Patterson Companies Inc (PDCO) 2023 Q2 法說會逐字稿

Good morning. My name is Rob, and I will be your conference operator today. At this time, I would like to welcome everyone to the Patterson Companies Second Quarter Fiscal Year 2023 Earnings Conference Call. (Operator Instructions) John Wright, Investor Relations, Vice President, you may begin your conference.

早上好。我叫 Rob，今天我將擔任你們的會議接線員。此時，我想歡迎大家參加 Patterson Companies 2023 財年第二季度收益電話會議。 （操作員說明）投資者關係副總裁 John Wright，您可以開始您的會議了。

Thank you, operator. Good morning, everyone, and thank you for participating in Patterson Companies Fiscal 2023 Second Quarter Conference Call. Joining me today are President and Chief Executive Officer, Don Zurbay and Interim Chief Financial Officer, Kevin Barry. After a review of the fiscal 2023 second quarter results and outlook by management, we will open the call to your questions.

謝謝你，運營商。大家早上好，感謝您參加帕特森公司 2023 財年第二季度電話會議。今天加入我的是總裁兼首席執行官 Don Zurbay 和臨時首席財務官 Kevin Barry。在管理層對 2023 財年第二季度的業績和展望進行審查後，我們將開始徵求您的問題。

Before we begin, let me remind you that certain comments made during this conference call are forward-looking in nature and subject to certain risks and uncertainties. These factors, which could cause actual results to materially differ from those indicated in such forward-looking statements, are discussed in detail in our Form 10-K and our other filings with the Securities and Exchange Commission.

在我們開始之前，讓我提醒您，在本次電話會議中發表的某些評論本質上是前瞻性的，並受到某些風險和不確定性的影響。這些因素可能導致實際結果與此類前瞻性陳述中所示的結果存在重大差異，在我們的 10-K 表格和我們向美國證券交易委員會提交的其他文件中進行了詳細討論。

We encourage you to review this material. In addition, comments about the markets we serve, including growth rates and market shares, are based upon the company's internal analysis and estimates. The content of this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, December 1, 2022. Patterson undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. Also, a financial slide presentation can be found in the Investor Relations section of our website at pattersoncompanies.com.

我們鼓勵您查看此材料。此外，有關我們所服務市場的評論，包括增長率和市場份額，均基於公司的內部分析和估計。本次電話會議的內容包含時效性信息，這些信息僅在現場直播之日（2022 年 12 月 1 日）之前是準確的。Patterson 不承擔修改或更新任何前瞻性陳述以反映該日期之後的事件或情況的義務這個電話。此外，可以在我們網站 pattersoncompanies.com 的投資者關係部分找到財務幻燈片演示。

Please note that in this morning's conference call, we will reference our adjusted results for the second quarter of fiscal '23. The reconciliation table in our press release is provided to adjust reported GAAP measures, namely operating income, other income and expense, net income before taxes, income tax expense, net income, net income attributable to Patterson Companies, Inc. and diluted earnings per share attributable to Patterson Companies, Inc. For the impact of deal amortization, integration and business restructuring expenses, legal reserves, inventory donation charges and gains on investments, along with the related tax effects of these items.

請注意，在今天上午的電話會議上，我們將參考 23 財年第二季度的調整後結果。我們新聞稿中的對賬表用於調整報告的 GAAP 指標，即營業收入、其他收入和費用、稅前淨收入、所得稅費用、淨收入、Patterson Companies, Inc. 應占淨收入和稀釋後每股收益歸因於 Patterson Companies, Inc. 交易攤銷、整合和業務重組費用、法定準備金、庫存捐贈費用和投資收益的影響，以及這些項目的相關稅收影響。

We will also discuss free cash flow as defined in our earnings release, which is a non-GAAP measure and use the term internal sales to represent net sales adjusted to exclude the impact of foreign currency and the extra week of selling results in the first quarter of fiscal '22. These non-GAAP measures are not intended to be a substitute for our GAAP results. This call is being recorded and will be available for replay starting today at 11:00 a.m. Central Time for a period of 1 week.

我們還將討論我們的收益發布中定義的自由現金流，這是一種非公認會計原則衡量標準，並使用術語內部銷售額來表示調整後的淨銷售額，以排除外彙和第一季度額外一周的銷售結果的影響財政'22。這些非 GAAP 措施無意替代我們的 GAAP 結果。此通話正在錄音中，從中部時間今天上午 11:00 開始可以重播，為期 1 週。

Now I'd like to hand the call over to Don Zurbay.

現在我想把電話轉給 Don Zurbay。

Thanks, John, and good morning, everyone. I'm excited to be speaking with you for the first time as Patterson's CEO. I'm honored to be leading the outstanding Patterson team whose commitment to our strategy, customer vision and values has enabled a track record of strong financial performance. I'm pleased with our performance during our fiscal '23 second quarter. As we navigated ongoing macroeconomic challenges during the quarter, we remain focused on driving sales execution and profitability.

謝謝，約翰，大家早上好。作為 Patterson 的首席執行官，我很高興第一次與您交談。我很榮幸能夠領導傑出的 Patterson 團隊，他們對我們的戰略、客戶願景和價值觀的承諾促成了強勁的財務業績記錄。我對我們在 23 財年第二季度的表現感到滿意。當我們在本季度應對持續的宏觀經濟挑戰時，我們仍然專注於推動銷售執行和盈利能力。

Overall, for the quarter, we achieved $1.6 billion in consolidated revenue, representing year-over-year internal sales growth of nearly 1%. Year-over-year operating margin expansion in both our Dental and Animal Health segments and adjusted earnings per diluted share of $0.63, an increase of 9% year-over-year. Given our results through the first half and our forecast for the remainder of the year, we are reaffirming our full year EPS guidance range and remain committed to delivering internal sales growth and operating margin expansion for fiscal '23.

總體而言，本季度我們實現了 16 億美元的綜合收入，內部銷售額同比增長近 1%。我們的牙科和動物保健部門的營業利潤率同比增長，調整後每股攤薄收益為 0.63 美元，同比增長 9%。鑑於我們上半年的業績和我們對今年剩餘時間的預測，我們重申我們的全年每股收益指導範圍，並繼續致力於實現 23 財年的內部銷售增長和營業利潤率擴張。

Now before walking through the details of our quarter, I want to take this opportunity to share my perspective on the key elements of Patterson's success, our culture, strategy and our people. Patterson's purpose, vision and values is foundational to our success. And like our employees across Patterson, I am committed to ensuring that they are followed. We are passionate and people first, doing the right thing and being good to each other are my own beliefs that I will use to continue to guide Patterson moving forward.

現在，在詳細介紹我們季度的細節之前，我想藉此機會分享我對帕特森成功的關鍵要素、我們的文化、戰略和我們的員工的看法。帕特森的宗旨、願景和價值觀是我們成功的基礎。和我們在帕特森的員工一樣，我致力於確保他們得到遵守。我們充滿激情，以人為本，做正確的事和善待彼此是我自己的信念，我將用這些信念繼續指導帕特森前進。

In my previous role at Patterson Company's CFO, I work closely with the rest of our executive leadership team to develop the strategy that has enabled us to accelerate business performance and drive long-term value for our customers as well as our shareholders. Looking ahead, we will continue to execute that strategy, which is focused on 3 foundational pillars; first, continuously deepening the value proposition we offer our customers in both the Dental and Animal Health segments; Patterson is so much more than a distributor. We are an indispensable partner to our customers and play a critical role in their success. We believe that expanding our capabilities for customers will continue to drive sales growth strengthen these relationships.

在我之前擔任 Patterson Company 首席財務官期間，我與我們執行領導團隊的其他成員密切合作，制定戰略，使我們能夠加快業務績效並為我們的客戶和股東創造長期價值。展望未來，我們將繼續執行該戰略，該戰略側重於 3 個基本支柱；首先，不斷深化我們在牙科和動物保健領域為客戶提供的價值主張； Patterson 不僅僅是一個經銷商。我們是客戶不可或缺的合作夥伴，在他們的成功中發揮著關鍵作用。我們相信，為客戶擴展我們的能力將繼續推動銷售增長，加強這些關係。

Second, enhancing our margin performance to fully capture the value we create in the market with a focus on operational excellence improved mix and thoughtful coordination with our strategic manufacturing partners. And third, managing the organization with a keen focus on cost discipline.

其次，提高我們的利潤率表現，以充分捕捉我們在市場上創造的價值，專注於卓越運營，改進組合，並與我們的戰略製造合作夥伴進行深思熟慮的協調。第三，管理組織時高度關注成本紀律。

As you would imagine, developing a rigorous process for cost discipline and return on our investments has been a key focus for me throughout my tenure with Patterson and will continue to be in my new role. Patterson's balanced capital allocation approach supports our strategy with 3 priorities. First is investing with discipline in the core areas of our business, including our people and the support organizations to drive ongoing improvements in our field sales and service execution.

正如您想像的那樣，在我與 Patterson 的整個任期內，為成本紀律和投資回報製定嚴格的流程一直是我關注的重點，並將繼續擔任我的新角色。 Patterson 的平衡資本配置方法通過 3 個優先事項支持我們的戰略。首先是在我們業務的核心領域進行有紀律的投資，包括我們的人員和支持組織，以推動我們現場銷售和服務執行的持續改進。

These functions enable Patterson to deliver the high level of service that our customers reward us for as they navigate markets in good times and more challenging ones. Prioritizing investment ensures we don't take our foot off the gas. Second, our dividend remains an effective means of returning cash to our shareholders. As a reminder, in fiscal '22, we returned approximately $100 million to shareholders through our dividend. Third, we regularly evaluate opportunities to leverage our strong balance sheet and make strategic investments. As we've said before, we will be thoughtful and selective on opportunities that will further enhance our strategies, meet our financial criteria and drive improved returns for our shareholders. For example, in the second quarter, Patterson announced acquisitions of Dairy Tech and RSVP and ACT. These are examples of our business units identifying areas where they want to focus and using M&A to help them execute.

