25 March 2019

Re-presented Historical Quarterly Revenue Analysis

25 March 2019

Smith & Nephew plc (LSE:SN, NYSE:SNN) has updated its revenue reporting in line with its previously announced new commercial structure.

From 1 January 2019 the Group will report quarterly revenue for three global franchises of Orthopaedics, Sports Medicine & ENT, and Advanced Wound Management, replacing the previous franchise structure. The Group’s revenue reporting by geography is unchanged.

Included within Orthopaedics are the following businesses:

Included within Sports Medicine & ENT are the following businesses:

Advanced Wound Management is unchanged, and includes the following businesses:

Reporting by geography is unchanged, as follows:

The updated reporting approach is in line with International Financial Reporting Standard (IFRS) 8 Operating Segments that require companies’ segment reporting to reflect the way in which performance is monitored, operating decisions are made and resources are allocated.

In order to assist future comparability with historical data, Smith & Nephew has set out below quarterly and full year revenue under the new structure for 2018 and 2017. There has been no change in total revenue for any period presented.

Enquiries

Investors

 

Andrew Swift, Smith & Nephew

+44 (0) 20 7960 2285

 

 

Media

 

Charles Reynolds, Smith & Nephew

+44 (0) 1923 477314

 

 

Ben Atwell / Andrew Ward, FTI Consulting

+44 (0) 20 3727 1000

Notes

Unless otherwise specified as ‘reported’ all revenue growth throughout this document is ‘underlying’ after adjusting for the effects of currency translation and including the comparative impact of acquisitions and excluding disposals. All percentages compare to the equivalent 2017 period.

Underlying revenue growth is used to compare the revenue in a given period to the comparative period on a like-for-like basis. Underlying revenue growth reconciles to reported revenue growth, the most directly comparable financial measure calculated in accordance with IFRS, by making adjustments for the effect of acquisitions and disposals and the impact of movements in exchange rates (currency impact), as described below.

The effect of acquisitions and disposals measures the impact on revenue from newly acquired business combinations and recent business disposals. This is calculated by comparing the current year, constant currency actual revenue (which include acquisitions and exclude disposals from the relevant date of completion) with prior year, constant currency actual revenue, adjusted to include the results of acquisitions and exclude disposals for the commensurate period in the prior year.

The ‘constant currency exchange effect’ is a measure of the increase/decrease in revenue resulting from currency movements on non-US Dollar sales and is measured as the difference between: 1) the increase/decrease in the current year revenue translated into US Dollars at the current year average exchange rate and the prior revenue translated at the prior year rate; and 2) the increase/decrease being measured by translating current and prior year revenues into US Dollars using the prior year closing rate.

About Smith & Nephew

Smith & Nephew is a portfolio medical technology business with leadership positions in Orthopaedics, Advanced Wound Management and Sports Medicine. Smith & Nephew has more than 16,000 employees and a presence in more than 100 countries. Annual sales in 2018 were $4.9 billion. Smith & Nephew is a member of the FTSE100 (LSE:SN, NYSE:SNN). For more information about Smith & Nephew, please visit our corporate website www.smith-nephew.com and follow us on Twitter, LinkedIn or Facebook.

Forward-looking Statements

This document may contain forward-looking statements that may or may not prove accurate. For example, statements regarding expected revenue growth and trading margins, market trends and our product pipeline are forward-looking statements. Phrases such as "aim", "plan", "intend", "anticipate", "well-placed", "believe", "estimate", "expect", "target", "consider" and similar expressions are generally intended to identify forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results to differ materially from what is expressed or implied by the statements. For Smith & Nephew, these factors include: economic and financial conditions in the markets we serve, especially those affecting health care providers, payers and customers; price levels for established and innovative medical devices; developments in medical technology; regulatory approvals, reimbursement decisions or other government actions; product defects or recalls or other problems with quality management systems or failure to comply with related regulations; litigation relating to patent or other claims; legal compliance risks and related investigative, remedial or enforcement actions; disruption to our supply chain or operations or those of our suppliers; competition for qualified personnel; strategic actions, including acquisitions and dispositions, our success in performing due diligence, valuing and integrating acquired businesses; disruption that may result from transactions or other changes we make in our business plans or organisation to adapt to market developments; and numerous other matters that affect us or our markets, including those of a political, economic, business, competitive or reputational nature. Please refer to the documents that Smith & Nephew has filed with the U.S. Securities and Exchange Commission under the U.S. Securities Exchange Act of 1934, as amended, including Smith & Nephew's most recent annual report on Form 20-F, for a discussion of certain of these factors. Any forward-looking statement is based on information available to Smith & Nephew as of the date of the statement. All written or oral forward-looking statements attributable to Smith & Nephew are qualified by this caution. Smith & Nephew does not undertake any obligation to update or revise any forward-looking statement to reflect any change in circumstances or in Smith & Nephew's expectations.

