Daniel A. Carestio
President and Chief Executive Officer at STERIS
Thanks, Mike, and thanks, again, to everyone for taking the time to join us today.
We had a strong start to our fiscal year. Revenue growth in Q1 exceeded our expectations as we saw a faster recovery in customer demand than planned, in particular in our Healthcare and AST segments. Due to strong volume growth, we were able to expand margins nicely during the quarter.
Our integration teams have been hard at work and significant progress has been made integrating Cantel Medical. We are pleased with what we are seeing, but of course, we still have significant work to do. Since the June 2nd close in acquisition, we have made a number of decisions that impact how we go to market with our customer-first mentality. For example, leveraging the talent and expertise of the Cantel sales organization, we have created a dedicated sales channel focus solely on endoscope reprocessing. We added a new Dental segment and mapped the Cantel businesses over to the four STERIS reporting segments.
Executive alignment and leadership has been completely defined from both a field and back office perspective. We have started to educate and implement STERIS lean practices within Cantel. And we have made significant progress realigning our European Healthcare business as we bring STERIS Key Surgical and Cantel together.
From a synergy perspective, we continue to expect a $25 million benefit for this fiscal year, as the majority of the savings are driven by the elimination of corporate costs and much of that integration is complete. In terms of longer-term synergies, we are increasingly confident of exceeding our $110 million cost target as we continue to see opportunities to improve.
Shifting to our outlook. Based on what we have seen in STERIS and across the broader industry, we believe there has been a significantly faster rebound in procedures than we anticipated. This has created stronger demand for capital, consumables and services, and has led us to raise -- revise our guidance upward for the year.
Starting with revenue. Our constant currency organic growth outlook has been increased to 10% to 11% growth for fiscal 2022. This improvement, combined with additional foreign currency benefit and higher expectations for Cantel's medical business, has increased our expectation for total reported revenue to $4.6 billion.
Our organic growth is driven by revenue recovery across business, but in particular from our Healthcare and AST segments.
Within the Healthcare segment, we have record capital backlog at the end of the first quarter with strength in both surgical and infection prevention. The record Healthcare backlog is entirely organic as we have not yet added the Cantel capital equipment to our backlog. Consumables also had a strong start to the year as we have relatively easy comparisons and experienced some restocking by our customers.
AST is also expected to remain strong as our core medical device customers are benefiting from the rebound in procedures and rebuilding some inventory. In addition, we continue to see strong demand for COVID-related products and vaccines, as well as bioprocess manufacturing disposables. Given the strength of AST, our segment allocation will shift from what we shared last quarter. AST is now expected to be approximately 18% of total Company revenue, while Dental will be about 8% of total Company revenue for the full fiscal year.
We are increasing our adjusted earnings per diluted share expectations to a range of $7.60 to $7.85 based on higher volume growth and improved margins. We are mindful that there is still considerable uncertainty around procedural volumes, as we see COVID variants continuing to spread, continued inflationary pressure, and we also have an expectation that we will pick up some increases in OpEx in the second half of the year.
Reflecting on the stronger projected earnings growth, free cash flow expectations have been increased by $20 million.
Fiscal 2022 is shaping up to be another record year for STERIS. We look forward to continue to update all of you on our progress.
I will now turn the call back open -- over to Julie to open up for Q&A. Julie?