Consolidated Statement of Earni
Consolidated Statement of Earnings (USD $) | |||
In Thousands, except Per Share data | 12 Months Ended
Dec. 31, 2009 | 12 Months Ended
Dec. 31, 2008 | 12 Months Ended
Dec. 31, 2007 |
Consolidated Statement of Earnings | |||
Net Sales | $30,764,707 | $29,527,552 | $25,914,238 |
Cost of products sold | 13,209,329 | 12,612,022 | 11,422,046 |
Research and development | 2,743,733 | 2,688,811 | 2,505,649 |
Acquired in-process research and development | 170,000 | 97,256 | |
Selling, general and administrative | 8,405,904 | 8,435,624 | 7,407,998 |
Total Operating Cost and Expenses | 24,528,966 | 23,833,713 | 21,335,693 |
Operating Earnings | 6,235,741 | 5,693,839 | 4,578,545 |
Interest expense | 519,656 | 528,474 | 593,142 |
Interest (income) | (137,779) | (201,229) | (136,752) |
(Income) from the TAP Pharmaceutical Products Inc. joint venture | (118,997) | (498,016) | |
Net foreign exchange (gain) loss | 35,584 | 84,244 | 14,997 |
Other (income) expense, net | (1,375,494) | (454,939) | 135,526 |
Earnings from Continuing Operations Before Taxes | 7,193,774 | 5,856,286 | 4,469,648 |
Taxes on Earnings from Continuing Operations | 1,447,936 | 1,122,070 | 863,334 |
Earnings from Continuing Operations | 5,745,838 | 4,734,216 | 3,606,314 |
Gain on Sale of Discontinued Operations, net of taxes | 146,503 | ||
Net Earnings | $5,745,838 | $4,880,719 | $3,606,314 |
Basic Earnings Per Common Share -- | |||
Continuing Operations (in dollars per share) | 3.71 | 3.06 | 2.34 |
Gain on Sale of Discontinued Operations, net of taxes (in dollars per share) | 0.1 | ||
Net Earnings (in dollars per share) | 3.71 | 3.16 | 2.34 |
Diluted Earnings Per Common Share -- | |||
Continuing Operations (in dollars per share) | 3.69 | 3.03 | 2.31 |
Gain on Sale of Discontinued Operations, net of taxes (in dollars per share) | 0.09 | ||
Net Earnings (in dollars per share) | 3.69 | 3.12 | 2.31 |
Average Number of Common Shares Outstanding Used for Basic Earnings Per Common Share (in shares) | 1,546,983 | 1,545,355 | 1,543,082 |
Dilutive Common Stock Options and Awards (in shares) | 8,143 | 15,398 | 16,975 |
Average Number of Common Shares Outstanding Plus Dilutive Common Stock Options and Awards (in shares) | 1,555,126 | 1,560,753 | 1,560,057 |
Outstanding Common Stock Options Having No Dilutive Effect (in shares) | 66,189 | 30,579 | 6,406 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows (USD $) | |||
In Thousands | 12 Months Ended
Dec. 31, 2009 | 12 Months Ended
Dec. 31, 2008 | 12 Months Ended
Dec. 31, 2007 |
Cash Flow From (Used in) Operating Activities of Continuing Operations: | |||
Net earnings | $5,745,838 | $4,880,719 | $3,606,314 |
Less: Gain on sale of discontinued operations | 146,503 | ||
Earnings from continuing operations | 5,745,838 | 4,734,216 | 3,606,314 |
Adjustments to reconcile earnings from continuing operations to net cash from operating activities of continuing operations - | |||
Depreciation | 1,210,977 | 1,051,728 | 1,072,855 |
Amortization of intangible assets | 878,533 | 787,101 | 782,031 |
Derecognition of a contingent liability associated with the conclusion of the TAP Pharmaceutical Products Inc. joint venture | (797,130) | ||
Share-based compensation | 366,357 | 347,015 | 429,677 |
Gain on dissolution of the TAP Pharmaceutical Products Inc. joint venture | (94,248) | ||
Acquired in-process research and development | 170,000 | 97,256 | |
Investing and financing (gains) losses, net | 41,967 | 111,238 | 356,331 |
Trade receivables | (387,749) | (948,314) | (431,846) |
Inventories | 230,555 | (257,476) | 131,324 |
Prepaid expenses and other assets | (386,889) | 436,218 | (418,344) |
Trade accounts payable and other liabilities | (374,715) | 569,056 | (82,960) |
Income taxes | 577,416 | 160,830 | (261,539) |
Net Cash From Operating Activities of Continuing Operations | 7,275,160 | 6,994,620 | 5,183,843 |
Cash Flow From (Used in) Investing Activities of Continuing Operations: | |||
Acquisitions of businesses and technologies, net of cash acquired | (2,370,630) | (250,000) | |
Acquisitions of property and equipment | (1,089,048) | (1,287,724) | (1,656,207) |
Sales of Boston Scientific common stock | 318,645 | 568,437 | |
Purchases of investment securities | (248,970) | (923,937) | (32,852) |
Proceeds from sales of investment securities | 16,306 | 130,586 | 17,830 |
Other | (6,368) | (75,061) | (33,485) |
Net Cash (Used in) Investing Activities of Continuing Operations | (3,698,710) | (2,087,491) | (1,136,277) |
Cash Flow From (Used in) Financing Activities of Continuing Operations: | |||
Proceeds from issuance of (repayments of) short-term debt and other | 3,217,331 | (324,739) | (3,603,481) |
Proceeds from issuance of long-term debt | 3,000,000 | 3,500,000 | |
Repayments of long-term debt | (2,483,176) | (913,948) | (441,012) |
Purchases of common shares | (826,345) | (1,081,806) | (1,058,793) |
Proceeds from stock options exercised, including income tax benefit | 508,669 | 1,008,843 | 1,249,804 |
Dividends paid | (2,414,460) | (2,174,252) | (1,959,150) |
Net Cash From (Used in) Financing Activities of Continuing Operations | 1,002,019 | (3,485,902) | (2,312,632) |
Effect of exchange rate changes on cash and cash equivalents | 118,848 | (115,160) | 200,258 |
Net cash provided from the sale of discontinued operations | 349,571 | ||
Net Increase in Cash and Cash Equivalents | 4,697,317 | 1,655,638 | 1,935,192 |
Cash and Cash Equivalents, Beginning of Year | 4,112,022 | 2,456,384 | 521,192 |
Cash and Cash Equivalents, End of Year | $8,809,339 | $4,112,022 | $2,456,384 |
Consolidated Balance Sheet
Consolidated Balance Sheet (USD $) | |||
In Thousands | Dec. 31, 2009
| Dec. 31, 2008
| Dec. 31, 2007
|
Current Assets: | |||
Cash and cash equivalents | $8,809,339 | $4,112,022 | $2,456,384 |
Investments, including $307,500 of investments measured at fair value at December 31, 2007 | 1,122,709 | 967,603 | 364,443 |
Trade receivables, less allowances of - 2009: $311,546; 2008: $263,632; 2007: $258,288 | 6,541,941 | 5,465,660 | 4,946,876 |
Inventories: | |||
Finished products | 2,289,280 | 1,545,950 | 1,677,083 |
Work in process | 448,487 | 698,140 | 681,634 |
Materials | 527,110 | 531,759 | 592,725 |
Total inventories | 3,264,877 | 2,775,849 | 2,951,442 |
Deferred income taxes | 2,364,142 | 2,462,871 | 2,109,872 |
Other prepaid expenses and receivables | 1,210,883 | 1,258,554 | 1,213,716 |
Total Current Assets | 23,313,891 | 17,042,559 | 14,042,733 |
Investments | 1,132,866 | 1,073,736 | 1,125,262 |
Property and Equipment, at Cost: | |||
Land | 546,204 | 509,606 | 494,021 |
Buildings | 4,010,439 | 3,698,861 | 3,589,050 |
Equipment | 11,325,450 | 10,366,267 | 10,393,402 |
Construction in progress | 604,813 | 613,939 | 1,121,328 |
Property and Equipment, at Cost, gross | 16,486,906 | 15,188,673 | 15,597,801 |
Less: accumulated depreciation and amortization | 8,867,417 | 7,969,507 | 8,079,652 |
Net Property and Equipment | 7,619,489 | 7,219,166 | 7,518,149 |
Intangible Assets, net of amortization | 6,291,989 | 5,151,106 | 5,720,478 |
