Enovis Corp (ENOV) 2025 Q1 法說會逐字稿

Hello everyone and welcome to the Enovis Corporation Q1 2025 results call. My name is Ezra, and I will be your coordinator today. (Operator Instructions)

大家好，歡迎參加 Enovis Corporation 2025 年第一季業績電話會議。我叫伊茲拉，今天我將擔任您的協調員。（操作員指示）

I will now hand you over to your host, Kyle Rose, Vice President of Investor Relations, to begin. Please go ahead.

現在我將把主持人、投資者關係副總裁 Kyle Rose 交給您開始。請繼續。

Thank you, Ezra. Good morning, everyone, and thank you for joining us today for our first-quarter 2025 results conference call. I'm Kyle Rose, Vice President of Investor Relations. Joining me on the call today are Matt Trerotola, Chair and Chief Executive Officer, and Ben Berry, Chief Financial Officer. Our earnings release was issued earlier this morning and is available in the investor section of our website, enovis.com. We will be using a slide presentation in today's call, which can also be found on our website. Both the audio and the slide presentation will be archived on the website later today.

謝謝你，埃茲拉。大家早安，感謝您今天參加我們的 2025 年第一季業績電話會議。我是投資人關係副總裁凱爾‧羅斯 (Kyle Rose)。今天與我一起參加電話會議的還有董事長兼執行長 Matt Trerotola 和財務長 Ben Berry。我們的收益報告已於今天早上發布，可在我們網站 enovis.com 的投資者專區查閱。今天的電話會議將使用幻燈片演示，您也可以在我們的網站上找到。音訊和幻燈片演示將於今天晚些時候存檔在網站上。

During this call, we'll be making some forward-looking statements about our beliefs and estimates regarding future events and results. These forward-looking statements are subject to risks and uncertainties, including those set forth in the Safe Harbor language in today's earnings release and in our filings with the SEC. Actual results might differ materially from any forward-looking statements that we make today. The forward-looking statements speak only as of today, and we do not assume any obligation or intend to update them except as required by law. For further details regarding any non-GAAP financial measures referenced during the call today, the accompanying reconciliation information relating to those measures can be found in our earnings press release and in the appendix of today's slide presentation. With that, let me turn it over to Matt, who will begin on slide 3.

在本次電話會議中，我們將就未來事件和結果的信念和估計做出一些前瞻性陳述。這些前瞻性陳述受風險和不確定性的影響，包括今天的收益報告中的安全港語言和我們向美國證券交易委員會提交的文件中規定的風險和不確定性。實際結果可能與我們今天所做的任何前瞻性陳述有重大差異。前瞻性陳述僅代表截至今日的觀點，除非法律要求，否則我們不承擔任何義務或打算更新這些陳述。有關今天電話會議中提到的任何非 GAAP 財務指標的更多詳細信息，可以在我們的收益新聞稿和今天幻燈片演示的附錄中找到與這些指標相關的隨附對帳資訊。接下來，讓我把時間交給 Matt，他從第 3 張投影片開始解說。

Thanks. Hello, everyone, and thanks for joining us this morning. Let's start on slide 3 and talk about some of the quarter's highlights. We had a strong start to the year and I'm excited about the future of Enovis.

謝謝。大家好，感謝大家今天早上加入我們。讓我們從第 3 張幻燈片開始，討論本季的一些亮點。我們今年有一個好的開端，我對 Enovis 的未來充滿期待。

In the first quarter, we delivered reporting growth of 8% and 11% on a comparable basis. When we looked through the extra days in currency to the effective growth rate, it's right in line with our high-single digit strategic goals. Our teams have made tremendous progress using new products to drive share gain, and we have a clear line of sight to a multi-year cadence of meaningful NTI. We expanded our adjusted EBITDA margins by 160 basis points, reflecting the mixed impact of Recon, stable pricing trends, and EGX driven productivity improvements.

第一季度，我們的報告成長率為 8%，年成長率為 11%。當我們將貨幣的額外天數與有效成長率進行比較時，它與我們的高個位數策略目標完全一致。我們的團隊在使用新產品推動市場份額成長方面取得了巨大進步，並且我們對多年有意義的 NTI 節奏有著清晰的認識。我們將調整後的 EBITDA 利潤率提高了 160 個基點，反映了 Recon、穩定的價格趨勢和 EGX 推動的生產力提高的混合影響。

In Recon on slide 4, we delivered comparable growth of 13%, which includes some tailwinds from additional selling days. US Recon grew 11%, including 12% growth in US extremities and 10% growth in hips and knees. We're once again consistently growing well above market rates in the US as our teams are energized, focused on growth, and have great innovation supporting their surge in conversion efforts.

在第 4 張投影片的 Recon 中，我們實現了 13% 的可比成長，其中包括額外銷售日帶來的一些順風。美國偵察增長了 11%，其中美國四肢增長了 12%，臀部和膝蓋增長了 10%。由於我們的團隊充滿活力、專注於成長，並擁有強大的創新能力來支持其轉化努力的激增，我們再次在美國持續以遠高於市場的速度成長。

Outside the US, we grew 14% in a resilient market, showing the power of the global position that we've built. We exited the first quarter with strong momentum and excitement from recent and upcoming new product launches, including the augmented reverse glenoid system in shoulders, the nebula stem and surgical factor in hip, and the next generation of RVs, hardware and software.

在美國以外的市場中，我們實現了 14% 的成長，彰顯了我們所建立的全球地位的強大力量。我們在第一季結束時表現出強勁的勢頭和對最近和即將推出的新產品的興奮，包括肩部的增強型反向關節盂系統、髖部的星雲柄和手術因素以及下一代 RV、硬體和軟體。

In P&R on slide 5, our 8% comparable growth reflects a stable market environment, disciplined execution, and the benefit of additional selling days. Overall, this business is performing in line with our strategic plan and will benefit from the ManaFuse BoneStim technology launch and Recovery Sciences, and several key new bracing products in the coming quarters.

在第 5 張投影片的 P&R 中，我們 8% 的可比較成長反映了穩定的市場環境、嚴格的執行以及額外銷售天數的好處。總體而言，這項業務的執行符合我們的策略計劃，並將受益於 ManaFuse BoneStim 技術的推出和 Recovery Sciences，以及未來幾季的幾款關鍵的新支撐產品。

Adjusted EBITDA margins and P&R improved 50 basis points year over year as we continue to use EGX tools to drive consistent productivity improvements and proactively shape the portfolio for profitable growth. Most of our tariff exposure is in P&R, and the team are doing a fantastic job driving initiatives to minimize the net impact. Ben will share a bit more on this. I wish we didn't have to deal with this, but our EGX tools and post-COVID inflation experience have us well prepared to get through this without stalling our growth or changing the longer-term upward arc of our margins. Before I pass to Ben, I'd like to make a few personal comments.

由於我們繼續使用 EGX 工具來推動生產力的持續改進並積極塑造投資組合以實現盈利增長，調整後的 EBITDA 利潤率和 P&R 同比提高了 50 個基點。我們的大部分關稅風險都集中在稅費和折扣方面，我們的團隊正在出色地推動各項舉措，以盡量減少淨影響。Ben 將就此分享更多內容。我希望我們不必處理這個問題，但我們的 EGX 工具和 COVID 後的通膨經驗使我們做好了充分的準備來度過難關，而不會阻礙我們的成長或改變我們利潤率的長期上升趨勢。在將主題交給本之前，我想發表一些個人評論。

This is my 40th earnings call as the CEO of Colfax and now, Enovis. Across that period, our teams around the world have relentlessly worked to build a great company that creates better futures for our customers, great opportunities for our employees, and substantial value for our shareholders. I'm incredibly thankful to our team and proud of what we've achieved, and I truly appreciate the 10-year dialogue that I've had with many of you about our plans, progress, and opportunities ahead.

