By Scott Kanowsky
Investing.com -- Smith & Nephew PLC (LON: SN ) shares slumped by more than 11% after the British medical technology company posted second quarter sales that missed expectations and lowered its full-year profit margin forecast.
Reported revenue growth during the period dropped by 3.1% to $1.29B, dragged down in part by negative currency headwinds stemming from a recent surge in strength of the U.S. dollar. Analysts had estimated the figure to come in at $1.32B.
Sales at the group's orthopedics business - which made up 40% of total revenue during the same period last year - was also hit by "execution and supply chain challenges," according to chief executive officer Deepak Nath. Quarterly reported revenue growth at the unit dropped by 4.9% to $530M.
The company also now expects to report an annual trading profit margin of around 17.5%. In February, Smith & Nephew targeted a 50 basis point expansion on last year's figure of 18%.
In a statement, the Watford, England-based firm said the revision reflects the "prolonged impact of the inflationary environment" as well as supply constraints.
However, Smith & Nephew maintained its outlook for 2022 revenue, adding that it expects sales growth to be stronger in the second half of the year.
The results come as medical products manufacturers have faced a pandemic-related slowdown in elective surgeries and supply shortages linked to COVID lockdowns.
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