COO - Earnings call transcript Q2 2022 | The Cooper Companies, Inc.

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Operator

Good day, and thank you for standing by. Welcome to the Cooper Companies Second Quarter 2022 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Kim Duncan, Vice President of Investor Relations and Risk Management. Please go ahead, ma'am.

Kim Duncan

to Companies welcome Earnings Quarter and Call. Conference afternoon, the Second Cooper XXXX Good

we the the will included call, today's During discuss earnings questions. and for in results release then time use remaining the guidance and

Our presenters White, Chief Officer Officer; Executive Financial are Brian Chief Treasurer. President Andrews, and and and today's on call Al

anticipated market Before we forward-looking remind guidance including regulatory revenue all to other statements, any acquisitions, per and this integration share operations, that anticipated acquisitions begin, you I'd results statements and conditions or regarding and or benefits. like contains conference of earnings of call their

Forward-looking of statements subject the and be to data today's filings, and company from for materially the now results SEC could in our opening Should methods filings, are in investor incorrect XX-Q uncertainties. in earnings and release that actual Events that to statements under differ depend may forth on described are And assumptions, remarks. following set risks cause at caption any those and website actions on you the XXX-XXXX or described which the over Form have coopercos.com. forward-looking call call (XXX) e-mail are additional or statements including XX-K future are line imprecise please forward-looking our or turn Al our our questions ir@cooperco.com. available Form all I'll call, to Cooper's at of his and

Albert White

quarter conference Great. Thank second welcome, you, call. our and to Kim, everyone,

COVID rates. successfully maintaining China by a in CooperSurgical we're to share of our start continuing managing highlighting businesses and performing and gained We're chain and market-leading from posted strong supply variety me Let growth, CooperVision our through momentum. growth to challenges see well. revenue restrictions are extremely that strong Both are

the year So I'm progressing. is pleased with really how

both incorporating continuing see. businesses For organic year, QX guidance the and we're increasing our our to by strength outperformance we're for revenue the full

products CooperSurgical led strength at revenues or organically. $XXX Consolidated as XX% up $XXX all-time but daily and which growth our hydrogel reported details, quarter. quarter and CooperVision's high share silicone provide business. at million, management impacted contact will CooperVision up by reached million, by $XXX quarter was XX% the per in solutions million, in negatively quarter. the portfolio with Brian was were our organically myopia up CooperSurgical's another and this an to X% posted $X.XX, fertility Moving of Non-GAAP double-digit FX and earnings lens The business,

Moving to on all reporting CooperVision and organic percentages basis. an

resulted as X%, The Our Pac in those within torics nice revenue categories, we we EMEA organic growth you And diversified up estimate XX%. strong This spheres, growth for multifocals was impressive all rate XX% Americas performance. against strong and were of and grew regions. is in share geographic X and product XX%. Asia nicely grew all the which quarters, our calendar QX calendar grew our XX% tracking market QX following was gains, grew

numbers, new relationships well customer on remain flexibility strong we positioned gaining product our execute to we continue and as and key market-leading provide service. products, So expand through offerings, account fantastic ranges, deliver customized share launch

strong very lenses silicones growing daily broadest results, the to we Regarding products, the in and Daily the posted lead our portfolio silicone industry. hydrogel continue market, XX%. offer

through we is remain categories launch spheres worn. in best of of lens about our MyDay, effect nice MyDay but is very markets it's they've rapidly halo all the The optometrists range MyDay to multifocal year. it's binocular the out brand. a progress on multifocal. breakthrough on this well, our ever torics, This still available, we'll continuing The already from the on taking is while Our and we so broad patients system future the geographically, progressive available are and highlighting fitting remains multifocals. X-day spheres, torics share as limited worth And continue and also is premium are a rolling it's these feedback successful it the optimistic success fantastic, offering, multifocal where of the driving say and performing

silicone available multifocal portfolio roll and hydrogel as in our mass is well region, which our other toric Japan. The especially to of sold quarter, year and out also we're market This sphere, is lens clariti, a in is this more Pac this into where setting. again Asia performed brand continuing really daily a typically in

lastly, comment FRPs, happy to and all solid sales. branded Avaira these our about X% offerings, in that as Biofinity the silicone And another growth report we're umbrella Our of quarter of reported rate an product uptick growth. I'm an seeing

our you are lot own brands also take of aware, customer showing includes which many MyDay. As customized a brands, we especially growth, high-quality strong CooperVision in are offerings, our of pride but

practitioners. to myopia including We healthy, strength million, our driven $XX management. posted by part up of The Moving growing up revenues in XXX%. XX%, private business MiSight of extremely is accounts continued key and with specialty traction

our customers some selling where is MiSight, particular, segment lenses. sales and their our continues halo market. hurting another who restrictions seeing And management also growing note, other the encouraging geographies excelling world the of well. are COVID but are the with tracking is of selling China, all to positive ortho-k our on our accelerating the in the data trends launch we're of as We MiSight in really embrace community rest myopia have are challenges MiSight in performing showing impacting ophthalmic

myopia EssilorLuxottica seeing product management in and venture exciting SightGlass, with additional glasses. closed markets of the in additional availability joint we're such China. to We our already March, and including as progress, Moving

we right sharing SightGlass FDA in the with data the FDA is and an compiled now, clinical the receiving near future. data Regarding it approval, the to for and look forward X-year being

management, results. we're and strong in momentum summary, to posting myopia we all So of areas seeing in strong expect continue

touch our Recent Before a supply decline this moving significant and to hard, solutions market we've operation business. data, have in let me contact challenges on hit lens experienced sales.