這是我以 Colfax 和 Enovis 執行長召開的第 40 次財報電話會議。在此期間，我們遍佈全球的團隊不懈努力，致力於打造一家偉大的公司，為我們的客戶創造更美好的未來，為我們的員工創造更大的機會，為我們的股東創造巨大的價值。我非常感謝我們的團隊，並為我們所取得的成就感到自豪，我非常感謝與你們中的許多人就我們的計劃、進展和未來機會進行的十年對話。

We have a strong foundation, an incredibly talented team, great operational and strategic momentum, and I'm passing the baton to a fantastic leader who I'm confident who will lead the company to compounding value creation in the years to come. I'm committed to making sure that this transition is smooth, even with the dynamic tariff backdrop. Now, I'll let Ben take you through the P&L details.

我們擁有堅實的基礎、一支才華橫溢的團隊、強大的營運和戰略勢頭，我將把接力棒交給一位出色的領導者，我相信他將在未來幾年帶領公司創造複合價值。我致力於確保這項過渡順利進行，即使在不斷變化的關稅背景下。現在，我請 Ben 帶您了解損益表的詳細資訊。

Thanks, Matt. Hello, everyone. I'll begin on slide 6. We are pleased to report first quarter sales of $559 million, up 8% versus the prior year and 10% on a constant currency basis. The quarter included approximately 120 basis points of negative currency headwinds and roughly 350 basis point benefit from additional selling days.

謝謝，馬特。大家好。我將從第 6 張投影片開始。我們很高興地報告第一季的銷售額為 5.59 億美元，比上年增長 8%，以固定匯率計算增長 10%。本季包括約 120 個基點的負面貨幣逆風和約 350 個基點的額外銷售日收益。

We were encouraged with the continued growth acceleration in our Recon business across anatomies as we've seen positive early results from our recent product launches. We are confident that our channel integration efforts are fully behind us as we exit the first quarter. Overall, our Recon business grew 13% with double-digit growth globally across our main segments in both hip and knee and extremities.

我們對 Recon 業務在各個解剖學領域的持續成長加速感到鼓舞，因為我們看到了最近推出的產品的正面早期成果。我們相信，隨著第一季的結束，我們的通路整合工作已全面完成。總體而言，我們的 Recon 業務成長了 13%，在髖關節、膝關節和四肢等主要領域在全球範圍內均實現了兩位數的成長。

Our growth in P&R was strong, growing at 8% mid-single digit growth when adjusted for selling days. We had positive business mix in the first quarter, leading to adjusted gross margins of 61.7%. This is an increase of 300 basis points year over year. The growth was driven by favorable segment and product mix and momentum from EGX initiatives across our manufacturing operations and supply chain. Despite ongoing investments in key R&D initiatives and medical education programs, our first quarter adjusted EBITDA grew 19%, delivering a margin of 17.7%, up 160 basis points versus the same quarter last year.

我們的 P&R 成長強勁，根據銷售天數調整後成長率達到 8% 左右。我們第一季的業務組合良好，調整後的毛利率達到 61.7%。這比去年同期增加了 300 個基點。成長的動力來自於有利的細分市場和產品組合，以及來自我們製造業務和供應鏈中 EGX 計劃的勢頭。儘管持續對關鍵研發計畫和醫學教育計畫進行投資，但我們第一季的調整後 EBITDA 仍成長了 19%，利潤率為 17.7%，比去年同期上升了 160 個基點。

First quarter effective tax rate was 23%, approximately 70 basis points higher than last year. Interest expense was $9 million for the quarter versus $20 million in 2024. Overall, we posted adjusted earnings per share of $0.81, an increase of 62% versus prior year. Turning to slide 7, I will provide updated guidance, which includes adjustments for currency movements and the current tariff situation.

第一季有效稅率為23%，較去年同期高出約70個基點。本季利息支出為 900 萬美元，而 2024 年為 2,000 萬美元。總體而言，我們的調整後每股收益為 0.81 美元，較上年增長 62%。前往第 7 張投影片，我將提供最新指南，其中包括針對貨幣變動和當前關稅狀況的調整。

For revenues, we reiterate our 2025 organic constant currency revenue growth of 6% to 6.5% year over year, which includes high-single digit growth in recon and low-single digit growth in PNR. Based on the most recent rates, primarily due to the strengthening EUR, we expect our foreign currency impact to be flat versus prior year. This compares to negative currency headwinds of 1% to 2% in our previously contemplated guidance.

對於收入，我們重申 2025 年有機固定匯率收入成長率為 6% 至 6.5%，其中包括偵察業務的高個位數成長和 PNR 的低個位數成長。根據最近的匯率，主要由於歐元走強，我們預計外匯影響將與去年持平。相較之下，我們先前預期的負面貨幣逆風為 1% 至 2%。

Because of this, we are increasing our revenue range by $30 million to $2.22 billion to $2.25 billion, which we expect to phase in equally over the quarter, the coming quarters. On margins, we are lowering our adjusted EBITDA range to $385 million to $395 million. This is a reduction of 20 million versus our prior guide and reflective of the incremental tariffs that we expect to impact profit in the second half of 2025.

因此，我們將營收範圍上調 3,000 萬美元，至 22.2 億美元至 22.5 億美元，我們預計本季和未來幾季將分階段平均上調。在利潤率方面，我們將調整後的 EBITDA 範圍下調至 3.85 億美元至 3.95 億美元。與我們先前的指引相比，這減少了 2,000 萬，反映了我們預計將影響 2025 年下半年利潤的增量關稅。

We are lowering the depreciation range by $5 million to $120 million to $125 million and also lowering our interest expense range by $4 million to $38 million to $42 million. No adjustments have been made to our tax rate or our share count outlook. Considering these changes, we are updating our adjusted earnings per share range to $2.95 to $3.10, down $0.15 from our prior guidance. Lastly, we maintain our expectation for positive free cash flow in 2025. Let's turn to slide 8, where I will provide more detailed view of the current global trade environment and the implications to our business.

我們將折舊範圍降低 500 萬美元，降至 1.2 億至 1.25 億美元，同時將利息支出範圍降低 400 萬美元，降至 3,800 萬美元至 4,200 萬美元。我們的稅率或股份數量前景沒有做出任何調整。考慮到這些變化，我們將調整後的每股盈餘範圍更新為 2.95 美元至 3.10 美元，比先前預期的下降 0.15 美元。最後，我們維持對 2025 年自由現金流為正的預期。讓我們翻到第 8 張投影片，我將更詳細地介紹當前的全球貿易環境及其對我們業務的影響。

Based on the current announced rates shown on the slide, we expect $40 million of 2025 tariff exposure that we have clear plans to mitigate to $20 million. The impacts are well over 90% in our prevention and recovery business, so we will focus our commentary there. While the majority of our trade flows into the US are from Mexico and fall within the USMCA exemption, we have several smaller portions that are subject to tariffs.

根據幻燈片上顯示的目前公佈的稅率，我們預計 2025 年的關稅風險為 4000 萬美元，我們有明確的計劃將其降低至 2000 萬美元。在我們的預防和恢復業務中，影響遠遠超過 90%，因此我們將重點關注那裡的評論。雖然我們流入美國的貿易大部分來自墨西哥，並且屬於 USMCA 豁免範圍，但仍有一小部分貿易需要支付關稅。

China is less than 10% of our P&R cost of goods, but given the very high rates in place, they represent 75% of our tariff exposure. Fortunately, these are mostly Class 1 products that are relatively easy to shift to other geographies. In fact, we've been working diligently for the last few years to build resilience in our supply chains and have active projects to shift the procurement or production of these goods to other parts of the world. We are accelerating these projects and expect to transition at least 50% of this exposure by the middle of 2026.

