ABBOTT PARK, Ill., Jan. 28, 2016 /PRNewswire/ -- Abbott (NYSE: ABT) today announced financial results for the fourth quarter ended Dec. 31, 2015.

• Adjusted diluted EPS from continuing operations, which excludes specified items, was $0.62 in the fourth quarter and $2.15 for the full year, at the midpoint of Abbott's previous guidance range and reflecting 8.6 percent growth for the full year. Reported diluted EPS from continuing operations under GAAP was $0.46 in the fourth quarter and $1.72 for the full year.
• Fourth-quarter worldwide sales of $5.2 billion increased 4.9 percent on an operational basis and decreased 3.1 percent on a reported basis.
• Full-year sales increased 9.1 percent on an operational basis and 0.8 percent on a reported basis. Full-year sales in emerging markets increased double digits excluding the impact of 2014 acquisitions and foreign exchange.
• For the full year 2015, Abbott expanded its adjusted gross and operating margin ratios by 260 and 90 basis points over the prior year, respectively. The gross and operating margin ratios under GAAP improved by 250 and 120 basis points over the prior year, respectively.
• Abbott issues full-year 2016 adjusted EPS guidance range of $2.10 to $2.20. Projected full-year 2016 EPS under GAAP is $1.55 to $1.65. Abbott's 2016 forecast assumes a significantly lower contribution from Venezuelan operations as a result of challenging market conditions in that country. Excluding the impact of foreign exchange and Venezuela, the midpoint of Abbott's 2016 adjusted EPS guidance range would reflect strong double-digit growth.

"In 2015, we achieved top-tier sales and earnings growth despite a challenging currency environment," said Miles D. White, chairman and chief executive officer, Abbott. "Our underlying performance continues to be strong."

FOURTH-QUARTER BUSINESS OVERVIEW

Note: Prior year financial results have been adjusted to exclude the sales from Abbott's developed markets branded generics pharmaceuticals and animal health businesses that were sold to Mylan and Zoetis, respectively, in the first quarter 2015. Therefore, sales and growth rates shown in the following charts represent continuing operations.

Following are sales by business segment and commentary for the fourth quarter and the full year:

Total Company
($ in millions)

Fourth-quarter 2015 worldwide sales of $5.2 billion increased 4.9 percent on an operational basis and decreased 3.1 percent on a reported basis, including an unfavorable 8.0 percent effect of foreign exchange.

International sales increased 5.6 percent on an operational basis and decreased 5.7 percent on a reported basis in the fourth quarter.

Full-year 2015 worldwide sales of $20.4 billion increased 9.1 percent on an operational basis and 0.8 percent on a reported basis, including an unfavorable 8.3 percent effect of foreign exchange. Full-year sales in emerging markets increased double digits excluding the impact of 2014 acquisitions and foreign exchange, driven by double-digit growth in Established Pharmaceuticals, Diagnostics and Nutrition.

Nutrition
($ in millions)         

Worldwide Nutrition sales increased 5.5 percent in the fourth quarter on an operational basis and decreased 0.2 percent on a reported basis, including an unfavorable 5.7 percent effect of foreign exchange.

Worldwide Pediatric Nutrition sales increased 3.7 percent on an operational basis and decreased 1.3 percent on a reported basis in the quarter, including an unfavorable 5.0 percent effect of foreign exchange. In the U.S., sales growth in the quarter was led by continued consumer uptake of several recently launched non-GMO products. International growth was led by share expansion of Eleva^TM in the premium segment of the Chinese market and double-digit operational growth across several Latin American countries, partially offset by a difficult comparison to the fourth quarter 2014, when sales increased strong double digits.

Worldwide Adult Nutrition sales increased 7.9 percent on an operational basis and 1.3 percent on a reported basis in the quarter, including an unfavorable 6.6 percent effect of foreign exchange. International growth was led by continued category expansion in Latin America and other priority international markets. U.S. adult nutrition sales increased 4.8 percent led by growth of Ensure^® in the retail and institutional segments of the market.   

