Good day, ladies and gentlemen, and welcome to the Q3 2014 Teleflex Incorporated Earnings Conference Call. My name is Allison and I'm your operator for today. [Operator Instructions] As a reminder, this call is being recorded for replay purposes. And I'd now like to turn the call over to Jake Elguicze, Treasurer and Vice President of Investor Relations. Please proceed, sir.

Good morning, everyone, and welcome to the Teleflex Incorporated Third Quarter 2014 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 14097601. Participating on today's call are: Benson Smith, Chairman, President and Chief Executive Officer; and Thomas Powell, Executive Vice President and Chief Financial Officer. Benson and Tom will make brief prepared remarks, and then we'll open up the call up to questions. 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 on Slide 4. 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. With that, I'd like to now turn the call over to Benson.

Thanks, Jake, and good morning, everyone. It's a pleasure to speak with you once again. Similar to prior calls, I'll start with an overview of the company's results and discuss some highlights. Moving on to performance during the first half of the year, we, as a management team, were once again quite pleased with results the company generated in the third quarter. Organic revenue growth improved both year-over-year and sequentially, primarily led by an improvement in domestic markets, the acquisitions of Vidacare and Mayo continue to positively contribute to our results and the company further expanded its operating margin. Combined, these items led to significant earnings per share and further position the company toward the achievement of our longer-term financial goals by the end of 2015. With that as a broad overview, let's review our third quarter results in more detail. Revenue in the third quarter exceeded our expectations and totaled $457.2 million. This represents an increase of 10.5% versus the prior year on an as-reported basis and 10.2% versus the prior year on a constant-currency basis. Our better-than-expected revenue in the third quarter resulted from the overperformance of Vidacare, our ability to continue to generate higher revenue from improvements in average selling prices, increased sales of existing products resulting from share gains and, we believe, a slight improvement in end-market utilization rates. And while we continue to be encouraged by some of the improvements we have seen recently in terms of the U.S. market, we believe it's still too early to call this a trend. Revenue growth in the quarter was somewhat tempered by a decline in year-over-year sales volume of existing products within our Asian segment. Some of the lower volume in Asia relates to a transition of a portion of our Asian business from a distributor to…

Thanks, Benson, and good morning, everyone. During the third quarter, revenues were $457.2 million, which represents an increase of 10.2% on a constant-currency basis. Approximately 5.3% of constant currency revenue growth was related to Vidacare, with the remaining 4.9% of growth coming from distributor-to-direct conversions, an increase in core product volumes, core product price increases and revenues from new product introductions. Turning to gross profit. For the third quarter, adjusted gross profit was $238.1 million versus $205.8 million in the prior year quarter. Adjusted gross margin increased 234 basis points to 52.1%. The increase in adjusted gross margin was primarily due to Vidacare and distributor conversions, with product pricing and product mix also making a positive contribution. Further gross margin gains were limited by higher-than-anticipated manufacturing costs. Turning next to adjusted operating margin. For the third quarter, the adjusted operating margin increased 133 basis points to 21.7%. The year-over-year improvement was the outcome of the gross margin gain, offset by additional SG&A expenses associated with the Vidacare and Mayo businesses and increased sales commission and bonus costs associated with the higher level of revenues. Moving next to our adjusted tax rate. For the third quarter of 2014, the adjusted tax rate was 18.8%, a reduction of 500 basis points from year-ago levels. The improvement in the tax rate was a result of benefits realized from tax planning initiatives and a favorable shift in the mix of income to jurisdictions with lower tax rates. On the bottom line, third quarter adjusted earnings per share came in at $1.57 or an increase of 18%. Additionally, we continue to leverage the growth in earnings to drive operating cash flow. The first 9 months of 2014, cash flow from operations reached $208.8 million, representing an increase of 54% versus the comparable period of 2013.…

[Operator Instructions] Your first question comes from the line of David Lewis from Morgan Stanley.

Benson, I appreciate your comments about the fourth quarter, specifically. I think generally very clear. Just on the low end of guidance for the fourth quarter, that's a more material step than what we expect. Can you just talk about the factors that would bring the low end guidance into perspective in addition to the commentary you've already provided? And I had a couple of follow-ups.

