10-Q/APeriod: Q1 FY2002

PFIZER INC Quarterly Report (Amendment) for Q1 Ended Mar 31, 2002

Filed May 16, 2002For Securities:PFE

Summary

Pfizer Inc. reported strong financial performance for the first quarter ended March 31, 2002, with a significant increase in net income and revenues compared to the prior year. Total revenues grew by 11% to $8.4 billion, driven by a 11.7% increase in sales volume, particularly from key pharmaceutical products like Lipitor and Neurontin, and revenue from product alliances. Net income surged by 22% to $2.36 billion, translating to diluted earnings per share of $0.37, up from $0.30 in the same period last year. The company also demonstrated solid operational cash flow, generating $1.57 billion from operating activities. While investing activities used more cash compared to the previous year, primarily due to increased investment purchases, and financing activities also used more cash due to higher share repurchases and dividends, Pfizer maintained a strong liquidity position with $10.14 billion in cash and equivalents and short-term investments. The company reaffirmed its full-year diluted EPS target of $1.56-$1.60, signaling confidence in continued growth.

Key Highlights

  • 1Revenues increased by 11% to $8.4 billion, driven by volume growth and product alliances.
  • 2Net income rose by 22% to $2.36 billion, with diluted EPS reaching $0.37.
  • 3Pharmaceuticals segment revenue grew 12%, with human pharmaceuticals up 13% and key products like Lipitor, Neurontin, and Zoloft showing strong performance.
  • 4Operating cash flow remained robust at $1.57 billion.
  • 5The company is actively managing its capital structure, with significant share repurchases and dividend payments.
  • 6Pfizer reaffirmed its full-year diluted EPS guidance, demonstrating confidence in continued financial performance.
  • 7Adoption of new accounting standards (SFAS 141, 142, 144) and EITF 01-09 had minimal impact on current financial results, with a one-time charge for identifiable intangible assets.

Frequently Asked Questions

In the first quarter of 2002, Pfizer reported total revenues of $8.418 billion, an increase of 11% compared to $7.584 billion in the first quarter of 2001. Net income also saw a significant rise of 22%, reaching $2.356 billion, up from $1.930 billion in the prior year period. This resulted in diluted earnings per share of $0.37 for Q1 2002, compared to $0.30 for Q1 2001.

The revenue growth was primarily driven by an 11.7% increase in sales volume and contributions from product alliances. Key pharmaceutical products, including Lipitor, Neurontin, and Zoloft, demonstrated strong growth, accounting for a substantial portion of the company's pharmaceutical revenues. The Pharmaceuticals segment, encompassing human pharmaceuticals and animal health, grew by 12% overall.

Pfizer generated $1.574 billion in net cash provided by operating activities during the first quarter of 2002. The company maintained a strong liquidity position, with cash and cash equivalents and short-term investments totaling $10.143 billion. While the company engaged in significant share repurchases and dividend payments, its financial condition remained solid.

Pfizer adopted new accounting standards, including SFAS 141, 142, and 144, which primarily affect business combinations, goodwill, and intangible assets. While SFAS 142 eliminated the amortization of goodwill and certain intangibles, the company recorded a one-time non-cash charge of $17 million after-tax in the first quarter of 2002 related to the impairment of identifiable intangible assets. The adoption of these standards did not have a material impact on the company's current financial position or operating results.