Patterson Companies, Inc. (NASDAQ:PDCO) Q2 2023 Earnings Call Transcript

And I think that’s our focus. And I think if you got into our — into our meetings, and some of the things we’re doing, you’d find it to be a more aggressive discussion, and then it may come across.

Jeffrey Johnson: Do you feel gone at all like, you are even more supportive of kind of that evolution of Patterson and where kind of dental distribution probably needs to go over the next 5 or 10 years, that maybe past leadership, is there any change that we should expect in your mentality or supportive kind of that? Again, what I think is needed evolution versus maybe past leadership?

Don Zurbay: Yes, I don’t — I wouldn’t want to stack myself up exactly. But I think when we look at our strategy, there’s a — we’re fully bought into the idea of we’re not just a distributor. I mean, when we talk about being an indispensable partner to our customers, that really is where we’re at and the best way to do that, and I think, is to really, how do you deepen the value proposition and I think we’re you can kind of see it’s starting to take hold and continue is on our margin performance, and how it’s impacting our margins. We’re really being diligent about how we look at each customer and kind of the holistic view of that, and those efforts are paying off quarter-after-quarter now on the margin expansion side.

Jeffrey Johnson: Yes. Understood. Appreciate the comment.

Operator: Your next question comes from the line of A.J. Rice from Credit Suisse. Your line is open.

A.J. Rice: Thanks. Hi, everyone. Just first question around the comments around PPE. It sounds like from here through the rest of the fiscal year, you’re thinking, you’ve also experienced inflationary pressure, but the order — the volumes are stabilized. Is that the right takeaway? And then on that deflationary aspect is that year-over-year, but sequentially pricing is stabilizing? Or is pricing on a sequential quarterly basis still coming down?

Don Zurbay: Yes, what we’re seeing is pricing is, is coming down sequentially. I think when we look at the volume implications, we think when all is said and done here, that volumes are going to be above pre-pandemic levels, but the pricing continues to moderate. And as we go — and we think that that should hopefully abate at the end of this fiscal year. The impact going forward is going to be that on a year-over-year compared — comparison, that’ll move into next year just because of the dynamics of how it’s declined this year. I don’t know, Kevin, if you want to add anything to that.

Kevin Barry: Yes, that’s right. It’s primarily a issue for us. And then like Don said, what we’ve seen is the pricing on those products has started to stabilize a bit. But because they are lower than they were a year ago, we’re going to have a comparison issue for the next couple of quarters here as we kind of work through that dynamic.