FNA - Earnings call 3 2023 | Paragon 28, Inc.

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Operator

Good afternoon, and welcome to Paragon 28's Third Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded for replay purposes.

And I would now like to hand the conference over to your host today, Mr. Matthew Brinkman, Senior Vice President of Strategy and Investor Relations. Mr. ahead. go please Brinkman,

Matt Brinckman

and thank Results joining on and DaCosta, Executive are and Financial Quarter today's XX's XXXX Albert Officer; Chief and Financial Earnings Chairman Deitsch, you afternoon, Chief Paragon Officer. for Third call Steve Good Call. Presenting

begin, meaning to remind Private I pursuant laws, are of make federal management you forward-looking include to like Act call of Reform harbor Litigation made the this securities Securities during that would provisions the statements we that will Before statements within of safe the which XXXX.

that intentions, to forward-looking Forward-looking differ to future or beliefs, statements estimates to events, those may made from statements of materially assumptions of are statements include the statements. cause as company's predictions actual number These or management's uncertainties, a hopes, results results forward-looking subject performance. or risks, expectations and

All Paragon are by and current XX as available to assumes update forward-looking information, required based except statements. these law, obligation, statements upon no

statements impact certain concerning filings risks information forward-looking that company's the the time and Additional from was that in SEC today. press and may time earlier in release to these is issued uncertainties contained

today. net During the growth. net will this the currency to financial A of is contained income growth presentation, revenue release adjusted financial constant earlier and reconciliation press refer measures to measure, GAAP issued most EBITDA reported comparable non-GAAP net we revenue and our in

will that, I now turn the with to And over call Albert.

Albert DaCosta

things further constant the and X our a we reported joining global credit of quarter. you from revenue growth on it XX% $XXX.X for will XXXX thank Matt. third followed kick for our currency things for overview call. and respectively. XXXX, an announced our million us financial to on to was representing months start financial Steve pass XXXX today update performance, I'll by new of our results, Good guidance. To review of and afternoon, growth, provide the over with XX% Thanks, I facility, an first off, improved details which and earnings Then, also our recent highlights off quarter

model balanced and well contributions X% continues growth subsegments. revenue of X foot with the business market our rate Our estimated to of meaningful the growth ankle from growth drive each above

quarter global and reported was constant representing comparison Third I growth chain this third the XXXX. million, disruption. to tough $XX.X growth very the XX% constant of revenue year XXXX pleased quarter XX% prior performance and compared currency am given currency short-term the supply with

U.S. drive that We continue continue to will on and execute have sustainable and strategies our growth. to strong

we to roster XXXX, U.S. to base by quarter XXX to surgeon sales customer customers. X,XXX X% while of XX% increasing of quarter our increased third our producing by the record almost compared During the a third XXXX,

nice of new opportunities customers, and also launches, additional sales launches with provide year-over-year growth with by We tandem the coming solid exciting sales Further, have in continue combined levels see driven from revenue several we producing leading surgeon which representatives in important happening the recent legacy in months U.S. execution force product will launches and both to education. gains and product medical

of quarter third as and important markets. increasingly we be both other by opportunity established the during excited XXXX, most the exceptionally well perform in as continue to continued our business markets we international Our to have

relevant foot and new our improve patient ultimately customers innovative help Our growth is market, to ability driven bring which surgeon by and to our ankle technologies outcomes.

this typically we different. be year, each and will to reminder, launch year As XX no a products X

the the GreatWhite System, Reinforce including the be depth date, launched several Plating Jaws pipeline and with Extraosseous our we've X next products projects Nightmastaple Metatarsal product Adaptive Supramalleolar in year, System, also and over Beast active continue few second Tape. and This products thrilled soft quality Corticofiber quarters Gorilla I Bone tissue development, to planned the XX Bridgeline and our about Web Repair system, of in the including System substantial beyond. launches Graft the Shortening and X Osteotome to with

following as and truly strategy ankle growth to foremost improve potential at that rapidly potential Smart we a than acceleration to believe have are start is executing and the market ankle we technologies and and exclusively gem. time, and potential estimated with closely it's driven patient on complications. our reduce ankle are the billion, first more current Today, we and GLP-X to foot that Finally, developments by outcomes. the market ankle for foot of X%, growing saying we global focused foot on, about and be market new business $X.X focused such levels At I'll foot ankle, XX by are the implications. same foot