Diagnostics
($ in millions)

Worldwide Diagnostics sales increased 7.0 percent in the fourth quarter on an operational basis, driven by continued above-market growth in both emerging and developed markets. Sales decreased 1.1 percent on a reported basis, including an unfavorable 8.1 percent effect of foreign exchange.

Core Laboratory Diagnostics sales increased 7.4 percent in the quarter on an operational basis and decreased 1.8 percent on a reported basis, including an unfavorable 9.2 percent effect of foreign exchange. Operational sales growth in the quarter was driven by double-digit growth in emerging markets and continued share gains in the U.S. and internationally.

Molecular Diagnostics sales increased 2.6 percent in the quarter on an operational basis and decreased 3.9 percent on a reported basis, including an unfavorable 6.5 percent effect of foreign exchange. Strong growth in the infectious disease testing business, which remains Abbott's core focus area in Molecular Diagnostics, led operational growth in the quarter. As expected, U.S. growth was impacted by the planned scale down of the genetics business.

Point of Care Diagnostics sales increased 8.6 percent in the quarter on an operational basis as this business continues to expand its product offering and geographic presence in targeted developed and emerging markets. Sales increased 7.3 percent on a reported basis, including an unfavorable 1.3 percent effect of foreign exchange.

Established Pharmaceuticals
($ in millions)

Note: Prior year financial results have been adjusted to exclude the sales from the developed markets branded generics pharmaceuticals business, which was sold to Mylan on Feb. 27, 2015. Therefore, sales and growth rates shown in the following charts represent continuing operations.

Established Pharmaceuticals sales increased 10.9 percent in the fourth quarter on an operational basis and decreased 4.0 percent on a reported basis, including an unfavorable 14.9 percent effect of foreign exchange.

Sales in Key Emerging Markets increased 12.1 percent on an operational basis, driven by continued double-digit growth in India, China, and Russia. Sales decreased 4.3 percent on a reported basis, including an unfavorable 16.4 percent effect of foreign exchange.

For the full year 2015, Established Pharmaceutical sales increased double digits excluding the impact of acquisitions and foreign exchange. Growth was driven by commercial initiatives and locally-relevant portfolio expansion in key geographies.

During the year, Abbott successfully integrated the acquisitions of CFR Pharmaceuticals in Latin America and Veropharm in Russia. These businesses strengthened Abbott's capabilities, relevant product portfolios, and leadership in key geographies. 

Medical Devices
($ in millions)

Worldwide Medical Devices sales increased 0.7 percent in the fourth quarter on an operational basis and decreased 5.9 percent on a reported basis, including an unfavorable 6.6 percent effect of foreign exchange.

Worldwide sales of Vascular products decreased 0.5 percent in the quarter on an operational basis and 7.0 percent on a reported basis, including an unfavorable 6.5 percent effect of foreign exchange. Sales of Abbott's MitraClip^® device for the treatment of mitral regurgitation increased double digits globally, as Abbott continues to build the market for this first-in-class device. In October, at the Transcatheter Cardiovascular Therapeutics conference, Abbott presented trial results for Absorb^TM, its first-of-its-kind fully dissolving stent, showing comparable outcomes to XIENCE^TM, its highly successful drug-eluting stent. In 2015, Abbott completed submissions for regulatory approval of Absorb in Japan and the U.S.

Worldwide Diabetes Care sales increased 2.4 percent in the quarter on an operational basis and decreased 5.2 percent on a reported basis, including an unfavorable 7.6 percent effect of foreign exchange.  Internationally, operational sales growth was driven by continued uptake of Abbott's FreeStyle^® Libre Flash Glucose Monitoring System. Abbott recently completed a significant expansion of its manufacturing capacity for FreeStyle Libre to meet strong customer demand.

Worldwide Medical Optics sales increased 1.9 percent in the quarter on an operational basis and decreased 4.1 percent on a reported basis, including an unfavorable 6.0 percent effect of foreign exchange. Operational sales growth was driven by uptake of new cataract products in the premium intraocular lens segment. This growth was partially offset by market dynamics in the refractive business.

