Document_And_Entity_Informatio
Document And Entity Information | 9 Months Ended | ||
Sep. 30, 2013 | Nov. 13, 2013 | Nov. 13, 2013 | |
Class A-1 Partnership Units [Member] | Class A-2 Partnership Units [Member] | ||
Document Information [Line Items] | ' | ' | ' |
Entity Registrant Name | 'CENTAUR GUERNSEY L.P. INC. | ' | ' |
Entity Central Index Key | '0001557939 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Filer Category | 'Non-accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 341,410,891.61 | 728,041.80 |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'Q3 | ' | ' |
Document Type | '10-Q | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 30-Sep-13 | ' | ' |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $362,919 | $383,150 |
Accounts receivable, net | 368,900 | 355,718 |
Inventories, net | 149,986 | 139,850 |
Prepaid expenses and other | 59,499 | 39,511 |
Total current assets | 941,304 | 918,229 |
Net property, plant and equipment | 312,555 | 388,482 |
Debt issuance costs, net | 101,766 | 96,476 |
Deferred income taxes | 21,866 | 20,003 |
Goodwill | 3,207,575 | 3,479,775 |
Identifiable intangible assets, net | 2,343,525 | 2,666,201 |
Other non-current assets | 4,054 | 5,598 |
Total assets | 6,932,645 | 7,574,764 |
Current liabilities: | ' | ' |
Accounts payable | 44,527 | 40,970 |
Accrued expenses and other | 351,903 | 284,163 |
Current installments of long-term debt | 24,101 | 23,383 |
Deferred income taxes | 4,610 | 57,528 |
Total current liabilities | 425,141 | 406,044 |
Long-term debt, net of current installments and discount | 4,517,139 | 4,554,112 |
Non-current tax liabilities | 46,461 | 44,465 |
Deferred income taxes | 960,219 | 1,069,480 |
Other non-current liabilities | 38,897 | 43,267 |
Total liabilities | 5,987,857 | 6,117,368 |
Equity: | ' | ' |
General partnerbs capital | 0 | 0 |
Limited partnersb capital | 952,314 | 1,457,913 |
Accumulated other comprehensive loss, net | -7,526 | -517 |
Total equity | 944,788 | 1,457,396 |
Total liabilities and shareholders' equity | $6,932,645 | $7,574,764 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||||
Revenue: | ' | ' | ' | ' | ||||
Rental | $191,041 | $207,156 | $569,449 | $622,350 | ||||
Sales | 249,520 | 228,717 | 719,675 | 684,171 | ||||
Total revenue | 440,561 | 435,873 | 1,289,124 | 1,306,521 | ||||
Rental expenses | 85,746 | 100,810 | 273,479 | 348,387 | ||||
Cost of sales | 66,151 | 58,613 | 181,707 | 190,454 | ||||
Gross profit (loss) | 288,664 | 276,450 | 833,938 | 767,680 | ||||
Selling, general and administrative expenses | 152,053 | 142,778 | 518,478 | 445,781 | ||||
Research and development expenses | 17,961 | 17,376 | 56,140 | 53,686 | ||||
Acquired intangible asset amortization | 45,116 | 49,733 | 139,123 | 172,260 | ||||
Impairment of goodwill and intangible assets | 443,400 | [1] | 0 | [1] | 443,400 | [1] | 0 | [1] |
Operating earnings (loss) | -369,866 | 66,563 | -323,203 | 95,953 | ||||
Interest income and other | 217 | 174 | 1,279 | 630 | ||||
Interest expense | -101,398 | -117,920 | -315,144 | -353,107 | ||||
Loss on extinguishment of debt | -200 | 0 | -2,364 | 0 | ||||
Foreign currency gain (loss) | -8,738 | -5,258 | -11,935 | 428 | ||||
Derivative instruments gain (loss) | -6,840 | -8,579 | 3,200 | -28,473 | ||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | -486,825 | -65,020 | -648,167 | -284,569 | ||||
Income tax benefit | -88,519 | -27,176 | -144,543 | -107,125 | ||||
Earnings (loss) from continuing operations | -398,306 | -37,844 | -503,624 | -177,444 | ||||
Gain (loss) from discontinued operations, net of tax | -255 | 2,032 | -2,299 | -3,680 | ||||
Net earnings (loss) | ($398,561) | ($35,812) | ($505,923) | ($181,124) | ||||
[1] | During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit. |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (Loss) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Net loss | ($398,561) | ($35,812) | ($505,923) | ($181,124) |
Unrealized investment gain, net of tax expense of $338 and $1,413 in 2013 | 541 | 0 | 2,257 | 0 |
Foreign currency translation adjustment, net of tax benefit (expense) of $(300) and $259 in 2013 and $(164) and $(438) in 2012 | -5,131 | 1,597 | -9,266 | -1,587 |
Total comprehensive income (loss) | ($403,151) | ($34,215) | ($512,932) | ($182,711) |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Unrealized investment gain, net of tax expense of $338 and $1,413 in 2013 | $338 | ' | $1,413 | ' |
Foreign currency translation adjustment, net of tax benefit (expense) of $(300) and $259 in 2013 and $(164) and $(438) in 2012 | ($300) | ($164) | $259 | ($438) |
Condensed_Consolidated_Stateme3
Condensed Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | ||
Cash flows from operating activities: | ' | ' | ||
Net loss | ($505,923) | ($181,124) | ||
Adjustments to reconcile net loss to net cash provided by operating activities: | ' | ' | ||
Amortization of debt issuance costs and discount | 26,356 | 24,417 | ||
Depreciation and other amortization | 252,026 | 346,895 | ||
Loss on disposition of assets | 3,189 | 0 | ||
Amortization of fair value step-up in inventory | 0 | 25,021 | ||
Fixed asset and inventory impairment | 30,259 | 22,116 | ||
Impairment of goodwill and intangible assets | 443,400 | [1] | 0 | [1] |
Write-off of other intangible assets | 16,885 | 0 | ||
Provision for bad debt | 5,051 | 7,019 | ||
Loss on extinguishment of debt | 2,164 | 0 | ||
Equity-based compensation expense | 2,046 | 1,186 | ||
Deferred income tax benefit | -165,456 | -132,639 | ||
Unrealized loss (gain) on derivative instruments | -5,729 | 27,770 | ||
Unrealized loss (gain) on revaluation of cross currency debt | 8,174 | -2,685 | ||
Change in assets and liabilities: | ' | ' | ||
Decrease (increase) in accounts receivable, net | -23,046 | 10,675 | ||
Increase in inventories, net | -10,498 | -7,270 | ||
Decrease (increase) in prepaid expenses and other | -17,137 | 3,281 | ||
Increase (decrease) in accounts payable | 3,273 | -9,445 | ||
Increase in accrued expenses and other | 68,440 | 48,359 | ||
Increase in tax liabilities, net | 2,021 | 2,299 | ||
Net cash provided (used) by operating activities | 135,495 | 185,875 | ||
Cash flows from investing activities | ' | ' | ||
Additions to property, plant and equipment | -59,868 | -72,044 | ||
Increase (decrease) in inventory to be converted into equipment for short-term rental | -8,881 | 861 | ||
Dispositions of property, plant and equipment | 1,052 | 1,673 | ||
Increase in identifiable intangible assets and other non-current assets | -4,273 | -5,380 | ||
Net cash provided (used) by investing activities | -71,970 | -74,890 | ||
Cash flows from financing activities: | ' | ' | ||
Capital contributions from limited partners | 0 | 239 | ||
Distribution to limited partners | -1,572 | -1,970 | ||
Repayments of long-term debt and capital lease obligations | -60,429 | -17,483 | ||
Payment of debt issuance costs | -21,604 | -578 | ||
Net cash provided (used) by financing activities | -83,605 | -19,792 | ||
Effect of exchange rate changes on cash and cash equivalents | -151 | 308 | ||
Net increase (decrease) in cash and cash equivalents | -20,231 | 91,501 | ||
Cash and cash equivalents, beginning of period | 383,150 | 215,426 | ||
Cash and cash equivalents, end of period | $362,919 | $306,927 | ||
[1] | During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
Summary of Significant Accounting Policies | ' |
Summary of Significant Accounting Policies | |
(a) Basis of Presentation and Principles of Consolidation | |
The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP” or “the Codification”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information necessary for a fair presentation of results of operations, financial position and cash flows in conformity with GAAP. Operating results from interim periods are not necessarily indicative of results that may be expected for the fiscal year as a whole. The condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation of our results for the interim periods presented. Certain prior period amounts have been reclassified to conform to the 2013 presentation. | |
On August 15, 2012, KCI announced that it had entered into an asset purchase agreement with Getinge for the sale of KCI's Therapeutic Support Systems ("TSS") business (the “Agreement”). The transaction closed on November 8, 2012. The final adjusted purchase price paid by Getinge to KCI was $241.5 million. Under the terms of the Agreement, we agreed to provide transition services to Getinge after the close of the transaction. In accordance with the Codification, depreciation and amortization of the long-lived assets subject to the Agreement ceased as of August 15, 2012. Additionally, the results of the operations subject to the Agreement, excluding the allocation of general corporate overhead, are presented as discontinued operations in the condensed consolidated statements of operations for all periods presented. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement. | |
The Company has two reportable operating segments which correspond to our two global businesses: KCI and LifeCell Corporation ("LifeCell"). We have two primary geographic regions for which we provide supplemental information: the Americas, which is comprised principally of the United States and includes Canada, Puerto Rico and Latin America; and EMEA/APAC, which is comprised of Europe, the Middle East, Africa and the Asia Pacific region. | |
The condensed consolidated financial statements appearing in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012. | |
(b) Derivative Financial Instruments and Fair Value Measurements | |
We use derivative financial instruments to manage the economic impact of fluctuations in interest rates. We do not use financial instruments for speculative or trading purposes. Periodically, we enter into interest rate protection agreements to modify the interest characteristics of our outstanding debt. Our interest rate derivatives have not been designated as hedging instruments, and as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. | |
We also use derivative financial instruments to manage the economic impact of fluctuations in currency exchange rates on our intercompany balances and corresponding cash flows and to manage our transactional currency exposures when our foreign subsidiaries enter into transactions denominated in currencies other than their local currency. We enter into foreign currency exchange contracts to manage these economic risks. These contracts are not designated as hedges; as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. Although we use master netting agreements with our derivative counterparties, we do not offset derivative asset and liability positions in the condensed consolidated balance sheets. | |
All derivative instruments are recorded on the balance sheets at fair value. The fair values of our interest rate derivatives and foreign currency exchange contracts are determined based on inputs that are readily available in public markets or can be derived from information available in publicly-quoted markets, which represent level 2 inputs as defined by the Codification. | |
(c) Concentration of Credit Risk | |
We have a concentration of credit risk with financial institutions related to our derivative instruments. As of September 30, 2013, Morgan Stanley, UBS and HSBC were the counterparties on our interest rate protection agreements consisting of interest rate swap and cap agreements in notional amounts totaling $1.031 billion each. We use master netting agreements with our derivative counterparties to reduce our risk and use multiple counterparties to reduce our concentration of credit risk. | |
We maintain cash and cash equivalents with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. These deposits bear minimal credit risk as they are maintained at financial institutions of reputable credit and generally may be redeemed upon demand. | |
(d) Recently Adopted Accounting Standards | |
In January 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities." The objective of this guidance is to clarify offsetting disclosures that apply to accounting for derivatives and hedging, including bifurcated embedded derivatives, repurchase agreements, reverse repurchase agreements and securities lending transactions. This guidance is effective for fiscal years and interim periods beginning on or after January 1, 2013. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures. | |
In January 2013, the FASB issued ASU No. 2013-02 “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income." The objective of this guidance is to improve reporting of reclassifications out of accumulated other comprehensive income. The guidance does not change current requirements for reporting net income or other comprehensive income in financial statements. The guidance requires an entity to provide information about amounts reclassified out of accumulated other comprehensive income by component, and present either in the income statement or notes, significant amounts reclassified by the respective line items of net income. For public entities, this guidance is effective for reporting periods beginning after December 15, 2012. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures. | |
(e) Long-Lived Assets | |
When an event occurs that indicates the carrying value of long-lived assets might not be recoverable, we review property, plant and equipment for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly. During the first nine months of 2013, we recorded a $30.3 million fixed asset impairment charge. | |
(f) Goodwill and Other Intangible Assets | |
Goodwill represents the excess purchase price over the fair value of net assets acquired. Goodwill is tested for impairment by reporting unit annually, or more frequently when events or changes in circumstances indicate that the asset might be impaired. Impairment of goodwill is tested by comparing the carrying value of the reporting unit to the reporting unit’s fair value. The carrying value of each reporting unit is determined by taking the reported net assets of the consolidated entity, identifying reporting unit specific assets (including goodwill) and liabilities and allocating shared operational and administrative assets and liabilities to the appropriate reporting unit, which is the same as the segment to which they are assigned. The fair value of each reporting unit is determined using discounted cash flow models using certain performance assumptions and appropriate discount rates determined by our management. To ensure the reasonableness of the estimated fair value of our reporting units, we also consider current industry market multiples. When it is determined that the carrying value of goodwill may not be recoverable based upon the existence of one or more of the above indicators of impairment, the measurement of any impairment is determined and the carrying value is reduced as appropriate. | |
Identifiable intangible assets include developed technology, in process research and development, customer relationships, tradenames and patents. For intangible assets that are subject to amortization, we amortize the assets over the estimated economic or contractual life of the individual asset. When an event occurs that indicates the carrying value of definite-lived intangible assets might not be recoverable, we review the assets for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly. Indefinite-lived intangibles are tested for impairment annually, or more frequently when events or changes in circumstances indicate that the assets might be impaired. If the carrying amount of the indefinite-lived intangible assets exceeds their fair value, an impairment is recognized in an amount equal to that excess. | |
The Company performed an interim impairment test on goodwill of its LifeCell reporting unit during the third quarter of 2013. In our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, we disclosed that in the event of an approximate 6% and 4% drop in the fair value of our LifeCell reporting unit and the fair value of our LifeCell identifiable intangible assets, respectively, the fair value of the LifeCell reporting unit and identifiable intangible assets would still exceed their book values as of October 31, 2012. The Company continued to monitor the close proximity of the reporting unit's carrying value compared to its fair value and, in the third quarter, determined it was required to complete the interim impairment test, as defined under GAAP. The results of the third quarter 2013 interim impairment test indicated that the estimated fair value of the LifeCell reporting unit was less than its carrying value; consequently, during the third quarter of 2013 we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit. | |
During the third quarter and first nine months of 2013, write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets were recorded due primarily to the discontinuation of certain projects. | |
(g) Other Significant Accounting Policies | |
For further information on our significant accounting policies, see Note 1 of the notes to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012. |
Business_Acquisition_Business_
Business Acquisition Business Acquisition | 9 Months Ended |
Sep. 30, 2013 | |
Business Acquisition [Abstract] | ' |
Business Combination Disclosure [Text Block] | ' |
Business Acquisition | |
On July 30, 2013, KCI announced that it had signed a definitive share purchase agreement to acquire Systagenix, an established provider of advanced wound care ("AWC") products. The transaction closed on October 28, 2013. At the closing of the transaction, KCI paid a purchase price of $485.0 million, subject to adjustment, using $350.0 million of incremental borrowings under our existing senior secured credit facility along with cash on hand to fund the purchase price. The acquisition will be accounted for as a business combination using the acquisition method. Once our preliminary purchase price allocation has been completed, the purchase price will be allocated to the Systagenix tangible and identifiable intangible assets based on their estimated fair values as of the acquisition date. Any excess of the purchase price over the identifiable intangible and net tangible assets will be allocated to goodwill, which is not deductible for tax purposes. | |
Systagenix has a broad portfolio of innovative advanced wound care products with a focus on moist wound healing dressings - including PROMOGRAN PRISMA®, the collagen dressing market leader, TIELLE® (foam) and ADAPTIC® (non adherent contact layers). Systagenix's manufacturing, marketing and sales teams supply and distribute over 20 million advanced wound care dressings each month to more than 70 countries. The company, formerly part of Johnson & Johnson, generates annual revenue of approximately $200.0 million and has approximately 800 employees worldwide, including an experienced team of research and development scientists dedicated to advancing skin and wound care. Combining Systagenix's expertise with KCI's innovation pipeline and scale will create additional value for customers and help speed healing and reduce complications for patients. |
Sale_of_Therapeutic_Support_Sy
Sale of Therapeutic Support Systems Assets | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | |||||||||||||||
Sale of Therapeutic Support Systems Assets | ' | |||||||||||||||
Sale of Therapeutic Support Systems Assets | ||||||||||||||||
On August 15, 2012, KCI announced that it had entered into an asset purchase agreement with Getinge for the sale of KCI's TSS business. The transaction closed on November 8, 2012. The final adjusted purchase price paid by Getinge to KCI was $241.5 million. Under the terms of the Agreement, we agreed to provide transition services to Getinge after the close of the transaction. The historical results of operations of the disposal group, excluding the allocation of general corporate overhead, are reported as discontinued operations in the condensed consolidated statements of operations. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement. | ||||||||||||||||
The Company utilized the net proceeds from the sale to fund the acquisition of Systagenix and internal investments, which satisfied our reinvestment requirement. Therefore, we do not anticipate having a repayment requirement in the fourth quarter associated with the sale of our TSS business. | ||||||||||||||||
The operating results of the TSS product portfolio included in discontinued operations are as follows (in thousands): | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenue | $ | — | $ | 52,673 | $ | — | $ | 168,107 | ||||||||
Earnings (loss) before income tax expense (benefit) | $ | (415 | ) | $ | 3,304 | $ | (3,738 | ) | $ | (5,984 | ) | |||||
Income tax expense (benefit) | $ | (160 | ) | $ | 1,272 | $ | (1,439 | ) | $ | (2,304 | ) | |||||
Gain (loss) from discontinued operations, net of tax | $ | (255 | ) | $ | 2,032 | $ | (2,299 | ) | $ | (3,680 | ) | |||||
Supplemental_Balance_Sheet_Dat
Supplemental Balance Sheet Data | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Balance Sheet Related Disclosures [Abstract] | ' | |||||||
Supplemental Balance Sheet Data | ' | |||||||
Supplemental Balance Sheet Data | ||||||||
(a) Accounts Receivable, net | ||||||||
Accounts receivable consist of the following (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Gross trade accounts receivable: | ||||||||
Billed trade accounts receivable | $ | 382,538 | $ | 370,708 | ||||
Unbilled receivables | 49,350 | 45,466 | ||||||
Less: Allowance for revenue adjustments | (69,546 | ) | (71,770 | ) | ||||
Gross trade accounts receivable | 362,342 | 344,404 | ||||||
Less: Allowance for bad debt | (7,017 | ) | (4,768 | ) | ||||
Net trade accounts receivable | 355,325 | 339,636 | ||||||
Other receivables | 13,575 | 16,082 | ||||||
$ | 368,900 | $ | 355,718 | |||||
(b) Inventories, net | ||||||||
Inventories consist of the following (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Finished goods and tissue available for distribution | $ | 100,873 | $ | 96,573 | ||||
Goods and tissue in-process | 9,325 | 12,421 | ||||||
Raw materials, supplies, parts and unprocessed tissue | 66,033 | 45,993 | ||||||
176,231 | 154,987 | |||||||
Less: Amounts expected to be converted into equipment for short-term rental | (14,118 | ) | (5,237 | ) | ||||
Reserve for excess and obsolete inventory | (12,127 | ) | (9,900 | ) | ||||
$ | 149,986 | $ | 139,850 | |||||
LongTerm_Debt
Long-Term Debt | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Long-Term Debt | ' | |||||||
Long-Term Debt | ||||||||
Long-term debt consists of the following (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Senior Dollar Term D-1 Credit Facility (1) – due 2018 | $ | 1,601,607 | $ | 1,613,700 | ||||
