SEC Filings

DEFR14A
MEDTRONIC PLC filed this Form DEFR14A on 10/11/2017
Entire Document
 
(in millions, except per share data) Fiscal year ended April 29, 2016
Net Sales Cost of
Products
Sold
  Gross
Margin
Percent
  Operating
Profit
Operating
Profit
Percent
  Income
Before
Provision
for Income
Taxes

Net Income

attributable

to Medtronic

Diluted
EPS(1)

Effective

Tax Rate

 
GAAP $ 28,833 $ 9,142   68.3 % $ 5,291 18.4 % $ 4,336 $ 3,538 $ 2.48 18.4 %
Non-GAAP Adjustments:(2)                                      
Impact of inventory step-up(e)     (226 )       226       226   165   0.12 27.0  
Special charge(f)             70       70   44   0.03 37.1  
Restructuring charges, net     (9 )       299       299   221   0.15 26.1  
Certain litigation charges             26       26   17   0.01 34.6  
Acquisition-related items             283       283   212   0.15 25.1  
Amortization of intangible assets             1,931       1,931   1,467   1.03 24.0  

Loss on previously held forward starting interest rate swaps

                  45   29   0.02 35.6  
Debt tender premium                   183   118   0.08 35.5  
Certain tax adjustments, net(g)                     417   0.29  
Non-GAAP $ 28,833 $ 8,907   69.1 % $ 8,126 28.2 % $ 7,399 $ 6,228 $ 4.37 15.8 %

 

Year over year percent change:                   Net
Income
 

Diluted

EPS

 

Operating

Margin

 
GAAP                         14 % 17 % (0.5 )%
Non-GAAP                         3 % 5 % (0.1 )%
Constant Currency Adjusted Non-GAAP(3)                             9 % 0.8 %
(1)The data in this schedule has been intentionally rounded to the nearest $0.01 and, therefore, may not sum.
(2)Non-GAAP adjustments relate to charges or benefits that management believes may or may not recur with similar materiality or impact on results in future periods.
(a)Represents amortization of step-up in fair value of inventory acquired in connection with the HeartWare acquisition.
(b)The charge represents a contribution to the Medtronic Foundation.
(c)Integration-related costs incurred in connection with the Covidien acquisition, and charges incurred in connection with the pending divestiture of a portion of our Patient Monitoring & Recovery division to Cardinal Health.
(d)The net charge primarily relates to the tax effect from the recognition of the outside basis difference of certain subsidiaries which are included in the expected divestiture of a portion of our Patient Monitoring & Recovery division to Cardinal Health, certain tax charges recorded in connection with the redemption of an intercompany minority interest, and the resolution of various tax matters from prior periods.
(e)Represents amortization of step-up in fair value of inventory acquired in connection with the Covidien acquisition.
(f)The impairment of a debt investment.
(g)Primarily relates to U.S. income tax expense resulting from the Company’s completion of an internal reorganization of the ownership of certain legacy Covidien businesses that reduced the cash and investments held by Medtronic’s U.S.- controlled non-U.S. subsidiaries. Also includes a benefit related to the establishment of a deferred tax asset on the tax basis in excess of book basis of a wholly owned U.S. subsidiary of which the Company disposed.
(3)Due to its 52/53 week fiscal year calendar, the Company had an additional selling week in the first quarter of fiscal year 2016. While it is difficult to calculate an exact impact from the extra week, the Company estimates an $0.08 to $0.10 benefit to non-GAAP diluted earnings per share (EPS) in the first quarter of fiscal year 2016. The Company estimates that, adjusting for the extra week, non-GAAP earnings, diluted EPS, and operating margin increases were approximately 8 to 9 percent, approximately 11 to 12 percent, and approximately 1 percent, respectively, on a constant currency, constant week basis when compared to the prior fiscal year.

 

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