STERIS (STE) 12 Feb 192019 Q3 Earnings call transcript

Company Profile

Participants

Julie Winter	Senior Director, IR and Corporate Communications
Walt Rosebrough	President and CEO
Mike Tokich	Senior Vice President and CFO
John Hsu	Raymond James
David Turkaly	JMP Securities
Isaac Ro	Goldman Sachs
Jason Rodgers	Great Lakes Review
Chris Cooley	Stephens
Matthew Mishan	KeyBanc

Call transcript

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Operator

Good morning everyone, and welcome to the STERIS Plc Third Quarter 2019 Conference Call. [Operator Instructions] Please also note today's event is being recorded. And at this time, I would like to turn the conference call over to Ms. Julie Winter. Ms. ahead. go please Winter,

Julie Winter

and everyone. Jamie, good you, morning, Thank

as a As our Tokich, President today's for call, have our we caution Walt Rosebrough, we have just rebroadcast consent management. from of prohibited. without do expressed written and only I Vice this STERIS and contains usual Any is words of that is time-sensitive open President call of comments today. information before on Senior CFO. few CEO; and Mike redistribution, of strictly webcast accurate This of retransmission or the

described during does Some statements could review available the to differ any be undertake those the and of in filings. the may STERIS's future results update including result factors considered new actual statements. made company are materially factors securities this statements important statements, on are forward-looking website. in or information those The limitation, filings through forward-looking revise events SEC Many of or from to or a as company our forward-looking STERIS' or without cause risk developments. not

financial on operating including cash addition, will free income, non-GAAP growth, share, measures, organic call, today's diluted and adjusted earnings segment used. be flow constant currency In per revenue

in their hand and to financial supplemental will to over analysis including GAAP providing information definition, including used of by financial available information these with of intent are call regarding transparency Mike. the financial Additional Directors measures, the decision-making. greater cautions, presented and measures. call measures and on With reconciliations today's Non-GAAP is financial management release, between operational the I those non-GAAP during this Board

Mike Tokich

good highlights with this my third performance. of morning, morning and to It everyone. you, again be the is you pleasure our quarter review to Thank once Julie,

and labor XX.X% from and revenue divestitures of of Gross to For tariffs. constant than quarter and in EBIT basis healthcare margin due lower XX the anticipated was quarter higher SG&A somewhat basis currency, adjusted grew the increase currency for XX to in impact was diluted XX growth price anticipated an from points employee favorable costs rate. for items. by the causing quarter last $XXX.X to XX third due by organic million the the higher increased of basis impacted we rate tax tax XX% calendar increase effect quarter. EBIT the better than the impacted of claims than to year. points earnings $X.XX the discrete second XX.X% XX% and effective by volume and margin basis a to by somewhat offset margin lower substantial quarter for both XX.X% end had was the activity benefits of income per negatively points price. increased quarter levels and and a quarter favorably impact year revenue growth revenue, was quarter Net the in benefiting driven X.X% points The quarter, was share in

cash in the of $X.XX total million December terms debt. ended at of $XXX balance In we billion with sheet,

expenditures third million. the quarter, capital $XX.X During totaled

million fourth by $XXX the our are quarter plans expenditures we expectations spending our Given for for XXXX. to the to-date for capital $XX year fiscal and reducing full million approximately

approximately quarter, will announced plan improvement next a during profit years. generate over we third reminder a restructuring of the As the that million two $XX

free strategy. of the amortization have Unlike usage sheet operations. the the in the significantly items two amortization cash that for improvements cash mainly Products segment. products accelerated with branding million both balance depreciation flow $XXX.X strategy million adopted from In Healthcare the addition, restructuring included depreciation not in a $XX a certain out associated trade and for P&L, a in we associated and to do to quarter have quarter. name the months first and phasing the increased for million significant branding higher adjust in we depreciation amortization $XX.X nine was Hence, with the cash of resulted to at primarily due flow Free plan the nor increase These items. these and for due

expectation to fiscal We costs his full million plan remarks. are With approximately capital now that, year our turn plan XXXX to call to updating free the to cash will higher include $XXX cash to flow and I restructuring year. the is for Walt redomicile expected for flow Ireland, the with associated over Free be working requirements, costs.

