Smith & Nephew Shares Dive on Guidance Cut Amid China Headwinds

Dow Jones10-31

By Najat Kantouar

Smith & Nephew shares had their worst day in 37 years after the company cut its full-year guidance expectations blaming continued headwinds across its surgical businesses in China.

In mid-morning European trading, shares were down 144.40 pence, or 13.2%, at 953.60 pence, marking their worst one-day percentage fall since October 1987. Year-to-date, shares have fallen 12%.

The U.K. medical-technology company now expects underlying revenue growth for this year of around 4.5% instead of in between 5.0% and 6.0%. It also anticipates trading profit margin growth of up to 50 basis points from last year's 17.5%, having previously forecast a margin of at least 18%.

Based on its latest guidance and continued uncertainty around China, the London-listed company said it now expects trading profit margin for next year of between 19.0% and 20.0%.

For the three months ended Sept. 30 revenue rose to $1.41 billion from $1.36 billion, representing an underlying and reported growth of 4%. Excluding China, group growth was 5.9%. Company-compiled consensus had forecast revenue of $1.43 billion and underlying growth of 5.5%.

Write to Najat Kantouar at najat.kantouar@wsj.com

(END) Dow Jones Newswires

October 31, 2024 05:53 ET (09:53 GMT)

Copyright (c) 2024 Dow Jones & Company, Inc.

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