So I think if we took the most conservative view possible, not the most likely view, but the most conservative view possible, it brings us with the risk of being below 8%. Typically, we've done this in half percentage increments, so the next increment below that is 7.5%. It's not the most likely scenario, but we didn't want to be in the position where we gave our guidance now and had to adjust it further in the year if those most conservative potentials turn into realities.

Okay. And then maybe just 2 other quick ones. The first question is just in terms of next year's guidance, and I appreciate we're not going to get that for several months now, but maybe some sort of broad macro guideposts you could provide, specifically around, and for Tom, tax, and the ability to get the 55% gross margins by the end of '15. And then Benson, maybe for you, just given what you've seen here in 2014, the ability to get to a mid-single-digit type organic growth progression. And then just one more and I'll jump back in queue.

Okay. Well, as mentioned, we do intend to give specific guidance as we release our fourth quarter earnings. But just in terms of general, on tax, we had made a commitment to get to 23% on an adjusted basis for 2014 and to be able to carry that rate forward into the future. As we look at where we are this year, we're a bit ahead of that. Some of that is due to some discreet items that we won't be able to replicate. But as I look at that 23%, we feel pretty good about that number, and our goal is to try and bring it down from that. So I would think that 23% would be the higher end and we're working obviously to try and get closer to where we are this year. But again, this year's got some discreet items in it. As for the 55%, our commitment all along has been to achieve 55% as we exit 2015. You heard a bit about the facility footprint project is underway and moving forward, so we feel good about its progress to date. We have a number of other actions that will help us to get to that 55%, we feel good about those plans. So if anything, the discussion about 55% is, one, about timing, not necessarily getting there. So if there were any comment that I'd leave you with is, we feel good about the 55%, we feel good about our ability to get there and perhaps further, the question could be on the variability of when exactly that date occurs. Now we'll give more specific guidance on that as we get into our earnings release for the fourth quarter and providing the guidance. But essentially, we feel pretty good about that 55% right now.

So just, I think, commenting on at least the way, internally, we look at our existing organic growth rate, it's probably more favorable than just using some arithmetic. We're looking at our volume growth, which is now at about 190 basis points, new product growth. I'm going to label it's probably likely to be between 80 and 100 basis points for the year. We think there are some potential to uptick that in 2015 based on our product rollout calendar. Although all the Vidacare revenue this year is counted as acquired growth, a percentage of that is, in fact, organic growth, and so that will go into our organic growth rate starting in December of this year. And then we're going to see a constant stream of dealer-to-direct activities. So this year, for example, we're getting some benefit from Australia, but we're also getting some negatives as a result of the dealer-to-direct transition in Japan. So when we net those out, I would say that we're -- and taking all those things cumulatively, we're between that 4.5% and 5% organic growth rate as we stand today.

Great. Well I know it's early, I appreciate all that feedback. And just maybe one last one, Benson. The message last quarter was we see some SG&A upside, we're going to reinvest that back to certain products, specifically Vidacare and very strong growth from Vidacare. The other pipeline, excluding -- other pipeline products, excluding Vidacare, took a small step forward but clearly is a little below expectations for the year. Is there not some opportunity to reinvest some of this incremental upside into some of the other pipeline products, x Vidacare. And maybe just talk to us about some of the factors that have weighed on the progression of the other Vidacare pipeline programs in '14, and I'll jump back in queue.

Yes, so the short answer to your question is, yes. We are quite excited about the launch of our Eon product line, which is the mini laparoscopic line of instrumentations. We actually thought we were going to launch that in Europe in the fourth quarter. And a leading institution in the United States asked us to delay it until first quarter when we had U.S. approvals so they could be the global launch of the product, but that is certainly consuming some resources as we prepare to launch that product. I mentioned ISO-Gard, that's going to continue to take some investment in channeling that nurse organization enthusiasm for the product into hospital conversions. So we're really not short on opportunities. I think, one of the issues is, when we decided to pull the trigger, midway -- it was almost midway through the third quarter when we had our second quarter earnings call, it just takes a little time to get those in place, and we weren't able to see the benefit of any of that additional spending in the third quarter.

