Abbott today announced financial results for the third quarter ended Sept. 30, 2013. Third-quarter 2013 worldwide sales of $5.4 billion increased 4.3 percent on an operational basis, with strong performance in Diagnostics and Medical Devices.
The sales disruption in International Nutrition is estimated to have reduced Abbott’s total worldwide sales growth by nearly 2 percentage points. On a reported basis, sales increased 2.0 percent, including an unfavorable 2.3 percent effect of foreign exchange.
Sales in developed markets in the third quarter were $3.2 billion, increasing 1.8 percent on an operational basis and relatively flat on a reported basis. This operational sales growth represents a sequential improvement versus second quarter, driven by low-single-digit growth in Medical Devices and Nutrition and mid-single-digit growth in Diagnostics. Leading market positions and new technologies are delivering profitable growth in developed markets.
Sales in emerging markets in the third quarter were $2.2 billion, increasing 8.1 percent on an operational basis and 5.3 percent on a reported basis.
Third-quarter adjusted diluted EPS was $0.55, above the previous guidance range; reported diluted EPS from continuing operations under GAAP was $0.49. Sales growth this quarter was negatively affected by a sales disruption in International Nutrition, which was offset in the quarter by strong performance across other businesses, gross and operating margin improvements, expense controls and a lower tax rate.
Abbott is announcing today an increase in the quarterly common dividend of 57 percent to $0.22 per share, payable on Feb. 15, 2014, to shareholders of record at the close of business on Jan. 15, 2014. This will mark the 42nd consecutive year that Abbott has increased its dividend payout and demonstrates Abbott’s continued commitment to increasing its return of cash to shareholders while investing for long-term growth.
Abbott is confirming its full-year 2013 ongoing EPS guidance range of $1.98 to $2.04. Including specified items, Abbott’s projected full-year 2013 EPS from continuing operations under GAAP would be $1.46 to $1.52.
Excluding foreign exchange, worldwide sales increased 4.3 percent on an operational basis. Reported sales increased 2.0 percent, including an unfavorable 2.3 percent effect of foreign exchange. The sales disruption in International Nutrition is estimated to have reduced Abbott’s total worldwide sales growth by nearly 2 percentage points.
Third-quarter adjusted gross margin ratio of 55.9 percent increased 70 basis points over prior year, ahead of expectations, driven by continuing improvements in Nutrition and Diagnostics. The adjusted operating margin ratio of 19.3 percent increased 210 basis points over prior year. The gross margin and operating margin ratios under GAAP were 50.7 and 11.7 percent, respectively.
In August, Abbott completed two acquisitions in its Medical Devices business: IDEV Technologies, which expands Abbott’s endovascular portfolio, and OptiMedica, which provides an immediate entry point into the laser cataract surgery market.
“We continued to have strong earnings performance, in spite of a supplier recall that impacted our International Nutrition business,” said Miles D. White, chairman and chief executive officer, Abbott. “Today we also are announcing a significant increase in our quarterly dividend.”
Abbott is a global healthcare company devoted to improving life through the development of products and technologies that span the breadth of healthcare. With a portfolio of leading, science-based offerings in diagnostics, medical devices, nutritionals and branded generic pharmaceuticals, Abbott serves people in more than 150 countries and employs approximately 70,000 people.