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Boston Scientific Corporation : Boston Scientific Announces Results For Fourth Quarter And Full Year Ended December 31, 2012

01/29/2013 | 07:05am US/Eastern
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NATICK, Mass., Jan. 29, 2013 /PRNewswire/ -- Boston Scientific Corporation (NYSE: BSX) announces financial results for the fourth quarter and full year ended December 31, 2012, as well as sales and earnings per share (EPS) guidance for the first quarter and full year 2013.

Fourth quarter results and recent developments:

    --  Reported sales of $1.821 billion, a year-over-year decline of 1 percent
        on a reported basis and on a constant currency basis excluding divested
        businesses. Delivered GAAP EPS of $0.04 and adjusted EPS of $0.18.
        Generated strong operating cash flow of $370 million.


    --  Achieved revenue growth of 14 percent and earned the clear number two
        share position in the U.S. in Neuromodulation, 10 percent in Endoscopy
        and 9 percent in Peripheral Interventions, all on a constant currency
        basis.


    --  The combined revenue in the countries of Brazil, Russia, India and China
        grew 35 percent in the quarter, on a constant currency basis.


    --  Continued to make progress on strengthening the CRM business with the
        U.S. launch of the S-ICD System, and the completion of the acquisition
        of Rhythmia Medical, Inc., a developer of a next-generation mapping and
        navigation solution for use in electrophysiology procedures.


    --  Increased DES revenue 6 percent internationally on a constant currency
        basis and maintained sequential share in the U.S., despite the
        year-over-year sales decline.


    --  Completed the acquisition of Vessix Vascular, Inc., a developer of a
        next generation catheter-based renal denervation system for the
        treatment of uncontrolled hypertension.


    --  Repurchased approximately 18 million shares under the 2011 share
        repurchase authorization.  Separately, the company announces the
        authorization of a new program to repurchase up to $1 billion of the
        company's common stock.
    --  Approved an expansion of the company's 2011 restructuring program, which
        is expected to reduce gross annual pre-tax operating expenses by an
        incremental $100 million to $115 million exiting 2013.

"We are pleased but not satisfied with our improved performance in the quarter," said Mike Mahoney, president and chief executive officer, Boston Scientific. "We continued to enhance our growth portfolio, expand in the emerging markets, and implement operational changes to improve our execution and sharpen our customer focus. I am confident we are taking the critical steps that are needed to return our company to long-term growth."

Fourth Quarter 2012

Sales for the fourth quarter of 2012 were $1.821 billion, as compared to sales of $1.848 billion for the fourth quarter of 2011, a decrease of 1 percent. Excluding the impact of foreign currency and sales from divested businesses, sales declined 1 percent as compared to the prior period.

Worldwide sales for the fourth quarter - on a constant currency and as reported basis - were as follows:

                                                                            Change
                                                                            ------
                                 Three Months
                                                   Ended         As Reported           Constant
                                                December 31,        Currency            Currency
                                       ------------
    in millions                            2012            2011        Basis       Basis
    -----------                            ----            ----        -----       -----

                 Interventional Cardiology                 $534   $594       (10)%         (9)%

                 Cardiac Rhythm Management                  457    482        (5)%         (4)%

                 Endoscopy                                  329    304         8 %         10 %

                 Peripheral Interventions                   199    184         8 %          9 %

                 Urology/Women's Health                     130    127         2 %          3 %

                 Neuromodulation                            104     91        14 %         14 %

                 Electrophysiology                           38     36         4 %          5 %
                                                            ---    ---

    Subtotal Core Businesses                              1,791  1,818        (1)%         (1)%

                 Divested Businesses                         30     30        N/A          N/A

    Worldwide                                            $1,821 $1,848        (1)%       -   %
                                                         ====== ======        ===         ====

Growth rates are based on actual, non-rounded amounts and may not recalculate precisely.

On a GAAP basis, net income for the fourth quarter of 2012 was $60 million, or $0.04 per share. These results included divestiture-related net credits, acquisition, restructuring- and litigation-related charges, and amortization expense, of $192 million (after-tax) or $0.14 per share. Adjusted net income for the fourth quarter of 2012, excluding these net charges, was $252 million, or $0.18 per share.

On a GAAP basis, net income for the fourth quarter of 2011 was $107 million, or $0.07 per share. These results included acquisition- and divestiture-related net credits, litigation-, and restructuring-related charges, discrete tax items and amortization expense, of $90 million (after-tax) or $0.06 per share. Adjusted net income for the fourth quarter of 2011, excluding these net charges, was $197 million, or $0.13 per share.

Full Year 2012

Sales for the full year 2012 were $7.249 billion, as compared to sales of $7.622 billion for the full year 2011, a decrease of 5 percent. Excluding the impact of foreign currency and sales from divested businesses, sales decreased 3 percent as compared to the prior period.

Worldwide sales for the full year - on a constant currency and as reported basis - were as follows:

                                                                                              Change
                                                                                              ------
                                          Year Ended       As Reported       Constant
                                         December 31,        Currency        Currency
                                    ------------
    in millions                                       2012 2011        Basis           Basis
    -----------                                       ---- ----        -----           -----

                 Interventional Cardiology                      $2,179         $2,495                (13)%      (11)%

                 Cardiac Rhythm Management                       1,908   2,087            (9)%             (7)%

                 Endoscopy                                       1,252   1,187              5%               7%

                 Peripheral Interventions                          774     731              6%               8%

                 Urology/Women's Health                     500    498              - %                 1%

                 Neuromodulation                                   367     336              9%               9%

                 Electrophysiology                          147    147              - %                 1%
                 -----------                                ---                       ---

    Subtotal Core Businesses                                     7,127   7,481            (5)%             (3)%

                 Divested Businesses                        122    141            N/A                 N/A

    Worldwide                                                   $7,249         $7,622                 (5)%       (3)%
                                                                ======         ======                 ===        ===

Growth rates are based on actual, non-rounded amounts and may not recalculate precisely.

