Johnson and Johnson 2009 Annual Report Download - page 70

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Reconciliation of Non-GAAP Financial Measures
68 R E C O N C I L I A T I O N O F N O N - G A A P F I N A N C I A L M E A S U R E S
The tables below are provided to reconcile certain financial disclosures in the Letter to Shareholders, page 1.
’09 vs. ’08 ’08 vs. ’07
(Dollars in Millions Except Per Share Data) 2009 2008 2007 % Change % Change
Earnings before provision for taxes on income — as reported $15,755 16,929 13,283 (6.9)% 27.4
Purchased in-process research & development (IPR&D) —181 807
Net gain on fourth quarter litigation (386) (379) —
Restructuring expense 1,186 —745
NATRECOR® intangible asset write-down ——678
Earnings before provision for taxes on income — as adjusted $16,555 16,731 15,513 (1.1)% 7.9
Net Earnings — as reported $12,266 12,949 10,576 (5.3)% 22.4
Purchased in-process research & development (IPR&D) —181 807
Net gain on fourth quarter litigation (212) (229) —
Restructuring expense 852 —528
NATRECOR® intangible asset write-down ——441
International tax gain on restructuring ——(267)
Net Earnings — as adjusted $12,906 12,901 12,085 0.0% 6.8
Diluted net earnings per share — as reported $ 4.40 4.57 3.63 (3.7)% 25.9
Purchased in-process research & development (IPR&D) —0.06 0.28
Net gain on fourth quarter litigation (0.08) (0.08) —
Restructuring expense 0.31 —0.18
NATRECOR® intangible asset write-down ——0.15
International tax gain on restructuring ——(0.09)
Diluted net earnings per share — as adjusted $ 4.63 4.55 4.15 1.8% 9.6
’09 vs. ’08 ’08 vs. ’07
(Dollars in Millions) 2009 2008 2007 % Change % Change
Net cash flows from operating activities $16,571 14,972 15,022
Additions to property, plant and equipment (2,365) (3,066) (2,942)
Free Cash Flow $14,206 11,906 12,080 19.3 (1.4)
The Company believes investors gain additional perspective of underlying business trends and results by providing free cash flow, a measure
of earnings before tax, net earnings and diluted net earnings per share that excludes IPR&D charges and other special items in order to eval-
uate ongoing business operations. These non-GAAP financial measures should not be considered replacements for, and should be read
together with, the most comparable GAAP financial measures.