Enovis Corp
NYSE:ENOV
US |
Fubotv Inc
NYSE:FUBO
|
Media
|
|
US |
Bank of America Corp
NYSE:BAC
|
Banking
|
|
US |
Palantir Technologies Inc
NYSE:PLTR
|
Technology
|
|
US |
C
|
C3.ai Inc
NYSE:AI
|
Technology
|
US |
Uber Technologies Inc
NYSE:UBER
|
Road & Rail
|
|
CN |
NIO Inc
NYSE:NIO
|
Automobiles
|
|
US |
Fluor Corp
NYSE:FLR
|
Construction
|
|
US |
Jacobs Engineering Group Inc
NYSE:J
|
Professional Services
|
|
US |
TopBuild Corp
NYSE:BLD
|
Consumer products
|
|
US |
Abbott Laboratories
NYSE:ABT
|
Health Care
|
|
US |
Chevron Corp
NYSE:CVX
|
Energy
|
|
US |
Occidental Petroleum Corp
NYSE:OXY
|
Energy
|
|
US |
Matrix Service Co
NASDAQ:MTRX
|
Construction
|
|
US |
Automatic Data Processing Inc
NASDAQ:ADP
|
Technology
|
|
US |
Qualcomm Inc
NASDAQ:QCOM
|
Semiconductors
|
|
US |
Ambarella Inc
NASDAQ:AMBA
|
Semiconductors
|
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
52 Week Range |
38.72
63.8
|
Price Target |
|
We'll email you a reminder when the closing price reaches USD.
Choose the stock you wish to monitor with a price alert.
Fubotv Inc
NYSE:FUBO
|
US | |
Bank of America Corp
NYSE:BAC
|
US | |
Palantir Technologies Inc
NYSE:PLTR
|
US | |
C
|
C3.ai Inc
NYSE:AI
|
US |
Uber Technologies Inc
NYSE:UBER
|
US | |
NIO Inc
NYSE:NIO
|
CN | |
Fluor Corp
NYSE:FLR
|
US | |
Jacobs Engineering Group Inc
NYSE:J
|
US | |
TopBuild Corp
NYSE:BLD
|
US | |
Abbott Laboratories
NYSE:ABT
|
US | |
Chevron Corp
NYSE:CVX
|
US | |
Occidental Petroleum Corp
NYSE:OXY
|
US | |
Matrix Service Co
NASDAQ:MTRX
|
US | |
Automatic Data Processing Inc
NASDAQ:ADP
|
US | |
Qualcomm Inc
NASDAQ:QCOM
|
US | |
Ambarella Inc
NASDAQ:AMBA
|
US |
This alert will be permanently deleted.
Good day and thank you for standing by. Welcome to the Enovis First Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions].
I would now like to hand the conference over to your speaker today, Mr. Chris Hix, Executive Vice President and CFO. Mr. Hix, the floor is yours.
Okay, hey good morning, everyone. And thank you for joining us today for our first earnings call since we launched Enovis and on the call today, of course is also Matt Trerotola, our Chief Executive Officer, earnings release was issued earlier this morning. It's available on the Investors section of our website enovis.com. Of course, we're using a slide presentation to walk you through today's call, which can also be found on the website. Both the audio and the slide presentation of this call will be archived on the website later today. During the call, we're going to make some forward-looking statements about our beliefs and estimates regarding future events and results.
These statements are subject to risks and uncertainties including those set forth in the safe harbor language in today's earnings release and in our filings with the SEC. Actual results might differ materially from any forward-looking statements that we make today and these statements speak only as of today, we do not assume any obligation or intend to update them except as required by law. With respect to any non-GAAP financial measures referenced during the call today, the accompanying reconciliation information relating to those measures can be found in our earnings press release and in the appendix of today's slide presentation.
I would also like to mention that the financial results we will discuss today on this call are adjusted standalone results to give transparency to the Enovis results in the first quarter, we have provided a consistent comparison to prior-year results.
So with that, let me turn it over to Matt, who will start us on Slide 3.
