Morning, everyone. Thank you for joining us for this session of the Leerink Partners Global Healthcare Conference. Mike Cherny, the healthcare tech distribution analyst here. It's my pleasure to have with us, Dan Scavilla. Pronounced it right, please?
You did.
Perfect. From Dentsply Sirona, along with Wade Moody, who heads up the IR function. I am pleased that Wade didn't decide to put any slides together, 'cause I got questions to keep us occupied for the next half hour.
All right.
Dan, we were talking a little bit before and one of the things I said I admired was your bluntness. You came in as CEO, and you were very direct with us about your thought process in the business and the focus on what you've termed a return to growth opportunity. How are you tracking yourself and for the organization the quarter-by-quarter progress? I mean, I know it's not quarter-by-quarter for us, week-by-week.
Mm-hmm.
I'm sure for you.
Mm-hmm.
What is, you know, in the investing community should we be looking for in terms of the most important mileposts on the progress that you wanna make sure you're hitting?
Yeah, Mike, great question. It's funny, I see it more day-by-day, right?
Mm-hmm.
As you kinda look at this with an urgency. You know, the reason for that too is just, we have to drive urgency with the company, with the mindset. Your question more on from the investor side looking in, little bit tougher because there is a lot of moving parts that you wouldn't necessarily see. I gotta think about coming up with some metrics maybe that we call out without repercussion, right? One of the first things is obviously when we talked about engaging and expanding dealers, and we announced that, and we've done that.
Yeah.
We'll continue to do that. I think that's one of the first triggers of theoretically as you get through that learning curve of the dealer reps, they build a portfolio, they start having a pipeline. You would think that would be a return to health in the U.S. for the CTS business, right? Now you gotta pivot over into implants, and that's really where the clinical ed and the rep ed and the strategy come into play that an investor may not see. What I might try and do is figure out how to metric out the amount of clinical education we're doing maybe year- on- year as a volume lift. You know, that one even if you spend heavy Q2, Q3, I think that's a lagging lift that you see maybe in the next quarter or the next year.
What I'll do is I'll announce where we're spending money and where we're investing. To me it's over the long term the true measure is the lift in sales, the slowdown of loss into a positive. I think that's the ultimate tell.
I'm glad you started with the dealer dynamic, 'cause I think that's an important thing that at times gets lost, is that you still have a really large portfolio.
Mm-hmm.
With a wide swath of products that's available and interesting both for the dealer side as well as your direct side. As you think about your engagement on the dealer front as part of the strategic push, what have been some of the puts and takes, and how have you gone about creating not just renewed contracts but actually new arrangements so that?
Yeah.
It's a win-win for both sides?
Right. Well, you know, this. The great news with that is just it seemed like all of us happened to be new at the same time. While you may have had a struggle in the past relationship wise, if you look at kinda the dealers throughout and me, most people have new leadership in there. One of the first things was just we'll shake hands and start fresh. You know, what are the couple of bugs from the past we have to quickly get behind us? How do you move forward? I think there's been a general agreement of there's a way for us to actually partner in a strong way that benefits the customers. Just a general agreement, which I'm not convinced was there in the past, is kinda step one.
The deal structures that we had in the past, and in particular with Patterson, that was really the one that was kind of being renewed, right, were complex. They just got complex over time. The real thing is just to make it simple for everybody. It really comes down to a benefit to actually have more volume, so the more we sell, the better we both do. I think that's one of the key points. Then, you know, dropship is a lot of questions I get from people.
Mm-hmm.
You know, that's just again just a simplicity that actually benefits both parties. You're not asking a dealer to tie up capital and cash in inventory and go. There's actually a benefit to us as well, is that we're not looking and trying to guess at lumpy orders where all of a sudden we have to be ready. If we know that there's a dropship and a steady cadence, we can actually manufacture at a steady rate. We don't have as much inventory. We actually have a better cash flow. Then a lot of the complexity that existed in the past was the debate as to when was a thing purchased, what was the deal, what was the price, what are you trying to do. All of that goes away.
Our simple focus together is how do you go sell something and place it? I think that in itself will actually create a lot of efficiency and a lot of benefit for both sides.
The dropship dynamic was something I know came up on the last earnings call. Like, maybe just walk us through a little bit more about, A, the most important short-term benefits to you and the dealer, and then, B, how you think about the financial trade-offs of how big dropship should be, if that makes sense?
