Integer Holdings Corporation

Thank you for standing by. My name is Michelle, and I will be your conference operator today. At this time, I would like to welcome everyone to the Integer Holdings Corporation first quarter 2023 earnings release conference 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, Press star 1 again. Thank you. Mr. Andrewson, you may begin.

Good morning, everyone. Thank you for joining us, and welcome to Integer's first quarter 2023 earnings conference call. With me today are Joe Dziedzic, President and Chief Executive Officer, and Jason Garland, Executive Vice President and Chief Financial Officer. As a reminder, the results and data we discussed today reflect the consolidated results of Integer for the periods indicated. During our call, we will discuss some non-GAAP financial measures, For reconciliation of these non-GAAP financial measures, please refer to the appendix of today's presentation, today's earnings press release, and the trending schedules, which are available on our website at integer.net. Please note that today's presentation includes forward-looking statements. Please refer to the company's SEC filings for a discussion of the risk factors that could cause our actual results to differ materially. On today's call, Joe will provide his opening comments, and Jason will then review our financial results for the first quarter of 2023. and provide an update on our full year 2023 guidance. Joe will come back to provide his closing remarks, and then we will open up the call for questions. With that, I will turn it over to Joe.

Thank you, Andrew, and thank you to everyone for joining the call today. In addition to KeyBank and Benchmark, we are excited to welcome sell-side analysts from Piper Sandler and Bank of America, who have recently initiated coverage on Integer. We appreciate the coverage from all the sell-side analysts, and are excited by the opportunity to reach more potential investors. In the first quarter, we delivered strong year-over-year results. Sales grew 21% organically, with strong double-digit growth across all product lines. Our adjusted operating income grew 28%, generating nearly 70 basis points expansion of adjusted operating income as a percentage of sales compared to last year. First quarter sales were stronger than we expected driven primarily by the recovery of the delayed shipments from the second half of last year. Although we largely caught up on those delayed sales, the supply chain environment remains challenging overall. On a positive note, we are continuing to reduce our direct labor turnover and are largely at the headcount levels we need to deliver on our high single-digit organic sales growth this year. We are reiterating our full-year outlook. We expect our organic sales growth to be 7 to 9%, which is about 300 basis points above the growth rate in the markets we serve. We expect adjusted operating income to grow 10 to 16% year-over-year. We are also confirming our free cash flow guidance of $70 to $90 million, a strong year-over-year increase. The strategy we developed in 2017 and began implementing in 2018 is now producing projected sustained above-market sales growth and margin expansion in what remains a challenging supply chain environment. It is an exciting time at Integer because demand remains incredibly strong, we are making the investments needed to deliver sustained growth, and we have a strong pipeline of new products concentrated in faster-growing end markets. I am grateful for our associates around the world that are delivering for our customers and making a difference for patients. I'll now turn the call over to Jason.