Abbott Reports First-Quarter 2023 Results; Increases Outlook For Underlying Base Business
- Sales of $9.7 billion driven by strong underlying base business performance
- Reported sales decreased 18.1 percent due to anticipated decline in COVID-19 testing-related sales versus prior year
- Organic sales growth for underlying base business of 10.0 percent, led by Medical Devices, Established Pharmaceuticals and Nutrition
ABBOTT PARK, Ill., April 19, 2023 /PRNewswire/ -- Abbott (NYSE: ABT) today announced financial results for the first quarter ended March 31, 2023.
- First-quarter GAAP diluted EPS of $0.75 and adjusted diluted EPS of $1.03, which excludes specified items.
- Projected full-year 2023 diluted EPS from continuing operations on a GAAP basis of $3.05 to $3.25 remains unchanged.
- Projected full-year adjusted EPS from continuing operations of $4.30 to $4.50 remains unchanged and now reflects an increased outlook for the underlying base business offset by a lower forecasted earnings contribution from COVID-19 testing-related sales.
- Abbott now projects full-year 2023 organic sales growth, excluding COVID-19 testing-related sales1, of at least high single-digits2 and COVID-19 testing-related sales of approximately $1.5 billion.
- In January, Abbott announced U.S. Food and Drug Administration (FDA) approval of Navitor®, its second-generation transcatheter aortic valve implantation system, for people with severe aortic stenosis who are at high risk for surgery.
- In March, data was presented at the American College of Cardiology Scientific Sessions showing Abbott's TriClip® system was superior to current medical therapy in treating patients with severe tricuspid regurgitation, or a leaky tricuspid heart valve.
- In March, Abbott's market-leading FreeStyle Libre® continuous glucose monitoring system received U.S. FDA clearance for integration with automated insulin delivery systems. Abbott is partnering with leading insulin pump manufacturers to integrate their systems with FreeStyle Libre 2 and FreeStyle Libre 3 as soon as possible.
"Our first-quarter results reflect a very strong start to the year," said Robert B. Ford, chairman and chief executive officer, Abbott. "Growth in our underlying base businesses accelerated, including particularly strong results in Medical Devices, Established Pharmaceuticals and Nutrition."
FIRST-QUARTER BUSINESS OVERVIEW
Management believes that measuring sales growth rates on an organic basis, which excludes the impact of foreign exchange, as well as the impact of exiting the pediatric nutrition business in China, is an appropriate way for investors to best understand the core underlying performance of the business.
Management further believes that measuring sales growth rates on an organic basis excluding COVID-19 tests is an appropriate way for investors to best understand underlying base business performance as the COVID-19 pandemic shifts to an endemic state, resulting in significantly lower expected demand for COVID-19 tests.
Note: In order to compute results excluding the impact of exchange rates, current year U.S. dollar sales are multiplied or divided, as appropriate, by the current year average foreign exchange rates and then those amounts are multiplied or divided, as appropriate, by the prior year average foreign exchange rates.
Total Company | |||||||||
Reported Sales | |||||||||
Sales 1Q23 ($ in millions) | Total Company | Nutrition | Diagnostics | Established | Medical Devices | ||||
U.S. | 3,928 | 812 | 1,335 | — | 1,778 | ||||
International | 5,819 | 1,155 | 1,353 | 1,189 | 2,122 | ||||
Total reported | 9,747 | 1,967 | 2,688 | 1,189 | 3,900 | ||||
% Change vs. 1Q22 | |||||||||
U.S. | (20.4) | 19.9 | (50.8) | n/a | 15.1 | ||||
International | (16.4) | (5.1) | (46.9) | 3.7 | 3.5 | ||||
Total reported | (18.1) | 3.8 | (48.9) | 3.7 | 8.5 | ||||
Organic Sales | |||||||||
% Change vs. 1Q22 | Total Company | Nutrition | Diagnostics | Established | Medical Devices | ||||
Reported | (18.1) | 3.8 | (48.9) | 3.7 | 8.5 | ||||
Impact of foreign exchange | (3.3) | (3.9) | (1.8) | (7.4) | (3.9) | ||||
Impact of business exit | (0.3) | (2.6) | — | — | — | ||||
Organic | (14.5) | 10.3 | (47.1) | 11.1 | 12.4 | ||||
Impact of COVID-19 testing sales3 | (24.5) | — | (51.5) | — | — | ||||
Organic excluding COVID-19 tests | 10.0 | 10.3 | 4.4 | 11.1 | 12.4 | ||||
U.S. | 12.6 | 19.9 | 0.3 | n/a | 15.1 | ||||
International | 8.6 | 4.8 | 6.8 | 11.1 | 10.4 | ||||
n/a = Not Applicable. |
Refer to table titled "Non-GAAP Revenue Reconciliation" for a reconciliation of adjusted historical revenue to reported revenue.
