Owens & Minor Inc (OMI) 2024 Q2 法說會逐字稿

Good day, and thank you for standing by. Welcome to the Owens & Minor second-quarter 2024 earnings conference call. Please be advised that today's conference call is being recorded.

美好的一天，感謝您的支持。歡迎參加 Owens & Minor 2024 年第二季財報電話會議。請注意，今天的電話會議正在錄音。

I would now like to hand the conference over to your first speaker today, Jackie Marcus, Investor Relations. Jackie, you may begin.

現在，我想將會議交給今天的第一位發言人，投資者關係部門的傑基·馬庫斯 (Jackie Marcus)。傑基，你可以開始了。

Thank you, operator. Hello, everyone, and welcome to the Owens & Minor second-quarter 2024 earnings call. Our comments on the call will be focused on the financial results for the second quarter of 2024 as well as our outlook for 2024, both of which are included in today's press release.

謝謝你，接線生。大家好，歡迎參加 Owens & Minor 2024 年第二季財報電話會議。我們對此電話會議的評論將集中於 2024 年第二季的財務業績以及我們對 2024 年的展望，這兩項內容均包含在今天的新聞稿中。

The press release along with the supplemental slides are posted on the Investor Relations section of our website. Please note that during this call, we will make forward-looking statements. The matters addressed in these statements are subject to risks and uncertainties, which could cause actual results to differ materially from those projected or implied here today. Please refer to our SEC filings for a full description of these risks and uncertainties, including the Risk Factors section of our annual report on Form 10-K and quarterly reports on Form 10-Q.

新聞稿以及補充幻燈片發佈在我們網站的投資者關係部分。請注意，在這次電話會議中，我們將做出前瞻性陳述。這些聲明中涉及的事項存在風險和不確定性，這可能導致實際結果與今天預測或暗示的結果有重大差異。請參閱我們向 SEC 提交的文件，以了解這些風險和不確定性的完整描述，包括我們 10-K 表年度報告和 10-Q 表季度報告的風險因素部分。

In our discussion today, we will reference certain non-GAAP financial measures, and information about these measures and reconciliations to the most comparable GAAP financial measures are included in our press release.

在今天的討論中，我們將參考某些非公認會計準則財務指標，有關這些指標以及與最具可比性的公認會計準則財務指標的調節的信息均包含在我們的新聞稿中。

Today, I'm joined by Ed Pesicka, Owens & Minor's President and Chief Executive Officer; and Jon Leon, the Interim Chief Financial Officer and Senior Vice President of Finance and Corporate Treasurer.

今天，Owens & Minor 總裁兼執行長 Ed Pesicka 也加入了我的行列。臨時財務長兼財務資深副總裁兼企業財務主管 Jon Leon。

I will now turn the call over to Ed.

我現在將把電話轉給艾德。

Thank you, Jackie. Good morning, everyone, and thank you for joining us on the call today. It's been an exciting past few weeks here at Owens & Minor. Last Tuesday, we shared with all of you our definitive agreement to acquire Rotech Healthcare Holdings, Inc. The addition of Rotech aligns with our strategy to strengthen and expand our existing patient direct business as one of the premier suppliers to support home-based care. Combining our organizations allows us to improve our capabilities, broaden our reach and ultimately improve our service levels to patients, providers, and payers. And furthermore, it accelerates our pace to achieve our long-term patient direct revenue target of $5 billion by 2028, demonstrating our commitment to sustainable growth and driving long-term shareholder value.

謝謝你，傑基。大家早安，感謝您今天加入我們的電話會議。過去幾週在 Owens & Minor 度過了令人興奮的時光。上週二，我們與大家分享了收購 Rotech Healthcare Holdings, Inc. 的最終協議。合併我們的組織使我們能夠提高我們的能力，擴大我們的影響範圍，並最終提高我們對患者、提供者和付款人的服務水準。此外，它加快了我們在 2028 年實現 50 億美元長期患者直接收入目標的步伐，體現了我們對永續成長和推動長期股東價值的承諾。

Turning to our second-quarter performance. It was business as usual for Owens & Minor, as we hit our internal expectations with another strong quarter and made progress against our long-term strategic goals we outlined during our Investor Day in December 2023. The underlying strength of our business is evident, with top-line growth in both of our business segments and improved profitability. We are excited about the second half of 2024 as we expect to outperform the first half of this year, a continuation of historical trends with strong back half performances.

轉向我們第二季的業績。Owens & Minor 一切如常，因為我們又一個強勁的季度達到了內部預期，並在 2023 年 12 月投資者日期間概述的長期戰略目標方面取得了進展。我們業務的潛在實力是顯而易見的，兩個業務部門的收入均實現成長，獲利能力也有所提高。我們對 2024 年下半年感到興奮，因為我們預計將超越今年上半年，這是歷史趨勢的延續，下半年表現強勁。

While Jon Leon, our Interim Chief Financial Officer, will do a more thorough review of our financials, I would like to briefly highlight a few of our operational and financial achievements from the second quarter. Our products and healthcare services segment generated $2 billion in revenue, reflecting a 4% improvement over this time last year. Our medical distribution division's strong second quarter was the result of exceptional same-store sales growth, enhancements on our supplier funding programs, and the onboarding of new business wins. Our global products division also experienced some growth at the top line and further improvements in profitability.