Thanks, Chris. Welcome, everyone. And thanks for joining us for our first earnings call as a MedTech company. We completed the separation of Colfax on April 4, by spinning off our terrific industrial business ESAB into a standalone company, and we renamed our company Enovis, a MedTech innovator with the vision and capabilities to create better outcomes for patients. A great symbol of our new beginning with a ceremonial ringing of the bell, at the New York Stock Exchange with many of our senior leaders.
As I visit with our associates around the world, it's incredible how much positive energy has been unlocked through this relaunch of our company. We're really excited about the robust growth prospects we have at Enovis both organic and inorganic. We're confident in achieving our 2024 goals of sustainable high single-digit organic revenue growth, 20% adjusted EBITDA margins and over $2 billion in annual sales. We will be compounding value for our shareholders from growth, margins and acquisitions, all underpinned by our Enovis Growth Excellence business system known as EGX.
Our Journey to 2024 includes making significant progress in 2022. And on Slide 4, we share some of our key 2022 strategic priorities. We're a growth company. And you've seen our success over the past few years, strengthening our operating, innovation and commercial engines. The result has been faster growth in our markets, and we expect to continue to outpace the competition this year. Over the past 18 months, we improved our company by acquiring businesses that are accelerating our growth, and the integration of these businesses is on track to deliver the expected results. And we have the financial capacity to support more strategic growth in 2022 and beyond.
We're using EGX to support top line and bottom line growth. Through continuous improvement of our operations, we can better serve the customer while improving margins even during the current inflationary environment. The foundation of our success is our associates and I want to thank them for their contributions to Q1. We will continue to invest in our talented teams to drive long-term sustainable competitive advantage. A moment ago, I mentioned acquisitions and on Slide 5, we take a closer look at our progress and success.
Our recent acquisitions include Mathys which substantially expanded our fast growing recon segment outside the U.S. and open up many new opportunities for cross selling our leading products. We also acquired three businesses to create a new fast growing foot and ankle platform. And the LiteCure acquisition expanded our P&R offerings into fast growing treatment modalities and adjacencies. These businesses are achieving our strategic objective of increasing Enovis's growth and margins. They collectively had over 15% pro forma growth in Q1 with gross margins in the mid-60s, both significantly higher than our company averages.
Our teams are making great progress on integration. We recently launched our EMPOWR 3D knee and AltiVate Reverse Shoulder product into the Mathys sales channel. We remain on track for the $15 million run rate of cost synergies by the end of 2024. I was in Switzerland last week for the celebration of the Mathys 75th anniversary, I was extremely encouraged by what I saw, great excitement and momentum in the Mathys team and seamless collaboration with their U.S. counterparts. I also got to check in on the globalization of LiteCure by our P&R team.
We've added sales resources in key countries and have strong revenue momentum and healthy funnels. In our fast growing foot & ankle platform, we've launched two great new products this year, the DynaNail Helix and the Arsenal ankle fracture plating system to support continued strong growth.
These examples clearly show how we use acquisitions to accelerate our strategies and shape our portfolio. We have a full and active pipeline of acquisition candidates and expect to remain active on this key dimension of our strategic value creation model. On Slide 6, we share some first quarter highlights including a strong 21% increase in sales to $375 million, reflecting our acquisition successes and organic growth of 7%. Both of our segments again now grew their respective markets. We also achieved 25% growth in EBITDA and expanded margins, despite the external environment challenges including supply chain and inflationary pressure.
Overall, we're off to a strong start in our first year as a new med tech company. Slide 7 summarizes our 72% first quarter recon segment growth including double-digit organic growth. This performance is well above market growth rates and includes 20% growth in U.S. hips and knees and 12% in U.S. extremities. Our knee growth was significantly above market rates as we continue to make strong progress in the ASC segment. Overall, recon was well above 2019 levels, reflecting sustained outperformance through the pandemic and a strong start to 2022. We have a terrific surgical portfolio that is gaining momentum, scale, and strength.
I commented earlier on the high pro forma growth and our recent acquisitions. The Mathys and Foot & Ankle businesses in recon are performing very well with double-digit growth this quarter. Sales volumes across our recon businesses improved throughout the quarter as COVID related restrictions subsided. We expect continued improvement and elective surgery volumes throughout the year in most regions that will likely encounter some volatility as governments respond to flare ups.
