How is everybody doing? Quiet room, guys.

This is in-person. We’ve got lots of folks connected here virtually, but we got lots of folks here in London all gathered together.

Super excited to see some live faces and some smiley faces. I hope we fed you some good breakfast this morning.

Some folks highlighted that they are getting a free breakfast. That’s why they decided to join us.

I am hoping that by the end of this session, you might conclude there is also some value and interacting with us beyond the good bacon sandwiches. But anyway, look, a really warm welcome to everybody.

It’s wonderful really to be here in-person. And what I wanted to go ahead and do today was to try to provide you with a little bit of an overview along with Frank in terms of how in 2021, we delivered both strong financial performance and strong strategic performance, okay?

And so we will go through that. But before moving to that to that, I really would be remiss and not highlighting that this will be Frank’s last time for him to go ahead and share ConvaTec’s results.

And so I want to make sure that I really thank Frank for his tremendous leadership for all the contributions he has made to help ConvaTec frankly pivot to sustainable and profitable growth. And he’s been invaluable to me, frankly, an onboarding me.

I’ve been with the company a little bit over 2 years. And so if you’re okay, I’d like to give him a round of applause.

So Frank, thank you very, very much. Having said that, I also would be remiss in not highlighting to you that we have a special guest here in the room, but we have our new CFO, Jonny Mason, who’s a very seasoned CFO, lots of experience.

I’m very, very excited to be working with Jonny. I know he’s super excited to be rapidly engaging with us, and he’s here in the room today.

So Jonny, if you want to stand out maybe. So Jonny is here in the room for everybody who’s dialing in or connecting virtually but for all of you who are here in person, you’ll have a chance to maybe to get acquainted with Jonny and I’m sure all of us will here in due time, but welcome onboard Jonny.

At this point, what I’d like to go ahead and do is to share with you what are some of the key themes or topics that we’re going to cover. I’m just getting my clicker to move.

Here we go. I think it’s working.

Okay. Thank you to Kate who is trying to help me out there in the background.

So really four key themes or topics we’re going to cover here today. The first one is we had good financial performance in 2021, and Frank will walk you through the numbers and answer any questions you may have on that topic.

Two, I think it’s important to highlight to you that in terms of the strategic transformation investments, they are largely complete, and they’re starting to already pay off, and we’ll talk more about that and frankly, bode very, very well in terms of our future prospects. Thirdly, I’ll pick up the baton and try to focus on how have we strengthened our competitive position, okay?

And we’ll talk quite a bit about that. And lastly, we’ll conclude with how we have attractive bit about that.

Attractive growth prospects, okay? So those are the 4 key themes that we’ll cover today.

And at this point, I’m going to pass the baton on to Frank, who is really going to cover points 1 and 2. Frank, it’s all yours.

Thanks, Karim and good morning. Thank you for joining us today.

As Karim set out, I will take you through our 2021 financial results in more detail a year in which ConvaTec made good progress. Starting with our highlights on Slide 6, we achieved a good financial performance across the group in 2021 as we continue to execute our FISBE strategy.

Group revenue was just over $2 billion, increasing 7.6% on a reported basis or 5.8% on a constant currency basis. And this strong revenue performance was slightly ahead of guidance.

Our adjusted operating profit rose 3.3% to $362 million and was up 5.4% in constant currency. Our adjusted EBIT margin at actual FX was 17.7% or 18.4% on a constant currency basis, which was in line with our guidance and similar to last year’s margin.

There are number of moving parts within the margin performance, which I shall cover shortly. Diluted adjusted EPS rose more than 8% to $0.13, supported by a reduction in net finance expense and a lower effective adjusted tax rate of 15%.

This lower rate was driven by several one-offs and our guidance for 2022 is 18% to 20% for the ETR. We are recommending a final dividend of $0.04154 to bring full year dividends to $0.0587, up 3%.

And this is the first dividend increase ConvaTec has proposed since being a listed entity and reflects the Board’s confidence in our future prospects. We generated $270 million of adjusted free cash flow, with cash conversion of 72% and I will share more detail on this later as well.

Finally, the balance sheet remains robust, with leverage at 1.9x net debt to EBITDA, slightly lower than last year. Moving to Slide 7, where you can see the key drivers of our 5.8% constant currency growth rate during the year.

All of our product categories contributed positively. In Advanced Wound Care, revenues rose 5.5%, but this was moderated by the $19 million headwind from the disposal of the U.S.

skincare product lines at the end of Q3 2020. Continence & Critical Care grew 7.9% and adjusting for the Cure acquisition, organic growth was 2.1% with good growth in Continence Care, offset by flat performance in critical care as demand for ICU products declined as the year progressed.

Ostomy Care growth was 1.7% with approximately 100 basis points of revenue headwind driven by planned contract and product rationalization. Finally, Fusion Care achieved 9.6% growth in the year with a continued strong performance in the automated insulin delivery segment.

Reported revenue rose 7.6% for the group, reflecting approximately 180 basis points of foreign exchange tailwind momentum in our wound business although growth will be more and more given more normal competitive. Our Continence & Critical Care business delivered $543 million of revenue.

This includes good contribution from the Cure Medical acquisition, which completed in March as well as patient care medical. The integration of both is progressing well and delivering as expected.

Organic revenue growth of CCC overall was 2.1%. And within this, our Continence Care business grew 3.1% on an organic basis to $387 million with continued good growth at our Home Services Group supported by strong growth in our GentleCath product – in our GentleCath product portfolio.

Lower new patient starts across the segment during the pandemic had a moderating impact on 2021 growth, although the NPS gradually recovered during the year and has now returned to pre-COVID levels. Critical Care revenues were flat in 2021 at $156 million.

And from Q1 onwards, demand for our ICU products began to decline. This trend was expected, although the way of new COVID variants resulted in more robust demand than we had originally anticipated.

Looking forward to 2022, we expect a slight improvement in growth with more significant declines in critical care more then offset by an accelerating performance in Continence Care. Moving on to Slide 9, the Infusion Care business delivered another strong year with revenues growing nearly 10% to $357 million.

The performance continues to be driven by strong demand for our innovative infusion sets which are a core element of the growing automated insulin delivery segment of the diabetes market. This was supported by good growth in non-diabetes infusion care albeit off of a very small base.

The order phasing was as usual, uneven and resulted in the second half delivering our largest half on record of $182 million. We’re confident of another year of strong growth in ‘22 and are focused on expanding capacity to ensure we capture the attractive growth available.

Following the successful launch of the extended wear infusion sets in Europe, we look forward to the launch in the U.S. in 2022, the timing of which will be determined by our partner, Medtronic.

Finally, our Ostomy Care business achieved $543 million of revenues, up 1.7% on a constant currency basis. This performance was moderated by approximately 100 basis points as a result of the SKU and contract rationalization program.

We saw continued strong growth in Latin America and Asia-Pacific, supported by the governance healthcare funding programs, while our performance in North America showed early signs of commercial improvement. These positive achievements were partially offset by declines in certain European markets, notably the UK, where we are restructuring our home care business, Amcare.

