Embecta Corp (EMBC) 2024 Q4 法說會逐字稿

Good day, and welcome to the Embecta fourth quarter of fiscal year 2024 earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded.

大家好，歡迎參加 Embecta 2024 財年第四季財報電話會議。（操作員指示）請注意，今天的會議正在錄製中。

I would now like to hand the conference over to your speaker, Mr. Pravesh Khandelwal, Vice President of Investor Relations. Please go ahead.

現在我想將會議交給您的發言人、投資者關係副總裁 Pravesh Khandelwal 先生。請繼續。

Thank you, operator. Good morning, everyone, and welcome to Embecta's fiscal fourth-quarter and full-year 2024 earnings conference call.

謝謝你，接線生。大家早安，歡迎參加 Embecta 的第四財季和 2024 年全年財報電話會議。

The press release and slides to accompany today's call and webcast replay details are available on the Investor Relations section of the company's website at www.embecta.com. With me today are Dev Kurdikar, Embecta's President and Chief Executive Officer; and Jake Elguicze, our Chief Financial Officer.

今天電話會議的新聞稿和幻燈片以及網路廣播重播的詳細資訊可在公司網站 www.embecta.com 的投資者關係部分取得。今天和我在一起的有 Embecta 總裁兼執行長 Dev Kurdikar；和我們的財務長 Jake Elguicze。

Before we begin, I would like to remind you that some of the matters discussed in the conference call will contain forward-looking statements regarding future events as outlined in our slides. We wish to caution you that such statements are, in fact, forward-looking in nature and are subject to risks and uncertainties, and actual events or results may differ materially. The factors that could cause actual results or events to differ materially include, but are not limited to, factors referenced in our press release today as well as our filings with the SEC, which can be accessed on our website.

在我們開始之前，我想提醒您，電話會議中討論的一些事項將包含有關幻燈片中概述的未來事件的前瞻性陳述。我們希望提醒您，此類陳述實際上具有前瞻性，並存在風險和不確定性，實際事件或結果可能存在重大差異。可能導致實際結果或事件出現重大差異的因素包括但不限於我們今天的新聞稿中提到的因素以及我們向 SEC 提交的文件（可以在我們的網站上存取）。

In addition, we will discuss certain non-GAAP financial measures on this call, which should be considered a supplement to and not a substitute for financial measures prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to the comparable GAAP measures is included in our press release and conference call presentation.

此外，我們將在本次電話會議上討論某些非公認會計原則財務措施，這些措施應被視為根據公認會計原則準備的財務措施的補充，而不是替代。我們的新聞稿和電話會議簡報中包含了這些非公認會計準則衡量標準與可比較公認會計準則衡量標準的調整。

Our agenda for today's call is as follows. Dev will start by presenting an overview of our strategic priorities following the spin-off and will highlight key accomplishments to date. He will also share insights into our future strategy and provide details of the restructuring plan announced today. Jake will then review our financial results for the fourth quarter and full fiscal year 2024 as well as discuss the preliminary guidance for fiscal 2025. Following these updates, we will open the call for questions.

我們今天的電話會議議程如下。開發人員將首先概述分拆後我們的策略重點，並將重點介紹迄今為止的主要成就。他還將分享對我們未來策略的見解，並提供今天宣布的重組計劃的詳細資訊。隨後，傑克將回顧我們第四季和 2024 財年的財務業績，並討論 2025 財年的初步指導。在這些更新之後，我們將開始提問。

With that said, I would now like to turn the call over to our CEO, Dev Kurdikar.

話雖如此，我現在想將電話轉給我們的執行長 Dev Kurdikar。

Good morning, and thank you for taking the time to join us. Since the spin, which occurred on April 1, 2022, our strategic priorities over the past 2.5 years have been focused on three areas. These included the need to strengthen and optimize our core business, the requirement to separate and stand up the organization from our former parent and to invest in growth opportunities. I'm pleased to report that during the past 2.5 years, we made significant progress within each of these objectives.

早安，感謝您抽出寶貴時間加入我們。自 2022 年 4 月 1 日發生剝離以來，我們過去 2.5 年的策略重點一直集中在三個領域。其中包括需要加強和優化我們的核心業務，需要將組織從我們的前母公司中分離出來並獨立出來，以及投資成長機會。我很高興地向大家報告，在過去 2.5 年裡，我們在每個目標方面都取得了重大進展。

First, we strengthened our core business by securing exclusive and dual-preferred contracts with key Medicare part D plans as well as establishing our products as a top choice within the national formularies, among other accomplishments. Second, we successfully completed major stand-up programs, including the implementation of our own ERP, shared services and distribution network, covering approximately 98% of our revenue base, with only India remaining. We also executed a complex program to transfer the legal entity ownership of our manufacturing facility in China. I'm proud to say that we completed these activities and more while avoiding interruptions to our customers, as well as avoiding disruptions to the people with diabetes who use our products daily.

首先，我們透過與主要醫療保險 D 部分計劃簽訂獨家和雙重優先合同，以及將我們的產品確立為國家處方集的首選等方式，加強了我們的核心業務。其次，我們成功完成了主要的站立項目，包括實施我們自己的 ERP、共享服務和分銷網絡，涵蓋了我們約 98% 的收入基礎，僅剩下印度。我們還執行了一項複雜的計劃，以轉讓我們在中國的製造工廠的法人實體所有權。我很自豪地說，我們完成了這些活動以及更多活動，同時避免了對客戶的干擾，也避免了對每天使用我們產品的糖尿病患者的干擾。

Finally, we continue to invest in growth. A testament to that is the clearance of our open loop patch pump, which occurred in Q4 as well as the launch of a small pack GLP-1 pen needle set in Germany with the intent to address the needs of a growing customer base. This strong execution, which occurred in a challenging macro environment, led to financial outcomes that exceeded 2024 expectations that were set prior to spin. This included delivering a constant currency compounded annual adjusted revenue growth rate of approximately 1.3% and an adjusted EBITDA margin of approximately 31.4%. This compared to initial pre-spin expectations which call for a flattish constant currency revenue CAGR, including significantly higher contract manufacturing revenue of non-diabetes products for BD and an adjusted EBITDA margin of approximately 30%.

最後，我們繼續投資於成長。我們的開環貼片幫浦於第四季度獲得批准，以及在德國推出的小包裝 GLP-1 筆針套裝就是證明，旨在滿足不斷增長的客戶群的需求。這種強有力的執行力是在充滿挑戰的宏觀環境中發生的，導致財務表現超出了分拆前設定的 2024 年預期。這包括實現約 1.3% 的固定匯率複合年調整收入成長率和約 31.4% 的調整後 EBITDA 利潤率。這與最初的分拆前預期相比，該預期要求穩定的貨幣收入複合年增長率，包括 BD 非糖尿病產品的合約製造收入顯著提高，調整後的 EBITDA 利潤率約為 30%。

As a reminder, we have provided these initial expectations in March of 2022 in a vastly different economic climate unaware of the unprecedented challenges that would soon follow. Since that time, we navigated historic inflation, a rapidly rising interest rate environment, geopolitical conflicts and supply chain and labor issues. Despite these factors, which we estimate cost is roughly 500 basis points negative margin impact, our team delivered. Lastly, during this most recent quarter, we initiated a debt pay down plan. This multiyear commitment to reduce our debt obligation should position Embecta with greater financial flexibility as we move forward.

謹此提醒，我們在 2022 年 3 月的經濟環境截然不同的情況下提供了這些初步預期，但沒有意識到即將到來的前所未有的挑戰。從那時起，我們就應對了歷史性的通貨膨脹、快速上升的利率環境、地緣政治衝突以及供應鏈和勞工問題。儘管有這些因素，我們估計成本會對利潤率產生約 500 個基點的負面影響，但我們的團隊還是實現了目標。最後，在最近一個季度，我們啟動了一項債務償還計畫。這項減少債務的多年承諾將使 Embecta 在我們前進的過程中具有更大的財務靈活性。

Turning to slide 6, as we embark on the next phase of our journey, we recognize that building on our past accomplishments will require both prudent management of our capital structure and thoughtful investments to broaden our product portfolio to support future growth. Hence, this morning, we announced a restructuring plan aimed at streamlining operations and reducing costs. This restructuring program includes the decision to discontinue our insulin patch pump program. Following the recent US FDA clearance that we received on the open loop version of the pump that could be used by people with type 1 or type 2 diabetes, the decision to seize the pump program may come as a surprise.

轉向幻燈片6，當我們踏上旅程的下一階段時，我們認識到，在過去成就的基礎上，需要對我們的資本結構進行審慎管理，並進行深思熟慮的投資，以擴大我們的產品組合，以支持未來的成長。因此，今天早上，我們宣布了一項旨在精簡營運和降低成本的重組計劃。此重組計劃包括終止我們的胰島素貼片幫浦計劃的決定。最近，我們獲得美國 FDA 批准該泵的開環版本可供 1 型或 2 型糖尿病患者使用，之後我們決定取消該泵項目可能會令人驚訝。

However, it is important to understand that we did not intend to do a full market launch of this product as the open loop product currently cleared requires additional enhancements to be commercially competitive, including extensions of the products shelf life as well as enhancements in the form of making the device compatible from a bring-your-own device perspective. Most importantly, our goal since spin was to come to market with a closed-loop version of a platform that had a specific label designation for people with type 2 diabetes.