Our prevention and recovery business also demonstrated attractive growth as shown on Page 8. Our 6% organic sales growth was better than underlying market growth and in line with our three year plan to create a consistent mid single-digit grower. Part of our success is due to the 2020 like through acquisition a good example of how our acquisitions can complement and strengthen our businesses.
We grew faster in U.S. P&R markets, as some international markets still had COVID pressure. Our market leading bracing business grew 7% in the U.S., including benefits from MotionMD clinic penetration. And our P&R business has a strong pipeline of new product launches over the remainder of 2022, and we expect to convert that into healthy vitality numbers. We're selectively deploying customer price increases to help battle inflationary pressure, and we'll continue to dynamically manage this.
With that, I'll now turn it over to Chris who will unpack our financial results a little further. Chris?
Well, thanks, Matt. And let me remind that today's call participants that the appendix of today's presentation has a reconciliation between the Enovis go forward financials and our 10-Q financial statements that included the now spun-off ESAB business. Starting the second quarter, we will report a continuing operations presentation that will exclude ESAB from all periods presented.
Turning to Slide 9, sales grew sharply in the first quarter as Matt elaborated earlier. Our acquisitions contributed 15 points of growth. We have one point of currency headwind, and our organic growth was 7%. We had an extra selling day in the first quarter of this year versus last year that contributed about a point of that growth.
In the second quarter, the number of selling days will be less than in Q2 of 2021. Gross margins expanded over the prior years, we realize the benefit from our high margin acquisitions. Our operations teams are keeping customers well supplied in the face of continued supply chain challenges. And we are seeing the inflation we expected for the first half of the year.
Our results reflect the successful initial transition of our corporate costs to a lower level, and we are taking steps to further streamline our cost structure. Our year-over-year EBITDA margin expansion includes these actions and also the investments to support continued fast growth and market outperformance. We expect our margins to sequentially strengthen into the second half due to operating leverage and cost actions. Our first quarter growth and margin expansion contributed to our 25% increase in EBITDA and $0.37 of earnings. These results assume the monetization of our 10% stake in ESAB, resulting in no assumed net debt.
Slide 10 lays this out in more detail. We finished the quarter with $265 million of net debt and a retained stake that was valued at roughly $269 million at the time of separation, net into a slight positive position. We will be funding the separation costs through the end of the year, which could push us into a small net debt position depending on how the ESAB value develops. As a reminder, we will exchange the ESAB stake for our outstanding debt within 12 months of the separation.
Regardless of the timing of the exchange, we have ample financial capacity to support our strategic growth program as we drive the sustainable high single-digit organic growth in 2024. Our outlook for this year is unchanged as shown on Slide 11. We are pleased with our first quarter performance and our start to the second quarter. Top-line risks from COVID have been on the lesser end of the range we identified for the first half of the year.
Flare ups still happen in our markets, but tend to be fewer and with less duration. So organic revenue growth looks to be in good shape and our acquisitions are performing as expected. But we're encountering increasing currency translation headwinds from a stronger U.S. dollar that could blunt some of our reported growth this year.
On balance, we are reaffirming our existing full-year revenue guidance of 10% to 14% total growth. We believe second quarter revenue will be $395 million to $405 million, with the largest performance variables being currency and supply chain. We started the year with expectations of supply chain pressures moderating in the second half, positioning us to take back some ground in 2023. We have not yet seen that moderation.
Accordingly, we continue to add inventory buffers and are taking additional steps to control our costs and increase customer prices where possible. We remain confident our ability to deliver substantial EBITDA growth this year and are reaffirming our previous full-year profit guidance. We are expecting second quarter EBITDA margins will be in line or slightly better than prior year Q2 levels.
So wrapping up on Slide 12, I think you can sense our excitement for the new company Enovis. Several years of business improvements and portfolio shaping have created the foundation for a fast growing MedTech company with real opportunities for margin expansion. We are already delivering clear signs of our progress with strong first quarter performance. We continue to organically grow our markets and our acquisition strategy is clearly bearing fruit, Enovis has a bright future for creating value for our investors.
And with that, Chris, we're going to go ahead and open up the call for questions.
Thank you, sir. [Operator Instructions] Our first question comes from Jeff Johnson of Baird. Your line is open.
