Enovis — Third Quarter 2026 Earnings Summary

Financial Performance:

• Third-quarter net sales reached $559 million, representing a 2% increase on a reported basis and a 5% increase on an organic basis compared to the same quarter in 2025.
• Third-quarter net income was $3 million, or 0.6% of sales, compared to a net loss in the prior year period.
• Adjusted EBITDA was $104 million, or 18.5% of sales, compared to $94.8 million (17.3% margin) in the prior year quarter.
• Reported net income per share was $0.02, while adjusted net earnings per diluted share were $0.88.
• Gross profit margin for the quarter was 60.8%, up from 59.9% in the prior year quarter.
• For the nine months ended October 2, 2026, net sales were $1.73 billion, up 3.5% reported and 4.2% organic.
• Nine-month adjusted EBITDA was $311.4 million, or 18.0% of sales.
• Nine-month adjusted net income per diluted share was $2.67, compared to $2.12 in the prior year period.
• Cash and cash equivalents stood at $13.0 million as of October 2, 2026, down from $36.4 million at year-end 2025.
• Total debt (current and long-term) was $1.26 billion as of October 2, 2026.

Guidance and Future Outlook:

• Full-year 2026 revenue guidance was narrowed to $2.32–$2.35 billion, incorporating 5% organic revenue growth.
• Full-year 2026 adjusted EBITDA guidance was raised to $428–$438 million.
• Full-year 2026 adjusted earnings per share guidance was raised to $3.58–$3.79.
• Foreign currency is now expected to be a benefit to revenue growth of 0.5%–1.0%, down from the previous 0.5%–1.5% outlook.
• Full-year free cash flow conversion is expected to be 25% or higher.

Business Segments and Product Lines:

• Reconstructive sales grew 6% on both a reported and organic basis in the third quarter.
• Prevention & Recovery (P&R) sales declined 2% on a reported basis but grew 3% on an organic basis.
• U.S. Bracing & Support sales grew 4.5% in the third quarter.
• U.S. Other P&R sales declined 14.2% on a reported basis but grew 5.1% organically, reflecting the impact of the Dr. Comfort Footcare Solutions divestiture in the prior year.
• International P&R sales declined 1.2% on a reported basis and 0.7% organically.
• U.S. Reconstructive sales grew 4.9% in the third quarter.
• International Reconstructive sales grew 7.0% on a reported basis and 7.8% organically.
• The company highlighted encouraging momentum in new product introductions.

Market and Competitive Landscape:

• The company noted continued share gains in the Reconstructive segment.
• The operating environment remains dynamic, characterized by volatility and cost inflation in many markets.
• The company is investing in technologies to define the next phase of growth, specifically referencing the acquisition of eCential Robotics.

Risks and Challenges:

• Risks include the planned acquisition of eCential, including the timeline, funding, and financial/operational impact on Adjusted EBITDA margins.
• Risks include the integration of Lima and the impact of public health emergencies, global pandemics, and geopolitical tensions (Russia/Ukraine, Middle East).
• Risks include macroeconomic conditions, inflationary pressures, changes in government trade policies, and supply chain disruptions.
• Risks include increasing energy costs, particularly in the European market, and potential U.S. government shutdowns.

Management Commentary and Tone:

• CEO Damien McDonald stated results reflect continued progress against an innovation-led strategy and benefits of executing with alignment, accountability, and discipline.
• Management described growth as consistent with expectations, noting steady performance in Prevention & Recovery.
• The tone emphasized maintaining strong cost and capital discipline while investing in future growth technologies.
• Management expressed a focus on continuously improving operations to make performance repeatable and increasingly profitable.

Other Key Points:

• The Board of Directors approved a new $200 million share repurchase authorization, replacing the existing $100 million authorization.
• The company announced an agreement to acquire eCential Robotics.
• Strategic transaction costs for the quarter included $15.6 million, primarily related to the integration of the Lima acquisition and other non-recurring project costs.
• The company revised its definition of Adjusted Net Income and Adjusted EBITDA to no longer adjust for inventory step-up charges, resulting in restatements of prior period non-GAAP figures.
• The Dr. Comfort Footcare Solutions product line was divested in October 2025, impacting prior year comparability.