Bioventus Inc. (Nasdaq: BVS) ("Bioventus" or "the Company"), a
global leader in innovations for active healing, today reported
financial results for the three and six months ended July 1,
2023.
Q2 Financial Summary:
- Net Sales of $137.1
million, down $3.3 million, or 2.3%, year-over-year as reported
(2.3% constant currency*), excluding revenues from divested assets,
underlying organic sales decreased $0.5 million, or 0.3%
year-over-year
- Net Loss from
continuing operations of $4.7 million, compared to Net Loss from
continuing operations $7.7 million in prior-year period
- Adjusted
EBITDA* of $28.2 million increased 26.1%, compared to $22.3
million in prior-year period
- Loss per share of
Class A common stock from continuing operations of $0.06, compared
to a loss of $0.11 in prior-year period
- Non-GAAP earnings
per share of Class A common stock from continuing operations* of
$0.14, compared to $0.10 in prior-year period
Recent Highlights:
The Company has taken multiple steps in recent months intended
to stabilize operations and improve its financial position,
including the following:
- Closed the sale of
our Wound Business, generating $31.0 million in net proceeds, which
was used to repay debt
- Repaid $60.3 million
of our term loan and revolver
- Total net leverage
ratio, calculated in accordance with our Amended 2019 Credit
Agreement, reduced to 4.33 compared to 5.50 at December 31,
2022.
“We are pleased with our team’s strong execution in the second
quarter resulting in significant growth in adjusted EBITDA and cash
flow,” commented Tony Bihl, Bioventus’ interim chief executive
officer. “We remain committed to strengthening our financial
position, enhancing liquidity and improving profitability as we
accelerate revenue growth and maintain spending discipline over the
long-term to create value for our stakeholders.”
Second Quarter 2023 Financial Results:
The following table represents net sales by geographic region,
and by vertical, for the three months ended July 1, 2023 and
July 2, 2022, respectively:
|
Three months ended |
|
Change as Reported |
|
Constant Currency* Change |
|
July 1, 2023 |
|
July 2, 2022 |
|
$ |
|
% |
|
% |
U.S. |
|
|
|
|
|
|
|
|
|
Pain Treatments |
$ |
55,617 |
|
$ |
58,055 |
|
$ |
(2,438 |
) |
|
(4.2 |
%) |
|
(4.2 |
%) |
Restorative Therapies |
|
31,844 |
|
|
35,433 |
|
|
(3,589 |
) |
|
(10.1)% |
|
(10.1)% |
Surgical Solutions |
|
33,386 |
|
|
32,822 |
|
|
564 |
|
|
1.7 |
% |
|
1.7 |
% |
Total U.S. net sales |
|
120,847 |
|
|
126,310 |
|
|
(5,463 |
) |
|
(4.3)% |
|
(4.3)% |
International |
|
|
|
|
|
|
|
|
|
Pain Treatments |
|
6,024 |
|
|
5,859 |
|
|
165 |
|
|
2.8 |
% |
|
3.5 |
% |
Restorative Therapies |
|
4,774 |
|
|
4,469 |
|
|
305 |
|
|
6.8 |
% |
|
7.8 |
% |
Surgical Solutions |
|
5,424 |
|
|
3,693 |
|
|
1,731 |
|
|
46.9 |
% |
|
47.6 |
% |
Total International net sales |
|
16,222 |
|
|
14,021 |
|
|
2,201 |
|
|
15.7 |
% |
|
16.5 |
% |
Total net sales |
$ |
137,069 |
|
$ |
140,331 |
|
$ |
(3,262 |
) |
|
(2.3)% |
|
(2.3)% |
Total net sales were $137.1 million compared to $140.3 million
for the second quarter, a decline of 2.3%. Strong volumes in
Surgical Solutions and 15.7% growth in international revenue was
more than offset by the impact of lower Pain Treatment pricing and
Wound Business divestiture.
Gross margin of 65.0% was down compared to prior year gross
margin of 68.9%. Non-GAAP gross margin of 74.0% declined from 76.8%
in the prior year period due to product mix and the impact of lower
pricing in Pain Treatments.
Operating income improved $10.1 million to $6.8 million compared
to a loss of $3.3 million in the second quarter of 2022 driven by
disciplined cost management and a reduction in equity-based
compensation. Operating margin was 4.9% compared to (2.4%) in the
prior year period.
Non-GAAP operating income* improved $9.3 million to $27.6
million compared to $18.3 million in the prior year. Non-GAAP
operating margin was 20.1% versus 13.1% second quarter of 2022.
Net loss from continuing operations was $4.7 million (or $0.06
per share of Class A common stock from continuing operations)
compared to a net loss of $7.7 million (or $0.11 per share of Class
A common stock from continuing operations) in second quarter of
2022.
Adjusted EBITDA increased $5.8 million to $28.2 million compared
to $22.3 million in the prior year.
Non-GAAP net income and earnings per share of Class A common
stock from continuing operations* increased 27.7% and 41.2%,
respectively, to $10.9 million or $0.14 per share of Class A common
stock from continuing operations* compared to $8.5 million or $0.10
per share of Class A common stock from continuing operations*.
Balance Sheet:
As of July 1, 2023, the Company had $29.4 million in cash
and cash equivalents and $385.9 million in debt obligations,
compared to $30.2 million in cash and cash equivalents and $418.1
million in debt obligations as of December 31, 2022.
2023 Financial Guidance:
For the twelve months ending December 31, 2023, the Company
expects:
- Net sales of $490
million to $505 million
- Adjusted EBITDA* of
$75 million to $80 million
- Non-GAAP EPS* of ($0.24) to
($0.20)
The Company does not provide U.S. GAAP financial measures, other
than net sales, on a forward-looking basis, because the Company is
unable to predict with reasonable certainty the impact and timing
of acquisition related expenses, accounting fair-value adjustments,
and certain other reconciling items without unreasonable efforts.
These items are uncertain, depend on various factors, and could be
material to the Company’s results computed in accordance with U.S.
GAAP.
Presentation: This press release presents
historical results, for the periods presented, of Bioventus Inc.,
including Bioventus LLC, the predecessor of Bioventus Inc. for
financial reporting purposes.
About Bioventus
Bioventus delivers clinically proven, cost-effective products
that help people heal quickly and safely. Its mission is to make a
difference by helping patients resume and enjoy active lives. The
Innovations for Active Healing from Bioventus include offerings for
pain treatments, restorative therapies and surgical solutions.
