Slide 1: Teleflex Incorporated First Quarter 2016 Earnings Conference Call
1 Teleflex Incorporated First Quarter 2016 Earnings Conference Call
Slide 2: Conference Call Logistics
2 Conference Call Logistics The release, accompanying slides, and replay webcast are available online at www.teleflex.com (click on “Investors”) Telephone replay available by dialing 855-859-2056 or for international calls, 404- 537-3406, pass code number 90662973
Slide 3: Introductions
3 Introductions Benson Smith Chairman and CEO Liam Kelly President and COO Thomas Powell Executive Vice President and CFO Jake Elguicze Treasurer and Vice President of Investor Relations
Slide 4: Forward-Looking Statements
4 Forward-Looking Statements This presentation and our discussion contain forward-looking information and statements including, but not limited to, forecasted 2016 GAAP and constant currency revenue growth; forecasted 2016 GAAP and adjusted gross and operating margins; forecasted 2016 GAAP and adjus
Slide 5: Executive Summary
5 Executive Summary First quarter 2016 revenue of $424.9 million • Down 1.1% vs. prior year period on an as-reported basis • Up 1.1% vs. prior year period on a constant currency basis First quarter 2016 adjusted EPS of $1.52, up 16.9% vs. prior year period Reaffirmed 2016 guidance range for constant
Slide 6: First Quarter Highlights
6 First Quarter Highlights First quarter 2016 constant currency revenue growth of 1.1% • Sales volume of new products contribute 1.1% of constant currency growth • Acquisitions and distributor conversions contribute 0.7% of constant currency revenue growth • Core product pricing increases contribute
Slide 7: Segment Revenue Review
7 Segment Revenue Review Q1’16 Q1’15 Constant Currency Revenue Commentary Vascular N.A.: $81.5 million, up 1.5% Anesthesia N.A.: $46.0 million, up 1.6% Surgical N.A.: $38.9 million, up 3.1% EMEA: $122.1 million, down 1.9% Asia: $49.2 million, up 6.4% OEM: $34.0 million, down 1.6% All Other: $53.2 mi
Slide 8: Group Purchasing Organization and IDN Review
8 Group Purchasing Organization and IDN Review Track record of expansion of contractual agreements continues in Q1’16 Group Purchasing Organization Update • 4 new agreements • 8 renewed agreements IDN Update • 8 new agreements • 12 renewed agreements • 1 existing agreement not renewed
Slide 9: First Quarter Financial Review
9 First Quarter Financial Review Revenue of $424.9 million • Down 1.1% vs. prior year period on an as-reported basis • Up 1.1% vs. prior year period on a constant currency basis Adjusted gross margin of 53.6%, up 130bps vs. prior year period Adjusted operating margin of 22.4%, up 190 bps vs. prior y
Slide 10: Subsequent Events
10 Subsequent Events Privately Negotiated Convertible Note Transactions • On April 4, 2016, pursuant to separate, privately negotiated transactions, the Company paid cash and common stock to the certain holders of its convertible notes in exchange for $219.2 million aggregate principal amount of the
Slide 11: 2016 Financial Outlook Assumptions
11 2016 Financial Outlook Assumptions Reaffirming previously provided full year 2016 Revenue Guidance • Constant currency revenue growth expected to be between 5.0% and 6.0% • As-reported revenue growth expected to be between 3.0% and 4.0% Reaffirming previously provided full year 2016 Adjusted Gros
Slide 12: Any Questions?
