Good day, and thank you for standing by. Welcome to the Owens & Minor third quarter 2022 earnings conference call. At this time, all participants are on the listen only mode. After the speaker presentation, there'll be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, to Alex Jost, Director, Investor Relations. Thank you. Hello, everyone, and welcome to the Owens & Minor third quarter 2022 earnings call. Our comments on the call will be focused on the financial results for the third quarter of 2022, as well as our outlook for 2022, both of which are included in today's press release. The press release, along with the supplemental slides, are posted on the investor relations section of our website. Please note that during this call we will make forward-looking statements. The matters addressed in these statements are subject to risks and uncertainties, which could cause actual results to differ materially from those projected or implied here today. Please refer to our SEC filings for a full description of these risks and uncertainties, including the risk factor section of our annual report on Form 10-K and quarterly reports on Form 10-Q. In our discussion today, we'll reference certain non-GAAP financial measures and information about these measures and reconciliations to the most comparable GAAP financial measures are included in our press release. Today I'm joined by Ed Pesicka, President and Chief Executive Officer, and Alex Bruni, Executive Vice President and Chief Financial Officer. Andy Long, Executive Vice President and Chief Executive Officer of Products and Healthcare Services, will be joining us for the Q&A section. With that, I'll turn the call over to Ed. Ed? Thank you. Good morning, everyone, and thank you for joining us on the call today. I'd like to start this call by addressing the factors that were in line with our expectations, as well as the unanticipated factors that drove the recent change in our outlook. While there were some new challenges, combined with the continuation and acceleration of existing challenges, many key aspects of the third quarter occurred as expected. Starting with one, we continued gaining momentum in our Patient Direct segment, growing organically in the mid to high teens across all major categories. We also continue to see improvement in our ability to access equipment, which allowed us to meaningfully reduce our overall backlog of orders in our sleep product line. Two, as planned, we successfully onboarded new acute care customers in our Products and Healthcare Services segment, with the investments made in Q3 and Q4 providing benefits in the future. Three, as a result of our investments in predictive analytics, AI, and inventory optimization, we continue to improve our already market-leading service levels. Four, as expected and discussed last quarter, procedural volumes in Q3 were soft and well below the 2019 pre-pandemic levels. Now let me discuss the unanticipated factors in Q3 that drove our recent change in our outlook. One, as the third quarter progressed, we saw more and more of our acute care customers delay reorders, choosing to deplete their stockpiled items, including our higher margin S&IP products. Simply put, our previous guidance did not factor in. Ladies and gentlemen, please stand by. Your conference will resume momentarily. Please continue to hold. Your conference call will resume momentarily. Hello, this is Ed Pesicka. I I apologize about the connectivity issues, but let me continue back to where I left off at. Now let me discuss the unanticipated factors in Q3 that drove the recent changes in our outlook. First, as the quarter progressed, we saw more and more of our acute care customers delay reorders, choosing to deplete their stockpiled items, including our higher margin S&IP products. Simply put, our previous guidance did not factor this in as an assumption. Second, from a macroeconomic standpoint, the Federal Reserve actions were more aggressive than expected. The U.S. dollar strengthened and fuel prices reversed course and began to increase towards the end of Q3. Three, as we ended the third quarter, we concluded that the execution and velocity of the actions we were taking in our product and healthcare services segment were insufficient to offset the future impact of macroeconomic headwinds as we successfully had done in the past. Finally, while we were beginning to see slight improvements in procedural volume, we did not see the extent of the ramp-up of procedural volumes we expected at the end of the third quarter and into Q4. Accordingly, we have made changes to address these shortfalls, and the good news here is that there are numerous short-term and long-term opportunities in this segment that will allow us to operate more efficiently and more cost effectively. Here are just a few of them. One, we will continue to leverage our industry-leading service levels. This has helped retain existing customers and win new business with attractive customers. This is an important distinction since, as we have said in Q1 and Q2, not every customer is going to make financial and operational sense for us. We remain focused on profitable growth. Two, we are refocused on expanding our portfolio of products which provide longer term benefits. Three, we are implementing changes in the way we incentivize our sales team to drive proprietary product penetration and conversion along with supporting our key supplier partners. And finally, going forward, we will more aggressively implement the Owens & Minor Business System into this segment. Simply put, we must execute better and faster. Moving on to the Patient Direct segment. The effectiveness of our business system is readily apparent in our Patient Direct segment. We have experienced many of the same macroeconomic pressures on this side of the business as well, but