IVC - Earnings call transcript Q2 2020

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Operator

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Invacare Second Quarter 2020 Conference Call and Webcast. After the management overview, we will open the call to questions. [Operator Instructions] This conference is being recorded Thursday, August 6, 2020. the Investor to Relations turn Director Lee, now Treasury, of and will call Lois over Invacare’s I Corporate Communications. ahead. go Please

Lois Lee

Thank Sarah. you,

slides me our Officer; from President Joining Financial Officer. Vice call Matt will Chief today’s Chairman, be we pandemic. Monaghan, reviewing on to we President Invacare and and our response and quarter results providing and transformation along, Kathy webcast. XXXX and are Executive this follow investors Today the Leneghan, second accompany our To COVID-XX financial have investors created Senior with an Chief update on help to

For those Further our information can SEC a invacare.com/investorrelations. webcast found be link in our dialing to in, you can filings. at slide presentations find

may to their Before company results about Matt to the begins, and address like nature of may second expressed today uncertainties note and in I’d release. uncertain. I in we forward-looking quarter on included that various differ statements make the our earnings you due to refer second Actual webcast cautionary slide by that that call statements matters are statements our from our future materially those page today’s during the

to earnings such call of slides posted our sales, flow, be today’s the the considered the Matt in Monaghan. the in website. items and non-GAAP now see release and explanation adjusted currency reconciliations EBITDA of related the constant adjusted in webcast the to in notes in slides I constant call are financial over please appendix that turn our will an For currency discussed SG&A, cash information, as net to free loss, net

Matt Monaghan

morning X. to Good We’ll everyone. you, Slide begin Thank on Lois.

keeping who committed call my for First, gratitude I’d these and all in our safe expressing remain associates by workplaces times. in productive to uncertain today’s like so our start

has individuals inspiring part and of our everyone the of focus on world. of make be leadership, the and to people of accountability the the mission inspiring. an creativity hard their work, daily central in experiences products differences helping and who integrity, company on built our the lives. company a We life inclusive benefited differences culture tenants around possible, been from of whose their dedication diversity team, rely Invacare’s As is is

pleased our XXth our in consecutive quarter, to We’re as of EBITDA adjusted quarter. well second improvement We the cash improvement in effectively and as performance cost with in EBITDA achieving shed from offset year-over-year quarter sequential first managed sales. lower adjusted

tremendous these extremely products, pandemic-related our supply During our the products primarily for respiratory limited chain related overcame are high which demand used which quarter, the meet to we to for also challenges ability care.

fitting, strong Turning to XX% and this which the highlights late saw demand of in respiratory concentrator. this sales a our result part, demand for and limited strong the momentum in demand product both and result first driving delivering bed normal At from for the mix, early in We as second had mix expense. initiatives systems environment, most had bed that elevated for saw demand savings X. to in peak established access has We’ve X. distinct continue this be That passed. timing parts a slow The in portable rate an SG&A sales. pandemic. profitability, as the patterns of margin we return seating, to challenging smaller I’m pleased in record improvement health for to a today. track our from enhancing changes the profitability The are sales quarter, first demand on make. from grew still quarter EBITDA. custom for these improvement We cost and performance determined Slide continuous gross Slide we began groups of adjusted reduced category of point, restrictions oxygen public takes here. favorable as in continues pandemic On Beginning peak reduced mobility to strong based quarter stronger category. two in the of in which quarter a more lifestyles of our to that the good the clinicians course with stationary we In value

a restrictions loosening encouraging for most demand as improving we see we as in will we coincided over two of and over ahead, health renewing phases In the sales year Based summary, three Looking quarter to to will products assumptions for quarter signs rates public to facilities, believe begin the seating quarters. second mobility the and quarter starting health and second access are quote third numbers. it the to recover low sales that be normalize lockdown. point is the the of the restrictive with care reasonable around next global on anticipate order

return portfolio, sheet We’re balance enable the and our and confident diverse that coverage, will our to business product pandemic growth. to improvement initiatives accelerate geographic continuous the through us manage

Turning X. Slide to

working. our is show results quarter transformation Second that

North generated market. to returned Importantly, million tough in unprecedentedly income America an and in $X.X operating profitability

