Orthofix Medical (OFIX) Canaccord Genuity's 46th Annual Growth Conference summary

Business performance and guidance

• EBITDA more than doubled in two years, with cash usage reduced to near breakeven last year.

• Updated guidance reflects reimbursement restoration, European MDR-related inventory purchase, and strength in biologics and limb reconstruction, offset by a steeper decline in smaller U.S. spine distributors.

• Q3 revenue and profitability expected to be similar to Q2, with EBITDA margin expansion versus prior year; majority of European MDR inventory purchase to occur in Q4.

• Procedural volumes remain consistent, with top 40 distributors growing above market.

• Organic volume-driven growth, not price, is the main driver; international margins generally lower than U.S.

Regulatory and reimbursement developments

• CMS bone growth stimulation reimbursement changes were reversed after a concerted industry effort, resulting in a $1 million impact in Q2, to be recouped in Q3.

• FDA down-classification remains, enabling more innovation and market expansion opportunities.

Segment strategies and operational changes

• Spine business is concentrating on larger, higher-quality distributors, reallocating resources from underperforming smaller distributors.

• No plans to add external spine leadership; current direct oversight is seen as effective, with internal talent being developed for future leadership.

• Competitive positioning in spine is strong due to technology quality and access to 7D, with ongoing proceduralization and new product launches like VIRATA.

• Biologics and limb reconstruction segments show stabilization and growth, with new commercial leadership and clinical evidence initiatives.

• Biologics integrated under limb reconstruction leadership, enabling larger distributor engagement and combined product offerings.