MARLBOROUGH, Mass.,
July 24, 2019 /PRNewswire/ -- Boston Scientific Corporation
(NYSE: BSX) generated sales of $2.631
billion during the second quarter of 2019. This represents
growth of 5.6 percent on a reported basis, 8.0 percent on an
operational1 basis and 6.3 percent on an
organic2 basis, all compared to the prior year period.
The company reported GAAP earnings of $154
million or $0.11 per share
(EPS), compared to GAAP earnings of $555
million or $0.40 per share a
year ago, and achieved adjusted earnings per share of $0.39 for the period, compared to $0.41 a year ago.
"The consistent execution of our global teams continues to
help us grow the majority of our businesses faster than the market
while delivering adjusted EPS at the high end of guidance,"
said Mike Mahoney, chairman and chief executive officer,
Boston Scientific. "As highlighted at our Investor Day last month,
we are excited for our long-term outlook and our robust pipeline of
unique innovations to address unmet patient needs."
Second quarter financial results and recent
developments:
- Reported second quarter sales of $2.631
billion, representing an increase of 5.6 percent on a
reported basis, compared to the company's guidance range of 5 to 7
percent; 8.0 percent on an operational basis; and 6.3 percent on an
organic basis, compared to the company's guidance range of 6 to 7
percent, all compared to the prior year period.
- Reported GAAP earnings of $0.11
per share compared to the company's guidance range of $0.23 to $0.25 per
share, due to acquisition-related charges in the quarter primarily
associated with the proposed acquisition of BTG plc. Achieved
adjusted earnings per share of $0.39
compared to the guidance range of $0.37 to $0.39 per
share.
- Achieved second quarter revenue growth in all segments,
compared to the prior year period:
-
- MedSurg: 9.0 percent reported, 10.9 percent operational and 7.4
percent organic
- Rhythm and Neuro: 1.4 percent reported, 3.3 percent operational
and 2.8 percent organic
- Cardiovascular: 6.3 percent reported, 9.2 percent operational
and 8.1 percent organic
- Reported second quarter revenue growth in all regions, compared
to the prior year period:
-
- U.S.: 6.0 percent reported and operational
- EMEA (Europe, Middle East and Africa): 2.3 percent reported and 8.3 percent
operational
- APAC (Asia-Pacific): 8.9
percent reported and 13.2 percent operational
- Emerging Markets3: 12.3 percent reported and 20.0
percent operational
- Initiated randomized study assessing the safety and
effectiveness of the ACURATE neo2™ Aortic Valve
System in intermediate, high and extreme-risk patients indicated
for transcatheter aortic valve replacement (TAVR). The results of
this trial are expected to serve as the basis of the company's
premarket approval submission to the U.S. Food and Drug
Administration (FDA).
- Began the global OPTION trial, a study of patients with
non-valvular atrial fibrillation who undergo a cardiac ablation
procedure, to compare the safety and effectiveness of the
next-generation WATCHMAN FLX™ Left Atrial Appendage
Closure (LAAC) Device to first-line oral anticoagulants for stroke
risk reduction.
- Announced and closed the acquisition of Vertiflex, Inc., a
privately-held company that developed and commercialized the
Superion® Indirect Decompression
System, a minimally-invasive device used to improve physical
function and reduce pain in patients with lumbar spinal
stenosis.
- Presented two-year results from the INTREPID randomized
controlled trial at the 18th Meeting of the World
Society for Stereotactic and Functional Neurosurgery. Data
demonstrated the safety and effectiveness of the Vercise™
Deep Brain Stimulation (DBS) System for the treatment of patients
with Parkinson's disease symptoms.
- Presented real world data at the International Neuromodulation
Society World Congress from 420 chronic pain patients using the
Spectra WaveWriter™ Spinal Cord Stimulation (SCS) System.
Results showed two-thirds of patients reported a pain score of two
or less at last follow-up, as measured on the zero to 10 numeric
rating scale.
- Announced acute results from the UNTOUCHED study of the
EMBLEM™ Subcutaneous Implantable Defibrillator (S-ICD)
System for primary prevention of sudden cardiac death specifically
in patients with a left ventricular ejection fraction (LVEF) ≤35
percent, the most common population to be indicated for ICD
therapy.4,5 Data presented at the Heart Rhythm Society's
40th Annual Scientific Sessions demonstrated S-ICD therapy had a
complication-free rate of 95.8 percent at 30 days post-procedure
and high conversion efficacy (99.2 percent) of induced ventricular
fibrillation, rates comparable to those seen in previous S-ICD and
transvenous implantable cardioverter-defibrillator (TV-ICD)
studies.
