Smith & Nephew (NYSE:SNN) today cut its outlook for the rest of the year after reporting “weaker” first-quarter results, sending share prices down in London and New York.
The orthopedics and wound care giant posted sales of $1.20 billion for the three months ended March 31 (the company no longer reports first- or third-quarter earnings), with outgoing CEO Olivier Bohuon blaming the roiling U.S. insurance market and lower reconstructive procedure volumes in the U.K.
“Our businesses delivered a mixed performance in the first quarter, with the effects of some softer markets and a slowdown in our bioactives business offset by another quarter of strong growth in the emerging markets. We expect trading conditions to return to more normal levels, which, combined with the continued rollout of new products and our sustained emerging markets performance, gives us confidence in delivering an improving performance trend during the remainder of the year,” said Bohuon, who is slated to be replaced May 7 by former Alere (NYSE:ALR) chief Namal Nawana.
“It has been a privilege to lead Smith & Nephew and work with truly inspiring colleagues. With our portfolio, platform and people I believe the company has a successful and exciting future led by Namal, and I would like to thank all employees for their dedication during my time as chief executive,” Bohuon said today in prepared remarks.
Smith & Nephew cut its guidance for the rest of 2018, saying it now expects to post profit margins “at or above” last year’s mark on adjusted sales growth of 2% to 3%, compared with prior guidance for a 30-to-70-basis-point gain on sales growth of 3% to 4%.
The news sent SN share prices down -5.6% to £13.215 today in mid-afternoon activity in London; in New York, SNN shares were off -5.1% at $ 36.44 each in pre-market trading before sliding -5.2% to a $36.40 open.
