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8-K - FORM 8-K - BAXTER INTERNATIONAL INC | c60838e8vk.htm |
Baxter International Inc. One Baxter Parkway Deerfield, IL 60015 |
FOR IMMEDIATE RELEASE
Media Contact:
Deborah Spak, (847) 948-2349
Deborah Spak, (847) 948-2349
Investor Contacts:
Mary Kay Ladone, (847) 948-3371
Clare Trachtman, (847) 948-3085
Mary Kay Ladone, (847) 948-3371
Clare Trachtman, (847) 948-3085
BAXTER EXCEEDS GUIDANCE IN THIRD QUARTER
WITH EARNINGS OF $1.01 PER DILUTED SHARE
WITH EARNINGS OF $1.01 PER DILUTED SHARE
Company Provides Fourth Quarter and Updated Full-Year 2010 Guidance
DEERFIELD, Ill., October 21, 2010 Baxter International Inc. (NYSE:BAX) today announced its
financial results for the third quarter of 2010, and provided its fourth quarter and updated
full-year 2010 financial outlook.
Baxter reported net income in the third quarter of $595 million, which increased 12 percent
from $530 million reported in the third quarter of 2009. Earnings per diluted share of $1.01
advanced 16 percent and exceeded the companys previously issued earnings guidance of $0.96 to
$0.99 per diluted share. On an adjusted basis, excluding special charges taken in the third
quarter of 2009, Baxters net income declined 1 percent compared to the prior-year period and
earnings per diluted share increased 3 percent.
We are pleased with our financial results in the third quarter which exceeded our guidance,
said Robert J. Hombach, chief financial officer. We effectively executed on our plans to drive
operating margin expansion as a result of continued momentum in the Medication Delivery business,
improvement in the plasma proteins business, and our disciplined focus on expense management.
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BAXTER REPORTS THIRD QUARTER FINANCIAL RESULTS Page 2
Worldwide sales in the third quarter totaled $3.2 billion and increased
3 percent over the same period last year. Excluding the impact of foreign currency, worldwide
sales grew 4 percent. Sales within the United States increased 4 percent to $1.4 billion and
international sales grew 1 percent to
$1.8 billion. Excluding the impact of foreign currency, international sales increased 4 percent.
By business, BioScience revenues totaled $1.4 billion, which was comparable to the prior-year
period. Excluding the impact of foreign currency, BioScience sales increased 3 percent reflecting
enhanced sequential growth across the portfolio. Contributing to the improved performance was
solid growth of ADVATE [Antihemophilic Factor (Recombinant), Plasma/Albumin-Free Method] for the
treatment of hemophilia, strong demand for GAMMAGARD LIQUID [Immune Globulin Intravenous (Human)]
(marketed as KIOVIG outside of the United States) and specialty plasma-based therapeutics such as
FEIBA [Anti-Inhibitor Coagulation Complex] and ARALAST [Alpha1-Proteinase Inhibitor], as
well as biosurgery products.
Medication Delivery sales grew 5 percent to $1.2 billion (or 7 percent excluding the impact of
foreign currency), driven primarily by growth of intravenous therapies (including the companys
parenteral nutrition products), certain multi-source generic drugs, anesthesia products and sales
of the Sigma SPECTRUM infusion pump. Renal sales of $594 million increased 3 percent (and
increased 3 percent excluding the impact of foreign currency), as the company continued to post
solid gains in peritoneal dialysis patients, particularly in the United States, Latin America and
Asia.
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BAXTER REPORTS THIRD QUARTER FINANCIAL RESULTS Page 3
Nine-Month Results
For the first nine months of 2010, Baxter reported net income of $1.1 billion or $1.79 per
diluted share, compared to net income of $1.6 billion or $2.66 per diluted share from the same
period last year. On an adjusted basis, excluding special charges in both years, Baxters net
income for the nine-month period was $1.7 billion and increased 1 percent, and earnings per diluted
share increased
4 percent to $2.87 per diluted share.
Baxters worldwide sales increased 3 percent and totaled $9.3 billion for the first nine
months of 2010, including a first-quarter revenue adjustment of
$213 million associated with the COLLEAGUE infusion pump recall. On an adjusted basis, excluding
the COLLEAGUE charge, Baxters worldwide sales totaled $9.6 billion, an increase of 5 percent over
the prior year revenues of
$9.1 billion. Sales within the United States (excluding the COLLEAGUE adjustment) increased 4
percent to $4.0 billion for the first nine months, and international sales grew 6 percent to $5.5
billion. Excluding the impact of foreign currency, international sales increased 2 percent on a
year-to-date basis.
Through the first nine months of the year, Baxter generated strong cash flow and has returned
significant value to shareholders in the form of dividends and share repurchases. Cash flows from
operations through the first nine months of 2010 totaled $2.1 billion (after a $300 million pension
contribution to the companys U.S. pension fund in the first quarter), reflecting an 8 percent
increase versus the same period last year. In addition, over the last nine months, Baxter has
returned approximately $1.8 billion to shareholders through dividends totaling
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BAXTER REPORTS THIRD QUARTER FINANCIAL RESULTS Page 4
$519 million and share repurchases of approximately $1.3 billion (or 26 million shares).
We continue to benefit from the diversified and medically-necessary nature of our portfolio,
broad geographic reach and strong financial position, despite continued challenges presented by the
evolving global macro-environment, said Robert L. Parkinson, Jr., chairman and chief executive
officer. Over the long term, we remain committed to executing strategies necessary to innovate
through clinical differentiation, enhance earnings growth, and create sustained value for our
shareholders.