We are to be great and our the come. in share market. positioned gains very the of well driver years expect we primary to in growth this

course, market, could ankle to impact, foot ultimately our market, our the ankle singular but is future benefit lifestyle more speculate passion Of it that any, on and if will leading which anything have and what a to focus. impossible and foot active GLP-Xs the is is view

experience of Our and also indicates in and and be better to tend med these active orthopedic candidates. typically patients are than more markets patients tech surgery younger foot that generally other ankle and less

So be our business. few quite to on a we market have and bullish reasons our

details topics on few the are supplement well as other Relations and Investor and Our we third website market, today. GLP-Xs discussing foot additional quarter regarding earnings ankle a as our includes

now it will over I that, to Steve. With turn

Stephen Deitsch

Thank quarter respectively. reported XX.X% currency XX.X% you, revenue growth, constant $XX.X Albert. year-over-year representing and XXXX in third Paragon XX's million, was

XXXX. second Our prior and growth U.S. quarter $X.X million, nice of $XX.X a quarter XX.X% representing year from sequential increase revenue over was of the million the

representing XX.X% revenue into than as a extent the international growth, million, continued but to expected, in year-over-year headwinds second experienced was lesser chain third and the quarter respectively. currency constant Supply in XXXX of those quarter. Our XX.X% reported $X.X

further continue XXXX. supply during We headwind diminish the quarter expect fourth to to chain of

a percentage profit the XX.X%. quarter by profit XX.X%. million the a a $X.X at EBITDA by to approximately $X.X margin year-to-date to X with loss. adjusted for in and quarter R&D operating investments It consistent of for increased XX.X% making million gross to have XXXX, quarter point throughout was XXXX EBITDA continued selling continued Adjusted million marketing our approximately last third quarterly resulting and Gross growth improved the leverage less improvements. profitability throughout year operating third expenses XX.X% XXXX, and was remained On in loss at inventory than basis, Despite improved margin due expense $XX reserves.

adjusted continue which basis operating expect to an beyond, and We beginning on drive profitability XXXX annual in EBITDA leverage and XXXX. fourth quarter believe the improve of to positive we will in

Now turning to cash flow.

are of million operating the use flow XXXX. cash cash breakeven approximately change primary XXXX cash and year-to-date compared for in operating X use. combined drivers to in approximately XXXX operating and $XXX There totaled Our XXXX both

of purchases normal $XX resulting due to operating inventory supply million been First, have disruptions temporary above stockpiling chain in our inventory. levels

$XX million legal made we full settlement of which paid payments, in were earlier this Second, nonrecurring year.

in EBITDA we million XXXX. Third, used items start and equaling loss tailwinds XXXX, operating these here's created of headwinds million cash a negative why. for X resulting of since $XXX growth These X of but adjusted million the made in cash beginning business, XXXX $XX Each become since believe of the XXXX. these flow items in important our and we start will temporal investments XXXX, of items importantly, flow $XX nearly in targeted the account together cash

XXXX With balances operating over levels to efficiency. and disruptions to continuing of abate, supply time, expect XXXX we return chain to our inventory

new planning has and are improvements material to great function enhanced and vendor and execution leadership committed efficiency tools drive in XXXX. and underway we close partners, Our team significant XXXX inventory resource members, plans operations as enter

and building to on continuing and important beyond, mentioned, of market rate. positive growth adjusted the EBITDA annual our previously the at quarters, we expect over XXXX momentum in as investments Finally, past growth several grow the business investments to last leveraging earnings multiples make

credit some and improved share our senior to like facility. on I'd Now new information

priced company's just including we close expands million Further, we $XX million, cash liquidity a under facility. $XX $XX transaction, importantly, is $XXX And drew our senior this as with The facility pro credit bringing Ares with previously as forma warrants. to such XX, previous facility to With pro equity new know, announced and you $XXX had similarly approximately available forma of September As by borrowings no XXXX. it sweeteners it's total senior credit million million. $XXX the drawn. of non-dilutive million million $XXX our million at today competitively with today,

breakeven, and beyond. XXXX level PXX's reinforces to this liquidity believe into continued pathway expected flow our improvements flow of given cash We and cash earnings in