12 Any Questions?
Slide 13: Thank You
13 Thank You
Slide 14: Appendices
14 Appendices
Slide 15: Non-GAAP Financial Measures
15 Non-GAAP Financial Measures The following appendices include, among other things, tables reconciling the following non-GAAP financial measures to the most comparable GAAP financial measure: • Constant currency revenue growth. This measure excludes the impact of translating the results of internat
Slide 16: Appendix A: Constant Currency Revenue Growth
16 APPENDIX A – RECONCILIATION OF CONSTANT CURRENCY REVENUE GROWTH DOLLARS IN MILLIONS March 27, 2016 March 29, 2015 Constant Currency Currency Total Vascular North America 81.5$ 80.8$ 1.5% (0.5%) 1.0% Anesthesia North America 46.0 45.4 1.6% (0.5%) 1.1% Surgical North America 38.9 38.1 3.1% (0.8%) 2
Slide 17: Appendix B: Revenue Growth
17 APPENDIX B – RECONCILIATION OF REVENUE GROWTH DOLLARS IN MILLIONS 1: amount is comprised of incremental price on existing products and the sale of new products of $1.3 million and $1.5 million, respectively, both of which are a result of the businesses acquired and distributor to direct conversio
Slide 18: Appendix C: Adjusted Gross Profit and Margin
18 APPENDIX C – RECONCILIATION OF ADJUSTED GROSS PROFIT AND MARGIN DOLLARS IN THOUSANDS March 27, 2016 March 29, 2015 Teleflex gross profit as-reported 225,147$ 222,637$ Teleflex gross margin as-reported 53.0% 51.8% Losses and other charges, net (A) 2,651 2,124 Adjusted Teleflex gross profit 227,798
Slide 19: Appendix D: Adjusted Operating Profit and Margin
19 APPENDIX D – RECONCILIATION OF ADJUSTED OPERATING PROFIT AND MARGIN DOLLARS IN THOUSANDS (A) In 2016 losses and other charges, net related primarily to facility consolidations and the gain on sale of an asset. In 2015, losses and other charges, net related primarily to facility consolidations. Ma
Slide 20: Appendix E: Adjusted EPS from Continuing Operations Q1 2016
20 APPENDIX E – RECONCILIATION OF ADJUSTED EPS FROM CONTINUING OPERATIONS QUARTER ENDED – MARCH 27, 2016 DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA Cost of goods sold Selling, general and administrative expenses Research and development expenses Restructuring and other impairment charges (Gain) loss
Slide 21: Appendix F: Adjusted EPS from Continuing Operations Q1 2015
21 APPENDIX F – RECONCILIATION OF ADJUSTED EPS FROM CONTINUING OPERATIONS QUARTER ENDED – MARCH 29, 2015 DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA Cost of goods sold Selling, general and administrative expenses Restructuring and other impairment charges Interest expense, net Income taxes Net income
Slide 22: Appendix G: Adjusted Tax Rate
22 APPENDIX G – RECONCILIATION OF ADJUSTED TAX RATE DOLLARS IN THOUSANDS Three Months Ended March 27, 2016 Income from continuing operations before taxes Taxes on income from continuing operations Tax rate GAAP basis $53,793 $2,613 4.9% Restructuring and impairment charges 9,968 2,337 Losses and oth
Slide 23: Appendix H: 2016 Constant Currency Revenue Growth Guidance
23 APPENDIX H – RECONCILIATION OF 2016 CONSTANT CURRENCY REVENUE GROWTH GUIDANCE Low High Forecasted GAAP Revenue Growth 3.0% 4.0% Estimated Impact of Foreign Currency Fluctuations 2.0% 2.0% Forecasted Constant Currency Revenue Growth 5.0% 6.0%
Slide 24: Appendix I: 2016 Adjusted Gross Margin Guidance
24 APPENDIX I – RECONCILIATION OF 2016 ADJUSTED GROSS MARGIN GUIDANCE Note: In 2016, estimated losses and other charges, net relate primarily to facility consolidation expenses. Low High Forecasted GAAP Gross Margin 53.15% 54.05% Estimated losses and other charges, net 0.85% 0.95% Forecasted Adjuste
Slide 25: Appendix J: 2016 Adjusted Operating Margin Guidance
25 APPENDIX J – RECONCILIATION OF 2016 ADJUSTED OPERATING MARGIN GUIDANCE Note: In 2016, estimated losses and other charges, net relate primarily to facility consolidation expenses. Low High Forecasted GAAP Operating Margin 19.3% 19.6% Estimated losses and other charges, net 1.0% 1.1% Estimated inta
Slide 26: Appendix K: 2016 Adjusted Earnings Per Share Guidance
26 APPENDIX K – RECONCILIATION OF 2016 ADJUSTED EARNINGS PER SHARE GUIDANCE Low High Forecasted diluted earnings per share attributable to common shareholders $5.32 $5.37 Restructuring, impairment charges and special items, net of tax $0.80 $0.85 Intangible amortization expense, net of tax $0.90 $0.