Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Mar. 14, 2014 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-13 | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Trading Symbol | 'OFIX | ' |
Entity Registrant Name | 'ORTHOFIX INTERNATIONAL N V | ' |
Entity Central Index Key | '0000884624 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 18,187,194 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | |||||
Current assets: | ' | ' | ' | ' | ' |
Cash and cash equivalents | $22,219 | ' | $31,055 | $53,572 | $33,207 |
Restricted cash | 22,732 | ' | 21,314 | ' | ' |
Trade accounts receivable, less allowance for doubtful accounts of $11,460 and $13,543 at September 30, 2013 and December 31, 2012, respectively | 75,252 | ' | 107,312 | ' | ' |
Inventories | 100,204 | ' | 83,373 | ' | ' |
Deferred income taxes | 34,053 | ' | 33,450 | ' | ' |
Prepaid expenses and other current assets | 27,313 | ' | 34,079 | ' | ' |
Total current assets | 281,773 | ' | 310,583 | ' | ' |
Property, plant and equipment, net | 55,762 | ' | 53,835 | ' | ' |
Patents and other intangible assets, net | 9,821 | ' | 7,290 | ' | ' |
Goodwill | 55,405 | 72,758 | 74,388 | ' | 73,094 |
Deferred income taxes | 19,911 | ' | 18,881 | ' | ' |
Other long-term assets | 7,386 | ' | 7,920 | ' | ' |
Total assets | 430,058 | ' | 472,897 | ' | ' |
Current liabilities: | ' | ' | ' | ' | ' |
Trade accounts payable | 14,710 | ' | 22,575 | ' | ' |
Other current liabilities | 51,308 | ' | 39,610 | ' | ' |
Total current liabilities | 66,018 | ' | 62,185 | ' | ' |
Long-term debt | 20,000 | ' | 20,000 | ' | ' |
Deferred income taxes | 12,834 | ' | 11,456 | ' | ' |
Other long-term liabilities | 12,149 | ' | 11,424 | ' | ' |
Total liabilities | 111,001 | ' | 105,065 | ' | ' |
Contingencies (Note 16) | ' | ' | ' | ' | ' |
Shareholders' equity: | ' | ' | ' | ' | ' |
Common shares $0.10 par value; 50,000,000 shares authorized; 18,101,476 and 19,339,329 issued and outstanding as of September 30, 2013 and December 31, 2012, respectively | 1,810 | ' | 1,934 | ' | ' |
Additional paid-in capital | 215,081 | ' | 246,306 | ' | ' |
Retained earnings | 97,208 | ' | 114,847 | ' | ' |
Accumulated other comprehensive income | 4,958 | ' | 4,745 | ' | ' |
Total shareholders' equity | 319,057 | ' | 367,832 | ' | ' |
Total liabilities and shareholders' equity | $430,058 | ' | $472,897 | ' | ' |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Statement Of Financial Position [Abstract] | ' | ' |
Trade accounts receivable, allowance for doubtful accounts | $11,460 | $13,543 |
Common shares, par value | $0.10 | $0.10 |
Common shares, authorized | 50,000,000 | 50,000,000 |
Common shares, issued | 18,101,476 | 19,339,329 |
Common shares, outstanding | 18,101,476 | 19,339,329 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Income (Loss) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Statement [Abstract] | ' | ' | ' | ' |
Product sales | $81,061 | $96,552 | $259,030 | $296,062 |
Marketing service fees | 11,677 | 11,305 | 35,361 | 34,154 |
Net sales | 92,738 | 107,857 | 294,391 | 330,216 |
Cost of sales | 23,920 | 24,384 | 69,783 | 73,309 |
Gross profit | 68,818 | 83,473 | 224,608 | 256,907 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | 42,382 | 43,022 | 132,346 | 137,225 |
General and administrative | 13,202 | 13,850 | 46,736 | 42,715 |
Research and development | 6,361 | 6,858 | 20,653 | 23,160 |
Amortization of intangible assets | 616 | 565 | 1,725 | 1,725 |
Costs related to the accounting review and restatement | 2,664 | ' | 2,664 | ' |
Impairment of goodwill | 19,193 | ' | 19,193 | ' |
Charges related to U.S. Government resolutions | ' | 373 | ' | 1,059 |
Total operating expenses | 84,418 | 64,668 | 223,317 | 205,884 |
Operating income (loss) | -15,600 | 18,805 | 1,291 | 51,023 |
Other income and expense | ' | ' | ' | ' |
Interest expense, net | -555 | -464 | -1,585 | -3,950 |
Other income (expense), net | -1,481 | -1,021 | 2,076 | -992 |
Total other income (expense) | -2,036 | -1,485 | 491 | -4,942 |
Income (loss) before income taxes | -17,636 | 17,320 | 1,782 | 46,081 |
Income tax (expense) | -448 | -6,746 | -8,126 | -17,040 |
Net income (loss) from continuing operations, net of tax | -18,084 | 10,574 | -6,344 | 29,041 |
Discontinued operations (Note 15) | ' | ' | ' | ' |
Gain on sale of Breg, Inc., net of tax | ' | 221 | ' | 1,261 |
Loss from discontinued operations | -3,041 | -9,048 | -16,629 | -14,374 |
Income tax benefit | 1,303 | 3,269 | 5,334 | 5,749 |
Net loss from discontinued operations, net of tax | -1,738 | -5,558 | -11,295 | -7,364 |
Net Income (loss) | -19,822 | 5,016 | -17,639 | 21,677 |
Net income (loss) per common share-basic: | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | ($1) | $0.55 | ($0.34) | $1.54 |
Net (loss) from discontinued operations, net of tax | ($0.10) | ($0.29) | ($0.60) | ($0.39) |
Net income (loss) per common share-basic | ($1.10) | $0.26 | ($0.94) | $1.15 |
Net income (loss) per common share-diluted: | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | ($1) | $0.54 | ($0.34) | $1.51 |
Net (loss) from discontinued operations, net of tax | ($0.10) | ($0.29) | ($0.60) | ($0.38) |
Net income (loss) per common share-diluted: | ($1.10) | $0.25 | ($0.94) | $1.13 |
Weighted average number of common shares: | ' | ' | ' | ' |
Basic | 18,142,935 | 19,078,590 | 18,897,887 | 18,861,374 |
Diluted | 18,142,935 | 19,533,021 | 18,897,887 | 19,300,263 |
Comprehensive income (loss) | ($16,064) | $6,440 | ($17,426) | $22,069 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities: | ' | ' |
Net income (loss) | ($17,639) | $21,677 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 15,459 | 15,615 |
Amortization of debt costs | 540 | 1,556 |
Provision for doubtful accounts | 4,225 | 5,919 |
Deferred income taxes | -223 | -5,342 |
Share-based compensation | 4,714 | 4,834 |
Impairment of goodwill | 19,193 | ' |
Gain on sale of Breg, Inc. | ' | -1,261 |
Income tax benefit on employee stock-based awards | 795 | ' |
Excess income tax benefit on employee stock-based compensation | -82 | -2,321 |
Other | -520 | -3,353 |
Change in operating assets and liabilities, net of effect of disposition: | ' | ' |
Trade accounts receivable | 27,758 | -14,169 |
Inventories | -11,596 | 325 |
Escrow receivable | ' | 41,537 |
Prepaid expenses and other current assets | 5,541 | -771 |
Trade accounts payable | -8,028 | 985 |
Charges related to U.S. Government resolutions | ' | 1,059 |
Other current liabilities | 13,040 | 1,876 |
Long-term assets | -313 | -1,093 |
Long-term liabilities | -912 | 1,322 |
Net cash provided by operating activities | 51,952 | 68,395 |
Cash flows from investing activities: | ' | ' |
Capital expenditures for property, plant and equipment | -19,427 | -18,212 |
Capital expenditures for intangible assets | -4,525 | -422 |
Net proceeds from the sale of Breg, Inc. | ' | 153,773 |
Net cash provided by (used in) investing activities | -23,952 | 135,139 |
Cash flows from financing activities: | ' | ' |
Net proceeds from issuance of common shares | 3,431 | 24,406 |
Repayments of long-term debt | ' | -188,695 |
Repayment of bank borrowings, net | -16 | -1,036 |
Changes in restricted cash | -1,371 | -20,219 |
Repurchase of treasury shares | -39,494 | ' |
Excess income tax benefit on employee stock-based awards | 82 | 2,321 |
Net cash used in financing activities | -37,368 | -183,223 |
Effect of exchange rate changes on cash | 532 | 54 |
Net (decrease) increase in cash and cash equivalents | -8,836 | 20,365 |
Cash and cash equivalents at the beginning of the period | 31,055 | 33,207 |
Cash and cash equivalents at the end of the period | $22,219 | $53,572 |
Summary_of_significant_account
Summary of significant accounting policies | 9 Months Ended | ||
Sep. 30, 2013 | |||
Accounting Policies [Abstract] | ' | ||
Summary of significant accounting policies | ' | ||
1 | Summary of significant accounting policies | ||
(a) | Basis of presentation | ||
The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S.”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Pursuant to these rules and regulations, certain information and note disclosures, normally included in financial statements prepared in accordance with accounting principles generally accepted in the U.S., have been condensed or omitted. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. The balance sheet at December 31, 2012 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by accounting principles generally accepted in the U.S. for complete financial statements. For further information, refer to the Consolidated Financial Statements and Notes thereto of the 2012 Form 10-K/A. The notes to the unaudited condensed consolidated financial statements are presented on a continuing basis unless otherwise noted. | |||
(b) | Reclassifications | ||
The Company has reclassified certain line items to conform to the current year presentation. The reclassifications have no effect on previously reported net income or shareholders’ equity. | |||
(c) | Use of estimates | ||
The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an ongoing basis, the Company evaluates its estimates including those related to the resolution of U.S. government matters, contractual allowances, doubtful accounts, inventories, taxes, shared-based compensation, and potential goodwill and intangible asset impairment. Actual results could differ from these estimates. | |||
(d) | Foreign Currency Translation | ||
The financial statements for operations outside the United States are generally maintained in their local currency. All foreign currency denominated balance sheet accounts, except shareholders’ equity, are translated to U.S. dollars at year end exchange rates and revenue and expense items are translated at weighted average rates of exchange prevailing during the year. Gains and losses resulting from the translation of foreign currency are recorded in the accumulated other comprehensive income component of shareholders’ equity. | |||
(e) | Goodwill | ||
The Company generally calculates fair value of indefinite-lived intangible assets as the present value of estimated future cash flows. In determining the estimated future cash flows associated with intangible assets, the Company uses estimates and assumptions about future revenue contributions, cost structures and remaining useful lives of the asset (asset group). The use of alternative assumptions, including estimated cash flows, discount rates, and alternative estimated remaining useful lives could result in different calculations of impairment. | |||
The Company tests goodwill at least annually for impairment. The Company tests more frequently if indicators are present or changes in circumstances suggest that impairment may exist. These indicators include, among others, declines in sales, earnings or cash flows, or the development of a material adverse change in the business climate. The Company assesses goodwill for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment, referred to as a reporting unit. | |||
In order to calculate the respective carrying values, the Company initially recorded goodwill based on the purchase price allocation performed at the time of acquisition. Corporate assets and liabilities that directly relate to a reporting unit’s operations are ascribed directly to that reporting unit. Corporate assets and liabilities that are not directly related to a specific reporting unit, but from which the reporting unit benefits, are allocated based on the respective contribution measure of each reporting unit. Effective July 1, 2013, the Company re-aligned its segments and consequently reallocated the carrying value of goodwill from its previous reporting units to its new reporting units based on the relative fair value of each new reporting unit to total enterprise value at July 1, 2013. | |||
In the first quarter of 2012, ASU 2011-08, “Testing of Goodwill for Impairment” became effective. ASU 2011-08 allows entities testing goodwill for impairment the option of performing a qualitative assessment before calculating the fair value of a reporting unit (i.e. the first step of the goodwill impairment test). If entities determine, on the basis of qualitative factors, that the fair value of the reporting unit is more likely than not greater than the carrying amount, a quantitative calculation would not be needed. | |||
As a result of the Company’s change in reportable segments, the Company allocated goodwill to each reportable segment, and subsequently evaluated the Spine Fixation and Extremity Fixation reportable units for the possible impairment of goodwill under step two, as there were indicators of impairment when completing step one. The result of this step two analysis was a full impairment of the goodwill allocated to our Spine Fixation and our Extremity Fixation reportable units, totaling $19.2 million. See Note 5, “Goodwill” for details. |
Restatement_of_the_Condensed_C
Restatement of the Condensed Consolidated Financial Statements | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||
Text Block [Abstract] | ' | ||||||||||||||||||||||||||||
Restatement of the Condensed Consolidated Financial Statements | ' | ||||||||||||||||||||||||||||
2 | Restatement of the Condensed Consolidated Financial Statements | ||||||||||||||||||||||||||||
Background | |||||||||||||||||||||||||||||
In July 2013, the Audit Committee (the “Audit Committee”) of the Company’s Board of Directors (the “Board”) commenced an independent review with the assistance of outside professionals into whether the Company had properly recognized revenue under U.S. generally accepted accounting principles (“GAAP”) in connection with certain revenue that had been recorded in 2012 and 2011 (the “Independent Review”). In conjunction with the Independent Review, the Company concluded that material errors existed in the previously issued financial statements for the fiscal years ended December 31, 2012, 2011 and 2010, as well as for the interim quarterly period ended March 31, 2013. In addition, the Company has identified and corrected errors occurring prior to January 1, 2010 by recognizing a cumulative adjustment to beginning retained earnings in the consolidated statements of changes in shareholders’ equity included in the consolidated financial statements filed with the 2012 Form 10-K/A. | |||||||||||||||||||||||||||||
In reaching these conclusions, the Company considered information obtained in the Independent Review, including emails, data and interviews with current and former employees that indicated (i) the existence of extra-contractual terms or arrangements at the onset of the sale and concessions agreed to subsequent to the initial sale, such as extended payment terms, and return and exchange rights for sales to distributors with respect to certain transactions, (ii) that at the time of some sales collection was not reasonably assured, and (iii) that certain amounts previously characterized as commissions were paid to related parties of the applicable customer. | |||||||||||||||||||||||||||||
The Company assessed the information derived from the Independent Review in making determinations with respect to accounting adjustments reflected in the restated consolidated financial statements contained in this Form 10-Q and in the 2012 Form 10-K/A, and such determinations are consistent with the findings of the Independent Review. In addition to the matters that were the subject of the Independent Review, certain other adjustments identified by management, including revisions to inventory reserves and royalties, were made to the consolidated financial statements in connection with the restatement. | |||||||||||||||||||||||||||||
The correction of these errors had the following impact for the three and nine months ended September 30, 2012: decreased net sales by $6.9 million and $20.1 million, respectively; and decreased net income from continuing operations by $2.5 million and $10.3 million, respectively. The following include descriptions of the significant adjustments to the Company’s financial position and results of operations from the previously reported consolidated financial statements. | |||||||||||||||||||||||||||||
Distributor Revenue Recognition | |||||||||||||||||||||||||||||
The Company has determined that it previously recognized revenue with respect to certain distributor relationships before all revenue recognition criteria were met. Specifically, the Company has determined that a fixed or determinable sales price did not exist, and/or collection was not reasonably assured, with respect to certain transactions where revenue had previously been recognized at the time of shipment. Specifically, the Company’s review revealed arrangements, or extra-contractual terms, with certain of the Company’s distributors regarding extended payment terms, return or exchange rights, and contingent payment obligations for sales to such distributors with respect to certain transactions. There were also concessions being made subsequent to the shipment of inventory to the distributors and the related revenue recognition. Based on the results of this review, it was determined that these arrangements were not appropriately evaluated under the appropriate revenue recognition criteria applicable under GAAP. | |||||||||||||||||||||||||||||
The Company previously recognized distributor revenue as title and risk of loss passed at either shipment from the Company’s facilities or receipt at the distributor’s facility, assuming all other revenue recognition criteria had been achieved (the “sell-in method”). Based on review of all facts and circumstances related to the arrangements described above, the Company determined that in many instances the revenue recognition criteria under the sell-in method were not satisfied at the time of shipment or receipt; specifically, the existence of extra-contractual terms or arrangements caused the Company not to meet the fixed or determinable criteria for revenue recognition in some cases, and in others collectability had not been established. In situations where the Company is unable to reasonably estimate the effects of these extra-contractual terms, it is precluded from recognizing revenue relating to distributor arrangements until the product is delivered to the end customer. This method is commonly referred to as the “sell-through” revenue recognition method because the vendor does not recognize revenue until the transaction consideration is fixed or determinable, which coincides with the selling of the product through the distribution channel to the end customer. Because the Company does not have reliable information about when its distributors sell the product through to end customers, the Company will use cash collection from distributors as a basis for revenue recognition under the sell-through method. Although in many cases the Company is legally entitled to the accounts receivable at the time of shipment, since the revenue recognition criteria has not been met, the Company has not recognized accounts receivables or any corresponding deferred revenues associated with these transactions. | |||||||||||||||||||||||||||||
