Smith & Nephew sees profits rise as demand for products grows

Olivier Bohuon, chief executive of Smith & Nephew. Picture: VisMedia
Olivier Bohuon, chief executive of Smith & Nephew. Picture: VisMedia
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Medical devices firm Smith & Nephew said it finished the year strongly after fourth quarter profits rose 10 per cent to £144m.

The maker of replacement knees and hips said that 2014 would see it target higher growth opportunities and focus on efficiency.

The group, which was founded in Hull, posted an eight per cent rise in fourth-quarter underlying trading profit, beating market expectations, as demand for its orthopaedic reconstruction products improved.

The company posted a trading profit of £178m on revenue of £720m, up six per cent on an underlying basis.

Chief executive Olivier Bohuon said the firm finished the year strongly.

“Our Orthopaedic reconstruction business confirmed its improved dynamic, in particular delivering 11 per cent growth in US knees,” he said.

For 2014, he said orthopaedic reconstruction would continue its recent improved performance, and he expected it to grow at approaching the market rate.

Earlier this week Smith & Nephew agreed to buy medical devices company ArthroCare Corp for £1bn.

The deal was reached to strengthen the company’s sports medicine business.

S&N said it would pay £29.51 a share for ArthroCare, representing a 20 per cent premium.

Mr Bohuon said it was a “compelling opportunity” to add ArthroCare’s products and technology to its sports medicine unit.

Mr Bohuon said the US company’s expertise in treating shoulder joints will complement Smith & Nephew’s strength in knee surgery.