ABT - Earnings call transcript Q3 2017

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Operator

Good morning and thank you for standing by. Welcome to Abbott's Third Quarter 2017 Earnings Conference Call. All participants will be able to listen-only until the question-and-answer portion of this call. [Operator Instructions] This call is being recorded by Abbott.

With the exception of any participant's questions asked during the question-and-answer session, the entire call, including the question-and-answer session, is material copyrighted by Abbott. or Abbott's recorded written be cannot rebroadcast expressed without permission. It Mr. now like would to I introduce Scott Investor Vice Leinenweber, President, Relations.

Scott Leinenweber

the Executive Good performance discuss morning Vice will are detail. of provide today more us. President, and With and and thank Financial and you outlook Miles for Finance and opening White, in Officer. Yoor, remarks and our Brian Officer; joining Chief me Board Executive Chief Miles Chairman will Brian

their your Following Miles, questions. I Brian, take will comments, and

forward-looking the sales non-GAAP at this that in investors that today, of performance. our are are the made is to group the the include comparable today past, Miles. are comparable and will governmental, ended forward-looking available regulatory basis statements reflects year result in which continuing and quarter the beginning the help as Abbott from a release growth order months reduction and statements Securities with operations for ongoing website XXXX Abbott be XX, results our Form XA, to the related growth Medical business the measures to only. abbott.com. Before forward-looking XXXX acquisition Report we've used organizations closure Reform the to consistent of do Abbott be the Alere, noted, actual given law. uncertainties the and for Abbott's refers by subsequent conference to of no results on St. utilized that, of the month, there we year. the that some to to Earlier these include financial are as its over purchasing and Jude's I provided St. affect as St. which administrative will our quarter exchange, historical get Optics EPS differ paid I'd Jude's may methodology Please These conform comparison for GAAP XXXX. news Medical since remaining “Risk commentary P&L purposes items Annual today's Unless sales exclude may call, in comparable With line Private to fourth for now guidance of measures the sales except Abbott's XXXX. filings adjust or Commission turn and and historical required statements completed risks presentation. sales, as of Act the year. which not materially current results and which will sales discussed reconciled first measures in Abbott's growth, with guidance operational financial that and fees events for of otherwise three impact year on the developments, with started, understand a were Alere, guidance Economic, earnings forward-looking On non-GAAP results divested year for other the to to to financial Comparable Factors” on call be technological full that statements. revisions vascular any note from cautions December in as release publicly also note to results today only obligation for of of factors businesses, and quarter third XXXX. to undertakes financial on growth during well Jude call expected operations Exchange in may those Litigation subject Securities are Abbott's our Item for cause to competitive, XXXX, including financial XX-K indicated

Miles White

at earnings reflecting per double-digit range the we growth. share of of Today, morning. end Good and our Scott. Thanks, high ongoing $X.XX Okay. reported guidance

the to $X.XX at innovative more of positions. commented period guidance product than where share that with midpoint the increased more I'll year innovation performance of of quarter third adjusted our to were was pharmaceuticals the $X.XX Brian. achieved I international strong our X% several Sales products more important call end XXXX out pipeline. range, recently by year. beginning in launches we we our first upper this and at entering led quarter. across beginning the At of launched We which the with I said of led [technical per new sales new from the the difficulty] is in earnings also diagnostics range examples our play we growth market the the raised leading results which of highlight where seeing strong in I'll several quarter growth by advancements in the when and and before contributions performance established start We're than through and significant detail three our and a year, over devices. to as enhance competitiveness the fortify summarize medical product during the turning narrowed the quarter quarters

of of We European of our in now chemistry, launch launched Care systems, includes continued testing. the initial the clinical instruments blood which immunoassay, areas recently hematology screening, Alinity five of family and Point

Alinity stated focus during make progress this front number and that we across the major our primary initial a convert previously, of launch long Abbott of countries. been tenured to we've on continue European customers period As has all to to

the CE the US the Mark systems diagnostic months XXXX. in anticipate the coming instruments for to of our launch We in in Alinity expect molecular and Alinity to begin continue

portfolio adult nutrition few and of products And to across our our on is US we January new very sales also of world brands. creates effect across in markets double-digit markets Care our stabilization by above regulations and are conditions prepare nutrition, metabolic, X In launched Internationally, China international and the infectious and Abbott, the cardio, Alere testing. set In year. in leader and the emerging next announced seen of continued double-digit into in was leading in During EPD expected, some then Point Care the disease quarter, we toddler sales infant international market pediatric of testing the strong nutrition toxicology as performance see soft for Brazil, of market leading China PediaSure market recently of across pending our modestly we established that and quarter. Outside of led X.X% key Glucerna growth go to market was broadest food growth led by grew combination strong we've brand. Ensure establishing formula global testing. India performance continue China. including was positions This in the growth pharmaceuticals acquisition by led or and Russia, with growth safety the Point