We have been implementing new software as well as rationalizing unprofitable activities. Encouragingly, for Ostomy Care overall, the ConvaTec products grew 3.4%.

Looking forward to 2022, we expect growth to be similar to the 1.7% published in ‘21 with continued rationalization headwinds of approximately 160 basis points. The rationalization program will continue for the next couple of years as we look to stop manufacturing a further 300 plus SKUs and the impact of these will continue to moderate growth.

Moving on to gross on Slide 10, here you can see a breakdown of the drivers and how we increased adjusted gross margin by 100 basis points to 60.5%. We delivered approximately 250 basis points of gross margin improvement through productivity initiatives and price and mix benefits.

This more than offset the negative foreign exchange impact of 20 basis points and the inflation in cost of goods sold. On the next slide, I thought it would be helpful to provide some insight into our cost of goods sold and the inflation we experienced in 2021.

As you can see, the largest bucket is raw materials and third-party products. The inflation in 2021 was approximately 2.5% rather than the normal circa 1.5%.

The biggest driver of this was the increase in resin prices. Freight and logistics are relatively small proportion of our cost of goods sold, approximately 5% and related to shipping raw materials in and sending finished goods to the relevant distribution centers.

Here, the inflation was approximately 3x higher than normal. Finally, the last bucket of cost, approximately 40% of our cost of goods sold relates to the conversion process.

About half is labor cost. And in 2021, inflation is normal.

Overall, cost of goods sold inflation in 2021 was approximately 3% rather than the normal 1.5% to 2%, with most of the uplift felt in the latter half of the year. Looking forward, we are mindful that the inflationary backdrop deteriorated as the year progressed and that it is likely to persist throughout 2022.

Therefore, we think it’s fair to assume that inflation could potentially more than double to circa 5%. This equates to approximately 125 to 150 basis points additional margin pressure, which we have factored into our guidance today.

To mitigate this, we are leveraging our pricing COE, enhancing pricing discipline and looking at opportunities to pass through inflation. We are continuing to drive productivity and also increasing automation in the business.

And although automation is not a quick win, this will over time deliver benefits. Finally, given the inflationary uncertainty will be disciplined with our discretionary OpEx spend, which brings me to the movement in OpEx, as you can see here on Slide 12.

We have now largely completed our strategic transformation investments and have improved the overall balance over OpEx. As you can see from the stack bars at the top, we have increased the proportion we spend on sales, distribution and marketing and on R&D, the levers for sustainable future growth.

Our G&A increased slightly to 11.7% of sales although this figure does include over 100 basis points of non-recurring investments in 2021. If you recollect back in 2018, we highlighted the need to invest in the business to drive sustainable growth.

That year organic revenue growth was just 0.2% and EBIT was declining as you can see from the chart in the bottom left. Our strategic investments are delivering as planned and we have turned around that trend, now growing organic revenue by 5.3% while EBIT increased 5.4% in 2021 in constant currency.

Looking forward as well as continuing to deliver sustainable top line growth, we see strong potential to expand the margin to the mid 20s. We do expect to continue to invest in sales distribution and marketing, particularly as we support our new product launches and a new master brand.

We also intend to continue to invest in R&D to support future growth. However, much of the rebalancing has already been achieved.

We do think there is a material opportunity to further improve our G&A efficiency and expect that as a percentage of sales, it will reduce to approximately 7% over time. This will be supported by further gross margin expansion as we leverage price, mix and productivity improvements, for example, via automation.

Finally, given the enhanced platform we have created, there is an opportunity to leverage as the business growth both organically and inorganically. Moving on to Slide 13, here you can see how we are using our cash flow to invest in future growth while also returning cash to shareholders.

We generated just over $400 million of net cash from operations. This was approximately $100 million lower than the prior year with the increase in adjusted EBITDA being more than offset by a step up in working capital.

Receivables increased given the revenue growth. We increased inventory levels to build resilience and there was phasing of payments related to 2020 accruals and provisions.

Cash conversion was 72% in 2021. And in 2022, it is expected to be broadly similar as we continue to invest for growth.

Net interest paid was $13 million less than last year at $36 million, reflecting lower interest cost on the group’s borrowings, while cash taxes were $59 million. We have continued to invest in the business for future growth.

We spent $94 million on CapEx and $112 million on acquisitions, of which $85 million related to Cure Medical and the remainder to the Patient Care Medical acquisition. Looking forward, we expect CapEx in 2022 to be between $100 million and $120 million.

We paid $86 million of dividends to our shareholders and overall net debt at the end of the year was $881 million. As you can see on this slide, this reduction in net debt coupled with the increase in adjusted EBITDA resulted in us reducing our leverage to 1.9x, which is in line with our target of at or below 2x net debt to EBITDA.

Assuming regulatory approval, we could this year, spent $125 million to $175 million on the Triad acquisition, the initial consideration plus the two potential milestones this year. It’s worth noting that the timing of these potential payments will likely result in our leverage being above our target temporarily.

We would expect to be around target levels by the end of the year though. During 2021, we also successfully issued ConvaTec’s debut bond with the $500 million proceeds from these senior unsecured notes we paid off some of our existing bank debt.

This action diversifies our debt and extended our maturity profile from 2.2 to 4.3 years. Finally, on Slide 15, let me confirm the guidance for 2022.

We now expect full year organic revenue growth of between 4% to 5.5%, with continued good growth in Wound Care albeit against more normal comparatives, modest improvement in CCC, a similar level of growth in Ostomy Care, and continued strong growth in Infusion Care. On the margin, we now expect a constant currency adjusted EBIT margin of at least 18% with margin improvements through volume, productivity and mix and lower non-recurring and MDR expenses expected to offset the annualization of last year’s recurring transformation investments and continued elevated cost inflation.

Wrapping up the financial review, we have made good progress during 2021. The outlook for 2022 is positive and the medium, longer term potential is exciting.

I am pleased to be passing the baton to Jonny, with the company in much better shape than 4 years ago and now on an improving trajectory. And with that, I will hand back to Karim.

Thanks. Having trouble moving my slides here if you are connected virtually.

Okay. Here we go.

Okay. Frank thanks a lot for that.

That was a very thorough and concise review of how we performed in 2021 from a financial perspective. What I’d like to do now is to really focus on as we have made all these investments and they are largely complete, what’s been the benefit?

How does it actually strengthen our competitive position? And how does it bode in terms of our future prospects, right?

Thank you, Kate. Kate is helping me out here, backing me up.

I’ll rely on you to move the slides then here, Kate. Okay.

Let’s talk about our competitive position. When you think about our competitive position, what I’d highlight to you is that the first thing we have tried to do was to reconfigure our product portfolio and we have been very deliberate about that.

And we have gone ahead and used both inorganic and organic means to do that. On the inorganic side, what we said is you know what, we are focused on four categories: Advanced Wound Care, Ostomy Care, Continence Care and Infusion Care and 12 geographies and 2 of them are Uber important, USA and China.

