MEDTRONIC PLC
WORLD WIDE REVENUE(1)
(Unaudited)
SECOND QUARTER | SECOND QUARTER YEAR-TO-DATE(2) | |||||||||||||||||||||||||||||
REPORTED | CONSTANT | REPORTED | CONSTANT | |||||||||||||||||||||||||||
CURRENCY | CURRENCY | |||||||||||||||||||||||||||||
(in millions) | FY21 | FY20 | Growth | Currency | FY21 | Growth | FY21 | FY20 | Growth | Currency | FY21 | Growth | ||||||||||||||||||
Impact(4) | Impact(4) | |||||||||||||||||||||||||||||
Cardiac & Vascular Group | $ | 2,725 | $ | 2,855 | (4.6)% | $ | 27 | $ | 2,698 | (5.5)% | $ | 5,158 | $ | 5,645 | (8.6)% | $ | (12) | $ | 5,170 | (8.4)% | ||||||||||
Cardiac Rhythm & Heart Failure | 1,426 | 1,426 | - | 18 | 1,408 | (1.3) | 2,673 | 2,807 | (4.8) | 2 | 2,671 | (4.8) | ||||||||||||||||||
Coronary & Structural Heart | 831 | 955 | (13.0) | 6 | 825 | (13.6) | 1,611 | 1,896 | (15.0) | (12) | 1,623 | (14.4) | ||||||||||||||||||
Aortic, Peripheral, & Venous | 468 | 474 | (1.3) | 3 | 465 | (1.9) | 873 | 942 | (7.3) | (3) | 876 | (7.0) | ||||||||||||||||||
Minimally Invasive Therapies Group | 2,285 | 2,142 | 6.7 | 11 | 2,274 | 6.2 | 4,086 | 4,242 | (3.7) | (27) | 4,113 | (3.0) | ||||||||||||||||||
Surgical Innovations | 1,393 | 1,454 | (4.2) | 10 | 1,383 | (4.9) | 2,473 | 2,871 | (13.9) | (15) | 2,488 | (13.3) | ||||||||||||||||||
Respiratory, Gastrointestinal, & Renal | 893 | 688 | 29.8 | 1 | 892 | 29.7 | 1,613 | 1,371 | 17.7 | (11) | 1,624 | 18.5 | ||||||||||||||||||
Restorative Therapies Group(3) | 2,063 | 2,112 | (2.3) | 13 | 2,050 | (2.9) | 3,774 | 4,124 | (8.5) | (4) | 3,778 | (8.4) | ||||||||||||||||||
Cranial & Spinal Technologies | 1,071 | 1,117 | (4.1) | 5 | 1,066 | (4.6) | 2,015 | 2,167 | (7.0) | (2) | 2,017 | (6.9) | ||||||||||||||||||
Specialty Therapies | 581 | 575 | 1.0 | 4 | 577 | 0.3 | 1,035 | 1,138 | (9.1) | (3) | 1,038 | (8.8) | ||||||||||||||||||
Neuromodulation | 411 | 420 | (2.1) | 4 | 407 | (3.1) | 725 | 818 | (11.4) | 1 | 724 | (11.5) | ||||||||||||||||||
Diabetes Group | 574 | 596 | (3.7) | 8 | 566 | (5.0) | 1,136 | 1,188 | (4.4) | (3) | 1,139 | (4.1) | ||||||||||||||||||
TOTAL | $ | 7,647 | $ | 7,706 | (0.8)% | $ | 59 | $ | 7,588 | (1.5)% | $ | 14,154 | $ | 15,199 | (6.9)% | $ | (46) | $ | 14,200 | (6.6)% |
- The data in this schedule has been intentionally rounded to the nearest million and, therefore, may not sum.
- Fiscal year 2021 is a 53-week fiscal year, with the extra week occurring in the first fiscal month of the first quarter and included in reported second quarter year-to-date results. While it is difficult to calculate the impact of the extra week, the Company estimates the extra week benefited second quarter year-to-date constant currency growth by approximately $360 to $390 million. Second quarter year-to-date revenue also includes $15 million of inorganic revenue related to the Titan Spine acquisition, which is included in the reported results of the Cranial & Spinal Technologies division of the Restorative Therapies Group. When excluding the impact of currency, inorganic Titan Spine revenue, and the estimated impact of the extra week, second quarter year-to-date revenue for fiscal year 2021 declined approximately 9 percent organic.
- In the first quarter of fiscal year 2021, the Company realigned its divisions within the Restorative Therapies Group. As a result, fiscal year 2020 results have been recast to adjust for this realignment.
- The currency impact to revenue measures the change in revenue between current and prior year periods using constant exchange rates.
