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DUBLIN – May 25, 2017 – Medtronic plc (NYSE: MDT) today announced financial results for its fourth quarter and fiscal year 2017, which ended April 28, 2017. The company reported fourth quarter worldwide revenue of $7.916 billion, compared to the $7.567 billion reported in the fourth quarter of fiscal year 2016, an increase of 5 percent on both a reported and constant currency basis. Foreign currency translation had a negative $37 million impact on fourth quarter revenue. As reported, fourth quarter GAAP net income and diluted earnings per share (EPS) were $1.163 billion and $0.84, respectively. As detailed in the financial schedules included through the link at the end of this release, fourth quarter non-GAAP net income and diluted earnings per share (EPS) were $1.836 billion and $1.33, an increase of 2 percent and 5 percent, respectively. Fourth quarter U.S. revenue of $4.403 billion represented 56 percent of company revenue and increased 4 percent. Non-U.S. developed market revenue of $2.452 billion represented 31 percent of company revenue and increased 2 percent, or 4 percent on a constant currency basis. Emerging market revenue of $1.061 billion represented 13 percent of company revenue and increased 11 percent, or 10 percent on a constant currency basis. Medtronic’s fiscal year 2017 revenue of $29.710 billion increased 3 percent, or approximately 5 percent on a constant currency, constant week basis. Foreign currency translation had a negative $34 million impact on fiscal year 2017 revenue. The first quarter of fiscal year 2017 contained 13 weeks, one less week than the first quarter of fiscal year 2016. The extra week occurs every six years as a result of the company’s 52-53 week fiscal year calendar. While it is difficult to calculate an exact impact from the extra week, the company estimates that it resulted in an approximate $450 million benefit to revenue and $0.08 to $0.10 benefit to non-GAAP diluted earnings per share (EPS) in the first quarter of the prior fiscal year. As reported, fiscal year 2017 net earnings were $4.028 billion or $2.89 per diluted share. As detailed in the link at the end of this release, fiscal year 2017 non-GAAP earnings and diluted EPS were $6.395 billion and $4.60, representing increases of approximately 8 to 9 percent and approximately 11 to 12 percent, respectively, on a constant currency, constant week basis. “Our fourth quarter results were a strong finish to the fiscal year, with balanced, diversified growth across our groups and regions,” said Omar Ishrak, Medtronic chairman and chief executive officer. “Fiscal year 2017 was a solid year overall for Medtronic. We delivered record revenue, made progress in each of our growth strategies, executed on our Covidien cost synergy commitments, generated strong free cash flow growth, and deployed our capital in line with our stated priorities, balancing the return of cash to our shareholders together with disciplined reinvestment in our businesses.” Cardiac and Vascular Group
Minimally Invasive Therapies Group
Restorative Therapies Group
Diabetes Group
Guidance In fiscal year 2018, the company expects constant currency revenue growth to be in the range of 4 to 5 percent. While the impact of foreign currency is fluid, if current exchange rates remain similar for the remainder of the fiscal year, the company’s revenue would be positively affected by approximately $75 million to $175 million for the fiscal year, including an approximate negative $10 to negative $60 million impact in the first fiscal quarter. In fiscal year 2018, the company expects diluted non-GAAP EPS growth to be in the range of 9 to 10 percent on a constant currency basis. Assuming current exchange rates remain similar for the rest of the year, the company’s non-GAAP EPS would be negatively affected by approximately $0.05 to $0.10, including an approximate $0.03 to $0.05 impact in the first fiscal quarter. The company reiterated its long-term expectation of mid-single digit revenue growth and double digit EPS growth, both on a constant currency basis. In addition, the company noted that the fiscal year 2018 outlook and guidance does not include the impact of the previously announced divestiture of a portion of its Patient Monitoring and Recovery division to Cardinal Health, which the company continues to expect to close in the second fiscal quarter. The company intends to update its guidance upon close of the transaction. “We are creating distinct competitive advantages and capitalizing on the long-term trends in healthcare: namely, the desire to improve clinical outcomes; the growing demand for expanded access to care; and the optimization of cost and efficiency within healthcare systems. These trends, along with an aging population in most countries, produce secular growth tailwinds that we believe represent sustainable, long-term opportunities for Medtronic,” said Ishrak. “As we look forward, we have a number of catalysts that make us optimistic about our ability to deliver on our commitments and expand patient access around the world to our products and services. Our leadership team and employees continue to focus on driving excellence and impact in all that we do, and we look forward to the fiscal year ahead.” Webcast Information Financial Schedules About Medtronic FORWARD LOOKING STATEMENTS NON-GAAP FINANCIAL MEASURES 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 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. 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 exchange 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, such as amortization of intangible assets and acquisition-related, certain tax and litigation, and restructuring charges or gains. 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. View FY17 Fourth Quarter Financial Schedules & Non-GAAP Reconciliations Contacts: |
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