Are the fortunes of long-suffering shareholders in hip replacement maker Smith & Nephew about the change?. That’s certainly the hope of chief executive Deepak Nath after what he described as a ‘strong finish’ to last year as a recovery in the United States offset further problems in China.
‘Smith & Nephew’s transformation remains on track,’ he said. ‘There is much more to be done, but we have made solid progress fixing the foundations and expect a step-up in returns in 2025, including significant margin expansion. ‘We are confident that this will be the year when transformation starts to unlock substantial value for our shareholders.’.
That was music to the ears of investors, and the shares rose 10 per cent in early trading before ending the day up 6.1 per cent, or 64p, to 1107.5p. Turnaround: Smith & Nephew shares rose 10% in early trading before ending the day up 6.1%, or 64p, to 1107.5p. That took gains for the year to nearly 11%.
That took gains for the year to nearly 11 per cent though the shares are still down nearly 50 per cent since their pre-Covid peak. The medical technology giant recently faced calls from its biggest investors to break itself up. Late last year, its top 20 shareholders demanded that bosses consider spinning off the orthopaedics business, which makes replacement hip and knee joints.
That came after a profit warning in October, when bosses complained of poor sales in China, which had resulted in the company’s distributors sitting on unusually high levels of unsold products. But Smith & Nephew brought better news yesterday, reporting a 7.8 per cent rise in revenues for the final three months of the year, helping push annual profits up 55 per cent to £520million.
The FTSE 100 added 0.11 per cent, or 9.69 points, to 8668.67 and the FTSE 250 slipped 0.18 per cent, or 36.11 points, to 20,448.28. BAE Systems rose 4.7 per cent, or 61p, to 1366p after Prime Minister Keir Starmer pledged to raise defence spending in the UK from 2.3 per cent of GDP to 2.5 per cent by 2027.
Shares in troubled Wood Group rose almost 10 per cent in early trading following a jump of more than 40 per cent in the previous session as it is once again became a takeover target. The North Sea engineer’s stock later closed up 2.9 per cent, or 1.08 points, to 38.4p.
The FTSE 250 firm revealed on Monday that it has received a fresh approach from Dubai-based Sidara following the recent slump in its share price. Sidara abandoned plans to buy Wood Group for 230p a share or £1.6billion last year – but is once again showing its interest as it looks to snap it up on the cheap.
Banks were on the march with a FTSE 350 index tracking the sector hitting its highest level since October 2008 in the wake of the collapse of Lehman Brothers. Georgian lenders made much of the running after upbeat figures from Lion Finance, formerly Bank of Georgia. Lion Finance gained 2.1 per cent, or 110p, to 5420p, and TBC grew by 3.8 per cent, or 155p, to 4290p.
Among the blue chips, Natwest added 2.2 per cent, or 9.6p, to 453.3p, HSBC ascended by 2.5 per cent, or 21.8p, to 899.5p, Standard Chartered rose 2.1 per cent, or 24.5p, to 1201p, and Lloyds advanced 1.9 per cent, or 1.3p, to 68.62p, but Barclays inched down 0.6 per cent, or 1.9p, to 296.85p.
Shares in trading platform CMC Markets slipped after a shake-up at the top. The FTSE 250 business said chief financial officer Albert Soleiman has stepped down ‘with immediate effect’ having only taken the job in September 2023. However, Soleiman, who joined CMC Markets in 2005 and is also resigning as a director, will remain with the firm to assist with handover duties.
Shares fell 6.2 per cent, or 13.1p, to 198.4p on the news yesterday. Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.