As related a national consent the has the undergoing competitive reminder, to of transformation a after multiyear FDA a decade ago. bidding which combined profitability decree, segment nearly sales the significantly North and been reduce starting to impact America and sales restrictions

both drive IT good America expected plans, of our our make and Germany, business of are continue plant In optimization XXXX. significant consolidation progress in program savings we modernization to which North on terms cost in to in

pace products schedule, the to and vibrant As the we to to of strength. it’s important our which products develop are proud and and of have staying R&D highlights on pandemic R&D innovative growth, keeping new pre sales team pipeline, track launch drivers a I’m at do. same the key new

growth wheelchairs, their have have few past market. the in which three quarters, all major of Over steady achieved the launched power time short in we

quarter, MPS for Maxx U.S. small III eligible This Group reimbursement standing full we for within the capabilities which category. launched Mini wheelchair drivers, another, is with the

we manual launched one, a a Our great new launched need, sophisticated America, in unique continue innovation which wheelchair add-on wherever for produces all Adaptive July, full well Switch Europe. health a All in support SMOOV durable already will Labs growth power great And highly achieved as controls as drivers head success solutions. the for which division, terrific pipeline array. people in North alternative with care these categories wheelchairs, of has in very need products to

has Europe, customers ways the online upgraded few our clinical developed website. perform progress choose offers our pandemic, guarantee, wheelchair program LiNX our technology. team commercial to just us Invacare and and customer presence I’m years. a safe team and ways leveraging The a our the complying challenging over found customers power visualizer confidence maintained our system delivery, of support sales we’ve These continued skill wheelchairs with creative well helps are ability During the we public fit visits of restricted. In new transformation launching on to the assurance drive circumstances, our to product a giving the a are catalog, proud telepresence when by contactless wheelchair control digital to our under a has high made measures. and while a past execute health by of engagement many

I’ll is Kathy. Our culture powerful to growth. innovation adaptation over turn the call now enabling and

Kathy Leneghan

Matt. Thanks,

reduced seating capital the lifestyle decreased than to profit mobility benefit and non-bed X. driven by enabled by higher and sales mitigate reduced gross net a XX.X% Slide impact cash and primarily of of decreased usage offset Turning expenses, in of The percentage programs more net SG&A $X.X Adjusted currency by products. SG&A and to growth up XXX by government-based as decreased respiratory unfavorable Gross company’s and flow was increased and cost and furloughs by and and million, XX.X%, reduced points constant work $X.X driven offset declines basis profit Reported sales XX%, by sales was included EBITDA favorable employment or $X.X Operating lower Lower and an by loss million lower expenditures. restructuring foreign improved million, to driven costs. free driven freight to nearly partially hours of expenses. XX.X%, currency the pandemic. due by million, SG&A the $X.X Constant sales. net primarily increase partially commercial by lower employment $X.X expense offset higher cost mix improved exchange. XX.X% material due costs, product to reduced million, in

Turning Slide to X.

restrictions the consolidated elective Matt and health mobility professionals seating. and discussed, to that due access As with on sales public health impact limited care net greatest care, to declined

the and growth sequential in second achieved mobility quotes third the seating of the quarter in sales orders company expects run have and rate XXXX. as While net than the declined, quarter higher been

continue a Within result to lifestyles respiratory, lower of category, long-term product pandemic-related as capacity. access infections elevated the systems through demand other offset challenges, oxygen possible limited care The sales which were sold in that the demand lessen. expects respiratory higher both In bed market third limited sales institutions, home products for company products facilities. lifestyle the from to realized by manufacturing COVID-XX company sales but portable stationary with quarter, including higher care health of clients and concentrators, of global by care it’s chain the supply for dampened

Turning to Slide XX.

