TIDMSN.

RNS Number : 4963M

Smith & Nephew Plc

23 May 2022

SMITH & NEPHEW PLC

23 May 2022

NOTIFICATION AND PUBLIC DISCLOSURE IN ACCORDANCE WITH THE REQUIREMENTS OF THE EU MARKET ABUSE REGULATION OF TRANSACTIONS BY PERSONS DISCHARGING MANAGERIAL RESPONSIBILITIES ("PDMR") AND PERSONS CLOSELY ASSOCIATED WITH THEM.

On 20 May 2022 the following awards of US$0.20 ordinary shares (the "Shares") in Smith & Nephew plc (the "Company") were granted under the Smith & Nephew Global Share Plan 2020. The awards have been made in London and are based on the closing Share price on the London Stock Exchange on 19 May 2022 of GBP12.58.

1. PERFORMANCE SHARE PROGRAMME 2022 AWARDS GRANTED UNDER THE SMITH & NEPHEW GLOBAL SHARE PLAN 2020

The Remuneration Committee has approved performance conditions attached to the vesting of these awards, which are detailed below. These awards will vest on 20 May 2025 for the Executive Directors and 9 March 2025 for the other participants, subject to the achievement of the performance conditions which are measured over the period 1 January 2022 to 31 December 2024 as set out below.

The number of shares subject to the above awards are shown at target vesting. Should maximum vesting be achieved, participants will receive 2x the number of shares shown below. Participants will receive an additional number of shares equivalent to the amount of dividend payable per vested share during the relevant performance period.

The following relates to all individuals included in this section:

 
 Reason for the notification 
 Initial notification        Initial notification 
  /Amendment 
                            ------------------------------------------- 
 Details of the issuer, emission allowance market participant, 
  auction platform, auctioneer or auction monitor 
 Name                        Smith & Nephew plc 
                            ------------------------------------------- 
 LEI                         213800ZTMDN8S67S1H61 
                            ------------------------------------------- 
 Details of the transaction(s): section to be repeated for 
  (i) each type of instrument; (ii) each type of transaction; 
  (iii) each date; and (iv) each place where transactions have 
  been conducted 
 Description of the          Smith & Nephew plc Ordinary Shares of USD 
  financial instrument,       0.20 each 
  type of instrument 
                            ------------------------------------------- 
 Identification code         ISIN: GB0009223206 
                            ------------------------------------------- 
 Nature of the transaction   Performance Share Awards granted at target 
                              on 20 May 2022 under the Smith & Nephew 
                              Global Share Plan 2020. 
                            ------------------------------------------- 
 Date of Transaction         2022 - 05 - 20 
                            ------------------------------------------- 
 Place of Transaction        Grant took place outside a trading venue 
                            ------------------------------------------- 
 
 
                              Director                             Aggregated 
 Name (Position)               / PDMR      Price (GBP)   Volume     information 
 Helen Barraclough 
  (Group General 
  Counsel and Company 
  Secretary)                  PDMR         12.58         29,904    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Bradley Cannon 
  (President Orthopaedics, 
  Sports Medicine 
  & ENT and Americas)         PDMR         12.58         97,099    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Peter Coenen 
  (President EMEA 
  Region)                     PDMR         12.58         41,392    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Paul Connolly 
  (President Global 
  Operations)                 PDMR         12.58         37,606    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Phil Cowdy 
  (Chief Business 
  Development & 
  Corporate Affairs 
  Officer)                    PDMR         12.58         32,224    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Myra Eskes 
  (President APAC 
  Region)                     PDMR         12.58         47,524    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Simon Fraser 
  (President Advanced 
  Wound Management 
  and Global Commercial 
  Operations)                 PDMR         12.58         77,969    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Mizanu Kebede 
  (Chief Quality 
  & Regulatory 
  Affairs Officer)            PDMR         12.58         38,452    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Elga Lohler 
  (Chief HR Officer)          PDMR         12.58         47,057    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Deepak Nath 
  (Chief Executive            Executive 
  Officer)                     Director    12.58         129,711   N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Anne-Françoise 
  Nesmes 
  (Chief Financial            Executive 
  Officer)                     Director    12.58         67,324    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Vasant Padmanabhan 
  (President Research 
  & Development)              PDMR         12.58         45,776    N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 Alison Parkes 
  (Chief Compliance 
  Officer)                    PDMR         12.58         8,403     N/A Single Transaction 
                             -----------  ------------  --------  ----------------------- 
 

As explained on page 127 of the 2021 Annual Report the performance conditions applying to these awards have been determined by the Remuneration Committee.

The awards made to the Executive Directors are subject to four equally weighted performance measures: Total Shareholder Return (TSR), Return on Invested Capital (ROIC), Global Revenue Growth and Cumulative Free Cash Flow. Page 127 of the 2021 Annual Report explains how TSR will be measured and defines the calculation of ROIC with reference to the methodology on page 126.

The awards subject to TSR will vest as follows. The two equally weighted peer groups are defined on page 127 of the 2021 Annual Report.

 
                            Award vesting as % of salary at date of 
                                                              grant 
                       Sector based peer group   FTSE100 peer group 
                      ------------------------  ------------------- 
 Below the index                           Nil                  Nil 
                      ------------------------  ------------------- 
 Equaling the index                       8.6%                 8.6% 
                      ------------------------  ------------------- 
 8% above the index                      34.4%                34.4% 
                      ------------------------  ------------------- 
 

Awards will vest on a straight-line basis between these points. The maximum has been set significantly above target reflecting the maximum opportunity for outperformance.

The awards subject to ROIC will vest as follows:

 
 Return on Invested Capital     Award vesting as a % of salary 
  Year ended 31 December 2024 
 Below 8.0%                                                Nil 
                               ------------------------------- 
 8.0%                                                    17.2% 
                               ------------------------------- 
 9.0%                                                    34.4% 
                               ------------------------------- 
 10.5%                                                   68.8% 
                               ------------------------------- 
 

Awards will vest on a straight-line basis between these points.

The awards subject to Revenue Growth will vest as follows:

 
 Revenue Growth                      Award vesting as a % of salary 
  Three years ended 31 December 
  2024 
 Below Threshold                                                Nil 
                                    ------------------------------- 
 Threshold (-5% of target)                                    17.2% 
                                    ------------------------------- 
 Target - set by reference to 
  our expectations                                            34.4% 
                                    ------------------------------- 
 Maximum or above (+5% of target)                             68.8% 
                                    ------------------------------- 
 

Awards will vest on a straight-line basis between these points.

Revenue Growth targets for the three years ended 31 December 2024 for these awards, even though now determined, will not be disclosed until the 2024 Annual Report, when the Remuneration Committee will discuss performance against the target. It is not possible to disclose precise targets at the time of grant to avoid giving commercially sensitive information to our competitors concerning our growth plans.

The awards subject to Cumulative Free Cash Flow will vest as follows:

 
 Cumulative Free Cash Flow        Award vesting as % of salary 
  Three years ended 31 December 
  2024 
 Below $1,535m                                             Nil 
                                 ----------------------------- 
 $1,535m                                                 17.2% 
                                 ----------------------------- 
 $1,913m                                                 34.4% 
                                 ----------------------------- 
 $2,104m                                                 68.8% 
                                 ----------------------------- 
 

Awards will vest on a straight-line basis between these points.

Sarah Carne

Deputy Company Secretary

Smith & Nephew plc

Tel: +44 (0)1923 477100

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May 23, 2022 11:45 ET (15:45 GMT)

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