-- Increases 2008 Net Sales Projections; Affirms Top End of Adjusted*
Earnings Guidance --
LAKE FOREST, Ill., Aug. 6 /PRNewswire-FirstCall/ -- Hospira, Inc.
(NYSE: HSP), a leading global specialty pharmaceutical and medication
delivery company, today reported results for the second quarter of 2008.
-- Net sales increased 3.7 percent to $901.6 million during the second
quarter of 2008, compared to $869.3 million during the second quarter
of 2007.
-- Adjusted* diluted earnings per share during the second quarter of 2008
were $0.57 compared to $0.49 during the second quarter last year. GAAP
second-quarter 2008 diluted earnings per share were $0.43 versus $0.20
for the same period last year. (Adjusted* measures exclude certain
specified items as described later in this press release and attached
schedules.)
"We made substantial progress advancing our business during the second
quarter and remain on track to deliver another good year," said Christopher
B. Begley, chairman and chief executive officer. "The market-share gains we
are capturing in both Specialty Injectable Pharmaceuticals and Medication
Management Systems point to the value of our focus on strategic execution.
With our solid year-to-date results and expectations for the remainder of
the year, we are increasing our full-year sales guidance and narrowing our
adjusted* EPS guidance to the top end of our projected range."
Second-quarter Financial Highlights
The following table summarizes selected financial results for the
quarters ended June 30:
In $ millions GAAP Adjusted*
Three Months Ended Three Months Ended
June 30, June 30,
---------------- % ---------------- %
2008 2007 Change 2008 2007 Change
------ ------ ------ ------ ------ ------
Net Sales $901.6 $869.3 3.7% $901.6 $869.3 3.7%
Gross Profit $329.4 $266.2 23.7% $357.1 $328.2 8.8%
R&D $58.5 $52.6 11.2% $57.4 $52.1 10.2%
Acquired In-
process R&D $0.5 -- nm -- -- nm
SG&A $152.7 $146.0 4.6% $147.5 $137.0 7.7%
Income from
Operations $117.7 $67.6 74.1% $152.2 $139.1 9.4%
Statistics (as a % of Net Sales)
--------------------------------
Gross Profit 36.5% 30.6% 39.6% 37.8%
R&D 6.5% 6.0% 6.4% 6.0%
SG&A 16.9% 16.8% 16.4% 15.8%
Income from
Operations 13.1% 7.8% 16.9% 16.0%
Results under U.S. Generally Accepted Accounting Principles (GAAP)
include items as detailed in the schedules attached to this release.
Net sales for the second quarter of 2008 increased 3.7 percent. On a
constant-currency basis, net sales were essentially even with the second
quarter of 2007. Strong sales in Medication Management Systems were offset
by softness in the U.S. Specialty Injectables and Other Pharmaceuticals
product lines.
Net sales in the Americas segment totaled $677.2 million, an increase
of 2.4 percent. Driving the increase was growth in Medication Management
Systems, which was partially offset by wholesaler purchasing patterns in
Specialty Injectables and decreased demand from some contract manufacturing
customers. Net sales in the Europe, Middle East and Africa (EMEA) and the
Asia-Pacific (APAC) segments increased 6.7 percent and 10.4 percent
respectively, driven by the impact of foreign exchange.
A schedule detailing net sales by segment and product line for the
three- and six-month periods ended June 30, 2008 and 2007 is attached to
this press release.
Adjusted* income from operations for the second quarter of 2008 was
$152.2 million, up 9.4 percent. The growth was driven by improved adjusted*
gross profit performance, partially offset by increases in adjusted*
Research and Development (R&D) and adjusted* Selling, General and
Administrative (SG&A) expenses. The increase in adjusted* R&D was driven by
investments in drug development activities as well as the impact of foreign
exchange. Adjusted* SG&A spending grew due to increased support for sales
and marketing of new products, primarily in the EMEA and APAC segments, as
well as the impact of foreign exchange.
Cash Flow
Cash flow from operations for the first six months of 2008 was $182.6
million, up from $171.6 million for the same period in 2007. Capital
expenditures were $86.7 million for the first six months of 2008, compared
with $88.5 million for the same period in 2007.
2008 Projections
Hospira has increased the projected range for net sales growth for
2008. Net sales for the full year are now expected to increase 8 to 10
percent, including the impact of foreign currency.
