Pfizer 2007 Annual Report Download - page 80

78 2007 Financial Report
Notes to Consolidated Financial Statements
Pfizer Inc and Subsidiary Companies
The following tables present segment, geographic and revenue information:
Segment
FOR/AS OF THE YEAR ENDED DEC. 31,
(MILLIONS OF DOLLARS) 2007 2006 2005
Revenues
Pharmaceutical $ 44,424 $ 45,083 $ 44,269
Animal Health 2,639 2,311 2,206
Corporate/Other(a) 1,355 977 930
Total revenues $ 48,418 $ 48,371 $ 47,405
Segment profit/(loss)(b)
Pharmaceutical $ 20,740 $ 21,615 $ 19,599
Animal Health 620 455 405
Corporate/Other(a)(c) (12,082) (9,042) (9,204)
Total profit/(loss) $ 9,278 $ 13,028 $ 10,800
Identifiable assets
Pharmaceutical $ 67,431 $ 72,497 $ 74,056
Animal Health 2,043 1,951 2,098
Discontinued operations/Held for sale 114 62 6,659
Corporate/Other(a)(d) 45,680 41,036 34,157
Total identifiable assets $115,268 $115,546 $116,970
Property, plant and equipment additions(e)
Pharmaceutical $ 1,608 $ 1,681 $ 1,703
Animal Health 70 51 61
Discontinued operations/Held for sale —162 189
Corporate/Other(a) 202 156 153
Total property, plant and equipment additions $ 1,880 $ 2,050 $ 2,106
Depreciation and amortization(e)
Pharmaceutical $ 1,886 $ 1,765 $ 1,880
Animal Health 52 49 59
Discontinued operations/Held for sale —71 78
Corporate/Other(a)(f) 3,262 3,408 3,559
Total depreciation and amortization $ 5,200 $ 5,293 $ 5,576
(a)
Corporate/Other includes our gelatin capsules business, our
contract manufacturing business and a bulk pharmaceutical
chemicals business, and transition activity associated with our
former Consumer Healthcare business (sold in December 2006).
Corporate/Other under Segment profit/(loss) also includes
interest income/(expense), corporate expenses (e.g., corporate
administration costs), other income/(expense) (e.g., realized
gains and losses attributable to our investments in debt and
equity securities), certain performance-based and all share-
based compensation expenses, significant impacts of purchase
accounting for acquisitions, acquisition-related costs,
intangible asset impairments and costs related to our cost-
reduction initiatives.
(b) Segment profit/(loss) equals
Income from continuing operations
before provision for taxes on income, minority interests and the
cumulative effect of a change in accounting principles. Certain costs,
such as significant impacts of purchase accounting for
acquisitions, acquisition-related costs and costs related to our
cost-reduction initiatives and transition activity associated with
our former Consumer Healthcare business, are included in
Corporate/Other only. This methodology is utilized by
management to evaluate our businesses.
(c) In 2007,
Corporate/Other includes: i) restructuring charges and
implementation costs associated with our cost-reduction initiatives
of $3.9 billion; (ii) significant impacts of purchase accounting for
acquisitions of $3.4 billion, including acquired in-process research
and development, intangible asset amortization and other
charges; (iii) $2.8 billion of charges associated with Exubera. See
Note 4. Asset Impairment Charges and Other Costs Associated with
Exiting Exubera ; (iv) net interest income of $1.1 billion; (v) all share-
based compensation expense; (vi) gain on disposal of assets and
other of $174 million; (vii) transition activity associated with our
former Consumer Healthcare business of $26 million in income; and
(viii) acquisition-related costs of $11 million.
In 2006, Corporate/Other includes: (i) significant impacts of
purchase accounting for acquisitions of $4.1 billion, including
acquired in-process research and development, intangible asset
amortization and other charges; (ii) restructuring charges and
implementation costs associated with our cost-reduction
initiatives of $2.1 billion; (iii) all share-based compensation
expense; (iv) net interest income of $437 million; (v) impairment
of the Depo-Provera intangible asset of $320 million; (vi) gain on
disposals of investments and other of $173 million; (vii) a research
and development milestone due to us from sanofi-aventis of
approximately $118 million; and (viii) acquisition-related costs of
$27 million.
In 2005, Corporate/Other includes: (i) significant impacts of purchase
accounting for acquisitions of $4.9 billion, including acquired in-
process research and development, intangible asset amortization
and other charges; (ii) costs associated with the suspension of
Bextra’s sales and marketing of $1.2 billion; (iii) acquisition-related
costs of $918 million; (iv) restructuring charges and implementation
costs associated with our cost-reduction initiatives of $763 million;
(v) net interest income of $269 million; (vi) all share-based
compensation expense; and (vii) gain on disposals of investments
and other of $134 million.
(d) Corporate assets are primarily cash, short-term investments and
long-term investments and loans.
(e) Certain production facilities are shared by various segments.
Property, plant and equipment, as well as capital additions and
depreciation, are allocated based on estimates of physical
production.
(f)
Corporate/Other includes non-cash charges associated with
purchase accounting related to intangible asset amortization of
$3.0 billion in 2007, $3.2 billion in 2006 and $3.3 billion in 2005.