Summary
Pfizer Inc. reported a decrease in revenues for the second quarter and first six months of 2012 compared to the prior year, primarily due to the loss of exclusivity for key products like Lipitor, alongside unfavorable foreign exchange impacts. Despite the revenue decline, the company saw an increase in income from continuing operations, driven by lower operating expenses, including reduced cost of sales, selling, informational, and administrative expenses, and research and development costs. This was partially offset by increased charges related to certain legal matters. Key strategic initiatives include the planned IPO of its Animal Health business, Zoetis, and the sale of its Nutrition business to Nestlé, both expected in the first half of 2013. The company continued its share repurchase program and maintained its dividend payments, demonstrating a focus on returning capital to shareholders. Management remains confident in the company's liquidity and ability to meet its financial obligations despite the challenging global economic environment and industry-specific pressures.
Financial Highlights
52 data points| Revenue | $12.95B |
| Cost of Revenue | $2.31B |
| Gross Profit | $10.64B |
| SG&A Expenses | $3.49B |
| Operating Income | $7.52B |
| Interest Expense | $381.00M |
| Net Income | $3.21B |
| EPS (Basic) | $0.43 |
| EPS (Diluted) | $0.43 |
| Shares Outstanding (Basic) | 7.44B |
| Shares Outstanding (Diluted) | 7.51B |
Key Highlights
- 1Revenues decreased by 9% in Q2 2012 and 8% in the first six months of 2012 compared to the prior year, largely attributed to Lipitor's loss of exclusivity and foreign exchange headwinds.
- 2Income from continuing operations increased by 27% in Q2 and 6% in the first six months of 2012 year-over-year, benefiting from significant reductions in operating expenses.
- 3Restructuring charges and acquisition-related costs decreased significantly by 64% in Q2 and 34% in the first six months of 2012, reflecting ongoing cost-reduction initiatives.
- 4"Other deductions—net" increased by 57% in Q2 and 85% in the first six months of 2012, primarily due to higher charges for litigation, including hormone-replacement therapy and Celebrex-related settlements.
- 5The company is progressing with the planned IPO of its Animal Health business, Zoetis, targeted for the first half of 2013, and the sale of its Nutrition business to Nestlé, also expected in the first half of 2013.
- 6Diluted earnings per common share attributable to Pfizer Inc. common shareholders increased by 30% in Q2 and 10% in the first six months of 2012 year-over-year.
- 7The effective tax rate on continuing operations slightly decreased in Q2 and the first six months of 2012 compared to the prior year.