中國產品在我們的P&R成本中所佔比例不到10%，但考慮到現行的極高關稅稅率，它占我們關稅風險的75%。幸運的是，這些大多是第一類產品，相對容易轉移到其他地區。事實上，過去幾年我們一直在努力增強供應鏈的彈性，並積極開展專案將這些商品的採購或生產轉移到世界其他地區。我們正在加快這些專案的推進，預計到 2026 年中期將轉化至少 50% 的風險敞口。

We also see supply chain opportunities on the smaller exposures from other countries and have a great commercial and sourcing playbook that we use to recover all of the post-COVID inflation. Our plans to mitigate as much as possible of the 2025 impact are in-flight, staffed, and even if current levels continue, we expect to exit the year on a path to recover a portion of the 2025 impact in 2026. The tariff situation remains very fluid. We are monitoring the events closely and we will provide updates as appropriate as we gain further visibility into the outcomes as the situation evolves. To summarize on slide 9.

我們也看到了其他國家較小規模風險敞口中的供應鏈機會，並擁有一套出色的商業和採購策略，可用於恢復所有後疫情時代的通貨膨脹。我們計劃盡可能減輕 2025 年的影響，即使目前的水平持續下去，我們也有望在 2026 年恢復部分 2025 年的影響。關稅情況仍然非常不穩定。我們正在密切關注事態發展，隨著事態發展，我們將進一步了解結果，並適時提供最新消息。在第 9 張投影片上進行總結。

We had an encouraging start to 2025 and continue to see solid momentum to start the second quarter. We are pleased with our improving business mix and are excited about the new product innovations that should continue to ramp over the course of 2025. The underlying fundamentals of the business are strong, and we are poised to manage the business responsibly through this dynamic environment and maintain momentum towards our strategic goals.

2025 年我們有一個令人鼓舞的開端，並且在第二季開始時繼續保持強勁勢頭。我們對不斷改善的業務組合感到滿意，並對 2025 年將繼續蓬勃發展的新產品創新感到興奮。業務的基本面強勁，我們準備在這種動態環境中負責任地管理業務，並保持實現策略目標的勢頭。

Great. Thanks, Ben. Before we begin the Q&A session, in an effort to accommodate everyone on the call, we ask the analysts to keep the questions to one question and one follow-up. You are welcome to rejoin the queue if we have time. Operator, please start the Q&A.

偉大的。謝謝，本。在我們開始問答環節之前，為了方便電話會議中的每個人，我們要求分析師將問題限制為一個問題和一個後續問題。如果我們有時間，歡迎您重新加入隊列。接線員，請開始問答。

(Operator Instructions)

（操作員指示）

Vik Chopra, Wells Fargo.

喬普拉（Vik Chopra），富國銀行。

Hey, good morning, and congrats on a nice start to the year. Two questions to me. The first one, Matt or Ben, I guess you've laid out a number of mitigating actions in the slide deck. I'm just curious which of these you view as having the most significant potential to create durable supply availability over the long term, then I had a quick follow up, please.

嘿，早安，恭喜你今年有個美好的開始。我有兩個問題。第一個，馬特或本，我想你們已經在幻燈片中列出了一些緩解措施。我只是好奇，您認為哪一個最有可能在長期內創造持久的供應可用性，然後我請快速跟進。

Yeah, thanks a lot, Vik. Yeah, as Ben mentioned, I think that the best opportunity we have is quickly moving the sourcing of products out of China. That's where most of our tariff exposure is coming from. We've already been working on that and brought it down over the past 12 months and so we feel comfortable there's a number of other countries. In some cases, the same suppliers can move the product to another country. In some cases, we have to resource and by working aggressively on those, we can move the number down that makes the amount that we need to work on other mechanisms, like commercial actions and things, that becomes a smaller number and so that's the sustainable way through this.

是的，非常感謝，維克。是的，正如本所提到的，我認為我們最好的機會是迅速將產品採購轉移出中國。我們的關稅風險大部分來自於此。我們已經在努力解決這個問題，並在過去 12 個月內將其降低，因此我們對其他一些國家也採取同樣的措施感到放心。在某些情況下，同一供應商可以將產品運送到另一個國家。在某些情況下，我們必須投入資源，透過積極開展工作，我們可以減少這個數字，從而減少我們需要在其他機制（如商業行動等）上投入的資金，這是實現這一目標的可持續方式。

Okay, got it. That's super helpful. Just one more question for me, in the deck that 12% plus extremities growth in Q1. We just love to hear what you're seeing with the ARG launch and maybe just talk about general trends in the market overall. Thank you.

好的，明白了。這非常有幫助。我還有一個問題，第一季極端成長率超過 12%。我們很想聽聽您對 ARG 發布的看法，或許還能談談整個市場的整體趨勢。謝謝。

Yeah, of course, ARG launch is going terrifically. Like any launch, we're taking it step by step and we're just a handful of months into it, but it's going terrifically and you've seen even in Q4 and then here in Q1, you can see the impact there on our extremities growth and our shoulder growth is now comfortably back above the market as we continue to have the great ultimate product and now the ARG that we're bringing with that. So. That's going very well.

是的，當然，ARG 的發布進展順利。就像任何產品發布一樣，我們一步一步地進行，雖然才幾個月的時間，但進展非常順利，您甚至已經看到在第四季度和第一季度，您可以看到它對我們的四肢增長的影響，而我們的肩部增長現在已經輕鬆回到市場之上，因為我們繼續擁有出色的終極產品以及隨之而來的 ARG。所以。一切進展順利。

As far as your com, your question about markets more broadly, it was a good healthy start to the year. We talked about there was a good finish to last year. This year started out strong, actually January and February were really healthy, March was a month that had a few more sort of vacations and shows and things and so, was not as, I would say not as hot as January and February, but the quarter as a whole was a good solid start to the year and we're seeing a good healthy April. And so, in the US, we're expecting at least a normal year of growth here in the US. And outside the US, a good healthy start too.

就您的問題以及關於更廣泛的市場而言，今年的開局良好。我們談到去年有一個美好的結局。今年開局強勁，實際上 1 月和 2 月的業績非常健康，3 月則有更多假期和演出等活動，因此，我認為不如 1 月和 2 月那麼熱，但整個季度為今年開了個好頭，4 月的業績也表現良好。因此，我們預計美國至少將迎來正常的一年成長。在美國以外，這也是一個好健康的開始。

Vijay Kumar, Evercore ISI.

維傑·庫馬爾（Vijay Kumar），Evercore ISI。

Hey, guys. Thanks for taking my question and wishing you the best as your transition year. Maybe one on the US performance here, bracing came in pretty strong, 10%. That's well above the normalized trends. And when I look at the US large joint performance X days is perhaps, 7%, 8%-ish. Was that in line with your expectations, maybe just talk about the US performance, bracing better with Recon in line or perhaps any timing element out there.

嘿，大家好。感謝您回答我的問題，並祝您在過渡之年一切順利。也許就美國的表現而言，支撐作用相當強勁，達到 10%。這遠高於正常趨勢。當我查看美國大型聯合公司的表現時，X 天大概是 7%、8% 左右。這是否符合您的預期，也許只是談論美國的表現，更好地與偵察兵保持一致，或者可能是任何時間因素。

Yeah, I'd say, Vijay, thanks for the comments. Certainly, a healthy start in the US market in bracing and so we were happy with that. I think that was consistent with what I commented about the strong market environment that we saw in January and February. Often that flows over and helps pricing as well. So we feel good about that start.