As part of the review, the Company also considered the accounting treatment for the related cost of sales when distributor revenue is recognized on a sell-through basis. Previously, cost of sales were recognized upon shipment; however, the Company believes the matching of the recognition of costs of sales with revenue is preferred and therefore considered if such costs should be deferred until revenue is recognized on a sell-through basis. In making this assessment, the Company considered the financial viability of its distributors based on their creditworthiness to determine if collectability of amounts sufficient to realize the costs of the products shipped was reasonably assured at the time of shipment to these distributors. In instances where the distributor was determined to be financially viable, the Company determined that costs of sales should be deferred until the revenue is recognized. For those distributors where the Company has concluded that collectability was not reasonably assured, the Company has expensed the related cost of sales upon shipment. | |||||||||||||||||||||||||||||
Based on the results of the Independent Review, the Company determined that all distributor transactions should be transitioned to the sell-through method of accounting as of the dates described below: | |||||||||||||||||||||||||||||
• | For distributor transactions within the Company’s Orthopedics division, the Company has determined that sell-through accounting should be applied within the Brazil subsidiary for all prior periods given the frequency with which the Company conducted business under extra-contractual and undocumented terms, as well as the Company’s inability to fully access underlying transactional and other information that would be necessary to evaluate transactions under a sell-in basis. For distributor transactions within the division outside the Brazil subsidiary, there were also sales to four distributors that did not meet the fixed or determinable or collectability revenue recognition criteria and therefore, such sales were adjusted to sell-through accounting in the restatement. | ||||||||||||||||||||||||||||
• | For distributor transactions within the Company’s U.S. Spine division, the Company has determined that sell-through accounting should be applied beginning January 1, 2011. Following its consideration of the information provided from the Independent Review, the Company believes that January 1, 2011 is the date extra-contractual terms became pervasive in the Company’s U.S. business, and it is unaware of circumstances existing prior to that date that would require it to broadly apply sell-through accounting to all distributor transactions within the U.S. Spine division. Additionally, there were sales in 2012 and 2011 for which revenue was previously recognized that did not meet the fixed or determinable criteria and the product associated with such sales was subsequently returned in 2013 (i) under the terms of negotiated agreements whereby the Company terminated its relationships with two distributors and (ii) by an additional distributor who returned certain product sold pursuant to a contingent sales arrangement. Such sales represented approximately $3.3 million for the year ended December 31, 2012. Due to the return of the product, no revenue will be recognized for these transactions. | ||||||||||||||||||||||||||||
• | The Company has determined that stimulation products sold to distributors within the Company’s U.S. Spine division during 2012 did not meet the fixed or determinable (and in some cases, collectability) revenue recognition criterion at the time of shipment. Therefore, the Company has determined that sell-through accounting should be applied for these sales. Management also determined that many of these distributors (or affiliates thereof) received commission payments as part of the sales transactions, which the Company previously recorded as sales and marketing expense. The Company has recorded adjustments in the restatement to net these commission expenses against revenue, as they represented product discounts. | ||||||||||||||||||||||||||||
• | The Company has determined that it will prospectively apply sell-through accounting for all remaining distributor arrangements (which entails arrangements within the Company’s Orthopedics division outside the Brazil subsidiary) beginning April 1, 2013, the earliest date for which financial statements had not previously been issued by the Company at the time of the determination. Although the Independent Review did not provide information to indicate extra-contractual terms or that historical revenue recognition was inappropriate in these remaining instances, the Company believes the information from the Independent Review indicating that the Company has a history of extra-contractual arrangements for distributor transactions, as described above, provides additional information which should be considered in reassessing the application of sell-through accounting on a prospective basis, particularly given that the Company believes that there is a higher risk associated with distributor arrangements generally. | ||||||||||||||||||||||||||||
The effect of adjustments made to the Company’s previously filed consolidated statements of operations as a result of these matters for the three and nine months ended September 30, 2012 are shown in the tables below. These adjustments also had the following effects on the Company’s previously filed December 31, 2012 consolidated balance sheet: | |||||||||||||||||||||||||||||
• | Accounts receivable decreased as of December 31, 2012 by $41.3 million related to the de-recognition of receivables for which revenue has been deferred and will now be recognized on a sell-through basis, based on cash collections. | ||||||||||||||||||||||||||||
• | Inventory increased as of December 31, 2012 by $11.0 million to recognize the costs of inventory shipments to distributors determined to be financially viable, as discussed previously. | ||||||||||||||||||||||||||||
Inventory Reserves | |||||||||||||||||||||||||||||
The Company also identified material errors in inventory reserves. One error related to the Company recording an increase of $1.2 million to the Company’s excess and obsolete reserve in the second quarter of 2012 related to a product within the Spine business that was subsequently reversed by the Company in the fourth quarter of 2012. During the Company’s review, it was determined that removing the reserve in the fourth quarter of 2012 was not correct; therefore the reserve has been reinstated. | |||||||||||||||||||||||||||||
The Company has also determined that certain inconsistencies existed with respect to how the Company previously computed and recorded inventory reserves. As a result, the Company has reviewed the methodologies used to compute and record inventory reserves and determined that errors in the application of GAAP existed in prior periods, which required adjustment in these financial statements. Based on this review, the Company has determined that it previously made reductions to previously recorded reserves based on changes in forecasted demand, which it believes was contrary to guidance set forth in ASC Topic 330, Inventory (specifically ASC 330-10-35-14), which states that a write-down of inventory to the lower-of-cost-or-market value at the close of a fiscal period creates a new cost basis that subsequently should not be marked up based on changes in underlying circumstances. The restated consolidated financial statements contain several adjustments to reflect recomputed inventory reserves in each of the relevant periods. | |||||||||||||||||||||||||||||
These adjustments resulted in a decrease to inventory (due to an increase in reserves) as of December 31, 2012 of $14.8 million. | |||||||||||||||||||||||||||||
Royalties | |||||||||||||||||||||||||||||
The Company also reviewed the accounting for royalties and determined there were royalties classified as sales and marketing expense; however, such royalties were based on sales of products and were paid to doctors who consulted on development of those products. Given these amounts are attributable to the cost of producing our products, we determined they are correctly classified as cost of goods sold. | |||||||||||||||||||||||||||||
Other Adjustments | |||||||||||||||||||||||||||||
In addition to the adjustments recorded to address the Company’s errors in accounting for distributor revenue recognition, inventory reserves, and royalties, the Company has identified other errors that are generally not material, individually or in the aggregate, but have been recorded in connection with the restatement. | |||||||||||||||||||||||||||||
There were no material impacts to the statements of cash flows for the items above. The results of the adjustments to the Company’s previously filed consolidated statements of operations detailed above for the three and nine months ended September 30, 2012 are summarized in the tables below. The tax effect of the adjustments is estimated based on the Company’s effective tax rate. | |||||||||||||||||||||||||||||
Three Months Ended September 30, 2012 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 114,752 | $ | (6,422 | ) | $ | — | $ | — | $ | (473 | ) | $ | (6,895 | ) | $ | 107,857 | ||||||||||||
Cost of sales | 22,373 | (265 | ) | 123 | 2,018 | 135 | 2,011 | 24,384 | |||||||||||||||||||||
Gross profit | 92,379 | (6,157 | ) | (123 | ) | (2,018 | ) | (608 | ) | (8,906 | ) | 83,473 | |||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 49,298 | (4,212 | ) | — | (2,018 | ) | (46 | ) | (6,276 | ) | 43,022 | ||||||||||||||||||
General and administrative | 13,850 | — | — | — | — | — | 13,850 | ||||||||||||||||||||||
Research and development | 6,858 | — | — | — | — | — | 6,858 | ||||||||||||||||||||||
Amortization of intangibles assets | 515 | — | — | — | 50 | 50 | 565 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | 325 | — | — | — | 48 | 48 | 373 | ||||||||||||||||||||||
70,846 | (4,212 | ) | — | (2,018 | ) | 52 | (6,178 | ) | 64,668 | ||||||||||||||||||||
Operating income | 21,533 | (1,945 | ) | (123 | ) | — | (660 | ) | (2,728 | ) | 18,805 | ||||||||||||||||||
Other income and (expense) | (1,485 | ) | — | — | — | — | — | (1,485 | ) | ||||||||||||||||||||
Income before income taxes | 20,048 | (1,945 | ) | (123 | ) | — | (660 | ) | (2,728 | ) | 17,320 | ||||||||||||||||||
Income tax (expense) | (6,930 | ) | 131 | 8 | — | 45 | 184 | (6,746 | ) | ||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 13,118 | $ | (1,814 | ) | $ | (115 | ) | $ | — | $ | (615 | ) | $ | (2,544 | ) | $ | 10,574 | |||||||||||
Nine Months Ended September 30, 2012 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 350,286 | $ | (19,678 | ) | $ | — | $ | — | $ | (392 | ) | $ | (20,070 | ) | $ | 330,216 | ||||||||||||
Cost of sales | 67,989 | (3,837 | ) | 2,791 | 6,223 | 143 | 5,320 | 73,309 | |||||||||||||||||||||
Gross profit | 282,297 | (15,841 | ) | (2,791 | ) | (6,223 | ) | (535 | ) | (25,390 | ) | 256,907 | |||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 148,629 | (5,156 | ) | — | (6,223 | ) | (25 | ) | (11,404 | ) | 137,225 | ||||||||||||||||||
General and administrative | 42,715 | — | — | — | — | — | 42,715 | ||||||||||||||||||||||
Research and development | 23,160 | — | — | — | — | — | 23,160 | ||||||||||||||||||||||
Amortization of intangibles assets | 1,575 | — | — | — | 150 | 150 | 1,725 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | 1,689 | — | — | — | (630 | ) | (630 | ) | 1,059 | ||||||||||||||||||||
217,768 | (5,156 | ) | — | (6,223 | ) | (505 | ) | (11,884 | ) | 205,884 | |||||||||||||||||||
Operating income | 64,529 | (10,685 | ) | (2,791 | ) | — | (30 | ) | (13,506 | ) | 51,023 | ||||||||||||||||||
Other income and (expense) | (4,942 | ) | — | — | — | — | — | (4,942 | ) | ||||||||||||||||||||
Income before income taxes | 59,587 | (10,685 | ) | (2,791 | ) | — | (30 | ) | (13,506 | ) | 46,081 | ||||||||||||||||||
Income tax (expense) | (20,286 | ) | 2,340 | 1,111 | — | (205 | ) | 3,246 | (17,040 | ) | |||||||||||||||||||
Net income from continuing operations, net of tax | $ | 39,301 | $ | (8,345 | ) | $ | (1,680 | ) | $ | — | $ | (235 | ) | $ | (10,260 | ) | $ | 29,041 | |||||||||||
The effects of the restatement on the Company’s condensed consolidated balance sheet as of December 31, 2012 are as follows: | |||||||||||||||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||||||||||
(Unaudited, U.S. Dollars, in thousands, except share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 31,055 | $ | — | $ | 31,055 | |||||||||||||||||||||||
Restricted cash | 21,314 | — | 21,314 | ||||||||||||||||||||||||||
Trade accounts receivable, less allowances of $13,543 | 150,316 | (43,004 | ) | 107,312 | |||||||||||||||||||||||||
Inventories | 88,744 | (5,371 | ) | 83,373 | |||||||||||||||||||||||||
Deferred income taxes | 16,959 | 16,491 | 33,450 | ||||||||||||||||||||||||||
Prepaid expenses and other current assets | 32,056 | 2,023 | 34,079 | ||||||||||||||||||||||||||
Total current assets | 340,444 | (29,861 | ) | 310,583 | |||||||||||||||||||||||||
Property, plant and equipment, net | 51,362 | 2,473 | 53,835 | ||||||||||||||||||||||||||
Patents and other intangible assets, net | 6,880 | 410 | 7,290 | ||||||||||||||||||||||||||
Goodwill | 74,388 | — | 74,388 | ||||||||||||||||||||||||||
Deferred income taxes | 19,904 | (1,023 | ) | 18,881 | |||||||||||||||||||||||||
Other long-term assets | 11,303 | (3,383 | ) | 7,920 | |||||||||||||||||||||||||
Total assets | $ | 504,281 | $ | (31,384 | ) | $ | 472,897 | ||||||||||||||||||||||
Liabilities and shareholders’ equity | |||||||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||||||
Trade accounts payable | $ | 21,812 | 763 | $ | 22,575 | ||||||||||||||||||||||||
Other current liabilities | 46,985 | (7,375 | ) | 39,610 | |||||||||||||||||||||||||
Total current liabilities | 68,797 | (6,612 | ) | 62,185 | |||||||||||||||||||||||||
Long-term debt | 20,000 | — | 20,000 | ||||||||||||||||||||||||||
Deferred income taxes | 11,456 | — | 11,456 | ||||||||||||||||||||||||||
Other long-term liabilities | 4,930 | 6,494 | 11,424 | ||||||||||||||||||||||||||
Total liabilities | 105,183 | (118 | ) | 105,065 | |||||||||||||||||||||||||
Contingencies (Note 16) | |||||||||||||||||||||||||||||
Shareholders’ equity: | |||||||||||||||||||||||||||||
Common shares $0.10 par value; 50,000,000 shares authorized; 19,339,329 issued and outstanding | 1,934 | — | 1,934 | ||||||||||||||||||||||||||
Additional paid-in capital | 246,111 | 195 | 246,306 | ||||||||||||||||||||||||||
Retained earnings | 148,549 | (33,702 | ) | 114,847 | |||||||||||||||||||||||||
Accumulated other comprehensive income | 2,504 | 2,241 | 4,745 | ||||||||||||||||||||||||||
Total shareholders’ equity | 399,098 | (31,266 | ) | 367,832 | |||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 504,281 | $ | (31,384 | ) | $ | 472,897 | ||||||||||||||||||||||
The effects of the restatements on the Company’s condensed consolidated statement of operations and comprehensive income for the three months ended September 30, 2012 are as follows: | |||||||||||||||||||||||||||||
(Unaudited, U.S. Dollars, in thousands, except share and per share data) | Three Months Ended September 30, 2012 | ||||||||||||||||||||||||||||
Previously | Adjustments | Restated | |||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 103,111 | $ | (6,559 | ) | $ | 96,552 | ||||||||||||||||||||||
Marketing service fees | 11,641 | (336 | ) | 11,305 | |||||||||||||||||||||||||
Net sales | 114,752 | (6,895 | ) | 107,857 | |||||||||||||||||||||||||
Cost of sales | 22,373 | 2,011 | 24,384 | ||||||||||||||||||||||||||
Gross profit | 92,379 | (8,906 | ) | 83,473 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 49,298 | (6,276 | ) | 43,022 | |||||||||||||||||||||||||
General and administrative | 13,850 | — | 13,850 | ||||||||||||||||||||||||||
Research and development | 6,858 | — | 6,858 | ||||||||||||||||||||||||||
Amortization of intangible assets | 515 | 50 | 565 | ||||||||||||||||||||||||||
Impairment of goodwill | — | — | — | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions | 325 | 48 | 373 | ||||||||||||||||||||||||||
70,846 | (6,178 | ) | 64,668 | ||||||||||||||||||||||||||
Operating income | 21,533 | (2,728 | ) | 18,805 | |||||||||||||||||||||||||
Other income and expense | |||||||||||||||||||||||||||||
Interest expense, net | (464 | ) | — | (464 | ) | ||||||||||||||||||||||||
Other expense | (1,021 | ) | — | (1,021 | ) | ||||||||||||||||||||||||
(1,485 | ) | — | (1,485 | ) | |||||||||||||||||||||||||
Income before income taxes | 20,048 | (2,728 | ) | 17,320 | |||||||||||||||||||||||||
Income tax expense | (6,930 | ) | 184 | (6,746 | ) | ||||||||||||||||||||||||
Net income from continuing operations, net of tax | 13,118 | (2,544 | ) | 10,574 | |||||||||||||||||||||||||
Discontinued operations (Note 15) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | 221 | — | 221 | ||||||||||||||||||||||||||
Loss from discontinued operations | (9,046 | ) | (2 | ) | (9,048 | ) | |||||||||||||||||||||||
Income tax benefit | 3,267 | 2 | 3,269 | ||||||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (5,558 | ) | — | (5,558 | ) | ||||||||||||||||||||||||
Net income | $ | 7,560 | $ | (2,544 | ) | $ | 5,016 | ||||||||||||||||||||||
Net income (loss) per common share-basic: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.69 | $ | (0.14 | ) | $ | 0.55 | ||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.29 | ) | — | (0.29 | ) | ||||||||||||||||||||||||
Net income per common share-basic | $ | 0.4 | $ | (0.14 | ) | $ | 0.26 | ||||||||||||||||||||||
Net income (loss) per common share-diluted: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.67 | $ | (0.13 | ) | $ | 0.54 | ||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.28 | ) | (0.01 | ) | (0.29 | ) | |||||||||||||||||||||||
Net income per common share-diluted | $ | 0.39 | $ | (0.14 | ) | $ | 0.25 | ||||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 19,078,590 | — | 19,078,590 | ||||||||||||||||||||||||||
Diluted | 19,533,021 | — | 19,533,021 | ||||||||||||||||||||||||||
Comprehensive income | $ | 9,067 | $ | (2,627 | ) | $ | 6,440 | ||||||||||||||||||||||
The effects of the restatements on the Company’s condensed consolidated statement of operations and comprehensive income for the nine months ended September 30, 2012 are as follows: | |||||||||||||||||||||||||||||
(Unaudited, U.S. Dollars, in thousands, except share and per share data) | Nine Months Ended September 30, 2012 | ||||||||||||||||||||||||||||
Previously | Adjustments | Restated | |||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 315,837 | $ | (19,775 | ) | $ | 296,062 | ||||||||||||||||||||||
Marketing service fees | 34,449 | (295 | ) | 34,154 | |||||||||||||||||||||||||
Net sales | 350,286 | (20,070 | ) | 330,216 | |||||||||||||||||||||||||
Cost of sales | 67,989 | 5,320 | 73,309 | ||||||||||||||||||||||||||
Gross profit | 282,297 | (25,390 | ) | 256,907 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 148,629 | (11,404 | ) | 137,225 | |||||||||||||||||||||||||
General and administrative | 42,715 | — | 42,715 | ||||||||||||||||||||||||||
Research and development | 23,160 | — | 23,160 | ||||||||||||||||||||||||||
Amortization of intangible assets | 1,575 | 150 | 1,725 | ||||||||||||||||||||||||||
