DUBLIN - November 8, 2017 -
Medtronic plc (NYSE: MDT) today announced its preliminary revenue
for its second quarter of fiscal year 2018, which ended October 27,
2017. The company announced preliminary second quarter worldwide
revenue of approximately $7.050 billion, a decrease of 4 percent as
reported, with the decline driven by the company's divestiture of
its Patient Care, Deep Vein Thrombosis (Compression), and
Nutritional Insufficiency businesses to Cardinal Health that
occurred at the beginning of the quarter. Second quarter revenue
increased 3 percent on a comparable, constant currency basis, which
adjusts for the divestiture and a $35 million positive impact from
foreign currency. Excluding the impact of Hurricane Maria, second
quarter revenue growth would have been 4 percent on a comparable,
constant currency basis.
The company announced that the impact of Hurricane
Maria was approximately $55 to $65 million to its second quarter
revenue and is expected to be approximately $0.03 to its second
quarter non-GAAP earnings per share (EPS). The company was able to
limit the financial impact versus its original expectations
provided on October 6th due to the performance and resilience of
its employees driving a faster-than-anticipated recovery of its
operations in Puerto Rico. As expected, the majority of the impact
was to its Minimally Invasive and Restorative Therapies Groups in
the United States.
On September 20th, Hurricane Maria devastated the
island of Puerto Rico and incapacitated Medtronic's four
manufacturing plants. Within two weeks, on October 2nd the company
had substantially repaired its four Puerto Rico manufacturing
facilities and restarted limited production, with production
reaching 50 to 60 percent capacity by October 9th, and ramping to
near pre-hurricane capacity by October 18th.
Medtronic's primary focus has been to support the
well-being of its more than 5,000 direct and contract employees on
the island and restore its operations to full productivity. The
company has and continues to provide critical supplies for its
people in Puerto Rico, including water, food, temporary housing,
medical care, counseling services, child care, laundry facilities,
and power generators.
Despite ongoing island infrastructure challenges,
the company is now fully prepared for sustained operations on the
island. Medtronic took several actions to restore its manufacturing
operations, including implementing on-site and redundant power
generator systems; alternate technologies for telecommunication and
data connectivity; access to critical suppliers and production
materials; and shipping, transportation, and logistics
capabilities. As a result, the company was able to minimize the
impact of the hurricane on both its supply to customers as well as
the company's second quarter financial results.
"The creativity, dedication, and persistence of
our employees - both on and off the island - in dealing with the
aftermath of Hurricane Maria was simply incredible. In particular,
our employees in Puerto Rico made countless selfless contributions,
despite extensive impact to their personal lives, coming to work
every day to ensure customers and patients worldwide received our
products," said Omar Ishrak, Medtronic chairman and chief executive
officer. "Through the efforts of our team, along with help from the
local government and the U.S. FDA, we were able to achieve
extraordinary results with our Puerto Rico operations over the
month of October, well exceeding our initial expectations. I am
extremely proud of our passionate employees whose tireless
dedication was critical in restoring our operations."
Second Quarter EPS
Guidance
Excluding the impact of Hurricane Maria, Medtronic today reiterated
its expectation that second quarter adjusted EPS would be flat to
slightly up on a comparable, constant currency basis from the prior
year comparable EPS of $1.04. The company expects a one cent
positive impact to adjusted EPS from foreign currency. Adjusted EPS
guidance does not include any charges or gains that would be
reported as non-GAAP adjustments to earnings.
Webcast Information
Medtronic will report financial results for the second quarter of
fiscal year 2018 and provide an outlook for its fiscal year on
Tuesday, November 21, 2017. This is one week earlier than the
preliminary date previously provided by the company. A news release
will be issued at approximately 5:45 a.m. Central Standard Time
(CST) and will be available at http://newsroom.medtronic.com.
Medtronic will host a webcast at 7:00 a.m. CST to discuss its
financial results. The webcast can be accessed at
http://investorrelations.medtronic.com on November 21, 2017. Within
24 hours of the webcast, a replay and transcript of the prepared
remarks will be available by clicking on the Investor Events link
at http://investorrelations.medtronic.com.
Looking ahead, Medtronic plans to report its
fiscal 2018 third and fourth quarter financial results on Tuesday,
February 20, 2018, and Thursday, May 24, 2018, respectively.
