Globus Medical, Inc. (NYSE:GMED), a leading musculoskeletal
solutions company, today announced its financial results for the
fourth quarter and year ended December 31, 2019.
Fourth Quarter:
- Worldwide sales increased 8.0% as reported to $211.7
million
- Fourth quarter net income was $45.5 million, or 21.5% of
sales
- Diluted EPS were $0.44
- Non-GAAP diluted EPS were $0.49
- Non-GAAP adjusted EBITDA was 34.3% of sales.
Full Year 2019:
- Worldwide sales increased 10.2% as reported to $785.4
million
- Net income for the year was $155.2 million, or 19.8% of
sales
- Diluted EPS were $1.52
- Non-GAAP diluted EPS were $1.68
- Non-GAAP adjusted EBITDA was 32.8% of sales.
“Globus Medical capped off a great 2019
performance with strong fourth quarter results. Full year revenue
was a record $785.4 million, representing a 10.2% increase over
2018, our third consecutive year of double digit growth,” said Dave
Demski, CEO. “Our organic growth rate in Spine sales far exceeded
the market and was the highest among the top 6 spinal implant
competitors. We sustained a strong finish in Enabling
Technologies, demonstrating our ability to compete effectively
against much larger players. We showed significant
improvement in adjusted EBITDA, as our second half adjusted EBITDA
reached 33.9%, despite heavy investments in INR and Trauma. We
launched 17 new products across Spine and Trauma in 2019 and
completed significant work on several exciting enhancements to our
INR portfolio that are expected to launch in 2020.”
Full year 2019 sales were $785.4 million,
a 10.2% increase over 2018, and non-GAAP diluted EPS
was $1.68. Worldwide sales for the fourth quarter
were $211.7 million,
an increase of 8.0% over the fourth quarter of
2018. Revenue from Enabling Technology was primarily due to
continued demand for the ExcelsiusGPS® robotics and
navigation system.
Fourth quarter sales in the U.S., including
robotics, increased by 8.3% compared to the fourth
quarter of 2018. International sales increased
by 6.4% over the fourth quarter of 2018 on an as-reported
basis and 6.2% on a constant currency basis.
Fourth quarter GAAP net income was $45.5
million, an increase of 23.9% over the same period last
year. Diluted EPS for the fourth quarter was $0.44, as
compared to $0.36 for the fourth quarter 2018. Non-GAAP
diluted EPS for the fourth quarter was $0.49, compared
to $0.43 in the fourth quarter of 2018, an increase of
12.3%.
The company generated net cash provided by
operating activities of $172.0 million and non-GAAP free
cash flow of $101.2 million in 2019. The Company ended
the year with cash, cash equivalents and marketable securities
of $721.0 million. The company remains debt free.
2020 Annual
Guidance
The Company today confirmed full year 2020
guidance with expected sales of $850 million and non-GAAP diluted
earnings per share of $1.82.
Conference Call Information
Globus Medical will hold a teleconference to
discuss its 2019 fourth quarter and full year results with the
investment community at 4:30 p.m. Eastern Time today. Globus
invites all interested parties to join the call by dialing:
1-855-533-7141 United
States Participants1-720-545-0060
International ParticipantsThere is no pass code for the
teleconference.
For interested parties who do not wish to ask
questions, the teleconference will be webcast live and may be
accessed through a link on the Globus Medical website at
www.globusmedical.com/investors.
The call will be archived until Thursday,
February 27, 2020. The audio archive can be accessed by calling
1-855-859-2056 in the U.S. or 1-404-537-3406 from outside the U.S.
The passcode for the audio replay is 377-7276.
About Globus Medical, Inc.
Based in Audubon, Pennsylvania, Globus Medical,
Inc. was founded in 2003 by an experienced team of professionals
with a shared vision to create products that enable surgeons to
promote healing in patients with musculoskeletal disorders.
Additional information can be accessed at
www.globusmedical.com.
