Envista Holdings Corporation

I will be your conference call facilitator this afternoon. At this time, I would like to welcome everyone to the INVISTA Holdings Corporation's third quarter 2022 earnings results 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 that time, press star 1. on your telephone keypad. If you would like to withdraw your question, please press star, then the number two on your telephone keypad. I would now like to turn the call over to Mr. Stephen Keller, Vice President of Investor Relations of Investa Holdings. Mr. Keller, you may begin your conference call.

Thank you, and good afternoon. With us today are Amir Agday, our President and Chief Executive Officer, and Howard Yu, our Chief Financial Officer. I want to point out that our earnings release, the slide presentation supplementing today's call, and the reconciliations and other information required by SEC Regulation G relating to any non-GAAP financial measures provided during a call are all available on the Investors section of our website, www.investico.com. The audio portion of this call will be archived on the Investors section of our website later today under the heading Events and Presentations. It will remain archived until our next quarterly call. As announced on January 3rd, 2022, we have closed the divestiture of our CAVO treatment units and instruments business for the first three quarters of 2022 and the full year of 2021. The results of this business are reflected as discontinued operations in our financial statements as required by generally accepted accounting principles. All references in these remarks and accompanying presentation to earnings, revenues, other company-specific financial metrics relate only to the continuing operations of Invista's business except for cash flow measures. During the presentation, we will describe some of the more significant factors that impacted year-over-year performance. The supplemental materials describe additional factors that impacted year-over-year performance. Unless otherwise noted, references in these remarks to company-specific financial metrics relate to the third quarter of 2022, and references to period-to-period increases or decreases in financial metrics are year-over-year. During a call, we may also describe certain products and devices that have applications submitted and pending certain regulatory approvals or available only in certain markets. Further, we will be making forward looking statements within the meaning of the federal securities laws, including statements regarding events or developments that we believe anticipate or may occur in the future. These forward looking statements are subject to a number of risks and uncertainties, including those set forth in our SEC filings and actual results might differ materially from any forward-looking statements that we make today. These forward-looking statements speak only as of the date that they are made, and we do not assume any obligation to update any forward-looking statements except where as required by law. With that, I'd like to turn the call over to Amir.