Thank you. Good morning, guys. Just a couple of questions here for me if I could and congrats on the first quarter out of the box here, on the 12% U.S. extremities number, is that a shoulder organic growth number just to confirm that, and then maybe just an update on what you're seeing competitive dynamics in the shoulder market here in the U.S.?
Hey Jeff. Good morning, and thanks for joining us in the call. Yes, we're excited to have our first call here this morning. Yes, when we communicate extremities, as you know, that is largely driven by our shoulder franchise. But we talked about pro forma organic growth. So in that sense, it also was reflecting the foot and ankle franchise that we have as well and Matt, any addition?
Any updates there just on the competitive dynamics within the U.S. shoulder market and how the shoulder business is outperformed?
Yes, and the shoulder business, we're confident that we've been outgrowing the market there in shoulder, we're confident we did again in the first quarter looking at our shoulder growth up against, what we can see have reported results there. We also continue to have strong growth in our reverse shoulder as the biggest piece of that by far, but we're also making some great inroads into anatomic particularly with our stem there.
Hey, Jeff. Just to clarify there, just as a coincidence, our organic growth and our pro forma growth with the foot & ankle franchise are both 12%. So just the math just happened to work out this quarter that way.
All right. That's helpful. Great and then Chris, can you just quantify the extra or the less selling day in 2Q, is that a 100 basis points headwind and we should build in 2Q or is it just the one single selling day there. And then on the full-year organic growth, are we still looking at that 6% to 8% is the right range to be thinking for full-year organic growth, I think that's what you've guided to in the past. Thanks.
Yes, let me start with your second question first, which is the 6% to 9% organic growth is what we had outlined for the full-year. And we don't see any real reason that changes. Obviously, the bottom end of that is getting de-risked as we work our way through the first half of the year with less COVID friction. And so we see ourselves organically migrating a little bit up. And now we're seeing of course, this FX friction that's coming in, the currency translation. So we think it's prudent to say in that double-digit growth that we've got for the full-year, totaled growth of 10% to 14%.
On the selling days question in the first quarter, we did mention that we had about a point of tailwind. And as we get into the second quarter, the selling days will be sort of one to, it'll be sort of a point or maybe a point plus as we reflect on the different holiday schedules in both Europe and in the U.S. So there'll be a little bit of a -- little bit of a headwind there for Q2 from selling days.
All right, that makes sense. Thanks, guys.
Thanks.
Thank you. Our next question comes from Matthew Mishan of KeyBanc. Your line is open.
Hey, good morning, guys. And congrats on a good start. Just a follow-up, just a follow-up to that, just how should we think about the 2Q comparisons from last year? And 2Q was a pretty strong recovery around MedTech. Did you also see that, is it a difficult comp for you?
Yes, thanks for the question there, Matt. Yes, we saw as we talked about, and everybody's talked about through Q1, we saw improvement through the quarter here this year in terms of -- in terms of rates. As we get into Q2, we certainly expect to hold that improvement and even get some benefits as the markets outside the U.S. move through the other side of some of the COVID pressure. But at the same time, the comps get tougher because there was some recovery in last year. And so we're expecting the growth in Q2 to be kind of at or a little above what we had in Q1 when you adjust for those selling days, as Chris talked about.
And then as we get to the back half of the year, we expect to be able to have the potential for some nice acceleration depending on how the COVID environment plays out, because obviously, in the back half of the year, the comps get quite a bit easier.
Okay, excellent. And gross margin at least versus our model came in better. Is this a good starting point as we kind of move forward and are some of the inflation dynamics going to impact that through the remainder of the year?
Yes, so thanks for that question, the gross margins in the first quarter were solid, it does reflect the benefit we're getting from the acquisitions that continued work on the operating side of the house. And we view this as we transition to the back half of the year, a clear opportunity for those margins to expand a bit. And that's a combination of operating leverage and the work that we're always doing on the productivity side, inflation is a bit of a wildcard for us something that we're continuing to manage and monitor and work through. And but we still see, regardless of that, we see a pretty clear path to second half expansion in gross margins.
Okay, and then there's two questions on Mathys, I guess first, are you -- do you sense that there's a backlog of procedures that need to be unwound, that we're not done over like the last two years that provide a little bit of a tailwind for European orthopedics? And then can you just give us a sense of, you're launching the EMPOWR Knee into that channel of the dynamics of several different markets, why you think that would be successful?
