Medtronic 2Q profit falls 35 percent on costs
Minneapolis (AP) — Medtronic's fiscal second-quarter net income fell 35 percent as legal and other costs outpaced weak gains in medical device sales, but adjusted results met Wall Street expectations.
The medical device maker, based in Minneapolis, said Tuesday its profit fell to $566 million, or 52 cents per share, from $868 million, or 78 cents per share, during the same period a year ago. Revenue rose less than 2 percent to $3.9 billion from $3.84 billion. The quarter ended Oct. 29.
The rise in sales was not enough to offset a 16 percent boost in expenses to $3.15 billion, driven by legal costs.
Excluding charges, Medtronic Inc. said it earned 82 cents per share. Analysts polled by Thomson Reuters expect earnings per share of 81 cents on revenue of $3.9 billion.
Global sales of cardiac and vascular products rose 1 percent to just over $2.09 billion. The unit sells defibrillators and pacemakers, which together make up the company's largest franchise.
Meanwhile, sales of restorative therapies, which include spinal, diabetes and other products, rose 2 percent to $1.81 billion. Within that group spinal revenue, which makes up the company's second largest franchise, fell 1 percent to $850 million.
Late Monday, Medtronic announced it would buy the remaining 89 percent of blood pressure treatment maker Ardian Inc. that it doesn't already own for $800 million in cash.
Looking ahead, the company expects full-year profit between $3.38 and $3.44 per share, below its prior range of $3.40 to $3.48 per share. The estimate excludes any potential impact from the pending Ardian deal. Analysts expect profit of $3.41 per share, on average.
In premarket trading, Medtronic shares slipped 19 cents to $34.51.
(Copyright 2010 by The Associated Press. All Rights Reserved.)