Impairment of goodwill | — | — | — | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions | 1,689 | (630 | ) | 1,059 | |||||||||||||||||||||||||
217,768 | (11,884 | ) | 205,884 | ||||||||||||||||||||||||||
Operating income | 64,529 | (13,506 | ) | 51,023 | |||||||||||||||||||||||||
Other income and expense | |||||||||||||||||||||||||||||
Interest expense, net | (3,950 | ) | — | (3,950 | ) | ||||||||||||||||||||||||
Other expense | (992 | ) | — | (992 | ) | ||||||||||||||||||||||||
(4,942 | ) | — | (4,942 | ) | |||||||||||||||||||||||||
Income before income taxes | 59,587 | (13,506 | ) | 46,081 | |||||||||||||||||||||||||
Income tax expense | (20,286 | ) | 3,246 | (17,040 | ) | ||||||||||||||||||||||||
Net income from continuing operations, net of tax | 39,301 | (10,260 | ) | 29,041 | |||||||||||||||||||||||||
Discontinued operations (Note 15) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | 1,261 | — | 1,261 | ||||||||||||||||||||||||||
Loss from discontinued operations | (15,398 | ) | 1,024 | (14,374 | ) | ||||||||||||||||||||||||
Income tax benefit | 5,617 | 132 | 5,749 | ||||||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (8,520 | ) | 1,156 | (7,364 | ) | ||||||||||||||||||||||||
Net income | $ | 30,781 | $ | (9,104 | ) | $ | 21,677 | ||||||||||||||||||||||
Net income (loss) per common share-basic: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 2.08 | $ | (0.54 | ) | $ | 1.54 | ||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.45 | ) | 0.06 | (0.39 | ) | ||||||||||||||||||||||||
Net income per common share-basic | $ | 1.63 | $ | (0.48 | ) | $ | 1.15 | ||||||||||||||||||||||
Net income (loss) per common share-diluted: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 2.04 | $ | (0.53 | ) | $ | 1.51 | ||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.45 | ) | 0.07 | (0.38 | ) | ||||||||||||||||||||||||
Net income per common share-diluted | $ | 1.59 | $ | (0.46 | ) | $ | 1.13 | ||||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 18,861,374 | — | 18,861,374 | ||||||||||||||||||||||||||
Diluted | 19,300,263 | — | 19,300,263 | ||||||||||||||||||||||||||
Comprehensive income | $ | 30,615 | $ | (8,657 | ) | $ | 20,751 |
Inventories
Inventories | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
3 | Inventories | ||||||||
Inventories are valued at the lower of cost or market, after provision for excess, obsolete or impaired items which is reviewed and updated on a periodic basis by management. For inventory procured or produced, whether internally or through contract manufacturing arrangements, at our manufacturing facility in Italy, cost is determined on a weighted-average basis, which approximates the first in, first out method (“FIFO”), due to the high turn-over rate of inventory at this location. For inventory procured or produced, whether internally or through contract manufacturing arrangements, at our manufacturing facility in Texas, standard costs, which approximates actual cost on the FIFO method, is used to value inventory. Standard costs are reviewed annually by management, or more often in the event circumstances indicate a change in cost has occurred. The valuation of work-in-process, finished products, field inventory and consignment inventory includes the cost of materials, labor and production costs. Field inventory represents immediately saleable finished products inventory that is in the possession of the Company’s direct sales representatives. Consignment inventory represents immediately saleable finished products located at third party customers, such as distributors and hospitals. Deferred cost of sales result from transactions where the Company has shipped product or performed services for which all revenue recognition criteria have not yet been met. Once all revenue recognition criteria have been met, the deferred revenues and associated cost of sales are recognized. | |||||||||
Inventories, net of reserves, were as follows: | |||||||||
(US$ in thousands) | September 30, | December 31, | |||||||
2013 | 2012 | ||||||||
(Restated) | |||||||||
Raw materials | $ | 6,038 | $ | 7,623 | |||||
Work-in-process | 8,230 | 7,886 | |||||||
Finished products | 40,682 | 28,308 | |||||||
Field inventory | 31,682 | 22,629 | |||||||
Consignment inventory | 4,589 | 6,155 | |||||||
Deferred cost of sales | 8,983 | 10,772 | |||||||
Total Inventory | $ | 100,204 | $ | 83,373 | |||||
Patents_and_other_intangible_a
Patents and other intangible assets | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||
Patents and other intangible assets | ' | ||||||||
4 | Patents and other intangible assets | ||||||||
(US$ in thousands) | September 30, | December 31, | |||||||
2013 | 2012 | ||||||||
(Restated) | |||||||||
Cost | |||||||||
Patents | $ | 41,135 | $ | 38,905 | |||||
Trademarks — definite lived | 632 | 657 | |||||||
41,767 | 39,562 | ||||||||
Accumulated amortization | |||||||||
Patents | (31,487 | ) | (31,845 | ) | |||||
Trademarks — definite lived | (459 | ) | (427 | ) | |||||
(31,946 | ) | (32,272 | ) | ||||||
Patents and other intangible assets, net | $ | 9,821 | $ | 7,290 | |||||
Goodwill
Goodwill | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||
Goodwill | ' | ||||||||||||||||||||||||||||
5 | Goodwill | ||||||||||||||||||||||||||||
The following table presents the changes in the net carrying value of goodwill by reportable segment as well as the reallocation and impairment of goodwill as of July 1, 2013 in conjunction with our change in reportable segments. (See Note 1 “Summary of significant accounting policies”): | |||||||||||||||||||||||||||||
(US$ in thousands) | Spine | Orthopedics | BioStim | Biologics | Spine | Extremity | Total | ||||||||||||||||||||||
Fixation | Fixation | ||||||||||||||||||||||||||||
At December 31, 2011 | $ | 41,419 | $ | 31,675 | $ | — | $ | — | $ | — | $ | — | $ | 73,094 | |||||||||||||||
Foreign currency | 145 | 1,149 | — | — | — | — | 1,294 | ||||||||||||||||||||||
At December 31, 2012 | 41,564 | 32,824 | — | — | — | — | 74,388 | ||||||||||||||||||||||
Foreign currency | (163 | ) | (1,467 | ) | — | — | — | — | (1,630 | ) | |||||||||||||||||||
At June 30, 2013 | 41,401 | 31,357 | — | — | — | — | 72,758 | ||||||||||||||||||||||
Reallocation at July 1, 2013 | (41,401 | ) | (31,357 | ) | 42,678 | 10,887 | 9,368 | 9,825 | — | ||||||||||||||||||||
Impairment | — | — | — | — | (9,368 | ) | (9,825 | ) | (19,193 | ) | |||||||||||||||||||
Foreign currency | — | — | 1,472 | 368 | — | — | 1,840 | ||||||||||||||||||||||
At September 30, 2013 | $ | — | $ | — | $ | 44,150 | $ | 11,255 | $ | — | $ | — | $ | 55,405 | |||||||||||||||
Goodwill Impairment | |||||||||||||||||||||||||||||
The Company tests goodwill at least annually for impairment. The Company tests more frequently if indicators are present or changes in circumstances suggest that impairment may exist. These indicators include, among others, declines in sales, earnings or cash flows, or the development of a material adverse change in the business climate. The Company assesses goodwill for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment, referred to as a reporting unit. | |||||||||||||||||||||||||||||
In order to calculate the respective carrying values, the Company initially recorded goodwill based on the purchase price allocation performed at the time of acquisition. Corporate assets and liabilities that directly relate to a reporting unit’s operations are ascribed directly to that reporting unit. Corporate assets and liabilities that are not directly related to a specific reporting unit, but from which the reporting unit benefits, are allocated based on the respective contribution measure of each reporting unit. Effective July 1, 2013, the Company re-aligned its segments, and consequently reallocated the carrying value of goodwill to its new reporting units, determined to be the Company’s segments (i.e., BioStim, Biologics, Spine Fixation, and Extremity Fixation), based on the relative fair value of each new reporting unit to total enterprise value at July 1, 2013. | |||||||||||||||||||||||||||||
As a result of the Company’s change in reportable segments, the Company re-allocated goodwill to each reporting unit. We estimated the fair value of each reporting unit using a weighting of fair values derived from an income approach, a cost approach, and a market approach (all Level 3 fair value measurements). Under the income approach, we calculated the fair value of each reporting unit based on the present value of its estimated future cash flows. Cash flow projections are based on our estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions. The discount rate used was based on the weighted average cost of capital adjusted for the risks associated with the reporting unit and the projected cash flows. The cost approach involves methods of determining a Company’s value by analyzing the market value of a Company’s assets. The market approach estimates fair value based on market multiples of revenue and earnings of comparable publicly traded companies that have similar operating and investment characteristics as our online reporting unit. | |||||||||||||||||||||||||||||
Upon estimating the fair value of the reporting units, we determined it was less than its carrying value for two of our reporting units, Spine Fixation and Extremity Fixation. As a result, we performed step two of the impairment analysis and allocated the fair value of these reporting units to the estimated fair values of each of the assets and liabilities of the reporting units (including identifiable intangible assets) with the excess fair value being the implied goodwill. Estimating the fair value of certain assets and liabilities requires significant judgment about future cash flows. The implied fair value of the reporting unit’s goodwill was less than its carrying value, which we recorded as a full impairment loss of goodwill for our Spine Fixation and Extremity Fixation reporting units, totaling $19.2 million, during the third quarter of 2013. |
Bank_borrowings
Bank borrowings | 9 Months Ended | |
Sep. 30, 2013 | ||
Debt Disclosure [Abstract] | ' | |
Bank borrowings | ' | |
6 | Bank borrowings | |
Borrowings under the line of credit consists of borrowings in Euros used to fund international operations. There were no borrowings under such facilities at September 30, 2013 and $0.1 million at December 31, 2012. The weighted average interest rates on borrowings under the line of credit at December 31, 2012 was 3.70%. | ||
The Company had an unused available line of credit of €5.8 million ($7.8 million) and €5.8 million ($7.6 million) at September 30, 2013 and December 31, 2012, respectively, in its Italian line of credit. This line of credit provides the Company the option to borrow amounts in Italy at rates which are determined at the time of borrowing. This line of credit is unsecured. |
Longterm_debt
Long-term debt | 9 Months Ended | |
Sep. 30, 2013 | ||
Debt Disclosure [Abstract] | ' | |
Long-term debt | ' | |
7 | Long-term debt | |
On August 30, 2010, the Company’s wholly-owned U.S. holding company, Orthofix Holdings, Inc. (“Orthofix Holdings”) entered into a Credit Agreement (the “Credit Agreement”) with certain domestic direct and indirect subsidiaries of the Company (the “Guarantors”), JPMorgan Chase Bank, N.A., as Administrative Agent, RBS Citizens, N.A., as Syndication Agent, and certain lender parties thereto. | ||
The Credit Agreement provides for a five year, $200 million secured revolving credit facility (the “Revolving Credit Facility”), and a five year, $100 million secured term loan facility (the “Term Loan Facility,” and together with the Revolving Credit Facility, the “Credit Facilities”). Orthofix Holdings has the ability to increase the amount of the Credit Facilities by an aggregate amount of up to $50 million upon satisfaction of certain conditions. | ||
In May 2012, the Company used a portion of the proceeds from the sale of Breg, Inc. (“Breg”) (see Note 15 “Sale of Breg and Disposition of Sports Medicine SBU”) to repay in full the remaining $87.5 million balance on the Term Loan Facility and pay down $57.5 million of amounts outstanding under the Revolving Credit Facility. This use of proceeds was required by the lenders’ consent dated April 23, 2012 to the Credit Agreement. As a result of the sale of Breg, Breg ceased to be a subsidiary of the Company and, therefore, Breg was released as a credit party under the Credit Agreement. Additionally, the Company paid $20 million in June 2012 and $20 million in September 2012 to reduce amounts outstanding under the Revolving Credit Facility. As a result, at December 31, 2012, the Term Loan Facility had been repaid in full and there was $20 million outstanding under the Revolving Credit Facility as of September 30, 2013 and December 31, 2012. Borrowings under the Credit Facilities bear interest at a floating rate, which is, at Orthofix Holdings’ option, either the London Inter-Bank Offered Rate (“LIBOR”) plus an applicable margin or a base rate (as defined in the Credit Agreement) plus an applicable margin (in each case subject to adjustment based on financial ratios). Such applicable margin will be up to 3.25% for LIBOR borrowings and up to 2.25% for base rate borrowings depending upon a measurement of the consolidated leverage ratio with respect to the immediately preceding four fiscal quarters. As of September 30, 2013 and December 31, 2012, the entire Revolving Credit Facility was at the LIBOR rate plus a margin of 2.50%. The effective interest rate on the Credit Facilities as of September 30, 2013 and December 31, 2012 was 2.7%. | ||
Outstanding balances on the Revolving Credit Facility are due on August 30, 2015. | ||
Borrowings under the Revolving Credit Facility, which may be made in the future, will be used for working capital, capital expenditures and other general corporate purposes of Orthofix Holdings and its subsidiaries. The Guarantors have guaranteed repayment of Orthofix Holdings’ obligations under the Credit Agreement. The obligations of Orthofix Holdings and each of the Guarantors with respect to the Credit Facilities are secured by a pledge of substantially all of the assets of Orthofix Holdings and each of the Guarantors. | ||
The Credit Agreement, as amended, requires Orthofix Holdings and the Company to comply with coverage ratios on a consolidated basis and contains affirmative and negative covenants, including limitations on additional debt, liens, investments and acquisitions. The Credit Agreement, as amended, also includes events of default customary for facilities of this type. Upon the occurrence of an event of default, all outstanding loans may be accelerated and/or the lenders’ commitments terminated. | ||
On August 14, 2013, as a result of the delay in filing our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2013 and expected delay in filing this Report, we sought and obtained a Limited Waiver which waived requirements under the Credit Agreement to deliver quarterly financial statements for the fiscal quarters ending on June 30, 2013 and September 30, 2013, and related financial covenant certificates, until the earlier of (i) March 31, 2014 or (ii) the date that is one day after such financial statements are publicly filed or released. The Company was in compliance with the affirmative and negative covenants at September 30, 2013 and there were no events of default. | ||
Certain subsidiaries of the Company have restrictions on their ability to pay dividends or make intercompany loan advances pursuant to the Company’s Credit Facilities. The net assets of Orthofix Holdings and its subsidiaries are restricted for distributions to the parent company. Domestic subsidiaries of the Company, as parties to the credit agreement, have access to these net assets for operational purposes. | ||
The amount of restricted net assets of Orthofix Holdings and its subsidiaries as of September 30, 2013 and December 31, 2012 is $200.5 million and $213.4 million, respectively. In addition, the Credit Agreement restricts the Company and subsidiaries that are not parties to the Credit Facilities from access to cash held by Orthofix Holdings, Inc. and its subsidiaries. All of the Company’s subsidiaries that are parties to the Credit Agreement have access to this cash for operational and debt repayment purposes. The amount of restricted cash of the Company as of September 30, 2013 and December 31, 2012 was $22.7 million and $21.3 million, respectively. | ||
In conjunction with obtaining the Credit Facilities and the Credit Agreement, as amended, the Company incurred debt issuance costs of $5 million. These costs are being amortized using the effective interest method over the life of the Credit Facilities. In conjunction with the Term Loan Facility repayment in May 2012, the Company wrote off $0.8 million of related debt issuance costs. As of September 30, 2013 and December 31, 2012, debt issuance costs, net of accumulated amortization, related to the Credit Agreement were $1.3 million and $1.8 million, respectively. |
Derivative_instruments
Derivative instruments | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||
Derivative instruments | ' | ||||||||||||||||
8. Derivative instruments | |||||||||||||||||
The tables below disclose the types of derivative instruments the Company owns, the classifications and fair values of these instruments within the balance sheet, and the amount of gain (loss) recognized in other comprehensive income (loss) (“OCI”) or net income (loss). | |||||||||||||||||
(US$ in thousands) | Fair value: favorable | Balance sheet location | |||||||||||||||
As of September 30, 2013 | (unfavorable) | ||||||||||||||||
Cross-currency swap | $ | (523 | ) | Other long-term liabilities | |||||||||||||
As of December 31, 2012 | |||||||||||||||||
Cross-currency swap | $ | 305 | Other long-term assets | ||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(US$ in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Cross-currency swap unrealized gain (loss) recorded in other comprehensive income (loss), net of taxes | $ | 582 | $ | 253 | $ | 486 | $ | 177 | |||||||||
Cross-currency swap | |||||||||||||||||
On September 30, 2010, the Company entered into a cross-currency swap agreement (the “replacement swap agreement”) with JPMorgan Chase Bank and Royal Bank of Scotland PLC (the “counterparties”) to manage its cash flows related to foreign currency exposure for a portion of the Company’s intercompany receivable of a U.S. dollar functional currency subsidiary that is denominated in Euro. | |||||||||||||||||
Under the terms of the swap agreement, the Company pays Euros based on a €28.7 million notional value and a fixed rate of 5.00% and receives U.S. dollars based on a notional value of $39 million and a fixed rate of 4.635%. The expiration date is December 30, 2016, the date upon which the underlying intercompany debt, to which the swap agreement applies, matures. The swap agreement is designated as a cash flow hedge and therefore the Company recognized an unrealized gain (loss) on the change in fair value, net of tax, within other comprehensive income (loss). |
Fair_value_measurements
Fair value measurements | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair value measurements | ' | ||||||||||||||||