然而，重要的是要了解，我們並不打算將該產品全面推向市場，因為目前批准的開環產品需要額外的增強功能才能具有商業競爭力，包括延長產品的保質期以及形式的增強從自帶設備的角度使設備相容。最重要的是，自 spin 以來，我們的目標是向市場推出一個閉環版本的平台，該平台為 2 型糖尿病患者指定了特定的標籤。

While our product development team has executed this program extremely well, achieving all internal milestones to date, it would take several more years of significant investment for us to complete a clinical study, obtain FDA clearance and build up the necessary commercial and support functions before fully commercializing that product and achieving the scale for it to be accretive to our EBITDA.

雖然我們的產品開發團隊非常出色地執行了該計劃，實現了迄今為止的所有內部里程碑，但我們還需要幾年的大量投資才能完成臨床研究、獲得FDA 許可並在全面實施之前建立必要的商業和支援功能。

Additionally, we recognize the pump market has continued to evolve, and we anticipate that competition in closed-loop type 2 indicated products may continue to intensify and our offering would require incremental investments to be market competitive. I also want to point out that upon FDA clearance of our open loop pump, which we announced in September, we performed a market check to identify potential opportunities that would allow us to monetize the asset. Since that did not surface any viable options, we acted promptly to discontinue the program. The accompanying reorganization is designed to enhance the organization's profitability and cash flow, create a leaner and more efficient operation that would have greater financial flexibility to take advantage of opportunities that leverage our global commercial channel and strengthen high-volume manufacturing.

此外，我們認識到泵浦市場不斷發展，我們預期閉環 2 類指定產品的競爭可能會繼續加劇，我們的產品需要增量投資才能具有市場競爭力。我還想指出，在 FDA 批准我們的開環泵（我們於 9 月宣布）後，我們進行了市場檢查，以確定允許我們將資產貨幣化的潛在機會。由於沒有出現任何可行的選擇，我們立即採取行動終止了該計劃。隨之而來的重組旨在提高組織的獲利能力和現金流，創造更精簡、更有效率的運營，從而具有更大的財務靈活性，以利用我們的全球商業管道和加強大批量製造的機會。

In terms of financial impact, we currently anticipate that we will incur pretax cash charges associated with this reorganization of between $25 million and $30 million. Additionally, we anticipate that there will be non-cash charges associated with asset impairments and asset write-offs which we currently estimate to be in the range of between $10 million and $15 million on a pretax basis. We expect that this restructuring will be largely complete during the first half of fiscal year 2025 and will deliver annualized pretax cost savings of between $60 million and $65 million.

就財務影響而言，我們目前預計，與此重組相關的稅前現金費用將在 2,500 萬至 3,000 萬美元之間。此外，我們預計將產生與資產減損和資產沖銷相關的非現金費用，目前我們估計稅前金額在 1,000 萬美元至 1,500 萬美元之間。我們預計此次重組將在 2025 財年上半年基本完成，每年將節省 6,000 萬至 6,500 萬美元的稅前成本。

Lastly, given the recency of this decision, we have postponed our Analyst and Investor Day to the spring of 2025. This delay allows us to fully focus on executing this restructuring plan so that when we come together for our Analyst and Investor Day, we will be able to provide a fuller view of a more streamlined organization. In summary, we believe this strategic reorganization is a proactive step to improve our financial health, enhance profitability and strengthen the company for the years ahead.

最後，鑑於這項決定是近期做出的，我們已將分析師和投資者日推遲到 2025 年春季。這次延遲使我們能夠完全專注於執行該重組計劃，以便當我們齊聚分析師和投資者日時，我們將能夠更全面地了解更精簡的組織。總而言之，我們認為此次策略重組是改善我們財務狀況、提高獲利能力並在未來幾年增強公司實力的積極舉措。

Moving to slide 7, moving forward, our focus will be on the next phase of Embecta transformation, which will be guided by three key strategic priorities: continuing to strengthen the core business, expanding our product portfolio, and increasing financial flexibility. First, I would like to explain how we are planning to strengthen the core business further. In addition to continuing to deepen our relationships with customers and maintain our leading share of categories, we intend to progress the implementation of our brand transition plan and see growth opportunities. By advancing our brand transition plan, we are ensuring that Embecta's identity remains strong, clear and resonates across our markets.

轉到投影片 7，展望未來，我們的重點將是 Emecta 轉型的下一階段，該轉型將以三個關鍵策略優先事項為指導：繼續加強核心業務、擴大我們的產品組合和提高財務靈活性。首先，我想解釋一下我們計劃如何進一步加強核心業務。除了繼續深化與客戶的關係並保持領先的品類份額外，我們還打算推進品牌轉型計劃的實施，並看到成長機會。透過推進我們的品牌轉型計劃，我們確保 Embecta 的形像在我們的市場中保持強烈、清晰並引起共鳴。

We have been planning this transition since the spin-off and we intend for the execution of this program to begin in phases during fiscal year 2025. Notably, we are not changing the product names or color schemes associated with our packaging. This is important as people with diabetes will continue to experience the same look and feel of our boxes that they have been accustomed to for many years. The US will be the first region to undergo this transition, followed by Europe and then the other regions.

自從分拆以來，我們一直在計劃這項過渡，並打算在 2025 財年開始分階段執行該計劃。值得注意的是，我們不會更改與包裝相關的產品名稱或配色方案。這很重要，因為糖尿病患者將繼續體驗他們多年來習慣的盒子的相同外觀和感覺。美國將是第一個經歷這一轉變的地區，其次是歐洲，然後是其他地區。

We expect to be largely complete in the next couple of years, but successful execution will involve a carefully coordinated transition of packaging, labeling, registrations and regulatory certificates, among other things.

我們預計將在未來幾年內基本完成，但成功的執行將涉及包裝、標籤、註冊和監管證書等方面的仔細協調過渡。

As with the separation activities we were discussing a year ago, our continued standup and transition activities will involve temporary suspensions of our ability to manufacture and promote products in certain markets, which we intend to mitigate through inventory management and other measures that we successfully employed over the past year. Separately, we are actively pursuing other growth opportunities, identifying new areas to expand our reach and increase our impact. This includes both growing within our current markets and exploring untapped potential. One of the most promising opportunities on the horizon for Embecta is the growth for GLP-1 therapies. We believe that while GLP-1s may delay the progression to insulin independence, they do not eliminate the need for insulin.

就像我們一年前討論的分離活動一樣，我們持續的站立和過渡活動將涉及暫時中止我們在某些​​市場製造和推廣產品的能力，我們打算透過庫存管理和我們過去成功採用的其他措施來緩解這種情況。另外，我們正在積極尋求其他成長機會，尋找新的領域來擴大我們的影響力並提高我們的影響力。這包括在當前市場內發展和探索未開發的潛力。Emecta 最有前景的機會之一是 GLP-1 療法的成長。我們認為，雖然 GLP-1 可能會延遲胰島素依賴的進展，但它們並不能消除對胰島素的需求。

Furthermore, as GLP-1 administration methods continue to evolve from auto injectors to pen injectors, which require pen needles, we anticipate incremental benefit to our business. As noted on an earlier call, we recently launched our new small pack pen needle product in Germany specifically targeted for GLP-1 administration. This product introduction marks an important milestone, and we plan to expand this offering to additional markets in the future. We are confident that this will help address the growing demand for pen-based GLP-1 administration, meeting the needs of an increasing number of patients using pens and pen needles. We will share more of our thoughts on the broader GLP-1 market opportunity, and how we intend to benefit in the coming years at our Investor Day in the spring.

此外，隨著 GLP-1 給藥方法不斷從自動注射器發展到需要筆式針頭的筆式註射器，我們預計會為我們的業務帶來增量效益。如同先前的電話會議中所指出的，我們最近在德國推出了專門針對 GLP-1 管理的新型小包裝筆針產品。該產品的推出標誌著一個重要的里程碑，我們計劃在未來將產品擴展到更多市場。我們相信，這將有助於滿足對筆式 GLP-1 給藥不斷增長的需求，滿足越來越多使用筆和筆針頭的患者的需求。我們將在春季的投資者日分享更多關於更廣泛的 GLP-1 市場機會的想法，以及我們打算如何在未來幾年中受益。

Our next strategic priority is to widen our product offering by leveraging our core strengths. One of the strongest assets is our global commercial channel comprising of 600-plus commercial resources with deep customer relationships with over half of these resources serving customers in the faster-growing emerging markets. Adding market-appropriate products that can be delivered by our existing channels will allow for increased productivity of our commercial resources. Another core strength is our expertise in high-volume manufacturing while maintaining robust quality standards. Competency in injection molding and operating highly automated plants can be leveraged into making products that benefit from these competencies.

