- Q2 Revenue of $7.6 Billion
Decreased 0.8% Reported and 1.5% Organic
- Q2 GAAP Diluted EPS of $0.36;
Q2 Non-GAAP Diluted EPS of $1.02
DUBLIN, Nov. 24, 2020 /CNW/ -- Medtronic plc
(NYSE:MDT) today announced financial results for its second quarter
of fiscal year 2021, which ended October 30,
2020.
The company reported second quarter worldwide revenue of
$7.647 billion, a decrease of 0.8
percent as reported and 1.5 percent on an organic basis, which
adjusts for the $59 million benefit
of foreign currency translation. Unless otherwise stated, all
revenue growth rates in this press release are stated on an organic
basis, which adjusts for the impact of foreign currency
translation. There were no acquisitions made in the last year that
had a significant impact on the company's second quarter revenue
growth.
As reported, second quarter GAAP net income and diluted earnings
per share (EPS) were $489 million and
$0.36, respectively. As detailed in
the financial schedules included through the link at the end of
this release, second quarter non-GAAP net income and non-GAAP
diluted EPS were $1.380 billion and
$1.02, respectively, both decreases
of 22 percent. Adjusting for the negative 4
cent impact from foreign currency, second quarter non-GAAP
diluted EPS decreased 19 percent.
Second quarter U.S. revenue of $4.054
billion represented 53 percent of company revenue and
decreased 2 percent as reported and organic. Non-U.S. developed
market revenue of $2.446 billion
represented 32 percent of company revenue and increased 6 percent
as reported and 1 percent organic. Emerging Markets revenue of
$1.147 billion represented 15 percent
of company revenue and decreased 9 percent as reported and 6
percent organic.
"We're seeing a faster-than-expected recovery and approaching
year-over-year growth. Our revenue growth is improving, our
pipeline is advancing, and we're gaining share in an increasing
number of businesses. At the same time, we're in the process of
implementing our new operating model and augmenting our culture
with a focus on market share and being bold," said Geoff Martha, Medtronic chief executive officer.
"Despite the challenges posed by the pandemic, we're well
positioned to accelerate growth over the medium- and long-term as
we continue investing in and progressing a number of opportunities,
creating value for society and our shareholders."
Cardiac and Vascular Group
The Cardiac and Vascular Group (CVG) includes the Cardiac Rhythm
& Heart Failure (CRHF), Coronary & Structural Heart (CSH),
and Aortic, Peripheral & Venous (APV) divisions. CVG second
quarter revenue of $2.725 billion
decreased 4.6 percent as reported and 5.5 percent organic. CVG's
revenue reflected a year-over-year decline in procedure volumes as
a result of the COVID-19 pandemic; however, revenue did improve
sequentially as procedures volumes continued to improve. CVG's
organic performance was impacted by low-single digit declines in
CRHF, mid-teens decline in CSH, and low-single digit declines in
APV.
- Cardiac Rhythm & Heart Failure second quarter
revenue of $1.426 billion was flat as
reported and decreased 1.3 percent organic. Arrhythmia Management
revenue, including implantable defibrillators (ICDs), Pacemakers,
Implantable Diagnostics, and Cardiac Ablation Solutions declined in
the low-single digits. This included mid-seventies growth in
Leadless Pacemakers, and specifically mid-eighties growth in
the United States, on the
continued global adoption of the company's Micra™ transcatheter
pacing systems. Heart Failure declined low-single digits, as flat
results in cardiac resynchronization therapy pacemakers (CRT-Ps)
and mid-twenties declines in left ventricular assist devices
(LVADs) were partially offset by mid-single digit growth in cardiac
resynchronization therapy defibrillators (CRT-Ds) from the recent
launch of Cobalt™ and Crome™.
- Coronary & Structural Heart second quarter revenue
of $831 million decreased 13.0
percent as reported and 13.6 organic, reflecting high-twenties
declines in drug-eluting stents (DES). The company experienced a
slowdown in DES sales in China
ahead of the national tender announcement in mid-October. In
addition, the company recorded a $26
million reserve as a result of the tender. Outside of
China, DES sales declined in the
mid-teens. While transcatheter aortic valves (TAVR) declined
high-single digits versus the prior year, the company estimates it
held share in the third calendar quarter versus the prior
quarter.
- Aortic, Peripheral & Venous second quarter revenue
of $468 million decreased 1.3 percent
as reported and 1.9 percent organic. Aortic grew in the low-single
digits, Peripheral declined in the low-single digits, and Venous
declined in the high-single digits.
Minimally Invasive Therapies Group
The Minimally Invasive Therapies Group (MITG) includes the Surgical
Innovations (SI) and the Respiratory, Gastrointestinal & Renal
(RGR) divisions. MITG second quarter revenue of $2.285 billion increased 6.7 percent as reported
and 6.2 percent organic. MITG's revenue reflected a year-over-year
decline in procedure volumes offset by increased demand for
COVID-19 related diagnostics and therapies. SI's mid-single digit
organic decline was offset by low-thirties organic growth in
RGR.
- Surgical Innovations second quarter revenue of
$1.393 billion decreased 4.2 percent
as reported and 4.9 percent organic. Advanced Surgical declined
low-single digits, reflecting the decline of worldwide surgical
procedures. General Surgery products declined in the high-single
digits.
