Medtronic 2015 Annual Report Download - page 49

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Understanding Our Financial Information
The following discussion and analysis provides information management believes to be relevant to understanding the financial
condition and results of operations of the Company and its subsidiaries. The Company became the successor registrant to
Medtronic, Inc. subsequent to the Transactions described below. You should read this discussion and analysis along with our
consolidated financial statements and related notes thereto as of April 24, 2015 and April 25, 2014 and for each of the three
fiscal years ended April 24, 2015, April 25, 2014, and April 26, 2013.
On January 26, 2015, pursuant to the Transaction Agreement, the Company acquired Covidien and Medtronic, Inc.
(collectively, the Transactions). Following the consummation of the Transactions, Medtronic, Inc. and Covidien became
subsidiaries of the Company. In connection with the consummation of the Transactions, the Company re-registered as a public
limited company organized under the laws of Ireland.
On January 26, 2015, (a) each Covidien ordinary share was converted into the right to receive $35.19 in cash and 0.956 of a
newly issued ordinary share of the Company, and (b) each share of Medtronic, Inc. common stock was converted into the right
to receive one newly issued ordinary share of the Company. The total cash and stock value of the Transactions was
approximately $50 billion.
This Annual Report on Form 10-K relates to Medtronic’s fiscal year ended April 24, 2015. Due to the timing of the
Transactions, the results of operations of Covidien are only reflected in Medtronic’s results of operations for the fourth quarter
of fiscal year 2015, which will affect comparability to the prior year historical operations of Medtronic, Inc. throughout this
Annual Report on Form 10-K. In addition, we incurred $550 million in acquisition-related expenses in fiscal year 2015,
primarily related to the Covidien acquisition.
For further information regarding the Acquisition, see the section entitled “Acquisition and Investments — Acquisition of
Covidien” contained in “Item 1. Business” and Note 2 to the consolidated financial statements in “Item 8. Financial Statements
and Supplementary Data” in this Annual Report on Form 10-K.
Organization of Financial Information Management’s discussion and analysis, presented on pages 39 to 64 of this report,
provides material historical and prospective disclosures designed to enable investors and other users to assess our financial
condition and results of operations.
Statements that are forward-looking and not historical in nature are subject to risks and uncertainties. See “Item 1A. Risk
Factors” in this Annual Report on Form 10-K and “Cautionary Factors That May Affect Future Results” in this management’s
discussion and analysis for more information.
The consolidated financial statements are presented on pages 67 to 142 of this report, and include the consolidated statements of
income, consolidated statements of comprehensive income, consolidated balance sheets, consolidated statements of
shareholders’ equity, consolidated statements of cash flows, and the related notes, which are an integral part of the consolidated
financial statements.
Financial Trends Throughout this management’s discussion and analysis, you will read about transactions or events that
materially contribute to or reduce earnings and materially affect financial trends, but which includes charges or benefits that
results from facts and circumstances that vary in frequency and/or impact to our operations. We refer to these transactions and
events as Non-GAAP Adjustments. Management uses Non-GAAP Adjustments to assist in comparing business trends from
period to period on a consistent basis without regard to the impact of such Non-GAAP Adjustments and believes that these Non-
GAAP Adjustments are useful to investors in evaluating operating performance by providing better comparability between
reporting periods. Investors should not consider results reflecting Non-GAAP Adjustments in isolation from, or as a substitute
for, financial information prepared in accordance with generally accepted accounting principles in the U.S. (U.S. GAAP), and
are cautioned that Medtronic may calculate results reflecting Non-GAAP Adjustments in a manner that is different from other
companies. Please refer to “Net Income GAAP to Non-GAAP Reconciliation” for a reconciliation of our results of operations
prepared in accordance with U.S. GAAP to those adjusted results considered by management.
Our fiscal year-end is the last Friday in April, and therefore, the total weeks in a fiscal year can fluctuate between 52 and 53
weeks. Fiscal years 2015, 2014, and 2013 were 52-week years. Fiscal year 2016 is a 53-week year, with the additional week
occurring in the first quarter.
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