Stryker (SYK) Prelim. Q4 Revenue Tops Consensus

Stryker Corporation (NYSE: SYK) announced today that preliminary results for the fourth quarter and full year 2017 were:

Preliminary Fourth Quarter Highlights

Net sales grew 10.0% to $3.5 billion (8.7% constant currency)

Preliminary Full Year Highlights

Net sales grew 9.9% to $12.4 billion (9.8% constant currency)

Preliminary consolidated net sales of $3.5 billion and $12.4 billion increased 10.0% and 9.9% as reported in the fourth quarter and full year. Excluding the impact of foreign currency and acquisitions, net sales increased 8.1% and 7.1% in the fourth quarter and full year.

(Street sees Q4 sales of $3.39 billion and FY sales of $12.36 billion)

Based on our year-to-date performance, we expect 2017 adjusted net earnings per diluted share^(a) to be toward the high end of our previously announced range of $6.45 to $6.50. The foreign currency exchange impact on net sales in the fourth quarter was positive of approximately 1.2% and nominal in the full year.

(Street sees FY EPS of $6.47)

"We continued our momentum with strong organic sales growth of 8% for the fourth quarter and 7% for the full year," said Kevin A. Lobo, Chairman and Chief Executive Officer. "I would like to thank our teams for delivering these results, which were well balanced across businesses and geographies. We are also driving innovation through R&D and acquisitions that will fuel future growth. These investments will enable us to deliver sales growth at the high end of med tech and leveraged earning gains."

Preliminary Net Sales Analysis

Domestic net sales of $2.5 billion and $9.1 billion increased 9.3% and 10.1% as reported in the fourth quarter and full year. International net sales of $1.0 billion and $3.4 billion increased 11.7% and 9.4% as reported in the fourth quarter and full year. In constant currency, international net sales increased 7.3% and 9.0%.

Orthopaedics net sales of $1.3 billion and $4.7 billion increased 8.1% and 6.6% as reported in the fourth quarter and full year. In constant currency and excluding the impact of acquisitions, net sales increased 6.8% and 6.2%. During the fourth quarter we installed 35 Mako robots globally with 65% of systems in the field upgraded to the Mako Total Knee application. The continued Mako momentum contributed to U.S. knee sales growth of 10.5% in the fourth quarter.

MedSurg net sales of $1.6 billion and $5.6 billion increased 10.9% and 13.6% as reported in the fourth quarter and full year. In constant currency and excluding the impact of acquisitions, net sales increased 8.5% and 7.8%.

Neurotechnology and Spine net sales of $0.6 billion and $2.2 billion increased 11.5% and 8.2% as reported in the fourth quarter and full year. In constant currency and excluding the impact of acquisitions, net sales increased 10.0% and 7.6%.

2018 Outlook

With respect to the U.S. tax reform, we anticipate a modest headwind, which will be manageable within our overall financial targets. We will provide our 2018 sales and earnings guidance on January 30, 2018.

J.P. Morgan Healthcare Conference on Wednesday, January 10, 2018

Stryker will participate in the J.P. Morgan Healthcare Conference on Wednesday, January 10, 2018 at the Westin St. Francis Hotel in San Francisco, California. Kevin A. Lobo, Chairman and Chief Executive Officer, will represent the Company in a presentation scheduled for 8:00 a.m. Pacific Time.

A simultaneous webcast and replay of the Company's presentation will be available on Stryker's website at www.stryker.com.

Conference Call on Tuesday, January 30, 2018

Stryker will host a conference call on Tuesday, January 30, 2018 at 4:30 p.m., Eastern Time, to discuss the Company's operating results for the quarter and year ended December 31, 2017 and provide an operational update.

To participate in the conference call dial (844) 826-0610 (domestic) or (973) 453-3249 (international) and be prepared to provide confirmation number 2788919 to the operator.

A simultaneous webcast of the call will be accessible via the Company's website at www.stryker.com. The call will be archived on the Investors page of this site.

A recording of the call will also be available from 8:00 p.m., Eastern Time, on Tuesday, January 30, 2018, until 11:59 p.m., Eastern Time, on Tuesday, February 6, 2018. To hear this recording you may dial (855) 859-2056 (domestic) or (404) 537-3406 (international) and enter conference ID number 2788919.

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