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Sep 30, 2020

Edwards Lifesciences Q3 2020 Earnings Report

Edwards Lifesciences reported better-than-expected results, driven by strong TAVR sales and progress in TMTT clinical trials.

Key Takeaways

Edwards Lifesciences reported a 4% increase in sales to $1.1 billion for the third quarter of 2020. Diluted earnings per share were $0.52, and adjusted earnings per share grew 9% to $0.51. The company is raising the bottom end of full-year 2020 adjusted earnings per share guidance to $1.85 to $1.95.

Sales of $1.1 billion grew 4%; similar underlying growth expected in the fourth quarter

TAVR global sales grew 6%

EPS was $0.52; adjusted EPS grew 9% to $0.51

2020 adjusted EPS guidance increased to $1.85 to $1.95 from $1.75 to $1.95

Total Revenue
$1.14B
Previous year: $1.09B
+4.3%
EPS
$0.51
Previous year: $0.47
+8.5%
Gross Profit Margin
75.5%
Previous year: 75.9%
-0.5%
SG&A Expenses
$307M
R&D Expenses
$196M
Gross Profit
$860M
Previous year: $802M
+7.3%
Cash and Equivalents
$1.02B
Previous year: $1.19B
-13.7%
Free Cash Flow
$113M
Previous year: $361M
-68.7%
Total Assets
$6.8B
Previous year: $5.97B
+14.0%

Edwards Lifesciences

Edwards Lifesciences

Edwards Lifesciences Revenue by Segment

Edwards Lifesciences Revenue by Geographic Location

Forward Guidance

The company anticipates year-over-year underlying sales growth similar to the third quarter. The company is raising the bottom end of full-year 2020 adjusted earnings per share guidance to $1.85 to $1.95, versus previous guidance of $1.75 to $1.95. Looking ahead to 2021, the company anticipates a return to double-digit TAVR growth and aspires to double 2020 TMTT sales.

Positive Outlook

  • Year-over-year underlying sales growth similar to the third quarter in Q4 2020
  • Raising the bottom end of full-year 2020 adjusted earnings per share guidance to $1.85 to $1.95
  • Anticipates a return to double-digit TAVR growth in 2021
  • Aspiration to double 2020 TMTT sales
  • Optimistic about continuing to deliver innovations to patients around the world

Challenges Ahead

  • Ongoing COVID pandemic challenges
  • Negative impact from foreign currency fluctuations
  • Incremental costs associated with responding to COVID
  • Potential delay in initial pivotal clinical trial results by a couple of quarters
  • Impact of delayed elective procedures

Revenue & Expenses

Visualization of income flow from segment revenue to net income