Thank you. My name is Caroline Borowski, and I'm a member here at the J.P. Morgan Healthcare Investment Banking Group. It is my pleasure to introduce Matt Trerotola, Chairman and CEO of Enovis, and Ben Berry, CFO of Enovis .
Thank you, Caroline. It's great to be here. Good morning, everybody. Good afternoon for those of you joining from the East Coast. We're glad to have an opportunity to present our company. You can read through the forward-looking statements comments at the beginning of the presentation. Then I just wanna jump in on slide number three. This is a page that just as a quick introduction to our company. We're Enovis , an innovation-driven growth company in the med tech space, focused primarily in orthopedics today. As you can see, we're approaching $2 billion in revenue. Our guidance for the year is in the 7.5% organic growth range.
We got healthy profitability, but with good opportunity to continue to expand our profitability over time as we scale and improve the business. You can see the split of the business at the bottom. We're, you know, global and becoming more global, and we've got two major segments. Our Recon segment is a double-digit organic grower that we've been growing aggressively over time. It was less than 20% of our med tech business back in 2019, and as you'll see in a few slides, it's gonna be almost 50% on a pro forma basis as we step into 2024.
And then, P&R is our Prevention and Recovery segment, is really leadership positions and embracing and rehab and products that have some nice complementarity to what we do in our Recon business, as well. The next page really focuses on our, you know, strategy and goals, and on the right, you can see our strategic objectives that we've been driving, really aggressive expansion of that Recon. I talked about how aggressively we've been expanding that. Shaping and improving our P&R business is really reestablishing strong leadership positions in our bracing and rehab businesses, and driving nice improvements in those businesses. And really start to scale our company and get some of the margin benefits that come with that scaling.
Really, the strategic drivers of how we've been doing that are things that go back into our history, as I'll talk about in the next page. We, for many years as a company, have had a relentless focus on talent, really trying to attract the best team, engage the best team, and make that a key part of our strategic advantage as a company. On the lower left, you can see EGX. That's Enovis Growth Excellence. That's our business system, which is a continuous improvement business system, which was really designed after the Danaher business system based on our heritage. And innovation. We're very focused on innovation and driving growth through innovation, and we use our EGX tools to have great innovation processes.
But then we also focus on, you know, driving differentiation and innovation, not just in the products, but also a lot of focus on digital and driving innovation in workflows through digital technologies and really, you know, driving strategies to get at the data and all the opportunities that'll come with AI and things for what can be done with that data over time. And then finally, acquisitions have been a key part of how we've grown and improved our company over time. We've got a very strong capability in this area to do great acquisitions and integrate them well and get, you know, great returns for our shareholders, but also drive our strategies forward and strengthen our portfolio.
On the bottom, you can see our strategic goals have been to drive to $2 billion in revenue by 2024, and really in 2023 on a pro forma basis, that's about where we are. High single-digit organic growth, which you can see we're driving this year as well, and at least 50 basis points per year of margin improvement, which we've been successfully driving. With an opportunity, we're just moving to the high teens here in margins now, have the opportunity, we're comfortable to drive to, you know, above 20% margins and beyond over time, based on the opportunities that we have in our businesses. This page talks a little bit about where we've been and where we're going.
Really, in terms of our history, we were founded as Colfax back in 1995 by Mitch and Steve Rales, who founded the enormously successful Danaher Corporation. I spent a number of years of my career at Danaher, as did some of our other key leaders. You know, our business was founded as an industrial company, really taking a similar approach in terms of having a strong business system based on lean and continuous improvement and driving both innovation and acquisitions, as I talked about on the previous page, as a way to compound value over time for shareholders.
We, over the past number of years, have focused the company in med tech, with the final step of that being the spin-out of our ESAB business as a public company in early 2022, and the renaming of our company as Enovis , a focused med tech innovator. ESAB has been very successful as a public company, and as you can see in the middle, we're off to a great start as Enovis as well. Growing, you know, actually, you know, before currency, comfortably into the double digits as a company, 9% CAGR, when you factor in some of the currency headwinds through this period. Have increased our margins. This is a period where in the ortho space, there hasn't been a lot of margin improvement.
