DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 25, 2019 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | iart | |
Entity Registrant Name | INTEGRA LIFESCIENCES HOLDINGS CORP | |
Entity Central Index Key | 0000917520 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Smaller Reporting Company | false | |
Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 85,476,801 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | ||
Total revenue, net | $ 359,690 | $ 357,082 |
Costs and expenses: | ||
Cost of goods sold | 128,912 | 144,222 |
Research and development | 18,321 | 18,325 |
Selling, general and administrative | 174,870 | 163,566 |
Intangible asset amortization | 5,279 | 5,390 |
Total costs and expenses | 327,382 | 331,503 |
Operating income | 32,308 | 25,579 |
Interest income | 2,428 | 76 |
Interest expense | (13,149) | (18,768) |
Other income, net | 3,236 | 2,245 |
Income before income taxes | 24,823 | 9,132 |
Income tax benefit | (7,933) | (1,860) |
Net income | $ 32,756 | $ 10,992 |
Net income per share | ||
Basic (in dollars per share) | $ 0.38 | $ 0.14 |
Diluted (in dollars per share) | $ 0.38 | $ 0.14 |
Weighted average common shares outstanding (See Note 13): | ||
Basic (in shares) | 85,343 | 78,552 |
Diluted (in shares) | 86,258 | 79,834 |
Comprehensive income (See Note 14) | $ 21,520 | $ 32,604 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 157,025 | $ 138,838 |
Trade accounts receivable, net of allowances of $4,099 and $3,719 | 279,072 | 265,737 |
Inventories, net | 286,962 | 280,347 |
Prepaid expenses and other current assets | 99,627 | 90,160 |
Total current assets | 822,686 | 775,082 |
Property, plant and equipment, net | 306,350 | 300,112 |
Intangible assets, net | 1,058,630 | 1,079,496 |
Goodwill | 922,508 | 926,475 |
Deferred tax assets, net | 16,404 | 6,805 |
Other assets | 79,133 | 19,917 |
Total assets | 3,205,711 | 3,107,887 |
Current liabilities: | ||
Short-term portion of borrowings under senior credit facility | 33,750 | 22,500 |
Accounts payable, trade | 100,553 | 76,050 |
Deferred revenue | 3,750 | 3,764 |
Accrued compensation | 57,561 | 75,693 |
Accrued expenses and other current liabilities | 92,492 | 84,545 |
Total current liabilities | 288,106 | 262,552 |
Long-term borrowings under senior credit facility | 1,205,025 | 1,210,513 |
Long-term borrowings under securitization facility | 126,000 | 121,200 |
Deferred tax liabilities | 57,660 | 57,778 |
Other liabilities | 131,890 | 80,048 |
Total liabilities | 1,808,681 | 1,732,091 |
Commitments and contingencies (Refer to Note 16) | ||
Stockholders’ equity: | ||
Preferred stock; no par value; 15,000 authorized shares; none outstanding | 0 | 0 |
Common stock; $0.01 par value; 240,000 authorized shares; 88,304 and 88,044 issued at March 31, 2019 and December 31, 2018, respectively | 882 | 880 |
Additional paid-in capital | 1,191,807 | 1,192,601 |
Treasury stock, at cost; 2,869 shares and 2,881 shares at March 31, 2019 and December 31, 2018, respectively | (120,109) | (120,615) |
Accumulated other comprehensive loss | (56,679) | (45,443) |
Retained earnings | 381,129 | 348,373 |
Total stockholders’ equity | 1,397,030 | 1,375,796 |
Total liabilities and stockholders’ equity | $ 3,205,711 | $ 3,107,887 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Trade accounts receivable, allowance | $ 4,099 | $ 3,719 |
Preferred stock, authorized shares (in shares) | 15,000,000 | 15,000,000 |
Preferred stock, outstanding shares (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares (in shares) | 240,000,000 | 240,000,000 |
Common stock, issued shares (in shares) | 88,304,000 | 88,044,000 |
Treasury stock, shares (in shares) | 2,869,000 | 2,881,000 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
OPERATING ACTIVITIES: | ||
Net income | $ 32,756 | $ 10,992 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 27,093 | 27,096 |
Deferred income tax | (6,843) | (1,636) |
Amortization of debt issuance costs | 1,357 | 1,519 |
Loss on disposal of property and equipment | 367 | 146 |
Change in fair value of contingent consideration and other | 194 | 379 |
Share-based compensation | 4,083 | 4,731 |
Changes in assets and liabilities, net of business acquisitions: | ||
Accounts receivable | (13,705) | (18,400) |
Inventories | (12,048) | 1,297 |
Prepaid expenses and other current assets | (12,949) | 12,163 |
Other non-current assets | (628) | 339 |
Accounts payable, accrued expenses and other current liabilities | 5,387 | 2,974 |
Deferred revenue | (188) | 0 |
Other non-current liabilities | 4,608 | (69) |
Net cash provided by operating activities | 29,484 | 41,531 |
INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (16,086) | (15,387) |
Proceeds from note receivable | 245 | 221 |
Proceeds from sale of property and equipment | 35 | 148 |
Cash provided by business acquisitions | 0 | 5,720 |
Net cash used in investing activities | (15,806) | (9,298) |
FINANCING ACTIVITIES: | ||
Proceeds from borrowings of long-term indebtedness | 67,200 | 25,000 |
Payments on debt | (57,400) | (35,000) |
Net cash paid for contingent consideration | 0 | (7,772) |
Proceeds from exercised stock options | 1,750 | 3,662 |
Cash taxes paid in net equity settlement | (6,157) | (6,776) |
Net cash provided by (used in) financing activities | 5,393 | (20,886) |
Effect of exchange rate changes on cash and cash equivalents | (884) | 3,114 |
Net increase in cash and cash equivalents | 18,187 | 14,461 |
Cash and cash equivalents at beginning of period | 138,838 | 174,935 |
Cash and cash equivalents at end of period | $ 157,025 | $ 189,396 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY - USD ($) $ in Thousands | Total | Common Stock | Treasury Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings |
Balance Beginning of Period, Shares (in shares) at Dec. 31, 2017 | 81,306,000 | |||||
Balance, Beginning of Period at Dec. 31, 2017 | $ 962,306 | $ 813 | $ (121,644) | $ 821,758 | $ (23,807) | $ 285,186 |
Balance, Beginning of Period, Treasury Stock, Shares (in shares) at Dec. 31, 2017 | (2,927,000) | |||||
Net income | 10,992 | 10,992 | ||||
Other comprehensive income (loss), net of tax | 21,612 | 22,144 | (532) | |||
Issuance of common stock (in shares) | 297,000 | |||||
Issuance of common stock | 3,110 | $ 3 | 3,107 | |||
Issuance of common stock through employee stock purchase plan | 553 | 553 | ||||
Issuance of common stock for vesting of share based awards, net of shares withheld for taxes (in shares) | 108,000 | 37,000 | ||||
Issuance of common stock for vesting of share based awards, net of shares withheld for taxes | (6,732) | $ 1 | $ 910 | (7,643) | ||
Share-based compensation | 4,745 | 4,745 | ||||
Balance End of Period, Shares (in shares) at Mar. 31, 2018 | 81,711,000 | |||||
Balance, End of Period at Mar. 31, 2018 | 998,440 | $ 817 | $ (120,734) | 822,520 | (1,663) | 297,500 |
Balance, End of Period, Treasury Stock, Shares (in shares) at Mar. 31, 2018 | (2,890,000) | |||||
Balance Beginning of Period, Shares (in shares) at Dec. 31, 2018 | 88,044,000 | |||||
Balance, Beginning of Period at Dec. 31, 2018 | $ 1,375,796 | $ 880 | $ (120,615) | 1,192,601 | (45,443) | 348,373 |
Balance, Beginning of Period, Treasury Stock, Shares (in shares) at Dec. 31, 2018 | (2,881,000) | (2,881,000) | ||||
Net income | $ 32,756 | 32,756 | ||||
Other comprehensive income (loss), net of tax | (11,236) | (11,236) | ||||
Issuance of common stock through employee stock purchase plan (in shares) | 17,000 | |||||
Issuance of common stock through employee stock purchase plan | 716 | 716 | ||||
Issuance of common stock for vesting of share based awards, net of shares withheld for taxes (in shares) | 243,000 | 12,000 | ||||
Issuance of common stock for vesting of share based awards, net of shares withheld for taxes | (5,121) | $ 2 | $ 506 | (5,629) | ||
Share-based compensation | 4,119 | 4,119 | ||||
Balance End of Period, Shares (in shares) at Mar. 31, 2019 | 88,304,000 | |||||
Balance, End of Period at Mar. 31, 2019 | $ 1,397,030 | $ 882 | $ (120,109) | $ 1,191,807 | $ (56,679) | $ 381,129 |
Balance, End of Period, Treasury Stock, Shares (in shares) at Mar. 31, 2019 | (2,869,000) | (2,869,000) |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION General The terms “we,” “our,” “us,” “Company” and “Integra” refer to Integra LifeSciences Holdings Corporation, a Delaware corporation, and its subsidiaries unless the context suggests otherwise. In the opinion of management, the March 31, 2019 unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary for a fair statement of the financial position, results of operations and cash flows of the Company. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements for the year ended December 31, 2018 included in the Company’s Annual Report on Form 10-K. The December 31, 2018 consolidated balance sheet was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. Operating results for the three month period ended March 31, 2019 are not necessarily indicative of the results to be expected for the entire year. The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent liabilities, and the reported amounts of revenues and expenses. Significant estimates affecting amounts reported or disclosed in the consolidated financial statements include allowances for doubtful accounts receivable and sales returns and allowances, net realizable value of inventories, valuation of intangible assets including amortization periods for acquired intangible assets, discount rates and estimated projected cash flows used to value and test impairments of long-lived assets and goodwill, estimates of projected cash flows and depreciation and amortization periods for long-lived assets, computation of taxes, valuation allowances recorded against deferred tax assets, the valuation of stock-based compensation, valuation of derivative instruments, valuation of pension assets and liabilities, valuation of contingent liabilities, the fair value of debt instruments and loss contingencies. These estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the current circumstances. Actual results could differ from these estimates. Recently Issued Accounting Standards In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (the New Lease Standard) . The New Lease Standard requires that lessees recognize virtually all of its leases on the balance sheet by recording a right-of-use asset and lease liability (other than leases that meet the definition of a "short-term lease"). This update became effective for all annual periods and interim reporting periods beginning after December 15, 2018. The Company adopted the New Lease Standard as of January 1, 2019 using a modified retrospective transition. Under this method, financial results reported in periods prior to January 1, 2019 are unchanged. The Company also elected the package of practical expedients, which among other things, does not require reassessment of lease classification. As most of our leases do not provide an implicit rate, we used our collateralized incremental borrowing rate based on the information available at the lease implementation date in determining the present value of the lease payments. The adoption of the New Lease Standard had an impact on our consolidated balance sheet due to the recognition of $76.4 million of lease liabilities with corresponding right-of-use assets ("ROU") of $67.3 million for operating leases. The difference between lease liabilities and right-of-use assets is primarily attributed to unamortized lease incentives which will be amortized over the term of each respective lease. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) : Measurement of Credit Losses on Financial Instruments. The ASU is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The ASU requires the measurement of all expected credit losses for financial assets including trade receivables held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Company is evaluating the impact, if any, that this pronouncement will have on our financial position and results of operations. In August 2018, the FASB issued ASU 2018-14, Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20): Disclosure Framework-Changes to the Disclosure Requirements for Defined Benefit Plans. The new guidance modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans, including removing certain previous disclosure requirements, adding certain new disclosure requirements, and clarifying certain other disclosure requirements. The ASU will be effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Early adoption is permitted. The adoption is not expected to have a material impact on the Condensed and Consolidated Financial Statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40) , relating to a customer's accounting for implementation, set-up, and other upfront costs incurred in a cloud computing arrangement that is hosted by a vendor (i.e., a service contract). Under the new guidance, a customer will apply the same criteria for capitalizing implementation costs as it would for an arrangement that has a software license. The new guidance also prescribes the balance sheet, income statement, and cash flow classification of the capitalized implementation costs and related amortization expense, and requires additional quantitative and qualitative disclosures. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application is permitted. The Company can choose to adopt the new guidance (1) prospectively to eligible costs incurred on or after the date this guidance is first applied or (2) retrospectively. The Company is evaluating the impact, if any, that this pronouncement will have on our financial position and results of operations. There are no other recently issued accounting pronouncements that are expected to have any significant effect on the Company's financial position, results of operations or cash flows. |
BUSINESS DEVELOPMENT
BUSINESS DEVELOPMENT | 3 Months Ended |
Mar. 31, 2019 | |
Asset Acquisition [Abstract] | |
BUSINESS DEVELOPMENT | BUSINESS DEVELOPMENT Integrated Shoulder Collaboration, Inc. On January 4, 2019, the Company entered into a licensing agreement with Integrated Shoulder Collaboration, Inc ("ISC"). Under the terms of the agreement, the Company paid ISC $1.7 million for the exclusive, worldwide license to commercialize its short stem and stemless shoulder system. A patent related to short stem and stemless shoulder systems was issued to ISC during the first quarter of 2019. ISC is eligible to receive royalties on sales of the short stem and stemless shoulder system. The Company has the option to acquire ISC at a date four years subsequent to the first commercial sale, which becomes mandatory upon the achievement of a certain sales threshold of the short stem and stemless shoulder system, for an amount not to exceed $80.0 million . The transaction was accounted for as an asset acquisition as the Company concluded that it acquired primarily one asset. The total upfront payment of $1.7 million was expensed as a component of research and development expense and the future milestone and option payments will be recorded if the corresponding events become probable. |
REVENUES FROM CONTRACTS WITH CU
REVENUES FROM CONTRACTS WITH CUSTOMERS | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
REVENUES FROM CONTRACTS WITH CUSTOMERS | REVENUES FROM CONTRACTS WITH CUSTOMERS Summary of Accounting Policies on Revenue Recognition Revenue is recognized upon the transfer of control of promised products or services to the customers in an amount that reflects the consideration the Company expects to receive in exchange for those products and services. Total revenue, net, includes product sales, product royalties and other revenues, such as fees received for services. For products shipped with FOB shipping point terms, the control of the product passes to the customer at the time of shipment. For shipments in which the control of the product is transferred when the customer receives the product, the Company recognizes revenue upon receipt by the customer. Certain products that the Company produces for private label customers have no alternative use and the Company has a right of payment for performance to date. Revenues from those products are recognized over the period that the Company manufactures these products, which is typically one to three months. The Company uses the input method to measure the manufacturing activities completed to date, which depicts the progress of the Company's performance obligation of transferring control of goods being manufactured for private label customers. A portion of the Company's product revenue is generated from consigned inventory maintained at hospitals and distributors, and also from inventory physically held by field sales representatives. For these types of products sales, the Company retains control until the product has been used or implanted, at which time revenue is recognized. Revenues from sale of products and services are evidenced by either a contract with the customer or a valid purchase order and an invoice which includes all relevant terms of sale. For product sales, invoices are generally issued upon the transfer of control (or upon the completion of the manufacturing in the case of the private label transactions recognized over time) and are typically payable thirty days after the invoice date. The Company performs a review of each specific customer's creditworthiness and ability to pay prior to acceptance as a customer. Further, the Company performs periodic reviews of its customers' creditworthiness prospectively. Performance Obligations The Company's performance obligations consist mainly of transferring control of goods and services identified in the contracts, purchase orders, or invoices. The Company has no significant multi-element contracts with customers. Significant Judgments Usage-based royalties and licenses are estimated based on the provisions of contracts with customers and recognized in the same period that the royalty-based products are sold by the Company's strategic partners. The Company estimates and recognizes royalty revenue based upon communication with licensees, historical information, and expected sales trends. Differences between actual reported licensee sales and those that were estimated are adjusted in the period in which they become known, which is typically the following quarter. Historically, such adjustments have not been significant. The Company estimates returns, price concessions, and discount allowances using the expected value method based on historical trends and other