facility. declining industry business going that's require to of a strategic completed a we in upgrade this a a confirmed this, is lot Given review and to the nonstrategic capital

by down last million we exit financial $XX So year-end. year. business perspective, roughly we fiscal the this $XX a revenues decided expect to from business From this report in million to year,

market from are our childhood these of lens rates and wrap exceptionally additional to is in the patient on rest to Brian of contact P&L minutes. the well, and even CooperVision, tied and Growth the comparability, will ensure are performing traffic up challenges. increasing We transparency in silicones provide the To COVID. of face results growth the a color excluding lower on offsetting daily in organic few prevalence COVID continuing an myopia

continues is as should vision expect supported Growth We of global in strong season that traffic that patient to and we increase look this fall. also and a growth XX% the to correction, including expected macro remain today back-to-school to trends the strong what by to myopic by is is improve, industry to X/X world be the XXXX. forward roughly around

fast-growing our CooperVision, robust ongoing business, product For very a data launches, myopia have and management portfolio, product strong. remains fit a we

So our we future. remain bullish very on

Moving to CooperSurgical. We in by posted growth fertility another led strong double-digit our business. quarter

these, our with other to IUD equipment, rebounded also start $XXX from along up activity. Our business strength with growth, as unexpected me by portfolio Strength believe million, product testing, the throughout our and that of We COVID posted fast their returned medical as genomics seen but areas. posted capital lab comprise strength was some market, in storage was clinics AI-based transfer. device a to embryo our which Witness OB/GYN lab RI cell select stem optimizing XX%. and donor ag practices weakness used Particular of proprietary safety management which consumables, seen let our implement track doctors security fertility. best PARAGARD, to portfolio quarter. hasn't through broader our automated did genetic maximize system each our products, performance from Fertility and the sales which Walking solid from have of

X%. Moving posted to surgical our $XXX down million, and category. of office sales We

strong we most and our portfolio given X%, Our Particular impacted is closure supply strength within by business OB/GYN seen this this devices medical and unit area the grew was laparoscopic challenges. labor where were delivery which products. chain global in was

is sales have commercial grew they going exciting that some to ton now X%. seeing additional drive There early business synergies. the activity to growth and of cell are Moving entered The with we on integrating business it's our and CooperSurgical, ideas Generate storage teams stem a into synergies, well. acquisition, success this right

bullish on in this I our remain future So space.

continuing wrap Lastly, up control move a pre-COVID end pressure closely patient telemedicine. entire in the with on PARAGARD. see CooperSurgical, softness remain market for few doesn't what we're me levels we'll the the the and is volumes flow let a to by in see as under shift the pills takeaways. behavior Sales lower we optimistic buying year. appear and to monitoring market. the driven This certainly were of has To temporary key we and quarter, towards down remained with lower we a product-specific X% return to be IUD birth believe to cautiously as highlight on We're marketplace

we're that synergies a certainly First, is parts fertility we're on, Generate from looking cell success There the commercial the now. right on success storage capitalizing acquisition, this and of of seeing stem a and both are acquisition lot our business. like

growth of X% and upper perform Second, strong This market of macro our we the industry part growth to fertility us is with range. a to that with continues forecasting extremely trends, solid business continue well. long-term in XX%

integrating customer conclude, they've last completed trends. and businesses these To our in the market-leading managing challenges, significant beginning chain has with macro industries Lastly, while of team operate service strong strong supply X and since and we performance. even and impressive acquisitions so fiscal logistics recession-resistant sales growth year, through maintained

our sales amounts significant of annuity Additionally, in nature. are

on investing several to ESG growth our our dedication didn't facing ESG be employees. progress can remain Cooper released special value. lastly, while the maintaining in focus to such times a drives which if on So our It's advancing resilient managing highlights you delivering sensitive growth. shareholder our important I We'll be progress like and long-term ensuring areas, we're in find a and report, intelligently initiatives. we success make This report continuing their and Relations this, on We I'd remiss to our makes projects our And this on to thank place infrastructure our be page. and work. includes hard fantastic need us to proactive that just Investor to second challenges capitalize work businesses, support our opportunities

over call Brian. I'll the Cooper So employees. a big all thank that, to to with And turn you

Brian Andrews

Thank non-GAAP reconciliation release good of a results. afternoon, you, a of Most our to everyone. basis, my will be non-GAAP GAAP refer commentary so to Al, please and for earnings on

was were effective time organically. into chain of supply of margin which and revenues, and teams the earnings our relatively basis offset Life were every a from year, EPS of point Sciences pressures, and XX.X%. of expense happen million initiatives, was Costa FX primarily amount and forecasted of grew helped and Within roughly yen tax acquisition production Interest expenses consolidated that XXX XX.X%. last XX% earnings $XXX and costs shares the margin $X.XX, loss quarter, $X.XX large than up to XX.X% and FX the driven higher XX% mention rate Operating remeasurements our quarter, quarter worse usually $XX.X with up price intercompany of down managing but revenues impacted remeasurement of such XX% the currency. from R&D result XX.X was was Rica Second is as investments. Generate negatively trade average These we our inflationary a job primarily receivables. the by the XX.X% outstanding. points operating small. or million, net impact euro-based was as the from Consolidated nice the million, at $X.XX and was improvement is One see Consolidated call. impact. we a consolidation was did by Year-over-year efficiency this, did increases in last Non-GAAP CooperSurgical's quarterly gross portion continuing challenges

quarter significant loss income moves towards the resulted the larger a in However, expense. and other of currency end in

a not and other from Al of operating was solutions this sales quarter for unusual loss color which profitable lens in what The recall our mentioned the from has us an a been this in low roughly had some item business resulted We QX, earlier, to this year. business $X.XX. contact operating add To loss.

