Slide 1: Third Quarter 2018 Earnings Conference Call
Teleflex Incorporated Third Quarter 2018 Earnings Conference Call 1
Slide 2: Conference Call Logistics
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 8158978 2
Slide 3: Today's Speakers
Today’s Speakers Liam Kelly President and CEO Thomas Powell Executive Vice President and CFO Jake Elguicze Treasurer and Vice President, Investor Relations 3
Slide 4: Note on Forward-Looking Statements and Non-GAAP Financial Measures
Note on Forward-Looking Statements This presentation and our discussion contain forward-looking information and statements including, but not limited to, forecasted 2018 GAAP, constant currency and organic constant currency revenue growth, GAAP and adjusted gross and operating margins, GAAP and adju
Slide 5: 3Q18 Highlights
3Q18 Highlights Revenue Highlights • As-reported revenue increased 14.0% versus 3Q17 • Constant currency revenue increased 15.0% versus 3Q17 • 3Q18 organic constant currency revenue growth better than expected due to strong business unit execution and return of distributor orders in North America •
Slide 6: 3Q18 Constant Currency Revenue Growth
3Q18 Constant Currency Revenue Growth Q3 2018 Constant Currency Revenue Growth Volume (excluding surgical product line exit) 3.5% New Product Introductions 1.6% Price 0.7% Surgical Product Line Exit (0.2%) M&A NeoTract 9.2% Other M&A 0.2% Constant Currency Revenue Growth 15.0% 6 Note: See appendices
Slide 7: Segment Revenue Review
Segment Revenue Review Total Constant Dollars Q3’18 Q3’17 Currency Sales Currency in Millions Revenue Revenue Impact Growth Growth Vascular NA $80.7 $75.1 7.5% (0.3%) 7.8% Interventional NA $66.7 $60.7 9.9% 0.0% 9.9% Anesthesia NA $53.2 $50.8 4.6% (0.2%) 4.8% Surgical NA $42.5 $40.8 4.3% (0.3%) 4.6%
Slide 8: Product and Clinical Updates: UroLift System
Product and Clinical Updates UroLift® System Clinical Publications at World Congress of Endourology 2018 Annual Conference KEY TAKEAWAYS • The “Real world Experience” study of 156 patients in U.K. demonstrated International Prostate Symptom Score (IPSS) improvement as well as improved quality of lif
Slide 9: Product and Clinical Updates: RePlas FDP1 Trial
Product and Clinical Updates RePlas® “FDP1” Phase 1 Safety Trial Abstract Presented at AABB 2018 KEY TAKEAWAYS Re-Plas® Freeze-Dried Plasma • Phase 1 study to determine the safety of autologous infusions of whole blood (CPD) derived freeze dried plasma (FDP) or plasmapheresis (ACD) derived FDP into
Slide 10: Acquisition Updates
Acquisition Updates Acquisition of Essential Medical; October 4th, 2018 The MANTA Vascular Closure Device KEY TAKEAWAYS • The MANTA Vascular Closure Device is a unique system specifically designed for closure of large bore arteriotomies utilizing devices or sheaths ranging from 10 French to 18 Frenc
Slide 11: Product Categories Driving Durable Organic Revenue Growth
Product Categories Driving Durable Organic Revenue Growth Current Portfolio Interventional Vascular Airway Urology Intraosseous Access Access Management Interventional Cardiology The UroLift® EZ-IO® OnControl® Rüsch® Polaris™ Fiber Turnpike® TrapLiner® Chocolate® Intraosseous Vascular Powered PICCS
Slide 12: 3Q18 Financial Review
3Q18 Financial Review Revenue of $609.7 million • Up 14.0% vs. prior year period on an as-reported basis • Up 15.0% vs. prior year period on a constant currency basis Gross Margin • GAAP gross margin of 56.2%, up 100 bps vs. prior year period • Adjusted gross margin of 57.0%, up 130 bps vs. prior ye
Slide 13: 2018 Financial Outlook
2018 Financial Outlook 2018 Revenue Guidance • Lowered as-reported revenue growth guidance from a range of between 14% and 15% to a range of between 13.5% and 14.5% • Reaffirmed constant currency revenue growth guidance range of between 12% and 13% • Reaffirmed organic constant currency revenue grow
Slide 14: Question and Answer Section
Question and Answer Section 14
Slide 15: Thank You
THANK YOU 15 Veleflex:
Slide 16: Appendices
Appendices Veleflex:
Slide 17: Non-GAAP Financial Measures
Non-GAAP Financial Measures The presentation to which these appendices are attached and 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 e