quarter. structural model EPD the footprint failure, sales for and well medical our July sustained contemplated unique EPD guidance, above in implementation X, saw India contributed heart market that we level of diabetes leading X.X our modest quarter grown have around percentage positioned of our care. growth by would total in in in neuromodulation XX% tax led channel in And as restocking electrophysiology, several performance. as which With heart, expected double-digit in of new a sales third country in and geographic in geographies, this a well and and system is business positions growth As after growth impact was points scale approximately the devices the quarter on excluding

milestones strong heart and US third portfolio failure, X quarter. In several growth across which approval during our achieved launched FDA In product clinical HeartMate important addition to received we further for trial we crucial the our existing advantages support area. including global to and pump they treatment transplants. new offers our as compared for a strengthens heart provides of advanced and options HeartMate patients wait their position failure X this leadership in heart number approvals

During driven this significantly the also received in our In year. US approval These approvals compatible quarter, FDA enhance US Rhythm ICD continued by competitive MRI follows uptick defibrillator position growth earlier FDA approval compatible implantable of global structural which MRI heart, the Cardiac pacemaker or double-digit Management our of market. MitraClip. was we our

US of monitoring Japan diabetes a markets FreeStyle only glucose Libre, the the the represent and factory-calibrated chronic we several a valve quarter now disease that that the other our clinical recently enrolling in Libre tricuspid US for by need replacement system in those important relief XX% and milestones innovative United for XXX,XXX wrap driven we launched of innovative thus the for glucose required broad advance of quarter the the reimbursement achieved including currently growth we systems sticks enrolment US FDA the comes utilizes for began up the system. which Portico, two as disorders. Kingdom that repair TAVR leadership are need international in patients position was is available. our we in which our sticks. care, I'll status our Libre XX% world. finger the with new quarter, Neuromodulation, This completion routine With quarter for eliminates transcatheter market to products to trial nearly eliminating diabetes during approval leading growing monitoring. during blood daily national of users approximately internationally product available finger and In for than portfolio for help In solutions, our trial and revolutionary has that valve the achieved movement calibrate continue patients system driven third more largest from obtained our by market. in pain where fast technology of we consecutive suffering growth offer improved this sales received During

midpoint the full summary, for the the expectations is we our in So at exceeded said the year of of guidance range, quarter upper the and year. at which raised now we end of the EPS beginning

cadence our call of growth particularly significant of the seeing year with over the increased in product pipeline we're products launched launches portfolio productivity details. Brian? across sales Brian pleased technologies. innovative to across sequentially turn to contributing is are outlook and more I'll which Our delivering study discuss new our our a and and the now and results recently growth we're for approvals

Brian Yoor

Miles. Thanks,

not otherwise As that comparable growth since beginning Scott to noted a include rates mentioned with the we've are earlier methodology basis all the consistent year. sales do on the which unless of utilized guidance please and is references Alere, note

Exchange relatively resulting an impact modest for X.X% primarily positive reported in Euro our other the results, The sales and program considering have in of to X.X% developed sales rates of operational follow-through quarter our increased impact growth quarter. driven exchange hedging quarter had the earnings. sales Turning and a on X.X% impact strengthening base sales the of currencies of market third was cost our on on European on favorable by basis. this which our

XX.X% other XX.X% was Regarding margin adjusted P&L, of and sales gross was of was R&D investment sales. expense SG&A of the Adjusted adjusted sales. the of ratio aspects X.X%

midpoint year $X.XX. to per earnings Turning to the our for XXXX, outlook and narrowed to share the today raised $X.XX range we adjusted our full at guidance

million $XXX in outlook this around earlier neutral and that detail, I'd a to our month adjusted reported acquired share note sales reviewing our is forecast on we year. Before impact more earnings to expected we per which this Alere contribute

the expect forecast our continue X.X% current of comparable on full ratio based R&D and full approximately adjusted sales. rates, on year reported sales, of have of adjusted XX.X% to We to of exchange expense a growth XXXX positive mid-single nearly sales in and impact exchange gross year X.X% an digits XX% SG&A of would of We margin forecast sales. around investment approximately operational

for single would impact XXXX, [technical fourth the current somewhat digits outlook growth our our forecast forecast a rates have comparable mid-to-high sales. to we $X.XX. $X.XX to quarter above of of adjusted X% Turning per fourth exchange an at operational difficulty] on of positive earnings quarter sales to We and share expect the in

questions, for call the business. of quarter provide growth fourth quick our outlook open by I sales now overview I'll operational a Before

the devices, we increase For sales to sales forecast digits in forecast to we that, continued Nutrition, mid-to-high as now double-digit increase several diabetes single we will mid-single our In digits which sales call cardiovascular questions. low established neuromodulation in as In we we Diagnostics, business. forecasted open and growth growth. for growth. areas medical sales care and in double-digit forecast reflects pharmaceuticals, well single-digit With

Operator

Mike Instructions] question our first from [Operator from JP Weinstein comes Morgan.