Net non-GAAP adjusted million debt so business at with quarter. until flow positive leverage exit the But recognized chain And venture. $XX reduced remains flow X.XXx. excluded operational, ratio activity a supply remains closing expected We year-end. business million remain fiscal this free Vision to our we rebound impact roughly our decision QX non-GAAP costs we the in SightGlass many joint million. debt cash the challenges from million prevented to $X.XX only $X.X decreased to $X.X from the Returning and operating so and QX, the shutdown sales decreased to will Free the was and loss. to perspective, continuing Net a than but quarter. $XXX that. were in business From by billion cash more the due P&L

revenue guidance. we're strength and and to our increasing CooperSurgical currency. growth impact continuing by our see include We're to Moving in the markets, offset ranges our mostly CooperVision results QX the for to of

to organically $X.XXX to and For negative CooperSurgical Non-GAAP revenues to billion Outside unchanged billion $X.XXX holding the to $XX.XX. solutions range expected of XX% interest with offsetting billion supply billion, of EPS a but it $X.XXX impact reflect inflationary are $XX.XX such up $X.XXX chain revenues EPS, the all billion, X% of consolidated lower we're negative rates organically. of up and efforts, organically pressures ultimately up rate This our to in results CooperVision revenues, of and to currency but guidance efficiency range tax that. positives be updating guidance moving $X.XXX that, impact a number are of X% to of to shutdown. to effective parts, $X.XXX of XX% and the X% outside as is in XX% the billion, higher a there of revenue

in assuming we're increase For and a rate XX interest point in expense, June September. both July basis increase a XX basis point and

Regarding now revenues is currency, impact roughly and to XX% the a headwind from EPS. year-over-year X% a to headwind FX

QX that driven let with earnings significant we we of for negative guidance quarter. to be currency don't the me number the to quarterly similar Although of moving provide by QX expect a add impact parts,

large but expect by forecast offset interest increase also to that lower tax a in in We expense QX, be a rate.

our pound EPS, our led For I margin. pending in approval, back reproductive cost QX, include acquisition a flowing process. by it And operator with pending you for we'll business. the does to And and rebound we're lower not guidance we health will Medical's expect still goods, this of Cook a note, is of gross helping That through update once that, closer that regulatory completing transaction to CooperVision's questions. hand

Operator

Our first KeyBanc. Matthew from comes Instructions] [Operator with question Mishan

Matthew Mishan

activity moving here, Are kind macro of any bigger like change start that you to lot due like guys I'll pieces but piece. we've seeing a with consumer A the been of seeing? in inflation

Albert White

markets are around as and then obviously of of lot the Matt, it's world, back you little really we where I the quite consumer But different it's I today, think, right? say, I restrictive. more Because that a not something some have as where seen. bit like depending a inflation. situations highlight upon U.S. are markets would in seen of a are activity we've because that changes other wouldn't

Matthew Mishan

or $XXX was Okay. not York, myopia of if far but for New expectation including control And what your how not, And I I'm goes? missed the okay? I year as guess, it then sure million as million $XXX this is that much China,

Albert White

anything being around currency right world. Yes, sales that's more than the out impacting I a our hurting that's The ends details. now because the probably won't us of China lot break thing all up

that on to million. giving But chance Europe when have million everything currency, a I possibility of the the right Maybe I chance MiSight, $XXX impacted and throughout Shanghai, roll up $XXX impacted think sales. think a in much $XX over here currency, million and we with million million. face get It's of shutdowns we've in to China that the have the in it's that negatively to the there. getting I'm launch our get face especially to have so in we to in that's MiSight strength to in $XXX $XXX U.S. even now not China currency seen still still of of negatively else. But the I even because we it's

Operator

Larry Our next Biegelsen question Wells comes from with Fargo.

Larry Biegelsen

Just one on and guidance on one for EPS Cook the Medical Brian.

economics And have Cook change So just old follow-up. Al, have a And I accretion from confidence point? changed, divestitures? the Medical just deal that potential And on the different update will in steps, calendar close economics, and do the deal expect starting next the you late an just 'XX. one

Albert White

that, I love with sort sold. have getting more try to Yes. Unfortunately, get things some that right to in to you thing much on moving quickly forward the give. don't We're now to and FTC it hopefully and information Larry. discussions I'd out give

outside that not much there's now. So to of right add

progress more, get As start soon as we resolution making know that to we update try to everyone. get and I'll certainly closed,

Larry Biegelsen

guidance? old Fair lot the mean enough. can of you kind to you give could EPS the And the parts, EPS moving gave new then, Brian, pieces, the a bridge, there's you of I guidance just FX pieces an give solution, that the the numbers? some of tax? numbers lens kind How on worse Can and from EPS us you out? standpoint, kind of is interest, contact much called you but

Brian Andrews

Larry. Sure, Yes.

guidance was our The So midpoint $X.XX. detriment QX to the was of last $XX.XX. FX

