漢瑞祥 (HSIC) 2023 Q1 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to Henry Schein's First Quarter 2023 Earnings Conference Call. (Operator Instructions) As a reminder, this call is being recorded. And now I would like to introduce you to your host for today's call, Graham Stanley, Henry Schein's Vice President of Investor Relations and Strategic Financial Project Officer. Thank you, Graham. Please go ahead.

女士們先生們，早上好，歡迎來到亨利施恩公司 2023 年第一季度收益電話會議。 （操作員說明）提醒一下，此通話正在錄音中。現在我想向您介紹今天電話會議的主持人，Henry Schein 的投資者關係副總裁兼戰略財務項目官 Graham Stanley。謝謝你，格雷厄姆。請繼續。

Thank you, operator, and my thanks too to you for joining us to discuss Henry Schein's financial results for the first quarter of 2023. With me on the call today are Stanley Bergman, Chairman of the Board and Chief Executive Officer of Henry Schein; and Ron South, Senior Vice President and Chief Financial Officer.

運營商，謝謝您，我也感謝您加入我們討論 Henry Schein 2023 年第一季度的財務業績。今天與我通話的有 Henry Schein 董事會主席兼首席執行官 Stanley Bergman；高級副總裁兼首席財務官 Ron South。

Before we begin, I'd like to state that certain comments made during this call will include information that is forward-looking. As you know, risks and uncertainties involved in the company's business may affect the matters referred to in forward-looking statements. As a result, the company's performance may materially differ from those expressed in or indicated by such statements. These forward-looking statements are qualified in their entirety by the cautionary statements contained in Henry Schein's filings with the Securities and Exchange Commission, and included in the Risk Factors section of those filings.

在我們開始之前，我想聲明在本次電話會議期間發表的某些評論將包含前瞻性信息。如您所知，公司業務中涉及的風險和不確定性可能會影響前瞻性陳述中提及的事項。因此，公司的業績可能與此類聲明中表達或指示的業績存在重大差異。這些前瞻性陳述的全部內容均符合 Henry Schein 向美國證券交易委員會提交的文件中包含的警告聲明，並包含在這些文件的“風險因素”部分中。

In addition, all comments about the markets we serve, including end market growth rates and market share, are based upon the company's internal analysis and estimates. Today's remarks will include both GAAP and non-GAAP financial results. We believe that non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable the comparison of financial results between periods where certain items may vary independently of business performance and allow for greater transparency with respect to key metrics used by management in operating our business.

此外，關於我們所服務市場的所有評論，包括終端市場增長率和市場份額，均基於公司的內部分析和估計。今天的評論將包括 GAAP 和非 GAAP 財務結果。我們認為，非 GAAP 財務措施為投資者提供了有關我們業務財務業績的有用補充信息，能夠比較某些項目可能獨立於業務業績而變化的時期之間的財務結果，並允許在所用關鍵指標方面提高透明度通過管理經營我們的業務。

These non-GAAP financial measures are presented solely for informational and comparative purposes and should not be regarded as a replacement for corresponding GAAP measures. Reconciliations between GAAP and non-GAAP measures are included in Exhibit B of today's press release and can be found in the Financials and Filings section of our Investor Relations website under the Supplemental Information heading. For additional financial information, please refer to our quarterly earnings presentation also posted on our Investor Relations website.

這些非 GAAP 財務措施僅供參考和比較之用，不應被視為相應 GAAP 措施的替代品。 GAAP 和非 GAAP 措施之間的對賬包含在今天新聞稿的附件 B 中，可以在我們的投資者關係網站的“補充信息”標題下的“財務和備案”部分找到。有關其他財務信息，請參閱我們也發佈在我們的投資者關係網站上的季度收益報告。

The content of this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, May 9, 2023. Henry Schein undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. Lastly, during today's Q&A session, please limit yourself to a single question and a follow-up.

本次電話會議的內容包含時效性信息，僅截至直播之日 2023 年 5 月 9 日才准確。漢瑞祥不承擔修改或更新任何前瞻性陳述以反映事件或情況的義務。這次通話的日期。最後，在今天的問答環節中，請將自己限制在一個問題和一個後續問題上。

And with that, I'd like to turn the call over to Stanley Bergman.

有了這個，我想把電話轉給斯坦利伯格曼。

Thank you, Graham. Good morning, everyone. Thank you for joining us this morning. We are most pleased to report very good financial results for the first quarter of 2023 that are in line with expectations we provided at the beginning of the year, and reflect the good earnings momentum in our underlying core businesses. Market trends stayed consistent with those we discussed during the previous quarter's conference call compared to the fourth quarter of last year, where we saw a high number of flu cases, patient traffic to dental offices around the world has recovered and is at or nearing pre-pandemic levels. Patient traffic through the physician practices has also normalized.

謝謝你，格雷厄姆。大家，早安。感謝您今天早上加入我們。我們非常高興地報告 2023 年第一季度非常好的財務業績，這符合我們年初提供的預期，並反映了我們基礎核心業務的良好盈利勢頭。與去年第四季度相比，市場趨勢與我們在上一季度電話會議上討論的趨勢保持一致，去年第四季度我們看到大量流感病例，全球牙科診所的患者流量已經恢復並且處於或接近大流行水平。通過醫生診所的患者流量也已正常化。

As we anticipated, our results continued to be impacted by decreasing sales of PPE products and COVID test kits. Within the PPE COVID category, the (inaudible) was lower, again, as we discussed, but pricing at this stage has stabilized on a sequential basis. COVID-19 test kits volume was lower. Excluding these product categories, we achieved strong internal growth company-wide of 6.3% in local currencies. Our financial results were also adversely impacted by acquisition-related expenses as well as foreign exchange.

正如我們預期的那樣，我們的業績繼續受到 PPE 產品和 COVID 測試套件銷量下降的影響。正如我們所討論的，在 PPE COVID 類別中，（聽不清）再次較低，但現階段的定價已連續穩定。 COVID-19 測試套件的體積較低。排除這些產品類別，我們在全公司範圍內以當地貨幣計算實現了 6.3% 的強勁內部增長。我們的財務業績也受到收購相關費用和外彙的不利影響。

With respect to acquisitions, our pipeline remains robust. In early April, we closed our acquisition of a minority -- of a majority stake in Biotech Dental a business with a market-leading portfolio of dental implants and clear aligners, and we also recently announced our plans to enter the large Brazilian implant market with the acquisition of S.I.N. Implant System, one of Brazil's leading manufacturers of dental implants and a complement to our successful resilient general dental consumables and equipment business. And we also announced the acquisition of Regional Healthcare Group entering the medical market in Australia and New Zealand and leveraging our dental infrastructure in the region, very successful business we have today in the region. I'll discuss these in more details in a moment.

在收購方面，我們的管道仍然強勁。 4 月初，我們完成了對 Biotech Dental 的少數股權和多數股權的收購，該公司擁有市場領先的牙種植體和隱形矯治器產品組合，並且我們最近還宣布了進入巴西大型種植體市場的計劃收購 S.I.N. Implant System，巴西領先的牙科植入物製造商之一，是對我們成功的彈性通用牙科耗材和設備業務的補充。我們還宣布收購 Regional Healthcare Group，進入澳大利亞和新西蘭的醫療市場，並利用我們在該地區的牙科基礎設施，我們今天在該地區擁有非常成功的業務。稍後我將更詳細地討論這些。

Today, we are updating our non-GAAP diluted EPS guidance -- financial guidance for 2023 to include the impact of Biotech Dental, the acquisition of Biotech Dental. The outlook for the underlying business is consistent with prior estimates, including expectations for operating income growth in the high-single to low-double-digit percentage range when excluding the contribution from PPE products and COVID test kits and acquisition-related expenses.

今天，我們正在更新我們的非 GAAP 稀釋後每股收益指南——2023 年的財務指南，以包括 Biotech Dental 的影響，即對 Biotech Dental 的收購。基礎業務的前景與先前的估計一致，包括在排除 PPE 產品和 COVID 測試套件的貢獻以及收購相關費用的情況下，對營業收入增長的預期在高個位數到低兩位數的百分比範圍內。

Let me now turn to a review of the highlights from each of our business units. So let's begin with dental, the dental distribution business. Overall, the underlying fundamentals of our dental end markets remain solid, fueled by an aging global population, low unemployment levels and global -- and a growing global awareness of healthcare benefits of preventative care and oral hygiene. First quarter dental sales growth, excluding PPE products reflect stable patient flow.

現在讓我回顧一下我們每個業務部門的亮點。那麼讓我們從牙科，牙科分銷業務開始。總體而言，在全球人口老齡化、低失業率和全球——以及全球對預防保健和口腔衛生保健益處的認識不斷提高的推動下，我們牙科終端市場的基本面依然穩固。第一季度牙科銷售增長，不包括 PPE 產品反映穩定的患者流量。

Dental merchandise sales, when excluding PPE products, was very good, partially driven by lower prior year merchandise sales comparison that was impacted by the high level of flu cases and some COVID -- Omicron COVID-19. Our dental equipment sales were solid. Traditional equipment sales grew very well, while digital equipment sales comprising of 2D, 3D digital imaging, mills, intra-oral scanners continued to be lower than the previous year.

牙科商品的銷售（不包括 PPE 產品）非常好，部分原因是上一年的商品銷售比較較低，這是受高水平流感病例和一些 COVID-Omicron COVID-19 的影響。我們的牙科設備銷售穩健。傳統設備銷售額增長非常好，而包括 2D、3D 數字成像、研磨機、口腔內掃描儀在內的數字設備銷售額繼續低於上一年。

In North America, the traditional equipment growth included some price increases introduced in the second half of last year as well as good growth in our parts and service business. We've been focusing on this area for a while. This growth was offset by a decrease in sales of digital equipment. The market for intra-oral scanners is healthy, as demonstrated by increased unit sales in the quarter. However, as we commented last quarter, our sales decrease reflects declining average selling price for intra-oral scanners, plus we also had a significant sale in the previous quarter -- in the previous year of scanners to a DSO.