MEDTRONIC PLC
U.S.(1)(2) REVENUE
(Unaudited)
SECOND QUARTER | SECOND QUARTER YEAR-TO-DATE | ||||||||||||||||
REPORTED | REPORTED | ||||||||||||||||
(in millions) | FY21 | FY20 | Growth | FY21 | FY20 | Growth | |||||||||||
Cardiac & Vascular Group | $ | 1,377 | $ | 1,455 | (5.4)% | $ | 2,582 | $ | 2,816 | (8.3)% | |||||||
Cardiac Rhythm & Heart Failure | 760 | 785 | (3.2) | 1,431 | 1,514 | (5.5) | |||||||||||
Coronary & Structural Heart | 357 | 403 | (11.4) | 663 | 779 | (14.9) | |||||||||||
Aortic, Peripheral, & Venous | 260 | 267 | (2.6) | 488 | 523 | (6.7) | |||||||||||
Minimally Invasive Therapies Group | 996 | 922 | 8.0 | 1,718 | 1,835 | (6.4) | |||||||||||
Surgical Innovations | 560 | 584 | (4.1) | 960 | 1,157 | (17.0) | |||||||||||
Respiratory, Gastrointestinal, & Renal | 436 | 338 | 29.0 | 758 | 679 | 11.6 | |||||||||||
Restorative Therapies Group(3) | 1,397 | 1,440 | (3.0) | 2,533 | 2,778 | (8.8) | |||||||||||
Cranial & Spinal Technologies | 770 | 802 | (4.0) | 1,462 | 1,544 | (5.3) | |||||||||||
Specialty Therapies | 346 | 351 | (1.4) | 588 | 687 | (14.4) | |||||||||||
Neuromodulation | 281 | 287 | (2.1) | 483 | 548 | (11.9) | |||||||||||
Diabetes Group | 284 | 311 | (8.7) | 572 | 618 | (7.4) | |||||||||||
TOTAL | $ | 4,054 | $ | 4,129 | (1.8)% | $ | 7,405 | $ | 8,046 | (8.0)% |
- U.S. includes the United States and U.S. territories.
- The data in this schedule has been intentionally rounded to the nearest million and, therefore, may not sum.
- In the first quarter of fiscal year 2021, the Company realigned its divisions within the Restorative Therapies Group. As a result, fiscal year 2020 results have been recast to adjust for this realignment.
MEDTRONIC PLC
WORLD WIDE REVENUE: GEOGRAPHIC (1)(2)
(Unaudited)
SECOND QUARTER | SECOND QUARTER YEAR-TO-DATE(3) | |||||||||||||||||||||||||||||||||
REPORTED | CONSTANT | REPORTED | CONSTANT | |||||||||||||||||||||||||||||||
CURRENCY | CURRENCY | |||||||||||||||||||||||||||||||||
(in millions) | FY21 | FY20 | Growth | Currency | FY21 | Growth | FY21 | FY20 | Growth | Currency | FY21 | Growth | ||||||||||||||||||||||
Impact(4) | Impact(4) | |||||||||||||||||||||||||||||||||
U.S. | $ | 1,377 | $ | 1,455 | (5.4) % | $ | - | $ | 1,377 | (5.4) % | $ | 2,582 | $ | 2,816 | (8.3) % | $ | - | $ | 2,582 | (8.3) % | ||||||||||||||
Non-U.S. Developed | 945 | 890 | 6.2 | 41 | 904 | 1.6 | 1,798 | 1,820 | (1.2) | 27 | 1,771 | (2.7) | ||||||||||||||||||||||
Emerging Markets | 404 | 510 | (20.8) | (15) | 419 | (17.8) | 778 | 1,009 | (22.9) | (39) | 817 | (19.0) | ||||||||||||||||||||||
Cardiac & Vascular Group | 2,725 | 2,855 | (4.6) | 27 | 2,698 | (5.5) | 5,158 | 5,645 | (8.6) | (12) | 5,170 | (8.4) | ||||||||||||||||||||||
U.S. | 996 | 922 | 8.0 | - | 996 | 8.0 | 1,718 | 1,835 | (6.4) | - | 1,718 | (6.4) | ||||||||||||||||||||||
Non-U.S. Developed | 837 | 782 | 7.0 | 31 | 806 | 3.1 | 1,556 | 1,573 | (1.1) | 20 | 1,536 | (2.4) | ||||||||||||||||||||||
Emerging Markets | 452 | 438 | 3.2 | (21) | 473 | 8.0 | 811 | 834 | (2.8) | (47) | 858 | 2.9 | ||||||||||||||||||||||