Built on a commitment to high quality standards, evidence-based
medicine and strong ethical behavior, Bioventus is a trusted
partner for physicians worldwide. For more information, visit
www.bioventus.com, and follow the Company on LinkedIn and Twitter.
Bioventus and the Bioventus logo are registered trademarks of
Bioventus LLC.
Second Quarter 2023 Earnings Conference
Call:
Management will host a conference call to discuss the Company’s
financial results and provide a business update, with a question
and answer session, at 8:30 a.m. Eastern Time on August 8,
2023. Those who would like to participate may dial 1-800-715-9871
(domestic and international) and refer to the Bioventus Inc.
Conference Call or Conference ID 8443075.
A live webcast of the call and any accompanying materials will
also be provided on the investor relations section of the Company's
website at https://ir.bioventus.com/.
The webcast will be archived on the Company’s website at
https://ir.bioventus.com/ and available for replay until
August 7, 2024.
Legal Notice Regarding Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements contained in this press release that do not
relate to matters of historical fact should be considered
forward-looking statements, including, without limitation,
statements concerning our future financial results and liquidity;
our ability to continue as a going concern; the impact of our
recent amendment to our Credit Agreement on our financial
condition, operations, and liquidity; our business strategy,
position and operations; and expected sales trends, opportunities,
market position and growth. In some cases, you can identify
forward-looking statements by terminology such as “aim,”
“anticipate,” “assume,” “believe,” “contemplate,” “continue,”
“could,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,”
“objective,” “plan,” “predict,” “potential,” “positioned,” “seek,”
“should,” “target,” “will,” “would” and other similar expressions
that are predictions of or indicate future events and future
trends, or the negative of these terms or other comparable
terminology, although not all forward-looking statements contain
these words.
Forward-looking statements are inherently subject to risks and
uncertainties, some of which cannot be predicted or quantified.
Factors that could cause our actual results to differ materially
from those contemplated in this press release include, but are not
limited to, the risk that the previously identified material
weaknesses or new material weaknesses could adversely affect our
ability to report our results of operations and financial condition
accurately and in a timely manner; we might not be able to continue
to fund our operations for at least the next twelve months as a
going concern; we might not meet certain of our debt covenants
under our Credit Agreement and might be required to repay our
indebtedness; risks associated with the disposition of our Wound
Business and expected impacts on our business; restrictions on
operations and other costs associated with our indebtedness; our
ability to complete acquisitions or successfully integrate new
businesses, products or technologies in a cost-effective and
non-disruptive manner; we maintain cash at financial institutions,
often in balance that exceed federally insured limits; we are
subject to securities class action litigation and may be subject to
similar or other litigation in the future, which will require
significant management time and attention, result in significant
legal expenses and may result in unfavorable outcomes; our ability
to maintain our competitive position depends on our ability to
attract, retain and motivate our senior management team and highly
qualified personnel; we are highly dependent on a limited number of
products; our long-term growth depends on our ability to develop,
acquire and commercialize new products, line extensions or expanded
indications; we may be unable to successfully commercialize newly
developed or acquired products or therapies in the United States;
demand for our existing portfolio of products and any new products,
line extensions or expanded indications depends on the continued
and future acceptance of our products by physicians, patients,
third-party payers and others in the medical community; the
proposed down classification of non-invasive bone growth
stimulators, including our Exogen system, by the U.S. Food and Drug
Administration (FDA) could increase future competition for bone
growth stimulators and otherwise adversely affect the Company’s
sales of Exogen; failure to achieve and maintain adequate levels of
coverage and/or reimbursement for our products or future products,
the procedures using our products, such as our hyaluronic acid (HA)
viscosupplements, or future products we may seek to commercialize;
pricing pressure and other competitive factors; governments outside
the United States might not provide coverage or reimbursement of
our products; we compete and may compete in the future against
other companies, some of which have longer operating histories,
more established products or greater resources than we do; the
reclassification of our HA products from medical devices to drugs
in the United States by the FDA could negatively impact our ability
to market these products and may require that we conduct costly
additional clinical studies to support current or future
indications for use of those products; our failure to properly
manage our anticipated growth and strengthen our brands; risks
related to product liability claims; fluctuations in demand for our
products; issues relating to the supply of our products, potential
supply chain disruptions and the increased cost of parts and
components used to manufacture our products due to inflation; our
reliance on a limited number of third-party manufacturers to
manufacture certain of our products; if our facilities are damaged
or become inoperable, we will be unable to continue to research,
develop and manufacture our products; failure to maintain
contractual relationships; security breaches, unauthorized
disclosure of information, denial of service attacks or the
perception that confidential information in our possession is not
secure; failure of key information technology and communications
systems, process or sites; risks related to international sales and
operations; risks related to our debt and future capital needs;
failure to comply with extensive governmental regulation relevant
to us and our products; we may be subject to enforcement action if
we engage in improper claims submission practices and resulting
audits or denials of our claims by government agencies could reduce
our net sales or profits; the FDA regulatory process is expensive,
time-consuming and uncertain, and the failure to obtain and
maintain required regulatory clearances and approvals could prevent
us from commercializing our products; if clinical studies of our
future product candidates do not produce results necessary to
support regulatory clearance or approval in the United States or
elsewhere, we will be unable to expand the indications for or
commercialize these products; legislative or regulatory reforms;
our business may continue to experience adverse impacts as a result
of the COVID-19 pandemic or similar epidemics; risks related to
intellectual property matters; and the other risks identified in
our Annual Report on Form 10-K for the year ended December 31,
2022, as updated by Bioventus' subsequent Quarterly Report on Form
10-Q for the quarter ended April 1, 2023 and as may be further
updated from time to time in Bioventus’ other filings with the SEC,
which are accessible on the SEC’s website at www.sec.gov and the
Investor Relations page of Bioventus’ website at
https://ir.bioventus.com. Except to the extent required by law, the
Company undertakes no obligation to update or review any estimate,
projection, or forward-looking statement. Actual results may differ
materially from those set forth in the forward-looking
statements.
