HOLOGIC INC [HOLX] Filings

10-Q 1 holx-20220625.htm 10-Q holx-20220625

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________________________________________________

FORM 10-Q

__________________________________________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 25, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 1-36214

__________________________________________________________

HOLOGIC, INC.

(Exact name of registrant as specified in its charter)

__________________________________________________________


Delaware						04-2902449
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)
250 Campus Drive,
Marlborough,
Massachusetts						01752
(Address of principal executive offices)						(Zip Code)

(508) 263-2900

(Registrant’s telephone number, including area code)

__________________________________________________________

*Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	HOLX	NASDAQ

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 21, 2022, 249,653,133 shares of the registrant’s Common Stock, $0.01 par value, were outstanding.

Table of Contents

HOLOGIC, INC.

INDEX


		Page

PART I – FINANCIAL INFORMATION

Item 1.	Consolidated Financial Statements (unaudited)

	Consolidated Statements of Income for the Three and Nine Months Ended June 25, 2022 and June 26, 2021	3

	Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended June 25, 2022 and June 26, 2021	4

	Consolidated Balance Sheets as of June 25, 2022 and September 25, 2021	5

	Consolidated Statements of Stockholders' Equity for the Three and Nine Months Ended June 25, 2022 and Year Ended September 25, 2021	6

	Consolidated Statements of Cash Flows for the Nine Months Ended June 25, 2022 and June 26, 2021	8

	Notes to Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	49

Item 4.	Controls and Procedures	50

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	52

Item 1A.	Risk Factors	52

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	53

Item 6.	Exhibits	54

SIGNATURES		55

EXHIBITS

Table of Contents

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

HOLOGIC, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In millions, except number of shares, which are reflected in thousands, and per share data)


	Three Months Ended				Nine Months Ended
	June 25, 2022		June 26, 2021		June 25, 2022		June 26, 2021
Revenues:
Product	$	837.1	$	995.2	$	3,408.7	$	3,829.4
Service and other	165.6		173.1		500.9		486.3
	1,002.7		1,168.3		3,909.6		4,315.7
Costs of revenues:
Product	266.3		303.9		907.0		889.1
Amortization of acquired intangible assets	75.9		68.1		223.1		194.2
Impairment of acquired intangible assets	9.2		—		9.2		—
Service and other	101.5		94.7		287.6		264.7
Gross profit	549.8		701.6		2,482.7		2,967.7
Operating expenses:
Research and development	65.1		69.0		207.4		199.8
Selling and marketing	152.3		142.7		471.0		402.2
General and administrative	91.9		117.3		310.5		297.7
Amortization of acquired intangible assets	11.2		10.4		33.2		30.7


Contingent consideration - fair value adjustments	(35.4)		—		(39.5)		(10.1)


Restructuring and divestiture charges	0.8		3.6		0.8		6.6
	285.9		343.0		983.4		926.9
Income from operations	263.9		358.6		1,499.3		2,040.8
Interest income	2.4		0.4		3.6		1.1
Interest expense	(22.7)		(21.6)		(71.0)		(70.9)
Debt extinguishment loss	—		—		(0.7)		(21.6)
Other income, net	4.8		0.1		13.6		1.1
Income before income taxes	248.4		337.5		1,444.8		1,950.5
Provision for income taxes	20.0		69.4		261.5		409.6
Net income	$	228.4	$	268.1	$	1,183.3	$	1,540.9
Net loss attributable to noncontrolling interest	—		(0.3)		—		(1.8)
Net income attributable to Hologic	$	228.4	$	268.4	$	1,183.3	$	1,542.7
Net income per common share attributable to Hologic:
Basic	$	0.91	$	1.05	$	4.70	$	5.98
Diluted	$	0.90	$	1.04	$	4.65	$	5.93
Weighted average number of shares outstanding:
Basic	250,756		256,230		251,943		257,769
Diluted	253,093		258,581		254,273		260,371

See accompanying notes.

Table of Contents

HOLOGIC, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In millions)


	Three Months Ended				Nine Months Ended
	June 25, 2022		June 26, 2021		June 25, 2022		June 26, 2021
Net income	$	228.4	$	268.1	$	1,183.3	$	1,540.9
Changes in foreign currency translation adjustment	(52.0)		(9.4)		(124.3)		(1.0)




Changes in value of hedged interest rate swaps and interest rate caps, net of tax of $2.5 and $11.6 for the three and nine months ended June 25, 2022 and $1.0 and $2.2 for the three and nine months ended June 26, 2021.
Gain recognized in other comprehensive income, net	8.4		3.0		35.7		8.0
Loss reclassified from accumulated other comprehensive loss to the statements of income	—		—		—		0.5
Other comprehensive (loss) income	(43.6)		(6.4)		(88.6)		7.5
Comprehensive income	$	184.8	$	261.7	$	1,094.7	$	1,548.4
Components of comprehensive income attributable to noncontrolling interest:
Net loss attributable to noncontrolling interest	—		0.3		—		1.8
Comprehensive loss attributable to noncontrolling interest	—		0.3		—		1.8
Comprehensive income attributable to Hologic	$	184.8	$	262.0	$	1,094.7	$	1,550.2

See accompanying notes.

