Good day, ladies and gentlemen and welcome to the Quarter One 2015 Teleflex Incorporated Earnings Conference Call. My name is Emma, and I will be your operator for today. At this time, all participants are in listen-only mode. We will conduct a question-and-answer session towards the end of this conference. [Operator Instructions] As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to Mr. Jake Elguicze, who is Treasurer and Vice President of Investor Relations. Please proceed, sir.

Thank you and good morning, everyone, and welcome to the Teleflex Incorporated first quarter 2015 earnings conference call. The press release and slides to accompany this call are available on our website at www.teleflex.com. As a reminder, this call will be available on our website and a replay will be available by dialing 888-286-8010, or for international calls, 617-801-6888, pass code 72082025. Participating on today’s call are Benson Smith, Chairman, President and Chief Executive Officer; Thomas Powell, Executive Vice President and Chief Financial Officer; and our newly appointed Executive Vice President and Chief Operating Officer, Liam Kelly. Benson, Liam, and Tom will make some brief prepared remarks and then we’ll open up the call to Q&A. Before we begin, I’d like to remind you that some of the matters discussed in the conference call will contain forward-looking statements regarding future events as outlined in our slides. We wish to caution you that such statements are, in fact, forward-looking in nature and are subject to risks and uncertainties, and actual events or results may differ materially. The factors that could cause actual results or events to differ materially include, but are not limited to, factors made in our press release today, as well as our filing with the SEC including our Form 10-K, which can be accessed on our website. I would like to point out that the format for this morning’s call will be slightly different than our past earnings conference calls. Benson will begin with a high-level overview of our quarterly results and provide an update on some key strategic initiatives, including our manufacturing footprint consolidation program. Who’ll then turn the call over to our newly appointed Chief Operating Officer, Liam Kelly. Liam, who has been in executive roles at Teleflex since 2009, will review our first quarter product line and geographic revenue results, provide updates with regards to recent GPO and IBN developments, new product introductions and regulatory approvals and highlight two small acquisitions that we completed. Following Liam, will be our Chief Financial Officer, Tom Powell. Tom will review our first quarter financial results in more detail and also provide an update regarding our financial guidance for 2015. And finally, we will open up the call to Q&A. With that I’d like to now turn the call over to Benson.

Thanks, Jake and good morning, everyone. Let me start by saying that we are very pleased with our overall first quarter results and are off to a strong start to the year. From an operational standpoint, our execution against key priorities this quarter was excellent. And for the third quarter in a row, we continue to see strengthening revenue growth in North America. And while FX continues to be a challenge, we’ve been successfully mitigating impact on our adjusted EPS line. In light of the substantial volatility and currency, we have been encouraged by our investors to be transparent as to how FX is affecting us on our important financial metrics, and to provide easy visibility into our underlying business performance, as well as highlighting, the impact of currency having on those results. During the course of our presentation, we’ll therefore be commenting on our results with and without the effects of currency throughout the P&L. First quarter 2015 revenue totaled $429.4 million, which represents an increase of 5.2% on a constant currency basis. Action the impact of currency or as reported revenue would have totaled $461 million. Additionally, we had one less shipping day in the first quarter of 2015 as compared with the prior-year quarter. If you were to adjust for the shipping day impact, our constant currency revenue growth would have been approximately 6.2%. And while Liam will discuss in greater detail our revenue breakdown by business segments, I want to point out that our constant currency revenue growth in North America was 6.7%, adding in for the shipping day we lost, our constant currency revenue growth in North America would have been over 8% and there is no impact from distributed to direct conversion on those numbers and a very modest impact from acquisitions. As such,…

Thank you, Benson, and good morning, everyone. It is my pleasure to be speaking with you this morning. Like Benson, I too am encouraged by Teleflex’s first quarter results, as well as the multi-year opportunity that lies ahead of us to drive consistent, above-market constant currency revenue growth. We have the opportunity to leverage our business to expect significant operating margin expansion and adjusted earnings per share. With that said, let’s turn to a more detailed review of our first quarter product and geographic revenue results. For the consolidated company, first quarter 2015 constant currency revenue grew 5.2%. This revenue growth was broad-based both in terms of product lines and geographic regions. Sales volumes improved and contributed approximately 256 basis points of revenue growth. This growth was driven by core growth of 124 basis points and Vidacare growth of 132 basis points. And while it may appear at [indiscernible] plants as a percentage of revenue growth attributed to core product volume may have been lower than what we expected when we provided our initial financial outlook for 2015, it is important to understand that the company had one less shipping day in the first quarter of 2015 as compared to the first quarter of 2014. This impacted our constant currency revenue growth by approximately 1% and particularly impacted the sales growth we attributed to core products. If you were to normalize our first quarter results for the impact of one less shipping day, the revenue growth stemming from core products would have been above the upper end of our original full-year revenue growth guidance expectations. Turning to Vidacare. During the first quarter, the performance of these product lines exceeded our expectations and contributed approximately 132 basis points towards our overall revenue growth rates. From a regional perspective, Vidacare growth was…

