Abbott Reports Third-Quarter 2024 Results and Raises Midpoint of Full-Year EPS Guidance Range
-- Sales of $10.6 billion driven by strong underlying base business
performance
-- Reported sales growth of 4.9 percent; organic sales growth for
underlying base business of 8.2 percent(1), led by double-digit growth
in Medical Devices
-- Continues to strengthen portfolio with steady cadence of new product
approvals, reimbursement coverage, and clinical data
ABBOTT PARK, Ill., Oct. 16, 2024 /PRNewswire/ -- Abbott (NYSE: ABT) today announced financial results for the third quarter ended Sept. 30, 2024.
-- Third-quarter GAAP diluted EPS of $0.94 and adjusted diluted EPS of
$1.21, which excludes specified items.
-- Abbott maintains its full-year 2024 organic sales growth guidance range
of 9.5% to 10.0%, excluding COVID-19 testing-related sales(2).
-- Abbott now projects full-year diluted EPS on a GAAP basis of $3.34 to
$3.40 and projects adjusted diluted EPS of $4.64 to $4.70, which
represents an increase at the midpoint of the guidance range.
-- In October, Abbott's board of directors authorized a new share
repurchase program of up to $7 billion of the company's common shares.
-- In August, Abbott announced a unique global partnership with Medtronic
to collaborate on connecting Abbott's world-leading continuous glucose
monitoring (CGM) system with Medtronic's insulin delivery devices.
-- In September, Abbott announced the U.S. launch of Lingo((TM)), the
company's first continuous glucose monitoring system available without a
prescription and designed for people interested in improving their
overall health and wellness.
-- In September, Abbott announced a partnership with the Big Ten
Conference(®) to conduct a nationwide blood donation competition to
help increase the U.S. blood supply.
-- In September, Abbott completed enrollment ahead of schedule in its
VOLT-AF IDE trial, which is designed to evaluate the Volt((TM)) Pulsed
Field Ablation (PFA) System for treating patients with heart rhythm
disorders such as atrial fibrillation (AFib).
"Our results this quarter demonstrate the strength of our diversified business model," said Robert B. Ford, chairman and chief executive officer, Abbott. "We're well-positioned to achieve the upper end of our initial guidance ranges for the year and have great momentum heading into next year."
THIRD-QUARTER BUSINESS OVERVIEW
Management believes that measuring sales growth rates on an organic basis, which excludes the impact of foreign exchange and the impact of discontinuing the ZonePerfect(®) product line in the Nutrition business, 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.
Third Quarter 2024 Results (3Q24)
---
Sales 3Q24 ($ in millions) Total Company Nutrition Diagnostics Established Medical Devices
Pharmaceuticals
U.S. 4,202 950 1,032 2,216
International 6,433 1,116 1,380 1,406 2,531
Total reported 10,635 2,066 2,412 1,406 4,747
% Change vs. 3Q23
U.S. 10.1 10.4 1.8
n/a 14.2
International 1.7 (7.9) (3.8) 2.7 9.6
Total reported 4.9 (0.3) (1.5) 2.7 11.7
Impact of foreign exchange (2.5) (3.1) (2.9) (4.3) (1.6)
Impact of business exit* (0.2) (0.6)
Organic 7.6 3.4 1.4 7.0 13.3
Impact of COVID-19 testing sales (3) (0.6) (1.9)
Organic (excluding COVID-19 tests) 8.2 3.4 3.3 7.0 13.3
U.S. 11.0 11.9 2.4
n/a 14.2
International 6.5 (2.6) 3.8 7.0 12.5
First Nine Months 2024 Results (9M24)
---
Sales 9M24 ($ in millions) Total Company Nutrition Diagnostics Established Medical Devices
Pharmaceuticals
U.S. 11,982 2,761 2,775 6,435
International 18,994 3,523 4,046 3,926 7,499
Total reported 30,976 6,284 6,821 3,926 13,934
% Change vs. 9M23
U.S. 4.2 8.1 (16.2)
n/a 14.3
International 3.4 (1.1) (2.4) 2.1 10.1
Total reported 3.7 2.7 (8.5) 2.1 12.0
Impact of foreign exchange (3.0) (3.1) (2.9) (7.3) (1.6)
Impact of business exit and acquisition* 0.1 (0.4) 0.4
Organic 6.6 6.2 (5.6) 9.4 13.2
Impact of COVID-19 testing sales (3) (2.8) (10.4)
Organic (excluding COVID-19 tests) 9.4 6.2 4.8 9.4 13.2
U.S. 10.0 9.0 3.0
n/a 13.3
International 9.0 4.2 5.9 9.4 13.1
Refer to table titled "Non-GAAP Revenue Reconciliation" for a reconciliation of adjusted historical revenue to reported revenue.