The company has narrowed the projected range for full-year 2008
adjusted* diluted earnings per share to be between $2.50 and $2.55. The
reconciliation between the projected adjusted* diluted earnings per share
and GAAP diluted earnings per share follows:
Diluted earnings per share -- adjusted* $2.50 - $2.55
--------------
Estimated charges related to planned facilities
optimization initiatives (mid-point of an estimated
range of $0.09 to $0.11 per diluted share for 2008) ($0.10)
Estimated integration and other acquisition-related
expenses (high end of an estimated range of $0.10 to
$0.12 per diluted share for 2008) ($0.12)
Estimated $62 million for the amortization of intangibles
related to the Mayne Pharma acquisition ($0.26)
--------------
Diluted earnings per share -- GAAP $2.02 - $2.07
==============
The company continues to project that cash flow from operations in 2008
will be in the $575 million to $625 million range. Depreciation and
amortization, excluding amortization of intangibles related to the Mayne
Pharma acquisition, are now projected to be between $190 million and $200
million. Capital expenditures are estimated to be between $190 million and
$210 million for 2008.
*Use of Non-GAAP Financial Measures
Non-GAAP financial measures used in this press release are referred to
as "adjusted" and are reconciled to the most comparable measures calculated
in accordance with GAAP in the schedules attached to this release. For more
information regarding these non-GAAP financial measures, please see
Hospira's Current Report on Form 8-K furnished to the Securities and
Exchange Commission on the date of this press release.
Webcast
A conference call for investors and media will be held at 8 a.m.
Central time on Wednesday, Aug. 6, 2008. A live webcast of the conference
call will be available at http://www.hospirainvestor.com. Listeners should log on
approximately 10 minutes in advance to ensure proper computer setup for
receiving the webcast. A replay will be available on the Hospira Web site
for 30 days following the call.
About Hospira
Hospira, Inc. is a global specialty pharmaceutical and medication
delivery company dedicated to Advancing Wellness(TM). As the world leader
in specialty generic injectable pharmaceuticals, Hospira offers one of the
broadest portfolios of generic acute-care and oncology injectables, as well
as integrated infusion therapy and medication management solutions. Through
its products, Hospira helps improve the safety, cost and productivity of
patient care. The company is headquartered in Lake Forest, Ill., and has
more than 14,000 employees. Learn more at http://www.hospira.com.
Private Securities Litigation Reform Act of 1995 --
A Caution Concerning Forward-Looking Statements This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, including
projections of certain measures of Hospira's results of operations,
projections of certain charges and expenses, statements regarding the
financial impact of the acquisition of Mayne Pharma, and other statements
regarding Hospira's goals, strategy, expectations and commitments. Hospira
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 Hospira's
operations and may cause actual results to be materially different from
expectations include the risks, uncertainties and factors discussed under
the headings "Risk Factors" and "Management's Discussion and Analysis of
Financial Condition and Results of Operations" in Hospira's latest Annual
Report on Form 10-K, and Hospira's subsequent Quarterly Reports on Form
10-Q, which are filed with the Securities and Exchange Commission, and
incorporated by reference. Hospira undertakes no obligation to release
publicly any revisions to forward-looking statements as the result of
subsequent events or developments.
Hospira, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
(dollars and shares in millions, except for per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
---------------- % ------------------ %
2008 2007 Change 2008 2007 Change
------ ------ ------ -------- -------- ------
Net sales $901.6 $869.3 3.7 % $1,790.3 $1,652.1 8.4 %
Cost of
products sold 572.2 603.1 (5.1)% 1,146.9 1,111.3 3.2 %
------ ------ -------- --------
Gross Profit 329.4 266.2 23.7 % 643.4 540.8 19.0 %
Research and
development 58.5 52.6 11.2 % 108.4 96.1 12.8 %
Acquired
in-process
research and
development 0.5 - nm 0.5 84.8 (99.4)%
Selling,
general and
administrative 152.7 146.0 4.6 % 305.1 277.9 9.8 %
------ ------ -------- --------
Income From
Operations 117.7 67.6 74.1 % 229.4 82.0 179.8 %
Interest expense 28.2 37.3 (24.4)% 59.6 67.8 (12.1)%
Other income, net - (5.2) (100.0)% (4.1) (5.8) (29.3)%
------ ------ -------- --------
Income Before
Income Taxes 89.5 35.5 152.1 % 173.9 20.0 769.5 %
Income tax expense 20.4 4.8 325.0 % 39.4 18.7 110.7 %
------ ------ -------- --------
Net Income $69.1 $30.7 125.1 % $134.5 $1.3 10,246.2 %
====== ====== ======== ========
Earnings Per
Common Share:
Basic $0.43 $0.20 115.0 % $0.85 $0.01 8,400.0 %
====== ====== ======== ========
Diluted $0.43 $0.20 115.0 % $0.83 $0.01 8,200.0 %
====== ====== ======== ========
Weighted Average
Common Shares
Outstanding:
Basic 159.1 156.7 1.5 % 158.9 156.4 1.6 %
====== ====== ======== ========
Diluted 161.5 159.5 1.3 % 161.2 159.0 1.4 %
====== ====== ======== ========
Hospira, Inc.