second company’s the strict sales were primarily and in Germany. European negatively net During the quarantining key by measures UK, impacted the quarter, France markets,

included decreased sales net decreased Gross XX.X%, of of a points, the sales by by Operating million unfavorable and in a net partially expenses the XX% facility. product majority a $X.X offset on by basis profit SG&A the foreign decreased declines mobility Europe profit unfavorable locations. gain to reported furloughs at driven non-bed result, expenses currency reduced and exchange, work products. reduced the a and XX European and driven benefit lower lifestyle and hours decreased of in and gross due income As constant net sales sale SG&A Lower German reduced in from sales seating mix. recognized implemented

segment XXX operational reduced end with driven result income product a expenses million, higher elective users more America SG&A driven care, of employment of to $X.X transformation primarily by mobility seating lower profit an improvement decline acuity while were in operational down. or never with company higher – sales declines shift seating, U.S. mobility favorable North XX. compared currency products. in not more pandemic impactful lifestyle and impactful The not and segment growth mix costs. a Slide operating favorable profitability initiatives. products sales shut and costs increased X% health more was of and $X.X North by less by offset of only sorry, mobility benefit Europe decreased as $X.X to urgent constant experiencing The needs value previous material points million, severe basis of was slight America to and primarily non-bed X%. continued towards costs access X.X% net the delayed. a realized power net including as fully and to costs, products respiratory as was Moving in resilient, the as products the was mix often returned in Gross as freight care with and decreased as lower reduced America Reported North million, Within The I’m than

Slide loss Operating operating Turning SG&A $XXX,XXX, to and by seating in comprises X.X% partially expense. higher primarily to sales XX. of and Asia-Pacific corporate lower currency expense a other, region, driven income by business by related the by increased higher basis, improved increased on to Asia-Pacific of in lifestyle All SG&A which the by driven constant sales equity offset attributable products. compensation, mobility

Slide to Moving XX.

$XXX used As million of company’s Dynamic the proceeds $XX.X result $XXX cash of sale the partially Controls extended the increase a XXXX the maturity June new XXXX, had of At XXXX the and convertible operations significant a convertible debt programs, convertible on to operating the terms sheet. the from XX, of XX, debt. cash note sheet. primarily million, November quarter, of similar balance of notes. total and of XXXX fund obligations maturity portion second end with extend portion by quarter, date the to balance company note capitalized the In company million of existing paid substantially excluding of company had the the cash cash of its and the portion borrowed on the loan the to government of was a approximately offset the on facilities, The lease to credit of

EBITDA in on range Based public net to market. care this XX, On have similar $XX of turbulent sales in million to net EBITDA in America, the below programs year stringent below guidance access year of in the below for free health we with loosening be for improve call flow million. results health company are range I in full expected the to prior the the executed Slide year the to net mid- sales reintroducing prior lower pleased usage staying and very to during the prior are sales net low to is to to slowly, line million digit transaction a declines. key consolidated sequentially, the the Due are guidance sales renewed new teen cash prior restrictions the anticipates staying to the Europe, of expected to range improve turn range single and $XX the of reported facilities, achieve of markets quarantine full are In XXXX. in expected the $X year pandemic. North $XXX XXXX to the the range million Adjusted the will adjusted to recover year year to net declines. This in assumes over in similar prior $XX year. of company’s $XXX Matt. more back despite million, and sequentially due to million the now sales We

Matt Monaghan

business associates of good the a This resulted these in our unprecedented customers quarter a significant in times. Thanks, acted tough impact in achievement pandemic. protecting near-term in continued profitability, a the of our It safety to Kathy. time. against while We decisively the ensure and improvement was

further I the direct value result the taking I’m a competitiveness, work for of and our was for result sheet to time of Thanks questions. continued our quarters structure morning’s out, we’ve plan team have the for taken many the improve quarter Invacare this additional this look foundation actions As we long-term of Sarah? take come. support to profitable that and hard and strong balance to It confident that years growth. enabled our call. deliver your now to reduce We’ll set cost unlock our to strengthen for

Operator

and question from Securities. first take Labick ahead our Bob [Operator go CJS Instructions] with We’ll

Peter Lukas

gross – on margins Hi and the…

Matt Monaghan

morning, Bob. Good

Peter Lukas

Good for Good Actually, morning. it’s morning, Bob. Peter Matt.

