Q1 2024 Teleflex Inc Earnings Call

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Operator: Good morning, ladies and gentlemen, and welcome to the Teleflex First Quarter 2024 Earnings Conference Call. At this time, all participants have been placed in a listen-only mode. At the end of the company's prepared remarks, we will conduct a question and answer session. Please note that this conference call is being recorded and will be available on the company's website for replay shortly. And now, I will turn the call over to Mr. Lawrence Keusch, Vice President of Investor Relations and Strategy Development.

Speaker Change: Good morning, ladies and gentlemen, and welcome to the Teleflex first quarter 'twenty to 'twenty four earnings conference call.

Speaker Change: At this time, all participants have been placed in a listen only mode. At the end of the company's prepared remarks, we will conduct a question and answer session.

Please note that this conference call is being recorded and will be available on the company's website for replay shortly.

Speaker Change: And now I will turn the call over to Mr. Lawrence cash Vice President of Investor Relations and strategy development.

Lawrence Keusch: Good morning, everyone, and welcome to the Teleflex Incorporated first quarter 2024 earnings conference call. Press release and slides to accompany this call are available on our website at teleflex.com. As a reminder, a replay will be available on our website. Those wishing to access the replay can refer to our press release this morning.

Lawrence Keusch: Good morning, everyone and welcome to the Teleflex incorporated first quarter 2024 earnings Conference call.

Speaker Change: Press release and slides to accompany this call are available on our website at Teleflex Dot com.

Lawrence Keusch: As a reminder, a replay will be available on our website those wishing to access the replay can refer to our press release from this morning for details.

Lawrence Keusch: Participating on today's call are Liam Kelly, Chairman, President, and Chief Executive Officer, and Thomas Powell, Executive Vice President and Chief Financial Officer. Liam and Tom will provide prepared remarks, and then we will open the call to Q&A. Before we begin, I'd like to remind you that some of the matters discussed in the conference call will contain forward-looking statements regarding future events, as outlined in the slides posted to the Investor Relations section of the Teleflex website.

Lawrence Keusch: Participating on today's call are Liam Kelly, Chairman, President and Chief Executive Officer, and Thomas Powell, Executive Vice President and Chief Financial Officer.

Liam J. Kelly: Liam and Tom will provide prepared remarks, and then we will open the call up to Q&A.

Lawrence Keusch: We wish to caution you that such statements are, in fact, forward-looking in nature and are subject to risks and uncertainties, and actual events or results may differ materially. The factors that could cause actual results or events to differ materially include, but are not limited to, factors referenced in our press release today, as well as our filings with the SEC, including our Form 10-K, which can be accessed on our website. Now, I'll turn the call over to Liam for his remarks.

Liam J. Kelly: Before we begin I would like to remind you that some of the matters discussed in the conference call will contain forward looking statements regarding future events as outlined in the slides posted to the Investor Relations section of the Teleflex website.

Liam J. Kelly: We wish to caution you that such statements are forward looking in nature and are subject to risks and uncertainties and actual events or results may differ materially.

Liam J. Kelly: The factors that could cause actual results or events to differ materially include but are not limited to factors referenced in our press release today.

Liam J. Kelly: As well as our filings with the SEC, including our Form 10-K, which can be accessed on our website.

Liam J. Kelly: Now I'll turn the call over to Liam for his remarks.

Liam J. Kelly: Thank you, Larry, and good morning, everyone. On this morning's call, we will discuss the first quarter results, review some commercial highlights, and provide an update on our financial guidance for 2020. We had a solid start to 2024 as momentum seen through last year continued into the first quarter. For the quarter, Teleflex revenues were $737.8 million, up 3.8% year-over-year on both a GAAP and constant currency basis. First quarter adjusted earnings per share was $3.21, a 3.9% increase year over year.

Liam J. Kelly: Thank you Larry and good morning, everyone on this morning's call. We will discuss the first quarter results review some commercial highlights and provide an update on our financial guidance for 2024.

Liam J. Kelly: A solid start to 2024 as momentum seen through last year continued into the first quarter.

Liam J. Kelly: For the quarter Teleflex revenues were 737 8 million up three 8% year over year on both a GAAP and constant currency basis.

Liam J. Kelly: First quarter adjusted earnings per share was $3 21.

Liam J. Kelly: Three 9% increase year over year.

Liam J. Kelly: During the quarter utilization for our products trended positively and tracked to our expectations.

Liam J. Kelly: During the quarter, utilization for our products trended positively and tracked to our expectations. While we do not expect a revenue benefit from pent-up demand due to the broad exposure of the Teleflex portfolio to critical care procedures, we are seeing utilization back to pre-pandemic levels. Turning to raw material inflation,

Liam J. Kelly: While we do not expect a revenue benefit from pent up demand due to the broad exposure of the teleflex portfolio to critical care procedures, we are seeing utilization back to pre pandemic levels.

Liam J. Kelly: Turning to raw material inflation.

Liam J. Kelly: We saw positive trends during the first quarter, with year-over-year disinflation tracking towards our expectations for the year. Nonetheless, we continue to expect total inflation to be somewhat higher in 2024 as compared to 2023, in part due to inventory capitalized in 2023, impacting the income statement this year. I would also like to provide an update on our logistics and distribution infrastructure. Our freight expenses continue to show positive trends. Despite the conflict in the Middle East, we continue to maintain customer service levels by successfully diverting shipments to alternative shipping lanes. In addition, I would note that we do not utilize the Port of Baltimore to ship Teleflex products to, or from, our North American distribution centers.

Liam J. Kelly: We saw positive trends during the first quarter with year over year disinflation tracking towards our expectations for the year.

Liam J. Kelly: Nonetheless, we continue to expect total inflation to be somewhat higher in 2024 as compared to 2023 inherent due to inventory capitalized in 2023 impacting the income statement this year.

Liam J. Kelly: I would also like to provide an update on our logistics and distribution infrastructure.

Liam J. Kelly: Our freight expenses continued to show positive trends.

Liam J. Kelly: Despite the conflict in the Middle East, we continued to maintain customer service levels by successfully diverting shipments to alternative shipping lanes.

Liam J. Kelly: In addition, I would note that we do not utilize the floor to Baltimore to ship Teleflex products to our from our North American distribution Center.

Liam J. Kelly: Now, let's turn to a deeper dive into our first quarter revenue results. I will begin with a review of our geographic segment revenues for the first quarter. All growth rates that are referred to are on a constant currency basis unless otherwise noted.

Liam J. Kelly: Now, let's turn to a deeper dive into our first quarter revenue results.

Liam J. Kelly: America's revenues were $406.3 million, a 1.5% decrease year over year. However, investors familiar with Teleflex will be aware that prior year MSA revenues were booked in the Americas. EMEA revenues of $159.6 million increased 9.7% year over year. Growth was seen across the majority of our product families, including solid double-digit growth contributions from interventional and interventional urology. The region also benefited from the ongoing recovery of ET tubes following the recall last year. Now, turning to Asia.

Speaker Change: I will begin with a review of our geographic segment revenues for the first quarter.

Speaker Change: All growth rates that I referred to are on a constant currency basis, unless otherwise noted.

Speaker Change: America's revenues were $406 3 million.

Speaker Change: A one 5% decrease year over year.

Speaker Change: Investors familiar with teleflex, whether it be aware that prior year MSA revenues were booked in the Americas.

Speaker Change: EMEA revenues of $159 $6 million increased nine 7% year over year.

Speaker Change: Growth was seen across the majority of our product families, including solid double digit growth contributions from intervention and intervention urology.

Speaker Change: The region also benefited from the ongoing recovery of ETE tubes, following the recall last year.

Speaker Change: Now turning to Asia.

Liam J. Kelly: Revenues were $84.2 million, an 11.2% increase year over year. Revenue growth was broad-based across the region, with double-digit increases in China, India, and Southeast Asia. Let's now move to a discussion on our first quarter revenues by global product category. Commentary on global product category growth for the first quarter will also be on a year-over-year constant currency basis, starting with vascular acti- Revenue increased 2% year over year to $181.4 million. The quarter was led by underlying growth in PICS, Central Access, and EDIO, partly offset by the impact of the previously announced endurance catheter recall. We will anniversary the endurance recall during the second quarter, and we continue to see opportunities for share gains in the peripheral access market. Moving on to intervention.

Speaker Change: Revenues were $84 2 million and 11, 2% increase year over year rare.

Speaker Change: Revenue growth was broad based across the region with double digit increases in China, India and Southeast Asia.

Speaker Change: Let's now move to a discussion on our first quarter revenues by global product category.

Speaker Change: Commentary on global product category growth for the first quarter will also be on a year over year constant currency basis.

Speaker Change: Starting with vascular access.

Speaker Change: Revenue increased 2% year over year to $181 4 million.

Speaker Change: The quarter was led by underlying growth in pigs, central access and EZ Io, partly offset by the impact of the previously announced in <unk> catheter recall.

Speaker Change: We will anniversary the endurance recall during the second quarter, and we continue to see opportunities for share gains in the peripheral access market.

Speaker Change: Moving to interventional.

Liam J. Kelly: Revenue was $134.7 million, an increase of 15.4% year over year. We demonstrated growth across our geographic segments as our portfolio of growth drivers continues to perform well. During the quarter, growth was led by balloon pumps, Manta, and Complex Capital. Turning to anesthesia,

Speaker Change: Revenue was $134 $7 million, an increase of 15, 4% year over year.

Speaker Change: We demonstrated growth across our geographic segments as our portfolio of growth drivers continues to perform well.

Speaker Change: During the quarter growth was led by balloon pumps Mantech in complex catheters.

Speaker Change: Turning to anesthesia.

Liam J. Kelly: Revenue increased 3.2% year-over-year to $96.4 million. Growth was balanced across the portfolio. Of note, we continue to recover from the ET tube recall initiated during the second quarter of 2023 and will fully anniversary the revenue comparisons at the end of next quarter. In our surgical business, revenue was $105.5 million, an increase of 7.1% year-over-year against a tough comparison.

Speaker Change: Revenue increased three 2% year over year to $96 4 million.

Speaker Change: Growth was balanced across the portfolio.

Speaker Change: Of note, we continue to recover from the ETE tube recall initiated during the second quarter of 2023 and will fully anniversary the revenue comparisons at the end of next quarter.