- Commenced controlled launch in the U.S. and Europe of the LOTUS Edge™ Aortic
Valve System, a minimally invasive TAVR technology for patients
with severe aortic stenosis considered to be at high risk for
surgical valve replacement via open heart surgery.
- Received approval from the United
Kingdom's National Health Service for inclusion of the
SpaceOAR™ Hydrogel in its Innovation and Technology Payment
program, expanding treatment access to men undergoing radiotherapy
for prostate cancer.
- Received FDA clearance for the Tactra™ Next-Generation
Malleable Penile Prosthesis, the first and only penile implant for
men with erectile dysfunction to include a nitinol core to optimize
rigidity, durability and concealment.
- Received FDA approval and launched in the U.S. the VICI
VENOUS STENT™ System for the treatment of iliofemoral venous
obstructive disease.
- Announced the divestiture of the existing Boston Scientific
drug-eluting and bland embolic microsphere portfolio to Varian
Medical Systems for an upfront cash payment of $90 million, subject to the successful completion
of the company's proposed acquisition of BTG plc.
1. Operational
revenue growth excludes the impact of foreign currency
fluctuations.
|
2. Organic
revenue growth excludes the impact of foreign currency fluctuations
and sales from the recent acquisitions of NxThera, Inc. (NxThera),
Claret Medical, Inc. (Claret), Augmenix, Inc. (Augmenix) and
Vertiflex, Inc. (Vertiflex), each with no prior year comparable
sales.
|
3. We define
Emerging Markets as the 20 countries that we believe
have strong growth potential based on their economic conditions,
healthcare sectors and our global capabilities. Periodically, we
assess our list of Emerging Markets; effective January 1, 2019, we
updated our list of Emerging Market countries. We have revised
prior year amounts to the current year's presentation (as denoted
with † throughout). The revision had an immaterial impact on prior
year Emerging Markets sales.
|
4. Friedman, DJ,
Parzynski, CS, Varosy, PD, et al., Trends and In-Hospital Outcomes
Associated With Adoption of the Subcutaneous Implantable
Cardioverter Defibrillator in the United States. JAMA Cardiol,
2016. 1(8): p. 900-911.
|
5. Haugaa, KH,
Tilz, R, Boveda, S, et al., Implantable cardioverter defibrillator
use for primary prevention in ischaemic and non-ischaemic heart
disease-indications in the post-DANISH trial era: results of the
European Heart Rhythm Association survey. Europace, 2017.
19(4): p. 660-664.
|
Net sales for the second quarter by business and
region:
|
|
|
|
|
Change
|
|
|
Three Months
Ended
June 30,
|
|
Reported
Basis
|
|
Less: Impact
of Foreign
Currency
Fluctuations
|
|
Operational
Basis
|
|
Less:
Impact of
Recent
Acquisitions
|
|
Organic
Basis
|
(in
millions)
|
2019
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Endoscopy
|
$
|
470
|
|
$
|
442
|
|
|
6.3%
|
|
(2.1)%
|
|
8.4%
|
|
—%
|
|
8.4%
|
|
Urology
and Pelvic Health
|
348
|
|
308
|
|
|
13.0%
|
|
(1.6)%
|
|
14.6%
|
|
8.5%
|
|
6.1%
|
|
MedSurg
|
818
|
|
751
|
|
|
9.0%
|
|
(1.9)%
|
|
10.9%
|
|
3.5%
|
|
7.4%
|
|
Cardiac
Rhythm Management
|
498
|
|
494
|
|
|
0.6%
|
|
(2.2)%
|
|
2.8%
|
|
—%
|
|
2.8%
|
|
Electrophysiology
|
84
|
|
79
|
|
|
7.0%
|
|
(2.5)%
|
|
9.5%
|
|
—%
|
|
9.5%
|
|
Neuromodulation
|
204
|
|
202
|
|
|
1.0%
|
|
(1.2)%
|
|
2.2%
|
|
2.1%
|
|
0.1%
|
|
Rhythm and
Neuro
|
786
|
|
775
|
|
|
1.4%
|
|
(1.9)%
|
|
3.3%
|
|
0.5%
|
|
2.8%
|
|
Interventional Cardiology
|
706
|
|
662
|
|
|
6.7%
|
|
(3.0)%
|
|
9.7%
|
|
1.6%
|
|
8.1%
|
|
Peripheral Interventions
|
320
|
|
304
|
|
|
5.6%
|
|
(2.6)%
|
|
8.2%
|
|
—%
|
|
8.2%
|
|
Cardiovascular
|
1,026
|
|
965
|
|
|
6.3%
|
|
(2.9)%
|
|
9.2%
|
|
1.1%
|
|
8.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Sales
|
$
|
2,631
|
|
$
|
2,490
|
|
|
5.6%
|
|
(2.4)%
|
|
8.0%
|
|
1.7%
|
|
6.3%
|
|
|
|
|
|
Change
|
|
|
Three Months
Ended
June 30,
|
|
Reported
Basis
|
|
Less: Impact
of Foreign
Currency
Fluctuations
|
|
Operational
Basis
|
(in
millions)
|
2019
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S.