雖然我們的臨時財務長 Jon Leon 將對我們的財務狀況進行更徹底的審查，但我想簡要強調我們第二季度的一些營運和財務成就。我們的產品和醫療保健服務部門創造了 20 億美元的收入，比去年同期成長了 4%。我們的醫療分銷部門第二季度的強勁表現是同店銷售的出色增長、供應商融資計劃的加強以及新業務的引入的結果。我們的全球產品部門的營收也出現了一些成長，獲利能力也進一步提高。

At our Investor Day, we outlined our plan to optimize the P&HS segment through: one, leveraging the scale of the channel profitability; two, growing our Owens & Minor branded product portfolio; and three, expanding into adjacent channels and markets. In our first two quarters of 2024, we are already making progress in these areas with a particular focus on driving greater efficiencies that in the second quarter reduced our manufacturing, transportation, and distribution costs. These efforts, combined with inflation-mitigating tactics, gave us the financial flexibility to reinvest in our business while also doing exactly what we said we would do: increasing the overall profitability of this segment.

在投資者日，我們概述了透過以下方式優化 P&HS 細分市場的計劃：一是利用通路獲利規模；第二，擴大我們的 Owens & Minor 品牌產品組合；三是拓展鄰近通路和市場。在 2024 年的前兩個季度，我們已經在這些領域取得了進展，特別注重提高效率，從而在第二季度降低了製造、運輸和分銷成本。這些努力與通膨緩解策略相結合，為我們提供了財務靈活性，可以對我們的業務進行再投資，同時也完全按照我們所說的去做：提高該部門的整體盈利能力。

Our patient direct segment posted $660 million in revenue in the second quarter, a 4% year-over-year improvement, driven by strong growth in diabetes and sleep supplies. Our growth is even more impressive given the particularly strong second quarter we had this time last year. During the quarter, we continue to focus on our key initiatives, along with our alignment on the commercial organization within the Apria division to improve growth in respiratory, oxygen, and the sleep journey. By the end of the quarter, we began to see that alignment deliver improved growth. As a reminder, we typically see stronger performance from this segment in the second half of the year, and we expect a similar outcome in 2024.

在糖尿病和睡眠用品強勁成長的推動下，我們的患者直接部門第二季營收為 6.6 億美元，較去年同期成長 4%。考慮到去年這個時候我們第二季的表現尤其強勁，我們的成長更加令人印象深刻。在本季度，我們繼續專注於我們的關鍵舉措，以及我們與 Apria 部門內的商業組織的協調，以改善呼吸、氧氣和睡眠旅程的成長。到本季末，我們開始看到這種調整帶來了更好的成長。提醒一下，我們通常會在下半年看到該細分市場的強勁表現，並預期 2024 年會出現類似的結果。

From a longer-term macro perspective, our patient direct segment has considerable tailwinds supporting our organic growth efforts. From a demographic perspective, there are an estimated 133 million Americans who suffer from at least one chronic condition, with 40% of American adults suffering from multiple chronic conditions, and many more still not yet diagnosed, particularly in diabetes and sleep apnea. These demographic trends make us excited about our patient direct segment despite the groundswell of support for weight loss medications.

從更長期的宏觀角度來看，我們的患者直接細分市場有相當大的推動力支持我們的有機成長努力。從人口統計角度來看，估計有 1.33 億美國人患有至少一種慢性病，其中 40% 的美國成年人患有多種慢性病，還有更多尚未確診，特別是糖尿病和睡眠呼吸中止症。儘管人們對減重藥物的支持不斷增加，但這些人口統計趨勢讓我們對我們的患者直接細分市場感到興奮。

Moreover, we are not currently seeing an impact from the use of GLP-1s on our served patient population. The diabetic patients we serve are primarily type 1 or insulin dependent, which requires continuous glucose monitoring regardless of GLP-1 use.

此外，我們目前沒有看到 GLP-1 的使用對我們服務的患者群體產生影響。我們服務的糖尿病患者主要是第 1 型糖尿病或胰島素依賴型糖尿病患者，無論是否使用 GLP-1，都需要持續監測血糖。

With respect to sleep apnea patients, while GLP-1s may help some patients, there are still 80% of the population with sleep apnea that are not yet diagnosed. As I noted earlier, we announced our intent to acquire Rotech, which will be an expansion of our patient direct segment. Rotech brings a wealth of expertise in respiratory and home medical equipment aligning perfectly to deliver exceptional care, innovative solutions, and top-notch service levels for patients, providers, and payers.

對於睡眠呼吸中止症患者，雖然GLP-1可能對部分患者有幫助，但仍有80%的睡眠呼吸中止症族群尚未診斷。正如我之前指出的，我們宣布了收購 Rotech 的意向，這將擴大我們的患者直接業務部門。Rotech 在呼吸和家庭醫療設備方面擁有豐富的專業知識，完美結合，為患者、提供者和付款人提供卓越的護理、創新的解決方案和一流的服務水平。

Being just a few months into our long-term strategic plan, we are progressing as expected in both segments. Our team has done a tremendous job in just the first two quarters since launching our Vision 2028 plan at Investor Day. From driving efficiencies, improving customer service to building strong organic growth channels, and the plan to add Rotech to our patient direct segment, all of which proves we are on the right path, and only just getting started. We remain dedicated to achieving the objectives set forth during our Investor Day in December 2023, and our performance thus far reflects that commitment.

我們的長期策略計畫剛實施幾個月，我們在這兩個領域都取得了預期的進展。自從在投資者日推出 2028 年願景計畫以來，我們的團隊在前兩季就取得了巨大的成績。從提高效率、改善客戶服務到建立強大的有機成長管道，以及將 Rotech 添加到我們的患者直接細分市場的計劃，所有這些都證明我們走在正確的道路上，而且才剛剛開始。我們仍然致力於實現 2023 年 12 月投資者日期間設定的目標，迄今為止我們的表現反映了這一承諾。

I would now like to turn the call over to our Interim Chief Financial Officer, Jon Leon, to discuss our second-quarter financial performance in more detail. Jon?