*Quarter to date Sept. 30, 2024, reflects the impact of discontinuing the ZonePerfect(R) product line in the Nutrition business in March 2024. Year to date Sept. 30, 2024, 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
---
Third Quarter 2024 Results (3Q24)
---
Sales 3Q24 ($ in millions) Total Pediatric Adult
U.S. 950 568 382
International 1,116 387 729
Total reported 2,066 955 1,111
% Change vs. 3Q23
U.S. 10.4 12.2 7.9
International (7.9) (21.6) 1.5
Total reported (0.3) (4.5) 3.6
Impact of foreign exchange (3.1) (1.8) (4.4)
Impact of business exit* (0.6) (1.1)
Organic 3.4 (2.7) 9.1
U.S. 11.9 12.2 11.5
International (2.6) (18.0) 8.0
Worldwide Nutrition sales decreased 0.3 percent on a reported basis and increased 3.4 percent on an organic basis in the third quarter, led by growth in Adult Nutrition.
In Adult Nutrition, global sales increased 3.6 percent on a reported basis and 9.1 percent on an organic basis, which was led by growth of Ensure(®), Abbott's market-leading complete and balanced nutrition brand.
First Nine Months 2024 Results (9M24)
---
Sales 9M24 ($ in millions) Total Pediatric Adult
U.S. 2,761 1,646 1,115
International 3,523 1,377 2,146
Total reported 6,284 3,023 3,261
% Change vs. 9M23
U.S. 8.1 11.8 3.2
International (1.1) (6.8) 2.8
Total reported 2.7 2.5 3.0
Impact of foreign exchange (3.1) (1.6) (4.4)
Impact of business exit* (0.4) (0.7)
Organic 6.2 4.1 8.1
U.S. 9.0 11.8 5.0
International 4.2 (3.6) 9.7
*Reflects the impact of discontinuing the ZonePerfect(R) product line. This action was initiated in March 2024.
Diagnostics
---
Third Quarter 2024 Results (3Q24)
---
Sales 3Q24 ($ in millions) Total Core Laboratory Molecular Point of
Care Rapid
Diagnostics
U.S. 1,032 332 37 103 560
International 1,380 982 91 43 264
Total reported 2,412 1,314 128 146 824
% Change vs. 3Q23
U.S. 1.8 4.5 (2.8) 6.0 (0.2)
International (3.8) (1.5) (3.9) 0.7 (12.2)
Total reported (1.5) (3.6) 4.4 (4.4)
Impact of foreign exchange (2.9) (4.3) (1.5) (0.2) (1.4)
Organic 1.4 4.3 (2.1) 4.6 (3.0)
Impact of COVID-19 testing sales (3) (1.9) (0.2) (3.9) (3.4)
Organic (excluding COVID-19 tests) 3.3 4.5 1.8 4.6 0.4
U.S. 2.4 4.8 4.5 6.0 (1.0)
International 3.8 4.4 0.8 1.3 2.8
As expected, Diagnostics sales growth in the third quarter was negatively impacted by year-over-year declines in COVID-19 testing-related sales(3). Worldwide COVID-19 testing sales were $265 million in the third quarter of 2024 compared to $305 million in the third quarter of the prior year.
Excluding COVID-19 testing-related sales, global Diagnostics sales increased 0.2 percent on a reported basis and increased 3.3 percent on an organic basis.
Excluding COVID-19 testing-related sales, global Core Laboratory Diagnostics sales grew 0.1 percent on a reported basis and increased 4.5 percent on an organic basis, led by continued adoption of Abbott's Alinity(®) family of diagnostics systems and testing portfolios.