Recent Highlights
Baxter continued to enhance its portfolio and advance its pipeline with a number of recent
commercial and pipeline achievements including the following:
| A new five-year contract with Novation, a leading healthcare supply contracting company of VHA Inc., the University HealthSystem Consortium (UHC) and Provista. The agreement provides Novation members access to Baxters broad portfolio of products, including IV solutions, drug delivery and parenteral nutrition products, large volume infusion pumps and IV administration sets and components. | ||
| A manufacturing, supply and distribution agreement with Kamada Limited for GLASSIA, the first and only liquid alpha1-proteinase inhibitor. Under the agreement, Baxter acquired commercial rights to GLASSIA in the United States, Australia, New Zealand and Canada. Under a separate license agreement, Baxter has been granted the right to process GLASSIA and will seek necessary regulatory approvals. | ||
| The U.S. launch of TachoSil [Absorbable Fibrin Sealant Patch] for use as an adjunct to hemostasis in cardiovascular surgery. TachoSil is the first and only ready-to-use adjunctive hemostatic agent available in the United States that combines a collagen patch with a coating of human coagulation factors. Baxter holds exclusive rights to market and distribute TachoSil in the United States. |
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BAXTER REPORTS THIRD QUARTER FINANCIAL RESULTS Page 5
| The approval of PREFLUCEL in Austria and Czech Republic, the first approvals worldwide. PREFLUCEL is a seasonal influenza vaccine manufactured using Baxters proprietary Vero cell technology. Baxter expects to submit for approval in additional European countries during 2010 through a Mutual Recognition Procedure. | ||
| A collaboration between Baxter and Takeda for the development, production and supply of cell culture-based pandemic influenza vaccines for the Japanese market. During the quarter, Takeda was selected as a recipient of a subsidy from the Japanese government to support an investment associated with the development and production of pandemic influenza vaccines. | ||
| The completion of enrollment in a Phase 3 clinical trial of GAMMAGARD LIQUID (marketed as KIOVIG outside of the United States) for the treatment of Multifocal Motor Neuropathy (MMN). The trial includes approximately 40 participants and is being conducted at clinical sites across the United States, Canada and Europe. Upon completion, Baxter intends to seek approval for GAMMAGARD LIQUID (marketed as KIOVIG outside of the United States) for the treatment of MMN and has been granted Orphan Drug Designation for this indication in the United States. | ||
| The presentation of interim data from a Phase 3 clinical trial of HyQ at the European Society for Immunodeficiencies meeting in Istanbul, Turkey. HyQ is an immunoglobulin therapy facilitated subcutaneously by recombinant human hyaluronidase, a dispersion and permeation enhancer. Interim analyses showed that 28 out of 29 HyQ-treated study participants with primary immune deficiency were able to infuse immunoglobulin under the skin, using a single injection site, at infusion volumes, intervals and rates equivalent to their previous IV administration of immunoglobulin. |
Fourth Quarter and Full-Year 2010 Outlook
Baxter also provided financial guidance for the fourth quarter and provided updated guidance
for the full-year 2010. For the fourth quarter of 2010, the company expects sales growth of 1 to 2
percent, excluding the impact of foreign
currency, and earnings of $1.09 to $1.11 per diluted share, before any special items.
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BAXTER REPORTS THIRD QUARTER FINANCIAL RESULTS Page 6
For full-year 2010, Baxters outlook now includes sales growth of 2 to
3 percent, excluding the impact of foreign exchange and the first quarter COLLEAGUE adjustment, and
earnings of $3.96 to $3.98 per diluted share, before any special items. In addition, the company
now expects to generate cash flow from operations of approximately $2.8 billion.
A webcast of Baxters third quarter conference call for investors can be accessed live from a
link on the companys website at www.baxter.com beginning at 7:30 a.m. CDT on October 21, 2010.
Please visit Baxters website for more information regarding this and future investor events and
webcasts.
Baxter International Inc., through its subsidiaries, develops, manufactures and markets
products that save and sustain the lives of people with hemophilia, immune disorders, infectious
diseases, kidney disease, trauma, and other chronic and acute medical conditions. As a global,
diversified healthcare company, Baxter applies a unique combination of expertise in medical
devices, pharmaceuticals and biotechnology to create products that advance patient care worldwide.
This release includes forward-looking statements concerning the companys financial results,
outlook for 2010 and pipeline. The statements are based on assumptions about many important
factors, including the following, which could cause actual results to differ materially from those
in the forward-looking statements: demand for and market acceptance risks for new and existing
products, such as ADVATE, and other technologies; future actions of regulatory
bodies and other governmental authorities, including with respect to the companys implementation
of the COLLEAGUE recall, that could delay, limit or suspend product development, manufacturing or
sales or result in sanctions; product quality or patient safety concerns leading to product
recalls, withdrawals, launch delays, litigation, or declining sales; Sigmas ability to build
production capacity to meet customer demand; future actions of governmental authorities and other
third parties as U.S. healthcare reform legislation is implemented; additional legislation,
regulation and other governmental pressures, which may affect pricing, reimbursement and rebate
policies of government agencies and
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BAXTER REPORTS THIRD QUARTER FINANCIAL RESULTS Page 7
private payers or other elements of the companys business; product development risks;
inventory reductions or fluctuations in buying patterns by wholesalers or distributors; the impact
of geographic and product mix on the companys sales; the impact of competitive products and
pricing, including generic competition, drug reimportation and disruptive technologies; the
availability of acceptable raw materials and component supply; the ability to enforce company
patents; patents of third parties preventing or restricting the companys manufacture, sale or use
of affected products or technology; any impact of the commercial and credit environment on Baxter
and its customers; foreign currency fluctuations and other risks identified in the companys most
recent filing on Form 10-K and other Securities and Exchange Commission filings, all of which are
available on the companys website. The company does not undertake to update its forward-looking
statements. Financial schedules are attached to this release and available on the companys
website.
# # #
BAXTER PAGE 8
BAXTER INTERNATIONAL INC.