In our surgical business revenue was $105 5 million.

Speaker Change: An increase of seven 1% year over year against a tough comparison.

Liam J. Kelly: Our underlying trends in our core surgical franchise continue to be solid. Among our largest franchises, growth was led by chest drainage, instrumentation, and our ligation portfolio. For interventional urology, revenue was $79.7 million, representing an increase of 6.1% year over year. Growth was driven by barrel gel revenue following the October 2023 acquisition of Pellet Life Sciences.

Speaker Change: Our underlying trends in our core surgical franchise continued to be solid.

Speaker Change: Among our largest franchises growth was led by test range instrumentation, and our legation portfolio.

Speaker Change: For interventional urology revenue was $79 $7 million.

Speaker Change: Representing an increase of six 1% year over year.

Speaker Change: Both was driven by barrier gel revenue following the October 2023 acquisition of <unk>.

Speaker Change: Life Sciences.

Liam J. Kelly: And, as anticipated, your lip growth was impacted by continued challenges in the office side of service and Salesforce training activities for Barragel during the quarter. Our full year 2024 Interventional Urology Total Revenue Guidance continues to assume approximately 7.5% growth, which continues to incorporate Palette revenues in the range of $66 to $68 million for 2024. OEM had another solid quarter, with revenues increasing 13.6% year-over-year to $87.7 million. Our three largest product categories recorded double-digit growth in the quarter, including continued strength in microcategories. In addition, we saw some modest benefit from order timing shifting from the second quarter into the first quarter. However, first quarter other revenue declined 27.1% to $52.4 million year over year.

Speaker Change: And as anticipated.

Speaker Change: Lift growth was impacted by continued challenges in the office site of service and sales force training activities for barrier gel during the quarter.

Speaker Change: Our full year 2020 for interventional urology total revenue guidance continues to assume approximately seven 5% growth.

Speaker Change: Which continues to incorporate collect revenues in the range of $66 million to $68 million or 2024.

Speaker Change: OEM had another solid quarter with revenues, increasing 13, 6% year over year to $87 $7 million.

Speaker Change: Our three largest product categories recorded double digit growth in the quarter, including continued strength in micro catheters.

Speaker Change: In addition, we saw some modest benefit from order timing shifting from the second quarter into the first quarter.

First quarter other revenue declined 27, 1% to $52 $4 million year over year.

Liam J. Kelly: The decline in revenue on a year over year basis is primarily due to the planned December 2023 exit of the MSA by MEDLINE. That completes my comments on the First Board of Revenue performance. Turning to some commercial and clinical updates, starting with an update on Palette Life Sciences, our most recent acquisition. We have now owned Palette for just over six months, and I am pleased to report that the integration process is meeting our targeted milestone.

Speaker Change: The decline in revenue on a year over year basis is primarily due to the planned December 2023 exit of the MSA by Metlife.

Speaker Change: That completes my comments on the first quarter revenue performance.

Speaker Change: Turning to some commercial and clinical updates.

Speaker Change: Starting with an update on <unk> life Sciences, our most recent acquisition.

Speaker Change: We have now owned palette life Sciences for just over six months and I am pleased to report that the integration process is meeting our targeted milestones.

Liam J. Kelly: Cross-functional product sales training continued to progress throughout the first quarter, and the first phase of training for our jewel bag reps will be completed at the end of the second quarter. During the quarter, we were active training and proctoring the legacy Eurolift sales force on the use of Barragell, and we remain on track to fully complete the integration of the sales force by the end of 2024. Moving on to a couple of product updates.

Speaker Change: Cross functional product sales training continued to progress throughout the first quarter.

Speaker Change: And the first phase of training for our dual bagged reps will be completed at the end of the second quarter.

Speaker Change: During the quarter, we were active training and <unk> the legacy Euro less sales force on the use of borrowed Joe and we remain on track to fully complete the integration of the sales force by the end of 2024.

Speaker Change: Moving to a couple of product updates.

Liam J. Kelly: In our interventional access business, we initiated a limited market release of the Watson Temporary Paging Guidework. Watson will complement our expanding structural heart portfolio, which already includes the Manta large foreclosure device and the Langston dual lumen for contrast delivery and pressure measurement. In our surgical business, we are pleased to share that the Titan SGS stapler is now available with Gore seam guard by absorbable staple line reinforcement material.

Speaker Change: And our intervention of access business, we initiated a limited market release of the Watson temporary pacing guidewire.

Speaker Change: Watson with complement our expanding structural heart portfolio.

Speaker Change: Which already includes the manta large bore closure device and the Langston dual lumen are contrast delivery and pressure measurement.

Speaker Change: In our surgical business, we are pleased to share that the tightened SGS stapler is now available with Gore seem guard <unk> staple line reinforcement materials.

Liam J. Kelly: This complementary pairing supports bariatric surgeons by addressing clinical preferences in the sleeve gastrectomy market. As we look further into 2024, we will continue to advance our new product introductions with a number of launches across our business units. In our interventional access business, there is no change to our expectation for FDA marketing clearance and a limited market release of the Ringer catheter in the second half of 2024. Ringer incorporates a unique balloon design that allows blood to flow through a vessel while the balloon is inflated.

Speaker Change: This complementary pairing supports bariatric surgeons by addressing clinical preferences in the sleeve gastrectomy markets.

Speaker Change: As we look further into 2024, we will continue to advance our new product introductions with a number of launches across our business units.

Speaker Change: And our interventional access business there is no change to our expectation for an FDA marketing clearance and a limited market release of the Ringer catheter in the second half of 2024.

Speaker Change: Ringer incorporates a unique balloon design that allows blood to flow through the vessel part of the balloon is in places.

Liam J. Kelly: We expect to initially launch with a PTCA indication but will evaluate opportunities for label expansion following the completion of our vessel preparation trial. Finally, I will provide a regulatory update. In February, we voluntarily initiated a recall of our QuickFlash radial artery and radial artery arterial line catheterization kits after receiving reports of increased resistance in the guide wire handle and chamber during use. The financial impact of this recall was de minimis. In cooperation with the FDA, Teleflex also recently initiated a voluntary field advisory notice for Arrow FiberOptics and Ultraflex intraortic balloon catheter kits.

Speaker Change: We expect to initially launch with a ptca indication, but we'll evaluate opportunities for label expansion. Following the completion of our vessel perforation trials.

Speaker Change: Finally, I will provide a regulatory update.

Speaker Change: In February we voluntarily initiated a recall of our quick flash radial artery and radial artery arterial line categorization kits. After receiving reports of increased resistance in the guidewire handle and chamber during use.

Speaker Change: The financial impact from this recall was de Minimis.

Speaker Change: In cooperation with the FDA Teleflex also recently initiated a voluntary field advisory notice for arrow fiber optics, and ultra flex intra aortic balloon catheter kids.

Liam J. Kelly: Due to reports indicating, and Infrequent Condition, which when not identified and corrected promptly could result in serious health consequences, including a reduction or loss of the hemodynamic support normally provided by intraortic balloon pump therapy. The FDA has not yet designated a recall classification, but under the field advisory notice, customers may continue to use the products in scope per additional instructions, warnings, and cautions. We expect the financial impact of the voluntary field action to be immaterial.

Speaker Change: Due to reports, indicating.

Speaker Change: And infrequent condition, which were not identified and corrected promptly could result in serious health consequences, including a reduction or loss of the hemodynamic support normally provided by intra aortic balloon pump therapy.

Speaker Change: The FDA has not yet designated a recall classification, but under the field advisory notice customers may continue to use the products in scope for additional instructions warnings and cautions.

Speaker Change: We expect the financial impact from the voluntary field action to be immaterial.

Liam J. Kelly: That completes my prepared remarks; now I'd like to turn the call over to Tom for a more detailed review of our first quarter financial results.

Speaker Change: That completes my prepared remarks, now I would like to turn the call over to Tom for a more detailed review of our first quarter financial results Tom.

Thomas E. Powell: Thanks, Liam, and good morning. Given the previous discussion of the company's revenue performance, I'll begin with margins. For the quarter, adjusted gross margin was 61.1%, a 170 basis point increase versus the prior year period. The year-over-year increase was primarily due to the favorable impact of gross margin from the termination of the MSA, the acquisition of POLLET, favorable price, benefits from cost improvement initiatives, partially offset by unfavorable fluctuations in foreign exchange rates and continued cost inflation.

Tom: Thanks, Liam and good morning.

Tom: Given the previous discussion of the company's revenue performance I'll begin with margins for.

Tom: For the quarter adjusted gross margin was 61, 1%, a 170 basis point increase versus the prior year period.

Tom: The year over year increase was primarily due to the favorable impact of gross margin from the termination of the MSA the acquisition of <unk>.

Tom: Oil price benefits from cost improvement initiatives.

Tom: Partially offset by unfavorable fluctuations in foreign exchange rates and continued cost inflation.

Thomas E. Powell: Adjusted operating margin was 26.6% in the first quarter. The 80 basis point year-over-year increase was primarily driven by the flow-through of the year-over-year increase in gross margin partially offset by the inclusion of collect life science, operating expenses, employee-related expenses, and investments to grow the business. Net interest expense totaled $21 million in the first quarter, an increase from $17.5 million in the prior year period.

Tom: Adjusted operating margin was 26, 6% in the first quarter.

Tom: The 80 basis point year over year increase was primarily driven by the flow through of the year over year increase in gross margin, partially offset by the inclusion of Collette life science operating expenses employee related expenses and investments to grow the business.

Tom: Net interest expense totaled $21 million in the first quarter, an increase from $17 5 million in the prior year period.

Thomas E. Powell: The year-over-year increase in net interest expense reflects higher interest rates versus the prior year and higher average debt outstanding utilized to fund the acquisition of Pellet, partially offset by increased interest income. Our adjusted tax rate for the first quarter of 2024 was 13.2% compared to 11.8% in the prior year period. The year-over-year increase in our adjusted tax rate is primarily due to additional costs arising from the enactment of European Pillar 2 tax reform and realization of discrete items in the quarter.

Tom: The year over year increase in net interest expense reflects higher interest rates versus the prior year and higher average debt outstanding utilized to fund the acquisition of <unk>.

Tom: Partially offset by increased interest income.

