Segment And Geographic Information

6 Months Ended

Jul. 02, 2011

Segment And Geographic Information

Segment And Geographic Information

NOTE 14 – SEGMENT AND GEOGRAPHIC INFORMATION

Segment Information

The Company's four operating segments are Cardiac Rhythm Management (CRM), Cardiovascular (CV), Atrial Fibrillation (AF), and Neuromodulation (NMD). The primary products produced by each operating segment are: CRM – ICDs and pacemakers; CV – vascular products, which include vascular closure products, pressure measurement guidewires, optical coherence tomography (OCT) imaging products, vascular plugs and other vascular accessories; and structural heart products, which include heart valve replacement and repair products and structural heart defect devices; AF – EP introducers and catheters, advanced cardiac mapping, navigation and recording systems and ablation systems; and NMD – neurostimulation products, which include spinal cord and deep brain stimulation devices.

The Company has aggregated the four operating segments into two reportable segments based upon their similar operational and economic characteristics: CRM/NMD and CV/AF. Net sales of the Company's reportable segments include end-customer revenues from the sale of products they each develop and manufacture or distribute. The costs included in each of the reportable segments' operating results include the direct costs of the products sold to customers and operating expenses managed by each of the reportable segments. Certain operating expenses managed by the Company's selling and corporate functions, including all stock-based compensation expense, impairment charges, certain acquisition-related charges IPR&D charges, excise tax expense and special charges have not been recorded in the individual reportable segments. As a result, reportable segment operating profit is not representative of the operating profit of the products in these reportable segments. Additionally, certain assets are managed by the Company's selling and corporate functions, principally including trade receivables, inventory, corporate cash and cash equivalents, certain marketable securities and deferred income taxes. For management reporting purposes, the Company does not compile capital expenditures by reportable segment; therefore, this information has not been presented as it is impracticable to do so.

The following table presents net sales and operating profit by reportable segment (in thousands):

	CRM/NMD		CV/AF		Other			Total
Three Months ended July 2, 2011:
Net sales	$	896,622	$	550,129	$	—		$	1,446,751
Operating profit		564,966		288,878		(528,760	)		325,084
Three Months ended July 3, 2010:
Net sales	$	882,835	$	429,934	$	—		$	1,312,769
Operating profit		556,653		244,397		(436,297	)		364,753
Six Months ended July 2, 2011:
Net sales	$	1,750,061	$	1,072,203	$	—		$	2,822,264
Operating profit		1,100,913		553,300		(1,007,111	)		647,102
Six Months ended July 3, 2010:
Net sales	$	1,718,866	$	855,599	$	—		$	2,574,465
Operating profit		1,080,590		488,111		(857,941	)		710,760

The following table presents the Company's total assets by reportable segment (in thousands):

Total Assets	July 2, 2011		January 1, 2011
CRM/NMD	$	2,418,948	$	2,150,359
CV/AF		3,139,034		3,097,190
Other		3,537,415		3,318,899
	$	9,095,397	$	8,566,448

Geographic Information

The following table presents net sales by geographic location of the customer (in thousands):

	Three Months Ended				Six Months Ended
Net Sales	July 2, 2011		July 3, 2010		July 2, 2011		July 3, 2010
United States	$	678,327	$	690,095	$	1,354,402	$	1,339,028
International
Europe		410,758		331,443		780,070		668,523
Japan		156,714		129,593		304,207		258,255
Asia Pacific		106,145		80,419		198,655		149,307
Other (a)		94,807		81,219		184,930		159,352
		768,424		622,674		1,467,862		1,235,437
	$	1,446,751	$	1,312,769	$	2,822,264	$	2,574,465

           (a) No one geographic market is greater than 5% of consolidated net sales.

The amounts for long-lived assets by significant geographic market include net property, plant and equipment by physical location of the asset as follows (in thousands):

Long-Lived Assets	July 2, 2011		January 1, 2011
United States	$	994,201	$	965,936
International
Europe		99,253		85,961
Japan		27,570		25,583
Asia Pacific		77,013		74,537
Other		186,479		171,914
		390,315		357,995
	$	1,384,516	$	1,323,931