在北美，傳統設備的增長包括去年下半年引入的一些價格上漲以及我們的零部件和服務業務的良好增長。我們關注這個領域已有一段時間了。這一增長被數字設備銷售額的下降所抵消。口腔內掃描儀市場健康，本季度單位銷售額的增長證明了這一點。然而，正如我們上個季度所評論的那樣，我們的銷售額下降反映了口腔內掃描儀平均售價的下降，而且我們在上一季度也有大量銷售——去年掃描儀銷售給 DSO。

Unit sales in other digital categories are lower, and we believe are now normalized compared to the last year. We also posted good sales growth in the dental equipment in Europe. International dental equipment price inflation has not been significant, and the growth was supported by the equipment backlog, which is reverting to a more normalized level in Europe and also our parts and service business is doing quite well. The biennial IDS show in Cologne in March was once again a good event for Henry Schein. And from a sales perspective, the overall impact was consistent with previous IDS meetings. Our global equipment order book, which is mainly comprised of traditional equipment remains robust and it's up year-over-year.

其他數字類別的單位銷售額較低，我們認為與去年相比現在已經正常化。我們還公佈了歐洲牙科設備的良好銷售增長。國際牙科設備價格上漲並不顯著，增長得到了設備積壓的支持，這在歐洲正在恢復到更正常的水平，我們的零件和服務業務也做得很好。 3 月在科隆舉辦的兩年一度的 IDS 展對亨利祥來說又是一次盛會。從銷售的角度來看，整體影響與之前的 IDS 會議一致。我們主要由傳統設備組成的全球設備訂單保持強勁，並且同比增長。

Let's take a look in a bit more detail on our global dental specialties business. Our global dental specialty products sales growth increased from the fourth quarter. We continue to expect modest year-over-year growth to the first half of the year given the strong first half of 2022. Implant sales growth was driven by meaningful growth in our premium Camlog product line in Germany, Austria and Switzerland, where we have our biggest -- strongest market share in the category, and we continue to achieve double-digit growth in our Medentis value price line.

讓我們更詳細地了解一下我們的全球牙科專業業務。我們的全球牙科專業產品銷售額較第四季度有所增長。鑑於 2022 年上半年的強勁勢頭，我們繼續預計今年上半年將實現溫和的同比增長。植入物銷售增長是由我們在德國、奧地利和瑞士的優質 Camlog 產品線的顯著增長推動的，我們在這些國家/地區擁有我們在該類別中最大——最強的市場份額，我們的 Medentis 價值價格線繼續實現兩位數的增長。

In North America, we are seeing an increase in dental specialty practices being acquired by larger DSOs. Importantly, we have excellent relationships with a growing number of DSO accounts and are committed to driving specialty product conversion at practices within those networks. We also continue to see growing adoption of specialty dental procedures amongst general dental practitioners and as demonstrated by enrollment in Henry Schein's continuing education courses in these categories.

在北美，我們看到越來越多的牙科專科診所被大型 DSO 收購。重要的是，我們與越來越多的 DSO 客戶建立了良好的關係，並致力於在這些網絡內的實踐中推動專業產品轉換。我們還繼續看到普通牙科醫師越來越多地採用專業牙科手術，正如 Henry Schein 在這些類別中的繼續教育課程的註冊所證明的那樣。

As mentioned earlier, recent highlights in our global dental specialty business was the acquisition of a majority stake in Biotech Dental and an announcement of our entry into the Brazilian implant market with S.I.N. Implant System -- through the acquisition of the S.I.N. Implant System business. Biotech Dental provides Henry Schein with a comprehensive integrated suite of planning and diagnostic software as well as a fast-growing portfolio of dental implants and clear aligners.

如前所述，我們全球牙科專業業務的近期亮點是收購了 Biotech Dental 的多數股權，並宣布我們與 S.I.N. 一起進入巴西種植體市場。植入系統——通過收購 S.I.N.植入系統業務。 Biotech Dental 為 Henry Schein 提供了一套全面的規劃和診斷軟件集成套件，以及快速增長的牙科植入物和隱形矯治器產品組合。

Together, these products resulted in revenue of approximately $100 million in 2022. We are particularly excited about bringing the Biotech Dental software products to our customers, along with our existing portfolio of practice management, software and clinical software. We will offer a seamless digital workflow solution to a growing number of customers worldwide, very, very exciting.

這些產品共同在 2022 年帶來了約 1 億美元的收入。我們特別高興能將 Biotech Dental 軟件產品連同我們現有的實踐管理、軟件和臨床軟件組合帶給我們的客戶。我們將為全球越來越多的客戶提供無縫的數字工作流程解決方案，非常非常令人興奮。

Last week, we announced a definitive agreement to acquire S.I.N. Implant System, which is one of Brazil's leading manufacturer of dental implants with revenues of approximately $60 million in 2022. This agreement marks our planned entry into the large Brazilian implant market. Brazil has been a very good growth market for Henry Schein, where we have brought good value to Brazilian dentists, and dental laboratories over the last 5 or 6 years since we became active in that market. S.I.N. recently expanded distribution of the value price dental implants to include the United States and other geographies.

上週，我們宣布了收購 S.I.N. 的最終協議。 Implant System 是巴西領先的牙種植體製造商之一，2022 年的收入約為 6000 萬美元。該協議標誌著我們計劃進入龐大的巴西種植體市場。巴西一直是亨利祥的一個非常好的增長市場，自從我們活躍於該市場以來，我們在過去 5 或 6 年里為巴西牙醫和牙科實驗室帶來了良好的價值。罪。最近將牙科植入物的價值價格分佈擴大到包括美國和其他地區。

We expect this transaction to close later this year, subject to, of course, regulatory approval. Both the S.I.N. Implant System and the Biotech Dental transactions represent progress we are making to advance our BOLD+1 strategy, which calls for us to focus internal growth and, of course, business development activities on the high-growth, high-margin opportunities and particularly with innovative products and services.

我們預計該交易將在今年晚些時候完成，當然，前提是要獲得監管部門的批准。 S.I.N. Implant System 和 Biotech Dental 交易代表了我們在推進 BOLD+1 戰略方面取得的進展，該戰略要求我們將重點放在內部增長上，當然還有業務發展活動中的高增長、高利潤機會，尤其是創新產品和服務。

This quarter, our endodontic business continued to grow nicely, primarily through our Brasseler and Edge brands in North America. Our orthodontic business is quite small, but we're pleased with the continued positive development of our clear aligner business, particularly with DSOs. So now let me turn to our Technology and Value-Added Services business, where the largest component is Henry Schein One, which had an excellent quarter. Investing and growing these businesses is a key pillar of our BOLD+1 strategic plan, and we believe our customers are recognizing the advantages in technological innovation that we bring to the marketplace. Growth in North America continues to be driven by Dentrix and Dentrix Ascend cloud-based solutions and customers upgraded from our Easy Dental product with the Easy Dental life cycle ending later this year.

本季度，我們的牙髓業務繼續良好增長，主要是通過我們在北美的 Brasseler 和 Edge 品牌。我們的正畸業務規模很小，但我們對透明矯治器業務的持續積極發展感到高興，尤其是 DSO。那麼現在讓我談談我們的技術和增值服務業務，其中最大的組成部分是 Henry Schein One，它有一個很好的季度。投資和發展這些業務是我們 BOLD+1 戰略計劃的關鍵支柱，我們相信我們的客戶正在認識到我們為市場帶來的技術創新優勢。北美的增長繼續受到 Dentrix 和 Dentrix Ascend 基於雲的解決方案的推動，客戶從我們的 Easy Dental 產品升級到 Easy Dental 生命週期將於今年晚些時候結束。

International growth was supported by the entirely cloud-based solutions for customers outside the United States, particularly in Australia and New Zealand, where it was recently launched. The number of customers on Dentrix Ascend and Dentally, these are our cloud-based solutions, has increased approximately 30% over the last year. We are very, very pleased and excited with our customers moving to the cloud-based -- to our cloud-based solutions. We also saw growth with our revenue cycle management insurance claims product with growth driven by the number of e-claims we processed and enhanced functionality by electronic invoicing and reimbursement solutions.

為美國以外的客戶提供的完全基於雲的解決方案支持了國際增長，特別是在最近推出的澳大利亞和新西蘭。 Dentrix Ascend 和 Dentally（這些是我們基於雲的解決方案）的客戶數量比去年增加了約 30%。對於我們的客戶轉向基於雲的解決方案，我們感到非常非常高興和興奮。我們還看到收入周期管理保險理賠產品的增長，增長是由我們處理的電子索賠數量推動的，並通過電子發票和報銷解決方案增強了功能。

Sales of this product are a strong indicator of the underlying markets as evidenced by higher -- by the higher number of e-claims we processed. In short, our practice management solutions provide a competitive advantage to our dental business. Our highly integrated software is at the core of the operatory and support clinical workflow while improving practice efficiency. Our practice management software also provides opportunities for us to sell products and solutions into the practice, including digital devices, demand generation analytical software as well as our growing AI-enhanced product portfolio.

該產品的銷售額是基礎市場的一個強有力的指標，這一點可以從我們處理的更高數量的電子索賠中得到證明。簡而言之，我們的實踐管理解決方案為我們的牙科業務提供了競爭優勢。我們高度集成的軟件是手術室的核心，支持臨床工作流程，同時提高實踐效率。我們的實踐管理軟件還為我們提供了將產品和解決方案銷售到實踐中的機會，包括數字設備、需求生成分析軟件以及我們不斷增長的人工智能增強產品組合。

Towards the end of the first quarter, we announced the full integration of Detect AI powered by VideaHealth and Bola AI into Dentrix Ascend. This software automatically analyzes digital images to identify and localize carriers, allowing for a faster evaluation of x-rays and effective treatment recommendation. Products -- this AI product offering has been well received. Additionally, our new voice technologic feature improves speed and efficiency for dentists and hygienists when completing periodontal exams and clinical notes. While it is still early in the launch, we have already seen good adoption of this new AI-driven solution, and we are excited to extend our reach and support dentists and provide the best possible patient care. So in our medical business, the distribution business, during the first quarter, our medical business achieved growth of 4%, excluding PPE products and COVID-19 test kits.

在第一季度末，我們宣布將由 VideaHealth 和 Bola AI 提供支持的 Detect AI 完全集成到 Dentrix Ascend 中。該軟件自動分析數字圖像以識別和定位攜帶者，從而可以更快地評估 X 射線和提供有效的治療建議。產品——該 AI 產品廣受好評。此外，我們新的語音技術功能提高了牙醫和衛生員完成牙周檢查和臨床記錄時的速度和效率。雖然它仍處於發布初期，但我們已經看到這種新的 AI 驅動解決方案得到了很好的採用，我們很高興能夠擴大我們的影響範圍並支持牙醫並提供最好的患者護理。因此，在我們的醫療業務、分銷業務中，第一季度，我們的醫療業務實現了 4% 的增長，不包括 PPE 產品和 COVID-19 測試套件。

As I mentioned last quarter, we expect the internal sales growth in our underlying medical business to continue to grow quite nicely, but at a somewhat slower pace this year than last year, given the prior year comparison resulting from significant growth we achieved last year. We remain highly bullish also on our medical business. Unit sales for COVID tests were down significantly. And within the PPE category, drop pricing has stabilized, albeit at a lower price than last year.

