| Segment/Metric [USD Million] | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 |
|------------------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| **Healthcare**               | 769.1  **[0001757898-23-000001_ste12312022ex991.htm:1]**  | 884.6  **[0001757898-23-000004_ste03312023ex991.htm:1]**  | 818.9  **[0001757898-23-000010_ste-20230630.htm:32]**  | 870.1  **[0001757898-23-000012_ste9302023ex991.htm:1]**  | 916.2  **[0001757898-24-000001_ste12312023ex991.htm:1]** **[0001757898-24-000002_ste-20231231.htm:40]**  | 1,007.9  **[0001757898-24-000005_ste03312024ex991do.htm:1]** **[0001757898-24-000005_ste03312024ex991do.htm:17]**  | 901.2  **[0001757898-24-000014_ste6302024ex991.htm:12]**  | 944.2  **[0001757898-24-000017_ste9302024ex991.htm:0]**  |
| **AST**                      | 222.0  **[0001757898-23-000001_ste12312022ex991.htm:1]** **[0001757898-23-000002_ste-20221231.htm:31]** **[0001757898-23-000001_ste12312022ex991.htm:16]**  | 239.1  **[0001757898-23-000004_ste03312023ex991.htm:1]** **[0001757898-23-000004_ste03312023ex991.htm:12]**  | 233.1  **[0001757898-23-000010_ste-20230630.htm:32]**  | 235.1  **[0001757898-23-000012_ste9302023ex991.htm:1]**  | 234.9  **[0001757898-24-000001_ste12312023ex991.htm:1]** **[0001757898-24-000002_ste-20231231.htm:40]**  | 250.9  **[0001757898-24-000005_ste03312024ex991do.htm:1]** **[0001757898-24-000005_ste03312024ex991do.htm:17]**  | 249.8  **[0001757898-24-000014_ste6302024ex991.htm:12]**  | 256.7  **[0001757898-24-000017_ste9302024ex991.htm:0]**  |
| **Life Sciences**            | 121.3  **[0001757898-23-000001_ste12312022ex991.htm:1]** **[0001757898-23-000002_ste-20221231.htm:31]** **[0001757898-23-000001_ste12312022ex991.htm:16]**  | 157.5  **[0001757898-23-000004_ste03312023ex991.htm:1]** **[0001757898-23-000004_ste03312023ex991.htm:12]**  | 131.4  **[0001757898-23-000010_ste-20230630.htm:32]**  | 133.1  **[0001757898-23-000012_ste9302023ex991.htm:1]**  | 146.6  **[0001757898-24-000001_ste12312023ex991.htm:1]** **[0001757898-24-000002_ste-20231231.htm:40]**  | 160.6  **[0001757898-24-000005_ste03312024ex991do.htm:1]**  | 128.5  **[0001757898-24-000014_ste6302024ex991.htm:12]**  | 127.9  **[0001757898-24-000017_ste9302024ex991.htm:0]**  |
| **Dental**                   | 103.6  **[0001757898-23-000001_ste12312022ex991.htm:1]** **[0001757898-23-000002_ste-20221231.htm:31]** **[0001757898-23-000001_ste12312022ex991.htm:16]**  | 103.6  **[0001757898-23-000004_ste03312023ex991.htm:1]** **[0001757898-23-000004_ste03312023ex991.htm:12]**  | 101.2  **[0001757898-23-000010_ste-20230630.htm:32]**  | 104.2  **[0001757898-23-000012_ste9302023ex991.htm:1]**  | 97.9  **[0001757898-24-000001_ste12312023ex991.htm:1]** **[0001757898-24-000002_ste-20231231.htm:40]**  | N/A | N/A | N/A |

05ae2f72daeb4c8f02a04fa42835e3e278b30c237cc32cdde0dde4eb51e416ff

Backlog in Healthcare segment (millions of USD)

Backlog in Life Sciences segment (millions of USD)

70da448854c15a25667d9f2547dfc732ea0f0f02f9b5ccebd6b1a2965d2014b8

| Metric [Unit: USD Million] | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 |
|----------------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| United States Revenues     | **883.4**  **[0001757898-23-000001_ste12312022ex991.htm:16]** **[0001757898-23-000002_ste-20221231.htm:33]**  | **997.0**  **[0001757898-23-000004_ste03312023ex991.htm:12]**  | **930.5**  **[0001757898-23-000008_ste6302023ex9911.htm:13]**  | **992.9**  **[0001757898-23-000012_ste9302023ex991.htm:15]** **[0001757898-23-000013_ste-20230930.htm:33]**  | **1,025.5**  **[0001757898-24-000001_ste12312023ex991.htm:12]**  | **1,036.0**  **[0001757898-24-000005_ste03312024ex991do.htm:17]**  | **946.9**  **[0001757898-24-000014_ste6302024ex991.htm:12]** **[0001757898-24-000016_ste-20240630.htm:21]**  | **979.5**  **[0001757898-24-000017_ste9302024ex991.htm:14]** **[0001757898-24-000018_ste-20240930.htm:24]**  |
| International Revenues     | **314.6**  **[0001757898-23-000001_ste12312022ex991.htm:16]** **[0001757898-23-000002_ste-20221231.htm:33]**  | **366.5**  **[0001757898-23-000004_ste03312023ex991.htm:12]**  | **333.9**  **[0001757898-23-000008_ste6302023ex9911.htm:13]**  | **329.0**  **[0001757898-23-000012_ste9302023ex991.htm:15]** **[0001757898-23-000013_ste-20230930.htm:33]**  | **350.5**  **[0001757898-24-000001_ste12312023ex991.htm:12]**  | **360.7**  **[0001757898-24-000005_ste03312024ex991do.htm:17]**  | **310.4**  **[0001757898-24-000014_ste6302024ex991.htm:12]** **[0001757898-24-000016_ste-20240630.htm:21]**  | **326.6**  **[0001757898-24-000017_ste9302024ex991.htm:14]** **[0001757898-24-000018_ste-20240930.htm:24]**  |
| Ireland Revenues           | **18.0**  **[0001757898-23-000001_ste12312022ex991.htm:16]** **[0001757898-23-000002_ste-20221231.htm:33]**   | **21.3**  **[0001757898-23-000004_ste03312023ex991.htm:12]**   | **20.1**  **[0001757898-23-000008_ste6302023ex9911.htm:13]**   | **20.4**  **[0001757898-23-000012_ste9302023ex991.htm:15]** **[0001757898-23-000013_ste-20230930.htm:33]**   | **19.7**  **[0001757898-24-000001_ste12312023ex991.htm:12]**   | **22.7**  **[0001757898-24-000005_ste03312024ex991do.htm:17]**   | **22.2**  **[0001757898-24-000014_ste6302024ex991.htm:12]** **[0001757898-24-000016_ste-20240630.htm:21]**   | **22.8**  **[0001757898-24-000017_ste9302024ex991.htm:14]** **[0001757898-24-000018_ste-20240930.htm:24]**  |

