Conference Call Logistics Teleflex Incorporated Third Quarter 2025 Earnings Conference Call 11/6/2025 The release, accompanying slides, and replay webcast are available online at www.teleflex.com (click on Investors) An audio replay of the call will be available beginning at 11:00 am Eastern Time on November 6, 2025 either on the Teleflex website or by telephone. The call can be accessed by dialing 1 800 770 2030 (U.S.) or 1 609 800 9909 (all other locations). The confirmation code is 69028. Today's Speaker ...

Financial Performance - GAAP revenue for Q3 2025 was $913.0 million, representing a 19.4% increase compared to the prior year period[6] - Adjusted revenue for Q3 2025 was $892.9 million, up 16.8% year-over-year, and up 15.3% on an adjusted constant currency basis[6] - Consolidated adjusted revenue for the three months ended September 28, 2025, was $892.9 million, a 19.4% increase from $764.4 million in the prior year[49] - Consolidated revenue for the three months ended September 28, 2025, was $913.0 million, representing a 19.4% increase compared to $764.4 million in the same period last year[50] - For the nine months ended September 28, 2025, consolidated revenue was $2,394.6 million, a 6.3% increase from $2,251.9 million in the prior year[53][54] - The company reported a 6.3% increase in consolidated revenue for the nine months ended September 28, 2025, totaling $2,374.5 million[49] Earnings and Margins - Adjusted diluted EPS from continuing operations for Q3 2025 was $3.67, compared to $3.49 in the prior year period[6] - Adjusted gross margin improved to 57.3% for the three months ended September 28, 2025, compared to 60.8% in the same period last year[51][52] - The adjusted operating margin for the nine months ended September 28, 2025, was 24.9%, compared to 26.9% in the same period last year[53][54] - The effective income tax rate for the three months ended September 28, 2025, was 6.8%[51] Guidance and Projections - The company narrowed its full year 2025 GAAP revenue growth guidance to a range of 9.10% to 9.60%[6] - The company lowered its full year 2025 adjusted constant currency revenue growth guidance to 6.90% to 7.40%[6] Impairments and Charges - A non-cash goodwill impairment charge of $403.9 million was recognized for the Interventional Urology North America reporting unit due to market deterioration[20] - A non-cash impairment charge of $100 million was recognized for the Titan SGS asset group, driven by lower than expected sales growth[21] - The company recognized a goodwill impairment charge of $403,925 during the nine months ended September 28, 2025[70] - The company incurred restructuring charges of $117.6 million for the three months ended September 28, 2025, compared to $0.3 million in the same period of 2024[66] Segment Performance - EMEA segment reported revenue increased by 55.9% to $234.2 million, with an adjusted revenue of $214.1 million after a $20.1 million adjustment[49] - Americas segment revenue for the nine months ended September 28, 2025, was $1,557.3 million, reflecting a 2.1% increase from $1,525.5 million in the prior year[49] - EMEA segment adjusted revenue for the nine months ended September 28, 2025, was $531.5 million, a 20.7% increase compared to $456.9 million in the prior year[49] - The Interventional product category saw significant growth, with reported revenue of $266.4 million, a 77.8% increase from $149.9 million year-over-year[50] - The company experienced a decline in the Interventional Urology category, with revenue decreasing by 13.9% to $71.8 million from $83.4 million year-over-year[50] - The Other product category reported a 44.4% increase in revenue to $79.1 million, driven by adjustments related to the Italian payback measure[50] Cash Flow and Investments - Net cash provided by operating activities from continuing operations was $188,971, a decrease from $435,624 in the prior year[70] - Total cash used in investing activities from continuing operations was $826,782, significantly higher than $76,270 in the previous year[70] - Proceeds from new borrowings amounted to $1,140,000, compared to $130,000 in the same period last year[70] - The company repurchased common stock totaling $300,000, up from $200,000 in the prior year[70] - Cash, cash equivalents, and restricted cash equivalents at the end of the period were $381,310, an increase from $277,765 at the end of the previous year[70] Strategic Actions - The company continues to actively advance the process of a potential sale of NewCo, which has become a primary focus[5] - The integration plan for the Vascular Intervention Business is expected to incur restructuring costs of $36 to $44 million, with annual pre-tax savings projected at $24 million to $30 million once fully implemented[22][23] - The company is undergoing strategic actions to separate into RemainCo and NewCo, incurring direct costs related to consulting and legal services[39] Research and Development - Research and development expenses increased to $57.2 million for the three months ended September 28, 2025, up from $38.7 million in the same period of 2024, indicating a focus on innovation[66]

