Delaware | 001-34634 | 33-0022692 | ||||||||||||
(State or other jurisdiction
of incorporation)
|
(Commission File Number) |
(IRS Employer
Identification No.)
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951 Calle Amanecer | , | San Clemente | , | California | 92673 | |||||||||||||||
(Address of principal executive offices) | (Zip Code) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): | ||||||||
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||||
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||||
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||||
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||
Common stock, par value $0.10 per share | ICUI | The Nasdaq Stock Market LLC | ||||||
(Global Select Market) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). | ||||||||||||||
Emerging growth company | ☐ | |||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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(d) | Exhibits | |||||||
Press release, dated May 7, 2024 announcing ICU Medical, Inc.'s first quarter 2024 earnings. | ||||||||
104 | Cover Page Interactive Data File (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) |
ICU MEDICAL, INC. | ||||||||||||||||||||
Date: May 7, 2024 | By: | /s/ Brian M. Bonnell | ||||||||||||||||||
Brian M. Bonnell | ||||||||||||||||||||
Chief Financial Officer and Treasurer |
Three months ended March 31, |
||||||||||||||||||||
Product Line | 2024 | 2023 | $ Change | |||||||||||||||||
Consumables | $ | 244.1 | $ | 236.1 | $ | 8.0 | ||||||||||||||
Infusion Systems | 157.3 | 161.7 | (4.4) | |||||||||||||||||
Vital Care* | 165.3 | 170.8 | (5.5) | |||||||||||||||||
Total** | $ | 566.7 | $ | 568.6 | $ | (1.9) |
March 31, 2024 |
December 31, 2023 |
||||||||||
ASSETS | |||||||||||
CURRENT ASSETS: | |||||||||||
Cash and cash equivalents | $ | 251,423 | $ | 254,222 | |||||||
Short-term investment securities | — | 501 | |||||||||
TOTAL CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENT SECURITIES | 251,423 | 254,723 | |||||||||
Accounts receivable, net of allowance for doubtful accounts | 145,186 | 161,566 | |||||||||
Inventories | 693,006 | 709,360 | |||||||||
Prepaid income taxes | 15,476 | 21,983 | |||||||||
Prepaid expenses and other current assets | 82,636 | 73,640 | |||||||||
TOTAL CURRENT ASSETS | 1,187,727 | 1,221,272 | |||||||||
PROPERTY, PLANT AND EQUIPMENT, net | 602,617 | 612,909 | |||||||||
OPERATING LEASE RIGHT-OF-USE ASSETS | 64,928 | 69,909 | |||||||||
GOODWILL | 1,459,368 | 1,472,446 | |||||||||
INTANGIBLE ASSETS, net | 836,904 | 870,588 | |||||||||
DEFERRED INCOME TAXES | 40,203 | 37,295 | |||||||||
OTHER ASSETS | 96,651 | 94,020 | |||||||||
TOTAL ASSETS | $ | 4,288,398 | $ | 4,378,439 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
CURRENT LIABILITIES: | |||||||||||
Accounts payable | $ | 152,480 | $ | 150,030 | |||||||
Accrued liabilities | 247,896 | 268,215 | |||||||||
Current portion of long-term debt | 51,000 | 51,000 | |||||||||
Income tax payable | 2,484 | 7,714 | |||||||||
Contingent earn-out liability | 1,500 | 4,879 | |||||||||
TOTAL CURRENT LIABILITIES | 455,360 | 481,838 | |||||||||
CONTINGENT EARN-OUT LIABILITY | 4,286 | 3,991 | |||||||||
LONG-TERM DEBT | 1,566,298 | 1,577,770 | |||||||||
OTHER LONG-TERM LIABILITIES | 102,594 | 100,497 | |||||||||
DEFERRED INCOME TAXES | 55,585 | 55,873 | |||||||||
INCOME TAX LIABILITY | 36,445 | 35,060 | |||||||||
COMMITMENTS AND CONTINGENCIES | — | — | |||||||||
STOCKHOLDERS’ EQUITY: | |||||||||||
Convertible preferred stock, $1.00 par value; Authorized — 500 shares; Issued and outstanding — none | — | — | |||||||||