我們的下一個策略重點是利用我們的核心優勢來擴大我們的產品範圍。我們最強大的資產之一是我們的全球商業管道，由 600 多個商業資源組成，這些資源擁有深厚的客戶關係，其中超過一半的資源為成長較快的新興市場的客戶提供服務。添加可以透過我們現有管道提供的適合市場的產品將有助於提高我們商業資源的生產力。另一個核心優勢是我們在大批量製造方面的專業知識，同時保持嚴格的品質標準。射出成型和操作高度自動化工廠的能力可以用來製造受益於這些能力的產品。

While identifying the right products to manufacture will take time, we intend to start exploring the possibilities now.

雖然確定合適的產品來製造需要時間，但我們打算現在就開始探索可能性。

Lastly, increasing financial flexibility is an important priority for us. We recognize that without that, we are going to be limited in the strategic options available to us that could transition the company towards higher-growth markets, improving operational efficiency is at the heart of this priority. We are committed to refining our processes, eliminating inefficiencies and optimizing every aspect of our operations. This approach goes beyond cost cutting. It ensures we remain lean, agile and ready to adapt.

最後，提高財務靈活性是我們的重要優先事項。我們認識到，如果沒有這一點，我們可用的策略選擇將受到限制，而這些策略選擇可以使公司轉向更高成長的市場，而提高營運效率是此優先事項的核心。我們致力於完善流程、消除低效率並優化營運的各個面向。這種方法超出了削減成本的範圍。它確保我們保持精實、敏捷並做好適應的準備。

Additionally, we believe that reducing net leverage and debt creates a stronger financial base that enables us to make strategic investments and remain resilient regardless of market conditions.

此外，我們相信，減少淨槓桿和債務可以創造更強大的財務基礎，使我們能夠進行策略性投資並保持彈性，無論市場狀況如何。

In summary, by strengthening the core business, expanding our product portfolio and increasing financial flexibility, our plan is to build a strong foundation for Embecta's future.

總而言之，透過加強核心業務、擴大產品組合和提高財務靈活性，我們的計劃是為 Embecta 的未來奠定堅實的基礎。

Now let's review our revenue performance for the quarter and the full fiscal year. Before beginning our normal review, I wanted to highlight an event we worked through during the fourth quarter. The Italian government introduced legislation back in 2015 requiring medical device companies that supply goods and services to the Italian National Health Care System to pay back a portion of their proportional revenues to contribute to any deficit created by government budget overspend for medical devices each year. The payment amounts are calculated based on the amount by which the regional ceilings for that given year were exceeded. Numerous medical device companies challenged the enforceability of the law, primarily on the basis that the legislation was unconstitutional.

現在讓我們回顧一下我們本季和整個財年的營收表現。在開始我們的正常回顧之前，我想強調一下我們在第四季度經歷的事件。義大利政府早在 2015 年就出台了立法，要求向義大利國家醫療保健系統提供商品和服務的醫療器材公司償還其比例收入的一部分，以彌補每年政府預算超支造成的赤字。支付金額是根據當年超出地區上限的金額計算。許多醫療器材公司對該法律的可執行性提出質疑，主要理由是該立法違憲。

The Italian administrative courts referred the question regarding the constitutionality of the law to the Italian Constitutional Court, which in July 2024 issued a ruling upholding the law is constitutional. Following the ruling of the Italian Constitutional Court, the appeal before the Italian Administrative Court will proceed with respect to the remaining legal arguments asserted by the appellant regarding the enforceability of the payback law. Since the law was enacted, our fourth quarter and full year revenue includes a reduction to revenue of $4.1 million related to fiscal year 2015 through 2023. Given that this amount relates to prior years, we have normalized for this amount when calculating our adjusted constant currency revenue growth rates for both the quarter and the full year.

義大利行政法院將有關該法律合憲性的問題提交給義大利憲法法院，義大利憲法法院於 2024 年 7 月發布裁決，維持該法律符合憲法。根據義大利憲法法院的裁決，將就上訴人就償還法的可執行性提出的其餘法律論點向義大利行政法院提起上訴。自該法律頒布以來，我們第四季和全年的收入包括與 2015 財年至 2023 年相關的收入減少了 410 萬美元。鑑於該金額與前幾年相關，我們在計算本季和全年調整後的固定貨幣收入成長率時已對該金額進行了標準化。

Additionally, our fourth quarter and full year results also include a $1.2 million reduction of revenue associated with fiscal year 2024. Given that this amount relates to the current year, we have not normalized for this impact, although it was not something that was previously contemplated in our prior financial guidance. As litigation before Italian courts are still pending, final resolution is unknown at this time, and it is possible that the amount of Embecta's liability could differ from the amount currently accrued. Finally, you will notice that in addition to a typical geographic revenue disclosures, we are also providing a breakdown of our revenue on a product family basis.

此外，我們的第四季和全年業績還包括 2024 財年相關收入減少 120 萬美元。鑑於這筆金額與本年度有關，我們尚未將這種影響標準化，儘管我們先前的財務指導中並未考慮到這一點。由於義大利法院的訴訟仍懸而未決，目前尚不清楚最終解決方案，Embecta 的責任金額可能與目前應計的金額有所不同。最後，您會注意到，除了典型的地理收入揭露之外，我們還提供了基於產品系列的收入細目。

With that, I will now begin a review of our revenues for the fourth quarter. All amounts that I will refer to are on an adjusted revenue and adjusted constant currency basis, unless otherwise noted. In the fourth quarter of fiscal year 2024, Embecta's adjusted revenues totaled $290.2 million, which represents an increase of 4.1% as compared to the prior year period or 3.3% if you were to exclude contract manufacturing revenue. This exceeded our prior expectations with the outperformance in the quarter, primarily related to the timing of orders from some distributors. The additional orders occurred as distributors attempted to mitigate any potential impact from the then looming US port strike.

現在，我將開始審查我們第四季的收入。除非另有說明，我提到的所有金額均以調整後的收入和調整後的固定貨幣為基礎。在2024財年第四季，Embecta的調整後營收總計2.902億美元，比上年同期成長4.1%，如果排除合約製造收入則成長3.3%。這超出了我們先前的預期，本季的表現出色，主要與一些經銷商的訂單時間有關。增加訂單的原因是分銷商試圖減輕當時迫在眉睫的美國港口罷工的潛在影響。

While from a product family perspective, during the quarter, pen needle revenue grew approximately 2.8%, syringe revenue grew approximately 4.8%, safety products grew approximately 5.8% and contract manufacturing grew approximately 96%. Within the year, during the quarter, revenues totaled $167.4 million, which represented year-over-year growth of 10.3% on an adjusted constant currency basis. The year-over-year growth was primarily driven by the impact of the aforementioned distributor order timing, favorable pricing and growth in the sales of non-diabetes products that were manufactured and sold to BD.

從產品系列的角度來看，本季筆針營收成長約 2.8%，注射器營收成長約 4.8%，安全產品成長約 5.8%，合約製造成長約 96%。年內，本季營收總計 1.674 億美元，以調整後的固定匯率計算年增 10.3%。年比成長主要是受到上述經銷商訂單時機、優惠定價以及製造和銷售給 BD 的非糖尿病產品銷售成長的影響。

Turning to our international business. During Q4, revenue totaled $122.8 million, which equated to a 3.1% decline on an adjusted constant currency basis as compared to the prior year period. The year-over-year decline within our international business was due to the as expected timing of orders within China in advance of the ERP implementation, as well as absorbing the full year 2024 $1.2 million impact of the Italian payback measure, which was all recorded in the fourth quarter. This was partially offset by year-over-year increases in Canada, Latin America and Asia.

轉向我們的國際業務。第四季度，營收總計 1.228 億美元，以調整後的固定匯率計算，與去年同期相比下降 3.1%。我們的國際業務年減是由於 ERP 實施之前中國境內的訂單時間符合預期，以及吸收了意大利投資回收措施對 2024 年全年 120 萬美元的影響（全部記錄）在第四季度。這被加拿大、拉丁美洲和亞洲的同比增長部分抵消。

Turning to slide 9, for the full year, Embecta generated adjusted revenues of approximately $1.127 billion, which represented an increase of 1.1% on an adjusted constant currency basis and remained unchanged at 1.1%, if you were to exclude contract manufacturing revenue. Globally, our pen needle and safety product lines grew approximately 2.6% and 2.5%, respectively, as compared to fiscal 2023. Together, these two product categories represented around 86% of our consolidated fiscal year 2024 revenue. However, this growth was offset by a decline of approximately 9% within our syringe product lines, primarily driven by ongoing end-market volume declines within the US.

轉向幻燈片 9，Embecta 全年調整後收入約為 11.27 億美元，按調整後固定匯率計算增長 1.1%，如果排除合約製造收入，則保持在 1.1% 不變。在全球範圍內，與 2023 財年相比，我們的筆針和安全產品線分別成長了約 2.6% 和 2.5%。這兩個產品類別合計約占我們 2024 財年合併收入的 86%。然而，這一增長被我們注射器產品線約 9% 的下降所抵消，這主要是由於美國終端市場銷售持續下降所致。

This trend is not new and has persisted over the past several years and is consistent with the decrease in prescriptions for insulin vials as compared with insulin pen.

這種趨勢並不新鮮，並且在過去幾年中一直持續存在，並且與胰島素瓶處方相對於胰島素筆的減少是一致的。

Lastly, the contract manufacturing revenue of non-diabetes products declined approximately 1.5% as compared to the prior year. While from a regional perspective, US revenues totaled $607.2 million, which is an increase of 1% on an adjusted constant currency basis. Growth in the US was primarily due to favorable pricing dynamics, partially offset by continued end market volume declines for syringe products.

