COVER
COVER - shares | 6 Months Ended | |
Jun. 30, 2023 | Jul. 21, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 1-16137 | |
Entity Registrant Name | INTEGER HOLDINGS CORPORATION | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 16-1531026 | |
Entity Address, Address Line One | 5830 Granite Parkway, | |
Entity Address, Address Line Two | Suite 1150 | |
Entity Address, City or Town | Plano, | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75024 | |
City Area Code | 214 | |
Local Phone Number | 618-5243 | |
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | ITGR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 33,308,080 | |
Entity Central Index Key | 0001114483 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --12-31 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 38,615 | $ 24,272 |
Accounts receivable, net of provision for credit losses of $0.4 million and $0.3 million, respectively | 236,526 | 224,325 |
Inventories | 228,931 | 208,766 |
Refundable income taxes | 3,030 | 2,003 |
Contract assets | 80,010 | 71,927 |
Prepaid expenses and other current assets | 28,816 | 27,005 |
Total current assets | 615,928 | 558,298 |
Property, plant and equipment, net | 348,895 | 317,243 |
Goodwill | 985,982 | 982,192 |
Other intangible assets, net | 797,594 | 819,889 |
Deferred income taxes | 6,447 | 6,247 |
Operating lease assets | 70,281 | 74,809 |
Financing lease assets | 8,537 | 8,852 |
Other long-term assets | 27,680 | 26,856 |
Total assets | 2,861,344 | 2,794,386 |
Current liabilities: | ||
Current portion of long-term debt | 5,000 | 18,188 |
Accounts payable | 107,507 | 110,780 |
Income taxes payable | 3,036 | 10,923 |
Operating lease liabilities | 10,075 | 10,362 |
Accrued expenses and other current liabilities | 74,214 | 73,499 |
Total current liabilities | 199,832 | 223,752 |
Long-term debt | 980,398 | 907,073 |
Deferred income taxes | 152,926 | 160,671 |
Operating lease liabilities | 59,988 | 64,049 |
Financing lease liabilities | 7,677 | 8,006 |
Other long-term liabilities | 14,868 | 13,379 |
Total liabilities | 1,415,689 | 1,376,930 |
Commitments and contingencies (Note 10) | ||
Stockholders’ equity: | ||
Common stock, $0.001 par value; 100,000,000 shares authorized; 33,308,080 and 33,169,778 shares issued and outstanding, respectively | 33 | 33 |
Additional paid-in capital | 715,715 | 731,393 |
Retained earnings | 717,737 | 680,701 |
Accumulated other comprehensive income | 12,170 | 5,329 |
Total stockholders’ equity | 1,445,655 | 1,417,456 |
Total liabilities and stockholders’ equity | $ 2,861,344 | $ 2,794,386 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Allowance for doubtful accounts | $ 0.4 | $ 0.3 |
Stockholders’ equity: | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 33,308,080 | 33,169,778 |
Common stock, shares outstanding (in shares) | 33,308,080 | 33,169,778 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Income Statement [Abstract] | ||||
Sales | $ 400,044 | $ 350,081 | $ 778,829 | $ 660,993 |
Cost of sales | 294,240 | 257,184 | 576,352 | 486,621 |
Gross profit | 105,804 | 92,897 | 202,477 | 174,372 |
Operating expenses: | ||||
Selling, general and administrative | 45,827 | 41,786 | 87,713 | 81,346 |
Research, development and engineering | 16,883 | 14,871 | 35,975 | 30,954 |
Restructuring and other charges | 1,518 | 3,533 | 3,047 | 6,868 |
Total operating expenses | 64,228 | 60,190 | 126,735 | 119,168 |
Operating income | 41,576 | 32,707 | 75,742 | 55,204 |
Interest expense | 11,459 | 7,773 | 28,713 | 13,741 |
(Gain) loss on equity investments | (134) | 320 | 21 | 2,724 |
Other loss, net | 359 | 191 | 1,119 | 368 |
Income before taxes | 29,892 | 24,423 | 45,889 | 38,371 |
Provision for income taxes | 5,921 | 3,587 | 8,853 | 6,168 |
Net income | $ 23,971 | $ 20,836 | $ 37,036 | $ 32,203 |
Earnings per share: | ||||
Basic (in dollars per share) | $ 0.72 | $ 0.63 | $ 1.11 | $ 0.97 |
Diluted (in dollars per share) | $ 0.71 | $ 0.62 | $ 1.10 | $ 0.97 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 33,312 | 33,111 | 33,285 | 33,101 |
Diluted (in shares) | 33,686 | 33,350 | 33,631 | 33,326 |
Comprehensive Income (Loss) | ||||
Net income | $ 23,971 | $ 20,836 | $ 37,036 | $ 32,203 |
Other comprehensive income (loss): | ||||
Foreign currency translation gain (loss) | (2,901) | (27,274) | 5,024 | (35,161) |
Change in fair value of cash flow hedges, net of tax | 105 | (47) | 1,817 | 2,687 |
Other comprehensive income (loss), net of tax | (2,796) | (27,321) | 6,841 | (32,474) |
Comprehensive income (loss), net of tax | $ 21,175 | $ (6,485) | $ 43,877 | $ (271) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 37,036 | $ 32,203 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 48,569 | 45,753 |
Debt related charges included in interest expense | 6,118 | 962 |
Inventory step-up amortization | 0 | 798 |
Stock-based compensation | 11,603 | 10,951 |
Non-cash lease expense | 5,473 | 5,344 |
Non-cash loss on equity investments | 21 | 2,724 |
Contingent consideration fair value adjustment | (265) | 0 |
Other non-cash (gains) losses | (1,437) | 7,510 |
Deferred income taxes | (4) | (969) |
Changes in operating assets and liabilities, net of acquisition: | ||
Accounts receivable | (9,742) | (37,642) |
Inventories | (21,646) | (41,471) |
Prepaid expenses and other assets | 1,308 | (783) |
Contract assets | (7,983) | (6,189) |
Accounts payable | 797 | 25,554 |
Accrued expenses and other liabilities | 1,781 | (7,295) |
Income taxes | (9,296) | (439) |
Net cash provided by operating activities | 62,333 | 37,011 |
Cash flows from investing activities: | ||
Acquisition of property, plant and equipment | (57,416) | (22,610) |
Proceeds from sale of property, plant and equipment | 50 | 587 |
Acquisitions, net of cash acquired | 0 | (126,636) |
Net cash used in investing activities | (57,366) | (148,659) |
Cash flows from financing activities: | ||
Principal payments of term loans | (398,438) | (7,625) |
Proceeds from issuance of convertible notes, net of discount | 486,250 | 0 |
Proceeds from revolving credit facility | 229,604 | 160,000 |
Payments of revolving credit facility | (263,443) | (34,000) |
Purchase of capped calls | (35,000) | 0 |
Payment of debt issuance costs | (2,181) | 0 |
Proceeds from the exercise of stock options | 1,948 | 0 |
Tax withholdings related to net share settlements of restricted stock unit awards | (2,930) | (1,926) |
Contingent consideration payments | (7,660) | (493) |
Principal payments on finance leases | (557) | (353) |
Net cash provided by financing activities | 7,593 | 115,603 |
Effect of foreign currency exchange rates on cash and cash equivalents | 1,783 | (6,247) |
Net increase (decrease) in cash and cash equivalents | 14,343 | (2,292) |
Cash and cash equivalents, beginning of period | 24,272 | 17,885 |
Cash and cash equivalents, end of period | $ 38,615 | $ 15,593 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) - USD ($) $ in Thousands | Total | Common stock and additional paid-in capital | Retained earnings | Accumulated other comprehensive income |
Balance, beginning of period at Dec. 31, 2021 | $ 1,354,697 | $ 713,183 | $ 614,324 | $ 27,190 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Stock awards exercised or vested | (1,926) | |||
Stock-based compensation | 10,951 | |||
Capped calls related to the issuance of convertible notes, net of tax | 0 | |||
Net income | 32,203 | 32,203 | ||
Other comprehensive income (loss) | (32,474) | (32,474) | ||
Balance, ending balance at Jul. 01, 2022 | 1,363,451 | 722,208 | 646,527 | (5,284) |
Balance, beginning of period at Apr. 01, 2022 | 1,364,350 | 716,622 | 625,691 | 22,037 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Stock awards exercised or vested | (370) | |||
Stock-based compensation | 5,956 | |||
Capped calls related to the issuance of convertible notes, net of tax | 0 | |||
Net income | 20,836 | 20,836 | ||
Other comprehensive income (loss) | (27,321) | (27,321) | ||
Balance, ending balance at Jul. 01, 2022 | 1,363,451 | 722,208 | 646,527 | (5,284) |
Balance, beginning of period at Dec. 31, 2022 | 1,417,456 | 731,426 | 680,701 | 5,329 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Stock awards exercised or vested | (1,031) | |||
Stock-based compensation | 11,603 | |||
Capped calls related to the issuance of convertible notes, net of tax | (26,250) | |||
Net income | 37,036 | 37,036 | ||
Other comprehensive income (loss) | 6,841 | 6,841 | ||
Balance, ending balance at Jun. 30, 2023 | 1,445,655 | 715,748 | 717,737 | 12,170 |
Balance, beginning of period at Mar. 31, 2023 | 1,417,936 | 709,204 | 693,766 | 14,966 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Stock awards exercised or vested | 1,043 | |||
Stock-based compensation | 5,501 | |||
Capped calls related to the issuance of convertible notes, net of tax | 0 | |||
Net income | 23,971 | 23,971 | ||
Other comprehensive income (loss) | (2,796) | (2,796) | ||
Balance, ending balance at Jun. 30, 2023 | $ 1,445,655 | $ 715,748 | $ 717,737 | $ 12,170 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION Integer Holdings Corporation (together with its consolidated subsidiaries, “Integer” or the “Company”) is a publicly-traded corporation listed on the New York Stock Exchange under the symbol “ITGR.” Integer is a medical device outsource manufacturer serving the cardiac rhythm management , neuromodulation, orthopedics, vascular, advanced surgical and portable medical markets. The Company provides innovative, high-quality medical technologies that enhance the lives of patients worldwide. In addition to medical technologies, the Company develops batteries for high-end niche applications in the energy, military, and environmental markets. The Company’s customers include large multi-national original equipment manufacturers (“OEMs”) and their affiliated subsidiaries. The accompanying condensed consolidated financial statements are presented in accordance with the rules and regulations of the United States ("U.S.") Securities and Exchange Commission ("SEC") and do not include all of the disclosures normally required by U.S. generally accepted accounting principles (“U.S. GAAP”) as contained in the Company’s Annual Report on Form 10-K. Accordingly, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2022 . In the opinion of management, the condensed consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the results of the Company for the periods presented. The results for interim periods are not necessarily indicative of results or trends that may be expected for the fiscal year as a whole. The condensed consolidated financial statements were prepared using U.S. GAAP, which require management to make estimates and assumptions that affect the reported amounts of assets, liabilities, certain components of equity, sales, expenses, and related disclosures at the date of the financial statements and during the reporting period. Actual results could differ materially from these estimates. The second quarter and first six months of 2023 ended on June 30 and consisted of 91 days and 181 days, respectively. The second quarter and first six months of 2022 ended on July 1 and consisted of 91 days and 182 days, respectively. Trade Accounts Receivable - Factoring Arrangements In the second quarter of 2023, the Company entered into a receivables factoring arrangement, pursuant to which certain receivables may be sold to a financial institution without recourse in exchange for cash. Transactions under the receivables factoring arrangement are accounted for as sales under ASC 860, Transfers and Servicing of Financial Assets , with the sold receivables removed from the Company’s balance sheet. Under this arrangement, the Company does not maintain any beneficial interest in the receivables sold. Once sold, the receivables are no longer available to satisfy creditors in the event of bankruptcy. Sale proceeds are reflected in Cash flows from operating activities on the Condensed Consolidated Statements of Cash Flows. Factoring fees are recorded in Selling, general, and administrative expenses in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). During the six months ended June 30, 2023, the Company sold, without recourse, $50.3 million of accounts receivable. Factoring fees were $0.4 million for the three and six months ended June 30, 2023. Recent Accounting Pronouncements The Company considers the applicability and impact of all Accounting Standard Updates (“ASU”) issued by the Financial Accounting Standards Board (“FASB”). The Company evaluated all recent accounting pronouncements issued, including those that are currently effective, and determined that the adoption of these pronouncements would not have a material effect on the financial position, results of operations or cash flows of the Company. There have been no new or material changes to the significant accounting policies discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, that are of significance, or potential significance, to the Company. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 6 Months Ended |
Jun. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
BUSINESS ACQUISITIONS | BUSINESS ACQUISITIONS On April 6, 2022, the Company acquired 100% of the equity interests of Connemara Biomedical Holdings Teoranta, including its operating subsidiaries Aran Biomedical and Proxy Biomedical (collectively “Aran”), a recognized leader in proprietary medical textiles, high precision biomaterial coverings and coatings as well as advanced metal and polymer braiding. Aran delivers development and manufacturing solutions for implantable medical devices. Consistent with the Company’s strategy, the combination with Aran further increases Integer’s ability to offer complete solutions for complex delivery and therapeutic devices in high growth cardiovascular markets such as structural heart, neurovascular, peripheral vascular, and endovascular as well as general surgery. The Company funded the purchase price with borrowings under its Revolving Credit Facility. Aran is included in the Company’s Medical segment. The total consideration transferred was $141.3 million, which includes an initial cash payment of $133.9 million ($129.3 million net of cash acquired) and $7.4 million in estimated fair value of contingent consideration. The contingent consideration represents the estimated fair value of the Company’s obligation, under the purchase agreement, to make additional payments of up to €10 million ($10.9 million at the exchange rate as of April 6, 2022) based on Aran’s achievement of 2022 revenue growth milestones. The earn-out period ended on December 31, 2022 and, in accordance with the terms of the share purchase agreement, full payment was made in April 2023. See Note 13 “Financial Instruments and Fair Value Measurements” for additional information related to the fair value measurement of the contingent consideration. The cost of the acquisition was allocated to the assets acquired and liabilities assumed based upon their estimated fair value at the date of the acquisition. There were no adjustments to the initial purchase price allocation. The following table summarizes the final fair values of the assets acquired and liabilities assumed (in thousands): Fair value of net assets acquired Current assets $ 9,319 Property, plant and equipment 4,151 Goodwill 68,460 Definite-lived intangible assets 71,485 Operating lease assets 3,505 Other noncurrent assets 1,354 Current liabilities (4,370) Operating lease liabilities (3,258) Other noncurrent liabilities (9,377) Fair value of net assets acquired $ 141,269 Pro Forma (unaudited) disclosures The following table presents (in thousands) unaudited pro forma results of operations for the three and six months ended July 1, 2022 as if Aran had been included in the Company’s financial results as of the beginning of fiscal year 2021, through the date of acquisition. The pro forma results include the historical results of operations of the Company and Aran, as well as adjustments for additional amortization of the assets acquired, additional interest expense related to the financing of the transactions and other transactional adjustments. The pro forma results do not include efficiencies, cost reductions or synergies expected to result from the acquisition. These pro forma results do not purport to be indicative of the results that would have been obtained, or to be a projection of results that may be obtained in the future. Three Months Ended July 1, 2022 Six Months Ended July 1, 2022 Sales $ 350,081 $ 666,356 Net income 22,101 34,228 Acquisition costs Direct costs of this acquisition were not material for the three and six months ended June 30, 2023. During the three and six months ended July 1, 2022, direct costs of this acquisition of $1.5 million and $2.3 million were expensed as incurred and included in Restructuring and other charges in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 6 Months Ended |
