NEW YORK--(BUSINESS WIRE)--Jan. 27, 2009--Bristol-Myers Squibb Company (NYSE:BMY):
-
Key Franchises and Products Drive Solid Top-Line Growth
-
Financial Results Supported by Significant Improvement in Gross
Profit and Improved Cost Management Driven Largely By Productivity
Initiatives
-
Provides 2009 GAAP EPS Guidance Range of $1.58 to $1.73;
Non-GAAP EPS Guidance Range of $1.85 to $2.00
Bristol-Myers
Squibb Company (NYSE: BMY) today announced strong fourth quarter
sales and earnings growth completing the company's excellent overall
2008 financial performance.
"In the quarter, and in the past year, we've taken decisive action as a
BioPharma leader to become leaner and more agile," said James M.
Cornelius, chairman and chief executive officer. "I'm particularly
pleased by our global commercial teams in presenting our value
proposition to customers and payers. We've executed with speed and rigor
against our strategy. Results this quarter continued to be strong,
capping off an outstanding year.
"We are reaching our objectives in all areas. Our favorable cash
position expedites our business development efforts. Our 'String of
Pearls' grows more valuable with each asset and alliance we add. And
we're becoming more productive, as seen in our growing profit margins.
"In 2009, we expect to deliver on our promises to advance our innovative
pipeline, execute our business development plans, grow margins and meet
our productivity goals. We are well on-track to fulfill our commitments
to patients and shareholders, and to navigate the challenges of coming
years."
Fourth Quarter
$ amounts in millions, except per share amounts
2008 2007 Change
Net Sales $ 5,249 $ 5,058 4 %
Net Earnings/(Loss) Per Common Share -- Diluted 0.63 (0.05 ) *
GAAP Diluted EPS From Continuing Operations 0.61 (0.10 ) *
Non-GAAP Diluted EPS From Continuing Operations 0.46 0.30 53 %
Full Year
2008 2007 Change
Net Sales $ 20,597 $ 18,193 13 %
Net Earnings Per Common Share -- Diluted 2.63 1.09 141 %
GAAP Diluted EPS From Continuing Operations 1.59 0.88 81 %
Non-GAAP Diluted EPS From Continuing Operations 1.74 1.27 37 %
* in excess of +/- 200%
FOURTH QUARTER RESULTS
-- Bristol-Myers Squibb posted fourth quarter 2008 net sales from
continuing operations of $5.2 billion, an increase of 4%, or 8%
excluding foreign exchange impact, compared to the same period in 2007.
Pharmaceutical net sales totaled $4.5 billion and sales from Mead
Johnson Nutrition Company totaled $707 million in the fourth quarter of
2008, representing increases of 4% and 6%, respectively, compared to
2007.
-- U.S. pharmaceutical net sales increased 13% to $2.8 billion in the
fourth quarter of 2008 compared to the same period in 2007.
International pharmaceutical net sales decreased 9% to $1.7 billion.
This decrease was due primarily to an 8% unfavorable foreign exchange
impact and the divestiture and erosion of some mature brands in Latin
America, Middle East and Japan.
-- Gross profit as a percentage of net sales improved to 71.0% in the
fourth quarter 2008 compared to 66.1% in 2007. This improvement was
mostly driven by higher manufacturing rationalization charges in 2007,
cost improvements, favorable product mix and price increases.
-- Marketing, selling and administrative expenses increased by 2%, or 7%
excluding foreign exchange impact, to $1.3 billion in the fourth quarter
of 2008 compared to the same period in 2007.
-- Advertising and product promotion spending decreased by 3%, or was flat
excluding foreign exchange impact, to $449 million in the fourth quarter
of 2008, compared to the same period in 2007.
-- Research and development expenses increased by 29%, or 31% excluding
foreign exchange impact, to $1.1 billion in the fourth quarter of 2008
compared to the same period in 2007. The increase was due to upfront and
milestone payments to Exelixis in 2008 as part of an expansion of the
collaboration between the companies.
-- The effective tax rate on earnings from continuing operations before
minority interest and income taxes was 22.5% for the fourth quarter of
2008, and includes the full-year impact of the research and development
tax credit.
-- The company reported fourth quarter net earnings from continuing
operations of $1.2 billion or $0.61 per diluted share, compared to net
loss of $192 million or $0.10 per diluted share for the same period in
2007. The fourth quarter 2008 net earnings include a $582 million after
tax gain, or $0.29 per diluted share, mainly attributed to the proceeds
from the sale of our stake in ImClone Systems. An overview of the
specified items is discussed under "Use of Non-GAAP Financial
Information."
