Company Quick10K Filing
Quick10K
Owens & Minor
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$3.96 63 $249
10-Q 2019-03-31 Quarter: 2019-03-31
10-K 2018-12-31 Annual: 2018-12-31
10-Q 2018-09-30 Quarter: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-K 2017-12-31 Annual: 2017-12-31
10-Q 2017-09-30 Quarter: 2017-09-30
10-Q 2017-06-30 Quarter: 2017-06-30
10-Q 2017-03-31 Quarter: 2017-03-31
10-K 2016-12-31 Annual: 2016-12-31
10-Q 2016-09-30 Quarter: 2016-09-30
10-Q 2016-06-30 Quarter: 2016-06-30
10-Q 2016-03-31 Quarter: 2016-03-31
10-K 2015-12-31 Annual: 2015-12-31
10-Q 2015-09-30 Quarter: 2015-09-30
10-Q 2015-06-30 Quarter: 2015-06-30
10-Q 2015-03-31 Quarter: 2015-03-31
10-K 2014-12-31 Annual: 2014-12-31
10-Q 2014-09-30 Quarter: 2014-09-30
10-Q 2014-06-30 Quarter: 2014-06-30
10-Q 2014-03-31 Quarter: 2014-03-31
10-K 2013-12-31 Annual: 2013-12-31
8-K 2019-05-10 Officers, Amend Bylaw, Shareholder Vote, Exhibits
8-K 2019-05-07 Earnings, Exhibits
8-K 2019-04-08 Officers, Regulation FD, Exhibits
8-K 2019-03-12 Regulation FD, Exhibits
8-K 2019-02-25 Regulation FD, Exhibits
8-K 2019-02-19 Earnings, Regulation FD, Exhibits
8-K 2019-02-19 Officers, Amend Bylaw, Regulation FD, Exhibits
8-K 2019-02-12 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2019-02-07 Amend Bylaw, Exhibits
8-K 2019-01-10 Regulation FD, Exhibits
8-K 2018-12-06 Officers, Regulation FD, Exhibits
8-K 2018-11-07 Officers, Amend Bylaw, Regulation FD, Exhibits
8-K 2018-10-31 Earnings, Regulation FD, Exhibits
8-K 2018-08-07 Earnings, Regulation FD, Exhibits
8-K 2018-06-06 Officers
8-K 2018-05-09 Officers, Amend Bylaw, Shareholder Vote, Other Events, Exhibits
8-K 2018-05-04 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2018-04-30 Enter Agreement, M&A, Regulation FD, Exhibits
8-K 2018-04-09 Regulation FD, Exhibits
8-K 2018-04-02 Other Events, Exhibits
8-K 2018-02-28 Officers, Amend Bylaw, Regulation FD, Exhibits
8-K 2018-02-14 Earnings, Exhibits
8-K 2018-01-31 Earnings, Exhibits
BPR Brookfield Property REIT 14,690
SRPT Sarepta Therapeutics 8,820
ARMK Aramark 7,730
LTM Life Time Fitness 5,850
TRC Tejon Ranch 460
SIC Select Interior Concepts 326
OPRX Optimizerx 160
SBPH Spring Bank Pharmaceuticals 110
GGRO Golden Growers Cooperative 0
PAY Verifone 0
OMI 2019-03-31
Part I. Financial Information
Item 1. Financial Statements
Note 1-Summary of Significant Accounting Policies
Note 2-Fair Value
Note 3-Acquisitions
Note 4-Financing Receivables and Payables
Note 5-Goodwill and Intangible Assets
Note 6-Leases
Note 7-Derivatives
Note 8-Exit and Realignment Costs
Note 9-Retirement Plans
Note 10-Debt
Note 11-Income Taxes
Note 12-Net Income per Common Share
Note 13-Shareholders' Equity
Note 14-Accumulated Other Comprehensive Income (Loss)
Note 15-Segment Information
Note 16-Condensed Consolidating Financial Information
Note 17-Recent Accounting Pronouncements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities
Item 6. Exhibits
EX-31.1 ex311q119.htm
EX-31.2 ex312q119.htm
EX-32.1 ex321q119.htm
EX-32.2 ex322q119.htm

Owens & Minor Earnings 2019-03-31

OMI 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

10-Q 1 omi3312019-10q.htm 10-Q Document

 
 
 
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________________________________ 
FORM 10-Q
________________________________________________ 
 
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2019
OR
¨
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 1-9810
_______________________________________________________
Owens & Minor, Inc.
(Exact name of Registrant as specified in its charter)
_______________________________________________________

Virginia
54-1701843
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
 
 
9120 Lockwood Boulevard,
Mechanicsville, Virginia
23116
(Address of principal executive offices)
(Zip Code)
 
 
Post Office Box 27626,
Richmond, Virginia
23261-7626
(Mailing address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code (804) 723-7000
_________________________________________________________
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  x    No  ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).    Yes  x    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 “larger accelerated filer”, “accelerated filer”, “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
x
Accelerated filer
¨
Non-accelerated filer
o  (Do not check if a smaller reporting company)
Smaller reporting company
¨
Emerging growth company
o
 
 
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.
o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x
The number of shares of Owens & Minor, Inc.’s common stock outstanding as of May 1, 2019, was 62,935,985 shares.
 
