Core Insights - Envista's shares have declined approximately 18.2% since the last earnings report, underperforming the S&P 500 [1] - The company reported a fourth-quarter adjusted EPS of 24 cents, a 17.2% decrease year-over-year, but exceeded the Zacks Consensus Estimate by 4.3% [2] - Full-year adjusted EPS was 73 cents, reflecting a 52.3% decrease from the previous year [3] Revenue Performance - Fourth-quarter revenues reached $652.9 million, a 1.1% increase year-over-year, surpassing the Zacks Consensus Estimate by the same percentage [4] - Full-year revenues totaled $2.51 billion, down 2.2% from the previous year [4] - Specialty Products & Technologies segment revenues were $410.9 million, down 1.2% year-over-year, while Equipment & Consumables segment revenues increased by 5.3% to $242 million [5] Operational Metrics - Gross profit for the quarter rose 10.8% year-over-year to $372.5 million, with a gross margin expansion of 498 basis points to 57.1% due to a 9.4% decline in cost of sales [6] - Selling, general and administrative expenses increased by 15.2% to $299.7 million, while research and development expenses rose 32.2% to $26.7 million [6] - Operating profit fell 17.4% year-over-year to $46.1 million, with an operating margin contraction of 158 basis points to 7.1% [6] Financial Position - At the end of Q4 2024, cash and cash equivalents stood at $1.07 billion, up from $940 million at the end of 2023 [7] - Long-term debt decreased to $1.28 billion from $1.40 billion year-over-year [7] - Year-to-date net cash provided by operating activities was $336.5 million, compared to $275.7 million a year ago [7] Future Guidance - For 2025, Envista anticipates core sales growth between 1% and 3% and adjusted EBITDA margins around 14% [8] - The Zacks Consensus Estimate for 2025 revenues is $2.56 billion, indicating a 2.1% increase from the previous year [9] - Adjusted EPS for 2025 is expected to be in the range of $0.95 to $1.05, with the Zacks Consensus Estimate at $1.10 [9] Estimate Trends - Recent estimates have shown a downward trend, with the consensus estimate shifting down by 16.52% [10] - Envista currently holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [12] Industry Comparison - Envista operates within the Zacks Medical - Products industry, where competitor Abbott has seen a 5.4% gain over the past month [13] - Abbott reported revenues of $10.97 billion for the last quarter, reflecting a year-over-year increase of 7.2% [13]

Core Insights - Envista Holdings Corporation's Smile Project contributed $1.8 million in 2024 to enhance oral health accessibility for underserved communities, totaling over $4.2 million since its inception in 2021, impacting approximately 32,000 individuals globally [1][2] Group 1: Envista Smile Project - The Smile Project aims to improve oral health in disadvantaged communities by increasing access to oral care and education [2] - The project collaborates with dental professionals and Envista employee volunteers to provide products, treatment, and education [2] - In 2024, the project supplied free dental care to over 787 patients in the Dominican Republic and donated goods to clinics serving more than 5,600 patients [4] Group 2: Company Overview - Envista is a global family of over 30 dental brands, including Nobel Biocare and Ormco, focused on improving lives through dental care [3] - The company offers a comprehensive portfolio of dental products, including implants, orthodontics, and digital imaging technologies, addressing various clinical needs [3] - Envista is recognized as one of the largest global dental products companies, holding significant market positions in attractive segments of the dental industry [3]