0d65bd7baf73d27a3bcd90808b3d4685a58e5d71e89285704180601139f65e24

STERIS is a leading global provider of products and services focused on infection prevention, supporting patient care through innovative healthcare and life science solutions. The company operates in three main business segments: Healthcare, Applied Sterilization Technologies (AST), and Life Sciences **[0001757898-24-000008_ste-20240331.htm:49]** **[0001757898-24-000008_ste-20240331.htm:3]** **[0001757898-24-000008_ste-20240331.htm:98]**. STERIS offers a comprehensive range of products and services, including infection prevention consumables, capital equipment like sterilizers and surgical tables, and services such as equipment maintenance and instrument repair **[0001757898-24-000008_ste-20240331.htm:4]** **[0001757898-24-000018_ste-20240930.htm:44]**. The company has divested its Dental segment to focus on core markets in healthcare, pharma, and MedTech **[0001193125-24-092481_d752903dex991.htm:0]**.

1. **Healthcare** - Offers a comprehensive range of products and services for healthcare providers, including infection prevention consumables, capital equipment like sterilizers and surgical tables, and services such as equipment maintenance and instrument repair **[0001757898-24-000008_ste-20240331.htm:4]** **[0001757898-24-000018_ste-20240930.htm:44]**.
2. **Applied Sterilization Technologies (AST)** - Provides contract sterilization and laboratory testing services for medical device and pharmaceutical manufacturers, offering a technology-neutral approach from testing through sterilization **[0001757898-24-000008_ste-20240331.htm:5]**.
3. **Life Sciences** - Supports biopharmaceutical and medical device research and manufacturing facilities with products like pharmaceutical detergents, sterilizers, and maintenance services **[0001757898-24-000008_ste-20240331.htm:5]**.

6c0b5d6c3f74a9f926003974a2ea2ce40a4ecda44256ed2c31a670b993d3ed8e

Adjustments for Non-Cash Items [USD, Thousands]

Stock-Based Compensation [USD, Thousands]

Changes in Working Capital [USD, Thousands]

Capital Expenditures (CapEx) [USD, Thousands]

Proceeds from / Repayments of Debt [USD, Thousands]

Share Repurchases [USD, Thousands]

Dividend Payments [USD, Thousands]

Net Change in Cash [USD, Thousands]

124fd2b81dd8ab8ffdfef481a2498c38363522fc68eef3bd0344090bccafdbf6

fbca07b1af4ec0bca464c3bf6427f08425b521b691b1e60b0170913ad0f83634

1. With the AST segment no longer expected to exit the year at double-digit revenue growth and margins impacted by labor and energy costs, what specific strategies are you implementing to improve AST's growth trajectory and profitability in the face of these challenges?
2. Given the anticipated flat to slightly down Healthcare capital equipment revenue for fiscal 2025 due to timing of shipments and difficult fourth quarter comparisons, how confident are you that recurring revenue outperformance can fully offset this decline, and what steps are you taking to drive capital equipment growth?
3. The Life Sciences segment is now expected to have flat revenue for the year, with declines in capital equipment sales partially mitigated by consumables. What are the underlying factors contributing to the decline in Life Sciences capital equipment, and how do you plan to address this weakness?
4. Labor and energy costs continue to pressure margins, particularly in AST, and you mentioned the inability to immediately pass on increased energy costs to customers. How are you planning to manage these costs, and when do you anticipate seeing margin improvement as a result?
5. You reported a one-time loss on a capital equipment order in your med-x business unit that negatively impacted AST margins. Can you provide more details on what led to this loss and what measures you're putting in place to prevent similar issues in the future?

f58012920150f5d686cdf76c96560edcf69526e95e3dfdfc86e1f139d71caae1

5e32fdd23fd89748a4567c458b0271723e0fa5167ce47821b9b24763483f559d

Ireland

United States

Other Foreign Locations

Total Revenue

ce4a305f970c19ab1987c1d875473acd7a384ee1a5f3b0885b159fd02b0b09c2

Healthcare

- Capital Equipment

- Consumables

- Service

Life Sciences

Dental

Product Revenue

Service Revenue

d0406fbbf1218174532253a1b1ae6de69057340a4d67d8bda50424bb7df372b2

Total Revenue [USD, Thousands]

Cost of Goods Sold (COGS) [USD, Thousands]

SG&A [USD, Thousands]

R&D [USD, Thousands]

D&A [USD, Thousands]

Interest Expense [USD, Thousands]

Operating Income (EBIT) [USD, Thousands]

Net Income [USD, Thousands]

EPS - Basic [USD]

