16. Unaudited Interim Financial Information


2016	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		Year
(dollars in millions except per share amounts)
Net sales	$	873.5	$	931.5	$	941.9	$	967.1	$	3,714.0
Cost of goods sold		320.4		351.0		352.2		348.1		1,371.7
Income from operations before income taxes		142.9		207.7		112.2		200.9		663.7
Net income		116.2		159.2		96.4		159.6		531.4
Basic earnings per share available to common shareholders		1.56		2.14		1.30		2.15		7.15
Diluted earnings per share available to common shareholders		1.54		2.11		1.27		2.11		7.03

The first quarter 2016 included litigation charges of $48.9 million, net charges from acquisition-related items of $4.5 million primarily consisting of a purchase accounting adjustment of $5.8 million associated with the reversal of a liability with respect to certain revenue-based and manufacturing-related milestones, and restructuring and productivity initiative costs of $9.8 million. These items decreased net income by $39.4 million after tax, or $0.52 diluted earnings per share available to common shareholders.

The second quarter 2016 included restructuring and productivity initiative costs of $11.9 million, net charges from acquisition-related items of $3.9 million primarily consisting of integration costs, and an asset impairment of $1.2 million. These items decreased net income by $11.3 million after tax, or $0.15 diluted earnings per share available to common shareholders.

The third quarter 2016 included litigation charges of $110.6 million, acquisition-related items of $5.0 million primarily consisting of integration costs, and restructuring and productivity initiative costs of $4.6 million. The income tax provision decreased $2.6 million due to the completion of certain IRS examinations. These items decreased net income by $81.5 million after tax, or $1.08 diluted earnings per share available to common shareholders.

The fourth quarter 2016 included litigation charges, net, of $45.7 million, a net benefit from acquisition-related items of $6.8 million primarily consisting of a benefit of $3.8 million related to integration costs and a benefit of $3.7 million related to purchase accounting adjustments, and restructuring and productivity initiative costs of $4.1 million. These items decreased net income by $27.6 million after tax, or $0.37 diluted earnings per share available to common shareholders.


2015	1st Qtr		2nd Qtr			3rd Qtr			4th Qtr		Year
(dollars in millions except per share amounts)
Net sales	$	819.7	$	859.8		$	865.7		$	870.8	$	3,416.0
Cost of goods sold		311.2		333.7			336.3			320.0		1,301.2
Income (loss) from operations before income taxes		184.6		59.2			(52.4	)		158.0		349.4
Net income (loss)		139.8		(54.7	)		(86.0	)		136.3		135.4
Basic earnings (loss) per share available to common shareholders^(A)		1.85		(0.74	)		(1.16	)		1.82		1.80
Diluted earnings (loss) per share available to common shareholders^(A)		1.82		(0.74	)^(B)		(1.16	)^(B)		1.79		1.77

^(A)	Total per share amounts may not add due to rounding.

^(B)	Common share equivalents primarily from share-based compensation plans were not included in the computation of diluted weighted average shares outstanding because their effect would have been antidilutive.

The first quarter 2015 included litigation charges of $10.3 million, a net benefit from acquisition-related items of $9.2 million primarily consisting of a purchase accounting adjustment of $10.2 million associated with the reversal of a liability with respect to a certain revenue-based milestone, and restructuring and productivity initiative costs of $3.9 million. These items decreased net income by $2.6 million after tax, or $0.03 diluted earnings per share available to common shareholders.

The second quarter 2015 included litigation charges, net, of $343.7 million, a gain of $210.5 million related to the Gore Proceeds, restructuring and productivity initiative costs of $8.5 million, and net charges from acquisition-related items of $4.5 million. These items increased net loss by $209.0 million after tax, or $2.73 diluted loss per share available to common shareholders.

The third quarter 2015 included litigation charges of $241.1 million, restructuring and productivity initiative costs of $14.6 million, and acquisition-related items of $2.5 million primarily consisting of integration costs. These items increased net loss by $240.5 million after tax, or $3.14 diluted loss per share available to common shareholders.

The fourth quarter 2015 included net charges from acquisition-related items of $33.9 million primarily consisting of purchase accounting adjustments of $24.3 million and integration costs of $5.4 million, restructuring and productivity initiative costs of $14.5 million, and an asset impairment of $4.5 million. These items decreased net income by $28.3 million after tax, or $0.37 diluted earnings per share available to common shareholders.