Distribution and Sales - In 2024, approximately 42% of the company's products were distributed through third-party distributors[51]. - Henry Schein, Inc. accounted for about 10% of the company's sales in both 2024 and 2023, and 11% in 2022[52]. - Sales decreased by 2.2% for the year ended December 31, 2024, with core sales down 1.5% compared to 2023, impacted by foreign currency exchange rates reducing sales by 0.7%[264]. - Total sales for 2024 were $2,510.6 million, a decrease of 2.2% compared to $2,566.5 million in 2023[270]. - Total sales growth for the year ended December 31, 2024 decreased by 3.2% compared to 2023, with core sales growth down by 2.6%[291]. Employee Engagement and Diversity - In 2024, the company achieved a 94% participation rate in employee engagement surveys, with 72% of respondents feeling engaged at work[62]. - The company maintained 99% gender pay equity and 100% race/ethnicity pay equity in the U.S. as of February 2024[59]. - The company employs around 12,300 individuals, with approximately 3,000 in the U.S. and 9,300 outside the U.S.[57]. Research and Development - The company plans to continue significant investments in R&D to maintain its competitive position and enter new markets[55]. - The company is focusing on product development and innovation, particularly in the Implant-Based Tooth Replacement and Orthodontic Solutions businesses, to drive growth[251]. - Continued investment in the Spark clear aligner system has led to increased manufacturing capacity and market adoption, expected to provide growth opportunities[253]. Financial Performance - Gross profit margin decreased to 54.7% in 2024 from 56.1% in 2023, primarily due to unfavorable product mix and impairment of long-lived assets[273]. - SG&A expenses increased to $1,158.0 million in 2024, representing 46.1% of sales, up from 41.2% in 2023[274]. - Operating profit for the Specialty Products & Technologies segment was $89.9 million in 2024, down from $232.1 million in 2023, with an operating profit margin of 5.6%[284]. - Interest expense decreased to $46.4 million in 2024 from $63.4 million in 2023, attributed to higher returns on cash and lower variable rate borrowings[280]. - The effective tax rate for 2024 was (3.1)%, a significant change from (82.5)% in 2023, mainly due to larger nondeductible impairment charges[282]. Acquisitions and Investments - The company is evaluating potential investments and acquisitions to strategically fit or expand its portfolio into new business areas[94]. - The company acquired Osteogenics Biomedical Inc., Allotech LLC, and OBI Biologics, Inc. on July 5, 2022, enhancing its Specialty Products & Technologies segment[95]. - The acquisition of Carestream Dental's intraoral scanner business was completed on April 20, 2022, which is part of the Equipment & Consumables segment[96]. Regulatory Compliance - The company’s manufacturing operations are subject to extensive government regulations, including those from the FDA for medical devices[68]. - The company is subject to various healthcare laws, including the Federal Anti-Kickback Statute and HIPAA, which regulate fraud, abuse, and the privacy of health information[77][78]. - The company must comply with the General Data Protection Regulation (GDPR), which imposes fines of up to €20 million or 4% of total worldwide annual turnover for non-compliance[88]. - The Personal Information Protection Act (PIPL) in China carries maximum penalties of CNY 50 million or 5% of annual revenue for violations related to personal data processing[89]. Economic and Market Conditions - The company faces challenges from global economic conditions, including inflation and supply chain disruptions, which can affect dental procedure utilization rates[247]. - Third-party payors are increasingly reducing reimbursements for medical products, which could impact dentist usage and patient demand[82]. - Sales volume was negatively impacted by lower demand in Europe, China, and North America, partially offset by strong demand in Russia[272]. Cash Flow and Debt Management - Net cash provided by operating activities was $336.5 million in 2024, an increase from $275.7 million in 2023, attributed to improved working capital management[297]. - Net cash used in investing activities decreased to $54.6 million in 2024 from $62.4 million in 2023, mainly due to lower capital expenditures[299]. - Net cash used in financing activities was $103.7 million in 2024, compared to net cash provided of $118.9 million in 2023, primarily due to a $100.0 million repayment of the 2028 Term Loan[300]. - As of December 31, 2024, the company had $1,069.1 million in cash and cash equivalents, with $850.8 million held outside the United States[303]. - The company has the ability to incur an additional $750.0 million of indebtedness under its revolving credit facility as of December 31, 2024[302]. Impairments and Charges - Goodwill and intangible asset impairment for 2024 was $1,153.8 million, significantly higher than $258.3 million in 2023, driven by adverse macroeconomic factors[276]. - The company recorded a $960.5 million goodwill impairment charge due to the fair value of five out of eight reporting units not exceeding their carrying values[333]. - An impairment charge of $101.1 million was recorded for certain indefinite-lived trade names within the Specialty Products & Technologies segment as of June 28, 2024[334]. - An impairment of $92.2 million related to developed technology and customer relationships was recorded within the Equipment & Consumables segment as of June 28, 2024[338].

Envista Holdings Corporation (NVST) reported fourth-quarter 2024 adjusted earnings per share (EPS) of 24 cents, down 17.2% year over year. The bottom line surpassed the Zacks Consensus Estimate by 4.3%.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.The adjustments include non-cash charges related to the amortization of acquisition-related and other intangible assets, restructuring costs and asset impairments, among others.The company’s GAAP EPS was 1 cent compared with the year-ago q ...

