Medtronic, Inc. (Minneapolis, MN, U.S.) has announced that it has reached record quarterly revenues of U.S. $2.665 billion, an increase of 24.1 percent from the $2.148 billion of the comparable period 1 year ago. Reflecting the weaker dollar outside the United States, foreign currency translation had a positive impact on quarterly revenue of $115.7 million, when compared to the prior year.
Net earnings in the quarter were $568.9 million, or $0.47 per diluted share, an increase of 16.8 percent from the $487.1 million in net earnings and 17.5 percent more than the $0.40 per diluted share recorded in last year's fourth quarter. Excluding a required acquisition-related in-process research and development charge of $17.2 million taken in the fourth quarter, net earnings and net earnings per diluted share of $586.1 million and $0.48 grew 20.3 percent and 20 percent, respectively.
"Market share gains and accelerating growth across all operating segments fueled an especially strong performance in the quarter," Art Collins, chairman and CEO of Medtronic, said in a written statement announcing the company's quarterly results. "The breadth and depth of Medtronic's entire product portfolio was clearly evident as the revenue growth rate was the highest we have reported in four years."
The fourth-quarter results capped a record year with strong revenues and earnings. The company reported annual revenues of $9.087 billion, an increase of 18.6 percent from the $7.665 billion in the prior year. Reflecting the weaker dollar outside the United States, foreign exchange translation had a positive impact on annual revenue of $344.2 million, when compared to the prior year.
Net earnings for the year were $1.959 billion, or $1.60 per diluted share, an increase of 22.5 percent from net earnings of $1.600 billion in the prior year. Excluding special and in-process research and development charges in fiscal year 2004 of $38.1 million and $120.9 million in fiscal year 2003, net earnings and net earnings per diluted share were $1.997 billion and $1.63, respectively. This represents growth in net earnings and net earnings per diluted share of 16.1 percent and 16.4 percent, respectively.
The company's Cardiac Rhythm Management unit posted $1.247 billion in quarterly revenues and $4.238 billion for the year, representing quarterly growth of 22 percent and annual growth of 17 percent when compared to the same periods 1 year ago.
Extending its leadership with market share gains, quarterly worldwide revenues for implantable defibrillators grew 34 percent, led by continued strong acceptance of the InSync II Marquis(TM) and the high-energy Maximo(TM) implantable defibrillators.
Another quarterly highlight included the presentation of results from the landmark SCD-HeFT (Sudden Cardiac Death in Heart Failure) trial, which demonstrated that implantable defibrillators reduced death by 23 percent in people with moderate heart failure compared to those who did not receive defibrillators. The fourth quarter also saw the first implants of EnTrust(TM), the company's next generation implantable defibrillator, and the addition of the InSync II Marquis and Maximo to the Medtronic CareLink(R) Network, a remote monitoring service now supporting nearly 10,000 patients worldwide.
Medtronic has also announced the European launch of Intrinsic(TM), the world's first implantable defibrillator with Managed Ventricular Pacing (MVP(TM)), a new pacing mode designed to promote natural heart activity by minimizing unnecessary right ventricular pacing. The Intrinsic is the first of three new implantable defibrillators Medtronic plans to launch during the first half of the new fiscal year. Additional products will include InSync Maximo(TM) and InSync Sentry(TM), an implantable defibrillator that will also allow physicians to monitor fluid build-up in the lungs of heart failure patients and treat them before hospitalization is required.
Worldwide pacing revenues increased 11 percent in the quarter due to continued physician preference for both the InSync(R) III and EnPulse(TM) pacemakers. Reflecting its full product pipeline, Medtronic also announced the first implants of the next generation EnRhythm(TM) pacemaker and introduced another version of EnPulse, which incorporates a feature that automatically adjusts electrical impulses delivered to the heart's upper right chamber. Medtronic expects to launch InSync(R) cardiac resynchronization therapy in Japan during the first quarter.
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