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Smith+Nephew (LSE: SN, NYSE: SNN), a global medical technology company, reported its financial results for the second quarter and the first half ended June 29, 2024. The company demonstrated robust growth across key financial metrics, underscoring its strong market position and operational efficiency.
In Q2, Smith+Nephew achieved revenue of $1,441 million, representing a 5.6% increase compared to $1,379 million in Q2 2023. This growth includes a 100 basis points (bps) foreign exchange (FX) headwind, translating to a 4.6% increase on a reported basis.
For the first half of 2024 (H1), the company reported revenue of $2,827 million, up 4.3% compared to $2,734 million in H1 2023. On a reported basis, including a 90 bps FX headwind, revenue grew by 3.4%. The company’s operating profit for H1 rose to $328 million, a significant 19.5% increase from $275 million in the previous year. Trading profit also saw a notable rise, up 12.8% to $471 million from $417 million in H1 2023.
Improved Cash Flow and Dividend
Smith+Nephew reported a substantial improvement in cash flow generation. Cash generated from operations increased to $368 million, up from $215 million in H1 2023. The company's trading cash flow conversion rate improved significantly to 60%, with trading cash flow increasing to $284 million from $110 million in the previous year.
The company declared an interim dividend of 14.4¢, consistent with the previous year, reflecting its stable financial position and commitment to returning value to shareholders.
2024 Outlook
Smith+Nephew has maintained its 2024 guidance, expecting underlying revenue growth in the range of 5.0% to 6.0% and reported revenue growth between 4.4% and 5.4%. The company also anticipates a trading profit margin of at least 18.0%, underscoring its confidence in achieving continued operational efficiency and market expansion.