Financial Data and Key Metrics Changes - In Q4 2024, the company reported sales of $653 million, with core sales increasing by 2% after adjusting for currency impacts [23][24] - Adjusted EBITDA margin for Q4 was 13.9%, a decrease of 170 basis points year-over-year, while adjusted gross margin improved to 57.2%, up nearly 500 basis points [25][26] - Free cash flow for the full year reached $303 million, a 35% increase compared to 2023 [11][40] Business Line Data and Key Metrics Changes - The Specialty Products & Technologies segment saw a slight decline of 40 basis points in core revenue, with orthodontics impacted by a 50% decline in China due to VBP preparations [33][34] - The Equipment & Consumables segment experienced a 6.4% increase in core sales, driven by a low prior year comparable for dental consumables [37][38] - Spark continued to show strong growth, achieving double-digit growth in 2024, excluding the net impact from revenue deferral [15][24] Market Data and Key Metrics Changes - The global dental market was flat to slightly up, with implants growing low single-digits, while diagnostics declined mid single-digits [19][20] - The orthodontics market faced challenges, particularly in China, where brackets and wires saw a significant decline [20][21] - The consumables sector remained flat to slightly positive, with stable channel inventories and high service levels [21] Company Strategy and Development Direction - The company is focusing on three areas: growth, operations, and people, with investments aimed at high-margin businesses like Nobel Biocare [13][14] - A restructuring initiative is expected to generate approximately $20 million in annualized savings, supporting the share repurchase program of up to $250 million over the next two years [12][48] - The company aims to maintain core growth of 1% to 3% and an adjusted EBITDA margin of around 14% for 2025, with a new EPS guidance of $0.95 to $1.05 per share [11][44] Management's Comments on Operating Environment and Future Outlook - Management noted that while the dental market remains stable, there is no strong evidence of an uptick in demand, with macroeconomic uncertainties persisting [50][51] - The company expects the diagnostics market to improve slightly in 2025, but guidance assumes flat conditions compared to 2024 [95][96] - Management expressed confidence in the growth trajectory of the implant business, supported by recent investments and leadership changes [72][74] Other Important Information - The company has refreshed its leadership team and made significant investments in employee engagement and talent development [18] - The company is actively working on new product launches, including advancements in diagnostic equipment and the Spark platform [110][111] Q&A Session Summary Question: Can you talk about potential upside and risks to the 2025 guidance? - Management highlighted Spark's growth, implant business momentum, and potential recovery in diagnostics as areas for upside, while macro uncertainties and currency fluctuations pose risks [60][69] Question: What are the expectations for the implant business moving forward? - Management expressed optimism about the implant business, noting positive growth in Q4 and ongoing investments in commercialization and innovation [72][74] Question: How does the company view the diagnostics market? - The diagnostics business is expected to improve slightly, with management anticipating flat to low single-digit growth in 2025, driven by exiting unprofitable geographies [95][96] Question: What is the company's strategy regarding tariffs and supply chain? - The company maintains a flexible supply chain strategy to mitigate tariff impacts, sourcing materials locally and manufacturing across multiple regions [136][138] Question: Can you provide insights on Spark's profitability and its impact on margins? - Spark is projected to become profitable in the second half of 2025, with each point of margin improvement contributing to overall company performance [90][91]

Envista Fourth Quarter 2024 – Earnings Presentation February 5, 2024 Forward Looking Statements Certain statements included or incorporated by reference in this presentation are "forward-looking statements" within the meaning of the U.S. federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of revenue, expenses, profit, profit margins, tax rates, tax provisions, cash flows, pension and ...

For the quarter ended December 2024, Envista (NVST) reported revenue of $652.9 million, up 1.1% over the same period last year. EPS came in at $0.24, compared to $0.29 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $645.87 million, representing a surprise of +1.09%. The company delivered an EPS surprise of +4.35%, with the consensus EPS estimate being $0.23.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how th ...

Group 1: Earnings Performance - Envista reported quarterly earnings of $0.24 per share, exceeding the Zacks Consensus Estimate of $0.23 per share, but down from $0.29 per share a year ago, representing an earnings surprise of 4.35% [1] - The company posted revenues of $652.9 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 1.09%, compared to $645.6 million in the same quarter last year [2] - Over the last four quarters, Envista has surpassed consensus EPS estimates two times and topped consensus revenue estimates twice [2] Group 2: Stock Performance and Outlook - Envista shares have increased approximately 4.4% since the beginning of the year, outperforming the S&P 500's gain of 2.7% [3] - The company's earnings outlook, including current consensus earnings expectations for upcoming quarters, will be crucial for investors [4] - The current consensus EPS estimate for the coming quarter is $0.25 on revenues of $628.94 million, and for the current fiscal year, it is $1.13 on revenues of $2.56 billion [7] Group 3: Industry Context - The Medical - Products industry, to which Envista belongs, is currently ranked in the bottom 46% of over 250 Zacks industries, indicating potential challenges [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Envista's stock performance [5][6]