 
 
 
 



Owens & Minor, Inc. and Subsidiaries
Index
 
Page
 
 
 
Item 1.
 
 
 
 
 
 
Item 2.
Item 3.
Item 4.
 
Item 1.
Item 1A.
Item 2.
Item 6.

2



Part I. Financial Information
Item 1. Financial Statements
Owens & Minor, Inc. and Subsidiaries
Consolidated Statements of Income (Loss)
(unaudited)
 
 
 
Three Months Ended 
 March 31,
(in thousands, except per share data)
 
2019
 
2018
Net revenue
 
$
2,461,388

 
$
2,372,579

Cost of goods sold
 
2,102,964

 
2,047,892

Gross margin

358,424

 
324,687

Distribution, selling and administrative expenses
 
338,703

 
284,361

Acquisition-related and exit and realignment charges
 
4,990

 
14,760

Other operating expense, net
 
39

 
1,349

Operating income
 
14,692

 
24,217

Interest expense, net
 
29,101

 
10,253

Income (loss) before income taxes
 
(14,409
)
 
13,964

Income tax (benefit) provision
 
(313
)
 
5,813

Net income (loss)
 
$
(14,096
)
 
$
8,151

 
 
 
 
 
Net income (loss) per common share: basic and diluted
 
$
(0.23
)
 
$
0.13



See accompanying notes to consolidated financial statements.
3


Owens & Minor, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income (Loss)
(unaudited)
 
 
 
Three Months Ended 
 March 31,
(in thousands)
 
2019

2018
Net income (loss)
 
$
(14,096
)
 
$
8,151

Other comprehensive income (loss), net of tax:
 
 
 
 
Currency translation adjustments (net of income tax of $0 in 2019 and 2018)
 
(4,207
)
 
8,921

Change in unrecognized net periodic pension costs (net of income tax of $69 in 2019 and $142 in 2018)
 
197

 
380

Net unrealized gain (loss) on derivative instruments and other (net of income tax of $658 in 2019 and $0 in 2018)
 
(2,413
)
 
6

Total other comprehensive income (loss), net of tax
 
(6,423
)
 
9,307

Comprehensive income (loss)
 
$
(20,519
)
 
$
17,458



See accompanying notes to consolidated financial statements.
4


Owens & Minor, Inc. and Subsidiaries
Consolidated Balance Sheets
(unaudited)
 
 
March 31,
 
December 31,
(in thousands, except per share data)
2019
 
2018
Assets
 
 
 
Current assets
 
 
 
Cash and cash equivalents
$
75,239

 
$
103,367

Accounts receivable, net of allowances of $21,572 and $19,618
843,384

 
823,418

Merchandise inventories
1,210,558

 
1,290,103

Other current assets
336,065

 
321,690

Total current assets
2,465,246

 
2,538,578

Property and equipment, net of accumulated depreciation of $283,804 and $270,105
386,135

 
386,723

Operating lease assets
197,200

 

Goodwill
413,235

 
414,122

Intangible assets, net
311,254

 
321,764

Other assets, net
109,294

 
112,601

Total assets
$
3,882,364

 
$
3,773,788

Liabilities and equity
 
 

Current liabilities
 
 

Accounts payable
$
990,688

 
$
1,109,589

Accrued payroll and related liabilities
40,999

 
48,203

Other current liabilities
377,989

 
314,219

Total current liabilities
1,409,676

 
1,472,011

Long-term debt, excluding current portion
1,685,135

 
1,650,582

Operating lease liabilities, excluding current portion
155,703

 

Deferred income taxes
42,144

 
50,852

Other liabilities
87,867

 
81,924

Total liabilities
3,380,525

 
3,255,369

Commitments and contingencies

 

Equity
 
 
 
Common stock, par value $2 per share; authorized - 200,000 shares; issued and outstanding - 62,936 shares and 62,294 shares
125,872

 
124,588

Paid-in capital
241,547

 
238,773

Retained earnings
186,455

 
200,670

Accumulated other comprehensive loss
(52,035
)
 
(45,612
)
Total equity
501,839

 
518,419

Total liabilities and equity
$
3,882,364

 
$
3,773,788



See accompanying notes to consolidated financial statements.
5


Owens & Minor, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(unaudited)
 
