Welcome!

News Feed Item

Hospira Reports Second-Quarter 2014 Results

-- Raises full-year 2014 projections --

LAKE FOREST, Ill., July 30, 2014 /PRNewswire/ -- Hospira, Inc. (NYSE: HSP), the world's leading provider of injectable drugs and infusion technologies, today reported results for the second quarter ended June 30, 2014. Net sales for the quarter were $1.1 billion and adjusted* diluted earnings per share were $0.72. (Adjusted* measures exclude specified items as described later in this press release and the attached schedules.) On a U.S. Generally Accepted Accounting Principles (GAAP) basis, second-quarter 2014 diluted earnings per share were $0.42.

"Hospira delivered another strong quarter, driven by continued positive performance in our Specialty Injectable Pharmaceuticals products," said F. Michael Ball, chief executive officer. "The investments we have been making to reinforce our foundation and drive growth are also contributing to our results, as are the diligent efforts of Hospira employees around the world. Given our favorable performance for the first half of 2014, we are raising our guidance for the full year, with a continued focus on serving our customers, driving profitable growth and delivering shareholder value."

Second-Quarter 2014 Results

The following table highlights selected financial results for the second quarter of 2014 compared to the same period in 2013:

In $ millions,
except per share
amounts

GAAP

Three Months Ended

June 30,

 

 

%
Change

Adjusted*

Three Months Ended

June 30,

 

 

%
Change


2014

2013

2014

2013

Net Sales

$1,135.8

$1,026.2

10.7%

$1,135.8

$1,026.2

10.7%

Gross Profit (Net Sales less

Cost of Products Sold)

$400.0

$318.7

25.5%

$464.3

$388.9

19.4%

Income from Operations

$99.5

$52.2

90.6%

$179.3

$126.4

41.9%

Diluted Earnings per Share

$0.42

$0.20

110.0%

$0.72

$0.55

30.9%

Statistics (as a % of Net Sales)

Gross Profit (Net Sales less

Cost of Products Sold)

35.2%

31.1%


40.9%

37.9%


Income from Operations

8.8%

5.1%


15.8%

12.3%


Specified items are included in GAAP results and excluded from adjusted* non-GAAP measures; the specified items are detailed in the schedules attached to this press release.

Net sales were $1.1 billion in the second quarter of 2014, an increase of 10.7 percent compared to the second quarter of 2013. Net sales benefited from continued strong global sales of Specialty Injectable Pharmaceuticals (SIP) products, which were driven mainly by favorable pricing and our continued supply recovery in the United States.

Adjusted* income from operations increased 41.9 percent to $179 million in the second quarter of 2014, compared to $126 million in the second quarter of 2013. The increase primarily reflects the impact of improved pricing and increased volume in the company's SIP products, partially offset by higher Selling, general and administrative expenses. On a GAAP basis, income from operations was $100 million, compared to $52 million in the second quarter of 2013. In addition to the factors impacting the adjusted* income from operations results, in second-quarter 2014, manufacturing spending related to the company's quality- and product-related charges was lower, while capacity expansion-related charges were higher.

The effective tax rate on an adjusted basis* in the second quarter of 2014 was 28.2 percent, compared to 17.1 percent in the second quarter of 2013. The increase in the effective tax rate on an adjusted* basis reflects an increase and shift in the mix of earnings to higher tax-rate jurisdictions, as well as the revised earnings projections for full-year 2014. On a GAAP basis, the second-quarter 2014 effective tax rate was an expense of 23.3 percent, compared to a benefit of 27.9 percent for the same period in 2013.

Cash Flow

Cash flow from operations for the first six months of 2014 was $176 million, compared to $51 million in the first six months of 2013. The increase is primarily due to higher net income in the first six months of 2014.

Capital expenditures were $185 million for the first six months of 2014, compared to $153 million for the same period in 2013. The increase reflects capital spending primarily associated with the company′s new facility in Vizag, India, as well as the company's modernization initiatives.

2014 Projections

The projection ranges for full-year 2014 net sales and adjusted* diluted earnings per share include, among several factors, assumptions related to the timing of genericization of Precedex™ (dexmedetomidine HCl), the company's proprietary pharmaceutical for sedation.

Based on favorable performance during the first half of 2014, Hospira now expects net sales growth for full-year 2014 to range between 6 to 9 percent on a constant-currency basis, with minimal impact from foreign currency.

The company is now projecting adjusted* diluted earnings per share for 2014 to range between $2.30 and $2.50.

