Edwards Lifesciences (EW) Predicts Growth in 2013

December 4, 2012 9:37 AM EST
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Edwards Lifesciences Corporation (NYSE: EW), the global leader in the science of heart valves and hemodynamic monitoring, today will provide investors with information on the initiatives expected to result in strong double-digit sales and earnings growth in 2013. During its annual investor conference at its headquarters in Irvine, Calif., Edwards' management will also discuss the company's strategy for long-term growth, technology pipeline, ongoing U.S. transcatheter heart valve launch and financial goals for 2013.

"We expect 2013 will be another very rewarding year for Edwards Lifesciences as we deliver new life saving technologies to patients around the world," said Michael A. Mussallem, chairman and CEO. "We are investing aggressively to drive breakthrough innovations in heart valve treatment and to build on our legacy as a trusted partner in the care of critically ill patients.

"We project strong underlying(1) sales growth fueled by the ongoing launch of our SAPIEN transcatheter heart valve in the U.S. Global sales of our market-expanding transcatheter valves are expected to grow to between $710 million and $790 million in 2013."

During the conference, Edwards' management will present the company's financial goals for 2013, which include total underlying sales growth of 13 to 16 percent, a gross profit margin of 74 to 76 percent, diluted earnings per share growth of more than 25 percent and free cash flow(2) of $300 million to $340 million, with all goals excluding special items. "Our strong bottom line growth projection includes the estimated impact of the medical device excise tax, as well as investments to prepare for the launch of our SAPIEN XT transcatheter heart valve in Japan. We also expect to continue our investment in research and development at approximately 15 percent of sales in 2013, which positions us well to serve many more patients with our innovative technologies and generate significant growth for years to come," said Mussallem.

Among the specific topics to be discussed at today's event are:

Transcatheter Heart Valves - Aided by the recent U.S. FDA approval of SAPIEN for the treatment of high-risk patients and also for transapical delivery, transcatheter valve sales in the U.S. are projected to be $390 million to $440 million in 2013, which will contribute to an estimated global underlying growth rate of 30 to 45 percent. U.S. clinical and regulatory progress on the Edwards SAPIEN XT transcatheter valve remains on track. Regulatory and reimbursement approvals in Japan for SAPIEN XT are expected by the end of 2013. Edwards is continuing to make progress with its two newest transcatheter valve platforms, Edwards SAPIEN 3 and Edwards CENTERA, which are designed to extend its leadership position in this rapidly growing field. By the end of 2013, the company expects to receive a CE Mark for the SAPIEN 3 valve, a lower profile balloon expandable valve designed to further reduce paravalvular leak.

Surgical Heart Valve Therapy - Edwards is making substantial investments in new surgical valve technologies designed to extend its leadership and improve patient recovery and outcomes. In 2013, the company expects to initiate the European commercial launch of its innovative EDWARDS INTUITY valve system. Edwards is also planning to introduce a selection of unique tools designed to facilitate minimally invasive valve procedures. In early 2013, Edwards expects to initiate enrollment in the U.S. clinical study of GLX, its next-generation tissue technology, on a surgical heart valve. Edwards will also unveil its new Zeta next-generation surgical valve platform, designed to be a long-term solution for younger patients. Edwards expects to generate Surgical Heart Valve Therapy sales of $800 million to $840 million in 2013, representing a 4 to 6 percent underlying growth rate.

Critical Care - Building upon its global leadership in hemodynamic monitoring systems, Edwards expects growth across this product line driven primarily by the company's advanced monitoring technologies. At the conference, Edwards will be highlighting two important new technologies expected to improve the care of critically ill patients beginning in 2013. These technologies include the recent addition of a non-invasive monitoring platform and the GlucoClear hospital glucose monitoring system. Critical Care sales are projected to be $560 million to $600 million for 2013, representing 4 to 6 percent underlying growth.

Financial Outlook - Edwards will reaffirm its 2012 sales and earnings guidance, which includes diluted earnings per share of $2.54 to $2.58, excluding special items. The company will also detail its expectations for 2013, including total sales of $2.1 billion to $2.2 billion. Excluding special items, Edwards expects 2013 diluted earnings per share of $3.21 to $3.31, an increase of more than 25 percent over projected 2012 earnings.

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