|
$
|
1,478
|
|
$
|
1,394
|
|
|
6.0%
|
|
—%
|
|
6.0%
|
|
EMEA
|
571
|
|
558
|
|
|
2.3%
|
|
(6.0)%
|
|
8.3%
|
|
APAC
|
481
|
|
442
|
|
|
8.9%
|
|
(4.3)%
|
|
13.2%
|
|
Latin America and
Canada
|
101
|
|
96
|
|
|
4.5%
|
|
(4.8)%
|
|
9.3%
|
|
|
|
|
|
|
|
|
|
|
|
Net
Sales
|
$
|
2,631
|
|
$
|
2,490
|
|
|
5.6%
|
|
(2.4)%
|
|
8.0%
|
|
|
|
|
|
|
|
|
|
|
|
Emerging
Markets†
|
$
|
318
|
|
$
|
283
|
|
|
12.3%
|
|
(7.7)%
|
|
20.0%
|
|
|
|
|
|
|
|
|
|
|
|
Amounts may not
add due to rounding. Growth rates are based on actual, non-rounded
amounts and may not recalculate precisely.
|
|
|
|
Sales growth rates
that exclude the impact of foreign currency fluctuations and/or the
impact of recent aforementioned acquisitions
are not prepared in accordance with U.S. GAAP.
|
Guidance for Full Year and Third Quarter 2019
The company estimates revenue growth for the full year 2019,
versus the prior year period, to be in a range of approximately 7
to 8 percent on a reported basis (consistent with prior guidance),
and a growth range of approximately 7 to 8 percent on an organic
basis (consistent with prior guidance). Full year organic guidance
excludes the impact of foreign currency fluctuations and
contribution of approximately 140 basis points from the
acquisitions of NxThera, Claret, Augmenix and Vertiflex, each with
no prior period related net sales. The company now estimates income
on a GAAP basis in a range of $0.94
to $0.98 per share (compared to prior
guidance of $1.09 to $1.13 per share) and estimates adjusted earnings,
excluding certain charges (credits), in a range of $1.54 to $1.58 per
share (consistent with prior guidance).
The company estimates revenue growth for the third quarter of
2019, versus the prior year period, to be in a range of
approximately 8 to 10 percent on a reported basis and a growth
range of approximately 7.5 to 9 percent on an organic basis. Third
quarter organic guidance excludes the impact of foreign currency
fluctuations and contribution of approximately 180 basis points
from the acquisitions of Claret, Augmenix and Vertiflex, each with
no prior period related net sales. The company estimates earnings
on a GAAP basis in a range of $0.23
to $0.25 per share and adjusted
earnings, excluding certain charges (credits), in a range of
$0.37 to $0.39 per share.
Conference Call Information
Boston Scientific management will be discussing these results
with analysts on a conference call today at 8:00 a.m. EDT. The company will webcast the call
to 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
approximately one year on the Boston Scientific website.
About Boston Scientific
Boston Scientific transforms
lives through innovative medical solutions that improve the health
of patients around the world. As a global medical technology
leader for 40 years, we advance science for life by providing a
broad range of high performance solutions that address unmet
patient needs and reduce the cost of healthcare. For more
information, visit www.bostonscientific.com and connect on Twitter
and Facebook.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of
1934. Forward-looking statements may be identified by words
like "anticipate," "expect," "project," "believe," "plan,"
"estimate," "intend," "aiming" and similar words. These
forward-looking statements are based on our beliefs, assumptions
and estimates using information available to us at the time and are
not intended to be guarantees of future events or
performance. These forward-looking statements include, among
other things, statements regarding our expected net sales, GAAP,
operational and organic revenue growth rates, GAAP earnings and
adjusted earnings for the third quarter and full year 2019, our
financial performance, our business plans and our positioning for
revenue and earnings growth. If our underlying assumptions
turn out to be incorrect, or if certain risks or uncertainties
materialize, actual results could vary materially from the
expectations and projections expressed or implied by our
forward-looking statements. These risks and uncertainties, in
some cases, have affected and in the future could affect our
ability to implement our business strategy and may cause actual
results to differ materially from those contemplated by the
statements expressed in this press release. As a result,
readers are cautioned not to place undue reliance on any of our
forward-looking statements.