Matt Monaghan

out you question second. Could a cut You over? for there start the

Peter Lukas

I question Sure. gross just on a had margins.

also and the by the how next Just North over much where could talk savings you months region, XX America? just see if opportunity where maybe you region X, you see do part about cost the And room in you specifically opportunity. have by

Matt Monaghan

or think Good general, and be pandemic us. care Kathy the also. Peter. in then for consequence elective which bit more seeking margin Yes. A we’re complex doing really accessed comment kind who need tends questions, I health people more weren’t of that couple of And Interesting things of complex can a was still optional that little equipment, those care, higher health care. cases to needed

So going generally pandemic. margin And pandemic provide resolve clinical during progresses based we Not our consequence pandemic globally of on the the had addition, end clear when really that’s more the here. gross in expansion as products use valuable to a users how new from to and customers.

course, of So of of offset be our margin with reductions, persist. still we’re work that’s to plan. going that there’s some gross to at mix which going to all cost it that receded a long-term mix, continuing if to to due normal And part are more

reductions. gross there guide So percent on margin gross you out said that wanted going in pandemic we I some marker that during wasn’t go, mix the North result can on little relatively advancement of would a of in where based know only really bit set a due between margin And that the don’t to it’s I of was to predict is difference precisely to that product say a to the and There but to America I the favorability as pandemic. hard ongoing Europe. that, cost

previously to Kathy, indicated we’ve German Europe, slated which be... plant consolidation still value our think, Now is of I in the

Kathy Leneghan

$X About million.

Matt Monaghan

ago, terms much track quarters five of we maybe pretty which roughly. million, the to day $X in announced That’s on implementation.

of well. in in looking will revenue that IT definitely year place P&L America Amazon-like will with, overall So of we XXXX, be for of We we which to all business easier the much improvement that the really company. for. and tools to lots haven’t with The that the should inside do predicted then very drive North should XXXX, too be come that’s we’re the accustomed is conveniences all profitability and see and we’ve productivity as what synergies, both at hit consumers, end this for

for Did XXXX play what’s you, help Peter? probably material really today’s that’s beyond So in that and guidance.

Peter Lukas

on from expectations? Thanks or on update And product Any the in of one timing great. launch just terms more the upper Yes, me. new respi,

Matt Monaghan

out fantastic a with new product expectations the third quarter. Great coming in

well remotely. we’ll So debuting that so many It’s surprisingly shortly. pandemic the progressed in working here pretty with be people

respiratory It’s during is everyone line one out congregating people the questions around new was: any no out the remote line team of around collaborating have or And figuring product fantastic. work. entirely ways normally launch time with ways been designs? had for on launch change innovation innovative. period, does this world in to And to think the new you the great I our progress fiddling of products. to do of prototypes figuring being be and how and parts when we’ve accolades Really, the time despite

Peter Lukas

you, again the Very congrats quarter. helpful. and on Thank

Matt Monaghan

Thanks, Peter.

Operator

take question We’ll our next Stephens. Osborn with Ross from

Ross Osborn

for Good on morning. on great quarter. Chris. Congrats is This the Ross

Matt Monaghan

Good morning.

Ross Osborn

and your Can in Europe down prepared that America are more be you and elevated as rates mid-teens remarks to are a be order you I down Matt, said to detail globally in the you seating sales some believe by noted mobility the provide for region? whole expected North XQ been low versus XQ. digits. in single expected have

geographic fits So seating how be and any more great. could on color if you the kind that provide of trends, into would overall mobility

Matt Monaghan

amount out different sales to turns access absolutely our the it’s understandably that responses by pandemic, social or therefore, different color. Yes, public It have of maybe care, affected predictably has country. of different give circumstances we’ll Different health which some to and products. and countries

a have start of of like the access a of and early and UK, care in be certain to in improve. get recovery quite to because kind economy. course, health shutting downturn and the And the after to principally, Italy Nordic is had down Nordics had other lessening unchanged. way by of people impact significant has as early started I elective part imagine – be that public of health getting And separate surprisingly, their If their they kind terms are different would care. Germany acute the country. turns economies – in as restrictions where end and latest closed things you’d continued it in very the our to was and of Spain from with the of the middle, spectrum, And very the were out we places markets So delivered Europe, their at care the France say, there of quite maybe tends economy.