Minimally Invasive Therapies Group | 2,285 | 2,142 | 6.7 | 11 | 2,274 | 6.2 | 4,086 | 4,242 | (3.7) | (27) | 4,113 | (3.0) | ||||||||||||||||||||||
U.S. | 1,397 | 1,440 | (3.0) | - | 1,397 | (3.0) | 2,533 | 2,778 | (8.8) | - | 2,533 | (8.8) | ||||||||||||||||||||||
Non-U.S. Developed | 426 | 416 | 2.4 | 17 | 409 | (1.7) | 802 | 842 | (4.8) | 11 | 791 | (6.1) | ||||||||||||||||||||||
Emerging Markets | 240 | 256 | (6.3) | (4) | 244 | (4.7) | 439 | 504 | (12.9) | (15) | 454 | (9.9) | ||||||||||||||||||||||
Restorative Therapies Group | 2,063 | 2,112 | (2.3) | 13 | 2,050 | (2.9) | 3,774 | 4,124 | (8.5) | (4) | 3,778 | (8.4) | ||||||||||||||||||||||
U.S. | 284 | 311 | (8.7) | - | 284 | (8.7) | 572 | 618 | (7.4) | - | 572 | (7.4) | ||||||||||||||||||||||
Non-U.S. Developed | 238 | 226 | 5.3 | 12 | 226 | - | 465 | 457 | 1.8 | 6 | 459 | 0.4 | ||||||||||||||||||||||
Emerging Markets | 51 | 59 | (13.6) | (4) | 55 | (6.8) | 100 | 113 | (11.5) | (9) | 109 | (3.5) | ||||||||||||||||||||||
Diabetes Group | 574 | 596 | (3.7) | 8 | 566 | (5.0) | 1,136 | 1,188 | (4.4) | (3) | 1,139 | (4.1) | ||||||||||||||||||||||
U.S. | 4,054 | 4,129 | (1.8) | - | 4,054 | (1.8) | 7,405 | 8,046 | (8.0) | - | 7,405 | (8.0) | ||||||||||||||||||||||
Non-U.S. Developed | 2,446 | 2,315 | 5.7 | 101 | 2,345 | 1.3 | 4,621 | 4,692 | (1.5) | 64 | 4,557 | (2.9) | ||||||||||||||||||||||
Emerging Markets | 1,147 | 1,262 | (9.1) | (43) | 1,190 | (5.7) | 2,128 | 2,460 | (13.5) | (110) | 2,238 | (9.0) | ||||||||||||||||||||||
TOTAL | $ | 7,647 | $ | 7,706 | (0.8)% | $ | 59 | $ | 7,588 | (1.5)% | $ | 14,154 | $ | 15,199 | (6.9)% | $ | (46) | $ | 14,200 | (6.6)% |
- U.S. includes the United States and U.S. territories. Non-U.S. developed markets include Japan, Australia, New Zealand, Korea, Canada, and the countries of Western Europe. Emerging Markets include the countries of the Middle East, Africa, Latin America, Eastern Europe, and the countries of Asia that are not included in the non-U.S. developed markets, as previously defined.
- The data in this schedule has been intentionally rounded to the nearest million and, therefore, may not sum.
- Fiscal year 2021 is a 53-week fiscal year, with the extra week occurring in the first fiscal month of the first quarter and included in reported second quarter year-to-date results. While it is difficult to calculate the impact of the extra week, the Company estimates the extra week benefited second quarter year-to-date constant currency growth by approximately $360 to $390 million. Second quarter year-to-date revenue also includes $15 million of inorganic revenue related to the Titan Spine acquisition, which is included in the reported results of the Cranial & Spinal Technologies division of the Restorative Therapies Group. When excluding the impact of currency, inorganic Titan Spine revenue, and the estimated impact of the extra week, second quarter year-to-date revenue for fiscal year 2021 declined approximately 9 percent organic.
- The currency impact to revenue measures the change in revenue between current and prior year periods using constant exchange rates.
