Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2024 | Jul. 30, 2024 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2024 | |
Entity File Number | 0-18592 | |
Entity Registrant Name | MERIT MEDICAL SYSTEMS INC | |
Entity Incorporation, State or Country Code | UT | |
Entity Central Index Key | 0000856982 | |
Entity Tax Identification Number | 87-0447695 | |
Entity Address, Address Line One | 1600 West Merit Parkway | |
Entity Address, City or Town | South Jordan | |
Entity Address, State or Province | UT | |
Entity Address, Postal Zip Code | 84095 | |
City Area Code | 801 | |
Local Phone Number | 253-1600 | |
Title of 12(b) Security | Common Stock, no par value | |
Trading Symbol | MMSI | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 58,208,536 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 636,658 | $ 587,036 |
Trade receivables - net of allowance for credit losses - 2024 - $9,276 and 2023 - $9,023 | 182,415 | 177,885 |
Other receivables | 10,612 | 10,517 |
Inventories | 298,224 | 303,871 |
Prepaid expenses and other current assets | 26,179 | 24,286 |
Prepaid income taxes | 4,123 | 4,016 |
Income tax refund receivables | 4,335 | 859 |
Total current assets | 1,162,546 | 1,108,470 |
Property and equipment: | ||
Land and land improvements | 25,952 | 26,017 |
Buildings | 191,030 | 191,491 |
Manufacturing equipment | 330,290 | 316,930 |
Furniture and fixtures | 64,755 | 63,044 |
Leasehold improvements | 58,595 | 53,638 |
Construction-in-progress | 61,060 | 61,439 |
Total property and equipment | 731,682 | 712,559 |
Less accumulated depreciation | (345,743) | (329,036) |
Property and equipment - net | 385,939 | 383,523 |
Other assets: | ||
Goodwill | 381,433 | 382,240 |
Deferred income tax assets | 7,013 | 7,288 |
Right-of-use operating lease assets | 69,903 | 63,047 |
Other assets | 61,583 | 54,793 |
Total other assets | 823,354 | 833,251 |
Total assets | 2,371,839 | 2,325,244 |
Current liabilities: | ||
Trade payables | 55,573 | 65,944 |
Accrued expenses | 117,574 | 120,447 |
Short-term operating lease liabilities | 11,743 | 12,087 |
Income taxes payable | 1,325 | 5,086 |
Total current liabilities | 186,215 | 203,564 |
Long-term debt | 801,321 | 823,013 |
Deferred income tax liabilities | 5,510 | 5,547 |
Long-term income taxes payable | 347 | 347 |
Liabilities related to unrecognized tax benefits | 1,912 | 1,912 |
Deferred compensation payable | 18,588 | 17,167 |
Deferred credits | 1,553 | 1,605 |
Long-term operating lease liabilities | 58,036 | 56,259 |
Other long-term obligations | 15,912 | 13,830 |
Total liabilities | 1,089,394 | 1,123,244 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock - 5,000 shares authorized; no shares issued as of June 30, 2024 and December 31, 2023 | ||
Common stock, no par value - 100,000 shares authorized; issued and outstanding as of June 30, 2024 - 58,192 and December 31, 2023 - 57,858 | 658,724 | 638,150 |
Retained earnings | 639,150 | 575,184 |
Accumulated other comprehensive loss | (15,429) | (11,334) |
Total stockholders' equity | 1,282,445 | 1,202,000 |
Total liabilities and stockholders' equity | 2,371,839 | 2,325,244 |
Developed technology | ||
Other assets: | ||
Intangible assets: | 264,195 | 283,999 |
Other | ||
Other assets: | ||
Intangible assets: | $ 39,227 | $ 41,884 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Current assets: | ||
Trade receivables, allowances | $ 9,276 | $ 9,023 |
Stockholders' equity: | ||
Preferred stock shares authorized (in shares) | 5,000 | 5,000 |
Preferred stock shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock shares authorized (in shares) | 100,000 | 100,000 |
Common stock shares issued (in shares) | 58,192 | 57,858 |
Common stock shares outstanding (in shares) | 58,192 | 57,858 |
Developed technology | ||
Other assets: | ||
Intangibles, accumulated amortization | $ 346,763 | $ 321,488 |
Other | ||
Other assets: | ||
Intangibles, accumulated amortization | $ 80,628 | $ 76,887 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Income Statement [Abstract] | ||||
Net sales | $ 338,003 | $ 320,056 | $ 661,511 | $ 617,621 |
Cost of sales | 176,903 | 167,274 | 348,696 | 326,477 |
Gross profit | 161,100 | 152,782 | 312,815 | 291,144 |
Operating expenses: | ||||
Selling, general and administrative | 94,585 | 100,927 | 189,013 | 191,071 |
Research and development | 20,263 | 20,129 | 41,745 | 41,443 |
Impairment charges | 270 | 270 | ||
Contingent consideration expense | 306 | 1,094 | 189 | 1,615 |
Acquired in-process research and development | 1,550 | 1,550 | ||
Total operating expenses | 115,154 | 123,970 | 230,947 | 235,949 |
Income from operations | 45,946 | 28,812 | 81,868 | 55,195 |
Other income (expense): | ||||
Interest income | 7,561 | 221 | 14,837 | 352 |
Interest expense | (7,679) | (3,682) | (15,725) | (5,693) |
Other income (expense) - net | 15 | (451) | (789) | 546 |
Total other expense - net | (103) | (3,912) | (1,677) | (4,795) |
Income before income taxes | 45,843 | 24,900 | 80,191 | 50,400 |
Income tax expense | 10,117 | 4,655 | 16,225 | 9,452 |
Net income | $ 35,726 | $ 20,245 | $ 63,966 | $ 40,948 |
Earnings per common share | ||||
Basic (in dollars per share) | $ 0.61 | $ 0.35 | $ 1.10 | $ 0.71 |
Diluted (in dollars per share) | $ 0.61 | $ 0.35 | $ 1.09 | $ 0.70 |
Weighted average shares outstanding | ||||
Basic (in shares) | 58,139 | 57,537 | 58,049 | 57,445 |
Diluted (in shares) | 58,740 | 58,473 | 58,653 | 58,329 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income | $ 35,726 | $ 20,245 | $ 63,966 | $ 40,948 |
Other comprehensive income (loss): | ||||
Cash flow hedges | (1,711) | 3,422 | 1,261 | 1,731 |
Income tax benefit (expense) | 404 | (821) | (298) | (415) |
Foreign currency translation adjustment | (1,688) | (1,201) | (5,092) | 724 |
Income tax benefit (expense) | 22 | (15) | 34 | (34) |
Total other comprehensive income (loss) | (2,973) | 1,385 | (4,095) | 2,006 |
Total comprehensive income | $ 32,753 | $ 21,630 | $ 59,871 | $ 42,954 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Retained Earnings | Accumulated Other Comprehensive Loss | Total |
Beginning balance at Dec. 31, 2022 | $ 675,174 | $ 480,773 | $ (11,550) | $ 1,144,397 |
Beginning balance (in shares) at Dec. 31, 2022 | 57,306 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 20,703 | 20,703 | ||
Other comprehensive income (loss) | 621 | 621 | ||
Stock-based compensation expense | $ 3,498 | 3,498 | ||
Options exercised | $ 3,726 | 3,726 | ||
Options exercised (in shares) | 123 | |||
Issuance of common stock under Employee Stock Purchase Plan | $ 302 | 302 | ||
Issuance of common stock under Employee Stock Purchase Plan (in shares) | 4 | |||
Shares issued from time-vested restricted stock units (in shares) | 61 | |||
Shares surrendered in exchange for payment of payroll tax liabilities | $ (1,592) | (1,592) | ||
Shares surrendered in exchange for payment of payroll tax liabilities (in shares) | (22) | |||
Ending balance at Mar. 31, 2023 | $ 681,108 | 501,476 | (10,929) | 1,171,655 |
Ending balance (in shares) at Mar. 31, 2023 | 57,472 | |||
Beginning balance at Dec. 31, 2022 | $ 675,174 | 480,773 | (11,550) | 1,144,397 |
Beginning balance (in shares) at Dec. 31, 2022 | 57,306 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 40,948 | |||
Other comprehensive income (loss) | 2,006 | |||
Ending balance at Jun. 30, 2023 | $ 691,523 | 521,721 | (9,544) | 1,203,700 |
Ending balance (in shares) at Jun. 30, 2023 | 57,634 | |||
Beginning balance at Mar. 31, 2023 | $ 681,108 | 501,476 | (10,929) | 1,171,655 |
Beginning balance (in shares) at Mar. 31, 2023 | 57,472 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 20,245 | 20,245 | ||
Other comprehensive income (loss) | 1,385 | 1,385 | ||
Stock-based compensation expense | $ 4,980 | 4,980 | ||
Options exercised | $ 5,154 | 5,154 | ||
Options exercised (in shares) | 128 | |||
Issuance of common stock under Employee Stock Purchase Plan | $ 281 | 281 | ||
Issuance of common stock under Employee Stock Purchase Plan (in shares) | 4 | |||
Shares issued from time-vested restricted stock units (in shares) | 30 | |||
Ending balance at Jun. 30, 2023 | $ 691,523 | 521,721 | (9,544) | 1,203,700 |
Ending balance (in shares) at Jun. 30, 2023 | 57,634 | |||
Beginning balance at Dec. 31, 2023 | $ 638,150 | 575,184 | (11,334) | $ 1,202,000 |
Beginning balance (in shares) at Dec. 31, 2023 | 57,858 | 57,858 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 28,240 | $ 28,240 | ||
Other comprehensive income (loss) | (1,122) | (1,122) | ||
Stock-based compensation expense | $ 4,934 | 4,934 | ||
Options exercised | $ 7,394 | 7,394 | ||
Options exercised (in shares) | 213 | |||
Issuance of common stock under Employee Stock Purchase Plan | $ 336 | 336 | ||
Issuance of common stock under Employee Stock Purchase Plan (in shares) | 5 | |||
Shares issued from time-vested restricted stock units (in shares) | 47 | |||
Shares surrendered in exchange for payment of payroll tax liabilities | $ (1,592) | (1,592) | ||
Shares surrendered in exchange for payment of payroll tax liabilities (in shares) | (21) | |||
Ending balance at Mar. 31, 2024 | $ 649,222 | 603,424 | (12,456) | 1,240,190 |
Ending balance (in shares) at Mar. 31, 2024 | 58,102 | |||
Beginning balance at Dec. 31, 2023 | $ 638,150 | 575,184 | (11,334) | $ 1,202,000 |
Beginning balance (in shares) at Dec. 31, 2023 | 57,858 | 57,858 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | $ 63,966 | |||
Other comprehensive income (loss) | (4,095) | |||
Ending balance at Jun. 30, 2024 | $ 658,724 | 639,150 | (15,429) | $ 1,282,445 |
Ending balance (in shares) at Jun. 30, 2024 | 58,192 | 58,192 | ||
Beginning balance at Mar. 31, 2024 | $ 649,222 | 603,424 | (12,456) | $ 1,240,190 |
Beginning balance (in shares) at Mar. 31, 2024 | 58,102 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 35,726 | 35,726 | ||
Other comprehensive income (loss) | (2,973) | (2,973) | ||
Stock-based compensation expense | $ 6,301 | 6,301 | ||
Options exercised | $ 2,913 | 2,913 | ||
Options exercised (in shares) | 66 | |||
Issuance of common stock under Employee Stock Purchase Plan | $ 288 | 288 | ||
Issuance of common stock under Employee Stock Purchase Plan (in shares) | 4 | |||
Shares issued from time-vested restricted stock units (in shares) | 20 | |||
Ending balance at Jun. 30, 2024 | $ 658,724 | $ 639,150 | $ (15,429) | $ 1,282,445 |
Ending balance (in shares) at Jun. 30, 2024 | 58,192 | 58,192 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 63,966 | $ 40,948 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 47,690 | 42,316 |
Loss on sale or abandonment of property and equipment | 79 | 4,677 |
Write-off of certain intangible assets and other long-term assets | 280 | 328 |
Acquired in-process research and development | 1,550 | |
Amortization of right-of-use operating lease assets | 6,063 | 5,935 |
Fair value adjustments related to contingent consideration liabilities | 189 | 1,615 |
Amortization of deferred credits | (52) | (52) |
Amortization of long-term debt issuance costs | 2,954 | 462 |
Stock-based compensation expense | 12,245 | 9,549 |
Changes in operating assets and liabilities, net of acquisitions and divestitures: | ||
Trade receivables | (6,901) | (5,980) |
Other receivables | (499) | 287 |
Inventories | 3,119 | (35,502) |
Prepaid expenses and other current assets | (2,306) | 78 |
Income tax refund receivables | (3,621) | (3,577) |
Other assets | (2,968) | (1,558) |
Trade payables | (7,096) | (7,253) |
Accrued expenses | (2,804) | (10,295) |
Income taxes payable | (3,869) | (4,896) |
Deferred compensation payable | 1,421 | 1,154 |
Operating lease liabilities | (5,962) | (5,711) |
Other long-term obligations | 2,794 | (2,244) |
Total adjustments | 40,756 | (9,117) |
Net cash, cash equivalents, and restricted cash provided by operating activities | 104,722 | 31,831 |
Capital expenditures for: | ||
Property and equipment | (22,309) | (18,556) |
Intangible assets | (1,576) | (1,047) |
Proceeds from the sale of property and equipment | 2 | 201 |
Issuance of note receivables | (6,162) | |
Cash paid in acquisitions and investments, net of cash acquired | (8,493) | (138,349) |
Net cash, cash equivalents, and restricted cash used in investing activities | (38,538) | (157,751) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock | 10,931 | 9,463 |
Proceeds from issuance of long-term debt | 460,283 | |
Payments on long-term debt | (24,063) | (318,471) |
Long-term debt issuance costs | (5,240) | |
Contingent payments related to acquisitions | (142) | (3,434) |
Payment of taxes related to an exchange of common stock | (1,592) | (1,592) |
Net cash, cash equivalents, and restricted cash (used in) provided by financing activities | (14,866) | 141,009 |
Effect of exchange rates on cash, cash equivalents, and restricted cash | (1,750) | (1,497) |
Net increase in cash, cash equivalents and restricted cash | 49,568 | 13,592 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH: | ||
Beginning of period | 589,144 | 60,558 |
End of period | 638,712 | 74,150 |
RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH TO THE CONSOLIDATED BALANCE SHEETS: | ||
Cash and cash equivalents | 636,658 | 72,084 |
Restricted cash reported in prepaid expenses and other current assets | $ 2,054 | $ 2,066 |
Restricted Cash and Cash Equivalents, Current, Statement of Financial Position [Extensible Enumeration] | Prepaid Expense and Other Assets, Current | Prepaid Expense and Other Assets, Current |
Total cash, cash equivalents and restricted cash | $ 638,712 | $ 74,150 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Interest (net of capitalized interest of $428 and $597, respectively) | 4,404 | 3,681 |
Income taxes | 22,619 | 17,787 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Property and equipment purchases in accounts payable | 5,411 | 4,291 |
Acquisition purchases in accrued expenses and other long-term obligations | 4,553 | 3,635 |
Right-of-use operating lease assets obtained in exchange for operating lease liabilities | $ 8,167 | $ 3,399 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
Net capitalized interest | $ 428 | $ 597 |
Basis of Presentation and Other
Basis of Presentation and Other Items | 6 Months Ended |