我現在想將電話轉給我們的臨時財務長 Jon Leon，更詳細地討論我們第二季的財務表現。喬恩？

Thanks, Ed, and good morning, everyone. I will be providing an overview of our financial results and some key factors that drove our performance in the second quarter as well as our outlook for the remainder of the year. Our revenue for the quarter was $2.7 billion, up 4% compared to the prior year with solid growth in both segments. Products and healthcare services grew 4% overall as compared to the prior year, with 5% year-over-year growth in our medical distribution division as same-store sales and net new customer wins drove the top-line change.

謝謝艾德，大家早安。我將概述我們的財務業績和推動我們第二季業績的一些關鍵因素以及我們對今年剩餘時間的展望。我們本季的營收為 27 億美元，比上年成長 4%，兩個細分市場均穩健成長。產品和醫療保健服務整體較上年增長 4%，其中我們的醫療分銷部門同比增長 5%，因為同店銷售和淨新客戶贏得推動了營收變化。

Patient direct revenue of $660 million was up 4% compared to the second quarter of last year. Major therapy categories like diabetes, sleep supplies, and wound again has strong performance, although certain respiratory therapies such as NIV and oxygen were below expectations. Within patient direct, patient eligibility and verification continue to regain momentum. However, a meaningful decrease in backlog of customers extended into the second quarter. We should be clear of these onboarding timing issues as we move through the second half of the year.

患者直接收入為 6.6 億美元，比去年第二季成長 4%。儘管某些呼吸療法如非創通氣和氧氣的表現低於預期，但糖尿病、睡眠用品和傷口等主要治療類別再次表現強勁。在患者直接內部，患者資格和驗證繼續恢復勢頭。然而，積壓客戶的顯著減少延續到了第二季。當我們進入下半年時，我們應該清楚這些入職時間問題。

Gross profit in the second quarter was $544 million or 20.4% of net revenue, reflecting margin expansion of 11 basis points as compared to the second quarter of last year. This improvement is largely the benefit of investments in efficiency and productivity over the last several months. Our distribution, selling, and administrative expenses for the quarter were $469 million, up from $455 million in the second quarter of '23. The increase was primarily due to sales growth as DS&A was just below 18% of revenue for both this year and last year.

第二季毛利為 5.44 億美元，佔淨收入的 20.4%，反映出利潤率比去年第二季擴大了 11 個基點。這項改進很大程度上得益於過去幾個月在效率和生產力方面的投資。本季我們的分銷、銷售和管理費用為 4.69 億美元，高於 2023 年第二季的 4.55 億美元。這一增長主要是由於銷售額增長，因為今年和去年 DS&A 均略低於收入的 18%。

GAAP operating income for the quarter was $20.3 million, up 87% year over year and adjusted operating income was $76.3 million. Adjusted operating income was up 23% year over year. Interest expense for the second quarter was $36 million, down 12% compared to $41 million in the second quarter of 2023. This is largely due to the nearly one full turn of reduction in leverage in the last 12 months, partially offset by the impact of higher interest rates versus last year.

該季度 GAAP 營業收入為 2,030 萬美元，年增 87%，調整後營業收入為 7,630 萬美元。調整後營業收入較去年同期成長 23%。第二季利息支出為 3,600 萬美元，比 2023 年第二季的 4,100 萬美元下降 12%。這主要是由於過去 12 個月槓桿率下降了近一圈，部分被去年利率上升的影響所抵消。

In the second quarter, we recorded a onetime tax charge of $17 million or $0.22 per share related to a recent decision associated with notices of proposed adjustments that we received back in 2020 and 2021. This was just communicated to us in late June of 2024. Due to the nature of this charge, this item is included in our GAAP to non-GAAP reconciliations.

在第二季度，我們記錄了 1700 萬美元或每股 0.22 美元的一次性稅費，這與我們在 2020 年和 2021 年收到的擬議調整通知相關的最近決定有關。這是 2024 年 6 月下旬剛通知我們的。由於這項費用的性質，該項目包含在我們的 GAAP 與非 GAAP 調整表中。

The matter at hand, as we've discussed in previously filed SEC documents, is related to past transfer pricing methodology, which is no longer employed. There is an expected related cash payment to be made in the second half of the year in a range of $30 million to $35 million. We believe the matter will be concluded without further impact to our financial results.

正如我們在先前提交的 SEC 文件中所討論的，目前的問題與過去的轉讓定價方法有關，該方法已不再採用。預計下半年將支付3,000萬至3,500萬美元的相關現金。我們相信此事將得到解決，不會對我們的財務表現產生進一步影響。

Our GAAP effective tax rate reflects this charge and was negative 89.9% for the quarter. The adjusted effective tax rate was 28.9%. Our GAAP net loss for the quarter was $31.9 million or a loss of $0.42 per share compared to the second quarter of last year when the net loss was $28.2 million or $0.37 per share. Adjusted net income for the quarter doubled to $28.2 million or $0.36 per share from $14.2 million or $0.18 per share during the second quarter of '23. Adjusted EBITDA was $127 million, up 12% versus the $113 million reported in the second quarter of last year.

我們的 GAAP 有效稅率反映了這一費用，本季為負 89.9%。調整後的有效稅率為28.9%。我們本季的 GAAP 淨虧損為 3,190 萬美元，即每股虧損 0.42 美元，而去年第二季的淨虧損為 2,820 萬美元，即每股虧損 0.37 美元。該季度調整後淨利潤從 2023 年第二季的 1,420 萬美元或每股 0.18 美元翻倍至 2,820 萬美元或每股 0.36 美元。調整後 EBITDA 為 1.27 億美元，比去年第二季的 1.13 億美元成長 12%。

Also, we've generated $116 million of operating cash flow this quarter, a strong improvement versus Q1 of '24. This allows us to reduce net debt by $70 million. We anticipate a good cash flow generation here that will include typical lumpiness quarter to quarter, and we remain intensely focused on cash flow generation. With respect to our current outstanding debt, we have $171 million of a series of notes, which is due in December of this year. Earlier this week, we gave notice to redeem those notes at par in September and will do so with cash on hand.

此外，本季我們產生了 1.16 億美元的營運現金流，與 24 年第一季相比有了顯著改善。這使我們能夠減少 7000 萬美元的淨債務。我們預計這裡會產生良好的現金流，其中包括典型的季度波動，並且我們仍然高度關注現金流的產生。就我們目前的未償債務而言，我們有 1.71 億美元的一系列票據，將於今年 12 月到期。本週早些時候，我們發出通知，將在 9 月按面值贖回這些票據，並將使用手頭現金進行贖回。

We remain committed to delivering our 2024 guidance. We expect revenue to be in the range of $10.5 billion to $10.9 billion, adjusted EBITDA to be in the range of $550 million to $590 million, and adjusted EPS with a midpoint of $1.55 per share in an overall range of $1.40 to $1.70. Now, as in prior years, we expect to see modest sequential growth between the second and the third quarters and greater sequential growth from the third to the fourth quarter. And again, I want to remind you that this guidance excludes any impact of the Rotech acquisition.

我們仍然致力於提供 2024 年指導。我們預計營收將在 105 億至 109 億美元之間，調整後 EBITDA 將在 5.5 億至 5.9 億美元之間，調整後每股收益中點為 1.55 美元，總體範圍為 1.40 至 1.70 美元。現在，與往年一樣，我們預計第二季和第三季將出現溫和的環比成長，而第三季至第四季將出現更大的環比成長。我想再次提醒您，本指南排除了 Rotech 收購的任何影響。

With that, I'll turn the call over to the operator for the Q&A session. Operator?

這樣，我會將電話轉給接線生進行問答環節。操作員？

(Operator Instructions) Michael Cherny, Leerink Partners.

（操作員說明）Michael Cherny，Leerink Partners。

I want to talk about some of the operational plans that you've had put in place, in particular the progress you made on the products and healthcare services side. As you think about the moving pieces on margins, you were kind of flat sequentially. Where are the biggest opportunities to expand in the back half of the year? Is it volume? Is it that unlocking of the backlog of customers? And how does the dynamics around the tariffs that are expected to go into place impact or not impact you relative to the sourcing side?

我想談談你們已經制定的一些營運計劃，特別是你們在產品和醫療服務方面取得的進展。當你考慮邊緣的移動部分時，你會發現順序是持平的。下半年最大的擴張機會在哪裡？是體積嗎？是積壓客戶的解鎖嗎？相對於採購方，預計將實施的關稅動態對您有何影響？

Let me take those somewhat in reverse orders. On the tariff aspect, it's going to have a minimal impact on us and a significant portion of our products are manufactured in our own facilities, whether that's in the US or whether that's in Mexico, Honduras, so in the Americas. Our glove footprint is not in China. We have, as we've talked in the past, about more than half of our gloves we're making in our own factories, and those factories are in Southeast Asia, not in China. So it's going to have a minimal impact, really, on our proprietary or private label products.

讓我以相反的順序來理解這些內容。在關稅方面，這對我們的影響很小，我們的產品很大一部分是在我們自己的工廠生產的，無論是在美國還是在墨西哥、宏都拉斯等美洲。我們的手套足跡不在中國。正如我們過去所說，我們大約一半以上的手套是在我們自己的工廠生產的，這些工廠位於東南亞，而不是中國。因此，這實際上對我們的專有或自有品牌產品的影響很小。

If I think about the levers we have in the back half of the year, within our products and healthcare services, it's the continued execution on sourcing. As we've seen prices come down and overall, let's just take, the main category PPE, we've done a really good job continuing to source raw materials at lower rates to make sure that as those prices come down, our costs are coming down correspondingly with them.

如果我考慮今年下半年我們在產品和醫療保健服務方面擁有的槓桿，那就是持續執行採購。正如我們所看到的價格下降，總體而言，我們以主要類別個人防護裝備為例，我們做得非常好，繼續以較低的價格採購原材料，以確保隨著價格下降，我們的成本也隨之下降與他們相應地下降。

The other aspect of it is really in operational effectiveness in our P&HS segment. Continue to look at our footprint, continue to look at the right level of new advanced automation technology in the warehouses to drive operating efficiencies. So we saw some of the improvement in this quarter in DS&A, or distribution, selling and administrative expenses. There's where the opportunities continue to line.

另一方面是我們 P&HS 部門的營運效率。繼續關注我們的足跡，繼續關注倉庫中新的先進自動化技術的適當水平，以提高營運效率。因此，我們看到本季 DS&A（即分銷、銷售和管理費用）有所改善。這就是機會不斷出現的地方。

Longer term, if you go back to our strategy, really the longer-term impact is the expansion of our private label or proprietary product portfolio, that takes time as we build the product portfolio out and then continue to work with our customers to show the value of it, and then even further along the line is adjacencies. So hopefully, that helps talk about really how we're thinking about the impact of the tariffs, how we're thinking about using our continuous improvement and operating model to continue to drive operating efficiencies out, and then some of the longer term and midterm opportunities.

從長遠來看，如果你回到我們的策略，真正的長期影響是我們自有品牌或專有產品組合的擴展，這需要時間，因為我們建立產品組合，然後繼續與客戶合作以展示它的價值，然後更進一步的是鄰接。因此，希望這有助於真正討論我們如何考慮關稅的影響，我們如何考慮利用我們的持續改進和營運模式來繼續提高營運效率，然後是一些長期和中期的問題機會。

If I could just ask a second one on cash flow. I know that was a big focal point earlier in the year when you gave guidance, you talked of some of the customer onboarding. Can you talk about the dynamics behind the reversal this quarter and how that should factor in in terms of your cash generation versus use over the course of the year, especially as you think through normalizing the onboarding of some of those large customer wins you had?

