By Susan Kelly
Feb 4 Boston Scientific Corp on Tuesday
reported higher-than-expected quarterly results, citing
improving demand for its devices that manage irregular heart
But U.S. sales of implantable cardioverter defibrillators
(ICDs), which shock dangerously fast heartbeats back to normal,
were flat. Some analysts were looking for stronger sales of the
important product after competitor St. Jude Medical Inc
reported positive sales growth last month.
"There were some fits and starts in the quarter," said
Jefferies analyst Raj Denhoy. "The U.S. ICD business was
Investors have anticipated a recovery in the market for
heart rhythm products after several years of declining sales.
The U.S. economic downturn had reduced demand for healthcare,
and medical studies suggested the devices have been overused.
Boston Scientific is also expected to benefit from the
introduction of its S-ICD system. The "lead wires" in this new
type of implantable defibrillator are threaded up the sternum
rather than attached to the heart.
Boston Scientific last year began to see growth in revenue,
which had been falling for years, after the company embarked on
a turnaround strategy involving cost cuts and restructuring
In the fourth quarter, Boston Scientific's profit rose to
$108 million, or 8 cents a share, from $60 million, or 4 cents a
share, a year earlier.
Excluding acquisition, divestiture, litigation and
restructuring charges, earnings were 21 cents a share. Analysts
on average had expected 13 cents, according to Thomson Reuters
Sales rose 1 percent to $1.84 billion, while analysts had
forecast $1.83 billion.
Worldwide sales of cardiac rhythm management products,
including pacemakers and ICDs, climbed 2 percent to $468 million
in the fourth quarter.
Sales of interventional cardiology products, primarily
stents that are inserted into clogged heart arteries to help
prop them open, fell 6 percent to $500 million.
Boston Scientific forecast 2014 earnings of 75 cents to 80
cents a share, excluding special items, on revenue of $7.3
billion to $7.5 billion.
Analysts on average were expecting a profit of 52 cents a
share on revenue of $7.41 billion.
Shares of Boston Scientific more than doubled last year on
anticipation of a recovery in the heart rhythm device market and
enthusiasm about the company's product pipeline.
The stock was down 0.3 percent at $12.97 in midday trading
on the New York Stock Exchange.