Smith & Nephew Q2 tops forecasts

5th Aug 2010 07:12

Medical devices firm Smith & Nephew said it sees clear signs of progress in its US trauma and European businesses and a strong emerging market performance as it posted a 7% rise in second quarter trading profit.Trading profit rose to $226m for the three months to 3 July rose from $212mbefore. Revenue increased to $959m from $926m previously. Pre-tax profit rose to $202m from $176m. Adjusted earnings per share rose a better than expected 11% to 17.1 cents.Commenting on pressure from hospitals to reduce its prices, chief executive David Illingworth said, "Our customers are facing short-term budgetary pressures and challenges and our strategy is to be part of the solution." Analysts have recently expressed concern that slowing sales in the US and squeezed margins in Europe would impact its bottom line in 2011. During the quarter like-for-like pricing pressure edged up to around 2%.Smith & Nephew said, "The long-term industry growth drivers - including demographics, emerging markets and patients' desire to return to an active life remain intact," the group said.It added that its orthopaedic business would benefit from new products in the second half.The interim dividend increased by 10% to 6.0c.