Henry Schein, Inc.

Good morning, ladies and gentlemen, and welcome to the Henry Schein Fourth Quarter 2020 Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. If anyone should require assistance during the call, please press the star key followed by zero on your touch-tone phone. As a reminder, this call is being recorded. I would now like to introduce your host for today's call, Carolyn Borders. Henry Schein, Vice President of Investor Relations. Please go ahead, Carolyn.

Thank you, Regina, and my thanks to each of you for joining us to discuss Henry Schein's results for the 2020 fourth quarter and full year. With me on the call today are Stanley Bergman, Chairman of the Board and Chief Executive Officer of Henry Schein, and Stephen Palladino, Executive Vice President and Chief Financial Officer. Before we begin, I would like to state that certain comments made during this call will include information that is forward looking. As you know, risks and uncertainties involved in the company's business may affect the matters referred to in forward looking statements. As a result, the company's performance may materially differ from those expressed in or indicated by such forward looking statements. These forward looking statements are qualified in their entirety by the cautionary statements contained in Henry Schein's filings with the Securities and Exchange Commission, including in the risk factors section of those filings. In addition, all comments about the markets we serve, including end market growth rates and market share, are based upon the company's internal analysis and estimates. Our conference call remarks will include both GAAP and non-GAAP financial results. We believe the non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable the comparison of financial results between periods where certain items may vary independently of business performance, and allow for greater transparency with respect to key metrics used by management in operating our business. These non-GAAP financial measures are presented solely for informational and comparative purposes and should not be regarded as a replacement for corresponding GAAP measures. Reconciliations between GAAP and non-GAAP measures can be found in the supplemental information section of our investor relations website and in exhibit B of today's press release, which is available in the investor relations section of our website. The content of this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, February 17th, 2021. Henry Schein undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. please limit yourself to a single question and a follow-up during Q&A to allow as many listeners as possible to ask a question within the one hour we have allotted for this call. With that said, I would like to turn the call over to Stanley Bergman.

Good morning. Thank you, Carolyn. Thank you all for participating in today's call. Against the backdrop of a most challenging year in our history due to the COVID pandemic, With unprecedented human toll and economic impact worldwide, we were successful in supporting practices that were initially open for emergency services and also assisting customers preparing to restore practices to increased operating capacity as restrictions eased. Henry Schein's unwavering focus on our customers, along with our resilience and agility, enabled us to deliver fourth quarter total sales growth of 18.6%, capping off record total sales for the second half of 2020 as our end markets have rebounded. Our teams are working tirelessly to execute against our plans. We recognize the commitment and sacrifice of Team Shine members globally and wish to sincerely thank the team for the continued commitment the team brings to Henry Shine each day. Dental patient traffic has remained at stable levels compared to the third quarter of 2020, even in countries experiencing more stringent lockdown rules, with the exception of the UK. To date, the overall recovery is continuing. Specifically in the United States, the latest survey data published by the American Dental Association for the US shows that dental practices are at close to 80% of pre-COVID patient volumes. That's patient traffic. These patient volumes represent a slight increase over the past couple of months of ADA survey data, which we believe is reasonably accurate. Henry Schein's U.S. dental e-claims data also show that patients continue to return for a broad set of oral care procedures. We also believe overall patient volumes in medical are still at relatively stable levels, In fact, we are pleased to report that for the second quarter in a row, our global medical business has achieved over $1 billion in quarterly sales. Over time, our dental and medical customers, we believe, will experience patient traffic that will improve to pre-COVID-19 levels. We are pleased with our non-PPE and COVID-related sales for the fourth quarter, in both dental and medical in the United States and abroad, but also expect PPE and COVID-19-related sales to continue at the elevated levels to support standard of care followed by practitioners. So although we are pleased with our non-PPE sales, and we did experience significant increase in PPE and COVID-related sales, we do expect that PPE and COVID-related sales will continue at these elevated levels beyond this year, or beyond the end of 2020, into 2021 and beyond. So despite this very difficult past year, we remain optimistic about our future, and our financial position is strong. We remain confident that Henry Schein is well positioned for future continued success given the breadth of our products, services, and supplier and team Schein support across the global dental and medical markets. Today, we will review the specifics of our financial results, discuss key achievements in 2020, provide our perspective on the state of our end markets, and speak to our strategic focus while providing guidance for 2021, of course, bearing in mind that we are still in the midst of a pandemic. However, before Stephen offers his remarks, I would like to clarify a point related to the impact of non-cash, non-recurring intangible assets impairment charge of just over $18 million that we announced today. This impairment charge was accorded within our operating expenses impacting our operating margins by 57 basis points. It should, of course, be noted that this impairment charge reduced both GAAP EPS and non-GAAP EPS by 7 cents. With that, I'll ask Stephen to discuss our quarterly and full-year financial performance, and then I'll provide some additional comments on the current business conditions, our markets, and where we're heading. Stephen, please.