Abbott Reports Second-Quarter 2024 Results and Raises Full-Year Guidance
-- Sales of $10.4 billion driven by strong underlying base business
performance
-- Reported sales growth of 4.0 percent; organic sales growth for
underlying base business of 9.3 percent(1), led by double-digit growth
in Medical Devices
-- Continues to strengthen portfolio with new product approvals
ABBOTT PARK, Ill., July 18, 2024 /PRNewswire/ -- Abbott (NYSE: ABT) today announced financial results for the second quarter ended June 30, 2024.
-- Second-quarter GAAP diluted EPS of $0.74 and adjusted diluted EPS of
$1.14, which excludes specified items.
-- Abbott raised its full-year 2024 EPS guidance range. Abbott projects
full-year diluted EPS on a GAAP basis of $3.30 to $3.40 and projects
adjusted diluted EPS of $4.61 to $4.71.
-- Abbott narrowed its full-year 2024 organic sales growth guidance range,
excluding COVID-19 testing-related sales, to 9.5% to 10.0%, which
represents an increase at the midpoint of the range(2).
-- In April, Abbott announced U.S. Food and Drug Administration (FDA)
approval of the Esprit((TM)) below-the-knee (BTK) system, a breakthrough
innovation for people living with peripheral artery disease. This system
is designed to keep arteries open and deliver a drug to support vessel
healing prior to completely dissolving.
-- In June, Abbott announced U.S. FDA clearance for two new
over-the-counter continuous glucose monitoring systems -- Lingo((TM)
)and Libre Rio((TM)), which are based on Abbott's world-leading
FreeStyle Libre(®) continuous glucose monitoring technology(3).
-- In June, Abbott obtained CE Mark for its AVEIR(® )dual chamber (DR)
leadless pacemaker system, the world's first dual chamber leadless
pacemaker system that treats people with abnormal or slow heart rhythms.
-- During the first half of 2024, Abbott announced 10 new growth
opportunities coming from the company's highly productive R&D pipeline.
These include a combination of new product approvals and new treatment
indications.
"We achieved another quarter of strong growth in our underlying base business," said Robert B. Ford, chairman and chief executive officer, Abbott. "We have a lot of positive momentum heading into the second half of the year and are raising our full-year guidance."
SECOND-QUARTER BUSINESS OVERVIEW
Management believes that measuring sales growth rates on an organic basis, which excludes the impact of foreign exchange, the impact of discontinuing the ZonePerfect(®) product line in the Nutrition business, and the impact of the acquisition of Cardiovascular Systems, Inc. (CSI) during the first year post-acquisition, 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 has shifted to an endemic state, resulting in significantly lower 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.
Second Quarter 2024 Results (2Q24)
---
Sales 2Q24 ($ in millions) Total Company Nutrition Diagnostics Established Medical Devices
Pharmaceuticals
U.S. 3,934 933 812 2,185
International 6,443 1,217 1,383 1,294 2,549
Total reported 10,377 2,150 2,195 1,294 4,734
% Change vs. 2Q23
U.S. 4.7 6.0 (15.5)
n/a 14.2
International 3.6 1.7 1.9 0.6 7.0
Total reported 4.0 3.5 (5.3) 0.6 10.2
Impact of foreign exchange (3.5) (3.6) (3.8) (7.5) (2.2)
Impact of business exit and acquisition* 0.1 (0.4) 0.3
Organic 7.4 7.5 (1.5) 8.1 12.1
Impact of COVID-19 testing sales (4) (1.9) (7.4)
Organic (excluding COVID-19 tests) 9.3 7.5 5.9 8.1 12.1
U.S. 9.0 6.9 (0.3)
n/a 13.5
International 9.4 7.9 9.5 8.1 10.9
First Half 2024 Results (1H24)
---
Sales 1H24 ($ in millions) Total Company Nutrition Diagnostics Established Medical Devices
Pharmaceuticals
U.S. 7,780 1,811 1,743 4,219
International 12,561 2,407 2,666 2,520 4,968
Total reported 20,341 4,218 4,409 2,520 9,187
% Change vs. 1H23
U.S. 1.2 7.0 (24.1)
n/a 14.3
International 4.3 2.4 (1.6) 1.8 10.3
Total reported 3.1 4.3 (11.9) 1.8 12.1
Impact of foreign exchange (3.2) (3.1) (2.9) (9.0) (1.7)
Impact of business exit and acquisition* 0.2 (0.2) 0.7
Organic 6.1 7.6 (9.0) 10.8 13.1
Impact of COVID-19 testing sales (4) (3.9) (14.7)
Organic (excluding COVID-19 tests) 10.0 7.6 5.7 10.8 13.1
U.S. 9.5 7.5 3.3
n/a 12.8
International 10.3 7.7 7.1 10.8 13.4
Refer to table titled "Non-GAAP Revenue Reconciliation" for a reconciliation of adjusted historical revenue to reported revenue.
