Abbott 3Q16 Earnings Call Notes

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Abbott Laboratories’ (ABT) CEO Miles White on Q3 2016 Results

China in transition

“I will try to. I would say the market in China has been in a bit of a transition for a number of months, it would appear, maybe other even more. And it depends on who you are and what channels you are in and so forth, depending how it affects you. We expected this year to see 7% to 8% growth in China, slightly above the GDP growth, et cetera and what we are seeing now is flat to low single digits and I think some of our competitors have reported the same. So we have gotten some triangulation on just underlying market growth rate but beyond that, a number of dynamics are at work there.”

Inventories have piled up in traditional channels in China

“There’s some pretty rapid channel shift from traditional channels, like modern trade to various e-commerce channels and so forth. And I don’t think that’s surprised anybody in terms of just overall trends. But the speed and magnitude of it, I think, has hit China differently than what you would see in the U.S. or other countries. And so that’s been a pretty big chunk. In the process of that, what’s happened is, some inventories have piled up in, let’s say, traditional channels while the market’s needs have been satisfied by e-commerce channels. And so the market has got to burn through that, I guess, to some degree.”

US having a better year than we planned

” If you look at the U.S., which I think everybody has become accustomed to sort of ignoring in the numbers, the U.S. is having a better year than planned, better year than in a long time and it’s better than solid. So there’s a lot of thing happening that offset China, to some degree.”

Brian Yoor

Full year EPS guidance $2.19-$2.21

“Turning to our outlook for the full year 2016. We narrowed our adjusted earnings per share guidance range to $2.19 to $2.21. The midpoint of our guidance range reflects double-digit underlying growth offset by the impact of foreign exchange on our operating results.”