PRODUCT AND PIPELINE UPDATE
-- Bristol-Myers Squibb's top-line growth in the fourth quarter was led by
key drivers including steady growth for PLAVIX in the U.S. and strong
sales increases for ABILIFY across all indications and regions. ORENCIA
and SPRYCEL sales continued to grow, fueled by additional indications
and country approvals. The company's virology portfolio, led by the
SUSTIVA franchise for HIV and BARACLUDE for hepatitis B also
demonstrated consistent growth worldwide.
-- In December, the company and its marketing partner, sanofi-aventis,
announced that the U.S. Court of Appeals for the Federal Circuit upheld
the June 19, 2007 decision by the U.S. District Court for the Southern
District of New York holding the U.S. patent 4,847,265 covering
clopidogrel bisulphate, the active ingredient in PLAVIX, valid and
enforceable. As a result of this ruling, the '265 patent protection for
this product is maintained in the United States until November 2011,
subject to any further legal proceedings.
-- In the fourth quarter, the company submitted a supplemental biologics
licensing application (sBLA) which was accepted for filing by the FDA
for the use of ORENCIA for patients with early rheumatoid arthritis.
-- The company announced new data in November from two separate cohort
evaluations, which suggest that long-term treatment with BARACLUDE may
reduce liver damage caused by chronic hepatitis B. Long-term treatment
with BARACLUDE was associated with improved liver histology, including
improvement in fibrosis, in chronic hepatitis B patients.
-- On October 1, the FDA approved the use of REYATAZ 300 milligram
once-daily boosted with ritonavir 100 milligram as part of combination
therapy in previously untreated (treatment-naive) HIV-1 infected
patients.
-- In November, the Committee for Medicinal Products for Human Use (CHMP)
in Europe issued a negative opinion on the marketing authorization
application for IXEMPRA (ixabepilone) in the treatment of patients with
metastatic breast cancer. Bristol-Myers Squibb submitted a request for
re-examination of the opinion and will continue to work closely with the
agency.
-- In January 2009, the company announced the approval of SPRYCEL in Japan.
SELECTED BALANCE SHEET AND CASH UPDATE
Bristol-Myers Squibb continues to make significant progress in
strengthening its balance sheet and cash position. The company launched
a new working capital initiative during the quarter with the goal of
improving cash flows by approximately $1 billion by 2010. This will help
provide greater flexibility for future strategic investments.
The company's cash and cash equivalents were $8.0 billion as of December
31, 2008 of which a significant majority was invested in U.S. Treasury
Bills and Treasury-backed securities. The company's net cash position
improved to $1.5 billion from $1.2 billion as of September 30. The
company received $1.0 billion in the fourth quarter from the sale of its
shares of ImClone Systems and also received proceeds from the sale of a
non-core business.
PRODUCTIVITY TRANSFORMATION UPDATE
In December 2007 and July 2008, Bristol-Myers Squibb announced parts of
its overall Productivity Transformation Initiative (PTI) designed to
create a total of $2.5 billion in productivity cost savings and
avoidance by 2012. The company has identified projects to deliver the
entire $2.5 billion and by the end of 2008, had executed actions against
projects to deliver approximately $1.2 billion in annual productivity
savings.
These successful continuous improvement initiatives encompass all areas
of the company including procurement, research and development, supply
chain optimization and commercial operations. As planned, the company
has streamlined the organization, which has included the reduction of
headcount, in alignment with the new BioPharma model. The total charges
associated with both previously-announced waves of PTI are estimated to
be in the range of $1.3 billion to $1.6 billion, which includes
approximately $700 million of costs already incurred.
BUSINESS DEVELOPMENT UPDATE
Bristol-Myers Squibb continued to move forward with the
previously-announced initial public offering of Mead Johnson Nutrition
Company and intends to complete the transaction in the first half of
2009.
The company is focused on supplementing its internal research and
development portfolio with strategic partnerships and acquisitions. In
December, the company announced a global collaboration with Exelixis,
Inc. covering two novel molecules for cancer: XL184, a small molecule
inhibitor of MET, VEGFR2 and RET, which is currently in Phase III
development for medullary thyroid cancer and XL281, a small molecule
inhibitor of RAF kinase, which is currently in Phase I development for
the treatment of patients with advanced solid tumor malignancies.
The company and its partner AstraZeneca announced the expansion of the
companies' worldwide collaboration to develop and commercialize
dapagliflozin in Japan. Dapagliflozin is currently being studied in
Phase III clinical trials to assess its efficacy and safety as a
once-daily treatment for type 2 diabetes.