Nutrition | |||||||
Reported Sales | |||||||
Sales 1Q23 ($ in millions) | Total | Pediatric | Adult | ||||
U.S. | 812 | 459 | 353 | ||||
International | 1,155 | 465 | 690 | ||||
Total reported | 1,967 | 924 | 1,043 | ||||
% Change vs. 1Q22 | |||||||
U.S. | 19.9 | 36.1 | 3.9 | ||||
International | (5.1) | (8.6) | (2.6) | ||||
Total reported | 3.8 | 9.2 | (0.5) | ||||
Organic Sales | |||||||
% Change vs. 1Q22 | Total | Pediatric | Adult | ||||
Reported | 3.8 | 9.2 | (0.5) | ||||
Impact of foreign exchange | (3.9) | (2.8) | (4.7) | ||||
Impact of business exit | (2.6) | (6.4) | — | ||||
Organic | 10.3 | 18.4 | 4.2 | ||||
U.S. | 19.9 | 36.1 | 3.9 | ||||
International | 4.8 | 5.3 | 4.4 | ||||
Worldwide Nutrition sales increased 3.8 percent on a reported basis and 10.3 percent on an organic basis in the first quarter. Refer to table titled "Non-GAAP Revenue Reconciliation" for a reconciliation of adjusted historical revenue to reported revenue.
In Pediatric Nutrition, global sales increased 9.2 percent on a reported basis and 18.4 percent on an organic basis. In the U.S., sales growth of 36.1 percent includes the impact of lower sales in the first quarter of the prior year due to a voluntary recall of certain infant formula products. Following a temporary manufacturing stoppage of these products, Abbott subsequently restarted production last year and continues to make good progress recovering market share in this business.
In Adult Nutrition, global sales decreased 0.5 percent on a reported basis and increased 4.2 percent on an organic basis, which was led by strong global growth of Ensure®, Abbott's market-leading complete and balanced nutrition brand.
Diagnostics | |||||||||
Reported Sales | |||||||||
Sales 1Q23 ($ in millions) | Total | Core Laboratory | Molecular | Point of Care | Rapid | ||||
U.S. | 1,335 | 289 | 47 | 93 | 906 | ||||
International | 1,353 | 893 | 100 | 41 | 319 | ||||
Total reported | 2,688 | 1,182 | 147 | 134 | 1,225 | ||||
% Change vs. 1Q22 | |||||||||
U.S. | (50.8) | 7.7 | (72.7) | 2.9 | (58.4) | ||||
International | (46.9) | (2.5) | (59.7) | 9.2 | (76.3) | ||||
Total reported | (48.9) | (0.2) | (65.0) | 4.7 | (65.3) | ||||
Organic Sales | |||||||||
% Change vs. 1Q22 | Total | Core Laboratory | Molecular | Point of Care | Rapid | ||||
Reported | (48.9) | (0.2) | (65.0) | 4.7 | (65.3) | ||||
Impact of foreign exchange | (1.8) | (5.3) | (1.0) | (1.0) | (0.8) | ||||
Organic | (47.1) | 5.1 | (64.0) | 5.7 | (64.5) | ||||
Impact of COVID-19 testing sales3 | (51.5) | (2.0) | (39.2) | — | (72.5) | ||||
Organic excluding COVID-19 tests | 4.4 | 7.1 | (24.8) | 5.7 | 8.0 | ||||
U.S. | 0.3 | 9.0 | (36.7) | 2.9 | (0.9) | ||||
International | 6.8 | 6.5 | (18.9) | 12.7 | 23.2 | ||||
*The Acelis Connected Health business was internally transferred from Rapid Diagnostics to Heart Failure on January 1, 2023. As a result, $29 million of sales for the first quarter of 2022 were moved from Rapid Diagnostics to Heart Failure. |
As expected, Diagnostics sales growth in the first quarter was negatively impacted by year-over-year declines in COVID-19 testing-related sales3. Worldwide COVID-19 testing sales were $730 million in the first quarter of 2023 compared to $3.304 billion in the first quarter of the prior year.
