S&N looks to the emerging markets

ARTIFICIAL joints maker Smith & Nephew said emerging markets would help counter slow European and United States trade in 2013, as it posted a drop in fourth-quarter profits after rivals’ new products hurt its knee implant business.

Having cut jobs and reorganised to reduce reliance on those slower markets, the company saw emerging market sales deliver 14 per cent growth – against just 1 per cent in the US and 2 per cent in Europe – while revenue in China rose 30 per cent.

“We expect the market conditions seen in 2012 broadly to continue in 2013,” Smith & Nephew said in a statement.

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Smith & Nephew has its advanced wound management business in Hull, where it employs 800 people. The company, which competes with Johnson & Johnson, Zimmer and Stryker in implants, said overall trading profit was $272m for the three months to end-December, down from $279m a year ago, but up 2 per cent excluding the impact of currency and acquisitions.

The fourth-quarter results beat market expectations on both the top and bottom line. The group posted revenue of $1.08bn, slightly down on a year ago, and adjusted earnings per share were 21.6 cents, down from 21.9 cents in the fourth quarter.

Shares in the group have risen by 4 per cent since the start of 2013.