Non-GAAP Financial Measures
To supplement our financial statements prepared
in accordance with U.S. generally accepted accounting principles
(“U.S. GAAP”), management uses certain non-GAAP financial
measures. For example, non-GAAP adjusted EBITDA, which
represents net income before interest income, net and other
non-operating expenses, provision for income taxes, depreciation
and amortization, stock-based compensation, provisions for
litigation, and acquisition related costs/licensing, and net gain
from the sale of assets, is useful as an additional measure of
operating performance, and particularly as a measure of comparative
operating performance from period to period, as it is reflective of
changes in pricing decisions, cost controls and other factors that
affect operating performance, and it removes the effect of our
capital structure, asset base, income taxes and interest income and
expense. Our management also uses non-GAAP adjusted EBITDA
for planning purposes, including the preparation of our annual
operating budget and financial projections. Provision for
litigation represents costs incurred for litigation settlements or
unfavorable verdicts when the loss is known or considered probable
and the amount can be reasonably estimated, or in the case of a
favorable settlement, when income is realized. Acquisition related
costs/licensing represents the change in fair value of business
acquisition related contingent consideration; costs related to
integrating recently acquired businesses including but not limited
to costs to exit or convert contractual obligations, severance, and
information system conversion; and specific costs related to the
consummation of the acquisition process such as banker fees, legal
fees, and other acquisition related professional fees, as well as
one-time licensing fees. Net gain from sale of assets represents
the gain on sale of assets and the offsetting impact of costs
incurred through the sale.
In addition, for the period ended
December 31, 2019 and for other comparative periods, we are
presenting non-GAAP net income and non-GAAP diluted earnings per
share, which represent net income and diluted earnings per share
excluding the provision for litigation, amortization of
intangibles, acquisition related costs/licensing, net gain from the
sale of assets, impacts of the U.S. Tax Reform Act and the tax
effects of such adjustments. We believe these non-GAAP
measures are also useful indicators of our operating performance,
and particularly as additional measures of comparative operating
performance from period to period as they remove the effects of
litigation, amortization of intangibles, acquisition related
costs/licensing, net gain from the sale of assets and the tax
effects of such adjustments, which we believe are not reflective of
underlying business trends. Additionally, for the periods
ended December 31, 2019 and for other comparative periods, we
also define the non-GAAP measure of free cash flow as the net cash
provided by operating activities, adjusted for the impact of
restricted cash, less the cash impact of purchases of property and
equipment. We believe that this financial measure provides
meaningful information for evaluating our overall financial
performance for comparative periods as it facilitates an assessment
of funds available to satisfy current and future obligations and
fund acquisitions. Furthermore, the non-GAAP measure of
constant currency sales growth is calculated by translating current
year sales at the same average exchange rates in effect during the
applicable prior year period. We believe constant currency
sales growth provides insight to the comparative increase or
decrease in period sales, in dollar and percentage terms, excluding
the effects of fluctuations in foreign currency exchange rates.
Non-GAAP adjusted EBITDA, non-GAAP net income,
non-GAAP diluted earnings per share, free cash flow and constant
currency sales growth are not calculated in conformity with U.S.
GAAP. Non-GAAP financial measures have limitations as
analytical tools and should not be considered in isolation or as a
substitute for financial measures prepared in accordance with U.S.
GAAP. These measures do not include certain expenses that may
be necessary to evaluate our liquidity or operating results.
Our definitions of non-GAAP adjusted EBITDA, non-GAAP net income,
non-GAAP diluted earnings per share, free cash flow and constant
currency sales growth may differ from that of other companies and
therefore may not be comparable.