Goodwill | 13,200,174 | 9,987,361 | 10,128,841 |
Deferred Income Taxes and Other Assets | 858,214 | 1,945,276 | 1,178,461 |
Total Assets | 52,416,623 | 42,419,204 | 39,713,924 |
Current Liabilities: | |||
Short-term borrowings | 4,978,438 | 1,691,069 | 1,827,361 |
Trade accounts payable | 1,280,542 | 1,351,436 | 1,219,529 |
Salaries, wages and commissions | 1,117,410 | 1,011,312 | 859,784 |
Other accrued liabilities | 4,363,032 | 4,216,742 | 3,713,104 |
Dividends payable | 620,640 | 559,064 | 504,540 |
Income taxes payable | 442,140 | 805,397 | 80,406 |
Obligation in connection with conclusion of the TAP Pharmaceutical Products Inc. joint venture | 36,105 | 915,982 | |
Current portion of long-term debt | 211,182 | 1,040,906 | 898,554 |
Total Current Liabilities | 13,049,489 | 11,591,908 | 9,103,278 |
Long-term Debt | 11,266,294 | 8,713,327 | 9,487,789 |
Post-employment Obligations and Other Long-term Liabilities | 5,202,111 | 4,595,278 | 3,298,912 |
Shareholders' Investment: | |||
Preferred shares, one dollar par value Authorized - 1,000,000 shares, none issued | 0 | 0 | 0 |
Common shares, without par value Authorized - 2,400,000,000 shares Issued at stated capital amount - Shares: 2009: 1,612,683,987; 2008: 1,601,580,899; 2007: 1,580,854,677 | 8,257,873 | 7,444,411 | 6,104,102 |
Common shares held in treasury, at cost - Shares: 2009: 61,516,398; 2008: 49,147,968; 2007: 30,944,537 | (3,310,347) | (2,626,404) | (1,213,134) |
Earnings employed in the business | 17,054,027 | 13,825,383 | 10,805,809 |
Accumulated other comprehensive income (loss) | 854,074 | (1,163,839) | 2,081,763 |
Total Abbott Shareholders' Investment | 22,855,627 | 17,479,551 | 17,778,540 |
Noncontrolling Interests in Subsidiaries | 43,102 | 39,140 | 45,405 |
Total Shareholders' Investment | 22,898,729 | 17,518,691 | 17,823,945 |
Total Liabilities and Shareholders' Investment | $52,416,623 | $42,419,204 | $39,713,924 |
Consolidated Balance Sheet (Par
Consolidated Balance Sheet (Parenthetical) (USD $) | |||
In Thousands, except Share data | Dec. 31, 2009
| Dec. 31, 2008
| Dec. 31, 2007
|
Consolidated Balance Sheet | |||
Investments measured at fair value (in dollars) | $307,500 | ||
Trade receivables, allowances (in dollars) | $311,546 | $263,632 | $258,288 |
Preferred shares, par value (in dollars per share) | $1 | $1 | $1 |
Preferred shares, Authorized shares | 1,000,000 | 1,000,000 | 1,000,000 |
Preferred shares, Issued shares | 0 | 0 | 0 |
Common shares, Authorized shares | 2,400,000,000 | 2,400,000,000 | 2,400,000,000 |
Common shares, Issued shares | 1,612,683,987 | 1,601,580,899 | 1,580,854,677 |
Common shares held in treasury | 61,516,398 | 49,147,968 | 30,944,537 |
Consolidated Statement of Share
Consolidated Statement of Shareholders' Investment (USD $) | |||
In Thousands | 12 Months Ended
Dec. 31, 2009 | 12 Months Ended
Dec. 31, 2008 | 12 Months Ended
Dec. 31, 2007 |
Beginning of Year | $17,518,691 | $17,823,945 | $14,054,186 |
Net earnings | 5,745,838 | 4,880,719 | 3,606,314 |
End of Year | 22,898,729 | 17,518,691 | 17,823,945 |
Common Stock | |||
Beginning of Year | 7,444,411 | 6,104,102 | 4,290,929 |
Issued under incentive stock programs | 530,373 | 1,001,507 | 1,316,294 |
Tax benefit from option shares and vesting of restricted stock awards (no share effect) | 15,351 | 64,714 | 163,808 |
Share-based compensation | 366,128 | 342,315 | 433,319 |
Issuance of restricted stock awards | (98,390) | (68,227) | (100,248) |
End of Year | 8,257,873 | 7,444,411 | 6,104,102 |
Common Stock Held in Treasury | |||
Beginning of Year | (2,626,404) | (1,213,134) | (195,237) |
Private transaction in 2008 | (378,931) | ||
Issued under incentive stock programs | 133,042 | 40,946 | 37,080 |
Purchased | (816,985) | (1,075,285) | (1,054,977) |
End of Year | (3,310,347) | (2,626,404) | (1,213,134) |
Earnings Employed in the Business | |||
Beginning of Year | 13,825,383 | 10,805,809 | 9,568,728 |
Net earnings | 5,745,838 | 4,880,719 | 3,606,314 |
Cash dividends declared on common shares | (2,476,036) | (2,228,776) | (2,009,696) |
Reclassification resulting from the application of the fair value option to Boston Scientific common stock, net of tax | (188,534) | ||
Cost of common shares retired in excess of stated capital amount | (25,040) | (70,590) | (237,958) |
Cost of treasury shares issued (above) below market value | (16,118) | 438,221 | 66,955 |
End of Year | 17,054,027 | 13,825,383 | 10,805,809 |
Accumulated Other Comprehensive Income (Loss) | |||
Beginning of Year | (1,163,839) | 2,081,763 | 389,766 |
Reclassification resulting from the application of the fair value option to Boston Scientific common stock, net of tax | 181,834 | ||
Other comprehensive income (loss) | 2,017,913 | (3,245,602) | 1,510,163 |
End of Year | 854,074 | (1,163,839) | 2,081,763 |
Noncontrolling Interests in Subsidiaries | |||
Beginning of Year | 39,140 | 45,405 | 43,945 |
Noncontrolling Interests' share of income, net of distributions and share repurchases | 3,962 | (6,265) | 1,460 |
End of Year | 43,102 | 39,140 | 45,405 |
Comprehensive Income | |||
Comprehensive Income | $7,763,751 | $1,635,117 | $5,116,477 |
1_Consolidated Statement of Sha
Consolidated Statement of Shareholders' Investment (Parenthetical) (USD $) | ||||
12 Months Ended
Dec. 31, 2009 | 12 Months Ended
Dec. 31, 2008 | 12 Months Ended
Dec. 31, 2007 | Dec. 31, 2006
| |
Common Stock | ||||
Increase (Decrease) in Shareholders' Investment | ||||
Beginning of Year, Shares | 1,601,580,899 | 1,580,854,677 | 1,550,590,438 | |
Issued under incentive stock programs, shares | 11,103,088 | 20,726,222 | 30,264,239 | |
End of Year, Shares | 1,612,683,987 | 1,601,580,899 | 1,580,854,677 | 1,550,590,438 |
Common Stock Held in Treasury | ||||
Increase (Decrease) in Shareholders' Investment | ||||
Beginning of Year, Shares | 49,147,968 | 30,944,537 | 13,347,272 | |
Private transaction in 2008: Shares purchased | 15,176,500 | |||
Private transaction in 2008, shares issued | 14,870,195 | |||
Issued under incentive stock programs, shares | 2,477,853 | 1,607,326 | 2,063,123 | |
Purchased: treasury shares | 14,846,283 | 19,504,452 | 19,660,388 | |
End of Year, Shares | 61,516,398 | 49,147,968 | 30,944,537 | 13,347,272 |
Earnings Employed in the Business | ||||
Increase (Decrease) in Shareholders' Investment | ||||