Risks and uncertainties that may cause such differences include,
among other things: future economic, political, competitive,
reimbursement and regulatory conditions, new product introductions
and the market acceptance of those products, markets for our
products, expected pricing environment, expected procedural
volumes, the closing and integration of acquisitions, clinical
trial results, demographic trends, intellectual property rights,
litigation, financial market conditions, the execution and effect
of our restructuring program, the execution and effect of our
business strategy, including our cost-savings and growth
initiatives and future business decisions made by us and our
competitors. New risks and uncertainties may arise from time
to time and are difficult to predict. All of these factors are
difficult or impossible to predict accurately and many of them are
beyond our control. For a further list and description of
these and other important risks and uncertainties that may affect
our future operations, see Part I, Item IA - Risk
Factors in our most recent Annual Report on Form 10-K filed
with the Securities and Exchange Commission, which we may update in
Part II, Item 1A - Risk Factors in Quarterly Reports on
Form 10-Q we have filed or will file hereafter. We disclaim
any intention or obligation to publicly update or revise any
forward-looking statement to reflect any change in our expectations
or in events, conditions, or circumstances on which those
expectations may be based, or that may affect the likelihood that
actual results will differ from those contained in the
forward-looking statements. This cautionary statement is
applicable to all forward-looking statements contained in this
press release.
Note: Amounts reported in millions within this press
release are computed based on the amounts in thousands. As a
result, the sum of the components reported in millions may not
equal the total amount reported in millions due to rounding.
Certain columns and rows within tables may not add due to the use
of rounded numbers. Percentages presented are calculated from the
underlying numbers in dollars.
Use of Non-GAAP Financial Information
A
reconciliation of the company's non-GAAP financial measures to the
corresponding GAAP measures, and an explanation of the company's
use of these non-GAAP financial measures, is included in the
exhibits attached to this press release.
CONTACT:
|
|
|
|
|
|
Media:
|
Katie
Schur
|
|
Investors:
|
Susie Lisa,
CFA
|
|
|
508-683-5574
(office)
|
|
|
508-683-5565
(office)
|
|
|
Media
Relations
|
|
|
Investor
Relations
|
|
|
Boston Scientific
Corporation
|
|
|
Boston Scientific
Corporation
|
|
|
katie.schur@bsci.com
|
|
|
BSXInvestorRelations@bsci.com
|
BOSTON SCIENTIFIC
CORPORATION
CONDENSED
CONSOLIDATED GAAP RESULTS OF OPERATIONS
(Unaudited)
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
in millions,
except per share data
|
2019
|
2018
|
|
2019
|
2018
|
|
|
|
|
|
|
Net sales
|
$
|
2,631
|
|
$
|
2,490
|
|
|
$
|
5,124
|
|
$
|
4,870
|
|
Cost of products
sold
|
758
|
|
739
|
|
|
1,488
|
|
1,411
|
|
Gross
profit
|
1,873
|
|
1,751
|
|
|
3,636
|
|
3,458
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
Selling, general and
administrative expenses
|
968
|
|
886
|
|
|
1,837
|
|
1,746
|
|
Research and
development expenses
|
280
|
|
275
|
|
|
559
|
|
536
|
|
Royalty
expense
|
17
|
|
17
|
|
|
32
|
|
35
|
|
Amortization
expense
|
161
|
|
147
|
|
|
321
|
|
288
|
|
Intangible asset
impairment charges
|
37
|
|
34
|
|
|
105
|
|
35
|
|
Contingent
consideration expense (benefit)
|
10
|
|
(4)
|
|
|
(18)
|
|
1
|
|
Restructuring charges
(credits)
|
1
|
|
5
|
|
|
7
|
|
18
|
|
Litigation-related