Senior Euro Term D-1 Credit Facility (1) – due 2018 | 332,186 | 327,022 | ||||||
Senior Term D-2 Credit Facility (1) – due 2016 | 319,339 | 321,750 | ||||||
10.5% Second Lien Senior Secured Notes due 2018 | 1,750,000 | 1,750,000 | ||||||
12.5% Senior Unsecured Notes due 2019 | 612,000 | 650,000 | ||||||
3.25% Convertible Senior Notes due 2015 | 101 | 701 | ||||||
IBM Financing | 2,271 | — | ||||||
Notional amount of debt | 4,617,504 | 4,663,173 | ||||||
Senior Dollar Term D-1 Credit Facility Discount, net of accretion | (32,100 | ) | (33,840 | ) | ||||
Senior Euro Term D-1 Credit Facility Discount, net of accretion | (11,033 | ) | (13,353 | ) | ||||
Senior Term D-2 Credit Facility Discount, net of accretion | (4,860 | ) | (7,064 | ) | ||||
Second Lien Senior Secured Notes Discount, net of accretion | (25,160 | ) | (27,827 | ) | ||||
Senior Unsecured Notes Discount, net of accretion | (3,111 | ) | (3,594 | ) | ||||
Net discount on debt | (76,264 | ) | (85,678 | ) | ||||
Total debt, net of discount | 4,541,240 | 4,577,495 | ||||||
Less: Current installments | (24,101 | ) | (23,383 | ) | ||||
$ | 4,517,139 | $ | 4,554,112 | |||||
_____________________________ | ||||||||
(1) On June 14, 2013, we entered into Amendment No. 2 to our senior secured credit facility. As a result of the amendment we created new classes of Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, having the same rights and obligations as the Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans as set forth in the Credit Agreement and Loan Documents, except as revised by the amendment. | ||||||||
Senior Secured Credit Facility | ||||||||
Our senior secured credit facility (the “Senior Secured Credit Facility”) includes a $200 million revolving credit facility (the “Revolving Credit Facility”). Amounts available under the Revolving Credit Facility are available for borrowing and reborrowing until maturity. At September 30, 2013 and December 31, 2012, no revolving credit loans were outstanding and we had outstanding letters of credit issued by banks which are party to the Senior Secured Credit Facility of $10.7 million and $11.5 million, respectively. In addition, we had $3.5 million and $4.6 million of letters of credit issued by a bank not party to the Senior Secured Credit Facility as of September 30, 2013 and December 31, 2012, respectively. The capacity of the Revolving Credit Facility is reduced for the $10.7 million and $11.5 million of letters of credit issued by banks which are party to the Senior Secured Credit Facility as of September 30, 2013 and December 31, 2012, respectively. The resulting availability under the Revolving Credit Facility was $189.3 million and $188.5 million at September 30, 2013 and December 31, 2012, respectively. Commitment fees accrue at a rate of 0.375% on the amounts available under the Revolving Credit Facility. | ||||||||
On June 14, 2013, we entered into Amendment No. 2 to our Senior Secured Credit Facility ("Amendment No. 2"). As a result of the amendment we created new classes of Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, having the same rights and obligations as the Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans as set forth in the Credit Agreement and Loan Documents, except as revised by the amendment. In connection with Amendment No. 2, Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans were refinanced with Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, respectively. | ||||||||
In connection with our acquisition of Systagenix, we borrowed $350.0 million of incremental term D-1 loans (the "Incremental Loans") incurred pursuant to Amendment No. 3 to our Senior Secured Credit Facility, dated as of October 28, 2013. The Incremental Loans were issued at a discount of $0.4 million. The interest rate and all other terms are identical to our previously-existing Dollar Term D-1 Loans. | ||||||||
Interest. Amounts outstanding under the Dollar Term D-1 Loans, the Term D-2 Loans and the Revolving Credit Facility (other than swing-line loans and unreimbursed drawings on letters of credit) bear interest, at our option, at a rate equal to either the base rate or the eurocurrency rate, in each case plus an applicable margin. Amounts outstanding under the Euro Term D-1 Loans bear interest at the eurocurrency rate, and swing-line loans and unreimbursed drawings on letters of credit bear interest at the base rate. As a result of Amendment No. 2, the new applicable margins are (i) for eurocurrency rate loans that are Dollar Term D-1 Loans, 3.50%, (ii) for base rate loans that are Dollar Term D-1 Loans, 2.50%, (iii) for eurocurrency rate loans that are Euro Term D-1 Loans, 3.75%, (iv) for base rate loans that are Euro Term D-1 Loans, 2.75%, (v) for eurocurrency rate loans that are Term D-2 Loans, 3.00%, and (vi) for base rate loans that are Term D-2 Loans, 2.00%. The Term D loans will have a eurocurrency rate floor of 1.00% and a base rate floor of 2.00%. | ||||||||
10.5% Second Lien Senior Secured Notes and 12.5% Senior Unsecured Notes | ||||||||
As required upon the closing of our 10.5% Second Lien Senior Secured Notes due 2018 (“10.5% Second Lien Notes”) and the 12.5% Senior Unsecured Notes due 2019 (“12.5% Unsecured Notes”), we have entered into registration rights agreements with respect to these notes. Pursuant to the terms of the registration rights agreements, we filed a registration statement (the “Registration Statement”) with respect to a registered exchange offer to exchange such notes for new notes with terms substantially identical in all material respects with the notes (except for the provisions relating to the transfer restrictions and payment of additional interest). On February 13, 2013, our Registration Statement was declared effective by the Securities and Exchange Commission (“SEC”), and our exchange offer was completed on March 15, 2013. | ||||||||
Because our Registration Statement was not declared effective by the SEC under the Securities Act and the exchange offer was not consummated within 365 days following the issuance of the notes (“Exchange Date”), and because we did not file a shelf registration statement covering resales of the notes within 30 days after the Exchange Date (each a “Notes Registration Default”), additional interest accrued on the aggregate principal amount of the notes from and including the date on which any such Notes Registration Default occurred to but excluding the date on which the Notes Registration Defaults were cured through the completion of the exchange offer. Under the terms of the registration rights agreements entered into with respect to these notes, additional interest was accrued at a rate of 0.25% and 0.50% from November 4, 2012 to February 4, 2013 and February 5, 2013 to March 15, 2013, respectively. | ||||||||
During the nine months ended September 30, 2013, we repurchased $38.0 million in principal of our 12.5% Unsecured Notes. | ||||||||
Covenants | ||||||||
As of September 30, 2013, we were in compliance with all covenants under our Senior Secured Credit Facility, 10.5% Second Lien Notes, 12.5% Unsecured Notes, and 3.25% Convertible Senior Notes due 2015 (“the Convertible Notes”). | ||||||||
For further information on our long-term debt, see Note 6 of the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012. |
Derivative_Financial_Instrumen
Derivative Financial Instruments and Fair Value Measurements | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||
Derivative Financial Instruments and Fair Value Measurements Disclosure [Abstract] | ' | |||||||||||||||||||
Derivative Financial Instruments and Fair Value Measurements | ' | |||||||||||||||||||
Derivative Financial Instruments and Fair Value Measurements | ||||||||||||||||||||
We are exposed to credit loss in the event of nonperformance by counterparties to the extent of the fair values of the outstanding interest rate swap agreements, interest rate cap agreements and foreign currency exchange contracts, but we do not anticipate nonperformance by any of the counterparties. All derivative instruments are recorded on the balance sheets at fair value. We do not use financial instruments for speculative or trading purposes. | ||||||||||||||||||||
Interest Rate Protection | ||||||||||||||||||||
At September 30, 2013 and December 31, 2012, we had three interest rate swap agreements to convert a portion of our outstanding variable rate debt to a fixed rate basis. These agreements become effective in December 2013, have not been designated as hedging instruments, and as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. The interest rate swap agreements have quarterly interest payments, receive rates based on the higher of three-month USD LIBOR or 1.25% and pay rates based on fixed rates, due on the last day of March, June, September and December. Once effective, the aggregate notional amount decreases quarterly by amounts ranging from $1.7 million to $56.4 million until maturity. | ||||||||||||||||||||
The following table summarizes our interest rate swap agreements (dollars in thousands): | ||||||||||||||||||||
Effective Dates | Original Notional Amount | Fixed Interest Rate | ||||||||||||||||||
12/31/13-12/31/16 | $512,633 | 2.26% | ||||||||||||||||||
12/31/13-12/31/16 | $512,633 | 2.25% | ||||||||||||||||||
12/31/13-12/31/16 | $512,633 | 2.25% | ||||||||||||||||||
As of September 30, 2013 and December 31, 2012, we had interest rate cap agreements with initial notional amounts of $1.6 billion at a cost of $2.2 million that effectively limited the eurocurrency interest rate to 2% on a portion of the borrowings under our Senior Secured Credit Facility. The interest rate cap agreements expire on December 31, 2013. | ||||||||||||||||||||
Foreign Currency Exchange Rate Mitigation | ||||||||||||||||||||
At September 30, 2013 and December 31, 2012, we had foreign currency exchange contracts to sell or purchase $34.8 million and $59.1 million, respectively, of various currencies. | ||||||||||||||||||||
Fair Value Measurements | ||||||||||||||||||||
The Codification defines fair value as the exit price that would be received to sell an asset or paid to transfer a liability. The Fair Value Measurements and Disclosure topic of the Codification establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. | ||||||||||||||||||||
The carrying amount reported in the balance sheets for cash and cash equivalents, accounts receivable, accounts payable and long-term obligations, excluding our borrowings under our Senior Secured Credit Facility and fixed rate long-term debt, including the 10.5% Second Lien Secured Notes, the 12.5% Unsecured Notes and the Convertible Notes approximates fair value. The fair value of our borrowings under our Senior Secured Credit Facility and fixed rate long-term debt was $2.3 billion and $2.6 billion, respectively, at September 30, 2013. The fair value of our borrowings under our Senior Secured Credit Facility and fixed rate long-term debt was $2.3 billion and $2.4 billion, respectively, at December 31, 2012. The fair value of our long-term debt was estimated based upon open-market trades at or near year end. | ||||||||||||||||||||
All of our derivatives, as of the reporting date, use inputs considered as Level 2. The interest rate swap agreements and interest rate cap agreements are valued using a discounted cash flow model that takes into account the present value of the future cash flows under the terms of the agreements by using market information available as of the reporting date, including prevailing interest rates and related forward interest rate curves. The foreign currency exchange contracts are valued using a discounted cash flow model that takes into account the present value of the future cash flows under the terms of the agreements by using market information available as of the reporting date, including prevailing foreign currency exchange rates and related foreign currency exchange rate curves. | ||||||||||||||||||||
The following table sets forth the location and aggregate fair value amounts of all derivative instruments with credit-related contingent features (in thousands): | ||||||||||||||||||||
Asset Derivatives | Liability Derivatives | |||||||||||||||||||
Balance | Fair Value | Balance | Fair Value | |||||||||||||||||
Sheet | Sheet | |||||||||||||||||||
Location | September 30, | December 31, | Location | September 30, | December 31, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||||||
Interest rate swap agreements | Prepaid expenses and other | $ | — | $ | — | Accrued expenses and other | $ | 330 | $ | — | ||||||||||
Interest rate swap agreements | Other non-current assets | — | — | Other non-current liabilities | 30,482 | 34,868 | ||||||||||||||
Interest rate cap agreements | Prepaid expenses and other | — | 9 | Accrued expenses and other | — | — | ||||||||||||||
Foreign currency exchange contracts | Prepaid expenses and other | 230 | 520 | Accrued expenses and other | 1,008 | 2,980 | ||||||||||||||
Total derivatives | $ | 230 | $ | 529 | $ | 31,820 | $ | 37,848 | ||||||||||||
The following table summarizes the amount of gain (loss) on derivatives not designated as hedging instruments (dollars in thousands): | ||||||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
Interest rate swap agreements | $ | (5,195 | ) | $ | (6,313 | ) | $ | 4,057 | $ | (24,610 | ) | |||||||||
Interest rate cap agreements | (4 | ) | (118 | ) | (9 | ) | (1,563 | ) | ||||||||||||
Foreign currency exchange contracts | (1,641 | ) | (2,148 | ) | (848 | ) | (2,300 | ) | ||||||||||||
$ | (6,840 | ) | $ | (8,579 | ) | $ | 3,200 | $ | (28,473 | ) | ||||||||||
Certain of our derivative instruments contain provisions that require compliance with the restrictive covenants of our Senior Secured Credit Facility. For further information regarding the restrictive covenants of credit facilities, see Note 6 of the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012. | ||||||||||||||||||||
If we default under our credit facilities, the lenders could require immediate repayment of the entire principal. If those lenders require immediate repayment, we may not be able to repay them which could result in the foreclosure of substantially all of our assets. In these circumstances, the counterparties to the derivative instruments could request immediate payment or full collateralization on derivative instruments in net liability positions. Certain of our derivative counterparties are also parties to our Senior Secured Credit Facility. | ||||||||||||||||||||
No collateral has been posted by us in the normal course of business. If the credit-related contingent features underlying these agreements were triggered on September 30, 2013, we could be required to settle or post the full amount as collateral to the respective agreement counterparties. | ||||||||||||||||||||
We did not have any measurements of financial assets or financial liabilities at fair value on a nonrecurring basis at September 30, 2013 or December 31, 2012. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Income (Loss) | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Other Comprehensive Income [Abstract] | ' | |||||||||||
Comprehensive Income (Loss) Note | ' | |||||||||||
Accumulated Other Comprehensive Loss | ||||||||||||
The components of accumulated other comprehensive loss are as follows (in thousands): | ||||||||||||
Accumulated | Investment Gain | Accumulated | ||||||||||
Foreign | Other | |||||||||||
Currency | Comprehensive | |||||||||||
Translation | Income (Loss) | |||||||||||
Adjustment | ||||||||||||
Balances at December 31, 2012 | $ | (517 | ) | $ | — | $ | (517 | ) | ||||
Unrealized investment gain, net of tax expense of $1,413 | — | 2,257 | 2,257 | |||||||||
Foreign currency translation adjustment, net of tax benefit of $259 | (9,266 | ) | — | (9,266 | ) | |||||||
Balances at September 30, 2013 | $ | (9,783 | ) | $ | 2,257 | $ | (7,526 | ) | ||||
During the nine months ended September 30, 2013, there were no reclassification adjustments out of accumulated other comprehensive loss to net loss. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
Commitments and Contingencies | |
LEGAL PROCEEDINGS | |
Intellectual Property Litigation | |
As the owner and exclusive licensee of patents, from time to time, we are a party to proceedings challenging these patents, including challenges in U.S. federal courts, foreign courts, foreign patent offices and the U.S. Patent and Trademark Office. Additionally, from time to time, we are a party to litigation we initiate against others we contend infringe these patents, which often results in counterclaims regarding the validity of such patents. At other times, we are party to litigation initiated by others who contend we infringe their patents. It is not possible to reliably predict the outcome of the proceedings described below. However, if we are unable to effectively enforce our intellectual property rights, third parties may become more aggressive in the marketing of competitive products around the world. | |
Smith & Nephew Litigation | |
In 1993, KCI exclusively licensed several patent applications from Wake Forest University relating to negative pressure wound therapy (“NPWT”) that ultimately issued in several countries. In the following years, KCI developed and began marketing V.A.C.® Therapy, the first commercially available NPWT system. In 2003, BlueSky Medical launched the first competitive NPWT system. Unlike KCI, BlueSky commercialized a gauze-based system that utilized pumps manufactured by Medela AG (“Medela”). Shortly thereafter, KCI and Wake Forest sued BlueSky and Medela for infringement of the patents KCI licensed from Wake Forest. Following a jury trial in the Federal District Court for the Western District of Texas (“Western District”) in 2006, a judgment was entered holding that BlueSky's gauze-based NPWT system did not infringe these patents. That judgment was appealed to the United States Court of Appeals for the Federal Circuit (“Federal Circuit”), which affirmed the judgment of the trial court. In April 2007, Smith & Nephew PLLC acquired BlueSky and began commercializing NPWT products. Shortly thereafter, in May 2007, KCI and Wake Forest filed a patent infringement lawsuit against Smith & Nephew asserting patent infringement. In January 2009, Smith & Nephew launched a foam-based NPWT system at which point KCI and Wake Forest amended their claims against Smith & Nephew to assert additional patent claims. This case was tried by a jury in February 2010. Following the trial, the jury found that the patent claims asserted were not invalid and also found that Smith & Nephew was infringing the asserted patent claims. However, in October 2010, the Western District granted a motion for judgment as a matter of law filed by Smith & Nephew and entered an order invalidating the Wake Forest patent claims asserted in the case. This decision followed the revocations of the UK and German equivalents of the Wake Forest patents and was later followed by the revocation of the Australian equivalent. The litigation resulting in these revocations is detailed below. Wake Forest appealed this decision to the Federal Circuit. | |
On August 13, 2012, the Court of Appeals for the Federal Circuit reversed the judgment of the District Court in the Smith & Nephew litigation, and remanded the case for resolution of several outstanding motions. The Court of Appeals ruled that the trial court was bound by the jury's advisory verdict on the legal question of obviousness because there was sufficient evidence to support the factual questions that were posed to them. It did not construe any prior art or rule that the patent claims are valid as a matter of law; rather, it held that Smith & Nephew failed to carry its burden of persuasion. Smith & Nephew subsequently filed a motion for rehearing en banc at the Federal Circuit Court of Appeals, arguing that the trial court cannot be bound by the advisory verdict of the jury on obviousness, because obviousness is a question of law. At least four amicus briefs were filed, including one from the Federal Circuit Bar Association, in support of Smith & Nephew's position. On November 1, 2012, Smith & Nephew announced it had reached a global settlement with Wake Forest to resolve all patent disputes between them related to NPWT. Following the settlement, the Federal Circuit appeal was dismissed. | |
Wake Forest Litigation | |
Since at least 2009, a host of companies began offering NPWT systems, both gauze-based and foam-based, across the globe. None of these companies licensed the Wake Forest patents prior to commercializing their products. To the contrary, several succeeded in having the patents declared invalid. These proceedings are also detailed herein. | |
In light of the multiple rulings declaring the patents invalid, KCI reassessed the validity of the patents and determined that continued payment of the royalties scheduled under the 1993 license agreement with Wake Forest was inappropriate. KCI withdrew from the Smith & Nephew litigation and on February 28, 2011, filed suit in the Western District of Texas seeking a declaratory judgment that, among other things, KCI no longer owes royalties to Wake Forest because the relevant patent claims are invalid or not infringed. Historical royalties under the license agreement, although disputed, were accrued through February 27, 2011 and are reflected in our consolidated financial statements. For the year ended December 31, 2010, royalty payments accrued or paid to Wake Forest under the license agreement totaled approximately $86 million. No royalty payments have been made to Wake Forest since July, 2010. | |
On March 18, 2011, Wake Forest provided KCI with written notice of termination of the license agreement and filed suit in Forsyth County Superior Court, North Carolina, alleging breach of contract by KCI. In its termination notice, Wake Forest demanded that KCI cease manufacturing and selling licensed products. KCI subsequently removed that action from state court to the Federal District Court for the Middle District of North Carolina, after which Wake Forest amended its complaint to add allegations of patent infringement. KCI moved to have the North Carolina case transferred to the Western District of Texas, and on August 26, 2011, the case was transferred to the Western District, where it was consolidated with KCI's existing suit. The Western District case was stayed pending a decision by the Court of Appeals for the Federal Circuit in the Smith & Nephew litigation described above. | |
