Integer Holdings Corp (ITGR) 2023 Q2 法說會逐字稿

Hello. My name is Jeremy, and I will be the conference operator today. At this time, I would like to welcome everyone to the Integer Holdings Corporation Conference Call. (Operator Instructions)

你好。我叫傑里米，今天我將擔任會議主持人。此時此刻，我歡迎大家參加 Integer Holdings Corporation 電話會議。 （操作員說明）

I would now like to introduce you to your speaker, Andrew Senn, Senior Vice President of Strategy, Business Development and Investor Relations. Andrew, you may begin.

現在我想向您介紹演講者安德魯·森 (Andrew Senn)，他是戰略、業務開發和投資者關係高級副總裁。安德魯，你可以開始了。

Good morning, everyone. Thank you for joining us, and welcome to Integer's Second Quarter 2023 Earnings Conference Call. With me today are Joe Dziedzic, President and Chief Executive Officer; and Diron Smith, Vice President, Financial Planning and Analysis and Interim Chief Financial Officer.

大家，早安。感謝您加入我們，歡迎參加 Integer 2023 年第二季度收益電話會議。今天與我在一起的有總裁兼首席執行官 Joe Dziedzic； Diron Smith，財務規劃與分析副總裁兼臨時首席財務官。

As a reminder, the results and the data we discuss today reflect the consolidated results of Integer for the periods indicated. During our call, we will discuss some non-GAAP financial measures. For a reconciliation of these non-GAAP financial measures, please refer to the appendix of today's presentation, today's earnings press release and the trending schedules, which are available on our website at integer.net.

提醒一下，我們今天討論的結果和數據反映了 Integer 在所示期間的綜合結果。在電話會議中，我們將討論一些非公認會計準則財務指標。有關這些非 GAAP 財務指標的調節表，請參閱今天演示文稿的附錄、今天的收益新聞稿和趨勢表，這些內容可在我們的網站 integer.net 上找到。

Please note that today's presentation includes forward-looking statements. Please refer to the company's SEC filings for a discussion of the risk factors that could cause our actual results to differ materially.

請注意，今天的演示包含前瞻性陳述。請參閱該公司向 SEC 提交的文件，了解可能導致我們的實際結果出現重大差異的風險因素的討論。

On today's call, Joe will provide his opening comments and Diron will then review our financial results for the second quarter of 2023 and provide an update on our full year 2023 guidance. Joe will come back to provide his closing remarks, and then we will open up the call for your questions.

在今天的電話會議上，Joe 將發表開場評論，Diron 隨後將審查我們 2023 年第二季度的財務業績，並提供 2023 年全年指導的最新信息。喬將回來發表結束語，然後我們將開始電話詢問您的問題。

With that, I will turn the call over to Joe.

這樣，我就把電話轉給喬。

Thank you, Andrew, and thank you to everyone for joining the call today. In addition to KeyBanc, Benchmark, Piper Sandler and Bank of America, we are excited to welcome sell-side analysts from Citi and Wells Fargo, who initiated coverage on Integer during the second quarter. We appreciate the coverage from all the sell-side analysts and are excited by the opportunity to reach more potential investors.

謝謝你，安德魯，也感謝大家今天加入電話會議。除了 KeyBanc、Benchmark、Piper Sandler 和美國銀行之外，我們還很高興地歡迎來自花旗和富國銀行的賣方分析師，他們在第二季度開始對 Integer 進行研究。我們感謝所有賣方分析師的報導，並對有機會接觸更多潛在投資者感到興奮。

In the second quarter, we delivered another strong quarter of year-over-year results. Sales grew 14% organically from robust customer demand across all product lines. Our adjusted operating income grew 20%, while expanding margins by about 80 basis points compared to last year. We were able to deliver more products to our customers than our prior guidance assumed due to a meaningful improvement in the supply chain environment as well as a stabilizing labor market.

在第二季度，我們再次實現了同比強勁的季度業績。由於所有產品線的強勁客戶需求，銷售額有機增長了 14%。與去年相比，我們調整後的營業收入增長了 20%，同時利潤率擴大了約 80 個基點。由於供應鏈環境的顯著改善以及勞動力市場的穩定，我們能夠向客戶提供比之前預期更多的產品。

We are encouraged by the significant supply chain improvement However, we continue to experience pockets of supply chain risk.

我們對供應鏈的顯著改善感到鼓舞。然而，我們仍然面臨著供應鏈風險。

Based on continued strong customer demand and the improvements in supply chain and labor, we are raising our full year outlook. We expect sales to grow 11% to 13% and adjusted operating income to grow 17% to 21% year-over-year. Free cash flow guidance is now a range of $75 million to $95 million, a strong year-over-year increase. The strategy that we developed in 2017 and began implementing in 2018 is producing above-market sales growth with a pipeline to sustain growth at 200 basis points above the market.

基於持續強勁的客戶需求以及供應鍊和勞動力的改善，我們上調了全年展望。我們預計銷售額將同比增長 11% 至 13%，調整後營業收入將同比增長 17% 至 21%。自由現金流指引目前在 7500 萬美元至 9500 萬美元之間，同比強勁增長。我們於 2017 年制定並於 2018 年開始實施的戰略是實現高於市場的銷售增長，並有渠道維持高於市場 200 個基點的增長。

In 2023, we expect to grow operating income at 1.6x the rate of sales growth. We remain confident we can achieve our strategic financial objective of growing operating income at 2x the rate of sales growth through the execution of our manufacturing excellence strategies and when the supply chain and labor environment more fully stabilized.

