Teleflex Incorporated · NYSE:TFX
Teleflex — Raymond James Life Sciences & MedTech Conference 2019
46 slides from Teleflex's conference presentation, Jun 19, 2019
Slide 1: Teleflex Investor Presentation
Teleflex Investor Presentation June 2019 1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation and our discussion contain forward-looking information and statements, which inherently involve risks and uncertainties that could cause actual results to differ from those projected or implied in the forward–looking statements. These statements involve k
Slide 3: Making a Difference
Making a Difference Teleflex products are used everyday: 31,000 1,600 In 31,000 surgical procedures To help more than 1,600 patients who in the United States require vascular access intervention globally 6,000 3,200 To care for more than 6,000 By emergency responders to treat patients globally in th
Slide 4: Demographics and Industry Trends in Our Favor
Demographics and Industry Trends in Our Favor 10,000People turn 65 in the U.S. everyday1 Lower acuity patients moving to lower cost 1.1B People 50+ sites of service in Asia by 20252 1. Pew Research Center: http://www.pewresearch.org/fact-tank/2010/12/29/baby-boomers-retire/ 4 2. APACMed: http://www.
Slide 5: Teleflex Investment Thesis
Teleflex Investment Thesis Global • Leading positions in growing markets (vascular, interventional access, interventional urology) Leadership • Established and respected global brands • Global scale to succeed in today’s healthcare marketplace Unique Size • More nimble than larger device companies •
Slide 6: Segment Revenue Review
Segment Revenue Review Total Constant Dollars Q1’19 Q1’18 Currency Sales Currency in Millions Revenue Revenue Impact Growth Growth Americas $344.0 $323.3 6.4% (0.3%) 6.7% EMEA $154.6 $159.9 (3.3%) (7.8%) 4.5% Asia $60.8 $58.2 4.3% (6.7%) 11.0% OEM $54.2 $45.8 18.3% (1.8%) 20.1% TOTAL $613.6 $587.2 4
Slide 7: Global Product Category Revenue Review
Global Product Category Revenue Review Total Constant Dollars Q1’19 Q1’18 Currency Sales Currency in Millions Revenue Revenue Impact Growth Growth Vascular Access $143.9 $144.0 (0.1%) (2.6%) 2.5% Interventional $103.2 $90.1 14.5% (2.6%) 17.1% Anesthesia $80.3 $84.9 (5.5%) (4.0%) (1.5%) Surgical $86.
Slide 8: Organic Constant Currency Revenue Growth
Organic Constant Currency Revenue Growth 5.1% (in millions) ~4.0% 1 $2,448 Organic, constant currency revenue $2,350 average 2015 - 2017 growth in 2018 $2,146 $2,150 $1,950 $1,868 $1,840 $1,810 $1,750 $1,696 $1,551 $1,550 $1,493 $1,350 $1,150 $950 $750 2011 2012 2013 2014 2015 2016 2017 2018 8 Bar c
Slide 9: Track Record of Adjusted Gross and Operating Margin Expansion
Track Record of Adjusted Gross and Operating Margin Expansion Adjusted Gross Margin Adjusted Operating Margin +130 bps +60 bps +170 bps 57.1% +100 bps 25.7% 57.1 55.8% +140 bps 25.1% +260 bps 55.8% 54.1% +120 bps 24.1% +150 bps 54.1% 52.7% 21.5% 52.7% 51.5% 20.0% 51.5% 2014 2015 2016 2017 2018 2014
Slide 10: Core Strategic Building Blocks
Core Strategic Building Blocks Teleflex is a Differentiated Med Tech Asset Drive Constant Deliver Non-Revenue Continue to be a Align Portfolio Continue to Attract Currency Dependent Margin Serial Acquirer with Favorable Key Talent Revenue Growth Expansion Demographics • Address major • Execute restr
Slide 11: Teleflex 2021: 3 Year Growth Drivers
Teleflex 2021: 3 Year Growth Drivers High growth company with gross and operating margin expansion Execute Leverage strategic global M&A Drive infrastructure Medium Continued utilization Invest in cadence in growth growth key disease of new product company states product categories with gross and la
Slide 12: Invest in Key Disease States and Markets