Common stock, $0.10 par value; Authorized — 80,000 shares; Issued —24,412 and 24,144 shares at March 31, 2024 and December 31, 2023, respectively, and outstanding — 24,365 and 24,141 shares at March 31, 2024 and December 31, 2023, respectively | 2,441 | 2,414 | |||||||||
Additional paid-in capital | 1,371,244 | 1,366,493 | |||||||||
Treasury stock, at cost | (4,692) | (262) | |||||||||
Retained earnings | 768,375 | 807,846 | |||||||||
Accumulated other comprehensive loss | (69,538) | (53,081) | |||||||||
TOTAL STOCKHOLDERS' EQUITY | 2,067,830 | 2,123,410 | |||||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 4,288,398 | $ | 4,378,439 |
Three months ended March 31, |
|||||||||||
2024 | 2023 | ||||||||||
TOTAL REVENUES | $ | 566,655 | $ | 568,649 | |||||||
COST OF GOODS SOLD | 381,411 | 376,608 | |||||||||
GROSS PROFIT | 185,244 | 192,041 | |||||||||
OPERATING EXPENSES: | |||||||||||
Selling, general and administrative | 157,657 | 152,572 | |||||||||
Research and development | 21,842 | 19,761 | |||||||||
Restructuring, strategic transaction and integration | 16,105 | 11,013 | |||||||||
Change in fair value of contingent earn-out | 295 | (700) | |||||||||
TOTAL OPERATING EXPENSES | 195,899 | 182,646 | |||||||||
(LOSS) INCOME FROM OPERATIONS | (10,655) | 9,395 | |||||||||
INTEREST EXPENSE, net | (23,772) | (22,515) | |||||||||
OTHER EXPENSE, net | (2,341) | (269) | |||||||||
LOSS BEFORE INCOME TAXES | (36,768) | (13,389) | |||||||||
(PROVISION) BENEFIT FOR INCOME TAXES | (2,703) | 3,577 | |||||||||
NET LOSS | $ | (39,471) | $ | (9,812) | |||||||
NET LOSS PER SHARE | |||||||||||
Basic | $ | (1.63) | $ | (0.41) | |||||||
Diluted | $ | (1.63) | $ | (0.41) | |||||||
WEIGHTED AVERAGE NUMBER OF SHARES | |||||||||||
Basic | 24,222 | 24,014 | |||||||||
Diluted | 24,222 | 24,014 |
Three months ended March 31, |
|||||||||||
2024 | 2023 | ||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||
Net loss | $ | (39,471) | $ | (9,812) | |||||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||||||||||
Depreciation and amortization | 55,526 | 55,744 | |||||||||
Noncash lease expense | 5,341 | 5,656 | |||||||||
Provision for doubtful accounts | 549 | 666 | |||||||||
Provision for warranty, returns and field action | (618) | 3,951 | |||||||||
Stock compensation | 11,598 | 9,158 | |||||||||
(Gain) loss on disposal of property, plant and equipment and other assets | (65) | 367 | |||||||||
Debt issuance costs amortization | 1,708 | 1,701 | |||||||||
Change in fair value of contingent earn-out liability | 295 | (700) | |||||||||
Usage of spare parts | 4,201 | 4,384 | |||||||||
Other | 2,627 | (35) | |||||||||
Changes in operating assets and liabilities, net of amounts acquired: | |||||||||||
Accounts receivable | 13,967 | 82,028 | |||||||||
Inventories | 14,164 | (49,370) | |||||||||
Prepaid expenses and other current assets | (5,735) | 1,907 | |||||||||
Other assets | (5,160) | (6,448) | |||||||||
Accounts payable | 5,313 | (27,525) | |||||||||
Accrued liabilities | (16,503) | (21,099) | |||||||||
Income taxes, including excess tax benefits and deferred income taxes | (1,946) | (9,328) | |||||||||
Net cash provided by operating activities | 45,791 | 41,245 | |||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||
Purchases of property, plant and equipment | (15,915) | (14,205) | |||||||||
Proceeds from sale of assets | 507 | 54 | |||||||||
Intangible asset additions | (2,954) | (2,532) | |||||||||
Proceeds from sale and maturities of investment securities | 500 | 1,500 | |||||||||
Net cash used in investing activities | (17,862) | (15,183) | |||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||
Principal repayments of long-term debt | (12,750) | (7,375) | |||||||||
Proceeds from exercise of stock options | 150 | 171 | |||||||||
