8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):    January 26, 2005

ST. JUDE MEDICAL, INC.
(Exact name of registrant as specified in its charter)

Minnesota	0-8672	41-1276891
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

One Lillehei Plaza, St. Paul, MN	55117
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (651) 483-2000

Not applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.   Results of Operations and Financial Condition.

On January 26, 2005, the Registrant issued a press release concerning financial results for the fourth quarter and full-year 2004. A copy of which is furnished herewith as Exhibit 99.1.

Item 9.01.   Financial Statements and Exhibits.

(c)    Exhibits:

99.1 Press release issued by the Company concerning financial results for the fourth quarter and full-year 2004.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized on this 26^th day of January, 2005.

ST. JUDE MEDICAL, INC.

By:   /s/   Kevin T. O’Malley

Kevin T. O’Malley

Vice President and

General Counsel

EXHIBIT INDEX

Exhibit No.	Description of Exhibit
99.1	Press Release dated January 26, 2005, announcing the results of operations of the Company for the fourth quarter and full-year 2004.

EX-99.1

Exhibit 99.1

St. Jude Medical Reports 2004 Results

St. Paul, MN, January 26, 2005 — St. Jude Medical, Inc. (NYSE: STJ) today reported fourth quarter and full-year 2004 sales and earnings, led by sales of the Company’s implantable cardioverter defibrillator (ICD) products.

Net sales for the fourth quarter of 2004 were $611 million, compared to $519 million in the fourth quarter of 2003, an increase of 18%. Favorable foreign currency translation comparisons increased fourth quarter sales by about $17 million.

Net sales for 2004 were $2,294 million compared to $1,933 million in 2003, an increase of 19%. Favorable foreign currency translation comparisons increased 2004 sales by about $73 million.

Reported net earnings for the fourth quarter of 2004 were $125 million or $.33 per diluted share compared to $92 million, or $.25 per diluted share in the fourth quarter of 2003, adjusted for the Company’s stock split that was effective on November 1, 2004. During the fourth quarter of 2004, St. Jude Medical recorded three non-recurring items. First, in connection with the acquisition of Irvine Biomedical, Inc, which was completed on October 7, 2004, the Company recorded a special charge of $9.1 million related to purchased in-process research and development. Second, the Company settled a patent infringement lawsuit with Edwards LifeSciences Corporation and recorded a pre-tax special charge of $5.5 million. Third, during the quarter, St. Jude Medical concluded tax audits resulting in a $14 million reversal of previously recorded income tax expense. Net earnings for the fourth quarter, excluding these non-recurring items, were $123 million or $.33 cents per diluted share, a $31 million or 34% increase over the $92 million reported in the fourth quarter of 2003.

Reported net earnings for 2004 were $410 million, or $1.10 per diluted share compared to $337 million, or $.91 cents per diluted share in 2003, an increase in earnings per diluted share of 21%. Reported net earnings for 2004 include pre-tax special charges totaling $35 million recorded in the third quarter for the discontinuation of the Company’s Symmetry™ Bypass System Aortic Connector product line and the non-recurring items recorded in the fourth quarter, as previously described. Net earnings for 2004, excluding these non-recurring items, were $430 million or $1.16 per share, a $93 million or 28% increase over the $337 reported in 2003.

St. Jude Medical Chairman, President and Chief Executive Officer Daniel J. Starks said, “2004 was a year of outstanding sales and earnings growth for St. Jude Medical. Sales increased 18% in the fourth quarter and 19% for the full year. Excluding non-recurring items, EPS increased 32% in the quarter and 27% for the full year. The Company continued to improve gross margins and expand investment in R&D.”

Fourth quarter 2004 ICD product sales of $173 million increased 63% over the comparable quarter of 2003. ICD product sales for the full year 2004 were approximately $584 million, representing a 41% increase over 2003. The fourth quarter and year to date ICD product sales include sales of left-heart pacing leads of $7 million and $13 million, respectively. Prior to the fourth quarter of 2004, sales of left-heart pacing leads were included in pacemaker sales.

“The most significant event for the Company in 2004 was the launch of our high-voltage cardiac resynchronization products to treat heart failure in the U.S. We now have two full quarters experience in the U.S. CRT-D market. We are encouraged by our gain of market share and are optimistic we are well positioned for continued success in the CRT market, one of the most attractive and fastest-growing medical technology markets. We view the publication last week in the New England Journal of Medicine of the results of the SCD-HeFT clinical trial as a catalyst to help drive ICD penetration into a large pool of low ejection fraction patients who, until now, have not been candidates for ICDs,” Starks added.

Fourth quarter low-voltage or pacemaker sales of $223 million increased 3% over the fourth quarter of 2003. Pacemaker sales for the year were $890 million, an 8% increase over 2003. As mentioned above, these low-voltage or pacemaker sales no longer include sales of left-heart pacing leads.

In the electrophysiology (EP) catheter component of the Company’s cardiac rhythm management business, sales of EP catheters were $44 million, an increase of 22% over the comparable quarter of 2003 and for the year 2004 were $157 million, a 26% increase over 2003 EP catheter sales.