Tom: Our adjusted tax rate for the first quarter of 2024 was 13, 2%.

Tom: Compared to 11, 8% in the prior year period.

Tom: The year over year increase in our adjusted tax rate is primarily due to additional costs arising from the enactment of European pillar to tax reform and realization of discrete items in the quarter.

Thomas E. Powell: At the bottom line, first quarter adjusted earnings per share was $3.21, an increase of 3.9% versus the prior year. The year-over-year increase in EPS reflects dilution from the acquisition of Palette Life Sciences and the related incremental borrowing. Turning now to Select Balance Sheet and Cash Flow Highline, cash flow from operations for the first quarter was $112.8 million compared to $84.3 million in the prior year period.

Tom: At the bottom line first quarter adjusted earnings per share was $3 in 'twenty one.

Tom: An increase of three 9% versus prior year.

Tom: The year over year increase in EPS reflects dilution from the acquisition of palette life Sciences, and the related incremental borrowings.

Tom: Turning now to select balance sheet and cash flow highlights.

Tom: Cash flow from operations for the first quarter was $112 8 million compared to $84 3 million in the prior year period.

Tom: The $28 $5 million increase was primarily attributable to favorable operating results in a decrease in cash outflows from inventories as we moderate our inventory levels due to improving supply chain dynamics.

Tom: Partially offset by an increase in accounts receivable, resulting from higher sales and lower levels of accounts payable and accrued expenses.

Thomas E. Powell: The $28.5 million increase was primarily attributable to favorable operating results and a decrease in cash outflows from inventories as we moderate our inventory levels due to improving supply chain dynamics, partially offset by an increase in accounts receivable resulting from higher sales and lower levels of accounts payable in accrued expenses. Moving to the balance sheet. At the end of the first quarter, our cash balance was $237.4 million, as compared to $222.8 million as of year-end 2023. The increase in cash on hand is primarily due to operating cash flow. Net leverage at quarter end was approximately 1.7 times.

Tom: Moving to the balance sheet.

Tom: At the end of the first quarter, our cash balance was $237 4 million as compared to $222 8 million as of year end 2023.

Tom: The increase in cash on hand is primarily due to operating cash flows.

Tom: Net leverage at quarter end was approximately one seven times.

Tom: Inclusive of the debt associated with the acquisition of <unk> Life Sciences, our financial position remains sound and continues to provide us flexibility to execute on our long term capital allocation strategy.

Thomas E. Powell: Inclusive of the debt associated with the acquisition of Pellet Life Sciences, our financial position remains sound and continues to provide us with flexibility to execute on our long-term capital allocation strategy. Turning to financial guidance, we are pleased with a solid start to the year and are making select updates to The Outlook for 2024. We continue to expect 2024 constant currency revenue growth of 3.75% to 4.75%. The year-over-year growth includes the loss of $75.7 million in MSA revenues, partly offset by the incremental revenues from Pollack in the range of 66 to 68 million dollars, which Liam mentioned earlier. Turning to foreign exchange.

Turning to financial guidance.

Thomas E. Powell: We now assume a negative impact from foreign exchange of approximately $12 million, representing a 40 basis point headwind to GAAP Pro in 2024. This compares to our prior guidance of approximately $5 million, or a 15 basis point headwind for 2024. The updated guidance of a $12 million foreign exchange headwind assumes approximately a $1.07 average Euro exchange rate for 2024 versus the prior guidance, which assumed approximately $1.08. Considering the foreign exchange outlook, we expect reported revenue growth of 3.35% to 4.35% in 2024, implying a dollar range of $3.074 billion to $3.104 billion.

Tom: We are pleased with the solid start to the year and are making select updates to the outlook for 2024.

Tom: We continue to expect 2020 for constant currency revenue growth of 375% to 475%.

Tom: The year over year growth includes the loss of the $75 $7 million in MSA revenues.

Tom: Partly offset by the incremental revenues from <unk> in the range of <unk> $66 million to $68 million.

Tom: Which Leo mentioned earlier.

Tom: Turning to foreign exchange.

Tom: We now assume a negative impact from foreign exchange of approximately $12 million, representing a 40 basis point headwind to cap growth in 2024.

Tom: This compares to our prior guidance of approximately $5 million or 15 basis point headwind for 2024.

Tom: The updated guidance of a $12 million foreign exchange headwind assumes approximately a $1 seven average euro exchange rate for 2024 versus the prior guidance, which had assumed approximately $1 <unk>.

Tom: Considering the foreign exchange outlook, we expect reported revenue growth of 335% to 435% in 2024 and.

Tom: Implying a dollar range of $3 74 billion to $3 104 billion.

Thomas E. Powell: For your modeling purposes, the 2024 outlook includes an assumption of $760 to $765 million in revenues for the second quarter, representing growth in the range of 3.1% to 3.8% year-over-year, excluding an FX headwind of approximately $6 million. We reiterate our expectation for 2024 gross margin to be in the range of 60% to 60.75%. Our gross margin guidance reflects year-over-year positive impacts from the termination of the MSA, manufacturing efficiencies, price, and the Follett Acquisition, partially offset by inflation and the impact of changes in foreign currency exchange rates.

Tom: For your modeling purposes. The 2024 outlook includes an assumption or 760 $765 million and revenues for the second quarter.

Tom: Presenting growth in the range of three 1% to three 8% year over year.

Tom: Excluding an FX headwind of approximately $6 million.

Tom: We reiterate our expectation for 2020 for gross margin to be in the range of 60%.

Tom: <unk>, 75%.

Tom: Our gross margin guidance reflects the year over year positive impacts from the termination of the MSA.

Tom: Manufacturing efficiencies price and the <unk> acquisition.

Tom: Partially offset by inflation and the impact of changes in foreign currency exchange rates.

Thomas E. Powell: We also continue to expect operating margin to be in the range of 26.25% to 26.75% for 2024. Our guidance reflects the flow through of gross margin and the positive impact of restructuring offset by the inclusion of operating expenses for Palette Life Sciences and investments to grow the business. Moving to items below the line.

Tom: We also continue to expect operating margin to be in the range of 26, 5% to 26, 75% for 2024.

Tom: Our guidance reflects the flow through of gross margin and the positive impact of restructuring offset by the inclusion of operating expenses for life Sciences and investments to grow the business.

Tom: Moving to items below the line.

Thomas E. Powell: Net interest expense is expected to approximate $78 million for 2024. The majority of the year-over-year increase in our net interest expense outlook reflects the impact of borrowings associated with the Pellet Acquisition. Higher interest rates are partially offset by planned debt repayments during 2024. Our tax rate is expected to be approximately 12% for 2024, which reflects a favorable mix offset by discreet items in 2023 that will not repeat in 2024 and the impact of the Pillar 2 global minimum tax.

Tom: Net interest expense is expected to approximate $7 million to $8 million for 2020 for.

Tom: The majority of the year over year increase in our net interest expense outlook reflects the impact of borrowings associated with the <unk> acquisition.

Tom: Higher interest rates, partially offset by planned debt repayments during 2024.

Tom: Our tax rate is expected to be approximately 12% for 2024.

Tom: Which reflects favorable mix offset by discreet items in 2023 that will not repeat in 2024.

Tom: And the impact of the pillar two global minimum tax.

Thomas E. Powell: Turning to Earnings. We are raising the low end of guidance by five cents, which reflects the strong results in the first quarter and the updated foreign exchange headwind. In turn, we now expect 2024 adjusted earnings per share to be in a range of $13.60 to $13.95. Finally, our 2024 Adjusted EPS Outlook reflects $0.87 in year-over-year headwinds from incremental dilution associated with the acquisition of Pellet and the termination of the MSA. The year-over-year increase in our tax rate is primarily due to the Pillar 2 minimum tax and the updated foreign exchange headwind of $0.28. After adjusting for these headwinds, year-over-year underlying adjusted constant currency EPS growth is approximately 7% on the low end of guidance and 10% on the high end of guidance.

Tom: Turning to earnings.

Tom: We are raising the low end of guidance by <unk> <unk>, which reflects.

Tom: The strong results in the first quarter and the updated foreign exchange headwind.

Tom: In turn we now expect 2024 adjusted earnings per share to be in a range of $13 60.

Tom: The $13 95.

Tom: Finally, our 2024 adjusted EPS outlook reflects 87 and year over year headwinds from incremental dilution associated with the acquisition of <unk>.

Tom: The termination of the MSA.

Tom: The year over year increase in our tax rate, primarily due to the pillar two minimum tax.

Tom: And the updated foreign exchange headwind of 28.

Tom: After adjusting for these headwinds year over year underlying adjusted constant currency EPS growth is approximately 7% on the low end of guidance and 10% on the high end of guidance.

Tom: That concludes my prepared remarks, I would now like to turn it back to Liam for closing commentary.

Liam J. Kelly: That concludes my prepared remarks. I would now like to turn it back to Liam for closing comments.

Liam J. Kelly: Thanks, Tom.

Liam J. Kelly: In closing, I will highlight our three key takeaways from the first quarter of 2024. First, we started 2024 with a solid performance as momentum continued from the end of last year. Overall, our diversified portfolio and global business units performed well.

Liam J. Kelly: In closing I will highlight our three key takeaways from the first quarter of 2024.

First we started 2024 with a solid performance as momentum continued from the end of last year.

Liam J. Kelly: Overall, our diversified portfolio and global business units performed well, we managed operating expenses and continue to focus on new product introductions in 2024.

Liam J. Kelly: We managed operating expenses and continued to focus on new product introductions in 2024. Netting the loss of MSA revenues, the incremental Palette sales, and the revised foreign exchange headwind, we anticipate an approximately 100 basis points year-over-year headwind to growth in 2024. Second, we are well positioned to deliver on our financial guidance for 2024. We remain highly focused on executing on our plan for the year, just as we did in 2022. Third, we will continue to focus on our strategy to drive durable growth.

Liam J. Kelly: Netting the loss of MSA revenues, the incremental <unk> sales and the revised foreign exchange headwind, we anticipate an approximately 100 basis points year over year headwind to growth in 2024.

Liam J. Kelly: Second we are well positioned to deliver on our financial guidance for 2024, we remain highly focused on executing on our plan for the year just as we did in 2023.