On November 1, 2012, Smith & Nephew announced it had reached a global settlement with Wake Forest to resolve all patent disputes between them related to NPWT. Following the settlement, the Federal Circuit appeal was dismissed, and the stay in the case between KCI and Wake Forest was lifted. The case has been set for trial in April 2014. In January and February of 2013, Wake Forest and KCI filed their respective answers and counterclaims against each other. KCI is alleging breach of contract against Wake Forest for its refusal to negotiate in good faith to reduce the royalty rate under the license agreement following the several patent invalidity rulings and subsequent loss of market share by KCI. Because of the multiple rulings declaring the patents invalid and the August 13, 2012 decision in the Smith & Nephew litigation does not construe any prior art or rule that the patent claims are valid as a matter of law, KCI's assessment that the Wake Forest patents are invalid or not infringed by KCI's products has not changed. We continue to vigorously defend our positions in the case and KCI will continue to manufacture and sell V.A.C.® Therapy products. It is not possible to predict the outcome of this litigation nor is it possible to estimate any damages that may be awarded if we are unsuccessful in the litigation. We believe that any damages awarded as a reasonable royalty in this case would be substantially less than our previous royalty obligation to Wake Forest because the prior license agreement provided KCI with worldwide exclusive rights, whereas any infringement damages in the case would be based on US non-exclusive rights. We also believe our counter-claims against Wake Forest could further reduce our potential exposure to a damages award in the event we are unsuccessful on the liability issues of the case. | |
Because KCI believes the Wake Forest patents are invalid, KCI has not continued to enforce the Wake Forest Patents against alleged infringers. Instead, KCI has withdrawn from each of the cases described below that involve the Wake Forest patents. | |
Other US Intellectual Property Litigation | |
In May 2007, contemporaneous with the filing of the lawsuit against Smith & Nephew which is detailed above, KCI and Wake Forest filed a case against Medela, for the manufacture, use and sale of NPWT products alleging infringement of the Wake Forest patents. Medela responded by alleging, among other things, that the Wake Forest patents are invalid. Following the October 2010 judgment invalidating the claims in the Wake Forest patents, the case against Medela was stayed. Because KCI believes the Wake Forest patents are invalid, KCI filed an unopposed motion to withdraw from the case, which was granted by the court in February 2013. On May 14, 2013, Wake Forest and Medela filed a stipulation of dismissal with prejudice following settlement of the disputes between them. | |
In January 2008, KCI and Wake Forest filed a patent infringement lawsuit against Innovative Therapies, Inc. (“ITI”) in the U.S. District Court for the Middle District of North Carolina. The federal complaint alleged that a NPWT device introduced by ITI in 2007 infringed three Wake Forest patents. ITI responded by alleging, among other things, that the Wake Forest patents are invalid. Because KCI believes the Wake Forest patents are invalid, KCI filed a motion to dismiss its claims against ITI which the Court granted on August 30, 2013. | |
In December 2008, KCI, its affiliates and Wake Forest filed a patent infringement lawsuit against Boehringer Wound Systems, LLC, Boehringer Technologies, LP, and Convatec, Inc. in the U.S. District Court for the Middle District of North Carolina. The federal complaint alleged that a NPWT device manufactured by Boehringer and commercialized by Convatec infringed Wake Forest patents. In February 2009, the defendants filed their answer which includes affirmative defenses and counterclaims alleging non-infringement and invalidity of the Wake Forest patents. On June 3, 2013, the parties filed a stipulation of Dismissal with Prejudice. | |
In August 2013, Vital Needs International, L.P. ("Vital Needs") filed a Demand for Arbitration with the American Arbitration Association seeking to recover $100 million in damages against Kinetic Concepts, Inc. and KCI Licensing, Inc. based on a number of claims related to certain intellectual property rights sold by Vital Needs to KCI pursuant to an Acquisition Agreement dated June 2, 2006. Vital Needs alleges, among other things, breach of the Acquisition Agreement for failure to pay royalties on sales of KCI products. We do not believe any royalties are owed to Vital Needs for sales of KCI products, and we believe our defenses to Vital Needs' claims are meritorious. We intend to vigorously defend the arbitration, which is in its initial phase. | |
International Intellectual Property Litigation | |
In June 2007, Medela filed a patent nullity suit in the German Federal Patent Court against Wake Forest's German patent corresponding to European Patent No. EP0620720 (“the '720 Patent”). In March 2008 and February 2009, Mölnlycke Health Care AB and Smith & Nephew, respectively, joined the nullity suit against the '720 Patent. In March 2009, the German Federal Patent Court ruled that the claims of the '720 Patent were invalid and revoked the German patent corresponding to the '720 Patent. A hearing on Wake Forest's appeal, previously set for April 26, 2012 was postponed and reset for February 13, 2013. The nullity complaints were withdrawn the morning of the scheduled hearing pursuant to a settlement between Wake Forest and the nullity plaintiffs, and the hearing did not take place. Although the patent's statutory term expired in November 2012, the withdrawal of the nullity complaints resulted in a reinstatement of the '720 Patent in Germany. As a result, on July 10, 2013, KCI filed a separate suit to nullify the German part of the '720 Patent. | |
In March 2009, KCI and its affiliates and Wake Forest filed a patent infringement lawsuit asserting the Australian counterpart to the Wake Forest Patents against Smith & Nephew in the Federal Court of Australia, requesting preliminary injunctive relief to prohibit the commercialization of a Smith & Nephew negative pressure wound therapy dressing kit. A full trial on validity and infringement of the Wake Forest patent involved in the case was held in 2010. In September 2011, the Federal Court ruled the asserted claims to be invalid and not infringed by Smith & Nephew's product. Wake Forest appealed the decision and oral arguments were heard before the appellate court in May 2012. Following the settlement between Wake Forest and Smith & Nephew described above, the Federal Court dismissed the appeal on November 30, 2012 without addressing Wake Forest's appeal, and remitted the case to the lower court for costs and damages relating to the initial action filed in 2009. The dismissal renders the ruling of non-infringement and invalidity of the asserted claims final. The patent's statutory term expired in November 2012. | |
LifeCell Litigation | |
AlloDerm Cases | |
LifeCell Corporation is a party to approximately 330 lawsuits filed by individuals alleging personal injury and seeking monetary damages for failed hernia repair procedures using LifeCell Corporation's AlloDerm products. These cases have been consolidated for case management purposes in Middlesex County, New Jersey. The cases are in the early stages of litigation, and none have been set for trial. Although it is not possible to reliably predict the outcome of the litigation, we believe that our defenses to these claims are meritorious and we will defend against these suits vigorously. We have insurance that covers these claims and lawsuits. Recently, we resolved a dispute with our primary products liability carrier and these consolidated cases are being treated as a single occurrence and therefore do not require the exhaustion of a separate self-insured retention to trigger coverage. Based on our existing insurance coverage and our defenses to these cases, we do not expect them to have a material impact on our results of operations or our financial position. As these cases are in their early stages with much discovery still to be conducted, the plaintiffs have yet to set forth their alleged damages. As such, it is impossible for the Company to predict or estimate potential losses if our defenses to these cases are unsuccessful. | |
Repliform Cases | |
LifeCell Corporation has recently been named in approximately 80 lawsuits in Middlesex County, Massachusetts, but has been served with only 40 of the suits. In addition, LifeCell has been sued in State court in Delaware and Minnesota, as well as federal district court in Minneapolis and the Northern District of Texas. The cases were filed by individuals alleging personal injury and seeking monetary damages for failed gynecological procedures using products sold by Boston Scientific. The LifeCell cases in Middlesex County, Massachusetts were filed in the M Session of the Superior Court, which consists of a number of cases involving Boston Scientific synthetic mesh products. We do not believe LifeCell is a proper party to these lawsuits and are therefore seeking to dismiss these suits. In the event the suits are not dismissed we intend to defend these suits vigorously. We likewise intend to defend the non-Massachusettes cases vigorously. We have insurance that covers these claims and lawsuits. | |
LifeNet Health Case | |
On September 6, 2013, LifeNet Health ("LifeNet") filed suit against LifeCell Corporation in the United States District Court for the Eastern District of Virginia, Norfolk Division. LifeNet alleges that two LifeCell products, Strattice™ Reconstructive Tissue Matrix and AlloDerm®RTM Ready to Use, infringe LifeNet’s U.S. Patent No. 6,569,200 ("the ‘200 Patent"). LifeNet alleges that LifeCell has been aware of the ‘200 Patent and its infringement since 2009 and acted willfully in continuing to infringe the ‘200 Patent thereafter. LifeNet seeks monetary damages including treble damages for willful infringement, together with costs and prejudgment and post judgment interest as well as a finding that the case is exceptional and an award of costs and reasonable attorneys fees. LifeCell was served with the complaint on October 15, 2013 and intends to vigorously defend this case. | |
Other Litigation | |
In February 2009, KCI received a subpoena from the U.S. Department of Health and Human Services Office of Inspector General (“OIG”) seeking records regarding our billing practices under the local coverage policies of the four regional Durable Medical Equipment Medicare Administrative Contractors (“DME MACs”). KCI cooperated with the OIG's inquiry and provided substantial documentation to the OIG and the U.S. Attorneys' office in response to its request. The government's inquiry stemmed from the filing under seal of two qui tam actions against KCI on March 20, 2008 and September 29, 2008 by two former employees in the U.S. District Court, Central District of California, Western Division. These cases are captioned United States of America, ex rel. Steven J. Hartpence v. Kinetic Concepts, Inc. et al ("Hartpence Matter") and United States of America, ex rel. Geraldine Godecke v. Kinetic Concepts, Inc., et al ("Godecke Matter"). The complaints contend that KCI violated the Federal False Claims Act by billing in a manner that was not consistent with the Local Coverage Determinations issued by the DME MACs and seek recovery of monetary damages. Following the completion of the government's review and its decision declining to intervene in such suits, the live pleadings were ordered unsealed on May 3, 2011. After reviewing the allegations, KCI filed motions seeking the dismissal of the suits on multiple grounds. On January 30, 2012, the Court granted KCI's motions dismissing all of the claims in the Hartpence Matter and dismissing all of the claims in the Godecke Matter with the exception of a retaliation claim, which has been stayed pending the appeal of the dismissed claims. On February 27, 2012 and June 15, 2012, respectively, Hartpence and Godecke each filed a Notice of Appeal to the U.S. Court of Appeals for the Ninth Circuit seeking to reverse the dismissal of their claims by the trial court. On December 11, 2012, KCI moved the Ninth Circuit to disqualify counsel in the Hartpence and Godecke matters from representing relators on appeal due to their possession and use of KCI's privileged documents. The Ninth Circuit granted the parties agreed motion to stay the briefing of the merits of the appeals pending resolution of the disqualification motion and on February 25, 2013, remanded KCI's disqualification motion to the U.S. District Court for disposition. On May 20, 2013, the District Court granted KCI's disqualification motions and counsel for both Godecke and Hartpence were disqualified. On July 19, 2013 the Ninth Circuit Court of Appeals issued an Order requiring counsel for Godecke and Hartpence to withdraw from the appeals or show cause why they should not be disqualified. Godecke and Hartpence have retained new counsel to represent them on appeal. The Ninth Circuit has not issued a briefing schedule. | |
We are a party to several additional lawsuits arising in the ordinary course of our business. Additionally, the manufacturing and marketing of medical products necessarily entails an inherent risk of product liability claims. We maintain multiple layers of product liability insurance coverage and we believe these policies and the amounts of coverage are appropriate and adequate. | |
OTHER COMMITMENTS AND CONTINGENCIES | |
As a healthcare supplier, we are subject to extensive government regulation, including laws and regulations directed at ascertaining the appropriateness of reimbursement, preventing fraud and abuse and otherwise regulating reimbursement under various government programs. The marketing, billing, documenting and other practices are all subject to government oversight and review. To ensure compliance with Medicare and other regulations, regional carriers often conduct audits and request patient records and other documents to support claims submitted by us for payment of services rendered to customers. | |
We also are subject to routine pre-payment and post-payment audits of medical claims submitted to Medicare. These audits typically involve a review, by Medicare or its designated contractors and representatives, of documentation supporting the medical necessity of the therapy provided by us. While Medicare requires us to obtain a comprehensive physician order prior to providing products and services, we are not required to, and do not as a matter of practice require, or subsequently obtain, the underlying medical records supporting the information included in such claim. Following a Medicare request for supporting documentation, we are obligated to procure and submit the underlying medical records retained by various medical facilities and physicians. Obtaining these medical records in connection with a claims audit may be difficult or impossible and, in any event, all of these records are subject to further examination and dispute by an auditing authority. Under standard Medicare procedures, we are entitled to demonstrate the sufficiency of documentation and the establishment of medical necessity, and we have the right to appeal any adverse determinations. If a determination is made that our records or the patients' medical records are insufficient to meet medical necessity or Medicare reimbursement requirements for the claims subject to a pre-payment or post-payment audit, we could be subject to denial, recoupment or refund demands for claims submitted for Medicare reimbursement. In the event that an audit results in discrepancies in the records provided, Medicare may be entitled to extrapolate the results of the audit to make recoupment demands based on a wider population of claims than those examined in the audit. |
Segment_Information
Segment Information | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
SegmentandGeographicalInstruments [Abstract] | ' | |||||||||||||||
Segment Reporting Disclosure | ' | |||||||||||||||
Segment Information | ||||||||||||||||
The Company is engaged in the rental and sale of advanced wound care systems and regenerative medicine products and has operations in more than 25 countries. We have two reportable operating segments which correspond to our two global businesses: KCI and LifeCell. Our two global operating segments also represent our reporting units as defined by the Codification. In most countries where we operate, certain aspects of our two businesses are supported by the same administrative staff, systems and infrastructure and, as such, we have allocated these costs between the businesses based on allocation methods including headcount, revenue and other methods as deemed appropriate. We measure segment profit (loss) as operating earnings (loss), which is defined as income (loss) before interest and other income, interest expense, foreign currency gains and losses, derivative instruments gains and losses and income taxes. All intercompany transactions are eliminated in computing revenue and operating earnings (loss). | ||||||||||||||||
On November 8, 2012, Getinge purchased certain assets and assumed certain liabilities comprising KCI's TSS product business. The historical results of operations of the TSS business, excluding the allocation of general corporate overhead, are reported as discontinued operations in the condensed consolidated statements of operations. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement. | ||||||||||||||||
Information on segments and a reconciliation of consolidated totals are as follows (in thousands): | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenue: | ||||||||||||||||
KCI | $ | 320,879 | $ | 329,651 | $ | 944,526 | $ | 986,157 | ||||||||
LifeCell | 119,682 | 106,222 | 344,598 | 320,364 | ||||||||||||
Total revenue | $ | 440,561 | $ | 435,873 | $ | 1,289,124 | $ | 1,306,521 | ||||||||
Operating earnings (loss): | ||||||||||||||||
KCI | $ | 126,837 | $ | 114,833 | $ | 327,018 | $ | 277,191 | ||||||||
LifeCell | 30,093 | 28,864 | 91,159 | 75,503 | ||||||||||||
Non-allocated costs: | ||||||||||||||||
General headquarter expense (1) | (6,335 | ) | (5,520 | ) | (59,447 | ) | (19,545 | ) | ||||||||
Equity-based compensation | (850 | ) | (197 | ) | (2,046 | ) | (1,186 | ) | ||||||||
Merger and restructuring-related expenses (2) | (31,112 | ) | (21,684 | ) | (97,518 | ) | (63,750 | ) | ||||||||
Acquired intangible asset amortization (3) | (45,099 | ) | (49,733 | ) | (138,969 | ) | (172,260 | ) | ||||||||
Impairment of goodwill and intangible assets (4) | (443,400 | ) | — | (443,400 | ) | — | ||||||||||
Total non-allocated costs | (526,796 | ) | (77,134 | ) | (741,380 | ) | (256,741 | ) | ||||||||
Total operating earnings (loss) | $ | (369,866 | ) | $ | 66,563 | $ | (323,203 | ) | $ | 95,953 | ||||||
_____________________________ | ||||||||||||||||
-1 | The third quarter and nine months ended September 30, 2013 includes write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets due primarily to the discontinuation of certain projects. The nine months ended September 30, 2013 also includes a $30.3 million fixed asset impairment charge. The third quarter and nine months ended September 30, 2012 includes $9.7 million and $22.1 million, respectively, of impairment charges associated with certain production equipment at our AHS manufacturing plant and inventory associated with our V.A.C. Via product. | |||||||||||||||
-2 | Represents expenses related to the Merger including buyer and seller transaction costs, management fees and restructuring-related expenses. | |||||||||||||||
-3 | Includes amortization of acquired intangible assets related to our Merger in November 2011. | |||||||||||||||
-4 | During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit. |
Guarantor_Condensed_Consolidat
Guarantor Condensed Consolidating Financial Statements | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||
Guarantor Condensed Consolidating Financial Statements [Abstract] | ' | |||||||||||||||||||||||
Guarantor Condensed Consolidating Financial Statements | ' | |||||||||||||||||||||||
Guarantor Condensed Consolidating Financial Statements | ||||||||||||||||||||||||
Our 10.5% Second Lien Notes and 12.5% Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, by us and each of our material 100% owned subsidiaries, other than the subsidiaries that are co-issuers of the notes, foreign subsidiaries and subsidiaries whose only assets are investments in foreign subsidiaries. The non-guarantor subsidiaries do not have any payment obligations under the 10.5% Second Lien Notes or 12.5% Unsecured Notes. Subject to the terms of the10.5% Second Lien Notes and 12.5% Unsecured Notes indentures, the guarantee of a subsidiary guarantor will terminate upon: | ||||||||||||||||||||||||
-1 | a sale or other disposition (including by way of consolidation or merger) of the capital stock of such guarantor or the sale or disposition of all or substantially all the assets of such subsidiary guarantor (other than to the Company or a restricted subsidiary) otherwise permitted by the 10.5% Second Lien Notes or 12.5% Unsecured Notes indentures, | |||||||||||||||||||||||
-2 | the designation in accordance with the10.5% Second Lien Notes or 12.5% Unsecured Notes indenture of the guarantor as an unrestricted subsidiary or the occurrence of any event after which the guarantor is no longer a restricted subsidiary, | |||||||||||||||||||||||
-3 | defeasance or discharge of the10.5% Second Lien Notes or 12.5% Unsecured Notes, or | |||||||||||||||||||||||
-4 | upon the achievement of investment grade status by the10.5% Second Lien Notes or 12.5% Unsecured Notes; provided that such guarantee shall be reinstated upon the reversion date. | |||||||||||||||||||||||
In the event of a bankruptcy, liquidation or reorganization of any non-guarantor subsidiary, such non-guarantor subsidiary will pay the holders of its debt and other liabilities, including its trade creditors, before it will be able to distribute any of its assets to us. In the future, any non-U.S. subsidiaries, immaterial subsidiaries and subsidiaries that we designate as unrestricted subsidiaries under the 10.5% Second Lien Notes and 12.5% Unsecured Notes indentures will not guarantee the 10.5% Second Lien Notes or 12.5% Unsecured Notes. As of September 30, 2013, there were no restrictions on the ability of subsidiary guarantors to transfer funds to the parent company. | ||||||||||||||||||||||||
As a result of the guarantee arrangements, we are presenting the following condensed consolidated balance sheets, statements of operations and comprehensive income (loss), and statements of cash flows of the issuer, the guarantor subsidiaries and the non-guarantor subsidiaries. | ||||||||||||||||||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Balance Sheet | ||||||||||||||||||||||||
September 30, 2013 | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||