ABBOTT ISSUES EARNINGS-PER-SHARE OUTLOOK FOR 2016

Abbott is issuing full-year 2016 guidance for earnings per share, excluding specified items, of $2.10 to $2.20. Abbott's 2016 forecast assumes a significantly lower contribution from Venezuelan operations as a result of challenging market conditions in that country. Excluding the impact of foreign exchange and Venezuela, the midpoint of Abbott's 2016 adjusted EPS guidance range would reflect strong double-digit growth. 

Abbott forecasts net specified items for the full year 2016 of approximately $0.55 per share.  Specified items include intangible amortization expense, charges associated with cost reduction initiatives and deal and other expenses.

Including net specified items, projected earnings per share under Generally Accepted Accounting Principles (GAAP) would be $1.55 to $1.65 for the full year 2016.

Abbott is issuing first-quarter 2016 guidance for earnings per share, excluding specified items, of $0.38 to $0.40.  Abbott forecasts specified items for the first quarter 2016 of $0.15 related to the same items discussed above for the full year 2016.  Including specified items, projected earnings per share under GAAP would be $0.23 to $0.25 for the first quarter.

ABBOTT ANNOUNCES INCREASE IN QUARTERLY DIVIDEND

On Dec. 11, 2015, the board of directors of Abbott increased the company's quarterly dividend to $0.26 per share from $0.24 per share. Abbott's cash dividend is payable Feb. 16, 2016, to shareholders of record at the close of business on Jan. 15, 2016. This marks the 368^th consecutive quarterly dividend paid by Abbott.

Abbott is a member of the S&P 500 Dividend Aristocrats Index, which tracks companies that have annually increased their dividend for 25 consecutive years.

About Abbott:

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 74,000 people.

Visit Abbott at www.abbott.com and connect with us on Twitter at @AbbottNews.

Abbott will webcast its live fourth-quarter earnings conference call through its Investor Relations website at www.abbottinvestor.com at 8 a.m. Central time today. An archived edition of the call will be available after 11 a.m. Central time.

- Private Securities Litigation Reform Act of 1995 -

A Caution Concerning Forward-Looking Statements

Some statements in this news release may be forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Abbott cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in the forward-looking statements. Economic, competitive, governmental, technological and other factors that may affect Abbott's operations are discussed in Item 1A, "Risk Factors,'' to our Annual Report on Securities and Exchange Commission Form 10-K for the year ended Dec. 31, 2014, and are incorporated by reference. Abbott undertakes no obligation to release publicly any revisions to forward-looking statements as a result of subsequent events or developments, except as required by law.

Specified items reflect intangible amortization expense of $143 million and other expenses of $162 million, primarily associated with cost reduction initiatives and acquisitions.

Specified items reflect intangible amortization expense of $163 million and other expenses of $152 million, primarily associated with cost reduction initiatives and deal and other expenses related to acquisitions, as well as tax expense of $175 million associated with a one-time repatriation of 2014 ex-U.S. earnings, partially offset by favorability as a result of the resolution of various tax positions and adjustment of tax uncertainties from prior years.  

Specified items reflect intangible amortization expense of $601 million and other expenses of $510 million, primarily associated with cost reduction initiatives and acquisitions, partially offset by a gain on the sale of a portion of Abbott's position in Mylan stock of $207 million and a decrease in the fair value of contingent consideration related to a business acquisition.

Specified items reflect intangible amortization expense of $555 million and other expenses of $632 million, primarily associated with cost reduction initiatives and deal and other expenses related to acquisitions, as well as tax expense of $440 million associated with a one-time repatriation of 2014 ex-U.S. earnings, partially offset by favorability as a result of the resolution of various tax positions and adjustment of tax uncertainties from prior years.  

RECONCILIATION OF TAX RATE FOR CONTINUING OPERATIONS

A reconciliation of the fourth-quarter tax rates for continuing operations for 2015 and 2014 is shown below:

A reconciliation of the full-year tax rates for continuing operations for 2015 and 2014 is shown below:

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