*Reflects the impact of discontinuing the ZonePerfect(®) product line in the Nutrition business in March 2024 and the acquisition of CSI on April 27, 2023. Organic sales growth excludes the impact of the acquired business from January through April 2024.
Nutrition
---
Second Quarter 2024 Results (2Q24)
---
Sales 2Q24 ($ in millions) Total Pediatric Adult
U.S. 933 564 369
International 1,217 495 722
Total reported 2,150 1,059 1,091
% Change vs. 2Q23
U.S. 6.0 11.3 (1.2)
International 1.7 (4.4) 6.4
Total reported 3.5 3.4 3.7
Impact of foreign exchange (3.6) (1.6) (5.4)
Impact of business exit* (0.4) (0.8)
Organic 7.5 5.0 9.9
U.S. 6.9 11.3 0.8
International 7.9 (1.0) 14.7
Worldwide Nutrition sales increased 3.5 percent on a reported basis and 7.5 percent on an organic basis in the second quarter.
In Pediatric Nutrition, global sales increased 3.4 percent on a reported basis and 5.0 percent on an organic basis. Sales in the U.S. reflect continued market share gains in the infant formula business.
In Adult Nutrition, global sales increased 3.7 percent on a reported basis and 9.9 percent on an organic basis, which was led by strong growth of Ensure(®), Abbott's market-leading complete and balanced nutrition brand.
First Half 2024 Results (1H24)
---
Sales 1H24 ($ in millions) Total Pediatric Adult
U.S. 1,811 1,078 733
International 2,407 990 1,417
Total reported 4,218 2,068 2,150
% Change vs. 1H23
U.S. 7.0 11.6 0.8
International 2.4 0.7 3.6
Total reported 4.3 6.1 2.6
Impact of foreign exchange (3.1) (1.5) (4.6)
Impact of business exit* (0.2) (0.4)
Organic 7.6 7.6 7.6
U.S. 7.5 11.6 1.9
International 7.7 3.7 10.5
*Reflects the impact of discontinuing the ZonePerfect(R) product line. This action was initiated in March 2024.
Diagnostics
---
Second Quarter 2024 Results (2Q24)
---
Sales 2Q24 ($ in millions) Total Core Laboratory Molecular Point of
Care Rapid
Diagnostics
U.S. 812 327 33 107 345
International 1,383 1,002 94 49 238
Total reported 2,195 1,329 127 156 583
% Change vs. 2Q23
U.S. (15.5) 5.1 (22.5) 8.1 (32.1)
International 1.9 2.1 (4.9) 14.1 2.1
Total reported (5.3) 2.8 (10.3) 9.9 (21.3)
Impact of foreign exchange (3.8) (5.8) (0.9) (0.1) (1.5)
Organic (1.5) 8.6 (9.4) 10.0 (19.8)
Impact of COVID-19 testing sales (4) (7.4) (0.2) (3.8) (20.2)
Organic (excluding COVID-19 tests) 5.9 8.8 (5.6) 10.0 0.4
U.S. (0.3) 5.3 (19.0) 8.1 (6.6)
International 9.5 9.9 14.5 11.0
As expected, Diagnostics sales growth in the second quarter was negatively impacted by year-over-year declines in COVID-19 testing-related sales(4). Worldwide COVID-19 testing sales were $102 million in the second quarter of 2024 compared to $263 million in the second quarter of the prior year.
Excluding COVID-19 testing-related sales, global Diagnostics sales increased 1.8 percent on a reported basis and 5.9 percent on an organic basis.
Excluding COVID-19 testing-related sales, global Core Laboratory Diagnostics sales increased 3.0 percent on a reported basis and 8.8 percent on an organic basis, led by continued strong adoption of Abbott's Alinity(®) family of diagnostics systems and testing portfolios.