這些功能使 Patterson 能夠提供高水平的服務，我們的客戶在順境和更具挑戰性的市場中駕馭市場時給予我們回報。優先投資確保我們不會鬆懈。其次，我們的股息仍然是向股東返還現金的有效方式。提醒一下，在 22 財年，我們通過股息向股東返還了大約 1 億美元。第三，我們定期評估利用我們強大的資產負債表進行戰略投資的機會。正如我們之前所說，我們將深思熟慮並有選擇性地選擇機會，以進一步加強我們的戰略，滿足我們的財務標準並為我們的股東帶來更高的回報。例如，在第二季度，Patterson 宣布收購 Dairy Tech 以及 RSVP 和 ACT。這些是我們的業務部門確定他們想要關注的領域並使用併購來幫助他們執行的示例。

Our strong financial position and balance sheet provide us with flexibility to continue to pursue these opportunities to accelerate future growth and profitability. Taken together, we have a great foundation to build from. Through the continued execution of our proven strategy, I am confident in our future. Ultimately, is there people who execute on that strategy, our people are a key differentiator for Patterson, and I am so proud of the way our team supports each other and the dedication they have to serving our customers. Across our organization, we are fortunate to have a talented and driven team that is resilient and knows the power of working together to support each other.

我們強大的財務狀況和資產負債表使我們能夠靈活地繼續尋求這些機會，以加速未來的增長和盈利能力。總而言之，我們擁有堅實的基礎。通過持續執行我們行之有效的戰略，我對我們的未來充滿信心。最終，是否有人執行該戰略，我們的員工是 Patterson 的關鍵差異化因素，我為我們的團隊相互支持的方式以及他們為客戶服務所付出的奉獻精神感到非常自豪。在我們的整個組織中，我們很幸運擁有一支才華橫溢、積極進取的團隊，他們富有彈性，並且知道共同努力、相互支持的力量。

Over the past several years, Patterson has cultivated a deep bench of highly capable executive leaders. We've all been instrumental in developing and implementing Patterson's strategy. We expect continued benefit from the expertise, teamwork and continuity of our existing leadership team. I'm also pleased to keep working closely with Kevin Barry in his new capacity. As our former Vice President of Finance and Corporate Controller, Kevin has been an integral member of the executive leadership team and the finance organization. Internal promotions and succession demonstrate the depth of Patterson's talent, and Kevin is certainly a part of that.

在過去的幾年裡，帕特森培養了一批非常有能力的行政領導。我們都在製定和實施帕特森的戰略方面發揮了重要作用。我們期望繼續受益於我們現有領導團隊的專業知識、團隊合作和連續性。我也很高興繼續與凱文巴里在他的新職位上密切合作。作為我們的前財務副總裁兼企業財務總監，凱文一直是執行領導團隊和財務組織不可或缺的成員。內部晉升和繼任展示了帕特森的才華深度，而凱文無疑是其中的一部分。

I have complete confidence in his ability to take on this important responsibility. You'll have an opportunity to hear from Kevin in his remarks to walk through the details of our second quarter performance shortly. I believe our executive leadership team and strategy will enable us to maintain our strong performance. Patterson has all the elements to create value for our customers and shareholders alike, a strong position in two attractive and healthy end markets, entrenched relationships with customers that view Patterson as an indispensable partner, a clear and focused strategy to drive profitable growth and the financial foundation to ensure we can invest to position this company for long-term success.

我完全相信他有能力承擔起這一重要責任。您將有機會聽到 Kevin 在他的講話中詳細介紹我們第二季度的表現。我相信我們的執行領導團隊和戰略將使我們能夠保持強勁的業績。 Patterson 擁有為我們的客戶和股東創造價值的所有要素，在兩個有吸引力且健康的終端市場中處於強勢地位，與將 Patterson 視為不可或缺的合作夥伴的客戶建立了牢固的關係，一個明確而專注的戰略來推動盈利增長和財務基金會，以確保我們能夠投資定位這家公司以取得長期成功。

With that overview, I'll turn to a discussion of our segment's financial performance, starting with Dental. Our Dental segment grew internal sales nearly 2% Year-over-year primarily driven by strong performance in our equipment and value-added service categories. Outstanding execution by our teams enabled our Dental segment to reach double-digit operating margins and year-over-year operating margin expansion as we continue to deliver a strong mix favoring the higher-margin areas of our business.

有了這個概述，我將從牙科開始討論我們部門的財務業績。我們的牙科部門內部銷售額同比增長近 2%，這主要是由於我們的設備和增值服務類別的強勁表現。我們的團隊出色的執行力使我們的牙科部門實現了兩位數的營業利潤率和同比營業利潤率的增長，因為我們繼續提供有利於我們業務的高利潤領域的強大組合。

We remain focused on advancing and strengthening key margin enhancement initiatives by mitigating the impact of an inflationary environment strengthening our mutually beneficial vendor relationships and focusing on operational efficiencies, including mix management and logistics productivity.

我們仍然專注於通過減輕通貨膨脹環境的影響來加強我們互惠互利的供應商關係並專注於運營效率，包括混合管理和物流生產力，從而推進和加強關鍵的利潤率提高計劃。

For consumables, our internal sales in the first quarter declined mid-single digits year-over-year, primarily due to the persistent deflationary impact of certain infection control products. We continue to provide a broad range of infection control products because they are foundational to the practice of dentistry. And while the demand for these offerings is lower than the peak levels of the pandemic, it remains strong in comparison to pre-COVID levels as dentists have adapted to meet a higher standard of care.

對於消耗品，我們第一季度的內部銷售額同比下降了中個位數，這主要是由於某些感染控制產品的持續通貨緊縮影響。我們繼續提供範圍廣泛的感染控制產品，因為它們是牙科實踐的基礎。雖然對這些產品的需求低於大流行的峰值水平，但與 COVID 之前的水平相比仍然強勁，因為牙醫已經適應了更高的護理標準。

As we have previously discussed, improvements in the supply chain for infection control products have resulted in considerable pricing declines from the pandemic highs for certain products in this category. We expect this deflationary pressure in the infection control category to persist at least through the remainder of the fiscal year. Notably, Patterson achieved year-over-year internal sales growth in our non-infection control portfolio in the fiscal second quarter. We continue to leverage our broad consumables offering, including private label products to deepen our relationships with customers across the spectrum from independent private practices to regional and national DSOs.

正如我們之前所討論的，感染控制產品供應鏈的改進導致該類別中某些產品的價格從大流行高點大幅下降。我們預計感染控制類別的這種通貨緊縮壓力至少會持續到本財政年度的剩餘時間。值得注意的是，帕特森在第二財季的非感染控制產品組合中實現了同比內部銷售增長。我們繼續利用我們廣泛的消耗品產品，包括自有品牌產品，以加深我們與從獨立私人診所到區域和國家 DSO 的各個領域的客戶的關係。

We expect the overall consumables market to normalize a low single-digit percentage growth rate over the long term. Dental financial performance in the equipment category reflects what makes Patterson. Our customers recognize Patterson's expertise in supporting the full purchase training and maintenance cycle of the latest technology and equipment. They feel confident investing in their practices with Patterson as their partner, knowing they have access to hands-on support from the Patterson Technology Center and the deep knowledge and service our local branch teams provide.

我們預計，從長期來看，整體耗材市場將以個位數百分比的低增長率正常化。設備類別中的牙科財務表現反映了帕特森的成就。我們的客戶認可 Patterson 在支持最新技術和設備的完整採購培訓和維護週期方面的專業知識。他們有信心將 Patterson 作為合作夥伴投資於他們的實踐，因為他們知道他們可以獲得 Patterson 技術中心的實際支持以及我們當地分支機構團隊提供的深入知識和服務。

Internal sales in dental equipment in the second quarter were up double digits year-over-year, benefiting from improved demand for our digital equipment portfolio and continued momentum in the core equipment category. As we previously discussed, equipment sales can fluctuate quarter-to-quarter, but Patterson has delivered year-over-year equipment sales growth averaging nearly 14% for the last 8 quarters. We continue to see that dentists are making equipment investments to keep their practices running well and maintaining their planned upgrade or replacement schedules.

第二季度牙科設備的內部銷售額同比增長兩位數，這得益於對我們數字設備組合的需求增加以及核心設備類別的持續增長。正如我們之前所討論的，設備銷售可能會按季度波動，但帕特森在過去 8 個季度中的設備銷售同比增長平均接近 14%。我們繼續看到牙醫正在進行設備投資，以保持他們的實踐良好運行並維持他們計劃的升級或更換時間表。

During the second quarter, our value-added services category delivered solid high single-digit growth, driven by our field technical service offering. We're proud that our customers turn to and trust Patterson to ensure their equipment is delivering for their practice. This category also benefited from growth in the sales of our practice management software products, which our customers see as the foundation of their practice operations.

在第二季度，在我們的現場技術服務產品的推動下，我們的增值服務類別實現了穩健的高個位數增長。我們感到自豪的是，我們的客戶轉向並信任 Patterson 以確保他們的設備能夠為他們的實踐提供服務。這一類別還受益於我們的實踐管理軟件產品的銷售增長，我們的客戶將其視為他們實踐操作的基礎。

The Dental business is supported by resilient long-term trends, including an aging population, practice modernization and a growing appreciation for oral health as a key link to overall health. And we are confident in our ability to continue to effectively manage through the current macroeconomic environment to achieve our goals in fiscal '23 and beyond.