Liam J. Kelly: Third we will continue to focus on our strategy to drive durable growth, we will invest in organic growth opportunities and drive innovation over time expand our margins and execute on our disciplined capital allocation strategy to enhance long term value creation.

Liam J. Kelly: We will invest in organic growth opportunities and drive innovation over time, expand our margins, and execute on our disciplined capital allocation strategy to enhance long-term value creation. The integration of Palette Life Sciences is progressing well, and we expect the acquisition to be a meaningful contributor to our growth in the coming year. That concludes my prepared remarks. Now, I would like to turn the call back to the operator for Q&A.

Liam J. Kelly: The integration of <unk> life Sciences is progressing well and we expect the acquisition to be a meaningful contributor to our growth in the coming years.

Speaker Change: That concludes my prepared remarks, now I would like to turn the call back to the operator for Q&A.

Operator: Thank you, and if you'd like to ask a question, please press star 1 on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment.

Speaker Change: Thank you and if you'd like to ask a question. Please press star one on your telephone keypad.

Speaker Change: If youre using a speakerphone. Please make sure your mute function is turned off to allow your signal to reach our equipment.

Operator: We ask that you limit yourself to one question and one follow-up. If you would like to ask additional questions, we invite you to add yourself to the queue again by pressing star 1. And your first question will come from the line of Patrick Wood from Morgan Stanley. Please go ahead.

Speaker Change: We ask that you limit yourself to one question and one follow up if you would like to ask additional questions. We invite you to add yourself to the queue again by pressing star one.

Speaker Change: And your first question will come from the line of Patrick Wood from Morgan Stanley. Please go ahead.

Patrick Andrew Robert Wood: Amazing. Thank you for taking the questions. I guess for the first one, I'm curious about OEM, another very strong quarter. There are kind of a lot of different pieces moving in there, but the volume environment is very good. But equally, there's a little bit of competitive noise back and forth. I'm curious how you see that evolving through the year. You've mentioned a little bit of phasing as some stuff was pulled into Q1, but should we expect more of a normalization in the second half or similar kinds of growth patterns that we've seen so far?

Patrick Andrew Robert Wood: Amazing Thank you for taking the questions I guess.

Patrick Andrew Robert Wood: So the first one I'm curious about OEM, another very strong quarter.

Kind of a lot of different pieces moving in that the volume environment is very good but equally there's a little bit of competitive noise backwards and forwards.

Patrick Andrew Robert Wood: I'm curious how you see that evolving through the year, you've mentioned a little bit of phasing of some stuff was pulled into Q1 that should we expect some more of a normalization in the second half or similar kinds of growth patents, what you've seen so far.

Liam J. Kelly: Hey Patrick, thank you very much for the question. I think that OEM was definitely one of the standouts again within the quarter, but there were many standouts for Teleflex in my mind. A really strong quarter, a great start to the year, growing our revenues at 3.8% and growing our earnings faster than revenues at 3.9% and raising the bottom end of our earnings guide while covering some FX impact.

Speaker Change: Hey, Patrick Thank you very much for the question I think Thats OEM was definitely one of the standouts again within the quarter, but there were many standouts for teleflex in the quarter in my mind.

Speaker Change: A really strong quarter, a great start to the year.

Speaker Change: Growing our revenues at three 8% and growing our earnings faster than revenues of three 9% and raising the bottom end of our of our earnings guidance, while covering some FX impact onto OEM.

Liam J. Kelly: On to OEM, you know. I do anticipate the phasing as we go through the year. I think OEM is well capable of doing double-digit growth throughout the entirety of the year. It'll probably take a little bit of a step back in Q2 just due to the phasing of the orders as you outlined, but the underlying growth is really strong. The order bank is strong, very strong on thin-walled microcatheters following on from the HPC acquisition a number of years ago.

Speaker Change: I do anticipate the phasing as we go through the year.

Speaker Change: I think the OEM is well capable of doing double digit growth in the entirety of the year. It will probably take a little bit of a step back in Q2, just as a phasing as the orders as you outlined but the underlying growth is really strong the order bank is strong.

Speaker Change: Very strong on 10 malls micro catheters following on from the HBC acquisition, a number of years ago catheter extrusion is continues to be strong demand is robust.

Liam J. Kelly: Catheter extrusions continues to be strong. Demand is robust, and I think the environment continues to be good for the OEM business, and even though OEM is dilutive to our gross margins, I would like to remind everybody it is accretive to our operating margins and, therefore, a good contributor to Teleflex as it grows.

Speaker Change: I think the environment continues to be to be good for the OEM business and even though OEM is dilutive to our gross margin. So I would like to remind everybody. It is accretive to our operating margins and therefore, a good contributor to teleflex as it grows.

Patrick Andrew Robert Wood: And then, just quickly on the second one, within the urology side of things, obviously you pulled a bit of the sales force back to get some of the training going. A, sort of how is that going? How's the response been internally? And B, how disruptive is that? How long does that kind of training process take? I know it's kind of an open-ended question, but just curious.

Speaker Change: Amazing and then just quickly on the second one.

Speaker Change: Within the urology side of things, obviously, you pulled a bit of a salesforce box to catch some of the training going a sort of how is that going how is the response been internally and b. How disruptive is that how long does that kind of training process take I know, it's kind of an open ended question, but just curious.

Liam J. Kelly: No, that's a fair question, Patrick. I think that the training is going well, so we are proctoring our sales reps. We have about, as we ended the first quarter, roughly around 40% of them trained that need to be trained in this phase. So this will be completed at the end of Q2. And then, over the remainder of the year, we'll take a systematic approach to onboarding additional reps and fully bagging them.

Speaker Change: That's a fair question Patrick.

Speaker Change: I think that the training is going well so we are <unk>.

Speaker Change: Our sales reps.

Speaker Change: We have about as we ended the first quarter, we have roughly around 40% of them trained that need to be trained in this phase. So this will be completed.

Speaker Change: At the end of Q2, and then over the remainder of the year, we will take a systematic approach to onboarding additional reps and full bagging them. We would anticipate that the organization will be fully integrated and all of the trains will be pretty much done by the end of this year and <unk> will be integrated with the good news.

Liam J. Kelly: We would anticipate that the organization will be fully integrated, and all the training will be pretty much done by the end of this year, and Palette will be integrated. The good news is that it has had zero impact. While it did have some impact on Eurolift, it had zero impact on Palette. And Palette, again, six months into our ownership, is performing very well.

Speaker Change: Is that it has had zero impact while it did have some impact on euro lift it had zero impact on <unk> and part of that again six months into our ownership is performing very well.

Operator: Your next question comes from the line of Jayson Bedford from Raymond James. Please go ahead.

Speaker Change: Your next question comes from the line of Jayson Bedford from Raymond James. Please go ahead.

Jayson Tyler Bedford: Good morning. Thanks for taking the questions.

Jayson Tyler Bedford: Good morning, Thanks for taking the questions maybe just to start.

Jayson Tyler Bedford: Maybe just to start for Tom, the first quarter gross margin was above your full year guidance, and revenue will increase from first quarter levels. So what pressures gross margin over the next three quarters?

Tom.

Jayson Tyler Bedford: The first quarter gross margin was above your full year guidance revenue will increase from first quarter levels, what pressures gross margin over the next three quarters.

Thomas E. Powell: Well, I wouldn't say there's anything that necessarily is pressuring over the next number of quarters. Other than what we already saw in the first quarter, which, you know, we've got inflationary pressures, we've got some FX, although we expect FX to improve as the quarters go on. So, you know, obviously, we had a really solid start to the year, and we've provided full-year guidance and are working towards that. I would say that, as a result of the strong start, we feel really good about achieving that guidance, and we'll continue to monitor the situation and provide any updates in the future as the situation warrants.

Tom: Well I wouldn't say there is anything that necessarily is pressuring over the next number of quarters.

Tom: Other than what we already saw in the first quarter, which we've got inflationary pressures. We've got some FX, although we expect FX to improve as the quarters go on.

Tom: Obviously, we had a really solid start to the year.

And we've provided full year guidance and are working towards that.

Tom: I would say that as a result of the strong start we feel really good about achieving that guidance and we will continue to monitor the situation and provide any updates in the future as the situation warrants.

Jayson Tyler Bedford: Fair enough. And then maybe as a quick unrelated follow-up. Interventional, very strong off a tough comp. Liam, you alluded to a few drivers, but just a little bit more granularity. Is this excess share gain? Is there a new product in there that's driving this growth?

Speaker Change: Okay Fair enough and then just maybe as a quick unrelated follow up.

Speaker Change: Interventional.

Speaker Change: Very strong off a tough comp.

Speaker Change: You alluded to a few drivers, but just a little bit more granularity. This excess share gain is there a new product in there.

Speaker Change: What's driving this growth.

Liam J. Kelly: So, I wouldn't exactly call it a new product, but obviously, Manta continues to penetrate the large-bore market, with really solid double-digit growth coming from that product specifically. Complex catheters, which are the bread and butter of this franchise, which are the Guideline or Trapline or Turnpike, they continue to grow within the market. And obviously, then you have our inter-arctic balloon pumps and catheters, really strong performance from them, in particular overseas. So across the board, I think procedural volumes globally in the cath lab are back to pre-pandemic levels.

Liam J. Kelly: So I wouldn't ex-

Speaker Change: So I wouldn't exactly call it a new product, but obviously manta continues to penetrate the large bore market.

Speaker Change: Really solid double digit growth coming from that product, specifically complex catheters, which is the bread and butter of this of this franchise, which is the guideline our topline our turnpike they continue to.

Speaker Change: To grow within the markets and obviously, then you have our intra aortic balloon pumps and catheters.

Speaker Change: Really strong performance from them in particular overseas.

Speaker Change: So across the board I think its a procedure of volumes globally in the Cath lab are back to pre pandemic levels, we're getting some benefit from that but also further penetrating in our accounts.

Liam J. Kelly: We're getting some benefit from that, but also further penetrating into our accounts, having a suite of products to surround Manta, and now having Watson coming to the market in a limited market launch only helps to compound that growth within the cath lab space.

Speaker Change: Having a suite of products to surround manta and now having to Watson coming to the market in a limited market launch only helps too to compound that growth within the Cath lab space.

Operator: Your next question comes from the line of Shagun Singh from RBC Capital Markets. Please go ahead.