Yes, sure. So first is as far as the backlog question, I think that if I say generally, not just Europe, but everywhere certainly at this point in time, we've had now three years, if you include the first quarter with limited market growth in the Recon product lines, and so I think everybody seems to believe that, at some point, we're going to be able to get some reasonable amount of that back, because the patients had the diseases and continue to advance.
And so we do expect that in the coming years, there is the potential to have, sort of some market tailwind as that backlog gets worked off, and that would apply to Europe, as well as the U.S. and remains to be seen whether that will come quickly, or more kind of gradually over time. But it's certainly an opportunity for us and the whole industry to take advantage of working off that backlog over time. In Europe, we saw, if we look at the experience of last year or two, certainly each time there was pressure, there was then some nice recovery. And so for example, there's been some pretty heavy pressure in Australia, in Western Australia was shut down for the last handful of weeks, I heard that it's just opening back up.
And so in that market, there's probably going to be a nice little period of recovery as folks try to catch up from some of what they lost during that period. But that's going to vary market by market in terms of how things play out. But we are very excited about the Mathys to start with the double-digit growth that we talked about there perform in the first quarter, and we see great opportunity there to continue the strong progress in that business.
The EMPOWR Knee, Mathys historically has been very strong in hip, they've kind of consistently outgrown the market, they were a pioneer in that market going back 75 years ago. And so they've historically been able to outgrow the market pretty nicely in their hip products. They've done quite well and typically outgrow in the market in anatomic shoulder. But they have not really had a strong position in reverse shoulder. And in particular in knee, they've had products that were pretty long in terms of how long they've been out there and not winning share in the markets.
And so we do see great opportunity, the team over there is thrilled to have the EMPOWR Knee coming in. And there's already been some good activities to get KOLs educated and excited over there, collaborating with some of our KOLs from over here, we've already had some initial rounds of being out in the marketplace and talking with surgeons and getting them ready to try the products and now we've got the instrument sets in the market and are going through the launch there here in May. And so we've had terrific responses in key markets over there.
And we do expect to be able to build some nice momentum over time in the EMPOWR knee and flip that position over in knee from a below market growth position to an above market growth position as we work through this year and into next year.
Thank you for taking the questions guys.
Thank you. Our next question comes from Vijay Kumar of Evercore ISI. Your line is open.
Hey guys, thanks for taking my question. And congrats on a good start here. Maybe my first one on the guidance, hi guys. On the first question here on the guidance, total revenue growth of 10% to 14% was up re-traded but I'm assuming FX did get intimately worse. So perhaps could you talk about whether the underlying organic growth assumptions accelerate and perhaps some of that is masked by incremental FX headwinds, watching on FX and did anything change on pricing contribution for the year versus prior guidance?
Okay, thanks for the question, Vijay and good morning. Yes, so as we commented on earlier, keeping the total growth in place to 10% to 14% embodies within it the previous 6% to 9% organic growth. But as I commented a moment ago, what we're seeing is a COVID de risking in the first half of this year, that gives us confidence that that, we're sort of sliding up the scale from the six moving closer to the middle or higher end of that range there with that possibility. On the other hand, we've got a little bit more FX headwind that's come into play. And so we put all that together and said, hey, it looks like the 10% to 14% guidance, the double-digit guidance, growth guidance for the year makes sense to maintain.
In terms of FX, we started the year with an assumption, it would be about a point, looks like that, if rates hold the way they are, we may have added another point on top of that. But still, that doesn't disrupt the overall story that we've got it just means we have to take that a clear eyed look at that, as we look at the guidance for the year, but the organic growth, the fundamental healthy organic growth that we've got is, I would argue we started that six to nine, and we're, it has a strengthening profile now that we've gone through the first quarter, and that we're about halfway through the second quarter.
Yes, and Vijay, speaking to price, talking about we had quite a bit of inflationary pressure in our P&R businesses in particular over the last year or two, and the back half of it last year started to get some price and have gotten more here in the first half. And so we continue to work at to monitor that inflation, and to put price through wherever we can in different places around the world in different channels. And we've also gotten some help in some cases from reimbursement changes and from being able to make changes in GPO contracts and things.