First Half 2024 Results (1H24)
---
Sales 1H24 ($ in millions) Total Core Laboratory Molecular Point of
Care Rapid
Diagnostics
U.S. 1,743 637 75 205 826
International 2,666 1,897 181 90 498
Total reported 4,409 2,534 256 295 1,324
% Change vs. 1H23
U.S. (24.1) 6.2 (16.3) 6.9 (41.6)
International (1.6) 1.2 (8.8) 6.9 (9.7)
Total reported (11.9) 2.4 (11.1) 6.9 (32.7)
Impact of foreign exchange (2.9) (4.9) (0.6) (1.1)
Organic (9.0) 7.3 (10.5) 6.9 (31.6)
Impact of COVID-19 testing sales (4) (14.7) (0.3) (7.3) (34.6)
Organic (excluding COVID-19 tests) 5.7 7.6 (3.2) 6.9 3.0
U.S. 3.3 6.5 (6.7) 6.9 0.3
International 7.1 7.9 (1.8) 7.1 7.1
Established Pharmaceuticals
---
Second Quarter 2024 Results (2Q24)
---
Sales 2Q24 ($ in millions) Total Key Emerging Other
Markets
U.S. -
International 1,294 988 306
Total reported 1,294 988 306
% Change vs. 2Q23
U.S. n/a n/a n/a
International 0.6 (0.2) 3.1
Total reported 0.6 (0.2) 3.1
Impact of foreign exchange (7.5) (9.0) (2.6)
Organic 8.1 8.8 5.7
U.S. n/a n/a n/a
International 8.1 8.8 5.7
Established Pharmaceuticals sales increased 0.6 percent on a reported basis and 8.1 percent on an organic basis in the second 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 decreased 0.2 percent on a reported basis and increased 8.8 percent on an organic basis, led by growth in several geographies and therapeutic areas, including cardiometabolic, gastroenterology, and central nervous system/pain management.
First Half 2024 Results (1H24)
---
Sales 1H24 ($ in millions) Total Key Emerging Other
Markets
U.S. -
International 2,520 1,916 604
Total reported 2,520 1,916 604
% Change vs. 1H23
U.S. n/a n/a n/a
International 1.8 0.7 5.3
Total reported 1.8 0.7 5.3
Impact of foreign exchange (9.0) (11.3) (1.6)
Organic 10.8 12.0 6.9
U.S. n/a n/a n/a
International 10.8 12.0 6.9
Medical Devices
---
Second Quarter 2024 Results (2Q24)
---
Sales 2Q24 ($ in millions) Total Rhythm Electro- Heart Vascular Structural Neuro- Diabetes
Management Failure Heart modulation Care
physiology
U.S. 2,185 292 287 244 275 258 192 637
International 2,549 315 340 77 449 306 51 1,011
Total reported 4,734 607 627 321 724 564 243 1,648
% Change vs. 2Q23
U.S. 14.2 8.5 16.8 7.7 4.3 17.9 3.7 26.3
International 7.0 0.4 10.5 11.4 (0.4) 9.4 21.7 10.0
Total reported 10.2 4.2 13.3 8.6 1.3 13.2 7.0 15.8
Impact of foreign exchange (2.2) (1.7) (3.4) (0.3) (2.0) (2.4) (1.2) (2.4)
Impact of acquisition* 0.3 2.1
Organic 12.1 5.9 16.7 8.9 1.2 15.6 8.2 18.2
U.S. 13.5 8.5 16.8 7.7 (0.8) 17.9 3.7 26.3
International 10.9 3.7 16.7 12.8 2.5 13.8 28.4 13.7
Worldwide Medical Devices sales increased 10.2 percent on a reported basis and 12.1 percent on an organic basis in the second quarter, including double-digit organic growth in both the U.S. and internationally.
Sales growth was led by double-digit growth in Diabetes Care, Electrophysiology, and Structural Heart. Several recently launched products and new indications contributed to the strong performance, including Amplatzer(®) Amulet(®), Navitor(®), TriClip(®), and AVEIR(®).
In Electrophysiology, sales grew 13.3 percent on a reported basis and 16.7 percent on an organic basis, which included double-digit growth in catheters and cardiac mapping-related products, and double-digit growth in all major geographic regions.
In Diabetes Care, FreeStyle Libre sales were $1.6 billion, which represents sales growth of 18.4 percent on a reported basis and 20.4 percent on an organic basis.