牙科業務受到彈性長期趨勢的支持，包括人口老齡化、實踐現代化以及對口腔健康作為整體健康關鍵環節的日益重視。我們相信我們有能力繼續有效地管理當前的宏觀經濟環境，以實現我們在 23 財年及以後的目標。

Let's now turn to the Animal Health segment. During the second quarter of our fiscal '23, we leverage the depth of our offering and breadth of our channel presence to deliver solid performance in the face of more challenging external market conditions. Patterson has an omnichannel presence that spans a wide range of animal species and offers a comprehensive solution for diverse customers, ranging from large producer operations with on-site veterinarians to independent VET clinics the individual shopping at their local veterinary supply retailer. Our Animal Health segment achieved internal sales growth of nearly 1% year-over-year, driven by mid-single-digit growth in companion animal and a low single-digit decline in production animal.

現在讓我們轉向動物保健部分。在 23 財年第二季度，我們利用產品的深度和渠道的廣度，在更具挑戰性的外部市場條件下提供穩健的業績。 Patterson 擁有涵蓋各種動物物種的全渠道業務，並為不同的客戶提供全面的解決方案，從擁有現場獸醫的大型生產企業到獨立的 VET 診所，再到在當地獸醫用品零售商處的個人購物。我們的動物保健部門實現了近 1% 的內部銷售額同比增長，這主要得益於伴侶動物的中個位數增長和生產動物的低個位數下降。

Despite some softness on the top line, which we attribute primarily to external factors, including staffing shortages and veterinary clinics, weather conditions impacting producers and the impact of a widely used product in the production animal market that has recently gone off patent. Patterson was still able to expand its operating margins in the Animal Health segment. Our success expanding margins was the result of our team's laser focus on mix, including the growth of our accretive private label and e-services offerings and continuing to enhance our relationships with strategic manufacturing partners who reward us for our performance.

儘管收入有些疲軟，但我們將這主要歸因於外部因素，包括人員短缺和獸醫診所、影響生產者的天氣條件以及最近專利到期的生產動物市場上廣泛使用的產品的影響。 Patterson 仍然能夠擴大其在動物保健部門的營業利潤率。我們成功擴大利潤率是我們團隊高度關注組合的結果，包括我們增值的自有品牌和電子服務產品的增長，以及繼續加強我們與戰略製造合作夥伴的關係，這些合作夥伴會獎勵我們的表現。

In our companion business, I'm particularly proud of our growth this quarter when you put our performance in context; first, the broader market growth has continued to moderate in line with our expectations; second, our results are compared to the extraordinary 21% sales growth Patterson achieved in the prior year period. We attribute the sustained outperformance of the market to our ability to serve more and more veterinary practices as they recognize the value we offer in a dynamic market environment as well as the deep relationships Patterson has with our preferred manufacturing partners and the growth of our private label portfolio.

在我們的伙伴業務中，當您將我們的業績放在背景中時，我為本季度的增長感到特別自豪；首先，大盤增長繼續放緩，符合我們的預期；其次，將我們的業績與 Patterson 去年同期實現的 21% 的非凡銷售增長進行了比較。我們將市場的持續優異表現歸功於我們為越來越多的獸醫實踐提供服務的能力，因為他們認識到我們在動態市場環境中提供的價值，以及帕特森與我們首選製造合作夥伴的深厚關係以及我們自有品牌的增長文件夾。

We're continuing to invest in the companion animal business in ways that deepen our value proposition and address critical customer needs. Last month, we announced an agreement to acquire RSVP and ACT, which stands for relief services for veterinary practitioners and animal care technologies, respectively. These are entities that provide innovative solutions to veterinary practices through data extraction and conversion, staffing and video-based training services. We believe this proposed acquisition will expand our companion animal capabilities in 3 key areas. First, ACT provides an in-house platform for data extraction and conversion capabilities which will enhance our software offerings and provide better insights, both for our business and our vet customers.

我們將繼續以深化我們的價值主張和滿足關鍵客戶需求的方式投資於伴侶動物業務。上個月，我們宣布了一項收購 RSVP 和 ACT 的協議，它們分別代表獸醫和動物護理技術的救濟服務。這些實體通過數據提取和轉換、人員配備和基於視頻的培訓服務為獸醫實踐提供創新解決方案。我們相信，此次擬議收購將擴大我們在 3 個關鍵領域的伴侶動物能力。首先，ACT 提供了一個用於數據提取和轉換功能的內部平台，這將增強我們的軟件產品並為我們的業務和我們的獸醫客戶提供更好的見解。

Second, as RSVP is a staffing business that connects short-staffed clinics to the resources they need. This acquisition will help resolve a critical pain point for clinics and address a growing trend in part-time vet and technician work. This is particularly compelling given the staffing challenges our customers are facing today.

其次，由於 RSVP 是一項人員配置業務，它將人手短缺的診所與他們所需的資源聯繫起來。此次收購將有助於解決診所的一個關鍵痛點，並應對兼職獸醫和技術人員工作日益增長的趨勢。考慮到我們的客戶如今面臨的人員配備挑戰，這一點尤其引人注目。

Finally, ACT will help Patterson expand its educational offerings including the addition of a state recognized certification program for vet assistance. As we've previously discussed, our established education platform, Patterson Veterinary University is a key component of our value proposition for companion animal customers, working alongside customers to help them establish and enhance their practices lays the foundation for a meaningful long-term partnership.

最後，ACT 將幫助 Patterson 擴展其教育產品，包括增加國家認可的獸醫援助認證計劃。正如我們之前所討論的，我們建立的教育平台帕特森獸醫大學是我們為伴侶動物客戶提供的價值主張的重要組成部分，與客戶一起幫助他們建立和加強他們的實踐，為有意義的長期合作夥伴關係奠定了基礎。

Importantly, we remain confident in the long-term growth opportunity of the companion animal market. Data shows that today's pet parents are increasingly dedicated to the health and well-being of their pets and willing to invest in the care that veterinarians provide. We believe that over the long term, people who own pets will continue to invest in their care throughout the pet's lifetime and own more pets during their life. On the production animal side, our internal sales performance was challenged by the impact of pricing pressures on a broadly used product, Draxxin that now faces generic competition. While this pricing pressure was not unexpected in the market, it still had an effect on our internal sales. Excluding the deflationary impact of this product, our production animal sales were up about 1%, reflecting positive fundamental growth over the extraordinarily strong 11% growth in the prior year comparative period.

重要的是，我們對伴侶動物市場的長期增長機會充滿信心。數據顯示，如今的寵物父母越來越重視寵物的健康和福祉，並願意投資於獸醫提供的護理。我們相信，從長遠來看，養寵物的人會在寵物的一生中繼續投資於他們的護理，並在他們的一生中擁有更多的寵物。在生產動物方面，我們的內部銷售業績受到定價壓力對廣泛使用的產品 Draxxin 的影響的挑戰，該產品現在面臨仿製藥競爭。雖然這種定價壓力在市場上並不意外，但它仍然對我們的內部銷售產生了影響。排除該產品的通貨緊縮影響，我們的生產動物銷售額增長了約 1%，反映了與去年同期 11% 的異常強勁增長相比的積極基本面增長。

We attribute our positive financial performance in the production business to Patterson's service model in a market where we believe customers generally prefer to develop a long-term relationship with a single supply partner. We provide producers with a customized combination of hands-on service and delivery options and a comprehensive product and service portfolio, which they increasingly demand. Our differentiated model has continued to enable us to win new customers and outperform the broader production animal market. and we are focused on continuing to differentiate Patterson with the addition of new critical capabilities.

我們將我們在生產業務中的積極財務業績歸因於帕特森在我們認為客戶通常更願意與單一供應合作夥伴建立長期關係的市場中的服務模式。我們為生產商提供定制化的實踐服務和交付選項組合，以及他們日益需要的全面的產品和服務組合。我們的差異化模式繼續使我們能夠贏得新客戶並跑贏更廣泛的生產動物市場。我們專注於通過增加新的關鍵功能來繼續使 Patterson 脫穎而出。

Our recently announced agreement to acquire Dairy Tech is expected to expand our value-added platform within our production animal business. Dairy Tech provides pasteurizing equipment and single-use bags to safely produce store and feed colostrum, a necessary nutrient for newborn calfs. This is a critical capability for our cattle producer customers and we expect our acquisition of Dairy Tech to efficiently and effectively support the health of the producers herd. We believe this acquisition will align well with several key trends we're observing in the market, including producers looking for more efficient ways to manage costs and improve profitability, a continued market emphasis on Biosecurity and herd health and strong global demand for protein and dairy.

我們最近宣布的收購 Dairy Tech 的協議預計將擴大我們在生產動物業務中的增值平台。 Dairy Tech 提供巴氏殺菌設備和一次性袋子，以安全地生產儲存和飼餵初乳，初乳是新生小牛的必需營養素。這對我們的養牛生產商客戶來說是一項關鍵能力，我們希望我們對 Dairy Tech 的收購能夠有效地支持養牛生產者的健康。我們相信此次收購將與我們在市場上觀察到的幾個主要趨勢保持一致，包括生產商尋求更有效的方法來管理成本和提高盈利能力、市場對生物安全和畜群健康的持續重視以及全球對蛋白質和乳製品的強勁需求.

As we look ahead to the rest of fiscal '23, our Animal Health business will continue to focus on accelerating our momentum of strong sales execution, operational excellence and deepening our value proposition to better serve our customers.

展望 23 財年的剩餘時間，我們的動物保健業務將繼續專注於加速我們強勁的銷售執行、卓越運營和深化我們的價值主張以更好地為客戶服務的勢頭。

And now I will turn the call over to Kevin to discuss our fiscal '23 second quarter financial performance in more detail.

現在我將把電話轉給凱文，更詳細地討論我們 23 財年第二季度的財務業績。

Thank you, Don, and good morning, everyone. Let me begin with a sincere thank you to Don and our Board for the opportunity to serve in this new role. I'm also grateful for the increasing levels of responsibility and for momentary Don has given me over the past several years. and it's a privilege to be a part of a very talented and committed leadership team here at Patterson. In my prepared remarks this morning, I will cover the financial results for our second quarter of fiscal '23, which ended on October 29, 2022, and then conclude with a few comments on our outlook for the remainder of the fiscal year.