9 | Fair value measurements | ||||||||||||||||
Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Non-financial assets and liabilities of the Company measured at fair value include any long-lived assets or equity method investments that are impaired in a currently reported period. The authoritative guidance also describes three levels of inputs that may be used to measure fair value: | |||||||||||||||||
Level 1 | — | quoted prices in active markets for identical assets and liabilities | |||||||||||||||
Level 2 | — | observable inputs other than quoted prices in active markets for identical assets and liabilities | |||||||||||||||
Level 3 | — | unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions | |||||||||||||||
As of September 30, 2013, the Company’s financial instruments included cash equivalents, restricted cash, accounts receivable, short-term bank borrowings, accounts payable, long-term secured debt and a cross currency derivative contract. Cash equivalents consist of short-term, highly liquid, income-producing investments, all of which have original maturities of 90 days or less, including money market funds. The carrying value of restricted cash, accounts receivable, short-term bank borrowings and accounts payable approximate fair value due to the short-term maturities of these instruments. The Company’s credit facilities carry a floating rate of interest, and therefore, the carrying value is considered to approximate the fair value. | |||||||||||||||||
The Company’s cross-currency derivative instrument is the only financial instrument recorded at fair value on a recurring basis. This instrument consists of an over-the-counter contract, which is not traded on a public exchange. The fair value of the swap contract is determined based on inputs that are readily available in public markets or can be derived from information available in publicly quoted markets. Therefore, the Company has categorized the swap contract as a Level 2 derivative financial instrument. The Company also considers counterparty credit risk and its own credit risk in its determination of all estimated fair values. The Company has consistently applied these valuation techniques in all periods presented. | |||||||||||||||||
The fair value of the Company’s financial assets and liabilities on a recurring basis were as follows: | |||||||||||||||||
(US$ in thousands) | Balance | Level 1 | Level 2 | Level 3 | |||||||||||||
September 30, | |||||||||||||||||
2013 | |||||||||||||||||
Derivative financial instruments (1) | |||||||||||||||||
Cash flow hedges | |||||||||||||||||
Cross-currency swap liability | $ | (523 | ) | $ | — | $ | (523 | ) | $ | — | |||||||
(US$ in thousands) | Balance | Level 1 | Level 2 | Level 3 | |||||||||||||
December 31, | |||||||||||||||||
2012 | |||||||||||||||||
Derivative financial instruments(1) | |||||||||||||||||
Cash flow hedges | |||||||||||||||||
Cross-currency swap asset | $ | 305 | $ | — | $ | 305 | $ | — | |||||||||
-1 | See Note 8, “Derivative Instruments” |
Comprehensive_income_loss
Comprehensive income (loss) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Equity [Abstract] | ' | ||||||||||||||||
Comprehensive income (loss) | ' | ||||||||||||||||
10 | Comprehensive income (loss) | ||||||||||||||||
Accumulated other comprehensive income is comprised of foreign currency translation adjustments and the effective portion of the gain (loss) on the Company’s cross-currency swap, which is designated and accounted for as a cash flow hedge. The components of and changes in accumulated other comprehensive income were as follows: | |||||||||||||||||
(US$ in thousands) | Foreign | Fair Value of | Accumulated | ||||||||||||||
Currency | Cross-Currency | Other | |||||||||||||||
Translation | Swap | Comprehensive | |||||||||||||||
Adjustments | Income | ||||||||||||||||
Balance at December 31, 2012 | $ | 4,614 | $ | 131 | $ | 4,745 | |||||||||||
Unrealized gain on cross-currency swap, net of tax of $275 | — | 486 | 486 | ||||||||||||||
Foreign currency translation adjustment (1) | (273 | ) | — | (273 | ) | ||||||||||||
Balance at September 30, 2013 | $ | 4,341 | $ | 617 | $ | 4,958 | |||||||||||
-1 | As the cash generally remains permanently invested in the non-U.S. dollar denominated foreign subsidiaries, no deferred taxes are recognized on the related foreign currency translation adjustment. | ||||||||||||||||
Comprehensive income (loss) was comprised of the following components: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(US$ in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
(Restated) | (Restated) | ||||||||||||||||
Net income (loss) | $ | (19,822 | ) | $ | 5,016 | $ | (17,639 | ) | $ | 21,677 | |||||||
Other comprehensive income (loss): | |||||||||||||||||
Unrealized gain (loss) on cross-currency swap, net of tax of $275 | 582 | 253 | 486 | 177 | |||||||||||||
Foreign currency translation adjustment | 3,176 | 1,171 | (273 | ) | 215 | ||||||||||||
Total comprehensive income (loss) | $ | (16,064 | ) | $ | 6,440 | $ | (17,426 | ) | $ | 22,069 | |||||||
Earnings_per_share
Earnings per share | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Earnings per share | ' | ||||||||||||||||
11 | Earnings per share | ||||||||||||||||
For the three and nine months ended September 30, 2013 and 2012, there were no adjustments to net income (loss) for purposes of calculating basic and diluted net income (loss) available to common shareholders. For the nine months ended September 30, 2013, potentially dilutive shares totaled 176,482. The following is a reconciliation of the weighted average shares used in the basic and diluted net income (loss) per common share computations. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Weighted average common shares-basic | 18,142,935 | 19,078,590 | 18,897,887 | 18,861,374 | |||||||||||||
Effect of dilutive securities: | |||||||||||||||||
Unexercised stock options net of treasury share repurchase | — | 454,431 | — | 438,889 | |||||||||||||
Weighted average common shares-diluted | 18,142,935 | 19,533,021 | 18,897,887 | 19,300,263 | |||||||||||||
Options to purchase shares of common stock with exercise prices in excess of the average market price of common shares are not included in the computation of diluted earnings per share. There were 1,647,878 and 1,186,259 outstanding options not included in the diluted earnings per share computation for the three and nine months ended September 30, 2013, respectively, because the inclusion of these options was antidilutive. There were 636,900 and 688,636 outstanding options not included, respectively, in the diluted earnings per share computation for the three and nine months ended September 30, 2012, respectively, because the inclusion of these options was anti-dilutive. |
Sharebased_compensation
Share-based compensation | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||||||||||
Share-based compensation | ' | ||||||||||||||||
12 | Share-based compensation | ||||||||||||||||
All share-based compensation costs are measured at the grant date, based on the estimated fair value of the award, and are recognized as expense in the condensed consolidated statements of operations over the requisite service period. | |||||||||||||||||
The following table shows the detail of share-based compensation by line item in the condensed consolidated statements of operations: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(US$ in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Cost of sales | $ | 27 | $ | 155 | $ | (249 | ) | $ | 438 | ||||||||
Sales and marketing | 469 | 598 | 1,375 | 1,440 | |||||||||||||
General and administrative | 726 | 1,309 | 3,431 | 2,851 | |||||||||||||
Research and development | 55 | 34 | 157 | 105 | |||||||||||||
Total | $ | 1,277 | $ | 2,096 | $ | 4,714 | $ | 4,834 | |||||||||
For the nine months ended September 30, 2013 and 2012, there were no performance requirements for share-based compensation awarded to employees. In March 2013, the Company granted options to its newly-appointed Chief Executive Officer, which vesting is based on achieving certain market prices for the Company’s common stock. | |||||||||||||||||
During the three and nine months ended September 30, 2013, there were 56,281 and 199,725 shares, respectively, of common stock issued related to stock purchase plan issuances, stock option exercises and the vesting of restricted stock awards. During the three and nine months ended September 30, 2012, there were 332,985 and 814,022 shares, respectively, of common stock issued related to stock purchase plan issuances, stock option exercises and the vesting of restricted stock awards. |
Income_taxes
Income taxes | 9 Months Ended | |
Sep. 30, 2013 | ||
Income Tax Disclosure [Abstract] | ' | |
Income taxes | ' | |
13 | Income taxes | |
The Company recognized $8.1 million and $17.0 million provision for income tax which reflects an effective tax rate of 456.0% and 37.5% on pre-tax loss for the nine months ended September 30, 2013 and pre-tax income for the nine months ended September 30, 2012. For the nine months ended September 30, 2012, $0.6 million of income related to legal settlements is discrete and not included in the foregoing calculation of the effective tax rate. Due to the significant variations in the customary relationship between income tax expense and pretax earnings resulting from extraordinary permanent items, the company provided for income taxes on a year to date basis for the nine months ended September 30, 2013. The principal factors affecting the Company’s effective tax rate was the company’s mix of earnings amongst various tax jurisdiction, state taxes, and permanent items related to the $19.2 million goodwill impairment in the current quarter. | ||
Excluding the impact of various discrete charges, the effective tax rate on continuing operations for the first nine months of 2012 was 38.8%. The principal factors affecting the Company’s effective tax rate was the Company’s mix of earnings among various tax jurisdictions, state taxes and current period losses in certain jurisdictions for which the Company does not currently provide a tax benefit. | ||
The Company applies a more likely than not recognition threshold for all tax uncertainties. Accounting guidance only allows the recognition of those tax benefits that have a greater than 50% likelihood of being sustained upon examination by the taxing authorities. As of September 30, 2013 and December 31, 2012, the Company’s gross unrecognized tax benefit was $0.7 million and $1.2 million, respectively. In March 2013 the Company settled a $0.9 million liability that had been previously accrued as of December 31, 2012. The entire amount of unrecognized tax benefits, including interest, would favorably impact the Company’s effective tax rate if recognized. As of September 30, 2013, the Company does not expect the amount of unrecognized tax benefits to change significantly over the next twelve months. | ||
Unremitted foreign earnings increased from $285.3 million at December 31, 2011 to $292.0 million at December 31, 2012. The $292.0 million includes $293.8 million in U.S subsidiaries. The Company does not anticipate any impact on income tax liabilities since earnings are permanently reinvested for both U.S and non-U.S. subsidiaries. |
Business_segment_information
Business segment information | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Business segment information | ' | ||||||||||||||||
14 | Business segment information | ||||||||||||||||
On July 1, 2013, we began certain organizational and executive leadership changes to align with how our Chief Operating Decision Maker (the “CODM”) reviews performance and makes decisions in managing the Company. We manage our business by our four strategic business units (“SBUs”), which are comprised of BioStim, Biologics, Spine Fixation, and Extremity Fixation supported by Corporate activities. These SBUs represent the segments for which our CODM reviews financial information and makes resource allocation decisions among business units. The primary metric used by the Chief Operating Decision Maker in managing the Company is net margin, which is defined as gross profit less sales and marketing expense. The Company neither discretely allocates assets, other than goodwill, to its operating segments nor evaluates the operating segments using discrete asset information. Accordingly, our segment information has been prepared based on our four SBUs reporting segments. These four segments are discussed below. | |||||||||||||||||
BioStim | |||||||||||||||||
The BioStim Strategic Business Unit manufactures, distributes, and provides support services for a portfolio of market leading devices for enhancing bone fusion that utilize Orthofix’s patented pulsed electromagnetic (PEMF) technology. These Food and Drug Administration-approved Class 3 medical devices are indicated as an adjunctive treatment to enhance fusion success in cervical and lumbar spine as well as a therapeutic treatment for non-healing fractures outside of the spine (non-unions). The PEMF technology is supported by a strong clinical background on mechanism of action in the scientific literature and current research and clinical studies are underway to identify potential new clinical indications. | |||||||||||||||||
Biologics | |||||||||||||||||
Biologics provides a portfolio of regenerative products that allow physicians to successfully treat a variety of spinal and orthopedic conditions. This SBU specializes in the marketing of the Company’s regeneration tissue forms. Biologics distributes its tissues through a network of distributors, sales representatives and affiliates to market to hospitals, doctors, and other healthcare providers, primarily in the U.S. Our partnership with MTF allows us to exclusively market our Trinity Evolution® and Trinity Elite™ tissue forms for musculoskeletal defects to enhance bony fusion. | |||||||||||||||||
Spine Fixation | |||||||||||||||||
The Spine Fixation strategic business unit specializes in the design, development and marketing of a portfolio of implant products used in surgical procedures of the spine. Spine Fixation distributes its products through a network of distributors and affiliates. This strategic business unit uses distributor sales representatives to sell spine products to hospitals, doctors and other healthcare providers, globally. | |||||||||||||||||
Extremity Fixation | |||||||||||||||||
Extremity Fixation offers products that allow physicians to successfully treat a variety of orthopedic conditions unrelated to the spine. This strategic business unit specializes in the design, development, and marketing of the Company’s orthopedic products used in fracture repair, deformity correction and bone reconstruction. Extremity Fixation distributes its products through a network of distributors, sales representatives, and affiliates. This strategic business units uses both direct and distributor sales representatives to sell orthopedics products to hospitals, doctors, and other health providers, globally. | |||||||||||||||||
Corporate | |||||||||||||||||
Corporate activities are comprised of the operating expenses of Orthofix International N.V. and its holding company subsidiaries, along with activities not necessarily identifiable within the four SBUs. | |||||||||||||||||
The accounting policies of the segments are the same as those described in the business segment information found in Note 13, “Business segment information” to the Consolidated Financial Statements included in the 2012 Form 10-K/A. | |||||||||||||||||
The table below presents external net sales by SBU reporting segment (amounts reported for prior periods have been reclassified to conform to our new segment reporting structure). Net sales include product sales and marketing service fees. Marketing service fees, which are recorded on a net basis, are comprised of fees earned for the marketing of Trinity Evolution®, Trinity ELITE™ and Versashield® in our Biologics segment. | |||||||||||||||||
External Net Sales by SBU | |||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||
(US$ in thousands) | 2013 | 2012 | Reported | Constant | |||||||||||||
Growth | Currency | ||||||||||||||||
Growth | |||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||
BioStim | $ | 31,604 | $ | 42,310 | (25 | )% | (28 | )% | |||||||||
Biologics | 13,212 | 12,951 | 2 | % | 2 | % | |||||||||||
Spine Fixation | 23,221 | 25,001 | (7 | )% | (7 | )% | |||||||||||
Extremity Fixation | 24,701 | 27,595 | (10 | )% | (9 | )% | |||||||||||
Total Net Sales | $ | 92,738 | $ | 107,857 | (14 | )% | (15 | )% | |||||||||
External Net Sales by SBU | |||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||
(US$ in thousands) | 2013 | 2012 | Reported | Constant | |||||||||||||
Growth | Currency | ||||||||||||||||
Growth | |||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||
BioStim | $ | 108,445 | $ | 134,741 | (20 | )% | (20 | )% | |||||||||
Biologics | 39,827 | 39,792 | — | % | — | % | |||||||||||
Spine Fixation | 71,994 | 72,972 | (1 | )% | (1 | )% | |||||||||||
Extremity Fixation | 74,125 | 82,711 | (10 | )% | (8 | )% | |||||||||||
Total Net Sales | $ | 294,391 | $ | 330,216 | (11 | )% | (11 | )% | |||||||||
The table below presents net margin, defined as gross profit less sales and marketing expenses, from continuing operations by SBU reporting segment: | |||||||||||||||||
Net margin by SBU | Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | ||||||||||||||||
(US$ in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
(Restated) | (Restated) | ||||||||||||||||
Net margin: | |||||||||||||||||
BioStim | $ | 10,614 | $ | 19,367 | $ | 45,911 | $ | 66,354 | |||||||||
Biologics | 6,743 | 5,664 | 18,472 | 16,524 | |||||||||||||
Spine Fixation | 1,227 | 4,693 | 7,489 | 13,379 | |||||||||||||
Extremity Fixation | 8,321 | 11,145 | 21,766 | 24,508 | |||||||||||||
Corporate | (469 | ) | (418 | ) | (1,376 | ) | (1,083 | ) | |||||||||
Total net margin | 26,436 | 40,451 | 92,262 | 119,682 | |||||||||||||
General and administrative | 13,202 | 13,850 | 46,736 | 42,715 | |||||||||||||
Research and development | 6,361 | 6,858 | 20,653 | 23,160 | |||||||||||||
Amortization of intangible assets | 616 | 565 | 1,725 | 1,725 | |||||||||||||
Costs related to the accounting review and restatement | 2,664 | 2,664 | |||||||||||||||
Impairment of goodwill | 19,193 | — | 19,193 | — | |||||||||||||
Charges related to U.S. Government resolutions | — | 373 | — | 1,059 | |||||||||||||
Operating income (loss) | $ | (15,600 | ) | $ | 18,805 | $ | 1,291 | $ | 51,023 | ||||||||
Sale_of_Breg_and_Disposition_o
Sale of Breg and Disposition of Sports Medicine SBU | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Discontinued Operations And Disposal Groups [Abstract] | ' | ||||
Sale of Breg and Disposition of Sports Medicine SBU | ' | ||||
15 | Sale of Breg and Disposition of Sports Medicine SBU | ||||
