DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - shares | 3 Months Ended | |
Jul. 01, 2017 | Aug. 03, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | HAEMONETICS CORP | |
Entity Central Index Key | 313,143 | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jul. 1, 2017 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 52,606,339 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Jul. 01, 2017 | Jul. 02, 2016 | |
Income Statement [Abstract] | ||
Net revenues | $ 210,951 | $ 209,956 |
Cost of goods sold | 119,286 | 118,900 |
Gross profit | 91,665 | 91,056 |
Operating expenses: | ||
Research and development | 8,193 | 11,437 |
Selling, general and administrative | 66,861 | 87,500 |
Total operating expenses | 75,054 | 98,937 |
Operating income (loss) | 16,611 | (7,881) |
Gain on divestiture | 8,000 | 0 |
Interest and other expense, net | (1,359) | (2,177) |
Income (loss) before provision for income taxes | 23,252 | (10,058) |
Provision for income taxes | 3,115 | 288 |
Net income (loss) | $ 20,137 | $ (10,346) |
Net earnings (loss) per share - basic (in dollars per share) | $ 0.38 | $ (0.20) |
Net earnings (loss) per share - diluted (in dollars per share) | $ 0.38 | $ (0.20) |
Weighted average shares outstanding | ||
Basic (in shares) | 52,443 | 51,021 |
Diluted (in shares) | 52,811 | 51,021 |
Comprehensive income (loss) | $ 23,766 | $ (11,233) |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jul. 01, 2017 | Apr. 01, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 171,739 | $ 139,564 |
Accounts receivable, less allowance of $2,267 at July 1, 2017 and $2,184 at April 1, 2017 | 151,507 | 152,683 |
Inventories, net | 173,894 | 176,929 |
Prepaid expenses and other current assets | 30,949 | 40,853 |
Total current assets | 528,089 | 510,029 |
Property, plant and equipment, net | 321,953 | 323,862 |
Intangible assets, less accumulated amortization of $224,302 at July 1, 2017 and $215,772 at April 1, 2017 | 173,420 | 177,540 |
Goodwill | 210,930 | 210,841 |
Deferred tax asset, long-term | 4,399 | 3,988 |
Other long-term assets | 12,591 | 12,449 |
Total assets | 1,251,382 | 1,238,709 |
Current liabilities: | ||
Notes payable and current maturities of long-term debt | 65,876 | 61,022 |
Accounts payable | 39,389 | 42,973 |
Accrued payroll and related costs | 31,934 | 43,534 |
Other liabilities | 68,324 | 63,650 |
Total current liabilities | 205,523 | 211,179 |
Long-term debt, net of current maturities | 237,167 | 253,625 |
Deferred tax liability, long-term | 12,818 | 12,114 |
Other long-term liabilities | 23,104 | 22,181 |
Total stockholders’ equity | ||
Common stock, $0.01 par value; Authorized — 150,000,000 shares; Issued and outstanding — 52,522,479 shares at July 1, 2017 and 52,255,495 shares at April 1, 2017 | 525 | 523 |
Additional paid-in capital | 491,436 | 482,044 |
Retained earnings | 310,053 | 289,916 |
Accumulated other comprehensive loss | (29,244) | (32,873) |
Total stockholders’ equity | 772,770 | 739,610 |
Total liabilities and stockholders’ equity | $ 1,251,382 | $ 1,238,709 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands | Jul. 01, 2017 | Apr. 01, 2017 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance | $ 2,267 | $ 2,184 |
Intangible assets, amortization | $ 224,302 | $ 215,772 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 52,522,479 | 52,255,495 |
Common stock, shares outstanding (in shares) | 52,522,479 | 52,255,495 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Jul. 01, 2017 | Jul. 02, 2016 | |
Cash Flows from Operating Activities: | ||
Net income (loss) | $ 20,137 | $ (10,346) |
Non-cash items: | ||
Depreciation and amortization | 21,789 | 22,544 |
Gain on divestiture | (8,000) | 0 |
Provision for losses on accounts receivable and inventory | 928 | 2,571 |
Stock-based compensation expense | 1,343 | 1,840 |
Impairment of assets | 0 | 1,766 |
Other non-cash operating activities | 658 | (650) |
Change in operating assets and liabilities: | ||
Change in accounts receivable | 2,203 | 8,239 |
Change in inventories | 1,417 | (3,721) |
Change in prepaid income taxes | 817 | (932) |
Change in other assets and other liabilities | 8,998 | 1,126 |
Change in accounts payable and accrued expenses | (11,865) | 8,258 |
Net cash provided by operating activities | 38,425 | 30,695 |
Cash Flows from Investing Activities: | ||
Capital expenditures | (13,721) | (22,479) |
Proceeds from divestiture | 9,000 | 0 |
Proceeds from sale of property, plant and equipment | 981 | 87 |
Net cash used in investing activities | (3,740) | (22,392) |
Cash Flows from Financing Activities: | ||
Repayment of term loan borrowings | (11,856) | (7,114) |
Proceeds from employee stock purchase plan | 1,622 | 1,980 |
Proceeds from exercise of stock options | 6,430 | 1,409 |
Net increase (decrease) in short-term loans | 255 | (1,261) |
Net cash used in financing activities | (3,549) | (4,986) |
Effect of exchange rates on cash and cash equivalents | 1,039 | (192) |
Net Change in Cash and Cash Equivalents | 32,175 | 3,125 |
Cash and Cash Equivalents at Beginning of Period | 139,564 | 115,123 |
Cash and Cash Equivalents at End of Period | 171,739 | 118,248 |
Supplemental Disclosures of Cash Flow Information: | ||
Interest paid | 1,825 | 2,072 |
Income taxes paid | 2,151 | 1,541 |
Transfers from inventory to fixed assets for placement of Haemonetics equipment | $ 1,338 | $ 1,764 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 3 Months Ended |
Jul. 01, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION Basis of Presentation Our accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of our management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. All intercompany transactions have been eliminated. Operating results for the three months ended July 1, 2017 are not necessarily indicative of the results that may be expected for the full fiscal year ending March 31, 2018 or any other interim period. These unaudited consolidated financial statements should be read in conjunction with our audited consolidated financial statements and footnotes included in our annual report on Form 10-K for the fiscal year ended April 1, 2017 . We consider events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. We had no significant subsequent events. |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Jul. 01, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | RECENT ACCOUNTING PRONOUNCEMENTS Standards Implemented In March 2016, the FASB issued ASU No. 2016-09, Compensation- Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . The purpose of the update is to simplify several areas of the accounting for share-based payment transactions. We adopted ASU No. 2016-09 on a prospective basis in our first quarter of fiscal 2018; therefore, prior periods have not been adjusted. The adoption of ASU No. 2016-09 did not have a material effect on our financial position or results of operations. ASU No. 2016-09 allows a company to elect to account for award forfeitures as they occur or to continue to estimate forfeitures. We have elected to continue to estimate potential forfeitures. In addition, ASU No. 2016-09 eliminates additional paid in capital pools and requires excess tax benefits and tax deficiencies to be recorded in the consolidated statement of operations when the awards vest or are settled. Amendments related to accounting for excess tax benefits resulted in an immaterial tax benefit for the three months ended July 1, 2017. In connection with the adoption of this new standard, we also recorded a cumulative-effect adjustment to accumulated deficit and deferred tax assets for certain off balance sheet federal and state net operating loss carry-forwards totaling $1.6 million as of April 1, 2017, with an equal offsetting adjustment to the valuation allowance. |
RESTRUCTURING
RESTRUCTURING | 3 Months Ended |