On January 12, 2009 the company announced a global collaboration with
ZymoGenetics for a PEG-interferon lambda, a novel type 3 interferon
currently in Phase Ib development for the treatment of Hepatitis C, and
its related development program.
2009 GUIDANCE
Bristol-Myers Squibb has provided 2009 GAAP EPS guidance of $1.58 to
$1.73 and non-GAAP EPS guidance of $1.85 to $2.00. Key non-GAAP guidance
assumptions include low single-digit revenue growth (mid-to-high single
digit growth excluding foreign exchange); slight improvement in gross
margins; advertising and promotion increase in the low-to-mid
single-digit range; marketing, sales and administrative expense decrease
in the low-to-mid single digits; research and development expense growth
in the mid single-digit range; and an effective tax rate of
approximately 24%.
The company reaffirms guidance that it expects non-GAAP earnings per
share from continuing operations to grow at a minimum of 15 percent
compounded annual growth rate, from the 2007 base through 2010 without
rebasing for the sale of the ConvaTec business, excluding costs
associated with the PTI and other specified items that have not yet been
identified and quantified.
The non-GAAP 2009 guidance and the three-year compound annual growth
rate exclude other specified items such as gains or losses from sale of
businesses and product lines; from sale of equity investments and from
discontinued operations; restructuring and other exit costs; accelerated
depreciation charges; asset impairments; charges and recoveries relating
to significant legal proceedings; upfront and milestone payments for
licensing arrangements; payments for in-process research and
development; debt retirement costs; impairments to investments; and
significant tax events.
The financial guidance for 2009 and the three-year compound annual
growth rate exclude the impact of any potential strategic acquisitions
and divestitures and further assume that the company and its partner,
sanofi-aventis, maintain U.S. exclusivity for the PLAVIX(R) patent
through at least 2010.
Use of Non-GAAP Financial Information
This press release contains non-GAAP financial measures, including
non-GAAP earnings and earnings per share information, adjusted to
exclude certain costs, expenses, gains and losses and other specified
items. Among the items in GAAP measures but excluded for purposes of
determining adjusted earnings and other adjusted measures are: charges
related to implementation of the Productivity Transformation Initiative
and the company's strategy for Mead Johnson Nutritionals; gains or
losses from the sale of businesses and product lines; the sale and
leaseback of properties; discontinued operations; restructuring and
other exit costs; accelerated depreciation charges; asset impairments;
charges and recoveries relating to significant legal proceedings;
upfront and milestone payments for in-licensing of products that have
not achieved regulatory approval that are immediately expensed; payments
for in-process research and development; impairments to investments; and
significant tax events. This information is intended to enhance an
investor's overall understanding of the company's past financial
performance and prospects for the future. For example, non-GAAP earnings
and earnings per share information is an indication of the company's
baseline performance before items that are considered by the company to
be not reflective of the company's ongoing results. In addition, this
information is among the primary indicators the company uses as a basis
for evaluating company performance, allocating resources, setting
incentive compensation targets, and planning and forecasting of future
periods. This information is not intended to be considered in isolation
or as a substitute for net earnings or diluted earnings per share
prepared in accordance with GAAP.
Statement on Cautionary Factors
This press release contains certain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
regarding, among other things, statements relating to goals, plans and
projections regarding the company's financial position, results of
operations, market position, product development and business strategy.
These statements may be identified by the fact that they use words such
as "anticipate", "estimates", "should", "expect", "guidance", "project",
"intend", "plan", "believe" and other words and terms of similar meaning
in connection with any discussion of future operating or financial
performance. Such forward-looking statements are based on current
expectations and involve inherent risks and uncertainties, including
factors that could delay, divert or change any of them, and could cause
actual outcomes and results to differ materially from current
expectations. These factors include, among other things, market factors
(including whether uncertainties in or further deterioration of the
credit and capital markets will lead to future impairments to the
company's investment portfolio), competitive product development and
approvals, pricing controls and pressures (including changes in rules
and practices of managed care groups and institutional and governmental
purchasers), economic conditions such as interest rate and currency
exchange rate fluctuations, judicial decisions and governmental laws and
regulations related to Medicare, Medicaid and healthcare reform,
pharmaceutical rebates and reimbursement, claims and concerns that may
arise regarding the safety and efficacy of in-line products and product
candidates, changes to wholesaler inventory levels, variability in data
provided by third parties, changes in, and interpretation of,
governmental regulations and legislation affecting domestic or foreign
operations, including tax obligations, difficulties and delays in
product development, manufacturing or sales, patent positions and the
ultimate outcome of any litigation matter, including whether Apotex will
prevail in its appealing of the Circuit court's decision in the PLAVIX(R)
patent litigation. These factors also include the company's ability to
execute successfully its strategic plans, including its Productivity
Transformation Initiative, the expiration of patents or data protection
on certain products (including the expiration of data protection for
PLAVIX(R) in the European Union), and the impact and result of
governmental investigations. There can be no guarantees with respect to
pipeline products that future clinical studies will support the data
described in this release, that the products will receive necessary
regulatory approvals, or that they will prove to be commercially
successful; nor are there guarantees that regulatory approvals will be
sought, or sought within currently expected timeframes, or that
contractual milestones will be achieved. For further details and a
discussion of these and other risks and uncertainties, see the company's
periodic reports, including the annual report on Form 10-K, quarterly
reports on Form 10-Q and current reports on Form 8-K, filed with or
furnished to the Securities and Exchange Commission. The company
undertakes no obligation to publicly update any forward-looking
statement, whether as a result of new information, future events or
otherwise.