是的，我想說，維傑，謝謝你的評論。當然，美國支撐市場開局良好，我們對此感到高興。我認為這與我對一月和二月強勁的市場環境的評論一致。通常，這也會對定價產生影響。所以我們對這個開始感到很滿意。

The team did some great work last year driving clinic conversions that are helping get getting off to a great start this year as well. And there's some great NPI in that business, as we said on the slide, our spine products that we've been building out there grew double digits in the quarter. So some good things going on there. We're happy with that.

該團隊去年在推動診所轉型方面做了一些出色的工作，這也有助於今年有一個好的開始。正如我們在幻燈片中所說，該業務中有一些很棒的新產品導入 (NPI)，我們在那裡開發的脊椎產品在本季度實現了兩位數的成長。所以那裡發生了一些好事。我們對此感到高興。

On the Recon side, our start -- our Q1 was fully in line with the expectations that we had. We've been talking consistently about quarter-by-quarter progression in that business, and what we saw was consistent with that. Certainly, January and February suggested that it might have been even better, but then, March kind of took back a little bit of that. But when you step back on the whole quarter, we feel like it was a good strong quarter for our US surgical business.

在偵察方面，我們的開始——我們的第一季完全符合我們的預期。我們一直在談論該業務逐季度的進展，我們所看到的情況也與此一致。當然，一月和二月的情況可能會更好，但三月的情況卻有所回落。但回顧整個季度，我們感覺這對我們的美國外科手術業務來說是一個強勁的季度。

And we're early days on the ARG launch. We just got our hip products into the market. We've got a number of enabling tech products that we got in in Q1 and that are coming later in the year. So there's plenty of reasons to believe that we can sustain and build on that US surgical performance.

我們正處於 ARG 發布的早期階段。我們剛剛將我們的時尚產品推向市場。我們在第一季推出了一些支援性技術產品，這些產品將於今年稍後推出。因此，我們有充分的理由相信，我們能夠維持並鞏固美國的外科手術水準。

Understood. Maybe, Ben, one for you on gross margins. Rally strong Q1, you were up sequentially, any wine climbers here in -- on the gross margins or is this a sustainable number?

明白了。也許，本，我可以跟你講一下毛利率。第一季強勁反彈，您的銷售額連續上漲，這裡有任何葡萄酒銷售額攀升 - 毛利率或這是一個可持續的數字嗎？

Yeah, Vijay, I think it's very much a positive business mix that we're getting in both sides of the business. I think the new products that Matt outlined are really contributing well and same on having really strong extremities recovery on the Recon side, seeing the benefits of the higher gross margins there. Definitely feel like we've continued to mix and shape the company towards higher gross margin performance year after year and other than the fact that we'll have some headwinds in the second half of the year with the tariffs as I outlined on the call. But overall, I think underlying performance and gross margin is positive, and I would expect that to continue.

是的，維傑，我認為我們在業務的兩個方面都取得了非常積極的業務組合。我認為 Matt 概述的新產品確實做出了很好的貢獻，並且在 Recon 方面擁有非常強大的四肢恢復能力，看到了更高毛利率的好處。我確實感覺到，我們一直在持續調整和塑造公司，以便逐年提高毛利率，但正如我在電話會議上提到的，下半年我們會面臨關稅方面的一些阻力。但總體而言，我認為基本業績和毛利率是正面的，而且我預計這種情況會持續下去。

Robbie Marcus, JP Morgan.

摩根大通的羅比·馬庫斯。

Great, good morning and thanks for taking the questions. Two for me. First, I wanted to ask on second quarter. It looks like the first quarter was pretty much right in line with the street on an organic basis. How should we be thinking about the seasonally stronger second quarter within the guidance just given the integration last year made for some funky comps, then I have a follow up. Thanks.

太好了，早安，謝謝您回答問題。對我來說是兩個。首先，我想問一下第二季的情況。看起來，第一季的有機成長與華爾街基本一致。鑑於去年的整合為一些有趣的比較帶來了影響，我們應該如何看待在指導範圍內季節性更強勁的第二季度，然後我有一個後續問題。謝謝。

Yeah, I think -- thanks, Robbie. I think from our view, given that we had some tailwind from days in the first quarter, you'll see a slightly different pattern from in terms of how the seasonal performance works quarter over quarter. So again, it's very much in line with what we had outlined in our prior call with regards to our first half, second half splits in terms of our view on how we would expect the revenue to play out, and nothing's changed with regards to our outlook there. So I think you have the information you need to kind of think how we're thinking about the second quarter.

是的，我想──謝謝，羅比。我認為，從我們的角度來看，考慮到我們在第一季獲得了一些順風，你會看到與季度間季節性表現略有不同的模式。因此，這與我們在先前的電話會議中概述的關於上半年和下半年收入分配情況的預測非常一致，而且我們的前景沒有任何改變。所以我認為您已經掌握了所需的信息，可以了解我們如何看待第二季。

Great. Maybe on cash flow and financing, I -- you're still calling for positive free cash flow. It was decently negative in the first quarter, and it looks like you hit the revolver for $70 million. Just maybe speak to the confidence and the progression of free cash flow through the year and where you expect to end the year on leverage. Thanks a lot.

偉大的。也許在現金流和融資方面，我——你仍然呼籲正的自由現金流。第一季的業績相當糟糕，看起來你損失了 7,000 萬美元。也許只是談談對全年自由現金流的信心和進展，以及您預計今年年底的槓桿率是多少。多謝。

Yeah, seasonally, first quarter is always our lowest as we pay out bonuses and things like that in the first quarter. So we're slightly ahead of our operating plans in terms of cash flow in the first quarter, and we see clear signs for us to continue to drive improvements over the course of the balance of the year. So still very confident in the guidance that we've put out there and feel like we continue to take ground on getting up the cash flow conversion curve that we've laid out very much a step forward this year as we see some reduction in some of the integration cost. And this is the last year where we're still spending a little bit more heavily on the EUMDR, so there's a clear line of sight to continued improved free cash flow for the company, and I would expect that to continue as we move into the second quarter and the balance of the year. Obviously, we've got some challenges with the tariffs coming our way, so that'll put a little bit of a headwind in terms of our overarching operating plans that we had to start the year. But as we said, we're going to mitigate as much as we can and still be in a position where we can deliver positive cash flow in the year.

是的，從季節性來看，第一季總是我們的最低谷，因為我們在第一季支付獎金和類似的東西。因此，就第一季的現金流而言，我們略微超出了我們的營運計劃，並且我們看到了明顯的跡象，表明我們將在今年餘下的時間裡繼續推動改善。因此，我們對已經發布的指導仍然非常有信心，並且感覺我們將繼續在提高我們今年制定的現金流轉換曲線方面取得進展，因為我們看到部分整合成本有所減少，所以今年我們向前邁出了一大步。這是我們在 EUMDR 上投入更多資金的最後一年，因此，公司自由現金流的持續改善是顯而易見的，我預計，隨著我們進入第二季度以及今年餘下的時間，這種趨勢將持續下去。顯然，我們面臨著關稅方面的一些挑戰，這將對我們年初制定的整體營運計劃造成一些阻力。但正如我們所說，我們將盡可能減輕影響，同時仍能在今年實現正現金流。

And the year end leverage, where should we expect that to settle out?

