Pfizer 2012 Annual Report Download - page 45

Financial Review
Pfizer Inc. and Subsidiary Companies
44
2012 Financial Report
The above table excludes amounts for potential milestone payments under collaboration, licensing or other arrangements, unless the
payments are deemed reasonably likely to occur. Payments under these agreements generally become due and payable only upon the
achievement of certain development, regulatory and/or commercialization milestones, which may span several years and which may never
occur.
In 2013, we expect to spend approximately $1.5 billion on property, plant and equipment. Planned capital spending mostly represents
investment to maintain existing facilities and capacity. We rely largely on operating cash flows to fund our capital investment needs. Due to our
significant operating cash flows, we believe we have the ability to meet our capital investment needs and anticipate no delays to planned
capital expenditures.
See "Subsequent Events" above for information about a January 2013 Zoetis debt offering. If we were to incorporate the 2013 Zoetis debt
offering into our contractual obligations table above, total payments due would increase by $5.8 billion, representing expected principal and
interest obligations of $223 million in 2013 through 2014, $629 million in 2015 through 2016 and $4.9 billion thereafter.
Off-Balance Sheet Arrangements
In the ordinary course of business and in connection with the sale of assets and businesses, we often indemnify our counterparties against
certain liabilities that may arise in connection with a transaction or that are related to activities prior to a transaction. These indemnifications
typically pertain to environmental, tax, employee and/or product-related matters, and patent-infringement claims. If the indemnified party were
to make a successful claim pursuant to the terms of the indemnification, we would be required to reimburse the loss. These indemnifications
generally are subject to threshold amounts, specified claim periods and other restrictions and limitations. Historically, we have not paid
significant amounts under these provisions and, as of December 31, 2012, recorded amounts for the estimated fair value of these
indemnifications are not significant.
Certain of our co-promotion or license agreements give our licensors or partners the rights to negotiate for, or in some cases to obtain under
certain financial conditions, co-promotion or other rights in specified countries with respect to certain of our products.
Share-Purchase Plans
On December 12, 2011, we announced that the Board of Directors had authorized a $10 billion share-purchase plan (the December 2011
Stock Purchase Plan). On November 1, 2012, we announced that the Board of Directors had authorized an additional $10 billion share-
purchase plan, which became effective on November 30, 2012.
In 2012, we purchased approximately 349 million shares of our common stock for approximately $8.2 billion. In 2011, we purchased
approximately 459 million shares of our common stock for approximately $9.0 billion. In 2010, we purchased approximately 61 million shares
of our common stock for approximately $1.0 billion. After giving effect to share purchases through year-end 2012, our remaining share-
purchase authorization is approximately $11.8 billion at December 31, 2012.
Dividends on Common Stock
We paid dividends on our common stock of $6.5 billion in 2012 and $6.2 billion in 2011. In December 2012, our Board of Directors declared a
first-quarter 2013 dividend of $0.24 per share, payable on March 5, 2013, to shareholders of record at the close of business on February 1,
2013. The first-quarter 2013 cash dividend will be our 297th consecutive quarterly dividend.
Our current and projected dividends provide a return to shareholders while maintaining sufficient capital to invest in growing our businesses
and increasing shareholder value. Our dividends are not restricted by debt covenants. While the dividend level remains a decision of Pfizer’s
Board of Directors and will continue to be evaluated in the context of future business performance, we currently believe that we can support
future annual dividend increases, barring significant unforeseen events.
NEW ACCOUNTING STANDARDS
Recently Adopted Accounting Standards
See Notes to Consolidated Financial Statements—Note 1B. Basis of Presentation and Significant Accounting Policies: Adoption of New
Accounting Standards.
Recently Issued Accounting Standards, Not Adopted as of December 31, 2012
None
FORWARD-LOOKING INFORMATION AND FACTORS THAT MAY AFFECT FUTURE RESULTS
This report and other written or oral statements that we make from time to time contain forward-looking statements that set forth anticipated
results based on management’s plans and assumptions. Such forward-looking statements involve substantial risks and uncertainties. We have
tried, wherever possible, to identify such statements by using words such as “will,” “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,”