Table of Contents

HOLOGIC, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In millions, except number of shares, which are reflected in thousands, and par value)


	June 25, 2022		September 25, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	2,375.3	$	1,170.3


Accounts receivable, less reserves	702.9		942.7
Inventories	581.2		501.2
Prepaid expenses and other current assets	213.3		528.8
Prepaid income taxes	36.3		25.7


Total current assets	3,909.0		3,168.7
Property, plant and equipment, net	490.1		564.7
Intangible assets, net	1,436.5		1,659.2
Goodwill	3,285.9		3,281.6
Other assets	235.9		245.7
Total assets	$	9,357.4	$	8,919.9
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	7.5	$	313.0
Accounts payable	216.6		215.9
Accrued expenses	573.7		596.2
Deferred revenue	199.6		198.0
Finance lease obligations	3.5		3.7


Total current liabilities	1,000.9		1,326.8
Long-term debt, net of current portion	2,814.6		2,712.2
Finance lease obligations, net of current portion	18.9		22.8
Deferred income tax liabilities	208.3		250.5
Deferred revenue, net of current portion	10.9		20.3
Other long-term liabilities	305.9		368.7
Stockholders’ equity:
Preferred stock, $0.01 par value – 1,623 shares authorized; 0 shares issued	—		—
Common stock, $0.01 par value – 750,000 shares authorized; 298,335 and 297,306 shares issued, respectively	3.0		3.0
Additional paid-in-capital	6,017.4		5,965.8
Retained earnings	1,481.6		298.3
Treasury stock, at cost – 48,851 and 43,653 shares, respectively	(2,356.4)		(1,989.4)
Accumulated other comprehensive loss	(147.7)		(59.1)
Total stockholders’ equity	4,997.9		4,218.6
Total liabilities and stockholders’ equity	$	9,357.4	$	8,919.9

See accompanying notes.

Table of Contents

Hologic, Inc.

Consolidated Statements of Stockholders' Equity

(In millions, except number of shares, which are reflected in thousands)


	Common Stock			Additional Paid-in- Capital		Retained Earnings / (Accumulated Deficit)		Accumulated Other Comprehensive Loss		Treasury Stock					Total Stockholders’ Equity
	Number of Shares	Par Value								Number of Shares	Amount		Noncontrolling Interest




























































































































































Balance at September 26, 2020	295,107	$	2.9	$	5,904.8	$	(1,573.2)	$	(49.7)	37,609	$	(1,579.6)	$	2.1	$	2,707.3
Exercise of stock options	490	—		18.4		—		—		—	—		—		18.4
Vesting of restricted stock units, net	936	0.1		(46.5)		—		—		—	—		—		(46.4)

Stock-based compensation	—	—		18.6		—		—		—	—		—		18.6
Net income (loss)	—	—		—		654.4		—		—	—		(1.0)		653.4
Other comprehensive income activity	—	—		—		—		19.0		—	—		—		19.0
Repurchase of common stock	—	—		—		—		—		1,469	(101.3)		—		(101.3)
Balance at December 26, 2020	296,533	$	3.0	$	5,895.3	$	(918.8)	$	(30.7)	39,078	$	(1,680.9)	$	1.1	$	3,269.0
Exercise of stock options	146	—		5.8		—		—		—	—		—		5.8
Vesting of restricted stock units, net	17	—		(0.3)		—		—		—	—		—		(0.3)
Common stock issued under the employee stock purchase plan	191	—		9.2		—		—		—	—		—		9.2
Stock-based compensation	—	—		17.1		—		—		—	—		—		17.1
Net income (loss)	—	—		—		619.9		—		—	—		(0.5)		619.4
Other comprehensive income activity	—	—		—		—		(5.1)		—	—		—		(5.1)
Repurchase of common stock	—	—		—		—		—		1,604	(120.1)		—		(120.1)
Balance at March 27, 2021	296,887	$	3.0	$	5,927.1	$	(298.9)	$	(35.8)	40,682	$	(1,801.0)	$	0.6	$	3,795.0
Exercise of stock options	53	—		2.1		—		—		—	—		—		2.1
Vesting of restricted stock units, net	5	—		(0.2)		—		—		—	—		—		(0.2)