BIOVENTUS INC.Consolidated balance
sheetsAs of July 1,
2023 and December 31,
2022(Amounts in thousands, except share amounts)
(unaudited) |
|
|
|
|
|
|
|
|
|
July 1, 2023 |
|
December 31, 2022 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
29,389 |
|
|
$ |
30,186 |
|
Accounts receivable, net |
|
119,636 |
|
|
|
136,295 |
|
Inventory |
|
96,276 |
|
|
|
84,766 |
|
Prepaid and other current assets |
|
15,337 |
|
|
|
18,551 |
|
Current assets attributable to discontinued operations |
|
— |
|
|
|
2,777 |
|
Total current assets |
|
260,638 |
|
|
|
272,575 |
|
Property and equipment,
net |
|
41,862 |
|
|
|
27,456 |
|
Goodwill |
|
7,462 |
|
|
|
7,462 |
|
Intangible assets, net |
|
505,223 |
|
|
|
639,851 |
|
Operating lease assets |
|
15,238 |
|
|
|
16,690 |
|
Investment and other
assets |
|
6,539 |
|
|
|
2,621 |
|
Long-term assets attributable
to discontinued operations |
|
— |
|
|
|
405,994 |
|
Total assets |
$ |
836,962 |
|
|
$ |
1,372,649 |
|
Liabilities and
Members’ Equity |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
41,364 |
|
|
$ |
36,697 |
|
Accrued liabilities |
|
121,748 |
|
|
|
111,570 |
|
Current portion of long-term debt |
|
11,320 |
|
|
|
33,056 |
|
Other current liabilities |
|
4,672 |
|
|
|
3,607 |
|
Current liabilities
attributable to discontinued operations |
|
— |
|
|
|
119,087 |
|
Total current liabilities |
|
179,104 |
|
|
|
304,017 |
|
Long-term debt, less current
portion |
|
374,568 |
|
|
|
385,010 |
|
Deferred income taxes |
|
— |
|
|
|
2,248 |
|
Contingent consideration |
|
17,958 |
|
|
|
17,431 |
|
Other long-term
liabilities |
|
31,991 |
|
|
|
22,810 |
|
Long-term liabilities
attributable to discontinued operations |
|
— |
|
|
|
228,911 |
|
Total liabilities |
|
603,621 |
|
|
|
960,427 |
|
Stockholders’
Equity: |
|
|
|
Preferred stock, $0.001 par
value, 10,000,000 shares authorized, 0 shares issued |
|
|
|
Class A common stock, $0.001
par value, 250,000,000 shares authorized as of July 1, 2023
and December 31, 2022, 62,804,506 and 62,063,014 shares issued
and outstanding as of July 1, 2023 and December 31, 2022,
respectively |
|
63 |
|
|
|
62 |
|
Class B common stock, $0.001
par value, 50,000,000 shares authorized, 15,786,737 shares issued
and outstanding as of July 1, 2023 and December 31,
2022 |
|
16 |
|
|
|
16 |
|
Additional paid-in
capital |
|
490,598 |
|
|
|
490,576 |
|
Accumulated deficit |
|
(308,137 |
) |
|
|
(165,306 |
) |
Accumulated other
comprehensive income (loss) |
|
655 |
|
|
|
(110 |
) |
Total stockholders’ equity
attributable to Bioventus Inc. |
|
183,195 |
|
|
|
325,238 |
|
Noncontrolling interest |
|
50,146 |
|
|
|
86,984 |
|
Total stockholders’
equity |
|
233,341 |
|
|
|
412,222 |
|
Total liabilities and
stockholders’ equity |
$ |
836,962 |
|
|
$ |
1,372,649 |
|
BIOVENTUS INC.Consolidated statements of
operations and comprehensive
loss(Amounts in thousands, except share and per
share data, unaudited) |
|
|
|
|
|
Three Months Ended |
|
Six months ended |
|
July 1, 2023 |
|
July 2, 2022 |
|
July 1, 2023 |
|
July 2, 2022 |
Net sales |
$ |
137,069 |
|
|
$ |
140,331 |
|
|
$ |
256,128 |
|
|
$ |
257,621 |
|
Cost of sales (including
depreciation and amortization of $12,301, $9,684, $26,640, and
$18,902 respectively) |
|
47,946 |
|
|
|
43,677 |
|
|
|
93,086 |
|
|
|
85,265 |
|
Gross profit |
|
89,123 |
|
|
|
96,654 |
|
|
|
163,042 |
|
|
|
172,356 |
|
Selling, general and
administrative expense |
|
74,844 |
|
|
|
89,620 |
|
|
|
155,702 |
|
|
|
175,744 |
|
Research and development
expense |
|
3,398 |
|
|
|
6,366 |
|
|
|
7,169 |
|
|
|
13,294 |
|
Restructuring costs |
|
620 |
|
|
|
1,007 |
|
|
|
937 |
|
|
|
1,584 |
|
Change in fair value of
contingent consideration |
|
240 |
|
|
|
273 |
|
|
|
527 |
|
|
|
542 |
|
Depreciation and
amortization |
|
2,294 |
|
|
|
2,696 |
|
|
|
4,423 |
|
|
|
5,950 |
|
Impairment of assets |
|
— |
|
|
|
— |
|
|
|
78,615 |
|
|
|
— |
|
Loss on disposal of a
business |
|
977 |
|
|
|
— |
|
|
|
977 |
|
|
|
— |
|
Operating income (loss) |
|
6,750 |
|
|
|
(3,308 |
) |
|
|
(85,308 |
) |
|
|
(24,758 |
) |
Interest expense, net |
|
10,587 |
|
|
|
2,578 |
|
|
|
20,281 |
|
|
|
1,028 |
|
Other expense (income) |
|
513 |
|
|
|
604 |
|
|
|
(1,075 |
) |
|
|
241 |
|
Other expense |
|
11,100 |
|
|
|
3,182 |
|
|
|
19,206 |
|
|
|
1,269 |
|
Loss before income taxes |
|
(4,350 |
) |
|
|
(6,490 |
) |
|
|
(104,514 |
) |
|
|
(26,027 |
) |
Income tax expense (benefit),
net |
|
381 |
|
|
|
1,244 |
|
|
|
235 |
|
|
|
(3,888 |
) |
Net loss from continuing
operations |
|
(4,731 |
) |
|
|
(7,734 |
) |
|
|
(104,749 |
) |
|
|
(22,139 |
) |
Loss from discontinued
operations, net of tax |
|
— |
|
|
|
(280 |
) |
|
|
(74,429 |
) |
|
|
(681 |
) |
Net loss |
|
(4,731 |
) |
|
|
(8,014 |
) |
|
|
(179,178 |
) |
|
|
(22,820 |
) |
Loss attributable to
noncontrolling interest - continuing operations |
|
1,050 |
|
|
|
762 |
|
|
|
21,410 |
|
|
|
4,291 |
|
Loss attributable to
noncontrolling interest - discontinued operations |
|
— |
|
|
|
— |
|
|
|
14,937 |
|
|
|
— |
|
Net loss attributable to
Bioventus Inc. |
$ |
(3,681 |
) |
|
$ |
(7,252 |
) |
|
$ |
(142,831 |
) |
|
$ |
(18,529 |
) |
|
|
|
|
|
|
|
|
Net loss from continuing
operations |
$ |
(4,731 |
) |
|
$ |
(7,734 |
) |
|
$ |
(104,749 |
) |
|
$ |
(22,139 |
) |
Other comprehensive income
(loss), net of tax |
|
|
|
|
|
|
|
Change in foreign currency translation adjustments |