 
Three Months Ended March 31,
(in thousands)
2019
 
2018
Operating activities:
 
 
 
Net income (loss)
$
(14,096
)
 
$
8,151

Adjustments to reconcile net income to cash (used for) provided by operating activities:
 
 

Depreciation and amortization
28,720

 
17,911

Share-based compensation expense
4,505

 
3,035

Provision for losses on accounts receivable
3,619

 
1,073

Deferred income tax benefit
(8,613
)
 
(1,482
)
Changes in operating assets and liabilities:
 
 

Accounts receivable
(22,573
)
 
(18,519
)
Merchandise inventories
80,194

 
(30,556
)
Accounts payable
(120,480
)
 
9,478

Net change in other assets and liabilities
(15,858
)
 
28,904

Other, net
3,678

 
278

Cash (used for) provided by operating activities
(60,904
)
 
18,273

Investing activities:
 
 
 
Additions to property and equipment
(11,674
)
 
(7,074
)
Additions to computer software and intangible assets
(2,605
)
 
(7,086
)
Proceeds from sale of property and equipment
271

 

Cash used for investing activities
(14,008
)
 
(14,160
)
Financing activities:
 
 
 
Borrowings (repayments) under revolving credit facility
72,100

 
(300
)
Repayments of debt
(12,394
)
 
(3,125
)
Financing costs paid
(4,313
)
 

Cash dividends paid
(4,764
)
 
(16,074
)
Other, net
(1,124
)
 
(2,304
)
Cash provided by (used for) financing activities
49,505

 
(21,803
)
Effect of exchange rate changes on cash and cash equivalents
(2,721
)
 
800

Net decrease in cash and cash equivalents
(28,128
)
 
(16,890
)
Cash and cash equivalents at beginning of period
103,367

 
104,522

Cash and cash equivalents at end of period
$
75,239

 
$
87,632

Supplemental disclosure of cash flow information:
 
 
 
Income taxes paid, net of refunds
$
(12,388
)
 
$
1,197

Interest paid
$
24,504

 
$
9,661




See accompanying notes to consolidated financial statements.
6


Owens & Minor, Inc. and Subsidiaries
Consolidated Statements of Changes in Equity
(unaudited)
 
(in thousands, except per share data)
Common
Shares
Outstanding
 
Common 
Stock
($2 par value )
 
Paid-In
Capital
 
Retained
Earnings
 
Accumulated
Other
Comprehensive Income
(Loss)
 
Total
Equity
Balance, December 31, 2017
61,476

 
$
122,952

 
$
226,937

 
$
690,674

 
$
(25,084
)
 
$
1,015,479

Net income
 
 
 
 
 
 
8,151

 
 
 
8,151

Other comprehensive income
 
 
 
 
 
 
 
 
9,307

 
9,307

Dividends declared ($0.26 per share)
 
 
 
 
 
 
(16,027
)
 
 
 
(16,027
)
Share-based compensation expense, exercises and other
336

 
672

 
1,336

 

 
 
 
2,008

Balance, March 31, 2018
61,812

 
$
123,624

 
$
228,273

 
$
682,798

 
$
(15,777
)
 
$
1,018,918

 
 
 
 
 
 
 
 
 
 
 
 
Balance, December 31, 2018
62,294

 
$
124,588

 
$
238,773

 
$
200,670

 
$
(45,612
)
 
$
518,419

Net loss
 
 
 
 
 
 
(14,096
)
 
 
 
(14,096
)
Other comprehensive loss
 
 
 
 
 
 
 
 
(6,423
)
 
(6,423
)
Dividends declared ($0.0025 per share)
 
 
 
 
 
 
(119
)
 
 
 
(119
)
Share-based compensation expense, exercises and other
642

 
1,284

 
2,774

 
 
 
 
 
4,058

Balance, March 31, 2019
62,936

 
$
125,872

 
$
241,547

 
$
186,455

 
$
(52,035
)
 