$X.XX. The is XX% And detriment is if you the from degradation, increasing second will, FX rates interest half expense and Fed the $X.XX. XX-XX

of So your we're efficiency solely the and inflationary as as was down the $XX.XX the what $XX.XX, from we're well revenues, likely year. and disruption brought FX exit helped higher and interest see that rate And in said to chain undertaking we tax lower half efforts lens that the pressures gets the supply the offset back expense. to care to

Operator

Piper question next Jason from Bednar Sandler. Our comes with

Jason Bednar

year. trying out looking like maybe the implied when to and for or back margin a here envelope trying bit. model just I'm the really the that from I'm the, to purely cost But decisions quick. Al for it can off there little the update we Maybe that's year, this mean operating at in you SG&A next then adjusted outlook XX% for are you do I'm I year? on make FX. Brian, for much weakness around a bit to to can down guess, been go flow through how settle here looks lost pound recapture think obviously 'XX? any and what's I or spending back quite fiscal could actions And come foreign get margins you

Brian Andrews

the a I Yes. mean X-month pound, knows, pound as is the lag. everybody

So the the we're going from some fourth to pound in quarter. get benefit

that of significant. been on to cost to pound goods. year see as revenues. nice certainly the So revenues have has weakens, happens Obviously, so impact a this has impact We'll the to what

So significantly direction any helps. right move in the

of That's driven XX%, we've you that's when OpEx our ballpark, operating integration been the Al that of fits currency. to efforts guidance at efforts. We're We've some beginning leverage more X just I we're going integrate fiscal really your Generate. from the get since being Now the in last say certainly we undertaking. the suggested. mentioned moved the around would to of faster by margin year. We've that certainly look within accelerating yes, down primarily that integration did deals

we're is integrating in quickly. some those general, moves the fertility just more that example, around going leverage Generate's then get more Costa continued an As OpEx year integrating making faster. we're and Rica. next to But

get power will the You'll put a place year. plant margin We benefit in full help Puerto in next year. That gross Rico. next

overall, constant margins, operating next a gross little at OpEx a be year on basis should should and both margin bit So we basis. currency constant up out on next of within I'd year divisions a least some currency say leverage get

Jason Bednar

I us here That's this experienced to see follow-up, as what movements And All very are expecting That's haven't a right. of then year. maybe like Brian. we've Okay. just rate helpful. helpful. interest know and seen many quick

a great sensitivity -- rate for increases on the you multiple avoid even debt accelerates the guess I is, of converting to that if is rate creates of variable has just pace rate if philosophical fixed debt further? Your here But the this floating some debt variable there that just the that change been and have years. rate question

Brian Andrews

is debt. going respect around. say, decision just capital stay down to been really mean interest we've are our allocation bounce like pay to and -- For with I now, is first I'd We're -- to rates move the course. currency the priority to

debt to the of and go paying be next down in year. take out we're back still decent in So we're the towards a in back able CapEx. amount chunk of That this will into business decent free going But cash of investing debt that half, to generate going to a continue and half back like will year. flow the

we'll And play everybody another we're out. have years. several the So knows, things course. going at fixed see billion have stay to -- how as $X for to for We're hedged now, but we

that interest moves. So rate as it take some will the debt, we down offset help of

Operator

next from Cooley comes Our Stephens. with question Chris

Chris Cooley

may. me, for X Just if I

the First, when near think term, we structure just margin about there. just

rate. You had an hydrogel just sequentially in silicon terms acceleration daily growth in of the

think margin follow-up. of the offerings to in better profile currency, we kind about the well overall the within little as myopia half these about start broader of back growth going just think So of a with And can ex just year, some portfolio? bit premium mix we the management as for as then my into CDI

the little that bit the remarks, maybe we're now you sure prepared mentioned an expected year. in Just outlook in PARAGARD fiscal exiting to in this catch as franchise. but year-over-year But the improvement for wasn't I you -- a if see curious the actual growth at didn't the

to think through the trying year. how to trend of And square as the half back that we so just about

Albert White

Sure, on let QX. take Brian margins the PARAGARD. I'll Chris. in Vision the I'll for QX, comment

For PARAGARD, sizable to year-over-year in QX. decline we're pretty a see going

remember, You QX. price in a last increase took may year we

buy-in associated that. So had with we some

seeing up decline in on strong QX year-over-year a QX comparison what be in in QX. growth to end and going QX will and a So decent then you're basis,

gets inventory back believe traffic So and even to point, mean lack is that, play we've at then in we a one this down, little things patient and here some to just What that's that, improve levels going up. of traffic we're how And seeing And the herd the we're you'll we historically, see field. the happening, at some are seen the now out in because going basically seeing of is to that's a -- point, is burned is out. IUDs. increases numbers I some some when channel that's start now bit of think right off,

into perspective improvement in will, from OB/GYN challenging just patient a in channel QX, But see a increase from comp we'll and think yes, So QX. even a start if perspective offices, we as a QX. some patient and starting then in quarter, we to in expecting here inventory improve we and get traffic you general traffic to think from certainly

Brian Andrews

the would year of in the a gross say really really half margins is else. to into the question, takes bigger mean a gross and margins, on currency SiHy. FX. daily margin certainly, I management back when there puts So Myopia than having we're on seeing but just anything look that a I you through positive is impact are rapid acceleration back

of so our And margins. that puts little gross a on pressure bit

offsets. So our that of we hit us of would the say have from be variances of fiscal in in kind QX, down of that little always first the quarter QX one I'd a manufacturing the in lines year. negative shutting bit

to going little then like quarter, of less well some going be in of business the the of with goods benefit, a I bit within you with -- headwind. be in So both is fourth performing fourth said, the really in And a from well, to cost and businesses. FX that's get quarter -- in strength