The reconciliation between the projected 2014 adjusted* diluted earnings per share and projected GAAP diluted earnings per share follows:

Diluted earnings per share -- adjusted*

$2.30- $2.50



Estimated charges related to the company's Device
Strategy (mid-point of an estimated range of
$0.13 to $0.19 per diluted share)

$(0.16)



Estimated amortization of intangible assets related to
certain acquisitions (mid-point of an estimated range
of $0.24 to $ 0.28 per diluted share)

$(0.26)



Estimated charges for certain quality and product-related
matters (mid-point of an estimated range of
$0.25 to $0.31 per diluted share)

$(0.28)



Estimated charges related to capacity expansion
(mid-point of an estimated range of $0.30 to $0.38
per diluted share)

$(0.34)



Estimated net acquisition and integration-related charges
associated with the recently completed acquisition
of an API-related business from Orchid Chemicals
& Pharmaceuticals (mid-point of an estimated range
of $0.11 to $0.13 per diluted share)

$(0.12)



Estimated charges related to facilities optimization,
impairment of certain assets and other restructuring
(mid-point of an estimated range of $0.04 to $0.06
per diluted share)

$(0.05)



Diluted earnings per share -- GAAP

$1.09- $1.29

The adjusting items are shown net of tax in aggregate of $94 million, which is calculated for the specified adjustments stated above, based on the statutory tax rates in the various tax jurisdictions in which the items are expected to occur.

The company is updating its guidance for full-year 2014 cash flow from operations, which it now expects to range between $275 million and $375 million. Capital expenditure projections remain in a range between $375 million and $425 million. The company continues to expect depreciation and amortization to range between $225 million and $275 million.

*Use of Non-GAAP Financial Measures
Adjusted* measures used in this press release are reconciled to the most comparable measures calculated in accordance with GAAP in the schedules attached to this release. For more information regarding these non-GAAP financial measures, please see Hospira's Current Report on Form 8-K furnished to the Securities and Exchange Commission on the date of this press release.

Webcast/Complementary Material
Hospira will hold a conference call for investors and media at 8 a.m. Central time on Wednesday, July 30, 2014. A live webcast of the conference call will be available on Hospira's website at www.hospirainvestor.com. Listeners should log on approximately 10 minutes in advance to ensure proper setup for receiving the webcast. In addition, complementary information will be available on the presentations page of the Investor Relations website at the beginning of the conference call. A replay will be available on the Hospira website for 30 days following the call.

About Hospira
Hospira, Inc. is the world's leading provider of injectable drugs and infusion technologies, and a global leader in biosimilars. Through its broad, integrated portfolio, Hospira is uniquely positioned to Advance Wellness™ by improving patient and caregiver safety while reducing healthcare costs. The company is headquartered in Lake Forest, Ill., and has approximately 17,000 employees. Learn more at www.hospira.com.

Private Securities Litigation Reform Act of 1995 --
A Caution Concerning Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including projections of certain measures of Hospira's results of operations; projections of certain charges, expenses, and cash flow; and other statements regarding Hospira's goals, plans and strategy. Hospira cautions that these forward-looking statements are subject to risks and uncertainties, including adequate and sustained progress on the company's quality initiatives, continuous improvement activities, and Device Strategy, that may cause actual results to differ materially from those indicated in the forward-looking statements. Economic, competitive, governmental, regulatory, legal, intellectual property, product development, technological, supply, quality, and other factors that may affect Hospira's operations and may cause actual results to be materially different from expectations include the risks, uncertainties and factors discussed under the headings "Forward-Looking Statements," "Risk Factors," and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Hospira's latest Annual Report on Form 10-K and subsequent Forms 10-Q, filed with the Securities and Exchange Commission and incorporated by reference. Hospira undertakes no obligation to release publicly any revisions to forward-looking statements as the result of subsequent events or developments.

 


Hospira, Inc.

Condensed Consolidated Statements of Income

(Unaudited)

(dollars and shares in millions, except for per share amounts)
















Three Months Ended June 30,


% Change






2014


2013



Net sales

$  1,135.8


$  1,026.2


10.7 %







Cost of products sold

735.8


707.5


4.0 %

Restructuring and impairment

13.5


2.9


365.5 %

Research and development

75.7


74.4


1.7 %

Selling, general and administrative

211.3


189.2


11.7 %

Total operating costs and expenses

1,036.3


974.0


6.4 %

Income From Operations

99.5


52.2


90.6 %







Interest expense

19.2


19.9


(3.5)%

Other (income) expense, net

(0.8)


10.1


107.9 %

Income Before Income Taxes

81.1


22.2


265.3 %







Income tax expense (benefit)

18.9


(6.2)


(404.8)%

Equity income from affiliates, net

(8.7)


(4.5)


93.3 %

Net Income

$       70.9


$       32.9


115.5 %







Earnings Per Common Share:






Basic

$       0.42


$       0.20


110.0 %

Diluted

$       0.42


$       0.20


110.0 %







Weighted Average Common Shares Outstanding:






Basic

167.7


165.5


1.3 %

Diluted

170.0


166.3


2.2 %





















Adjusted Gross Profit (1)(2)

$     464.3


$     388.9


19.4 %

Adjusted Income From Operations (1)

$     179.3


$     126.4


41.9 %

Adjusted Net Income (1)

$     122.1


$       92.1


32.6 %

Adjusted Diluted Earnings Per Share (1)