如果我可以問第二個關於現金流的問題。我知道這是今年早些時候您提供指導時的一個重要焦點，您談到了一些客戶入職。您能否談談本季逆轉背後的動態，以及在全年現金產生與使用方面應如何考慮這一因素，特別是當您考慮如何規範您贏得的一些大客戶的入職時？

Yes, Mike, it's Jon. So obviously, as you mentioned, we talked before about the need to add inventory for those onboarding activity, and that could also slow down AR a little bit when you bring on large customers like we did in distribution. What you saw in Q2 was a little more lift in inventory, and that was offset by payables, and payables kind of offset that pretty nicely. Like Q1, we also had the quarter end on a Friday, which is actually beneficial to our payables.

是的，麥克，我是喬恩。顯然，正如您所提到的，我們之前討論過需要為這些入職活動增加庫存，當您像我們在分銷領域那樣吸引大客戶時，這也可能會稍微減慢 AR 的速度。你在第二季度看到的是庫存增加了一點，這被應付帳款抵消了，而應付帳款很好地抵消了這一點。與第一季一樣，我們也在周五進行了季度末，這實際上對我們的應付帳款有利。

And we have been pretty successful in driving out payment terms where appropriate with third parties. So that combination is going to continue to help us out in the back half of the year. Keep in mind, we'll also get the seasonality in the back half of the year, particularly in patient direct, which will have very attractive cash flow as the year goes on, and their contractual allowances should drop as the year goes on as well. So I think we'll see more efficiency. We will see more efficiency in working capital around payables we see within inventory.

我們在與第三方制定適當的付款條件方面非常成功。因此，這種組合將在今年下半年繼續幫助我們度過難關。請記住，我們還將在今年下半年獲得季節性，特別是在患者直接方面，隨著時間的推移，這將具有非常有吸引力的現金流，並且隨著時間的推移，他們的合約津貼也應該下降。所以我認為我們會看到更高的效率。我們將看到庫存中應付帳款的營運資金效率更高。

And then we look at the seasonal lift now keeping in mind that what you're looking at is a point in time as it's the last day of the quarter. So we're actually -- we're more efficient in Q2 than we saw, for example, average inventory was lower than it was at the very end of the quarter. So we were able to get that cash flow and reduce debt. But I think as the year goes on, that working capital efficiency and then the seasonality of the business will drive pretty attractive cash flow compared to the first half of the year.

然後我們現在看看季節性增長，請記住，您所看到的是一個時間點，因為這是該季度的最後一天。所以我們實際上 - 我們在第二季度的效率比我們看到的要高，例如，平均庫存低於本季末的水平。因此，我們能夠獲得現金流並減少債務。但我認為隨著時間的推移，與上半年相比，營運資金效率以及業務的季節性將帶來相當有吸引力的現金流。

So will you have meaningful cash flow conversion over the course of the year? I know that was the point of contention earlier in the year.

那麼，您在這一年中會實現有意義的現金流轉換嗎？我知道這是今年早些時候爭論的焦點。

We will do -- yes, I would be very disappointed if we [did] do quite a bit better in the second half than we've done in the first half.

我們會做的——是的，如果我們下半場做得比上半場好很多，我會非常失望。

Kevin Caliendo, UBS.

凱文‧卡里恩多，瑞銀集團。

First, can we talk a little bit -- there's been a lot of interest around what's going on with shipping costs and how it impacts the channel. The tariffs are one thing, but the shipping costs have -- the ones that we can track anyways -- have risen dramatically. And I guess I'm trying to understand how it impacts you, how it impacts the industry. Does it help you that you're nearshore? And does it make your products that are manufactured domestically more attractive? Just trying to understand the impact across the channel.

首先，我們可以談談──人們對運輸成本的變化及其對通路的影響非常感興趣。關稅是一回事，但運輸成本——我們無論如何都可以追蹤的——已經急劇上升。我想我正在嘗試了解它如何影響你，如何影響整個產業。你在近岸，這對你有幫助嗎？這是否會讓你們在國內生產的產品更具吸引力？只是想了解整個管道的影響。

Yes. So it's primarily an impact on the P&HS segment, not necessarily in the patient direct segment. Yes, for those products that we're manufacturing nearshore, it create some level of an advantage for us. But again, I talked earlier that about half of our gloves we're making at our own factory in Southeast Asia and bringing them over. It's impacted us in a couple of different ways.

是的。因此，這主要是對 P&HS 部門的影響，不一定是對病人直接部門的影響。是的，對於我們在近岸生產的那些產品，它為我們創造了一定程度的優勢。但我之前說過，我們大約有一半的手套是在東南亞自己的工廠生產的，然後運過來的。它以多種不同的方式影響了我們。

As we started to see those rates start to rise, we have made some investment in incremental inventory coming over in advance of some of those larger increases that we're seeing in the marketplace. But ultimately, this is going to have a bigger impact on those that do primarily all of their sourcing or the vast majority of the sourcing from overseas.

當我們開始看到這些利率開始上升時，我們在市場上看到的一些較大的成長之前對增量庫存進行了一些投資。但最終，這將對那些主要進行所有採購或絕大多數採購來自海外的公司產生更大的影響。

Look, it's a headwind that we know we have in the business. It's also part of how do we utilize our operating model to continue to try to offset that, whether it's advanced shipments prior to some of those increases, but also continue to look at different ways to more efficiently bring the product over. But it is going to create some level of a headwind in the business in the back half of the year.

