8-KEarnings & ResultsExhibits & Filings

STRYKER CORP 8-K Report, Financial Results (Oct 17, 2006)

Filed October 17, 2006For Securities:SYK

Summary

Stryker Corporation (SYK) filed an 8-K report on October 17, 2006, to announce its third-quarter 2006 operating results, detailed in an accompanying press release (Exhibit 99.1). The key aspect of this filing is the company's presentation of adjusted net earnings. This non-GAAP measure excludes specific one-time charges to provide a clearer view of the company's ongoing operational performance and facilitate period-to-period comparisons. Investors should note that the adjusted figures exclude a purchased in-process research and development (R&D) charge impacting the nine-month period ended September 30, 2006. Additionally, it excludes the income tax expense related to the repatriation of foreign earnings under the American Jobs Creation Act, which affected the three and nine-month periods ended September 30, 2005. While Stryker emphasizes that these adjusted measures are supplemental and do not replace GAAP results, management uses them for operational review and trend analysis, and believes they offer investors valuable insights into performance.

Key Highlights

  • 1Stryker Corporation announced its third-quarter 2006 financial results via a press release filed with the SEC.
  • 2The company is reporting adjusted net earnings, a non-GAAP financial measure, in addition to its GAAP results.
  • 3Adjusted net earnings exclude a purchased in-process R&D charge for the nine months ended September 30, 2006.
  • 4Also excluded from adjusted net earnings is the income tax expense related to foreign earnings repatriation under the American Jobs Creation Act for the periods ending September 30, 2005.
  • 5Stryker states that these adjusted figures provide a more consistent and comparable view of ongoing operational performance.
  • 6Management utilizes these non-GAAP measures for internal review and strategic planning.
  • 7The company encourages investors to review both GAAP and non-GAAP measures, along with other financial filings.

Frequently Asked Questions

The primary purpose of this 8-K filing is to announce Stryker Corporation's third-quarter 2006 operating results and to provide the accompanying press release as an exhibit. It also highlights the company's use of adjusted net earnings as a supplemental financial measure.

Stryker's adjusted net earnings exclude two main items: a purchased in-process research and development (R&D) charge for the nine months ended September 30, 2006, and the income tax expense related to the repatriation of foreign earnings under the American Jobs Creation Act for the three and nine months ended September 30, 2005.

Stryker provides adjusted net earnings because management believes it offers a more meaningful view of the company's results on a consistent and comparable basis, free from the impact of specific one-time charges. This helps in evaluating period-to-period performance and potential future trends.

No, Stryker explicitly encourages investors and users of their financial statements to review their consolidated financial statements and other publicly filed reports in their entirety and not to rely solely on any single financial measure. The adjusted figures are supplemental and do not replace GAAP results.