Walt Rosebrough

good Michael, to all demand up our be in and solid STERIS four a by year customers segments. Fiscal shaping morning is Thanks from fueled XXXX strong everyone. for

and three growth expectations constant revenue see expectations our of the quarters device solid medical For core increasing to of revenue are to result the so Each we’re as far underlying our our our ahead X%. and segments AST approximately Healthcare leading from currency have be nicely organic with growth first way a year revenue for our contributed revenue to constant business continue growth demand customers. Services we growth this X% year. year-to-date. Specialty In AST organic are currency full

exceed States. revenues the with improved and segment in backlog and as as we has planned Healthcare over our healthcare by profitability the equipment driven this quarters. X% grown in strength have successfully ship Their past year grown year anticipated or Specialty equipment. capital so. both primarily products, next growth made is so revenue constant in capital the few the has our continues to expectations shipments, Healthcare over Even leveraged to Our with has Services currency investments the revenue recurring also organic strength far nicely United

currency Life growth capital X% year-to-date We expect across with quarter shipments. a grown finally, the healthcare fourth business. constant solid has And organic revenue Science in

so not steady strong capital or year Science certainly that year continue. to the equipment has levels last will which have was gives do us quarter our stayed a comfort trends quarter we we expect the shipments this above for Backlog over fourth versus Life and year. year replicate record last Our which underlying historic last experienced relatively

be fiscal XXXX. our for mentioned overall As we organic growth now to X% revenue I earlier, expect approximately currency constant

a of enough I $X.XX. in morning confident call your outlook to we quarter, effective favorability ability will another in due year, continued turn XX%. With we to when range earnings over quarter record that the note on or rate our thinking continued that the reguide year are will our to upside for adjusted certain to third items, around deliver support in the on $X.XX effective enough discrete but this join taking Julie rate tax this with rate. of As Q&A. STERIS. we the the our would the open last have rate time for raised favorable per share to We come result, was tax and range a modest tax appreciate substantial likely the your that us fiscal will the to not in I to

Julie Winter

Thank you the and give you've instructions. Mike Walt, your Q&A start comments. for if we're Jamie, ready to

Operator

question [Operator ahead Raymond from Hsu John Please Instructions] from your today first with question. Our James. comes go

John Hsu

Maybe segment other can you consistent but it the revenue what's - is quarter decent think implies that a anything quarter, driving with pretty standpoint? in or with start could is just fourth to that? guidance, the so guidance, the The a maybe any the you deceleration be from pretty organic there conservatism to point third it else looks I comp

Walt Rosebrough

on have shipments one our we like run Sundays. and our I on there's Saturdays a than quarter. of be would it plants bit have make, trying probably about and item. happens very Saturday, been to strong a the fiscal may that that last quite you secondly long relative doesn't day our there's will result to trying more traditionally effect of affect a I last the on loaded patterns move to relatively correct. like year March year of we've possible situation success fall where level as little and Brexit and all, We on coming don't pattern historic I fourth some our so growth couple We've the a had because or away do you're so as John. bit have quarters, days revenue We a we're have run to strong less been Sure, A be about we that to we certainty big three before may this would time first and we've quarter. to some I have XX equipment be conservative first that's the of one points fourth to extent capital year, recurring a is for March does say as the end a as the a year that know being from to we've factories expect but talking Sunday, And we that forward. We revenue, been shipping speaking and two not mention period shipping someone year, that. strong do this will pull to with which how relate

conservative are of turns bit X% to the end forecast, being of how out. but month we're the see So a in quite we March probably our we'll comfortable