MEDTRONIC PLC
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three months ended | Six months ended | ||||||||||
(in millions, except per share data) | October 30, | October 25, | October 30, | October 25, | |||||||
2020 | 2019 | 2020 | 2019 | ||||||||
Net sales | $ | 7,647 | $ | 7,706 | $ | 14,154 | $ | 15,199 | |||
Costs and expenses: | |||||||||||
Cost of products sold | 2,705 | 2,394 | 5,209 | 4,760 | |||||||
Research and development expense | 639 | 603 | 1,260 | 1,190 | |||||||
Selling, general, and administrative expense | 2,600 | 2,620 | 5,017 | 5,163 | |||||||
Amortization of intangible assets | 443 | 441 | 884 | 881 | |||||||
Restructuring charges, net | 97 | 27 | 150 | 74 | |||||||
Certain litigation charges, net | 84 | 121 | (4) | 168 | |||||||
Other operating expense, net | 149 | 149 | 35 | 127 | |||||||
Operating profit | 930 | 1,351 | 1,603 | 2,836 | |||||||
Other non-operating income, net | (65) | (108) | (147) | (209) | |||||||
Interest expense | 470 | 165 | 641 | 774 | |||||||
Income before income taxes | 525 | 1,294 | 1,109 | 2,271 | |||||||
Income tax provision (benefit) | 31 | (77) | 124 | 23 | |||||||
Net income | 494 | 1,371 | 985 | 2,248 | |||||||
Net income attributable to noncontrolling interests | (5) | (7) | (9) | (20) | |||||||
Net income attributable to Medtronic | $ | 489 | $ | 1,364 | $ | 976 | $ | 2,228 | |||
Basic earnings per share | |||||||||||
$ | 0.36 | $ | 1.02 | $ | 0.73 | $ | 1.66 | ||||
Diluted earnings per share | |||||||||||
$ | 0.36 | $ | 1.01 | $ | 0.72 | $ | 1.65 | ||||
Basic weighted average shares outstanding | |||||||||||
1,344.4 | 1,340.8 | 1,343.1 | 1,340.8 | ||||||||
Diluted weighted average shares outstanding | 1,352.1 | 1,351.4 | 1,351.1 | 1,351.6 |
MEDTRONIC PLC
GAAP TO NON-GAAP RECONCILIATIONS
(Unaudited)
Three months ended October 30, 2020 | ||||||||||||||||||||||||
Income | ||||||||||||||||||||||||
Net | Cost of | Gross | Operating | Operating | Before | Net Income | Diluted | Effective | ||||||||||||||||
(in millions, except per share data) | Products | Margin | Profit | Income | Attributable | |||||||||||||||||||
Sales | Sold | Percent | Profit | Percent | Taxes | to Medtronic | EPS (1) | Tax Rate | ||||||||||||||||
GAAP | $ | 7,647 | $ | 2,705 | 64.6 % | $ | 930 | 12.2 % | $ | 525 | $ | 489 | $ | 0.36 | 5.9 | % | ||||||||
Non-GAAP Adjustments: | ||||||||||||||||||||||||
Restructuring and associated costs (2) | - | (32) | 0.4 | 179 | 2.3 | 179 | 135 | 0.10 | 24.6 | |||||||||||||||
Acquisition-related items (3) | - | (2) | - | 37 | 0.5 | 37 | 31 | 0.02 | 16.2 | |||||||||||||||
Certain litigation charges | - | - | - | 84 | 1.1 | 84 | 63 | 0.05 | 25.0 | |||||||||||||||
(Gain)/loss on minority investments (4) | - | - | - | - | - | 1 | 1 | - | - | |||||||||||||||
IPR&D charges (5) | - | - | - | 10 | 0.1 | 10 | 8 | 0.01 | 20.0 | |||||||||||||||
Medical device regulations (6) | - | (11) | 0.1 | 19 | 0.2 | 19 | 16 | 0.01 | 15.8 | |||||||||||||||
Amortization of intangible assets | - | - | - | 443 | 5.8 | 443 | 373 | 0.28 | 15.8 | |||||||||||||||
Debt tender premium (7) | - | - | - | - | - | 308 | 248 | 0.18 | 19.5 | |||||||||||||||
Certain tax adjustments, net (8) | - | - | - | - | - | - | 16 | 0.01 | - | |||||||||||||||
Non-GAAP | $ | 7,647 | $ | 2,660 | 65.2 % | $ | 1,702 | 22.3 % | $ | 1,606 | $ | 1,380 | $ | 1.02 | 13.8 % | |||||||||
Currency impact | (59) | (47) | 0.4 | 66 | 1.0 | 0.04 | ||||||||||||||||||
Currency Adjusted | $ | 7,588 | $ | 2,613 | 65.6 % | $ | 1,768 | 23.3 % | $ | 1.06 | ||||||||||||||
Three months ended October 25, 2019 | ||||||||||||||||||||||||
Income | ||||||||||||||||||||||||
Net | Cost of | Gross | Operating | Operating | Before | Net Income | Diluted | Effective | ||||||||||||||||
(in millions, except per share data) | Products | Margin | Profit | Income | Attributable | |||||||||||||||||||
Sales | Sold | Percent | Profit | Percent | Taxes | to Medtronic | EPS (1) | Tax Rate | ||||||||||||||||
GAAP | $ | 7,706 | $ | 2,394 | 68.9 % | $ | 1,351 | 17.5 % | $ | 1,294 | $ | 1,364 | $ | 1.01 | (6.0) % | |||||||||
Non-GAAP Adjustments: | ||||||||||||||||||||||||
Restructuring and associated costs (2) | - | (32) | 0.4 | 94 | 1.2 | 94 | 78 | 0.06 | 17.0 | |||||||||||||||
Acquisition-related items (9) | - | - | - | 27 | 0.4 | 27 | 23 | 0.02 | 14.8 | |||||||||||||||
Certain litigation charges | - | - | - | 121 | 1.6 | 121 | 93 | 0.07 | 23.1 | |||||||||||||||
(Gain)/loss on minority investments (4) | - | - | - | - | - | (12) | (10) | (0.01) | 16.7 | |||||||||||||||
Medical device regulations (6) | - | (4) | 0.1 | 10 | 0.1 | 10 | 9 | 0.01 | 10.0 | |||||||||||||||
Exit of businesses (10) | - | - | - | 41 | 0.5 | 41 | 35 | 0.03 | 14.6 | |||||||||||||||
Contribution to Medtronic Foundation | - | - | - | 80 | 1.0 | 80 | 62 | 0.05 | 22.5 | |||||||||||||||
Amortization of intangible assets | - | - | - | 441 | 5.7 | 441 | 374 | 0.28 | 15.2 | |||||||||||||||
Certain tax adjustments, net (11) | - | - | - | - | - | - | (251) | (0.19) | - | |||||||||||||||
Non-GAAP | $ | 7,706 | $ | 2,358 | 69.4 % | $ | 2,165 | 28.1 % | $ | 2,096 | $ | 1,777 | $ | 1.31 | 14.9 | % | ||||||||
See description of non-GAAP financial measures at the end of the earnings press release.