正如我在上個季度提到的那樣，我們預計我們基礎醫療業務的內部銷售增長將繼續保持良好增長，但今年的增長速度將比去年慢一些，因為我們去年實現了顯著增長，因此與去年同期相比。我們仍然高度看好我們的醫療業務。 COVID 測試的單位銷售額大幅下降。在 PPE 類別中，降價已經穩定，儘管價格低於去年。

Looking at specific product categories, once again, pharmaceutical and equipment sales were strong, while sales of point-of-care diagnostic products decreased to some extent because of the high flu diagnosis last year this quarter. We were also pleased to announce our acquisition of Regional Healthcare Group in Australia and New Zealand, both growing markets that have contributed to the growth of our dental business. Through this acquisition, we will be able to further leverage our Australian and New Zealand infrastructure and expand our global medical products footprint.

從具體產品類別來看，藥品和設備銷售再次強勁，而即時診斷產品的銷售在本季度因去年流感診斷率高而有所下降。我們還很高興地宣布收購澳大利亞和新西蘭的 Regional Healthcare Group，這兩個不斷增長的市場為我們的牙科業務的增長做出了貢獻。通過此次收購，我們將能夠進一步利用我們在澳大利亞和新西蘭的基礎設施，擴大我們的全球醫療產品足跡。

In summary, the underlying fundamentals of our core business remain solid, and we are executing well as anticipated with our BOLD+1 strategic plan. So we're very comfortable with where we are. We're bullish about the business and are excited as we advance our BOLD+1 strategy.

總而言之，我們核心業務的基本面依然穩固，我們的 BOLD+1 戰略計劃執行得如預期。所以我們對我們所處的位置非常滿意。我們看好這項業務，並對推進 BOLD+1 戰略感到興奮。

With that in mind, I will turn the call over to Ron to discuss our first quarter financial results and our full year guidance. Thank you very much, everyone.

考慮到這一點，我將把電話轉給羅恩，討論我們第一季度的財務業績和全年指導。非常感謝大家。

Thank you, Stanley, and good morning, everyone. As we begin, I'd like to point out that I will be discussing our results as reported on a GAAP basis and also on a non-GAAP basis. Our first quarter non-GAAP financial results for 2023 and 2022 exclude restructuring costs as well as amortization expense of acquired intangible assets. This is detailed in Exhibit B of today's press release.

謝謝你，斯坦利，大家早上好。在我們開始時，我想指出，我將討論我們在 GAAP 基礎上和非 GAAP 基礎上報告的結果。我們 2023 年和 2022 年第一季度的非 GAAP 財務業績不包括重組成本以及所收購無形資產的攤銷費用。這在今天的新聞稿的附件 B 中有詳細說明。

With respect to sales growth, I will focus on LCI sales growth, which is internally generated sales in local currencies compared to the prior year and excludes acquisitions. First quarter global sales are $3.1 billion reflected an LCI sales decrease of 3.7%. However, when excluding sales of PPE products and COVID-19 test kits, our LCI sales grew 6.3%. This sales growth benefited somewhat from the timing of our fiscal reporting calendar whereby the December 2021 holiday week was included in the first quarter of 2022, but Q1 2023 did not include a holiday week as it fell in the fourth quarter of 2022.

關於銷售增長，我將重點關注 LCI 銷售增長，這是與上一年相比以當地貨幣計算的內部產生的銷售額，不包括收購。第一季度全球銷售額為 31 億美元，反映了 LCI 銷售額下降 3.7%。然而，如果不包括 PPE 產品和 COVID-19 測試套件的銷售額，我們的 LCI 銷售額增長了 6.3%。這種銷售增長在一定程度上得益於我們的財政報告日曆的時間安排，即 2021 年 12 月的假期週被包括在 2022 年第一季度，但 2023 年第一季度不包括假期週，因為它在 2022 年第四季度有所下降。

In the first quarter of 2023, we sold $149 million in PPE products, a decline of approximately 35% year-over-year and $52 million in COVID-19 test kits, a decline of approximately 80% year-over-year. On a combined basis, PPE and COVID-19 test kits declined approximately 60%. As a reminder, our first quarter sales in both PPE and COVID-19 test kits were especially strong last year.

2023 年第一季度，我們銷售了 1.49 億美元的 PPE 產品，同比下降約 35%，銷售了 5200 萬美元的 COVID-19 測試套件，同比下降了約 80%。綜合來看，PPE 和 COVID-19 測試套件下降了約 60%。提醒一下，我們去年第一季度的 PPE 和 COVID-19 測試套件銷量特別強勁。

Our GAAP operating margin for the first quarter of 2023 was 5.7%, a 196 basis point decline compared with the prior year GAAP operating margin. Our non-GAAP operating margin for Q1 was 7.7%, a 102 basis point decline compared with the prior year non-GAAP operating margin. This decline was mainly a result of lower gross profit dollars from PPE and COVID-19 test kit sales, which helped to cover our fixed costs as well as higher acquisition-related costs, partially offset by gross margin rate improvement.

我們 2023 年第一季度的 GAAP 營業利潤率為 5.7%，與上年 GAAP 營業利潤率相比下降 196 個基點。我們第一季度的非 GAAP 營業利潤率為 7.7%，與去年非 GAAP 營業利潤率相比下降了 102 個基點。這一下降主要是由於 PPE 和 COVID-19 測試套件銷售的毛利潤較低，這有助於彌補我們的固定成本以及較高的收購相關成本，部分被毛利率的提高所抵消。

First quarter 2023 GAAP net income was $121 million or $0.91 per diluted share. This compares with prior year GAAP net income of $181 million or $1.30 per diluted share. Our first quarter 2023 non-GAAP net income was $161 million or $1.21 per diluted share. This compares with prior year non-GAAP net income of $200 million or $1.44 per diluted share. Several factors adversely impacted our GAAP and non-GAAP results this quarter. Specifically, the contribution from PPE products and COVID-19 test kit sales to diluted EPS decreased by an estimated $0.24 per diluted share relative to the prior year period.

2023 年第一季度 GAAP 淨收入為 1.21 億美元或每股攤薄收益 0.91 美元。相比之下，去年 GAAP 淨收入為 1.81 億美元或每股攤薄收益 1.30 美元。我們 2023 年第一季度的非 GAAP 淨收入為 1.61 億美元或每股攤薄收益 1.21 美元。相比之下，上一年非 GAAP 淨收入為 2 億美元或每股攤薄收益 1.44 美元。有幾個因素對我們本季度的 GAAP 和非 GAAP 結果產生了不利影響。具體而言，PPE 產品和 COVID-19 測試套件銷售對攤薄每股收益的貢獻與去年同期相比估計減少了每股攤薄 0.24 美元。

Acquisition-related costs impacted diluted EPS by $0.04 per diluted share this year compared with approximately $0.015 per diluted share last year. And note that these acquisition costs are operating expenses that we do not add back for non-GAAP reporting purposes. Additionally, foreign currency exchange negatively impacted our first quarter diluted EPS by approximately $0.02 versus the first quarter last year.

今年與收購相關的成本對攤薄後每股收益的影響為 0.04 美元，而去年約為每股攤薄後 0.015 美元。請注意，這些收購成本是運營費用，我們不會出於非 GAAP 報告目的而加回去。此外，與去年第一季度相比，外幣兌換對我們第一季度的攤薄每股收益產生了約 0.02 美元的負面影響。

So turning to our first quarter sales results. Global Dental sales were $1.9 billion, and LCI sales increased by 4%. When excluding sales of PPE products, LCI sales growth was 7.4%. Global Dental merchandise LCI sales increased by 4%, but increased by 8.4% when excluding PPE products. We expected strong merchandise sales growth as last year's sales were impacted by the Omicron variant and timing of the reporting calendar, as I previously mentioned.

因此，轉向我們的第一季度銷售業績。全球牙科銷售額為 19 億美元，LCI 銷售額增長了 4%。排除 PPE 產品的銷售額，LCI 銷售額增長 7.4%。全球牙科商品 LCI 銷售額增長了 4%，但不包括 PPE 產品時增長了 8.4%。正如我之前提到的，我們預計商品銷售將強勁增長，因為去年的銷售受到 Omicron 變體和報告日曆時間的影響。

North America dental merchandise sales increased 1.3% and by 6.6% when excluding sales of PPE products. International dental merchandise LCI sales increased by 8.1% or 11% when excluding sales of PPE products with strong sales growth in Central Europe, Australia as well as in Brazil. Global Dental equipment LCI growth was 3.9%. We had strong LCI sales growth for traditional equipment, and this was offset by a decrease in digital equipment LCI sales.

北美牙科商品銷售額增長 1.3%，不包括 PPE 產品銷售額則增長 6.6%。如果不包括在中歐、澳大利亞和巴西銷售增長強勁的 PPE 產品，國際牙科商品 LCI 銷售額增長 8.1% 或 11%。全球牙科設備 LCI 增長率為 3.9%。傳統設備的 LCI 銷售額增長強勁，但數字設備 LCI 銷售額的下降抵消了這一增長。

Our North America dental equipment LCI sales increased 2.6%. International equipment LCI sales increased by 5.8% and were bolstered by tax incentives in Italy and the U.K., which ended this quarter, and in Australia, which are due to expire at the end of the second quarter. Dental specialty products include implants, bone regeneration materials, orthodontic products and endodontic products. Sales of these products were approximately $233 million in the first quarter with LCI growth of 4.4%. Global technology and value-added services sales during Q1 were $191 million, with LCI growth of 6.5%. Sales were again negatively impacted by a government contract, which expired early in the third quarter of 2022. LCI sales growth was 12.4% when adjusting for this contract.

