Welcome to the Orthofix International Third Quarter 2015 Earnings Call. Today's is being recorded. At this time, I would like to turn the call over to Mr. Mark Quick, Director of Business Development and Investor Relations. Please go ahead, sir.

Thanks, operator and good afternoon, everyone. I'd like to welcome you to Orthofix' third-quarter 2015 earnings call. Joining me on the call today is our President and Chief Executive Officer, Brad Mason; Chief Financial Officer Doug Rice; and Chief Strategy Officer Mike Finegan. I will start with our Safe Harbor statements and then pass it over to Brad. During this call we will be making forward-looking statements that involve risks and uncertainties. All statements other than those of historical fact are forward-looking statements, including any earnings guidance we provide or any statements about our plans, beliefs, strategies, expectations, goals or objectives. Investors are cautioned not to place undue reliance on such forward-looking statements as there is no assurance that the matters contained in such statements will occur. The forward-looking statements we make on today's call are based on our beliefs and expectations as of today, November 3, 2015. We do not undertake any obligation to revise or update such forward-looking statements. Some factors that could cause actual results to be materially different from the forward-looking statements made by us on the call include the risks disclosed under the heading risk factors in our 2014 Form 10-K as well as additional SEC filings we make in the future. If you need copies, please contact my office at Orthofix in Lewisville, Texas. In addition, note that on today's call we will refer to certain non-GAAP financial measures in which we exclude certain items from our U.S. GAAP financial results. We believe that in order to properly understand our short-term and long-term financial trends, investors may wish to review these matters as a supplement to financial performance measures determined in accordance with U.S. GAAP. Please refer to today's press release announced in our third-quarter 2015 results available on our website for reconciliation of these non-GAAP performance measures to our U.S. GAAP performance results. I'll now turn the call over to Brad.

Thanks, Mark and good afternoon, everyone. Today I will start by giving you a brief update on our third-quarter performance, after which Doug will walk you through the financial results that we reported today. I will then follow up with a few thoughts and expectations going forward before opening it up for Q&A. The third quarter was a very good quarter for Orthofix in many respects, led by the financial results which were at the high end of our expectations. Our Q3 net sales confirms that with the plan we're executing, we will deliver consistent top-line growth. With this growth level despite ongoing improvement in our operating margins, as we realize operating leverage. Now I will give you a few highlights for the third quarter. On the financial side, on a constant currency basis, net sales grew by 4.1% in Q3 over prior year. Adjusted EPS was $0.30. We achieved a 140 basis point gross margin improvement over prior year. The BioStim Strategic Business Unit or SBU, had an exceptional quarter growing net sales at 8.6% over prior year. The Biologics SBU continues to show consistent year-over-year growth in spite of pricing headwinds. During the third quarter, the Extremity Fixation business performed, well given the macro economic challenges faced by many of the countries in which we operate. Trailing 12 month sales grew 1.6% year-over-year on a constant currency basis driven by improving performance of the U.S.. In Spine Fixation, the turnaround continued to gain traction during the quarter in domestic and international net sales, both of which grew sequentially. Total net sales in this SBU grew 4.5% over Q2 which, given that we typically see seasonal weakness in the third quarter, gives us confidence about the current top-line growth trajectory and the SBU's ability to achieve year-over-year growth in…

Thanks, Brad and good afternoon, everyone. I'll start with providing details into our net sales and earnings results and then discuss some of our other financial measures. Total net sales in the quarter were $101.2 million, up slightly from the third quarter 2014 total net sales of $101 million. During the quarter, foreign currency negatively impacted net sales and on a constant currency basis net sales increased by 4.1%. Now I will talk about each strategic business unit in more detail. Starting with our BioStim SBU, 2015 third quarter net sales were $41.6 million, up 8.6% versus the same period in the prior year. The increase was primarily due to continuous improvement in the execution of our commercial strategies which resulted in a growth rate that we believe far outpaced the bone growth stimulation market during the quarter. While we do have a lot of momentum at the moment, we expect to see this SBU growing in the low to mid-single digits. Turning to our Biologics SBU, 2015 third quarter net sales grew $14.6 million, an increase of 5.7% versus the same period in the prior year, primarily driven by the success of Trinity Elite and the expansion [Technical Difficulty] of our distribution footprint which was partially offset by anticipated low single digit pricing pressures. In addition to our growth in spine cases, we expect further penetration of orthopedics markets, most notably extremity procedures. Supporting this effort is the publication of a peer-reviewed study of Trinity Evolution in the Foot and Ankle International Journal, as Brad mentioned. Moving on to our Extremity Fixation SBU, the 2015 third quarter net sales were $24.7 million, a decrease of 10.6% in comparison to the same period in the prior-year due to unfavorable foreign currency impacts. On a constant currency basis, growth was 3.4%,…