known factors. Rebate allowances are estimated using the most likely method based on each customer contract. The Company's return policy, as set forth in its product catalogs and sales invoices, requires the Company to review and authorize the return of a product in advance. Upon the authorization, a credit will be issued for the goods returned within a set amount of days from the shipment, which is generally ninety days. The Company disregards the effects of a financing component if the Company expects, at contract inception, that the period between the transfer and customer payment for the good or services will be one year or less. The Company has no significant revenues recognized on payments expected to be received more than one year after the transfer of control of products or services to customers. Contract Asset and Liability Revenues recognized from the Company's private label business that are not invoiced to the customers as a result of recognizing revenue over time are recorded as a contract asset included in the prepaid expenses and other current assets account in the consolidated balance sheet. Other operating revenues may include fees received under service agreements. Non-refundable fees received under multiple-period service agreements are recognized as revenue as the Company satisfies the performance obligations to the other party. A portion of the transaction price allocated to the performance obligations to be satisfied in the future periods is recognized as contract liability. The following table summarizes the changes in the contract asset and liability balances for the three months ended March 31, 2019 : Contract Asset Contract asset, January 1, 2019 $ 4,193 Transferred to trade receivable of contract asset included in beginning of the year contract asset (4,193 ) Contract asset, net of transferred to trade receivables on contracts during the period 5,848 Contract asset, March 31, 2019 $ 5,848 Contract Liability Contract liability, January 1, 2019 $ 12,716 Recognition of revenue included in beginning of year contract liability (1,165 ) Contract liability, net of revenue recognized on contracts during the period 800 Foreign currency translation 4 Contract liability, March 31, 2019 $ 12,355 At March 31, 2019 , the short-term portion of the contract liability of $3.8 million and the long-term portion of $8.6 million were included in accrued expenses and other current liabilities and other liabilities in the consolidated balance sheet. As of March 31, 2019 , the Company is expected to recognize revenue of approximately $3.0 million for the remainder of 2019, $2.9 million in 2020, $2.2 million in 2021, $1.3 million in 2022, $0.8 million in 2023, and $2.2 million thereafter. Shipping and Handling Fees The Company elected to account for shipping and handling activities as a fulfillment cost rather than a separate performance obligation. Amounts billed to customers for shipping and handling are included as part of the transaction price and recognized as revenue when control of underlying products is transferred to the customer. The related shipping and freight charges incurred by the Company are included in the cost of goods sold. Product Warranties Certain of the Company's medical devices, including monitoring systems and neurosurgical systems, are designed to operate over long periods of time. These products are sold with warranties which may extend for up to two years from the date of purchase. The warranties are not considered a separate performance obligation. The Company estimates its product warranties using the expected value method based on historical trends and other known factors. The Company includes them in accrued expenses and other current liabilities in the consolidated balance sheet. Taxes Collected from Customers The Company elected to exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer. Disaggregated Revenue The following table presents revenues disaggregated by the major sources of revenues for the three months ended March 31, 2019 and 2018 (amounts in thousands): Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 (amounts in thousands) Neurosurgery $ 166,415 $ 166,898 Precision Tools and Instruments 68,153 69,217 Total Codman Specialty Surgical 234,568 236,115 Wound Reconstruction and Care 74,963 72,287 Extremity Orthopedics 22,685 22,635 Private Label 27,474 26,045 Total Orthopedics and Tissue Technologies 125,122 120,967 Total revenue $ 359,690 $ 357,082 Prior period amounts were reclassified between categories within the Orthopedics and Tissue Technologies segment to conform to the current period presentation. See Note 15, Segment and Geographical Information , for details of revenues based on the location of the customer. Effect of Adoption of ASC Topic 606 On January 1, 2018, the Company adopted Topic 606 using the modified retrospective method applied to all contracts which were not completed as of January 1, 2018. Results of operations for the reporting periods after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with Topic 605, Revenue Recognition . The adoption of Topic 606 resulted in an increase to the opening retained earnings of $1.9 million , which was recorded net of taxes as of January 1, 2018 to reflect the change in timing of the recognition of revenue related to the Company's private label business from point in time to over time during the manufacturing process and goods in transit for which control was transferred to customers at the time of shipment. The total assets and liabilities increased by $7.1 million and $5.2 million , respectively, as of January 1, 2018. The impact of adoption in the year of implementation of Topic 606 to the Company's consolidated statement of operations for the three months ended March 31, 2018 was as follows: Three Months Ended March 31, 2018 As Reported Excluding Impact of Topic 606 (Amounts in thousands) Statement of Operations Total revenue, net $ 357,082 $ 356,622 Cost of goods sold 144,222 144,019 Income tax benefit (1,860 ) (1,924 ) Net income 10,992 10,799 |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2019 | |
Inventory, Net [Abstract] | |
INVENTORIES | INVENTORIES Inventories, net consisted of the following: March 31, 2019 December 31, 2018 (In thousands) Finished goods $ 178,263 $ 179,885 Work in process 52,640 47,715 Raw materials 56,059 52,747 $ 286,962 $ 280,347 |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS Changes in the carrying amount of goodwill for the three -month period ended March 31, 2019 were as follows: Codman Specialty Surgical Orthopedics and Tissue Technologies Total (In thousands) Goodwill at December 31, 2018 $ 625,760 $ 300,715 $ 926,475 Foreign currency translation (2,679 ) (1,288 ) (3,967 ) Goodwill at March 31, 2019 $ 623,081 $ 299,427 $ 922,508 The components of the Company’s identifiable intangible assets were as follows: March 31, 2019 Weighted Average Life Cost Accumulated Amortization Net (Dollars in thousands) Completed technology 19 years $ 852,751 $ (178,506 ) $ 674,245 Customer relationships 13 years 231,111 (110,519 ) 120,592 Trademarks/brand names 28 years 103,820 (25,665 ) 78,155 Codman trade name Indefinite 161,025 — 161,025 Supplier relationships 27 years 34,721 (16,876 ) 17,845 All other 4 years 10,844 (4,076 ) 6,768 $ 1,394,272 $ (335,642 ) $ 1,058,630 December 31, 2018 Weighted Average Life Cost Accumulated Amortization Net (Dollars in thousands) Completed technology 19 years $ 855,679 $ (167,384 ) $ 688,295 Customer relationships 13 years 231,448 (106,859 ) 124,589 Trademarks/brand names 28 years 104,061 (24,764 ) 79,297 Codman trade name Indefinite 162,054 — 162,054 Supplier relationships 27 years 34,721 (16,519 ) 18,202 All other 4 years 10,958 (3,899 ) 7,059 $ 1,398,921 $ (319,425 ) $ 1,079,496 Based on quarter-end exchange rates, amortization expense (including amounts reported in cost of product revenues) is expected to be approximately $49.5 million for the remainder of 2019 , $65.8 million in 2020 , $64.7 million in 2021 , $61.2 million in 2022 , $60.3 million in 2023 , $59.5 million in 2024 and $535.9 million thereafter. In April of 2019, a contract manufacturing customer of our Private Label product line received a notification from the FDA ordering them to remove their product from the market. Revenue for this customer was approximately $1.7 million and $0.6 million for the twelve month period ended December 31, 2018 and three month period ended March 31, 2019, respectively. The Company has an acquired customer relationship intangible asset associated with this customer with a carrying value of $5.9 million as of March 31, 2019. The Company is assessing the impact of this decision on our relationship with this customer and any related financial impact including potential future impairments. |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Amended and Restated Senior Credit Agreement On May 3, 2018, the Company entered into the fifth amendment and restatement (the "May 2018 Amendment") of its Senior Credit Facility (the "Senior Credit Facility") with a syndicate of lending banks with Bank of America, N.A., as Administrative Agent. The May 2018 Amendment extended the maturity date to May 3, 2023 and decreased the applicable rate, as described below. The Company continues to have the aggregate principal amount of $2.2 billion available to it through the following facilities: i. a $900.0 million Term Loan facility; and ii. a $1.3 billion revolving credit facility, which includes a $60.0 million sublimit for the issuance of standby letters of credit and a $60.0 million sublimit for swingline loans. In connection with the May 2018 Amendment, the Company’s maximum consolidated total leverage ratio in the financial covenants (as defined in the Senior Credit Facility) was modified to the following: Fiscal Quarter Maximum Consolidated Total Leverage Ratio Execution of May 2018 Amendment through March 31, 2019 5.50 : 1.00 June 30, 2019 through March 31, 2020 5.00 : 1.00 June 30, 2020 through March 31, 2021 4.50 : 1.00 June 30, 2021 and thereafter 4.00 : 1.00 Borrowings under the Senior Credit Facility bear interest, at the Company’s option, at a rate equal to the following: i. the Eurodollar Rate (as defined in the Senior Credit Facility) in effect from time to time plus the applicable rate (ranging from 1.00% to 1.75% ), or ii. the highest of: 1. the weighted average overnight Federal funds rate, as published by the Federal Reserve Bank of New York, plus 0.50% , plus the applicable rate (ranging from 0% to 0.75% ), 2. the prime lending rate of Bank of America, N.A. plus the applicable rate (ranging from 0% to 0.75% ), and 3. the one-month Eurodollar Rate plus 1.00% plus the applicable rate (ranging from 0% to 0.75% ). The applicable rates are based on the Company’s consolidated total leverage ratio (defined as the ratio of (a) consolidated funded indebtedness less cash that is not subject to any restriction on the use or investment thereof to (b) consolidated EBITDA at the time of the applicable borrowing). The Company will pay an annual commitment fee (ranging from 0.15% to 0.30% ), based on the Company's consolidated total leverage ratio, on the amount available for borrowing under the revolving credit facility. The Senior Credit Facility is collateralized by substantially all of the assets of the Company’s U.S. subsidiaries, excluding intangible assets. The Senior Credit Facility is subject to various financial and negative covenants and at March 31, 2019 , the Company was in compliance with all such covenants. In connection with the May 2018 Amendment, the Company capitalized $4.2 million of financing costs and wrote off $0.8 million of previously capitalized financing costs during the second quarter of 2018. At March 31, 2019 and December 31, 2018 , there was $350.0 million and $345.0 million outstanding, respectively, under the revolving credit component of the Senior Credit Facility at weighted average interest rates of 3.9% and 4.0% , respectively. At March 31, 2019 and December 31, 2018 , there was $900.0 million outstanding under the Term Loan component of the Senior Credit Facility at a weighted average interest rate of 3.9% . At March 31, 2019, $33.8 million of the Term Loan component of the Senior Credit Facility is classified as current on the consolidated balance sheet. Securitization Facility During the fourth quarter of 2018, the Company entered into an accounts receivable securitization facility (the "Securitization Facility") under which accounts receivable of certain domestic subsidiaries are sold on a non-recourse basis to a special purpose entity (“SPE”), which is a bankruptcy-remote, consolidated subsidiary of the Company. Accordingly, the assets of the SPE are not available to satisfy the obligations of the Company or any of its subsidiaries. From time to time, the SPE may finance such accounts receivable with a revolving loan facility secured by a pledge of such accounts receivable. The amount of outstanding borrowings on the Securitization Facility at any one time is limited to $150.0 million . The Securitization Facility agreement is for an initial three-year term and may be extended. The agreement governing the Securitization Facility contains certain covenants and termination events. An occurrence of an event of default or a termination event under this Securitization Facility may give rise to the right of its counterparty to terminate this facility. As of March 31, 2019, the Company was in compliance with the covenants, and none of the termination events had occurred. As of March 31, 2019, the Company had $126.0 million of outstanding borrowings under its Securitization Facility at a weighted average interest rate of 3.5% . The fair value of outstanding borrowings of the Senior Credit Facility's revolving credit and Term Loan components at March 31, 2019 was approximately $340.9 million and, $885.3 million , respectively. The fair value of the outstanding borrowing of the Securitization facility at March 31, 2019 was approximately $124.6 million . These fair values were determined by using a discounted cash flow model based on current market interest rates available to the Company. These inputs are corroborated by observable market data for similar liabilities and therefore classified within Level 2 of the fair value hierarchy. Level 2 inputs represent inputs that are observable for the asset or liability, either directly or indirectly, and are other than active market observable inputs that reflect unadjusted quoted prices for identical assets or liabilities. Letters of credit outstanding as of March 31, 2019 and December 31, 2018 totaled $0.6 million . There were no amounts drawn as of March 31, 2019 . Contractual repayments of the Term Loan component of the Senior Credit Facility are due as follows: Year Ended December 31, Principal Repayment (In thousands) Remainder of 2019 $ 22,500 2020 45,000 2021 56,250 2022 67,500 2023 708,750 $ 900,000 The outstanding balance of the revolving credit component of the Senior Credit Facility is due on May 3, 2023. |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS | DERIVATIVE INSTRUMENTS Interest Rate Hedging The Company’s interest rate risk relates to U.S. dollar denominated variable interest rate borrowings. The Company uses interest rate swap derivative instruments to manage earnings and cash flow exposure resulting from changes in interest rates. These interest rate swaps apply a fixed interest rate on a portion of our expected LIBOR-indexed floating-rate borrowings. The Company held the following interest rate swaps as of March 31, 2019 and December 31, 2018 (amounts in thousands): March 31, 2019 December 31, 2018 Hedged Item Current Notional Amount Designation Date Effective Date Termination Date Fixed Interest Rate Estimated Fair Value Estimated Fair Value Assets (Liabilities) Assets (Liabilities) 3-month USD LIBOR Loan $ 50,000 June 22, 2016 December 31, 2016 June 30, 2019 1.062 % $ 193 $ 410 3-month USD LIBOR Loan 50,000 June 22, 2016 December 31, 2016 June 30, 2019 1.062 % 193 415 1-month USD LIBOR Loan 50,000 July 12, 2016 December 31, 2016 June 30, 2019 0.825 % 210 418 3-month USD LIBOR Loan 50,000 February 6, 2017 June 30, 2017 June 30, 2020 1.834 % 393 619 1-month USD LIBOR Loan 100,000 February 6, 2017 June 30, 2017 June 30, 2020 1.652 % 866 1,287 1-month USD LIBOR Loan 100,000 March 27, 2017 December 31, 2017 June 30, 2021 1.971 % 552 1,246 1-month USD LIBOR Loan 150,000 December 13, 2017 January 1, 2018 December 31, 2022 2.201 % (136 ) 1,491 1-month USD LIBOR Loan 150,000 December 13, 2017 January 1, 2018 December 31, 2022 2.201 % (168 ) 1,460 1-month USD LIBOR Loan 100,000 December 13, 2017 July 1, 2019 June 30, 2024 2.423 % (1,059 ) 418 1-month USD LIBOR Loan 50,000 December 13, 2017 July 1, 2019 June 30, 2024 2.423 % (572 ) 162 1-month USD LIBOR Loan 200,000 December 13, 2017 January 1, 2018 December 31, 2024 2.313 % (1,226 ) 2,076 1-month USD LIBOR Loan 75,000 October 10, 2018 July 1, 2020 June 30, 2025 3.220 % (3,726 ) (2,594 ) 1-month USD LIBOR Loan 75,000 October 10, 2018 July 1, 2020 June 30, 2025 3.199 % (3,698 ) (2,551 ) 1-month USD LIBOR Loan 75,000 October 10, 2018 July 1, 2020 June 30, 2025 3.209 % (3,735 ) (2,568 ) 1-month USD LIBOR Loan 100,000 December 18, 2018 December 30, 2022 December 31, 2027 2.885 % (2,426 ) (797 ) 1-month USD LIBOR Loan 100,000 December 18, 2018 December 30, 2022 December 31, 2027 2.867 % (2,337 ) (873 ) Total interest rate derivatives designated as cash flow hedge $ 1,475,000 $ (16,676 ) $ 619 The Company has designated these derivative instruments as cash flow hedges. The Company assesses the effectiveness of these derivative instruments and has recorded the changes in the fair value of the derivative instrument designated as a cash flow hedge as unrealized gains or losses in accumulated other comprehensive income (“AOCI”), net of tax, until the hedged item affected earnings, at which point any gain or loss was reclassified to earnings. If the hedged cash flow does not occur, or if it becomes probable that it will not occur, the Company will reclassify the remaining amount of any gain or loss on the related cash flow hedge recorded in AOCI to interest expense at that time. Foreign Currency Hedging From time to time the Company enters into foreign currency hedge contracts intended to protect the U.S. dollar value of certain forecasted foreign currency denominated transactions. The Company assesses the effectiveness of the contracts that are designated as hedging instruments. The changes in fair value of foreign currency cash flow hedges are recorded in AOCI, net of tax, until the hedged item affects earnings. Once the related hedged item affects earnings, the Company reclassifies amounts recorded in AOCI to earnings. If the hedged forecasted transaction does not occur, or if it becomes probable that it will not occur, the Company will reclassify the amount of any gain or loss on the related cash flow hedge to earnings at that time. For contracts not designated as hedging instruments, the changes in fair value of the contracts are recognized in other income (expense), net in the consolidated statements of operation, along with the offsetting foreign currency gain or loss on the underlying assets or liabilities. The success of the Company’s hedging program depends, in part, on forecasts of certain activity denominated in foreign currency. The Company may experience unanticipated currency exchange gains or losses to the extent that there are differences between forecasted and actual activities during periods of currency volatility. In addition, changes in currency exchange rates related to any unhedged transactions may affect earnings and cash flows. Cross-Currency Rate Swaps On October 2, 2017, the Company entered into cross-currency swap agreements to convert a notional amount of $300.0 million equivalent to 291.2 million of CHF denominated intercompany loans into U.S. dollars. The CHF-denominated intercompany loans were the result of the purchase of intellectual property by a subsidiary in Switzerland as part of the Codman Acquisition. The objective of these cross-currency swaps is to reduce volatility of earnings and cash flows associated with changes in the foreign currency exchange rate. Under the terms of these contracts, which have been designated as cash flow hedges, the Company will make interest payments in Swiss Francs and receive interest in U.S. dollars. Upon the maturity of these contracts, the Company will pay the principal amount of the loans in Swiss Francs and receive U.S. dollars from the counterparties. The Company held the following cross-currency rate swaps as of March 31, 2019 (dollar amounts in thousands): March 31, 2019 Effective Date Termination Date Fixed Rate Aggregate Notional Amount Fair Value Asset (Liability) Pay CHF October 2, 2017 October 2, 2020 1.75% CHF 64,710 $ 1,062 Receive U.S.