那麼，我們預期年底的槓桿率將會穩定在多少呢？

Yeah, I think we're still in the operating view that we'll be in the 3 to 3.5 range in terms of leverage as we exit the year.

是的，我認為我們仍然認為，到今年年底，槓桿率將處於 3 到 3.5 的範圍內。

Caitlin Cronin, Canaccord Genuity.

凱特琳‧克羅寧 (Caitlin Cronin)，Canaccord Genuity。

Hey guys. It's the (inaudible) for Caitlin. Thanks for taking the questions. Our first one, can you provide an update on the ARVIS shoulder launch, how it's progressing so far, when you expect a broader roll out, and are you still expecting an OUS launch of the ARVIS tech this year?

嘿，大家好。這是凱特琳的（聽不清楚）。感謝您回答這些問題。我們的第一個問題，您能否提供關於 ARVIS 肩部推出的最新信息，到目前為止進展如何，您預計何時會進行更廣泛的推廣，您是否仍預計今年會在 OUS 推出 ARVIS 技術？

Yeah, thanks for the question. The ARVIS shoulder launch is going really well. We -- we've specifically only put it in a certain number of surgeons' hands to make sure that we get some great feedback and sort of control the rate of the launch. But the response from the surgeons that have gotten a chance to use it has been extremely positive and I would say the other effect that we probably underestimated is as we bring ARVIS to local events around the country, we are finding that the amount of surgeons that want to come out to the local event and learn about allate so that they can see ARVIS is significant. So we're excited about the response to the product, as well as just the buzz and energy it's creating around our shoulder business as a whole and the growth acceleration there and so feeling very good about that.

是的，謝謝你的提問。ARVIS 肩部發射進展非常順利。我們——我們特意只把它交給一定數量的外科醫生，以確保我們得到一些很好的回饋，並控制發射速度。但是，有機會使用它的外科醫生的反應非常積極，我想說，我們可能低估的另一個影響是，當我們將 ARVIS 帶到全國各地的當地活動中時，我們發現想要參加當地活動並了解 allate 以便能夠看到 ARVIS 的外科醫生數量非常多。因此，我們對該產品的反響以及它在我們的整個肩部業務中產生的轟動和活力以及那裡的增長加速感到非常興奮，因此對此感覺非常好。

Awesome, thanks. And just one more, can you speak a little bit to the cadence of other new product launches plans for this year and if it's still -- if they're whether they're still aligned with your original expectations.

太棒了，謝謝。還有一個問題，您能否談談今年其他新產品發布計劃的節奏，以及它們是否仍然符合您最初的預期。

Yeah, new product launches broadly, not just enabling tech?

是的，新產品的推出範圍很廣，而不僅僅是技術層面？

Yeah.

是的。

Yeah. So we've got a great lineup of new product launches. Some of them launched late last year and are now just building this year and we've got others coming through this year. On the Recon side, we -- I didn't mention in my comments, but we're still making hay with our knee revision products, right? We brought some great products out now a year or so ago but then added the Lima products and we've now got the in terms of the revision and the cones that we've got between what we launched and what came with Lima. We've really got this -- the best revision, sort of cones solution out there, we think. And so, we're really happy with the momentum and revision in me from those launches from a little while back.

是的。因此，我們推出了一系列出色的新產品。其中一些項目於去年年底啟動，目前正處於建設階段，其他一些項目也將於今年啟動。在 Recon 方面，我在我的評論中沒有提到，但我們仍在利用我們的膝關節修復產品大展拳腳，對嗎？大約一年前，我們推出了一些很棒的產品，但後來又增加了 Lima 產品，現在我們在修訂版和錐體方面已經達到了我們推出的產品和 Lima 產品之間的水平。我們認為，我們確實已經找到了最佳的修訂版，即錐體解決方案。因此，我們對不久前發布的這些產品所展現出的勢頭和改進感到非常高興。

We've got the ARG from late last year that is ramping quarter by quarter here and really a real positive in shoulder, and then we just got into the market at the end of the quarter our colored stem, the nebula hip and the hip impactor to go with that. And again, that's in a controlled launch now, so it's going to be kind of quarter by quarter in terms of how that ramps.

從去年年底開始，我們就有了 ARG，它的銷量逐季增加，對肩部來說確實是一個積極的信號，然後我們在本季度末將彩色柄、星雲髖關節和髖關節撞擊器引入市場。再說一次，現在正處於受控啟動階段，因此就其如何成長而言，將會以逐季度的方式進行。

But so for each anatomy, something really good to be run with and then the enabling tech, the guidance products, or the guidance technologies and enable tech of ARVIS as well as have 360 and the -- and gap balancing for both of those products this year as well. So on the Recon side, a lot of great things going on, and on the P&R side, some great things in terms of spine braces, Roam OA a still ramping, and the ManaFuse product that's given us great runway in our recovery sciences bone stem business.

但對於每個解剖結構來說，都需要運行一些非常好的東西，然後是支援技術、引導產品，或者引導技術和 ARVIS 的支援技術，以及 360 和——今年也要平衡這兩種產品的差距。因此，在 Recon 方面，有很多很棒的事情正在發生；在 P&R 方面，在脊椎支架方面也有一些很棒的事情，Roam OA 仍在不斷發展，而 ManaFuse 產品為我們的恢復科學骨幹業務提供了良好的發展基礎。

Dane Reinhardt, Baird.

丹恩·萊因哈特，貝爾德。

Hey, good morning, guys. So thanks for taking the questions here. I just wanted to maybe double click on kind of following up on Robbie's question regarding cash flow. First, can you just remind us how you're thinking about CapEx this year? And I know the size of the company's kind of grown 50% just since the Mathis and Lima deals over the past few years, but CapEx is also up almost 3 times that amount or 3 times the amount it was a few years ago. So wondering kind of what you're thinking about CapEx levels over the next few years and then I know your free cash flow goal or conversion, I think it's 70% to 80% over the long term. Can you just kind of remind us, do you have a timeline around that target?

嘿，大家早安。感謝您在這裡回答問題。我只是想雙擊以跟進 Robbie 關於現金流的問題。首先，您能否提醒我們一下您對今年的資本支出有何看法？我知道，自從過去幾年 Mathis 和 Lima 交易以來，公司的規模已經增加了 50%，但資本支出也幾乎增加了 3 倍，或者說是幾年前的 3 倍。所以想知道您對未來幾年的資本支出水準有何看法，然後我知道您的自由現金流目標或轉換率，我認為從長遠來看是 70％ 到 80％。您能否提醒我們一下，您對該目標有時間表嗎？

Yeah. Thanks, Dane, for the question. So yeah, I think as the businesses continue to evolve and we've brought in Lima and as we've continued to scale the foot and ankle business and as we're investing for growth, we've been putting in the necessary instrumentation to support that growth, which creates some little bit of elevated CapEx just as we're getting started in terms of driving some of the opportunities there to grow above the market.

是的。謝謝 Dane 提出的問題。所以是的，我認為隨著業務的不斷發展，我們引入了 Lima，隨著我們繼續擴大足踝業務，隨著我們為增長而進行投資，我們一直在投入必要的工具來支持這種增長，這在我們開始推動一些超越市場的增長機會時，創造了一些資本支出的增長。

Second thing that's happening in CapEx is that we continue to invest to expand facilities and to get after some of the integration synergies that we'd identified as part of the Lima deal. So we're in a little bit an elevated phase of operational CapEx right now as we are putting in place the equipment that's necessary to get after some of the next phase of our synergies that will return to the bottom line.

