Boston Scientific 4Q profit drops 55 pct

NATICK, Mass. -Boston Scientific Corp.'s fourth-quarter earnings plunged 55 percent, as the medical device maker saw declining sales in two of its biggest businesses, interventional cardiology and cardiac rhythm management.

The Natick, Mass., company said sales fell 15 percent to $482 million in cardiac rhythm management, which includes pacemakers as well as surgically implanted defibrillators that monitor the heart and use electrical jolts to shock it back to a normal rhythm. Revenue dropped 7 percent to $594 million in interventional cardiology, which includes drug-coated stents designed to prop open arteries.

Company shares sank 5 percent, or 30 cents, to $5.79 in Thursday morning trading.

Boston Scientific earned $107 million, or 7 cents per share, in the three months that ended Dec. 31. That compares with earnings of $236 million, or 15 cents per share, in the final quarter of 2010. Adjusted net income, which excludes acquisition, litigation and restructuring charges among other items, was 13 cents per share.

Revenue dropped 8 percent to $1.85 billion, as sales gains in endoscopy and peripheral interventions helped offset decreases in the other categories.

Analysts surveyed by FactSet expected, on average, earnings of 8 cents per share on $1.91 billion in revenue.

The company also said selling, general and administrative expenses, its largest operating expense, fell 9 percent to $621 million.

"Although we recognize the ongoing challenges of today's environment, we continue to make progress with new product introductions, cost-saving initiatives and a strengthened presence in emerging markets," CEO Hank Kucheman said in a statement.

Boston Scientific and other medical device makers have struggled in recent years to make up for lower sales of products like defibrillators and heart stents, amid cost-cutting efforts by hospitals and medical studies suggesting the implants are overused. Device makers have seen profits squeezed by a downturn in elective procedures, as patients delay surgery because of economic hardship.

For the full year, Boston Scientific earned $441 million, or 29 cents per share, on $7.62 billion. That was the company's first annual profit since 2005, before its $27 billion dollar purchase of defibrillator maker Guidant.

Boston Scientific expects adjusted earnings of 11 cents to 14 cents per share in the first quarter of 2012 and 60 cents to 70 cents per share for the full year.

Analysts expect earnings of 10 cents per share in the first quarter and 47 cents per share for the year.