Thank you, operator.
the our so we Safe in your will begin. not to attention Harbor is office I today, call Skyler statement before
statements relating to Please will business. plans, this during our and regarding forward-looking projections performance note expectations, our financial call, the current that make we
involve results statements forward-looking to from discussed today. they differ view uncertainty that today only, as materially These and of could our and reflect risks cause actual those
our those could other that to actual statements projected our or in cause pandemic by the reports SEC and from factors Important and and differ most implied impact the on include COVID-XX results to of forward-looking with XX-K global included business are our uncertainties materially recent related the risks filed results.
undue this we forward-looking place reliance We on morning. caution make not statements you to
to We forward-looking or update undertake revise no statements. obligation
During drive we will will operator of we our our and recent over and we sales posted of Officer. are highlights everyone, provide company’s expectation. Krier the few our a growth baseline lines recent growth X now to available webcast and slides the call just rates the highlights John Chief sales the call, market for financials, more the commentary turn viewing all today’s referring and phone dynatronics.com. Investor morning, will that achievements. the the open Norm on Norm. be to and our the today. in Thanks, which of and cover then have joining President exceed Relations questions. accomplishments, Slide John section Dynatronics Krier, for the will On in prepared for thanks Good Executive will I to remarks, call
with three headline me begin Let points.
sight growth a strategy we clear a against. line have well-defined foremost, and to profitable of to execute and First
consistently quarter have each been achieve business goals. an performing to our transformation and executing ongoing We
We we guidance sales our midpoint today. year our confident in of the Second, XXXX are increased outlook. fiscal net
the fourth quarter and guidance market and baseline of third exceeding the for our fifth our and sales the quarters sales quarter consecutive are fourth Our expectation. sales
from And generate the year. with growth than organic market X% organic Our generate. accelerating continue COVID-XX. growth disruption the continues new our resulting even markets greater-than-expected releasing to plan in and products impact our take the faster of to We growth transformation share collective X% X% to per to X% third, markets
X. Slide to Moving
with We will the midpoint confident choppy continue and guidance to transformation that of updated range guidance our the are while We this nature guidance metrics impacts of we raised provide on and COVID-XX. business our today. managing
set current baseline of XXXX sales relative guidance We sales million continued April to XX.X% to expect to $XX year midpoint The range $XX the net growth organic annual and a represents the be chain million, COVID-XX net in product cases this sales in of million XXXX. fiscal supply assuming conditions impacts. $XX rate on in
bounce highest and the third distribution our lower positive demonstrating This sales fourth midpoint fourth us of target increase building net Customer the across align quarter. continued of with the the be Dynatronics XX.X% our same product XXXX relative expects back sales results sales compete. sales net million pattern continues QX. and the million, favorable markets to Our and tailwinds the overwhelmingly quarter, and net historical updated with fiscal in the second last quarters The business the matched to in in year. in the expectation of strength strategy period QX we trends, in to planned quarter year the in company a quarters our in providing is dealer upon $X.X in a transformation model first to new reaction $XX.XX momentum,
by target we only growth in of continuing sales year sales X% market to XXXX. to maintain we should We growth take discussed and have fiscal releasing deliver new X% products. annual net We market if share, annual share net higher
quarters, sales response in driven We $X.XX sales above growth levels and four business the transformation, volume-tiered built. sales have above continued serve inventory in million growth to market set our customer We inventory quarters our our is consecutive April baseline in pricing, been higher expected to in fiscal well XXXX. three double-digit each have first that demand growth product delivered growth. The XXXX on invested sales strategic and year of of double-digit
utilization Our have improvement context, delivery three demand and market appropriate more QX current raw shipment chain costs, customer material margin strategically and in costs, current that and target quarters. elevated inventory the over sequential conditions. times. The to is assumes conditions of provide To past built our in been inventory chain supply meet on levels supply handling is disruptions gross and expected the
I new On drive XX% supply currently inventory sales disruptions were demand, or to is and started volume XXXX. expected help $X.X serve chain the higher when expected than we stock offset product safety These fiscal continued specifically to to additional higher customer discussed, designed million introductions. year add investments
the The to are we products operating of $X.X activities first competitive in challenged to in a cash Importantly, QX. our used advantage and anticipate chain strategic environment. customers supply the in months. investment is to are Customers that nine That during continue getting million fiscal rewarding last for the quarters inventory with was the months year challenges in primarily caused nine those three had inventory incur organization of due million company’s XXXX cost. of The capital have the we to over additional that. working $X.X
improved issues Inventory throughput until We levels levels remain supply inventory to will the see chain in elevated with levels. the place. global return pre-pandemic across to expect
in we improved QX short-term XX.X%. This increase margin from of Slide implemented. the price focus. the increases to margin to expansion because improvement sequential of came primarily remains Turning that gross X. Gross X.X% our XX.X% QX, a margin Gross
price from while operations quarters. built Our three gross should been margin in that to has flow products, our our strategically over benefit benefit the from QX continue our cash should from increases inventory past for
that As manufacture. a margin, higher on we company, we focus products differentiated
achieve. over longer margins the believe what gross term, XX% which our to achieve comparable to is target is Our peers we
year extraordinarily they segment, XXXX bracing for for and materials our out by been recently we When example, fiscal costs the in acquired and pressures, and as high spun margin of rehabilitation impact freight, Ossur. chain COVID-XX would support by of before QX Colfax of competitors, of the Without margins were quarter margin out For result to XX%. challenges, XX% roughly labor Enovis materials and of muted have approximately and labor maintain and standalone XX.X%. COVID-XX additional raw DJO, supply raw including each the costs. Gross in and gross was and inflationary the freight, break you experienced a our bracing
