Abbott to cut 2 percent of workforce; reports 13 percent sales jump
Abbott Park, IL, United States (AHN) – Abbott Laboratories plans to remove 2 percent of its workforce to increase profitability of its pharmaceutical business.
The Illinois-based company said Wednesday it is streamlining commercial and manufacturing operations by slashing about 1,900 positions. It attributed the restructuring to changes brought by the federal healthcare reform law, which Congress passed last year, and “a challenging regulatory environment.”
The job cuts will only affect the U.S. pharmaceutical business. They will cost $295 million, including $95 million for transferring product manufacturing to other plants and $135 million for employee-related charges.
At the same time, Abbott reported a 13.4 percent sales increase for the fourth quarter. The company said growth was fueled by a 22 percent rise in global pharmaceutical revenue.
Sales from international pharmaceuticals jumped 30 percent while the U.S.pharmaceutical business grew 14 percent.
Profit for the quarter declined 6 percent to $1.44 billion, or 92 cents a share. Abbott forecast earnings of $4.54 to $4.64 for the full 2011 fiscal year.
Shares fell 2 percent early Wednesday.
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