Thanks, Liam and good morning, everyone. Given Liam’s discussion of the company’s revenue growth drivers, I will begin my prepared remarks at a gross profit line. For the first quarter, adjusted gross profit was $224.8 million versus $221.2 million in the prior year quarter. Adjusted gross margin increased 190 basis points to 52.3%. The increase in adjusted gross margin was primarily due to improvements in operational efficiency, distributor conversions, modest level of net product pricing and favorable product mix, including robust sales of Vidacare. These improvements were partially offset by the unfavorable impact of foreign currency exchange rates that reduced gross margin by approximately 30 basis points. For the first quarter, adjusted operating profit was $87.8 million, an increase of 6.2% versus the prior year quarter. Adjusted operating margin increased 160 basis points to 20.5% with the increase being largely attributed to the improvement in gross margin. During the quarter, we held adjusted SG&A and R&D spending to below 2014 levels. However, this spending level did not materialize into additional operating margin leverage, as further gains were inhibited by the fact that foreign currency impacts also reduced reported revenue growth to minus 2.1%. Moving next to our adjusted tax rate. For the first quarter of 2015, the adjusted tax rate was 22.3%, a reduction of 220 basis points as compared to the prior year period. The year-over-year reduction is primarily due to tax planning actions that were executed mid-last year. On the bottom line first quarter adjusted earnings per share totaled $1.30 or an increase of 6.6%. For the quarter we estimate that foreign currency reduced adjusted earnings per share by $0.09. If we exclude the currency impact earnings per share growth would have been 13.9%. Turning to the balance sheet in cash flow highlights. During the quarter, cash provided…

[Operator Instructions] First question comes from the line of Larry Keusch of Raymond James. Please proceed.

Hi, good morning everyone.

Good morning, Larry.

Good morning, Larry.

Two questions for you guys, first Benson maybe you can expand a little bit on what you’re seeing relative to the comments that have been made on the firming of the environment in North America. I’m just curious, so where you’re seeing the strength, sort of what product lines seem to be experiencing the improvements, et cetera?

So our – we certainly saw a considerable strength in our surgical business in North America that was up 9%. We did not see the same kind of strength in the respiratory therapy business for example, which was very low in the single digits, vascular was up 9.1% I think also. So it’s targeted improvement. I think our estimate would be it has more to do with increasing levels of acuity as opposed to just outright admissions given the strength in some of those particular product lines, but not in respiratory therapy which is much more associated with general admissions and that’s the general sense we’re getting from the providers that we talk to.

Okay, perfect. And then Tom for you, just, I want to just come back to the gross margin outlook for the end of the year and the 55% exiting. First I want to just make sure I understand is the comment around the potential to miss that solely due to FX?

Well, the way we look at it Larry is that we have a number of planned actions that are against to that target. And as we discussed in the prepared remarks, we’re executing very well against that. And we had a good first quarter performance. So as we look to the fourth quarter, we are still tracking towards those plans that we put in place and we feel good about those. We are raising the spectra that FX continues to be something that’s a bit uncertain and unpredictable and it will have a margin impact for us. And so we’re just raising that as a potential issue now. From an operating standpoint, we feel good about how we’re moving against that plan and look forward to executing the rest of the initiatives as the year progresses.

There is certainly operational items yet to be achieved and as Tom said, where we feel quite good about where we are in the process, it’s just really hard right now Larry to predict what the dollar-euro exchange rate is going to be in the fourth quarter it could be parity, it could be $1.5 and there is an impact on what our fourth quarter gross margin is going to be that is one of those items that’s largely out of our control.

There are some other issues with mix that could have some balance, we have mentioned the fact that the single biggest competitor in the chest drainage area has some regulatory issues, we are doing our best to provide an alternative product to our customers here in the U.S. and actually we’re going to be selling every single one of those that we can make from a responsibility standpoint to our customers, it’s going to be good for revenue, it’s going to be good for EPS, it’s one of our lower gross margin products, so it can have a small drag on our gross margins. But I think from an operational standpoint of view, we’re quite satisfied that we’re right on track to where we need to be.

