Medical battery maker Greatbatch said Thursday that first-quarter profits fell 17.9 percent on lower sales across all product lines and higher research and development costs.

The Clarence-based company reported net income of $5.5 million, or 24 cents per share, down from $6.7 million, or 28 cents per share, a year ago.

Income before taxes fell 12.3 percent to $8.5 million, while operating income fell 5.4 percent to $14 million.

Adjusted operating income —which excludes costs from facility closings, manufacturing transfer and system integration charges, and writedowns of assets— fell 15 percent to $15 million. Adjusted net income fell 23 percent to $7.4 million, or 32 cents per share, from $9.64 million, or 41 cents per share.

Still, executives were upbeat and confident, citing improved profitability and sales growth across the board from the fourth quarter, when the company reported an operating loss of $2.29 million. They touted their efforts to diversify and reiterated their projections and earnings guidance for the year.

“Our sales results were in line with our expectations and indicative of a good start to the year,” said Chief Executive Officer Thomas J. Hook. “We carried the momentum that began in the fourth quarter of last year into 2010.”

He acknowledged that “we expect difficult market conditions that are impacting our results to continue through the first half of 2010.” But he added, “We remain committed to our long-term growth and profitability, which we believe will be fueled by our investments in innovative products and solutions, as well as improved operational efficiencies.”

Total sales fell 6 percent from a year ago to $132 million because customers stocked up on inventory during the year and markets slowed. Orthopedics were down 14 percent, while vascular sales fell 24 percent.

But sales were up 5 percent from the fourth quarter, in the second straight quarterly increase, including a 17 percent gain in orthopedics to $29.4 million and an 8 percent rise in vascular to $8.2 million. Electrochem fell 1 percent from a year ago but rose 3 percent from December, to $17.5 million.

Gross profit of $41.7 million, after the cost of sales as a percentage of sales, was flat from a year ago at 31.6 percent, as the benefits of cost-cutting were countered by lower production volumes and excess capacity.

Selling, general and administrative costs fell 16 percent to $15.7 million because of cost-cutting and consolidation efforts. Hook said Greatbatch has completed its announced consolidations, but will seek more efficiency.

Research and development spending rose 40 percent to $11 million, as the company emphasized new technologies for long-term growth opportunities.

“While other companies are cutting back on R&D, we are increasing our spending in this area,” Hook said on a call with investors. “We remain confident that this investment in R&D will enable us to maintain our margin improvement.”