Medtronic Plc. · NYSE:MDT
Medtronic — Q4 FY17 Earnings Presentation
20 slides from Medtronic's earnings presentation, May 25, 2017
Slide 1: Medtronic plc Q4 FY17 Earnings Presentation
MEDTRONIC PLC Q4 FY17 EARNINGS PRESENTATION MAY 25, 2017 • FY17 FINANCIAL HIGHLIGHTS • Q4 FY17 CONSOLIDATED RESULTS & GROUP REVENUE HIGHLIGHTS • REVENUE / EPS GUIDANCE & OTHER ASSUMPTIONS Exhibit 99.2
Slide 2: Forward Looking Statements
Q4 FY17 Earnings Results | May 25, 2017 | 2 FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements which provide current expectations or forecasts, including those relating to market and sales growth, growth strategies, changes to the healthcare system, financial results, u
Slide 3: MDT FY17 Highlights
Q4 FY17 Earnings Results | May 25, 2017 | 3 Executed steady cadence of meaningful product launches, expanded our global footprint, and extended our leadership in value-based healthcare offerings • Mid-Single Digit Organic Growth2: ~4% • Acquisitions contributed ~100 – 110 bps • Foreign currency ha
Slide 4: MDT FY17 GAAP Select Financial Information
Q4 FY17 Earnings Results | May 25, 2017 | 4 MDT FY17 GAAP SELECT FINANCIAL INFORMATION FY17 FY16 Y/Y Growth / Y/Y Change Net Sales ($M) 29,710 28,833 3% Cost of Products Sold 9,291 9,142 2% Gross Margin 68.7% 68.3% 40 bps SG&A ($M) 9,711 9,469 3% % of Sales 32.7% 32.8% 10 bps R&D ($M) 2,193 2,224 (1
Slide 5: MDT FY17 Y/Y EPS Walk
Q4 FY17 Earnings Results | May 25, 2017 | 5 MDT FY17 Y/Y EPS WALK 0.00 1.00 2.00 3.00 4.00 5.00 6.00 FY16, GAAP Non-GAAP Adjustments FY16, Non-GAAP Extra Week Impact FY16, Non-GAAP Adj. Performance FY17 CC FX FY17, Non-GAAP Non-GAAP Adjustments FY17, GAAP EPS Growth1: Double Digits; EPS Leverage1: ~
Slide 6: MDT FY17 Y/Y Operating Margin Changes
Q4 FY17 Earnings Results | May 25, 2017 | 6 MDT FY17 Y/Y OPERATING MARGIN CHANGES 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% FY16, GAAP Non-GAAP Adjustments FY16, Non-GAAP Extra Week Impact FY16, Non-GAAP Adj. Performance FY17 CC FX FY17, Non-GAAP Non-GAAP Adjustments FY17, GAAP ~100 bps Operatio
Slide 7: MDT FY17 Non-GAAP Select Financial Information
Q4 FY17 Earnings Results | May 25, 2017 | 7 MDT FY17 NON-GAAP SELECT FINANCIAL INFORMATION FY16 FY16 Estimated Extra week Impact FY16 Adj for extra week FY17 FX Impact $M / Change FY17 Constant Currency1 FY17 CC Adj2 Growth /Change Net Sales ($M) 28,833 ~($450) -- 29,710 (34) -- ~5% Gross Margin1 69
Slide 8: Consolidated Results & Group Revenue Highlights
Q4 FY17 CONSOLIDATED RESULTS & GROUP REVENUE HIGHLIGHTS
Slide 9: MDT Q4 FY17 Highlights
Q4 FY17 Earnings Results | May 25, 2017 | 9 Balanced, diversified growth across groups and geographies • CVG, MITG, RTG and Diabetes all MSD growth1 • US MSD growth1; Non-US Developed MSD growth1; Emerging Markets DD growth1 • Korea and Japan: HSD growth1 • Strong DD growth1 in China, Latin Americ
Slide 10: MDT Q4 FY17 GAAP Select Financial Information
Q4 FY17 Earnings Results | May 25, 2017 | 10 MDT Q4 FY17 GAAP SELECT FINANCIAL INFORMATION Q4 FY17 Q4 FY16 Y/Y Growth / Y/Y Change Net Sales ($M) 7,916 7,567 5% Cost of Products Sold 2,436 2,363 3% Gross Margin 69.2% 68.8% 40 bps SG&A ($M) 2,479 2,360 5% % of Sales 31.3% 31.2% 10 bps R&D ($M) 553 57
