Integra LifeSciences Holdings Corporation · NASDAQ:IART
Integra LifeSciences — Q1 2017 Earnings Presentation
18 slides from Integra LifeSciences's earnings presentation, Apr 26, 2017
Slide 1: First Quarter 2017 Earnings Call Presentation
First Quarter 2017 Earnings Call Presentation April 26, 2017 1
Slide 2: Forward-Looking Statements / Safe Harbor
Forward-Looking Statements / Safe Harbor This presentation contains “forward-looking statements”, including statements regarding the proposed Codman Neurosurgery and the ability to consummate the proposed transaction. Statements in this document may contain, in addition to historical information, ce
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures In addition to our GAAP results, we provide organic revenues, adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA"), adjusted net income, adjusted EPS, free cash flow and adjusted free cash flow conversion. Organic revenues consist of total re
Slide 4: First Quarter Accomplishments
First Quarter Accomplishments DERMA SCIENCES CODMAN NEURO • Total company organic revenue growth of 6.4% • Adjusted gross margin over 70.0% • Operating cash flow growth increased 15% and adjusted free cash flow conversion of 85.1% (TTM) • Derma Sciences commercial integration on track for mid-year c
Slide 5: Specialty Surgical Solutions Revenue
Specialty Surgical Solutions Revenue First Quarter 2017 **All Commentary in Constant Currency** $156.3M; +3.4% Reported • Dural Repair sales increased high single digits • Precision Tools & Instruments increased mid single digits $ in millions driven by MAYFIELD®2 As reported Int’l: $44.3; +3.7% • T
Slide 6: Orthopedics & Tissue Technologies Revenue
Orthopedics & Tissue Technologies Revenue First Quarter 2017 **All Commentary in Constant Currency** $102.3M; +19.6% Reported • Regenerative Technologies sales grew double digits, excluding Int’l: Derma Sciences $ in millions $13.2; As reported +3.4% • Derma commercial integration on track for mid-y
Slide 7: Components of 2017 Revenue Guidance
Components of 2017 Revenue Guidance Full Year 2017 $1,150 Derma Sciences $1.12B-$1.14B • Derma expected to contribute ~$70 million $1,100 Discontinued Organic • Foreign currency expected to have a Products/FX negative impact of ~1% $1,050 $992M • Discontinued products represent a ($ millions) $1,000
Slide 8: First Quarter 2017 Results and 2017 Guidance
First Quarter 2017 Results and 2017 Guidance Feb 2017 Apr 2017 % of revenue Q1 2017 Q1 2016 Change Guidance Guidance Gross Margin 66.5% 64.2% +230BPS 65% - 66% No Change Adj. Gross Margin* 70.2% 69.2% +100BPS 69% - 70% No Change R&D 6.0% 6.1% -10BPS ~6% No Change SG&A 55.1% 47.3% +780BPS 51% - 52% N
Slide 9: Cash Flow and Other Measures: First Quarter and 2017 Guidance
Cash Flow and Other Measures: First Quarter and 2017 Guidance Feb 2017 Apr 2017 ($ millions) Q1 2017 Q1 2016 Change Guidance Guidance Operating Cash Flow $28.9 $25.0 15.4% $115 - $145 No Change CapEx $9.2 $10.9 (15.6%) ~$50 - $55 No Change Free Cash Flow* $19.7 $14.1 39.7% $65 - $90 No Change FCF Co
Slide 10: Capital Structure
Capital Structure Current Capitalization Credit Statistics ($ in millions) 3/31/2017 Bank Leverage Ratio* 2.8x Cash and Equivalents $ 124 Max Leverage Ratio 4.5x Current Revolver Capacity@ $ 645 Revolver ($1,000) $ 355 Term Loan@ $ 500 Pro Forma Leverage with Codman Neurosurgery Total Debt (face val
Slide 11: Key Focus Areas for 2017 and Beyond
Key Focus Areas for 2017 and Beyond Execute on our 2017 financial targets Focus on integration of Derma Sciences and closing of Codman Neurosurgery Increase regenerative technology commercial investments and new product launches • Build upon 3 x 3 wound care strategy • Enhance market access and heal
Slide 12: Appendix
Appendix Non-GAAP Reconciliations 12
Slide 13: First Quarter 2017 Organic Growth Reconciliation
First Quarter 2017 Organic Growth Reconciliation (In thousands) Q1 2017 Q1 2016 Specialty Surgical Solutions $156,290 $151,175 Domestic 111,948 108,402 International 44,342 42,773 Orthopedics and Tissue Technologies $102,346 $85,595 Domestic 89,148 72,830 International 13,198 12,765 Total Revenue $2
Slide 14: First Quarter 2017 & 2016 Adjusted EBITDA Margin Reconciliation
First Quarter 2017 & 2016 Adjusted EBITDA Margin Reconciliation (In thousands) Q1 2017 Q1 2016 GAAP net income $6,394 $13,419 Depreciation and intangible asset amortization expense 19,717 18,253 Other (income) expense, net 90 738 Interest (income) expense, net 5,124 6,367 Income tax expense (benefit
Slide 15: First Quarter 2017 and 2016 Adjusted EPS Reconciliation
First Quarter 2017 and 2016 Adjusted EPS Reconciliation (In thousands) Q1 2017 Q1 2016 GAAP net income $6,394 $13,419 Global ERP implementation charges 2,427 3,324 Structural optimization charges 1,586 1,709 Certain employee severance charges 125 650 Acquisition-related charges 20,317 6,041 Disconti
Slide 16: First Quarter 2017 and 2016 (TTM) Free Cash Flow Conversion Reconciliation
First Quarter 2017 and 2016 (TTM) Free Cash Flow Conversion Reconciliation (In thousands) TTM 2017 TTM 2016 GAAP Net cash provided by operating activities*^ $163,040 $112,792 Purchases of Property and Equipment (45,624) (38,978) Free Cash Flow $117,416 $73,814 Adjusted net income $137,990 $112,921 A
Slide 17: First Quarter 2017 Gross Margin Reconciliation
First Quarter 2017 Gross Margin Reconciliation (In thousands) Q1 2017 Q1 2016 Reported Gross Profit $172,051 $151,997 Structural optimization charges 898 985 Certain employee severance charges - 211 Acquisition-related charges 643 3,652 Discontinued product lines charges 1,025 - Intangible asset amo
Slide 18: First Quarter 2017 Adjusted SG&A Reconciliation
First Quarter 2017 Adjusted SG&A Reconciliation (In thousands) Q1 2017 Q1 2016 Reported SG&A $142,497 $111,975 Global ERP implementation charges 2,427 3,324 Structural optimization charges 688 724 Certain employee severance charges 125 439 Acquisition-related charges 19,674 2,389 Adjusted SG&A $119,
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