Slide 1: Teleflex Incorporated Third Quarter 2004 Earnings Conference Call
Teleflex Incorporated Third Quarter 2004 Earnings Conference Call
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation and our discussion contain forward-looking information and statements on such matters as business strategies, market potential, future financial performance, product deployments and other matters which inherently involve risks and uncertainties which could
Slide 3: Jeff Black, President and Chief Executive Officer
Jeff Black, President and Chief Executive Officer
Slide 4: Third Quarter Summary
Third Quarter Summary Core growth = 3% Strong cash flow performance Positive economic indicators: orders up 29% this quarter Core order growth 18%
Slide 5: Third Quarter Challenges
Third Quarter Challenges Tier I Automotive business within Commercial Segment Pedal Systems Alternative Fuel Systems Industrial Gas Turbine in Aerospace Segment $17 million operating loss between these "problem businesses" Includes restructuring and one-time costs of $3.3 million in these businesses
Slide 6: Outlook
Outlook 2004 EPS = $2.64 to $2.74 Outlook does not include gains, losses or costs associated with the termination of operations, further restructuring programs or divestitures. Guidance adjusted to reflect tax benefit of 5 cents recognized in third quarter.
Slide 7: Third Quarter Highlights - Aerospace Segment
Third Quarter Highlights - Aerospace Segment Strongest operating results this year Orders up over 70% - second consecutive quarter of growth Cargo systems, military and commercial aviation 3Q03 3Q04 TFX 131.965 125.785 3Q03 3Q04 TFX 469 3519
Slide 8: Third Quarter Highlights - Medical Segment
Third Quarter Highlights - Medical Segment Record operating results Hudson acquisition performing in line with expectations, integration ahead of plan Non-cash inventory revaluation expense of $3.2 million related to Hudson acquisition 3Q03 3Q04 TFX 139.644 204.824 3Q03 3Q04 TFX 20.992 30.465
Slide 9: Third Quarter Highlights - Commercial Segment
Third Quarter Highlights - Commercial Segment Marine businesses characterized by strong revenue growth and margin expansion Operating results negatively impacted by Tier I automotive business issues 3Q03 3Q04 TFX 279.241 295.153 3Q03 3Q04 TFX 15.815 7.896
Slide 10: Action Plan
Action Plan Focus on reduced cost and improved productivity Portfolio evaluation process - review product lines to phase-out, divest, maintain, or grow Several modest divestitures completed to date 2Q '04 - Three product lines in Commercial Segment 3Q '04 - Two product lines in automotive and indust
Slide 11: Martin Headley, Executive Vice President and Chief Financial Officer
Martin Headley Executive Vice President and Chief Financial Officer
Slide 12: Cash Flow
Cash Flow Operating cash flow up 29% over 3Q 2003 Free cash flow up 82% over 3Q 2003
Slide 13: Balance Sheet
Balance Sheet Modest leverage despite spending $458 million for HudsonRCI acquisition this quarter
Slide 14: Growth
Growth Excluding phase out of some IGT services, core growth was 5%
Slide 15: Operating Margin
Operating Margin IGT construction/engineering phase-out helps operating margin Tier I auto drag on 2004 operating margin Corporate expense up $2.2M - SOX compliance and other initiatives Portfolio pruning, streamlined facilities, consolidation of ops to drive improved margin going forward
Slide 16: Segment Review
Segment Review Medical: Strong core growth rate of 5% Solid margin: 16.4% (note: excluding $3.2 million purchase accounting impacts from HudsonRCI) Aerospace: Core growth of 3-4%, excluding phase-out of IGT construction and engineering services 70% increase in orders over 3Q03; second consecutive qu
Slide 17: Q&A Session
Q&A Session Veleflex