Well, it's really more about a simplistic approach for both sides, right? Right now we're tracking dealer inventories and how much do they have, are they gonna sell it, are they gonna renew, do you need to incent them extra to get rid of some of those things. All of that goes away. Your real focus is how do we actually capture real estate and grow together. You know, we're not debating about something you may have purchased six months ago that's still hanging on and how do we move it. All of that goes away.
I think that's my point, is the simplicity is we'll track a pipeline, we'll share it together, we'll know how to build and level load inventory, and then we just simply have the ability to ship, and then we go support a customer and not worry about some time in between. Truth is dealers have carried sometimes between three to six months of inventory, and that can be really a disruptive factor. It's not a benefit to them as well.
Maybe shifting a bit, and I'm sure we'll come back to a lot of this dynamic, but to the offensive side, in particular on start with R&D.
Mm-hmm.
You've been fairly straightforward. Do you think the organization could use a heavier R&D lift to drive better product vitality? Where are the immediate excess incremental R&D dollars being portioned across the portfolio?
Yeah. Yeah, it's a couple things. I think we have, as a company, spread R&D among all of the verticals. I don't wanna say evenly, but not necessarily with a strategic focus and so everything we're doing right now is to create a sequencing and a focus to go deliver at certain point. I think everyone would agree DS Core is unique and, quite frankly, an opportunity to leverage. While we have the base there, now you would normally go through over many years and implement different verticals. How do we do endo, how do we do ortho, how do we do implants?
The initial tranche of accelerated spending will now allow us to bring all of that software at a faster pace at the same time, so we no longer have to do one after the other, we can do them all together. AI will be a big part of helping that as well and so really the initial thought is how can we realize the potential of DS Core at a faster pace than our current spending had allowed? That's number one. You know, number two is there some modernization within the EDS portfolio that we should do that keeps us competitive? Some funds are going into that way. Then really just the third approach here is not necessarily realized in 2026 but how to accelerate the potential of ortho both with robotically bent wires and also the aligners.
All of that was where the first tranche of incremental R&D money went.
AI and robots, I love it.
Yeah, right.
Yeah. I mean, but on the DS Core side, you know, I tend to agree with you. It's an untapped potential opportunity. Maybe can you talk to us, like, is penetration rate of dentists the right way to think about success on DS Core?
Mm.
Is it the enhancements to the workflow? How much they can access your overall solutions? Like how should we think about where DS Core drives the most value to your customer?
Yeah. Listen, in a simple way for me to understand it I'd put it this way. It's like we invented the smartphone and we have it there. Now we're coming back and we're designing all of the apps to get utility out of it, and I think that's the thing is you've got this core to build upon. There's a natural leverage with it. For example, if you are a dentist using multiple verticals, use DS Core, you don't have to be retrained each time as if you had three or four different companies. You just have one path that all works this way. There's an ease of use. There's a simplicity for the dentist. The real thing right now is to create more utility of, you know, we've got CEREC on Core. We made that move.
Now we've gotta go get implants and endo and ortho on DS Core and several others. Really all that is just making it a comprehensive solution all working together for the dentist. I feel like that coming in faster through the spending, and really right now while we don't face much competition would be a way to capture more real estate. To answer your question, I think it's really about the ability to transition into workflow and have more dentists using DS Core as their main workflow model.
We in the financial community think about, like, I constantly think about my model.
Mm.
Like my inputs to my model.
Mm.
I have an R&D line, an SG&A line. If you think about your business and how to make the business better.
Mm-hmm.
Obviously we both do both, but how do you think about the incremental spending on R&D against the targeted spending on the sales and infrastructure side to make sure that you're balancing your potential for new product launches, new workflow rollouts against making sure that you have the right market penetration for those rollouts?
Yeah, it's a great question and it's a constant battle, right? Certainly as you look at this you'd look at it in two chunks. Your commercial engine is really gonna be an immediate going into long-term, whereas the R&D is really about what can I get over the next three years? Really it's more about a tactical and strategic play, and you're saying, "How much of my funding do I wanna place into both?" The immediate need for us, obviously, is to stabilize sales and return U.S. to growth. That gets the lion's share of it. At the same time you need to feed them two to three years from now, and that's really where this other piece comes in.
For me as an old finance guy, I do it as a percent of sales, one of the main things. You know, what do I think regional-wise, how am I doing? There's efficiency measures. Am I actually using what I said I would use a good way? I would tell you if I had to default anywhere right now, it's stabilizing the business, returning to growth through commercial.
