(Rewrites first paragraph and adds outlook for year in first
through fourth paragraphs, updates share price in fifth
paragraph.)
DOW JONES NEWSWIRES
Medtronic Inc. (MDT) projected stronger earnings growth for the
just-started fiscal year, after it reported fiscal fourth-quarter
results that revealed challenges at its defibrillator business.
Medtronic earlier on Tuesday reported that its fiscal
fourth-quarter earnings fell 19% on restructuring and other charges
as the largest standalone medical-device maker in the U.S. reported
a small increase in total revenue that beat analysts'
expectations.
For the year, Medtronic expects per-share earnings growth of 6%
to 9% on revenue growth of 1% to 3% on a constant-currency basis.
For the most recent year, Medtronic reported that earnings rose 5%
excluding items, while revenue rose 2% excluding a favorable
foreign currency effect.
Analysts polled by Thomson Reuters forecast earnings growth for
fiscal 2012 of 7% to $3.62 a share and revenue growth of 5% to
$16.7 billion.
Shares were down 2.8% at $40.12 in premarket trading. The stock
through Monday's close is up 11% this year.
Medtronic has several new products it expects will help combat
various challenges, such as market-share pressure and pressure on
product prices amid tougher bargaining from hospitals. But growth
rates for top markets where it operates remain sluggish and
continue to challenge the whole industry.
The company in March said it resolved issues at two
manufacturing facilities cited in Food and Drug Administration
warning letters, clearing the way for important product approvals.
Medtronic also finally won FDA approval for its "Protecta"
implantable defibrillators, which should help it better compete
with rivals St. Jude Medical Inc. (STJ) and Boston Scientific Corp.
(BSX).
The company recently appointed General Electric Co.'s (GE) GE
Healthcare Systems Chief Executive Omar Ishrak as chairman and CEO
to succeed Bill Hawkins, who plans to retire.
For the quarter ended April 29, Medtronic reported a profit of
$776 million, or 72 cents a share, down from $954 million, or 86
cents a share, a year earlier. Excluding restructuring-related
charges and prior-year effect from the U.S. health-care overhaul,
earnings were up at 90 cents a share from 89 cents a share.
Revenue increased 2.4% to $4.3 billion and was flat excluding
currency fluctuations.
Analysts polled by Thomson Reuters forecast earnings of 92 cents
a share on revenue of $4.29 billion.
The company said revenue from its cardiac rhythm disease
management segment declined 7%, or 9% excluding currency
effects.
The smaller cardiovascular unit's revenue was up 16%, and 13%
excluding currency effects, while spinal-segment sales dropped 1%
and 2%, respectively.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
Tess.Stynes@dowjones.com