Henry Schein, Inc.

Good morning, ladies and gentlemen, and welcome to the Henry Schein First Quarter 2021 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 touchtone 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's 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 2021 first quarter. With me on the call today are Stanley Bergman, Chairman of the Board and Chief Executive Officer of Henry Schein, and Steven 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 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 IR 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, May 4th, 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 that we have allotted for this call. With that, I would like to turn the call over to Stanley Bergman.

Thank you, Carolyn. Good morning, everyone. Appreciate everyone calling in today. We're obviously very pleased with what we view as an exceptional first quarter for our global financial performance for the year 2021. versus the comparable period last year, but also versus the first quarter of 2019. These good results are based on excellent planning and execution across all of our businesses. Our team really came through for our customers, for our investors, for our suppliers during 2020 and now the first quarter of 2021. We also delivered very strong operating margins for the quarter. While in markets in most geographies still face challenges due to the ongoing pandemic, the overall global market recovery and our improving results have continued. Our positive momentum reflects the adaptiveness of our business model and as I noted, a deep commitment of Team Shine members across the board to our customers and, in fact, the communities that we serve. Throughout these unprecedented times, Henry Shine has remained focused on the safety of our team above all, and yes, responding to our customers' needs, which were extremely varied across the world and went up and down as dynamics changed in an extremely dynamic environment. We of course continue to drive innovation across the platform. We gain market share, enhancing our margin, and yes, focused on optimizing our cost structure as we have for many years. We believe all this positions us well to continue to drive earnings growth, and create value over the long run. Our steady way in which we have driven the business for decades remains very much intact with very good momentum. In line with improving in-market conditions, in the fourth quarter of 2020, we resumed acquisition activity. We have a lot of activity going on. Of course, no deal is completed until it's actually signed and inked. and will then be reported on. In the first quarter of 2021, we closed five acquisitions across our dental, medical, and technology and value-added services businesses across basically the company with the aggregate sales of nearly $140 million, reflecting our commitment to a balanced strategy that supplements solid organic growth with acquisition contributions. In addition, during the first quarter, we resumed share repurchases. The bottom line is that our solid cash flow enables us to invest in our business, reflecting our goal to continue to deliver an attractive return on capital. I will remind shareholders that we're into our 26th year as a public company, reflecting compounded annual growth of 12%. on a non-GAAP basis, and an increase in stock price of a similar number over this period on a compounded annual growth basis. Now, returning to the current moment, the latest survey data published by the American Dental Association for the U.S. shows that dental practices are approximately 87% of pre-COVID-19 patient volume, a data point that continues to improve And we are experiencing improvements throughout the system, specifically in the U.S. The ADA remains bullish on the outlook for the dental profession in the months ahead, as vaccinations likely hit a tipping point. The ADA also recently issued a report after partnering with Back to Normal Barometer to gain insights on customer sentiments related to dentistry. The survey found that a vast majority of patients who have not already visited the dentist this past year are ready to return. As you know, we also closely monitor Henry Schein U.S. dental e-claims data as a directional indicator, and we have a decent amount, market share of that data, of those claims processed. This data continues to show that patients are returning to practices for a broad set of oral care procedures, and most recently, including the hygiene arena. In addition, our medical customers have been resilient throughout this pandemic, and we are committed to helping our practitioners, both dental and medical, ensure patients can safely return to routine care, as well as elective procedures and, of course, non-elective procedures. As COVID-19 cases decline and more people are vaccinated, we expect to see patient traffic to physician offices and ambulatory surgery centers normalized, although I must stress that we're not back to where we were with elective ambulatory surgical procedures. There's a lot published on this, and also the normal rate of vaccinations for our practitioners is somewhat down, since the volume, including pediatric visits, is down, but it's slowly catching up to the 2019 volumes. Henry Schein has been deeply involved in efforts to promote more effective participation of primary care physicians and other office-based practitioners, including dentists in many states who are allowed to administer the vaccination, and we are committed to driving vaccination rates nationwide with a particular focus on office-based practitioners. While many states provide these practitioners with access to the vaccine, it is extremely difficult and a complex process for office-based practitioners to receive an allotment of these vaccines. And at present, only about a third of primary care physicians are able to offer the vaccine to their patients across the nations. COVID-19 vaccination efforts to get shots in the arms of the U.S. citizens have been quite extraordinary thus far. However, we also recognize that the country is now in a race against the variants. We continue to see equity challenges in the uptake of the vaccine, and there continues to be a high rate of vaccine hesitancy in some areas of the country. We also recognize that the nation will swiftly need to prepare for for delivery of booster vaccines and, yes, pediatric vaccination. Henry Schein has been working closely with the U.S. Department of Health and Human Services, FEMA, the CDC, state and local authorities, urging authorities to more effectively include primary care physicians and other office-based practitioners, as I noted, including dentists, by utilizing the existing and well-established distribution network to deliver vaccine to these providers. As part of this effort, we recently submitted a letter to the U.S. House Select Committee on the Corona crisis. We firmly believe that primary care physicians are a vital resource in the COVID vaccination effort because of the high level of trust they enjoy amongst patients, their understanding of patients' health history and personal circumstances, and their physical presence in every community around the country. The vast network of physicians and dentists in the U.S. can be immediately activated and, of course, literally overnight, more effectively activating the cadre of health professionals who are highly trusted leaders in their communities to vaccinate Americans through their practices. This is critical at this moment in the country's vaccination efforts to help overcome hesitancy, to address at-risk populations, reduce health inequities, and ultimately ensure more patients are vaccinated. At the same time, more must be done to help other countries that face shortages of these critical vaccines, as equitable global access is crucial to ending the pandemic and the safety of the world's population, including Americans. Through our work with the World Economic Forum and our partnership with the Pandemic Supply Chain Network, Henry Schein has been working to support COVAX, the international entity led by CEPI, Gavi, and the World Health Organization, UNICEF, to accelerate access to the COVID vaccine in low and middle income countries around the world. So the business is in good shape. We continue to have very good momentum. We've been reporting on our results throughout this period in a little bit more detail than in the past and continue to be very optimistic the direction of the pandemic at the moment, although there are some setbacks in countries like India, and we are well-positioned and continue to be well-positioned to help combat the pandemic and at the same time increase shareholder value. With that, I'll hand the call over to Stephen to discuss our quarterly financial performance, and I'll provide some additional commentary on current business conditions and our market. Stephen, please.