Safe Harbor Statements
All statements included in this press release
other than statements of historical fact are forward-looking
statements and may be identified by their use of words such as
“believe,” “may,” “might,” “could,” “will,” “aim,” “estimate,”
“continue,” “anticipate,” “intend,” “expect,” “plan” and other
similar terms. These forward-looking statements are based on
our current assumptions, expectations and estimates of future
events and trends. Forward-looking statements are only
predictions and are subject to many risks, uncertainties and other
factors that may affect our businesses and operations and could
cause actual results to differ materially from those
predicted. These risks and uncertainties include, but are not
limited to, factors affecting our quarterly results, our ability to
manage our growth, our ability to sustain our profitability, demand
for our products, our ability to compete successfully (including
without limitation our ability to convince surgeons to use our
products and our ability to attract and retain sales and other
personnel), our ability to rapidly develop and introduce new
products, our ability to develop and execute on successful business
strategies, our ability to successfully integrate the international
operations acquired from Alphatec, both in general and on our
anticipated timeline, our ability to transition Alphatec’s
international customers to Globus products, our ability to realize
the expected benefits to our results from the Alphatec acquisition,
our ability to comply with laws and regulations that are or may
become applicable to our businesses, our ability to safeguard our
intellectual property, our success in defending legal proceedings
brought against us, trends in the medical device industry, general
economic conditions, and other risks. For a discussion of
these and other risks, uncertainties and other factors that could
affect our results, you should refer to the disclosure contained in
our most recent annual report on Form 10-K filed with the
Securities and Exchange Commission, including the sections labeled
“Risk Factors” and “Cautionary Note Concerning Forward-Looking
Statements,” and in our Forms 10-Q, Forms 8-K and other filings
with the Securities and Exchange Commission. These documents
are available at www.sec.gov. Moreover, we operate in an
evolving environment. New risk factors and uncertainties
emerge from time to time and it is not possible for us to predict
all risk factors and uncertainties, nor can we assess the impact of
all factors on our business or the extent to which any factor, or
combination of factors, may cause actual results to differ
materially from those contained in any forward-looking
statements. Given these risks and uncertainties, readers are
cautioned not to place undue reliance on any forward-looking
statements. Forward-looking statements contained in this
press release speak only as of the date of this press
release. We undertake no obligation to update any
forward-looking statements as a result of new information, events
or circumstances or other factors arising or coming to our
attention after the date hereof.
|
GLOBUS MEDICAL, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
INCOME(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
December 31, |
(In thousands, except
per share amounts) |
2019 |
|
2018 |
|
2017 |
|
2019 |
|
2018 |
|
2017 |
Sales |
$ |
211,667 |
|
|
$ |
195,938 |
|
|
$ |
176,034 |
|
|
$ |
785,368 |
|
|
$ |