Excluding COVID-19 testing-related sales, global Diagnostics sales increased 0.2 percent on a reported basis and increased 4.4 percent on an organic basis. Organic sales growth, excluding COVID-19 testing-related sales, was led by Core Laboratory, Point of Care and Rapid Diagnostics. In Molecular Diagnostics, growth was negatively impacted by lower demand for seasonal respiratory testing compared to significantly higher-than-usual demand in the first quarter of the prior year.
Established Pharmaceuticals | ||||||||
Reported Sales | ||||||||
Sales 1Q23 ($ in millions) | Total | Key Emerging | Other | |||||
U.S. | — | — | — | |||||
International | 1,189 | 912 | 277 | |||||
Total reported | 1,189 | 912 | 277 | |||||
% Change vs. 1Q22 | ||||||||
U.S. | n/a | n/a | n/a | |||||
International | 3.7 | 0.7 | 15.0 | |||||
Total reported | 3.7 | 0.7 | 15.0 | |||||
Organic Sales | ||||||||
% Change vs. 1Q22 | Total | Key Emerging | Other | |||||
Reported | 3.7 | 0.7 | 15.0 | |||||
Impact of foreign exchange | (7.4) | (7.6) | (6.8) | |||||
Organic | 11.1 | 8.3 | 21.8 | |||||
U.S. | n/a | n/a | n/a | |||||
International | 11.1 | 8.3 | 21.8 | |||||
Established Pharmaceuticals sales increased 3.7 percent on a reported basis and 11.1 percent on an organic basis in the first quarter.
Key Emerging Markets include several emerging countries that represent the most attractive long-term growth opportunities for Abbott's branded generics product portfolio. Sales in these geographies increased 0.7 percent on a reported basis and 8.3 percent on an organic basis, led by growth in Brazil, China and Southeast Asia, and across several therapeutic areas, including cardiometabolic, respiratory and central nervous system/pain management.
Medical Devices | |||||||||||||||
Reported Sales | |||||||||||||||
Sales 1Q23 ($ in millions) | Total | Rhythm | Electro- physiology | Heart | Vascular | Structural | Neuro- | Diabetes | |||||||
U.S. | 1,778 | 260 | 238 | 218 | 218 | 210 | 155 | 479 | |||||||
International | 2,122 | 267 | 267 | 63 | 399 | 251 | 41 | 834 | |||||||
Total reported | 3,900 | 527 | 505 | 281 | 617 | 461 | 196 | 1,313 | |||||||
% Change vs. 1Q22 | |||||||||||||||
U.S. | 15.1 | 4.4 | 10.0 | 11.3 | 4.8 | 10.5 | 8.4 | 39.7 | |||||||
International | 3.5 | (3.2) | (1.0) | 16.6 | (2.7) | 13.7 | 13.5 | 6.5 | |||||||
Total reported | 8.5 | 0.4 | 3.9 | 12.4 | (0.2) | 12.2 | 9.4 | 16.6 | |||||||
Organic Sales | |||||||||||||||
% Change vs. 1Q22 | Total | Rhythm | Electro- physiology | Heart | Vascular | Structural | Neuro- | Diabetes | |||||||
Reported | 8.5 | 0.4 | 3.9 | 12.4 | (0.2) | 12.2 | 9.4 | 16.6 | |||||||
Impact of foreign exchange | (3.9) | (3.6) | (4.9) | (1.2) | (4.1) | (4.2) | (1.8) | (4.4) | |||||||
Organic | 12.4 | 4.0 | 8.8 | 13.6 | 3.9 | 16.4 | 11.2 | 21.0 | |||||||
U.S. | 15.1 | 4.4 | 10.0 | 11.3 | 4.8 | 10.5 | 8.4 | 39.7 | |||||||
International | 10.4 | 3.7 | 7.8 | 22.3 | 3.4 | 21.4 | 22.5 | 12.9 | |||||||
*The Acelis Connected Health business was internally transferred from Rapid Diagnostics to Heart Failure on January 1, 2023. As a result, $29 million of sales for the first quarter of 2022 were moved from Rapid Diagnostics to Heart Failure. |
Worldwide Medical Devices sales increased 8.5 percent on a reported basis and 12.4 percent on an organic basis in the first quarter, including double-digit organic sales growth in both the U.S. and internationally.