I say tied puts nothing would So kind and couple of of the are to but management, takes myopia really elements. those

Operator

comes Block Stifel. Our next question with Jon from

Jon Block

trending fiscal the of that like solid for Al, then, fiscal growth have business, how for Maybe on that talk you just It guess just I price roughly there. if right, increase seems is that bps solutions XXX 'XX sort CVI and exiting of is a the of how market to comment to couple maybe in the compares I in Al you questions CVI, organic here. can first prior 'XX. if in Brian, years? And or can a

Albert White

of to point, XX Sure. going X That's Yes, the you're right about side on XX. thing. right, solutions

And have several different that, that, you then remove a you of you when pick point. So positives. up outside

think probably the some price this but took as year. I don't prices, in my We guidance, Frankly, some have guess additional price take it at just we strong year a is we'll some growth we positive. beginning have of to mean SiHys. inflationary really the then alluded their offset I in in daily to that move pressures. market. we're it Brian you And through this of

We best daily the silicone portfolio marketplace. have hydrogel in the

was invaded And early to we be Ukraine. Russia it earnings getting March, when after you're in call there. So last did our good week growth fair, X

we our little X rates QX, probably worked markets. our year of had a see to growth for So geographies trends in that. organic CooperVision. back We've of nice and QX half in in with all through We're conservatism continuing the all the

did taking as sense. as up make we guidance lot to So a seem much even of

Jon Block

helpful And Got I'll over and gears specific fertility. that. color it. actually That's then to shift and more move CSI

Now thoughts. numbers, thoughts love call your the fertility I just but this segment. it, on your Really consumer, for solid

then expensive the of it finite on on other one that childbearing call end, So in but their sort treatment end, days. a for window individual

just get to spiral to out XX if inflation weakening So over continues next consumer control, we XX the months. of a

your and Just thoughts fertility for on what it means that particular business.

AlbertWhite

Yes.

about And a So as I on limited spot you talk seen window. of you're when anything. we haven't now, think

wants a to time enemy. when a is her she woman decides have baby, So

go you need the to You can, and trying a have as IVF go baby. in through as process to soon

of cost being cost ends lot up secondary. a one times, of the process is to secondary those the So areas is itself. where actual This

is have high-growth thing just Fertility industry. got other an industry is as marketplace. you've the a pretty an you So

that are we that and fact through so accepted will, forth. that going So more of within upgrades more and When if new number of all becoming you fertility when look forth activity coming going look common, is when so on, at for at clinics that top existing look at are on capital treatments you the on. we clinics expenditures the

of underlying industry. strong the really just seeing You're growth

well As we know, that do growth. participate so that you in space, we in

seen or to So a I think reason past. a even We've if any you get now. a right situation I into very recession-resistant recession, industry. change even a that see here moves in closer would the will recession that where the economy don't be that

Operator

comes Our from Joanne with Citibank. next question Wuensch

Joanne Wuensch

Historically, Do recession-resistant. women's contact feel you for same way that you about Ask same current the also the very health. the question answered that's lenses, just for been as environment? in

Albert White

some Yes, back growth Joanne, of the even of been market, bit and single-digit we've a been a several as back contact frankly, a long time, doing still in seen so we've I've recessions, come a Like this it I it's But kind when lens through recessions. low comes do. little grower.

I were mid-single-digit still some think of of of grower. worst parts prior kind a recessions, even in the we

underlying vision to world underlying the fertility And X/X people with They're becoming be there. fundamentals just are are more So there, just of myopic, is It's similar today. the happening. powerful. I'd going growth say, for factors in It's in XX% to XXXX. just the right? myopic correction that

visual people So to economy, need correction. happens regardless what the are going to of with respect

Now are there be terms to are but underlying or industry Or do there, any going everyone remain do even daily something people or could the buy silicones buying, clarity shift highest-priced environment. in they what some hitting going certainly of of from a in be could they buy a they're buy of a buyer in growth market? recessionary right? little great Biofinity some in type of difference be Is more to just is lenses some bit to else. Contact perspective. that There a little behavior, the --

Joanne Wuensch

stage, at put foreign And into there that that back program. question. I Are currently. don't a hedging exchange you a believe had have Historically, place? one you to follow-up thoughts

Brian Andrews

but to decision it I 'XX, delaying you're the in, business now. several ago it's doing know, that we not you're think differently, made Joanne, only and resources not We because time around it's is yes, to years time consuming. don't it inevitable. that or going your requires it's program all and But manage hedge long ceased unless costly been XXXX, instituted I just and I a XXXX

expect you're some of You're you something, hedging -- time what period time. ahead if of to know

up it to doing to operate it. not or the worth So being from or unless we're ends worth not ends the cost just it the -- time change to the being way that hedging, do going up going we're business effort our

that it the now So where and is a a it'd yen in everything probably kind hedging. is is of place, time to be start horrible bad

a change no here the get direction. still quarters. Of bit there's bit a there's of continue to of relief go But course, we I'm our strategy. going it go Hopefully, not could little be optimist. no, the over to -- But an to couple -- any in wrong next hedging of

