KALAMAZOO, Mich., April 17 /PRNewswire-FirstCall/ -- Stryker Corporation reported operating results for the quarter ended March 31, 2008 as follows:
“We are pleased to report another strong quarter with double-digit sales growth and twenty percent growth in earnings from continuing operations,” commented Stephen P. MacMillan, President and Chief Executive Officer. “The ability to draw on a broad base of businesses continues to be important to our success, with six of our U.S. franchises -- Spine, Trauma, Craniomaxillofacial, Instruments, Endoscopy and Medical -- leading the way with 18% collective growth this quarter.”
Net sales were $1,634.4 million for the first quarter of 2008, representing a 14.7% increase over net sales of $1,425.5 million for the first quarter of 2007. On a constant currency basis, net sales increased 10.3% for the first quarter.
Net earnings from continuing operations for the first quarter of 2008 were $290.5 million, representing a 20.1% increase over net earnings from continuing operations of $241.8 million for the first quarter of 2007. Diluted net earnings per share from continuing operations for the first quarter of 2008 increased 20.7% to $.70 compared to $.58 for the first quarter of 2007.
Net earnings for the first quarter of 2008 were $290.5 million, representing a 19.3% increase over net earnings of $243.5 million for the first quarter of 2007. Diluted net earnings per share for the first quarter of 2008 increased 18.6% to $.70 compared to $.59 for the first quarter of 2007.
Sales Analysis
Domestic sales were $1,032.9 million for the first quarter of 2008, representing an increase of 13.1%, as a result of higher shipments of Orthopaedic Implants and MedSurg Equipment.
International sales were $601.5 million for the first quarter of 2008, representing an increase of 17.4%, as a result of higher shipments of Orthopaedic Implants and MedSurg Equipment. The impact of foreign currency comparisons to the dollar value of international sales was favorable by $62.0 million in the first quarter of 2008. On a constant currency basis, international sales increased 5.3% in the first quarter of 2008.
Worldwide sales of Orthopaedic Implants were $971.1 million for the first quarter of 2008, representing an increase of 12.4%, based on higher shipments of reconstructive (hip, knee and shoulder), trauma, spinal and craniomaxillofacial implant systems; and bone cement. On a constant currency basis, sales of Orthopaedic Implants increased 7.3% in the first quarter of 2008.
Worldwide sales of MedSurg Equipment were $663.3 million for the first quarter of 2008, representing an increase of 18.1%, based on higher shipments of surgical equipment; endoscopic, communications and digital imaging systems; as well as patient handling and emergency medical equipment. On a constant currency basis, sales of MedSurg Equipment increased 14.9% in the first quarter of 2008.
Income Taxes
The Company’s effective income tax rate on earnings from continuing operations for the first quarter of 2008 was 28.1%, as compared to effective income tax rates on such earnings for the first quarter and year ended December 31, 2007 of 28.1% and 28.0%, respectively.
Outlook for 2008
The Company’s outlook for 2008 continues to be optimistic regarding underlying growth rates in orthopaedic procedures and sales growth rates in the Company’s broadly based range of products in orthopaedics and other medical specialties, despite the potential for continued pricing pressure in certain markets. The Company projects that diluted net earnings per share for 2008 will approximate $2.88, an increase of 20% over adjusted diluted net earnings per share from continuing operations of $2.40 in 2007. The financial forecast for 2008 includes a constant currency net sales increase in the range of 11% to 13% as a result of growth in shipments of Orthopaedic Implants and MedSurg Equipment. If foreign currency exchange rates hold near March 31, 2008 levels, the Company anticipates a favorable impact on net sales of approximately 4.5% to 5% in the second quarter of 2008 and a favorable impact on net sales of approximately 2.5% to 3.5% for the full year of 2008.
As previously announced, the Company will conduct a conference call for financial analysts at 4:30 p.m., Eastern Time, today. To participate in the conference call dial 800-510-0178 (domestic) or 617-614-3450 (international) and enter the participant passcode 99400509. A simultaneous webcast of the call will be accessible via the Company’s website at www.stryker.com. The call will be archived on this site for 90 days.
A recording of the call will also be available from 6:30 p.m., Eastern Time today until 6:30 p.m. on Thursday, April 24, 2008. To hear this recording dial 888-286-8010 (domestic) or 617-801-6888 (international) and enter the passcode 31621619.
Forward-Looking Statements
This press release contains information that includes or is based on forward-looking statements within the meaning of the federal securities law that are subject to various risks and uncertainties that could cause the Company’s actual results to differ materially from those expressed or implied in such statements. Such factors include, but are not limited to: pricing pressures generally, including cost-containment measures that could adversely affect the price of or demand for the Company’s products; regulatory actions; unanticipated issues arising in connection with clinical studies and otherwise that affect U.S. Food and Drug Administration approval of new products; changes in reimbursement levels from third-party payors; a significant increase in product liability claims; changes in economic conditions that adversely affect the level of demand for the Company’s products; changes in foreign exchange markets; changes in financial markets; and changes in the competitive environment. Additional information concerning these and other factors are contained in the Company’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
Stryker Corporation is one of the world’s leading medical technology companies with the most broadly based range of products in orthopaedics and a significant presence in other medical specialties. Stryker works with respected medical professionals to help people lead more active and more satisfying lives. The Company’s products include implants used in joint replacement, trauma, craniomaxillofacial and spinal surgeries; biologics; surgical, neurologic, ear, nose & throat and interventional pain equipment; and endoscopic, surgical navigation, communications and digital imaging systems; as well as patient handling and emergency medical equipment. For more information about Stryker, please visit the company web site at www.stryker.com.
CONTACT: Katherine A. Owen, Vice President, Strategy and Investor
Relations, of Stryker Corporation, +1-269-385-2600
Web site: http://www.stryker.com/
