July 29, 2020 / 6:47 AM / 10 days ago

Smith+Nephew profit misses, but easing lockdowns boost operations

(Reuters) - Medical products maker Smith+Nephew on Wednesday reported lower-than-expected first-half profit as patients and hospitals delayed hip and knee joint replacement operations during the coronavirus-driven lockdowns.

Hospitals are under strain globally to accommodate patients infected by the novel coronavirus and have been postponing non-emergency surgery, while some patients, wary of going to clinics for fear of contracting the virus, are cancelling appointments themselves.

However, the United States and China, Smith+Nephew’s two biggest markets, along with Europe have seen a pickup in demand towards the end of the period as countries began easing restrictions put in place to contain the virus.

The company said sales on an underlying basis fell about 47% in April, 27% in May and 12% in June, with China returning to growth in the second quarter.

Smith+Nephew, founded in 1856, makes orthopaedic implants and prosthetics, along with wound dressings and other surgical technologies. Newer markets have emerged as growth drivers for it as populations grow and medical expertise improves.

Trading profit in the six months ended June 27 fell to $172 million from $532 million last year, while sales slumped 18.7% on an underlying basis, as all of the company’s segments were hit.

Analysts were expecting a first-half profit of $225 million on average, according to a company-compiled consensus here of nine analysts.

Reporting by Pushkala Aripaka in Bengaluru, Editing by Sherry Jacob-Phillips and Krishna Chandra Eluri

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