Q2 Commentary - Reported revenue up 23% to USD1 billion, underlying growth up 8% (10% excluding Plus impact5)
- Reported trading profit USD198 million up 19%
- EPSA up by 13% to 14.0 cents
- Orthopaedic Reconstruction achieved revenue growth of 8% (11% excluding Plus impact) with strong contributions from both hip and knee revenues
- Orthopaedic Trauma improved with 5% revenue growth (10% excluding Plus impact). US fixation revenues improved as management actions started to deliver benefits
- Endoscopy returned to double digit revenue growth
- Advanced Wound Management outperformed the market globally and gained traction with Negative Pressure Wound Therapy
- Plus Orthopedics sales practices impact confirmed, management focused on realising acquisition benefits
Commenting on the second quarter, David Illingworth, Chief Executive of Smith & Nephew, said:"We have generated quarterly revenues of USD1 billion for the first time, as a result of a very solid performance across all of our businesses. In Reconstruction we have seen good growth in both our hip and knee product lines; in Trauma the actions we have taken in sales management have begun to pay off; Endoscopy has delivered double digit revenue growth and in Advanced Wound Management we have outperformed the market. We are confirming our guidance for the full year and we believe that the long term outlook for our business is excellent".
Analyst presentation
An analyst presentation and conference call to discuss Smith & Nephew's second quarter results will be held at 12.30pm BST /7.30am EST today, Thursday 7 August. This will be broadcast live on the company's website and will be available on demand shortly following the close of the call at http://www.smith-nephew.com/Q208. A podcast will also be available at the same address. If interested parties are unable to connect to the web, a listen-only service is available by calling +44 (0)20 7806 1957 in the UK or +1 (718) 354 1388 in the US. Analysts should contact Samantha Hardy on +44 (0)20 7960 2257 or by email at samantha.hardy@smith-nephew.com for conference details.
Notes
1 Unless otherwise specified as 'reported', all revenue increases throughout this document are underlying increases after adjusting for the effects of currency translation and acquisitions. See note 3 to the financial statements for a reconciliation of these measures to results reported under IFRS.
2 A reconciliation from operating profit to trading profit is given in note 4 to the financial statements. The underlying increase in trading profit is the increase in trading profit after adjusting for the effects of currency translation and acquisitions.
3 The underlying trading profit margin is the increase in trading profit margin after adjusting for the effects of currency translation and acquisitions. Unless specified as "reported" all trading profit margin increases throughout this document are underlying.
4 Adjusted earnings per ordinary share ("EPSA") growth is as reported, not underlying, and is stated before restructuring and rationalisation costs, acquisition related costs, amortisation of acquisition intangibles and taxation thereon. See note 2 to the financial statements.
5 Adjusted for the impact of Plus sales lost due to unacceptable sales practices in parts of Europe.
6 Operating profit for the comparative 3 months and 6 months ended 30 June 2007 have been adjusted for the finalisation of IFRS 3 acquisition accounting for Plus and BlueSky. See note 1 to the financial statements.
7 All numbers given are for the quarter ended 28 June 2008 unless stated otherwise.
Enquiries
Investors Liz Hewitt +44 (0) 20 7401 7646 Group Director Corporate Affairs Smith & Nephew
Media Jon Coles +44 (0) 20 7404 5959 Justine McIlroy Brunswick - London
Cindy Leggett-Flynn +1 (212) 333 3810 Brunswick - New York
Click on, or paste the following link into your web browser, to view the associated PDF document.
http://www.rns-pdf.londonstockexchange.com/rns/8187A_1-2008-8-6.pdf
Contact: Contacts: RNS Customer Services 0044-207797-4400 Email Contact http://www.rns.com
Source: Smith & Nephew Plc