Speaker Change: Your next question comes from the line of Sugar thing from RBC capital markets. Please go ahead.

Shagun Singh Chadha: Great, thank you so much. Liam, your guidance calls for about four and a quarter percent growth in 2024 at the midpoint versus six and a half percent last year and your LRP target of the low end of six to seven percent. I know you called out some year-over-year factors to consider, but I'm just wondering what accelerates the growth profile for the company from here? How are you thinking about M&A boosting your weighted average market growth?

Sugar: Great. Thank you so much near real guidance calls for about 4.25% growth in 2024 at the midpoint, which is six 5% last year annual LLP target of the low end of 6% to 7% I know you called out some year over year factors to consider but I'm just wondering what accelerates.

Sugar: The growth profile for the company from here how are you thinking about M&A boosting your weighted average market growth and if you could put all this in the context of your utilization commentary.

Shagun Singh Chadha: And if you could put all this in the context of your utilization commentary, you know, it seems like there isn't a backlog, but there is still healthy demand. That would be really helpful. Thank you for taking the time to answer my question.

Speaker Change: Seems like there is in the backlog, but there is still healthy demand that would be really helpful. Thank you for taking my question.

Liam J. Kelly: No, absolutely, Shagun, and thank you very much for the question. So the midpoint of our guide, you're correct at the midpoint, and I would remind the investment community, as we laid out in, as we gave our guide, there is approximately a percent of a headwind from an inorganic with the MSA in pellets. So if you look at our guide of 3.75 to 4.75, the organic growth underlying that is 4.75 to 5.75.

Speaker Change: And thank you very much for the question. So the midpoint of our guide Youre correct at the midpoint.

Speaker Change: And now I would remind the investment community as we laid out.

Speaker Change: As we gave our guide there was approximately a percent or a headwind from an inorganic with the MSA and <unk>. So if you look at our guide of $3 75 to $4 75, the organic growth underlying that.

Speaker Change: Is $4 75 to 575, so youre jump off into next year, we'll be at a higher range from a growth level, because the MSA will be anniversaried as in.

Liam J. Kelly: So your jump off into next year will be at a higher rate from a growth perspective because the MSA will be anniversary in the fourth quarter. I think the outlook for Teleflex from a growth perspective is solid. I think our 6% long-range plan, we can definitely see line of sight to get there. I think that the environment is rich. We have some parts of our business really performing well. We mentioned OEM.

Speaker Change: In the fourth quarter.

Speaker Change: I think the outlook for teleflex from a growth perspective.

Speaker Change: Is solid I think our 6% long range plan, we can see definitely line of sight to get there.

Speaker Change: I think that the environment is rich we have some parts of our business really performing well we mentioned OEM we mentioned.

Liam J. Kelly: We mentioned interventional access, surgical had a really good start of the year, interventional urology at 6.1%, and then geographically, you see EMEA coming in at 9.7% and double-digit growth in APAC. So I will say that the underlying growth algorithm for Teleflex is very much intact, and as we head into, and we're one quarter into the second year of our LRP, we feel pretty bullish about the outlook for our company Your next question comes from the line of Larry Biegelsen from Wells Fargo. Please go ahead.

Speaker Change: You mentioned all access surgical had a really good start the year interventional urology at six 1% and then geographically.

Speaker Change: See EMEA coming in at nine 7% and double digit growth in APAC. So I will say that the underlying growth algorithm for teleflex is very much intact.

Speaker Change: And as we head into one quarter into the second year of our Ed RFP and we feel pretty bullish about the outlook for our company.

Operator: Your next question comes from the line of Larry Biegelsen from Wells Fargo. Please go ahead. Hi, this is Nathan Treybeck on behalf of Larry. Thanks for taking the question.

Speaker Change: Your next question comes from the line of Larry <unk> from Wells Fargo. Please go ahead.

Speaker Change: Hi, This is Nathan trade back on for Larry. Thanks for taking the question can you talk about given the constant currency beat in Q1, what were some of the considerations for not raising the full year guide.

Lawrence H. Biegelsen: Yeah, so obviously, the first consideration is that it is Q1. And I think you should take that into account. The other consideration is, you know, we gave our guide in February. We had a really, really nice March, so that was helpful.

Speaker Change: Yes, so obviously the one the first consideration is it is Q1.

Speaker Change: You should take that into account and.

Speaker Change: The other consideration is.

Speaker Change: If you we gave our guide in February.

Liam J. Kelly: And we came in above where we thought based on the performance of March and some of the performances that we spoke about earlier. And we did have some OEM orders that pulled in from Q2 into Q1. And we adjusted for FX.

Nathan: Had a really really nice March.

Nathan: So that was that was helpful.

Nathan: And we came in.

Nathan: Above where we thought based on the performance of March and some of the performances that we spoke about earlier on.

Nathan: And.

Nathan: We did have some OEM orders to pulled in from Q2.

Nathan: Into Q1, and we updated for FX. So we'll continue to monitor the situation as we go into Q2 Q3 and Q4.

Liam J. Kelly: So we'll continue to monitor the situation as we go into Q2, Q3 and Q4. But again, I feel fairly bullish on our performance. This is the fifth quarter in a row where we've actually been in a position to beat our internal revenue forecast and be able to provide upside. And it's a nice upside of $11 million. Again, a few million were pulled in from orders from OEMs that shipped in Q1 rather than Q2. But other than that, the underlying growth of the business is really solid. Okay.

Nathan: But again I feel.

Nathan: Fairly bullish on our performance. This is our our fifth quarter in a row, where we've actually been in a position.

Nathan: Beat our internal revenue forecast and to be able to provide upside and its a nice upside of $11 million again, a few million was pulled in from orders from OEM that shipped in Q1, rather than Q2, but other than that the underlying growth of the business is really solid.

Lawrence H. Biegelsen: And can you talk about the drivers of growth for Palette? Is it share gains? Is it market expansion? If you could just give some color there, thanks.

Speaker Change: Okay and can you talk about like the drivers of growth for <unk> is it share gains as the market expansion. If you could just give some color there yes.

Liam J. Kelly: Yeah, the bulk of the growth for Palette is really market expansion. Once we have our additional 50 reps trained, they will now be active in the marketplace in Q3 jewel bags selling that product, so that should also help. And also, in order to expand the market even further, we have initiated, agreed, and funded an additional study for expanded indications for the Barogel product for Palette. We have identified the sites that will conduct the study, and we anticipate beginning enrollment in the very near future. So not alone, we're not satisfied with the market of $330 million. We want to expand that market even further so that we can create more white space for us to grow into.

Speaker Change: The bulk of the growth for <unk> is really market expansion.

Speaker Change: We we have.

Speaker Change: Continued to bring this product to our existing customer base and is being adopted there I mean, there is some there is some share shift.

Speaker Change: But I would say that.

Speaker Change: We are more focused on the white space and trying to take share from others within the marketplace.

Speaker Change: The product is performing exceptionally well the sales force is very very bullish.

Speaker Change: Once we have our additional 50 reps trained they will now be active in the marketplace in Q3.

Speaker Change: By selling that product so.

Speaker Change: That should also help and also in order to expand the market. Even further we have initiated.

Speaker Change: And agreed and funded an additional study for expanded indications for the Vera gel product.

Speaker Change: <unk>.

Speaker Change: <unk> identified the sites that we will conduct a study and we envision beginning enrollment in the very near future. So not alone or we are not satisfied with the market of 330 odd.

Speaker Change: <unk> million dollars, we want to expand that market. Even further so that we can create more white space for us to grow into.

Operator: Your next question comes from the line of Matthew O'Brien from Piper Sandler. Please go ahead.

Speaker Change: Your next question comes from the line of Matthew O'brien from Piper Sandler. Please go ahead.

Matthew Charles Taylor: Morning, thanks for taking the questions, and Tom or Liam, I know you're going to say it's Q1 and everything, but you just beat Q1 by about $0.15 or $0.14 on the bottom line, only taking the low end up by about a nickel, so the midpoint's only going up by about two and a half cents. Why the conservatism there, especially with inflationary pressures easing, and can we just start looking at kind of the higher end of that range, just based on the trends so far?

Matthew Charles Taylor: Good morning, Thanks for taking the questions.

Matthew Charles Taylor: Tom early and I know youre going to say, it's Q1 and everything but you just beat Q1 by about 15 or 14 on the bottom line only taking the low end up by about a nickel. So the midpoint is only going up by about two and a half sense why.

Matthew Charles Taylor: Why the conservatism, there, especially with inflationary pressures easing and can we just start looking at kind of a higher end of that range just based on the trend so far.

Thomas E. Powell: Well, I would just say, first of all, you know, we raised by 9 cents on the lower end, but 5 cents, I should say 4 cents of that was offset by an increase in the foreign exchange rates. So, you know, again, we feel really good about the results in the first quarter. We've provided full-year guidance. We give this with improved confidence in our ability to achieve that full-year guidance, and we'll continue to monitor the situation and provide updates, but again, you know, we are just getting out of the first quarter. This gives us a chance to see a little bit more of how the year is playing out.

Speaker Change: What I would just say first of all we are.

Speaker Change: We we raised by <unk> in the lower end, but <unk> I should say <unk> of that was offset by an increase in the foreign exchange rates.

Speaker Change: So again, we feel really good about the results in the first quarter, we have provided full year guidance.

Speaker Change: It gives us.

Speaker Change: Improved confidence in our ability to achieve that full year guidance. It will continue to monitor the situation and update but again, we are just getting out of the first quarter and.

Speaker Change: It gives us a chance to see a bit more how the year's playing out.

Matthew Charles Taylor: Okay, fair enough. And I wanted to ask about Uralib, but I think the more pertinent questions back on interventional, like Jayson was talking about, you know, that performance has been very strong for several quarters in a row here. You've got, you know, this focus on structural heart. It's one of the fastest growing areas in MedTech. You've got Watson coming.

Speaker Change: Okay fair enough and I wanted to ask about Europe.

Speaker Change: Thank you.

Speaker Change: More pertinent questions back on interventional like Jason was talking about.

Speaker Change: Performance has been.

Speaker Change: Very strong for several quarters in a row here.

Speaker Change: This focus on structural heart, it's one of the fastest growth areas of Med Tech you bought Watson coming.