First Nine Months 2024 Results (9M24)
---
Sales 9M24 ($ in millions) Total Core Laboratory Molecular Point of
Care Rapid
Diagnostics
U.S. 2,775 969 112 308 1,386
International 4,046 2,879 272 133 762
Total reported 6,821 3,848 384 441 2,148
% Change vs. 9M23
U.S. (16.2) 5.6 (12.3) 6.6 (29.8)
International (2.4) 0.3 (7.2) 4.8 (10.6)
Total reported (8.5) 1.5 (8.7) 6.0 (24.0)
Impact of foreign exchange (2.9) (4.8) (0.8) (0.1) (1.1)
Organic (5.6) 6.3 (7.9) 6.1 (22.9)
Impact of COVID-19 testing sales (3) (10.4) (0.2) (6.3) (25.0)
Organic (excluding COVID-19 tests) 4.8 6.5 (1.6) 6.1 2.1
U.S. 3.0 5.9 (3.3) 6.6 (0.1)
International 5.9 6.7 (0.9) 5.1 5.7
Established Pharmaceuticals
---
Third Quarter 2024 Results (3Q24)
---
Sales 3Q24 ($ in millions) Total Key Emerging Other
Markets
U.S. -
International 1,406 994 412
Total reported 1,406 994 412
% Change vs. 3Q23
U.S. n/a n/a n/a
International 2.7 0.7 8.1
Total reported 2.7 0.7 8.1
Impact of foreign exchange (4.3) (4.7) (3.1)
Organic 7.0 5.4 11.2
U.S. n/a n/a n/a
International 7.0 5.4 11.2
Established Pharmaceuticals sales increased 2.7 percent on a reported basis and 7.0 percent on an organic basis in the third 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 increased 5.4 percent on an organic basis, led by growth in several geographies and therapeutic areas, including gastroenterology, cardiometabolic, and central nervous system/pain management.
First Nine Months 2024 Results (9M24)
---
Sales 9M24 ($ in millions) Total Key Emerging Other
Markets
U.S. -
International 3,926 2,910 1,016
Total reported 3,926 2,910 1,016
% Change vs. 9M23
U.S. n/a n/a n/a
International 2.1 0.7 6.4
Total reported 2.1 0.7 6.4
Impact of foreign exchange (7.3) (9.0) (2.2)
Organic 9.4 9.7 8.6
U.S. n/a n/a n/a
International 9.4 9.7 8.6
Medical Devices
---
Third Quarter 2024 Results (3Q24)
---
Sales 3Q24 ($ in millions) Total Rhythm Electro- Heart Vascular Structural Neuro- Diabetes
Management Failure Heart modulation Care
physiology
U.S. 2,216 288 285 252 258 270 190 673
International 2,531 309 325 70 441 288 46 1,052
Total reported 4,747 597 610 322 699 558 236 1,725
% Change vs. 3Q23
U.S. 14.2 6.0 15.8 16.7 2.8 21.1 0.8 23.6
International 9.6 5.7 9.2 5.2 4.5 9.2 17.8 13.3
Total reported 11.7 5.9 12.2 14.0 3.9 14.6 3.8 17.1
Impact of foreign exchange (1.6) (1.1) (2.1) (0.4) (1.0) (1.9) (1.4) (2.0)
Organic 13.3 7.0 14.3 14.4 4.9 16.5 5.2 19.1
U.S. 14.2 6.0 15.8 16.7 2.8 21.1 0.8 23.6
International 12.5 7.9 13.0 6.6 6.2 12.6 25.7 16.5
Worldwide Medical Devices sales increased 11.7 percent on a reported basis and 13.3 percent on an organic basis in the third quarter, including double-digit organic growth in both the U.S. and internationally.
Sales growth was led by double-digit growth in Diabetes Care, Structural Heart, Heart Failure, and Electrophysiology. Several products contributed to the strong performance, including FreeStyle Libre(®), Navitor(®), TriClip(®), Amplatzer(®) Amulet(®), and AVEIR(®).
In Electrophysiology, sales grew 12.2 percent on a reported basis and 14.3 percent on an organic basis, which included double-digit growth in catheters and cardiac mapping-related products.
