8-KEarnings & ResultsRegulation FDExhibits & Filings

ABBOTT LABORATORIES 8-K Report, Financial Results (Jan 24, 2007)

Filed January 24, 2007For Securities:ABT

Summary

Abbott Laboratories (ABT) filed an 8-K on January 24, 2007, to announce its fourth-quarter and full-year 2006 results, and more importantly, to provide detailed earnings-per-share (EPS) guidance for the full year 2007 and each quarter. The company's guidance for 2007, excluding specified items, is projected to be between $2.77 and $2.83 per share. This forecast incorporates the significant strategic shift resulting from the sale of its core laboratory and point of care diagnostic businesses, expected in the first half of 2007. The net effect of 'specified items' for 2007 is anticipated to be a gain of approximately $2.00 per share, largely driven by an estimated $2.25 per share gain from the diagnostic business divestiture, partially offset by integration and restructuring costs.

Key Highlights

  • 1Abbott announced its Q4 and full-year 2006 results, with specific financial details provided in an accompanying press release (Exhibit 99.1).
  • 2The company is issuing full-year 2007 EPS guidance (excluding specified items) of $2.77 to $2.83.
  • 3This 2007 guidance reflects the sale of Abbott's core laboratory and point of care diagnostic businesses, expected in H1 2007.
  • 4A net gain of approximately $2.00 per share from 'specified items' is projected for full-year 2007, including a significant gain from the diagnostic business sale.
  • 5Quarterly EPS guidance (excluding specified items) for 2007 ranges from $0.51-$0.53 (Q1), $0.67-$0.69 (Q2), $0.64-$0.66 (Q3), and $0.94-$0.96 (Q4).
  • 6The company expects EPS growth to accelerate throughout 2007 due to product momentum and cost synergies from recent acquisitions and divestitures.
  • 7Abbott utilizes non-GAAP financial measures, adjusting for unusual items, and advises investors to consider these alongside GAAP measures.

Frequently Asked Questions

This 8-K primarily reports Abbott Laboratories' fourth-quarter and full-year 2006 results and provides detailed earnings-per-share (EPS) guidance for fiscal year 2007, including quarterly breakdowns. It also discloses the planned divestiture of its core laboratory and point of care diagnostic businesses.

Abbott forecasts its 2007 EPS, excluding specified items, to be in the range of $2.77 to $2.83. Including estimated specified items, which are expected to be a net gain of approximately $2.00 per share, the projected GAAP EPS for 2007 is $4.77 to $4.83.

The sale of the core laboratory and point of care diagnostic businesses, expected in the first half of 2007, is a significant factor in the 2007 guidance. It contributes an estimated gain of $2.25 per share to the 'specified items' for the year, which is partially offset by integration and restructuring costs.

'Specified items' are non-GAAP financial measures that Abbott's management uses to present ongoing business performance. These are adjustments for factors that are unusual or unpredictable, such as merger-related costs, purchase accounting adjustments, restructuring charges, litigation charges, and the impact of changes in laws and regulations. The company cautions that these should be considered alongside, not as a substitute for, GAAP measures.