Okay. And then last one on this, and then I’ll drop. You guys did mention that if you were to miss that target, it would be a small miss, but would you care to put some brackets around that just to help us?

Yeah, I think the best thing we can do Larry is, is on a quarter-by-quarter basis, keep you up – keep you informed in terms of how we’re doing operationally, what our current currency expectations are where at $1.08, we expect we’re going to hit that 55% number.

Okay, great. Thanks very much.

The next question comes from the line of David Lewis of Morgan Stanley. Please proceed.

Hi, good morning, this is actually, John Demchak in for David.

Good morning, John.

Good morning, John.

So first off, I wanted to say congratulations to Liam on his new role. And I had a kind of a question about that, because I think that a lot of investors may look. This is kind of a start of a possible leadership transition. So Benson, I was wondering if you can maybe comment on this and if there is any truth to that thought. And then also like why is now the right time to be adding the COO role for the company?

Yeah, so. I appreciate the question despite my useful appearance and balance energy. I do get asked about my potential retirement plans from time-to-time. I just think it’s important for every company to have a some kind of a transition plan. It takes a while to get familiar with all the issues that the CEO might have to grab away. So it’s not an overnight plan at all. We’re – I would say I’m quite pleased with the general level of promotable candidates we have within our senior leadership team. And from a structure standpoint of view, really for the last couple of years, I’ve been doing the CEO role and a good part of the Chief Operating Officer role. So it’s I think we’ve reached a point in our organization development, where quite frankly we need some more attention on [indiscernible] services. This is certainly mainly factored at or move that we’re trying to make here. But I’m quite Liam Kelly asked me when I’m leaving also and I won’t give him a definite timetable.

Thank you for that. And just a quick follow up for Tom on EPS guidance holding constant. So it looks like organic trends in the business may actually be going a little better as given the reaffirmed guidance following a couple of headwinds from I guess share dilution and also additional FX pressure, which I guess combined seem to total somewhere about – sorry seem to total somewhere about $0.10. And I was I guess a little less clear on the offset, some of that clearly looks like it’s coming from better Vidacare performance, I think that you guys said that it was over a 100 basis points to revenue growth versus about 50 basis points that were estimated for the year, I think originally. So I was just wondering if you could may be cross walk me to kind of how EPS state constant given those headwinds.

Sure, sure. Well, we – just to kind of make sure that we clarify the headwinds as we updated our guidance on foreign exchange and share dilution. We come up with $0.12 more I guess headwinds then we initially had expected $0.05 from foreign exchange, $0.07 from share dilution. And then we look to what’s going to offset that we have a number of factors that we’re looking at. One is, first of all, Q1 came in a little bit stronger on our earnings and we had expected so there is a couple of pennies there. We also have added couple of smaller acquisitions, which collectively contribute a little bit less than $0.05. And then we also have the refinancing debt, which contributes $0.08 to $0.10 for the year. So collectively those benefits are in the $0.15 perhaps $0.17 range offsetting the $0.12 of additional headwinds. So we feel pretty good that we’re at $0.03 to $0.05 on the positive side from where we started given the offsets.

Thank you very much.

The next question comes from the line of Matt Taylor of Barclays. Please proceed.

Hi guys. This is Yong Lee for Matt Taylor. Thanks for taking our questions. I guess, just to start off, I’m wondering if you can just provide some additional details on the weakness in Asia more specifically in China and what are you seeing in the market that gives you confidence that volumes can prove in the back half of the year?

So towards the – well, last year we also saw some weakness in China, that was largely due to the sale of our intra-aortic balloon pumps which is a capital equipment of sale. We are seeing that recover. And so that’s certainly a move in the positive direction. During the first quarter of every year, we go through a process where we essentially do renegotiations with actually relatively a large number of distributors and that process is a little slower than what we thought. So we are – we did not see the order pattern from those distributors come in the first quarter, our belief is that that is simply a timing issue and as those agreements are being executed, we’re getting filling orders. So I’m not sure that’s the case with other peoples experience in China right now. In our case, it’s somewhat idiosyncratic situation and we think we’ve got pretty darn good insight into it. And therefore, have a – I would say a pretty good level of confidence that we’re going to see that rebound.

All right. Great. And also you made two acquisitions in the quarter. Can you just remind us about your capital allocation priorities and also how is the M&A pipeline working for you?