Statement on Mead Johnson Nutrition
Company Registration Statement
A registration statement relating to the securities of Mead Johnson
Nutrition Company has been filed with the U.S. Securities and Exchange
Commission but has not yet become effective. These securities may not be
sold nor may offers to buy these securities be accepted before the time
the registration statement becomes effective. This press release shall
not constitute an offer to sell or a solicitation of an offer to buy,
nor shall there be any sale of these securities in any state or
jurisdiction in which such an offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities
laws of any such state or jurisdiction.
Company and Conference Call Information
Bristol-Myers Squibb is a global biopharmaceutical company whose mission
is to extend and enhance human life.
There will be a conference call on January 27, 2009 at 10:30 a.m. (EST)
during which company executives will address inquiries from investors
and analysts. Investors and the general public are invited to listen to
a live web cast of the call at www.bms.com/ir
or by dialing 913-312-1265, confirmation code 8272493. Materials related
to the call will be available at the same website prior to the call.
For more information, contact: Brian Henry, 609-252-3337,
Communications, Tracy Furey, 609-252-3208, Communications, John Elicker,
609-252-4611, Investor Relations, or Suketu Desai, 609-252-5796,
Investor Relations.
ABILIFY(R) is the trademark of Otsuka Pharmaceutical Co., Ltd.
ATRIPLATM is a trademark of both Bristol-Myers Squibb Co. and Gilead Sciences,
Inc.
AVAPRO(R), AVALIDE(R) and PLAVIX(R) are trademarks of sanofi-aventis
ERBITUX(R) is a trademark of ImClone Systems Incorporated
BRISTOL-MYERS SQUIBB COMPANY
NET SALES BY OPERATING SEGMENTS
FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2008 AND 2007
(Unaudited, dollars in millions)
Three Months Twelve Months
Ended December 31, Ended December 31,
2008 2007 2008 2007
Pharmaceuticals $ 4,542 $ 4,388 $ 17,715 $ 15,622
Nutritionals 707 670 2,882 2,571
Net Sales $ 5,249 $ 5,058 $ 20,597 $ 18,193
BRISTOL-MYERS SQUIBB COMPANY
SELECTED PRODUCTS
FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2008 AND 2007
(Unaudited, dollars in millions)
The following table sets forth worldwide and U.S. reported net sales for
selected products for the three and twelve months ended December 31, 2008
compared to the three and twelve months ended December 31, 2007. In
addition, the table includes, where applicable, the estimated total U.S.
prescription change for the retail and mail-order channels for the
comparative periods presented for certain of the company's U.S.
pharmaceutical products based on third-party data. A significant portion
of the company's U.S. pharmaceutical sales is made to wholesalers. Where
changes in reported net sales differ from prescription growth, this change
in net sales may not reflect underlying prescriber demand.