EPS - Diluted [USD]

aae0a0557148edd9536676773278f0264054f16d0643cb2f350252d2f0f9975d

- 3M: Competitor in product offerings.
- Baxter: Competitor in product offerings.
- Boston Scientific: Competitor in product offerings.
- Belimed: Competitor in product offerings.
- Fortive: Competitor in product offerings.
- Getinge: Competitor in product offerings.
- Karl Storz: Competitor in product offerings.
- Olympus: Competitor in product offerings and service lines.
- Ruhof: Competitor in product offerings.
- SteelCo: Competitor in product offerings.
- Stryker: Competitor in product offerings.
- Skytron: Competitor in product offerings.
- Wassenburg: Competitor in product offerings.
- Agiliti: Competitor in service lines.
- BBraun: Competitor in service lines.
- Crothall: Competitor in service lines.
- Pentax: Competitor in service lines.  **[0001757898-24-000008_ste-20240331.htm:4]** 

af5c01d5ff789f06834c77356f1bd96bd283d9c13ae7b7f51a7af49a78741406

### Q2 2025 Earnings Call
- **Issued Period**: Q2 2025
- **Guided Period**: FY 2025
- **Guidance**:
  1. **Constant Currency Organic Revenue Growth**: 6% to 7%  **[STE_3406518_2]** .
  2. **Adjusted Earnings per Diluted Share**: $9.05 to $9.25  **[STE_3406518_2]** .
  3. **Free Cash Flow**: Approximately $700 million  **[STE_3406518_2]** .
  4. **Capital Spending**: About $360 million  **[STE_3406518_2]** .
  5. **Healthcare Segment Revenue Growth**: Mid- to high single digits  **[STE_3406518_2]** .
  6. **Life Sciences Revenue**: About flat  **[STE_3406518_2]** .
  7. **AST Segment Revenue Growth**: High single-digit  **[STE_3406518_2]** .
  8. **Interest Expense**: About $90 million  **[STE_3406518_19]** .
  9. **Profit Margins**: About flat  **[STE_3406518_2]** .

### Q1 2025 Earnings Call
- **Issued Period**: Q1 2025
- **Guided Period**: FY 2025
- **Guidance**:
  1. **Constant Currency Organic Revenue Growth**: 6% to 7%  **[STE_3397300_2]** .
  2. **Adjusted Earnings per Diluted Share**: $9.05 to $9.25  **[STE_3397300_2]** .
  3. **Free Cash Flow**: About $700 million  **[STE_3397300_2]** .
  4. **Capital Spending**: Approximately $360 million  **[STE_3397300_2]** .
  5. **Healthcare Capital Equipment Revenue Growth**: Low single-digit  **[STE_3397300_2]** .
  6. **Full Year Tax Rate**: 23%  **[STE_3397300_13]** .
  7. **Interest and Other Expenses**: About $100 million  **[STE_3397300_16]** .

### Q4 2024 Earnings Call
- **Issued Period**: Q4 2024
- **Guided Period**: FY 2025
- **Guidance**:
  1. **Revenue Growth**: 6.5% to 7.5% as reported; 6% to 7% constant currency organic  **[STE_3388209_2]** .
  2. **AST Segment Growth**: High single digits  **[STE_3388209_2]** .
  3. **Healthcare Growth**: Mid-single digits  **[STE_3388209_2]** .
  4. **Life Sciences Growth**: Low single digits  **[STE_3388209_2]** .
  5. **Adjusted EPS**: $9.05 to $9.25, increasing 10% to 13%  **[STE_3388209_2]** .
  6. **Earnings Split**: 45% in the first half, 55% in the second half  **[STE_3388209_2]** .
  7. **Pricing**: 200 basis points favorable  **[STE_3388209_8]** .
  8. **EBIT Margins**: Expected to improve  **[STE_3388209_2]** .

### Q3 2024 Earnings Call
- **Issued Period**: Q3 2024
- **Guided Period**: FY 2024
- **Guidance**: Specific metrics for this period are not detailed in the documents provided  **[STE_3372649_3]** .