Jun. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Other Items | 1. Basis of Presentation and Other Items. |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Recently Issued Accounting Standards | 2. Recently Issued Accounting Standards. Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures We currently believe there are no other issued and not yet effective accounting standards that are materially relevant to our financial statements. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | 3. Revenue from Contracts with Customers. We recognize revenue when a customer obtains control of promised goods. The amount of revenue recognized reflects the consideration we expect to receive in exchange for these goods. Our revenue recognition policies have not changed from those disclosed in Note 1 to our consolidated financial statements in Item 8 of the 2023 Annual Report on Form 10-K. Disaggregation of Revenue Our revenue is disaggregated based on reporting segment, product category and geographic region. We design, develop, manufacture and market medical products for interventional, diagnostic and therapeutic procedures. For financial reporting purposes, we report our operations in two operating segments: cardiovascular and endoscopy. Our cardiovascular segment consists of four product categories: peripheral intervention, cardiac intervention, custom procedural solutions, and original equipment manufacturer (“OEM”). Within these product categories, we sell a variety of products, including cardiology and radiology devices (which assist in diagnosing and treating coronary arterial disease, peripheral vascular disease and other non-vascular diseases), as well as embolotherapeutic, cardiac rhythm management, electrophysiology, critical care, breast cancer localization and guidance, biopsy, and interventional oncology and spine devices. Our endoscopy segment consists of gastroenterology and pulmonology devices which assist in the palliative treatment of expanding esophageal, tracheobronchial and biliary strictures. The following table presents revenue from contracts with customers by reporting segment, product category and geographic region for the three and six-month periods ended June 30, 2024 and 2023 (in thousands): Three Months Ended Three Months Ended June 30, 2024 June 30, 2023 United States International Total United States International Total Cardiovascular Peripheral Intervention $ 82,356 $ 56,891 $ 139,247 $ 71,973 $ 53,936 $ 125,909 Cardiac Intervention 36,840 57,023 93,863 35,690 58,085 93,775 Custom Procedural Solutions 30,496 19,920 50,416 29,155 20,229 49,384 OEM 35,460 8,829 44,289 34,570 7,637 42,207 Total 185,152 142,663 327,815 171,388 139,887 311,275 Endoscopy Endoscopy Devices 9,512 676 10,188 8,194 587 8,781 Total $ 194,664 $ 143,339 $ 338,003 $ 179,582 $ 140,474 $ 320,056 Six Months Ended Six Months Ended June 30, 2024 June 30, 2023 United States International Total United States International Total Cardiovascular Peripheral Intervention $ 161,615 $ 112,258 $ 273,873 $ 140,640 $ 99,052 $ 239,692 Cardiac Intervention 72,183 112,368 184,551 69,995 109,108 179,103 Custom Procedural Solutions 59,790 39,420 99,210 55,954 41,131 97,085 OEM 68,109 15,446 83,555 67,134 16,237 83,371 Total 361,697 279,492 641,189 333,723 265,528 599,251 Endoscopy Endoscopy Devices 19,061 1,261 20,322 17,219 1,151 18,370 Total $ 380,758 $ 280,753 $ 661,511 $ 350,942 $ 266,679 $ 617,621 |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2024 | |
Business Combinations [Abstract] | |
Acquisitions | 4. Acquisitions and Investments. On May 17, 2024, Merit Medical Ireland Limited (“MM Ireland”), our indirect wholly-owned subsidiary, entered into a Subscription and Shareholder Agreement (the “CrannMed Agreement”) with CrannMed Limited, a company organized under the laws of Ireland (“CrannMed”). Pursuant to the terms of the CrannMed Agreement, MM Ireland paid €3.0 million to purchase preferred shares of CrannMed. At CrannMed’s election at any time after August 16, 2024, MM Ireland is obligated to pay an additional €3.0 million to acquire additional preferred shares of CrannMed, subject to certain conditions (the “Second Tranche Investment”). Additionally, upon the request of CrannMed and subject to the completion of the Second Tranche Investment and other conditions, MM Ireland may pay to CrannMed up to an additional €2.0 million in the form of equity, debt or other investment for the purpose of funding clinical trial activities of CrannMed. MM Ireland’s investment in CrannMed has been recorded as an equity investment accounted for at cost and reflected within other assets in the accompanying consolidated balance sheets because MM Ireland is not able to exercise significant influence over the operations of CrannMed. MM Ireland’s total current investment in CrannMed represented an ownership interest of approximately 10.8% of the outstanding capital stock of CrannMed at the date of the initial purchase. On March 8, 2024, we entered into an asset purchase agreement with Scholten Surgical Instruments, Inc. (“SSI”) to acquire the assets associated with the Bioptome, Novatome, and Sensatome devices. The total purchase price of the SSI assets included an up-front payment of $3 million, and three deferred payments, including (i) $1 million payable upon the earlier of (a) the first anniversary of the closing date or (b) the date on which Merit can independently manufacture the purchased devices (“Deferred Payment Date”), (ii) $1 million payable upon the first anniversary of the Deferred Payment Date, and (iii) $1 million payable upon the second anniversary of the Deferred Payment Date. We have accounted for this transaction as an asset purchase, and recorded the amount paid and deferred payments as a developed technology intangible asset, which we are amortizing over eight years . During March 2024, we paid $0.3 million to acquire additional Series A Preferred Stock of Fluidx Medical Technology, Inc. ("Fluidx"), owner of certain technology proposed to be used in the development of embolic and adhesive agents for use in arterial, venous, vascular graft and cardiovascular applications inside and outside the heart and related appendages. We had previously purchased and continue to hold $4.7 million of participating preferred shares of Fluidx. Our investment has been recorded as an equity investment accounted for at cost and reflected within other assets in the accompanying consolidated balance sheets because we are not able to exercise significant influence over the operations of Fluidx. Our total current investment in Fluidx represented an ownership interest of approximately 19.9% of the outstanding capital stock of Fluidx at the date of this investment. On June 8, 2023, we entered into an asset purchase agreement with AngioDynamics, Inc. (“AngioDynamics”) to acquire the assets associated with a portfolio of dialysis catheter products and the BioSentry® Biopsy Tract Sealant System for a purchase price of $100 million. We accounted for this transaction under the acquisition method of accounting as a business combination. The sales related to the acquisition have been included in our cardiovascular segment since the acquisition date and were $11.6 million and $0.9 million for the six-month periods ended June 30, 2024 and 2023, respectively. It is not practical to separately report earnings related to the acquisition, as we began to immediately integrate the acquisition into the existing operations, sales distribution networks and management structure of our cardiovascular business segment. Acquisition-related costs associated with the AngioDynamics acquisition, which were included in selling, general and administrative expenses in the consolidated statements of income included in the 2023 Annual Report on Form 10-K, were approximately $4.9 million. The purchase price was allocated as follows (in thousands) : Assets Acquired Prepaid expenses $ 2,000 Inventories 5,254 Property and equipment 108 Intangible assets Developed technology 65,200 Trademarks 4,000 Customer list 5,800 Goodwill 17,638 Total net assets acquired $ 100,000 We are amortizing the AngioDynamics developed technology intangible assets over ten years, the trademark intangible assets over 11 years, and the customer list intangible asset on an accelerated basis over ten years. We have estimated the weighted average life of the intangible assets acquired from AngioDynamics to be 10.5 years. impracticable to obtain information to determine earnings associated with the acquired product lines which represent only a small portion of the product lines of a large, consolidated company without standalone financial information. On May 4, 2023, we entered into an asset purchase agreement to acquire the assets associated with the Surfacer® Inside-Out® Access Catheter System from Bluegrass Vascular Technologies, Inc. (“Bluegrass”), for a purchase price of $32.7 million. Prior to the acquisition, we held an equity investment of 1,251,878 Bluegrass common shares, representing an approximately 19.5% ownership interest in Bluegrass. The fair value of this previously-held equity investment of approximately $245,000 is included in the purchase price allocation. We accounted for this transaction under the acquisition method of accounting as a business combination. The sales and results of operations related to the acquisition have been included in our cardiovascular segment since the acquisition date and were not material. Acquisition-related costs associated with the Bluegrass acquisition, which were included in selling, general and administrative expenses in the consolidated statements of income included in the 2023 Annual Report on Form 10-K, were not material. The purchase price was allocated as follows (in thousands): Assets Acquired Inventories $ 175 Intangible assets Developed technology 28,000 Trademarks 900 Goodwill 3,898 Total net assets acquired $ 32,973 We are amortizing the Bluegrass developed technology intangible asset over 15 years and the related trademarks over 13 years. We have estimated the weighted average life of the intangible assets acquired from Bluegrass to be 14.9 years. |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2024 | |
Inventory Disclosure [Abstract] | |
Inventories | 5. Inventories. Inventories at June 30, 2024 and December 31, 2023 consisted of the following (in thousands): June 30, 2024 December 31, 2023 Finished goods $ 152,180 $ 158,893 Work-in-process 38,049 25,420 Raw materials 107,995 119,558 Total inventories $ 298,224 $ 303,871 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 6. Goodwill and Intangible Assets. The change in the carrying amount of goodwill for the six-month period ended June 30, 2024 is detailed as follows (in thousands): 2024 Goodwill balance at January 1 $ 382,240 Effect of foreign exchange (807) Goodwill balance at June 30 $ 381,433 Total accumulated goodwill impairment losses aggregated to $8.3 million as of June 30, 2024 and December 31, 2023, respectively. We did not have any goodwill impairments for the six-month periods ended June 30, 2024 or 2023. The total goodwill balances as of June 30, 2024 and December 31, 2023 were related to our cardiovascular segment. Other intangible assets at June 30, 2024 and December 31, 2023 consisted of the following (in thousands): June 30, 2024 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Patents $ 30,163 $ (11,876) $ 18,287 Distribution agreements 3,250 (2,956) 294 License agreements 11,094 (8,759) 2,335 Trademarks 35,123 (22,343) 12,780 Customer lists 40,225 (34,694) 5,531 Total $ 119,855 $ (80,628) $ 39,227 December 31, 2023 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Patents $ 28,877 $ (10,916) $ 17,961 Distribution agreements 3,250 (2,919) 331 License agreements 11,142 (8,327) 2,815 Trademarks 35,135 (20,804) 14,331 Customer lists 40,367 (33,921) 6,446 Total $ 118,771 $ (76,887) $ 41,884 Aggregate amortization expense for the three and six-month periods ended June 30, 2024 was $14.8 million and $29.4 million, respectively. Aggregate amortization expense for the three and six-month periods ended June 30, 2023 was $13.4 million and $25.7 million, respectively. We evaluate long-lived assets, including amortizing intangible assets, for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. We perform the impairment analysis at the asset group for which the lowest level of identifiable cash flows is largely independent of the cash flows of other assets and liabilities. We determine the fair value of our amortizing assets based on estimated future cash flows discounted back to their present value using a discount rate that reflects the risk profiles of the underlying activities. Estimated amortization expense for developed technology and other intangible assets for the next five years consisted of the following as of June 30, 2024 (in thousands): Estimated Amortization Expense Remaining 2024 $ 31,367 2025 60,826 2026 49,776 2027 46,440 2028 45,024 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 7. Income Taxes. The Organization for Economic Cooperation and Development (“OECD”) Pillar Two global minimum tax rules, which generally provide for a minimum effective tax rate of 15%, are intended to apply for tax years beginning in 2024. On February 2, 2023, the OECD issued administrative guidance providing transition and safe harbor rules around the implementation of the Pillar Two global minimum tax. Under a transitional safe harbor released July 17, 2023, the undertaxed profits rule top-up tax in the jurisdiction of a company's ultimate parent entity will be zero for each fiscal year of the transition period, if that jurisdiction has a corporate tax rate of at least 20%. The safe harbor transition period will apply to fiscal years beginning on or before December 31, 2025 and ending before December 31, 2026. While we expect our effective income tax rate and cash income tax payments could increase in future years as a result of the global minimum tax, we do not anticipate a material impact to our fiscal 2024 consolidated results of operations. Our assessment could be affected by legislative guidance and future enactment of additional provisions within the Pillar Two framework. We are closely monitoring developments and evaluating the impact these new rules are anticipated to have on our tax rate, including eligibility to qualify for these safe harbor rules. |
Debt