There have been some tough, tough headwinds. We've had good, healthy margin improvement, and have done about 20 acquisitions since 2019 in these businesses, and I'll talk about some of them as I go through the presentation. We step into 2024 with a lot of momentum, a lot of opportunity. We just closed last week the acquisition of Lima, which we had announced right at the end of Q3. So closed right on track at kind of the early end of when we were focused on closing that deal on January 3rd. We've had a lot of opportunity to put together aggressive and thoughtful integration plan, partnering with them, and so we're really hitting the ground running.
And the metrics that we shared when we announced the deal are still, you know, fully intact, and as I share on the page here, we expect to have those come on top of our core guidance for this year. So great opportunity with Lima. I'll talk more about that. We've built a foot and ankle business over the past number of years. It's building great momentum, as well as a strong grower in an exciting market, and we've really got some great NPI momentum. We had some great products from last year that are gonna be ramping this year, and we've got some great products we're launching this year. So really excited about the momentum we have as we enter this year. I talked about the Lima acquisition.
This is really a big deal for our company, pretty transformative, especially for our Recon segment of our company, and obviously, we've been focused on aggressively growing that Recon segment. This shows you the impact that this has on a pro forma basis. You know, you know, we have you know about $300 million coming in, and it's all Recon. And so now we're at almost 50% Recon, which is the faster growing and a higher gross margin, significantly higher gross margin part of our company. So that's you know very positive.
We've become more global, but in a very attractive way in terms of which countries and what positions, and a step change to our margins just on a pro forma basis, and then a lot of synergy to get after that, that can create additional margin opportunity as well. So with this acquisition, we've got about a $1 billion recon segment that has very attractive mix, great opportunities for growth and profit improvement over time. This page talks a little bit about where we compete. We compete in the $50 billion+ very attractive orthopedic market segment, great long-term growth drivers on the right that are consistent long-term growth drivers for these orthopedic markets.
Our Recon business, the $1 billion Recon business, competes in about $20 billion of this market, and what's very important is you can see that while extremities is a smaller part of the Recon, of the surgical market here, it's the fastest-growing part on the page, and our Recon business is about 50% extremity. So we've got a very attractive mix in our Recon business, and we grow very fast in hip and knee as well. Our PNR business is in that $5 billion slice that cuts across the whole market. We've got about a $1 billion or so position in that, so more leadership positions here. What's great about these businesses is that they're adjacent to all these surgical markets, and so the surgical markets we're in, we've got synergy opportunities.
The ones we're not in, we know quite well from our participation in P&R, we can make very thoughtful decisions about which of those we do or don't choose to participate in over time to keep our company very strong and differentiated. This is a different view of where our company fits into the orthopedic space. We think this is a very attractive position, this middle tier, where we are a scaled player that has, you know, good, solid margins, opportunity to keep scaling, an opportunity to generate strong cash flow over time to fuel our growth. But at the same time, we've got room to choose where else we participate in orthopedics. Plenty of room to grow without having to slow down our growth rate.
We can pick and choose how we grow our company, where we grow our company in orthopedics, and when we might choose to go into attractive adjacencies to orthopedics that have strong growth and margin fundamentals, as well. Also terrific that orthopedics has a nice fragmented base that you can see from the page before. We've already taken advantage of in terms of driving strategic acquisitions that accelerate our strategies, shape our businesses in an attractive way, and have great returns for shareholders, and there's plenty more of that opportunity in the base of this pyramid. We also have a unique position in orthopedics in terms of where we fit into the care continuum in the industry. We think this is becoming more and more important over time, based on some of the trends in the industry.
We are the only player in orthopedics that participates significantly before, during, and after the surgical procedure or the injury. And that has given us opportunity in terms of brand leverage, in terms of awareness with clinicians, being able to leverage, you know, surgeons to help us with surgical designs, but also help us with bracing designs, for example. But more and more, it's creating new and even more powerful strategic advantages. We've driven digital workflow advantages in clinics that give us an advantage in the industry. We have connected medicine products, both connected braces and also more app-based connected recovery products that create, you know, synergy across this continuum of care.
As the ASC becomes a bigger and bigger part of this industry, as a you know place to do the surgery, many ASCs participate in multiple parts of this continuum of care. So the fact that we are known there, that we have access there, that we have opportunity to bring solutions that can cut across that, is something that gives us the benefit today in terms of our success in ASCs and something that we envision additional opportunities over time. Talking a little bit about our Recon segment. This is a pro forma view, where we've kind of included in the Lima business, so you get a feel for as we've closed the business last week, what our Recon segment looks like.