Liam J. Kelly: Is this an area that can deliver, you know, not necessarily this level of growth but, you know, well above Teleflex levels of growth for the next several years? And is this an area of focus, maybe from an M&A perspective as well, just given the strong underlying performance of the market in general? Thank you.

Speaker Change: Is this an area that can deliver.

Speaker Change: No.

Speaker Change: Not necessarily this level of growth, but just well above teleflex levels of growth for the next several years and is this an area of focus maybe from an M&A perspective, as well just given the strong underlying performance.

Operator: So I'll start with the last part of your question. It's definitely a focus for M&A, Matt. I've said many times that I like the Cat Lab as a call point. We now have a global franchise for that call point, and it is one of the key areas of focus for us when we do M&A. It's not the only area of focus, but it's a key area of focus. With regard to the sustainability of growth, I think that the interventional portfolio that we have, you know, with Manta in there, with Watson coming in there, we've got Ringer coming down the road.

Speaker Change: Performance of the market in general. Thank you so I'll start with the with the last part of your question, it's definitely a focus for M&A.

Speaker Change: Matt.

Matt: I've said many times that I liked the Cath lab is a call point.

Speaker Change: We now have a global franchise with that call point and it is one of the key areas of focus for us when we're doing M&A, it's not the only area of focus, but it's a key area of focus.

Speaker Change: With regards to the sustainability of the growth I think that the interventional portfolio that we have.

Speaker Change: With Manta in there would watson coming in there, we got ringer coming down the road, we've got triumph, that's going to be launched.

Operator: We've got Triumph that's going to be launched sometime in 2025. So we have a whole suite of products coming into this call point, and we have invested heavily in the R&D organization there to ensure that we have this suite of products coming through. So I think it's well capable of maintaining well above Teleflex's average growth and be a growth driver for Teleflex over a multi-year period just based on that background.

Speaker Change: In sometime in 2025, so we have a whole suite of products coming into this this call point.

Speaker Change: And we have invested heavily in the R&D organization there to ensure that we have the suite of products coming through.

Speaker Change: I think it's well capable of maintaining well above teleflex average growth and be a growth driver for teleflex over a multiyear period, just based on that background, but it has come at the back of investment. This is one of our areas, where we we have we have invested behind.

Operator: But it has come at the back of investment. This is one of our areas where we have invested behind, and the acquisition of Manta a number of years ago is playing out really well as we penetrate that large foreclosure market.

Speaker Change: And the acquisition of <unk>, a number of years ago is playing out really well as we penetrate that large bore closure market.

Anthony Charles Petrone: Your next question comes from the line of Anthony Petrone from Mitzoha Financial Group. Please go ahead.

Speaker Change: Your next question comes from the line of Anthony Petrone from Mizuho Financial Group. Please go ahead.

Anthony Charles Petrone: Thank you and hope everyone's doing well. Congratulations on a strong 1Q here. Maybe a couple questions.

Anthony Charles Petrone: Thank you and I hope everyone's doing well congrats on a strong Q here, maybe a couple of questions. One just actually focused on the Americas surprised to see just regionally Americas actually being down a touch here and then when you sort of bridge that to some of the divisions vascular was pretty good OEM, obviously outperformed even intervention.

Anthony Charles Petrone: One just actually focused in on the Americas. Surprised to see just how regionally America is actually down a touch here and then when you sort of bridge that to some of the, you know, divisions. Vascular was pretty good, but OEM obviously outperformed. Even interventional urology is a touch ahead of our numbers. So where specifically in the U.S. was there slippage? Was it tough comps, or was there, you know, other stocking dynamics in the U.S. and all of one...

Speaker Change: And I'll wrap urology as touch ahead of our numbers, so where specifically in the U S was there slippage was a tough comps or was there other stocking dynamics in the U S and I'll have one follow up thanks.

Liam J. Kelly: Yeah, Anthony, and thank you. I hope you're doing well as well.

Speaker Change: Yes, Andrew Yes, Thank you I hope, you're keeping well as well.

Speaker Change: Thanks for the question with regard to the America is the biggest impact there Anthony was the MSA.

Liam J. Kelly: Thanks for the question. With regard to the Americas, the biggest impact there, Anthony, was the MSA. If you'll recall, all of the MSA was booked in the Americas. So if you backed out the MSA from that, your growth would have been around 3.5% for the Americas if you took the MSA out. The underlying There's a few underlying things I want to point out in the Americas as you go through the year. The endurance recall is mostly impacted, and that's in vascular, that mostly impacts the Americas.

Speaker Change: If you'll recall all of the MSA was booked in the Americas. So if you backed out the <unk>.

Speaker Change: Say from that your growth would have been around three 5% for the Americas. If you took the MSA out.

Speaker Change: At the underlying does a few underlying things I'd want to point out the Americas as you go through the year, the endurance recall, mostly impacted and thats in vascular that mostly impacted the Americas.

Liam J. Kelly: So as you get through Q2 and into Q3, you will have anniversaries for that. And then if you look into Q4, we will also anniversary the MSA. So you will see an improving environment for the Americas as you go through the year. But please do bear in mind that MSA, Anthony, it's all booked in the Americas, and it's all coming out of the Americas on a year-over-year basis. And that's really the drag on that one.

Speaker Change: So as you get through Q2 and into Q3, you will have anniversaried that and then if you look into Q4. We will also have and we will also anniversary. The MSA. So you will see an improving environment for the Americas as you go through the year, but please do bear in mind that MSA Anthony.

Speaker Change: It's all booked in the Americas and its all coming out of the Americas on a year over year basis, and Thats really the drag on that one.

Anthony Charles Petrone: And you had a follow-up, Anthony. Yeah, one quick follow-up would just be a high-level revisit of the M&A strategy here at Teleflex. The company has been active over the years, and it's done a number of different transactions. I remember the years of distributor tuck-in.

Speaker Change: And you had a follow up Anthony yes.

Speaker Change: Follow up will just be a high level revisit on the M&A strategy here at Teleflex.

Anthony Charles Petrone: The company has been active over the years and it's done a number of different transactions I remember the years of the distributor tuck ins there have been some R&D plays, but but not as prevalent as the.

Liam J. Kelly: There have been some R&D plays, but not as prevalent as the, you know, sort of here and now revenue generating growth accretive deals. And of course, the EBITDA level is now higher. And so maybe just a revisit of the strategy. What is most prioritized, and what are the size of transactions that you're contemplating these days? Thanks a lot.

Speaker Change: Sort of here and now revenue generating growth accretive deals and of course, the EBITDA level is now higher and so maybe just to revisit on the strategy. What is most prioritized and what are the size of transactions that youre contemplating. These days thanks a lot.

Operator: So, I think that for Teleflex, we're really focused on tuck-ins and scale transactions. We have done some late-stage technologies, and we've done some investments, early-stage investments into companies, and we continue to do that. We have the most important thing you need, Anthony, for M&A, which is firepower. So, as Tom said in his prepared remarks, we're 1.7 times levered, so we have lots of firepower. We are at the moment chasing lots of assets, I will tell you, and they do fit in the range from a tuck-in of revenue of, you know, call it in the tens of millions, to scale transactions in the hundreds of millions.

Speaker Change: So I think that for Teleflex, we're really focused on tuck ins and scale transactions. We have done some late stage technologies and we've done some investments early stage investments into companies and we'll continue to do that.

Speaker Change: The most important thing you need Anthony for M&A.

Speaker Change: Which is firepower so as Tom said in his prepared remarks were one seven times levered. So we have lots of firepower. We are at the moment chasing lots of assets I will tell you in the end they do fit in the range from a token of revenue.

Speaker Change: And the in the in the tens of millions.

Speaker Change: To scale transactions in the hundreds of millions.

Operator: We are cognizant of dilution, especially in this year where you have the MSA going away so dilutive, and you have Palette coming in so dilutive. The underlying earnings growth is in that 8% to 10%, as Tom outlined in his remarks, but I think investors want to see that, so we are keeping that in mind. We are disciplined, Anthony, and we will remain disciplined. I think that, finally, the multiples seem to have tempered somewhat, at least.

Speaker Change: We are cognizant of dilution, especially in this year, where you have the MSA going away. This dilutive do you have a lot coming in this dilutive at the underlying earnings growth is in that 8% to 10% as Tom outlined in his remarks.

Speaker Change: But I think investors want to see that so we are keeping that in mind, we are disciplined Anthony and we will remain disciplined.

Speaker Change: Finally, the multiples seem to have tempered.

Speaker Change: Somewhat at least.

Operator: You know, some of the high-growth assets on the public markets are not carrying the value that they were 12 months ago, and obviously, that plays into the psyche of the seller as well, and it's obviously, as a buyer, you can point to really great companies on the public markets, super companies, but they are not carrying the value that they held 12 or 18 months ago, and that should be reflective of private companies as well. So it is a healthy environment. Lots of assets and a very, very disciplined Teleflex.

Speaker Change: Some of the high growth assets on the public markets are not carrying the value that they were 12 months ago, and obviously that plays into the psyche of the seller as well and it's obviously as a as a buyer you can point to really great companies on the public market Super companies, but not carrying the value that they has 12.

Speaker Change: Were 18 months ago, and that should be reflective in private companies as well so a healthy environment.

Speaker Change: Lots of assets and a very very disciplined to teleflex.

Michael K. Polark: Before we continue on to the next question, a reminder, if you would like to raise your hand and join the queue, please press star 1 on your telephone keypad now. And your next question comes from the line of Mike Polark from Wolf Research. Please go ahead.

Speaker Change: Before we continue on to the next question. A reminder, if you would like to raise your hand and joined the queue. Please press star one on your telephone keypad now and your next question comes from the line of Mike Polack from Wolfe Research. Please go ahead.

Michael K. Polark: Good morning, thank you for taking the questions. I'm curious about this CLEAR trial that's reading out at AUA over the weekend, Urolith versus Resume, what's reasonable to expect there? Is there an impact in the field you anticipate as the data is disclosed?

Mike Polack: Hey, good morning. Thank you for taking my questions I'm curious on the clear trial, that's reading out at over the weekend euro lift versus resume.

Mike Polack: What's reasonable to expect there is there an impact in the field you.

Michael K. Polark: Do you anticipate as the data is disclosed.