And so I would say the amount of price is kind of modestly ticking up as we work our way through the first half of this year, but not in a way that substantially changes the growth outlook. But in P&R, certainly, we're working hard to make sure that we start to pull back some ground on price cost in the back half of this year, even as inflation stays high. And then we're positioned as we move into next year and beyond to pull back more of that price cost squeezed on the P&R side.
That's helpful. And then one on margins here. We started Q1, call it low teens. Maybe just talk about the progression here. I think your adjusted EBITDA targets imply mid-teens perhaps at the upper end of mid-teens margins. Is there a seasonality here in terms of how expenses ramp or what was the gross -- function of gross margins maybe talk about some of the drivers here on the first half or the second half cadence on margins?
Okay. Yes, there is an underlying fundamental element of seasonality to the margins, and that they're tied to some degree to the revenue profile. That is as we get more revenue, we get more operating leverage. So it's not uncommon for us to finish the year with very strong fourth quarter. And then as first quarter revenues are typically the lowest in a year that we would see the lower margin profile, you put that together with the improvements that we're making in the business.
And I think there's a pretty clear path here is, in fact, the comments we made in our prepared remarks suggests that we expect margins to step up from Q1 to Q2, no surprise there with stronger seasonal revenues and other improvements we're making. And then as we get in the back half of the year, we'd expect to see the margins in the second half higher than the first half of the year. Given that the overall higher revenue level between the two periods and the first half and the second half. And the improvements that that we continue to make in the business on the cost side. It's a combination.
We talked about, our corporate costs are coming down. And in addition to that, we're doing some other work on overall OpEx and the company. And then there's the usual work that we do on productivity in the operations side of our business. Now, all of that gets reflected in the improving EBITDA profile that we've got, some of it shows up in gross margins, because of the operating leverage and the productivity and the sourcing and operational side. And some of it shows up only in the EBITDA margins because of the OpEx improvements that we're making. So yes, we do have a nice path forward to improving margins from Q1 through the end of the year.
That's helpful and if I could squeeze one more in, I think U.S. bracing is something that you called out in your presentation prepared remarks. How -- when you look at the highs and lows, U.S. pricing growth number might. How much of this was normalization of volumes versus share gains and maybe talk about what drove that U.S. performance?
Yes, sure, Vijay. So for sure, there's a little bit of price in that, and a little bit of normalization of volumes, but we still feel like it's an above market share gain profile. And I think we've been able to stay in a solid place, supporting customers through the pandemic. And as we've come out here, at the end of last year into this year, our delivery levels have improved. We've made some strategic inventory investments to make sure that we're protecting our customers there.
And so we do think that our ability to serve customers is helping U.S. We're also kind of well into the double-digits in terms of a new product vitality, and we've been talking about for a few years now that, once we get back into a healthy vitality position in that business, we'll be able to leverage our strong brand and channel leadership and drive above market growth. And we continue to make nice, nice progress on gaining clinics with our MotionMD, software and workflow technology and having that be a way that we increase our penetration into the marketplace.
And so we think all those have, have come together to put us back into a solid leadership position in U.S. bracing that should enable us to drive at or above market growth over time. And in the first quarter, we were in that above market growth range.
Understood. Thanks, guys.
Thanks, Vijay.
Thank you. And we have a question from Josh Jennings of Cohen. Your line is open.
Hi, good morning. Thanks for taking my questions. I wanted to touch on with knees and hips business, and really strong growth here in Q1. And congratulations on the start and initial quarter as a public company for spin. But just thinking about the ASC channel, and how Enovis is positioned there, and did you see outsides growth in ASC versus the hospital channel in the U.S.? And then the second follow-up question is, is just on robotics. I believe, historically, your inputs have had compatibility with things surgical key solution want, and just wondering if you're seeing any traction there or getting any lift from that partnership?
Thanks for question, Josh. So first of all, yes, the hip knee growth was nice and strong in the quarter with knee being very strong, and fueled by that that ASC physicians. And it's not just one quarter, I could go back and compare it to '19, which someday we could all stop doing, I think you'll find it's quite remarkable how much ground we've covered in that period of time versus the versus the peers. So we really have a powerful position there in hip and knee that is gaining share consistently.