Albert White

add, about working everyone about which forth But it loss and script quick FX that in talking It made we the through statement our this know about and came reconciling the and thing and of income and talked I expense. and one, Microsoft the that April. on add in I'd so saw don't today or Yes, interesting impact not. that things that same the and was were a was as we exact if month saw from out other just the

it know other it, had happen. will and same don't I today, but thing the Microsoft So see if announced we people

people. other if So surprise it you it won't see from some me

Operator

from Our with next Baird. Johnson Jeff question comes

Jeff Johnson

XX% the XX%. I always time of of Is companies market kind companies? I'm It's a kind you're to the understand just for But X looking data by number to growth looking rates. not like at that at QX, market go sure getting to That kind in QX, and this that's that talk right? make X end CLI calendar this. you growth want guys XX%, for when about you I market or the assuming you of

Albert White

right? of CLI growth you rather market, it's has data. data will, net -- true gross Yes, the than if Because

GFK capture that it all discounts market, whole and into So consideration the doesn't kind of take doesn't stuff.

yes, look just I tendency have reporting. actually a So is what company to at

Jeff Johnson

talking and they Alcon kind agree. was mid-single-digit I when in I more for and were think growth, the their will, more in out in Yes, of, sell about market? was distributors at CLI to and market you if guys to you're the or looking And like sell you that quarter would GFK end looking

Albert White

Yes. correct. That's

Jeff Johnson

Yes.

daily you're point, quarter. this even that XX% we a number, than on and little your stronger SiHy then here expecting And Okay. were probably

think there. hearing like holding in guys things chatter increased things PRECISIONX you that, but to well seem of around we've be like a and little I bit been

these with update of competitive you're just some kind especially with of environment, from products the Alcon seeing out but new some others. So rolling especially

Albert White

Yes.

-- and be So I of guys legacy Alcon sure, time. big wearers I'm well, that they'll be up, really portfolio doing They a long have think of some they'll those well. up, for is trading a trading

legacy of remains same to us, have degree, our new we're large trade fits. kind story certainly is we of the the some up. winning But fair as that which portfolio for will, if think I a share to you don't

winning products fair wearers differentiator. into our When activity. that new think the you're I fits, market new and MyDay about the you're about like share certainly probably clariti, we're So and talking where coming that's of talking new fit

really to from the much legacy us seen, of It well good which well. can't continues for lot where I've up wear. a trading growth thing held latest sign on So up really that's we We from. hold get a I based data think up the that's as our that's frankly, is because, to need get

able the coming be to have into wearers new win we to market. So

Jeff Johnson

I've $XX still seems now. myopia. maybe on And those got one now just $XXX where for thinking MiSight on those about rolling or at I've about the MiSight? year-to-date the of $XX just X you at who you It into you MiSight million $XX just at in going year that this of maybe to side? talk million you Where kind the wearers macro million. short then okay, any seeing feeling million from understood. over dropouts the X.X the established on I about then you're stability are And got of of of wearers like are the now Yes, last come are But on hear MiSight. -- kind environment

Albert White

for running it's just wearers. team I the numbers retainage had of the was little XX% if into on XX% going update multiyear. Yes. but will, MiSight geographically, a rate, kind different the you to And in it

that yes, million upon a which $XX and they're what I'm the happy past, from kids a So I is really very in change expecting great number this year, depending report, news. not of was kind On lot for it's to MiSight, which then And significant seen lens, going of including still Shanghai. mean our million million, distribution through literally We're ahead wouldn't $XX $XX China. be to to I should of to farther with activity that in to happened uptick I is we be A China. ideally. get to our million. some range what in activity, of lot some change working million in right? $XX to $XX we've we're need staying the going of

Shanghai certainly have in shutdowns the hurt us. So

be. and there really Now It it activity that stronger was launched China in we I in to than first when going strong. was the definitely was thought first went

received you then it shut sudden, of really all a of kind will, we And if itself down pickup, some So early here. there.

last started a just reopening bit in kind the day or of Shanghai Now X. little here

million mean improvement. $XX if But decent be still be in comes if we So a I million. a market on kind activity. I to get at a that get $XX up rebound and probably to million ortho-k But think least mid-XXs. somewhere to hopefully, the we'll maybe some that, up we a move back little million lot that have that get chance $XXX I could we of we'll snap China I I because in think towards bit pick of we'll think still still think we $XX

Operator

question comes with Jefferies. from Weiner next Zach Our

Zach Weiner

the switch one on from out Could Vision performance some business. for you parse Just gains strong the of the Care new versus fit fits? share

Albert White

to, love no, to incredibly trade-ups. would of difficult I get but it's because

basis, to on get global when it look at round and you get it's viciously new So switches so when fits and of you in how all trade-up a activity And classified and gets terms forth. into. difficult just

to we're some hard of it hard certain certainly as would I I and I like only when it's new from that's comes granularity. torics in numbers. mean fits, in see partial you'd level to seeing places, and doing comment, We're data that in multifocals. get and kind to you'll of strength. but we're say fierce, even fine a But doing see that stuff it's think those well get GSK really where it's but especially general it markets,

Operator

Our comes Blair. with from Andrew question next Brackmann William

Unidentified Analyst

view This a set dig line. of more bottom ourselves strategic in. is better the Mike rate just you the how expected to what to the spending you and Andrew to you environment Can will this a on sort Is do we here the bit? find spending on of given from us just backdrop? comments today. back level FX Maybe a headwinds little to pull that macro sort bit your little on interest around balance impact the something for in you just standpoint in Or do cause

