Professional Documents
Culture Documents
Sports Medicine 5%
Joint Repair
2% Arthroscopic
Enabling Tech -4%
US
Trauma &
Extremities 7%
Other Surgical
11%
Knees 4%
-1%
Other Est Hips -1%
2%
AWC
0%
13% Emerging AWB
14%
AWD
-5% 0% 5% 10% 15%
-5% 0% 5% 10% 15%
Underlying change (%) Underlying change (%)
* Underlying growth is not adjusted for the impact of one fewer selling day in Q2 2017 compared to Q2 2016
Other Est is Australia, Canada, Europe, Japan and New Zealand 5
Other Surgical includes ENT and robotics sales (excluding implant sales)
Sports Medicine, Trauma & OSB
Q2 revenue performance
Sports Medicine Joint Repair +5% ($152m)
Arthroscopic Enabling Technologies (AET) -4% ($151m)
Trauma & Extremities +7% ($127m)
Other Surgical Businesses* +11% ($50m)
Commentary
recently launched products drive Sports Medicine Joint
Repair
continued softness in resection impacting AET
TRIGEN INTERTAN
Trauma benefitted from a tender in Gulf States Intertrochanteric Antegrade Nail
6
* Other Surgical Businesses includes ENT and robotics sales (excluding implant sales)
Reconstruction
Q2 revenue performance
Knees: global +4%, US +5%, OUS +3% ($246m)
Hips: global -1%, US -1%, OUS 0% ($150m)
Commentary
continued good growth in global Knees
new additions to LEGION Revision System launched
further additions to REDAPT Revision portfolio LEGION
Revision Knee System
7
Advanced Wound Management
Q2 revenue performance
Advanced Wound Care +2% ($177m)
Advanced Wound Bioactives 0% ($92m)
Advanced Wound Devices +14% ($49m)
Commentary
AWC trend improving as China returned to growth;
continued US strength
ACTICOAT Flex
AWB: SANTYL returned to growth Antimicrobial Barrier Dressing
8
Graham Baker
Chief Financial Officer
H1 trading income statement
2017 Growth
$m
Revenue 2,336 0% 3% underlying
growth
Cost of goods sold -603
Gross profit 1,733 2%
Gross profit margin 74.2% +140bps
10
H1 2017 trading margin
11
H1 IFRS reconciliation
2017 2016 Growth
$m $m
1
Reinvest for
2
Progressive
3
Acquisitions in Return excess
organic growth dividend policy line with strategy to shareholders
1,800
1,550 1,597
1,600
32 - 26
162
1,400
$m
351
178
1,200
1,000
800
31 Dec-16 FCF pre Capex Dividends Acquisitions Capital Other 1 Jul-17
Net Debt capex return Net Debt
15
2017 guidance reiterated; ongoing tax rate 1% lower
16
Olivier Bohuon
Chief Executive Officer
Our strategic priorities
18
Focus on Execution in Established Markets
19
US shift towards day-case surgery
20
* Ambulatory Surgery Centres provide same-day surgical care
Emerging Markets - a pillar of higher growth
25%
China: double digit growth expected for 20%
full year with improved channel 15%
management 10%
Gulf States: Tender order in Q2, not 5%
expected to repeat in H2 0%
Latin America and South East Asia -5%
growing well -10%
2013 2014 2015 2016 2017
21
* All revenue growth rates are on an underlying basis and without adjustment for number of selling days
Innovation in robotics-assisted surgery
22
ArthroCare acquisition update
23
Summary
H1: focus on execution
focus on better execution driving improvements
innovative products and technologies drive growth
Guidance confirmed
H1 results underpin our full year guidance
24
Questions
Appendices
2017 technical guidance
Guidance As of February 2017 Update
27
* Based on the foreign exchange rates prevailing on 21 July 2017
Franchise revenue analysis
2016 2017
Full
Q1 Q2 Q3 Q4 Q1 Q2
Year
Growth Growth Growth Growth Growth Growth Revenue Growth
% % % % % % $m %
Sports Medicine, Trauma & OSB 5 4 4 1 3 4 480 3
Sports Medicine Joint Repair 11 10 8 5 8 7 152 5
Full
Q1 Q2 Q3 Q4 Q1 Q2
Year
% % % % % % $m %
Geographic regions
US 8 4 2 0 3 1 582 2
Other Established Markets is Australia, Canada, Europe, Japan and New Zealand 29
All revenue growth rates are on an underlying basis and without adjustment for number of selling days
Business days per quarter
Q1 Q2 Q3 Q4 Full Year
2016 64 64 63 60 251
2017 64 63 63 60 250
$:
Period end 1.33 1.23 1.25 1.30
Average 1.43 1.35 1.24 1.28
31