St. Jude Medical (NYSE:STJ) CEO Daniel Starks told analysts last week that they shouldn’t expect the company to follow competitors like Medtronic (NYSE:MDT) down the consolidation path.
Starks said the markets St. Jude serves, along with recent acquisitions it’s made in smaller tuck-in deals gives it all the dry powder it needs to keep growing.
"For us it’s not a matter of just being a larger company. It’s a matter of how big are the problems we are addressing and how much impact can our technology have on the financial success of our customers," Starks told analysts during a conference call discussing the company’s 4th-quarter results. "And so we think about heart failure and how much of a priority the economics and patient outcomes of heart failure are, same for atrial fibrillation, same for chronic pain, and we are uniquely positioned to have a major impact on the success of customer programs for all 3 of these disease states. And we think that this makes us big enough to be relevant, big enough to have a seat at the table and sets us up for a superior level of sustainable sales growth on a long-term basis."
One of the acquisitions St. Jude Medical is counting on is its CardioMEMS HF system, for which it paid $455 million last year. Sales of the heart failure system were approximately $12 million during the most recent quarter, the company said.
St. Jude posted profits of $245 million, or 84¢ per share, on sales of $1.44 billion for the 3 months ended Jan. 3, for profit growth of 99.2% on sales growth of 1.2% compared with Q4 2013. Adjusted earnings per share were $1.03, dead even with analysts’ expectations on Wall Street.
Full-year profits were $1.0 billion, or $3.46 per share, on sales of $5.62 billion, representing a bottom-line gain of 38.6% and sales growth of 2.2% compared with 2013. Adjusted EPS came in at $3.98 last year, missing The Street’s forecast by a penny.
Last week, St. Jude’s crosstown rival Medtronic (NYSE:MDT) closed its $50 billion deal to acquire Covidien (NYSE:COV), in the largest medical device merger of all time.