net charges (credits)
|
15
|
|
—
|
|
|
(133)
|
|
—
|
|
|
1,489
|
|
1,359
|
|
|
2,711
|
|
2,659
|
|
Operating income
(loss)
|
384
|
|
392
|
|
|
925
|
|
799
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
Interest
expense
|
(89)
|
|
(57)
|
|
|
(198)
|
|
(119)
|
|
Other, net
|
(150)
|
|
12
|
|
|
(125)
|
|
(11)
|
|
Income
(loss) before income taxes
|
145
|
|
347
|
|
|
602
|
|
670
|
|
Income tax expense
(benefit)
|
(9)
|
|
(209)
|
|
|
24
|
|
(183)
|
|
Net income
(loss)
|
$
|
154
|
|
$
|
555
|
|
|
$
|
578
|
|
$
|
853
|
|
|
|
|
|
|
|
Net income (loss)
per common share - basic
|
$
|
0.11
|
|
$
|
0.40
|
|
|
$
|
0.42
|
|
$
|
0.62
|
|
Net income (loss)
per common share - assuming dilution
|
$
|
0.11
|
|
$
|
0.40
|
|
|
$
|
0.41
|
|
$
|
0.61
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding
|
|
|
|
|
|
Basic
|
1,391.0
|
|
1,380.5
|
|
|
1,389.4
|
|
1,378.5
|
|
Assuming
dilution
|
1,408.6
|
|
1,398.9
|
|
|
1,408.5
|
|
1,397.8
|
|
BOSTON SCIENTIFIC
CORPORATION
NON-GAAP NET INCOME
AND NET INCOME PER SHARE RECONCILIATIONS
(Unaudited)
|
|
|
|
Three Months Ended
June 30, 2019
|
(in millions,
except per share data)
|
|
Cost of
Products
Sold
|
|
SG&A
Expenses
|
|
R&D
Expenses
|
|
Operating
Income
(Loss)
|
|
Pre-Tax
Income
(Loss)
|
|
Net
Income
(Loss)
|
|
Impact
per
Share
|
GAAP net income
(loss)
|
|
$
|
758
|
|
|
$
|
968
|
|
|
$
|
280
|
|
|
$
|
384
|
|
|
$
|
145
|
|
|
$
|
154
|
|
|
$
|
0.11
|
|
Non-GAAP
adjustments to net income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization
expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
161
|
|
|
162
|
|
|
144
|
|
|
0.10
|
|
Intangible asset
impairment charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
37
|
|
|
37
|
|
|
35
|
|
|
0.02
|
|
Acquisition-related
net charges (credits)
|
|
(19)
|
|
|
(28)
|
|
|
(7)
|
|
|
64
|
|
|
225
|
|
|
177
|
|
|
0.13
|
|
Restructuring and
restructuring-related net charges (credits)
|
|
(6)
|
|
|
(4)
|
|
|
—
|
|
|
11
|
|
|
11
|
|
|
10
|
|
|
0.01
|
|
Litigation-related
net charges (credits)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
15
|
|
|
12
|
|
|
0.01
|
|
Investment impairment
charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
0.00
|
|
Discrete tax
items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
0.01
|
|
Adjusted net
income
|
|
$
|
734
|
|
|
$
|
936
|
|
|
$
|
273
|
|
|
$
|
672
|
|
|
$
|
596
|
|
|
$
|
550
|
|
|
$
|
0.39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, 2018
|
(in millions,
except per share data)
|
|
Cost of
Products
Sold
|
|
SG&A
Expenses
|
|
R&D
Expenses
|
|
Operating
Income
(Loss)
|
|
Pre-Tax
Income
(Loss)
|
|
Net
Income
(Loss)
|
|
Impact
per
Share
|
GAAP net income
(loss)
|
|
$
|
739
|
|
|
$
|
886
|
|
|
$
|
275
|
|
|
$
|
392
|
|
|
$
|
347
|
|
|
$
|
555
|
|
|
$
|
0.40
|
|
Non-GAAP
adjustments to net income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization
expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
147
|
|
|
147
|
|
|
130
|
|
|
0.09
|
|
Intangible asset
impairment charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34
|
|
|
34
|
|
|
30
|
|
|
0.02
|
|
Acquisition-related
net charges (credits)
|
|
(9)
|
|
|
(27)
|
|
|
(15)
|
|
|
46
|
|
|
5
|
|
|
9
|
|
|
0.01
|
|
Restructuring and
restructuring-related net charges (credits)
|
|
(16)
|
|
|
5
|
|
|
—
|
|
|
15
|
|
|
15
|
|
|
13
|
|
|
0.01
|
|
Discrete tax
items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(168)
|
|
|
(0.12)
|
|
Adjusted net
income
|
|
$
|
715
|
|
|
$
|
865
|
|
|
$
|
260
|
|
|
$
|
633
|
|
|
$
|
547
|
|
|
$
|
568
|
|
|
$
|
0.41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
An explanation of
the company's use of these non-GAAP financial measures is provided
at the end of this document.
