Medtronic 2015 Integrated Performance Report

1 Further, together 2015 Integrated Performance rePortceo Letter ..3comPany overvIew ..5 SuStaInabILIty rISk and oPPortunIty ..7vaLue to SocIety ..10acceSS ..11 PatIent Safety ..20fInancIaL Strength ..25communIty InveStmentS ..34workIng reSPonSIbLy ..40governance and engagement ..41emPLoyeeS ..49envIronment ..59 SuPPLy chaIn ..65awardS and recognItIon ..68f y1 5 data S u m m a ry ..69about thIS Report ..74gLobaL rePortIng InItIatIve Index ..77medtronIc 2015 Integrated Performance Report | Table of ConTenTs 2table oF ContentsCover PhoTo:read hina s Story on p a g e our early days as a company, the Medtronic mission has remained the same: to alleviate pain, restore health, and extend life for people around the world. we have worked hard to be at the forefront of medical technology innovation, challenging ourselves to develop high-quality products and therapies that positively impact people s lives.

2 We have accomplished a lot today more than 62 million people benefit from our technologies each year. This equates to improving the lives of two people every second of every also recognize that we participate in global healthcare systems that face intense clinical and economic challenges. If not properly addressed, these issues can serve to undermine global growth and development and leave millions of people around the world untreated. no single entity in the healthcare system can solve these challenges alone. we re committed to putting the full power of our technologies, resources, and our people to work with new partners, in new ways, to create a new era in healthcare. that s a key reason we acquired covidien to expand our breadth to treat more people for more diseases, no matter where they are located, more efficiently than ever before. Our future promises even greater social impact.

3 Due to the timing of this acquisition late in our fiscal year, however, the data in this Report excludes Covidien s operations, except where noted. we re proud of the value we provided in fy2015 and look forward to contributing even more in the future by partnering with others to take healthcare further, together. fY2015 hIGhlIGhTsn Our business achieved solid financial results in FY2015, achieving $ billion in revenue and $ billion net earnings allowing us to advance our mission and invest in transforming the Research is at the heart of innovation. We invested $ billion, or percent of total sales, in R&D including new ways of addressing health problems in emerging markets such as china and Our people are the key to transforming healthcare. We invested more than $ million in employee training and development programs. n To build greater healthcare capacity and access, we invested more than $ million in training 50,000+ medical professionals around the we demonstrated our commitment to patient safety by exceeding regulatory requirements in our quality processes.

4 Now we re focused on combining the best practices of covidien with Medtronic into a single system that delivers even greater quality We invested in our communities, targeting our philanthropic efforts where they can have the most impact. We donated percent of our global pretax profits to charitable causes, and matched the generosity of our employees $ million donations with nearly $20 million more to nonprofits of employees we continued to make good progress toward our ambitious 2020 environmental Performance goals, cutting carbon dioxide emissions and water use by 7 percent. non-regulated waste decreased by 5 We are also pleased that with Covidien joining the Medtronic family that now two patients per second benefit from Medtronic therapies. this is and has always been one of our most important metrics how many lives we impact around the financial health is increasingly linked to our social commitments and environmental Performance .

5 We have a unique opportunity to extend our mission as we integrate covidien and leverage the leading practices from both companies. by continually challenging ourselves to advance the limits of technology as well as our thinking we can lead a transition to value-based healthcare and increase access to care around the world. omar Ishrak Chairman and Chief Executive OfficermedtronIc 2015 Integrated Performance Report | Ceo leTTer 3 Ceo lettermedtronIc 2015 Integrated Performance Report | fY2015 fInanCIal hIGhlIGhTs 4$ MILLION INVESTED IN employee TRAINING AND DEVELOPMENTVALUE TO OF TOTAL SALES INVESTED IN RESEARCH AND DEVELOPMENT$ IN PHILANTHROPIC GIVINGBUSINESS GROWTHWORKING RESPONSIBLYNON-REGULATED WASTE DOWN 5%PER UNIT OF REVENUE FROM 2013CO2 EMISSIONS AND ENERGY USE DOWN 7%PER UNIT OF REVENUE FROM 201329,410 employee HOURSVOLUNTEERED THROUGH PROJECT 6FY2015 HIGHLIGHTSData excludes Covidien except where noted.

