2011 First Quarter ResultsGood start to the year

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Forward looking statementsThis document contains certain forward-looking statements that may or may not prove accurate. For example,statements regarding expected revenue growth and trading margins, market trends and our product pipeline areforward-looking statements. Phrases such as "aim", "plan", "intend", "anticipate", "well-placed", "believe", "estimate","expect", "target", "consider" and similar expressions are generally intended to identify forward-looking statements.Forward-looking statements involve known and unknown risks, uncertainties and other important factors that couldcause actual results to differ materially from what is expressed or implied by the statements. For Smith & Nephew,these factors include: economic and financial conditions in the markets we serve, especially those affecting healthcare providers, payors and customers; price levels for established and innovative medical devices; developments inmedical technology; regulatory approvals, reimbursement decisions or other government actions; product defects orrecalls; litigation relating to patent or other claims; legal compliance risks and related investigative, remedial orenforcement actions; strategic actions, including acquisitions and dispositions and our success in integratingacquired businesses; and numerous other matters that affect us or our markets, including those of a political,economic, business or competitive nature. Please refer to the documents that Smith & Nephew has filed with theU.S. Securities and Exchange Commission under the U.S. Securities Exchange Act of 1934, as amended, includingSmith & Nephew's most recent annual report on Form 20F, for a discussion of certain of these factors.

Any forward-looking statement is based on information available to Smith & Nephew as of the date of the statement.All written or oral forward-looking statements attributable to Smith & Nephew are qualified by this caution. Smith &Nephew does not undertake any obligation to update or revise any forward-looking statement to reflect any changein circumstances or in Smith & Nephew's expectations.

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Olivier BohuonChief Executive Officer

Q1 2011 highlights

• Reported Q1 revenues – $1,055m up 4% underlying

• Orthopaedics up 2%

– Reconstruction grows above market rate, driven by knees

– Trauma delivers another good performance

• Endoscopy up 6% – strong repair product revenues

• Advanced Wound Management up 6% - NPWT strong

• Trading margin 22.8% - essentially flat excluding BlueSky settlement

• Debt reduced to $351m, $139m of free cash flow in the quarter

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Adrian HennahChief Financial Officer

First Quarter

2010 2011 Growth

$m $m Reported Underlying

Revenue 995 1,055 6% 4%

Trading profit 250 241 (4)% (6)%

Restructuring and rationalisation costs (2) (1)

Amortisation of acquisition intangibles / impairments (8) (9)

Operating profit 240 231

Net interest cost (4) (2)

Other finance costs (2) (1)

Profit before taxation 234 228

Trading margin % 25.1% 22.8% (230 bps)

Income statement Q1 2011

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Income statement Q1 2011

* Excluding restructuring and rationalisation costs, amortisation of acquisition intangibles / impairments.

First Quarter

2010 2011

$m $m

Profit before taxation 234 228

Taxation (75) (72) Tax rate* 30.8 %

Attributable profit 159 156

Add back:Amortisation of acquisition intangibles / 8 9impairments

Restructuring & rationalisation costs 2 1

Tax on excluded items (2) (2)

Adjusted attributable profit 167 164

Adjusted earnings per share ("EPSA") 18.8¢ 18.4¢ EPSA Growth (2.1)%

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Revenue growth by business segment Q1 2011

* Q1 2011 comprises 64 trading days (2010 – 64 trading days)

ActualReported Currency Underlying

% % %Quarter 1*

Orthopaedics 4 (2) 2Endoscopy 8 (2) 6Advanced Wound Management 9 (3) 6Group 6 (2) 4

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Underlying revenue growth by geography &business segment Q1 2011

US Growth Europe Growth ROW Growth Total Growth

Quarter 1 $m % $m % $m % $m %

Orthopaedics 306 5 170 (2) 114 3 590 2

Endoscopy 92 1 76 6 65 12 233 6

Advanced Wound Management 41 6 117 2 74 15 232 6

Group 439 4 363 1 253 8 1,055 4

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Orthopaedics

Market leading knee growth

drives Reconstruction market

outperformance

• Knees: market leadingperformance driven byVERILAST™ and VISIONAIRE™

• Traditional hips grow aheadof market; BHR headwindscontinue

• Trauma, another consistentperformance

• Clinical Therapies:EXOGEN™ strong growth

Q1 2011 – Orthopaedics

• Global revenues $590m in Q1, 2% growth

- US +5%, Europe -2%, RoW +3%

• Global Reconstruction growth +2%

- Global knees +5% (US +10%, OUS 0%)

- Global hips -2% (US -4%, OUS -1%)

• Global Trauma +6% (US +7%, OUS +5%)