John Hsu

And shipping another range. been there's that the of then the contract XX one you less over X%, hurdling. last basis is X day. organic you're probably so actually it Sterilmed also I believe a in years taking now X% there's back, you're guess call to guiding mentioned your actually growth I step probably or points This X% year

or a point consistent you those at organic you believe just guess X% at range all growth drive better? I So the taking pieces, are where can you

Mike Tokich

early end say over plan tip more Clearly to next a X% I target. to beyond speak we're that time. looking could think right saying going kind to possibly long-term for at us as of the little that we move we're of it's that above it's next - X% bit talk we're our We We'll now. now. and at be year I to or early we're about think but at year's top

John Hsu

cash redomicile flow changes operations, in prior the capital, that million working one driving the then restructuring but talk of then by think CapEx versus specifically flows, you in can $XX guidance? the higher you're last on cash and about reduction CapEx on plans to very from And on pieces, what's me some I clear from

Mike Tokich

We Yes, perspective. a and a timing just more we're the behind goal John, of year than that. the of it's plans at to timing mostly nothing from projects. our out due beginning original set It's

John Hsu

associated there that, a just with cost obviously some quick follow-up baked things projects an for big upfront that. outsourcing just sorry, investment to believe in you've of CapEx and I is And

So far from you relative Mike, expecting to just as outsourcing comments, revenue in your as is tracking in year? for million everything the the kind $XX of were that line

Mike Tokich

the business equation, growing - the nicely you expectations. of from year Instrument it and on as the just outstanding an ahead in sides United the of both having slightly in they're actually the having see the they're Specialty is is growing Service Outsourcing growth business Actually and that can business, healthcare Management States, in business our

growth. million $XX about forecast had we year this So

here number we that we've or fully obviously we're objective. to expect As today already to so sit - that exceeded going we meet and beat

quite it's nicely for So going us.

Operator

next Turkaly question. Securities. your with question ahead David Please Our JMP comes from go from

David Turkaly

the margin it should through Primarily, can directionally that of expect? flow the guidance, if would profit looking we as to might line, the X in you great? moving question flows restructuring Any sort $XX be give And asked you how you the color how looking gross want what on but about comment can you should that we million, got sounds any forward might improvement at specific like years, comment the higher from on I be terms wondering specifically that we're make was of over through P&L? the

Mike Tokich

next our $XX implanting that do that we some next second facilities plans product be the and it our years. in plans are take year year, anticipate as manufacturing happened About backend close some actually anticipate starting year we just we majority will million consolidate it to fiscal and the rationalization and happen over will of that in So, our our X loaded more time. that'll

next be the more loaded year it and FY then So I bulk of bulk the in say they'd of will would half happen XXXX, savings. the back

David Turkaly

board looking out plans how in there the asked side I any given roll might we we lot that guess question I into M&A environment on this and know but I you your fiscal on about haven't and seen any get update we're anything sort - you that And on next side? of the ahead the M&A the get that might year, a a I you guess see seeing color, had back

Mike Tokich

a to the is We I call that relatively tucking acquisition, of what forward. of would going our into. favorite tuck-ins, have active Again, few funnel. are those is so type have an compared they're of most we've actually year we that's things good pipeline had what this small a active and businesses And

we're things are there acquisition, significant at. more looking a of terms In

we've We have those been for that times Many companies can the issues to are not action. two discussed so for all careful board right take that something make are we there high private to the secondly, overpay themselves. concert, purchase. in across possibilities fairly possibilities now before, price again, There as And are we some unilateral be market we in time. not and is but want have is, one to decision that there may

of next to it in us have do the of the not not timing. if one and if those combination surprised should think morning not do a you It's should be matter that caused a don't it's a surprised So bit purchase things just two you last tomorrow we have little but be something significant year. I we

Operator

ahead go Our question. with from comes from Sachs. your Please Ro next question Isaac Goldman

