Surgery Partners, Inc. (NASDAQ:SGRY) Q4 2023 Earnings Call Transcript

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Ben Hendrix: Hey, guys, thanks for squeezing me in. Just a quick question. We’re hearing a lot of momentum on the medtech side about the robotics geared towards the shoulder opportunity. Just wanted to see kind of how that factors into your CapEx plans for the next couple of years. And kind of, in general, how you’re thinking about CapEx as we kind of look towards the $140 million to $160 million in the $200 million for 2025? Thanks.

Wayne DeVeydt: Eric, do you want to highlight how you’re seeing the robotics continue to evolve, and then Dave, provide a little clarity around the numbers?

Eric Evans: Sure. Yeah, happy to. We’ve grown our robotics portfolio a lot. We’ve added quite a few in 2023. We’re at nearly 50 robots. I would say this that related just to shoulders and ankles, there might be a little bit of demand for robotics. We have a lot of those well covered. I would also say that when we add robotics, to remind you, those are financed locally, so not a huge CapEx impact, and actually the ROI on those have been incredibly strong. And so, we agree with the medtech enthusiasm on the opportunity to continue to grow robotics in our facilities. We do that offensively though. So, you think about this, this is really to attract new opportunities and to go into new service lines, we’ll do that. It’s a little bit different than some of our peers who often are upgrading robotics just to kind of keep up with technology for the same book of business.

For us, it’s really a great offensive play, and we would share medtech’s enthusiasm on that. Dave, I don’t know if you want to add anything?

Dave Doherty: Yeah. I’ll just say one thing, right? What we’ve been able to kind of see on the procurement side of the world is a stronger partnership with very like-minded medtech suppliers out there, who see the same opportunity that we see. So, we’ve seen this since knees and hips came out, where they’re working with us to kind of capture this market shift. They see the growth in ASCs kind of following closely behind the availability of the right equipment. And so, you’re finding those favorable kind of financing or more opportunistic financing opportunities. Now, financing eventually will come around to paying cash, but for the most part, we only enter those if they’re properly asset-backed and the ROI is strong.

Ben Hendrix: Thank you.

Operator: Thank you. Ladies and gentlemen, that concludes our question-and-answer session. I’ll turn the floor back to Mr. Evans for final comments.

Eric Evans: Sure. Thank you. Before we wrap up, I would like to reiterate how proud I am of my colleagues and physician partners who collaborate to deliver on our mission to enhance patient quality of life through partnership. Their working contributions allow us to deliver consistent and predictable results and drive sustained growth for all of our stakeholders. Most importantly, they also continue to serve our communities with the highest clinical care in a low-cost setting with the convenience and professionalism all our facilities are known to provide. Thank you all for joining our call this morning, and have a great day.

Operator: Thank you. This concludes today’s conference call. You may disconnect your lines at this time. Thank you for your participation.

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