|
303 |
|
|
|
(507 |
) |
|
|
960 |
|
|
|
(1,189 |
) |
Comprehensive loss |
|
(4,428 |
) |
|
|
(8,241 |
) |
|
|
(103,789 |
) |
|
|
(23,328 |
) |
Comprehensive loss
attributable to noncontrolling interest - continuing
operations |
|
989 |
|
|
|
868 |
|
|
|
21,215 |
|
|
|
4,537 |
|
Comprehensive loss
attributable to noncontrolling interest - discontinued
operations |
|
— |
|
|
|
— |
|
|
|
14,937 |
|
|
|
— |
|
Comprehensive loss
attributable to Bioventus Inc. |
$ |
(3,439 |
) |
|
$ |
(7,373 |
) |
|
$ |
(67,637 |
) |
|
$ |
(18,791 |
) |
|
|
|
|
|
|
|
|
Loss per share of Class A
common stock from continuing operations, basic and diluted: |
$ |
(0.06 |
) |
|
$ |
(0.11 |
) |
|
$ |
(1.34 |
) |
|
$ |
(0.29 |
) |
Loss per share of Class A
common stock from discontinued operations, basic and diluted: |
|
— |
|
|
|
— |
|
|
|
(0.95 |
) |
|
|
(0.01 |
) |
Loss per share of Class A common stock, basic and diluted |
$ |
(0.06 |
) |
|
$ |
(0.11 |
) |
|
$ |
(2.29 |
) |
|
$ |
(0.30 |
) |
Weighted-average shares of
Class A common stock outstanding: |
|
|
|
|
|
|
|
Basic and diluted |
|
62,551,285 |
|
|
|
61,475,350 |
|
|
|
62,338,018 |
|
|
|
60,977,556 |
|
|
|
|
|
|
|
|
|
BIOVENTUS INC.Consolidated condensed
statements of cash flows(Amounts in thousands,
unaudited) |
|
|
|
|
|
Three Months Ended |
|
Six months ended |
|
July 1, 2023 |
|
July 2, 2022 |
|
July 1, 2023 |
|
July 2, 2022 |
Operating
activities: |
|
|
|
|
|
|
|
Net loss |
$ |
(4,731 |
) |
|
$ |
(8,014 |
) |
|
$ |
(179,178 |
) |
|
$ |
(22,820 |
) |
Less: Loss from discontinued
operations, net of tax |
|
— |
|
|
|
(280 |
) |
|
|
(74,429 |
) |
|
|
(681 |
) |
Loss from continuing
operations |
|
(4,731 |
) |
|
|
(7,734 |
) |
|
|
(104,749 |
) |
|
|
(22,139 |
) |
Adjustments to reconcile net
loss to net cash from operating activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
|
14,600 |
|
|
|
12,384 |
|
|
|
31,073 |
|
|
|
24,863 |
|
Equity based compensation |
|
(2,732 |
) |
|
|
4,616 |
|
|
|
(886 |
) |
|
|
9,505 |
|
Change in fair value of contingent consideration |
|
240 |
|
|
|
273 |
|
|
|
527 |
|
|
|
542 |
|
Change in fair value of interest rate swap |
|
— |
|
|
|
(272 |
) |
|
|
— |
|
|
|
(4,196 |
) |
Impairment of assets |
|
— |
|
|
|
— |
|
|
|
78,615 |
|
|
|
— |
|
Deferred income taxes |
|
(876 |
) |
|
|
(10,680 |
) |
|
|
(3,540 |
) |
|
|
(27,698 |
) |
Unrealized loss on foreign currency fluctuations |
|
(146 |
) |
|
|
976 |
|
|
|
601 |
|
|
|
1,020 |
|
Loss on disposal of a business |
|
977 |
|
|
|
— |
|
|
|
977 |
|
|
|
— |
|
Other, net |
|
476 |
|
|
|
1,558 |
|
|
|
1,779 |
|
|
|
2,913 |
|
Changes in working capital |
|
2,987 |
|
|
|
1,818 |
|
|
|
11,057 |
|
|
|
(2,890 |
) |
Net cash from operating
activities - continuing operations |
|
10,795 |
|
|
|
2,939 |
|
|
|
15,454 |
|
|
|
(18,080 |
) |
Net cash from operating
activities - discontinued operations |
|
— |
|
|
|
— |
|
|
|
(2,169 |
) |
|
|
— |
|
Net cash from operating
activities |
|
10,795 |
|
|
|
2,939 |
|
|
|
13,285 |
|
|
|
(18,080 |
) |
Investing
activities: |
|
|
|
|
|
|
|
Proceeds from sale of a business |
|
34,897 |
|
|
|
— |
|
|
|
34,897 |
|
|
|
— |
|
Investment held in trust for the acquisition of CartiHeal |
|
— |
|
|
|
(50,000 |
) |
|
|
— |
|
|
|
(50,000 |
) |
Acquisitions, net of cash acquired |
|
— |
|
|
|
5 |
|
|
|
— |
|
|
|
(231 |
) |
Purchase of property and equipment |
|
(1,397 |
) |
|
|
(2,030 |
) |
|
|
(4,957 |
) |
|
|
(4,990 |
) |
Investments and acquisition of distribution rights |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,478 |
) |
Net cash from investing
activities - continuing operations |
|
33,500 |
|
|
|
(52,025 |
) |
|
|
29,940 |
|
|
|
(56,699 |
) |
Net cash from investing
activities - discontinued operations |
|
— |
|
|
|
— |
|
|
|
(11,506 |
) |
|
|
— |
|
Net cash from
investing activities |
|
33,500 |
|
|
|
(52,025 |
) |
|
|
18,434 |
|
|
|
(56,699 |
) |
Financing
activities: |
|
|
|
|
|
|
|
Proceeds from issuance of
Class A and B common stock |
|
139 |
|
|
|
2,177 |
|
|
|
223 |
|
|
|
4,257 |
|
Tax withholdings on
equity-based compensation |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3,352 |
) |
Borrowing on revolver |
|
— |
|
|
|
10,000 |
|
|
|
49,000 |
|
|
|
25,000 |
|
Payment on revolver |
|
(22,000 |
) |
|
|
— |
|
|
|
(42,000 |
) |
|
|
— |
|
Debt refinancing costs |
|
(1,993 |
) |
|
|
— |
|
|
|
(3,661 |
) |
|
|
— |
|
Payments on long-term
debt |
|
(38,264 |
) |
|
|
(4,510 |
) |
|
|
(38,264 |
) |
|
|
(9,019 |
) |
Other, net |
|
(130 |
) |
|
|
(12 |
) |
|
|
(166 |
) |
|
|
(26 |
) |
Net cash from financing
activities |
|
(62,248 |
) |
|
|
7,655 |
|
|
|
(34,868 |
) |
|
|
16,860 |
|
Effect of exchange
rate changes on cash |
|
240 |
|
|
|
(222 |
) |
|
|
701 |
|
|
|
(293 |
) |
Net change in cash,
cash equivalents and restricted cash |
|
(17,713 |
) |
|
|
(41,653 |
) |
|
|
(2,448 |
) |
|
|
(58,212 |
) |
Cash, cash equivalents
and restricted cash at the beginning of the period |
|
47,102 |
|
|
|
82,654 |
|
|
|
31,837 |
|
|
|
99,213 |
|
Cash, cash equivalents
and restricted cash at the end of the period |
$ |
29,389 |
|
|
$ |
41,001 |
|
|
$ |
29,389 |
|
|
$ |
41,001 |
|
Use of Non-GAAP Financial
Measures
Organic Revenue Growth
The Company defines the term “organic revenue” as revenue in the
stated period excluding the impact from business acquisitions and
divestitures. The Company uses the related term “organic revenue
