Joshua Jennings: Hi, good morning. Thanks for taking the questions and I echo the congratulations on the strong finish of the year. Was hoping to just follow-up on your comments there, Robert, on just the earnings power and just the margin expansion trajectory. Abbott is a unique story relative to peers because you didn’t have the margin headwinds during the pandemic due to the COVID testing business that you developed internally. But was hoping to just thinking about the pre-pandemic margin expansion trajectory of the business in that 30 to 50 basis point range. And, so just give us a little bit more color on some of the drivers of margin expansion and how your team sees that trajectory going forward in into the out years. Thanks for taking the question.
Robert Ford: Sure. I listen, we hear a lot of companies talk about working here to recover to their operating margin and try to get back to their op margin pre-pandemic. We’re in a pretty unique position, I’d say, versus our peers here. Our op margin profile is already at the pre-pandemic level. And I think what you saw us do there, Josh, and I talked a little bit about in my comments is I think we manage very well strategically the spending piece of it. We accelerated the spending investments when we were at our COVID sales were at their peak levels a few years ago. And then we held that spending flat these last couple of years, even though our top-line was growing pretty significantly here. So I’d say our biggest opportunity for margin expansion really is on the gross margin line.
And that is, I think about our big five activities this year, the Company, and we can do all five in the same time. But I’d say gross margin is pretty high up there in our priority. We’re forecasting a pretty nice step up in our gross margin profile this year, roughly around 75 basis points. And there’s a combination of factors that are helping to drive that margin expansion, that profile expansion. We’ve got a pretty strong track record here of executing on internal margin improvement programs. So every business has got their programs. We manage those on a monthly basis. They all get reported out. So there’s a high degree of visibility and inspection to those programs. Some of the headwinds that we faced, I’d say, over the last couple of years are starting to turn a little bit into tailwinds.
So whether it’s commodity costs, freight and distribution, all those elements seem to be, I’d say, right now, and given our visibility for the year as we stand here today, turning into tailwinds. So that helps. And then the other part here is just, I’d say, portfolio mix. So as some of the device businesses continue to outpace and continue to grow, those are higher margin businesses. And they provide that mix element in that gross margin expansion. So, I think this provides a nice opportunity for us this year. But I expect over time, we’ll get back to our pre-pandemic gross margin profile. For me, it’s not a question of if? It’s just a question of when? If we could target 50, 75, it’s never going to be as linear as we always would want. But that kind of expansion for us, I think, really provides a good opportunity to drive earnings growth over the next couple of years.
So I’d say that’s our biggest opportunity. I think we did a really good job at leveraging spending. And I think you see that in our profiles. So our big opportunity here is gross margin. And we’re all over it.
Operator: Thank you. And our next question will come from Marie Thibault from BTIG. Your line is open.
Marie Thibault: Good morning. Thank you for taking the questions. I wanted to ask a little bit more about your electrophysiology business. That segment has been very strong. And I’ve been impressed that you’ve been able to put up that European growth rate in the face of some competitive PFA launches. So we’d love to hear what’s going on behind the scenes there, how you’re getting those growth rates, and how you’re thinking about the US EP business as we see some PFA launches this year? Thanks for taking the questions.
Robert Ford: Sure. Well, I think we’ve showed pretty strong, robust growth in our EP business throughout all the year, even in the face of actual in-market competition. It’s been strong across the board. I don’t think it’s just been a Europe story. U.S. has been strong. China has been very strong for this year, especially in VBP. There were some price challenges throughout the year with VBP, but the volume we picked up, the market share we picked up, more than offset that. So it’s really been across the board here. And I think it really is about the strength of the portfolio. So not only having a strong mapping system with our InsighTX, I think it’s at the core, good mapping disposables and diagnostic disposables also. And I think launching TactiFlex, which is the flexible tip combined with the contact force.