Isaac Ro

bit a want of no just sounded side. the to items talked at implied end in a pattern for about to just want timing maybe and fiscal with It clarify you're look do maybe little Well, quarter. I on it outlook conservatism from in but clarify demand of lot want comments markets, the the fourth had maybe seeing just just like change your to you to spending that your

Walt Rosebrough

read say will you supply that in than From correctly. if the side. side absolutely is demand more would you all I the demand Isaac, fact side than this

units timing if to anything there of ahead balance things days, day and issue. people Brexit demand are on pushing a again calendar accommodate plans which The hot. to everything the our are running or things given of know of you consumable solid pulling the All a behind day-and-half anticipate growth uncertainty side. runs is continuation, number experiencing our that's if the just from point-and-half side And is that. the We less a pretty

pipeline the but given months particularly year XX patterns. two healthcare probably slip, growth see in difference no about that a a of terms for the or And the in in can so. consumable rates the or year the out we so effect of of orders of wrong seen couple difference then talked pipeline we've no capital a And in if those the fairly side orders we capital significant have on days on have end ordering now quarter,

more So quarter. the pipeline might I seen reflective - I seeing guess differently by what our I we have I’ll numbers would implied of are not suggest and think what say be year fourth still in full are the then

Isaac Ro

Could then kind helpful context. guide. up kind that’s the run follow expense cash XXXX And really and fiscal kind the or about you of cash margins one just is I mentioned parts once those on the that on hit have were a if the not to that Okay, guidance is and curious Could year a costs OpEx on whether through the you then the someone a I'm us redomiciling bit extent next you're free sort and little the side happen. little what thing one of of one-time on side, talk bit sunsets that in well? you was there. two tells on by And and into of the into on or you carries free incremental rate benefits that P&L effort done more think move about which related that as items. with

Mike Tokich

we estimate down to right is flow. that which this now has are will from and the We one In reasons fiscal do out free $XX P&L we Isaac. would standpoint about regards of certainly which cash been cash of early a are taking cost standpoint adjusted impact $X to anticipate it not year most incurred the about redomicile adjust million expenses the which be Ireland out. Yes, both revised us a on that million

their And additional take deductable they they in and deductible going that, of claims procedures moving In or once the surprised that a deductible claims. of be the seem high employees hitting activity in lot about addition needed. of bit the talked we to hit that healthcare as anybody would, activity fourth fourth calendar level the we required if is as to quarter to or advantage by if little our through we would were claims

activity. surprised that was quarter. in so So pretty us the basis a claims points margin we XX I impact it significant little was our as of And were bit by an to our mentioned about for third EBIT

Walt Rosebrough

not you on Isaac a it's seeing at characterize adjustment. as is bit over that I find expect the we we course basis would if a significant behind will just months as a I that of the this but are to at not We've be I the actuaries that But been would think particularly effect you the year change significant look for XX do and the look that so over significant timing the year, go actuarial to we think full I a the when it always that do same. months nine

Operator

go Rodgers comes Jason Our Great question from Review. next Lakes with question. from your Please

Jason Rodgers

Regarding segment wonder forward quarter you that compared think further going this what quarter? segments talk if how you in that about about your we and leverage and saw in nice could HSS operating the to should investments

Walt Rosebrough

Yes, about at business don't difference in in that view the general outsource Again and a on this we've it's in talked past in reprocessing small. relatively feel still point time. the I

there kind is double being kind we but be probably basis mid-teens quarter-to-quarter even were this early dollar on a business so early, year and way say - now about exactly over it. late it's Mid-teens we are type a to expected differently year say as basis. doing term except as on make more they are we of to best to basis, will as fluctuation the on we way said we feel another a see almost early on on through maybe invested of we So they the - a so investments long sales don't mid revenue bit return year-to-year we're that as in little margins ahead impacted we flowing and that said a that. going last Obviously the is late better

again fluctuations will move as So, think some see and we you forward. I

the is but that If having those combine business bit business when ORC repair instrument you specifically fluctuations it moderate the talk business about said because a that with you larger. it

saying total that years. couple we’ve in feel of been for a don't then about any we So differently now