You consistently hear us say this. 4 and 12, you can draw your matrix.

And as we thought about that and we thought about our portfolio, we said how do we strengthen our position? So for example, in the area of Continence Care, we went and acquired Cure Medical, Continence Care USA.

What did that do for us? It catapulted us to the number two position as a manufacturer in the USA.

We were able to secure a complementary product portfolio, strengthen our sales and marketing and distribution network in the U.S. And frankly, we are a formidable competitor now in the area of intermittent catheters in the USA.

Similarly, we had a very strong home service group, 180 Medical in the United States. Significant market share growing, but we want to strengthen it.

So we went ahead and acquired Patient Care Medical. And you might say, well, why did you do that?

Was it just purely about critical mass? No.

It helps us build critical mass. We have got great service levels.

But historically, the 180 Medical team has really been focused on new patient starts. So, if I had a spinal core injury for the first time, unfortunately, guess what then I would go ahead and maybe try to use the service and product offerings from 180 Medical, but these were new patients.

What we have done now with Patient Care Medical is they actually don’t have any salespeople that cover and go into clinics and hospitals. It’s all done virtually inside sales, digital approaches.

And for all of those patients currently who are maybe using intermittent catheters and are not satisfied with their product or service, they have an incredible ability to be able to go ahead and grow our business. So hopefully, you are getting a sense from an inorganic perspective, we are actually very thoughtful as to where do we pursue these bolt-on acquisitions.

From an organic perspective, what do we do? Well, when we start thinking about organically, we reconfigure our portfolio by, for example, rationalizing our portfolio.

So we started thinking, hey, can we go ahead and reduce the SKUs, right. So, Frank alluded to that and I will talk to you more about that in Ostomy Care.

And we have driven that aggressively, and I’ll give you more data. And then we think from an inorganic perspective, not only is it inbound, but how could it be outbound?

There maybe some businesses that are low margin. They are not growing.

We don’t see growth prospects. And so we divest them, like the skin care business, like the incontinence business.

So the first point I am trying to make to you is from a competitive position perspective, we are reconfiguring our portfolio organically and inorganically, inbound and outbound. The second thing we said, you know what, for us to be a successful med-tech company, you got to have a strong pipeline.

So we have been investing heavily in R&D. And several years ago, we would only had about two products, new products ready to launch in the next 30 months.

Today, we find ourselves with a much richer pipeline across all categories. We are planning on launching 8 new products, and I’ll give you more color around that here shortly.

So, you reconfigure the portfolio, you strengthen your pipeline, but then you got to execute, right? So, what have we been doing on the execution side?

Well, we have been strengthening our commercial execution, and I’ll give you more color to that, but also in quality in operations, how do we make sure that we are a reliable and trusted supplier, right? And so we worked on quality.

And what you see here in this chart is the complaints per million. So we literally track all the complaints that we get from consumers, from healthcare professionals, etcetera.

And you can see there is a clear reduction of about 25% in the complaints per million. And I will talk to you more later on as to how do we actually address that, how have we been able to actually do this, okay?

So, as you see us reconfiguring the portfolio, strengthening the pipeline, executing better, you see this clear acceleration in top line growth, okay. So hopefully, you’re getting a sense that our competitive position as a company is strengthening.

Next slide. How we got about doing this is by executing on our vision, pioneering trusted medical solutions to improve the lives we touch.

That’s our true north and then executing on our corporate strategy, FISBE. They should be familiar to you.

Focus, 4 categories, 12 geographies, very clear. Innovation, it’s a life blood of being a successful med-tech company, you got to have a strong R&D capability.

We need to simplify the way we operate. We need to become more agile.

We are working on this. And I’ll tell you more about how we’ve been doing that.

Fourthly, unique capabilities, unique capabilities in quality, in sales and marketing. So, you have to invest in building that muscle tissue.

And then lastly, it’s really important, and I can’t stress this enough, we have been really working hard on improving our execution. So therefore, our do-say ratio increases.

We say what we do and we do what we say, really, really simple. But let’s see how we have executed on this FISBE strategy.

We are having trouble moving the slides, okay. Some way, shape or form it moved.

So let’s stay on focus. When we talk about focus, what’s important to realize is that we pursued acquisitions I described to you already the Cure Medical acquisition and how that’s really helped us position us to be the number two producer or manufacturer in the U.S.

I have described to you already Patient Care Medical and again, how that’s enhancing our competitive position on the home service area. We have also pursued partnerships, right.

So for example, with RLS, we secured a partnership to go ahead and market and develop a debridement gel, it’s a unique debridement gel, it’s got some antimicrobial property. So it’s part of the wound hygiene approach.

So we are currently marketing in Europe and then we are looking to develop it for the U.S. marketplace.

But interestingly enough, on focus, not only have we tried to go ahead and focus on those categories organically and inorganically, but we’ve also invested heavily in the 12 geographies. And so what you’ll note is that in the 12 geographies we’ve grown our revenues 7.9%.

That compares to throughout the whole company, about 5.8%. So where we’re making our investments organically, we’re seeing accelerated growth.

And I think it’s important to highlight that. Next slide, back one, please.

Thank you. In terms of focus, we’ve also tried to go ahead and ensure that we focus on the advanced wound care area.

And we try to do that in the USA. So therefore, the acquisition of Triad Life Sciences, you might be saying, well, who is Triad Life Sciences.

Triad Life Sciences is a U.S. biotech company.

And what we went to the head and did was we said, you know what, we really want to go ahead and enter the Biologics Wound Care segment. So during the course of a couple of years, we’ve been analyzing and assessing do we want to do that by the allograft area, which would basically say human tissue, think of it that way or xenograft animal tissue.

We clearly want to be in xenograft. And we clearly want to be in force on it.

And if we had more time, I’ll tell you more about that, but it’s actually quite thoughtful. So what’s happened here is that we’re entering a very large market, a $1.8 billion market segment, that’s growing high single digits, right?

And we’ve been able to secure access to a highly differentiated product offering. It’s basically a biologic medical device.

So this is basically porcine or pigs placenta. And what’s really cool about this placenta is that, in essence, it provides you with functional proteins and structural proteins.

And these proteins, the structural ones provide a skeleton or a scaffolding to help the healing of very difficult to treat wounds, okay? And the functional ones actually help you from a regenerative medicine perspective, okay?

So not only are we securing a really exciting technology, but in addition, we’re entering a very fast-growing segment, but also what I’d highlight to you is it allows us to leverage our capabilities. So we currently, in the U.S., for example, call on wound clinics, we call on hospitals.

We will be able to leverage that sales and marketing infrastructure, okay? So it makes sense for us strategically, what about financially?

Well, revenues are going to be accretive in year 1. EBIT is going to be accretive in year 2.

And from an ROIC perspective, return on invested capital exceeding our cost of capital, we anticipate that will happen in year 3. So we’re very, very excited about this opportunity.

And again, you’re getting the sense of how are we going ahead and focusing on those 12 geographies and forecasters. On the innovation front, what have we done?

