LONDON (dpa-AFX) - Smith & Nephew Plc (SNN, SN.L), a British medical technology company, reported Wednesday higher revenues in its third quarter, with growth in all regions. Further, the company trimmed fiscal 2026 guidance to reflect slower growth than expected in Orthopaedics, which is expected to continue through the fourth quarter.
Further, regarding Orthopaedics business, the firm confirmed that it had approached Johnson & Johnson earlier in the year regarding a possible combination between Johnson & Johnson's Depuy Synthes business and Smith+Nephew. Subsequently, discussions did take place, but those conversations have now ended.
The company now said it will continue to actively explore the full range of strategic options for the business.
In the third quarter, total revenue was $1.551 billion, 3.4 percent higher than last year's $1.501 billion. On an underlying basis, revenue growth was 3.4 percent.
Total Established Markets revenues grew 2.6 percent from last year to $1.268 billion.
US revenues were $812 million, up 3 percent from last year's $789 million. Other Established Markets' revenues were $456 million, a growth of 2 percent year-over-year.
Emerging Markets revenues climbed 7 percent to $283 million.
In the nine-month period, total revenues were $4.648 billion, up 4.2 percent from last year.
Looking ahead for fiscal 2026, the company now projects revenue growth to be around 3 percent on an underlying basis, reflecting outlook for US Hips and Knees in the fourth quarter and market conditions. The previous outlook was a growth around 4 percent.
On a reported basis, the guidance equates to around 4.0 percent.
As a result of the lower revenue outlook, trading profit growth is now expected to be around 4 percent, to around $1.250 billion.
The company previously expected trading profit growth around 8 percent, with around $1.3 billion.
The company said it remains confident in delivering profit growth ahead of revenue growth, together with strong free cash flow and cash conversion.
As previously disclosed, the firm expects the net year-on-year impact of tariffs to be broadly neutral to trading profit.
The acquisition of Integrity Orthopaedics is expected to be marginally dilutive to trading profit in 2026, broadly neutral in 2027 and accretive from 2028, as previously guided.
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