SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of
1934
March 30, 2020
Commission
File Number 001-14978
SMITH & NEPHEW
plc
(Registrant's
name)
Building 5, Croxley Park,
Hatters Lane, Watford, Hertfordshire, WD18 8YE,
England
(Address
of registrant's principal executive offices)
[Indicate
by check mark whether the registrant files or will file
annual
reports
under cover Form 20-F or Form 40-F.]
Form
20-F
X
Form 40-F
---
---
[Indicate
by check mark if the registrant is submitting the Form 6-K
in
paper
as permitted by Regulation S-T Rule 101(b)(1).]
Yes
No X
---
---
[Indicate
by check mark if the registrant is submitting the Form 6-K
in
paper
as permitted by Regulation S-T Rule 101(b)(7).]
Yes
No X
---
---
[Indicate
by check mark whether by furnishing the information
contained
in this
Form, the registrant is also thereby furnishing information to
the
Commission
pursuant to Rule 12g3-2 (b) under the Securities Exchange Act
of
1934.]
Yes
No X
---
---
If
"Yes" is marked, indicate below the file number assigned to
the
registrant
in connection with Rule 12g3-2 (b) : 82- n/a.
Statement on COVID-19 impact
30 March 2020
Smith+Nephew (LSE:SN, NYSE:SNN), the global medical technology
business, today announces that the full year financial
guidance issued on 20 February 2020, which assumed a normalisation
of the COVID-19 outbreak early in the second quarter, is
withdrawn due to the rapid expansion of the virus beyond
China.
Overall it is too early to determine the consequent impact of the
COVID-19 pandemic on our business. In China elective procedures
have restarted, but currently remain considerably below
pre-outbreak levels. In Europe and the US a range of policy
responses are now being implemented, including stopping all
but the most urgent surgical procedures. It is difficult to
determine how long the situation will last, the speed of
normalisation thereafter, and the timing of catch-up of postponed
procedures. Given this ongoing uncertainty, we will not update
2020 guidance until the effect of COVID-19 becomes
clearer.
First quarter trading results will be reported on 6 May 2020. We
expect that underlying revenue growth1 for
the first quarter will be around -8% down on the first quarter of
last year. We also expect that second quarter revenue and first
half trading margin will be substantially down on the prior
year.
In February Smith+Nephew initiated actions to realise significant
savings from areas such as travel, events, advertising, promotion
and consultancy, as well as freezing all but the most crucial new
hires and slowing some planned capital
expenditure.
Smith+Nephew has a strong balance sheet with access to significant
liquidity. As of 31 December 2019, the Group had net debt of $1.6
billion (excluding lease liabilities) compared to committed
facilities of $2.9 billion, as well as a further $550 million of
Senior Notes which will be drawn down in June 2020.
Roland Diggelmann, Chief Executive Officer of Smith+Nephew,
said:
"Our immediate focus is the well-being of employees, and to
continue to support patients and medical practitioners. We remain
actively engaged in our communities. We are supporting employees
with healthcare experience who wish to volunteer to return to front
line care and using our R&D and manufacturing expertise to
support the fight against COVID-19."
"Looking beyond the immediate future, Smith+Nephew operates in
attractive markets with excellent growth fundamentals. We are
financially strong with a proven strategy and unique portfolio. Our
major manufacturing and distribution facilities are all active and
we are ready to meet pent-up demand when the time
comes."
This announcement includes inside information as defined in Article
7 of the Market Abuse Regulation No. 596/2014.
The person responsible for arranging the release of this
announcement on behalf of Smith+Nephew is Susan Swabey, Company
Secretary.
- ends -
Enquiries
Investors
Andrew Swift
+44 (0) 1923 477433
Smith+Nephew
Media
Charles Reynolds
+44 (0) 1923 477314
Smith+Nephew
Susan Gilchrist / Ayesha Bharmal
+44 (0)
207404 5959
Brunswick
Notes
1. Unless
otherwise specified as 'reported' all revenue growth throughout
this document is 'underlying' after adjusting for the effects of
currency translation and including the comparative impact of
acquisitions and excluding disposals. All percentages compare to
the equivalent 2019 period.