Finally, continue topic, we to a we with on to rapidly this as thrilled business. high-quality are partner lender, Ares, as our grow such

business XXXX The prospects. turning and fundamentals and revenue is Now to confidence have and are our growth our great strong, indicators we leading positive our ankle in market foot guidance.

environment, revenue supply Our but accounts updated improving these environment. the XXXX continued also factors uncertain including for chain factors in the guidance macroeconomic

to million guidance XX% previous XX% year-over-year we XXXX, midpoint, of year constant revenue of full at are the and million. guidance net range our $XXX range reaffirming growth. this And implies reported currency For $XXX

remain translation net Our translation revenue rates rates. consistent currency also with guidance assumes foreign current

is of That remarks. our the end prepared

Operator

Instructions] [Operator Piper comes question with O'Brien first from Sandler. Our Matthew today

Matthew O'Brien

quarter. know starters, bump, not don't sequential the I of that this such especially and guess maybe getting for see result tough comp if impressive companies lot is Albert really but from a QX or I of the Steve, ortho to a we're

a improvements wrapping can of of take how And you that perspective the end I we didn't little some just into about chain what from just question, low kind you you you that guidance the productivity bit, in talk got up saw range of that supply just QX. guess, saw there? the So come a given here maybe

Albert DaCosta

great I'll take pleased to QX. tell yes. one, in on I were a you, and that to we start Matt, team's pretty got Yes. with performance our from Maybe hear

things year, beginning continue to in couple QX influence there I that's some I some improve the did year. think, started of rest product there supply this improvements the start us that increase launches and there. of of And We of we One the a to bit. in executing. sequential we're expecting last the that chain through is and call, a -- see had a year in in then just to think that it's saw to this the I to discussed that think you led

a well. been And launched Our medical in think those some I going education paying We things and of starting us execute has lab you're plan QX. to see mobile nicely. allowing second to off really

Stephen Deitsch

the very year third a also of third And we number a account fundamentals, better supply we quarter. with question, chain, record is reps our better. challenge et business Steve. just part look not cetera, second on balancing that but the sales it being customers of completely getting had the the that again, the the in in with and of fact the that number it's we're producing quarter It Matt, strong, including got through indicators, full into really Yes. at record the leading the taking took

into that to in expected account general range. And We taken get overall continue fourth and better get in but to quarter, -- environment the just macroeconomic uncertainty. forth the the low we've also

So range, and -- that potential environment. is the low also when the in kind think about worsening think any impacts the macroeconomic about of chain you supply

Matthew O'Brien

That's helpful. then it. is question, Got for And you. second probably Steve,

you facility, Just Ares specifically that's on step-up I a had the before. big from mean, what

bit don't or analogy breathing the but Just getting for the room. timeframe adjusted room next breakeven use talk get to little of that to specifically year. positive to about a that I kind EBITDA here, to the after is provides what flow right positive that, in the maybe know you cash breathing

Stephen Deitsch

a credit million that that from did in had reinforcement place. our it reasons. couple million a excited available of priced just competitively One, up $XX and we a It's agreement. to cash provides really from We're pathway to breakeven. of went for what of It's $XXX to We put we a before. Yes. flow step

as years. we we felt years a think And visibility we have business, we also is path to hope X and like last that the runway I absolutely gives actually ran we breakeven. flow. investors business agreement spent we in expect over gives over it's look we we've to settlement, just forward, cash as improve a that things Albert close it But it, reason even there augmenting also inventory finalized before, than the spent, backstop, as an a EBITDA but of and se. last that people in more per X reverse with the really for the potentially this on we losses believe our And feel to and particularly to our and cushion historically more cash invested I. aren't us clear those legal and We And this

Operator

Craig from comes of America. question Bank next Our Bijou with

Craig Bijou

very Congrats a tough on a on strong comp. quarter

up total business. of some So pretty been I your good maybe to start to business, only the bit less see. XX% there. it's wanted a with little I you've international strong but putting -- know growth

bit So Just and years. certain of strategy. your on foot Are maybe of Albert, markets, couple in the you talk And level share? the markets? for sustainable is color ankle Is a procedures little maybe how maybe taking there? expanding this about international opportunity it the next more growth