Jul. 01, 2017 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING | RESTRUCTURING On an ongoing basis, we review the global economy, the healthcare industry, and the markets in which we compete to identify opportunities for efficiencies, enhance commercial capabilities, align our resources and offer our customers better solutions. In order to realize these opportunities, we undertake restructuring-type activities to transform our business. During fiscal 2017, we launched a multi-year restructuring initiative designed to reposition our organization and improve our cost structure. This initiative included a reduction of headcount and operating costs, simplification of certain product lines, and modification of manufacturing operations to align with our strategic direction. During the three months ended July 1, 2017 and July 2, 2016, we incurred $2.5 million and $17.7 million , respectively, of restructuring and turnaround costs under the initial phase of the restructuring initiative. This initial phase of the multi-year restructuring initiative is substantially complete. Additionally, during the three months ended July 2, 2016, we recorded $1.1 million of restructuring and turnaround costs under a prior program. We continue to assess non-core and underperforming assets and evaluate opportunities to improve our cost structure as part of our turnaround and expect to incur additional costs and benefits during fiscal 2018 and beyond. The following summarizes the restructuring activity for the three months ended July 1, 2017 : (In thousands) Severance and Other Employee Costs Other Costs Total Restructuring Balance at April 1, 2017 $ 7,001 $ 467 $ 7,468 Costs incurred, net of reversals 350 706 1,056 Payments (2,811 ) (338 ) (3,149 ) Balance at July 1, 2017 $ 4,540 $ 835 $ 5,375 Substantially all of the restructuring costs for the three months ended July 1, 2017 have been included as a component of selling, general and administrative expenses in the accompanying consolidated statements of income (loss). As of July 1, 2017 , we had a restructuring liability of $5.4 million , of which approximately $4.9 million is payable within the next twelve months. In addition to the restructuring costs included in the table above, during the three months ended July 1, 2017 , we also incurred $1.4 million of costs that do not constitute restructuring under ASC 420, Exit and Disposal Cost Obligations, which we refer to as turnaround costs. These costs consist primarily of expenditures directly related to our restructuring initiative and include program management, implementation of the global strategic review initiatives and accelerated depreciation. The tables below present restructuring and turnaround costs by reportable segment: Restructuring costs Three Months Ended (in thousands) July 1, 2017 July 2, 2016 Japan $ 109 $ 874 EMEA 10 3,074 North America Plasma — 375 All Other 937 12,063 Total $ 1,056 $ 16,386 Turnaround costs Three Months Ended (in thousands) July 1, 2017 July 2, 2016 Japan $ — $ 1 EMEA 6 26 North America Plasma 152 — All Other 1,269 2,403 Total $ 1,427 $ 2,430 Total restructuring and turnaround costs $ 2,483 $ 18,816 |
DIVESTITURE
DIVESTITURE | 3 Months Ended |
Jul. 01, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DIVESTITURE | DIVESTITURE On April 27, 2017, we sold our SEBRA line of benchtop and hand sealers to Machine Solutions Inc. because it was no longer aligned with our long-term strategic objectives. In connection with this transaction, we received net proceeds of $9.0 million and recorded a pre-tax gain of $8.0 million . The proceeds received are subject to a post-closing adjustment based on final asset values as determined during the 90 day transition period. The SEBRA portfolio includes a suite of products which primarily include radio frequency sealers that are used to seal tubing as part of the collection of whole blood and blood components, particularly plasma. |
EARNINGS PER SHARE ("EPS")
EARNINGS PER SHARE ("EPS") | 3 Months Ended |
Jul. 01, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE (EPS) | EARNINGS PER SHARE (“EPS”) The following table provides a reconciliation of the numerators and denominators of the basic and diluted earnings per share computations. Three Months Ended (In thousands, except per share amounts) July 1, July 2, Basic EPS Net income (loss) $ 20,137 $ (10,346 ) Weighted average shares 52,443 51,021 Basic income (loss) per share $ 0.38 $ (0.20 ) Diluted EPS Net income (loss) $ 20,137 $ (10,346 ) Basic weighted average shares 52,443 51,021 Net effect of common stock equivalents 368 — Diluted weighted average shares 52,811 51,021 Diluted income (loss) per share $ 0.38 $ (0.20 ) Basic earnings per share is calculated using our weighted-average outstanding common shares. Diluted earnings per share is calculated using our weighted-average outstanding common shares including the dilutive effect of stock awards as determined under the treasury stock method. For the three months ended July 1, 2017 , weighted average shares outstanding, assuming dilution, excludes the impact of 0.7 million anti-dilutive shares. For the three months ended July 2, 2016 , we recognized a net loss; therefore, we excluded the impact of outstanding stock awards from the diluted loss per share calculation as their inclusion would have an anti-dilutive effect. |
PRODUCT WARRANTIES
PRODUCT WARRANTIES | 3 Months Ended |
Jul. 01, 2017 | |
Product Warranties Disclosures [Abstract] | |
PRODUCT WARRANTIES | PRODUCT WARRANTIES We generally provide warranty on parts and labor for one year after the sale and installation of each device. We also warrant our disposables products through their use or expiration. We estimate our potential warranty expense based on our historical warranty experience and periodically assess the adequacy of our warranty accrual, making adjustments as necessary. Three Months Ended (In thousands) July 1, July 2, Warranty accrual as of the beginning of the period $ 176 $ 420 Warranty provision 442 163 Warranty spending (241 ) (234 ) Warranty accrual as of the end of the period $ 377 $ 349 |
INVENTORIES
INVENTORIES | 3 Months Ended |
Jul. 01, 2017 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories are stated at the lower of cost or market and include the cost of material, labor and manufacturing overhead. Cost is determined using the first-in, first-out method. (In thousands) July 1, April 1, Raw materials $ 50,544 $ 52,052 Work-in-process 10,771 10,400 Finished goods 112,579 114,477 Total inventories $ 173,894 $ 176,929 |
DERIVATIVES AND FAIR VALUE MEAS
DERIVATIVES AND FAIR VALUE MEASUREMENTS | 3 Months Ended |
Jul. 01, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES AND FAIR VALUE MEASUREMENTS | DERIVATIVES AND FAIR VALUE MEASUREMENTS We manufacture, market and sell our products globally. For the three months ended July 1, 2017 , 37.9% of our sales were generated outside the U.S., generally in foreign currencies. We also incur certain manufacturing, marketing and selling costs in international markets in local currency. Accordingly, our earnings and cash flows are exposed to market risk from changes in foreign currency exchange rates relative to the U.S. Dollar, our reporting currency. We have a program in place that is designed to mitigate our exposure to changes in foreign currency exchange rates. That program includes the use of derivative financial instruments to minimize for a period of time, the impact on our financial results from changes in foreign exchange rates. We utilize foreign currency forward contracts to hedge the anticipated cash flows from transactions denominated in foreign currencies, primarily the Japanese Yen and the Euro, and to a lesser extent the Swiss Franc, Australian Dollar, Canadian Dollar and the Mexican Peso. This does not eliminate the impact of the volatility of foreign exchange rates. However, because we generally enter into forward contracts one year out, rates are fixed for a one -year period, thereby facilitating financial planning and resource allocation. Designated Foreign Currency Hedge Contracts All of our designated foreign currency hedge contracts as of July 1, 2017 and April 1, 2017 were cash flow hedges under ASC 815, Derivatives and Hedging ("ASC 815"). We record the effective portion of any change in the fair value of designated foreign currency hedge contracts in other comprehensive income (loss) until the related third-party transaction occurs. Once the related third-party transaction occurs, we reclassify the effective portion of any related gain or loss on the designated foreign currency hedge contracts to earnings. In the event the hedged forecasted transaction does not occur, or it becomes probable that it will not occur, we would reclassify the amount of any gain or loss on the related cash flow hedge to earnings at that time. We had designated foreign currency hedge contracts outstanding in the contract amount of $67.4 million as of July 1, 2017 and $68.4 million as of April 1, 2017 . At July 1, 2017 , losses of $0.2 million , net of tax, will be reclassified to earnings within the next twelve months . Substantially all currency cash flow hedges outstanding as of July 1, 2017 mature within twelve months . Non-Designated Foreign Currency Contracts We manage our exposure to changes in