growth” to refer to the financial performance metric of comparing
the stated period's organic revenue with the comparable reported
revenue of the corresponding period in the prior year. The Company
believes that these non-GAAP financial measures, when taken
together with GAAP financial measures, allow the Company and its
investors to better measure the Company’s performance and evaluate
long-term performance trends. Organic revenue growth also
facilitates easier comparisons of the Company’s performance with
prior and future periods and relative comparisons to its peers. The
Company excludes the effect of acquisitions and divestitures
because these activities can have a significant impact on the
Company's reported results, which the Company believes makes
comparisons of long-term performance trends difficult for
management and investors.
Adjusted EBITDA, Non-GAAP Gross Profit, Non-GAAP Gross
Margin, Non-GAAP Operating Income, Non-GAAP Operating Expense,
Non-GAAP Operating Margin, Non-GAAP Net Income from continuing
operations, and Non-GAAP Earnings per share of Class A Common Stock
from continuing operations
We present Adjusted EBITDA, Non-GAAP Gross Profit, Non-GAAP
Gross Margin, Non-GAAP Operating Income, Non-GAAP Operating
Expense, Non-GAAP Operating Margin, Non-GAAP Net Income from
continuing operations, and Non-GAAP Earnings per share of Class A
common stock from continuing operations, all non-GAAP financial
measures, to supplement our GAAP financial reporting, because we
believe these measures are useful indicators of our operating
performance. Beginning in the first quarter of 2023, we revised our
presentation of Non-GAAP measures to remove the foreign exchange
adjustment and include financial restructuring costs. The prior
year has been recast to conform to the current period.
We define Adjusted EBITDA as net loss from continuing operations
before depreciation and amortization, provision of income taxes and
interest expense (income), net, adjusted for the impact of certain
cash, non-cash and other items that we do not consider in our
evaluation of ongoing operating performance. These items include
acquisition and related costs, impairments of goodwill, impairment
of assets, restructuring and succession charges, equity
compensation expense, financial restructuring costs and other
items. See the table below for a reconciliation of net (loss)
income from continuing operations to Adjusted EBITDA. Our
management uses Adjusted EBITDA principally as a measure of our
operating performance and believes that Adjusted EBITDA is useful
to our investors because it is frequently used by securities
analysts, investors and other interested parties in their
evaluation of the operating performance of companies in industries
similar to ours. Our management also uses Adjusted EBITDA for
planning purposes, including the preparation of our annual
operating budget and financial projections.
Our management uses Non-GAAP Gross Profit, Non-GAAP Gross
Margin, Non-GAAP Operating Income, Non-GAAP Operating Expense,
Non-GAAP Operating Margin and Non-GAAP Net Income from continuing
operations principally as measures of our operating performance and
believes that these non-GAAP financial measures are useful to
better understand the long term performance of our core business
and to facilitate comparison of our results to those of peer
companies. Our management also uses these non-GAAP financial
measures for planning purposes, including the preparation of our
annual operating budget and financial projections.
We define Non-GAAP Gross Profit as gross profit, adjusted for
the impact of certain cash, non-cash and other items that we do not
consider in our evaluation of ongoing operating performance. These
items include depreciation and amortization included in the cost of
goods sold and acquisition and related costs in the cost of goods
sold. We define Non-GAAP Gross Margin as Non-GAAP Gross Profit
divided by net sales. See the table below for a reconciliation of
gross profit and gross margin to Non-GAAP Gross Profit and Non-GAAP
Gross Margin.
We define Non-GAAP Operating Income as operating income,
adjusted for the impact of certain cash, non-cash and other items
that we do not consider in our evaluation of ongoing operating
performance. These items include depreciation and amortization,
acquisition and related costs, impairments of goodwill, impairment
of assets, restructuring and succession charges, loss on disposal
of a business, financial restructuring costs, and other items.
Non-GAAP Operating Margin is defined as Non-GAAP Operating Income
divided by net sales. See the table below for a reconciliation of
operating (loss) income and operating margin to Non-GAAP Operating
Income and Non-GAAP Operating Margin.
We define Non-GAAP Operating Expense as operating expenses,
adjusted to exclude certain cash, non-cash and other items that we
do not consider in our evaluation of ongoing operating performance.
These items include depreciation and amortization, acquisition and
related costs, impairments of goodwill, impairment of assets, loss
on disposal of a business, restructuring and succession charges,
financial restructuring costs and other items. See the table below
for a reconciliation of operating expenses to Non-GAAP Operating
Expenses.