最後，非糖尿病產品的合約製造收入較前一年下降約1.5%。而從區域角度來看，美國營收總計 6.072 億美元，以調整後的固定匯率計算成長 1%。美國的成長主要得益於有利的定價動態，但部分被注射器產品終端市場銷售的持續下降所抵消。

Meanwhile, international revenues totaled $520 million, which equated to year-over-year adjusted constant currency growth of approximately 1.3%. Growth internationally was driven primarily by volume growth within Canada, China and Asia, partially offset by declines within EMEA and Latin America. Lastly, and before I turn the call over to Jake, I want to highlight that since spin, we have been able to successfully increase the prices of our products, particularly within the US to help offset inflationary pressures. However, during 2025, we anticipate that pricing will turn into a headwind as we seek to renew agreements whose terms are expiring.

同時，國際營收總計 5.2 億美元，相當於調整後的固定匯率年增約 1.3%。國際成長主要由加拿大、中國和亞洲銷售成長推動，部分被歐洲、中東和非洲和拉丁美洲銷售下降所抵銷。最後，在我把電話轉給傑克之前，我想強調，自旋轉以來，我們已經能夠成功提高我們產品的價格，特別是在美國國內，以幫助抵消通膨壓力。然而，到 2025 年，我們預計，由於我們尋求續約條款即將到期的協議，定價將成為阻力。

With that, let me turn the call over to Jake for him to review other financial highlights as well as to provide our preliminary financial guidance for fiscal year 2025. Jake?

接下來，讓我將電話轉給 Jake，讓他回顧其他財務亮點，並提供我們 2025 財年的初步財務指導。傑克？

Thank you, Dev, and good morning, everyone. Given the discussion that has already occurred regarding revenue, I will start my review of Embecta's financial performance for the fourth quarter at the gross profit line. GAAP gross profit and margin for the fourth quarter of fiscal 2024 totaled $173.8 million and 60.7%, respectively. This compared to $181.8 million and 64.5% in the prior year period. While on an adjusted basis, our Q4 2024 adjusted gross profit and margin totaled $178.3 million and 61.4%.

謝謝你，Dev，大家早安。鑑於已經就收入進行了討論，我將從毛利線開始回顧 Embecta 第四季度的財務表現。2024 財年第四季的 GAAP 毛利和利潤率分別為 1.738 億美元和 60.7%。相比之下，去年同期為 1.818 億美元，成長了 64.5%。在調整後的基礎上，我們 2024 年第四季調整後的毛利和利潤率總計 1.783 億美元，達到 61.4%。

This compared to $182.6 million and 64.8% in the prior year period.

相比之下，去年同期為 1.826 億美元，成長了 64.8%。

The year-over-year decrease in adjusted gross profit and margin was expected and was primarily driven by the impact of lower absorption at our plants as we intentionally reduced inventory levels from Q3 to Q4 as we are now substantially complete with our ERP implementations. Additionally, the year-over-year decline in gross margin in the quarter was also due to revenue mix as well as from the impact of inflation on the cost of certain raw materials, direct labor, freight and overhead, and the negative impact of foreign currency translation, primarily due to the weakening of the US dollar. These headwinds were some offset by favorable pricing.

調整後毛利和利潤率同比下降是預期的，主要是由於我們工廠吸收率下降的影響，我們有意從第三季度到第四季度降低了庫存水平，因為我們現在基本上完成了 ERP 實施。此外，本季毛利率較去年同期下降的原因還包括收入結構、通貨膨脹對某些原材料、直接勞動力、運費和管理費用的影響，以及國外進口的負面影響。這些不利因素在一定程度上被有利的定價所抵消。

While from a sequential basis, we saw a step-down in adjusted gross margin from Q3 to Q4. This was something that we expected to occur and noted on our third quarter earnings conference call, and is due to the profit and inventory benefit we experienced within our third quarter results.

從環比來看，我們看到調整後毛利率從第三季到第四季有所下降。這是我們預計會發生的事情，並在第三季財報電話會議上指出，這是由於我們在第三季業績中經歷的利潤和庫存效益。

Turning to our GAAP operating income and margin. During the fourth quarter, they were $26.2 million and 9.2%. This compared to $25.8 million and 9.2% in the prior year period. While on an adjusted basis, our Q4 2024 adjusted operating income and margin totaled $61.2 million and 21.1%. This compared to $65.2 million and 23.1% in the prior year period.

轉向我們的 GAAP 營業收入和利潤率。第四季的銷售額為 2,620 萬美元，成長率為 9.2%。相比之下，去年同期成長了 2,580 萬美元，成長了 9.2%。在調整後的基礎上，我們 2024 年第四季調整後的營業收入和利潤率總計 6,120 萬美元和 21.1%。相比之下，去年同期成長了 6,520 萬美元，成長了 23.1%。

The year-over-year decrease in adjusted operating income is due to the adjusted gross profit changes I just discussed as total operating expenses were in line with the year ago quarter. Importantly, total operating expenses were flat as compared to the year ago period despite absorbing approximately $2.5 million of additional amortization expense associated with the ERP system implementations that occurred during this year.

調整後營業收入年減是由於我剛才討論的調整後毛利變化，因為總營業費用與去年同期一致。重要的是，儘管今年吸收了與 ERP 系統實施相關的約 250 萬美元的額外攤銷費用，但總營運費用與去年同期持平。

As Dev mentioned earlier, we are continuing to focus on managing operating expenses and becoming a more efficient organization as we move forward.

正如 Dev 之前提到的，隨著我們的前進，我們將繼續專注於管理營運費用並成為一個更有效率的組織。

Turning to the bottom line. GAAP net income and earnings per diluted share was $14.6 million and $0.25 during the fourth quarter of fiscal 2024 which compared to $6 million and $0.10 in the prior year period. While on an adjusted basis, net income and earnings per share were $25.9 million and $0.45 during the fourth quarter of fiscal 2024. This compared to $34.1 million and $0.59 in the prior year period. The decrease in year-over-year adjusted net income and diluted earnings per share is primarily due to the adjusted operating profit drivers I just discussed, as well as an increase in year-over-year interest expense associated with the rise in SOFR and the impact that, that had on our variable interest rate debt.

轉向底線。2024 財年第四季的 GAAP 淨利和稀釋每股收益分別為 1,460 萬美元和 0.25 美元，去年同期為 600 萬美元和 0.10 美元。調整後的 2024 財年第四季淨利和每股盈餘分別為 2,590 萬美元和 0.45 美元。相比之下，去年同期為 3,410 萬美元，0.59 美元。調整後淨利潤和稀釋每股收益同比下降主要是由於我剛才討論的調整後營業利潤驅動因素，以及與 SOFR 和這對我們的可變利率債務產生了影響。

This was somewhat offset by a reduction in our adjusted tax rate from approximately 14% in Q4 of 2023 to approximately 9.5% in Q4 of 2024. The lower non-GAAP tax rate was due to certain tax planning initiatives, which were completed before year-end, as well as the geographic mix of profitability. Lastly, from a P&L perspective, for the fourth quarter of 2024, our adjusted EBITDA and margin totaled approximately $73 million and 25.2%. This compared to $79.6 million and 28.2% in the prior year period. Turning to the balance sheet and cash flow.

我們的調整後稅率從 2023 年第四季的約 14% 降至 2024 年第四季的約 9.5%，在一定程度上抵消了這一影響。非公認會計準則稅率較低的原因是年底前完成的某些稅務規劃措施以及獲利能力的地域組合。最後，從損益表的角度來看，2024 年第四季度，我們調整後的 EBITDA 和利潤率總計約為 7,300 萬美元和 25.2%。相比之下，去年同期成長了 7,960 萬美元，成長了 28.2%。轉向資產負債表和現金流量。

At the end of the fourth quarter, our cash balance totaled approximately $274 million, while our last 12 months net leverage as defined under our credit facility agreement, stood at approximately 3.8 times.

截至第四季末，我們的現金餘額總計約為 2.74 億美元，而我們過去 12 個月的淨槓桿率（根據信貸安排協議定義）約為 3.8 倍。

As a reminder, our net leverage covenant requires us to stay below 4.75 times. Our ending cash balance includes a use of cash during the year of approximately $165 million associated with onetime separation activities. Lastly, during both our second and third quarter earnings calls, I mentioned that we expected to end this year with a cash balance of approximately $300 million and that would have been the case. However, we proactively paid down an additional $25 million of our Term Loan B debt before fiscal year-end. As now that we are substantially complete with separation activities, we want to take steps to pay down debt more aggressively.