看，我們知道我們在這個行業面臨逆風。這也是我們如何利用我們的營運模式繼續嘗試抵消這一影響的一部分，無論是在其中一些增長之前提前發貨，還是繼續尋找不同的方法來更有效地交付產品。但這將在今年下半年為該行業帶來一定程度的阻力。

So what you're saying is you're trying to get product in sooner, maybe you're going to build up more inventory before it starts to affect as much as you possibly can, and hope that customers will be willing to buy those sooner because they know the prices are likely to go higher. Does that in general...

所以你的意思是你正試圖更快地獲得產品，也許你會在它開始影響盡可能多的影響之前建立更多的庫存，並希望客戶願意盡快購買這些產品因為他們知道價格可能會更高。是不是一般情況下...

And it may not even necessarily then buy the products sooner and just to have a better landed cost on the product than not.

而且，它甚至不一定會更快地購買產品，只是為了獲得更好的產品到岸成本。

Maybe this is one for Jonathan. The patient direct ramp in the second half, it's a little bit more than normal seasonality, it looks like to me. Can you just give us a little bit of comfort or rationale behind why there will be this acceleration? I know there were investments, but if you can maybe go a little deeper on that, that would be great.

也許這就是喬納森的經歷。在我看來，下半年病人的直接上升，比正常的季節性多。您能否給我們一些安慰或解釋為什麼會出現這種加速？我知道有投資，但如果你能更深入地了解這一點，那就太好了。

Yes, Kevin. The biggest factor, as I indicated in my remarks, were that we're still dealing with the backlog in patient direct that, frankly, is a holdover from change that we probably underestimated because the extent of that impact, Q1 to Q2. We have a normal queue of people waiting for our supplies all the time, but this is substantially larger than it would normally be. And those are primarily sleep patients, so it's a little more profit associated with them.

是的，凱文。正如我在發言中指出的，最大的因素是我們仍在處理直接患者積壓的問題，坦白說，這是我們可能低估的變化的遺留問題，因為影響的程度從第一季到第二季。我們一直都有正常的人排隊等待我們的物資，但這比平常多得多。這些人主要是睡眠患者，因此與他們相關的利潤要多一些。

So if you factor that -- we are catching up. There's a lot of manual effort to go into that catch up, but we are catching up and we're clearing that backlog. So you take that combination then with the normal seasonality in the business, we're pretty confident in a much stronger second half.

因此，如果你考慮到這一點——我們正在迎頭趕上。需要花費大量的人力來追趕，但我們正在趕上，並且正在清除積壓的工作。因此，結合業務的正常季節性，我們對下半年的強勁表現非常有信心。

And I'll just add two other things. One is we clearly understood that when we added additional commercial resources, that would create some level of, I'm going to call it, disruption, but some level of impact in the beginning of the year here with the expectation that it takes about 12 months for them to provide a positive impact. So we'll see that as that progresses in the year. And the other thing, if you look at Q2 year over year, last year, our Q2 growth rate was pretty strong. So those are some other factors that give us the comfort in the back half of the year and the growth.

我將添加另外兩件事。一是我們清楚地了解，當我們添加額外的商業資源時，這會造成一定程度的破壞，我稱之為破壞，但在今年年初會產生一定程度的影響，預計需要大約 12 年的時間。個月來為他們提供正面的影響。因此，隨著今年的進展，我們將會看到這一點。另一方面，如果你對比去年第二季度，我們的第二季成長率相當強勁。這些是讓我們在下半年感到安慰和成長的其他一些因素。

John Stansel, JPMorgan.

約翰‧史坦塞爾，摩根大通。

Just following up on the plan around patient direct. Is there just a way to frame given you have some visibility into this backlog about how you think about the impact on patient direct's top-line growth? And then now that we're kind of a month into the third quarter, is this something that you think now is -- this change is kind of coming in the rear view that will be more of a 3Q benefit? Or is this something that kind of could progress into 4Q?

只是跟進直接圍繞患者的計劃。鑑於您對積壓的工作有一定的了解，是否有一種方法可以框架您如何看待患者直接收入成長的影響？現在我們已經進入第三季一個月了，你認為現在是這樣的嗎——這種變化是在後視圖中出現的，將更多地帶來第三季度的好處？或者這是否可以進入第四季？

Yes, John. We can help you think about it. So what happens -- the eligibility verification process has become very manual very quickly. And we're doing a very good job of clearing that, getting better at that, and bringing on new providers to help us with that process.

是的，約翰。我們可以幫助您思考。那麼會發生什麼事——資格驗證過程很快就變得非常手動。我們在解決這個問題方面做得非常好，在這方面做得更好，並引入新的提供者來幫助我們完成這個過程。

The way to think about it, and I would call it back to at any point in time, there's a queue of 10,000 customers waiting for supplies and that we saw that into June grow to as much as 50,000. So that is getting better now, that we're going through the third quarter, we'll continue to get better throughout the year. So that has certainly impacted the growth. And I think the order, a lot of it is predominantly sleep supplies, and that's a very attractive margin business that we're waiting to get aligned.

想想看，我會在任何時候回想起來，有 10,000 名顧客在排隊等待供應，我們發現到 6 月份這個數字已增至 50,000 人。現在情況正在變得更好，我們正在經歷第三季度，我們將在全年繼續變得更好。所以這肯定影響了成長。我認為訂單中很多主要是睡眠用品，這是一項非常有吸引力的利潤業務，我們正在等待調整。

Great. And then just kind of thinking about gross margins that stepped down sequentially from the first quarter. Now I normally think of this as kind of gross margins stepping up throughout the year. That kind of slight step down that you saw, is that more kind of attributable to the patient direct mix shift? Or is there other factors you'd highlight about kind of what drove that? And then I would assume, given your reaffirmed guidance, we should just see a bit of a steeper ramp into the back half for gross margin. Is that kind of the right way to think about it?