Fourth quarter sales of St. Jude Medical Angio-Seal™ vascular closure products of $77 million represent an increase of 22% over the fourth quarter of 2003. For the year 2004, vascular closure sales were $288 million, an increase of 32% over 2003. The Company recently announced the shipment of the 5 millionth Angio-Seal device. Sales of other cardiology and vascular access products were $27 million in the fourth quarter and $100 million for the full year 2004.

Fourth quarter sales of cardiac surgery products totaled $67 million, a decrease of 7% from the fourth quarter of 2003, in line with expectations and prior guidance. Full year cardiac surgery sales were $275 million, up 1.5% over 2003. Heart valve sales in the quarter were $61 million, a decrease of 8% from last year.

St. Jude Medical will provide detailed revenue and earnings guidance for 2005 during a conference call open to all investors. The Company anticipates total sales for 2005 to be in the range of $2.7 to $2.8 billion, up about 17-22% over 2004. The Company expects consolidated EPS for the first quarter of 2005 to be in the range of $.33 to $.35 per diluted share and for the full year 2005 in the range of $1.37 to $1.41, excluding the impact of purchased in-process R&D and special charges. The full year EPS expectation range does not reflect the impact of expensing stock options beginning July 1, 2005.

St. Jude Medical’s 4th quarter earnings conference call will be live (also archived for 90 days) on the following website:

http://phx.corporate-ir.net/phoenix.zhtml?c=73836&p=IROL-eventDetails&EventId=982441

Any statements made regarding the Company’s anticipated product approvals, sales, expenses and earnings are forward-looking statements which are subject to risks and uncertainties, such as those described in the Financial Report section of the Company’s Annual Report to Shareholders for the fiscal year ended December 31, 2003 (see pages 11-16). Actual results may differ materially from anticipated results.

St. Jude Medical, Inc. (www.sjm.com) is dedicated to the design, manufacture and distribution of innovative medical devices of the highest quality, offering physicians, patients and payers unmatched clinical performance and demonstrated economic value.

Condensed Consolidated Statements of Earnings
(Data in Thousands, Except EPS)
(Unaudited)

	Three Months Ended December 31, 2004							Three Months Ended Dec. 31, 2003			Year Ended December 31, 2004							Year Ended Dec. 31, 2003
	Reported		Adjustments			Before Adjustments		Reported			Reported		Adjustments			Before Adjustments		Reported
Net sales	$	610,676				$	610,676	$	518,583		$	2,294,173				$	2,294,173	$	1,932,514
Cost of sales
Cost of sales before special charges		175,363					175,363		155,614			666,977					666,977		603,091
Special charges												12,073		(12,073	)
Total cost of sales		175,363					175,363		155,614			679,050		(12,073	)		666,977		603,091
Gross profit		435,313					435,313		362,969			1,615,123		12,073			1,627,196		1,329,423
Selling, general & administrative		191,275					191,275		171,809			759,320					759,320		632,395
Research & development		77,840					77,840		66,301			281,935					281,935		241,083
Purchased R&D		9,100		(9,100	)							9,100		(9,100	)
Special charges		5,500		(5,500	)							28,810		(28,810	)
Operating profit		151,598		14,600			166,198		124,859			535,958		49,983			585,941		455,945
Other income (expense)		1,998					1,998		(97	)		1,234					1,234		(838	)
Earnings before taxes		153,596		14,600			168,196		124,762			537,192		49,983			587,175		455,107
Income tax (expense)		28,837		16,072			44,909		32,439			127,258		29,518			156,776		118,328
Net earnings	$	124,759	$	(1,472	)	$	123,287	$	92,323		$	409,934	$	20,465		$	430,399	$	336,779
Earnings per share
Basic	$	0.35	$	0.00		$	0.34	$	0.27		$	1.16	$	0.06		$	1.22	$	0.95
Diluted	$	0.33	$	0.00		$	0.33	$	0.25		$	1.10	$	0.06		$	1.16	$	0.91
Basic shares outstanding		357,468		357,468			357,468		345,307			353,454		353,454			353,454		353,913
Diluted shares outstanding		374,086		357,468			374,086		363,070			370,992		353,454			370,992		370,753

Condensed Consolidated Balance Sheets
(Data in Thousands)
(Unaudited)

	Dec. 31, 2004		Dec. 31, 2003
Cash & equivalents	$	688,040	$	461,253
Accounts receivable, net		630,983		501,759
Inventories, net		330,873		311,761
Other current assets		197,896		217,564
Property, plant & equipment, net		326,981		301,653
Other assets		1,055,974		759,492
Total assets	$	3,230,747	$	2,553,482
Short-term debt	$	0	$	12,115
Other current liabilities		605,393		498,200
Long-term debt		234,865		351,813
Deferred income taxes		56,561		89,719
Total equity		2,333,928		1,601,635
Total liabilities & equity	$	3,230,747	$	2,553,482