Abbott Laboratories Net Income jumped on 93.7% in 2015 and Revenue increased slightly on 0.78%
28 Jan 2016 • About Abbott Laboratories (
$ABT) • By InTwits
Abbott Laboratories reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Abbott Laboratories has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.8%. At the same time it's a lot of higher than industry average of 1.3%.
- CAPEX is quite volatile: 1,386 in FY2015, 1,625 in FY2014, 3,030 in FY2013, 2,491 in FY2012, 1,231 in FY2011
- The company has business model with low profitability: ROIC is at 9.4%
- It operates with high leverage: Net Debt/EBITDA is 0.9x while industry average is 0.1x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Abbott Laboratories ($ABT) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 38,851 | 21,494 | 19,657 | 20,247 | 20,405 | 0.8% |
| Gross Profit | 23,311 | 11,677 | 10,464 | 11,029 | 11,658 | 5.7% |
| SG&A | 12,757 | 7,444 | 6,372 | 6,530 | 6,785 | 3.9% |
| EBITDA | 8,796 | 4,676 | 3,852 | 4,147 | 4,339 | 4.6% |
| Net Income | 4,728 | 5,963 | 2,576 | 2,284 | 4,423 | 93.7% |
Balance Sheet
|
|---|
| Cash | 6,813 | 10,802 | 3,475 | 4,063 | 5,001 | 23.1% |
| Short Term Debt | 3,375 | 2,391 | 3,173 | 4,437 | 3,130 | -29.5% |
| Long Term Debt | 12,040 | 18,085 | 3,388 | 3,393 | 5,871 | 73.0% |
Cash flow
|
|---|
| Capex | 1,492 | 1,795 | 1,145 | 1,077 | 1,110 | 3.1% |
Ratios
|
|---|
| Revenue growth | 10.5% | -44.7% | -8.5% | 3.0% | 0.8% | |
| EBITDA growth | 1.0% | -46.8% | -17.6% | 7.7% | 4.6% | |
| Gross Margin | 60.0% | 54.3% | 53.2% | 54.5% | 57.1% | 2.7% |
| EBITDA Margin | 22.6% | 21.8% | 19.6% | 20.5% | 21.3% | 0.8% |
| Net Income Margin | 12.2% | 27.7% | 13.1% | 11.3% | 21.7% | 10.4% |
| SG&A, % of revenue | 32.8% | 34.6% | 32.4% | 32.3% | 33.3% | 1.0% |
| CAPEX, % of revenue | 3.8% | 8.4% | 5.8% | 5.3% | 5.4% | 0.1% |
| ROIC | 13.8% | 4.3% | 5.3% | 8.3% | 9.4% | 1.0% |
| ROE | 20.1% | 23.3% | 9.9% | 9.8% | 20.7% | 10.9% |
| Net Debt/EBITDA | 1.0x | 2.1x | 0.8x | 0.9x | 0.9x | 0.0x |
Revenue and profitability
Abbott Laboratories's Revenue increased slightly on 0.78% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 3.3 pp from 12.4% to 15.7% in FY2015.
Gross Margin increased on 2.7 pp from 54.5% to 57.1% in 2015. SG&A as a % of Revenue increased slightly on 1.00 pp from 32.3% to 33.3% in 2015.
Net Income marign surged on 10.4 pp from 11.3% to 21.7% in 2015.
Capital expenditures (CAPEX) and working capital investments
Abbott Laboratories's CAPEX/Revenue was 5.4% in 2015. CAPEX/Revenue decreased on 2.9 pp from 8.4% in 2012 to 5.4% in 2015. Average CAPEX/Revenue for the last three years was 5.5%.
Return on investment
The company operates at good ROE (20.70%) while ROIC is low (9.38%). ROIC increased slightly on 1.0 pp from 8.3% to 9.4% in 2015. ROE surged on 10.9 pp from 9.8% to 20.7% in 2015.
Leverage (Debt)
Debt level is 0.9x Net Debt / EBITDA and 2.1x Debt / EBITDA. Net Debt / EBITDA increased slightly on 0.014x from 0.9x to 0.9x in 2015. Debt surged on 15.0% in 2015 while cash jumped on 23.1% in 2015.
Valuation
The company's trades at EV/EBITDA 1.0x and P/E 0.1x while industy averages are 10.5x and 26.1x. Abbott Laboratories's EV/(EBITDA-CAPEX) is 1.4x with the industry average at 4.7x.
