Smith & Nephew PLC posted a 73 percent profit surge in the third quarter, bolstered by an improving orthopedic market in the United States.
The London-based medical device maker generated $128 million in profits for the quarter, up from $74 million it reported in the third quarter 2008.
Adverse currency exchange rates brought revenues down 2 percent from $930 million in the third quarter last year to $915 million this year. Without the exchange rates, the company said revenues would have grown 1 percent.
Revenues for the company’s Memphis-based orthopedic division were flat at $503 million for the quarter. Orthopedic trauma revenues fell 5 percent in the quarter due to a loss of military orders and a weakness in the external fixation market.
But hip and knee sales showed signs of life with a 5 percent improvement over the year-ago quarter. Hip and knee sales have been stymied recently by a weak economy that led patients to put off surgery.
Smith and Nephew CEO David Illingworth said while progress is being made, younger and more active patients are still putting off reconstructive surgeries.
“The hip and knee business has clearly been the biggest challenge for them and to see such sequential improvement is encouraging,” Piper Jaffray & Co. analyst Matt Miksic said. “They’re seeing improving business trends and have launched some new products but the success isn’t because of one particular product or another.”
While green shoots of growth are appearing in the medical device market, Smith & Nephew officers held their revenue guidance from the last quarter.
“Market conditions remain challenging, but are showing some early signs of stabilizing,” Illingworth said. “We continue to invest in new products and medical education programs and we are well positioned as market conditions improve.”