Latest news with #DeepakNath
Times
6 days ago
- Business
- Times
Smith & Nephew launches $500m buyback after profit rise
A FTSE 100 medical equipment manufacturer has launched a $500 million share buyback after reporting sales growth ahead of expectations. Smith & Nephew will start the buyback in the second half of the year as it reported that revenues for the second quarter rose 7.8 per cent to $1.55 billion, helping lift its shares 165p or 14 per cent to £13.19 in afternoon trading. Revenues for the half-year were up 4.7 per cent to $2.96 billion, with profit before tax rising 43 per cent to $362 million. Cevian Capital emerged as an activist investor in Smith & Nephew last July and stated that the group owned 'fundamentally attractive businesses' but needed to 'realise this potential' of its business portfolio. The activist investor, which is backed by the American billionaire Carl Icahn, has been increasing its holdings held through a Jersey-based vehicle and owns a stake of 8.5 per cent. The Swedish firm is known for running campaigns at a number of large listed groups in Europe, including Aviva, Pearson and Volvo. Smith & Nephew traces its roots to a chemist shop that opened in Kingston upon Hull in 1856. The company, based in Watford, Hertfordshire, now operates wound care and sports medicine businesses, and is setting up a research and development facility in Hull. The business operates in about a hundred countries and employs about 17,000 people. Deepak Nath, chief executive of Smith & Nephew, said the operational improvements put in place at the group were 'increasingly translating into better financial performance'. Nath has been implementing a three-year turnaround plan at the group after becoming chief executive in April 2022. Smith & Nephew had been facing challenges with its orthopaedics business, which is the biggest driver of revenues, but had been been weighed down by slower demand for hip and knee implants from Chinese consumers. In the interim results statement, Smith & Nephew said it was seeing a 'weakening of the headwinds from China'. The orthopaedics division saw revenues increase by 5.8 per cent to $615 million over the six months to June 28. Revenues in the sports medicine division increased by 6.8 per cent to $479 million, while revenues in the advanced wound management business were up 11.4 per cent to $459 million. Nath said: 'We are delivering sustained higher revenues growth, increased profitability and better cash generation. As expected, revenue growth accelerated in the second quarter, with all regions and business units contributing. 'We are on track for our full-year revenue growth target, a significant step-up in profitability and strong free-cash generation, and are announcing a $500 million share buyback. There is more to be done, but the transformation of Smith & Nephew is starting to deliver substantial value.' City analysts were expecting underlying revenue growth of about 4.5 per cent for the second quarter, and the group delivered underlying revenue growth, which reports revenues adjusted for currency exchange effects and the impacts of acquisitions and disposals effect, of 6.7 per cent.
Reuters
7 days ago
- Business
- Reuters
Medical products maker Smith+Nephew soars as turnaround plan boosts profit
Aug 5 (Reuters) - Smith+Nephew's (SN.L), opens new tab turnaround efforts helped the medical products maker beat first-half profit expectations on Tuesday, prompting the launch of a $500 million share buyback programme for the second half, sending its shares up more than 15%. The British group, which makes orthopaedic implants, wound dressings and other surgical aids, has been cutting costs and launching products in a recovery led by elective surgeries in the U.S., its biggest market, offsetting a challenging Chinese market. "The operational improvements we have made under the 12-Point Plan are increasingly translating into better financial performance," said Chief Executive Deepak Nath. All of Smith+Nephew's businesses grew faster in the second quarter than in the first, with underlying revenue growth of 5% or more. The company also maintained its 2025 outlook, including an impact of $15 million to $20 million from U.S. tariffs. Smith+Nephew's tariff mitigation plans included the adjustment of product flow within its manufacturing network, though it has no plans for any significant shift in manufacturing locations, CEO Nath told Reuters. "What I am not talking about is building new factories in one place versus another. That is quite a bit more complicated in a highly regulated business like healthcare," he said. Most of Smith+Nephew's manufacturing bases are in the U.S., accounting for about two thirds of products sold by the company in the country. It also has plants in the UK, Switzerland, Costa Rica, Malaysia and China. The bulk of tariff impact is expected in the second half, finance chief John Rogers told analysts. The company's shares were up almost 16% at 1115 GMT, the biggest percentage rise on Britain's blue-chip index (.FTSE), opens new tab and on track for their biggest daily gain since March 2020. Jefferies analysts welcomed the buyback plan, adding that Smith+Nephew "seems like a relative safe haven" thanks to its limited exposure to the wider economic backdrop and its "appealing valuation". Nath also said that Smith+Nephew was committed to operating all of its businesses in the face of pressure from some investors for the group to be broken up. A first-half trading profit of $523 million beat an average estimate of $496 million in a poll of analysts by the company while revenue of $2.96 billion exceeded expectations of $2.93 billion.