Debt | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Debt | 8. Debt. Principal balances outstanding under our long-term debt obligations as of June 30, 2024 and December 31, 2023 consisted of the following (in thousands): June 30, 2024 December 31, 2023 Term loans $ 75,000 $ 99,063 Convertible notes 747,500 747,500 Less unamortized debt issuance costs (21,179) (23,550) Total long-term debt 801,321 823,013 Less current portion — — Long-term portion $ 801,321 $ 823,013 Future minimum principal payments on our long-term debt, as of June 30, 2024, were as follows (in thousands): Years Ending Future Minimum December 31, Principal Payments Remaining 2024 $ — 2025 — 2026 — 2027 — 2028 75,000 Thereafter 747,500 Total future minimum principal payments $ 822,500 Fourth Amended and Restated Credit Agreement On June 6, 2023, we entered into a Fourth Amended and Restated Credit Agreement (the "Fourth A&R Credit Agreement"). The Fourth A&R Credit Agreement is a syndicated loan agreement with Wells Fargo Bank, National Association and other parties. The Fourth A&R Credit Agreement amended and restated in its entirety our previously outstanding Third Amended and Restated Credit Agreement and all amendments thereto. The Fourth A&R Credit Agreement provides for a term loan of $150 million and a revolving credit commitment of up to an aggregate amount of $700 million, inclusive of sub-facilities for multicurrency borrowings, standby letters of credit and swingline loans. On June 6, 2028, all principal, interest and other amounts outstanding under the Fourth Amended Credit Agreement are payable in full. At any time prior to the maturity date, we may repay any amounts owing under all term loans and revolving credit loans in whole or in part, without premium or penalty. On December 5, 2023, we executed an amendment to the Fourth Amended Credit Agreement (as amended, the "Amended Fourth A&R Credit Agreement") to facilitate the issuance of our Convertible Notes described below. Among other things, the amendment also updated the definition of the “Applicable Margin” as used in the Amended Fourth A&R Credit Agreement to determine the interest rates and amended the financial covenants, all as described below. Term loans made under the Amended Fourth A&R Credit Agreement bear interest, at our election, at either (i) the Base Rate plus the Applicable Margin (as defined in the Amended Fourth A&R Credit Agreement) or, (ii) Adjusted Term SOFR plus the Applicable Margin (as defined in the Amended Fourth A&R Credit Agreement). Revolving credit loans bear interest, at our election, at either (a) the Base Rate plus the Applicable Margin, (b) Adjusted Term SOFR plus the Applicable Margin, (c) Adjusted Eurocurrency Rate plus the Applicable Margin (as defined in the Amended Fourth A&R Credit Agreement), or (d) Adjusted Daily Simple SONIA plus the Applicable Margin (as defined in the Amended Fourth A&R Credit Agreement). Swingline loans bear interest at the Base Rate plus the Applicable Margin. Interest on each loan featuring the Base Rate and each Daily Simple SONIA Loan is due and payable on the last business day of each calendar month; interest on each loan featuring the Eurocurrency Rate and each Term SOFR Loan is due and payable on the last day of each interest period applicable thereto, and if such interest period extends over three months, at the end of each three-month interval during such interest period. The Amended Fourth A&R Credit Agreement is collateralized by substantially all of our assets. The Amended Fourth A&R Credit Agreement contains affirmative and negative covenants, representations and warranties, events of default and other terms customary for loans of this nature. In particular, the Amended Fourth A&R Credit Agreement requires that we maintain certain financial covenants, as follows: Covenant Requirement Consolidated Total Net Leverage Ratio (1) 5.0 to 1.0 Consolidated Senior Secured Net Leverage Ratio (2) 3.0 to 1.0 Consolidated Interest Coverage Ratio (3) 3.0 to 1.0 (1) Maximum Consolidated Total Net Leverage Ratio (as defined in the Amended Fourth A&R Credit Agreement) as of any fiscal quarter end. (2) Maximum Consolidated Senior Secured Net Leverage Ratio (as defined in the Amended Fourth A&R Credit Agreement) as of any fiscal quarter end. (3) Minimum ratio of Consolidated EBITDA (as defined in the Amended Fourth A&R Credit Agreement and adjusted for certain expenditures) to Consolidated Interest Expense (as defined in the Amended Fourth A&R Credit Agreement) for any period of four consecutive fiscal quarters. We believe we were in compliance with all covenants set forth in the Amended Fourth A&R Credit Agreement as of June 30, 2024. As of June 30, 2024, we had outstanding borrowings of $75.0 million and issued letter of credit guarantees of $2.4 million under the Amended Fourth A&R Credit Agreement, with additional available borrowings of approximately $680 million, based on the maximum net leverage ratio and the aggregate revolving credit commitment pursuant to the Amended Fourth A&R Credit Agreement. Our interest rate as of June 30, 2024 was a fixed rate of 3.39% with respect to the outstanding principal amount as a result of an interest rate swap (see Note 9). Our interest rate as of December 31, 2023 was a fixed rate of 3.39% on $75 million as a result of an interest rate swap and a variable floating rate of 7.21% on $24.1 million. The foregoing fixed rates do not reflect potential future changes in the Applicable Margin. Convertible Notes In December 2023, we issued convertible notes which bear interest at 3.00% per year, payable semi-annually in arrears on February 1 and August 1 of each year, beginning on August 1, 2024 (the “Convertible Notes”). The Convertible Notes are senior unsecured obligations (as defined in the indenture governing the Convertible Notes (the “Indenture”)) of Merit and will mature on February 1, 2029, unless repurchased, redeemed or converted in accordance with their terms prior to such date. The net proceeds from the sale of the Convertible Notes were approximately $724.8 million after deducting offering and issuance costs and before the costs of the Capped Call Transactions, as described below. The initial conversion rate of the notes will be 11.5171 shares of our common stock (the “Common Stock”) per $1,000 principal amount of notes, which equates to an initial conversion price of approximately $86.83 per share of Common Stock, subject to adjustments as provided in the Indenture upon the occurrence of certain specified events. In addition, (as defined in the Indenture) Conversion can occur at the option of the Holders at any time on or after October 1, 2028. Prior to October 1, 2028, Holders may only elect to convert the Convertible Notes under the following circumstances: (1) During the five ten 10 20 30 On or after February 7, 2027, we may redeem for cash all or part of the Convertible Notes, at our option, if the last reported sales price of Common Stock has been at least 130% of the conversion price then in effect for at least 20 30 Upon conversion, Merit will (1) pay cash up to the aggregate principal amount of the Convertible Notes to be converted and (2) pay or deliver, as the case may be, cash, shares of Common Stock, or a combination of cash and shares of Common Stock, at Merit’s election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the Convertible Notes being converted. Capped Call Transactions In December 2023, in connection with the pricing of the Convertible Notes, Merit entered into privately negotiated capped call transactions (“Capped Call Transactions”) with certain of the initial purchasers and/or their respective affiliates and certain other financial institutions. The Capped Call Transactions cover, subject to customary anti-dilution adjustments, the number of shares of Common Stock initially underlying the Convertible Notes and are generally expected to reduce potential dilution to the Common Stock upon any conversion of Convertible Notes and/or offset any cash payments Merit is required to make in excess of the principal amount of converted Convertible Notes, as the case may be, with such reduction and/or offset subject to a cap, based on a cap price initially equal to approximately $114.68 per share of Common Stock, subject to certain adjustments under the terms of the Capped Call Transactions. The cost of the Capped Call Transactions was approximately $66.5 million. The Capped Call Transactions do not meet the criteria for separate accounting as a derivative as they are indexed to the Common Stock. The premiums paid for the Capped Call Transactions have been included as a net reduction to Common Stock within stockholders' equity. |
Derivatives
Derivatives | 6 Months Ended |
Jun. 30, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | 9. Derivatives. General. We formally document, designate and assess the effectiveness of transactions that receive hedge accounting treatment initially and on an ongoing basis. For qualifying hedges, the change in fair value is deferred in accumulated other comprehensive income, a component of stockholders’ equity in the accompanying consolidated balance sheets, and recognized in earnings at the same time the hedged item affects earnings. Changes in the fair value of derivative instruments not designated as hedging instruments are recorded in earnings throughout the term of the derivative. Interest Rate Risk. Derivatives Designated as Cash Flow Hedges On December 23, 2019, we entered into a pay-fixed, receive-variable interest rate swap with a notional amount of $75 million with Wells Fargo. In June 2023, certain terms under the swap agreement were amended to reflect the transition from LIBOR to SOFR, an alternative reference rate. Under the interest rate swap agreement, we fixed the one-month On June 30, 2024 and December 31, 2023, our interest rate swap qualified as a cash flow hedge. The fair value of our interest rate swap as of June 30, 2024 was an asset of $0.3 million, which was partially offset by $0.1 million in deferred taxes. The fair value of our interest rate swap as of December 31, 2023 was an asset of $1.5 million, partially offset by $0.4 million in deferred taxes. Foreign Currency Risk. Derivatives Designated as Cash Flow Hedges For derivative instruments that are designated and qualify as cash flow hedges, the gain or loss on the derivative instrument is temporarily reported as a component of other comprehensive income and then reclassified into earnings in the same line item associated with the forecasted transaction and in the same period or periods during which the hedged transaction affects earnings. We entered into forward contracts on various foreign currencies to manage the risk associated with forecasted exchange rates which impact revenues, cost of sales, and operating expenses in various international markets. The objective of the forward contracts is to reduce the variability of cash flows associated with the forecasted purchase or sale of the foreign currencies. As of June 30, 2024 and December 31, 2023, we had entered into foreign currency forward contracts, which qualified as cash flow hedges, with aggregate notional amounts of $134.0 million and $141.1 million, respectively. Derivatives Not Designated as Cash Flow Hedges We forecast our net exposure in various receivables and payables to fluctuations in the value of various currencies, and we enter into foreign currency forward contracts to mitigate that exposure. As of June 30, 2024 and December 31, 2023, we had entered into foreign currency forward contracts related to those balance sheet accounts with aggregate notional amounts of $110.8 million and $108.4 million, respectively. Balance Sheet Presentation of Derivative Instruments. The fair value of derivative instruments on a gross basis was as follows on the dates indicated (in thousands): Fair Value of Derivative Instruments Designated as Hedging Instruments Balance Sheet Location June 30, 2024 December 31, 2023 Assets Interest rate swap Prepaid expenses and other assets $ 254 $ 1,503 Foreign currency forward contracts Prepaid expenses and other assets 2,877 2,061 Foreign currency forward contracts Other assets (long-term) 497 216 (Liabilities) Foreign currency forward contracts Accrued expenses (954) (1,898) Foreign currency forward contracts Other long-term obligations (343) (499) Fair Value of Derivative Instruments Not Designated as Hedging Instruments Balance Sheet Location June 30, 2024 December 31, 2023 Assets Foreign currency forward contracts Prepaid expenses and other assets $ 1,572 $ 828 (Liabilities) Foreign currency forward contracts Accrued expenses (953) (1,463) Income Statement Presentation of Derivative Instruments. Derivative Instruments Designated as Cash Flow Hedges Derivative instruments designated as cash flow hedges had the following effects, before income taxes, on other comprehensive income (“OCI”), accumulated other comprehensive income (“AOCI”), and net earnings in our consolidated statements of income, consolidated statements of comprehensive income and consolidated balance sheets (in thousands): Amount of Gain/(Loss) Consolidated Statements Amount of Gain/(Loss) Recognized in OCI of Income Reclassified from AOCI Three Months Ended June 30, Three Months Ended June 30, Three Months Ended June 30, Derivative instrument 2024 2023 Location in statements of income 2024 2023 2024 2023 Interest rate swap $ (197) $ 719 Interest expense $ (7,679) $ (3,682) $ 699 $ 631 Foreign currency forward contracts (31) 4,325 Revenue 338,003 320,056 427 658 Cost of sales (176,903) (167,274) 357 333 Amount of Gain/(Loss) Consolidated Statements Amount of Gain/(Loss) Recognized in OCI of Income Reclassified from AOCI Six Months Ended June 30, Six Months Ended June 30, Six Months Ended June 30, Derivative instrument 2024 2023 Location in statements of income 2024 2023 2024 2023 Interest rate swap $ 151 $ 600 Interest expense $ (15,725) $ (5,693) $ 1,401 $ 1,165 Foreign currency forward contracts 4,135 4,564 Revenue 661,511 617,621 840 1,985 Cost of sales (348,696) (326,477) 784 283 As of June 30, 2024, $2.9 million, or $2.2 million after taxes, was expected to be reclassified from AOCI to earnings in revenue and cost of sales over the succeeding twelve months. As of June 30, 2024, $0.3 million, or $0.2 million after taxes, was expected to be reclassified from AOCI to earnings in interest expense over the succeeding twelve months. Derivative Instruments Not Designated as Hedging Instruments The following gains/(losses) from these derivative instruments were recognized in our consolidated statements of income for the periods presented (in thousands): Three Months Ended June 30, Six Months Ended June 30, Derivative Instrument Location in statements of income 2024 2023 2024 2023 Foreign currency forward contracts Other income (expense) — net $ 645 $ 2,141 $ 1,528 $ 3,200 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. Commitments and Contingencies. Litigation. hese proceedings, actions and claims may involve product liability, intellectual property, contract disputes, employment, governmental inquiries or other matters, including the matter described below. These matters generally involve inherent uncertainties and often require prolonged periods of time to resolve. In certain proceedings, the claimants may seek damages, as well as other compensatory and equitable relief that could result in the payment of significant claims and settlements and/or the imposition of injunctions or other equitable relief. For legal matters for which our management had sufficient information to reasonably estimate our future obligations, a liability representing management’s best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within the range is not known, is recorded. The estimates are based on consultation with legal counsel, previous settlement experience and settlement strategies. If actual outcomes are less favorable than those estimated by management, additional expense may be incurred, which could unfavorably affect our financial position, results of operations and cash flows. The ultimate cost to us with respect to SEC Inquiry We have received requests from the Division of Enforcement of the U.S. Securities and Exchange Commission (“SEC”) seeking the voluntary production of information relating to the business activities of Merit’s subsidiary in China, including interactions with hospitals and health care officials in China (the “SEC Inquiry”). We are cooperating with the requests and investigating the matter. Currently, we are unable to predict the scope, timing, significance or outcome of the SEC Inquiry or estimate a reasonably possible loss or range of loss associated with the matter. It is possible that the ultimate resolution of the SEC Inquiry, if resolved in a manner unfavorable to us, may be materially adverse to our business, financial position, results of operations or liquidity. In management's opinion, based on its examination of these matters, its experience to date and discussions with counsel, other than the SEC Inquiry, we are not currently involved in any legal proceedings which, individually or in the aggregate, could have a material adverse effect on our financial position, results of operations or cash flows. Our management regularly assesses the risks of legal proceedings in which we are involved, and management’s view of these matters may change in the future. |
Earnings Per Common Share (EPS)