In Diabetes Care, sales of continuous glucose monitors exceeded $1.6 billion and grew 19.1 percent on a reported basis and 20.7 percent on an organic basis.
First Nine Months 2024 Results (9M24)
---
Sales 9M24 ($ in millions) Total Rhythm Electro- Heart Vascular Structural Neuro- Diabetes
Management Failure Heart modulation Care
physiology
U.S. 6,435 851 841 733 787 761 563 1,899
International 7,499 915 983 215 1,325 876 142 3,043
Total reported 13,934 1,766 1,824 948 2,112 1,637 705 4,942
% Change vs. 9M23
U.S. 14.3 6.4 15.3 11.0 7.4 16.7 6.5 24.3
International 10.1 4.8 12.6 8.2 4.2 10.3 16.5 13.5
Total reported 12.0 5.6 13.8 10.4 5.4 13.2 8.4 17.4
Impact of foreign exchange (1.6) (1.2) (2.6) (0.1) (1.3) (1.9) (1.5) (1.9)
Impact of acquisition* 0.4 2.8
Organic 13.2 6.8 16.4 10.5 3.9 15.1 9.9 19.3
U.S. 13.3 6.4 15.3 11.0 0.1 16.7 6.5 24.3
International 13.1 7.1 17.4 8.9 6.0 13.7 24.6 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 $3.34 to $3.40. Abbott forecasts specified items for the full-year 2024 of $1.30 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 $4.64 to $4.70 for the full-year 2024.
Abbott projects fourth-quarter 2024 diluted earnings per share under GAAP of $0.96 to $1.02. Abbott forecasts specified items for the fourth-quarter 2024 of $0.35 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 $1.31 to $1.37 for the fourth quarter 2024.
ABBOTT DECLARES 403(RD )CONSECUTIVE QUARTERLY DIVIDEND
On Sept. 19, 2024, the board of directors of Abbott declared the company's quarterly dividend of $0.55 per share. Abbott's cash dividend is payable Nov. 15, 2024, to shareholders of record at the close of business on Oct. 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 third-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 third quarter of 2024, total worldwide sales were $10.635 billion and COVID-19 testing-related sales were $265 million. In the third quarter of 2023, total worldwide sales were $10.143 billion and COVID-19 testing-related sales were $305 million.
2 Abbott has not provided the related GAAP financial measure for organic sales growth, excluding COVID-19 testing-related sales, on a forward-looking basis because the company is unable to predict with reasonable certainty the impact of foreign exchange due to the
unpredictability of future changes in foreign exchange rates, which could significantly impact reported sales growth. In addition, as the COVID-19 pandemic has shifted to an endemic state, the company has determined that it is unable to predict with reasonable certainty future
COVID-19 test sales due to the unpredictability of demand for COVID-19 tests.
3
Diagnostic sales and COVID-19 testing-related sales in 2024 and 2023 are summarized below:
Sales 3Q24 COVID Tests Sales 3Q24
($ in millions) U.S. Int'l Total U.S. Int'l Total
Total Diagnostics 1,032 1,380 2,412 206 59 265
Core Laboratory 332 982 1,314 1 2 3
Molecular 37 91 128 2 1 3
Rapid Diagnostics 560 264 824 203 56 259
Sales 3Q23 COVID Tests Sales 3Q23
($ in millions) U.S. Int'l Total U.S. Int'l Total
Total Diagnostics 1,013 1,436 2,449 207 98 305
Core Laboratory 317 997 1,314 2 3 5
Molecular 38 95 133 5 3 8
Rapid Diagnostics 561 301 862 200 92 292
Sales 9M24 COVID Tests Sales 9M24
($ in millions) U.S. Int'l Total U.S. Int'l Total
Total Diagnostics 2,775 4,046 6,821 428 143 571
Core Laboratory 969 2,879 3,848 3 5 8
Molecular 112 272 384 7 3 10
Rapid Diagnostics 1,386 762 2,148 418 135 553
Sales 9M23 COVID Tests Sales 9M23
($ in millions) U.S. Int'l Total U.S. Int'l Total
Total Diagnostics 3,309 4,145 7,454 1,031 267 1,298
Core Laboratory 917 2,872 3,789 6 10 16
Molecular 128 293 421 19 17 36
Rapid Diagnostics 1,975 853 2,828 1,006 240 1,246
Abbott Laboratories and Subsidiaries
