Document and Entity Information
Document and Entity Information - Jul. 31, 2015 - shares | Total |
Document And Entity Information [Abstract] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Jul. 31, 2015 |
Document Fiscal Year Focus | 2,015 |
Document Fiscal Period Focus | Q3 |
Entity Registrant Name | COOPER COMPANIES INC |
Entity Central Index Key | 711,404 |
Current Fiscal Year End Date | --10-31 |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 48,613,895 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Income Statement [Abstract] | ||||
Net sales | $ 461,678 | $ 432,482 | $ 1,341,524 | $ 1,249,779 |
Cost of sales | 188,791 | 151,892 | 524,570 | 437,761 |
Gross profit | 272,887 | 280,590 | 816,954 | 812,018 |
Selling, general and administrative expense | 191,783 | 161,203 | 532,901 | 475,095 |
Research and development expense | 18,298 | 16,070 | 51,229 | 48,077 |
Amortization of intangibles | 12,495 | 6,752 | 38,406 | 21,735 |
Operating income | 50,311 | 96,565 | 194,418 | 267,111 |
Interest expense | 4,690 | 1,499 | 13,323 | 4,713 |
Other expense, net | 1,020 | 683 | 2,037 | 739 |
Income before income taxes | 44,601 | 94,383 | 179,058 | 261,659 |
(Benefit from) provision for income taxes | (642) | 5,711 | 10,929 | 21,087 |
Net income | 45,243 | 88,672 | 168,129 | 240,572 |
Less: Income attributable to noncontrolling interests | 292 | 605 | 1,285 | 1,502 |
Net income attributable to Cooper stockholders | $ 44,951 | $ 88,067 | $ 166,844 | $ 239,070 |
Earnings per share attributable to Cooper stockholders - basic | $ 0.92 | $ 1.83 | $ 3.45 | $ 4.98 |
Earnings per share attributable to Cooper stockholders - diluted | $ 0.91 | $ 1.80 | $ 3.39 | $ 4.89 |
Number of shares used to compute earnings per share: | ||||
Basic | 48,600 | 48,042 | 48,421 | 47,990 |
Diluted | 49,244 | 48,922 | 49,157 | 48,901 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 45,243 | $ 88,672 | $ 168,129 | $ 240,572 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment | 17,225 | (8,989) | (62,027) | 14,168 |
Change in value of derivative instruments, net of tax provision of $30 for the nine months ended July 31, 2015, and $144 and $541 for the three and nine months ended July 31, 2014, respectively | 0 | 225 | 47 | 846 |
Change in minimum pension liability, net of tax | 7 | 7 | 22 | 22 |
Other comprehensive income (loss) | 17,232 | (8,757) | (61,958) | 15,036 |
Comprehensive income | 62,475 | 79,915 | 106,171 | 255,608 |
Comprehensive loss (income) attributable to noncontrolling interests | 118 | (471) | (466) | (1,118) |
Comprehensive income attributable to Cooper stockholders | $ 62,593 | $ 79,444 | $ 105,705 | $ 254,490 |
Consolidated Statements of Com4
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Change in value of derivative instruments, tax | $ 0 | $ 144 | $ 30 | $ 541 |
Consolidated Condensed Balance
Consolidated Condensed Balance Sheets - USD ($) $ in Thousands | Jul. 31, 2015 | Oct. 31, 2014 |
Assets, Current [Abstract] | ||
Cash and cash equivalents | $ 17,005 | $ 25,222 |
Trade accounts receivable, net of allowance for doubtful accounts of $5,479 at July 31, 2015 and $6,025 at October 31, 2014 | 280,160 | 276,280 |
Inventories | 405,966 | 381,474 |
Deferred tax assets | 38,993 | 40,224 |
Prepaid expense and other current assets | 72,568 | 68,417 |
Total current assets | 814,692 | 791,617 |
Property, plant and equipment, at cost | 1,642,574 | 1,525,917 |
Less: accumulated depreciation and amortization | 667,698 | 588,592 |
Property, plant and equipment, net | 974,876 | 937,325 |
Goodwill | 2,189,153 | 2,220,921 |
Other intangibles, net | 402,286 | 453,605 |
Deferred tax assets | 8,602 | 15,732 |
Other assets | 33,073 | 39,140 |
Total assets | 4,422,682 | 4,458,340 |
Current liabilities: | ||
Short-term debt | 237,558 | 101,518 |
Accounts payable | 114,479 | 116,353 |
Employee compensation and benefits | 61,714 | 67,904 |
Other current liabilities | 115,836 | 156,407 |
Total current liabilities | 529,587 | 442,182 |
Long-term debt | 1,070,299 | 1,280,833 |
Deferred tax liabilities | 67,922 | 69,525 |
Accrued pension liability and other | 60,939 | 77,360 |
Total liabilities | $ 1,728,747 | $ 1,869,900 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, 10 cents par value, shares authorized: 1,000; zero shares issued or outstanding | $ 0 | $ 0 |
Common stock, 10 cents par value, shares authorized: 120,000; issued 51,537 at July 31, 2015 and 50,983 at October 31, 2014 | 5,154 | 5,099 |
Additional paid-in capital | 1,416,639 | 1,386,800 |
Accumulated other comprehensive loss | (168,140) | (106,182) |
Retained earnings | 1,742,761 | 1,578,823 |
Treasury stock at cost: 2,923 shares at July 31, 2015 and 2,840 shares at October 31, 2014 | (308,842) | (294,662) |
Total Cooper stockholders' equity | 2,687,572 | 2,569,878 |
Noncontrolling interests | 6,363 | 18,562 |
Stockholders’ equity | 2,693,935 | 2,588,440 |
Total liabilities and stockholders' equity | $ 4,422,682 | $ 4,458,340 |
Consolidated Condensed Balance6
Consolidated Condensed Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jul. 31, 2015 | Oct. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Trade accounts receivable, allowance for doubtful accounts | $ 5,479 | $ 6,025 |
Preferred stock, par value | $ 0.10 | $ 0.10 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.10 | $ 0.10 |
Common stock, shares authorized | 120,000,000 | 120,000,000 |
Common stock, shares, issued | 51,537,000 | 50,983,000 |
Treasury stock, shares | 2,923,000 | 2,840,000 |
Consolidated Condensed Statemen
Consolidated Condensed Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 31, 2015 | Jul. 31, 2014 | |
Cash flows from operating activities: | ||
Net income | $ 168,129 | $ 240,572 |
Depreciation and amortization | 141,298 | 95,647 |
Decrease in operating capital | (59,870) | (60,938) |
Other non-cash items | 36,892 | 27,486 |
Net cash provided by operating activities | 286,449 | 302,767 |
Cash flows from investing activities: | ||
Purchases of property, plant and equipment | (184,713) | (177,936) |
Net (payments for) proceeds from other investing activities | (1,178) | 754 |
Insurance proceeds received | 0 | 1,359 |
Net cash used in investing activities | (185,891) | (175,823) |
Cash flows from financing activities: | ||
Proceeds from long-term debt | 714,300 | 1,362,900 |
Repayments of long-term debt | (924,329) | (1,363,061) |
Net proceeds from (repayments of) short-term debt | 131,548 | (3,735) |
Repurchase of common stock | (15,996) | (50,000) |
Net (payments) proceeds related to share-based compensation awards | (5,696) | 6,880 |
Excess tax benefit from share-based compensation awards | 9,100 | 15,000 |
Purchase of shares from noncontrolling interests | (8,639) | 0 |
Dividends on common stock | (1,448) | (1,436) |
Distributions to noncontrolling interests | (816) | (1,678) |
Payment of contingent consideration | (2,906) | (3,820) |
Proceeds from construction allowance | 710 | 8,865 |
Net cash used in financing activities | (104,172) | (30,085) |
Effect of exchange rate changes on cash and cash equivalents | (4,603) | (466) |
Net (decrease) increase in cash and cash equivalents | (8,217) | 96,393 |
Cash and cash equivalents - beginning of period | 25,222 | 77,393 |
Cash and cash equivalents - end of period | 17,005 | 173,786 |
Supplemental disclosures of cash flow information: | ||
Litigation settlement charge | $ 17,000 | $ 0 |
General
General | 9 Months Ended |
Jul. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | General The Cooper Companies, Inc. (Cooper, we or the Company) is a global medical device company publicly traded on the NYSE Euronext (NYSE: COO). Cooper is dedicated to being A Quality of Life Company TM with a focus on delivering shareholder value. Cooper operates through our business units, CooperVision and CooperSurgical. • CooperVision develops, manufactures and markets a broad range of soft contact lenses for the worldwide vision correction market. • CooperSurgical develops, manufactures and markets medical devices and procedure solutions to improve healthcare delivery to women. The unaudited consolidated condensed financial statements presented in this report contain all adjustments necessary to present fairly Cooper’s consolidated condensed financial position at July 31, 2015 and October 31, 2014 , the consolidated results of its operations for the three and nine months ended July 31, 2015 and 2014 and its consolidated condensed cash flows for the nine months ended July 31, 2015 and 2014 . Most of these adjustments are normal and recurring. However, certain adjustments associated with acquisitions and insurance proceeds are of a nonrecurring nature. Readers should not assume that the results reported here either indicate or guarantee future performance. During interim periods, we follow the accounting policies described in our Annual Report on Form 10-K for the fiscal year ended October 31, 2014 . Please refer to this when reviewing this Quarterly Report on Form 10-Q. Management estimates and judgments are an integral part of financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). We believe that the critical accounting policies listed below address the more significant estimates required of Management when preparing our consolidated financial statements in accordance with GAAP. We consider an accounting estimate critical if changes in the estimate may have a material impact on our financial condition or results of operations. We believe that the accounting estimates employed are appropriate and resulting balances are reasonable; however, actual results could differ from the original estimates, requiring adjustment to these balances in future periods. The accounting policies that reflect our more significant estimates, judgments and assumptions and which we believe are the most critical to aid in fully understanding and evaluating our reported financial results are: • Revenue recognition • Net realizable value of inventory • Valuation of goodwill • Business combinations • Income taxes • Share-based compensation During the fiscal first nine months of 2015 , there were no significant changes in our estimates and critical accounting policies. Please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended October 31, 2014 , for a more complete discussion of our estimates and critical accounting policies. Accounting Pronouncements Issued Not Yet Adopted In April 2015, the FASB issued Accounting Standards Update (ASU) 2015-03, Interest - Imputation of Interest (Subtopic 835-30) Simplifying the Presentation of Debt Issuance Costs. The amendments in this update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. We do not anticipate the adoption of these amendments, which are effective for the Company for the fiscal year beginning on November 1, 2016, will have a material impact on our consolidated results of operations, financial condition or cash flows. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) . ASU 2014-09 requires revenue recognition to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price to performance obligations and recognizing the revenue upon satisfaction of performance obligations. The amendments in the ASU can be applied either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the update recognized at the date of the initial application along with additional disclosures. We are currently evaluating the impact of ASU 2014-09, which is effective for the Company in our fiscal year beginning on November 1, 2018. Accounting Pronouncements Recently Adopted On November 1, 2014, we adopted ASU 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit when a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU 2013-11 requires an unrecognized tax benefit to be presented in the financial statements as a reduction to a deferred tax asset when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. When a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available, or the entity does not intend to use the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The adoption of ASU 2013-11 did not have a significant impact on our consolidated financial statements. |
