Exhibit 99.1
ST. JUDE MEDICAL REPORTS SECOND QUARTER SALES AND EARNINGS
St. Paul, MN, July 20, 2005 — St. Jude Medical, Inc. (NYSE:STJ) today reported results for the second quarter ended June 30, 2005. The Company reported net sales of $724 million, an increase of 30% compared to the $557 million reported in the second quarter of 2004. Favorable foreign currency translation comparisons increased second quarter sales by about $12 million.
Reported net earnings for the second quarter of 2005 were $101 million or $.27 per diluted share, compared to $99 million, or $.27 per diluted share in the second quarter of 2004. Earnings per diluted share were $.59 for the first half of 2005, a 13% increase over the $.52 per share reported in the first half of 2004.
During the second quarter of 2005, St. Jude Medical recorded a special charge for the purchase of in-process research and development of approximately $14 million in conjunction with the completion of the acquisition of Velocimed, LLC. The company also recognized $27 million of additional income tax expense related to the repatriation of $500 million during the quarter under the provisions of the American Jobs Creation Act of 2004. Net earnings for the second quarter, excluding these non-recurring items, were $142 million or $.38 per diluted share, an increase of 41% over the $.27 per diluted share reported in the comparable quarter of 2004.
Second quarter ICD product sales were $244 million, a 92% increase over the comparable quarter of 2004, continuing to underscore the competitiveness of St. Jude Medical’s ICD products and reflecting additional market share gains. Second quarter pacemaker sales were $237 million, an increase of 4% from the comparable quarter of 2004.
Atrial fibrillation product sales for the second quarter totaled $61 million, a 65% increase over the second quarter of 2004. Sales of atrial fibrillation products in 2005 include sales from businesses acquired since the second quarter of 2004.
Total sales of cardiology products for the second quarter were $112 million, a 19% increase over 2004. Within this category of products, vascular sealing device sales for the second quarter of 2005 totaled $85 million, a 21% increase over the second quarter of last year.
Total cardiac surgery sales for the second quarter of 2005 were $70 million, a decrease of 3% compared to the second quarter of last year. Sales of heart valve products this quarter were approximately $65 million, down 3% when compared with the second quarter of last year.
Commenting on second quarter 2005 results, St. Jude Medical Chairman, President and Chief Executive Officer Daniel J. Starks said, “Our second quarter results reflect our progress on several major initiatives. Ninety-two percent growth in ICD revenues demonstrates clear and encouraging gains of ICD market share. We simultaneously strengthened our gross margin and expanded our investment in research and development. We completed our acquisition of Velocimed and continued to focus on expanding growth drivers to sustain our success.”
During a conference call today at 9 a.m. Eastern (8 a.m. Central), St. Jude Medical will further discuss these results and provide sales and earnings guidance for the third quarter and full year 2005. The Company expects its consolidated EPS for the third quarter of 2005 to be in the range of $.38 to $.39 per diluted share and is raising EPS guidance for the full year 2005 to be in the range of $1.49 to $1.51. The Company’s guidance excludes the impact of non-recurring items.
St. Jude Medical’s 2nd quarter earnings conference call will be live (also archived for 90 days) on the following website:
http://phx.corporate-ir.net/phoenix.zhtml?c=73836&p=irol-EventDetails&EventId=985469.
St. Jude Medical, Inc. (www.sjm.com) is dedicated to the design, manufacture and distribution of innovative medical devices of the highest quality, offering physicians, patients and payers outstanding clinical performance and demonstrated economic value.
Any statements made regarding the Company’s anticipated future product launches, regulatory approvals, revenues, earnings, market shares, and potential clinical success are forward-looking statements which are subject to risks and uncertainties, such as those described in the Financial Section of the Company’s Annual Report to Shareholders for the fiscal year ended December 31, 2004 (see page 16). Actual results may differ materially from anticipated results.
