Integra LifeSciences Holdings Corporation

Good day and welcome to the Integra Life Sciences first quarter 2022 financial results. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Chris Ward, Senior Director, Investor Relations. Please go ahead, sir.

Thank you, Cecilia. Good morning, and thank you for joining the Integra Life Sciences first quarter 2022 earnings conference call. Joining me on the call this morning are Jan DeWitt, President and Chief Executive Officer, Glenn Coleman, Chief Operating Officer, and Carrie Anderson, Chief Financial Officer. Earlier today, we issued a press release announcing our first quarter 2022 financial results. The release and corresponding earnings presentation, which we will reference during the call, are available at integralife.com under Investors, Events and Presentations, and the file named First Quarter 2022 Earnings Call Presentation. Before we begin, I would like to remind you that many of the statements made during this call may be considered forward-looking statements. Factors that could cause actual results to differ materially are discussed in the company's Exchange Act report filed with the SEC and in the release. Also in our prepared remarks, we'll make reference to both reported and organic revenue growth. Organic revenue growth excludes the effects of foreign currency acquisitions, including ASEL, for the first 19 days of the year, divestitures, as well as discontinued products. Unless otherwise stated, all disaggregated and franchise-level revenue growth rates are based on organic performance. And lastly, our comments today will include certain non-GAAP financial measures. Reconciliations of any non-GAAP financial measures can be found in today's press release, which is an exhibit to INTEGRA's current report on Form 8-K, filed today with the SEC. And with that, I'll now turn the call over to Jan.

Thank you, Chris, and good morning, everyone. Let me start by providing a review of our first quarter business highlights on slide four. Definitely a quarter we feel good about, and that is reflective of a strong start to the year. Our first quarter revenues finished at around $377 million above the high end of our guidance range and with organic growth above 5%. You will remember that in mid-February, we went in with cautious guidance for the first half of the year. Although we felt confident about our capabilities at that time, we had very few data points on exactly how and until when our markets and operations would be impacted by the Omicron disruption, and also how they would ease toward the next level of normality after the peak of that disruption passed. Our better-than-expected revenue resulting Q1 was driven by a stronger-than-expected recovery in surgical procedures across the globe in March, as well as by favorable order timing in our private label business. We saw demand for our products steadily increase, starting in early March, while agility in our commercial teams and operations allowed us to keep up with strengthening demands late in the quarter. Our growth in the first quarter was broad-based, with both our Codman specialty surgical and our tissue technology segments at or exceeding 5% organic growth, and with strong contributions from both our US and international markets. Our first quarter adjusted earnings per share of 74 cents also exceeded the high end of our guidance range driven by the higher revenue and with gross margins improving 40 basis points compared to Q1 of 2021. We're pleased that the increasing utilization of our factories combined with margin protection measures taken by commercial supply chain and procurement teams succeeded in protecting our margins. despite the inflationary environment. And we intend to maintain this margin focus throughout the year. As we think about the full year, we feel more optimistic now, but still tempered with continued caution around microeconomic-driven uncertainties, including interest rate hikes, geopolitical instability, and further risk from COVID disruptions like what we are seeing in China at this moment. We expect surgical procedures will continue to steadily improve through the balance of the year with more normal seasonal patterns. And while we anticipate continued ripples on the supply side of our operations due to some of these macro factors, we should see improving trends in our operations over the balance of the year. As a result of our strong start and balanced outlook for the remainder of the year, we are increasing our organic growth expectations for the full year to a range of 3.8 to 5.2%, compared to our initial range of 3.5 to 5%. Reported revenue guidance remains the same as our family guidance, as we are absorbing additional currency headwinds as the dollar continues to strengthen. We're also reaffirming our full year guidance for adjusted EPS. Our Q1 performance, as well as the resilience in our organization, provides us a solid foundation for continuing to invest in our future in order to accelerate the business to a next level of performance over the coming years. During the first quarter, we invested in our organizational capabilities and capacities, as well as our growth catalysts, and we initiated a number of strategic roadmap projects. Also, in the first quarter, we launched NeuroGen3D, our new peripheral nerve repair product, and we continued our global rollout of Serolink in Canada, Australia, and several indirect markets. Finally, we completed the accelerated share repurchase program we previously announced, and as a result have returned $125 million to our shareholders, keeping up with our track record of strong financial rigour. With that, I would like to turn the call over to Carrie now to go deeper into our first quarter performance and our updated guidance.