The next question comes from the line of Larry Keusch from Raymond James. Lawrence S. Keusch - Raymond James & Associates, Inc., Research Division: Benson and Tom, I just want to come back to make sure I'm understanding the gating issues associated with the restructuring. It certainly sounds like, Tom, that you guys remain confident in your ability to hit the 55% gross margin, but perhaps the ability to get there exiting the fourth quarter in 2015 maybe now a bit in question. And so, I guess, I just want to understand, what exactly are the moving parts, and make sure I'm interpreting that correctly. And then I've got one other one.

So let me just jump in on the first part. We certainly did not mean to imply that it's in question. I think we have always said that as this project progresses, there is a possibility that we delay closing a facility because of supply issues, et cetera, that's just part of the risk and that if there's any risk to us, it is in timing, not in actually getting to the 55% number. So we really haven't changed our thinking about that, and if it seemed like there was an inference to that point, let's correct that. Lawrence S. Keusch - Raymond James & Associates, Inc., Research Division: Okay. And Tom, on the -- so what's changing out there relative to -- it sounds like you're going to take some expenses this year perhaps that you are not anticipating. So again, if you could just walk us through that, it will be really helpful.

Actually it's going to be less, not more.

Are you talking about the footprint project now? Lawrence S. Keusch - Raymond James & Associates, Inc., Research Division: Yes.

Yes, so essentially what we've outlined now is spending this year -- there's a couple adjustments, none of them that significant, but we are just providing an update as to where our current spending is. So if you like, I can walk you through where we were and where we are now. So capital, initially, we had talked about $10 million to $15 million in the year, we now estimate that to be in the range of $8 million to $10 million. In terms of the restructuring -- restructuring-related expenses, we had previously discussed $22 million to $23 million, we're now expecting $15 million to $17 million. And then other operating expenses, previously were $5 million to $6 million, we now see those as $4 million to $5 million. So just getting back on the point on timing, as we laid out the initial expectations, those are the numbers that we thought we would initially spend. We've now gotten closer to the actual projects and what's going to be involved, and we've got more fine-tuned numbers. And so some of that will be coming forth in the first quarter versus in December of this year. So again, we don't expect any change to the total cost of the entire project. We don't expect any change to the total savings estimate. However, there is a bit of a timing shift here. And again, I wouldn't read too much into that timing shift other than just a refinement of the estimates. Lawrence S. Keusch - Raymond James & Associates, Inc., Research Division: Okay, perfect. And then the last question is, again, just from a high level, you guys have been very effective in obtaining price increases through a variety of means over the last 3 years across virtually all your geographies. But again, could you help us think about that and maybe perhaps help set expectations for how we should be thinking that -- about those abilities to drive price increases as we move forward into 2015?

So obviously, this year, a percentage of what is recorded as price increases comes from dealer-to-direct conversions. We are certainly going to see that continue on through the next several years. It's also responsible for part of our planned margin improvements over those next several years as well. I think we have been positively surprised at our ability to continue to get some non-distributed direct or core pricing up. And I think, in several occasions, we talked in the past about the fact that one of the things that we feel best about is instilling that pricing discipline within our businesses, where they are on the alert for those opportunities to be able to raise prices in certain markets in certain products. So we had been kind of reluctant to not put a longer-term goal out there as we did a couple of years ago, but I think we're still going to continue to see benefits from both those things, dealer-to-direct conversions and also just that inherent pricing discipline now.

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

Just 2 quick detail ones, and then a follow-up. So for fourth quarter, just to check the math, the EPS range is $1.29 to $1.39. And then secondly, quickly, was there any impact from extra day or less day in this quarter?

No, that would be a fourth quarter event.

So the math is good, and just the days were flat with last year in the third quarter?

Yes.

Correct.

