By Chelsey Dulaney
Medtronic PLC posted better-than-expected results in its January
quarter despite a hit from currency effects, in the last quarter
before the medical-device maker closed on its $43 billion merger
with Covidien PLC and reincorporated to Dublin.
The merger, combining two of the world's largest
surgical-implant and hospital-supply companies, closed in late
January after drawing scrutiny over a tax tactic criticized by U.S.
government officials. The acquisition involved Medtronic
reincorporating from Minneapolis to Ireland, lightening the
company's tax burden.
For the fiscal third-quarter ended Jan. 23, Medtronic reported
earnings of $977 million, up 28% from a year earlier. Per-share
earnings were 98 cents a share, up 31% from a year ago.
Excluding items, per-share earnings were $1.01.
Revenue grew 3.7% to $4.32 billion. Excluding a $158 million
negative impact from currency fluctuations, revenue was up 8%.
Analysts polled by Thomson Reuters had expected 97 cents a share
in earnings and $4.25 billion in revenue.
Medtronic said its U.S. revenue grew 8% to $2.46 billion, while
international revenue fell 2%. Sales from emerging markets grew 6%
in the quarter.
In its cardiac and vascular group, revenue grew 5%.
Medtronic's sales of implanted cardiac defibrillators, or ICDs,
have been hurt recently by competitive pressure from Boston
Scientific Corp. and St. Jude Medical Inc., rivals that have
increased their market share with new product launches. Medtronic
received U.S. regulatory approval in August for a new type of
defibrillator that it says reduces side effects, and which analysts
expect will help the company better compete against rivals.
Revenue in its restorative therapies group, which includes its
spine and neuromodulation divisions, grew 2%.
For its current quarter, Metronic said it expects its revenue to
grow 4% to 6% on a pro forma basis, excluding currency
fluctuations.
Write to Chelsey Dulaney at chelsey.dulaney@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires