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  "documentTitle": "Hill-Rom Holdings, Inc. (HRC)",
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  "authorName": "Ben Axler",
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  "presentationDate": "2019-10-29 00:00:00",
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  "notes": "Uses direct quotes from earnings calls to highlight the shift in management's definition of 'incremental' revenue.",
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      "kind": "callout",
      "text": "Hill-Rom: Q4 FY17 Earnings Call. Claim: 80-85% of new product sales are incremental",
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      "text": "By now claiming that only 50% of new product growth is incremental – and, therefore, that legacy business growth is effectively embedded in 50% of new product growth – management is implicitly claiming that the apparent slowdown in the legacy business is not as drastic as it seems.",
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      "text": "New Product Revenue Contribution: FY16-FY19",
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      "text": "Since management first promoted this round of new products in Q4 FY17, it has quietly walked back its language regarding the extent to which incremental growth relied on new products.",
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      "text": "The biggest piece that probably falls into the gray area is Centrella... most of it is nonreplacement new product growth. So of the ones on that slide that was in the LRP deck, Centrella is probably the only one that materially falls into the cannibalization bucket",
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      "kind": "quote",
      "text": "Just wanted to ask about the new product revenue numbers that you gave.... Within those numbers, do you have a sense of how much of that is sort of incremental revenue versus how much of that is just cannibalizing or replacing existing product sales?",
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      "kind": "quote",
      "text": "\"Just wanted to ask about the new product revenue numbers that you gave.... Within those cards you have a sense of how much of that is sort of incremental revenue versus how much of that is just cannibalizing or replacing existing product sales?\" — Michael Matson – Needham & Company; \"The biggest piece that probably falls into the gray area is Centrella... If I look at the rest of the product growth from where we are today going forward, most of it is nonreplacement new product growth. So of the ones on that slide that was in the LRP deck, Centrella is probably the only one that materially falls into the cannibalization bucket, if that helps.\" — John Greisch – President & CEO, Hill-Rom; \"And I think John also mentioned in his opening comments, the new product momentum has been -- we're very pleased with that. $300 million this year. We exceeded our goal. If you recall, our original goal was about $200 million. So great performance in 2018, and now we're expecting $400 million in 2019. So not all of that is incremental. As you know, we're cannibalizing some of our products, but about half of it will be incremental.\" — Mary Kay Ladone – VP of Investor Relations, Hill-Rom",
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      "text": "1. Source: Q4 FY18 Earnings Call",
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      "text": "Hedging Language Regarding Dependence of Incremental Growth on New Products?",
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