Albert White

space. spent Vision share fundamentals in are our of It's bit We're a question, really Yes. quite ended I right up through business, a mean that. the time and the good hey, strong saying, the Surgical of we've thinking We really Mike. Vision taking of now. got of med We bunch fertility, medical and gaining going got parameters. traction some good launching a our we're of products. a with products devices and around and expanding some world We've things We're device. lot international great on

and It's the off looked get it of the said, you hard to man, momentum. to pedal. at foot kind hate we So take

it. really Now keep that have we momentum, want we to

year-over-year, cost I've stuff invest? I exclude different can you're we on up do right? chain that different we efforts I've all lot Can Can to my momentum hurdle we even situation kind inflationary of and invest that partner, want pressures initiatives a we everywhere supply here. without stuff? also else, and a well, And a ended everything have up you exclude we pulling that right? continue things. can't expense we then of growth everything of interest So positive net we like, we okay, okay, pulled and Can pushing that FX business? And where But interest side myself revenue. some out FX rate you saying, got we said, we if in and out as opportunities margins out if solution the price a factors into got to the the get got core my growing of and cutting are can and some hurdle my increases containment we've want I that yes, to are will, and hurdle increases, of we there. do kind and

separating fundamentals FX. interest way it strong the right to we We're too saying, the ended going hurdle the up now. of hey, in that's not the the are business and So to ignore

FX other years we're way, the or in back. along prior that FX mean, Now to goes when going maybe right unlike or something, other companies just I pass

soon, sure expense paying hope go said, to going sometime into our going as right as to do, is numbers. debt Interest happens I Brian So that we're will right? do back focused now. it's on right down [expletive] what That

help to kind down thinking, flow debt and to year offset But half going our cash will, pay we're here, this that if that. year. So the to strategic of generate back some you next we're for into was of going

Unidentified Analyst

CooperSurgical really you up tell is was team more. And those some anything Is mentioned with coming could opportunities? us maybe potential the Al, that the the acquisition. specific there helpful. then during synergies That you of Great. on one integration Generate

A –Albert White

work areas. you Yes, team, device stem a one have regenerative Like so incentivizing that if includes Generate cross-sell, them to force labor medicine another sales teams And example. sales strong Leveraging the delivery and them a to help and and through OB/GYN then which from very delivery process. couple successful. forth will, and to medical We’ve in and you help we be the we of educating are I’ll together a give business and our what group. an have cells cell within to labor and stem on more worked force, that

and force, force we positives we’ll as see positives we, of acquisition utilizing the all Generate "if So through through training some activity. the the sales move And I And think from continue that by activity. will”, seeing from to back accelerated year, already. half our We've worked we increased our I existing that you sales that. that think we’re

So kind to synergies talking to of the starting that that we’re I’m and implement. about find are those

Operator

next comes JPMorgan. Our from question Marcus Robbie with

Robbie Marcus

give due to about maybe for Free How deal what hoping was us How the weak cash in integration? of much cash flow I came do we is the flow in a free think drove currency that. sense bit of the versus a quarter. balance year?

Brian Andrews

Yes.

the free interestingly to milestone We a contingency a was Vision that by of cash. SightGlass a mentioned cash tied flow. revenue million outlay. We milestone. impacted negative settled operating to out $XX outflow revenues, and of I It cash cash $XX a bought So a million was

and hitting that remeasuring had OpEx, so it calling been was was last in OpEx. out as contingency And that were and we remeasured being that we year,

detriment. as help to ends the by from out, getting being payment XX% support joint it And the so venture the paying payment, of up more of Even though, when now money a that of we the part than the them received SightGlass -- part way, this the from buyout. and you're closing it

inventory it. that of cost tied was that a of shutting cash FX costs ahead then got things. materials just purchases you've part just raw big just Obviously, down. some And and solutions, get So some to trying to higher with and lens

up We've trend for So a of cash one got inflect that just back our and still half CapEx million. QX was of in free expect things flow being of of in $XX costs, really all utilizing to our is the little resulting bit the in But start really now. where to strong is bit With going all and lenses a very strong demand right expect year. the really, amalgam those The CapEx an little equipment. little higher. we're basically idle I'd

and So we stay want ahead make that buy we to game of equipment, we're sure the and some putting production. into

-- solid So still of see see the we flow up really looking back in free of at year. the and the out the we'll come and cash is to half do as CapEx end continue year you'll that, round but

Robbie Marcus

just follow up. Great. wanted I to And

board X% it Joanne med but the XX% who the about expand significant line FX in hoping was on we're asked what before. is seeing by question think impact most And that a is of kind could it hedging was little tech, impact probably top I you a seeing. bit. across we're I far from

I you, as your when reported? plan guess, currency guidance, out you And risk to -- do are you about or that FX how time? can you how hedges set offset So any just you for think over do -- do in constant natural a business? the it Why leaving

Brian Andrews

to hitting P&L, our this yen unpack. But do that natural this story have the revenues. offset of the that's long moving fairly but to is do have have the when quarter -- we from -- with really that. just But very the and been we things. Yes. grand what's at yen and some lot in We impacted weaker, insignificant little question of you even to hedges in story the scheme last short quarter so there look good they're euro when throughout pound a and of business, Robbie, you sort significantly moving a was a

