EX-99.1 2 exh99-1_13889.htm PRESS RELEASE DATED OCTOBER 14, 2005 WWW.EXFILE.COM, INC. -- 13889 -- BOSTON SCIENTIFIC CORPORATION -- EXHIBIT 99.1 TO FORM 8-K
LETTERHEAD
EXHIBIT 99.1


 
 
BOSTON SCIENTIFIC ANNOUNCES
THIRD QUARTER RESULTS
 
Company provides revised revenue and earnings guidance
 
Natick, MA (October 14, 2005) -- Boston Scientific Corporation (NYSE: BSX) today announced financial results for its third quarter ended September 30, 2005 and provided revised revenue and earnings-per-share guidance for the fourth quarter and full year of 2005.
 
Third Quarter Financial Results:
 
Net sales for the third quarter were $1.511 billion as compared to $1.482 billion for the third quarter of 2004, an increase of two percent. Worldwide coronary stent sales for the third quarter were $633 million as compared to $686 million for the third quarter of 2004. Worldwide sales of TAXUS® paclitaxel-eluting coronary stent systems were $601 million.
 
During the quarter, the Company recorded special charges of $616 million, net of tax. The after-tax special charges for the quarter consisted primarily of $598 million related to the previously announced settlement agreement with Medinol. The reported net loss for the quarter, including net special charges, was $269 million, or $0.33 per share.
 
Net income for the quarter, excluding net special charges, was $347 million, or $0.42 per share, as compared to $404 million, or $0.47 per share in the third quarter of 2004.
 
Fourth Quarter and Full Year 2005 Guidance:
 
For the fourth quarter, worldwide sales are expected to range between $1.550 billion and $1.590 billion. Earnings per share for the fourth quarter, excluding net special charges, are expected to range between $0.40 and $0.44 per share.
 
Worldwide sales for the full year are expected to range between $6.293 billion and $6.333 billion. Earnings per share for 2005, excluding net special charges, are expected to range between $1.81 and $1.85 per share.
 
“During the quarter, we maintained our drug-eluting stent leadership position and experienced significant growth in international TAXUS® stent system sales,” said Jim Tobin, President and Chief Executive Officer of Boston Scientific. “In addition, we were encouraged by the enthusiastic physician response to our next-generation TAXUS® Liberté™ stent system, which we recently
 
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Boston Scientific Corporation/Page 2
October 14, 2005
 
launched in Europe. Overall, we were pleased with the solid growth in most of our businesses, with the exception of U.S. drug-eluting stent sales.”
 
The Company plans to communicate guidance for 2006 in January.
 
 
Boston Scientific officials will be discussing these and other issues with analysts on a conference call at 9:00 a.m. (ET) Friday, October 14. The Company will webcast the call to all interested parties through its website: www.bostonscientific.com. Please see the website for details on how to access the webcast. The webcast will be available for one year on the Boston Scientific website.
 
 
Boston Scientific is a worldwide developer, manufacturer and marketer of medical devices whose products are used in a broad range of interventional medical specialties. For more information, please visit: www.bostonscientific.com.
 
 
The Company discloses non-GAAP or pro forma measures that exclude certain charges. Non-GAAP measures may exclude such items as charges related to purchased in-process research and development and certain litigation. Management uses these measures to establish operational goals, and believes that non-GAAP measures may assist investors in analyzing the underlying trends in the Company’s business over time. Investors should consider these non-GAAP measures in addition to, not as a substitute for, or as superior to, financial reporting measures prepared in accordance with GAAP.
 
 
This press release contains forward-looking statements. The Company wishes to caution the reader of this press release that actual results may differ from those discussed in the forward-looking statements and may be adversely affected by, among other things, risks associated with new product development and introduction, clinical trials, regulatory approvals, competitive offerings, intellectual property, litigation, the Company’s overall business strategy, and other factors described in the Company’s filings with the Securities and Exchange Commission.
 