Reconciliation of Condensed Consolidated Statements of Income
(Unaudited)
(dollars and shares in millions, except per share amounts)
Three Months Ended June 30,
-------------------------------------------------------
2008 2007
-------------------------- --------------------------
GAAP Adjustments Adjusted GAAP Adjustments Adjusted
------ ------ ------ ------ ------ ------
Net sales $901.6 $ - $901.6 $869.3 $ - $869.3
Cost of
products sold 572.2 (27.7)A 544.5 603.1 (62.0)F 541.1
------ ------ ------ ------ ------ ------
Gross Profit 329.4 27.7 357.1 266.2 62.0 328.2
Research and
development 58.5 (1.1)B 57.4 52.6 (0.5)D 52.1
Acquired
in-process
research and
development 0.5 (0.5)C - - - -
Selling,
general and
administrative 152.7 (5.2)D 147.5 146.0 (9.0)D 137.0
------ ------ ------ ------ ------ ------
Income From
Operations 117.7 34.5 152.2 67.6 71.5 139.1
Interest expense 28.2 - 28.2 37.3 - 37.3
Other income,
net - - - (5.2) - (5.2)
------ ------ ------ ------ ------ ------
Income Before
Income Taxes 89.5 34.5 124.0 35.5 71.5 107.0
Income tax
expense 20.4 11.2 E 31.6 4.8 24.1 E 28.9
------ ------ ------ ------ ------ ------
Net Income $69.1 $23.3 $92.4 $30.7 $47.4 $78.1
====== ====== ====== ====== ====== ======
Earnings Per
Common Share:
Basic $0.43 $0.15 $0.58 $0.20 $0.30 $0.50
====== ====== ====== ====== ====== ======
Diluted $0.43 $0.14 $0.57 $0.20 $0.29 $0.49
====== ====== ====== ====== ====== ======
Weighted Average
Common Shares
Outstanding:
Basic 159.1 159.1 159.1 156.7 156.7 156.7
====== ====== ====== ====== ====== ======
Diluted 161.5 161.5 161.5 159.5 159.5 159.5
====== ====== ====== ====== ====== ======
Statistics
(as a % of
Net Sales,
except for
income tax rate)
-----------------
Gross Profit 36.5% 39.6% 30.6% 37.8%
R&D 6.5% 6.4% 6.0% 6.0%
SG&A 16.9% 16.4% 16.8% 15.8%
Income From
Operations 13.1% 16.9% 7.8% 16.0%
Income Before
Income Taxes 9.9% 13.8% 4.1% 12.3%
Net Income 7.7% 10.2% 3.5% 9.0%
Income Tax Rate 22.8% 25.5% 13.5% 27.0%
% Change vs. Prior Year
----------------------
GAAP Adjusted
------ --------
Net sales 3.7 % 3.7 %
Cost of products sold (5.1)% 0.6 %
Gross Profit 23.7 % 8.8 %
Research and development 11.2 % 10.2 %
Acquired in-process research and
development nm nm
Selling, general and administrative 4.6 % 7.7 %
Income From Operations 74.1 % 9.4 %
Interest expense (24.4)% (24.4)%
Other income, net (100.0)% (100.0)%
Income Before Income Taxes 152.1 % 15.9 %
Income tax expense 325.0 % 9.3 %
Net Income 125.1 % 18.3 %
Earnings Per Common Share:
Basic 115.0 % 16.0 %
Diluted 115.0 % 16.3 %
Weighted Average Common Shares Outstanding:
Basic 1.5 % 1.5 %
Diluted 1.3 % 1.3 %
A -- Includes intangible assets amortization of $15.9 related to the Mayne
Pharma acquisition; charges of $9.2 related to the planned closures
of the Ashland, OH; Montreal, Canada; North Chicago, IL; and Morgan
Hill, CA facilities as well as charges to limit, and transfer, R&D
facility operations related to brain-function monitoring devices as
part of Hospira's facilities optimization initiatives; and Mayne
Pharma and other acquisition integration charges of $2.6.