Okay. And then -- and so when we look at the second quarter, we had sort of an uptick in European utilization. And then in this quarter, it seems like your 3 kind of North American businesses all saw a nice sequential uptick and then we had sort of this new news in Asia, but it's kind of a small part of your mix. I guess, as we're looking ahead, how long do you think this drag kind of lasts? And then are we expecting sort of -- should we expect that business flattish sequentially as we look forward or down 5% to 10%? I guess any sort of color there because it seems like the majority of what you have is actually improving this year.

So I think just overall, our longer-term view of Asia, China, in particular, is that it's still going to be a growth opportunity and we still see that as an area of investment for us. I think the larger point we're just trying to make here, that I don't think that the growth rates that have been typical out of China for the past 5 years are likely to continue at that same robust number. But I would still say our longer-term expectation is that China grows somewhere between 6% and 8% in our product categories, which still makes it one of the healthiest growers around the world, and we continue to make investments there. The situation in Japan is a very much more time-sensitive kind of thing. We stopped selling to the distributor a couple of months ago, he's selling off his inventory, as I mentioned in my remarks. That process will be concluded sometime in mid-November, we estimate, and then we'll start to sell those hospitals directly. So we'll see a pretty dramatic recovery to Japan as soon as he's out of inventory.

Okay. So overall, it doesn't seem like we're going to be looking at declines, but just maybe slower, I mean, even in this quarter, it was still a decent growth number, just not as robust as it once was.

Correct.

The next question comes from Jason Wittes from Brean Capital.

So a couple of questions here. First off, within Anesthesia, the percentage growth numbers did improve, but you also mentioned that ISO-Gard was off to a slower start than you anticipated. Is that just a case of easy comps or is there some fundamental changes there that we should be aware of in that business?

The easy comps for the Anesthesia/Respiratory business begin in fourth quarter. We had a GPO loss 1 year ago that has been negatively impacting their sales for that entire period. I think that expires -- or 1 year anniversary in the fourth quarter. ISO-Gard is, I would just say, is a product I still have a lot of confidence in. It's a very different sell, it's not a clinical sell, it's almost a workers' safety issue sell, and we are thinking more and more about what we need to do to support that process and try and expedite it. But in the economic climate in the hospital space, it tends to get tied up into these economic value committees in hospitals, which meet slowly and make decisions slowly.

Okay, helpful, I see. Also, you mentioned for last year some excitement. You mentioned ISO-Gard, but you also mentioned Eon will be launched in the first quarter. My understanding was that's going to take some time to sort of develop into the market. There's, I assume, some -- a fair amount of training to be done, et cetera. But -- so should we be thinking that, that will be a driver next year or is that just potential upside next year?

I would characterize it at this point as potential upside for next year. Our expectation is, is that after the launch in the first quarter in the U.S., we're going to be -- roll it out to a limited market release to make sure that the training and educational programs we put together are, in fact, adequate to get physicians comfortable with using it. I would say, though, I continue to be really optimistic about physician interest in this product line, and we continue to anticipate to make other investments to kind of broaden that out.

Okay. Great. And then just a general question on FX. You mentioned the impact this quarter, which will be more pronounced than the -- earlier this year. But should we start to think about that and how that might impact next year? Should it -- do you have any comments on kind of how you think FX shapes out next year and how we should be thinking about it when modeling?

So our thought is -- might not help you much in that area, our thought is there's a lot of volatility going on in currency. Just this week, the euro bounced around quite a bit, and that's one of the reasons why we think we're better served giving guidance time to our fourth quarter earnings release. Having a clear idea of what it's at least likely to look like, and then also understand whatever other mitigating strategies we've been able to put into place to counter that. But I would tell you, every year, we look at what the top 50 banks think is going to happen to the euro next year and the only consistent thing that's happened is they've been wrong each of those 4 years. So we sympathize with your effort to try and pin that down.

Fair enough. I appreciate the color. Just on hedging itself. What kind of hedging do you have in place now and what kind of hedging could you put in place to change that over the next few months if you had to?