提醒一下，我們的淨槓桿契約要求我們保持在 4.75 倍以下。我們的期末現金餘額包括本年度與一次性離職活動相關的約 1.65 億美元的現金使用。最後，在第二季和第三季的財報電話會議上，我提到我們預計今年年底的現金餘額約為 3 億美元，事實也確實如此。然而，我們在財政年度結束前主動償還了額外 2500 萬美元的定期貸款 B 債務。由於現在我們已經基本完成了分離活動，我們希望採取措施更積極地償還債務。

That completes my comments on our fiscal Q4 results. Next, I'll provide a brief review of our full year 2024 financial results. GAAP gross profit and margin for fiscal 2024 totaled $735.2 million and 65.5%, respectively. This compared to $749.9 million and 66.9% in the prior year. While on an adjusted basis, our 2024 adjusted gross profit and margin totaled $740.7 million and 65.7%.

我對第四季財務表現的評論就到此結束。接下來，我將簡要回顧我們 2024 年全年的財務表現。2024 財年 GAAP 毛利和利潤率總計分別為 7.352 億美元和 65.5%。相比之下，去年為 7.499 億美元，成長了 66.9%。在調整後的基礎上，我們 2024 年調整後的毛利和利潤率總計 7.407 億美元和 65.7%。

This compared to $751.2 million and 67% in the prior year. The year-over-year decrease in adjusted gross profit and margin was primarily driven by the impact of inflation on the cost of certain raw materials, direct labor, rate and overhead.

相比之下，去年的增幅為 7.512 億美元，增幅為 67%。調整後毛利和利潤率較去年同期下降主要是由於通貨膨脹對某些原材料、直接勞動力、費率和間接費用的影響。

The impact of negative manufacturing variances stemming from the temporary shutdown of our manufacturing facility in China and the negative impact of foreign currency translation, primarily due to the weakening of the US dollar. These headwinds were somewhat offset by the impact of profit and inventory adjustments resulting from inventory that was sold to external customers that was manufactured in anticipation of our ERP system and other business continuity processes that went live during fiscal year 2024 and favorable pricing.

負製造差異的影響源於我們在中國的製造工廠的暫時關閉以及外幣換算的負面影響（主要是由於美元疲軟）。這些不利因素在一定程度上被利潤和庫存調整的影響所抵消，這些調整是由於銷售給外部客戶的庫存而產生的，這些庫存是根據我們的ERP 系統和其他業務連續性流程在2024 財年上線和有利的定價而製造的。

Turning to GAAP operating income and margin. During 2024, they were $166.8 million and 14.9%. This compared to $221.5 million and 19.8% in the prior year. While on an adjusted basis, our 2024 adjusted operating income and margin totaled $296.9 million and 26.3%. This compared to $331.5 million and 29.6% in the prior year.

轉向 GAAP 營業收入和利潤率。2024 年，這一數字為 1.668 億美元，佔 14.9%。相比之下，去年的增幅為 2.215 億美元，增幅為 19.8%。在調整後的基礎上，我們 2024 年調整後的營業收入和利潤率總計 2.969 億美元和 26.3%。相比之下，上一年增長了 3.315 億美元，增長了 29.6%。

The year-over-year decrease in adjusted operating income is due to a combination of factors, including the adjusted gross profit changes I just discussed as well as an increase in adjusted SG&A. The increase in SG&A costs were all related to standing up the organization and were associated with increased compensation and benefit costs due to increased head count as well as increased outbound freight and warehousing costs. These additional costs were somewhat offset by a reduction in TSA expenses.

調整後營業收入的年減是由多種因素造成的，包括我剛才討論的調整後毛利變化以及調整後SG&A的增加。SG&A 成本的增加都與組織的建立有關，並且與由於人員數量增加以及出境貨運和倉儲成本增加而導致的薪酬和福利成本增加有關。這些額外成本在一定程度上被 TSA 費用的減少所抵銷。

Turning to the bottom line. GAAP net income and earnings per diluted share was $78.3 million and $1.34 during fiscal 2024 which compared to $70.4 million and $1.22 in the prior year. While on an adjusted basis, net income and earnings per share were $143.1 million, and $2.45 during fiscal 2024. This compared to $172.6 million and $2.99 in the prior year. Like my comments relating to the fourth quarter, the decrease in year-over-year adjusted net income and diluted earnings per share is primarily due to the adjusted operating profit drivers I just discussed, as well as an increase in year-over-year interest expense associated with the rise in SOFR, somewhat offset by a reduction in our adjusted tax rate from approximately 23% in 2023 to approximately 20% in 2024.

轉向底線。2024 財年，公認會計準則淨利和稀釋每股收益分別為 7,830 萬美元和 1.34 美元，而前一年為 7,040 萬美元和 1.22 美元。調整後的淨利潤和每股收益為 1.431 億美元，2024 財年為 2.45 美元。相比之下，去年為 1.726 億美元，2.99 美元。就像我對第四季度的評論一樣，調整後淨利潤和稀釋每股收益同比下降主要是由於我剛才討論的調整後營業利潤驅動因素，以及同比利息增加與SOFR 上升相關的費用，在一定程度上被我們調整後的稅率從2023 年約23% 降至2024 年約20% 抵銷。

Lastly, from a P&L perspective, during 2024, our adjusted EBITDA and margin totaled approximately $353.4 million and 31.4%. This compared to $378.7 million and 33.8% in the prior year. In closing, during fiscal year 2024, we were pleased with our ability to raise our financial guidance following each quarter of the year. Ultimately, ending fiscal year 2024 with financial results that were above the high end of our most recently provided guidance ranges for most financial metrics. The ability to generate these results was no small task, particularly given all the separation oriented activities that we focused on during the year.

最後，從損益表的角度來看，2024 年，我們調整後的 EBITDA 和利潤率總計約為 3.534 億美元和 31.4%。相比之下，去年的增幅為 3.787 億美元，增幅為 33.8%。最後，在 2024 財年，我們對能夠在該年每季提高財務指引的能力感到滿意。最終，2024 財年結束時，我們的財務表現高於我們最近為大多數財務指標提供的指導範圍的上限。產生這些結果的能力並非易事，特別是考慮到我們在這一年中重點關注的所有面向分離的活動。

This is a testament to the resiliency of our products and our people we put in countless number of hours to make Embecta successful.

這證明了我們的產品和員工的彈性，我們投入了無數的時間來使 Embecta 取得成功。

That completes my prepared remarks on our fourth quarter and full year 2021 results. Next, I would like to discuss Embecta's preliminary 2025 financial guidance and certain underlying assumptions. Given that we have made the decision to discontinue the insulin patch pump program, our financial guidance metrics for 2025 will exclude all costs associated with the past pump program for the entirety of the year. As Dev mentioned earlier, we anticipate that this restructuring and shutdown of the program will be largely complete during the first half of fiscal year 2025. Additionally, for comparability purposes, as we move forward during the year, we will also update our prior year 2024 adjusted financial results to also exclude the costs we incurred associated with the patch pump program.

我準備好的 2021 年第四季和全年業績的評論就到此結束。接下來，我想討論 Embecta 的 2025 年初步財務指引和某些基本假設。鑑於我們已決定停止胰島素貼片幫浦項目，我們 2025 年的財務指導指標將排除與過去全年幫浦項目相關的所有成本。正如 Dev 之前提到的，我們預計該計劃的重組和關閉將在 2025 財年上半年基本完成。此外，出於可比性目的，隨著我們今年的進展，我們還將更新上一年 2024 年調整後的財務業績，以排除與補丁泵計畫相關的成本。

As a reminder, during fiscal year 2024, we incurred approximately $63 million of total expense related to the pump program or approximately $16 million per quarter.

提醒一下，在 2024 財年，我們與泵浦專案相關的總費用約為 6,300 萬美元，即每季約 1,600 萬美元。

With that, let me review our initial 2025 financial guidance ranges, beginning with revenue. On an adjusted constant currency basis, we currently anticipate that our revenues will be down between 1% and 2.5% as compared to 2024. At the high end of our constant currency revenue range, we have factored in that volumes remain relatively flat as declines in the US are offset by continued growth within emerging markets, most notably China and Asia. While from a pricing perspective, during 2025, we anticipate that price will be a headwind of approximately 1% due to the pricing concessions that Dev mentioned earlier, related to the renewal of agreements whose terms are expiring.

接下來，讓我回顧我們最初的 2025 年財務指導範圍，從收入開始。在調整後的固定匯率基礎上，我們目前預計與 2024 年相比，我們的營收將下降 1% 至 2.5%。在我們的固定貨幣收入範圍的高端，我們考慮到交易量保持相對平穩，因為美國的下降被新興市場（尤其是中國和亞洲）的持續成長所抵消。而從定價角度來看，由於 Dev 先前提到的與條款即將到期的協議續約相關的定價優惠，我們預計 2025 年價格將上漲約 1%。

While at the low end, we are assuming all the same factors impacting our high end except for the potential of greater year-over-year headwinds associated with volumes within the US.

在低端，我們假設影響高端的所有因素相同，除了與美國國內銷量相關的同比阻力可能更大之外。

Turning to our thoughts on FX. Our initial guidance calls for a foreign currency headwind of approximately 0.6% during 2025. This assumption is based on foreign exchange rates that were in existence around the mid-November time frame, including a euro to US dollar exchange rate of approximately $1.08. Somewhat offsetting FX is the fact that our as-reported 2025 GAAP revenue will not be impacted by the 2015 through 2023 amount that we needed to accrue associated with the Italian payback measure, which impacted our 2024 as reported GAAP revenue.

