Question-and-Answer SessionDamien McDonaldCEO & Director Well, first of all, thanks for having us today. I really appreciate UBS hosting us and you, Danielle. Thank you. I'll try not to get into a monologue about why I'm so excited about this company, but it's a few things. So firstly, on Enovis, if you don't know the company, we're a challenger brand in the orthopedic space to the big 4. I think really what differentiates us is 2 things. Firstly, if you think about the portfolio, we're an innovative portfo ...

Summary of Enovis Conference Call Company Overview - Enovis is positioned as a challenger brand in the orthopedic space, competing against the Big Four companies in the industry [2][3] - The company has a balanced portfolio with 50% of its business in the U.S. and 50% internationally, and it covers the entire patient continuum from prevention to recovery [3][4] Key Differentiators - Enovis emphasizes its innovative portfolio and agility in decision-making, which allows for close customer relationships and influence on product development [3][4] - The company aims to enhance commercial execution, operational excellence, and financial discipline to drive cash flow generation and reduce debt [5][10] Capital Allocation Strategy - Enovis has focused on integrating the Lima acquisition, which has performed better than expected, and is now prioritizing organic growth and debt reduction before pursuing further M&A [10][11] - The company is exploring various acquisition opportunities, including channel acquisitions and geographic expansions, but remains focused on the orthopedic sector [12][14] Product Pipeline and Innovations - The Arvis product is expected to be a significant growth driver, particularly in knee and shoulder segments, with a flexible customer-centric model for adoption [19][20] - Recent product launches, such as the augmented glenoid and hip systems, are performing well and are expected to capture a larger market share [26][27] Market Dynamics - The orthopedic market is experiencing growth, particularly in international markets, with a strong demand for shoulder procedures [29][30] - Enovis is leveraging its strong position in shoulder to expand its presence in hips and knees, although it currently holds low market shares in these areas [30][31] Pricing and Competitive Landscape - The company has been able to maintain competitive pricing in the PNR market, with slight price increases to offset inflation [31][32] - Enovis is focused on innovation in implant design to attract key opinion leaders and drive market share [32][34] Financial Performance and Projections - Enovis generated approximately $30 million in cash with a 70% free cash flow conversion in Q3, with expectations to improve cash flow generation moving forward [54][55] - The company anticipates EBITDA margin expansion driven by synergies from the Lima acquisition and a favorable business mix [57][58] Strategic Focus Areas - Enovis aims to maintain a balanced portfolio between recon and PNR, with a focus on solid growth in both areas to support cash generation for higher-growth segments [62][64] - The company sees opportunities in sports medicine and plans to explore this area further [65][66] Personalization and Innovation - Enovis is investing in personalized implant solutions, leveraging AI for process improvements, and aims to enhance its competitive advantage in this area [75][76] Investor Insights - There is a focus on improving cash generation and reducing leverage, with a target to bring the leverage ratio below three [78][79] - The company believes that as cash flow improves and debt is reduced, the market valuation will better reflect its potential [78]

Medical technology company Enovis Corporation (NYSE:ENOV) reported revenue ahead of Wall Streets expectations in Q3 CY2025, with sales up 8.6% year on year to $548.9 million. The company expects the full year’s revenue to be around $2.26 billion, close to analysts’ estimates. Its non-GAAP profit of $0.75 per share was 15.6% above analysts’ consensus estimates. Is now the time to buy ENOV? Find out in our full research report (it’s free for active Edge members). Enovis (ENOV) Q3 CY2025 Highlights: Reven ...

Third Quarter 2025 Results November 6, 2025 This presentation includes forward-looking statements, including forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Such forward- looking statements include, but are not limited to, statements concerning Enovis' plans, goals, objectives, outlook, expectations and intentions, and other statements that are not historical or current fact. Forward-looking statements and are based on Enovis' current expectations ...