- The data in this schedule has been intentionally rounded to the nearest $0.01 and, therefore, may not sum.
- Associated costs include costs incurred as a direct result of the restructuring program, such as salaries for employees supporting the program and consulting expenses.
- The charges primarily include business combination costs and changes in fair value of contingent consideration.
- We exclude unrealized and realized gains and losses on our minority investments as we do not believe that these components of income or expense have a direct correlation to our ongoing or future business operations.
- The charges relate to certain license payments for unapproved technology.
- The charges represent incremental costs of complying with the new European Union medical device regulations for previously registered products and primarily include charges for contractors supporting the project and other direct third- party expenses.
- The charges relate to the early redemption of approximately $6.0 billion of debt.
- Relates to the amortization of previously established deferred tax assets from intercompany intellectual property transactions.
- The charges primarily include costs incurred in connection with legacy-Covidien enterprise resource planning deployment activities, business combination related costs, and changes in the fair value of contingent consideration.
- The net charge relates to the exit of businesses and is primarily comprised of intangible asset impairments.
- The benefit relates to the impact of tax reform in Switzerland.
MEDTRONIC PLC
GAAP TO NON-GAAP RECONCILIATIONS
(Unaudited)
Six months ended October 30, 2020 | |||||||||||||||||||||||
Cost of | Gross | Operating | Income | Net Income | |||||||||||||||||||
Operating | Before | Diluted | Effective | ||||||||||||||||||||
(in millions, except per share data) | Net Sales | Products | Margin | Profit | Income | attributable | |||||||||||||||||
Sold | Percent | Profit | Percent | Taxes | to Medtronic | EPS (1) | Tax Rate | ||||||||||||||||
GAAP | $ 14,154 | $ | 5,209 | 63.2 % | $ | 1,603 | 11.3 % | $ | 1,109 | $ | 976 | $ | 0.72 | 11.2 % | |||||||||
Non-GAAP Adjustments: | |||||||||||||||||||||||
Restructuring and associated costs (2) | - | (59) | 0.4 | 307 | 2.2 | 307 | 241 | 0.18 | 21.5 | ||||||||||||||
Acquisition-related items (3) | - | (5) | - | (68) | (0.5) | (68) | (44) | (0.03) | 35.3 | ||||||||||||||
Certain litigation charges | - | - | - | (4) | - | (4) | (6) | - | (50.0) | ||||||||||||||
(Gain)/loss on minority investments (4) | - | - | - | - | - | (9) | (10) | (0.01) | (11.1) | ||||||||||||||
IPR&D charges (5) | - | - | - | 19 | 0.1 | 19 | 16 | 0.01 | 15.8 | ||||||||||||||
Medical device regulations (6) | - | (20) | 0.1 | 37 | 0.3 | 37 | 32 | 0.02 | 13.5 | ||||||||||||||
Amortization of intangible assets | - | - | - | 884 | 6.2 | 884 | 743 | 0.55 | 16.0 | ||||||||||||||
Debt tender premium and other charges | - | - | - | - | - | 308 | 248 | 0.18 | 19.5 | ||||||||||||||
(7) | |||||||||||||||||||||||
Certain tax adjustments, net | - | - | - | - | - | - | 20 | 0.01 | - | ||||||||||||||
Non-GAAP | $ 14,154 | $ | 5,125 | 63.8 % | $ | 2,778 | 19.6 % | $ | 2,583 | $ | 2,216 | $ | 1.64 | 13.9 % | |||||||||
Currency impact | 46 | (8) | 0.2 | 137 | 0.9 | 0.08 | |||||||||||||||||
Currency Adjusted | $ 14,200 | $ | 5,117 | 64.0 % | $ | 2,915 | 20.5 % | $ | 1.72 | ||||||||||||||
Six months ended October 25, 2019 | |||||||||||||||||||||||
Cost of | Gross | Operating | Income | Net Income | |||||||||||||||||||
Operating | Before | Diluted | Effective | ||||||||||||||||||||
(in millions, except per share data) | Net Sales | Products | Margin | Profit | Income | attributable | |||||||||||||||||
Sold | Percent | Profit | Percent | Taxes | to Medtronic | EPS (1) | Tax Rate | ||||||||||||||||
GAAP | $ 15,199 | $ | 4,760 | 68.7 % | $ | 2,836 | 18.7 % | $ | 2,271 | $ | 2,228 | $ | 1.65 | 1.0 % | |||||||||
Non-GAAP Adjustments: | |||||||||||||||||||||||
Restructuring and associated costs (2) | - | (67) | 0.4 | 218 | 1.4 | 218 | 187 | 0.14 | 14.2 | ||||||||||||||
Acquisition-related items (8) | - | - | - | 46 | 0.3 | 46 | 40 | 0.03 | 13.0 | ||||||||||||||