4e29d41a75f9036d19a62191814bb1154844b46df4f8ceb54b8ac3d7c1fcd84a

| Name               | Position                                                      | Start Date       | Short Bio                                                                                                                                                                                                 |
|--------------------|---------------------------------------------------------------|------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Karen L. Burton    | Vice President and Chief Accounting Officer                   | January 2017     | Karen L. Burton serves as the **Vice President and Chief Accounting Officer** at STERIS plc. She assumed this role in **January 2017**. Prior to her current position, she also served as Controller from January 2017 until December 2023  **[0001757898-24-000008_ste-20240331.htm:19]** . |
| Daniel A. Carestio | President and CEO                                             | July 2021        | Daniel A. Carestio has served as the **President and CEO of STERIS plc** since **July 2021**. He was previously the Senior Vice President and Chief Operating Officer from August 2018 to July 2021  **[0001757898-24-000008_ste-20240331.htm:19]** **[0001193125-24-159955_d736605ddef14a.htm:21]** **[0001193125-23-162577_d413628ddef14a.htm:21]** .                                    |
| Mary Clare Fraser  | Senior Vice President and Chief Human Resources Officer       | May 2022         | Mary Clare Fraser serves as the **Senior Vice President and Chief Human Resources Officer** at STERIS. She assumed this role in **May 2022**. She joined STERIS in July 2020 as the Vice President and Chief Human Resources Officer  **[0001757898-24-000008_ste-20240331.htm:19]** .       |
| Kenneth E. Kohler  | Senior Vice President and General Manager, AST                | February 2024    | Kenneth E. Kohler serves as **Senior Vice President and General Manager, AST** at STERIS. He assumed this role in **February 2024**. Previously, he was Vice President and General Manager of AST Americas from November 2015 to February 2024  **[0001757898-24-000008_ste-20240331.htm:19]** . |
| Julia K. Madsen    | Senior Vice President and General Manager, Life Sciences      | July 2020        | Julia K. Madsen serves as **Senior Vice President and General Manager, Life Sciences** at STERIS. She assumed this role in **July 2020**. Previously, she was Vice President and General Manager of Life Sciences, Consumables  **[0001757898-24-000008_ste-20240331.htm:19]** .               |
| Cary L. Majors     | Senior Vice President and President, Healthcare               | August 2022      | Cary L. Majors serves as the **Senior Vice President and President, Healthcare** at STERIS. He assumed this role in **August 2022**. Previously, he was Senior Vice President, Americas Commercial Operations from August 2019 to August 2022  **[0001757898-24-000008_ste-20240331.htm:19]** .|
| Renato G. Tamaro   | Vice President and Corporate Treasurer                        | August 2017      | Renato G. Tamaro serves as Vice President and Corporate Treasurer at STERIS. He assumed this role in **August 2017**. Previously, he served as Assistant Treasurer from March 2006 to July 2017  **[0001757898-24-000008_ste-20240331.htm:19]** .                                            |
| Michael J. Tokich  | Senior Vice President and Chief Financial Officer             | August 2017      | Michael J. Tokich serves as the **Senior Vice President and Chief Financial Officer** at STERIS plc. He assumed this role in **August 2017**. Previously, he was Senior Vice President, Chief Financial Officer, and Treasurer  **[0001757898-24-000008_ste-20240331.htm:19]** **[0001757898-23-000005_ste-20230331.htm:20]** .           |
| Andrew Xilas       | Senior Vice President and General Manager, Dental             | June 2021        | Andrew Xilas serves as **Senior Vice President and General Manager, Dental** at STERIS. He assumed this role in **June 2021**. He joined HuFriedy Group in 1987, where he held roles of increasing responsibility  **[0001757898-24-000008_ste-20240331.htm:19]** .                           |
| J. Adam Zangerle   | Senior Vice President, General Counsel, and Company Secretary | July 2018        | J. Adam Zangerle serves as **Senior Vice President, General Counsel, and Company Secretary** at STERIS plc. He assumed this role in **July 2018**. Previously, he was Vice President, General Counsel, and Secretary  **[0001757898-24-000008_ste-20240331.htm:19]** **[0001757898-23-000005_ste-20230331.htm:20]** .                      |

2023c5d7ed18750bde920cd86c005145005a3026d1d66796e75434d009eecfc7

| Program Details          | Program 1       |
|--------------------------|-----------------|
| Approval Date            | **May 3, 2023**  **[0001757898-24-000018_ste-20240930.htm:25]** **[0001757898-24-000018_ste-20240930.htm:63]**  |
| End Date/Duration        | **No specified expiration date**  **[0001757898-24-000018_ste-20240930.htm:25]** **[0001757898-24-000018_ste-20240930.htm:63]**  |
| Total additional amount  | **$500 million**  **[0001757898-24-000018_ste-20240930.htm:25]** **[0001757898-24-000018_ste-20240930.htm:63]**  |
| Remaining authorization amount | **$400 million** (as of September 30, 2024)  **[0001757898-24-000018_ste-20240930.htm:25]** **[0001757898-24-000018_ste-20240930.htm:63]**  |
| Details                  | The program allows for share repurchases through open market purchases, including 10b5-1 plans, and can be activated, suspended, or discontinued at any time.  **[0001757898-23-000010_ste-20230630.htm:16]** **[0001757898-24-000016_ste-20240630.htm:22]** **[0001757898-23-000005_ste-20230331.htm:142]** **[0001757898-24-000008_ste-20240331.htm:145]** **[0001757898-24-000016_ste-20240630.htm:56]** **[0001757898-24-000018_ste-20240930.htm:63]** **[0001757898-24-000002_ste-20231231.htm:58]** **[0001757898-23-000013_ste-20230930.htm:57]**  |

38a1d6f9a82f5bf38c7c947680a66331db895a22da21f305e97baa2ad8d3b124

**Annual guidance for FY 2025:**
- **Constant Currency Organic Revenue Growth**: 6% to 7%  **[STE_3406518_2]**  (no change from 6% to 7%  **[STE_3397300_2]** )  
- **Adjusted Earnings per Diluted Share**: $9.05 to $9.25  **[STE_3406518_2]**  (no change from $9.05 to $9.25  **[STE_3397300_2]** )  
- **Free Cash Flow**: Approximately $700 million  **[STE_3406518_2]**  (no change from About $700 million  **[STE_3397300_2]** )  
- **Capital Spending**: About $360 million  **[STE_3406518_2]**  (no change from Approximately $360 million  **[STE_3397300_2]** )  
- **Healthcare Segment Revenue Growth**: Mid- to high single digits  **[STE_3406518_2]**  (no prior guidance)  
- **Life Sciences Revenue**: About flat  **[STE_3406518_2]**  (no prior guidance)  
- **AST Segment Revenue Growth**: High single-digit  **[STE_3406518_2]**  (no prior guidance)  
- **Interest Expense**: About $90 million  **[STE_3406518_19]**  (no prior guidance)  
- **Profit Margins**: About flat  **[STE_3406518_2]**  (no prior guidance)  

