Henry Schein, Inc.

Good morning, ladies and gentlemen, and welcome to the Henry Schein Third Quarter 2021 Earnings 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 Start key followed by the 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, Graham Stanley, Henry Schein's Vice President of Investor Relations and Strategic Financial Project Officer. Please go ahead, Graham.

Thank you, Operator, and my thanks to each of you for joining us to discuss Henry Schein's results for the 2021 third quarter. 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 message referred to in forward-looking statements. As a result, the company's performance may be clearly different 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 filing for the Securities and Exchange Commission. including in the risk factor 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 analyses 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 replacements 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. Lastly, the content of this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, November 2nd, 2021. Any Shine undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances as to the date of this call. limit yourself to a single question in the follow-up during Q&A to allow as many listeners as possible to ask a question within the one hour we have left for this call. With that said, I would like to turn the call over to Stanley Bergen.

Thank you very much, and congratulations on your appointment as head of our investor relations, and of course, thank you for all you've done for the company over the last dozen plus years. So, Good morning to everyone, and thank you for joining us. Really, really happy today to report record third quarter financial results, driven by a keen focus on execution by the team. And the team has done a remarkable job since the virus, the pandemic started back in March of 2020. And of course, there was a steady patient traffic pattern during this quarter, which also contributed to the very good, actually the excellent results. And we have excellent momentum across the entire company. So if we compare the results of sales to a year ago, Henry Schein's worldwide internal sales, that's in local currencies, increased a robust 7.2%. But what's really important, if you exclude the sales of PP&E and COVID-19 related products, the results are up 6.3%. That's the internal sales growth in local currencies. We believe that patient traffic was generally similar to the previous quarter for our dental customers. That's in the United States and globally. Small adjustments in different parts of the world. but not material, and definitely the pattern is improving for our medical customers. We mentioned in previous calls that visits to physician offices had gone down compared to 19, and definitely in ambulatory surgical centers as well. We see this traffic as increasing again. In mid-September, we announced important changes to our senior distribution business leadership structure. And let me comment on these changes before I review the third quarter performance for each of our business groups. Actually, Stephen will do that first, and then I'll provide additional comments later. We have been pursuing an umbrella strategy, which we internally refer to as one distribution, as part of the continuous operational improvement of Henry Schein as a company. More tightly, the strategy of one distribution more tightly integrates the management of our distribution businesses globally. A newly announced structure, which we've been working on for about 18 months, seeks to harness the benefits of consolidating the management of Henry Schein Dental and medical distribution businesses in two regions, two geographies, North America, and the rest of the world, international. One distribution will better position our management team to leverage functions, talent, processes, and, yes, systems across Henry Schein's global distribution businesses. These changes are designed and expected to accelerate improved efficiency and, of course, That's been a goal of Henry Schein for decades to improve efficiency, but we're really focused on it now more than ever and actually doing a pretty good job at that. But I believe that this new management structure will advance our efficiency as an organization globally. But also, and quite importantly, the new structure will allow us to enhance the customer experience by operating in a more efficient manner. There's just no question that COVID, this period, this COVID period, has increased customers' expectations on the customer experience. And we are committed to fulfilling those expectations and, in fact, exceeding them. Furthermore, these changes recognize the fact that medicine and dentistry are both part of the care of continuum. And we've been talking about this for years as well. but it's really coming much closer together, the notion that medicine and dentistry are aligned in prevention and wellness. And today we have a small but nevertheless increasing amount of overlap between the two customer sets. We're starting to see practices emerge that are servicing both sides, dentistry and medicine. We're starting to see our electronic medical records in dental schools for dentistry, in practices, starting to connect in an interoperable way with medical records. So this whole notion of the integration of oral care and medicine is advancing and we are aligned in this whole area of wellness and prevention, which is so important to providing better quality of care at a more competitive price or lower price, so-called value healthcare chain. Now, our software, specialty products, and practice services businesses are also reflective of Henry Schein's long-standing commitment to help customers operate more efficient practices and support clinical care. We are continuing to sharpen our focus on these faster growing and higher margin markets through organic growth, and as you'll hear later already, through some very interesting strategic acquisitions which we made just this year, and we will add to that. The whole notion that software, specialty products, and practice service activities, those three business areas align With our one distribution strategy, different management teams, different focus, the whole idea is to provide better customer service while at the same time driving up our margins, our operating margins as well. Our customers increasingly rely upon Henry Schein's comprehensive offering of innovative solutions and services along with our distribution network for their continued success. in what is clearly a much more digital world than we went into in March of 2020. We believe we have a most accomplished leadership team in place in our businesses across the world, both on the distribution side and in the software specialty products and practice services businesses side. They're ready to satisfy the needs of our customers, improve the experience, drive down cost, and at the same time, therefore, provide an increased operating income and so create shareholder value. With these opening comments, I'd like to hand the call over to Stephen to discuss our quarterly financial performance and guidance, which we are now providing for the remainder of 2021 and, yes, for 2022 as well. Then I'll provide some additional commentary on the current business conditions and our markets. Stephen, please.