Medtech firm Smith & Nephew has reported that its full-year underlying revenue increased by 7.2% to $5.5bn (£4.4bn) last year.

The medical equipment manufacturer’s trading profit was up 7.6% to $970m (£765m) while its trading profit margin climbed to 17.5%, up from 17.3% in 2022.

Smith & Nephew is a portfolio medical technology company focused on the repair, regeneration and replacement of soft and hard tissue.

The group reported that in its orthopaedics division, underlying growth was up 5.7%, setting foundations for further improvement, while in sports medicine its underlying growth was up 10.0%, including headwind from a slow Chinese market.

In its advanced wound management business, the group delivered 6.4% underlying revenue growth, maintaining momentum from the previous year.

“I am pleased with our overall performance in 2023, as our actions to transform Smith & Nephew have begun to translate into meaningful financial outcomes,” said CEO of the group, Deepak Nath. “We delivered revenue growth ahead of guidance for the full year and made important improvements to our trading profit margin against a challenging macro-environment.”

Nath added: “Our investment in innovation continues to deliver, with almost half of our 2023 growth coming from products launched in the last five years. We were pleased to add major launches in robotics, shoulder arthroplasty and negative pressure wound therapy to the portfolio during the year.

“We have entered 2024 as a fundamentally stronger business and look forward to delivering another year of robust growth and further margin expansion.”

Head of equity research at Hargreaves Lansdown, Derren Nathan, commented: “Inflation is expected to be a continued brake on profit growth in 2024, and the volume-based procurement programme by the Chinese authorities remains a significant challenge to meeting a 2025 margin target of 20%.

“Smith & Nephew expects to make some progress towards this in 2024 but there’s still some way to go if it’s going to make good on that promise.”

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