So we continued to be – we continued to remain committed to our essential acquisition strategy which includes we call them Vidacare LMA size acquisitions late-stage technology acquisitions, dealer direct acquisitions, and I would add to that these [indiscernible] acquisition is really is an example of a vertical integration opportunity, where we had been buying a product from them and it is more of a gross margin enhancement opportunity than necessarily a direct revenue enhancement. We continue to remain committed to that and believe that under the current circumstances that’s where the priority is. I would say just turning to our attention to the Vidacare LMA side of the acquisition, we continue to believe that there is a good pipeline availability of companies out there for us. Bear in mind we have the financial flexibility to do one of these about every 18 months. So there doesn’t need to be – there doesn’t need to be a large number of them out there for us to be able to meet our goal. That being said, we’re pretty darn picky about what makes a good acquisition for us. And our general sense is we get rewarded to doing acquisitions as we get rewarded to doing really good acquisitions. So we are – we continue to maintain a – I would say a lot of discipline around what we’re willing to buy.

Okay. Great. Thank you.

The next question comes from the line of Dave Turkaly of JMP Securities. Please proceed.

Thanks. And just a follow-up on the comments the North American strength. I know you had some issues last year. I was just curious form a head count level of the sales forces particularly in Vascular and Surgical, did they increase? And then this new restructuring initiatives, I think you talked about some termination benefits and maybe some productivity increases. And I was just wondering if you could give us an example of exactly what you’re doing to kind of increase the productivity if it is on loaded head count.

So we – there were some modest head count increases in our Vascular business as a result of the Vidacare acquisition. Surgery, really has remained largely constant at this point, although it’s a targeted area for some modest expansion, as we roll out the Percuvance product line. The adjustments that we’ve made in terms of cost control really come more at the expense that eliminating some smaller divisional and managerial head count versus sales head count. So we haven’t really change the head count we’ve just reapportioned it. And we think that is actually better to have a smaller sales force exclusively focusing in on respiratory the therapy business that’s a very GPO oriented IDN oriented sale. And have that remaining sales force in the anesthesia product lines really just focused on – on their products and their co-point. And so far I think the responsive has been quite favorable. So we have not other than the – other than small addition that came from Vidacare changed our head count. I think David it’s as much due to having kind of a more exciting product lines to sell. And we’re – that helps sales commissions, that helps attract a better group accounted sales people to the organization and all those things are paying off. And I would say for the last several years, we’ve been focusing a lot on sales force effecting this.

Great. And then on the distributed direct opportunities, you’ve done several. I was just wondering if you could just give us a ballpark figure of how many sort of sizable ones are out there for you, there are still 10 of these are out there are there just ballpark, how many of these things could we possible see kind of come internal over the next couple of years?

And so it’s probably, so they’re are very different size and very different numbers. I think the best answer I can give to that question. We’ve generated around 100 basis points of improvement in terms of our numbers and over the past couple of years as an average. And we certainly have a free clear line of site over the next couple of years. And I think what you’ve seen in the past couple of years as an average is what you’re going to see over the next couple of years.

Thanks a lot.

The next question comes from the line of Matt Mishan of KeyBanc. Please proceed.

Great. Thanks for taking my question.

Hi, good morning.

I’m not sure – yeah I’m not sure if I missed it or not, what was surgical Mini-Lap?

Mini-Lap, was about 30 basis points of surgery. So with the very small contributions to their...

700,000.

700,000, so 30 basis points of that 9% increase.

All right, great. And on Europe, it came in at like 2.2%, do you think you had some pull-forward in the fourth quarter from this quarter?

No.

Okay. And lastly, on Percuvance, and I don’t want to steal anyone’s thunders from the Analyst Day. But have you guys thought about what this product can do not necessarily this year, but in 2016, 2017 as far as revenue growth goes?

So the short answer is yes, we thought about it a lot, there is a wide range in terms of what the performance of this product line can be. Right now, we’re in fairly intensive clinical used opportunities in leading institutions around the United States and in Europe and getting an understanding from the early highly experienced laparoscopic surgeons where they see this most applicable and to try and understand what percentage of the traditional laparoscopic procedure rate it’s going to be able to I think be able to encroach into. At this point, the feedback we’re getting from the physicians that are using this is quite positive. And again, we’ll have more information to be able to share with you at the Analyst Day. We’ll have one of the leading surgeons in the U.S. that’s working with us on this to give you his view points.

All right. Thank you, Benson.

