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UPDATE 3-Medtronic expects quick recovery in elective procedures by end of Q4

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Dania Nadeem and Trisha Roy
·2 min read
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(Adds shares, details on China business, company comments)

By Dania Nadeem and Trisha Roy

Feb 23 (Reuters) - Medtronic Plc expects a fairly quick recovery in non-urgent procedures by the end of the fourth quarter despite a resurgence in COVID-19 cases, Chief Executive Officer Geoff Martha told Reuters on Tuesday.

Shares of the world's largest standalone medical device maker rose 2.7% to $118.81 in early trade.

"We're expecting March to be much stronger than February and getting back to pre-COVID-19 levels by the end of our fiscal quarter," Martha said, adding the worst was behind for the company with the second wave of infections in the United States.

The company also beat third-quarter profit estimates, boosted by better-than-expected sales of its medical devices and strong demand for its ventilators.

Sales from its emerging markets, which includes China, fell 7.6% to $493 million from the previous year. The company, however, said its China business was back to normal and that is not expected to change.

The Dublin-based company does not separately disclose sales figures from its China business.

Medtronic, which had ramped up production of ventilators to help severely ill COVID-19 patients breathe, said it expects demand for ventilators to normalize in the future quarters but remain above pre-COVID-19 levels.

"We're seeing ventilator growth come down and expect that to continue into next year. But keep in mind, ventilator is a small part of Medtronic," said Chief Financial Officer Karen Parkhill.

As vaccination rollouts take place across the United States, sales of medical device makers are expected to bounce back to normal. However, Medtronic said it does not expect an impact for at least two more months.

The company's minimally invasive therapies business unit, which includes ventilators, brought in revenue of $2.31 billion in the quarter, beating estimates of $2.24 billion.

Excluding items, Medtronic earned $1.29 per share, beating analysts' expectations of $1.15 per share, according to Refinitiv.

(Reporting by Dania Nadeem and Trisha Roy in Bengaluru; Editing by Amy Caren Daniel and Krishna Chandra Eluri)