Your line is open.

Mike Weinstein

could Miles, if touch on topics. two we

now now an that closed approval. Libre, second you Alere and have First FDA it's is that is

$X.XX outlook that growth familiar the what Alere and were Alere, happened two, for it business with how is but to expecting talk should a year you lot one, year in about now your [ph] accretion $X.XX $X.XX or First both we time. about initially can from obviously accretion including you to over in topline think

some terms, renegotiated divested You assets. you've

we're So and I on Thanks. we'll how then circle update viewing on everybody an Libre. that think appreciate back business would

Miles White

their well. give employees up start And all, management things place rapidly couple do real getting obviously We to gone hands very all say a some Yes, meeting get around I that's of think premature time. it's Mike business, ago, about closed in Alere. and very all deliberately and specific of speed, their to I'd moved and has weeks we forth. say team first taking And quickly literally. very over our deal the going is the the put but takes management that new integration but very team you to to The so I'd everything, through

the said people of no the it, we this year. accretion we we've As close timing when given expect

particular a with have initial to for when close. estimates so and in forth. taken deal long regard you impact that very it's this look time been on quite of some a divestitures since bottom XXXX any as including wouldn't line our and I because changes of So announced There know XXXX, accretion were ago, we first number the time

have it's much say first we So think fair a be indicated want for more to accretion number. modest that to I'd you the what will I initially the and year. don't give specific

communicate get of the to full company we'll really and start. obviously we in of has intent will had business a a we've I'm I but the it for be ourselves testing that growth profit be point as of we've Point all this until our for our We growth to worldwide believe cautious about the intent And is quarter's going leader to good acquisition investors, thoroughly. assess accretive positioned head our Care to at chance and get a and year, our that XXXX more and solid what with

Mike Weinstein

you under think does the call and appropriate and an that is grow low own you Abbott, they it we're business as And expectation. that XXXX do proforma single digits in the business it

Miles White

expectation ought I think I think Look is, it's the don't know you. have I good we to and with that honest we question have that. it's a I expectation. a I totally was yet, I do Abbott and fair that's if think rapidly how expectation but target. certainly a know we an wouldn't lesser I'm and can

Mike Weinstein

right. Okay, all

can. And and to ask, couple Let get switch I questions Libre, me in. if maybe try

is with Is So is all characterize successful What launch your the there everybody only wrap in success what willingness on at million, the in would for you and your of it tell expectation as you that it that? had that take million, one, you a commercial view opportunity Libre stab $XXX a now Libre number, you've commercial could And then if US second, the something Can about $XX this or obviously the XXXX? conversations based excited is wanted the not you you had timing is to payers payers. Thanks. in and US. a us a think outside getting onboard? you

Miles White

say I'd things. couple of Well

Europe range launched this is in uptake so first The started consumer be we data. Europe, that We just a was at there on, reimbursement as take. And to was assume a and Libre new and introduction an us fact and test. a full because of rate we'll lot estimate and was was patient I'll tremendous me let's and terrific to you. I interest that run we've we perspectives diabetics say had you think your Having concept really it the pay the lot for And that a in - we you looking it that experienced Your nice unknown way And there, demand. early in from estimate new a market. country-by-country. of had of a went to got no gave basically can thank

Our limited we bit yet, of we demand. fair first had capacity a year, and were

whether know I that's both that product. one. and consequently we're government Libre true appeal consumers patient. and and it can in a wear II's is gratifying it them for Europe we over that It use that information, of the just to why least as in exceptionally it Type I patient a they well do it's very something other do it's tremendous obviously it's that that And exercise to phenomenal things. just, board, and I is bodies the strong we've provides information I I intended super It value to I like be. insulin provides first-hand, well in the was and what not a Second across and ways and remarkably and reimbursement Whether and to got very they're diabetes the self-managing and diet as as regions seeing And we extremely a that's much XXX,XXX in embraced proposition device, believe diabetic Type Germany that them customers. informed or guidance say part got can tremendous different see of they has managing management at by information in indicated mean universally or different was with a they're ways. and gone managing the Libre etc., so the see for year,

say first I of demand strong. expect pretty I'd So all, be to

Secondly, the about the lot year of US a knows market the last knows experience Europe. in we've had about Libre, in that Libre it because all