The next question comes from the line of Jason Wittes of Brean. Please proceed.

Hi. Thanks for taking the question. Wanted to focus a little bit more on Vidacare. First off, is it helping with pull through with your PICC and CVC business as well? And as part of that question, could you just give us the growth of vascular ex-Vidacare?

Yeah. So just answering the question about Vidacare as a pull through item. So I think the short answer is yes, I mean it’s an exciting product to sell. We made really good inroads into the hospital segment in the first quarter. The growth within that unit was right at 31%. It was one of the key reasons that we purchased Vidacare was we felt we could do a really good job with that in hospital customer and beyond the emergency room in the hospital getting right down into their crash car situation. I don’t know that we have a completely exact number. But I would say it’s somewhere between 6.5% and 7% of Vascular growth without Vidacare. So it’s still pretty strong growth even with that accepted. But I will tell you that this growth isn’t happening by accident, it’s taking sales time and sales energy to be able to move it into that – into that segment. And every time we sell a Vidacare unit, it’s the highest gross margin product we have. So we’re certainly not discouraging them from spending a lot of time on it.

Yeah, Jason. Benson is right. It was – for the first quarter Vascular North America revenue grew 6.9% excluding Vidacare sales.

Okay. And do you have a sense of where CVCs and PICC lines? If you give us kind of a sense of where those are growing is about that rate or?

Yeah. So CVCs grew around that rate – around that 6.6% constant currency rate for Vascular North America and PICCs were a little bit lower than that in the Vascular North America area although I would say globally they grew about 18%.

Okay. That’s fair. And the consent decree issue with your competitor, obviously you probably have much visibility on how long that might last although it’s usually pretty prolonged. Do you guys sense is that – I assume that’s boosting your surgical numbers, is that part of the reason why you’re...?

Not yet. Not yet. Those agreements are really didn’t have any significant impact on our first quarter results where is – what – because we’re in a position to supply from a demand standpoint, we have been quite aggressively ramping up those and we are – just doing our best as we really to respond to a critical situation here. But we are certainly leaning in favor of those institutions and groups that are willing to give us a long-term contract with the product. Particularly given the uncertainty of when the issue may be resolved.

Okay. That’s helpful. And then you mentioned, I think you have about $400 million of borrowing capacity, I may have misheard that.

Correct, $400 million.

Yeah.

And so is that about the size, the potential size, could you probably see we use that all for acquisitions or is that – or if I think about you generally have a pretty tight constrains in terms of what the range is in terms of how much leverage you’re willing to take on for an acquisition. Can you give us a sense of where that stand at the moment?

Yeah. So we could go up to that size of borrowing and still be within our comfort range in terms of total leverage. So that’s what readily available on our revolver, we’ve got opportunities to be able to expand the revolver as well by another $250 million if we were to choose that option, that would take some time to get in place, but not too long.

Okay. That’s helpful. I’ll jump back in queue. Thanks a lot.

The next question comes from the line of Anthony Petrone of Jefferies. Please go ahead.

Thanks, good morning. And then congratulations, Liam. Maybe a question on foreign currency, we’re seeing this for some of our other companies. If I look at the EMEA performance and APAC performance even on a constant currency basis it seems to have slowed sequentially. So I guess my question is, do you see a slowdown in demand for your U.S. manufactured goods and products from overseas customers just as their purchasing power has eroded? And then a couple of follow-ups.

Yes. So the short answer to that is, no, we don’t change our pricing in OUS markets based on currency for the most part if we take the hit as opposed to our goods becoming more expensive over there. Europe actually exceeded our expectations, I think that there continues to be a fair amount of economic uncertainty in Europe. So we look at the stability as being good. Our revenue in Japan was really quite good for the quarter, Australia is now since our Mayo acquisition it’s a bigger part of our Asia business and they’re – they tend to be a slower growing developed market. I think for us, our slower performance in Asia was quite limited to China and quite limited to a timing issue I think. So I don’t know that we’re represented of both what’s going on with other countries.

It’s helpful. And then one for Tom, just housekeeping here. Can you just run through the annual savings in interest expense following the senior subordinated tender ones that’s completed, where that will trend. And then we’ll ask follow-up on Percuvance?

Okay. So on the interest expense, we’re assuming that we’re going to save about $0.08 to $0.10 from an adjusted EPS impact. Interest expense will go down to about $51 million for the year. And that’s...

That basis...

Got it.

On an adjusted basis.

Yeah, on a adjusted basis.