First Half 2024 Results (1H24)
---
Sales 1H24 ($ in millions) Total Rhythm Electro- Heart Vascular Structural Neuro- Diabetes
Management Failure Heart modulation Care
physiology
U.S. 4,219 563 556 481 529 491 373 1,226
International 4,968 606 658 145 884 588 96 1,991
Total reported 9,187 1,169 1,214 626 1,413 1,079 469 3,217
% Change vs. 1H23
U.S. 14.3 6.6 15.0 8.2 9.8 14.4 9.6 24.6
International 10.3 4.4 14.4 9.7 4.1 10.9 15.9 13.6
Total reported 12.1 5.4 14.7 8.6 6.1 12.5 10.9 17.6
Impact of foreign exchange (1.7) (1.3) (2.8) (0.1) (1.5) (1.8) (1.6) (1.8)
Impact of acquisition* 0.7 4.3
Organic 13.1 6.7 17.5 8.7 3.3 14.3 12.5 19.4
U.S. 12.8 6.6 15.0 8.2 (1.3) 14.4 9.6 24.6
International 13.4 6.8 19.6 10.1 6.0 14.3 24.1 16.5
*Abbott completed the acquisition of CSI on April 27, 2023. For purposes of calculating organic sales growth, the impact from this acquired business has been excluded from January through April 2024.
ABBOTT'S EARNINGS-PER-SHARE GUIDANCE
Abbott projects full-year 2024 diluted earnings per share under GAAP of $3.30 to $3.40. Abbott forecasts specified items for the full-year 2024 of $1.31 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 would be $4.61 to $4.71 for the full-year 2024.
Abbott projects third-quarter 2024 diluted earnings per share under GAAP of $0.85 to $0.89. Abbott forecasts specified items for the third-quarter 2024 of $0.33 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 would be $1.18 to $1.22 for the third quarter 2024.
ABBOTT DECLARES 402(ND )CONSECUTIVE QUARTERLY DIVIDEND
On June 14, 2024, the board of directors of Abbott declared the company's quarterly dividend of $0.55 per share. Abbott's cash dividend is payable Aug. 15, 2024, to shareholders of record at the close of business on July 15, 2024.
Abbott has increased its dividend payout for 52 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 114,000 colleagues serve people in more than 160 countries.
Connect with us at www.abbott.com and on LinkedIn, Facebook, Instagram, X and YouTube.
Abbott will live-webcast its second-quarter earnings conference call through its Investor Relations website at www.abbottinvestor.com at 8 a.m. Central time today. An archived edition of the 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, 2023, 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 In the second quarter of 2024, total worldwide sales were $10.377 billion and COVID-19 testing-related sales were $102 million. In the second
quarter of 2023, total worldwide sales were $9.978 billion and COVID-19 testing-related sales were $263 million.
2 Abbott has not provided the related GAAP financial measure for organic sales growth, excluding COVID-19 testing-related sales, on a forward-
looking basis because the company is unable to predict with reasonable certainty the impact of foreign exchange due to the unpredictability of
future changes in foreign exchange rates, which could significantly impact reported sales growth. In addition, as the COVID-19 pandemic has shifted
to an endemic state, the company has determined that it is unable to predict with reasonable certainty future COVID-19 test sales due to the
unpredictability of demand for COVID-19 tests.
3
Data on file. Abbott Diabetes Care.
