Investors on both sides of the Atlantic today reacted to lower-than-expected 1st-quarter earnings from Smith & Nephew (FTSE:SN, NYSE:SNN) today by sending share prices down nearly 2%.
Smith & Nephew posted profits of $150 million, or 84¢ per share, on sales of $1.07 billion for the 3 months ended March 29, for a 4.9% top-line gain on a -0.2% sales decline compared with Q1 2013. Adjusted to exclude 1-time items, earnings per share were 88.5¢, 4.5¢ under analysts’ expectations.
The news sent SN shares down 1.6% to a £9.05-per-share close in London today. SNN shares were down 2.0% to $76.41 each in New York as of about 1:14 p.m. today.
"Our underlying revenue growth was 1% in the 1st quarter. We remain confident in our 2014 outlook as we roll-out our strong pipeline of new products, benefit from recent investments in marketing and the salesforce and see an increasing contribution from acquisitions," CEO Olivier Bohuon said in prepared remarks. "We are today confirming the outcome from our review to optimize our group structure. The identified activities will support our strategic priorities by refining and simplifying our operational platform and delivering at least $120 million of annualized efficiency savings."
Smith & Nephew said it’s on track to close its $1.7 billion dollar buyout of sports medicine and minimally invasive surgical devices maker ArthroCare (NSDQ:ARTC) in mid-2014.