B -- Includes acquisition integration charges of $0.4 and facilities
optimization initiatives of $0.7.
C -- Acquired in-process research and development.
D -- Acquisition integration charges.
E -- Reflects the tax effect of the above adjustments.
F -- Includes inventory step-up charge of $31.7 and intangible assets
amortization of $13.2 related to the Mayne Pharma acquisition;
charges of $14.6 related to the planned closures of the Donegal,
Ireland; Ashland, OH; Montreal, Canada; and North Chicago, IL
facilities as part of Hospira's facilities optimization initiatives;
a reduction of the obligation associated with the sale of the Salt
Lake City, UT manufacturing plant to ICU Medical ($1.6); and Mayne
Pharma integration charges of $4.1.
nm = Percent change is not meaningful.
Hospira, Inc.
Reconciliation of Condensed Consolidated Statements of Income
(Unaudited)
(dollars and shares in millions, except per share amounts)
Six Months Ended June 30,
---------------------------------------------------------
2008 2007
----------------------------- --------------------------
GAAP Adjustments Adjusted GAAP Adjustments Adjusted
-------- ------ ------- ------- ------ -------
Net sales $1,790.3 $ - $1,790.3 $1,652.1 $ - $1,652.1
Cost of
products
sold 1,146.9 (51.2)A 1,095.7 1,111.3 (104.1)F 1,007.2
-------- ------ ------- ------- ------ -------
Gross
Profit 643.4 51.2 694.6 540.8 104.1 644.9
Research and
development 108.4 (1.9)B 106.5 96.1 (0.7)D 95.4
Acquired
in-process
research and
development 0.5 (0.5)C - 84.8 (84.8)C -
Selling,
general and
administrative 305.1 (14.4)D 290.7 277.9 (18.0)D 259.9
-------- ------ ------- ------- ------ -------
Income
From
Operations 229.4 68.0 297.4 82.0 207.6 289.6
Interest
expense 59.6 - 59.6 67.8 (2.3)G 65.5
Other income,
net (4.1) - (4.1) (5.8) (5.7)H (11.5)
-------- ------ ------- ------- ------ -------
Income
Before
Income
Taxes 173.9 68.0 241.9 20.0 215.6 235.6
Income tax
expense 39.4 22.2 E 61.6 18.7 44.9 E 63.6
-------- ------ ------- ------- ------ -------
Net Income $134.5 $45.8 $180.3 $1.3 $170.7 $172.0
======== ====== ======= ======= ====== =======
Earnings Per
Common Share:
Basic $0.85 $0.28 $1.13 $0.01 $1.09 $1.10
======== ====== ======= ======= ====== =======
Diluted $0.83 $0.29 $1.12 $0.01 $1.07 $1.08
======== ====== ======= ======= ====== =======
Weighted Average
Common Shares
Outstanding:
Basic 158.9 158.9 158.9 156.4 156.4 156.4
======== ====== ======= ======= ====== =======
Diluted 161.2 161.2 161.2 159.0 159.0 159.0
======== ====== ======= ======= ====== =======
Statistics
(as a % of
Net Sales,
except for
income tax rate)
-----------------
Gross Profit 35.9% 38.8% 32.7% 39.0%
R&D 6.1% 5.9% 5.8% 5.8%
SG&A 17.0% 16.2% 16.8% 15.7%
Income From
Operations 12.8% 16.6% 5.0% 17.5%
Income Before
Income Taxes 9.7% 13.5% 1.2% 14.3%
Net Income 7.5% 10.1% 0.1% 10.4%
Income Tax Rate 22.7% 25.5% 93.4% 27.0%
% Change vs. Prior Year
-----------------------
GAAP Adjusted
------- --------
Net sales 8.4 % 8.4 %
Cost of products sold 3.2 % 8.8 %
Gross Profit 19.0 % 7.7 %
Research and development 12.8 % 11.6 %
Acquired in-process research and development (99.4)% nm
Selling, general and administrative 9.8 % 11.9 %
Income From Operations 179.8 % 2.7 %
Interest expense (12.1)% (9.0)%
Other income, net (29.3)% (64.3)%
Income Before Income Taxes 769.5 % 2.7 %
Income tax expense 110.7 % (3.2)%
Net Income 10,246.2 % 4.8 %
Earnings Per Common Share:
Basic 8,400.0 % 2.7 %
Diluted 8,200.0 % 3.7 %
Weighted Average Common Shares Outstanding:
Basic 1.6 % 1.6 %
Diluted 1.4 % 1.4 %
A -- Includes intangible assets amortization of $31.6 related to the Mayne
Pharma acquisition; charges of $16.6 related to the planned closures
of the Ashland, OH; Montreal, Canada; North Chicago, IL; and Morgan
Hill, CA facilities as well as charges to limit, and transfer, R&D
facility operations related to brain-function monitoring devices as
part of Hospira's facilities optimization initiatives; and Mayne
Pharma and other acquisition integration charges of $3.0.