Condensed Consolidated Statement of Earnings
Third Quarter Ended September 30, 2024 and 2023
(in millions, except per share data)
(unaudited)
3Q24 3Q23 % Change
Net Sales $10,635 $10,143 4.9
Cost of products sold, excluding amortization expense 4,698 4,605 2.0
Amortization of intangible assets 470 496 (5.1)
Research and development 713 672 6.1
Selling, general, and administrative 2,895 2,723 6.3
Total Operating Cost and Expenses 8,776 8,496 3.3
Operating Earnings 1,859 1,647 12.8
Interest expense, net 51 69 (26.0)
Net foreign exchange (gain) loss (11) (10) n/m
Other (income) expense, net (121) (83) n/m
Earnings before taxes 1,940 1,671 16.1
Taxes on earnings 294 235 25.6
Net Earnings $1,646 $1,436 14.6
Net Earnings excluding Specified Items, as described below $2,119 $2,000 5.9 1)
Diluted Earnings per Common Share $0.94 $0.82 14.6
Diluted Earnings per Common Share, $1.21 $1.14 6.1 1)
excluding Specified Items, as described below
Average Number of Common Shares Outstanding 1,748 1,748
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 Net Earnings and Diluted Earnings per Common Share, excluding Specified Items, excludes net after-tax charges of $473 million, or $0.27 per share, for intangible amortization, charges related to intangible impairment, 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 $564 million, or $0.32 per share, for intangible amortization, charges related to the impairment of R&D intangible assets, expenses associated with
acquisitions, restructuring and cost reduction initiatives and other net expenses.
Abbott Laboratories and Subsidiaries
Condensed Consolidated Statement of Earnings
Nine Months Ended September 30, 2024 and 2023
(in millions, except per share data)
(unaudited)
9M24 9M23 % Change
Net Sales $30,976 $29,868 3.7
Cost of products sold, excluding amortization expense 13,764 13,419 2.6
Amortization of intangible assets 1,413 1,485 (4.9)
Research and development 2,095 2,041 2.6
Selling, general, and administrative 8,790 8,225 6.9
Total Operating Cost and Expenses 26,062 25,170 3.5
Operating Earnings 4,914 4,698 4.6
Interest expense, net 170 182 (6.4)
Net foreign exchange (gain) loss (17) 17 n/m
Other (income) expense, net (222) (370) n/m
Earnings before taxes 4,983 4,869 2.3
Taxes on earnings 810 740 9.6 1)
Net Earnings $4,173 $4,129 1.0
Net Earnings excluding Specified Items, as described below $5,851 $5,708 2.5 2)
Diluted Earnings per Common Share $2.38 $2.35 1.3
Diluted Earnings per Common Share, $3.33 $3.25 2.5 2)
excluding Specified Items, as described below
Average Number of Common Shares Outstanding 1,749 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 $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 $59 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 $1.678 billion, or $0.95 per share, for intangible amortization, charges related to intangible impairment, 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 $1.579 billion, or $0.90 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
Third Quarter Ended September 30, 2024 and 2023
(in millions, except per share data)
(unaudited)
3Q24
As Specified As
Items
Reported Adjusted
(GAAP)
Intangible Amortization $470 $(470)
$ -
Gross Margin 5,467 516 5,983
R&D 713 (19) 694
SG&A 2,895 (5) 2,890
Other (income) expense, net (121) (12) (133)
Earnings before taxes 1,940 552 2,492
Taxes on Earnings 294 79 373
Net Earnings 1,646 473 2,119
Diluted Earnings per Share $0.94 $0.27 $1.21
Specified items reflect intangible amortization expense of $470 million and other net expenses of $82 million associated with charges related to intangible impairment, acquisitions, a divestiture and other net expenses. See table titled "Details of Specified Items" for additional details regarding specified items.