It's about a $1 billion segment, about 50% extremities, which, if you remember, is the fastest growing part. It's also the higher gross margin part of the industry as well, which is terrific. It's an advantage for us. We also are about 50/50 inside the U.S. and outside the U.S., and our participation outside the U.S. is in mostly in the most attractive markets outside the U.S. And so I think with the opportunity to keep building a balanced global business and participate in the best segments and the best markets disproportionately over time. Great technologies across the bottom here in terms of our key implant technologies we've had in Enovis, but then others that have come through the acquisitions.
A great opportunity to keep growing double digits in this Recon business, get after the growth, the synergies that are coming from the acquisitions, as well, and really leverage a number of great technologies that we have, both in terms of kind of traditional technologies for designing implants, but also enabling tech, you know, ARVIS, I'll talk about in a minute, our augmented reality solution, and other enabling tech that we can bring over time. So just terrific opportunities to keep growing double digits in this very strong Recon portfolio, and the acquisition we closed last week just strengthens that even more. Our double-digit growth in Recon is driven by innovation. That's the primary driver of our double-digit growth.
We have a reverse shoulder and a knee product that are just better products. The reverse shoulder has been the preferred way. It, you know, it's been kind of accepted now as the best way to do a shoulder, and the lateralized and inferiorized in the U.S. has really become the accepted way to do a reverse. And so we've got the product that's been around the longest, has the most data, and really the best reverse shoulder. We've also got a knee product that is a just a kinematically better knee, a dual pivot knee that acts more like your natural knee, and it really tapped into an unmet need for higher satisfaction, having a patient feel more like their knee was their normal knee.
We've driven a ton of share with these two flagship products in the U.S., and now have all kinds of landscape outside the U.S. in terms of cross-selling opportunity. But then we've been innovating on top of these, of course, a continual pace of innovation. You know, big one in knee is our revision that we brought out last year, that accesses another almost 20% of the knee market for us. In shoulder, we've got augmented glenoid coming through the pipeline. They're an important innovation there. And beyond the implants, our ARVIS enabling tech is, you know, just broadly launched second half of last year, is really kind of the next wave in enabling tech, particularly fit for the ASC environment. I'll talk a little bit more about that.
We've built a great foot and ankle business, a number of great technologies that are differentiated, better outcomes, better surgical procedures, and we've got this great opportunity to expand our business globally and drive a lot of cross-selling opportunity. So we've been driving double-digit growth through innovation, and we're gonna keep driving. Now, I get asked a lot: How the heck do you grow double digits in Recon consistently, and how much longer can you do this for as you become a larger player? Now, we're about a five share player globally in Recon, so we're big enough to be a, you know, top-tier player in the industry, but we're far from running out of running room. A little bit of detail here, just because that question comes up so much.
This is a page without Lima, which shows the split of our Recon business. The growth rates, you can see that our weighted average market growth rate is above the market because of that great mix I talked about. So we're already starting at about 5%-6% weighted average market growth rate, and then we consistently have grown above market. I'll show you a decade of history on this, but we've consistently grown above market in each of the anatomies, and we're expecting to be able to do that over time. Plenty of running room, the way we see it. And you can see nine months of 2023. Hey, 2023 was a year where there was some tailwind on Recon markets, right? I think if you look around the industry, you'd probably say there was at least a point or two of growth tailwind in 2023.
And so that 15%, 9 months, okay, maybe that's more like 13% or 14% in a normal market environment, but still very much within that 10%-15%, that is our, you know, our focus for growth for these markets. Now, Lima comes in with a better mix in the international Recon business than we had, so it shapes up the WAMGR of that piece by a little bit. And if, You know, for the last couple of years, they've been growing well into the double digits, well above market. And so, you know, if anything, that enhances our ability to drive this kind of growth in our Recon business. Now, this is not a flash in the pan. This is just the U.S. part of it, that we've had the longest.
10 years of double-digit growth, on the shoulder side, on the hip and knee side. And we get a lot of questions about whether, you know, without a big robot in knee, can we keep growing? You know, we're 21% year to date last year through the end of the Q3 in hip and knee, and the knee growth is higher than the hip growth. So, you know, even in an environment where there is, you know, enabling tech and robotics and things, we've continued to drive tremendous growth, in our knee business, and we see plenty of opportunity, especially as we bring ARVIS into the market late last year as well. Enabling tech is a, you know, really important, part of how you succeed, in the Recon business today and into the future.
