UPDATE 2-Boston Scientific profit exceeds expectations as sales rise
(Adds outlook, share movement, analyst comment)
July 24 (Reuters) - Boston Scientific Corp, which makes medical equipment, on Thursday reported a slightly higher-than-expected quarterly profit as improvements in its heart device business helped drive revenue up 4 percent.
Boston Scientific said cardiac rhythm management sales, which include implantable defibrillators and pacemakers, rose 4 percent to $497 million in the second quarter from a year earlier after falling last quarter. Interventional cardiology, which includes sales of stents, rose 1 percent to $528 million.
The Marlborough, Massachusetts company has cut jobs and other costs during the past several years to deal with slack global demand for medical services and products due to the economic downturn.
Boston Scientific took $281 million in charges during the quarter to cover restructuring and other one-time costs, bringing its profit to $4 million, or nil per share. That is a decline from $130 million, or 10 cents per share, a year earlier.
Excluding special items, earnings came to 21 cents per share, beating expectations for 19 cents, according to Thomson Reuters I/B/E/S.
Revenue rose to $1.87 billion from $1.79 billion, in line with analysts' expectations.
Shares were unchanged at around $13.02 in morning trading.
"I think one reason the stock is not up more is that it did rally into the quarter," said RBC Capital Markets analyst Glenn Novarro.
"The quarter was very strong for them in stents and ICDs (implantable cardioverter defibrillators), and that's why investors buy the stock," he said.
Boston Scientific shares are up 8.5 percent this year and 4.8 percent in the past week.
The company raised its 2014 profit outlook because of the higher revenue as well as an anticipated tax rate of 12 percent to 14 percent rather than the 13 percent to 15 percent it had projected, Chief Financial Officer Daniel Brennan said during a conference call with investors.
Boston Scientific forecast 2014 earnings per share at 79 cents to 83 cents, excluding items, up from a prior outlook of 77 cents to 82 cents.
The company narrowed its 2014 revenue forecast to a range of $7.33 billion to $7.43 billion from a previous outlook of $7.30 billion to $7.50 billion. Analysts were expecting $7.39 billion. (Reporting by Caroline Humer; Editing by Franklin Paul, Chizu Nomiyama and Lisa Von Ahn)
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