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Kamis, 02 Agustus 2012

Smith & Nephew raises dividend by 50pc

That was partly offset by a stong performance in S&N's sports medicine business, which returned to double-digit growth, with revenue up 10pc in the second quarter. Sales in the advanced wound management division - which includes the treatment of hard-to-heal wounds such as those sustained through trauma - were $495m in the first half, up $5m on the same period last year.

With established markets remaining subdued, S&N has increased its focus on emerging markets, where the business clocked up 10pc growth in the second quarter. The company has also instigated a $150m cost-cutting programme and earlier this year announced it would cut 800 jobs worldwide from its 11,000 headcount.

Olivier Bohuon, S&N's chief executive, said the company's "good first half" demonstrates "the early benefits of our actions to reshape the group to provide the right commercial models, innovation and efficiencies required to win in our markets today and in the future".

"We have consistently delivered revenue and earnings growth and strong cash generation in the challenging markets of the last few years," he added. "This financial strength, and our confidence in delivering against our Strategic Priorities, has enabled us to increase substantially our dividend pay-out."

S&N said that its board intended to "pursue a progressive dividend policy, with the aim of increasing the US dollar value of ordinary dividends over time broadly based on the group's underlying growth in earnings, while taking into account capital requirements and cash flows".

Shares in S&N rose 14 to 673.5p in morning trading and analysts at Panmure Gordon retained their "buy" rating, saying: "There is a premium for boring in these markets, although we note the stock is almost at our price target. The market will also like the 50pc increase to dividend and commitment to progressive dividend policy."

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