Cash and cash equivalents | $ | 398 | $ | 138,790 | $ | — | $ | 223,731 | $ | — | $ | 362,919 | ||||||||||||
Accounts receivable, net | — | 184,370 | 73,382 | 111,148 | — | 368,900 | ||||||||||||||||||
Inventories, net | — | 63,219 | 92,060 | 78,178 | (83,471 | ) | 149,986 | |||||||||||||||||
Prepaid expenses and other | — | 41,376 | 5,913 | 342,209 | (329,999 | ) | 59,499 | |||||||||||||||||
Intercompany receivables | 166 | 1,400,317 | 2,270,890 | 149,321 | (3,820,694 | ) | — | |||||||||||||||||
Total current assets | 564 | 1,828,072 | 2,442,245 | 904,587 | (4,234,164 | ) | 941,304 | |||||||||||||||||
Net property, plant and equipment | — | 297,648 | 82,391 | 197,071 | (264,555 | ) | 312,555 | |||||||||||||||||
Debt issuance costs, net | — | 101,766 | — | — | — | 101,766 | ||||||||||||||||||
Deferred income taxes | — | — | — | 21,866 | — | 21,866 | ||||||||||||||||||
Goodwill | — | 2,483,240 | 724,335 | — | — | 3,207,575 | ||||||||||||||||||
Identifiable intangible assets, net | — | 380,314 | 1,809,207 | 154,004 | — | 2,343,525 | ||||||||||||||||||
Other non-current assets | — | 424 | 186 | 94,344 | (90,900 | ) | 4,054 | |||||||||||||||||
Intercompany loan receivables | — | 785,000 | 404,586 | — | (1,189,586 | ) | — | |||||||||||||||||
Intercompany investments | 948,376 | 406,067 | 406,253 | — | (1,760,696 | ) | — | |||||||||||||||||
$ | 948,940 | $ | 6,282,531 | $ | 5,869,203 | $ | 1,371,872 | $ | (7,539,901 | ) | $ | 6,932,645 | ||||||||||||
Liabilities and Equity: | ||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||
Accounts payable | $ | — | $ | 16,089 | $ | 12,540 | $ | 15,898 | $ | — | $ | 44,527 | ||||||||||||
Accrued expenses and other | — | 234,359 | 238,528 | 61,948 | (182,932 | ) | 351,903 | |||||||||||||||||
Intercompany payables | 3,934 | 788,613 | 2,508,621 | 519,526 | (3,820,694 | ) | — | |||||||||||||||||
Current installments of long-term debt | — | 22,760 | 1,341 | — | — | 24,101 | ||||||||||||||||||
Income taxes payable | — | 1,495 | — | (1,495 | ) | — | — | |||||||||||||||||
Deferred income taxes | — | (34,267 | ) | 42,519 | (3,642 | ) | — | 4,610 | ||||||||||||||||
Total current liabilities | 3,934 | 1,029,049 | 2,803,549 | 592,235 | (4,003,626 | ) | 425,141 | |||||||||||||||||
Long-term debt, net of current installments and discount | — | 4,516,223 | 916 | — | — | 4,517,139 | ||||||||||||||||||
Non-current tax liabilities | — | 42,084 | — | 4,377 | — | 46,461 | ||||||||||||||||||
Deferred income taxes | — | 56,892 | 852,886 | 50,441 | — | 960,219 | ||||||||||||||||||
Other non-current liabilities | 218 | 37,242 | 298 | 1,139 | — | 38,897 | ||||||||||||||||||
Intercompany loan payables | — | 402,433 | 785,000 | 2,153 | (1,189,586 | ) | — | |||||||||||||||||
Total liabilities | 4,152 | 6,083,923 | 4,442,649 | 650,345 | (5,193,212 | ) | 5,987,857 | |||||||||||||||||
Total equity | 944,788 | 198,608 | 1,426,554 | 721,527 | (2,346,689 | ) | 944,788 | |||||||||||||||||
$ | 948,940 | $ | 6,282,531 | $ | 5,869,203 | $ | 1,371,872 | $ | (7,539,901 | ) | $ | 6,932,645 | ||||||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Balance Sheet | ||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||
Cash and cash equivalents | $ | 398 | $ | 276,788 | $ | — | $ | 105,964 | $ | — | $ | 383,150 | ||||||||||||
Accounts receivable, net | — | 174,534 | 58,244 | 122,940 | — | 355,718 | ||||||||||||||||||
Inventories, net | — | 94,345 | 71,676 | 60,635 | (86,806 | ) | 139,850 | |||||||||||||||||
Deferred income taxes | — | 38,451 | — | 3,642 | (42,093 | ) | — | |||||||||||||||||
Prepaid expenses and other | — | 25,083 | 6,591 | 294,437 | (286,600 | ) | 39,511 | |||||||||||||||||
Intercompany receivables | 166 | 1,337,915 | 2,149,981 | 147,473 | (3,635,535 | ) | — | |||||||||||||||||
Total current assets | 564 | 1,947,116 | 2,286,492 | 735,091 | (4,051,034 | ) | 918,229 | |||||||||||||||||
Net property, plant and equipment | — | 281,950 | 79,049 | 190,419 | (162,936 | ) | 388,482 | |||||||||||||||||
Debt issuance costs, net | — | 96,476 | — | — | — | 96,476 | ||||||||||||||||||
Deferred income taxes | — | — | — | 20,003 | — | 20,003 | ||||||||||||||||||
Goodwill | — | 2,483,240 | 996,535 | — | — | 3,479,775 | ||||||||||||||||||
Identifiable intangible assets, net | — | 441,620 | 2,045,091 | 179,490 | — | 2,666,201 | ||||||||||||||||||
Other non-current assets | — | 324 | 186 | 95,988 | (90,900 | ) | 5,598 | |||||||||||||||||
Intercompany loan receivables | — | 800,000 | 366,134 | — | (1,166,134 | ) | — | |||||||||||||||||
Intercompany investments | 1,459,261 | 302,027 | 409,702 | — | (2,170,990 | ) | — | |||||||||||||||||
$ | 1,459,825 | $ | 6,352,753 | $ | 6,183,189 | $ | 1,220,991 | $ | (7,641,994 | ) | $ | 7,574,764 | ||||||||||||
Liabilities and Equity: | ||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||
Accounts payable | $ | — | $ | 17,869 | $ | 13,093 | $ | 10,008 | $ | — | $ | 40,970 | ||||||||||||
Accrued expenses and other | — | 172,356 | 236,838 | 62,226 | (187,257 | ) | 284,163 | |||||||||||||||||
Intercompany payables | 2,361 | 723,096 | 2,389,863 | 520,215 | (3,635,535 | ) | — | |||||||||||||||||
Current installments of long-term debt | — | 23,383 | — | — | — | 23,383 | ||||||||||||||||||
Income taxes payable | — | (1,452 | ) | — | 1,452 | — | — | |||||||||||||||||
Deferred income taxes | — | — | 99,621 | — | (42,093 | ) | 57,528 | |||||||||||||||||
Total current liabilities | 2,361 | 935,252 | 2,739,415 | 593,901 | (3,864,885 | ) | 406,044 | |||||||||||||||||
Long-term debt, net of current installments and discount | — | 4,554,112 | — | — | — | 4,554,112 | ||||||||||||||||||
Non-current tax liabilities | — | 36,711 | — | 7,754 | — | 44,465 | ||||||||||||||||||
Deferred income taxes | — | 115,652 | 888,597 | 65,231 | — | 1,069,480 | ||||||||||||||||||
Other non-current liabilities | 68 | 41,360 | 375 | 1,464 | — | 43,267 | ||||||||||||||||||
Intercompany loan payables | — | 366,135 | 800,000 | — | (1,166,135 | ) | — | |||||||||||||||||
Total liabilities | 2,429 | 6,049,222 | 4,428,387 | 668,350 | (5,031,020 | ) | 6,117,368 | |||||||||||||||||
Total equity | 1,457,396 | 303,531 | 1,754,802 | 552,641 | (2,610,974 | ) | 1,457,396 | |||||||||||||||||
$ | 1,459,825 | $ | 6,352,753 | $ | 6,183,189 | $ | 1,220,991 | $ | (7,641,994 | ) | $ | 7,574,764 | ||||||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss) | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the three months ended September 30, 2013 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Rental | $ | — | $ | 155,893 | $ | 1,513 | $ | 33,635 | $ | — | $ | 191,041 | ||||||||||||
Sales | — | 77,659 | 224,426 | 159,142 | (211,707 | ) | 249,520 | |||||||||||||||||
Total revenue | — | 233,552 | 225,939 | 192,777 | (211,707 | ) | 440,561 | |||||||||||||||||
Rental expenses | — | 62,928 | 4,010 | 53,891 | (35,083 | ) | 85,746 | |||||||||||||||||
Cost of sales | 30 | 123,481 | 142,946 | 57,512 | (257,818 | ) | 66,151 | |||||||||||||||||
Gross profit (loss) | (30 | ) | 47,143 | 78,983 | 81,374 | 81,194 | 288,664 | |||||||||||||||||
Selling, general and administrative expenses | 820 | 66,834 | 44,169 | 40,261 | (31 | ) | 152,053 | |||||||||||||||||
Research and development expenses | — | 8,010 | 6,742 | 3,209 | — | 17,961 | ||||||||||||||||||
Acquired intangible asset amortization | — | 19,625 | 17,907 | 7,584 | — | 45,116 | ||||||||||||||||||
Impairment of goodwill and intangible assets | — | — | 443,400 | — | — | 443,400 | ||||||||||||||||||
Operating earnings (loss) | (850 | ) | (47,326 | ) | (433,235 | ) | 30,320 | 81,225 | (369,866 | ) | ||||||||||||||
Non-operating intercompany transactions | — | (8,076 | ) | 49,735 | (60,212 | ) | 18,553 | — | ||||||||||||||||
Interest income and other | — | 17,852 | 3,062 | 97 | (20,794 | ) | 217 | |||||||||||||||||
Interest expense | — | (104,402 | ) | (17,756 | ) | (34 | ) | 20,794 | (101,398 | ) | ||||||||||||||
Loss on extinguishment of debt | — | (200 | ) | — | — | — | (200 | ) | ||||||||||||||||
Foreign currency gain (loss) | — | (14,433 | ) | (38 | ) | 5,733 | — | (8,738 | ) | |||||||||||||||
Derivative instruments loss | — | (6,840 | ) | — | — | — | (6,840 | ) | ||||||||||||||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | (850 | ) | (163,425 | ) | (398,232 | ) | (24,096 | ) | 99,778 | (486,825 | ) | |||||||||||||
Income tax expense (benefit) | — | (51,104 | ) | (34,535 | ) | (2,880 | ) | — | (88,519 | ) | ||||||||||||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | (850 | ) | (112,321 | ) | (363,697 | ) | (21,216 | ) | 99,778 | (398,306 | ) | |||||||||||||
Equity in earnings (loss) of subsidiaries | (397,711 | ) | 48,780 | (20,950 | ) | — | 369,881 | — | ||||||||||||||||
Earnings (loss) from continuing operations | (398,561 | ) | (63,541 | ) | (384,647 | ) | (21,216 | ) | 469,659 | (398,306 | ) | |||||||||||||
Earnings (loss) from discontinued operations, net of tax | — | (331 | ) | (1 | ) | 266 | (189 | ) | (255 | ) | ||||||||||||||
Net earnings (loss) | $ | (398,561 | ) | $ | (63,872 | ) | $ | (384,648 | ) | $ | (20,950 | ) | $ | 469,470 | $ | (398,561 | ) | |||||||
Total comprehensive income (loss) | $ | (403,151 | ) | $ | (68,462 | ) | $ | (389,238 | ) | $ | (25,540 | ) | $ | 483,240 | $ | (403,151 | ) | |||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss) | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the three months ended September 30, 2012 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Rental | $ | — | $ | 164,641 | $ | 1,741 | $ | 40,774 | $ | — | $ | 207,156 | ||||||||||||
Sales | — | 74,943 | 103,716 | 151,225 | (101,167 | ) | 228,717 | |||||||||||||||||
Total revenue | — | 239,584 | 105,457 | 191,999 | (101,167 | ) | 435,873 | |||||||||||||||||
Rental expenses | — | 62,877 | 1,526 | 61,744 | (25,337 | ) | 100,810 | |||||||||||||||||
Cost of sales | 18 | 89,027 | 34,023 | 58,201 | (122,656 | ) | 58,613 | |||||||||||||||||
Gross profit (loss) | (18 | ) | 87,680 | 69,908 | 72,054 | 46,826 | 276,450 | |||||||||||||||||
Selling, general and administrative expenses | 191 | 75,731 | 32,926 | 33,978 | (48 | ) | 142,778 | |||||||||||||||||
Research and development expenses | — | 6,268 | 8,977 | 2,131 | — | 17,376 | ||||||||||||||||||
Acquired intangible asset amortization | — | 22,308 | 18,687 | 8,738 | — | 49,733 | ||||||||||||||||||
Operating earnings (loss) | (209 | ) | (16,627 | ) | 9,318 | 27,207 | 46,874 | 66,563 | ||||||||||||||||
Non-operating intercompany transactions | — | 5,318 | 132,861 | (131,367 | ) | (6,812 | ) | — | ||||||||||||||||
Interest income and other | — | 18,532 | 3,063 | 18 | (21,439 | ) | 174 | |||||||||||||||||
Interest expense | — | (120,964 | ) | (18,375 | ) | (20 | ) | 21,439 | (117,920 | ) | ||||||||||||||
Foreign currency gain (loss) | — | (6,651 | ) | 170 | 1,223 | — | (5,258 | ) | ||||||||||||||||
Derivative instruments loss | — | (8,579 | ) | — | — | — | (8,579 | ) | ||||||||||||||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | (209 | ) | (128,971 | ) | 127,037 | (102,939 | ) | 40,062 | (65,020 | ) | ||||||||||||||
Income tax expense (benefit) | — | (22,700 | ) | 14,055 | (18,531 | ) | — | (27,176 | ) | |||||||||||||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | (209 | ) | (106,271 | ) | 112,982 | (84,408 | ) | 40,062 | (37,844 | ) | ||||||||||||||
Equity in earnings (loss) of subsidiaries | (35,603 | ) | 28,741 | (83,578 | ) | — | 90,440 | — | ||||||||||||||||
Earnings (loss) from continuing operations | (35,812 | ) | (77,530 | ) | 29,404 | (84,408 | ) | 130,502 | (37,844 | ) | ||||||||||||||
Earnings (loss) from discontinued operations, net of tax | — | (1,468 | ) | 627 | 830 | 2,043 | 2,032 | |||||||||||||||||
Net earnings (loss) | $ | (35,812 | ) | $ | (78,998 | ) | $ | 30,031 | $ | (83,578 | ) | $ | 132,545 | $ | (35,812 | ) | ||||||||
Total comprehensive income (loss) | $ | (34,215 | ) | $ | (77,401 | ) | $ | 31,628 | $ | (81,981 | ) | $ | 127,754 | $ | (34,215 | ) | ||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss) | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the nine months ended September 30, 2013 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Rental | $ | — | $ | 461,605 | $ | 4,766 | $ | 103,078 | $ | — | $ | 569,449 | ||||||||||||
Sales | — | 221,296 | 640,681 | 481,490 | (623,792 | ) | 719,675 | |||||||||||||||||
Total revenue | — | 682,901 | 645,447 | 584,568 | (623,792 | ) | 1,289,124 | |||||||||||||||||
Rental expenses | 13 | 186,426 | 12,180 | 167,226 | (92,366 | ) | 273,479 | |||||||||||||||||
Cost of sales | 84 | 221,212 | 396,855 | 177,420 | (613,864 | ) | 181,707 | |||||||||||||||||
Gross profit (loss) | (97 | ) | 275,263 | 236,412 | 239,922 | 82,438 | 833,938 | |||||||||||||||||
Selling, general and administrative expenses | 1,949 | 269,490 | 136,734 | 110,515 | (210 | ) | 518,478 | |||||||||||||||||
Research and development expenses | — | 23,366 | 23,263 | 9,511 | — | 56,140 | ||||||||||||||||||
Acquired intangible asset amortization | — | 61,276 | 54,274 | 23,573 | — | 139,123 | ||||||||||||||||||
Impairment of goodwill and intangible assets | — | — | 443,400 | — | — | 443,400 | ||||||||||||||||||
Operating earnings (loss) | (2,046 | ) | (78,869 | ) | (421,259 | ) | 96,323 | 82,648 | (323,203 | ) | ||||||||||||||
Non-operating intercompany transactions | — | 52,176 | 108,489 | (112,565 | ) | (48,100 | ) | — | ||||||||||||||||
Interest income and other | — | 54,046 | 9,188 | 166 | (62,121 | ) | 1,279 | |||||||||||||||||
Interest expense | — | (324,163 | ) | (52,974 | ) | (128 | ) | 62,121 | (315,144 | ) | ||||||||||||||
Loss on extinguishment of debt | — | (2,364 | ) | — | — | — | (2,364 | ) | ||||||||||||||||
Foreign currency gain (loss) | — | (8,953 | ) | (251 | ) | (2,731 | ) | — | (11,935 | ) | ||||||||||||||
Derivative instruments gain | — | 3,200 | — | — | — | 3,200 | ||||||||||||||||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | (2,046 | ) | (304,927 | ) | (356,807 | ) | (18,935 | ) | 34,548 | (648,167 | ) | |||||||||||||
Income tax expense (benefit) | — | (97,201 | ) | (38,718 | ) | (8,624 | ) | — | (144,543 | ) | ||||||||||||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | (2,046 | ) | (207,726 | ) | (318,089 | ) | (10,311 | ) | 34,548 | (503,624 | ) | |||||||||||||
Equity in earnings (loss) of subsidiaries | (503,877 | ) | 104,040 | (10,136 | ) | — | 409,973 | — | ||||||||||||||||
Earnings (loss) from continuing operations | (505,923 | ) | (103,686 | ) | (328,225 | ) | (10,311 | ) | 444,521 | (503,624 | ) | |||||||||||||
Loss from discontinued operations, net of tax | — | (2,725 | ) | (3 | ) | 175 | 254 | (2,299 | ) | |||||||||||||||
Net earnings (loss) | $ | (505,923 | ) | $ | (106,411 | ) | $ | (328,228 | ) | $ | (10,136 | ) | $ | 444,775 | $ | (505,923 | ) | |||||||
Total comprehensive income (loss) | $ | (512,932 | ) | $ | (113,420 | ) | $ | (335,237 | ) | $ | (17,145 | ) | $ | 465,802 | $ | (512,932 | ) | |||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss) | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the nine months ended September 30, 2012 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Rental | $ | — | $ | 495,299 | $ | 4,507 | $ | 122,544 | $ | — | $ | 622,350 | ||||||||||||
Sales | — | 218,950 | 312,106 | 388,453 | (235,338 | ) | 684,171 | |||||||||||||||||
Total revenue | — | 714,249 | 316,613 | 510,997 | (235,338 | ) | 1,306,521 | |||||||||||||||||
Rental expenses | 2 | 227,119 | 4,088 | 201,240 | (84,062 | ) | 348,387 | |||||||||||||||||
Cost of sales | 54 | 196,056 | 108,774 | 174,747 | (289,177 | ) | 190,454 | |||||||||||||||||
Gross profit (loss) | (56 | ) | 291,074 | 203,751 | 135,010 | 137,901 | 767,680 | |||||||||||||||||
Selling, general and administrative expenses | 1,142 | 244,705 | 96,903 | 103,765 | (734 | ) | 445,781 | |||||||||||||||||
Research and development expenses | — | 20,222 | 26,676 | 6,788 | — | 53,686 | ||||||||||||||||||
Acquired intangible asset amortization | — | 81,085 | 59,273 | 31,902 | — | 172,260 | ||||||||||||||||||
Operating earnings (loss) | (1,198 | ) | (54,938 | ) | 20,899 | (7,445 | ) | 138,635 | 95,953 | |||||||||||||||
Non-operating intercompany transactions | — | 71,692 | 261,173 | (352,936 | ) | 20,071 | — | |||||||||||||||||
Interest income and other | — | 55,260 | 9,188 | 100 | (63,918 | ) | 630 | |||||||||||||||||
Interest expense | — | (362,215 | ) | (54,725 | ) | (85 | ) | 63,918 | (353,107 | ) | ||||||||||||||
Foreign currency gain (loss) | — | 2,470 | 318 | (2,360 | ) | — | 428 | |||||||||||||||||
Derivative instruments gain (loss) | — | (28,473 | ) | — | — | — | (28,473 | ) | ||||||||||||||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | (1,198 | ) | (316,204 | ) | 236,853 | (362,726 | ) | 158,706 | (284,569 | ) | ||||||||||||||
Income tax expense (benefit) | — | (61,959 | ) | (16,897 | ) | (28,269 | ) | — | (107,125 | ) | ||||||||||||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | (1,198 | ) | (254,245 | ) | 253,750 | (334,457 | ) | 158,706 | (177,444 | ) | ||||||||||||||
Equity in earnings (loss) of subsidiaries | (179,926 | ) | (73,757 | ) | (338,090 | ) | — | 591,773 | — | |||||||||||||||
Earnings (loss) from continuing operations | (181,124 | ) | (328,002 | ) | (84,340 | ) | (334,457 | ) | 750,479 | (177,444 | ) | |||||||||||||
Earnings (loss) from discontinued operations, net of tax | — | (8,761 | ) | 4,100 | (3,633 | ) | 4,614 | (3,680 | ) | |||||||||||||||
Net earnings (loss) | $ | (181,124 | ) | $ | (336,763 | ) | $ | (80,240 | ) | $ | (338,090 | ) | $ | 755,093 | $ | (181,124 | ) | |||||||
Total comprehensive income (loss) | $ | (182,711 | ) | $ | (338,350 | ) | $ | (81,827 | ) | $ | (339,677 | ) | $ | 759,854 | $ | (182,711 | ) | |||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Cash Flows | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the nine months ended September 30, 2013 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||||||
Net earnings (loss) | $ | (505,923 | ) | $ | (106,411 | ) | $ | (328,228 | ) | $ | (10,136 | ) | $ | 444,775 | $ | (505,923 | ) | |||||||
Adjustments to reconcile net earnings (loss) to net cash provided (used) by operating activities | 3,619 | 249,757 | 397,283 | 35,915 | (45,156 | ) | 641,418 | |||||||||||||||||
Net cash provided (used) by operating activities | (502,304 | ) | 143,346 | 69,055 | 25,779 | 399,619 | 135,495 | |||||||||||||||||
Cash flows from investing activities: | ||||||||||||||||||||||||
Net additions to property, plant and equipment | — | (145,714 | ) | (14,556 | ) | (98,591 | ) | 191,164 | (67,697 | ) | ||||||||||||||
Decrease (increase) in identifiable intangible assets and other non-current assets | — | (70 | ) | (4,474 | ) | 271 | — | (4,273 | ) | |||||||||||||||
Net cash provided (used) by investing activities | — | (145,784 | ) | (19,030 | ) | (98,320 | ) | 191,164 | (71,970 | ) | ||||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||||||
Distribution to limited partners | (1,572 | ) | — | — | — | — | (1,572 | ) | ||||||||||||||||
Repayments of long-term debt and capital lease obligations | — | (60,446 | ) | — | 17 | — | (60,429 | ) | ||||||||||||||||
Payment of debt issuance costs | — | (21,604 | ) | — | — | — | (21,604 | ) | ||||||||||||||||
Proceeds (payments) on intercompany loans | — | 51,298 | (53,452 | ) | 2,154 | — | — | |||||||||||||||||
Proceeds (payments) on intercompany investments | 503,876 | (104,808 | ) | 3,427 | 188,288 | (590,783 | ) | — | ||||||||||||||||
Net cash provided (used) by financing activities | 502,304 | (135,560 | ) | (50,025 | ) | 190,459 | (590,783 | ) | (83,605 | ) | ||||||||||||||
Effect of exchange rate changes on cash and cash equivalents | — | — | — | (151 | ) | — | (151 | ) | ||||||||||||||||
Net increase (decrease) in cash and cash equivalents | — | (137,998 | ) | — | 117,767 | — | (20,231 | ) | ||||||||||||||||
Cash and cash equivalents, beginning of period | 398 | 276,788 | — | 105,964 | — | 383,150 | ||||||||||||||||||
Cash and cash equivalents, end of period | $ | 398 | $ | 138,790 | $ | — | $ | 223,731 | $ | — | $ | 362,919 | ||||||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Cash Flows | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the nine months ended September 30, 2012 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||||||
Net earnings (loss) | $ | (181,124 | ) | $ | (336,763 | ) | $ | (80,240 | ) | $ | (338,090 | ) | $ | 755,093 | $ | (181,124 | ) | |||||||
Adjustments to reconcile net loss to net cash provided (used) by operating activities | 3,154 | 439,770 | (123,522 | ) | 153,344 | (105,747 | ) | 366,999 | ||||||||||||||||
Net cash provided (used) by operating activities | (177,970 | ) | 103,007 | (203,762 | ) | (184,746 | ) | 649,346 | 185,875 | |||||||||||||||
Cash flows from investing activities: | ||||||||||||||||||||||||
Net additions to property, plant and equipment | — | (57,203 | ) | (42,323 | ) | (39,328 | ) | 69,344 | (69,510 | ) | ||||||||||||||
Decrease (increase) in identifiable intangible assets and other non-current assets | — | 87 | (5,486 | ) | 19 | — | (5,380 | ) | ||||||||||||||||
Net cash provided (used) by investing activities | — | (57,116 | ) | (47,809 | ) | (39,309 | ) | 69,344 | (74,890 | ) | ||||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||||||
Capital contributions from limited partners | 239 | — | — | — | — | 239 | ||||||||||||||||||
Distribution to limited partners | (1,970 | ) | — | — | — | — | (1,970 | ) | ||||||||||||||||
Repayments of long-term debt and capital lease obligations | — | (17,508 | ) | — | 25 | — | (17,483 | ) | ||||||||||||||||
Proceeds (payments) on intercompany loans | — | (120,557 | ) | 45,537 | 75,020 | — | — | |||||||||||||||||
Payment of debt issuance costs | — | (578 | ) | — | — | — | (578 | ) | ||||||||||||||||
Proceeds (payments) on intercompany investments | 179,688 | 196,745 | 206,034 | 136,223 | (718,690 | ) | — | |||||||||||||||||
Net cash provided (used) by financing activities | 177,957 | 58,102 | 251,571 | 211,268 | (718,690 | ) | (19,792 | ) | ||||||||||||||||
Effect of exchange rate changes on cash and cash equivalents | — | — | — | 308 | — | 308 | ||||||||||||||||||
Net increase (decrease) in cash and cash equivalents | (13 | ) | 103,993 | — | (12,479 | ) | — | 91,501 | ||||||||||||||||
Cash and cash equivalents, beginning of period | 411 | 142,652 | — | 72,363 | — | 215,426 | ||||||||||||||||||
Cash and cash equivalents, end of period | $ | 398 | $ | 246,645 | $ | — | $ | 59,884 | $ | — | $ | 306,927 | ||||||||||||
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation and Principles of Consolidation | ' |
Basis of Presentation and Principles of Consolidation | |
The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP” or “the Codification”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information necessary for a fair presentation of results of operations, financial position and cash flows in conformity with GAAP. Operating results from interim periods are not necessarily indicative of results that may be expected for the fiscal year as a whole. The condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation of our results for the interim periods presented. Certain prior period amounts have been reclassified to conform to the 2013 presentation. | |