We define Non-GAAP R&D as research and development, adjusted
to exclude certain cash, non-cash and other items that we do not
consider in our evaluation of ongoing operating performance. These
items include depreciation and amortization, acquisition and
related costs, restructuring and succession charges, and other
items. See the table below for a reconciliation of operating
expenses to Non-GAAP R&D.
We define Non-GAAP Net Income from continuing operations as Net
Income from continuing operations, adjusted for the impact of
certain cash, non-cash and other items that we do not consider in
our evaluation of ongoing operating performance. These items
include depreciation and amortization, acquisition and related
costs, restructuring and succession charges, impairments of
goodwill, impairment of assets, loss on disposal of a business,
financial restructuring costs, other items and the tax effect of
adjusting items. See the table below for a reconciliation of Net
(Loss) Income from continuing operations to Non-GAAP Net Income
from continuing operations.
We define Non-GAAP Earnings per Class A share from continuing
operations as Earnings per Class A share, adjusted for the impact
of certain cash, non-cash and other items that we do not consider
in our evaluation of ongoing operating performance. These items
include depreciation and amortization, acquisition and related
costs, restructuring and succession charges, impairments of
goodwill, impairment of assets, loss on disposal of a business,
financial restructuring costs, other items and the tax effect of
adjusting items divided by weighted average number of shares of
Class A common stock outstanding during the period. See the table
below for a reconciliation of loss per Class A share to Non-GAAP
Earnings per Class A share.
Net Sales, International Net Sales Growth and Constant
Currency Basis
Net Sales, International Net Sales Growth and Constant Currency
Basis are non-GAAP measures, which are calculated by translating
current and prior year results at the same foreign currency
exchange rate. Constant currency can be presented for numerous GAAP
measures, but is most commonly used by management to facilitate the
comparison sales in foreign currencies to prior periods and analyze
net sales performance without the impact of changes in foreign
currency exchange rates.
Limitations of the Usefulness of Non-GAAP
Measures
Non-GAAP financial measures have limitations as an analytical
tool and should not be considered in isolation or as a substitute
for, or as superior to, the financial information prepared and
presented in accordance with GAAP. These measures might exclude
certain normal recurring expenses. Therefore, these measures may
not provide a complete understanding of the Company's performance
and should be reviewed in conjunction with the GAAP financial
measures. Additionally, other companies might define their non-GAAP
financial measures differently than we do. Investors are encouraged
to review the reconciliation of the non-GAAP measures provided in
this press release, including in the tables below, to their most
directly comparable GAAP measures. Additionally, the Company does
not provide U.S. GAAP financial measures on a forward-looking basis
because the Company is unable to predict with reasonable certainty
the impact and timing of acquisitions related expenses, accounting
fair-value adjustments and certain other reconciling items without
unreasonable efforts. These items are uncertain, depend on various
factors, and could be material to the Company’s results computed in
accordance with U.S. GAAP.
Reconciliation of Net (Loss) Income from Continuing
Operations to Adjusted EBITDA (unaudited) |
|
Three Months Ended |
|
Six Months Ended |
|
Twelve Months Ended |
($,
thousands) |
July 1, 2023 |
|
July 2, 2022 |
|
July 1, 2023 |
|
July 2, 2022 |
|
December 31, 2022 |
Net loss from continuing operations |
$ |
(4,731 |
) |
|
$ |
(7,734 |
) |
|
$ |
(104,749 |
) |
|
$ |
(22,139 |
) |
|
$ |
(236,097 |
) |
Interest expense, net |
|
10,587 |
|
|
|
2,578 |
|
|
|
20,281 |
|
|
|
1,028 |
|
|
|
25,795 |
|
Income tax expense (benefit),
net |
|
381 |
|
|
|
1,244 |
|
|
|
235 |
|
|
|
(3,888 |
) |
|
|
(50,508 |
) |
Depreciation and amortization(a) |
|
14,600 |
|
|
|
12,384 |
|
|
|
31,073 |
|
|
|
24,863 |
|
|
|
66,803 |
|
Acquisition and related
costs(b) |
|
1,448 |
|
|
|
5,994 |
|
|
|
2,623 |
|
|
|
13,972 |
|
|
|
27,081 |
|
Restructuring and succession
charges(c) |
|
620 |
|
|
|
1,695 |
|
|
|
937 |
|
|
|
2,272 |
|
|
|
7,453 |
|
Equity compensation(d) |
|
(2,732 |
) |
|
|
4,616 |
|
|
|
(886 |
) |
|
|
9,505 |
|
|
|
17,585 |
|
Financial restructuring
costs(e) |
|
1,257 |
|
|
|
— |
|
|
|
6,587 |
|
|
|
— |
|
|
|
— |
|
Impairment of assets(f) |
|
— |
|
|
|
— |
|
|
|
78,615 |
|
|
|
— |
|
|
|
10,285 |
|
Impairment of goodwill(g) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
189,197 |
|
Loss on disposal of a business(h) |
|
977 |
|
|
|
— |
|
|
|
977 |
|
|
|
— |
|
|
|
— |
|
Other items(i) |
|
5,751 |
|
|
|
1,552 |
|
|
|
9,416 |
|
|
|
3,888 |
|
|
|
8,465 |
|
Adjusted
EBITDA |
$ |
28,158 |
|
|
$ |
22,329 |
|
|
$ |
45,109 |
|
|
$ |
29,501 |
|
|
$ |
66,059 |
|
(a) |
Includes for the three months ended July 1, 2023 and
July 2, 2022 and the six months ended July 1, 2023 and
July 2, 2022, respectively, depreciation and amortization of
$12,301, $9,684, $26,640 and $18,902 in cost of sales and $2,299,
$2,700, $4,433 and $5,961 in operating expenses presented in the
consolidated statements of operations and comprehensive
loss.Includes for the years ended December 31, 2022,
depreciation and amortization of $45,622 in cost of sales and
$21,181 in operating expenses. |
|
|
(b) |
Includes acquisition and integration costs related to
completed acquisitions, amortization of inventory step-up
associated with acquired entities, and changes in fair value of
contingent consideration. |
|
|
(c) |
Costs
incurred were the result of adopting restructuring plans to reduce
headcount, reorganize management structure, and to consolidate
certain facilities. |
|
|
(d) |
Includes compensation expense resulting from awards granted
under the Company’s equity-based compensation plans. The three and
six months ended July 1, 2023 include the reversal of equity
compensation expenses totaling $3.8 million related to the
transition of our executive leadership. |
|
|
(e) |
Financial
restructuring costs which include advisory fees and debt amendment
related costs. |
|
|
(f) |
Represents a
non-cash impairment charge for intangible assets attributable to
our Wound Business due to our decision to divest the business. |
|
|
(g) |
Represents a
non-cash impairment charge due to the decline in the Company’s
market capitalization. |
|
|
(h) |
Represents the loss on disposal of the Wound Business. |
|
|
(i) |
Other
items primarily includes charges associated with strategic
transactions, such as potential acquisitions or divestitures,
incremental one-time consulting costs related to the
recertification of certain products to comply with the new and
extensive EU MDR requirements and costs attributable to MOTYS.
