Boston Scientific swings to a profit amid its turnaround plan

Dynagen Mini--Courtesy of Boston Scientific

Boston Scientific ($BSX) swung from a loss to a profit in the first quarter, posting net income of $133 million compared to a year-ago negative of $394 million.

Net sales rose 4% to $1.7 billion. Cardiovascular sales were basically flat at $700 million in Q1 compared to $701 million in 2013. Company officials said during the earnings call that they were disappointed in the performance of the cardiac rhythm management unit, which fell to $466 million from $478 million a year ago. They said the company's "portfolio gap" in the cardiac resynchronization device market and sluggishness in the U.S. was a problem, but pointed to strength abroad and new approvals, including in the CRT-D space.

In the quarter Boston Scientific announced the FDA approval of the Dynagen Mini and Inogen Mini implantable cardiac defibrillators as well as the Dynagen X4 and Inogen X4 CRT-Ds.

Rhythm management on the whole grew 2% to $524 million. Company officials said during the call that they expect the segment to receive a boost from the expected debut of the Promus Premier stent in Japan.

MedSurg sales were $548 million, up from $511 million a year ago. Endoscopy sales were $314 million, while urology and women's health contributed $125 million and neuromodulation sales rose 23% to $109 million.

Boston Scientific spent 2013 retrenching, executing thousands of layoffs in an effort to cut costs and improve profitability. The effort seems to be paying off.  

The company's guidance was only slightly changed from the previous quarter. Executives predict revenue for the year will hit between $7.3 billion and $7.5 billion, growing between 2% and 5%. Net income should hit between 36 cents and 41 cents per share (compared to the previous estimate of 35 to 40 cents), according to the company's earnings guidance.

- read the release

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