Cost of Products Sold)
42.3%Income from Operations
20.3%Results under U.S. Generally Accepted Accounting Principles (GAAP) include items as detailed in the schedules attached to this press release.
Net sales were $966 million in the first quarter of 2012, a decrease of 4 percent compared to the first quarter of 2011. The decrease is due primarily to a difficult year-over-year comparison related to the first-quarter 2011 U.S. launch of the generic oncolytic docetaxel, as well as the adverse impact to supply of the company's quality-improvement and remediation initiatives.
Adjusted* income from operations decreased 49 percent to $104 million in the first quarter of 2012, compared to $203 million in the first quarter of 2011. The majority of the decline reflects the decrease in net sales as well as the impact of costs associated with certain quality actions and inventory losses. Operating costs also increased in the first quarter of 2012 due to expected higher research and development spending, as well as higher selling and promotional costs.
The effective tax rate on an adjusted basis* in the quarter was 19.0 percent compared to 23.0 percent in the first quarter of 2011. The decrease is primarily due to lower operating income in higher-tax-rate jurisdictions.
Cash Flow Cash flow from operations for the first quarter of 2012 was $87 million compared to $6 million in the first quarter of 2011. The increase is a result of lower investments in working capital, offset by lower net income in the first quarter of 2012.
Capital expenditures were $67 million for the first quarter of 2012, compared to $62 million for the same period in 2011. The increase was mainly due to the company's manufacturing capacity expansion initiatives in Vizag, India.
2012 Projections Hospira is maintaining guidance for net sales
|SOURCE Hospira, Inc.|
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