Abbott Reports 2018 Results and Issues Strong Forecast for 2019
ABBOTT PARK, Ill., Jan. 23, 2019 /PRNewswire/ -- Abbott today announced financial results for the fourth quarter and full year ended Dec. 31, 2018, and issued financial outlook for 2019.
- Full-year 2018 worldwide sales of $30.6 billion increased 11.6 percent on a reported basis and 7.3 percent on an organic* basis.
- Reported diluted EPS from continuing operations under GAAP was $1.31 in the full year 2018 and adjusted diluted EPS from continuing operations, which excludes specified items, was $2.88, reflecting 15.2 percent growth1.
- Fourth-quarter worldwide sales of $7.8 billion increased 2.3 percent on a reported basis and 6.4 percent on an organic basis.
- Reported diluted EPS from continuing operations under GAAP was $0.37 in the fourth quarter and adjusted diluted EPS from continuing operations, which excludes specified items, was $0.81.
- Abbott issues full-year 2019 guidance for organic sales growth of 6.5 to 7.5 percent2, which excludes the impact of foreign exchange, and diluted EPS from continuing operations on a GAAP basis of $1.80 to $1.90. Projected full-year adjusted diluted EPS from continuing operations is $3.15 to $3.25, reflecting double-digit growth at the mid-point.
- In 2018, Abbott generated strong operating cash flow and paid down more than $8 billion of debt.
- During 2018, Abbott returned $2 billion to shareholders in the form of dividends and, in December, announced a 14.3 percent increase in its quarterly common dividend.
- In October, Abbott received U.S. FDA approval of its HeartMate 3™ left ventricular assist device as a destination (long-term use) therapy. In January 2019, Abbott announced U.S. FDA approval of its TactiCath™ Contact Force Ablation Catheter, Sensor Enabled™, a new catheter designed to help physicians accurately and effectively treat atrial fibrillation, a form of irregular heartbeat.
"2018 was another outstanding year for Abbott," said Miles D. White, chairman and chief executive officer, Abbott. "We exceeded the organic sales growth range we set at the beginning of the year, achieved a number of significant advances in our pipeline, and significantly improved our balance sheet and strategic flexibility. We're very well-positioned heading into 2019."
* See note on organic growth below. |
FOURTH-QUARTER AND FULL-YEAR 2018 BUSINESS OVERVIEW
Note: Management believes that measuring sales growth rates on an organic basis is an appropriate way for investors to best understand the underlying performance of the business.
For 2018, Organic sales growth:
- Excludes prior year results for the Abbott Medical Optics (AMO) and St. Jude Medical vascular closure businesses, which were divested during the first quarter 2017;
- Excludes the current and prior year results for Rapid Diagnostics, which reflect results for Alere Inc., which was acquired on Oct. 3, 2017;
- Excludes the prior year fourth quarter results for a non-core business within U.S. Adult Nutrition, which was discontinued during the third quarter 2018; and
- Excludes the impact of foreign exchange.
Following are sales by business segment and commentary for the fourth quarter and full year 2018:
Total Company | |||||||||||||||||
($ in millions) | |||||||||||||||||
% Change vs. 4Q17 | |||||||||||||||||
Sales 4Q18 | Reported | Organic | |||||||||||||||
U.S. | Int'l | Total | U.S. | Int'l | Total | U.S. | Int'l | Total | |||||||||
Total * | 2,755 | 5,010 | 7,765 | 3.0 | 2.0 | 2.3 | 4.3 | 7.6 | 6.4 | ||||||||
Nutrition | 762 | 1,015 | 1,777 | (0.9) | (0.1) | (0.4) | 1.5 | 5.1 | 3.6 | ||||||||
Diagnostics | 699 | 1,262 | 1,961 | 1.1 | 3.9 | 2.9 | 2.5 | 9.4 | 7.4 | ||||||||
Established Pharmaceuticals | -- | 1,090 | 1,090 | n/a | (4.8) | (4.8) | n/a | 3.6 | 3.6 | ||||||||