◊Trademark of Smith & Nephew. Certain marks registered US Patent and Trademark Office.

Smith & Nephew Re-presented 2018 Results

First Quarter 2018 Consolidated Re-presented Revenue Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

31 March 

 

1 April

 

Reported 

 

Underlying 

 

Acquisitions 

 

Currency 

 

 

2018 

 

2017 

 

growth 

 

Growth(i) 

 

/disposals 

 

impact 

Consolidated revenue by franchise

    

$m 

    

$m 

    

    

    

    

Orthopaedics

 

 544

 

 522

 

 4

 

 -

 

 -

 

 4

Knee Implants

 

 259

 

 244

 

 6

 

 2

 

 -

 

 4

Hip Implants

 

 155

 

 152

 

 2

 

  -2 

 

 -

 

 4

Other Reconstruction

 

 13

 

 10

 

 34

 

 30

 

 -

 

 4

Trauma

 

 117

 

 116

 

 1

 

  -2 

 

 -

 

 3

 

 

 

 

 

 

 

 

 

 

 

 

 

Sports Medicine & ENT

 

 362

 

 340

 

 6

 

 1

 

 1

 

 4

Sports Medicine Joint Repair

 

 175

 

 155

 

 12

 

 5

 

 2

 

 5

Arthroscopic Enabling Technologies

 

 152

 

 153

 

 -

 

  -5 

 

 -

 

 5

ENT

 

 35

 

 32

 

 9

 

 6

 

 -

 

 3

 

 

 

 

 

 

 

 

 

 

 

 

 

Advanced Wound Management

 

 290

 

 280

 

 4

 

  -2 

 

 -

 

 6

Advanced Wound Care

 

 183

 

 170

 

 8

 

 -

 

 -

 

 8

Advanced Wound Bioactives

 

 59

 

 66

 

  -11 

 

  -12 

 

 -

 

 1

Advanced Wound Devices

 

 48

 

 44

 

 10

 

 2

 

 -

 

 8

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 1,196

 

 1,142

 

 5

 

 -

 

 -

 

 5

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated revenue by geography

 

 

 

 

 

 

 

 

 

 

 

 

US

 

 545

 

 555

 

  -2 

 

  -2 

 

 -

 

-

Other Established Markets(ii)

 

 446

 

 409

 

 9

 

  -2 

 

 -

 

 11

Total Established Markets

 

 991

 

 964

 

 3

 

  -2 

 

 -

 

 5

Emerging Markets

 

 205

 

 178

 

 15

 

 9

 

 -

 

 6

Total

 

 1,196

 

 1,142

 

 5

 

 -

 

 -

 

 5

(i)    Underlying growth is defined in the Notes on page 2

(ii)   Other Established Markets are Australia, Canada, Europe, Japan and New Zealand

Second Quarter 2018 Consolidated Re-presented Revenue Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30 June 

 

1 July 

 

Reported 

 

Underlying 

 

Acquisitions 

 

Currency 

 

 

2018 

 

2017 

 

growth 

 

Growth(i) 

 

/disposals 

 

impact 

Consolidated revenue by franchise

    

$m 

    

$m 

    

    

    

    

Orthopaedics

 

 548

 

 531

 

 3

 

 1

 

 -

 

 2

Knee Implants

 

 258

 

 246

 

 5

 

 3

 

 -

 

 2

Hip Implants

 

 156

 

 150

 

 4

 

 1

 

 -

 

 3

Other Reconstruction

 

 16

 

 13

 

 28

 

 27

 

 -

 

 1

Trauma

 

 118

 

 122

 

  -4 

 

  -5 

 

 -

 

 1

 

 

 

 

 

 

 

 

 

 

 

 

 

Sports Medicine & ENT

 

 368

 

 345

 

 7

 

 3

 

 2

 

 2

Sports Medicine Joint Repair

 

 177

 

 159

 

 12

 

 7

 

 3

 

 2

Arthroscopic Enabling Technologies

 

 153

 

 151

 

 1

 

  -1 

 

 -

 

 2

ENT

 

 38

 

 35

 

 7

 

 5

 

 -

 

 2

 

 

 

 

 

 

 

 

 

 