On an adjusted basis over 12 months, right. So they’re not – you won’t?

It will go down $251 million for the year, on an adjusted basis.

Got it.

So…

Yeah.

Got it. And then on the last one from me on Percuvance, maybe just a recap in the early days here how that stacks up from a pricing standpoint versus traditional lab instruments. And then you mentioned in the release a few weeks ago, that you’re really looking at a wider launch in 2016, why the time between now and the wider launch and just an update there that would be helpful? Thanks.

So the – the, so we’re still obviously trying to get the best deal on where they should be priced. There is an inherent savings just from one to another from a hospital because they don’t have to use trocars in the procedure. The time it takes to finish up the procedure is shortened, so in a busy overall, that’s another issue. The potential for our complications is reduced which is also a cost savings to the hospital. Why are we doing a gradual launch? This is kind of a – I would characterize it as a major opportunity for Teleflex. My past experience is, is that you learn a lot in the first couple of months in terms of actual user experience, in terms of what the benefits are to highlight, what the training, actual training might be to be able to get this introduced. You also have a better understanding in terms of the best initial procedures to target. And all that in my past experience leads to a much better to launch when you have a little bit of that ground work behind you. So this is a big opportunity. Our sense is we want to do this right and make sure we’re deploying those resources in the best way possible.

Okay. This is the operator. As our communication link has gone down between [indiscernible] and other speakers. There is one more question, would you like to take that?

Yes, we would.

Certainly. So the final question comes from Richard Newitter of Leerink Partners. Your line is open. Please go ahead.

Hi, good morning. It’s Ravi in for Rich. Can you hear me?

Yeah. Go ahead.

Yeah.

Great, thanks. So, a couple of questions and one housekeeping question.. How many on the gross margin, just curious in terms of some of these new PICC introductions, how they affect gross margins versus the corporate average? And then on the Truphatek acquisition, trying to figure out how do these types of vertical integration plays – play into your gross margin expansion strategy. I mean are they necessary or are they sort of a nice to have things as you move towards 55%? And then maybe the last housekeeping question was, Mayo, was that included in the 120 bps of acquisition, because I think there was a month, extra month there?

So yes, you’re absolutely correct. It was in January’s numbers, so there was a month there. In terms of your question about are they nice to have or need to have them, they generally came to make small overall contributions to our overall gross margin picture. However, it really changes the profile of some of those products from one that’s not particularly worth of sales person spending a lot of time to, to one that is worth spending a lot of time to, so they are quite helpful from that standpoint. And there is often other benefits associated with that as we were able to take over the manufacturing of the product and some of the benefits take several years actually to get integrated into our system. But it means that as we look forward to the future, this is a product we really want in both the resources and selling time again as opposed to being kind of a marginal product for us. And I forgot you had another question, I forgot what it was.

Yeah, just really quickly. Just curious in terms of the new product introductions like for example the PICC, how is that coming in compared to the corporate average. Is it sort of in line or lower, you expect to trend higher. Any color on that will be appreciated?

So most of our footprint consolidation moves affect our vascular product lines. And so the real opportunity for improving any of those product lines really is going to come from the completion of this footprint consolidation. So once completed, yes those would be – those would be an attractive product for us to sell.

Thank you.

And then just a little more color on the impact of distributor M&A et cetera on gross margin. So as we think about the 2015 gross margin expansion, there is only three key areas that are driving that expansion. The first is operations efficiency, I’ll include the footprint consolidation in that that accounts for about half of the gain we’re looking for this year. We also then have collectively a number of acquisitions, smaller M&A, as well as go to [indiscernible] and that includes M&A, Mini Lap [indiscernible] Korea distributor, Japanese distributor, those collectively account for another quarter. And then finally, if we look at mix that’s the third kind of the leg of this stool. Now that’s the final quarter and that would be driven largely from things like Vidacare growth. We’re also looking at winding down our surgical repair business. We got to focus in Latin America and mixed improvements and I think anesthesia/respiratory, whether focusing on some higher margin atomization as well as just go product. So as we think about it, our gross margin drivers are largely being driven out of operations efficiency footprint. But M&A go directs are help and mix help. So it’s coming from a variety of different angles and then the rest it’s kind of a number of pluses and minuses that collectively aren’t that significant, if that helps.

Well, very much. So thanks.

I would now like to turn the call over to Jake Elguicze for closing remarks.

Thanks, Operator, and thanks to everyone that joined us on the call today. This concludes the Teleflex Incorporated, first quarter 2015 earnings conference call.