5e9e4dab1d7ea7e7419a66f1a3800447642284e441557b4ba712bbe7cb807332

| Name              | Start Date | End Date | Reason for Change |
|-------------------|------------|----------|-------------------|
| Ernst & Young LLP | 1989  **[0001757898-24-000008_ste-20240331.htm:92]**   | Present  | Current auditor   |

ed6976c0db4668002ed907263e1b591b7691d7e73bf8527bb50573b2cb22954a

e21b95dc57f18b7c37426366587f1a57dac2a501ee97667a3c3d2adb7b1e3e3a

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

| Year | Amount Due (Millions) | Debt Type                  | Interest Rate (%) | % of Total Debt                                                                 |
|----------|---------------------------|--------------------------------|-----------------------|------------------------------------------------------------------------------------|
| 2024     | 80.0                      | Private Placement Senior Notes | N/A                   | 3.6% = (80.0 / 2,236.158) * 100 **[0001757898-24-000018_ste-20240930.htm:18]**                                           |
| 2029     | 141.396                   | Revolving Credit Facility      | N/A                   | 6.3% = (141.396 / 2,236.158) * 100 **[0001757898-24-000018_ste-20240930.htm:18]**                                        |
| 2031     | N/A                       | 2.700% Senior Notes            | 2.700                | N/A **[0001757898-24-000018_ste-20240930.htm:0]**                                                                      |
| 2051     | N/A                       | 3.750% Senior Notes            | 3.750                | N/A **[0001757898-24-000018_ste-20240930.htm:0]**                                                                      |
| N/A      | 680.794                   | Private Placement Senior Notes | N/A                   | 30.4% = (680.794 / 2,236.158) * 100 **[0001757898-24-000018_ste-20240930.htm:18]**                                       |
| N/A      | 1,350.0                   | Senior Public Notes            | N/A                   | 60.4% = (1,350.0 / 2,236.158) * 100 **[0001757898-24-000018_ste-20240930.htm:18]**                                       |

988a84e1766d839ebef0e777e6d4306ce28d0ed2f6a22480474ea693cb11ea3b

6b90e63efafeeec29354cc169b84de3812b79a931aac6dabcab5fadd0fe3835e

1. **Revenue Pacing and Earnings Growth**  
   **Q:** Is first-half growth below the full-year guide?  
   **A:** Management expects the first half of fiscal '25 to be a bit lighter in revenue and margin due to tough comparisons, with growth ramping up in the second half. While they don't provide a revenue split, they indicate earnings will be more weighted towards the second half.  **[STE_3388209_10]** **[STE_3388209_12]** 

2. **Healthcare Equipment Revenue Expectations**  
   **Q:** Why won't healthcare equipment revenue moderate if backlog is normal?  
   **A:** Despite normalizing lead times and backlog levels, demand remains high, and annual order intake is significantly higher than four years ago. While they don't expect to grow at the same double-digit pace as last year, they anticipate **low single-digit growth** in healthcare capital equipment revenue.  **[STE_3388209_4]** **[STE_3388209_13]** 

3. **AST Growth and European Recovery**  
   **Q:** Where do we stand on the inventory overhang in Europe?  
   **A:** The U.S. market has recovered, with medical devices growing at **double digits** in the second half. Europe's recovery is slower, possibly due to procedural rates, but management is confident that in the second half of the year, there will be a robust turnaround in Europe.  **[STE_3388209_6]** 

4. **Pricing Assumptions for Fiscal '25**  
   **Q:** How much pricing is assumed in fiscal '25 guidance?  
   **A:** For fiscal '24, the total consolidated favorable price impact was **270 basis points**. In fiscal '25 guidance, they are assuming around **200 basis points** of favorable price.  **[STE_3388209_8]** 

5. **M&A Plans After Divestiture**  
   **Q:** Should we expect near-term deals after the dental divestiture?  
   **A:** The company has the capacity—both financially and operationally—for acquisitions but will pursue opportunities as they arise. They are experienced in acquisitions and integration, emphasizing that such opportunities must present themselves.  **[STE_3388209_9]** 

6. **Gamma Radiation Capacity and X-ray Expansion**  
   **Q:** Thoughts on gamma supply vs. demand as bioprocessing returns?  
   **A:** The company is expanding x-ray capacity to address gaps in gamma radiation supply due to isotope shortages. New sites are coming online over the next two years, positioning them well to meet increasing demand for radiation processing.  **[STE_3388209_11]** 

7. **Impact of Life Sciences Divestiture on EPS**  
   **Q:** Any impact on margins or EPS from the Life Sciences divestiture?  
   **A:** The divestiture was small, causing minimal negative impact on Life Sciences growth rates and no impact on the bottom line. No financing considerations are necessary.  **[STE_3388209_7]** 

8. **Competitive Environment and In-sourcing**  
   **Q:** How is the industry changing amid sterilization regulations?  
   **A:** STERIS is well-positioned as a technology-neutral and location-neutral company, supporting customers whether they in-source or outsource sterilization. They've expanded capacity and are working with regulatory agencies to lower barriers for alternative methods.  **[STE_3388209_5]** 

75c98fca28c521767eafc2a04ac750044517d3609281b7ab4dffebacf9b501e2

- **Healthcare equipment revenue growth is expected to slow from double-digit to low single-digit rates due to normalization of backlog and tougher comparisons.**  **[STE_3388209_14]** **[STE_3388209_13]** **[STE_3388209_4]**
- **Pricing benefits are projected to decrease in fiscal '25, with pricing contribution reducing from 270 basis points in fiscal '24 to an anticipated 200 basis points.**  **[STE_3388209_8]**
- **First half of fiscal '25 is expected to have lighter revenue and margins due to tough comparisons, indicating potential uneven growth during the year.**  **[STE_3388209_10]** **[STE_3388209_12]**

94d48dcc81796004cb3a98b0cea65f5f919398565482c978a4f5020434601175

1. **Healthcare Capital Equipment Guidance**  
   **Q:** How confident are you in achieving low single-digit growth?  
   **A:** Management acknowledged that the model had been disrupted over the past 18 months, but they are confident in achieving **low single-digit growth** in Healthcare capital equipment. By returning to normal lead times and focusing on turn business, they believe they can meet their guidance.  **[STE_3397300_8]** **[STE_3397300_12]** 

2. **Operating Margin Outlook**  
   **Q:** Can you explain the margin decline and expectations?  
   **A:** Operating margins were down **20 basis points** year-over-year due to increased compensation and higher insurance costs.  **[STE_3397300_5]**  However, EBIT dollars increased by **$20 million**, and management remains confident in driving positive EBIT margin leverage for the full year.  **[STE_3397300_5]** 

