My layman's understanding is that a nerve is kind of a bundle of fibers wrapped in an outer layer. (Perhaps it's reasonable to compare it to a stranded wire inside an insulator, though I wouldn't say for sure.)

He said that if the outer layer is intact, the inner layer can be repaired. I'm not sure if that means more nerve fibers form or that existing nerve fibers are repaired but that the repair takes place incrementally instead of all at once. Intuitively it seems to make sense that a new fiber is growing, but I'm wary of speculating based on what seems to make sense to me.