Company News


This press release is posted as a service by Angioplasty.Org
Guidant Initiates Suit for Specific Performance
Company Reports Third Quarter Sales of $795 Million
Indianapolis, Ind. — November 7, 2005 — Guidant Corporation (NYSE: GDT), a world leader in the treatment of cardiac and vascular disease, announced that it is initiating a lawsuit today in the United States District Court for the Southern District of New York against Johnson & Johnson seeking specific performance of Johnson & Johnson’s obligation to complete its acquisition of Guidant in accordance with the Merger Agreement between the parties dated as of December 15, 2004. Guidant also intends to ask the court to expedite pre-trial discovery in order to resolve the matter as quickly as possible.

The company also today reported third quarter results. The company posted sales of $795 million, representing a sales decline of $130 million or 14 percent versus the prior year.

Income and earnings per share from continuing operations for the quarter were $65 million and $0.20 versus $161 million and $0.50 in the third quarter of 2004. Third quarter 2005 income from continuing operations includes in-process research and development after-tax charges of $43 million, or $0.12 per share principally related to a drug eluting stent development milestone in the company’s exclusive agreement with Novartis Pharma AG. Prior year third quarter income from continuing operations included an after-tax restructuring charge of $42 million, or $0.13 per share. Excluding these items, third quarter adjusted income and earnings per share were $108 million and $0.32 compared to $202 million and $0.63.

Please see the attached schedules and the Guidant website at www.guidant.com/investors/reconciliations/ for additional information, including reconciliations of U.S. GAAP to as adjusted income and earnings per share, net cash reconciliations and product sales summaries reclassified for discontinued operations. For more information on Guidant’s financial results, see Guidant’s third quarter Form 10-Q filed today at www.guidant.com/investors/tfn_sec.htm.

Guidant’s third quarter results reflect the temporary unavailability of our leading cardiac resynchronization-defibrillator devices during the full month of July and part of August, as well as the impact of this and other product recalls and physician advisories on implantable defibrillator and pacemaker sales. This impact was partially offset by sequential growth of U.S. coronary stent revenue, and continuing sales growth of our emerging businesses.

Third Quarter Financial Highlights
  • Worldwide implantable defibrillator sales decreased 26 percent to $331 million; U.S. implantable defibrillator sales were $246 million, a decline of 31 percent. International implantable defibrillator sales declined 3 percent to $85 million.
  • Worldwide pacemaker sales declined 15 percent to $153 million; U.S. pacemaker sales were $85 million.
  • Worldwide coronary stent sales of $112 million declined 8 percent versus the prior year; U.S. stent sales totaled $64 million, representing a sequential increase.
  • Worldwide angioplasty system sales increased 3 percent to $108 million.
  • Worldwide sales of cardiac surgery and peripheral, including carotid and biliary systems, (emerging businesses) grew 27 percent to $91 million.
  • Gross margin was 78.6 percent compared to 75.3 percent in the third quarter of 2004. The third quarter 2005 gross margin included a net benefit of approximately $17 million, or 210 basis points, primarily associated with lower than expected implantable defibrillator and pacemaker warranty claims.
  • Net cash of $2.4 billion increased $812 million year to date and $126 million from June 30, 2005.

Guidant Corporation
Guidant Corporation pioneers lifesaving technology, giving an opportunity for a better life today to millions of cardiac and vascular patients worldwide. The company develops, manufactures and markets a broad array of products and services that enable less invasive care for some of life's most threatening medical conditions. For more information, visit www.guidant.com.

Guidant provides earnings per share on an adjusted basis from continuing operations because Guidant's management believes that the presentation provides useful information to investors. Among other things, it may assist investors in evaluating the company's operations period over period. In various periods, this measure may exclude such items as business development activities (including IPRD at acquisition or upon attainment of milestones and any extraordinary expenses), strategic developments (including restructuring and product line changes), significant litigation, and changes in applicable laws and regulations (including significant accounting or tax matters). Special items may be highly variable, difficult to predict, and of a size that sometimes has substantial impact on the company's reported operations for a period. Management uses this measure internally for planning, forecasting and evaluating the performance of the business, including allocating resources and evaluating results relative to employee performance compensation targets. Investors should consider non-GAAP measures in addition to, not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP.

SOURCE

Angioplasty.Org Home •  PatientCenter

this press release is posted as a reader service by Angioplasty.org,
 an editorially independent informational health site
which has received unrestricted educational grants from
Medtronic plc, TCROSS NEWS, Toshiba America Medical Systems, Volcano Corporation, Terumo Medical Corporation
Cardium Therapeutics, Inc. and Lenox Hill Heart and Vascular Institute of NY
All content, including text, photos and video
©Copyright Venture Digital LLC 1996-2021