Albert DaCosta

Yes. Great were paying we was Craig, just the to this strong. I'd attention for the structure any some you, market, I'll we and of Being miss, maybe at international and the it on of anything color and really, as I'll when something to special variances vetting, was response and our Steve so preferences and first that generally designed style kits. hear take were well. from we But and a U.S. can you, the that stab tell specifically entered shed speaking, really

up like to XX entered influential confidence lot the in of set about have so And us us very the South It be forward. a first Africa gave of the we that international going that moving Paragon shown is countries very market.

significant the goal do means do powerful the what forward. that we're to you, is And moving the pretty On as styles doing every in And a day. we other the from investments something infrastructure, organization company. that need in bring made equation, and all I'll U.S.-only of ankle here we preferences tell over space can't side that foot our We the it that's and in and world. to some the

and single for kind opinion and what we each country best and separate every are, of determine way we the structure take environment start a also We feeling into key as going entity, to leaders who our is be country. that the

anything we should think with I we preconceived into structured. go be off. paying a on So don't notion how And that's

it is that in direction And the so us generally doing foot fulfilling our for mission thrilled this we're and perspective. global improve right speaking, I'll a tell ankle and outcomes you, one, to taking from towards

geographically us, it's and another Two, both a from diversity style for and a standpoint. piece and of even preference

third, lot there. really of about a for the think a there it's strong from well. continue as I piece for runway and then stronger continue expand still And us And thrilled So long we a that to that. is and us perspective, we're business see just building revenue opportunity to to

Stephen Deitsch

-- And internationally. And foot than global when Yes. at about add, just I even would at share $X less overall billion the and look Craig, ankle X% the you we're share, market that market. we're market our that in

that yield. extensive an have we So investments are made going runway to to and continue the we've

those in the work and businesses Australia where great U.K. larger thanks businesses right and it South ground. Africa, now, Our have honestly. in on the for we to or just the killing teams And

But it's teams getting just in. markets we're our really new that as also well in going

for very where that a had market big in markets, we been a of So of large vibrant before, we've and new runway markets, markets but forward. haven't just a lot us beachhead move as existing

Craig Bijou

have been shifting maybe market. of Very launching competitors products. new helpful. And to the talking number A U.S. about

competitive some in guys been but competitive. I view into or, just has of Obviously, products more gotten get landscape. new how competitive it I are to the of it's the globally? your versus guess, maybe Albert, U.S. your But some new the the of maybe -- on maybe would of are kind So you love that And positioned entrants, new out coming not market? thoughts always

Albert DaCosta

Sure. Well, love competition. you, for tell I'll starters, we

morning and our about to And hear goal we surgery. outcomes competition might the you think of each it foot our up much And behalf, in I I the feel we're these think of on about like these improve things and a going for ankle it's How the we our through all is that good kind better? our have, here challenge different we space. to some go when just, perspective, so we I feel proliferate we speaking, bed about, could And we procedures? thinking market. From But our own for continue have ankle. when we at is we enhance to care but in we our we that's mean, yet? this so makes wake from the are competitors same How right? thoughts can and night, the can support This can we how generally -- about our offering improve dinner, more and we not surgeons we the we How offering? are I exciting, us. foot in thing think entire What when other more speak think to think that I and is can care I way. about

for us know that's motivated. us, what I every us what It's drives day. keeps

unique that to And a and creates pretty a so moving There's feel to commitment will with that pretty has benefit research continue I Paragon. piece really It it that forward. our surgeons development sincerity look and in to to and positions I think is is to to better strategy our product. compete space, us this communications unique. well that think our And and us

add just every one to was of area it's One last key I thing -- most that kind just to going just about. they're -- piece And competitor I'll more yes, that. excited that has a there, add

the Paragon think the excited that's kind is I companies of entire really of footage one consistently market. about

different we question foot maybe competition ankle and of of so there's a of which pockets from just that address look depending And market competition your at. the standpoint, to on subsegment part is

Operator

B. Our next comes Riley. question from with Chatterji Neil Chatterji

Unknown Analyst

is This for on Anderson Neil.

any First, sales the in continued sales just third force for update could us expansion you And quarter? on XX? productivity plans force into

