Boston Scientific profit falls due to reduced demand
Net income dropped to $142 million (€102.1m), or 9 cents a share, from $190m, or 13 cents, a year earlier, the Natick, Massachusetts- based company said Thursday. Earnings — excluding one-time items — were 15 cents a share, beating by 6 cents the average estimate of 22 analysts surveyed by Bloomberg.
Boston Scientific has been stymied by slowing demand and falling prices for its main products to treat abnormal heart rhythms and open clogged arteries. Hank Kucheman assumed the role of interim chief executive officer Thursday, a position he will hold until Michael Mahoney, former chairman of Johnson & Johnson’s medical device group, takes the helm next year.
The medical device maker is on schedule to post its first annual profit since 2005. The company forecast adjusted earnings of 67 to 70 cents a share for the year, up from the 64 to 70 cents it projected earlier. Sales for 2011 will be between $7.62bn and $7.72bn.
Analysts estimated sales of $7.78bn for the year, according to Bloomberg data.
Boston Scientific reported third-quarter revenue of $1.87bn, falling short of analysts’ estimates of $1.91bn and sales of $1.92bn a year earlier. US sales of defibrillators used to shock a stopped heart back into a normal rhythm were $225m, down from $280m a year earlier, while worldwide sales declined 11% to $360m.
The market weakened more than the company expected in July and August, likely because of vacations and job changes, chief financial officer, Jeff Capello, said on a conference call. There has been an increase in demand since then, he said.
“Particularly the end of September the volumes increased, and as we look at our results for the first 10, 12 days in October, they stepped up again, which gives us some confidence that things are starting to come back a little,” Capello said. “But it’s too early to tell.”
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