On April 23, 2012, the Company’s subsidiary Orthofix Holdings and Breg entered into a stock purchase agreement (the “SPA”) with Breg Acquisition Corp. (“Buyer”), a newly formed affiliate of Water Street Healthcare Partners II, L.P., pursuant to which Buyer agreed to acquire from Orthofix Holdings all the outstanding shares of Breg, subject to the terms and conditions contained therein (the “Transaction”). Under the terms of the SPA, upon closing of the sale, Orthofix Holdings and the Company agreed to indemnify Buyer with respect to certain specified matters, including the government investigation and product liability matters regarding a previously owned infusion pump product line, pre-closing sales of cold therapy units and certain post-closing sales of cold therapy units. (See “Matters Related to the Company’s Former Breg Subsidiary and Possible Indemnification Obligations” under Note 17 to the Consolidated Financial Statements included in the 2012 Form 10-K/A, “Contingencies”.) On May 24, 2012 (the “Closing Date”), Orthofix Holdings completed the sale of all of the outstanding shares of Breg for $157.5 million in cash. After adjustments for working capital and indebtedness in accordance with the terms of the SPA, Orthofix Holdings used $145 million of the net proceeds to prepay outstanding Company indebtedness, as required by a lender consent received in connection with the Company’s existing Credit Agreement. As a result of the closing of this Transaction, Breg ceased to be a subsidiary of the Company and, therefore, Breg was released as a credit party under the Credit Agreement. The Company also agreed to enter into certain transition arrangements at the closing, including a transition services agreement pursuant to which the Company agreed to continue to provide administrative operational support for a period of up to twelve months. As a result of the sale of Breg, the Company completed its exit from the Sports Medicine SBU, of which Breg was a significant component. | |||||
The portion of indemnification related to post closing claims related to post-closing sales of cold therapy has created a guarantee under Accounting Standards Codification ASC 460, Guarantees, and the fair value of the liability has been recorded under the initial recognition criteria in the amount of $2 million at the Closing Date. The Company will amortize the fair value of the noncontingent liability ratably over the period of indemnification, which is three years. The Company’s obligations under this guarantee were approximately $1.1 million and $1.6 million as of September 30, 2013 and December 31, 2012, respectively. | |||||
Gain on Sale of Discontinued Operations | |||||
The following table presents the value of the asset disposition, proceeds received, net of various working capital adjustments and indebtedness and net gain on sale of Breg as shown in the condensed consolidated statement of operations for the year ended December 31, 2012. | |||||
(US$ in thousands) | Total | ||||
Cash proceeds | $ | 157,500 | |||
Less: | |||||
Working Capital | (7,093 | ) | |||
Transaction related expenses | (4,276 | ) | |||
Fair value of indemnification | (2,000 | ) | |||
Tangible assets | (8,309 | ) | |||
Intangible assets | (28,164 | ) | |||
Goodwill | (106,200 | ) | |||
Gain on sale of Breg, before taxes | 1,458 | ||||
Income tax expense | (113 | ) | |||
Gain on sale of Breg, net of taxes | $ | 1,345 | |||
Included in discontinued operations for the three and nine months ended September 30, 2013 is $3.1 million and $15.8 million, respectively, of expense related to the Company’s indemnification of certain specified matters described above. | |||||
The Company’s condensed consolidated financial statements and related footnote disclosures reflect the Sports Medicine SBU as discontinued operations. Income (loss) associated with the Sports Medicine SBU, net of applicable income taxes is shown as income (loss) from discontinued operations for all periods presented in accordance with ASC 205-20, Discontinued Operations. |
Contingencies
Contingencies | 9 Months Ended | |
Sep. 30, 2013 | ||
Commitments And Contingencies Disclosure [Abstract] | ' | |
Contingencies | ' | |
16 | Contingencies | |
The Company is a party to certain outstanding legal proceedings, investigations and claims. These matters (including certain matters occurring in 2013) are described in the 2012 Form 10-K/A. There have been no material developments in these matters since the filing of the 2012 Form 10-K/A. |
Stock_Repurchase_Program
Stock Repurchase Program | 9 Months Ended | |
Sep. 30, 2013 | ||
Text Block [Abstract] | ' | |
Stock Repurchase Program | ' | |
17 | Stock Repurchase Program | |
On May 8, 2013, the Company announced that the Board of Directors had authorized a share repurchase program in an amount up to $50 million. Repurchases began on May 10, 2013 consisting primarily of open market transactions at prevailing market prices in accordance with the guidelines specified under Rule 10b-18 of the Securities Exchange Act of 1934, as amended. Repurchases are being made from cash on hand, cash generated from operations and additional borrowings. The timing of the transactions and the aggregate number of shares of common stock that will be ultimately repurchased under the repurchase program will depend on a variety of factors, including market conditions and the prices at which the securities are repurchased. The Company may discontinue repurchases without prior notice at any time if the Company determines additional repurchases are not warranted. During the fiscal quarter ended September 30, 2013, the Company made total repurchases in an amount equal to $12.6 million. The Company has not made any further purchases between September 30, 2013 and the date of this Form 10-Q. To date, the Company has made total repurchases in an amount equal to $39.5 million. |
Subsequent_Event
Subsequent Event | 9 Months Ended | |
Sep. 30, 2013 | ||
Subsequent Events [Abstract] | ' | |
Subsequent Event | ' | |
18 | Subsequent Event | |
We have been delinquent in the filing of our Quarterly Reports on Form 10-Q for the fiscal quarters ended June 30, 2013 and September 30, 2013, as a result of which we have not been in compliance with the rules of the Nasdaq Stock Market and are subject to having our stock delisted from trading on Nasdaq. We have been granted a stay of the delisting of our common stock until such time as a Nasdaq Hearings Panel makes a decision on the merits following a hearing, which hearing has been scheduled for March 27, 2014. We expect to file our Annual Report on Form 10-K for the year ended December 31, 2013 (which is otherwise due under SEC rules on March 17, 2014) by March 31, 2014. As a result, we currently believe that we will adequately remedy our current non-compliance with Nasdaq’s listing rules. However, there can be no assurance that the Nasdaq hearings panel will concur with our belief that we have remedied our prior non-compliance, in which case our common stock could remain subject to delisting by Nasdaq. |
Summary_of_significant_account1
Summary of significant accounting policies (Policies) | 9 Months Ended | ||
Sep. 30, 2013 | |||
Accounting Policies [Abstract] | ' | ||
Basis of presentation | ' | ||
(a) | Basis of presentation | ||
The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S.”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Pursuant to these rules and regulations, certain information and note disclosures, normally included in financial statements prepared in accordance with accounting principles generally accepted in the U.S., have been condensed or omitted. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. The balance sheet at December 31, 2012 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by accounting principles generally accepted in the U.S. for complete financial statements. For further information, refer to the Consolidated Financial Statements and Notes thereto of the 2012 Form 10-K/A. The notes to the unaudited condensed consolidated financial statements are presented on a continuing basis unless otherwise noted. | |||
Reclassifications | ' | ||
(b) | Reclassifications | ||
The Company has reclassified certain line items to conform to the current year presentation. The reclassifications have no effect on previously reported net income or shareholders’ equity. | |||
Use of estimates | ' | ||
(c) | Use of estimates | ||
The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an ongoing basis, the Company evaluates its estimates including those related to the resolution of U.S. government matters, contractual allowances, doubtful accounts, inventories, taxes, shared-based compensation, and potential goodwill and intangible asset impairment. Actual results could differ from these estimates. | |||
Foreign Currency Translation | ' | ||
(d) | Foreign Currency Translation | ||
The financial statements for operations outside the United States are generally maintained in their local currency. All foreign currency denominated balance sheet accounts, except shareholders’ equity, are translated to U.S. dollars at year end exchange rates and revenue and expense items are translated at weighted average rates of exchange prevailing during the year. Gains and losses resulting from the translation of foreign currency are recorded in the accumulated other comprehensive income component of shareholders’ equity. | |||
Goodwill | ' | ||
(e) | Goodwill | ||
The Company generally calculates fair value of indefinite-lived intangible assets as the present value of estimated future cash flows. In determining the estimated future cash flows associated with intangible assets, the Company uses estimates and assumptions about future revenue contributions, cost structures and remaining useful lives of the asset (asset group). The use of alternative assumptions, including estimated cash flows, discount rates, and alternative estimated remaining useful lives could result in different calculations of impairment. | |||
The Company tests goodwill at least annually for impairment. The Company tests more frequently if indicators are present or changes in circumstances suggest that impairment may exist. These indicators include, among others, declines in sales, earnings or cash flows, or the development of a material adverse change in the business climate. The Company assesses goodwill for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment, referred to as a reporting unit. | |||
In order to calculate the respective carrying values, the Company initially recorded goodwill based on the purchase price allocation performed at the time of acquisition. Corporate assets and liabilities that directly relate to a reporting unit’s operations are ascribed directly to that reporting unit. Corporate assets and liabilities that are not directly related to a specific reporting unit, but from which the reporting unit benefits, are allocated based on the respective contribution measure of each reporting unit. Effective July 1, 2013, the Company re-aligned its segments and consequently reallocated the carrying value of goodwill from its previous reporting units to its new reporting units based on the relative fair value of each new reporting unit to total enterprise value at July 1, 2013. | |||
In the first quarter of 2012, ASU 2011-08, “Testing of Goodwill for Impairment” became effective. ASU 2011-08 allows entities testing goodwill for impairment the option of performing a qualitative assessment before calculating the fair value of a reporting unit (i.e. the first step of the goodwill impairment test). If entities determine, on the basis of qualitative factors, that the fair value of the reporting unit is more likely than not greater than the carrying amount, a quantitative calculation would not be needed. | |||
As a result of the Company’s change in reportable segments, the Company allocated goodwill to each reportable segment, and subsequently evaluated the Spine Fixation and Extremity Fixation reportable units for the possible impairment of goodwill under step two, as there were indicators of impairment when completing step one. The result of this step two analysis was a full impairment of the goodwill allocated to our Spine Fixation and our Extremity Fixation reportable units, totaling $19.2 million. See Note 5, “Goodwill” for details. | |||
. |
Restatement_of_the_Condensed_C1
Restatement of the Condensed Consolidated Financial Statements (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||
Text Block [Abstract] | ' | ||||||||||||||||||||||||||||
Adjustments to Previously Filed Consolidated Statements of Operations | ' | ||||||||||||||||||||||||||||
The results of the adjustments to the Company’s previously filed consolidated statements of operations detailed above for the three and nine months ended September 30, 2012 are summarized in the tables below. The tax effect of the adjustments is estimated based on the Company’s effective tax rate. | |||||||||||||||||||||||||||||
Three Months Ended September 30, 2012 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 114,752 | $ | (6,422 | ) | $ | — | $ | — | $ | (473 | ) | $ | (6,895 | ) | $ | 107,857 | ||||||||||||
Cost of sales | 22,373 | (265 | ) | 123 | 2,018 | 135 | 2,011 | 24,384 | |||||||||||||||||||||
Gross profit | 92,379 | (6,157 | ) | (123 | ) | (2,018 | ) | (608 | ) | (8,906 | ) | 83,473 | |||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 49,298 | (4,212 | ) | — | (2,018 | ) | (46 | ) | (6,276 | ) | 43,022 | ||||||||||||||||||
General and administrative | 13,850 | — | — | — | — | — | 13,850 | ||||||||||||||||||||||
Research and development | 6,858 | — | — | — | — | — | 6,858 | ||||||||||||||||||||||
Amortization of intangibles assets | 515 | — | — | — | 50 | 50 | 565 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | 325 | — | — | — | 48 | 48 | 373 | ||||||||||||||||||||||
70,846 | (4,212 | ) | — | (2,018 | ) | 52 | (6,178 | ) | 64,668 | ||||||||||||||||||||
Operating income | 21,533 | (1,945 | ) | (123 | ) | — | (660 | ) | (2,728 | ) | 18,805 | ||||||||||||||||||
Other income and (expense) | (1,485 | ) | — | — | — | — | — | (1,485 | ) | ||||||||||||||||||||
Income before income taxes | 20,048 | (1,945 | ) | (123 | ) | — | (660 | ) | (2,728 | ) | 17,320 | ||||||||||||||||||
Income tax (expense) | (6,930 | ) | 131 | 8 | — | 45 | 184 | (6,746 | ) | ||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 13,118 | $ | (1,814 | ) | $ | (115 | ) | $ | — | $ | (615 | ) | $ | (2,544 | ) | $ | 10,574 | |||||||||||
Nine Months Ended September 30, 2012 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 350,286 | $ | (19,678 | ) | $ | — | $ | — | $ | (392 | ) | $ | (20,070 | ) | $ | 330,216 | ||||||||||||
Cost of sales | 67,989 | (3,837 | ) | 2,791 | 6,223 | 143 | 5,320 | 73,309 | |||||||||||||||||||||
Gross profit | 282,297 | (15,841 | ) | (2,791 | ) | (6,223 | ) | (535 | ) | (25,390 | ) | 256,907 | |||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 148,629 | (5,156 | ) | — | (6,223 | ) | (25 | ) | (11,404 | ) | 137,225 | ||||||||||||||||||
General and administrative | 42,715 | — | — | — | — | — | 42,715 | ||||||||||||||||||||||
Research and development | 23,160 | — | — | — | — | — | 23,160 | ||||||||||||||||||||||
Amortization of intangibles assets | 1,575 | — | — | — | 150 | 150 | 1,725 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | 1,689 | — | — | — | (630 | ) | (630 | ) | 1,059 | ||||||||||||||||||||
217,768 | (5,156 | ) | — | (6,223 | ) | (505 | ) | (11,884 | ) | 205,884 | |||||||||||||||||||
Operating income | 64,529 | (10,685 | ) | (2,791 | ) | — | (30 | ) | (13,506 | ) | 51,023 | ||||||||||||||||||
Other income and (expense) | (4,942 | ) | — | — | — | — | — | (4,942 | ) | ||||||||||||||||||||
Income before income taxes | 59,587 | (10,685 | ) | (2,791 | ) | — | (30 | ) | (13,506 | ) | 46,081 | ||||||||||||||||||
Income tax (expense) | (20,286 | ) | 2,340 | 1,111 | — | (205 | ) | 3,246 | (17,040 | ) | |||||||||||||||||||
Net income from continuing operations, net of tax | $ | 39,301 | $ | (8,345 | ) | $ | (1,680 | ) | $ | — | $ | (235 | ) | $ | (10,260 | ) | $ | 29,041 | |||||||||||
Effects of Restatements on Consolidated Balance Sheet | ' | ||||||||||||||||||||||||||||
The effects of the restatement on the Company’s condensed consolidated balance sheet as of December 31, 2012 are as follows: | |||||||||||||||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||||||||||
(Unaudited, U.S. Dollars, in thousands, except share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 31,055 | $ | — | $ | 31,055 | |||||||||||||||||||||||
Restricted cash | 21,314 | — | 21,314 | ||||||||||||||||||||||||||
Trade accounts receivable, less allowances of $13,543 | 150,316 | (43,004 | ) | 107,312 | |||||||||||||||||||||||||
Inventories | 88,744 | (5,371 | ) | 83,373 | |||||||||||||||||||||||||
Deferred income taxes | 16,959 | 16,491 | 33,450 | ||||||||||||||||||||||||||
Prepaid expenses and other current assets | 32,056 | 2,023 | 34,079 | ||||||||||||||||||||||||||
Total current assets | 340,444 | (29,861 | ) | 310,583 | |||||||||||||||||||||||||
Property, plant and equipment, net | 51,362 | 2,473 | 53,835 | ||||||||||||||||||||||||||
Patents and other intangible assets, net | 6,880 | 410 | 7,290 | ||||||||||||||||||||||||||
Goodwill | 74,388 | — | 74,388 | ||||||||||||||||||||||||||
Deferred income taxes | 19,904 | (1,023 | ) | 18,881 | |||||||||||||||||||||||||
Other long-term assets | 11,303 | (3,383 | ) | 7,920 | |||||||||||||||||||||||||
Total assets | $ | 504,281 | $ | (31,384 | ) | $ | 472,897 | ||||||||||||||||||||||
Liabilities and shareholders’ equity | |||||||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||||||
Trade accounts payable | $ | 21,812 | 763 | $ | 22,575 | ||||||||||||||||||||||||
Other current liabilities | 46,985 | (7,375 | ) | 39,610 | |||||||||||||||||||||||||
Total current liabilities | 68,797 | (6,612 | ) | 62,185 | |||||||||||||||||||||||||
Long-term debt | 20,000 | — | 20,000 | ||||||||||||||||||||||||||
Deferred income taxes | 11,456 | — | 11,456 | ||||||||||||||||||||||||||
Other long-term liabilities | 4,930 | 6,494 | 11,424 | ||||||||||||||||||||||||||
Total liabilities | 105,183 | (118 | ) | 105,065 | |||||||||||||||||||||||||
Contingencies (Note 16) | |||||||||||||||||||||||||||||
Shareholders’ equity: | |||||||||||||||||||||||||||||
Common shares $0.10 par value; 50,000,000 shares authorized; 19,339,329 issued and outstanding | 1,934 | — | 1,934 | ||||||||||||||||||||||||||
Additional paid-in capital | 246,111 | 195 | 246,306 | ||||||||||||||||||||||||||
Retained earnings | 148,549 | (33,702 | ) | 114,847 | |||||||||||||||||||||||||
Accumulated other comprehensive income | 2,504 | 2,241 | 4,745 | ||||||||||||||||||||||||||
Total shareholders’ equity | 399,098 | (31,266 | ) | 367,832 | |||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 504,281 | $ | (31,384 | ) | $ | 472,897 | ||||||||||||||||||||||
Effects of Restatement of Consolidated Statement of Operations and Comprehensive Income (Loss) | ' | ||||||||||||||||||||||||||||
The effects of the restatements on the Company’s condensed consolidated statement of operations and comprehensive income for the three months ended September 30, 2012 are as follows: | |||||||||||||||||||||||||||||
(Unaudited, U.S. Dollars, in thousands, except share and per share data) | Three Months Ended September 30, 2012 | ||||||||||||||||||||||||||||
Previously | Adjustments | Restated | |||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 103,111 | $ | (6,559 | ) | $ | 96,552 | ||||||||||||||||||||||
