InfuSystems Holdings, Inc.

Hello and welcome to the IMFU System Holdings Incorporated second quarter 2023 financial results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. Please note this event is being recorded. I would like now to turn the conference over to Joe Dorme, Managing Partner. Please go ahead.

Good morning, and thank you for joining us today to review NFU Systems' financial results for the second quarter of 2023 and in June 30, 2023. With us today on the call are Rich DiIorio, Chief Executive Officer, Barry Steele, Chief Financial Officer, and Carrie LeChance, President and Chief Operating Officer. After the conclusion of today's prepared remarks, we will open the call for questions. Before we begin with prepared remarks, I would like to remind everyone, certain statements made by the management team of IFE Systems during this conference call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Except for the statements of historical fact, this conference call may contain forward-looking statements that involve risks and uncertainties, some of which are detailed under risk factors and documents filed by the company with the Security and Exchange Commission, including the annual report on Form 10-K for the year ended December 31st, 2022. Forward-looking statements speak only as of the date the statements were made. The company can give no assurance that such forward-looking statements will prove to be correct. INFUSYSTEM does not undertake and specifically disclaims any obligation to update any forward-looking statements except as required by law. Now I'd like to turn the call to Rich DiIorio, Chief Executive Officer of INFUSYSTEM. Rich?

Thanks, Joe, and good morning, everyone, and welcome to INFUSYSTEM's second quarter 2023 earnings call. Thank you all for joining us today. I'll start by noting that a key theme in our prior two calls this year was that 2023 is going to be an execution year. With this morning's press release, we now see strong second quarter numbers building on those from the first quarter and delivering results for the first half of the year that meet or exceed expectations. Barry will cover the specifics of the quarter in a few minutes, but I will point out that Q1 2023 was the first quarter in our history where revenue exceeded $30 million. And the recently completed second quarter was the first ever above 31 million, coming in at 31.7 million, which reflects 17% growth year over year. Our growth in the first half of the year is the result of strong execution in our biomed and wound care businesses, specifically the rollout under the initial master services agreement with GE, and it's moving rapidly and has achieved the desired momentum. In wound care, we saw another strong quarter of negative pressure device placements as part of our relationship with Cork Medical. As a reminder, these device placements not only contribute to our top line, but they are also important to establish our customer base as we prepare for the introduction of Senera products that we hope will be a growth driver starting in 2024. I'd like to do a quick review of the strategic decisions that paved the way for the performance that we are seeing in 2023. Prior to 2020, InfuSystem had a long history as primarily an oncology pump company. Hidden within that business was a collection of underappreciated and underutilized assets and capabilities. These include our national payer contracts covering 96% of the US population, a strong and scalable revenue cycle management team, and great biomedical services capabilities. Starting just a few years ago, we began looking beyond oncology and infusion pumps to expand the potential of both of our business units, patient services and device solutions. And this has led to material growth opportunities first involving McKesson, then Cardinal, GE, and most recently Cork and Sonera. To understand how these partnerships and opportunities grow our business, it is important to emphasize that InfiSystem is a service company. We provide services that solve difficult problems for manufacturers, healthcare providers, patients, and payers. What we do is challenging, requiring a long-term vision built around a culture dedicated to patient care. All this is to explain why it often takes time between when we announce new business initiatives and when the revenue from these initiatives begins to ramp. We attempt to be as transparent as possible. Often our initiatives require investments be made several quarters in advance of anticipated revenue. In this, we would like to thank you for your patience as we've all waited for some of the big initiatives we've been pursuing to begin bearing fruit. 2023 is a year where the benefits of the hard work and effort in prior years is beginning to show up. With GE, that work began back in 2021 when we started talking about what would become the master services agreement. We signed that deal and started work in 22, and now in 23, we see how impactful the relationship is and will continue to be. The next big initiative is the joint venture with Sonera. The nature of that relationship was developed through 22, and in 2023, we are steadily working towards the necessary preparation to allow a material revenue ramp to start in 24. GE and the Sonera Joint Venture are not the only projects we are working on, but they are currently the biggest and are expected to be the most impactful. The total addressable market for biomedical services is huge, especially in acute care, and the GE opportunity will open doors for us as we execute on the existing agreement and place our technicians in hospitals all over the country. The new initiative with Sonera is a much larger opportunity than our initial project a few years ago that involved only negative pressure wound therapy. But it was that early work with Cardinal that brought Cenara to us and led to the joint venture. Cenara has incredible products and a disruptive model that can greatly benefit patients and payers focused on healing patients. The partnership brings together these products with our national payer contracts, robust RCM capabilities, and the logistics backbone that are needed to address the opportunities that Cenara has long seen in skilled nursing and long-term care facilities. That will be a 2024 story. and I'm happy to report that the progress and preparations remain on schedule. Now I would like to update everyone on our guidance. At the beginning of the year, we gave guidance for the full year estimating net revenue growth of 8% to 10% and greater than 19% adjusted EBITDA margin. Through the first half of this year, our revenue has grown at a pace above the 8% to 10% rate we guided for the full year. We expect our revenue to come in above the range previously provided. How much above depends on a variety of factors, some of which are outside of our control. Accordingly, we are taking a conservative approach and raising our full-year guidance to have net revenue growth of 10-plus percent. We should have even greater visibility when we speak again after our Q3 results in the fall, and we'll give you more color and updated numbers. Barry will now take us through the financial results for the second quarter, and then Carrie will provide additional color on operations involving GE and Sonera.