have been able to offset some of these same challenges. The difference is simply in the execution. In the third quarter, our Patient Direct segment achieved organic revenue growth in the mid to high teens across sleep, diabetes, urology, ostomy, incontinence and wound care. On a pro forma basis, this segment grew at 11.4% year-over-year. Also, our ability to procure sleep equipment was better than expected, which enabled us to grow our census of sleep patients and meaningfully reduce our backlog of orders. This highly recurring revenue base will compound nicely as we head into 2023. With the backlog of sleep patients clearing and the patient census growing, we will see more sleep supplies sold in the future, and this will benefit the bottom line. Finally, from an integration and synergy perspective, we are ahead of our internal targets. Overall, the Patient Direct segment will continue to be a larger and larger portion of the total company earnings and cash flow. We believe that the attractiveness of this faster-growing, higher-margin segment is overlooked by the market, and the near-term and long-term perspectives of this segment is very exciting. Before I turn the call over to Alex to take you through the quarterly financials and our recently revised outlooks, I want to emphasize a few points. First, our commitment to the hospital customer and our industry-leading service is paying off in new wins. Again, we will remain selective in pursuing the share gains that are most impactful to the bottom line. Next, the use of stockpiled items for current activities by our customers is temporary, and as these stockpiles are depleted, demand for our S&IP products should return to normal. 3, you will see a more rapid and fulsome deployment of the Owens & Minor Business System in the Products & Healthcare Services segment. 4, I believe there will be an even greater appreciation for the strength and steadiness of our Patient Direct business. More and more of our earnings and EBITDA will be coming from a Patient Direct segment, and I believe the recurring revenue nature and growth rates of the segment will become properly valued. Finally, I am confident that our core business fundamentals remain strong, and we have the correct strategy across both business segments. With that, I will turn the call over to Alex for discussion of our financial results. Alex? Thank you, Ed. Good morning, everyone. It's my pleasure to be with you today, and I look forward to meeting many of you in the weeks and months ahead. Today, I'll review our financial results and key drivers for our performance in the third quarter and then discuss our revised expectations and assumptions related to the full-year outlook. First, let me start with our third quarter results. Our revenue in the quarter was $2.5 billion, virtually flat from the prior year, driven by the contribution of Apria and strong organic growth within the Patient Direct segment, offset by lower revenues within the Products & Healthcare Services segment. Gross margin of $513 million or 20.6% of revenue was up 740 basis points from prior year. This growth was driven by Patient Direct and reflected the contribution of Apria sales and sales mix within that segment. Year-over-year for Q3, foreign currency negatively impacted revenue by $12 million, gross margin by $6 million, and adjusted operating income by $5 million. Distribution, selling and administrative expense was $445 million, driven higher primarily from the addition of Apria expenses and ongoing inflationary pressures, partially offset by operating efficiencies and productivity gains derived from the Owens & Minor Business System. Interest expense was $40 million in the quarter, which was $28 million higher than prior year, driven by the debt financing of the Apria acquisition in late March. As a reminder, floating rate debt represents approximately 1/3 of our overall borrowings, inclusive of our interest rate swaps. The GAAP effective tax rate this quarter was 36.2% compared to 12.6% in last year's third quarter. The change in rates resulted primarily from the mixture of income and losses in jurisdictions in which we operate, as well as the prior year's utilization of foreign tax benefits. Our GAAP net income for the quarter was $12 million or $0.16 a share. Adjusted net income for the quarter was $31 million or $0.41 a share. Third quarter Adjusted EBITDA was $127 million with a margin of 5.1%, up 140 basis points versus the prior year. On a segment basis, Products & Healthcare Services third quarter revenue was $1.9 billion versus approximately $2.3 billion last year. This change was driven by approximately $110 million of lower glove cost pass-through, as well as reduced hospital demand and customers' reliance on existing stockpiles. Products & Healthcare Services adjusted operating income for the quarter was $24 million compared to $64 million last year, and this change was attributable to the factors just discussed, along with accelerating inflationary pressures. Turning to Patient Direct, this segment had an excellent quarter. Net revenue in the quarter was $594 million, an increase of 142% year- over- year, growing 11.4% on a pro forma basis, with strong double-digit growth across key product categories and aided by our better-than-expected ability to procure sleep equipment. Adjusted operating income for the quarter was $60 million compared to last year's third quarter of $15 million. The synergies we are generating within our Patient Direct business are tracking ahead of expectations, and we continue to expect Apria to add over $900 million of revenue and over $180 million of Adjusted EBITDA for its nine months of contribution in 2022. In the next few years, we continue to expect deal synergies to add incremental annual revenue of $80-$100 million and incremental annual Adjusted EBITDA