We’ve increased our investment. You’ll notice that back in 2018, we were spending about $50 million roughly on R&D.

Today, we’re spending close to $100 million, $95 million to be precise, right? So we clearly are investing more.

We’re rebalancing our OpEx spend. As a result of those investments, we strengthened our capabilities in product development, process development, clinical development, regulatory, under the leadership of one individual, one Chief Head of R&D.

Dr. Divakar Ramakrishnan.

And as we’ve done and strengthen these capabilities, we’ve made sure now that across all of ConvaTec, there is one single methodology we use to develop, scale up and launch our new products, right? And we called it IDEAL, ideate is for I, D for develop, E for execute, A for approve and then we go ahead and make sure we launch, right.

And what’s important about this, it’s a stage gate process where cross-functional teams, for example, will review and assess have we locked our design? Are we ready to scale up?

Are we latest supply to the market, right? So these gates will we review them.

And I personally frankly, get involved in that process, okay? So again, this is new muscle tissue we’re developing.

As a result of these efforts, we have a richer pipeline. This pipeline basically consists today of eight new products that we plan on launching during the course of the next 30 months.

And if you’ll notice in 2022, we’re anticipating launching four new of these products. The first one is GentleCath Air Mayo.

So historically, at ConvaTec, we’ve had a proprietary technology, which we call our field clean technology. And it’s a third-generation intermittent catheter technology.

You might say, what does that mean practically game. Help me understand.

Well, today, if you’re using an intermittent catheter think about this, okay, you’re using a intermittent catheter and you’re having to go ahead and use it 4, 5, 6x a day. Friction is bad, right?

I think intuitively, we can all understand that. Friction is really bad.

So you want something with very high lubricity. Today, typically, – the intermittent catheter will have a coating on it, quite sticky, frankly, quite messy.

Our field clean technology, what’s really neat about it is has embedded in it proprietary additives in the plastic in the polymer, and it’s basically – I am going to use common language and say, it’s basically there is no friction. So we know that the performance is very strong, but we have never had it in a compact form, mascara like.

So we’re looking now to launch GentleCath Air, air meaning compact here in 2022 during the course of the spring and summer. So we’re excited about that.

B, we’re going to be launching a NovaMatrix. This is the whole triad area, so the biologic medical device.

Mio Advance – we’re looking to go ahead and expand the launch of that in the U.S. We have already an FDA approval.

This is an extended wear infusion set, lasts up to a week. If you have Type 1 diabetes and you’re using an automated insulin delivery, you’re always looking for space area, right?

Your skin off and gets irritated, so the fact that you can use in an infusion set once a week versus once every 3 days, is a really big deal from a clinical perspective. There is strong demand.

We’re getting positive receptivity in Europe, so we anticipate strong demand. And then ConvaFoam.

This is the largest segment in the Advanced Wound Care area. It’s about a $1.6 billion segment, and we’re strengthening our portfolio.

How ConvaFoam will have much better exida absorption properties and significantly better adhesion properties. So I’m not going to walk through all of the eight new products.

I’m trying to give you a sense that our pipeline is getting richer and frankly, what we’re going to be doing is on May 17, all of you will have an opportunity to spend some quality time with Dr. Divakar Ramakrishnan, our Head of R&D, and we will have a chance to review the eight new products, the new capabilities we’re putting in place and so I would welcome you and encourage you to join and attend that session, if you want to learn more about how our new products are developing and coming along.

What about on simplify? What are we doing there?

Well, we’ve been investing in GBS, Global Business Services. We stood that up in Lisbon, and we’re trying to streamline and improve processes, things like purchase to pay, order to cash and making good progress there.

We’re planning on expanding and leveraging GBS and in the area of IT and HR during the course of 2022. And in terms of rationalization, we’ve already reduced our portfolio by about 25% and – so we were roughly at about 2,500.

We’re down to about 1,800 right now. And as Frank alluded, we’re going to continue to drive that rationalization, and we anticipate reducing it by an additional 300 SKUs during the course of the next couple of years.

So we will have moved fundamentally from about 2,500 down to 1,500. Why are you doing that?

You’re getting these headwinds on the revenue side. Well, it’s pretty simple.

We want to make sure our very best offering is in the marketplace. We want to take out complexity from a cost and manufacturing perspective, and frankly, that impacts our margin.

So it’s the right thing to do. It takes some time to work through it.

But we’re simplifying the way we approach our business. What about on capabilities?

What are we doing on the capability front. On the capability side, which you’ll notice is we’re investing, for example, in the Salesforce Center of Excellence.

But practically, what did we do? Well, we rolled out a new customer relationship management system for the first time, Microsoft Dynamics 365 rolled out in North America, rolled out in Europe and practically what that has allowed us to do is to clearly identify who are our A accounts, B accounts, C accounts and ensure that from a frequency from a call rate perspective, we’re focused on the most important customers, right?

So this is what I talk about when I talk about commercial execution. This year, we will be expanding the rollout throughout all of the global emerging markets.

And frankly, the users and the adoption is high. People like to use the system.

It’s helping them, our salespeople to helping them be more effective in the field. If you then go to marketing COE, what are we doing there?

We’re going to be refreshing the ConvaTec brand, the ConvaTec master brand. You’ll hear more about that during the course of 2022, but we’re excited about the refresh.

And then, for example, on quality. We really focus on rapidly detecting if we have an issue.

We have a dedicated leader just focused on quality now, rapidly addressing the issue. And you might say, well, how do you do that?

Well, the issue could be related to design. So we work with R&D, and we’re going to redesign the product or, frankly, might be related to what’s happening on the factory floor on the assembly line, and we addressed that issue there.

And so that’s why you saw the complaints per million coming down. We’re being proactive about this.

We’re making sure that we’re living our vision because we said pioneering trusted medical solutions, right, trust, I got to be able to rely on you. Not only are we leveraging centers of excellence in areas like sales and marketing and quality.

But in addition, we’re going ahead and investing in our people, making sure that we embed processes around, for example, consistent usage of performance management or succession planning. In the area of succession planning, for example, we’re very focused on diversity, equity and inclusion.

And we’re very committed to increasing the representation of women in leadership. We have about third of our senior leaders today are women.

Our goal is by 2025 to be at 40% plus, and we’re very much committed to doing that. What about on execution?

How are we doing on the execution front? Well, an area like quality and operations, we keep on driving efficiency.

So for example, in Haina in the Dominican Republic, we’ve been working on scrap rates, and we’ve reduced the scrap rate there by about 15%. What about in terms of our environmental record, what are you doing in terms of greenhouse gas emissions?

Well, we reduced them again by over 8%. In the area professional education, we trained over 300,000 health care professionals last year.

I mean COVID, frankly, in a certain way, really drove this whole idea of the hybrid, the virtual approach. And so as a result of that, we’ve been leveraging the ConvaTec Academy of Professional Education, and we measure the impact we have on these healthcare professionals.

Is it a positive experience, etcetera. And that’s what we mean by the Net Promoter Score being high.