到 2023 年，我們預計營業收入的增長速度是銷售增長率的 1.6 倍。我們仍然有信心，通過執行我們的卓越製造戰略，並且當供應鍊和勞動力環境更加完全穩定時，我們能夠實現營業收入以銷售增長率兩倍的速度增長的戰略財務目標。

It is an exciting time at Integer because demand remains incredibly strong. We have a robust pipeline of new products concentrated in faster-growing end markets, and we are making the investments needed to deliver sustained growth.

對於 Integer 來說，這是一個激動人心的時刻，因為需求仍然非常強勁。我們擁有強大的新產品系列，集中在增長較快的終端市場，並且我們正在進行實現持續增長所需的投資。

I am grateful for our associates around the world that are delivering for our customers and making a difference for patients.

我感謝我們世界各地的員工為我們的客戶提供服務並為患者帶來改變。

I'll now turn the call over to Diron.

我現在將把電話轉給 Diron。

Thank you, Joe. Good morning, everyone, and thank you again for joining today's discussion. I'll provide more details on our second quarter 2023 financial results and provide an update on our 2023 outlook.

謝謝你，喬。大家早上好，再次感謝大家參加今天的討論。我將提供有關 2023 年第二季度財務業績的更多詳細信息，並提供 2023 年展望的最新信息。

In the second quarter, we continued our strong start to 2023 with sales of $400 million, Integer delivered 14% year-over-year sales growth on both a reported and an organic basis, which excludes the impact of currency fluctuations.

第二季度，我們繼續保持 2023 年的強勁開局，銷售額達 4 億美元，報告銷售額和有機銷售額同比增長 14%，其中排除了貨幣波動的影響。

Our sales performance reflects the continued strong customer demand across all product lines and the meaningful improvements in supply chain and direct labor.

我們的銷售業績反映了所有產品線持續強勁的客戶需求以及供應鍊和直接勞動力的有意義的改進。

We delivered $76 million of adjusted EBITDA, up $10 million compared to last year or an increase of 16%.

我們實現了 7600 萬美元的調整後 EBITDA，比去年增加了 1000 萬美元，增幅為 16%。

Adjusted operating income was up 20% or $10 million versus last year as we continue to make progress on our year-over-year margin expansion. Adjusted operating income as a percent of sales increased by 76 basis points since the prior year to 15%, driven by operational efficiency improvements, offsetting material inflation and annual merit increases.

隨著我們繼續在同比利潤率擴張方面取得進展，調整後營業收入比去年增長了 20%，即 1000 萬美元。受運營效率提高、抵消物質通脹和年度績效增長的推動，調整後營業收入佔銷售額的百分比較上一年增加了 76 個基點，達到 15%。

With adjusted net income at $38 million, we delivered $1.14 of adjusted diluted earnings per share, up $0.10 or 10% from the second quarter of 2022, benefiting from the lower fixed interest convertible notes issued in January of this year. I will share a bit more detail on the year-over-year growth and adjusted net income in a few moments.

調整後淨利潤為 3800 萬美元，調整後稀釋每股收益為 1.14 美元，較 2022 年第二季度增長 0.10 美元，即 10%，受益於今年 1 月發行的固定利率可轉換票據較低。我稍後將分享有關同比增長和調整後淨利潤的更多細節。

In the second quarter of 2023, sales for all 4 product lines delivered strong year-over-year growth due to strong customer demand and improvements in the supply chain. The Cardio & Vascular product line delivered 15% sales growth in the second quarter compared to a year ago. Continued strong demand across all markets, growth in key products such as guide-wires, new product ramps in electrophysiology and supply chain improvements were drivers of the strong performance.

2023年第二季度，由於強勁的客戶需求和供應鏈的改善，所有4個產品線的銷售額均實現了同比強勁增長。心血管產品線第二季度銷售額同比增長 15%。所有市場的持續強勁需求、導絲等關鍵產品的增長、電生理學新產品的增加以及供應鏈的改進是強勁業績的推動因素。

Cardiac Rhythm Management and Neuro-modulation second quarter sales increased 13% over the second quarter of 2022, with double-digit growth in both cardiac rhythm management and in neuromodulation. This was driven by strong demand, including double-digit growth from emerging customers with PMA products and supply chain improvements.

心律管理和神經調節第二季度銷售額比 2022 年第二季度增長 13%，心律管理和神經調節業務均實現兩位數增長。這是由強勁需求推動的，包括 PMA 產品新興客戶的兩位數增長和供應鏈的改進。

Advanced Surgical, Orthopedics and Portable Medical saw 17% growth in the second quarter versus a year ago, driven by increased price and demand as a result of the continued execution of the multiyear portable medical exit announced in 2022.

由於繼續執行 2022 年宣布的多年期便攜式醫療退出，價格和需求增加，推動先進外科、骨科和便攜式醫療第二季度同比增長 17%。

Additionally, Advanced Surgical and Orthopedics grew low single digit year-over-year.