Acquisitions
Acquisitions | 9 Months Ended |
Jul. 31, 2015 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Sauflon Acquisition On August 6, 2014 , which we refer to as the Sauflon acquisition date, we completed the acquisition of the entire issued share capital of Sauflon Pharmaceuticals Limited (Sauflon), a privately-owned European manufacturer and distributor of soft contact lenses and solutions, that was based in Twickenham, United Kingdom. The fair value of the consideration transferred for Sauflon was approximately $1,073.2 million in cash, $1,063.1 million net of cash acquired, and approximately $58.0 million in the form of loan notes issued by Cooper. The loan notes were denominated in British pounds and redeemed and paid in our fiscal second quarter of 2015. The Sauflon acquisition was intended to accelerate the growth in sales of our single-use products by enabling a multi-tier, single-use strategy with a full suite of hydrogel and silicone hydrogel product offerings in the major product categories of sphere, toric and multifocal lenses. This acquisition was also intended to provide for enhanced relationships with key European retailers and opportunities for operational synergies. The acquisition was accounted for under the acquisition method of accounting, and the related assets acquired and liabilities assumed were recorded at fair value. While the acquisition was completed on August 6, 2014, we accounted for the acquisition as of August 1, 2014, and have included the operating results of Sauflon in our CooperVision business segment from that date. The impact of Sauflon's results of operations for the period August 1, 2014 through August 5, 2014 on our CooperVision business segment results of operations was de minimis. Similarly, we have determined that any difference in the fair value of assets acquired and liabilities assumed with respect to Sauflon between August 1, 2014 and August 6, 2014 was de minimis. The following table summarizes our consideration paid for Sauflon and the allocation of the purchase price to assets acquired and liabilities assumed. We repaid substantially all of the acquired debt concurrently with the acquisition with our available funds. Useful Lives of (In millions) Intangible Assets Fair Value Goodwill $ 856.2 Trademarks 10 years $ 7.2 Technology 10 years 138.2 Customer relationships 15 years 39.3 License and distribution rights and other 2 to 5 years 51.6 In-process research and development N/A 43.1 Purchased intangible assets $ 279.4 Cash and cash equivalents $ 10.1 Property, plant and equipment 83.9 Inventories 36.2 Trade accounts receivable 42.3 Other current assets 6.9 Debt (85.1 ) Accounts payable (23.6 ) Long term deferred tax liabilities (56.7 ) Other creditors and current liabilities (18.5 ) Net tangible liabilities $ (4.5 ) Total purchase consideration $ 1,131.1 Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the future economic benefits arising from the other assets acquired that could not be individually identified and separately recognized. The goodwill recorded as part of the acquisition of Sauflon was ascribed to our CooperVision business segment and is not amortized. This goodwill includes the following: ▪ The expected synergies and other benefits that we believe will result from combining the operations of Sauflon with the operations of CooperVision; ▪ Any intangible assets that did not qualify for separate recognition, as well as future, yet unidentified projects and products; and ▪ The value of the going-concern element of Sauflon's existing businesses (the higher rate of return on the assembled collection of net assets versus if CooperVision had acquired all of the net assets separately). Management determined fair values of the identifiable intangible assets through a combination of income approaches including relief from royalty, with-and-without, multi-period excess earnings and disaggregated methods. The valuation models were based on estimates of future operating projections of the acquired business and rights to sell products as well as judgments on the discount rates used and other variables. We determined the forecasts based on a number of factors, including our best estimate of near-term net sales expectations and long-term projections, which include review of internal and independent market analyses. The discount rate used was representative of the weighted average cost of capital. The unaudited pro forma financial results presented below for the three and nine months ended July 31, 2014 , include the effects of pro forma adjustments as if the acquisition occurred on November 1, 2012. The pro forma results were prepared using the acquisition method of accounting and combine the historical results of Cooper and Sauflon for the three and nine months ended July 31, 2014 , including the effects of the business combination, primarily amortization expense related to the fair value of identifiable intangible assets acquired, and interest expense associated with the financing obtained by Cooper in connection with the acquisition. The pro forma financial information is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of the earliest period presented, nor is it intended to be a projection of future results. Periods Ended July 31, 2014 (In millions, except per share amounts, unaudited, pro forma) Three Months Nine Months Revenue $ 481.8 $ 1,390.2 Net income attributable to Cooper stockholders $ 82.9 $ 226.6 Diluted earnings per share $ 1.69 $ 4.63 The pro forma results were adjusted to include pre-tax amortization of intangible assets totaling $7.4 million and $22.3 million for the three and nine months ended July 31, 2014 , respectively, and an additional $1.1 million and $3.4 million of interest expense for the three and nine months ended July 31, 2014 , respectively. |
Restructuring and Integration C
Restructuring and Integration Costs | 9 Months Ended |
Jul. 31, 2015 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Integration Costs | Restructuring and Integration Costs 2014 Sauflon Integration Plan During the fiscal fourth quarter of 2014, in connection with the Sauflon acquisition, our CooperVision business unit initiated restructuring and integration activities to optimize operational synergies of the combined companies. These activities include workforce reductions, consolidation of duplicative facilities and product rationalization. We estimate that the total restructuring costs under this plan will be $104.0 million . The $42.0 million increase over the prior estimate relates to additional manufacturing restructuring activities, primarily related to our hydrogel contact lenses, based on our review of products, materials and manufacturing processes of Sauflon. We expect to complete the activities related to operating expenses in our fiscal first quarter of 2016, and to incur costs related to the manufacturing activities through the end of fiscal 2016. These costs include approximately $80.0 million associated with assets, including product rationalization and related equipment disposals and accelerated depreciation, about $18.0 million associated with employee termination costs and about $6.0 million associated with facility lease termination costs. In the three and nine months ended July 31, 2015 , we recorded in cost of sales $12.4 million and $26.2 million of expense, respectively, arising from production-related asset disposals and accelerated depreciation on equipment, primarily related to our hydrogel lenses, based on our review of products, materials and manufacturing processes of Sauflon. In the three months ended July 31, 2015 , we recorded in cost of sales $0.3 million of employee termination costs. In the three and nine months ended July 31, 2015 , we reduced in selling, general and administrative expense, the accrued employee termination costs by $2.3 million and $6.7 million , respectively, based on current estimates of the expected costs and the results of voluntary terminations; and we recorded $0.3 million of expense for lease termination costs. In the three and nine months ended July 31, 2015 , we recorded in research and development expense $0.2 million and $0.5 million of employee termination costs, respectively. In addition, CooperVision incurred $10.7 million and $24.7 million of integration costs in the three and nine months ended July 31, 2015 , respectively, included in operating expenses. In fiscal 2014, we recorded restructuring charges of $20.3 million for employee termination costs; $15.3 million for product rationalization, including inventory write-offs and production-related asset disposals, primarily related to our Avaira Toric contact lenses, based on our review of products, materials and manufacturing processes of Sauflon; and $0.5 million of lease termination costs for facility closures. The product rationalization costs were recorded in cost of sales. Of the employee termination costs, $19.7 million were recorded in selling, general and administrative expense and $0.6 million in research and development expense. The lease termination costs and other related costs were recorded in selling, general and administrative expense. In addition, CooperVision incurred $2.8 million of integration costs included in operating expenses. A summary of the total restructuring costs by major component recognized for the fiscal year ended October 31, 2014, and nine months ended July 31, 2015 , is as follows: (In millions) Employee-related Facilities-related Product Rationalization Total Amounts incurred in: Year ended October 31, 2014 $ 20.3 $ 0.5 $ 15.3 $ 36.1 Nine months ended July 31, 2015 (5.9 ) 0.3 26.2 20.6 Cumulative amounts incurred as of July 31, 2015 $ 14.4 $ 0.8 $ 41.5 $ 56.7 The following table summarizes the restructuring activities by major component for the fiscal year ended October 31, 2014 and the nine months ended July 31, 2015 : (In millions) Employee-related Facilities-related Product Rationalization Total Additions during fiscal 2014 $ 20.3 $ 0.5 $ 15.3 $ 36.1 Payments during the fiscal year (0.4 ) — — (0.4 ) Non-cash adjustments (b) — — (15.3 ) (15.3 ) Balance at October 31, 2014 19.9 0.5 — 20.4 Additions (reductions) during the nine months ended July 31, 2015 (5.9 ) 0.3 26.2 20.6 Payments during the nine months ended July 31, 2015 (5.3 ) (0.1 ) — (5.4 ) Non-cash adjustments (a) (b) 0.2 (0.1 ) (26.2 ) (26.1 ) Balance as of July 31, 2015 $ 8.9 $ 0.6 $ — $ 9.5 (a) Non-cash adjustments for employee-related and facilities-related costs represent currency translation adjustment. (b) Non-cash adjustments for product rationalization represent equipment disposals, inventory write-offs and accelerated depreciation. |
