Edwards Lifesciences (NYSE:EW) posted fourth-quarter results that fell short of the consensus forecast on Wall Street, but reaffirmed its outlook for 2022.
The Irvine, California-based heart device company yesterday evening reported profits of $335.3 million — or $0.53 per diluted share — on sales of $1.33 billion for the three months ended Dec. 31, 2021, for a bottom-line gain of 8% and sales growth of 12% compared with Q4 2020.
Transcatheter aortic valve replacement (TAVR) sales grew to $872 million for the quarter, up 12% despite the “pronounced impact on hospital resources” in December from the omicron variant of COVID-19, said CEO Mike Mussallem. He cited the delta variant wave in the company’s third-quarter results.
TAVR sales outside the U.S. grew about 20% on an underlying basis in Q4, and Edwards Lifesciences said it continues to project that the global TAVR opportunity will double to $10 billion by 2028.
Research and development expenses grew 19% to $233 million for the quarter, primarily on transcatheter innovations such as increased transcatheter mitral and tricuspid therapies (TMTT) clinical trial activity. Edwards Lifesciences is one of the medtech industry’s top spenders on R&D, both by total dollar amount and as a share of revenue.
Adjusted to exclude one-time items, earnings per share were $0.51 for the quarter, 4¢ under the Street, where analysts were looking for EPS of $0.55 on sales of $1.36 billion.
The company said full-year sales grew 19% to $5.2 billion while net income climbed nearly 83% to $1.5 billion, or a diluted EPS of $2.38 and adjusted EPS of $2.22.
Edwards Lifesciences reaffirmed its full-year 2022 projection of adjusted EPS of $2.50 to $2.65 this year, and reiterated its top-line outlook of $5.5 billion to $6.0 billion for the year.
For the first quarter of 2021, Edwards Lifesciences said it expects revenue between $1.27 billion and $1.35 billion, and adjusted EPS of $0.54 to $0.62.
Investors reacted by sending EW shares down more than 5% to $102.97 by afternoon trading today. MassDevice and MDO‘s MedTech 100 Index, which includes stocks of the world’s largest medical device companies, was down slightly.
“We expect continued growth and progress in 2022. We are enthusiastic about the continued expansion of transcatheter-based therapies for the many structural heart patients still in need, which positions us well for long-term success,” Mussallem said in a news release. “As the global population ages and cardiovascular disease remains the largest health burden, we believe that the opportunity to serve our patients will nearly double between now and 2028. We are confident that our patient-focused innovation strategy can transform care and bring value to patients and the healthcare system.”
BTIG analysts Marie Thibault and Sam Eiber kept their rating of EW shares at neutral: “We continue to believe this is a temporary blip and that U.S. TAVR sales can recover nicely throughout the remainder of 2022.”
This story originally ran on Jan. 26, 2022. Updated Jan. 27 with stock price and analyst comment.