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St. Jude Medical Lifts FY12 Forecast As Q1 Results Top Estimates


St. Jude Medical Inc. (STJ) on Wednesday lifted its fiscal 2012 adjusted earnings forecast, after first-quarter earnings, excluding certain charges, increased and topped analysts' estimates. The growth reflected better-than expected revenues, despite negative currency impact. Including charges related to ongoing restructuring actions in a business unit and license dispute settlement, the medical device maker's first-quarter net profit declined.

Chief Executive Officer Daniel Starks said, "First quarter results exceeded expectations for sales and adjusted earnings per share. This was driven especially by innovations designed to improve patient outcomes and reduce the cost of health care such as our new line of Unify Quadra ICDs in the U.S."

For its first quarter, net earnings declined to $212 million or $0.67 per share from last year's $233 million or $0.71 per share. The latest quarter results included charges totaling $0.19 per share, partly offset by income tax benefit. The prior year's results were hurt by charges totaling $0.09 per share.

Adjusted net earnings were $272 million or $0.86 per share, higher than prior year's $262 million or $0.80 per share. On average, 25 analysts polled by Thomson Reuters expected earnings of $0.83 per share for the quarter. Analysts' estimates typically exclude one-time items.

Quarterly net sales edged up 1 percent to $1.395 billion, beating Wall Street analysts' estimate of $1.38 billion. Excluding negative foreign currency translation impact, net sales increased 2 percent.

Segment-wise, Cardiac Rhythm Management sales fell 4 percent hurt by a 3 percent drop in ICD product sales and a 4 percent decline in sales of pacemakers.

The decline was more than offset by a 13 percent increase in Atrial Fibrillation sales, and sales of Neuro-modulation products climbed 12 percent.

Total cardiovascular sales also grew 3 percent as growth in Structural heart product sales offset lower sales of vascular products.

Looking ahead to its second quarter, St. Jude Medical expects reported earnings per share of $0.80 to $0.82 and adjusted earnings per share of $0.86 to $0.88 per share, while analysts estimate earnings of $0.89 per share.

Further, for full year 2012, St. Jude Medical raised its adjusted earnings per share guidance to $3.44 to $3.49 from its earlier outlook of $3.43 to $3.48. Analysts project earnings of $3.46 per share for 2012. Including items, full-year earnings would be between $3.10 and $3.15 per share.

The company added that it will provide its range for revenue expectations for both periods by product category during today's earnings conference call.

Starks added, "We look forward to building on our strong start to 2012 by introducing our Portico line of transcatheter heart valves and our EnligHTN line of renal denervation products in Europe before the end of this year."

In pre-market activity, St. Jude shares are currently trading at $39.80, up $0.73 or 1.87 percent.

by RTTNews Staff Writer

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