Inventories
Inventories | 9 Months Ended |
Jul. 31, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories (In thousands) July 31, 2015 October 31, 2014 Raw materials $ 78,051 $ 76,870 Work-in-process 14,471 14,344 Finished goods 313,444 290,260 $ 405,966 $ 381,474 Inventories are stated at the lower of cost or market. Cost is computed using standard cost that approximates actual cost, on a first-in, first-out basis. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Jul. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Goodwill (In thousands) CooperVision CooperSurgical Total Balance as of October 31, 2013 $ 1,048,478 $ 339,133 $ 1,387,611 Net additions during the year ended October 31, 2014 857,146 25,543 882,689 Translation (44,063 ) (5,316 ) (49,379 ) Balance as of October 31, 2014 1,861,561 359,360 2,220,921 Net reductions during the nine-month period ended July 31, 2015 (1,189 ) (8 ) (1,197 ) Translation (23,306 ) (7,265 ) (30,571 ) Balance as of July 31, 2015 $ 1,837,066 $ 352,087 $ 2,189,153 We performed our annual impairment assessment in our fiscal third quarter of 2015, and our analysis indicated that we had no impairment of goodwill. We performed our annual impairment assessment in our fiscal third quarter of 2014, and our analysis indicated that we had no impairment of goodwill. We evaluate goodwill for impairment annually during the fiscal third quarter and when an event occurs or circumstances change such that it is reasonably possible that impairment may exist. We account for goodwill and evaluate our goodwill balances and test them for impairment in accordance with related accounting standards. In fiscal 2015 and 2014, we performed a qualitative assessment to test each reporting unit's goodwill for impairment. Qualitative factors considered in this assessment include industry and market considerations, overall financial performance and other relevant events and factors affecting each reporting unit. Based on our qualitative assessment, if we determine that the fair value of a reporting unit is more likely than not to be less than its carrying amount, the two step impairment test will be performed. Initially, we compare the book value of net assets to the fair value of each reporting unit that has goodwill assigned to it. If the fair value is determined to be less than the book value, a second step is performed to compute the amount of the impairment. A reporting unit is the level of reporting at which goodwill is tested for impairment. Our reporting units are the same as our business segments - CooperVision and CooperSurgical - reflecting the way that we manage our business. Goodwill impairment analysis and measurement is a process that requires significant judgment. If our common stock price trades below book value per share, there are changes in market conditions or a future downturn in our business, or a future annual goodwill impairment test indicates an impairment of our goodwill, we may have to recognize a non-cash impairment of goodwill that could be material and could adversely affect our results of operations in the period recognized and also adversely affect our total assets, stockholders' equity and financial condition. Other Intangible Assets As of July 31, 2015 As of October 31, 2014 (In thousands) Gross Carrying Amount Accumulated Amortization & Translation Gross Carrying Amount Accumulated Amortization & Translation Trademarks $ 20,546 $ 3,938 $ 21,281 $ 2,937 Technology 320,447 109,617 326,620 93,780 Customer relationships 226,588 100,463 233,246 90,704 License and distribution rights and other 72,228 23,505 73,479 13,600 639,809 $ 237,523 654,626 $ 201,021 Less accumulated amortization and translation 237,523 201,021 Other intangible assets, net $ 402,286 $ 453,605 We estimate that amortization expense for our existing other intangible assets at July 31, 2015 , will be $50.9 million in fiscal 2015, $48.5 million in fiscal 2016, $45.2 million in fiscal 2017, $43.3 million in fiscal 2018 and $40.5 million in fiscal 2019. |
Debt
Debt | 9 Months Ended |
Jul. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt | Debt (In thousands) July 31, 2015 October 31, 2014 Short-term: Loan notes issued for Sauflon acquisition $ — $ 55,074 Overdraft and other credit facilities 237,558 46,444 $ 237,558 $ 101,518 Long-term: Credit agreement $ 69,800 $ 279,500 Term loans 1,000,000 1,000,000 Other 499 1,333 $ 1,070,299 $ 1,280,833 Credit Agreement On May 31, 2012, Cooper entered into an amendment to our Credit Agreement, dated as of January 12, 2011 , by and among the Company, CooperVision International Holding Company, LP, the lenders party thereto and KeyBank National Association, as administrative agent. The Credit Agreement, as amended, provides for a multicurrency revolving credit facility in an aggregate commitment amount of $1.0 billion and the aggregate commitment amount under the revolving facility may be increased, upon written request by Cooper, by $500.0 million . The amended Credit Agreement has a termination date of May 31, 2017 . In connection with the Sauflon acquisition, on June 30, 2014, we entered into an amendment (Credit Agreement Amendment) to the Credit Agreement, dated as of January 12, 2011 , as amended, by and among (i) the Company, (ii) CooperVision International Holding Company, LP, an indirect subsidiary of the Company, (iii) the lenders from time to time party thereto and (iv) Keybank National Association, as administrative agent. The Credit Agreement Amendment modifies certain provisions of the Credit Agreement to, among other things, amend certain restrictive covenants and related definitions to allow for certain indebtedness, investments, guaranty obligations, acquisitions, intercompany loans, capital distributions and dispositions of assets made or to be made in connection with the acquisition. The commitment fee rate ranges between 0.100% and 0.275% of the unused portion of the revolving facility based on a pricing grid tied to our Total Leverage Ratio (as defined below and in the Credit Agreement). The applicable margin rates on loans outstanding under the Credit Agreement will bear interest based, at our option, on either the base rate or the adjusted Eurodollar rate (currently referred to as LIBOR) or adjusted foreign currency rate (each as defined in the amended Credit Agreement), plus an applicable margin of between 0.00% and 0.75% in respect of base rate loans and between 1.00% and 1.75% in respect of adjusted Eurodollar rate or adjusted foreign currency rate loans, in each case in accordance with a pricing grid tied to our Total Leverage Ratio, as defined in the Credit Agreement. In addition to the annual commitment fee, we are also required to pay certain letter of credit and related fronting fees and other administrative fees pursuant to the terms of the Credit Agreement. The Credit Agreement is not secured by any of the Company's, or any of its subsidiaries’, assets. All obligations under the Credit Agreement will be guaranteed by each of our existing and future direct and indirect material domestic subsidiaries. Pursuant to the terms of the Credit Agreement and the term loans discussed below, we are also required to maintain specified financial ratios: • The ratio of Consolidated Proforma EBITDA to Consolidated Interest Expense (as defined, Interest Coverage Ratio) be at least 3.00 to 1.00 at all times. • The ratio of Consolidated Funded Indebtedness to Consolidated Proforma EBITDA (as defined, Total Leverage Ratio) be no higher than 3.75 to 1.00. At July 31, 2015 , we were in compliance with the Interest Coverage Ratio at 33.87 to 1.00 and the Total Leverage Ratio at 2.33 to 1.00. At July 31, 2015 , we had $930.0 million available under the Credit Agreement. Uncommitted Revolving Lines of Credit on March 24, 2015 On March 24, 2015 , we entered into uncommitted line of credit agreements with TD Bank, N.A. and Santander Bank, N.A. These lines of credit have a termination date of March 24, 2016 , and each provide revolving loan amounts to Cooper of up to $100.0 million , at the lender's option, with maturity dates of up to ninety days from the loan origination date. Amounts outstanding under these agreements will bear interest at a rate equal to LIBOR for the period plus, 0.90% , payable in arrears on the last day of the period, as defined in the agreements. At July 31, 2015 , we had $200.0 million outstanding under these agreements. $300.0 million Term Loan on September 12, 2013 On September 12, 2013 , the Company entered into a five -year, $300.0 million , senior unsecured term loan agreement by and among the Company; the lenders party thereto and KeyBank National Association, as administrative agent. This syndicated credit facility, as subsequently amended, will mature on September 12, 2018 , and will be subject to amortization of principal of 5% per annum payable quarterly beginning October 31, 2016 , with the balance payable at maturity. Amounts outstanding under this term loan agreement will bear interest, at the Company's option, at either the base rate, which is a rate per annum equal to the greatest of (a) KeyBank's prime rate , (b) 0.5% in excess of the federal funds effective rate and (c) 1% in excess of the adjusted Eurodollar rate (currently referred to as LIBOR) for a one-month interest period on such day, or the adjusted Eurodollar rate, plus, in each case, an applicable margin. The applicable margins will be determined quarterly by reference to a grid based upon the Company's Total Leverage Ratio, as defined in the term loan agreement, and consistent with the revolving Credit Agreement discussed above. This term loan agreement contains customary restrictive covenants, as well as financial covenants that require the Company to maintain a certain Total Leverage Ratio and Interest Coverage Ratio, each as defined in the agreement, consistent with the revolving Credit Agreement discussed above. The agreement also contains customary events of default, the occurrence of which would permit the Administrative Agent to declare the principal, accrued interest and other obligations of the Company under the agreement to be immediately due and payable. In connection with the Sauflon acquisition, on June 30, 2014, we entered into an amendment to this term loan agreement, dated as of September 12, 2013 , by and among (i) the Company, (ii) the lenders from time to time party thereto and (iii) KeyBank National Association, as administrative agent. This term loan amendment modifies certain provisions of the term loan agreement to, among other things, amend certain restrictive covenants and related definitions to allow for certain indebtedness, investments, guaranty obligations, acquisitions, intercompany loans, capital distributions and dispositions of assets made or to be made in connection with the acquisition. On August 