01—Abstract
Summary
Summary of the 10-K filed February 23, 2022. Cited figures are marked; the original filing is the authoritative source.
Boston Scientific Corporation (BSX) reported a significant increase in net sales for the year ended December 31, 2021, reaching $11.888 billiona, a 19.9% increase compared to 2020.
This growth was primarily driven by the recovery of elective and semi-emergent medical procedures, which were impacted by the COVID-19 pandemic in the prior year. The company's strategic acquisitions, including Preventice Solutions, Farapulse, and Lumenis's global surgical business, also contributed positively to the sales performance. While the company reported a net income of $985 millionb ($0.69 per diluted share), adjusted net income, excluding certain charges and credits, was $2.336 billion ($1.63 per diluted share), reflecting strong operational performance.
The company's gross profit margin improved to 68.8% in 2021, up from 65.0% in 2020, attributed to higher sales volumes and a favorable product mix, though offset by inflationary pressures on raw materials and freight. Looking ahead, Boston Scientific is focused on its strategic imperatives, including strengthening category leadership and expanding into high-growth adjacencies. The company maintains a strong liquidity position with $1.925 billionc in unrestricted cash and cash equivalents.
However, ongoing challenges include managing supply chain disruptions, potential increases in costs, and navigating a dynamic regulatory and reimbursement landscape. The company also reported substantial litigation-related charges, particularly concerning transvaginal surgical mesh products. Despite these challenges, BSX demonstrated resilience and a clear growth trajectory in 2021, driven by its diverse product portfolio and strategic initiatives.
02—Key points
Key Highlights
- Net sales increased by 19.9% to $11.888 billion in 2021, driven by procedural recovery and strategic acquisitions.
- Gross profit margin improved to 68.8% in 2021 from 65.0% in 2020, aided by higher volumes and favorable mix, despite cost pressures.
- Acquisitions of Preventice Solutions, Farapulse, and Lumenis's surgical business contributed to sales growth and portfolio expansion.
- The company reported strong operational performance with adjusted net income of $2.336 billion ($1.63 per diluted share) for 2021.
- Liquidity remains robust with $1.925 billion in unrestricted cash and cash equivalents as of December 31, 2021.
- Significant litigation-related charges, particularly for transvaginal surgical mesh products, impacted reported results.
- The company is actively managing supply chain challenges and inflationary pressures, which are expected to impact gross margins in 2022.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2021, Boston Scientific Corp kept $0.09.
- Revenue$11.89B100.0%
- Cost of revenue−$3.71B31.2%
- Gross profit$8.18B68.8%
- Operating costs−$6.98B58.7%
- Operating income$1.20B10.1%
- Interest, other & tax−$158.0M1.3%
- Net income$1.04B8.8%
Where FY2021 revenue went
$11.89B- SG&A: $4.36B, 37% of revenue
- Cost of revenue: $3.71B, 31% of revenue
- Other operating costs: $2.62B, 22% of revenue
- Net income: $1.04B, 8.8% of revenue
- Interest, other & tax: $158.0M, 1.3% of revenue
Kept 8.8% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2021filed February 23, 2022Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $11.89B$9.91B | +19.9% |
| Cost of Revenue | $3.71B$3.46B | +7.1% |
| Gross Profit | $8.18B$6.45B | +26.8% |
| SG&A Expenses | $4.36B$3.79B | +15.1% |
| Operating Expenses | $6.98B$6.53B | +6.9% |
| Operating Income | $1.20B-$80.00M | +1598.8% |
| Interest Expense | $341.00M$361.00M | −5.5% |
| Net Income | $1.04B-$82.00M | +1369.5% |
| EPS (Basic) | $0.69$-0.08 | +962.5% |
| EPS (Diluted) | $0.69$-0.08 | +962.5% |
| Shares Outstanding (Basic) | 1.42B1.42B | +0.4% |
| Shares Outstanding (Diluted) | 1.43B1.42B | +1.2% |
05—Questions
Frequently Asked Questions
What was Boston Scientific's financial performance in 2021?
In 2021, Boston Scientific reported net sales of $11.888 billion, a 19.9% increase year-over-year. This growth was driven by the recovery of medical procedures impacted by COVID-19 and contributions from recent acquisitions. Reported net income was $985 million, or $0.69 per diluted share, while adjusted net income was $2.336 billion, or $1.63 per diluted share.
How did the company's product segments perform in 2021?
All major product segments showed growth in 2021. Cardiovascular led with a 25.3% increase in net sales, driven by Interventional Cardiology. MedSurg and Rhythm and Neuro also saw significant growth of 21.4% and 19.7% respectively, reflecting the broad recovery across the company's portfolio.
What are the key risks or challenges facing Boston Scientific?
Key challenges include navigating supply chain disruptions, managing inflationary pressures on costs, potential negative impacts from evolving healthcare policies and reimbursement rates, and ongoing litigation, particularly related to transvaginal surgical mesh products. The company also faces intense competition and the need for continuous innovation.
What is the company's strategy for future growth?
Boston Scientific's strategy centers on five imperatives: strengthening category leadership, expanding into high-growth adjacencies, driving global expansion (including in emerging markets), funding innovation, and developing key capabilities. This includes ongoing investment in R&D and pursuing strategic acquisitions.
06—Continue