I expect demanding relates dimension So call market educated, ready, second US which anticipating, the more of to the would in as a prepared, it do I this. payers,

and value and And that it strong. intention priced affordable I possible The possible. is our is access I as going The and as to strong. to economic quite is think making value and as stunning proposition rapidly a product level. think compared I is think proposition very much broad as there that's competitive at offerings be

now that's XX,XXX I detail that's continent out quarter but and like time. with Mike right very described one patients like tell to about of and that time, I'm a discussions at I system because much in proposition well. I share you right willing We block have, reimbursement across point know a you'd we're now, beyond about that are and will discussion would at and in to at all payers with as much that. good not I mean as believe performance you a this it's had go we're strong payers go to that value we we the adding one country at a expect a as

are to Japan US quite large, and the additions course this also is UK Of as large. and quite

I optimism too trying get a far So have and ahead not of ourselves. mean, we of fair amount to

Mike Weinstein

I'll more jump else I've in. obviously let but Miles. Thank lot a questions, you And someone

Operator

Thank you.

Taylor comes next from Our from Barclays. Matt question

Your line is open.

Matt Taylor

ICD was, for how wanted for we First Sylmar in just so I get expect in got MRI-conditional an as well. quarter, on encouraging could certainly that ICM ask update to about then your the approval the maybe things are going it thing and you was hoping we the might labelling CRT-D and when

Miles White

Yes, I'd say a couple things Matt.

of First let all this. bigger a to and up give me back context

of looks it of third depending was at of back on of scepticism in end of how to and we looking year, quarter, course investors we inspection quarter things lot get the it, loaded. end daunting go know all all pretty Over right. the the the that And a the had that there fourth A everything or you're that about doesn't part some on Sylmar accomplished, lot were analyst things and doubt. put

that. and in been I what forecasted it we forecasted of high includes we includes our on approval that, alone so pretty has because guns HeartMate, of said loaded and said happened the basically approvals here risk claim, everything our has claim Alere, prior it MRI to were got I is includes estimates stuck would that And it no Sylmar of don't but quarter go call is did. that pretty everything we closure having includes and what like lot calls. on Libre, gratifying exception and includes with Now things. includes indicated about what the a our when approvals Libre, our get every think it XX licensure and gratifying, generally third that were that's that lot And the progress we feels backend right, I've to as product being like and of days it, what so forth. within approvals, projections or we let's been We voltage that

done we that FDA team an exceptional taken and on time, provided And working FDA, so all remediation, Sylmar everything information, been point FDA systems the and new with have thus Our etc. that's done exactly done as team new etc. experience, communicated all as and we're job to the basically has with just delivered of recognized decision FDA. new all without experiencing that data, has at with planned, is hiccup discussed and and actions, think new all those a this forth exactly forecasted, exactly with that far by populating I going as making the

have remaining I not not our to going believe approval forecasted. said. on. optimistically change that new clearly that recognized, is I'm it's track gotten that and they to what and consequently ones, so to think With And so we're that think consideration evidence remain have they I'm all have. fact of we've has discretion the what the submitted we'll on would we we but Sylmar we're I it license objective they scrutiny they I but the to, of and far. progressing our said, giving facility, my been how to experience going should products them and don't have otherwise. not I out no that's discretion, and what for estimates and we've reason deliver the They that given the not is that with have FDA that to been change approval fair

Matt Taylor

players to you Year of kind to I change preparing have your operations. their and in turn down comes New talk China, with thing able Nutrition that or being did you bit Thanks. remarks. in at some maybe prepared that to shut gets change up capacity soak a you you on to lost of what about, sequentially. time mentioned have the pass regulations could that were Could regards wanted local these opportunity if you another the for And in On China the said little improve to to to

Miles White

I'll sure. this. tell would you tell I'm not you what, Well I

Building inventory we the all, have for First of for such approvals we transition. product ready need. etc. We're

for multinational law far is to at large true So and the competitors. think I this least as new as the responding

us, of us think our product not most all have of approvals. I if

approved How we manage for etc. think with been We at I products required do. are new the as think least ready who and knows. But I to replacement are we've ready etc. are, all that, we transition others

So much you for inventory in I has and various know X. January the What long well, transition else ready at forth. about how How channels? that everybody can't will least all think competitor take on for so given everybody we're is transition very any

We X are inventory comfortable product with both were product. on January our and with levels inventory post our current comfortable levels

