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Edwards Lifesciences Corp. (NYSE:EW)

This company has been moved to the archive! The financial data has not been updated since February 14, 2022.

Common-Size Income Statement
Quarterly Data

Edwards Lifesciences Corp., common-size consolidated income statement (quarterly data)

Microsoft Excel
3 months ended: Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019 Dec 31, 2018 Sep 30, 2018 Jun 30, 2018 Mar 31, 2018 Dec 31, 2017 Sep 30, 2017 Jun 30, 2017 Mar 31, 2017
Net sales 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
Cost of sales -23.28 -23.79 -24.30 -24.12 -24.86 -24.63 -25.75 -23.49 -24.38 -26.73 -27.97 -23.34 -24.01 -24.81 -26.09 -26.11 -26.48 -25.96 -25.08 -24.40
Gross profit 76.72% 76.21% 75.70% 75.88% 75.14% 75.37% 74.25% 76.51% 75.62% 73.27% 72.03% 76.66% 75.99% 75.19% 73.91% 73.89% 73.52% 74.04% 74.92% 75.60%
Selling, general, and administrative expenses -31.89 -27.81 -27.22 -27.19 -28.40 -26.93 -29.72 -27.27 -29.57 -27.99 -28.38 -28.23 -29.47 -29.73 -29.13 -28.61 -30.02 -29.77 -28.96 -25.99
Research and development expenses -17.51 -18.17 -16.37 -17.01 -16.42 -17.14 -19.69 -16.60 -16.51 -17.87 -17.66 -17.26 -16.68 -17.85 -16.33 -16.00 -16.50 -17.40 -15.97 -14.57
Intellectual property litigation income (expenses), net -0.53 -0.36 -0.17 -0.53 -0.39 -0.74 -41.07 -1.11 -1.18 -0.72 -0.64 -0.46 -19.93 -0.87 -0.58 -0.64 11.81 -1.67 -0.91 -1.15
Change in fair value of contingent consideration liabilities 1.36 -0.08 7.46 0.37 -0.44 0.79 -2.12 0.19 1.58 0.21 -0.74 -0.67 1.43 0.71 -1.16 -0.42 -0.29 2.03 -0.37 -0.12
Special charges 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -3.46 0.00 0.00 -2.42 -11.89 0.00 0.00 0.00 0.00 -1.18 0.00 0.00
Other operating expenses 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -0.08 0.00
Operating income (loss) 28.16% 29.79% 39.40% 31.52% 29.49% 31.36% -18.35% 31.73% 26.47% 26.90% 24.61% 27.61% -0.54% 27.45% 26.71% 28.22% 38.51% 26.05% 28.63% 33.76%
Interest income (expense), net 0.04 -0.06 -0.07 0.02 0.04 0.07 0.19 0.40 0.37 0.26 0.22 0.20 0.18 -0.06 0.00 0.09 0.11 -0.01 -0.17 -0.27
Special gains (charges), net 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.79 -2.08 -0.06 -3.71 0.00
Other income (expense), net 0.11 0.11 0.32 0.45 0.35 0.50 -0.03 0.17 0.03 0.42 0.13 0.18 0.17 0.03 -0.12 0.35 -0.09 -0.19 -0.33 -0.26
Income (loss) before (provision for) benefit from income taxes 28.30% 29.84% 39.64% 32.00% 29.88% 31.93% -18.18% 32.29% 26.87% 27.58% 24.96% 28.00% -0.18% 27.43% 26.60% 29.45% 36.45% 25.78% 24.42% 33.23%
(Provision for) benefit from income taxes -3.08 -3.88 -4.07 -4.20 -3.91 -3.43 5.01 -4.78 -3.01 -2.47 -2.67 -2.85 0.90 -2.51 3.36 -6.36 -36.77 -5.08 -2.32 -7.18
Net income (loss) 25.22% 25.96% 35.57% 27.80% 25.97% 28.50% -13.18% 27.52% 23.87% 25.11% 22.29% 25.15% 0.72% 24.92% 29.96% 23.09% -0.32% 20.71% 22.11% 26.06%

Based on: 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).

The financial performance over the analyzed period is characterized by strong and stable gross margins contrasted with significant volatility in operating and net income due to non-recurring expenses. While core operational efficiency remains high, bottom-line results are periodically impacted by legal costs and special charges.

Gross Profitability
Gross profit margins exhibit remarkable stability, consistently remaining within the 72% to 77% range. After a slight dip to 72.03% in June 2019, the margin trended upward, ending December 2021 at 76.72%. This indicates a sustained ability to manage direct production costs relative to sales growth.
Operating Expense Trends
Selling, general, and administrative (SG&A) expenses typically fluctuate between 26% and 30% of net sales, although a peak of 31.89% was observed in December 2021. Research and development (R&D) spending is consistently maintained between 14% and 20% of net sales, reflecting a steady commitment to product innovation throughout the five-year period.
Non-Recurring Impacts and Volatility
Operating income is subject to sharp fluctuations driven primarily by intellectual property litigation and special charges. A significant negative impact occurred in December 2018, with litigation expenses reaching 19.93% of sales, and a more severe contraction in June 2020, where litigation expenses of 41.07% led to an operating loss of 18.35%. Special charges also intermittently reduced margins, notably in December 2018 and December 2019.
Net Income and Bottom-Line Performance
Net income margins generally align with operating trends, typically oscillating between 20% and 28%. The volatility seen in operating income is mirrored in net income, with a notable loss of 13.18% in June 2020. However, the company demonstrated strong recovery capabilities, achieving a peak net income margin of 35.57% in June 2021 before stabilizing around 25% by the end of the period.
Other Income and Tax Effects
Interest income and other non-operating items remain negligible as a percentage of net sales. Tax provisions show variability, including a significant provision of 36.77% in December 2017, which resulted in a marginal net loss for that quarter despite a positive operating income of 38.51%.

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