On pricing, we also work on pricing. We have a pricing center of excellence that we’ve set up, and we’re taking much more of a hawkish approach, much more of a centralized control approach, setting floor prices, reviewing discounting, etcetera.

Historically, in the med tech industry, you would find that prices would come down roughly 2% per annum. ConvaTec would normally experience about a 1% price erosion per year.

You can see here that last year, we were able to increase our price by about 50 basis points or 0.5 percentage point. So our do-say ratio is improving.

Let me try to go and summarize at this point. I hope you’re getting a sense that through the largely complete strategic investments, we’ve stabilized the business.

But not only have we stabilized the business, we’ve made important investments in foundational capabilities, which will serve us well for the future. And we’ve strengthened our innovation pipeline.

So as a result of that, what’s happening is we are pivoting to sustainable and profitable growth. I’m not going to use the past tense.

There is still work to be done, but we are pivoting. There is clearly a shift.

There is clearly movement here, okay? Next slide.

So what about our prospects. We’ve made these investments.

We’re executing on FISBE, we’re more focused, we’re more innovative. We’re simplifying.

We’re building capabilities, we’re executing. But look, we’re competing basically in large markets.

If you sum up to four categories, it’s about $14 billion worth. And these markets, in essence, are all growing at 4% or more.

So what we think is that we can go ahead, moving forward, grow our business sustainably in mid-single digits. We think it’s reasonable and you should expect us to grow our business year in and year out between 4% to 6%.

Let’s try to go ahead and conclude. In summary, what have we said today?

First, 2021, we had a good financial performance. Strategic transformation investments are largely complete.

We are pivoting to sustainable and profitable growth. How are we doing that?

We’ve strengthened our competitive position. Our growth prospects moving forward are attractive.

And from an outlook perspective for 2022, we’re planning on growing our revenues between 4% to 5.5% organically. And in essence, we’re saying, you know what, at a minimum, our EBIT margin is going to be 18% or more, right?

So I hope that gives you a sense of where we’re at, but I would say in conclusion, from my vantage point, I’m definitely confident in terms of the growth prospects that ConvaTec has moving forward. So on that note, thank you very, very much.

Okay. We’re opening it up for Q&A now.

[Operator Instructions]

Just as we get ready to do Q&A, my guess is there is one question, which is probably on a lot of people’s minds. And so, I am going to try to proactively address the question and if Charles will come right to you.

Unfortunately, as we all know, there is a very dire and very sad situation right now occurring in the Ukraine, right? It’s just a terrible situation.

And so when we think about that situation, what I wanted to share with you first is that in terms of our exposure as a company is very, very modest, okay? So we have revenues of about $45 million or approximately 2% of sales in Russia and Belarus.

So we don’t actually have a commercial presence or a presence in Ukraine, but in these two neighboring countries, right? I think what’s important to highlight about the situation is really two things.

From a principal perspective, what are we trying to do? So as a healthcare company as a medical technology company, we are very, very committed to providing access to our offerings, right?

And so regardless of nationality, regardless of creed, regardless of race, we always strive to go ahead and provide access to patients all around the world, right? And we’re going to continue to do that.

We think that’s the right thing to do and the we’ve historically done. Having said that, I think there is also a humanitarian aspect to what’s happening in the Ukraine, and so as a company, we’ve decided to go ahead and be responsive to the situation.

And from a humanitarian perspective, we will be contributing $1 million worth of both money and frankly, product to the Ukrainian popular. So we’re actively working with non-government organizations such as the Red Cross to go ahead and direct those resources in that direction, but we feel that’s the right thing to do.

So again, we will take all your questions, but I just based on what’s happening in the world, and my guess was – some of you may have had some questions on this topic, it was only appropriate thing to try to address it proactively. Okay.

Let’s open it up now more broadly, if you could just identify yourself, that would be helpful. And then Frank and I will try to answer your questions.

Hello. Charles Weston from RBC.

Three questions, please. First of all, in terms of the restructuring of your OpEx, obviously, it shifted a lot as you identified over the last few years.

Can you give us a sense of the number of people that you might be wanting to hire into your sales and R&D force over the next year and what that might do to expenses as a percentage of sales? Secondly, on G&A, you mentioned there was a non-recurring investment as part of your core EBIT last year.

Can you give us a sense of how much that might be this year? And lastly, you’ve mentioned in the past you saw some tailwinds in LatAm and Asia Pacific from sort of particularly larger orders funded by governments there.

Can you give us a sense of what the contribution of that was and what the equivalent headwind could be this year? Thank you.

Yes. So let’s try to see work through these.

OpEx restructuring a number of people to hire. I think in sales and marketing and R&D was the question, is that right?

Look, I would say I don’t expect any significant increases in terms of numbers, frankly. So that’s what I’d say on both fronts, we’re not going to disclose specific numbers that I don’t think would be appropriate from a competitive perspective to do that.

But fundamentally, I think we’re very focused more on quality as opposed to quantity, if that makes sense. So I don’t expect major significant movement there.

On the G&A question, maybe I’ll let Frank answer that.

Sure. So this year, we had – as we mentioned, over 100 basis point impact in G&A.

In total, our non-recurring related to transformation was about $30 million in 2021. And we expect a very material reduction more than half of that will come down in 2022, of which a portion of that will stay in G&A.

I think here about the comment that Karim made on expanding GBS. So there is going to be some non-recurring costs associated with that while we’re expanding the capabilities and the scope of GBS.

So it’s going to be materially lower and more than half lower than what it was in 2021.

And then look, on the LatAm comment. I really don’t see the government spend having been a major factor.

And so in terms of potential headwinds for ‘22, I don’t think that’s frankly material. And now what I actually would say is, if you ask me, Karim, what is your expectation for growth in global emerging markets, Latin America and Asia Pacific?

We grew double-digit in ‘21. I anticipate we will grow double-digit in ‘22.

Thank you. Just to clarify, sorry, everyone with the hands up.

On the – as a percentage of sales then for R&D and SG&A, you mentioned if you weren’t investing in significant headcount, could we expect to see even a slight operating leverage of those two investments?

I think it’s premature to comment at this point, Charles. I mean, I think really – we’re really focused on doing what’s right for the business as opposed to taking the next quarter semester just to kind of make the numbers look good.

We’re just not doing that honestly. So our real focus is pivot to sustainable and profitable growth because you know the history of the company as well as ideal.

And so I think it’s really important that we do what’s right by the business. So you have a little bit of a longer time horizon.

So they won’t have to go back each and every time and say, yes, yes, yes.

Thank you.

Christian Glennie from Stifel. Firstly, just to talk a bit more about expectations on guidance for ‘22 and then the sort of out years as well.

So on the – at least 18% margin, what are some of the sort of headwinds, tailwinds there that could mean that it tracks more materially higher? I mean, the consensus is more like high 18s to 19 currently today.

And then on the moving to that mid-20s margin and getting G&A down to sort of 7%, some idea of the rate of that improvement, is it a 5-year target, some idea about how we get to that?