ASC is a key part of that. Our knee is a knee that is more stable. And it really was a kind of a breakthrough knee, the EMPOWR 3D knee when it came out and has had better stability, which it takes the patient satisfaction levels up, particularly for younger patients that are looking for a more stable knee. And those are the patients that are good fit for the ASC. We've also, in many cases already got physicians in the ASC and their clinics, through our other businesses on the P&R side. Our brands are known, that's been an asset to us as well as we serve the ASC.
And so we've shared that, our businesses is approaching 20% of it in knee and in the ASE, which we believe is well above the percent of the market that is in the ASC. And so we do believe that in Q1 again, that strong position in the ASC help to fuel our knee share gain, in particular. On the robotics front, we've talked about our strategy in our Investor call a month or two back. We talked about our strategy there that we do think that surgical workflow and computer assisted surgery are very important parts of where the market is going in recon.
And our strategy is really to have the right solutions for each part of the anatomy and for the settings that are growing the fastest. So we like, we've always had a great for years, I've had a great surgical planning solution, which is really critical solution there. We have had some collaboration with think in the past that has been a way for patients to have access to a large robot if they're looking for something like that. And that's been a nice collaboration there.
We also shared lately at the academy, our augmented reality guidance system that is 510(k) cleared and we'll be making, bringing that into the marketplace. And we believe that that augmented reality solution is going to be a great breakthrough, particularly for the ASC environment, given the space constraints and the time constraints there.
And so we see that as a critical mix part of our offering there, in hip and knee to be able to continue that strong growth in ASC. And we'll continue to evolve our solutions across each part of the anatomy to make sure that we remain in a strong position.
I appreciate that. Thank you and let me follow-up on Mathys. And that's going to turn organic I believe, in a month or so. And wanted to just better understand or just get a reminder of geographic expansion plans, as you move forward outside of Mathys has covered geographies, and also just new prudent product registrations and how the MDR process has been going. You guys have launched EMPOWR putting knee in all to the reverse into the Mathys sales channel. What's to come as we move through this year, and it's 2023. So it's just geographic -- further geographic expansion plans, using that business footprint, and also a new product registration. So in the next 12 to 18 months? Thanks a lot for taking the question.
Yes, sure. Thanks, Josh. So the thing I'll clear quickly is our P&R business is extremely global. We're a global leader in each of our key businesses, they're bracing and in rehab. And that's something that is a strong position that we're continuing to build on. Mathys was really a significant globalization of our shoulder business. We had very limited -- or sorry, our recon business, we had very limited recon business outside the U.S. and the acquisition of Mathys did a couple things for us. One, it gave us, a significant amount of outside the U.S. business, some key direct channel positions in key attractive markets.
And it also brought a very complementary product line, as I said earlier, they were strong and hip and anatomic shoulder, we've always been very strong in reverse shoulder and in knee we've been building out a strong hip position as well, in the U.S. And so just really a hand in glove fit in terms of our joint product lines, and a great chance to drive cross selling.
And, as I talked about, we've already started that cross selling now with the EMPOWR, and the alternate coming in. We already had key parts of those offerings cleared outside the U.S. And so the Mathys team is already actively in a number of markets selling those products, and we expect those to create the first wave of synergy between our companies from a revenue standpoint. Obviously, we're actively working on MDR. We've been through a lot of the work on our class one products -- the work on our class one products in P&R. And now, we're working actively on the recon products and some of our rehab products.
And we've got a great team, great plan in process. We've been able to do some nice cross learning between Mathys and our teams that we had before we acquired Mathys, and I think improve our approaches there. And it's a significant investment that we need to make in those clearances. But it's also an investment that not everybody is going to be able to make, and we do think there's going to be some advantages to leading players who make those MDR investments, and over time, they'll probably be more or not less acquisition opportunities that arise based on some of the barriers that are created from that MDR.
Great, thanks again.
Thank you. Speakers, I see no further questions in the queue. I will turn the conference back over to Mr. Chris Hix for closing remarks.
Okay, well listen thank you all for your interest in Enovis and we look forward updating you on our progress throughout this year. So thank you.
This conclude today's conference call. Thank you all for participating. You may now disconnect and have a pleasant day.