Consolidated Statements of Income
Three Months Ended September 30, 2010 and 2009
(unaudited)
(in millions, except per share and percentage data)
Consolidated Statements of Income
Three Months Ended September 30, 2010 and 2009
(unaudited)
(in millions, except per share and percentage data)
Three Months Ended | ||||||||||||
September 30, | ||||||||||||
2010 | 2009 | Change | ||||||||||
NET SALES |
$ | 3,224 | $ | 3,145 | 3% | |||||||
COST OF SALES |
1,565 | 1,513 | A | 3% | ||||||||
GROSS MARGIN |
1,659 | 1,632 | 2% | |||||||||
% of Net Sales |
51.5% | 51.9% | (0.4 pts | ) | ||||||||
MARKETING AND ADMINISTRATIVE EXPENSES |
670 | 672 | 0% | |||||||||
% of Net Sales |
20.8% | 21.4% | (0.6 pts | ) | ||||||||
RESEARCH AND DEVELOPMENT EXPENSES |
207 | 228 | (9% | ) | ||||||||
% of Net Sales |
6.4% | 7.2% | (0.8 pts | ) | ||||||||
NET INTEREST EXPENSE |
24 | 23 | 4% | |||||||||
OTHER EXPENSE, NET |
5 | 51 | B | (90% | ) | |||||||
PRE-TAX INCOME |
753 | 658 | 14% | |||||||||
INCOME TAX EXPENSE |
159 | 126 | 26% | |||||||||
% of Pre-Tax Income |
21.1% | 19.1% | 2.0 pts | |||||||||
NET INCOME |
594 | 532 | 12% | |||||||||
LESS: NONCONTROLLING INTERESTS |
(1 | ) | 2 | N/M | ||||||||
NET INCOME ATTRIBUTABLE TO BAXTER |
$ | 595 | $ | 530 | 12% | |||||||
BASIC EPS |
$ | 1.02 | $ | 0.88 | 16% | |||||||
DILUTED EPS |
$ | 1.01 | $ | 0.87 | 16% | |||||||
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING |
||||||||||||
Basic |
584 | 605 | ||||||||||
Diluted |
587 | 612 | ||||||||||
ADJUSTED PRE-TAX INCOME (excluding specified items) |
$ | 753 | $ | 739 | C | |||||||
ADJUSTED NET INCOME ATTRIBUTABLE TO BAXTER (excluding specified items) |
$ | 595 | $ | 599 | C | |||||||
ADJUSTED DILUTED EPS (excluding specified items) |
$ | 1.01 | $ | 0.98 | C | |||||||
A | Cost of sales in 2009 included a charge of $27 million ($22 million on an after-tax basis, or $0.03 per diluted share) primarily related to planned retirement costs associated with the SYNDEO PCA Syringe Pump. | |
B | Other expense, net in 2009 included an impairment charge of $54 million ($47 million on an after-tax basis, or $0.08 per diluted share) associated with the discontinuation of the companys SOLOMIX drug delivery system in development. | |
C | Refer to page 9 for a description of the adjustments and a reconciliation to GAAP (generally accepted accounting principles) measures. |
BAXTER PAGE 9
BAXTER INTERNATIONAL INC.
Note to Consolidated Statements of Income
Three Months Ended September 30, 2010 and 2009
Description of Adjustments and Reconciliation of GAAP to Non-GAAP Measures
(unaudited)
(in millions, except per share and percentage data)
Note to Consolidated Statements of Income
Three Months Ended September 30, 2010 and 2009
Description of Adjustments and Reconciliation of GAAP to Non-GAAP Measures
(unaudited)
(in millions, except per share and percentage data)
The companys GAAP results for the three months ended September 30, 2009 included specified
items which impacted the GAAP results as follows:
Three Months Ended September 30, | ||||||||||||||||||||
2010 | 2009 | |||||||||||||||||||
Total | Excluding | |||||||||||||||||||
specified | specified | |||||||||||||||||||
GAAP | 1 | GAAP | items | 2 | items | Change | 3 | |||||||||||||
NET SALES |
$ | 3,224 | $ | 3,145 | $ | | $ | 3,145 | 3% | |||||||||||
COST OF SALES |
1,565 | 1,513 | (27 | ) | 1,486 | 5% | ||||||||||||||
GROSS MARGIN |
1,659 | 1,632 | 27 | 1,659 | 0% | |||||||||||||||
% of Net Sales |
51.5% | 51.9% | 52.8% | (1.3 pts | ) | |||||||||||||||
MARKETING AND ADMINISTRATIVE EXPENSES |
670 | 672 | | 672 | 0% | |||||||||||||||
% of Net Sales |
20.8% | 21.4% | 21.4% | (0.6 pts | ) | |||||||||||||||
RESEARCH AND DEVELOPMENT EXPENSES |
207 | 228 | | 228 | (9% | ) | ||||||||||||||
% of Net Sales |
6.4% | 7.2% | 7.2% | (0.8 pts | ) | |||||||||||||||
NET INTEREST EXPENSE |
24 | 23 | | 23 | 4% | |||||||||||||||
OTHER EXPENSE (INCOME), NET |
5 | 51 | (54 | ) | (3 | ) | N/M | |||||||||||||
PRE-TAX INCOME |
753 | 658 | 81 | 739 | 2% | |||||||||||||||
INCOME TAX EXPENSE |
159 | 126 | 12 | 138 | 15% | |||||||||||||||
% of Pre-Tax Income |
21.1% | 19.1% | 18.7% | 2.4 pts | ||||||||||||||||
NET INCOME |
594 | 532 | 69 | 601 | (1% | ) | ||||||||||||||
LESS: NONCONTROLLING INTERESTS |
(1 | ) | 2 | | 2 | N/M | ||||||||||||||
NET INCOME ATTRIBUTABLE TO BAXTER |
$ | 595 | $ | 530 | $ | 69 | $ | 599 | (1% | ) | ||||||||||
BASIC EPS |
$ | 1.02 | $ | 0.88 | $ | 0.11 | $ | 0.99 | 3% | |||||||||||
DILUTED EPS |
$ | 1.01 | $ | 0.87 | $ | 0.11 | $ | 0.98 | 3% | |||||||||||
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | ||||||||||||||||||||
Basic |
584 | 605 | 605 | |||||||||||||||||
Diluted |
587 | 612 | 612 | |||||||||||||||||
1 | There were no specified items included in the 2010 GAAP results. | |
2 | Cost of sales in 2009 included a charge of $27 million ($22 million on an after-tax basis, or $0.03 per diluted share) primarily related to planned retirement costs associated with the SYNDEO PCA Syringe Pump. Other expense (income), net in 2009 included an impairment charge of $54 million ($47 million on an after-tax basis, or $0.08 per diluted share) associated with the discontinuation of the companys SOLOMIX drug delivery system in development. | |
3 | Represents the percentage change between the 2010 GAAP results and the 2009 results excluding specified items. |
For more information on the companys use of non-GAAP financial measures in this press release,
please see the companys Current Report on Form 8-K filed with the Securities and Exchange
Commission on the date of this press release.
BAXTER PAGE 10
BAXTER INTERNATIONAL INC.
