Summary
Medtronic plc (MDT) issued this Form 8-K on July 18, 2017, to clarify information regarding its financial expectations for the first quarter and full fiscal year 2018, particularly in light of a June 2017 IT systems disruption. The company reiterated its prior guidance for revenue growth of 4-5% on a constant currency basis for both the quarter and the full year. However, due to the IT disruption and strong demand exceeding temporarily limited sensor supply in the Diabetes Group, Medtronic anticipates revenue growth for the first quarter to be at the lower end of this range. Adjusted diluted EPS growth for the first quarter is expected to be at the upper end of the high-single digit range on a constant currency basis, supported by business strength and anticipated tax benefits.
Key Highlights
- 1Medtronic reiterates FY18 revenue growth guidance of 4-5% on a constant currency basis.
- 2FY18 adjusted diluted EPS growth guidance remains 9-10% on a constant currency basis.
- 3First quarter FY18 revenue growth expected at the lower end of the 4-5% range due to IT disruption and diabetes sensor supply constraints.
- 4First quarter FY18 adjusted diluted EPS growth expected at the upper end of the high-single digit range, aided by tax benefits.
- 5Company confirms no material impact anticipated from the June IT systems disruption.
- 6Guidance does not include the impact of the pending divestiture of a portion of the Patient Monitoring and Recovery division to Cardinal Health.
- 7Updated guidance is expected after the closing of the Cardinal Health transaction, anticipated in Q2 FY18.