Jun. 30, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | SUPPLEMENTAL CASH FLOW INFORMATION The following is supplemental information relating to the Condensed Consolidated Statements of Cash Flows (in thousands): Six Months Ended June 30, July 1, Noncash investing and financing activities: Property, plant and equipment purchases included in accounts payable $ 9,059 $ 6,373 Supplemental lease disclosures: Assets acquired under operating leases 912 11,265 |
INVENTORIES
INVENTORIES | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories comprise the following (in thousands): June 30, December 31, Raw materials $ 102,280 $ 98,640 Work-in-process 112,887 98,188 Finished goods 13,764 11,938 Total $ 228,931 $ 208,766 |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS, NET | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS, NET | GOODWILL AND OTHER INTANGIBLE ASSETS, NET Goodwill The changes in the carrying amount of goodwill by reportable segment for the six months ended June 30, 2023 were as follows (in thousands): Medical Non- Medical Total December 31, 2022 $ 965,192 $ 17,000 $ 982,192 Foreign currency translation 3,790 — 3,790 June 30, 2023 $ 968,982 $ 17,000 $ 985,982 Intangible Assets Intangible assets comprise the following (in thousands): Gross Accumulated Net June 30, 2023 Definite-lived: Purchased technology and patents $ 284,921 $ (187,279) $ 97,642 Customer lists 829,550 (234,506) 595,044 Amortizing tradenames and other 21,012 (6,392) 14,620 Total amortizing intangible assets $ 1,135,483 $ (428,177) $ 707,306 Indefinite-lived: Trademarks and tradenames $ 90,288 December 31, 2022 Definite-lived: Purchased technology and patents $ 283,929 $ (178,844) $ 105,085 Customer lists 825,634 (216,546) 609,088 Amortizing tradenames and other 21,028 (5,600) 15,428 Total amortizing intangible assets $ 1,130,591 $ (400,990) $ 729,601 Indefinite-lived: Trademarks and tradenames $ 90,288 Aggregate intangible asset amortization expense comprises the following (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Cost of sales $ 4,037 $ 4,037 $ 8,014 $ 7,682 Selling, general and administrative expenses 9,070 8,248 18,017 16,207 Total intangible asset amortization expense $ 13,107 $ 12,285 $ 26,031 $ 23,889 Estimated future intangible asset amortization expense based on the carrying value as of June 30, 2023 is as follows (in thousands): Remainder of 2023 2024 2025 2026 2027 After 2027 Amortization Expense $ 26,368 $ 51,803 $ 51,014 $ 49,189 $ 46,232 $ 482,700 |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Long-term debt comprises the following (in thousands): June 30, 2023 December 31, 2022 Principal Amount UnamortizedDiscounts and Issuance Costs Net Carrying Amount Principal Amount UnamortizedDiscounts and Issuance Costs Net Carrying Amount Senior Secured Credit Facilities: Revolving credit facilities $ 108,640 $ — $ 108,640 $ 140,300 $ — $ 140,300 Term loan A 392,500 (1,958) 390,542 455,313 (2,172) 453,141 Term loan B — — — 335,625 (3,805) 331,820 Convertible Senior Notes due 2028 500,000 (13,784) 486,216 — — — Total $ 1,001,140 $ (15,742) $ 985,398 $ 931,238 $ (5,977) $ 925,261 Current portion of long-term debt (5,000) (18,188) Long-term debt $ 980,398 $ 907,073 Senior Secured Credit Facilities On September 2, 2021, the Company entered into a credit agreement (the “2021 Credit Agreement”), governing the Company’s senior secured credit facilities (the “Senior Secured Credit Facilities”). As of December 31, 2022, the Senior Secured Credit Facilities consisted of a five-year $400 million revolving credit facility (the “Revolving Credit Facility”), a five-year “term A” loan (the “TLA Facility”) and a seven-year “term B” loan (the “TLB Facility” and, together with the TLA Facility, the “Term Loan Facilities”). The TLB Facility was issued at a 0.50% discount. Amendments to the 2021 Credit Agreement On January 30, 2023, the Company entered into a first amendment (the “First Amendment”) to the 2021 Credit Agreement to, among other things: (i) permit the Company to issue the notes (described below under 2028 Convertible Note s and Related Capped Call Transactions) and incur indebtedness thereunder in an aggregate principal amount of up to $600 million at any time outstanding; (ii) permit the Company to enter into bond hedge and capped call transactions; (iii) permit the Company to issue call options, warrants or purchase rights relating to the Company’s common stock; provided, in each case, that the terms of any such transaction are customary for transactions of such type. On February 15, 2023, the Company entered into a second amendment (the “Second Amendment”) to the 2021 Credit Agreement to, among other things: (i) increase the maximum borrowing capacity under the Revolving Credit Facility by $100 million from $400 million to $500 million, (ii) extend the maturity date for both the Revolving Credit Facility and the TLA Facility to February 15 , 2028, (iii) allow for borrowings by the Company under the Revolving Credit Facility denominated in Euros, subject to a sublimit equal to 50% of the maximum borrowing capacity under the Revolving Credit Facility, (iv) replace the LIBOR-based reference interest rate option with a forward-looking term rate based on the secured overnight financing rate (SOFR) for the applicable interest period plus an adjustment of 0.10% per annum (“Adjusted Term SOFR”), and (v) add carveouts to certain negative covenants included within the 2021 Credit Agreement to permit the expansion of capacity in Ireland by the Company and incur indebtedness related thereto. The information provided below reflects the First Amendment and Second Amendment (collectively the “2023 Amendments”) described above. Details of our Long-term debt as of December 31, 2022 can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Revolving Credit Facility The Revolving Credit Facility matures on February 15 , 2028 . As of June 30, 2023, the Company had available borrowing capacity on the Revolving Credit Facility of $387.9 million after giving effect to $108.6 million of outstanding borrowings and $3.5 million of outstanding standby letters of credit. Borrowings under the Revolving Credit Facility will bear interest at a rate of Adjusted Term SOFR, in relation to any loan in U.S. dollars, and EURIBOR, in relation to any loan in Euros, plus a margin based on the Company’s Secured Net Leverage Ratio (as defined in the Senior Secured Credit Facilities agreement). In addition, the Company is required to pay a commitment fee on the unused portion of the Revolving Credit Facility, which will range between 0.15% and 0.25%, depending on the Company’s Secured Net Leverage Ratio. As of June 30, 2023, the weighted average interest rate on outstanding borrowings under the Revolving Credit Facility was 4.92% and the commitment fee on the unused portion of the Revolving Credit Facility was 0.18%. (6.) DEBT (Continued) Term Loan Facilities The TLA Facility matures on February 15 , 2028 , and requires quarterly installments. The quarterly principal installments under the TLA Facility increase over the term of the loan. The interest rate terms for the TLA Facility are the same as those above for the Revolving Credit Facility borrowings in U.S. dollars. As of June 30, 2023, the interest rate on the TLA Facility was 6.70%. In February 2023, the Company used a portion of the proceeds from its notes offering (see 2028 Convertible Senior Notes and Related Capped Call Transactions ) to settle in full principal and interest due under the TLB Facility. Deferred Debt Issuance Costs and Discounts The change in deferred debt issuance costs related to the Company’s Revolving Credit Facility is as follows (in thousands): December 31, 2022 $ 2,387 Financing costs incurred 579 Write-off of deferred debt issuance costs (260) Amortization during the period (271) June 30, 2023 $ 2,435 The change in unamortized discount and deferred debt issuance costs related to the Term Loan Facilities is as follows (in thousands): Deferred Debt Issuance Costs Unamortized Discount on TLB Facility Total December 31, 2022 $ 4,569 $ 1,408 $ 5,977 Financing costs incurred 418 — 418 Write-off of deferred debt issuance costs and unamortized discount (2,780) (1,391) (4,171) Amortization during the period (249) (17) (266) June 30, 2023 $ 1,958 $ — $ 1,958 Debt issuance costs are either deferred and amortized over the term of the associated debt or expensed as incurred. In connection with the 2023 Amendments , the Company incurred and capitalized an aggregate of $1.0 million of debt issuance costs. In connection with the 2023 Amendments, for each separate debt instrument on a lender by lender basis, in accordance with ASC 470-50, Debt Modifications and Extinguishment , the Company performed an assessment of whether the transaction was deemed to be new debt, a modification of existing debt, or an extinguishment of existing debt. Based on this assessment, $3.8 million of unamortized deferred debt issuance costs related to the Revolving Credit Facility and TLA Facility were deemed to be related to the issuance of new debt, or the modification of existing debt, and therefore will continue to be deferred and amortized over the term of the associated debt. The remaining $0.6 million of unamortized deferred debt issuance costs related to the Revolving Credit Facility and TLA Facility were deemed to be related to the extinguishment of debt and were expensed and included in Interest expense during the six months ended June 30, 2023. Additionally, i n connection with the full repayment of the TLB Facility, the Company incurred a $3.8 million loss on extinguishment of debt from the write-off of the remaining deferred debt issuance costs and original issue discount, which were expensed and included in Interest expense during the six months ended June 30, 2023. Covenants The Senior Secured Credit Facilities agreement contains customary terms and conditions, including representations and warranties and affirmative and negative covenants, as well as financial covenants for the benefit of the lenders under the Revolving Credit Facility and the TLA Facility, which require that (i) the Company maintain a Total Net Leverage Ratio not to exceed 5.50:1.00 (stepping down to 5.00:1.00 for the third fiscal quarter of 2023 through maturity and subject to increase in certain circumstances following qualified acquisitions, but shall not exceed 5.50:1.00) and (ii) the Company maintain an interest coverage ratio of at least 2.50:1.00. As of June 30, 2023, the Company was in compliance with these financial covenants. (6.) DEBT (Continued) Contractual maturities under the Senior Secured Credit Facilities for the remainder of 2023 and through maturity, excluding any discounts or premiums, as of June 30, 2023 are as follows (in thousands): Remainder of 2023 2024 2025 2026 2027 After 2027 Future minimum principal payments $ — $ 10,000 $ 17,500 $ 27,500 $ 30,000 $ 416,140 2028 Convertible Senior Notes and Related Capped Call Transactions In February of 2023, the Company issued $500 million aggregate principal amount of Convertible Senior Notes due in 2028 (“2028 Notes”) in a private offering, which aggregate principal amount included the exercise in full of the initial purchasers’ option to purchase up to an additional $65 million principal amount of the 2028 Notes. The 2028 Notes mature on February 15, 2028 and bear interest at a fixed rate of 2.125% per annum, payable semiannually in arrears on February 15 and August 15 of each year, beginning on August 15, 2023. The total net proceeds from the issuance of the 2028 Notes (which includes the additional proceeds from the purchasers’ option), after deducting initial purchasers' discounts and commissions and debt issuance costs, were approximately $485 million. Conversion and Redemption Terms of the 2028 Notes Each $1,000 principal amount of the 2028 Notes is initially convertible into 11.4681 shares of the Company’s common stock (the “2028 Conversion Option”), which is equivalent to an initial conversion price of approximately $87.20 per share of common stock, subject to standard anti-dilutive adjustments and adjustments upon the occurrence of specified events. The initial conversion price represents a premium of approximately 32.5% to the $65.81 per share closing price of the Company’s common stock on January 31, 2023. The 2028 Notes are convertible, in multiples of $1,000 principal amount, at the option of the holders prior to the close of business on the business day immediately preceding November 15, 2027, only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2023 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any ten consecutive trading day period (the “Measurement Period”) in which the trading price (as defined in the Indenture governing the 2028 Notes) per $1,000 principal amount of the 2028 Notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate in effect on each such trading day; (3) if the Company calls any or all of the 2028 Notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. On or after November 15, 2027 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their 2028 Notes, in multiples of $1,000 principal amount, at the option of the holder regardless of the foregoing circumstances. Upon conversion, the 2028 Notes will be settled in cash up to the aggregate principal amount of the 2028 Notes to be converted, and in cash, shares of the Company’s common stock or a combination thereof, at the Company’s option, in respect of the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the 2028 Notes being converted. If the Company undergoes a fundamental change (as defined in the indenture governing the 2028 Notes), subject to certain conditions, holders may require the Company to repurchase for cash all or any portion of their 2028 Notes, in principal amounts of $1,000 or a multiple thereof, at a fundamental change repurchase price equal to 100% of the principal amount of the 2028 Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. In addition, following certain corporate events or if the Company issues a notice of redemption, it will, under certain circumstances, increase the conversion rate for holders who elect to convert their notes in connection with such corporate event or during the relevant redemption period. As of June 30, 2023, the conditions allowing holders of the Convertible Notes to convert had not been met and, therefore, the Convertible Notes are classified as a long-term liability on the Condensed Consolidated Balance Sheets at June 30, 2023. (6.) DEBT (Continued) The Company may not redeem the 2028 Notes prior to February 20, 2026. The Company may redeem for cash all or any portion of the 2028 Notes, at its option, on or after February 20, 2026 and prior to February 15, 2028, if the last reported sale price of its common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending not more than two Seniority of the 2028 Notes The 2028 Notes are the Company’s senior unsecured obligations and rank senior in right of payment to any of the Company’s indebtedness that is expressly subordinated in right of payment to the 2028 Notes; equal in right of payment to any of the Company’s unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (including trade payables) of the Company’s subsidiaries. Indenture The Company issued the Notes pursuant to an indenture dated as of February 3, 2023 (the “Indenture”) by and between the Company and Wilmington Trust, National Association, as trustee. The Indenture provides for customary events of default, which include (subject in certain cases to grace and cure periods), among others: nonpayment of principal or interest; failure by the Company to comply with its conversion obligations upon exercise of a holder’s conversion right under the Indenture; breach of covenants or other agreements in the Indenture; defaults by the Company or any significant subsidiary (as defined in the Indenture) with respect to other indebtedness in excess of a threshold amount; failure by the Company or any significant subsidiary to pay final judgments in excess of a threshold amount; and the occurrence of certain events of bankruptcy, insolvency or reorganization with respect to the Company or any significant subsidiary. Generally, if an event of default occurs and is continuing under the Indenture, either the Indenture trustee or the holders of at least 25% in aggregate principal amount of the 2028 Notes then outstanding may declare the principal amount plus accrued and unpaid interest on the Notes to be immediately due and payable. Covenants The 2028 Notes do not contain financial maintenance covenants. Deferred Debt Issuance Costs and Discounts The 2028 Notes are accounted for as a single liability measured at amortized cost. The discount and issuance costs related to the 2028 Notes are being amortized to interest expense over the contractual term of the 2028 Notes at an effective interest rate of 2.76%. Fair Value of the 2028 Notes The estimated fair value of the 2028 Notes was approximately $593 million as of June 30, 2023. The estimated fair value of the 2028 Notes was determined through consideration of quoted market prices. The fair value of the 2028 Notes are categorized in Level 2 of the fair value hierarchy. Capped Call Transactions In connection with the issuance of the 2028 Notes, the Company entered into privately negotiated capped call transactions (the “Capped Calls”) with certain financial institutions. The Capped Calls are expected generally to reduce the potential dilution to the Company’s common stock in connection with any conversion of the 2028 Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted 2028 Notes, as the case may be, with such reduction and/or offset subject to a cap based on strike price of written warrants. The initial upper strike price of the Capped Calls is $108.59 per share and is subject to certain adjustments under the terms of the Capped Calls. The Capped Calls cover, subject to anti-dilution adjustments, approximately 5.7 million shares of the Company’s common stock, the same number of shares initially underlying the 2028 Notes. For accounting purposes, the Capped Calls are separate transactions, and not integrated with the issuance of the 2028 Notes. As these transactions meet certain accounting criteria, the Capped Calls are recorded in stockholders’ equity and are not accounted for as derivatives. The 2028 Notes and the Capped Calls will be integrated for tax purposes. The accounting impact of this tax treatment results in the Capped Calls being deductible as original issue discount for tax purposes over the term of the 2028 Notes, which generates an $8.8 million deferred tax asset recognized through equity. The cost to the Company of the Capped Calls was $35 million, which was recorded, net of tax, as a reduction to additional paid-in capital. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION The Company maintains certain stock-based compensation plans that were approved by the Company’s stockholders and are administered by the Board of Directors (the “Board”) or the Compensation and Organization Committee of the Board. The stock-based compensation plans provide for the granting of stock options, restricted stock awards, performance awards, time-based restricted stock units (“RSUs”), performance-based RSUs (“PRSUs”), stock appreciation rights and stock bonuses to employees, non-employee directors, consultants, and service providers. Stock-based Compensation Expense The components and classification of stock-based compensation expense were as follows (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, RSUs and PRSUs $ 5,501 $ 5,956 $ 11,603 $ 10,951 Total stock-based compensation expense $ 5,501 $ 5,956 $ 11,603 $ 10,951 Cost of sales $ 1,155 $ 837 $ 2,262 $ 1,606 Selling, general and administrative 4,085 4,308 8,550 7,853 Research, development and engineering 259 338 728 663 Restructuring and other charges 2 473 63 829 Total stock-based compensation expense $ 5,501 $ 5,956 $ 11,603 $ 10,951 Stock Options The following table summarizes the Company’s stock option activity for the six month period ended June 30, 2023: Number of Weighted Weighted Aggregate Outstanding at December 31, 2022 240,622 $ 38.51 Exercised (68,821) 38.92 Outstanding and exercisable at June 30, 2023 171,801 $ 38.35 3.3 $ 8.1 Time-Based Restricted Stock Units Most RSUs granted to employees during the six months ended June 30, 2023 vest over a period of three years from the grant date, subject to the recipient’s continuous service to the Company. RSUs are issued to members of the Board as a portion of their annual retainer and vest quarterly over a period of one year. The grant-date fair value of all time-based RSUs is equal to the closing market price of Integer common stock on the date of grant. The following table summarizes RSU activity for the six month period ended June 30, 2023: Time-Vested Weighted Nonvested at December 31, 2022 291,929 $ 77.58 Granted 230,782 75.74 Vested (100,648) 79.20 Forfeited (40,091) 71.21 Nonvested at June 30, 2023 381,972 $ 76.71 (7.) STOCK-BASED COMPENSATION (Continued) Performance-Based Restricted Stock Units For the Company’s PRSUs, in addition to service conditions, the ultimate number of shares to be earned depends on the achievement of financial and market-based performance conditions over three year performance periods. The financial performance conditions are based on the Company’s sales targets. The market-based performance conditions are based on the Company’s achievement of a relative total shareholder return performance requirement, on a percentile basis, compared to a defined group of peer companies, or contingent upon achieving specified stock price milestones over a five year performance period. The following table summarizes PRSU activity for the six month period ended June 30, 2023: Performance- Weighted Nonvested at December 31, 2022 263,906 $ 90.29 Granted 105,757 74.32 Vested (24,427) 107.26 Forfeited (62,396) 83.39 Nonvested at June 30, 2023 282,840 $ 84.38 The Company uses a Monte Carlo simulation model to determine the grant-date fair value of awards with market-based performance conditions. The grant-date fair value of all other PRSUs is equal to the closing market price of Integer common stock on the date of grant. The weighted average fair value and assumptions used to value the PRSU awards granted with market-based performance conditions are as follows: Six Months Ended June 30, July 1, Weighted average fair value $ 74.29 $ 97.58 Risk-free interest rate 3.79 % 1.58 % Expected volatility 46 % 42 % Expected life (in years) 3.0 3.9 Expected dividend yield — % — % The valuation of the market-based PRSUs granted during 2023 and 2022 also reflects a weighted average illiquidity discount of 11.23% and 9.25%, respectively, related to the six-month period that recipients are restricted from selling, transferring, pledging or assigning the underlying shares, in the event of vesting. |
RESTRUCTURING AND OTHER CHARGES
RESTRUCTURING AND OTHER CHARGES | 6 Months Ended |
Jun. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND OTHER CHARGES | RESTRUCTURING AND OTHER CHARGES The Company continuously evaluates the business and identifies opportunities to realign its resources to better serve its customers and markets, improve operational efficiency and capabilities, and lower its operating costs or improve profitability. To realize the benefits associated with these opportunities, the Company undertakes restructuring-type activities to transform its business. The Company incurs costs associated with these activities, which primarily include exit and disposal costs and other costs directly related to the restructuring initiative. Exit and disposal costs (“restructuring charges”) are expensed as incurred in accordance with ASC 420, Exit or Disposal Cost Obligations , and are classified within Restructuring and other charges, while other costs directly related to the restructuring initiatives (“restructuring-related charges”) are classified within Cost of sales, Selling, general and administrative, and Research, development and engineering expenses in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). In addition, from time to time, the Company incurs costs associated with acquiring and integrating businesses, and certain other general expenses, including asset impairments. The Company classifies costs associated with these items within Restructuring and other charges in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Restructuring and other charges comprise the following (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Restructuring charges $ 936 $ (5) $ 2,000 $ 1,098 Acquisition and integration costs 556 3,333 938 5,269 Other general expenses 26 205 109 501 Total restructuring and other charges $ 1,518 $ 3,533 $ 3,047 $ 6,868 The following table comprises restructuring and restructuring-related charges by classification in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Restructuring charges: Restructuring and other charges $ 936 $ (5) $ 2,000 $ 1,098 Restructuring-related expenses (a) : Cost of sales 516 179 693 334 Selling, general and administrative 1,346 384 1,587 702 Research, development and engineering 318 326 641 503 Total restructuring and restructuring-related charges $ 3,116 $ 884 $ 4,921 $ 2,637 __________ (a) Restructuring-related expenses primarily include retention bonuses and consulting expenses. (8.) RESTRUCTURING AND OTHER CHARGES (Continued) Restructuring programs Operational excellence initiatives The Company’s operational excellence initiatives mainly consist of costs associated with executing on its sales force, manufacturing, business process and performance excellence operational strategic imperatives. These projects focus on changing the Company’s organizational structure to match product line growth strategies and customer needs, transitioning its manufacturing process into a competitive advantage and standardizing and optimizing its business processes. Strategic reorganization and alignment The Company’s strategic reorganization and alignment initiatives primarily include those that align resources with market conditions and the Company’s strategic direction in order to enhance the profitability of its portfolio of products. Manufacturing alignment to support growth In 2022, the Company commenced initiatives designed to reduce costs and improve operating efficiencies by relocating certain manufacturing operations. The following table summarizes the activity for restructuring reserves (in thousands): Operational Strategic reorganization and alignment Manufacturing alignment to support growth Total December 31, 2022 $ 232 $ 2,134 $ — $ 2,366 Charges incurred, net of reversals 710 979 311 2,000 Cash payments (833) (2,170) — (3,003) June 30, 2023 $ 109 $ 943 $ 311 $ 1,363 Acquisition and integration Acquisition and integration costs primarily consist of professional fees and other costs related to business acquisitions. During the six months ended June 30, 2023 and July 1, 2022, acquisition and integration costs of $0.9 million and $5.3 million, respectively, included expenses primarily related to the acquisitions of Oscor and Aran. Acquisition and integration costs for the six months ended June 30, 2023 and July 1, 2022, included a benefit of $0.3 million and expense of $0.1 million, respectively, to adjust the fair value of acquisition-related contingent consideration liabilities. See Note 13 “Financial Instruments and Fair Value Measurements” for additional information related to the fair value measurement of the contingent consideration. Other general expenses During the six months ended June 30, 2023 and July 1, 2022, the Company recorded expenses related to other initiatives not described above, which relate primarily to integration and operational initiatives to reduce future costs and improve efficiencies. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The income tax provision for interim periods is determined using an estimate of the annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter, the estimate of the annual effective tax rate is updated, and if the estimated effective tax rate changes, a cumulative adjustment is made. There is a potential for volatility of the effective tax rate due to several factors, including discrete items, changes in the mix and amount of pre-tax income and the jurisdictions to which it relates, changes in tax laws and foreign tax holidays, business reorganizations, settlements with taxing authorities and foreign currency fluctuations. In addition, the Company continues to explore tax planning opportunities that may have a material impact on its effective tax rate. The Company’s effective tax rate for the second quarter of 2023 was 19.8% on $29.9 million of income before taxes compared to 14.7% on $24.4 million of income before taxes for the same period in 2022. The Company’s effective tax rate for the six months ended June 30, 2023 was 19.3% on $45.9 million of income before taxes compared to 16.1% on $38.4 million of income before taxes for the same period of 2022. The difference between the Company’s effective tax rates and the U.S. federal statutory income tax rate of 21% for the second quarter and first six months of 2023 and 2022 is due principally to the net impact of the Company’s earnings outside the U.S., which are generally taxed at rates that differ from the U.S federal rate, the Global Intangible Low-Taxed Income (“GILTI”) tax, the Foreign Derived Intangible Income (“FDII”) deduction, the availability of tax credits, and the recognition of certain discrete tax items. For the second quarter and first six months of 2023, the Company recorded discrete tax expense of $0.4 million and $0.5 million, respectively. The Company did not record discrete tax expense for the second quarter of 2022 and recorded discrete tax expense of $0.5 million for the first six months of 2022. The discrete tax expense for the second quarter and first six months of 2023 is predominately related to unfavorable return to provision adjustments attributable to certain foreign tax returns filed during the quarter. The remainder of the discrete tax amounts relate predominately to excess tax benefits recognized upon vesting of RSUs during those periods partially offset by tax expense from shortfalls recorded for the forfeiture of certain PRSUs. The discrete tax amounts for the second quarter and first six months of 2022 are predominately related to tax expense on shortfalls recorded for the forfeiture of certain PRSUs, partially offset by excess tax benefits recognized upon vesting of RSUs during those periods. Unrecognized tax benefits reflect the difference between positions taken or expected to be taken on income tax returns and the amounts reflected in the financial statements. As of June 30, 2023, the Company had unrecognized tax benefits of approximately $8.0 million, of which approximately $7.9 million would favorably impact the effective tax rate, net of federal benefit on state issues, if recognized. As of June 30, 2023, the Company believes it is reasonably possible that a reduction of approximately $1.9 million of the balance of unrecognized tax benefits may occur within the next 12 months as a result of various statute expirations, audit closures, and/or tax settlements. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Contingent Consideration Arrangements The Company records contingent consideration liabilities related to the earn-out provisions for certain acquisitions. See Note 13 “Financial Instruments and Fair Value Measurements” for additional information. Litigation The Company is subject to litigation arising from time to time in the ordinary course of its business. The Company does not expect that the ultimate resolution of any pending legal actions will have a material effect on its consolidated results of operations, financial position, or cash flows. However, litigation is subject to inherent uncertainties. As such, there can be no assurance that any pending legal action, which the Company currently believes to be immaterial, will not become material in the future. Product Warranties The Company generally warrants that its products will meet customer specifications and will be free from defects in materials and workmanship. The product warranty liability is presented within Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets. The change in product warranty liability comprised the following (in thousands): December 31, 2022 $ 77 Additions to warranty reserve, net of reversals 7 June 30, 2023 $ 84 |
EARNINGS PER SHARE (_EPS_)