3Q23
As Specified As
Items
Reported Adjusted
(GAAP)
Intangible Amortization $496 $(496)
$ -
Gross Margin 5,042 542 5,584
R&D 672 (46) 626
SG&A 2,723 (43) 2,680
Other (income) expense, net (83) (23) (106)
Earnings before taxes 1,671 654 2,325
Taxes on Earnings 235 90 325
Net Earnings 1,436 564 2,000
Diluted Earnings per Share $0.82 $0.32 $1.14
Specified items reflect intangible amortization expense of $496 million and other net expenses of $158 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
Nine Months Ended September 30, 2024 and 2023
(in millions, except per share data)
(unaudited)
9M24
As Specified As
Items
Reported Adjusted
(GAAP)
Intangible Amortization $1,413 $(1,413)
$ -
Gross Margin 15,799 1,540 17,339
R&D 2,095 (81) 2,014
SG&A 8,790 (96) 8,694
Other (income) expense, net (222) (183) (405)
Earnings before taxes 4,983 1,900 6,883
Taxes on Earnings 810 222 1,032
Net Earnings 4,173 1,678 5,851
Diluted Earnings per Share $2.38 $0.95 $3.33
Specified items reflect intangible amortization expense of $1.413 billion and other net expenses of $487 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.
9M23
As Specified As
Items
Reported Adjusted
(GAAP)
Intangible Amortization $1,485 $(1,485)
$ -
Gross Margin 14,964 1,591 16,555
R&D 2,041 (144) 1,897
SG&A 8,225 (67) 8,158
Other (income) expense, net (370) 34 (336)
Earnings before taxes 4,869 1,768 6,637
Taxes on Earnings 740 189 929
Net Earnings 4,129 1,579 5,708
Diluted Earnings per Share $2.35 $0.90 $3.25
Specified items reflect intangible amortization expense of $1.485 billion and other net expenses of $283 million associated with restructuring actions, costs associated with acquisitions and other expenses. See table titled "Details of Specified Items" for additional details regarding specified items.
A reconciliation of the third-quarter tax rates for 2024 and 2023 is shown below:
3Q24
($ in millions) Pre-Tax Taxes on Tax
Income Earnings Rate
As reported (GAAP) $1,940 $294 15.2 %
Specified items 552 79
Excluding specified items $2,492 $373 15.0 %
3Q23
($ in millions) Pre-Tax Taxes on Tax
Income Earnings Rate
As reported (GAAP) $1,671 $235 14.0 %
Specified items 654 90
Excluding specified items $2,325 $325 14.0 %
A reconciliation of the year-to-date tax rates for 2024 and 2023 is shown below:
9M24
($ in millions) Pre-Tax Taxes on Tax
Income Earnings Rate
As reported (GAAP) $4,983 $810 16.3 % 1)
Specified items 1,900 222
Excluding specified items $6,883 $1,032 15.0 %
9M23
($ in millions) Pre-Tax Taxes on Tax
Income Earnings Rate
As reported (GAAP) $4,869 $740 15.2 % 2)
Specified items 1,768 189
Excluding specified items $6,637 $929 14.0 %
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.
2) 2023 Taxes on Earnings includes the recognition of approximately $59 million of net tax expense as a result of the resolution of
various tax positions related to prior years.