$ 4.38% $ 66,667 Pay CHF October 2, 2017 October 2, 2021 1.85% CHF 48,533 575 Receive U.S.$ 4.46% $ 50,000 Pay CHF October 2, 2017 October 2, 2022 1.95% CHF 145,598 1,078 Receive U.S.$ 4.52% $ 150,000 Total $ 2,715 During the three months ended March 31, 2019, the Company settled a cross-currency swap designated as a cash flow hedge of an intercompany loan with an aggregate notional amount of $33.3 million . The original termination date was October 2, 2020, however, as the intercompany loan settlement was consummated during the three months ended March 31, 2019, the cross-currency swap was settled simultaneously. As a result of the settlement, the Company recorded a loss of $0.4 million in other income, net in the consolidated statement of operations. The Company held the following cross-currency rate swaps as of December 31, 2018 (dollar amounts in thousands): December 31, 2018 Effective Date Termination Date Fixed Rate Aggregate Notional Amount Fair Value Asset (Liability) Pay CHF October 2, 2017 October 2, 2020 1.75% CHF 97,065 $ (215 ) Receive U.S.$ 4.38% $ 100,000 Pay CHF October 2, 2017 October 2, 2021 1.85% CHF 48,533 (422 ) Receive U.S.$ 4.46% $ 50,000 Pay CHF October 2, 2017 October 2, 2022 1.95% CHF 145,598 (2,193 ) Receive U.S.$ 4.52% $ 150,000 Total $ (2,830 ) The cross-currency swaps are carried on the consolidated balance sheet at fair value, and changes in the fair values are recorded as unrealized gains or losses in AOCI. For the three months ended March 31, 2019 and 2018 , the Company recorded a gain of $3.3 million and loss of $6.4 million , respectively, in other income (expense), net for the foreign currency rate translation to offset the gains or losses recognized on the intercompany loans. For the three months ended March 31, 2019 and 2018 , the Company recorded a gain of $5.5 million and a loss of $7.0 million , respectively, in AOCI related to the change in fair value of the cross-currency swap. For the three months ended March 31, 2019 and 2018 , the Company recorded gains of $1.9 million in other income, net included in the consolidated statements of operations related to the interest rate differential of the cross-currency swap. As of March 31, 2019 , an estimated gain of $6.8 million is expected to be reclassified within the next twelve months to other income, net from AOCI. As of March 31, 2019 , the Company does not expect any gains or losses will be reclassified into earnings as a result of the discontinuance of these cash flow hedges because the original forecasted transaction will not occur. Net Investment Hedges The Company manages certain foreign exchange risks through a variety of strategies, including hedging. The Company is exposed to foreign exchange risk in its international operations from foreign currency purchases, net investments in foreign subsidiaries, and foreign currency assets and liabilities created in the normal course of business. On October 1, 2018, the Company entered into cross-currency swap agreements designated as net investment hedges to partially offset the effects of foreign currency on foreign subsidiaries. The Company held the following cross-currency rate swaps designated as net investment hedges as of March 31, 2019 and December 31, 2018 , respectively (dollar amounts in thousands): March 31, 2019 December 31, 2018 Effective Date Termination Date Fixed Rate Aggregate Notional Amount Fair Value Asset (Liability) Fair Value Asset (Liability) Pay EUR October 3, 2018 September 30, 2021 — EUR 70,738 $ 3,343 $ 1,359 Receive U.S.$ 3.01% $ 82,000 Pay EUR October 3, 2018 September 30, 2023 — EUR 51,760 2,175 (421 ) Receive U.S.$ 2.57% $ 60,000 Pay EUR October 3, 2018 September 30, 2025 — EUR 38,820 1,037 (150 ) Receive U.S.$ 2.19% $ 45,000 Pay GBP October 3, 2018 September 30, 2025 1.67% GBP 128,284 (1,026 ) 2,360 Receive U.S.$ 2.71% $ 167,500 Pay CHF October 3, 2018 September 30, 2025 — CHF 165,172 1,731 (3,780 ) Receive GBP 1.67% GBP 128,284 Total $ 7,260 $ (632 ) The cross-currency swaps were carried on the consolidated balance sheet at fair value, and changes in the fair values were recorded as unrealized gains or losses in AOCI. For the three months ended March 31, 2019 , the Company recorded a gain of $7.9 million in AOCI related to the change in fair value of the cross-currency swaps. For the three months ended March 31, 2019 , the Company recorded a gain of $2.3 million in interest income included in the consolidated statements of operations related to the interest rate differential of the cross-currency swaps. The estimated gain that is expected to be reclassified to interest income from AOCI as of March 31, 2019 within the next twelve months is $8.9 million . Counterparty Credit Risk The Company manages its concentration of counterparty credit risk on its derivative instruments by limiting acceptable counterparties to a group of major financial institutions with investment grade credit ratings, and by actively monitoring their credit ratings and outstanding positions on an ongoing basis. Therefore, the Company considers the credit risk of the counterparties to be low. Furthermore, none of the Company’s derivative transactions are subject to collateral or other security arrangements, and none contain provisions that depend upon the Company’s credit ratings from any credit rating agency. Fair Value of Derivative Instruments The Company has classified all of its derivative instruments within Level 2 of the fair value hierarchy because observable inputs are available for substantially the full terms of the derivative instruments. The fair value of the interest rate swaps and the cross-currency swaps was developed using a market approach based on publicly available market yield curves and the terms of the related swap. The Company performs ongoing assessments of counterparty credit risk. The following table summarizes the fair value and presentation for derivatives designated as hedging instruments in the condensed consolidated balance sheets as of March 31, 2019 and December 31, 2018 : Fair Value as of Location on Balance Sheet (1) : March 31, 2019 December 31, 2018 (In thousands) Derivatives designated as hedges — Assets: Prepaid expenses and other current assets Cash Flow Hedges Interest rate swap (2) $ 2,738 $ 4,654 Cross-currency swap 6,849 7,615 Net Investment Hedges Cross-currency swap 8,910 8,888 Other assets Cash Flow Hedges Interest rate swap (2) 346 5,350 Net Investment Hedges Cross-currency swap 1,532 1,774 Total derivatives designated as hedges — Assets $ 20,375 $ 28,281 Derivatives designated as hedges — Liabilities: Accrued expenses and other current liabilities Cash Flow Hedges Interest rate swap (2) $ 87 $ — Other liabilities Cash Flow Hedges Interest rate swap (2) 19,672 9,385 Cross-currency swap 4,134 10,445 Net Investment Hedges Cross-currency swap 3,181 11,294 Total derivatives designated as hedges — Liabilities $ 27,074 $ 31,124 (1) The Company classifies derivative assets and liabilities as non-current based on the cash flows expected to be incurred within the following 12 months. (2) At March 31, 2019 and December 31, 2018 , the notional amount related to the Company’s interest rate swaps were $1.5 billion . The following presents the effect of derivative instruments designated as cash flow hedges on the accompanying condensed consolidated statement of operations during the three months ended March 31, 2019 and 2018 : Balance in AOCI Beginning of Quarter Amount of Gain (Loss) Recognized in AOCI Amount of Gain (Loss) Reclassified from AOCI into Earnings Balance in AOCI End of Quarter Location in Statements of Operations (In thousands) Three Months Ended March 31, 2019 Cash Flow Hedges Interest rate swap $ 619 $ (15,891 ) $ 1,406 $ (16,678 ) Interest income Cross-currency swap (6,190 ) 7,473 5,178 (3,895 ) Other income, net Net Investment Hedges Cross-currency swap (632 ) 10,221 2,327 7,262 Interest income $ (6,203 ) $ 1,803 $ 8,911 $ (13,311 ) Three Months Ended March 31, 2018 Cash Flow Hedges Interest rate swap $ 592 $ 14,940 $ (656 ) $ 16,188 Interest expense Cross-currency swap (5,104 ) (7,027 ) (4,454 ) (7,677 ) Other income, net $ (4,512 ) $ 7,913 $ (5,110 ) $ 8,511 |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION As of March 31, 2019 , the Company had stock options, restricted stock awards, performance stock units, contract stock awards and restricted stock unit awards outstanding under two plans, the 2001 Equity Incentive Plan (the “2001 Plan”) and the 2003 Equity Incentive Plan (the “2003 Plan,” and collectively, the “Plans”). Stock options issued under the Plans become exercisable over specified periods, generally within four years from the date of grant for officers and employees, and within one year from date of grant for directors and generally expire eight years from the grant date for employees, and from six to ten years for directors and certain executive officers. The Company values stock option grants using the binomial distribution model. Restricted stock issued under the Plans vests over specified periods, generally three years after the date of grant. The vesting of performance stock issued under the Plans is subject to service and performance conditions. Stock Options As of March 31, 2019 , there were approximately $7.0 million of total unrecognized compensation costs related to unvested stock options. These costs are expected to be recognized over a weighted-average period of approximately over three years . There were 202,752 stock options granted during the three months ended March 31, 2019 . For the three months ended March 31, 2019, the weighted average grant date fair value for stock options was $18.74 per option. Awards of Restricted Stock and Performance Stock Performance stock and restricted stock awards generally have requisite service periods of three years. Performance stock units are subject to graded vesting conditions, and the Company expenses their fair value over the requisite service period. The Company expenses the fair value of restricted stock awards on a straight-line basis over the requisite service period. As of March 31, 2019 , there were approximately $33.6 million of total unrecognized compensation costs related to these unvested awards. The Company expects to recognize these costs over a weighted-average period of approximately over two years . The Company granted 215,662 restricted stock awards and 118,903 performance stock awards during the three months ended March 31, 2019 . For the three months ended March 31, 2019, the weighted average grant date fair value for restricted stock awards and performance stock units was $55.62 and $55.91 per award, respectively. The Company has no formal policy related to the repurchase of stock for the purpose of satisfying stock-based compensation obligations. The Company also maintains an Employee Stock Purchase Plan (the “ESPP”), which provides eligible employees with the opportunity to acquire shares of common stock at periodic intervals by means of accumulated payroll deductions. The ESPP is a non-compensatory plan based on its terms. |
DEFINED BENEFIT PLANS
DEFINED BENEFIT PLANS | 3 Months Ended |
Mar. 31, 2019 | |
Retirement Benefits [Abstract] | |
DEFINED BENEFIT PLANS | DEFINED BENEFIT PLANS The Company maintains defined benefit pension plans that cover certain employees in Austria, France, Japan, Germany and Switzerland. Net periodic benefit costs for the Company’s defined benefit pension plans for the three months ended March 31, 2019 and 2018 were $0.5 million and $0.6 million , respectively. The components of the net periodic benefit costs other than the service cost component of $0.7 million for the three months ended March 31, 2019 and 2018, respectively, are included in other income (expense), net in the consolidated statements of operations. The Company previously disclosed in its consolidated financial statements for the year ended December 31, 2018 that it expected to contribute $1.9 million to its defined benefit pension plans in 2019 . For the three months ended March 31, 2019 , the Company did no t make a contribution to the defined benefit plans. As of March 31, 2019 , the Company anticipates contributing $1.9 million to its defined benefit plans in 2019 . The estimated fair values of plan assets were $30.1 million and $31.1 million as of March 31, 2019 and December 31, 2018 , respectively. The net plan assets of the pension plans are invested in common trusts as of March 31, 2019 and December 31, 2018 . Common trusts are classified as Level 2 in the fair value hierarchy. The fair value of common trusts is valued at the net asset value based on the fair values of the underlying investments of the trusts as determined by the sponsor of the trusts. The investment strategy of the Company's defined benefit plans is both to meet the liabilities of the plans as they fall due and to maximize the return on invested assets within an appropriate risk profile. |
LEASES AND RELATED PARTY LEASES
LEASES AND RELATED PARTY LEASES | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
LEASES AND RELATED PARTY LEASES | LEASES AND RELATED PARTY LEASES The Company leases administrative, manufacturing, research and distribution facilities and vehicles through operating lease agreements. The Company has no finance leases as of March 31, 2019 . Many of our leases include both lease (e.g., fixed payments including rent) and non-lease components (e.g., common-area or other maintenance costs). For vehicles, we have elected the practical expedient to group lease and non-lease components. Most facility leases include one or more options to renew. The exercise of lease renewal options is typically at our sole discretion, therefore, the majority of renewals to extend the lease terms are not included in our ROU assets and lease liabilities as they are not reasonably certain of exercise. We regularly evaluate the renewal options and when they are reasonably certain of exercise, we include the renewal period in our lease term. As most of our leases do not provide an implicit rate, we use our collateralized incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. Total operating lease expense for the three months ended March 31, 2019 and March 31, 2018, was $4.4 million and $3.4 million respectively, which includes $0.1 million , in related party operating lease expense. Supplemental balance sheet information related to operating leases at March 31, 2019 were as follows: March 31, 2019 (In thousands, except lease term and discount rate) ROU assets $ 64,999 Current lease liabilities $ 12,619 Non-current lease liabilities 61,711 Total lease liabilities $ 74,330 Weighted average remaining lease term (in years): Leased facilities 9.9 Leased vehicles 3.4 Weighted average discount rate: Leased facilities 5.7 % Leased vehicles 3.2 % ROU assets were included in other assets at March 31, 2019 . Current lease liabilities were included in accrued expenses and other current liabilities and non-current lease liabilities were included in other liabilities at March 31, 2019 . Supplemental cash flow information related to leases was as follows for the three months ended March 31, 2019 (in thousands): March 31, 2019 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 3,408 ROU assets obtained in exchange for lease liabilities: Operating leases 2,004 Future minimum lease payments under operating leases at March 31, 2019 were as follows: Related Parties Third Parties Total (In thousands) 2019 $ 222 $ 11,641 $ 11,863 2020 296 12,409 12,705 2021 296 11,532 11,828 2022 296 9,154 9,450 2023 296 7,282 7,578 Thereafter 1,724 40,893 42,617 Total minimum lease payments $ 3,130 $ 92,911 $ 96,041 Less: Imputed interest 21,711 Total lease liabilities 74,330 Less: Current lease liabilities 12,619 Long-term lease liabilities 61,711 During 2018, the Company entered into a lease for a new corporate headquarters in Princeton, NJ which is expected to commence during the second quarter of 2019. Total payments over the lease term are approximately $67.0 million . The payments are not included in the table above as the lease has yet to commence. Future minimum lease payments under operating leases at December 31, 2018 were as follows: Related Parties Third Parties Total (In thousands) 2019 $ 296 $ 16,472 $ 16,768 2020 296 13,510 13,806 2021 296 12,197 12,493 2022 296 12,937 13,233 2023 296 10,707 11,003 Thereafter 1,724 100,675 102,399 Total minimum lease payments $ 3,204 $ 166,498 $ 169,702 Total operating lease expense for the year ended December 31, 2018 was $16.3 million and included $0.3 million , in related party lease expense. Future lease expense for the new corporate headquarters in Princeton, NJ is included in the table above, however, has not yet commenced. There were no future minimum lease payments under capital leases at December 31, 2018 . Related Party Leases The Company leases its manufacturing facility in Plainsboro, New Jersey, from a general partnership that is 50% owned by a corporation whose shareholders are trusts, whose beneficiaries include family members of the Company’s principal stockholder and former director. The term of the current lease agreement is through October 31, 2032 at an annual rate of approximately $0.3 million per year. The current lease agreement also provides (i) a 5 -year renewal option for the Company to extend the lease from November 1, 2032 through October 31, 2037 at the fair market rental rate of the premises, and (ii) another 5 -year renewal option to extend the lease from November 1, 2037 through October 31, 2042 at the fair market rental rate of the premises. |