Our OpEx very, is very in low. Japan

significant. it's and immediate is flow-through the So

currencies. to the -- and throughout last the delta Europe majority So -- the second from We was mentioned from earlier, guidance this we about Al $XX sheet talked big of quarter's guidance, from of play $X.XX today as they balance other experienced quarter's and that that impact out And that stemmed that -- million Microsoft as in just have stuff. intercompany. quarter, mentioned a

that was pluses or we settle those you are loss you majority big measuring the in to -- the impact bottom up part one a -- were towards that But of the significant a month the You're basically there. quarter, have a and XX case, going doesn't balances might always result -- large to trade and And every typically, of because very intercompany in days. the balances minuses. line There that end $X.XX. from this other, made that of you

like get. guidance, other is what you'll to And I we to we've sometimes a in setting said apply before, so against big When in favor, currency be look said big roughly past, and move take you sometimes and that will our favor, positive basically our currency that's -- we and in us, just When your move at and a impact try see to the it a starts our the moves current way. rates, we comes forecast, to it you.

we you headwind. is And so tell the that's what

the at -- arrive any isn't magic we that's there how it. It's So guidance. of kind around

Albert White

The that's Yes. company we're being that terms large misleading the every that between other delta. XX% to that. X% as abnormally in point on and Robbie, the add that, of because highlighting same a delta you're

is from cost later. from capitalized our within through lot of our us differences inventory the FX it and gets primary months turns of a One X different goods, companies of

of positive pound not and right offset only within get flowing negatives a all bigger seeing the basically All change fiscal our our The pound. the inventory. that's sudden, getting OpEx. we're from the now And we're from starts into year. coming of is any the And is from next end the offset through the So manufacturing of at you year when currency. in

a X% year. fiscal all within the it's it's happening and because So happening XX%, misleading a that's little

a it what over year, If that to from would be companies. similar a dramatic full very difference. it It wouldn't other you be you of out stretch see

Operator

Our next Steven question from comes with Oppenheimer. Lichtman

Steven Lichtman

second similar chain comments Just, helpful. I that on see you guess, much bottom first front, year? outside generally supply you And how impacting inflation guys of the the solutions on to half this would better? Any do line be are business,

Albert White

Yes.

little challenge that, a the and an is Solutions us. but bit been forth you and need so impacted with about the has no made us. different for that solution purchase a for to There's definitely progress animal bottles that it, We're that's forth, on plastic working we've some and so actually question of through that.

Now of down this end we're the business shutting at year. that

to trying we're our So care of customers. take

I in we a decent operating QX decent did that a We did lose. from in had business. loss have operating loss think QX. We

hold we revenues we at QX the probably we now of in because a supply then customers. like and as stable things we're that as think to And rightsized I where will, QX, you kind working we quickly to in if much of made infrastructure, no rightsize are and or decision very is QX. as can probably profit our neutral get operating out to QX, operating profit, fairly

Steven Lichtman

tax the year? in mentioned guys rate are assuming Brian, Okay. you Got What as it. for now an you guidance offset. the

Brian Andrews

Around XX%.

around from So coming down around XX% XX%. to

Operator

next Our Needham & question David from Company. with Saxon comes

David Saxon

on MiSight. CPI, X with Maybe starting

And in how MiSight environment? a inning, wondering U.S.? trending you Just what thinking you about in are for pricing are potentially recessionary the MiSight

Albert White

it Yes. the when we're concerned, inning first still, comes as I'm MiSight. I mean as in to far

large on early mean a of have And be expanded number coming we're management we very what marketplace. is myopia to just the just I additional products going are MiSight, We in very a MiSight. range going parameter to out.

about excited I'm So that.

grow more manage the just and is grow. R&D I to right can out industry their anywhere see what within continue they how now to going everyone how they talking you're think going that continuing You're products management, build ophthalmic means, And and it forth. it it to to about so space, within practices, myopia coming expand go because of seeing you

kids care disease. this eye thing, seeing and benefit way everyone. a hey, I and that can I saying, to can exciting help have I I tackle help society this treat it's you're can practitioners So and

some So there. momentum we're gaining definitely

up not pricing. taken early very, Pricing I we're we're spots bit. process. I haven't changes mean, pricing me if made think So very to we've in we -- in around the in little is that that some a anything, world,

in right and doing We the fantastic strong FDA-approved it's contact only the works, a as lens. that have a product out market one that clinical there that's now

from with think now, where I roughly we'll So our continue at. it's right pricing perspective

David Saxon

call did products. you then your out branded the And helpful. That's Okay. in growth -- your

or wondering, are just new anything strong you seeing growth? segment if just branded the in account that's underlying So key

Albert White

We're we our bit so of -- customer Yes. a talked lot a you forth. solutions, more customized seeing for in was brands the that more recently driven about will, while being of by and growth shift little We've here. the a of seen if

and forth. if products, the products, MyDay, a private particular, Some seeing Biofinity from multifocal strength we're practitioners sold A which so you in of of some branded lot the will. of lot gets the traditional that, tile, of through that torics, more also,

nice It see. I'm really that. still that's really doesn't really So sign. but see to a surprise happy me, to good it's

Operator

White to time, the closing conference you. the at like hand over showing Thank further back I'd in remarks. this Mr. queue. to And I'm questions for any

Albert White

call. today's operator, we Thank earnings next updating forth on everyone, call. everyone thank September and so Great. for look forward to attending and time in again you, and you, appreciate your And our

you. Appreciate So it. thank

Operator

this you gentlemen, participation. call. Thank and Ladies today's concludes your for conference

may You disconnect. day. Everyone, now have wonderful a

The Cooper Companies, Inc. (COO) 3 Jun 222022 Q2 Earnings call transcript