我們的北美牙科設備 LCI 銷售額增長了 2.6%。國際設備 LCI 銷售額增長了 5.8%，這得益於本季度結束的意大利和英國以及將於第二季度末到期的澳大利亞的稅收優惠政策。牙科專業產品包括種植體、骨再生材料、正畸產品和牙髓產品。第一季度這些產品的銷售額約為 2.33 億美元，LCI 增長率為 4.4%。第一季度全球技術和增值服務銷售額為 1.91 億美元，LCI 增長 6.5%。銷售再次受到政府合同的負面影響，該合同於 2022 年第三季度初到期。根據該合同進行調整後，LCI 銷售額增長了 12.4%。

In North America, sales growth was driven by our practice management and revenue cycle management businesses. Growth internationally was driven by our Dentally cloud-based solution. Global Medical sales during the first quarter were $971 million, and LCI sales decreased 17.1% due to lower sales of PPE products and COVID-19 test kits. In North America, excluding sales of PPE products and COVID-19 test kits, LCI sales grew 4.2%, led by strong medical equipment and pharmaceutical sales offset by lower point of care diagnostics revenue.

在北美，銷售增長是由我們的實踐管理和收入周期管理業務推動的。我們的 Dentally 基於雲的解決方案推動了國際增長。第一季度全球醫療銷售額為 9.71 億美元，由於 PPE 產品和 COVID-19 測試套件的銷售額下降，LCI 銷售額下降了 17.1%。在北美，不包括 PPE 產品和 COVID-19 測試套件的銷售額，LCI 銷售額增長了 4.2%，主要是強勁的醫療設備和藥品銷售被較低的護理點診斷收入所抵消。

Keep in mind, this is against a difficult comparison as North American medical LCI sales growth, excluding PPE and COVID-19 test kits, was approximately 15% in Q1 of 2022, driven by higher office visits related to the Omicron variant. Regarding stock repurchases, we repurchased approximately 1.2 million shares of common stock in the open market during the first quarter buying at an average price of $81.70 per share for a total of $100 million.

請記住，這是一個艱難的比較，因為北美醫療 LCI 銷售增長（不包括 PPE 和 COVID-19 測試套件）在 2022 年第一季度約為 15%，這是由於與 Omicron 變體相關的辦公室訪問量增加所致。關於股票回購，我們在第一季度以每股 81.70 美元的平均價格回購了約 120 萬股普通股，總計 1 億美元。

Turning to our balance sheet and cash flow. We continue to benefit from significant liquidity, providing our businesses with the financial flexibility and stability to execute on our organic growth initiatives and strategic acquisitions, while continuing to return capital to our stockholders. Operating cash flow for the first quarter was $27 million compared with $93 million last year, with the decrease primarily due to lower income from PPE and COVID-19 test kits as well as restructuring expenses incurred in the quarter. Those restructuring expenses in Q1 were $30 million or $0.16 per diluted share and were incurred as part of our previously disclosed restructuring initiative. These expenses mainly relate to severance benefits and costs related to the exit of facilities. We expect to continue to record restructuring charges during the remainder of 2023.

轉向我們的資產負債表和現金流量。我們繼續受益於巨大的流動性，為我們的企業提供財務靈活性和穩定性，以執行我們的有機增長計劃和戰略收購，同時繼續向我們的股東返還資本。第一季度的運營現金流為 2700 萬美元，而去年同期為 9300 萬美元，下降的主要原因是 PPE 和 COVID-19 測試套件的收入減少以及本季度發生的重組費用。第一季度的這些重組費用為 3000 萬美元或攤薄後每股 0.16 美元，是我們之前披露的重組計劃的一部分。這些費用主要與遣散費和與設施退出相關的成本有關。我們預計在 2023 年剩餘時間內將繼續記錄重組費用。

Let me conclude my remarks with our 2023 financial guidance. At this time, we are still unable to provide estimates for costs associated with integration and restructuring for 2023. Therefore, we are not providing GAAP guidance. We are updating our guidance for 2023 non-GAAP diluted EPS attributable to Henry Schein to a range of $5.18 to $5.35 per share, reflecting growth of negative 4% to negative 1% compared with our 2022 non-GAAP diluted EPS of $5.38. This guidance now includes $0.05 to $0.10 of estimated dilution for the Biotech Dental acquisition, primarily due to acquisition accounting adjustments for inventory and integration-related expenses.

讓我以我們的 2023 年財務指南結束我的發言。目前，我們仍無法提供 2023 年與整合和重組相關的成本估算。因此，我們不提供 GAAP 指南。我們將 2023 年非 GAAP 稀釋每股收益的指引更新為每股 5.18 美元至 5.35 美元，反映出與我們 2022 年 5.38 美元的非 GAAP 稀釋每股收益相比負增長 4% 至負 1%。該指南現在包括 Biotech Dental 收購的 0.05 美元至 0.10 美元的估計攤薄，這主要是由於對庫存和整合相關費用的收購會計調整。

Our outlook for the remainder of the business remains consistent with our prior guidance. Our guidance for 2023 assumes total sales growth of approximately 1% to 3% over 2022, with sales of COVID-19 test kits now expected to decline by approximately 65% to 70% from sales in 2022 as compared to our previous 2023 guidance of a decline of 35% to 40%. Additionally, PPE product sales are expected to decline about 20% to 25%, consistent with our original 2023 guidance. Note that our sales growth guidance reflects 1 less selling week in 2023 than in 2022.

我們對其餘業務的展望與我們之前的指導一致。我們對 2023 年的指導假設總銷售額比 2022 年增長約 1% 至 3%，與我們之前的 2023 年指導相比，現在預計 COVID-19 測試套件的銷售額將比 2022 年的銷售額下降約 65% 至 70%下降 35% 至 40%。此外，PPE 產品銷售額預計將下降約 20% 至 25%，這與我們最初的 2023 年指引一致。請注意，我們的銷售增長指導反映了 2023 年的銷售週比 2022 年少 1 週。

The impact on 2023 non-GAAP diluted EPS from lower sales of PPE products and COVID-19 test kits is still estimated to be $0.35 to $0.40. We expect the impact of the steeper-than-anticipated decrease decreases in COVID-19 test kit sales in 2023 to be offset by slightly higher-than-anticipated gross margins on PPE sales relative to our original guidance. These headwinds are anticipated to be largely offset by earnings momentum in our underlying core businesses, and we expect non-GAAP operating income will grow in the high-single-digit to low-double-digit range when excluding the contribution from PPE products and COVID-19 test kit sales and acquisition-related expenses.

PPE 產品和 COVID-19 測試套件銷售額下降對 2023 年非 GAAP 攤薄每股收益的影響估計仍為 0.35 美元至 0.40 美元。我們預計 2023 年 COVID-19 測試套件銷售額下降幅度大於預期的影響將被略高於預期的 PPE 銷售毛利率（相對於我們最初的指導）所抵消。預計這些不利因素將在很大程度上被我們基礎核心業務的盈利勢頭所抵消，我們預計在排除 PPE 產品和 COVID 的貢獻時，非 GAAP 營業收入將在高個位數至低兩位數範圍內增長-19 測試套件銷售和收購相關費用。

We expect lower non-GAAP operating margin of 10 to 15 basis points below the 2022 non-GAAP operating margin of 8.2% and this was largely a result of lower PPE products and COVID-19 test kit sales and profits. Our guidance reflects non-GAAP operating margin expansion when excluding income from PPE products and COVID-19 test kit sales and acquisition-related expenses. Our 2023 guidance includes higher interest expense than in 2022 as a result of higher interest rates and higher borrowings along with higher minority interest from our higher growth businesses such as Henry Schein One. We also expect an effective tax rate in the 23% range, assuming no changes in tax legislation.

我們預計非 GAAP 營業利潤率比 2022 年 8.2% 的非 GAAP 營業利潤率低 10 至 15 個基點，這主要是由於 PPE 產品和 COVID-19 測試套件的銷售和利潤較低。我們的指引反映了在排除 PPE 產品收入和 COVID-19 測試套件銷售和收購相關費用後的非 GAAP 營業利潤率增長。我們的 2023 年指引包括由於更高的利率和更高的借款以及我們更高增長的業務（例如 Henry Schein One）的更高少數股東權益而導致的利息支出高於 2022 年。假設稅法沒有變化，我們還預計有效稅率在 23% 的範圍內。

Our guidance for 2023 diluted EPS is for current continuing operations as well as completed acquisitions and does not include the impact of future share repurchases, other announced or potential future acquisitions or integration and restructuring expenses. While the recently closed Biotech Dental acquisition is now reflected within our guidance, our recently announced acquisition of S.I.N. Implant System is not. Guidance also assumes that foreign currency exchange rates are generally consistent with current levels and that end markets remain consistent with current market conditions.

我們對 2023 年攤薄後每股收益的指導是針對當前的持續經營和已完成的收購，不包括未來股票回購、其他已宣布或未來可能的收購或整合和重組費用的影響。雖然最近結束的 Biotech Dental 收購現在反映在我們的指導中，但我們最近宣布的對 S.I.N 的收購。植入系統不是。指南還假設外幣匯率與當前水平基本一致，並且終端市場與當前市場狀況保持一致。

To summarize, although we are updating our financial guidance for the year, we are maintaining expectations for the underlying business and continue to anticipate steady growth trends in both dental and medical markets. And we do expect that the second quarter will continue to have some headwinds from PPE and COVID-19 test kits, but we do expect good income growth in the second half of the year as some of the year-over-year comparatives already covered on this call should normalize.

總而言之，儘管我們正在更新今年的財務指引，但我們仍維持對基礎業務的預期，並繼續預期牙科和醫療市場的穩定增長趨勢。我們確實預計第二季度將繼續受到 PPE 和 COVID-19 測試套件的一些不利影響，但我們確實預計下半年收入將有良好增長，因為一些同比比較已經涵蓋這個電話應該正常化。

With that, I'll now turn the call back to Stanley.

有了這個，我現在將電話轉回給斯坦利。

Thank you, Ron. Graham, if we can now open the call to questions, we'll be happy to answer any questions investors may have.

謝謝你，羅恩。格雷厄姆，如果我們現在可以開始提問，我們將很樂意回答投資者可能提出的任何問題。

(Operator Instructions) Our first question comes from the line of Jason Bednar with Piper Sandler.

（操作員說明）我們的第一個問題來自 Jason Bednar 和 Piper Sandler 的台詞。

Ron, I wanted to start on the margin performance in the quarter, really a couple of inter-time questions here. First, the gross margins hit a multi-year high in the first quarter. Hoping you could expand upon maybe the drivers of the margin performance in the quarter, especially considering your higher-margin high-tech equipment sales were down year-over-year. And then I'm sure there's questions out there regarding the lack of drop-through from that gross margin upside looks like some maybe above normal SG&A spend and as fixed cost absorption wasn't as great because of the PPE dynamics you mentioned. Just wondering if you could talk about any other puts and takes that impacted SG&A spend in the quarter is really, we think, through gross and operating margin cadence for the rest of '23? .