Reuters
7 days ago
- Business
- Reuters
Medical products maker Smith+Nephew soars as turnaround efforts boost profits
Aug 5 (Reuters) - Smith+Nephew's (SN.L), opens new tab turnaround plan helped the medical products maker beat first-half profit estimates on Tuesday, and prompted it to launch a $500-million share buyback programme for the second half, sending its shares more than 15% higher. The British company, which makes orthopaedic implants, wound dressings and other surgical aids, has been cutting costs and launching products amid a recovery in its biggest market, the United States, offseting weaker demand in China. Its businesses grew faster in the second quarter than in the first. Underlying revenues rose 5% at its orthopaedics business, 5.7% at its sports medicine and ear, nose and throat business and 10.2% in wound management. "The operational improvements we have made under the 12-Point Plan are increasingly translating into better financial performance," CEO Deepak Nath said. Smith+Nephew shares were up 15.3% at 0810 GMT, the biggest percentage rise on Britain's blue-chip index (.FTSE), opens new tab and headed for their best day since March 2020. The company is benefiting from an increase in consumers taking more elective surgeries across key markets, excluding China, where weaker demand and a bulk-buying programme is weighing on its margins and volumes. Smith+Nephew maintained its full-year outlook and forecast higher margin growth in the second half of the year. It continues to expect an impact of $15 million to $20 million from tariffs. The bulk of that impact is expected in the second half, finance chief John Rogers said on an analyst call. Jefferies analysts welcomed the buyback plan, adding that Smith+Nephew "seems like a relative safe haven," thanks to its limited exposure to economic headwinds and "appealing valuation". Smith+Nephew said last November it was on the right course after a report that three major investors were pushing for a break-up of the company. It posted a trading profit on Tuesday of $523 million for the six months to June 28, beating analysts' average estimate of $496 million, according to a company-compiled poll. Revenue of $2.96 billion was also above expectations of $2.93 billion.
New Straits Times
7 days ago
- Business
- New Straits Times
UK's Smith+Nephew launches US$500mil buyback after first-half profit beat
KUALA LUMPUR: British medical products maker Smith+Nephew announced on Tuesday a $500-million share buyback for the second half, after reporting a better-than-expected 11.2 per cent growth in first-half profit, as its turnaround plan begins to show results. Shares of Smith+Nephew jumped 14 per cent in early trading. The company, which makes orthopaedic implants, wound dressings and other surgical aids, has been aggressively cutting costs and launching products amid a recovery in its biggest market, the United States, offseting weaker demand in China. Smith+Nephew's orthopaedics segment reported 5 per cent underlying revenue growth in the second quarter, while its Sports Medicine & ENT business grew 5.7 per cent and Advanced Wound Management unit saw a 10.2 per cent rise. "The operational improvements we have made under the 12-Point Plan are increasingly translating into better financial performance," CEO Deepak Nath said in a statement. The London-based company is benefiting from a rise in consumers taking more elective surgeries across key markets, excluding China, where demand headwinds and a bulk-buying programme is weighing on its margins and volumes. Still, Smith+Nephew maintained its full-year outlook and expects higher margin growth in the second half of the year. It continues to expect an impact of US$15 million to US$20 million from tariffs. It posted a trading profit of US$523 million for the six-month period ended June 28, beating analysts' estimates of US$496 million, according to a company-compiled consensus.
Reuters
7 days ago
- Business
- Reuters
UK's Smith+Nephew launches $500-million buyback after first-half profit beat
Aug 5 (Reuters) - British medical products maker Smith+Nephew (SN.L), opens new tab announced on Tuesday a $500-million share buyback for the second half, after reporting a better-than-expected 11.2% growth in first-half profit, as its turnaround plan begins to show results. Shares of Smith+Nephew jumped 14% in early trading. The company, which makes orthopaedic implants, wound dressings and other surgical aids, has been aggressively cutting costs and launching products amid a recovery in its biggest market, the United States, offseting weaker demand in China. Smith+Nephew's orthopaedics segment reported 5% underlying revenue growth in the second quarter, while its Sports Medicine & ENT business grew 5.7% and Advanced Wound Management unit saw a 10.2% rise. "The operational improvements we have made under the 12-Point Plan are increasingly translating into better financial performance," CEO Deepak Nath said in a statement. The London-based company is benefiting from a rise in consumers taking more elective surgeries across key markets, excluding China, where demand headwinds and a bulk-buying programme is weighing on its margins and volumes. Still, Smith+Nephew maintained its full-year outlook and expects higher margin growth in the second half of the year. It continues to expect an impact of $15 million to $20 million from tariffs. It posted a trading profit of $523 million for the six-month period ended June 28, beating analysts' estimates of $496 million, according to a company-compiled consensus.