3. **Life Sciences Business Outlook**  
   **Q:** What's the outlook for Life Sciences amid capital slowdown?  
   **A:** There has been a slowdown in demand for capital products due to decreased funding in pharma and biopharma.  **[STE_3397300_7]**  However, strong growth in services and consumables, particularly in injectables, is offsetting these headwinds.  **[STE_3397300_7]** **[STE_3397300_10]** 

4. **Labor Inflation Impact**  
   **Q:** How is labor inflation affecting costs?  
   **A:** Compensation increases implemented over the past 6-12 months are now impacting costs.  **[STE_3397300_6]**  Management does not expect significant further increases and notes that turnover has decreased, indicating improved control over labor expenses.  **[STE_3397300_6]** 

5. **Restructuring Plan Details**  
   **Q:** Can you provide an update on the restructuring plan?  
   **A:** The company announced a **$100 million** restructuring plan involving the closure of a manufacturing facility.  **[STE_3397300_15]**  A **$25 million** benefit is expected this year, with the majority of benefits realized in fiscal year 2026.  **[STE_3397300_15]** 

6. **AST Capacity Expansions**  
   **Q:** Will capacity expansions drive AST growth?  
   **A:** Capacity expansions are part of normal operations and a long-term strategy to support growth.  **[STE_3397300_9]**  They facilitate continued demand but are not expected to significantly boost growth in the near term.  **[STE_3397300_9]** 

7. **Supply Chain Initiatives**  
   **Q:** How are supply chain initiatives progressing?  
   **A:** The shift to larger suppliers is a long-term effort focused on ensuring supply reliability.  **[STE_3397300_11]**  While margin improvements are a goal, the primary focus is on securing consistent supply.  **[STE_3397300_11]** 

8. **Capital Deployment Priorities**  
   **Q:** Any change in M&A or capital priorities?  
   **A:** Investment priorities remain unchanged.  **[STE_3397300_16]**  The company is well-positioned financially and will act on opportunities as they present themselves.  **[STE_3397300_16]** 

9. **Interest Expense and Tax Rate**  
   **Q:** What is the outlook for interest expense and tax rate?  
   **A:** Favorable discrete items lowered the tax rate to **21%** in Q1, but the full-year rate is expected to be **23%**.  **[STE_3397300_13]**  Interest expense benefited from the faster use of proceeds from the dental sale, with full-year interest projected at **$100 million**.  **[STE_3397300_13]**  

10. **BD Acquisition Integration**  
    **Q:** How is the BD acquisition being integrated?  
    **A:** The BD acquisition is classified primarily under consumables in the Healthcare segment, with **90%** in consumables and **10%** in capital equipment.  **[STE_3397300_14]**  It has a similar margin profile to the core business.  **[STE_3397300_14]** 

78f32d1f0ac9246ea99daf27c20ac35469cf53c8738c1f59daad2a78107983fa

- **Strong performance in the Healthcare segment's consumables and services**, driven by rising procedure volumes, price increases, and **market share gains**, with **recurring revenue expected to grow above procedure volumes** and relatively independent of capital equipment shipments.  **[STE_3397300_4]**
- **Growth opportunities in the Life Sciences segment**, particularly in **injectable drug manufacturing**, where STERIS's aseptic manufacturing solutions are in demand, driving **strong growth in consumables and services** despite a slowdown in capital equipment.  **[STE_3397300_7]** **[STE_3397300_10]**
- **Operational efficiencies in manufacturing and supply chain have improved**, returning to normal lead times and enabling STERIS to sell more **"on the turn" business**, increasing confidence in meeting capital equipment guidance despite a lower backlog.  **[STE_3397300_8]** **[STE_3397300_12]**

082c396089dab7184efc8dda0886f0cebcbb0916b44636898e3ee73a080597d5

- **Decreased EBIT margins due to a mix shift from the higher-margin AST segment to the Healthcare segment**, with this trend expected to continue impacting profitability.  **[STE_3372649_1]** **[STE_3372649_13]** **[STE_3372649_8]**
- **AST segment experiencing reduced volumes as customers burn down inventory by up to 40%**, particularly in Europe, leading to lower revenues and margin pressure.  **[STE_3372649_12]** **[STE_3372649_8]**
- **Price increases may not be sustainable as costs normalize**, which could limit future revenue growth and margin expansion.  **[STE_3372649_17]**

33c6b87a3bec95685693ef06331db30556c987ae0edbe30290e94718b6d1961d

- **Strong growth in consumables and services within the Healthcare segment**, driven by increased procedure volumes, pricing, and market share gains, especially in sterile processing consumables where large contracts have been secured.  **[STE_3406518_9]**
- **Optimistic outlook for bioprocessing revenue growth** in the second half of the fiscal year, expected to be accretive to growth in the Applied Sterilization Technologies segment.  **[STE_3406518_4]**
- **Benefiting from reshoring and front-shoring trends with significant growth in Asia-Pacific**, particularly Malaysia, positioning the company well for future growth opportunities due to customers relocating operations in anticipation of potential challenges related to China.  **[STE_3406518_7]**

30457959365c84fe2d96c861a7e26ed83c1c1d737d3b550087e978c21318f166

- **Slowdown in demand for capital products in the Life Sciences segment** due to decreased funding and cutbacks in pharma and biopharma over the last **6-9 months**, which may negatively impact revenues.  **[STE_3397300_7]**
- **Operating margins decreased 20 basis points** year over year due to increased compensation and higher insurance costs, and the company is **"not getting the leverage that we anticipate"**. Margins may remain under pressure.  **[STE_3397300_5]**
- Analysts express skepticism about the company's **Healthcare capital equipment revenue growth guidance of low single-digit growth**, given lower backlog and challenging comparisons, suggesting potential over-optimism in forecasts.  **[STE_3397300_8]**

