
1,580
|
|
29.5%
|
Net loss on
extinguishment of debt
|
18
|
|
--
|
|
(18)
|
|
--
|
|
|
Other (Income)
Expense, Net
|
|
12
|
|
--
|
|
(1)
|
|
11
|
|
|
Earnings before
taxes
|
|
804
|
|
--
|
|
315
|
|
1,119
|
|
|
Taxes on
Earnings
|
|
170
|
|
--
|
|
6
|
|
176
|
|
|
Net
Earnings
|
|
634
|
|
--
|
|
309
|
|
943
|
|
|
Diluted Earnings per
Share
|
|
$0.41
|
|
--
|
|
$0.21
|
|
$0.62
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
$271
|
|
($129)
|
|
$3
|
|
$145
|
|
|
Diluted Earnings per
Share
|
|
$0.18
|
|
($0.09)
|
|
--
|
|
$0.09
|
|
|
Specified items for continuing operations reflect intangible
amortization expense of $163 million
and other expenses of $152 million,
primarily associated with cost reduction initiatives and deal and
other expenses related to the acquisitions, as well as current
quarter tax expense of $175 million
associated with a one-time repatriation of 2014 ex-U.S. earnings,
partially offset by favorability as a result of the resolution of
various tax positions and adjustment of tax uncertainties from
prior years.
Reconciliation of
Diluted Earnings per Common Share
|
|
|
|
4Q13
|
|
|
Historical
GAAP
|
|
Disc Ops-
EPD DM
& AH
|
|
Historical
GAAP Adj for
Disc Ops
|
|
Specified
Items
|
|
As
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
$0.37
|
|
($0.06)
|
|
$0.31
|
|
$0.17
|
|
$0.48
|
Discontinued
Operations
|
|
--
|
|
$0.06
|
|
$0.06
|
|
$0.04
|
|
$0.10
|
Total
|
|
$0.37
|
|
--
|
|
$0.37
|
|
$0.21
|
|
$0.58
|
Reconciliation of
Financial Information
|
|
|
|
4Q13
|
|
|
Historical
GAAP
|
|
Disc Ops-
EPD DM
& AH
|
|
Historical
GAAP Adj for
Disc Ops
|
|
Specified
Items
|
|
As
Adjusted
|
|
% to
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
Amortization
|
|
$198
|
|
($51)
|
|
$147
|
|
($147)
|
|
--
|
|
|
Gross
Margin
|
|
2,844
|
|
(293)
|
|
2,551
|
|
236
|
|
$2,787
|
|
54.9%
|
R&D
|
|
386
|
|
(23)
|
|
363
|
|
--
|
|
363
|
|
7.2%
|
SG&A
|
|
1,701
|
|
(140)
|
|
1,561
|
|
(73)
|
|
1,488
|
|
29.3%
|
Other (Income)
Expense, Net
|
|
(3)
|
|
--
|
|
(3)
|
|
(17)
|
|
(20)
|
|
|
Earnings before
taxes
|
|
737
|
|
(131)
|
|
606
|
|
326
|
|
932
|
|
|
Taxes on
Earnings
|
|
148
|
|
(25)
|
|
123
|
|
55
|
|
178
|
|
|
Net
Earnings
|
|
589
|
|
(106)
|
|
483
|
|
271
|
|
754
|
|
|
Diluted Earnings per
Share
|
|
$0.37
|
|
($0.06)
|
|
$0.31
|
|
$0.17
|
|
$0.48
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
--
|
|
$106
|
|
$106
|
|
$58
|
|
$164
|
|
|
Diluted Earnings per
Share
|
|
--
|
|
$0.06
|
|
$0.06
|
|
$0.04
|
|
$0.10
|
|
|
Specified items for continuing operations reflect intangible
amortization expense of $147 million
and other expenses of $179 million,
primarily associated with cost reduction initiatives, integration
and separation-related costs.
Specified items for discontinued operations are primarily
related to intangible amortization expense and cost reduction
initiatives.
