Sales for the three months ended July 31 (which had one more week than the first quarter of fiscal 2009) rose 6.1 percent to $3.93 billion, compared with $3.71 billion during the same period last year.
Net earnings slumped to $445 million, compared with $723 million during Q1 2009.
The legal bills sent total costs as a percentage of revenues up 10.4 percent. Medtronic paid $400 million directly to its Chicago-based rival and another $44 million to evYsio Medical Devices LLC, which owns a stent design technology sublicensed by Abbott.
The settlement also calls for both sides to refrain from suing each other for at least 10 years.
Medtronic said overseas sales grew 6 percent to $1.54 billion, making up nearly 40 percent of its total top line.
Its cardiac rhythm management business posted sales of $1.34 billion, up nearly 3 percent, with implantable defibrillators accounting for $775 million and pacemaker sales coming to $536 million. Medtronic said the division saw “significant” sales growth in Europe and China.
Spinal segment revenue was up 7 percent to $915 million, including a 24 percent boost to foreign sales.
Medtronic’s cardiovascular unit posted revenues of $689 million, a 9 percent increase, driven by strong performances from its endovascular and structural heart disease product lines, which grew 41 percent and 16 percent, respectively. The coronary sub-unit posted $353 million in sales, boosted by the Japanes début of the Endeavor drug‐eluting stent.
Neuromodulation revenue grew 7 percent to $373 million; diabetes revenue of $295 million grew 10 percent; and surgical technologies revenues reached $227 million, up 12 percent.
And the Physio‐Control business, which helped drag down distribution partner Oridion’s first-half results yesterday, posted $97 million in revenue, up 3 percent.
Despite the bottom-line slump, Leerink Swann analyst Rick Wise lists Medtronic stock as “market perform,” writing in a note to investors that the first-quarter results were in line with his expectations (and beat the consensus view by a penny).
Medtronic CFO Gary Ellis told analysts on a conference call that the company confirms its previous full-year guidance for fiscal 2010, tageting earnings of $3.10 to $3.20 per share and full-year sales growth of 5 percent to 8 percent.