Well, we largely think about hedging as a way to protect economically versus from an accounting standpoint. So we're largely hedging transactions where we're transacting in other currencies. We do not currently hedge against translational impact or the accounting impact of translating our foreign books to U.S. dollars. And as we look at that, the cost and other associated complexity of that, we concluded that's not a path we're going to go down. So we're going to continue to be exposed to that translational impact. The currency that impacts us the most, as mentioned, is the euro, just given the relative size of that in our business model. And as Benson mentioned, we've seen currency go up and we've seen it go down, and so some years we'll have a benefit, some years it could be a detriment. And our plan is to continue to build out that financial model with many different earnings drivers so that in those years where it looks like it's going to be a detriment, we've got some other opportunities to pull out of the bag to offset that currency impact. So that's how we're thinking about it. But largely, we try and control the pure economic risk, if you will.

The next question comes from Matt Taylor from Barclays.

I just wanted to clarify your comments on Asia because you talked about it a lot in the prepared comments. So I guess, can you kind of cast out the timing of what you expect here over the next few periods in terms of -- I guess, the biggest impacts are apparently China and Japan. You called that out as a major reason for being more conservative on 4Q guidance, so I guess I just wanted to understand how you've seen things changing either through third quarter or here, to-date, up to the call, and whether if there's anything to be concerned about there?

Yes, so actually, I would put it in the positive column, and here's why I think that -- we do not want to let our distributors get into a situation where they have bloated inventories. The way that most, at least, Chinese, distributors work and also in other parts of Asia, is they tend to make a commitment to buy a certain amount of inventory for a year period. That works well when the markets perform with their expectations. This year, I think, the overall markets are performing below what they thought the growth rate was going to be. And to the extent that, that's true, and to the extent that there is additional inventory in our distributors, we'd rather see that play through in the fourth quarter this year than go into 2015 with any extra inventory in those distributors. So -- and I think part of that is we're in a good position to be able to take care of that, and it's generally how we prefer to operate with our distributors. If there's any lack of clarity is, we don't always know exactly what their sell-through is but we're in the process of having conversations with our majors distributors now as they are contemplating what their fourth quarter orders are.

Okay. And then on FX, I appreciate that nobody has a crystal ball, but you did call out about $0.08 to $0.10 in the fourth quarter. If things don't change much, is that about what you expect at least through the first few periods next year too?

Well, you've got to look at the relative exchange rates in those quarters, so are you -- the $0.08 to $0.10 was relative to where we were in Q3, sequentially, where we're going to be in Q4. So you'd have to look at all the relative exchange rates for those quarters to make that assessment. And I just don't have that information readily available.

Okay. Good. And then I guess for next year, can you talk a little bit about pricing, in general? So I know that there's going to be more direct-to-distributor conversions, maybe a little bit stronger new product cadence. But in general, how do you expect pricing to trend next year for the company as it's been, this year, a pretty good driver of continued growth?

I think, in very general terms, that we're likely to see next year what we're seeing this year.

The next question comes from the line of Raj Denhoy from Jefferies.

Anthony for Raj here. Just a couple on APAC and then shift over to Vidacare and similar items. But in APAC, again, can you remind us how many distributors you have in the region? How many distributors you specifically have in Japan? And are there more opportunities in Japan to go direct over time into 2015? And how do think that would impact your business there?

So I think that the opportunity in Japan is largely going to be completed with the result of the current effort. We still use a layer of subdistributors in Japan and our intention is not to go beyond what I would sort of describe that master distributor, in Japan. So for the most part, Japan will be up and running as we anticipated, should be by the end of this year. China, we have a series of different distributors, some of that is the result of acquisitions that we've recently made. China has a very complex web of distributors, and depending on where in China you want to distribute, whether it's in that main core of hospitals or whether it's in more rural areas, we make different distribution decisions. So that's a little hard to answer and the fact is if we added up all our distributors we'd probably have hundreds of distributors in China that distribute Teleflex products. Our efforts right now in terms of inventory conversations is limited to the few large distributors that we have.

That's very helpful. And then maybe shifting over to Vidacare. Can you give us an idea of where the majority of growth is coming from when you look at the 3 products, Intraosseous, EZ-IO and OnControl? And then as we look out into 2015, what are the opportunities, specifically, across that portfolio, or is it more geographic expansion into other countries that will continue to benefit the Vidacare portfolio?