712,969 |
|
|
$ |
635,977 |
|
Cost of goods sold |
|
48,760 |
|
|
|
45,954 |
|
|
|
40,856 |
|
|
|
179,975 |
|
|
|
159,410 |
|
|
|
150,453 |
|
Gross profit |
|
162,907 |
|
|
|
149,984 |
|
|
|
135,178 |
|
|
|
605,393 |
|
|
|
553,559 |
|
|
|
485,524 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
15,496 |
|
|
|
13,758 |
|
|
|
11,413 |
|
|
|
60,073 |
|
|
|
55,496 |
|
|
|
43,679 |
|
Selling, general and administrative |
|
92,138 |
|
|
|
83,642 |
|
|
|
72,958 |
|
|
|
354,757 |
|
|
|
311,591 |
|
|
|
267,817 |
|
Provision for litigation |
|
565 |
|
|
|
5,878 |
|
|
|
(112 |
) |
|
|
2,190 |
|
|
|
5,878 |
|
|
|
2,668 |
|
Amortization of intangibles |
|
3,397 |
|
|
|
3,063 |
|
|
|
2,238 |
|
|
|
13,809 |
|
|
|
9,588 |
|
|
|
7,909 |
|
Acquisition related costs |
|
1,331 |
|
|
|
392 |
|
|
|
321 |
|
|
|
2,575 |
|
|
|
1,681 |
|
|
|
1,611 |
|
Total operating expenses |
|
112,927 |
|
|
|
106,733 |
|
|
|
86,818 |
|
|
|
433,404 |
|
|
|
384,234 |
|
|
|
323,684 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
49,980 |
|
|
|
43,251 |
|
|
|
48,360 |
|
|
|
171,989 |
|
|
|
169,325 |
|
|
|
161,840 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income,
net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income/(expense), net |
|
4,452 |
|
|
|
4,167 |
|
|
|
1,863 |
|
|
|
17,406 |
|
|
|
13,278 |
|
|
|
6,608 |
|
Foreign currency transaction gain/(loss) |
|
(48 |
) |
|
|
47 |
|
|
|
227 |
|
|
|
75 |
|
|
|
360 |
|
|
|
909 |
|
Other income/(expense) |
|
66 |
|
|
|
162 |
|
|
|
150 |
|
|
|
476 |
|
|
|
5,642 |
|
|
|
571 |
|
Total other income/(expense), net |
|
4,470 |
|
|
|
4,376 |
|
|
|
2,240 |
|
|
|
17,957 |
|
|
|
19,280 |
|
|
|
8,088 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
54,450 |
|
|
|
47,627 |
|
|
|
50,600 |
|
|
|
189,946 |
|
|
|
188,605 |
|
|
|
169,928 |
|
Income tax provision |
|
8,920 |
|
|
|
10,876 |
|
|
|
26,224 |
|
|
|
34,736 |
|
|
|
32,131 |
|
|
|
62,580 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
$ |
45,530 |
|
|
$ |
36,751 |
|
|
$ |
24,376 |
|
|
$ |
155,210 |
|
|
$ |
156,474 |
|
|
$ |
107,348 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.46 |
|
|
$ |
0.37 |
|
|
$ |
0.25 |
|
|
$ |
1.57 |
|
|
$ |
1.60 |
|
|
$ |
1.12 |
|
Diluted |
$ |
0.44 |
|
|
$ |
0.36 |
|
|
$ |
0.25 |
|
|
$ |
1.52 |
|
|
$ |
1.54 |
|
|
$ |
1.10 |
|
Weighted average
shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
99,601 |
|
|
|
98,516 |
|
|
|
96,489 |
|
|
|
99,150 |
|
|
|
97,884 |
|
|
|
96,243 |
|
Diluted |
|
102,933 |
|
|
|
101,627 |
|
|
|
98,726 |
|
|
|
101,998 |
|
|
|
101,316 |
|
|
|
97,887 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GLOBUS MEDICAL, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE
SHEETS(unaudited) |
|
|
|
|
|
|
|
|
|
December 31, |
(In thousands, except
par value) |
|
2019 |
|
2018 |
ASSETS |
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
Cash, cash equivalents, and restricted cash |
|
$ |
195,724 |
|
|
$ |
139,747 |
|
Short-term marketable
securities |
|
|
115,763 |
|
|
|
199,937 |
|
Accounts receivable, net of
allowances of $5,599 and $4,226, respectively |
|
|
154,326 |
|
|
|
137,067 |
|
Inventories |
|
|
196,314 |
|
|
|
131,254 |
|
Prepaid expenses and other
current assets |
|
|
17,243 |
|
|
|
15,387 |
|
Income taxes receivable |
|
|
8,098 |
|
|
|
7,289 |
|
Total current assets |
|
|
687,468 |
|
|
|
630,681 |
|
Property and equipment, net of
accumulated depreciation of $243,732 and $216,809,
respectively |
|
|
199,841 |
|
|
|
171,873 |
|
Long-term marketable
securities |
|
|
409,514 |