謝謝你，唐，大家早上好。首先，讓我衷心感謝 Don 和我們的董事會讓我有機會擔任這一新角色。我也很感激唐在過去幾年裡給我的責任越來越大，也很感激。很榮幸能成為 Patterson 非常有才華和忠誠的領導團隊的一員。在今天上午準備好的發言中，我將介紹我們截至 2022 年 10 月 29 日的 23 財年第二季度的財務業績，然後對我們對本財年剩餘時間的展望發表一些評論。

So let's begin by covering the results for our second quarter of fiscal '23. Consolidated reported sales for Patterson Companies in our fiscal '23 second quarter were $1.63 billion, a decrease of 1.4% versus the second quarter one year ago. Internal sales, which are adjusted for the effects of currency translation, increased 0.7% compared to the same period last year.

因此，讓我們首先介紹 23 財年第二季度的結果。 Patterson Companies 在我們 23 財年第二季度的合併報告銷售額為 16.3 億美元，與一年前的第二季度相比下降了 1.4%。經貨幣換算影響調整後的內部銷售額同比增長 0.7%。

Our second quarter fiscal '23 gross margin was 20.2%, an increase of 40 basis points compared to the prior year. Our gross margin was negatively impacted by 60 basis points this quarter by the mark-to-market accounting adjustment from rising interest rates on our equipment financing portfolio. However, this negative impact was nearly offset by the gain in our corresponding hedging instrument, which is reflected in the interest and other expense line on our P&L. So the net result has a minimal impact on our adjusted earnings per share. This dynamic also occurred in the second fiscal quarter of last year when the negative impact of the mark-to-market accounting calculation was 20 basis points. We're normalizing for the negative impact in both periods for an alternative view of how our business is operating.

我們第二季度的 23 財年毛利率為 20.2%，與去年同期相比增加了 40 個基點。本季度我們的毛利率受到 60 個基點的負面影響，原因是我們的設備融資組合利率上升導致按市值計算的會計調整。然而，這種負面影響幾乎被我們相應對沖工具的收益所抵消，這反映在我們損益表的利息和其他費用項目中。因此，淨結果對我們調整後的每股收益的影響微乎其微。這種動態也發生在去年第二財季，當時按市值計算的會計計算的負面影響為 20 個基點。我們正在對這兩個時期的負面影響進行標準化，以換一種方式看待我們的業務運作方式。

Our gross margin is up 80 basis points compared to the prior year. This increase in gross margin reflects our continued focus on pricing and cost execution and driving an improved mix with higher growth of margin-accretive product categories. Adjusted operating expenses as a percentage of net sales for the second quarter of fiscal '23 were 15.9% and unfavorable by 60 basis points compared to one year ago.

與上一年相比，我們的毛利率上升了 80 個基點。毛利率的增長反映了我們對定價和成本執行的持續關注，並通過提高利潤率的產品類別的更高增長推動了產品組合的改善。 23 財年第二季度調整後的運營費用占淨銷售額的百分比為 15.9%，與一年前相比下降了 60 個基點。

In the fiscal '23 second quarter, our consolidated adjusted operating margin was 4.3%, a decline of 20 basis points compared to the second quarter of last year. Again, normalizing for the negative impact from the mark-to-market valuation of our equipment financing portfolio, our consolidated adjusted operating margins for the fiscal second quarter improved by 30 basis points compared to the prior year. We remain focused on driving continued operating margin expansion through our efforts improve gross margin with pricing and cost execution, working more closely with strategic vendors who reward us for our sales performance, driving improved mix as well as exercising expense discipline and leveraging our cost structure as we grow the top line.

在 23 財年第二季度，我們的綜合調整後營業利潤率為 4.3%，與去年第二季度相比下降了 20 個基點。同樣，由於我們的設備融資組合按市值計價的負面影響正常化，我們第二財季的綜合調整後營業利潤率比上一年提高了 30 個基點。我們仍然專注於通過我們通過定價和成本執行來提高毛利率，與獎勵我們的銷售業績的戰略供應商更緊密地合作，推動改善組合以及行使費用紀律和利用我們的成本結構來推動持續的營業利潤率增長我們增加了收入。

With these collective efforts, we intend to deliver operating margin expansion in both of our business segments and our total business for fiscal '23. Our adjusted tax rate for the second quarter of fiscal '23 was 24.2%, a decrease of 80 basis points compared to the prior year. For the full year, we expect our tax rate to be in line with prior year.

通過這些集體努力，我們打算在 23 財年實現兩個業務部門和整體業務的營業利潤率增長。我們在 23 財年第二季度調整後的稅率為 24.2%，比上年下降 80 個基點。對於全年，我們預計我們的稅率與上一年持平。

Reported net income attributable to Patterson Companies, Inc. for the second quarter of fiscal '23 was $54.1 million or $0.55 per diluted share. This compares to reported net income in the second quarter of last year of $48.3 million or $0.49 per diluted share.

2023 財年第二季度歸屬於帕特森公司的報告淨收入為 5410 萬美元或每股攤薄收益 0.55 美元。相比之下，去年第二季度報告的淨收入為 4830 萬美元或每股攤薄收益 0.49 美元。

Adjusted net income attributable to Patterson Companies, Inc. in the second quarter of fiscal '23 was $61.2 million or $0.63 per diluted share. This compares to $57.1 million or $0.58 per diluted share in the second quarter of fiscal '22. This increase was primarily due to the operating margin expansion in both of our business segments.

2023 財年第二季度歸屬於帕特森公司的調整後淨收入為 6120 萬美元或每股攤薄收益 0.63 美元。相比之下，22 財年第二季度為 5710 萬美元或攤薄後每股 0.58 美元。這一增長主要是由於我們兩個業務部門的營業利潤率擴張。

Now let's turn to our business segments, starting with our Dental business. In the second quarter of fiscal '23, internal sales for our Dental business increased 1.6% compared to the second quarter of fiscal '22. Internal sales of dental consumables declined 4.9% compared to one year ago. As Don mentioned earlier, we continue to experience the deflationary impact of infection control products compared to the prior year. Internal sales of non-infection control products increased 1.0% in the fiscal second quarter compared to the year ago period. We expect the deflationary impact of infection control products to continue for the remainder of fiscal '23.

現在讓我們轉向我們的業務部門，從我們的牙科業務開始。在 23 財年第二季度，我們牙科業務的內部銷售額與 22 財年第二季度相比增長了 1.6%。與一年前相比，牙科耗材的內部銷售額下降了 4.9%。正如唐之前提到的，與前一年相比，我們繼續經歷感染控制產品的通貨緊縮影響。與去年同期相比，第二財季非感染控制產品的內部銷售額增長了 1.0%。我們預計感染控制產品的通貨緊縮影響將持續到 23 財年的剩餘時間。

Internal sales of dental equipment and software increased 11.1% compared to one year ago. In core equipment, our double-digit sales increase in the quarter reflects our continued efforts to manage the supply chain in this category to deliver and install the equipment our dental customers have ordered to update their practices or open new dental offices.

與一年前相比，牙科設備和軟件的內部銷售額增長了 11.1%。在核心設備方面，我們本季度的兩位數銷售額增長反映了我們繼續努力管理此類供應鏈，以交付和安裝我們的牙科客戶訂購的設備，以更新他們的做法或開設新的牙科診所。

Sales of digital equipment products were also up double digits and sales of CAD/CAM products declined mid-single digits in the quarter. Internal sales of value-added services in the second quarter of fiscal '23 increased 7.8% over the prior year period, led by the strong year-over-year performance of our technical service team and double-digit growth of our software business. Value-added services represent the entire suite of offerings we provide to our customers that help make us an indispensable partner to their practice, and these valuable offerings are also mix favorable to our P&L.

本季度數字設備產品的銷售額也增長了兩位數，而 CAD/CAM 產品的銷售額下降了中等個位數。 23 財年第二季度增值服務的內部銷售額比上年同期增長 7.8%，這得益於我們技術服務團隊的強勁同比表現和我們軟件業務的兩位數增長。增值服務代表了我們為客戶提供的全套服務，幫助我們成為他們實踐中不可或缺的合作夥伴，這些有價值的服務也有利於我們的損益。

Adjusted operating margins in Dental were 10.2% in the fiscal second quarter and a 90 basis point improvement over the prior year period. This strong performance reflects the efforts of our dental team to improve gross margins and exercise continued expense discipline compared to the prior year period. Now let's move on to our Animal Health segment. In the second quarter of fiscal '23, Internal sales for our Animal Health business increased 0.7% compared to the second quarter of fiscal '22. Internal sales for our companion animal business increased 3.5% with the U.S. companion animal business growing by 4.5% in the quarter.

第二財季牙科業務的調整後營業利潤率為 10.2%，比去年同期提高 90 個基點。與去年同期相比，這一強勁表現反映了我們的牙科團隊為提高毛利率和持續實施費用控制所做的努力。現在讓我們繼續我們的動物保健部分。在 23 財年第二季度，我們動物保健業務的內部銷售額比 22 財年第二季度增長了 0.7%。我們的伴侶動物業務的內部銷售額增長了 3.5%，美國伴侶動物業務在本季度增長了 4.5%。

Internal sales for our production animal business decreased 2.3% in the quarter compared to the prior year as the production animal market has been affected by the deflationary impact of a key branded product that recently came off patent and as Don mentioned, is now experiencing generic competition. Excluding this deflationary impact, internal sales for our production animal business increased by 0.7%, and industry data would indicate that our sales team and production continues to outperform the overall market during the fiscal second quarter. Adjusted operating margins in our Animal Health segment were 3.8% in the fiscal second quarter, an increase of 40 basis points from the prior year. Our Animal Health team continues to drive business with strategic manufacturer partners who value our ability to move market share while also exercising expense discipline.