foreign currency on a consolidated basis to take advantage of offsetting transactions and balances. We use foreign currency forward contracts as a part of our strategy to manage exposure related to foreign currency denominated monetary assets and liabilities. These foreign currency forward contracts are entered into for periods consistent with currency transaction exposures, generally one month. They are not designated as cash flow or fair value hedges under ASC 815. These forward contracts are marked-to-market with changes in fair value recorded to earnings. We had non-designated foreign currency hedge contracts under ASC 815 outstanding in the contract amount of $47.7 million as of July 1, 2017 and $55.4 million as of April 1, 2017 . Interest Rate Swaps On December 21, 2012, we entered into two interest rate swap agreements (the "Swaps") on a total notional amount of $250.0 million of debt. The Swaps are amortizing and mature on August 1, 2017. We designated the Swaps as cash flow hedges of variable interest rate risk associated with $250.0 million of indebtedness. As of July 1, 2017 , the notional amount of these Swaps was $50.0 million . For three months ended July 1, 2017 and July 2, 2016 , we recorded nominal activity in accumulated other comprehensive loss to recognize the effective portion of the fair value of interest rate swaps that qualify as cash flow hedges. Fair Value of Derivative Instruments The following table presents the effect of our derivative instruments designated as cash flow hedges and those not designated as hedging instruments under ASC 815 in our consolidated statements of income (loss) and comprehensive income (loss) for the three months ended July 1, 2017 : (In thousands) Amount of (Loss) Gain Amount of (Loss) Gain Reclassified Location in Income (Loss) and Comprehensive Income (Loss) Amount of Gain (Loss) Excluded from Testing Location in Designated foreign currency hedge contracts, net of tax $ (207 ) $ (30 ) Net revenues, COGS, and SG&A $ 309 Interest and other expense, net Non-designated foreign currency hedge contracts — — $ (210 ) Interest and other expense, net Designated interest rate swaps, net of tax $ (39 ) Interest and other expense, net We did not have fair value hedges or net investment hedges outstanding as of July 1, 2017 or April 1, 2017 . As of July 1, 2017 , no deferred tax assets were recognized for designated foreign currency hedges. ASC 815 requires all derivative instruments to be recognized at their fair values as either assets or liabilities on the balance sheet. We determine the fair value of our derivative instruments using the framework prescribed by ASC 820, Fair Value Measurements and Disclosures , by considering the estimated amount we would receive or pay to sell or transfer these instruments at the reporting date and by taking into account current interest rates, currency exchange rates, current interest rate curves, interest rate volatilities, the creditworthiness of the counterparty for assets, and our creditworthiness for liabilities. In certain instances, we may utilize financial models to measure fair value. Generally, we use inputs that include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; other observable inputs for the asset or liability; and inputs derived principally from, or corroborated by, observable market data by correlation or other means. As of July 1, 2017 , we have classified our derivative assets and liabilities within Level 2 of the fair value hierarchy prescribed by ASC 815, as discussed below, because these observable inputs are available for substantially the full term of our derivative instruments. The following tables present the fair value of our derivative instruments as they appear in our consolidated balance sheets as of July 1, 2017 and April 1, 2017 : (In thousands) Location in As of July 1, 2017 As of April 1, 2017 Derivative Assets: Designated foreign currency hedge contracts Other current assets $ 1,633 $ 1,645 Non-designated foreign currency hedge contracts Other current assets $ 96 $ 218 Designated interest rate swaps Other current assets $ 25 $ 64 $ 1,754 $ 1,927 Derivative Liabilities: Designated foreign currency hedge contracts Other current liabilities $ 1,306 $ 894 Non-designated foreign currency hedge contracts Other current liabilities $ 149 $ 72 Designated interest rate swaps Other current liabilities $ — $ — $ 1,455 $ 966 Other Fair Value Measurements Fair value is defined as the exit price that would be received from the sale of an asset or paid to transfer a liability, using assumptions that market participants would use in pricing an asset or liability. The fair value guidance establishes the following three-level hierarchy used for measuring fair value: • Level 1 — Inputs to the valuation methodology are quoted market prices for identical assets or liabilities. • Level 2 — Inputs to the valuation methodology are other observable inputs, including quoted market prices for similar assets or liabilities and market-corroborated inputs. • Level 3 — Inputs to the valuation methodology are unobservable inputs based on management’s best estimate of inputs market participants would use in pricing the asset or liability at the measurement date, including assumptions about risk. Our money market funds carried at fair value are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. Fair Value Measured on a Recurring Basis Financial assets and financial liabilities measured at fair value on a recurring basis consist of the following as of July 1, 2017 and April 1, 2017 . As of July 1, 2017 (In thousands) Level 1 Level 2 Total Assets Money market funds $ 95,718 $ — $ 95,718 Designated foreign currency hedge contracts — $ 1,633 $ 1,633 Non-designated foreign currency hedge contracts $ — $ 96 $ 96 Designated interest rate swaps $ — $ 25 $ 25 $ 95,718 $ 1,754 $ 97,472 Liabilities Designated foreign currency hedge contracts $ — $ 1,306 $ 1,306 Non-designated foreign currency hedge contracts $ — $ 149 $ 149 $ — $ 1,455 $ 1,455 As of April 1, 2017 Level 1 Level 2 Total Assets Money market funds $ 80,676 $ — $ 80,676 Designated foreign currency hedge contracts — 1,645 1,645 Non-designated foreign currency hedge contracts — 218 218 Designated interest rate swaps — 64 64 $ 80,676 $ 1,927 $ 82,603 Liabilities Designated foreign currency hedge contracts $ — $ 894 $ 894 Non-designated foreign currency hedge contracts — 72 72 $ — $ 966 $ 966 Other Fair Value Disclosures The Term Loan (which is carried at amortized cost), accounts receivable and accounts payable approximate fair value. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Jul. 01, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES We conduct business globally and report our results of operations in a number of foreign jurisdictions in addition to the United States. Our reported tax rate is generally lower than the U.S. federal statutory rate as the income tax rates in the foreign jurisdictions in which we operate are generally lower than the U.S. statutory tax rate. Additionally, our reported tax rate is lower than the statutory tax rate as a result of the release of valuation allowance against tax attributes in certain jurisdictions which can be utilized to offset current year earnings. For the three months ended July 1, 2017 and July 2, 2016 we reported income tax provisions of $3.1 million and $0.3 million , respectively, representing effective tax rates of 13.4% and ( 2.9% ), respectively. The income tax provision for the three months ended July 1, 2017 was primarily attributable to applying the Company’s estimated annual effective tax rate to its year-to-date consolidated income before provision for income taxes, and includes a discrete tax provision of $0.4 million for international items and tax reserves. The income tax provision for the three months ended July 2, 2016 was primarily attributable to applying the Company’s estimated annual effective tax rate to its year-to-date consolidated loss before provision for income taxes, and includes a discrete tax provision of $1.4 million for an uncertain tax position that was triggered by a reduction in workforce during the quarter ended July 2, 2016. We had previously negotiated a tax holiday in one of our foreign subsidiaries under which we were required to maintain certain levels of headcount for a multi-year period which we will not satisfy as a result of our workforce reduction. We are subject to a potential tax assessment related to historical tax years as a result of the impact of the workforce reduction approved in the quarter ending