Certain litigation charges | - | - | - | 168 | 1.1 | 168 | 136 | 0.10 | 19.0 | ||||||||||||||
(Gain)/loss on minority investments (4) | - | - | - | - | - | (11) | (9) | (0.01) | 18.2 | ||||||||||||||
Debt tender premium and other charges | - | - | - | (7) | - | 406 | 320 | 0.24 | 21.2 | ||||||||||||||
(9) | |||||||||||||||||||||||
Medical device regulations (6) | - | (7) | - | 18 | 0.1 | 18 | 16 | 0.01 | 11.1 | ||||||||||||||
Exit of business (10) | - | - | - | 41 | 0.3 | 41 | 35 | 0.03 | 14.6 | ||||||||||||||
Contribution to Medtronic Foundation | - | - | - | 80 | 0.5 | 80 | 62 | 0.05 | 25.5 | ||||||||||||||
Amortization of intangible assets | - | - | - | 881 | 5.8 | 881 | 746 | 0.55 | 15.3 | ||||||||||||||
Certain tax adjustments, net (11) | - | - | - | - | - | - | (281) | (0.21) | - | ||||||||||||||
Non-GAAP | $ 15,199 | $ | 4,686 | 69.2 % | $ | 4,281 | 28.2 % | $ | 4,118 | $ | 3,480 | $ | 2.57 | 15.0 % | |||||||||
See description of non-GAAP financial measures contained in this release.
- The data in this schedule has been intentionally rounded to the nearest $0.01 and, therefore, may not sum.
- Associated costs include costs incurred as a direct result of the restructuring program, such as salaries for employees supporting the program and consulting expenses.
- The charges primarily include business combination costs, changes in fair value of contingent consideration, and a change in amounts accrued for certain contingent liabilities for recent acquisitions.
- We exclude unrealized and realized gains and losses on our minority investments as we do not believe that these components of income or expense have a direct correlation to our ongoing or future business operations.
- The charges relate to certain license payments for unapproved technology.
- The charges represent incremental costs of complying with the new European Union medical device regulations for previously registered products and primarily include charges for contractors supporting the project and other direct third- party expenses.
- The charges relate to the early redemption of approximately $6.0 billion of debt.
- The charges primarily include costs incurred in connection with legacy-Covidien enterprise resource planning deployment activities, business combination related costs, and changes in fair value of contingent consideration.
- The charges, which include $413 million recognized in interest expense and ($7 million) recognized in other operating expense, net, primarily relate to the early redemption of approximately $5.2 billion of debt.
- The net charges relate to the exit of businesses and are primarily comprised of intangible asset impairments.
- The net benefit primarily relates to the impact of tax reform in Switzerland and the United States.
MEDTRONIC PLC
GAAP TO NON-GAAP RECONCILIATIONS
(Unaudited)
Three months ended October 30, 2020 | ||||||||||||||||||||
SG&A | R&D | Other | Other | |||||||||||||||||
Operating | Operating | Other Non- | ||||||||||||||||||
SG&A | Expense as | R&D | Expense | (Income) | Expense, net | |||||||||||||||
(in millions) | Net Sales | a % of Net | as a % of | Expense, | as a % of | Operating | ||||||||||||||
Expense | Sales | Expense | Net Sales | net | Net Sales | Income, net | ||||||||||||||
GAAP | $ | 7,647 | $ | 2,600 | 34.0 % | $ | 639 | 8.4 % | $ | 149 | 1.9 % | $ | (65) | |||||||
Non-GAAP Adjustments: | ||||||||||||||||||||
Restructuring and associated costs (1) | - | (49) | (0.6) | - | - | - | - | - | ||||||||||||
Acquisition-related items (2) | - | (2) | - | - | - | (33) | (0.4) | - | ||||||||||||
IPR&D charges (3) | - | - | - | - | - | (10) | (0.1) | - | ||||||||||||
Medical device regulations (4) | - | - | - | (9) | (0.1) | - | - | - | ||||||||||||
Gain/(loss) on minority investments (5) | - | - | - | - | - | - | - | (1) | ||||||||||||
Non-GAAP | $ | 7,647 | $ | 2,549 | 33.3 % | $ | 630 | 8.2 % | $ | 106 | 1.4 % | $ | (66) | |||||||
Currency impact | (59) | (13) | 0.1 | (2) | 0.1 | (63) | (0.8) | - | ||||||||||||
Currency Adjusted | $ | 7,588 | $ | 2,536 | 33.4 % | $ | 628 | 8.3 % | $ | 43 | 0.6 % | $ | (66) | |||||||
See description of non-GAAP financial measures at the end of the earnings press release.