Consolidated Statements of Income
Nine Months Ended September 30, 2010 and 2009
(unaudited)
(in millions, except per share and percentage data)
Consolidated Statements of Income
Nine Months Ended September 30, 2010 and 2009
(unaudited)
(in millions, except per share and percentage data)
Nine Months Ended | ||||||||||||
September 30, | ||||||||||||
2010 | 2009 | Change | ||||||||||
NET SALES |
$ | 9,345 | A | $ | 9,092 | 3% | ||||||
COST OF SALES |
5,005 | A | 4,334 | B | 15% | |||||||
GROSS MARGIN |
4,340 | 4,758 | (9% | ) | ||||||||
% of Net Sales |
46.4% | 52.3% | (5.9 pts | ) | ||||||||
MARKETING AND ADMINISTRATIVE EXPENSES |
2,074 | C | 1,943 | 7% | ||||||||
% of Net Sales |
22.2% | 21.4% | 0.8 pts | |||||||||
RESEARCH AND DEVELOPMENT EXPENSES |
653 | 671 | (3% | ) | ||||||||
% of Net Sales |
7.0% | 7.4% | (0.4 pts | ) | ||||||||
NET INTEREST EXPENSE |
68 | 73 | (7% | ) | ||||||||
OTHER EXPENSE, NET |
10 | 52 | D | (81% | ) | |||||||
PRE-TAX INCOME |
1,535 | 2,019 | (24% | ) | ||||||||
INCOME TAX EXPENSE |
464 | E | 380 | 22% | ||||||||
% of Pre-Tax Income |
30.2% | 18.8% | 11.4 pts | |||||||||
NET INCOME |
1,071 | 1,639 | (35% | ) | ||||||||
LESS: NONCONTROLLING INTERESTS |
4 | 6 | (33% | ) | ||||||||
NET INCOME ATTRIBUTABLE TO BAXTER |
$ | 1,067 | $ | 1,633 | (35% | ) | ||||||
BASIC EPS |
$ | 1.80 | $ | 2.68 | (33% | ) | ||||||
DILUTED EPS |
$ | 1.79 | $ | 2.66 | (33% | ) | ||||||
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING |
||||||||||||
Basic |
593 | 608 | ||||||||||
Diluted |
597 | 615 | ||||||||||
ADJUSTED PRE-TAX INCOME (excluding specified items) |
$ | 2,151 | F | $ | 2,100 | F | ||||||
ADJUSTED NET INCOME ATTRIBUTABLE TO BAXTER (excluding specified items) |
$ | 1,716 | F | $ | 1,702 | F | ||||||
ADJUSTED DILUTED EPS (excluding specified items) |
$ | 2.87 | F | $ | 2.77 | F | ||||||
A | A charge was taken in the first quarter of 2010 of $588 million, or $0.98 per diluted share, which related to the recall of COLLEAGUE infusion pumps from the U.S. market and other actions the company intends to undertake outside of the United States, for which there was no net tax benefit recognized. The charge impacted net sales and cost of sales by $213 million and $375 million, respectively. | |
B | Cost of sales in the third quarter of 2009 included a charge of $27 million ($22 million on an after-tax basis, or $0.03 per diluted share) primarily related to planned retirement costs associated with the SYNDEO PCA Syringe Pump. | |
C | Marketing and administrative expenses in the second quarter of 2010 included a charge of $28 million ($22 million, or $0.03 per diluted share, on an after-tax basis) to write down accounts receivable in Greece, principally as a result of the anticipated settlement of certain accounts receivable with the Greek government. | |
D | Other expense, net in the third quarter of 2009 included an impairment charge of $54 million ($47 million on an after-tax basis, or $0.08 per diluted share) associated with the discontinuation of the companys SOLOMIX drug delivery system in development. | |
E | Income tax expense in the first quarter of 2010 included a charge of $39 million, or $0.07 per diluted share, to write off a deferred tax asset as a result of a change in the tax treatment of reimbursements under the Medicare Part D retiree prescription drug subsidy program. | |
F | Refer to page 11 for a description of the adjustments and a reconciliation to GAAP measures. |
BAXTER PAGE 11
BAXTER INTERNATIONAL INC.
Note to Consolidated Statements of Income
Nine Months Ended September 30, 2010 and 2009
Description of Adjustments and Reconciliation of GAAP to Non-GAAP Measures
(unaudited)
(in millions, except per share and percentage data)
Note to Consolidated Statements of Income
Nine Months Ended September 30, 2010 and 2009
Description of Adjustments and Reconciliation of GAAP to Non-GAAP Measures
(unaudited)
(in millions, except per share and percentage data)
The companys GAAP results for the nine months ended September 30, 2010 and 2009 included specified
items which impacted the GAAP results as follows:
Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||
2010 | 2009 | |||||||||||||||||||||||||||||||||||
COLLEAGUE | Greece | Excluding | Total | Excluding | ||||||||||||||||||||||||||||||||
infusion pump | Deferred tax | receivable | specified | specified | specified | |||||||||||||||||||||||||||||||
GAAP | charge | 1 | write-off | 2 | charge | 3 | items | GAAP | items | 4 | items | Change | 5 | |||||||||||||||||||||||
NET SALES |
$ | 9,345 | $ | 213 | $ | | $ | | $ | 9,558 | $ | 9,092 | $ | | $ | 9,092 | 5% | |||||||||||||||||||
COST OF SALES |
5,005 | (375 | ) | | | 4,630 | 4,334 | (27 | ) | 4,307 | 7% | |||||||||||||||||||||||||
GROSS MARGIN |
4,340 | 588 | | | 4,928 | 4,758 | 27 | 4,785 | 3% | |||||||||||||||||||||||||||
% of Net Sales |
46.4% | 51.6% | 52.3% | 52.6% | (1.0 pt | ) | ||||||||||||||||||||||||||||||
MARKETING AND ADMINISTRATIVE EXPENSES |
2,074 | | | (28 | ) | 2,046 | 1,943 | | 1,943 | 5% | ||||||||||||||||||||||||||
% of Net Sales |
22.2% | 21.4% | 21.4% | 21.4% | 0 pts | |||||||||||||||||||||||||||||||
RESEARCH AND DEVELOPMENT EXPENSES |
653 | | | | 653 | 671 | | 671 | (3% | ) | ||||||||||||||||||||||||||
% of Net Sales |
7.0% | 6.8% | 7.4% | 7.4% | (0.6 pts | ) | ||||||||||||||||||||||||||||||
NET INTEREST EXPENSE |
68 | | | | 68 | 73 | | 73 | (7% | ) | ||||||||||||||||||||||||||
OTHER EXPENSE (INCOME), NET |
10 | | | | 10 | 52 | (54 | ) | (2 | ) | N/M | |||||||||||||||||||||||||
PRE-TAX INCOME |
1,535 | 588 | | 28 | 2,151 | 2,019 | 81 | 2,100 | 2% | |||||||||||||||||||||||||||
INCOME TAX EXPENSE |
464 | | (39 | ) | 6 | 431 | 380 | 12 | 392 | 10% | ||||||||||||||||||||||||||
% of Pre-Tax Income |
30.2% | 20.0% | 18.8% | 18.7% | 1.3 pts | |||||||||||||||||||||||||||||||
NET INCOME |
1,071 | 588 | 39 | 22 | 1,720 | 1,639 | 69 | 1,708 | 1% | |||||||||||||||||||||||||||
LESS: NONCONTROLLING INTERESTS |
4 | | | | 4 | 6 | | 6 | (33% | ) | ||||||||||||||||||||||||||
NET INCOME ATTRIBUTABLE TO BAXTER |
$ | 1,067 | $ | 588 | $ | 39 | $ | 22 | $ | 1,716 | $ | 1,633 | $ | 69 | $ | 1,702 | 1% | |||||||||||||||||||
