Edwards Profit Rises on Strong Demand for Heart ValvesMichelle Fay Cortez and Sasha Damouni
Edwards Lifesciences Corp., a maker of heart valves, said second-quarter profit increased 39 percent on greater demand for devices that replace a damaged aortic valve without cracking open the chest.
Net income rose to $94.1 million, or 82 cents a share, from $67.8 million, or 57 cents, a year earlier, the Irvine, California-based company said today in a statement. Earnings excluding one-time items of 82 cents a share beat the 76 cents average of 22 analysts’ estimates compiled by Bloomberg. Revenue increased 7.3 percent to $517.2 million, topping the consensus estimate of $514.4 million.
Quarterly sales of transcatheter heart valves increased 25 percent to $182 million, including $90 million in the U.S. from the Sapien aortic valve approved last October. Edwards had cut its estimates for U.S. sales of Sapien three times in the past six quarters.
“During the quarter, we were pleased to receive regulatory approval for the Edwards Sapien XT in Japan, which makes us the first commercially available transcatheter valve in that country,” Michael Mussallem, the company’s chief executive officer, said in a statement. “We believe transcatheter technology will be particularly attractive to Japanese patients, and its introduction there should represent meaningful sales growth beginning next year.”
The company affirmed its 2013 forecast excluding one-time items from April of $3 to $3.10 a share. Edwards had projected full-year profit of as much as $3.31 in February.
“While the U.S. launch of Sapien has been disappointing relative to management’s initial expectations, we think street expectations for Sapien in the U.S. have come down to a more reasonable level,” said Lawrence Biegelsen, an analyst at Well Fargo, in a note to investors before the earnings announcement. “We think it’s worth noting that although 2013 has been a tough, to put it mildly, year for Edwards shares, the stock is still one of the best performing medtech names over the past 5 and 10 years.”