Payments on finance leases | (245) | (208) | |||||||||
Payment of contingent earn-out liability | (2,600) | — | |||||||||
Tax withholding payments related to net share settlement of equity awards | (11,400) | (8,425) | |||||||||
Net cash used in financing activities | (26,845) | (15,837) | |||||||||
Effect of exchange rate changes on cash | (3,883) | 1,938 | |||||||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (2,799) | 12,163 | |||||||||
CASH AND CASH EQUIVALENTS, beginning of period | 254,222 | 208,784 | |||||||||
CASH AND CASH EQUIVALENTS, end of period | $ | 251,423 | $ | 220,947 |
Adjusted EBITDA | |||||||||||
Three months ended March 31, |
|||||||||||
2024 | 2023 | ||||||||||
GAAP net loss | $ | (39,471) | $ | (9,812) | |||||||
Non-GAAP adjustments: | |||||||||||
Interest, net | 23,772 | 22,515 | |||||||||
Stock compensation expense | 11,598 | 9,158 | |||||||||
Depreciation and amortization expense | 55,526 | 55,744 | |||||||||
Restructuring, strategic transaction and integration | 16,105 | 11,013 | |||||||||
Change in fair value of contingent earn-out | 295 | (700) | |||||||||
Quality system and product-related charges | 7,498 | 17,090 | |||||||||
Asset write-offs and similar charges | 781 | 550 | |||||||||
Provision (Benefit) for income taxes | 2,703 | (3,577) | |||||||||
Total non-GAAP adjustments | 118,278 | 111,793 | |||||||||
Adjusted EBITDA | $ | 78,807 | $ | 101,981 |
Total revenues | Gross profit | Selling, general and administrative | Research and development | Restructuring, strategic transaction and integration | Change in fair value of contingent earn-out | (Loss) income from operations | (Loss) income before income taxes | Provision for income taxes | Net (loss) income | Diluted (loss) earnings per share | |||||||||||||||||||||||||
Reported (GAAP) | $ | 566,655 | $ | 185,244 | $ | 157,657 | $ | 21,842 | $ | 16,105 | $ | 295 | $ | (10,655) | $ | (36,768) | $ | (2,703) | $ | (39,471) | $ | (1.63) | |||||||||||||
Reported percent of total revenues (or percent of (loss) income before income taxes for benefit (provision) for income taxes) | 33 | % | 28 | % | 4 | % | 3 | % | — | % | (2) | % | (6) | % | (7.4) | % | (7) | % | |||||||||||||||||
Contract manufacturing | (14,073) | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Stock compensation expense | — | 1,582 | (9,563) | (453) | — | — | 11,598 | 11,598 | (2,784) | 8,814 | 0.36 | ||||||||||||||||||||||||
Amortization expense | — | — | (33,130) | — | — | — | 33,130 | 33,130 | (8,046) | 25,084 | 1.03 | ||||||||||||||||||||||||
Restructuring, strategic transaction and integration | — | — | — | — | (16,105) | — | 16,105 | 16,105 | (3,873) | 12,232 | 0.50 | ||||||||||||||||||||||||
Change in fair value of contingent earn-out | — | — | — | — | — | (295) | 295 | 295 | — | 295 | 0.01 | ||||||||||||||||||||||||
Quality system and product-related remediation | — | 7,498 | — | — | — | — | 7,498 | 7,498 | (1,803) | 5,695 | 0.23 | ||||||||||||||||||||||||
Asset write-offs and similar charges | — | 781 | — | — | — | — | 781 | 781 | (187) | 594 | 0.02 | ||||||||||||||||||||||||
Tax expense from valuation allowance* | — | — | — | — | — | — | — | — | 10,143 | 10,143 | 0.42 | ||||||||||||||||||||||||
Earnings per share impact on net loss due to basic versus diluted weighted average shares | — | — | — | — | — | — | — | — | — | — | 0.01 | ||||||||||||||||||||||||
Adjusted (Non-GAAP)** | $ | 552,582 | $ | 195,105 | $ | 114,964 | $ | 21,389 | $ | — | $ | — | $ | 58,752 | $ | 32,639 | $ | (9,253) | $ | 23,386 | $ | 0.96 | |||||||||||||
Adjusted percent of total revenues (or percent of (loss) income before income taxes for benefit (provision) for income taxes) | 35 | % | 21 | % | 4 | % | — | % | — | % | 11 | % | 6 | % | 28.3 | % | 4 | % |