On a GAAP basis, net loss for the full year 2012 was $4.068 billion, or $2.89 per share. Reported results included goodwill and other intangible asset impairment charges, acquisition- and divestiture-related net credits, restructuring- and litigation-related charges, discrete tax items and amortization expense (after-tax) of $5.001 billion, or $3.55 per share. Adjusted net income for the full year 2012, excluding these net charges, was $933 million, or $0.66 per share.

On a GAAP basis, net income for the full year 2011 was $441 million, or $0.29 per share. Reported results included goodwill and intangible asset impairment charges; acquisition- and divestiture-related net credits; litigation- and restructuring-related charges; discrete tax items and amortization expense (after-tax) of $577 million, or $0.38 per share. Adjusted net income for the full year 2011, excluding these net charges, was $1.018 billion, or $0.67 per share.

Expansion of 2011 Restructuring Program

The company also announces an expansion of its 2011 restructuring program (the "Expansion") intended to build on the progress made under that program to strengthen our operational effectiveness and efficiencies and support new growth investments, which we expect will increase shareholder value. The company estimates that the Expansion will reduce gross annual pre-tax operating expenses by approximately $100 million to $115 million exiting 2013; and that the total 2011 restructuring program, including the Expansion (the "Total Program"), will reduce gross annual pre-tax operating expenses by approximately $340 million to $375 million exiting 2013. The company expects that a substantial portion of the Total Program savings will be reinvested in targeted areas for future growth, including strategic growth initiatives and emerging markets. Key activities under the Total Program are expected to be substantially completed by the end of 2013.

The company anticipates the reduction of 900 to 1,000 positions worldwide through a combination of employee attrition and targeted headcount reductions as a result of the Expansion. Plans detailing specific employee impacts will be developed for each affected region and business, and the company will work with employee representative bodies where required under local laws.

The company estimates that the implementation of the Expansion will result in total pre-tax charges of approximately $140 million to $160 million, and that approximately $100 million to $120 million of these charges will result in future cash outlays. The company estimates that the implementation of the Total Program will result in total pre-tax charges of approximately $300 million to $355 million, and that approximately $270 million to $300 million of these charges will result in future cash outlays.

Guidance for First Quarter and Full Year 2013

The company estimates sales for the first quarter of 2013 in a range of $1.740 to $1.815 billion. The company estimates earnings on a GAAP basis in a range of $0.04 to $0.07 per share. Adjusted earnings, excluding acquisition- and restructuring-related charges; and amortization expense, are estimated in a range of $0.14 to $0.17 per share.

The company estimates sales for the full year 2013 in a range of $7.050 to $7.350 billion. The company estimates earnings on a GAAP basis in a range of $0.29 to $0.37 per share. Adjusted earnings, excluding divestiture-related net credits, acquisition- and restructuring-related charges; and amortization expense, are estimated in a range of $0.64 to $0.70 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. (ET). 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 more than 30 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 us at www.bostonscientific.com.

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" 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 earnings and adjusted earnings for the first quarter and full year 2013; our financial performance; markets for our products and our market share; our business plans; our cost-savings and growth initiatives; our restructuring program activities and expected impact; and our positioning for revenue 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; 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.

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 news release.

CONTACT:

Denise Kaigler
508-650-8330 (office)
Global Corporate Communications
Boston Scientific Corporation
media@bsci.com

Steven Campanini
508-652-5740 (office)
Media Relations
Boston Scientific Corporation
media@bsci.com

Michael Campbell
508-650-8023 (office)
Investor Relations
Boston Scientific Corporation
investor_relations@bsci.com

                                                                                                                                BOSTON SCIENTIFIC CORPORATION
                                                                                                                      CONDENSED CONSOLIDATED GAAP RESULTS OF OPERATIONS
                                                                                                                                         (Unaudited)
                                                                                                                                                                                                                                                 
                                                                                                                                                               Three Months Ended                                            Year Ended
                                                                                                                                                                  December 31,                                              December 31,
    in millions, except per share data                                                                                                                                            2012     2011                 2012     2011
    ----------------------------------                                                                                                                                            ----     ----                 ----     ----
                                                                                                                                                                                                                               
    Net sales                                                                                                                                                                            $1,821                        $1,848                                  $7,249                         $7,622
    Cost of products sold                                                                                                                                                          583               660                         2,349                2,659
    Gross profit                                                                                                                                                                 1,238             1,188                         4,900                4,963
                                                                                                                                                                                                                               
    Operating expenses:
                                                                                                                                          Selling, general and administrative expenses      639                  621                      2,535                 2,487
                                                                                                                                          Research and development expenses                 239                  230                        886                   895
                                                                                                                                          Royalty expense                                    28                   33                        153                   172
                                                                                                                                          Amortization expense                              101                   96                        395                   421
                                                                                                                                          Goodwill impairment charges                                                   4,350               697
                                                                                                                                          Intangible asset impairment charges                                             142                21
                                                                                                                                          Contingent consideration expense (benefit)          4                  (12)                        (6)                    7
                                                                                                                                          Restructuring charges                              43                   12                        136                    89
                                                                                                                                          Litigation-related charges                         73                   48                        192                    48
                                                                                                                                          Gain on divestiture                                (4)                 (10)                       (15)                 (778)
                                                                                                                                          -----------
                                                                                                                                                                                 1,123             1,018                         8,768                4,059
                                                                                                                                                                                 -----             -----                         -----                -----
    Operating (loss) income                                                                                                                                                        115               170                       (3,868)                  904
                                                                                                                                                                                                                               