$       0.72


$       0.55


30.9 %





















Statistics (as a % of Net sales, except for income tax rate)







GAAP Three Months Ended June 30,


 Adjusted (1) Three Months Ended June 30,




2014


2013


2014


2013

Gross Profit (2)

35.2 %


31.1 %


40.9 %


37.9 %

Income From Operations

8.8 %


5.1 %


15.8 %


12.3 %

Net Income

6.2 %


3.2 %


10.8 %


9.0 %

Income Tax Rate

23.3 %


(27.9)%


28.2 %


17.1 %





















(1)

Adjusted financial measures are Non-GAAP measures and exclude specified items as described and reconciled to comparable GAAP financial measures in the Reconciliation of GAAP to Non-GAAP Financial Measures contained in this press release.

(2)

Gross profit is defined as Net sales less Cost of products sold. Adjusted gross profit excludes specified items, as indicated in the previous footnote.













 

Hospira, Inc.

Condensed Consolidated Statements of Income (Loss)

(Unaudited)

(dollars and shares in millions, except for per share amounts)
















Six Months Ended June 30,


% Change






2014


2013



Net sales

$  2,186.6


$  1,910.2


14.5 %







Cost of products sold

1,417.0


1,441.4


(1.7)%

Restructuring and impairment

14.2


11.7


21.4 %

Research and development

158.9


148.2


7.2 %

Selling, general and administrative

397.4


375.3


5.9 %

Total operating costs and expenses

1,987.5


1,976.6


0.6 %

Income (Loss) From Operations

199.1


(66.4)


399.8 %







Interest expense

39.7


39.5


0.5 %

Other (income) expense, net

(2.8)


12.4


122.6 %

Income (Loss) Before Income Taxes

162.2


(118.3)


237.1 %







Income tax expense (benefit)

35.4


(64.5)


(154.9)%

Equity income from affiliates, net

(12.0)


(10.1)


18.8 %

Net Income (Loss)

$     138.8


$      (43.7)


417.6 %







Earnings (Loss) Per Common Share:






Basic

$       0.83


$      (0.26)


419.2 %

Diluted

$       0.82


$      (0.26)


415.4 %







Weighted Average Common Shares Outstanding:






Basic

167.1


165.4


1.0 %

Diluted

169.8


165.4


2.7 %





















Adjusted Net Sales (1)(2)

$  2,186.6


$  2,014.5


8.5 %

Adjusted Gross Profit (1)(3)

$     884.2


$     748.4


18.1 %

Adjusted Income From Operations (1)

$     330.8


$     227.6


45.3 %

Adjusted Net Income (1)

$     223.8


$     178.2


25.6 %

Adjusted Diluted Earnings Per Share (1)

$       1.32


$       1.07


23.4 %





















Statistics (as a % of Net sales, except for income tax rate)








GAAP Six Months Ended June 30,


 Adjusted (1) Six Months Ended June 30,




2014


2013


2014


2013

Gross Profit (3)

35.2 %


24.5 %


40.4 %


37.2 %

Income (Loss) From Operations

9.1 %


(3.5)%


15.1 %


11.3 %

Net Income (Loss)

6.3 %


(2.3)%


10.2 %


8.8 %

Income Tax Rate

21.8 %


54.5 %


26.5 %


10.1 %





















(1)

Adjusted financial measures are Non-GAAP measures and exclude specified items as described and reconciled to comparable GAAP financial measures in the Reconciliation of GAAP to Non-GAAP Financial Measures contained in this press release.

(2)

There were no Device Strategy charges included in GAAP Net sales for the six months ended June 30, 2014.

(3)

Gross profit is defined as Net sales less Cost of products sold. Adjusted gross profit excludes specified items, as indicated in the previous footnotes.











 

Hospira, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

(dollars in millions, except for per share amounts)














Three Months Ended June 30, 2014 Reconciliation of GAAP to Non-GAAP Financial Measures:




















Gross Profit(1)


Income From

Operations


Net Income


Diluted EPS

GAAP Financial Measures


$         400.0


$        99.5


$      70.9


$       0.42

Specified Items (2)









   Device Strategy charges (A)


6.1


7.0


5.9


0.03

   Amortization of certain intangible assets (B)


17.9


17.9


12.3


0.07

   Impairment of certain assets (C)



6.1


3.8


0.02

   Certain quality and product related charges (D)


26.2


26.2


16.6


0.10

   Capacity expansion related charges (E)


14.1


14.1


9.2


0.05

   Acquisition and integration related charges (gains)(F)



1.9


(0.7)


   Facilities optimization charges (G)



5.0


3.1


0.02

   Other restructuring charges (H)



1.6


1.0


0.01

Adjusted financial measures (3)


$        464.3


$       179.3


$    122.1


0.72

















GAAP results for the three months ended June 30, 2014 include:


(A)

Device Strategy charges: $6.1 million in Cost of products sold and $0.9 million reported in Restructuring and impairment. These charges include consulting, customer accommodations, other asset impairments, accelerated depreciation, and other costs associated with Hospira's Device Strategy.


