Abbott reports strong first quarter

ABBOTT PARK -- Abbott's broad portfolio of businesses and expanding global operations generated outstanding 2007 results, and its new product pipeline provides a foundation for continued growth as demonstrated by the company's strong first-quarter performance, Chairman and Chief Executive Officer Miles D. White told shareholders Friday at the company's annual meeting.

"2007 was an outstanding year for Abbott across all of our major businesses, and our strong momentum has carried into 2008," White said. "We delivered another year of strong sales and profitability. We expanded our business in important emerging economies such as China, India, Russia and Latin America. And we were highly productive in building our pipeline, providing the basis for a steady new product stream and continued future success."

White conceded frustration with Abbott's stock price, which is off 10 percent this year. But he reminded the 1,200 shareholders in attendance that Abbott's shares have outperformed the broader pharmaceutical industry, which has been plagued by looming patent expirations and a dearth of new products.

The firm's stock has fared slightly better than the S&P Health Care Index, which is off 11 percent. Abbott shares gained 15 percent last year. They ended the day up 84 cents to $51.28 Friday.

Abbott predicts it will get U.S. Food & Drug Administration approval in the second quarter to begin marketing the stent, a tiny metal coil used to prop open heart arteries after they're cleared. But investors are leery that recent safety concerns over the use of drug-coated stents could delay regulatory approval.

For 2007, Abbott's net earnings rose 110 percent to $3.61 billion, or $2.31 per share, from the previous year, when profits were weighed down by acquisition expenses. Revenue grew 15.3 percent to $25.91 billion.

"The diversity and balance of our business base is our core strength and Abbott's greatest differentiator," White said. "Our continued strong growth through the challenges that face medical technology innovators speaks to our ability to adapt, execute and optimize the many prospects that our mix of businesses provides."

While the United States remains Abbott's single largest market, the company's growing international business has been central to its performance. For the first time in Abbott's 120-year history, the company's mix of total revenues in 2007 favored its international business.

In 2007, Abbott's diabetes care sales increased 18 percent internationally; international nutritionals grew 18 percent; the international pharmaceutical business delivered sales growth of nearly 17 percent; and diagnostics enjoyed strong growth in Europe, Latin America and Japan.

A major component of Abbott's success is the innovation of new products to serve patients. Abbott plans a record number of new product introductions in 2008.

White said the company is also conducting highly innovative research and development work across its range of medical products, nutritional and pharmaceutical businesses.

During the meeting, shareholders rejected proposals calling for a non-binding vote on executive compensation and access to medicines. In addition, the shareholders ratified the selection of Deloitte & Touche LLP as auditors of the corporation for 2008.

Shareholders Friday also voted down a resolution brought by faith-based institutional investors that would have given shareholders a non-binding vote on executives' pay.

Abbott's 13 incumbent directors were elected to the board of directors during the annual meeting.