Slide 11: MDT Q4 FY17 Y/Y EPS Walk
Q4 FY17 Earnings Results | May 25, 2017 | 11 MDT Q4 FY17 Y/Y EPS WALK 0.00 0.20 0.40 0.60 0.80 1.00 1.20 1.40 1.60 Q4 FY16, GAAP Q4 FY16, Non-GAAP Adjustments Q4 FY16, Non-GAAP Performance Q4 FY17 CC FX Q4 FY17, Non-GAAP Q4 FY17, Non-GAAP Adjustments Q4 FY17, GAAP EPS Growth1: Mid-Single Digit; EPS
Slide 12: MDT Q4 FY17 Y/Y Operating Margin Changes
Q4 FY17 Earnings Results | May 25, 2017 | 12 MDT Q4 FY17 Y/Y OPERATING MARGIN CHANGES 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% Q4 FY16, GAAP Q4 FY16, Non-GAAP Adjustments Q4 FY16, Non-GAAP Performance Q4 FY17 CC FX Q4 FY17, Non-GAAP Q4 FY17, Non-GAAP Adjustments Q4 FY17, GAAP ~40 bps Operationa
Slide 13: MDT Q4 FY17 Non-GAAP Select Financial Information
Q4 FY17 Earnings Results | May 25, 2017 | 13 MDT Q4 FY17 NON-GAAP SELECT FINANCIAL INFORMATION Q4 FY17 Q4 FY16 FX Impact $M / Change Q4 FY17 Constant Currency1 Q4 FY17 CC Growth / Change2 Net Sales ($M) 7,916 7,567 (37) -- 5% Cost of Products Sold1 2,426 2,363 (22) -- 4% Gross Margin1 69.4% 68.8% 20
Slide 14: CVG Q4 FY17 Highlights
Q4 FY17 Earnings Results | May 25, 2017 | 14 CVG Q4 FY17 HIGHLIGHTS CRHF 54% CSH 30% APV 16% U.S. 52% Non- U.S. Dev 33% EM 15% Cardiac Rhythm & Heart Failure (CRHF) KEY PERFORMANCE DRIVERS1 Heart Failure: +MSD • Driven by HeartWare acquisition • CRT-D: highest CRT-D share in 7 years in the US init
Slide 15: MITG Q4 FY17 Highlights
Q4 FY17 Earnings Results | May 25, 2017 | 15 MITG Q4 FY17 HIGHLIGHTS Surgical Solutions KEY PERFORMANCE DRIVERS1 HSD Growth in Surgical Solutions and MSD Growth in PMR Patient Monitoring & Recovery (PMR) Early Technologies: +MSD • Growth in GI Therapeutics driven by products including PillCam™ SB
Slide 16: RTG Q4 FY17 Highlights
Q4 FY17 Earnings Results | May 25, 2017 | 16 RTG Q4 FY17 HIGHLIGHTS Spine 35% Brain 30% Specialty 20% Pain 15% [CATE GORY NAME] [VALU E] [CATEG ORY NAME] [VALUE] [CATEG ORY NAME] [VALUE ] KEY PERFORMANCE DRIVERS1 Sustained Improvement in Spine; Solid Brain & Specialty Therapies Growth Offsets Declin
Slide 17: Diabetes Q4 FY17 Highlights
Q4 FY17 Earnings Results | May 25, 2017 | 17 DIABETES Q4 FY17 HIGHLIGHTS US 59% Non-US Dev 33% EM 8% KEY PERFORMANCE DRIVERS1 Intensive Insulin Management (IIM) Continued Growth In Pumps & CGM; Robust Pipeline Throughout FY18 MiniMed® 630G Guardian® Connect 17 Total Group Revenue $512M Revenue $M As
Slide 18: FY18 EPS Guidance, Revenue Outlook, & Other Assumptions
FY18 EPS GUIDANCE, REVENUE OUTLOOK, & OTHER ASSUMPTIONS
Slide 19: MDT FY18 Revenue / EPS Guidance & Other Assumptions
Q4 FY17 Earnings Results | May 25, 2017 | 19 MDT FY18 REVENUE / EPS GUIDANCE & OTHER ASSUMPTIONS FY18 Revenue Growth – CC 4 - 5% CVG Growth – CC 5 - 6% MITG Growth – CC 3 - 4% RTG Growth – CC ~4% Diabetes Growth – CC 10-12% (Ramp H1 to H2) COV Synergies ~$250 - $275M EPS Growth1 – CC 9 - 10% Other t
Slide 20: Appendix: Acronyms / Abbreviations
Q4 FY17 Earnings Results | May 25, 2017 | 20 APPENDIX ACRONYMS / ABBREVIATIONS 1 Other Adj Adjusted FCF Free Cash Flow APAC Asia Pacific FDA Food and Drug Administration ASEAN Association of Southeast Asian Nations FX Foreign Exchange ASP Average Selling Price FY Fiscal Year Bps Basis Points GAAP Ge