Medtronic Reaffirms Revenue Growth Guidance, Updates Segment Outlook

By Dave Sebastian

Medtronic PLC (MDT) said it continues to expect organic revenue in fiscal 2020 to rise about 4% but nudged up organic revenue growth guidance for three segments that comprise 92% of revenue as it raised its full-year adjusted earnings outlook.

The medical-device company on Tuesday said it now sees revenue in its cardiac and vascular group increasing 2.5% to 3% for the year, up from its prior guidance of 2.5%.

It expects the metric in its minimally invasive therapies group to rise 5% to 5.5%, up from the previous outlook of 5%.

The company sees its restorative therapies group's organic revenue growing 4.5% to 5%, up from the 4% to 4.5% it previously guided.

For the diabetes group, however, the company sees low-single-digit organic growth, compared with its prior outlook of the lower end of 6% to 8%, as it faces competitive pressures in the U.S. while awaiting new product approval.

Medtronic raised its full-year adjusted earnings guidance to between $5.57 a share and $5.63 a share from $5.54 to $5.60 a share.

Shares of Medtronic are down 0.6% to $110.60.

For the third quarter, the company said it sees organic revenue growing more than 4%, with currency weighing on the metric by 0.5% to 1.2%.

It sees the organic growth in the cardiac and vascular group to accelerate 3.5% to 4%; the diabetes group to be flat to slightly down; and the minimally invasive therapies and restorative therapies groups to grow 4.5% to 5%.

For the full year, the company said it continues to expect operating margin to rise by about 0.4% on a constant-currency basis, and for it to slightly improve in the third quarter.

For the third quarter, Medtronic said it sees adjusted nominal tax rate to be in the range of 15% to 15.25% and an annual range of 15% to 15.5%.

Medtronic said it anticipates fourth-quarter growth to accelerate as it awaits U.S. or European approval for its products.

Write to Dave Sebastian at [e-mail]

(END) Dow Jones Newswires

November 19, 2019 10:17 ET (15:17 GMT)

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