Liam J. Kelly: Hey, Mike, look, we've got a lot of data coming out at the AUA. We have five different papers that are being read out. And there are a number of other studies, one in particular coming from the European group about early intervention with minimally invasive therapies and how that's much better than having individuals on pharma. With regard to the specific one that you're talking about, it's really focused on more rapid symptom relief and quality of life improvement post-treatment comparing Urolift to Resume, and outcomes that can aid healthcare providers and patients in getting a clearer understanding of the post-operative experience that a patient experiences with the product.

Speaker Change: Hey, Mike look we have a lot of we have a lot of data coming out.

Liam J. Kelly: At the at the <unk>.

Mike Polack: We have five different papers.

Mike Polack: Are being read out and there are a number of other studies.

Mike Polack: One in particular that are coming from the European group about early intervention on minimally invasive therapies and that's much better than having individuals.

Mike Polack: On pharma with regards to the.

Liam J. Kelly: The specific ones that you're talking about.

Liam J. Kelly: It's really focused on more rapid symptom relief and quality of life improvement post treatment comparing euro lift.

Liam J. Kelly: To resume.

Liam J. Kelly: And.

Liam J. Kelly: Outcomes that can aid health care providers and patients and getting a clear understanding of the Polish.

Liam J. Kelly: Post operative experience that a patient experiences with the product I think there is a.

Liam J. Kelly: I think there's a study on retreatment rates which I'm really looking forward to hearing. I'm actually attending the conference myself. And also, there's a real world study on complications of all BPH treatments, and I think that's going to be enlightening as well. So I think we've got a full suite of podium presence at the AUA, and I think that for sure, any of these head-to-heads, either comparing EuroLift to Resume, comparing it to other technologies, or comparing it to drugs, will be helpful for the sales force.

Liam J. Kelly: The study on on re treatment rates, which I'm really looking forward.

Liam J. Kelly: Hearing I'm actually attending the conference myself and also there is a real world study.

Liam J. Kelly: On complications of all.

Liam J. Kelly: BPH treatments and I think that's going to be enlightening as well. So I think we've got a full suite of podium presence at the EUA and I think that for sure any of these head to heads either comparing your lift to resume comparing it to other technologies comparing it to drugs will be helpful for the sales force.

Michael K. Polark: I appreciate that, Liam, thank you. If I may follow up on urology as well, on the numbers, I just wanna make sure I understand performance in the quarter, the expectation for the year. So if I'm doing the math correct, I have. I think if I do the guidance for the full year, you know, perhaps a year lift down 10%. And so I just want to understand.

Speaker Change: I appreciate that Liam. Thank you if I may follow up on on urology as well on the numbers I just want to make sure I'm understanding.

Michael K. Polark: The performance in the quarter the expectation for the year. So if I'm doing the math correct I have.

Michael K. Polark: Net of pull at Euro lift maybe down high teens year on year, and I think if I do the guidance for the full year.

Michael K. Polark: Perhaps you're locked down 10% and so I just want to understand.

Michael K. Polark: One, for the first quarter, have I done the math correct? And you said that it aligned with your internal plan, and I just want to make sure that that's all fair. And then two, kind of the path for EuroLifts to be better over the course of the year. It sounds like the sales force not being retrained and out in the field double-bag probably is a piece of that. But anything else you might be able to offer as to why we get that product line trending back up the rest of the year would be helpful. Thank you. Yeah, absolutely.

Michael K. Polark: One for the first quarter of I've done the math correct and you said that aligned with your internal plan and I just want to make sure that that's all fair and then and then two kind of the path for euro lift to be better over the course of the year. It sounds like the sales force no longer being retrained in and out in the field double bag.

Michael K. Polark: As a piece of that but anything else you might be able to offer as to kind of why we get.

Michael K. Polark: That product line trending back up the rest of the year would be helpful. Thank you.

Liam J. Kelly: Yeah, absolutely, Mike. Look, we've discussed this on previous calls. We're not going to, we're going to report on total interventional urology consistent with all of our global product categories and businesses, and we're not going to provide product-level revenue details for individual business lines or product categories within those. You know, we have four reportable segments. We also have six product segments. So there are 10 ways to slice and dice Teleflex, but let me give you a little bit of color.

Speaker Change: Yes, absolutely Mike look at and we've discussed this on previous calls we're not going to we're going to report on total intervention all urology consistent.

Liam J. Kelly: With all of our global product categories and businesses and we're not going to provide product level revenue details for individual business lines or product categories within those.

Liam J. Kelly: Four reportable segments, we've six.

Liam J. Kelly: Product segments. So there's 10 ways to slice and dice teleflex, but let me give you a little bit of color, having said that let me start with the full year and then I'll go back to the quarter.

Liam J. Kelly: Having said that, let me start with the full year and then I'll go back to the quarter. For the full year, we are expecting, and nothing has changed in our expectations for interventional urology. I am extremely confident that we will be able to deliver 7.5% growth in 2024, which is at the midpoint of our guidance. This includes revenue for Pellet Life Sciences of $66 to $68 million, offsetting the year-over-year declines in UroLift. Now, in the quarter, interventional urology grew 6.1%.

Liam J. Kelly: For the full year.

Liam J. Kelly: We.

Liam J. Kelly: Expecting.

Liam J. Kelly: Nothing has changed in our expectation for interventional urology, where I am extremely confident of being able to deliver seven 5% growth in 2024.

Liam J. Kelly: Which was at the midpoint of our guidance at this includes revenue from <unk> life Sciences of $66 million to $68 million offsetting the year over year declines in your lift.

Liam J. Kelly: Pellet came in in line with our expectations and continues to perform very well. UroLift performance was also within our expectations. And as we expected, UroLift was impacted by the declines in the office side of the service, but also from the cross-training. And your insights are correct, Mike. As we go through the year, that cross-training will be more or less completed for those 50 once you get into Q3 and beyond. So feel good about the 7.5% on a full year basis for the interventional urology business.

Liam J. Kelly: In the quarter Interventional Urology grew six 1% <unk> came in in line with our expectations and continues to perform very well Europe performance was also within our expectations and as we expected your lift was impacted.

Liam J. Kelly: By the declines in the Alpha say the service, but also from the cross training.

Liam J. Kelly: Your insights are correct, Mike as we go through the year that cross training will be more or less completed for those 50. Once you get into Q3 and beyond so feel real good about the seven 5% on a full year basis for the interventional urology business unit.

Operator: Your next question comes from the line of Craig Bijou from Bank of America. Please go ahead.

Liam J. Kelly: Your next question comes from the line of Craig Bijou from Bank of America. Please go ahead.

Craig William Bijou: Good morning, guys. Thanks for taking the questions. Liam, I know you're not going to get into the specifics on 25, but street expectations for margin expansion have come down looking at 25. So, maybe if you could just talk about some of the opportunities to expand margins in 25 and how those might be lining up, maybe without actually giving specifics, but just kind of talking about where you could see some improvement.

Craig William Bijou: Good morning, guys. Thanks, Thanks for taking the questions.

Craig William Bijou: I know youre not going to get into the specifics on 25, but.

Craig William Bijou: Street expectations for margin expansion have come down looking at 25 so.

Craig William Bijou: Maybe if you could just talk about some of the opportunities to expand margins in 'twenty, five and how those might be lining up maybe without.

Craig William Bijou: Given specifics, but just kind of talking about where you could see some improvement.

Liam J. Kelly: Well, I think Craig, it all starts at the gross margin line. And if you look at this year, you know, at the midpoint, we're going to expand our gross margins by about 100 basis points. We've had a really good start to the year. Gross margins expanded 170 basis points in the first quarter of the year. So, God rest my mother. She used to say a good start is half the battle, and we've had a really good start on the gross margin line.

Liam: Well I think Craig it all starts at the gross margin line.

Liam J. Kelly: And if you look at.

Liam J. Kelly: This year.

Liam J. Kelly: We're at the mid point, we're going to expand our gross margins by about 100 basis points. We've had a really good start to the year gross margins expanded 170 basis points in the first quarter of the year. So.

Liam J. Kelly: The address my mother, she used to say a good start is half the battle and we've had a really good start on the gross margin line.

Liam J. Kelly: As you look forward, we have a number of catalysts for the gross margin line to come into being. We continue to have continuous improvement programs within our global supply chain team. We'll have Palette; the MSA will be behind us when we get into 2025. Palette will be continuing to ramp when we get into 2025.

Liam J. Kelly: As you look forward, we have a number of catalysts for the for the gross margin line to come into being.

Liam J. Kelly: We continue to have continuous improvement programs within our global supply chain team.

Liam J. Kelly: We will have.

Liam J. Kelly: The MSA will be behind us when we get into 2025.

Liam J. Kelly: <unk> will be continuing to ramp when we get into 2025. So those two factors will obviously help our gross margins.

Liam J. Kelly: So those two factors will obviously help our gross margins, and I believe we'll continue to have positive pricing in 2025. So that mix and positive pricing, and continuous improvement programs. And then, for Palette specifically, you'll begin to get leverage on the op margin line, where it becomes accretive to the op margin. And we're a very disciplined company in terms of our OPEX. So I do believe that it all begins and ends with the gross margin line, and it'll drop through to operating margin in the future.

Liam J. Kelly: And I believe we'll continue to have positive pricing in 25, so that mix and positive pricing continuous improvement.

Liam J. Kelly: Yeah.

Liam J. Kelly: Programs, and then propel that specific when you begin to get leverage to the op margin line, where it becomes accretive to the op margin and we're a very disciplined company on our Opex. So I do believe that it all begins and ends with the gross margin line.

Liam J. Kelly: And it will drop through to operating margin.

Liam J. Kelly: And I feel good about our prospects to continue to drive both gross and operating margin leverage on a solid 6% top-line growth for Teleflex and underlying 10% EPS growth, which is pretty much what we're delivering this year.

Liam J. Kelly: Into the future and I feel good about our prospects to continue to drive both gross and operating margin leverage on a solid 6% topline growth for teleflex and underlying 10% EPS growth.

Liam J. Kelly: Pretty much what we are delivering this year.

Craig William Bijou: Got it. Thanks, Liam. And if I could follow up on maybe some standard bariatrics and Titan and, you know, as you expand the product offering there, maybe you can just give us a revisit, kind of how to think about the contribution from Titan and Standard Bariatrics in 24 and going forward, and maybe what the new commercial updates or the new product expansion can do for growth.