TREASURY STOCK
TREASURY STOCK | 3 Months Ended |
Mar. 31, 2019 | |
Treasury Stock Transactions, Excluding Value of Shares Reissued [Abstract] | |
TREASURY STOCK | TREASURY STOCK As of March 31, 2019 and December 31, 2018 , there were 2.9 million shares of treasury stock outstanding with a cost of $120.1 million and $120.6 million , respectively, at a weighted average cost per share of $41.87 and $41.87 , respectively. On December 11, 2018, the Board of Directors authorized the Company to repurchase up to $225.0 million of the Company’s common stock. The program allows the Company to repurchase its shares opportunistically from time to time. The repurchase authorization expires in December 2020. Purchases may be affected through one or more open market transactions, privately negotiated transactions, transactions structured through investment banking institutions, or a combination of the foregoing. As of March 31, 2019 , there remained $225.0 million available for repurchase under this authorization. This stock repurchase authorization replaces the previous $150.0 million stock repurchase authorization, approved by the Board in 2016. There were no cash treasury stock repurchases during the three months ended March 31, 2019 and 2018 . |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The following table provides a summary of the Company's effective tax rate: Three Months Ended March 31, 2019 2018 Reported tax rate (32.0 )% (20.4 )% The Company’s effective income tax rates for the three months ended March 31, 2019 and 2018 were (32.0)% and (20.4)% , respectively. For the three months ended March 31, 2019 , the primary driver of the reduction in the rate is a tax benefit of $10.8 million ( $0.13 per share) related to a federal tax holiday in Switzerland, which was finalized during the quarter ended March 31, 2019. The Company received a Switzerland federal tax credit of 12 million CHF, which can be used over a seven year period, ending in 2024. As of March 31, 2019, the Company has not provided deferred income taxes on unrepatriated earnings from foreign subsidiaries as they are deemed indefinitely reinvested. Such taxes would primarily be attributable to foreign withholding taxes and local income taxes when such earnings are distributed. As such, the Company has determined the tax impact of repatriating these earnings would not be material as of March 31, 2019. |
NET INCOME PER SHARE
NET INCOME PER SHARE | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
NET INCOME PER SHARE | NET INCOME PER SHARE Basic and diluted net income per share was as follows: Three Months Ended March 31, 2019 2018 (In thousands, except per share amounts) Basic net income per share: Net income $ 32,756 $ 10,992 Weighted average common shares outstanding 85,343 78,552 Basic net income per common share $ 0.38 $ 0.14 Diluted net income per share: Net income $ 32,756 $ 10,992 Weighted average common shares outstanding — Basic 85,343 78,552 Effect of dilutive securities: Stock options and restricted stock 915 1,282 Weighted average common shares for diluted earnings per share 86,258 79,834 Diluted net income per common share $ 0.38 $ 0.14 Shares of common stock of approximately 0.3 million and 0.2 million at March 31, 2019 and 2018 , respectively, that are issuable through the exercise of dilutive securities were not included in the computation of diluted net income per share because their effect would have been antidilutive. Vested restricted and performance units that entitle the holders to approximately 0.5 million shares of common stock are included in the basic and diluted weighted average shares outstanding calculation because no further consideration is due related to the issuance of the underlying common shares. |
COMPREHENSIVE INCOME
COMPREHENSIVE INCOME | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
COMPREHENSIVE INCOME | COMPREHENSIVE INCOME Comprehensive income was as follows: Three Months Ended March 31, 2019 2018 (In thousands) Net income $ 32,756 $ 10,992 Foreign currency translation adjustment (7,009 ) 13,780 Change in unrealized gain (loss) on derivatives, net of tax (4,236 ) 7,838 Pension liability adjustment, net of tax 9 (6 ) Comprehensive income, net $ 21,520 $ 32,604 Changes in Accumulated Other Comprehensive Income by component between December 31, 2018 and March 31, 2019 are presented in the table below, net of tax: Gains and Losses on Derivatives Defined Benefit Pension Items Foreign Currency Items Total (In thousands) Balance at January 1, 2019 $ (4,813 ) $ (736 ) $ (39,894 ) $ (45,443 ) Other comprehensive income (loss) 2,516 9 (7,009 ) (4,484 ) Less: Amounts reclassified from accumulated other comprehensive income 6,752 — — 6,752 Net current-period other comprehensive income (loss) (4,236 ) 9 (7,009 ) (11,236 ) Balance at March 31, 2019 $ (9,049 ) $ (727 ) $ (46,903 ) $ (56,679 ) For the three months ended March 31, 2019 , the Company reclassified gains of $4.0 million and $2.8 million from AOCI to other income (expenses), net, and interest income, respectively. |
SEGMENT AND GEOGRAPHIC INFORMAT
SEGMENT AND GEOGRAPHIC INFORMATION | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT AND GEOGRAPHIC INFORMATION | SEGMENT AND GEOGRAPHIC INFORMATION The Company internally manages two global reportable segments and reports the results of its businesses to its chief operating decision maker. The two reportable segments and their activities are described below. • The Codman Specialty Surgical segment includes (i) the Neurosurgery business, which sells a full line of products for neurosurgery and neuro critical care such as tissue ablation equipment, dural repair products, cerebral spinal fluid management devices, intracranial monitoring equipment, and cranial stabilization equipment and (ii) the precision tools and instruments business, which sells more than 60,000 instrument patterns and surgical and lighting products to hospitals, surgery centers, dental, podiatry, and veterinary offices. • The Orthopedics and Tissue Technologies segment includes such offerings as skin and wound repair, bone and joint fixation implants in the upper and lower extremities, bone grafts and nerve and tendon repair products. The Corporate and other category includes (i) various executive, finance, human resource, information systems, legal functions, (ii) brand management, and (iii) share-based compensation costs. The operating results of the various reportable segments as presented are not comparable to one another because (i) certain operating segments are more dependent than others on corporate functions for unallocated general and administrative and/or operational manufacturing functions and (ii) the Company does not allocate certain manufacturing costs and general and administrative costs to the operating segment results. Net sales and profit by each reportable segment for the three months ended March 31, 2019 and 2018 are as follows: Three Months Ended March 31, 2019 2018 (In thousands) Segment Net Sales Codman Specialty Surgical $ 234,568 $ 236,115 Orthopedics and Tissue Technologies 125,122 120,967 Total revenues $ 359,690 $ 357,082 Segment Profit Codman Specialty Surgical $ 91,380 $ 89,491 Orthopedics and Tissue Technologies 40,495 32,438 Segment profit 131,875 121,929 Amortization (5,279 ) (5,390) Corporate and other (94,288 ) (90,960 ) Operating income $ 32,308 $ 25,579 The Company does not allocate any assets to the reportable segments. No asset information is reported to the chief operating decision maker and disclosed in the financial information for each segment. The Company attributes revenues to geographic areas based on the location of the customer. Total revenue by major geographic area consisted of the following: Three Months Ended March 31, 2019 2018 (In thousands) United States $ 256,726 $ 248,928 Europe 48,640 51,773 Asia Pacific 35,700 35,785 Rest of World 18,624 20,596 Total Revenues $ 359,690 $ 357,082 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Contingent Consideration The Company determined the fair value of contingent consideration during the three -month period ended March 31, 2019 and 2018 to reflect the change in estimates, additions, payments, transfers and the time value of money during the period. A reconciliation of the opening balances to the closing balances of these Level 3 measurements for the three months ended March 31, 2019 and 2018 is as follows (in thousands): Three Months Ended March 31, 2019 Contingent Consideration Liability Related to Acquisition of Derma Long-term Balance as of January 1, 2019 $ 230 Balance as of March 31, 2019 $ 230 Three Months Ended March 31, 2018 Contingent Considerations Liabilities Related to Acquisition of Derma Contingent Consideration Liability Related to Acquisition of Confluent Surgical, Inc. Location in Financial Statements Short-term Long-term Short-term Balance as of January 1, 2018 $ 315 $ 1,387 $ 22,478 Loss from change in fair value of contingent consideration liabilities — 32 1,422 Selling, general and administrative Balance as of March 31, 2018 $ 315 $ 1,419 $ 23,900 On January 15, 2014, the Company acquired all outstanding shares of Confluent Surgical, Inc., ("Confluent Surgical"). The purchase price includes contingent consideration. The potential maximum undiscounted contingent consideration of $30.0 million consists of $25.0 million upon obtaining certain U.S. governmental approvals (the "U.S. Contingent Consideration") and $5.0 million upon obtaining certain European governmental approvals, both related to the completion of the transition of the Confluent Surgical business. The U.S. Contingent Consideration is subject to adjustment to reduce the amount of maximum payment based on the timing of obtaining the U.S. governmental approval up to the minimum of $19.0 million . The fair values of contingent consideration related to the acquisition of Confluent Surgical were estimated using a discounted cash flow model using discount rate of 2.2% . During the first quarter of 2018, the Company received the U.S. governmental approvals and adjusted the related contingent consideration liability to $19.0 million , which the Company paid in April 2018. During the third quarter of 2018, the Company received certain European governmental approvals. The Company paid the remaining $5.0 million of contingent consideration related to Confluent Surgical in October of 2018. The Company assumed contingent consideration incurred by Derma Sciences related to its acquisitions of BioD and the intellectual property related to the Medihoney product. The Company accounted for the contingent liabilities by recording their fair value on the date of the acquisition based on a discounted cash-flow model. The contingent liabilities recognized as part of the Derma Sciences acquisition relate to the following: i. contractual incentive payments that could be made to former equity owners of BioD if net sales of BioD products exceed a certain amount for the twelve-month periods ending June 30, 2017 and 2018 ("BioD Earnout Payments"); ii. a contractual incentive payment that could be made to the former equity owners if there has been no specific enforcement action or notice by the FDA against the specific BioD products as a result of the Untitled Letter for a certain period after closing as defined by the agreement ("Product Payment"); and iii. contractual incentive payments that could be made to the former owner of the intellectual property relating to the Medihoney product line, if net sales of Medihoney products exceed certain amounts defined in the agreement between Derma Sciences and the former owner of the intellectual property of Medihoney for any twelve-month period ("Medihoney Earnout Payments"). At the date of the acquisition, net sales used in estimating the BioD Earnout Payments was based on the weighted average of different possible scenarios using a revenue volatility of 13.5% . The BioD Earnout Payments were valued using a discount rate of 3.0% . The maximum payout related to the BioD Earnout Payments is $26.5 million . The estimated fair value as of February 24, 2017 was $9.1 million . In August 2017, the Company paid $4.8 million for the twelve-month period ending June 30, 2017 component of the BioD Earnout Payments. The Company made no additional payments after the final earn out period. The estimated fair value as of March 31, 2018 was $0.3 million . On May 25, 2017, the Company made full payment for the Product Payment of $26.6 million . At the date of the acquisition, the net sales used in estimating the Medihoney Earnout Payments were based on the weighted average of different possible scenarios using revenue volatility of 27.5% . The Medihoney Earnout Payments were valued using a discount rate of 4.5% . The maximum payout related to the Medihoney Earnout Payments is $5.0 million . During the second quarter of 2018, the Company paid $2.0 million for the Medihoney Earnout Payment. The estimated fair value as of March 31, 2019 and December 31, 2018 was $0.2 million . The estimated fair value as of March 31, 2018 was $1.4 million . The Company assesses these assumptions on an ongoing basis as additional information affecting the assumptions is obtained. The contingent consideration balance was included in other liabilities at March 31, 2019 and accrued expenses and other current liabilities and other liabilities at March 31, 2018 . BioD On April 7, 2017, the Company's indirect wholly-owned subsidiary, BioD filed an action in the Superior Court of New Jersey, Chancery Division, Middlesex County seeking a declaration that the resignation of Russell Olsen, the former CEO of BioD, was “for Good Reason” (as defined in Olsen’s employment agreement); a finding that Olsen breached the implied covenant of good faith and fair dealing, committed legal fraud, equitable fraud and negligent misrepresentation; and an award of damages for such actions, including a return of severance fees paid to Olsen. BioD was acquired in August 2016 by Derma Sciences, which Integra subsequently acquired in February 2017. After receiving a job offer from Integra that Olsen believed materially diminished his title and authority, on February 24, 2017 Olsen indicated his intention to terminate his position with BioD for Good Reason, as otherwise permitted by his employment agreement with BioD. Shortly thereafter, Cynthia Weatherly (as representative of the former equity owners of BioD) claimed in a letter to Derma Sciences that Olsen’s resignation was a “termination Without Cause” (as also defined in Olsen’s employment agreement), which would arguably trigger an acceleration of the earn out under a merger agreement between Derma Sciences, BioD and other parties (the "BioD Merger Agreement"), which was entered into in July 2016, and require as a result of the acceleration of the payment of $26.5 million by BioD. Integra assumed this contingent liability in connection with its acquisition of Derma Sciences. The action for a declaratory judgment was filed to clarify that Olsen’s termination was for Good Reason and not Without Cause. If the employment agreement was terminated for Good Reason, then the Company believes that the earn out provision under the BioD Merger Agreement should not be accelerated. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (the New Lease Standard) . The New Lease Standard requires that lessees recognize virtually all of its leases on the balance sheet by recording a right-of-use asset and lease liability (other than leases that meet the definition of a "short-term lease"). This update became effective for all annual periods and interim reporting periods beginning after December 15, 2018. The Company adopted the New Lease Standard as of January 1, 2019 using a modified retrospective transition. Under this method, financial results reported in periods prior to January 1, 2019 are unchanged. The Company also elected the package of practical expedients, which among other things, does not require reassessment of lease classification. As most of our leases do not provide an implicit rate, we used our collateralized incremental borrowing rate based on the information available at the lease implementation date in determining the present value of the lease payments. The adoption of the New Lease Standard had an impact on our consolidated balance sheet due to the recognition of $76.4 million of lease liabilities with corresponding right-of-use assets ("ROU") of $67.3 million for operating leases. The difference between lease liabilities and right-of-use assets is primarily attributed to unamortized lease incentives which will be amortized over the term of each respective lease. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) : Measurement of Credit Losses on Financial Instruments. The ASU is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The ASU requires the measurement of all expected credit losses for financial assets including trade receivables held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Company is evaluating the impact, if any, that this pronouncement will have on our financial position and results of operations. In August 2018, the FASB issued ASU 2018-14, Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20): Disclosure Framework-Changes to the Disclosure Requirements for Defined Benefit Plans. The new guidance modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans, including removing certain previous disclosure requirements, adding certain new disclosure requirements, and clarifying certain other disclosure requirements. The ASU will be effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Early adoption is permitted. The adoption is not expected to have a material impact on the Condensed and Consolidated Financial Statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40) , relating to a customer's accounting for implementation, set-up, and other upfront costs incurred in a cloud computing arrangement that is hosted by a vendor (i.e., a service contract). Under the new guidance, a customer will apply the same criteria for capitalizing implementation costs as it would for an arrangement that has a software license. The new guidance also prescribes the balance sheet, income statement, and cash flow classification of the capitalized implementation costs and related amortization expense, and requires additional quantitative and qualitative disclosures. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application is permitted. The Company can choose to adopt the new guidance (1) prospectively to eligible costs incurred on or after the date this guidance is first applied or (2) retrospectively. The Company is evaluating the impact, if any, that this pronouncement will have on our financial position and results of operations. There are no other recently issued accounting pronouncements that are expected to have any significant effect on the Company's financial position, results of operations or cash flows. |