羅恩，我想從本季度的利潤率表現開始，這裡真的有幾個臨時問題。首先，一季度毛利率創多年新高。希望您能擴大本季度利潤率表現的驅動因素，特別是考慮到您的高利潤率高科技設備銷售額同比下降。然後我敢肯定，關於毛利率上升缺乏下降的問題，看起來有些可能高於正常的 SG&A 支出，而且由於你提到的 PPE 動態，固定成本吸收沒有那麼大。只是想知道您是否可以談談影響本季度 SG&A 支出的任何其他看跌期權，我們認為，真的是通過 23 年剩餘時間的毛利率和營業利潤率節奏？ .

I think the -- on the margin question and as you mentioned, the specialty businesses perhaps did not grow as much, but they did grow, and this is a year or a quarter, I should say, where year-over-year we actually had some contraction in reported sales. So that growth still takes on a greater mix, right? So we're getting the benefits of a greater mix from our specialty products and the growth that we experienced on the technology and value-added services side. And that mix is favorable to the gross margin. I think, too, that while within the distribution sector, we tend to get slightly better gross margins in dental and the growth we had in dental versus medical and the growth we had in dental versus medical I think also contributes to that particular margin performance being as high as it was.

我認為 - 關於利潤率問題，正如你提到的，專業業務可能沒有增長那麼多，但他們確實增長了，這是一年或一個季度，我應該說，我們實際上報告的銷售額有所收縮。所以這種增長仍然需要更大的組合，對吧？因此，我們從我們的專業產品以及我們在技術和增值服務方面所經歷的增長中獲得了更大組合的好處。這種組合有利於毛利率。我也認為，雖然在分銷領域，我們傾向於在牙科領域獲得略高的毛利率，我們在牙科領域與醫療領域的增長以及我們在牙科領域與醫療領域的增長我認為也有助於特定的利潤率表現和原來一樣高。

On SG&A, I think that we have a fair number of expenses that are fixed. So the operating margin itself is going to come down some as those gross profit dollars are lower from the lower contribution from PPE and COVID test kits. So I think that's what we're seeing primarily the drag on the operating margin. I think -- from an SG&A standpoint, we had -- we did have a little bit of an increase in costs, but some of those are related to the acquisition costs that we incurred during the quarter. We've got a very robust pipeline, the nature of these transactions that we've been doing, as you can see from the last couple of implant transactions that we announced require a little more work on the acquisition side. And so I think that, that was a bit of a drag on SG&A as well.

在 SG&A 方面，我認為我們有相當多的固定費用。因此，由於 PPE 和 COVID 測試套件的貢獻較低，這些毛利潤美元較低，因此營業利潤率本身將有所下降。所以我認為這就是我們主要看到的對營業利潤率的拖累。我認為——從 SG&A 的角度來看，我們確實有一點成本增加，但其中一些與我們在本季度產生的收購成本有關。我們有一個非常強大的管道，我們一直在做的這些交易的性質，正如你從我們宣布的最近幾筆植入交易中看到的那樣，需要在收購方面做更多的工作。所以我認為，這對 SG&A 也有點拖累。

Okay. That's helpful. Maybe I'll actually use your response there as a bit of a segue to the next question. If we look at the guidance adjustment, modest reduction you're making today for EPS, you were pretty transparent with the Biotech deal that was going to be dilutive from some of those onetime costs. How should we think about the recognition of that headwind throughout the year, does that higher cost inventory from inventory step up mostly flow through your model of the 2Q and 3Q? And then I know the recent S.I.N. transaction is a bit smaller than Biotech, but maybe just to be clear, we should expect another kind of onetime impact from inventory step-up once this deal closes? And then can you confirm each of these deals are accretive in year 1 when excluding these inventory accounting adjustments? .

好的。這很有幫助。也許我實際上會用你的回答來作為下一個問題的線索。如果我們看一下指導調整，你今天對 EPS 進行的適度減少，你對生物技術交易非常透明，這將稀釋其中一些一次性成本。我們應該如何看待全年逆風的認識，庫存增加帶來的更高成本庫存是否主要流經您的第二季度和第三季度模型？然後我知道了最近的 S.I.N.交易比生物技術要小一些，但也許只是為了清楚起見，一旦交易完成，我們應該期待庫存增加帶來的另一種一次性影響？然後，在排除這些庫存會計調整後，您能否確認這些交易中的每一項在第一年都是增值的？ .

Yes. So I'll start with kind of the effect of the inventory adjustments. And your typical implant business will turn inventory, say, a couple of times a year. So that means it's going to take us about 6 months to work through that inventory step-up value that will kind of be a drag on the gross margin for that period of time, so yes, Q2, Q3, as we work through the inventory step-up. And we're still working on finalizing with that actual. We have some estimates. We don't have a final number on that inventory step-up.

是的。所以我將從庫存調整的影響開始。典型的植入物業務每年會周轉幾次庫存。因此，這意味著我們將需要大約 6 個月的時間來處理庫存增加值，這會拖累那段時間的毛利率，所以是的，第二季度，第三季度，當我們處理庫存時升壓。我們仍在努力最終確定該實際情況。我們有一些估計。我們沒有關於庫存增加的最終數字。

In terms of the remainder part of Biotech, there are going to be some costs incurred this year that are what I'm calling integration-related costs, it's really -- we bought a company that has multiple sites, multiple locations, and it was a privately run business. So you have to spend some money to get it ready to be part of a public company, right? So we're going to incur some expenses in that respect. But we do expect Biotech to be accretive post 2023. We think once we get into 2024, it will definitely be accretive for us.

就生物技術的其餘部分而言，今年將產生一些成本，我稱之為整合相關成本，真的——我們收購了一家擁有多個站點、多個地點的公司，而且它是私營企業所以你必須花一些錢來準備成為上市公司的一部分，對吧？因此，我們將在這方面產生一些費用。但我們確實預計生物技術將在 2023 年後實現增長。我們認為一旦進入 2024 年，它肯定會為我們帶來增長。

With reference to S.I.N., the deal that we just announced, that deal has not closed yet. And it's going through the process of being reviewed by the Brazilian regulatory body. So we're not sure when that's going to close. I think in our press release, we just basically said the latter half of 2023 because we don't have a strong estimate of when that will close. So we don't really know the effect on the current year because, again, of that inventory step-up that we'll have to manage, but we also believe S.I.N. once we get through those inventory adjustments, and we get into -- and hopefully, we can close it earlier in '23 rather than later because then when we get into 2024, it should be accretive for us in '24 as well.

關於 S.I.N.，我們剛剛宣布的交易，該交易尚未完成。它正在接受巴西監管機構的審查。所以我們不確定什麼時候關閉。我認為在我們的新聞稿中，我們基本上只是說 2023 年下半年，因為我們對何時關閉沒有強有力的估計。所以我們真的不知道對今年的影響，因為我們必須管理的庫存增加，但我們也相信 S.I.N.一旦我們完成了這些庫存調整，我們就會進入——希望我們能在 23 年早些時候而不是晚些時候關閉它，因為當我們進入 2024 年時，它也應該對我們在 24 年有所增加。

And the next question comes from the line of Nathan Rich with Goldman Sachs.

下一個問題來自 Nathan Rich 與高盛的合作。

Ron, maybe just a clarification. Have you sized the sales benefit of 1Q not having -- not starting with that holiday week in terms of impact on the dental consumables business? And then maybe more at a high level, it sounds like you feel like patient demand has been pretty stable through the first quarter. I guess kind of any puts and takes that you're seeing from an end market standpoint, especially since the international consumables number in particular, continue to look pretty strong.

羅恩，也許只是一個澄清。就牙科耗材業務的影響而言，您是否評估了 1Q 的銷售收益 - 不是從那個假期週開始？然後可能更高的水平，聽起來你覺得患者需求在第一季度一直非常穩定。我想從終端市場的角度來看，你所看到的任何看跌期權，尤其是因為國際消耗品數量繼續看起來非常強勁。

Yes. I think I'll start with the fiscal calendar question, Nathan. I think that it's probably worth -- it's worth a couple of points to us of growth in the quarter, right? It can kind of vary market-to-market. It's more pronounced internationally than it is in the U.S. You do -- we had some international markets where dental practices, they close that week between Christmas and New Year's, right? So you get very limited sales. So it's more pronounced in some markets than others, but I think overall, globally, it's worth probably a couple of points on that merchandise. When I say a couple of points, I'm talking about specifically on the dental merchandise number.

是的。內森，我想我將從財政日曆問題開始。我認為這可能值得 - 對我們來說本季度的增長值得幾個點，對吧？它可能因市場而異。它在國際上比在美國更為明顯。你知道 - 我們有一些國際市場的牙科診所，他們在聖誕節和新年之間的那個星期關閉，對嗎？所以你的銷售額非常有限。所以它在某些市場比其他市場更明顯，但我認為總體而言，在全球範圍內，該商品可能值得幾個點。當我說幾點時，我是在專門談論牙科商品編號。

In terms of patient traffic, I think we're seeing pretty steady patient traffic at this point. I think it's a fairly normalized market in that respect in that we're not seeing the fluctuations in patient traffic. We're not hearing about this from our customers as much as we have historically. So I think that -- and I think that continued into April as well where patient traffic was fairly consistent with what we saw in the first quarter.

就患者流量而言，我認為此時我們看到相當穩定的患者流量。我認為在這方面這是一個相當正常的市場，因為我們沒有看到患者流量的波動。我們沒有像以往那樣從客戶那裡聽到很多關於這方面的信息。所以我認為——我認為這種情況一直持續到 4 月份，患者流量與我們在第一季度看到的情況相當一致。

Great. And then can you talk maybe about how you expect the specialties business to trend throughout the year? Because I think if I caught the number right, it was about 4% in the quarter. I think you had talked about maybe mid- to high-single-digit growth for the year. I know comparisons for that business get a little bit easier. But just from a demand for implants and orthodontic procedures, can you just maybe talk about what you're seeing and how that -- you expect that to trend over the rest of the year? .

