Release Date: February 27, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: What prompted Teleflex to undergo a strategic review and decide on the current changes, including the acquisition and separation? A: Liam Kelly, Chairman, President, and CEO, explained that Teleflex continuously reviews its portfolio to optimize value for shareholders. The acquisition of Biotronik's vascular intervention business highlighted the distinct growth strategies and goals of two separate business entities within Teleflex, leading to the decision to separate them into independent companies. The separation is seen as a way to unlock shareholder value and align each business with its unique growth strategies and capital allocation priorities.
Q: How does Teleflex plan to integrate Biotronik's business, and what are the expected synergies? A: Liam Kelly noted that Biotronik's business is strong in EMEA, while Teleflex's interventional business is stronger in the Americas. The integration will allow Teleflex to leverage its existing channels to sell Biotronik's products, particularly in the cath lab. The acquisition will enable Teleflex to expand its presence in both coronary and peripheral interventions, with opportunities to combine sales forces and product portfolios for enhanced market reach.
Q: What are the financial expectations for the Biotronik acquisition, and how will it impact Teleflex's growth? A: Liam Kelly stated that the Biotronik acquisition is expected to generate approximately EUR91 million in revenues in Q4 2025, with a growth rate of 6% or better from 2026 onwards. The acquisition is expected to be accretive to adjusted earnings per share by $0.10 in the first year post-acquisition and increasingly accretive thereafter. The acquisition will also drive double-digit ROIC early in the fourth year following the close.
Q: What are the key challenges and expectations for Teleflex's 2025 guidance? A: Liam Kelly highlighted that the 2025 guidance reflects a challenging trading environment, with expected low-single-digit growth in the Americas and APAC, and mid-single-digit growth in EMEA. Key challenges include continued pressure on the UroLift business, tighter inventory management in the OEM segment, and volume-based procurement impacts in China. Despite these challenges, Teleflex remains confident in its ability to achieve 6% growth for RemainCo post-separation.
Q: What is the rationale behind the separation of RemainCo and NewCo, and how will it benefit shareholders? A: Liam Kelly explained that the separation will create two focused, independent companies, each with distinct growth strategies and capital allocation priorities. RemainCo will focus on high-growth, hospital-focused markets, while NewCo will leverage its established positions in urology, acute care, and OEM markets. The separation is expected to enhance strategic focus, improve resource allocation, and provide targeted investment opportunities for shareholders.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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