Appendix 1: Peers in Health Care Equipment & Services
Below you can find Abbott Laboratories benchmarking vs. other companies in Health Care Equipment & Services industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tristel ($TSTL) | | 17.8% | -3.5% | 27.6% | 13.8% |
| Md Medical Group Invest ($MDMG) | 42.2% | 39.7% | 39.7% | 26.9% | |
| Ekf Diagnostics Holdings ($EKF) | 234.1% | 20.3% | 22.0% | 16.7% | |
| Smith & Nephew ($SN.) | 7.8% | -3.1% | 5.2% | 6.1% | |
| Lifeline Scientific Inc ($LSIC) | 9.6% | 18.7% | 10.2% | 6.0% | |
| |
|---|
| Median (10 companies) | 8.7% | 14.5% | 7.0% | 5.7% | 5.9% |
|---|
| Abbott Laboratories ($ABT) | | -44.7% | -8.5% | 3.0% | 0.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Smith & Nephew ($SN.) | 73.3% | 74.1% | 74.7% | 74.8% | |
| Tristel ($TSTL) | 63.5% | 67.9% | 66.4% | 69.8% | 69.5% |
| Immunodiagnostic Systems Hldgs ($IDH) | 74.7% | 74.7% | 73.1% | 68.1% | 62.5% |
| Omega Diagnostics Group ($ODX) | 59.6% | 63.0% | 62.6% | 63.6% | 63.4% |
| Lifeline Scientific Inc ($LSIC) | 63.8% | 60.6% | 59.8% | 61.3% | |
| |
|---|
| Median (10 companies) | 54.6% | 57.8% | 55.6% | 56.6% | 62.9% |
|---|
| Abbott Laboratories ($ABT) | 60.0% | 54.3% | 53.2% | 54.5% | 57.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Immunodiagnostic Systems Hldgs ($IDH) | 34.1% | | 35.3% | 34.1% | 23.6% |
| Md Medical Group Invest ($MDMG) | 44.4% | 41.7% | 28.0% | 28.9% | |
| Synergy Health ($SYR) | 28.0% | 26.0% | 26.4% | 25.8% | 24.3% |
| Smith & Nephew ($SN.) | 27.1% | 27.8% | 26.9% | 25.2% | |
| Tristel ($TSTL) | 11.8% | 17.0% | 13.7% | 20.1% | 22.9% |
| |
|---|
| Median (10 companies) | 15.8% | 17.0% | 14.9% | 19.1% | 23.2% |
|---|
| Abbott Laboratories ($ABT) | 22.6% | 21.8% | 19.6% | 20.5% | 21.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Md Medical Group Invest ($MDMG) | 62.3% | 65.2% | 42.8% | 43.4% | |
| Puricore ($PURI) | 1.5% | 2.4% | 3.2% | 15.4% | |
| Synergy Health ($SYR) | 13.1% | 15.2% | 13.2% | 10.3% | 15.1% |
| Bioquell ($BQE) | 9.6% | 7.6% | 8.8% | 8.9% | |
| Smith & Nephew ($SN.) | 7.5% | 6.4% | 7.8% | 8.1% | |
| |
|---|
| Median (10 companies) | 8.5% | 5.7% | 4.5% | 6.6% | 6.1% |
|---|
| Abbott Laboratories ($ABT) | 3.8% | 8.4% | 5.8% | 5.3% | 5.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tristel ($TSTL) | 4.0% | 6.5% | 3.5% | 15.9% | 20.1% |
| Smith & Nephew ($SN.) | 25.5% | 22.0% | 18.6% | 14.7% | |
| Immunodiagnostic Systems Hldgs ($IDH) | 21.7% | | | 12.3% | 4.3% |
| Lifeline Scientific Inc ($LSIC) | 12.1% | 1.9% | 11.2% | 11.7% | |
| Md Medical Group Invest ($MDMG) | 45.2% | 19.9% | 9.5% | 11.0% | |
| |
|---|
| Median (10 companies) | 10.7% | 6.5% | 7.9% | 10.0% | 6.7% |
|---|
| Abbott Laboratories ($ABT) | 13.8% | 4.3% | 5.3% | 8.3% | 9.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Md Medical Group Invest ($MDMG) | 0.8x | 0.2x | 0.2x | 2.0x | |
| Synergy Health ($SYR) | 1.4x | 2.1x | 1.9x | 1.5x | 1.6x |
| Smith & Nephew ($SN.) | 0.1x | 0.3x | 0.2x | 1.4x | |
| Bioquell ($BQE) | -0.5x | -0.2x | -0.3x | -0.3x | |
| Lifeline Scientific Inc ($LSIC) | -3.6x | -4.4x | -0.6x | -0.3x | |
| |
|---|
| Median (9 companies) | -0.3x | 0.1x | -0.2x | -0.3x | -1.1x |
|---|
| Abbott Laboratories ($ABT) | 1.0x | 2.1x | 0.8x | 0.9x | 0.9x |