我們的生產動物業務的內部銷售額在本季度比去年同期下降了 2.3%，因為生產動物市場受到最近專利到期的主要品牌產品的通貨緊縮影響的影響，正如 Don 提到的，現在正在經歷仿製藥競爭.排除這種通貨緊縮的影響，我們生產動物業務的內部銷售額增長了 0.7%，行業數據表明我們的銷售團隊和生產在第二財季繼續跑贏整體市場。第二財季，我們動物保健部門的調整後營業利潤率為 3.8%，比上年增長 40 個基點。我們的動物保健團隊繼續推動與戰略製造商合作夥伴的業務，他們重視我們提高市場份額的能力，同時也遵守費用紀律。

Now let me cover cash flow and balance sheet items. During the first 6 months of fiscal '23, our free cash flow declined by $88.4 million compared to the same period one year ago. This was primarily due to an increased level of working capital in the first 6 months of fiscal '23 driven by strategic inventory purchases and timing of accounts payable.

現在讓我談談現金流和資產負債表項目。在 23 財年的前 6 個月，我們的自由現金流與一年前同期相比減少了 8840 萬美元。這主要是由於 23 財年前 6 個月的營運資金水平增加，這是由於戰略性庫存採購和應付賬款的時間安排所致。

Now turning to capital allocation. We continue to execute on our strategy to return cash to shareholders. In the second quarter of fiscal '23, we declared a quarterly cash dividend of $0.26 per diluted share, which was then paid in the third quarter of fiscal '23. On a year-to-date basis, Patterson has returned $65.7 million to shareholders through dividends and share repurchases. Also during the second fiscal quarter, as previously disclosed, we successfully amended and extended our credit facility. Even in this challenging credit environment, we achieved favorable terms while maintaining our existing lending group, demonstrating the confidence our lenders have in the ongoing strength of our business. This new facility provides the capacity and flexibility to continue investing in our core business and to execute on strategic transactions.

現在轉向資本配置。我們繼續執行我們的戰略，向股東返還現金。在 23 財年第二季度，我們宣布了每稀釋股 0.26 美元的季度現金股息，然後在 23 財年第三季度支付。從年初至今，帕特森已通過股息和股票回購向股東返還了 6570 萬美元。同樣在第二財政季度，如前所述，我們成功地修改和擴展了我們的信貸額度。即使在這個充滿挑戰的信貸環境中，我們在維持現有貸款集團的同時也取得了優惠條件，表明我們的貸方對我們業務的持續實力充滿信心。這個新設施提供了繼續投資我們的核心業務和執行戰略交易的能力和靈活性。

Let me conclude with some comments on our outlook for fiscal '23. Today, we are reaffirming our fiscal '23 GAAP earnings guidance of $1.96 to $2.06 per diluted share, and our adjusted earnings guidance of $2.25 to $2.35 per diluted share. We intend to deliver internal sales growth and operating margin expansion for fiscal '23 and remain committed to achieving our guidance for the fiscal year.

最後，讓我對我們對 23 財年的展望發表一些評論。今天，我們重申 23 財年 GAAP 每股攤薄收益 1.96 美元至 2.06 美元的收益指引，以及調整後每股攤薄收益 2.25 美元至 2.35 美元的收益指引。我們打算在 23 財年實現內部銷售增長和營業利潤率擴張，並繼續致力於實現我們對本財年的指導。

And now I will turn the call back over to Don for some additional comments.

現在我將把電話轉回給 Don，徵求一些額外的意見。

Thanks, Kevin. A few final comments before we open it up for Q&A. First, I want to again thank the entire Patterson team. I'm proud of their work in delivering another strong quarter and their dedicated focus on supporting our customers. Second, despite macroeconomic challenges, the performance of this quarter demonstrates the strength of our strategy, the discipline and execution of our talented team and continued momentum within our end markets. With this winning combination, I'm confident in Patterson's ability to succeed in any environment and look forward to what we can accomplish together. That concludes our prepared remarks.

謝謝，凱文。在我們打開它進行問答之前，還有一些最後的評論。首先，我要再次感謝整個帕特森團隊。我為他們在提供另一個強勁季度方面所做的工作以及他們專注於支持我們的客戶而感到自豪。其次，儘管面臨宏觀經濟挑戰，但本季度的業績證明了我們戰略的實力、我們才華橫溢的團隊的紀律和執行力以及我們終端市場的持續發展勢頭。有了這個成功的組合，我對帕特森在任何環境中取得成功的能力充滿信心，並期待我們一起取得成功。我們準備好的發言到此結束。

Kevin and I we glad to take questions. Operator, please open the line.

凱文和我很高興接受提問。接線員，請打開線路。

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

（操作員說明）您的第一個問題來自 Piper Sandler 的 Jason Bednar。

Don and Kevin, 2-part question here upfront. I want to make sure we all understand the accounting mechanics of how rising rates influence the mark-to-market dynamics with respect to your equipment financing portfolio. You mentioned, I think, a 60 basis point headwind. It looks like most of this reverse in the other income line, but we there's nothing else that's layering into that line as a onetime item. And then the second part of the question is whether you're reaffirming your view for operating margin expansion for the total company in spite of the mark-to-market headwinds that hit the hit the number here in Q2. I'm sorry if I missed that, but I just wanted to confirm that.

唐和凱文，前面有兩部分問題。我想確保我們都了解利率上升如何影響設備融資組合的按市值計算動態的會計機制。我認為你提到了 60 個基點的逆風。看起來在另一條收入線中大部分情況都是相反的，但我們沒有其他任何東西作為一次性項目分層到該線中。然後問題的第二部分是你是否重申你對整個公司營業利潤率擴張的看法，儘管按市值計價的逆風在第二季度達到了這裡的數字。如果我錯過了，我很抱歉，但我只是想確認一下。

Yes, Jason, thanks. This is Don. You're right. We did have another quarter, and we've had this first several quarters now in a row with the rising interest rate environment. What happens is our equipment portfolio gets mark-to-market, and that happens above the operating profit line in the gross margin. And so you saw that in the -- you saw that impact. So we had a 40 basis point increase in gross margin, but without the mark-to-market adjustment, it was 80 basis points. And then that comes in and the other income expense line down below and that's almost a perfect offset to that impact. So at the bottom line, it's negative or it's neutral. So you're right on that.

是的，傑森，謝謝。這是唐。你是對的。我們確實有另一個季度，在利率上升的環境下，我們已經連續度過了前幾個季度。發生的事情是我們的設備組合按市值計價，這發生在毛利率的營業利潤線以上。所以你看到了——你看到了那種影響。因此，我們的毛利率增加了 40 個基點，但在沒有按市值調整的情況下，毛利率增加了 80 個基點。然後出現，其他收入支出線在下方，這幾乎是對這種影響的完美抵消。所以歸根結底，它是負面的或中性的。所以你是對的。

And then in terms of reaffirming our guidance, yes, when we talk about operating margin expansion year-over-year, I would look at it as ex the impact of the mark-to-market. We probably will do it anyway, but just going to depend on the interest rate movements for the rest of the year and how that impacts the equipment portfolio. I don't know, Kevin, if you have anything you want to add to that?

然後就重申我們的指導而言，是的，當我們談論營業利潤率同比增長時，我會將其視為按市值計價的影響。無論如何，我們可能會這樣做，但這取決於今年剩餘時間的利率變動以及這對設備組合的影響。我不知道，凱文，你是否有什麼要補充的？

The one point I'd add, Jason, is that this dynamic is fully held within our corporate segment. And so when you heard us say that both business segments, Dental and Animal Health expanded their margins this quarter that doesn't have any of the impact from this mark-to-market dynamic. So both of them had very strong gross margin and operating margin performance this quarter.

傑森，我要補充的一點是，這種動態完全存在於我們的企業部門。因此，當您聽到我們說牙科和動物保健這兩個業務部門本季度都擴大了利潤率，而這種按市值計算的動態沒有任何影響。因此，他們本季度的毛利率和營業利潤率都非常強勁。

All right. Yes. Understood. Very, very helpful there. Okay. On the 2 acquisitions you announced recently, they it looks somewhat small, but strategic, not terribly risky or splashy. I guess, Don, is this the right way to think about the M&A strategy you have in mind? And I can't help but look at sequencing of events here, but these acquisitions came shortly after you took over as CEO. And do you see yourself as being generally more aggressive than your predecessor in bringing external assets in-house?

好的。是的。明白了。在那裡非常非常有幫助。好的。在您最近宣布的 2 項收購中，它們看起來規模較小，但具有戰略意義，風險不大或引人注目。我想，Don，這是考慮您心目中的併購戰略的正確方法嗎？我不禁要看看這裡的事件順序，但這些收購是在你接任首席執行官後不久發生的。在將外部資產引入內部方面，您是否認為自己通常比前任更積極？

I wouldn't say that. I think we've been -- we have a robust process for identifying acquisition candidates. And that's really been in place, I think, for the last 2 years once they got here, we were not really prepared with our balance sheet or, frankly, internally to take on acquisitions, particularly multiple acquisitions. But over the last 2 years, we've been pretty aggressive in trying to identify the right candidates. And so that's just more of a timing thing, frankly.

我不會那樣說。我認為我們已經 - 我們有一個強大的流程來確定收購候選人。我認為，在過去的兩年裡，一旦他們來到這裡，我們就沒有真正準備好我們的資產負債表，或者坦率地說，在內部進行收購，特別是多次收購。但在過去的 2 年裡，我們一直在積極尋找合適的候選人。坦率地說，這更像是一個時機問題。

In terms of how these fit into the strategy, I think they fit in really well for us. Our main thing is deepening our value proposition with our customers. These are right in the middle of the fairway for that kind of thing. And so size may differ, but I think you can look at these as a great example of the kind of acquisitions that can help us going forward.

