Convatec Group PLC (CTEC) Earnings Call Transcript

Thank you for standing by. My name is Sarah, and I will be your conference operator today. At this time, I would like to welcome everyone to the ConvaTec AGM 2024. [Operator Instructions] I would now like to turn the conference over to Chairman, John McAdam. You may begin.

Good afternoon to you, and welcome to ConvaTec's Annual General Meeting. As a quorum is present, I now declare the meeting open. I would like to welcome shareholders and guests attending either at our London office or who are participating online through our electronic meeting platform, and thank you for joining us today. All Board members are in attendance, either in person or on the electronic meeting platform, and details of the Board members' skills and experience are available on our website and set out within our annual report. I am chairing the meeting at our London office, and I'm joined by Karim Bitar, our Chief Executive Officer; and Non-Executive Directors, Brian May and Constantin Coussios, with remaining Board members joining online. Also present today is James Kerton, General Counsel and Company Secretary, who was appointed on the 7th of May. All agenda items are fully explained in my letter, which accompanied the Notice of the Meeting. The notice was published on the company's website on the 21st of March, 2024 and was posted or made available to shareholders electronically. I propose to take the Notice of the Meeting, including the resolutions, which are being voted on today as read. We will be conducting the voting by the way of a poll, which I now declare open, and confirm that voting on the resolutions may commence. I would now take a few moments to explain the voting procedure. To cast your vote when joining on the electronic platform, please use the voting icon, which will appear in the top right-hand corner of your screen. Once you click on this, the resolutions will appear on your screen, along with the for, against and withheld voting options. Please select one of these options to cast your vote. Should you wish to change your vote, you may do so as many times as you wish until the poll is closed. If any person attending the meeting via the electronic platform, is experiencing difficulties, contact details are available for our registrar who will assist you. For those in attendance in the London office, please fill in the poll card, which you can find on the reverse of the attendance card. If you cannot find your attendance card, please raise your hand and a member of Computershare, our registrars, will help you. For this resolution, you will need to vote for, against or vote withheld abstention by putting a cross in the appropriate box on the poll card. Once you've completed the voting on all resolutions, you should sign and date the card. If you fail to sign the poll card, it will be deemed to be invalid. Once completed, please deposit your card in the poll box, which is located at the exit. Please note that a vote withheld abstention is not a vote in law and therefore, just count in a poll. Please note that only shareholders, proxy holders or appointed shareholder representatives may vote on the resolutions. You can vote at any time during the proceedings until I declare the poll closed. I will give you a clear prompt later in the meeting to all of the close in voting, once we have concluded the Q&A section. If you wish to ask a question, I would like to remind you to please click on the Q&A icon to submit your question using the chat box function. This can be done at any time throughout the meeting. Should shareholders attending at the London office or participating through the conference line wish to ask a question, they will have an opportunity to do so when we come to that part of the meeting. Turning now to ConvaTec's performance. You will have seen that we released a trading update earlier today, and I will now pass to Karim, who will comment on the trading statement released this morning. Karim?

Thank you, John, and good afternoon to everyone. Thank you for joining us today at the AGM. And for the first 4 months of 2024, our organic sales growth was 6.5%. This represented a continuation of good sales growth from 2023 and was broad-based across all 4 categories. In the Wound Care area, organic growth was mid-single digit as we expected. Growth was reduced by the continuing market-wide anti-bribery and corruption campaign in China as expected. But we continue to gain market share, and we expect to grow -- we expect growth to accelerate in China as the year progresses. In Ostomy Care, organic growth was mid-single digit as expected. The response to the Esteem Body launch in Italy in March has been strong, and we have been gaining -- and we've begun launching, excuse me -- in the U.S., Poland and the Czech Republic as well. In Continence Care, organic growth was ahead of our expectations at high single digit. Our Home Services business delivered outstanding customer service and continued to see strong new patient starts, supported by a further increase in the reimbursement models in the U.S. In Infusion Care, organic growth was mid-single digit as expected. We continue to see strong underlying demand for our infusion sets, both within and outside of diabetes and the diversification of products and customers progressing well. Given the strong start so far this year, we expect more balanced growth between first half and the second half of the year, and we are on track to deliver our full year guidance of 5% to 7% organic revenue growth. With that, I'll now hand back to John.

Thank you, Karim. We will now attend to the Q&A session. I'm going to hand over to James and his team to manage this.

Thank you, John. As a reminder, the poll will close after the Q&A session. So if you haven't yet voted, please do so now. Operator, are there any questions on the conference line?