 

 

 

Advanced Wound Management

 

 329

 

 318

 

 4

 

 1

 

 -

 

 3

Advanced Wound Care

 

 187

 

 177

 

 6

 

 2

 

 -

 

 4

Advanced Wound Bioactives

 

 87

 

 92

 

  -5 

 

  -6 

 

 -

 

 1

Advanced Wound Devices

 

 55

 

 49

 

 12

 

 9

 

 -

 

 3

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 1,245

 

 1,194

 

 4

 

 2

 

 -

 

 2

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated revenue by geography

 

 

 

 

 

 

 

 

 

 

 

 

US

 

 590

 

 582

 

 1

 

 1

 

 -

 

-

Other Established Markets(ii)

 

 429

 

 403

 

 6

 

 1

 

 -

 

 5

Total Established Markets

 

 1,019

 

 985

 

 3

 

 1

 

 -

 

 2

Emerging Markets

 

 226

 

 209

 

 8

 

 6

 

 -

 

 2

Total

 

 1,245

 

 1,194

 

 4

 

 2

 

 -

 

 2

(i)    Underlying growth is defined in the Notes on page 2

(ii)   Other Established Markets are Australia, Canada, Europe, Japan and New Zealand

Third Quarter 2018 Consolidated Re-presented Revenue Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

29 September 

 

30 September 

 

Reported 

 

Underlying 

 

Acquisitions 

 

Currency 

 

 

2018 

 

2017 

 

growth 

 

Growth(i) 

 

/disposals 

 

impact 

Consolidated revenue by franchise

    

$m 

    

$m 

    

    

    

    

Orthopaedics

 

 505

 

 494

 

 2

 

 5

 

 -

 

  -3 

Knee Implants

 

 232

 

 228

 

 1

 

 4

 

 -

 

  -3 

Hip Implants

 

 142

 

 140

 

 2

 

 4

 

 -

 

  -2 

Other Reconstruction

 

 13

 

 10

 

 37

 

 43

 

 -

 

  -6 

Trauma

 

 118

 

 116

 

 2

 

 3

 

 -

 

  -1 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sports Medicine & ENT

 

 345

 

 336

 

 3

 

 3

 

 2

 

  -2 

Sports Medicine Joint Repair

 

 171

 

 157

 

 9

 

 8

 

 3

 

  -2 

Arthroscopic Enabling Technologies

 

 138

 

 144

 

  -4 

 

  -2 

 

 -

 

  -2 

ENT

 

 36

 

 35

 

 3

 

 5

 

 -

 

  -2 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advanced Wound Management

 

 319

 

 322

 

  -1 

 

 1

 

 -

 

  -2 

Advanced Wound Care

 

 184

 

 186

 

  -1 

 

 1

 

 -

 

  -2 

Advanced Wound Bioactives

 

 81

 

 86

 

  -7 

 

  -7 

 

 -

 

 -

Advanced Wound Devices

 

 54

 

 50

 

 9

 

 11

 

 -

 

  -2 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 1,169

 

 1,152

 

 2

 

 3

 

 -

 

  -1 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Consolidated revenue by geography

 

 

 

 

 

 

 

 

 

 

 

US

 

 569

 

 545

 

 4

 

 4

 

 -

 

-

Other Established Markets(ii)

 

 393

 

 407

 

  -3 

 

  -1 

 

 -

 

  -2 

Total Established Markets

 

 962

 

 952

 

 1

 

 2

 

 -

 

  -1 

Emerging Markets

 

 207

 

 200

 

 4

 

 10

 

 -

 

  -6 

Total

 

 1,169

 

 1,152

 

 2

 

 3

 

 -

 

  -1 

                           

(i)    Underlying growth is defined in the Notes on page 2

(ii)   Other Established Markets are Australia, Canada, Europe, Japan and New Zealand

Fourth Quarter 2018 Consolidated Re-presented Revenue Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

31 December 

 

31 December 

 

Reported 

 

Underlying 

 

Acquisitions 

 

Currency 

 

 

2018 

 

2017 

 

growth 

 

Growth(i) 

 

/disposals 

 

impact 

Consolidated revenue by franchise

    

$m 

    

$m 

    

    

    

    

Orthopaedics

 

 571

 

 560

 

 2

 

 4

 

 -

 

  -2 

Knee Implants

 

 269

 

 266

 

 1

 

 3

 

 -

 

  -2 

Hip Implants

 

 160

 

 157

 

 2

 

 4

 

 -

 

  -2 

Other Reconstruction

 

 19

 

