Boston Scientific reports quarterly loss
- Article by: JAMES WALSH
- Star Tribune
- July 26, 2012 - 8:13 PM
Medical device maker Boston Scientific Corp. reported a quarterly loss Thursday due to slack demand for its implantable heart devices.
The Natick, Mass.-based company, which employs 5,000 workers in Minnesota, reported a second-quarter net loss of $3.4 billion, or $2.39 a share, after charges. That compares to a profit of $146 million, or 10 cents a share, in the same period a year ago.
Quarterly sales fell to $1.83 billion from $1.97 billion. Leading the decline was a drop in sales of implantable cardiac devices -- such as pacemakers and defibrillators -- and heart stents. The company posted an impairment charge of $3.43 billion associated with its Europe, Middle East and Africa unit.
Adjusted earnings were 11 cents a share, beating Wall Street estimates by a penny.
The company's stock fell 6.75 percent to close at $4.97.
On a conference call, Boston Scientific CEO Hank Kucheman said, "There is no doubt that this was a tough quarter from a top-line perspective."
Boston Scientific's results have analysts taking a wait-and-see approach to what had been mild optimism that sluggish sales in implantable cardioverter defibrillators (ICDs) and other heart devices were in the rear view mirror.
"Up until last week, we thought the decline in ICD usage had stabilized," said Thom Gunderson, a senior analyst with Piper Jaffray & Co. "But with St. Jude and now Boston Scientific forecasting still slower ICD revenues, investors are readjusting their thinking and their valuations for these two stocks."
Boston Scientific officials said they estimate sales for the third quarter of 2012 to come in between $1.73 billion and $1.83 billion. The company estimates earnings per share to range from 6 to 9 cents. Adjusted earnings, excluding charges, are estimated to be 14 to 17 cents per share.
The company estimated that sales for the full year 2012 will range between $7.2 billion and $7.4 billion, with full year losses of $2.16 to $2.09 per share. Adjusted earnings for the year are estimated at 62 to 68 cents per share.
James Walsh 612-673-7428
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