Abbott Laboratories
and Subsidiaries
|
Non-GAAP
Reconciliation of Financial Information
|
Fiscal Year Ended
December 31, 2014 and 2013
|
(in millions, except
per share data)
|
(unaudited)
|
|
Reconciliation of
Diluted Earnings per Common Share
|
|
|
|
12M14
|
|
|
GAAP
|
|
Disc Ops-
AbbVie
|
|
Specified
Items
|
|
As
Adjusted
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
$1.12
|
|
--
|
|
$0.86
|
|
$1.98
|
Discontinued
Operations
|
|
$0.37
|
|
($0.11)
|
|
$0.04
|
|
$0.30
|
Total
|
|
$1.49
|
|
($0.11)
|
|
$0.90
|
|
$2.28
|
Reconciliation of
Financial Information
|
|
|
|
12M14
|
|
|
As
Reported
(GAAP)
|
|
Disc Ops-
AbbVie
|
|
Specified
Items
|
|
As
Adjusted
|
|
% to
Sales
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
|
|
|
|
|
|
|
|
|
Intangible
Amortization
|
|
$555
|
|
--
|
|
($555)
|
|
--
|
|
|
Gross
Margin
|
|
10,474
|
|
--
|
|
721
|
|
$11,195
|
|
55.3%
|
R&D
|
|
1,345
|
|
--
|
|
(72)
|
|
1,273
|
|
6.3%
|
SG&A
|
|
6,530
|
|
--
|
|
(367)
|
|
6,163
|
|
30.4%
|
Net loss on
extinguishment of debt
|
18
|
|
--
|
|
(18)
|
|
--
|
|
|
Other (Income)
Expense, Net
|
|
14
|
|
--
|
|
(9)
|
|
5
|
|
|
Earnings before
taxes
|
|
2,518
|
|
--
|
|
1,187
|
|
3,705
|
|
|
Taxes on
Earnings
|
|
797
|
|
--
|
|
(130)
|
|
667
|
|
|
Net
Earnings
|
|
1,721
|
|
--
|
|
1,317
|
|
3,038
|
|
|
Diluted Earnings per
Share
|
|
$1.12
|
|
--
|
|
$0.86
|
|
$1.98
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
$563
|
|
($166)
|
|
$68
|
|
$465
|
|
|
Diluted Earnings per
Share
|
|
$0.37
|
|
($0.11)
|
|
$0.04
|
|
$0.30
|
|
|
Specified items for continuing operations reflect intangible
amortization expense of $555 million
and other expenses of $632 million,
primarily associated with cost reduction initiatives and deal and
other expenses related to the acquisitions, as well as year-to-date
tax expense of $440 million
associated with a one-time repatriation of 2014 ex-U.S. earnings,
partially offset by favorability as a result of the resolution of
various tax positions and adjustment of tax uncertainties from
prior years.
Specified items for discontinued operations are primarily
related to intangible amortization expense, cost reduction
initiatives, as well as year-to-date tax expense associated with a
one-time repatriation of 2014 ex-U.S. earnings, partially offset by
a favorable adjustment to tax expense related to the resolution of
various tax positions from previous years.
Reconciliation of
Diluted Earnings per Common Share
|
|
|
|
12M13
|
|
|
Historical
GAAP
|
|
Disc Ops-
EPD DM
& AH
|
|
Historical
GAAP Adj for
Disc Ops
|
|
Disc Ops-
AbbVie
|
|
Specified
Items
|
|
As
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
$1.50
|
|
($0.24)
|
|
$1.26
|
|
--
|
|
$0.38
|
|
$1.64
|
Discontinued
Operations
|
|
$0.12
|
|
$0.24
|
|
$0.36
|
|
($0.12)
|
|
$0.13
|
|
$0.37
|
Total
|
|
$1.62
|
|
--
|
|
$1.62
|
|
($0.12)
|
|
$0.51
|
|
$2.01
|
Reconciliation of
Financial Information
|
|
|
|
12M13
|
|
|
Historical
GAAP
|
|
Disc Ops-
EPD DM
& AH
|
|
Historical
GAAP Adj
for Disc Ops
|
|
Disc Ops-
AbbVie
|
|
Specified
Items
|
|
As
Adjusted
|
|
% to
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
Amortization
|
|
$791
|
|
($203)
|
|
$588
|
|
--
|
|
($588)
|
|
--
|
|
|
Gross
Margin
|
|
11,017
|
|
(1,141)
|
|
9,876
|
|
--
|
|
892
|
|
$10,768
|
|
54.8%
|
R&D
|
|
1,452
|
|
(81)
|
|
1,371
|
|
--
|
|
(16)
|
|
1,355
|
|
6.9%
|
SG&A
|
|
6,936
|
|
(564)
|
|
6,372
|
|
--
|
|
(228)
|
|
6,144
|
|
31.3%
|
Net Foreign
Exchange
(Gain) Loss
|
|
50
|
|
(4)
|
|
46
|
|
--
|
|
(15)
|
|
31
|
|
|
Other (Income)
Expense, Net
|
(32)
|
|
--
|
|
(32)
|
|
--
|
|
(20)
|
|
(52)
|
|
|
Earnings before
taxes
|
|
2,521
|
|
(480)
|
|
2,041
|
|
--
|
|
1,171
|
|
3,212
|
|
|
Taxes on
Earnings
|
|
138
|
|
(85)
|
|
53
|
|
--
|
|
562
|
|
615
|
|
|
Net
Earnings
|
|
2,383
|
|
(395)
|
|
1,988
|
|
--
|
|
609
|
|
2,597
|
|
|
Diluted Earnings per
Share
|
|
$1.50
|
|
($0.24)
|
|
$1.26
|
|
--
|
|
$0.38
|
|
$1.64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
$193
|
|
$395
|
|
$588
|
|
($193)
|
|
$197
|
|
$592
|
|
|
Diluted Earnings per
Share
|
|
$0.12
|
|
$0.24
|
|
$0.36
|
|
($0.12)
|
|
$0.13
|
|
$0.37
|
|
|
Specified items for continuing operations reflect intangible
amortization expense of $588 million
and other expenses of $583 million,
primarily associated with cost reduction initiatives, a
philanthropic contribution to the Abbott Fund, and integration and
separation-related costs, partially offset by favorable adjustments
to tax expense of $230 million
related to the resolution of various tax positions from previous
years and $103 million for the impact
of U.S. tax law changes enacted in 2013 related to 2012
results.
