Enovis Corporation (NYSE:ENOV) Q3 2023 Earnings Call Transcript

Matt Trerotola: Yes, Jeff. Appreciate the question. We continue to be very confident in our leadership in shoulder. We’ve shown that leadership for a long time and we’ve been able to outgrow the market based on the great AltiVate shoulder and all the different innovation that we’ve been bringing through. And certainly, in the quarter, the 7% is more like in the neighborhood of market growth versus the above-market rate growth. It is normal. But then if you stack it on top of 17% last year, then you’d see kind of 2 years of comfortably above market growth. So we continue to be confident in our leadership there, even in a little bit more competitive field. We still have an advantaged product and a tremendous innovation pipeline.

Yes, we’ve got a couple of quarters of strong comps starting this quarter. And at the same time, we’ve got some really exciting innovations coming through as we work our way through the first half next year. So we feel comfortable that we’re going to continue to show consistent above-market growth in shoulder over the medium term here.

Jeff Johnson: And then you mentioned summer seasonality. I think that’s pretty consistent, I’m sorry, with everything we’ve heard from others as well. But I’m sure you don’t want to give month-by-month trends, but maybe just any thoughts on — from that summer seasonality, how September and now into October has trended. Are you seeing kind of some normalization of that seasonality and a recovery in volumes, just kind of your update on recent trendline.

Matt Trerotola: Yes, sure, Jeff. Yes. I mean, again, it’s sort of a new kind of summer seasonality setting last year with more vacations than normal as sort of the new normal, and that repeated itself this year, even probably a little bit — a little bit heavier in July this year than last year. So the first couple of months of the summer, definitely we’re slower. September was a good healthy step forward. And October is another good healthy step forward. And so we’re expecting sequential acceleration in Q4 versus Q3, and a pretty normal run to the finish for Recon as we head through the coming months that will set things up well for how things roll over into next year.

Operator: And we’ll take a question from Yang Li from Jefferies.

Yang Li: I guess to start, maybe I wanted to hear a little bit about the early feedback from your European team, Lima customers, Enovis customers on the deal. What do they like about it? Anything that they’re cautious of? In general, just how excited are they about the deal?

Matt Trerotola: Yes. Certainly, we’ve spent a lot of time getting out and getting feedback from customers and the channel in terms of that really important combination in our Recon business, and a lot of very positive feedback. I mean if you look at the Lima customers and channel, for example, here in the U.S., they’ve had kind of some limitations on how much breadth of product line they’ve had. They’ve had some great products, but they’ve had some limitations on how much breadth of product line they’ve had. And so that’s a great, real positive opportunity. Same goes for outside the U.S., Lima had some tremendous strengths in certain areas of the product line, but also has had some weaker areas that we will fill in very quickly.

And so again, the customers outside the U.S. and the channel outside the U.S. are excited about the opportunity. And on Enovis side, there’s some technologies that will come with Lima that our customers are quite excited about as well. So I’m very pleased by the feedback we’ve gotten from the marketplace. I’m really excited about the team, the time I’ve been able to spend with the Lima team and that other leaders have been spent — being able to spend with the Lima team. Just a lot of great talent there and a lot of excitement and energy about joining our company.