Marketing service fees | 11,641 | (336 | ) | 11,305 | |||||||||||||||||||||||||
Net sales | 114,752 | (6,895 | ) | 107,857 | |||||||||||||||||||||||||
Cost of sales | 22,373 | 2,011 | 24,384 | ||||||||||||||||||||||||||
Gross profit | 92,379 | (8,906 | ) | 83,473 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 49,298 | (6,276 | ) | 43,022 | |||||||||||||||||||||||||
General and administrative | 13,850 | — | 13,850 | ||||||||||||||||||||||||||
Research and development | 6,858 | — | 6,858 | ||||||||||||||||||||||||||
Amortization of intangible assets | 515 | 50 | 565 | ||||||||||||||||||||||||||
Impairment of goodwill | — | — | — | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions | 325 | 48 | 373 | ||||||||||||||||||||||||||
70,846 | (6,178 | ) | 64,668 | ||||||||||||||||||||||||||
Operating income | 21,533 | (2,728 | ) | 18,805 | |||||||||||||||||||||||||
Other income and expense | |||||||||||||||||||||||||||||
Interest expense, net | (464 | ) | — | (464 | ) | ||||||||||||||||||||||||
Other expense | (1,021 | ) | — | (1,021 | ) | ||||||||||||||||||||||||
(1,485 | ) | — | (1,485 | ) | |||||||||||||||||||||||||
Income before income taxes | 20,048 | (2,728 | ) | 17,320 | |||||||||||||||||||||||||
Income tax expense | (6,930 | ) | 184 | (6,746 | ) | ||||||||||||||||||||||||
Net income from continuing operations, net of tax | 13,118 | (2,544 | ) | 10,574 | |||||||||||||||||||||||||
Discontinued operations (Note 15) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | 221 | — | 221 | ||||||||||||||||||||||||||
Loss from discontinued operations | (9,046 | ) | (2 | ) | (9,048 | ) | |||||||||||||||||||||||
Income tax benefit | 3,267 | 2 | 3,269 | ||||||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (5,558 | ) | — | (5,558 | ) | ||||||||||||||||||||||||
Net income | $ | 7,560 | $ | (2,544 | ) | $ | 5,016 | ||||||||||||||||||||||
Net income (loss) per common share-basic: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.69 | $ | (0.14 | ) | $ | 0.55 | ||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.29 | ) | — | (0.29 | ) | ||||||||||||||||||||||||
Net income per common share-basic | $ | 0.4 | $ | (0.14 | ) | $ | 0.26 | ||||||||||||||||||||||
Net income (loss) per common share-diluted: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.67 | $ | (0.13 | ) | $ | 0.54 | ||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.28 | ) | (0.01 | ) | (0.29 | ) | |||||||||||||||||||||||
Net income per common share-diluted | $ | 0.39 | $ | (0.14 | ) | $ | 0.25 | ||||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 19,078,590 | — | 19,078,590 | ||||||||||||||||||||||||||
Diluted | 19,533,021 | — | 19,533,021 | ||||||||||||||||||||||||||
Comprehensive income | $ | 9,067 | $ | (2,627 | ) | $ | 6,440 | ||||||||||||||||||||||
The effects of the restatements on the Company’s condensed consolidated statement of operations and comprehensive income for the nine months ended September 30, 2012 are as follows: | |||||||||||||||||||||||||||||
(Unaudited, U.S. Dollars, in thousands, except share and per share data) | Nine Months Ended September 30, 2012 | ||||||||||||||||||||||||||||
Previously | Adjustments | Restated | |||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 315,837 | $ | (19,775 | ) | $ | 296,062 | ||||||||||||||||||||||
Marketing service fees | 34,449 | (295 | ) | 34,154 | |||||||||||||||||||||||||
Net sales | 350,286 | (20,070 | ) | 330,216 | |||||||||||||||||||||||||
Cost of sales | 67,989 | 5,320 | 73,309 | ||||||||||||||||||||||||||
Gross profit | 282,297 | (25,390 | ) | 256,907 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 148,629 | (11,404 | ) | 137,225 | |||||||||||||||||||||||||
General and administrative | 42,715 | — | 42,715 | ||||||||||||||||||||||||||
Research and development | 23,160 | — | 23,160 | ||||||||||||||||||||||||||
Amortization of intangible assets | 1,575 | 150 | 1,725 | ||||||||||||||||||||||||||
Impairment of goodwill | — | — | — | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions | 1,689 | (630 | ) | 1,059 | |||||||||||||||||||||||||
217,768 | (11,884 | ) | 205,884 | ||||||||||||||||||||||||||
Operating income | 64,529 | (13,506 | ) | 51,023 | |||||||||||||||||||||||||
Other income and expense | |||||||||||||||||||||||||||||
Interest expense, net | (3,950 | ) | — | (3,950 | ) | ||||||||||||||||||||||||
Other expense | (992 | ) | — | (992 | ) | ||||||||||||||||||||||||
(4,942 | ) | — | (4,942 | ) | |||||||||||||||||||||||||
Income before income taxes | 59,587 | (13,506 | ) | 46,081 | |||||||||||||||||||||||||
Income tax expense | (20,286 | ) | 3,246 | (17,040 | ) | ||||||||||||||||||||||||
Net income from continuing operations, net of tax | 39,301 | (10,260 | ) | 29,041 | |||||||||||||||||||||||||
Discontinued operations (Note 15) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | 1,261 | — | 1,261 | ||||||||||||||||||||||||||
Loss from discontinued operations | (15,398 | ) | 1,024 | (14,374 | ) | ||||||||||||||||||||||||
Income tax benefit | 5,617 | 132 | 5,749 | ||||||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (8,520 | ) | 1,156 | (7,364 | ) | ||||||||||||||||||||||||
Net income | $ | 30,781 | $ | (9,104 | ) | $ | 21,677 | ||||||||||||||||||||||
Net income (loss) per common share-basic: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 2.08 | $ | (0.54 | ) | $ | 1.54 | ||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.45 | ) | 0.06 | (0.39 | ) | ||||||||||||||||||||||||
Net income per common share-basic | $ | 1.63 | $ | (0.48 | ) | $ | 1.15 | ||||||||||||||||||||||
Net income (loss) per common share-diluted: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 2.04 | $ | (0.53 | ) | $ | 1.51 | ||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.45 | ) | 0.07 | (0.38 | ) | ||||||||||||||||||||||||
Net income per common share-diluted | $ | 1.59 | $ | (0.46 | ) | $ | 1.13 | ||||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 18,861,374 | — | 18,861,374 | ||||||||||||||||||||||||||
Diluted | 19,300,263 | — | 19,300,263 | ||||||||||||||||||||||||||
Comprehensive income | $ | 30,615 | $ | (8,657 | ) | $ | 20,751 |
Inventories_Tables
Inventories (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Schedule of Inventories, Net of Reserves | ' | ||||||||
Inventories, net of reserves, were as follows: | |||||||||
(US$ in thousands) | September 30, | December 31, | |||||||
2013 | 2012 | ||||||||
(Restated) | |||||||||
Raw materials | $ | 6,038 | $ | 7,623 | |||||
Work-in-process | 8,230 | 7,886 | |||||||
Finished products | 40,682 | 28,308 | |||||||
Field inventory | 31,682 | 22,629 | |||||||
Consignment inventory | 4,589 | 6,155 | |||||||
Deferred cost of sales | 8,983 | 10,772 | |||||||
Total Inventory | $ | 100,204 | $ | 83,373 | |||||
Patents_and_other_intangible_a1
Patents and other intangible assets (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||
Schedule of Patents and Other Intangible Assets | ' | ||||||||
(US$ in thousands) | September 30, | December 31, | |||||||
2013 | 2012 | ||||||||
(Restated) | |||||||||
Cost | |||||||||
Patents | $ | 41,135 | $ | 38,905 | |||||
Trademarks — definite lived | 632 | 657 | |||||||
41,767 | 39,562 | ||||||||
Accumulated amortization | |||||||||
Patents | (31,487 | ) | (31,845 | ) | |||||
Trademarks — definite lived | (459 | ) | (427 | ) | |||||
(31,946 | ) | (32,272 | ) | ||||||
Patents and other intangible assets, net | $ | 9,821 | $ | 7,290 | |||||
Goodwill_Tables
Goodwill (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||
Schedule of Changes in Net Carrying Amount of Goodwill | ' | ||||||||||||||||||||||||||||
The following table presents the changes in the net carrying value of goodwill by reportable segment as well as the reallocation and impairment of goodwill as of July 1, 2013 in conjunction with our change in reportable segments. (See Note 1 “Summary of significant accounting policies”): | |||||||||||||||||||||||||||||
(US$ in thousands) | Spine | Orthopedics | BioStim | Biologics | Spine | Extremity | Total | ||||||||||||||||||||||
Fixation | Fixation | ||||||||||||||||||||||||||||
At December 31, 2011 | $ | 41,419 | $ | 31,675 | $ | — | $ | — | $ | — | $ | — | $ | 73,094 | |||||||||||||||
Foreign currency | 145 | 1,149 | — | — | — | — | 1,294 | ||||||||||||||||||||||
At December 31, 2012 | 41,564 | 32,824 | — | — | — | — | 74,388 | ||||||||||||||||||||||
Foreign currency | (163 | ) | (1,467 | ) | — | — | — | — | (1,630 | ) | |||||||||||||||||||
At June 30, 2013 | 41,401 | 31,357 | — | — | — | — | 72,758 | ||||||||||||||||||||||
Reallocation at July 1, 2013 | (41,401 | ) | (31,357 | ) | 42,678 | 10,887 | 9,368 | 9,825 | — | ||||||||||||||||||||
Impairment | — | — | — | — | (9,368 | ) | (9,825 | ) | (19,193 | ) | |||||||||||||||||||
Foreign currency | — | — | 1,472 | 368 | — | — | 1,840 | ||||||||||||||||||||||
At September 30, 2013 | $ | — | $ | — | $ | 44,150 | $ | 11,255 | $ | — | $ | — | $ | 55,405 | |||||||||||||||
Derivative_instruments_Tables
Derivative instruments (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||
Schedule of Fair Values of Derivative Instruments | ' | ||||||||||||||||
The tables below disclose the types of derivative instruments the Company owns, the classifications and fair values of these instruments within the balance sheet, and the amount of gain (loss) recognized in other comprehensive income (loss) (“OCI”) or net income (loss). | |||||||||||||||||
(US$ in thousands) | Fair value: favorable | Balance sheet location | |||||||||||||||
As of September 30, 2013 | (unfavorable) | ||||||||||||||||
Cross-currency swap | $ | (523 | ) | Other long-term liabilities | |||||||||||||
As of December 31, 2012 | |||||||||||||||||
Cross-currency swap | $ | 305 | Other long-term assets | ||||||||||||||
Schedule of Gain (Loss) Recognized on Derivative Instruments | ' | ||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(US$ in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Cross-currency swap unrealized gain (loss) recorded in other comprehensive income (loss), net of taxes | $ | 582 | $ | 253 | $ | 486 | $ | 177 |
Fair_value_measurements_Tables
Fair value measurements (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Schedule of Financial Assets and Liabilities Recorded at Fair Value on Recurring Basis | ' | ||||||||||||||||
The fair value of the Company’s financial assets and liabilities on a recurring basis were as follows: | |||||||||||||||||
(US$ in thousands) | Balance | Level 1 | Level 2 | Level 3 | |||||||||||||
September 30, | |||||||||||||||||
2013 | |||||||||||||||||
Derivative financial instruments (1) | |||||||||||||||||
Cash flow hedges | |||||||||||||||||
Cross-currency swap liability | $ | (523 | ) | $ | — | $ | (523 | ) | $ | — | |||||||
(US$ in thousands) | Balance | Level 1 | Level 2 | Level 3 | |||||||||||||
December 31, | |||||||||||||||||
2012 | |||||||||||||||||
Derivative financial instruments(1) | |||||||||||||||||
Cash flow hedges | |||||||||||||||||
Cross-currency swap asset | $ | 305 | $ | — | $ | 305 | $ | — | |||||||||
-1 | See Note 8, “Derivative Instruments” |
Comprehensive_income_loss_Tabl
Comprehensive income (loss) (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Equity [Abstract] | ' | ||||||||||||||||
Schedule of Components of Changes in Accumulated Other Comprehensive Income | ' | ||||||||||||||||
The components of and changes in accumulated other comprehensive income were as follows: | |||||||||||||||||
(US$ in thousands) | Foreign | Fair Value of | Accumulated | ||||||||||||||
Currency | Cross-Currency | Other | |||||||||||||||
Translation | Swap | Comprehensive | |||||||||||||||
Adjustments | Income | ||||||||||||||||
Balance at December 31, 2012 | $ | 4,614 | $ | 131 | $ | 4,745 | |||||||||||
Unrealized gain on cross-currency swap, net of tax of $275 | — | 486 | 486 | ||||||||||||||
Foreign currency translation adjustment (1) | (273 | ) | — | (273 | ) | ||||||||||||
Balance at September 30, 2013 | $ | 4,341 | $ | 617 | $ | 4,958 | |||||||||||
-1 | As the cash generally remains permanently invested in the non-U.S. dollar denominated foreign subsidiaries, no deferred taxes are recognized on the related foreign currency translation adjustment. | ||||||||||||||||
Schedule of Comprehensive Income (Loss) | ' | ||||||||||||||||
Comprehensive income (loss) was comprised of the following components: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(US$ in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
(Restated) | (Restated) | ||||||||||||||||
Net income (loss) | $ | (19,822 | ) | $ | 5,016 | $ | (17,639 | ) | $ | 21,677 | |||||||
Other comprehensive income (loss): | |||||||||||||||||
Unrealized gain (loss) on cross-currency swap, net of tax of $275 | 582 | 253 | 486 | 177 | |||||||||||||
Foreign currency translation adjustment | 3,176 | 1,171 | (273 | ) | 215 | ||||||||||||
Total comprehensive income (loss) | $ | (16,064 | ) | $ | 6,440 | $ | (17,426 | ) | $ | 22,069 | |||||||
Earnings_per_share_Tables
Earnings per share (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Schedule of Reconciliation of Weighted Average Shares Used in Calculation of Basic and Diluted Earnings Per Share | ' | ||||||||||||||||
The following is a reconciliation of the weighted average shares used in the basic and diluted net income (loss) per common share computations. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Weighted average common shares-basic | 18,142,935 | 19,078,590 | 18,897,887 | 18,861,374 | |||||||||||||
Effect of dilutive securities: | |||||||||||||||||
Unexercised stock options net of treasury share repurchase | — | 454,431 | — | 438,889 | |||||||||||||
Weighted average common shares-diluted | 18,142,935 | 19,533,021 | 18,897,887 | 19,300,263 | |||||||||||||
Sharebased_compensation_Tables
Share-based compensation (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||||||||||
Schedule of Share-Based Compensation by Line Item in Condensed Consolidated Statements of Operations | ' | ||||||||||||||||
The following table shows the detail of share-based compensation by line item in the condensed consolidated statements of operations: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(US$ in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Cost of sales | $ | 27 | $ | 155 | $ | (249 | ) | $ | 438 | ||||||||
Sales and marketing | 469 | 598 | 1,375 | 1,440 | |||||||||||||
General and administrative | 726 | 1,309 | 3,431 | 2,851 | |||||||||||||
Research and development | 55 | 34 | 157 | 105 | |||||||||||||
Total | $ | 1,277 | $ | 2,096 | $ | 4,714 | $ | 4,834 | |||||||||
Business_segment_information_T
Business segment information (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Schedule of External Net Sales by SBU Reporting Segment | ' | ||||||||||||||||
The table below presents external net sales by SBU reporting segment (amounts reported for prior periods have been reclassified to conform to our new segment reporting structure). Net sales include product sales and marketing service fees. Marketing service fees, which are recorded on a net basis, are comprised of fees earned for the marketing of Trinity Evolution®, Trinity ELITE™ and Versashield® in our Biologics segment. | |||||||||||||||||
External Net Sales by SBU | |||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||
(US$ in thousands) | 2013 | 2012 | Reported | Constant | |||||||||||||
Growth | Currency | ||||||||||||||||
Growth | |||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||
BioStim | $ | 31,604 | $ | 42,310 | (25 | )% | (28 | )% | |||||||||
Biologics | 13,212 | 12,951 | 2 | % | 2 | % | |||||||||||
Spine Fixation | 23,221 | 25,001 | (7 | )% | (7 | )% | |||||||||||
Extremity Fixation | 24,701 | 27,595 | (10 | )% | (9 | )% | |||||||||||
Total Net Sales | $ | 92,738 | $ | 107,857 | (14 | )% | (15 | )% | |||||||||
External Net Sales by SBU | |||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||
(US$ in thousands) | 2013 | 2012 | Reported | Constant | |||||||||||||
Growth | Currency | ||||||||||||||||
Growth | |||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||
BioStim | $ | 108,445 | $ | 134,741 | (20 | )% | (20 | )% | |||||||||
Biologics | 39,827 | 39,792 | — | % | — | % | |||||||||||
Spine Fixation | 71,994 | 72,972 | (1 | )% | (1 | )% | |||||||||||
Extremity Fixation | 74,125 | 82,711 | (10 | )% | (8 | )% | |||||||||||
Total Net Sales | $ | 294,391 | $ | 330,216 | (11 | )% | (11 | )% | |||||||||
Schedule of Contribution Margin From Continuing Operations by SBU Reporting Segment | ' | ||||||||||||||||
The table below presents net margin, defined as gross profit less sales and marketing expenses, from continuing operations by SBU reporting segment: | |||||||||||||||||
Net margin by SBU | Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | ||||||||||||||||
(US$ in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
(Restated) | (Restated) | ||||||||||||||||
Net margin: | |||||||||||||||||
BioStim | $ | 10,614 | $ | 19,367 | $ | 45,911 | $ | 66,354 | |||||||||
Biologics | 6,743 | 5,664 | 18,472 | 16,524 | |||||||||||||
Spine Fixation | 1,227 | 4,693 | 7,489 | 13,379 | |||||||||||||
Extremity Fixation | 8,321 | 11,145 | 21,766 | 24,508 | |||||||||||||
Corporate | (469 | ) | (418 | ) | (1,376 | ) | (1,083 | ) | |||||||||
Total net margin | 26,436 | 40,451 | 92,262 | 119,682 | |||||||||||||
General and administrative | 13,202 | 13,850 | 46,736 | 42,715 | |||||||||||||
Research and development | 6,361 | 6,858 | 20,653 | 23,160 | |||||||||||||
Amortization of intangible assets | 616 | 565 | 1,725 | 1,725 | |||||||||||||
Costs related to the accounting review and restatement | 2,664 | 2,664 | |||||||||||||||
Impairment of goodwill | 19,193 | — | 19,193 | — | |||||||||||||
Charges related to U.S. Government resolutions | — | 373 | — | 1,059 | |||||||||||||
Operating income (loss) | $ | (15,600 | ) | $ | 18,805 | $ | 1,291 | $ | 51,023 | ||||||||
Sale_of_Breg_and_Disposition_o1
Sale of Breg and Disposition of Sports Medicine SBU (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Discontinued Operations And Disposal Groups [Abstract] | ' | ||||
Schedule of Information Related to Sale of Breg | ' | ||||
The following table presents the value of the asset disposition, proceeds received, net of various working capital adjustments and indebtedness and net gain on sale of Breg as shown in the condensed consolidated statement of operations for the year ended December 31, 2012. | |||||
(US$ in thousands) | Total | ||||
Cash proceeds | $ | 157,500 | |||
Less: | |||||
Working Capital | (7,093 | ) | |||
Transaction related expenses | (4,276 | ) | |||
Fair value of indemnification | (2,000 | ) | |||
Tangible assets | (8,309 | ) | |||
Intangible assets | (28,164 | ) | |||
Goodwill | (106,200 | ) | |||
Gain on sale of Breg, before taxes | 1,458 | ||||
Income tax expense | (113 | ) | |||
Gain on sale of Breg, net of taxes | $ | 1,345 | |||
Recovered_Sheet1
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 |
Goodwill [Line Items] | ' | ' | ' |
Impairment of goodwill | $19,193 | ' | $19,193 |
Spine Fixation and Extremity Fixation [Member] | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' |
Impairment of goodwill | $19,193 | ' | $19,193 |
Restatement_of_the_Condensed_C2
