Smith & Nephew Plc · LSE:SN.
Smith & Nephew — Q3 2023 Earnings Presentation
17 slides from Smith & Nephew's earnings presentation, Nov 2, 2023
Slide 1: Third Quarter 2023
Third Quarter 2023
Slide 2: Forward looking statements and non-IFRS measures
Forward looking statements and non-IFRS measures This document may contain forward-looking statements that may or may not prove accurate. For example, statements regarding expected revenue growth and trading profit margins, market trends and our product pipeline are forward-looking statements. Phras
Slide 3: Summary
Summary Strong momentum continued in Q3 • Ortho step up in growth, as expected • Good underlying performance in Sports and AWM 12-Point Plan continuing to advance • Improved product availability across business units • Operational KPI progress translating into better revenue growth Refining 2023 gui
Slide 4: Q3 2023 revenue
Q3 2023 revenue 4
Slide 5: Q3 2023: Broad-based growth across businesses and regions
Business unit growth Group 7.7% Orthopaedics Q3 2023: $536m 8.3% Broad-based Sports Med & ENT $425m 11.1% growth across AWM 3.6% $396m businesses and regions Geographical growth $1,357m: +7.7% underlying*, Group 7.7% +8.5% reported US 7.2% $719m Other Established Markets 7.8% $385m Emerging Markets
Slide 6: Orthopaedics
Orthopaedics Revenue ($m) +8.3% $536m: +8.3% underlying*, $492m $536m +8.8% reported +10.4% 143 128 +58.5% 29 18 Knees: US -1.3%, OUS +15.2% 141 136 +3.5% Hips: US +3.6%, OUS +3.4% 210 +5.7% 223 Q3'22 Q3'23 Knees Hips Other Recon** T&E Q3 sales factors Future drivers • Hips and Knees include return
Slide 7: US Ortho: Product availability, set deployments enabling T&E growth
US Ortho: Product availability, set deployments enabling T&E growth; Recon earlier on the same path EVOS Large set deployments ($) Q3: 10.4% T&E growth Orthopaedics US non-set LIFR*(%) Acceleration followed from Target higher set shipments Dec 22 Mar 23 Jun 23 Sep 23 >400% increase in sets deployed
Slide 8: Sports Medicine & ENT
Sports Medicine Revenue ($m) & ENT +11.1% $425m: +11.1% underlying*, $382m $425m +11.3% reported 59 42 +40.2% +1.7% 134 131 +11.3% 232 209 Q3'22 Q3'23 SMJR AET ENT Q3 sales factors Future drivers ◊ • Strong growth across Sports categories; product availability improving • REGENETEN region and indica
Slide 9: Advanced Wound Management
Advanced Wound Revenue ($m) Management $396m: +3.6% underlying*, +3.6% $396m +5.4% reported $376m 67 +21.3% 83 136 -4.8% 130 173 +3.2% 183 Q3'22 Q3'23 AWC AWB AWD Q3 sales factors Future drivers • AWC growth driven by strong quarter in Europe • Ongoing focus on commercial execution and • ◊ value dem
Slide 10: 2023 outlook
2023 outlook • Revenue growth expected towards the higher end of the 6-7% guidance range • Stronger finish expected in AWM; Orthopaedics maintaining momentum • Slower Q4 in Sports Medicine growth due to China • Trading margin now expected to be around 17.5% • H2 uplift coming through from seasonalit
Slide 11: Summary
Summary Strong momentum continued in Q3 • Ortho step change in growth, as expected • Good underlying performance in Sports and AWM 12-Point Plan continuing to advance • Improved product availability across business units • Operational KPI progress translating into better revenue growth Refining 2023
Slide 12: Appendices
Appendices 12
Slide 13: Technical guidance
Technical guidance October 2023 Foreign exchange and acquisitions Translational FX impact on revenue growth(1) c. (1.0)% Acquisition impact on revenue growth - Non-trading items Restructuring costs c. $180-190m Acquisition and integration (credit) $(10-15)m European Medical Device Regulation (MDR) $
Slide 14: Q3 consolidated revenue analysis
Q3 consolidated revenue analysis Q3 Q3 Reported Underlying Acquisitions/ Currency 2023 2022 Growth growth disposals impact Consolidated revenue by business $m $m % % % % unit Orthopaedics 536 492 8.8% 8.3% - 0.5% Knee Implants 223 210 6.3% 5.7% - 0.6% Hip Implants 141 136 3.5% 3.5% - 0.0% Other Reco
Slide 15: Business unit revenue analysis
Business unit revenue analysis 2022 2023 Full Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Year Growth Growth Growth Growth Growth Growth Growth Revenue Growth % % % % % % % $m % Orthopaedics 2.6 (1.1) 2.1 4.1 1.9 3.9 5.8 8.3 536 Knee Implants 12.2 2.7 7.4 5.5 6.8 5.0 7.8 5.7 223 Hip Implants (0.7) (3.7) (1.0) 4.9 (0.2)
Slide 16: Regional revenue analysis
Regional revenue analysis 2022 2023 Q1 Q2 Q3 Q4 Full Year Q1 Q2 Q3 Q3 Growth Growth Growth Growth Growth Growth Growth Growth Revenue % % % % % % % % $m US 3.1 2.0 6.0 4.8 4.0 11.8 6.3 7.2 719 Other Established Markets(1) 5.9 0.0 0.4 7.3 3.3 7.0 8.5 7.8 385 Established Markets 4.1 1.2 3.9 5.7 3.7 10
Slide 17: Trading days per quarter
Trading days per quarter Q1 Q2 Q3 Q4 Full year 2019 63 63 63 62 251 2020 62 63 63 64 252 2021 64 64 63 60 251 2022 64 63 63 60 250 2023 64 63 63 60 250 2024 63 64 63 62 252 17