So first of all, the EZ-IO product is the Intraosseous product. So we really have 2 products, and both of them are doing extremely well and above our expectations. OnControl right now is a little bit more growth-centered in the U.S. EZ-IO, we're seeing growth in every geography where it's positioned. The opportunities over the next couple of years really relate to additional usage in difficult to stick patients, which we're getting increasing acceptance of from the clinician community. That principally relates to expanded use in hospital settings. We also are launching the product in Japan and in China and have approval in both of those countries to start launching it, so that -- there's certainly an element of geographic expansion to it. But I would say, we remain bullish for lots of reasons about the future for Vidacare over the next 5 years. We still see it as a growth product looking out that far.

Great. And the last one for me is, maybe just an update on the Intuitive alliance you announced a few quarters ago for the da Vinci Xi. I believe you're supplying trocars and ports, so is there anything on that front that you can provide an update on?

So I mean, really, our ability to grow that business is -- in that particular setting, has a lot to do with the acceptance of the Intuitive product. We're happy to see that, that is, I think, showing some improvement, and we value that partnership with them.

The next question comes from the line of Matthew Mishan from KeyBanc.

I think first for me is, I think last year you saw a budget flush in Europe at the end of the year. I'm just curious, what are you -- how you're looking at that this year? And are you baking in a tough comp there in the fourth quarter for Europe?

So it's a more typical pattern than an atypical pattern. Last year, we were concerned with a lot of emphasis to cut health care spending as a result of a weakened economy. We were concerned as to whether or not we'd actually see that typical pattern develop. This year, I would say, while there's certainly still some economic uncertainty in Europe, it hasn't translated into a lot of efforts to cut health care spending. So we are less concerned about that not happening this year than we were last year.

Okay. And I apologize if I missed this, I missed the early part of the call, but I think you mentioned some one-off expense benefits that you didn't expect to recur. Just if you could, what were those and quantify them?

Sure. Well I wouldn't say that there was anything significant in particular that we incurred, but we did pick up some benefits related to a fringe on insurance and some other miscellaneous costs, and collectively, they were a benefit during the quarter that we don't expect to reoccur. We also have some seasonality in the fourth quarter related to just how our various conferences are timed, so we've got some higher-level expense in the fourth quarter as a result of that. So I wouldn't be able to point to anything individually that's fairly significant. It was rather a collection of smaller items that had an impact positively in the third quarter, and likewise, we've got some seasonality in the fourth quarter that would shift the other direction.

All right. And then just lastly, on the PICC side, you're able to make various claims against -- with antimicrobial, antithrombogenic, that Bard can't make now. I was just curious if you've been able to make some inroads there, if the competitive dynamics have kind of changed?

So our PICC line is one of our faster-growing product lines on a percentage basis. I think that both those issues, occlusion rates and infection rates, are becoming much more serious topics of conversation in hospitals for a variety of reasons, particularly now having to report those infection rates is driving that concern. So our PICC business was up 22% on a year-over-year comparison this quarter, and we expect that to continue to improve as we're able to marry that technology up with a built-in stylet to take advantage of our targeting position as well. So we're encouraged with our PICC progress.

The next question comes from Chris Cooley from Stephens.

Most of my questions have been addressed, but maybe just quickly, Benson, when you think about moving forward towards 2015, and I realize we're not giving guidance yet, and you look at where you're realizing the bulk of the growth from some of these acquisitions, and then, of course, the conversion, do you focus more on established businesses relative to maybe product lines that you had the opportunity to acquire in the past? I'm just trying to think about if there's any kind of change in the company's M&A strategy or acquisition strategy going forward. Because when you look at the growth in the quarter, admittedly, you did get a healthy 78 bps from new products, but the real driver here, of course, Vidacare and Mayo, and so I'm just trying to think about that as I look out into 2015 and beyond.