4
Diagnostic sales and COVID-19 testing-related sales in 2024 and 2023 are summarized below:
Sales 2Q24 COVID Tests Sales
2Q24
($ in millions) U.S. Int'l Total U.S. Int'l Total
Total Diagnostics 812 1,383 2,195 69 33 102
Core Laboratory 327 1,002 1,329 1 1 2
Molecular 33 94 127 2 1 3
Rapid Diagnostics 345 238 583 66 31 97
Sales 2Q23 COVID Tests Sales
2Q23
($ in millions) U.S. Int'l Total U.S. Int'l Total
Total Diagnostics 961 1,356 2,317 216 47 263
Core Laboratory 311 982 1,293 2 3 5
Molecular 43 98 141 4 4 8
Rapid Diagnostics 508 233 741 210 40 250
Sales 1H24 COVID Tests Sales
1H24
($ in millions) U.S. Int'l Total U.S. Int'l Total
Total Diagnostics 1,743 2,666 4,409 222 84 306
Core Laboratory 637 1,897 2,534 2 3 5
Molecular 75 181 256 5 2 7
Rapid Diagnostics 826 498 1,324 215 79 294
Sales 1H23 COVID Tests Sales
1H23
($ in millions) U.S. Int'l Total U.S. Int'l Total
Total Diagnostics 2,296 2,709 5,005 824 169 993
Core Laboratory 600 1,875 2,475 4 7 11
Molecular 90 198 288 14 14 28
Rapid Diagnostics 1,414 552 1,966 806 148 954
Abbott Laboratories and Subsidiaries
Condensed Consolidated Statement of Earnings
Second Quarter Ended June 30, 2024 and 2023
(in millions, except per share data)
(unaudited)
2Q24 2Q23 % Change
Net Sales $10,377 $9,978 4.0
Cost of products sold, excluding amortization expense 4,603 4,483 2.7
Amortization of intangible assets 471 498 (5.6)
Research and development 698 715 (2.3)
Selling, general, and administrative 2,936 2,740 7.1
Total Operating Cost and Expenses 8,708 8,436 3.2
Operating Earnings 1,669 1,542 8.2
Interest expense, net 58 61 (5.1)
Net foreign exchange (gain) loss (6) 21 n/m
Other (income) expense, net 10 (176) n/m
Earnings before taxes 1,607 1,636 (1.8)
Taxes on earnings 305 261 17.1 1)
Net Earnings $1,302 $1,375 (5.3)
Net Earnings excluding Specified Items, as described below $2,003 $1,893 5.8 2)
Diluted Earnings per Common Share $0.74 $0.78 (5.1)
Diluted Earnings per Common Share, $1.14 $1.08 5.6 2)
excluding Specified Items, as described below
Average Number of Common Shares Outstanding 1,751 1,750
Plus Dilutive Common Stock Options
NOTES:
See table tilted "Non-GAAP Reconciliation of Financial Information" for an explanation of certain non-GAAP financial information.
n/m = Percent change is not meaningful.
See footnotes on the following section.
1) 2024 Taxes on Earnings includes the recognition of approximately $25 million of net tax expense as a result of the resolution of various tax
positions related to prior years.
2023 Taxes on Earnings includes the recognition of approximately $40 million of net tax expense as a result of the resolution of various tax
positions related to prior years.
2) 2024 Net Earnings and Diluted Earnings per Common Share, excluding Specified Items, excludes net after-tax charges of $701 million, or $0.40 per
share, for intangible amortization, charges related to restructuring and cost reduction initiatives, expenses associated with acquisitions and a
divestiture, and other net expenses.
2023 Net Earnings and Diluted Earnings per Common Share, excluding Specified Items, excludes net after-tax charges of $518 million, or $0.30 per
share, for intangible amortization, charges related to restructuring and cost reduction initiatives, expenses associated with acquisitions and
other net expenses.
Abbott Laboratories and Subsidiaries
Condensed Consolidated Statement of Earnings
First Half Ended June 30, 2024 and 2023
(in millions, except per share data)
(unaudited)
1H24 1H23 % Change
Net Sales $20,341 $19,725 3.1
Cost of products sold, excluding amortization expense 9,066 8,814 2.9
Amortization of intangible assets 943 989 (4.7)
Research and development 1,382 1,369 0.9
Selling, general, and administrative 5,895 5,502 7.1
Total Operating Cost and Expenses 17,286 16,674 3.7
Operating Earnings 3,055 3,051 0.2
Interest expense, net 119 113 5.6
Net foreign exchange (gain) loss (6) 27 n/m
Other (income) expense, net (101) (287) n/m
Earnings before taxes 3,043 3,198 (4.8)
Taxes on earnings 516 505 2.2 1)
Net Earnings $2,527 $2,693 (6.2)
Net Earnings excluding Specified Items, as described below $3,732 $3,708 0.7 2)
Diluted Earnings per Common Share $1.44 $1.53 (5.9)
Diluted Earnings per Common Share, $2.12 $2.11 0.5 2)
excluding Specified Items, as described below
Average Number of Common Shares Outstanding 1,750 1,751
Plus Dilutive Common Stock Options
NOTES:
See table tilted "Non-GAAP Reconciliation of Financial Information" for an explanation of certain non-GAAP financial information.
n/m = Percent change is not meaningful.
See footnotes on the following section.
1) 2024 Taxes on Earnings includes the recognition of approximately $35 million of net tax expense as a result of the resolution of various tax
positions related to prior years.
2023 Taxes on Earnings includes the recognition of approximately $62 million of net tax expense as a result of the resolution of various tax
positions related to prior years.
