Under this method, entities recognize the cumulative effect of applying the new standard at the date of initial application with no restatement of comparative periods presented. For intercompany and trade payables and receivables, the currency exposures are primarily the U.S. dollar and European currencies. Reflects net expense for the estimated tax impact of the TCJA, the net tax benefit associated with the specified items and excess tax benefits associated with share-based compensation. Powered by Madgex Job Board Software. Product warranties are also not significant. For the three months ended March 31, 2017, AMO’s losses before taxes were $18 million. The provisional estimate of the impact of U.S. tax reform was based on Abbott's initial analysis of the TCJA. Specified items include intangible amortization expense, acquisition-related expenses, charges associated with cost reduction initiatives and other expenses. Restructuring and cost reduction plans consist of distinct initiatives to streamline operations including the consolidation and rationalization of business activities and facilities, workforce reductions, the transfer of product lines between manufacturing facilities, and the transfer of other business activities between sites. The combined business competes in nearly every area of the cardiovascular device market, as well as in the neuromodulation market. Issued at stated capital amount - Shares: 2018: 1,969,331,007; 2017: 1,965,908,188, Common shares held in treasury, at cost - Shares: 2018: 216,143,241; 2017: 222,305,719. Note 14 — Litigation and Environmental Matters. Unrealized Gains This accrual represents management’s best estimate of probable loss, as defined by FASB ASC No. For the full-year 2018, Other sales increased 8.1 percent on a reported basis and 5.8 percent on an organic basis. Net cost recognized in continuing operations for the three months ended March 31 for Abbott’s major defined benefit plans and post-employment medical and dental benefit plans is as follows: Service cost - benefits earned during the period, Interest cost on projected benefit obligations. Restructuring and cost reduction plans consist of distinct initiatives to streamline operations including the consolidation and rationalization of business activities and facilities, workforce reductions, the transfer of product lines between manufacturing facilities, and the transfer of other business activities between sites. Abbott Laboratories and Subsidiaries Condensed Consolidated Statement of Earnings First Quarter Ended March 31, 2018 and 2017 (in millions, except per share data) (unaudited) 1Q18 1Q17 % … At an Abbott stock price of $39.36, which reflects the closing price on January 4, 2017, this represented a value of approximately $81 per St. Jude Medical common share and total purchase consideration of $23.6 billion. Approximately $10 million is recorded in Cost of products sold, approximately $8 million is recognized in Research and development and approximately $15 million is recognized in Selling, general and administrative expense. Item 1. Reported tax rate on a GAAP basis for 2017 includes the estimated net impact of U.S. tax reform of $1.46 billion, the impact of taxes associated with a $1.163 billion pretax gain on the sale of the AMO business and the impact of approximately $120 million in excess tax benefits associated with share-based compensation. Abbott adopted the standard in the first quarter of 2018 and the Condensed Consolidated Statement of Earnings was retrospectively adjusted, resulting in the reclassification of $40 million of income from Operating earnings (loss) to Other (income) expense, net in the first quarter of 2017. In September 2014, the board of directors authorized the repurchase of up to $3.0 billion of Abbott’s common shares from time to time. Revenue from Contracts with Customers "We exceeded the organic sales growth range we set at the beginning of the year, achieved a number of significant advances in our pipeline, and significantly improved our balance sheet and strategic flexibility. ). Upfront commission fees paid to sales personnel as a result of obtaining or renewing contracts with customers are incremental to obtaining the contract. View original content:http://www.prnewswire.com/news-releases/abbott-reports-2018-results-and-issues-strong-forecast-for-2019-300782771.html, © 1985 - 2020 BioSpace.com. Excluding the effect of foreign exchange, the 53.8 percent increase in Diagnostics sales was primarily driven by Alere which was acquired in the fourth quarter of 2017. The following table summarizes the bases used to measure certain assets and liabilities at fair value on a recurring basis in the balance sheet: Quoted See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Abbott expects to maintain an investment grade rating. Other, net in Net cash from operating activities for the first three months of 2017 of $101 million includes the impact of approximately $430 million of tax associated with the disposition of businesses, partially offset by approximately $160 million of cash taxes paid. In October 2016, the FASB issued ASU 2016-16,  On January 1, 2013, Abbott completed the separation of AbbVie Inc. (AbbVie), which was formed to hold Abbott’s research-based proprietary pharmaceuticals business. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c) Remaining costs, if any, are not allocated to segments. TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934, For the transition period from             to, Indicate by check mark whether the registrant: (l) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of l934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Item 1. These shares do not include the shares surrendered to Abbott to satisfy tax withholding obligations in connection with the vesting of restricted stock or restricted stock units. Interest expense (income), net decreased $5 million in the first quarter of 2018 compared to 2017 due to higher interest income in the first quarter of 2018 as a result of higher rates of return on cash and cash equivalents and short-term investments. The components of the changes in other comprehensive income from continuing operations, net of income taxes, are as follows: Cumulative Foreign Instruments (2) All rights reserved. Effective January 1, 2018, Abbott adopted Accounting Standards Update 2017-07, Compensation – Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost, which resulted in a retrospective reclassification of approximately $160 million of net pension-related income from Operating earnings to Other (income) expense, net for the full year of 2017. The AMO business was included in Abbott’s results as a non-reportable segment through February 27, 2017, the date of the divestiture. Rebate amounts are usually based upon the volume of purchases using contractual or statutory prices for a product. 2018 Tax expense on Earnings from Continuing Operations includes an additional $85 million of tax expense for the transition tax associated with the Tax Cuts and Jobs Act (TCJA). Purchased, (b) Average A reconciliation of the full-year tax rates for continuing operations for 2018 and 2017 is shown below: Reported tax rate on a GAAP basis for 2018 includes the impact of an additional $120 million of tax expense for the transition tax associated with the TCJA, as well as the impact of approximately $90 million in excess tax benefits associated with share-based compensation. The cumulative effect of applying the new standard resulted in an increase to At March 31, 2018, Abbott’s long-term debt rating was BBB by Standard & Poor’s Corporation and Baa2 by Moody’s Investors Service. Abbott discloses Trade receivables separately in the Condensed Consolidated Balance Sheet at their net realizable value. Dollar Value) of The remaining shares were cashed out for an amount equal to the $400.00 per share liquidation preference of such shares, plus accrued but unpaid dividends, without interest. Securities, Cumulative Gains In the U.S., Abbott’s federal income tax returns through 2013 are settled except for the federal income tax returns of the former Alere consolidated group which are settled through 2012. These amounts are reported in the Condensed Consolidated Statement of Earnings on the Net foreign exchange (gain) loss line. Historical data is readily available and reliable, and is used for estimating the amount of the reduction in gross sales. a) Reflects sales related to a non-core product line within the U.S. At March 31, 2018 and December 31, 2017, Abbott held the gross notional amount of $18.1 billion and $20.1 billion, respectively, of such foreign currency forward exchange contracts.          Credits, Cumulative Abbott is issuing full-year 2019 guidance for organic sales growth of 6.5 to 7.5 percent2, which excludes the impact of foreign exchange, and diluted earnings per share from continuing operations under Generally Accepted Accounting Principles (GAAP) of $1.80 to $1.90. and Cost , which requires that restricted cash be included with cash and cash equivalents when reconciling the beginning and end-of-period total amounts shown on the statement of cash flows. Abbott incurred a net charge of $14 million related to the early repayment of this debt. Abbott has increased its dividend payout for 47 consecutive years and is a member of the S&P 500 Dividend Aristocrats Index, which tracks companies that have annually increased their dividend for at least 25 consecutive years. Please be aware that the website you have requested is intended for the residents of a particular country or region, as noted on that site. In the U.S., the 4.0 percent increase in Adult Nutritional sales was driven by the growth of While service cost continues to be reported in the same financial statement line items as other current employee compensation costs, the ASU requires all other components of pension and other postretirement benefit expense to be presented separately from service cost, and outside any subtotal of income from operations. The amount of hedge ineffectiveness was not significant in 2018 and 2017 for these hedges. Compensation — Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost 2018 Net Earnings and Diluted Earnings per Common Share from Continuing Operations, excluding Specified Items, excludes net after-tax charges of $2.797 billion, or $1.57 per share, for intangible amortization expense and other expenses primarily associated with acquisitions and restructuring actions. The goodwill is primarily attributable to expected synergies from combining operations, as well as intangible assets that do not qualify for separate recognition. The preliminary allocation of the fair value of the Alere acquisition is shown in the table below. International adult sales increased 0.9 percent on a reported basis, including an unfavorable 5.7 percent effect of foreign exchange, and increased 6.6 percent on an organic basis.