Cash dividends declared on common shares, per share (in dollars per share) | 1.6 | 1.44 | 1.3 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Summary of Significant Accounting Policies | Note1 Summary of Significant Accounting Policies NATURE OF BUSINESS Abbott's principal business is the discovery, development, manufacture and sale of a broad line of health care products. CONCENTRATION OF RISK AND GUARANTEES Due to the nature of its operations, Abbott is not subject to significant concentration risks relating to customers, products or geographic locations, except that three U.S. wholesalers accounted for 23percent, 27percent and 25percent of trade receivables as of December31, 2009, 2008 and 2007, respectively. Product warranties are not significant. Abbott has no material exposures to off-balance sheet arrangements; no special purpose entities; nor activities that include non-exchange-traded contracts accounted for at fair value. Abbott has periodically entered into agreements in the ordinary course of business, such as assignment of product rights, with other companies which has resulted in Abbott becoming secondarily liable for obligations that Abbott was previously primarily liable. Since Abbott no longer maintains a business relationship with the other parties, Abbott is unable to develop an estimate of the maximum potential amount of future payments, if any, under these obligations. Based upon past experience, the likelihood of payments under these agreements is remote. Abbott periodically acquires a business or product rights in which Abbott agrees to pay contingent consideration based on attaining certain thresholds or based on the occurrence of certain events. In connection with the spin-off of Hospira, Inc., Abbott has retained liabilities for taxes on income prior to the spin-off and certain potential liabilities, if any, related to alleged improper pricing practices in connection with federal, state and private reimbursement for certain drugs. BASIS OF CONSOLIDATION The consolidated financial statements include the accounts of the parent company and subsidiaries, after elimination of intercompany transactions. The accounts of foreign subsidiaries are consolidated as of November30, due to the time needed to consolidate these subsidiaries. In December 2009, a foreign subsidiary acquired certain technology that was accounted for as acquired in-process research and development. This transaction was recorded in 2009 due to the significance of the amount. No other events occurred related to these foreign subsidiaries in December 2009, 2008 and 2007 that materially affected the financial position, results of operations or cash flows. Events that occurred after December31, 2009 through the date that these financial statements have been filed with the Securities and Exchange Commission were considered in the preparation of these financial statements. Effective January1, 2009, Abbott adopted SFAS No.160, "Noncontrolling Interests in Consolidated Financial Statements an amendment of ARB No.51," as codified in FASB ASC No.810, "Consolidation" and accordingly, noncontrolling interests in subsidiaries are presented as a component of total equity as of December31, 2009, 2008 and 2007. USE OF ESTIMATES The financial statements have been prepared in accordance with generally accepted accounting principles i |
Supplemental Financial Informat
Supplemental Financial Information | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Supplemental Financial Information | Note2 Supplemental Financial Information 2009 2008 2007 (dollars in millions) Current Investments: Time deposits and certificates of deposit $ 1,123 $ 968 $ 56 Boston Scientific common stock 308 Total $ 1,123 $ 968 $ 364 2009 2008 2007 (dollars in millions) Long-term Investments: Equity securities $ 153 $ 147 $ 229 Note receivable from Boston Scientific, 4% interest, due in 2011 880 865 851 Other 100 62 45 Total $ 1,133 $ 1,074 $ 1,125 The fair value option for the investment in Boston Scientific common stock was applied effective January1, 2007. Under the fair value option, any cumulative unrealized gains or losses on an equity investment previously accounted for as an available-for-sale security is recorded as a cumulative effect adjustment to retained earnings as of the date of the election to apply the fair value option. The pretax and after tax adjustment to Earnings employed in the business upon election to apply the fair value option was $297million and $189million, respectively, and the fair value and carrying amount of the investment before and after the election was approximately $1.0billion. The pretax and after tax adjustment to Accumulated other comprehensive income (loss) was $303million and $182million, respectively. The effect on deferred income taxes of applying the fair value option was not significant. Other (income) expense, net, for 2009 includes the derecognition of a contingent liability of $797million associated with the conclusion of the TAP Pharmaceutical Products Inc. joint venture as discussed in Note3, a $287million gain from the settlement reached between Abbott and Medtronic, Inc. resolving all outstanding intellectual property litigation between the two parties and income from the recording of certain investments at fair value in connection with business acquisitions. Other (income) expense, net, for 2009 and 2008 also includes ongoing contractual payments from Takeda associated with the conclusion of the TAP joint venture and a gain in 2008 on the sale of an equity investment accounted for as an available-for-sale investment. In addition, Abbott recorded a gain of approximately $94million in connection with the dissolution of the TAP joint venture in 2008. Other (income) expense, net for 2007 includes a $190million fair market value loss adjustment to Abbott's investment in Boston Scientific common stock and a realized gain of $37million on the sales of Boston Scientific common stock. 2009 2008 2007 (dollars in millions) Other Accrued Liabilities: Accrued rebates payable to government agencies $ 641 $ 577 $ 662 Accrued other rebates(a) 668 455 444 All other 3,054 3,185 2,607 Total $ 4,363 $ 4,217 $ 3,713 (a) Accrued wholesaler chargeback rebates of $217, $210 and $157 at December31, 2009, 2008 and 2007, respectively, are n |
Conclusion of TAP Pharmaceutica
Conclusion of TAP Pharmaceutical Products Inc. Joint Venture and Sale of Abbott's Spine Business | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Conclusion of TAP Pharmaceutical Products Inc. Joint Venture and Sale of Abbott's Spine Business | Note3 Conclusion of TAP Pharmaceutical Products Inc. Joint Venture and Sale of Abbott's Spine Business On April30, 2008, Abbott and Takeda concluded their TAP Pharmaceutical Products Inc. (TAP) joint venture, evenly splitting the value and assets of the joint venture. Abbott exchanged its 50percent equity interest in TAP for the assets, liabilities and employees related to TAP's Lupron business. Subsequent to the conclusion of the joint venture, TAP was merged into two Takeda entities. The exchange of Abbott's investment in TAP for TAP's Lupron business resulted in a gain at closing of approximately $94million. The Internal Revenue Service has issued a private letter ruling that the transaction qualifies as tax-free for U.S. income tax purposes. Beginning on May1, 2008, Abbott began recording U.S. Lupron net sales and costs in its operating results and no longer records income from the TAP joint venture. TAP's sales of Lupron were $182million for the four months ended April30, 2008 and $645million in 2007. Abbott also receives payments based on specified development, approval and commercial events being achieved with respect to products retained by Takeda and payments from Takeda based on sales of products retained