B -- Includes acquisition integration charges of $0.8 and facilities
optimization initiatives of $1.1.
C -- Acquired in-process research and development.
D -- Acquisition integration charges.
E -- Reflects the tax effect of the above adjustments.
F -- Includes inventory step-up charge of $53.1 and intangible assets
amortization of $21.6 related to the Mayne Pharma acquisition;
charges of $25.4 related to the planned closures of the Donegal,
Ireland; Ashland, OH; Montreal, Canada; and North Chicago, IL
facilities as part of Hospira's facilities optimization initiatives;
a reduction of the obligation associated with the sale of the Salt
Lake City, UT manufacturing plant to ICU Medical ($1.6); and Mayne
Pharma integration charges of $5.6.
G -- Other acquisition-related cost: bridge loan fees incurred as a result
of the Mayne Pharma acquisition expensed upon refinancing of loan
during the first quarter of 2007.
H -- Other acquisition-related cost: foreign exchange losses related to
the Mayne Pharma acquisition.
nm = Percent change is not meaningful.
Hospira, Inc.
Reconciliation of Diluted Earnings Per Share
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------- --------------------
2008 2007 2008 2007
------ ------ ------ ------
Diluted Earnings Per
Share - GAAP $0.43 $0.20 $0.83 $0.01
Adjustments:
Mayne Pharma acquisition
related:
Acquired in-process
research and
development - - - 0.53
Inventory step-up
charge - 0.14 - 0.23
Integration and
other acquisition-
related charges 0.03 0.05 0.08 0.13
Intangible assets
amortization 0.07 0.05 0.14 0.09
Charges related to
facilities optimization
initiatives 0.04 0.06 0.07 0.10
Reduction of obligation
associated with the
sale of the Salt Lake
City, UT manufacturing
plant - (0.01) - (0.01)
------ ------ ------ ------
Subtotal of Adjustments 0.14 0.29 0.29 1.07
Diluted Earnings Per
Share - Adjusted $0.57 $0.49 $1.12 $1.08
====== ====== ====== ======
Hospira, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(dollars in millions)
June 30, December 31,
Assets 2008 2007
-------- --------
Current Assets:
Cash and cash equivalents $201.4 $241.1
Trade receivables, less allowances of $12.3
in 2008 and $14.1 in 2007 620.1 559.0
Inventories 838.6 766.6
Deferred income taxes 128.3 176.7
Prepaid expenses 30.8 23.8
Other receivables 79.5 73.8
-------- --------
Total Current Assets 1,898.7 1,841.0
-------- --------
Property and equipment, net 1,282.9 1,276.9
Intangible assets, net 558.7 554.0
Goodwill 1,242.4 1,240.9
Deferred income taxes 139.7 79.4
Investments 46.4 23.7
Other assets 61.3 68.8
-------- --------
Total Assets $5,230.1 $5,084.7
======== ========
Liabilities and Shareholders' Equity
Current Liabilities:
Short-term borrowings $330.0 $58.5
Trade accounts payable 202.1 190.3
Salaries, wages and commissions 122.2 143.6
Deferred income taxes 9.8 8.4
Other accrued liabilities 341.1 393.5
-------- --------
Total Current Liabilities 1,005.2 794.3
-------- --------
Long-term debt 1,835.7 2,184.4
Deferred income taxes 30.9 50.7
Post-retirement obligations and other long-
term liabilities 326.4 310.1
Commitments and Contingencies -------- --------
Total Shareholders' Equity 2,031.9 1,745.2
-------- --------
Total Liabilities and Shareholders' Equity $5,230.1 $5,084.7
======== ========
Hospira, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(dollars in millions)
Six Months Ended June 30,
------------------------
2008 2007
-------- --------
Cash Flow From Operating Activities:
Net income $134.5 $1.3
Adjustments to reconcile net income to net
cash from operating activities --
Depreciation 93.9 90.1
Amortization of intangibles 34.4 22.9
Write-off of acquired in-process research
and development 0.5 84.8
Step-up value of acquired inventories sold - 53.1
