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North Bay Business Journal

Tuesday, November 20, 2012, 3:40 pm

Second-quarter sales grow 2% for locally tied Medtronic group

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    MedtronicSANTA ROSA — Second-quarter sales for Medtronic’s Cardiac and Vascular Group, which includes operations in Santa Rosa, increased 2 percent from a year before, while most other measures remained the same, according to financial results reported today.

    Group sales totaled $2.137 billion for the quarter ended Oct. 26. Santa Rosa-based Coronary and Renal Denervation and Endovascular Therapies business units, employing 800 locally, are part the Cardiac and Vascular Group of Minneapolis-based Medtronic (NYSE: MDT).

    Solid growth in coronary, endovascular, structural heart and AF Solutions helped offset declines in pacing for the Cardiac and Vascular Group, according to the device maker. Group international sales of $1.168 billion increased 7 percent on a constant-currency basis from a year before but as reported were unchanged. Total group revenue of $1.227 billion was flat after adjusting for currency and down 3 percent overall.

    Second-quarter revenue from implantable cardioverter defibrillators was unchanged at $689 million, while revenue from heart-pace devices was $480 million, a decline of 2 percent when adjusting for currency exchange rates. But that was partially offset by coronary revenues, which grew 19 percent to $429 million, excluding currency adjustments.

    Medtronic’s drug-covered Resolute Integrity stent helped spur growth, with sales of stents increasing by 39 percent when adjusted for currency.

    Quarterly net earnings for the company as a whole decreased 26 percent, or 63 cents per diluted share, on worldwide revenue of $646 million. Medtronic attributed the decline to a $245 million one-time litigation charge in its Structural Heart business.

    That charge resulted from a $74 million jury award to Edwards Lifesciences Corp, which claimed patent infringement in Medtronic’s making of its CoreValue transcatheter aortic valve. The ruling was upheld last week by the U.S. Court of Appeals.

    Structural-heart device revenue of $271 million grew by 2 percent, while endovsacular device sales increased 12 percent to $210 million.

    The price of Medtronic shares increased 2 percent to $42.66 at the close of trading Tuesday. After-hours pricing was lower at $42.50 per share.

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