4, 2014, we entered into Amendment No. 2 to this term loan agreement, dated as of September 12, 2013 , as amended by Amendment No. 1 dated as of June 30, 2014, by and among the Company, the lenders party thereto and KeyBank National Association, as administrative agent. The term loan amendment modifies certain provisions of the term loan agreement to remove the call premium related to prepayments and/or refinancing of the term loan agreement, effective August 4, 2014. At July 31, 2015 , we had $300.0 million outstanding under the Term Loan. $700.0 million Term Loan on August 4, 2014 On August 4, 2014 , we entered into a three -year, $700.0 million , senior unsecured term loan agreement by and among the Company, the lenders party thereto and KeyBank National Association as administrative agent. This syndicated credit facility will mature and the balance is payable on August 4, 2017 . There is no amortization of principal and we may prepay loan balances from time to time, in whole or in part, without premium or penalty. Amounts outstanding under this term loan agreement will bear interest, at the Company’s option, at either the base rate, which is a rate per annum equal to the greatest of (a) KeyBank’s prime rate, (b) 0.5% in excess of the federal funds effective rate and (c) 1% in excess of the adjusted Eurodollar rate (currently referred to as LIBOR) for a one-month interest period on such day, or the adjusted Eurodollar rate, plus, in each case, an applicable margin. The applicable margins will be determined quarterly by reference to a grid based upon the Company’s Total Leverage Ratio, as defined in the term loan agreement and consistent with the revolving Credit Agreement discussed above. This term loan agreement contains customary restrictive covenants, as well as financial covenants that require the Company to maintain a certain Total Leverage Ratio and Interest Coverage Ratio, each as defined in the agreement, and consistent with the revolving Credit Agreement as discussed above. This term loan agreement also contains customary events of default, the occurrence of which would permit the Administrative Agent to declare the principal, accrued interest and other obligations of the Company under the agreement to be immediately due and payable. In August 2014, we utilized this facility to fund the acquisition of Sauflon, as well as to provide working capital and for general corporate purposes. At July 31, 2015 , we had $700.0 million outstanding under this term loan. |
Income Taxes
Income Taxes | 9 Months Ended |
Jul. 31, 2015 | |
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract] | |
Income Taxes | Income Taxes Our effective tax rate (ETR) (provision for income taxes divided by pretax income) for the fiscal first nine months of 2015 was 6.1% . Our year-to-date results reflect the projected fiscal year ETR, plus any discrete items. The ETR used to record the provision for income taxes for the fiscal first nine months of 2014 was 8.1% . The ETR is below the United States statutory rate as a majority of our taxable income is earned in foreign jurisdictions with lower tax rates. We recognize the benefit from a tax position only if it is more likely than not that the position would be sustained upon audit based solely on the technical merits of the tax position. At November 1, 2014, Cooper had unrecognized tax benefits of which, if recognized, $32.0 million would impact our ETR. For the nine -month period ended July 31, 2015 , there were no material changes to the total amount of unrecognized tax benefits. Interest and penalties of $4.1 million have been reflected as a component of the total liability at November 1, 2014. It is our policy to recognize the items of interest and penalties directly related to income taxes as additional income tax expense. Included in the balance of unrecognized tax benefits at November 1, 2014, is $10.2 million related to tax positions for which it is reasonably possible that the total amounts could significantly change during the next twelve months. This amount represents a decrease in unrecognized tax benefits related to expiring statutes in various jurisdictions worldwide and relates primarily to transfer pricing matters. At July 31, 2015 , the tax years for which Cooper remains subject to United States Federal income tax assessment upon examination are 2011 through 2014. Cooper remains subject to income tax examinations in other significant tax jurisdictions including the United Kingdom, Japan, France and Australia for the tax years 2011 through 2014. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Jul. 31, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Periods Ended July 31, Three Months Nine Months (In thousands, except per share amounts) 2015 2014 2015 2014 Net income attributable to Cooper stockholders $ 44,951 $ 88,067 $ 166,844 $ 239,070 Basic: Weighted average common shares 48,600 48,042 48,421 47,990 Basic earnings per common share attributable to Cooper stockholders $ 0.92 $ 1.83 $ 3.45 $ 4.98 Diluted: Weighted average common shares 48,600 48,042 48,421 47,990 Effect of potential dilutive common shares 644 880 736 911 Diluted weighted average common shares 49,244 48,922 49,157 48,901 Diluted earnings per common share attributable to Cooper stockholders $ 0.91 $ 1.80 $ 3.39 $ 4.89 The following table sets forth stock options to purchase Cooper’s common stock and restricted stock units that were not included in the diluted earnings per share calculation because their effect would have been antidilutive for the periods presented: Periods Ended July 31, Three Months Nine Months (In thousands, except exercise prices) 2015 2014 2015 2014 Numbers of stock option shares excluded 49 138 123 138 Range of exercise prices $ 162.28 $ 119.89 $ 162.28 $ 119.89 Numbers of restricted stock units excluded 1 — 5 1 |
Share-Based Compensation Plans
Share-Based Compensation Plans | 9 Months Ended |
Jul. 31, 2015 | |
Share-based Compensation [Abstract] | |
Share-Based Compensation Plans | Share-Based Compensation Plans Cooper has several share-based compensation plans that are described in the Company’s Annual Report on Form 10‑K for the fiscal year ended October 31, 2014 . The compensation expense and related income tax benefit recognized in our consolidated condensed financial statements for share-based awards were as follows: Periods Ended July 31, Three Months Nine Months (In millions) 2015 2014 2015 2014 Selling, general and administrative expense $ 6.2 $ 6.4 $ 22.1 $ 26.2 Cost of sales 0.6 0.5 2.0 1.8 Research and development expense 0.2 0.5 0.7 1.5 Total share-based compensation expense $ 7.0 $ 7.4 $ 24.8 $ 29.5 Related income tax benefit $ 2.2 $ 2.3 $ 7.8 $ 9.6 We capitalized share-based compensation expense as part of the cost of inventory in the amounts of $0.6 million and $2.0 million during the three and nine months ended July 31, 2015 , respectively, and $0.5 million and $1.8 million during the three and nine months ended July 31, 2014 , respectively. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Jul. 31, 2015 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Analysis of Changes in Accumulated Other Comprehensive Income (Loss): (In thousands) Foreign Currency Translation Adjustment Change in Value of Derivative Instruments Minimum Pension Liability Total Balance at October 31, 2014 $ (92,355 ) $ (47 ) $ (13,780 ) $ (106,182 ) Gross change in value for the period (62,027 ) — 22 (62,005 ) Reclassification adjustments for loss realized in net income — 77 — 77 Tax effect for the period — (30 ) — (30 ) Balance at July 31, 2015 $ (154,382 ) $ — $ (13,758 ) $ (168,140 ) Balance at October 31, 2013 $ (4,592 ) $ (1,033 ) $ (10,137 ) $ (15,762 ) Gross change in value for the period 14,168 (58 ) 22 14,132 Reclassification adjustments for loss realized in net income — 1,445 — 1,445 Tax effect for the period — (541 ) — (541 ) Balance at July 31, 2014 $ 9,576 $ (187 ) $ (10,115 ) $ (726 ) Share Repurchases In December 2011, our Board of Directors authorized the 2012 Share Repurchase Program and subsequently amended the total repurchase authorization to $500.0 million of the Company’s common stock. This program has no expiration date and may be discontinued at any time. Purchases under the 2012 Share Repurchase Program are subject to a review of the circumstances in place at the time and may be made from time to time as permitted by securities laws and other legal requirements. No shares were repurchased during the fiscal third quarter of 2015 and 2014. In the fiscal first quarter of 2015, we repurchased 100 thousand shares of the Company’s common stock for $16.0 million , at an average purchase price of $159.96 per share. In the fiscal first quarter of 2014, we repurchased 396 thousand shares for $50.0 million , at an average purchase price of $126.21 per share. At July 31, 2015 , approximately $169.7 million remains authorized for repurchase under the program. Dividends We paid a semiannual dividend of approximately $1.4 million or 3 cents per share on February 9, 2015, to stockholders of record on January 23, 2015 . We paid another semiannual dividend of approximately $1.5 million or 3 cents per share on August 6, 2015, to stockholders of record on July 24, 2015 . |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Jul. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements At July 31, 2015 and October 31, 2014 , the carrying value of cash and cash equivalents, accounts receivable, prepaid expense and other current assets, lines of credit, accounts payable and other current liabilities approximate fair value due to the short-term nature of such instruments and the ability to obtain financing on similar terms. Assets and liabilities are measured and reported at fair value per related accounting standards that define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value. An asset’s or liability’s level is based on the lowest level of input that is significant to the fair value measurement. Assets and liabilities carried at fair value are valued and disclosed in one of the following three levels of the valuation hierarchy: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs reflecting the reporting entity’s own assumptions. We believe that the balances of our revolving debt and term loans approximated their fair values as of July 31, 2015 and October 31, 2014 and are categorized as Level 2 of the fair value hierarchy. The Company has derivative assets and liabilities that may include interest rate swaps, cross currency swaps and foreign currency forward contracts. The impact of the counterparty’s creditworthiness when in an asset position and Cooper’s creditworthiness when in a liability position has also been factored into the fair value measurement of the derivative instruments. Both the counterparty and Cooper are expected to continue to perform under the contractual terms of the instruments. We may use interest rate swaps to maintain our desired mix of fixed-rate and variable-rate debt. The swaps exchange fixed and variable rate payments without exchanging the notional principal amount of the debt. We generally have elected to use the income approach to value the derivatives using observable Level 