資本支出方面發生的第二件事是，我們繼續投資擴大設施，並實現我們在利馬交易中確定的一些整合協同效應。因此，我們目前正處於營運資本支出略高的階段，因為我們正在安裝必要的設備，以實現下一階段的協同效應，從而回到底線。

So overall, we feel like we're in probably the next one to two year of a little bit of elevated CapEx spend on the operational side, but that will get more efficient as we clear 2026. Same as as we get the growth investments put out there, you'll see some efficiency in CapEx over time. It won't be overnight, but it will be, I'd say, steady over the course of the next several years.

因此總體而言，我們覺得未來一到兩年內，我們在營運方面的資本支出可能會略有增加，但到 2026 年，這筆支出將會變得更有效率。與我們投入的成長投資一樣，隨著時間的推移，您會看到資本支出的效率。這不會是一朝一夕的事，但我想說，在未來幾年內，它將會穩定下來。

So as we look at the integration spend levels, those will step down significantly as we look at our European medical device regulation spend, this is the last heavy year of spend there. And as we normalize some of the CapEx spend, our entitlement of where our free cash flow is is already getting closer to that number that you described. And then as we drive more efficiency in the supply chain and as we continue to to leverage the business and scale it, we'll get to the next, step up to get into that 70% to 80% range as a company.

因此，當我們查看整合支出水準時，這些水準將大幅下降，而當我們查看歐洲醫療器材監管支出時，這是那裡支出最大的最後一年。隨著我們將部分資本支出正常化，我們應得的自由現金流已經越來越接近您所描述的數字。然後，隨著我們提高供應鏈效率，隨著我們繼續利用業務並擴大規模，我們將進入下一步，將公司比例提高到 70％ 到 80％。

And it's even potentially get better than that over time, I think. But our view is that we're going to continue to invest in the growth of business, we're going to continue to be disciplined in terms of how we continue to drive profitable growth and let that growth scale into our cash flows. And overall, we feel very much over the next few years, that we'll be in that range of of the targets that we've laid out and then giving ourselves the opportunity to reinvest in the business and look at a continued M&A agenda to strengthen and shape the company towards our strategic goals.

我認為，隨著時間的推移，情況甚至可能會變得更好。但我們的觀點是，我們將繼續投資於業務成長，我們將繼續嚴格遵守如何繼續推動獲利成長並將這種成長轉化為現金流的規定。總體而言，我們堅信，在未來幾年內，我們將實現既定目標，並有機會對業務進行再投資，並考慮持續的併購議程，以加強公司實力並塑造公司，使其朝著戰略目標邁進。

Okay, thank you for that. Appreciate it. And then just my follow up, I think in past quarters, you've maybe broken out the growth in extremities between shoulder and foot and ankle, and I think for a few quarters last year, foot and ankle was kind of leading that. Just wondering if you could provide an update there kind of between those two subsegments and extremities. Thanks.

好的，謝謝你。非常感謝。然後我的後續問題是，我認為在過去的幾個季度中，你可能已經細分了肩部、足部和腳踝之間的四肢增長情況，我認為去年的幾個季度中，足部和腳踝處於領先地位。只是想知道您是否可以提供關於這兩個子段和極端之間的更新資訊。謝謝。

Yeah. So in the first quarter, definitely our shoulder business drove the extremities growth, and we're returned to a nice, healthy above market there. We feel like our foot and ankle business was above the market growth, but we do think the first quarter in foot and ankle was a little slower market growth than usual. And so shoulder drove, foot and ankle still above market, and we still feel comfortable that the combination of those can grow well above market and be a double-digit piece of the overall recon equation.

是的。因此，在第一季度，我們的肩部業務無疑推動了四肢業務的成長，並且我們恢復到了良好、健康的市場水平。我們覺得我們的足踝業務高於市場成長，但我們確實認為第一季足踝市場的成長比平常慢一些。因此，肩部、腳部和腳踝的驅動力仍然高於市場，我們仍然感到自信，這些因素的組合可以遠高於市場，並成為整體偵察方程式的兩位數部分。

Danielle Antalffy, UBS.

瑞銀的丹妮爾·安塔爾菲 (Danielle Antalffy)。

Thank you so much and congrats on a great start to the year. Just a quick question for you on the broader macroeconomic environment if I could. I appreciate all the commentary on tariffs, but one of the questions is do we don't we go into a recession? I'm certainly no economist, so I can't opine, but just curious if you could lay out how recession proof or not you think the business is, and then I just have one quick follow up.

非常感謝您，並祝賀您今年有一個良好的開端。如果可以的話，我只想問您一個關於更廣泛的宏觀經濟環境的簡單問題。我感謝所有關於關稅的評論，但問題之一是我們是否會陷入經濟衰退？我當然不是經濟學家，所以我無法發表意見，但我只是好奇您是否可以說明一下您認為該業務對經濟衰退的抵禦能力如何，然後我只想快速跟進一下。

Yeah, thanks for the question, Danielle. One of the really great things about the businesses we're in and the markets that we serve is that they have consistent long-term growth and typically have had limited impacts even in significant recessionary period. I think if you go to some of the worst recessionary periods, maybe the markets we serve kind of went flat, and that's something we've studied quite a bit. And so, we feel like our markets are -- should remain healthy. Sure, if there's a recession, there could be some modest impact from some of the discretionary decisions that are made, but we would think that in a recessionary period, our markets will perform substantially better than many other markets.

是的，謝謝你的提問，丹妮爾。我們所從事的業務和服務的市場的一個真正優點是，它們具有持續的長期成長，並且即使在嚴重的經濟衰退時期也通常影響有限。我認為，如果你經歷過一些最嚴重的經濟衰退時期，我們所服務的市場可能會變得平穩，這是我們進行過大量研究的事情。因此，我們覺得我們的市場應該保持健康。當然，如果出現經濟衰退，一些自由裁量的決定可能會產生一定的影響，但我們認為，在經濟衰退時期，我們的市場表現將遠遠好於許多其他市場。

Got you. Okay, that's helpful. And then you guys have laid out margin expansion goals annually in the past and I'm just curious if the tariff dynamic changes any of that or if we can still think about 50 basis points per year is sort of the underlying goal here. Thanks so much.

明白了。好的，這很有幫助。然後，你們過去每年都設定了利潤率擴張目標，我只是好奇關稅動態是否會改變這些目標，或者我們仍然可以認為每年 50 個基點是這裡的潛在目標。非常感謝。

Yeah, I think -- thanks for the question, Danielle. We are very much still committed to driving that profitable growth and margin expansion. I mean, obviously the guidance that we updated today would put a little bit of a I'd say delay in our approach versus where we expected this year to play out in terms of those goals, but as I mentioned in my commentary, we feel this will be more of a one-time thing that we will lap pretty quickly here and get back to momentum as we get into 2026.

是的，我想──謝謝你的提問，丹妮爾。我們仍然致力於推動獲利成長和利潤率擴大。我的意思是，顯然我們今天更新的指導會讓我們的方法與我們預期今年實現的目標相比有所延遲，但正如我在評論中提到的那樣，我們認為這將是一次性的事情，我們將在這裡很快完成並在進入 2026 年時恢復勢頭。

So overall, fundamentally, the business is set up to drive that profitable growth where we're getting the mix of the business continued scale from some of the recent acquisitions and further synergies from the Lima acquisition that we did. All of that will contribute to good, strong, profitable growth. We see both opportunities in each segment to drive both gross margin and leverage improvement in each of the business segments. So we're still very bullish in terms of our ability to drive a good, strong, profitable growth. Now, obviously, 2025, depending on how the tariff situation plays out, might put a little bit of implication on what we can do in year this year. But again, like I said, we'll quickly get back to driving margin improvements as we get into 2026.