(B)

Amortization of certain intangible assets reported in Cost of products sold resulting from acquisitions including Mayne Pharma Limited ("Mayne Pharma") and a generic injectable business by Hospira Healthcare India Private Limited ("Hospira India").


(C)

Impairment of certain property and equipment assets reported in Restructuring and impairment.


(D)

Certain quality and product related charges reported in Cost of products sold primarily include third party oversight and consulting costs, extended production downtime related costs, and device product review and remediation costs to address identified issues. These charges are primarily associated with Hospira's response to the United States Food and Drug Administration ("FDA") warning letters and charges related to certain device related remediation activities.


(E)

Capacity expansion related charges reported in Cost of products sold include start-up charges related to manufacturing capacity expansion in India.


(F)

Acquisition and integration related charges (gains): $1.9 million reported in Selling, general, and administrative and ($3.1) million reported in Other (income) expense, net. These amounts include costs for the acquisition and integration and foreign exchange hedge gains of an active pharmaceutical ingredient business.


(G)

Facilities optimization charges reported in Restructuring and impairment related to the sale of the Buffalo, NY, manufacturing facility.


(H)

Other restructuring charges reported in Restructuring and impairment. These charges include severance charges associated with Hospira's commercial reorganization.

 





Three Months Ended June 30, 2013 Reconciliation of GAAP to Non-GAAP Financial Measures:




















Gross Profit(1)


Income From

Operations


Net Income


Diluted EPS

GAAP Financial Measures


$           318.7


$           52.2


$         32.9


$          0.20

   Specified Items (2)









   Device Strategy charges (A)


14.6


17.0


11.6


0.07

   Amortization of certain intangible assets (B)


17.6


17.6


12.2


0.07

   Impairment of certain assets (C)




9.1


0.05

   Certain quality and product related charges (D)


34.0


34.0


22.6


0.14

   Capacity expansion related charges (E)


4.0


4.0


2.6


0.02

   Acquisition and integration related charges (F)



1.1


0.7


   Other restructuring charges (G)



0.5


0.4


Adjusted financial measures (3)


$           388.9


$          126.4


$         92.1


$          0.55




















GAAP results for the three months ended June 30, 2013 include:


(A)

Device Strategy charges: $14.6 million in Cost of products sold, and $2.4 million reported in Restructuring and impairment. These charges include device related customer accommodations, other asset impairments, accelerated depreciation, consulting and other costs associated with Hospira's Device Strategy.


(B)

Amortization of certain intangible assets reported in Cost of products sold resulting from acquisitions including Mayne Pharma and a generic injectable business by Hospira India.


(C)

Impairment of certain investment assets: $9.3 million reported in Other (income) expense, net.


(D)

Certain quality and product related charges reported in Cost of products sold primarily include third party oversight and consulting costs, and device product review and remediation costs to address identified issues. These charges are primarily associated with Hospira's response to the FDA warning letters and charges related to certain device related remediation activities.


(E)

Capacity expansion related charges reported in Cost of products sold include start-up charges related to manufacturing capacity expansion in India.


(F)

Acquisition and integration related charges reported in Selling, general, and administrative include costs for the then pending acquisition and integration of an active pharmaceutical ingredient business.


(G)

Other restructuring charges reported in Restructuring and impairment. These charges include severance charges associated with Hospira's commercial reorganization.

(1)

Gross profit is defined as Net sales less Cost of products sold.

(2)

Specified items are shown net of tax in aggregate of $25.5 million and $24.3 million for the three months ended June 30, 2014 and 2013, respectively, based on the statutory tax rates in the various tax jurisdictions in which the items occurred.

(3)

The Non-GAAP financial measures contained in this press release (including adjusted gross profit, adjusted income from operations, adjusted net income and adjusted diluted Earnings Per Share) adjust for specified items. Management believes the Non-GAAP financial measures represent the amounts directly related to the ongoing operations of the business and uses these measures in evaluating performance. All Non-GAAP financial measures are intended to supplement the applicable GAAP measures and should not be considered in isolation from, or a replacement for, financial measures prepared in accordance with GAAP and may not be comparable to, or calculated in the same manner as, Non-GAAP financial measures published by other companies. Refer to Hospira's Form 8-K furnished on July 30, 2014.