2) 2024 Net Earnings and Diluted Earnings per Common Share, excluding Specified Items, excludes net after-tax charges of $1.205 billion, or $0.68 per
share, for intangible amortization, charges related to restructuring and cost reduction initiatives, expenses associated with acquisitions and a
divestiture, and other net expenses.
2023 Net Earnings and Diluted Earnings per Common Share, excluding Specified Items, excludes net after-tax charges of $1.015 billion, or $0.58 per
share, for intangible amortization, charges related to restructuring and cost reduction initiatives, expenses associated with acquisitions and
other net expenses.
Abbott Laboratories and Subsidiaries
Non-GAAP Reconciliation of Financial Information
Second Quarter Ended June 30, 2024 and 2023
(in millions, except per share data)
(unaudited)
2Q24
As Specified As
Items
Reported Adjusted
(GAAP)
Intangible Amortization $471 $(471)
$ -
Gross Margin 5,303 506 5,809
R&D 698 (41) 657
SG&A 2,936 (57) 2,879
Other (income) expense, net 10 (145) (135)
Earnings before taxes 1,607 749 2,356
Taxes on Earnings 305 48 353
Net Earnings 1,302 701 2,003
Diluted Earnings per Share $0.74 $0.40 $1.14
Specified items reflect intangible amortization expense of $471 million and other net expenses of $278 million associated with restructuring actions, acquisitions, a divestiture and other net expenses. See table titled "Details of Specified Items" for additional details regarding specified items.
2Q23
As Specified As
Items
Reported Adjusted
(GAAP)
Intangible Amortization $498 $(498)
$ -
Gross Margin 4,997 529 5,526
R&D 715 (72) 643
SG&A 2,740 (22) 2,718
Other (income) expense, net (176) 57 (119)
Earnings before taxes 1,636 566 2,202
Taxes on Earnings 261 48 309
Net Earnings 1,375 518 1,893
Diluted Earnings per Share $0.78 $0.30 $1.08
Specified items reflect intangible amortization expense of $498 million and other net expenses of $68 million associated with restructuring actions, costs associated with acquisitions and other net expenses. See table titled "Details of Specified Items" for additional details regarding specified items.
Abbott Laboratories and Subsidiaries
Non-GAAP Reconciliation of Financial Information
First Half Ended June 30, 2024 and 2023
(in millions, except per share data)
(unaudited)
1H24
As Specified As
Items
Reported Adjusted
(GAAP)
Intangible Amortization $943 $(943)
$ -
Gross Margin 10,332 1,024 11,356
R&D 1,382 (62) 1,320
SG&A 5,895 (91) 5,804
Other (income) expense, net (101) (171) (272)
Earnings before taxes 3,043 1,348 4,391
Taxes on Earnings 516 143 659
Net Earnings 2,527 1,205 3,732
Diluted Earnings per Share $1.44 $0.68 $2.12
Specified items reflect intangible amortization expense of $943 million and other net expenses of $405 million associated with restructuring actions, acquisitions, a divestiture and other net expenses. See table titled "Details of Specified Items" for additional details regarding specified items.
1H23
As Specified As
Items
Reported Adjusted
(GAAP)
Intangible Amortization $989 $(989)
$ -
Gross Margin 9,922 1,049 10,971
R&D 1,369 (98) 1,271
SG&A 5,502 (24) 5,478
Other (income) expense, net (287) 57 (230)
Earnings before taxes 3,198 1,114 4,312
Taxes on Earnings 505 99 604
Net Earnings 2,693 1,015 3,708
Diluted Earnings per Share $1.53 $0.58 $2.11
Specified items reflect intangible amortization expense of $989 million and other net expenses of $125 million associated with restructuring actions, costs associated with acquisitions and other expenses. See table titled "Details of Specified Items" for additional details regarding specified items.
A reconciliation of the second-quarter tax rates for 2024 and 2023 is shown below:
2Q24
($ in millions) Pre-Tax Taxes on Tax
Income Earnings Rate
As reported (GAAP) $1,607 $305 19.0 % 1)
Specified items 749 48
Excluding specified items $2,356 $353 15.0 %
2Q23
($ in millions) Pre-Tax Taxes on Tax
Income Earnings Rate
As reported (GAAP) $1,636 $261 15.9 % 2)
Specified items 566 48
Excluding specified items $2,202 $309 14.0 %
1) 2024 Taxes on Earnings includes the recognition of approximately $25 million of net tax expense as a result of the resolution of
various tax positions related to prior years.