Sales growth was led by double-digit organic growth in Diabetes Care, Structural Heart, Heart Failure and Neuromodulation. Several recently launched products and new indications contributed to the strong performance, including Amplatzer® Amulet®, Navitor, TriClip, Aveir® and CardioMEMS®.
In Electrophysiology, internationally, sales grew double-digits on a reported basis and high-teens on an organic basis in Europe, which was partially offset by soft market conditions in China during the first several weeks of the first quarter.
In Diabetes Care, FreeStyle Libre sales were $1.2 billion, which included U.S. growth of approximately 50 percent.
ABBOTT'S EARNINGS-PER-SHARE GUIDANCE
Abbott projects full-year 2023 diluted earnings per share from continuing operations under GAAP of $3.05 to $3.25. Abbott forecasts specified items for the full-year 2023 of $1.25 per share primarily related to intangible amortization, restructuring and cost reduction initiatives and other net expenses. Excluding specified items, projected adjusted diluted earnings per share from continuing operations would be $4.30 to $4.50 for the full-year 2023.
ABBOTT DECLARES 397TH CONSECUTIVE QUARTERLY DIVIDEND
On February 17, 2023, the board of directors of Abbott declared the company's quarterly dividend of $0.51 per share. Abbott's cash dividend is payable May 15, 2023, to shareholders of record at the close of business on April 14, 2023.
Abbott has increased its dividend payout for 51 consecutive years and is a member of the S&P 500 Dividend Aristocrats Index, which tracks companies that have annually increased their dividend for at least 25 consecutive years.
About Abbott:
Abbott is a global healthcare leader that helps people live more fully at all stages of life. Our portfolio of life-changing technologies spans the spectrum of healthcare, with leading businesses and products in diagnostics, medical devices, nutritionals and branded generic medicines. Our 115,000 colleagues serve people in more than 160 countries.
Connect with us at www.abbott.com, on LinkedIn at www.linkedin.com/company/abbott-/, on Facebook at www.facebook.com/Abbott and on Twitter @AbbottNews.
Abbott will live-webcast its first-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 webcast will be available later in the day.
— 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" in our Annual Report on Form 10-K for the year ended Dec. 31, 2022, and are incorporated herein 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.