此外，高級外科和骨科業務同比增長幅度較低。

And lastly, Electrochem, our Non-Medical segment grew 7% from a year ago, driven by strong demand in military and environmental market segments, partially offset by a decline in the energy market. Further product line details are included in the appendix of the presentation on our website at integer.net.

最後，在軍事和環境市場強勁需求的推動下，我們的非醫療部門電化學業務較上年同期增長了 7%，但部分被能源市場的下滑所抵消。更多產品線詳細信息包含在我們網站 integer.net 上演示文稿的附錄中。

Second quarter 2023 adjusted net income increased a total of $4 million compared to second quarter 2022, primarily due to strong sales and related operational improvements, partially offset by higher interest and taxes.

與 2022 年第二季度相比，2023 年第二季度調整後淨利潤總計增加了 400 萬美元，這主要是由於強勁的銷售和相關運營改進，但部分被利息和稅收的增加所抵消。

In this higher interest rate environment, we incurred interest expense of approximately $4 million or $3 million tax affected more than last year. However, on a sequential basis compared to the first quarter 2023, we reduced our interest expense by $1 million tax effected, driven by the January convertible notes issuance.

在這種較高的利率環境下，我們產生了約 400 萬美元的利息支出，或者比去年多了 300 萬美元的稅收影響。然而，與 2023 年第一季度相比，在 1 月份可轉換票據發行的推動下，我們的利息支出減少了 100 萬美元的稅收影響。

Additionally, the expiration of the 10-year Malaysian tax holiday under which we have been operating is the primary driver of a higher adjusted effective tax rate for second quarter 2023 compared to the prior year.

此外，我們運營的 10 年馬來西亞免稅期到期是 2023 年第二季度調整後有效稅率較上一年更高的主要原因。

In the second quarter 2023, we generated $56 million in cash flow from operations, up $37 million from a year ago. This strong performance is driven by higher sales volumes, improving margins, our effective management of working capital and approximately $20 million from our previously discussed accounts receivable factoring program.

2023 年第二季度，我們的運營現金流量為 5600 萬美元，比去年同期增加 3700 萬美元。這一強勁業績的推動因素包括更高的銷量、不斷提高的利潤率、我們對營運資金的有效管理以及我​​們之前討論的應收賬款保理計劃帶來的約2000 萬美元的收入。

In the second quarter, we generated $23 million in free cash flow, inclusive of $33 million of capital expenditures. With year-to-date capital expenditures of $57 million, we are attracting to our full year guidance of $100 million to $120 million.

第二季度，我們產生了 2300 萬美元的自由現金流，其中包括 3300 萬美元的資本支出。年初至今的資本支出為 5700 萬美元，全年指導目標為 1 億至 1.2 億美元。

Net total debt in the second quarter improved by $15 million sequentially. And as a result, our net total debt leverage at the end of the second quarter was 3.5x our trailing 4 quarter adjusted EBITDA, back within our strategic target range.

第二季度的淨債務總額比上一季度減少了 1500 萬美元。因此，第二季度末我們的淨總債務槓桿率為過去 4 季度調整後 EBITDA 的 3.5 倍，回到了我們的戰略目標範圍內。

We will now transition to providing an update on our full year outlook for 2023 sales, profit and cash. As Joe mentioned in his opening remarks, with strong performance through the first half of 2023 and second quarter supply chain improvements, we are raising our full year 2023 outlook.

我們現在將轉而提供 2023 年全年銷售額、利潤和現金展望的最新信息。正如 Joe 在開場白中提到的那樣，憑藉 2023 年上半年的強勁表現和第二季度供應鏈的改善，我們正在上調 2023 年全年展望。

Starting with sales, we are increasing our outlook to 12% year-over-year growth at midpoint with a sales range of $1.530 billion to $1.550 billion, an increase of 11% to 13% versus last year, up from our previous guidance of 7% to 9%.

從銷售額開始，我們將年增長率預期上調至 12%，銷售額範圍為 15.3 億美元至 15.5 億美元，比去年增長 11% 至 13%，高於我們之前的預期 7 % 至 9%。

Our outlook for 2023 adjusted EBITDA is 15% to 18% growth year-over-year with a range of $294 million to $302 million, up from our previous guidance of 11% to 16% growth.

我們對 2023 年調整後 EBITDA 的預期為同比增長 15% 至 18%，範圍為 2.94 億美元至 3.02 億美元，高於我們之前增長 11% 至 16% 的指導。

We are increasing our adjusted operating income outlook by $11 million at midpoint and expect 2023 adjusted operating income to be between $224 million and $232 million reflecting year-over-year growth of 17% to 21%.

我們將調整後營業收入預期中值上調 1100 萬美元，預計 2023 年調整後營業收入將在 2.24 億美元至 2.32 億美元之間，同比增長 17% 至 21%。

Adjusted net income is now expected to be between $143 million and $149 million, reflecting a year-over-year growth of 10% to 15%. And up from our previous guidance of 4% to 11%. This delivers an expected adjusted EPS outlook between $4.23 and $4.43, a growth of 9% to 14% year-over-year. Our adjusted effective tax rate remains unchanged from our previous outlook and is projected to be between 17% and 19%.