by Takeda, which are recorded by Abbott as Other (income) expense, net as earned. The exchange transaction was accounted for as a sale of Abbott's equity interest in TAP and as an acquisition of TAP's Lupron business. The sale of Abbott's equity interest in TAP resulted in the recording of net assets related to the Lupron business, primarily cash, receivables, inventory and other assets, net of accounts payable and other accrued liabilities, offset by a credit to Abbott's investment in TAP in the amount of approximately $280million. For the acquired Lupron business, Abbott recorded intangible assets, primarily Lupron product rights, of approximately $700million, goodwill of approximately $350million and deferred tax liabilities related primarily to the intangible assets of approximately $260million. The intangible assets are being amortized over 15years. Abbott has also agreed to remit cash to Takeda if certain research and development events are not achieved on the development assets retained by Takeda. These amounts were recorded as a liability at closing in the amount of approximately $1.1billion. Related deferred tax assets of approximately $410million were also recorded. Of the $1.1billion, Abbott made tax-deductible payments of $83million and $200million in 2009 and 2008, respectively, and Abbott will make a tax-deductible payment of approximately $36million in 2010. In 2009, events occurred resulting in the remaining payments not being required and the remaining liability in the amount of $797million was derecognized and recorded as income in Other (income) expense, net. The 50percent-owned joint venture was accounted for under the equity method of accounting. Summarized financial information for TAP follows below. The results for 2008 include results through April30. (dollars in millions) Year Ended December31 2008 2007 Net sales $ 853 $ 3,002 Cost of sales 2 |
Financial Instruments, Derivati
Financial Instruments, Derivatives and Fair Value Measures | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Financial Instruments, Derivatives and Fair Value Measures | Note4 Financial Instruments, Derivatives and Fair Value Measures Certain Abbott foreign subsidiaries enter into foreign currency forward exchange contracts to manage exposures to changes in foreign exchange rates for anticipated intercompany purchases by those subsidiaries whose functional currencies are not the U.S. dollar. These contracts, totaling $2.0billion, $129million and $281million at December31, 2009, 2008 and 2007, respectively, are designated as cash flow hedges of the variability of the cash flows due to changes in foreign exchange rates and are recorded at fair value. Accumulated gains and losses as of December31, 2009 will be included in Cost of products sold at the time the products are sold, generally through the next twelve months. Abbott enters into foreign currency forward exchange contracts to manage currency exposures for foreign currency denominated third-party trade payables and receivables, and for intercompany loans and trade accounts payable where the receivable or payable is denominated in a currency other than the functional currency of the entity. For intercompany loans, the contracts require Abbott to sell or buy foreign currencies, primarily European currencies and Japanese yen, in exchange for primarily U.S. dollars and other European currencies. For intercompany and trade payables and receivables, the currency exposures are primarily the U.S. dollar, European currencies and Japanese yen. At December31, 2009, 2008 and 2007, Abbott held $7.5billion, $8.3billion and $5.5billion, respectively, of such foreign currency forward exchange contracts. Abbott has designated foreign denominated short-term debt as a hedge of the net investment in certain foreign subsidiaries of approximately $575million, $585million and $1.7billion as of December31, 2009, 2008 and 2007, respectively. Accordingly, changes in the fair value of this debt due to changes in exchange rates are recorded in Accumulated other comprehensive income (loss), net of tax. Abbott is a party to interest rate hedge contracts totaling $5.5billion, $2.5billion and $1.5billion at December31, 2009, 2008 and 2007, respectively, to manage its exposure to changes in the fair value of fixed-rate debt due 2011 through 2019. These contracts are designated as fair value hedges of the variability of the fair value of fixed-rate debt due to changes in the long-term benchmark interest rates. The effect of the hedge is to change a fixed-rate interest obligation to a variable rate for that portion of the debt. Abbott records the contracts at fair value and adjusts the carrying amount of the fixed-rate debt by an offsetting amount. No hedge ineffectiveness was recorded in income in 2009, 2008 and 2007 for these hedges. Gross unrealized holding gains (losses) on available-for-sale equity securities totaled $42million and $(3)million, respectively, at December31, 2009; $55million and $(23)million, respectively, at December31, 2008 and $108million and $(3)million, respectively, at December31, 2007. The following table summarizes the amounts and location of certain derivative financial instruments as of December31: |
Post-Employment Benefits
Post-Employment Benefits | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Post-Employment Benefits | Note5 Post-Employment Benefits Retirement plans consist of defined benefit, defined contribution and medical and dental plans. Information for Abbott's major defined benefit plans and post-employment medical and dental benefit plans is as follows: (dollars in millions) Defined Benefit Plans Medical and Dental Plans 2009 2008 2007 2009 2008 2007 Projected benefit obligations, January1 $ 5,541 $ 5,783 $ 5,614 $ 1,443 $ 1,514 $ 1,520 Service cost benefits earned during the year 221 233 249 45 43 58 Interest cost on projected benefit obligations 368 353 316 94 92 97 Losses (gains), primarily changes in discount rates, plan design changes, law changes and differences between actual and estimated health care costs 747 (278 ) (309 ) 175 (158 ) (100 ) Benefits paid (251 ) (241 ) (228 ) (58 ) (68 ) (61 ) Other, primarily foreign currency translation 226 (309 ) 141 6 20 Projected benefit obligations, December31 $ 6,852 $ 5,541 $ 5,783 $ 1,705 $ 1,443 $ 1,514 Plans' assets at fair value, January1 $ 3,997 $ 5,667 $ 5,086 $ 266 $ 307 $ 212 Actual return on plans' assets 1,096 (1,568 ) 442 62 (106 ) 20 Company contributions 862 285 283 71 133 136 Benefits paid (251 ) (241 ) (228 ) (58 ) (68 ) (61 ) Other, primarily foreign currency translation 108 (146 ) 84 Plans' assets at fair value, December31 $ 5,812 $ 3,997 $ 5,667 $ 341 $ 266 $ 307 Projected benefit obligations greater than plans' assets, December31 $ (1,040 ) $ (1,544 ) $ (116 ) $ (1,364 ) $ (1,177 ) $ (1,207 ) Long-term assets $ 21 $ 16 $ 576 $ $ $ Short-term liabilities (31 ) (24 ) (27 ) Long-term liabilities (1,030 ) (1,536 ) (665 ) (1,364 ) (1,177 ) (1,207 ) Net liability $ (1,040 ) $ (1,544 ) $ (116 ) $ (1,364 ) $ (1,177 ) $ (1,207 ) Amounts Recognized in Accumulated Other Comprehensive Income (loss): Actuarial losses, net $ 2,699 $ 2,554 $ 920 $ 685 $ 587 $ 635 Prior service cost (credits) 34 38 40 (184 ) (206 ) (227 ) Total $ 2,733 $ 2,592 $ 960 $ 501 $ 381 $ 408 The projected benefit obligations for non-U.S. defined benefit plans was $2.0billion, $1.3billion and $1.8billion at December31, 2009, 2008 and 2007, respectively. The accumulated benefit obligations for all defined benefit plans was $5.8billion, $4.7billion and $4.9billion at December31, 2009, 2008 and 2007, respectively. For plans where the accumulated benefit obligations exceeded plan assets at December31, 2009, 2008 and 2007, the aggregate accum |