談談我們對外匯的看法。我們的初步指引要求 2025 年外匯逆風約為 0.6%。這項假設是基於 11 月中旬左右的外匯匯率，其中歐元兌美元匯率約為 1.08 美元。在某種程度上抵銷了外匯因素的是，我們報告的2025 年GAAP 收入不會受到2015 年至2023 年我們需要與義大利投資回收措施相關的累積金額的影響，這影響了我們2024 年報告的GAAP 收入。

This equates to a tailwind of approximately 0.4%. On a combined basis, our as-reported revenue guidance calls for a decline of between 1.2% and 2.7% resulting in an initial revenue guide of between $1.093 billion and $1.110 billion.

這相當於大約 0.4% 的順風。綜合來看，我們報告的收入指導要求下降 1.2% 至 2.7%，導致初始收入指導在 10.93 億美元至 11.10 億美元之間。

Turning to adjusted gross margin. We currently anticipate that our 2025 adjusted gross margin will be in the range of between 63.25%, and 64.25% or decline at the midpoint of approximately 200 basis points as compared to 2024 levels. The largest anticipated year-over-year headwind being that we will not see the same benefit in 2025 that we did in 2024 related to profit in inventory, which alone is expected to be a year-over-year headwind of approximately 150 basis points.

轉向調整後的毛利率。我們目前預計 2025 年調整後毛利率將在 63.25% 至 64.25% 之間，或與 2024 年水準相比下降約 200 個基點的中點。預計最大的同比逆風是，我們在 2025 年將不會看到與 2024 年相關的庫存利潤帶來的相同的好處，預計僅此一點就將同比逆風約 150 個基點。

Additional gross margin headwinds are associated with pricing and inflation which are somewhat offset by a variety of productivity initiatives identified by our manufacturing team. Continuing down the P&L, given that we are largely complete with separation, including the establishment of necessary internal full-time resources, we expect that our adjusted SG&A as a percentage of revenue will be flattish as compared to 2024 levels. While from an adjusted R&D perspective, which excludes the patch pump program, we expect R&D as a percentage of revenue to approximate 2%. All total, we anticipate that our adjusted operating margin during 2025 will be between the range of 29% and 30%.

額外的毛利率阻力與定價和通貨膨脹有關，但我們的製造團隊確定的各種生產力措施在一定程度上抵消了這些阻力。繼續降低損益表，鑑於我們已基本完成分離，包括建立必要的內部全職資源，我們預計調整後的銷售及管理費用佔收入的百分比將與 2024 年的水平持平。而從調整後的研發角度來看，不包括貼片幫浦項目，我們預期研發佔營收的比例約為 2%。總的來說，我們預計 2025 年調整後的營業利潤率將在 29% 至 30% 之間。

Moving to earnings. During 2025, our initial guidance calls for an adjusted diluted earnings per share range of between $2.70 and $2.90 and is based on a weighted average diluted share amount of 58.9 million shares. Our initial adjusted earnings per share range includes an assumption that during 2025, we will repay approximately $110 million in debt and that our annual net interest expense will be approximately $107 million. Our guidance assumes that we will use between $50 million and $60 million of cash during fiscal 2025 associated with separation costs, largely related to brand transition between $25 million and $30 million in cash usage associated with the discontinuation of our insulin patch pump program and approximately $20 million in capital expenditures. While from a tax perspective, our initial adjusted earnings per share range assumes that our annual adjusted tax rate will be approximately 25% which includes the impact of Pillar Two.

轉向盈利。2025 年，我們的初步指導要求調整後的稀釋每股收益範圍在 2.70 美元至 2.90 美元之間，並基於 5890 萬股的加權平均稀釋股份金額。我們最初調整後的每股盈餘範圍包括這樣的假設：在 2025 年，我們將償還約 1.1 億美元的債務，而我們的年度淨利息支出將約為 1.07 億美元。我們的指導假設我們將在2025 財年使用5,000 萬至6,000 萬美元的現金用於與分離成本相關，主要與品牌轉型相關，與終止胰島素貼片幫浦專案相關的現金使用量為2,500 萬至3,000 萬美元，以及約20 美元萬元資本支出。而從稅務角度來看，我們最初調整後的每股盈餘範圍假設我們的年度調整後稅率約為 25%，其中包括第二支柱的影響。

Lastly, our initial guidance for fiscal year 2025 calls for an adjusted EBITDA margin of between 35.5% and 36.5%. And before I turn the call over to the operator, I'd like to highlight some considerations regarding the cadence of quarterly revenue expectations during 2025. Moving forward, we may not provide any further commentary concerning the quarterly cadence of revenue on an ongoing basis. During fiscal year 2024, we generated approximately 50% of our adjusted revenue dollars during the first half of the year, including approximately 25% during the first quarter. During 2025, we currently anticipate generating a slightly lower percentage of our annual revenue during both the first quarter and first half of 2025 as compared to the prior year periods.

最後，我們對 2025 財年的初步指導要求調整後的 EBITDA 利潤率在 35.5% 至 36.5% 之間。在我將電話轉交給運營商之前，我想強調一些有關 2025 年季度收入預期節奏的考慮因素。展望未來，我們可能不會持續提供有關季度收入節奏的進一步評論。在 2024 財年，我們調整後營收的約 50% 是在上半年產生的，其中約 25% 是在第一季產生的。目前，我們預計 2025 年第一季和上半年的年收入百分比將略低於去年同期。

Since the first half of 2024 revenue was positively impacted by customers buying additional products in advance of our ERP implementations, as well as because of the additional orders we received from some US distributors during Q4 of 2024 due to the then looming US port strike.

自2024 年上半年以來，我們的收入受到客戶在我們實施ERP 之前購買額外產品的積極影響，以及由於當時迫在眉睫的美國港口罷工，我們在2024 年第四季度從一些美國分銷商那裡收到了額外訂單。

That completes my prepared remarks. And at this time, I would like to turn the call over to the operator for questions. Operator?

我準備好的發言就到此結束。此時，我想將電話轉給接線生詢問。操作員？

(Operator Instructions) Marie Thibault, BTIG.

（操作員說明）Marie Thibault，BTIG。

Congrats on a great quarter and guide. I wanted to ask here about the patch pump program and try to understand a little bit better what's coming next. Congrats on making a decision there. But I want to understand a little bit about what you're hoping to do with the free cash flow generation in addition to paying down debt? Are there other capital allocation priorities that you want to highlight, whether that's -- I know you pay a dividend, but increasing a dividend or share repurchases or potentially M&A? Anything else to consider there?

祝賀一個偉大的季度和指南。我想在這裡詢問有關補丁泵計劃的信息，並嘗試更好地了解接下來會發生什麼。恭喜你在那裡做出了決定。但我想了解一下，除了償還債務之外，您還希望利用自由現金流的產生做什麼？您是否想強調其他資本配置優先事項，無論是—我知道您支付股息，但增加股息或股票回購或潛在的併購？還有什麼要考慮的嗎？

Maybe I'll kick off and then Jake can augment as needed. So regarding the patch pump, it was truly just a very pragmatic capital allocation decision. And it was after achieving a pivotal milestone. As I said in my prepared remarks, we did a market check as well. With regard to capital allocation, our number one priority right now is to pay down debt because we think that being able to do that will actually create the financial flexibility to make some M&A moves.

也許我會開始，然後傑克可以根據需要進行增強。因此，關於補丁泵，這確實只是一個非常務實的資本配置決策。那是在實現了一個關鍵的里程碑之後。正如我在準備好的發言中所說，我們也進行了市場調查。關於資本配置，我們目前的首要任務是償還債務，因為我們認為，能夠做到這一點實際上將為進行一些併購措施創造財務靈活性。

Continuing to invest in the patch pump would have squeezed out any opportunities for us either on the M&A side or frankly, even making additional investments in our own manufacturing or commercial capabilities.

繼續投資貼片幫浦將會擠壓我們在併購方面的任何機會，或者坦白說，甚至在我們自己的製造或商業能力上進行​​額外的投資。

So just to be very clear about that, even though I covered it exhaustively, I believe, in the prepared remarks, this was purely a capital allocation decision, had nothing to do with the design of the pump or the performance of our team with respect to meeting internal milestones. As you pointed out, we already pay a dividend to our shareholders. At this point, we don't see any change in that. And our focus certainly in fiscal 2025 is going to be on paying down that debt, creating the financial flexibility. We still have one more separation-related thing to do, which is brand transition, executing that very well.

因此，要非常清楚地說明這一點，即使我詳盡地介紹了這一點，我相信，在準備好的發言中，這純粹是一個資本分配決定，與泵的設計或我們團隊的表現無關達到內部里程碑。正如您所指出的，我們已經向股東支付股息。目前，我們沒有看到任何變化。我們 2025 財年的重點當然是償還債務，創造財務彈性。我們還有一件與分離相關的事情要做，那就是品牌轉型，執行得非常好。

That's a complex program as well. And certainly, when it comes to M&A, we'll share more of those thoughts at the upcoming Analyst Day.