On August 15, 2012, KCI announced that it had entered into an asset purchase agreement with Getinge for the sale of KCI's Therapeutic Support Systems ("TSS") business (the “Agreement”). The transaction closed on November 8, 2012. The final adjusted purchase price paid by Getinge to KCI was $241.5 million. Under the terms of the Agreement, we agreed to provide transition services to Getinge after the close of the transaction. In accordance with the Codification, depreciation and amortization of the long-lived assets subject to the Agreement ceased as of August 15, 2012. Additionally, the results of the operations subject to the Agreement, excluding the allocation of general corporate overhead, are presented as discontinued operations in the condensed consolidated statements of operations for all periods presented. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement. | |
The Company has two reportable operating segments which correspond to our two global businesses: KCI and LifeCell Corporation ("LifeCell"). We have two primary geographic regions for which we provide supplemental information: the Americas, which is comprised principally of the United States and includes Canada, Puerto Rico and Latin America; and EMEA/APAC, which is comprised of Europe, the Middle East, Africa and the Asia Pacific region. | |
The condensed consolidated financial statements appearing in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012. | |
Derivative Financial Instruments and Fair Value Measurements | ' |
Derivative Financial Instruments and Fair Value Measurements | |
We use derivative financial instruments to manage the economic impact of fluctuations in interest rates. We do not use financial instruments for speculative or trading purposes. Periodically, we enter into interest rate protection agreements to modify the interest characteristics of our outstanding debt. Our interest rate derivatives have not been designated as hedging instruments, and as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. | |
We also use derivative financial instruments to manage the economic impact of fluctuations in currency exchange rates on our intercompany balances and corresponding cash flows and to manage our transactional currency exposures when our foreign subsidiaries enter into transactions denominated in currencies other than their local currency. We enter into foreign currency exchange contracts to manage these economic risks. These contracts are not designated as hedges; as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. Although we use master netting agreements with our derivative counterparties, we do not offset derivative asset and liability positions in the condensed consolidated balance sheets. | |
All derivative instruments are recorded on the balance sheets at fair value. The fair values of our interest rate derivatives and foreign currency exchange contracts are determined based on inputs that are readily available in public markets or can be derived from information available in publicly-quoted markets, which represent level 2 inputs as defined by the Codification. | |
Concentration of Credit Risk | ' |
Concentration of Credit Risk | |
We have a concentration of credit risk with financial institutions related to our derivative instruments. As of September 30, 2013, Morgan Stanley, UBS and HSBC were the counterparties on our interest rate protection agreements consisting of interest rate swap and cap agreements in notional amounts totaling $1.031 billion each. We use master netting agreements with our derivative counterparties to reduce our risk and use multiple counterparties to reduce our concentration of credit risk. | |
We maintain cash and cash equivalents with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. These deposits bear minimal credit risk as they are maintained at financial institutions of reputable credit and generally may be redeemed upon demand. | |
Recently Adopted Accounting Standards | ' |
Recently Adopted Accounting Standards | |
In January 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities." The objective of this guidance is to clarify offsetting disclosures that apply to accounting for derivatives and hedging, including bifurcated embedded derivatives, repurchase agreements, reverse repurchase agreements and securities lending transactions. This guidance is effective for fiscal years and interim periods beginning on or after January 1, 2013. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures. | |
In January 2013, the FASB issued ASU No. 2013-02 “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income." The objective of this guidance is to improve reporting of reclassifications out of accumulated other comprehensive income. The guidance does not change current requirements for reporting net income or other comprehensive income in financial statements. The guidance requires an entity to provide information about amounts reclassified out of accumulated other comprehensive income by component, and present either in the income statement or notes, significant amounts reclassified by the respective line items of net income. For public entities, this guidance is effective for reporting periods beginning after December 15, 2012. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures. | |
Property, Plant and Equipment, Impairment [Policy Text Block] | ' |
Long-Lived Assets | |
When an event occurs that indicates the carrying value of long-lived assets might not be recoverable, we review property, plant and equipment for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly. | |
Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block] | ' |
Goodwill and Other Intangible Assets | |
Goodwill represents the excess purchase price over the fair value of net assets acquired. Goodwill is tested for impairment by reporting unit annually, or more frequently when events or changes in circumstances indicate that the asset might be impaired. Impairment of goodwill is tested by comparing the carrying value of the reporting unit to the reporting unit’s fair value. The carrying value of each reporting unit is determined by taking the reported net assets of the consolidated entity, identifying reporting unit specific assets (including goodwill) and liabilities and allocating shared operational and administrative assets and liabilities to the appropriate reporting unit, which is the same as the segment to which they are assigned. The fair value of each reporting unit is determined using discounted cash flow models using certain performance assumptions and appropriate discount rates determined by our management. To ensure the reasonableness of the estimated fair value of our reporting units, we also consider current industry market multiples. When it is determined that the carrying value of goodwill may not be recoverable based upon the existence of one or more of the above indicators of impairment, the measurement of any impairment is determined and the carrying value is reduced as appropriate. | |
Identifiable intangible assets include developed technology, in process research and development, customer relationships, tradenames and patents. For intangible assets that are subject to amortization, we amortize the assets over the estimated economic or contractual life of the individual asset. When an event occurs that indicates the carrying value of definite-lived intangible assets might not be recoverable, we review the assets for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly. Indefinite-lived intangibles are tested for impairment annually, or more frequently when events or changes in circumstances indicate that the assets might be impaired. If the carrying amount of the indefinite-lived intangible assets exceeds their fair value, an impairment is recognized in an amount equal to that excess. | |
Other Significant Accounting Policies | ' |
Other Significant Accounting Policies | |
For further information on our significant accounting policies, see Note 1 of the notes to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012. |
Sale_of_Therapeutic_Support_Sy1
Sale of Therapeutic Support Systems Assets (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | |||||||||||||||
Operating results of the TSS product portfolio included in discontinued operations | ' | |||||||||||||||
The operating results of the TSS product portfolio included in discontinued operations are as follows (in thousands): | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenue | $ | — | $ | 52,673 | $ | — | $ | 168,107 | ||||||||
Earnings (loss) before income tax expense (benefit) | $ | (415 | ) | $ | 3,304 | $ | (3,738 | ) | $ | (5,984 | ) | |||||
Income tax expense (benefit) | $ | (160 | ) | $ | 1,272 | $ | (1,439 | ) | $ | (2,304 | ) | |||||
Gain (loss) from discontinued operations, net of tax | $ | (255 | ) | $ | 2,032 | $ | (2,299 | ) | $ | (3,680 | ) | |||||
Supplemental_Balance_Sheet_Dat1
Supplemental Balance Sheet Data (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Balance Sheet Related Disclosures [Abstract] | ' | |||||||
Schedule of Accounts Receivable, Net | ' | |||||||
Accounts receivable consist of the following (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Gross trade accounts receivable: | ||||||||
Billed trade accounts receivable | $ | 382,538 | $ | 370,708 | ||||
Unbilled receivables | 49,350 | 45,466 | ||||||
Less: Allowance for revenue adjustments | (69,546 | ) | (71,770 | ) | ||||
Gross trade accounts receivable | 362,342 | 344,404 | ||||||
Less: Allowance for bad debt | (7,017 | ) | (4,768 | ) | ||||
Net trade accounts receivable | 355,325 | 339,636 | ||||||
Other receivables | 13,575 | 16,082 | ||||||
$ | 368,900 | $ | 355,718 | |||||
Schedule of Inventories, Net | ' | |||||||
Inventories consist of the following (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Finished goods and tissue available for distribution | $ | 100,873 | $ | 96,573 | ||||
Goods and tissue in-process | 9,325 | 12,421 | ||||||
Raw materials, supplies, parts and unprocessed tissue | 66,033 | 45,993 | ||||||
176,231 | 154,987 | |||||||
Less: Amounts expected to be converted into equipment for short-term rental | (14,118 | ) | (5,237 | ) | ||||
Reserve for excess and obsolete inventory | (12,127 | ) | (9,900 | ) | ||||
$ | 149,986 | $ | 139,850 | |||||
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Schedule of Long-term Debt Instruments | ' | |||||||
Long-term debt consists of the following (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Senior Dollar Term D-1 Credit Facility (1) – due 2018 | $ | 1,601,607 | $ | 1,613,700 | ||||
Senior Euro Term D-1 Credit Facility (1) – due 2018 | 332,186 | 327,022 | ||||||
Senior Term D-2 Credit Facility (1) – due 2016 | 319,339 | 321,750 | ||||||
10.5% Second Lien Senior Secured Notes due 2018 | 1,750,000 | 1,750,000 | ||||||
12.5% Senior Unsecured Notes due 2019 | 612,000 | 650,000 | ||||||
3.25% Convertible Senior Notes due 2015 | 101 | 701 | ||||||
IBM Financing | 2,271 | — | ||||||
Notional amount of debt | 4,617,504 | 4,663,173 | ||||||
Senior Dollar Term D-1 Credit Facility Discount, net of accretion | (32,100 | ) | (33,840 | ) | ||||
Senior Euro Term D-1 Credit Facility Discount, net of accretion | (11,033 | ) | (13,353 | ) | ||||
Senior Term D-2 Credit Facility Discount, net of accretion | (4,860 | ) | (7,064 | ) | ||||
Second Lien Senior Secured Notes Discount, net of accretion | (25,160 | ) | (27,827 | ) | ||||
Senior Unsecured Notes Discount, net of accretion | (3,111 | ) | (3,594 | ) | ||||
Net discount on debt | (76,264 | ) | (85,678 | ) | ||||
Total debt, net of discount | 4,541,240 | 4,577,495 | ||||||
Less: Current installments | (24,101 | ) | (23,383 | ) | ||||
$ | 4,517,139 | $ | 4,554,112 | |||||
_____________________________ | ||||||||
(1) On June 14, 2013, we entered into Amendment No. 2 to our senior secured credit facility. As a result of the amendment we created new classes of Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, having the same rights and obligations as the Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans as set forth in the Credit Agreement and Loan Documents, except as revised by the amendment. |
Derivative_Financial_Instrumen1
Derivative Financial Instruments and Fair Value Measurements (Tables) | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||
Derivative [Line Items] | ' | |||||||||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | ' | |||||||||||||||||||
The following table sets forth the location and aggregate fair value amounts of all derivative instruments with credit-related contingent features (in thousands): | ||||||||||||||||||||
Asset Derivatives | Liability Derivatives | |||||||||||||||||||
Balance | Fair Value | Balance | Fair Value | |||||||||||||||||
Sheet | Sheet | |||||||||||||||||||
Location | September 30, | December 31, | Location | September 30, | December 31, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||||||
Interest rate swap agreements | Prepaid expenses and other | $ | — | $ | — | Accrued expenses and other | $ | 330 | $ | — | ||||||||||
Interest rate swap agreements | Other non-current assets | — | — | Other non-current liabilities | 30,482 | 34,868 | ||||||||||||||
Interest rate cap agreements | Prepaid expenses and other | — | 9 | Accrued expenses and other | — | — | ||||||||||||||
Foreign currency exchange contracts | Prepaid expenses and other | 230 | 520 | Accrued expenses and other | 1,008 | 2,980 | ||||||||||||||
Total derivatives | $ | 230 | $ | 529 | $ | 31,820 | $ | 37,848 | ||||||||||||
Not Designated as Hedging Instrument [Member] | ' | |||||||||||||||||||
Derivative [Line Items] | ' | |||||||||||||||||||
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance | ' | |||||||||||||||||||
The following table summarizes the amount of gain (loss) on derivatives not designated as hedging instruments (dollars in thousands): | ||||||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
Interest rate swap agreements | $ | (5,195 | ) | $ | (6,313 | ) | $ | 4,057 | $ | (24,610 | ) | |||||||||
Interest rate cap agreements | (4 | ) | (118 | ) | (9 | ) | (1,563 | ) | ||||||||||||
Foreign currency exchange contracts | (1,641 | ) | (2,148 | ) | (848 | ) | (2,300 | ) | ||||||||||||
$ | (6,840 | ) | $ | (8,579 | ) | $ | 3,200 | $ | (28,473 | ) | ||||||||||
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | ' | |||||||||||||||||||
Derivative [Line Items] | ' | |||||||||||||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions | ' | |||||||||||||||||||
The following table summarizes our interest rate swap agreements (dollars in thousands): | ||||||||||||||||||||
Effective Dates | Original Notional Amount | Fixed Interest Rate | ||||||||||||||||||
12/31/13-12/31/16 | $512,633 | 2.26% | ||||||||||||||||||
12/31/13-12/31/16 | $512,633 | 2.25% | ||||||||||||||||||
12/31/13-12/31/16 | $512,633 | 2.25% |
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | ' | |||||||||||
The components of accumulated other comprehensive loss are as follows (in thousands): | ||||||||||||
Accumulated | Investment Gain | Accumulated | ||||||||||
Foreign | Other | |||||||||||
Currency | Comprehensive | |||||||||||
Translation | Income (Loss) | |||||||||||
Adjustment | ||||||||||||
Balances at December 31, 2012 | $ | (517 | ) | $ | — | $ | (517 | ) | ||||
Unrealized investment gain, net of tax expense of $1,413 | — | 2,257 | 2,257 | |||||||||
Foreign currency translation adjustment, net of tax benefit of $259 | (9,266 | ) | — | (9,266 | ) | |||||||
Balances at September 30, 2013 | $ | (9,783 | ) | $ | 2,257 | $ | (7,526 | ) | ||||
Segment_Information_Tables
Segment Information (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Reconciliation of Revenue and Operating Earnings (Loss) from Segments to Consolidated | ' | |||||||||||||||
Information on segments and a reconciliation of consolidated totals are as follows (in thousands): | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenue: | ||||||||||||||||
KCI | $ | 320,879 | $ | 329,651 | $ | 944,526 | $ | 986,157 | ||||||||
LifeCell | 119,682 | 106,222 | 344,598 | 320,364 | ||||||||||||
Total revenue | $ | 440,561 | $ | 435,873 | $ | 1,289,124 | $ | 1,306,521 | ||||||||
Operating earnings (loss): | ||||||||||||||||
KCI | $ | 126,837 | $ | 114,833 | $ | 327,018 | $ | 277,191 | ||||||||
LifeCell | 30,093 | 28,864 | 91,159 | 75,503 | ||||||||||||
Non-allocated costs: | ||||||||||||||||
General headquarter expense (1) | (6,335 | ) | (5,520 | ) | (59,447 | ) | (19,545 | ) | ||||||||
Equity-based compensation | (850 | ) | (197 | ) | (2,046 | ) | (1,186 | ) | ||||||||
Merger and restructuring-related expenses (2) | (31,112 | ) | (21,684 | ) | (97,518 | ) | (63,750 | ) | ||||||||
Acquired intangible asset amortization (3) | (45,099 | ) | (49,733 | ) | (138,969 | ) | (172,260 | ) | ||||||||
Impairment of goodwill and intangible assets (4) | (443,400 | ) | — | (443,400 | ) | — | ||||||||||
Total non-allocated costs | (526,796 | ) | (77,134 | ) | (741,380 | ) | (256,741 | ) | ||||||||
Total operating earnings (loss) | $ | (369,866 | ) | $ | 66,563 | $ | (323,203 | ) | $ | 95,953 | ||||||
_____________________________ | ||||||||||||||||
-1 | The third quarter and nine months ended September 30, 2013 includes write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets due primarily to the discontinuation of certain projects. The nine months ended September 30, 2013 also includes a $30.3 million fixed asset impairment charge. The third quarter and nine months ended September 30, 2012 includes $9.7 million and $22.1 million, respectively, of impairment charges associated with certain production equipment at our AHS manufacturing plant and inventory associated with our V.A.C. Via product. | |||||||||||||||
-2 | Represents expenses related to the Merger including buyer and seller transaction costs, management fees and restructuring-related expenses. | |||||||||||||||
-3 | Includes amortization of acquired intangible assets related to our Merger in November 2011. | |||||||||||||||
-4 | During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit. |
Guarantor_Condensed_Consolidat1
Guarantor Condensed Consolidating Financial Statements (Tables) | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||
Guarantor Condensed Consolidating Financial Statements [Abstract] | ' | |||||||||||||||||||||||
Guarantor and Non-Guarantor Balance Sheet | ' | |||||||||||||||||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Balance Sheet | ||||||||||||||||||||||||
September 30, 2013 | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||
Cash and cash equivalents | $ | 398 | $ | 138,790 | $ | — | $ | 223,731 | $ | — | $ | 362,919 | ||||||||||||
Accounts receivable, net | — | 184,370 | 73,382 | 111,148 | — | 368,900 | ||||||||||||||||||
Inventories, net | — | 63,219 | 92,060 | 78,178 | (83,471 | ) | 149,986 | |||||||||||||||||
Prepaid expenses and other | — | 41,376 | 5,913 | 342,209 | (329,999 | ) | 59,499 | |||||||||||||||||
Intercompany receivables | 166 | 1,400,317 | 2,270,890 | 149,321 | (3,820,694 | ) | — | |||||||||||||||||
Total current assets | 564 | 1,828,072 | 2,442,245 | 904,587 | (4,234,164 | ) | 941,304 | |||||||||||||||||
Net property, plant and equipment | — | 297,648 | 82,391 | 197,071 | (264,555 | ) | 312,555 | |||||||||||||||||
Debt issuance costs, net | — | 101,766 | — | — | — | 101,766 | ||||||||||||||||||
Deferred income taxes | — | — | — | 21,866 | — | 21,866 | ||||||||||||||||||
Goodwill | — | 2,483,240 | 724,335 | — | — | 3,207,575 | ||||||||||||||||||
Identifiable intangible assets, net | — | 380,314 | 1,809,207 | 154,004 | — | 2,343,525 | ||||||||||||||||||
Other non-current assets | — | 424 | 186 | 94,344 | (90,900 | ) | 4,054 | |||||||||||||||||
Intercompany loan receivables | — | 785,000 | 404,586 | — | (1,189,586 | ) | — | |||||||||||||||||
Intercompany investments | 948,376 | 406,067 | 406,253 | — | (1,760,696 | ) | — | |||||||||||||||||
$ | 948,940 | $ | 6,282,531 | $ | 5,869,203 | $ | 1,371,872 | $ | (7,539,901 | ) | $ | 6,932,645 | ||||||||||||
Liabilities and Equity: | ||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||
Accounts payable | $ | — | $ | 16,089 | $ | 12,540 | $ | 15,898 | $ | — | $ | 44,527 | ||||||||||||
Accrued expenses and other | — | 234,359 | 238,528 | 61,948 | (182,932 | ) | 351,903 | |||||||||||||||||
Intercompany payables | 3,934 | 788,613 | 2,508,621 | 519,526 | (3,820,694 | ) | — | |||||||||||||||||
Current installments of long-term debt | — | 22,760 | 1,341 | — | — | 24,101 | ||||||||||||||||||
Income taxes payable | — | 1,495 | — | (1,495 | ) | — | — | |||||||||||||||||
Deferred income taxes | — | (34,267 | ) | 42,519 | (3,642 | ) | — | 4,610 | ||||||||||||||||
Total current liabilities | 3,934 | 1,029,049 | 2,803,549 | 592,235 | (4,003,626 | ) | 425,141 | |||||||||||||||||
Long-term debt, net of current installments and discount | — | 4,516,223 | 916 | — | — | 4,517,139 | ||||||||||||||||||
Non-current tax liabilities | — | 42,084 | — | 4,377 | — | 46,461 | ||||||||||||||||||
Deferred income taxes | — | 56,892 | 852,886 | 50,441 | — | 960,219 | ||||||||||||||||||
Other non-current liabilities | 218 | 37,242 | 298 | 1,139 | — | 38,897 | ||||||||||||||||||
Intercompany loan payables | — | 402,433 | 785,000 | 2,153 | (1,189,586 | ) | — | |||||||||||||||||
Total liabilities | 4,152 | 6,083,923 | 4,442,649 | 650,345 | (5,193,212 | ) | 5,987,857 | |||||||||||||||||
Total equity | 944,788 | 198,608 | 1,426,554 | 721,527 | (2,346,689 | ) | 944,788 | |||||||||||||||||
$ | 948,940 | $ | 6,282,531 | $ | 5,869,203 | $ | 1,371,872 | $ | (7,539,901 | ) | $ | 6,932,645 | ||||||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Balance Sheet | ||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||
Cash and cash equivalents | $ | 398 | $ | 276,788 | $ | — | $ | 105,964 | $ | — | $ | 383,150 | ||||||||||||
Accounts receivable, net | — | 174,534 | 58,244 | 122,940 | — | 355,718 | ||||||||||||||||||
Inventories, net | — | 94,345 | 71,676 | 60,635 | (86,806 | ) | 139,850 | |||||||||||||||||
Deferred income taxes | — | 38,451 | — | 3,642 | (42,093 | ) | — | |||||||||||||||||
Prepaid expenses and other | — | 25,083 | 6,591 | 294,437 | (286,600 | ) | 39,511 | |||||||||||||||||
Intercompany receivables | 166 | 1,337,915 | 2,149,981 | 147,473 | (3,635,535 | ) | — | |||||||||||||||||
Total current assets | 564 | 1,947,116 | 2,286,492 | 735,091 | (4,051,034 | ) | 918,229 | |||||||||||||||||
Net property, plant and equipment | — | 281,950 | 79,049 | 190,419 | (162,936 | ) | 388,482 | |||||||||||||||||
Debt issuance costs, net | — | 96,476 | — | — | — | 96,476 | ||||||||||||||||||
