Abbott 2006 Annual Report | Financial Report: Consolidated Statement of Cash Flows

Page 19 of 40

Financials

Abbott Global

Consolidated Statement of Cash Flows

(dollars in thousands)

Year Ended December 31	2006		2005			2004

Cash Flow From (Used in) Operating Activities of Continuing Operations: Net earnings	$	1,716,755		$	3,372,065		$	3,235,851

Less: Earnings from discontinued operations, net of taxes		—			—			60,015

Earnings from continuing operations		1,716,755			3,372,065			3,175,836

Adjustments to reconcile earnings from continuing operations to net cash from operating activities of continuing operations — Depreciation		983,485			868,808			840,591

Amortization of intangible assets		575,265			490,131			448,109

Share-based compensation		329,957			30,140			28,989

Acquired in-process research and development		1,927,300			17,131			279,006

Investing and financing (gains) losses, net		277,388			125,328			47,400

Trade receivables		(101,781	)		(98,216	)		(588,575	)

Inventories		104,653			(88,257	)		(285,328	)

Prepaid expenses and other assets		(283,455	)		(406,858	)		(431,436	)

Trade accounts payable and other liabilities		(183,203	)		199,703			602,605

Income taxes		(84,275	)		537,429			188,826

Net Cash From Operating Activities of Continuing Operations		5,262,089			5,047,404			4,306,023

Cash Flow From (Used in) Investing Activities of Continuing Operations: Acquisitions of businesses and technologies, net of cash acquired		(7,923,163	)		(295,123	)		(2,327,821	)

Investment in Boston Scientific common stock, note receivable and derivative financial instruments		(2,095,780	)		—			—

Acquisitions of property and equipment		(1,337,818	)		(1,207,493	)		(1,291,633	)

Other purchases of investment securities		(33,632	)		(15,670	)		(543,292	)

Proceeds from sales of investment securities		18,476			783,599			224,923

Other		(25,712	)		14,600			14,433

Net Cash (Used in) Investing Activities of Continuing Operations		(11,397,629	)		(720,087	)		(3,923,390	)

Cash Flow From (Used in) Financing Activities of Continuing Operations: Proceeds from (repayments of) commercial paper, net		5,004,000			(1,619,000	)		813,000

Proceeds from issuance of long-term debt		4,000,000			1,851,013			1,500,000

Repayment of long-term debt		(3,532,408	)		(150,000	)		(1,650,000	)

Other borrowing transactions, net		179,225			90,820			142,998

Purchases of common shares		(754,502	)		(1,302,314	)		(499,745	)

Proceeds from stock options exercised, including income tax benefit		502,782			223,637			155,197

Dividends paid		(1,777,170	)		(1,686,472	)		(1,599,770	)

Net Cash From (Used in) Financing Activities of Continuing Operations		3,621,927			(2,592,316	)		(1,138,320	)

Effect of exchange rate changes on cash and cash equivalents		73,966			(193,954	)		184,271

Net cash provided by operating activities of discontinued operations and cash (used in) from investing and financing activities of $(59,088) and $700,000 in 2004, respectively		67,152			127,012			801,920

Net (Decrease) Increase in Cash and Cash Equivalents		(2,372,495	)		1,668,059			230,504

Cash and Cash Equivalents, Beginning of Year		2,893,687			1,225,628			995,124

Cash and Cash Equivalents, End of Year	$	521,192		$	2,893,687		$	1,225,628

The accompanying notes to consolidated financial statements are an integral part of this statement.

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