Stephen Deitsch

of revenue -- during producing with, question. to year, a from by came because reps, our reps the just underlying that's our to compared -- and many for into so look last And overall, nature producing per Steve. new And additional here. down nice we've XX% to, legacy touch reps rep our reps start legacy we gains. productivity reps the year. almost adding when thanks last This quarter the show we Yes, at The added actually the sales to actual algebra continued of happy is the increased reps, the you producing and just

that Paragon legacy But drive reps businesses continuing new XX, productivity ways. nice new relatively additions to to to up continuing reps. see We're across are their scale in

excited when continued as reps, the really we think go producing and number about we opportunities about So for reps KPIs of forward. gains

Unknown Analyst

OUS? And U.S. is trained progressing? third the surgeon what split Okay. many training then in were the and Great. And quarter? And how was how between

Albert DaCosta

got the we Yes, We've going along launched, to country. we across literally. continue that's roll just that mobile another lab

labs in and of to continue excess train surgeons X we in quarter. place, now So XXX per

So they opportunities key the that customers opportunities We one they and to we've strong. and to, to they'd said and products as that is of -- this it's see have again. that and have to in new see the the training, be to Denver and much not it's surgeons about that us may here in see things like new of not surgeon using road, legacy on want our our see come as also it just try it currently our products all past,

new opportunity seeing from efficiency we're customers, lot and existing be to some we're of the at same for our customers the also our us new a a time, reps, perspective. cost which we're So drives getting products seeing trained on

Operator

Canaccord. comes question William next Plovanic from Our with

Unknown Analyst

Bill. ] is for [ This Kevin Kern on

supply you kind as a should mainly lot which last color on or into Just is experiencing And some well? supply also launch your more can sterile of issues on are quarter you provide package, that really what's XXXX to talked products new continue the with expecting think improving? challenges? bleed of challenges these those to the new products were I issues, you

Stephen Deitsch

sterile products of you would to saw still slower sterile of it's be Yes, planned. the we our including we would in packaged we packaged availability products quarter, but products. chain what the with all continue like less the to area expected, supply we be, Steve. that in The question. had -- Caitlin, is continued It's consistent we had improvements of the the than that it I as thanks for second tell availability that

or those have not we us while had to we some XXXX. products, with ago. into of still inconsistent be for what So a "headwinds" packed expected not and headwind And part we're we really X X as expect with get months yield do they're we sterile the -- first

Operator

from Stephens, George with next The comes Inc. Sellers question

George Sellers

I'm your things. and by of Maybe a next you pipeline just some could additional exciting clearly, are shift if to coming those some us the color curious year Clearly, some on bit, end of in terms things give then exciting the of things some launches? subsegments, little where also year. I or devices anything for a those extensions I in any are that indications. one know need I some devices lot also can cadence detail to. new maybe put entering those then on of your I if if And the Hopefully, of repeat already are maybe on that question. the portfolio

Albert DaCosta

it. stab Albert. maybe is this George, a And at I'll take

of for of short love You right? know as sweet the do to ever we've excited get year. that to you can about yes, been we and my answer which future yes, that questions your always look, divulge. expect this to is And not to much next some are launches, about we line a is have few as next most trying We and information products me spot, as you year. to hard extensions expecting I introduce But yes launch we're is the

aspect every expecting are surgery. and ankle foot of to cover We

pretty products some pickle more terms than children in think say is the patients, improving other any anticipating couple that we've have got be that children, there going are for a introductions we subsegments, point could the year. I us. we're a significant least are opportunity, all outcomes So they of significant at into wouldn't of pretty which for of but next a special my

which been of XX, next our yes, got module know. of a we've kind of exciting the world including So letting things really we've couple first launching year, Smart

launch to the or first at half next next year. least that early year expect We of

year, X around. X a Not bit the at launching launches that based be products launches the underplay that some we and this something we between tail is end of that we've see of excitement have somewhere earlier might approvals, regulatory some but that and some might little year. to product launched on still than of We we've this lot got limited a

stuff So product of a lot in terms of exciting development.

afflict And that and closer influence a to our extremity goal. closer launch I of one think possibly these everything get we lower goal every And that could products, patient. is we time to

love So question. lot I exciting we've and got that a of things coming,

development I really tickles every is me So work day to there. get that what what doing and to product see come we're

George Sellers

looking bit really helpful, additional a and we're to shift on those of future. some details to Maybe little in relative trended performance the us maybe on back in That's give Okay. some expectations? basis more hearing how the a some and forward to monthly to about the the quarter. you Could your subsegments specifically color