Specified items for discontinued operations are primarily
related to intangible amortization expense and cost reduction
initiatives.
Reconciliation of Tax Rate for Continuing Operations
A reconciliation of the fourth-quarter tax rates for continuing
operations for 2014 and 2013 is shown below:
|
|
|
4Q14
|
|
(dollars in
millions)
|
|
Pre-Tax
Income
|
|
Taxes on
Earnings
|
|
Tax
Rate
|
|
As reported
(GAAP)
|
|
$804
|
|
$170
|
|
21.1%
|
|
Specified
items
|
|
315
|
|
6
|
|
|
1)
|
Excluding
specified items
|
|
$1,119
|
|
$176
|
|
15.7%
|
2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q13
|
|
(dollars in
millions)
|
|
Pre-Tax
Income
|
|
Taxes on
Earnings
|
|
Tax
Rate
|
|
As reported
(GAAP)
|
|
$606
|
|
$123
|
|
20.3%
|
|
Specified
items
|
|
326
|
|
55
|
|
|
|
Excluding
specified items
|
|
$932
|
|
$178
|
|
19.1%
|
|
|
|
1)
|
Specified items
include current quarter tax expense of $175 million associated with
a one-time repatriation of 2014 ex-U.S. earnings, partially offset
by favorability of $133 million as a result of the resolution of
various tax positions and adjustment of tax uncertainties from
prior years.
|
|
|
2)
|
Fourth-quarter tax
rate, excluding specified items, includes the year-to-date impact
of U.S. tax legislation passed in Dec. 2014, including the R&D
tax credit. Excluding the impact of specified items and U.S. tax
legislation, the fourth-quarter tax rate is 19 percent.
|
A reconciliation of the full-year tax rates for continuing
operations for 2014 and 2013 is shown below:
|
|
|
12M14
|
|
(dollars in
millions)
|
|
Pre-Tax
Income
|
|
Taxes on
Earnings
|
|
Tax
Rate
|
|
As reported
(GAAP)
|
|
$2,518
|
|
$797
|
|
31.7%
|
|
Specified
items
|
|
1,187
|
|
(130)
|
|
|
3)
|
Excluding
specified items
|
|
$3,705
|
|
$667
|
|
18.0%
|
4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12M13
|
|
(dollars in
millions)
|
|
Pre-Tax
Income
|
|
Taxes on
Earnings
|
|
Tax
Rate
|
|
As reported
(GAAP)
|
|
$2,041
|
|
$53
|
|
2.6%
|
|
Specified
items
|
|
1,171
|
|
562
|
|
|
5)
|
Excluding
specified items
|
|
$3,212
|
|
$615
|
|
19.1%
|
|
|
|
3)
|
Specified items
include year-to-date tax expense of $440 million associated with a
one-time repatriation of 2014 ex-U.S. earnings, partially offset by
favorability of $126 million as a result of the resolution of
various tax positions and adjustment of tax uncertainties from
prior years.
|
|
|
4)
|
Excluding the impact
of specified items and U.S. tax legislation, as discussed in note
2, the full-year tax rate is 19 percent.
|
|
|
5)
|
Specified items
include favorable adjustments to tax expense of $230 million
related to the resolution of various tax positions from previous
years and $103 million for the impact of U.S. tax law changes
enacted in 2013 related to 2012 results.
|
Additional Financial Information
Reconciliation of the
Reported 2014 Sales between Continuing and Discontinued
Operations
|
($ in
millions)
|
|
|
|
2014
Sales
|
|
|
Total Sales,
Incl.