因此，總體而言，從根本上來說，業務的設立是為了推動獲利成長，我們透過最近的一些收購來獲得業務的持續規模，並透過我們進行的利馬收購獲得進一步的協同效應。所有這些都將有助於實現良好、強勁、有利可圖的成長。我們在每個部門都看到了推動每個業務部門毛利率和槓桿率提高的機會。因此，我們對於推動良好、強勁、獲利成長的能力仍然非常樂觀。現在，顯然，2025 年的關稅情況可能會對我們今年能做的事情產生一些影響。但正如我所說，進入 2026 年，我們將迅速恢復推動利潤率提高的勢頭。

Mike Matson, Needham.

麥克馬森，尼德姆。

Hi, guys. This is Joseph on for Mike today. Maybe just to start it off, gross margin, saw some great improvement there. Could you maybe give us some color about maybe why more of that improvement didn't flow through to the EBITDA margin.

嗨，大家好。今天由約瑟夫代替麥克表演。也許剛開始的時候，毛利率就出現了很大的改善。您能否向我們解釋為什麼更多的改進沒有轉化為 EBITDA 利潤率？

Yeah, I'd say, again, as we are investing in the business for growth, some of the phasing of our operating expense spend, especially as we get off to a strong start with some of the conferences that we attend and some of the medical education events that we invest in, as well as I think we've described a lot of the new products that we're launching which requires some investments as we're really launching those products. So overall, we continue to invest in the business, to make sure we're creating sustainable growth, momentum. And the increases in gross margin are really helping us make those investments while still delivering good strong profit expansion at the same time. So that's the formula that worked in Q1, and overall, I think we've set the business up to continue to be in that kind of momentum.

是的，我想說，由於我們正在投資業務成長，我們的一些營運費用支出正在分階段進行，特別是當我們透過參加的一些會議和我們投資的一些醫學教育活動取得了良好的開端時，我認為我們已經描述了許多即將推出的新產品，這些產品需要一些投資，因為我們真的在推出這些產品。總體而言，我們將繼續對業務進行投資，以確保創造可持續的成長動力。毛利率的提高確實幫助我們進行了這些投資，同時仍實現了強勁的利潤成長。這就是第一季奏效的公式，總的來說，我認為我們已經為業務做好了準備，並將繼續保持這種勢頭。

Okay, great. And then maybe just one of the ManaFuse launch, just wondering if you could maybe talk a little bit more about the product and the opportunity here. I mean, should we be thinking about this more as of product cycle upgrade or are there any features on ManaFuse that are very differentiated from either your legacy, bones and products or maybe competitors? And then, just an add on to that. Have you guys heard anything about potentially reclassifying these devices? Is there any risk to that? I don't think we've heard much about that, you know, that was discussed more in 2020.

好的，太好了。然後也許只是 ManaFuse 發布的其中一項，只是想知道您是否可以再多談一下有關產品和這裡的機會。我的意思是，我們是否應該在產品週期升級時更多地考慮這一點，或者 ManaFuse 上是否有任何功能與您的傳統產品、骨架和產品或競爭對手有很大不同？然後，再對此進行補充。你們聽過可能對這些設備進行重新分類的事情嗎？這有風險嗎？我認為我們對此了解不多，你知道，這個問題在 2020 年討論得更多。

Yeah, no, thanks for the question. No, ManaFuse expands the market and will accelerate the growth of our business there. So we serve the spine market with our bone stem, and then we also serve the fracture market as a smaller part of that of that business. And there's still plenty of healthy growth with the traditional technology that we've had in the spine market, as well as in fresh fracture in the fracture market, but there's also an opportunity that is -- has been emerging with lipos ultrasound technology to drive further into the fracture market.

是的，不，謝謝你的提問。不，ManaFuse 擴大了市場並將加速我們在那裡的業務成長。因此，我們利用骨幹服務於脊椎市場，然後我們也服務於骨折市場，這是該業務的一小部分。我們在脊椎市場以及骨折市場的新鮮骨折方面所採用的傳統技術仍然有很大的成長空間，但同時也存在著一個機會——隨著脂肪超音波技術的出現，可以進一步推動骨折市場的進一步發展。

And the fracture market has the potential to be as larger and larger than the spine market. It's just that it's many indications versus spine is less, is just a few. And so, we're really excited that the ManaFuse product gives us the opportunity to within the same channel to get at additional market. in some cases, additional opportunity with the same customers, and in some cases, drive to new customers and it really takes a business that has had a maybe more low-single digit market growth rate, and moves the market growth rate opportunity for that business above that, and it makes our opportunity in our business to be at least mid-single and an opportunity to drive more high-single digit growth within that business, within P&R and it's a very high gross margin business with great profitability.

骨折市場有潛力比脊椎市場越來越大。只是它的適應症很多相對於脊椎來說比較少，只是少數。因此，我們非常高興 ManaFuse 產品讓我們有機會在同一通路內開拓更多市場。在某些情況下，可以為同一客戶提供更多機會，而在某些情況下，可以吸引新客戶，這確實需要一家市場增長率可能更低的企業，並將該企業的市場增長率機會提升到更高水平，這使我們業務中的機會至少達到中等個位數，並有機會在該業務、在損益表中推動更高個位數的增長，這是一項毛利率非常高、盈利能力極強的業務。

As far as the reclass, there is no meaningful discussion going on about reclassifying. And, I would also say that we believe that if any reclassification did take place, it would actually have the potential to meaningfully accelerate the rate of growth in the business because of the innovation that it would open up and the opportunity to get more market access. And so, while we do not see any reclass on the horizon, we actually believe there's as much opportunity that that could be a good thing as a bad thing if it were to happen.

就重新分類而言，目前還沒有關於重新分類的有意義的討論。而且，我還想說，我們相信，如果確實進行了重新分類，它實際上有可能顯著加快業務的成長率，因為它將開啟創新並帶來獲得更多市場准入的機會。因此，儘管我們看不到任何重新分類的跡象，但我們實際上相信，如果發生這種情況，既可能是一件好事，也可能是一件壞事。

(Operator Instructions)

（操作員指示）

Russell Yen, William Blair.

羅素顏、威廉布萊爾。

Hey, guys. This is Russell on for Brandon Vasquez. I have two for me starting at a more higher level. Could you guys talk about what you're seeing in regards to the pricing environment and whether there's any potential for price given any potential like inflation or tariffs headwinds?

嘿，大家好。這是拉塞爾替換布蘭登·巴斯克斯。我有兩個從更高層次開始的。你們能否談談對定價環境的看法，以及在通貨膨脹或關稅逆風等潛在因素的影響下，價格是否還有上漲的潛力？

Yeah, sure. So on the PNR side, we've talked for a while about a sort of a flatter price environment that emerged after some of the upward pricing from post-COVID, and we're still in sort of a flattish price environment in P&R, but certainly with various sources of inflation starting to flow through there again and so we're going to be kind of looking carefully at that.

是的，當然。因此，在 PNR 方面，我們已經討論了一段時間關於在 COVID 之後價格上漲之後出現的一種較為平緩的價格環境，而我們在 P&R 方面仍然處於一種較為平緩的價格環境中，但可以肯定的是，各種通膨來源又開始流經那裡，因此我們將仔細研究這一點。

As far as a Recon, after a kind of a more stable price environment, there is now a little bit of downward trend in the Recon price environment. There's a nice offset there that a lot of the new products are mix enriching, and so the net effect is pretty decent there. But definitely, we've seen the recon market move into a little bit more of a downward price environment now, but it certainly remains to be seen with questions about tariffs and inflation and things as to whether that that might shift as we work through this year.

