Omnicell, Inc.

Ladies and gentlemen, thank you for standing by and welcome to the OmniSale Inc. fourth quarter fiscal 2021 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star one. Thank you. Kathleen Nemeth, head of investor relations. You may begin your conference.

Good afternoon and welcome to the Omnifil Fourth Quarter and Full Year 2021 Financial Results Conference Call. On the call with me today are Randall Whipps, Omnifil Chairman, President, CEO and Founder, Scott Seidelman, Executive Vice President and Chief Commercial Officer, and Peter Kuipers, Executive Vice President and Chief Financial Officer. This call will contain forward-looking statements, including statements related to financial projections or other statements regarding OmniCell's plans, objectives, expectations, targets, or outlooks that are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied. For a more detailed description of the risks that impact this forward-looking statement, please refer to the information in our press release issued today, in the on-resale annual report on Form 10-K filed with the SEC on February 24, 2021, and in other more recent reports filed with the SEC. Please be aware that you should not place undue reliance on any forward-looking statements made today. Our results were released this afternoon and are posted in the Investor Relations section of our website at omniscell.com. Additionally, we'd like to remind you that during this call, we will discuss some non-GAAP financial measures. Reconciliation of these non-GAAP measures to the most comparable GAAP financial measures are included in our financial results press release. With respect to forward-looking non-GAAP measures, such as guidance and targets, we do not provide a reconciliation for forward-looking non-GAAP measures to the comparable GAAP measures on a forward-looking basis, as these items are inherently uncertain and difficult to estimate and cannot be predicted without unreasonable effort. I will now turn the call over to Randall.