|
|
|
263,117 |
|
Intangible assets, net |
|
|
78,812 |
|
|
|
87,323 |
|
Goodwill |
|
|
128,775 |
|
|
|
123,734 |
|
Other assets |
|
|
21,741 |
|
|
|
10,364 |
|
Deferred income taxes |
|
|
5,926 |
|
|
|
13,578 |
|
Total assets |
|
$ |
1,532,077 |
|
|
$ |
1,300,670 |
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
Accounts payable |
|
$ |
24,614 |
|
|
$ |
25,895 |
|
Accrued expenses |
|
|
63,283 |
|
|
|
59,878 |
|
Income taxes payable |
|
|
1,057 |
|
|
|
917 |
|
Business acquisition
liabilities |
|
|
6,727 |
|
|
|
6,830 |
|
Deferred revenue |
|
|
5,402 |
|
|
|
2,598 |
|
Payable to broker |
|
|
10,320 |
|
|
|
- |
|
Total current liabilities |
|
|
111,403 |
|
|
|
96,118 |
|
Business acquisition
liabilities, net of current portion |
|
|
2,822 |
|
|
|
3,288 |
|
Deferred income taxes |
|
|
6,023 |
|
|
|
8,114 |
|
Other liabilities |
|
|
9,377 |
|
|
|
7,634 |
|
Total liabilities |
|
|
129,625 |
|
|
|
115,154 |
|
Commitments and
contingencies |
|
|
|
|
|
|
Equity: |
|
|
|
|
|
|
Class A common stock; $0.001
par value. Authorized 500,000 shares; issued and outstanding
77,395 and 76,143 shares at December 31, 2019 and
December 31, 2018, respectively |
|
|
77 |
|
|
|
76 |
|
Class B common stock; $0.001
par value. Authorized 275,000 shares; issued and outstanding
22,430 and 22,430 shares at December 31, 2019 and
December 31, 2018, respectively |
|
|
22 |
|
|
|
22 |
|
Additional paid-in
capital |
|
|
357,320 |
|
|
|
299,869 |
|
Accumulated other
comprehensive loss |
|
|
(2,898 |
) |
|
|
(7,172 |
) |
Retained earnings |
|
|
1,047,931 |
|
|
|
892,721 |
|
Total equity |
|
|
1,402,452 |
|
|
|
1,185,516 |
|
Total liabilities and equity |
|
$ |
1,532,077 |
|
|
$ |
1,300,670 |
|
|
|
|
|
|
|
|
|
|
|
GLOBUS MEDICAL, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
|
December 31, |
(In
thousands) |
|
2019 |
|
2018 |
|
2017 |
Cash flows from
operating activities: |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
155,210 |
|
|
$ |
156,474 |
|
|
$ |
107,348 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
52,734 |
|
|
|
41,630 |
|
|
|
42,067 |
|
Amortization of premium (discount) on marketable securities |
|
|
(1,089 |
) |
|
|
1,677 |
|
|
|
2,671 |
|
Write-down for excess and obsolete inventories, net |
|
|
2,498 |
|
|
|
10,475 |
|
|
|
11,519 |
|
Stock-based compensation expense |
|
|
26,085 |
|
|
|
21,899 |
|
|
|
14,686 |
|
Allowance for doubtful accounts |
|
|
3,026 |
|
|
|
957 |
|
|
|
1,718 |
|
Change in fair value of business acquisition liabilities |
|
|
1,787 |
|
|
|
985 |
|
|
|
1,240 |
|
Impairment of intangible assets |
|
|
|
|
|
— |
|
|
|
516 |
|
Change in deferred income taxes |
|
|
4,302 |
|
|
|
971 |
|
|
|
8,292 |
|
(Gain)/loss on disposal of assets, net |
|
|
866 |
|
|
|
(3,557 |
) |
|
|
— |
|
(Increase)/decrease in: |
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(18,306 |
) |
|
|
(21,789 |
) |
|
|
(24,955 |
) |
Inventories |
|
|
(50,018 |
) |
|
|
(31,382 |
) |
|
|
(5,277 |
) |
Prepaid expenses and other assets |
|
|
(12,263 |
) |
|
|
(7,496 |
) |
|
|
(4,774 |
) |
Increase/(decrease) in: |
|
|
|
|
|
|
|
|
|
Accounts payable |
|
|
773 |
|
|
|
(3,008 |
) |
|
|
9,843 |
|
Accrued expenses and other liabilities |
|
|
7,043 |
|
|
|
14,728 |
|
|
|
(2,064 |
) |
Income taxes payable/receivable |
|
|
(673 |
) |
|
|
(921 |
) |
|
|
(3,772 |
) |
Net cash provided by
operating activities |
|
|
171,975 |
|
|
|
181,643 |
|
|
|
159,058 |
|
Cash flows from
investing activities: |
|
|
|
|
|
|
|
|
|
Purchases of marketable securities |
