St. Jude’s Third-Quarter Sales Rise 6 Percent

St. Jude Medical Inc.’s latest earnings quarter wasn’t exactly a revenue bonanza. But it wasn’t a total loss, either.

The St. Paul, Minn.-based company reported a 6 percent net sales hike (on a constant currency basis) compared with Q3 2014 but a 9.7 percent decrease in earnings due to rising income taxes and declining sales of implantable cardioverter defibrillators, pacemakers and some cardiovascular products.

St. Jude reported $215 million in earnings for the three months ended Oct. 3, down 9.7 percent from last year’s third quarter. Sales were down 2 percent to $1.3 billion, though they rose 6 percent on a constant currency basis.

Income taxes cost the company $46 million, at a 17.6 percent effective tax rate, which is more than 2.5 times the amount the company paid during last year’s third quarter.

“Third quarter results confirm that our innovation based growth program continues to gain traction. Now we are focused on efficiently integrating our acquisition of Thoratec and strengthening our entire portfolio of growth drivers for 2016,” St. Jude Medical Chairman, President and CEO Daniel J. Starks said.

Total CRM sales, which include implantable cardioverter defibrillator (ICD) and pacemaker products, fell 8 percent to $630 million. However, after adjusting for the impact of foreign currency, CRM sales dropped only 1 percent compared to the prior year quarter.

Of that total, ICD product sales totaled $392 million, a 7 percent decline on a reported basis and a 1 percent slide on a constant currency basis. Pacemaker sales plunged 10 percent to $238 million (a 1 percent decrease on a constant currency basis). AF product sales, on the other hand, jumped 7 percent to $271 million.

Total cardiovascular sales, which primarily include structural heart and vascular products, fell 2 percent to $317 million, with structural heart device revenue growing 1 percent to $141 million and vascular product proceeds mushrooming 14 percent to $176 million.

Neuromodulation products sales swelled 13 percent to $121 million, a 19 percent increase on a constant currency basis.

For the fourth quarter, St. Jude bigwigs expect constant currency revenue growth to range between 7 percent and 8 percent, with organic constant currency sales growth flat to slightly less than last year’s final quarter. Foreign exchange rates likely will impact Q4 revenue by $75 million to $85 million.

Consolidated adjusted net earnings for the fourth quarter are expected to range between $1 and $1.02 per share; full-year 2015 consolidated adjusted net earnings are forecast to fall between $3.93 and $3.95.