0f6e6e760a3a9bc167026b23849e25109059cddf845b0d05bf76db1b3cafe48c

- **Labor and energy costs are pressuring margins**, with increasing labor costs being a lagging issue and **energy costs out of the company's control**. There is a **lag in passing these costs onto customers**, potentially impacting near-term profitability.  **[STE_3406518_11]**
- The **AST segment's outlook has been adjusted to be more conservative** due to lower than expected volumes year-to-date, indicating potential slowing growth in this segment. This adjustment is based on the **current run rate and trends** observed.  **[STE_3406518_17]**
- The strong growth in **Life Sciences consumables is against easy comparisons from last year** due to destocking, suggesting that current strong demand may not be sustained and future growth rates might be lower as comparisons become tougher.  **[STE_3406518_20]**

798d3a485d1882bb2725af17434a8e2a9f809e97502b9291365f909d83701b5f

- **Strong Performance and Growth in the Healthcare Segment:** STERIS reported double-digit growth across capital equipment, consumables, and service in their Healthcare segment, driven by procedure volume rebound in the U.S., price increases, and market share gains.  **[STE_3372649_4]**  Capital equipment orders in the Healthcare segment grew **double digits** in the quarter  **[STE_3372649_4]** , and the company sees this strength as sustainable due to continued high delivery rates and contributions from recent acquisitions.  **[STE_3372649_13]**  **Healthcare segment margins hit a new high this quarter**.  **[STE_3372649_13]**
- **Improved Free Cash Flow and Debt Reduction Enhancing Financial Position:** Free cash flow for the first nine months of fiscal 2024 was **$457 million**, up from $262.8 million in the prior year period, driven by higher earnings and reduced expenditures.  **[STE_3372649_1]**  Debt declined to **$3.3 billion**, with a total debt-to-EBITDA ratio of approximately **2.2x** at quarter end  **[STE_3372649_1]** **[STE_3372649_16]** . STERIS is focusing on paying down debt, enhancing financial flexibility in a higher interest rate environment.  **[STE_3372649_16]**
- **Positive Long-Term Outlook for AST Segment with New Capacity Coming Online:** While the AST segment faced short-term challenges due to customer destocking and lower bioprocessing volumes, the company expects volumes to recover as destocking abates.  **[STE_3372649_5]**  STERIS is expanding its capacity by bringing new X-ray sterilization facilities online in the U.S. and internationally, with two U.S. sites coming online this calendar year.  **[STE_3372649_7]**  These expansions position the AST segment for future growth as bioprocessing demand returns to historical levels.  **[STE_3372649_5]**

ec74f13e493d94e218a1b69266e8d5c3debda03667518e83a49b19fa9fccbf3b

1. **AST Margins and Outlook**  
   **Q:** Can AST margins return to prior high levels?  
   **A:** Management stated there are no structural impediments to AST margins returning to the upper **40%** levels seen in fiscal '22 and early '23. The key driver is volume; as a high fixed-cost business, increased volumes will enhance margins.  **[STE_3372649_13]** **[STE_3372649_14]** 

2. **Margin Dynamics and Incentive Compensation**  
   **Q:** What affected margins this quarter and outlook?  
   **A:** Margins were impacted by a **$40 million** incentive compensation headwind, with **$22 million** affecting the third quarter. However, pricing gains have begun to offset labor inflation, and productivity improved significantly from negative **150-200 basis points** last quarter to flat this quarter.  **[STE_3372649_6]** 

3. **Healthcare Capital Equipment Outlook**  
   **Q:** Will Healthcare capital revenue grow in fiscal '25?  
   **A:** Management is optimistic about continued growth in Healthcare capital equipment revenue, citing strong shipments, double-digit orders growth in the third quarter, and reduced backlog levels leading to normalized lead times.  **[STE_3372649_4]** **[STE_3372649_20]** **[STE_3372649_21]** 

4. **AST Capacity Expansion**  
   **Q:** What is the progress on expanding AST capacity?  
   **A:** Two U.S. X-ray sterilization sites will come online this calendar year: Libertyville, Illinois, operational in the next few months, and Ontario, California, in the fall. Additional sites in Asia and Europe are expected to commence operations in the next **18 months**.  **[STE_3372649_7]** 

5. **Dental Segment Plans**  
   **Q:** Any updates on the future of the Dental segment?  
   **A:** While operations have normalized post the Henry Schein cybersecurity incident, management continues to review the Dental segment's position within the portfolio. No decisions have been made, but updates will be provided when available.  **[STE_3372649_15]** 

6. **Use of Cash and Share Repurchases**  
   **Q:** Will there be share repurchases or changes in capital allocation?  
   **A:** The company's capital allocation priorities remain unchanged. Excess cash is currently directed towards debt repayment due to higher interest rates, reducing gross leverage to **2.2x** even after the BD acquisition. They repurchased approximately **$225 million** of shares last fiscal year but have not purchased any in FY '24 to date.  **[STE_3372649_16]** 

7. **Pricing Trends and Inflation**  
   **Q:** Is the recent pricing strength sustainable?  
   **A:** Management believes the ability to implement price increases depends on cost justification. As costs normalize, there may be less opportunity for significant price increases.  **[STE_3372649_17]** 

8. **Life Sciences Segment Outlook**  
   **Q:** What is the outlook for the Life Sciences segment?  
   **A:** While recent performance benefited from easier comparisons, long-term demand remains strong due to growth in aseptic drugs, biologics, and cell and gene therapies. Short-term pressures persist due to destocking and challenges in big pharma, but the markets served are expected to be in high demand.  **[STE_3372649_9]** 

9. **European Inventory Impact on AST**  
   **Q:** How is European destocking affecting AST?  
   **A:** The European market has not yet seen inventory burn-down in medtech, unlike the U.S., where efficient healthcare systems and increased procedure volumes have accelerated destocking. Customers have indicated they are reducing inventory by up to **40%**, which impacts AST volumes in Europe.  **[STE_3372649_5]** **[STE_3372649_11]** **[STE_3372649_12]** 