Taxes on Earnings
Taxes on Earnings | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Taxes on Earnings | Note6 Taxes on Earnings Taxes on earnings from continuing operations reflect the annual effective rates, including charges for interest and penalties. Deferred income taxes reflect the tax consequences on future years of differences between the tax bases of assets and liabilities and their financial reporting amounts. U.S. income taxes are provided on those earnings of foreign subsidiaries which are intended to be remitted to the parent company. Abbott does not record deferred income taxes on earnings reinvested indefinitely in foreign subsidiaries. Undistributed earnings reinvested indefinitely in foreign subsidiaries as working capital and plant and equipment aggregated $20.6billion at December31, 2009. It is not practicable to determine the amount of deferred income taxes not provided on these earnings. In the U.S., Abbott's federal income tax returns through 2005 are settled, and the income tax returns for years after 2005 are open. There are numerous other income tax jurisdictions for which tax returns are not yet settled, none of which are individually significant. Reserves for interest and penalties are not significant. Earnings from continuing operations before taxes, and the related provisions for taxes on earnings from continuing operations, were as follows: (dollars in millions) 2009 2008 2007 Earnings From Continuing Operations Before Taxes: Domestic $ 1,502 $ (81 ) $ 670 Foreign 5,692 5,937 3,800 Total $ 7,194 $ 5,856 $ 4,470 2009 2008 2007 Taxes on Earnings From Continuing Operations: Current: U.S. Federal, State and Possessions $ 194 $ 1,188 $ 564 Foreign 521 782 675 Total current 715 1,970 1,239 Deferred: Domestic 905 (845 ) (304 ) Foreign (172 ) (3 ) (72 ) Total deferred 733 (848 ) (376 ) Total $ 1,448 $ 1,122 $ 863 Differences between the effective income tax rate and the U.S. statutory tax rate were as follows: 2009 2008 2007 Statutory tax rate on earnings from continuing operations 35.0 % 35.0 % 35.0 % Benefit of lower foreign tax rates and tax exemptions (16.4 ) (16.7 ) (12.6 ) State taxes, net of federal benefit 1.0 0.2 0.4 Adjustments primarily related to resolution of prior years' accrual requirements (0.5 ) Domestic dividend exclusion (0.6 ) (3.1 ) All other, net 0.5 1.8 (0.4 ) Effective tax rate on earnings from continuing operations 20.1 % 19.2 % 19.3 % As of December31, 2009, 2008 and 2007, total deferred tax assets were $4.4billion, $5.4billion and $3.6billion, respectively, and total deferred tax liabilities were $1.8billion, $1.4billion and $1.4billion, respectively. Abbott has incurred losses in a foreign jurisdiction where realization of the future economic benefit is so remote that the benefit |
Segment and Geographic Area Inf
Segment and Geographic Area Information | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Segment and Geographic Area Information | Note7 Segment and Geographic Area Information Abbott's principal business is the discovery, development, manufacture and sale of a broad line of health care products. Abbott's products are generally sold directly to retailers, wholesalers, hospitals, health care facilities, laboratories, physicians' offices and government agencies throughout the world. Abbott's reportable segments are as follows: Pharmaceutical Products Worldwide sales of a broad line of pharmaceuticals. For segment reporting purposes, two pharmaceutical divisions are aggregated and reported as the Pharmaceutical Products segment. Nutritional Products Worldwide sales of a broad line of adult and pediatric nutritional products. Diagnostic Products Worldwide sales of diagnostic systems and tests for blood banks, hospitals, commercial laboratories and alternate-care testing sites. For segment reporting purposes, three diagnostic divisions are aggregated and reported as the Diagnostic Products segment. Vascular Products Worldwide sales of coronary, endovascular and vessel closure products. Abbott's underlying accounting records are maintained on a legal entity basis for government and public reporting requirements. Segment disclosures are on a performance basis consistent with internal management reporting. Intersegment transfers of inventory are recorded at standard cost and are not a measure of segment operating earnings. The cost of some corporate functions and the cost of certain employee benefits are charged to segments at predetermined rates that approximate cost. Remaining costs, if any, are not allocated to segments. For acquisitions prior to 2006, substantially all intangible assets and related amortization are not allocated to segments. The following segment information has been prepared in accordance with the internal accounting policies of Abbott, as described above, and are not presented in accordance with generally accepted accounting principles applied to the consolidated financial statements. (dollars in millions) Net Sales to External Customers(a) Operating Earnings (Loss)(a) Depreciation and Amortization Additions to Long-term Assets Total Assets 2009 2008 2007 2009 2008 2007 2009 2008 2007 2009 2008 2007 2009 2008 2007 Pharmaceuticals(b) $ 16,486 $ 16,708 $ 14,632 $ 6,443 $ 6,331 $ 5,509 $ 384 $ 323 $ 330 $ 239 $ 831 $ 407 $ 11,215 $ 10,356 $ 9,197 Nutritionals 5,284 4,924 4,388 910 859 855 157 135 115 173 281 388 3,368 3,220 3,261 Diagnostics 3,578 3,575 3,158 406 375 252 282 312 286 453 270 374 3,688 3,218 3,792 Vascular(b) 2,692 2,241 1,663 557 205 (188 ) 238 240 234 611 489 312 5,403 4,822 4,706 Total Reportable Segments 28,040 27,448 23,841 $ 8,316 $ 7,770 $ 6,428 $ 1,061 $ 1,010 $ 965 $ 1,476 $ |
Litigation and Environmental Ma
