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55
ABBOTT 2015 ANNUAL REPORT
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Remaining costs, if any, are not allocated to segments. In addition,
intangible asset amortization is not allocated to operating segments,
and intangible assets and goodwill are not included in the measure
of each segment’s assets. The following segment information has
been prepared in accordance with the internal accounting policies
of Abbott, as described above, and are not presented in accordance
with generally accepted accounting principles applied to the
consolidated financial statements.
(inmillions)
Net Sales to External
Customers (a) Operating Earnings (a)
2015 2014 2013 2015 2014 2013
Established
Pharmaceuticals $÷3,720 $÷3,118 $÷2,862 $÷«658 $÷«624 $÷«551
Nutritionals 6,975 6,953 6,740 1,741 1,459 1,263
Diagnostics 4,646 4,721 4,545 1,171 1,079 1,008
Vascular 2,792 2,986 3,012 1,061 1,091 962
Total Reportable
Segments 18,133 17,778 17,159 $4,631 $4,253 $3,784
Other 2,272 2,469 2,498
Total $20,405 $20,247 $19,657
(a) Net sales and operating earnings were unfavorably aected by the relatively stronger U.S.
dollar in 2015, 2014 and 2013.
(inmillions) 2015 2014 2013
Total Reportable Segment
Operating Earnings $4,631 $4,253 $3,784
Corporate functions and benefit
plans costs (416) (342) (514)
Non-reportable segments 268 439 430
Net interest expense (58) (73) (78)
Net loss on extinguishment of debt — (18) —
Share-based compensation (291) (239) (254)
Amortization of intangible assets (601) (555) (588)
Other, net (b) (350) (947) (739)
Earnings from Continuing
Operations before Taxes $3,183 $2,518 $2,041
(b) Other, net includes: charges for restructuring actions and other cost reduction initiatives
of approximately $310million in 2015, $435million in 2014 and $350million in 2013. 2015
includes a $207million pre-tax gain on the sale of a portion of the Mylan N.V. shares.
NOTE15—SEGMENT AND GEOGRAPHIC AREA INFORMATION
Abbott’s principal business is the discovery, development, manu-
facture and sale of a broad line of health care products. Abbott’s
products are generally sold directly to retailers, wholesalers,
hospitals, health care facilities, laboratories, physicians’ oces
and government agencies throughout the world. On February27,
2015, Abbott completed the sale of its developed markets branded
generics pharmaceuticals business to Mylan. This business was
previously included in the Established Pharmaceutical Products
segment. The segment information below, including prior period
amounts, has been adjusted to reflect the classification of the
developed markets branded generics pharmaceuticals business
aspart of discontinued operations in the Consolidated Statement
of Earnings. Abbott’s reportable segments are as follows:
Established Pharmaceutical Products—International sales of a
broad line of branded generic pharmaceutical products.
Nutritional Products—Worldwide sales of a broad line of adult
andpediatric nutritional products.
Diagnostic Products—Worldwide sales of diagnostic systems and
tests for blood banks, hospitals, commercial laboratories and
alternate-care testing sites. For segment reporting purposes, the
Core Laboratories Diagnostics, Molecular Diagnostics, Point of
Care and Ibis diagnostic divisions are aggregated and reported
asthe Diagnostic Products segment.
Vascular Products—Worldwide sales of coronary, endovascular,
structural heart, vessel closure and other medical device products.
For segment reporting purposes, the Vascular and Electrophysiology
Products divisions are aggregated and reported as the Vascular
Products segment.
Non-reportable segments include the Diabetes Care and Medical
Optics segments.
Abbott’s underlying accounting records are maintained on a legal
entity basis for government and public reporting requirements.
Segment disclosures are on a performance basis consistent with
internal management reporting. The cost of some corporate func-
tions and the cost of certain employee benefits are charged to
segments at predetermined rates that approximate cost.
(inmillions)
Depreciation (c) Additions to Long-term Assets Total Assets
2015 2014 2013 2015 2014 2013 2015 2014 2013
Established Pharmaceuticals $÷83 $÷72 $÷63 $÷«112 $÷«136 $÷«128 $2,210 $÷2,244 $1,445
Nutritionals 157 173 190 142 174 340 3,187 3,435 3,518
Diagnostics 310 314 368 321 349 394 2,844 2,964 3,312
Vascular 74 84 122 32 28 62 1,536 1,529 1,711
Total Reportable Segments 624 643 743 607 687 924 $9,777 $10,172 $9,986
Other 247 275 185 747 4,603 981
Total $871 $918 $928 $1,354 $5,290 $1,905
(c) Amounts in Other for years 2014 and 2013 include depreciation related to discontinued operations.