BASIC EPS |
$ | 1.80 | $ | 0.99 | $ | 0.07 | $ | 0.04 | $ | 2.90 | $ | 2.68 | $ | 0.12 | $ | 2.80 | 4% | |||||||||||||||||||
DILUTED EPS |
$ | 1.79 | $ | 0.98 | $ | 0.07 | $ | 0.03 | $ | 2.87 | $ | 2.66 | $ | 0.11 | $ | 2.77 | 4% | |||||||||||||||||||
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING |
||||||||||||||||||||||||||||||||||||
Basic |
593 | 593 | 608 | 608 | ||||||||||||||||||||||||||||||||
Diluted |
597 | 597 | 615 | 615 | ||||||||||||||||||||||||||||||||
1 | A charge was taken in the first quarter of 2010 of $588 million, or $0.98 per diluted share, which related to the recall of COLLEAGUE infusion pumps from the U.S. market and other actions the company intends to undertake outside of the United States, for which there was no net tax benefit recognized. The charge impacted net sales and cost of sales by $213 million and $375 million, respectively. | |
2 | Income tax expense in the first quarter of 2010 included a charge of $39 million, or $0.07 per diluted share, to write off a deferred tax asset as a result of a change in the tax treatment of reimbursements under the Medicare Part D retiree prescription drug subsidy program. | |
3 | Marketing and administrative expenses in the second quarter of 2010 included a charge of $28 million ($22 million, or $0.03 per diluted share, on an after-tax basis) to write down accounts receivable in Greece, principally as a result of the anticipated settlement of certain accounts receivable with the Greek government. | |
4 | Cost of sales in the third quarter of 2009 included a charge of $27 million ($22 million on an after-tax basis, or $0.03 per diluted share) primarily related to planned retirement costs associated with the SYNDEO PCA Syringe Pump. Other expense (income), net in the third quarter of 2009 included an impairment charge of $54 million ($47 million on an after-tax basis, or $0.08 per diluted share) associated with the discontinuation of the companys SOLOMIX drug delivery system in development. | |
5 | Represents the percentage change between the 2010 and 2009 results, both excluding specified items. |
For more information on the companys use of non-GAAP financial measures in this press release,
please see the companys Current Report on Form 8-K filed with the Securities and Exchange
Commission on the date of this press release.
BAXTER PAGE 12
BAXTER INTERNATIONAL INC.
Cash Flows from Operations and Changes in Net Debt
(unaudited)
($ in millions)
Cash Flows from Operations and Changes in Net Debt
(unaudited)
($ in millions)
Cash Flows from Operations |
||||||||||||||||
(Brackets denote cash outflows) | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Net income |
$ | 594 | $ | 532 | $ | 1,071 | $ | 1,639 | ||||||||
Adjustments |
||||||||||||||||
Depreciation and amortization |
171 | 164 | 506 | 466 | ||||||||||||
Deferred income taxes |
91 | 53 | 211 | A | 188 | |||||||||||
Stock compensation |
29 | 32 | 92 | 106 | ||||||||||||
Realized excess tax benefits from stock
issued
under employee benefit plans |
(1 | ) | (7 | ) | (35 | ) | (88 | ) | ||||||||
Infusion pump charges |
| 27 | 588 | 27 | ||||||||||||
Impairment charge |
| 54 | | 54 | ||||||||||||
Greece receivable charge |
| | 28 | | ||||||||||||
Other |
23 | 21 | 28 | 35 | ||||||||||||
Changes in balance sheet items |
||||||||||||||||
Accounts and other current receivables |
11 | (50 | ) | (27 | ) | (108 | ) | |||||||||
Inventories |
25 | (31 | ) | (94 | ) | (116 | ) | |||||||||
Accounts payable and accrued liabilities |
105 | 101 | (57 | ) | (163 | ) | ||||||||||
Restructuring and cost optimization payments |
(12 | ) | (7 | ) | (43 | ) | (35 | ) | ||||||||
Other |
(30 | ) | (14 | ) | (200 | ) B | (82 | ) B | ||||||||
Cash flows from operations |
$ | 1,006 | $ | 875 | $ | 2,068 | $ | 1,923 | ||||||||
Changes in Net Debt | ||||||||||||||||
(Decrease) increase | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Net debt, beginning of period |
$ | 2,514 | $ | 2,030 | $ | 1,365 | $ | 1,625 | ||||||||
Cash flows from operations |
(1,006 | ) | (875 | ) | (2,068 | ) | (1,923 | ) | ||||||||
Capital expenditures |
232 | 247 | 699 | 634 | ||||||||||||
Dividends |
171 | 157 | 519 | 475 | ||||||||||||
Proceeds from stock issued under employee benefit plans |
(33 | ) | (78 | ) | (234 | ) | (201 | ) | ||||||||
Purchases of treasury stock |
161 | 100 | 1,273 | 966 | ||||||||||||
Acquisitions of and investments in businesses and technologies |
20 | C | 54 | 274 | C | 156 | ||||||||||
Other, including the effect of exchange rate changes |
36 | (37 | ) | 267 | (134 | ) | ||||||||||
(Decrease) increase in net debt |
(419 | ) | (432 | ) | 730 | (27 | ) | |||||||||
Net debt, September 30 |
$ | 2,095 | $ | 1,598 | $ | 2,095 | $ | 1,598 | ||||||||
Key statistics, September 30: |
||||||||||||||||
Days sales outstanding |
56.2 | 58.4 | 56.2 | 58.4 | ||||||||||||
Inventory turns |
2.4 | 2.2 | 2.4 | 2.2 | ||||||||||||
Selected balance sheet information: |
September 30, 2010 | December 31, 2009 | ||||||||||||||
Cash and equivalents |
$2,788 | $2,786 | ||||||||||||||
Accounts and other current receivables |
$2,205 | $2,302 | ||||||||||||||
Inventories |
$2,500 | $2,557 | ||||||||||||||
Accounts payable and accrued liabilities |
$3,676 | $3,753 | ||||||||||||||
A | Deferred income taxes in the first quarter of 2010 included a charge of $39 million to write off a deferred tax asset as a result of a change in the tax treatment of reimbursements under the Medicare Part D retiree prescription drug subsidy program. | |
B | Other cash flows from operations in the first quarters of 2010 and 2009 included planned contributions of $300 million and $100 million, respectively, to the companys pension plan in the United States. | |
C | Acquisitions of and investments in businesses and technologies in 2010 principally related to the first quarter acquisition of ApaTech Limited, an orthobiologic products company based in the United Kingdom and the third quarter manufacturing, supply and distribution agreement with Kamada Limited for the exclusive commercial rights to GLASSIATM in the United States and other select markets. |
BAXTER PAGE 13
BAXTER INTERNATIONAL INC.