EARNINGS PER SHARE (“EPS”) | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE (“EPS”) | EARNINGS PER SHARE (“EPS”) The following table sets forth a reconciliation of the information used in computing basic and diluted EPS (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Numerator for basic and diluted EPS: Net income $ 23,971 $ 20,836 $ 37,036 $ 32,203 Denominator for basic and diluted EPS: Weighted average shares outstanding - Basic 33,312 33,111 33,285 33,101 Dilutive effect of share-based awards 374 239 346 225 Weighted average shares outstanding - Diluted 33,686 33,350 33,631 33,326 Basic EPS $ 0.72 $ 0.63 $ 1.11 $ 0.97 Diluted EPS $ 0.71 $ 0.62 $ 1.10 $ 0.97 The diluted weighted average share calculations do not include the following securities, which are not dilutive to the EPS calculations or the performance criteria have not been met (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, RSUs — 5 2 4 PRSUs 83 165 108 165 The dilutive effect for the Company's 2028 Notes is calculated using the if-converted method. The Company is required, pursuant to the Indenture governing the 2028 Notes, to settle the principal amount of the 2028 Notes in cash and may elect to settle the remaining conversion obligation (i.e., the stock price in excess of the conversion price) in cash, shares of the Company's common stock, or a combination thereof. Under the if-converted method, the Company includes the number of shares required to satisfy the conversion obligation, assuming all the 2028 Notes are converted. Because the average closing price of the Company's common stock for the three months ended June 30, 2023, which is used as the basis for determining the dilutive effect on earnings per share, was less than the conversion price of $87.20, all associated shares were antidilutive. In connection with the issuance of the 2028 Notes, the Company entered into privately negotiated capped call transactions with certain financial institutions. The Capped Calls cover, subject to anti-dilution adjustments substantially similar to those in the 2028 Notes, approximately 5.7 million shares of the Company's common stock, the same number of shares initially underlying the 2028 Notes, at a strike price of approximately $108.59, subject to certain adjustments under the terms of the Capped Calls. The Capped Calls will expire upon the maturity of the 2028 Notes, subject to earlier exercise or termination. Exercise of the Capped Calls would reduce the number of shares of the Company's common stock outstanding, and therefore would be antidilutive. See Note 6 “Debt” for additional information related to 2028 Notes and Capped Calls. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY Common Stock The following is a summary of the number of shares of common stock issued, treasury stock and common stock outstanding for the six month periods ended June 30, 2023 and July 1, 2022: Six Months Ended June 30, July 1, Shares outstanding at beginning of period 33,169,778 33,063,336 Stock options exercised 58,413 — Vesting of RSUs, net of shares withheld to cover taxes 79,889 58,497 Shares outstanding at end of period 33,308,080 33,121,833 Accumulated Other Comprehensive Income Accumulated other comprehensive income (“AOCI”) comprises the following (in thousands): Defined Cash Foreign Total Tax Net-of-Tax March 31, 2023 $ (346) $ 3,927 $ 12,075 $ 15,656 $ (690) $ 14,966 Unrealized gain on cash flow hedges — 2,126 — 2,126 (447) 1,679 Realized gain on foreign currency hedges — (1,318) — (1,318) 277 (1,041) Realized gain on interest rate swap hedge — (675) — (675) 142 (533) Foreign currency translation loss — — (2,901) (2,901) — (2,901) June 30, 2023 $ (346) $ 4,060 $ 9,174 $ 12,888 $ (718) $ 12,170 December 31, 2022 $ (346) $ 1,760 $ 4,150 $ 5,564 $ (235) $ 5,329 Unrealized gain on cash flow hedges — 5,572 — 5,572 (1,170) 4,402 Realized gain on foreign currency hedges — (2,010) — (2,010) 422 (1,588) Realized gain on interest rate swap hedge — (1,262) — (1,262) 265 (997) Foreign currency translation gain — — 5,024 5,024 — 5,024 June 30, 2023 $ (346) $ 4,060 $ 9,174 $ 12,888 $ (718) $ 12,170 April 1, 2022 $ (890) $ 1,170 $ 21,833 $ 22,113 $ (76) $ 22,037 Unrealized loss on cash flow hedges — (291) — (291) 61 (230) Realized gain on foreign currency hedges — (295) — (295) 62 (233) Realized loss on interest rate swap hedge — 526 — 526 (110) 416 Foreign currency translation loss — — (27,274) (27,274) — (27,274) July 1, 2022 $ (890) $ 1,110 $ (5,441) $ (5,221) $ (63) $ (5,284) December 31, 2021 $ (890) $ (2,291) $ 29,720 $ 26,539 $ 651 $ 27,190 Unrealized gain on cash flow hedges — 2,565 — 2,565 (539) 2,026 Realized gain on foreign currency hedges — (457) — (457) 96 (361) Realized loss on interest rate swap hedge — 1,293 — 1,293 (271) 1,022 Foreign currency translation loss — — (35,161) (35,161) — (35,161) July 1, 2022 $ (890) $ 1,110 $ (5,441) $ (5,221) $ (63) $ (5,284) |
FINANCIAL INSTRUMENTS AND FAIR
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS Assets and Liabilities Measured at Fair Value on a Recurring Basis Fair value measurement standards apply to certain financial assets and liabilities that are measured at fair value on a recurring basis (each reporting period). For the Company, these financial assets and liabilities include its derivative instruments and contingent consideration. The Company does not have any nonfinancial assets or liabilities that are measured at fair value on a recurring basis. The Company is exposed to global market risks, including the effect of changes in interest rates and foreign currency exchange rates, and may use derivatives to manage these exposures that occur in the normal course of business. The Company does not hold or issue derivatives for trading or speculative purposes. All derivatives are recorded at fair value on the Condensed Consolidated Balance Sheets. The following tables provide information regarding assets and liabilities recorded at fair value on a recurring basis (in thousands): Fair Value Quoted Significant Significant June 30, 2023 Assets: Foreign currency hedging contracts $ 4,060 $ — $ 4,060 $ — Liabilities: Contingent consideration 555 — — 555 December 31, 2022 Assets: Interest rate swap $ 1,262 $ — $ 1,262 $ — Assets: Foreign currency hedging contracts 521 — 521 — Liabilities: Foreign currency hedging contracts 23 23 Liabilities: Contingent consideration 11,756 — — 11,756 Derivatives Designated as Hedging Instruments Interest Rate Swaps The Company may periodically enter into interest rate swap agreements in order to reduce the cash flow risk caused by interest rate changes on its outstanding floating rate borrowings. Under these swap agreements, the Company pays a fixed rate of interest and receives a floating rate. The Company had no outstanding interest rate swaps as of June 30, 2023. Information regarding the Company’s outstanding interest rate swap, designated as a cash flow hedge, as of December 31, 2022 is as follows (dollars in thousands): Notional Amount Maturity Date Pay Fixed Rate Receive Current Floating Rate Fair Value Balance Sheet Location $ 100,000 Jun 2023 2.1785 % 4.3869 % $ 1,262 Prepaid expenses and other current assets (13.) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued) Foreign Currency Contracts The Company periodically enters into foreign currency forward contracts to hedge its exposure to foreign currency exchange rate fluctuations in its international operations. The Company has designated these foreign currency forward contracts as cash flow hedges. Information regarding outstanding foreign currency forward contracts designated as cash flow hedges as of June 30, 2023 is as follows (dollars in thousands): Notional Amount Maturity Date $/Foreign Currency Fair Value Balance Sheet Location $ 18,289 Dec 2023 0.0481 MXN Peso $ 3,436 Prepaid expenses and other current assets 40,377 Dec 2023 1.0796 Euro 624 Prepaid expenses and other current assets Information regarding outstanding foreign currency forward contracts designated as cash flow hedges as of December 31, 2022 is as follows (dollars in thousands): Notional Amount Maturity Date $/Foreign Currency Fair Value Balance Sheet Location $ 37,175 Dec 2023 0.0489 MXN Peso $ 504 Prepaid expenses and other current assets 2,685 Mar 2023 0.0249 UYU Peso 17 Prepaid expenses and other current assets 17,309 Mar 2023 1.0751 Euro (23) Accrued expenses and other current liabilities The following tables present the effect of cash flow hedge derivative instruments on other comprehensive income (loss) (“OCI”), AOCI and the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and six months ended June 30, 2023 and July 1, 2022 (in thousands): Three Months Ended June 30, 2023 July 1, 2022 Total Amount of Gain (Loss) on Cash Flow Hedge Activity Total Amount of Gain (Loss) on Cash Flow Hedge Activity Sales $ 400,044 $ (83) $ 350,081 $ (371) Cost of sales 294,240 1,384 257,184 554 Operating expenses 64,228 17 60,190 112 Interest expense 11,459 675 7,773 (526) Six Months Ended June 30, 2023 July 1, 2022 Total Amount of Gain (Loss) on Cash Flow Hedge Activity Total Amount of Gain (Loss) on Cash Flow Hedge Activity Sales $ 778,829 $ (134) $ 660,993 $ (425) Cost of sales 576,352 2,092 486,621 746 Operating expenses 126,735 52 119,168 136 Interest expense 28,713 1,262 13,741 (1,293) (13.) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued) Unrealized Gain (Loss) Recognized in OCI Realized Gain (Loss) Reclassified from AOCI Three Months Ended Location in Statements of Operations and Comprehensive Income (Loss) Three Months Ended June 30, July 1, June 30, July 1, Interest rate swap $ 6 $ 702 Interest expense $ 675 $ (526) Foreign exchange contracts 364 (1,167) Sales (83) (371) Foreign exchange contracts 1,739 96 Cost of sales 1,384 554 Foreign exchange contracts 17 78 Operating expenses 17 112 Six Months Ended Location in Statements of Operations and Comprehensive Income (Loss) Six Months Ended June 30, July 1, June 30, July 1, Interest rate swap $ — $ 2,526 Interest expense $ 1,262 $ (1,293) Foreign exchange contracts 513 (1,681) Sales (134) (425) Foreign exchange contracts 5,014 1,365 Cost of sales 2,092 746 Foreign exchange contracts 45 355 Operating expenses 52 136 The Company expects to reclassify net gains totaling $4.1 million related to its cash flow hedges from AOCI into earnings during the next twelve months. Net Investment Hedges The Company has foreign-denominated long-term debt balances that qualify as net investment hedges. Changes in the value of these net investment hedges due to foreign currency gains or losses are deferred as foreign currency translation adjustments in Other comprehensive income (loss) on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), and will remain in Accumulated other comprehensive income (loss) until the hedged investment is sold or substantially liquidated. We evaluate the effectiveness of the net investment hedges each quarter. As of June 30, 2023, the Company had a €100 million borrowing on the Revolving Credit Facility that was designated as a net investment hedge on a portion of the Company’s net investments in certain of its entities with functional currencies denominated in the Euro. There were no net investment hedges outstanding at December 31, 2022. Derivatives Not Designated as Hedging Instruments The Company also has foreign currency exposure on balances, primarily intercompany, that are denominated in a foreign currency and are adjusted to current values using period-end exchange rates. To minimize foreign currency exposure, the Company enters into foreign currency contracts with a one month maturity. At June 30, 2023 and December 31, 2022, the Company had total gross notional amounts of $15.0 million and $12.0 million, respectively, of foreign currency contracts outstanding that were not designated as hedges. The fair value of derivatives not designated as hedges was not material for any period presented. Net gains/losses on foreign currency contracts not designated as hedging instruments are included in Other loss, net on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The Company recorded net losses of approximately $0.1 million for the three and six months ended June 30, 2023, compared to gains of $0.4 million and $0.7 million, respectively, for the three and six months ended July 1, 2022, respectively. Each of the foreign currency contracts not designated as hedging instruments will have approximately offsetting effects from the underlying intercompany loans subject to foreign exchange remeasurement. (13.) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued) Contingent Consideration The following table presents the changes in the estimated fair values of the Company’s liabilities for contingent consideration measured using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2023 and July 1, 2022 (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Fair value measurement at beginning of period $ 11,732 $ 1,976 $ 11,756 $ 2,415 Amount recorded for current year acquisitions — 7,375 — 7,375 Fair value measurement adjustment — — (265) 54 Payments (11,177) — (11,177) (493) Foreign currency translation — (279) 241 (279) Fair value measurement at end of period $ 555 $ 9,072 $ 555 $ 9,072 On October 7, 2019, the Company acquired certain assets and liabilities of US BioDesign, LLC (“USB”), a privately-held developer and manufacturer of complex braided biomedical structures for disposable and implantable medical devices. As of June 30, 2023 and December 31, 2022, the Company assessed the probability of meeting the required revenue threshold as unlikely and determined the fair value of the contingent consideration liability relating to the acquisition of USB was zero. The final earnout period under the asset purchase agreement for USB ends on December 31, 2023. During the six months ended July 1, 2022, the Company made a $0.5 million payment associated with the USB acquisition, resulting from achievement of revenue-based goals for the period from January 1, 2021 to December 31, 2021. On February 19, 2020, the Company acquired certain assets and liabilities of InoMec Ltd. (“InoMec”), a privately-held company based in Israel that specializes in the research, development and manufacturing of medical devices, including minimally invasive tools, delivery systems, tubing and catheters, surgery tools, drug-device combination, laser combined devices, and tooling and production. As of June 30, 2023 and December 31, 2022, the fair value of the contingent consideration liability relating to the acquisition of InoMec was $0.6 million and $1.1 million, respectively. During the six months ended June 30, 2023, the Company made a $0.3 million payment associated with the InoMec acquisition, resulting from achievement of revenue-based goals for the period from March 1, 2022 to February 28, 2023. The final earnout period under the asset purchase agreement for InoMec ends on February 29, 2024. The remaining maximum potential undiscounted payout for the contingent consideration liability relating to the acquisition of InoMec is $0.9 million . On April 6, 2022, the Company acquired Aran. See Note 2 “Business Acquisitions” for additional information about the Aran acquisition and related contingent consideration. During the six months ended June 30, 2023, the Company made a $10.9 million payment associated with the final earnout period under the asset purchase agreement for Aran , resulting from achievement of the maximum revenue-based goals for the year ended December 31, 2022 . As of December 31, 2022, the fair value of the contingent consideration liability relating to the acquisition of Aran was $10.9 million. The contingent consideration at June 30, 2023 is the estimated fair value of the Company’s remaining obligations under the asset purchase agreements for InoMec and USB. As of June 30, 2023, contingent consideration liabilities of $0.6 million are included in Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets. As of December 31, 2022, the current portion of contingent consideration liabilities included in Accrued expenses and other current liabilities was $11.2 million and the non-current portion included in Other long-term liabilities was $0.6 million. (13.) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued) Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Fair value standards also apply to certain assets and liabilities that are measured at fair value on a nonrecurring basis. The carrying amounts of cash, accounts receivable, accounts payable, and accrued expenses approximate fair value because of the short-term nature of these items. Borrowings under the Company’s Revolving Credit Facility and TLA Facility accrue interest at a floating rate tied to a standard short-term borrowing index, selected at the Company’s option, plus an applicable margin. The carrying amount of this floating rate debt approximates fair value based upon the respective interest rates adjusting with market rate adjustments. Equity Investments The Company holds long-term, strategic investments in companies to promote business and strategic objectives. These investments are included in Other long-term assets on the Condensed Consolidated Balance Sheets. Equity investments comprise the following (in thousands): June 30, December 31, Equity method investment $ 8,231 $ 8,252 Non-marketable equity securities 5,637 5,637 Total equity investments $ 13,868 $ 13,889 The components of (Gain) loss on equity investments for each period were as follows (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Equity method investment (gain) loss $ (134) $ 320 $ 21 $ 2,724 The Company’s equity method investment is in a venture capital fund focused on investing in life sciences companies. As of June 30, 2023, the Company owned 7.4% of this fund. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION The Company organizes its business into two reportable segments: (1) Medical and (2) Non-Medical. This segment structure reflects the financial information and reports used by the Company’s management, specifically its Chief Operating Decision Maker, to make decisions regarding the Company’s business, including resource allocations and performance assessments. This segment structure reflects the Company’s current operating focus in compliance with ASC 280, Segment Reporting . For purposes of segment reporting, intercompany sales between segments are not material. The following table presents sales by product line (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Segment sales by product line: Medical Cardio & Vascular $ 208,494 $ 180,604 $ 399,697 $ 339,641 Cardiac Rhythm Management & Neuromodulation 153,411 135,945 298,550 259,269 Advanced Surgical, Orthopedics & Portable Medical 27,206 23,285 55,130 42,951 Total Medical 389,111 339,834 753,377 641,861 Non-Medical 10,933 10,247 25,452 19,132 Total sales $ 400,044 $ 350,081 $ 778,829 $ 660,993 The following table presents income for the Company’s reportable segments (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Segment income: Medical $ 68,497 $ 54,580 $ 123,303 $ 98,728 Non-Medical 278 1,625 4,304 2,290 Total segment income 68,775 56,205 127,607 101,018 Unallocated operating expenses (27,199) (23,498) (51,865) (45,814) Operating income 41,576 32,707 75,742 55,204 Unallocated expenses, net (11,684) (8,284) (29,853) (16,833) Income before taxes $ 29,892 $ 24,423 $ 45,889 $ 38,371 |
