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Fourth quarter net sales increased 10.3 percent to $293.0 million,compared to $265.6 million in the same quarter last year. Underlying salesgrowth was 9.7 percent excluding the impact of $11.4 million of sales fromdiscontinued products and a $13.4 million contribution from foreign exchange.
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"Our Critical Care franchise achieved 10 percent sales growth for fullyear 2007, capped by a very strong fourth quarter," said Michael A. Mussallem,Edwards Lifesciences' chairman and CEO. "In the quarter, our market-leadingHeart Valve Therapy franchise reported 9 percent growth and was led by stronginternational sales.
"With the successful launch of our SAPIEN valve in Europe, transcatheterheart valves contributed over $2 million of sales in the fourth quarter. Wecontinue to build momentum and are confident we will achieve more than$20 million of global transcatheter heart valve sales in 2008," continuedMussallem.
"We are the first company to provide the Ascendra transapical deliverysystem, which was recently approved for sale in Europe and just last week wascleared by the FDA to be included in our U.S. PARTNER trial."
Sales Results
For the fourth quarter, the company reported Heart Valve Therapy sales of$131.4 million, which included a $6.4 million positive contribution fromforeign exchange. "Strong sales growth in international markets, driven byrecent product launches and share gains, is offsetting a U.S. market thatremains competitive," said Mussallem.
Critical Care sales of $113.0 million grew 20.0 percent over last year,which included a $4.8 million positive contribution from foreign exchange."Sales of new products, led by our FloTrac system, continued to be the biggestgrowth driver this quarter," added Mussallem. "Our world-leading pressuremonitoring products continued to gain share. In addition, growth was boostedby a sharp up-tick in sales of hardware products."
Cardiac Surgery Systems sales for the quarter were $15.1 million, adecline from $21.9 million in the same quarter last year due to the 2006 saleof the company's Brazil-based perfusion product line and this year's sale ofthe TMR product line. "During the quarter, we completed our acquisition ofCardioVations and are excited about integrating these minimally invasiveproducts into our portfolio," stated Mussallem.
Vascular sales grew 19.5 percent to $25.1 million compared to the sameperiod in 2006. "The strong growth this quarter was driven by global sales ofthe LifeStent product line," Mussallem said. "Consistent with our long-termstrategy, we completed the sale of the LifeStent product line in January."
Domestic and international sales for the fourth quarter were$123.9 million and $169.1 million, respectively.
Additional Operating Results
For the quarter, Edwards' gross profit margin was 66.0 percent compared to63.3 percent in the same period last year, driven primarily by a moreprofitable product mix.
Selling, general and administrative expenses were $114.5 million for thequarter, or 39.1 percent of sales, compared to $95.1 million last year. Thisincrease was due to expected higher levels of spending for both the EdwardsSAPIEN transcatheter heart valve launch in Europe and sales-related costs inthe U.S., as wel