2 market expectations at the measurement date and standard valuation techniques to convert future amounts to a single present amount assuming that participants are motivated but not compelled to transact. Level 2 inputs are limited to quoted prices for similar assets or liabilities in active markets, specifically Eurodollar futures contracts up to three years, and inputs other than quoted prices that are observable for the asset or liability - specifically LIBOR cash and swap rates and credit risk at commonly quoted intervals. Mid-market pricing may be used as a practical expedient for fair value measurements. We may use foreign exchange forward contracts to minimize, to the extent reasonable and practical, our exposure to the impact of foreign currency fluctuations. We have elected to use the income approach to value the derivatives using observable Level 2 market expectations at the measurement date and standard valuation techniques to convert future amounts to a single present amount assuming that participants are motivated but not compelled to transact. Level 2 inputs for the valuations are limited to quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability - specifically LIBOR cash rates, credit risk at commonly quoted intervals, foreign exchange spot rates and forward points. Mid-market pricing is used as a practical expedient for fair value measurements. The following table sets forth our financial assets and liabilities that were measured at fair value on a recurring basis using Level 2 inputs during the fiscal first nine months of 2015 , within the fair value hierarchy at July 31, 2015 , and fiscal year 2014 , within the fair value hierarchy at October 31, 2014 : (In millions) July 31, 2015 October 31, 2014 Assets: Foreign exchange contracts $ 0.3 $ 0.6 Liabilities: Interest rate swaps $ — 0.1 Foreign exchange contracts 0.6 3.3 $ 0.6 $ 3.4 |
Employee Benefits
Employee Benefits | 9 Months Ended |
Jul. 31, 2015 | |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |
Employee Benefits | Employee Benefits Cooper’s Retirement Income Plan (Plan), a defined benefit plan, covers substantially all full-time United States employees. Our contributions are designed to fund normal cost on a current basis and to fund the estimated prior service cost of benefit improvements. The unit credit actuarial cost method is used to determine the annual cost. Cooper pays the entire cost of the Plan and funds such costs as they accrue. Virtually all of the assets of the Plan are comprised of equities and participation in equity and fixed income funds. Our results of operations for the three and nine months ended July 31, 2015 and 2014 reflect the following components of net periodic pension costs: Periods Ended July 31, Three Months Nine Months (In thousands) 2015 2014 2015 2014 Service cost $ 2,037 $ 1,768 $ 6,110 $ 5,305 Interest cost 1,063 988 3,191 2,963 Expected returns on assets (1,512 ) (1,237 ) (4,538 ) (3,712 ) Amortization of prior service cost 1 6 3 18 Recognized net actuarial loss 246 154 740 462 Net periodic pension cost $ 1,835 $ 1,679 $ 5,506 $ 5,036 Cooper contributed $2.5 million and $5.0 million to the Plan in the three and nine months ended July 31, 2015, respectively, and expects to contribute an additional $5.0 million during fiscal 2015. We contributed $1.4 million and $5.8 million to the Plan in the three and nine months ended July 31, 2014 . The expected rate of return on plan assets for determining net periodic pension cost is 8% . |
Contingencies
Contingencies | 9 Months Ended |
Jul. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies On or about November 11, 2014, Johnson & Johnson Vision Care (JJVC) filed an action in the district court of Dusseldorf, Germany, against CooperVision GmbH and CooperVision, Inc. (collectively “CooperVision” or “we”) for patent infringement. In the action, JJVC alleged that certain CooperVision products infringe JJVC’s European Patent No. EP 1 754 728 B1, and was seeking damages and to enjoin these products from selling in Germany. We were challenging the validity of the patent before the European Patent Office. In July 2015, CooperVision made a one-time lump sum payment to JJVC of $17.0 million to settle our existing patent disputes. As a result of the settlement, we withdrew our opposition to the JJVC patent filed before the European Patent Office, and JJVC withdrew its complaint of infringement pending before the district court of Dusseldorf, Germany. The settlement included worldwide, non-exclusive, perpetual and royalty-free cross-licenses between the parties to certain patents including the JJVC patent referenced above. The settlement also included reciprocal covenants not to sue on those patents which were not licensed with respect to each party’s current, core commercialized product offerings, including all silicone hydrogel lenses. Neither party admitted any liability as part of the settlement. Since March 2015, over 50 putative class action complaints were filed by contact lens consumers alleging that contact lens manufacturers, in conjunction with their respective Unilateral Pricing Policy (UPP), conspired to reach agreements between each other and certain distributors and retailers regarding the prices at which certain contact lenses could be sold to consumers. The plaintiffs are seeking damages against CooperVision, Inc., other contact lens manufacturers, distributors and retailers, in various courts around the United States. In June 2015, all of the class action cases were consolidated and transferred to the United States District Court for the Middle District of Florida. CooperVision denies the allegations and intends to defend the actions vigorously. We are not in a position to assess whether any loss or adverse effect on our financial condition is probable or remote or to estimate the range of potential loss, if any. |
Business Segment Information
Business Segment Information | 9 Months Ended |
Jul. 31, 2015 | |
Segment Reporting [Abstract] | |
Business Segment Information | Business Segment Information Cooper uses operating income, as presented in our financial reports, as the primary measure of segment profitability. We do not allocate costs from corporate functions to segment operating income. Items below operating income are not considered when measuring the profitability of a segment. We use the same accounting policies to generate segment results as we do for our consolidated results. Identifiable assets are those used in continuing operations except cash and cash equivalents, which we include as corporate assets. Long-lived assets are property, plant and equipment. Segment information: Periods Ended July 31, Three Months Nine Months (In thousands) 2015 2014 2015 2014 CooperVision net sales by category: Toric lens $ 114,227 $ 112,330 $ 329,784 $ 318,290 Multifocal lens 42,620 38,393 122,985 107,627 Single-use sphere lens 93,730 73,834 263,037 214,310 Non single-use sphere and other 134,893 125,343 398,599 367,058 Total CooperVision net sales 385,470 349,900 1,114,405 1,007,285 CooperSurgical net sales 76,208 82,582 227,119 242,494 Total net sales $ 461,678 $ 432,482 $ 1,341,524 $ 1,249,779 Operating income (loss): CooperVision $ 46,359 $ 88,386 $ 187,233 $ 255,150 CooperSurgical 15,043 18,419 42,451 50,673 Corporate (11,091 ) (10,240 ) (35,266 ) (38,712 ) Total operating income 50,311 96,565 194,418 267,111 Interest expense 4,690 1,499 13,323 4,713 Other expense, net 1,020 683 2,037 739 Income before income taxes $ 44,601 $ 94,383 $ 179,058 $ 261,659 (In thousands) July 31, 2015 October 31, 2014 Identifiable assets: CooperVision $ 3,735,893 $ 3,699,614 CooperSurgical 628,800 646,200 Corporate 57,989 112,526 Total $ 4,422,682 $ 4,458,340 Geographic information: Periods Ended July 31, Three Months Nine Months (In thousands) 2015 2014 2015 2014 Net sales to external customers by country of domicile: United States $ 203,019 $ 196,032 $ 604,281 $ 573,282 Europe 173,829 145,543 487,579 406,007 Rest of world 84,830 90,907 249,664 270,490 Total $ 461,678 $ 432,482 $ 1,341,524 $ 1,249,779 (In thousands) July 31, 2015 October 31, 2014 Long-lived assets by country of domicile: United States $ 497,050 $ 499,195 Europe 418,700 406,433 Rest of world 59,126 31,697 Total $ 974,876 $ 937,325 |
General (Policies)
General (Policies) | 9 Months Ended |
Jul. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Accounting Pronouncements Issued Not Yet Adopted and Accounting Pronouncements Recently Adopted | Accounting Pronouncements Issued Not Yet Adopted In April 2015, the FASB issued Accounting Standards Update (ASU) 2015-03, Interest - Imputation of Interest (Subtopic 835-30) Simplifying the Presentation of Debt Issuance Costs. The amendments in this update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. We do not anticipate the adoption of these amendments, which are effective for the Company for the fiscal year beginning on November 1, 2016, will have a material impact on our consolidated results of operations, financial condition or cash flows. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) . ASU 2014-09 requires revenue recognition to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price to performance obligations and recognizing the revenue upon satisfaction of performance obligations. The amendments in the ASU can be applied either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the update recognized at the date of the initial application along with additional disclosures. We are currently evaluating the impact of ASU 2014-09, which is effective for the Company in our fiscal year beginning on November 1, 2018. Accounting Pronouncements Recently Adopted On November 1, 2014, we adopted ASU 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit when a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU 2013-11 requires an unrecognized tax benefit to be presented in the financial statements as a reduction to a deferred tax asset when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. When a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available, or the entity does not intend to use the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The adoption of ASU 2013-11 did not have a significant impact on our consolidated financial statements. |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Business Combinations [Abstract] | |
Schedule of Preliminary Purchase Price Allocation | The following table summarizes our consideration paid for Sauflon and the allocation of the purchase price to assets acquired and liabilities assumed. We repaid substantially all of the acquired debt concurrently with the acquisition with our available funds. Useful Lives of (In millions) Intangible Assets Fair Value Goodwill $ 856.2 Trademarks 10 years $ 7.2 Technology 10 years 138.2 Customer relationships 15 years 39.3 License and distribution rights and other 2 to 5 years 51.6 In-process research and development N/A 43.1 Purchased intangible assets $ 279.4 Cash and cash equivalents $ 10.1 Property, plant and equipment 83.9 Inventories 36.2 Trade accounts receivable 42.3 Other current assets 6.9 Debt (85.1 ) Accounts payable (23.6 ) Long term deferred tax liabilities (56.7 ) Other creditors and current liabilities (18.5 ) Net tangible liabilities $ (4.5 ) Total purchase consideration $ 1,131.1 |
