On April 20, 2022 Abbott (NYSE: ABT) reported financial results for the first quarter ended March 31, 2022 (Press release, Abbott, APR 20, 2022, View Source [SID1234612573]).
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First-quarter sales of $11.9 billion increased 13.8 percent on a reported basis and 17.5 percent on an organic basis, which excludes the impact of foreign exchange.
First-quarter GAAP diluted EPS1 was $1.37 and adjusted diluted EPS, which excludes specified items, was $1.73.
Global COVID-19 testing-related sales were $3.3 billion in the first quarter.
Abbott projects full-year 2022 diluted EPS on a GAAP basis of at least $3.35 and projected adjusted diluted EPS of at least $4.70 remains unchanged.
2022 guidance includes projected COVID-19 testing-related sales of approximately $4.5 billion, which Abbott expects to largely occur in the first half of the year and will update on a quarterly basis.
In February, Abbott initiated a voluntary recall of certain infant formula products manufactured at one of its U.S. facilities. Abbott is working closely with the U.S. Food and Drug Administration (FDA) and has begun implementing corrective actions and enhancements to the facility.
In February, Abbott received FDA approval for an expanded indication for its CardioMEMS HF system, a small implantable sensor and remote monitoring system that can detect early warning signs of worsening heart failure.
In March, Abbott announced its FreeStyle Libre system is the first and only continuous glucose monitoring (CGM) system to gain expanded reimbursement in Japan to now include all people with diabetes who use insulin.
In April, Abbott announced FDA approval for its Aveir single-chamber leadless pacemaker for the treatment of patients in the U.S. with slow heart rhythms. Unlike traditional pacemakers, leadless pacemakers do not require an incision in the chest to implant or leads (wires) to deliver therapy.
"Our diversified business continues to perform well in a challenging environment," said Robert B. Ford, chairman and chief executive officer, Abbott. "We’re particularly pleased with the strong performance we’re achieving in Medical Devices and Established Pharmaceuticals."
FIRST-QUARTER BUSINESS OVERVIEW
Note: Management believes that measuring sales growth rates on an organic basis is an appropriate way for investors to best understand the underlying performance of the business. Organic sales growth excludes the impact of foreign exchange.
Following are sales by business segment and commentary for the first quarter 2022:
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.
First-quarter 2022 worldwide sales of $11.9 billion increased 13.8 percent on a reported basis and 17.5 percent on an organic basis.
Worldwide sales, excluding COVID-19 testing-related sales, increased 3.9 percent on a reported basis and 7.7 percent on an organic basis in the quarter.2
Worldwide Nutrition sales decreased 7.0 percent on a reported basis and 4.4 percent on an organic basis in the first quarter. During the quarter, sales were negatively impacted by a voluntary recall of certain powder formulas manufactured at one of Abbott’s U.S. plants. Excluding the U.S. sales associated with these products in the current and prior years, worldwide Nutrition sales increased 5.0 percent on a reported basis and 8.0 percent on an organic basis in the first quarter.3
In Adult Nutrition, strong performance of Ensure, Abbott’s market-leading complete and balanced nutrition brand, and Glucerna, Abbott’s market-leading diabetes nutrition brand, led to global sales growth of 8.0 percent on a reported basis and 11.5 percent on an organic basis.
Worldwide Pediatric Nutrition sales decreased 20.6 percent on a reported basis and 18.8 percent on an organic basis. Internationally, Pediatric Nutrition sales were unfavorably impacted primarily by challenging market conditions in China.
Worldwide Diagnostics sales increased 31.7 percent on a reported basis and 35.1 percent on an organic basis in the first quarter. Global COVID-19 testing-related sales were $3.3 billion in the quarter, led by sales of rapid testing products.
Sales in Core Laboratory and Molecular Diagnostics were impacted by year-over-year declines in COVID-19 testing-related sales in these businesses. Excluding COVID-19 testing-related sales, Core Laboratory Diagnostics sales and Molecular Diagnostics sales increased 2.4 percent and 24.8 percent, respectively, on a reported basis in the first quarter and 6.6 percent and 29.0 percent, respectively, on an organic basis.4
Established Pharmaceuticals sales increased 7.1 percent on a reported basis in the first quarter and increased 13.4 percent on an organic basis.
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 9.8 percent on a reported basis in the quarter and increased 17.1 percent on an organic basis, led by double-digit growth on a reported and organic basis in several geographies and therapeutic areas, including gastroenterology, respiratory and central nervous system/pain management.
Other sales decreased 1.7 percent on a reported basis and increased 1.2 percent on an organic basis in the quarter.
Worldwide Medical Devices sales increased 7.4 percent on a reported basis and 11.5 percent on an organic basis in the first quarter. Strong growth in the quarter was driven by double-digit organic growth in Electrophysiology, Heart Failure, Structural Heart and Diabetes Care.
In Diabetes Care, FreeStyle Libre sales were approximately $1.0 billion in the quarter, which represents sales growth of 20.4 percent on a reported basis and 26.2 percent on an organic basis.
ABBOTT’S EARNINGS-PER-SHARE GUIDANCE
Abbott projects full-year 2022 diluted earnings per share under GAAP of at least $3.35. Abbott forecasts specified items for the full-year 2022 of $1.35 per share primarily related to intangible amortization, costs related to a voluntary recall, expenses associated with acquisitions, restructurings and cost reduction initiatives and other net expenses. Excluding specified items, projected adjusted diluted earnings per share of at least $4.70 remains unchanged for the full-year 2022.
ABBOTT DECLARES 393RD CONSECUTIVE QUARTERLY DIVIDEND
On Feb. 18, 2022, the board of directors of Abbott declared the company’s quarterly dividend of $0.47 per share. Abbott’s cash dividend is payable May 16, 2022 to shareholders of record at the close of business on April 15, 2022.
Abbott has increased its dividend payout for 50 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.