 

Hospira, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

(dollars in millions, except for per share amounts)
















Six Months Ended June 30, 2014 Reconciliation of GAAP to Non-GAAP Financial Measures:
























Gross Profit(1)


Income From

Operations


Net Income


Diluted EPS

GAAP Financial Measures


$        769.6


$                199.1


$              138.8


$       0.82

Specified Items (2)









Device Strategy charges (A)


12.0


13.3


10.5


$       0.06

Amortization of certain intangible assets (B)


35.4


35.4


24.6


$       0.14

Impairment of certain assets (C)



6.1


3.8


$       0.02

Certain quality and product related charges (D)


39.1


39.1


25.1


$       0.15

Capacity expansion related charges (E)


28.1


28.1


18.5


$       0.11

Acquisition and integration related charges (gains) (F)



2.8


(1.8)


$      (0.01)

Facilities optimization charges (G)



5.0


3.1


$       0.02

Other restructuring charges (H)



1.9


1.2


$       0.01

Adjusted financial measures (3)


$        884.2


$                330.8


$              223.8


$       1.32



















GAAP results for the six months ended June 30, 2014 include:


(A)

Device Strategy charges: $12.0 million in Cost of products sold and $1.3 million in Restructuring and impairment. These charges include consulting, customer accommodations, collection and destruction costs, accelerated depreciation, and other costs associated with Hospira's Device Strategy.


(B)

Amortization of certain intangible assets reported in Cost of products sold resulting from acquisitions including Mayne Pharma and a generic injectable business by Hospira India.


(C)

Impairments of certain property and equipment assets reported in Restructuring and impairment.


(D)

Certain quality and product related charges reported  in Cost of products sold primarily include third party oversight and consulting costs, extended production downtime related costs, and device product review and remediation costs to address identified issues. These charges are primarily associated with Hospira's response to the FDA warning letters and charges related to certain device related remediation activities.


(E)

Capacity expansion related charges reported in Cost of products sold include start-up charges related to manufacturing capacity expansion in India.


(F)

Acquisition and integration related charges (gains): $2.8 million reported in Selling, general, and administrative and $(5.8) million reported in Other (income) expense, net. These amounts include costs for the acquisition and integration and foreign exchange hedge gains of an active pharmaceutical ingredient business.


(G)

Facilities optimization charges reported in Restructuring and impairment related to the sale of the Buffalo, NY, manufacturing facility.


(H)

Other restructuring charges reported in Restructuring and impairment. These charges include severance costs associated with Hospira's commercial reorganization.



 

Six Months Ended June 30, 2013 Reconciliation of GAAP to Non-GAAP Financial Measures:






















Net Sales


Gross Profit(1)


(Loss) Income From

Operations


Net (Loss) Income


Diluted EPS

GAAP Financial Measures


$               1,910.2


$        468.8


$                (66.4)


$               (43.7)


$      (0.26)

Specified Items (2)











Device Strategy charges (A)


104.3


191.4


198.5


145.9


0.88

Amortization of certain intangible assets (B)



35.8


35.8


24.9


0.15

Impairment of certain assets (C)





11.1


0.06

Certain quality and product related charges (D)



44.7


44.7


30.0


0.18

Capacity expansion related charges (E)



7.7


7.7


5.0


0.03

Acquisition and integration related charges (F)




2.8


1.8


0.01

Other restructuring charges (G)




4.5


3.2


0.02

Adjusted financial measures (3)


$               2,014.5


$        748.4


$                227.6


$              178.2


$       1.07




























GAAP results for the six months ended June 30, 2013 include:


(A)

Device Strategy charges: $104.3 million reported in Net sales, $87.1 million in Cost of products sold and $7.1 million in Restructuring and impairment. These charges include device related customer sales allowances, customer accommodations, contract termination, collection and destruction costs, inventory charges, other asset impairments, accelerated depreciation, consulting and other costs associated with Hospira's Device Strategy.


(B)

Amortization of certain intangible assets reported in Cost of products sold resulting from acquisitions including Mayne Pharma and a generic injectable business by Hospira India.


(C)

Impairment of certain investment assets: $11.3 million reported in Other (income) expense, net.


(D)

Certain quality and product related charges reported in Cost of products sold primarily include third party oversight and consulting costs, and device product review and remediation costs to address identified issues. These charges are primarily associated with Hospira's response to the FDA warning letters and charges related to certain device related remediation activities.


(E)

Capacity expansion related charges reported in Cost of products sold include start-up charges related to manufacturing capacity expansion in India.


(F)

Acquisition and integration related charges reported in Selling, general, and administrative include costs for the then pending acquisition and integration of an active pharmaceutical ingredient business.


(G)

Other restructuring charges reported in Restructuring and impairment. These charges include severance charges associated with Hospira's commercial reorganization.

(1)

Gross profit is defined as Net sales less Cost of products sold.

(2)

Specified items are shown net of tax in aggregate of $40.9 million and $83.4 million for the six months ended June 30, 2014 and 2013, respectively, based on the statutory tax rates in the various tax jurisdictions in which the items occurred.

(3)

The Non-GAAP financial measures contained in this press release (including adjusted net sales, adjusted gross profit, adjusted income from operations, adjusted net income and adjusted diluted Earnings Per Share) adjust for specified items. Management believes the Non-GAAP financial measures represent the amounts directly related to the ongoing operations of the business and uses these measures in evaluating performance. All Non-GAAP financial measures are intended to supplement the applicable GAAP measures and should not be considered in isolation from, or a replacement for, financial measures prepared in accordance with GAAP, and may not be comparable to, or calculated in the same manner as, Non-GAAP financial measures published by other companies.  Refer to Hospira's Form 8-K furnished on July 30, 2014.