 

 
CONTACT:
Milan Kofol
 
508-650-8569
 
Investor Relations
 
Boston Scientific Corporation
   
 
Paul Donovan
 
508-650-8541
 
Media Relations
 
Boston Scientific Corporation
 
BOSTON SCIENTIFIC CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) 
   
Three Months Ended
September 30, 2005 
  
Three Months Ended
September 30, 2004
  
                           
In millions, except per share data 
  
Reported 
  
Adjustments 
  
Adjusted 
  
Reported 
  
Adjustments 
  
Adjusted 
  
                           
Net sales
  
$
1,511
        
$
1,511
  
$
1,482
        
$
1,482
  
Cost of products sold
    
343
         
343
   
309
         
309
 
Gross profit
    
1,168
         
1,168
   
1,173
         
1,173
 
                                       
Selling, general and administrative expenses
    
444
 
$
(11
)
  
433
   
504
 
$
(110
)
  
394
 
Research and development expenses
    
181
   
(7
)
  
174
   
145
         
145
 
Royalty expense
    
52
         
52
   
57
         
57
 
Amortization expense
    
47
   
(10
)
  
37
   
34
         
34
 
Litigation-related charges
   
780
   
(780
)
        
75
   
(75
)
      
     
1,504
   
(808
)
  
696
   
815
   
(185
)
  
630
 
Operating (loss)/income
   
(336
)
  
808
   
472
   
358
   
185
   
543
 
                                       
Other income (expense):
                                      
Interest expense
    
(21
)
        
(21
)
  
(19
)
        
(19
)
Other, net
    
5
         
5
   
9
         
9
 
                                       
(Loss)/income before income taxes
    
(352
)
  
808
   
456
   
348
   
185
   
533
 
Income taxes
    
(83
)
  
192
   
109
   
90
   
39
   
129
 
                                       
Net (loss)/income
 
$
(269
)
$
616
  
$
347
  
$
258
  
$
146
  
$
404
  
                                       
                                       
Net (loss)/income per common share - assuming dilution
  
$
(0.33
)
      
$
0.42
  
$
0.30
        
$
0.47
  
                                       
Weighted average shares outstanding - assuming dilution
   
819.9
         
830.8
   
861.0
         
861.0
 
                                       
 
 
   
Nine Months Ended
September 30, 2005
  
Nine Months Ended
September 30, 2004
  
                           
In millions, except per share data 
  
Reported
  
Adjustment
  
Adjusted
  
Reported
  
Adjustments
  
Adjusted 
  
                           
Net sales
  
$
4,743
        
$
4,743
  
$
4,024
        
$
4,024
  
Cost of products sold
    
1,044
         
1,044
   
964
         
964
 
Gross profit
    
3,699
         
3,699
   
3,060
         
3,060
 
                                       
Selling, general and administrative expenses
    
1,346
 
$
(28
)
  
1,318
   
1,227
 
$
(110
)
  
1,117
 
Research and development expenses
    
506
   
(7
)
  
499
   
411
         
411
 
Royalty expense
    
174
         
174
   
131
         
131
 
Amortization expense
    
114
   
(10
)
  
104
   
82
         
82
 
Purchased research and development
    
276
   
(276
)
        
64
   
(64
)
      
Litigation-related charges
   
780
   
(780
)
        
75
   
(75
)
      
     
3,196
   
(1,101
)
  
2,095
   
1,990
   
(249
)
  
1,741
 
Operating income
   
503
   
1,101
   
1,604
   
1,070
   
249
   
1,319
 
                                       
Other income (expense):
                                      
Interest expense
    
(58
)
        
(58
)
  
(44
)
        
(44
)
Other, net
    
8
         
8
   
9
         
9
 
                                       
Income before income taxes
    
453
   
1,101
   
1,554
   
1,035
   
249
   
1,284
 
Income taxes
    
159
   
213
   
372
   
270
   
39
   
309
 
                                       
Net income
 
$
294
  
$
888
  
$
1,182
  
$
765
  
$
210
  
$
975
  
                                       
                                       
Net income per common share - assuming dilution
  
$
0.35
        
$
1.41
  
$
0.89
        
$
1.14
  
                                       
Weighted average shares outstanding - assuming dilution
   
840.3
         
840.3
   
858.7
         
858.7
 
                                       
 
 
BOSTON SCIENTIFIC CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) 
   
September 30,
  
December 31,
  
In millions
  
2005
  
2004
  
           
Assets
          
Current assets:
          
Cash, cash equivalents and short-term investments
  
$
917
  
$
1,640
  
Trade accounts receivable, net
    
951
   
900
 
Inventories
    
428
   
360
 
Other current assets
    
465
   
389
 
Total current assets
    
2,761
   
3,289
 
               
Property, plant and equipment, net
    
986
   
870
 
Intangible assets, net
    
3,532
   
3,340
 
Investments
    
581
   
529
 
Other assets
    
216
   
142
 
   
$
8,076
  
$
8,170
  
               
Liabilities and Stockholders’ Equity
              
Current liabilities:
              
