d Peripheral Intervention engu%911Y2022
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
OR
For the transition period from to .
Commission File Number
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(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
(Address of principal executive offices, including zip code)
Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol | Name of exchange on which registered |
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 filing requirements for the past 90 days.
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 during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
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.
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
Indicate the number of shares outstanding of each of the Registrant’s classes of common stock, as of the latest practicable date.
Common Stock, no par |
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TABLE OF CONTENTS
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Management’s Discussion and Analysis of Financial Condition and Results of Operations | 30 | ||||
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
MERIT MEDICAL SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
| September 30, |
| December 31, | |||
ASSETS |
| 2022 |
| 2021 | ||
(unaudited) | ||||||
Current assets: |
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Cash and cash equivalents | $ | | $ | | ||
Trade receivables — net of allowance for credit losses — 2022 — $ |
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Other receivables |
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Inventories |
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Prepaid expenses and other current assets |
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Prepaid income taxes |
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Income tax refund receivables |
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Total current assets |
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Property and equipment: |
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Land and land improvements |
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Buildings |
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Manufacturing equipment |
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Furniture and fixtures |
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Leasehold improvements |
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Construction-in-progress |
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Total property and equipment |
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Less accumulated depreciation |
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Property and equipment — net |
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Other assets: |
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Intangible assets: |
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Developed technology — net of accumulated amortization — 2022 — $ |
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Other — net of accumulated amortization — 2022 — $ |
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Goodwill |
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Deferred income tax assets |
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Right-of-use operating lease assets | | | ||||
Other assets |
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Total other assets |
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Total assets | $ | | $ | |
See condensed notes to consolidated financial statements. | (continued) |
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MERIT MEDICAL SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
| September 30, |
| December 31, | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
| 2022 |
| 2021 | ||
(unaudited) | ||||||
Current liabilities: |
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Trade payables | $ | | $ | | ||
Accrued expenses |
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Current portion of long-term debt |
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Short-term operating lease liabilities | | | ||||
Income taxes payable |
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Total current liabilities |
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Long-term debt |
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Deferred income tax liabilities |
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Long-term income taxes payable |
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Liabilities related to unrecognized tax benefits |
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Deferred compensation payable |
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Deferred credits |
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Long-term operating lease liabilities | |
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Other long-term obligations |
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Total liabilities |
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Commitments and contingencies |
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Stockholders' equity: |
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Preferred stock — |
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Common stock, |
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Retained earnings |
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Accumulated other comprehensive loss |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity | $ | | $ | |
See condensed notes to consolidated financial statements. | (concluded) |
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MERIT MEDICAL SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts - unaudited)
| Three Months Ended |
| Nine Months Ended | |||||||||
September 30, | September 30, | |||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
Net sales | $ | | $ | | $ | | $ | | ||||
Cost of sales |
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Gross profit |
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Operating expenses: |
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Selling, general and administrative |
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Research and development |
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Impairment charges |
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Contingent consideration expense |
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Acquired in-process research and development |
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Total operating expenses |
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Income from operations |
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Other income (expense): |
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Interest income |
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Interest expense |
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Other income (expense) — net |
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Total other expense — net |
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Income before income taxes |
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Income tax expense |
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Net income | $ | | $ | | $ | | $ | | ||||
Earnings per common share |
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Basic | $ | | $ | | $ | | $ | | ||||
Diluted | $ | | $ | | $ | | $ | | ||||
Weighted average shares outstanding |
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Basic |
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Diluted |
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See condensed notes to consolidated financial statements.
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MERIT MEDICAL SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands - unaudited)
| Three Months Ended |
| Nine Months Ended | |||||||||
September 30, | September 30, | |||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
Net income | $ | | $ | | $ | | $ | | ||||
Other comprehensive income (loss): |
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Cash flow hedges |
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Income tax benefit (expense) |
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Foreign currency translation adjustment |
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Income tax benefit (expense) |
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Total other comprehensive income (loss) |
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Total comprehensive income | $ | | $ | | $ | | $ | |
See condensed notes to consolidated financial statements.