就這些如何融入戰略而言，我認為它們非常適合我們。我們的主要任務是深化我們對客戶的價值主張。對於那種事情，這些就在球道的中間。所以規模可能會有所不同，但我認為你可以將這些視為可以幫助我們前進的那種收購的一個很好的例子。

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

你的下一個問題來自高盛的 Nathan Rich。

I guess looking at the dental consumables growth of 1%, excluding PPE. Could you maybe talk about how that breaks down between volume and price? And then Don, I think last quarter, you had pointed to slowing traffic and spend per visit as a risk to the dental end market. Just curious to get your updated thoughts on how that progress or played out during the quarter?

我猜牙科耗材增長 1%，不包括 PPE。你能談談它是如何在數量和價格之間分解的嗎？然後唐，我想上個季度，你指出流量放緩和每次訪問的支出是牙科終端市場的風險。只是想知道您對本季度如何取得進展或發揮作用的最新想法？

Sorry, what was the -- just can you reiterate the last question?

抱歉，你能重申一下上一個問題嗎？

Yes. Yes. I think on your last quarterly call, you had talked about the potential for slowing traffic and spend per visit at the dental practice. Just curious to get your updated thoughts there.

是的。是的。我想在你上次的季度電話會議上，你談到了減緩交通流量和牙科診所每次就診費用的可能性。只是想知道您的最新想法。

Well, maybe we'll start there and then see if Kevin has some data he wants to give on PPE. I think right now, we're viewing patient traffic in the dental business as steady or stable I mean that's the way I would look at it. And in terms of spend per visit, I'd probably say the same thing. I think we're really just seeing a pretty stable environment right now in that part of the business.

好吧，也許我們會從那裡開始，然後看看凱文是否有一些他想提供的個人防護裝備數據。我認為現在，我們認為牙科業務的患者流量穩定或穩定，我的意思是我會這樣看待它。就每次訪問的花費而言，我可能會說同樣的話。我認為我們現在真的只是在這部分業務中看到一個相當穩定的環境。

Yes. And to your question about price and mix, we have had some inflation in the -- our acquisition cost that in the non-PPE area. I wouldn't describe it as significant. It's certainly not as high as what you see in some of the headline inflation numbers, but it's there. So that certainly is built into our sales growth this quarter. But like Don said, when we look at the end markets and what our customers are seeing in their practices, we see a pretty stable market for demand in the dental business.

是的。對於你關於價格和組合的問題，我們在非 PPE 領域的購置成本有一些通貨膨脹。我不會把它描述為重要的。它肯定沒有你在一些標題通貨膨脹數據中看到的那麼高，但它確實存在。因此，這肯定是我們本季度銷售增長的一部分。但正如 Don 所說，當我們審視終端市場以及我們的客戶在他們的實踐中看到的情況時，我們看到牙科業務的需求市場非常穩定。

Okay. Great. And then if I could just ask on the Dental equipment side. I think in the prepared remarks, you talked about improved demand for digital equipment. Could you maybe dig into a little bit more detail there? And I guess I would maybe -- does that mean, I guess, digital equipment kind of outpaced that 11% overall Dental equipment growth, and I guess I'd be a little bit surprised just given some of the commentary around pricing pressure we've seen in that category. So could you maybe just unpack that a little bit further for us?

好的。偉大的。然後我是否可以只問牙科設備方面的問題。我想在準備好的發言中，你談到了對數字設備的需求增加。您能否在那裡深入了解更多細節？我想我可能會——這是否意味著，我想，數字設備有點超過 11% 的整體牙科設備增長，我想我會有點驚訝，因為我們對定價壓力發表了一些評論我在該類別中看到過。那麼，您能不能為我們進一步解壓一下？

Yes. I mean it's a 3-month period. So we try to look at this over a longer period of time. But we had a -- we feel like that was an excellent part of the print here for us today. And so it did outpace the rest of the equipment growth. I think CAD/CAM was down, as we mentioned, digital was up. I think what it really points to is just the resiliency of our full equipment portfolio. I think we feel like we have a competitive advantage here. We have a particular skill in this area. And this is what we've seen really several times here is some categories are up, some are down each quarter. It just kind of depends on timing. I think the main data point from my perspective is when you look at the last 8 quarters, we're up 14%. And again, that's a time period that we can get our arms around and say, we think that we're executing in this area at a really high level.

是的。我的意思是這是一個3個月的時間。因此，我們嘗試在更長的時間內審視這一點。但是我們有一個 - 我們覺得這是今天印刷品的一個很好的部分。因此它確實超過了其他設備的增長。我認為 CAD/CAM 下降了，正如我們提到的，數字上升了。我認為它真正指向的只是我們完整設備組合的彈性。我認為我們覺得我們在這裡具有競爭優勢。我們在這方面有特殊的技能。這就是我們在這裡多次看到的情況，有些類別在每個季度都在上升，有些類別在下降。這只是有點取決於時機。我認為從我的角度來看，主要數據點是過去 8 個季度，我們上漲了 14%。再一次，那是一個我們可以擁抱並說的時間段，我們認為我們在這個領域的執行水平非常高。

Your next question comes from the line of Jeff Johnson from Baird.

你的下一個問題來自 Baird 的 Jeff Johnson。

I missed the first part of the call, so I don't want to ask anything you might have already covered. But let me just ask, I guess, one higher level question. And Don, that's on the makeup of the business. You've had some changes at the dental leadership level recently, I think at least one outsider who had probably advocated for some bigger changes recently left. So we know the Board has long been a pretty conservative Board. So I guess, Don, now that you're in the CEO chair, where do you sit between maybe that conservative Board maybe tacking to things like private label, self-manufacturing of dental products, dental outside of North America, just kind of those bigger picture issues that could maybe move the sales force away from kind of that transactional approach that's long been there. and more maybe to a consultative approach and into some of these kind of newer areas of dental?

我錯過了電話的第一部分，所以我不想問您可能已經介紹過的任何內容。但我想，讓我問一個更高層次的問題。唐，這就是公司的構成。你最近在牙科領導層發生了一些變化，我認為至少有一位可能最近主張進行一些更大變化的局外人離開了。所以我們知道董事會長期以來一直是一個非常保守的董事會。所以我想，Don，既然你已經擔任了 CEO 主席，那麼你坐在哪個位置之間，也許保守的董事會可能會處理自有品牌、牙科產品的自我製造、北美以外的牙科等事情更大的問題可能會使銷售人員遠離長期以來一直存在的那種交易方式。也許更多的是採用諮詢方法並進入這些較新的牙科領域？

Yes, Jeff. I won't comment on the Board. But I mean, we -- I think if you look at our strategy that we've had for the last couple of years, obviously, I was a big part of that, along with the rest of the leadership team. So I don't expect that to change significantly. I think that even though it may have not have shown up yet, as I mentioned, we've been, I think, aggressive in terms of looking at the other kinds of opportunities, the M&A opportunities, other ways to enhance our strategy. And my view, and I don't think this is different than where we've been, but I want to be aggressive in both the Dental and Animal health space in really deepening our value proposition.

是的，傑夫。我不會對董事會發表評論。但我的意思是，我們——我想如果你看看我們過去幾年的戰略，顯然，我和領導團隊的其他成員是其中的重要組成部分。所以我不希望這種情況發生重大變化。我認為，儘管它可能還沒有出現，但正如我所提到的，我認為我們在尋找其他類型的機會、併購機會以及其他增強我們戰略的方式方面一直很積極。我的觀點是，我認為這與我們一直以來的情況沒有什麼不同，但我想在牙科和動物健康領域積極進取，真正深化我們的價值主張。

We know how to pick pack and ship but we're on the search and continuing journey to continue to deepen that. And I think that's our focus, and I think if you got into our meetings and some of the things we're doing, you'd find it to be a more aggressive discussion than it may come across.

我們知道如何挑選包裝和運輸，但我們正在尋找和繼續深化這一過程。我認為這是我們的重點，我認為如果你參加我們的會議和我們正在做的一些事情，你會發現這是一個比它可能遇到的更積極的討論。

Yes. Do you feel Don on at all like you are even more supportive of kind of that evolution of Patterson and of where kind of dental distribution probably needs to go over the next 5 or 10 years? Then maybe past leadership? Is there any change that we should expect in your mentality or support of kind of that, again, what I think is needed evolution versus maybe past leadership?

是的。您是否覺得 Don 更支持 Patterson 的這種演變以及未來 5 年或 10 年可能需要進行的牙科分佈？那麼也許是過去的領導？我們是否應該期望您的心態或支持有任何變化，我認為與過去的領導相比需要進化嗎？

Yes. I wouldn't want to stack myself up exactly, but I think when we look at our strategy, like I said, there's a -- we're fully bought into the idea of we're not just a distributor. I mean when we talk about being an indispensable partner to our customers, that really is where we're at. And the best way to do that. And I think is to really how do you deepen the value proposition. And I think we're -- you can kind of see it starting to take hold and continue is on our margin performance and how it's impacting our margins. We're really being diligent about how we look at each customer and kind of the holistic view of that. And those efforts are paying off quarter after quarter now on the margin expansion side.

是的。我不想把自己完全堆砌起來，但我認為當我們審視我們的戰略時，就像我說的那樣——我們完全相信我們不僅僅是一個分銷商。我的意思是，當我們談論成為客戶不可或缺的合作夥伴時，這確實是我們所處的位置。以及做到這一點的最佳方式。我認為真正是如何深化價值主張。而且我認為我們 - 你可以看到它開始佔據並繼續影響我們的利潤率表現以及它如何影響我們的利潤率。我們真的很勤奮地了解我們如何看待每個客戶以及對此的整體看法。現在，這些努力在利潤率擴張方面正在一個季度又一個季度地得到回報。

Your next question comes from the line of A.J. Rice from Credit Suisse.