REVENUE FROM CONTRACTS WITH CUS
REVENUE FROM CONTRACTS WITH CUSTOMERS | 6 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | REVENUE FROM CONTRACTS WITH CUSTOMERS Disaggregated Revenue In general, the Company’s business segmentation is aligned according to the nature and economic characteristics of its products and customer relationships and provides meaningful disaggregation of each business segment’s results of operations. For a summary by disaggregated product line sales for each segment, refer to Note 14, “Segment Information.” Revenue recognized from products and services transferred to customers over time represented 27% of total revenue for the three and six months ended June 30, 2023, compared to 32% and 31%, respectively, for the three and six months ended July 1, 2022. Substantially all of the revenue recognized from products and services transferred to customers over time during the periods presented was within the Medical segment. The following tables present revenues by significant customers, which are defined as any customer who individually represents 10% or more of a segment’s total revenues. Three Months Ended June 30, 2023 July 1, 2022 Customer Medical Non-Medical Medical Non-Medical Customer A 17% * 18% * Customer B 17% * 17% * Customer C 13% * 14% * Customer D * 20% * 42% All other customers 53% 80% 51% 58% Six Months Ended June 30, 2023 July 1, 2022 Customer Medical Non-Medical Medical Non-Medical Customer A 18% * 18% * Customer B 17% * 17% * Customer C 13% * 14% * Customer D * 21% * 37% All other customers 52% 79% 51% 63% __________ * Less than 10% of segment’s total revenues for the period. (15.) REVENUE FROM CONTRACTS WITH CUSTOMERS (Continued) The following tables present revenues by significant ship to location, which is defined as any country where 10% or more of a segment’s total revenues are shipped. Three Months Ended June 30, 2023 July 1, 2022 Ship to Location Medical Non-Medical Medical Non-Medical United States 54% 64% 52% 71% Canada * 12% * * All other countries 46% 24% 48% 29% Six Months Ended June 30, 2023 July 1, 2022 Ship to Location Medical Non-Medical Medical Non-Medical United States 54% 62% 51% 67% Canada * 11% * * All other countries 46% 27% 49% 33% __________ * Less than 10% of segment’s total revenues for the period. Contract Balances The opening and closing balances of the Company’s contract assets and contract liabilities are as follows (in thousands): June 30, December 31, Contract assets $ 80,010 $ 71,927 Contract liabilities 8,777 5,616 During the three and six months ended June 30, 2023, the Company recognized $1.3 million and $2.7 million, respectively, of revenue that was included in the contract liability balance as of December 31, 2022. During the three and six months ended July 1, 2022, the Company recognized $0.8 million and $1.7 million, respectively, of revenue that was included in the contract liability balance as of December 31, 2021. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Pay vs Performance Disclosure | ||||
Net income | $ 23,971 | $ 20,836 | $ 37,036 | $ 32,203 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jun. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Interim Basis of Accounting | In the opinion of management, the condensed consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the results of the Company for the periods presented. The results for interim periods are not necessarily indicative of results or trends that may be expected for the fiscal year as a whole. The condensed consolidated financial statements were prepared using U.S. GAAP, which require management to make estimates and assumptions that affect the reported amounts of assets, liabilities, certain components of equity, sales, expenses, and related disclosures at the date of the financial statements and during the reporting period. Actual results could differ materially from these estimates. |
Trade Accounts Receivable - Factoring Arrangements | Trade Accounts Receivable - Factoring Arrangements In the second quarter of 2023, the Company entered into a receivables factoring arrangement, pursuant to which certain receivables may be sold to a financial institution without recourse in exchange for cash. Transactions under the receivables factoring arrangement are accounted for as sales under ASC 860, Transfers and Servicing of Financial Assets |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company considers the applicability and impact of all Accounting Standard Updates (“ASU”) issued by the Financial Accounting Standards Board (“FASB”). The Company evaluated all recent accounting pronouncements issued, including those that are currently effective, and determined that the adoption of these pronouncements would not have a material effect on the financial position, results of operations or cash flows of the Company. There have been no new or material changes to the significant accounting policies discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, that are of significance, or potential significance, to the Company. |
Income Taxes | The income tax provision for interim periods is determined using an estimate of the annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter, the estimate of the annual effective tax rate is updated, and if the estimated effective tax rate changes, a cumulative adjustment is made. There is a potential for volatility of the effective tax rate due to several factors, including discrete items, changes in the mix and amount of pre-tax income and the jurisdictions to which it relates, changes in tax laws and foreign tax holidays, business reorganizations, settlements with taxing authorities and foreign currency fluctuations. In addition, the Company continues to explore tax planning opportunities that may have a material impact on its effective tax rate. |
Equity Investments | Equity Investments The Company holds long-term, strategic investments in companies to promote business and strategic objectives. These investments are included in Other long-term assets on the Condensed Consolidated Balance Sheets. |
BUSINESS ACQUISITIONS (Tables)
BUSINESS ACQUISITIONS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Final Allocation of Purchase Consideration | The following table summarizes the final fair values of the assets acquired and liabilities assumed (in thousands): Fair value of net assets acquired Current assets $ 9,319 Property, plant and equipment 4,151 Goodwill 68,460 Definite-lived intangible assets 71,485 Operating lease assets 3,505 Other noncurrent assets 1,354 Current liabilities (4,370) Operating lease liabilities (3,258) Other noncurrent liabilities (9,377) Fair value of net assets acquired $ 141,269 |
Schedule of Business Acquisition, Pro Forma Information | These pro forma results do not purport to be indicative of the results that would have been obtained, or to be a projection of results that may be obtained in the future. Three Months Ended July 1, 2022 Six Months Ended July 1, 2022 Sales $ 350,081 $ 666,356 Net income 22,101 34,228 |
SUPPLEMENTAL CASH FLOW INFORM_2
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | The following is supplemental information relating to the Condensed Consolidated Statements of Cash Flows (in thousands): Six Months Ended June 30, July 1, Noncash investing and financing activities: Property, plant and equipment purchases included in accounts payable $ 9,059 $ 6,373 Supplemental lease disclosures: Assets acquired under operating leases 912 11,265 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories comprise the following (in thousands): June 30, December 31, Raw materials $ 102,280 $ 98,640 Work-in-process 112,887 98,188 Finished goods 13,764 11,938 Total $ 228,931 $ 208,766 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill by reportable segment for the six months ended June 30, 2023 were as follows (in thousands): Medical Non- Medical Total December 31, 2022 $ 965,192 $ 17,000 $ 982,192 Foreign currency translation 3,790 — 3,790 June 30, 2023 $ 968,982 $ 17,000 $ 985,982 |
Schedule of Finite-Lived Intangible Assets, Major Class | Intangible assets comprise the following (in thousands): Gross Accumulated Net June 30, 2023 Definite-lived: Purchased technology and patents $ 284,921 $ (187,279) $ 97,642 Customer lists 829,550 (234,506) 595,044 Amortizing tradenames and other 21,012 (6,392) 14,620 Total amortizing intangible assets $ 1,135,483 $ (428,177) $ 707,306 Indefinite-lived: Trademarks and tradenames $ 90,288 December 31, 2022 Definite-lived: Purchased technology and patents $ 283,929 $ (178,844) $ 105,085 Customer lists 825,634 (216,546) 609,088 Amortizing tradenames and other 21,028 (5,600) 15,428 Total amortizing intangible assets $ 1,130,591 $ (400,990) $ 729,601 Indefinite-lived: Trademarks and tradenames $ 90,288 |
Schedule of Indefinite-Lived Intangible Assets | Intangible assets comprise the following (in thousands): Gross Accumulated Net June 30, 2023 Definite-lived: Purchased technology and patents $ 284,921 $ (187,279) $ 97,642 Customer lists 829,550 (234,506) 595,044 Amortizing tradenames and other 21,012 (6,392) 14,620 Total amortizing intangible assets $ 1,135,483 $ (428,177) $ 707,306 Indefinite-lived: Trademarks and tradenames $ 90,288 December 31, 2022 Definite-lived: Purchased technology and patents $ 283,929 $ (178,844) $ 105,085 Customer lists 825,634 (216,546) 609,088 Amortizing tradenames and other 21,028 (5,600) 15,428 Total amortizing intangible assets $ 1,130,591 $ (400,990) $ 729,601 Indefinite-lived: Trademarks and tradenames $ 90,288 |
Schedule of Finite-Lived Intangible Assets, Amortization Expense | Aggregate intangible asset amortization expense comprises the following (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Cost of sales $ 4,037 $ 4,037 $ 8,014 $ 7,682 Selling, general and administrative expenses 9,070 8,248 18,017 16,207 Total intangible asset amortization expense $ 13,107 $ 12,285 $ 26,031 $ 23,889 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Estimated future intangible asset amortization expense based on the carrying value as of June 30, 2023 is as follows (in thousands): Remainder of 2023 2024 2025 2026 2027 After 2027 Amortization Expense $ 26,368 $ 51,803 $ 51,014 $ 49,189 $ 46,232 $ 482,700 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Long-term debt comprises the following (in thousands): June 30, 2023 December 31, 2022 Principal Amount UnamortizedDiscounts and Issuance Costs Net Carrying Amount Principal Amount UnamortizedDiscounts and Issuance Costs Net Carrying Amount Senior Secured Credit Facilities: Revolving credit facilities $ 108,640 $ — $ 108,640 $ 140,300 $ — $ 140,300 Term loan A 392,500 (1,958) 390,542 455,313 (2,172) 453,141 Term loan B — — — 335,625 (3,805) 331,820 Convertible Senior Notes due 2028 500,000 (13,784) 486,216 — — — Total $ 1,001,140 $ (15,742) $ 985,398 $ 931,238 $ (5,977) $ 925,261 Current portion of long-term debt (5,000) (18,188) Long-term debt $ 980,398 $ 907,073 |
Schedule of Deferred Financing Costs | Deferred Debt Issuance Costs and Discounts The change in deferred debt issuance costs related to the Company’s Revolving Credit Facility is as follows (in thousands): December 31, 2022 $ 2,387 Financing costs incurred 579 Write-off of deferred debt issuance costs (260) Amortization during the period (271) June 30, 2023 $ 2,435 The change in unamortized discount and deferred debt issuance costs related to the Term Loan Facilities is as follows (in thousands): Deferred Debt Issuance Costs Unamortized Discount on TLB Facility Total December 31, 2022 $ 4,569 $ 1,408 $ 5,977 Financing costs incurred 418 — 418 Write-off of deferred debt issuance costs and unamortized discount (2,780) (1,391) (4,171) Amortization during the period (249) (17) (266) June 30, 2023 $ 1,958 $ — $ 1,958 |
Schedule of Maturities of Long-term Debt | Contractual maturities under the Senior Secured Credit Facilities for the remainder of 2023 and through maturity, excluding any discounts or premiums, as of June 30, 2023 are as follows (in thousands): Remainder of 2023 2024 2025 2026 2027 After 2027 Future minimum principal payments $ — $ 10,000 $ 17,500 $ 27,500 $ 30,000 $ 416,140 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Employee Service Share-Based Compensation, Allocation of Recognized Period Costs | The components and classification of stock-based compensation expense were as follows (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, RSUs and PRSUs $ 5,501 $ 5,956 $ 11,603 $ 10,951 Total stock-based compensation expense $ 5,501 $ 5,956 $ 11,603 $ 10,951 Cost of sales $ 1,155 $ 837 $ 2,262 $ 1,606 Selling, general and administrative 4,085 4,308 8,550 7,853 Research, development and engineering 259 338 728 663 Restructuring and other charges 2 473 63 829 Total stock-based compensation expense $ 5,501 $ 5,956 $ 11,603 $ 10,951 |
Schedule of Share-Based Compensation, Stock Options Activity | The following table summarizes the Company’s stock option activity for the six month period ended June 30, 2023: Number of Weighted Weighted Aggregate Outstanding at December 31, 2022 240,622 $ 38.51 Exercised (68,821) 38.92 Outstanding and exercisable at June 30, 2023 171,801 $ 38.35 3.3 $ 8.1 |
Schedule of Share-Based Compensation, Restricted Stock and Restricted Stock Units Activity | The following table summarizes RSU activity for the six month period ended June 30, 2023: Time-Vested Weighted Nonvested at December 31, 2022 291,929 $ 77.58 Granted 230,782 75.74 Vested (100,648) 79.20 Forfeited (40,091) 71.21 Nonvested at June 30, 2023 381,972 $ 76.71 The following table summarizes PRSU activity for the six month period ended June 30, 2023: Performance- Weighted Nonvested at December 31, 2022 263,906 $ 90.29 Granted 105,757 74.32 Vested (24,427) 107.26 Forfeited (62,396) 83.39 Nonvested at June 30, 2023 282,840 $ 84.38 |
Schedule of Share-Based Payment Award, Stock Options, Valuation Assumptions | The weighted average fair value and assumptions used to value the PRSU awards granted with market-based performance conditions are as follows: Six Months Ended June 30, July 1, Weighted average fair value $ 74.29 $ 97.58 Risk-free interest rate 3.79 % 1.58 % Expected volatility 46 % 42 % Expected life (in years) 3.0 3.9 Expected dividend yield — % — % |
RESTRUCTURING AND OTHER CHARG_2
RESTRUCTURING AND OTHER CHARGES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring and Related Charges | Restructuring and other charges comprise the following (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Restructuring charges $ 936 $ (5) $ 2,000 $ 1,098 Acquisition and integration costs 556 3,333 938 5,269 Other general expenses 26 205 109 501 Total restructuring and other charges $ 1,518 $ 3,533 $ 3,047 $ 6,868 The following table comprises restructuring and restructuring-related charges by classification in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Restructuring charges: Restructuring and other charges $ 936 $ (5) $ 2,000 $ 1,098 Restructuring-related expenses (a) : Cost of sales 516 179 693 334 Selling, general and administrative 1,346 384 1,587 702 Research, development and engineering 318 326 641 503 Total restructuring and restructuring-related charges $ 3,116 $ 884 $ 4,921 $ 2,637 __________ (a) Restructuring-related expenses primarily include retention bonuses and consulting expenses. |
