SANTA ROSA — Medtronic, Inc., (NYSE: MDT) on Tuesday reported worldwide fourth-quarter revenue increased 3 percent from a year before, while worldwide quarterly sales for its Cardiac and Vascular Group, which has operations in Santa Rosa, rose 1 percent.
Fourth-quarter sales were $4.57 billion companywide and $2.369 billion for the group.
“In our fourth quarter, our overall organization once again delivered balanced growth, with strong performances in some areas more than offsetting challenges in other parts of our business,” said Omar Ishrak, Medtronic chairman and CEO, in a statement. “We remain focused on delivering consistent and dependable growth across all of our businesses through our three growth vectors: new therapies, emerging markets, and independent services and solutions.”
The Minneapolis-based company, as a whole, said it adjusted for a $39 million negative foreign currency impact as well two settlements: a one-time $746 million pre-tax litigation charge related to its global patent agreement reached Edward Life Sciences Corporation and the company’s INFUSE product liability settlement.
After adjusting for those, fourth-quarter net earnings totaled $448 million, or $.44 per diluted share — both a decrease of 54 percent over the same period the year prior.
The Cardiac and Vascular Group, which includes the Cardiac Rhythm Disease Management, Coronary, Structural Heart, and Endovascular businesses, had total international sales of $1.36 billion, up 3 percent on a constant currency basis or 1 percent as reported. Growth was driven by growth in structural hearth, endovascular sales, including growth from Hospital Solutions and Cardiocom, which helped offset declines in coronary and defribillation systems.
Of group sales, Cardiac Rhythm Disease Management revenue was $1.346 billion, up 1 percent as reported, while fourth-quarter revenue for Defibrillation Systems declined 2 percent to $734 million.
Sales of heart-pacing treatments were $503 million, with no change, on a constant-currency basis.
Coronary revenue of $446 million declined 4 percent as reported, driven by growth in drug-eluting stents offset by declines in bare-metal stents and renal denervation. Sales of drug-eluting stents increased 2 percent, driven by continued broad worldwide share gains of the Resolute Integrity drug-eluting stent.
Structural Heart revenue of $337 million grew 9 percent on both a constant currency basis and as reported. Results were driven by growth from the U.S. launch of the CoreValve System self-expanding transcatheter. It’s a differentiated therapy for severe aortic stenosis patients who are too ill or frail to have their aortic valves replaced through traditional open-heart surgery.
Endovascular revenue of $240 million grew by 2 percent as reported. Results were driven by solid procedure growth in both abdominal aortic aneurysms and thoracic aortic diseases, with the continued global adoption of the business’s market-leading Endurant II and Valiant Captivia stent grafts, the company said.
Overall, fourth-quarter net earnings and diluted earnings per share on a non-GAAP basis were $1.135 billion and $1.12, an increase of 1 percent and 2 percent, respectively, over the same period in the prior year.
The company reported fiscal 2014 revenue of $17 billion, an increase of 4 percent on a constant-currency basis after adjusting for a $175 million negative foreign-currency impact, or 3 percent as reported. As reported, fiscal year 2014 net earnings were $3.065 billion or $3.02 per diluted share, a decrease of 12 percent and 10 percent, respectively.
Fourth-quarter international revenue of $2.145 billion increased 5 percent on a constant-currency basis, or 3 percent as reported. International sales accounted for 47 percent of Medtronic’s worldwide revenue in the quarter.
Emerging-market revenue of $571 million increased 14 percent on a constant-currency basis, or 10 percent as reported. It represents 13 percent of company revenue.
Shares of Medtronic were $59.41 at the close of trading Tuesday, down 93 cents, or 1.54 percent. But trading prices overall were down during the day amid talk from the Federal Reserve on adjusting interest rates. The Dow Jones Industrial Index down about two-thirds of a percentage point.
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