Earnings Per Common Share (EPS) | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share (EPS) | 11. Earnings Per Common Share (EPS). The computation of weighted average shares outstanding and the basic and diluted earnings per common share for the three and six-month periods ended June 30, 2024 and 2023 consisted of the following (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Net income $ 35,726 $ 20,245 $ 63,966 $ 40,948 Average common shares outstanding 58,139 57,537 58,049 57,445 Basic EPS $ 0.61 $ 0.35 $ 1.10 $ 0.71 Average common shares outstanding 58,139 57,537 58,049 57,445 Effect of dilutive stock awards 601 936 604 884 Total potential shares outstanding 58,740 58,473 58,653 58,329 Diluted EPS $ 0.61 $ 0.35 $ 1.09 $ 0.70 Equity awards excluded as the impact was anti-dilutive (1) 802 1,114 1,009 1,014 (1) Does not reflect the impact of incremental repurchases under the treasury stock method. Convertible Notes For our Convertible Notes, the dilutive effect is calculated using the if-converted method. Upon surrender of the Convertible Notes for conversion, Merit will pay cash up to the aggregate principal amount of the Notes to be converted and pay or deliver, as the case may be, cash, shares of Common Stock or a combination of cash and shares of Common Stock, at Merit’s election, in respect of the remainder, if any, of Merit’s conversion obligation in excess of the aggregate principal amount of the Convertible Notes being converted. |
Stock-Based Compensation Expens
Stock-Based Compensation Expense | 6 Months Ended |
Jun. 30, 2024 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation Expense | 12. Stock-Based Compensation Expense. Stock-based compensation expense before income tax expense for the three and six-month periods ended June 30, 2024 and 2023 consisted of the following (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Cost of sales Nonqualified stock options $ 363 $ 432 $ 725 $ 873 Research and development Nonqualified stock options 345 413 781 841 Selling, general and administrative Nonqualified stock options 1,565 1,851 3,247 3,221 Performance-based restricted stock units 2,897 1,817 4,764 2,632 Restricted stock units 1,131 467 1,718 911 Cash-settled performance-based awards 710 600 1,010 1,071 Total selling, general and administrative 6,303 4,735 10,739 7,835 Stock-based compensation expense before taxes $ 7,011 $ 5,580 $ 12,245 $ 9,549 We recognize stock-based compensation expense (net of a forfeiture rate), for those awards which are expected to vest, on a straight-line basis over the requisite service period. We estimate the forfeiture rate based on our historical experience and expectations about future forfeitures. Nonqualified Stock Options During the six-month period ended June 30, 2023, we granted stock options representing 327,294 shares of our Common Stock. We did not grant any stock options during the six-month period ended June 30, 2024. We use the Black-Scholes methodology to value the stock-based compensation expense for options. In applying the Black-Scholes methodology to the option grants, the fair value of our stock-based awards granted was estimated using the following assumptions for the periods indicated below: Six Months Ended June 30, 2023 Risk-free interest rate 3.6% - 4.5% Expected option term 4.0 years Expected dividend yield — Expected price volatility 46.7% - 47.1% The average risk-free interest rate is determined using the U.S. Treasury rate in effect as of the date of grant, based on the expected term of the stock award. We determine the expected term of stock options using the historical exercise behavior of employees. The expected price volatility was determined using a weighted average of daily historical volatility of our stock price over the corresponding expected option term and implied volatility based on recent trends of the daily historical volatility. For awards with a vesting period, compensation expense is recognized on a straight-line basis over the service period, which corresponds to the vesting period. As of June 30, 2024, the total remaining unrecognized compensation cost related to non-vested stock options was $15.4 million, which was expected to be recognized over a weighted average period of 2.0 years. Stock-Settled Performance-Based Restricted Stock Units (“Performance Stock Units”) During the six-month periods ended June 30, 2024 and 2023, we granted performance stock units which represented up to 364,810 and 286,863 shares of Common Stock, respectively. Conversion of the performance stock units occurs at the end of the relevant performance periods, or one year after the agreement date, whichever is later. The number of shares delivered upon vesting at the end of the performance periods are based upon performance against specified financial performance metrics and relative total shareholder return as compared to the Russell 2000 Index (“rTSR”), as defined in the award agreements. We use Monte-Carlo simulations to estimate the grant-date fair value of the performance stock units linked to total shareholder return. The fair value of each performance stock unit was estimated as of the grant date using the following assumptions for awards granted in the periods indicated below: Six Months Ended June 30, 2024 2023 Risk-free interest rate 4.4% 3.9% - 4.6% Performance period 2.8 years 2.8 years Expected dividend yield — — Expected price volatility 31.1% 31.4% - 32.6% The risk-free interest rate of return was determined using the U.S. Treasury rate at the time of grant with a term equal to the expected term of the award. The expected volatility was based on the weighted average volatility of our stock price and the average volatility of our compensation peer group's stock price. The expected dividend yield was assumed to be zero because, at the time of the grant, we had no plans to declare a dividend. Compensation expense is recognized using the grant-date fair value for the number of shares that are likely to be awarded based on the performance metrics. Each reporting period, this probability assessment is updated, and cumulative adjustments are recorded based on the financial performance metrics expected to be achieved. At the end of the performance period, cumulative expense is calculated based on the actual performance metrics achieved. As of June 30, 2024, the total remaining unrecognized compensation cost related to stock-settled performance stock units was $20.3 million, which is expected to be recognized over a weighted average period of 2.1 years. Cash-Settled Performance-Based Awards During the six-month periods ended June 30, 2024 and 2023, we granted performance stock units to our Chief Executive Officer that provide for settlement in cash upon achievement of specific metrics (“Liability Awards”), with total target cash incentives in the amount of $1.6 million and $1.3 million, respectively. The Liability Awards entitle him to a target cash payment based upon our level of rTSR performance and achievement of other performance metrics, as defined in the award agreements. During the six-month periods ended June 30, 2024 and 2023, we granted additional performance stock units to certain employees that provide for settlement in cash upon our achievement of specified financial metrics. The cash payable upon vesting at the end of the service period is based upon performance against specified financial performance metrics and relative total shareholder return as compared to the rTSR, as defined in the award agreements. Compensation expense is recognized for the cash payment likely to be awarded based on the performance metrics. The potential maximum payout of these Liability Awards is 250% of the target cash incentive, resulting in a total potential maximum payout of $4.4 million and $4.4 million for Liability Awards granted during the six-month periods ended June 30, 2024 and 2023, respectively. The settlement generally occurs at the end of three-year performance periods based upon the same performance metrics and vesting period as our performance stock units. The fair value of these Liability Awards is measured at each reporting period until the awards are settled. As of June 30, 2024 and December 31, 2023, the recorded balance associated with these Liability Awards is $3.4 million and $3.4 million, respectively, which are classified as liabilities and reported in accrued expenses and other long-term obligations within our consolidated balance sheets. As of June 30, 2024, the total remaining unrecognized compensation cost related to Liability Awards was $4.4 million, which is expected to be recognized over a weighted average period of 2.0 years. Restricted Stock Units During the six-month periods ended June 30, 2024 and 2023, we granted restricted stock units to certain employees and and non-employee directors representing 158,719 and 20,358 shares of Common Stock, respectively. The expense recognized for restricted stock units is equal to the closing stock price on the date of grant, which is recognized over the vesting period. Restricted stock units granted to each employee are subject to such employee’s continued employment through the vesting date, which is four years from the date of grant. Restricted stock units granted to each non-employee director are subject to such director’s continued service through the vesting date, which is one year from the grant date. As of June 30, 2024, the total remaining unrecognized compensation cost related to restricted stock units was $10.2 million, which will be recognized over a weighted average period of 3.3 years. |
Segment Reporting
Segment Reporting | 6 Months Ended |
Jun. 30, 2024 | |
Segment Reporting [Abstract] | |
Segment Reporting | 13. Segment Reporting. We report our operations in two operating segments: cardiovascular and endoscopy. Our cardiovascular segment consists of four product categories: peripheral intervention, cardiac intervention, custom procedural solutions, and OEM. Within these product categories, we sell a variety of products, including cardiology and radiology devices (which assist in diagnosing and treating coronary arterial disease, peripheral vascular disease and other non-vascular diseases), as well as embolotherapeutic, cardiac rhythm management, electrophysiology, critical care, breast cancer localization and guidance, biopsy, and interventional oncology and spine devices. Our endoscopy segment consists of gastroenterology and pulmonology devices which assist in the palliative treatment of expanding esophageal, tracheobronchial and biliary strictures. Our chief operating decision maker is our Chief Executive Officer. We evaluate the performance of our operating segments based on net sales and income from operations. Financial information relating to our reportable operating segments and reconciliations to the consolidated totals for the three and six-month periods ended June 30, 2024 and 2023, were as follows (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Net sales Cardiovascular $ 327,815 $ 311,275 $ 641,189 $ 599,251 Endoscopy 10,188 8,781 20,322 18,370 Total net sales 338,003 320,056 661,511 617,621 Income from operations Cardiovascular 42,912 26,464 75,819 50,398 Endoscopy 3,034 2,348 6,049 4,797 Total income from operations 45,946 28,812 81,868 55,195 Total other expense — net (103) (3,912) (1,677) (4,795) Income tax expense 10,117 4,655 16,225 9,452 Net income $ 35,726 $ 20,245 $ 63,966 $ 40,948 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 14. Fair Value Measurements. Assets (Liabilities) Measured at Fair Value on a Recurring Basis Our financial assets and (liabilities) carried at fair value and measured on a recurring basis as of June 30, 2024 and December 31, 2023 consisted of the following (in thousands): Fair Value Measurements Using Total Fair Quoted prices in Significant other Significant Value at active markets observable inputs unobservable inputs June 30, 2024 (Level 1) (Level 2) (Level 3) Marketable securities (1) $ 61 $ 61 $ — $ — Interest rate contract asset, current (2) $ 254 $ — $ 254 $ — Foreign currency contract assets, current and long-term (3) $ 4,946 $ — $ 4,946 $ — Foreign currency contract liabilities, current and long-term (4) $ (2,250) $ — $ (2,250) $ — Contingent consideration liabilities $ (3,435) $ — $ — $ (3,435) Fair Value Measurements Using Total Fair Quoted prices in Significant other Significant Value at active markets observable inputs unobservable inputs December 31, 2023 (Level 1) (Level 2) (Level 3) Marketable securities (1) $ 78 $ 78 $ — — Interest rate contract asset, current (2) $ 1,503 $ — $ 1,503 $ — Foreign currency contract assets, current and long-term (3) $ 3,105 $ — $ 3,105 $ — Foreign currency contract liabilities, current and long-term (4) $ (3,860) $ — $ (3,860) $ — Contingent consideration liabilities $ (3,447) $ — $ — $ (3,447) (1) Our marketable securities, which consist entirely of available-for-sale equity securities, are valued using market prices in active markets. Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. (2) The fair value of the interest rate contract is determined using Level 2 fair value inputs and is recorded as prepaid and other current assets in the consolidated balance sheets. (3) The fair value of the foreign currency contract assets (including those designated as hedging instruments and those not designated as hedging instruments) is determined using Level 2 fair value inputs and is recorded as a prepaid expense and other current asset or other long-term asset in the consolidated balance sheets. (4) The fair value of the foreign currency contract liabilities (including those designated as hedging instruments and those not designated as hedging instruments) is determined using Level 2 fair value inputs and is recorded as accrued expense or other long-term obligation in the consolidated balance sheets. Certain of our past business combinations involve the potential for the payment of future contingent consideration, generally based on a percentage of future product sales or upon attaining specified future revenue or other milestones. The contingent consideration liability is re-measured at the estimated fair value at the end of each reporting period with the change in fair value recognized within operating expenses in the accompanying consolidated statements of income for such period. We measure the initial liability and re-measure the liability on a recurring basis using Level 3 inputs as defined under authoritative guidance for fair value measurements. Changes in the fair value of our contingent consideration liabilities during the three and six-month periods ended June 30, 2024 and 2023 consisted of the following (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Beginning balance $ 3,225 $ 16,000 $ 3,447 $ 18,073 Contingent consideration expense 305 1,094 188 1,615 Contingent payments made (95) (13,513) (200) (16,107) Ending balance $ 3,435 $ 3,581 $ 3,435 $ 3,581 As of June 30, 2024, $3.0 million in contingent consideration liability was included in other long-term obligations and $0.4 million in contingent consideration liability was included in accrued expenses in our consolidated balance sheet. As of December 31, 2023, $3.0 million in contingent consideration liability was included in other long-term obligations and $0.4 million in contingent consideration liability was included in accrued expenses in our consolidated balance sheet. Payments related to the settlement of the contingent consideration liability recognized at fair value as of the applicable acquisition date of $0.1 million and $3.4 million for the six-month periods ended June 30, 2024 and 2023, respectively, have