就 Recon 而言，在經歷了更穩定的價格環境之後，現在 Recon 價格環境出現了一點下降趨勢。這是一個很好的補償，很多新產品的組合都很豐富，所以淨效應相當不錯。但毫無疑問，我們已經看到偵察市場現在進入了稍微向下的價格環境，但關於關稅和通貨膨脹的問題以及這些情況是否在今年內發生變化的問題仍有待觀察。

Great, thanks. And then secondly, on the Recon side, internationally, you guys grew pretty well more specifically with like cross selling. Could you guys talk about more on the durability of that and where you're seeing the pockets of strength?

太好了，謝謝。其次，在 Recon 方面，在國際上，你們的發展相當不錯，尤其是透過交叉銷售。你們能否進一步談談它的耐用性以及你們認為其優勢在哪裡？

Yeah, our international, Martin, team has done terrifically really. If you look at -- we brought those teams together early last year, lots of work to put the channel together, to put the full offering together, et cetera. And just tremendous growth all through last year, now a tremendous start to this year, on top of a strong first quarter last year, so really pleased to see that.

是的，我們的國際團隊馬丁確實表現得非常出色。如果你看一下——我們在去年年初將這些團隊聚集在一起，做了很多工作來整合管道，整合完整的產品等等。去年全年都實現了巨大的成長，今年又迎來了良好的開端，再加上去年第一季的強勁表現，我真的很高興看到這一點。

Certainly, the markets out there had a good, healthy start, but our growth is definitely above those markets, and I think that's a tribute to the strength of our commercial channel out there we've -- that we've assembled the strength of the full product line that we've got, the ability that it gives us country by country to focus on the products that can be grown the most. And so, we're actually in the early days on cross-selling and still growing at the growth rates that we are.

當然，這些市場開局良好、健康，但我們的成長速度絕對高於這些市場，我認為這是對我們商業通路實力的肯定——我們整合了我們擁有的全系列產品的優勢，這讓我們能夠針對各個國家，專注於最具增長潛力的產品。因此，我們實際上還處於交叉銷售的早期階段，並且仍然以現有的成長率成長。

Now, as far as your question about durability, I think that as the -- practically speaking, probably those markets are a little stronger than they might be over time. And as the markets continue to normalize, we are going to be driving more cross selling and expand our delta to the markets, and we certainly believe that international can play the role they need to play in our overall Recon strategic growth.

現在，就您關於耐用性的問題而言，我認為——實際上，這些市場可能比它們可能隨著時間的推移而變得更加強勁。隨著市場繼續正常化，我們將推動更多的交叉銷售並擴大我們的市場影響力，我們堅信國際市場可以在我們的整體 Recon 策略成長中發揮其應有的作用。

Young li, Jefferies.

楊李，杰弗里斯。

Right, great. Thanks for taking our questions. Matt, it was great working with you over the past three years and good to see that you're leaving the company at a strong position and the smooth leadership transition. First question on PNR, pretty good start to the year, above guidance performance, you talked about some of the new products driving that. I think the outlook for the year still assumes low-single digit growth, so just kind of curious, the comps get easier through the year, why sort of the detail for that business?

對，太好了。感謝您回答我們的問題。馬特，過去三年和你共事非常愉快，很高興看到你在公司處於強勢地位時離開，並且領導層的過渡也很順利。關於 PNR 的第一個問題，今年開局相當不錯，業績超出預期，您談到了一些推動這一趨勢的新產品。我認為今年的前景仍然假設低個位數成長，所以有點好奇，全年的比較會變得更容易，為什麼要對該業務進行這樣的詳細分析？

Yeah, thanks. Well, first, thanks for your comments, and I really -- I do believe, as you said, that the company is very strong and has great momentum and so I feel very good about the timing here.

是的，謝謝。嗯，首先，感謝您的評論，我真的——正如您所說，我確實相信公司非常強大，發展勢頭強勁，所以我對現在的時機感到非常滿意。

As far as P&R, yeah, great start. Look, P&R is the part of the company where, we need to work through the tariff impacts and try to have maximum mitigation of those impacts. It's also got the most diverse set of end markets and both kind of in terms of indications and customers as well as geographies. And so, while we did have a good strong start there, we think that the appropriate thing to do is to still have the same full year guidance and work on trying to outperform that, but wait till we see some more of the movie to lock that in.

就 P&R 而言，是的，很好的開始。你看，P&R 是公司的一部分，我們需要解決關稅影響並嘗試最大程度地減輕這些影響。它還擁有最多樣化的終端市場，無論是在適應症、客戶還是地理方面。因此，雖然我們確實有一個良好的開端，但我們認為適當的做法是仍然保持相同的全年指導並努力超越這一指導，但要等到我們看到更多電影後才能鎖定這一點。

Okay, very helpful. I guess, just on the tariff mitigation efforts, I think you guys called out SKU optimization and rationalization, can you quantify how much revs could be impacted?

好的，非常有幫助。我想，就關稅減免措施而言，我認為你們呼籲 SKU 優化和合理化，你們能量化這會對銷售額造成多大影響嗎？

Yeah, we're still working through that. As you can probably imagine, young, as we're aggressively working on the project plan to shift a lot of those products to other geographies. Now, there are some products that just have smaller margins that we will take advantage of shaping and a more aggressive move this year with regards to our overall end goal of trying to create more growth momentum and mix advantages within the P&R business. So we won't quantify it yet, but as Matt said in terms of our conservative view in terms of the guidance right now has contemplated some of those moves with regards to some SKU trimming and rationalization, and we'll continue to work that as we go forward here.

是的，我們仍在努力解決這個問題。您可能可以想像，年輕時，我們正在積極制定專案計劃，將許多產品轉移到其他地區。現在，有些產品的利潤率較低，我們將利用這些產品進行塑造，並在今年採取更積極的舉措，以實現我們的整體最終目標，即努力在 P&R 業務中創造更多的成長動力和組合優勢。因此，我們暫時不會量化它，但正如馬特所說，就我們目前的指導方針而言，我們保守地考慮了一些與 SKU 修剪和合理化有關的舉措，我們將繼續努力。

Thank you very much. We currently have no more questions. I will hand back over to Matt for any closing remarks.

非常感謝。目前我們沒有其他問題。我將把發言權交還給馬特，請他做最後發言。

Thank you. Thank you for joining us this morning. As I said earlier, this will be my last earnings call as the CEO of Enovis as my successor, Damien McDonald, will take the helm next week on the 12th. I want to take this opportunity to thank each of you for your attention and support of Enovis and its predecessor, Colfax, throughout my tenure. You're in good hands with Damien and Ben and the rest of the team. Thank you for listening in today, and we look forward to sharing our second quarter results with you in early August.

謝謝。感謝您今天上午加入我們。正如我之前所說，這將是我作為 Enovis 執行長的最後一次財報電話會議，因為我的繼任者 Damien McDonald 將於下週 12 日上任。我想藉此機會感謝大家在我任職期間對 Enovis 及其前身 Colfax 的關注和支持。有 Damien、Ben 和團隊其他成員的照顧，您就很安全。感謝您今天的收聽，我們期待在八月初與您分享我們的第二季業績。

Thank you very much, Matt, and thank you for all the speakers on today's line. Thank you, everyone, for joining. You may now disconnect your line.

非常感謝，馬特，也感謝今天所有發言者。謝謝大家的參與。現在您可以斷開線路了。