Schedule of Pro Forma Financial Information | The pro forma financial information is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of the earliest period presented, nor is it intended to be a projection of future results. Periods Ended July 31, 2014 (In millions, except per share amounts, unaudited, pro forma) Three Months Nine Months Revenue $ 481.8 $ 1,390.2 Net income attributable to Cooper stockholders $ 82.9 $ 226.6 Diluted earnings per share $ 1.69 $ 4.63 |
Restructuring and Integration24
Restructuring and Integration Costs (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Costs | A summary of the total restructuring costs by major component recognized for the fiscal year ended October 31, 2014, and nine months ended July 31, 2015 , is as follows: (In millions) Employee-related Facilities-related Product Rationalization Total Amounts incurred in: Year ended October 31, 2014 $ 20.3 $ 0.5 $ 15.3 $ 36.1 Nine months ended July 31, 2015 (5.9 ) 0.3 26.2 20.6 Cumulative amounts incurred as of July 31, 2015 $ 14.4 $ 0.8 $ 41.5 $ 56.7 The following table summarizes the restructuring activities by major component for the fiscal year ended October 31, 2014 and the nine months ended July 31, 2015 : (In millions) Employee-related Facilities-related Product Rationalization Total Additions during fiscal 2014 $ 20.3 $ 0.5 $ 15.3 $ 36.1 Payments during the fiscal year (0.4 ) — — (0.4 ) Non-cash adjustments (b) — — (15.3 ) (15.3 ) Balance at October 31, 2014 19.9 0.5 — 20.4 Additions (reductions) during the nine months ended July 31, 2015 (5.9 ) 0.3 26.2 20.6 Payments during the nine months ended July 31, 2015 (5.3 ) (0.1 ) — (5.4 ) Non-cash adjustments (a) (b) 0.2 (0.1 ) (26.2 ) (26.1 ) Balance as of July 31, 2015 $ 8.9 $ 0.6 $ — $ 9.5 (a) Non-cash adjustments for employee-related and facilities-related costs represent currency translation adjustment. (b) Non-cash adjustments for product rationalization represent equipment disposals, inventory write-offs and accelerated depreciation. |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | (In thousands) July 31, 2015 October 31, 2014 Raw materials $ 78,051 $ 76,870 Work-in-process 14,471 14,344 Finished goods 313,444 290,260 $ 405,966 $ 381,474 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Goodwill (In thousands) CooperVision CooperSurgical Total Balance as of October 31, 2013 $ 1,048,478 $ 339,133 $ 1,387,611 Net additions during the year ended October 31, 2014 857,146 25,543 882,689 Translation (44,063 ) (5,316 ) (49,379 ) Balance as of October 31, 2014 1,861,561 359,360 2,220,921 Net reductions during the nine-month period ended July 31, 2015 (1,189 ) (8 ) (1,197 ) Translation (23,306 ) (7,265 ) (30,571 ) Balance as of July 31, 2015 $ 1,837,066 $ 352,087 $ 2,189,153 |
Schedule of Other Intangible Assets | Other Intangible Assets As of July 31, 2015 As of October 31, 2014 (In thousands) Gross Carrying Amount Accumulated Amortization & Translation Gross Carrying Amount Accumulated Amortization & Translation Trademarks $ 20,546 $ 3,938 $ 21,281 $ 2,937 Technology 320,447 109,617 326,620 93,780 Customer relationships 226,588 100,463 233,246 90,704 License and distribution rights and other 72,228 23,505 73,479 13,600 639,809 $ 237,523 654,626 $ 201,021 Less accumulated amortization and translation 237,523 201,021 Other intangible assets, net $ 402,286 $ 453,605 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | (In thousands) July 31, 2015 October 31, 2014 Short-term: Loan notes issued for Sauflon acquisition $ — $ 55,074 Overdraft and other credit facilities 237,558 46,444 $ 237,558 $ 101,518 Long-term: Credit agreement $ 69,800 $ 279,500 Term loans 1,000,000 1,000,000 Other 499 1,333 $ 1,070,299 $ 1,280,833 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | Periods Ended July 31, Three Months Nine Months (In thousands, except per share amounts) 2015 2014 2015 2014 Net income attributable to Cooper stockholders $ 44,951 $ 88,067 $ 166,844 $ 239,070 Basic: Weighted average common shares 48,600 48,042 48,421 47,990 Basic earnings per common share attributable to Cooper stockholders $ 0.92 $ 1.83 $ 3.45 $ 4.98 Diluted: Weighted average common shares 48,600 48,042 48,421 47,990 Effect of potential dilutive common shares 644 880 736 911 Diluted weighted average common shares 49,244 48,922 49,157 48,901 Diluted earnings per common share attributable to Cooper stockholders $ 0.91 $ 1.80 $ 3.39 $ 4.89 |
Schedule of Stock Options to Purchase Common Stock Not Included in Diluted Net Income Per Share Calculation | The following table sets forth stock options to purchase Cooper’s common stock and restricted stock units that were not included in the diluted earnings per share calculation because their effect would have been antidilutive for the periods presented: Periods Ended July 31, Three Months Nine Months (In thousands, except exercise prices) 2015 2014 2015 2014 Numbers of stock option shares excluded 49 138 123 138 Range of exercise prices $ 162.28 $ 119.89 $ 162.28 $ 119.89 Numbers of restricted stock units excluded 1 — 5 1 |
Share-Based Compensation Plans
Share-Based Compensation Plans (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Share-based Compensation [Abstract] | |
Schedule of Compensation Expense and Related Income Tax Benefit for Share-Based Awards | The compensation expense and related income tax benefit recognized in our consolidated condensed financial statements for share-based awards were as follows: Periods Ended July 31, Three Months Nine Months (In millions) 2015 2014 2015 2014 Selling, general and administrative expense $ 6.2 $ 6.4 $ 22.1 $ 26.2 Cost of sales 0.6 0.5 2.0 1.8 Research and development expense 0.2 0.5 0.7 1.5 Total share-based compensation expense $ 7.0 $ 7.4 $ 24.8 $ 29.5 Related income tax benefit $ 2.2 $ 2.3 $ 7.8 $ 9.6 |
Stockholders' Equity Analysis o
Stockholders' Equity Analysis of Changes in Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Analysis of Changes in Accumulated Other Comprehensive Income (Loss): (In thousands) Foreign Currency Translation Adjustment Change in Value of Derivative Instruments Minimum Pension Liability Total Balance at October 31, 2014 $ (92,355 ) $ (47 ) $ (13,780 ) $ (106,182 ) Gross change in value for the period (62,027 ) — 22 (62,005 ) Reclassification adjustments for loss realized in net income — 77 — 77 Tax effect for the period — (30 ) — (30 ) Balance at July 31, 2015 $ (154,382 ) $ — $ (13,758 ) $ (168,140 ) Balance at October 31, 2013 $ (4,592 ) $ (1,033 ) $ (10,137 ) $ (15,762 ) Gross change in value for the period 14,168 (58 ) 22 14,132 Reclassification adjustments for loss realized in net income — 1,445 — 1,445 Tax effect for the period — (541 ) — (541 ) Balance at July 31, 2014 $ 9,576 $ (187 ) $ (10,115 ) $ (726 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Level 2 Inputs | The following table sets forth our financial assets and liabilities that were measured at fair value on a recurring basis using Level 2 inputs during the fiscal first nine months of 2015 , within the fair value hierarchy at July 31, 2015 , and fiscal year 2014 , within the fair value hierarchy at October 31, 2014 : (In millions) July 31, 2015 October 31, 2014 Assets: Foreign exchange contracts $ 0.3 $ 0.6 Liabilities: Interest rate swaps $ — 0.1 Foreign exchange contracts 0.6 3.3 $ 0.6 $ 3.4 |
Employee Benefits (Tables)
Employee Benefits (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |
Schedule of Components of Net Periodic Pension Costs | Our results of operations for the three and nine months ended July 31, 2015 and 2014 reflect the following components of net periodic pension costs: Periods Ended July 31, Three Months Nine Months (In thousands) 2015 2014 2015 2014 Service cost $ 2,037 $ 1,768 $ 6,110 $ 5,305 Interest cost 1,063 988 3,191 2,963 Expected returns on assets (1,512 ) (1,237 ) (4,538 ) (3,712 ) Amortization of prior service cost 1 6 3 18 Recognized net actuarial loss 246 154 740 462 Net periodic pension cost $ 1,835 $ 1,679 $ 5,506 $ 5,036 |
Business Segment Information (T
Business Segment Information (Tables) | 9 Months Ended |
Jul. 31, 2015 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | Segment information: Periods Ended July 31, Three Months Nine Months (In thousands) 2015 2014 2015 2014 CooperVision net sales by category: Toric lens $ 114,227 $ 112,330 $ 329,784 $ 318,290 Multifocal lens 42,620 38,393 122,985 107,627 Single-use sphere lens 93,730 73,834 263,037 214,310 Non single-use sphere and other 134,893 125,343 398,599 367,058 Total CooperVision net sales 385,470 349,900 1,114,405 1,007,285 CooperSurgical net sales 76,208 82,582 227,119 242,494 Total net sales $ 461,678 $ 432,482 $ 1,341,524 $ 1,249,779 Operating income (loss): CooperVision $ 46,359 $ 88,386 $ 187,233 $ 255,150 CooperSurgical 15,043 18,419 42,451 50,673 Corporate (11,091 ) (10,240 ) (35,266 ) (38,712 ) Total operating income 50,311 96,565 194,418 267,111 Interest expense 4,690 1,499 13,323 4,713 Other expense, net 1,020 683 2,037 739 Income before income taxes $ 44,601 $ 94,383 $ 179,058 $ 261,659 |
Schedule of Identifiable Assets by Segment | (In thousands) July 31, 2015 October 31, 2014 Identifiable assets: CooperVision $ 3,735,893 $ 3,699,614 CooperSurgical 628,800 646,200 Corporate 57,989 112,526 Total $ 4,422,682 $ 4,458,340 |
Schedule of Net Sales to External Customers by Country of Domicile | Geographic information: Periods Ended July 31, Three Months Nine Months (In thousands) 2015 2014 2015 2014 Net sales to external customers by country of domicile: United States $ 203,019 $ 196,032 $ 604,281 $ 573,282 Europe 173,829 145,543 487,579 406,007 Rest of world 84,830 90,907 249,664 270,490 Total $ 461,678 $ 432,482 $ 1,341,524 $ 1,249,779 |
Schedule of Long-Lived Assets by Country of Domicile | (In thousands) July 31, 2015 October 31, 2014 Long-lived assets by country of domicile: United States $ 497,050 $ 499,195 Europe 418,700 406,433 Rest of world 59,126 31,697 Total $ 974,876 $ 937,325 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Thousands | Aug. 06, 2014 | Jul. 31, 2015 | Oct. 31, 2014 | Aug. 01, 2014 | Oct. 31, 2013 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 2,189,153 | $ 2,220,921 | $ 1,387,611 | ||
Sauflon [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Acquisition, Effective Date of Acquisition | Aug. 6, 2014 | ||||
Payments to Acquire Businesses, Gross | $ 1,073,200 | ||||
Payments to Acquire Businesses, Net of Cash Acquired | 1,063,100 | ||||
Business Combination, Consideration Transferred, Liabilities Incurred | 58,000 | ||||
Goodwill | $ 856,200 | ||||
Purchased intangible assets | 279,400 | ||||
Cash and Equivalents | 10,100 | ||||
Property, Plant, and Equipment | 83,900 | ||||
Inventories | 36,200 | ||||
Trade accounts receivable | 42,300 | ||||
Other Current Assets | 6,900 | ||||
Debt | (85,100) | ||||
Accounts Payable | (23,600) | ||||
Long term deferred tax liabilities | (56,700) | ||||
Other creditors and current liabilities | (18,500) | ||||
Net tangible liabilities | (4,500) | ||||
Total purchase consideration | $ 1,131,100 | ||||
Trademarks [Member] | Sauflon [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||||