been reflected as a cash outflow from financing activities in the accompanying consolidated statements of cash flows. Payments related to increases in the contingent consideration liability subsequent to the date of acquisition of $0.1 million and $12.7 million for the six-month periods ended June 30, 2024 and 2023, respectively, are reflected as operating cash flows. The recurring Level 3 measurement of our contingent consideration liabilities included the following significant unobservable inputs at June 30, 2024 and December 31, 2023 (amounts in thousands): Fair value at June 30, Valuation Weighted Contingent consideration liability 2024 technique Unobservable inputs Range Average (1) Revenue-based royalty payments contingent liability $ 2,937 Discounted cash flow Discount rate 12% - 16% 14.6% Projected year of payments 2024-2034 2028 Revenue milestones contingent liability $ 91 Monte Carlo simulation Discount rate 13.0% Projected year of payments 2024-2040 2040 Regulatory approval contingent liability $ 407 Scenario-based method Discount rate 6.1% Probability of milestone payment 50.0% Projected year of payment 2024-2030 2030 Fair value at December 31, Valuation Weighted Contingent consideration liability 2023 technique Unobservable inputs Range Average (1) Revenue-based royalty payments contingent liability $ 2,945 Discounted cash flow Discount rate 12.0% - 16.0% 14.6% Projected year of payments 2024-2034 2028 Revenue milestones contingent liability $ 93 Monte Carlo simulation Discount rate 13.0% Projected year of payments 2024-2039 2039 Regulatory approval contingent liability $ 409 Scenario-based method Discount rate 5.5% Probability of milestone payment 50.0% Projected year of payment 2024-2030 2030 (1) Unobservable inputs were weighted by the relative fair value of the instruments. No weighted average is reported for contingent consideration liabilities without a range of unobservable inputs. The contingent consideration liability is re-measured to fair value each reporting period. Significant increases or decreases in projected revenues, based on our most recent internal operational budgets and long-range strategic plans, discount rates or the time until payment is made would have resulted in a significantly lower or higher fair value measurement. Fair Value of Other Assets (Liabilities) The carrying amount of cash and cash equivalents, receivables, and trade payables approximate fair value because of the immediate, short-term maturity of these financial instruments. Our long-term debt under our Amended Fourth A&R Credit Agreement re-prices frequently due to variable rates and entails no significant changes in credit risk and, as a result, we believe the fair value of long-term debt approximates carrying value. We believe the fair value our long-term debt under our Convertible Notes approximates carrying value as the notes were issued in December 2023. We recognize or disclose the fair value of certain assets, such as non-financial assets, primarily property and equipment, right-of-use operating lease assets, equity investments, intangible assets and goodwill in connection with impairment evaluations. Such assets are reported at carrying value and are not subject to recurring fair value measurements. We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Fair value is generally determined based on discounted future cash flow. All our nonrecurring valuations use significant unobservable inputs and therefore fall under Level 3 of the fair value hierarchy. Our equity investments in privately-held companies were $22.6 million and $19.1 million at June 30, 2024 and December 31, 2023, respectively, which are included within other long-term assets in our consolidated balance sheets. We analyze our investments in privately-held companies to determine if they should be accounted for using the equity method based on our ability to exercise significant influence over operating and financial policies of the investment. Investments not accounted for under the equity method of accounting are accounted for at cost minus impairment, if applicable, plus or minus changes in valuation resulting from observable transactions for identical or similar investments Current Expected Credit Losses Our outstanding long-term notes receivable, including accrued interest and an allowance for current expected credit losses, were $8.7 million and $3.2 million as of June 30, 2024 and December 31, 2023, respectively. Long-term notes receivable issued were $6.2 million for the six-month period ended June 30, 2024 and were related to loans issued to Selio Medical Limited (“Selio”) of $1.7 million, Solo Pace Inc. (“Solo Pace”) of $1.5 million and Fluidx of $3.0 million. As of June 30, 2024 and December 31, 2023, we had an allowance for current expected credit losses of $1.4 million and $0.6 million, respectively, associated with these notes receivable. We assess the allowance for current expected credit losses on an individual security basis, due to the limited number of securities, using a probability of default model, which is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the expected collectability of securities, and other security specific factors. The table below presents a roll-forward of the allowance for current expected credit losses on our notes receivable for the three and six-month periods ended June 30, 2024 and 2023 (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Beginning balance $ 1,388 $ 290 $ 568 $ 281 Provision for credit loss expense 18 6 838 15 Ending balance $ 1,406 $ 296 $ 1,406 $ 296 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 6 Months Ended |
Jun. 30, 2024 | |
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | 15. Accumulated Other Comprehensive Income (Loss). Cash Flow Hedges Foreign Currency Translation Total Balance as of April 1, 2024 $ 3,932 $ (16,388) $ (12,456) Other comprehensive loss (228) (1,688) (1,916) Income taxes 404 22 426 Reclassifications to: Revenue (427) (427) Cost of sales (357) (357) Interest expense (699) (699) Net other comprehensive loss (1,307) (1,666) (2,973) Balance as of June 30, 2024 $ 2,625 $ (18,054) $ (15,429) Cash Flow Hedges Foreign Currency Translation Total Balance as of April 1, 2023 $ 3,081 $ (14,010) $ (10,929) Other comprehensive income (loss) 5,044 (1,201) 3,843 Income taxes (821) (15) (836) Reclassifications to: Revenue (658) (658) Cost of sales (333) (333) Interest expense (631) (631) Net other comprehensive income (loss) 2,601 (1,216) 1,385 Balance as of June 30, 2023 $ 5,682 $ (15,226) $ (9,544) Cash Flow Hedges Foreign Currency Translation Total Balance as of January 1, 2024 $ 1,662 $ (12,996) $ (11,334) Other comprehensive income (loss) 4,286 (5,092) (806) Income taxes (298) 34 (264) Reclassifications to: Revenue (840) (840) Cost of sales (784) (784) Interest expense (1,401) (1,401) Net other comprehensive income (loss) 963 (5,058) (4,095) Balance as of June 30, 2024 $ 2,625 $ (18,054) $ (15,429) Cash Flow Hedges Foreign Currency Translation Total Balance as of January 1, 2023 $ 4,366 $ (15,916) $ (11,550) Other comprehensive income 5,164 724 5,888 Income taxes (415) (34) (449) Reclassifications to: Revenue (1,985) (1,985) Cost of sales (283) (283) Interest expense (1,165) (1,165) Net other comprehensive income 1,316 690 2,006 Balance as of June 30, 2023 $ 5,682 $ (15,226) $ (9,544) |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2024 | |
Subsequent Events [Abstract] | |
Subsequent Events | 16. Subsequent Events. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2024 | Mar. 31, 2024 | Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Pay vs Performance Disclosure | ||||||
Net Income (Loss) | $ 35,726 | $ 28,240 | $ 20,245 | $ 20,703 | $ 63,966 | $ 40,948 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jun. 30, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Basis of Presentation and Oth_2
Basis of Presentation and Other Items (Policies) | 6 Months Ended |
Jun. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Other Items | 1. Basis of Presentation and Other Items. |
Recently Issued Accounting Standards | 2. Recently Issued Accounting Standards. Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures We currently believe there are no other issued and not yet effective accounting standards that are materially relevant to our financial statements. |
Revenue from Contracts with Customers | Revenue from Contracts with Customers. We recognize revenue when a customer obtains control of promised goods. The amount of revenue recognized reflects the consideration we expect to receive in exchange for these goods. Our revenue recognition policies have not changed from those disclosed in Note 1 to our consolidated financial statements in Item 8 of the 2023 Annual Report on Form 10-K. |
Derivatives | Derivatives. General. We formally document, designate and assess the effectiveness of transactions that receive hedge accounting treatment initially and on an ongoing basis. For qualifying hedges, the change in fair value is deferred in accumulated other comprehensive income, a component of stockholders’ equity in the accompanying consolidated balance sheets, and recognized in earnings at the same time the hedged item affects earnings. Changes in the fair value of derivative instruments not designated as hedging instruments are recorded in earnings throughout the term of the derivative. Interest Rate Risk. Derivatives Designated as Cash Flow Hedges On December 23, 2019, we entered into a pay-fixed, receive-variable interest rate swap with a notional amount of $75 million with Wells Fargo. In June 2023, certain terms under the swap agreement were amended to reflect the transition from LIBOR to SOFR, an alternative reference rate. Under the interest rate swap agreement, we fixed the one-month On June 30, 2024 and December 31, 2023, our interest rate swap qualified as a cash flow hedge. The fair value of our interest rate swap as of June 30, 2024 was an asset of $0.3 million, which was partially offset by $0.1 million in deferred taxes. The fair value of our interest rate swap as of December 31, 2023 was an asset of $1.5 million, partially offset by $0.4 million in deferred taxes. Foreign Currency Risk. Derivatives Designated as Cash Flow Hedges Derivatives Not Designated as Cash Flow Hedges Balance Sheet Presentation of Derivative Instruments. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table presents revenue from contracts with customers by reporting segment, product category and geographic region for the three and six-month periods ended June 30, 2024 and 2023 (in thousands): Three Months Ended Three Months Ended June 30, 2024 June 30, 2023 United States International Total United States International Total Cardiovascular Peripheral Intervention $ 82,356 $ 56,891 $ 139,247 $ 71,973 $ 53,936 $ 125,909 Cardiac Intervention 36,840 57,023 93,863 35,690 58,085 93,775 Custom Procedural Solutions 30,496 19,920 50,416 29,155 20,229 49,384 OEM 35,460 8,829 44,289 34,570 7,637 42,207 Total 185,152 142,663 327,815 171,388 139,887 311,275 Endoscopy Endoscopy Devices 9,512 676 10,188 8,194 587 8,781 Total $ 194,664 $ 143,339 $ 338,003 $ 179,582 $ 140,474 $ 320,056 Six Months Ended Six Months Ended June 30, 2024 June 30, 2023 United States International Total United States International Total Cardiovascular Peripheral Intervention $ 161,615 $ 112,258 $ 273,873 $ 140,640 $ 99,052 $ 239,692 Cardiac Intervention 72,183 112,368 184,551 69,995 109,108 179,103 Custom Procedural Solutions 59,790 39,420 99,210 55,954 41,131 97,085 OEM 68,109 15,446 83,555 67,134 16,237 83,371 Total 361,697 279,492 641,189 333,723 265,528 599,251 Endoscopy Endoscopy Devices 19,061 1,261 20,322 17,219 1,151 18,370 Total $ 380,758 $ 280,753 $ 661,511 $ 350,942 $ 266,679 $ 617,621 |
Acquisitions (Tables)
Acquisitions (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Angio Dynamics Inc | |
Business Acquisition [Line Items] | |
Schedule of Purchase price allocation | The purchase price was allocated as follows (in thousands) : Assets Acquired Prepaid expenses $ 2,000 Inventories 5,254 Property and equipment 108 Intangible assets Developed technology 65,200 Trademarks 4,000 Customer list 5,800 Goodwill 17,638 Total net assets acquired $ 100,000 |
Bluegrass Vascular Technologies, Inc | |
Business Acquisition [Line Items] | |
Schedule of Purchase price allocation | The purchase price was allocated as follows (in thousands): Assets Acquired Inventories $ 175 Intangible assets Developed technology 28,000 Trademarks 900 Goodwill 3,898 Total net assets acquired $ 32,973 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories at June 30, 2024 and December 31, 2023 consisted of the following (in thousands): June 30, 2024 December 31, 2023 Finished goods $ 152,180 $ 158,893 Work-in-process 38,049 25,420 Raw materials 107,995 119,558 Total inventories $ 298,224 $ 303,871 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in carrying amount of goodwill | The change in the carrying amount of goodwill for the six-month period ended June 30, 2024 is detailed as follows (in thousands): 2024 Goodwill balance at January 1 $ 382,240 Effect of foreign exchange (807) Goodwill balance at June 30 $ 381,433 |
Other intangible assets | Other intangible assets at June 30, 2024 and December 31, 2023 consisted of the following (in thousands): June 30, 2024 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Patents $ 30,163 $ (11,876) $ 18,287 Distribution agreements 3,250 (2,956) 294 License agreements 11,094 (8,759) 2,335 Trademarks 35,123 (22,343) 12,780 Customer lists 40,225 (34,694) 5,531 Total $ 119,855 $ (80,628) $ 39,227 December 31, 2023 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Patents $ 28,877 $ (10,916) $ 17,961 Distribution agreements 3,250 (2,919) 331 License agreements 11,142 (8,327) 2,815 Trademarks 35,135 (20,804) 14,331 Customer lists 40,367 (33,921) 6,446 Total $ 118,771 $ (76,887) $ 41,884 |
Estimated amortization expense | Estimated amortization expense for developed technology and other intangible assets for the next five years consisted of the following as of June 30, 2024 (in thousands): Estimated Amortization Expense Remaining 2024 $ 31,367 2025 60,826 2026 49,776 2027 46,440 2028 45,024 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Principal balances outstanding under our long-term debt obligations as of June 30, 2024 and December 31, 2023 consisted of the following (in thousands): June 30, 2024 December 31, 2023 Term loans $ 75,000 $ 99,063 Convertible notes 747,500 747,500 Less unamortized debt issuance costs (21,179) (23,550) Total long-term debt 801,321 823,013 Less current portion — — Long-term portion $ 801,321 $ 823,013 |
Schedule of Maturities of Long-term Debt | Future minimum principal payments on our long-term debt, as of June 30, 2024, were as follows (in thousands): Years Ending Future Minimum December 31, Principal Payments Remaining 2024 $ — 2025 — 2026 — 2027 — 2028 75,000 Thereafter 747,500 Total future minimum principal payments $ 822,500 |