Speaker Change: Got it thanks for him and if I could follow up on maybe some standard bariatrics and tightened and as you expand the product offering there.

Craig William Bijou: Maybe you can just give us revisit how to think about the contribution from from tightened and standard bariatrics and.

Craig William Bijou: In 'twenty, four and going forward and maybe what the new commercial updates or the new product expansion, Ken can do for growth.

Liam J. Kelly: Yeah, thanks Craig. So first of all, in the product expansion, having a buttress is an important add-on to the Titan product. 60% of surgeons who do bariatric sleeves use buttresses. Technically, the Titan product doesn't need buttresses because of the seal pressure and that very high burst pressure, but it's what they want to use.

Liam: Yes, Thanks, Craig So first of all on the product expansion, having buttress is an important add on to the Titan product.

Liam J. Kelly: 60% of surgeons, who do barrier gastric sleeve skus buttress.

Liam J. Kelly: Technically the tightened product doesn't need buttress because of the sea of pressure and a very high bar pressure.

Liam J. Kelly: So we've given them what they want to use, and it's been very well received by the bariatric community. I will tell you that in Q1, Titan came in line with our expectations. So that was good to start the year out in that regard.

Liam J. Kelly: But.

Speaker Change: It's what they want to use so we've given them.

Liam J. Kelly: What they want to use and it's been very well received by the bariatric.

Liam J. Kelly: Community and I will tell you that in Q1 tightened came in in line with our expectations. So that was a that was good to start the year out in that regard.

Liam J. Kelly: And I do still believe that it's going to be a contributor to growth.

Liam J. Kelly: And I do still believe that it's going to be a contributor to growth this year and in future years. Just to give some color on what's happening with gastric sleeves at a macro level, I think investors would be interested in that. So in the second half of the year, we saw gastric sleeve procedures down 10 to 15 percent. So I think what that means for Teleflex is the market we're growing into is a little bit smaller potentially than the 250 million plus that we outlined it at. But at the end of the day, it's still a big market to grow into with lots of opportunity for us to penetrate the Titan product into that gastric sleeve.

Liam J. Kelly: This year and in future years.

Liam J. Kelly: Just to give some color on what's happening with gastric sleeves on a macro level I think investors would be interested in that so in the second half of the year, we saw gastric sleeve.

Liam J. Kelly: Procedures down 10% to 15%. So I think what that means for teleflex is the market, we're growing into that a little bit smaller potentially than the $250 million plus that we have outlined to that but at the end of the day, it's still a big market to grow into with lots of opportunity for us to to.

Liam J. Kelly: Penetration tightened product into that gastric sleeve market.

Liam J. Kelly: Your next question comes from the line. Sorry, I just want to add one other thing, Craig. We had a robust proctoring and training of surgeons in the quarter.

Speaker Change: Your next question comes from Greg Im sorry, Im sorry, I just want to add one other thing Craig.

Liam J. Kelly: Again in the quarter, we had a robust <unk> and training of surgeons in the quarter My apologies to put to you across <unk> you operator.

Liam J. Kelly: My apologies for cutting you off. Not a problem at all. Your next question comes from Richard Newitter from Truist Securities. Please go ahead.

Richard Samuel Newitter: Not a problem at all your next question comes from the line of Richard <unk> from <unk> Securities. Please go ahead.

Operator: Hey guys, thanks for taking the question. It's actually Sam on for Rich here. Just the first one from us on 2Q and 760 to 765, touch below street there. Some of that's from FX, some of that's from the OEM pull forward, but just anything else that you call out in 2Q, sort of explaining the delta between street and guidance.

Richard Samuel Newitter: Hey, guys. Thanks for taking my question, it's actually Sam on for Rich here, just first one from us on <unk> and 767, she can drive a touch below street near some of Thats from FX. Some of that is from from the OEM pull forward.

Operator: Anything.

Operator: Else that you'd call out in Q sort of explaining the delta between screening and guidance.

Richard Samuel Newitter: No, they're the two big buckets, Sam. There are about 6 million FX in Q2, and also there are a few million OEM products that were originally planned to be shipped in Q2. Just bear in mind that the MSA was slightly higher in Q2. That's something to keep in mind. And as we go through the year, you've got that dynamic of the MSA, and you also have the dynamic of Palette ramping up as you go through the year. So you've hit on the two main impacts in Q2, 760, 765, you know, 3 to 3.7%, and we feel good in our ability to deliver that.

Speaker Change: No there are two big buckets.

Richard Samuel Newitter: About $6 million of FX.

Richard Samuel Newitter: In Q2 and also there is a few million dollars.

Richard Samuel Newitter: OEM products that were originally planned to be shipped in Q2.

Richard Samuel Newitter: Just bear in mind that the MSA was slightly higher than in Q2, that's something just to just to just to bear in mind.

Richard Samuel Newitter: As we go through the year, you've got that dynamic.

Richard Samuel Newitter: Of the MSA and you also have the dynamic of pellet ramping as you go through the year. So you've hit on the two main impacts on Q2, 760, 765, 3% three 7%.

Richard Samuel Newitter: And we feel good in our ability to deliver that.

Liam J. Kelly: Great. And then just on Palette, I know, try to avoid giving the product specifically, you've given us the 66 to 68. Just curious what you'd be looking for in the market or in results to take that range up, and what could give you confidence there. Thanks for taking the question. Yes.

Speaker Change: Okay, and then just on Poland.

Liam J. Kelly: Try to avoid giving a product specifically you give enough given us with 66 to 68, just curious whether you'd be looking for in the market or in results to take that range up and what can give you confidence there. Thanks for taking my questions.

Richard Samuel Newitter: Yes, so it started very well, that's the first thing I would say. The second thing I would say is that there was a lot of enthusiasm for the product. The third thing I would say is that expanding the indications is a key strategy for us, not for this year, but in the coming years, to continue to grow that. And that will be a unique indication that no other spacing technology will be able to address. I think that the product, the fact that you can actually see it, is very visible.

Liam J. Kelly: Yes.

Speaker Change: So it started very well.

Richard Samuel Newitter: First thing I would say the second thing I would say, there's a lot of enthusiasm for the product the targeting I would say the expanding of the indications as a key strategy for us not for this year, but in the outer years to continue to to to grow that.

Richard Samuel Newitter: And that would be a unique indication that no other spacing technology, we'll be able to address.

Richard Samuel Newitter: I think that the product.

Richard Samuel Newitter: No.

Richard Samuel Newitter: The fact that you can actually the product is very visible. The fact that you can move the product. The fact that you don't have to rush with the product is really.

Richard Samuel Newitter: The fact that you can mold the product, the fact that you don't have to rush with the product is really..., is landing really well with both the radiation oncology community and the urology community. So we'll get another quarter or two tucked under our belt, Sam, and then we'll come back to the investment community with our thoughts on the 66 to 68 million. But as I sit here today, I feel really good about the 66 to 68.

Richard Samuel Newitter: Really.

Richard Samuel Newitter: Really landing really well with both the radiation oncology community and the urology community.

Richard Samuel Newitter: So we will get another quarter or two tuck under our belt and then we'll come back to the investment community about our thoughts on the $66 million to $68 million, but as I sit here today feel really good about the 66 to 68.

Operator: And your next question comes from the line of Kristen Stewart from CL King. Please go ahead. Hi, thanks for taking my question.

Liam J. Kelly: And your next question comes from the line of Kristen Stewart from CL King.

Richard Samuel Newitter: And your next question comes from the line of Kristen Stewart from C. L. King. Please go ahead.

Kristen Marie Stewart: Hi, Thanks for taking my question.

Kristen Marie Stewart: Just wanted to touch on the vascular access business that came in a little bit lighter than where I was expecting can you maybe just comment on the performance there in the quarter and what we should expect for the balance of the year.

Kristen Marie Stewart: Yeah, Kristen, that's a good observation and a good question. You know, the endurance recall impacted the vascular business in Q1, and we'll anniversary that as we go through Q2. So when you get into Q3, you'll have a clean look at vascular, and you should see it improve as you go through the year. The other thing I would say about the vascular business is that the underlying PICC growth was really solid, but that will improve too as we go through the year.

Kristen Marie Stewart: Yes, Chris that's a good observation and a good question.

Kristen Marie Stewart: The endurance recall impacted the vascular business.

Kristen Marie Stewart: In Q1, and we'll anniversary that as we go through Q2. So when you get into Q3, you'll have you'll have a clean look at vascular. So you should see vascular improve as you go through the year.

Kristen Marie Stewart: The other thing I would say on the vascular business.

Kristen Marie Stewart: The underlying <unk> growth was really solid but that will improve too as we go through the year I would anticipate seeing.

Kristen Marie Stewart: I would anticipate seeing PICC volumes pick up as we go through the year. The underlying CVC growth is really solid, and we're really happy with how that's performing. So all in all, it's really the endurance anniversary for that, and an improved environment for PICCs to continue to grow as we go through the year.

Kristen Marie Stewart: Seeing peak volumes pick up as we go through the year the underlying CVC growth is really solid and we're really happy with how thats performing so all in all its really the endurance.

Kristen Marie Stewart: Anniversarying that and an improved environment for <unk> continuing to grow as you go through the year.

Speaker Change: Okay. Thanks very much.

Kristen Marie Stewart: Chris.

Lawrence Keusch: And that concludes our Q&A session for today. I would like to hand the floor back over to Lawrence Keusch for closing remarks. Thank you.

Kristen Marie Stewart: And that concludes our Q&A session for today I would like to hand back over to Lawrence <unk> for closing remarks.

Operator: Thank you, Polly, and thank you to everyone that joined us on the call today. This concludes the Teleflex Incorporated first quarter 2024 earnings conference. Thank you for joining us. You may now disconnect your line. Please wait, the conference will begin shortly.

Lawrence Keusch: Thank you Polly and thank you to everyone that joined us on the call today.

Speaker Change: This concludes the Teleflex incorporated first quarter 2024 earnings conference call.

Operator: Thank you for joining us. You may now disconnect your line. Please wait; the conference will begin shortly.

Speaker Change: Thank you for joining US you may now disconnect your lines.

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