Worldwide Net Sales U.S. Net Sales
% Change in
2008 2007 % 2008 2007 % U.S. Total
Change Change Prescriptions
vs. 2007
Three Months
Ended December
31,
Pharmaceuticals
Cardiovascular
Plavix $ $ 1,374 7% $1,311 $ 1,178 11% 3%
1,469
Avapro/Avalide 316 328 (4)% 188 183 3% (8)%
Pravachol 27 90 (70)% (17)* 18 (194)% (47)%
Virology
Reyataz 329 334 (1)% 172 165 4% 14%
Sustiva
Franchise 300 260 15% 193 162 19% 14%
(total
revenue)
Baraclude 153 99 55% 40 29 38% 43%
Oncology
Erbitux 182 185 (2)% 179 182 (2)% N/A
Taxol 99 114 (13)% 4 5 (20)% N/A
Sprycel 86 56 54% 30 17 76% 18%
Ixempra 25 15 67% 23 15 53% N/A
Affective
(Psychiatric)
Disorders
Abilify 606 462 31% 490 361 36% 31%
Immunoscience
Orencia 129 75 72% 106 66 61% N/A
Nutritionals
Enfamil 285 280 2% 179 179 - N/A
* negative sales attributed to increased returns reserve
Worldwide Net Sales U.S. Net Sales
% Change in
2008 2007 % 2008 2007 % U.S. Total
Change Change Prescriptions
vs. 2007
Twelve Months
Ended December
31
Pharmaceuticals
Cardiovascular
Plavix $5,603 $4,755 18% $4,920 $4,060 21% 19%
Avapro/Avalide 1,290 1,204 7% 735 692 6% (7)%
Pravachol 203 443 (54)% (10)** 139 (107)% (75)%
Virology
Reyataz 1,292 1,124 15% 667 587 14% 14%
Sustiva
Franchise 1,149 956 20% 724 604 20% 14%
(total revenue)
Baraclude 541 275 97% 140 88 59% 55%
Oncology
Erbitux 749 692 8% 739 683 8% N/A
Taxol 385 422 (9)% 6 14 (57)% N/A
Sprycel 310 158 96% 92 58 59% 36%
Ixempra 101 15 * 98 15 * N/A
Affective
(Psychiatric)
Disorders
Abilify 2,153 1,660 30% 1,676 1,305 28% 23%
Immunoscience
Orencia 441 231 91% 363 216 68% N/A
Nutritionals
Enfamil 1,157 1,082 7% 715 722 (1)% N/A
* In excess of +/- 200%
** negative sales attributed to increased returns reserve
BRISTOL-MYERS SQUIBB COMPANY
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2008 AND 2007
(Unaudited, amounts in millions except per share data)
Three Months Twelve Months
Ended December 31, Ended December 31,
2008 2007 2008 2007
Net Sales $ 5,249 $ 5,058 $ 20,597 $ 18,193
Cost of products sold 1,522 1,716 6,396 5,868
Marketing, selling and 1,285 1,256 4,792 4,516
administrative
Advertising and product promotion 449 465 1,550 1,415
Research and development 1,143 889 3,585 3,227
Acquired in-process research and -- 230 32 230
development
Provision for restructuring, net 151 139 218 183
Litigation expense, net 1 -- 33 14
Gain on sale of product lines and (159 ) -- (159 ) (273 )
businesses
Equity in net income of affiliates (139 ) (131 ) (617 ) (524 )
Other (income)/expense, net (a) (892 ) 322 (704 ) 351
Total expenses 3,361 4,886 15,126 15,007
Earnings from Continuing
Operations 1,888 172 5,471 3,186
Before Minority Interest and
Income Taxes
Provision for income taxes 424 147 1,320 682
Minority interest, net of taxes 266 217 996 763
Net Earnings/(Loss) from 1,198 (192 ) 3,155 1,741
Continuing Operations
Discontinued Operations:
Earnings, net of taxes 6 103 113 424
Gain on Disposal, net of taxes 40 -- 1,979 --
46 103 2,092 424
Net Earnings/(Loss) $ 1,244 $ (89 ) $ 5,247 $ 2,165
Earnings per Common Share
Basic:
Net Earnings/(Loss) from $ 0.61 $ (0.10 ) $ 1.60 $ 0.88
Continuing Operations
Discontinued Operations:
Earnings, net of taxes -- 0.05 0.05 0.22
Gain on Disposal, net of taxes .02 -- 1.00 --
Net Earnings/(Loss) per Common $ 0.63 $ (0.05 ) $ 2.65 $ 1.10
Share
Diluted:
Net Earnings/(Loss) from $ 0.61 $ (0.10 ) $ 1.59 $ 0.88
Continuing Operations
Discontinued Operations:
Earnings, net of taxes -- 0.05 0.05 0.21
Gain on Disposal, net of taxes .02 -- 0.99 --
Net Earnings/(Loss) per Common $ 0.63 $ (0.05 ) $ 2.63 $ 1.09
Share
Average Common Shares Outstanding:
Basic 1,978 1,975 1,977 1,970
Diluted 1,982 1,975 2,001 1,980
(a) Other expense, net
Interest expense $ 73 $ 96 $ 310 $ 421