Condensed Consolidated Statements of Earnings
(Data in Thousands, Except EPS)
(Unaudited)
| Three Months Ended June 30, 2005 | Three Months Ended June 30, 2004 | | Six Months Ended June 30, 2005 | Six Months Ended June 30, 2004 |
---|
|
| Reported | | Adjustments | | Adjusted | | Reported | | Reported | | Adjustments | | Adjusted | | Reported |
---|
|
Net sales | | | $ | 723,655 | | | | | $ | 723,655 | | $ | 556,602 | | $ | 1,387,564 | | | | | $ | 1,387,564 | | $ | 1,105,178 | |
Cost of sales | | | | 201,018 | | | | | | 201,018 | | | 161,451 | | | 388,901 | | | | | | 388,901 | | | 325,696 | |
Gross profit | | | | 522,637 | | | | | | 522,637 | | | 395,151 | | | 998,663 | | | | | | 998,663 | | | 779,482 | |
|
Selling, general & administrative | | | | 237,586 | | | | | | 237,586 | | | 191,755 | | | 456,633 | | | | | | 456,633 | | | 379,304 | |
Research & development | | | | 89,807 | | | | | | 89,807 | | | 68,870 | | | 166,792 | | | | | | 166,792 | | | 134,450 | |
Purchased R&D | | | | 13,700 | | | (13,700 | ) | | | | | | | | 26,100 | | | (26,100 | ) | | | | | | |
|
Operating profit | | | | 181,544 | | | 13,700 | | | 195,244 | | | 134,526 | | | 349,138 | | | 26,100 | | | 375,238 | | | 265,728 | |
Other income (expense) | | | | 1,389 | | | | | | 1,389 | | | 121 | | | 3,121 | | | | | | 3,121 | | | (1,444 | ) |
|
Earnings before taxes | | | | 182,933 | | | 13,700 | | | 196,633 | | | 134,647 | | | 352,259 | | | 26,100 | | | 378,359 | | | 264,284 | |
Income tax expense | | | | 81,452 | | | (27,000 | ) | | 54,452 | | | 35,804 | | | 131,427 | | | (27,000 | ) | | 104,427 | | | 70,287 | |
Net earnings | | | $ | 101,481 | | $ | 40,700 | | $ | 142,181 | | $ | 98,843 | | $ | 220,832 | | $ | 53,100 | | $ | 273,932 | | $ | 193,997 | |
|
Earnings per share | | |
Basic | | | $ | 0.28 | | $ | 0.11 | | $ | 0.39 | | $ | 0.28 | | $ | 0.61 | | $ | 0.15 | | $ | 0.76 | | $ | 0.55 | |
Diluted | | | $ | 0.27 | | $ | 0.11 | | $ | 0.38 | | $ | 0.27 | | $ | 0.59 | | $ | 0.15 | | $ | 0.73 | | $ | 0.52 | |
|
Basic shares outstanding | | | | 362,419 | | | 362,419 | | | 362,419 | | | 352,605 | | | 361,361 | | | 361,361 | | | 361,361 | | | 350,889 | |
Diluted shares outstanding | | | | 376,964 | | | 362,419 | | | 376,964 | | | 370,823 | | | 376,247 | | | 361,361 | | | 376,247 | | | 369,533 | |
Condensed Consolidated Balance Sheets
(Data in Thousands)
(Unaudited)
| June 30, 2005 | | Dec. 31, 2004 |
---|
|
Cash & equivalents | | | $ | 517,450 | | $ | 688,040 | |
Accounts receivable, net | | | | 699,589 | | | 630,983 | |
Inventories | | | | 334,663 | | | 330,873 | |
Other current assets | | | | 228,013 | | | 213,321 | |
Property, plant & equipment, net | | | | 355,624 | | | 326,981 | |
Goodwill | | | | 794,594 | | | 593,799 | |
Other tangible assets, net | | | | 313,251 | | | 207,096 | |
Other assets | | | | 242,223 | | | 239,654 | |
Total assets | | | $ | 3,485,407 | | $ | 3,230,747 | |
|
Other current liabilities | | | $ | 635,653 | | $ | 605,393 | |
Long-term debt | | | | 188,986 | | | 234,865 | |
Deferred income taxes | | | | 57,296 | | | 56,561 | |
Total equity | | | | 2,603,472 | | | 2,333,928 | |
Total liabilities & equity | | | $ | 3,485,407 | | $ | 3,230,747 | |