Smith+Nephew reported single-digit revenue growth for both the fourth quarter and full year of 2019.
Seven things to know.
1. Smith+Nephew reported $1.4 billion in revenue for the fourth quarter of 2019, and $5.1 billion for the full year. The fourth quarter revenue grew 8.7 percent while full year revenue was up 4.4 percent.
2. The company's orthopedics business reported 4 percent underlying revenue growth, while sports medicine and ENT reported the highest revenue growth at 7.7 percent. In the fourth quarter, orthopedics revenue was up 5.1 percent, driven by knee implant revenue, which increased 4.7 percent. Hip revenue for the quarter was flat, but sports medicine and ENT revenue increased 10.1 percent and sports medicine joint repair revenue was up 14 percent.
3. Over the past year, the company adopted a new global commercial model build around three global franchises and unveiled new "purpose and culture" pillars as well as five strategic imperatives for value creation. Smith+Nephew also upped research and development investment by 19 percent to $292 million and reported product launches across all lines.
4. In 2020, the company aims to improve performance while continuing to invest in its business and improve agility. Smith+Nephew aims to deliver commercial excellence, bring greater rigor to product launches and portfolio management and further invest in salesforce training.
5. Smith+Nephew will continue to invest in emerging markets and the developing orthopedics segment in ASCs in the U.S. The 2020 changes in Medicare reimbursement for total joint replacements and other orthopedics procedures in ASCs are expected to increase activity in this field.
6. In 2020, Smith+Nephew expects to report underlying revenue growth of 3.5 percent to 4.5 percent and deliver a 2020 trading profit margin at or slightly above the levels in 2019.
7. The company has been impacted by the COVID-19 outbreak in China and estimates the situation will normalize in the second quarter of 2020. China represented 7 percent of the company's revenue in 2019.