1 | For the full-year 2022, COVID-19 testing-related sales were $8.368 billion and total worldwide sales were $43.653 billion. |
2 | Abbott has not provided the related GAAP financial measure for organic sales growth, excluding COVID-19 testing-related sales, on a forward-looking basis because the company is unable to predict the impact of foreign exchange due to the unpredictability of future changes in foreign exchange rates, which could significantly impact reported sales growth. |
3 | Diagnostic sales and COVID-19 testing-related sales in 2023 and 2022 are summarized below: |
Sales 1Q23 | COVID Tests Sales 1Q23 | |||||||||||||||||
($ in millions) | U.S. | Int'l | Total | U.S. | Int'l | Total | ||||||||||||
Total Diagnostics | 1,335 | 1,353 | 2,688 | 608 | 122 | 730 | ||||||||||||
Core Laboratory | 289 | 893 | 1,182 | 2 | 4 | 6 | ||||||||||||
Molecular | 47 | 100 | 147 | 10 | 10 | 20 | ||||||||||||
Rapid Diagnostics | 906 | 319 | 1,225 | 596 | 108 | 704 | ||||||||||||
Sales 1Q22 | COVID Tests Sales 1Q22 | |||||||||||||||||
($ in millions) | U.S. | Int'l | Total | U.S. | Int'l | Total | ||||||||||||
Total Diagnostics | 2,712 | 2,545 | 5,257 | 1,988 | 1,316 | 3,304 | ||||||||||||
Core Laboratory | 268 | 916 | 1,184 | 5 | 23 | 28 | ||||||||||||
Molecular | 172 | 248 | 420 | 114 | 132 | 246 | ||||||||||||
Rapid Diagnostics | 2,181 | 1,344 | 3,525 | 1,869 | 1,161 | 3,030 | ||||||||||||
Abbott Laboratories and Subsidiaries Condensed Consolidated Statement of Earnings First Quarter Ended March 31, 2023 and 2022 (in millions, except per share data) (unaudited) | ||||||
1Q23 | 1Q22 | % Change | ||||
Net Sales | $9,747 | $11,895 | (18.1) | |||
Cost of products sold, excluding amortization expense | 4,331 | 4,987 | (13.2) | |||
Amortization of intangible assets | 491 | 512 | (4.0) | |||
Research and development | 654 | 697 | (6.2) | |||
Selling, general, and administrative | 2,762 | 2,787 | (0.9) | |||
Total Operating Cost and Expenses | 8,238 | 8,983 | (8.3) | |||
Operating Earnings | 1,509 | 2,912 | (48.2) | |||
Interest expense, net | 52 | 117 | (56.1) | |||
Net foreign exchange (gain) loss | 6 | (3) | n/m | |||
Other (income) expense, net | (111) | (78) | 41.5 | |||
Earnings before taxes | 1,562 | 2,876 | (45.7) | |||
Taxes on earnings | 244 | 429 | (43.0) | 1) | ||
Net Earnings | $1,318 | $2,447 | (46.1) | |||
Net Earnings excluding Specified Items, as described below | $1,815 | $3,077 | (41.0) | 2) | ||
Diluted Earnings per Common Share | $0.75 | $1.37 | (45.3) | |||
Diluted Earnings per Common Share, excluding Specified Items, as described below | $1.03 | $1.73 | (40.5) | 2) | ||
Average Number of Common Shares Outstanding Plus Dilutive Common Stock Options | 1,752 | 1,775 | ||||
NOTES: | |
See tables tables titled "Non-GAAP Reconciliation of Financial Information" for an explanation of certain non-GAAP financial information. | |
n/m = Percent change is not meaningful. | |
See footnotes below. | |
1) | 2023 Taxes on Earnings includes the recognition of approximately $22 million of net tax expense as a result of the resolution of various tax positions related to prior years. |
2022 Taxes on Earnings includes the recognition of approximately $30 million of net tax expense as a result of the resolution of various tax positions related to prior years and approximately $30 million in excess tax benefits associated with share-based compensation. | |
2) | 2023 Net Earnings and Diluted Earnings per Common Share, excluding Specified Items, excludes net after-tax charges of $497 million, or $0.28 per share, for intangible amortization, charges related to restructuring and cost reduction initiatives, expenses associated with acquisitions and other net expenses. |
2022 Net Earnings and Diluted Earnings per Common Share, excluding Specified Items, excludes net after-tax charges of $630 million, or $0.36 per share, for intangible amortization, charges related to a voluntary recall and other net expenses primarily associated with acquisitions. | |