Jason Rodgers

change you globally material are Walt on wonder last just And quarter? thoughts hospital said then you provide if any what could if seeing you some spending from

Walt Rosebrough

Really in backlog that significant can all see we you of a short change the at – differential. answer is no record the levels significant first see pipeline by pretty is are as and record

And so also the pipeline for next shipments bit, pretends in terms continues solid. our little of to stay that but well

feeling we’re still out have in they out So may on we a do healthcare Science about We quite to healthy there looks like we pretty that beat materialize the pipeline timeframe quite visibility us. months pipeline in good longer in we to Science, don't the has Life not the but but see large what Life we things projects. XX XX in see

Jason Rodgers

Mike yearly rate have tax the then an for thoughts as fourth quarter far in And and for maybe estimate as you the fiscal XXXX?

Mike Tokich

quarter XX% in to to Yes, fourth or exercise during did year some in tax But look guide deductions XX% we zero and plan this is favorability the will still we us. at we next and some effective out as going we approximately compensation would that in as we XXs and range look due some rate. approximately helped quarter which that timeframe year. the we stocks the that get we We for full to to the be the continued May low were quarter is to options have related obviously did equity think say have stock typically com particular for our

Jason Rodgers

you EBITDA target do and And the that? what current what have debt is the for is to then

Mike Tokich

really in we times about comfortable operating been we have a times specific ago feel Yes, about two three levels two that the don't ranges. low We to currently that somewhere we the took se are at synergy target we've talking working levered to per over bring under just we and down remember acquisition with leverage the but are. just up X.X of years

Walt Rosebrough

STERIS historically debt that well up. two under a time, for long recall those may have was taken You levels we

I think X.X would most the capital the of if at and fairly sit bankers capital between look say our structure flat. X.X it’s you and someplace structure optimum

this we the are on don't is. across point capital pressure capital in what terms at So issue a our rates structure of feel debt

X.X So flat and between very and between X.X flat it's pretty X.X/X.X X.X/X.X. and

feel don't we pressure So there.

Operator

question next from from Our your comes Stephens. Please ahead go with Chris Cooley question.

Chris Cooley

point this with that us Just to op growing going teens And upside margin seen capacity Walt margin what's percent on in ups? of just kind we've help I've bit just margins. quarter Could the comp a couple you brought did on to a time in off level quick starting us utilization little tough the that last a couple over a that months. we're XX mix set contribution that bit is very from change me you from in prior that plus high about the to AST a you the the here little XX year. forward. AST see follow in first X% at the you a talk driving And one expectations it got the of there for Is AST that would

Walt Rosebrough

are growth the a who you guys of in of that comments underlying pretty makers and quarters. is know the Yes, most the driver follow as a device business the Chris solid couple devices having medical

And because that's tend to so mean we they that when demand I to, do business. the of ultimate

capabilities the and to we less our our They that impact. we plant this talked depreciation but we odd to have negative we’ve seen have our for our bring margins of expansions have start We rates tend and expectations tends run we And off expanded geographically as utilization effect have because costs, on and have great and those are that expanded early we've online. XX out now and in year. paying some that individual plants have up about a things

for I I low high suggest suggest fairly mean high. we're getting to our stupendous. and those a are of normal of rate but wouldn't the running that XXs money where so wouldn't do those a numbers that business. make XXs. that not are that of capital I run spend not so attractive lot plants are to a kind between lot And We ROICs

range. XX bet wouldn't you but it fluctuations wouldn't but not life suggest around I will always I that say So, my I wouldn't those see we'll either. against over are be that

