Zimmer Biomet Holdings, Inc. (NYSE:ZBH) Q4 2022 Earnings Call Transcript

Rick Wise: Great. Two questions. I’ll just say them right up front. First, I don’t think you commented on China, Brian. It seems like the latest COVID surge is subsiding, we’re seeing mostly negative but sort of mixed results on doing a little better. How are you thinking about China, factoring it into the first quarter and to the full year? A quick one for Suke – Suke, Brian asked me to ask you about the shared services initiative. You’re in the early innings. He said, why isn’t it moving faster? Just kidding, Suke, just kidding.

Suketu Upadhyay: That’s a great question.

Bryan Hanson: Rick clearly knows me.

Suketu Upadhyay: Yes, so we’re seeing China and COVID surges clearly start to stabilize in the first quarter. It was pretty acute there in the fourth quarter. Fortunately, we were able to offset it with strength in other markets, so overall China wasn’t as big a factor in the fourth quarter and we don’t see it as a material mover, at least from a COVID standpoint, in the first quarter. We do see China as a very attractive market for overall growth in ’23 and beyond, especially now that we’ve moved through all of the pain and noise of BBP, which is now sunsetting behind us, so really feeling good about where that market is, and now that team can start to position towards not only growing the business but start to really work on the margin structure of China as a whole, coming out of BBP.

So again, feel very optimistic about where we are there. Yes, what a way to end a call on a good quarter and good outlook with shared services, but I love your ambition and I’m going to share that with the leadership team that we’ve got to move faster, so thanks for the question.

Keri Mattox: All right, thanks Rick, and thanks for all the questions. I’ll turn it over to Bryan just to close out the call.

Bryan Hanson: Just a couple thoughts. First of all, thanks for joining us this morning. I would say I hope it’s clear that the Phase 1 and Phase 2 of the transformation of this company are well on track and we’re feeling very good about where we stand. I can tell you because of those two phases, I feel that we’ll at least take our fair share of the markets that we play in, and certainly hope to do more than that. Now we’re moving onto Phase 3, and that really is the portfolio transformation of our company. We’re looking at changing the mix of our revenue to make sure that we have more of that mix in high growth markets, and we’re going to do that in three ways, which is kind of a combination of Phase 2/Phase 3. The first one is innovation – we’re going to invest in innovation in the right areas, in faster growth markets so that we build more revenue through that innovation in those attractive markets.