這也是一個複雜的程序。當然，當談到併購時，我們將在即將到來的分析師日分享更多這些想法。

But we certainly intend to find opportunities that are going to allow us to leverage our global commercial channel of 600-plus commercial employees around the world, particularly in emerging markets, which are faster growing as well as leverage our manufacturing competencies, particularly in injection molding, and the fact that we make 8 billion devices a year with robust quality standards. And so those are the areas related to which that we will look into, but certainly, we'll share more at the Analyst and Investor Day in spring of 2025, Marie.

但我們當然希望找到機會，使我們能夠利用我們在世界各地（特別是在成長更快的新興市場）擁有 600 多名商業員工的全球商業管道，並利用我們的製造能力，特別是在註塑領域，以及我們每年生產80 億台具有嚴格品質標準的設備。因此，這些是我們將研究的相關領域，但當然，我們將在 2025 年春季的分析師和投資者日分享更多內容，瑪麗。

Maybe just to add on just briefly here. I think in terms of cash usage, I think the way that you should sort of think about it is, we ended 2024 with a cash balance of roughly $274 million on the balance sheet. I think our expectation is, is that we'll probably end 2025 with a similar, maybe slightly higher amount of cash on our balance sheet. And essentially, any of the savings, if you will, Marie, from not having to spend in those onetime separation costs, we expect to spend about -- we spent around $165 million in 2024 related to onetime separation costs.

也許只是在這裡簡單補充一下。我認為就現金使用而言，我認為你應該這樣思考：截至 2024 年，我們的資產負債表上的現金餘額約為 2.74 億美元。我認為我們的預期是，到 2025 年結束時，我們的資產負債表上的現金數量可能會類似，甚至可能略高。瑪麗，如果您願意的話，從本質上講，我們預計將在 2024 年花費約 1.65 億美元與一次性離職費用相關的費用，從而節省下來的費用。

We mentioned that we intend to spend around $50 million to $60 million this year, largely around brand transition in 2025. So I think those cash savings of around $110 million, that's really going to get repurposed into debt paydown in 2025. And to the extent that we're able to continue to generate more cash, I think we'll even more aggressively try and pay down debt. But that's sort of the base case assumptions. And I think if you think about what our guide implies, today, in terms of net leverage, it would sort of indicate that by year-end, we would get down to around a 3 times net levered mark.

我們提到，今年我們打算花費約 5,000 萬至 6,000 萬美元，主要圍繞著 2025 年的品牌轉型進行。因此，我認為大約 1.1 億美元的現金節省將在 2025 年重新用於償還債務。如果我們能夠繼續產生更多現金，我認為我們將更積極地嘗試償還債務。但這是基本情況假設。我認為，如果你考慮我們今天的指南所暗示的內容，就淨槓桿率而言，這將表明到年底，我們將降至淨槓桿率的 3 倍左右。

And I think as we move into 2026 the free cash flow capabilities of the company will even improve more so, as we don't see any really meaningful separation oriented spending. So hopefully, that provides a little bit more detail for you.

我認為，隨著我們進入 2026 年，公司的自由現金流能力甚至會進一步提高，因為我們沒有看到任何真正有意義的分離導向支出。希望這能為您提供更多細節。

Yes. That's very helpful. And then I guess I'll ask kind of a macro question. We're getting more tariff headlines, of course, this morning. Can you just confirm for us your thoughts on sort of any impacts, if any, from potential tariffs in China, Mexico and elsewhere and any thoughts on, I guess, you're including, Pillar Two in your taxes. Any thoughts on FX and some of the big moves we've seen recently. Just any further thoughts on some of those macro points.

是的。這非常有幫助。然後我想我會問一個宏觀問題。當然，今天早上我們收到了更多關稅頭條新聞。您能否向我們確認一下您對中國、墨西哥和其他地方的潛在關稅可能產生的任何影響（如果有的話）的想法，以及我想您在稅收中包括的第二支柱的任何想法。關於外匯的任何想法以及我們最近看到的一些重大舉措。只是對其中一些宏觀觀點有任何進一步的想法。

Again, I'll kick off with tariffs and turn it over to Jake to talk about taxes and FX. So obviously, tariff policy, we all expect will continue to evolve. But based on what we know today, very -- a very, very small portion of our US revenue is from products manufactured in China. And with respect to tariffs from China, I mean, it remains to be seen how customers may react to products that they currently source from China that might get tariff in the future.

再次，我將從關稅開始，然後將其交給傑克談論稅收和外匯。顯然，我們都預期關稅政策將繼續發展。但根據我們今天所知，我們美國收入的非常非常小的一部分來自中國製造的產品。關於來自中國的關稅，我的意思是，客戶對他們目前從中國採購的、未來可能會徵收關稅的產品有何反應還有待觀察。

Supply uncertainty of those products might create an opportunity for us that we certainly we stand ready to capitalize on.

這些產品的供應不確定性可能會為我們創造一個機會，我們當然已經準備好利用這個機會。

And look, we'll watch this space and respond accordingly. The overnight headlines around Canada and Mexico, we don't manufacture products in Canada and Mexico. Obviously, we would need to review all those guidelines when they come out in more detail. And certainly, at this point, it's difficult to forecast any retaliatory tariffs that Canada and Mexico may apply on us. Canada and Mexico are both important markets for us.

看，我們將觀察這個空間並做出相應的反應。加拿大和墨西哥的隔夜頭條新聞是，我們不在加拿大和墨西哥生產產品。顯然，當所有這些指南更詳細地發佈時，我們需要對其進行審查。當然，目前很難預測加拿大和墨西哥可能會對我們徵收任何報復性關稅。加拿大和墨西哥都是我們的重要市場。

So we'll certainly watch this space, Marie. I know it's rapidly developing and certainly, we'll update on future calls as sort of our perspective becomes clearer. Jake?

所以我們一定會關注這個空間，瑪麗。我知道它正在迅速發展，當然，隨著我們的觀點變得更加清晰，我們會更新未來的電話會議。傑克？

Yes, Marie, as it relates to the tax rate. So I think our non-GAAP tax rate in 2024 was around 20%. I think the team did a very nice job of trying to implement a variety of different planning initiatives, particularly towards the end of the year that allowed that to continue to go down. Keep in mind that also included any of the expenses in 2024 associated with the patch pump. Meanwhile, in 2025, our guidance, obviously, excludes any of the expenses associated with the patch pump for the full year.

是的，瑪麗，因為這與稅率有關。所以我認為 2024 年我們的非 GAAP 稅率約為 20%。我認為團隊在嘗試實施各種不同的規劃措施方面做得非常好，特別是在年底，這使得這種情況繼續下降。請記住，這還包括 2024 年與貼片幫浦相關的任何費用。同時，到 2025 年，我們的指導顯然不包括全年與貼片幫浦相關的任何費用。

So it is somewhat of an apples-to-oranges comparison.

所以這有點像是蘋果與橘子的比較。

But if I had to try and bridge from the 20% to the 25% in 2025, I would say that around 2.5% of that 5% increase alone is due to the impact of Pillar Two. And then the remainder is really due to a mix of additional US tax on foreign earnings as well as just less R&D tax credits that we would expect to occur. From an FX standpoint, again, I think we sort of pegged our initial guidance and closed that down a couple of weeks ago with the FX rates that existed in the sort of mid-November time frame, including a euro of 108, I think that, obviously, we'll have to continue to keep track of how those FX moves continue to perform during the course of the year.

但如果我必須嘗試在 2025 年從 20% 過渡到 25%，我會說，僅 5% 的增長中就有大約 2.5% 是由於第二支柱的影響。剩下的部分實際上是由於美國對海外收入徵收的額外稅以及我們預期會出現的研發稅收抵免減少所致。從外匯的角度來看，我認為我們在某種程度上固定了我們的初步指導，並在幾週前將其與 11 月中旬時間範圍內存在的匯率（包括 108 歐元）掛鉤，我認為顯然，我們必須繼續追蹤這些外匯走勢在這一年的表現。

But in relation to year over year, I think our original -- our initial guide today would assume a revenue headwind of around $6 million. And I think an adjusted earnings per share headwind year over year of around, let's call it, around $0.05.

但與去年同期相比，我認為我們最初的——我們今天的最初指南將假設收入逆風約為 600 萬美元。我認為，調整後的每股盈餘逐年逆風，我們可以這樣稱呼，大約是 0.05 美元。

Kallum Titchmarsh, Morgan Stanley.

卡勒姆·蒂奇馬什，摩根士丹利。

Just on the patch pump, I feel like many of the points you mentioned when it comes to rationalizing the discontinuation. We're pretty well known for some time. We knew it would require a step-up in R&D, we knew you'd need to establish that sales force and new competition had been intensifying in the space for many years. So why do you think it's this much time to decide to discontinue the program? Would just love a bit more color on that thought process, if possible? And then I have one follow-up.

就貼片泵而言，我覺得您在合理化停產時提到的許多觀點都是如此。我們已經相當出名有一段時間了。我們知道這需要加強研發，我們知道您需要建立銷售隊伍，並且該領域多年來一直在加劇新的競爭。那麼您認為為什麼現在才決定終止該計劃呢？如果可能的話，是否希望在思考過程中多一點色彩？然後我有一個後續行動。

I'll take that. Look as I mentioned, I mean, at this point, as we look forward over the next several years and want to create opportunities for growth that are perhaps more aligned with the company's core strength, we decided that taking those savings and focusing on debt pay down was the best option going forward. But with regard to your question of why now? Let me say this, right? I mean if we think about 12 to 18 months ago, there was certainly deal activity going on around pumps.