Net Sales
Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
Net Sales
Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
Q3 | Q3 | % Growth @ | % Growth @ | YTD | YTD | % Growth @ | % Growth @ | |||||||||||||||||||||||||||||
2010 | 2009 | Actual Rates | Constant Rates | 2010 | 2009 | Actual Rates | Constant Rates | |||||||||||||||||||||||||||||
BioScience |
||||||||||||||||||||||||||||||||||||
United States |
$ | 666 | $ | 675 | (1% | ) | (1% | ) | $ | 1,912 | $ | 1,968 | (3% | ) | (3% | ) | ||||||||||||||||||||
International |
721 | 710 | 2% | 7% | 2,195 | 2,087 | 5% | 3% | ||||||||||||||||||||||||||||
Total BioScience |
$ | 1,387 | $ | 1,385 | 0% | 3% | $ | 4,107 | $ | 4,055 | 1% | 0% | ||||||||||||||||||||||||
Medication Delivery |
||||||||||||||||||||||||||||||||||||
United States 1 |
$ | 614 | $ | 550 | 12% | 12% | $ | 1,805 | $ | 1,610 | 12% | 12% | ||||||||||||||||||||||||
International |
616 | 618 | 0% | 2% | 1,846 | 1,727 | 7% | 1% | ||||||||||||||||||||||||||||
Total Medication Delivery - Adjusted 1 |
$ | 1,230 | $ | 1,168 | 5% | 7% | $ | 3,651 | $ | 3,337 | 9% | 7% | ||||||||||||||||||||||||
COLLEAGUE infusion pump charge 1 |
(213 | ) | ||||||||||||||||||||||||||||||||||
Total Medication Delivery - GAAP 1 |
$ | 1,230 | $ | 1,168 | 5% | 7% | $ | 3,438 | $ | 3,337 | 3% | 0% | ||||||||||||||||||||||||
Renal |
||||||||||||||||||||||||||||||||||||
United States |
$ | 99 | $ | 97 | 2% | 2% | $ | 292 | $ | 285 | 2% | 2% | ||||||||||||||||||||||||
International |
495 | 479 | 3% | 4% | 1,471 | 1,356 | 8% | 3% | ||||||||||||||||||||||||||||
Total Renal |
$ | 594 | $ | 576 | 3% | 3% | $ | 1,763 | $ | 1,641 | 7% | 3% | ||||||||||||||||||||||||
Transfusion Therapies 2 |
||||||||||||||||||||||||||||||||||||
United States |
$ | 10 | $ | 10 | 0% | 0% | $ | 28 | $ | 35 | (20% | ) | (20% | ) | ||||||||||||||||||||||
International |
3 | 6 | (50% | ) | (50% | ) | 9 | 24 | (63% | ) | (63% | ) | ||||||||||||||||||||||||
Total Transfusion Therapies |
$ | 13 | $ | 16 | (19% | ) | (19% | ) | $ | 37 | $ | 59 | (37% | ) | (37% | ) | ||||||||||||||||||||
Baxter International Inc. |
||||||||||||||||||||||||||||||||||||
United States 1 |
$ | 1,389 | $ | 1,332 | 4% | 4% | $ | 4,037 | $ | 3,898 | 4% | 4% | ||||||||||||||||||||||||
International |
1,835 | 1,813 | 1% | 4% | 5,521 | 5,194 | 6% | 2% | ||||||||||||||||||||||||||||
Total Baxter - Adjusted 1 |
$ | 3,224 | $ | 3,145 | 3% | 4% | $ | 9,558 | $ | 9,092 | 5% | 3% | ||||||||||||||||||||||||
COLLEAGUE infusion pump charge 1 |
(213 | ) | ||||||||||||||||||||||||||||||||||
Total Baxter - GAAP 1 |
$ | 3,224 | $ | 3,145 | 3% | 4% | $ | 9,345 | $ | 9,092 | 3% | 1% | ||||||||||||||||||||||||
1 | GAAP net sales in the first quarter of 2010 included a charge of $213 million related to the recall of COLLEAGUE infusion pumps from the U.S. market. Refer to page 17 for a reconciliation to GAAP measures. | |
2 | Represents revenues associated with manufacturing, distribution and other services provided by the company to the buyer of the Transfusion Therapies (TT) business after the February 2007 divestiture. |
BAXTER PAGE 14
BAXTER INTERNATIONAL INC.
