Heart device giant Boston Scientific Corp. said Thursday that it is making progress on its companywide restructuring plan, but also reported a quarterly loss as sales of heart devices continue to sink.
In January, Boston Scientific reorganized its business from geographic regions to global business units, and announced 900 to 1,000 job cuts globally. As a result, the company has three new global reportable segments consisting of cardiovascular, rhythm management and medical surgery.
The company did not respond to an e-mail query Thursday asking how many people in the Twin Cities lost their jobs.
Despite the reorganization, Zacks Investment Research said in a report Thursday that it remains “cautious,” as the company’s core segments — implantable cardioverter defibrillator and drug-coated stents (contributing 35 percent of sales) — “continue witnessing several headwinds.”
“We continue to be encouraged but not satisfied with our operating performance,” said CEO Mike Mahoney in a statement. “We continue to make strong progress on our strategy to return to consistent sales and earnings-per-share growth.”
Like its med-tech brethren, Boston Scientific is facing declining demand for its stalwart products, including heart stents and defibrillators. Sales in the division that includes stents — which prop open clogged arteries — declined 16 percent in the quarter.
Likewise, sales of the cardiac rhythm management unit, which includes heart-shocking defibrillators and heart-pacing pacemakers, dropped 5 percent to $478 million.
In its report Zacks said, “The U.S. defibrillator market remains an overhang for Boston Scientific and its peers. The [drug-coated stent] business in the U.S. has been witnessing challenges due to pricing pressure, lower procedural volume, lower penetration rates and share losses” related to a new Medtronic stent.
The company reported a loss of $354 million in the quarter ended March 31, or 26 cents a share, compared with a profit of $113 million, or 8 cents a share, the same period last year.
The results include $578 million in charges for a goodwill write-down, plus legal and restructuring costs. Excluding one-time charges, the company earned 10 cents a share, compared with 9 cents a share predicted by Wall Street analysts.
Sales in the quarter decreased 6 percent to $1.76 billion.
The company’s shares increased 18 cents to close at $7.54 on Thursday.