偉大的。然後想想從第一季開始連續下降的毛利率。現在我通常認為這是全年毛利率的上升。你看到的那種輕微的下降，是不是更多地歸因於耐心的直接混音轉變？或者您還有其他因素需要強調推動這一趨勢的因素？然後我認為，鑑於您重申的指導，我們應該會看到後半部分的毛利率略有上升。這是正確的思考方式嗎？

That is the right way to think about it. Mix shift in patient direct can be meaningful, and we've talked about before that versus sleep and respiratory areas have higher margin, things like diabetes, which has been growing very nicely for us.

這是正確的思考方式。患者直接的混合轉移可能是有意義的，我們之前已經討論過，與睡眠和呼吸領域相比，糖尿病等疾病的利潤率更高，糖尿病對我們來說增長得非常好。

Stephanie Davis, Barclays.

史蒂芬妮戴維斯，巴克萊銀行。

Now that you've had a little bit of time to just have the market digest the Rotech acquisition announcement, I was hoping you could tell us about some initial feedback from your payer and provider customers and how they're thinking about the deal.

現在您已經有一點時間讓市場消化 Rotech 收購公告，我希望您能告訴我們您的付款人和提供者客戶的一些初步反饋以及他們對這筆交易的看法。

Yes. I'll just talk a little -- maybe I'll start at a high level. I think it's been clear the feedback has been that this is clearly in line with the strategy you talked about about continuing to invest inorganically specifically in the patient direct space, continuing to provide a better solution, it's still early on. So to get the patient and the payer feedback, that's still in process.

是的。我只談一點——也許我會從高層次開始。我認為很明顯，反饋表明這顯然符合您談到的繼續對患者直接領域進行無機投資、繼續提供更好的解決方案的策略，但現在還處於早期階段。因此，為了獲得患者和付款人的回饋，該工作仍在進行中。

But overall, it's been extremely positive. I think overall, from a standpoint, we believe that this is going to ultimately provide a much better experience for the patient, the ability to focus on a single company to support them, as well as to be able to get their products hopefully potentially more efficiently. And then the same with the payers being able to continue to work with us. So it's early on. I think we'll continue to gather that information, but that's where we are on it right now.

但總體而言，這是非常積極的。我認為總的來說，從一個角度來看，我們相信這最終將為患者提供更好的體驗，能夠專注於一家公司來支持他們，並且能夠更好地獲得他們的產品高效。然後付款人能夠繼續與我們合作也是如此。所以現在還早。我認為我們將繼續收集這些信息，但這就是我們現在的情況。

And a follow-up on patient direct, you did call out some [uses] in the quarter on NIV and oxygen. Could you call any trend or if that's more of a one-off with the owned business, just given the exposure at Rotech?

作為對患者直接的後續行動，您確實指出了本季度 NIV 和氧氣的一些[用途]。考慮到 Rotech 的曝光度，您能否稱之為任何趨勢，或者這更像是自有業務的一次性趨勢？

No. I would tell you, just now, a couple of quarters now, Steph, and we've talked about when we're not doing what we should be doing and expect to do in terms of growing NIV and oxygen. I would call that unique to us. I'm [confident] that's unique to us, and we have plans in place and working on that to remember that in the back half of the year.

不。我想告訴你，史蒂芬，現在幾個季度了，我們已經討論過在增加無創通氣和氧氣方面我們沒有做我們應該做和期望做的事情。我認為這對我們來說是獨一無二的。我[有信心]這對我們來說是獨一無二的，我們已經制定了計劃並致力於在今年下半年記住這一點。

Daniel Grosslight, Citi.

丹尼爾‧格羅斯萊特，花旗銀行。

I want to go back to some comments you made around cash flow and that being meaningfully -- you expect that to be meaningfully better in the second half versus the first half. That would put you in kind of solidly positive free cash flow territory for this year versus your commentary last quarter where you had thought you would be effectively flat or no free cash flow this year. So I'm just curious what changed in your thinking. Where are you outperforming your initial expectations? And I just wanted to confirm that that cash flow commentary also contemplates that $30 million-plus payment in the back half of this year.

我想回顧一下您對現金流所做的一些評論，這些評論很有意義——您預計下半年的現金流會比上半年明顯更好。這將使您今年的自由現金流處於穩定的正值區域，而您在上個季度的評論中則認為今年的自由現金流實際上將持平或沒有。所以我只是好奇你的想法發生了什麼變化。您在哪些方面超越了最初的預期？我只是想確認現金流評論也考慮了今年下半年支付的 3000 萬美元以上。

Yes, it does. First of all, Dan, it's Jon. Secondly, I would tell you the increased confidence in cash flow comes around the focus and the visibility into working capital activities currently underway. We've talked last couple of quarters about the inventory ramp and Ed talked about that inventory being a little bit higher now for some shipping purposes getting ahead of that curve.

是的，確實如此。首先，丹，我是喬恩。其次，我想告訴您，對現金流的信心增強來自於目前正在進行的營運資本活動的焦點和可見性。我們在過去幾個季度討論了庫存增加的問題，Ed 談到，出於某些運輸目的，庫存現在略高一些，以超越該曲線。

But even throughout most of the second quarter, we saw inventory be pretty well moderated compared to Q1, ramped a little bit late in the quarter. But I think as we think about that, as we get a little smarter about our AP and AR and getting better terms from folks, I think we're pretty confident that cash will get better as the year goes on. We're seeing better collections on a regular basis at our patient direct.

