Bausch + Lomb Corporation

Greetings. Welcome to the Bausch & Lomb Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, George Gutkowski. Sartre, the floor is yours.

Thank you. Good morning, everyone, and welcome to our second quarter 2023 financial results conference call. Participating on today's call are Chairman and Chief Executive Officer, Mr. Brent Saunders, and Chief Financial Officer, Mr. Sam Eldosuki. In addition to this live webcast, a copy of today's slide presentation and a replay of this conference call will be available on our website under the investor relations section. Before we begin, I would like to remind you that our presentation today contains forward-looking information. We would ask that you take a moment to read the forward-looking legend at the beginning of our presentation as it contains important information. This presentation contains non-GAAP financial measures and ratios. For more information about these measures and ratios, please refer to slide one of the presentation. Non-GAAP reconciliations can be found in the appendix to the presentation posted on our website. The financial guidance in this presentation is effective as of today only. It is our policy to generally not update guidance until the following quarter unless required by law and not to update or affirm guidance other than through broadly disseminated public disclosure. With that, it's my pleasure to turn the call over to Brent.

Thank you, George, and thank you, everyone, for joining us today. My remarks will focus on two themes that define the quarter, performance and progress. Let's jump right in on slide three. Since our last update, I spent significant time on the road hearing directly from customers. No matter the country, no matter the specialty, one theme was consistent. People are rooting for us and want to see Bausch & Lomb as an industry leader once again. Two areas for improvement were also made clear and speak directly to challenges we covered during our call last quarter. First, we need to bring a steady supply of new products to market. Second, we need to ensure customers have access to a consistent supply of products across our entire portfolio, which means upgrading our global supply chain. Here's the good news. We know what needs fixing. As I've said before, we have a large global infrastructure and an expansive commercial footprint. We offer products that address all eye care needs. There are approximately 13,000 Bausch & Lomb employees motivated every day by our mission of helping people see better to live better. But scale is a competitive advantage only when it's efficient. Think of our challenge like a restaurant with great food and service, loyal clientele, and an ideal location. But it fails to get food orders right and on time. The question is, how do you streamline the dining experience without losing any of what customers love? Let's take a look at our progress. Last quarter, I unveiled the roadmap to accelerate growth, our multi-year plan to realize Bausch & Lomb's full potential. We're early in the process, but I am encouraged by what we've been able to accomplish in just a few months. Highlights include flattening the organization to free up resources and focus on new capabilities we're building, including next generation digital and data competencies. We launched an employee-driven initiative aimed at reducing inefficiencies and administrative burden with a focus on our sales team. We put quick wins on the board in several areas, including expense reporting, meeting protocols, and IT support in the field. I also solidified our leadership team, bringing in new talent and creating new roles aligned to our strategy. Complex change projects like our roadmap tend to ask a lot of employees. but we have a talented and motivated team that gets it. They understand what needs to be fixed and want to be part of the solution. And amidst all this change, they delivered a very solid quarter. 12% revenue growth on a constant currency basis, outperformance across all segments, and increasing demand in key markets would make any CEO happy, especially in my first full quarter. And to be perfectly clear, I am proud of our performance and encouraged by several trends that will influence future growth. But my focus is on what's holding us back. To put it simply, we need to improve how we make and deliver our products to customers and consumers. I'll use our Lynchburg, Virginia Contact Lines Distribution Center as an example. We were forced to upgrade that facility given significant growth in the business, a good problem to have. I'll spare you the details, but essentially we needed to move from a 30-year-old manual system to a new digitized way of working. The problem is we didn't execute, and technical issues led to the facility quickly falling behind in processing orders. We expect to have things sorted out by the end of the year. Thanks to the tireless efforts of our Lynchburg employees, we did experience a self-imposed negative financial impact to our business. What happened in Lynchburg is the most prominent supply chain issue we faced in the last quarter, but certainly not the only one. While some things may be outside of our control, we need to eliminate self-inflected negative impacts to our business. Despite the ongoing supply challenges, I'm very pleased with our second quarter, which Sam will go deeper on.