2025 Growth Expectations
Q: What's the outlook for 2025 growth and margins?
A: Management anticipates improved organic growth in 2025 as the business emerges from current disruptions like the cybersecurity incident and PPE headwinds. They expect continued market share gains, especially in specialty products like implants and endodontics, and believe the fundamentals of the business remain intact. The restructuring program will contribute savings, with benefits starting in the fourth quarter of 2024 and continuing into 2025.

Manufacturer Relationships
Q: What's the status of your agreement with Dentsply Sirona?
A: Management affirmed a good relationship with Dentsply Sirona, noting they are likely Henry Schein's largest customer while Dentsply Sirona is one of their biggest global suppliers. Although not disclosing specific contract details, they emphasized mutual commitment and ongoing collaboration across multiple countries.

Customer Recapture Post-Cyber Incident
Q: Why expect customer recapture after cybersecurity incident?
A: Management is confident in recapturing customers lost after the cyber incident, citing sequential month-over-month improvement. Sales teams are re-engaging smaller accounts, and outbound calls have resumed in the last six weeks. They believe customers are receptive and expect to continue regaining market share over time.

Current Business Trends
Q: How are trends in July and Q3 so far?
A: The positive momentum from Q2 has continued into July. Distribution businesses are experiencing growth as they recapture market share. Management expects this trend to persist throughout the third quarter and into the fourth quarter as well.

Shift to Private Label Brands
Q: Is shift to private labels affecting guidance?
A: The move towards corporate brands is embedded in their guidance. Customers are more cost-conscious, opting for lower-priced options, including Henry Schein's own brands. This shift may slightly depress sales but is positive for gross profit margins.

Implant Business Growth
Q: What's the growth outlook for implants?
A: The implant business is performing well in Europe, particularly in Germany and France, where they hold strong market positions. In the U.S., growth was slower due to pending FDA approval of a new product, but approval was received in mid-June, and they expect improved performance as they launch the product.

Medical Customers Ordering Elsewhere
Q: Are large medical customers ordering away?
A: While some large customers temporarily ordered elsewhere, most have returned, including one large customer resuming pharmaceutical orders. The focus is now on re-engaging smaller practices where sales teams haven't had time to reconnect. Overall, they expect recovery in this area.

EPS Guidance for Second Half
Q: How should we think about H2 EPS guidance?
A: Management expects to maintain momentum in market share gains, with contributions from specialty and technology businesses. The guidance reflects continued growth in the second half, supported by initiatives like the new implant product launch in North America.