our they’re from one the very public to someone go get not get about with going Norway, generally people is So of get as to or being COVID. different a products in Invacare if care. therefore, with And of those wheelchair needs Sweden to someone products fear to let’s go a for exposed than to COVID might say, physical to going location concerned

a change. So whole spectrum of

as We particular It’s America, don’t explained, states And in different a it’s in to of return think I look been do see exposure rates in I Europe to pattern a see – say that. it’s signals months or us kind want But for probably what’s the total. thing. of to improving aberration bit. month quotes are just not mobility state. that across one Well, in short-term. and we North the country a consistent any important I’d a enough statistical have a we see We indicate little then by order same has at of the country. to

month improved her three help? kind order two in us that and into in the to sequential for mentioned North we’re to that of which than Did kind growth more Kathy quarter quote gives – the composite. So rates recovery America, look remark. you a the confidence and at of And

Ross Osborn

peak assume to on regards for And sales issues you And the remains you. throughout been full have how with there and respiratory? we pandemic the then company’s Does elevated year QX color then year? the the demand chain Thank progressed just guidance that to kind lastly, in one the expect supply just additional is? Thank where given the kind of of of respiratory. rest And there. should Okay. is more

Matt Monaghan

that hard is have that trusted for peak We’ve customers in respiratory questions. Good to the around us urgent Yes. which very products, COVID help high clients world really continues those it to both pleased demand and we for really their calling devices to Calling the patients now us with and pandemic, portable continue. products stationary for do. and expect symptoms, the is their or been with

Northern think rise the are: Hemisphere and as we’re to major terms in and going revenue. – rates incident internally questions I pandemic ask economies predominantly, to and the all in a externally of company continues we’re

continues would get for we all elevated, winter there is likelihood to rate As oxygen have of elevated some demand lead months, us we incident which be to that, believe into that concentrators varieties.

the is than a now, I continue a time. obviously that going that where no for go to better see there in to there potential. So pandemic is can’t people, we elevated is going And is but abatement for demand. call some this other chance

May, the when suppliers, in on those industrial They’re the In was Europe, lockdown And a United to deemed looking the resolved. we close terms of components and had how hard in March all global states had into certain imagine operate. businesses Italy, April, out where you and components from figure that’s and started second in to issues, States states April supply world. been getting demand, component we we the if and over could businesses and from to other our we chain our this quarter were essential, across challenges Asia-Pacific. and weren’t in ways But as had that fulfill there or it component in got coming to get they’re

every company to a that logistics in knows to So world the the has and to cost logistics problematic. keep And sure it make those more arrangements very that vendors that become probably and those we special get entire product could components produces during open to pandemic, cost make us. availability had us

and much lots product. of less, few I still it day make every XXX% week. dealing from we there but of we are manageable try things had still results prohibiting people for coming small to think have out army of We’ve still day like A nuisance team put it. day. it. the as while we on great it’s a every problems elevated the than the we’re that’s And now, us to working on got are meeting we’re with a have very but or we that We zero in it in of are could a that still things problems components the every was, quarter. results certainly as not with turned that had. this the demand takes respiratory easily evident. So a given such for It working had more by components a that good immediately respiratory And fire was we It’s amount maybe early, that windfall

hats team. the So off to

Ross Osborn

you. Thank

Matt Monaghan

Thanks, Ross.

Operator

question our with from Matson Mike take We’ll Needham. next

David Saxon

This is Yes. morning. Thanks the questions. for on Saxon Hi, for taking Mike. good David

a this… Just few

Matt Monaghan

David. Hi,

David Saxon

Yes, hi.

you Just the any reduction that EBITDA? of the after can quantify some that And leaner temporary you about could initiatives. are When allow a to on morning, are think company cost then the there cost pandemic? benefit just to more few durable the become this them, reductions you a

Matt Monaghan

Yes.