Mm.
Second is the innovation.
You gave me a perfect segue. You talked a bit about clinical education before relative-
Mm-hmm.
... to implants. You've also made previous investments or previous discussions about investments in the sales force, in other pieces of the commercial infrastructure. Dentsply Sirona has done this in the past. How are you doing it differently?
Yeah, it's a good question. You know, I think first off it's really about just being transparent to everybody throughout the chain. Where are we? How did we get here? What are we gonna go do differently? I think it's making bolder decisions about these moves and actually clearly articulating where are we going. I think in the past there were cuts done to make profitability. I'm re-engineering a P&L to drive sustained growth, and I'm pointing where it will go to. The capital allocation model, the cancellation of the dividends is another example of that. You know, even the acceleration of R&D. I think the difference is there's a holistic look at the health of the business, short, long-term business itself, the financial markets all comprehensively that I don't feel was done in the past.
As you think about it, and again because you proactively brought up implants, it seems like a fairly direct opportunity. Maybe similar to some of the R&D dynamics, how are you structuring the priority of investments?
Mm-hmm.
... in the commercial infrastructure knowing well here that for some of your products the investments are investments alongside your dealers.
It's a great question. I would tell you right now we're mid-stride in developing our implant strategy. I think one of the faster things is reestablishing dealers, as you mentioned, and getting capital there. The very next move for us is the creation of a CEO advisory board with a lot of dentists.
Yeah.
Where we're gonna talk about strategy, evaluate the portfolio, decide how to use clinical data to go drive that, and as you said, you know, an enhancement in clinical education to create awareness, peer-on-peer training, which is key, and there's nothing more powerful than having dentists train dentists with that. At the same time, dentists training our reps. I feel like we underinvested in our rep education. We almost have to bring in a med dev model about how you do that through several, you know, weeks to get these folks stronger. Then there's ultimately a pivot, Mike, from selling a widget into actually the work stream, which comes into DS Core.
We have to train our reps to think through the dentist's eyes what is the process flow from imaging through to follow-up, how can they be trained to understand all of that impact, and how do they have enough proficiency to stratify our portfolio and say, "Here's the solution for you." The thing that amazes me most is we literally have the strongest implant offerings and have not capitalized on that, and that's one of the biggest things we have to turn around this year and next year as we go deeper.
From a competitive perspective, what does that look like in terms of the capitalization opportunities? You know, how do you or how much of it is products versus product awareness versus product education? 'Cause-
Mm-hmm.
... all three of those things take on.
Yeah.
... different measures.
I would tell you we do not have a product gap of note. We have a communication and an execution challenge that I think is there. I mean, our Astra product is arguably the best in the industry with the fastest healing, the lowest infection rates over 30+ years, and we don't flex that muscle. Our MIS portfolio is amazing, and yet we have it out there and it sort of goes on its own. We have to turn it into proactive, honestly, weapons to penetrate the market as opposed to just letting them roll, and I think that's the biggest change is assigning owners, creating education and driving these things meaningfully, I think, can make a difference.
Thinking broadly about the market, you're the third dental company we've had so far, and the theme has been fairly similar to what we saw in the earnings calls, which is signs of stability.
Mm-hmm.
Like, how are you thinking about relative to your key product areas, especially on the equipment side, both imaging, surgery, et cetera, like, are you where are the biggest sources of stability? Where are potential sources of green shoots? Where are areas you're still concerned about relative to end market demand?
Yeah. Listen, I would agree with everyone that you probably spoke to that the market appears stable, even slightly improving. I would come back to say that our challenges are not related to a market, whether it's up or down. The fact that we're negative doesn't matter where the market is. We have to change that. It's really more we currently have to go fix ourselves and reestablish with customers. What we're trying to do is not dependent on the market up or down. Certainly it helps, but I don't think I can lean on it and say we'll recover because the market is up, therefore we're up. That would be a dangerous spot for me right now. Maybe that's different in two years. We can have that conversation. Right now, it's a great market to build in.
There's nothing working against us. You know, some slight noise with the current war that's going on, but nothing that derails you. It's really about focus and execution internally for us.
Quick sidebar just because you mentioned that. Anything we should be thinking about relative to manufacturing locations in the area? Hopefully what you have, everyone's okay, most importantly.
Yeah. Thanks for asking. They are okay. Of course we have two plants that have missiles literally flying over them in Israel, right? You know, we're watching. We have all of our employees safe. We're keeping them out of harm's way with that. While there could be some disruption, which we'll see over time, we currently have enough inventory in the market that I don't think there's anything to signal right now. A prolonged war could always change that course.