調整後淨利潤目前預計在 1.43 億美元至 1.49 億美元之間，同比增長 10% 至 15%。高於我們之前 4% 至 11% 的指導。這使得調整後每股收益預期在 4.23 美元至 4.43 美元之間，同比增長 9% 至 14%。我們調整後的有效稅率與之前的展望保持不變，預計在 17% 至 19% 之間。

To provide more color into our outlook, our first half 2023 sales averaged $389 million, comprised of an approximately $380 million quarterly run rate plus the recovery of the prior year supply chain delays, which were discussed in our call in April. As we enter the second half of 2023, we expect sales similar to the first half run rate of $380 million. We continue to expect adjusted operating income as a percent of sales to improve throughout the remainder of 2023 as we continue to improve manufacturing efficiencies and operate in a stabilizing direct labor environment.

為了讓我們的前景更加生動，我們2023 年上半年的平均銷售額為3.89 億美元，其中包括約3.8 億美元的季度運行率以及上一年供應鏈延遲的恢復，這在我們4 月份的電話會議中進行了討論。隨著進入 2023 年下半年，我們預計銷售額將與上半年的 3.8 億美元類似。我們繼續預計，隨著我們繼續提高製造效率並在穩定的直接勞動力環境中運營，調整後的營業收入佔銷售額的百分比將在 2023 年剩餘時間內有所改善。

Moving to our 2023 cash outlook. We expect cash flow from operations between $185 million to $205 million, an increase of $5 million from our prior outlook, consistent with our increase in adjusted EBITDA.

轉向我們的 2023 年現金展望。我們預計運營現金流在 1.85 億美元至 2.05 億美元之間，比我們之前的預期增加 500 萬美元，與我們調整後 EBITDA 的增長一致。

Our cash flow from operations outlook includes an expected full year impact of $35 million from accounts receivable factoring to support our Irish manufacturing facility capacity investments, which we shared during our February earnings call.

我們的運營現金流展望包括來自應收賬款保理的預計全年影響 3500 萬美元，以支持我們的愛爾蘭製造設施產能投資，我們在 2 月份的財報電話會議上分享了這一點。

Consistent with our strategy, we are maintaining our outlook on capital expenditures of $100 million to $120 million as we continue to invest in capacity expansion.

根據我們的戰略，隨著我們繼續投資於產能擴張，我們維持 1 億至 1.2 億美元資本支出的預期。

As a result, we expect to generate free cash flow between $75 million and $95 million. The free cash flow generated will be used to reduce our net total debt, and we expect to end the year with our leverage ratio within our target range of 2.5 to 3.5x our trailing 4 quarter adjusted EBITDA.

因此，我們預計將產生 7500 萬至 9500 萬美元的自由現金流。產生的自由現金流將用於減少我們的淨總債務，我們預計到年底我們的槓桿率將保持在過去 4 季度調整後 EBITDA 2.5 至 3.5 倍的目標範圍內。

Thank you for your time, and I'll now turn the call back to Joe.

感謝您抽出時間，我現在將電話轉回給喬。

Thanks, Diron. Integer is on track for a strong year with 22% sales growth in the first quarter and 14% sales growth in the second quarter. Adjusted operating income was up 28% in the first quarter and 20% in the second quarter.

謝謝，迪隆。 Integer 有望迎來強勁的一年，第一季度銷售額增長 22%，第二季度銷售額增長 14%。調整後營業收入第一季度增長 28%，第二季度增長 20%。

We are raising our 2023 outlook as we continue to execute our strategy to deliver sustained above-market growth with expanding margins. We have a strong pipeline of new products and are investing in the capacity to sustain above-market growth. We remain focused on delivering for our customers and the patients they serve to generate a premium valuation for our shareholders.

我們正在上調 2023 年的展望，因為我們將繼續執行戰略，以不斷擴大的利潤率實現持續高於市場的增長。我們擁有強大的新產品儲備，並正在投資能力以維持高於市場的增長。我們仍然專注於為我們的客戶和他們服務的患者提供服務，為我們的股東創造溢價估值。

Thank you for joining our call this morning. I will now turn the call back to our moderator for the Q&A portion of our call.

感謝您今天早上加入我們的電話會議。我現在將把電話轉回給我們的主持人，以進行電話問答部分。

Awesome. Thank you so much. (Operator Instructions) Now it's ready for our first question. Our first question comes from Matthew Mishan.

驚人的。太感謝了。 （操作員說明）現在我們的第一個問題已準備就緒。我們的第一個問題來自馬修·米尚。

I just wanted to start with the drivers of the revenue be -- are you guys seeing -- are you guys just experiencing a level of supply chain relief that's enabling you to pull forward some sales into 2023? Or are just the procedural volume environment like that much better than you thought it would be going into the year? Or are some new products ramping like faster than expected?

