SEC Filings

10-Q
MEDTRONIC PLC filed this Form 10-Q on 12/04/2017
Entire Document
 
Medtronic plc
Notes to Consolidated Financial Statements
(Unaudited)


18. Segment and Geographic Information
Segment Information
The Company’s management evaluates segment performance and allocates resources based on net sales and earnings before interest expense, net, income tax (benefit) provision, and amortization of intangible assets, not including centralized distribution costs and corporate charges, as presented in the table below. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies in Note 1 to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended April 28, 2017. The financial information that is regularly reviewed by the Company's chief operating decision maker to assess performance and allocate resources changed during fiscal year 2017. As a result, the Company has revised the disclosure for the prior period to align with current presentation.
Net sales of the Company’s reportable segments include end-customer revenues from the sale of products each reportable segment develops and manufactures or distributes. Segment disclosures are on a performance basis consistent with internal management reporting. Certain items are at corporate and centralized and are not allocated to the segments. Net sales and earnings before interest expense, net, income tax (benefit) provision, and amortization of intangible assets, not including centralized distribution costs and corporate charges by reportable segments are as follows:
 
Three months ended
 
Six months ended
(in millions)
October 27, 2017
 
October 28, 2016
 
October 27, 2017
 
October 28, 2016
Cardiac and Vascular Group
$
2,773

 
$
2,584

 
$
5,419

 
$
5,102

Minimally Invasive Therapies Group
1,952

 
2,473

 
4,438

 
4,897

Restorative Therapies Group
1,863

 
1,826

 
3,672

 
3,598

Diabetes Group
462

 
462

 
911

 
914

Net Sales
$
7,050

 
$
7,345

 
$
14,440

 
$
14,511

 
Three months ended
 
Six months ended
(in millions)
October 27, 2017
 
October 28, 2016
 
October 27, 2017
 
October 28, 2016
Cardiac and Vascular Group
$
1,104

 
$
1,017

 
$
2,115

 
$
1,971

Minimally Invasive Therapies Group
761

 
886

 
1,636

 
1,710

Restorative Therapies Group
750

 
700

 
1,430

 
1,370

Diabetes Group
91

 
158

 
202

 
317

Reportable segments' EBITA before other adjustments
2,706

 
2,761

 
5,383

 
5,368

Amortization of intangible assets
(460
)
 
(500
)
 
(914
)
 
(987
)
Restructuring charges, net
(18
)
 
(47
)
 
(32
)
 
(151
)
Acquisition-related items
(18
)
 
(28
)
 
(71
)
 
(80
)
Certain litigation charges

 

 

 
(82
)
Divestiture-related items
(67
)
 

 
(115
)
 

Gain on sale of businesses
697

 

 
697

 

Special charge
(80
)
 

 
(80
)
 

Hurricane Maria
(34
)
 

 
(34
)
 

Impact of inventory step-up

 
(38
)
 

 
(38
)
Centralized distribution costs
(486
)
 
(446
)
 
(928
)
 
(847
)
Interest expense, net
(173
)
 
(173
)
 
(367
)
 
(352
)
Corporate
(339
)
 
(317
)
 
(616
)
 
(631
)
Income before income taxes
$
1,728

 
$
1,212

 
$
2,923

 
$
2,200


34

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