 13

 

 43

 

 45

 

 -

 

  -2 

Trauma

 

 123

 

 124

 

  -1 

 

 1

 

 -

 

  -2 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sports Medicine & ENT

 

 386

 

 382

 

 1

 

 2

 

 1

 

  -2 

Sports Medicine Joint Repair

 

 193

 

 179

 

 8

 

 8

 

 2

 

  -2 

Arthroscopic Enabling Technologies

 

 157

 

 167

 

  -6 

 

  -4 

 

 -

 

  -2 

ENT

 

 36

 

 36

 

 1

 

 3

 

 -

 

  -2 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advanced Wound Management

 

 337

 

 336

 

 -

 

 2

 

 -

 

  -2 

Advanced Wound Care

 

 185

 

 187

 

  -1 

 

 2

 

 -

 

  -3 

Advanced Wound Bioactives

 

 94

 

 97

 

  -3 

 

  -3 

 

 -

 

 -

Advanced Wound Devices

 

 58

 

 52

 

 11

 

 14

 

 -

 

  -3 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 1,294

 

 1,278

 

 1

 

 3

 

 -

 

  -2 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Consolidated revenue by geography

 

 

 

 

 

 

 

 

 

 

 

US

 

 649

 

 624

 

 4

 

 3

 

 1

 

-

Other Established Markets(ii)

 

 427

 

 439

 

  -3 

 

 -

 

 -

 

  -3 

Total Established Markets

 

 1,076

 

 1,063

 

 1

 

 2

 

 -

 

  -1 

Emerging Markets

 

 218

 

 215

 

 2

 

 8

 

 -

 

  -6 

Total

 

 1,294

 

 1,278

 

 1

 

 3

 

 -

 

  -2 

(i)    Underlying growth is defined in the Notes on page 2

(ii)   Other Established Markets are Australia, Canada, Europe, Japan and New Zealand

Full Year 2018 Consolidated Re-presented Revenue Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

31 December 

 

31 December 

 

Reported 

 

Underlying 

 

Acquisitions 

 

Currency 

 

 

2018 

 

2017 

 

growth 

 

Growth(i) 

 

/disposals 

 

impact 

Consolidated revenue by franchise

    

$m 

    

$m 

    

    

    

    

Orthopaedics

 

 2,168

 

 2,107

 

 3

 

 3

 

 -

 

-

Knee Implants

 

 1,017

 

 984

 

 3

 

 3

 

 -

 

-

Hip Implants

 

 613

 

 599

 

 2

 

 2

 

 -

 

-

Other Reconstruction

 

 62

 

 45

 

 36

 

 36

 

 -

 

-

Trauma

 

 476

 

 479

 

 -

 

  -1 

 

 -

 

 1

 

 

 

 

 

 

 

 

 

 

 

 

 

Sports Medicine & ENT

 

 1,461

 

 1,402

 

 4

 

 2

 

 2

 

-

Sports Medicine Joint Repair

 

 717

 

 650

 

 10

 

 7

 

 2

 

 1

Arthroscopic Enabling Technologies

 

 600

 

 615

 

  -2 

 

  -3 

 

 -

 

 1

ENT

 

 144

 

 137

 

 5

 

 5

 

 -

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

Advanced Wound Management

 

 1,275

 

 1,256

 

 2

 

 -

 

 -

 

 2

Advanced Wound Care

 

 740

 

 720

 

 3

 

 1

 

 -

 

 2

Advanced Wound Bioactives

 

 320

 

 342

 

  -6 

 

  -6 

 

 -

 

-

Advanced Wound Devices

 

 215

 

 194

 

 10

 

 9

 

 -

 

 1

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 4,904

 

 4,765

 

 3

 

 2

 

 -

 

 1

 

 

 

 

 

 

 

 

 

 

 

 

 

  Consolidated revenue by geography

 

 

 

 

 

 

 

 

 

 

US

 

 2,354

 

 2,306

 

 2

 

 1

 

 1

 

-

Other Established Markets(ii)

 

 1,693

 

 1,658

 

 2

 

 -

 

 -

 

 2

Total Established Markets

 

 4,047

 

 3,964

 

 2

 

 1

 

 -

 

 1

Emerging Markets

 

 857

 

 801

 

 7

 

 8

 

 -

 

  -1 

Total

 

 4,904

 

 4,765

 

 3

 

 2

 

-

 

 1

(i) Underlying growth is defined in the Notes on page 2

(ii) Other Established Markets are Australia, Canada, Europe, Japan and New Zealand

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