Thank you, Stephen. Good afternoon, and welcome to INVISTA's third quarter 2022 earnings call. Today, we are pleased to announce that despite a challenging macro environment, the INVISTA team has once again delivered a strong quarter with mid-single-digit core growth and over 20% adjusted EBITDA margins. Our culture circles around customer centricity, innovation, respect, continuous improvement and leadership, coupled with the Invista business system, EBS, is what drives our performance and allows us to deliver on our long-term objectives of accelerating growth, expanding operating margins, and transforming our portfolio. Our strategic differentiation and proven track record of execution gives us confidence that we can continue to deliver a balance of accelerating growth and expanding margins. Before I turn it over to Howard to discuss third quarter results in more detail, I want to take this opportunity to reiterate our long-term vision and provide some insight on current market conditions, and offer a quick update on the progress towards our strategic priorities. I will also provide a brief update on how we are embedding sustainable environmental, social, and governance ESG principles into our strategy. At Invista, our focus is to partner with dental professionals to improve quality of life by digitizing, personalizing, and democratizing oral care. We continue to engage with our customers to learn, educate, and lead the dental community. On September 7th, we hosted over 1,200 dental professionals in Vienna, Austria at the Sold Out and Vista Summit. This European event was a great opportunity to articulate our vision for the future of the dentistry while highlighting the combined strength and scale of the INVISTA portfolio. We provided high-impact training in orthodontics, implantology, and digital workflows, and introduced clinicians to the latest advancement in dental care that will transform dentistry over the coming decade. The feedback from the event was very positive and highlighted the long-term opportunities in the dental market the importance of our unique and individualized solutions, the desire for premium training and education, and the opportunity for investors to lead and shape the future of dentistry. While private and group practices and DSOs remain excited about the promising outlook for dental, there is no doubt that the impact of inflation and potential for an economic slowdown coupled with the various geopolitical risks around the world, including the conflict in Ukraine, continues to weigh heavy on clinicians' minds. While patient traffic remains robust and is scheduled for specialty procedures, including implants, remain full, doctors are more cautious and thoughtful about their investments. Having said that, both private Group practices and DSOs continue to invest in expanding their specialty treatments and are looking for ways to enhance their capabilities, improve their workflows, and digitize their offices. They see opportunities to improve the efficiency and predictability of their treatments. While we expect there to be some continued uncertainty in the market over the short term, we remain confident the dental market is resilient and has ample room for continuous improvement and growth over the long term. Turning to our Q3 progress, our orthodontic business continues to deliver strong results. SPARC delivered greater than 100% year-over-year revenue growth while also driving double-digit quarter-over-quarter growth in the number of active SPARC doctors. We recently announced the launch of SPARC Clear Aligners Release 13, which features differentiated integrated hooks, the CBCT TrueRoot feature, and real-time approval in the SPARC-approved software. All innovation aimed at further enhancing treatment planning while continuing to build a sustainable competitive advantage for SPARC. In addition to SPAR, our traditional bracket and wire business is also growing and outgrowing the market, delivering mid single digit growth globally. We continue to gain traction with our new Damon Ultima system that provides orthodontists more control for faster and more precise finishing. Our solution for implant-based tooth replacements grew mid single digits in the quarter as we continue to improve our commercial execution and accelerate sales of our premium implants and regenerative solutions. We remain focused on delivering margin expansion while investing in our long-term growth initiatives. In Q3 2020, we achieved an adjusted EBITDA margin of 20.2%. This represents a 60 basis point of a margin improvement versus Q3 2021. In the quarter, we delivered 40 basis point of adjusted growth margin improvements driven by productivity improvements and 160 basis point of a net pricing offset by meaningful inflation. We also took steps to strengthen our supply chain and add more flexibility across our businesses. In the spread of continuous improvement, we focus on streamlining our organization to both protect and expand margins while speeding up decision making. As we move forward throughout the balance of the year and into 2023, we will intensify efforts to further optimize our organizational structure to improve the customer experience while creating more flexibility to deal with uncertainties in the macro environment. The transformation of our portfolio continues as we emphasize our most differentiated solutions by making additional investments to our fast-growing specialty businesses and continue to add to our digital capabilities. In our traditional imaging business, we have made the strategic decision to focus on key geographies where we have a sustainable competitive advantage. This allows us to reduce structure costs while further optimizing our portfolio, leading to both accelerating growth and improving margins over the long term. In the third quarter, we took steps to set this business up for lasting growth. We have now fully rebranded the interaural scanner to DEXIS IS and are expanding our customer reach and optimizing our global distribution. The DEXIS portfolio offers a full range of interaural scanners that are coupled with a powerful and intuitive software solution that enables accurate digital impressions, improved scanning procedures and speeds, and flexible workflows. While the DEX is a scanner software and configured as an open and a standalone system, they also now work closely with our DTX Studio Clinic software, providing clinicians the opportunity to bring all x-ray images, photos, 2D, 3D, and extra-aural and intra-aural imaging formats into one clear, comprehensive view, thus simplifying their diagnostics, workflows, and increasing confidence in interaction with patients. DTX Studio Clinic includes assisted intelligence features like Smart Fusion, which automatically aligns the digital surface models from the DEXYS interaural scanner with any CBCT scan and is a unique and powerful tool for efficient implant planning. We're honored that DEXYS DTX Studio Software Suite which includes DTX Studio Clinic, has been awarded the Celerent Best of Class Technology Award for the second consecutive year. Selected by a distinguished panel of dental technology experts, Celerent Award winners are recognized for groundbreaking technology that expands possibilities for the world of dentistry. In addition to our focus on digital workflows, we continue to expand our capabilities in implant-based tooth replacements. As previously announced, we closed the acquisition of Ostergenics Biomedical, a US-based manufacturer of regenerative solution in early Q3. Bone regenerative therapies are increasingly an important part of an implant-based tooth replacement procedure. By providing clinicians with the best-in-class solutions, we can better support them and delivering the best possible patient care while also capturing more value from each implant procedure. This business is off to a strong start within Envista. We are excited about its ability to create lasting value for patients, clinicians, and our shareholders. As we make progress in our journey to digitize, personalize, and democratize dental care, It's important to also keep sustainability initiatives top of mind. To that end, I'm proud of our recently released sustainability report. This report continues and outlines our progress in embedding environmental, social, and governance principles in our strategic approach. While we are still relatively new as an independent company, we have made solid progress in quantifying our environmental footprint, addressing climate-related risks and opportunities, and fostering a diverse and inclusive workplace for our employees. Some of our progress includes achieving 99% gender and ethnic equity in the United States. ensuring an efficient and stable supply chain through proactive supplier management that reflects our values and supports business continuity. Incorporating the task force and climate-related financial disclosures recommendation, identifying relevant climate-related risks and opportunities and integrating oversight into our existing enterprise risk management processes, analyzing eight environmental metrics, including scope one and two greenhouse gas emissions, water consumption, and waste generation. By investing in our ability to operate sustainably, we intend to secure the success of our communities, employees, customers, and shareholders. We're building upon the ESC initiatives that we had undertaken as a new, newly public company. I'm pleased with our achievements today and I look forward to further progress in our journey to partner with dental professionals to digitize, personalize, and democratize dental care. I will now turn the call over to Howard to go through our third quarter financials and provide more details on our segment performance. Thanks, Amir.