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| Wyeth Reports Earnings Results for the 2008 Full Year and Fourth Quarter |
- Worldwide Net Revenue Increased 2% and Increased 1% Excluding the Impact of Foreign Exchange for the 2008 Full Year - Worldwide Net Revenue Decreased 7% and Decreased 1% Excluding the Impact of Foreign Exchange for the 2008 Fourth Quarter - Full Year Net Revenue Increase Led by Growth in Excess of 10% for Prevnar, Zosyn and Nutritional Products and 27% Growth for Enbrel " Product Highlights for the 2008 Fourth Quarter and Full Year The following table presents worldwide net revenue from
(UNAUDITED)
-----------
Full Year
Three Months Ended 12/31/2008 Ended 12/31/2008 (2)
----------------------------- --------------------
Increase/
(Decrease)
Principal $ in Increase/ Excluding $ in Increase/
Products millions (Decrease) FX millions (Decrease)
--------- -------- ---------- ---------- -------- ----------
Effexor $902 (7)% (3)% $3,928 4%
Prevnar 603 8% 18% 2,716 11%
Enbrel
Outside U.S.
and Canada 598 6% 22% 2,593 27%
Alliance Revenue -
U.S. and Canada 301 13% 13% 1,205 20%
Nutritionals 385 (2)% 7% 1,634 13%
Zosyn/Tazocin 298 2% 8% 1,264 11%
Premarin family 261 (1)% 1% 1,070 1%
Protonix family(1) 185 (60)% (60)% 806 (58)%
Centrum 170 (17)% (11)% 728 3%
Advil 171 (8)% (4)% 673 (2)%
(1) Protonix family net revenue for the 2008 fourth quarter and full year
reflects revenue from both the branded product,
2008 Fourth Quarter Results Net revenue decreased 7% for the 2008 fourth quarter and decreased 1%
excluding the impact of foreign exchange as compared with the 2007 fourth
quarter. The 1% decrease excluding the impact of foreign exchange was
primarily due to lower sales of the PROTONIX(R) family, EFFEXOR(R) and
Consumer Healthcare products, which were offset by increases in Gross margin, as a percentage of net revenue, excluding certain significant items, increased 3.2 percentage points to 74.9% from 71.7% for the 2008 fourth quarter. The increase was primarily due to product mix and the favorable impact of foreign exchange rates on Cost of goods sold during the quarter. Excluding this impact of foreign exchange, gross margin would have been approximately 72.4% in the 2008 fourth quarter. Selling, general and administrative expenses, excluding certain significant items, decreased 14% for the 2008 fourth quarter and decreased 9% excluding the impact of foreign exchange versus the 2007 fourth quarter, primarily due to the realization of cost savings as a result of Project Impact. Research and development expenses, excluding certain significant items, increased 2% for the 2008 fourth quarter versus the 2007 fourth quarter due to higher late-stage clinical trial spending, as well as increased licensing and acquisition costs. Other expense, net for the 2008 fourth quarter primarily included costs associated with our foreign exchange hedging program and losses on investments, which were partially offset by royalty income and product divestitures. The Company's tax rate for the 2008 fourth quarter, excluding certain
significant items, decreased to 23.3% from 25.8% in the 2007 fourth quarter.
The decrease in the tax rate for the 2008 fourth quarter versus the 2007
fourth quarter was due primarily to the realization of the benefits of the
Net income and diluted earnings per share for the 2008 fourth quarter were
2008 Full Year Results Net revenue increased 2% for the 2008 full year and increased 1% excluding
the impact of foreign exchange as compared with the 2007 full year. The
increase of 1% excluding the impact of foreign exchange was primarily driven
by Selling, general and administrative expenses, excluding certain significant items, for the 2008 full year decreased 3% and decreased 4% excluding the impact of foreign exchange versus the 2007 full year due to cost savings realized from Project Impact. Research and development expenses, excluding certain significant items, for the 2008 full year increased 3% versus the 2007 full year due to higher late-stage clinical trial spending. Other expense, net, excluding certain significant items, for the 2008 full
year primarily included costs associated with our foreign exchange hedging
program and losses on investments, which were partially offset by royalty
income and product divestitures. Net investment write-downs amounted to
approximately The Company's tax rate for the 2008 full year, excluding certain significant items, increased to 30.0% from 28.5% for the 2007 full year. This increase resulted primarily from higher sales of certain pharmaceutical products that are manufactured in less favorable tax jurisdictions and increased expenditures in countries with lower tax rates. Net income and diluted earnings per share for the 2008 full year were
To assist in performing fourth quarter and full year comparisons, a presentation, which excludes our productivity initiatives, is provided under "Results of Operations - As Adjusted." 2009 Economic Conditions The global economic conditions today are impacting the operations of most large multi-national companies. It is expected that our 2009 results compared with 2008 will be adversely impacted by: -- the unfavorable year to year negative impact of foreign exchange,
which will be partially offset by the hedging program we have in place
for certain currencies,
-- the decline in the market value of pension assets, which will increase
pension expense by approximately
As a result of the announced merger agreement between Pfizer and
Results of Operations
The comparative results of operations are as follows:
(In thousands except per share amounts)
(UNAUDITED)
-----------
Three Months Ended Full Year Ended
------------------ ---------------
12/31/2008 12/31/2007 12/31/2008 12/31/2007
---------- ---------- ---------- ----------
Net Revenue $5,348,319 $5,763,526 $22,833,908 $22,399,798
Cost of Goods Sold 1,430,350 1,691,418 6,247,767 6,313,687
Selling, General and
Administrative Expenses 1,647,927 1,882,476 6,838,359 6,753,698
Research and Development
Expenses 898,012 882,466 3,373,213 3,256,785
Interest (Income) Expense,
Net 20,760 (17,071) 24,942 (90,511)
Other (Income) Expense,
Net 97,824 (38,795) 11,540 (290,543)
------ ------- ------ --------
Income before Income
Taxes 1,253,446 1,363,032 6,338,087 6,456,682
Provision for Income
Taxes 293,061 345,602 1,920,254 1,840,722
------- ------- --------- ---------
Net Income $960,385 $1,017,430 $4,417,833 $4,615,960
======== ========== ========== ==========
Basic Earnings per Share $0.72 $0.76 $3.31 $3.44
===== ===== ===== =====
Average Number of Common
Shares Outstanding during
Each Period - Basic 1,331,519 1,338,559 1,333,033 1,342,552
Diluted Earnings per Share $0.71 $0.75 $3.27 $3.38
===== ===== ===== =====
Average Number of Common
Shares Outstanding during
Each Period - Diluted 1,353,169 1,367,895 1,357,466 1,374,342
See Notes to Results of Operations.