 

Hospira, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(dollars in millions)




























June 30,


December 31,








2014


2013

Assets










Current Assets:





Cash and cash equivalents


$     796.5


$        798.1

Trade receivables, less allowances of $12.3 and $11.2, respectively


649.5


574.3

Inventories, net


1,167.8


1,066.2

Deferred income taxes and other


222.0


208.6

Prepaid expenses


81.8


90.0

Other receivables


143.1


101.3

Total Current Assets


3,060.7


2,838.5

Property and equipment, net


1,655.6


1,574.2

Intangible assets, net


139.3


172.2

Goodwill


1,070.9


1,057.7

Deferred income taxes


296.7


358.9

Investments


44.3


33.1

Other assets


134.3


144.3

Total Assets


$  6,401.8


$     6,178.9

Liabilities and Shareholders' Equity










Current Liabilities:





Short-term borrowings


$       19.9


$          93.7

Trade accounts payable


349.2


329.2

Salaries, wages and commissions


183.1


185.4

Other accrued liabilities


639.3


556.8

Total Current Liabilities


1,191.5


1,165.1

Long-term debt


1,748.9


1,747.0

Deferred income taxes


6.8


3.2

Post-retirement obligations and other long-term liabilities


204.0


301.7

Commitments and Contingencies





Total Shareholders' Equity


3,250.6


2,961.9

Total Liabilities and Shareholders' Equity


$  6,401.8


$     6,178.9

 

Hospira, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(dollars in millions)








Six Months Ended June 30,

Cash Flow From Operating Activities:


2014


2013

Net Income (Loss)


$    138.8


$        (43.7)

Adjustments to reconcile Net Income (Loss) to net cash from operating activities-





Depreciation


87.1


84.7

Amortization of intangible assets


43.9


43.5

Stock-based compensation expense


28.7


20.7

Undistributed equity income from affiliates


(12.0)


(10.1)

Distributions received from equity affiliates



30.1

Deferred income taxes and other tax adjustments


32.7


(59.2)

Impairments and other asset charges


7.3


64.8

Loss on disposal of assets


5.0


Changes in assets and liabilities-





Trade receivables


(71.9)


(34.6)

Inventories


(96.1)


(110.0)

Prepaid expenses and other assets


(22.0)


(49.7)

Trade accounts payable


27.1


3.4

Other liabilities


(2.3)


101.7

Other, net


9.2


9.0

Net Cash Provided by Operating Activities


175.5


50.6






Cash Flow From Investing Activities:





Capital expenditures (including instruments placed with or leased to customers)


(184.8)


(152.7)

Acquisition, net of cash acquired


(9.0)


Purchases of intangibles and other investments


(4.3)


(9.9)

Proceeds from disposal of businesses and assets


16.9


1.4

Net Cash Used in Investing Activities


(181.2)


(161.2)






Cash Flow From Financing Activities:





Other borrowings, net


(77.2)


32.4

Excess tax benefit from stock-based compensation arrangements


2.6


0.5

Proceeds from stock options exercised


78.0


6.1

Net Cash Provided by Financing Activities


3.4


39.0






Effect of exchange rate changes on cash and cash equivalents


0.7


(17.3)






Net change in cash and cash equivalents


(1.6)


(88.9)

Cash and cash equivalents at beginning of period


798.1


772.1

Cash and cash equivalents at end of period


$    796.5


$       683.2






Supplemental Cash Flow Information:





Cash paid during the period-





Interest


$      51.1


$         51.4

Income taxes, net of refunds


$        8.8


$         19.4

Accrued capital expenditures


$      25.7


$         18.4

 











Hospira, Inc.


Net Sales by Product Line


(Unaudited)


(dollars in millions)
























Three Months Ended June 30,




2014


2013


% Change at

Actual Currency

Rates


% Change at

Constant Currency

Rates(1)


Americas—









   Specialty Injectable Pharmaceuticals

$     625.5


$     539.3


16.0 %


16.7 %


   Medication Management

176.2


176.5


(0.2)%


1.4 %


   Other Pharma

111.5


100.4


11.1 %


11.4 %


Total Americas

913.2


816.2


11.9 %


12.7 %











Europe, Middle East & Africa ("EMEA")—









   Specialty Injectable Pharmaceuticals

84.6


82.0


3.2 %


(1.6)%


   Medication Management

27.9


27.0


3.3 %


(1.9)%


   Other Pharma

20.2


20.3


(0.5)%


(7.9)%


Total EMEA

132.7


129.3


2.6 %


(2.6)%











Asia Pacific ("APAC")—









   Specialty Injectable Pharmaceuticals

75.2


68.5


9.8 %


13.3 %


   Medication Management

11.4


10.5


8.6 %


11.4 %


   Other Pharma

3.3


1.7


94.1 %


94.1 %


Total APAC

89.9


80.7


11.4 %


14.7 %











Net Sales

$  1,135.8


$  1,026.2


10.7 %


11.0 %











Global—









   Specialty Injectable Pharmaceuticals

$     785.3


$     689.8


13.8 %


14.2 %


   Medication Management

215.5


214.0


0.7 %


1.4 %


   Other Pharma

135.0


122.4


10.3 %


9.3 %


Net Sales

$  1,135.8


$  1,026.2


10.7 %


11.0 %


































(1)