Financial Performance - Enovis reported third-quarter net sales of $549 million, representing a 9% increase on a reported basis and a 7% increase on an organic basis compared to the same quarter in 2024[3]. - The company experienced a net loss of $571 million, equating to 104.0% of sales, primarily due to a non-cash goodwill impairment charge of $548 million[4]. - Adjusted EBITDA for the third quarter was $95 million, or 17.3% of sales, with adjusted net earnings per diluted share at $0.75[4][5]. - The gross profit margin for the third quarter was reported at 59.9%, an increase from 56.7% in the same quarter of 2024[20]. - Enovis Corporation reported a net loss of $570.9 million for the three months ended October 3, 2025, compared to a net loss of $31.3 million for the same period in 2024, reflecting a net loss margin of (104.0)%[22]. - Adjusted net income from continuing operations for the three months ended October 3, 2025, was $43.5 million, with an adjusted net income margin of 7.9%, compared to $41.0 million and 8.1% in the prior year[22]. - The company reported a net loss per share of $(9.99) for the three months ended October 3, 2025, compared to $(0.61) for the same period in 2024[22]. - Total net loss from continuing operations attributable to Enovis Corporation was $571.1 million for the three months ended October 3, 2025, compared to $33.8 million in the prior year[23]. - The company reported a net loss margin of (39.7)% for the nine months ended October 3, 2025, compared to (7.9)% for the same period in 2024[22]. - The company reported a net loss of $663.2 million for the nine months ended October 3, 2025, compared to a net loss of $121.6 million for the same period in 2024[31]. Sales Growth - Reconstructive sales grew 12% year-over-year on a reported basis and 9% organically, while Prevention & Recovery sales increased by 6% on a reported basis and 4% organically[3][6]. - Net sales for the three months ended October 3, 2025, were $548.9 million, an increase of 8.6% compared to $505.2 million for the same period in 2024[33]. - For the three months ended September 27, 2024, total net sales reached $505.2 million, reflecting an increase of 8.7% compared to the previous period[35]. - For the nine months ended October 3, 2025, total net sales increased to $1,672.3 million, showing a growth of 8.1%[35]. - Existing businesses contributed $33.0 million to the total sales growth, representing a 6.5% increase[35]. - The sales growth from existing businesses for the nine months was $113.1 million, which is a 7.3% increase[35]. - Foreign currency translation positively impacted sales by $14.1 million for the nine months, accounting for a 0.9% increase[35]. - Acquisitions contributed $2.8 million to the nine-month sales growth, representing a 0.2% increase[35]. - The impact of divestitures for the nine months was a decrease of $4.3 million, which is a 0.3% decline[35]. - The company experienced a foreign currency translation impact of $14.1 million for the nine months, contributing to overall sales growth[35]. Guidance and Strategic Focus - Enovis updated its 2025 revenue guidance to a range of $2.24-2.27 billion, reflecting a $15 million reduction due to the divestiture of the Dr. Comfort business unit[7]. - The adjusted EBITDA forecast for 2025 is now $395-405 million, up from the previous outlook of $392-402 million[7]. - Full-year adjusted earnings per share guidance was revised from $3.05-3.20 to $3.10-3.25[7]. - Enovis emphasized a focus on commercial execution, innovation, operational excellence, and financial discipline as strategic priorities for future growth[6]. Asset and Liability Changes - Total current assets increased to $1,280.1 million as of October 3, 2025, from $1,146.4 million as of December 31, 2024[29]. - Goodwill decreased to $1,218.7 million as of October 3, 2025, from $1,692.7 million as of December 31, 2024, indicating potential impairment[29]. - Cash and cash equivalents decreased to $33.6 million as of October 3, 2025, from $48.2 million at the beginning of the period[31]. - Total liabilities increased to $2,409.7 million as of October 3, 2025, compared to $2,154.4 million as of December 31, 2024[29]. - The company reported a total equity of $2,023.7 million as of October 3, 2025, down from $2,564.3 million as of December 31, 2024[29]. Impairment and Restructuring Charges - The company incurred a goodwill impairment charge of $548.4 million for the three months ended October 3, 2025, with total restructuring charges of $3.4 million during the same period[22][25]. - Strategic transaction costs related to the Lima Acquisition amounted to $9.2 million for the three months ended October 3, 2025, compared to $17.5 million for the same period in 2024[26]. - Enovis Corporation recognized $45.8 million for the net present value of royalty interest purchases, which will be paid over nine years, for the nine months ended October 3, 2025[26].