Our strategy is really what's on the page. We've been focused on this strategy and been driving this strategy. We're really focused on the right enabling tech for each anatomy. We see this, this is about workflow. This is about a surgeon's workflow and how you come alongside of that and use technology to make it better. So in shoulder, we've had industry-leading preoperative planning and patient-specific instrumentation. You know, in ankle, we launched last year, industry-leading planning and instrumentation as well.
And in knee and hip, we launched ARVIS, which is a really, you know, the next wave in technology for guidance to enable the surgeon to plan their surgery, feed it into the surgical procedure, and then be able to make their own judgments in the procedure, but be able to see the plan overlaid right onto the patient. And we're finding a lot of surgeons find that very attractive and even, you know, more attractive maybe than having a robot do it form . And it's also just tremendous fit for the ASC environment, as well. And we're really focused on making sure that these offerings really take into account how much of the market is moving to the ASC.
And so we keep the capital costs manageable, make them time and space efficient, and make the footprint small, because that's, you know, what people need in these offerings in the ASC, and we're finding that that's being very well received by the market, as well. We also have the opportunity, certainly over time, to take ARVIS into other anatomies. It is primarily software-based, and that means that the path to develop it into other anatomies is, you know, one that does, you know, does not take too much time or cost. So, right now, we're really ramping it in hip and knee, and particularly knee, but certainly an opportunity to take it into other anatomies and, you know, an opportunity there. M&A has been a key part of how we grow.
This page highlights the M&A that we have done in Recon. Two big, you know, globalizations through Mathys back in 2021, and then Lima closed last week. The Mathys deal has been very successful. We've exceeded our revenue, cost, margin, returns on that deal. So very successful deal, showing that we can, we can do this, we can do it successfully. And now Lima comes. It's a tremendous business to add in its own right, but then it's got great synergy with Mathys and with our U.S. based business. We did a handful of acquisitions that built a great foot and ankle business that is kind of rounding the corner on $100 million of revenue globally, as we move into this year. Double-digit grower, great technologies in the space.
And then we've done some great investments and acquisitions in the enabling tech space as well. The ARVIS. ARVIS was something we made an investment in Insight, came alongside of them and developed together, and then wound up, you know, buying out the company at the appropriate time and bringing it in and now using it to develop other things. I wanna switch gears and just talk for a minute about PNR. Our PNR segment's about a $1 billion segment in a $5 billion market, so about 20% or so share. So we have leadership positions in bracing and in rehabilitation technologies.
And we really have been really turning this business back into a very strong leader by getting the innovation content up by you know driving a lot of improvement in the supply chain and service in this business and by driving differentiation in the workflow in clinics and orthopedics with our MotionMD solution. This page gives you a little bit more flavor for this P&R segment. It is a you know strong low to mid-single digit grower that has good margins that we keep improving and good strong cash flow. And it's a great complement to our Recon business because it gives us the cash to drive the strong growth in that Recon business. The biggest parts are bracing and RS.
Those have been growing in that low to mid-single digits range, so plenty of opportunity to continue to grow this portfolio consistently in low to mid-single digits. Profitability's been improving, and at 14%, still has got room to go from there. While we had to sink some cash into this business, you know, during the pandemic, you know, as everybody did, with having to kind of put extra inventory in the system, et cetera, now, as we've come through the backside to a more normal environment and having our EGX driving improvements through this business, we're getting, you know, 100% plus cash conversion with that opportunity over time, as well. Innovation was close to nothing in this business back in 2019, when we acquired these businesses.
Now is double digits, vitality on the way to high double-digit vitality, and that's part of how we're driving consistent share gain in our PNR businesses. Then finally, in PNR, embracing MotionMD has been a significant advantage for our business. We have brought to the market a software-based workflow solution that is integrated into the ERPs of the orthopedic clinics. We are integrated into over 40% of the orthopedic clinics in the U.S. And when we get that position, we get more share of wallet, higher gross margins, and more stickiness because of the value that we are bringing to those clinics. So that's something that is helping us to grow above market in bracing and will continue to help us on a go-forward basis to grow above market in bracing.