Restatement of the Condensed Consolidated Financial Statements - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 6 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | |
Inventory Reserves [Member] | Inventory Reserves [Member] | Distributor Revenue [Member] | Distributor Revenue [Member] | ||||
Distributors | Distributor | ||||||
Increase (Decrease) in net sales | $6,900,000 | ' | $20,100,000 | ' | ' | ' | ' |
Increase (Decrease) in net income | 2,500,000 | ' | 10,300,000 | ' | ' | ' | ' |
Number of distributer terminated | ' | ' | ' | ' | ' | ' | 2 |
Sales return | ' | ' | ' | ' | ' | ' | 3,300,000 |
Distributors that did not meet the fixed or determinable or collectability revenue recognition criteria | ' | ' | ' | ' | ' | 4 | ' |
Increase (Decrease) in accounts receivable | ' | -27,758,000 | 14,169,000 | ' | ' | ' | -41,300,000 |
Increase (Decease) in inventory | ' | 11,596,000 | -325,000 | ' | -14,800,000 | ' | 11,000,000 |
Increase (Decrease) in inventory reserve | ' | ' | ' | $1,200,000 | ' | ' | ' |
Restatement_of_the_Condensed_C3
Restatement of the Condensed Consolidated Financial Statements - Adjustments to Previously Filed Consolidated Statements of Operations (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Net sales | $92,738 | $107,857 | $294,391 | $330,216 |
Cost of sales | 23,920 | 24,384 | 69,783 | 73,309 |
Gross profit | 68,818 | 83,473 | 224,608 | 256,907 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | 42,382 | 43,022 | 132,346 | 137,225 |
General and administrative | 13,202 | 13,850 | 46,736 | 42,715 |
Research and development | 6,361 | 6,858 | 20,653 | 23,160 |
Amortization of intangible assets | 616 | 565 | 1,725 | 1,725 |
Charges related to U.S. Government resolutions | ' | 373 | ' | 1,059 |
Total operating expenses | 84,418 | 64,668 | 223,317 | 205,884 |
Operating income | -15,600 | 18,805 | 1,291 | 51,023 |
Other income and (expense) | -2,036 | -1,485 | 491 | -4,942 |
Income before income taxes | -17,636 | 17,320 | 1,782 | 46,081 |
Income tax (expense) | -448 | -6,746 | -8,126 | -17,040 |
Net income from continuing operations, net of tax | -18,084 | 10,574 | -6,344 | 29,041 |
Previously Reported [Member] | ' | ' | ' | ' |
Net sales | ' | 114,752 | ' | 350,286 |
Cost of sales | ' | 22,373 | ' | 67,989 |
Gross profit | ' | 92,379 | ' | 282,297 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | ' | 49,298 | ' | 148,629 |
General and administrative | ' | 13,850 | ' | 42,715 |
Research and development | ' | 6,858 | ' | 23,160 |
Amortization of intangible assets | ' | 515 | ' | 1,575 |
Charges related to U.S. Government resolutions | ' | 325 | ' | 1,689 |
Total operating expenses | ' | 70,846 | ' | 217,768 |
Operating income | ' | 21,533 | ' | 64,529 |
Other income and (expense) | ' | -1,485 | ' | -4,942 |
Income before income taxes | ' | 20,048 | ' | 59,587 |
Income tax (expense) | ' | -6,930 | ' | -20,286 |
Net income from continuing operations, net of tax | ' | 13,118 | ' | 39,301 |
Total Adjustments [Member] | ' | ' | ' | ' |
Net sales | ' | -6,895 | ' | -20,070 |
Cost of sales | ' | 2,011 | ' | 5,320 |
Gross profit | ' | -8,906 | ' | -25,390 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | ' | -6,276 | ' | -11,404 |
Amortization of intangible assets | ' | 50 | ' | 150 |
Charges related to U.S. Government resolutions | ' | 48 | ' | -630 |
Total operating expenses | ' | -6,178 | ' | -11,884 |
Operating income | ' | -2,728 | ' | -13,506 |
Income before income taxes | ' | -2,728 | ' | -13,506 |
Income tax (expense) | ' | 184 | ' | 3,246 |
Net income from continuing operations, net of tax | ' | -2,544 | ' | -10,260 |
Distributor Revenue [Member] | ' | ' | ' | ' |
Net sales | ' | -6,422 | ' | -19,678 |
Cost of sales | ' | -265 | ' | -3,837 |
Gross profit | ' | -6,157 | ' | -15,841 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | ' | -4,212 | ' | -5,156 |
Total operating expenses | ' | -4,212 | ' | -5,156 |
Operating income | ' | -1,945 | ' | -10,685 |
Income before income taxes | ' | -1,945 | ' | -10,685 |
Income tax (expense) | ' | 131 | ' | 2,340 |
Net income from continuing operations, net of tax | ' | -1,814 | ' | -8,345 |
Inventory Reserves [Member] | ' | ' | ' | ' |
Cost of sales | ' | 123 | ' | 2,791 |
Gross profit | ' | -123 | ' | -2,791 |
Operating expenses | ' | ' | ' | ' |
Operating income | ' | -123 | ' | -2,791 |
Income before income taxes | ' | -123 | ' | -2,791 |
Income tax (expense) | ' | 8 | ' | 1,111 |
Net income from continuing operations, net of tax | ' | -115 | ' | -1,680 |
Royalties [Member] | ' | ' | ' | ' |
Cost of sales | ' | 2,018 | ' | 6,223 |
Gross profit | ' | -2,018 | ' | -6,223 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | ' | -2,018 | ' | -6,223 |
Total operating expenses | ' | -2,018 | ' | -6,223 |
Other [Member] | ' | ' | ' | ' |
Net sales | ' | -473 | ' | -392 |
Cost of sales | ' | 135 | ' | 143 |
Gross profit | ' | -608 | ' | -535 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | ' | -46 | ' | -25 |
Amortization of intangible assets | ' | 50 | ' | 150 |
Charges related to U.S. Government resolutions | ' | 48 | ' | -630 |
Total operating expenses | ' | 52 | ' | -505 |
Operating income | ' | -660 | ' | -30 |
Income before income taxes | ' | -660 | ' | -30 |
Income tax (expense) | ' | 45 | ' | -205 |
Net income from continuing operations, net of tax | ' | ($615) | ' | ($235) |
Restatement_of_the_Condensed_C4
Restatement of the Condensed Consolidated Financial Statements - Effects of Restatements on Consolidated Balance Sheet (Detail) (USD $) | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | |||||
Current assets: | ' | ' | ' | ' | ' |
Cash and cash equivalents | $22,219 | ' | $31,055 | $53,572 | $33,207 |
Restricted cash | 22,732 | ' | 21,314 | ' | ' |
Trade accounts receivable, less allowances of $13,543 | 75,252 | ' | 107,312 | ' | ' |
Inventories | 100,204 | ' | 83,373 | ' | ' |
Deferred income taxes | 34,053 | ' | 33,450 | ' | ' |
Prepaid expenses and other current assets | 27,313 | ' | 34,079 | ' | ' |
Total current assets | 281,773 | ' | 310,583 | ' | ' |
Property, plant and equipment, net | 55,762 | ' | 53,835 | ' | ' |
Patents and other intangible assets, net | 9,821 | ' | 7,290 | ' | ' |
Goodwill | 55,405 | 72,758 | 74,388 | ' | 73,094 |
Deferred income taxes | 19,911 | ' | 18,881 | ' | ' |
Other long-term assets | 7,386 | ' | 7,920 | ' | ' |
Total assets | 430,058 | ' | 472,897 | ' | ' |
Current liabilities: | ' | ' | ' | ' | ' |
Trade accounts payable | 14,710 | ' | 22,575 | ' | ' |
Other current liabilities | 51,308 | ' | 39,610 | ' | ' |
Total current liabilities | 66,018 | ' | 62,185 | ' | ' |
Long-term debt | 20,000 | ' | 20,000 | ' | ' |
Deferred income taxes | 12,834 | ' | 11,456 | ' | ' |
Other long-term liabilities | 12,149 | ' | 11,424 | ' | ' |
Total liabilities | 111,001 | ' | 105,065 | ' | ' |
Contingencies (Note 16) | ' | ' | ' | ' | ' |
Shareholders' equity: | ' | ' | ' | ' | ' |
Common shares $0.10 par value; 50,000,000 shares authorized; 19,339,329 issued and outstanding | 1,810 | ' | 1,934 | ' | ' |
Additional paid-in capital | 215,081 | ' | 246,306 | ' | ' |
Retained earnings | 97,208 | ' | 114,847 | ' | ' |
Accumulated other comprehensive income | 4,958 | ' | 4,745 | ' | ' |
Total shareholders' equity | 319,057 | ' | 367,832 | ' | ' |
Total liabilities and shareholders' equity | 430,058 | ' | 472,897 | ' | ' |
Previously Reported [Member] | ' | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' | ' |
Cash and cash equivalents | ' | ' | 31,055 | ' | ' |
Restricted cash | ' | ' | 21,314 | ' | ' |
Trade accounts receivable, less allowances of $13,543 | ' | ' | 150,316 | ' | ' |
Inventories | ' | ' | 88,744 | ' | ' |
Deferred income taxes | ' | ' | 16,959 | ' | ' |
Prepaid expenses and other current assets | ' | ' | 32,056 | ' | ' |
Total current assets | ' | ' | 340,444 | ' | ' |
Property, plant and equipment, net | ' | ' | 51,362 | ' | ' |
Patents and other intangible assets, net | ' | ' | 6,880 | ' | ' |
Goodwill | ' | ' | 74,388 | ' | ' |
Deferred income taxes | ' | ' | 19,904 | ' | ' |
Other long-term assets | ' | ' | 11,303 | ' | ' |
Total assets | ' | ' | 504,281 | ' | ' |
Current liabilities: | ' | ' | ' | ' | ' |
Trade accounts payable | ' | ' | 21,812 | ' | ' |
Other current liabilities | ' | ' | 46,985 | ' | ' |
Total current liabilities | ' | ' | 68,797 | ' | ' |
Long-term debt | ' | ' | 20,000 | ' | ' |
Deferred income taxes | ' | ' | 11,456 | ' | ' |
Other long-term liabilities | ' | ' | 4,930 | ' | ' |
Total liabilities | ' | ' | 105,183 | ' | ' |
Contingencies (Note 16) | ' | ' | ' | ' | ' |
Shareholders' equity: | ' | ' | ' | ' | ' |
Common shares $0.10 par value; 50,000,000 shares authorized; 19,339,329 issued and outstanding | ' | ' | 1,934 | ' | ' |
Additional paid-in capital | ' | ' | 246,111 | ' | ' |
Retained earnings | ' | ' | 148,549 | ' | ' |
Accumulated other comprehensive income | ' | ' | 2,504 | ' | ' |
Total shareholders' equity | ' | ' | 399,098 | ' | ' |
Total liabilities and shareholders' equity | ' | ' | 504,281 | ' | ' |
Adjustments [Member] | ' | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' | ' |
Trade accounts receivable, less allowances of $13,543 | ' | ' | -43,004 | ' | ' |
Inventories | ' | ' | -5,371 | ' | ' |
Deferred income taxes | ' | ' | 16,491 | ' | ' |
Prepaid expenses and other current assets | ' | ' | 2,023 | ' | ' |
Total current assets | ' | ' | -29,861 | ' | ' |
Property, plant and equipment, net | ' | ' | 2,473 | ' | ' |
Patents and other intangible assets, net | ' | ' | 410 | ' | ' |
Deferred income taxes | ' | ' | -1,023 | ' | ' |
Other long-term assets | ' | ' | -3,383 | ' | ' |
Total assets | ' | ' | -31,384 | ' | ' |
Current liabilities: | ' | ' | ' | ' | ' |
Trade accounts payable | ' | ' | 763 | ' | ' |
Other current liabilities | ' | ' | -7,375 | ' | ' |
Total current liabilities | ' | ' | -6,612 | ' | ' |
Other long-term liabilities | ' | ' | 6,494 | ' | ' |
Total liabilities | ' | ' | -118 | ' | ' |
Contingencies (Note 16) | ' | ' | ' | ' | ' |
Shareholders' equity: | ' | ' | ' | ' | ' |
Additional paid-in capital | ' | ' | 195 | ' | ' |
Retained earnings | ' | ' | -33,702 | ' | ' |
Accumulated other comprehensive income | ' | ' | 2,241 | ' | ' |
Total shareholders' equity | ' | ' | -31,266 | ' | ' |
Total liabilities and shareholders' equity | ' | ' | ($31,384) | ' | ' |
Restatement_of_the_Condensed_C5
Restatement of the Condensed Consolidated Financial Statements - Effects of Restatements on Consolidated Balance Sheet (Parenthetical) (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' | ' |
Trade accounts receivable, allowance for doubtful accounts | $11,460 | $13,543 |
Common shares, par value | $0.10 | $0.10 |
Common shares, authorized | 50,000,000 | 50,000,000 |
Common shares, issued | 18,101,476 | 19,339,329 |
Common shares, outstanding | 18,101,476 | 19,339,329 |
Restatement_of_the_Condensed_C6
Restatement of the Condensed Consolidated Financial Statements - Effects of Restatement of Consolidated Statement of Operations and Comprehensive Income (Loss) (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Product sales | $81,061 | $96,552 | $259,030 | $296,062 |
Marketing service fees | 11,677 | 11,305 | 35,361 | 34,154 |
Net sales | 92,738 | 107,857 | 294,391 | 330,216 |
Cost of sales | 23,920 | 24,384 | 69,783 | 73,309 |
Gross profit | 68,818 | 83,473 | 224,608 | 256,907 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | 42,382 | 43,022 | 132,346 | 137,225 |
General and administrative | 13,202 | 13,850 | 46,736 | 42,715 |
Research and development | 6,361 | 6,858 | 20,653 | 23,160 |
Amortization of intangible assets | 616 | 565 | 1,725 | 1,725 |
Impairment of goodwill | 19,193 | ' | 19,193 | ' |
Charges related to U.S. Government resolutions | ' | 373 | ' | 1,059 |
Total operating expense | 84,418 | 64,668 | 223,317 | 205,884 |
Operating income | -15,600 | 18,805 | 1,291 | 51,023 |
Other income and expense | ' | ' | ' | ' |
Interest expense, net | -555 | -464 | -1,585 | -3,950 |
Other expense | -1,481 | -1,021 | 2,076 | -992 |
Total other income and expense | -2,036 | -1,485 | 491 | -4,942 |
Income before income taxes | -17,636 | 17,320 | 1,782 | 46,081 |
Income tax expense | -448 | -6,746 | -8,126 | -17,040 |
Net income from continuing operations, net of tax | -18,084 | 10,574 | -6,344 | 29,041 |
Discontinued operations (Note 15) | ' | ' | ' | ' |
Gain on sale of Breg, Inc., net of tax | ' | 221 | ' | 1,261 |
Loss from discontinued operations | -3,041 | -9,048 | -16,629 | -14,374 |
Income tax benefit | 1,303 | 3,269 | 5,334 | 5,749 |
Net loss from discontinued operations, net of tax | -1,738 | -5,558 | -11,295 | -7,364 |
Net income | -19,822 | 5,016 | -17,639 | 21,677 |
Net income (loss) per common share-basic: | ' | ' | ' | ' |
Net income from continuing operations, net of tax | ($1) | $0.55 | ($0.34) | $1.54 |
Net loss from discontinued operations, net of tax | ($0.10) | ($0.29) | ($0.60) | ($0.39) |
Net income (loss) per common share-basic | ($1.10) | $0.26 | ($0.94) | $1.15 |
Net income (loss) per common share-diluted: | ' | ' | ' | ' |
Net income from continuing operations, net of tax | ($1) | $0.54 | ($0.34) | $1.51 |
Net loss from discontinued operations, net of tax | ($0.10) | ($0.29) | ($0.60) | ($0.38) |
Net income per common share-diluted | ($1.10) | $0.25 | ($0.94) | $1.13 |
Weighted average number of common shares: | ' | ' | ' | ' |
Basic | 18,142,935 | 19,078,590 | 18,897,887 | 18,861,374 |
Diluted | 18,142,935 | 19,533,021 | 18,897,887 | 19,300,263 |
Comprehensive income | -16,064 | 6,440 | -17,426 | 22,069 |
Previously Reported [Member] | ' | ' | ' | ' |
Product sales | ' | 103,111 | ' | 315,837 |
Marketing service fees | ' | 11,641 | ' | 34,449 |
Net sales | ' | 114,752 | ' | 350,286 |
Cost of sales | ' | 22,373 | ' | 67,989 |
Gross profit | ' | 92,379 | ' | 282,297 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | ' | 49,298 | ' | 148,629 |
General and administrative | ' | 13,850 | ' | 42,715 |
Research and development | ' | 6,858 | ' | 23,160 |
Amortization of intangible assets | ' | 515 | ' | 1,575 |
Impairment of goodwill | ' | ' | ' | ' |
Charges related to U.S. Government resolutions | ' | 325 | ' | 1,689 |
Total operating expense | ' | 70,846 | ' | 217,768 |
Operating income | ' | 21,533 | ' | 64,529 |
Other income and expense | ' | ' | ' | ' |
Interest expense, net | ' | -464 | ' | -3,950 |
Other expense | ' | -1,021 | ' | -992 |
Total other income and expense | ' | -1,485 | ' | -4,942 |
Income before income taxes | ' | 20,048 | ' | 59,587 |
Income tax expense | ' | -6,930 | ' | -20,286 |
Net income from continuing operations, net of tax | ' | 13,118 | ' | 39,301 |
Discontinued operations (Note 15) | ' | ' | ' | ' |
Gain on sale of Breg, Inc., net of tax | ' | 221 | ' | 1,261 |
Loss from discontinued operations | ' | -9,046 | ' | -15,398 |
Income tax benefit | ' | 3,267 | ' | 5,617 |
Net loss from discontinued operations, net of tax | ' | -5,558 | ' | -8,520 |
Net income | ' | 7,560 | ' | 30,781 |
Net income (loss) per common share-basic: | ' | ' | ' | ' |
Net income from continuing operations, net of tax | ' | $0.69 | ' | $2.08 |
Net loss from discontinued operations, net of tax | ' | ($0.29) | ' | ($0.45) |
Net income (loss) per common share-basic | ' | $0.40 | ' | $1.63 |
Net income (loss) per common share-diluted: | ' | ' | ' | ' |
Net income from continuing operations, net of tax | ' | $0.67 | ' | $2.04 |
Net loss from discontinued operations, net of tax | ' | ($0.28) | ' | ($0.45) |
Net income per common share-diluted | ' | $0.39 | ' | $1.59 |
Weighted average number of common shares: | ' | ' | ' | ' |
Basic | ' | 19,078,590 | ' | 18,861,374 |
Diluted | ' | 19,533,021 | ' | 19,300,263 |
Comprehensive income | ' | 9,067 | ' | 30,615 |
Adjustments [Member] | ' | ' | ' | ' |
Product sales | ' | -6,559 | ' | -19,775 |
Marketing service fees | ' | -336 | ' | -295 |
Net sales | ' | -6,895 | ' | -20,070 |
Cost of sales | ' | 2,011 | ' | 5,320 |
Gross profit | ' | -8,906 | ' | -25,390 |
Operating expenses | ' | ' | ' | ' |
Sales and marketing | ' | -6,276 | ' | -11,404 |
Amortization of intangible assets | ' | 50 | ' | 150 |
Impairment of goodwill | ' | ' | ' | ' |
Charges related to U.S. Government resolutions | ' | 48 | ' | -630 |
Total operating expense | ' | -6,178 | ' | -11,884 |
Operating income | ' | -2,728 | ' | -13,506 |
Other income and expense | ' | ' | ' | ' |
Income before income taxes | ' | -2,728 | ' | -13,506 |
Income tax expense | ' | 184 | ' | 3,246 |
Net income from continuing operations, net of tax | ' | -2,544 | ' | -10,260 |
Discontinued operations (Note 15) | ' | ' | ' | ' |
Loss from discontinued operations | ' | -2 | ' | 1,024 |
Income tax benefit | ' | 2 | ' | 132 |
Net loss from discontinued operations, net of tax | ' | ' | ' | 1,156 |
Net income | ' | -2,544 | ' | -9,104 |
Net income (loss) per common share-basic: | ' | ' | ' | ' |
Net income from continuing operations, net of tax | ' | ($0.14) | ' | ($0.54) |
Net loss from discontinued operations, net of tax | ' | ' | ' | $0.06 |
Net income (loss) per common share-basic | ' | ($0.14) | ' | ($0.48) |
Net income (loss) per common share-diluted: | ' | ' | ' | ' |
Net income from continuing operations, net of tax | ' | ($0.13) | ' | ($0.53) |
Net loss from discontinued operations, net of tax | ' | ($0.01) | ' | $0.07 |
Net income per common share-diluted | ' | ($0.14) | ' | ($0.46) |
Weighted average number of common shares: | ' | ' | ' | ' |
Comprehensive income | ' | ($2,627) | ' | ($8,657) |
Inventories_Schedule_of_Invent
Inventories - Schedule of Inventories, Net of Reserves (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Raw materials | $6,038 | $7,623 |
Work-in-process | 8,230 | 7,886 |
Finished products | 40,682 | 28,308 |
Field inventory | 31,682 | 22,629 |
Consignment inventory | 4,589 | 6,155 |
Deferred cost of sales | 8,983 | 10,772 |
Total Inventory | $100,204 | $83,373 |
Patents_and_other_intangible_a2
Patents and other intangible assets - Schedule of Patents and Other Intangible Assets (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Finite And Indefinite Lived Intangible Assets [Line Items] | ' | ' |
Cost | $41,767 | $39,562 |
Accumulated amortization | -31,946 | -32,272 |
Patents and other intangible assets, net | 9,821 | 7,290 |
Patents [Member] | ' | ' |
Finite And Indefinite Lived Intangible Assets [Line Items] | ' | ' |
Cost | 41,135 | 38,905 |
Accumulated amortization | -31,487 | -31,845 |
Trademarks - definite lived [Member] | ' | ' |
Finite And Indefinite Lived Intangible Assets [Line Items] | ' | ' |
Cost | 632 | 657 |
Accumulated amortization | ($459) | ($427) |
Goodwill_Schedule_of_Changes_i
Goodwill - Schedule of Changes in Net Carrying Amount of Goodwill (Detail) (USD $) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 |
Goodwill [Line Items] | ' | ' | ' | ' | ' |
Beginning balance | $72,758 | ' | $74,388 | $74,388 | $73,094 |
Reallocation | ' | ' | ' | ' | ' |
Impairment | -19,193 | ' | ' | -19,193 | ' |
Foreign currency | 1,840 | ' | -1,630 | ' | 1,294 |
Ending balance | 55,405 | ' | 72,758 | 55,405 | 74,388 |
Spine [Member] | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' |
Beginning balance | 41,401 | ' | 41,564 | 41,564 | 41,419 |
Reallocation | -41,401 | ' | ' | ' | ' |
Impairment | ' | ' | ' | ' | ' |
Foreign currency | ' | ' | -163 | ' | 145 |
Ending balance | ' | ' | 41,401 | ' | 41,564 |