Abbott Laboratories and Subsidiaries
Non-GAAP Revenue Reconciliation
Third Quarter and Nine Months Ended September 30, 2024 and 2023
($ in millions)
(unaudited)
3Q24
3Q23 % Change vs. 3Q23
Non-GAAP
Abbott Impact from Adjusted Abbott Impact from Adjusted Reported Adjusted Organic
Reported business exit Revenue Reported business exit
(b) (b) Revenue
Total Company 10,635 (5) 10,630 10,143 (17) 10,126 4.9 5.1 7.6
U.S. 4,202 (5) 4,197 3,817 (17) 3,800 10.1 10.4 10.4
Intl 6,433 6,433 6,326 6,326 1.7 1.7 5.8
Total Nutrition 2,066 (5) 2,061 2,073 (17) 2,056 (0.3) 0.3 3.4
U.S. 950 (5) 945 860 (17) 843 10.4 11.9 11.9
Intl 1,116 1,116 1,213 1,213 (7.9) (7.9) (2.6)
Adult Nutrition 1,111 (5) 1,106 1,072 (17) 1,055 3.6 4.7 9.1
U.S. 382 (5) 377 354 (17) 337 7.9 11.5 11.5
Intl 729 729 718 718 1.5 1.5 8.0
Total Medical Devices 4,747 4,747 4,249 4,249 11.7 11.7 13.3
U.S. 2,216 2,216 1,940 1,940 14.2 14.2 14.2
Intl 2,531 2,531 2,309 2,309 9.6 9.6 12.5
Vascular 699 699 672 672 3.9 3.9 4.9
U.S. 258 258 251 251 2.8 2.8 2.8
Intl 441 441 421 421 4.5 4.5 6.2
9M24
9M23 % Change vs. 9M23
Non-GAAP
Abbott Impact of Impact Adjusted Abbott Impact
from from Adjusted Reported Adjusted Organic
Reported acquisition
(a) business Revenue Reported business Revenue
exit (b) exit (b)
Total Company 30,976 (57) (13) 30,906 29,868 (32) 29,836 3.7 3.6 6.6
U.S. 11,982 (53) (13) 11,916 11,503 (32) 11,471 4.2 3.9 3.9
Intl 18,994 (4) 18,990 18,365 18,365 3.4 3.4 8.3
Total Nutrition 6,284 (13) 6,271 6,116 (32) 6,084 2.7 3.1 6.2
U.S. 2,761 (13) 2,748 2,553 (32) 2,521 8.1 9.0 9.0
Intl 3,523 3,523 3,563 3,563 (1.1) (1.1) 4.2
Adult Nutrition 3,261 (13) 3,248 3,167 (32) 3,135 3.0 3.7 8.1
U.S. 1,115 (13) 1,102 1,081 (32) 1,049 3.2 5.0 5.0
Intl 2,146 2,146 2,086 2,086 2.8 2.8 9.7
Total Medical Devices 13,934 (57) 13,877 12,444 12,444 12.0 11.6 13.2
U.S. 6,435 (53) 6,382 5,631 5,631 14.3 13.3 13.3
Intl 7,499 (4) 7,495 6,813 6,813 10.1 10.0 13.1
Vascular 2,112 (57) 2,055 2,004 2,004 5.4 2.6 3.9
U.S. 787 (53) 734 733 733 7.4 0.1 0.1
Intl 1,325 (4) 1,321 1,271 1,271 4.2 3.9 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
Third Quarter Ended September 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 $470 $44 $516
R&D - (19) (19)
SG&A (7) 2 (5)
Other (income) expense, net (5) (7) (12)
Earnings before taxes $12
$ - $470 $70 552
Taxes on Earnings (d) 79
Net Earnings $473
Diluted Earnings per Share $0.27
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 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
investment and intangible asset impairment charges.
d)
Reflects the net tax benefit associated with the specified items.
Abbott Laboratories and Subsidiaries
Details of Specified Items
Third Quarter Ended September 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 $3 $19 $496 $24 $542
R&D (1) (13) (32) (46)
SG&A (22) (22) 1 (43)
Other (income) expense, net 5 (28) (23)
Earnings before taxes $21 $54 $496 $83 654
Taxes on Earnings (d) 90
Net Earnings $564
Diluted Earnings per Share $0.32
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 acquired businesses, as well as legal and 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 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.
Abbott Laboratories and Subsidiaries
Details of Specified Items
Nine Months Ended September 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 $76 $1,413 $49 $1,540
R&D (4) (1) (76) (81)
SG&A (32) (17) (47) (96)
Other (income) expense, net (140) (43) (183)
Earnings before taxes $178 $94 $1,413 $215 1,900
Taxes on Earnings (d) 222
Net Earnings $1,678
Diluted Earnings per Share $0.95
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
Nine Months Ended September 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 $15 $51 $1,485 $40 $1,591
R&D (13) (5) (126) (144)
SG&A (43) (28) 4 (67)
Other (income) expense, net 46 (12) 34
Earnings before taxes $25 $84 $1,485 $174 1,768
Taxes on Earnings (d) 189
Net Earnings $1,579
Diluted Earnings per Share $0.90
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 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