Deferred income taxes | — | — | — | 20,003 | — | 20,003 | ||||||||||||||||||
Goodwill | — | 2,483,240 | 996,535 | — | — | 3,479,775 | ||||||||||||||||||
Identifiable intangible assets, net | — | 441,620 | 2,045,091 | 179,490 | — | 2,666,201 | ||||||||||||||||||
Other non-current assets | — | 324 | 186 | 95,988 | (90,900 | ) | 5,598 | |||||||||||||||||
Intercompany loan receivables | — | 800,000 | 366,134 | — | (1,166,134 | ) | — | |||||||||||||||||
Intercompany investments | 1,459,261 | 302,027 | 409,702 | — | (2,170,990 | ) | — | |||||||||||||||||
$ | 1,459,825 | $ | 6,352,753 | $ | 6,183,189 | $ | 1,220,991 | $ | (7,641,994 | ) | $ | 7,574,764 | ||||||||||||
Liabilities and Equity: | ||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||
Accounts payable | $ | — | $ | 17,869 | $ | 13,093 | $ | 10,008 | $ | — | $ | 40,970 | ||||||||||||
Accrued expenses and other | — | 172,356 | 236,838 | 62,226 | (187,257 | ) | 284,163 | |||||||||||||||||
Intercompany payables | 2,361 | 723,096 | 2,389,863 | 520,215 | (3,635,535 | ) | — | |||||||||||||||||
Current installments of long-term debt | — | 23,383 | — | — | — | 23,383 | ||||||||||||||||||
Income taxes payable | — | (1,452 | ) | — | 1,452 | — | — | |||||||||||||||||
Deferred income taxes | — | — | 99,621 | — | (42,093 | ) | 57,528 | |||||||||||||||||
Total current liabilities | 2,361 | 935,252 | 2,739,415 | 593,901 | (3,864,885 | ) | 406,044 | |||||||||||||||||
Long-term debt, net of current installments and discount | — | 4,554,112 | — | — | — | 4,554,112 | ||||||||||||||||||
Non-current tax liabilities | — | 36,711 | — | 7,754 | — | 44,465 | ||||||||||||||||||
Deferred income taxes | — | 115,652 | 888,597 | 65,231 | — | 1,069,480 | ||||||||||||||||||
Other non-current liabilities | 68 | 41,360 | 375 | 1,464 | — | 43,267 | ||||||||||||||||||
Intercompany loan payables | — | 366,135 | 800,000 | — | (1,166,135 | ) | — | |||||||||||||||||
Total liabilities | 2,429 | 6,049,222 | 4,428,387 | 668,350 | (5,031,020 | ) | 6,117,368 | |||||||||||||||||
Total equity | 1,457,396 | 303,531 | 1,754,802 | 552,641 | (2,610,974 | ) | 1,457,396 | |||||||||||||||||
$ | 1,459,825 | $ | 6,352,753 | $ | 6,183,189 | $ | 1,220,991 | $ | (7,641,994 | ) | $ | 7,574,764 | ||||||||||||
Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss) | ' | |||||||||||||||||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss) | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the three months ended September 30, 2013 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Rental | $ | — | $ | 155,893 | $ | 1,513 | $ | 33,635 | $ | — | $ | 191,041 | ||||||||||||
Sales | — | 77,659 | 224,426 | 159,142 | (211,707 | ) | 249,520 | |||||||||||||||||
Total revenue | — | 233,552 | 225,939 | 192,777 | (211,707 | ) | 440,561 | |||||||||||||||||
Rental expenses | — | 62,928 | 4,010 | 53,891 | (35,083 | ) | 85,746 | |||||||||||||||||
Cost of sales | 30 | 123,481 | 142,946 | 57,512 | (257,818 | ) | 66,151 | |||||||||||||||||
Gross profit (loss) | (30 | ) | 47,143 | 78,983 | 81,374 | 81,194 | 288,664 | |||||||||||||||||
Selling, general and administrative expenses | 820 | 66,834 | 44,169 | 40,261 | (31 | ) | 152,053 | |||||||||||||||||
Research and development expenses | — | 8,010 | 6,742 | 3,209 | — | 17,961 | ||||||||||||||||||
Acquired intangible asset amortization | — | 19,625 | 17,907 | 7,584 | — | 45,116 | ||||||||||||||||||
Impairment of goodwill and intangible assets | — | — | 443,400 | — | — | 443,400 | ||||||||||||||||||
Operating earnings (loss) | (850 | ) | (47,326 | ) | (433,235 | ) | 30,320 | 81,225 | (369,866 | ) | ||||||||||||||
Non-operating intercompany transactions | — | (8,076 | ) | 49,735 | (60,212 | ) | 18,553 | — | ||||||||||||||||
Interest income and other | — | 17,852 | 3,062 | 97 | (20,794 | ) | 217 | |||||||||||||||||
Interest expense | — | (104,402 | ) | (17,756 | ) | (34 | ) | 20,794 | (101,398 | ) | ||||||||||||||
Loss on extinguishment of debt | — | (200 | ) | — | — | — | (200 | ) | ||||||||||||||||
Foreign currency gain (loss) | — | (14,433 | ) | (38 | ) | 5,733 | — | (8,738 | ) | |||||||||||||||
Derivative instruments loss | — | (6,840 | ) | — | — | — | (6,840 | ) | ||||||||||||||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | (850 | ) | (163,425 | ) | (398,232 | ) | (24,096 | ) | 99,778 | (486,825 | ) | |||||||||||||
Income tax expense (benefit) | — | (51,104 | ) | (34,535 | ) | (2,880 | ) | — | (88,519 | ) | ||||||||||||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | (850 | ) | (112,321 | ) | (363,697 | ) | (21,216 | ) | 99,778 | (398,306 | ) | |||||||||||||
Equity in earnings (loss) of subsidiaries | (397,711 | ) | 48,780 | (20,950 | ) | — | 369,881 | — | ||||||||||||||||
Earnings (loss) from continuing operations | (398,561 | ) | (63,541 | ) | (384,647 | ) | (21,216 | ) | 469,659 | (398,306 | ) | |||||||||||||
Earnings (loss) from discontinued operations, net of tax | — | (331 | ) | (1 | ) | 266 | (189 | ) | (255 | ) | ||||||||||||||
Net earnings (loss) | $ | (398,561 | ) | $ | (63,872 | ) | $ | (384,648 | ) | $ | (20,950 | ) | $ | 469,470 | $ | (398,561 | ) | |||||||
Total comprehensive income (loss) | $ | (403,151 | ) | $ | (68,462 | ) | $ | (389,238 | ) | $ | (25,540 | ) | $ | 483,240 | $ | (403,151 | ) | |||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss) | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the three months ended September 30, 2012 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Rental | $ | — | $ | 164,641 | $ | 1,741 | $ | 40,774 | $ | — | $ | 207,156 | ||||||||||||
Sales | — | 74,943 | 103,716 | 151,225 | (101,167 | ) | 228,717 | |||||||||||||||||
Total revenue | — | 239,584 | 105,457 | 191,999 | (101,167 | ) | 435,873 | |||||||||||||||||
Rental expenses | — | 62,877 | 1,526 | 61,744 | (25,337 | ) | 100,810 | |||||||||||||||||
Cost of sales | 18 | 89,027 | 34,023 | 58,201 | (122,656 | ) | 58,613 | |||||||||||||||||
Gross profit (loss) | (18 | ) | 87,680 | 69,908 | 72,054 | 46,826 | 276,450 | |||||||||||||||||
Selling, general and administrative expenses | 191 | 75,731 | 32,926 | 33,978 | (48 | ) | 142,778 | |||||||||||||||||
Research and development expenses | — | 6,268 | 8,977 | 2,131 | — | 17,376 | ||||||||||||||||||
Acquired intangible asset amortization | — | 22,308 | 18,687 | 8,738 | — | 49,733 | ||||||||||||||||||
Operating earnings (loss) | (209 | ) | (16,627 | ) | 9,318 | 27,207 | 46,874 | 66,563 | ||||||||||||||||
Non-operating intercompany transactions | — | 5,318 | 132,861 | (131,367 | ) | (6,812 | ) | — | ||||||||||||||||
Interest income and other | — | 18,532 | 3,063 | 18 | (21,439 | ) | 174 | |||||||||||||||||
Interest expense | — | (120,964 | ) | (18,375 | ) | (20 | ) | 21,439 | (117,920 | ) | ||||||||||||||
Foreign currency gain (loss) | — | (6,651 | ) | 170 | 1,223 | — | (5,258 | ) | ||||||||||||||||
Derivative instruments loss | — | (8,579 | ) | — | — | — | (8,579 | ) | ||||||||||||||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | (209 | ) | (128,971 | ) | 127,037 | (102,939 | ) | 40,062 | (65,020 | ) | ||||||||||||||
Income tax expense (benefit) | — | (22,700 | ) | 14,055 | (18,531 | ) | — | (27,176 | ) | |||||||||||||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | (209 | ) | (106,271 | ) | 112,982 | (84,408 | ) | 40,062 | (37,844 | ) | ||||||||||||||
Equity in earnings (loss) of subsidiaries | (35,603 | ) | 28,741 | (83,578 | ) | — | 90,440 | — | ||||||||||||||||
Earnings (loss) from continuing operations | (35,812 | ) | (77,530 | ) | 29,404 | (84,408 | ) | 130,502 | (37,844 | ) | ||||||||||||||
Earnings (loss) from discontinued operations, net of tax | — | (1,468 | ) | 627 | 830 | 2,043 | 2,032 | |||||||||||||||||
Net earnings (loss) | $ | (35,812 | ) | $ | (78,998 | ) | $ | 30,031 | $ | (83,578 | ) | $ | 132,545 | $ | (35,812 | ) | ||||||||
Total comprehensive income (loss) | $ | (34,215 | ) | $ | (77,401 | ) | $ | 31,628 | $ | (81,981 | ) | $ | 127,754 | $ | (34,215 | ) | ||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss) | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the nine months ended September 30, 2013 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Rental | $ | — | $ | 461,605 | $ | 4,766 | $ | 103,078 | $ | — | $ | 569,449 | ||||||||||||
Sales | — | 221,296 | 640,681 | 481,490 | (623,792 | ) | 719,675 | |||||||||||||||||
Total revenue | — | 682,901 | 645,447 | 584,568 | (623,792 | ) | 1,289,124 | |||||||||||||||||
Rental expenses | 13 | 186,426 | 12,180 | 167,226 | (92,366 | ) | 273,479 | |||||||||||||||||
Cost of sales | 84 | 221,212 | 396,855 | 177,420 | (613,864 | ) | 181,707 | |||||||||||||||||
Gross profit (loss) | (97 | ) | 275,263 | 236,412 | 239,922 | 82,438 | 833,938 | |||||||||||||||||
Selling, general and administrative expenses | 1,949 | 269,490 | 136,734 | 110,515 | (210 | ) | 518,478 | |||||||||||||||||
Research and development expenses | — | 23,366 | 23,263 | 9,511 | — | 56,140 | ||||||||||||||||||
Acquired intangible asset amortization | — | 61,276 | 54,274 | 23,573 | — | 139,123 | ||||||||||||||||||
Impairment of goodwill and intangible assets | — | — | 443,400 | — | — | 443,400 | ||||||||||||||||||
Operating earnings (loss) | (2,046 | ) | (78,869 | ) | (421,259 | ) | 96,323 | 82,648 | (323,203 | ) | ||||||||||||||
Non-operating intercompany transactions | — | 52,176 | 108,489 | (112,565 | ) | (48,100 | ) | — | ||||||||||||||||
Interest income and other | — | 54,046 | 9,188 | 166 | (62,121 | ) | 1,279 | |||||||||||||||||
Interest expense | — | (324,163 | ) | (52,974 | ) | (128 | ) | 62,121 | (315,144 | ) | ||||||||||||||
Loss on extinguishment of debt | — | (2,364 | ) | — | — | — | (2,364 | ) | ||||||||||||||||
Foreign currency gain (loss) | — | (8,953 | ) | (251 | ) | (2,731 | ) | — | (11,935 | ) | ||||||||||||||
Derivative instruments gain | — | 3,200 | — | — | — | 3,200 | ||||||||||||||||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | (2,046 | ) | (304,927 | ) | (356,807 | ) | (18,935 | ) | 34,548 | (648,167 | ) | |||||||||||||
Income tax expense (benefit) | — | (97,201 | ) | (38,718 | ) | (8,624 | ) | — | (144,543 | ) | ||||||||||||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | (2,046 | ) | (207,726 | ) | (318,089 | ) | (10,311 | ) | 34,548 | (503,624 | ) | |||||||||||||
Equity in earnings (loss) of subsidiaries | (503,877 | ) | 104,040 | (10,136 | ) | — | 409,973 | — | ||||||||||||||||
Earnings (loss) from continuing operations | (505,923 | ) | (103,686 | ) | (328,225 | ) | (10,311 | ) | 444,521 | (503,624 | ) | |||||||||||||
Loss from discontinued operations, net of tax | — | (2,725 | ) | (3 | ) | 175 | 254 | (2,299 | ) | |||||||||||||||
Net earnings (loss) | $ | (505,923 | ) | $ | (106,411 | ) | $ | (328,228 | ) | $ | (10,136 | ) | $ | 444,775 | $ | (505,923 | ) | |||||||
Total comprehensive income (loss) | $ | (512,932 | ) | $ | (113,420 | ) | $ | (335,237 | ) | $ | (17,145 | ) | $ | 465,802 | $ | (512,932 | ) | |||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss) | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the nine months ended September 30, 2012 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Rental | $ | — | $ | 495,299 | $ | 4,507 | $ | 122,544 | $ | — | $ | 622,350 | ||||||||||||
Sales | — | 218,950 | 312,106 | 388,453 | (235,338 | ) | 684,171 | |||||||||||||||||
Total revenue | — | 714,249 | 316,613 | 510,997 | (235,338 | ) | 1,306,521 | |||||||||||||||||
Rental expenses | 2 | 227,119 | 4,088 | 201,240 | (84,062 | ) | 348,387 | |||||||||||||||||
Cost of sales | 54 | 196,056 | 108,774 | 174,747 | (289,177 | ) | 190,454 | |||||||||||||||||
Gross profit (loss) | (56 | ) | 291,074 | 203,751 | 135,010 | 137,901 | 767,680 | |||||||||||||||||
Selling, general and administrative expenses | 1,142 | 244,705 | 96,903 | 103,765 | (734 | ) | 445,781 | |||||||||||||||||
Research and development expenses | — | 20,222 | 26,676 | 6,788 | — | 53,686 | ||||||||||||||||||
Acquired intangible asset amortization | — | 81,085 | 59,273 | 31,902 | — | 172,260 | ||||||||||||||||||
Operating earnings (loss) | (1,198 | ) | (54,938 | ) | 20,899 | (7,445 | ) | 138,635 | 95,953 | |||||||||||||||
Non-operating intercompany transactions | — | 71,692 | 261,173 | (352,936 | ) | 20,071 | — | |||||||||||||||||
Interest income and other | — | 55,260 | 9,188 | 100 | (63,918 | ) | 630 | |||||||||||||||||
Interest expense | — | (362,215 | ) | (54,725 | ) | (85 | ) | 63,918 | (353,107 | ) | ||||||||||||||
Foreign currency gain (loss) | — | 2,470 | 318 | (2,360 | ) | — | 428 | |||||||||||||||||
Derivative instruments gain (loss) | — | (28,473 | ) | — | — | — | (28,473 | ) | ||||||||||||||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | (1,198 | ) | (316,204 | ) | 236,853 | (362,726 | ) | 158,706 | (284,569 | ) | ||||||||||||||
Income tax expense (benefit) | — | (61,959 | ) | (16,897 | ) | (28,269 | ) | — | (107,125 | ) | ||||||||||||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | (1,198 | ) | (254,245 | ) | 253,750 | (334,457 | ) | 158,706 | (177,444 | ) | ||||||||||||||
Equity in earnings (loss) of subsidiaries | (179,926 | ) | (73,757 | ) | (338,090 | ) | — | 591,773 | — | |||||||||||||||
Earnings (loss) from continuing operations | (181,124 | ) | (328,002 | ) | (84,340 | ) | (334,457 | ) | 750,479 | (177,444 | ) | |||||||||||||
Earnings (loss) from discontinued operations, net of tax | — | (8,761 | ) | 4,100 | (3,633 | ) | 4,614 | (3,680 | ) | |||||||||||||||
Net earnings (loss) | $ | (181,124 | ) | $ | (336,763 | ) | $ | (80,240 | ) | $ | (338,090 | ) | $ | 755,093 | $ | (181,124 | ) | |||||||
Total comprehensive income (loss) | $ | (182,711 | ) | $ | (338,350 | ) | $ | (81,827 | ) | $ | (339,677 | ) | $ | 759,854 | $ | (182,711 | ) | |||||||
Guarantor and Non-Guarantor Statement of Cash Flows | ' | |||||||||||||||||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Cash Flows | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the nine months ended September 30, 2013 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||||||
Net earnings (loss) | $ | (505,923 | ) | $ | (106,411 | ) | $ | (328,228 | ) | $ | (10,136 | ) | $ | 444,775 | $ | (505,923 | ) | |||||||
Adjustments to reconcile net earnings (loss) to net cash provided (used) by operating activities | 3,619 | 249,757 | 397,283 | 35,915 | (45,156 | ) | 641,418 | |||||||||||||||||
Net cash provided (used) by operating activities | (502,304 | ) | 143,346 | 69,055 | 25,779 | 399,619 | 135,495 | |||||||||||||||||
Cash flows from investing activities: | ||||||||||||||||||||||||
Net additions to property, plant and equipment | — | (145,714 | ) | (14,556 | ) | (98,591 | ) | 191,164 | (67,697 | ) | ||||||||||||||
Decrease (increase) in identifiable intangible assets and other non-current assets | — | (70 | ) | (4,474 | ) | 271 | — | (4,273 | ) | |||||||||||||||
Net cash provided (used) by investing activities | — | (145,784 | ) | (19,030 | ) | (98,320 | ) | 191,164 | (71,970 | ) | ||||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||||||
Distribution to limited partners | (1,572 | ) | — | — | — | — | (1,572 | ) | ||||||||||||||||
Repayments of long-term debt and capital lease obligations | — | (60,446 | ) | — | 17 | — | (60,429 | ) | ||||||||||||||||
Payment of debt issuance costs | — | (21,604 | ) | — | — | — | (21,604 | ) | ||||||||||||||||
Proceeds (payments) on intercompany loans | — | 51,298 | (53,452 | ) | 2,154 | — | — | |||||||||||||||||
Proceeds (payments) on intercompany investments | 503,876 | (104,808 | ) | 3,427 | 188,288 | (590,783 | ) | — | ||||||||||||||||
Net cash provided (used) by financing activities | 502,304 | (135,560 | ) | (50,025 | ) | 190,459 | (590,783 | ) | (83,605 | ) | ||||||||||||||
Effect of exchange rate changes on cash and cash equivalents | — | — | — | (151 | ) | — | (151 | ) | ||||||||||||||||
Net increase (decrease) in cash and cash equivalents | — | (137,998 | ) | — | 117,767 | — | (20,231 | ) | ||||||||||||||||
Cash and cash equivalents, beginning of period | 398 | 276,788 | — | 105,964 | — | 383,150 | ||||||||||||||||||
Cash and cash equivalents, end of period | $ | 398 | $ | 138,790 | $ | — | $ | 223,731 | $ | — | $ | 362,919 | ||||||||||||
Condensed Consolidating Parent Company, Co-Issuers, | ||||||||||||||||||||||||
Guarantor and Non-Guarantor Statement of Cash Flows | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
For the nine months ended September 30, 2012 | ||||||||||||||||||||||||
Centaur Guernsey L.P. Inc. Parent Company | Kinetic Concepts, Inc. and KCI USA, Inc. Borrower | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||||||
Net earnings (loss) | $ | (181,124 | ) | $ | (336,763 | ) | $ | (80,240 | ) | $ | (338,090 | ) | $ | 755,093 | $ | (181,124 | ) | |||||||
Adjustments to reconcile net loss to net cash provided (used) by operating activities | 3,154 | 439,770 | (123,522 | ) | 153,344 | (105,747 | ) | 366,999 | ||||||||||||||||
Net cash provided (used) by operating activities | (177,970 | ) | 103,007 | (203,762 | ) | (184,746 | ) | 649,346 | 185,875 | |||||||||||||||
Cash flows from investing activities: | ||||||||||||||||||||||||
Net additions to property, plant and equipment | — | (57,203 | ) | (42,323 | ) | (39,328 | ) | 69,344 | (69,510 | ) | ||||||||||||||
Decrease (increase) in identifiable intangible assets and other non-current assets | — | 87 | (5,486 | ) | 19 | — | (5,380 | ) | ||||||||||||||||
Net cash provided (used) by investing activities | — | (57,116 | ) | (47,809 | ) | (39,309 | ) | 69,344 | (74,890 | ) | ||||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||||||
Capital contributions from limited partners | 239 | — | — | — | — | 239 | ||||||||||||||||||
Distribution to limited partners | (1,970 | ) | — | — | — | — | (1,970 | ) | ||||||||||||||||
Repayments of long-term debt and capital lease obligations | — | (17,508 | ) | — | 25 | — | (17,483 | ) | ||||||||||||||||
Proceeds (payments) on intercompany loans | — | (120,557 | ) | 45,537 | 75,020 | — | — | |||||||||||||||||
Payment of debt issuance costs | — | (578 | ) | — | — | — | (578 | ) | ||||||||||||||||
Proceeds (payments) on intercompany investments | 179,688 | 196,745 | 206,034 | 136,223 | (718,690 | ) | — | |||||||||||||||||
Net cash provided (used) by financing activities | 177,957 | 58,102 | 251,571 | 211,268 | (718,690 | ) | (19,792 | ) | ||||||||||||||||
Effect of exchange rate changes on cash and cash equivalents | — | — | — | 308 | — | 308 | ||||||||||||||||||
Net increase (decrease) in cash and cash equivalents | (13 | ) | 103,993 | — | (12,479 | ) | — | 91,501 | ||||||||||||||||
Cash and cash equivalents, beginning of period | 411 | 142,652 | — | 72,363 | — | 215,426 | ||||||||||||||||||
Cash and cash equivalents, end of period | $ | 398 | $ | 246,645 | $ | — | $ | 59,884 | $ | — | $ | 306,927 | ||||||||||||
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Details) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended | 9 Months Ended | ||||
Nov. 08, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Oct. 31, 2012 | |
segment | segment | Interest Rate Swap [Member] | LifeCell Corporation [Member] | LifeCell Corporation [Member] | ||||
Concentration of Credit Risk [Member] | ||||||||
Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from Divestiture of Businesses | $241,500,000 | ' | ' | ' | ' | ' | ' | ' |
Basis of Presentation and Principles of Consolidation [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Number of reportable operating segments | ' | 2 | ' | 2 | ' | ' | ' | ' |
Number of global business units | ' | 2 | ' | 2 | ' | ' | ' | ' |
Number of primary geographic regions | ' | 2 | ' | 2 | ' | ' | ' | ' |
Concentration of Credit Risk [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Notional amount of interest rate swap and cap agreements | ' | ' | ' | ' | ' | 1,031,000,000 | ' | ' |
Fixed asset and inventory impairment | ' | ' | 9,700,000 | 30,259,000 | 22,116,000 | ' | ' | ' |
Potential Drop in Fair Value of Reporting Unit | ' | ' | ' | ' | ' | ' | ' | 6.00% |
Potential Drop in Fair Value of Identifiable Intangible Assets | ' | ' | ' | ' | ' | ' | ' | 4.00% |
Goodwill, Impairment Loss | ' | ' | ' | ' | ' | ' | 272,200,000 | ' |
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | ' | ' | ' | ' | ' | ' | 171,200,000 | ' |
Write-off of other intangible assets | ' | $3,500,000 | ' | $16,885,000 | $0 | ' | ' | ' |
Business_Acquisition_Details
Business Acquisition (Details) (Systagenix [Member], USD $) | 3 Months Ended | 12 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 | Jul. 30, 2013 |
Countries | employee | ||
Business Acquisition [Line Items] | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Purchase Price | ' | ' | $485 |
Number of Advanced Wound Dressings, Monthly | 20 | ' | ' |
Business Acquisition, number of countries in which entity operates | 70 | ' | ' |
Business Acquisition, Estimated Annual Revenue | ' | 200 | ' |
Business Acquisition, number of employees | ' | ' | 800 |
Senior Dollar Term D-1 Credit Facility Due 2018 [Member] | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' |
Business Acquisition, Incremental Borrowing | ' | ' | $350 |
Sale_of_Therapeutic_Support_Sy2
Sale of Therapeutic Support Systems Assets (Details) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended | ||
Nov. 08, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' |
Proceeds from Divestiture of Businesses | $241,500,000 | ' | ' | ' | ' |
Operating results of the TSS product portfolio included in discontinued operations | ' | ' | ' | ' | ' |
Revenue | ' | 0 | 52,673,000 | 0 | 168,107,000 |
Earnings (loss) before income tax expense (benefit) | ' | -415,000 | 3,304,000 | -3,738,000 | -5,984,000 |
Income tax expense (benefit) | ' | -160,000 | 1,272,000 | -1,439,000 | -2,304,000 |
Gain (loss) from discontinued operations, net of tax | ' | ($255,000) | $2,032,000 | ($2,299,000) | ($3,680,000) |
Supplemental_Balance_Sheet_Dat2
Supplemental Balance Sheet Data - Accounts Receivable, Net (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Billed trade accounts receivable | $382,538 | $370,708 |
Unbilled receivables | 49,350 | 45,466 |
Less: Allowance for revenue adjustments | -69,546 | -71,770 |
Gross trade accounts receivable | 362,342 | 344,404 |
Less: Allowance for bad debt | -7,017 | -4,768 |
Net trade accounts receivable | 355,325 | 339,636 |
Other receivables | 13,575 | 16,082 |
Accounts receivable, net | $368,900 | $355,718 |
Supplemental_Balance_Sheet_Dat3
Supplemental Balance Sheet Data - Inventories, Net (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Inventory [Line Items] | ' | ' |
Finished goods and tissue available for distribution | $100,873 | $96,573 |
Goods and tissue in-process | 9,325 | 12,421 |
Raw materials, supplies, parts and unprocessed tissue | 66,033 | 45,993 |
Inventories, gross | 176,231 | 154,987 |
Less: Amounts expected to be converted into equipment for short-term rental | -14,118 | -5,237 |
Reserve for excess and obsolete inventory | -12,127 | -9,900 |
