|
Smith & Nephew PLC on Thursday raised its annual free cash flow outlook, but shares slumped as third quarter revenue fell short of consensus. The medical device manufacturer said revenue in the third quarter to September 27 improved 6.3% on-year to $1.50 billion from $1.41 billion. Revenue fell short of company-compiled consensus of $1.51 billion. The Watford, England-based firm achieved underlying revenue growth of 5.0%, though this was shy of consensus of a 6.2% rise. In response, shares fell 8.7% to 1,272.50 pence each in London on Thursday morning. ‘Our third quarter results again demonstrate how the 12-point plan has improved Smith & Nephew’s revenue growth profile, keeping us on track to meet our full-year outlook for revenue growth and a step-up in trading profit margin,’ Chief Executive Officer Deepak Nath said. ‘As we approach the end of the 12-point plan our business is undoubtedly in a better place. We have embedded greater accountability, faster decision making, better execution, and increased customer focus. New products are demonstrably driving higher levels of revenue growth, and our pipeline is full of further exciting innovation.’ Smith & Nephew said third quarter Orthopaedics underlying revenue rose 4.1%, or 5.1% on a reported basis. It noted ‘strong growth from US Hip Implants continuing to offset weaker US Knee Implants’. Sports Medicine & ENT underlying revenue growth was 5.1%, or 6.4% on a reported basis. There was ‘strong growth’ outside of China. Elsewhere, Advanced Wound Management revenue rose 6.0% on an underlying basis, and 7.8% on a reported basis. Smith & Nephew still expects full-year underlying revenue growth to be around 5.0%, 5.7% on a reported basis. A trading profit margin rise to between 19.0% and 20.0% is still expected, from 18.1% in 2024. It raised free cash flow guidance to around $750 million, from prior guidance of over $600 million. ‘We are pleased to be able to raise our guidance for improved free cash flow, which we now expect to be around $750 million, a more than five-fold increase since 2023,’ CEO Nath said. Copyright 2025 Alliance News Ltd. All Rights Reserved.
|
