Integra LifeSciences Holdings Corporation (NASDAQ:IART) Q1 2018 Earnings Conference Call - Final Transcript

Good day, everyone. And welcome to the Integra LifeSciences First Quarter 2018 Financial Results Conference Call. As a reminder, today's conference is being recorded.

At this time, I would like to turn the conference over to Mike Beaulieu, Director of Investor Relations. Please go ahead, sir.

Thank you, Brei. Good morning and thank you for joining Integra LifeSciences first quarter 2018 earnings conference call. Joining me on the call are Peter Arduini, President and Chief Executive Officer; Glenn Coleman, Chief Financial Officer and Corporate Vice President of International; and Sravan Emany, Vice President, Treasurer and Investor Relations. Earlier this morning, we issued a press release announcing our first quarter 2018 financial results. The release and corresponding earnings presentation, which we will reference during the call are available at integralife.com under Investors, Events and Presentations in the file named first quarter 2018 earnings call presentation.

Before we begin, I'd like to remind you that many of the statements made during this call may be considered forward-looking statements. Factors that could cause actual results to differ materially are discussed in the company's most recent filings with the SEC and in the release. Also the discussions will include certain non-GAAP financial measures. Reconciliations of any non-GAAP financial measures can be found in today's press release, which is an exhibit to Integra's current report on Form 8-K filed today with the SEC.

I will now turn the call over to Pete.

Thank you, Mike. And good morning, everyone. If you'll turn to slide four in the earnings presentation, let me start by sharing a few highlights from the quarter. 2018 is off to a strong start with first quarter sales of $357 million, an increase of 38% on a reported basis and 3% on an organic basis over the prior year. Adjusted earnings per share increased 49% to $0.58. These results were better than expected and give us confidence to raise our full year guidance for revenue by $10 million and earnings per share by $0.08.

Before Glenn discusses our financial performance, I'd like to provide an update on our channel expansion strategy and Codman integration. Last December, we announced plans within our Orthopedics and Tissue Technologies segment to expand our sales channel, improve our focus and competitiveness and better align our product portfolio with our clinical customers. Since then, we've established dedicated channels for our extremity orthopedics and inpatient wound reconstruction franchises, in addition to our surgical reconstruction and advanced wound care businesses.

As a result of these additions, we now have four dedicated channels that are aligned with our primary clinical call points. We've added approximately 30 new account managers in the first quarter and expect to add a similar number of positions in the second quarter. Taken together, these additions will substantially complete the commercial expansion plan for the year.

In the first quarter, the reduced selling time resulting from territory realignments and classroom-based training was in line with our expectations. We expect to see a positive impact on our organic growth