|
BOSTON SCIENTIFIC
CORPORATION
NON-GAAP NET INCOME
AND NET INCOME PER SHARE RECONCILIATIONS
(Unaudited)
|
|
|
|
Six Months Ended
June 30, 2019
|
in millions,
except per share data
|
|
Cost of
Products
Sold
|
|
SG&A
Expenses
|
|
R&D
Expenses
|
|
Operating
Income
(Loss)
|
|
Pre-Tax
Income
(Loss)
|
|
Net
Income
(Loss)
|
|
Impact
per
Share
|
GAAP net income
(loss)
|
|
$
|
1,488
|
|
|
$
|
1,837
|
|
|
$
|
559
|
|
|
$
|
925
|
|
|
$
|
602
|
|
|
$
|
578
|
|
|
$
|
0.41
|
|
Non-GAAP
adjustments to net income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization
expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
321
|
|
|
323
|
|
|
287
|
|
|
0.20
|
|
Intangible asset
impairment charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
105
|
|
|
105
|
|
|
97
|
|
|
0.07
|
|
Acquisition-related
net charges (credits)
|
|
(31)
|
|
|
(40)
|
|
|
(15)
|
|
|
69
|
|
|
201
|
|
|
155
|
|
|
0.11
|
|
Restructuring and
restructuring-related net charges (credits)
|
|
(10)
|
|
|
(7)
|
|
|
—
|
|
|
23
|
|
|
23
|
|
|
19
|
|
|
0.01
|
|
Litigation-related
net charges (credits)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(133)
|
|
|
(133)
|
|
|
(116)
|
|
|
(0.08)
|
|
Investment impairment
charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|
0.00
|
|
Discrete tax
items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
0.01
|
|
Adjusted net
income
|
|
$
|
1,447
|
|
|
$
|
1,791
|
|
|
$
|
544
|
|
|
$
|
1,310
|
|
|
$
|
1,123
|
|
|
$
|
1,040
|
|
|
$
|
0.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, 2018
|
in millions,
except per share data
|
|
Cost of
Products
Sold
|
|
SG&A
Expenses
|
|
R&D
Expenses
|
|
Operating
Income
(Loss)
|
|
Pre-Tax
Income
(Loss)
|
|
Net
Income
(Loss)
|
|
Impact
per
Share
|
GAAP net income
(loss)
|
|
$
|
1,411
|
|
|
$
|
1,746
|
|
|
$
|
536
|
|
|
$
|
799
|
|
|
$
|
670
|
|
|
$
|
853
|
|
|
$
|
0.61
|
|
Non-GAAP
adjustments to net income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization
expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
288
|
|
|
288
|
|
|
248
|
|
|
0.18
|
|
Intangible asset
impairment charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35
|
|
|
35
|
|
|
31
|
|
|
0.02
|
|
Acquisition-related
net charges (credits)
|
|
(15)
|
|
|
(33)
|
|
|
(22)
|
|
|
71
|
|
|
30
|
|
|
29
|
|
|
0.02
|
|
Restructuring and
restructuring-related net charges (credits)
|
|
(23)
|
|
|
(3)
|
|
|
—
|
|
|
43
|
|
|
43
|
|
|
35
|
|
|
0.02
|
|
Investment impairment
charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
5
|
|
|
0.00
|
|
Discrete tax
items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(177)
|
|
|
(0.13)
|
|
Adjusted net
income
|
|
$
|
1,374
|
|
|
$
|
1,710
|
|
|
$
|
514
|
|
|
$
|
1,237
|
|
|
$
|
1,071
|
|
|
$
|
1,023
|
|
|
$
|
0.73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
An explanation of
the company's use of these non-GAAP financial measures is provided
at the end of this document.
|
BOSTON SCIENTIFIC
CORPORATION
|
ESTIMATED REVENUE
NON-GAAP GROWTH RATES AND NON-GAAP NET INCOME PER SHARE
RECONCILIATIONS
|
(Unaudited)
|
Q3 and Full Year 2019 Estimated Revenue Growth Rates
|
Q3 2019
Estimate
|
|
Full Year 2019
Estimate
|
|
(Low)
|
(High)
|
|
(Low)
|
(High)
|
Estimated GAAP
sales growth
|
8%
|
10%
|
|
7%
|
8%
|
Less: Estimated
impact of foreign currency fluctuations and the
aforementioned acquisitions
|
0.5%
|
1%
|
|
—%
|
—%
|
Estimated sales
growth, organic*
|
7.5%
|
9%
|
|
7%
|
8%
|
|
|
|
|
|
|
*Q3 2019 Estimate
excludes contribution of approximately 180 basis points from the
aforementioned acquisitions, each with
no prior year comparable sales. Full Year 2019 Estimate excludes
contribution of approximately 140 basis points from the
aforementioned acquisitions, each with no prior year comparable
sales.