Summary of Accounting Policies on Revenue Recognition and Shipping and Handling Fees | Summary of Accounting Policies on Revenue Recognition Revenue is recognized upon the transfer of control of promised products or services to the customers in an amount that reflects the consideration the Company expects to receive in exchange for those products and services. Total revenue, net, includes product sales, product royalties and other revenues, such as fees received for services. For products shipped with FOB shipping point terms, the control of the product passes to the customer at the time of shipment. For shipments in which the control of the product is transferred when the customer receives the product, the Company recognizes revenue upon receipt by the customer. Certain products that the Company produces for private label customers have no alternative use and the Company has a right of payment for performance to date. Revenues from those products are recognized over the period that the Company manufactures these products, which is typically one to three months. The Company uses the input method to measure the manufacturing activities completed to date, which depicts the progress of the Company's performance obligation of transferring control of goods being manufactured for private label customers. A portion of the Company's product revenue is generated from consigned inventory maintained at hospitals and distributors, and also from inventory physically held by field sales representatives. For these types of products sales, the Company retains control until the product has been used or implanted, at which time revenue is recognized. Revenues from sale of products and services are evidenced by either a contract with the customer or a valid purchase order and an invoice which includes all relevant terms of sale. For product sales, invoices are generally issued upon the transfer of control (or upon the completion of the manufacturing in the case of the private label transactions recognized over time) and are typically payable thirty days after the invoice date. The Company performs a review of each specific customer's creditworthiness and ability to pay prior to acceptance as a customer. Further, the Company performs periodic reviews of its customers' creditworthiness prospectively. Performance Obligations The Company's performance obligations consist mainly of transferring control of goods and services identified in the contracts, purchase orders, or invoices. The Company has no significant multi-element contracts with customers. Significant Judgments Usage-based royalties and licenses are estimated based on the provisions of contracts with customers and recognized in the same period that the royalty-based products are sold by the Company's strategic partners. The Company estimates and recognizes royalty revenue based upon communication with licensees, historical information, and expected sales trends. Differences between actual reported licensee sales and those that were estimated are adjusted in the period in which they become known, which is typically the following quarter. Historically, such adjustments have not been significant. The Company estimates returns, price concessions, and discount allowances using the expected value method based on historical trends and other known factors. Rebate allowances are estimated using the most likely method based on each customer contract. The Company's return policy, as set forth in its product catalogs and sales invoices, requires the Company to review and authorize the return of a product in advance. Upon the authorization, a credit will be issued for the goods returned within a set amount of days from the shipment, which is generally ninety days. The Company disregards the effects of a financing component if the Company expects, at contract inception, that the period between the transfer and customer payment for the good or services will be one year or less. The Company has no significant revenues recognized on payments expected to be received more than one year after the transfer of control of products or services to customers. Contract Asset and Liability Revenues recognized from the Company's private label business that are not invoiced to the customers as a result of recognizing revenue over time are recorded as a contract asset included in the prepaid expenses and other current assets account in the consolidated balance sheet. Other operating revenues may include fees received under service agreements. Non-refundable fees received under multiple-period service agreements are recognized as revenue as the Company satisfies the performance obligations to the other party. A portion of the transaction price allocated to the performance obligations to be satisfied in the future periods is recognized as contract liability. Shipping and Handling Fees The Company elected to account for shipping and handling activities as a fulfillment cost rather than a separate performance obligation. Amounts billed to customers for shipping and handling are included as part of the transaction price and recognized as revenue when control of underlying products is transferred to the customer. The related shipping and freight charges incurred by the Company are included in the cost of goods sold. |
Product Warranties | Product Warranties Certain of the Company's medical devices, including monitoring systems and neurosurgical systems, are designed to operate over long periods of time. These products are sold with warranties which may extend for up to two years from the date of purchase. The warranties are not considered a separate performance obligation. The Company estimates its product warranties using the expected value method based on historical trends and other known factors. The Company includes them in accrued expenses and other current liabilities in the consolidated balance sheet. |
Taxes Collected from Customers | Taxes Collected from Customers The Company elected to exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer. |
REVENUES FROM CONTRACTS WITH _2
REVENUES FROM CONTRACTS WITH CUSTOMERS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Changes in Contract Assets and Contract Liabilities | The following table summarizes the changes in the contract asset and liability balances for the three months ended March 31, 2019 : Contract Asset Contract asset, January 1, 2019 $ 4,193 Transferred to trade receivable of contract asset included in beginning of the year contract asset (4,193 ) Contract asset, net of transferred to trade receivables on contracts during the period 5,848 Contract asset, March 31, 2019 $ 5,848 Contract Liability Contract liability, January 1, 2019 $ 12,716 Recognition of revenue included in beginning of year contract liability (1,165 ) Contract liability, net of revenue recognized on contracts during the period 800 Foreign currency translation 4 Contract liability, March 31, 2019 $ 12,355 |
Schedule of Disaggregation of Revenue | The following table presents revenues disaggregated by the major sources of revenues for the three months ended March 31, 2019 and 2018 (amounts in thousands): Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 (amounts in thousands) Neurosurgery $ 166,415 $ 166,898 Precision Tools and Instruments 68,153 69,217 Total Codman Specialty Surgical 234,568 236,115 Wound Reconstruction and Care 74,963 72,287 Extremity Orthopedics 22,685 22,635 Private Label 27,474 26,045 Total Orthopedics and Tissue Technologies 125,122 120,967 Total revenue $ 359,690 $ 357,082 |
Schedule of Impact on Statement of Operations | The impact of adoption in the year of implementation of Topic 606 to the Company's consolidated statement of operations for the three months ended March 31, 2018 was as follows: Three Months Ended March 31, 2018 As Reported Excluding Impact of Topic 606 (Amounts in thousands) Statement of Operations Total revenue, net $ 357,082 $ 356,622 Cost of goods sold 144,222 144,019 Income tax benefit (1,860 ) (1,924 ) Net income 10,992 10,799 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Inventory, Net [Abstract] | |
Schedule of Inventory, Net | Inventories, net consisted of the following: March 31, 2019 December 31, 2018 (In thousands) Finished goods $ 178,263 $ 179,885 Work in process 52,640 47,715 Raw materials 56,059 52,747 $ 286,962 $ 280,347 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | Changes in the carrying amount of goodwill for the three -month period ended March 31, 2019 were as follows: Codman Specialty Surgical Orthopedics and Tissue Technologies Total (In thousands) Goodwill at December 31, 2018 $ 625,760 $ 300,715 $ 926,475 Foreign currency translation (2,679 ) (1,288 ) (3,967 ) Goodwill at March 31, 2019 $ 623,081 $ 299,427 $ 922,508 |
Schedule of Finite-Lived Intangible Assets | The components of the Company’s identifiable intangible assets were as follows: March 31, 2019 Weighted Average Life Cost Accumulated Amortization Net (Dollars in thousands) Completed technology 19 years $ 852,751 $ (178,506 ) $ 674,245 Customer relationships 13 years 231,111 (110,519 ) 120,592 Trademarks/brand names 28 years 103,820 (25,665 ) 78,155 Codman trade name Indefinite 161,025 — 161,025 Supplier relationships 27 years 34,721 (16,876 ) 17,845 All other 4 years 10,844 (4,076 ) 6,768 $ 1,394,272 $ (335,642 ) $ 1,058,630 December 31, 2018 Weighted Average Life Cost Accumulated Amortization Net (Dollars in thousands) Completed technology 19 years $ 855,679 $ (167,384 ) $ 688,295 Customer relationships 13 years 231,448 (106,859 ) 124,589 Trademarks/brand names 28 years 104,061 (24,764 ) 79,297 Codman trade name Indefinite 162,054 — 162,054 Supplier relationships 27 years 34,721 (16,519 ) 18,202 All other 4 years 10,958 (3,899 ) 7,059 $ 1,398,921 $ (319,425 ) $ 1,079,496 |
Schedule of Indefinite-Lived Intangible Assets | The components of the Company’s identifiable intangible assets were as follows: March 31, 2019 Weighted Average Life Cost Accumulated Amortization Net (Dollars in thousands) Completed technology 19 years $ 852,751 $ (178,506 ) $ 674,245 Customer relationships 13 years 231,111 (110,519 ) 120,592 Trademarks/brand names 28 years 103,820 (25,665 ) 78,155 Codman trade name Indefinite 161,025 — 161,025 Supplier relationships 27 years 34,721 (16,876 ) 17,845 All other 4 years 10,844 (4,076 ) 6,768 $ 1,394,272 $ (335,642 ) $ 1,058,630 December 31, 2018 Weighted Average Life Cost Accumulated Amortization Net (Dollars in thousands) Completed technology 19 years $ 855,679 $ (167,384 ) $ 688,295 Customer relationships 13 years 231,448 (106,859 ) 124,589 Trademarks/brand names 28 years 104,061 (24,764 ) 79,297 Codman trade name Indefinite 162,054 — 162,054 Supplier relationships 27 years 34,721 (16,519 ) 18,202 All other 4 years 10,958 (3,899 ) 7,059 $ 1,398,921 $ (319,425 ) $ 1,079,496 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Maximum Leverage Ratios | In connection with the May 2018 Amendment, the Company’s maximum consolidated total leverage ratio in the financial covenants (as defined in the Senior Credit Facility) was modified to the following: Fiscal Quarter Maximum Consolidated Total Leverage Ratio Execution of May 2018 Amendment through March 31, 2019 5.50 : 1.00 June 30, 2019 through March 31, 2020 5.00 : 1.00 June 30, 2020 through March 31, 2021 4.50 : 1.00 June 30, 2021 and thereafter 4.00 : 1.00 |
Schedule of Maturities of Long-term Debt | Contractual repayments of the Term Loan component of the Senior Credit Facility are due as follows: Year Ended December 31, Principal Repayment (In thousands) Remainder of 2019 $ 22,500 2020 45,000 2021 56,250 2022 67,500 2023 708,750 $ 900,000 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments | The Company held the following cross-currency rate swaps designated as net investment hedges as of March 31, 2019 and December 31, 2018 , respectively (dollar amounts in thousands): March 31, 2019 December 31, 2018 Effective Date Termination Date Fixed Rate Aggregate Notional Amount Fair Value Asset (Liability) Fair Value Asset (Liability) Pay EUR October 3, 2018 September 30, 2021 — EUR 70,738 $ 3,343 $ 1,359 Receive U.S.$ 3.01% $ 82,000 Pay EUR October 3, 2018 September 30, 2023 — EUR 51,760 2,175 (421 ) Receive U.S.$ 2.57% $ 60,000 Pay EUR October 3, 2018 September 30, 2025 — EUR 38,820 1,037 (150 ) Receive U.S.$ 2.19% $ 45,000 Pay GBP October 3, 2018 September 30, 2025 1.67% GBP 128,284 (1,026 ) 2,360 Receive U.S.$ 2.71% $ 167,500 Pay CHF October 3, 2018 September 30, 2025 — CHF 165,172 1,731 (3,780 ) Receive GBP 1.67% GBP 128,284 Total $ 7,260 $ (632 ) The Company held the following interest rate swaps as of March 31, 2019 and December 31, 2018 (amounts in thousands): March 31, 2019 December 31, 2018 Hedged Item Current Notional Amount Designation Date Effective Date Termination Date Fixed Interest Rate Estimated Fair Value Estimated Fair Value Assets (Liabilities) Assets (Liabilities) 3-month USD LIBOR Loan $ 50,000 June 22, 2016 December 31, 2016 June 30, 2019 1.062 % $ 193 $ 410 3-month USD LIBOR Loan 50,000 June 22, 2016 December 31, 2016 June 30, 2019 1.062 % 193 415 1-month USD LIBOR Loan 50,000 July 12, 2016 December 31, 2016 June 30, 2019 0.825 % 210 418 3-month USD LIBOR Loan 50,000 February 6, 2017 June 30, 2017 June 30, 2020 1.834 % 393 619 1-month USD LIBOR Loan 100,000 February 6, 2017 June 30, 2017 June 30, 2020 1.652 % 866 1,287 1-month USD LIBOR Loan 100,000 March 27, 2017 December 31, 2017 June 30, 2021 1.971 % 552 1,246 1-month USD LIBOR Loan 150,000 December 13, 2017 January 1, 2018 December 31, 2022 2.201 % (136 ) 1,491 1-month USD LIBOR Loan 150,000 December 13, 2017 January 1, 2018 December 31, 2022 2.201 % (168 ) 1,460 1-month USD LIBOR Loan 100,000 December 13, 2017 July 1, 2019 June 30, 2024 2.423 % (1,059 ) 418 1-month USD LIBOR Loan 50,000 December 13, 2017 July 1, 2019 June 30, 2024 2.423 % (572 ) 162 1-month USD LIBOR Loan 200,000 December 13, 2017 January 1, 2018 December 31, 2024 2.313 % (1,226 ) 2,076 1-month USD LIBOR Loan 75,000 October 10, 2018 July 1, 2020 June 30, 2025 3.220 % (3,726 ) (2,594 ) 1-month USD LIBOR Loan 75,000 October 10, 2018 July 1, 2020 June 30, 2025 3.199 % (3,698 ) (2,551 ) 1-month USD LIBOR Loan 75,000 October 10, 2018 July 1, 2020 June 30, 2025 3.209 % (3,735 ) (2,568 ) 1-month USD LIBOR Loan 100,000 December 18, 2018 December 30, 2022 December 31, 2027 2.885 % (2,426 ) (797 ) 1-month USD LIBOR Loan 100,000 December 18, 2018 December 30, 2022 December 31, 2027 2.867 % (2,337 ) (873 ) Total interest rate derivatives designated as cash flow hedge $ 1,475,000 $ (16,676 ) $ 619 The Company held the following cross-currency rate swaps as of March 31, 2019 (dollar amounts in thousands): March 31, 2019 Effective Date Termination Date Fixed Rate Aggregate Notional Amount Fair Value Asset (Liability) Pay CHF October 2, 2017 October 2, 2020 1.75% CHF 64,710 $ 1,062 Receive U.S.$ 4.38% $ 66,667 Pay CHF October 2, 2017 October 2, 2021 1.85% CHF 48,533 575 Receive U.S.$ 4.46% $ 50,000 Pay CHF October 2, 2017 October 2, 2022 1.95% CHF 145,598 1,078 Receive U.S.$ 4.52% $ 150,000 Total $ 2,715 |
Schedule of Fair Value and Presentation of Derivatives | The following table summarizes the fair value and presentation for derivatives designated as hedging instruments in the condensed consolidated balance sheets as of March 31, 2019 and December 31, 2018 : Fair Value as of Location on Balance Sheet (1) : March 31, 2019 December 31, 2018 (In thousands) Derivatives designated as hedges — Assets: Prepaid expenses and other current assets Cash Flow Hedges Interest rate swap (2) $ 2,738 $ 4,654 Cross-currency swap 6,849 7,615 Net Investment Hedges Cross-currency swap 8,910 8,888 Other assets Cash Flow Hedges Interest rate swap (2) 346 5,350 Net Investment Hedges Cross-currency swap 1,532 1,774 Total derivatives designated as hedges — Assets $ 20,375 $ 28,281 Derivatives designated as hedges — Liabilities: Accrued expenses and other current liabilities Cash Flow Hedges Interest rate swap (2) $ 87 $ — Other liabilities Cash Flow Hedges Interest rate swap (2) 19,672 9,385 Cross-currency swap 4,134 10,445 Net Investment Hedges Cross-currency swap 3,181 11,294 Total derivatives designated as hedges — Liabilities $ 27,074 $ 31,124 (1) The Company classifies derivative assets and liabilities as non-current based on the cash flows expected to be incurred within the following 12 months. (2) At March 31, 2019 and December 31, 2018 , the notional amount related to the Company’s interest rate swaps were $1.5 billion . |