Medical Devices | 1,285 | 1,635 | 2,920 | 6.6 | 6.8 | 6.7 | 6.6 | 10.9 | 9.0 |
* Total Q4 2018 Abbott sales from continuing operations include Other Sales of $17 million. |
% Change vs. 12M17 | |||||||||||||||||
Sales 12M18 | Reported | Organic | |||||||||||||||
U.S. | Int'l | Total | U.S. | Int'l | Total | U.S. | Int'l | Total | |||||||||
Total * | 10,839 | 19,739 | 30,578 | 12.1 | 11.4 | 11.6 | 4.5 | 8.8 | 7.3 | ||||||||
Nutrition | 3,075 | 4,154 | 7,229 | 1.5 | 6.7 | 4.4 | 2.1 | 7.6 | 5.2 | ||||||||
Diagnostics | 2,717 | 4,778 | 7,495 | 49.6 | 25.8 | 33.5 | 3.1 | 8.3 | 6.7 | ||||||||
Established Pharmaceuticals | -- | 4,422 | 4,422 | n/a | 3.2 | 3.2 | n/a | 7.0 | 7.0 | ||||||||
Medical Devices | 5,011 | 6,359 | 11,370 | 6.4 | 13.2 | 10.1 | 6.5 | 11.3 | 9.1 |
* Total YTD 2018 Abbott sales from continuing operations include Other Sales of $62 million. |
n/a = Not Applicable. |
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. |
Fourth-quarter 2018 worldwide sales of $7.8 billion increased 2.3 percent on a reported basis. On an organic basis, worldwide sales increased 6.4 percent. For the full-year 2018, worldwide sales increased 11.6 percent on a reported basis and 7.3 percent on an organic basis. Refer to tables titled "Non-GAAP Reconciliation of Adjusted Historical Revenue" for a reconciliation of adjusted historical revenue.
Nutrition | |||||||||||||||||
($ in millions) | |||||||||||||||||
% Change vs. 4Q17 | |||||||||||||||||
Sales 4Q18 | Reported | Organic | |||||||||||||||
U.S. | Int'l | Total | U.S. | Int'l | Total | U.S. | Int'l | Total | |||||||||
Total | 762 | 1,015 | 1,777 | (0.9) | (0.1) | (0.4) | 1.5 | 5.1 | 3.6 | ||||||||
Pediatric | 467 | 546 | 1,013 | 3.7 | (0.8) | 1.2 | 3.7 | 3.7 | 3.7 | ||||||||
Adult | 295 | 469 | 764 | (7.5) | 0.9 | (2.5) | (1.8) | 6.6 | 3.5 | ||||||||
% Change vs. 12M17 | |||||||||||||||||
Sales 12M18 | Reported | Organic | |||||||||||||||
U.S. | Int'l | Total | U.S. | Int'l | Total | U.S. | Int'l | Total | |||||||||
Total | 3,075 | 4,154 | 7,229 | 1.5 | 6.7 | 4.4 | 2.1 | 7.6 | 5.2 | ||||||||
Pediatric | 1,843 | 2,254 | 4,097 | 3.7 | 6.7 | 5.3 | 3.7 | 7.2 | 5.6 | ||||||||
Adult | 1,232 | 1,900 | 3,132 | (1.7) | 6.6 | 3.2 | (0.3) | 8.0 | 4.6 |
Worldwide Nutrition sales decreased 0.4 percent on a reported basis in the fourth quarter. On an organic basis, sales increased 3.6 percent. For the full-year 2018, worldwide sales increased 4.4 percent on a reported basis and 5.2 percent on an organic basis. Refer to tables titled "Non-GAAP Reconciliation of Adjusted Historical Revenue" for a reconciliation of adjusted historical revenue.
Worldwide Pediatric Nutrition sales increased 1.2 percent on a reported basis in the fourth quarter, including an unfavorable 2.5 percent effect of foreign exchange, and increased 3.7 percent on an organic basis. International pediatric sales decreased 0.8 percent on a reported basis, including an unfavorable 4.5 percent effect of foreign exchange, and increased 3.7 percent on an organic basis. Performance in the quarter was led by above-market growth in the U.S. and strong growth across several markets in Asia and Latin America, including China, Vietnam and Mexico.
Worldwide Adult Nutrition sales decreased 2.5 percent on a reported basis in the fourth quarter, and increased 3.5 percent on an organic basis. International adult sales increased 0.9 percent on a reported basis, including an unfavorable 5.7 percent effect of foreign exchange, and increased 6.6 percent on an organic basis. Worldwide sales performance was led by strong growth of Ensure®, Abbott's market-leading complete and balanced nutrition brand, and Glucerna®, Abbott's market-leading diabetes-specific nutrition brand.