偉大的。然後你能談談你對特種食品業務全年趨勢的預期嗎？因為我想如果我沒記錯的話，這個季度大約是 4%。我想你已經談到了今年可能實現中高個位數的增長。我知道對該業務的比較會變得更容易一些。但是僅僅從對植入物和正畸手術的需求來看，你能不能談談你所看到的以及它是如何——你預計今年餘下時間會出現這種趨勢？ .

Yes. I mean as you mentioned, we think the comps will get a little easier for this dental specialty products in the back half of the year versus the first half of the year. But even like within implants, as we mentioned in the prepared remarks, in Europe, we had double-digit growth in implants. But in the U.S., it was a much tougher comp. Last year, the U.S. had double-digit growth in implants. So it was a tougher comp when we saw -- as a result, we saw lower growth there. Endodontic products are still doing very well, very steady for us and growing kind of in high-single digits. So that's -- there are pockets of really, really good performance. And we think that as we progress into the back half of the year and those comps get easier, we expect that growth to become a little more robust. .

是的。我的意思是，正如你所提到的，我們認為與今年上半年相比，今年下半年這種牙科專業產品的補償會更容易一些。但即使在植入物中，正如我們在準備好的評論中提到的那樣，在歐洲，我們的植入物也有兩位數的增長。但在美國，這是一個更艱難的競爭。去年，美國的植入物增長了兩位數。因此，當我們看到時，這是一個更艱難的競爭——結果，我們看到那裡的增長較低。牙髓產品仍然表現良好，對我們來說非常穩定，並且以高個位數增長。這就是 - 有一些非常非常好的表現。而且我們認為，隨著我們進入今年下半年並且這些組合變得更容易，我們預計增長會變得更加強勁。 .

And the next question comes from the line of A.J. Rice with Crédit Suisse.

下一個問題來自 A.J.瑞士信貸的米飯。

First, I thought I'd ask you about the conference in Cologne. I know that's a big event. Did you -- and you mentioned last quarter that you were watching to see whether it had any impact on sales. Does that -- is there any impact that you've seen in Q1? Or do you think there would be any spillover benefit in Q2? And then obviously, you've got a European market where there's some concern about the economy. Did you walk away with any takeaways regarding the equipment market because of what you picked up at the conference? .

首先，我想問一下在科隆舉行的會議。我知道那是一件大事。你有沒有 - 你在上個季度提到你正在觀察它是否對銷售有任何影響。你在第一季度看到了什麼影響嗎？或者您認為第二季度會有溢出效應嗎？然後很明顯，你有一個歐洲市場，那裡對經濟有一些擔憂。由於您在會議上的收穫，您是否對設備市場有任何收穫？ .

Yes. The Cologne show was good for us. Remember, it's primarily focused on Germany and Austria from a selling point of view. And overall, it was as good as previous years. The equipment market in Europe is quite stable. And yes, there's a slight issue in France. There was a strike in April, but that doesn't really have significant impact on the whole business. We'll call that out if it is. But generally, I would say the European and international equipment market from our point of view is stable. There are puts and takes. The traditional equipment is a little bit better. And there is some deflation in units pricing for the DI products. Mills are starting to be stable again. And there's some growth you can expect from 3D printing. But I think generally, the market is pretty stable now.

是的。科隆展對我們有好處。請記住，從銷售的角度來看，它主要關注德國和奧地利。總的來說，它和往年一樣好。歐洲的設備市場相當穩定。是的，法國有一個小問題。 4 月份發生了一次罷工，但這並沒有真正對整個業務產生重大影響。如果是的話，我們會把它說出來。但總的來說，從我們的角度來看，歐洲和國際設備市場是穩定的。有看跌期權。傳統設備好一點。 DI 產品的單位定價存在一些通貨緊縮。米爾斯再次開始穩定。您可以期待 3D 打印帶來一些增長。但我認為總的來說，現在市場相當穩定。

Okay. Maybe just a follow-up on the medical ex the test and PPE, you did about 4% -- a little better than 4% this quarter. Is that what's sort of embedded in your expectations for the rest of the year? I know there's this whole debate about people coming back to the healthcare system, et cetera, and maybe that's adding some incremental demand? Are you seeing any of that? Do you think you might see more of that as we progress through the year?

好的。也許只是對醫療測試和個人防護裝備的跟進，你做了大約 4%——比本季度的 4% 好一點。這是你對今年餘下時間的期望嗎？我知道關於人們回到醫療保健系統等等的整個爭論，也許這會增加一些增量需求？你看到了嗎？你認為隨著我們這一年的進步，你會看到更多嗎？

Yes. There are some device companies that were much more impacted by the ups and downs. We were only slightly impacted because there were a lot more visits last year because of -- early part of the year because of whether it was COVID or flu, different kinds of flu. But we had pretty high comps then, but I think it starts getting better as the year goes by. And our businesses continue to be steady when you really take out the test. I would say that PPE is -- we're pretty normalized now. But the test, obviously, for -- COVID tests are going down. And I don't know if that will continue. We've tried to give you best guidance, but the medical business is quite stable and doing quite well, actually, growing nicely. .

是的。有一些設備公司受起伏的影響更大。我們只受到了輕微的影響，因為去年的訪問量增加了很多，因為 - 今年年初因為它是 COVID 還是流感，不同種類的流感。但我們當時的收入相當高，但我認為隨著時間的推移，情況會開始好轉。當你真正拿出測試時，我們的業務繼續穩定。我會說 PPE 是——我們現在已經很正常化了。但顯然，針對 COVID 的測試正在下降。我不知道這是否會繼續下去。我們已盡力為您提供最佳指導，但醫療業務非常穩定，而且表現良好，實際上增長良好。 .

And the next question comes from the line of Jeff Johnson with Baird.

下一個問題來自 Jeff Johnson 與 Baird 的對話。

Let me start, I guess, just to see if I can get any more color out of you Ron or Stanley, on the specialty business, the 4.5% growth in the quarter year-over-year. One, did that get the benefit, the same 2-point benefit from the timing? Just wondering on that. But more importantly, it sounds like you said, I think, Ron, endo was up high-single digits. If I kind of assume away the ortho business, which I know is growing in the Clear Aligner space, but it's still probably the smallest of the 3. Would that put implants closer to flat year-over-year in the quarter? Just trying to kind of gauge between those 3 business lines within the specialty business.

讓我開始吧，我想，只是想看看我是否能從你 Ron 或 Stanley 那裡得到更多關於專業業務的顏色，即本季度同比增長 4.5%。第一，那是否從時機中獲得了好處，同樣的 2 點好處？只是想知道。但更重要的是，這聽起來就像你說的，我認為，Ron，endo 上升了高個位數。如果我有點假設矯正業務，我知道它在 Clear Aligner 領域正在增長，但它可能仍然是 3 個中最小的。這會使植入物在本季度同比接近持平嗎？只是試圖在專業業務中的這 3 條業務線之間進行衡量。

I think on the implant, it's really -- you got to look at the kind of the specific markets. Like we were saying before, in Europe, our implant business grew quite well, actually grew about double digits. And in the U.S. we had growth, but it was much more tepid than that. It was just a click of growth that we got in the U.S. But again, the U.S. was coming off, I think, a much tougher comp than what we had in Europe last year. Yes, endo has been -- that's been steady. I mean endo quarter-to-quarter has been steady in that mid- to high-single digits. Ortho is really hard for us to pick out a trend. It's just such a low base for us that we have had some -- we felt like we had very good growth in Clear Aligners in the quarter. That's mostly through our relationship with some DSOs there, but it's still off a very low base. .

我認為在植入物上，它真的——你必須看看特定市場的類型。就像我們之前說的，在歐洲，我們的植入業務增長得很好，實際上增長了兩位數。在美國，我們有增長，但比那更不溫不火。這只是我們在美國獲得的增長的一點點。但我認為，美國再次出現，比我們去年在歐洲的表現要強得多。是的，遠藤一直——一直很穩定。我的意思是 endo 季度環比一直穩定在中高個位數。 Ortho 對我們來說真的很難挑出趨勢。對我們來說，基數如此之低，以至於我們有一些——我們覺得本季度我們在 Clear Aligners 方面的增長非常好。這主要是通過我們與那裡的一些 DSO 的關係，但它的基數仍然很低。 .

All right. And I guess just to help me out here, if U.S. was kind of flat to up a bit in implants, Europe up strongly. I think you said upper-single digits and endo up high-single digits. I mean your Camlog business in Germany, obviously, the #1, #2 player there is a big business. I would think that means your Global Implants were somewhere at least kind of 3% to 4% and endo high-single digits, how does the whole specialty business end up just 4.4%? I still can't reconcile that math. .

好的。我想這只是為了幫助我，如果美國在植入物方面有點持平，那麼歐洲就會強勁增長。我想你說的是高個位數，最後是高個位數。我的意思是您在德國的 Camlog 業務，顯然，那裡的 #1、#2 播放器是一項大業務。我認為這意味著您的全球植入物至少在 3% 到 4% 左右，而且是高個位數，整個專業業務如何最終只達到 4.4%？我仍然無法調和那個數學。 .

Well, I think that keep in mind, implants are about 60% of that category, right? So they carry the most weight when doing that math. And while ortho -- while they had decent sales, ortho is about 10% of that category, endo being the balance of the 30%. So I think that it's the -- you're right. I mean, the implants had about a 3% to 4% global growth, and then that tends to drive the overall number because of the weighting of them in the -- within the category. .

好吧，我認為請記住，植入物大約佔該類別的 60%，對嗎？因此，在進行該計算時，它們的權重最大。雖然 ortho - 雖然他們有不錯的銷售，但 ortho 大約佔該類別的 10%，endo 是 30% 的餘額。所以我認為這是——你是對的。我的意思是，植入物在全球範圍內增長了大約 3% 到 4%，然後由於它們在類別中的權重，這往往會推動總體數量。 .

Fair enough. And then just one clarifying question on the model. So when you started excluding amortization, at the start of this year on deals, you don't include -- or don't exclude, I'm sorry, any kind of inventory step even if you have to go and do some restructuring yourself, that stuff stays in your model. So those are costs on future deals that we'd assume to stay in the EPS, we don't exclude those, just to clarify that. .

很公平。然後只有一個關於模型的澄清問題。因此，當你開始排除攤銷時，在今年年初的交易中，你不包括 - 或者不排除，對不起，任何類型的庫存步驟，即使你必須自己去做一些重組，那些東西留在你的模型中。因此，這些是我們假設保留在 EPS 中的未來交易成本，我們不排除這些，只是為了澄清這一點。 .