Slide 18: Appendix A – Reconciliation of Constant Currency Revenue Growth
Appendix A – Reconciliation of Constant Currency Revenue Growth Dollars in Millions Three Months Ended % Increase / (Decrease) Total Currency Constant Currency September 30, 2018 October 1, 2017 Revenue Growth Impact Revenue Growth Vascular North America $ 80.7 $ 75.1 7.5% (0.3%) 7.8% Interventional
Slide 19: Appendix B – Reconciliation of Constant Currency Revenue Growth
Appendix B – Reconciliation of Constant Currency Revenue Growth Dollars in Millions Nine Months Ended % Increase / (Decrease) Total Currency Constant Currency September 30, 2018 October 1, 2017 Revenue Growth Impact Revenue Growth Vascular North America $ 243.8 $ 232.9 4.7% 0.1% 4.6% Interventional
Slide 20: Appendix C – Revenue Growth
Appendix C – Revenue Growth Dollars in Millions Year-Over-Year Growth % Basis Points Three Months Ended October 1, 2017 Revenue As-Reported $ 534.7 Foreign currency $ (4.7) -1.0% -100 Volume (excluding Surgical product line exit) $ 18.7 3.5% 350 Surgical product line exit $ (1.2) -0.2% -20 New produ
Slide 21: Appendix D – Revenue Growth
Appendix D – Revenue Growth Dollars in Millions Year-Over-Year Growth % Basis Points Nine Months Ended October 1, 2017 Revenue As-Reported $ 1,551.2 Foreign currency $ 33.8 2.5% 250 Volume (excluding Surgical product line exit and the impact of shipping days) $ 31.1 2.1% 210 Shipping day impact $ (1
Slide 22: Appendix E – Reconciliation of Adjusted Gross Profit and Margin
Appendix E – Reconciliation of Adjusted Gross Profit and Margin Dollars in Thousands Three Months Ended September 30, 2018 October 1, 2017 Teleflex gross profit as-reported $ 342,573 $ 295,227 Teleflex gross margin as-reported 56.2% 55.2% Restructuring, restructuring related and impairment items (A)
Slide 23: Appendix F – Reconciliation of Adjusted Gross Profit and Margin
Appendix F – Reconciliation of Adjusted Gross Profit and Margin Dollars in Thousands Nine Months Ended September 30, 2018 October 1, 2017 Teleflex gross profit as-reported $ 1,018,621 $ 841,071 Teleflex gross margin as-reported 56.4% 54.2% Restructuring, restructuring related and impairment items (A
Slide 24: Appendix G – Reconciliation of Adjusted Operating Profit and Margin
Appendix G – Reconciliation of Adjusted Operating Profit and Margin Dollars in Thousands Three Months Ended Septem ber 30, 2018 October 1, 2017 Teleflex incom e from continuing operations before interest, loss on extinguishm ent of debt and taxes $ 82,105 $ 110,354 Teleflex incom e from continuing o
Slide 25: Appendix H – Reconciliation of Adjusted Operating Profit and Margin
Appendix H – Reconciliation of Adjusted Operating Profit and Margin Dollars in Thousands Nine Months Ended Septem ber 30, 2018 October 1, 2017 Teleflex incom e from continuing operations before interest, loss on extinguishm ent of debt and taxes $ 202,438 $ 281,375 Teleflex incom e from continuing o
Slide 26: Appendix I – Reconciliation of Adjusted EPS
Appendix I – Reconciliation of Adjusted EPS from Continuing Operations Three Months Ended– September 30, 2018 Dollars in Millions, except per share data Selling, general Restructuring Net income (loss) Diluted earnings Shares used in Cost of Research and and and Interest Income attributable to commo
Slide 27: Appendix J – Reconciliation of Adjusted EPS
Appendix J – Reconciliation of Adjusted EPS from Continuing Operations Three Months Ended – October 1, 2017 Dollars in Millions, except per share data Selling, general Restructuring Net incom e (loss) Diluted earnings Shares used in Cost of Research and and and Interest Incom e attributable to com m
Slide 28: Appendices I and J – tickmarks
Appendices I and J – tickmarks (A) Restructuring, restructuring related and impairment items - Restructuring programs involve discrete initiatives designed to, among other things, consolidate or relocate manufacturing, administrative and other facilities, outsource distribution operations, improve o
Slide 29: Appendix K – Reconciliation of Adjusted EPS