Core Insights - Teleflex Incorporated reported strong financial results for Q3 2025, with adjusted operating margin and earnings per share exceeding expectations, despite lower order rates in the intra-aortic balloon pump portfolio [2][7] - The company is focused on advancing its value creation strategy, including the separation into two entities, RemainCo and NewCo, and is actively pursuing a potential sale of NewCo [2][9] - The company has narrowed its revenue growth guidance for 2025, reflecting adjustments related to the Italian payback measure and lower-than-expected order rates [9][10] Financial Performance - Q3 2025 GAAP revenue was $913.0 million, a 19.4% increase from the prior year, while adjusted revenue was $892.9 million, up 16.8% [7][8] - The Americas segment reported revenue of $555.9 million, a 7.8% increase, while EMEA saw a significant growth of 55.9% to $234.2 million [4][5] - Adjusted diluted EPS from continuing operations was $3.67, compared to $3.49 in the prior year [7][8] Revenue by Segment - For the three months ended September 28, 2025: - Americas: $555.9 million (7.8% growth) - EMEA: $234.2 million (55.9% growth) - Asia: $122.9 million (25.0% growth) [4][5] - For the nine months ended September 28, 2025: - Americas: $1,557.3 million (2.1% growth) - EMEA: $551.6 million (20.7% growth) - Asia: $285.7 million (6.0% growth) [4][5] Revenue by Product Category - For the three months ended September 28, 2025: - Vascular Access: $191.0 million (5.6% growth) - Interventional: $266.4 million (77.8% growth) - Anesthesia: $101.4 million (0.3% growth) - Surgical: $122.9 million (10.0% growth) [6][8] - For the nine months ended September 28, 2025: - Vascular Access: $558.9 million (2.9% growth) - Interventional: $574.0 million (34.8% growth) - Anesthesia: $284.4 million (5.2% decline) [6][8] Guidance and Outlook - The company narrowed its full-year 2025 GAAP revenue growth outlook to a range of 9.10% to 9.60% and adjusted constant currency revenue growth outlook to 6.90% to 7.40% [9][10] - The GAAP diluted EPS from continuing operations guidance was lowered to a range of $(4.42) to $(4.22) [10][12] Impairment Charges - Teleflex recognized a non-cash goodwill impairment charge of $403.9 million for its Interventional Urology North America reporting unit due to deteriorating market conditions [15][16] - Additionally, a non-cash impairment charge of $100 million was recognized for the Titan SGS asset group, driven by lower-than-expected sales growth [17][18] Integration and Restructuring - The company commenced a restructuring plan related to the integration of the Vascular Intervention Business, with estimated costs of $36 to $44 million and expected annual pre-tax savings of $24 million to $30 million once fully implemented [18][19]

Core Points - Teleflex Incorporated will host a conference call on November 6, 2025, at 8:00 a.m. Eastern Time to discuss its third quarter financial results and provide an operational update [1] - An audio replay of the call will be available starting at 11:00 a.m. Eastern Time on the same day [2] - A virtual meeting regarding the recent Vascular Intervention business acquisition will take place on November 14, 2025, at 8:00 a.m. Eastern Time [3] Company Overview - Teleflex is a global provider of medical technologies focused on improving health and quality of life [4] - The company aims to be the most trusted partner in healthcare, offering a diverse portfolio in various therapy areas including anesthesia, emergency medicine, interventional cardiology, and more [4] - Teleflex is associated with several trusted brands such as Arrow™, Barrigel™, and UroLift™, which are united by a common purpose [5]

Market Overview - U.S. stock futures experienced a slight decline early on October 7, 2025, following a strong rally that pushed the S&P 500 and Nasdaq to record highs [6][20] - The pullback comes after a four-week winning streak, as investors consider extended valuations, political gridlock in Washington, and the potential for a near-term Federal Reserve rate cut [7][19] Technology Sector - Tech stocks are in the spotlight, with AMD shares surging over 25% due to a significant AI chip partnership with OpenAI [3][20] - Tesla's stock rose more than 5% on excitement surrounding its latest self-driving update and hints of a Model Y refresh [3][20] Commodities - Gold prices reached record levels, with spot gold hitting $3,962.63 per ounce and futures touching $3,985.30 per ounce, driven by safe-haven demand amid policy uncertainty [4][18] - The 10-year Treasury yield increased to 4.16%, indicating persistent inflation and cautious optimism [4][16] Market Sentiment - Analysts describe the market as upbeat but fragile, with rising hopes for rate cuts, although valuations appear stretched [4][20] - Key themes for the week include the impact of the Federal Reserve's commentary, effects of the government shutdown, upcoming earnings season, and concerns over high tech valuations [19][20] Premarket Activity - Leading premarket gainers include AMD (+37.49%), Tesla (+0.60%), and several others, reflecting strong momentum and recent news [13][10] - Notable premarket losers include Revvity Inc (-9.86%) and Moody's Corporation (-6.03%), facing selling pressure due to negative news and earnings misses [17][14]