Yes.Well, let's clarify your question, though, because inventory step-up will be -- is very different from restructuring, right? So to the extent we have to incur restructuring costs in our transactions, as we incur those restructuring costs, we will add them back. Inventory step-up, we will reference inventory step-up. So people are aware of the impact it will have on earnings, but we are not adding back inventory step-up as a non-GAAP adjustment, nor are we adding back the costs we incur when doing our deals. We see it as an integral part of our business, acquisitions is a very important part of our strategy and the costs we incur doing the deals, we do not add back as non-GAAP adjustments. But when we have a quarter such as this quarter, when we have an unusually high volume of acquisition expenses, we want to make sure we reference it, so people understand the impact it has on operating income as it is a component of operating expense. .

是的。不過，讓我們澄清一下你的問題，因為庫存增加將與重組有很大不同，對吧？因此，就我們必須在交易中承擔重組成本而言，當我們承擔這些重組成本時，我們將把它們加回去。庫存升壓，我們將參考庫存升壓。因此，人們意識到這將對收益產生影響，但我們不會將庫存增加作為非 GAAP 調整，也不會增加我們在進行交易時產生的成本。我們將其視為我們業務不可或缺的一部分，收購是我們戰略的一個非常重要的部分，我們在交易中產生的成本，我們不會作為非 GAAP 調整加回去。但是當我們有一個季度，比如這個季度，當我們有異常高的收購費用時，我們希望確保我們引用它，所以人們了解它對營業收入的影響，因為它是營業費用的一個組成部分。 .

Jeff, just to be clear, our North American implants sales were flattish, and that's because we had significant growth last year. Our implant business outside of the United States, outside North America had high-single-digit growth.

傑夫，需要明確的是，我們在北美的植入物銷售額持平，這是因為我們去年取得了顯著增長。我們在美國以外、北美以外的植入業務實現了高個位數增長。

And the next question comes from the line of Jon Block with Stifel.

下一個問題來自 Jon Block 與 Stifel 的對話。

Stanley, maybe for you, just any more details on the U.S. Hi-Tech equipment environment. I know you had some commentary. But maybe at a high level, what's working well and less well. And then the pricing pressure in IOS? I'm just curious, I feel like that's been going on for a couple of quarters now. So I get it. It's a year-over-year headwind, but has that stabilized of late and it is starting to level off the pricing pressure more Q-over-Q? .

斯坦利，也許對你來說，只是關於美國高科技設備環境的更多細節。我知道你有一些評論。但也許在高層次上，什麼運作良好，什麼運作不佳。然後是 IOS 的定價壓力？我只是好奇，我覺得這已經持續了幾個季度了。所以我明白了。這是一個同比逆風，但最近是否穩定下來，並且開始以 Q-over-Q 的速度降低定價壓力？ .

A very good question. I'm glad that was asked. Yes. I think the year-over-year pricing on intra-oral scanners or IOS has stabilized. When you look at our numbers, you will see that IOS sales in units went up quite nicely in the first quarter. What was down was the DSO business because we had some significant sales in IOS in the first quarter of 2022. So I would say the IOS units are good, the pricing has stabilized. And I think the mills now have also stabilized. Of course, the 3D printing is being viewed at as an option. But I think we've gotten back some momentum in the mills and expect to do well with the 3D printing for the remainder of the year as well.

一個很好的問題。我很高興被問到。是的。我認為口腔內掃描儀或 IOS 的同比定價已經穩定。當您查看我們的數據時，您會發現第一季度 IOS 銷量增長相當不錯。下降的是 DSO 業務，因為我們在 2022 年第一季度在 IOS 上有一些可觀的銷售。所以我想說 IOS 單元很好，價格已經穩定。而且我認為工廠現在也已經穩定下來。當然，3D 打印被視為一種選擇。但我認為我們已經在工廠恢復了一些勢頭，並期望在今年剩餘時間裡也能在 3D 打印方面做得很好。

Great. And then the second one is just a quick clarification. Ron, the revenue guide unchanged, I believe, reported. So COVID comes down. I don't know your exact FX assumption. Biotech comes in. Sometimes, there's other small little deals. But I guess just to clarify, did anything change organic maybe to help offset the COVID sales step down? Or is that just Biotech and some other nickels and dimes? .

偉大的。然後第二個只是一個快速的澄清。羅恩，收入指南不變，我相信，報告。所以 COVID 下來了。我不知道你確切的外匯假設。生物技術進來了。有時，還有其他小交易。但我想澄清一下，是否有任何有機變化可能有助於抵消 COVID 銷售下降？還是僅僅是生物技術和其他一些零錢？ .

It's more the latter. It's more that we pick up a little bit of additional acquisition growth. But I think that the -- we still think the core underlying business can grow kind of mid-single digit in sales up towards approaching high-single digits in sales.

更多的是後者。更多的是我們獲得了一些額外的收購增長。但我認為 - 我們仍然認為核心基礎業務的銷售額可以增長到接近高個位數的中個位數。

And the next question comes from the line of Elizabeth Anderson with Evercore ISI.

下一個問題來自 Evercore ISI 的 Elizabeth Anderson。

I appreciate what you -- all the details that you're giving us on sort of the equipment growth in the different categories. It was nice to see on a stack basis that the equipment comps actually improved sequentially. Can you talk about sort of -- for people who are worried about kind of like that continued demand environment? Can you talk about sort of how the backlog stands? I know you've given us some helpful details on that in the past? And then also sort of how has the environment been if we think about the end of the quarter and maybe into April, if you can comment? .

我很感激你——你給我們提供的關於不同類別設備增長的所有細節。很高興在堆棧基礎上看到設備組合實際上是按順序改進的。你能談談——對於那些擔心那種持續需求環境的人嗎？你能談談積壓的情況嗎？我知道你過去給過我們一些有用的細節嗎？如果您可以發表評論，那麼如果我們考慮本季度末甚至可能進入 4 月，那麼環境如何？ .

Yes, certainly, Elizabeth. I think with reference to the backlog, I mean, during the quarter, we actually saw a bit of a tick down in backlog sequentially, but the backlog at the end of the first quarter this year is still greater than the backlog at the end of the year last year. And it's still quite a bit higher than the backlog levels we had pre-pandemic. And that is principally traditional equipment, right? And so that's helping with the growth and gives us, I think, some optimism in terms of our ability to continue to sell traditional equipment at pretty good growth rates going forward. Now that's in North America. Internationally, we've seen the backlog come down a little bit. And -- but it still is ahead of pre-pandemic levels. So while the backlogs are working down a little bit more internationally, there's still a fairly healthy backlog there.

是的，當然，伊麗莎白。我認為關於積壓，我的意思是，在本季度，我們實際上看到積壓連續出現了一點點下降，但今年第一季度末的積壓仍大於第一季度末的積壓去年的一年。而且它仍然比我們在大流行前的積壓水平高很多。那主要是傳統設備，對嗎？因此，這有助於增長，我認為，就我們繼續以相當不錯的增長率繼續銷售傳統設備的能力而言，我們感到樂觀。現在是在北美。在國際上，我們已經看到積壓的訂單有所減少。而且 - 但它仍然領先於大流行前的水平。因此，儘管國際上的積壓工作有所減少，但那裡的積壓工作仍然相當健康。

Okay. And sorry. And just in terms of the comment of how sort of the end of March, if you can comment on April, trended sort of post some of the recent financial turmoil?

好的。對不起。就 3 月底的評論而言，如果你能對 4 月發表評論，那麼最近的一些金融動盪趨勢如何？

You said -- I'm sorry, I didn't quite understand what you said at the beginning of that, Elizabeth.

你說——對不起，我不太明白你一開始說的話，伊麗莎白。

Sorry. So I was just talking about if you could comment on sort of the demand environment in equipment. If we think about the end of March post the start of some of the financial turmoil. And if you could talk about April as well, if that's possible?

對不起。所以我只是在談論你是否可以評論設備的需求環境。如果我們考慮一下金融風暴開始後的 3 月底。如果你也可以談談四月，如果可能的話？

Yes. I think the trends we have in April have been really a continuation of what we saw in the first quarter. I wouldn't say there's been anything that's coming out of the financial markets. That's been a significant disruptor to that. .

是的。我認為我們 4 月份的趨勢實際上是我們在第一季度看到的趨勢的延續。我不會說金融市場有什麼變化。這是一個重大的破壞者。 .

And the next question comes from the line of Kevin Caliendo with UBS.

下一個問題來自瑞銀的 Kevin Caliendo。

In the context of just the cadence, if you had this benefit in Q1, is there any falloff at the end of the year or anything else we should contemplate? And just thinking about cadence in terms of earnings for the year, any color or guidance you can provide us?

在節奏的背景下，如果你在第一季度有這個好處，年底是否有任何衰減或我們應該考慮的其他事情？僅考慮當年收入的節奏，您可以為我們提供任何顏色或指導嗎？

Kevin, when you say benefit in Q1, can you be more specific which benefits?

凱文，當你在 Q1 中說到好處時，你能更具體地說明哪些好處嗎？

Oh, I'm sorry, the calendar benefit. Is there any fall off in Q4, anything that we should think about the rest of the year from a calendar perspective that might be off or different...

哦，對不起，日曆福利。第 4 季度是否有任何下降，我們應該從日曆的角度考慮今年剩餘時間的任何事情可能會發生或不同......

No, I don't think -- I think the balance of the year should be -- other than the fact that our Q4 this year will be 13 weeks versus 14 weeks last year, right? But outside of that, I don't expect the calendar to have a significant effect on the cadence. I do think where you could see some lumpiness still in our quarterly numbers is that the headwinds that we are dealing with as it relates to PPE and COVID test kits are more pronounced in the first half of the year than they are in the second half of the year and most pronounced in the first quarter as was evidenced by the $0.24 headwind we reported this quarter. But that headwind will be greater, just the math of it is that, that headwind will be greater in the second quarter than it is in the third and the fourth quarter. So we'll continue to have a little bit of a hill to climb in Q2 that we think levels off for us as we get into Q3 and Q4.

