|MEDTRONIC PLC filed this Form 10-Q on 09/01/2017|
(Non-GAAP Nominal Tax Rate). The Non-GAAP Nominal Tax Rate is calculated as the provision for income taxes, adjusted for the impact of Non-GAAP Adjustments, as a percentage of income before provision for income taxes, excluding Non-GAAP Adjustments.
Free cash flow is a non-GAAP financial measure calculated by subtracting property, plant, and equipment additions from operating cash flows.
Refer to the “GAAP to Non-GAAP Reconciliation," "Income Taxes," and "Summary of Cash Flows" sections for reconciliations of our results of operations prepared in accordance with U.S. GAAP to the adjusted non-GAAP measurements considered by management.
EXECUTIVE LEVEL OVERVIEW
Medtronic is among the world's largest medical technology, services, and solutions companies - alleviating pain, restoring health, and extending life for millions of people around the world. We employ more than 84,000 full-time employees worldwide, serving physicians, hospitals, and patients in approximately 160 countries. Our primary products include those for cardiac rhythm disorders, cardiovascular disease, advanced and general surgical care, respiratory and monitoring solutions, neurological disorders, spinal conditions and musculoskeletal trauma, urological and digestive disorders, and ear, nose, and throat and diabetes conditions.
Net income attributable to Medtronic for the three months ended July 28, 2017 was $1.0 billion, or $0.74 per diluted share, as compared to net income attributable to Medtronic for the three months ended July 29, 2016 of $929 million, or $0.66 per diluted share, representing increases of 9 percent and 12 percent, respectively.
The table below illustrates net sales by operating segment for the three months ended July 28, 2017 and July 29, 2016:
Currency had an unfavorable impact of $33 million on net sales for the three months ended July 28, 2017, as compared to the three months ended July 29, 2016 when using the average exchange rates in effect during the prior fiscal year period. For the three months ended July 28, 2017, the acquisitions of HeartWare and Smith & Nephew's gynecology business contributed $92 million to our total net sales growth.
Our performance continues to be fueled by our three growth strategies: therapy innovation, globalization, and economic value. We are creating competitive advantages and capitalizing on the long-term trends in healthcare: namely, the desire to improve clinical outcomes; the growing demand for expanded access to care; and the optimization of cost and efficiency within healthcare systems. In our therapy innovation growth strategy, we continue to see strong adoption of our products across all our operating segments. In globalization, net sales in emerging markets and non-U.S. developed markets grew 11 percent and 4 percent, respectively, during the three months ended July 28, 2017 as compared to the corresponding period in the prior fiscal year as we continue to expand access to our products and services around the world. In our third growth strategy, economic value, we continue to execute our value-based healthcare signature programs and aggressively develop unique, value-based healthcare solutions across each of our operating segments. We remain focused on leading the shift to healthcare payment systems that reward value and improved patient outcomes over volume. See our discussion in the “Net Sales” section of this Management's Discussion and Analysis for more information on the results of our operating segments.