6 ** FY2015 based on Medtronic fiscal year as reported and reflects the one-quarter contribution of the Covidien transaction, which closed on January 26, 2015 .$ B*IN REVENUE alleviate Pain. restore health. extend life. this is our Mission at Medtronic . It s the reason we ve developed an unprecedented breadth and depth of innovative therapies for more than 60 years. and it s the reason millions of lives are improved by a Medtronic product or therapy each year. but we must do more. and we need to do it in partnership with others across the industry to address these three universal needs: n Improve outcomes for better caren Increase access to therapies so more people who can benefit from them are treatedn Improve healthcare delivery to increase efficiency and reduce overall costs our business strategy consist of three strategic priorities therapy innovation, economic value creation, and globalization aimed at addressing those universal needs (see financial Strength for more information).

7 Our acquisition of covidien on January 26, 2015 marks a significant milestone, making us uniquely positioned to alleviate pain, restore health, and extend life for more patients around the world. together as one company, we remain committed to improving the lives of patients through ground-breaking medical technologies and innovative healthcare services and solutions. Solutions that reach more patients in more markets while delivering value for our customers. orGanIZaTIonal ProfIlethe combination of Medtronic and covidien has created a medical technology and services company with a comprehensive product portfolio, a diversified growth profile, and broad geographic reach. our four groups cardiac and vascular, minimally Invasive therapies, restorative therapies, and diabetes are committed to improving the lives of people through a wide range of medical technologies, services, and solutions.

8 Cardiac and vascular Groupour cardiac and vascular group (cvg) brings all Medtronic cardiac and vascular businesses together into one cross-functional, collaborative operating unit. cvg provides innovative and Medtronic 2015 Integrated Performance Report | ComPanY overvIew 5 CoMPany overvIewKey FaCts about the new Medtronic PlCnumber of employees85,000+*number of countries we operate inapproximately 160research and development spend$1,640 mnumber of patents53,000+* With the acquisition of Covidien, we had 85,000 full-time equivalent employees at fiscal year-end. Not including Covidien employees, Medtronic employed 46,638 people at the end of fy2015 (excluding temporary or contingent workers).$15,508F Y2 011$3,096FY2012$16,184$ 3, 617FY2013$16, 590$3,467FY2014$17,005$3,065FY2015*$20,2 61$2,675 TOTAL SALES AND NET EARNINGS($ millions)*Total SalesNet Earnings*F Y2015 based on Medtronic fiscal year as reported and reflects the one-quarter contribution of the Covidien transaction which closed on January 26, 2015 Integrated Performance Report | ComPanY overvIew 6sCoPe of ThIs rePorTthis Report covers Medtronic operations for the fiscal year ended april 24, 2015 (fy2015).

9 On January 26, 2015 , we completed the acquisition of covidien now operating primarily as the minimally Invasive therapies group, with its Peripheral vascular business now a part of cvg and neurovascular business now a part of rtg. due to the timing of this acquisition late in fy2015, the data in this Report excludes covidien s operations, except where otherwise noted. our 2016 Report will be our first that covers our combined company, region, and kidneys, as well as obesity and preventable Surgical Solutionsn Patient monitoring and recoveryrestorative Therapies Groupthe restorative therapies group (rtg) provides innovative, life-changing restorative therapies and services to meet the needs of millions of people worldwide who suffer from a wide range of chronic medical conditions. n Spinen neuromodulationn Surgical technologiesn neurovascularDiabetes Groupthe Medtronic diabetes group is the world leader in advanced diabetes management solutions, including Integrated diabetes management systems, insulin pump therapy, continuous glucose monitoring systems, and therapy management software.

10 The group also provides unrivaled, around-the-clock service and support to consumers and healthcare professionals. n Intensive Insulin managementn diabetes Services and Solutionsn non-Intensive diabetes therapies$9, 361 Cardiac and VascularGroup$2,387 Minimally InvasiveTherapies Group$6,751 Restorative TherapiesGroup$1,762 DiabetesGroupFY2015 TOTAL SALES BY BUSINESS UNIT($ billions)*Total Sales $20, 261*FY2015 based on Medtronic fiscal year as reported and reflects the one-quarter contribution of the Covidien transaction which closed on January 26, solutions, including the industry s broadest portfolio of technologies as well as programs and services that drive economic value across the care continuum. n cardiac rhythm and heart failuren coronary and Structural heartn aortic and Peripheral vascularminimally Invasive Therapies Groupthe minimally Invasive therapies group (mItg) aspires to enable earlier diagnoses, better treatments, faster complication-free recoveries, and enhanced patient outcomes using less invasive solutions.