Litigation and Environmental Matters | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Litigation and Environmental Matters | Note8 Litigation and Environmental Matters Abbott has been identified as a potentially responsible party for investigation and cleanup costs at a number of locations in the United States and Puerto Rico under federal and state remediation laws and is investigating potential contamination at a number of company-owned locations. Abbott has recorded an estimated cleanup cost for each site for which management believes Abbott has a probable loss exposure. No individual site cleanup exposure is expected to exceed $3million, and the aggregate cleanup exposure is not expected to exceed $15million. There are a number of patent disputes with third parties who claim Abbott's products infringe their patents. In April 2007, New York University (NYU) and Centocor, Inc. filed a lawsuit in the Eastern District of Texas asserting that HUMIRA infringes a patent co-owned by NYU and Centocor and exclusively licensed to Centocor. In June 2009, a jury found that Abbott had willfully infringed the patent and awarded NYU and Centocor approximately $1.67billion in past compensatory damages. In October 2009, the district court overturned the jury's finding that Abbott's infringement was willful, but denied Abbott's request to overturn the jury's verdict on validity, infringement, and damages. In December 2009, the district court issued a final judgment and awarded the plaintiffs an additional $175million in prejudgment interest. Abbott has appealed the jury's verdict. Abbott is confident in the merits of its case and believes that it will prevail on appeal. As a result, no reserves have been recorded in this case. Abbott's acquisition of Kos Pharmaceuticals Inc. resulted in the assumption of various cases and investigations and Abbott has recorded a reserve. There are several civil actions pending brought by individuals or entities that allege generally that Abbott and numerous pharmaceutical companies reported false or misleading pricing information relating to the average wholesale price of certain pharmaceutical products in connection with federal, state and private reimbursement. Civil actions have also been brought against Abbott, and in some cases other members of the pharmaceutical industry, by state attorneys general seeking to recover alleged damages on behalf of state Medicaid programs. In May 2006, Abbott was notified that the U.S. Department of Justice intervened in a civil whistle-blower lawsuit alleging that Abbott inflated prices for Medicaid and Medicare reimbursable drugs. Abbott has settled a few of the cases and recorded reserves for its estimated losses in a few other cases, however, Abbott is unable to estimate the range or amount of possible loss for the remaining cases, and no loss reserves have been recorded for them. Many of the products involved in these cases are Hospira products. Hospira, Abbott's former hospital products business, was spun off to Abbott's shareholders in 2004. Abbott retained liability for losses that result from these cases and investigations to the extent any such losses both relate to the sale of Hospira's products prior to the spin-off of Hospira and relate to allegations that were made in such pending and |
Incentive Stock Program
Incentive Stock Program | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Incentive Stock Program | Note9 Incentive Stock Program The 2009 Incentive Stock Program authorizes the granting of nonqualified stock options, replacement stock options, restricted stock awards, restricted stock units, performance awards, foreign benefits and other share-based awards. Stock options, replacement stock options and restricted stock awards and units comprise the majority of benefits that have been granted and are currently outstanding under this program and a prior program. In 2009, Abbott granted 1,783,300 stock options, 1,449,301 replacement stock options, 1,278,467 restricted stock awards and 5,677,322 restricted stock units under this program. In addition, 2,899,411 options were issued in connection with the conversion of Advanced Medical Optics, Inc. options to Abbott options. The purchase price of shares under option must be at least equal to the fair market value of the common stock on the date of grant, and the maximum term of an option is 10years. Options vest equally over three years except for replacement options, which vest in six months. Options granted before January1, 2005 included a replacement feature. Except for options outstanding that have a replacement feature, options granted after December31, 2004 do not include a replacement feature. When an employee tenders mature shares to Abbott upon exercise of a stock option, a replacement stock option may be granted equal to the amount of shares tendered. Replacement options are granted at the then current market price for a term that expires on the date of the underlying option grant. Upon a change in control of Abbott, all outstanding stock options become fully exercisable, and all terms and conditions of all restricted stock awards and units are deemed satisfied. Restricted stock awards generally vest between 3 and 5years and for restricted stock awards that vest over 5years, no more than one-third of the award vests in any one year upon Abbott reaching a minimum return on equity target. Restricted stock units vest over three years and upon vesting, the recipient receives one share of Abbott stock for each vested restricted stock unit. The aggregate fair market value of restricted stock awards and units is recognized as expense over the service period. Restricted stock awards and settlement of vested restricted stock units are issued out of treasury shares. Abbott generally issues new shares for exercises of stock options. Abbott does not have a policy of purchasing its shares relating to its share-based programs. At December31, 2009, approximately 220million shares were reserved for future grants, including 175million shares authorized by Abbott's shareholders in April 2009. Subsequent to year-end, the reserve was reduced by approximately 23million shares for stock options and restricted stock awards and units granted by the Board of Directors. The number of restricted stock awards and units outstanding and the weighted-average grant-date fair value at December31, 2008 and December31, 2009 was 3,574,445 and $52.21 and 8,703,247 and $53.64, respectively. The number of restricted stock awards and units, and the weighted-average grant-date fair value, that were granted, vested and |
Debt and Lines of Credit
Debt and Lines of Credit | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Debt and Lines of Credit | Note10 Debt and Lines of Credit The following is a summary of long-term debt at December31: (dollars in millions) 2009 2008 2007 Various notes, due 2009 $ $ $ 1,000 1.51% Yen notes, due 2010 157 135 3.75% Notes, due 2011 500 500 500 5.6% Notes, due 2011 1,500 1,500 1,500 5.15% Notes, due 2012 1,000 1,000 1,000 4.35% Notes, due 2014 500 500 500 5.875% Notes, due 2016 2,000 2,000 2,000 5.6% Notes, due 2017 1,500 1,500 1,500 5.125% Notes, due 2019 2,000 6.15% Notes, due 2037 1,000 1,000 1,000 6.0% Notes, due 2039 1,000 Other, including fair value adjustments relating to interest rate hedge contracts designated as fair value hedges 266 556 353 Total, net of current maturities 11,266 8,713 9,488 Current maturities of long-term debt 211 1,041 898 Total carrying amount $ 11,477 $ 9,754 $ 10,386 Principal payments required on long-term debt outstanding at December31, 2009, are $211million in 2010, $2.0billion in 2011, $1.0billion in 2012, $291million in 2013, $502million in 2014 and $7.6billion thereafter. At December31, 2009, Abbott's long-term debt rating was AA by Standard Poor's Corporation and A1 by Moody's Investors Service. Abbott has readily available financial resources, including unused lines of credit of $6.3billion that support commercial paper borrowing arrangements of which a $3.3billion facility expires in October 2010 and a $3.0billion facility expires in 2012. Related compensating balances, which are subject to withdrawal by Abbott at its option, and commitment fees are not material. Abbott's weighted-average interest rate on short-term borrowings was 0.2% at December31, 2009, 0.5% at December31, 2008 and 3.7% at December31, 2007. |