GAAP Key Product Line Sales
Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
GAAP Key Product Line Sales
Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
GAAP | GAAP | % Growth @ | % Growth @ | GAAP | GAAP | % Growth @ | % Growth @ | |||||||||||||||||||||||||||||
Q3 2010 | Q3 2009 | Actual Rates | Constant Rates | YTD 2010 | YTD 2009 | Actual Rates | Constant Rates | |||||||||||||||||||||||||||||
BioScience |
||||||||||||||||||||||||||||||||||||
Recombinants |
$ | 526 | $ | 528 | 0% | 2% | $ | 1,561 | $ | 1,494 | 4% | 3% | ||||||||||||||||||||||||
Plasma Proteins |
346 | 331 | 5% | 8% | 952 | 958 | (1% | ) | (2% | ) | ||||||||||||||||||||||||||
Antibody Therapy |
336 | 336 | 0% | 2% | 968 | 1,017 | (5% | ) | (5% | ) | ||||||||||||||||||||||||||
Regenerative Medicine |
130 | 109 | 19% | 22% | 382 | 317 | 21% | 19% | ||||||||||||||||||||||||||||
Other 1 |
49 | 81 | (40% | ) | (33% | ) | 244 | 269 | (9% | ) | (11% | ) | ||||||||||||||||||||||||
Total BioScience |
$ | 1,387 | $ | 1,385 | 0% | 3% | $ | 4,107 | $ | 4,055 | 1% | 0% | ||||||||||||||||||||||||
Medication Delivery |
||||||||||||||||||||||||||||||||||||
IV Therapies |
$ | 417 | $ | 396 | 5% | 7% | $ | 1,226 | $ | 1,124 | 9% | 6% | ||||||||||||||||||||||||
Global Injectables |
469 | 433 | 8% | 9% | 1,392 | 1,222 | 14% | 11% | ||||||||||||||||||||||||||||
Infusion Systems 2 |
213 | 208 | 2% | 2% | 425 | 612 | (31% | ) | (34% | ) | ||||||||||||||||||||||||||
Anesthesia |
127 | 123 | 3% | 5% | 384 | 352 | 9% | 7% | ||||||||||||||||||||||||||||
Other |
4 | 8 | (50% | ) | (38% | ) | 11 | 27 | (59% | ) | (48% | ) | ||||||||||||||||||||||||
Total Medication Delivery 2 |
$ | 1,230 | $ | 1,168 | 5% | 7% | $ | 3,438 | $ | 3,337 | 3% | 0% | ||||||||||||||||||||||||
Renal |
||||||||||||||||||||||||||||||||||||
PD Therapy |
$ | 487 | $ | 473 | 3% | 3% | $ | 1,441 | $ | 1,347 | 7% | 3% | ||||||||||||||||||||||||
HD Therapy |
107 | 103 | 4% | 5% | 322 | 294 | 10% | 5% | ||||||||||||||||||||||||||||
Total Renal |
$ | 594 | $ | 576 | 3% | 3% | $ | 1,763 | $ | 1,641 | 7% | 3% | ||||||||||||||||||||||||
Transfusion Therapies 3 |
$ | 13 | $ | 16 | (19% | ) | (19% | ) | $ | 37 | $ | 59 | (37% | ) | (37% | ) | ||||||||||||||||||||
Total Baxter 2 |
$ | 3,224 | $ | 3,145 | 3% | 4% | $ | 9,345 | $ | 9,092 | 3% | 1% | ||||||||||||||||||||||||
1 | Principally includes vaccines and sales of plasma to third parties. | |
2 | GAAP net sales in the first quarter of 2010 included a charge of $213 million related to the recall of COLLEAGUE infusion pumps from the U.S. market. Refer to page 17 for a reconciliation to GAAP measures. | |
3 | Represents revenues associated with manufacturing, distribution and other services provided by the company to the buyer of the TT business after the February 2007 divestiture. |
BAXTER
PAGE 15
BAXTER INTERNATIONAL INC.
Adjusted Key Product Line Sales
Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
Adjusted Key Product Line Sales
Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
GAAP | GAAP | % Growth @ | % Growth @ | Adjusted | GAAP | % Growth @ | % Growth @ | |||||||||||||||||||||||||||||
Q3 2010 | Q3 2009 | Actual Rates | Constant Rates | YTD 2010 | YTD 2009 | Actual Rates | Constant Rates | |||||||||||||||||||||||||||||
BioScience |
||||||||||||||||||||||||||||||||||||
Recombinants |
$ | 526 | $ | 528 | 0% | 2% | $ | 1,561 | $ | 1,494 | 4% | 3% | ||||||||||||||||||||||||
Plasma Proteins |
346 | 331 | 5% | 8% | 952 | 958 | (1% | ) | (2% | ) | ||||||||||||||||||||||||||
Antibody Therapy |
336 | 336 | 0% | 2% | 968 | 1,017 | (5% | ) | (5% | ) | ||||||||||||||||||||||||||
Regenerative Medicine |
130 | 109 | 19% | 22% | 382 | 317 | 21% | 19% | ||||||||||||||||||||||||||||
Other 1 |
49 | 81 | (40% | ) | (33% | ) | 244 | 269 | (9% | ) | (11% | ) | ||||||||||||||||||||||||
Total BioScience |
$ | 1,387 | $ | 1,385 | 0% | 3% | $ | 4,107 | $ | 4,055 | 1% | 0% | ||||||||||||||||||||||||
Medication Delivery |
||||||||||||||||||||||||||||||||||||
IV Therapies |
$ | 417 | $ | 396 | 5% | 7% | $ | 1,226 | $ | 1,124 | 9% | 6% | ||||||||||||||||||||||||
Global Injectables |
469 | 433 | 8% | 9% | 1,392 | 1,222 | 14% | 11% | ||||||||||||||||||||||||||||
Infusion
Systems - Adjusted 2 |
213 | 208 | 2% | 2% | 638 | 612 | 4% | 1% | ||||||||||||||||||||||||||||
Anesthesia |
127 | 123 | 3% | 5% | 384 | 352 | 9% | 7% | ||||||||||||||||||||||||||||
Other |
4 | 8 | (50% | ) | (38% | ) | 11 | 27 | (59% | ) | (48% | ) | ||||||||||||||||||||||||
Total
Medication Delivery - Adjusted 2 |
$ | 1,230 | $ | 1,168 | 5% | 7% | $ | 3,651 | $ | 3,337 | 9% | 7% | ||||||||||||||||||||||||
Renal |
||||||||||||||||||||||||||||||||||||
PD Therapy |
$ | 487 | $ | 473 | 3% | 3% | $ | 1,441 | $ | 1,347 | 7% | 3% | ||||||||||||||||||||||||
HD Therapy |
107 | 103 | 4% | 5% | 322 | 294 | 10% | 5% | ||||||||||||||||||||||||||||
Total Renal |
$ | 594 | $ | 576 | 3% | 3% | $ | 1,763 | $ | 1,641 | 7% | 3% | ||||||||||||||||||||||||
Transfusion Therapies 3 |
$ | 13 | $ | 16 | (19% | ) | (19% | ) | $ | 37 | $ | 59 | (37% | ) | (37% | ) | ||||||||||||||||||||
Total
Baxter - Adjusted 2 |
$ | 3,224 | $ | 3,145 | 3% | 4% | $ | 9,558 | $ | 9,092 | 5% | 3% | ||||||||||||||||||||||||
1 | Principally includes vaccines and sales of plasma to third parties. | |
2 | Adjusted net sales in the first quarter of 2010 excluded a charge of $213 million related to the recall of COLLEAGUE infusion pumps from the U.S. market. Refer to page 17 for a reconciliation to GAAP measures. | |
3 | Represents revenues associated with manufacturing, distribution and other services provided by the company to the buyer of the TT business after the February 2007 divestiture. |
BAXTER
PAGE 16
BAXTER INTERNATIONAL INC.