of reductions, it’s durable In interesting. terms cost

So – certainly, less everybody salespeople productive time. that more work productive wheelchair has we go the P&L – it’s whether found that because new to are whether be it’s they’re from spending down home can ways

getting physically we’re and customers make should and kind more that had. found of persist. try customers will on money engage like we We’re useful to are customers activities customer airfare of that delightful together spending do persist. that certainly training forms to not for end-user convenient other more more think And going engagement for ways And durable. to to Certainly, we or with we maybe

or And tariffs, at other should quarter-by-quarter, to look we On eliminating things the at to for some side, the stick. chain allow and supply very exactly supply bit to has this that to margin. chain work dollars. produce margin we most we’ve that improve keep stretched us enhancements find probably And against better us. final gross those improvements. of time. to make remaining the this work been are continue find we And right, That you’re that period, a to ways everybody XXXX gross as we’re got solutions And during durable all going little continue

the some reductions based. of Now are activity cost

volume reduced of we So our as we’ve the seating down like variable mobility, and products, some went in about talked costs.

some come variable And costs of as those back increases. volume will

costs fixed Some in of nature. those are

have spread cost XX% at gets over at the is that You whether XXX%. or facility working might a facility

in a will because So what manage to cost we’re of start those of But go invoicing, much lot course, then based, back. how sales a activities do collections, SG&A, customer commission that, fewer is down which lot down up. that’s lower. make there’s when selling are going And payments ways your snap activity occur to accounting, go try to productive G&A we of activity those come reviews, things found to will like with people. And

next which in to as do to predict pressure to don’t to activity two we’re how cost elevated is are. and keep favorable those what increase. back, way now to there’s have try So is And going that sales right for sales those be you’re try observe just those to that what a to savings likelihood right quarters much We of could durable going incremental down as to we a planned. had recover manage the three to the comes

margin world. the to as profitability the this for that us profitability about talk is goal next our to and So two we’ve to the helped programs three maybe as around close maintain have quarters same Kathy had. keep the And can

Kathy Leneghan

down employees Yes. assistance as Europe, QX, lower came our for work volume the the as so of the we many reduced take to company, of Primarily, well in furloughs. hours advantage were to able in as governments offered

was a P&L the to a European that from quarter. benefit So $X the perspective in of million roughly

comes on people increased as come volume those some be in of back business the that back have back seen as though, costs mentioned, we with has Matt QX. As added the will board

nice of through So That temporary way I of good higher respiratory significant benefit volume on side America We had nice the out coming benefit Because but can we we on mobility QX. pandemic see from as obviously, had making volume that saw QX, that the with North say. actually a in in a side the as the to you our the have we is power that were volume of was the performance, and the probably house. would most house.

wasn’t ramp while as European did side, so it see some America quarter. business, And roughly the in prevalent about which North sales as down we costs the were down XX% the you on the can European

David Saxon

Dynamic then follow-up. balance other you’re I That’s any just And manage you opportunities helpful. about the might sheet? And last then your when that similar – there the help one thinking are portfolio, Great. to Controls

Matt Monaghan

Yes.

we’re pretty us the through sheet pandemic, comfortable through period. over are the forecasted getting getting think On us – balance obligations the I with the now forecasting that sheet balance

So I differently. really no would there, say indications anything

took We’re we the with to this us very actions to point. get comfortable that

Second do executed, market move out equity/debt shareholders we a to some at was very of and premium. of behalf pretty to tough price debt good nicely XXXX a quarter deals to on think, that I

really good. was that So

fine comments other I Kathy, – think there? we’re for I now. don’t know

Kathy Leneghan

nice CCL no No, I in to we’re very that categories. to improvement similar the monetize. happy that with have. the think three seen we you’d like We’ve you’d portfolio product main business to of say the There’s related discrete margins want each

now. we think happy with very we’re have I the that right portfolio

David Saxon

were mean, I the above what And just modeling. gross during margins. then quarter we Okay. lastly, was it on

Thanks on of how So so comment think just wondering kind should the we quarters. if fourth third about and you much. could

Kathy Leneghan

Yes.

at QX higher-end first was for saw So COVID power the as actually well. beds, higher-end quarter, would you’re in higher-end wheelchairs, And decline guidance products, right. higher products we QX. value the absolutely what that margins move in – a gave had in to anticipated respiratory we of When we end the

was pleasant to were that mean happy So we see that. surprise. I a

to mix products we’re slightly come QX. to less acuity rebound that that and As into down and product given in sell QX, the anticipating the going just we are continues QX business will QX

that, of significant, because product down would not in mix anticipate we seen hit would unfavorable be an QX so margins that would we and in the have QX. benefit it And that QX, would versus but

material as and as offset portion We QX that that to QX – and cost improvement well for also as well that, saw related year-over-year would to that product tariffs nice of we continue would cost, was mix. a freight in assume

puts be primarily not mix down the and the will the it. takes business. mix to of margins the slightly, product that anticipating should because will we’re of But within There So overall be be just significantly. line and down

David Saxon

for taking Thanks Great. the questions.