Business Combinations, Technolo
Business Combinations, Technology Acquisitions and Related Transactions | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Business Combinations, Technology Acquisitions and Related Transactions | Note11 Business Combinations, Technology Acquisitions and Related Transactions On January1, 2009, Abbott adopted the provisions of SFAS No.141 (revised 2007), "Business Combinations," as codified in FASB ASC No.805, "Business Combinations." Under ASC No.805, acquired in-process research and development is accounted for as an indefinite-lived intangible asset until approval or discontinuation rather than as expense, acquisition costs in connection with an acquisition are expensed rather than added to the cost of an acquisition and the fair value of contingent consideration at the date of an acquisition is added to the cost of the acquisition. In February 2009, Abbott acquired the outstanding shares of Advanced Medical Optics, Inc. (AMO) for approximately $1.4billion in cash, net of cash held by AMO. Prior to the acquisition, Abbott held a small investment in AMO. Abbott acquired AMO to take advantage of increasing demand for vision care technologies due to population growth and demographic shifts and AMO's premier position in its field. Abbott acquired control of this business on February25, 2009 and the financial results of the acquired operations are included in these financial statements beginning on that date. The acquisition was financed with long-term debt. The allocation of the fair value of the acquisition is shown in the table below: (dollars in billions) Goodwill, non-deductible $ 1.7 Acquired intangible assets, non-deductible 0.9 Acquired in-process research and development, non-deductible 0.2 Acquired net tangible assets 0.4 Acquired debt (1.5 ) Deferred income taxes recorded at acquisition (0.3 ) Total allocation of fair value $ 1.4 Acquired intangible assets consist of established customer relationships, developed technology and trade names and will be amortized over 2 to 30years (average of 15years). Acquired in-process research and development will be accounted for as an indefinite-lived intangible asset until regulatory approval or discontinuation. The net tangible assets acquired consist primarily of trade accounts receivable, inventory, property and equipment and other assets, net of assumed liabilities, primarily trade accounts payable, accrued compensation and other liabilities. Abbott incurred approximately $89million of acquisition-related expenses in 2009 which are classified as Selling, general and administrative expense. In addition, subsequent to the acquisition, Abbott repaid substantially all of the acquired debt of AMO. In October 2009, Abbott acquired 100percent of Visiogen, Inc. for $400million, in cash, providing Abbott with a next-generation accommodating intraocular lens (IOL) technology to address presbyopia for cataract patients. The preliminary allocation of the fair value of the acquisition resulted in non-deductible acquired in-process research and development of approximately $195million which will be accounted for as an indefinite-lived intangible asset until regulatory approval or discontinuation, non-deductible definite-lived intangible assets of approximately $33million, goodwill of approximately $260million |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Goodwill and Intangible Assets | Note12 Goodwill and Intangible Assets Abbott recorded goodwill of approximately $2.2billion in 2009 related to the acquisitions of Advanced Medical Optics, Inc., Ibis Biosciences, Inc., Visiogen, Inc. and Evalve, Inc. Goodwill of approximately $120million related to the Ibis acquisition was allocated to the Diagnostic Products segment and goodwill of approximately $160million related to the Evalve acquisition was allocated to the Vascular Products segment. In connection with the dissolution of the TAP Pharmaceutical Products Inc. (TAP) joint venture in 2008, Abbott recorded approximately $350million of goodwill related to the Pharmaceutical Products segment. In 2008, Abbott paid $250million to Boston Scientific as a result of the FDA's approval to market the XienceV drug-eluting stent in the U.S., resulting in an increase in goodwill in the Vascular Products segment. Abbott recorded goodwill of $53million in 2007 related to acquisitions. Goodwill adjustments recorded in 2007 allocated to the Pharmaceutical Products segment amounted to $194million and adjustments allocated to the Vascular Products segment amounted to $(141)million. Foreign currency translation and other adjustments increased (decreased) goodwill in 2009, 2008 and 2007 by $997million, $(677)million and $627million, respectively. The amount of goodwill related to reportable segments at December31, 2009 was $6.7billion for the Pharmaceutical Products segment, $206million for the Nutritional Products segment, $385million for the Diagnostic Products segment, and $2.7billion for the Vascular Products segment. Goodwill was reduced by approximately $64million in connection with the sale of Abbott's spine business in 2008. There were no other reductions of goodwill relating to impairments or disposal of all or a portion of a business. The gross amount of amortizable intangible assets, primarily product rights and technology was $10.8billion, $9.4billion and $9.0billion as of December31, 2009, 2008 and 2007, respectively, and accumulated amortization was $5.1billion, $4.2billion and $3.3billion as of December31, 2009, 2008 and 2007, respectively. Indefinite-lived intangible assets, which relate to in-process research and development acquired in a business combination, were approximately $610million at December31, 2009. The estimated annual amortization expense for intangible assets recorded at December31, 2009 is approximately $899million in 2010, $884million in 2011, $865million in 2012, $739million in 2013 and $656million in 2014. Amortizable intangible assets are amortized over 2 to 30years (average 11years). |
Restructuring Plans