Total revenues | Gross profit | Selling, general and administrative | Research and development | Restructuring, strategic transaction and integration | Change in fair value of contingent earn-out | (Loss) income from operations | (Loss) income before income taxes | Benefit (provision) for income taxes | Net (loss) income | Diluted (loss) earnings per share | |||||||||||||||||||||||||
Reported (GAAP) | $ | 568,649 | $ | 192,041 | $ | 152,572 | $ | 19,761 | $ | 11,013 | $ | (700) | $ | 9,395 | $ | (13,389) | $ | 3,577 | $ | (9,812) | $ | (0.41) | |||||||||||||
Reported percent of total revenues (or percent of (loss) income before income taxes for benefit (provision) for income taxes) | 34 | % | 27 | % | 3 | % | 2 | % | — | % | 2 | % | (2) | % | 26.7 | % | (2) | % | |||||||||||||||||
Contract manufacturing | (12,703) | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Stock compensation expense | — | 1,444 | (7,362) | (352) | — | — | 9,158 | 9,158 | (2,198) | 6,960 | 0.29 | ||||||||||||||||||||||||
Amortization expense | — | — | (32,299) | — | — | — | 32,299 | 32,299 | (7,913) | 24,386 | 1.01 | ||||||||||||||||||||||||
Restructuring, strategic transaction and integration | — | — | — | — | (11,013) | — | 11,013 | 11,013 | (2,654) | 8,359 | 0.34 | ||||||||||||||||||||||||
Change in fair value of contingent earn-out | — | — | — | — | — | 700 | (700) | (700) | — | (700) | (0.03) | ||||||||||||||||||||||||
Quality system and product-related remediation | — | 17,090 | — | — | — | — | 17,090 | 17,090 | (4,204) | 12,886 | 0.53 | ||||||||||||||||||||||||
Asset write-offs and similar charges | — | 550 | — | — | — | — | 550 | 550 | (136) | 414 | 0.01 | ||||||||||||||||||||||||
Adjusted (Non-GAAP) | $ | 555,946 | $ | 211,125 | $ | 112,911 | $ | 19,409 | $ | — | $ | — | $ | 78,805 | $ | 56,021 | $ | (13,528) | $ | 42,493 | $ | 1.74 | |||||||||||||
Adjusted percent of total revenues (or percent of (loss) income before income taxes for benefit (provision) for income taxes) | 38 | % | 20 | % | 3 | % | — | % | — | % | 14 | % | 10 | % | 24.1 | % | 8 | % |
Three months ended March 31 |
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2024 | 2023 | ||||||||||
Net cash provided by operating activities | $ | 45,791 | 41,245 | ||||||||
Purchase of property, plant and equipment | (15,915) | (14,205) | |||||||||
Proceeds from sale of assets | 507 | 54 | |||||||||
Free cash flow | $ | 30,383 | $ | 27,094 |
Low End of Guidance | High End of Guidance | ||||||||||
GAAP net loss(1) |
$ | (127) | $ | (110) | |||||||
Non-GAAP adjustments: | |||||||||||
Interest, net | 105 | 105 | |||||||||
Stock compensation expense(1) |
40 | 40 | |||||||||
Depreciation and amortization expense | 229 | 229 | |||||||||
Restructuring, strategic transaction and integration | 40 | 40 | |||||||||
Quality and regulatory initiatives and remediation | 45 | 45 | |||||||||
(Benefit) Provision for income taxes(1) |
(2) | 21 | |||||||||
Total non-GAAP adjustments | $ | 457 | $ | 480 | |||||||
Adjusted EBITDA | $ | 330 | $ | 370 | |||||||
GAAP diluted loss per share(1) |
$ | (5.16) | $ | (4.46) | |||||||
Non-GAAP adjustments: | |||||||||||
Stock compensation expense(1) |
1.63 | 1.63 | |||||||||
Amortization expense | 5.53 | 5.53 | |||||||||
Restructuring, strategic transaction and integration | 1.63 | 1.63 | |||||||||
Quality and regulatory initiatives and remediation | 1.83 | 1.83 | |||||||||
Tax expense from valuation allowance(1) |
1.49 | 1.49 | |||||||||
Estimated income tax impact from adjustments | (2.55) | (2.55) | |||||||||
Adjusted diluted earnings per share | $ | 4.40 | $ | 5.10 | |||||||
(1) Reflects updates from the full year outlook published on February 27, 2024. |