    Other (expense) income:
                                                                                                                                          Interest expense                                  (64)                 (72)                      (261)                 (281)
                                                                                                                                          Other, net                                         (1)                   2                         22                    19
    (Loss) income before income taxes                                                                                                                                               50               100                       (4,107)                  642
                                                                                                                                          Income tax (benefit) expense                      (10)                  (7)                       (39)                  201
                                                                                                                                          -----------
    Net (loss) income                                                                                                                                                                       $60                          $107                                 $(4,068)                          $441
                                                                                                                                                                                            ===                          ====                                 =======                           ====
                                                                                                                                                                                                                               
    Net (loss) income per common share - basic                                                                                                                                            $0.04                         $0.07                                  $(2.89)                         $0.29
    Net (loss) income per common share - assuming dilution                                                                                                                                $0.04                         $0.07                                  $(2.89)                         $0.29
                                                                                                                                                                                                                               
    Weighted-average shares outstanding
    -----------------------------------
    Basic                                                                                                                                                                      1,365.9           1,467.6                       1,406.7              1,509.3
    Assuming dilution                                                                                                                                                          1,375.0           1,479.9                       1,406.7              1,519.0

                                  BOSTON SCIENTIFIC CORPORATION
                              CONDENSED CONSOLIDATED BALANCE SHEETS

                                                                 As of
                                                                 -----
                                             December 31,           December 31,
    in millions, except share and
     per share data                                                        2012           2011
    -----------------------------                                          ----           ----
                                             (Unaudited)
    ASSETS
    Current assets:
              Cash and cash
              equivalents                           $207                                  $267
              Trade accounts
              receivable, net        1,217                                1,246
             Inventories               884                                  931
              Deferred income
              taxes                    433                                  458
              Prepaid expenses
              and other
              current assets           281                                  203
                                       ---
    Total current assets                                    3,022                        3,105

    Property, plant and
     equipment, net                                         1,564                        1,670
    Goodwill                                                5,973                        9,761
    Other intangible assets, net                            6,289                        6,473
    Other long-term assets                                    306                          281
                                                 $17,154                               $21,290
                                                 =======                               =======

    LIABILITIES AND STOCKHOLDERS'
     EQUITY
    Current liabilities:
              Current debt
              obligations                             $4                                    $4
             Accounts payable          232                                  203
             Accrued expenses        1,284                                1,327
              Other current
              liabilities              252                                  273
                                       ---
    Total current liabilities                               1,772                        1,807

    Long-term debt                                          4,252                        4,257
    Deferred income taxes                                   1,729                        1,865
    Other long-term liabilities                             2,531                        2,008

    Commitments and contingencies

    Stockholders' equity
              Preferred stock,
              $.01 par value
              -authorized
              50,000,000
              shares, none issued and
              outstanding
              Common stock,
              $.01 par value
              -authorized
              2,000,000,000
              shares, issued 1,542,347,188
              shares as of December 31,
              2012 and 1,531,006,390 shares as
              of December 31, 2011                   15                            15
              Treasury stock,
              at cost -
              186,635,532 as
              of December 31,
              2012
              and 81,950,716 shares as of
              December 31, 2011                  (1,092)                         (492)
              Additional paid-
              in capital            16,429                               16,349
              Accumulated
              deficit               (8,449)                              (4,381)
              Other
              stockholders'
              deficit                  (33)                                (138)
    Total stockholders' equity                              6,870                       11,353
                                                 $17,154                               $21,290
                                                 =======                               =======

                                                                                                                  BOSTON SCIENTIFIC CORPORATION
                                                                                               NON-GAAP NET INCOME AND NET INCOME PER COMMON SHARE RECONCILIATIONS
                                                                                                                           (Unaudited)
                                                                                                                                                                                                                                                
                                                                                                                                     Three Months Ended December 31,
                                                                                                                                     -------------------------------
                                                                                                                                                             2012                                        2011
                                                                                                                                                             ----                                        ----
                                                                                                                      Net                       Impact                           Impact
                                                                                                                    (loss)                   per diluted               Net     per diluted
    in millions, except per share data                                                                              income                       share               income       share
    ----------------------------------                                                                              ------                       -----               ------       -----
    GAAP net (loss) income                                                                                                                           $60                             $0.04                                    $107                         $0.07
    Non-GAAP adjustments:
                                                                                                  Acquisition-related net (credits) charges            1                                         (9)                (0.01)
                                                                                                  Divestiture-related net credits                     (2)                                        (9)                (0.01)
                                                                                                  Restructuring-related charges                       47                 0.04                              14                 0.01
                                                                                                  Litigation-related charges                          46                 0.03                              30                 0.02
                                                                                                  Discrete tax items                                                                    (5)
                                                                                                  Amortization expense                               100                 0.07                              69                 0.05
                                                                                                  ------------
    Adjusted net income                                                                                                                             $252                             $0.18                                    $197                         $0.13
                                                                                                                                                    ====                             =====                                    ====                         =====
                                                                                                                                                                                                     