Schedule of Changes in Restructuring Reserves | The following table summarizes the activity for restructuring reserves (in thousands): Operational Strategic reorganization and alignment Manufacturing alignment to support growth Total December 31, 2022 $ 232 $ 2,134 $ — $ 2,366 Charges incurred, net of reversals 710 979 311 2,000 Cash payments (833) (2,170) — (3,003) June 30, 2023 $ 109 $ 943 $ 311 $ 1,363 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Product Warranty Liability | The change in product warranty liability comprised the following (in thousands): December 31, 2022 $ 77 Additions to warranty reserve, net of reversals 7 June 30, 2023 $ 84 |
EARNINGS PER SHARE (_EPS_) (Tab
EARNINGS PER SHARE (“EPS”) (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Numerator and Denominator in Earnings Per Share | The following table sets forth a reconciliation of the information used in computing basic and diluted EPS (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Numerator for basic and diluted EPS: Net income $ 23,971 $ 20,836 $ 37,036 $ 32,203 Denominator for basic and diluted EPS: Weighted average shares outstanding - Basic 33,312 33,111 33,285 33,101 Dilutive effect of share-based awards 374 239 346 225 Weighted average shares outstanding - Diluted 33,686 33,350 33,631 33,326 Basic EPS $ 0.72 $ 0.63 $ 1.11 $ 0.97 Diluted EPS $ 0.71 $ 0.62 $ 1.10 $ 0.97 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The diluted weighted average share calculations do not include the following securities, which are not dilutive to the EPS calculations or the performance criteria have not been met (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, RSUs — 5 2 4 PRSUs 83 165 108 165 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
Schedule of Common Stock Outstanding Roll Forward | The following is a summary of the number of shares of common stock issued, treasury stock and common stock outstanding for the six month periods ended June 30, 2023 and July 1, 2022: Six Months Ended June 30, July 1, Shares outstanding at beginning of period 33,169,778 33,063,336 Stock options exercised 58,413 — Vesting of RSUs, net of shares withheld to cover taxes 79,889 58,497 Shares outstanding at end of period 33,308,080 33,121,833 |
Schedule of Accumulated Other Comprehensive Income (Loss) | Accumulated other comprehensive income (“AOCI”) comprises the following (in thousands): Defined Cash Foreign Total Tax Net-of-Tax March 31, 2023 $ (346) $ 3,927 $ 12,075 $ 15,656 $ (690) $ 14,966 Unrealized gain on cash flow hedges — 2,126 — 2,126 (447) 1,679 Realized gain on foreign currency hedges — (1,318) — (1,318) 277 (1,041) Realized gain on interest rate swap hedge — (675) — (675) 142 (533) Foreign currency translation loss — — (2,901) (2,901) — (2,901) June 30, 2023 $ (346) $ 4,060 $ 9,174 $ 12,888 $ (718) $ 12,170 December 31, 2022 $ (346) $ 1,760 $ 4,150 $ 5,564 $ (235) $ 5,329 Unrealized gain on cash flow hedges — 5,572 — 5,572 (1,170) 4,402 Realized gain on foreign currency hedges — (2,010) — (2,010) 422 (1,588) Realized gain on interest rate swap hedge — (1,262) — (1,262) 265 (997) Foreign currency translation gain — — 5,024 5,024 — 5,024 June 30, 2023 $ (346) $ 4,060 $ 9,174 $ 12,888 $ (718) $ 12,170 April 1, 2022 $ (890) $ 1,170 $ 21,833 $ 22,113 $ (76) $ 22,037 Unrealized loss on cash flow hedges — (291) — (291) 61 (230) Realized gain on foreign currency hedges — (295) — (295) 62 (233) Realized loss on interest rate swap hedge — 526 — 526 (110) 416 Foreign currency translation loss — — (27,274) (27,274) — (27,274) July 1, 2022 $ (890) $ 1,110 $ (5,441) $ (5,221) $ (63) $ (5,284) December 31, 2021 $ (890) $ (2,291) $ 29,720 $ 26,539 $ 651 $ 27,190 Unrealized gain on cash flow hedges — 2,565 — 2,565 (539) 2,026 Realized gain on foreign currency hedges — (457) — (457) 96 (361) Realized loss on interest rate swap hedge — 1,293 — 1,293 (271) 1,022 Foreign currency translation loss — — (35,161) (35,161) — (35,161) July 1, 2022 $ (890) $ 1,110 $ (5,441) $ (5,221) $ (63) $ (5,284) |
FINANCIAL INSTRUMENTS AND FAI_2
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables provide information regarding assets and liabilities recorded at fair value on a recurring basis (in thousands): Fair Value Quoted Significant Significant June 30, 2023 Assets: Foreign currency hedging contracts $ 4,060 $ — $ 4,060 $ — Liabilities: Contingent consideration 555 — — 555 December 31, 2022 Assets: Interest rate swap $ 1,262 $ — $ 1,262 $ — Assets: Foreign currency hedging contracts 521 — 521 — Liabilities: Foreign currency hedging contracts 23 23 Liabilities: Contingent consideration 11,756 — — 11,756 Notional Amount Maturity Date Pay Fixed Rate Receive Current Floating Rate Fair Value Balance Sheet Location $ 100,000 Jun 2023 2.1785 % 4.3869 % $ 1,262 Prepaid expenses and other current assets Information regarding outstanding foreign currency forward contracts designated as cash flow hedges as of June 30, 2023 is as follows (dollars in thousands): Notional Amount Maturity Date $/Foreign Currency Fair Value Balance Sheet Location $ 18,289 Dec 2023 0.0481 MXN Peso $ 3,436 Prepaid expenses and other current assets 40,377 Dec 2023 1.0796 Euro 624 Prepaid expenses and other current assets Information regarding outstanding foreign currency forward contracts designated as cash flow hedges as of December 31, 2022 is as follows (dollars in thousands): Notional Amount Maturity Date $/Foreign Currency Fair Value Balance Sheet Location $ 37,175 Dec 2023 0.0489 MXN Peso $ 504 Prepaid expenses and other current assets 2,685 Mar 2023 0.0249 UYU Peso 17 Prepaid expenses and other current assets 17,309 Mar 2023 1.0751 Euro (23) Accrued expenses and other current liabilities |
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | The following tables present the effect of cash flow hedge derivative instruments on other comprehensive income (loss) (“OCI”), AOCI and the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and six months ended June 30, 2023 and July 1, 2022 (in thousands): Three Months Ended June 30, 2023 July 1, 2022 Total Amount of Gain (Loss) on Cash Flow Hedge Activity Total Amount of Gain (Loss) on Cash Flow Hedge Activity Sales $ 400,044 $ (83) $ 350,081 $ (371) Cost of sales 294,240 1,384 257,184 554 Operating expenses 64,228 17 60,190 112 Interest expense 11,459 675 7,773 (526) Six Months Ended June 30, 2023 July 1, 2022 Total Amount of Gain (Loss) on Cash Flow Hedge Activity Total Amount of Gain (Loss) on Cash Flow Hedge Activity Sales $ 778,829 $ (134) $ 660,993 $ (425) Cost of sales 576,352 2,092 486,621 746 Operating expenses 126,735 52 119,168 136 Interest expense 28,713 1,262 13,741 (1,293) Unrealized Gain (Loss) Recognized in OCI Realized Gain (Loss) Reclassified from AOCI Three Months Ended Location in Statements of Operations and Comprehensive Income (Loss) Three Months Ended June 30, July 1, June 30, July 1, Interest rate swap $ 6 $ 702 Interest expense $ 675 $ (526) Foreign exchange contracts 364 (1,167) Sales (83) (371) Foreign exchange contracts 1,739 96 Cost of sales 1,384 554 Foreign exchange contracts 17 78 Operating expenses 17 112 Six Months Ended Location in Statements of Operations and Comprehensive Income (Loss) Six Months Ended June 30, July 1, June 30, July 1, Interest rate swap $ — $ 2,526 Interest expense $ 1,262 $ (1,293) Foreign exchange contracts 513 (1,681) Sales (134) (425) Foreign exchange contracts 5,014 1,365 Cost of sales 2,092 746 Foreign exchange contracts 45 355 Operating expenses 52 136 |
Schedule of Estimated Fair Values for Contingent Consideration | The following table presents the changes in the estimated fair values of the Company’s liabilities for contingent consideration measured using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2023 and July 1, 2022 (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Fair value measurement at beginning of period $ 11,732 $ 1,976 $ 11,756 $ 2,415 Amount recorded for current year acquisitions — 7,375 — 7,375 Fair value measurement adjustment — — (265) 54 Payments (11,177) — (11,177) (493) Foreign currency translation — (279) 241 (279) Fair value measurement at end of period $ 555 $ 9,072 $ 555 $ 9,072 |
Schedule of Equity Method Investments | Equity investments comprise the following (in thousands): June 30, December 31, Equity method investment $ 8,231 $ 8,252 Non-marketable equity securities 5,637 5,637 Total equity investments $ 13,868 $ 13,889 The components of (Gain) loss on equity investments for each period were as follows (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Equity method investment (gain) loss $ (134) $ 320 $ 21 $ 2,724 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Reconciliation of Revenue from Segments to Consolidated | The following table presents sales by product line (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Segment sales by product line: Medical Cardio & Vascular $ 208,494 $ 180,604 $ 399,697 $ 339,641 Cardiac Rhythm Management & Neuromodulation 153,411 135,945 298,550 259,269 Advanced Surgical, Orthopedics & Portable Medical 27,206 23,285 55,130 42,951 Total Medical 389,111 339,834 753,377 641,861 Non-Medical 10,933 10,247 25,452 19,132 Total sales $ 400,044 $ 350,081 $ 778,829 $ 660,993 |
Schedule of Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The following table presents income for the Company’s reportable segments (in thousands): Three Months Ended Six Months Ended June 30, July 1, June 30, July 1, Segment income: Medical $ 68,497 $ 54,580 $ 123,303 $ 98,728 Non-Medical 278 1,625 4,304 2,290 Total segment income 68,775 56,205 127,607 101,018 Unallocated operating expenses (27,199) (23,498) (51,865) (45,814) Operating income 41,576 32,707 75,742 55,204 Unallocated expenses, net (11,684) (8,284) (29,853) (16,833) Income before taxes $ 29,892 $ 24,423 $ 45,889 $ 38,371 |
REVENUE FROM CONTRACTS WITH C_2
REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenue by Major Customers by Reporting Segments | The following tables present revenues by significant customers, which are defined as any customer who individually represents 10% or more of a segment’s total revenues. Three Months Ended June 30, 2023 July 1, 2022 Customer Medical Non-Medical Medical Non-Medical Customer A 17% * 18% * Customer B 17% * 17% * Customer C 13% * 14% * Customer D * 20% * 42% All other customers 53% 80% 51% 58% Six Months Ended June 30, 2023 July 1, 2022 Customer Medical Non-Medical Medical Non-Medical Customer A 18% * 18% * Customer B 17% * 17% * Customer C 13% * 14% * Customer D * 21% * 37% All other customers 52% 79% 51% 63% __________ * Less than 10% of segment’s total revenues for the period. |
Schedule of Revenue by Ship To Location | The following tables present revenues by significant ship to location, which is defined as any country where 10% or more of a segment’s total revenues are shipped. Three Months Ended June 30, 2023 July 1, 2022 Ship to Location Medical Non-Medical Medical Non-Medical United States 54% 64% 52% 71% Canada * 12% * * All other countries 46% 24% 48% 29% Six Months Ended June 30, 2023 July 1, 2022 Ship to Location Medical Non-Medical Medical Non-Medical United States 54% 62% 51% 67% Canada * 11% * * All other countries 46% 27% 49% 33% __________ * Less than 10% of segment’s total revenues for the period. |
Schedule of Contract with Customer, Asset and Liability | The opening and closing balances of the Company’s contract assets and contract liabilities are as follows (in thousands): June 30, December 31, Contract assets $ 80,010 $ 71,927 Contract liabilities 8,777 5,616 |
BASIS OF PRESENTATION (Details)
BASIS OF PRESENTATION (Details) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2023 USD ($) | Jun. 30, 2023 USD ($) | |
Accounting Policies [Abstract] | ||
Amount of accounts receivable sold | $ 50.3 | $ 50.3 |
Factoring fee | $ 0.4 | $ 0.4 |
BUSINESS ACQUISITIONS (Narrativ
BUSINESS ACQUISITIONS (Narrative) (Details) € in Millions | 3 Months Ended | 6 Months Ended | ||||
Apr. 06, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jul. 01, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jul. 01, 2022 USD ($) | Apr. 06, 2022 EUR (€) | |
Business Acquisition [Line Items] | ||||||
Net of cash acquired | $ 0 | $ 126,636,000 | ||||
Aran Acquisition | ||||||
Business Acquisition [Line Items] | ||||||
Percentage of voting interests acquired | 100% | 100% | ||||
Consideration transferred | $ 141,300,000 | |||||
Payments to acquire business | 133,900,000 | 10,900,000 | ||||
Net of cash acquired | 129,300,000 | |||||
Fair value of contingent consideration | 7,400,000 | |||||
Contingent consideration liability, current | $ 10,900,000 | € 10 | ||||
Oscor Inc | ||||||
Business Acquisition [Line Items] | ||||||
Acquisition related costs | $ 0 | $ 1,500,000 | $ 0 | $ 2,300,000 |
BUSINESS ACQUISITIONS (Allocati
BUSINESS ACQUISITIONS (Allocation Of The Provisional Purchase Price) (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 | Apr. 06, 2022 |
Business Acquisition [Line Items] | |||
Goodwill | $ 985,982 | $ 982,192 | |
Aran Acquisition | |||
Business Acquisition [Line Items] | |||
Current assets | $ 9,319 | ||
Property, plant and equipment | 4,151 | ||
Goodwill | 68,460 | ||
Definite-lived intangible assets | 71,485 | ||
Operating lease assets | 3,505 | ||
Other noncurrent assets | 1,354 | ||
Current liabilities | (4,370) | ||
Operating lease liabilities | (3,258) | ||
Other noncurrent liabilities | (9,377) | ||
Fair value of net assets acquired | $ 141,269 |
BUSINESS ACQUISITIONS (Pro Form
BUSINESS ACQUISITIONS (Pro Forma Information) (Details) - Oscor Inc - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jul. 01, 2022 | Jul. 01, 2022 | |
Business Combination, Separately Recognized Transactions [Line Items] | ||
Sales | $ 350,081 | $ 666,356 |
Net income | $ 22,101 | $ 34,228 |
SUPPLEMENTAL CASH FLOW INFORM_3
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Noncash investing and financing activities: | ||
Property, plant and equipment purchases included in accounts payable | $ 9,059 | $ 6,373 |
Supplemental lease disclosures: | ||
Assets acquired under operating leases | $ 912 | $ 11,265 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 102,280 | $ 98,640 |
Work-in-process | 112,887 | 98,188 |
Finished goods | 13,764 | 11,938 |
Total | $ 228,931 | $ 208,766 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Schedule of Goodwill) (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Goodwill [Roll Forward] | |
Opening goodwill | $ 982,192 |
Foreign currency translation | 3,790 |
Closing goodwill | 985,982 |
Medical | |
Goodwill [Roll Forward] | |
Opening goodwill | 965,192 |
Foreign currency translation | 3,790 |
Closing goodwill | 968,982 |
Non-Medical | |
Goodwill [Roll Forward] | |
Opening goodwill | 17,000 |
Foreign currency translation | 0 |
Closing goodwill | $ 17,000 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Schedule of Definite-Lived and Indefinite-Lived Intangible Assets, Major Class) (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,135,483 | $ 1,130,591 |
Accumulated Amortization | (428,177) | (400,990) |
Net Carrying Amount | 707,306 | 729,601 |
Trademarks and tradenames | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived | 90,288 | 90,288 |
Purchased technology and patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 284,921 | 283,929 |
Accumulated Amortization | (187,279) | (178,844) |
Net Carrying Amount | 97,642 | 105,085 |
Customer lists | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 829,550 | 825,634 |
Accumulated Amortization | (234,506) | (216,546) |
Net Carrying Amount | 595,044 | 609,088 |
Amortizing tradenames and other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 21,012 | 21,028 |
Accumulated Amortization | (6,392) | (5,600) |
Net Carrying Amount | $ 14,620 | $ 15,428 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Schedule of Finite-Lived Intangible Assets, Amortization Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible asset amortization expense | $ 13,107 | $ 12,285 | $ 26,031 | $ 23,889 |
Cost of sales | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible asset amortization expense | 4,037 | 4,037 | 8,014 | 7,682 |
Selling, general and administrative | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total intangible asset amortization expense | $ 9,070 | $ 8,248 | $ 18,017 | $ 16,207 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Schedule of Finite-Lived Intangible Assets, Future Amortization Expense) (Details) $ in Thousands | Jun. 30, 2023 USD ($) |
Amortization Expense | |
Remainder of 2023 | $ 26,368 |
2024 | 51,803 |
2025 | 51,014 |
2026 | 49,189 |
2027 | 46,232 |
After 2027 | $ 482,700 |
DEBT (Schedule of Long-Term Deb
DEBT (Schedule of Long-Term Debt) (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Feb. 28, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | |||