我只想從收入的驅動因素開始——你們看到了嗎——你們剛剛經歷了一定程度的供應鏈緩解，這使你們能夠將一些銷售提前到 2023 年嗎？或者僅僅是程序量環境比您想像的今年要好得多？或者一些新產品的增長速度是否比預期更快？

Thank you for the questions. I'll start with the simple answer is we're meeting the procedural demand and volume that our customers have placed on us. We're in no way pulling anything forward. And we -- I'm not convinced that there was necessarily a meaningful increase in demand. We've got really good visibility to the demand for our customers. We've talked about how our backlog is now approaching just right at $1 billion compared to $300 million pre-pandemic, which is a function of lead times being longer across the industry and everybody placing orders further into the future.

謝謝你的提問。我將從簡單的答案開始：我們正在滿足客戶對我們提出的程序要求和數量。我們絕不會推動任何事情向前發展。我不相信需求一定會出現有意義的增長。我們對客戶的需求有很好的了解。我們已經討論過，與大流行前的3 億美元相比，我們的積壓訂單目前已接近10 億美元，這是由於整個行業的交貨時間更長以及每個人都將訂單放在更遠的未來的結果。

The take away is that gives us really good visibility in the next 6 to 9 months. And so the increase in output in the second quarter was very much a function of supply chain improvement. We've talked about how we track supply chain on a daily, weekly basis. We track the number of issues, they quantify the impact.

得出的結論是，這為我們在未來 6 到 9 個月內提供了非常好的能見度。因此，第二季度產量的增長很大程度上是供應鏈改善的結果。我們已經討論瞭如何每天、每週跟踪供應鏈。我們跟踪問題的數量，他們量化影響。

Throughout the quarter, we saw continued improvement and that enabled us to meet more of the demand that we've had. We've been communicating now for 6 to 12 months, we had very strong demand in our backlog, and it's really a function of how much of it can we meet. And our focus has been ensuring that procedure volumes have been meeting procedure volumes.

在整個季度中，我們看到了持續的改進，這使我們能夠滿足更多的需求。我們現在已經溝通了 6 到 12 個月，我們的積壓需求非常強烈，這實際上取決於我們能夠滿足多少需求。我們的重點是確保程序量符合程序量。

But -- so we don't see any of this revenue is coming from the future. We see it as meeting the demand that's been there because supply chain has improved. We did highlight that we still have pockets of supply chain challenges, which we're managing, and we have factored into our second half outlook.

但是——所以我們認為這些收入不會來自未來。我們認為它滿足了現有的需求，因為供應鏈已經改善。我們確實強調，我們仍然面臨一些供應鏈挑戰，我們正在應對這些挑戰，並且我們已將其納入下半年展望中。

Now to get to the other things you asked about, we absolutely have new products from the strong product development pipeline that we've talked about and shared some of our in-process metrics. That pipeline of new products, combined with our emerging customers that we've talked about, and we've highlighted the growth that we've been experiencing there. All of that's contributing to the strong demand that we've been experiencing and had visibility to.

現在，回到您詢問的其他問題，我們絕對從強大的產品開發渠道中獲得了新產品，我們已經討論過並分享了一些流程中的指標。新產品的管道，加上我們已經討論過的新興客戶，我們強調了我們在那裡經歷的增長。所有這些都促成了我們一直在經歷和看到的強勁需求。

But it's really a supply chain that enable us ultimately to get more product out the door in the second quarter. And we had shared or have been sharing over the last 3 months since our last earnings call. The demand is there, and it's really about our ability to continue to improve the supply chain and stabilize direct labor to meet more of it with our customers.

但這確實是一個供應鏈，使我們最終能夠在第二季度推出更多產品。自上次財報電話會議以來，我們在過去 3 個月裡已經分享過或一直在分享。需求是存在的，關鍵在於我們是否有能力繼續改善供應鏈、穩定直接勞動力，以滿足客戶更多的需求。

And so what you're seeing is you're seeing us being able to meet the demand that's been there. And the demand remains strong, and we have confidence in our 12% sales growth at midpoint for the full year.

所以你看到的是我們能夠滿足一直存在的需求。需求依然強勁，我們對全年中點銷售額增長 12% 充滿信心。

All right. And then our next question comes from the line of Matthew O'Brien. Matthew, please go ahead.

好的。我們的下一個問題來自馬修·奧布萊恩。馬修，請繼續。

This is Phil on for Matt. Congrats on a great quarter and thanks for taking our question. (inaudible) but on the updated guide, great to see that it's coming up more than the beat here in Q2, where is that confidence coming from? And what I'm really trying to get at is taking the guide up to, let's say, 12% at the midpoint, and you've indicated your intention is to grow 200 basis points above the market. Do we think about the underlying market this year growing about 10%? Or are you growing above that 200 bps guidance that you set?

這是菲爾替馬特發言。祝賀您度過了一個出色的季度，並感謝您提出我們的問題。 （聽不清）但在更新後的指南中，很高興看到它比第二季度的節奏更快，這種信心來自哪裡？我真正想要達到的目標是將指南的中間值提高到 12%，而您已經表示您的意圖是比市場高出 200 個基點。我們認為今年基礎市場增長約 10% 嗎？或者您的增長速度是否高於您設定的 200 bps 指導值？

Yes. Great question. Thank you. As best we can tell as we look at the industry, we think we're growing more than the 200 basis points above the market this year. We think our ability to meet the strong demand that we've had after working through the supply chain and labor constraints that we're exceeding that 200 basis points this year.