Million dollar question, right? I’ll let Frank comment on the margin short-term, and then I’ll take the medium-term outlook question.

Yes. So as we also laid out in the presentation, the clear tailwinds are, of course, growing 4% to 5.5%, right?

With 4% to 5.5%, you get operating leverage, so that’s an important driver of how we move forward. On top of that, we’re managing price and mix, and we’re managing price and mix a lot better than we did 4 years ago.

We have good contribution from productivity programs. Karim talked a little bit about that, that has been a good contributor since we started the transformation in 2019, and every year has been helping get additional profit in the gross margin line.

At the same time, of course, we are experiencing elevated inflation. And we have explained that in 2021, the overall inflation was around the 3% mark.

And given what we have seen in recent reports and translating that and we baked that into our guidance, this could be sort of a 5% type inflation on cost of goods sold and that is 125 to 150 basis point additional headwinds above sort of normal historical inflation on the EBIT line. So those are the key building blocks how we’re thinking about 2022 that leads to us being at least 18% in constant currency versus 17.7%.

Again, I want to highlight that we clearly believe that the trough of margin was in 2020, 2021, and we’re moving forward with an expansion of our margins starting in 2022.

Look, on the medium-term question is when could you basically get to the mid-20s? Two comments.

I mean, a, definitely stand by the mid-20s. We don’t see – I don’t see anything structurally as to why we can’t get there.

So it’s really a question of timing as to how quickly can you get there? I think there is a fair amount of, frankly, uncertainty just in general, when you look at the outside context.

So there is certain variables that we can influence. So clearly, earlier is better.

But I think we sort of positioned it today and said, hey, medium, long-term, we think we can get there. So I think as you do your modeling, you do your assessments, I’m sure you’ll come up with a base case, a best case and a worst case, right?

But we clearly know what we need to do. And so we’re going to really focus on from a managerial perspective, what do we need to do.

It’s very clear to us. We need to continue to invest in R&D.

We continue to invest in sales and marketing, frankly, make sure that that’s productive, okay? It’s not just spend.

And then on the G&A side, we are very transparent with you and saying, look, there is a significant opportunity to drive that. And so frankly, moving forward, both myself and Jonny, have our work cut out for us, right?

I mean if you think about it, you’re rough 811, maybe there is 100 in the non-recurring. That’s still about 300 basis – that’s a fair amount of heavy lifting to be done.

So there is some work to be done, but we’re committed to adding it done.

Sorry, can I ask – my follow-up would be on Infusion Care. And just a bit more on the dynamics in that market, some of the issues Medtronic’s having, obviously, you had a strong second half but is it tandem coming in, you’re able to more a tandem and/or – and also a follow-up on the timing of the extended wear product?

And how much is that impacted maybe by Medtronic issues today?

Yes. So look on that route.

So, I think we are very well positioned and the end market is very attractive. So, let’s start off with the end market.

What are we talking about here, so the end market is automated insulin delivery. So, type 2 diabetes market, diet and exercise fails, oral medication fails, glucagon-like peptides, don’t work anymore.

So, I need to use insulin, right. So historically, you have been taking multiple injections of insulin, right, subcutaneous, I should be going here, okay.

I have got some fat tissue as go. That’s what you do.

So, in automated insulin delivery, you are using a pump and an infusion set and a continuous glucose monitor. Those three elements form the Triad.

That segment because now you basically have the artificial pancreas, where you can continually measure your blood sugar levels. And there are algorithms that automatically will say, dish out x number of units, you can keep your blood sugars very tightly controlled, which is amazing.

The patient loves it because they can actually sleep through the night. They don’t have to go in urinate and get up in the middle of the night.

The doctor loves it because you have got tight glucose control. You are not going to get all these complications of retinopathy and nephropathy, etcetera.

And frankly, the payer likes it also because uj are avoiding hospitalization and complications. So, that segment is clearly growing in high-single digits, and I anticipate it will continue to grow at high-single digits for a long time, right.

And we can debate that more, if you like. That’s the end market.

We are the world leader in providing infusion sets. They are what you need, particularly when you have a durable pump being used to go ahead and administer that insulin.

And it’s a lot of IP, there is a lot of manufacturing know-how, yes. So, I would anticipate that our offering will continue to be very valuable to folks like Medtronic, Tandem Diabetes, Roche, but frankly in other applications.

So for example, we are working in Parkinson’s disease on L-dopa and carbidopa. And I would anticipate you will hear more about that on May 17th, how that’s coming along, but we are making really good progress there.

So, I think the bottom line is that there are good growth prospects within diabetes and insulin outside specific to Medtronic, which is a little bit of your question, again, it’s for them to comment publicly. But our sense is that they are working very hard on addressing any of the FDA issues.

Our sense is that they really value extended wear infusion sets. And so we are seeing that in the marketplace already in Europe.

So, I would anticipate that during the course of 2022, we will be launching our extended wear infusion sets in collaboration with Medtronic in the U.S. Maybe we go to Veronika just maybe first and then…

Thank you so much. Three from me.

One, you mentioned in the prepared remarks that you have restructured the UK home care business. Just would love to understand what you are doing, what’s happened of why you have taken that decision?

And is this still core? That would be my first one.

My second one is, obviously, Karim, 2022 is a big year in terms of product launches. Curious if you can give us a little bit of what your expectations are for conformant for the male catheter in terms of what you would consider a success or failure when you think about market share, I guess not in ‘22, that’s probably too soon, but ‘23, ‘24, just so we can measure that return on that R&D spend that you have accelerated?

And then my last question is a little bit boring, but just the ID print in the fourth quarter, any stocking or pull forward of demand? And if not, is that just the U.S.

launch, or is there something else that’s driving that really outsized growth in the fourth quarter? Thank you.

And the fourth quarter is talking specific to IC to Infusion Care was your question, yes. I will let Frank take that one, and I will take the next, Frank?

Yes. So, we have not seen any specific stocking in Q4, driving that growth in Infusion Care.

We have talked about this before. There is a level of, I would say, uneven distribution between quarters.

We prefer to talk about the growth on a six-month or in fact, in the case of Infusion Care 12 months rolling. And if you look at 12 months rolling, it’s a 9.6%, we sort of jives with the fact that this is a market that is growing very nicely.

We are performing very well within that market – with our differentiated product portfolio. And we have said earlier in 2021, in fact, that we believe that this market can grow sustainably in the high-single digits, so nothing specific.

There is always some movement, but nothing material to point out.

Yes. So look, on the UK Amcare situation, pretty straightforward.

Look, when you think about our Ostomy Care business today, the three largest markets in the world are the USA, the UK and Germany in that order, one of the largest and fastest-growing markets is China. I am just being simplistic here, right.

So, the first thing we have said, hey, as we turn around the Ostomy Care business, we need to stabilize the business in the USA, and that’s exactly what we have done. We are very focused on new patient starts.

Frankly, that business now stabilized. We have improved our commercial execution there.