|
Q3 and Full Year 2019 Earnings per Share Guidance
|
Q3 2019
Estimate
|
|
Full Year 2019
Estimate
|
|
(Low)
|
(High)
|
|
(Low)
|
(High)
|
GAAP
results
|
$
|
0.23
|
|
$
|
0.25
|
|
|
$
|
0.94
|
|
$
|
0.98
|
|
|
|
|
|
|
|
Estimated
amortization expense
|
0.10
|
|
0.10
|
|
|
0.41
|
|
0.41
|
|
Estimated intangible
asset impairment charges
|
—
|
|
—
|
|
|
0.07
|
|
0.07
|
|
Estimated
acquisition-related net charges (credits)
|
0.02
|
|
0.02
|
|
|
0.14
|
|
0.14
|
|
Estimated
restructuring and restructuring-related net charges
(credits)
|
0.02
|
|
0.02
|
|
|
0.05
|
|
0.05
|
|
Estimated
litigation-related net charges (credits)
|
—
|
|
—
|
|
|
(0.08)
|
|
(0.08)
|
|
Estimated investment
impairment charges
|
—
|
|
—
|
|
|
0.00
|
|
0.00
|
|
Estimated discrete
tax items
|
—
|
|
—
|
|
|
0.01
|
|
0.01
|
|
|
|
|
|
|
|
Adjusted
results
|
$
|
0.37
|
|
$
|
0.39
|
|
|
$
|
1.54
|
|
$
|
1.58
|
|
Prior Guidance Estimate - Q2 2019 and Full Year 2019 Sales
Growth
|
Q2 2019
Estimate
|
|
Prior Full Year
2019
Estimate
|
|
(Low)
|
(High)
|
|
(Low)
|
(High)
|
Estimated GAAP
sales growth
|
5%
|
7%
|
|
7%
|
8%
|
Less: Estimated
impact of foreign currency fluctuations and the
aforementioned acquisitions
|
(1)%
|
—%
|
|
—%
|
—%
|
Estimated sales
growth, organic*
|
6%
|
7%
|
|
7%
|
8%
|
|
|
|
|
|
|
*Q2 2019 Estimate
excluded contribution of approximately 140 basis points from the
aforementioned acquisitions, each with
no prior year comparable sales. Prior Full Year 2019 Estimate
excluded contribution of approximately 110 basis points from
the
aforementioned acquisitions, each with no prior year comparable
sales.
|
Prior Guidance Estimate - Q2 2019 and Full Year 2019 Earnings
per Share
|
Q2 2019
Estimate
|
|
Prior Full Year
2019 Estimate
|
|
(Low)
|
(High)
|
|
(Low)
|
(High)
|
GAAP
results
|
$
|
0.23
|
|
$
|
0.25
|
|
|
$
|
1.09
|
|
$
|
1.13
|
|
|
|
|
|
|
|
Estimated
amortization expense
|
0.10
|
|
0.10
|
|
|
0.41
|
|
0.41
|
|
Estimated intangible
asset impairment charges
|
—
|
|
—
|
|
|
0.04
|
|
0.04
|
|
Estimated
acquisition-related net charges (credits)
|
0.02
|
|
0.02
|
|
|
0.03
|
|
0.03
|
|
Estimated
restructuring and restructuring-related net charges
(credits)
|
0.02
|
|
0.02
|
|
|
0.06
|
|
0.06
|
|
Estimated
litigation-related net charges (credits)
|
—
|
|
—
|
|
|
(0.09)
|
|
(0.09)
|
|
Estimated investment
impairment charges
|
—
|
|
—
|
|
|
0.00
|
|
0.00
|
|
|
|
|
|
|
|
Adjusted
results
|
$
|
0.37
|
|
$
|
0.39
|
|
|
$
|
1.54
|
|
$
|
1.58
|
|
Use of Non-GAAP Financial Measures
To supplement our unaudited condensed consolidated financial
statements presented on a GAAP basis, we disclose certain non-GAAP
financial measures, including adjusted net income (earnings) and
adjusted net income (earnings) per share that exclude certain
amounts, operational net sales, which exclude the impact of foreign
currency fluctuations and organic net sales, which exclude the
impact of foreign currency fluctuations and the impact of recent
aforementioned acquisitions. These non-GAAP financial measures are
not in accordance with generally accepted accounting principles in
the United States and should not
be considered in isolation from or as a replacement for the most
directly comparable GAAP financial measures. Further, other
companies may calculate these non-GAAP financial measures
differently than we do, which may limit the usefulness of those
measures for comparative purposes.