是的。很好的問題。謝謝。從我們對行業的觀察來看，我們認為今年我們的增長速度比市場高出 200 個基點以上。我們認為，在克服供應鍊和勞動力限制後，今年我們滿足強勁需求的能力已超過 200 個基點。

We track our customer sales into the end markets and try to correlate it. We'll see as the year progresses, whether the industry is growing faster than the mid-single digits that our weighted average growth rate based on the markets we sell into would indicate kind of a historical mid-single-digit growth.

我們跟踪終端市場的客戶銷售情況並嘗試將其關聯起來。隨著時間的推移，我們將看到該行業的增長速度是否超過中個位數，我們基於我們銷售的市場的加權平均增長率將表明歷史上中個位數的增長。

But we think we're growing much faster than the market, much faster than the 200 basis points this year. And I would point to the strong product development pipeline we've talked a lot about and those products starting now to become therapies being introduced in the market that's driving additional production, manufacturing revenues for us. I point to the emerging customers that we've talked a fair amount about that are growing from roughly $50 million in 2022 to $80 million to $100 million in 2024. We've talked about that, and so that's also fueling this faster than 200 basis points growth in calendar year 2023.

但我們認為我們的增長速度比市場快得多，比今年的 200 個基點快得多。我想指出我們已經談論了很多的強大的產品開發渠道，這些產品現在開始成為市場上推出的療法，這為我們帶來了額外的生產和製造收入。我指出，我們已經多次討論過的新興客戶的收入將從2022 年的約5000 萬美元增長到2024 年的8000 萬美元到1 億美元。我們已經討論過這一點，因此這也推動了這一速度超過200 的增長2023 年的積分增長。

And your next question might be, well, how do I think about this going forward in 2024 and beyond? We still think the 200 basis points faster than the markets which our estimates the market is mid-single digit, 4% to 6%. So we still think that 200 basis points faster, 6% to 8% organic growth is the right number to think about looking forward. But we've got a really strong year here with tremendous demand that we're fulfilling on. And I do think 12% is well above the 200 basis points in the markets in 2023.

您的下一個問題可能是，我如何看待 2024 年及以後的發展？我們仍然認為 200 個基點的上漲速度比我們估計的市場要快，即 4% 至 6%。因此，我們仍然認為，增長 200 個基點、6% 至 8% 的有機增長是未來考慮的正確數字。但我們今年的表現非常強勁，我們正在滿足巨大的需求。我確實認為 12% 遠高於 2023 年市場的 200 個基點。

All right and then our next question comes from the line of Craig Bijou. Craig, please go ahead.

好吧，我們的下一個問題來自 Craig Bijou。克雷格，請繼續。

Congrats on a strong quarter. I wanted to start with the debt. So obviously, you guys are getting back to your strategic range. Your previous cash flow to further reduce the debt throughout the year. So maybe just talk about kind of your M&A appetite at this point? And if -- with the strong underlying demand that you're seeing, if you think you need to bring on additional capacity either this year or maybe when you look ahead to 24 to meet some of this demand.

祝賀季度表現強勁。我想從債務開始。很明顯，你們正在回到你們的戰略範圍。您之前的現金流進一步減少了全年的債務。那麼，現在可以談談您的併購意願嗎？如果 - 考慮到您所看到的強勁的潛在需求，如果您認為今年或展望 24 日時需要增加額外產能來滿足部分需求。

Craig, thanks for the question. Maybe the quick answer is we remain very committed to our 2.5x to 3.5x leverage. And as you noted, we're at 3.5. So we're right at that spot. We think as we continue to grow EBITDA and we continue to pay down debt, which our free cash flow indicates we will continue doing, that creates capacity.

克雷格，謝謝你的提問。也許最簡單的答案是我們仍然非常致力於 2.5 倍至 3.5 倍的槓桿率。正如您所指出的，我們的分數是 3.5。所以我們就在那個地方。我們認為，隨著我們繼續增長 EBITDA 並繼續償還債務（我們的自由現金流表明我們將繼續這樣做），這會創造產能。

We still think we have between $200 million and $250 million a year on average for acquisition capital. Obviously, at 3.5%, that means in the next, let's say, in the near term, we wouldn't be doing anything substantive or meaningful. But certainly, as that leverage comes down by year-end and starts to get closer to the midpoint or the bottom half of our range that creates a lot more capacity to do acquisitions.

我們仍然認為我們每年平均有 2 億至 2.5 億美元的收購資本。顯然，3.5%意味著在接下來的一段時間裡，我們不會做任何實質性或有意義的事情。但當然，隨著槓桿率到年底下降並開始接近我們範圍的中點或下半部分，這將創造更多的收購能力。

We continue to be very active in the marketplace. We -- the activity is still high. You can see from the transactions that at least have been announced, DuPont acquiring Spectrum at high teens, closer to maybe 18 trailing EBITDA multiple. Memry's -- the acquisition of Memry by Resonetics GTCR is also in that high teens. So see that the best assets, premium assets are still going for what we would characterize as strong multiples, premium multiples below maybe the low 20s where a couple of years ago, you saw some of the best assets trading at.