July 2, 2016. The tax provision associated with this tax reserve establishment was partially offset by the tax benefit provided on our year-to-date loss. We are in a three year cumulative loss position in the U.S. and, accordingly, maintain a valuation allowance against our U.S. deferred tax assets. We also maintain a valuation allowance against certain foreign deferred tax assets primarily in Switzerland, Puerto Rico, Luxembourg and France which we have concluded are not more-likely-than-not realizable. Unrecognized Tax Benefits Unrecognized tax benefits represent uncertain tax positions for which reserves have been established. As of July 1, 2017 , we had $3.4 million of unrecognized tax benefits of which $1.5 million would impact the effective tax rate, if recognized. As of July 1, 2017 , we anticipate that the liability for unrecognized tax benefits for uncertain tax positions could change by up to $1.5 million in the next twelve months as a result of closure of various statutes of limitations or settlements. We consistently recognize interest and penalties related to Federal, state and foreign income tax matters in income tax expense. Approximately $0.2 million of gross interest and penalties were accrued at July 1, 2017 and April 1, 2017 and are not included in the amounts above. Tax expense associated with accrued interest and penalties was insignificant for both the three months ended July 1, 2017 and July 2, 2016 . We conduct business globally and, as a result, file consolidated and separate Federal, state and foreign income tax returns in multiple jurisdictions. In the normal course of business, we are subject to examination by taxing authorities throughout the world. With a few exceptions, we are no longer subject to U.S. federal, state, or local income tax examinations for years before 2014 and foreign income tax examinations for years before 2012. |
DEBT
DEBT | 3 Months Ended |
Jul. 01, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT We currently have a credit agreement ("Credit Agreement") with certain lenders (together, “Lenders”) which provides for a $475.0 million term loan ("Term Loan") and a $100.0 million revolving loan ("Revolving Credit Facility" and together with the Term Loan, the "Credit Facilities"). Interest is based on the Adjusted LIBOR plus a range of 1.125% to 1.500% depending on achievement of leverage ratios and customary credit terms which include financial and negative covenants. The Credit Facilities mature on July 1, 2019 . At July 1, 2017 , $303.5 million was outstanding under the Term Loan and no amount was outstanding on the Revolving Credit Facility. During the three months ended July 1, 2017 , we paid $11.9 million in principal repayments for the Term Loan. We were in compliance with the leverage and interest coverage ratios specified in the Credit Agreement as well as all other bank covenants as of July 1, 2017 . |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Jul. 01, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES The Company is a party to various other legal proceedings and claims arising out of the ordinary course of its business. We believe that except for those matters described below, there are no other proceedings or claims pending against us the ultimate resolution of which could have a material adverse effect on our financial condition or results of operations. At each reporting period, management evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under ASC 450, Contingencies, for all matters. Legal costs are expensed as incurred. Litigation and Related Matters Italian Employment Litigation Our Italian manufacturing subsidiary is party to several actions initiated by former employees of our facility in Ascoli-Piceno, Italy. We ceased operations at the facility in fiscal 2014 and sold the property in fiscal 2017. These include actions claiming (i) working conditions and minimum salaries should have been established by either a different classification under their national collective bargaining agreement or a different agreement altogether, (ii) certain solidarity agreements, which are arrangements between the Company, employees and the government to continue full pay and benefits for employees who would otherwise be terminated in times of low demand, are void, and (iii) rights to payment of the extra time used for changing into and out of the working clothes at the beginning and end of each shift. In addition, a union represented in the Ascoli plant filed an action claiming that the Company discriminated against it in favor of three other represented unions by (i) interfering with an employee referendum, (ii) interfering with an employee petition to recall union representatives from office, and (iii) excluding the union from certain meetings. Finally, we have been added as defendants on claims filed against Pall Corporation prior to our acquisition of the plant in August 2012. These claims relate to agreements to "freeze" benefit allowances for a certain period in exchange for Pall's commitments on hiring and plant investment. As of July 1, 2017 , the total amount of damages claimed by the plaintiffs in these matters is approximately $4.7 million . At this point in the proceedings, we believe losses are unlikely and therefore no amounts have been accrued. In the future, we may receive adverse rulings from the courts which could change our judgment on these cases. SOLX Arbitration In July 2016, H2 Equity, LLC, formerly known as Hemerus Corporation, filed an arbitration claim for $17 million in milestone and royalty payments allegedly owed as part of our acquisition of the filter and storage solution business from Hemerus Medical, LLC ("Hemerus") in fiscal 2014. The acquired storage solution is referred to as SOLX. At the closing in April 2013, Haemonetics paid Hemerus a total of $24 million and agreed to a $3 million milestone payment due when the United States Food and Drug Administration ("FDA") approved a new indication for SOLX (the “24-Hour Approval”) using a filter acquired from Hemerus. We also agreed to make future royalty payments up to a cumulative maximum of $14 million based on the sale of products incorporating SOLX over a ten year period. Due to performance issues with the Hemerus filter, Haemonetics filed for, and received, the 24-Hour Approval using a Haemonetics filter. Accordingly, Haemonetics did not pay Hemerus the $3 million milestone payment because the 24-Hour Approval was obtained using a Haemonetics filter, not a Hemerus filter. In addition, we have not paid any royalties to date as we have not made any sales of products incorporating SOLX. H2 Equity claims, in part, that we owe them $3 million for the receipt of the 24-Hour Approval despite the use of a Haemonetics filter to obtain the approval and that we have failed to make commercially reasonable efforts to market and sell products incorporating SOLX. While we believe that we have meritorious defenses to these claims, as of July 1, 2017 we have recorded a liability of $0.4 million which is reflective of the current settlement discussions. Product Recall In June 2016, we issued a voluntary recall of certain whole blood collection kits sold to our Blood Center customers in the U.S. The recall resulted from some collection sets' filters failing to adequately remove leukocytes from collected blood. As a result of the recall, our blood center customers may have conducted further tests to confirm the blood was adequately leukoreduced, sold the blood labeled as non-leukoreduced at a lower price or discarded the blood collected using the defective sets. We recorded $7.1 million of charges during fiscal 2017, which consisted of $3.7 million of charges associated with customer returns and inventory reserves and $3.4 million of charges associated with customer claims. Although there have been no additional charges recorded in the current period, we may record incremental charges in future periods. The $3.4 million liability associated with customer claims are based on claims seeking reimbursement for $14.2 million in losses sustained as a result of the recall. We believe it is probable that we will incur expenses as a result of these claims and that our range of loss is $3.4 million to $14.2 million , however, we do not have sufficient information to develop a best estimate within this range. Accordingly, during fiscal 2017 we recorded a liability of $3.4 million , which represents the low end of the range. While the customers making these claims purchased substantially all the affected units, incremental charges may be recorded in future periods as additional customer returns and claims data becomes available. We have an enforceable insurance policy in place which we believe provides coverage for a portion of the claims received to date. Accordingly, as of July 1, 2017 , we had an insurance receivable of $2.9 million . We will assess the potential for additional insurance recoveries as we receive more information about customer claims in future reporting periods. |