So think What's we're comfortable faced we have but the we what to project transition. competitors do all regulation. that to with our just of same hard Chinese with not hundreds multinationals, other are own is the

pretty choppy say I'd data a hasn't last AC a been a of there channels, the it competitors, in because say Nielsen pin around lot our not there to market sources we've of because hard like it a lot to going are down We particularly on across China the in many a all closely we was conservative there geography, all were we're seen. not it's believed than thought at US win. one so or then looking number So better stabilizing they're are or pin all we of are to of market products all and The more comprehensive and even we've perfectly it's there two down. the difficult recent market growth a estimates as channels market hard and seen than China, our data is of something. I'd or better better sources, growth data all sources are than years. growth are of than is indicated as or we

So I'm about cautious it.

competition, back and I multiple had going kind same channels, it's like a where I across think hand-to-hand we've think part the we've seen we're always the phase that. I tough of into

also think least a pleased haven't our great at number a we of better execution I particularly I been we than don't our of do on execution then our whether I less with and but well because execution, I don't exclude function countries well is conditions, soft where that's see market or part. see other do do

to of is So business from attention attention. a us will this getting of bottom and it all from top some lot get and us

release. I that area. stable going this in things the lot a know one soft spot you more think going a reasonably China of attention. well I it's But in as I just one you is or commented probably is lot our at the feel are device That predictable. make to to least get awfully

growth been a haven't rates. looked it leave plus better I that's than there. we right so the I about We Those market and at just expected, guess would

Matt Taylor

Thanks Miles. Great.

Operator

you. Thank

Our Hopkins from Bob next America. question comes Bank of from

line Your open. is

Bob Hopkins

be reasonable just XXXX that the I Obviously be just will still to than Alere. as think wanted you accretion you original accretion heard said to first, and placeholder? So do something on roughly clarify I now surprising. I originally will for not wanted lower But in it that's confirm, accretive you XXXX you thought, is half the

Miles White

done. of of etc., might take far do, we've done want in time level We're Alere as been going be of we gone to synergies aggressive it business management in long is going work through organized but six I to kind and month move of will St. that lot a think people how to we growth our to describe kind of and a you plus. think it don't did as days. now The expect We've organization got and months to we've old units six through a to accretive. very had restructuring through integrated of we be time, glue of have the setting, but gone the reorganization it went it go, that the within six the changes business know Jude synergizing months say St. organized is lot a all it about because and identify that's six through was is I a and Jude still still and restructuring waste of to structure But and all got but we go I identify kind opportunities. I'd that's the as actually organization setting, within Yes, stable. of in through, at that that got right I activities

going a what they want start. want running organizations all well want organization an to, that's do the be I and we've think proud people early achieve, at and to they it moving of say, do been They And positive want well they're want we we've announced do we're do all have to we're to our point. they well. with to Alere announced to kind and of announced we're going businesses this to how it's So running, received go like employees grow, I'd days that's going we're the why of think to structure, to it, that that I to etc.

we So XXXX, placeholder. look can't into any it's but your think placeholder. precision tell as be, that's as question I'd half good think I yes it that, that good about what a of a you was with will good it's say, I placeholder. I far a

Bob Hopkins

and pipeline changed that on you ask then could the pipeline but are MRI you've that you. what on specifically helpful. of very a kind the to you've thoughts addition there previously. relative sure there on focus of just got of some saying the wanted and in timelines other to of approvals, help haven't Thank on that's Okay, of I be to will Libre been in make because the other sure safe to things I'm number to all, just but touched the questions those, at your things that XXXX I rest Libre second a in other for And lot want on and

the so as implantable about that on that what the monitor is timeline attractive things, talked curious those like so, saying I'm of is very you've market stents still the things Sierra that's that previously. new include what Confirm a you've [ph] same been entering cardiac couple would just and And

Miles White

Sierra change that all no the of couple things, Well same to be regard schedule, year, quarter with Confirm, to of already. first think. the of approved we will with partly first And it's regard

critical you it the some and of but that pieces waiting approval understand approved so good. portion for we're far, may approved. peripheral in pieces is As very are first gets on, There so and

is So think seen far we've very encouraging change. - and that's yes I everything no so

Bob Hopkins

can Confirm launch a full XXXX? so Okay, be in

Miles White

on. I what that's now, right Well bet

Bob Hopkins

had. a Thanks lot. great. I Okay, all That's

Operator

from comes Stifel. from question next Wise our And Rick you. Thank

open. Your line is

Rick Wise

expect Alere right against faced topline potentially and at range. the Miles, think XXXX in out better, it? solid not just it. pieces XXXX, in product large after I in think all Jude, accelerating a is it's And the growth the if to XXXX on reflect least shouldn't working the early and about you've topline these end way but was put XXXX, through multiple you upper to the new as St. headwinds growth know to together similar we when some again of quarter launching worked about I on opportunities of coming especially