• Clinical Therapies revenues $55m

• Margin 24.1%, down 140bps

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Q1 2011 - Endoscopy

• Global Revenues $233m in Q1, 6% growth

– US +1%, Europe +6%, RoW +12%

• Arthroscopy growth +8%

- Repair +11%

- Resection +3%

• Visualisation -7%

• Margin 22.3% up 120bps

Endoscopy

Double digit repair growth

• Shoulder and hip repairstrong

• BIORAPTOR™ CurvedSuture Anchor forshoulder/hips

• DYONICS PLATINUMblades introduced

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Advanced Wound Management

Q1 2011 - Advanced Wound Management

• Global Revenues $232m, 6% growth

– US +6%, Europe +2%, RoW + 15%

• Exudate Management +2%, Infection Management - 1%

• NPWT strong revenue growth

• Margin 20.1%, down 840bps reported

– BlueSky adjusted, up 230bps

• 5 new product introductions• NPWT revenues benefit from

broader product range,further launches in Q2

• NPWT significant contractwins

• Targeted marketinginvestments in Europe

• European austerity – marketgrowth now 1%

NPWT drives market

outperformance

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Profitability by business segment Q1 2011BlueSky

First Quarter AdjustedRevenue Trading Profit Margin Margin

2011 $m $m % %

Orthopaedics 590 142 24.1

Endoscopy 233 52 22.3

Advanced Wound Management 232 47 20.1

Total 1,055 241 22.8

2010

Orthopaedics 566 144 25.5

Endoscopy 216 45 21.1

Advanced Wound Management 213 61 28.5 17.8

Total 995 250 25.1 22.9

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Free cash flow Q1 2011First Quarter

2010 2011$m $m

Trading profit 250 241

Share based payment 5 7

Depreciation and amortisation 60 64

Capital expenditure (74) (73)

Movements in working capital and provisions (53) (33)

Trading cash flow 188 206

Restructuring, rationalisation & acquisition costs (5) (1)

Macrotextured claim (1) (1)

Operating cash flow 182 204

Net interest paid (6) (3)

Taxation paid (45) (62)

Free cash flow 131 139

Closing Net Debt (783) (351)

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Q1 2011 Summary and outlook

• Good start to the year

• No change in 2011 outlook‐ Revenue: above market growth in Orthopedic Reconstruction,

Endoscopy sports medicine and Advanced Wound Management;consistent improvement in Orthopedic Trauma

‐ Margin: further efficiency improvements broadly matchinvestments and price pressures

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Questions

Appendices

Smith & Nephew Key Product Line Revenues in $m at Average Rates and Underlying Growth

* All revenue growths are on an underlying basis as previously reported, excluding the effects of acquisitions and currency translation

Quarterly revenues

Q1 Q2 Q3 Q4 Full YearGrowth* Growth* Growth* Growth* Growth* Revenue Growth*

% % % % % $m %Orthopaedics

Reconstruction Knees 9% 3% 6% 4% 5% 224 5% Hips 6% 0% 0% (5)% 0% 184 (2)%Trauma 3% 2% 5% 4% 3% 116 6%Clinical therapies 5% (6)% (5)% (12)% (5)% 55 2%

EndoscopyArthroscopy 17% 11% 8% 2% 9% 201 8%Visualisation 0% (2)% (19)% (12)% (9)% 27 (7)%

Advanced Wound ManagementExudate Management 7% 0% 3% (2)% 2% 65 2%Infection Management 7% 7% 5% (5)% 3% 29 (1)%

Smith & Nephew 9% 4% 4% 0% 4% 1,055 4%

2010 2011Q1

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Exchange rates$:€ Q1/10 FY/10 Q1/11

Period end 1.35 1.34 1.41

Average 1.38 1.32 1.37

$:£

Period end 1.52 1.57 1.60

Average 1.56 1.54 1.60

Percentage of Revenue by Geographic Market: Q1%

United States 42United Kingdom 6Other Europe 28Other 24

100

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Analysis of restructuring and acquisition costs

* Target $125m

** Target $60-80m, plus $15m costs of investigating and resolving issues withthe vendors

P&L Charge Cash SpendQ1 Total to date Q1 Total to date$m $m $m $m

EIP- cash costs * 1 116 1 109- asset w/offs - 26 n/a n/a

Plus Integration- cash costs ** - 95 - 92- asset w/offs - 28 n/a n/a

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Reconciliation of free cash flow to IAS 7net cash flow from operating activities

First Quarter

2010 2011$m $m

Free cash flow 131 139

Add back: capital expenditure 74 73

Net cash inflow from operating activities (IAS 7) 205 212

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Business days per quarter

Q1 Q2 Q3 Q4 Full Year

2010 64 64 63 60 251

2011 64 63 63 60 250

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New products 2011

Advanced Wound ManagementEndoscopyOrthopaedic Reconstruction

Q1 Q2 Q3 Q4

SMF™ Short Modular FemoralHip System

LEGION™ XLPE Inserts

ACTICOAT™ Ortho SURESHOT™ Humeral

SCOLISCORETM AISPrognostic test DUROLANE® -SJ VISIONAIRE™ Technology for

TC Plus

Specialty Blades for Small Jointand Hip Anatomic ACL Guides BIORAPTOR™ Curved Suture

Anchor and Guide System LEGION Narrow

ALLEVYN™ GB Surgical andGB Sacrum BIOSURE™ HEALICOIL Screw VERSAJET™ II - Next generation High Performance Blades

REPLICARE™ Lite Additional variants ofALLEVYN GB

Additional variants ofALLEVYN GB

Additional variants ofALLEVYN GB

ACTICOAT Post-Op NPWT range expansion(Europe) NPWT range expansion (US) NPWT next generation

accessories

Orthopaedic Trauma Clinical Therapies 24