Discontinued Operations
|
|
Discontinued
Operations
|
|
Continuing
Operations
|
|
|
$
|
Operational %
Change vs. PY
|
|
$
|
|
$
|
Operational %
Change vs. PY
|
|
|
|
|
|
|
|
|
|
1Q14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
5,244
|
0.5
|
|
(489)
|
|
4,755
|
1.2
|
U.S.
|
|
1,489
|
(2.9)
|
|
(15)
|
|
1,474
|
(3.0)
|
International
|
|
3,755
|
1.8
|
|
(474)
|
|
3,281
|
3.1
|
|
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
1,151
|
(0.7)
|
|
(470)
|
|
681
|
3.6
|
|
|
|
|
|
|
|
|
|
2Q14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
5,551
|
3.0
|
|
(494)
|
|
5,057
|
3.8
|
U.S.
|
|
1,561
|
0.1
|
|
(17)
|
|
1,544
|
--
|
International
|
|
3,990
|
4.2
|
|
(477)
|
|
3,513
|
5.6
|
|
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
1,216
|
2.3
|
|
(472)
|
|
744
|
7.5
|
|
|
|
|
|
|
|
|
|
3Q14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
5,623
|
5.6
|
|
(544)
|
|
5,079
|
6.6
|
U.S.
|
|
1,577
|
(0.6)
|
|
(20)
|
|
1,557
|
(0.9)
|
International
|
|
4,046
|
8.3
|
|
(524)
|
|
3,522
|
10.3
|
|
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
1,290
|
5.7
|
|
(519)
|
|
771
|
12.9
|
|
|
|
|
|
|
|
|
|
4Q14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
5,906
|
9.4
|
|
(550)
|
|
5,356
|
10.2
|
U.S.
|
|
1,572
|
(1.1)
|
|
(24)
|
|
1,548
|
(1.7)
|
International
|
|
4,334
|
13.6
|
|
(526)
|
|
3,808
|
15.6
|
|
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
1,444
|
20.7
|
|
(522)
|
|
922
|
35.4
|
|
|
|
|
|
|
|
|
|
Full Year
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
22,324
|
4.8
|
|
(2,077)
|
|
20,247
|
5.5
|
U.S.
|
|
6,199
|
(1.1)
|
|
(76)
|
|
6,123
|
(1.4)
|
International
|
|
16,125
|
7.0
|
|
(2,001)
|
|
14,124
|
8.7
|
|
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
5,101
|
7.2
|
|
(1,983)
|
|
3,118
|
14.9
|
Reconciliation of the
Reported 2013 Sales between Continuing and Discontinued
Operations
|
($ in
millions)
|
|
|
|
2013
Sales
|
|
|
Total Sales,
Incl.
Discontinued
Operations
|
|
Discontinued
Operations
|
|
Continuing
Operations
|
|
|
|
|
|
|
|
1Q13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
5,378
|
|
(531)
|
|
4,847
|
U.S.
|
|
1,534
|
|
(14)
|
|
1,520
|
International
|
|
3,844
|
|
(517)
|
|
3,327
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
|
1,233
|
|
(515)
|
|
718
|
|
|
|
|
|
|
|
2Q13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
5,446
|
|
(513)
|
|
4,933
|
U.S.
|
|
1,560
|
|
(16)
|
|
1,544
|
International
|
|
3,886
|
|
(497)
|
|
3,389
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
|
1,218
|
|
(491)
|
|
727
|
|
|
|
|
|
|
|
3Q13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
5,369
|
|
(564)
|
|
4,805
|
U.S.
|
|
1,587
|
|
(16)
|
|
1,571
|
International
|
|
3,782
|
|
(548)
|
|
3,234
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
|
1,235
|
|
(544)
|
|
691
|
|
|
|
|
|
|
|
4Q13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
5,655
|
|
(583)
|
|
5,072
|
U.S.
|
|
1,588
|
|
(15)
|
|
1,573
|
International
|
|
4,067
|
|
(568)
|
|
3,499
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
|
1,288
|
|
(562)
|
|
726
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Full Year
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
21,848
|
|
(2,191)
|
|
19,657
|
U.S.
|
|
6,269
|
|
(61)
|
|
6,208
|
International
|
|
15,579
|
|
(2,130)
|
|
13,449
|
|
|
|
|
|
|
|
Established
Pharmaceuticals
|
|
4,974
|
|
(2,112)
|
|
2,862
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/abbott-reports-fourth-quarter-2014-results-300027722.html
SOURCE Abbott