Interest income (19 ) (57 ) (130 ) (241 )
Impairment charge of marketable 77 275 324 275
securities
Sale of ImClone shares (895 ) -- (895 ) --
Foreign exchange transaction (42 ) (9 ) (76 ) 15
(gains)/losses
Other, net (86 ) 17 (237 ) (119 )
$ (892 ) $ 322 $ (704 ) $ 351
BRISTOL MYERS SQUIBB COMPANY
SPECIFIED ITEMS
FOR THE THREE MONTHS ENDED DECEMBER 31, 2008 AND 2007
(Unaudited, dollars in millions)
Three months ended December 31, 2008
Gain on Other
Cost of Marketing, Research Provision for Litigation sale of (income)/
products selling and and restructuring, expense, product expense, Total
sold administrative development net net lines and net
businesses
Productivity
Transformation
Initiative:
Downsizing and
streamlining of $ - $ - $ - $ 122 $ - $ - $ - $ 122
worldwide operations
Accelerated
depreciation, asset
impairment and other 6 - - 20 - - 8 34
shutdown
costs
Pension 9 - - - - - 8 17
settlements/curtailments
Process standardization - 45 - - - - - 45
implementation costs
Termination of lease - - - 9 - - 6 15
contracts
Gain on sale of product
lines and - - - - - (159) - (159)
businesses
15 45 - 151 - (159) 22 74
Litigation Matters:
Litigation settlement - - - - 1 - - 1
Insurance recovery - - - - - - (20) (20)
Other:
Mead Johnson
Nutritionals - 31 - - - - 3 34
charges
Upfront and milestone - - 260 - - - - 260
payments
Asset impairment 27 - 13 - - - - 40
Auction rate securities
impairment - - - - - 77 77
and (gains)/losses
Debt buyback and swap - - - - - - (57) (57)
terminations
Gain on sale of ImClone - - - - - - (895) (895)
shares
$42 $76 $273 $151 $1 $(159) $ (870) (486)
Income taxes on items 193
above
Increase to Net Earnings from Continuing Operations $
(293)
Three months ended December 31, 2007
Acquired
Cost of Marketing, Research in- Provision for Other
products selling and and process restructuring, (income)/ Total
sold administrative development research net expense,
and net
development
Productivity
Transformation
Initiative:
Downsizing and
streamlining of $ - $ - $ - $ - $ 139 $ 6 $ 145
worldwide
operations
Accelerated
depreciation
and 102 8 - - - - 110
asset
impairment
Process
standardization - 5 - - - 32 37
implementation
costs
102 13 - - 139 38 292
Other:
Product - - - - - 10 10
liability
Upfront and
milestone
payments
and acquired - - 5 230 - - 235
in-process
research and
development
Auction rate
securities - - - - - 275 275
impairment
Accelerated
depreciation,
asset 31 - - - - 23 54
impairment and
contract
termination
Gain on sale of - - - - (9) (9)
properties
$133 $13 $5 $230 $139 $337 857
Income taxes on (70)
items above
Decrease to Net Earnings from Continuing Operations $787
BRISTOL-MYERS SQUIBB COMPANY
SPECIFIED ITEMS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2008 AND 2007
(Unaudited, dollars in millions)
Twelve months ended December 31, 2008
Marketing, Acquired Provision Gain on Other
Cost of selling Research in-process for Litigation sale of (income)/
products and and research restructuring, expense, product expense, Total
sold administrative development and net net lines and net
development businesses
Productivity
Transformation
Initiative:
Downsizing and
streamlining $ - $ - $ - $ - $ 189 $ - $ - $ - $ 189
of worldwide operations
Accelerated
depreciation, asset 213 - - - 20 - - 8 241
impairment and other
shutdown costs
Pension 9 - - - - - - 8 17
settlements/curtailments
Process standardization - 109 - - - - - - 109
implementation costs
Gain on sale and
leaseback of - - - - - - - (9) (9)
properties
Termination of lease - - - - 9 - - 6 15
contracts
Gain on sale of product
lines - - - - - - (159) - (159)
and businesses
222 109 - - 218 - (159) 13 403
Litigation Matters:
Litigation settlement - - - - - 33 - - 33