                                                                                                                                         Year Ended December 31,
                                                                                                                                         -----------------------
                                                                                                                                                             2012                                        2011
                                                                                                                                                             ----                                        ----
                                                                                                                      Net                       Impact                           Impact
                                                                                                                    (loss)                   per diluted               Net     per diluted
    in millions, except per share data                                                                              income                       share               income       share
    ----------------------------------                                                                              ------                       -----               ------       -----
    GAAP net (loss) income                                                                                                                       $(4,068)                           $(2.89)                                   $441                         $0.29
    Non-GAAP adjustments:
                                                                                                  Goodwill impairment charges                      4,327                 3.06               *             697                 0.46
                                                                                                  Intangible asset impairment charges                119                 0.09               *              16                 0.01
                                                                                                  Acquisition-related net credits                    (30)               (0.02)              *             (27)               (0.02)
                                                                                                  Divestiture-related net credits                     (6)                                   *            (542)               (0.35)
                                                                                                  Restructuring-related charges                      122                 0.09               *              90                 0.06
                                                                                                  Litigation-related charges                         118                 0.08               *              30                 0.02
                                                                                                  Discrete tax items                                   2                                    *             (27)               (0.02)
                                                                                                  Amortization expense                               349                 0.25               *             340                 0.22
                                                                                                  ------------                                                                              ---
    Adjusted net income                                                                                                                             $933                             $0.66                                  $1,018                         $0.67
                                                                                                                                                    ====                             =====                                  ======                         =====

* Assumes dilution of 7.7 million shares for the year ended December 31, 2012 for all or a portion of these non-GAAP adjustments.

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 COMMON SHARE RECONCILIATIONS (CONT.)
                                                                                          (Unaudited)

                                                                                                    Three Months Ended                        Year Ended
    in millions                                                                                        December 31,                          December 31,
    -----------                                                                                        ------------                          ------------
                                                                                                    2012    2011                 2012           2011
                                                                                                    ----    ----                 ----           ----
    Goodwill impairment charges:
              Goodwill impairment charges                                                                                            $4,350                 $697
              Income tax benefit (a)                                                                                            (23)
    Goodwill impairment charges, net of tax                                                                                          $4,327                 $697
                                                                                                                                     ======                 ====

    Intangible asset impairment charges:
              Intangible asset impairment charges                                                                                      $142                  $21
              Income tax benefit (a)                                                                                            (23)            (5)
    Intangible asset impairment charges, net of tax                                                                                    $119                  $16
                                                                                                                                       ====                  ===

    Acquisition-related charges (credits):
              Contingent consideration (benefit) expense                                                    $4                         $(12)                       $(6)              $7
              Acquisition-related costs (credits) (b)                                               (2)               1                          4             3
              Inventory step-up adjustment (c)                                                               1                                           3
              Gain on previously held investments (d)                                                                           (39)           (38)

                                                                                                     2              (10)                       (41)          (25)
              Income tax (expense) benefit (a)                                                      (1)               1                         11            (2)
    Acquisition-related net (credits) charges, net of tax                                                   $1                          $(9)                      $(30)            $(27)
                                                                                                           ===                          ===                       ====             ====

    Divestiture-related net credits:
              Gain on divestiture                                                                          $(4)                        $(10)                      $(15)           $(778)
              Divestiture-related costs (c)                                                                 $2                           $1                         $6          5
                                                                                                   ---
                                                                                                    (2)              (9)                        (9)         (773)
              Income tax expense (a)                                                                                              3            231
    Divestiture-related net credits, net of tax                                                            $(2)                         $(9)                       $(6)           $(542)
                                                                                                           ===                          ===                        ===            =====

    Restructuring-related charges:
              Restructuring charges                                                                        $43                          $12                       $136              $89
              Restructuring-related charges (e)                                                      9                8                         24            40
                                                                                                   ---              ---
                                                                                                    52               20                        160           129
              Income tax benefit (a)                                                                (5)              (6)                       (38)          (39)
    Restructuring-related charges, net of tax                                                              $47                          $14                       $122              $90
                                                                                                           ===                          ===                       ====              ===

    Litigation-related net charges:
              Litigation-related net charges                                                               $73                   48                         $192          48
              Income tax benefit (a)                                                               (27)             (18)                       (74)          (18)
    Litigation-related net charges, net of tax                                                             $46                   30                         $118              $30
                                                                                                           ===                  ===                         ====              ===

    Discrete tax items:
              Income tax expense (benefit) (a)                                                                      $(5)                                 $2             $(27)


    Amortization expense:
              Amortization expense                                                                        $101                          $96                       $395             $421
              Income tax benefit (a)                                                                (1)             (27)                       (46)          (81)
    Amortization expense, net of tax                                                                      $100                          $69                       $349             $340
                                                                                                          ====                          ===                       ====             ====

    (a)              Amounts are tax affected 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."
    (b)              In the fourth quarter of 2012,
                     recorded a $1 million to
                     selling, general and
                     administrative expenses and a $3
                     million benefit to research and
                     development expenses.  In 2012,
                     recorded $7 million to selling,
                     general and administrative
                     expenses and $3 million benefit
                     to research and development
                     expenses
    (c)              Recorded to cost of products
                     sold.
    (d)             Recorded to other, net.
    (e)              In the fourth quarter of 2012,
                     recorded $1 million to cost of
                     products sold and $8 million to
                     selling, general and
                     administrative expenses. In the
                     fourth quarter of 2011, recorded
                     $8 million to cost of products
                     sold. In 2012, recorded $8
                     million to cost of products sold
                     and $16 million to selling,
                     general and administrative
                     expenses. In 2011, recorded $35
                     million to cost of products sold
                     and $5 million to selling,
                     general and administrative
                     expenses.