Stock-based compensation expense 24.5 23.5
Net gains on sales of assets (0.5) -
Changes in assets and liabilities --
Trade receivables (44.5) (55.4)
Inventories (51.2) 4.9
Prepaid expenses and other assets 13.5 (7.3)
Trade accounts payable 9.8 10.3
Other liabilities (41.5) (41.7)
Other, net 9.2 (14.9)
-------- --------
Net Cash Provided by Operating Activities 182.6 171.6
-------- --------
Cash Flow From Investing Activities:
Capital expenditures (including instruments
placed with or leased to customers) (86.7) (88.5)
Acquisitions, net of cash acquired, including
payments for deferred consideration (20.4) (1,961.3)
Purchases of intangibles and other investments (42.3) -
Purchases of marketable securities (24.5) -
Settlements of foreign currency contracts - (55.7)
Proceeds from dispositions of product rights - 13.8
Proceeds from disposal of facilities 0.8 -
-------- --------
Net Cash Used in Investing Activities (173.1) (2,091.7)
-------- --------
Cash Flow From Financing Activities:
Issuance of long-term debt, net of fees paid - 3,336.2
Repayment of long-term debt (85.1) (1,575.1)
Other borrowings, net 7.0 (0.3)
Excess tax benefit from stock-based
compensation arrangements 1.0 0.6
Proceeds from stock options exercised 22.5 27.5
-------- --------
Net Cash (Used in) Provided by Financing
Activities (54.6) 1,788.9
-------- --------
Effect of exchange rate changes on cash and
cash equivalents 5.4 12.2
-------- --------
Net change in cash and cash equivalents (39.7) (119.0)
Cash and cash equivalents at beginning of period 241.1 322.0
-------- --------
Cash and cash equivalents at end of period $201.4 $203.0
======== ========
Supplemental Cash Flow Information:
Cash paid during the period-
Interest $62.4 $45.8
Income taxes, net $27.7 $36.1
Hospira, Inc.
Net Sales by Product Line
(Unaudited)
(dollars in millions)
Three Months Ended June 30,
-------------------------------------------------
% Change at % Change at
Actual Constant
2008 2007 Rates Rates
------ ------ ------- --------
Americas --
Pharmaceuticals
Specialty
Injectables $299.9 $300.5 (0.2)% (1.2)%
Other Pharma 122.7 136.1 (9.8)% (10.4)%
------ ------
422.6 436.6 (3.2)% (4.1)%
Devices
Medication
Management Systems 161.7 132.8 21.8 % 20.4 %
Other Devices 92.9 91.8 1.2 % 0.1 %
------ ------
254.6 224.6 13.4 % 12.1 %
Total Americas 677.2 661.2 2.4 % 1.4 %
Europe, Middle East &
Africa --
Pharmaceuticals
Specialty
Injectables 78.4 70.4 11.4 % 0.2 %
Other Pharma 42.4 40.5 4.7 % (4.5)%
------ ------
120.8 110.9 8.9 % (1.6)%
Devices
Medication
Management Systems 19.3 17.2 12.2 % (2.3)%
Other Devices 16.5 18.6 (11.3)% (22.1)%
------ ------
35.8 35.8 0.0 % (12.6)%
Total Europe, Middle
East & Africa 156.6 146.7 6.7 % (4.3)%
Asia Pacific --
Pharmaceuticals
Specialty
Injectables 52.4 46.5 12.7 % 0.6 %
Other Pharma 3.5 4.5 (22.2)% (32.6)%
------ ------
55.9 51.0 9.6 % (2.3)%
Devices
Medication
Management Systems 5.0 4.0 25.0 % 12.9 %
Other Devices 6.9 6.4 7.8 % (4.3)%
------ ------
11.9 10.4 14.4 % 2.3 %
Total Asia Pacific 67.8 61.4 10.4 % (1.6)%
------ ------
Net Sales $901.6 $869.3 3.7 % 0.2 %
====== ======
Six Months Ended June 30,
---------------------------------------------------
% Change at % Change at
Actual Constant
2008 2007 Rates Rates
------- ------- ------- --------
Americas --
Pharmaceuticals
Specialty
Injectables $640.6 $591.3 8.3 % 7.1 %
Other Pharma 244.6 262.3 (6.7)% (7.5)%
------- -------
885.2 853.6 3.7 % 2.6 %
Devices
Medication
Management Systems 279.8 249.2 12.3 % 10.7 %
Other Devices 186.4 182.9 1.9 % 0.5 %
------- -------
466.2 432.1 7.9 % 6.4 %
Total Americas 1,351.4 1,285.7 5.1 % 3.9 %
Europe, Middle East &
Africa --
Pharmaceuticals
Specialty
Injectables 156.7 119.3 31.3 % 18.4 %
Other Pharma 79.0 73.5 7.5 % (2.7)%
------- -------
