Its true that revenues have been flat at BSC for the past few quarters, but you also have to realize that the Obamacare tax on medical device companies kicks in on January 1st, 2013. After that point, BSC will be writing $10,000,000 checks to the US Treasury EVERY single month. Thats in addition to their normal tax rate. Thanks to Obama and those that voted for obamacare (Klobuchar, Franken), the Twin Cities medical device companies are forced to either cut staff or offshore products to try to make up for lost revenue that could be going to R&D. The company will not attribute these layoffs to Obamacare, because most companies just do not want to call him out. Be smart when it comes time to vote in November. Know who has your back, who is protecting your livelihood.....it surely isn't the democrats.
In the case of BSX, it's the ineptitude of executive "management" on how to run a company, and the need to inflate their "performance bonuses" that drives layoffs. Obamacare is only an excuse for layoffs in the case of BSX, not the reason. Well-run medical device companies that have diversified and growing international sales are doing fine and will not take much of a hit from Obamacare, since Obamacare only taxes US sales of medical devices. Hence even foreign companies with overseas plants that sell foreign-made devices in the US will take a hit from Obamacare as well. BSX has moved most production offshore to Costa Rica and Ireland, but layoffs have started in Ireland. BSX revenues have been dropping faster than a dress on prom night for the past 4 years (even before Obama was elected), and the only way management can boost EPS is through layoffs. BSX stock price has crashed from $45 to $5 over the past 8 years. BSX has neglected their R&D pipeline since 2006 when they got the FDA Corporate Warning letter, and they have fallen years behind their competitors in terms of technology. Even with the warning letter lifted, it was a mortal blow to BSX in terms of technological advancement, and you see companies like Edwards and Medtronic with commercialized heart valves, Abbott with the fully-absorbable drug eluting stent commercialized in Europe, and JNJ walking away from the Guidant deal unscathed, while BSX took a $28 billion hit that they can never recover from. Believe me, Nicholas, Abele, Tobin, Elliott, and now Kucheman and Mahoney have done more damage to BSX to the tune of tens of billions of dollars, dwarfing a potential $100 million Obamacare tax.
Lay offs to take place the week of Oct 8th. Previous cuts in Sept were related to relocation of DES manufacturing to Irleand. Oct cuts are happening in R&D and Management( as deep as 20 percent in some areas, but no official figure as too total headcount has been released).
Confirmed layoffs at multiple sites. this company has been dieing the slow death for years. Too bad they are starting to cut into some talented people. True the needed to get rid of some dead wood, but perhap they should look higher up the food chain. With this much debt and a boring product line, it's hard to think this won't be broken up or just sold off like scraps. worth spend a few thousand just to play the long shot though. Let's issue a CAPA on upper managment...:))