Stephen Deitsch

forward Yes. seeing that forward. then looking kind on back And Albert one can way third year-to-date George. every in, Maybe having we quarter to in that's such as to come also in be basis, of going of well and our continue next go week. these the each our thanks Look, performed and I'll you that's segments start, benefit segments. And business a the of a presence of strong to

he Albert XX have But And of doesn't children. his one top other a things few favorite Paragon is like than says children.

performing look, singling don't we do. well. So out everything is And typically things,

So with stride break that. to we want don't

to is us. important So us and each for grew subsegment

Operator

Our with William Brandon Blair. question next Vazquez from comes

Brandon Vazquez

implied versus a the but It if low Congrats curious the of kind nice one a over guidance. right, specifically. I'm QX, growth quarter. something range, I math ask for It's QX? relatively implies end QX. for on doing at of If I'm rebound on the QX, least like high kind what's my a to end to wide growth low you for XX% in in nice want teens use

of -- the what of into the talk end So guidance to you maybe you can go as you gets QX. end the or high low high about that

Stephen Deitsch

Yes. and Yes. to coverage. question, have thanks the picking for up you the calls do and Happy that. And on to it's nice

and there. And we're and some the that So supply related to at the low experiencing going that's to range on in with for just of uncertainties end the supply the uncertainties we downside additional but the chain just our consistent opposite, a macroeconomic potentially and now, off the say intentionally foot previous robust I in we're chain right not high with and end experiencing just just the nothing environment. some $X.XX clear, plan potential continued improvements potential the In There's chain to for $X.XX elective left headwinds but now range the of be from nonelective expectations, just account procedural we'd is certainly a what headwind also for accounts supply potential, would and assume macroeconomic really ankle to low which environment. the end perspective. the

Brandon Vazquez

Are then Anything updates in helpful timing of And kind get try XX, shot a maybe other Smart to guys you would of a even to for little in take details you any for pipeline. Great. the bit that understand, have I'll filings? switching regulatory in if of like module gears you, be you can and expectations are commercial XX. Okay. a Smart product? give to guys the point where too but first on product, a can that if see you just you -- and like that where out I if get any you on are

Albert DaCosta

And are we best can. Got right in FDA answer I as regulatory there. to attempt tell conversations with now, and a do you, I'll much my as will appreciate I and we're submission the it. point in the good I

introduction. a do about our have with and so we're being that, And excited the about expectations, be we're is that exceeding been We internally, to cautious but you, it's there. really opportunity, product we're honest excited

is and in we it's means, what little so could going this this understand, the are think difficult understand why support people community for first also I to been I know And that a start and launched and this because I'm that's influence module, it we're meaningful excited really to a looks is way. investment bit excited to XX. really what when about how okay, like, Smart it surgeons

expecting year that a filing. predicated launch, later of in sort we're year, to beta be of But for launch a of next we're this And introduction. the regulatory expecting so scale first half just that on more broad

as at point bit in communicating might small-scale would freely they time, there. come do, just we the we've able go anticipate. launch. a little pipeline to So to got approvals a And what making we more in we'll in then expect to start that sure And if that be the

you I salesperson Yes, it's not I'm now, really hard It's at I So to love and heart. give question, for would you that me. tuned to hard soon. but appreciate the me all stay give the for tuned. stay details a right

Operator

Matson Our comes question from next Mike Needham. with

Michael Matson

I it on of year-over-year the took I the could the half basis, the the out the of quarter of impact context in your a wondering quantify wondering, how growth just supply was did the -- that some was The prior other against, a at that third -- the comp think, good, your have you you're issues growth all? having first rate. growth the quarter. called and chain companies from I Was year. slow orthopedic in of And off but days maybe little also, obviously if that up did impact much in down then fewer the quarter, selling was