Invest in Key Disease States and Markets Catheter complications Drive utilization Interventional procedures Drive utilization/ grow market share Percutaneous laparoscopy Grow market share Anesthesia and emergency medicine Drive utilization Men’s health Drive utilization 12
Slide 13: Drive Utilization in Growth Product Categories
Drive Utilization in Growth Product Categories Current Portfolio Interventional Vascular Airway Urology Intraosseous Access Access Management Interventional Cardiology The UroLift® EZ-IO® OnControl® Rüsch® Polaris™ Fiber Turnpike® TrapLiner® Chocolate® System Intraosseous Vascular Powered PICCS Opti
Slide 14: Leverage Global Infrastructure
Leverage Global Infrastructure Strategies • Realize margin expansion through ongoing restructuring initiatives • Leverage recent go-directs to strengthen control of commercial channels in Europe and Asia • Drive adoption of high margin products in new markets ORANGE: Americas BLUE: Europe, Middle Ea
Slide 15: Execute Disciplined M&A Strategy
Execute Disciplined M&A Strategy Acquisition Criteria M&A Focus • Fits existing business units and call points 1 Scale • Provides superior clinical benefit to existing alternatives • Provides cost-benefit to the hospital 2 Dealer to direct • Strong IP and patent protection • Long product life cycles
Slide 16: Track Record of Value Creating Acquisitions
Track Record of Value Creating Acquisitions Mini-Lap Truphatek Ace Medical Nostix, LLC CarTika Vascular QT Vascular Technologies, Holdings US, LLC Medical, Inc. Solutions, Inc. Inc. Limited Mayo 2014 2015 2015 2015 2016 2017 2018 Healthcare Pty. Ltd. 2014 ‘13 ‘14 ‘15 ‘16 ‘17 ‘18 Vidacare Human Medic
Slide 17: Key Investment Highlights
Key Investment Highlights Diversified, global medical technology company Well-positioned to take advantage of favorable industry dynamics Leading market positions with established global brands Diversified customer and supplier base Strong cash flow generation and proven history of deleveraging and
Slide 18: Thank You
18 Veleflex:
Slide 19: Appendix A: Key Products
19 Appendix A: Key Products 19
Slide 20: NeoTract: A Compelling Growth Asset
NeoTract: A Compelling Growth Asset Significant Market • Initial target market 8.5M U.S. BPH drug or drug drop out patients; Opportunity >$30B total addressable market • 2 randomized controlled trials; 7 single arm studies Exceptional • 29 peer-reviewed publications Clinical Data • 5 year follow-up
Slide 21: Very Large Clinical Need and Market Opportunity
Very Large Clinical Need and Market Opportunity 0.3 Surgery Drug drop out 1.5 8.5 Million Men on drugs or drug drop out UroLift® System target market Drugs 7.0 $30B TAM Watchful waiting 3.2 12.0 Million U.S. men treated for BPH1 #Men (millions) 21 1. NeoTract internal market estimates for 2016
Slide 22: Simple, Straightforward Procedure
Simple, Straightforward Procedure Nitinol Capsular Tab Apply Lidocaine Gently push Relieve obstruction PET Suture jelly/oral sedative^ tissue aside Typically same Insert delivery system Deploy customized implants day discharge Stainless Steel Urethral End Piece (4-6 Avg) 22 ^ This does not account f
Slide 23: UroLift 2
UroLift 2 One implant per cartridge UroLift Implant design remains the same 23 The UroLift 2 is not approved for sale of distribution
Slide 24: Reducing Tradeoffs Between Effectiveness and Risk Compared to Drugs
Reducing Tradeoffs Between Effectiveness and Risk Compared to Drugs Time to First Evidence of Symptom Improvement Incidence of Sexual Dysfunction^5,7 Statistically Significant at 10-16 Months5,6,7 Relief (Weeks)1,2,3,4,5 Mean AUASI Reduction Ejaculatory Dysfunction Erectile Dysfunction 12- 10.8 0%-
