SNN - Smith & Nephew plc (SNN) Q1 2024 Sales/Trading Statement Call Transcript
2024-05-01 15:14:09 ET
Smith & Nephew plc (SNN)
Q1 2024 Sales/Trading Statement Conference Call
May 01, 2024 03:30 AM ET
Company Participants
Deepak Nath - Chief Executive Officer
John Rogers - Chief Financial Officer
Conference Call Participants
Jack Reynolds-Clark - RBC Capital Markets
Caitlin Cronin - Canaccord Genuity
Hassan Al-Wakeel - Barclays
Julien Dormois - Jefferies
Veronika Dubajova - Citi
Dylan Van Haaftan - Stifel
David Adlington - JPMorgan
Sezgi Ozener - HSBC
Presentation
Deepak Nath
Good morning, and welcome to the Smith & Nephew Q1 2024 Results Presentation. As mentioned, I'm Deepak Nath. I'm the Chief Executive Officer. And joining me for his first set of company results is our new Chief Financial Officer, John Rogers.
Underlying revenue growth was in line with our expected phasing for 2024 with mid-single-digit growth from Orthopaedics and Sports Medicine & ENT was partially offset by Advanced Wound Management. As we guided in February, our overall performance reflects tough US comparators from the stronger environment for elective procedures that we saw in Q1 of 2023. The expected quarterly volatility in SANTYL and one less trading day.
In Orthopaedics, despite the headwinds mentioned, Q1 revenue growth of 4.4% was actually ahead of the prior year's 3.9%. This is a result of strong growth in Trauma & Extremities, OUS, Knees and Hips and other recon and that was partially offset by weakness in US Knees and Hips. In US Recon, we're addressing the product supply and commercial execution challenges that have held us back. And with strengthened leadership, significant strides in capital availability improved customer service and with changes to our sales force structure delivering better execution, we expect to start to see an improving performance in US Recon.
Sports Medicine & ENT achieved mid-single-digit growth in the quarter. And while China remains a headwind, Sports Medicine Joint Repair delivered a robust performance. This was supported by prior year product launches and further market penetration of our bioactive implant REGENETEN which remains a key driver of growth.
I've mentioned SANTYL's impact on Q1. For the rest of Advanced Wound Management, trading in Advanced Wound Care and Advanced Wound Devices was in line with our expectations with our single-use PICO device continuing to drive strong growth across negative pressure wound therapy. So for the remainder of the year, we expect continued growth in Orthopaedics and Sports Medicine & ENT despite the continued headwind of China VBP and for Advanced Wound Management to return to growth. All of this underpins our confidence in maintaining our guidance for the full year.
So I'll now pass you on to John to go through the detail of today's results, before I come back to discuss our strategic progress. John?
John Rogers
Good morning, everyone. And thank you, Deepak. Turning to our revenue performance in Q1. So revenue in the quarter was $1.4 billion with 2.9% underlying growth 2.2% reported after a 70-basis-point headwind from foreign exchange. One less trading day mathematically represents about 1.5% headwind to growth and this impacts our surgical business actually more than our wound business, which is wholesalers in the channel. Geographically, our Established Markets grew by 1.3% with the US down 0.6% due to the factors Deepak has just touched upon. And revenue from our Other Established Markets grew by 4.8%. Business performance in our Emerging Markets delivered strong growth of 11.6% driven by double-digit growth in Orthopaedics....
Smith & Nephew plc (SNN) Q1 2024 Sales/Trading Statement Call Transcript