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Smith & Nephew PLC on Tuesday claimed its transformation was starting to deliver substantial value, as it said revenue growth accelerated in the second quarter of 2025. The Watford, England-based medical devices maker said pretax profit jumped 43% to $362 million in the half year that ended June 28 from $253 million a year prior. Revenue increased 4.7% to $2.96 billion in the half year from $2.83 billion a year ago, including a $1.55 billion contribution in the second quarter, up 7.8% from $1.44 billion last year. Basic earnings per share grew 37% to 33.5 pence from 24.5p in the half year. Chief Executive Officer Deepak Nath called it a ‘strong performance’. ‘Recent product launches are driving growth across all business units,’ he said, adding the operational improvements ‘we have made under the 12-Point Plan are increasingly translating into better financial performance.’ The transformation of Smith & Nephew is starting to deliver ‘substantial value,’ Nath added. In response, shares in Smith & Nephew leapt 16% to 1,335.23 pence each in London on Tuesday morning. It was the best performing stock on the FTSE 100 index, which was up 0.3%. The 12 point plan was launched in July 2022 and aimed to ‘fundamentally change the way Smith & Nephew operates’. Smith & Nephew said underlying revenue growth accelerated to 6.7% in the second quarter, compared to 5.0% for the half year as whole. Reported growth of 7.8% included a 110 basis points foreign exchange tailwind, the firm explained. All regions and all the three business units grew ahead of the first quarter, Smith & Nephew said. Orthopaedics underlying revenue growth was 5.0% with both Global and US Reconstruction sequentially improving from the first quarter. Sports Medicine & Ears, Nose and Throat underlying revenue growth was 5.7%, and 10% excluding China. Advanced Wound Management underlying revenue growth was 10%, including a rebound in Advanced Wound Bioactives. The company raised its interim dividend by 4.2% to 15.0 US cents from 14.4 cents a year ago and announced a $500 million share buyback. The buyback starts on Tuesday and will be completed by December 31. Smith & Nephew picked JP Morgan Securities PLC to run the buyback. The repurchased shares will be held in treasury to satisfying awards under employee share plans or cancelled. The cash dividend and share buyback reflect strong cash generation and balance sheet, Smith & Nephew said. Smith & Nephew left full-year guidance unchanged, expecting underlying revenue growth to be around 5.0%, with reported growth 5.5%. Trading profit margin is expected to expand to between 19.0% and 20.0%. In 2024, Smith & Nephew reported revenue of $5.81 billion and a trading profit margin of 18.1%. The ‘continued higher cadence of product launches and clinical evidence to underpin further growth’, S&N said. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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