我會接受的。正如我所提到的，我的意思是，在這一點上，當我們展望未來幾年並希望創造可能更符合公司核心實力的增長機會時，我們決定利用這些節省並專注於債務償還向下是未來最好的選擇。但關於你的問題為什麼是現在？讓我這麼說吧？我的意思是，如果我們想想 12 到 18 個月前，肯定存在圍繞泵的交易活動。

There was fundraising activity going around pumps. And at that time, we were on the doorsteps of submitting our 510(k) application to the FDA.

圍繞泵進行了籌款活動。當時，我們即將向 FDA 提交 510(k) 申請。

And we decided that going through the process, getting clearance and then looking for ways to monetize that asset was, of course, we decided to pursue, which we did. We got the clearance, as soon as we got the clearance, we did a market check to evaluate opportunities to monetize the asset, none surfaced. And obviously, over this time, there's certainly -- the market has continued to evolve, not just in the pump space, which also in the drug space. And so we just made a pragmatic decision that given that the market check had not turned up any alternatives even for a 510(k) cleared pump, given what we saw with respect to how we should allocate our capital in the future, we promptly after clearance decided to discontinue the program once the market check was complete.

我們決定，透過這個過程，獲得許可，然後尋找將該資產貨幣化的方法，當然，我們決定追求，我們也這樣做了。我們得到了許可，一得到許可，我們就進行了市場檢查，以評估資產貨幣化的機會，但沒有出現。顯然，在這段時間裡，市場肯定在持續發展，不僅僅是在泵浦領域，在藥品領域也是如此。因此，我們只是做出了一個務實的決定，考慮到市場檢查甚至沒有找到任何替代方案，即使是 510(k) 清除的泵，考慮到我們所看到的關於未來如何分配資本的情況，我們立即市場檢查完成後，Clearance 決定停止該計劃。

That's helpful. And then when thinking about new opportunities to push into, are there any restrictions we should be aware of that relates to BD post-spin. I think maybe auto-injectors was called out historically as something that maybe could have been developed in-house, but correct me if I'm wrong with there.

這很有幫助。然後，當考慮新的機會時，我們應該注意與 BD 後旋轉相關的任何限制嗎？我想也許自動注射器在歷史上被稱為可能是內部開發的東西，但如果我錯了，請糾正我。

Look, from an M&A perspective, certainly, there are no restrictions. Once we have paid down debt and created some financial flexibility ourselves, we can certainly proceed in any area that makes sense for us as a company. They are certainly as part of our separation agreement, there are restrictions on what we can do with the technology that was acquired by us at the point of separation. So there are certainly some restrictions around that. But in terms of our go-forward strategy, which is why creating this financial flexibility is so important because it really creates a vast space for us to go explore and that leverages our core competencies.

從併購的角度來看，當然沒有任何限制。一旦我們償還了債務並創造了一定的財務靈活性，我們當然可以在對我們公司有意義的任何領域繼續前進。它們當然是我們分居協議的一部分，我們可以使用我們在分居時獲得的技術來做什麼。因此，這肯定存在一些限制。但就我們的前進策略而言，這就是為什麼創造這種財務靈活性如此重要，因為它確實為我們創造了廣闊的探索空間，並充分利用了我們的核心競爭力。

Michael Polark, Wolfe Research.

邁克爾·波拉克，沃爾夫研究中心。

Two follow-ups on the patch pumps decision. I'll ask the question this way. Do you think there still could be residual value here? I agree that the pump market continues to intensify. However, as it relates to patch options, the US market is still several years away. And so you were kind of, I think, as close as anyone. And so while you said you've conducted a market check, is there a chance that there's interest in absorbing or taking over your product from someone else? Or as you restructure here, does that kind of shut the door for that possibility?

關於貼片幫浦決定的兩個後續行動。我會這樣問問題。您認為這裡還有剩餘價值嗎？我同意泵市場繼續加劇。然而，就補丁選項而言，美國市場還需要幾年的時間。所以我認為你們和其他人一樣親密。因此，雖然您說您已經進行了市場調查，但是否有可能有興趣從其他人那裡吸收或接管您的產品？或者當你在這裡重組時，這是否會關閉這種可能性的大門？

So look, at this point, I would say the market check that we did, we arrived at the conclusion that there wasn't a viable option to monetize the asset. Would I ever rule anything out in the future if somebody approached us? Obviously, we'd be open to it. With the restructure, certainly, we are taking firm steps today to discontinue the program. But if somebody was interested in the value of the asset, the IP, all of that. Certainly, we'd be open to those discussions, Mike.

所以看，在這一點上，我想說的是我們所做的市場檢查，我們得出的結論是，沒有可行的選擇來將資產貨幣化。如果將來有人聯絡我們，我會排除任何可能性嗎？顯然，我們對此持開放態度。當然，隨著重組，我們今天將採取堅定措施終止該計劃。但如果有人對資產、智慧財產權等所有這些的價值感興趣。當然，我們願意接受這些討論，麥克。

Understood. I appreciate that. The follow-up is on the savings from this update. Jake, I heard $63 million of expense on the pump in fiscal '24, sounded familiar. The guidance on a pro forma basis for the benefit from this restructuring program is $60 million to $65 million.

明白了。我很欣賞這一點。後續內容是關於此更新帶來的節省。傑克，我聽說 24 財年的泵浦費用為 6,300 萬美元，聽起來很熟悉。預計此次重組計劃帶來的收益為 6,000 萬至 6,500 萬美元。

So it's kind of captures the spend last year. But it sounds like there might be something more than just the patch pump discontinuation in this restructuring announcement. So is there or is this really contained to the patch program and therefore, that's why the savings numbers align?

所以這有點反映了去年的支出。但聽起來這次重組公告中可能不只停止貼片幫浦。那麼，是否存在或確實包含在補丁程式中，因此，這就是節省數字一致的原因？

Yes, Mike, you're correct. It's really the restructuring announcement that we made this morning, is tied to the discontinuation of the pump, hence, the alignment of the figures from 2024 into our thoughts on the annualized basis going forward into 2025 and beyond. Now that said, I would say that now that we're through separation, and I think we're going to continue to look for ways moving forward, to continue to reduce costs and just cost optimization. So that is certainly nothing that is necessarily factored into our numbers that we put out today in terms of our guidance. But obviously, now that we're through separation, we're going to continue to try and just be as efficient as possible in terms of our operating cost structure.

是的，麥克，你是對的。這實際上是我們今天早上發布的重組公告，與泵浦的停產有關，因此，我們將 2024 年的數據與我們對 2025 年及以後年化基礎的想法進行了調整。話雖如此，我想說，現在我們已經完成了分離，我認為我們將繼續尋找前進的方法，繼續降低成本並優化成本。因此，這當然不是我們今天發布的指導數據中必然要考慮的因素。但顯然，既然我們已經完成了分離，我們將繼續努力，在營運成本結構方面盡可能提高效率。

(Operator Instructions) I'm showing no further questions in the queue at this time. I would now like to turn the call back over to Dev for any closing remarks.

（操作員說明）此時我在隊列中沒有顯示任何其他問題。我現在想將電話轉回給 Dev，讓其發表結束語。

Thank you, operator. As we wrap up the call, I want to extend my heartfelt appreciation to all my colleagues at Embecta across the globe. As you look back over the last 2.5 years, our global team has executed complex major separation initiatives with dedication and resilience and achieve the expectations that we had laid out even prior to spin. With that said, I also want to acknowledge the restructuring plan that we announced today and recognize that these changes have impacted many of our valued team members. To those affected, we are sincerely grateful for your contributions and I'm conscious of the difficult transitions that this decision has brought for so many.

謝謝你，接線生。在我們結束電話會議時，我想向全球 Embecta 的所有同事表示衷心的感謝。回顧過去 2.5 年，我們的全球團隊以奉獻精神和韌性執行了複雜的重大分離計劃，並實現了我們在分拆之前就設定的期望。話雖如此，我還要感謝我們今天宣布的重組計劃，並認識到這些變化影響了我們許多重要的團隊成員。對於那些受影響的人，我們衷心感謝你們的貢獻，我意識到這個決定為許多人帶來了艱難的轉變。

We believe these changes though challenging are necessary steps to strengthen Embecta, setting us up for a stronger, more sustainable future. Finally, we look forward to engaging with all of you at upcoming conferences and at our reschedule Investor Day in spring of 2025, where we'll share more about our vision for Embecta. I wish you and your loved ones a happy Thanksgiving. Thank you.

我們相信，這些變化雖然具有挑戰性，但卻是加強 Embecta 的必要步驟，為我們創造一個更強大、更永續的未來。最後，我們期待在即將舉行的會議以及重新安排在 2025 年春季的投資者日上與大家互動，屆時我們將分享更多有關 Embecta 的願景。祝您和您所愛的人感恩節快樂。謝謝。

This concludes today's program. Thank you all for participating. You may now disconnect.

今天的節目到此結束。感謝大家的參與。您現在可以斷開連線。