Key Product Line Sales by U.S. and International
Three-Month Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
Key Product Line Sales by U.S. and International
Three-Month Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
Q3 2010 | Q3 2009 | % Growth | |||||||||||||||||||||||||||||||||||||||
U.S. | International | Total | U.S. | International | Total | U.S. | International | Total | |||||||||||||||||||||||||||||||||
BioScience |
|||||||||||||||||||||||||||||||||||||||||
Recombinants |
$ | 237 | $ | 289 | $ | 526 | $ | 237 | $ | 291 | $ | 528 | 0% | (1% | ) | 0% | |||||||||||||||||||||||||
Plasma Proteins |
113 | 233 | 346 | 126 | 205 | 331 | (10% | ) | 14% | 5% | |||||||||||||||||||||||||||||||
Antibody Therapy |
230 | 106 | 336 | 239 | 97 | 336 | (4% | ) | 9% | 0% | |||||||||||||||||||||||||||||||
Regenerative Medicine |
79 | 51 | 130 | 62 | 47 | 109 | 27% | 9% | 19% | ||||||||||||||||||||||||||||||||
Other 1 |
7 | 42 | 49 | 11 | 70 | 81 | (36% | ) | (40% | ) | (40% | ) | |||||||||||||||||||||||||||||
Total BioScience |
$ | 666 | $ | 721 | $ | 1,387 | $ | 675 | $ | 710 | $ | 1,385 | (1% | ) | 2% | 0% | |||||||||||||||||||||||||
Medication Delivery |
|||||||||||||||||||||||||||||||||||||||||
IV Therapies |
$ | 144 | $ | 273 | $ | 417 | $ | 122 | $ | 274 | $ | 396 | 18% | 0% | 5% | ||||||||||||||||||||||||||
Global Injectables |
257 | 212 | 469 | 228 | 205 | 433 | 13% | 3% | 8% | ||||||||||||||||||||||||||||||||
Infusion Systems |
127 | 86 | 213 | 118 | 90 | 208 | 8% | (4% | ) | 2% | |||||||||||||||||||||||||||||||
Anesthesia |
84 | 43 | 127 | 81 | 42 | 123 | 4% | 2% | 3% | ||||||||||||||||||||||||||||||||
Other |
2 | 2 | 4 | 1 | 7 | 8 | 100% | (71% | ) | (50% | ) | ||||||||||||||||||||||||||||||
Total Medication Delivery |
$ | 614 | $ | 616 | $ | 1,230 | $ | 550 | $ | 618 | $ | 1,168 | 12% | 0% | 5% | ||||||||||||||||||||||||||
Renal |
|||||||||||||||||||||||||||||||||||||||||
PD Therapy |
$ | 80 | $ | 407 | $ | 487 | $ | 76 | $ | 397 | $ | 473 | 5% | 3% | 3% | ||||||||||||||||||||||||||
HD Therapy |
19 | 88 | 107 | 21 | 82 | 103 | (10% | ) | 7% | 4% | |||||||||||||||||||||||||||||||
Total Renal |
$ | 99 | $ | 495 | $ | 594 | $ | 97 | $ | 479 | $ | 576 | 2% | 3% | 3% | ||||||||||||||||||||||||||
Transfusion Therapies 2 |
$ | 10 | $ | 3 | $ | 13 | $ | 10 | $ | 6 | $ | 16 | 0% | (50% | ) | (19% | ) | ||||||||||||||||||||||||
Total Baxter |
$ | 1,389 | $ | 1,835 | $ | 3,224 | $ | 1,332 | $ | 1,813 | $ | 3,145 | 4% | 1% | 3% | ||||||||||||||||||||||||||
1 | Principally includes vaccines and sales of plasma to third parties. | |
2 | Represents revenues associated with manufacturing, distribution and other services provided by the company to the buyer of the TT business after the February 2007 divestiture. |
BAXTER PAGE 17
BAXTER INTERNATIONAL INC.
Reconciliation of GAAP to Non-GAAP Net Sales Measures
Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
Reconciliation of GAAP to Non-GAAP Net Sales Measures
Periods Ending September 30, 2010 and 2009
(unaudited)
($ in millions)
The companys GAAP net sales results for the nine months ended September 30, 2010 included a
$213 million charge related to the recall of COLLEAGUE infusion pumps from the U.S. market, which
impacted GAAP net sales as follows:
% Growth @ | % Growth @ | |||||||||||||||||||||||||||||||||||||||||||||||||||||
2010 YTD | 2009 YTD | Actual Rates | Constant Rates | |||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. | International | Total | U.S. | International | Total | U.S. | International | Total | U.S. | International | Total | |||||||||||||||||||||||||||||||||||||||||||
Infusion
Systems - GAAP |
$ | 425 | $ | 612 | (31% | ) | (34% | ) | ||||||||||||||||||||||||||||||||||||||||||||||
COLLEAGUE infusion pump charge |
213 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Infusion
Systems - Adjusted |
$ | 638 | $ | 612 | 4% | 1% | ||||||||||||||||||||||||||||||||||||||||||||||||
Total
Medication Delivery - GAAP |
$ | 1,592 | $1,846 | $ | 3,438 | $ | 1,610 | $1,727 | $ | 3,337 | (1% | ) | 7% | 3% | (1% | ) | 1% | 0% | ||||||||||||||||||||||||||||||||||||
COLLEAGUE infusion pump charge |
213 | 213 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Total
Medication Delivery - Adjusted |
$ | 1,805 | $1,846 | $ | 3,651 | $ | 1,610 | $1,727 | $ | 3,337 | 12% | 7% | 9% | 12% | 1% | 7% | ||||||||||||||||||||||||||||||||||||||
Total
Baxter - GAAP |
$ | 3,824 | $5,521 | $ | 9,345 | $ | 3,898 | $5,194 | $ | 9,092 | (2% | ) | 6% | 3% | (2% | ) | 2% | 1% | ||||||||||||||||||||||||||||||||||||
COLLEAGUE infusion pump charge |
213 | 213 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Total
Baxter - Adjusted |
$ | 4,037 | $5,521 | $ | 9,558 | $ | 3,898 | $5,194 | $ | 9,092 | 4% | 6% | 5% | 4% | 2% | 3% | ||||||||||||||||||||||||||||||||||||||
For more information on the companys use of non-GAAP financial measures in this press release,
please see the companys Current Report on Form 8-K filed with the Securities and Exchange
Commission on the date of this press release.