Covidien fiscal 3Q profit falls 15 percent

Covidien PLC's fiscal third-quarter earnings fell 15 percent, as some expenses jumped and foreign exchange rates dampened revenue growth for the Irish drug and medical device maker.

The Dublin company operates in 140 countries but reports results in dollars, which means exchange rates can affect revenue comparisons with previous quarters. Covidien's revenue rose 3 percent to about $3.01 billion in the recent quarter. Not counting the impact of foreign exchange, revenue was up 6 percent.

Covidien also said its selling, general and administrative expenses were up 6 percent, to $936 million due mainly to the company's push to expand sales in emerging markets. A company spokesman said China and India got most of that investment. Drug and medical device makers see developing markets as key sources of future growth, and many are expanding their presence in those countries.

Research and development costs climbed 15 percent to $159 million, and Covidien's income tax expense jumped to $124 million from $26 million.

Overall, the company earned $453 million, or 93 cents per share, in the quarter that ended June 29. That compares to earnings of $535 million, or $1.07 per share, in last year's quarter. Adjusted earnings, which exclude one-time items, were $1.07 per share.

Analysts surveyed by FactSet expected earnings of $1.06 per share on $3.01 billion in revenue.

Sales from the company's biggest segment, medical devices, climbed 4 percent to $2.06 billion in the quarter, helped in part by new products. Sales from both the pharmaceutical and medical supplies segments grew slightly to $501 million and $443 million, respectively.

Source: http://news.yahoo.com/covidien-fiscal-3q-profit-falls-15-percent-115356154--finance.html

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