Chris Cooley

Understood, appreciate you we it, still the nip, year great backlog Life growth realized there. had when I the at and there. performance And guess only phenomenal the quarter, look real I last Science

digit kind of Science we if rate? is of a was from it go the XX% a I of trying X going these not in get should is out being down of to the through growth normalized been as here think growth last bit here to one and we think on course enhancement driving to a it to mid-single kind lot up into the basis over years, turn is of starting worked would on and had that retooling prior - fiscal that that up kind starting growth kind - I or projects up year-over-year year having quarter we've this normalize But X% why the of put we to XX. start that basis capital a off sequentially. time go are essentially what's there this seen before I'm back that capital Are year-over-year Life

Mike Tokich

you X very we way. headed time don't staying Chris, jumped expect When this it started it and strong that anticipate business. growth about XX% in for kind we've percent up ago, comment years XX%, your saying know think don't excellent it, really those question we XX%, I I rates is XX% guess some and of and rates now growth been

to level or though to backlog out don't like of a you this because is concern think at thought come Life this chunks. we're from kind we're and it going shipments I'll way just was it's bigger, are Our time, of of go the is we call - up jeez kind know shipments the in same the drop Life lumpy is down to that kind or big going Even so. stand one Science Science, again lumpy order in in in going

is which were right as to the it today don't I January year - was we down remember a year. the speak bit of out where As back turns roughly a of was in December our same within as at we end last we're last the backlog $X but million it

so do things I don't nor steady upturn down us all looks expect a I turn, state. expect a being big So to state, steady but kind equal it big looks a of

Chris Cooley

Ireland. XXX then And me, kind expense make was at to have two, from reconciling lastly an to cash so When XXX original sure your the correctly. this flow, additional up when guide Super. you I on $X did just there look I picked I but redomicile of now you're million the in

You there. do kind in $X have additional million you headwinds of called out

of CapEx. of So reduction in the timing in essence I'm offset course looking the at it if that's the with the $XX or million

just way? to factors, those working my of back, - to that that's XXX the that are I two way about kind go thinking am correct in driving back trying to So just essential

Mike Tokich

that backlog top our is working shift to from we the and some on high expenses about a increase three have and There's cash by actually there's knows of in mostly driving inventory is Yes, factors, additional then costs million, Chris. QX. as backlog restructuring requirements not again as about also capital $X $X perspective is all everybody in million. that the There going redomicile

that So $XX QX, some as to we we've building increased start but inventory there. have got about million will in of carry in that product over

the of than and and gets the roughly CapEx and you $XX helps that million then to XXX the take you that reduction So reconcile XXX.

Chris Cooley

partially… offsetting So those different each the other underlying leverage there tapering, clearly it's factors just not

Mike Tokich

you Exactly. the know P&L. do on not we do as we And like adjust

P&L on the in restructuring those So account sheet. the continue Ireland to adjusted and for in balance get the the flow cash but free the we on do

Walt Rosebrough

revenue delay to now are have said, we we forecasting And a end if it's we in construction to two it to It's matter a year this some says, the not week We've month and a customer that need year there built my going are into forecast can week up before. would are a do Chris it's products before with ship. - on "Hey, had to to the the don't would than that usually which just put that calls up certain ability They the conversation start we anticipated." next demand inventory. add we that our orders, as so we as same make is ends slide the and not revenue ship already and I as we particularly before would a this, we it, product is more the being forecasted, because result of does I I weeks of but that why if match - job of specific it's a

the logic. that's So

Operator

Mishan with Our next question. Please question ahead from comes from Matthew your go KeyBanc.