Inventories, net | $149,986 | $139,850 |
LongTerm_Debt_Details
Long-Term Debt (Details) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | |||||||||||||||||||||||||||||
Mar. 15, 2013 | Feb. 04, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Nov. 30, 2011 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jul. 30, 2013 | Jul. 30, 2013 | |
Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Term Credit Facilities [Member] | Term Credit Facilities [Member] | Term Credit Facilities [Member] | Term Credit Facilities [Member] | Term Credit Facilities [Member] | Term Credit Facilities [Member] | Convertible Senior Notes [Member] | Convertible Senior Notes [Member] | Senior Secured Notes [Member] | Senior Secured Notes [Member] | Senior Unsecured Notes [Member] | Senior Unsecured Notes [Member] | IBM Financing [Member] | IBM Financing [Member] | Banks Which Are Not Party To Senior Secured Credit Facility [Member] | Banks Which Are Not Party To Senior Secured Credit Facility [Member] | Eurocurrency Rate [Member] | Eurocurrency Rate [Member] | Eurocurrency Rate [Member] | Eurocurrency Rate [Member] | Base Rate [Member] | Base Rate [Member] | Base Rate [Member] | Base Rate [Member] | Systagenix [Member] | Systagenix [Member] | ||||||
Senior Revolving Credit Facility - due 2016 [Member] | Senior Revolving Credit Facility - due 2016 [Member] | Senior Revolving Credit Facility - due 2016 [Member] | Senior Dollar Term D-1 Credit Facility Due 2018 [Member] | Senior Dollar Term D-1 Credit Facility Due 2018 [Member] | Senior Euro Term D-1 Credit Facility Due 2018 [Member] | Senior Euro Term D-1 Credit Facility Due 2018 [Member] | Senior Term D-2 Credit Facility Due 2016 [Member] | Senior Term D-2 Credit Facility Due 2016 [Member] | 3.25% Convertible Senior Notes due 2015 [Member] | 3.25% Convertible Senior Notes due 2015 [Member] | 10.5% Second Lien Senior Secured Notes due 2018 [Member] | 10.5% Second Lien Senior Secured Notes due 2018 [Member] | 12.5% Senior Unsecured Notes due 2019 [Member] | 12.5% Senior Unsecured Notes due 2019 [Member] | Senior Revolving Credit Facility - due 2016 [Member] | Senior Revolving Credit Facility - due 2016 [Member] | Senior Dollar Term D-1 Credit Facility Due 2018 [Member] | Senior Dollar Term D-1 Credit Facility Due 2018 [Member] | Senior Euro Term D-1 Credit Facility Due 2018 [Member] | Senior Term D-2 Credit Facility Due 2016 [Member] | Senior Dollar Term D-1 Credit Facility Due 2018 [Member] | Senior Dollar Term D-1 Credit Facility Due 2018 [Member] | Senior Euro Term D-1 Credit Facility Due 2018 [Member] | Senior Term D-2 Credit Facility Due 2016 [Member] | Senior Dollar Term D-1 Credit Facility Due 2018 [Member] | Term Credit Facilities [Member] | ||||||||
Minimum [Member] | Minimum [Member] | Senior Dollar Term D-1 Credit Facility Due 2018 [Member] | ||||||||||||||||||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term debt, gross | ' | ' | $4,617,504,000 | ' | $4,663,173,000 | ' | ' | ' | $1,601,607,000 | $1,613,700,000 | $332,186,000 | $327,022,000 | $319,339,000 | $321,750,000 | $101,000 | $701,000 | $1,750,000,000 | $1,750,000,000 | $612,000,000 | $650,000,000 | $2,271,000 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Less: Discount, net of accretion | ' | ' | -76,264,000 | ' | -85,678,000 | ' | ' | ' | -32,100,000 | -33,840,000 | -11,033,000 | -13,353,000 | -4,860,000 | -7,064,000 | ' | ' | -25,160,000 | -27,827,000 | -3,111,000 | -3,594,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 |
Long-term Debt | ' | ' | 4,541,240,000 | ' | 4,577,495,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Less: Current installments | ' | ' | -24,101,000 | ' | -23,383,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term debt, net of current installments and discount | ' | ' | 4,517,139,000 | ' | 4,554,112,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Senior Secured Credit Facilities [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit facility, maximum borrowing capacity | ' | ' | ' | ' | ' | ' | ' | 200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Amount Outstanding | ' | ' | ' | ' | ' | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Letters of credit, amount outstanding | ' | ' | ' | ' | ' | 10,700,000 | 11,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,500,000 | 4,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit facility, remaining borrowing capacity | ' | ' | ' | ' | ' | 189,300,000 | 188,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit facility, unused capacity, commitment fee percentage | ' | ' | ' | ' | ' | 0.38% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Incremental Borrowing | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 350,000,000 | ' |
Debt Instrument, Basis Spread on Variable Rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.50% | 1.00% | 3.75% | 3.00% | 2.50% | 2.00% | 2.75% | 2.00% | ' | ' |
10.5% Second Lien Senior Secured Notes and 12.5% Senior Unsecured Notes [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate on senior long-term debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.25% | ' | 10.50% | ' | 12.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instument, Registration Rights Agreement, Additional Interest Accrual Rate | 0.50% | 0.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repayments Of Long Term Debt Revolving Credit Facility And Capital Lease Obligations | ' | ' | $60,429,000 | $17,483,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $38,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative_Financial_Instrumen2
Derivative Financial Instruments and Fair Value Measurements - Derivative Financial Instruments (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Interest Rate Protection [Abstract] | ' | ' |
Collateral posted | $0 | ' |
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member] | ' | ' |
Interest Rate Protection [Abstract] | ' | ' |
Notional amount of nondesignated interest rate derivatives | 1,600,000,000 | 1,600,000,000 |
Cost of derivative | 2,200,000 | 2,200,000 |
Derivative, cap interest rate | 2.00% | 2.00% |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | ' | ' |
Interest Rate Protection [Abstract] | ' | ' |
Number of interest rate agreements held | 3 | 3 |
Derivative, quarterly interest payments, receive rates, maximum | 1.25% | ' |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Interest Rate Swap - 2.256%, effective December 31, 2013 [Member] | ' | ' |
Interest Rate Protection [Abstract] | ' | ' |
Notional amount of nondesignated interest rate derivatives | 512,633,000 | ' |
Fixed Interest Rate | 2.26% | ' |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Interest Rate Swap - 2.249%, effective December 31, 2013 [Member] | ' | ' |
Interest Rate Protection [Abstract] | ' | ' |
Notional amount of nondesignated interest rate derivatives | 512,633,000 | ' |
Fixed Interest Rate | 2.25% | ' |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Interest Rate Swap - 2.250%, effective December 31, 2013 [Member] | ' | ' |
Interest Rate Protection [Abstract] | ' | ' |
Notional amount of nondesignated interest rate derivatives | 512,633,000 | ' |
Fixed Interest Rate | 2.25% | ' |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Minimum [Member] | ' | ' |
Interest Rate Protection [Abstract] | ' | ' |
Notional amount decreases by quarter | 1,700,000 | ' |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Maximum [Member] | ' | ' |
Interest Rate Protection [Abstract] | ' | ' |
Notional amount decreases by quarter | 56,400,000 | ' |
Not Designated as Hedging Instrument [Member] | Foreign Currency Exchange Contracts [Member] | ' | ' |
Foreign Currency Exchange Risk Mitigation [Abstract] | ' | ' |
Notional amount of nondesignated foreign currency derivatives | 34,800,000 | 59,100,000 |
Senior Secured Credit Facility [Member] | ' | ' |
Derivative [Line Items] | ' | ' |
Long-term Debt, Fair Value | 2,300,000,000 | 2,300,000,000 |
Fixed Rate Long-Term Debt [Member] | ' | ' |
Derivative [Line Items] | ' | ' |
Long-term Debt, Fair Value | $2,600,000,000 | $2,400,000,000 |
Derivative_Financial_Instrumen3
Derivative Financial Instruments and Fair Value Measurements - Fair Value and Balance Sheet Locations (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative asset, fair value | $230 | $529 |
Derivative liability, fair value | 31,820 | 37,848 |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Other non-current assets [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative asset, fair value | 0 | 0 |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Prepaid expenses and other [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative asset, fair value | 0 | 0 |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Other non-current liabilities [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative liability, fair value | 30,482 | 34,868 |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Accrued expenses and other [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative liability, fair value | 330 | 0 |
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member] | Prepaid expenses and other [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative asset, fair value | 0 | 9 |
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member] | Accrued expenses and other [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative liability, fair value | 0 | 0 |
Not Designated as Hedging Instrument [Member] | Foreign Currency Exchange Contracts [Member] | Prepaid expenses and other [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative asset, fair value | 230 | 520 |
Not Designated as Hedging Instrument [Member] | Foreign Currency Exchange Contracts [Member] | Accrued expenses and other [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative liability, fair value | $1,008 | $2,980 |
Derivative_Financial_Instrumen4
Derivative Financial Instruments and Fair Value Measurements - Gain (Loss) on Derivatives (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Derivative instruments gain (loss) | ($6,840) | ($8,579) | $3,200 | ($28,473) |
Not Designated as Hedging Instrument [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Derivative instruments gain (loss) | -6,840 | -8,579 | 3,200 | -28,473 |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Derivative instruments gain (loss) | -5,195 | -6,313 | 4,057 | -24,610 |
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Derivative instruments gain (loss) | -4 | -118 | -9 | -1,563 |
Not Designated as Hedging Instrument [Member] | Foreign Currency Exchange Contracts [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Derivative instruments gain (loss) | ($1,641) | ($2,148) | ($848) | ($2,300) |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Income (Loss) (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Accumulated other comprehensive income (loss), net | ($7,526) | ' | ($7,526) | ' | ($517) |
Unrealized investment gain, net of tax expense of $1,413 | 541 | 0 | 2,257 | 0 | ' |
Foreign currency translation adjustment, net of tax benefit of $259 | -5,131 | 1,597 | -9,266 | -1,587 | ' |
Accumulated Net Unrealized Investment Gain (Loss) [Member] | ' | ' | ' | ' | ' |
Accumulated other comprehensive income (loss), net | 2,257 | ' | 2,257 | ' | 0 |
Foreign currency translation adjustment, net of tax benefit of $259 | ' | ' | 0 | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Member] | ' | ' | ' | ' | ' |
Accumulated other comprehensive income (loss), net | -7,526 | ' | -7,526 | ' | -517 |
Unrealized investment gain, net of tax expense of $1,413 | ' | ' | 2,257 | ' | ' |
Foreign currency translation adjustment, net of tax benefit of $259 | ' | ' | -9,266 | ' | ' |
Accumulated Translation Adjustment [Member] | ' | ' | ' | ' | ' |
Other Comprehensive Income (Loss), Reclassification Adjustment on Derivatives Included in Net Income, before Tax | ' | ' | 0 | ' | ' |
Accumulated other comprehensive income (loss), net | -9,783 | ' | -9,783 | ' | -517 |
Unrealized investment gain, net of tax expense of $1,413 | ' | ' | $0 | ' | ' |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | Aug. 01, 2013 | Dec. 31, 2010 | Sep. 30, 2013 | Feb. 28, 2009 | Sep. 30, 2013 | Sep. 30, 2013 |
Wake Forest Royalty Litigation [Member] | Wake Forest Royalty Litigation [Member] | Billing Practices [Member] | Alloderm [Member] | Repliform [Member] | ||
contractor | LifeCell Corporation [Member] | LifeCell Corporation [Member] | ||||
employee | Damages from Product Defects [Member] | Damages from Product Defects [Member] | ||||
suit | suit | |||||
Loss Contingencies [Line Items] | ' | ' | ' | ' | ' | ' |
Royalty Expense | ' | $86,000,000 | $0 | ' | ' | ' |
Demand for Arbitration, Requested Damages | $100,000,000 | ' | ' | ' | ' | ' |
Number of pending lawsuits | ' | ' | ' | ' | 330 | 80 |
Number of Regional Durable Medical Equipment Medicare Administrative Contractors Records Provided | ' | ' | ' | 4 | ' | ' |
Number of Former Employees That Filed Qui Tam Actions | ' | ' | ' | 2 | ' | ' |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |||||
segment | segment | |||||||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ||||
Number of reportable operating segments | 2 | ' | 2 | ' | ||||
Number of global business units | 2 | ' | 2 | ' | ||||
Total revenue | $440,561,000 | $435,873,000 | $1,289,124,000 | $1,306,521,000 | ||||
Operating earnings (loss) | -369,866,000 | 66,563,000 | -323,203,000 | 95,953,000 | ||||
Non-allocated costs: | ' | ' | ' | ' | ||||
General headquarter expense | -6,335,000 | [1] | -5,520,000 | [1] | -59,447,000 | [1] | -19,545,000 | [1] |
Equity-based compensation | -850,000 | -197,000 | -2,046,000 | -1,186,000 | ||||
Merger and restructuring-related expenses | -31,112,000 | [2] | -21,684,000 | [2] | -97,518,000 | [2] | -63,750,000 | [2] |
Acquired intangible asset amortization | -45,099,000 | [3] | -49,733,000 | [3] | -138,969,000 | [3] | -172,260,000 | [3] |
Impairment of goodwill and intangible assets | -443,400,000 | [4] | 0 | [4] | -443,400,000 | [4] | 0 | [4] |
Total non-allocated costs | -526,796,000 | -77,134,000 | -741,380,000 | -256,741,000 | ||||
Write-off of other intangible assets | 3,500,000 | ' | 16,885,000 | 0 | ||||
Fixed asset and inventory impairment | ' | 9,700,000 | 30,259,000 | 22,116,000 | ||||
KCI [Member] | ' | ' | ' | ' | ||||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ||||
Total revenue | 320,879,000 | 329,651,000 | 944,526,000 | 986,157,000 | ||||
Operating earnings (loss) | 126,837,000 | 114,833,000 | 327,018,000 | 277,191,000 | ||||
LifeCell Corporation [Member] | ' | ' | ' | ' | ||||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ||||
Total revenue | 119,682,000 | 106,222,000 | 344,598,000 | 320,364,000 | ||||
Operating earnings (loss) | 30,093,000 | 28,864,000 | 91,159,000 | 75,503,000 | ||||
Non-allocated costs: | ' | ' | ' | ' | ||||
Goodwill, Impairment Loss | ' | ' | 272,200,000 | ' | ||||
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | ' | ' | $171,200,000 | ' | ||||
Minimum [Member] | ' | ' | ' | ' | ||||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ||||
Minimum number of countries in which the entity has operations | 25 | ' | 25 | ' | ||||
[1] | The third quarter and nine months ended September 30, 2013 includes write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets due primarily to the discontinuation of certain projects. The nine months ended September 30, 2013 also includes a $30.3 million fixed asset impairment charge. The third quarter and nine months ended September 30, 2012 includes $9.7 million and $22.1 million, respectively, of impairment charges associated with certain production equipment at our AHS manufacturing plant and inventory associated with our V.A.C. Via product. | |||||||
[2] | Represents expenses related to the Merger including buyer and seller transaction costs, management fees and restructuring-related expenses. | |||||||
[3] | Includes amortization of acquired intangible assets related to our Merger in November 2011. | |||||||
[4] | During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit. |
Guarantor_Condensed_Consolidat2
Guarantor Condensed Consolidating Financial Statements - Condensed Consolidated Balance Sheet (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | $362,919 | $383,150 | $306,927 | $215,426 |
Accounts receivable, net | 368,900 | 355,718 | ' | ' |
Inventories, net | 149,986 | 139,850 | ' | ' |
Deferred Tax Assets, Net of Valuation Allowance, Current | ' | 0 | ' | ' |
Prepaid expenses and other | 59,499 | 39,511 | ' | ' |
Intercompany receivables | 0 | 0 | ' | ' |
Total current assets | 941,304 | 918,229 | ' | ' |
Net property, plant and equipment | 312,555 | 388,482 | ' | ' |
Debt issuance costs, net | 101,766 | 96,476 | ' | ' |
Deferred income taxes | 21,866 | 20,003 | ' | ' |
Goodwill | 3,207,575 | 3,479,775 | ' | ' |
Identifiable intangible assets, net | 2,343,525 | 2,666,201 | ' | ' |
Other non-current assets | 4,054 | 5,598 | ' | ' |
Intercompany loan receivables | 0 | 0 | ' | ' |
Intercompany investments | 0 | 0 | ' | ' |
Total assets | 6,932,645 | 7,574,764 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | 44,527 | 40,970 | ' | ' |
Accrued expenses and other | 351,903 | 284,163 | ' | ' |
Intercompany payables | 0 | 0 | ' | ' |
Current installments of long-term debt | 24,101 | 23,383 | ' | ' |
Income taxes payable | 0 | 0 | ' | ' |
Deferred income taxes | 4,610 | 57,528 | ' | ' |
Total current liabilities | 425,141 | 406,044 | ' | ' |
Long-term debt, net of current installments and discount | 4,517,139 | 4,554,112 | ' | ' |
Non-current tax liabilities | 46,461 | 44,465 | ' | ' |
Deferred income taxes | 960,219 | 1,069,480 | ' | ' |
Other non-current liabilities | 38,897 | 43,267 | ' | ' |
Intercompany loan payables | 0 | 0 | ' | ' |
Total liabilities | 5,987,857 | 6,117,368 | ' | ' |
Equity: | ' | ' | ' | ' |
Total equity | 944,788 | 1,457,396 | ' | ' |
Total liabilities and shareholders' equity | 6,932,645 | 7,574,764 | ' | ' |
Parent Company [Member] | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 398 | 398 | 398 | 411 |
Accounts receivable, net | 0 | 0 | ' | ' |
Inventories, net | 0 | 0 | ' | ' |
Deferred Tax Assets, Net of Valuation Allowance, Current | ' | 0 | ' | ' |
Prepaid expenses and other | 0 | 0 | ' | ' |
Intercompany receivables | 166 | 166 | ' | ' |
Total current assets | 564 | 564 | ' | ' |
Net property, plant and equipment | 0 | 0 | ' | ' |
Debt issuance costs, net | 0 | 0 | ' | ' |
Deferred income taxes | 0 | 0 | ' | ' |
Goodwill | 0 | 0 | ' | ' |
Identifiable intangible assets, net | 0 | 0 | ' | ' |
Other non-current assets | 0 | 0 | ' | ' |
Intercompany loan receivables | 0 | 0 | ' | ' |
Intercompany investments | 948,376 | 1,459,261 | ' | ' |
Total assets | 948,940 | 1,459,825 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | 0 | 0 | ' | ' |
Accrued expenses and other | 0 | 0 | ' | ' |
Intercompany payables | 3,934 | 2,361 | ' | ' |
Current installments of long-term debt | 0 | 0 | ' | ' |
Income taxes payable | 0 | 0 | ' | ' |
Deferred income taxes | 0 | 0 | ' | ' |
Total current liabilities | 3,934 | 2,361 | ' | ' |
Long-term debt, net of current installments and discount | 0 | 0 | ' | ' |
Non-current tax liabilities | 0 | 0 | ' | ' |
Deferred income taxes | 0 | 0 | ' | ' |
Other non-current liabilities | 218 | 68 | ' | ' |
Intercompany loan payables | 0 | 0 | ' | ' |
Total liabilities | 4,152 | 2,429 | ' | ' |
Equity: | ' | ' | ' | ' |
Total equity | 944,788 | 1,457,396 | ' | ' |
Total liabilities and shareholders' equity | 948,940 | 1,459,825 | ' | ' |
Kinetic Concepts, Inc. and KCI USA, Inc. Borrower [Member] | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 138,790 | 276,788 | 246,645 | 142,652 |
Accounts receivable, net | 184,370 | 174,534 | ' | ' |
Inventories, net | 63,219 | 94,345 | ' | ' |
Deferred Tax Assets, Net of Valuation Allowance, Current | ' | 38,451 | ' | ' |
Prepaid expenses and other | 41,376 | 25,083 | ' | ' |
Intercompany receivables | 1,400,317 | 1,337,915 | ' | ' |
Total current assets | 1,828,072 | 1,947,116 | ' | ' |
Net property, plant and equipment | 297,648 | 281,950 | ' | ' |
Debt issuance costs, net | 101,766 | 96,476 | ' | ' |
Deferred income taxes | 0 | 0 | ' | ' |
Goodwill | 2,483,240 | 2,483,240 | ' | ' |
Identifiable intangible assets, net | 380,314 | 441,620 | ' | ' |
Other non-current assets | 424 | 324 | ' | ' |
Intercompany loan receivables | 785,000 | 800,000 | ' | ' |
Intercompany investments | 406,067 | 302,027 | ' | ' |
Total assets | 6,282,531 | 6,352,753 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | 16,089 | 17,869 | ' | ' |
Accrued expenses and other | 234,359 | 172,356 | ' | ' |
Intercompany payables | 788,613 | 723,096 | ' | ' |
Current installments of long-term debt | 22,760 | 23,383 | ' | ' |
Income taxes payable | 1,495 | -1,452 | ' | ' |
Deferred income taxes | -34,267 | 0 | ' | ' |
Total current liabilities | 1,029,049 | 935,252 | ' | ' |
Long-term debt, net of current installments and discount | 4,516,223 | 4,554,112 | ' | ' |
Non-current tax liabilities | 42,084 | 36,711 | ' | ' |
Deferred income taxes | 56,892 | 115,652 | ' | ' |
Other non-current liabilities | 37,242 | 41,360 | ' | ' |
Intercompany loan payables | 402,433 | 366,135 | ' | ' |
Total liabilities | 6,083,923 | 6,049,222 | ' | ' |
Equity: | ' | ' | ' | ' |
Total equity | 198,608 | 303,531 | ' | ' |
Total liabilities and shareholders' equity | 6,282,531 | 6,352,753 | ' | ' |
Guarantor Subsidiaries [Member] | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 73,382 | 58,244 | ' | ' |
Inventories, net | 92,060 | 71,676 | ' | ' |
Deferred Tax Assets, Net of Valuation Allowance, Current | ' | 0 | ' | ' |
Prepaid expenses and other | 5,913 | 6,591 | ' | ' |
Intercompany receivables | 2,270,890 | 2,149,981 | ' | ' |
Total current assets | 2,442,245 | 2,286,492 | ' | ' |
Net property, plant and equipment | 82,391 | 79,049 | ' | ' |
Debt issuance costs, net | 0 | 0 | ' | ' |
Deferred income taxes | 0 | 0 | ' | ' |
Goodwill | 724,335 | 996,535 | ' | ' |
Identifiable intangible assets, net | 1,809,207 | 2,045,091 | ' | ' |
Other non-current assets | 186 | 186 | ' | ' |
Intercompany loan receivables | 404,586 | 366,134 | ' | ' |
Intercompany investments | 406,253 | 409,702 | ' | ' |
Total assets | 5,869,203 | 6,183,189 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | 12,540 | 13,093 | ' | ' |
Accrued expenses and other | 238,528 | 236,838 | ' | ' |
Intercompany payables | 2,508,621 | 2,389,863 | ' | ' |
Current installments of long-term debt | 1,341 | 0 | ' | ' |
Income taxes payable | 0 | 0 | ' | ' |
Deferred income taxes | 42,519 | 99,621 | ' | ' |
Total current liabilities | 2,803,549 | 2,739,415 | ' | ' |
Long-term debt, net of current installments and discount | 916 | 0 | ' | ' |
Non-current tax liabilities | 0 | 0 | ' | ' |
Deferred income taxes | 852,886 | 888,597 | ' | ' |