SEGMENT AND ENTERPRISE-WIDE INF
SEGMENT AND ENTERPRISE-WIDE INFORMATION | 3 Months Ended |
Jul. 01, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT AND ENTERPRISE-WIDE INFORMATION | SEGMENT AND ENTERPRISE-WIDE INFORMATION We determine our reportable segments by first identifying our operating segments, and then by assessing whether any components of these segments constitute a business for which discrete financial information is available and where segment management regularly reviews the operating results of that component. Our operating segments are based primarily on geography. North America Plasma is a separate operating segment with dedicated segment management due the size and scale of the Plasma business unit. We aggregate components within an operating segment that have similar economic characteristics. The Company’s reportable segments are as follows: • Japan • EMEA • North America Plasma • All Other The Company has aggregated the Americas Blood Center and Hospital and Asia - Pacific operating segments into the All Other reportable segment based upon their similar operational and economic characteristics, including similarity of operating margin. Management measures and evaluates the operating segments based on operating income. Management excludes certain corporate expenses from segment operating income. In addition, certain amounts that management considers to be non-recurring or non-operational are excluded from segment operating income because management evaluates the operating results of the segments excluding such items. These items include restructuring and turnaround costs, deal amortization, and gains on divestitures. Although these amounts are excluded from segment operating income, as applicable, they are included in the reconciliations that follow. Management measures and evaluates the Company's net revenues and operating income using internally derived standard currency exchange rates that remain constant from year to year; therefore, segment information is presented on this basis. During the first quarter of fiscal 2018, management changed the cost reporting structure such that a portion of corporate expenses were reclassified into the operating segments. Accordingly, the prior year numbers have been updated to reflect this reclassification. Selected information by business segment is presented below: Three Months Ended (In thousands) July 1, July 2, Net revenues Japan $ 15,232 $ 14,566 EMEA 43,008 45,741 North America Plasma 77,536 73,475 All Other 78,174 78,020 Net revenues before foreign exchange impact 213,950 211,802 Effect of exchange rates (2,999 ) (1,846 ) Net revenues $ 210,951 $ 209,956 Three Months Ended (In thousands) July 1, July 2, Segment operating income Japan $ 6,738 $ 6,156 EMEA 8,571 8,276 North America Plasma 24,102 25,168 All Other 27,686 27,170 Segment operating income 67,097 66,770 Corporate operating expenses (39,311 ) (46,139 ) Effect of exchange rates (2,201 ) (1,306 ) Restructuring and turnaround costs (2,483 ) (18,816 ) Deal amortization (6,491 ) (7,075 ) Asset impairments — (1,315 ) Operating income $ 16,611 $ (7,881 ) Our products are organized into four categories for purposes of evaluating their growth potential: Plasma, Blood Center, Cell Processing and Hemostasis Management. Management reviews revenue trends based on these business units; however, no other financial information is currently available on this basis. Net revenues by business unit are as follows: Three Months Ended (In thousands) July 1, July 2, Plasma $ 101,507 $ 97,649 Blood Center 65,565 70,943 Cell Processing 26,336 26,076 Hemostasis Management 17,543 15,288 Net revenues $ 210,951 $ 209,956 Net revenues generated in our principle operating regions on a reported basis are as follows: Three Months Ended (In thousands) July 1, July 2, United States $ 131,052 $ 125,700 Japan 14,916 14,964 Europe 37,222 40,367 Asia 25,940 26,992 Other 1,821 1,933 Net revenues $ 210,951 $ 209,956 |
CAPITALIZATION OF SOFTWARE DEVE
CAPITALIZATION OF SOFTWARE DEVELOPMENT COSTS | 3 Months Ended |
Jul. 01, 2017 | |
Research and Development [Abstract] | |
CAPITALIZATION OF SOFTWARE DEVELOPMENT COSTS | CAPITALIZATION OF SOFTWARE DEVELOPMENT COSTS For costs incurred related to the development of software to be sold, leased or otherwise marketed, we apply the provisions of ASC 985-20, Software - Costs of Software to be Sold, Leased or Marketed , which specifies that costs incurred internally in researching and developing a computer software product should be charged to expense until technological feasibility has been established for the product. Once technological feasibility is established, all software costs should be capitalized until the product is available for general release to customers. We capitalized $3.1 million and $3.7 million in software development costs for ongoing initiatives during the three months ended July 1, 2017 and July 2, 2016 , respectively. At July 1, 2017 and April 1, 2017 , we have a total of $65.8 million and $62.7 million of capitalized software costs, respectively, of which $15.8 million and $12.7 million are related to in-process software development initiatives, respectively. During the three months ended July 2, 2016 , $2.5 million of capitalized costs were placed into service. We did not place any capitalized costs into service for the three months ended July 1, 2017 . The costs capitalized for each project are included in intangible assets in the consolidated financial statements. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 3 Months Ended |
Jul. 01, 2017 | |
Stockholders' Equity Note [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE LOSS The components of Accumulated Other Comprehensive Loss are as follows: (In thousands) Foreign Currency Defined Benefit Plans Net Unrealized Gain/Loss on Derivatives Total Balance as of April 1, 2017 $ (29,835 ) $ (2,272 ) $ (766 ) $ (32,873 ) Other comprehensive income (loss) before reclassifications (1) 3,845 — (246 ) 3,599 Amounts reclassified from Accumulated Other Comprehensive Loss (1) — — 30 30 Net current period other comprehensive income (loss) 3,845 — (216 ) 3,629 Balance as of July 1, 2017 $ (25,990 ) $ (2,272 ) $ (982 ) $ (29,244 ) (1) Presented net of income taxes, the amounts of which are insignificant. |
RESTRUCTURING (Tables)
RESTRUCTURING (Tables) | 3 Months Ended |
Jul. 01, 2017 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | The following summarizes the restructuring activity for the three months ended July 1, 2017 : (In thousands) Severance and Other Employee Costs Other Costs Total Restructuring Balance at April 1, 2017 $ 7,001 $ 467 $ 7,468 Costs incurred, net of reversals 350 706 1,056 Payments (2,811 ) (338 ) (3,149 ) Balance at July 1, 2017 $ 4,540 $ 835 $ 5,375 |
Schedule of Restructuring and Related Costs | The tables below present restructuring and turnaround costs by reportable segment: Restructuring costs Three Months Ended (in thousands) July 1, 2017 July 2, 2016 Japan $ 109 $ 874 EMEA 10 3,074 North America Plasma — 375 All Other 937 12,063 Total $ 1,056 $ 16,386 Turnaround costs Three Months Ended (in thousands) July 1, 2017 July 2, 2016 Japan $ — $ 1 EMEA 6 26 North America Plasma 152 — All Other 1,269 2,403 Total $ 1,427 $ 2,430 Total restructuring and turnaround costs $ 2,483 $ 18,816 |
EARNINGS PER SHARE ("EPS") (Tab
EARNINGS PER SHARE ("EPS") (Tables) | 3 Months Ended |
Jul. 01, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share Reconciliation | The following table provides a reconciliation of the numerators and denominators of the basic and diluted earnings per share computations. Three Months Ended (In thousands, except per share amounts) July 1, July 2, Basic EPS Net income (loss) $ 20,137 $ (10,346 ) Weighted average shares 52,443 51,021 Basic income (loss) per share $ 0.38 $ (0.20 ) Diluted EPS Net income (loss) $ 20,137 $ (10,346 ) Basic weighted average shares 52,443 51,021 Net effect of common stock equivalents 368 — Diluted weighted average shares 52,811 51,021 Diluted income (loss) per share $ 0.38 $ (0.20 ) |
PRODUCT WARRANTIES (Tables)