We are working very closely with the Home Service Group or 180 Medical in the U.S. to help support our efforts in Ostomy Care.

That dog hunts, that’s working well. Next is the UK, okay.

So, what’s happening in the UK, UK Amcare, by and large is fundamentally in Ostomy Care Home Service entity. The vast majority of the product offering was non- ConvaTec product, okay.

And so frankly, that’s a problem. Second, the quality of service wasn’t where we needed to be.

So, how do you improve service levels, guess what, 180 Medical has the recipe, right. They have got net promoter scores in the United States comparable to Apple and Walt Disney.

So, who’s running Amcare right now, it’s the same Home Service Group. So, Seth Siegel [ph] runs that with his team.

So, what have we done, the first thing we did was we deployed a new system, software system to interface with physicians and payers and nurses. And it was quite tricky, frankly, in the course of the summer, right.

You always have some trip-ups. But now you can see that the service levels are significantly improving.

So, we went from four Net Promoter Scores to even four, and now they have re-upped. And so we are doing pretty well.

I won’t say excellent, but you can see that. Same with the product offering, we need to make sure that we have got our very best offering from ConvaTec in that area.

So, it’s a turnaround. It’s the number two market.

I anticipate that during the course of ‘22 and ‘23, we will go ahead and turn that around, right. And that positions Ostomy Care then for profitable and sustainable growth.

So, that’s the Amcare question. On the launches, look, the way I think about the eight new products is not to focus today at least on, hey, this one product is going to sell X or Y.

The way to think about it is to say, look, do I believe fundamentally ConvaTec can grow 4% to 6% mid-single digits consistently and reliably, that’s really the question. And I think the answer is we believe that, I certainly believe that.

And so the eight products help underpin the confidence because you need to have a stream of innovation. So, we will have a chance on May 17th.

I am sure you will join us to talk more about entire pipeline, but that’s the way I would tend to think about it is that hopefully, as you think about your investment thesis, it gives you more confidence that it’s sustainable. It’s not a 1-year or 2-year gig in terms of bumping up the revenues, but there is some sustainability to the story.

By the way, for all the folks that have connected virtually, we are also going to take your questions. I have got two more in the room, but please be patient with this.

We haven’t forgotten you. Graham?

Thanks. There we go.

It’s [indiscernible] from UBS. Just a follow-up on Ostomy there.

So, we are talking about new products. And obviously, the combination of growth comes from new products and the service you are putting in.

And if we think of Esteem, you flagged it in for the tail end of next year. Do you think that’s the final piece of the puzzle on Ostomy to really get that growth, particularly in the U.S.?

And can you share any details about what might make that different? And then just on service, you sort of mentioned CRM.

It’s something you flagged before. I couldn’t quite hear the property.

Did you say that was your first CRM system with the first rollout of this? And if that’s the case, what were using before?

Yes. I am going to hand that to you.

So, why don’t I have Frank handle the CRM one, and then I will comment on…

So, we had a hot part of systems. That’s basically the simple answer, right.

In every region, we had something else, some were homegrown. And what we mean with the CRM, we have now, it’s a globally consistent system that is rolled out in Europe and U.S.

we see great engagement from the sales force. We see productivity metrics.

We measure that, of course, now. We see the opportunity management utilized and it’s completely embraced by the sales force, and that was very different in the past, and we are going to roll it out in the emerging markets in ‘22.

Look, on the Esteem 2.0, Look, I think it’s an important piece of the equation, as we have been thinking about how do we turnaround our Ostomy Care business. The first thing we really focus on is on improving our commercial execution in the key markets.

And I think that’s well underway, some areas faster than others. The second thing we said is, you know what, as we go ahead and think about our current product offering, we need to work on quality, right.

And so you saw that our overall quality metrics have improved. But again, to be transparent, we have not moved the needle sufficiently in my mind on Ostomy Care, just being transparent, okay.

So, there is room for improvement there. So, I think that – let’s keep on coming back to that and work on that.

I think then there is an element of, as you think about the mix, do we have the right product offering, there is something that we had way too many dated products, a lot of complexity. So, we are trying to tackle that head on.

You see that with the SKU rationalization, right. So – and that’s going to continue.

I think we are open about that for the next couple of years. And I think there is this element of new products you are going to refresh.

And so I do think that the Esteem 2.0 on piece come back is an important element in the jigsaw puzzle. But you need to get all of these four elements to work together in a consistent manner throughout your key geographies.

So, I would say we are making progress in Ostomy Care, but it’s tough work again.

Alright. Thanks.

Thanks guys. It’s Paul Cuddon from Numis.

I have got two questions. You have called out specifically the performance in your top 12 markets, which I kind of presume would be your direct ones and a lot of markets you have exited.

But I am just wondering how your portfolio more broadly is shaping up for distributors in potentially non-core markets, whether you have got better brands now that other people are going to look to take on and potentially to sell for you specifically kind of Europe? And then secondly, to what extent Triad is baked into your kind of organic guidance, given that it’s quite fast growing and also your margin guidance for the year.

Thank you.

So, I will take the last one. Well, let me start with the last one.

So on Triad, first of all, of course, it’s not closed yet, but we hope to close Triad pretty soon. It’s a very exciting new platform we are entering into through Triad and it’s really a new and developing business.

So, it will contribute, of course, in terms of revenue. We don’t know yet exactly when it’s going to close.

So, that depends – the closing depends on how the contribution is going to be in 2022, but we are not expecting any EBIT contribution. So, in the ground scheme of things, we believe from an EBIT margin point of view in this first year 2022 is not really going to be material.

There is going to be some impact because there will be some revenue in OE, but it’s not in the grand scheme of things material in relation to our 18% guidance or at least 18% guidance.

Okay. Look, in terms of our portfolio vis-à-vis distributors, but I would say, Paul, look is we don’t fundamentally design our portfolio for distributors, right.

So, I think it’s fair to say that our portfolio is in the midst of getting stronger. And so that degree of differentiation, frankly, could be relevant to customers or patients or nurses on a worldwide basis, but there is no deliberate move in that direction.

What I would say is in global emerging markets, we will look at global emerging markets. And if there are product portfolio offerings that are particularly relevant to 85% of the world population, then we do look at that more carefully.

So, that’s the momentum that we look at that there.

Hi. It’s Patrick Wood, Bank of America.

I will give you just one really quickly. The HSG and Amcare side where the non-ConvaTec products declined, but ConvaTec grew.

Any sort of commentary around what that was? Was that just the UK with the service side, or have you been successful maybe hedging some of your competitors out and encouraging people to use your own products through that side, or any commentary around there and what was happening there would be useful?

Thanks.

Yes. Look, I mean our basic philosophy is really captured our vision, right.

So, we talk about pioneering trusted medical solutions to improve the lives we touch. So, first and foremost, we are always going to do what’s best and right for the patient, right.

And so if you look at our Home Service Group in the U.S., and if you look at it in the intermittent catheter category, there is a substantial amount of product that is not ours that we are supporting and servicing, right. And that’s a positive thing.