Thanks, Doug. Before I discuss guidance, I'd like to update you on our thinking around capital allocation. Our strategy remains unchanged. We will continue to invest in research and development, infrastructure improvements as needed, tuck-in product acquisitions and consider additional options with the goal of accelerating shareholder value by utilizing our available capital. To that end, I'm pleased to report that our Board of Directors has approved a $75 million share repurchase plan. We believe our improving financial performance and significant cash flow generation ability affords us this opportunity to return capital to our shareholders while driving profitable growth. The timing of purchases and the number of shares to be purchased will depend on market conditions and other factors. We will report quarterly on purchases made in the prior quarter, if any. Based on the Company's year-to-date results and updated forecast for the fourth quarter of this year, the Company is narrowing its previous guidance range of net sales from $390 million to $395 million to $392 million to $395 million. Additionally, we're updating our previous adjusted EBITDA guidance range from $57 million to $60 million up to $58 million to $60 million for the year. This guidance assumes constant currency exchange rates from those currently prevailing. Longer-term, we continue to expect that we will consistently grow at or above market growth rates in each of our businesses and achieve greater than 20% adjusted EBITDA margin over time. We look forward to providing you more color around our 2016 expectations on our year-end call in early March. With that, operator, we're ready to open up the lines for questions.

[Operator Instructions]. And your first question will come from Raj Denhoy with Jefferies.

Maybe I could start with the BioStim results in the quarter up 8%, some of the strongest quarter you have had for a while. Was there anything in particular of note this quarter on BioStim that drove that?

No, I just think it's just better execution by the team and better focus and expanding the sales force Roger, I don't think there's anything in particular. There was a roughly a $400,000 adjustment in Q3 of 2014 that would have brought the growth rate down a little bit but just by maybe a point. They are just getting better what they do, they have right team in place, they have got the right focus.

Okay. And then just on revenues as well. So I appreciate the lumpiness and the cash collections quarter in a quarter out given how you recognize foreign sales, but was this a good cash collection quarter for you? Would you describe it that way?

Average. Just average.

So there was no real benefit this quarter or real hit from that particular cycle?

Exactly. That's right Raj.

And then just lastly on the operating spending you know remains pretty heavy. I think you previously talked about 2017 really is when we might see some moderation spending some it's more leverage start to focus through the P&L, is that still the plan that spending will remain strong or heavy as we move through '16?

I think you will start to see a trend down in '16. We're now in a mode where we can put more effort [Technical Difficulty] so I think you'll see some of that begin in '16 and then probably accelerate toward the end of '16 and into '17, Raj.

[Operator Instructions]. From Sidoti & Co we will go to Jim Sidoti.

Just a question on sales force. It sounded like you’re on track with your plans for sales force expansion in 2015. How should we think of that? Should we think that by the end of the year you will be on a level where you feel comfortable or do you think you will continue to the sales force in '16 and '17?

So I think by the end of '15, in the next couple of months we will have what I would say will wrap up our key objective of the year of expansion of aggressive expansion of the sales forces. I think as we get into 2016 and beyond we will always look to expand the sales force wherever we have open territories, Jim and also always look to upgrade where we have some underperforming territories or underperforming distributors. So I think as we get into '16 you will see more steady-state but I'm a believer in getting better and more coverage. That's what you should see going forward.

Okay and then on the simulation business there has been some major changes in the competitive landscape that do think you’re benefiting from that?

We don't see that really, I think what we're benefiting from really is execution of our own strategy more than anything else and the focus that we have on that business now and the leadership that we have. And Brad Niemann and his sales VPs in the regional sales management as well. So I think it's more of that than anything else.

Next from JMP Securities we will hear from David Turkaly.

Biologics, you mentioned some pricing headwinds but I think you guys have a premium product in evolution and I'm just curious given the study and some of the differentiated highlights or features you might be able to point to, do you think that those headwinds abate? Or are you really feeling those on a biologic front given that the profile of that product?

I would say first -- there is minimal, well it's not significant and we continue to grow significant market share in the bone growth segment category. So I don't view it as a significant issue for us. I think the growth prospects are still fantastic. We absolutely have a premium solution for bone grafting and that has not changed in any respect. In addition notwithstanding [indiscernible] Trinity Evolution, Trinity Elite has characteristics that are very favorable compared to any other product in the market and just as a reminder, Trinity Elite is well over 90% of our business combined now. So not a concern.

And then as you look at spine, I guess some -- can you just remind us how much if you can how much your biologic -- I think it's primarily -- how much of that is in spine? And then you mentioned a bunch of new products I think you said you had seven. Do you think that those and it sounded like a bunch of those were [indiscernible] spinal implant side. Do think that returns that division to growth next year, what kind of timing for that to happen?

Let me take this one of the time. The first one is about the Biologics and the association with spine fix. That is still about 85% or 90% of our business is still in spine. I would say probably closer to 85%. In terms of the Spine Fixation business, Dave I'm very pleased with the trajectory we're on as we have made [Technical Difficulty] in how we approach the market and the leadership team that we have there. So I do expect growth in 2016 and there on. I think we have got it back on the right track and I think the last three quarters showed sequential growth and show that and I'm very pleased with that business right now.

And at this time I would like to turn the conference back over to Brad Mason for any additional or concluding remarks.

Well thanks everybody for joining us on the call today. Everybody have a safe and happy holiday season. We'll talk to you in early March. So long.