Envista Holdings Corporation · NYSE:NVST
Envista — Q3 2024 Earnings Presentation
27 slides from Envista's earnings presentation, Oct 30, 2024
Slide 1: Third Quarter 2024 – Earnings Presentation
Envista Third Quarter 2024 – Earnings Presentation October 30, 2024
Slide 2: Q3 2024 | Today's Speakers
Q3 2024 | Today’s Speakers Paul Keel Eric Hammes Chief Executive Officer Chief Financial Officer 2
Slide 3: Forward Looking Statements
Forward Looking Statements Certain statements included or incorporated by reference in this presentation are “forward-looking statements” within the meaning of the U.S. federal securities laws. All statements other than historical factual information are forward-looking statements, including without
Slide 4: Agenda
• Opening Thoughts Paul Keel • Financial Results – Q3 2024 Eric Hammes Agenda • FY24 Guidance and Closing Remarks Paul Keel • Q&A 4
Slide 5: Key Takeaways
Key Takeaways Q3 performance as expected; Reconfirming FY 2024 guidance • Q3 results as expected o Q3 reported results: -5.3% core growth1, 9.1% adjusted EBITDA margin1 o Impact from Spark revenue deferral change larger in Q3 than Q2 (no impact to underlying cash flows) o Q3 underlying performance c
Slide 6: Q3 2024 | Dental Market and Envista Performance
Q3 2024 | Dental Market and Envista Performance % of Envista Est. Market Envista Segment Commentary Sales1 Growth2 Performance Implants + We narrowed gap vs market in NA, across both Technologies Premium and Value ~40% LSD+ Flat Products & Specialty + Single tooth procedures remain resilient ‒ Full
Slide 7: Q3 2024 | Financial Metrics
Q3 2024 | Financial Metrics Q3 Q3 Summary Key Metric1 vPY 2024 2023 • Core Sales growth -5.3% Revenue $601.0M $631.3M -$30.3M o Spark net revenue deferral impact larger in Q3 than Q2 o Positive growth in Spark (ex-deferral) Core Sales Growth(%) -5.3% 0.8% -610 bps o Impact from realignment of NA cha
Slide 8: Q3 2024 | Revenue Bridge (vPY)
Q3 2024 | Revenue Bridge (vPY)1 Growth Rate % +$3M Reported Revenue -4.8% +$10M Core Growth2 % -5.3% $631M -$27M -$12M -$4M $601M Q3 Price FX Spark Dealer Inventory Other Q3 2023 Deferral Realingment Volume 2024 8 1 Bridge based on management's best estimate of year over year impact. 2 Core sales gr
Slide 9: Q3 2024 | Adjusted EBITDA Bridge (vPY)
Q3 2024 | Adjusted EBITDA Bridge (vPY)1 0.7% 19.6% 0.8% $19.5 -4.9% -1.6% -1.4% -4.1% 9.1% Q3 Net Net Price / Spark Deferral & Mix Investments Other items Q3 2023 Productivity Volume Dealer Inventory 2024 Realignment 9 1 Adjusted EBITDA & adjusted EBITDA margin are non-GAAP financial measures. For a
Slide 10: Q3 2024 | Specialty Products & Technologies
Q3 2024 | Specialty Products & Technologies Continuing to Invest for Long-term Growth & Profitability Revenue Adjusted Operating • Orthodontics continues to gain share Core Sales1 -5.2% Profit Margin1 o Number of active Spark Doctors grew DD $399.5 $381.7 o Spark sales down significantly inclusive o
Slide 11: Q3 2024 | Equipment & Consumables
Q3 2024 | Equipment & Consumables Gained share in soft Diagnostics market; Consumables sell-out in line with market Revenue Adjusted Operating • Diagnostics declined MSD Core Sales1 -5.6% Profit Margin1 o Diagnostics market remains soft $231.8 $219.3 o Modest growth in NA offset by declines outside
Slide 12: Q3 2024 | Cash Flow and Balance Sheet
Q3 2024 | Cash Flow and Balance Sheet Strong Balance Sheet; Free Cash Flow +45% YTD Q3 Q3 • Free Cash Flow 2024 2023 o $63M free cash flow in Q3 Operating Cash Flow $70.7M $95.5 M o $179M YTD, up 45% year-over-year o Strong net working capital management and disciplined capital expenditures Capital
Slide 13: 2024 | Full Year Guidance
2024 | Full Year Guidance Reconfirming FY24 guidance; Expect to return to growth in Q4 Guidance Key Metric1 2024 Revenue – Core Growth -1% to -4% Adj. EBITDA Margin 10% to 12% Note: These forward-looking estimates do not reflect future gains and charges that are inherently difficult to predict and e
Slide 14: Closing Thoughts