Effect of Derivative Instruments Designated as Cash Flow Hedges on Statements of Operations | The following presents the effect of derivative instruments designated as cash flow hedges on the accompanying condensed consolidated statement of operations during the three months ended March 31, 2019 and 2018 : Balance in AOCI Beginning of Quarter Amount of Gain (Loss) Recognized in AOCI Amount of Gain (Loss) Reclassified from AOCI into Earnings Balance in AOCI End of Quarter Location in Statements of Operations (In thousands) Three Months Ended March 31, 2019 Cash Flow Hedges Interest rate swap $ 619 $ (15,891 ) $ 1,406 $ (16,678 ) Interest income Cross-currency swap (6,190 ) 7,473 5,178 (3,895 ) Other income, net Net Investment Hedges Cross-currency swap (632 ) 10,221 2,327 7,262 Interest income $ (6,203 ) $ 1,803 $ 8,911 $ (13,311 ) Three Months Ended March 31, 2018 Cash Flow Hedges Interest rate swap $ 592 $ 14,940 $ (656 ) $ 16,188 Interest expense Cross-currency swap (5,104 ) (7,027 ) (4,454 ) (7,677 ) Other income, net $ (4,512 ) $ 7,913 $ (5,110 ) $ 8,511 |
LEASES AND RELATED PARTY LEAS_2
LEASES AND RELATED PARTY LEASES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Supplemental Balance Sheet Information | Supplemental balance sheet information related to operating leases at March 31, 2019 were as follows: March 31, 2019 (In thousands, except lease term and discount rate) ROU assets $ 64,999 Current lease liabilities $ 12,619 Non-current lease liabilities 61,711 Total lease liabilities $ 74,330 Weighted average remaining lease term (in years): Leased facilities 9.9 Leased vehicles 3.4 Weighted average discount rate: Leased facilities 5.7 % Leased vehicles 3.2 % |
Supplemental Cash Flow Information | Supplemental cash flow information related to leases was as follows for the three months ended March 31, 2019 (in thousands): March 31, 2019 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 3,408 ROU assets obtained in exchange for lease liabilities: Operating leases 2,004 |
Future Minimum Lease Payment Obligations Under Operating Leases, After Adoption of 842 | Future minimum lease payments under operating leases at March 31, 2019 were as follows: Related Parties Third Parties Total (In thousands) 2019 $ 222 $ 11,641 $ 11,863 2020 296 12,409 12,705 2021 296 11,532 11,828 2022 296 9,154 9,450 2023 296 7,282 7,578 Thereafter 1,724 40,893 42,617 Total minimum lease payments $ 3,130 $ 92,911 $ 96,041 Less: Imputed interest 21,711 Total lease liabilities 74,330 Less: Current lease liabilities 12,619 Long-term lease liabilities 61,711 |
Future Minimum Lease Payment Obligations Under Operating Leases, Before Adoption of 842 | Future minimum lease payments under operating leases at December 31, 2018 were as follows: Related Parties Third Parties Total (In thousands) 2019 $ 296 $ 16,472 $ 16,768 2020 296 13,510 13,806 2021 296 12,197 12,493 2022 296 12,937 13,233 2023 296 10,707 11,003 Thereafter 1,724 100,675 102,399 Total minimum lease payments $ 3,204 $ 166,498 $ 169,702 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | The following table provides a summary of the Company's effective tax rate: Three Months Ended March 31, 2019 2018 Reported tax rate (32.0 )% (20.4 )% |
NET INCOME PER SHARE (Tables)
NET INCOME PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Net Income Per Share | Basic and diluted net income per share was as follows: Three Months Ended March 31, 2019 2018 (In thousands, except per share amounts) Basic net income per share: Net income $ 32,756 $ 10,992 Weighted average common shares outstanding 85,343 78,552 Basic net income per common share $ 0.38 $ 0.14 Diluted net income per share: Net income $ 32,756 $ 10,992 Weighted average common shares outstanding — Basic 85,343 78,552 Effect of dilutive securities: Stock options and restricted stock 915 1,282 Weighted average common shares for diluted earnings per share 86,258 79,834 Diluted net income per common share $ 0.38 $ 0.14 |
COMPREHENSIVE INCOME (Tables)
COMPREHENSIVE INCOME (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Schedule of Comprehensive Income | Comprehensive income was as follows: Three Months Ended March 31, 2019 2018 (In thousands) Net income $ 32,756 $ 10,992 Foreign currency translation adjustment (7,009 ) 13,780 Change in unrealized gain (loss) on derivatives, net of tax (4,236 ) 7,838 Pension liability adjustment, net of tax 9 (6 ) Comprehensive income, net $ 21,520 $ 32,604 |
Schedule of Changes in Accumulated Other Comprehensive Income by Component | Changes in Accumulated Other Comprehensive Income by component between December 31, 2018 and March 31, 2019 are presented in the table below, net of tax: Gains and Losses on Derivatives Defined Benefit Pension Items Foreign Currency Items Total (In thousands) Balance at January 1, 2019 $ (4,813 ) $ (736 ) $ (39,894 ) $ (45,443 ) Other comprehensive income (loss) 2,516 9 (7,009 ) (4,484 ) Less: Amounts reclassified from accumulated other comprehensive income 6,752 — — 6,752 Net current-period other comprehensive income (loss) (4,236 ) 9 (7,009 ) (11,236 ) Balance at March 31, 2019 $ (9,049 ) $ (727 ) $ (46,903 ) $ (56,679 ) |
SEGMENT AND GEOGRAPHIC INFORM_2
SEGMENT AND GEOGRAPHIC INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Total Revenue By Major Geographic Area | Net sales and profit by each reportable segment for the three months ended March 31, 2019 and 2018 are as follows: Three Months Ended March 31, 2019 2018 (In thousands) Segment Net Sales Codman Specialty Surgical $ 234,568 $ 236,115 Orthopedics and Tissue Technologies 125,122 120,967 Total revenues $ 359,690 $ 357,082 Segment Profit Codman Specialty Surgical $ 91,380 $ 89,491 Orthopedics and Tissue Technologies 40,495 32,438 Segment profit 131,875 121,929 Amortization (5,279 ) (5,390) Corporate and other (94,288 ) (90,960 ) Operating income $ 32,308 $ 25,579 The Company does not allocate any assets to the reportable segments. No asset information is reported to the chief operating decision maker and disclosed in the financial information for each segment. The Company attributes revenues to geographic areas based on the location of the customer. Total revenue by major geographic area consisted of the following: Three Months Ended March 31, 2019 2018 (In thousands) United States $ 256,726 $ 248,928 Europe 48,640 51,773 Asia Pacific 35,700 35,785 Rest of World 18,624 20,596 Total Revenues $ 359,690 $ 357,082 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Contingent Consideration | A reconciliation of the opening balances to the closing balances of these Level 3 measurements for the three months ended March 31, 2019 and 2018 is as follows (in thousands): Three Months Ended March 31, 2019 Contingent Consideration Liability Related to Acquisition of Derma Long-term Balance as of January 1, 2019 $ 230 Balance as of March 31, 2019 $ 230 Three Months Ended March 31, 2018 Contingent Considerations Liabilities Related to Acquisition of Derma Contingent Consideration Liability Related to Acquisition of Confluent Surgical, Inc. Location in Financial Statements Short-term Long-term Short-term Balance as of January 1, 2018 $ 315 $ 1,387 $ 22,478 Loss from change in fair value of contingent consideration liabilities — 32 1,422 Selling, general and administrative Balance as of March 31, 2018 $ 315 $ 1,419 $ 23,900 |
BASIS OF PRESENTATION - Narrati
BASIS OF PRESENTATION - Narrative (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 |
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Lease liabilities | $ 74,330 | |
ROU assets | $ 64,999 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Lease liabilities | $ 76,400 | |
ROU assets | $ 67,300 |
BUSINESS DEVELOPMENT - Narrativ
BUSINESS DEVELOPMENT - Narrative (Details) - ISC - Licensing Agreements | Jan. 04, 2019USD ($) |
Schedule Of Asset Acquisition [Line Items] | |
Upfront payment | $ 1,700,000 |
Option to acquire, period subsequent to commercial sale | 4 years |
Maximum future purchase price, if circumstances met (not to exceed) | $ 80,000,000 |
Number of assets acquired | 1 |
REVENUES FROM CONTRACTS WITH _3
REVENUES FROM CONTRACTS WITH CUSTOMERS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2018 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Number of days from shipment to issue a credit | 90 days | ||
Short-term portion of contract liability | $ 3,750 | $ 3,764 | |
Long-term portion of contract liability | $ 8,600 | ||
Product warranty period (up to) | 2 years | ||
Increase to opening retained earnings | $ 381,129 | 348,373 | |
Increase to total assets | 3,205,711 | 3,107,887 | |
Increase to total liabilities | $ 1,808,681 | $ 1,732,091 | |
Accounting Standards Update 2014-09 | Adjustment Resulting from Adoption of Topic 606 | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Increase to total assets | $ 7,100 | ||
Increase to total liabilities | 5,200 | ||
Accounting Standards Update 2014-09 | Adjustment Resulting from Adoption of Topic 606 | Transferred over Time | Private Label | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Increase to opening retained earnings | $ 1,900 | ||
Minimum | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Manufacturing period for products shipped with no alternative use and right of payment for performance | 1 month | ||
Maximum | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Manufacturing period for products shipped with no alternative use and right of payment for performance | 3 months |
REVENUES FROM CONTRACTS WITH _4
REVENUES FROM CONTRACTS WITH CUSTOMERS - Narrative, Revenue Remaining Performance Obligation (Details) $ in Millions | Mar. 31, 2019USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations expected to be satisfied | $ 3 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations expected to be satisfied | $ 2.9 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations expected to be satisfied, expected timing | 9 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations expected to be satisfied | $ 2.2 |
Performance obligations expected to be satisfied, expected timing | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations expected to be satisfied | $ 1.3 |
Performance obligations expected to be satisfied, expected timing | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations expected to be satisfied | $ 0.8 |
Performance obligations expected to be satisfied, expected timing | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations expected to be satisfied | $ 2.2 |
Performance obligations expected to be satisfied, expected timing |
REVENUES FROM CONTRACTS WITH _5
REVENUES FROM CONTRACTS WITH CUSTOMERS - Schedule of Changes in Contract Assets and Liabilities (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Contract Asset | |
Contract asset, Beginning of period | $ 4,193 |
Transferred to trade receivable of contract asset included in beginning of the year contract asset | (4,193) |
Contract asset, net of transferred to trade receivables on contracts during the period | 5,848 |
Contract asset, End of Period | 5,848 |
Contract Liability | |
Contract liability, Beginning of Period | 12,716 |
Recognition of revenue included in beginning of year contract liability | (1,165) |
Contract liability, net of revenue recognized on contracts during the period | 800 |
Foreign currency translation | 4 |
Contract liability, End of Period | $ 12,355 |
REVENUES FROM CONTRACTS WITH _6
REVENUES FROM CONTRACTS WITH CUSTOMERS - Schedule of Revenues Disaggregated by Major Source (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Total Revenues | $ 359,690 | $ 357,082 |
Codman Specialty Surgical | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | 234,568 | 236,115 |
Codman Specialty Surgical | Neurosurgery | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | 166,415 | 166,898 |
Codman Specialty Surgical | Precision Tools and Instruments | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | 68,153 | 69,217 |
Orthopedics and Tissue Technologies | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | 125,122 | 120,967 |
Orthopedics and Tissue Technologies | Wound Reconstruction and Care | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | 74,963 | 72,287 |
Orthopedics and Tissue Technologies | Extremity Orthopedics | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | 22,685 | 22,635 |
Orthopedics and Tissue Technologies | Private Label | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenues | $ 27,474 | $ 26,045 |
REVENUES FROM CONTRACTS WITH _7
REVENUES FROM CONTRACTS WITH CUSTOMERS - Impact of Adoption on Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Operations | ||
Total revenue, net | $ 359,690 | $ 357,082 |
Cost of goods sold | 128,912 | 144,222 |
Income tax benefit | (7,933) | (1,860) |
Net income | $ 32,756 | 10,992 |
Excluding Impact of Topic 606 | ||
Statement of Operations | ||
Total revenue, net | 356,622 | |
Cost of goods sold | 144,019 | |
Income tax benefit | (1,924) | |
Net income | $ 10,799 |
INVENTORIES - Schedule of Net I
INVENTORIES - Schedule of Net Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Inventory, Net [Abstract] | ||
Finished goods | $ 178,263 | $ 179,885 |
Work in process | 52,640 | 47,715 |
Raw materials | 56,059 | 52,747 |
Inventories, net | $ 286,962 | $ 280,347 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Schedule of Changes in Carrying Amount of Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Goodwill [Roll Forward] | |
Beginning of Period | $ 926,475 |
Foreign currency translation | (3,967) |
End of Period | 922,508 |
Codman Specialty Surgical | |
Goodwill [Roll Forward] | |
Beginning of Period | 625,760 |
Foreign currency translation | (2,679) |
End of Period | 623,081 |
Orthopedics and Tissue Technologies | |
Goodwill [Roll Forward] | |
Beginning of Period | 300,715 |
Foreign currency translation | (1,288) |
End of Period | $ 299,427 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Components of Company's Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Cost | $ 1,394,272 | $ 1,398,921 | |
Accumulated Amortization | (335,642) | (319,425) | |
Net | 1,058,630 | 1,079,496 | |
Codman trade name | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Cost | 161,025 | 162,054 | |
Net | $ 161,025 | 162,054 | |
Completed technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Life | 19 years | 19 years | |
Cost | $ 852,751 | 855,679 | |
Accumulated Amortization | (178,506) | (167,384) | |
Net | $ 674,245 | 688,295 | |
Customer relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Life | 13 years | 13 years | |
Cost | $ 231,111 | 231,448 | |
Accumulated Amortization | (110,519) | (106,859) | |
Net | $ 120,592 | 124,589 | |
Trademarks/brand names | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Life | 28 years | 28 years | |
Cost | $ 103,820 | 104,061 | |
Accumulated Amortization | (25,665) | (24,764) | |
Net | $ 78,155 | 79,297 | |
Supplier relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Life | 27 years | 27 years | |
Cost | $ 34,721 | 34,721 | |
Accumulated Amortization | (16,876) | (16,519) | |
Net | $ 17,845 | 18,202 | |
All other | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Life | 4 years | 4 years | |
Cost | $ 10,844 | 10,958 | |
Accumulated Amortization | (4,076) | (3,899) | |
Net | $ 6,768 | $ 7,059 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Goodwill [Line Items] | |||
Expected annual amortization expense, 2019 | $ 49,500 | ||
Expected annual amortization expense, 2020 | 65,800 | ||
Expected annual amortization expense, 2021 | 64,700 | ||
Expected annual amortization expense, 2022 | 61,200 | ||
Expected annual amortization expense, 2023 | 60,300 | ||
Expected annual amortization expense, 2024 | 59,500 | ||
Expected annual amortization expense, thereafter | 535,900 | ||
Total revenue, net | 359,690 | $ 357,082 | |
Acquired intangible asset associated with customer received notification from the FDA | 1,058,630 | $ 1,079,496 | |
Customer Relationships | |||
Goodwill [Line Items] | |||
Acquired intangible asset associated with customer received notification from the FDA | 120,592 | 124,589 | |
Contract Manufacturing Customer, Notified By FDA To Remove Product From Market | Private Label | |||
Goodwill [Line Items] | |||
Total revenue, net | 600 | $ 1,700 | |
Contract Manufacturing Customer, Notified By FDA To Remove Product From Market | Customer Relationships | Private Label | |||
Goodwill [Line Items] | |||
Acquired intangible asset associated with customer received notification from the FDA | $ 5,900 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | May 03, 2018 | |
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 2,200,000,000 | |||
Previously capitalized financing costs, written-off | $ 800,000 | |||
Securitization program outstanding borrowings, maximum limit | $ 150,000,000 | |||
Securitization program, term | 3 years | |||
Long-term borrowings under securitization facility | $ 126,000,000 | $ 121,200,000 | ||
Weighted average interest rate, accounts receivable securitization revolving loan facility | 3.50% | |||
Fair Value, Inputs, Level 2 | ||||
Debt Instrument [Line Items] | ||||
Securitization facility, outstanding borrowings, fair value | $ 124,600,000 | |||
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | 1,300,000,000 | |||
Line of credit facility outstanding | $ 350,000,000 | $ 345,000,000 | ||
Weighted average interest rate on debt | 3.90% | 4.00% | ||
Revolving Credit Facility | Fair Value, Inputs, Level 2 | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, fair value of amount outstanding | $ 340,900,000 | |||
Standby Letters of Credit | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | 60,000,000 | |||
Swingline Loans | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | 60,000,000 | |||
Term Loan Facility | Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 900,000,000 | |||
Term Loan Facility | Secured Debt | Fair Value, Inputs, Level 2 | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, fair value of amount outstanding | $ 885,300,000 | |||
Senior Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Incremental financing costs capitalized | $ 4,200,000 | |||
Senior Credit Facility | Federal Funds | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 0.50% | |||
Senior Credit Facility | One Month Eurodollar Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 1.00% | |||
Senior Credit Facility | Minimum | ||||
Debt Instrument [Line Items] | ||||
Line of credit, commitment fee percentage | 0.15% | |||
Senior Credit Facility | Minimum | Eurodollar | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 1.00% | |||
Senior Credit Facility | Minimum | Federal Funds | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 0.00% | |||
Senior Credit Facility | Minimum | Prime Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 0.00% | |||
Senior Credit Facility | Minimum | One Month Eurodollar Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 0.00% | |||
Senior Credit Facility | Maximum | ||||