- Respiratory, Gastrointestinal & Renal second quarter
revenue of $893 million increased
29.8 percent as reported and 29.7 organic, reflecting the increased
demand for Respiratory Interventions products. Respiratory &
Patient Monitoring grew in the low-forties, with sales of
ventilators increasing nearly four-fold, as the company increased
production of its PB980 high-acuity ventilator to address global
demand.
Restorative Therapies Group
The Restorative Therapies Group (RTG) includes the Cranial and
Spinal Technologies, Specialty Therapies, and Neuromodulation
divisions. RTG second quarter revenue of $2.063 billion decreased 2.3 percent as reported
and 2.9 percent organic. RTG's revenue reflected a year-over-year
decline in procedure volumes as a result of the COVID-19 pandemic.
RTG's organic performance this quarter included mid-single-digit
declines in Cranial and Spinal Technologies, flat results in
Specialty Therapies, and low-single digit declines in
Neuromodulation.
- Cranial and Spinal Technologies second quarter revenue
of $1.071 billion decreased 4.1
percent as reported and 4.6 organic, including low-single digit
declines in Spine and high-single digit declines in Enabling
Technology. Core Spine declined in the low-single digits globally
and grew in the low-single digits in the US. China Orthopedics
(Kanghui) grew in the high-single digits.
- Specialty Therapies second quarter revenue of
$581 million increased 1.0 percent as
reported and 0.3 percent organic. ENT declined in the high-single
digits, Neurovascular increased in the low-single digits, and
Pelvic Health increased in the mid-single digits.
- Neuromodulation second quarter revenue of $411 million decreased 2.1 percent as reported
and 3.1 percent organic, including mid-single digit declines in
Pain Therapies and low-single digit growth in DBS.
Diabetes Group
Diabetes Group second quarter revenue of $574 million decreased 3.7 percent as reported
and 5.0 percent organic. Diabetes Group revenue performance was
impacted by a delay in new patient starts on insulin pumps and
continued competitive pressure. CGM grew in the mid-single
digits.
Guidance
Given the uncertainty on near-term financial results caused by the
COVID-19 pandemic, the company is not providing formal annual or
quarterly financial guidance at this time.
Webcast Information
Medtronic will host a webcast today, November 24, at 8:00 a.m.
EST (7:00 a.m. CST) to provide
information about its businesses for the public, investors,
analysts, and news media. This quarterly webcast can be accessed by
clicking on the Investor Events link at
investorrelations.medtronic.com and this earnings release will
be archived at newsroom.medtronic.com. Medtronic will be live
tweeting during the webcast on its Newsroom Twitter account,
@Medtronic. Within 24 hours of the webcast, a replay of the webcast
and transcript of the company's prepared remarks will be available
by clicking on the Investor Events link at
investorrelations.medtronic.com.
Medtronic plans to report its fiscal year 2021 third and fourth
quarter results on Tuesday, February 23,
2021 and Thursday, May 27,
2021, respectively, and its fiscal year 2022 first quarter
results on August 24, 2021.
Confirmation and additional details will be provided closer to the
specific event.
Financial Schedules
To view the second quarter financial schedules and non-GAAP
reconciliations, click here. To view the second quarter
earnings presentation, click here. Both documents 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 90,000 people
worldwide, serving physicians, hospitals and patients in more than
150 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 within
the meaning of the Private Securities Litigation Reform Act of
1995, which are subject to risks and uncertainties, including risks
related to the impact COVID-19 has had and is expected to continue
to have on our business, operations and production, as well as
demand for our offerings, and on our employees, medical
professional and healthcare system, communities in which we
operate, and our financial results and condition, competitive
factors, difficulties and delays inherent in the development,
manufacturing, marketing and sale of medical products, government
regulation and general economic conditions and other risks and
uncertainties described in the company's periodic reports on file
with the U.S. Securities and Exchange Commission including the most
recent Annual Report on Form 10-K of the company, as filed with the
U.S. Securities and Exchange Commission. In some cases, you can
identify these statements by forward-looking words or expressions,
such as "anticipate," "believe," "could," "estimate," "expect,"
"forecast," "intend," "looking ahead," "may," "plan," "possible,"
"potential," "project," "should," "going to," "will," and similar
words or expressions, the negative or plural of such words or
expressions and other comparable terminology. Actual results may
differ materially from anticipated results. Medtronic does not
undertake to update its forward-looking statements or any of the
information contained in this press release, including to reflect
future events or circumstances.
NON-GAAP FINANCIAL MEASURES
This press release contains financial measures, including
adjusted net income, adjusted diluted EPS, and organic revenue,
which are considered "non-GAAP" financial measures under applicable
SEC rules and regulations. References to quarterly figures
increasing, decreasing or remaining flat are in comparison to the
second quarter of fiscal year 2020.
Medtronic management believes that non-GAAP financial
measures provide information useful to investors in understanding
the company's underlying operational performance and trends and to
facilitate comparisons with the performance of other companies in
the med tech industry. Non-GAAP net income and diluted EPS 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 schedules accompanying this press release.
View Second Quarter Financial Schedules & Non-GAAP
Reconciliations
View Second Quarter Earnings Presentation
Contacts:
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Erika
Winkels
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Ryan
Weispfenning
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Public
Relations
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Investor
Relations
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+1-763-526-8478
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+1-763-505-4626
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SOURCE Medtronic plc