During the second quarter of 2022, prior to obtaining the results
from our Phase 2 trial, we elected to discontinue the development
of MOTYS, to focus our resources on other priorities, including the
integration of our acquisitions and our expanded R&D and
product development portfolio we inherited with these acquisitions.
We incurred $0.3 million and $1.2 million, respectively, during the
three and six months ended July 1, 2023 related to MOTYS. We
expect to incur up to $0.5 million in remaining expenditures. Other
items for the three and six months ended July 1, 2023 also
includes severance costs totaling $2.3 million related to the
transition of our executive leadership. |
Reconciliation of Other Reported GAAP Measures to
Non-GAAP Measures |
Three Months Ended
July 1, 2023 |
Gross Profit |
|
Operating Expenses(a) |
|
R&D |
|
Operating Income |
|
Net Loss Continuing Operations |
|
EPS from Continuing
Operations(j) |
Reported GAAP measure |
$ |
89,123 |
|
|
$ |
78,975 |
|
$ |
3,398 |
|
$ |
6,750 |
|
|
$ |
(4,731 |
) |
|
$ |
(0.06 |
) |
Reported GAAP
margin |
|
65.0 |
% |
|
|
|
|
|
|
4.9 |
% |
|
|
|
|
Depreciation and
amortization(b) |
|
12,301 |
|
|
|
2,294 |
|
|
5 |
|
|
14,600 |
|
|
|
14,600 |
|
|
|
0.19 |
|
Acquisition and related
costs(c) |
|
— |
|
|
|
1,448 |
|
|
— |
|
|
1,448 |
|
|
|
1,448 |
|
|
|
0.02 |
|
Restructuring and succession
charges(d) |
|
— |
|
|
|
620 |
|
|
— |
|
|
620 |
|
|
|
620 |
|
|
|
0.01 |
|
Financial restructuring
costs(f) |
|
— |
|
|
|
1,257 |
|
|
— |
|
|
1,257 |
|
|
|
1,257 |
|
|
|
0.02 |
|
Loss on disposal of a
business(g) |
|
— |
|
|
|
977 |
|
|
— |
|
|
977 |
|
|
|
977 |
|
|
|
0.01 |
|
Other items(h) |
|
— |
|
|
|
1,675 |
|
|
274 |
|
|
1,949 |
|
|
|
1,949 |
|
|
|
0.02 |
|
Tax effect of adjusting
items(i) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
|
|
|
(5,234 |
) |
|
|
(0.07 |
) |
Non-GAAP
measure |
$ |
101,424 |
|
|
$ |
70,704 |
|
$ |
3,119 |
|
$ |
27,601 |
|
|
$ |
10,886 |
|
|
$ |
0.14 |
|
Non-GAAP
margin |
|
74.0 |
% |
|
|
|
|
|
|
20.1 |
% |
|
|
|
|
|
Non-GAAP Gross Margin |
|
Non-GAAP Operating Expenses |
|
Non-GAAP R&D |
|
Non-GAAP Operating Income |
|
Non-GAAP Net Income |
|
Adjusted EPS Continuing Operations |
Three Months Ended
July 2, 2022 |
Gross Profit |
|
Operating Expenses(a) |
|
R&D |
|
Operating Loss |
|
Net Loss Continuing Operations |
|
EPS from Continuing
Operations(j) |
Reported GAAP measure |
$ |
96,654 |
|
|
$ |
93,596 |
|
$ |
6,366 |
|
$ |
(3,308 |
) |
|
$ |
(7,734 |
) |
|
$ |
(0.11 |
) |
Reported GAAP
margin |
|
68.9 |
% |
|
|
|
|
|
(2.4)% |
|
|
|
|
Depreciation and
amortization(b) |
|
9,684 |
|
|
|
2,694 |
|
|
6 |
|
|
12,384 |
|
|
|
12,384 |
|
|
|
0.16 |
|
Acquisition and related
costs(c) |
|
1,402 |
|
|
|
4,592 |
|
|
— |
|
|
5,994 |
|
|
|
5,994 |
|
|
|
0.08 |
|
Restructuring and succession
charges(d) |
|
— |
|
|
|
1,695 |
|
|
— |
|
|
1,695 |
|
|
|
1,695 |
|
|
|
0.02 |
|
Other items(h) |
|
— |
|
|
|
768 |
|
|
784 |
|
|
1,552 |
|
|
|
1,552 |
|
|
|
0.02 |
|
Tax effect of adjusting
items(i) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
|
|
|
(5,370 |
) |
|
|
(0.07 |
) |
Non-GAAP
measure |
$ |
107,740 |
|
|
$ |
83,847 |
|
$ |
5,576 |
|
$ |
18,317 |
|
|
$ |
8,521 |
|
|
$ |
0.10 |
|
Non-GAAP
margin |
|
76.8 |
% |
|
|
|
|
|
|
13.1 |
% |
|
|
|
|
|
Non-GAAP Gross Margin |
|
Non-GAAP Operating Expenses |
|
Non-GAAP R&D |
|
Non-GAAP Operating Income |
|
Non-GAAP Net Income |
|
Adjusted EPS Continuing Operations |
Six Months Ended July
1, 2023 |
Gross Profit |
|
Operating Expenses(a) |
|
R&D |
|
Operating Loss |
|
Net Loss Continuing Operations |
|
EPS from Continuing
Operations(j) |
Reported GAAP measure |
$ |
163,042 |
|
|
$ |
241,181 |
|
$ |
7,169 |
|
$ |
(85,308 |
) |
|
$ |
(104,749 |
) |
|
$ |
(1.34 |
) |
Reported GAAP
margin |
|
63.7 |
% |
|
|
|
|
|
|
(33.3 |
%) |
|
|
|
|
Depreciation and
amortization(b) |
|
26,640 |
|
|
|
4,423 |
|
|
10 |
|
|
31,073 |
|
|
|
31,073 |
|
|
|
0.40 |
|
Acquisition and related
costs(c) |
|
— |
|
|
|
2,623 |
|
|
— |
|
|
2,623 |
|
|
|
2,623 |
|
|
|
0.03 |
|
Restructuring and succession
charges(d) |
|
— |
|
|
|
937 |
|
|
— |
|
|
937 |
|
|
|
937 |
|
|
|
0.01 |
|
Impairment of assets(e) |
|
— |
|
|
|
78,615 |
|
|
— |
|
|
78,615 |
|
|
|
78,615 |
|
|
|
1.01 |
|
Financial restructuring
costs(f) |
|
— |
|
|
|
6,587 |
|
|
— |
|
|
6,587 |
|
|
|
6,587 |
|
|
|
0.08 |
|
Loss on disposal of a
business(g) |
|
— |
|
|
|