Appendix K – Reconciliation of Adjusted EPS from Continuing Operations Nine Months Ended – September 30, 2018 Dollars in Millions, except per share data Selling, general Restructuring Net incom e (loss) Diluted earnings Shares used in Cost of Research and Loss on and and Interest Incom e attributabl
Slide 30: Appendix L – Reconciliation of Adjusted EPS
Appendix L – Reconciliation of Adjusted EPS from Continuing Operations Nine Months Ended – October 1, 2017 Dollars in Millions, except per share data Selling, general Restructuring Net incom e (loss) Diluted earnings Shares used in Cost of Research and Loss on and and Interest Incom e attributable t
Slide 31: Appendices K and L – tickmarks
Appendices K and L – tickmarks (A) Restructuring, restructuring related and impairment items - Restructuring programs involve discrete initiatives designed to, among other things, consolidate or relocate manufacturing, administrative and other facilities, outsource distribution operations, improve o
Slide 32: Appendix M – Reconciliation of Adjusted Tax Rate
Appendix M – Reconciliation of Adjusted Tax Rate Dollars in Thousands Three Months Ended September 30, 2018 Incom e from Taxes on continuing incom e from operations continuing before taxes operations Tax rate (A) Other items - These are discrete items that occur sporadically and can affect period-to
Slide 33: Appendix N – Reconciliation of Adjusted Tax Rate
Appendix N – Reconciliation of Adjusted Tax Rate Dollars in Thousands Nine Months Ended September 30, 2018 Incom e from Taxes on continuing incom e from operations continuing before taxes operations Tax rate (A) Other items - These are discrete items that occur sporadically and can affect period-to-
Slide 34: Appendix O – 2018 Constant Currency and Organic Revenue Growth Guidance
Appendix O – Reconciliation of 2018 Constant Currency and Organic Constant Currency Revenue Growth Guidance 2018 Guidance Low High Forecasted GAAP Revenue Growth 13.50% 14.50% Forecasted impact of foreign currency exchange rate fluctuations 1.50% 1.50% Forecasted Constant Currency Revenue Growth 12.
Slide 35: Appendix P – 2018 Adjusted Gross Margin Guidance
Appendix P – Reconciliation of 2018 Adjusted Gross Margin Guidance 2018 Guidance Low High Forecasted GAAP Gross Margin 56.35% 56.75% Estimated restructuring, restructuring related and impairment items (A) 0.60% 0.55% Estimated acquisition, integration and divestiture related items (B) 0.05% 0.00% Es
Slide 36: Appendix Q – 2018 Adjusted Operating Margin Guidance
Appendix Q – Reconciliation of 2018 Adjusted Operating Margin Guidance 2018 Guidance Low High Forecasted GAAP Operating Margin 12.95% 13.45% Estimated restructuring, restructuring related and impairment items (A) 3.85% 3.80% Estimated acquisition, integration and divestiture related items (B) 2.75%
Slide 37: Appendix R – 2018 Adjusted Earnings Per Share Guidance
Appendix R – Reconciliation of 2018 Adjusted Earnings Per Share Guidance 2018 Guidance Low High Forecasted GAAP Diluted Earnings Per Share $4.00 $4.10 Estimated Restructuring, restructuring related and impairment items (A) $1.75 $1.76 Estimated Acquisition, integration and divestiture related items
Slide 38: Appendix S – 2018 Financial Outlook Assumptions
Appendix S – 2018 Financial Outlook Assumptions Euro to U.S. Dollar exchange rate assumed to be approximately 1.18 for full year 2018 Adjusted weighted average shares expected to be approximately 46.9 million for full year 2018 2018 Calendar of shipping days: Q1’18 vs. Q1’17: 1 less day Q2’18 vs. Q2
Slide 39: Appendix T – Teleflex Restructuring Plan Summary
Appendix T – Teleflex Restructuring Plan Summary In addition to the 2018 Footprint realignment plan, we have ongoing restructuring programs related to (i) the integration of Vascular Solutions into Teleflex; (ii) the centralization of certain administrative functions in our EMEA segment; (iii) the c
Slide 40: U – GPO and IDN Review
Appendix U – GPO and IDN Review Group Purchasing Organization Update • 11 renewed agreements • 0 new agreements • 0 existing agreements lost IDN Update • 8 renewed agreements • 2 new agreements • 0 existing agreements lost 40