Medical device manufacturer Medtronic Inc. (NYSE: MDT) released 2Q 2008 results last week that inflicted some pain on investors. Total revenues increased by 2%. Sales outside the US increased 12%, but $73 million of that increase was due to currency exchange, not organic growth. Fully one-third of all Medtronic sales now originate outside the US.
CEO Bill Hawkins remains optimistic about "strong growth potential going forward," which is about as much of an admission one will get that the current numbers leave a lot to be desired. The company is focused on growing non-US sales, which is a smart move since Medtronic has already suspended US product shipments in its physio-control division due to unauthorized human bones used in some procedures. More recently, the recall of Fidelis cardioverter defibrillators in the company's largest division caused revenue to plummet by at least $130 million, in addition to $31 million inventory write-off.
On a positive note, the acquisition of Kyphon will begin to contribute to the bottom line in the spinal division sooner than expected, and both the diabetes and ear, nose and throat divisions posted 16% increases in revenue. The company expects final FDA approval for a drug-eluting stent by the end of the calendar year, so look for contributions to the cardiovascular bottom line in 2008.
Once again, OPEC has killed the goose that lays the golden egg
Closing Bell: Markets bounce after yesterday's sell-off; BA, F, GE, DOW all up, GS down 
Where have all the consumers gone?
Reader Comments (Page 1 of 1)
11-27-2007 @ 3:38PM
bob said...
what? physio-control makes difibulators.
"The company is focused on growing non-US sales, which is a smart move since Medtronic has already suspended US product shipments in its physio-control division due to unauthorized human bones used in some procedures. "
11-27-2007 @ 3:41PM
MC said...
Medtronic recalled Fidelis Leads, NOT ICD's. Leads and devices are not necessarily related and are generally interchangeable even between devices of different manufacturers. The suspension of shipments by their physio-control division was because of record's keeping unrelated to unauthorized use of human bones.
11-28-2007 @ 2:01PM
t wallace said...
I dont know who wrote the article but they are very misinformed. Foreign currency exchange gains are generally good in all quarters. They actually have people that look after this that make money for the company. You discredit this fact but if a company can do this on a regular basis this is just good business and all part of being a good business. Second most of the large multinational corporations are having their biggest impacts outside the US market and have been for some time. If you think this is unusual obviously you dont read to many financial statements. I just hate the fact people write articles that are both negative and b misinformed and then act like they are the ones that know everything in the future maybe check what your writing before you post an article actling like the king of the reporting world. YOU definitely are not