An explanation of the Company's use of these non-GAAP financial measures is provided at the end of this document.

                                                                BOSTON SCIENTIFIC CORPORATION
                                                                       WORLDWIDE SALES
                                                                         (Unaudited)
                                                                                                                                                                                     
                                                                                                 Change
                                                                                                 ------
                                                     Three Months Ended                                 As Reported                                  Constant
                                                        December 31,                                     Currency                                    Currency
                                                        ------------
    in millions                                           2012        2011                             Basis                                            Basis
    -----------                                           ----        ----                             -----                                            -----
                                                                (restated)     *
                                                                                                                                                                             
    United States                                                     $924                          $957                               (3)%                     (3)%
                                                                                                                                                                             
                                           EMEA                        396                  409                         (3)%                       (1)%
                                           Japan                       236                  247                         (4)%                         1%
                                           Inter-Continental           235                  205                          15%                        14%
    International                                          867                  861                             1%                       3%
                                                           ---                  ---                           ---                      ---
                                                                                                                                                                             
    Subtotal Core Businesses                             1,791                1,818                           (1)%                     (1)%
                                                                                                                                                                             
                                           Divested Businesses          30                   30                         N/A                        N/A
                                                                                                                                                                             
    Worldwide                                                       $1,821                        $1,848                               (1)%                       -  %
                                                                    ======                        ======                               ===                      ===

                                                                            Change
                                                                            ------
                                 Three Months
                                                  Ended          As Reported           Constant
                                               December 31,         Currency            Currency
                                      ------------
    in millions                            2012            2011        Basis       Basis
    -----------                            ----            ----        -----       -----

                 Interventional Cardiology                 $534   $594       (10)%         (9)%

                 Cardiac Rhythm Management                  457    482        (5)%         (4)%

                 Endoscopy                                  329    304         8 %         10 %

                 Peripheral Interventions                   199    184         8 %          9 %

                 Urology/Women's Health                     130    127         2 %          3 %

                 Neuromodulation                            104     91        14 %         14 %

                 Electrophysiology                           38     36         4 %          5 %
                                                            ---    ---

    Subtotal Core Businesses                              1,791  1,818        (1)%         (1)%

                 Divested Businesses                         30     30        N/A          N/A

    Worldwide                                            $1,821 $1,848        (1)%       -   %
                                                         ====== ======        ===         ====

* We have restated prior year regional detail to conform to current year presentation.

Growth rates are based on actual, non-rounded amounts and may not recalculate precisely.

An explanation of the Company's use of these non-GAAP financial measures is provided at the end of this document.

                                                                             BOSTON SCIENTIFIC CORPORATION
                                                                                    WORLDWIDE SALES
                                                                                      (Unaudited)
                                                                                                                                                                                                
                                                                                                                            Change
                                                                                                                            ------
                                                                                    Year Ended                                    As Reported                          Constant
                                                                                   December 31,                                     Currency                           Currency
                                                                                   ------------
    in millions                                                                      2012        2011                            Basis                                     Basis
    -----------                                                                      ----        ----                            -----                                     -----
                                                                                           (restated)     *
                                                                                                                                                                                           
    United States                                                                              $3,756                        $4,010                              (6)%                    (6)%
                                                                                                                                                                                           
                                                                      EMEA                      1,568                1,721                        (9)%                       (3)%
                                                                      Japan                       931                  951                        (2)%                       (2)%
                                                                      Inter-Continental           872                  799                          9%                        11%
    International                                                                   3,371                3,471                           (3)%                      1%
                                                                                    -----                -----                           ---                     ---
                                                                                                                                                                                           
    Subtotal Core Businesses                                                        7,127                7,481                           (5)%                    (3)%
                                                                                                                                                                                           
                                                                      Divested Businesses         122                  141                        N/A                        N/A
                                                                                                                                                                                           
    Worldwide                                                                                  $7,249                        $7,622                              (5)%                    (3)%
                                                                                               ======                        ======                              ===                     ===


                                                                     Change
                                                                     ------
                                              Year Ended               As Reported         Constant
                                             December 31,                Currency          Currency
                                             ------------
    in millions                           2012     2011        Basis               Basis
    -----------                           ----     ----        -----               -----

             Interventional Cardiology         $2,179                   $2,495                      (13)% (11)%

             Cardiac Rhythm Management 1,908             2,087                      (9)%             (7)%

             Endoscopy                 1,252             1,187                        5%               7%

             Peripheral Interventions    774               731                        6%               8%

             Urology/Women's Health      500               498                        -  %             1%

             Neuromodulation             367               336                        9%               9%

             Electrophysiology           147               147                        -  %             1%
                                         ---                                                         ---

    Subtotal Core Businesses           7,127             7,481                      (5)%             (3)%

             Divested Businesses         122               141                      N/A              N/A

    Worldwide                                  $7,249                   $7,622                       (5)%  (3)%
                                               ======                   ======                       ===   ===

* We have restated prior year regional detail to conform to current year presentation.

Growth rates are based on actual, non-rounded amounts and may not recalculate precisely.