Abbott Laboratories and Subsidiaries Non-GAAP Reconciliation of Financial Information First Quarter Ended March 31, 2023 and 2022 (in millions, except per share data) (unaudited) | ||||||||
1Q23 | ||||||||
As Reported | Specified | As Adjusted | ||||||
Intangible Amortization | $ 491 | $ (491) | $ — | |||||
Gross Margin | 4,925 | 520 | 5,445 | |||||
R&D | 654 | (26) | 628 | |||||
SG&A | 2,762 | (2) | 2,760 | |||||
Earnings before taxes | 1,562 | 548 | 2,110 | |||||
Taxes on Earnings | 244 | 51 | 295 | |||||
Net Earnings | 1,318 | 497 | 1,815 | |||||
Diluted Earnings per Share | $ 0.75 | $ 0.28 | $ 1.03 | |||||
Specified items reflect intangible amortization expense of $491 million and other net expenses of $57 million associated with restructuring actions, costs associated with acquisitions and other expenses. See table titled "Details of Specified Items First Quarter Ended March 31, 2023" for additional details regarding specified items. |
1Q22 | ||||||||
As Reported | Specified | As Adjusted | ||||||
Intangible Amortization | $ 512 | $ (512) | $ — | |||||
Gross Margin | 6,396 | 636 | 7,032 | |||||
R&D | 697 | (33) | 664 | |||||
SG&A | 2,787 | (39) | 2,748 | |||||
Other (income) expense, net | (78) | (15) | (93) | |||||
Earnings before taxes | 2,876 | 723 | 3,599 | |||||
Taxes on Earnings | 429 | 93 | 522 | |||||
Net Earnings | 2,447 | 630 | 3,077 | |||||
Diluted Earnings per Share | $ 1.37 | $ 0.36 | $ 1.73 | |||||
Specified items reflect intangible amortization expense of $512 million and other net expenses of $211 million that includes costs associated with a product recall, acquisitions and other net expenses. See table titled "Details of Specified Items First Quarter Ended March 31, 2022" for additional details regarding specified items. |
A reconciliation of the first-quarter tax rates for 2023 and 2022 is shown below: | ||||||||||
1Q23 | ||||||||||
($ in millions) | Pre-Tax Income | Taxes on Earnings | Tax Rate | |||||||
As reported (GAAP) | $ 1,562 | $ 244 | 15.6 % | 1) | ||||||
Specified items | 548 | 51 | ||||||||
Excluding specified items | $ 2,110 | $ 295 | 14.0 % | |||||||
1Q22 | ||||||||||
($ in millions) | Pre-Tax Income | Taxes on Earnings | Tax Rate | |||||||
As reported (GAAP) | $ 2,876 | $ 429 | 14.9 % | 2) | ||||||
Specified items | 723 | 93 | ||||||||
Excluding specified items | $ 3,599 | $ 522 | 14.5 % | |||||||
1) | 2023 Taxes on Earnings includes the recognition of approximately $22 million of net tax expense as a result of the resolution of various tax positions related to prior years. |
2) | 2022 Taxes on Earnings includes the recognition of approximately $30 million of net tax expense as a result of the resolution of various tax positions related to prior years and approximately $30 million in excess tax benefits associated with share-based compensation. |
Abbott Laboratories and Subsidiaries Non-GAAP Revenue Reconciliation First Quarter Ended March 31, 2023 and 2022 ($ in millions) (unaudited) | |||||||||||||
1Q23 | 1Q22 | % Change vs. 1Q22 | |||||||||||
Non-GAAP | |||||||||||||
Abbott | Impact from | Adjusted | Abbott | Impact from | Adjusted | Reported | Adjusted | Organic | |||||
Total Company | 9,747 | (8) | 9,739 | 11,895 | (52) | 11,843 | (18.1) | (17.8) | (14.5) | ||||
U.S. | 3,928 | — | 3,928 | 4,937 | — | 4,937 | (20.4) | (20.4) | (20.4) | ||||
Intl | 5,819 | (8) | 5,811 | 6,958 | (52) | 6,906 | (16.4) | (15.9) | (10.2) | ||||
Total Nutrition | 1,967 | (8) | 1,959 | 1,894 | (52) | 1,842 | 3.8 | 6.4 | 10.3 | ||||
U.S. | 812 | — | 812 | 677 | — | 677 | 19.9 | 19.9 | 19.9 | ||||
Intl | 1,155 | (8) | 1,147 | 1,217 | (52) | 1,165 | (5.1) | (1.5) | 4.8 | ||||
Pediatric Nutrition | 924 | (8) | 916 | 847 | (52) | 795 | 9.2 | 15.4 | 18.4 | ||||
