Medical equipment maker Edwards Lifesciences Corp. (EW), Thursday reported a 25% increase in fourth quarter profit, helped by robust sales of transcatheter heart valves and surgical products. Sales for the quarter grew 11.9%, coming in above expectations. Looking ahead to full year 2010, the company said its financial goals remain unchanged, however, provided first quarter outlook below current Street expectations.
Net income for the Irvine, California-based Edwards rose 24.9% to $47.6 million or $0.80 per share from $38.1 million or $0.66 per share in the same quarter a year ago.
During the quarter, Edwards recorded a $3.7 million special charge related to the write-off of previously capitalized patent enforcement costs.
Excluding special items, net income was $49.8 million or $0.84 per share, up from $45.2 million or $0.78 per share in the prior-year quarter.
On average, 25 analysts' polled by Thomson Reuters expected earnings of $0.85 per share for the quarter. Analysts' estimate typically excludes one-time items.
Edwards' net sales increased 11.9% to $346.7 million from $309.7 million in the year-earlier quarter, beating Street estimates of $342.95 million for the quarter.
Underlying sales growth was 10.2%, which excludes a $16.6 million positive impact from foreign exchange and an $11.7 million reduction primarily from divested products.
Driven by strong transcatheter heart valve sales and recent U.S surgical product introductions, sales of Heart Valve Therapy rose 25.8% to $188.3 million, while Critical Care sales rose 2.2% to $120.8 million helped by strong sales of FloTrac systems, pressure monitoring products and PreSep oximetry catheters.
Cardiac Surgery Systems sales for the quarter were $23.9 million. Vascular sales were $13.7 million, a decline from $18.9 million in the same quarter last year due primarily to the divestiture of the LifeStent product line.
Domestic and international sales for the fourth quarter rose 7.9% to $140.7 million, while international sales improved 16.4% to $206.0 million.
Sequentially, in the third quarter, profit of Edwards surged to $73.5 million or $1.25 per share from $32.9 million or $0.56 per share helped by one-time gains, as sales grew more than 7%, led by heart valve therapy. Net sales were up 7.3% at $325.7 million.
Amongst others in the industry, drugs and medical device maker Hospira, Inc. (HSP), in its fourth quarter, reported net income that declined 8% to $96.7 million or $0.58 per share, as higher operating costs and expenses more than offset a 15.5% increase in revenue. Net sales was $1.06 billion for the quarter.
Another player, St. Jude Medical Inc. (STJ), in its fourth quarter, reported a swing to profit, reflecting lower charges on special items. St. Jude reported a net profit of $189.65 million or $0.57 per share, compared with a net loss of $201.16 million or $0.58 per share a year ago. Net sales were up 6% at $1.20 billion.
For the quarter under review, Edwards' gross profit margin was 70.7%, up from 68.1% in the year-ago quarter, due primarily to product mix, partially offset by foreign exchange.
Driven by foreign exchange and higher Heart Valve Therapy sales and marketing expenses, selling, general and administrative expenses jumped 38.2% to $132.3 million from the same quarter last year. Research and development expenses were $48.3 million, or 13.9 % of sales.
For full year 2009, net income surged to $229.1 million or $3.90 per share from $128.9 million or $2.19 per share a year ago. Excluding special items, net income was $179.0 million or $3.05 per share. Net sales rose 6.8% to $1.32 billion. The Street expected earnings of $3.05 per share on revenues of $1.33 billion for the quarter.
Looking forward to the full year 2010, excluding special items, the company said it expects to generate total sales of $1.43 to $1.50 billion, which represents 10% to 13% underlying growth, a gross profit margin increase of 50 to 100 basis points and net income growth of 17% to 19%. Earnings are expected to be in a range of $3.50 to $3.60 per share. The Street currently expects earnings of $3.56 per share on revenues of $1.47 billion for the year. For first quarter, the company said it expects earnings in the range of $0.77 to $0.81 per share, while Street analysts currently expect earnings of $0.82 per share for the quarter.
On January 8, 2010, brokerage Rodman & Renshaw initiated a 'Mkt Underperform' rating on Edwards shares, with a mean target of $93.35.
EW closed Thursday's regular trading at $89.67, down $2.78 or 3.01%, on a volume of 0.63 million shares. In after-hours, the stock further dropped $2.77 or 3.00%, to trade at $89.67. In the last 52-week period, the stock traded in a range of $52.86 to $94.55, with a three-month average volume of 0.31 million shares.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.