Principal Amount | $ 1,001,140 | $ 931,238 | |
UnamortizedDiscounts and Issuance Costs | (15,742) | (5,977) | |
Net Carrying Amount | 985,398 | 925,261 | |
Current portion of long-term debt | (5,000) | (18,188) | |
Long-term debt | 980,398 | 907,073 | |
Convertible Debt | 2028 Convertible Senior Notes | |||
Debt Instrument [Line Items] | |||
Net Carrying Amount | $ 65,000 | ||
Revolving Credit Facility | Line of Credit | |||
Debt Instrument [Line Items] | |||
Principal Amount | 108,640 | 140,300 | |
UnamortizedDiscounts and Issuance Costs | 0 | 0 | |
Net Carrying Amount | 108,640 | 140,300 | |
Secured Debt | Loans Payable | Term Loan A (TLA) Facility | |||
Debt Instrument [Line Items] | |||
Principal Amount | 392,500 | 455,313 | |
UnamortizedDiscounts and Issuance Costs | (1,958) | (2,172) | |
Net Carrying Amount | 390,542 | 453,141 | |
Secured Debt | Loans Payable | Term Loan B (TLB) Facility | |||
Debt Instrument [Line Items] | |||
Principal Amount | 0 | 335,625 | |
UnamortizedDiscounts and Issuance Costs | 0 | (3,805) | |
Net Carrying Amount | 0 | 331,820 | |
Secured Debt | Convertible Debt | 2028 Convertible Senior Notes | |||
Debt Instrument [Line Items] | |||
Principal Amount | 500,000 | 0 | |
UnamortizedDiscounts and Issuance Costs | (13,784) | 0 | |
Net Carrying Amount | $ 486,216 | $ 0 |
DEBT (Narrative) (Details)
DEBT (Narrative) (Details) $ / shares in Units, shares in Millions | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Feb. 15, 2023 USD ($) | Feb. 03, 2023 | Sep. 02, 2021 | Feb. 28, 2023 USD ($) d $ / shares shares | Jun. 30, 2023 USD ($) $ / shares | Dec. 31, 2022 USD ($) | Feb. 14, 2023 USD ($) | Jan. 31, 2023 $ / shares | Jan. 30, 2023 USD ($) | |
Debt Instrument [Line Items] | |||||||||
Debt issuance costs, net | $ 15,742,000 | $ 5,977,000 | |||||||
Long-term debt | $ 985,398,000 | $ 925,261,000 | |||||||
Conversion premium on share price (in dollars per share) | $ / shares | $ 65.81 | ||||||||
Capped Call Options | |||||||||
Debt Instrument [Line Items] | |||||||||
Capped call (in shares) | shares | 5.7 | ||||||||
Capped Call Options | |||||||||
Debt Instrument [Line Items] | |||||||||
Conversion price (in dollars per share) | $ / shares | $ 108.59 | ||||||||
Capped call (in shares) | shares | 5.7 | ||||||||
Deferred tax assets | $ 8,800,000 | ||||||||
Derivative, cost of hedge | 35,000,000 | ||||||||
Secured Debt | Term Loan A (TLA) Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument term | 5 years | ||||||||
Debt weighted average interest rate | 6.70% | ||||||||
Debt issuance costs, net | $ 1,958,000 | $ 5,977,000 | |||||||
Write off of debt issuance cost | 2,780,000 | ||||||||
Secured Debt | Term Loan B (TLB) Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument term | 7 years | ||||||||
Discount percentage | 0.50% | ||||||||
Write off of debt issuance cost | 3,800,000 | ||||||||
Secured Debt | Revolving Credit Facility And Term Loan A (TLA) Faility | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt issuance costs, net | 3,800,000 | ||||||||
Write off of debt issuance cost | $ 600,000 | ||||||||
Convertible Debt | 2028 Convertible Senior Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt principal payments | 500,000,000 | ||||||||
Long-term debt | $ 65,000,000 | ||||||||
Stated interest rate | 2.125% | ||||||||
Convertible debt | $ 485,000,000 | ||||||||
Conversion price (in dollars per share) | $ / shares | $ 87.20 | $ 87.20 | |||||||
Conversion premium interest rate | 0.325 | ||||||||
Trading days | d | 20 | ||||||||
Consecutive trading days | d | 30 | ||||||||
Percentage of stock price | 130% | ||||||||
Number of preceding days | 2 days | ||||||||
Redemption price, percentage | 100% | ||||||||
Percent of holders to declare debt and interest immediately payable | 25% | ||||||||
Effective Interest rate | 2.76% | ||||||||
Conversion ratio | 0.0114681 | ||||||||
Convertible Debt | 2028 Convertible Senior Notes | Significant Other Observable Inputs (Level 2) | |||||||||
Debt Instrument [Line Items] | |||||||||
Fair value | $ 593,000,000 | ||||||||
Convertible Debt | 2028 Convertible Senior Notes | Measurement Period | |||||||||
Debt Instrument [Line Items] | |||||||||
Trading days | d | 5 | ||||||||
Consecutive trading days | d | 10 | ||||||||
Percentage of stock price | 98% | ||||||||
Revolving Credit Facility | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument term | 5 years | ||||||||
Line of credit facility, maximum borrowing capacity | $ 500,000,000 | $ 400,000,000 | $ 600,000,000 | ||||||
Increase in maximum borrowing capacity | $ 100,000,000 | ||||||||
Borrowing capacity sublimit percentage | 50% | ||||||||
Remaining borrowing capacity | 387,900,000 | ||||||||
Outstanding borrowings | $ 108,600,000 | ||||||||
Commitment fee on unused portion | 0.18% | ||||||||
Debt weighted average interest rate | 4.92% | ||||||||
Debt issuance costs | $ 1,000,000 | ||||||||
Debt issuance costs, net | $ 0 | $ 0 | |||||||
Write off of debt issuance cost | 260,000 | ||||||||
Long-term debt | $ 108,640,000 | 140,300,000 | |||||||
Revolving Credit Facility | Line of Credit | Minimum | |||||||||
Debt Instrument [Line Items] | |||||||||
Commitment fee on unused portion | 0.15% | ||||||||
Revolving Credit Facility | Line of Credit | Maximum | |||||||||
Debt Instrument [Line Items] | |||||||||
Commitment fee on unused portion | 0.25% | ||||||||
Revolving Credit Facility | Line of Credit | Adjusted Term Secured Overnight Financing Rate (SOFT) | |||||||||
Debt Instrument [Line Items] | |||||||||
Variable rate basis spread | 0.10% | ||||||||
Revolving Credit Facility | Line of Credit | Term Loan A (TLA) Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of credit facility, maximum borrowing capacity | $ 400,000,000 | ||||||||
Revolving Credit Facility | Secured Debt | Term Loan A (TLA) Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest expense ratio | 2.50 | ||||||||
Revolving Credit Facility | Secured Debt | Term Loan A (TLA) Facility | Through Maturity | |||||||||
Debt Instrument [Line Items] | |||||||||
Net leverage ratio incremental increase option | 5.50 | ||||||||
Revolving Credit Facility | Secured Debt | Term Loan A (TLA) Facility | Third Fiscal Quarter of 2023 | |||||||||
Debt Instrument [Line Items] | |||||||||
Net leverage ratio incremental increase option | 5 | ||||||||
Standby Letters of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Letters of credit outstanding amount | $ 3,500,000 |
Debt (Schedule of Deferred Fina
Debt (Schedule of Deferred Financing Costs) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Debt Instrument [Line Items] | ||
Total, beginning balance | $ 5,977 | |
Total, Amortization during the period | (6,118) | $ (962) |
Total, ending balance | 15,742 | |
Line of Credit | Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Debt issuance costs, beginning balance | 2,387 | |
Financing costs incurred | 579 | |
Write-off of debt issuance costs and unamortized discount | (260) | |
Amortization during the period | (271) | |
Debt issuance costs, ending balance | 2,435 | |
Total, beginning balance | 0 | |
Total, ending balance | 0 | |
Secured Debt | Term Loan A (TLA) Facility | ||
Debt Instrument [Line Items] | ||
Debt issuance costs, beginning balance | 4,569 | |
Financing costs incurred | 418 | |
Write-off of debt issuance costs and unamortized discount | (2,780) | |
Amortization during the period | (249) | |
Debt issuance costs, ending balance | 1,958 | |
Unamortized discount on TLB Facility, beginning balance | 1,408 | |
Unamortized discount on TLB Facility, Financing costs incurred | 0 | |
Unamortized discount on TLB Facility, Write-off during the period | (1,391) | |
Unamortized discount on TLB Facility, Amortization during the period | (17) | |
Unamortized discount on TLB Facility, ending balance | 0 | |
Total, beginning balance | 5,977 | |
Total, Financing costs incurred | 418 | |
Total, Write-off during the period | (4,171) | |
Total, Amortization during the period | (266) | |
Total, ending balance | $ 1,958 |
DEBT (Long-term Debt Maturity S
DEBT (Long-term Debt Maturity Schedule) (Details) $ in Thousands | Jun. 30, 2023 USD ($) |
Debt Disclosure [Abstract] | |
Remainder of 2023 | $ 0 |
2024 | 10,000 |
2025 | 17,500 |
2026 | 27,500 |
2027 | 30,000 |
After 2027 | $ 416,140 |
STOCK-BASED COMPENSATION (Alloc
STOCK-BASED COMPENSATION (Allocation of Recognized Period Costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based payment arrangement, expense | $ 5,501 | $ 5,956 | $ 11,603 | $ 10,951 |
Cost of sales | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based payment arrangement, expense | 1,155 | 837 | 2,262 | 1,606 |
Selling, general and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based payment arrangement, expense | 4,085 | 4,308 | 8,550 | 7,853 |
Research, development and engineering | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based payment arrangement, expense | 259 | 338 | 728 | 663 |
Restructuring and other charges | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based payment arrangement, expense | 2 | 473 | 63 | 829 |
RSUs and PRSUs | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based payment arrangement, expense | $ 5,501 | $ 5,956 | $ 11,603 | $ 10,951 |
STOCK-BASED COMPENSATION (Stock
STOCK-BASED COMPENSATION (Stock Options Activity) (Details) $ / shares in Units, $ in Millions | 6 Months Ended |
Jun. 30, 2023 USD ($) $ / shares shares | |
Number of Stock Options | |
Options outstanding, beginning balance (in shares) | shares | 240,622 |
Exercised (in shares) | shares | (68,821) |
Options outstanding, ending balance (in shares) | shares | 171,801 |
Options exercisable at period end (in shares ) | shares | 171,801 |
Weighted Average Exercise Price | |
Options outstanding, beginning (in dollars per share) | $ / shares | $ 38.51 |
Exercised (in dollars per share) | $ / shares | 38.92 |
Options outstanding, ending (in dollars per share) | $ / shares | 38.35 |
Options exercisable at period end (in dollars per share) | $ / shares | $ 38.35 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |
Options Outstanding, Weighted Average Remaining Contractual Life | 3 years 3 months 18 days |
Options Exercisable, Aggregate Intrinsic Value | $ | $ 8.1 |
STOCK-BASED COMPENSATION (Narra
STOCK-BASED COMPENSATION (Narrative) (Details) | 6 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
RSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Requisite service period | 3 years | |
RSUs | Director | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Requisite service period | 1 year | |
PRSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Requisite service period | 3 years | |
Performance period | 5 years | |
Weighted average illiquidity discount | 11.23% | 9.25% |
Restriction period | 6 months | 6 months |
STOCK-BASED COMPENSATION (Restr
STOCK-BASED COMPENSATION (Restricted Stock and Restricted Stock Units Activity) (Details) | 6 Months Ended |
Jun. 30, 2023 $ / shares shares | |
RSUs | |
Time-Vested and Performance-Vested Activity | |
Nonvested, beginning (in shares) | shares | 291,929 |
Granted (in shares) | shares | 230,782 |
Vested (in shares) | shares | (100,648) |
Forfeited (in shares) | shares | (40,091) |
Nonvested, ending (in shares) | shares | 381,972 |
Weighted Average Grant Date Fair Value | |
Nonvested, beginning (in dollars per share) | $ / shares | $ 77.58 |
Granted (in dollars per share) | $ / shares | 75.74 |
Vested (in dollars per share) | $ / shares | 79.20 |
Forfeited (in dollars per share) | $ / shares | 71.21 |
Nonvested, ending (in dollars per share) | $ / shares | $ 76.71 |
PRSUs | |
Time-Vested and Performance-Vested Activity | |
Nonvested, beginning (in shares) | shares | 263,906 |
Granted (in shares) | shares | 105,757 |
Vested (in shares) | shares | (24,427) |
Forfeited (in shares) | shares | (62,396) |
Nonvested, ending (in shares) | shares | 282,840 |
Weighted Average Grant Date Fair Value | |
Nonvested, beginning (in dollars per share) | $ / shares | $ 90.29 |
Granted (in dollars per share) | $ / shares | 74.32 |
Vested (in dollars per share) | $ / shares | 107.26 |
Forfeited (in dollars per share) | $ / shares | 83.39 |
Nonvested, ending (in dollars per share) | $ / shares | $ 84.38 |
STOCK-BASED COMPENSATION (Valua
STOCK-BASED COMPENSATION (Valuation Assumptions) (Details) - PRSUs - $ / shares | 6 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average fair value (in dollars per share) | $ 74.29 | $ 97.58 |
Risk-free interest rate | 3.79% | 1.58% |
Expected volatility | 46% | 42% |
Expected life (in years) | 3 years | 3 years 10 months 24 days |
Expected dividend yield | 0% | 0% |
RESTRUCTURING AND OTHER CHARG_3
RESTRUCTURING AND OTHER CHARGES (Schedule of Restructuring And Other Charges Components) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Restructuring and Related Activities [Abstract] | ||||
Restructuring charges | $ 936 | $ (5) | $ 2,000 | $ 1,098 |
Acquisition and integration costs | 556 | 3,333 | 938 | 5,269 |
Other general expenses | 26 | 205 | 109 | 501 |
Total restructuring and other charges | $ 1,518 | $ 3,533 | $ 3,047 | $ 6,868 |
RESTRUCTURING AND OTHER CHARG_4
RESTRUCTURING AND OTHER CHARGES (Schedule of Restructuring Restructuring-Related Costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Restructuring charges: | ||||
Restructuring and other charges | $ 936 | $ (5) | $ 2,000 | $ 1,098 |
Total restructuring and restructuring-related charges | 3,116 | 884 | 4,921 | 2,637 |
Cost of sales | ||||
Restructuring charges: | ||||
Total restructuring and restructuring-related charges | 516 | 179 | 693 | 334 |
Selling, general and administrative | ||||
Restructuring charges: | ||||
Total restructuring and restructuring-related charges | 1,346 | 384 | 1,587 | 702 |
Research, development and engineering | ||||
Restructuring charges: | ||||
Total restructuring and restructuring-related charges | $ 318 | $ 326 | $ 641 | $ 503 |
RESTRUCTURING AND OTHER CHARG_5
RESTRUCTURING AND OTHER CHARGES (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Restructuring Cost and Reserve [Line Items] | ||||
Acquisition and integration costs | $ 556 | $ 3,333 | $ 938 | $ 5,269 |
Oscor And Aran Acquisitions | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Acquisition and integration costs | 900 | 5,300 | ||
(Benefit) expense to adjust the fair value of acquisition related contingent consideration | $ (300) | $ 100 |
RESTRUCTURING AND OTHER CHARG_6
RESTRUCTURING AND OTHER CHARGES (Schedule of Restructuring Reserve By Type of Cost) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Restructuring Reserve [Roll Forward] | ||||
Beginning balance | $ 2,366 | |||
Charges incurred, net of reversals | $ 936 | $ (5) | 2,000 | $ 1,098 |
Cash payments | (3,003) | |||
Ending balance | 1,363 | 1,363 | ||
Operational excellence initiatives | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning balance | 232 | |||
Charges incurred, net of reversals | 710 | |||
Cash payments | (833) | |||
Ending balance | 109 | 109 | ||
Strategic reorganization and alignment | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning balance | 2,134 | |||
Charges incurred, net of reversals | 979 | |||
Cash payments | (2,170) | |||
Ending balance | 943 | 943 | ||
Manufacturing alignment to support growth | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning balance | 0 | |||
Charges incurred, net of reversals | 311 | |||
Cash payments | 0 | |||
Ending balance | $ 311 | $ 311 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 19.80% | 14.70% | 19.30% | 16.10% |
Income before provision for income taxes | $ 29,892 | $ 24,423 | $ 45,889 | $ 38,371 |
Discrete tax benefits | 400 | $ 500 | 500 | |
Unrecognized tax benefits | 8,000 | 8,000 | ||
Unrecognized tax benefits that would impact effective tax rate | 7,900 | 7,900 | ||
Significant change in unrecognized tax benefits is reasonably possible, amount of unrecorded benefit | $ 1,900 | $ 1,900 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Schedule of Product Warranty Liability) (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Movement in Standard Product Warranty Accrual [Roll Forward] | |
Balance at beginning of period | $ 77 |
Additions to warranty reserve, net of reversals | 7 |
Balance at end of period | $ 84 |
EARNINGS PER SHARE (_EPS_) (Det
EARNINGS PER SHARE (“EPS”) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | Feb. 28, 2023 | |
Numerator for basic and diluted EPS: | |||||
Net income | $ 23,971 | $ 20,836 | $ 37,036 | $ 32,203 | |
Denominator for basic and diluted EPS: | |||||
Weighted average shares outstanding - Basic (in shares) | 33,312 | 33,111 | 33,285 | 33,101 | |
Dilutive effect of share-based awards (in shares) | 374 | 239 | 346 | 225 | |
Weighted average shares outstanding - Diluted (in shares) | 33,686 | 33,350 | 33,631 | 33,326 | |
Basic EPS (in dollars per share) | $ 0.72 | $ 0.63 | $ 1.11 | $ 0.97 | |