|
|
(346,526 |
) |
|
|
(537,942 |
) |
|
|
(392,895 |
) |
Maturities of marketable securities |
|
|
247,008 |
|
|
|
278,049 |
|
|
|
240,353 |
|
Sales of marketable securities |
|
|
53,786 |
|
|
|
106,388 |
|
|
|
122,512 |
|
Purchases of property and equipment |
|
|
(70,750 |
) |
|
|
(59,697 |
) |
|
|
(51,303 |
) |
Collections/(issuance) of note receivable |
|
|
|
|
|
30,000 |
|
|
|
— |
|
Proceeds from sale of assets |
|
|
— |
|
|
|
5,000 |
|
|
|
— |
|
Acquisition of businesses, net of cash acquired and purchases of
intangible and other assets |
|
|
(23,799 |
) |
|
|
(14,825 |
) |
|
|
(29,944 |
) |
Net cash used in
investing activities |
|
|
(140,281 |
) |
|
|
(193,027 |
) |
|
|
(111,277 |
) |
Cash flows from
financing activities: |
|
|
|
|
|
|
|
|
|
Payment of business acquisition liabilities |
|
|
(6,597 |
) |
|
|
(6,739 |
) |
|
|
(10,109 |
) |
Proceeds from exercise of stock options |
|
|
31,036 |
|
|
|
39,309 |
|
|
|
11,735 |
|
Net cash provided by
financing activities |
|
|
24,439 |
|
|
|
32,570 |
|
|
|
1,626 |
|
Effect of foreign exchange
rate on cash |
|
|
(156 |
) |
|
|
(256 |
) |
|
|
1,979 |
|
Net increase in cash,
cash equivalents, and restricted cash |
|
|
55,977 |
|
|
|
20,930 |
|
|
|
51,386 |
|
Cash, cash equivalents, and
restricted cash at beginning of period |
|
|
139,747 |
|
|
|
118,817 |
|
|
|
67,431 |
|
Cash, cash
equivalents, and restricted cash at end of period |
|
$ |
195,724 |
|
|
$ |
139,747 |
|
|
$ |
118,817 |
|
Supplemental disclosures of
cash flow information: |
|
|
|
|
|
|
|
|
|
Interest paid |
|
|
79 |
|
|
|
6 |
|
|
|
3 |
|
Income taxes paid |
|
$ |
34,139 |
|
|
$ |
30,552 |
|
|
$ |
59,111 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Financial Information |
|
|
Sales by Geographic Area: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
|
December 31, |
|
December 31, |
(In
thousands) |
|
2019 |
|
2018 |
|
2017 |
|
2019 |
|
2018 |
|
2017 |
United States |
|
$ |
177,459 |
|
|
$ |
163,788 |
|
|
$ |
148,012 |
|
|
$ |
647,683 |
|
|
$ |
593,878 |
|
|
$ |
529,882 |
|
International |
|
|
34,208 |
|
|
|
32,150 |
|
|
|
28,022 |
|
|
|
137,685 |
|
|
|
119,091 |
|
|
|
106,095 |
|
Total Sales |
|
$ |
211,667 |
|
|
$ |
195,938 |
|
|
$ |
176,034 |
|
|
$ |
785,368 |
|
|
$ |
712,969 |
|
|
$ |
635,977 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales by Revenue Stream: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
|
December 31, |
|
December 31, |
(In
thousands) |
|
2019 |
|
2018 |
|
2017 |
|
2019 |
|
2018 |
|
2017 |
Musculoskeletal Solutions
products |
|
$ |
197,757 |
|
|
$ |
181,638 |
|
|
$ |
165,114 |
|
|
$ |
738,377 |
|
|
$ |
666,040 |
|
|
$ |
625,057 |
|
Enabling Technologies
products |
|
|
13,910 |
|
|
|
14,300 |
|
|
|
10,920 |
|
|
|
46,991 |
|
|
|
46,929 |
|
|
|
10,920 |
|
Total Sales |
|
$ |
211,667 |
|
|
$ |
195,938 |
|
|
$ |
176,034 |
|
|
$ |
785,368 |
|
|
$ |
712,969 |
|
|
$ |
635,977 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidity and Capital Resources: |
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
December 31, |
(In
thousands) |
|
2019 |
|
2018 |
Cash, cash equivalents, and
restricted cash |
|
$ |
195,724 |
|
|
$ |
139,747 |
|
Short-term marketable
securities |
|
|
115,763 |
|
|
|
199,937 |
|
Long-term marketable
securities |
|
|
409,514 |
|
|
|
263,117 |
|
Total cash, cash equivalents,
restricted cash and marketable securities |
|
$ |
721,001 |
|
|
$ |
602,801 |
|
|
|
|
|
|
|
|
|
|
The following tables reconcile GAAP to Non-GAAP
financial measures.