Finite-Lived Intangibles | 7,200 | ||||
Technology-Based Intangible Assets [Member] | Sauflon [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||||
Finite-Lived Intangibles | 138,200 | ||||
Customer Relationships [Member] | Sauflon [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 15 years | ||||
Finite-Lived Intangibles | 39,300 | ||||
License and distribution right and other [Member] | Sauflon [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangibles | 51,600 | ||||
Minimum [Member] | License and distribution right and other [Member] | Sauflon [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 2 years | ||||
Maximum [Member] | License and distribution right and other [Member] | Sauflon [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 5 years | ||||
In Process Research and Development [Member] | Sauflon [Member] | |||||
Business Acquisition [Line Items] | |||||
Indefinite-Lived Intangible Assets | $ 43,100 |
Acquisitions (Pro Forma) (Detai
Acquisitions (Pro Forma) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Amortization of intangibles | $ 12,495 | $ 6,752 | $ 38,406 | $ 21,735 |
Interest expense | $ 4,690 | 1,499 | $ 13,323 | 4,713 |
Sauflon [Member] | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Revenue | 481,800 | 1,390,200 | ||
Net income attributable to Cooper stockholders | $ 82,900 | $ 226,600 | ||
Diluted earnings per share | $ 1.69 | $ 4.63 | ||
Sauflon [Member] | Pro Forma [Member] | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Amortization of intangibles | $ 7,400 | $ 22,300 | ||
Interest expense | $ 1,100 | $ 3,400 |
Restructuring and Integration36
Restructuring and Integration Costs (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Jul. 31, 2015 | Jul. 31, 2015 | Oct. 31, 2014 | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and related activities, completion date | Oct. 31, 2016 | ||
Sauflon [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and related cost, expected cost | $ 104 | $ 104 | |
Additions during the period | 20.6 | $ 36.1 | |
Integration costs | 10.7 | 24.7 | 2.8 |
Sauflon [Member] | Additional Manufacturing Restructuring Activities [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and related cost, expected cost | 42 | 42 | |
Sauflon [Member] | Product Rationalization [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and related cost, expected cost | 80 | 80 | |
Additions during the period | 26.2 | 15.3 | |
Sauflon [Member] | Product Rationalization [Member] | Cost of sales [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Additions during the period | 12.4 | 26.2 | 15.3 |
Sauflon [Member] | Employee Severance [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and related cost, expected cost | 18 | 18 | |
Additions during the period | (5.9) | 20.3 | |
Sauflon [Member] | Employee Severance [Member] | Cost of sales [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Additions during the period | 0.3 | ||
Sauflon [Member] | Employee Severance [Member] | Selling, general and administrative expense [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Additions during the period | (2.3) | (6.7) | 19.7 |
Sauflon [Member] | Employee Severance [Member] | Research and development expense [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Additions during the period | 0.2 | 0.5 | 0.6 |
Sauflon [Member] | Facility Closing [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and related cost, expected cost | 6 | 6 | |
Additions during the period | $ 0.3 | 0.5 | |
Sauflon [Member] | Facility Closing [Member] | Selling, general and administrative expense [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Additions during the period | $ 0.3 | $ 0.5 |
Restructuring and Integration37
Restructuring and Integration Costs (Details) - Sauflon [Member] - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Jul. 31, 2015 | Oct. 31, 2014 | |
Restructuring Cost and Reserve [Line Items] | ||
Cumulative amounts incurred as of July 31, 2015 | $ 56.7 | |
Restructuring Reserve [Roll Forward] | ||
Balance, beginning | 20.4 | |
Additions (reductions) during the period | 20.6 | $ 36.1 |
Payments during the period | (5.4) | (0.4) |
Non-cash adjustments | (26.1) | (15.3) |
Balance, ending | 9.5 | 20.4 |
Employee Severance [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Cumulative amounts incurred as of July 31, 2015 | 14.4 | |
Restructuring Reserve [Roll Forward] | ||
Balance, beginning | 19.9 | |
Additions (reductions) during the period | (5.9) | 20.3 |
Payments during the period | (5.3) | (0.4) |
Non-cash adjustments | 0.2 | 0 |
Balance, ending | 8.9 | 19.9 |
Facility Closing [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Cumulative amounts incurred as of July 31, 2015 | 0.8 | |
Restructuring Reserve [Roll Forward] | ||
Balance, beginning | 0.5 | |
Additions (reductions) during the period | 0.3 | 0.5 |
Payments during the period | (0.1) | 0 |
Non-cash adjustments | (0.1) | 0 |
Balance, ending | 0.6 | 0.5 |
Product Rationalization [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Cumulative amounts incurred as of July 31, 2015 | 41.5 | |
Restructuring Reserve [Roll Forward] | ||
Balance, beginning | 0 | |
Additions (reductions) during the period | 26.2 | 15.3 |
Payments during the period | 0 | 0 |
Non-cash adjustments | (26.2) | (15.3) |
Balance, ending | $ 0 | $ 0 |
Inventories (Schedule of Invent
Inventories (Schedule of Inventories) (Details) - USD ($) $ in Thousands | Jul. 31, 2015 | Oct. 31, 2014 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 78,051 | $ 76,870 |
Work-in-process | 14,471 | 14,344 |
Finished goods | 313,444 | 290,260 |
Inventories, net | $ 405,966 | $ 381,474 |
Intangible Assets (Schedule of
Intangible Assets (Schedule of Goodwill) (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Jul. 31, 2015 | Oct. 31, 2014 | |
Goodwill [Roll Forward] | ||
Balance, beginning | $ 2,220,921 | $ 1,387,611 |
Net additions during the year ended October 31, 2014 | 882,689 | |
Net reductions during the nine-month period ended July 31, 2015 | (1,197) | |
Translation | (30,571) | (49,379) |
Balance, ending | 2,189,153 | 2,220,921 |
CooperVision [Member] | ||
Goodwill [Roll Forward] | ||
Balance, beginning | 1,861,561 | 1,048,478 |
Net additions during the year ended October 31, 2014 | 857,146 | |
Net reductions during the nine-month period ended July 31, 2015 | (1,189) | |
Translation | (23,306) | (44,063) |
Balance, ending | 1,837,066 | 1,861,561 |
CooperSurgical [Member] | ||
Goodwill [Roll Forward] | ||
Balance, beginning | 359,360 | 339,133 |
Net additions during the year ended October 31, 2014 | 25,543 | |
Net reductions during the nine-month period ended July 31, 2015 | (8) | |
Translation | (7,265) | (5,316) |
Balance, ending | $ 352,087 | $ 359,360 |
Intangible Assets (Schedule o40
Intangible Assets (Schedule of Other Intangible Assets) (Details) - USD ($) $ in Thousands | Jul. 31, 2015 | Oct. 31, 2014 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 639,809 | $ 654,626 |
Accumulated Amortization & Translation | 237,523 | 201,021 |
Other intangible assets, net | 402,286 | 453,605 |
Trademarks [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 20,546 | 21,281 |
Accumulated Amortization & Translation | 3,938 | 2,937 |
Technology-Based Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 320,447 | 326,620 |
Accumulated Amortization & Translation | 109,617 | 93,780 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 226,588 | 233,246 |
Accumulated Amortization & Translation | 100,463 | 90,704 |
License and distribution right and other [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 72,228 | 73,479 |
Accumulated Amortization & Translation | $ 23,505 | $ 13,600 |
Intangible Assets (Narrative) (
Intangible Assets (Narrative) (Details) - USD ($) | 9 Months Ended | |
Jul. 31, 2015 | Jul. 31, 2014 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill, Impairment Loss | $ 0 | $ 0 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2,015 | 50,900,000 | |
2,016 | 48,500,000 | |
2,017 | 45,200,000 | |
2,018 | 43,300,000 | |
2,019 | $ 40,500,000 |
Debt (Schedule of Debt) (Detail
Debt (Schedule of Debt) (Details) - USD ($) $ in Thousands | Jul. 31, 2015 | Oct. 31, 2014 |
Short-term: | ||
Loan notes issued for Sauflon acquisition | $ 0 | $ 55,074 |
Overdraft and other credit facilities | 237,558 | 46,444 |
Short-term debt | 237,558 | 101,518 |
Long-term: | ||
Credit agreement | 69,800 | 279,500 |
Term loans | 1,000,000 | 1,000,000 |
Other | 499 | 1,333 |
Long-term debt | $ 1,070,299 | $ 1,280,833 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) | Mar. 24, 2015USD ($) | Aug. 04, 2014USD ($) | Sep. 12, 2013USD ($) | May. 31, 2012USD ($) | Jan. 12, 2011 | Jul. 31, 2015USD ($) | Oct. 31, 2014USD ($) |
Line of Credit Facility [Line Items] | |||||||
Required minimum Interest coverage ratio | 3 | ||||||
Required maximum total leverage ratio | 3.75 | ||||||
Interest coverage ratio | 33.87 | ||||||
Total leverage ratio | 2.33 | ||||||
Amount available under the credit agreement | $ 930,000,000 | ||||||
Term loans | 1,000,000,000 | $ 1,000,000,000 | |||||
Short-term debt | 237,558,000 | $ 101,518,000 | |||||
Minimum [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Commitment fee percentage | 0.10% | ||||||
Line of credit facility interest rate margin on base rate loans percentage | 0.00% | ||||||
Line of credit facility interest rate margin on foreign currency loans percentage | 1.00% | ||||||
Maximum [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Commitment fee percentage | 0.275% | ||||||
Line of credit facility interest rate margin on base rate loans percentage | 0.75% | ||||||
Line of credit facility interest rate margin on foreign currency loans percentage | 1.75% | ||||||
Revolving Credit Facility [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Line of credit facility, initiation date | Jan. 12, 2011 | ||||||
Aggregate commitment amount of credit facility | $ 1,000,000,000 | ||||||
Additional borrowings | $ 500,000,000 | ||||||
Expiration date | May 31, 2017 | ||||||
Term Loan $300M [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, issuance date | Sep. 12, 2013 | ||||||
Debt instrument, maturity date | Sep. 12, 2018 | ||||||
Debt term | 5 years | ||||||
Term loans | $ 300,000,000 | 300,000,000 | |||||
Amortization of term loan principal | 5.00% | ||||||
Debt instrument, date of first required payment | Oct. 31, 2016 | ||||||
Term Loan $300M [Member] | Federal Funds Rate [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 0.50% | ||||||
Term Loan $300M [Member] | Eurodollar [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 1.00% | ||||||
Term Loan $700M [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, issuance date | Aug. 4, 2014 | ||||||
Debt instrument, maturity date | Aug. 4, 2017 | ||||||
Debt term | 3 years | ||||||
Term loans | $ 700,000,000 | 700,000,000 | |||||
Term Loan $700M [Member] | Federal Funds Rate [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 0.50% | ||||||
Term Loan $700M [Member] | Eurodollar [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 1.00% | ||||||
Line of Credit [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Aggregate commitment amount of credit facility | $ 100,000,000 | ||||||