235.7 192.8 22.3 % 10.4 %
Devices
Medication
Management Systems 39.7 33.7 17.8 % 3.5 %
Other Devices 34.0 36.2 (6.1)% (17.3)%
------- -------
73.7 69.9 5.4 % (7.3)%
Total Europe, Middle
East & Africa 309.4 262.7 17.8 % 5.7 %
Asia Pacific --
Pharmaceuticals
Specialty
Injectables 98.0 75.9 29.1 % 14.5 %
Other Pharma 7.6 6.6 15.2 % (1.1)%
------- -------
105.6 82.5 28.0 % 13.3 %
Devices
Medication
Management Systems 10.7 8.3 28.9 % 17.5 %
Other Devices 13.2 12.9 2.3 % (9.0)%
------- -------
23.9 21.2 12.7 % 1.4 %
Total Asia Pacific 129.5 103.7 24.9 % 10.9 %
------- -------
Net Sales $1,790.3 $1,652.1 8.4 % 4.7 %
======= =======
Notes:
Specialty Injectable include generic injectables (including
biogenerics) and proprietary specialty injectables (such as Precedex(R)).
Other Pharmaceuticals include large volume IV solutions, nutritionals and
contract manufacturing services (including former "Sales to Abbott").
Medication Management Systems include infusion pumps, related software,
services and administration sets.
Other Devices include gravity administration sets, critical care
products, and other device products.
Net sales for the six months ended June 30, 2008 and 2007, include six
and five months, respectively, of Mayne Pharma net sales.
Hospira, Inc.
Segment Information
(Unaudited)
(dollars in millions)
Three Months Ended June 30,
----------------------------------------------------------
Net Sales Income from Operations
----------------- ------------------
% %
2008 2007 Change 2008 2007 Change
------ ------ ------ ------ ------ ------
Americas $677.2 $661.2 2.4% $140.1 A $111.5 A 25.7 %
Europe,
Middle East
& Africa 156.6 146.7 6.7% 5.7 B 1.8 B 216.7 %
Asia Pacific 67.8 61.4 10.4% (0.3)C (11.0)C 97.3 %
------ ------ ------ ------
Total
reportable
segments $901.6 $869.3 3.7% 145.5 102.3 42.2 %
====== ======
Corporate
functions (17.7)D (18.4)D (3.8)%
Stock-based
compensation (10.1) (16.3) (38.0)%
------ ------
Income from
operations 117.7 67.6 74.1 %
Interest
expense and
other income,
net (28.2)E (32.1)E (12.1)%
------ ------
Income before
income taxes $89.5 $35.5 152.1 %
====== ======
Included in the reported Income before
income taxes above, are the following charges:
A -- Americas
Mayne Pharma acquisition related:
Acquired in-process research and
development $- $-
Inventories step-up charge - 6.0
Integration and other acquisition-
related charges 0.7 7.6
Intangible assets amortization 3.5 2.0
Charges related to facilities
optimization initiatives 9.9 14.6
Integration and other acquisition-
related charges 0.2 -
Acquired in-process research and
development 0.5 -
Reduction of obligation associated with
the sale of the Salt Lake City, UT
manufacturing plant - (1.6)
------ -------
Total Americas 14.8 28.6
B -- Europe, Middle East & Africa
Mayne Pharma acquisition related:
Acquired in-process research and
development - -
Inventories step-up charge - 11.0
Integration and other acquisition-
related charges 4.0 0.8
Intangible assets amortization 2.2 2.2
Charges related to facilities
optimization initiatives - -
------ -------
Total Europe, Middle East & Africa 6.2 14.0
C -- Asia Pacific
Mayne Pharma acquisition related:
Inventories step-up charge - 14.7
Integration and other acquisition-
related charges 2.0 0.8
Intangible assets amortization 10.2 9.0
Integration and other acquisition-
related charges 0.2 -
------ -------
Total Asia Pacific 12.4 24.5
D -- Corporate functions
Integration and other acquisition-
related charges 1.1 4.4
------ -------
Total Corporate functions 1.1 4.4
E -- Interest expense and other
income, net
Integration and other acquisition-
related charges - -
------ -------
Total Interest expense and other
income, net - -
------ -------
Total $34.5 $71.5
====== =======
Hospira, Inc.