quarter relative to the year higher XXXX these prior Excluding of fiscal gross additional year. was costs, each our margin in
multiple alternate taking selective sourcing actions are and price yields. costs, offset improving We including these to increases, relationships exploring factory
long-term heavily as our We that Dynatronics are markets. companies in does agreements other not many as fortunate rely on
As while price XX% in these a sales pressures. we fiscal to giving offset our for of the discussed SG&A guidance products cost more general challenges year excellent our price cost XX% input result, time. share increases. net and the in fiscal our anticipate anticipate details. net year I minimize can inflationary the will team increases, range of margin and Slide option buy to from pressures and and guidance over customers XXXX. XXXX selling, We year cost XXXX, higher some in with to of them through dealers us the X increases sales year QX example that We fiscal appropriately XXXX. face of we gross managing target expenses was net mounting fiscal administrative sales of an provides
on our to we gain leverage revenue we scale improve scale, continually this expect and cost base. As SG&A
customers. going from We’re do to takes to it what our serving keep demand
eye steady and the is a consistently margin build There presentation to a metrics. operations with company grow continues filings of risk value from opportunity deliver on this vision and forward-looking in is our have our on uncertainties larger markets, in current and statements an the financial and shareholders. and the We SEC. be in base strong operations guidance subject all improve to cash expansion and to based customer our for our create scalable our factors platform contained to to a company’s deliver other to sales to flow This much
X. our driving great platform. and proud Turning I to these past quarters. momentum several context bullets growth to results I’m we generate. Slide sustainable of the provide the the our is strategy the over of our to important work team want to Each of
is Our short-term focus achieve XX% expansion, term. target margins is gross to over on longer the our and gross margin
Our continues. transformation
growth. net We annual expect that from long-term the over that operating time, these flow changes sales, operations gross will and sustainable enable cash income, deliver higher margin,
X. Slide to move Let’s
The levers consecutive at We X% attractive capturing sales about product continued set above and are have a four growth to developing market in XXXX. These market sales two our acquisitions. profiles, level, markets $X.XX sales to And share, April serve growth. growth innovations product drive quarters, well for X%. we delivered million baseline growth exhibit macro our above each
market In take addition products that faster share X% from than to to will growth this growth, grow us this competitors, market to plan to continue X% we our organic introduce to rate. enable new
and $XX and continue and to fiscal the available market customers million annual do and business product initiatives moving markets. and total Slide our improvements easy turn and four superior Please driving commercial customer two, rewards is to By on XXXX approximately billion end with quarters. delivering macro our loyalty Dynatronics. goals, million sales Importantly, reasons rehabilitation make innovations customer $X have is net domestic the their remain for on We $XX mix the supports product That and year focused to bracing within dealers through: X customers’ volume-tiered market in win give sales. make as as the consecutive we innovations. build our revenue possible offering discuss to to delivered favorable life winning that shift experience end it to these share. now dealers share We will execution, pricing us; growth I on in to level. double-digit one, market and dealer that delivering easier
product build number new of our drove XX. to and products of revenue about we was and and January Moving of additionally recent launched the releases. launched typical a XXXX. new cadence the orders, small innovations; one, there these umbrella XXXX, fiscal products of XX, ramped product shipments, are: the expanded immaterial metal product our three new of quarter new were dealer an up at to metal XXXX. line third January customer under then and from Slide Due time tables; on three end pipeline in Return The products the exclusive year three, impact Mobility, feedback for and The tables to two, takeaways suite
in our products acceptance QX, While demonstrates the quarter, plan. We immaterial higher expectations third the XXX% this than drives market line To believe the over revenues that our baseball Mammoth the exceeding baseline Mammoth to expect net on in important contributor corporate-wide was time. growth in time. these the new more every was metric become sales booked term, over impact orders a a almost and our a were of launch it to use single
he Operating Operating at Brian Chief served Dynatronics Brian to XXXX. January management August Slide that our relating has due when held health recovered Executive Baker the May promotion from XX. our Looking Thankfully, Brian position accepted COVID-XX Officer resigned XXXX opportunity as rejoined COVID-XX. until virus, Officer delighted to he time. I XXXX. in he until issues time when Chief from his Officer rejoin July team as in was full Chief XXXX, to full the to and
have As Dynatronics. at new a been area hires you focus can leadership see, major
The within rehabilitation are a primary the and which implemented fragmented. XX. serve as Dynatronics across organic to markets well within sales and customers consistent Opportunities industry continues markets product and focused the as at existing We X%. introduce support expand brands attractive accountability on overall On our indicate growth exhibit X% and profiles, of segments additional in also about that to highly bracing The share research we exist and that offerings to we growing the profitability. compete. employees market to large, each growth company culture Slide of
in based XX. As we for other reading procedures are Slide or staffing likely statistics that serve, activity orthopedic markets demand are the facility our about of volatile shortages. COVID-XX on Building move to peripheral foundation sports all and let’s the we products create experiencing on and activities activity, the team like
here strategy an you detailed Our is M&A look for. to idea of what give we
We to ventures. have business conversations pursue continue acquisitions, partnerships and innovation and other
on execute our to team criteria. leadership the have meet well-defined that any We
within greater gross year. flow first focused criteria contribution Our cash margin include than XX% and the
our on Our focus is markets. current
over will balance to to is are million targets lower range. Norm. smaller of bank to call $XX prefer the debt at a because near-term believe our price want Our equity unlock than revenue We make I using turn we $X million undervalued the of to value. the and now or end some our acquisition that sheet share rather