It creates some interesting opportunities, as now, like, some of those clinics are actually part of ASCs, and so all of a sudden, we're now, we're there, and we're running the orthopedic clinic in an ASC environment. We're very relevant there, to my comments earlier about the strategic advantages that are created along the continuum of care. So I'll wrap up with this page, really just talking about the strong progress we've made on our key goals and the great momentum that we have as we step into 2024. We've been focused on building a high single-digit grower as Enovis , that is double-digit Recon and consistent low to mid-single-digit P&R, and that's exactly what we did last year, with 8% year-to-date nine months.
We've also been focused on driving expansion in our margins at least 50 basis points a year, and have continued to do that for the last couple of years as well. And what's great about that is it is GM led. So we've been expanding our gross margin significantly, especially 'cause the highest gross margin parts of our portfolio grow the fastest, and that's enabled us to invest in things like enabling tech and key technologies that are gonna fuel growth in the future. And then we still have plenty of room to keep scaling our OpEx base over time. So stepping into 2024, great opportunity. Expecting the market to probably have a little tailwind on it again in 2024, as there's still a backlog out there, you know, in terms of elective procedures. Great innovation momentum for us.
We've been working hard to make sure that we're, you know, driving pricing and fighting inflation and making sure that we're ready for whatever environment continues to unfold there, and scaling and getting after the synergies in our acquisitions. So great momentum as we step into 2024. Excited to talk about it as we work through the year. Thank you.
Thank you. Now we'll move on to the Q&A portion. So you talked a little bit about 2023. Can you provide any updates specifically on it?
Well, as you see in the presentation, you know, we, we shared, you know, what we had given as the guidance at the end of the Q3 . We also, you know, shared the, you know, the kind of, Lima numbers that we announced at the end of the Q3 . And, and so, you know, we're, we're comfortable. Good, good, strong finish to the year, excited about the momentum coming into 2024, but we're not giving any, you know, official update on 2023 beyond what's in the presentation.
Great. In terms of 2024, how are you thinking about the year from an operating environment? What are you assuming about markets, elective trends, recessionary pressures, and all of that?
Yeah, sure. You know, from a market environment, you know, we're certainly watching carefully how things go as we start out the year. But, we feel like, you know, elective surgery had a, you know, good, healthy finish to the year, and so there's every reason to believe that, there'll be a good start to 2024. You know, as we've talked about and others have talked about, there's certainly, you know, good logic that would suggest that there could be another year of tailwind on the elective surgery markets, 'cause there certainly is a, you know, sort of a backlog of unserved patients that still need to come through the pipeline.
But we'll be watching carefully, you know, how that plays out, especially in the first part of the year, where things were, you know, pretty hot earlier in the year, last year. And so, you know, we certainly expect a good, healthy start to the year. Whether there'll be any extra tailwind, you know, early in the year or not, you know, we're kind of waiting to see how that plays out. You know, inflation is, you know, more stabilized, but hasn't gone away altogether.
So we're certainly pleased that it is a much better inflation environment than it was a couple of years back, but we're still working hard to make sure that we're getting price wherever we can, or, or minimizing price erosion wherever we can, so that we can, you know, kind of deal with some of the, you know, things like labor inflation and things that continue to come through. But we feel very comfortable with our ability to continue to, you know, hit the kind of margin goals that we've talked about of at least 50 basis points a year.
Awesome. And in terms of M&A, the Lima acquisition update that you provided, you closed that recently. Do you mind kind of providing any updates on integration plans and key milestones for 2024 on that?
Yeah, for sure. I mean, this has really gone very well. We, you know, we announced it there at the end of September, and, you know, had a great opportunity for three months to work on integration planning together. And, we, we've got, as we've shared publicly, we've got Brady Shirley taking the leadership of that and really focusing, you know, a large portion of his time on making sure that that deal is a great success. We got, you know, strong, experienced integration leader, great team on both sides. And so, we have done really terrific integration planning through the last couple of months of last year.
So I feel like we're hitting the ground in a terrific place in terms of you know good alignment on priorities and an ability to you know not miss a beat in terms of some of the core things going on in the business and start getting after the synergy opportunities you know very quickly.
Can you maybe walk through the specific guidance you would have given for year one, and any plans for dyssynergias from the integration process for Lima?