Diluted EPS (in dollars per share) | 0.71 | $ 0.62 | 1.10 | $ 0.97 | |
Capped Call Options | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Conversion price (in dollars per share) | $ 108.59 | ||||
Capped call (in shares) | 5,700 | ||||
Strike price (in dollars per share) | 108.59 | ||||
2028 Convertible Senior Notes | Convertible Debt | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Conversion price (in dollars per share) | $ 87.20 | $ 87.20 | $ 87.20 | ||
RSUs | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Securities excluded from calculation of earnings per share (in shares) | 0 | 5 | 2 | 4 | |
PRSUs | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Securities excluded from calculation of earnings per share (in shares) | 83 | 165 | 108 | 165 | |
Capped Call Options | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Capped call (in shares) | 5,700 |
STOCKHOLDERS' EQUITY (Shares Is
STOCKHOLDERS' EQUITY (Shares Issued and Outstanding) (Details) - shares | 6 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Class Of Stock [Roll Forward] | ||
Shares outstanding at beginning of period (in shares) | 33,169,778 | |
Shares outstanding at ending of period (in shares) | 33,308,080 | |
Common Stock | ||
Class Of Stock [Roll Forward] | ||
Shares outstanding at beginning of period (in shares) | 33,169,778 | 33,063,336 |
Stock options exercised (in shares) | 58,413 | 0 |
Shares outstanding at ending of period (in shares) | 33,308,080 | 33,121,833 |
Restricted Stock | Common Stock | ||
Class Of Stock [Roll Forward] | ||
Vesting of RSUs, net of shares withheld to cover taxes (in shares) | 79,889 | 58,497 |
STOCKHOLDERS' EQUITY (Accumulat
STOCKHOLDERS' EQUITY (Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | $ 1,417,936 | $ 1,364,350 | $ 1,417,456 | $ 1,354,697 |
Unrealized gain (loss) on cash flow hedges | 1,679 | (230) | 4,402 | 2,026 |
Balance, ending balance | 1,445,655 | 1,363,451 | 1,445,655 | 1,363,451 |
Foreign exchange contracts | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Unrealized gain (loss) on cash flow hedges | (1,041) | (233) | (1,588) | (361) |
Interest rate swap | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Unrealized gain (loss) on cash flow hedges | (533) | 416 | (997) | 1,022 |
Defined Benefit Plan Liability | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | (346) | (890) | (346) | (890) |
Balance, ending balance | (346) | (890) | (346) | (890) |
Cash Flow Hedges | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | 3,927 | 1,170 | 1,760 | (2,291) |
Reclassification from AOCI, before tax | 2,126 | (291) | 5,572 | 2,565 |
Reclassification from AOCI, tax | (447) | 61 | (1,170) | (539) |
Balance, ending balance | 4,060 | 1,110 | 4,060 | 1,110 |
Cash Flow Hedges | Foreign exchange contracts | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Reclassification from AOCI, before tax | (1,318) | (295) | (2,010) | (457) |
Reclassification from AOCI, tax | 277 | 62 | 422 | 96 |
Cash Flow Hedges | Interest rate swap | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Reclassification from AOCI, before tax | (675) | 526 | (1,262) | 1,293 |
Reclassification from AOCI, tax | 142 | (110) | 265 | (271) |
Foreign Currency Translation Adjustment | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | 12,075 | 21,833 | 4,150 | 29,720 |
Reclassification from AOCI, before tax | (2,901) | (27,274) | 5,024 | (35,161) |
Reclassification from AOCI, tax | 0 | 0 | 0 | 0 |
Unrealized gain (loss) on cash flow hedges | (2,901) | (27,274) | 5,024 | (35,161) |
Balance, ending balance | 9,174 | (5,441) | 9,174 | (5,441) |
Total Pre-Tax Amount | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | 15,656 | 22,113 | 5,564 | 26,539 |
Balance, ending balance | 12,888 | (5,221) | 12,888 | (5,221) |
Tax | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | (690) | (76) | (235) | 651 |
Balance, ending balance | (718) | (63) | (718) | (63) |
Net-of-Tax Amount | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | 14,966 | 22,037 | 5,329 | 27,190 |
Balance, ending balance | $ 12,170 | $ (5,284) | $ 12,170 | $ (5,284) |
FINANCIAL INSTRUMENTS AND FAI_3
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Assets and Liabilities Recorded at Fair Value on a Recurring Basis) (Details) - Fair Value - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets: Interest rate swap | $ 1,262 | |
Assets: Foreign currency hedging contracts | $ 4,060 | 521 |
Liabilities: Foreign currency hedging contracts | 23 | |
Liabilities: Contingent consideration | 555 | 11,756 |
Quoted Prices in Active Markets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets: Interest rate swap | 0 | |
Assets: Foreign currency hedging contracts | 0 | 0 |
Liabilities: Foreign currency hedging contracts | ||
Liabilities: Contingent consideration | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets: Interest rate swap | 1,262 | |
Assets: Foreign currency hedging contracts | 4,060 | 521 |
Liabilities: Foreign currency hedging contracts | 23 | |
Liabilities: Contingent consideration | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets: Interest rate swap | 0 | |
Assets: Foreign currency hedging contracts | 0 | 0 |
Liabilities: Foreign currency hedging contracts | ||
Liabilities: Contingent consideration | $ 555 | $ 11,756 |
FINANCIAL INSTRUMENTS AND FAI_4
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Schedule of Interest Rate Swaps) (Details) - Interest Rate Swap Maturing June 2023 - Prepaid expenses and other current assets | Dec. 31, 2022 USD ($) |
Derivatives, Fair Value [Line Items] | |
Notional Amount | $ 100,000,000 |
Pay Fixed Rate | 2.1785% |
Receive Current Floating Rate | 4.3869% |
Fair Value | $ 1,262,000 |
FINANCIAL INSTRUMENTS AND FAI_5
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Schedule of Foreign Currency Contracts) (Details) - Designated as Hedging Instrument $ in Thousands | Jun. 30, 2023 USD ($) $ / $ $ / € | Dec. 31, 2022 USD ($) $ / $ $ / $ $ / € |
Foreign Exchange Contract Maturing December Two Thousand Twenty Three, Contract One | Prepaid expenses and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 18,289 | |
$/Foreign currency (in dollars per foreign currency) | $ / $ | 0.0481 | |
Fair Value | $ 3,436 | |
Foreign Exchange Contract Maturing September Two Thousand Twenty Three, Contract | Prepaid expenses and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 40,377 | |
$/Foreign currency (in dollars per foreign currency) | $ / € | 1.0796 | |
Fair Value | $ 624 | |
Foreign Exchange Contract Maturing December Two Thousand Twenty Three, Contract Two | Prepaid expenses and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 37,175 | |
$/Foreign currency (in dollars per foreign currency) | $ / $ | 0.0489 | |
Fair Value | $ 504 | |
Foreign Exchange Contract Maturing March Two Thousand Twenty Three, Contract Two | Prepaid expenses and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 2,685 | |
$/Foreign currency (in dollars per foreign currency) | $ / € | 0.0249 | |
Fair Value | $ 17 | |
Foreign Exchange Contract Maturing March Two Thousand Twenty Three, Contract Three | Accrued expenses and other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 17,309 | |
$/Foreign currency (in dollars per foreign currency) | $ / $ | 1.0751 | |
Fair Value | $ (23) |
FINANCIAL INSTRUMENTS AND FAI_6
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Impact of Cash Flow Hedges on Other Comprehensive Income (Loss), AOCI and the Condensed Consolidated Statements of Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Total sales | $ 400,044 | $ 350,081 | $ 778,829 | $ 660,993 |
Cost of sales | 294,240 | 257,184 | 576,352 | 486,621 |
Operating expenses | 64,228 | 60,190 | 126,735 | 119,168 |
Interest expense | 11,459 | 7,773 | 28,713 | 13,741 |
Sales | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Amount of Gain (Loss) on Cash Flow Hedge Activity | (83) | (371) | (134) | (425) |
Sales | Foreign exchange contracts | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Unrealized Gain (Loss) Recognized in OCI | 364 | (1,167) | 513 | (1,681) |
Cost of sales | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Amount of Gain (Loss) on Cash Flow Hedge Activity | 1,384 | 554 | 2,092 | 746 |
Cost of sales | Foreign exchange contracts | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Unrealized Gain (Loss) Recognized in OCI | 1,739 | 96 | 5,014 | 1,365 |
Operating expenses | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Amount of Gain (Loss) on Cash Flow Hedge Activity | 17 | 112 | 52 | 136 |
Operating expenses | Foreign exchange contracts | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Unrealized Gain (Loss) Recognized in OCI | 17 | 78 | 45 | 355 |
Interest expense | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Amount of Gain (Loss) on Cash Flow Hedge Activity | 675 | (526) | 1,262 | (1,293) |
Interest expense | Interest rate swap | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Unrealized Gain (Loss) Recognized in OCI | $ 6 | $ 702 | $ 0 | $ 2,526 |
FINANCIAL INSTRUMENTS AND FAI_7
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Narrative) (Details) | 3 Months Ended | 6 Months Ended | ||||||
Apr. 06, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jul. 01, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jul. 01, 2022 USD ($) | Jun. 30, 2023 EUR (€) | Dec. 31, 2022 USD ($) | Apr. 06, 2022 EUR (€) | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||||||
Derivative instruments net loss to be reclassified to net income during next twelve months | $ 4,100,000 | |||||||
Chinese Venture Capital Fund | ||||||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||||||
Equity method investment ownership | 7.40% | 7.40% | 7.40% | |||||
Accrued expenses and other current liabilities | ||||||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||||||
Contingent consideration liability, current | $ 600,000 | $ 600,000 | $ 11,200,000 | |||||
Prepaid expenses and other current assets | ||||||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||||||
Contingent consideration liability, noncurrent | 600,000 | 600,000 | 600,000 | |||||
USB Acquisition | ||||||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||||||
Liabilities: contingent consideration | 0 | 0 | 0 | |||||
Consideration transferred | $ 500,000 | |||||||
InoMec Ltd | ||||||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||||||
Liabilities: contingent consideration | 600,000 | 600,000 | 1,100,000 | |||||
Payments to acquire business | 300,000 | |||||||
Contingent consideration, range of outcomes, value, high | 900,000 | 900,000 | ||||||
Aran Acquisition | ||||||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||||||
Liabilities: contingent consideration | 10,900,000 | |||||||
Consideration transferred | $ 141,300,000 | |||||||
Payments to acquire business | 133,900,000 | 10,900,000 | ||||||
Contingent consideration liability, current | $ 10,900,000 | € 10,000,000 | ||||||
Designated as Hedging Instrument | Revolving Credit Facility | ||||||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||||||
Outstanding borrowings | € | € 100,000,000 | |||||||
Foreign exchange contracts | Not Designated as Hedging Instrument | ||||||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||||||
National amount | 15,000,000 | 15,000,000 | $ 12,000,000 | |||||
Unrealized gain on cash flow hedges, pretax | $ 100,000 | $ 400,000 | $ 100,000 | $ 700,000 |
FINANCIAL INSTRUMENTS AND FAI_8
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Estimated Fair Values for Contingent Consideration) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Fair value measurement at beginning of period | $ 11,732 | $ 1,976 | $ 11,756 | $ 2,415 |
Amount recorded for current year acquisitions | 0 | 7,375 | 0 | 7,375 |
Fair value measurement adjustment | 0 | 0 | (265) | 54 |
Payments | (11,177) | 0 | (11,177) | (493) |
Foreign currency translation | 0 | (279) | 241 | (279) |
Fair value measurement at end of period | $ 555 | $ 9,072 | $ 555 | $ 9,072 |
FINANCIAL INSTRUMENTS AND FAI_9
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Equity Method Investments) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |||||
Equity method investment | $ 8,231 | $ 8,231 | $ 8,252 | ||
Non-marketable equity securities | 5,637 | 5,637 | 5,637 | ||
Total equity investments | 13,868 | 13,868 | $ 13,889 | ||
Equity method investment (gain) loss | $ (134) | $ 320 | $ 21 | $ 2,724 |
SEGMENT INFORMATION (Narrative)
SEGMENT INFORMATION (Narrative) (Details) | 6 Months Ended |
Jun. 30, 2023 segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
SEGMENT INFORMATION (Reconcilia
SEGMENT INFORMATION (Reconciliation of Revenue from Segments to Consolidated) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Total sales | $ 400,044 | $ 350,081 | $ 778,829 | $ 660,993 |
Operating Segments | Medical | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Total sales | 389,111 | 339,834 | 753,377 | 641,861 |
Operating Segments | Medical | Cardio & Vascular | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Total sales | 208,494 | 180,604 | 399,697 | 339,641 |
Operating Segments | Medical | Cardiac Rhythm Management & Neuromodulation | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Total sales | 153,411 | 135,945 | 298,550 | 259,269 |
Operating Segments | Medical | Advanced Surgical, Orthopedics & Portable Medical | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Total sales | 27,206 | 23,285 | 55,130 | 42,951 |
Operating Segments | Non-Medical | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Total sales | $ 10,933 | $ 10,247 | $ 25,452 | $ 19,132 |
SEGMENT INFORMATION (Reconcil_2
SEGMENT INFORMATION (Reconciliation of Operating Profit (Loss) from Segments to Consolidated) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Segment Reporting Information [Line Items] | ||||
Operating income | $ 41,576 | $ 32,707 | $ 75,742 | $ 55,204 |
Unallocated expenses, net | (11,684) | (8,284) | (29,853) | (16,833) |
Income before taxes | 29,892 | 24,423 | 45,889 | 38,371 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Operating income | 68,775 | 56,205 | 127,607 | 101,018 |
Operating Segments | Medical | ||||
Segment Reporting Information [Line Items] | ||||
Operating income | 68,497 | 54,580 | 123,303 | 98,728 |
Operating Segments | Non-Medical | ||||
Segment Reporting Information [Line Items] | ||||
Operating income | 278 | 1,625 | 4,304 | 2,290 |
Segment Reconciling Items | ||||
Segment Reporting Information [Line Items] | ||||
Operating income | $ (27,199) | $ (23,498) | $ (51,865) | $ (45,814) |
REVENUE FROM CONTRACTS WITH C_3
REVENUE FROM CONTRACTS WITH CUSTOMERS (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Concentration Risk [Line Items] | ||||
Revenue recognized that was included in contract liability balance at beginning of period | $ 1.3 | $ 0.8 | $ 2.7 | $ 1.7 |
Revenue Benchmark | Product Concentration Risk | Transferred over Time | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 27% | 32% | 27% | 31% |
REVENUE FROM CONTRACTS WITH C_4
REVENUE FROM CONTRACTS WITH CUSTOMERS (Disaggregated Revenue) (Details) - Revenue from contract with customer benchmark - Customer Concentration Risk | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Medical | Customer A | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 17% | 18% | 18% | 18% |
Medical | Customer B | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 17% | 17% | 17% | 17% |
Medical | Customer C | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 13% | 14% | 13% | 14% |
Medical | All other customers | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 53% | 51% | 52% | 51% |
Non-Medical | Customer D | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 20% | 42% | 21% | 37% |
Non-Medical | All other customers | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 80% | 58% | 79% | 63% |
REVENUE FROM CONTRACTS WITH C_5
REVENUE FROM CONTRACTS WITH CUSTOMERS (Schedule of Revenue by Ship To Location) (Details) - Geographic Concentration Risk - Revenue from contract with customer benchmark | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Jun. 30, 2023 | Jul. 01, 2022 | |
Medical | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 54% | 52% | 54% | 51% |
Medical | All other countries | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 46% | 48% | 46% | 49% |
Non-Medical | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 64% | 71% | 62% | 67% |
Non-Medical | Canada | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 12% | 11% | ||
Non-Medical | All other countries | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 24% | 29% | 27% | 33% |
REVENUE FROM CONTRACTS WITH C_6
REVENUE FROM CONTRACTS WITH CUSTOMERS (Assets and Liability) (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 80,010 | $ 71,927 |
Contract liabilities | $ 8,777 | $ 5,616 |