WASHINGTON (dpa-AFX) - Medical device maker Boston Scientific Corp. (BSX) reported Thursday a profit for the second quarter that declined from last year, despite sales growth, hurt mainly by legal costs.
Striping down the charges, adjusted earnings per share topped analysts' expectations, and quarterly revenues matched their estimates.
The company also provided earnings and sales guidance for the third quarter, in line with Street view, and raised its adjusted earnings forecast for the full-year 2014.
'We had a strong second quarter, delivering balanced growth across our divisions. In particular, we are pleased with the improvement in both our Interventional Cardiology and Cardiac Rhythm Management divisions,' President and CEO Mike Mahoney said.
The Natick, Massachusetts-based company reported net income of $4 million or breakeven per share for the second quarter, sharply lower than $130 million or $0.10 per share in the prior-year quarter.
Results for the latest quarter include net charges of $0.21 per share, while the year-ago quarter included $0.08 per share of the same.
The company spent $267 million on legal costs. Boston Scientific is defending lawsuits saying its mesh or bladder sling systems caused complications for women after surgery to repair pelvic organ prolapse or stress urinary incontinence.
Excluding items, adjusted net income for the quarter was $285 million or $0.21 per share, compared to $247 million or $0.18 per share in the year-ago quarter.
On average, 22 analysts polled by Thomson Reuters expected the company to report earnings of $0.19 per share for the quarter. Analysts' estimates typically exclude special items.
Worldwide net sales for the quarter increased 4 percent to $1.87 billion from $1.81 billion in the same quarter last year, and matched twenty-one Wall Street analysts' consensus estimate of $1.87 billion.
The company noted that prior-year sales have been restated to reflect the realignment of certain product lines from Endoscopy to Peripheral Interventions as of January 1, 2014.
On a constant currency basis, international sales improved 5 percent, with a 7 percent growth in Europe and 14 percent growth in Emerging Markets. Emerging markets net sales represented 10 percent to total worldwide sales.
Cardiovascular sales grew 2 percent to $739 million, with interventional cardiology sales increasing 2 percent, and peripheral interventions improving 3 percent. Rhythm management sales grew 8 percent to $553 million, with cardiac rhythm management sales improving 5 percent and electrophysiology sales surging 55 percent.
MedSurg sales grew 5 percent to $580 million, with endoscopy sales increasing 4 percent, urology/women's health sales growing 7 percent, and neuromodulation sales rising 3 percent.
Looking ahead to the third quarter, the company expects adjusted earnings in a range of $0.18 to $0.20 per share, on projected revenues between $1.79 billion to $1.84 billion. Analysts expect the company to report earnings of $0.19 per share for the quarter, on quarterly revenues of $1.83 billion.
For fiscal 2014, Boston Scientific raised its adjusted earnings guidance to a range of $0.79 to $0.83 per share from the prior forecast range of $0.77 to $0.82 per share. The company also narrowed its annual revenue guidance to between $7.325 billion and to $7.425 billion from the previously projected $7.30 billion and $7.50 billion.
Street is currently looking for full-year 2014 earnings of $0.80, on annual revenues of $7.39 billion.
'We remain confident in both our strategy and in our outlook for the year,' Mahoney added.
BSX closed Wednesday's regular trading session at $13.02, up $0.17 on a volume of 8.93 million shares. In the past 52-week period, the stock has been trading in a range of $9.60 to $14.08.
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