Results of Operations - As Adjusted
The comparative results of operations - as adjusted are as follows:
(In thousands except per share amounts)
(UNAUDITED) - AS ADJUSTED
-------------------------
Three Months Ended Full Year Ended
------------------ ---------------
12/31/2008 12/31/2007 12/31/2008 12/31/2007
---------- ---------- ---------- ----------
Net Revenue $5,348,319 $5,763,526 $22,833,908 $22,399,798
Cost of Goods Sold 1,344,239 1,629,443 6,005,322 6,069,333
Selling, General and
Administrative Expenses 1,620,051 1,880,580 6,542,268 6,724,921
Research and Development
Expenses 896,399 882,437 3,340,084 3,256,516
Interest (Income) Expense,
Net 20,760 (17,071) 24,942 (90,511)
Other (Income) Expense,
Net 97,824 (38,795) 116,195 (290,543)
------ ------- ------- --------
Income before Income
Taxes 1,369,046 1,426,932 6,805,097 6,730,082
Provision for Income
Taxes 319,661 367,602 2,038,334 1,919,722
------- ------- --------- ---------
Net Income $1,049,385 $1,059,330 $4,766,763 $4,810,360
========== ========== ========== ==========
Basic Earnings per Share $0.79 $0.79 $3.58 $3.58
===== ===== ===== =====
Average Number of Common
Shares Outstanding during
Each Period - Basic 1,331,519 1,338,559 1,333,033 1,342,552
Diluted Earnings per Share $0.78 $0.78 $3.53 $3.52
===== ===== ===== =====
Average Number of Common
Shares Outstanding during
Each Period - Diluted 1,353,169 1,367,895 1,357,466 1,374,342
See Notes to Results of Operations.
Notes to Results of Operations
(1) The average number of common shares outstanding for diluted earnings
per share is higher than for basic earnings per share due to the
assumed conversion of the Company's outstanding convertible senior
debentures, outstanding stock options, deferred contingent common
stock awards, performance share awards, restricted stock awards and
convertible preferred stock into common stock equivalents using the
treasury stock method. For purposes of calculating diluted earnings
per share, interest expense, net of capitalized interest and taxes
related to the Company's outstanding convertible senior debentures is
added back to reported net income, and the additional shares of common
stock (assuming conversion) are included in total shares outstanding.
Interest expense, net of capitalized interest and taxes related to
these debentures was
(4) The following table presents worldwide net revenue by reportable
segment, together with the percentage changes from the comparable
periods in the prior year, as reported and without the impact of
foreign exchange:
(UNAUDITED)
-----------
Full Year
Three Months Ended 12/31/2008 Ended 12/31/2008(a)
----------------------------- -------------------
Increase/
Net Revenue by (Decrease)
Reportable ($ in Increase/ Excluding ($ in Increase/
Segment millions) (Decrease) FX millions) (Decrease)
-------------- --------- ---------- ---------- --------- ----------
Pharmaceuticals $4,409 (7)% (1)% $19,025 2%
Consumer
Healthcare 702 (11)% (5)% 2,721 (1)%
Animal
Health 237 (6)% 2% 1,088 4%
--- -- -- ----- --
Consolidated
Total $5,348 (7)% (1)% $22,834 2%
====== == == ======= ==
(a) The impact of foreign exchange was not significant for the 2008 full year percentage change. Additional information regarding The Company will not hold its conference call previously scheduled for
The statements in this press release that are not historical facts,
including the discussion under the heading "2009 Economic Conditions," are
forward-looking statements that are subject to risks and uncertainties that
could cause actual results to differ materially from those expressed or
implied by such statements. In particular, if the assumptions underlying the
discussion under the heading "2009 Economic Conditions" prove incorrect, our
actual results could differ materially. Risks and uncertainties that could
cause actual results to differ materially from those expressed or implied by
forward-looking statements include, without limitation, the inherent
uncertainty of the timing and success of, and expense associated with,
research, development, regulatory approval and commercialization of our
products and pipeline products; government cost-containment initiatives;
restrictions on third-party payments for our products; substantial competition
in our industry, including from branded and generic products; emerging data on
our products and pipeline products; the importance of strong performance from
our principal products and our anticipated new product introductions; the
highly regulated nature of our business; product liability, intellectual
property and other litigation risks and environmental liabilities; uncertainty
regarding our intellectual property rights and those of others; difficulties
associated with, and regulatory compliance with respect to, manufacturing of
our products; risks associated with our strategic relationships; economic
conditions including interest and currency exchange rate fluctuations; changes
in generally accepted accounting principles; trade buying patterns; the impact
of legislation and regulatory compliance; risks and uncertainties associated
with global operations and sales; and other risks and uncertainties, including
those detailed from time to time in our periodic reports filed with the
Also, for recent announcements and additional information, including product sales information, please refer to the Company's Internet Web site.
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