但即使在第二季的大部分時間裡，我們也看到庫存與第一季相比相當溫和，在本季末略有增加。但我認為，當我們考慮這一點時，隨著我們對 AP 和 AR 更加明智，並從人們那裡獲得更好的條件，我認為我們非常有信心隨著時間的推移現金會變得更好。我們定期在患者直通中心看到更好的收藏。

And there were some legal expenses this quarter, I think, related to the Apria. Just curious what's driving that, and if you expect to see increased legal expenses for the remainder of the year after this quarter.

我認為本季有一些與 Apria 有關的法律費用。只是好奇是什麼推動了這一趨勢，以及您是否預計在本季度之後的剩餘時間裡法律費用會增加。

No, nothing going forward. That was a onetime settlement and action that began before we bought Apria. So that has now been settled and behind us. So nothing else to look forward with that.

不，沒有任何進展。這是在我們收購阿普里亞之前就開始的一次性和解和行動。所以現在這個問題已經解決並被我們拋在腦後了。所以沒有什麼值得期待的。

Eric Coldwell, Baird.

埃里克·科德威爾，貝爾德。

I apologize if I missed a couple of these -- for some reason, I've had a hard time with the connection here. Just a little bit hard to understand somethings. In 2Q, did you break out the difference between medical distribution growth and products growth that combined to get you to the 4%. Did you give the growth rates --

如果我錯過了其中的一些內容，我深表歉意——出於某種原因，我很難理解這裡的聯繫。只是有些事情有點難懂。在第二季度，您是否列出了醫療分銷成長和產品成長之間的差異，兩者加在一起使您達到了 4%。你有給出成長率嗎--

No, we didn't. We did not.

不，我們沒有。我們沒有。

Can you?

你可以嗎？

Well, I think we said net distribution grew 5% and the overall segment grew 4%. So I think --

嗯，我想我們說過淨分銷成長了 5%，整個細分市場成長了 4%。所以我認為--

Yes, I didn't hear that. It's been a bad connection today. Okay. And then on the cash flow, I know you've given a number of reasons why it improved, but I still am not sure why the original guidance was flat and now it's so much different. Was it that you're just fundamentally managing the business differently? Or things you expected through Q1 up to the last call, they're turning out differently than you originally expected? It just seems like a very different conversation 90 days later than it was 90 days ago.

是的，我沒聽到。今天連接不好。好的。然後在現金流方面，我知道你已經給出了很多改善的原因，但我仍然不確定為什麼最初的指導是持平的，而現在卻有如此大的不同。是您只是從根本上以不同的方式管理業務？或者您從第一季到最後一次通話的預期結果與您最初的預期不同？90 天後的對話與 90 天前的對話似乎截然不同。

I think that's fair, Eric. And I think it comes down to, one, is focus. As we continue to look forward, I think you've got better visibility now into forecasting of where we think where the opportunities in the lever are. And then it's execution on some of the initiatives we have to drive working capital improvement. So those three major factors are where it is: it's the focus, it's improved forecasting, and our ability to execute on some of those opportunities.

我認為這是公平的，艾瑞克。我認為歸根究底，第一是焦點。當我們繼續展望未來時，我認為您現在可以更好地預測我們認為槓桿中的機會在哪裡。然後是執行我們必須推動營運資本改善的一些措施。因此，這三個主要因素就在那裡：它是焦點，它是改進的預測，以及我們執行其中一些機會的能力。

Great. And I'll just kind of go back to the medical distribution growth of the 5%. Would you be capable of breaking out how much of that growth was market versus new wins? Same-store versus new wins?

偉大的。我將回顧一下 5% 的醫療分配成長情況。您能否詳細說明成長中有多少來自於市場，有多少來自於新的勝利？同店與新店的勝利？

Yes. If I think about the two of them, they're relatively consistent -- I mean, so what's hard to do is -- our same-store sales, if we look at our same-store sales, they're consistent with that 4% and then our wins are consistent to help move that up further. And then there's still some remnants of some other losses we've had in the past that are rolling out. So that's the way I would think about it is from that standpoint.

是的。如果我考慮它們兩個，它們是相對一致的 - 我的意思是，所以很難做到的是 - 我們的同店銷售額，如果我們看看我們的同店銷售額，它們與那 4 一致%，然後我們的勝利是一致的，有助於進一步提高。此外，我們過去遭受的其他一些損失仍在繼續。所以這就是我從這個角度思考的方式。

That concludes our question-and-answer session. I will now turn the conference over to Ed Pesicka for closing comments.

我們的問答環節到此結束。我現在將把會議交給 Ed Pesicka 徵求總結意見。

So thanks, everyone, and excited and thankful that everyone joined the call today. If we think about the future at Owens & Minor, we're extremely excited of what's yet to come in here. We continue to execute on our long-term strategy. We continue to focus on our operating model. We continue to get excited about the potential and future integration and approval with the Rotech rolling that into our patient direct business, which will provide, we believe, significant better service for our patients, providers as well as the payers, and really pleased with the progress we've made to this point in time in our products and healthcare services business. So with that, I appreciate the time today and look forward to talking again next quarter. Thank you.

謝謝大家，很高興也很感謝大家今天加入了電話會議。如果我們思考 Owens & Minor 的未來，我們會對這裡尚未發生的事情感到非常興奮。我們繼續執行我們的長期策略。我們繼續關注我們的營運模式。我們繼續對 Rotech 的潛力和未來整合和批准感到興奮，將其納入我們的患者直接業務，我們相信，這將為我們的患者、提供者以及付款人提供更好的服務，並對到目前為止，我們在產品和醫療保健服務業務方面取得了進展。因此，我很感激今天的時間，並期待下個季度再次交談。謝謝。

This concludes today's conference call. Thank you for your participation, and you may now disconnect.

今天的電話會議到此結束。感謝您的參與，您現在可以斷開連接。