Integra LifeSciences Holdings Corporation

Good day and welcome to the Integra Life Sciences first quarter 2024 financial results conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Mr. Chris Ward, Senior Director, Investor Relations. Please go ahead.

Thank you, Cherie. Good morning, and thank you for joining the Integra Life Sciences first quarter 2024 earnings conference call. With me on the call are Jan DeWitt, President and Chief Executive Officer, and Leah Knight, Chief Financial Officer. Earlier this morning, we issued a press release announcing our first quarter 2024 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 a file named First Quarter 2024 Earnings Call Presentation. Before we begin, I want to remind you that many of the statements made during this call may be considered forward-looking. Factors that could cause actual results to differ materially are discussed in the company's Exchange Act reports filed with the SEC and in the release. Also in our prepared remarks, we will reference reported and organic revenue growth and organic revenue growth excluding Boston. Organic revenue growth excludes the effects of foreign currency, acquisitions, and divestitures. Organic revenue growth excluding Boston excludes revenues from products manufactured in our Boston facility in both periods. Management believes that excluding revenue from all products manufactured at the Boston plant provides useful information when evaluating the company's organic growth because of the unusual nature of the manufacturing stoppage and voluntary global recall. 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 non-GAAP financial measures can be found in today's press release, which is an exhibit to Integra's current report form, 8K, filed with the SEC. And with that, I will now turn the call over

Thank you, Chris, and good morning, everyone. It's a pleasure to be here together with Leah to update you on our first quarter results and guidance for the year. Let me start by saying the performance during this period reflected robust market demands, the contribution of having a broad and diversified product portfolio, and solid execution by our integral colleagues around the world to deliver our 2024 key priorities and progress, our strategy. If we move to slide number four, our first quarter revenues finished at $369 million above our February guidance range, partially driven by orders that closed earlier than forecasted. Organic revenue was down 2.5% compared to the prior year, primarily due to the Boston revenue included in the first quarter of 2023. Excluding Boston, organic growth was 1.6%. we delivered adjusted EPS of 55 cents within our guidance range. Our couple months specialty surgical business saw a strong start to the year, moving 4.1% and in line with our growth expectations for this business. This performance was driven by several of our leading products and brands in CSF management, durable access and repair, and neuromonitoring. In addition, We saw continued strength in our international markets, which have delivered consistent high signal to low double-digit growth. We expect to continue to build on this momentum in our international markets as we expand access to our products in new markets and broaden our commercial reach and capabilities. We also completed the global relapse of Serrelink in the quarter. We're pleased with the strong market uptake demonstrating resilience and differentiation of our intracranial pressure monitoring portfolio. Furthering our legacy of strategic M&A to broaden our impact, we recently closed our acquisition of Clarence, a pioneer in ear, nose, and throat surgical interventions. This deal positions Integra as a leader in the ENT segment, expands our addressable market, and provides immediate scale and accretive growth to our portfolio. Eclarent's strong commercial capabilities, R&D expertise, advanced portfolio, and deep clinical knowledge will be important synergistic assets for Integra, enabling us to deliver transformative technologies to restore patients' lives. We're excited to welcome our new Eclarent colleagues. Together, we will make a profound impact on ENT and neurosurgical care. Within our tissue technologies business, we continue to see healthy demands for our broad portfolio of wound reconstruction products. We deliver triple-digit growth in Durasorb, and we're tracking ahead of our deal model. Leveraging another recent acquisition, we further expanded our UBM wound care platform with the launch of Micromatrix Flex, a dural syringe system enabling the convenient mixing and precise delivery of micromatrix-based in complex ones. As we outlined during our February call, production of Integra skin was not able to keep up with strong demand, leading to a 4.4% sales decline in tissue technologies excluding Boston. Moving on to Boston. We completed the external audit of the Boston plant and received a final report from the third-party auditor in March. You will recall that this audit was required by the FDA as part of our process to address the warning letter observations and resume production. While we anticipated this audit would yield findings and that there would be work left to complete, the audit report contained more findings than we anticipated. We're still determining the full scope of the work required to address these findings and to resume commercial distribution. Based on our preliminary assessment, we no longer expect to resume commercial distribution in 2024. We remain fully committed to resolving the issues in Boston and bringing the products back to the market for our customers and patients. Turning to guidance, we're updating our revenue guidance for the year to a range of 1.67 to $1.69 billion, reflecting the contribution of three-quarters of revenue from McLaren and the removal of all 2024 revenues for Sorgement and Primatrix. We are also updating our full-year adjusted earnings per share to a range of $3.01 to $3.11 per share to reflect supply chain challenges and the removal of the Boston revenues. Leah will provide more color on our updated guidance for the second quarter and the full year. Now before I turn the call over to Leah, let me assure you we're deeply focused on fixing our supply issues and returning the Boston portfolio to the market. We remain committed to realizing Integra's full potential by serving our robust markets through the strength of our broad and diversified portfolio and making strategic investments in inorganic opportunities, like a Clarence, to broaden our portfolio and our reach. Our first quarter results and full-year, mid-single-digit organic growth guidance reflect the progress we are making. Now over to Leon.