Insurance recovery - - - - - - - (20) (20)
Other:
Mead Johnson
Nutritionals - 41 - - - - - 3 44
charges
Product liability - - - - - - - 18 18
Upfront and milestone
payments and acquired
in- - - 348 32 - - - - 380
process research &
development
Asset Impairment 27 - 13 - - - - - 40
Auction rate securities
impairment and - - - - - - - 324 324
(gains)/losses
Debt buyback and swap - - - - - - - (57) (57)
terminations
Gain on sale of ImClone - - - - - - - (895) (895)
shares
$ 249 $ 150 $ 361 $ 32 $ 218 $ 33 $ (159) $ (614) 270
Income taxes on items 39
above
Decrease to Net Earnings from Continuing Operations $ 309
Twelve months ended December 31, 2007
Acquired Gain on
Cost of Marketing, Research in-process Provision for Litigation sale of Other
products selling and research restructuring, expense, product (income)/ Total
sold and development and net net lines expense,
administrative development and net
businesses
Productivity
Transformation
Initiative:
Downsizing and
streamlining $ - $ - $ - $ - $ 139 $ - $ - $ 6 $ 145
of worldwide
operations
Accelerated
depreciation
and 102 8 - - - - - - 110
asset
impairment
Process
standardization - 5 - - - - 32 37
implementation
costs
102 13 - - 139 - - 38 292
-
Other:
Litigation - - - - - 14 - - 14
settlement
Insurance - - - - - - - (11) (11)
recovery
Product - - - - - - - 15 15
liability
Upfront and
milestone
payments and
acquired in- - - 162 230 - - - - 392
process
research and
development
Auction rate
securities - - - - - - - 275 275
impairment
Downsizing and
streamlining - - - - 44 - - - 44
of worldwide
operations
Accelerated
depreciation,
asset 77 - - - - - - 23 100
impairment and
contract
termination
Gain on sale of
properties
and product - - - - - - (273) (9) (282)
lines and
businesses
$179 $13 $162 $230 $183 $14 $(273) $331 839
Income taxes on (33)
items above
Change in
estimate for
taxes (39)
on a prior year
item
Decrease to Net Earnings from Continuing Operations $767
BRISTOL-MYERS SQUIBB COMPANY
RECONCILIATION OF GAAP RESULTS OF CONTINUING OPERATIONS
TO NON-GAAP RESULTS OF CONTINUING OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31, 2008 AND 2007
(Unaudited, amounts in millions except per share data)
Q4 2008 Non Q4 2007 Non
GAAP Specified GAAP GAAP Specified GAAP
Items* Items*
Net Sales $ 5,249 $ 5,249 $ 5,058 $ 5,058
Cost of Products 1,522 (42 ) 1,480 1,716 (133 ) 1,583
Sold
Gross Profit 3,727 42 3,769 3,342 133 3,475
Gross Margin as a 71.0 % 0.8 % 71.8 % 66.1 % 2.6 % 68.7 %
% of Sales
Marketing Selling 1,285 (76 ) 1,209 1,256 (13 ) 1,243
and Admin
Advertising and 449 - 449 465 - 465
Product Promotion
Total SGA 1,734 (76 ) 1,658 1,721 (13 ) 1,708
SG&A as a % of 33.0 % (1.4 )% 31.6 % 34.0 % (0.2 )% 33.8 %
Sales
R&D 1,143 (273 ) 870 889 (5 ) 884
R&D as a % of 21.8 % (5.2 )% 16.6 % 17.6 % (0.1 )% 17.5 %
Sales
Acquired
in-process - - - 230 (230 ) -
research and
development
Provision for
restructuring, 151 (151 ) - 139 (139 ) -
net
Litigation 1 (1 ) - - - -
expense, net
Gain (Loss) on
sale of product (159 ) 159 - - - -
lines and
businesses
Equity in Net
Income of (139 ) - (139 ) (131 ) - (131 )
Affiliates
Other
(income)/expense, (892 ) 870 (22 ) 322 (337 ) (15 )
net
Earnings from
Continuing 1,
Operations Before $ 1,888 (486 ) $ 402 $ 172 857 $ 1,029
Minority
Interest & Taxes
Provision for 424 (193 ) 231 147 70 217
income taxes
Minority
Interest, net of 266 - 266 217 - 217
taxes
Net Earnings/
(Loss) - 1,198 (293 ) 905 (192 ) 787 595
Continuing
Operations
Net Earnings - 46 - 46 103 - 103
Discontinued Ops
Net Earnings/ $ 1,244 (293 ) $ 951 $ (89 ) 787 $ 698
(Loss)
Interest Exp on
Conv. Of Conv - - - 10
Debt Bonds
Net Earnings/
(Loss) used for
Diluted EPS Calc $ 1,198 (293 ) $ 905 $ (192 ) $ 605
-
Continuing
Operations.