Slide 25: Anesthesia and Emergency Medicine: Arrow EZ-IO Intraosseous Vascular Access Device
Anesthesia and Emergency Medicine: Arrow® EZ-IO® Intraosseous Vascular Access Device Top Market Trends • >137 million visits to the emergency room in the U.S. annually1 • There are >500,000 adult occurrences of cardiac arrest yearly in the US with an estimated 10% survival rate2 • Sepsis kills a pat
Slide 26: Anesthesia/Emergency Medicine: RePlas FreezeDried Plasma
Anesthesia/Emergency Medicine: RePlas® FreezeDried Plasma RePlas® FreezeDried Plasma Top Market Trends • >137 million visits to the emergency room in the U.S. annually1 • Minimal plasma availability in challenging environments (e.g. prehospital, remote/rural, battlefield settings), despite demand an
Slide 27: RePlas FreezeDried Plasma Market
RePlas® FreezeDried Plasma Market Market Size Estimate Government ~$20M - Total market size $25M Civilian* $ ~$100M ~$70M - $75M Source: Management estimates 27 *Does not include civilian trauma hospitals
Slide 28: Interventional Procedures
Interventional Procedures Top Market Trends TrapLiner® Catheter • Coronary artery disease is the most common type of heart disease in the US – cause of more than 370,000 deaths annually1 • Over 1 million percutaneous coronary interventions (PCI) are performed in the US every year2 • Approximately 8.
Slide 29: ARROW OnControl Powered Bone Access System
ARROW® OnControl® Powered Bone Access System Powered bone marrow biopsy device vs. ~$160M manual biopsy devices: • Consistently larger, high quality core specimens1-4 On-Control® Total Potential • Demonstrated less patient insertion pain2 and Addressable U.S. Market1 significantly less post-procedur
Slide 30: OnControl System Significant Utilization Opportunity
OnControl® System Significant Utilization Opportunity OnControl® System North America Utilization per Account Strategies to Drive Utilization: • Invest in professional education 20+ kits/month 11% Leaders and cadaver training 10-18 kits/month 14% Regulars • Leverage larger interventional sales chann
Slide 31: Arrow AC3 Optimus Intra-Aortic Balloon Pump
Arrow® AC3 Optimus® Intra-Aortic Balloon Pump Advanced IABP performance even in the most critical conditions • With the onset of an elevated heart rate or arrhythmia, the patient’s survival can suddenly depend on the ability of the IABP to keep pace with the situation • The AC3 Optimus® intra-aortic
Slide 32: Turnpike Catheters
Turnpike® Catheters Turnpike® Spiral Catheter Distal nylon coil provides rotational assistance for enhanced trackability Turnpike® Gold Catheter Gold-plated, threaded metallic tip for enhanced advancement Turnpike® LP Catheter Low-profile version with greater tip and distal shaft flexibility for adv
Slide 33: TrapLiner Catheter
TrapLiner® Catheter Guide Extension Plus Wire Trapping • Balloon inflates to maintain Balloon inflates via a guidewire position hypotube push rod to trap, the guidewire against the • Rapid exchange guide interior wall of the guide extension for backup catheter support and deep-seating • Gold radiopa
Slide 34: Percutaneous Laparoscopy
Percutaneous Laparoscopy Percutaneous Access Devices Top Market Trends • 3.5 million laparoscopic procedures performed in the US Annually1 • Patient and clinician demand for decreased trauma and enhanced safety • Patient satisfaction influence on reimbursement • Shifts to outcome based medicine Grow
Slide 35: Creating a Suite of Minimally Invasive Surgical Products
Creating a Suite of Minimally Invasive Surgical Products Weck® Hem-o-lok® Polymer Ligation Systems Pilling® Laparoscopic Instruments Weck Vista® Bladeless Laparoscopic Access Ports 35
Slide 36: Weck Hem-o-lok Polymer Ligation Systems