我們繼續在市場上非常活躍。我們——活動仍然很高。從至少已經宣布的交易中你可以看到，杜邦公司收購 Spectrum 的價格很高，接近 18 倍的追踪 EBITDA 倍數。 Memry's——Resonetics GTCR 對 Memry 的收購也處於十幾歲的時期。因此，請注意，最好的資產、優質資產仍在追求我們所描述的強勁市盈率，溢價市盈率可能低於幾年前的20 倍左右，而幾年前，您會看到一些最佳資產的交易價格。

So when you think about valuations, we still think that premium assets are still trading and being acquired at premium values. We're not looking at those size acquisitions. We've been very clear we're staying at our 2.5 to 3.5x leverage. That puts us in that in $250 million kind of on an annual basis.

因此，當你考慮估值時，我們仍然認為優質資產仍在交易並以溢價收購。我們不考慮這些規模的收購。我們非常明確地表示，我們的槓桿率將維持在 2.5 至 3.5 倍。這意味著我們每年的收入約為 2.5 億美元。

We remain very active in looking for acquisitions that fit within our strategy. And we've been very -- we worked to be very clear about what our strategy is. We have very clear criteria and parameters. We're looking for acquisitions that are more tuck-in, in nature. We're looking for acquisitions that bring additional capability that allows us to accelerate our development work and partnership with our customers in those faster growing end markets.

我們仍然非常積極地尋找符合我們戰略的收購。我們一直非常努力地明確我們的戰略是什麼。我們有非常明確的標準和參數。我們正在尋找本質上更具包容性的收購。我們正在尋找能夠帶來額外能力的收購，使我們能夠加快我們的開發工作以及與那些增長更快的終端市場中的客戶的合作夥伴關係。

You've heard about them many times, structural heart, electrophysiology, neurovascular, neuromodulation, peripheral vascular. That's where our customers are innovating because there's significant patient need. And that's where we're continuing to add capabilities in our manufacturing operations and R&D operations to be able to enable our customer strategy, which we think makes us the partner of choice because we help them accelerate the execution of their strategy.

您已經聽說過很多次了：心臟結構、電生理學、神經血管、神經調節、外周血管。這就是我們的客戶正在創新的地方，因為患者的需求很大。這就是我們繼續增加製造業務和研發業務能力的地方，以便能夠實現我們的客戶戰略，我們認為這使我們成為首選合作夥伴，因為我們幫助他們加快戰略的執行。

So your question about capacity, we've been investing. You see our CapEx this year, which is heavily driven by 2 major expansions in Ireland, one in Galway, one in our New Ross guidewire facility, where we're spending about $40 million this year.

所以你關於產能的問題，我們一直在投資。你可以看到我們今年的資本支出，這在很大程度上是由愛爾蘭的兩項主要擴張推動的，一項在戈爾韋，一項在我們的新羅斯導絲工廠，今年我們在那里花費了約4000 萬美元。

When you step back and look at total Integer, we think we've got somewhere in the neighborhood of 400,000 to 500,000 square feet of available manufacturing space spread across our network. We're obviously adding 80,000 square feet in our guidewire facility in New Ross, we're adding 70,000 square feet of new facility in Galway, Ireland. We've got about 100,000 square feet in the Dominican Republic that we got as part of our acquisition of Oscor.

當您退後一步查看總整數時，我們認為我們在整個網絡中擁有大約 400,000 到 500,000 平方英尺的可用製造空間。顯然，我們在新羅斯的導絲工廠增加了 80,000 平方英尺，在愛爾蘭戈爾韋增加了 70,000 平方英尺的新工廠。作為收購 Oscor 的一部分，我們在多米尼加共和國擁有約 100,000 平方英尺的土地。

We've got capacity at our Tijuana facility. We've got capacity in our other U.S. facilities. So we feel we have capacity to continue growing and to support the level of growth that we're projecting. And 2023 is a year of elevated CapEx spend because of that. Once we get into '24 and beyond, we expect that CapEx to come back down because we don't anticipate the magnitude of facility investments like the Irish facility.

我們的蒂華納工廠有足夠的產能。我們在美國的其他設施也有產能。因此，我們認為我們有能力繼續增長並支持我們預計的增長水平。因此，2023 年是資本支出增加的一年。一旦進入 24 世紀及以後，我們預計資本支出將會回落，因為我們預計愛爾蘭設施等設施投資的規模不會很大。

So we really got the capacity to continue growing. Naturally, you do need the equipment, the capital equipment to build the product. So -- but we've continued to invest in the equipment and feel confident that we've got the growth capacity to support the growth that not only that we're experiencing this year but looking forward.

所以我們確實有能力繼續增長。當然，您確實需要設備、資本設備來構建產品。因此，我們繼續投資設備，並相信我們有足夠的增長能力來支持我們今年和未來的增長。

Okay. (Operator Instructions) Our next question comes from the line of Nathan Treybeck.

好的。 （操作員說明）我們的下一個問題來自 Nathan Treybeck。

In terms of the supply chain improvement, how would you characterize the state of the supply chain and the overall inflation environment relative to Q1 and your expectations for when to normalize? I'm thinking like in terms of your thoughts on getting back to your pre-COVID margins.