Avg Shares 1,982 - 1,982 1,975 2,014
(Diluted)
Diluted EPS -
Continuing $ 0.61 (0.15 ) $ 0.46 $ (0.10 ) 0.40 $ 0.30
Operations
Net Earnings -
Continuing 22.8 % (5.6 )% 17.2 % (3.8 )% 15.6 % 11.8 %
Operations as a %
Of sales
Effective Tax 22.5 % (6.0 )% 16.5 % 85.5 % (64.4 )% 21.1 %
Rate
* Please refer to the Specified Items schedules
for further details.
BRISTOL-MYERS SQUIBB COMPANY
RECONCILIATION OF GAAP RESULTS OF CONTINUING OPERATIONS
TO NON-GAAP RESULTS OF CONTINUING OPERATIONS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2008 AND 2007
(Unaudited, amounts in millions except per share data)
YTD 2008 Non YTD2007 Non
GAAP Specified GAAP GAAP Specified GAAP
Items* Items*
Net Sales $ 20,597 $ 20,597 $ 18,193 $ 18,193
Cost of Products 6,396 (249 ) 6,147 5,868 (179 ) 5,689
Sold
Gross Profit 14,201 249 14,450 12,325 179 12,504
Gross Margin as a 68.9 % 1.3 % 70.2 % 67.7 % 1.0 % 68.7 %
% of Sales
Marketing Selling 4,792 (150 ) 4,642 4,516 (13 ) 4,503
and Admin
Advertising and 1,550 - 1,550 1,415 - 1,415
Product Promotion
Total SGA 6,342 (150 ) 6,192 5,931 (13 ) 5,918
SG&A as a % of 30.8 % (0.7 %) 30.1 % 32.6 % (0.1 )% 32.5 %
Sales
R&D 3,585 (361 ) 3,224 3,227 (162 ) 3,065
R&D as a % of 17.4 % (1.7 %) 15.7 % 17.7 % (0.9 )% 16.8 %
Sales
Acquired
in-process 32 (32 ) - 230 (230 ) -
research and
development
Provision for
restructuring, 218 (218 ) - 183 (183 ) -
net
Litigation 33 (33 ) - 14 (14 ) -
expense, net
Gain on sale of
product lines and (159 ) 159 - (273 ) 273 -
businesses
Equity in Net
Income of (617 ) - (617 ) (524 ) - (524 )
Affiliates
Other
(income)/expense, (704 ) 614 (90 ) 351 (331 ) 20
net
Earnings from
Continuing
Operations Before $ 5,471 270 $ 5,741 $ 3,186 839 $ 4,025
Minority
Interest & Taxes
Provision for 1,320 (39 ) 1,281 682 72 754
income taxes
Minority
Interest, net of 996 - 996 763 - 763
taxes
Net Earnings -
Continuing 3,155 309 3,464 1,741 767 2,508
Operations
Net Earnings - 2,092 - 2,092 424 - 424
Discontinued Ops
Net Earnings $ 5,247 309 $ 5,556 $ 2,165 767 $ 2,932
Interest Exp on
Conv. Of Conv 16 - 16 - - 38
Debt Bonds
Net Earnings used
for Diluted EPS $ 3,171 309 $ 3,480 $ 1,741 $ 2,546
Calc - Continuing
Operations.
Avg Shares 2,001 2,001 1,980 2,009
(Diluted)
Diluted EPS -
Continuing $ 1.59 0.15 $ 1.74 $ 0.88 0.39 $ 1.27
Operations
Net Earnings -
Continuing 15.3 % 1.5 % 16.8 % 9.6 % 4.2 % 13.8 %
Operations as a %
of sales
Effective Tax 24.1 % (1.8 %) 22.3 % 21.4 % (2.7 )% 18.7 %
Rate
* Please refer to the Specified
Items schedules for further details
BRISTOL-MYERS SQUIBB COMPANY
NET DEBT CALCULATION
AS OF DECEMBER 31, 2008 AND SEPTEMBER 30, 2008
(Unaudited, dollars in millions)
December 31, 2008 September 30, 2008
Cash and cash equivalents $ 7,976 $ 7,173
Marketable securities-current 289 258
Short-term borrowings (154 ) (135 )
Long-term debt (6,585 ) (6,120 )
Net cash $ 1,526 $ 1,176
CONTACT: Bristol-Myers Squibb Company
Communications:
Brian Henry, 609-252-3337
Tracy Furey, 609-252-3208
or
Investor Relations:
John Elicker, 609-252-4611
Suketu Desai, 609-252-5796
Source: Bristol-Myers Squibb Company
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