977 |
|
|
— |
|
|
977 |
|
|
|
977 |
|
|
|
0.01 |
|
Other items(h) |
|
— |
|
|
|
4,460 |
|
|
1,154 |
|
|
5,614 |
|
|
|
5,614 |
|
|
|
0.07 |
|
Tax effect of adjusting
items(i) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
|
|
|
(27,278 |
) |
|
|
(0.40 |
) |
Non-GAAP
measure |
$ |
189,682 |
|
|
$ |
142,559 |
|
$ |
6,005 |
|
$ |
41,118 |
|
|
$ |
(5,601 |
) |
|
$ |
(0.13 |
) |
Non-GAAP
margin |
|
74.1 |
% |
|
|
|
|
|
|
16.1 |
% |
|
|
|
|
|
Non-GAAP Gross Margin |
|
Non-GAAP Operating Expenses |
|
Non-GAAP R&D |
|
Non-GAAP Operating Income |
|
Non-GAAP Net income Continuing Operations |
|
Adjusted EPS Continuing Operations |
Six Months Ended July
2, 2022 |
Gross Profit |
|
Operating Expenses(a) |
|
R&D |
|
Operating Loss |
|
Net Loss Continuing Operations |
|
EPS from Continuing
Operations(j) |
Reported GAAP measure |
$ |
172,356 |
|
|
$ |
183,820 |
|
$ |
13,294 |
|
$ |
(24,758 |
) |
|
$ |
(22,139 |
) |
|
$ |
(0.29 |
) |
Reported GAAP
margin |
|
66.9 |
% |
|
|
|
|
|
|
(9.6 |
%) |
|
|
|
|
Depreciation and
amortization(b) |
|
18,902 |
|
|
|
5,950 |
|
|
11 |
|
|
24,863 |
|
|
|
24,863 |
|
|
|
0.32 |
|
Acquisition and related
costs(c) |
|
5,607 |
|
|
|
8,365 |
|
|
— |
|
|
13,972 |
|
|
|
13,972 |
|
|
|
0.18 |
|
Restructuring and succession
charges(d) |
|
— |
|
|
|
2,272 |
|
|
— |
|
|
2,272 |
|
|
|
2,272 |
|
|
|
0.03 |
|
Other items(h) |
|
— |
|
|
|
3,104 |
|
|
784 |
|
|
3,888 |
|
|
|
3,888 |
|
|
|
0.05 |
|
Tax effect of adjusting
items(i) |
|
— |
|
|
|
— |
|
|
— |
|
|
— |
|
|
|
(11,173 |
) |
|
|
(0.14 |
) |
Non-GAAP
measure |
$ |
196,865 |
|
|
$ |
164,129 |
|
$ |
12,499 |
|
$ |
20,237 |
|
|
$ |
11,683 |
|
|
$ |
0.15 |
|
Non-GAAP
margin |
|
76.4 |
% |
|
|
|
|
|
|
7.9 |
% |
|
|
|
|
|
Non-GAAP Gross Margin |
|
Non-GAAP Operating Expenses |
|
Non-GAAP R&D |
|
Non-GAAP Operating Income |
|
Non-GAAP Net Income Continuing Operations |
|
Adjusted EPS Continuing Operations |
(a) |
The "Reported
GAAP Measure" under the "Operating Expenses" column is a sum of all
GAAP operating expense line items, excluding research and
development. |
|
|
(b) |
Includes for the three months ended July 1, 2023 and
July 2, 2022 and the six months ended July 1, 2023 and
July 2, 2022, respectively, depreciation and amortization of
$12,301, $9,684, $26,640 and $18,902 in cost of sales and $2,299,
$2,700, $4,433 and $5,961 in operating expenses presented in the
consolidated statements of operations and comprehensive loss. |
|
|
(c) |
Includes acquisition and integration costs related to completed
acquisitions, amortization of inventory step-up associated with
acquired entities, and changes in fair value of contingent
consideration. |
|
|
(d) |
Costs incurred were the result of adopting restructuring plans
to reduce headcount, reorganize management structure, and to
consolidate certain facilities. |
|
|
(e) |
Represents a non-cash impairment charge for intangible assets
attributable to our Wound Business due to our decision to divest
the business. |
|
|
(f) |
Financial restructuring costs which include advisory fees and
debt amendment related costs. |
|
|
(g) |
Represents the loss on disposal of the Wound Business. |
|
|
(h) |
Other items primarily includes charges associated with
strategic transactions, such as potential acquisitions or potential
divestitures, incremental one-time consulting costs related to the
recertification of certain products to comply with the new and
extensive EU MDR requirements and MOTYS Costs. Other items for
three and six months ended July 1, 2023 also includes
severance costs totaling $2.3 million and the reversal of equity
compensation expenses totaling $3.8 million related to the
transition of our executive leadership. |
|
|
(i) |
Includes $15.3 million of tax impact related to the
impairment of assets, and an estimated tax impact of the remaining
adjustments to Non-GAAP Net Income from continuing operations,
calculated by applying a rate of 25.1% and 24.8% to those
adjustments for the three and six months ended July 1, 2023
and July 2, 2022, respectively. |
|
|
(j) |
Adjustments are pro-rated to exclude the weighted average
non-controlling interest ownership of 20.1% and 20.4%,
respectively, for the three and three and six months ended
July 1, 2023 and July 2, 2022. |
Investor Inquiries and Media:
Dave CrawfordBioventusinvestor.relations@bioventus.com
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