The Non-GAAP financial measures contained in this press release include comparisons at constant currency rates, which reflect comparative local currency balances at prior period foreign exchange rates. Hospira calculated these percentages by taking current period reported net sales less the respective prior period reported net sales, divided by the prior period reported net sales, all at the respective prior period's foreign exchange rates. This measure provides information on the change in net sales assuming that foreign currency exchange rates have not changed between the prior and the current period. Management believes the use of this measure aids in the understanding of our change in net sales without the impact of foreign currency and provides greater transparency into Hospira's results of operations.

 

Hospira, Inc.

Net Sales by Product Line

(Unaudited)

(dollars in millions)



















Six Months Ended June 30,









Reported


Adjusted(1)(3)



GAAP Net Sales

2014


GAAP Net Sales

2013


Adjusted Net

Sales 2013(1)(3)


% Change at

Actual Currency

Rates


% Change at

Constant Currency

Rates(2)


% Change at

Actual Currency

Rates


% Change at

Constant Currency

Rates(2)

Americas—














   Specialty Injectable Pharmaceuticals

$  1,196.1


$  1,050.4


$       1,050.4


13.9 %


14.8 %


13.9 %


14.8 %

   Medication Management

346.8


275.2


363.6


26.0 %


28.3 %


(4.6)%


(2.9)%

   Other Pharma

212.1


189.0


189.0


12.2 %


12.7 %


12.2 %


12.7 %

Total Americas

1,755.0


1,514.6


1,603.0


15.9 %


17.0 %


9.5 %


10.6 %















EMEA—














   Specialty Injectable Pharmaceuticals

170.5


164.4


164.4


3.7 %


(0.6)%


3.7 %


(0.6)%

   Medication Management

53.6


45.3


58.5


18.3 %


13.2 %


(8.4)%


(12.3)%

   Other Pharma

41.4


36.8


36.8


12.5 %


6.3 %


12.5 %


6.3 %

Total EMEA

265.5


246.5


259.7


7.7 %


3.0 %


2.2 %


(2.3)%















APAC—














   Specialty Injectable Pharmaceuticals

135.0


126.8


126.8


6.5 %


12.1 %


6.5 %


12.1 %

   Medication Management

21.4


17.8


20.5


20.2 %


26.4 %


4.4 %


9.8 %

   Other Pharma

9.7


4.5


4.5


115.6 %


115.6 %


115.6 %


115.6 %

Total APAC

166.1


149.1


151.8


11.4 %


17.0 %


9.4 %


15.0 %















Net Sales

$  2,186.6


$  1,910.2


$       2,014.5


14.5 %


15.2 %


8.5 %


9.2 %















Global—














   Specialty Injectable Pharmaceuticals

$  1,501.6


$  1,341.6


$       1,341.6


11.9 %


12.7 %


11.9 %


12.7 %

   Medication Management

421.8


338.3


442.6


24.7 %


26.2 %


(4.7)%


(3.5)%

   Other Pharma

263.2


230.3


230.3


14.3 %


13.7 %


14.3 %


13.7 %

Net Sales

$  2,186.6


$  1,910.2


$       2,014.5


14.5 %


15.2 %


8.5 %


9.2 %
















































(1)

Adjusted Net sales for the six months ended June 30, 2013 excludes charges of $104.3 million related to the Device Strategy. The Device Strategy charges are reported in the respective Medication Management Net sales by product line as follows: Americas-$88.4 million, EMEA-$13.2 million and APAC-$2.7 million. There were no Device Strategy charges included in GAAP Net sales for the six months ended June 30, 2014.

(2)

The Non-GAAP financial measures contained in this press release include comparisons at constant currency rates, which reflect comparative local currency balances at prior period foreign exchange rates. Hospira calculated these percentages by taking current period reported net sales less the respective prior period reported net sales, divided by the prior period reported net sales, all at the respective prior period's foreign exchange rates. This measure provides information on the change in net sales assuming that foreign currency exchange rates have not changed between the prior and the current period. Management believes the use of this measure aids in the understanding of our change in net sales without the impact of foreign currency and provides greater transparency into Hospira's results of operations.

(3)

Adjusted financial measures exclude specified items as described and reconciled to comparable GAAP financial measures in the Reconciliation of GAAP to Non-GAAP Financial Measures contained in this press release.