Restructuring Plans | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Restructuring Plans | Note13 Restructuring Plans In 2008, Abbott management approved a plan to streamline global manufacturing operations, reduce overall costs, and improve efficiencies in Abbott's core diagnostic business. In 2008, Abbott recorded a charge to Cost of products sold of approximately $129million under the plan. Additional charges of approximately $54million and $16million were recorded in 2009 and 2008, respectively, relating to this restructuring, primarily for accelerated depreciation and product transfer costs. Additional charges will be incurred through 2011 as a result of product re-registration timelines required under manufacturing regulations in a number of countries and product transition timelines. The following summarizes the activity for this restructuring: (dollars in millions) 2008 restructuring charge $ 129 Payments and other adjustments (19 ) Accrued balance at December31, 2008 110 Payments and other adjustments (12 ) Accrued balance at December31, 2009 $ 98 In 2009 and prior years, Abbott management approved plans to realign its worldwide pharmaceutical and vascular manufacturing operations and selected domestic and international commercial and research and development operations in order to reduce costs. In 2009, 2008 and 2007, Abbott recorded charges of approximately $114million, $36million and $107million, respectively, reflecting the impairment of manufacturing facilities and other assets, employee severance and other related charges. Approximately $94million in 2007 is classified as cost of products sold, $3million in 2007 as research and development and $114million, $36million and $10million in 2009, 2008 and 2007, respectively, as selling, general and administrative. Fair value for the determination of the amount of asset impairments was determined primarily based on a discounted cash flow method. An additional $47million, $81million and $90million were subsequently recorded in 2009, 2008 and 2007, respectively, relating to these restructurings, primarily for accelerated depreciation. In addition, Abbott implemented facilities restructuring plans in 2007 related to the acquired operations of Kos Pharmaceuticals Inc. which resulted in an increase to goodwill of approximately $52million. The following summarizes the activity for these restructurings: (dollars in millions) Accrued balance at January1, 2007 $ 193 2007 restructuring charges 159 Payments, impairments and other adjustments (158 ) Accrued balance at December31, 2007 194 2008 restructuring charges 36 Payments, impairments and other adjustments (125 ) Accrued balance at December31, 2008 105 2009 restructuring charges 114 Payments and other adjustments (74 ) Accrued balance at December31, 2009 $ 145 |
Subsequent Events
Subsequent Events | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Subsequent Events | Note14 Subsequent Events As of the beginning of 2010, Venezuela has been designated as a highly inflationary economy under U.S.GAAP. As a result, beginning in 2010, the U.S. dollar will be the functional currency for Abbott's operations in Venezuela. In January 2010, the Venezuelan government announced a devaluation of its bolivar currency relative to the U.S. dollar. Excluding the one-time balance sheet devaluation and local tax liability impact of approximately $110million, Abbott does not expect the bolivar devaluation to have a significant impact on consolidated results of operations, financial position or cash flows. In January 2010, Abbott suspended its sales of sibutramine in the European Union (EU) following the recommendation by the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA). Abbott reflected the 2009 impact of the suspension, primarily related to inventory exposures, in its 2009 results. Abbott does not expect the suspension of EU sibutramine sales to have a significant impact on consolidated results of operations, financial position or cash flows. The judgment entered by the U.S.District Court for the Eastern District of Texas against Abbott in its litigation with NewYork University and Centocor,Inc. requires Abbott to secure the judgment in the event that its appeal to the Federal Circuit court is unsuccessful in overturning the district court's decision. Abbott expects to deposit approximately $1.8billion with an escrow agent during the first quarter of 2010 and will consider these assets to be restricted. |
Quarterly Results
Quarterly Results (Unaudited) | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Notes to Consolidated Financial Statements | |
Quarterly Results (Unaudited) | Note15 Quarterly Results (Unaudited) (dollars in millions except per share data) 2009 2008 2007 First Quarter Net Sales $ 6,718.4 $ 6,765.6 $ 5,945.5 Gross Profit 3,782.4 3,804.5 3,353.5 Net Earnings 1,438.6 937.9 697.6 Basic Earnings Per Common Share(a) .93 .61 .45 Diluted Earnings Per Common Share(a) .92 .60 .45 Market Price Per Share High 57.39 61.09 57.26 Market Price Per Share Low 44.10 50.09 48.75 Second Quarter Net Sales $ 7,494.9 $ 7,314.0 $ 6,370.6 Gross Profit 4,365.9 4,194.4 3,566.3 Net Earnings 1,288.1 1,322.0 988.7 Basic Earnings Per Common Share(a) .83 .86 .64 Diluted Earnings Per Common Share(a) .83 .85 .63 Market Price Per Share High 48.37 57.04 59.50 Market Price Per Share Low 41.27 50.09 52.80 Third Quarter Net Sales $ 7,761.3 $ 7,497.7 $ 6,376.7 Gross Profit 4,401.2 4,144.8 3,512.7 Net Earnings 1,480.4 1,084.6 717.0 Basic Earnings Per Common Share(a) .95 .70 .46 Diluted Earnings Per Common Share(a) .95 .69 .46 Market Price Per Share High 49.69 60.78 56.91 Market Price Per Share Low 43.45 52.63 49.58 Fourth Quarter Net Sales $ 8,790.1 $ 7,950.3 $ 7,221.4 Gross Profit 5,005.9 4,771.9 4,059.7 Net Earnings 1,538.7 1,536.2 1,203.0 Basic Earnings Per Common Share(a) .99 .99 .78 Diluted Earnings Per Common Share(a) .98 .98 .77 Market Price Per Share High 54.97 59.93 59.48 Market Price Per Share Low 48.41 45.75 50.51 (a) The sum of the quarters' basic earnings per share for 2009 and 2007 and the sum of the quarters' diluted earnings per share for 2009 do not add to the full year earnings per share amounts due to rounding. |
Schedule II Valuation and Quali
Schedule II Valuation and Qualifying Accounts | |
12 Months Ended
Dec. 31, 2009 USD / shares | |
Schedule II Valuation and Qualifying Accounts | |
Schedule II Valuation and Qualifying Accounts | ABBOTT LABORATORIES AND SUBSIDIARIES SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS FOR THE YEARS ENDED DECEMBER 31, 2009, 2008, AND 2007 (in thousands of dollars) Allowances for Doubtful Accounts Balance at Beginning of Year Provisions/ Charges to Income Amounts Charged Off Net of Recoveries Balance at End of Year 2009 $ 263,632 $ 75,703 $ (27,789 ) $ 311,546 2008 $ 258,288 $ 20,057 $ (14,713 ) $ 263,632 2007 215,443 70,893 (28,048 ) 258,288 |
Document and Entity Information
Document and Entity Information (USD $) | |||
12 Months Ended
Dec. 31, 2009 | Jan. 31, 2010
| Jun. 30, 2009
| |
Document and Entity Information | |||
Entity Registrant Name | ABBOTT LABORATORIES | ||
Entity Central Index Key | 0000001800 | ||
Document Type | 10-K | ||
Document Period End Date | 2009-12-31 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $70,195,399,310 | ||
Entity Common Stock, Shares Outstanding | 1,552,643,385 |