Core Insights - Enovis Corporation reported a third-quarter net sales of $549 million, reflecting a 9% increase on a reported basis and a 7% increase on an organic basis compared to the same quarter in 2024 [2][14] - The company experienced a net loss of $571 million, primarily due to a non-cash goodwill impairment charge of $548 million, which does not affect future operations [3][4] - Enovis updated its 2025 financial outlook, projecting revenue between $2.24 billion and $2.27 billion and adjusted EBITDA between $395 million and $405 million [5] Financial Performance - Third-quarter net sales reached $549 million, with Recon sales growing 12% and P&R sales growing 6% year-over-year [2][14] - The adjusted EBITDA for the third quarter was $95 million, representing a margin of 17.3% [3][12] - The adjusted net earnings per diluted share were reported at $0.75, while the net loss per share was $9.99 [4][20] Strategic Focus - The company is concentrating on commercial execution, innovation, operational excellence, and financial discipline to drive profitable growth [5][6] - Enovis completed the divestiture of its Diabetic Footcare business unit for total proceeds of up to $60 million, which contributed to the revenue reduction in the updated guidance [5][14] Market Position - Enovis is positioned as an innovation-driven medical technology growth company, focusing on enhancing patient outcomes and operational efficiency for healthcare providers [7][8] - The company aims to leverage its diversified growth platform to maintain momentum in new product introductions and stable end markets [2][14]

Core Insights - Enovis Corporation will host an investor conference call and live webcast to discuss its third quarter 2025 financial results on November 6, 2025, at 8:30 a.m. Eastern Time [1] - The company will also participate in upcoming investor conferences, including a fireside chat at the UBS Global Healthcare Conference on November 9 and at the Jefferies London Healthcare Conference on November 18 [5] Company Overview - Enovis Corporation is an innovation-driven medical technology growth company focused on developing clinically differentiated solutions that improve patient outcomes and transform workflows [3] - The company offers a wide range of products, services, and integrated technologies aimed at supporting active lifestyles, particularly in orthopedics [3] Investor Information - Investors can access the live webcast of the conference call via a link on the Enovis website, and a replay will be available later that day [2] - Enovis routinely announces material information through SEC filings, press releases, public conference calls, webcasts, and its Investor Relations website [4]

Core Viewpoint - Enovis has completed the divestiture of its foot care brand Dr. Comfort, marking a strategic shift to focus on its core business segments of "Prevention & Recovery" and "Reconstructive" [2][4]. Transaction Structure and Use of Funds - The total transaction amount for Dr. Comfort is up to $60 million, including a $45 million upfront payment and up to $15 million in milestone payments based on future performance [3]. - Proceeds from the sale will be used to accelerate debt reduction, improve profit margins by divesting low-margin businesses, and reinvest in high-growth segments [3]. Strategic Focus - Enovis is transitioning from a diversified industrial and medical device company to a focused medical technology firm, emphasizing technology differentiation and product optimization [4]. - The divested Dr. Comfort business was part of the Prevention & Recovery segment but did not align with the current focus on orthopedic rehabilitation [5]. Characteristics of Dr. Comfort - Dr. Comfort specializes in foot care products for diabetic patients and those with foot diseases, offering therapeutic footwear and accessories [7]. - Despite its brand recognition, Dr. Comfort's growth potential and profit structure are limited, especially compared to Enovis's focus on innovative medical solutions [7]. Core Retention - Enovis retains its "Prevention & Recovery" segment, which aligns more closely with modern orthopedic and rehabilitation practices, focusing on preoperative prevention and postoperative recovery [8][11]. - This segment emphasizes collaboration with healthcare professionals and has a higher contribution to overall business synergy and profitability compared to Dr. Comfort [11]. Growth Engine - Enovis is accelerating its "Reconstructive" business, which includes a recent acquisition of LimaCorporate, enhancing its capabilities in custom implants and 3D-printed products [13]. - The revenue from the reconstructive segment has reached approximately $1 billion, positioning it as a strategic investment priority for the company [13]. Summary of Strategic Decisions - The divestiture of Dr. Comfort, despite a lower transaction value compared to its acquisition price, signals Enovis's commitment to building a synergistic network between its prevention and reconstruction business lines [14].