 

SOURCE Hospira, Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Qosmos has announced new milestones in the detection of encrypted traffic and in protocol signature coverage. Qosmos latest software can accurately classify traffic encrypted with SSL/TLS (e.g., Google, Facebook, WhatsApp), P2P traffic (e.g., BitTorrent, MuTorrent, Vuze), and Skype, while preserving the privacy of communication content. These new classification techniques mean that traffic optimization, policy enforcement, and user experience are largely unaffected by encryption. In respect wit...
While DevOps promises a better and tighter integration among an organization’s development and operation teams and transforms an application life cycle into a continual deployment, Chef and Azure together provides a speedy, cost-effective and highly scalable vehicle for realizing the business values of this transformation. In his session at @DevOpsSummit at 19th Cloud Expo, Yung Chou, a Technology Evangelist at Microsoft, will present a unique opportunity to witness how Chef and Azure work tog...
The Internet of Things can drive efficiency for airlines and airports. In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect with GE, and Sudip Majumder, senior director of development at Oracle, will discuss the technical details of the connected airline baggage and related social media solutions. These IoT applications will enhance travelers' journey experience and drive efficiency for the airlines and the airports. The session will include a working demo and a technical d...
SYS-CON Events announced today that Isomorphic Software will exhibit at DevOps Summit at 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Isomorphic Software provides the SmartClient HTML5/AJAX platform, the most advanced technology for building rich, cutting-edge enterprise web applications for desktop and mobile. SmartClient combines the productivity and performance of traditional desktop software with the simp...
Between the mockups and specs produced by analysts, and resulting applications built by developers, there exists a gulf where projects fail, costs spiral, and applications disappoint. Methodologies like Agile attempt to address this with intensified communication, with partial success but many limitations. In his session at @DevOpsSummit at 19th Cloud Expo, Charles Kendrick, CTO at Isomorphic Software, will present a revolutionary model enabled by new technologies. Learn how business and deve...
DevOps at Cloud Expo – being held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA – announces that its Call for Papers is open. Born out of proven success in agile development, cloud computing, and process automation, DevOps is a macro trend you cannot afford to miss. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the world's largest enterprises – and delivering real results. Am...
Although it has gained significant traction in the consumer space, IoT is still in the early stages of adoption in enterprises environments. However, many companies are working on initiatives like Industry 4.0 that includes IoT as one of the key disruptive technologies expected to reshape businesses of tomorrow. The key challenges will be availability, robustness and reliability of networks that connect devices in a business environment. Software Defined Wide Area Network (SD-WAN) is expected to...
Developing software for the Internet of Things (IoT) comes with its own set of challenges. Security, privacy, and unified standards are a few key issues. In addition, each IoT product is comprised of (at least) three separate application components: the software embedded in the device, the back-end service, and the mobile application for the end user’s controls. Each component is developed by a different team, using different technologies and practices, and deployed to a different stack/target –...
SYS-CON Events announced today that Hitrons Solutions will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Hitrons Solutions Inc. is distributor in the North American market for unique products and services of small and medium-size businesses, including cloud services and solutions, SEO marketing platforms, and mobile applications.
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 19th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devices - comp...
SYS-CON Events announced today that Numerex Corp, a leading provider of managed enterprise solutions enabling the Internet of Things (IoT), will exhibit at the 19th International Cloud Expo | @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Numerex Corp. (NASDAQ:NMRX) is a leading provider of managed enterprise solutions enabling the Internet of Things (IoT). The Company's solutions produce new revenue streams or create operating...
Enterprises have forever faced challenges surrounding the sharing of their intellectual property. Emerging cloud adoption has made it more compelling for enterprises to digitize their content, making them available over a wide variety of devices across the Internet. In his session at 19th Cloud Expo, Santosh Ahuja, Director of Architecture at Impiger Technologies, will introduce various mechanisms provided by cloud service providers today to manage and share digital content in a secure manner....
We are always online. We access our data, our finances, work, and various services on the Internet. But we live in a congested world of information in which the roads were built two decades ago. The quest for better, faster Internet routing has been around for a decade, but nobody solved this problem. We’ve seen band aid approaches like CDNs that attack a niche's slice of static content part of the Internet, but that’s it. It does not address the dynamic services-based Internet of today. It doe...
As the world moves toward more DevOps and Microservices, application deployment to the cloud ought to become a lot simpler. The Microservices architecture, which is the basis of many new age distributed systems such as OpenStack, NetFlix and so on, is at the heart of Cloud Foundry - a complete developer-oriented Platform as a Service (PaaS) that is IaaS agnostic and supports vCloud, OpenStack and AWS. Serverless computing is revolutionizing computing. In his session at 19th Cloud Expo, Raghav...
As cloud adoption continues to transform business, today’s global enterprises are challenged with managing a growing amount of information living outside of the data center. The rapid adoption of IoT and increasingly mobile workforce are exacerbating the problem. Ensuring secure data sharing and efficient backup poses capacity and bandwidth considerations as well as policy and regulatory compliance issues.