Integra LifeSciences Holdings Corporation

Good day and welcome to the Integra Life Sciences second quarter 2024 financial results. At this time, all participants are on listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question, please press star 1-1. As a reminder, this call is being recorded. I would like to turn the call over to Chris Ward, Senior Director, Investor Relations. Please go ahead.

Thank you. Good morning. you for joining the integral life sciences second quarter 2024 earnings conference call with me on the call are stuart essek executive chairman john dewitt president and chief executive officer and leah knight chief financial officer earlier this morning we issued a press release announcing our second 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 Second 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 Tax Reports filed with the SEC and in the release. Also in our prepared remarks, we will reference reported inorganic revenue growth and inorganic revenue growth excluding losses. Organic revenue growth excludes the effects of foreign currency, acquisitions, and divestitures. Organic revenue growth excluded in 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. Lastly, our comments today will include certain non-GAAP financial measures, reconciliations of non-GAAP financial measures in today's press release, which is an exhibit to Integra's current report on Form 8K filed with the SEC. And with that, I will now turn the call over to Stuart.

Thank you, Chris. Before Jan and Leah begin with the investor presentation and Q&A, I'd like to say a few words about the business and the path forward. We had a good second quarter, which John and Leah will cover in more detail shortly. We appreciate, however, that much of your focus today will be on our guidance and performance for the rest of the year and what lies further ahead. So I'll address that first before handing the call to them. Integra has a very strong commercial team armed with a differentiated portfolio. That said, over the last several quarters, we've identified a series of operational and quality systems gaps. As a result of both the typical audit by regulatory agencies, as well as our own in-depth reviews of the state-of-art broader quality system, it has become clear that there is a need to bolster our manufacturing quality compliance processes across the organization. What has arisen from these evaluations is our compliance master plan. a systemic and holistic approach to improving our quality system, and GMP compliance across our manufacturing and supply network. The plan will drive increased spending in the second half of 2024 and lower revenue and EPS expectations for the year. As reflected in our updated guidance this morning, there are revenue impacts resulting from several shipping holds that we have put into place to assess and confirm product labeling and regulatory compliance. It is worth noting that while this impacts revenue in the third quarter, we are preparing to resume shipping many of those products later in the year. Over the next 18 months, the planned investments will elevate our operations and compliance processes to enable our product supply to match our customer demand and will allow our entire organization to execute to our potential. Additionally, we have formed a quality committee at the board of directors level that will have regular direct lines of communication to the ELT members responsible for operations, quality, and regulatory. I want to assure all of our stakeholders that we are giving these issues the attention they deserve. We recognize that this will come at the expense of earnings growth in the near term, but it is necessary and will support sustainable long-term growth through predictable execution. During this time, we will continue to focus on getting our products into the hands of our customers growing our business globally, and improving our new product development capabilities. We have continued to make excellent progress on our CEO search and believe we will have a new CEO announced and in place by the end of this year, if not sooner. There has been tremendous interest in the role, given the company's exciting, life-saving products, aggressive growth strategy, and financial strength. The board and I, working with Hydric and Struggles, are spending a significant amount of time interviewing candidates selected from an impressive list. I am very confident we will bring on board a highly qualified individual capable of both driving our longer-term strategy and executing on our current operating and commercial commitments. Once the new CEO is in place and has had the appropriate time to make an assessment, we'll provide more color on the LRP for the business. The board and management team believe in our product portfolio and the long-term growth prospects that go along with it. While recently we haven't delivered to our potential, we still believe we can meet or exceed market growth. We are committed to making necessary investments in our quality and manufacturing operations to enable supply to sustainably meet that demand. Integra remains a leader in neurosurgery and tissue technology, with the largest regenerative portfolio in the market. And we now have a great portfolio of ENT products as a result of the McLaren acquisition. Over time, we have built a portfolio that not only has significant breadth, as well as valuable technology and commercial synergies, but also provides meaningful differentiation to our customers and their patients. I would like to thank and acknowledge our employees for their resilience and thank our customers and shareholders for their continued support of Integra. And with that, I'll turn it over to Jan and Leah to discuss our second quarter and updated guidance in more detail.