Weck® Hem-o-lok® Polymer Ligation Systems Product Description Weck Hem-o-lok® polymer ligation clips are designed for cool ligation, lasting security and fast, efficient delivery – secure from the cartridge to the applier and on the vessel. The Weck Hem-o-lok polymer ligation system unique design of
Slide 37: Catheter Complications: Antimicrobial Technology
Catheter Complications: Antimicrobial Technology Top Market Trends • Pressures on healthcare funding linked to patient outcomes • Increasing awareness of infection and thrombosis Protected Catheters driving penalties and therapy costs • Increasing awareness of CLABSI issues with PICC lines Growth St
Slide 38: Arrowg+ard Blue Advance PICC
Arrowg+ard Blue Advance™ PICC Product Description Pressure-injectable Arrowg+ard Blue Advance™ PICCs with Chlorag+ard® Technology are the world’s first PICCs in the intravascular catheter marketplace with both broad-spectrum antimicrobial and antithrombogenic protection. Extra- and intraluminal prot
Slide 39: Appendix B: GAAP to Non-GAAP Reconciliations
39 Appendix B: GAAP to Non-GAAP Reconciliations 39
Slide 40: Note on Non-GAAP Financial Measures
Note on Non-GAAP Financial Measures The presentation to which these appendices are attached and the following appendices include, among other things, tables reconciling the following applicable non-GAAP financial measures to the most comparable GAAP financial measure: • Constant currency revenue gro
Slide 41: Non-GAAP Adjustments
Non-GAAP Adjustments The following is an explanation of certain of the adjustments that are applied with respect to one or more of the non-GAAP financial measures that appear in the presentation to which these appendices are attached: Restructuring, restructuring related and impairment items. Restru
Slide 42: Appendix A – Reconciliation of Constant Currency and Organic Constant Currency Revenue Growth
Appendix A – Reconciliation of Constant Currency and Organic Constant Currency Revenue Growth Dollars in Millions Twelve Months Ended Revenue Twelve Months Ended Growth 2015 2016 2017 2018 2015 2016 2017 2018 Prior Year Ended Dec 31 Revenue As Reported $ 1,839.8 $ 1,809.7 $ 1,868.0 $ 2,146.3 Foreign
Slide 43: Appendix B – Reconciliation of Adjusted Gross Profit and Margin
Appendix B – Reconciliation of Adjusted Gross Profit and Margin Dollars in Thousands Twelve Months Ended December 31, 2014 December 31, 2015 December 31, 2016 December 31, 2017 December 31, 2018 Gross profit as-reported $ 942,428 $ 944,403 $ 996,200 $ 1,171,802 $ 1,384,442 Gross margin as-reported 5
Slide 44: Appendix C – Reconciliation of Adjusted Operating Profit and Margin
Appendix C – Reconciliation of Adjusted Operating Profit and Margin Dollars in Thousands Tw elve Months Ended Decem ber 31, 2014 Decem ber 31, 2015 Decem ber 31, 2016 Decem ber 31, 2017 Decem ber 31, 2018 Incom e from continuing operations before interest, loss on extinguishm ent of debt and taxes $
Slide 45: Appendix D – Reconciliation of Adjusted Earnings per Share
Appendix D – Reconciliation of Adjusted Earnings per Share Twelve Months Ended December 31, 2015 December 31, 2016 December 31, 2017 December 31, 2018 2015 - 2018 CAGR GAAP diluted earnings per share available to common shareholders $ 4.91 $ 4.98 $3.33 $4.20 (5.1%) GAAP year-over-year growth 19.8% 1
Slide 46: Appendix E Tickmarks
Appendix E Tickmarks (A) Restructuring, restructuring related and impairment items - In 2015 the majority of these charges were related to facility consolidations. In 2016, these charges include; (i) charges related to facility consolidations, (ii) a pre-tax, non-cash $41.0 million impairment charge
Teleflex — Raymond James Life Sciences & MedTech Conference 2019 on 6ix