Diagnostics | |||||||||||||||||
($ in millions) | |||||||||||||||||
% Change vs. 4Q17 | |||||||||||||||||
Sales 4Q18 | Reported | Organic | |||||||||||||||
U.S. | Int'l | Total | U.S. | Int'l | Total | U.S. | Int'l | Total | |||||||||
Total * | 699 | 1,262 | 1,961 | 1.1 | 3.9 | 2.9 | 2.5 | 9.4 | 7.4 | ||||||||
Core Laboratory | 260 | 893 | 1,153 | 7.1 | 4.4 | 5.0 | 7.1 | 10.1 | 9.4 | ||||||||
Molecular | 38 | 85 | 123 | 1.8 | 1.2 | 1.4 | 1.8 | 4.7 | 3.8 | ||||||||
Point of Care | 108 | 29 | 137 | (6.7) | (0.6) | (5.5) | (6.7) | 1.1 | (5.1) | ||||||||
Rapid Diagnostics * | 293 | 255 | 548 | (0.9) | 3.9 | 1.3 | n/a | n/a | n/a |
* Rapid Diagnostics reflects sales from Alere Inc., which was acquired on Oct. 3, 2017. Organic growth rates above exclude results from the Rapid Diagnostics business. |
n/a = Percent change is not applicable as organic results exclude Rapid Diagnostics in 2018. |
% Change vs. 12M17 | |||||||||||||||||
Sales 12M18 | Reported | Organic | |||||||||||||||
U.S. | Int'l | Total | U.S. | Int'l | Total | U.S. | Int'l | Total | |||||||||
Total * | 2,717 | 4,778 | 7,495 | 49.6 | 25.8 | 33.5 | 3.1 | 8.3 | 6.7 | ||||||||
Core Laboratory | 985 | 3,401 | 4,386 | 7.0 | 8.3 | 8.0 | 7.0 | 8.3 | 8.0 | ||||||||
Molecular | 152 | 332 | 484 | (4.8) | 9.7 | 4.7 | (4.8) | 9.1 | 4.3 | ||||||||
Point of Care | 432 | 121 | 553 | (2.0) | 10.0 | 0.4 | (2.0) | 9.2 | 0.3 | ||||||||
Rapid Diagnostics * | 1,148 | 924 | 2,072 | n/m | n/m | n/m | n/m | n/m | n/m |
* Rapid Diagnostics reflects sales from Alere Inc., which was acquired on Oct. 3, 2017. Organic growth rates above exclude results from the Rapid Diagnostics business. |
n/m = Percent change is not meaningful. |
Worldwide Diagnostics sales increased 2.9 percent on a reported basis in the fourth quarter. On an organic basis, sales increased 7.4 percent. For the full-year 2018, worldwide sales increased 33.5 percent on a reported basis and 6.7 percent on an organic basis. Refer to tables titled "Non-GAAP Reconciliation of Adjusted Historical Revenue" for a reconciliation of adjusted historical revenue.
Core Laboratory Diagnostics sales increased 5.0 percent on a reported basis in the fourth quarter, including an unfavorable 4.4 percent effect of foreign exchange, and increased 9.4 percent on an organic basis, reflecting above-market growth in the U.S. and internationally, where Abbott is seeing continued strong adoption of Alinity™, Abbott's family of innovative and highly differentiated diagnostic instruments.
Molecular Diagnostics sales increased 1.4 percent on a reported basis in the fourth quarter, including an unfavorable 2.4 percent effect of foreign exchange, and increased 3.8 percent on an organic basis. Worldwide sales were led by growth in infectious disease testing, Abbott's core area of focus in the molecular diagnostics market.
Point of Care Diagnostics sales decreased 5.5 percent on a reported basis in the fourth quarter, including an unfavorable 0.4 percent effect of foreign exchange, and decreased 5.1 percent on an organic basis.
Rapid Diagnostics worldwide sales of $548 million were led by infectious disease and cardiometabolic testing.
Established Pharmaceuticals | |||||||||||||||||
($ in millions) | |||||||||||||||||
% Change vs. 4Q17 | |||||||||||||||||
Sales 4Q18 | Reported | Organic | |||||||||||||||
U.S. | Int'l | Total |
- 23 Jan 2019
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