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MERIT MEDICAL SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands - unaudited)
Common Stock | Retained | Accumulated Other | ||||||||||||
| Shares |
| Amount |
| Earnings |
| Comprehensive Income (Loss) |
| Total | |||||
Balance — January 1, 2022 |
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Net income |
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Other comprehensive income |
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Stock-based compensation expense |
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Options exercised |
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Issuance of common stock under Employee Stock Purchase Plan |
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Shares issued from time-vested restricted stock units | | — | — | |||||||||||
Shares surrendered in exchange for payment of payroll tax liabilities |
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Balance — March 31, 2022 |
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Net income |
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Other comprehensive loss |
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Stock-based compensation expense |
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Options exercised |
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Issuance of common stock under Employee Stock Purchase Plan |
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Shares issued from time-vested restricted stock units | | — | — | |||||||||||
Balance — June 30, 2022 |
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Net income |
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Other comprehensive loss |
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Stock-based compensation expense |
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Options exercised |
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Issuance of common stock under Employee Stock Purchase Plan |
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Shares surrendered in exchange for payment of payroll tax liabilities | ( | ( | ( | |||||||||||
Shares surrendered in exchange for exercise of stock options | ( | ( | ( | |||||||||||
Balance — September 30, 2022 |
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See condensed notes to consolidated financial statements. | (continued) |
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MERIT MEDICAL SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands - unaudited)
Common Stock | Retained | Accumulated Other | ||||||||||||
| Shares |
| Amount |
| Earnings |
| Comprehensive Income (Loss) |
| Total | |||||
Balance — January 1, 2021 |
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Net income |
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Other comprehensive loss |
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Stock-based compensation expense |
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Options exercised |
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Issuance of common stock under Employee Stock Purchase Plan |
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Shares issued from time-vested restricted stock units | | — | — | |||||||||||
Shares surrendered in exchange for payment of payroll tax liabilities |
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Shares surrendered in exchange for exercise of stock options |
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Balance — March 31, 2021 |
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Net income |
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Other comprehensive income |
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Stock-based compensation expense |
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Options exercised |
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Issuance of common stock under Employee Stock Purchase Plan |
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Shares issued from time-vested restricted stock units | | — | — | |||||||||||
Balance — June 30, 2021 | | | | ( | | |||||||||
Net income |
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Other comprehensive loss |
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Stock-based compensation expense |
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Options exercised |
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Issuance of common stock under Employee Stock Purchase Plan |
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Shares surrendered in exchange for payment of payroll tax liabilities | ( | ( | ( | |||||||||||
Shares surrendered in exchange for exercise of stock options | ( | ( | ( | |||||||||||
Balance — September 30, 2021 | | $ | | $ | | $ | ( | $ | |
See condensed notes to consolidated financial statements. | (concluded) |
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MERIT MEDICAL SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands - unaudited)
Nine Months Ended | ||||||
September 30, | ||||||
| 2022 |
| 2021 | |||
CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net income | $ | | $ | | ||
Adjustments to reconcile net income to net cash provided by operating activities: |
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Depreciation and amortization |
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Loss on disposition of business |
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Loss on sale or abandonment of property and equipment |
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Write-off of certain intangible assets and other long-term assets |
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Acquired in-process research and development |
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Amortization of right-of-use operating lease assets | | | ||||
Adjustments and payments related to contingent consideration liability | | | ||||
Amortization of deferred credits |
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Amortization of long-term debt issuance costs |
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Stock-based compensation expense |
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Changes in operating assets and liabilities, net of acquisitions and divestitures: |
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Trade receivables |
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Other receivables |
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Inventories |
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Prepaid expenses and other current assets |
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Income tax refund receivables |
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Other assets |
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Trade payables |
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Accrued expenses |
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Income taxes payable |
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Deferred compensation payable |
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Operating lease liabilities | ( | ( | ||||
Other long-term obligations |
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Total adjustments |
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Net cash, cash equivalents, and restricted cash provided by operating activities |
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CASH FLOWS FROM INVESTING ACTIVITIES: |
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Capital expenditures for: |
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Property and equipment |
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Intangible assets |
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Proceeds from the sale of property and equipment |
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Payments from disposition of business | ( | — | ||||
Cash paid in acquisitions, net of cash acquired |
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Net cash, cash equivalents, and restricted cash used in investing activities | $ | ( | $ | ( |
See condensed notes to consolidated financial statements. | (continued) |
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MERIT MEDICAL SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands - unaudited)
| Nine Months Ended | |||||
September 30, | ||||||
2022 | 2021 | |||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
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Proceeds from issuance of common stock | $ | | $ | | ||
Proceeds from issuance of long-term debt |
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Payments on long-term debt | ( | ( | ||||
Contingent payments related to acquisitions |
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Payment of taxes related to an exchange of common stock |
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Net cash, cash equivalents, and restricted cash used in financing activities |
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Effect of exchange rates on cash, cash equivalents, and restricted cash |
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Net increase (decrease) in cash, cash equivalents and restricted cash |
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CASH, CASH EQUIVALENTS AND RESTRICTED CASH: |
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Beginning of period |
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End of period | $ | | $ | | ||
RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH TO THE CONSOLIDATED BALANCE SHEETS: | ||||||
Cash and cash equivalents | | | ||||
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