(Reuters) – British medical equipment maker Smith+Nephew retained its annual revenue and profit forecasts on Wednesday, despite marginally missing market expectations for first-quarter revenue due to a softness in its advanced wound management segment.
“Revenue growth in the first quarter was driven by solid performance in our orthopaedics and sports medicine & ENT businesses, partially offset by some anticipated softness in advanced wound management,” CEO Deepak Nath said in a statement.
The company, which is present in more than 100 countries, also forecast a 70 basis point (bp) headwind for the volume-based procurement (VBP) programme in China in 2024.
The VBP regulation, which is due to commence this month in China, is aimed at lowering prices of medical consumables and equipment by tendering the market volume to manufacturers at the lowest price, leading to high price cuts and reduction in market shares.
Watford-headquartered Smith+Nephew posted a revenue of $1.39 billion for the three months ended March 30, slightly below analysts’ average expectations of $1.40 billion, according to a company-compiled consensus.
Analysts expect the firm to log an annual revenue growth of 5.4% and trading margin of 18.2%, while Smith+ Nephew forecast revenue to grow between 5% and 6% and trading margin of 18%.
(Reporting by Prerna Bedi in Bengaluru; Editing by Rashmi Aich and Subhranshu Sahu)
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