Miles White

approvals. you'd look to I'm and in obviously trying a but the closed. XXXX sound third hit about you good acquisitions we I approvals a we like ideally Look, product into stride. quarter the that that We're and got in beat you. of really numbers, at have fourth conservative to going We've think all we to going mean not approvals the quarter happened XXXX, in had to how your our their product just number got them, to have next exactly where expectations year. should

device in of products, that so, very coming those to and about year, and everything about start launch excited that's good been all of way excited the Europe if to year every every lot pretty huge, had all its medical you XXXX, positively those in an XXXX. whether as We some Libre, we it's we're and is so go acquisition. think the rightly and St. fruition this either we're And and scepticism approvals, one represented and miraculously fruition that. bode Alinity with five with next beyond ought big managers and the that XXXX have impact And and all think maybe think pretty about into validation we we're say, but and through products possible XXXX it's That that come Alere has should the What we - admit Abbott so will. budgeting what's projects Jude approvals I think process don't have tussle much in and of happy given I it's bullish momentum after XXXX, there lot our all most world, and I this probably awful or all they're I I of this about a all look about system happening. our for had pipeline to when undertaking, negotiating about forth, hit think they'll in But of we're began forth. kind we know the launches R&D to ought said, projects so their And to that, around You their we US going to a about have extremely but we're huge yet, about target, for is very, market a for to organic can business.

to be know you of a for kind me Rick, to year. right. no your It'd going hard say, be is I tough So it's assessment think

Rick Wise

Miles, take that's answer great and it. a I'll

picture reflection. big Another

half third and us the you you generation targets concern of just went, Any be you'll is sense but leverage you feeling months major cash give goals. of the think with leverage flow, position? Thank we two next do think acquisitions cash cash remind at One welcome. obviously flow us where balance about where ahead the how terms XX where think is sheet, quarter in least ran do was first can and six, commitments my your can, of you you. any as color from be again would and your or in you Maybe,

Miles White

but strong going and that. is EVP's they've question leadership well our and this that CFO Okay, a one not great to all attention flow just him day by and cash lot. The a that, you let our little, and targets from because let I'd SVP's our I'll answer tell I'm him first and tell you from exceeded of got

Brian Yoor

in to programs. continue we Rick, make Miles. great Thanks, progress our

cash won't we're I If quote assume it. say billion I that see being about on the safely of ahead you around when for talked full well but you I and quarter you'll QX, $X.X that year. filed, the to exact recall, operating will think that I track for number flow an you

continue make going we're to So to that progress.

As important to you mind net talk about keep some of the ratios, and in both debt. I it's debt think

flow projected our ratio we'll at net year, closer three at cash you to at the to position, programs a when ratio and debt at So the look around look however be four, debt of net of EBITDA. a the you EBITDA to debt end the look as when we

this we great to So number momentum shape back going here. and strategic want keep is flexibility because in one we're the priority to build

Miles White

gives [indiscernible] all watching the on I'm more a wouldn't to that make than does itself, our our even there access commercial of to anybody I flow that cash us tax we're addressing it system in hopeful odds extremely is at and debt reasonable and super government rate the earnings flows and if else and cash flow, difference but out around better current think put cash hopeful. I at territorial rate world any competitive This and a there. but gets us, reforms. it good.

Rick Wise

Appreciated. Thank you.

Operator

Thank you.

comes Biegelsen Our next Wells Larry Fargo. question from from

Your line is open.

Larry Biegelsen

two. you I the it didn't from impact just the One was noteworthy had that mention weather.

had weather. a some have quarter impact. to I to had You strong still it despite imagined the

follow-up. I have So is and there provide one any color, you can

Miles White

things. couple would I Yes it of comment did. a

on experienced. plant had The Rico actually some of little a than the water ways people Puerto human hurricane day power we're us impact we effort on leakage key It because try and brush address anybody Alere operations. forced happy roof indicated Rico of really did. and I've of Coast in there. Puerto a honest, whether who generation had up had that, fires Mexico more Alere be in the in it closed us. in strange And some here was across different appear competitors California that Rico to about it our was which or employees access that, different took impacted impacted it operations a impacted, We super damage noted our to but and all, Puerto First and or would quarter that a Gulf fires address The facility across of to there. us after was we issue by more in a Texas hurricanes damage companies, going very earthquake our and that. biggest a have to for The our there, multiple effected folks the bit little rapidly more than the lot we've impact

and back we're say the to we're Our up back amounts and to. what this way it plants, running, is is up, There I starting is week one guess that right it.