你的下一個問題來自 A.J.來自瑞士信貸的大米。

Just first question around the comments around PPE. It sounds like from here through the rest of the fiscal year, you're thinking you'll still experience deflationary pressure, but the order -- the volumes are stabilized. Is that the right takeaway? And then on that deflationary aspect, is that year-over-year, but sequentially, pricing is stabilizing? Or is pricing on a sequential quarterly basis still coming down?

只是首先質疑圍繞 PPE 的評論。聽起來從現在到整個財政年度的剩餘時間，你認為你仍然會遇到通貨緊縮壓力，但訂單 - 數量穩定。這是正確的外賣嗎？然後在通貨緊縮方面，價格是否逐年但連續地穩定？還是按季度連續定價仍在下降？

Yes. Well, what we're seeing is pricing is coming down sequentially. I think when we look at the volume implications, we think when all is said and done here that volumes are going to be above pre-pandemic levels. But the pricing continues to moderate. And as we go -- and we think that, that should hopefully abate at the end of this fiscal year. The impact going forward is going to be that on a year-over-year comparison that will move into next year just because of the dynamics of how it's declined this year. I don't know, Kevin, if you want to add anything to that?

是的。好吧，我們看到的是價格正在依次下降。我認為，當我們查看數量影響時，我們認為當一切都說完之後，數量將超過大流行前的水平。但定價繼續放緩。隨著我們的前進 - 我們認為，這應該有望在本財政年度結束時減少。未來的影響將是對將進入明年的同比比較的影響，這僅僅是因為今年下降的動態。我不知道，凱文，你是否想補充什麼？

Yes. No, that's right. It's primarily a gloves issue for us. And like Don said, what we've seen is the pricing on those products has started to stabilize a bit. But because they are lower than they were a year ago, we're going to have a comparison issue for the next couple of quarters here as we kind of work through that dynamic.

是的。不，沒錯。這對我們來說主要是手套問題。就像 Don 所說的那樣，我們所看到的是這些產品的定價已經開始趨於穩定。但是因為它們比一年前低，我們將在接下來的幾個季度中遇到一個比較問題，因為我們正在努力解決這種動態問題。

Okay. Maybe just the other follow-up question would be, when you guys talk about the sort of macro challenges of inflation, interest rate rising and then sort of the uncertainty about the economy generally. I understand the issues you have on inflation and I understand the issues you have the interest rates rising presents with financing and so forth. But what about the slowdown in the economy, it's hard for me to look at your numbers and see that you're seeing any impact there. Consumables you're describing is steady and your equipment orders are strong. So is there any place today that you feel the economic uncertainty is impacting the business? Or is it more of we're just mindful of this and we're keeping an eye on it.

好的。也許另一個後續問題是，當你們談論通貨膨脹、利率上升以及總體經濟的不確定性等宏觀挑戰時。我理解你在通貨膨脹方面遇到的問題，我理解你遇到的利率上升帶來的融資等問題。但是關於經濟放緩，我很難看你的數字並看到你在那裡看到任何影響。您描述的消耗品穩定，設備訂單強勁。那麼今天有沒有什麼地方讓您覺得經濟不確定性正在影響業務？或者更多的是我們只是注意到這一點並且我們正在關注它。

I would characterize it more as the latter. Obviously, when we talk about impacts on our market and the macroeconomic conditions, relative to the markets we're in. I mean, I think it's kind of on the margin. The thing we like about our portfolio, the thing we like about being in both the Dental and Animal health business and frankly, all 3 businesses, if you really break Animal Health down into companion and production is -- these are resilient markets. They've proven that in the past. I think -- and that's proving out here now. So that's how we would look at it.

我更願意將其描述為後者。顯然，當我們談論對我們的市場和宏觀經濟狀況的影響時，相對於我們所處的市場。我的意思是，我認為這有點微不足道。我們喜歡我們的投資組合，我們喜歡牙科和動物保健業務，坦率地說，所有 3 項業務，如果你真的將動物保健分解為伴侶和生產，這些都是有彈性的市場。他們過去已經證明了這一點。我認為——現在就證明了這一點。這就是我們看待它的方式。

I mean compared to a lot of industries. Like I said, when we talk about moves, there are small moves. There are things that we're monitoring, but we don't expect a significant impact. I mean, in terms of the rest of the impacts of the economy, I mean, you mentioned interest rates. I think interest rates really affect equipment portfolio, as we mentioned, to some extent, but the real impact on it for interest rates on us is on our debt. We have a responsible debt structure where we have roughly 50% of our debt fixed, 50% variable, but the interest rate increases that we've been seeing have had an impact on the variable side. And I would estimate those at maybe $0.05 of EPS that we're dealing with, but that we're overcoming as we talk about reaffirming our guidance, we're really looking at other parts of the business to cover that.

我的意思是與很多行業相比。就像我說的，當我們談論動作時，有一些小動作。我們正在監控一些事情，但我們預計不會產生重大影響。我的意思是，就經濟的其他影響而言，我的意思是，你提到了利率。正如我們提到的，我認為利率在某種程度上確實會影響設備組合，但利率對我們的真正影響是對我們的債務。我們有一個負責任的債務結構，我們大約有 50% 的債務是固定的，50% 是可變的，但我們一直看到的利率上升對可變方面產生了影響。我估計我們正在處理的每股收益可能為 0.05 美元，但在我們談論重申我們的指導時，我們正在克服這一點，我們真的在考慮業務的其他部分來解決這個問題。

Your next question comes from the line of Jon Block from Stifel.

您的下一個問題來自 Stifel 的 Jon Block。

Maybe I'll just start on the Animal Health side of the business. The overall [AHI] weren't too far from our expectations. But production animal Don, as you mentioned, at low single digits. I know you got the 11% year ago comp, but why the DRAXXIN headwinds now? I believe that when off-patent, call it well over a year ago. And so if you're first feeling that now why, and if so, should we expect that to sort of last for the next 2 or 3 quarters until arguably you lap that?

也許我會從動物健康方面的業務開始。總體 [AHI] 與我們的預期相差不遠。但是生產動物唐，正如你提到的，低個位數。我知道你在一年前獲得了 11% 的補償，但為什麼現在 DRAXXIN 逆風？我相信，當專利到期時，一年多以前就可以稱它為好。因此，如果您現在首先感覺到，為什麼，如果是這樣，我們是否應該期望這種情況會持續接下來的 2 或 3 個季度，直到可以說您超越它？

John, it's Kevin. I can jump in and then Don can add. The DRAXXIN issue, you're right, it came off patent last year. I think, the impact sort of builds over time, right? I think as those products come off patent, it's not a quick switch. And I think our production animal team who -- a team that executes very well out in the market has done a good job of managing that transition over the past 9 months here.

約翰，是凱文。我可以加入，然後 Don 可以添加。 DRAXXIN 問題，你是對的，它去年獲得了專利。我認為，這種影響會隨著時間的推移而建立，對嗎？我認為隨著這些產品的專利到期，這不是一個快速的轉變。而且我認為我們的生產動物團隊 - 一個在市場上執行得很好的團隊在過去 9 個月裡在管理過渡方面做得很好。

And so the impacts sort of accumulated for us over the fiscal year. And I think this is the first quarter where we really saw a real sizable impact on that category from the generics coming in. So I think we will see this dynamic in the next couple of quarters as we comp over the prior periods. But it's obviously built into our guidance, and that team is executing really well to keep our customers operating well and helping them understand what's going to be best for their practice for their operations.

因此，這些影響在整個財政年度對我們來說是累積的。我認為這是第一個季度，我們真正看到仿製藥的進入對該類別產生了真正可觀的影響。所以我認為我們將在接下來的幾個季度看到這種動態，因為我們會比較前幾個時期。但這顯然已納入我們的指導方針，並且該團隊執行得非常好，以保持我們的客戶良好運營，並幫助他們了解什麼最適合他們的運營實踐。

Got it. All right. I'll jump to my second question, and that was helpful. So on the dental consumables ex infection prevention, roughly the past 5 quarters, the growth has been plus 3 plus 3 plus 3 plus 2 and now plus 1. And arguably, the price contributions probably improved along the way. So maybe a couple of questions here. When you see the low single-digit long-term for dental consumables.

知道了。好的。我將跳到我的第二個問題，這很有幫助。因此，在預防感染前的牙科耗材方面，大約在過去 5 個季度，增長了 3 加 3 加 3 加 2，現在加 1。而且可以說，價格貢獻可能會一路提高。所以這裡可能有幾個問題。當您看到牙科耗材的長期低個位數時。

Is that inclusive of infection prevention or exclusive? And then also, is that long term a fiscal '24 time frame and if so, how do you get there considering price may play less of a role next year relative to fiscal '23?

是包含預防感染還是排除感染？然後，這個長期是 24 財年的時間框架嗎？如果是這樣，考慮到明年價格相對於 23 財年的影響可能較小，你如何到達那裡？

Yes. We would consider it, over the long term, inclusive of the PPE dynamic. As we mentioned, that's going to moderate as we move forward. And when you talk about the long term, I'd say that that's how you'd look at that. Sorry, Jon, what was the second part of that question?

是的。從長遠來看，我們會考慮將 PPE 動態包括在內。正如我們所提到的，隨著我們的前進，這種情況將會緩和。當你談論長期時，我會說這就是你看待它的方式。抱歉，喬恩，這個問題的第二部分是什麼？

Well, just maybe even just speak to sort of like the reacceleration, right? If you've had the decel and I'm sort of going because there's 2 different dynamics, right? One is, as you mentioned, the deflationary environment on gloves and that should normalize per your comments on vials. But Don, if we look at the decel, and it's been subtle, to be clear, but the plus 3 to plus 1 x infection prevention with price playing a bigger role, and you guys want to get back to low single digits, implying a little bit of an acceleration. How do you get there arguably if price may play less of a role next year versus this year?