Debt Instrument [Line Items] | ||||
Line of credit, commitment fee percentage | 0.30% | |||
Senior Credit Facility | Maximum | Eurodollar | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 1.75% | |||
Senior Credit Facility | Maximum | Federal Funds | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 0.75% | |||
Senior Credit Facility | Maximum | Prime Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 0.75% | |||
Senior Credit Facility | Maximum | One Month Eurodollar Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rates available to the Company at its option | 0.75% | |||
Senior Credit Facility | Standby Letters of Credit | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility outstanding | $ 0 | |||
Letters of credit outstanding | 600,000 | $ 600,000 | ||
Term Loan A | Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility outstanding | $ 900,000,000 | $ 900,000,000 | ||
Weighted average interest rate on debt | 3.90% | 3.90% | ||
Term Loan A | Secured Debt | Secured Debt, Current | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility outstanding | $ 33,800,000 |
DEBT - Maximum Total Leverage R
DEBT - Maximum Total Leverage Ratio Table (Details) - Senior Credit Facility | Mar. 31, 2019 |
Execution of May 2018 Amendment through March 31, 2019 | |
Debt Instrument [Line Items] | |
Maximum Consolidated Total Leverage Ratio | 5.50 |
June 30, 2019 through March 31, 2020 | |
Debt Instrument [Line Items] | |
Maximum Consolidated Total Leverage Ratio | 5 |
June 30, 2020 through March 31, 2021 | |
Debt Instrument [Line Items] | |
Maximum Consolidated Total Leverage Ratio | 4.50 |
June 30, 2021 and thereafter | |
Debt Instrument [Line Items] | |
Maximum Consolidated Total Leverage Ratio | 4 |
DEBT - Contractual Maturity Tab
DEBT - Contractual Maturity Table (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Debt Disclosure [Abstract] | |
Remainder of 2019 | $ 22,500 |
2020 | 45,000 |
2021 | 56,250 |
2022 | 67,500 |
2023 | 708,750 |
Principal Repayment | $ 900,000 |
DERIVATIVE INSTRUMENTS - Schedu
DERIVATIVE INSTRUMENTS - Schedule of Derivatives (Details) - Cash Flow Hedges - Designated as Hedging Instrument - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Derivative [Line Items] | ||
Current Notional Amount | $ 1,475,000,000 | |
Estimated Fair Value, Assets (Liabilities) | (16,676,000) | $ 619,000 |
3-Month USD LIBOR | Interest Rate Swap Designated June 22, 2016 Tranche 1 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 50,000,000 | |
Fixed Interest Rate | 1.062% | |
Estimated Fair Value, Assets (Liabilities) | $ 193,000 | 410,000 |
3-Month USD LIBOR | Interest Rate Swap Designated June 22, 2016 Tranche 2 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 50,000,000 | |
Fixed Interest Rate | 1.062% | |
Estimated Fair Value, Assets (Liabilities) | $ 193,000 | 415,000 |
3-Month USD LIBOR | Interest Rate Swap Designated February 6, 2017 Tranche 1 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 50,000,000 | |
Fixed Interest Rate | 1.834% | |
Estimated Fair Value, Assets (Liabilities) | $ 393,000 | 619,000 |
1-Month USD LIBOR | Interest Rate Swap Designated July 12, 2016 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 50,000,000 | |
Fixed Interest Rate | 0.825% | |
Estimated Fair Value, Assets (Liabilities) | $ 210,000 | 418,000 |
1-Month USD LIBOR | Interest Rate Swap Designated February 6, 2017 Tranche 2 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 100,000,000 | |
Fixed Interest Rate | 1.652% | |
Estimated Fair Value, Assets (Liabilities) | $ 866,000 | 1,287,000 |
1-Month USD LIBOR | Interest Rate Swap Designated March 27, 2017 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 100,000,000 | |
Fixed Interest Rate | 1.971% | |
Estimated Fair Value, Assets (Liabilities) | $ 552,000 | 1,246,000 |
1-Month USD LIBOR | Interest Rate Swap Designated December 13, 2017 Tranche 1 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 150,000,000 | |
Fixed Interest Rate | 2.201% | |
Estimated Fair Value, Assets (Liabilities) | $ (136,000) | 1,491,000 |
1-Month USD LIBOR | Interest Rate Swap Designated December 13, 2017 Tranche 2 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 150,000,000 | |
Fixed Interest Rate | 2.201% | |
Estimated Fair Value, Assets (Liabilities) | $ (168,000) | 1,460,000 |
1-Month USD LIBOR | Interest Rate Swap Designated December 13, 2017 Tranche 3 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 100,000,000 | |
Fixed Interest Rate | 2.423% | |
Estimated Fair Value, Assets (Liabilities) | $ (1,059,000) | 418,000 |
1-Month USD LIBOR | Interest Rate Swap Designated December 13, 2017 Tranche 4 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 50,000,000 | |
Fixed Interest Rate | 2.423% | |
Estimated Fair Value, Assets (Liabilities) | $ (572,000) | 162,000 |
1-Month USD LIBOR | Interest Rate Swap Designated December 13, 2017 Tranche 5 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 200,000,000 | |
Fixed Interest Rate | 2.313% | |
Estimated Fair Value, Assets (Liabilities) | $ (1,226,000) | 2,076,000 |
1-Month USD LIBOR | Interest Rate Swap Designated October 10, 2018 Tranche 1 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 75,000,000 | |
Fixed Interest Rate | 3.22% | |
Estimated Fair Value, Assets (Liabilities) | $ (3,726,000) | (2,594,000) |
1-Month USD LIBOR | Interest Rate Swap Designated October 10, 2018 Tranche 2 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 75,000,000 | |
Fixed Interest Rate | 3.199% | |
Estimated Fair Value, Assets (Liabilities) | $ (3,698,000) | (2,551,000) |
1-Month USD LIBOR | Interest Rate Swap Designated October 10, 2018 Tranche 3 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 75,000,000 | |
Fixed Interest Rate | 3.209% | |
Estimated Fair Value, Assets (Liabilities) | $ (3,735,000) | (2,568,000) |
1-Month USD LIBOR | Interest Rate Swap Designated December 18, 2018 Tranche 1 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 100,000,000 | |
Fixed Interest Rate | 2.885% | |
Estimated Fair Value, Assets (Liabilities) | $ (2,426,000) | (797,000) |
1-Month USD LIBOR | Interest Rate Swap Designated December 18, 2018 Tranche 2 | ||
Derivative [Line Items] | ||
Current Notional Amount | $ 100,000,000 | |
Fixed Interest Rate | 2.867% | |
Estimated Fair Value, Assets (Liabilities) | $ (2,337,000) | $ (873,000) |
DERIVATIVE INSTRUMENTS - Narrat
DERIVATIVE INSTRUMENTS - Narrative (Details) | 3 Months Ended | ||||
Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Oct. 02, 2017CHF (SFr) | Oct. 02, 2017USD ($) | |
Designated as Hedging Instrument | Cash Flow Hedges | |||||
Derivative [Line Items] | |||||
Notional amount | $ 1,475,000,000 | ||||
Interest Rate Swap | |||||
Derivative [Line Items] | |||||
Notional amount | 1,500,000,000 | $ 1,500,000,000 | |||
Cross-currency swap | Codman | |||||
Derivative [Line Items] | |||||
Gain (loss), reclassification from AOCI, foreign currency rate translation, intercompany loan | 3,300,000 | $ (6,400,000) | |||
Gain reclassified into other income | 1,900,000 | 1,900,000 | |||
Pre-tax income recorded in AOCI related to cash flow hedges to be reclassified to earnings in the next twelve months | 6,800,000 | ||||
Cross-currency swap | Codman | Other income, net | |||||
Derivative [Line Items] | |||||
Gain (loss) recorded to AOCI | 5,500,000 | $ (7,000,000) | |||
Cross-currency swap | Short | Codman | |||||
Derivative [Line Items] | |||||
Notional amount | $ 300,000,000 | ||||
Cross-currency swap | Long | Codman | |||||
Derivative [Line Items] | |||||
Notional amount | SFr | SFr 291,200,000 | ||||
Cross-currency swap | Designated as Hedging Instrument | |||||
Derivative [Line Items] | |||||
Gain recorded in AOCI, change in fair value | 7,900,000 | ||||
Cross-currency swap | Designated as Hedging Instrument | Net Investment Hedges | |||||
Derivative [Line Items] | |||||
Gain reclassified into other income | 2,300,000 | ||||
Pre-tax income recorded in AOCI related to cash flow hedges to be reclassified to earnings in the next twelve months | 8,900,000 | ||||
Cross-currency swap | Designated as Hedging Instrument | Codman | Cash Flow Hedges | |||||
Derivative [Line Items] | |||||
Notional amount | 33,300,000 | ||||
Loss recorded in other income, net | $ 400,000 |
DERIVATIVE INSTRUMENTS - Sche_2
DERIVATIVE INSTRUMENTS - Schedule of Cross Currency Swap Derivatives (Details) | Mar. 31, 2019CHF (SFr) | Mar. 31, 2019USD ($) | Dec. 31, 2018CHF (SFr) | Dec. 31, 2018USD ($) | Oct. 02, 2017CHF (SFr) | Oct. 02, 2017USD ($) |
Codman | Cross-currency swap | Long | ||||||
Derivative [Line Items] | ||||||
Aggregate Notional Amount | SFr | SFr 291,200,000 | |||||
Codman | Cross-currency swap | Short | ||||||
Derivative [Line Items] | ||||||
Aggregate Notional Amount | $ 300,000,000 | |||||
Cash Flow Hedges | Designated as Hedging Instrument | ||||||
Derivative [Line Items] | ||||||
Aggregate Notional Amount | $ 1,475,000,000 | |||||
Fair Value Asset (Liability) | (16,676,000) | $ 619,000 | ||||
Cash Flow Hedges | Designated as Hedging Instrument | Codman | Cross-currency swap | ||||||
Derivative [Line Items] | ||||||
Aggregate Notional Amount | 33,300,000 | |||||
Fair Value Asset (Liability) | 2,715,000 | (2,830,000) | ||||
Cash Flow Hedges | Swap One | Designated as Hedging Instrument | Codman | Cross-currency swap | ||||||
Derivative [Line Items] | ||||||
Fair Value Asset (Liability) | $ 1,062,000 | $ (215,000) | ||||
Cash Flow Hedges | Swap One | Designated as Hedging Instrument | Codman | Cross-currency swap | Long | ||||||
Derivative [Line Items] | ||||||
Fixed Rate | 1.75% | 1.75% | 1.75% | 1.75% | ||
Aggregate Notional Amount | SFr | SFr 64,710,000 | SFr 97,065,000 | ||||
Cash Flow Hedges | Swap One | Designated as Hedging Instrument | Codman | Cross-currency swap | Short | ||||||
Derivative [Line Items] | ||||||
Fixed Rate | 4.38% | 4.38% | 4.38% | 4.38% | ||
Aggregate Notional Amount | $ 66,667,000 | $ 100,000,000 | ||||
Cash Flow Hedges | Swap Two | Designated as Hedging Instrument | Codman | Cross-currency swap | ||||||
Derivative [Line Items] | ||||||
Fair Value Asset (Liability) | $ 575,000 | $ (422,000) | ||||
Cash Flow Hedges | Swap Two | Designated as Hedging Instrument | Codman | Cross-currency swap | Long | ||||||
Derivative [Line Items] | ||||||
Fixed Rate | 1.85% | 1.85% | 1.85% | 1.85% | ||
Aggregate Notional Amount | SFr | SFr 48,533,000 | SFr 48,533,000 | ||||
Cash Flow Hedges | Swap Two | Designated as Hedging Instrument | Codman | Cross-currency swap | Short | ||||||
Derivative [Line Items] | ||||||
Fixed Rate | 4.46% | 4.46% | 4.46% | 4.46% | ||
Aggregate Notional Amount | $ 50,000,000 | $ 50,000,000 | ||||
Cash Flow Hedges | Swap Three | Designated as Hedging Instrument | Codman | Cross-currency swap | ||||||
Derivative [Line Items] | ||||||
Fair Value Asset (Liability) | $ 1,078,000 | $ (2,193,000) | ||||
Cash Flow Hedges | Swap Three | Designated as Hedging Instrument | Codman | Cross-currency swap | Long | ||||||
Derivative [Line Items] | ||||||
Fixed Rate | 1.95% | 1.95% | 1.95% | 1.95% | ||
Aggregate Notional Amount | SFr | SFr 145,598,000 | SFr 145,598,000 | ||||
Cash Flow Hedges | Swap Three | Designated as Hedging Instrument | Codman | Cross-currency swap | Short | ||||||
Derivative [Line Items] | ||||||
Fixed Rate | 4.52% | 4.52% | 4.52% | 4.52% | ||
Aggregate Notional Amount | $ 150,000,000 | $ 150,000,000 |
DERIVATIVE INSTRUMENTS - Sche_3
DERIVATIVE INSTRUMENTS - Schedule of Net Investment Hedges Derivatives (Details) - Designated as Hedging Instrument - Net Investment Hedges € in Thousands, £ in Thousands, SFr in Thousands, $ in Thousands | Mar. 31, 2019GBP (£) | Mar. 31, 2019CHF (SFr) | Mar. 31, 2019EUR (€) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Cross Currency Interest Rate Swap One | |||||
Derivative [Line Items] | |||||
Fair Value Asset (Liability) | $ 3,343 | $ 1,359 | |||
Cross Currency Interest Rate Swap One | Long | |||||
Derivative [Line Items] | |||||
Fixed Rate | 0.00% | 0.00% | 0.00% | 0.00% | |
Aggregate Notional Amount | € | € 70,738 | ||||
Cross Currency Interest Rate Swap One | Short | |||||
Derivative [Line Items] | |||||
Fixed Rate | 3.01% | 3.01% | 3.01% | 3.01% | |
Aggregate Notional Amount | $ 82,000 | ||||
Cross Currency Interest Rate Swap Two | |||||
Derivative [Line Items] | |||||
Fair Value Asset (Liability) | $ 2,175 | (421) | |||
Cross Currency Interest Rate Swap Two | Long | |||||
Derivative [Line Items] | |||||
Fixed Rate | 0.00% | 0.00% | 0.00% | 0.00% | |
Aggregate Notional Amount | € | € 51,760 | ||||
Cross Currency Interest Rate Swap Two | Short | |||||
Derivative [Line Items] | |||||
Fixed Rate | 2.57% | 2.57% | 2.57% | 2.57% | |
Aggregate Notional Amount | $ 60,000 | ||||
Cross Currency Interest Rate Swap Three | |||||
Derivative [Line Items] | |||||
Fair Value Asset (Liability) | $ 1,037 | (150) | |||
Cross Currency Interest Rate Swap Three | Long | |||||
Derivative [Line Items] | |||||
Fixed Rate | 0.00% | 0.00% | 0.00% | 0.00% | |
Aggregate Notional Amount | € | € 38,820 | ||||
Cross Currency Interest Rate Swap Three | Short | |||||
Derivative [Line Items] | |||||
Fixed Rate | 2.19% | 2.19% | 2.19% | 2.19% | |
Aggregate Notional Amount | $ 45,000 | ||||
Cross Currency Interest Rate Swap Four | |||||
Derivative [Line Items] | |||||
Fair Value Asset (Liability) | $ (1,026) | 2,360 | |||
Cross Currency Interest Rate Swap Four | Long | |||||
Derivative [Line Items] | |||||
Fixed Rate | 1.67% | 1.67% | 1.67% | 1.67% | |
Aggregate Notional Amount | £ | £ 128,284 | ||||
Cross Currency Interest Rate Swap Four | Short | |||||
Derivative [Line Items] | |||||
Fixed Rate | 2.71% | 2.71% | 2.71% | 2.71% | |
Aggregate Notional Amount | $ 167,500 | ||||
Cross Currency Interest Rate Swap Five | |||||
Derivative [Line Items] | |||||
Fair Value Asset (Liability) | $ 1,731 | (3,780) | |||
Cross Currency Interest Rate Swap Five | Long | |||||
Derivative [Line Items] | |||||
Fixed Rate | 0.00% | 0.00% | 0.00% | 0.00% | |
Aggregate Notional Amount | SFr | SFr 165,172 | ||||
Cross Currency Interest Rate Swap Five | Short | |||||
Derivative [Line Items] | |||||
Fixed Rate | 1.67% | 1.67% | 1.67% | 1.67% | |
Aggregate Notional Amount | £ | £ 128,284 | ||||
Cross Currency Interest Rate Swap | |||||
Derivative [Line Items] | |||||
Fair Value Asset (Liability) | $ 7,260 | $ (632) |
DERIVATIVE INSTRUMENTS - Fair V
DERIVATIVE INSTRUMENTS - Fair Value of Derivative Instruments By Balance Sheet Location (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Assets | $ 20,375,000 | $ 28,281,000 |
Derivatives designated as hedges — Liabilities | 27,074,000 | 31,124,000 |
Interest Rate Swap | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount | 1,500,000,000 | 1,500,000,000 |
Interest Rate Swap | Designated as Hedging Instrument | Prepaid expenses and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Assets | 2,738,000 | 4,654,000 |
Interest Rate Swap | Designated as Hedging Instrument | Other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Assets | 346,000 | 5,350,000 |
Interest Rate Swap | Designated as Hedging Instrument | Accrued expenses and other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Liabilities | 87,000 | 0 |
Interest Rate Swap | Designated as Hedging Instrument | Other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Liabilities | 19,672,000 | 9,385,000 |
Cross-currency swap | Designated as Hedging Instrument | Prepaid expenses and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Assets | 6,849,000 | 7,615,000 |
Cross-currency swap | Designated as Hedging Instrument | Other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Liabilities | 4,134,000 | 10,445,000 |
Cross-currency swap | Net Investment Hedges | Designated as Hedging Instrument | Prepaid expenses and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Assets | 8,910,000 | 8,888,000 |
Cross-currency swap | Net Investment Hedges | Designated as Hedging Instrument | Other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Assets | 1,532,000 | 1,774,000 |
Cross-currency swap | Net Investment Hedges | Designated as Hedging Instrument | Other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedges — Liabilities | $ 3,181,000 | $ 11,294,000 |
DERIVATIVE INSTRUMENTS - Effect
DERIVATIVE INSTRUMENTS - Effect of Derivative Instruments Designated Cash Flow Hedges on Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Derivative Instruments, Gain (Loss) [Roll Forward] | ||
Balance, Beginning of Period | $ 1,375,796 | $ 962,306 |
Balance, End of Period | 1,397,030 | 998,440 |
Accumulated Other Comprehensive Income (Loss) | ||
Derivative Instruments, Gain (Loss) [Roll Forward] | ||
Balance, Beginning of Period | (45,443) | (23,807) |
Balance, End of Period | (56,679) | (1,663) |
Designated as Hedging Instrument | ||
Derivative Instruments, Gain (Loss) [Roll Forward] | ||
Amount of Gain (Loss) Recognized in AOCI | 1,803 | 7,913 |
Amount of Gain (Loss) Reclassified from AOCI into Earnings | 8,911 | (5,110) |
Designated as Hedging Instrument | Accumulated Other Comprehensive Income (Loss) | ||
Derivative Instruments, Gain (Loss) [Roll Forward] | ||
Balance, Beginning of Period | (6,203) | (4,512) |
Balance, End of Period | (13,311) | 8,511 |
Designated as Hedging Instrument | Interest rate swap | Cash Flow Hedges | Interest income | ||
Derivative Instruments, Gain (Loss) [Roll Forward] | ||
Balance, Beginning of Period | 619 | |
Amount of Gain (Loss) Recognized in AOCI | (15,891) | |
Amount of Gain (Loss) Reclassified from AOCI into Earnings | 1,406 | |
Balance, End of Period | (16,678) | |
Designated as Hedging Instrument | Interest rate swap | Cash Flow Hedges | Interest expense | ||
Derivative Instruments, Gain (Loss) [Roll Forward] | ||
Balance, Beginning of Period | 592 | |
Amount of Gain (Loss) Recognized in AOCI | 14,940 | |
Amount of Gain (Loss) Reclassified from AOCI into Earnings | (656) | |
Balance, End of Period | 16,188 | |
Designated as Hedging Instrument | Cross-currency swap | Cash Flow Hedges | Other income, net | ||
Derivative Instruments, Gain (Loss) [Roll Forward] | ||
Balance, Beginning of Period | (6,190) | (5,104) |
Amount of Gain (Loss) Recognized in AOCI | 7,473 | (7,027) |
Amount of Gain (Loss) Reclassified from AOCI into Earnings | 5,178 | (4,454) |
Balance, End of Period | (3,895) | $ (7,677) |
Designated as Hedging Instrument | Cross-currency swap | Net Investment Hedges | Interest income | ||
Derivative Instruments, Gain (Loss) [Roll Forward] | ||
Balance, Beginning of Period | (632) | |
Amount of Gain (Loss) Recognized in AOCI | 10,221 | |
Amount of Gain (Loss) Reclassified from AOCI into Earnings | 2,327 | |