|
Non-GAAP Adjusted EBITDA Reconciliation
Table: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
December 31, |
(In thousands, except
percentages) |
2019 |
|
2018 |
|
2017 |
|
2019 |
|
2018 |
|
2017 |
Net income |
$ |
45,529 |
|
|
$ |
36,751 |
|
|
$ |
24,376 |
|
|
$ |
155,210 |
|
|
$ |
156,474 |
|
|
$ |
107,348 |
|
Interest income, net |
|
(4,452 |
) |
|
|
(4,164 |
) |
|
|
(1,862 |
) |
|
|
(17,406 |
) |
|
|
(13,278 |
) |
|
|
(6,608 |
) |
Provision for income
taxes |
|
8,920 |
|
|
|
10,876 |
|
|
|
26,224 |
|
|
|
34,736 |
|
|
|
32,131 |
|
|
|
62,580 |
|
Depreciation and
amortization |
|
14,046 |
|
|
|
11,936 |
|
|
|
8,294 |
|
|
|
52,734 |
|
|
|
41,630 |
|
|
|
42,067 |
|
EBITDA |
|
64,043 |
|
|
|
55,399 |
|
|
|
57,032 |
|
|
|
225,274 |
|
|
|
216,957 |
|
|
|
205,387 |
|
Stock-based compensation
expense |
|
6,437 |
|
|
|
4,821 |
|
|
|
4,027 |
|
|
|
26,085 |
|
|
|
21,899 |
|
|
|
14,686 |
|
Provision for litigation |
|
565 |
|
|
|
5,878 |
|
|
|
(112 |
) |
|
|
2,190 |
|
|
|
5,878 |
|
|
|
2,668 |
|
Acquisition related
costs/licensing |
|
1,652 |
|
|
|
641 |
|
|
|
553 |
|
|
|
3,664 |
|
|
|
4,488 |
|
|
|
3,391 |
|
Net (gain) loss from sale of
assets |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3,593 |
) |
|
|
— |
|
Adjusted EBITDA |
$ |
72,697 |
|
|
$ |
66,739 |
|
|
$ |
61,500 |
|
|
$ |
257,213 |
|
|
$ |
245,629 |
|
|
$ |
226,132 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income as a
percentage of sales |
|
21.5 |
% |
|
|
18.8 |
% |
|
|
13.8 |
% |
|
|
19.8 |
% |
|
|
21.9 |
% |
|
|
16.9 |
% |
Adjusted EBITDA as a
percentage of sales |
|
34.3 |
% |
|
|
34.1 |
% |
|
|
34.9 |
% |
|
|
32.8 |
% |
|
|
34.5 |
% |
|
|
35.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net Income Reconciliation Table: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
December 31, |
(In
thousands) |
2019 |
|
2018 |
|
2017 |
|
2019 |
|
2018 |
|
2017 |
Net income |
$ |
45,529 |
|
|
$ |
36,751 |
|
|
$ |
24,376 |
|
|
$ |
155,210 |
|
|
$ |
156,474 |
|
|
$ |
107,348 |
|
Provision for litigation |
|
565 |
|
|
|
5,878 |
|
|
|
(112 |
) |
|
|
2,190 |
|
|
|
5,878 |
|
|
|
2,668 |
|
Amortization of
intangibles |
|
3,397 |
|
|
|
3,063 |
|
|
|
2,238 |
|
|
|
13,809 |
|
|
|
9,588 |
|
|
|
7,909 |
|
Acquisition related
costs/licensing |
|
1,652 |
|
|
|
641 |
|
|
|
553 |
|
|
|
3,664 |
|
|
|
4,488 |
|
|
|
3,391 |
|
Net (gain) loss from sale of
assets |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3,593 |
) |
|
|
— |
|
Tax reform impact |
|
— |
|
|
|
— |
|
|
|
11,014 |
|
|
|
— |
|
|
|
— |
|
|
|
11,014 |
|
Tax effect of adjusting
items |
|
(920 |
) |
|
|
(2,189 |
) |
|
|
(796 |
) |
|
|
(3,581 |
) |
|
|
(3,437 |
) |
|
|
(4,239 |
) |
Non-GAAP net income |
$ |
50,223 |
|
|
$ |
44,144 |
|
|
$ |
37,273 |
|
|
$ |
171,292 |
|
|
$ |
169,398 |
|
|
$ |
128,091 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Diluted Earnings Per Share Reconciliation
Table: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
December 31, |
(In
thousands) |
2019 |
|
2018 |
|
2017 |
|
2019 |
|
2018 |
|
2017 |
Diluted earnings per share, as reported |
$ |
0.44 |
|
|
$ |
0.36 |
|
|
$ |
0.25 |
|
|
$ |
1.52 |
|