Financial Performance - Q4 2024 net income was $1 million, a significant improvement from a net loss of $217 million in Q4 2023[5] - Adjusted EBITDA for Q4 2024 was $91 million, with an adjusted EBITDA margin of 13.9%, consistent with expectations[8] - Sales for Q4 2024 reached $653 million, reflecting a core sales increase of 2.0% compared to Q4 2023[8] - Operating cash flow for Q4 2024 was $132 million, representing a 30% increase year-over-year, while free cash flow was $124 million, up 24%[8] - The company expects core sales growth of 1% to 3% and adjusted EBITDA margins of approximately 14% for the full year 2025[9] - Adjusted earnings per share for 2025 are projected to range between $0.95 and $1.05[9] - The company reported a gross profit of $372.5 million for Q4 2024, compared to $335.9 million in Q4 2023[15] - Adjusted net income for the year ended December 31, 2024, was $126.5 million, down from $269.2 million in 2023[23] - Gross profit for the year ended December 31, 2024, was $1,372.7 million, a decrease of 4.7% from $1,440.5 million in 2023[23] - Adjusted EBITDA for the year ended December 31, 2024, was $296.1 million, down from $464.2 million in 2023[23] Cash Flow and Assets - The ending balance of cash and cash equivalents increased to $1,069.1 million in 2024 from $940.0 million in 2023[21] - Operating cash flow increased to $336.5 million in 2024 from $275.7 million in 2023, representing a 22% increase[20] - Free Cash Flow for the three months ended December 31, 2024, was $123.9 million, an increase from $99.9 million in the same period of 2023[33] - Total assets decreased to $5.35 billion as of December 31, 2024, down from $6.61 billion a year earlier[18] Segment Performance - Specialty Products & Technologies segment reported sales of $1,616.4 million for the year, down 1.6% from $1,642.4 million in 2023[25] - Equipment & Consumables segment sales decreased to $894.2 million in 2024 from $924.1 million in 2023, a decline of 3.2%[25] - Adjusted Operating Profit for the Equipment & Consumables segment for the three months ended December 31, 2024, was $60.9 million, an increase from $44.7 million in the same period of 2023, reflecting a growth of 36.2%[27] Losses and Equity - Net loss for the year ended December 31, 2024, was $1,118.6 million compared to a loss of $100.2 million in 2023[20] - The company reported an operating loss of $1,038.2 million for the year ended December 31, 2024, compared to a profit of $31.5 million in 2023[23] - The company’s total stockholders' equity was $2.93 billion as of December 31, 2024, compared to $4.17 billion at the end of 2023[18] - The company reported a net loss of $1.2 million for the three months ended December 31, 2024, compared to a net loss of $217.4 million in the same period of 2023[28] Adjusted Metrics and Non-GAAP Measures - Adjusted EBITDA is used as a supplemental measure for assessing operating performance, excluding interest, taxes, depreciation, amortization, and unusual losses or gains, to provide a clearer view of operational factors[37] - Free Cash Flow (FCF) is utilized to evaluate the company's ability to generate cash for business growth and acquisitions, although it does not account for debt service requirements[39] - Adjusted Diluted Shares Outstanding includes the dilutive impact of stock options and performance stock units, reflecting the adjusted net income compared to a net loss under GAAP[39] - The company excludes amortization of acquisition-related intangible assets from non-GAAP measures to facilitate consistent comparisons of operating results over time[39] - Core sales exclude the effects of acquisitions, divested product lines, discontinued products, and currency translation to provide a clearer view of ongoing operations[39] - Adjusted Gross Profit, Adjusted Operating Profit, and Adjusted Net Income are assessed to understand long-term profitability trends and compare performance with peers[37] - Management uses non-GAAP measures to evaluate the company's operating and financial performance, providing insights into underlying business trends[38] - The adjustments made in the financial reporting are aimed at obscuring underlying business trends and making long-term performance comparisons more challenging[39] Quarterly Performance - Adjusted Operating Profit for the three months ended December 31, 2024, was $81.5 million, compared to $89.6 million for the same period in 2023, representing a decrease of 1.1%[27] - Adjusted Net Income for the three months ended December 31, 2024, was $41.1 million, down from $49.7 million in the same period of 2023, reflecting a decline of 17.5%[28] - Adjusted Diluted Earnings Per Share for the three months ended December 31, 2024, was $0.24, compared to $0.29 for the same period in 2023, a decrease of 17.2%[29] - Total sales growth for the three months ended December 31, 2024, was 1.1%, while core sales growth was 2.0%[32] - Adjusted EBITDA for the three months ended December 31, 2024, was $91.0 million, down from $100.5 million in the same period of 2023, a decrease of 14.1%[31] - Adjusted Operating Profit as a percentage of sales for the three months ended December 31, 2024, was 12.5%, compared to 13.9% for the same period in 2023[27] - The average common stock shares outstanding - diluted for the three months ended December 31, 2024, was 173.7 million, slightly up from 173.5 million in the same period of 2023[30]

BREA, Calif., Feb. 5, 2025 /PRNewswire/ -- Envista Holdings Corporation (NYSE: NVST) today announced results for the quarter ended December 31, 2024."In Q4 2024, Envista delivered results that were in line with expectations, indicating that our focus on growth, operations, and people is having a positive impact," said Paul Keel, Envista's CEO.  "2024 was a transition year for our company.  After a challenging first half, we took actions over the last two quarters to position ourselves for improved performan ...