10. **Radiation Sterilization Pilot Program**  
    **Q:** What is the status of the sterilization pilot program?  
    **A:** The program has been positively received by customers and regulators, including the FDA. It lowers regulatory barriers for customers switching sterilization modalities, offering more supply chain flexibility. While not expected to have a material short-term impact, it is seen as beneficial in the long term.  **[STE_3372649_19]** 

c017dbfbb2af591239119468785393f777a64a638da98e10c76a7085dcabf2a6

1. **AST Margins and Outlook**  
   **Q:** Why is AST not achieving double-digit growth?  
   **A:** AST's growth is at **6%**  **[STE_3406518_13]** , below expectations due to inventory management by medtech customers and mismatched procedure rates.  **[STE_3406518_13]**  Management doesn't expect to exit the year at double-digit growth but remains optimistic for future improvement  **[STE_3406518_4]** ,.  **[STE_3406518_6]** 

2. **Litigation Update**  
   **Q:** Any update on ongoing EO litigation?  
   **A:** Management declined to discuss legal strategy or details regarding the EO litigation related to the Waqigail-Illinois facility  **[STE_3406518_8]** , **[STE_3406518_15]** ,.  **[STE_3406518_16]**  They referred to the disclosures provided in the 10-Q  **[STE_3406518_8]** ,.  **[STE_3406518_15]** 

3. **Operating Margin Expectations**  
   **Q:** Why is operating margin expected to be flat?  
   **A:** Due to AST not performing as expected and not exiting at double-digit growth, they won't achieve EBIT margin improvement this year.  **[STE_3406518_6]**  However, they remain confident in achieving long-term EBIT margin expansion annually.  **[STE_3406518_6]** 

4. **M&A Pipeline and Capital Allocation**  
   **Q:** Can you comment on M&A opportunities and share repurchases?  
   **A:** Management cannot comment on the M&A pipeline but stated they have financial capacity for acquisitions.  **[STE_3406518_10]**  They mentioned buying back **$100 million** of shares in the first half of the fiscal year, reflected in the balance sheet and debt.  **[STE_3406518_10]** 

5. **Labor and Energy Costs**  
   **Q:** Are labor and energy costs still impacting margins?  
   **A:** Yes, labor costs are lagging and should anniversary during the fiscal year.  **[STE_3406518_11]**  Energy costs are out of their control and can't be passed on immediately, causing a lag.  **[STE_3406518_11]** 

6. **Bioprocessing Outlook**  
   **Q:** How significant is bioprocessing in AST revenue?  
   **A:** Bioprocessing is now about **6% to 8%** of AST revenue.  **[STE_3406518_12]**  It is projected to grow nicely from this new level.  **[STE_3406518_12]** 

7. **Pricing in AST**  
   **Q:** Any adjustments or moderation in AST pricing?  
   **A:** No pricing adjustments; the outlook change is due to year-to-date volumes and trends.  **[STE_3406518_17]** 

8. **Life Sciences Consumables Growth**  
   **Q:** What's driving strong consumable demand in Life Sciences?  
   **A:** Strong recovery from core customers back in full production after last year's destocking.  **[STE_3406518_20]**  Consumables business, particularly in barrier products and chemistry, is showing strong growth against easier comps.  **[STE_3406518_20]** 

9. **Healthcare Equipment Growth Expectations**  
   **Q:** Why is healthcare equipment growth now flat to slightly down?  
   **A:** Shipment delays due to weather-related issues like hurricanes impacted Q2 shipments.  **[STE_3406518_5]**  Backlog remains strong, and the impact is minor, offset by higher profit mix from consumables and services.  **[STE_3406518_5]** 

10. **MedTech Customer Trends**  
    **Q:** Is inventory management affecting AST growth?  
    **A:** Yes, medtech customers are tightly managing inventory, impacting AST growth.  **[STE_3406518_13]**  As procedure rates align with AST growth, better performance is expected.  **[STE_3406518_13]** 

11. **Interest Expense Impact**  
    **Q:** How are you maintaining EPS guidance despite flat margins?  
    **A:** Favorable impact on interest expense; now expecting about **$90 million** for the full year.  **[STE_3406518_19]** 

12. **Balance Sheet and Leverage**  
    **Q:** Any plans given the under-levered balance sheet?  
    **A:** Management has financial capacity for acquisitions and integration.  **[STE_3406518_10]**  The deal pipeline is robust, focusing on smaller tuck-in acquisitions.  **[STE_3406518_10]** 

f0440f3572ca76534ceeadf83b3cc4086e54275070693273dd61529af6784873

- *• Consistent strong performance in the Healthcare segment**, with **13% constant currency organic revenue growth in fiscal 2024**, marking the **third consecutive year of double-digit growth for this segment**.  **[STE_3388209_2]**  The company expects **mid-single-digit growth in Healthcare for fiscal 2025**  **[STE_3388209_2]** , driven by strong demand and a well-positioned product portfolio.  **[STE_3388209_13]**
- *• Anticipated acceleration in the AST segment**, with **high single-digit growth expected for fiscal 2025** and growth **accelerating in the second half** of the year.  **[STE_3388209_2]**  Stabilization in bioprocessing demand and a potential robust turnaround in the European market support this outlook.  **[STE_3388209_2]** **[STE_3388209_6]**
- *• Positive overall outlook for fiscal 2025**, with **reported revenue from continuing operations expected to increase 6.5% to 7.5%**, and **adjusted earnings per diluted share anticipated to increase 10% to 13% to a range of $9.05 to $9.25**.  **[STE_3388209_2]**  **EBIT margins are expected to improve** as some headwinds from fiscal 2024 abate.  **[STE_3388209_2]**

d6434353a6985c869c7d6239b4c918bf77e78249f00b93cd50e4966e2005713c

STERIS plc (STE)

Financials