PRODUCT WARRANTIES (Tables) | 3 Months Ended |
Jul. 01, 2017 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Product Warranty Liability | We estimate our potential warranty expense based on our historical warranty experience and periodically assess the adequacy of our warranty accrual, making adjustments as necessary. Three Months Ended (In thousands) July 1, July 2, Warranty accrual as of the beginning of the period $ 176 $ 420 Warranty provision 442 163 Warranty spending (241 ) (234 ) Warranty accrual as of the end of the period $ 377 $ 349 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Jul. 01, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories are stated at the lower of cost or market and include the cost of material, labor and manufacturing overhead. Cost is determined using the first-in, first-out method. (In thousands) July 1, April 1, Raw materials $ 50,544 $ 52,052 Work-in-process 10,771 10,400 Finished goods 112,579 114,477 Total inventories $ 173,894 $ 176,929 |
DERIVATIVES AND FAIR VALUE ME24
DERIVATIVES AND FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Jul. 01, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Effect of Derivative Instruments Designated as Cash Flow Hedges and Those Not Designated as Hedging Instruments | The following table presents the effect of our derivative instruments designated as cash flow hedges and those not designated as hedging instruments under ASC 815 in our consolidated statements of income (loss) and comprehensive income (loss) for the three months ended July 1, 2017 : (In thousands) Amount of (Loss) Gain Amount of (Loss) Gain Reclassified Location in Income (Loss) and Comprehensive Income (Loss) Amount of Gain (Loss) Excluded from Testing Location in Designated foreign currency hedge contracts, net of tax $ (207 ) $ (30 ) Net revenues, COGS, and SG&A $ 309 Interest and other expense, net Non-designated foreign currency hedge contracts — — $ (210 ) Interest and other expense, net Designated interest rate swaps, net of tax $ (39 ) Interest and other expense, net |
Schedule of Fair Value of Derivative Instruments as They Appear in Consolidated Balance Sheets | The following tables present the fair value of our derivative instruments as they appear in our consolidated balance sheets as of July 1, 2017 and April 1, 2017 : (In thousands) Location in As of July 1, 2017 As of April 1, 2017 Derivative Assets: Designated foreign currency hedge contracts Other current assets $ 1,633 $ 1,645 Non-designated foreign currency hedge contracts Other current assets $ 96 $ 218 Designated interest rate swaps Other current assets $ 25 $ 64 $ 1,754 $ 1,927 Derivative Liabilities: Designated foreign currency hedge contracts Other current liabilities $ 1,306 $ 894 Non-designated foreign currency hedge contracts Other current liabilities $ 149 $ 72 Designated interest rate swaps Other current liabilities $ — $ — $ 1,455 $ 966 |
Schedule of Financial Assets and Financial Liabilities Measured at Fair Value on a Recurring Basis | Financial assets and financial liabilities measured at fair value on a recurring basis consist of the following as of July 1, 2017 and April 1, 2017 . As of July 1, 2017 (In thousands) Level 1 Level 2 Total Assets Money market funds $ 95,718 $ — $ 95,718 Designated foreign currency hedge contracts — $ 1,633 $ 1,633 Non-designated foreign currency hedge contracts $ — $ 96 $ 96 Designated interest rate swaps $ — $ 25 $ 25 $ 95,718 $ 1,754 $ 97,472 Liabilities Designated foreign currency hedge contracts $ — $ 1,306 $ 1,306 Non-designated foreign currency hedge contracts $ — $ 149 $ 149 $ — $ 1,455 $ 1,455 As of April 1, 2017 Level 1 Level 2 Total Assets Money market funds $ 80,676 $ — $ 80,676 Designated foreign currency hedge contracts — 1,645 1,645 Non-designated foreign currency hedge contracts — 218 218 Designated interest rate swaps — 64 64 $ 80,676 $ 1,927 $ 82,603 Liabilities Designated foreign currency hedge contracts $ — $ 894 $ 894 Non-designated foreign currency hedge contracts — 72 72 $ — $ 966 $ 966 |
SEGMENT AND ENTERPRISE-WIDE I25
SEGMENT AND ENTERPRISE-WIDE INFORMATION (Tables) | 3 Months Ended |
Jul. 01, 2017 | |
Segment Reporting [Abstract] | |
Selected Information by Business Segment | Selected information by business segment is presented below: Three Months Ended (In thousands) July 1, July 2, Net revenues Japan $ 15,232 $ 14,566 EMEA 43,008 45,741 North America Plasma 77,536 73,475 All Other 78,174 78,020 Net revenues before foreign exchange impact 213,950 211,802 Effect of exchange rates (2,999 ) (1,846 ) Net revenues $ 210,951 $ 209,956 Three Months Ended (In thousands) July 1, July 2, Segment operating income Japan $ 6,738 $ 6,156 EMEA 8,571 8,276 North America Plasma 24,102 25,168 All Other 27,686 27,170 Segment operating income 67,097 66,770 Corporate operating expenses (39,311 ) (46,139 ) Effect of exchange rates (2,201 ) (1,306 ) Restructuring and turnaround costs (2,483 ) (18,816 ) Deal amortization (6,491 ) (7,075 ) Asset impairments — (1,315 ) Operating income $ 16,611 $ (7,881 ) |
Schedule of Revenues by Product Line and Geographic Regions | Net revenues by business unit are as follows: Three Months Ended (In thousands) July 1, July 2, Plasma $ 101,507 $ 97,649 Blood Center 65,565 70,943 Cell Processing 26,336 26,076 Hemostasis Management 17,543 15,288 Net revenues $ 210,951 $ 209,956 Net revenues generated in our principle operating regions on a reported basis are as follows: Three Months Ended (In thousands) July 1, July 2, United States $ 131,052 $ 125,700 Japan 14,916 14,964 Europe 37,222 40,367 Asia 25,940 26,992 Other 1,821 1,933 Net revenues $ 210,951 $ 209,956 |
(Tables)
(Tables) | 3 Months Ended |
Jul. 01, 2017 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The components of Accumulated Other Comprehensive Loss are as follows: (In thousands) Foreign Currency Defined Benefit Plans Net Unrealized Gain/Loss on Derivatives Total Balance as of April 1, 2017 $ (29,835 ) $ (2,272 ) $ (766 ) $ (32,873 ) Other comprehensive income (loss) before reclassifications (1) 3,845 — (246 ) 3,599 Amounts reclassified from Accumulated Other Comprehensive Loss (1) — — 30 30 Net current period other comprehensive income (loss) 3,845 — (216 ) 3,629 Balance as of July 1, 2017 $ (25,990 ) $ (2,272 ) $ (982 ) $ (29,244 ) (1) Presented net of income taxes, the amounts of which are insignificant. |
RECENT ACCOUNTING PRONOUNCEME27
RECENT ACCOUNTING PRONOUNCEMENTS (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Jul. 01, 2017 | Jul. 02, 2016 | Apr. 01, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Cumulative-effect adjustment to accumulated deficit and deferred tax assets for certain off balance sheet federal and state net operating loss carry-forwards | $ 0.4 | $ 1.4 | |
Accounting Standards Update 2016-09 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Cumulative-effect adjustment to accumulated deficit and deferred tax assets for certain off balance sheet federal and state net operating loss carry-forwards | $ 1.6 |
RESTRUCTURING (Narrative) (Deta
RESTRUCTURING (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jul. 01, 2017 | Jul. 02, 2016 | Apr. 01, 2017 | |
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring and turnaround costs | $ 2,483 | $ 18,816 | |
Restructuring costs | 1,056 | 16,386 | |
Restructuring Reserve | 5,375 | $ 7,468 | |
Restructuring Charges Payable In Next Twelve Months | 4,900 | ||
Turnaround costs | 1,427 | 2,430 | |
Fiscal 2017 Initiative [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring costs | 2,500 | 17,700 | |
Prior Restructuring Program [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring costs | $ 1,100 | ||
Severance and Other Employee Costs | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring costs | 350 | ||
Restructuring Reserve | 4,540 | 7,001 | |
Other Costs | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring costs | 706 | ||
Restructuring Reserve | $ 835 | $ 467 |
RESTRUCTURING (Schedule of Rest
RESTRUCTURING (Schedule of Restructuring Reserve by Type of Cost) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jul. 01, 2017 | Jul. 02, 2016 | |
Restructuring Reserve [Roll Forward] | ||
Balance at April 1, 2017 | $ 7,468 | |
Costs incurred, net of reversals | 1,056 | $ 16,386 |
Payments | (3,149) | |
Balance at July 1, 2017 | 5,375 | |
Severance and Other Employee Costs | ||
Restructuring Reserve [Roll Forward] | ||
Balance at April 1, 2017 | 7,001 | |
Costs incurred, net of reversals | 350 | |
Payments | (2,811) | |
Balance at July 1, 2017 | 4,540 | |
Other Costs | ||
Restructuring Reserve [Roll Forward] | ||