Schedule of Long-term Debt Covenants | The Amended Fourth A&R Credit Agreement is collateralized by substantially all of our assets. The Amended Fourth A&R Credit Agreement contains affirmative and negative covenants, representations and warranties, events of default and other terms customary for loans of this nature. In particular, the Amended Fourth A&R Credit Agreement requires that we maintain certain financial covenants, as follows: Covenant Requirement Consolidated Total Net Leverage Ratio (1) 5.0 to 1.0 Consolidated Senior Secured Net Leverage Ratio (2) 3.0 to 1.0 Consolidated Interest Coverage Ratio (3) 3.0 to 1.0 (1) Maximum Consolidated Total Net Leverage Ratio (as defined in the Amended Fourth A&R Credit Agreement) as of any fiscal quarter end. (2) Maximum Consolidated Senior Secured Net Leverage Ratio (as defined in the Amended Fourth A&R Credit Agreement) as of any fiscal quarter end. (3) Minimum ratio of Consolidated EBITDA (as defined in the Amended Fourth A&R Credit Agreement and adjusted for certain expenditures) to Consolidated Interest Expense (as defined in the Amended Fourth A&R Credit Agreement) for any period of four consecutive fiscal quarters. |
Derivatives (Tables)
Derivatives (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The fair value of derivative instruments on a gross basis was as follows on the dates indicated (in thousands): Fair Value of Derivative Instruments Designated as Hedging Instruments Balance Sheet Location June 30, 2024 December 31, 2023 Assets Interest rate swap Prepaid expenses and other assets $ 254 $ 1,503 Foreign currency forward contracts Prepaid expenses and other assets 2,877 2,061 Foreign currency forward contracts Other assets (long-term) 497 216 (Liabilities) Foreign currency forward contracts Accrued expenses (954) (1,898) Foreign currency forward contracts Other long-term obligations (343) (499) Fair Value of Derivative Instruments Not Designated as Hedging Instruments Balance Sheet Location June 30, 2024 December 31, 2023 Assets Foreign currency forward contracts Prepaid expenses and other assets $ 1,572 $ 828 (Liabilities) Foreign currency forward contracts Accrued expenses (953) (1,463) |
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | Derivative instruments designated as cash flow hedges had the following effects, before income taxes, on other comprehensive income (“OCI”), accumulated other comprehensive income (“AOCI”), and net earnings in our consolidated statements of income, consolidated statements of comprehensive income and consolidated balance sheets (in thousands): Amount of Gain/(Loss) Consolidated Statements Amount of Gain/(Loss) Recognized in OCI of Income Reclassified from AOCI Three Months Ended June 30, Three Months Ended June 30, Three Months Ended June 30, Derivative instrument 2024 2023 Location in statements of income 2024 2023 2024 2023 Interest rate swap $ (197) $ 719 Interest expense $ (7,679) $ (3,682) $ 699 $ 631 Foreign currency forward contracts (31) 4,325 Revenue 338,003 320,056 427 658 Cost of sales (176,903) (167,274) 357 333 Amount of Gain/(Loss) Consolidated Statements Amount of Gain/(Loss) Recognized in OCI of Income Reclassified from AOCI Six Months Ended June 30, Six Months Ended June 30, Six Months Ended June 30, Derivative instrument 2024 2023 Location in statements of income 2024 2023 2024 2023 Interest rate swap $ 151 $ 600 Interest expense $ (15,725) $ (5,693) $ 1,401 $ 1,165 Foreign currency forward contracts 4,135 4,564 Revenue 661,511 617,621 840 1,985 Cost of sales (348,696) (326,477) 784 283 |
Derivative Instruments, Gain (Loss) | The following gains/(losses) from these derivative instruments were recognized in our consolidated statements of income for the periods presented (in thousands): Three Months Ended June 30, Six Months Ended June 30, Derivative Instrument Location in statements of income 2024 2023 2024 2023 Foreign currency forward contracts Other income (expense) — net $ 645 $ 2,141 $ 1,528 $ 3,200 |
Earnings Per Common Share (EP_2
Earnings Per Common Share (EPS) (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings (Loss) Per Share, Basic and Diluted | The computation of weighted average shares outstanding and the basic and diluted earnings per common share for the three and six-month periods ended June 30, 2024 and 2023 consisted of the following (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Net income $ 35,726 $ 20,245 $ 63,966 $ 40,948 Average common shares outstanding 58,139 57,537 58,049 57,445 Basic EPS $ 0.61 $ 0.35 $ 1.10 $ 0.71 Average common shares outstanding 58,139 57,537 58,049 57,445 Effect of dilutive stock awards 601 936 604 884 Total potential shares outstanding 58,740 58,473 58,653 58,329 Diluted EPS $ 0.61 $ 0.35 $ 1.09 $ 0.70 Equity awards excluded as the impact was anti-dilutive (1) 802 1,114 1,009 1,014 (1) Does not reflect the impact of incremental repurchases under the treasury stock method. |
Stock-Based Compensation Expe_2
Stock-Based Compensation Expense (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs | Stock-based compensation expense before income tax expense for the three and six-month periods ended June 30, 2024 and 2023 consisted of the following (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Cost of sales Nonqualified stock options $ 363 $ 432 $ 725 $ 873 Research and development Nonqualified stock options 345 413 781 841 Selling, general and administrative Nonqualified stock options 1,565 1,851 3,247 3,221 Performance-based restricted stock units 2,897 1,817 4,764 2,632 Restricted stock units 1,131 467 1,718 911 Cash-settled performance-based awards 710 600 1,010 1,071 Total selling, general and administrative 6,303 4,735 10,739 7,835 Stock-based compensation expense before taxes $ 7,011 $ 5,580 $ 12,245 $ 9,549 |
Employee Stock Option | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | Six Months Ended June 30, 2023 Risk-free interest rate 3.6% - 4.5% Expected option term 4.0 years Expected dividend yield — Expected price volatility 46.7% - 47.1% |
Stock-Settled Performance-Based Restricted Stock Units | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | Six Months Ended June 30, 2024 2023 Risk-free interest rate 4.4% 3.9% - 4.6% Performance period 2.8 years 2.8 years Expected dividend yield — — Expected price volatility 31.1% 31.4% - 32.6% |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Our financial assets and (liabilities) carried at fair value and measured on a recurring basis as of June 30, 2024 and December 31, 2023 consisted of the following (in thousands): Fair Value Measurements Using Total Fair Quoted prices in Significant other Significant Value at active markets observable inputs unobservable inputs June 30, 2024 (Level 1) (Level 2) (Level 3) Marketable securities (1) $ 61 $ 61 $ — $ — Interest rate contract asset, current (2) $ 254 $ — $ 254 $ — Foreign currency contract assets, current and long-term (3) $ 4,946 $ — $ 4,946 $ — Foreign currency contract liabilities, current and long-term (4) $ (2,250) $ — $ (2,250) $ — Contingent consideration liabilities $ (3,435) $ — $ — $ (3,435) Fair Value Measurements Using Total Fair Quoted prices in Significant other Significant Value at active markets observable inputs unobservable inputs December 31, 2023 (Level 1) (Level 2) (Level 3) Marketable securities (1) $ 78 $ 78 $ — — Interest rate contract asset, current (2) $ 1,503 $ — $ 1,503 $ — Foreign currency contract assets, current and long-term (3) $ 3,105 $ — $ 3,105 $ — Foreign currency contract liabilities, current and long-term (4) $ (3,860) $ — $ (3,860) $ — Contingent consideration liabilities $ (3,447) $ — $ — $ (3,447) (1) Our marketable securities, which consist entirely of available-for-sale equity securities, are valued using market prices in active markets. Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. (2) The fair value of the interest rate contract is determined using Level 2 fair value inputs and is recorded as prepaid and other current assets in the consolidated balance sheets. (3) The fair value of the foreign currency contract assets (including those designated as hedging instruments and those not designated as hedging instruments) is determined using Level 2 fair value inputs and is recorded as a prepaid expense and other current asset or other long-term asset in the consolidated balance sheets. (4) The fair value of the foreign currency contract liabilities (including those designated as hedging instruments and those not designated as hedging instruments) is determined using Level 2 fair value inputs and is recorded as accrued expense or other long-term obligation in the consolidated balance sheets. |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | Changes in the fair value of our contingent consideration liabilities during the three and six-month periods ended June 30, 2024 and 2023 consisted of the following (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Beginning balance $ 3,225 $ 16,000 $ 3,447 $ 18,073 Contingent consideration expense 305 1,094 188 1,615 Contingent payments made (95) (13,513) (200) (16,107) Ending balance $ 3,435 $ 3,581 $ 3,435 $ 3,581 |
Fair Value Inputs, Liabilities, Quantitative Information | The recurring Level 3 measurement of our contingent consideration liabilities included the following significant unobservable inputs at June 30, 2024 and December 31, 2023 (amounts in thousands): Fair value at June 30, Valuation Weighted Contingent consideration liability 2024 technique Unobservable inputs Range Average (1) Revenue-based royalty payments contingent liability $ 2,937 Discounted cash flow Discount rate 12% - 16% 14.6% Projected year of payments 2024-2034 2028 Revenue milestones contingent liability $ 91 Monte Carlo simulation Discount rate 13.0% Projected year of payments 2024-2040 2040 Regulatory approval contingent liability $ 407 Scenario-based method Discount rate 6.1% Probability of milestone payment 50.0% Projected year of payment 2024-2030 2030 Fair value at December 31, Valuation Weighted Contingent consideration liability 2023 technique Unobservable inputs Range Average (1) Revenue-based royalty payments contingent liability $ 2,945 Discounted cash flow Discount rate 12.0% - 16.0% 14.6% Projected year of payments 2024-2034 2028 Revenue milestones contingent liability $ 93 Monte Carlo simulation Discount rate 13.0% Projected year of payments 2024-2039 2039 Regulatory approval contingent liability $ 409 Scenario-based method Discount rate 5.5% Probability of milestone payment 50.0% Projected year of payment 2024-2030 2030 (1) Unobservable inputs were weighted by the relative fair value of the instruments. No weighted average is reported for contingent consideration liabilities without a range of unobservable inputs. |
Schedule of Rollforward of Allowance for Credit Losses | The table below presents a roll-forward of the allowance for current expected credit losses on our notes receivable for the three and six-month periods ended June 30, 2024 and 2023 (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Beginning balance $ 1,388 $ 290 $ 568 $ 281 Provision for credit loss expense 18 6 838 15 Ending balance $ 1,406 $ 296 $ 1,406 $ 296 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest [Abstract] | |
Schedule of Components of Accumulated Other Comprehensive Income (Loss) | The changes in each component of accumulated other comprehensive income (loss) for the three and six-month periods ended June 30, 2024 and 2023 were as follows: Cash Flow Hedges Foreign Currency Translation Total Balance as of April 1, 2024 $ 3,932 $ (16,388) $ (12,456) Other comprehensive loss (228) (1,688) (1,916) Income taxes 404 22 426 Reclassifications to: Revenue (427) (427) Cost of sales (357) (357) Interest expense (699) (699) Net other comprehensive loss (1,307) (1,666) (2,973) Balance as of June 30, 2024 $ 2,625 $ (18,054) $ (15,429) Cash Flow Hedges Foreign Currency Translation Total Balance as of April 1, 2023 $ 3,081 $ (14,010) $ (10,929) Other comprehensive income (loss) 5,044 (1,201) 3,843 Income taxes (821) (15) (836) Reclassifications to: Revenue (658) (658) Cost of sales (333) (333) Interest expense (631) (631) Net other comprehensive income (loss) 2,601 (1,216) 1,385 Balance as of June 30, 2023 $ 5,682 $ (15,226) $ (9,544) Cash Flow Hedges Foreign Currency Translation Total Balance as of January 1, 2024 $ 1,662 $ (12,996) $ (11,334) Other comprehensive income (loss) 4,286 (5,092) (806) Income taxes (298) 34 (264) Reclassifications to: Revenue (840) (840) Cost of sales (784) (784) Interest expense (1,401) (1,401) Net other comprehensive income (loss) 963 (5,058) (4,095) Balance as of June 30, 2024 $ 2,625 $ (18,054) $ (15,429) Cash Flow Hedges Foreign Currency Translation Total Balance as of January 1, 2023 $ 4,366 $ (15,916) $ (11,550) Other comprehensive income 5,164 724 5,888 Income taxes (415) (34) (449) Reclassifications to: Revenue (1,985) (1,985) Cost of sales (283) (283) Interest expense (1,165) (1,165) Net other comprehensive income 1,316 690 2,006 Balance as of June 30, 2023 $ 5,682 $ (15,226) $ (9,544) |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Disaggregation of Revenue (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) segment item | Jun. 30, 2023 USD ($) | |
Disaggregation of Revenue [Line Items] | ||||
Number of operating segments | segment | 2 | |||
Net sales | $ 338,003 | $ 320,056 | $ 661,511 | $ 617,621 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 194,664 | 179,582 | 380,758 | 350,942 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 143,339 | 140,474 | $ 280,753 | 266,679 |
Cardiovascular | ||||
Disaggregation of Revenue [Line Items] | ||||
Number of product categories | item | 4 | |||
Net sales | 327,815 | 311,275 | $ 641,189 | 599,251 |
Cardiovascular | Peripheral Intervention | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 139,247 | 125,909 | 273,873 | 239,692 |
Cardiovascular | Cardiac Intervention | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 93,863 | 93,775 | 184,551 | 179,103 |
Cardiovascular | Custom Procedural Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 50,416 | 49,384 | 99,210 | 97,085 |
Cardiovascular | OEM | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 44,289 | 42,207 | 83,555 | 83,371 |
Cardiovascular | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 185,152 | 171,388 | 361,697 | 333,723 |
Cardiovascular | United States | Peripheral Intervention | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 82,356 | 71,973 | 161,615 | 140,640 |
Cardiovascular | United States | Cardiac Intervention | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 36,840 | 35,690 | 72,183 | 69,995 |
Cardiovascular | United States | Custom Procedural Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 30,496 | 29,155 | 59,790 | 55,954 |
Cardiovascular | United States | OEM | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 35,460 | 34,570 | 68,109 | 67,134 |
Cardiovascular | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 142,663 | 139,887 | 279,492 | 265,528 |
Cardiovascular | International | Peripheral Intervention | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 56,891 | 53,936 | 112,258 | 99,052 |
Cardiovascular | International | Cardiac Intervention | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 57,023 | 58,085 | 112,368 | 109,108 |
Cardiovascular | International | Custom Procedural Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 19,920 | 20,229 | 39,420 | 41,131 |
Cardiovascular | International | OEM | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 8,829 | 7,637 | 15,446 | 16,237 |
Endoscopy | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 10,188 | 8,781 | 20,322 | 18,370 |
Endoscopy | Endoscopy Devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 10,188 | 8,781 | 20,322 | 18,370 |