Good afternoon, and thank you for joining us today. 2021 was another outstanding year for Omnicell, as strong customer demand for our differentiated, technical-enabled, and cloud-based medication management products and inherent solutions exceeded our expectations across all metrics. We believe our business is resilient, and our innovation growth strategy is delivering results. We delivered a record $1.22 billion and bookings for the full year compared to $1.0 billion for 2020. This was a year-over-year increase of 21%, exceeding the top end of our guidance by $47 million. Demand for our advanced services portfolio was exceptionally strong and exceeded our plan for the year. As a reminder, advanced services includes our SaaS, subscription software, and tech-enabled services. Our 2021 non-GAAP revenues of $1.13 billion were also a record for the company, increasing $241 million, or 27%, from 2020. And we are entering 2022 with a record backlog of $1.25 billion. We increased our total number of long-term sole source partnerships to 151 of the top 300 U.S. health systems, an increase of six from 2020. Many of these were competitive conversions. In addition to increasing the number of sole source partnerships, we're seeing an increase in average booking size. In fact, we booked three of the largest deals in our history in 2021. As a trusted partner, we develop solutions that we believe will continue to elevate our critical role in the pharmacy health system. To that end, we're excited to announce that OmniCell is partnering with Long Island University to launch pharmacy simulation centers that prepare the next generation of pharmacy leaders. This immersive experience goes live later this year and will provide the opportunity for more than 200 pharmacy residents and technicians to become certified in the innovative technologies, systems, and workflows that will help them navigate the challenges of medication management and shift their focus to clinical care. These centers will also be used to train and certify omni-cell pharmacy technicians as well as pharmacy students who will go on to support our customers and their technology onsite. We're excited to launch this initiative and look forward to providing updates on our progress on future earnings calls. The critical role automation and digitization play in addressing the healthcare labor shortage Ensuring access to care and improving patient outcomes is becoming recognized by our healthcare system partners and retail customers even more strongly today. The pandemic led to increased demand for care, causing heavier workloads for healthcare and pharmacy workers, which in turn resulted in worker burnout and resignations. According to the U.S. Bureau of Labor Statistics, from February 2020 to September 2021, the healthcare sector lost 524,000 workers from an already aging workforce. And with the continued high demand for administering COVID-19 vaccines, tests, and treatments, the nationwide acute shortage of pharmacy technicians has adversely impacted both hospitals and retail pharmacies. Moreover, patient volume is projected to rebound and exceed pre-pandemic levels. McKinsey and Company survey of 100 large private sector hospitals, which was conducted several months prior to the emergence of the Omnicom variant, concluded that on average, hospitals' inpatient admissions have returned to 2019 levels and predicted that inpatient admissions would increase by 4% in 2022 relative to 2019. Thus, not surprisingly, a recent American College of Healthcare Executive survey of 310 community hospital CEOs found that personnel shortages were their top concern in 2021, marking the first time since 2004 that financial challenges were not executives' primary concern. We believe we are uniquely positioned to assist our customers in addressing these labor challenges by implementing an automated and cloud-based comprehensive medication management and adherence platform, reducing the manual processes within pharmacy workflows and enabling pharmacists to practice at the top of their license. In 2019, at our Investor Day at the ASHP Mid-Year Clinical Meeting, We outlined our plan to fundamentally transform our business toward building the IoT of medication management to support the industry vision of a fully autonomous pharmacy. We believe the results we achieved in 2021 demonstrate that our strategy is working. And while we still are in the early innings of this strategy, we are very pleased with the level of customer interest, which is ahead of our initial expectations, as well as the value we find we are already creating for our healthcare system partners and retail customers. In our opinion, the broad adoption of these new services and cloud-enabled SaaS solutions validates our decision to take the path toward transforming the pharmacy care delivery model. Now, turning to how we expanded our advanced services portfolio over the past year with three strategic accretive acquisitions. FDS Amplicare, Market Touch, and Recept. We are pleased with the early momentum and progress we are making in strengthening our market position through value-enhancing M&A. In December, we announced our agreement to acquire Recept, which is a leading provider of specialty pharmacy management services for health systems, clinics, and physicians groups. This acquisition is expected to open a new market for OmniCell and will expand OmniCell's portfolio of capabilities and advanced services that are designed to address the significant need to improve access to and management of complex medications. In January, we announced our acquisition of pharmacy software solutions provider Market Touch, which will expand and deepen and liven health's footprint across key pharmacy segments. Each of these acquisitions are strong additions to our Alive & Health and 340B solution sets. Scott will speak more about how these companies have strengthened our competitive offering in just a moment. Looking ahead, we also intend to continue strengthening our market position through our robust innovation pipeline. From next-generation IV robotics to new SaaS and connected device capabilities, We are very proud of the advancements we have made. We expect to launch new next-generation IV robotics in the coming months and are very excited about the years ahead. As I noted earlier, 2021 was an outstanding year. And yet, despite the records we have set across a number of financial metrics, we are not immune to the inflationary headwinds and supply chain constraints that others are also seeing. As we indicated last quarter, we have been taking and will continue to take steps in an effort to address and offset these challenges. Despite current headwinds, we are entering 2022 with significant momentum and expect to deliver profitable growth and value creation in the year ahead. 2022 marks the 30th anniversary since our founding. It is a milestone we will be celebrating throughout the year. Over the last 30 years, we have successfully navigated through many difficult economic cycles and believe we will do the same in this current cycle. Our focus on creating long-term, enduring value for all of our stakeholders and transforming the pharmacy care delivery model continues to inspire and guide us. We are confident in the opportunities ahead of us and look forward to updating you on our progress. Now, before I turn the call over to Scott, I would like to say how pleased we are that the OmniCells environmental, social, and governance efforts have been recognized by Sustained Analytics, one of the largest providers of ESG research, ratings, and analytics. In their most recent report, OmniCell ranked higher than 89% of other companies in the healthcare industry for ESG risk management, which acknowledges our company's tremendous efforts and improvements in this area. Sustain Analytics also rated OmniCell number one for lowest risk among our peers. remain focused on innovating to drive sustainability across our business, ethically and responsibly sourcing materials by adhering to international recognized OECD guidance, and elevating our diversity and inclusion initiatives. Now, with that, I'd like to turn the call over to Scott to discuss the industry landscape and key customer engagements. Scott?