-- Affirms Sales Projection and Narrows Earnings Guidance to Upper End of Range for 2009 --
LAKE FOREST, Ill., April 28 /PRNewswire-FirstCall/ -- Hospira, Inc. , a leading global specialty pharmaceutical and medication delivery company, today reported results for the first quarter ended March 31, 2009. Net sales for the quarter were $860 million, and adjusted* diluted earnings per share were $0.60. (Adjusted* measures exclude certain specified items as described later in this press release and the attached schedules.)
"Hospira delivered on its commitments in the first quarter, generating solid sales and earnings growth in a period marked by continued economic uncertainty," said Christopher B. Begley, chairman and chief executive officer. "Looking forward, we believe the results of our strategic investments and our focus on execution position us well to deliver our financial commitments for 2009. In addition, we are driving operational excellence through our optimization initiatives under Project Fuel, which will create long-term, sustainable growth and increased shareholder value."
First-Quarter 2009 Results
The following table highlights selected financial results for the first quarter of 2009 compared to the same period in 2008:
Results under U.S. Generally Accepted Accounting Principles (GAAP) include items as detailed in the schedules attached to this press release, including a $0.57 benefit to first-quarter 2009 GAAP diluted earnings per share from the settlement of a U.S. Internal Revenue Service audit.
Net sales decreased 3.3 percent to $860 million in the first quarter of 2009, compared to $889 million in the first quarter of 2008. Growth in Other Pharma in the Americas segment and solid overall performance in Medication Management Systems (MMS), mainly a function of continued penetration of Symbiq(R), were offset by unfavorable foreign currency translation and continued pricing pressure in Specialty Injectable Pharmaceuticals (SIP) in the Europe, Middle East and Africa (EMEA) segment.
Adjusted* operating income increased 3.2 percent to $150 million in the first quarter of 2009, compared to $145 million in the first quarter of 2008. Driving the majority of the increase was improved manufacturing efficiency, with a contribution from favorable volume/mix.
Cash Flow
Cash flow from operations for the first quarter of 2009 was $89 million, compared to the $74 million generated in the same period in 2008.
Capital expenditures decreased to $34 million for the first quarter of 2009, compared to $43 million in the first quarter of 2008, due to the continued impact of capital-spending controls the company put into effect in the second half of 2008.
2009 Projections
Hospira continues to expect net sales for the year to increase approximately 4 to 6 percent on a constant-currency basis. Including the impact of foreign exchange, the company expects net sales to be flat.
Given the continued uncertainty surrounding the approval timing of piperacillin tazobactam, a key generic injectable pharmaceutical projected to launch during the year, Hospira has elected to remove sales of the drug from its 2009 projections. Offsetting this impact, the company now expects to receive a benefit from a lower estimated effective tax rate for 2009, as well as anticipated savings from the company's optimization efforts under its Project Fuel initiative. Hospira therefore projects adjusted* diluted earnings per share for full-year 2009 to range between $2.67 to $2.72 per share.
The reconciliation between the projected 2009 adjusted* diluted earnings per share and GAAP diluted earnings per share follows:
Projections for cash flow from operations, depreciation and amortization, and capital expenditures remain unchanged. The company continues to project that cash flow from operations in 2009 will be in the $565 million to $615 million range. Depreciation and amortization is expected to be between $210 million and $220 million. Capital expenditures are projected to be between $155 million and $175 million.
*Use of Non-GAAP Financial Measures
Non-GAAP financial 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 filed with the Securities and Exchange Commission on the date of this press release.
Webcast
Hospira will hold a conference call for investors and media at 8 a.m. Central time on Tuesday, April 28, 2009. A live webcast of the conference call will be available at www.hospirainvestor.com. Listeners should log on approximately 10 minutes in advance to ensure proper computer setup for receiving the webcast. A replay will be available on the Hospira Web site for 30 days following the call.
About Hospira
Hospira, Inc. is a global specialty pharmaceutical and medication delivery company dedicated to Advancing Wellness(TM). As the world leader in specialty generic injectable pharmaceuticals, Hospira offers one of the broadest portfolios of generic acute-care and oncology injectables, as well as integrated infusion therapy and medication management solutions. Through its products, Hospira helps improve the safety, cost and productivity of patient care. The company is headquartered in Lake Forest, Ill., and has approximately 14,000 employees. Learn more at www.hospira.com.
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 and expenses, and other statements regarding Hospira's goals and strategy. Hospira cautions that these forward-looking statements are subject to risks, uncertainties and assumptions, many of which are beyond Hospira's control, 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 Hospira's operations and may cause actual results to be materially different from expectations include the risks, uncertainties and factors discussed under the headings "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, filed with the Securities and Exchange Commission, which is incorporated by reference. Hospira undertakes no obligation to release publicly any revisions to forward-looking statements as the result of subsequent events or developments.
CONTACT: Media, Stacey Eisen, +1-224-212-2276, or Tareta Adams,
+1-224-212-2535, or Financial Community, Karen King, +1-224-212-2711, all
of Hospira, Inc.
Web site: http://www.hospira.com/
