Board Appointments

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2008 Third Quarter ResultsSustainable
profitable growth
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Forward looking statements

• This presentation contains certain
  "forward-looking statements" within the meaning
  of the US Private Securities Litigation Reform
  Act of 1995. In particular, statements
  regarding expected revenue growth and trading
  margins discussed under "Outlook" are
  forward-looking statements as are discussions of
  our product pipeline. These statements, as well
  as the phrases "aim", "plan", "intend",
  "anticipate", "well-placed, "believe",
  "estimate", "expect", "target", "consider" and
  similar expressions, are generally intended to
  identify forward-looking statements. Such
  forward-looking statements involve known and
  unknown risks, uncertainties and other important
  factors (including, but not limited to, the
  outcome of litigation, claims and regulatory
  approvals) that could cause the actual results,
  performance or achievements of Smith Nephew, or
  industry results, to differ materially from any
  future results, performance or achievements
  expressed or implied by such forward-looking
  statements. Please refer to the documents that
  Smith Nephew has filed with the U.S. Securities
  and Exchange Commission under the U.S. Securities
  Exchange Act of 1934, as amended, including Smith
  Nephew's most recent annual report on Form 20F,
  for a discussion of certain of these factors.
• All forward-looking statements in this
  presentation are based on information available
  to Smith Nephew as of the date hereof. All
  written or oral forward-looking statements
  attributable to Smith Nephew or any person
  acting on behalf of Smith Nephew are expressly
  qualified in their entirety by the foregoing.
  Smith Nephew does not undertake any obligation
  to update or revise any forward-looking statement
  contained herein to reflect any change in Smith
  Nephew's expectation with regard thereto or any
  change in events, conditions or circumstances on
  which any such statement is based.

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David IllingworthChief Executive
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Q3 highlights

• Reported revenues up by 10 to 930 million
• Orthopaedics revenues grew by 6, 9 excluding
  the impact of Plus
• Reconstruction growth driven by strong
  contribution from knees
• Trauma changes in the US deliver a second quarter
  of increased revenue growth
• Endoscopy US shows strengthening revenue growth
  rate
• Advanced Wound Management grew above market rate
• Trading profit 174 million, 18.7 of revenues
• EIP targets unchanged
• EPSA increased by 3 to 12.2

sustainable profitable growth
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Q3 Orthopaedics
Global revenues of 513m grow 6 (9 excluding
Plus impact) Hip revenue growth 3 Knee revenue
growth 10 Trauma revenue growth 5 (9 excluding
Plus impact) US Trauma sales force performs well
Margin 19.9 impacted by Plus and compliance
costs Enhanced global compliance program

• Additional sizes of BHR in the US will commence
  in Q4
• Early Intervention Knee platform (JOURNEY BCS,
  DEUCE and Uni) continue to gain momentum
• Launch of INTERTAN Side Plate and PERI-LOC
  Plate for Hip Fracture market complements our
  extensive nail line

Sound performance
Orthopaedics
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Q3 Endoscopy
Revenues 195m, growth of 8, 9 outside
US Repair grows 17 and exceeds resection
revenues Visualisation revenues grow
9 Litigation and intellectual property activity
dampens margin

• US sales organisation changes start to drive
  improved rate of growth
• Global launch of bio-absorbable BIOSURE HA
  Interference screw
• Outside US training for future growth

US delivers sequential revenue improvement
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Q3 Advanced Wound Management
Revenues of 222m and global growth of 8 Outside
US grows 9 US revenues grow 8 NPWT increases
billed accounts 25 in the period Margin 17.2
as investment in NPWT continues

• Exudate management grows 6 driven by ALLEVYN
• Infection management growth of 13 driven by
  silver range
• China factory on track

Growth above market and steady progress with NPWT
Advanced Wound Management
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Advanced Wound Management China factory
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Adrian HennahChief Financial Officer
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Income statement Q3 2008
2007 restated for finalisation of Plus
acquisition accounting
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Income statement Q3 2008
2007 restated for finalisation of Plus
acquisition accounting Excluding restructuring
and rationalisation costs, acquisition related
costs, amortisation of acquisition intangibles
and legal settlements (in 2007)
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Revenue growth by business segment Q3 2008

• Q3 2008 comprises 63 trading days (2007 63
  trading days)
• Adjust for the impact of Plus sales lost due
  to unacceptable sales practices in parts of
  Europe

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Underlying revenue growth by geography business
segment Q3 2008
Growth
USm
Growth
Europem
Growth
ROWm
Growth
Totalm
Quarter 3
Underlying Excluding Sales Practice Changes
6
277
9
147
(5)
89
21
513
Orthopaedics
9
8
92
7
57
6
46
13
195
Endoscopy
8
8
42
8
120
7
60
11
222
AWM
8
7
411
8
324
1
195
16
930
Group
9
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Profitability by business segment Q3 2008
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Share Buy Back

• 16.3m shares bought back in 2008 for 193m
• Total of 68.2m shares bought back, returning cash
  of 833m to shareholders
• Decision to defer programme in light of financial
  market instability

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Committed Debt Facilities

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2008 outlook

• Revenue growth
• Ortho close to market growth in USA, impacted
  by Plus issues in Europe
• Endoscopy continue to grow slightly below the
  market
• Advanced Wound Management excluding NPWT, at or
  slightly above served market
• EIP on track. Impact from Plus sales practice
  changes, NPWT investment, compliance costs.
• Plus sales practice changes - to reduce revenues
  by c.100m in a full year, somewhat less in 2008

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David IllingworthChief Executive
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Summary

• Good quarter of solid progress
• Knee portfolio delivering good growth
• US Trauma revenues improved
• US Endoscopy revenues improved
• Advanced Wound Management and NPWT growth rate
• EIP continued progress
• Uncertain economic conditions
• We have
• The right products
• The right people
• In growing markets

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Appendices
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Quarterly revenues
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
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New products 2008
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Exchange rates
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Analysis of restructuring and acquisition costs

• Target 125m over three years
• Target 60-80m

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Free cash flow Q3 2008
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Reconciliation of free cash flow to IAS 7 net
cash flow from operating activities
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Business days per quarter