Medical equipment maker Medtronic, Inc. (MDT) Tuesday said profit in the second quarter declined from the prior year, weighed down by certain litigation charges. Earnings, excluding non-recurring items, matched Wall Street estimates. Further, the company maintained its full-year earnings outlook.
Omar Ishrak, CEO, said, "Our second quarter performance reflects the results of our ongoing focus to deliver consistent and dependable growth in a changing healthcare environment. Our growth was broad-based across several businesses and geographies, driven by continued stabilization of our end markets and the ongoing successful execution of new product launches."
Net earnings fell to $646 million from $871 million in the previous year. Earnings per share dropped to $0.63 from $0.82.
The latest results included a one-time, non-cash $245 million pre-tax charge related to certain litigation in the Structural Heart business.
Earnings, excluding one-time items, were $0.88 per share. On average, 24 analysts polled by Thomson Reuters expected earnings of $0.88 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales, however, edged up 2 percent to $4.10 billion from $4.02 billion. On a constant currency basis, sales rose 5 percent. Analysts expected revenues of $4.05 billion.
The Cardiac and Vascular Group reported revenues of $2.137 billion, up 2 percent from last year. The segment includes the Cardiac Rhythm Disease Management or CRDM , Coronary, Structural Heart, and Endovascular businesses.
Within the segment, CRDM revenue slid 3 percent while revenue from Implantable Cardioverter Defibrillators was flat. Coronary revenue climbed 14 percent to $429 million amid strength in sales of drug-eluting stents.
The Restorative Therapies Group reported 2 percent higher sales at $1.958 billion, driven by growth in Surgical Technologies, Neuromodulation, and Diabetes.
Broadly, International revenue edged up 1 percent to $1.806 billion and Emerging market revenue climbed 14 percent to $464 million.
Total costs and expenses climbed to $3.24 billion from $2.98 billion, weighed down by higher cost of products sold, as well as litigation charges in the latest period.
Looking ahead to fiscal 2013, the company still expects earnings per share in the range of $3.62 to $3.70. Revenue growth is estimated in the range of 3 to 4 percent on a constant currency basis.
Wall Street expects earnings of $3.66 per share on revenues of $16.44 billion.
MDT closed at $41.81 on Monday.
by RTT Staff Writer
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