Confirmation and additional details will be provided closer to the
specific quarterly earnings release date.
Non-GAAP Schedule
To view the Preliminary FY18 Second Quarter Non-GAAP Reconciliation
schedule, click here. The document can also be accessed by visiting
newsroom.medtronic.com.
About Medtronic
Medtronic plc (www.medtronic.com), headquartered in Dublin,
Ireland, is among the world's largest medical technology, services
and solutions companies - alleviating pain, restoring health and
extending life for millions of people around the world. Medtronic
employs more than 84,000 people worldwide, serving physicians,
hospitals and patients in approximately 160 countries. The company
is focused on collaborating with stakeholders around the world to
take healthcare Further, Together.
FORWARD LOOKING
STATEMENTS
This press release contains forward-looking
statements, which are subject to risks and uncertainties, including
those described in Medtronic's periodic reports and other filings
with the U.S. Securities and Exchange Commission (the "SEC").
Anticipated results only reflect information available to Medtronic
at this time and may differ from actual results. Medtronic does not
undertake to update its forward-looking statements or any of the
information contained in this press release. Certain information in
this press release includes calculations or figures that have been
prepared internally and have not been reviewed or audited by our
independent registered public accounting firm, including but not
limited to, certain information in the financial schedule
accompanying this press release. Use of different methods for
preparing, calculating or presenting information may lead to
differences and such differences may be material. The revenue
results presented in this news release are preliminary and may
change. There can be no assurance that the company's actual results
for the period presented in this news release will not differ from
the preliminary financial data presented in this news release and
such changes could be material. This preliminary financial data
should not be viewed as a substitute for full financial statements
prepared in accordance with GAAP and is not necessarily indicative
of the results to be achieved for any future periods.
NON-GAAP FINANCIAL
MEASURES
This press release contains financial measures and
guidance, including revenue and growth rates on a comparable,
constant currency basis, and diluted EPS, all of which are
considered "non-GAAP" financial measures under applicable SEC rules
and regulations. References to quarterly figures increasing or
decreasing are in comparison to the second quarter of fiscal year
2017.
Medtronic management believes
that in order to properly understand its short-term and long-term
financial trends, including period over period comparisons of the
company's operations, investors may find it useful to exclude the
effect of certain charges or gains that contribute to or reduce
earnings but that result from transactions or events that
management believes may or may not recur with similar materiality
or impact to operations in future periods (Non-GAAP Adjustments).
Medtronic generally uses non-GAAP financial measures to facilitate
management's review of the operational performance of the company
and as a basis for strategic planning. Non-GAAP financial measures
should be considered supplemental to and not a substitute for
financial information prepared in accordance with U.S. generally
accepted accounting principles (GAAP), and investors are cautioned
that Medtronic may calculate non-GAAP financial measures in a way
that is different from other companies. Management strongly
encourages investors to review the company's consolidated financial
statements and publicly filed reports in their entirety.
Reconciliations of the non-GAAP financial measures to the most
directly comparable GAAP financial measures are included in the
financial schedule accompanying this press release.
Medtronic calculates
forward-looking non-GAAP financial measures based on internal
forecasts that omit certain amounts that would be included in GAAP
financial measures. For instance, forward-looking revenue growth
and EPS projections exclude the impact of foreign currency
fluctuations. Forward-looking non-GAAP EPS guidance also excludes
other potential charges or gains that would be recorded as Non-GAAP
Adjustments to earnings during the fiscal year. Medtronic does not
attempt to provide reconciliations of forward-looking non-GAAP EPS
guidance to projected GAAP EPS guidance because the combined impact
and timing of recognition of these potential charges or gains is
inherently uncertain and difficult to predict and is unavailable
without unreasonable efforts. In addition, we believe such
reconciliations would imply a degree of precision and certainty
that could be confusing to investors. Such items could have a
substantial impact on GAAP measures of financial
performance.
-end-
View Preliminary FY18 Second Quarter Non-GAAP
Reconciliation
Contacts:
Fernando Vivanco
Public Relations
+1-763-505-3780
Ryan Weispfenning
Investor Relations
+1-763-505-4626
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Medtronic plc via Globenewswire
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