Orthopedics [Member] | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' |
Beginning balance | 31,357 | ' | 32,824 | 32,824 | 31,675 |
Reallocation | -31,357 | ' | ' | ' | ' |
Impairment | ' | ' | ' | ' | ' |
Foreign currency | ' | ' | -1,467 | ' | 1,149 |
Ending balance | ' | ' | 31,357 | ' | 32,824 |
BioStim [Member] | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' |
Beginning balance | ' | ' | ' | ' | ' |
Reallocation | 42,678 | ' | ' | ' | ' |
Impairment | ' | ' | ' | ' | ' |
Foreign currency | 1,472 | ' | ' | ' | ' |
Ending balance | 44,150 | ' | ' | 44,150 | ' |
Biologics [Member] | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' |
Beginning balance | ' | ' | ' | ' | ' |
Reallocation | 10,887 | ' | ' | ' | ' |
Impairment | ' | ' | ' | ' | ' |
Foreign currency | 368 | ' | ' | ' | ' |
Ending balance | 11,255 | ' | ' | 11,255 | ' |
Spine Fixation [Member] | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' |
Beginning balance | ' | ' | ' | ' | ' |
Reallocation | 9,368 | ' | ' | ' | ' |
Impairment | -9,368 | ' | ' | ' | ' |
Foreign currency | ' | ' | ' | ' | ' |
Ending balance | ' | ' | ' | ' | ' |
Extremity Fixation [Member] | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' |
Beginning balance | ' | ' | ' | ' | ' |
Reallocation | 9,825 | ' | ' | ' | ' |
Impairment | -9,825 | ' | ' | ' | ' |
Foreign currency | ' | ' | ' | ' | ' |
Ending balance | ' | ' | ' | ' | ' |
Goodwill_Additional_Informatio
Goodwill - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 |
Goodwill [Line Items] | ' | ' | ' |
Impairment of goodwill | $19,193 | ' | $19,193 |
Spine Fixation and Extremity Fixation [Member] | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' |
Impairment of goodwill | $19,193 | ' | $19,193 |
Bank_borrowings_Additional_Inf
Bank borrowings - Additional Information (Detail) | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2012 |
In Millions, unless otherwise specified | USD ($) | EUR (€) | USD ($) | EUR (€) |
Debt Disclosure [Abstract] | ' | ' | ' | ' |
Amount outstanding under lines of credit | $0 | ' | $0.10 | ' |
Weighted average interest rate on borrowings under lines of credit | ' | ' | 3.70% | 3.70% |
Maximum borrowing capacity | $7.80 | € 5.80 | $7.60 | € 5.80 |
Longterm_debt_Additional_Infor
Long-term debt - Additional Information (Detail) | 9 Months Ended | 1 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | 9 Months Ended | ||||||||||||||||
Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Aug. 30, 2010 | Sep. 30, 2012 | Jun. 30, 2012 | 31-May-12 | Sep. 30, 2013 | Dec. 31, 2012 | Aug. 30, 2010 | Sep. 30, 2013 | Dec. 31, 2012 | Aug. 30, 2010 | 31-May-12 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | |
USD ($) | USD ($) | EUR (€) | USD ($) | EUR (€) | USD ($) | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | LIBOR [Member] | LIBOR [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | New Credit Agreement [Member] | New Credit Agreement [Member] | Prior Credit Agreement [Member] | Prior Credit Agreement [Member] | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | USD ($) | USD ($) | USD ($) | USD ($) | Base rate [Member] | LIBOR [Member] | Base rate [Member] | LIBOR [Member] | LIBOR [Member] | |||||||
Maximum [Member] | Maximum [Member] | Maximum [Member] | |||||||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument term (in years) | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity | ' | $7,800,000 | € 5,800,000 | $7,600,000 | € 5,800,000 | ' | ' | ' | ' | ' | ' | $200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum additional borrowing capacity available | ' | ' | ' | ' | ' | 50,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repayment of debt obligation | 188,695,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 87,500,000 | ' | ' | ' | ' | ' | ' | ' |
Repayment of debt obligation | ' | ' | ' | ' | ' | ' | 20,000,000 | 20,000,000 | 57,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount outstanding | ' | 0 | ' | 100,000 | ' | ' | ' | ' | ' | 20,000,000 | 20,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Margin on variable rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.50% | 2.50% | ' | ' | ' | ' | ' | 3.25% | 2.25% | ' | ' |
Variable rate basis | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'LIBOR | ' | ' | ' | ' |
Effective interest rate (as a Percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.70% | 2.70% |
Revolving credit facility due date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30-Aug-15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of restricted net assets | ' | 200,500,000 | ' | 213,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restricted cash | ' | 22,732,000 | ' | 21,314,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt issuance costs incurred | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | ' | ' | ' | ' | ' |
Write-off of debt issue costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 800,000 | ' | ' | ' | ' | ' | ' | ' |
Deferred debt issuance costs, net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,300,000 | $1,800,000 | ' | ' | ' | ' | ' |
Derivative_instruments_Schedul
Derivative instruments - Schedule of Fair Values of Derivative Instruments (Detail) (Cross-currency swap [Member], USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | Other long-term liabilities [Member] | Other long-term assets [Member] |
Derivatives, Fair Value [Line Items] | ' | ' |
Fair value: favorable (unfavorable) | ($523) | $305 |
Derivative_instruments_Schedul1
Derivative instruments - Schedule of Gain (Loss) Recognized on Derivative Instruments (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Derivative Instruments [Line Items] | ' | ' | ' | ' |
Cross-currency swap unrealized gain (loss) recorded in other comprehensive income (loss), net of taxes | $582 | $253 | $486 | $177 |
Cross-currency swap [Member] | ' | ' | ' | ' |
Derivative Instruments [Line Items] | ' | ' | ' | ' |
Cross-currency swap unrealized gain (loss) recorded in other comprehensive income (loss), net of taxes | $582 | $253 | $486 | $177 |
Derivative_instruments_Additio
Derivative instruments - Additional Information (Detail) | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2010 | Sep. 30, 2010 |
Swap Agreement [Member] | Cross-currency swap [Member] | Cross-currency swap [Member] | |
Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | ||
Pay Euros [Member] | Receive U.S. dollars [Member] | ||
EUR (€) | USD ($) | ||
Derivatives, Fair Value [Line Items] | ' | ' | ' |
Notional amount | ' | € 28.70 | $39 |
Fixed rate (as a percent) | ' | 5.00% | 4.64% |
Swap agreement expiration date | 30-Dec-16 | ' | ' |
Fair_value_measurements_Additi
Fair value measurements - Additional Information (Detail) (Maximum [Member]) | 9 Months Ended |
Sep. 30, 2013 | |
Maximum [Member] | ' |
Financial Instruments And Fair Value Measurements [Line Items] | ' |
Cash Equivalents Original Maturity Period | '90 days |
Fair_value_measurements_Schedu
Fair value measurements - Schedule of Financial Assets and Liabilities Recorded at Fair Value on Recurring Basis (Detail) (Fair Value, Measurements, Recurring [Member], USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cross currency swap asset (liability) | ($523) | $305 |
Fair Value, Inputs, Level 1 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cross currency swap asset (liability) | ' | ' |
Fair Value, Inputs, Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cross currency swap asset (liability) | -523 | 305 |
Fair Value, Inputs, Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cross currency swap asset (liability) | ' | ' |
Comprehensive_income_loss_Sche
Comprehensive income (loss) - Schedule of Components of Changes in Accumulated Other Comprehensive Income (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' |
Beginning balance | ' | ' | $4,745 | ' |
Unrealized gain on cross-currency swap, net of tax $275 | 582 | 253 | 486 | 177 |
Foreign currency translation adjustment | 3,176 | 1,171 | -273 | 215 |
Ending balance | 4,958 | ' | 4,958 | ' |
Foreign Currency Translation Adjustments [Member] | ' | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' |
Beginning balance | ' | ' | 4,614 | ' |
Foreign currency translation adjustment | ' | ' | -273 | ' |
Ending balance | 4,341 | ' | 4,341 | ' |
Fair Value of Cross- Currency Swaps [Member] | ' | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' |
Beginning balance | ' | ' | 131 | ' |
Unrealized gain on cross-currency swap, net of tax $275 | ' | ' | 486 | ' |
Ending balance | 617 | ' | 617 | ' |
Accumulated Other Comprehensive Income (Loss) [Member] | ' | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' |
Beginning balance | ' | ' | 4,745 | ' |
Unrealized gain on cross-currency swap, net of tax $275 | ' | ' | 486 | ' |
Foreign currency translation adjustment | ' | ' | -273 | ' |
Ending balance | $4,958 | ' | $4,958 | ' |
Comprehensive_income_loss_Sche1
Comprehensive income (loss) - Schedule of Components of Changes in Accumulated Other Comprehensive Income (Parenthetical) (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' |
Unrealized gain on derivative instrument, taxes | $275 | $275 | $275 | $275 |
Deferred taxes recognized on related foreign currency translation adjustment | ' | ' | 0 | ' |
Fair Value of Cross- Currency Swaps [Member] | ' | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' |
Unrealized gain on derivative instrument, taxes | ' | ' | 275 | ' |
Accumulated Other Comprehensive Income (Loss) [Member] | ' | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' |
Unrealized gain on derivative instrument, taxes | ' | ' | $275 | ' |
Comprehensive_income_loss_Sche2
Comprehensive income (loss) - Schedule of Comprehensive Income (Loss) (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Statement Of Stockholders Equity [Abstract] | ' | ' | ' | ' |
Net income (loss) | ($19,822) | $5,016 | ($17,639) | $21,677 |
Other comprehensive income (loss): | ' | ' | ' | ' |
Unrealized gain (loss) on cross-currency swap, net of tax of $275 | 582 | 253 | 486 | 177 |
Foreign currency translation adjustment | 3,176 | 1,171 | -273 | 215 |
Total comprehensive income (loss) | ($16,064) | $6,440 | ($17,426) | $22,069 |
Comprehensive_income_loss_Sche3
Comprehensive income (loss) - Schedule of Comprehensive Income (Loss) (Parenthetical) (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Statement Of Stockholders Equity [Abstract] | ' | ' | ' | ' |
Unrealized gain on derivative instrument, taxes | $275 | $275 | $275 | $275 |
Earnings_per_share_Additional_
Earnings per share - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Weighted average number diluted shares outstanding adjustment | 176,482 | ' | ' | ' |
Options to purchase common stock [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Outstanding options not included in diluted earnings per share | 1,647,878 | 636,900 | 1,186,259 | 688,636 |
Earnings_per_share_Schedule_of
Earnings per share - Schedule of Reconciliation of Weighted Average Shares Used in Calculation of Basic and Diluted Earnings Per Share (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Earnings Per Share [Abstract] | ' | ' | ' | ' |
Weighted average common shares-basic | 18,142,935 | 19,078,590 | 18,897,887 | 18,861,374 |
Effect of dilutive securities: | ' | ' | ' | ' |
Unexercised stock options net of treasury share repurchase | ' | 454,431 | ' | 438,889 |
Weighted average common shares-diluted | 18,142,935 | 19,533,021 | 18,897,887 | 19,300,263 |
Sharebased_compensation_Schedu
Share-based compensation - Schedule of Share-Based Compensation by Line Item in Consolidated Statements of Operations (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Allocated share based compensation expense | $1,277 | $2,096 | $4,714 | $4,834 |
Cost of sales [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Allocated share based compensation expense | 27 | 155 | -249 | 438 |
Sales and marketing [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Allocated share based compensation expense | 469 | 598 | 1,375 | 1,440 |
General and administrative [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Allocated share based compensation expense | 726 | 1,309 | 3,431 | 2,851 |
Research and development [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Allocated share based compensation expense | $55 | $34 | $157 | $105 |
Sharebased_compensation_Additi
Share-based compensation - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ' | ' | ' |
Common stock issued under Employee Stock Purchase Plan (in shares) | 56,281 | 332,985 | 199,725 | 814,022 |
Income_taxes_Additional_Inform
Income taxes - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Mar. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Tax [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Provision for income tax | $448,000 | $6,746,000 | $8,126,000 | $17,040,000 | ' | ' | ' |
Income tax effective rate (as a percent) | ' | ' | 456.00% | 37.50% | ' | ' | ' |
Income related to legal settlement | ' | ' | ' | 600,000 | ' | ' | ' |
Impairment of goodwill | 19,193,000 | ' | 19,193,000 | ' | ' | ' | ' |
Income tax effective rate excluding the impact of the charges related to the U.S. Government resolutions (as a percent) | ' | ' | ' | 38.80% | ' | ' | ' |
Gross unrecognized tax benefit | 700,000 | ' | 700,000 | ' | ' | 1,200,000 | ' |
Accrued interest and penalties related to unrecognized tax benefits | ' | ' | ' | ' | 900,000 | 900,000 | ' |
Recognition of uncertain tax benefits | ' | ' | 'Accounting guidance only allows the recognition of those tax benefits that have a greater than 50% likelihood of being sustained upon examination by the taxing authorities. | ' | ' | ' | ' |
Unremitted foreign earnings | ' | ' | ' | ' | ' | 292,000,000 | 285,300,000 |
U.S. Subsidiary [Member] | ' | ' | ' | ' | ' | ' | ' |
Income Tax [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Unremitted foreign earnings | ' | ' | ' | ' | ' | $293,800,000 | ' |
Business_segment_information_A
Business segment information - Additional Information (Detail) | 3 Months Ended |
Sep. 30, 2013 | |
Segment | |
Segment Reporting [Abstract] | ' |
Number of strategic business units | 4 |
Business_segment_information_S
Business segment information - Schedule of External Net Sales by SBU Reporting Segment (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Reported Growth (as a percent) | -14.00% | ' | -11.00% | ' |
Constant Currency Growth (as a percent) | -15.00% | ' | -11.00% | ' |
Total Net Sales | $92,738 | $107,857 | $294,391 | $330,216 |
BioStim [Member] | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Reported Growth (as a percent) | -25.00% | ' | -20.00% | ' |
Constant Currency Growth (as a percent) | -28.00% | ' | -20.00% | ' |
Total Net Sales | 31,604 | 42,310 | 108,445 | 134,741 |
Biologics [Member] | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Reported Growth (as a percent) | 2.00% | ' | ' | ' |
Constant Currency Growth (as a percent) | 2.00% | ' | ' | ' |
Total Net Sales | 13,212 | 12,951 | 39,827 | 39,792 |
Spine Fixation [Member] | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Reported Growth (as a percent) | -7.00% | ' | -1.00% | ' |
Constant Currency Growth (as a percent) | -7.00% | ' | -1.00% | ' |
Total Net Sales | 23,221 | 25,001 | 71,994 | 72,972 |
Extremity Fixation [Member] | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Reported Growth (as a percent) | -10.00% | ' | -10.00% | ' |
Constant Currency Growth (as a percent) | -9.00% | ' | -8.00% | ' |
Total Net Sales | $24,701 | $27,595 | $74,125 | $82,711 |
Business_segment_information_S1
Business segment information - Schedule of Contribution Margin From Continuing Operations by SBU Reporting Segment (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Sales Information [Line Items] | ' | ' | ' | ' |
Total net margin | $26,436 | $40,451 | $92,262 | $119,682 |
General and administrative | 13,202 | 13,850 | 46,736 | 42,715 |
Research and development | 6,361 | 6,858 | 20,653 | 23,160 |
Amortization of intangible assets | 616 | 565 | 1,725 | 1,725 |
Costs related to the accounting review and restatement | 2,664 | ' | 2,664 | ' |
Impairment of goodwill | 19,193 | ' | 19,193 | ' |
Charges related to U.S. Government resolutions | ' | 373 | ' | 1,059 |
Operating income (loss) | -15,600 | 18,805 | 1,291 | 51,023 |
BioStim [Member] | ' | ' | ' | ' |
Sales Information [Line Items] | ' | ' | ' | ' |
Total net margin | 10,614 | 19,367 | 45,911 | 66,354 |
Impairment of goodwill | ' | ' | ' | ' |
Biologics [Member] | ' | ' | ' | ' |
Sales Information [Line Items] | ' | ' | ' | ' |
Total net margin | 6,743 | 5,664 | 18,472 | 16,524 |
Impairment of goodwill | ' | ' | ' | ' |
Spine Fixation [Member] | ' | ' | ' | ' |
Sales Information [Line Items] | ' | ' | ' | ' |
Total net margin | 1,227 | 4,693 | 7,489 | 13,379 |
Impairment of goodwill | 9,368 | ' | ' | ' |
Extremity Fixation [Member] | ' | ' | ' | ' |
Sales Information [Line Items] | ' | ' | ' | ' |
Total net margin | 8,321 | 11,145 | 21,766 | 24,508 |
Impairment of goodwill | 9,825 | ' | ' | ' |
Corporate [Member] | ' | ' | ' | ' |
Sales Information [Line Items] | ' | ' | ' | ' |
Total net margin | ($469) | ($418) | ($1,376) | ($1,083) |
Sale_of_Breg_and_Disposition_o2
Sale of Breg and Disposition of Sports Medicine SBU - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 0 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | 24-May-12 | Sep. 30, 2013 | Dec. 31, 2012 | |
Breg Orthofix Holdings, Inc [Member] | Orthofix Inc [Member] | Orthofix Inc [Member] | Orthofix Inc [Member] | |||
Breg Orthofix Holdings, Inc [Member] | Breg Orthofix Holdings, Inc [Member] | Breg Orthofix Holdings, Inc [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' | ' |
Proceeds from sale of outstanding shares of Breg | ' | ' | ' | $157,500,000 | ' | ' |
Prepayment of outstanding company indebtedness | ' | ' | ' | 145,000,000 | ' | ' |
Fair value of liability | ' | ' | ' | 2,000,000 | ' | ' |
Period of indemnification (in years) | ' | ' | ' | ' | '3 years | ' |
Obligations under guarantee | ' | ' | 2,000,000 | ' | 1,100,000 | 1,600,000 |
Indemnification Expense | $3,100,000 | $15,800,000 | ' | ' | ' | ' |
Sale_of_Breg_and_Disposition_o3
Sale of Breg and Disposition of Sports Medicine SBU - Schedule of Information Related to Sale of Breg (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2012 | Sep. 30, 2012 | Dec. 31, 2012 |
Breg Orthofix Holdings, Inc [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' |
Cash proceeds | ' | ' | $157,500 |
Less: | ' | ' | ' |
Working Capital | ' | ' | -7,093 |
Transaction related expenses | ' | ' | -4,276 |
Fair value of indemnification | ' | ' | -2,000 |
Tangible assets | ' | ' | -8,309 |
Intangible assets | ' | ' | -28,164 |
Goodwill | ' | ' | -106,200 |
Gain on sale of Breg, before taxes | ' | ' | 1,458 |
Income tax expense | ' | ' | -113 |
Gain on sale of Breg, net of taxes | $221 | $1,261 | $1,345 |
Stock_Repurchase_Program_Addit
Stock Repurchase Program - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended |
In Millions, unless otherwise specified | 8-May-13 | Sep. 30, 2013 | Sep. 30, 2013 |
Equity [Abstract] | ' | ' | ' |
Share repurchase program, authorized amount | $50 | ' | ' |
Stock repurchased amount | ' | $12.60 | $39.50 |