Yeah, we've contemplated that in the numbers that we've given in terms of what we expect 2024 revenue and EBITDA to be. So if you look at, You know, you have some public information out there on Lima because they had debt they were publicly talking about. So overall, we would say, you know, you can kind of do the math based on what they had kind of done and where they are, you know, kind of projected to land for this year and kind of look at what we've guided, and you can kind of do the math to understand what the dyssynergia that we've planned and incorporated into our guidance. We know that there will be some, based on all the acquisitions that we've done and the history that we have of integrating the channel.
We know there'll be some disruption, so we've been a bit conservative on our approach there, and we're doing the hard work of the integration to make sure that we hit the ground running, you know, as we've started the year here with them as part of our company.
Great. In terms of your leverage, where does that stand post Lima?
We'll be about three times leveraged in 2024 with Lima, so pretty comfortable positions. The capacity to do some small bolt pass, but we're going to be very much focused in 2024 on integrating Lima and doing it well. And I would say our kind of acquisition appetite is much smaller as we do the work to make sure that the integration goes successfully.
Awesome. Maybe in terms of M&A on a more broader scale, will we see more technology and tuck-in acquisitions? Where are you focused? What are potentially some bigger opportunities? Are valuations changing? Can you just kind of describe your acquisition pipeline?
Yeah, sure. Obviously, we've been quite active last year, so, you know, did a handful of really great acquisitions, culminating with Lima. And we still see plenty of opportunity. You know, I shared that triangle of the industry, and there's thousands of companies in the base of the industry and, you know, new ones all the time. And so we certainly see plenty of opportunity to continue to do, you know, tuck-ins, technology acquisitions, adjacent acquisitions, and it's all really driven off a strategy. So any opportunities, you know, we've got a, you know, kind of powerful channel position in our, you know, large joint surgical business, and if there's ever great, you know, high growth offerings to bring in through that channel, you know, we're definitely always looking at those.
You know, as we've built out our foot and ankle business, you know, we did a handful of acquisitions to establish the business. And then really, from here forward, it's a make-buy, and you know, we can develop the rest of what we need to keep on being more and more successful in that business. But if there's something that you know, there's a better opportunity to acquire a technology that's either bringing to market or early in the market, you know, those would be opportunities we'll exploit on the foot and ankle front. We'll continue to look at you know, attractive globalization opportunities, maybe getting us deeper into some of the more attractive markets around the world. And on the P&R side, you know, we're focused on shaping, as we talked about in the slides.
You know, deals like the laser deal that we did a few years ago, that grows nicely double digits and has terrific gross margins, you know, those kinds of deals are still, you know, out there and attractive things that we can do on the P&R side, that can come in, shape the growth upwards, shape the, you know, the gross margins upwards, and also, you know, often can create more optionality, as well.
Great. In terms of the tax rate, how will Lima and the impact of Pillar Two impact in 2024 and beyond?
Yeah, we're doing the work now to make sure that we have a good handle on what the Lima acquisition does in terms of our ETR. I think what I've told people is we expect a little bit of a headwind based on Pillar Two and Lima, based on kind of where they are based in terms of where they're generating profits, to kind of put a little bit of headwind on our ETR. What I've been saying is about 100-200 basis points of impact is my current estimate.
Perfect. In terms of Recon, how sustainable is your execution in Recon and your ability to continue to take share in such a competitive market? Do you think you will need a robot?
Yeah, I think I tried to address that one head-on in the presentation, but I'll just reiterate a little bit of it. Yeah, I think what's terrific for us is we have about five or so share globally in this, which is, you know, 2% in hip and knee and, you know, kind of high single to 10 in shoulder. You know, when you look at the large joints part of this. So, you know, we are I think a well-respected force in the industry. I think if you look at our KOL teams, they can go toe-to-toe with, you know, with any teams in the industry, for sure, at least.
So, we have a strong position as a leading player in the industry now, but we have a share position that gives us plenty of room to run. So, we are confident that, you know, if you look at what we've done for 10 years in the U.S., if you look at the kind of innovation that still keeps coming through, and even kind of more opportunity to fill out the bag with surgeons, the new opportunities that come with enabling tech and the globalization, you know, we feel comfortable that there's, you know, plenty of opportunity. Look, quarter to quarter, things will be higher, they'll be lower. You know, not every quarter is going to be exactly the same.