Segment Information
(Unaudited)
(dollars in millions)
Six Months Ended June 30,
----------------------------------------------------------
Net Sales Income from Operations
------------------- -------------------
% %
2008 2007 Change 2008 2007 Change
-------- -------- ------ ------ ------ ------
Americas $1,351.4 $1,285.7 5.1% $278.1 A $176.3 A 57.7 %
Europe, Middle
East & Africa 309.4 262.7 17.8% 13.8 B (11.5)B 220.0 %
Asia Pacific 129.5 103.7 24.9% (3.5)C (21.8)C 83.9 %
-------- -------- ------ ------
Total
reportable
segments $1,790.3 $1,652.1 8.4% 288.4 143.0 101.7 %
======== ========
Corporate
functions (34.5)D (37.5)D (8.0)%
Stock-based
compensation (24.5) (23.5) 4.3 %
------ ------
Income from
operations 229.4 82.0 179.8 %
Interest expense
and other income,
net (55.5)E (62.0)E (10.5)%
------ ------
Income before
income taxes $173.9 $20.0 769.5 %
====== ======
Included in the reported Income before
income taxes above, are the following charges:
A -- Americas
Mayne Pharma acquisition related:
Acquired in-process research and
development $- $66.2
Inventories step-up charge - 10.0
Integration and other acquisition-
related charges 1.1 12.1
Intangible assets amortization 7.0 3.3
Charges related to facilities
optimization initiatives 17.7 24.5
Integration and other acquisition-
related charges 0.2 -
Acquired in-process research and
development 0.5 -
Reduction of obligation associated with
the sale of the Salt Lake City, UT
manufacturing plant - (1.6)
------ ------
Total Americas 26.5 114.5
B -- Europe, Middle East & Africa
Mayne Pharma acquisition related:
Acquired in-process research and
development - 18.6
Inventories step-up charge - 18.0
Integration and other acquisition-
related charges 9.4 1.0
Intangible assets amortization 4.4 3.5
Charges related to facilities
optimization initiatives - 0.9
------ ------
Total Europe, Middle East & Africa 13.8 42.0
C -- Asia Pacific
Mayne Pharma acquisition related:
Inventories step-up charge - 25.1
Integration and other acquisition-
related charges 3.4 1.0
Intangible assets amortization 20.2 14.8
Integration and other acquisition-
related charges 0.4 -
------ ------
Total Asia Pacific 24.0 40.9
D -- Corporate functions
Integration and other acquisition-
related charges 3.7 10.3
------ ------
Total Corporate functions 3.7 10.3
E -- Interest expense and other
income, net
Integration and other acquisition-
related charges - 7.9
------ ------
Total Interest expense and other
income, net - 7.9
------ ------
Total $68.0 $215.6
====== ======
SOURCE Hospira, Inc.
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Related links:
http://www.hospira.com
Photo Notes:
NewsCom: http://www.newscom.com/cgi-bin/prnh/20040503/HSPLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com
CONTACT:
Media, Stacey Eisen, +1-224-212-2276, or
Tareta Adams, +1-224-212-2535, or Financial Community, Karen
King, +1-224-212-2711, all of Hospira, Inc.
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