Matthew Mishan

On centers, running. in up on U.S. and congratulation revenue getting the the ORC that

You more two and now mentioned one, whether had at three were three you three you there that point then contracted. than right can centers or say have or of not open now? open that Are you those some contracted

Walt Rosebrough

or are Matt, those one, now right three open and… two, of

Matthew Mishan

detail. Thanks for the

Walt Rosebrough

answer we're kind and so it were last liked going The we're from customers, get about we when early that doing absolutely orders question yes. was a the on the Matt, start process away have numbers of to specific we know - going talk I you of not your when contracts. to time about up, mentioned individual talked magnitude - to people As never this is,

running. We have and up multiple contracts

piece it taking a anticipate only of beginning may walk a we are are as we business that more of ORC. some facility, their When and number full ORC, of work, some capital. capital outsourcing inside where a their those of we're work, would which would the have And by doing Some you outsourcing we're the those we time of of places which we are some think only may over taking of and they where more. places we are full

U.K. a it number inside in we as back as So of a center that's business, have of full but their forth the outsourcing think just - centers if some we there's the where we of we work outsourcing the U.K. site in we're site you have where and of a is traditional ORC all the which work doing do are do customers in and work. certain a a spectrum we their this off but the ORC and In trucking standalone would what

that like All going not model to much across various So over to already we're to down the it business. - at. it's quite go fronts we're going say is obviously what will we in comfortable and grow achieved our very and target so this We're U.K. that continue is we've nicely I into break can details. it the can yearly progressing I

Matthew Mishan

us give moved model And the a from is U.S. those with to for this yours? operations as of sense facilities is the you customers Can transition you how or it gone a new their their

Walt Rosebrough

next site easy. little transition some testy of of number do thing that's a we bridge customers other not Yes, and be of and switch and the plan we're off on once more the as to and think There our so moving if as more not their transition have well, middle will in and think is to building facility and then number would opposed them moves. so But and you're you in for where them the facility the of even offsite any like a in That across. in off a of like it. then too for pieces turn fully you - the both capacity why rebuild the the other reasons sticking hospital idea XXX% and are center more a are far. a know are it's places switch you of these is of at possible would to their it's have it's cases work it a trying and better all you we transition absolute, some then then And of and you is to whole not it the bad thing is an

time. typically is the over it So of course

Matthew Mishan

consider close in and a take significant significant deal? surprised tomorrow deal And but wouldn't looking you or at does then like know to you're would not year actually Walt, deals significant I what next the know to several not the a be were the word to pipeline? every literally mentioned if within I be you that you And mean just you

Walt Rosebrough

differential bigger for tuck-ins at or but those are getting looking business that been whole, of business and those at shrink those as that than to of even will, the some see of opens The specific bigger those we're greater but for the significant businesses either deals time, I things of those those at some a then newer a magnitude I more if us. think is if deals guess to ours. I XX% sense or think that that - the five it's number magnitude, the to that XX of I possible over shrinks a tuck-ins, or think Yes, the looking it Matt, so size don't that are big shrinks tuck-in a as for only of even in orders or kind last pipeline looking number we long course are of putting STERIS you individual of of and XX% doesn't years. deals difference we've than less are I we either them in wider it the of that and some it some in are order in are

a switch question. pipeline it’s overall category So an not

Matthew Mishan

depending an on you XXs the where comes just captured to probably Mike year then the points are about last And upon XXX you confident low in think is low you way the how but XXs And that. in cushion in have that reform changes extra in it guidance. tax have one, any given stock basis you to all then is that

Mike Tokich

in I we the least favorable We pieces. we seen finalized have Cut been that capturing that standpoint as more captured have at published say could been exercises are the far a comp Act. we we at And has depending this that year on what this originally would as Jobs is anticipated. point as definitely the confident has Tax time of under from than very volumes the all stock that

proposals very final are is final, we to are but those whatever there's can't because out Now those we obviously speak there comfortable.

Matthew Mishan

All right, thank you Mike.

Mike Tokich

You're welcome.

Walt Rosebrough

If world with stop be would to confident we could our get tax very forecast. laws we the changing, around

Operator

for showing this [Operator Instructions] to I any And questions. closing to conference call I'm management remarks. at no additional over back the turn like point

Julie Winter

at for continued talk us your to today, support everybody STERIS. We’ll quarter. again joining again you of all Thanks next and

Operator

you for call joining the today’s and conference Ladies gentlemen concluded. presentation. has do We thank

your You disconnect may now lines.

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