in the range of $40-$50 million. Moving now to cash flow, the balance sheet and capital structure. This quarter, we generated $69 million of cash from operations, and on a year-to-date basis, we have generated $238 million. Free cash flow, defined as Adjusted EBITDA less net capital expenditures, was $84 million in the quarter and just under $300 million through the first nine months of 2022. During the quarter, we further reduced net debt by $35 million, and we were comfortably within all debt covenant requirements. Leverage reduction remains a top priority, and there is no change in our target net leverage ratio of 2-3 x. Now let's look at our current guidance. For the full year 2022, we expect net revenue to be in a range of $9.8 billion-$10 billion, Adjusted EBITDA in a range of $527 million-$537 million, and adjusted EPS in a range of $2.50-$2.60. As we look at the key drivers of this revised outlook versus the previous guidance, there are a few items to note. First, we have reduced our revenue assumption by $50 million at the midpoint. This decrease reflects our new assumptions on softer Q4 procedural volumes and factors in the recent trends in customer reordering. As we mentioned, over the quarter, we saw more of our acute care customers delay reorders, choosing instead to deplete their product stockpiles. Given this, we are expecting a much different sales mix in Q4 than we had previously projected. This is driving the majority of the $0.45 reduction in the midpoint of the adjusted EPS guidance for the year. Expected interest expense for the year is slightly reduced to a range of $128 million-$130 million due to ongoing debt management and continuing to lower average daily debt levels, partially offset by higher interest rate assumptions. For a complete summarized list of modeling assumptions, please refer to the supplemental slides filed with the SEC on Form 8-K earlier today, which we've also posted to the investor relations section of our website. Looking farther ahead, we are in the midst of our normal budgeting cycle, which will put us in a position to discuss our outlook for 2023 in the first quarter. As we've discussed, the changes to our outlook for this year came as the result of some unanticipated challenges, and without question, we are very focused and have a renewed urgency to address these issues. There were also many positive takeaways from the quarter. We are very proud of our service quality and new wins and successful onboardings within the Products & Healthcare Services segment, and we remain very excited about the performance and outlook for the Patient Direct segment. Thank you. At this point, I'll turn the call back over to the operator to begin Q&A. Operator? Thank you, sir. As a reminder to ask a question, you need to press star one one on your telephone. Please stand by while we compile the Q&A roster. Our first question comes from the line of Kevin Caliendo from UBS. Please go ahead. Hi. Good morning, everybody. It's actually Andrea Alfonso for Kevin. I guess if we could just get a little bit more granularity around, you know, your expectations for the run rate of margin and products in 2023. If I could just slip one in, you know, would appreciate a little bit more color on your thoughts around sort of the sleep apnea backlog and how we should think about that manifesting in the numbers into next year. Thanks so much. Sure. I'll start. This is Ed. I'll start with the second part of the question and have Alex, you know, talk a little bit about the projection going forward. You know, and I think the way to think about the sleep product is, you know, we had a very strong quarter in sleep. You know, we were able to, you know, basically get access to additional product. The team executed extremely well on it, and frankly, we took our backlog down back to almost close to where we're sitting now today, closer to normal levels of what we'd anticipate. You know, while we had anticipated the depletion of that backlog to lead us into Q1 of next year and early part of 2023, we actually were able to capture most of that business now because of the additional capacity that we received or additional volume we received, and frankly, incredible execution on the team's part to get those products out. How does that manifest into the future is obviously placing the equipment is one thing. It's now that recurring revenue will start to occur in Q4 or late in Q4, 'cause generally they get a 90-day supply with the initial deployment of the product. that recurring revenue will start to continue to flow throughout all of 2023 versus where we originally thought, you know, we would fill those equipment orders into 2023 and then start to gain that. So it's really been, you know, strong execution on the Patient Direct team, you know, focused on partnering with those sleep manufacturers, getting the product out to get us ahead of the curve, you know, and really get our back orders and backlog on that back down to what we would see as a normal rate where we sit today. you know, let Alex cover a little bit on the first part of the question on kind of standard run rates on where we are in the process. Thanks, Ed. Good morning, Andrea. Within PHS, the trends that we've seen here in Q3, we do expect to continue at least in the short term through Q4, and I think that's reflected in our guidance. As I mentioned, we are in the middle of our budget process and do expect to have greater visibility in the first quarter. You know, the markets continue to be very dynamic, and we'll work that through over the next month or so. Thanks very much. Thank you. One moment for our next question. I show our next question comes from the line of Daniel Grosslight from Citi. Please go ahead. Hi, guys. Thanks for taking the question. You know, it seems like most of the pressures you're facing are