Medtronic Inc. the maker of Medical equipment announced its first quarter report on Tuesday. The company’s year-over-year profit declined, even though volume of sales has gone up. The adjusted earnings and revenues have exceeded the estimate of Wall Street.
In 2013, the net earning was $954 million. This year, it dropped to $871 million. EPS fell to $0.87 in 2014 from $0.93 in 2013. The adjusted earning per share excludes acquisition items and restructuring charges; this year it is $0.93. A year back it was $0.88. Analysts were expecting the adjusted earning per share to be $0.92 for the first quarter.
Medtronic’s revenue in 2014 saw an increase of 5% from the previous year. Last year the revenue was $4.06 billion and this year it increased to $4.27 billion.
The performance of individual units of Medtronic shows slow yet steady growth. The largest unit under Medtronic is the Cardiac and Vascular Group. Last year this segment earned a revenue of $2.25 billion. This year the revenue amount of this unit is $2.34 billion.
The surge in revenue is chiefly contributed by the rising sale of Cardiac Rhythm and Heart Failure devices. The sale of these devices has seen a 5% increase this year and totaled at $1.26 billion. Revenue that comes from Structural Heart and Coronary device segments saw a surge of 2% and stood at $766 million. Aortic and Peripheral device revenue increased to $232 million from $218 million.
Countrywise, revenue coming from US increased 6% in the first quarter and stood 42.3 billion from $2.1 billion of last year. As for international revenue, it grew 3% to $1.9 billion and up 2% on constant currency basis. In Q1, 45% of the company’s worldwide revenue came from international revenue. Revenue in the developing markets also increased 9% to $539 million.
The company representatives seem to be impressed with the result. The CEO of Medtronic Omar Ishrak said, “Our first quarter results are a solid start to fiscal year 2015. Our growth was broad based across businesses and geographies.” The company is up for acquiring Covidien Plc. which belongs to the same industry.
The acquisition will take place in late this year or early next year and it will give a boost to the growth of the company.