好吧，甚至可能只是說有點像再加速，對吧？如果你有減速而我有點要去，因為有 2 種不同的動力，對吧？一個是，正如你提到的，手套上的通貨緊縮環境，根據你對小瓶的評論，這應該正常化。但是唐，如果我們看一下減速，它很微妙，很明顯，但是 plus 3 到 plus 1 x 感染預防價格發揮更大的作用，你們想要回到低個位數，這意味著一點點加速。如果明年價格的作用可能比今年小，那麼你如何實現這一目標呢？

Yes. Well, I think we're going to continue to execute on our strategy. I think when we break down the consumables, one thing I would say is that in the categories we compete in, we believe we're maintaining or taking share. We think we do pretty well in those categories. Sometimes it's hard to stack up everything just given the way that we're in certain categories, competitors are in certain categories, what does the market exactly look like. But I think we're well positioned to get back to taking share, which would probably put our companion sales, ex PP in the short term, but overall, in the long term, above the market growth.

是的。好吧，我認為我們將繼續執行我們的戰略。我認為當我們分解消耗品時，我要說的一件事是，在我們競爭的類別中，我們相信我們正在保持或分享。我們認為我們在這些類別中做得很好。有時很難把所有東西都放在一起，因為我們屬於某些類別，競爭對手屬於某些類別，市場到底是什麼樣子。但我認為我們已經準備好重新獲得份額，這可能會使我們的配套銷售（不包括 PP）在短期內，但總體而言，從長期來看，高於市場增長。

Your next question comes from the line of [Charlotte Coll] from Bank of America.

你的下一個問題來自美國銀行的 [Charlotte Coll]。

This is [charlotte] on for Mike. Could you just provide some more color on the trends that you're seeing in your customers, particularly as it relates to utilization in volumes? And then just an update around spend per visit as well.

這是邁克的[夏洛特]。您能否就您在客戶中看到的趨勢提供更多顏色，特別是與數量利用率相關的趨勢？然後只是關於每次訪問支出的更新。

Yes. I think the industry data would talk about in the companion business, vet visits being down roughly 2%, but that spend per visit is up 5%. So we think that's a growing market with that dynamic. So that's really the breakdown that I think -- and we would be -- we would look at our data and say that we think that seems reasonable and that that's consistent with what we're seeing as well.

是的。我認為行業數據會在同伴業務中討論，獸醫訪問下降了大約 2%，但每次訪問的支出增加了 5%。因此，我們認為這是一個具有這種活力的不斷增長的市場。所以這真的是我認為的細分 - 我們會 - 我們會查看我們的數據並說我們認為這似乎是合理的並且這與我們所看到的一致。

And especially within the context of the comparisons we have a year ago where you had a very high growth rate on visits in particular. So we've expected this sort of moderation in our results and our forecast.

特別是在我們一年前進行的比較的背景下，您的訪問量增長率特別高。因此，我們預計我們的結果和預測會出現這種緩和。

Got it. And then could you just discuss more on your strategy, particularly around organic investments that you're making in the core business?

知道了。然後你能否就你的戰略進行更多討論，特別是圍繞你在核心業務中進行的有機投資？

Well, we have a lot of different things we're investing in, in our core business. I think we've talked about them before. I mean, obviously, we strive for continued and improvement in our efficiency, just in our distribution operation itself. Our private label program is a very important part of our margin enhancement initiatives. And then just investing in the infrastructure we need to really drive the margin improvement. Margin improvement is paramount, and I think you can see it in these results. And if you look back, we're starting to -- in my view, we have a track record here of doing what we said we were going to do, which is improve the margins. And a lot of that has to do with all the various investments we're making to help drive that.

好吧，我們在核心業務中投資了很多不同的東西。我想我們之前已經談過它們了。我的意思是，很明顯，我們努力在我們的分銷業務本身中繼續提高我們的效率。我們的自有品牌計劃是我們提高利潤計劃的一個非常重要的部分。然後只需投資我們真正推動利潤率提高所需的基礎設施。提高利潤率是最重要的，我認為您可以在這些結果中看到這一點。如果你回頭看，我們開始 - 在我看來，我們在這裡有做我們說過要做的事情的記錄，這就是提高利潤率。這在很大程度上與我們為推動這一目標所做的各種投資有關。

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

你的下一個問題來自 William Blair 的 Brandon Vazquez。

I just wanted to focus a little bit on the macro comments that were being made earlier. And maybe you can talk a little bit, there's been some noise just around potentially like a deterioration of the consumer as we go into the final month here of the year. So kind of curious, maybe if you think about like on a month-to-month basis and even a month what you've seen since the close of the second quarter. It sounded like things have been stable. Have you been -- I just wanted to confirm that that's been the case, especially as we go beyond the second quarter and you haven't really seen maybe a worsening macro environment compared to the beginning of the quarter?

我只想稍微關註一下之前發表的宏觀評論。也許你可以談談，當我們進入今年的最後一個月時，周圍有一些噪音可能就像消費者的惡化一樣。有點好奇，也許如果你考慮一下自第二季度末以來你所看到的每個月甚至一個月的情況。聽起來事情一直很穩定。你有沒有 - 我只是想確認情況確實如此，特別是當我們超過第二季度並且你沒有真正看到與本季度初相比可能惡化的宏觀環境時？

Well, we wouldn't be -- we wouldn't really comment too much on intra-quarter trends or month-to-month trends. I mean I think I would say that just at a macro level, we kind of view our markets, as I mentioned, as particularly in the dental side as stable. The companion side, like I said, we're seeing vet visits down, but spend per visit up. And we're dealing with the Draxxin impact on production, but that's a resilient, stable market where we have the benefit of having a diversified portfolio that has really served us well over time.

好吧，我們不會——我們不會對季度內趨勢或月度趨勢發表太多評論。我的意思是，我想我會說，就宏觀層面而言，正如我提到的，我們認為我們的市場特別是在牙科方面是穩定的。同伴方面，就像我說的那樣，我們看到獸醫訪問減少了，但每次訪問的花費增加了。我們正在處理 Draxxin 對生產的影響，但這是一個有彈性、穩定的市場，我們受益於擁有多元化的投資組合，隨著時間的推移，這些投資組合確實為我們提供了很好的服務。

Okay. And then similarly on the macro headwinds, but maybe a different angle kind of looking geographically, are you guys seeing any notable differences in kind of end market strength? I know there seems to be a lot of concerns, especially around like Europe, that maybe higher energy prices there might lead to a more difficult kind of end market for a lot of names. So anything like that you guys would call out or factoring into guidance that we should be keeping in mind?

好的。然後類似地在宏觀逆風上，但也許從地理上看是不同的角度，你們是否看到終端市場實力有任何顯著差異？我知道似乎有很多擔憂，尤其是像歐洲這樣的地區，那裡的能源價格上漲可能會給很多公司帶來更困難的終端市場。那麼你們會提出或考慮我們應該牢記的指導嗎？

This is Kevin. Yes. Our international footprint is relatively small compared to North American footprint. We have a really nice business in the U.K. that performed well this quarter. Obviously, there's an FX headwind on the sales line, but constant currency basis is showing good growth. And so we feel like our position there is pretty strong. We're obviously watching it closely for those dynamics you said. But within our portfolio, North America is the majority of our business. And like Don said, we feel good about the stability of the markets here and how we're executing in them.

這是凱文。是的。與北美足跡相比，我們的國際足跡相對較小。我們在英國的業務非常好，本季度表現良好。顯然，銷售線上存在外匯逆風，但固定貨幣基礎顯示出良好的增長。所以我們覺得我們在那裡的地位非常強大。我們顯然正在密切關注你所說的那些動態。但在我們的投資組合中，北美是我們的大部分業務。正如唐所說，我們對這里市場的穩定性以及我們在其中的執行方式感到滿意。

I think we have time for one more question.

我想我們還有時間再問一個問題。

Certainly, your last question comes from the line of Elizabeth Anderson from Evercore ISI.

當然，您的最後一個問題來自 Evercore ISI 的 Elizabeth Anderson。

This is Pat on for Elizabeth. So to think we've been trying to sort through on the deal equipment side is that we're hearing about weakness in the category from some of the factors right now. But both you and some of your peers are characterizing strength in the segment. Can you just help us sort through that? Are there any channel dynamics you might be neglecting to consider? Or what is driving that disconnect between dental equipment commentary between the distributors and the manufacturers?

這是伊麗莎白的帕特。因此，認為我們一直在努力解決交易設備方面的問題是，我們現在從某些因素中聽到了該類別的弱點。但是您和您的一些同行都在展示該細分市場的優勢。你能幫我們解決這個問題嗎？是否有任何您可能忽略考慮的渠道動態？或者是什麼導致了經銷商和製造商之間牙科設備評論之間的脫節？

Yes. I think honestly, what we're seeing is just what we said, which is we had a strong equipment quarter. There's continued solid, good demand. The pipeline continues to be replenished and it's -- I think it's always been a little hard to sort out and reconcile the timing of things that happen at the manufacturers versus the distributors just given when shipments take place, how the supply chain works, what we're seeing and it's hard to really argue given our results, is that equipment is strong, the demand is strong and that's our -- that's kind of our world and what we're seeing.

是的。老實說，我們所看到的正是我們所說的，即我們有一個強勁的設備季度。需求持續穩定、良好。管道繼續得到補充，而且——我認為，要理清和協調製造商和分銷商發生的事情的時間總是有點困難，因為發貨時間、供應鏈如何運作、我們做什麼看到並且很難根據我們的結果真正爭論，是設備強大，需求強勁，這就是我們的 - 這就是我們的世界和我們所看到的。

Thank you for your time today and your interest in Patterson Companies. We wish you and your families a wonderful holiday season. Happy new year, and we'll talk to you next quarter. Thanks.

感謝您今天抽出寶貴時間以及對 Patterson Companies 的關注。我們祝您和您的家人度過一個美好的假期。新年快樂，我們將在下個季度與您交談。謝謝。

This concludes today's conference call. Thank you for your participation. 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。