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 CONSTANT CURRENCY NET SALES RECONCILIATIONS
                                                            (Unaudited)

                                                          Q4 2012 Net Sales as compared to Q4
                                                                          2011
                                                            ------------------------------------
                                                                  Change              Estimated
                                                                  ------
                                                      As Reported  Constant  Impact of
                                                       Currency    Currency   Foreign
    in millions                                        Basis      Basis    Currency
    -----------                                        -----      -----    --------

    United States                                                    $(33)                       $(33)

             EMEA                                           (13)                  (5)                  $(8)
             Japan                                          (11)                   1              (12)
             Inter-Continental                               30                   28                2
                                                            ---
    International                                             6                   24              (18)
                                                            ---                  ---              ---

    Subtotal Core Businesses                                (27)                  (9)             (18)

             Divested Businesses

    Worldwide                                                        $(27)                        $(9)      $(18)
                                                                     ====                         ===       ====


                                                        Q4 2012 Net Sales as compared to Q4
                                                                          2011
                                                          ------------------------------------
                                                                 Change             Estimated
                                                                 ------
                                                    As Reported  Constant  Impact of
                                                     Currency    Currency   Foreign
    in millions                                        Basis      Basis    Currency
    -----------                                        -----      -----    --------

             Interventional Cardiology                               $(60)                       $(53)       $(7)

             Cardiac Rhythm Management                      (25)                 (20)              (5)

             Endoscopy                                       25                   29               (4)

             Peripheral Interventions                        15                   17               (2)

             Urology/Women's Health                           3                    4               (1)

             Neuromodulation                                 13                   12                1

             Electrophysiology                                2                    2
                                                            ---

    Subtotal Core Businesses                                (27)                  (9)             (18)

             Divested Businesses

    Worldwide                                                        $(27)                        $(9)      $(18)
                                                                     ====                         ===       ====

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 CONSTANT CURRENCY NET SALES RECONCILIATIONS
                                                            (Unaudited)

                                                           Q4 2012 YTD Net Sales as compared to Q4
                                                                         2011 YTD
                                                          ----------------------------------------
                                                                 Change              Estimated
                                                                 ------
                                                     As Reported  Constant  Impact of
                                                      Currency    Currency  Foreign
    in millions                                       Basis      Basis    Currency
    -----------                                       -----      -----    --------

    United States                                                  $(254)                         $(254)

             EMEA                                         (153)                 (48)                     $(105)
             Japan                                         (20)                 (16)                 (4)
             Inter-Continental                              73                   86                 (13)
    International                                         (100)                  22                (122)
                                                          ----                  ---                ----

    Subtotal Core Businesses                              (354)                (232)               (122)

             Divested Businesses                           (19)                 (18)                 (1)

    Worldwide                                                      $(373)                         $(250)        $(123)
                                                                   =====                          =====         =====


                                                        Q4 2012 YTD Net Sales as compared to Q4
                                                                        2011 YTD
                                                       ----------------------------------------
                                                               Change              Estimated
                                                               ------
                                                   As Reported  Constant  Impact of
                                                    Currency    Currency  Foreign
    in millions                                       Basis      Basis    Currency
    -----------                                       -----      -----    --------

             Interventional Cardiology                             $(316)                         $(266)         $(50)

             Cardiac Rhythm Management                    (179)                (145)                (34)

             Endoscopy                                      65                   84                 (19)

             Peripheral Interventions                       43                   56                 (13)

             Urology/Women's Health                          2                    5                  (3)

             Neuromodulation                                31                   32                  (1)

             Electrophysiology                                         2                     (2)


    Subtotal Core Businesses                              (354)                (232)               (122)

             Divested Businesses                           (19)                 (18)                 (1)

    Worldwide                                                      $(373)                         $(250)        $(123)
                                                                   =====                          =====         =====

An explanation of the Company's use of these non-GAAP financial measures is provided at the end of this document.

                                                                  BOSTON SCIENTIFIC CORPORATION
                                               WORLDWIDE CARDIAC RHYTHM MANAGEMENT AND CORONARY STENT SYSTEM SALES
                                                                           (Unaudited)

    Three Months Ended December 31
    ------------------------------

    in millions                               U.S.                              International                            Worldwide
    -----------                               ----                              -------------                            ---------
                                   Q4 2012  Q4 2011           Q4 2012   Q4 2011          Q4 2012   Q4 2011
                                   -------  -------           -------   -------          -------   -------
    Defibrillator systems                      $204                        $214                               $126                     $134         $330   $348
    Pacemaker systems                    61               64                         66                  70                        127      134
    Total CRM products                         $265                        $278                               $192                     $204         $457   $482
                                               ====                        ====                               ====                     ====         ====   ====


    in millions                             U.S.                           International                        Worldwide
    -----------                             ----                           -------------                        ---------
                                   Q4 2012  Q4 2011           Q4 2012   Q4 2011          Q4 2012   Q4 2011
                                   -------  -------           -------   -------          -------   -------
    Drug-eluting stent systems                 $118                        $168                               $194                     $188     *   $312   $356
    Bare-metal stent systems              6                7                         15                  18                         21       25
    Total coronary stent systems               $124                        $175                               $209                     $206         $333   $381
                                               ====                        ====                               ====                     ====         ====   ====


    Year Ended December 31
    ----------------------

    in millions                             U.S.                           International                        Worldwide
    -----------                             ----                           -------------                        ---------
                                       2012    2011               2012     2011             2012       2011
                                       ----    ----               ----     ----             ----       ----
    Defibrillator systems                      $858                        $949                               $521                     $569       $1,379 $1,518
    Pacemaker systems                   256              279                        273                 290                        529      569
    Total CRM products                       $1,114                      $1,228                               $794                     $859       $1,908 $2,087
                                             ======                      ======                               ====                     ====       ====== ======


    in millions                             U.S.                           International                        Worldwide
    -----------                             ----                           -------------                        ---------
                                       2012    2011               2012     2011             2012       2011
                                       ----    ----               ----     ----             ----       ----
    Drug-eluting stent systems                 $557                        $750                               $720                     $759       $1,277 $1,509
    Bare-metal stent systems             24               32                         62                  79                         86      111
    Total coronary stent systems               $581                        $782                               $782                     $838       $1,363 $1,620
                                               ====                        ====                               ====                     ====       ====== ======

* The estimated impact of foreign currency exchange related to international Drug-eluting stent systems is approximately $5 million or 3%.