'Underlying
revenue growth' reconciles to reported revenue growth, the most
directly comparable financial measure calculated in accordance with
IFRS, by making two adjustments, the 'constant currency exchange
effect' and the 'acquisitions and disposals effect', described
below.
The
'constant currency exchange effect' is a measure of the
increase/decrease in revenue resulting from currency movements on
non-US Dollar sales and is measured as the difference between: 1)
the increase/decrease in the current year revenue translated into
US Dollars at the current year average exchange rate and the prior
revenue translated at the prior year rate; and 2) the
increase/decrease being measured by translating current and prior
year revenues into US Dollars using the prior year closing
rate.
The
'acquisitions and disposals effect' is the measure of the impact on
revenue from newly acquired material business combinations and
recent material business disposals. This is calculated by comparing
the current year, constant currency actual revenue (which includes
acquisitions and excludes disposals from the relevant date of
completion) with prior year, constant currency actual revenue,
adjusted to include the results of acquisitions and exclude
disposals for the commensurate period in the prior year. These
sales are separately tracked in the Group's internal reporting
systems and are readily identifiable.
About Smith+Nephew
Smith+Nephew is a portfolio medical technology business that exists
to restore people's bodies and their self-belief by using
technology to take the limits off living. We call this purpose
'Life Unlimited'. Our 17,500+ employees deliver this mission every
day, making a difference to patients' lives through the
excellence of our product portfolio, and the invention and
application of new technologies across our three global
franchises of Orthopaedics, Advanced Wound Management and Sports
Medicine & ENT.
Founded in Hull, UK, in 1856, we now operate in more than 100
countries, and generated annual sales of $5.1 billion in 2019.
Smith+Nephew is a constituent of the FTSE100 (LSE:SN, NYSE:SNN).
The terms 'Group' and 'Smith+Nephew' are used to refer to Smith
& Nephew plc and its consolidated subsidiaries, unless the
context requires otherwise.
For more information about Smith+Nephew, please
visit www.smith-nephew.com and
follow us on Twitter, LinkedIn, Instagram or Facebook.
Forward-looking Statements
This document may contain forward-looking statements that may or
may not prove accurate. For example, statements regarding expected
revenue growth and trading margins, market trends and our product
pipeline are forward-looking statements. Phrases such as "aim",
"plan", "intend", "anticipate", "well-placed", "believe",
"estimate", "expect", "target", "consider" and similar expressions
are generally intended to identify forward-looking statements.
Forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause actual
results to differ materially from what is expressed or implied by
the statements. For Smith+Nephew, these factors include: economic
and financial conditions in the markets we serve, especially those
affecting health care providers, payers and customers; price levels
for established and innovative medical devices; developments in
medical technology; regulatory approvals, reimbursement decisions
or other government actions; product defects or recalls or other
problems with quality management systems or failure to comply with
related regulations; litigation relating to patent or other claims;
legal compliance risks and related investigative, remedial or
enforcement actions; disruption to our supply chain or operations
or those of our suppliers; competition for qualified personnel;
strategic actions, including acquisitions and dispositions, our
success in performing due diligence, valuing and integrating
acquired businesses; disruption that may result from transactions
or other changes we make in our business plans or organisation to
adapt to market developments; and numerous other matters that
affect us or our markets, including those of a political, economic,
business, competitive or reputational nature. Please refer to the
documents that Smith+Nephew has filed with the U.S. Securities and
Exchange Commission under the U.S. Securities Exchange Act of 1934,
as amended, including Smith+Nephew's most recent annual report on
Form 20-F, for a discussion of certain of these factors. Any
forward-looking statement is based on information available to
Smith+Nephew as of the date of the statement. All written or oral
forward-looking statements attributable to Smith+Nephew are
qualified by this caution. Smith+Nephew does not undertake any
obligation to update or revise any forward-looking statement to
reflect any change in circumstances or in Smith+Nephew's
expectations.
◊ Trademark of Smith+Nephew. Certain marks registered US
Patent and Trademark Office.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
Smith
& Nephew Plc
(Registrant)
Date: March
30, 2020
By: /s/
Susan Swabey
-----------------
Susan
Swabey
Company
Secretary