Baxter International Q4 worldwide sales $2.8 billion
Staff Writer |
Baxter International reported results for the fourth quarter ended December 31, 2017.
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In the fourth quarter, worldwide sales totaled approximately $2.8 billion, an increase of 5 percent on a reported basis, 3 percent on a constant currency basis and 2 percent on an operational basis as compared to the prior-year period.
perational sales adjust for the impact of foreign exchange, generic competition for U.S. cyclophosphamide, the Claris Injectables (Claris) acquisition and the previously communicated select strategic product exits the company is undertaking.
In line with the financial outlook shared on October 25, 2017, fourth quarter revenues were negatively impacted by approximately $70 million as a result of temporary manufacturing disruptions in Puerto Rico due to the impact of Hurricane Maria.
Sales in the U.S. were $1.1 billion, increasing 1 percent. International sales totaled more than $1.6 billion, representing an 8 percent increase on a reported basis and a 4 percent increase on a constant currency basis.
Global sales for Hospital Products totaled $1.7 billion in the fourth quarter, advancing 5 percent on a reported basis, 3 percent on a constant currency basis and 1 percent operationally as compared to the prior-year period.
Performance in the quarter benefited from continued strength in our U.S. fluid systems business as well as favorable demand for injectable pharmaceuticals, which includes the contribution of approximately $30 million of sales from the acquisition of Claris.
Sales in the quarter also benefited from increased demand for the company’s advanced surgery products as well as cytotoxic contract manufacturing services. Hospital Products fourth quarter sales were negatively impacted by approximately $70 million as result of the Hurricane Maria related manufacturing disruptions.
Baxter’s fourth quarter Renal sales were approximately $1.1 billion, representing an increase of 5 percent on a reported basis, 3 percent on a constant currency basis and 4 percent operationally. Sales growth in Renal was driven by solid performance globally across both chronic and acute renal therapies.
Baxter reported a net loss from continuing operations of $61 million, or $0.11 per diluted share, on a GAAP (Generally Accepted Accounting Principles) basis for the fourth quarter.
These results included special items totaling $137 million net ($415 million net after-tax, which includes a net tax charge of $322 million related to the estimated impact of U.S. tax reform).
Other special charges in the quarter primarily included business optimization and intangible asset amortization.
On an adjusted basis, excluding special items, Baxter’s fourth quarter income from continuing operations totaled $354 million, or $0.64 per diluted share, exceeding the company’s previously issued guidance of $0.56 to $0.59 per diluted share.
Summary of full-year results
Baxter’s worldwide sales totaled approximately $10.6 billion in 2017, an increase of 4 percent on both a reported and constant currency basis, and 5 percent on an operational basis as compared to the prior-year period. Sales within the United States totaled $4.5 billion, improving 6 percent on both a reported and operational basis over the prior year.
International sales totaled approximately $6.1 billion, representing a 2 percent increase on a reported and constant currency basis and 4 percent operationally.
Full-year sales for Hospital Products totaled $6.6 billion, reflecting growth of 5 percent on a reported, constant currency and operational basis. Baxter’s Renal sales totaled more than $3.9 billion, increasing 2 percent on both a reported and constant currency basis and 4 percent operationally.
For full-year 2017, Baxter reported income from continuing operations of $724 million, or $1.30 per diluted share, on a GAAP basis.
These results include special items of $461 million net ($652 million net after-tax, including the estimated net impact of U.S. tax reform) primarily related to business optimization initiatives, intangible asset amortization, Claris integration expenses and deconsolidation of the company’s Venezuelan operations.
On an adjusted basis, excluding special items, Baxter’s full-year income from continuing operations totaled approximately $1.4 billion, or $2.48 per diluted share.
In 2017, Baxter generated $1.85 billion in operating cash flow, an increase of $229 million driven by improved operational performance and the continuing impact of programs focused on improving the company’s working capital.
In addition, through disciplined management of expenditures, Baxter reduced capital spending by $85 million to $634 million. As a result, the company generated an increase of $314 million in free cash flow to $1.22 billion (operating cash flow less capital expenditures). ■