Balance at April 1, 2017 | 467 | |
Costs incurred, net of reversals | 706 | |
Payments | (338) | |
Balance at July 1, 2017 | $ 835 |
RESTRUCTURING (Schedule of Re30
RESTRUCTURING (Schedule of Restructuring and Related Costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jul. 01, 2017 | Jul. 02, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | $ 1,056 | $ 16,386 |
Turnaround costs | 1,427 | 2,430 |
Total restructuring and turnaround costs | 2,483 | 18,816 |
Severance and Other Employee Costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 350 | |
Other Costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 706 | |
Japan | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 109 | 874 |
Turnaround costs | 0 | 1 |
EMEA | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 10 | 3,074 |
Turnaround costs | 6 | 26 |
North America Plasma | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 0 | 375 |
Turnaround costs | 152 | 0 |
All Other | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 937 | 12,063 |
Turnaround costs | $ 1,269 | $ 2,403 |
DIVESTITURE (Details)
DIVESTITURE (Details) - USD ($) $ in Thousands | Apr. 27, 2017 | Jul. 01, 2017 | Jul. 02, 2016 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Proceeds from divestiture | $ 9,000 | $ 0 | |
Gain on divestiture | $ 8,000 | $ 0 | |
SEBRA Sealers Product Line [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Proceeds from divestiture | $ 9,000 | ||
Gain on divestiture | $ 8,000 | ||
Transition period | 90 days |
EARNINGS PER SHARE ("EPS") (Sch
EARNINGS PER SHARE ("EPS") (Schedule of Earnings Per Share Reconciliation) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Jul. 01, 2017 | Jul. 02, 2016 | |
Basic EPS | ||
Net income (loss) | $ 20,137 | $ (10,346) |
Basic weighted average shares (in shares) | 52,443 | 51,021 |
Basic income (loss) per share (in dollars per share) | $ 0.38 | $ (0.20) |
Diluted EPS | ||
Net income (loss) | $ 20,137 | $ (10,346) |
Basic weighted average shares (in shares) | 52,443 | 51,021 |
Net effect of common stock equivalents (in shares) | 368 | 0 |
Diluted weighted average shares (in shares) | 52,811 | 51,021 |
Diluted income (loss) per share (in dollars per share) | $ 0.38 | $ (0.20) |
Anti-dilutive shares excluded (in shares) | 700 |
PRODUCT WARRANTIES (Schedule of
PRODUCT WARRANTIES (Schedule of Product Warranty Liability) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jul. 01, 2017 | Jul. 02, 2016 | |
Product Warranties Disclosures [Abstract] | ||
General Warranty Period on Parts and Labor | 1 year | |
Product Warranties [Roll Forward] | ||
Warranty accrual as of the beginning of the period | $ 176 | $ 420 |
Warranty provision | 442 | 163 |
Warranty spending | (241) | (234) |
Warranty accrual as of the end of the period | $ 377 | $ 349 |
INVENTORIES (Schedule of Invent
INVENTORIES (Schedule of Inventories) (Details) - USD ($) $ in Thousands | Jul. 01, 2017 | Apr. 01, 2017 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 50,544 | $ 52,052 |
Work-in-process | 10,771 | 10,400 |
Finished goods | 112,579 | 114,477 |
Inventories, net | $ 173,894 | $ 176,929 |
DERIVATIVES AND FAIR VALUE ME35
DERIVATIVES AND FAIR VALUE MEASUREMENTS (Schedule of Effect of Derivative Instruments Designated as Cash Flow Hedges and Those Not Designated as Hedging Instruments) (Details) $ in Thousands | 3 Months Ended |
Jul. 01, 2017USD ($) | |
Designated as Hedging Instrument | Cash Flow Hedging | Net revenues, COGS, and SG&A | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | $ 207 |
Amount of Gain/(Loss) Reclassified from AOCI into Earnings (Effective Portion) | 30 |
Designated as Hedging Instrument | Cash Flow Hedging | Interest and other expense, net | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Amount Excluded from Effectiveness Testing | 309 |
Designated as Hedging Instrument | Interest Rate Swap [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Amount Excluded from Effectiveness Testing | |
Designated as Hedging Instrument | Interest Rate Swap [Member] | Interest and other expense, net | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | (39) |
Amount of Gain/(Loss) Reclassified from AOCI into Earnings (Effective Portion) | |
Not Designated as Hedging Instrument | Foreign Exchange Contract | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | 0 |
Amount of Gain/(Loss) Reclassified from AOCI into Earnings (Effective Portion) | 0 |
Not Designated as Hedging Instrument | Foreign Exchange Contract | Interest and other expense, net | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Amount Excluded from Effectiveness Testing | $ (210) |
DERIVATIVES AND FAIR VALUE ME36
DERIVATIVES AND FAIR VALUE MEASUREMENTS (Schedule of Fair Value of Derivative Instruments as They Appear in Consolidated Balance Sheets) (Details) - USD ($) $ in Thousands | Jul. 01, 2017 | Apr. 01, 2017 |
Designated as Hedging Instrument | ||
Derivative Assets: | ||
Derivative Assets | $ 1,754 | $ 1,927 |
Derivative Liabilities: | ||
Derivative Liabilities | 1,455 | 966 |
Designated as Hedging Instrument | Foreign Exchange Contract | Other Current Assets | ||
Derivative Assets: | ||
Derivative Assets | 1,633 | 1,645 |
Designated as Hedging Instrument | Foreign Exchange Contract | Other Current Liabilities | ||
Derivative Liabilities: | ||
Derivative Liabilities | 1,306 | 894 |
Designated as Hedging Instrument | Interest Rate Swap [Member] | Other Current Assets | ||
Derivative Assets: | ||
Derivative Assets | 25 | 64 |
Designated as Hedging Instrument | Interest Rate Swap [Member] | Other Current Liabilities | ||
Derivative Liabilities: | ||
Derivative Liabilities | 0 | 0 |
Not Designated as Hedging Instrument | Foreign Exchange Contract | Other Current Assets | ||
Derivative Assets: | ||
Derivative Assets | 96 | 218 |
Not Designated as Hedging Instrument | Foreign Exchange Contract | Other Current Liabilities | ||
Derivative Liabilities: | ||
Derivative Liabilities | $ 149 | $ 72 |
DERIVATIVES AND FAIR VALUE ME37
DERIVATIVES AND FAIR VALUE MEASUREMENTS (Schedule of Financial Assets and Financial Liabilities Measured at Fair Value) (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Jul. 01, 2017 | Apr. 01, 2017 |
Assets | ||
Money market funds | $ 95,718 | $ 80,676 |
Designated interest rate swaps | 25 | 64 |
Assets fair value | 97,472 | 82,603 |
Liabilities | ||
Liabilities fair value | 1,455 | 966 |
Quoted Market Prices for Identical Assets (Level 1) | ||
Assets | ||
Money market funds | 95,718 | 80,676 |
Designated interest rate swaps | 0 | 0 |
Assets fair value | 95,718 | 80,676 |
Liabilities | ||
Liabilities fair value | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Assets | ||
Money market funds | 0 | 0 |
Designated interest rate swaps | 25 | 64 |
Assets fair value | 1,754 | 1,927 |
Liabilities | ||
Liabilities fair value | 1,455 | 966 |
Designated as Hedging Instrument | ||
Assets | ||
Designated foreign currency hedge contracts | 1,633 | 1,645 |
Liabilities | ||
Designated foreign currency hedge contracts | 1,306 | 894 |
Designated as Hedging Instrument | Quoted Market Prices for Identical Assets (Level 1) | ||
Assets | ||
Designated foreign currency hedge contracts | 0 | 0 |
Liabilities | ||
Designated foreign currency hedge contracts | 0 | 0 |
Designated as Hedging Instrument | Significant Other Observable Inputs (Level 2) | ||
Assets | ||
Designated foreign currency hedge contracts | 1,633 | 1,645 |
Liabilities | ||
Designated foreign currency hedge contracts | 1,306 | 894 |
Not Designated as Hedging Instrument | ||
Assets | ||
Designated foreign currency hedge contracts | 96 | 218 |
Liabilities | ||
Designated foreign currency hedge contracts | 149 | 72 |
Not Designated as Hedging Instrument | Quoted Market Prices for Identical Assets (Level 1) | ||
Assets | ||
Designated foreign currency hedge contracts | 0 | 0 |
Liabilities | ||
Designated foreign currency hedge contracts | 0 | 0 |
Not Designated as Hedging Instrument | Significant Other Observable Inputs (Level 2) | ||
Assets | ||
Designated foreign currency hedge contracts | 96 | 218 |
Liabilities | ||
Designated foreign currency hedge contracts | $ 149 | $ 72 |
DERIVATIVES AND FAIR VALUE ME38
DERIVATIVES AND FAIR VALUE MEASUREMENTS (Narrative) (Details) | 3 Months Ended | ||
Jul. 01, 2017USD ($) | Apr. 01, 2017USD ($) | Dec. 21, 2012USD ($)swap | |
Foreign Exchange Contract | |||
Derivative [Line Items] | |||
Percentage of sales generated outside the US | 37.90% | ||
Maturity period for foreign currency contracts | 1 year | ||
Designated as Hedging Instrument | Foreign Exchange Contract | |||