Core Insights - The article compares Teleflex (TFX) and Penumbra (PEN) to determine which stock is more attractive to value investors [1] Valuation Metrics - Teleflex has a forward P/E ratio of 8.70, while Penumbra has a significantly higher forward P/E of 69.12 [5] - Teleflex's PEG ratio is 1.71, indicating a more favorable valuation compared to Penumbra's PEG ratio of 2.29 [5] - Teleflex's P/B ratio stands at 1.27, whereas Penumbra's P/B ratio is much higher at 7.66 [6] Zacks Rank and Earnings Outlook - Teleflex currently holds a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while Penumbra has a Zacks Rank of 3 (Hold) [3] - The Zacks Rank emphasizes stocks with positive revisions to earnings estimates, which favors Teleflex [3][7] Value Grades - Based on various valuation metrics, Teleflex has a Value grade of A, while Penumbra has a Value grade of D [6]

Core Insights - The DUBSTENT DIABETES trial aims to evaluate a dual-device strategy for PCI in diabetic patients, combining drug-coated balloons and drug-eluting stents to address high stent failure rates in this population [2][3]. Group 1: Trial Overview - The trial will enroll 120 diabetic patients across high-volume centers in Ireland, comparing the combined approach to single-device strategies [3]. - The primary endpoint is percentage diameter stenosis at six months, with secondary endpoints including death, myocardial infarction, and quality of life assessed over five years [4]. Group 2: Company Commitment - Teleflex is committed to advancing evidence-based solutions for complex patient populations and supports the DUBSTENT DIABETES trial to potentially shape future treatment strategies for diabetic patients undergoing PCI [5].

Group 1 - The event is the Morgan Stanley Global Healthcare Conference, specifically on Day 2 [1] - Patrick Wood, MD of Equity Research, is leading the presentation [1] - Liam, the CEO of Teleflex, is participating in the conference [2]

Summary of Teleflex Conference Call Company Overview - **Company**: Teleflex - **Industry**: MedTech, specifically focusing on vascular and interventional products Key Points Business Reorganization and Separation - Teleflex is undergoing a strategic reorganization, planning to separate its business into SpinCo and RemainCo, with a focus on maximizing shareholder value [3][5] - The separation process is anticipated to be completed by mid-2026, whether through a spin-off or a sale [7][9] - There is significant inbound interest in the assets, with a majority of interest in the entirety of NewCo [6][7] Financial Strategy - Proceeds from a potential sale will be used to pay down debt and return capital to shareholders [9] - The company has established a data room and management teams for the separation process [4][5] Integration of BioTronic Vascular Business - The integration of BioTronic's vascular business is progressing well, with strong collaboration between teams [10][11] - Expected revenue contribution from BioTronic is over $200 million in the second half of the year, with $99 million in Q3 [12][47] - Positive sentiment among employees from both companies, with no significant attrition reported [13][14] Market Opportunities and Product Synergies - The combined market for the vascular business is estimated at $10 billion, with significant product and geographic synergies identified [16][19] - Specific product synergies include the use of Ringer and PK Papyrus for addressing emergency events in procedures, representing a $120 million market opportunity [17][18] - The integration is expected to enhance access to cath labs and improve sales effectiveness [19][22] Growth Projections - Teleflex anticipates a growth rate of approximately 6% for RemainCo, driven by innovation and market expansion [38][39] - The interventional business is expected to perform well, particularly with the introduction of new products and recovery from previous market challenges [46][47] Challenges and Market Dynamics - The company is navigating challenges in the BPH market due to past reimbursement changes, but recent proposed rules are encouraging for UroLift [67][69] - The impact of volume-based procurement in China is expected to be transitory, with the company having successfully navigated through this phase [54][57] Innovation and Future Products - Teleflex is focused on innovative products like Freesolve, a bioresorbable scaffold, which is currently undergoing clinical trials [28][32] - The company plans to hold an Investor Day to showcase BioTronic assets and innovations to the investment community [35] Operational Focus - The management emphasizes the importance of executing the separation, integrating BioTronic, and maintaining operational performance as key priorities [73][76] Additional Insights - The company is optimistic about the future growth of its vascular and interventional segments, leveraging synergies from the BioTronic acquisition and focusing on innovative product development [20][72] - The management team is actively engaging with stakeholders to ensure a smooth transition and capitalize on market opportunities [4][5][76]

Core Viewpoint - The article emphasizes the importance of value investing and highlights Teleflex (TFX) as a strong value stock based on various valuation metrics and its earnings outlook [2][3][8]. Valuation Metrics - Teleflex has a PEG ratio of 1.69, which is lower than the industry average of 2.35, indicating potential undervaluation [4]. - The P/B ratio for Teleflex is 1.33, significantly lower than the industry average of 3.67, suggesting an attractive valuation [5]. - Teleflex's P/S ratio stands at 1.88, compared to the industry's average of 2.73, reinforcing its undervalued status [6]. - The P/CF ratio for Teleflex is 7.96, well below the industry average of 21.07, indicating a solid cash outlook and potential undervaluation [7]. Investment Outlook - The combination of Teleflex's strong valuation metrics and positive earnings outlook positions it as an impressive value stock in the current market [8].