Borrowings due within one year
  
$
84
  
$
1,228
  
Accounts payable and accrued expenses
    
981
   
1,010
 
Other current liabilities
    
77
   
367
 
Total current liabilities
    
1,142
   
2,605
 
               
Long-term debt
    
2,430
   
1,139
 
Other long-term liabilities
    
603
   
401
 
               
Stockholders’ equity
    
3,901
   
4,025
 
   
$
8,076
  
$
8,170
  
               
 
 
 
BOSTON SCIENTIFIC CORPORATION
WORLDWIDE SALES
REGIONAL SUMMARY
(Unaudited) 
   
Three Months Ended
          
   
September 30,
  
Change
  
           
As Reported
  
Constant
  
In millions
  
2005
  
2004
  
Currency Basis
  
Currency Basis
  
                   
DOMESTIC
  
$
926
  
$
979
    
-5
%
  
-5
%
                           
                           
                           
EUROPE
    
274
   
236
   
16
%
  
17
%
JAPAN
    
140
   
144
   
-3
%
  
-1
%
INTER-CONTINENTAL
    
171
   
123
   
39
%
  
30
%
INTERNATIONAL
    
585
   
503
   
16
%
  
15
%
                           
WORLDWIDE
  
$
1,511
  
$
1,482
    
2
%
  
1
%
                           
 
                          
 
    
Nine Months Ended
September 30,
    
Change
  
 
                
As Reported 
    
Constant
  
In millions
    
2005
    
2004
    
Currency Basis
    
Currency Basis
  
                           
DOMESTIC
  
$
2,924
  
$
2,499
    
17
%
  
17
%
                           
                           
                           
EUROPE
    
871
   
707
   
23
%
  
20
%
JAPAN
    
440
   
456
   
-4
%
  
-5
%
INTER-CONTINENTAL
    
508
   
362
   
40
%
  
32
%
INTERNATIONAL
    
1,819
   
1,525
   
19
%
  
15
%
                           
WORLDWIDE
  
$
4,743
  
$
4,024
    
18
%
  
16
%
 
 
 
BOSTON SCIENTIFIC CORPORATION
WORLDWIDE SALES
DIVISIONAL SUMMARY
(Unaudited) 
   
Three Months Ended
        
   
September 30,
Change
  
           
As Reported
  
Constant
  
In millions
  
2005
  
2004
  
Currency Basis
  
Currency Basis
  
                   
Cardiovascular
  
$
1,068
  
$
1,107
    
-4
%
  
-4
%
Electrophysiology
    
32
   
32
   
0
%
  
0
%
Neurovascular
    
67
   
60
   
12
%
  
12
%
CARDIOVASCULAR
    
1,167
   
1,199
   
-3
%
  
-3
%
                           
Oncology
    
52
   
46
   
13
%
  
15
%
Endoscopy
    
172
   
157
   
10
%
  
9
%
Urology
    
85
   
66
   
29
%
  
28
%
ENDOSURGERY
    
309
   
269
   
15
%
  
15
%
                           
Neuromodulation
    
35
   
14
   
150
%
  
155
%
                           
WORLDWIDE
  
$
1,511
  
$
1,482
    
2
%
  
1
%
                           
 
                          
 
    
Nine Months Ended
September 30, 
    
Change
  
 
                
As Reported
    
Constant
  
In millions
    
2005
    
2004
    
Currency Basis
    
Currency Basis
  
                           
Cardiovascular
  
$
3,428
  
$
2,922
    
17
%
  
16
%
Electrophysiology
    
97
   
95
   
2
%
  
1
%
Neurovascular
    
206
   
186
   
11
%
  
8
%
CARDIOVASCULAR
    
3,731
   
3,203
   
16
%
  
15
%
                           
Oncology
    
154
   
137
   
12
%
  
11
%
Endoscopy
    
519
   
474
   
9
%
  
8
%
Urology
    
238
   
189
   
26
%
  
25
%
ENDOSURGERY
    
911
   
800
   
14
%
  
13
%
                           
Neuromodulation
    
101
   
21
   
381
%
  
376
%
                           
WORLDWIDE
  
$
4,743
  
$
4,024
    
18
%
  
16
%