Teleflex's CEO To Present At Bank Of America Merrill Lynch 2012 Health Care Conference Call (Transcript)

Teleflex Incorporated (TFX)

Bank of America Merrill Lynch 2012 Health Care Conference

May 16, 2012 04:40 pm ET


Benson Smith - Chairman, President & CEO



[Abrupt Start]

Unidentified Analyst

Teleflex to present. Benson Smith, the company's CEO is here speaking on behalf of the company. We will have a 15-20 minute presentation followed by Q&A right here. So, thanks very much for joining us.

Benson Smith

Thanks [Bob] and good afternoon everyone. As Bob mentioned, I am going to run through about 15 or 20 minutes of prepared remarks. The slide deck is available online or a manual copy.

Just to get started, I do want to mention that I will be making some forward-looking statements. The future can be very different than what we think is going to look like. So with that, we will get in to what we’re going to cover this afternoon.

Let me go through a brief company overview. Teleflex has changed a lot in just the last few years, making a transition from an industrial conglomerate to a pure-play medical device company. I want to give you a good idea in terms of where we are today, talk a little bit about our strategic objectives. This is sort of a five-year look we have in terms of the goals we set out for ourselves, give you some financial information about full-year of 2011 and our first quarter 2012, which we just announced a couple of weeks ago and then a brief summary and then open it up to questions and answers.

From a company overview, Teleflex began life as an aerospace provider, middle of World War II. We were making steering systems for planes. We’re a very aggressive company, migrated from aerospace into Marine and then eventually in to the automotive business and along the way, acquired a couple of medical device assets.

By 2005, with a pretty significant downturn in the automotive business, Teleflex was looking at its future and was at least at that point interested in expanding its resources in the medical device industry; had a management team that didn’t have much experience there and a Board that had no experience in medical devices. That’s how I happened to come by way Teleflex went on Board in 2005.

Over the next two years, as the future of the automotive industry looked bleaker and bleaker at least from a supplier perspective, a decision was made to be a lot more aggressive and getting rid of those assets and acquire medical device companies. We did that, acquired Arrow in the process in 2007 and then around that time made a much more conscious decision to move more towards a pure-play medical device company.

By the end of 2010, we’ve pretty much divested all our non-medical assets. We had a few aerospace assets left, put those into discontinued operations and for basically in 2011, what you saw was Teleflex as a pure-play medical device company. It took us till the end of the year to actually divest those assets and where we sit right now all of our businesses are in the medical device arena.

Certainly, these words on the page mean a lot more than just the words here to us. We really see that particularly where we are in the healthcare industry that medical device companies can play an increasingly important role.

First of all, at improving technology, most of our resources are looking at how we can improve clinical outcomes in the areas that we serve. And I think for us, the additive value of being able to reduce procedural cost for the hospital is an important element for us. So we try and define our businesses around franchises and look for very concrete ways we can accomplish this within our franchises.

The other thing that I think is important to us as a company is the way we act with our employees, with our partners, with our customers and that we hold ourselves to high ethical standards and our expectation is that we become a trust resource for our customers.

To give you just a brief overview in terms of our product portfolio, it’s a diverse product portfolio. There is no signal product that amounts to a majority of our sales. We’re not completely evenly distributed throughout this entire portfolio, but mostly so. The biggest business for us right now is our vascular access business and the key product for us right now is in the CVC line, central venous catheters that came with the Arrow acquisition. We’re the global market leader in that particular product line with about an 80% share.

PICC product line is of course related to CVC’s and we also have a PICC product line entry as well. And we recently expanded our offering in this area with the acquisition of VasoNova; I’ll talk a little bit more explicitly about that a couple of slides from now. But this is a targeting system that helps the clinician figure out exactly where the catheter is without having to send the patient down for confirmatory X-Ray.

We also have some well know brands within the surgical arena, certainly DEKNATEL, and HEMOCLIP are two well known brands; we’re the market leader in cardiovascular sutures and in polymer clips which we begin to put product. We have an old line of general instruments that were acquired from Weck and from Pilling.

You don’t hear a lot about Teleflex in urology business in the United States, my ex-company C.R. Bard, pretty much holds the mantle there and we have a brand called RUSCH and we are the market leader in Europe, both in the Foley catheter segment and a lot of the urinary and [cardiac] segments as well.

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