Hopefully we don't have that for many reasons.
Amen.
... appreciate that. Just, check the box on the financial side. Turn to DSOs.
Mm-hmm.
You come from outside the dental world, but you come from a world where there's plenty of other-
Mm-hmm.
... broader groups. How, looking still within your first year in the tenure, how are you viewing the strategic nature of your dental supplies push into DSOs, DSO expansion, and where you think your strongest versus opportunities for improvement?
Yeah. It's one of those ones. Again, I'm gonna go back to say sequencing. It's very important for us. You know, I was kinda going into capital, into implants and ortho, restructuring U.S. sales force. We have all of that underway. Now, as you know, when we mentioned we're moving into clin ed, rep ed type of approaches. With that, now you start pulling into some DSOs. How do we actually work on programs not only to train our reps, but actually use a focused clin ed through the DSOs. So that entryway in is gonna allow us to actually recruit a new structure, a team who will focus on DSOs to penetrate. I believe our strength is the holistic portfolio we have. We can sit down with them and offer every single thing as one company.
No one else can really do it to that extent. Even the dealers are piecemeal among what they offer. Our ability to leverage with the DSOs can be very beneficial. I'm a fan of a de novo approach within the suites themselves, filling it out. I would tell you it's coming. It's not where it is right now, but within the next six months, us building a DSO team and strategy and penetrating that is something that's on my list.
Is that the sequence that we should be focused on? You know, and not that you have strong, obviously, DSO representation now, but from a strategic perspective, put the team on the field and then give the team the playbook to go out and win new business?
It is. Mike, it just comes down to this, right? We're in a turnaround, and so I evaluate some people and if they're capable of moving along, we fuel them and go. If they're not, we remove them and hire. Currently with that role, I'm in a remove and hire situation. I think it'd be more towards the second half of the year.
Okay. Turning a bit, you know, a different way back to innovation, but you touched on AI briefly.
Mm-hmm.
You know, AI obviously, I think I'm asking an AI question every fireside here, so clearly time for it, but how do you strategically view AI as a outward facing tool versus AI as a internal efficiency tool?
Yeah. You know, it's interesting too. I always say you know, the truth is none of us really know, right? Let's be honest. It's moving so fast, and our understanding isn't quite there. You know, there's something there to not only embrace and push, but also be wary of. I would tell you just by human nature I don't wanna be the first one out and the most leading with this, in something that changes so rapidly. I wanna be a follower, maybe a fast follower, but eyes on it. You broke it down into two important areas. On the external facing, we've already started using AI, and of course it enhances every day with the ability to take an image, diagnose it, recommend treatments, and to be active part of the planning of that with the dentist.
We'll keep going down that path. You know, customer service and customer experience is something we need to improve and improve rapidly. We've begun playing with bots online to significantly reduce call times, and therefore response times to our customers. There's little dabbles like that that we're getting into. Not little, but actually moves that we're doing that way. Internally, the R&D team is actually looking at AI written software, and they're not there yet, but that capability in the next 12 months is highly likely, which can accelerate software development and even product designs. Part of the funding that I failed to mention before is also down that path.
I think in-house when we continue to rebuild the support departments and the P&L and the structures, I think AI tools for, you know, some of the basic finance, I mean AR, AP type of things like that can be big. You know, the analytics and the approach, whether it be in legal or other areas, I think there's applications that will allow us to move fast consistently with less bodies that can free up more money for us to actually place into commercial for market penetration.
Got it. Yes, I agree with you. Things are moving fast. We've, you know, honed in a lot on stuff around the North American market and I mean, we touched on implants a bit, but how do you feel about the global presence in particular on implants, which I know obviously you have a very global reach, and if you think about ex-U.S.
Mm-hmm.
Where do you, as you settle into the CEO role still within your first year of the role, view you have the best product penetration opportunities based on branding and local markets?
Yeah, I would say EMEA is one of our strongest markets, and when you remove some of the delisting of SKUs or products and you tease through that noise, you would actually see that several of the products are growing significantly above market with penetration. I would say that EMEA as a region is one of our strongest for implants. Asia Pac has the most potential and, you know, again, we're evaluating China and all of the changes in China to understand what our response is there. Outside of that in the other areas, the potential for implants is amazing. I would say, you know, EMEA is strongest with U.S. having high potential longer term growth out of Asia Pac through the implant business.