Yes, so in terms of our general acquisition strategy, Chris, it remains the same. We are interested in dealer-direct conversions, we still have an interest in late-stage technology acquisitions as a way to augment our internal R&D efforts. And when it comes to more major acquisitions like Vidacare and LMA, we're looking for those opportunities that first of all, provide us higher gross margins than our existing product lines so we can get a margin benefit from them. We're looking for products that have a higher growth rate than our existing organic growth rate and we're looking for products that we think we can really command a significant leading position in that product category: products that are well protected by patents, product that have good brand names associated with them. And that's because we think those products are going to fair the best in the health care environment over the next couple of years as the cost implications of demographics really start to kick in. So that has served us well and our sort of general theory is that if something is working really well, do more of it.

The next question comes from Richard Newitter from Leerink Partners.

This is Ravi actually in for Rich. Question regarding the commentary on the U.S. market, you noted some improvement. Just wondering what do you see going forward? Is there a potential for a potential acceleration here?

So I think I would still describe it as having some ambiguity. We're encouraged by some of the reports and conversations we're having with providers. A big part of their increase seems to be coming more from outpatient and emergency room visits than necessarily acute-care procedures. However, in those product lines that we have that are most affected by acute-care procedures, we saw some accelerating growth. So fourth quarter usually turns out to be a really important trend line for us. We should see a -- and normally see a pretty good pickup in activity in U.S. hospitals in the fourth quarter. So we're hopeful that, that's going to happen, but -- and it's one of the factors that we want to have a better understanding of as we put together our final plans for 2015.

Great. And then one more. Just in terms of the fourth quarter. Are we looking at the same number of selling days or is there going to be 1 fewer or 1 more?

One more day.

The next question comes from Matthew O'Brien from William Blair. Matthew O'Brien - William Blair & Company L.L.C., Research Division: Just to tease out the EPS commentary for Q4 a little bit, because I think that will be the focus of a lot of investors today. I think, Tom, you mentioned some additional dilution, specifically in Q4 associated with the convert and an additional spend most likely for Vidacare or some of the faster-growth higher-margin areas incrementally in Q4. Can you just quantify the impact? Is it a couple of pennies or even less than that?

Well, as we look at the sequential shift, there's a couple of significant factors. So we've called out the FX impact of $0.08 to $0.10. Talked about tax in the range of $0.05. We think the share impact is $0.02. And as far as the incremental investments, we've got a number of programs put in the plan. Again, that's the same comment that we made earlier. We expect to spend it all, the question, if anything, is timing. And that's why the range in our guidance just depending on how much of that we actually get implemented during the fourth quarter. So I don't have a specific number on those additional investments that I'm be willing to quote. Matthew O'Brien - William Blair & Company L.L.C., Research Division: Sure. So just to understand it a little bit better. I mean the midpoint of the range I think is like $1.34, if you add back $0.09 for FX and maybe $0.02 to $0.03 for the shares. And then for some additional spend, we're talking about something closer to, organically, $1.46, $1.47. That seem like reasonable math?

I couldn't argue with the math. Matthew O'Brien - William Blair & Company L.L.C., Research Division: Okay. And then just heading over to the M&A side of things. I know it's a big part of the strategy going forward. I'm sure the landscape is still pretty fruitful, but has anything changed on the valuation side of things just given how things are trending, generally speaking, within med tech land as far as some of the consolidation goes?

So I think the size and type and ownership of the kinds of properties we're looking at haven't been influenced much yet. I think also, I would just point out that we tend to go after targets where we're the most logical buyer and can usually offer more than certainly a private equity company or even another strategic company because we have quite a bit of natural synergy. So we haven't seen that trend as much in the size of companies we're looking at versus some of the other larger acquisitions, which might have additional tax benefits, et cetera.

So you have no questions at this time. [Operator Instructions] No further questions. I would now like to turn the call over to Jake Elguicze for closing remarks.

Thanks, operator, and thanks, everyone, for joining us on the call this morning. This concludes the Teleflex Incorporated Third Quarter 2014 Earnings Conference Call. Have a good day.

Thank you for joining today's conference. This concludes the presentation. You may now disconnect. Have a good day.