macro in nature, but you mentioned that there are specific actions you didn't take quickly enough and you're going to begin implementing. I'm wondering if you could put just a bit of a finer point on what specifically you can do in the near term, given these macro pressures don't seem to be abating anytime soon, and how quickly that will manifest in more normalized margins for the products and solutions business. Sure. Yeah, I'll take that. Really it's both a mix of macro as well as some of the industry specific that we're seeing. You know, I talked a little bit about the destocking. You know, that's having a material impact on us here in Q3 and then extending into Q4. You know, and that's really the fact that, you know, hospitals are under financial constraint. They have a tremendous amount of stock on hand of PPE, which historically they haven't had. They're electing to utilize that versus restocking. They're using their, quote, safety stock to bleed down inventory, which is having a material impact on us. You know, I think on the macroeconomic side, you know, there's several different things with that we're in the process of doing. You know, some of those things offset the macro impact. You know, one is route optimization. You know, as fuel prices continue to go up, there's still tremendous opportunities for us to maximize and optimize our route optimization within the customers, you know, and that's gonna take a period of time to work with our customers from a delivery standpoint. You know, there's additional, you know, really embedding the Owens & Minor Business System within our Products & Healthcare Services segment. You know, there's ability for us to continue to take cost out of that business aggressively, you know, by driving continuous improvement. I think the way to really look at it is compare and contrast the two segments. You know, many of the same macroeconomic pressures impact Patient Direct that impact our Products & Healthcare Services segment. Our Patient Direct, you know, through the embedding of the Owens & Minor Business System, have been able to quickly take cost out of that system to be more effective. That same implementation has to happen on the other side of our business on the Products & Healthcare Services segment. You know, the other thing I would talk about to really, you know, continue to look at offsetting some of the macroeconomic is looking at the labor force. You know, one of the things we had anticipated coming into Q3 and going into Q4 was a stabilization of the labor. You know, we didn't see that in Q3 and Q4. You know, however, we actually believe as the economy continues to tighten, you know, the labor force, you know, will create opportunities for us to have a better labor force and then keep our employees and teammates for a longer period of time and reduce that turnover. That's another aspect of it, continuing to look at ways where we've identified of how do we reduce the turnover of our teammates in our distribution centers so that way we can have well-trained teammates that are much more effective than new hires. That's another aspect of how we're thinking about it. Thanks. Appreciate the color. If I could slip one more in here. You know, you mentioned a lot of the margin pressure within products and solutions is due to product mix as well. The higher margin products just haven't come back as much as you expected. You know, given you had generally seen higher margins within your proprietary products business, does this mean you're really seeing most of the pressure within proprietary products rather than the core distribution segment? Yeah. I think that's the right way to think about it. You know, and really it comes down to this, you know, while we're winning customers, we're continuing to grow, you know, in our general distribution business, the one area we're seeing today, primarily our proprietary S&IP products, you know, we're seeing less and less demand. We're not seeing utilization go down in the hospital of the product. We're actually seeing hospitals reduce their purchasing of those products because they have a stockpile, you know. That's one of the things that's fundamentally changed, you know, during COVID over the last two years, you know, many of our customers went out and bought product from us, from other manufacturers, and then directly anywhere they could find the product. They built those products up in a stockpile, you know, and now they're electing to actually utilize those products that are in their stockpile, deplete those down to a lower level, and then that's when the recurring revenue will start to happen and increase again in our products business, specifically, you know, the PPE-based products. Thanks. Appreciate the color. Thank you. I show our next question comes from the line of John Stansel from J.P. Morgan. Please go ahead. Hi, this is John on for Lisa. Thanks for taking my question. I just wanna dig in a little bit on the synergies that you're seeing. I think you called out kind of ahead of schedule, but if I was hearing kind of the commentary correct, about the same amount, that $40 million-$50 million of EBITDA contribution. I guess my question is, are you seeing a more than expected just synergies from your overall integration? I guess, how should we think about that going forward? Yeah. The answer to that question is absolutely, we are. You know, again, you know, I've watched the Patient Direct business come together, Apria and Byram. I've watched them, you know, both collectively embrace and embed the Owens & Minor business system. You know, we've watched them continue to grow. You know, if you think about the growth rate, I think Q2 pro forma growth rate was approximately 10%. Q3 pro forma growth rate is 11.4%. Just think about that, the ability to cross-sell, the ability to identify