U.S. | 459 | — | 459 | 338 | — | 338 | 36.1 | 36.1 | 36.1 | ||||
Intl | 465 | (8) | 457 | 509 | (52) | 457 | (8.6) | 0.2 | 5.3 | ||||
(a) | Reflects the impact of exiting the pediatric nutrition business in China. This action was initiated in December 2022. |
Abbott Laboratories and Subsidiaries Details of Specified Items First Quarter Ended March 31, 2023 (in millions, except per share data) (unaudited) | |||||||||
Acquisition or Divestiture- related (a) | Restructuring and Cost Reduction Initiatives (b) | Intangible Amortization | Other (c) | Total Specifieds | |||||
Gross Margin | $ 5 | $ 21 | $ 491 | $ 3 | $ 520 | ||||
R&D | (4) | 1 | — | (23) | (26) | ||||
SG&A | (4) | (4) | — | 6 | (2) | ||||
Other (income) expense, net | (6) | — | — | 6 | — | ||||
Earnings before taxes | $ 19 | $ 24 | $ 491 | $ 14 | 548 | ||||
Taxes on Earnings (d) | 51 | ||||||||
Net Earnings | $ 497 | ||||||||
Diluted Earnings per Share | $ 0.28 | ||||||||
The table above provides additional details regarding the specified items described on tables titled "Non-GAAP Reconciliation of Financial Information." | |
a) | Acquisition-related expenses include legal and other costs related to business acquisitions as well as integration costs, which represent incremental costs directly related to integrating acquired businesses. |
b) | Restructuring and cost reduction initiative expenses include severance, outplacement and other direct costs associated with specific restructuring plans and cost reduction initiatives. |
c) | Other includes incremental costs to comply with the European Union's Medical Device Regulations (MDR) and In Vitro Diagnostics Medical Device Regulations (IVDR) requirements for previously approved products. |
d) | Reflects the net tax benefit associated with the specified items. |
Abbott Laboratories and Subsidiaries Details of Specified Items First Quarter Ended March 31, 2022 (in millions, except per share data) (unaudited) | |||||||||
Acquisition or Divestiture- related (a) | Restructuring and Cost Reduction Initiatives (b) | Intangible Amortization | Other (c) | Total Specifieds | |||||
Gross Margin | $ 21 | $ (6) | $ 512 | $ 109 | $ 636 | ||||
R&D | (2) | (1) | — | (30) | (33) | ||||
SG&A | (11) | — | — | (28) | (39) | ||||
Other (income) expense, net | (7) | — | — | (8) | (15) | ||||
Earnings before taxes | $ 41 | $ (5) | $ 512 | $ 175 | 723 | ||||
Taxes on Earnings (d) | 93 | ||||||||
Net Earnings | $ 630 | ||||||||
Diluted Earnings per Share | $ 0.36 | ||||||||
The table above provides additional details regarding the specified items described on tables titled "Non-GAAP Reconciliation of Financial Information." | |
a) | Acquisition-related expenses include integration costs, which represent incremental costs directly related to integrating the acquired businesses and include expenditures for the integration of systems, processes and business activities. |
b) | Restructuring and cost reduction initiative expenses include severance, outplacement and other direct costs associated with specific restructuring plans and cost reduction initiatives. The Gross Margin amount includes a credit associated with the charges taken in the second quarter of 2021 for a restructuring plan related to Abbott's manufacturing network for COVID-19 diagnostic tests. |
c) | Other includes charges related to a voluntary recall within the Nutrition segment and incremental costs to comply with the European Union's Medical Device (MDR) and In Vitro Diagnostics Medical Device (IVDR) Regulations for previously approved products. |
d) | Reflects the net tax benefit associated with the specified items, excess tax benefits associated with share-based compensation and net tax expense as a result of the resolution of various tax positions related to prior years. |
SOURCE Abbott
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