Other non-current liabilities | 298 | 375 | ' | ' |
Intercompany loan payables | 785,000 | 800,000 | ' | ' |
Total liabilities | 4,442,649 | 4,428,387 | ' | ' |
Equity: | ' | ' | ' | ' |
Total equity | 1,426,554 | 1,754,802 | ' | ' |
Total liabilities and shareholders' equity | 5,869,203 | 6,183,189 | ' | ' |
Non-Guarantor Subsidiaries [Member] | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 223,731 | 105,964 | 59,884 | 72,363 |
Accounts receivable, net | 111,148 | 122,940 | ' | ' |
Inventories, net | 78,178 | 60,635 | ' | ' |
Deferred Tax Assets, Net of Valuation Allowance, Current | ' | 3,642 | ' | ' |
Prepaid expenses and other | 342,209 | 294,437 | ' | ' |
Intercompany receivables | 149,321 | 147,473 | ' | ' |
Total current assets | 904,587 | 735,091 | ' | ' |
Net property, plant and equipment | 197,071 | 190,419 | ' | ' |
Debt issuance costs, net | 0 | 0 | ' | ' |
Deferred income taxes | 21,866 | 20,003 | ' | ' |
Goodwill | 0 | 0 | ' | ' |
Identifiable intangible assets, net | 154,004 | 179,490 | ' | ' |
Other non-current assets | 94,344 | 95,988 | ' | ' |
Intercompany loan receivables | 0 | 0 | ' | ' |
Intercompany investments | 0 | 0 | ' | ' |
Total assets | 1,371,872 | 1,220,991 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | 15,898 | 10,008 | ' | ' |
Accrued expenses and other | 61,948 | 62,226 | ' | ' |
Intercompany payables | 519,526 | 520,215 | ' | ' |
Current installments of long-term debt | 0 | 0 | ' | ' |
Income taxes payable | -1,495 | 1,452 | ' | ' |
Deferred income taxes | -3,642 | 0 | ' | ' |
Total current liabilities | 592,235 | 593,901 | ' | ' |
Long-term debt, net of current installments and discount | 0 | 0 | ' | ' |
Non-current tax liabilities | 4,377 | 7,754 | ' | ' |
Deferred income taxes | 50,441 | 65,231 | ' | ' |
Other non-current liabilities | 1,139 | 1,464 | ' | ' |
Intercompany loan payables | 2,153 | 0 | ' | ' |
Total liabilities | 650,345 | 668,350 | ' | ' |
Equity: | ' | ' | ' | ' |
Total equity | 721,527 | 552,641 | ' | ' |
Total liabilities and shareholders' equity | 1,371,872 | 1,220,991 | ' | ' |
Eliminations [Member] | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | ' | ' |
Inventories, net | -83,471 | -86,806 | ' | ' |
Deferred Tax Assets, Net of Valuation Allowance, Current | ' | -42,093 | ' | ' |
Prepaid expenses and other | -329,999 | -286,600 | ' | ' |
Intercompany receivables | -3,820,694 | -3,635,535 | ' | ' |
Total current assets | -4,234,164 | -4,051,034 | ' | ' |
Net property, plant and equipment | -264,555 | -162,936 | ' | ' |
Debt issuance costs, net | 0 | 0 | ' | ' |
Deferred income taxes | 0 | 0 | ' | ' |
Goodwill | 0 | 0 | ' | ' |
Identifiable intangible assets, net | 0 | 0 | ' | ' |
Other non-current assets | -90,900 | -90,900 | ' | ' |
Intercompany loan receivables | -1,189,586 | -1,166,134 | ' | ' |
Intercompany investments | -1,760,696 | -2,170,990 | ' | ' |
Total assets | -7,539,901 | -7,641,994 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | 0 | 0 | ' | ' |
Accrued expenses and other | -182,932 | -187,257 | ' | ' |
Intercompany payables | -3,820,694 | -3,635,535 | ' | ' |
Current installments of long-term debt | 0 | 0 | ' | ' |
Income taxes payable | 0 | 0 | ' | ' |
Deferred income taxes | 0 | -42,093 | ' | ' |
Total current liabilities | -4,003,626 | -3,864,885 | ' | ' |
Long-term debt, net of current installments and discount | 0 | 0 | ' | ' |
Non-current tax liabilities | 0 | 0 | ' | ' |
Deferred income taxes | 0 | 0 | ' | ' |
Other non-current liabilities | 0 | 0 | ' | ' |
Intercompany loan payables | -1,189,586 | -1,166,135 | ' | ' |
Total liabilities | -5,193,212 | -5,031,020 | ' | ' |
Equity: | ' | ' | ' | ' |
Total equity | -2,346,689 | -2,610,974 | ' | ' |
Total liabilities and shareholders' equity | ($7,539,901) | ($7,641,994) | ' | ' |
Guarantor_Condensed_Consolidat3
Guarantor Condensed Consolidating Financial Statements - Condensed Consolidated Statement of Operations and Comprehensive Income (Loss) (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||||
Condensed Income Statements, Captions [Line Items] | ' | ' | ' | ' | ||||
Rental | $191,041 | $207,156 | $569,449 | $622,350 | ||||
Sales | 249,520 | 228,717 | 719,675 | 684,171 | ||||
Total revenue | 440,561 | 435,873 | 1,289,124 | 1,306,521 | ||||
Rental expenses | 85,746 | 100,810 | 273,479 | 348,387 | ||||
Cost of sales | 66,151 | 58,613 | 181,707 | 190,454 | ||||
Gross profit (loss) | 288,664 | 276,450 | 833,938 | 767,680 | ||||
Selling, general and administrative expenses | 152,053 | 142,778 | 518,478 | 445,781 | ||||
Research and development expenses | 17,961 | 17,376 | 56,140 | 53,686 | ||||
Acquired intangible asset amortization | 45,116 | 49,733 | 139,123 | 172,260 | ||||
Impairment of goodwill and intangible assets | 443,400 | [1] | 0 | [1] | 443,400 | [1] | 0 | [1] |
Operating earnings (loss) | -369,866 | 66,563 | -323,203 | 95,953 | ||||
Non-operating intercompany transactions | 0 | 0 | 0 | 0 | ||||
Interest income and other | 217 | 174 | 1,279 | 630 | ||||
Interest expense | -101,398 | -117,920 | -315,144 | -353,107 | ||||
Loss on extinguishment of debt | -200 | 0 | -2,364 | 0 | ||||
Foreign currency gain (loss) | -8,738 | -5,258 | -11,935 | 428 | ||||
Derivative instruments loss | -6,840 | -8,579 | 3,200 | -28,473 | ||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | -486,825 | -65,020 | -648,167 | -284,569 | ||||
Income tax expense (benefit) | -88,519 | -27,176 | -144,543 | -107,125 | ||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | -398,306 | -37,844 | -503,624 | -177,444 | ||||
Equity in earnings (loss) of subsidiaries | 0 | 0 | 0 | 0 | ||||
Earnings (loss) from continuing operations | -398,306 | -37,844 | -503,624 | -177,444 | ||||
Earnings (loss) from discontinued operations, net of tax | -255 | 2,032 | -2,299 | -3,680 | ||||
Net earnings (loss) | -398,561 | -35,812 | -505,923 | -181,124 | ||||
Total comprehensive income (loss) | -403,151 | -34,215 | -512,932 | -182,711 | ||||
Parent Company [Member] | ' | ' | ' | ' | ||||
Condensed Income Statements, Captions [Line Items] | ' | ' | ' | ' | ||||
Rental | 0 | 0 | 0 | 0 | ||||
Sales | 0 | 0 | 0 | 0 | ||||
Total revenue | 0 | 0 | 0 | 0 | ||||
Rental expenses | 0 | 0 | 13 | 2 | ||||
Cost of sales | 30 | 18 | 84 | 54 | ||||
Gross profit (loss) | -30 | -18 | -97 | -56 | ||||
Selling, general and administrative expenses | 820 | 191 | 1,949 | 1,142 | ||||
Research and development expenses | 0 | 0 | 0 | 0 | ||||
Acquired intangible asset amortization | 0 | 0 | 0 | 0 | ||||
Impairment of goodwill and intangible assets | 0 | ' | 0 | ' | ||||
Operating earnings (loss) | -850 | -209 | -2,046 | -1,198 | ||||
Non-operating intercompany transactions | 0 | 0 | 0 | 0 | ||||
Interest income and other | 0 | 0 | 0 | 0 | ||||
Interest expense | 0 | 0 | 0 | 0 | ||||
Loss on extinguishment of debt | 0 | ' | 0 | ' | ||||
Foreign currency gain (loss) | 0 | 0 | 0 | 0 | ||||
Derivative instruments loss | 0 | 0 | 0 | 0 | ||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | -850 | -209 | -2,046 | -1,198 | ||||
Income tax expense (benefit) | 0 | 0 | 0 | 0 | ||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | -850 | -209 | -2,046 | -1,198 | ||||
Equity in earnings (loss) of subsidiaries | -397,711 | -35,603 | -503,877 | -179,926 | ||||
Earnings (loss) from continuing operations | -398,561 | -35,812 | -505,923 | -181,124 | ||||
Earnings (loss) from discontinued operations, net of tax | 0 | 0 | 0 | 0 | ||||
Net earnings (loss) | -398,561 | -35,812 | -505,923 | -181,124 | ||||
Total comprehensive income (loss) | -403,151 | -34,215 | -512,932 | -182,711 | ||||
Kinetic Concepts, Inc. and KCI USA, Inc. Borrower [Member] | ' | ' | ' | ' | ||||
Condensed Income Statements, Captions [Line Items] | ' | ' | ' | ' | ||||
Rental | 155,893 | 164,641 | 461,605 | 495,299 | ||||
Sales | 77,659 | 74,943 | 221,296 | 218,950 | ||||
Total revenue | 233,552 | 239,584 | 682,901 | 714,249 | ||||
Rental expenses | 62,928 | 62,877 | 186,426 | 227,119 | ||||
Cost of sales | 123,481 | 89,027 | 221,212 | 196,056 | ||||
Gross profit (loss) | 47,143 | 87,680 | 275,263 | 291,074 | ||||
Selling, general and administrative expenses | 66,834 | 75,731 | 269,490 | 244,705 | ||||
Research and development expenses | 8,010 | 6,268 | 23,366 | 20,222 | ||||
Acquired intangible asset amortization | 19,625 | 22,308 | 61,276 | 81,085 | ||||
Impairment of goodwill and intangible assets | 0 | ' | 0 | ' | ||||
Operating earnings (loss) | -47,326 | -16,627 | -78,869 | -54,938 | ||||
Non-operating intercompany transactions | -8,076 | 5,318 | 52,176 | 71,692 | ||||
Interest income and other | 17,852 | 18,532 | 54,046 | 55,260 | ||||
Interest expense | -104,402 | -120,964 | -324,163 | -362,215 | ||||
Loss on extinguishment of debt | -200 | ' | -2,364 | ' | ||||
Foreign currency gain (loss) | -14,433 | -6,651 | -8,953 | 2,470 | ||||
Derivative instruments loss | -6,840 | -8,579 | 3,200 | -28,473 | ||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | -163,425 | -128,971 | -304,927 | -316,204 | ||||
Income tax expense (benefit) | -51,104 | -22,700 | -97,201 | -61,959 | ||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | -112,321 | -106,271 | -207,726 | -254,245 | ||||
Equity in earnings (loss) of subsidiaries | 48,780 | 28,741 | 104,040 | -73,757 | ||||
Earnings (loss) from continuing operations | -63,541 | -77,530 | -103,686 | -328,002 | ||||
Earnings (loss) from discontinued operations, net of tax | -331 | -1,468 | -2,725 | -8,761 | ||||
Net earnings (loss) | -63,872 | -78,998 | -106,411 | -336,763 | ||||
Total comprehensive income (loss) | -68,462 | -77,401 | -113,420 | -338,350 | ||||
Guarantor Subsidiaries [Member] | ' | ' | ' | ' | ||||
Condensed Income Statements, Captions [Line Items] | ' | ' | ' | ' | ||||
Rental | 1,513 | 1,741 | 4,766 | 4,507 | ||||
Sales | 224,426 | 103,716 | 640,681 | 312,106 | ||||
Total revenue | 225,939 | 105,457 | 645,447 | 316,613 | ||||
Rental expenses | 4,010 | 1,526 | 12,180 | 4,088 | ||||
Cost of sales | 142,946 | 34,023 | 396,855 | 108,774 | ||||
Gross profit (loss) | 78,983 | 69,908 | 236,412 | 203,751 | ||||
Selling, general and administrative expenses | 44,169 | 32,926 | 136,734 | 96,903 | ||||
Research and development expenses | 6,742 | 8,977 | 23,263 | 26,676 | ||||
Acquired intangible asset amortization | 17,907 | 18,687 | 54,274 | 59,273 | ||||
Impairment of goodwill and intangible assets | 443,400 | ' | 443,400 | ' | ||||
Operating earnings (loss) | -433,235 | 9,318 | -421,259 | 20,899 | ||||
Non-operating intercompany transactions | 49,735 | 132,861 | 108,489 | 261,173 | ||||
Interest income and other | 3,062 | 3,063 | 9,188 | 9,188 | ||||
Interest expense | -17,756 | -18,375 | -52,974 | -54,725 | ||||
Loss on extinguishment of debt | 0 | ' | 0 | ' | ||||
Foreign currency gain (loss) | -38 | 170 | -251 | 318 | ||||
Derivative instruments loss | 0 | 0 | 0 | 0 | ||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | -398,232 | 127,037 | -356,807 | 236,853 | ||||
Income tax expense (benefit) | -34,535 | 14,055 | -38,718 | -16,897 | ||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | -363,697 | 112,982 | -318,089 | 253,750 | ||||
Equity in earnings (loss) of subsidiaries | -20,950 | -83,578 | -10,136 | -338,090 | ||||
Earnings (loss) from continuing operations | -384,647 | 29,404 | -328,225 | -84,340 | ||||
Earnings (loss) from discontinued operations, net of tax | -1 | 627 | -3 | 4,100 | ||||
Net earnings (loss) | -384,648 | 30,031 | -328,228 | -80,240 | ||||
Total comprehensive income (loss) | -389,238 | 31,628 | -335,237 | -81,827 | ||||
Non-Guarantor Subsidiaries [Member] | ' | ' | ' | ' | ||||
Condensed Income Statements, Captions [Line Items] | ' | ' | ' | ' | ||||
Rental | 33,635 | 40,774 | 103,078 | 122,544 | ||||
Sales | 159,142 | 151,225 | 481,490 | 388,453 | ||||
Total revenue | 192,777 | 191,999 | 584,568 | 510,997 | ||||
Rental expenses | 53,891 | 61,744 | 167,226 | 201,240 | ||||
Cost of sales | 57,512 | 58,201 | 177,420 | 174,747 | ||||
Gross profit (loss) | 81,374 | 72,054 | 239,922 | 135,010 | ||||
Selling, general and administrative expenses | 40,261 | 33,978 | 110,515 | 103,765 | ||||
Research and development expenses | 3,209 | 2,131 | 9,511 | 6,788 | ||||
Acquired intangible asset amortization | 7,584 | 8,738 | 23,573 | 31,902 | ||||
Impairment of goodwill and intangible assets | 0 | ' | 0 | ' | ||||
Operating earnings (loss) | 30,320 | 27,207 | 96,323 | -7,445 | ||||
Non-operating intercompany transactions | -60,212 | -131,367 | -112,565 | -352,936 | ||||
Interest income and other | 97 | 18 | 166 | 100 | ||||
Interest expense | -34 | -20 | -128 | -85 | ||||
Loss on extinguishment of debt | 0 | ' | 0 | ' | ||||
Foreign currency gain (loss) | 5,733 | 1,223 | -2,731 | -2,360 | ||||
Derivative instruments loss | 0 | 0 | 0 | 0 | ||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | -24,096 | -102,939 | -18,935 | -362,726 | ||||
Income tax expense (benefit) | -2,880 | -18,531 | -8,624 | -28,269 | ||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | -21,216 | -84,408 | -10,311 | -334,457 | ||||
Equity in earnings (loss) of subsidiaries | 0 | 0 | 0 | 0 | ||||
Earnings (loss) from continuing operations | -21,216 | -84,408 | -10,311 | -334,457 | ||||
Earnings (loss) from discontinued operations, net of tax | 266 | 830 | 175 | -3,633 | ||||
Net earnings (loss) | -20,950 | -83,578 | -10,136 | -338,090 | ||||
Total comprehensive income (loss) | -25,540 | -81,981 | -17,145 | -339,677 | ||||
Eliminations [Member] | ' | ' | ' | ' | ||||
Condensed Income Statements, Captions [Line Items] | ' | ' | ' | ' | ||||
Rental | 0 | 0 | 0 | 0 | ||||
Sales | -211,707 | -101,167 | -623,792 | -235,338 | ||||
Total revenue | -211,707 | -101,167 | -623,792 | -235,338 | ||||
Rental expenses | -35,083 | -25,337 | -92,366 | -84,062 | ||||
Cost of sales | -257,818 | -122,656 | -613,864 | -289,177 | ||||
Gross profit (loss) | 81,194 | 46,826 | 82,438 | 137,901 | ||||
Selling, general and administrative expenses | -31 | -48 | -210 | -734 | ||||
Research and development expenses | 0 | 0 | 0 | 0 | ||||
Acquired intangible asset amortization | 0 | 0 | 0 | 0 | ||||
Impairment of goodwill and intangible assets | 0 | ' | 0 | ' | ||||
Operating earnings (loss) | 81,225 | 46,874 | 82,648 | 138,635 | ||||
Non-operating intercompany transactions | 18,553 | -6,812 | -48,100 | 20,071 | ||||
Interest income and other | -20,794 | -21,439 | -62,121 | -63,918 | ||||
Interest expense | 20,794 | 21,439 | 62,121 | 63,918 | ||||
Loss on extinguishment of debt | 0 | ' | 0 | ' | ||||
Foreign currency gain (loss) | 0 | 0 | 0 | 0 | ||||
Derivative instruments loss | 0 | 0 | 0 | 0 | ||||
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries | 99,778 | 40,062 | 34,548 | 158,706 | ||||
Income tax expense (benefit) | 0 | 0 | 0 | 0 | ||||
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries | 99,778 | 40,062 | 34,548 | 158,706 | ||||
Equity in earnings (loss) of subsidiaries | 369,881 | 90,440 | 409,973 | 591,773 | ||||
Earnings (loss) from continuing operations | 469,659 | 130,502 | 444,521 | 750,479 | ||||
Earnings (loss) from discontinued operations, net of tax | -189 | 2,043 | 254 | 4,614 | ||||
Net earnings (loss) | 469,470 | 132,545 | 444,775 | 755,093 | ||||
Total comprehensive income (loss) | $483,240 | $127,754 | $465,802 | $759,854 | ||||
[1] | During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit. |
Guarantor_Condensed_Consolidat4
Guarantor Condensed Consolidating Financial Statements - Condensed Consolidated Cash Flow (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities: | ' | ' |
Net loss | ($505,923) | ($181,124) |
Adjustments to reconcile net earnings (loss) to net cash provided | 641,418 | 366,999 |
Net cash provided (used) by operating activities | 135,495 | 185,875 |
Cash flows from investing activities | ' | ' |
Net additions to property, plant and equipment | -67,697 | -69,510 |
Increase in identifiable intangible assets and other non-current assets | -4,273 | -5,380 |
Net cash provided (used) by investing activities | -71,970 | -74,890 |
Cash flows from financing activities: | ' | ' |
Capital contributions from limited partners | 0 | 239 |
Distribution to limited partners | -1,572 | -1,970 |
Repayments of long-term debt and capital lease obligations | -60,429 | -17,483 |
Payment of debt issuance costs | -21,604 | -578 |
Proceeds (payments) on intercompany loans | 0 | 0 |
Proceeds (payments) on intercompany investments | 0 | 0 |
Net cash provided (used) by financing activities | -83,605 | -19,792 |
Effect of exchange rate changes on cash and cash equivalents | -151 | 308 |
Net increase (decrease) in cash and cash equivalents | -20,231 | 91,501 |
Cash and cash equivalents, beginning of period | 383,150 | 215,426 |
Cash and cash equivalents, end of period | 362,919 | 306,927 |
Parent Company [Member] | ' | ' |
Cash flows from operating activities: | ' | ' |
Net loss | -505,923 | -181,124 |
Adjustments to reconcile net earnings (loss) to net cash provided | 3,619 | 3,154 |
Net cash provided (used) by operating activities | -502,304 | -177,970 |
Cash flows from investing activities | ' | ' |
Net additions to property, plant and equipment | 0 | 0 |
Increase in identifiable intangible assets and other non-current assets | 0 | 0 |
Net cash provided (used) by investing activities | 0 | 0 |
Cash flows from financing activities: | ' | ' |
Capital contributions from limited partners | ' | 239 |
Distribution to limited partners | -1,572 | -1,970 |
Repayments of long-term debt and capital lease obligations | 0 | 0 |
Payment of debt issuance costs | 0 | 0 |
Proceeds (payments) on intercompany loans | 0 | 0 |
Proceeds (payments) on intercompany investments | 503,876 | 179,688 |
Net cash provided (used) by financing activities | 502,304 | 177,957 |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash and cash equivalents | 0 | -13 |
Cash and cash equivalents, beginning of period | 398 | 411 |
Cash and cash equivalents, end of period | 398 | 398 |
Kinetic Concepts, Inc. and KCI USA, Inc. Borrower [Member] | ' | ' |
Cash flows from operating activities: | ' | ' |
Net loss | -106,411 | -336,763 |
Adjustments to reconcile net earnings (loss) to net cash provided | 249,757 | 439,770 |
Net cash provided (used) by operating activities | 143,346 | 103,007 |
Cash flows from investing activities | ' | ' |
Net additions to property, plant and equipment | -145,714 | -57,203 |
Increase in identifiable intangible assets and other non-current assets | -70 | 87 |
Net cash provided (used) by investing activities | -145,784 | -57,116 |
Cash flows from financing activities: | ' | ' |
Capital contributions from limited partners | ' | 0 |
Distribution to limited partners | 0 | 0 |
Repayments of long-term debt and capital lease obligations | -60,446 | -17,508 |
Payment of debt issuance costs | -21,604 | -578 |
Proceeds (payments) on intercompany loans | 51,298 | -120,557 |
Proceeds (payments) on intercompany investments | -104,808 | 196,745 |
Net cash provided (used) by financing activities | -135,560 | 58,102 |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash and cash equivalents | -137,998 | 103,993 |
Cash and cash equivalents, beginning of period | 276,788 | 142,652 |
Cash and cash equivalents, end of period | 138,790 | 246,645 |
Guarantor Subsidiaries [Member] | ' | ' |
Cash flows from operating activities: | ' | ' |
Net loss | -328,228 | -80,240 |
Adjustments to reconcile net earnings (loss) to net cash provided | 397,283 | -123,522 |
Net cash provided (used) by operating activities | 69,055 | -203,762 |
Cash flows from investing activities | ' | ' |
Net additions to property, plant and equipment | -14,556 | -42,323 |
Increase in identifiable intangible assets and other non-current assets | -4,474 | -5,486 |
Net cash provided (used) by investing activities | -19,030 | -47,809 |
Cash flows from financing activities: | ' | ' |
Capital contributions from limited partners | ' | 0 |
Distribution to limited partners | 0 | 0 |
Repayments of long-term debt and capital lease obligations | 0 | 0 |
Payment of debt issuance costs | 0 | 0 |
Proceeds (payments) on intercompany loans | -53,452 | 45,537 |
Proceeds (payments) on intercompany investments | 3,427 | 206,034 |
Net cash provided (used) by financing activities | -50,025 | 251,571 |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash and cash equivalents | 0 | 0 |
Cash and cash equivalents, beginning of period | 0 | 0 |
Cash and cash equivalents, end of period | 0 | 0 |
Non-Guarantor Subsidiaries [Member] | ' | ' |
Cash flows from operating activities: | ' | ' |
Net loss | -10,136 | -338,090 |
Adjustments to reconcile net earnings (loss) to net cash provided | 35,915 | 153,344 |
Net cash provided (used) by operating activities | 25,779 | -184,746 |
Cash flows from investing activities | ' | ' |
Net additions to property, plant and equipment | -98,591 | -39,328 |
Increase in identifiable intangible assets and other non-current assets | 271 | 19 |
Net cash provided (used) by investing activities | -98,320 | -39,309 |
Cash flows from financing activities: | ' | ' |
Capital contributions from limited partners | ' | 0 |
Distribution to limited partners | 0 | 0 |
Repayments of long-term debt and capital lease obligations | 17 | 25 |
Payment of debt issuance costs | 0 | 0 |
Proceeds (payments) on intercompany loans | 2,154 | 75,020 |
Proceeds (payments) on intercompany investments | 188,288 | 136,223 |
Net cash provided (used) by financing activities | 190,459 | 211,268 |
Effect of exchange rate changes on cash and cash equivalents | -151 | 308 |
Net increase (decrease) in cash and cash equivalents | 117,767 | -12,479 |
Cash and cash equivalents, beginning of period | 105,964 | 72,363 |
Cash and cash equivalents, end of period | 223,731 | 59,884 |
Eliminations [Member] | ' | ' |
Cash flows from operating activities: | ' | ' |
Net loss | 444,775 | 755,093 |
Adjustments to reconcile net earnings (loss) to net cash provided | -45,156 | -105,747 |
Net cash provided (used) by operating activities | 399,619 | 649,346 |
Cash flows from investing activities | ' | ' |
Net additions to property, plant and equipment | 191,164 | 69,344 |
Increase in identifiable intangible assets and other non-current assets | 0 | 0 |
Net cash provided (used) by investing activities | 191,164 | 69,344 |
Cash flows from financing activities: | ' | ' |
Capital contributions from limited partners | ' | 0 |
Distribution to limited partners | 0 | 0 |
Repayments of long-term debt and capital lease obligations | 0 | 0 |
Payment of debt issuance costs | 0 | 0 |
Proceeds (payments) on intercompany loans | 0 | 0 |
Proceeds (payments) on intercompany investments | -590,783 | -718,690 |
Net cash provided (used) by financing activities | -590,783 | -718,690 |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash and cash equivalents | 0 | 0 |
Cash and cash equivalents, beginning of period | 0 | 0 |
Cash and cash equivalents, end of period | $0 | $0 |