Boston Scientific CFO: We'll use cash to buy back shares, make acquisitions

September 14, 2011 by MassDevice staff

Now that Boston Scientific Corp. (NYSE:BSX) has paid off a slew of debt, legal bills and earnouts, it's turning its eye toward buying back its own stock and making further acquisitions, CFO Jeffrey Cappello told investors at a conference in New York today.

The Natick, Mass.-based medical device maker has significantly reduced its debt nut over the past few years. Last summer, Boston Scientific refinanced its debt load to create "minimal debt obligations for the next three years," Cappello said at the time.

That means BSX can use the more than $100 million a month it generates in free cash flow for share buybacks and bolt-on acquisitions, the finance chief told analysts at the Morgan Stanley Global Health Conference this morning.

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"We're to a point where really the only significant obligations we have in a debt capacity aren't maturing until 2014, so the company is in a great position from a capital perspective," Cappello said. "The stock is significantly undervalued and we aim to use our cash flow to buy back shares. We also want to grow the top line, so you can look for us to be fairly active from a business development perspective at the same time. The beauty of it is to have the capacity to go and do both at the same time. I would look, for the foreseeable future, to see a good balance between share repurchase and bolt-on acquisitions.

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