ZURICH, July 29 – Swiss medical device maker Synthes (SYST.VX) stuck to its guarded outlook for the rest of the year, despite a rise in first-half earnings, as demand for its products slowed in Asia and the United States.
The maker of nails, screws and plates to fix broken bones posted an 11.2 percent rise in first-half net profit to $424.6 million, largely in line with the average estimate in a Reuters poll.[ID:nLDE66L1HF]
“The company does not expect the challenging and dynamic market environment to change in the short-term,” the group said in a statement.
Synthes, which also makes artificial spine discs, expects revenue growth of 5 to 10 percent in local currencies in the second half and the group said it was seeking to reverse the sales drop in its spine unit in North America.
Second-quarter sales rose 6.9 percent in local currencies to $892.2 million in the second quarter.
The company said its gross profit margin slipped to 82.4 percent in the first six months of the year from 83.1 percent in the year-ago period.
Synthes, like peers Stryker (SYK.N), Boston Scientific Corp (BSX.N) and Zimmer (ZMH.N), is facing increased pricing pressures for medical devices as global budgetary measures prompt hospitals to find ways to slash costs.[ID:nN22258939]
The orthopaedic sector has also come under pressure as many patients have decided to defer elective surgical procedures that require out-of-pocket payments. (Reporting by Katie Reid and Oliver Hirt)