2) 2023 Taxes on Earnings includes the recognition of approximately $40 million of net tax expense as a result of the resolution of
various tax positions related to prior years.
A reconciliation of the year-to-date tax rates for 2024 and 2023 is shown below:
1H24
($ in millions) Pre-Tax Taxes on Tax
Income Earnings Rate
As reported (GAAP) $3,043 $516 17.0 % 3)
Specified items 1,348 143
Excluding specified items $4,391 $659 15.0 %
1H23
($ in millions) Pre-Tax Taxes on Tax
Income Earnings Rate
As reported (GAAP) $3,198 $505 15.8 % 4)
Specified items 1,114 99
Excluding specified items $4,312 $604 14.0 %
3) 2024 Taxes on Earnings includes the recognition of approximately $35 million of net tax expense as a result of the resolution of
various tax positions related to prior years.
4) 2023 Taxes on Earnings includes the recognition of approximately $62 million of net tax expense as a result of the resolution of
various tax positions related to prior years.
Abbott Laboratories and Subsidiaries
Non-GAAP Revenue Reconciliation
Second Quarter and First Half Ended June 30, 2024 and 2023
($ in millions)
(unaudited)
2Q24
2Q23 % Change vs. 2Q23
Non-GAAP
Abbott Impact of Impact Adjusted Abbott Impact Adjusted Reported Adjusted Organic
Reported acquisition from Revenue Reported from Revenue
(a) business business
exit (b) exit (b)
Total Company 10,377 (15) (8) 10,354 9,978 (15) 9,963 4.0 3.9 7.4
U.S. 3,934 (13) (8) 3,913 3,758 (15) 3,743 4.7 4.6 4.6
Intl 6,443 (2) 6,441 6,220 6,220 3.6 3.5 9.2
Total Nutrition 2,150 (8) 2,142 2,076 (15) 2,061 3.5 3.9 7.5
U.S. 933 (8) 925 881 (15) 866 6.0 6.9 6.9
Intl 1,217 1,217 1,195 1,195 1.7 1.7 7.9
Adult Nutrition 1,091 (8) 1,083 1,052 (15) 1,037 3.7 4.5 9.9
U.S. 369 (8) 361 374 (15) 359 (1.2) 0.8 0.8
Intl 722 722 678 678 6.4 6.4 14.7
Total Medical Devices 4,734 (15) 4,719 4,295 4,295 10.2 9.9 12.1
U.S. 2,185 (13) 2,172 1,913 1,913 14.2 13.5 13.5
Intl 2,549 (2) 2,547 2,382 2,382 7.0 7.0 10.9
Vascular 724 (15) 709 715 715 1.3 (0.8) 1.2
U.S. 275 (13) 262 264 264 4.3 (0.8) (0.8)
Intl 449 (2) 447 451 451 (0.4) (0.6) 2.5
1H24
1H23 % Change vs. 1H23
Non-GAAP
Abbott Impact of Impact Adjusted Abbott Impact Adjusted Reported Adjusted Organic
Reported acquisition
(a) from Revenue Reported from Revenue
business business
exit (b) exit (b)
Total Company 20,341 (57) (8) 20,276 19,725 (15) 19,710 3.1 2.9 6.1
U.S. 7,780 (53) (8) 7,719 7,686 (15) 7,671 1.2 0.6 0.6
Intl 12,561 (4) 12,557 12,039 12,039 4.3 4.3 9.6
Total Nutrition 4,218 (8) 4,210 4,043 (15) 4,028 4.3 4.5 7.6
U.S. 1,811 (8) 1,803 1,693 (15) 1,678 7.0 7.5 7.5
Intl 2,407 2,407 2,350 2,350 2.4 2.4 7.7
Adult Nutrition 2,150 (8) 2,142 2,095 (15) 2,080 2.6 3.0 7.6
U.S. 733 (8) 725 727 (15) 712 0.8 1.9 1.9
Intl 1,417 1,417 1,368 1,368 3.6 3.6 10.5
Total Medical Devices 9,187 (57) 9,130 8,195 8,195 12.1 11.4 13.1
U.S. 4,219 (53) 4,166 3,691 3,691 14.3 12.8 12.8
Intl 4,968 (4) 4,964 4,504 4,504 10.3 10.2 13.4
Vascular 1,413 (57) 1,356 1,332 1,332 6.1 1.8 3.3
U.S. 529 (53) 476 482 482 9.8 (1.3) (1.3)
Intl 884 (4) 880 850 850 4.1 3.6 6.0
(a) Abbott completed the acquisition of CSI on April 27, 2023. For purposes of calculating organic sales growth, the impact from this acquired business has been excluded from January through April 2024.
