AbbVie 2012 Annual Report Download - page 50

reflected in Due to Abbott Laboratories and Due from Abbott Laboratories on the combined balance
sheet.
AbbVie’s historical financial statements included an allocation of expenses related to certain Abbott
corporate functions, including senior management, legal, human resources, finance, information
technology, and quality assurance. These expenses have been allocated to AbbVie based on direct
usage or benefit where identifiable, with the remainder allocated on a pro rata basis of revenues,
headcount, square footage, number of transactions or other measures. AbbVie considers the expense
allocation methodology and results to be a reasonable reflection of the utilization of services provided
to, or the benefit received by, the company during the periods presented. The allocations may not,
however, reflect the expense the company would have incurred as an independent, publicly-traded
company for the periods presented. Subsequent to the separation, AbbVie expects to incur additional
costs associated with being an independent, publicly-traded company, primarily from higher charges
than in the past from Abbott for various services that will continue to be provided on a transition basis
and from newly established or expanded corporate functions. AbbVie expects to incur one-time costs
primarily to establish certain stand-alone AbbVie functions and information technology systems, further
establish its infrastructure outside the United States and to complete the separation in certain
countries. A portion of these expenditures will be capitalized and depreciated over the assets’ useful
lives while the remainder will be expensed as incurred, depending on the nature of the cost. AbbVie
believes that cash flows from operations will be sufficient to fund these additional corporate expenses.
The historical financial statements do not necessarily include all of the expenses that would have been
incurred had AbbVie been a separate, stand-alone entity and may not necessarily reflect AbbVie’s
results of operations, financial position and cash flows had AbbVie been a stand-alone company during
the periods presented. Refer to Note 13 for further description of transactions between AbbVie and
Abbott.
RESULTS OF OPERATIONS
Net Sales
Percent change
At actual At constant
currency currency
rates rates
for the years ended (in millions) 2012 2011 2010 2012 2011 2012 2011
United States $10,435 $ 9,712 $ 8,971 7% 8% 8% 8%
International 7,945 7,732 6,667 3% 16% 8% 12%
Net sales $18,380 $17,444 $15,638 5% 12% 8% 9%
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