Endoscopy | United States | Endoscopy Devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 9,512 | 8,194 | 19,061 | 17,219 |
Endoscopy | International | Endoscopy Devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 676 | $ 587 | $ 1,261 | $ 1,151 |
Acquisitions - CrannMed Limited
Acquisitions - CrannMed Limited (Details) - MM Ireland - CrannMed € in Millions | May 17, 2024 EUR (€) |
Business Acquisition [Line Items] | |
Payments to acquire shares | € 3 |
Ownership percentage | 10.80% |
Commitment to Invest in Preference Shares | |
Business Acquisition [Line Items] | |
Additional funding commitment | € 3 |
Additional Funding | |
Business Acquisition [Line Items] | |
Additional funding commitment | € 2 |
Acquisitions - SSI (Details)
Acquisitions - SSI (Details) - SSI $ in Millions | Mar. 08, 2024 USD ($) item |
Asset Acquisition [Line Items] | |
Purchase price | $ 3 |
Number of annual payments | item | 3 |
Amortization period | 8 years |
First Payment | |
Asset Acquisition [Line Items] | |
Additional payments upon the achievement of specified milestones | $ 1 |
Second Payment | |
Asset Acquisition [Line Items] | |
Additional payments upon the achievement of specified milestones | 1 |
Third Payment | |
Asset Acquisition [Line Items] | |
Additional payments upon the achievement of specified milestones | $ 1 |
Acquisitions - Fluidx Medical T
Acquisitions - Fluidx Medical Technology, Inc (Details) - Fluidx - USD ($) $ in Millions | 1 Months Ended | 36 Months Ended |
Mar. 31, 2024 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | ||
Payments to acquire shares | $ 0.3 | $ 4.7 |
Ownership percentage | 19.90% |
Acquisitions - Angio Dynamics,
Acquisitions - Angio Dynamics, Inc (Details) - Angio Dynamics Inc - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Jun. 08, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Asset Acquisition [Line Items] | ||||
Total purchase price | $ 100 | |||
Net sales related to acquisition | $ 11.6 | $ 0.9 | ||
Acquisition-related costs | $ 4.9 | |||
Weighted Average | ||||
Asset Acquisition [Line Items] | ||||
Amortization period | 10 years 6 months | |||
Developed technology | ||||
Asset Acquisition [Line Items] | ||||
Amortization period | 10 years | |||
Trade Names | ||||
Asset Acquisition [Line Items] | ||||
Amortization period | 11 years | |||
Customer Lists | ||||
Asset Acquisition [Line Items] | ||||
Amortization period | 10 years |
Acquisitions - Bluegrass Vascul
Acquisitions - Bluegrass Vascular Technologies (Details) - USD ($) $ in Thousands | May 04, 2023 | May 03, 2023 |
Bluegrass Vascular Technologies, Inc | ||
Business Acquisition [Line Items] | ||
Total purchase price | $ 32,700 | |
Bluegrass Vascular Technologies, Inc | Weighted Average | ||
Business Acquisition [Line Items] | ||
Amortization period | 14 years 10 months 24 days | |
Bluegrass Vascular Technologies, Inc | Developed technology | ||
Business Acquisition [Line Items] | ||
Amortization period | 15 years | |
Bluegrass Vascular Technologies, Inc | Trademarks | ||
Business Acquisition [Line Items] | ||
Amortization period | 13 years | |
Bluegrass Vascular Technologies, Inc | ||
Business Acquisition [Line Items] | ||
Ownership percentage | 19.50% | |
Investment of common shares | 1,251,878 | |
Equity method investment | $ 245 |
Acquisitions - Purchase Price A
Acquisitions - Purchase Price Allocation (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | Jun. 08, 2023 | May 04, 2023 |
Assets Acquired | ||||
Goodwill | $ 381,433 | $ 382,240 | ||
Angio Dynamics Inc | ||||
Assets Acquired | ||||
Prepaid expenses | $ 2,000 | |||
Inventories | 5,254 | |||
Property and equipment | 108 | |||
Goodwill | 17,638 | |||
Total net assets acquired | 100,000 | |||
Angio Dynamics Inc | Developed technology | ||||
Assets Acquired | ||||
Intangible assets | 65,200 | |||
Angio Dynamics Inc | Trade Names | ||||
Assets Acquired | ||||
Intangible assets | 4,000 | |||
Angio Dynamics Inc | Customer Lists | ||||
Assets Acquired | ||||
Intangible assets | $ 5,800 | |||
Bluegrass Vascular Technologies, Inc | ||||
Assets Acquired | ||||
Inventories | $ 175 | |||
Goodwill | 3,898 | |||
Total net assets acquired | 32,973 | |||
Bluegrass Vascular Technologies, Inc | Developed technology | ||||
Assets Acquired | ||||
Intangible assets | 28,000 | |||
Bluegrass Vascular Technologies, Inc | Trade Names | ||||
Assets Acquired | ||||
Intangible assets | $ 900 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 152,180 | $ 158,893 |
Work-in-process | 38,049 | 25,420 |
Raw materials | 107,995 | 119,558 |
Total Inventories | $ 298,224 | $ 303,871 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Goodwill (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2024 USD ($) | |
Goodwill [Roll Forward] | |
Goodwill balance at beginning of period | $ 382,240 |
Effect of foreign exchange | 807 |
Goodwill balance at end of period | $ 381,433 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 119,855 | $ 118,771 |
Accumulated Amortization | (80,628) | (76,887) |
Net Carrying Amount | 39,227 | 41,884 |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 30,163 | 28,877 |
Accumulated Amortization | (11,876) | (10,916) |
Net Carrying Amount | 18,287 | 17,961 |
Distribution agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 3,250 | 3,250 |
Accumulated Amortization | (2,956) | (2,919) |
Net Carrying Amount | 294 | 331 |
License agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 11,094 | 11,142 |
Accumulated Amortization | (8,759) | (8,327) |
Net Carrying Amount | 2,335 | 2,815 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 35,123 | 35,135 |
Accumulated Amortization | (22,343) | (20,804) |
Net Carrying Amount | 12,780 | 14,331 |
Customer Lists | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 40,225 | 40,367 |
Accumulated Amortization | (34,694) | (33,921) |
Net Carrying Amount | $ 5,531 | $ 6,446 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Accumulated goodwill impairment losses | $ 8.3 | $ 8.3 | $ 8.3 | ||
Goodwill impairment loss | 0 | $ 0 | |||
Aggregate amortization expense | $ 14.8 | $ 13.4 | 29.4 | 25.7 | |
Impairment of intangible assets | $ 0 | $ 0 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Future Amortization Expense (Details) $ in Thousands | Jun. 30, 2024 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remaining 2024 | $ 31,367 |
2025 | 60,826 |
2026 | 49,776 |
2027 | 46,440 |
2028 | $ 45,024 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ 10,117 | $ 4,655 | $ 16,225 | $ 9,452 |
Effective tax rate | 22.10% | 18.70% | 20.20% | 18.80% |
Debt - Principal Balances under
Debt - Principal Balances under Long-term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 822,500 | |
Less unamortized debt issuance costs | (21,179) | $ (23,550) |
Total long-term debt | 801,321 | 823,013 |
Long-term portion | 801,321 | 823,013 |
Term Loan | ||
Debt Instrument [Line Items] | ||
Long-term debt | 75,000 | 99,063 |
Convertible Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 747,500 | $ 747,500 |
Debt - Future Minimum Payments
Debt - Future Minimum Payments on Long-term Debt (Details) $ in Thousands | Jun. 30, 2024 USD ($) |
Debt Disclosure [Abstract] | |
2028 | $ 75,000 |
Thereafter | 747,500 |
Total future minimum principal payments | $ 822,500 |
Debt - Narrative (Details)
Debt - Narrative (Details) | 1 Months Ended | ||
Dec. 31, 2023 USD ($) $ / shares $ / derivative shares | Jun. 30, 2024 USD ($) $ / shares | Jun. 06, 2023 USD ($) | |
Debt Instrument [Line Items] | |||
Outstanding borrowings | $ 822,500,000 | ||
Credit Agreement | |||
Debt Instrument [Line Items] | |||
Outstanding borrowings | 75,000,000 | ||
Letter of credit guarantees | 2,400,000 | ||
Available borrowing capacity | $ 680,000,000 | ||
Fixed interest rate percent | 3.39% | 3.39% | |
Debt subject to fixed interest rate | $ 75,000,000 | ||
Variable interest rate percent | 7.21% | ||
Debt subject to variable interest rate | $ 24,100,000 | ||
Term Loan | |||
Debt Instrument [Line Items] | |||
Outstanding borrowings | $ 99,063,000 | $ 75,000,000 | |
Term Loan | Credit Agreement | |||
Debt Instrument [Line Items] | |||
Debt instrument, face amount | $ 150,000,000 | ||
Revolving Credit Facility | Credit Agreement | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 700,000,000 | ||
Senior unsecured convertible notes | Convertible debt | |||
Debt Instrument [Line Items] | |||
Interest rate | 3% | ||
Net proceeds from convertible notes | $ 724,800,000 | ||
Shares issued upon conversion | shares | 11.5171 | ||
Debt instrument conversion ratio multiple of principal | $ 1,000 | ||
Repurchase percentage on principal, accrued and unpaid interest | 100% | ||
Number of business days period after consecutive trading days | 5 days | ||
Consecutive trading days, trading price per share after which to be observed for conversion | 10 days | ||
Percentage of sale price | 98% | ||
Common stock at a price per share less than the average closing sale price | 60 days | ||
Purchase shares of common stock at a price per share less than the average closing sale price of consecutive trading days | 10 days | ||
Percentage of distribution to common stockholders | 10% | ||
Percentage of applicable conversion price | 130% | ||
Percentage of applicable conversion price on each applicable trading day | 20 days | ||
Consecutive trading day period ending | 30 days | ||
Senior unsecured convertible notes | Convertible debt | Call option | |||
Debt Instrument [Line Items] | |||
Cap price | $ / derivative | 114.68 | ||
Capped call transaction cost | $ 66,500,000 | ||
Senior unsecured convertible notes | Convertible debt | Common Stock | |||
Debt Instrument [Line Items] | |||
Conversion price | $ / shares | $ 86.83 | $ 86.83 | |
Senior unsecured convertible notes | Convertible debt | Minimum | |||
Debt Instrument [Line Items] | |||
Reported sales price of common stock | 130% | ||
Conversion price then in effect for at least number of trading days | 20 days |
Debt - Financial Covenants (Det
Debt - Financial Covenants (Details) - Credit Agreement | 6 Months Ended |
Jun. 30, 2024 | |
Debt Instrument [Line Items] | |
Consolidated Total Leverage Ratio | 5 |
Consolidated Senior Secured Net Leverage Ratio | 3 |
Consolidated Interest Coverage Ratio | 3 |
Derivatives - Narrative (Detail
Derivatives - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Jun. 30, 2024 | Dec. 31, 2023 | Dec. 23, 2019 | |
Revenue and cost of sales | |||
Derivative [Line Items] | |||
Amount expected to be reclassified from accumulated other comprehensive income (loss) to earnings in next twelve months, gross | $ 2.9 | ||
Amount expected to be reclassified from accumulated other comprehensive income to earnings (loss) in next twelve months, net of tax | 2.2 | ||
Interest expense | |||
Derivative [Line Items] | |||
Amount expected to be reclassified from accumulated other comprehensive income (loss) to earnings in next twelve months, gross | 0.3 | ||
Amount expected to be reclassified from accumulated other comprehensive income to earnings (loss) in next twelve months, net of tax | 0.2 | ||
Interest rate swap | Designated as hedging instrument | |||
Derivative [Line Items] | |||
Fair value of derivative asset | 0.3 | $ 1.5 | |
Deferred tax liability used to offset fair value of interest rate swap | $ (0.1) | $ (0.4) | |
Interest rate swap | Wells Fargo 1.71% one-month LIBOR | Designated as hedging instrument | |||
Derivative [Line Items] | |||
Notional amount of derivative | $ 75 | ||
Fixed rate | 1.64% | ||
Investment, Variable Interest Rate, Type [Extensible Enumeration] | us-gaap:SecuredOvernightFinancingRateSofrMember | ||
Foreign currency forward contracts | |||
Derivative [Line Items] | |||
Maturity of derivative contract (up to) | 2 years |
Derivatives - Forward Notional
Derivatives - Forward Notional Contracts (Details) - Foreign currency forward contracts - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Designated as hedging instrument | Derivatives designated as cash flow hedges | ||
Derivative [Line Items] | ||
Aggregate notional amount of derivative | $ 134 | $ 141.1 |
Not designated as hedging instrument | Fair Value Hedging | ||
Derivative [Line Items] | ||
Aggregate notional amount of derivative | $ 110.8 | $ 108.4 |
Derivatives - Fair Value of Der
Derivatives - Fair Value of Derivative Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Designated as hedging instrument | Interest rate swap | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative asset | $ 300 | $ 1,500 |
Designated as hedging instrument | Interest rate swap | Prepaid expenses and other assets | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative asset | 254 | 1,503 |
Designated as hedging instrument | Foreign currency forward contracts | Prepaid expenses and other assets | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative asset | 2,877 | 2,061 |
Designated as hedging instrument | Foreign currency forward contracts | Other assets (long-term) | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative asset | 497 | 216 |
Designated as hedging instrument | Foreign currency forward contracts | Accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Total Liability Derivatives | (954) | (1,898) |
Designated as hedging instrument | Foreign currency forward contracts | Other long-term obligations | ||
Derivatives, Fair Value [Line Items] | ||
Total Liability Derivatives | (343) | (499) |
Not designated as hedging instrument | Foreign currency forward contracts | Prepaid expenses and other assets | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative asset | 1,572 | 828 |
Not designated as hedging instrument | Foreign currency forward contracts | Accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Total Liability Derivatives | $ (953) | $ (1,463) |
Derivatives - Amount of Gain (L
Derivatives - Amount of Gain (Loss) Recognized in OCI and Income Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain/(Loss) recognized in OCI | $ (1,711) | $ 3,422 | $ 1,261 | $ 1,731 |
Interest expense | (7,679) | (3,682) | (15,725) | (5,693) |
Net sales | 338,003 | 320,056 | 661,511 | 617,621 |
Cost of sales | (176,903) | (167,274) | (348,696) | (326,477) |
Derivatives designated as cash flow hedges | Interest rate swap | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain/(Loss) recognized in OCI | (197) | 719 | 151 | 600 |
Derivatives designated as cash flow hedges | Interest rate swap | Interest expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain/(Loss) reclassified from AOCI | 699 | 631 | 1,401 | 1,165 |
Derivatives designated as cash flow hedges | Foreign currency forward contracts | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain/(Loss) recognized in OCI | (31) | 4,325 | 4,135 | 4,564 |
Derivatives designated as cash flow hedges | Foreign currency forward contracts | Revenue | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain/(Loss) reclassified from AOCI | 427 | 658 | 840 | 1,985 |
Derivatives designated as cash flow hedges | Foreign currency forward contracts | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain/(Loss) reclassified from AOCI | $ 357 | $ 333 | $ 784 | $ 283 |
Derivatives - Gain (Loss) in th
Derivatives - Gain (Loss) in the Consolidated Statements of Income (Details) - Not designated as hedging instrument - Foreign currency forward contracts - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Derivative [Line Items] | ||||
Gain (loss) on derivative | $ 645 | $ 2,141 | $ 1,528 | $ 3,200 |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Earnings Per Common Share (EP_3