- Associated costs include costs incurred as a direct result of the restructuring program, such as salaries for employees supporting the program and consulting expenses.
- The charges primarily include business combination costs and changes in fair value of contingent consideration.
- The charges relate to certain license payments for unapproved technology.
- The charges represent incremental costs of complying with the new European Union medical device regulations for previously registered products and primarily include charges for contractors supporting the project and other direct third- party expenses.
- We exclude unrealized and realized gains and losses on our minority investments as we do not believe that these components of income or expense have a direct correlation to our ongoing or future business operations.
MEDTRONIC PLC
GAAP TO NON-GAAP RECONCILIATIONS
(Unaudited)
Six months ended October 30, 2020 | ||||||||||||||||||||
SG&A | R&D | Other | Other | |||||||||||||||||
Operating | Operating | Other Non- | ||||||||||||||||||
SG&A | Expense as | R&D | Expense | (Income) | Expense, net | |||||||||||||||
(in millions) | Net Sales | a % of Net | as a % of | Expense, | as a % of | Operating | ||||||||||||||
Expense | Sales | Expense | Net Sales | net | Net Sales | Income, net | ||||||||||||||
GAAP | $ | 14,154 | $ | 5,017 | 35.4 % | $ | 1,260 | 8.9 % | $ | 35 | 0.2 % | $ | (147) | |||||||
Non-GAAP Adjustments: | ||||||||||||||||||||
Restructuring and associated costs (1) | - | (98) | (0.7) | - | - | - | - | - | ||||||||||||
Acquisition-related items (2) | - | (2) | - | - | - | 75 | 0.5 | - | ||||||||||||
IPR&D charges (3) | - | - | - | - | - | (19) | (0.1) | - | ||||||||||||
Medical device regulations (4) | - | - | - | (17) | (0.1) | - | - | - | ||||||||||||
Gain/(loss) on minority investments (5) | - | - | - | - | - | - | - | 9 | ||||||||||||
Non-GAAP | $ | 14,154 | $ | 4,917 | 34.7 % | $ | 1,243 | 8.8 % | $ | 91 | 0.6 % | $ | (138) | |||||||
Currency impact | 46 | 17 | - | - | - | (100) | (0.7) | - | ||||||||||||
Currency Adjusted | $ | 14,200 | $ | 4,934 | 34.7 % | $ | 1,243 | 8.8 % | $ | (9) | (0.1)% | $ | (138) | |||||||
See description of non-GAAP financial measures at the end of the earnings press release.
- Associated costs include costs incurred as a direct result of the restructuring program, such as salaries for employees supporting the program and consulting expenses.
- The charges primarily include business combination costs, changes in fair value of contingent consideration, and a change in amounts accrued for certain contingent liabilities for recent acquisitions.
- The charges relate to certain license payments for unapproved technology.
- The charges represent incremental costs of complying with the new European Union medical device regulations for previously registered products and primarily include charges for contractors supporting the project and other direct third- party expenses.
- We exclude unrealized and realized gains and losses on our minority investments as we do not believe that these components of income or expense have a direct correlation to our ongoing or future business operations.
MEDTRONIC PLC
GAAP TO NON-GAAP RECONCILIATIONS
(Unaudited)
Six months | Three months | Three months | Fiscal year | Fiscal year | ||||||||||
ended | ended | ended | ||||||||||||
(in millions) | October 30, 2020 | October 30, 2020 | October 25, 2019 | 2020 | 2019 | |||||||||
Net cash provided by operating activities | $ | 2,139 | $ | 1,861 | $ | 1,867 | $ | 7,234 | $ | 7,007 | ||||
Additions to property, plant, and equipment | (615) | (281) | (283) | (1,213) | (1,134) | |||||||||
Free Cash Flow (1) | $ | 1,524 | $ | 1,580 | $ | 1,584 | $ | 6,021 | $ | 5,873 | ||||
See description of non-GAAP financial measures at the end of the earnings press release.
(1) Free cash flow represents operating cash flows less property, plant, and equipment additions.