Debt instrument, issuance date | Mar. 24, 2015 | ||||||
Debt instrument, maturity date | Mar. 24, 2016 | ||||||
Debt term | 90 days | ||||||
Short-term debt | $ 200,000,000 | ||||||
Line of Credit [Member] | Eurodollar [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 0.90% |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Nov. 01, 2014 | |
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Effective tax rate (ETR) | 6.10% | 8.10% | |
Unrecognized tax benefits that would impact ETR | $ 32 | ||
Interest and penalties | 4.1 | ||
Unrecognized tax benefits related to tax positions | $ 10.2 |
Earnings Per Share (Schedule of
Earnings Per Share (Schedule of Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to Cooper stockholders | $ 44,951 | $ 88,067 | $ 166,844 | $ 239,070 |
Basic: | ||||
Weighted average common shares | 48,600 | 48,042 | 48,421 | 47,990 |
Basic earnings per common share attributable to Cooper stockholders | $ 0.92 | $ 1.83 | $ 3.45 | $ 4.98 |
Diluted: | ||||
Effect of potential dilutive common shares | 644 | 880 | 736 | 911 |
Diluted weighted average common shares | 49,244 | 48,922 | 49,157 | 48,901 |
Diluted earnings per common share attributable to Cooper stockholders | $ 0.91 | $ 1.80 | $ 3.39 | $ 4.89 |
Earnings Per Share (Schedule 46
Earnings Per Share (Schedule of Stock Options to Purchase Common Stock Not Included in Diluted Net Income Per Share Calculation) (Details) - $ / shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Stock Options [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Numbers of stock option shares excluded | 49 | 138 | 123 | 138 |
Range of exercise prices, lower limit | $ 162.28 | $ 119.89 | $ 162.28 | $ 119.89 |
Range of exercise prices, upper limit | $ 162.28 | $ 119.89 | $ 162.28 | $ 119.89 |
Restricted Stock Units (RSUs) [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Numbers of stock option shares excluded | 1 | 0 | 5 | 1 |
Share-Based Compensation Plan47
Share-Based Compensation Plans (Schedule Of Compensation Expense And Related Income Tax Benefit For Share-Based Awards) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ 7 | $ 7.4 | $ 24.8 | $ 29.5 |
Related income tax benefit | 2.2 | 2.3 | 7.8 | 9.6 |
Selling, general and administrative expense [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 6.2 | 6.4 | 22.1 | 26.2 |
Cost of sales [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 0.6 | 0.5 | 2 | 1.8 |
Research and development expense [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 0.2 | 0.5 | 0.7 | 1.5 |
Capitalized in inventory [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 0.6 | $ 0.5 | $ 2 | $ 1.8 |
Stockholders' Equity (Schedule
Stockholders' Equity (Schedule of Changes in Accumulated Other Comprehensive Income (Loss))(Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Foreign Currency Translation Adjustment [Roll Forward] | ||||
Foreign Currency Translation Adjustment, Beginning Balance | $ (92,355) | $ (4,592) | ||
Foreign Currency Translation Adjustment, Gross change in value for the period | (62,027) | 14,168 | ||
Foreign Currency Translation Adjustment, Reclassification adjustments for loss realized in net income | 0 | 0 | ||
Foreign Currency Translation Adjustment, Tax effect for the period | 0 | 0 | ||
Foreign Currency Translation Adjustment, Ending Balance | $ (154,382) | $ 9,576 | (154,382) | 9,576 |
Change in Value of Derivative Instruments [Roll Forward] | ||||
Change in Value of Derivative Instruments, Beginning Balance | (47) | (1,033) | ||
Change in Value of Derivative Instruments, Gross change in value for the period | 0 | (58) | ||
Change in Value of Derivative Instruments, Reclassification adjustments for loss realized in net income | 77 | 1,445 | ||
Change in value of derivative instruments, Tax effect for the period | 0 | (144) | (30) | (541) |
Change in Value of Derivative Instruments, Ending Balance | 0 | (187) | 0 | (187) |
Minimum Pension Liability [Roll Forward] | ||||
Minimum Pension Liability, Beginning Balance | (13,780) | (10,137) | ||
Minimum Pension Liability, Gross change in value for the period | 22 | 22 | ||
Minimum Pension Liability, Reclassification adjustments for loss realized in net income | 0 | 0 | ||
Minimum Pension Liability, Tax effect for the period | 0 | 0 | ||
Minimum Pension Liability, Ending Balance | (13,758) | (10,115) | (13,758) | (10,115) |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Total, Beginning balance | (106,182) | (15,762) | ||
Gross change in value for the period | (62,005) | 14,132 | ||
Reclassification adjustments for loss realized in net income | 77 | 1,445 | ||
Tax effect for the period | (30) | (541) | ||
Total, Ending balance | $ (168,140) | $ (726) | $ (168,140) | $ (726) |
Stockholders' Equity (Share Rep
Stockholders' Equity (Share Repurchases) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||||
Jul. 31, 2015 | Jan. 31, 2015 | Jul. 31, 2014 | Jan. 31, 2014 | Dec. 15, 2011 | |
Equity [Abstract] | |||||
Share Repurchase Program, maximum amount authorized | $ 500 | ||||
Number of common stock repurchased, shares | 0 | 100,000 | 0 | 396,000 | |
Cost of common stock repurchased | $ 16 | $ 50 | |||
Average purchase price per share | $ 159.96 | $ 126.21 | |||
Share Repurchase Program, remaining authorized amount | $ 169.7 |
Stockholders' Equity (Dividends
Stockholders' Equity (Dividends) (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 06, 2015 | Feb. 09, 2015 | Jul. 31, 2015 | Jan. 31, 2015 | Jul. 31, 2015 | Jul. 31, 2014 |
Subsequent Event [Line Items] | ||||||
Dividends on common stock | $ 1,400 | $ 1,448 | $ 1,436 | |||
Cash dividend, per share | $ 0.03 | |||||
Dividends payable, date of record | Jul. 24, 2015 | Jan. 23, 2015 | ||||
Subsequent Event [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Dividends on common stock | $ 1,500 | |||||
Cash dividend, per share | $ 0.03 |
Fair Value Measurements (Schedu
Fair Value Measurements (Schedule Of Financial Assets And Liabilities Measured At Fair Value On A Recurring Basis Using Level 2 Inputs) (Details) - Significant Observable Inputs (Level 2) [Member] - USD ($) $ in Millions | Jul. 31, 2015 | Oct. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of financial liabilities | $ 0.6 | $ 3.4 |
Foreign Exchange Contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value financial assets | 0.3 | 0.6 |
Fair value of financial liabilities | 0.6 | 3.3 |
Interest Rate Swaps [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of financial liabilities | $ 0 | $ 0.1 |
Employee Benefits (Schedule of
Employee Benefits (Schedule of Components of Net Periodic Pension Costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | ||||
Service cost | $ 2,037 | $ 1,768 | $ 6,110 | $ 5,305 |
Interest cost | 1,063 | 988 | 3,191 | 2,963 |
Expected returns on assets | (1,512) | (1,237) | (4,538) | (3,712) |
Amortization of prior service cost | 1 | 6 | 3 | 18 |
Recognized net actuarial loss | 246 | 154 | 740 | 462 |
Net periodic pension cost | $ 1,835 | $ 1,679 | $ 5,506 | $ 5,036 |
Employee Benefits (Narrative) (
Employee Benefits (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | ||||
Company's contribution to the pension plan | $ 2.5 | $ 1.4 | $ 5 | $ 5.8 |
Defined benefit plan, estimated future employer contributions in current fiscal year | $ 5 | |||
Expected rate of return on plan assets for determining net periodic pension cost | 8.00% |
Contingencies (Details)
Contingencies (Details) - Jul. 31, 2015 $ in Millions | USD ($) | action |
Commitments and Contingencies Disclosure [Abstract] | ||
Litigation settlement, amount | $ 17 | |
Number of putative class action complaints filed (over) | action | 50 |
Business Segment Information (S
Business Segment Information (Schedule of Segment Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 461,678 | $ 432,482 | $ 1,341,524 | $ 1,249,779 |
Operating income (loss) | 50,311 | 96,565 | 194,418 | 267,111 |
Interest expense | 4,690 | 1,499 | 13,323 | 4,713 |
Other expense, net | 1,020 | 683 | 2,037 | 739 |
Income before income taxes | 44,601 | 94,383 | 179,058 | 261,659 |
CooperVision [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 385,470 | 349,900 | 1,114,405 | 1,007,285 |
Operating income (loss) | 46,359 | 88,386 | 187,233 | 255,150 |
CooperSurgical [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 76,208 | 82,582 | 227,119 | 242,494 |
Operating income (loss) | 15,043 | 18,419 | 42,451 | 50,673 |
Corporate Segment [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Operating income (loss) | (11,091) | (10,240) | (35,266) | (38,712) |
Toric Lens [Member] | CooperVision [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 114,227 | 112,330 | 329,784 | 318,290 |
Multifocal Lens [Member] | CooperVision [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 42,620 | 38,393 | 122,985 | 107,627 |
Single-Use Sphere Lens [Member] | CooperVision [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 93,730 | 73,834 | 263,037 | 214,310 |
Non Single-Use Sphere And Other Eye Care Products And Other [Member] | CooperVision [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | $ 134,893 | $ 125,343 | $ 398,599 | $ 367,058 |
Business Segment Information 56
Business Segment Information (Schedule of Identifiable Assets By Segment Information) (Details) - USD ($) $ in Thousands | Jul. 31, 2015 | Oct. 31, 2014 |
Segment Reporting Information [Line Items] | ||
Total Identifiable assets | $ 4,422,682 | $ 4,458,340 |
CooperVision [Member] | ||
Segment Reporting Information [Line Items] | ||
Total Identifiable assets | 3,735,893 | 3,699,614 |
CooperSurgical [Member] | ||
Segment Reporting Information [Line Items] | ||
Total Identifiable assets | 628,800 | 646,200 |
Corporate Segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Total Identifiable assets | $ 57,989 | $ 112,526 |
Business Segment Information 57
Business Segment Information (Schedule of Net Sales To External Customers By Country Of Domicile) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2015 | Jul. 31, 2014 | Jul. 31, 2015 | Jul. 31, 2014 | |
Segment Reporting Information [Line Items] | ||||
Total net sales to external customers | $ 461,678 | $ 432,482 | $ 1,341,524 | $ 1,249,779 |
United States [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total net sales to external customers | 203,019 | 196,032 | 604,281 | 573,282 |
Europe [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total net sales to external customers | 173,829 | 145,543 | 487,579 | 406,007 |
Rest Of World [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total net sales to external customers | $ 84,830 | $ 90,907 | $ 249,664 | $ 270,490 |
Business Segment Information 58
Business Segment Information (Schedule of Long-Lived Assets By Country Of Domicile) (Details) - USD ($) $ in Thousands | Jul. 31, 2015 | Oct. 31, 2014 |
Segment Reporting Information [Line Items] | ||
Total long-lived assets | $ 974,876 | $ 937,325 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | 497,050 | 499,195 |
Europe [Member] | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | 418,700 | 406,433 |
Rest Of World [Member] | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | $ 59,126 | $ 31,697 |