To calculate adjusted net income (earnings) and adjusted net
income (earnings) per share we exclude certain charges (credits)
from GAAP net income. Amounts are presented after-tax at the
Company's effective tax rate, unless the amount is a significant
unusual or infrequently occurring item in accordance with FASB
Accounting Standards Codification section 740-270-30, "General
Methodology and Use of Estimated Annual Effective Tax Rate." Please
refer to Part II, Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations in our most recent
Annual Report filed on Form 10-K filed with the Securities and
Exchange Commission for an explanation of each of these adjustments
and the reasons for excluding each item. The following is an
explanation of each incremental or revised adjustment type that
management excluded as part of these non-GAAP financial measures,
since our most recent Annual Report on Form 10-K, as well as the
reason for excluding each item:
- Acquisition-related net charges (credits) or payments- These
adjustments may consist of (a) contingent consideration fair value
adjustments; (b) gains on previously held investments; (c) due
diligence, deal fees, inventory step-up amortization, integration
and exit costs, other fees, and accelerated compensation expense;
and (d) separation costs and gains primarily associated with the
sale of a business or portion of a business. The contingent
consideration adjustments represent accounting adjustments to state
contingent consideration liabilities at their estimated fair value.
These adjustments can be highly variable depending on the assessed
likelihood and amount of future contingent consideration payments.
Due diligence, deal fees, inventory step-up amortization,
integration and exit costs include legal, tax, severance and other
expenses associated with prior and potential future acquisitions
and divestitures that can be highly variable and not representative
of ongoing operations. Deal fees in 2019 included expenses for
instruments entered into solely for the purpose of financing or
hedging the proposed BTG plc acquisition, including net interest
expense and hedging expenses. Upon the acquisition closing, we
will treat these types of expenses and gains as normal operating
costs. Separation costs and gains/losses on the sale of a
business unit would represent those costs associated with a
divestiture and are not representative of ongoing operations.
Acquisition-related net charges (credits) are excluded from
management's assessment of operating performance and from our
operating segments' measures of profit and loss used for making
operating decisions and assessing performance.
The GAAP financial measures most directly comparable to adjusted
net income and adjusted net income per share are GAAP net income
and GAAP net income per share.
To calculate operational net sales, which exclude the impact of
foreign currency fluctuations, we convert actual net sales from
local currency to U.S. dollars using constant foreign currency
exchange rates in the current and prior period. To calculate
organic net sales, we remove the impact of recent aforementioned
acquisitions with no prior period related net sales from
operational net sales. The GAAP financial measure most directly
comparable to operational net sales and organic net sales is net
sales on a GAAP basis.
Reconciliations of each of these non-GAAP financial measures to
the corresponding GAAP financial measure are included in the
accompanying schedules.
Management uses these supplemental non-GAAP financial measures
to evaluate performance period over period, to analyze the
underlying trends in our business, to assess our performance
relative to our competitors and to establish operational goals and
forecasts that are used in allocating resources. In addition,
management uses these non-GAAP financial measures to further its
understanding of the performance of our operating segments. With
the exception of the impact of the recent aforementioned
acquisitions, the adjustments excluded from our non-GAAP financial
measures are consistent with those excluded from our operating
segments' measures of net sales and profit or loss. These
adjustments are excluded from the segment measures reported to our
chief operating decision maker that are used to make operating
decisions and assess performance.
We believe that presenting adjusted net income and adjusted net
income per share, operational net sales and organic net sales, in
addition to the corresponding GAAP financial measures, provides
investors greater transparency to the information used by
management for its operational decision-making and allows investors
to see our results "through the eyes" of management. We further
believe that providing this information assists our investors in
understanding our operating performance and the methodology used by
management to evaluate and measure such performance.
View original content to download
multimedia:http://www.prnewswire.com/news-releases/boston-scientific-announces-results-for-second-quarter-2019-300889987.html
SOURCE Boston Scientific Corporation