|
$ |
1.54 |
|
|
$ |
1.10 |
|
Provision for litigation |
|
0.01 |
|
|
|
0.06 |
|
|
|
— |
|
|
|
0.02 |
|
|
|
0.06 |
|
|
|
0.03 |
|
Amortization of
intangibles |
|
0.03 |
|
|
|
0.03 |
|
|
|
0.02 |
|
|
|
0.14 |
|
|
|
0.09 |
|
|
|
0.08 |
|
Acquisition related
costs/licensing |
|
0.02 |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
|
0.04 |
|
|
|
0.05 |
|
|
|
0.03 |
|
Net (gain) loss from sale of
assets |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.04 |
) |
|
|
— |
|
Tax reform impact |
|
— |
|
|
|
— |
|
|
|
0.11 |
|
|
|
— |
|
|
|
— |
|
|
|
0.11 |
|
Tax effect of adjusting
items |
|
(0.01 |
) |
|
|
(0.02 |
) |
|
|
(0.01 |
) |
|
|
(0.04 |
) |
|
|
(0.03 |
) |
|
|
(0.04 |
) |
Non-GAAP diluted earnings per
share |
$ |
0.49 |
|
|
$ |
0.43 |
|
|
$ |
0.38 |
|
|
$ |
1.68 |
|
|
$ |
1.67 |
|
|
$ |
1.31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*amounts might not add due to rounding
|
Non-GAAP Free Cash Flow Reconciliation Table: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
December 31, |
(In
thousands) |
2019 |
|
2018 |
|
2017 |
|
2019 |
|
2018 |
|
2017 |
Net cash provided by operating activities |
$ |
54,266 |
|
|
$ |
44,291 |
|
|
$ |
44,837 |
|
|
$ |
171,975 |
|
|
$ |
181,643 |
|
|
$ |
159,058 |
|
Purchases of property and
equipment |
|
(15,793 |
) |
|
|
(17,159 |
) |
|
|
(13,425 |
) |
|
|
(70,750 |
) |
|
|
(59,697 |
) |
|
|
(51,303 |
) |
Free cash flow |
$ |
38,473 |
|
|
$ |
27,132 |
|
|
$ |
31,412 |
|
|
$ |
101,225 |
|
|
$ |
121,946 |
|
|
$ |
107,755 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Sales on a Constant Currency Basis Comparative
Table: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Reported |
|
Currency Impact on |
|
Constant Currency |
|
|
December 31, |
|
Sales |
|
Current |
|
Sales |
(In thousands, except
percentages) |
|
2019 |
|
2018 |
|
Growth |
|
Period Sales |
|
Growth |
United States |
|
$ |
177,459 |
|
|
$ |
163,788 |
|
|
8.3 |
% |
|
$ |
|
|
8.3 |
% |
International |
|
|
34,208 |
|
|
|
32,150 |
|
|
6.4 |
% |
|
|
(49 |
) |
|
6.2 |
% |
Total Sales |
|
$ |
211,667 |
|
|
$ |
195,938 |
|
|
8.0 |
% |
|
$ |
(49 |
) |
|
8.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
Reported |
|
Currency Impact on |
|
Constant Currency |
|
|
December 31, |
|
Sales |
|
Current |
|
Sales |
(In thousands, except
percentages) |
|
2019 |
|
2018 |
|
Growth |
|
Period Sales |
|
Growth |
United States |
|
$ |
647,683 |
|
|
$ |
593,878 |
|
|
9.1 |
% |
|
$ |
|
|
9.1 |
% |
International |
|
|
137,685 |
|
|
|
119,091 |
|
|
15.6 |
% |
|
|
2,359 |
|
|
17.6 |
% |
Total Sales |
|
$ |
785,368 |
|
|
$ |
712,969 |
|
|
10.2 |
% |
|
$ |
2,359 |
|
|
10.5 |
% |
|
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|
|
|
|
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|
|
|
|
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Contact:
Brian KearnsSenior Vice President, Business Development and
Investor RelationsPhone: (610) 930-1800Email:
investors@globusmedical.comwww.globusmedical.com
Globus Medical (NYSE:GMED)
Historical Stock Chart
From Aug 2024 to Sep 2024
Globus Medical (NYSE:GMED)
Historical Stock Chart
From Sep 2023 to Sep 2024