                                                                                BOSTON SCIENTIFIC CORPORATION
                                                                                    WORLDWIDE BRIC* SALES
                                                                                         (Unaudited)
                                                                                                                                                                                           
                                                                                                      Q4 2012 Percentage change in Net Sales as compared to Q4
                                                                                                                             2011
                                                                                                     ---------------------------------------------------------
                                                                                                                    Change                 Estimated
                                                                                                                    ------
                                                                                                     As Reported         Constant         Impact of
                                                                                                      Currency           Currency           Foreign
                                                                                                        Basis              Basis           Currency
                                                                                                        -----              -----           --------
                                                                                                                                                      
    Three Months Ended December 31, 2012                                                                      29%                                 35%                                (6)%
                                                                                                             ===                                 ===                                 ===

* BRIC - Countries comprised of Brazil, Russia, India and China ("BRIC")

                                                               BOSTON SCIENTIFIC CORPORATION
                                                       SUPPLEMENTAL NON-GAAP RECONCILIATIONS, CONT.
                                                                        (Unaudited)

    Q1 and Full Year 2013 EPS Guidance
    ----------------------------------

                                           Q1 2013 Estimate                      Full Year 2013 Estimate
                                           ----------------                      -----------------------
                                       (Low)    (High)              (Low)    (High)
    GAAP results                                 $0.04                        $0.07                           $0.29 $0.37
    ------------                                 -----                        -----                           ----- -----


    Estimated
     acquisition-
     related net
     charges (credits)                    0.01             0.01                          0.03            0.03
    Estimated divestiture-related
     net credits                                                      (0.03)            (0.03)
    Estimated
     restructuring-
     related charges
     (credits)                            0.02             0.02                          0.08            0.06
    Estimated
     amortization
     expense                              0.07             0.07                          0.27            0.27

    Adjusted results                             $0.14                        $0.17                           $0.64 $0.70
    ----------------                             -----                        -----                           ----- -----

An explanation of the Company's use of these non-GAAP measures is provided at the end of this document.


Use of Non-GAAP Financial Measures

To supplement Boston Scientific's consolidated financial statements presented on a GAAP basis, the Company discloses certain non-GAAP financial measures, including adjusted net income and adjusted net income per share that exclude certain amounts and regional and divisional revenue growth rates that exclude the impact of changes in foreign currency exchange rates. These non-GAAP financial measures are not in accordance with generally accepted accounting principles in the United States.

The GAAP financial measure most directly comparable to adjusted net income is GAAP net income and the GAAP financial measure most directly comparable to adjusted net income per share is GAAP net income per share. To calculate regional and divisional revenue growth rates that exclude the impact of changes in foreign currency exchange rates, the Company converts actual net sales from local currency to U.S. dollars using constant foreign currency exchange rates in the current and prior period. The GAAP financial measure most directly comparable to this non-GAAP financial measure is growth rate percentages using 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 the Company's business, to assess its performance relative to its 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 the Company's operating segments. The adjustments excluded from the Company's non-GAAP financial measures are consistent with those excluded from its operating segments' measures of profit or loss. These adjustments are excluded from the segment measures that are reported to the Company's chief operating decision maker that are used to make operating decisions and assess performance.

The Company believes that presenting adjusted net income, adjusted net income per share and regional and divisional revenue growth rates that exclude the impact of changes in foreign currency exchange rates, in addition to the corresponding GAAP financial measures, provides investors greater transparency to the information used by Boston Scientific management for its financial and operational decision-making and allows investors to see Boston Scientific's results "through the eyes" of management. The Company further believes that providing this information assists Boston Scientific's investors in understanding the Company's operating performance and the methodology used by management to evaluate and measure such performance.

The following is an explanation of each of the adjustments that management excluded as part of these non-GAAP financial measures for the three months and full year ended December 31, 2012 and 2011 and for the forecasted three month period ending March 31, 2013 and full year ending December 31, 2013, as well as reasons for excluding each of these individual items:

Adjusted Net Income and Adjusted Net Income per Share:

             Goodwill and other intangible
             asset impairment charges - These
             amounts represent non-cash
             write-downs of the Company's
             goodwill balances attributable to
             its (a) U.S. Cardiac Rhythm
             Management reporting unit in the
             third quarter of 2012, (b)
             Europe/Middle East/Africa
             (EMEA) reporting unit recorded in
             the second quarter of 2012, and
             (c) U.S. Cardiac Rhythm
             Management reporting unit
             recorded in the first quarter of
             2011 and non-cash write-downs
             of certain other intangible asset
             balances.  Management removes the
             impact of non-cash goodwill and
             other intangible asset impairment
             charges from the Company's
             operating performance to assist
             in assessing the Company's cash
             generated from operations.
             Management believes this is a
             critical metric for the Company
             in measuring the Company's
             ability to generate cash and
             invest in the Company's growth.
             Therefore, these charges are
             excluded from management's
             assessment of operating
             performance and are also excluded
             for purposes of calculating these
             non-GAAP financial measures to
             facilitate an evaluation of the
             Company's current operating
             performance and a comparison to
             the Company's past operating
             performance, particularly in
             terms of liquidity.
            ---------------------------------