在供應鏈改善方面，您如何描述相對於第一季度的供應鏈狀況和整體通脹環境以及您對何時正常化的預期？我的想法類似於您對恢復到新冠疫情前利潤水平的想法。

Nathan, thanks for the question. So we did see a meaningful improvement in supply chain in the second quarter. And we had tried to convey that the demand was there and we were being constrained by supply chain. We still have pockets of supply chain challenges. We saw a little bit of an uptick in the number of supply chain issues early in the third quarter.

內森，謝謝你的提問。因此，我們確實看到第二季度供應鏈出現了有意義的改善。我們試圖傳達這樣的信息：需求是存在的，而我們受到供應鏈的限制。我們仍然面臨一些供應鏈挑戰。第三季度初，我們發現供應鏈問題的數量略有增加。

But we've assumed in the second half of this year, in our guidance, we've assumed no further changes in supply chain. We're not going to try to predict supply chain changes. When it happens, if it improves, we think we have the opportunity to ship more, but we're assuming no further changes in supply chain, similar to how we guided to after the first quarter. But we are, in aggregate, seeing that improving trend and that's enabled us to deliver more in the second quarter. And as someone noted earlier, increased the second half forecast as well.

但我們在今年下半年的指導中假設供應鏈不會發生進一步的變化。我們不會嘗試預測供應鏈的變化。當這種情況發生時，如果情況有所改善，我們認為我們有機會運送更多貨物，但我們假設供應鏈不會發生進一步的變化，類似於我們在第一季度之後的指導。但總的來說，我們看到了這種改善的趨勢，這使我們能夠在第二季度交付更多產品。正如有人之前指出的那樣，也提高了下半年的預測。

In terms of getting back to pre-COVID margins, the way we're looking at it is we see ourselves growing 200 basis points or more above the markets we're serving. So as we look to '24 and beyond, we continue to have confidence in our development pipeline emerging customers to be able to do that. And we have confidence that we can continue to expand margins.

就回到新冠疫情之前的利潤率而言，我們的看法是，我們的利潤率比我們所服務的市場高出 200 個基點或更多。因此，當我們展望 24 世紀及以後時，我們仍然對我們的新興客戶開發渠道有能力做到這一點充滿信心。我們有信心能夠繼續擴大利潤率。

This year, we're expanding margins at about 1.6 -- I'm sorry, expanding -- growing operating profit, about 1.6x the growth of sales. Our target is to grow operating profit twice as fast as the sales growth rate. We're confident when the labor environment and supply chain more fully stabilized, we can get back to growing profit at twice the rate of sales.

今年，我們的利潤率擴大了約 1.6 倍——對不起，營業利潤增長了，大約是銷售額增長的 1.6 倍。我們的目標是營業利潤增長速度是銷售額增長速度的兩倍。我們有信心，當勞動力環境和供應鏈更加完全穩定時，我們能夠恢復以兩倍於銷售額的速度增長的利潤。

And because we can't fully predict when supply chain is going to get back to that level, I can't predict when that is. But know that we're continuing to be aggressive in the actions we're taking to improve supply chain. We've talked about some of the things we're doing in supply chain, whether it's dual sourcing, whether it's shifting materials, if it's a material constraint, in-sourcing is something that we've also done. And sometimes we in-source in addition to having an external source. So dual source could be external and internal. There's a number of different ways in which we've been working to manage and mitigate supply chain risk.

因為我們無法完全預測供應鏈何時會回到那個水平，所以我無法預測那是什麼時候。但請注意，我們將繼續積極採取行動來改善供應鏈。我們已經討論了我們在供應鏈中所做的一些事情，是否是雙重採購，是否是轉移材料，如果是材料限制，內包是我們也做過的事情。有時，除了外部來源之外，我們還會進行內部來源。所以雙源可以是外部的和內部的。我們一直在努力採用多種不同的方式來管理和降低供應鏈風險。

So we're confident we can achieve our financial objectives. We've got the top line growth, the product development pipeline of new products and emerging customers. We're expanding margins this year and what we think is still a challenging environment. And we're confident we can get to our strategic objective of profit growth twice as fast as sales when we get to a more fully stabilized supply chain and labor environment.

因此，我們有信心能夠實現我們的財務目標。我們擁有收入增長、新產品和新興客戶的產品開發渠道。今年我們正在擴大利潤，但我們認為環境仍然充滿挑戰。我們相信，當供應鍊和勞動力環境更加穩定時，我們就能實現利潤增長速度是銷售額增長兩倍的戰略目標。

All right. Perfect. And at this time, I'm not seeing any more questions. So I'd like to turn it back over to Andrew Senn and the team at Integer.

好的。完美的。此時，我沒有看到更多問題。所以我想把它轉回給 Andrew Senn 和 Integer 團隊。

Great. Thank you for joining the call today. As always, you can access the replay of this call on our website as well as the presentation that was just covered. Thank you for your interest Integer, and that concludes today's call.

偉大的。感謝您今天加入通話。與往常一樣，您可以在我們的網站上觀看本次電話會議的重播以及剛剛介紹的演示文稿。感謝您對 Integer 的關注，今天的電話會議到此結束。

Thank you, and you may now all disconnect.

謝謝，你們現在可以斷開連接了。