Earnings Per Common Share (EPS) - Basic EPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2024 | Mar. 31, 2024 | Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Earnings Per Share [Abstract] | ||||||
Net income | $ 35,726 | $ 28,240 | $ 20,245 | $ 20,703 | $ 63,966 | $ 40,948 |
Average common shares outstanding (in shares) | 58,139 | 57,537 | 58,049 | 57,445 | ||
Basic EPS (in dollars per share) | $ 0.61 | $ 0.35 | $ 1.10 | $ 0.71 |
Earnings Per Common Share (EP_4
Earnings Per Common Share (EPS) - Diluted EPS (Details) - $ / shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Earnings Per Share [Abstract] | ||||
Average common shares outstanding (in shares) | 58,139 | 57,537 | 58,049 | 57,445 |
Effect of dilutive stock awards (in shares) | 601 | 936 | 604 | 884 |
Total potential shares outstanding (in shares) | 58,740 | 58,473 | 58,653 | 58,329 |
Diluted EPS (in dollars per share) | $ 0.61 | $ 0.35 | $ 1.09 | $ 0.70 |
Equity awards excluded as the impact was anti-dilutive (in shares) | 802 | 1,114 | 1,009 | 1,014 |
Earnings Per Common Share (EP_5
Earnings Per Common Share (EPS) - Convertible Noes (Details) - $ / shares | Jun. 30, 2024 | Dec. 31, 2023 |
Convertible Notes | Senior unsecured convertible notes | Common Stock | ||
Debt Instrument [Line Items] | ||
Conversion price | $ 86.83 | $ 86.83 |
Stock-Based Compensation Expe_3
Stock-Based Compensation Expense - Allocation of Recognized Period Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated share-based compensation | $ 7,011 | $ 5,580 | $ 12,245 | $ 9,549 |
Cost of sales | Employee Stock Option | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated share-based compensation | 363 | 432 | 725 | 873 |
Research and development | Employee Stock Option | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated share-based compensation | 345 | 413 | 781 | 841 |
Selling, general and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated share-based compensation | 6,303 | 4,735 | 10,739 | 7,835 |
Selling, general and administrative | Employee Stock Option | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated share-based compensation | 1,565 | 1,851 | 3,247 | 3,221 |
Selling, general and administrative | Stock-Settled Performance-Based Restricted Stock Units | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated share-based compensation | 2,897 | 1,817 | 4,764 | 2,632 |
Selling, general and administrative | Restricted Stock Units | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated share-based compensation | 1,131 | 467 | 1,718 | 911 |
Selling, general and administrative | Cash-Settled Performance-Based Share-Based Awards (Liability Awards) | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Allocated share-based compensation | $ 710 | $ 600 | $ 1,010 | $ 1,071 |
Stock-Based Compensation Expe_4
Stock-Based Compensation Expense - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Restricted stock units granted (in shares) | 20,358 | |||
Employee Stock Option | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Options granted in period (in shares) | 0 | 327,294 | ||
Compensation cost not yet recognized | $ 15.4 | $ 15.4 | ||
Compensation cost not yet recognized, period of recognition | 2 years | |||
Stock-Settled Performance-Based Restricted Stock Units | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Compensation cost not yet recognized | 20.3 | $ 20.3 | ||
Compensation cost not yet recognized, period of recognition | 2 years 1 month 6 days | |||
Award vesting period | 1 year | |||
Stock-Settled Performance-Based Restricted Stock Units | Maximum | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Stock units granted in period (in shares) | 364,810 | 286,863 | ||
Cash-Settled Performance-Based Share-Based Awards (Liability Awards) | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Target cash incentive | $ 1.6 | $ 1.3 | ||
Compensation cost not yet recognized | 4.4 | $ 4.4 | ||
Compensation cost not yet recognized, period of recognition | 2 years | |||
Fair value of awards | $ 3.4 | $ 3.4 | $ 3.4 | |
Cash-Settled Performance-Based Share-Based Awards (Liability Awards) | Maximum | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Target cash incentive | $ 4.4 | $ 4.4 | ||
Multiplying factor | 250% | 250% | ||
Restricted Stock Units | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Restricted stock units granted (in shares) | 158,719 | |||
Compensation cost not yet recognized | $ 10.2 | $ 10.2 | ||
Compensation cost not yet recognized, period of recognition | 3 years 3 months 18 days | |||
Restricted Stock Units | Employee | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Award vesting period | 4 years | |||
Restricted Stock Units | Non-employee members | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Award vesting period | 1 year |
Stock-Based Compensation Expe_5
Stock-Based Compensation Expense - Option Granted Fair Value Calculation Assumptions (Details) - Employee Stock Option | 6 Months Ended |
Jun. 30, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free interest rate, minimum | 3.60% |
Risk-free interest rate, maximum | 4.50% |
Expected option term / Performance Period | 4 years |
Expected price volatility, minimum | 46.70% |
Expected price volatility, maximum | 47.10% |
Stock-Based Compensation Expe_6
Stock-Based Compensation Expense - PSUs Fair Value Calculation Assumptions (Details) - Stock-Settled Performance-Based Restricted Stock Units | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate, minimum | 3.90% | |
Risk-free interest rate, maximum | 4.60% | |
Risk-free interest rate | 4.40% | |
Expected option term / Performance Period | 2 years 9 months 18 days | 2 years 9 months 18 days |
Expected dividend yield | 0% | 0% |
Expected price volatility, minimum | 31.40% | |
Expected price volatility, maximum | 32.60% | |
Expected price volatility | 31.10% |
Segment Reporting - Narrative (
Segment Reporting - Narrative (Details) | 6 Months Ended |
Jun. 30, 2024 segment item | |
Segment Reporting Information [Line Items] | |
Number of operating segments | segment | 2 |
Cardiovascular | |
Segment Reporting Information [Line Items] | |
Number of Product Categories | item | 4 |
Segment Reporting - Operating I
Segment Reporting - Operating Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2024 | Mar. 31, 2024 | Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Segment Reporting Information [Line Items] | ||||||
Net sales | $ 338,003 | $ 320,056 | $ 661,511 | $ 617,621 | ||
Income from operations | 45,946 | 28,812 | 81,868 | 55,195 | ||
Total other expense - net | (103) | (3,912) | (1,677) | (4,795) | ||
Income tax expense | 10,117 | 4,655 | 16,225 | 9,452 | ||
Net income | 35,726 | $ 28,240 | 20,245 | $ 20,703 | 63,966 | 40,948 |
Cardiovascular | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 327,815 | 311,275 | 641,189 | 599,251 | ||
Income from operations | 42,912 | 26,464 | 75,819 | 50,398 | ||
Endoscopy | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 10,188 | 8,781 | 20,322 | 18,370 | ||
Income from operations | $ 3,034 | $ 2,348 | $ 6,049 | $ 4,797 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and (Liabilities) Carried at Fair Value (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Fair Value, Inputs, Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 61 | $ 78 |
Fair Value, Inputs, Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate contract asset, current | 254 | 1,503 |
Foreign currency contract assets, current and long-term | 4,946 | 3,105 |
Foreign currency contract liabilities, current and long-term | (2,250) | (3,860) |
Fair Value, Inputs, Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration liabilities | (3,435) | (3,447) |
Estimate of Fair Value, Fair Value Disclosure | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 61 | 78 |
Interest rate contract asset, current | 254 | 1,503 |
Foreign currency contract assets, current and long-term | 4,946 | 3,105 |
Foreign currency contract liabilities, current and long-term | (2,250) | (3,860) |
Contingent consideration liabilities | $ (3,435) | $ (3,447) |
Fair Value Measurements - Liabi
Fair Value Measurements - Liability Measured on Recurring Basis, Unobservable Input Reconciliation (Details) - Contingent Consideration - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | $ 3,225 | $ 16,000 | $ 3,447 | $ 18,073 |
Contingent consideration expense | $ 305 | $ 1,094 | $ 188 | $ 1,615 |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Business Combination, Contingent Consideration Arrangements, Contingent Consideration Benefit | Business Combination, Contingent Consideration Arrangements, Contingent Consideration Benefit | Business Combination, Contingent Consideration Arrangements, Contingent Consideration Benefit | Business Combination, Contingent Consideration Arrangements, Contingent Consideration Benefit |
Contingent payments made | $ (95) | $ (13,513) | $ (200) | $ (16,107) |
Ending balance | $ 3,435 | $ 3,581 | $ 3,435 | $ 3,581 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Mar. 31, 2024 | Dec. 31, 2023 | May 03, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Payments related to the settlement of the contingent consideration liability, Financing activities | $ 142 | $ 3,434 | |||||||
Payments related to the settlement of the contingent consideration liability, Operating activities | 100 | 12,700 | |||||||
Impairment of equity method investment | 0 | ||||||||
Impairment of intangible assets | 0 | 0 | |||||||
Interest income | $ 7,561 | $ 221 | 14,837 | 352 | |||||
Investments in privately held companies | 22,600 | 22,600 | $ 19,100 | ||||||
Long-term notes receivable, net | 8,700 | 8,700 | 3,200 | ||||||
Long-term notes receivable issued | 6,200 | ||||||||
Allowance for expected credit losses | 1,406 | $ 296 | 1,406 | 296 | $ 1,388 | 568 | $ 290 | $ 281 | |
Solo Pace | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Long-term notes receivable issued | 1,500 | ||||||||
Fluidx | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Ownership percentage | 19.90% | ||||||||
Long-term notes receivable issued | 3,000 | ||||||||
Bluegrass Vascular Technologies, Inc | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Impairment of equity method investment | $ 300 | ||||||||
Ownership percentage | 19.50% | ||||||||
Equity method investment | $ 245 | ||||||||
Selio | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Long-term notes receivable issued | 1,700 | ||||||||
Allowance for expected credit losses | 1,400 | 1,400 | 600 | ||||||
Other long-term obligations | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Contingent consideration liability, noncurrent | 3,000 | 3,000 | 3,000 | ||||||
Accrued expenses | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Contingent consideration liability, current | $ 400 | $ 400 | $ 400 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Inputs, Liabilities, Quantitative Information (Details) - Fair Value, Inputs, Level 3 $ in Thousands | Jun. 30, 2024 USD ($) | Dec. 31, 2023 USD ($) |
Revenue-based royalty | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Contingent consideration liabilities | $ 2,937 | $ 2,945 |
Revenue milestones | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Contingent consideration liabilities | 91 | 93 |
Regulatory approval | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Contingent consideration liabilities | $ 407 | $ 409 |
Discount rate | Revenue-based royalty | Minimum | Discounted Cash Flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Unobservable inputs, contingent liability | 0.12 | 0.120 |
Discount rate | Revenue-based royalty | Maximum | Discounted Cash Flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Unobservable inputs, contingent liability | 0.16 | 0.160 |
Discount rate | Revenue-based royalty | Weighted Average | Discounted Cash Flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Unobservable inputs, contingent liability | 0.146 | 0.146 |
Discount rate | Revenue milestones | Discounted Cash Flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Unobservable inputs, contingent liability | 0.130 | |
Discount rate | Revenue milestones | Minimum | Discounted Cash Flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Unobservable inputs, contingent liability | 0.130 | |
Discount rate | Regulatory approval | Discounted Cash Flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Unobservable inputs, contingent liability | 0.061 | 0.055 |
Probability of milestone payment | Regulatory approval | Discounted Cash Flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Unobservable inputs, contingent liability | 0.500 | 0.500 |
Fair Value Measurements - Allow
Fair Value Measurements - Allowance for Credit Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Beginning balance | $ 1,388 | $ 290 | $ 568 | $ 281 |
Provision for credit loss expense | 18 | 6 | 838 | 15 |
Ending balance | $ 1,406 | $ 296 | $ 1,406 | $ 296 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Changes in AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Accumulated other comprehensive income (loss) | ||||
Beginning balance | $ 1,240,190 | $ 1,171,655 | $ 1,202,000 | $ 1,144,397 |
Reclassifications to: | ||||
Cost of sales | (176,903) | (167,274) | (348,696) | (326,477) |
Interest expense | (7,679) | (3,682) | (15,725) | (5,693) |
Ending balance | 1,282,445 | 1,203,700 | 1,282,445 | 1,203,700 |
Accumulated Other Comprehensive Loss | ||||
Accumulated other comprehensive income (loss) | ||||
Beginning balance | (12,456) | (10,929) | (11,334) | (11,550) |
Other comprehensive income (loss) | (1,916) | 3,843 | (806) | 5,888 |
Income taxes | 426 | (836) | (264) | (449) |
Reclassifications to: | ||||
Net other comprehensive income (loss) | (2,973) | 1,385 | (4,095) | 2,006 |
Ending balance | (15,429) | (9,544) | (15,429) | (9,544) |
Accumulated Other Comprehensive Loss | Reclassification out of Accumulated Other Comprehensive Income | ||||
Reclassifications to: | ||||
Revenue | (427) | (658) | (840) | (1,985) |
Cost of sales | (357) | (333) | (784) | (283) |
Interest expense | (699) | (631) | (1,401) | (1,165) |
Cash Flow Hedges | ||||
Accumulated other comprehensive income (loss) | ||||
Beginning balance | 3,932 | 3,081 | 1,662 | 4,366 |
Other comprehensive income (loss) | (228) | 5,044 | 4,286 | 5,164 |
Income taxes | 404 | (821) | (298) | (415) |
Reclassifications to: | ||||
Net other comprehensive income (loss) | (1,307) | 2,601 | 963 | 1,316 |
Ending balance | 2,625 | 5,682 | 2,625 | 5,682 |
Cash Flow Hedges | Reclassification out of Accumulated Other Comprehensive Income | ||||
Reclassifications to: | ||||
Revenue | (427) | (658) | (840) | (1,985) |
Cost of sales | (357) | (333) | (784) | (283) |
Interest expense | (699) | (631) | (1,401) | (1,165) |
Foreign Currency Translation | ||||
Accumulated other comprehensive income (loss) | ||||
Beginning balance | (16,388) | (14,010) | (12,996) | (15,916) |
Other comprehensive income (loss) | (1,688) | (1,201) | (5,092) | 724 |
Income taxes | 22 | (15) | 34 | (34) |
Reclassifications to: | ||||
Net other comprehensive income (loss) | (1,666) | (1,216) | (5,058) | 690 |
Ending balance | $ (18,054) | $ (15,226) | $ (18,054) | $ (15,226) |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Jul. 01, 2024 USD ($) |
Subsequent Event | EGS Purchase Agreement | |
Subsequent Event [Line Items] | |
Purchase price | $ 105 |