Smith & Nephew announce an interim dividend is 14.4¢ per share (28.8¢ per ADS), in line with 2019. This equates to 11.2p per share at prevailing exchange rates as of 27 July 2020. The interim dividend will be paid on 28 October 2020 to shareholders on the register at the close of business on 2 October 2020.
The Board remains committed to Smith+Nephew's progressive dividend policy, whereby the dividend increases over time broadly in line with underlying earnings, and we look forward to returning to growing the dividend when performance allows.
Other financial highlights:
Trading in line with 1 July update as business was impacted by government-led restrictions to control COVID-19
Performance improved across Q2 as elective surgeries restarted, with underlying revenue declines of c. -47% in April, -27% in May, and -12% in June
o By quarter-end, elective procedures had resumed across the US and in most European countries
o China returned to growth for the second quarter
Operating and trading profit margin lower year-on-year, in line with previous announcements
o COVID-impact reflected in lower gross margins including from increase in provisions and factory underutilisation, and negative leverage from fixed SG&A costs
o Discretionary cost saving measures of approximately $150 million delivered in the first half, out of programme to deliver up to $200 million in 2020
Recently launched products performing strongly, including OR3O◊ Dual Mobility Hip System and EVOS◊ in Trauma
Investment in R&D maintained, with significant new product introductions including new robotics platform
Strong balance sheet and good liquidity, with net debt (excluding lease liabilities) of $2.1 billion versus $3.4 billion of committed facilities
2020 guidance remains withdrawn due to continuing uncertainty regarding impact of COVID-19