Abbott Laboratories 2013 Annual Report Download - page 71

ABBOTT 2013 ANNUAL REPORT
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has utilized factoring arrangements to mitigate credit risk
although the receivables included in such arrangements have
historically not been a material amount of total outstanding
receivables. If government funding were to become unavailable
in these countries or if significant adverse changes in their
reimbursement practices were to occur, Abbott may not be able
to collect the entire balance.
CAPITAL EXPENDITURES
Capital expenditures of $1.1 billion in 2013, $1.8 billion in 2012 and
$1.5 billion in 2011 were principally for upgrading and expanding
manufacturing and research and development facilities and equip-
ment in various segments, investments in information technology,
and laboratory instruments placed with customers. The 2013
decrease reflects the separation of AbbVie at the beginning of 2013.
CONTRACTUAL OBLIGATIONS
The table below summarizes Abbott’s estimated contractual
obligations as of December 31, 2013.
Substantially all of Abbott’s trade receivables in Italy, Spain,
Portugal, and Greece are with governmental health systems.
The collection of outstanding receivables in these countries
held steady or improved in 2013 depending upon the country.
As a result, governmental receivables in these four countries
accounted for approximately 1 percent of Abbott’s total assets
and 12 percent of total net trade receivables as of December 31,
2013. The latter is down from 16 percent as of December 31 2012.
With the exception of Greece, Abbott historically has collected
almost all of the outstanding receivables in these countries. Abbott
continues to monitor the credit worthiness of customers located
in these and other geographic areas and establishes an allowance
against a trade receivable when it is probable that the balance
will not be collected. In addition to closely monitoring economic
conditions and budgetary and other fiscal developments in these
countries, Abbott regularly communicates with its customers
regarding the status of receivable balances, including their pay-
ment plans and obtains positive confirmation of the validity of the
receivables. Abbott also monitors the potential for and periodically
FINANCIAL REVIEW
(in millions) Payments Due By Period
2019 and
Total 2014 2015-2016 2017-2018 Thereafter
Long-term debt, including current maturities $ 3,397 $ 9 $ 13 $ 2 $3,373
Interest on debt obligations 2,977 181 350 349 2,097
Operating lease obligations 628 140 219 131 138
Capitalized auto lease obligations 40 13 27 — —
Purchase commitments (a) 2,295 2,118 158 15 4
Other long‑term liabilities 1,272 — 771 354 147
Total (b) $10,609 $2,461 $1,538 $ 851 $5,759
(a) Purchase commitments are for purchases made in the normal course of business to meet operational and capital expenditure requirements.
(b) Unrecognized tax benefits totaling $1.3 billion are excluded from the table above as Abbott is unable to reasonably estimate the period of cash settlement with the respective taxing authorities on
such items. See Note 13 – Taxes on Income for further details. The company has employee benefit obligations consisting of pensions and other postemployment benefits, including medical and life,
which have been excluded from the table. A discussion of the company’s pension and postretirement plans, including funding matters is included in Note 12 – Post‑employment Benefits.