Boston Scientific To Eliminate Up To 1,400 Jobs

By Galen Moore, Boston Business Journal

BOSTON (CBS) – With sales and earnings on the upswing, Boston Scientific on Thursday announced a restructuring program that will eliminate 1,200 to 1,400 jobs worldwide in the coming two years – even as it plans a $150 million, five-year China expansion and a $1 billion stock buyback program.

Investors reacted positively, sending shares in the Natick-based medical device maker up by 6.7 percent in early-morning, pre-market trading.

Lisa van der Pool of the Boston Business Journal reports

In a news release that also announced its positive quarterly earnings report, the company sketched its plan to eliminate as many as 1,400 positions through attrition and “targeted head count reductions.”

Plans related to specific regions and business lines are yet to be developed, the release noted.

The cuts will represent up to 5.6 percent of Boston Scientific’s current head count, which stood at 25,000 as of Dec. 31, 2010.

Boston Scientific estimates the program will reduce annual pre-tax operating expenses by about $225 million to $275 million by the end of 2013.

Some of that savings will be redirected to growth-oriented initiatives, the company said.

CEO Ray Elliott, who in May announced his pending retirement , said in a statement that the China expansion, restructuring and share buyback programs are all “key steps on the path to achieving our goals.”

Earlier this month, the Boston Business Journal ranked Elliott one of the most overpaid CEO’s in Boston.

As the Boston Business Journal reported, Boston Scientific reported net sales for the second quarter of $1.98 billion, compared to $1.93 billion a year ago, an increase of 2 percent, and revised its adjusted earnings outlook upward from previous guidance of $0.58 to $0.68 per share to an estimated range of $0.64 to $0.70 per share.

The company has also announced it will invest $150 million in China over five years , building a factory on the ground there, in an effort to take a share of that country’s health care market.

  • slickj

    build a plant in china? Have to sell my shares of boston scinetific. just what the country needs more chinese junk!

    • kelley king

      I couldn’t agree more!

  • swaneebird

    and just who do we have to blame for lack of jobs in this country?

  • kelley king

    I blame NAFTA. When NAFTA was signed, it opened the floodgates for companies to haul ass to China and other foreign countries, which they did. That is when you saw mass closings of factories.

    Instead of creating “new” jobs, I wish we would bring back the old ones. A large portion of the people who are on unemployment are those who have lost their manufacturing jobs. We need these jobs back, both for the sake of jobs in this country as well as getting quality products and goods made here.

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