Swiss medical device maker Synthes reported a forecast-beating 19 percent rise in first-quarter sales on Tuesday, helped by the weak dollar and a snowy winter in Europe and boosting its shares.
The maker of nails, screws and plates to fix broke bones confirmed its 2008 guidance, saying sales were likely to rise at a low double-digit percentage rate in local currencies.
Spokesman Gilgian Eisner said profit should rise faster than that rate, but the progress of Synthes' new artificial spine discs in the United States was slow because insurers remained reluctant to pay for the spine replacements.
Synthes shares, which have lost some 2 percent this year and about 15 percent since hitting a record in January 2007, rose 5 percent in early trade to 144.40 Swiss francs, outpacing a 0.6 percent rise in the European health care sector index. Synthes' sales rose to $781 million in the first-quarter, a 13 percent rise in local currencies, above the average forecast of $765 million in a Reuters poll.
"The sales figures are rock solid," analysts at bank Wegelin said in a note. "Especially the strong growth in Asia and North America will please investors." Sales in Europe increased 28 percent - 15 percent in local currencies - boosted by the strong euro and a lot of snow, which Synthes said led to an increase of weather-related accidents such as skiing injuries.
Synthes saw sales rise by 13 percent in North America, its largest market by revenue. Sales were up by one third in Asia. Synthes has a nearly 50 percent share in the trauma market, but trails US rivals DePuy and Medtronic in the spine business, which Synthes estimates at around $5.5 billion and where analysts see strong growth potential.