It’s a positive thing, frankly, for the patients, for the nurses, for the manufacturers that are working with us and frankly, for us. And so we respect that relationship.

We value that relationship, right. In the Ostomy Care side, again, in the U.S.

in 180 Medical, it does not make sense, frankly, economically to do that, and that’s clear to all the participants. So, on the 180 Medical side, in the USA, if you ask me in Continence Care, it’s basically all ConvaTec product to keep it kind of simple.

So, what’s the story then in Amcare because that was the other area you are trying to probe before. I think it’s fair to say that in Ostomy Care in the UK, the vast majority was non-ConvaTec product, right.

And the service levels were very modest. So, that begs the question like, okay, what do you do, right, so you can say, I just don’t want it or is it an opportunity.

Our view – my view is, look, the UK is the second largest market, right. We have got some really good product offering because, frankly, we are growing our business in Latin America.

We are growing our business in places in Asia Pacific. We are growing our business in Italy, Poland, etcetera, why can’t we not grow in the UK.

So, why don’t we try to improve our service levels. So personnel, leadership, software systems and offer our great ConvaTec products, and that’s exactly what we are doing.

And why are we doing that, ultimately, do you provide a better quality service and offering to patients and nurses here in the UK. So, that’s where we are at.

Please.

Hi, good morning. It’s Craig McDowell from JPMorgan.

Most of mine have been asked, but just one clarification on the guidance. Constant currency EBIT margin guidance, I am wondering whether you could give some indication of the FX impacts to the margin, please?

Best spot?

Yes, best spot, yes.

Well, that’s different every day. But – so I can give you what we think it is now.

But again, if you ask me a complication the number would be different. So, take it for what’s worth.

In terms of top line, if we would translate today we would probably have a pressure of 250 bps, okay. However, if you then go to the bottom and you think about EBIT margin, currently, we think it’s about a 20 bps increase.

So, the 18 would become 18.2 in what we think it is today as I said, very volatile, okay.

I am just sensitive to – do we have any questions from folks that are connected virtually.

Kate, you can help us out, great. Okay.

Good. Not sure if it’s being transported physically or digitally.

We are here in auditorium, by the way, UBS’ auditorium if anybody is wondering.

Thank you for taking my questions. I have couple, please.

Firstly, Karim, you talked about a strengthening competitive position and it’s increasing this year from your financial performance today. Could you run us through your assessment of the segments and where you think you have stabilized share where you think there is more to do and where you think you might actually be gaining some share and if there are any significant regional differences around this?

And then secondly, on compact catheters, could you talk a little bit about the opportunity in the U.S. versus that of Europe, given the strength in distribution that you have in the U.S.

Do you need to build out a capability in Europe and could this be more inorganic versus organic? And I also note from the slide that the female catheter launch has been pushed to 2023.

So, if you could talk us through why this is? And if indeed, any of these compact catheter launches are likely to be telescopic?

Thank you.

Yes. So, let’s just start off with the four categories.

I think it’s fair to say that in Infusion Care, the end market is attractive, growing high-single digit. We have strong differentiation.

I think we are going to continue to lead in that area. Our challenge right now is frankly keeping up with demand.

And so when you see our capital expenditures being in the $100 million-plus arena, a lot of that’s going into quality and operations and automation go ahead and meet demand, alright, and to build resilience in our supply chain. So, I think that business is a good business, I would say a very good business actually and we just need to keep on diversifying the applications in which our infusion sets are used, and I think there is opportunity to do that.

I think Advanced Wound Care has clearly strengthened its position. Commercial execution is strong on a global basis.

North America, Europe, global emerging markets. In places like Europe, we are definitely growing share, clearly growing share in emerging markets and improving our performance in the USA.

So, I would say generally, positive picture. And I think with the Triad acquisition, that bodes well for us in terms of being able to leverage our commercial infrastructure, leverage our development capabilities and frankly create a beachhead in the regenerative medicine space or arena.

So, I think that’s all positive there. In the area of Continence Care, I think we have got a very strong presence in North America, both now as a manufacturer and as a service provider, clearly, the Cure Medical acquisitions helped us with that.

And frankly, our teams in care are working very, very well together. So, I am very pleased, year post, we just assessed, frankly, how the integration has gone, and that’s a lots of green lights.

Clearly, our presence in Europe is a lot more modest. And so there, we are looking to frankly build out our capabilities.

I think that in these categories, you need to work very closely with patients and consumers and the healthcare providers. And so as we have stood up our marketing center of excellence, I think that’s creating opportunities for us to be a lot more effective and efficient in working directly with consumers and we will get – we will be able to get more in time and give you more examples of how we are doing that.

But I think that’s an important element. So, I don’t think that necessarily it’s going to require significant M&A activity to build out that commercial infrastructure, but we are building it out, and that’s frankly reflected also in our outlook statement as to where our investments are.

And I made the comment before, we are going to be investing in marketing and sales, that would be one area, for example, would be European commercial. Is there an opportunity for compact catheters in the USA, I think the short answer is, yes.

That segment is significantly smaller than the European context for a variety of reasons, which we could get into. But it’s a rapidly growing segment in the U.S.

today. So, we do see the opportunity for our GC Air male and female to be utilized in the USA.

And so that’s an important and attractive opportunity for us. In terms of GC Air male and female, we think we need a full portfolio.

As you may recall, historically, we had looked at launching these products earlier, they weren’t ready for lunch, okay, just going to call us betas. And what I mean by that from a design perspective, from the ability to scale it up and be cost competitive, right.

You are making high-quality, high-volume consumables here. And so frankly, the GC Air female required a significant redesign, which we feel very good about.

And that’s why you see the timelines the way they have been positioned at this point in time. I hope I answered your questions, Hassan.

That’s helpful. Are you able to give any color on when – whether any of these catheters are likely to be telescopic?

I prefer not to comment right now for competitive reasons. Let’s just say that the feedback that we have got and received both from healthcare providers and from consumers, I would say, is very positive.

Okay. Perfect.

And then if I can squeeze one more in on just on the top line guidance and your confidence here. I mean we have been accustomed the conservatism from you on the top line recently.

So, I am wondering where you could potentially see some upside to the top line?

I mean, look, I mean I think the reality is we all try to build our forecast, right. I think there is a fair amount of uncertainty.

I think for us, what’s important is let’s just deliver, honestly, right. I mean I think things are improving, but I would also give a fair balance.

There is still a fair amount of work to be done. And so I think it’s important to acknowledge that.

So, could you build scenarios, I think you could. Could you build scenarios in the other direction, you probably could also, right.

So, I think let’s just stay grounded right now and focus on delivering.

Thanks a lot.

Any other questions here in the room?

Okay. Super.

Look, I just want to say a big thank you to all of you who participated both virtually and in person. We really appreciate all the interest that you have shown in ConvaTec, stay tuned.

And as we have said, we are very, very committed to pivoting to sustainable and profitable growth, and we will be in touch. So, thank you very, very much, and have a wonderful day.

Thank you.