Boston Scientific Announces Job Cuts, Stock Buyback, Lower Earnings
Boston Scientific (NYSE: BSX) announced today that it plans to cut as many as 1,000 jobs this year, on top of the 1,250 to 1,400 job cuts it announced in 2011, as the troubled medical device maker continues to try and turn its fortunes around.
The Natick, MA-based company also said it will buy back $1 billion of its shares. The company already bought back 1.8 million shares under a 2011 buyback plan. The announcements were included in the company’s lackluster year-end financial results: fourth quarter earnings dropped 44 percent to $60 million, or 4 cents a share, in part because of restructuring charges, while revenues slipped one percent to $1.82 billion.
Boston Scientific currently has about 24,000 employees worldwide.
CEO Michael Mahoney, who took over the top spot in November, said in the press release that “I am confident we are taking the critical steps that are needed to return our company to long term growth.” He projected that revenue will reach $7.05 billion to $7.35 billion for 2013, compared with $7.25 billion last year.
Boston Scientific has been trying to diversify its business through a buying binge, and has purchased some 15 companies in the last five years. The most recent, in November, was Vessix Vascular, a privately held company in Laguna Beach, CA, that makes a device to treat drug-resistant hypertension.