But, you know, it even, you know, last year, the first two quarters were, you know, higher because it was going on in the market, and the Q3 was, you know, a little bit lower based on the comp. But then, you know, by the end of the year, you know, we're still well into the double digits with double digit in the quarters. So, you know, we feel comfortable we can continue to do this. You know, there's been a robot in knee for a while now, and a meaningful amount of knee procedures are done with a robot, multiple robots. But, you know, we're growing, you know, over 20%, you know, three quarters last year, with our great technologies and with enabling tech that we're starting to bring to the market, with ARVIS.
So we're very comfortable in our ability to continue to succeed, but we also realize we've got to keep investing and bringing great innovation through the pipeline.
Within P&R, you know, can you go into a little bit more detail about why P&R is important to Enovis? What are the areas that are more or less attractive in the portfolio?
Well, you know, I think what's great about P&R is that, you know, it's a consistent low- to mid-single-digit grower that has the opportunity to be a very strong cash flow business. You know, and you're starting to see that through this year, and it'll improve even more as we go forward. And so, you know, I think that that gives us the latitude to make the investments in Recon to keep growing that business aggressively as it scales. You know, I get questions about Recon businesses that kind of fizzled out. They're growing fast, and then they got to a certain size, and they couldn't do it anymore. And as I've asked about that and learned about it, in some cases, they just ran out of cash, right?
They're you know, because that's what they were doing, and there wasn't an ability to keep putting the right amount of cash in to keep fueling that growth. And to grow a Recon business fast, you got to you have to invest in it, and then eventually it'll scale, and it'll throw off plenty of cash. And P&R plays this very important role in our portfolio, as now it's a you know, good, healthy grower and a strong becoming stronger cash flow. Plays a very important role in our portfolio, first. Second, we've been shaping that business in a positive way, and there's more opportunities. So yeah, we you know, bracing business, you know, sports medicine bracing, you know, within the bracing business is a terrific business, right? Sports medicine is one of the higher growth parts of the orthopedic space.
And there's also neat digital opportunities in that space. The, you know, the reimbursed business that we have in clinics is fast-growing, high gross margin business. Within our RS business, our, you know, recovery sciences, you know, lasers are a fast-growing, high gross margin technology. And yeah, there's, you know, some more traditional products in there that we, you know, that are not growing as fast and have lower gross margins. And so, you know, we can keep shaping that portfolio to really solidify it as a mid-single digit grower over time and keep improving the margins and cash flow of it, has a great role to play.
And then finally, the continuum of care synergy opportunities that we have been exploited and continue to exploit, I think, are also a very important part of the role of that that business in our portfolio.
I'll just say, if you watch the game tonight, look for the DonJoy braces on both Michigan and Washington linemen.
Yeah. Almost every team in a bowl is wearing DonJoy braces, just to. So.
Great. And lastly, you know, as we're thinking about the long-range financial targets, how does Lima kind of change your view of the LRP? And how should investors be thinking about the major metrics of, you know, revenue, gross margin, EBITDA, and such?
Yeah, that's a good question. I think, as I shared, you know, we had been focused on getting to $2 billion of revenue by 2024, and with Lima, that, you know, we're kind of a year early on a pro forma basis on that. We've been focused on getting to consistent high single-digit organic growth by 2024, and we've had high single-digit organic growth the last couple of years. You know, but arguably, there's maybe a little market tailwind, maybe a little price tailwind. And so, you know, with Lima, that shapes our growth up some.
And we've had other things we've been doing, you know, as well, in terms of driving more innovation and things to keep, you know, to make sure that we can sustain that high single digit organic growth going forward, and Lima really helps to secure that. And then finally, as I shared, over 100 basis points of margin improvement, kind of out of the gate pro forma. It also takes our gross margins to the north side of 60%. We think a very important threshold at the company level. And there's, you know, we shared $40 million worth of cost synergy opportunity, at least to get after, that's gonna be helpful as well as we integrate the Lima business.
So I think Lima is helping us to kind of finish achieving our, you know, LRP, you know, objectives. And you know, going forward, we're focusing on continuing that high single digit organic growth, continue to climb up the margin curve, comfortable that we can get beyond 20% and you know, probably plenty of running room beyond that as well. You know, continuing to find attractive acquisitions that advance our strategy, shape our company in a positive way.
Awesome. I think that concludes today's presentation. Thank you so much.
Thank you, Caroline. Thanks, everybody, for coming.