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By Shivani Singh and Saumya Joseph
July 24 (Reuters) - Boston Scientific Corp narrowly beat Wall Street estimates for quarterly profit on Wednesday, helped by higher sales of its surgical products used to treat urological and pelvic conditions.
However, the results failed to meet “outsized” investor expectations, sending the company’s shares down as much as 3% in early trading.
“Expectations were for higher than 6.3% organic growth – solid results, but did not meet high expectations,” Cowen and Co analyst Joshua Jennings said.
Revenue at the company’s fast-growing MedSurg unit that makes devices to treat conditions such as kidney stones and erectile dysfunction rose to $818 million and beat estimates of $809.7 million, according to IBES data from Refinitiv.
However, revenue from its top-earning cardiovascular unit, which makes heart valves and stents, was in line with analysts’ estimates of $1.03 billion.
Earlier this year, the U.S. Food and Drug Administration had raised safety concerns about balloons and stents coated with a paclitaxel drug used to treat peripheral arterial disease, including Boston Scientific’s Eluvia system.
The FDA is expected to announce its recommendations on the use of the devices over the next few weeks and a positive commentary would boost sales of Eluvia, which the company has called its “growth driver”.
In an attempt to diversify its portfolio, the company has been pursuing several tuck-in acquisitions and buyouts, including its over $4 billion deal for Britain’s BTG Plc, maker of products such as tumor-targeting beads. The company expects the BTG deal to be completed next month.
“Our pace of acquisitions certainly slowed down... We do have capacity to do a couple of more tuck-in oriented acquisitions in 2019 if we wanted to,” Chief Executive Officer Michael Mahoney said on a post-earnings call.
Net income fell 72.3% to $154 million in the second quarter ended June 30. Excluding items, it earned 39 cents per share, just a cent above the consensus estimate.
Net sales rose to $2.63 billion but narrowly missed estimates of $2.64 billion.
Shares of the company were trading down 0.7% at $42.58. (Reporting by Shivani Singh and Saumya Sibi Joseph in Bengaluru; Editing by Shinjini Ganguli and Arun Koyyur)