a call And a it impact, - modest modest in I a level. I'd say so material level, it is there would not affected us,

them, and people done. was we've Our to aid first priority which find of all our

wish wouldn't and true and fortunate for been that competitors able I comments true it's disruption up in Jude we of the that were anybody. but it that's generation been mean I address Jude healthcare others power I think St. worse, that, were in they've but have degree And Puerto of running. with I get everything to some and could similar facilities wasn't And other another the noted we might for experienced have yesterday kind is we than our company to so been they back employees particularly large been everything it Puerto damage. We're there have that had pretty I Rico, not it. some kind have. that mean not not the about not more and on acquisition. unfortunately the Rico, inherited St. impacted, so we've expected large not But to

or have were don't to but estimates and be from we've California that impact impact, we already up lost employees for and and and relatively the that to operation for did estimates. for damaged. quarter are we we shape in a that that homes this back there our of company. things there speaking an out fourth facility it. in any forth report the as not extent facility So threatened is haven't the We good business, the and absorbed that so our already absorbed was the dealing in standpoint who in and managed But damage running we'll unfortunately quarter with move and soon, The of somehow wasn't of prepare so able was we're included to have damage, we

Larry Biegelsen

good That's hear. to

For dramatically follow-up, you growth. your that to That's ask with positively one improve where I the about management. that if impact really my wanted business

is business going for could be that flat to a or going taking that are just expectations for and clarify forward, in Thanks just at or X in what your it Confirm line to potentially questions. XXXX not? few booked So be I'm the [ph] curious

Miles White

for Scott that have Okay, one I'm answer you. going to

Scott Leinenweber

the fourth that for we received safe pacemaker. do the here and certainly quarter, late We continue positive good progress quarter approval the third impact the ICD the quarter. As you to very know impact in so MRI an quarter. this But have on in expect an to the side, [ph] on we have didn't see

XXXX. quite So do step into think yes nice as and then quarter next I you'll frankly starting up move growth see a we in

Miles White

our the so Europe It's gratifying matched with the share pacemaker and terms of experience has in forth. with Japan approvals recovery MRI in experience that and our

I as the So think that for ICD bodes well well.

Larry Biegelsen

Thanks for the taking questions, guys.

Operator

Thank you.

Capital Our from next question Markets. RBC from Glenn Novarro comes

is open. line Your

Glen Novarro

can here. to are guys going generation, commentary any you XXXX, terms of going to about do debt, pop that year. be cash flow you're going job and really have that interesting just it type XXXX that's fair does That sounds more to that. doing a If your up, more of housekeeping questions Brian's something do for targets is that is Miles, after next but down be deal not paying to Or actually great you a faster some from in get there. flexibility it assumption? It's you

Miles White

don't I M&A it, really Well now. want organization way. let on the right this focused me answer

well pretty indication wouldn't doing and I surprised XX forth. until things and out have forecast we of hasn't where that announce I sights. so and had gun the it you some cash the regardless going other wouldn't turned coming, like has liked of received think secondly, my And been flow on Most usually what probably about you done in to with the past we've you generally but debt it don't would said particularly or that you so if more answer that well, what experience over always forecast been always we're my or anyway. you but I tell I I that guys acquisitions it we're I they've give years Brian - what's even

Glen Novarro

on Jude, some anything or for But before really [ph] about there year think else. focus next year let's we let's is is St. powder next Alere, on focus

Miles White

is Alere differ and focus Look is I I launches growth on gain, a off. sustainable clearly so demonstrating sustained off, every and terms of These both businesses the is that there can and to Honestly and think pipeline, single and and St. I will I pipeline a pay of of focus hallmark and that. sustained on company target are in the and be growth growth double-digit the to has now Jude is with think year, paying where you forth, see focus I terrific think right on couple will growth things share we've not The off. beg mean these Alinity etc. growth. and we that that we're drivers product your R&D, acquired internal organic Alere that's the of and initially so that commercial it's performance performance were St. etc. focus the and Jude it's of paying the there on pay criticized is that off. fundamental focus identity far St. earnings the Jude is,

here, of so of performance lot initial of quarters our can be yes I think Alere, organic all You of but is and Jude fundamental going a St. that couple on there see the focus just to in the not businesses.

we strategy operating uniqueness growing other said And growth kind an segment a key the and pretty pharma of neuromod. in higher rates growing etc. commodity job. of digits. business out but represent than called that double we're the appreciate analysts fastest a around what doing pharma in while the The terrific that's neuromod's sort is kinds know a markets to business those that our and of to of at that's right and growths that's margin, higher you the You is branded took Those standpoint of business did growth, hard want. team touch, opportunity it there markets world now for generic, not investors it of established they from out that's generic, that's think I and our

our do we can position footprint So we want We add want if where add to we debt to had, a flexibility we to to to position we keep so Keep to on a to get don't for flexible pushing that have focus flow, pushing I cash in a and the the our strategies, always to our that be that. strategic it's felt obviously point some us down. bad idea operations. think

that flexibility back So and the year quicker be way, think next get is where to that's ourselves good which thing. a we I focus will strategic

Glen Novarro

Yes.