(b) Reflects the impact of discontinuing the ZonePerfect(R) product line in the Nutrition business. This action was initiated in March 2024.
Abbott Laboratories and Subsidiaries
Details of Specified Items
Second Quarter Ended June 30, 2024
(in millions, except per share data)
(unaudited)
Acquisition
or Restructuring Intangible Other (c) Total
Divestiture- and Cost Amortization Specifieds
related (a) Reduction
Initiatives
(b)
Gross Margin $1 $32 $471 $2 $506
R&D (1) 1 (41) (41)
SG&A (11) (10) (36) (57)
Other (income) expense, net (147) 2 (145)
Earnings before taxes $160 $41 $471 $77 749
Taxes on Earnings (d) 48
Net Earnings $701
Diluted Earnings per Share $0.40
The table above provides additional details regarding the specified items described on tables titled "Non-GAAP Reconciliation of Financial Information."
a) Includes the loss on the sale of a non-core business. Acquisition-related expenses include 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 and an intangible asset impairment charge.
d) Reflects the net tax benefit associated with the specified items and tax expense as a result of the resolution of various tax positions related to
prior years.
Abbott Laboratories and Subsidiaries
Details of Specified Items
Second Quarter Ended June 30, 2023
(in millions, except per share data)
(unaudited)
Acquisition
or Restructuring Intangible Other (c) Total
Divestiture- and Cost Amortization Specifieds
related (a) Reduction
Initiatives
(b)
Gross Margin $7 $11 $498 $13 $529
R&D (8) 7 (71) (72)
SG&A (17) (2) (3) (22)
Other (income) expense, net 47 10 57
Earnings before taxes $(15) $6 $498 $77 566
Taxes on Earnings (d) 48
Net Earnings $518
Diluted Earnings per Share $0.30
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. These costs were more than offset by fair value adjustments to contingent
consideration related to business acquisitions.
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 and charges for intangible asset impairments.
d) Reflects the net tax benefit associated with the specified items and tax expense as a result of the resolution of various tax positions related to
prior years.
Abbott Laboratories and Subsidiaries
Details of Specified Items
First Half Ended June 30, 2024
(in millions, except per share data)
(unaudited)
Acquisition
or Restructuring Intangible Other (c) Total
Divestiture- and Cost Amortization Specifieds
related (a) Reduction
Initiatives
(b)
Gross Margin $2 $74 $943 $5 $1,024
R&D (4) (1) (57) (62)
SG&A (25) (19) (47) (91)
Other (income) expense, net (135) (36) (171)
Earnings before taxes $166 $94 $943 $145 1,348
Taxes on Earnings (d) 143
Net Earnings $1,205
Diluted Earnings per Share $0.68
The table above provides additional details regarding the specified items described on tables titled "Non-GAAP Reconciliation of Financial Information."
a) Includes the loss on the sale of a non-core business. Acquisition-related expenses include integration costs, which represent incremental costs
directly related to integrating acquired businesses, as well as other costs related to business acquisitions.
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 MDR and IVDR regulations for previously approved products and charges for investment and
intangible asset impairments.
d) Reflects the net tax benefit associated with the specified items and tax expense as a result of the resolution of various tax positions related to
prior years.
Abbott Laboratories and Subsidiaries
Details of Specified Items
First Half Ended June 30, 2023
(in millions, except per share data)
(unaudited)
Acquisition
or Restructuring Intangible Other (c) Total
Divestiture- and Cost Amortization Specifieds
related (a) Reduction
Initiatives
(b)
Gross Margin $12 $32 $989 $16 $1,049
R&D (12) 8 (94) (98)
SG&A (21) (6) 3 (24)
Other (income) expense, net 41 16 57
Earnings before taxes $4 $30 $989 $91 1,114
Taxes on Earnings (d) 99
Net Earnings $1,015
Diluted Earnings per Share $0.58
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. These costs were partially offset by fair value adjustments to contingent
consideration related to business acquisitions.
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 MDR and IVDR regulations for previously approved products and charges for intangible asset
impairments.
d) Reflects the net tax benefit associated with the specified items and tax expense as a result of the resolution of various tax positions related to
prior years.
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SOURCE Abbott