opportunities. You know, I would say there's synergies on both sides, and the fact that we've embraced the fact that, you know, Byram has learned from Apria and Apria has learned from Byram. You know, Byram has effectively, you know, done some of the things that have made Apria successful, and Apria has done many of the things that has made Byram successful. Again, you're seeing that in growth, that again, pro forma last quarter, this quarter was 10% up to 11.4%. You know, you're seeing that in operating income overall. I believe it went from 9.1% to 10%, you know, adjusted operating income as percentage. So you're seeing margin expansion. Again, that is driven by cost elimination. That has been driven by, you know, better operational effectiveness. That is driven by top-line growth. I think it's also important that with the synergies, you know, we're seeing growth not just in one category, two categories, but virtually all major categories grew at double digits. Those are the quantitative examples that are validating the synergies and continuing to drive the adjusted operating income margin expansion as well as the accelerated top-line growth. Great. Thank you. Thank you. I show our next question comes from the line of Joanna Gajuk from Bank of America. Please go ahead. Hi, this is Joanna Gajuk on for Michael Cherny. Thanks for taking my question. Can you talk a little bit about the competitive environment and any impacts that, you're seeing from a share perspective versus peers? Yeah, from a competitive environment, I mean, all the businesses are different. Obviously, we've got a manufacturing business, we've got a distribution business, we've got a Patient Direct business. I believe that, you know, if I take those in the other order, you know, our Patient Direct business continues to grow, you know, again, I said at 11.4% of pro forma and really in the high teens or double digits across the board, I should say, within all major categories. I like to believe that in those markets we're playing, we are continuing to grow at or above market. You know, I would say also within our medical distribution, we continue to see new meaningful wins come into our business. But I'll also qualify that is in the fact that, you know, we're continuing to look at, you know, the right wins and retaining the right business. You know, we look at it as is there meaningful losses, and can we gain meaningful wins? Across the board, you know, I would say we're gaining some very meaningful wins with the opportunities for those to continue to grow. You know, we're also doing, you know, putting together programs with our medical distribution business that when we win customers, you know. A great example of that is one of the recent announcements we had in WVU. You know, that's not just an opportunity to win there, it's to grow in the entire state with the footprint we're adding and then the geographic states around that. That's where I say there's great success on that. You know, I would say in the PPE space or in our proprietary products, you know, I think the destocking isn't just affecting us, it's affecting many others in the market too, that are in this space. You know, as we look at our contracts across our customer base, we continue to maintain those. You know, we continue to have expansions of new customers coming onto our PPE or coming onto our contracts for our PPE. I think across the board, we're doing extremely well. Great. Thank you. Thank you. I'm showing no further questions in the queue. At this time, I'd like to turn the call back over to Mr. Pesicka for closing remarks. Thank you. Well, first, you know, I just wanna thank everyone for joining us on the call today, you know. Before I end the call, you know, I wanna reiterate a few key points that I wanna make sure we all take away from today's conversation. You know, first, at Owens & Minor, we are completely committed to our customers and continuing to provide industry-leading services. You know, that service level we're providing continues to deliver on new wins for us. We're gonna continue to focus on, as I just stated in the previous question, the right growth going forward. Second, you know, really the stockpile issue. You know, we've got customers that have a tremendous amount of product stockpiled. You know, we're seeing customers utilize that stockpile. I met with a customer most recently that had been burning through their stockpile and now is completely through it. Met with other customers that validated, yes, we're utilizing some of our stockpile to offset, you know, some of the financial woes. You know, as that stockpile is depleted, you know, and it's not gonna last forever, that demand for our product exists. It still exists, and they're using those products today. You know, next, you're gonna see really an increased intensity around the Owens & Minor Business System and our Products & Healthcare Services segment, you know. Finally, we've talked about this back in Q1, Q2, and in various, you know, open communications. You're gonna continue to see a mix shift at Owens & Minor, where more and more of our earnings and EBITDA are gonna come from the Patient Direct segment. You know, I really believe as people understand that segment, it has tremendous recurring revenue nature as well as it has higher growth, and it's a more profitable segment than our Products & Healthcare Services segment. You're gonna continue to see that mix shift as we go forward. You know, and finally, you know, over the long term, you know, I am completely confident that our core business fundamentals remain strong, and we have the correct strategies across both segments. I wanna thank everyone, and I look forward to sharing our progress when we report our fourth quarter results in early 2023. Thank you. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.