Yeah. Obviously the Dentsply Sirona organization has a, you know, strong roots in Germany and whatnot. As you think about across EMEA, is it how do you view the opportunity on developed versus more developing-
Mm.
Countries in terms of penetration potential?
Yeah, certainly the developing will be the higher rate of penetration over time just given the small scale and where they can get up to. At the same time and kinda where you're going, but you also need to preserve and protect the business you have. You can't lose it in the developed areas. You gotta let that grow even if it's at a slower rate to be the foundation as you dig deeper into other market penetrations.
You know, talked about implants. We talked about. You touched on some of the imaging and CEREC. Equipment and consumables are the nuts and bolts of the dental market, I feel like, doesn't get talked about a ton.
Mm-hmm.
How do you view the health of your basic equipment and consumables portfolio right now?
Yeah, very healthy. Actually, you know, I think the foundation we build from is our EDS business, which is where we have most share and it's very strong business for us and, it kinda goes. I think that platform is doing well, can do better again through just the basics of clin ed and rep ed type things for sure. But I'm pretty happy with it. Again, you know, if I look at our products, I'm gonna go back and say I really feel that we don't have major gaps. I kinda point the finger and say it's how we're executing that has to improve. That does include EDS. Again, I see opportunities to get even stronger there.
What are your thought process, feelings about using promotional opportunities to try and reestablish business? There's obviously a trade-off of value and volume versus price.
Mm-hmm.
How do you philosophically view the ability to partner promotionally with dealers and vendors?
Yeah. Listen, I'm very favorable towards that. We go back, you know, past life even in spine with Globus Medical. You know, the ability to actually place capital and earn it out through volume is there. The potential is here more than anything else I think in dental as well. I'm game to come up with plans, you know, that allow us to actually consider is there a capital and a pull-through bundle that makes sense for both parties. Again, with that there has to be volume commitments in order to be price relief. It can't just be one. You know, we're in it to grow as a total. Listen, the ultimate focus for me is sustained profitable growth, but ultimately that throws off ever strengthening cash flow. I wanna become more of a cash flow based company over time.
You know, again, I don't think we're there in the next 12-24, but I think going forward having a strong cash flow and investing that wisely could be really a lift for the company.
Thinking across the rest of the product portfolio, intraoral scanners have been through a multi-year cycle of kind of market establishment, pricing differentiation, stratification. You got Primescan 2, you got Primescan Connect. Like where do you see the best strategic pushes on the Primescan family right now against what's been a varying level of price points.
Mm-hmm.
Competitively.
Yeah, probably, I would think in the future, you know, Primescan 3, which is going to be a different design and coming out, will probably be one of the things we'll wanna use and leverage as a way to create penetration. I think right now we'll stay the course with what we have. It's not lack of creativity. It's just there are different items that we need to do and focus on right now. I think coming out with a new strategy with the imaging isn't quite there.
Yeah.
Again, you know, I would say 2027 can be a very different story, depending on how we progress.
Primescan 2, I think a lot of the dynamics was ease of use.
Mm-hmm.
you know, the handheld perspective, the portability. Is Primescan 3, I don't wanna get too far ahead of itself, but maybe the advancement of the family more about the hardware or the software or both?
Both. Yeah. It's easy to say because it doesn't exist, Mike. It's ideas right now. One would think that smaller, faster, cheaper would be really where you wanna get to. To me it's about iterative learning and making this move into a simpler package that can help us expand further.
I'll get a sketch pad after. We can start to draw out.
Yeah, we can figure it out.
Some pictures.
Yeah.
Let's talk about the orthodontic portfolio. I mean, you highlighted the rollout, the roll-off of Byte into next year. Like, how do you feel that SureSmile, now that you're a professional-only orthodontic platform, is positioned in the market right now, especially against the potential long-term of transitioning from traditionally GP into the orthodontic market?
Yeah, and I think you kind of answered it right there. We have to reestablish a stronger presence in ortho. Having exited that out for GPs is something that I wanna change. The biggest thing is with SureSmile, again, it's one of those assets that we haven't flexed the muscle along with clinical data, with outcomes, with materials that are really strong and very capable of having its fair share of market. The fact that it's a comprehensive package that is beyond aligners into robotically bent wires and creates a solution for orthodontists that can either be combined brackets and wires along with aligners or just aligners or one or the other. The biggest thing for us is modernizing our platform. We have an out-of-date software that wasn't invested in, and we need to roll that into core.
