Bioventus Inc.

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. And to withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Mr. Dave Crawford. Please go ahead, sir.

Thanks, Chuck, and good morning, everybody. And thanks for joining us. It's my pleasure to welcome you to the BioVentus 2025 First Quarter Earnings Conference Call. With me this morning are Rob Claypool, President and CEO, and Mark Singleton, Senior Vice President and CFO. Rob will begin his remarks with an update on our business and our 2025 priorities, and then provide a brief discussion on the current macro environment. Then Mark will review our first quarter results and discuss our outlook, including our 2025 financial guidance. We will finish the call with Q&A. A presentation for today's call is available on the Investors section of our website, bioventus.com. Before we begin, I would like to remind everyone that our remarks today contain forward-looking statements that are based on the current expectations of management and involve inherent risks and uncertainties that could cause actual results to differ materially from those indicated, including the risks and uncertainties described in the company's filings with the Securities and Exchange Commission, including Item 1A risk factors of the company's Form 10-K for the year ended December 31, 2024. as such factors may be updated from time to time in the company's other filings made with the Securities and Exchange Commission. Your caution not to place undue reliance upon any forward-looking statements which speak only as the date made. Although the company may voluntarily do so from time to time, it undertakes no commitment to update or revise the forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by applicable securities laws. This call will also include reference to certain financial measures that are not calculated in accordance with U.S. generally accepted accounting principles or GAAP. We generally refer to these as non-GAAP or adjusted financial measures. Important disclosures about definitions and reconciliations of those non-GAAP financial measures to the most comparable measures calculated and presented in accordance with GAAP are available in the earnings press release on the investor section of our website at bioventures.com. And now I will turn the call over to Rob.

Thank you, Dave. Good morning, everyone, and thanks for joining our call today. I'm pleased to report that in the first quarter, the BioVentus team continued to successfully execute our plan, maintained strong momentum, and delivered yet another quarter of solid financial results as we help patients recover so they can live life to the fullest. First quarter revenue of $124 million was in line with our internal expectations and reflected above-market organic growth of 5%. As a reminder, our Q1 revenue growth reflects a comparison to strong prior year results with above normal orders by certain distributors at the end of last year. Adjusted earnings of $0.08 per share increased 33%, reflecting the strength of our peer-leading gross margin, prudent investment in key growth initiatives, and lower interest expense. Even with increased uncertainty in the macro environment, we do not see a material impact from tariffs at this time. and we remain well positioned for a second half acceleration in our growth with a strong focus on disciplined execution across the entire BioMemphis organization. As a result, we are reiterating our full year revenue, adjusted EBITDA, and adjusted earnings per share guidance. Now let's take a closer look at our first quarter results and provide an update on our business across the three priorities that I introduced at the start of the year. driving above-market revenue growth, expanding our profitability, and accelerating free cash flow generation. With respect to our first priority, driving above-market revenue growth and starting with surgical solutions, revenue advanced 7%, driven by double-digit growth in ultrasonics, where we continue to see substantial growth from market expansion with new capital placements. Our value proposition of enhanced precision and control for surgeons, reduced patient blood loss, and increased operating room efficiency continues to resonate well with surgeons and hospital administrators. In restorative therapies, Exogen maintained its momentum, highlighted by high single-digit growth in the U.S. We're excited about this performance as it validates our approach to drive the business with higher focus, increased investment, and improved commercial fundamentals. As we look to the rest of the year, we believe that Exogen has the ability to sustain this level of growth. And in pain treatments, growth continues to be driven by double-digit growth in Duralane. As we previously discussed, we expect pain treatments growth to accelerate in the second half of the year as we move past challenging comparisons to the prior year and realize the benefit from recent account wins. Before transitioning to our second focus area, I'm excited to share that we are expanding our pain treatments portfolio with the recent addition of a platelet-rich plasma, or PRP, system. As we have mentioned in the past, we will only add to our portfolio with world-class technology that is synergistic with our patient-based mission and our existing channels and call points. With these criteria in mind, during the first quarter, we signed an agreement with Apex Biologics to be the exclusive distributor of their Accel PRP system in the U.S. for orthopedics and sports medicine. PRP is a large and fast-growing market, and our research indicates that the majority of surgeons using our HA treatments also use PRP in their practice. So clearly, we believe the opportunity in PRP is synergistic with our sales force. Further, the Excel system is designed for increased physician efficiency and precision, as it reduces the procedural time and provides a customizable treatment solution for different patient applications. We believe these factors offer a significant competitive advantage. While the PRP revenue impact for 2025 is expected to be immaterial, we are excited about this portfolio expansion and adding another potential growth driver that leverages our existing HA commercial leadership and footprint. Turning to our second focus area, expanding profitability, We continue to strongly believe that our peer-leading gross margin, combined with the expected acceleration of revenue growth in the second half of the year, will enable us to achieve at least 100 basis points of adjusted EBITDA margin expansion for the year. Even when considering the macro environment, as we are prepared to swiftly adapt and prioritize spending if needed to help ensure we achieve this goal. And with respect to our third focus area, consistent with what we have shared in the past, we expect to nearly double cash from operations this year compared to last year. It is customary to see a significant acceleration in cash flow starting in the second quarter, and we are already seeing the drivers supporting this improvement with our reduction in interest expense and one-time cash costs. Let me conclude by reiterating that although the macroeconomic environment has become more dynamic since our last earnings call just two months ago, at this time we do not see a material impact based on the current schedule of expected tariffs. Nevertheless, we are being vigilant and continuously monitoring and planning for any potential changes. It's important to note that BioVentus has established a solid foundation, which we believe provides flexibility in navigating an uncertain macro environment and allows us to sustain the momentum that we've generated over the past two years. We have significantly enhanced our financial liquidity and cash flow generation. We've assembled a diverse portfolio of short, mid, and long-term growth drivers, and each business is well-positioned as the market or growth leader in large growing markets with favorable demographic trends. Almost all of our revenue is comprised of consumable products or therapies, many of which help to delay more expensive procedures. And finally, our dedicated team has displayed agility and resiliency in responding to change while driving strategic improvements. Challenges are not new to BioVentus, and given our substantial and ongoing progress in elevating our team, our processes, and our performance, we view the current climate as another opportunity to distinguish ourselves from our competition and how we serve our customers and patients globally as we continue marching towards becoming a $1 billion, high growth, high margin, high cash flow company that generates significant value for all of our stakeholders. Now I'll turn the call over to Mark.