Core Insights - Enovis Corporation has sold its Dr. Comfort diabetic shoe business to Promus Equity Partners for up to $60 million, which includes an upfront payment of $45 million and potential future payments of up to $15 million based on performance milestones [1][2]. Group 1: Transaction Details - The sale is seen as a positive outcome for Enovis, allowing the company to sharpen its focus on core strengths in Prevention & Recovery [2]. - The divestiture is part of a strategy to streamline the portfolio, enhance profitability, and accelerate debt reduction [2]. - Enovis plans to provide further strategic commentary on the transaction during its third quarter results call on November 6 [2]. Group 2: Company and Market Position - Enovis is described as an innovation-driven medical technology growth company dedicated to developing solutions that improve patient outcomes [4]. - The company emphasizes a culture of continuous improvement and innovation, with a focus on orthopedics and related fields [4]. - Promus Equity Partners, which manages approximately $2.7 billion, aims to support Dr. Comfort's growth and enhance its service to clinicians and patients [3].

Summary of Enovis Corporation Conference Call Company Overview - Enovis Corporation operates in the $4 billion prevention and recovery markets and is a growing player in the $40 billion global orthopedic implant market [1][2] - The company has built a strong portfolio across the orthopedics space, focusing on mobility and organic growth [2][3] Core Business Insights - Enovis has a recon business that is growing above market with strong gross margins, complemented by a prevention and recovery business that generates significant cash flow [2][3] - The company aims to enhance its balance sheet and focus on organic growth while integrating acquisitions made over the past four years [3][4] Strategic Focus Areas - The company emphasizes commercial execution and innovation pipeline as key areas for growth [3] - Financial discipline is a priority, with a focus on increasing free cash flow and reducing debt to enable future M&A opportunities [4] Market Trends and Demand - The macro trends of longevity, gut health, brain health, and mobility are seen as significant drivers for the company's growth [5] - Demand for hip and knee procedures remains strong, with the company performing well despite macroeconomic uncertainties [10][11] Product Development and Technology - The ARVIS® Augmented Reality System is viewed as a critical enabling technology for orthopedics, with plans for significant upgrades [17][18] - The company is exploring flexible pricing models for ARVIS® to drive market penetration [20] Financial Performance and Projections - The company anticipates continued improvements in cash flow generation, particularly in 2026, due to reduced regulatory spending and improved working capital efficiency [34][35] - CapEx is currently elevated due to integration efforts but is expected to normalize over the next few years [32][33] R&D and Innovation - Enovis aims to increase its R&D spending, currently at about 5-6% of revenue, to enhance innovation without sacrificing EBITDA [24][25] - The company views its M&A activities as a form of R&D, particularly in expanding its foot and ankle portfolio [26][28] Tariff and Pricing Trends - The company has seen improvements in its tariff situation, which is expected to positively impact financial performance in 2025 [44][45] - Pricing trends in the recon business are slightly down on a like-for-like basis, but new innovations are expected to stabilize overall pricing [53] Long-term Business Strategy - Enovis believes in the importance of maintaining a connection between its prevention and recovery and recon businesses to support patient care throughout their mobility journey [61] Conclusion - Enovis Corporation is positioned for growth through strategic focus on innovation, financial discipline, and leveraging its strong portfolio in the orthopedic market, while navigating macroeconomic challenges and enhancing operational efficiencies [5][34][61]