Derivative [Line Items] | |||
Deferred income tax expense (benefit) | $ 0 | ||
Designated as Hedging Instrument | Foreign Exchange Contract | |||
Derivative [Line Items] | |||
Designated foreign currency hedge contracts outstanding | 67,400,000 | $ 68,400,000 | |
Designated as Hedging Instrument | Cash Flow Hedging | |||
Derivative [Line Items] | |||
Gain (loss) to be reclassified within the next twelve months | (200,000) | ||
Designated as Hedging Instrument | Interest Rate Swap [Member] | |||
Derivative [Line Items] | |||
Number of interest rate derivatives held | swap | 2 | ||
Notional amount of derivative | 50,000,000 | $ 250,000,000 | |
Not Designated as Hedging Instrument | Foreign Exchange Contract | |||
Derivative [Line Items] | |||
Amount of Gain/(Loss) Reclassified from AOCI into Earnings (Effective Portion) | 0 | ||
Non-designated foreign currency hedge contracts outstanding | 47,700,000 | $ 55,400,000 | |
Net revenues, COGS, and SG&A | Designated as Hedging Instrument | Cash Flow Hedging | |||
Derivative [Line Items] | |||
Amount of Gain/(Loss) Reclassified from AOCI into Earnings (Effective Portion) | $ 30,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jul. 01, 2017 | Jul. 02, 2016 | Apr. 01, 2017 | |
Income Tax Disclosure [Abstract] | |||
Provision (benefit) for income taxes | $ 3,115 | $ 288 | |
Reported tax rate | 13.40% | (2.90%) | |
Discrete tax provision | $ 400 | $ 1,400 | |
Unrecognized tax benefits | 3,400 | ||
Unrecognized tax benefits that would impact effective tax rate | 1,500 | ||
Decrease in unrecognized tax benefits is reasonably possible | 1,500 | ||
Unrecognized tax benefits, income tax penalties and interest accrued | $ 200 | $ 200 |
DEBT (Details)
DEBT (Details) | 3 Months Ended |
Jul. 01, 2017USD ($) | |
Credit Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum | |
Debt Instrument [Line Items] | |
Interest rate | 1.125% |
Credit Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum | |
Debt Instrument [Line Items] | |
Interest rate | 1.50% |
Term Loan [Member] | |
Debt Instrument [Line Items] | |
Face amount of debt | $ 475,000,000 |
Debt outstanding | 303,500,000 |
Principal repayments | 11,900,000 |
Revolving Credit Facility [Member] | |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | 100,000,000 |
Debt outstanding | $ 0 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |
Jul. 31, 2016 | Apr. 30, 2013 | Jul. 01, 2017 | Apr. 01, 2017 | |
Product Recall | ||||
Loss Contingencies [Line Items] | ||||
Damages claimed | $ 14,200,000 | |||
Product recall expense | 7,100,000 | |||
Product Recall | Minimum | ||||
Loss Contingencies [Line Items] | ||||
Estimate of possible loss | 3,400,000 | |||
Product Recall | Maximum | ||||
Loss Contingencies [Line Items] | ||||
Estimate of possible loss | 14,200,000 | |||
Product Recall | Customer Returns and Inventory Reserves [Member] | ||||
Loss Contingencies [Line Items] | ||||
Product recall expense | 3,700,000 | |||
Product Recall | Customer Claims [Member] | ||||
Loss Contingencies [Line Items] | ||||
Product recall expense | $ 3,400,000 | |||
Insurance settlements receivable | $ 2,900,000 | |||
Italian Employment Litigation [Member] | ||||
Loss Contingencies [Line Items] | ||||
Damages claimed | 4,700,000 | |||
Amount accrued | 0 | |||
SOLX Arbitration [Member] | ||||
Loss Contingencies [Line Items] | ||||
Damages claimed | $ 17,000,000 | |||
Amount accrued | $ 400,000 | |||
Payments under previous acquisition | $ 24,000,000 | |||
Contingent milestone payment | 3,000,000 | |||
Maximum future royalty payments | $ 14,000,000 | |||
Royalty Term | 10 years |
SEGMENT AND ENTERPRISE-WIDE I42
SEGMENT AND ENTERPRISE-WIDE INFORMATION (Details) $ in Thousands | 3 Months Ended | |
Jul. 01, 2017USD ($)unit | Jul. 02, 2016USD ($) | |
Segment Reporting [Abstract] | ||
Number of business units | unit | 4 | |
Segment Reporting Information [Line Items] | ||
Net Revenues, Before Foreign Exchange Impact | $ 213,950 | $ 211,802 |
Effect of exchange rates | (2,999) | (1,846) |
Net revenues (reported) | 210,951 | 209,956 |
Effect of exchange rates | (2,201) | (1,306) |
Restructuring and turnaround costs | (2,483) | (18,816) |
Deal amortization | (6,491) | (7,075) |
Impairment of assets | 0 | (1,315) |
Operating income (loss) | 16,611 | (7,881) |
Plasma [Member] | ||
Segment Reporting Information [Line Items] | ||
Net revenues (reported) | 101,507 | 97,649 |
Blood Center [Member] | ||
Segment Reporting Information [Line Items] | ||
Net revenues (reported) | 65,565 | 70,943 |
Cell Processing Management [Member] | ||
Segment Reporting Information [Line Items] | ||
Net revenues (reported) | 26,336 | 26,076 |
Hemostasis Management [Member] | ||
Segment Reporting Information [Line Items] | ||
Net revenues (reported) | 17,543 | 15,288 |
United States | ||
Segment Reporting Information [Line Items] | ||
Net revenues (reported) | 131,052 | 125,700 |
Japan | ||
Segment Reporting Information [Line Items] | ||
Net revenues (reported) | 14,916 | 14,964 |
Europe | ||
Segment Reporting Information [Line Items] | ||
Net revenues (reported) | 37,222 | 40,367 |
Asia | ||
Segment Reporting Information [Line Items] | ||
Net revenues (reported) | 25,940 | 26,992 |
Other | ||
Segment Reporting Information [Line Items] | ||
Net revenues (reported) | 1,821 | 1,933 |
Japan | ||
Segment Reporting Information [Line Items] | ||
Net Revenues, Before Foreign Exchange Impact | 15,232 | 14,566 |
EMEA | ||
Segment Reporting Information [Line Items] | ||
Net Revenues, Before Foreign Exchange Impact | 43,008 | 45,741 |
North America Plasma | ||
Segment Reporting Information [Line Items] | ||
Net Revenues, Before Foreign Exchange Impact | 77,536 | 73,475 |
All Other | ||
Segment Reporting Information [Line Items] | ||
Net Revenues, Before Foreign Exchange Impact | 78,174 | 78,020 |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Operating income (loss) | 67,097 | 66,770 |
Operating Segments | Japan | ||
Segment Reporting Information [Line Items] | ||
Operating income (loss) | 6,738 | 6,156 |
Operating Segments | EMEA | ||
Segment Reporting Information [Line Items] | ||
Operating income (loss) | 8,571 | 8,276 |
Operating Segments | North America Plasma | ||
Segment Reporting Information [Line Items] | ||
Operating income (loss) | 24,102 | 25,168 |
Operating Segments | All Other | ||
Segment Reporting Information [Line Items] | ||
Operating income (loss) | 27,686 | 27,170 |
Corporate operating expenses | ||
Segment Reporting Information [Line Items] | ||
Corporate operating expenses | $ (39,311) | $ (46,139) |
CAPITALIZATION OF SOFTWARE DE43
CAPITALIZATION OF SOFTWARE DEVELOPMENT COSTS (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jul. 01, 2017 | Jul. 02, 2016 | Apr. 01, 2017 | |
Research and Development [Abstract] | |||
Capitalized software development costs for ongoing initiatives | $ 3.1 | $ 3.7 | |
Software costs capitalized, net | 65.8 | $ 62.7 | |
Total costs capitalized related to in process software development initiatives | $ 15.8 | $ 12.7 | |
Capitalized software development costs placed into service | $ 2.5 |
ACCUMULATED OTHER COMPREHENSI44
ACCUMULATED OTHER COMPREHENSIVE LOSS (Details 1) $ in Thousands | 3 Months Ended |
Jul. 01, 2017USD ($) | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Balance as of April 1, 2017 | $ (32,873) |
Other comprehensive income (loss) before reclassifications | 3,599 |
Amounts reclassified from Accumulated Other Comprehensive Income (Loss) | 30 |
Other comprehensive income (loss) | 3,629 |
Balance as of July 1, 2017 | (29,244) |
Foreign Currency | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Balance as of April 1, 2017 | (29,835) |
Other comprehensive income (loss) before reclassifications | 3,845 |
Amounts reclassified from Accumulated Other Comprehensive Income (Loss) | 0 |
Other comprehensive income (loss) | 3,845 |
Balance as of July 1, 2017 | (25,990) |
Defined Benefit Plans | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Balance as of April 1, 2017 | (2,272) |
Other comprehensive income (loss) before reclassifications | 0 |
Amounts reclassified from Accumulated Other Comprehensive Income (Loss) | 0 |
Other comprehensive income (loss) | 0 |
Balance as of July 1, 2017 | (2,272) |
Net Unrealized Gain/Loss on Derivatives | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Balance as of April 1, 2017 | (766) |
Other comprehensive income (loss) before reclassifications | (246) |
Amounts reclassified from Accumulated Other Comprehensive Income (Loss) | 30 |
Other comprehensive income (loss) | (216) |
Balance as of July 1, 2017 | $ (982) |