             Acquisition-related charges
             (credits) - These adjustments
             consist of (a) acquisition-
             related gains on previously held
             investments, (b) contingent
             consideration fair value
             adjustments,  (c) inventory step-
             up adjustments, (d) due diligence
             and other fees, exit costs and
             other costs and credits related to
             current and prior period
             acquisitions, . The acquisition-
             related gains on previously held
             investments are non-recurring
             benefits associated with
             acquisitions completed in the
             second quarter of 2012 and the
             first quarter of 2011. 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.
             The inventory step-up adjustment
             is a charge related to acquired
             inventory directly attributable to
             prior acquisitions and is not
             indicative of the Company's on-
             going operations, or on-going
             cost of products sold.  Due
             diligence, exit costs and other
             costs and credits include legal,
             tax, severance and other expenses
             and credits associated with prior
             acquisitions that are not
             representative of on-going
             operations.  Accordingly,
             management excluded these amounts
             for purposes of calculating these
             non-GAAP financial measures to
             facilitate an evaluation of the
             Company's current operating
             performance and a comparison to
             the Company's past operating
             performance.
             ----------------------------------

             Divestiture-related net credits -
             These amounts represent (a) gains
             resulting from business
             divestitures and (b) fees and
             separation costs associated with
             business divestitures. The Company
             completed the sale of its
             Neurovascular business in January
             2011 and the resulting gains are
             not indicative of future operating
             performance and are not used by
             management to assess operating
             performance. Fees and separation
             costs represent those associated
             with the Company's divestiture of
             its Neurovascular business and are
             not representative of on-going
             operations. Accordingly,
             management excluded these amounts
             for purposes of calculating these
             non-GAAP financial measures to
             facilitate an evaluation of the
             Company's current operating
             performance and a comparison to
             the Company's past operating
             performance.
            ----------------------------------

             Restructuring and restructuring-
             related costs - These
             adjustments represent primarily
             severance, costs to transfer
             production lines from one
             facility to another, and other
             direct costs associated with the
             Company's 2011 Restructuring
             plan, 2010 Restructuring plan
             and Plant Network Optimization
             program. These expenses are
             excluded by management in
             assessing the Company's
             operating performance, as well
             as from the Company's operating
             segments' measures of profit and
             loss used for making operating
             decisions and assessing
             performance. Accordingly,
             management excluded these
             charges for purposes of
             calculating these non-GAAP
             financial measures to facilitate
             an evaluation of the Company's
             current operating performance
             and a comparison to the
             Company's past operating
             performance.
             --------------------------------

             Litigation-related net charges -
             These adjustments include certain
             significant product liability and
             other litigation-related charges
             and credits. These amounts are
             excluded by management in
             assessing the Company's operating
             performance, as well as from the
             Company's operating segments'
             measures of profit and loss used
             for making operating decisions
             and assessing performance.
             Accordingly, management excluded
             these amounts for purposes of
             calculating these non-GAAP
             financial measures to facilitate
             an evaluation of the Company's
             current operating performance and
             a comparison to the Company's
             past operating performance.
            ---------------------------------

             Discrete tax items - These items
             represent adjustments of certain
             tax positions, which were
             initially established in prior
             periods as a result of
             intangible asset impairment
             charges; acquisition-,
             divestiture-, restructuring-
             or litigation-related charges
             (credits). These adjustments do
             not reflect expected on-going
             operating results. Accordingly,
             management excluded these
             amounts for purposes of
             calculating these non-GAAP
             financial measures to facilitate
             an evaluation of the Company's
             current operating performance
             and a comparison to the
             Company's past operating
             performance.
             --------------------------------

             Amortization expense -
             Amortization expense is a non-
             cash charge and does not impact
             the Company's liquidity or
             compliance with the covenants
             included in its credit facility
             agreement. Management removes the
             impact of amortization from the
             Company's operating performance to
             assist in assessing the Company's
             cash generated from operations.
             Management believes this is a
             critical metric for the Company in
             measuring the Company's ability to
             generate cash and invest in the
             Company's growth. Therefore,
             amortization expense is excluded
             from management's assessment of
             operating performance and is also
             excluded from the measures
             management uses to set employee
             compensation. Accordingly,
             management has excluded
             amortization expense for purposes
             of calculating these non-GAAP
             financial measures to facilitate
             an evaluation of the Company's
             current operating performance,
             particularly in terms of
             liquidity.
            ----------------------------------

Regional and Divisional Revenue Growth Rates Excluding the Impact of Changes in Foreign Currency Exchange Rates

             Changes in foreign currency
             exchange rates -The impact of
             changes in foreign currency
             exchange rates is highly
             variable and difficult to
             predict. Accordingly,
             management excludes the impact
             of changes in foreign currency
             exchange rates for purposes of
             reviewing regional and
             divisional revenue growth rates
             to facilitate an evaluation of
             the Company's current operating
             performance and a comparison to
             the Company's past operating
             performance.
             -------------------------------

Adjusted net income, adjusted net income per share and regional and divisional revenue growth rates that exclude the impact of changes in foreign currency exchange rates 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 Boston Scientific does, which may limit the usefulness of those measures for comparative purposes.

SOURCE Boston Scientific Corporation

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