Part of the acceleration of R&D this year is to bring that further along, to make that simpler to use, modernize it out to today's standards, and allow us to go out and compete against the, you know, Invisalign or Angel Aligners and look at it that way. I really feel that once we have that done and we go through the trainings that we've mentioned, we have the ability to capture share there. Again, I'm not declaring that suddenly we're number one in the market. That's not it. There's enough space to get a decent amount of, honestly, free cash flow to use to generate for the rest of the business.
When you win share on SureSmile, what is the typical profile of a dentist that you're bringing on board? Is it somebody who's historically been only brackets and wires? Is it somebody looking for a replacement product? Is it somebody who is a hardcore DS Core customer already? Like, how should we think about where you've been successful?
Yeah. I think where we've been successful is, first off, people who are willing to tolerate our software because it just really does need to be modernized. They also understand that it gives you more planning options and therefore less special one-off items where some of the market leaders have to go to. It's a comprehensive solution that can just become a natural part of the planning for them that works well. The outcomes which we haven't discussed yet are higher or better than others, and we have to get that solidified and go share that out. It's usually someone willing to tolerate, "It's a little bit tougher to use the software, but it's better for my patients." I think that's really where we see mostly conversion versus a hardcore dental supply person.
How do you get that data out? Is it clinical papers? Is it
It's clinical papers.
Okay.
It's clinical education.
Yeah.
Right? Hence the move for that. You know, when I talk about clin ed, while certainly we'll be focused on implants, ortho is right up there. And I think that's one of the needs is we just have to share what we have. We haven't done the best job doing that.
You've been fairly transparent about the Byte financial impact. Is there any qualitative impact that you see in the market? Obviously you're a new leader. Like, this.
Yeah.
Was not a deal that you did, and so now it's kinda cleaning up the challenges from the past. Has there been anything in the market customer-wise or patient-wise that is worrisome to you, or is it just?
No. No, not really. Listen, I just think that it was something that wasn't the right move, that overall, you know, pulling it was the right thing to do. Getting all of that underway and done is there. I think by the end of this quarter, all of the treatments that were in progress are planned to stop, and then that gets into the history books. I don't know if it did anything to damage us with it. I think it created the rift between ortho and Dentsply Sirona, and that's really what we're trying to rebuild. You know, that one will take a couple of years. That's not just gonna be a phone call, a new guy, and suddenly they're on, right? We have to rebuild that trust and go.
I think it created a situation that's impacted us, but it's something new we can overcome.
As we wrap this up, and we've talked a lot about the investments you're making, a lot of blocking and tackling, you know, the Band-Aid being pulled on the dividend.
Mm-hmm.
I think everyone understands it. How are you thinking about the final leg of organizational priorities on making sure 'Cause I hear you as a cashflow guy.
Yeah.
Like, how do you make sure that you get the cash flow level to where you want it, knowing that you're spending to grow right now?
Listen, I'm gonna build on that 'cause there's really two things. One's a message I do wanna throw out there. We are implementing our investment plan, whether it be the 50% increase in clinical education or investing in reps, as we talked about, or even double-digit growth in R&D, and that's occurring right now.
Yeah.
We've begun the restructuring really in March, and over the next four months that's also going to occur. One thing I do wanna throw out, Mike, to you and to counterparts in the investment community is as I look at that and I look at the timing of that, while we don't give quarterly guidance, we will have EPS pressures in Q1, Q2, as you do the investments and not yielding the results of that. I think you have the second half lift where that restructuring comes through. Just something for everyone to keep in mind is we're gonna spend for the long-term growth, not a quarterly flash. We have pressure up front, relief coming, which has started in March, probably finish up and then see it in the second half of the year.
I do think there's a balance of that has to be factored into the way we're looking through this year. 'Cause I'm gonna invest in the right things and take the right bumps up front for long-term gain, and that's where we are now. I think that that's probably the biggest thing I wanna throw out there is, you know, that. At the same time as we grow and we de-leverage, we'll get ourselves healthier on the balance sheet, and then I wanna remove shares so that we have a stronger EPS growth versus top line. Then that in itself, as we use cash flow, can be used to create, you know, what I think is a value generation for shareholders.
All seems logical to me.
Thanks.
Dan, thank you so much for your time. Really appreciate it.
Good seeing you again, Mike. Thank you.
Yes.
Thanks, everyone.