Closing Thoughts Market still soft but stable Q3 results as expected: -5.3% core growth, 9.1% adjusted EBITDA; underlying performance consistent with Q2 Reconfirming FY24 guidance, expect to return to growth in Q4 Continued progress positioning Envista for improving performance 14
Slide 15: Q&A
Q&A Paul Keel Eric Hammes Chief Executive Officer Chief Financial Officer 15
Slide 16: Appendix
Appendix 16
Slide 17: Reconciliation of Adjusted Gross Profit
Envista Holdings | Reconciliation of Adjusted Gross Profit ($ in millions) Adjusted Gross Profit and Adjusted Gross Margin Three Months Ended Nine Months Ended ($ in Millions) September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023 Gross Profit $ 317.3 $ 363.3 $ 1,000.2 $ 1,104.6
Slide 18: Reconciliation of Adjusted Operating Profit
Envista Holdings | Reconciliation of Adjusted Operating Profit ($ in millions) Adjusted Operating Profit Three Months Ended Nine Months Ended ($ in millions) September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023 Consolidated Operating Profit (Loss) $ 20.9 $ 83.3 $ (1,084.3) $ 2
Slide 19: Reconciliation of Adjusted Net Income
Envista Holdings | Reconciliation of Adjusted Net Income($ in millions) Adjusted Net Income ($ in millions) Three Months Ended Nine Months Ended September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023 Net Income (Loss) $ 8.2 $ 21.5 $ (1,119.8) $ 117.2 Amortization of acquisition-
Slide 20: Reconciliation of Adjusted Diluted EPS
Envista Holdings | Reconciliation of Adjusted Diluted EPS Adjusted Diluted Earnings Per Share Three Months Ended Nine Months Ended September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023 Diluted Earnings (Loss) $ 0.05 $ 0.12 $ (6.51) $ 0.66 Amortization of acquisition-related and
Slide 21: Reconciliation of Adjusted Diluted Shares Outstanding
Reconciliation of Adjusted Diluted Shares Envista Holdings | Outstanding (in Millions) Adjusted Diluted Shares Outstanding Three Months Ended Nine Months Ended (in millions) September 27, September 29, September 27, 2024 September 29, 2023 2024 2023 Average common stock shares outstanding - basic 17
Slide 22: Reconciliation of Adjusted EBITDA
Envista Holdings | Reconciliation of Adjusted EBITDA ($ in millions) Adjusted EBITDA Three Months Ended Nine Months Ended ($ in millions) September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023 Net Income (Loss) $ 8.2 $ 21.5 $ (1,119.8) $ 117.2 Interest expense, net 11.9 15.4 36.
Slide 23: Reconciliation of Core Sales Growth
Envista Holdings | Reconciliation of Core Sales Growth1 Core Sales Growth 1 % Change Three Month Period % Change Nine Month Period Ended September 27, 2024 vs. Ended September 27, 2024 vs. Consolidated Comparable 2023 Period Comparable 2023 Period Total sales growth (4.8) % (3.3) % Plus the impact o
Slide 24: Reconciliation of Operating Cash Flows to Free Cash Flow
Reconciliation of Operating Cash Flows to Free Envista Holdings | Cash Flow ($ in Millions) Reconciliation of Operating Cash Flows to Free Cash Flow ($ in millions) Three Months Ended Nine Months Ended September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023 Net Operating Cash Pro
Slide 25: Notes to Reconciliation of GAAP to Non-GAAP Financial Measures
Envista Holdings | Non-GAAP Financial Measures Notes to reconciliation of GAAP to non-GAAP financial measures (unaudited) A Represents impairment charge related to goodwill and certain intangible assets. B We exclude impairment of certain long-lived assets, executive transition costs, and cost incur
Slide 26: Statement Regarding Non-GAAP Measures
Envista Holdings | Non-GAAP Financial Measures Statement Regarding Non-GAAP Measures Each of the non-GAAP measures set forth above should be considered in addition to, and not as a replacement for or superior to, the comparable GAAP measure, and may not be comparable to similarly titled measures rep
Slide 27: Statement Regarding Non-GAAP Measures (Continued)
Envista Holdings | Non-GAAP Financial Measures Statement Regarding Non-GAAP Measures (Continued) The items excluded from the non-GAAP measures set forth above have been excluded for the following reasons: • With respect to Adjusted Gross Profit, Adjusted Operating Profit, Adjusted Net Income, Adjust