Stock-based compensation	—	—		15.4		—		—		—	—		—		15.4
Net income (loss)	—	—		—		268.4		—		—	—		(0.3)		268.1
Other comprehensive income activity	—	—		—		—		(6.4)		—	—		—		(6.4)
Repurchase of common stock	—	—		—		—		—		2,971	(188.4)		—		(188.4)
Purchase of non-controlling interest	—	—		(8.2)		—		—		—	—		(0.3)		(8.5)
Balance at June 26, 2021	296,945	$	3.0	$	5,936.2	$	(30.5)	$	(42.2)	43,653	$	(1,989.4)	$	—	$	3,877.1
Exercise of stock options	168	—		6.6		—		—		—	—		—		6.6
Vesting of restricted stock units, net	22	—		(0.6)		—		—		—	—		—		(0.6)
Common stock issued under the employee stock purchase plan	171	—		9.7		—		—		—	—		—		9.7

Table of Contents


Stock-based compensation	—	—		13.9		—		—		—	—		—		13.9
Net income	—	—		—		328.8		—		—	—		—		328.8
Other comprehensive income activity	—	—		—		—		(16.9)		—	—		—		(16.9)


Balance at September 25, 2021	297,306	$	3.0	$	5,965.8	$	298.3	$	(59.1)	43,653	$	(1,989.4)	$	—	$	4,218.6
Exercise of stock options	45	—		1.9		—		—		—	—		—		1.9
Vesting of restricted stock units, net	534	—		(22.4)		—		—		—	—		—		(22.4)

Stock-based compensation	—	—		18.7		—		—		—	—		—		18.7
Net income	—	—		—		499.2		—		—	—		—		499.2
Other comprehensive income activity	—	—		—		—		(29.9)		—	—		—		(29.9)
Repurchase of common stock	—	—		—		—		—		2,335	(167.0)		—		(167.0)
Balance at December 25, 2021	297,885	$	3.0	$	5,964.0	$	797.5	$	(89.0)	45,988	$	(2,156.4)	$	—	$	4,519.1
Exercise of stock options	140	—		5.8		—		—		—	—		—		5.8
Vesting of restricted stock units, net	14	—		(0.1)		—		—		—	—		—		(0.1)
Common stock issued under the employee stock purchase plan	164	—		9.5		—		—		—	—		—		9.5
Stock-based compensation	—	—		17.8		—		—		—	—		—		17.8
Net income	—	—		—		455.7		—		—	—		—		455.7
Other comprehensive income activity	—	—		—		—		(15.1)		—	—		—		(15.1)
Repurchase of common stock	—	—		—		—		—		2,863	(200.0)		—		(200.0)
Balance at March 26, 2022	298,203	$	3.0	$	5,997.0	$	1,253.2	$	(104.1)	48,851	$	(2,356.4)	$	—	$	4,792.7
Exercise of stock options	128	—		5.2		—		—		—	—		—		5.2
Vesting of restricted stock units, net	4	—		(0.1)		—		—		—	—		—		(0.1)

HOLOGIC INC [HOLX] Filings
10-Q	[2022-07-27]
10-Q	[2022-04-27]
10-Q	[2022-02-02]
10-K	[2021-11-16]
10-Q	[2021-07-28]
10-Q	[2021-04-28]
10-Q	[2021-01-27]
10-K	[2020-11-17]
10-Q	[2020-07-29]
10-Q	[2020-04-29]
10-Q	[2020-01-29]
10-K	[2019-11-27]
10-Q	[2019-07-31]
10-Q	[2019-05-01]
10-Q	[2019-01-30]
10-K	[2018-11-20]
10-Q	[2018-07-31]
10-Q	[2018-05-02]
10-Q	[2018-02-08]
10-K	[2017-11-21]
10-Q	[2017-08-02]
10-Q	[2017-05-10]
10-Q	[2017-02-03]
10-K	[2016-11-17]
10-Q	[2016-07-27]
10-Q	[2016-04-27]
10-Q	[2016-01-27]
10-K	[2015-11-19]
10-Q	[2015-07-29]
10-Q	[2015-04-30]
10-Q	[2015-01-29]
10-K	[2014-11-20]
10-Q	[2014-07-31]
10-Q	[2014-05-02]
10-Q	[2014-02-06]
10-K	[2013-11-26]
10-Q	[2013-08-07]
10-Q	[2013-05-09]
10-Q	[2013-02-07]
10-K	[2012-11-28]
10-Q	[2012-08-02]
10-Q	[2012-05-03]
10-Q	[2012-02-02]