Kathy Leneghan

problem. No

Matt Monaghan

David. Thanks,

Operator

next Mishan from We’ll with question our KeyBanc. Matt take

Brett Fishman

beyond wanted Fishman a we’re up Matt. the Brett the I this just we timing if some was just detail Europe. return questions. if you more surprised by and is between context overall the sales of wondering an differences could then into just U.S. the on should And the were recovery the revenue two XQ, and by pre different provide about regions be to some what shutdowns? to the Thanks off there compared any in biggest were Hi, how the of in the the magnitude following for in of much performance XXXX levels? taking how We in there dynamics bit were on very on start thinking to European for little COVID

Matt Monaghan

which shut more the were in you economies severely health Their sales. the their to let’s shutdown, say, they’re back us. states actions. Kingdom, do Italy, wise the pretty response the tougher will expect cohesive questions. in were able a smoother Germany, for we in upfront, the because Pretty those see European of as to consequences the us. recover that more they Spain The organized your hermetically to actions the for Good we you United things less because and sealed, benefit the particular And economies, and catastrophe more that United sudden get and probably Certainly, of results beyond down probably time what the France we will Deeper markets to were period member more was the public back of governments in of important straightforward Iberia, But pandemic. major more France, is that say, and the was answer. Yes. of affected in forecast. call our were should complete European or, they terms that are the shorter more benefit Germany, human an let’s orderly Kingdom. from officials three fashion. economies. especially be do all But And were European pandemic – But to took those markets their would come quickly across humans them down,

Kathy Leneghan

a thing more was That that has mobility the business other the is that the pretty significant – other business I business. European No, and part of add going seating. a of to be scooter only seasonal is would

And probably QX QX. and the so, obviously, season is

you would also Europe. that for So the impact the in have have that U.S. because seen an scooters in would been It’s don’t not we really sell U.S.

Brett Fishman

or a just more inventory more it’s We magnitude building be in that in Thanks areas a demand a the then noticed been in moving slower color. of order inventory. balance may And I’m have bit for quarter? have material if of reflection if step-up little fairly during stronger built expected wondering of to off that was right. where that is All sheet. and to related the to areas

Matt Monaghan

the of respiratory quickly. or latter. where strong, turned the has been areas beds More In quite demand inventory like

fulfill having and recovery company demand us of – that especially supply part an And chain. allow to the customized really we its provider But to inventory of be order relatively have down. many that good customers large turn came not ready couldn’t for readily products It’s good a Because we inventory as the hopefully and that that’s good comes consequence. components so the which orders around off good – to expect so our about back variety we the need as news will the for assembly, be quickly long as to our is be it and of products world.

result. We a responsiveness great have as

should to expect over It fine. we liquidate period. the be So that recovery

Brett Fishman

given then assumptions of the guidance you’re it’s just been And remainder just the just right. recently? provide quick in XXXX for All one using the FX last how Can me. moving from you fast

Kathy Leneghan

Yes.

were in of rates end Our that modeling effect of the at the QX has XXXX. utilized

what the the – those half would like – that’s That’s and at its of roughly, And euro assuming rates euro year be yes. at where the on. be really roughly modeled GBP would So we’ve the probably the we a $X.XX. second like

Brett Fishman

you so Thank Okay. much.

Kathy Leneghan

you. Thank

Matt Monaghan

you. thank Brett,

Operator

at time. Ms. remarks. to further closing there this you like Lee, I’d are no It questions any appears to back additional hand or for conference the

Matt Monaghan

Lee. for Thanks. everyone, day. and their that Thanks, Kathy, Have Sarah. can a follow-up questions Lois are morning. Lois good available any through I you this Okay, coordinate for time

INVACARE (IVCRQ) 8 Aug 202020 Q2 Earnings call transcript