不，我不認為 - 我認為今年的餘額應該 - 除了我們今年第四季度將是 13 周而不是去年的 14 週，對嗎？但除此之外，我不認為日曆會對節奏產生重大影響。我確實認為你可以在我們的季度數據中看到一些不一致的地方，因為我們正在處理的與 PPE 和 COVID 測試套件相關的逆風在今年上半年比下半年更為明顯今年第一季度最為明顯，我們本季度報告的 0.24 美元逆風就證明了這一點。但逆風會更大，從數學上來說，第二季度的逆風會比第三和第四季度更大。因此，我們將在第二季度繼續爬上一點小山，我們認為隨著我們進入第三季度和第四季度，我們會平穩下來。

And just a follow-up on the backlog question, if I just want to make sure I understand. Is backlog like quarter-over-quarter flat or down on the equipment side? And would that be related to core equipment or digital equipment? Like how should we think about that?

如果我只是想確保我理解的話，只是關於積壓問題的後續行動。設備方面的積壓訂單是環比持平還是下降？那會不會與核心設備或數字設備有關？比如我們應該如何考慮？

The backlog is principally standard equipment, right? So it's chairs, units and lights, and we really kind of analyze it more sequentially what was it at the beginning of the quarter versus the end of the quarter. And that's what I was saying before that the North American equipment backlog remains -- it did come down some over the course of the quarter, but it's higher than where it was last year at the end of the first quarter. So it's still a fairly healthy backlog and well higher than where the kind of backlog levels we had prior to the pandemic. Internationally is kind of the same story. We're seeing a bit of a work down quarter-to-quarter. But their backlog versus last year's first quarter is also a little lower. And that's how it differs from North America. .

積壓的主要是標准設備，對吧？所以它是椅子、單元和燈，我們真的更順序地分析了它在本季度初和本季度末的情況。這就是我之前所說的北美設備積壓仍然存在——在本季度確實有所下降，但高於去年第一季度末的水平。因此，它仍然是一個相當健康的積壓，並且遠高於我們在大流行之前的那種積壓水平。在國際上也是如此。我們看到每個季度都有一些工作減少。但與去年第一季度相比，他們的積壓訂單也略有減少。這就是它與北美的不同之處。 .

And we also think that the digital side from a pricing point of view has stabilized, and we're seeing good growth on the units.

而且我們還認為，從定價的角度來看，數字方面已經穩定下來，我們看到了單位的良好增長。

And the next question comes from the line of Brandon Vazquez with William Blair.

下一個問題來自 Brandon Vazquez 和 William Blair 的對話。

I'll just ask both of them upfront since they're somewhat related. The first is just you guys have obviously been more acquisitive, curious if there's any notable pipeline or -- sorry, any notable gaps in your portfolio that you're kind of focused on going forward from an M&A standpoint? And the follow-up kind of related question is, as you become more acquisitive and I'm looking at Biotech Dental, for example, there might be areas where you have a little bit of overlap in portfolio, right? You have a Reveal and now you have another Clear Aligner. What's kind of the thought process do you kind of keep both of those running separately? Do you combine them into one brand to a greater efficiency as it grows? Curious your thoughts on integrating businesses like that. .

我會先問他們兩個，因為他們有些相關。首先是你們顯然更積極，好奇是否有任何值得注意的管道，或者 - 抱歉，您的投資組合中是否有任何明顯的差距，您正在專注於從併購的角度向前推進？後續的相關問題是，隨著你變得更加貪婪，我正在研究 Biotech Dental，例如，在某些領域你的投資組合可能會有一些重疊，對吧？您有一個 Reveal，現在您有另一個 Clear Aligner。您讓這兩個單獨運行的思維過程是什麼樣的？隨著品牌的發展，您是否將它們合併為一個品牌以提高效率？好奇你對整合這樣的業務的想法。 .

Brandon, thank you for that question. As we indicated early on, our pipeline remains quite good. Our bold strategic plan calls for us to continue to advance those businesses that are high margin, high growth through organic growth and through acquisition growth. There are parts of the portfolio that we could add to, of course. I don't think we have much overlap. But we are very much committed to advancing our high-growth, high-margin businesses, and there's no deviation from that. We outlined that quite clearly in our Investor Day, and we're executing.

布蘭登，謝謝你提出這個問題。正如我們早先指出的那樣，我們的管道仍然非常好。我們大膽的戰略計劃要求我們通過有機增長和收購增長繼續推進那些高利潤、高增長的業務。當然，我們可以添加部分投資組合。我認為我們沒有太多重疊。但我們非常致力於推進我們的高增長、高利潤業務，並且沒有偏離這一點。我們在投資者日中非常清楚地概述了這一點，並且我們正在執行。

As it relates to brand alignment, I think we've always been pretty good at that. We will, over time, align brands. We've done that with Camlog and BioHorizons, I think, quite well. We never lost any business when we aligned the brands. We have a combined BioHorizons Camlog brand today in many parts of the world, certainly all the big markets and a few parts of the world where each of the particular brands is distributed through different distributors. We may keep it. But generally, in the big market, we keep them separate in the big markets, we're aligning -- have aligned for the last 2 or 3 years in a single brand. We will keep both the line of brands going. It goes to different markets. But I would imagine, over time, we will align brands. But more important, we're aligning the production, all the administrative activity, which should be accretive, of course. So we are very, very careful with brand alignment. We've done a good job of that over the years, and we'll continue to do that.

由於它與品牌一致性有關，我認為我們在這方面一直做得很好。隨著時間的推移，我們將調整品牌。我認為，我們已經通過 Camlog 和 BioHorizons 做到了這一點，做得很好。當我們調整品牌時，我們從未失去任何業務。今天，我們在世界許多地方擁有一個組合的 BioHorizons Camlog 品牌，當然是所有大市場和世界上每個特定品牌都通過不同分銷商分銷的少數地區。我們可以保留它。但總的來說，在大市場中，我們將它們在大市場中分開，我們正在調整——在過去的 2 或 3 年裡在一個品牌中保持一致。我們將繼續保持這兩個品牌系列。它進入不同的市場。但我想，隨著時間的推移，我們將調整品牌。但更重要的是，我們正在調整生產，所有的行政活動，這當然應該是增值的。所以我們在品牌調整方面非常非常小心。多年來我們在這方面做得很好，我們將繼續這樣做。

We have time for one last question coming from the line of Erin Wright with Morgan Stanley.

我們有時間回答 Erin Wright 與 Morgan Stanley 的最後一個問題。

I just have one question here on the DSO side. Are there any anticipated changes in DSO relationships in the 2023 guide? And have you been -- or how have you been performing across the DSO market segment? And any growth rates you can give us across that segment that you're seeing? And anything to call out there?

我在 DSO 方面只有一個問題。 2023 年指南中 DSO 關係是否有任何預期變化？你有沒有 - 或者你在 DSO 細分市場中的表現如何？您可以在您看到的那個細分市場中為我們提供任何增長率嗎？有什麼要說的嗎？

Yes. That's a good question also. Our DSO business remains a good grower. It's pretty stable. We've continued to add DSOs specifically in the mid-market area. A couple of our larger DSO customers have made some good acquisitions and taken us along and included our -- the purchases of products from us. I think we're making good progress on the specialty side in the DSO world. Of course, on the equipment side, it can be lumpy. I mentioned earlier on that on the IOS side, we had a very good significant sale in the first quarter of last year.

是的。這也是個好問題。我們的 DSO 業務仍然是一個很好的種植者。它非常穩定。我們繼續專門在中端市場領域添加 DSO。我們的幾個較大的 DSO 客戶已經進行了一些不錯的收購，並帶我們一起並包括我們 - 從我們那裡購買產品。我認為我們在 DSO 領域的專業方面取得了良好進展。當然，在設備方面，它可能是一團糟。我之前提到過，在 IOS 方面，我們在去年第一季度的銷售額非常可觀。

So it impacted us in terms of units a bit. That will occur. I don't think we've lost any, I'm sure we've lost some smaller ones, but I think, on the big side, we're doing well. And on the midsized ones we're gaining as well customers. So overall, it's a growing business. And of course, the goal is to advance the high-growth, high-margin products, specifically our software, where I think we are appreciated and our additional value-added services. So the growth continues quite nicely, is pretty stable, and we have very good relations with our large and midsized DSOs.

所以它在單位方面對我們產生了一些影響。那將會發生。我認為我們沒有失去任何東西，我敢肯定我們失去了一些較小的東西，但我認為，從大的方面來看，我們做得很好。在中型飛機上，我們也獲得了客戶。所以總的來說，這是一個不斷增長的業務。當然，我們的目標是推進高增長、高利潤的產品，特別是我們的軟件，我認為我們在這些方面受到讚賞，以及我們的附加增值服務。因此，增長繼續非常好，非常穩定，我們與大中型 DSO 的關係非常好。

Okay. So thank you, everyone, for calling in. I realize there are a couple of complexities in this quarter. But if you peel out the PPE and the tests and you understand that the accounting regime for acquisitions on inventory step-up takes those expenses relating to the step-up and runs them through the operating income against operating income, likewise, some M&A expenses are run through operating income. If you take all of that out, you'll see our core business is doing quite well, good internal sales growth. Gross profit is doing quite well, moving it a bit higher, (inaudible) with our strategic plan. And I think you will see that the business is quite stable. We anticipate operating income to continue to grow as Ron outlined in our guidance. and we're happy with the business.

好的。所以謝謝大家的來電。我意識到這個季度有幾個複雜的問題。但是，如果你剝離 PPE 和測試，並且你了解庫存增加收購的會計製度將這些與增加有關的費用計算在營業收入與營業收入之間，同樣，一些併購費用是貫穿營業收入。如果你把所有這些都去掉，你會發現我們的核心業務做得很好，內部銷售增長良好。毛利潤表現不錯，根據我們的戰略計劃，（聽不清）略高。而且我認為您會看到業務非常穩定。正如 Ron 在我們的指南中概述的那樣，我們預計營業收入將繼續增長。我們對這項業務很滿意。

So of course, if you have questions, Graham and Ron are available. And we're optimistic about the business. So I appreciate all the questions and look forward to our next call in a couple of months' time. And I think we're going to be at some conferences and happy to provide more color on the business. But overall, we're very pleased with the performance of the business and nothing really unexpected at this time. So thank you very much.

當然，如果您有任何疑問，可以聯繫 Graham 和 Ron。我們對這項業務持樂觀態度。因此，我感謝所有問題，並期待我們在幾個月後的下一次電話會議。而且我認為我們將參加一些會議，並樂於為業務提供更多色彩。但總的來說，我們對業務表現非常滿意，目前沒有什麼特別意外的。非常感謝。

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a great day.

今天的電話會議到此結束。此時您可以斷開線路。感謝您的參與，祝您有美好的一天。