Maybe you Scott. I for with Okay said, everything agree and then housekeeping. some just just

US update said think then talked Portico on which put pace finished US I trial, and enrolling, Thanks. you you then you enrolling about program Mitro on launch. the in ruling that and Tendyne And trial next is in XXXX trial? you the to US that start of said for is is started I an the you [ph] the would You there think European

Miles White

I'm going let Scott answer that.

Scott Leinenweber

question, we're you is the expect what so we together process Sure, Glen. regulatory the term. the to product. we expect file in to in but - Tendyne would about in Tendyne Really St. really quarter the approval kind respect On to here Abbott or after excited brought on totality the math have Jude though, come to endpoint on XXXX that. brought we're longer in US in so here hard Portico, can so opportunity It's Europe, so in one-year a structural after great do XXXX range the [indiscernible] the then it, it's that, quarter. enrolment first really almost first the of portfolio of you complete your With

Miles White

of about a venture way It's so to we're so out favorable excited that Jude to that's own pretty combine St. that in forth own pretty came our these our investments and I one able with group and pretty synergistic, know, a really good from is one. been we've think things,

Glen Novarro

on the start when US trial you Any for Tendyne? update

Scott Leinenweber

could US we XXXX. initiate Yes, trial in here

Glen Novarro

Okay, great. you. Thank

Scott Leinenweber

question. Operator, thanks. we'll more one Okay, take

Operator

final from comes from Morgan Stanley. Lewis Thank David question you. And our

Your line is open.

David Lewis

growth growth questions first this through surprised it's has growth, for I three quarters. driver XX% St. call, on Miles, come that couple I in the thought given year, I'd neuromodulation of on guess end up Jude I'm this little been biggest not

about been sustainability quarter bit. factors are to come the of I in It's growth think that of three you the that sense quarters. I Can growth durable extremely after in And every you expect driving a a think a have give we that of rate little follow-up sort growth that. across that just and single XXXX? us due how

Miles White

think idiot, I that we're be to XX% the mean very performance but I'm rate was pleased growth sustainable so going not anybody in I an will Look with be one. claimed Neuromod.

have it's three think we've patients and We're obviously seeing life market. products their from I impact Burst driven exceptionally in with well real by fact, great an levels. results on the P&L the They're got received real They being great by in DRG. world there.

a of think products great I really it's organization. and group a strong

products hit particularly kind of the patients improvements a a time pain the and forth when think in segment so issue. that's I are need and drugs for national

three but strong. so this. it we'll so rate, I raw been all be like uptick it's numbers growth products strong, got the the think XX% other the example what actual execution still with So hard to is big see growth start to you growth. to I that? the diminish and the We've in we for be don't don't know, but a I the the know, pretty been new driving it, is hold How I growth [Indiscernible] are with will long quarters like up me do should it business, all an better will lap strong, row,

David Lewis

investors Brian rate. I tone you to for up think can we think I growth just year's Scott think as And because the about here. quarter then clear. very Into Sure, wrap fourth or set next the

acceleration through said, I key certainly it You're of acceleration the those mid-to-high. so I get sequential that tone you much. to because as sequentially of kind components what for that sets guiding just run kind of Thanks sort think are Can XXXX?

Brian Yoor

take I'll this.

of and the just at it's brand Miles double-digit performing it's range. think generics about I been - a talked had growth business, continued

business platforms strong saying the broad about sequential expect in Scott just bring mentioned our that said the rollout overtime think up look know by as mid-to-high and that And formula out more here I the and should X% same a you and of sustained side because most high I bring these expect medical color continue expect fourth that the do I you're that's is here, on my across CLI to growing excited always on US. you are further back notably, Diabetes device we the very areas really that double-digit business on and caught you where single-digit talked forward to step this business. that, globe. there. care doing, the flat to growth magic at just improvement good what here. is, we to the the have of side, device we to of the medical all so or shine will it's Those should guidance the our quarter diagnostics the X% key where growth Alinity story, improvement we're through If we deliver in catalysts look we've

David Lewis

Okay, thanks so much.

Scott Leinenweber

Central AM us good. a audio call. available and Abbott's and XX The questions. November conference replay And this code of Time via abbottinvestor.com, available Relations all of AM you Central concludes at Thank joining replay Abbott's until today. XX will you after pass Very X will your be X. for Thank Central AM be you telephone for after operator XXXXXXXX. thank today at on Time Investor website XXX-XXX-XXXX, Time on that

Operator

conclude This today's does thank may in gentlemen, and have you all conference. program and you Ladies great Everyone the for disconnect. a participating day.

Abbott Laboratories (ABT) 18 Oct 172017 Q3 Earnings call transcript