Stephen Deitsch

that's for the us. Mike, filed one easier actually, with question second our release part today. the the Maybe out And it's an with Steve. we of for have, earnings I'll an earnings first supplement time, start X-K because there that's

that performance, of performance. comments international can we're you our details the commentary on credit new around here of the of U.S. see quarter around our third about facility, some So some talking performance, our our some

days. of selling impact But including the

So We and the had XXX did selling impact quarter we have that and approximately balance days. an basis our for of points. update pegged we last an when giving between were billing XXXX, days we X less certainly estimates XXX that mentioned to somewhere impact

billing have day in last not X next do we insignificant. also And less this year. quarter it's quarter so we're compared or to And

an had for to XQ XXX that points. XXX was it So impact basis

then it's And that time haven't for have. potential the that with chain, place at you'd the to other been other to demand know able is a say right right significant the we of product the all supply specificity the respect I at we us. this we've that and been quantified or for like pretty than -- not It's -- supply to folks,

and that of behind forward to looking really we getting out us. to be year all into we're so when expect next And getting that

last mentioned year, you strong the finally, grow XX%. comp. then did we mean I And

of all XX% things year-to-date. XX% with growth So we're combined, pleased really those and

Michael Matson

Yes.

help And quarterly given terms in modeling and interest that draws there, kind should can you're you in Understandable. credit be the facility expense, out just us of new Okay. of modeling? terms of the we what there just then taking interest

Stephen Deitsch

Yes.

we So drawn. have XXX

Michael Matson

Interest guess. related, I

Stephen Deitsch

Yes. Yes.

on So $XX have the the out the million loan -- the spread is excuse me, or million loan is the on we and is spread on and on revolver, $XX million spread term it's the term revolver. on the $XXX and $XXX out $XXX

our And sheet income. so million of interest interest on a net cash it's million have yielding balance of a do $X cash year. $X of basis. to $XXX million that's we a probably nice a On Because level

Michael Matson

exactly. Yes,

some that of it. So offsets

Operator

Securities. from comes question Dave next with Our Turkaly JMP

David Turkaly

about it to to, back think I days, thinking Maybe In the one it a for number saying Steve. I'm there. kind XXX like Are I in worth inventory down slides. should a you'll day to it at be year's Thanks. going don't info something component, that inventory get of of that talking There's closer we XXX. specifically to the you looking know, lot good that about we of looks you're level? says guess,

Stephen Deitsch

Yes. been years some it's Look, lot really of have been a inventories, we we've like in capital. up certain disruptions from of. we been stockpiling the that, use like we don't PXX a historic we've talking the came driven supply last enough And for and by have inventory. us unfortunately, inventory. it of chain kind And of that's about done demonstrate -- have And how of X atypical

not -- we're where from be quarter. is an we perspective X compared or going now to even years the year even to sheet improved or we're today our from quarter where absolutely, is this and But the next balance from to efficiency and last improve on quarter fourth at third going quarter,

compared EBITDA X as the made to investment be nice investments negative build really have area the next a base. that's And more any to we've and to legal is going of beyond. also EBITDA our flow last going -- we're for positive into year tailwind become settlement us And targeted beginning also don't a So expectation that years significant then some payments. run next we've cash we year

we us as help So forward. go

supply 'XX this positive So we're to in facility progress flow. in happy really the chain, improving new our our that we're operating cash being we and making and beyond also EBITDA have about the credit and visibility

David Turkaly

One quick one.

you moving Just, front? expecting that we what there should if have to to I going guess, CapEx be at be plans not make, sure on investments or forward? Is other stand that but level? a consistent where I'm you

Stephen Deitsch

Yes.

at instrument building there We last $XX of an $XX had look million. cash We years, of purchased also end underlying for about XXXX Disior we've in year. items. of million $XX -- if couple the you in for That's And purchases or we've of we've flows it, the us in our million. our for sort bought call about couple of for high range there, the in unusual investing $XX million a So probably, per instruments. had

on that's better in I can would think if you that your than want about it's I instruments -- what think to but So annual model, do we an that use basis. been,

then And and that That's over lot last somewhere over has X.X years. to a We last which million the $XX between years. of come X $XX SAP, launched other capitalized was been the PP&E million going down.

also year only get not operating cash lot next compared improvements investing the cash years, to So interesting we'll to beyond. and couple line look but we we last -- of a the expect more

Operator

We have no questions. further

any closing back call comments. for team the management the turn I'll to So

Matt Brinckman

joining look all for you questions in in you again to Thank all speaking . And we call. and the forward Thank to future. your answer, of you. the

Albert DaCosta

Thank you.

Operator

may concludes everyone, call, you, our for lines. us disconnect you now and joining your This Thank today.

Paragon 28 (FNA) 7 Nov 232023 Q3 Earnings call transcript