MEDTRONIC PLC
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in millions) | October 30, 2020 | April 24, 2020 | |||
ASSETS | |||||
Current assets: | $ | 6,420 | $ | 4,140 | |
Cash and cash equivalents | |||||
Investments | 7,857 | 6,808 | |||
Accounts receivable, less allowances and credit losses of $312 and $208, respectively | 5,348 | 4,645 | |||
Inventories, net | 4,484 | 4,229 | |||
Other current assets | 1,927 | 2,209 | |||
Total current assets | 26,036 | 22,031 | |||
Property, plant, and equipment | 12,198 | 11,644 | |||
Accumulated depreciation | (7,260) | (6,816) | |||
Property, plant, and equipment, net | 4,938 | 4,828 | |||
Goodwill | 41,212 | 39,841 | |||
Other intangible assets, net | 18,412 | 19,063 | |||
Tax assets | 3,176 | 2,832 | |||
Other assets | 2,112 | 2,094 | |||
Total assets | $ | 95,886 | $ | 90,689 | |
LIABILITIES AND EQUITY | |||||
Current liabilities: | $ | 4,041 | $ | 2,776 | |
Current debt obligations | |||||
Accounts payable | 1,902 | 1,996 | |||
Accrued compensation | 2,133 | 2,099 | |||
Accrued income taxes | 406 | 502 | |||
Other accrued expenses | 3,589 | 2,993 | |||
Total current liabilities | 12,071 | 10,366 | |||
Long-term debt | 25,967 | 22,021 | |||
Accrued compensation and retirement benefits | 2,024 | 1,910 | |||
Accrued income taxes | 2,569 | 2,682 | |||
Deferred tax liabilities | 1,251 | 1,174 | |||
Other liabilities | 1,688 | 1,664 | |||
Total liabilities | 45,570 | 39,817 | |||
Commitments and contingencies | |||||
Shareholders' equity: | |||||
Ordinary shares- par value $0.0001, 2.6 billion shares authorized, 1,345,547,814 and | |||||
1,341,074,724 shares issued and outstanding, respectively | - | - | |||
Additional paid-in capital | 26,481 | 26,165 | |||
Retained earnings | 27,526 | 28,132 | |||
Accumulated other comprehensive loss | (3,843) | (3,560) | |||
Total shareholders' equity | 50,164 | 50,737 | |||
Noncontrolling interests | 152 | 135 | |||
Total equity | 50,316 | 50,872 | |||
Total liabilities and equity | $ | 95,886 | $ | 90,689 | |
MEDTRONIC PLC
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six months ended | |||||
(in millions) | October 30, 2020 | October 25, 2019 | |||
Operating Activities: | $ | 985 | $ | 2,248 | |
Net income | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | 1,340 | 1,328 | |||
Depreciation and amortization | |||||
Provision for doubtful accounts | 86 | 44 | |||
Deferred income taxes | (69) | (245) | |||
Stock-based compensation | 210 | 169 | |||
Loss on debt extinguishment | 308 | 406 | |||
Other, net | 112 | 119 | |||
Change in operating assets and liabilities, net of acquisitions and divestitures: | (669) | 39 | |||
Accounts receivable, net | |||||
Inventories, net | (145) | (267) | |||
Accounts payable and accrued liabilities | 108 | (294) | |||
Other operating assets and liabilities | (127) | (170) | |||
Net cash provided by operating activities | 2,139 | 3,377 | |||
Investing Activities: | (370) | (201) | |||
Acquisitions, net of cash acquired | |||||
Additions to property, plant, and equipment | (615) | (584) | |||
Purchases of investments | (5,360) | (4,226) | |||
Sales and maturities of investments | 4,337 | 3,260 | |||
Other investing activities | (4) | (16) | |||
Net cash used in investing activities | (2,012) | (1,767) | |||
Financing Activities: | (57) | 42 | |||
Change in current debt obligations, net | |||||
Proceeds from short-term borrowings (maturities greater than 90 days) | 2,789 | - | |||
Issuance of long-term debt | 7,172 | 5,568 | |||
Payments on long-term debt | (6,336) | (5,594) | |||
Dividends to shareholders | (1,558) | (1,447) | |||
Issuance of ordinary shares | 119 | 432 | |||
Repurchase of ordinary shares | (68) | (962) | |||
Other financing activities | (70) | (54) | |||
Net cash provided by (used in) financing activities | 1,991 | (2,015) | |||
Effect of exchange rate changes on cash and cash equivalents | 162 | (26) | |||
Net change in cash and cash equivalents | 2,280 | (431) | |||
Cash and cash equivalents at beginning of period | 4,140 | 4,393 | |||
Cash and cash equivalents at end of period | $ | 6,420 | $ | 3,962 | |
Supplemental Cash Flow Information | |||||
Cash paid for: | $ | 384 | $ | 494 | |
Income taxes | |||||
Interest | 321 | 322 |
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Medtronic plc published this content on 24 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 November 2020 12:02:07 UTC