Balance, End of Period | $ 7,262 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($)plan$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share-based compensation arrangement by share-based payment award, number of plans | plan | 2 |
Grants in period, net of forfeitures (in shares) | shares | 202,752 |
Options, weighted average grant date fair value (in dollars per share) | $ / shares | $ 18.74 |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total unrecognized compensation costs | $ | $ 7 |
Weighted-average period for cost recognition (over) | 3 years |
Stock options | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options exercisable, vesting period | 4 years |
Stock options | Directors | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options exercisable, vesting period | 1 year |
Stock options | Employees | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expiration period | 8 years |
Stock options | Directors and Certain Executive Officers | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expiration period | 6 years |
Stock options | Directors and Certain Executive Officers | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expiration period | 10 years |
Performance stock and Restricted stock awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Requisite service periods of awards | 3 years |
Restricted stock awards/stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options exercisable, vesting period | 3 years |
Total unrecognized compensation costs | $ | $ 33.6 |
Weighted-average period for cost recognition (over) | 2 years |
Awards granted during the period (in shares) | shares | 215,662 |
Other than options, weighted average grant date fair value (in dollars per share) | $ / shares | $ 55.62 |
Performance shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Awards granted during the period (in shares) | shares | 118,903 |
Other than options, weighted average grant date fair value (in dollars per share) | $ / shares | $ 55.91 |
DEFINED BENEFIT PLANS - Narrati
DEFINED BENEFIT PLANS - Narrative (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |||
Net periodic benefit costs | $ 500,000 | $ 600,000 | |
Service cost component | 700,000 | $ 700,000 | |
Expected future employer contributions, next fiscal year | $ 1,900,000 | ||
Employer contributions | 0 | ||
Expected additional employer contributions | 1,900,000 | ||
Estimated fair value of plan assets | $ 30,100,000 | $ 31,100,000 |
LEASES AND RELATED PARTY LEAS_3
LEASES AND RELATED PARTY LEASES - Narrative (Details) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2019USD ($)renewal_option | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Jun. 30, 2019USD ($) | |
Operating Leased Assets [Line Items] | ||||
Number of renewal options (or more) | renewal_option | 1 | |||
Operating lease expense | $ 4,400,000 | $ 3,400,000 | ||
Total payments over lease term, new operating lease | 96,041,000 | |||
Operating lease expense, Topic 840 | $ 16,300,000 | |||
Capital Leases, Future Minimum Payments Due | 0 | |||
Scenario, Forecast | NEW JERSEY | ||||
Operating Leased Assets [Line Items] | ||||
Total payments over lease term, new operating lease | $ 67,000,000 | |||
Related Parties | ||||
Operating Leased Assets [Line Items] | ||||
Operating lease expense | 100,000 | $ 100,000 | ||
Total payments over lease term, new operating lease | $ 3,130,000 | |||
Operating lease expense, Topic 840 | $ 300,000 | |||
Percent of manufacturing facility owned by corporation whose shareholders are trusts whose beneficiaries include family members of company's former director | 50.00% | |||
Annual rate of lease agreement | $ 300,000 | |||
Related Parties | Five Year Option Lease From November 1, 2032 Through October 31, 2037 | ||||
Operating Leased Assets [Line Items] | ||||
Option to extend lease, years | 5 years | |||
Period for extended lease | November 1, 2032 through October 31, 2037 | |||
Related Parties | Five Year Option Lease From November 1, 2037 Through October 31, 2042 | ||||
Operating Leased Assets [Line Items] | ||||
Option to extend lease, years | 5 years | |||
Period for extended lease | November 1, 2037 through October 31, 2042 |
LEASES AND RELATED PARTY LEAS_4
LEASES AND RELATED PARTY LEASES - Supplemental Balance Sheet Information (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Lessee, Lease, Description [Line Items] | |
ROU assets | $ 64,999 |
Current lease liabilities | 12,619 |
Non-current lease liabilities | 61,711 |
Total lease liabilities | $ 74,330 |
Leased facilities | |
Lessee, Lease, Description [Line Items] | |
Weighted average remaining lease term (in years) | 9 years 11 months 5 days |
Weighted average discount rate | 5.70% |
Leased vehicles | |
Lessee, Lease, Description [Line Items] | |
Weighted average remaining lease term (in years) | 3 years 4 months 20 days |
Weighted average discount rate | 3.20% |
LEASES AND RELATED PARTY LEAS_5
LEASES AND RELATED PARTY LEASES - Supplemental Cash Flow Information (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 3,408 |
ROU assets obtained in exchange for lease liabilities: | |
Operating leases | $ 2,004 |
LEASES AND RELATED PARTY LEAS_6
LEASES AND RELATED PARTY LEASES - Future Minimum Lease Payment Under Operating Leases, After Adoption of 842 (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Operating Leased Assets [Line Items] | |
2019 | $ 11,863 |
2020 | 12,705 |
2021 | 11,828 |
2022 | 9,450 |
2023 | 7,578 |
Thereafter | 42,617 |
Total minimum lease payments | 96,041 |
Less: Imputed interest | 21,711 |
Total lease liabilities | 74,330 |
Less: Current lease liabilities | 12,619 |
Long-term lease liabilities | 61,711 |
Related Parties | |
Operating Leased Assets [Line Items] | |
2019 | 222 |
2020 | 296 |
2021 | 296 |
2022 | 296 |
2023 | 296 |
Thereafter | 1,724 |
Total minimum lease payments | 3,130 |
Third Parties | |
Operating Leased Assets [Line Items] | |
2019 | 11,641 |
2020 | 12,409 |
2021 | 11,532 |
2022 | 9,154 |
2023 | 7,282 |
Thereafter | 40,893 |
Total minimum lease payments | $ 92,911 |
LEASES AND RELATED PARTY LEAS_7
LEASES AND RELATED PARTY LEASES - Future Minimum Lease Payment Under Operating Leases, Before Adoption of 842 (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Operating Leased Assets [Line Items] | |
2019 | $ 16,768 |
2020 | 13,806 |
2021 | 12,493 |
2022 | 13,233 |
2023 | 11,003 |
Thereafter | 102,399 |
Total minimum lease payments | 169,702 |
Related Parties | |
Operating Leased Assets [Line Items] | |
2019 | 296 |
2020 | 296 |
2021 | 296 |
2022 | 296 |
2023 | 296 |
Thereafter | 1,724 |
Total minimum lease payments | 3,204 |
Third Parties | |
Operating Leased Assets [Line Items] | |
2019 | 16,472 |
2020 | 13,510 |
2021 | 12,197 |
2022 | 12,937 |
2023 | 10,707 |
Thereafter | 100,675 |
Total minimum lease payments | $ 166,498 |
TREASURY STOCK - Narrative (Det
TREASURY STOCK - Narrative (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 11, 2018 | Dec. 10, 2018 | |
Treasury Stock Transactions, Excluding Value of Shares Reissued [Abstract] | |||||
Treasury stock (in shares) | 2,900,000 | 2,900,000 | |||
Treasury stock | $ 120,100,000 | $ 120,600,000 | |||
Treasury stock, average cost per share (in dollars per share) | $ 41.87 | $ 41.87 | |||
Stock repurchase program, authorized amount (up to) | $ 225,000,000 | $ 150,000,000 | |||
Amount available for share repurchase under this latest authorization | $ 225,000,000 | ||||
Stock repurchased during period (in shares) | 0 | 0 |
INCOME TAXES - Summary of Effec
INCOME TAXES - Summary of Effective Tax Rate (Details) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||
Reported tax rate | (32.00%) | (20.40%) |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) $ / shares in Units, SFr in Millions, $ in Millions | 3 Months Ended | ||
Mar. 31, 2019CHF (SFr) | Mar. 31, 2019USD ($)$ / shares | Mar. 31, 2018 | |
Income Tax Contingency [Line Items] | |||
Effective income tax rate | (32.00%) | (32.00%) | (20.40%) |
Tax benefit from Switzerland tax holiday | $ | $ 10.8 | ||
Tax benefit from Switzerland tax holiday (in dollars per share) | $ / shares | $ 0.13 | ||
Foreign Tax Authority | Swiss Federal Tax Administration (FTA) | |||
Income Tax Contingency [Line Items] | |||
Federal tax credit | SFr | SFr 12 | ||
Federal tax credit, term | 7 years | 7 years |
NET INCOME PER SHARE - Basic an
NET INCOME PER SHARE - Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Basic net income per share: | ||
Net income | $ 32,756 | $ 10,992 |
Weighted average common shares outstanding - Basic (in shares) | 85,343 | 78,552 |
Basic net income per common share (in dollars per share) | $ 0.38 | $ 0.14 |
Diluted net income per share: | ||
Net income | $ 32,756 | $ 10,992 |
Weighted average common shares outstanding - Basic (in shares) | 85,343 | 78,552 |
Effect of dilutive securities: | ||
Stock options and restricted stock (in shares) | 915 | 1,282 |
Weighted average common shares for diluted earnings per share (in shares) | 86,258 | 79,834 |
Diluted net income per common share (in dollars per share) | $ 0.38 | $ 0.14 |
NET INCOME PER SHARE - Narrativ
NET INCOME PER SHARE - Narrative (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Shares excluded from computation as their effect would be anti-dilutive (in shares) | 0.3 | 0.2 |
Vested Restricted Units and Vested Performance Units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Weighted average number of shares outstanding, basic and diluted (in shares) | 0.5 |
COMPREHENSIVE INCOME - Schedule
COMPREHENSIVE INCOME - Schedule of Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Equity [Abstract] | ||
Net income | $ 32,756 | $ 10,992 |
Foreign currency translation adjustment | (7,009) | 13,780 |
Change in unrealized gain (loss) on derivatives, net of tax | (4,236) | 7,838 |
Pension liability adjustment, net of tax | 9 | (6) |
Comprehensive income, net | $ 21,520 | $ 32,604 |
COMPREHENSIVE INCOME - Schedu_2
COMPREHENSIVE INCOME - Schedule of Changes in Accumulated Other Comprehensive Income by Component (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Balance, Beginning of Period | $ 1,375,796 | $ 962,306 |
Other comprehensive income (loss) | (4,484) | |
Less: Amounts reclassified from accumulated other comprehensive income | 6,752 | |
Net current-period other comprehensive income (loss) | (11,236) | 21,612 |
Balance, End of Period | 1,397,030 | 998,440 |
Gains and Losses on Derivatives | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Balance, Beginning of Period | (4,813) | |
Other comprehensive income (loss) | 2,516 | |
Less: Amounts reclassified from accumulated other comprehensive income | 6,752 | |
Net current-period other comprehensive income (loss) | (4,236) | |
Balance, End of Period | (9,049) | |
Defined Benefit Pension Items | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Balance, Beginning of Period | (736) | |
Other comprehensive income (loss) | 9 | |
Less: Amounts reclassified from accumulated other comprehensive income | 0 | |
Net current-period other comprehensive income (loss) | 9 | |
Balance, End of Period | (727) | |
Foreign Currency Items | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Balance, Beginning of Period | (39,894) | |
Other comprehensive income (loss) | (7,009) | |
Less: Amounts reclassified from accumulated other comprehensive income | 0 | |
Net current-period other comprehensive income (loss) | (7,009) | |
Balance, End of Period | (46,903) | |
Total | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Balance, Beginning of Period | (45,443) | (23,807) |
Net current-period other comprehensive income (loss) | (11,236) | 22,144 |
Balance, End of Period | $ (56,679) | $ (1,663) |
COMPREHENSIVE INCOME - Narrativ
COMPREHENSIVE INCOME - Narrative (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Gain reclassified from accumulated other comprehensive income | $ 6,752 |
Gains and Losses on Derivatives | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Gain reclassified from accumulated other comprehensive income | 6,752 |
Other Income (Expense), net | Gains and Losses on Derivatives | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Gain reclassified from accumulated other comprehensive income | 4,000 |
Interest income | Gains and Losses on Derivatives | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Gain reclassified from accumulated other comprehensive income | $ 2,800 |
SEGMENT AND GEOGRAPHIC INFORM_3
SEGMENT AND GEOGRAPHIC INFORMATION - Narrative (Details) | 3 Months Ended |
Mar. 31, 2019productSegment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | Segment | 2 |
Codman Specialty Surgical | |
Segment Reporting Information [Line Items] | |
Number of products offered (more than) | product | 60,000 |
SEGMENT AND GEOGRAPHIC INFORM_4
SEGMENT AND GEOGRAPHIC INFORMATION - Net Sales and Profit by Reportable Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Net Sales | ||
Total Revenues | $ 359,690 | $ 357,082 |
Segment Profit | ||
Operating income | 32,308 | 25,579 |
Amortization | (5,279) | (5,390) |
Codman Specialty Surgical | ||
Segment Net Sales | ||
Total Revenues | 234,568 | 236,115 |
Orthopedics and Tissue Technologies | ||
Segment Net Sales | ||
Total Revenues | 125,122 | 120,967 |
Operating Segments | ||
Segment Profit | ||
Operating income | 131,875 | 121,929 |
Operating Segments | Codman Specialty Surgical | ||
Segment Profit | ||
Operating income | 91,380 | 89,491 |
Operating Segments | Orthopedics and Tissue Technologies | ||
Segment Profit | ||
Operating income | 40,495 | 32,438 |
Segment Reconciling Items | ||
Segment Profit | ||
Amortization | (5,279) | (5,390) |
Corporate and other | ||
Segment Profit | ||
Operating income | $ (94,288) | $ (90,960) |
SEGMENT AND GEOGRAPHIC INFORM_5
SEGMENT AND GEOGRAPHIC INFORMATION - Total Revenue by Major Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Reporting Information [Line Items] | ||
Total Revenues | $ 359,690 | $ 357,082 |
United States | ||
Segment Reporting Information [Line Items] | ||
Total Revenues | 256,726 | 248,928 |
Europe | ||
Segment Reporting Information [Line Items] | ||
Total Revenues | 48,640 | 51,773 |
Asia Pacific | ||
Segment Reporting Information [Line Items] | ||
Total Revenues | 35,700 | 35,785 |
Rest of World | ||
Segment Reporting Information [Line Items] | ||
Total Revenues | $ 18,624 | $ 20,596 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Fair Value Contingent Consideration (Details) - Contingent Consideration Liability - Fair Value, Inputs, Level 3 - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2019 | Dec. 31, 2018 | |
Derma Sciences | Accrued expenses and other short-term liabilities | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Contingent consideration balance | $ 315 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, Beginning of Period | 315 | ||
Balance, End of Period | 315 | ||
Derma Sciences | Accrued expenses and other short-term liabilities | Selling, general and administrative | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Loss from change in fair value of contingent consideration liabilities | 0 | ||
Derma Sciences | Other Long-term Liabilities | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Contingent consideration balance | 1,387 | $ 230 | $ 230 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, Beginning of Period | 1,387 | ||
Balance, End of Period | 1,419 | ||
Derma Sciences | Other Long-term Liabilities | Selling, general and administrative | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Loss from change in fair value of contingent consideration liabilities | 32 | ||
Confluent Surgical, Inc. | Accrued expenses and other short-term liabilities | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Contingent consideration balance | 22,478 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance, Beginning of Period | 22,478 | ||
Balance, End of Period | 23,900 | ||
Confluent Surgical, Inc. | Accrued expenses and other short-term liabilities | Selling, general and administrative | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Loss from change in fair value of contingent consideration liabilities | $ 1,422 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Narrative (Details) $ in Millions | May 25, 2017USD ($) | Feb. 24, 2017USD ($) | Oct. 31, 2018USD ($) | Aug. 31, 2017USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jan. 15, 2014USD ($) |
Confluent Surgical, Inc. | |||||||||
Loss Contingencies [Line Items] | |||||||||
Maximum contingent consideration | $ 30 | ||||||||
Minimum contingent consideration (up to) | $ 19 | ||||||||
Contingent consideration, liability | $ 19 | ||||||||
Payment for contingent consideration | $ 5 | ||||||||
Confluent Surgical, Inc. | Measurement Input, Discount Rate | Contingent Consideration Liability | |||||||||
Loss Contingencies [Line Items] | |||||||||
Discounted cash flow model, measurement input | 0.022 | ||||||||
Confluent Surgical, Inc. | Cash Consideration One | |||||||||
Loss Contingencies [Line Items] | |||||||||
Maximum contingent consideration | $ 25 | ||||||||
Confluent Surgical, Inc. | Cash Consideration Two | |||||||||
Loss Contingencies [Line Items] | |||||||||
Maximum contingent consideration | $ 5 | ||||||||
Derma Sciences | BioD Earnout Payments | |||||||||
Loss Contingencies [Line Items] | |||||||||
Maximum contingent consideration | $ 26.5 | ||||||||
Contingent consideration, liability | $ 9.1 | $ 0.3 | |||||||
Payment for contingent consideration | $ 4.8 | ||||||||
Revenue volatility percentage | 13.50% | ||||||||
Derma Sciences | BioD Earnout Payments | Measurement Input, Discount Rate | |||||||||
Loss Contingencies [Line Items] | |||||||||
Discounted cash flow model, measurement input | 0.030 | ||||||||
Derma Sciences | Product Payment Contingent Consideration | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payment for contingent consideration liability | $ 26.6 | ||||||||
Derma Sciences | Medihoney Earnout Payments | |||||||||
Loss Contingencies [Line Items] | |||||||||
Maximum contingent consideration | $ 5 | ||||||||
Contingent consideration, liability | $ 1.4 | $ 0.2 | |||||||
Payment for contingent consideration | $ 2 | ||||||||
Revenue volatility percentage | 27.50% | ||||||||
Derma Sciences | Medihoney Earnout Payments | Measurement Input, Discount Rate | |||||||||
Loss Contingencies [Line Items] | |||||||||
Discounted cash flow model, measurement input | 0.045 |
Uncategorized Items - iart-2019
Label | Element | Value |
Accounting Standards Update 2014-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,854,000 |
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,854,000 |