Craig Bijou: Okay, that’s helpful guys. And just to follow up specifically on what’s embedded in the EPS guidance. I just, I heard your comments too on EBITDA before, but I wanted to see, I mean my math it makes it look like it’s 29%, 30% EBITDA margin for ‘24. And then I also wanted to see if there’s any assumption of share buyback in your EPS guidance.
Keith Pfeil: The 29%, 30% I think makes a lot of sense. 140 million shares are what we projected for the year. And I leave it that.
Operator: And our next question comes from Caitlin Cronin from Canaccord.
Caitlin Cronin: Hi, thanks for taking the question. Just regarding your AR headset, any updates to the timing there? And secondly, what do you think of the current competition in that space and how is your product going to be competitive for these offerings?
Keith Pfeil: Caitlin, we expect our augmented reality headset, DXR to get out by mid -year based on everything that we’re tracking towards right now. I’m pretty excited to do that as well. Working to make sure that it really works seamlessly with some of our enabling tech activities as well to actually create a stronger offering out for the surgeons.
Operator: And our next question will come from the line of Richard Newitter from Truist.
Richard Newitter: Hi. Thanks for taking the questions. I was hoping just to go back to the comment that you made on, it sounds like going a little bit more heavy on offense on rep hiring and attrition. I think you had said something about, not hiring as many reps as normal in 2023, but then in the fourth quarter, you hired 350 reps or net reps. I guess just help me understand what those 350 means. What is that relative to a good quarter of net hiring and how we’re supposed to kind of interpret that relative to the dissynergies that are starting to unfold? Then I have a follow up.
Keith Pfeil: You got it, Rich. So let’s start this way. We’ve had great recruiting years and in 2023, I would tell you it was an okay recruiting year. The reason why it was an okay is we had all of our focus shifted into making this merger happen. So naturally your level of recruiting and your focus on recruiting wasn’t quite as heavy. Now it doesn’t mean it was dismal. I mean it was really not that different from the last five years, it just wasn’t the strongest or record year like we normally call out. I was being me when I was replying to the fact that we closed the deal in September and so Globus actually then inherited or took over through the merger roughly 350 sales reps from the new base of business. That was my comment.
Richard Newitter: Okay. Thanks. I figured there was something tongue in cheek there. Okay. And then, sorry, I just lost my train of thought for a second. And then wanted to also get a sense for what kind of information you’re going to provide on a go forward basis. What we’ve seen in the press release from here, this is the divisional breakout we’re going to see or is there going to be more historical that you provide on segment detail. How should we think about that? And one last one, just product rationalization. Has any of that effort begun?
Keith Pfeil: So thanks, Richard. This is Keith. So what we’ve put out there from a reporting perspective is what we’re going to continue to provide, break out of musculoskeletal and enabling as well as US versus international. We will continue to provide color each quarter about some of the businesses like we’ve always done historically. As it relates to product rationalization, that is not something we’ve really looked at this point. Some of my earlier comments focused on the need for us to listen to our customer. Right now, the thing that we’re focused on is bringing the salesforces together, listening to the surgeons, listening to the patient and really selling the products of both companies.
Daniel Scavilla: Yes, Rich, I would just add on that we don’t have planned rationalization. We thought that over time our surgeons and our customers will select what they want and will migrate towards that, but we don’t have a product rationalization in as a way to reach or achieve our synergies or anything in our financials.
Operator: And our next question will come from Andrew Ranieri from Morgan Stanley.
Andrew Ranieri: Hi guys. Thanks for taking the questions. Just to piggyback off of some that have been already asked, but on Richard’s last question about product rationalization, can you maybe just hit upon what you’re thinking about for free cash flow generation over the next two, three years into 2026 and just how investors should think about that? Cash generation I think was one of the kind of hallmarks of the deal when you initially proposed it. And then has anything changed about how you’re thinking about tracking or driving instrument set utilization between kind of the two, well, not the two companies anymore, but between legacy GMED, and NuVasive looking ahead and I had a follow-up.
Daniel Scavilla: Drew, I’ll go first. This is Dan, and I’ll hand it off to Keith with that. So just for clarity, in our cash flow or our estimates, we don’t have anything built in related to rationalization. So I just want to make sure we’re building off of riches. You agree we’re not pursuing a product rationalization. It’s not built into our finances that way. So we won’t have any effect financially or cash flow wise. However, we do have in place ways to utilize our field assets, our sets efficiently. We’ve been working on that and ever improving that through our Globus legacy, and we intend to do the same with our NuVasive team as we get in and get up to speed. What that’s going to allow us to do is get more surgeries, more turns, more output with those investments. Which, to your point, will generate a favorable cash flow by generating the sales, not having the current level of investment needed to get those sales.
Keith Pfeil: Yes, and a couple of comments that I’ll add to that is when you think about Globus, yes, we’re going to focus on driving the business and managing for cash. And as I think about that $170 million, that’s predominantly cash savings, which should translate into cash flows and move forward. That’s part one. Part two is really the control of CapEx. So if you go back and look and compare legacy Globus to NuVasive, you’ll see that legacy NuVasive carried CapEx that was probably closer to 8% or 9% of sales. Globus, give or take 6% or 7%. I commented on where we’re going to land this year in my prepared remarks. That is also going to help drive free cash flow generation, and it’s not going to impact our ability to invest in R&D. Really what it’s going to come back to from our perspective or from my perspective is better control of the assets and driving improved return on invested capital.
Andrew Ranieri: Got it. Thanks, and just a quick follow-up. Just anything on getting NuVasive products registered? And improved on Excelsius, looking ahead. Thanks for taking it.
Daniel Scavilla: Yes, definitely. That’s one of the key things. So of course, we’re going to be doing that and doing that in an ever-growing way, starting with the realign system. And then we’ll certainly look for endo bodies and different activities that way. That’s going to be one of the events we think by mid-year or within third quarter we should be capable of going and pushing forward on.
Operator: And with no further questions that concludes the Globus Medical Earnings Call. Thank you for participating. You may now disconnect. Everyone, have a great day.
