DENTSPLY SIRONA (XRAY) The 44th Annual William Blair Growth Stock Conference summary

Company Overview and Market Position

• Operates in dental technology and solutions with $4B annual revenue and a $6B market cap, serving over 100 countries with a strong presence in Europe and the US.

• Four business segments: Essential Dental Solutions (37%), Connected Technology Solutions (30%), Ortho and Implants (26%), and Wellspect (7%).

• Holds top market positions in digital dentistry, imaging, aligners, endodontics, preventive, restorative dental solutions, and continence care.

• Over 45% of portfolio is digitally connected, with DS Core as a central cloud-based platform.

• Diversification includes non-dental Wellspect business, contributing to profitability and cash flow.

Strategic Initiatives and Transformation

• Undergoing a multi-year transformation with leadership changes, compliance, quality, and culture focus.

• Organizational realignment, SKU and network optimization, and ERP consolidation targeting $200M+ in annualized savings and a 500 bps EBITDA margin improvement by 2026.

• Investing $135M+ in ERP consolidation to SAP, targeting completion by end of 2026.

• Enhanced R&D focus, with 60% of spend on new product development, especially in digital and AI.

• Emphasizes a balanced capital allocation strategy, prioritizing reinvestment, M&A, dividend growth, and opportunistic share repurchases, with leverage targeted at or below 2.5x.

Growth Targets and Financial Outlook

• Targets 4%-6% organic growth CAGR, outpacing the $32B addressable market.

• Expects 500+ basis points EBITDA margin improvement by 2026, with at least 100bps expansion annually.

• Adjusted EPS goal of $3 by 2026, a 60%+ increase over three years.

• Free cash flow conversion expected to reach 100% as restructuring and ERP investments wind down.

• Capital allocation prioritizes growth investments, tuck-in acquisitions, and returning 75%+ of free cash flow to shareholders via buybacks and dividends.