$
501,839



See accompanying notes to consolidated financial statements.
7


Owens & Minor, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(unaudited)
(in thousands, unless otherwise indicated)
Note 1—Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited consolidated financial statements include the accounts of Owens & Minor, Inc. and the subsidiaries it controls (we, us, or our) and contain all adjustments (which are comprised only of normal recurring accruals and use of estimates) necessary to conform with U.S. generally accepted accounting principles (GAAP). All significant intercompany accounts and transactions have been eliminated. The results of operations for interim periods are not necessarily indicative of the results expected for the full year.
Reclassifications
Certain prior year amounts have been reclassified to conform to current year presentation.
Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires us to make assumptions and estimates that affect reported amounts and related disclosures. Actual results may differ from these estimates.
See Note 15 for disaggregation of revenue by segment and geography as we believe that best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.
Note 2—Fair Value
The carrying amounts of cash and cash equivalents, accounts receivable, financing receivables, accounts payable and financing payables included in the consolidated balance sheets approximate fair value due to the short-term nature of these instruments. The fair value of long-term debt is estimated based on quoted market prices or dealer quotes for the identical liability when traded as an asset in an active market (Level 1) or, if quoted market prices or dealer quotes are not available, on the borrowing rates currently available for loans with similar terms, credit ratings, and average remaining maturities (Level 2). The fair value of interest rate swaps and foreign currency contracts is determined based on the present value of expected future cash flows considering the risks involved, including non-performance risk, and using discount rates appropriate for the respective maturities. Observable Level 2 inputs are used to determine the present value of expected future cash flows.
Note 3—Acquisitions
On April 30, 2018 (the Closing Date), we completed the acquisition of substantially all of Avanos Medical, Inc.'s (Avanos, previously Halyard Health, Inc.) Surgical and Infection Prevention (S&IP) business, the name “Halyard Health” (and all variations of that name and related intellectual property rights) and its information technology (IT) systems in exchange for $758 million, net of cash acquired. The Halyard business is a leading global provider of medical supplies and solutions for the prevention of healthcare associated infections across acute care and non-acute care markets. This business is reported as part of the Global Products segment.
The following table presents the preliminary estimated fair value of the assets acquired and liabilities assumed recognized as of the acquisition date. The fair value of intangibles from this acquisition was primarily determined by applying the income approach, using several significant unobservable inputs for projected cash flows and a discount rate. These inputs are considered Level 3 inputs. The allocation of purchase price to assets and liabilities acquired is not yet complete, as valuations of certain tangible and intangible assets are still in process.

8



 
Preliminary Fair Value
Originally Estimated as of
Acquisition Date
(1)
 
Differences Between Prior and Current Period Preliminary Fair Value
 
Fair Value Estimated as of Acquisition Date
Assets acquired:
 
 
 
 
 
Current assets
$
330,870

 
$

 
$
330,870

Goodwill
130,364

 

 
130,364

Intangible assets
191,230

 

 
191,230

Other noncurrent assets
218,240

 

 
218,240

Total assets
870,704

 

 
870,704

Liabilities assumed:
 
 
 
 
 
Current liabilities
92,438

 

 
92,438

Noncurrent liabilities
20,217

 

 
20,217

Total liabilities
112,655

 

 
112,655

Fair value of net assets acquired, net of cash
$
758,049

 
$

 
$
758,049

(1) As previously reported in our 2018 Form 10-K.
We are amortizing the preliminary fair value of acquired intangible assets, primarily customer relationships, a trade name and other intellectual property, over their estimated weighted average useful lives of eight to 12 years.
Goodwill of $130 million, which we assigned to our Global Products segment, consists largely of expected opportunities to expand into new markets and further develop a presence in the medical products segment. None of the goodwill recognized is expected to be deductible for income tax purposes.
The unaudited pro forma results of net revenue for the period ended March 31, 2018 as if Halyard was acquired on January 1, 2018 were $2,582,579. The pro forma results of net income (loss) and net income (loss) per common share have not been represented because the effects were not material to our historic consolidated financial statements. Accordingly, the pro forma results noted above are not necessarily indicative of the results that would have been if the acquisition had occurred on the dates indicated, nor are the pro forma results indicative of results which may occur in the future.
Note 4—Financing Receivables and Payables
At March 31, 2019 and December 31, 2018, we had financing receivables of $209.7 million and $183.3 million, respectively, and related payables of $100.5 million and $100.3 million, respectively, outstanding under our order-to-cash program, which were included in other current assets and other current liabilities, respectively, in the consolidated balance sheets.
Note 5—Goodwill and Intangible Assets
The following table summarizes the goodwill balances by segment and the changes in the carrying amount of goodwill through March 31, 2019:
 
Global Solutions
 
Global Products
 
Consolidated
Carrying amount of goodwill, December 31, 2018
$
283,905

 
$
130,217

 
$
414,122

Currency translation adjustments

 
(887
)
 
(887
)
Carrying amount of goodwill, March 31, 2019
$
283,905

 
$
129,330

 
$
413,235


9



Intangible assets at March 31, 2019 and December 31, 2018, were as follows:
 
March 31, 2019
 
December 31, 2018
 
Customer
Relationships
 
Tradenames
 
Other
Intangibles
 
Customer
Relationships
 
Tradenames
 
Other
Intangibles
 
 
 
 
 
 
 
 
 
 
 
 
Gross intangible assets
$
267,732

 
$
97,000

 
$
42,724

 
$
267,510

 
$
97,000

 
$
42,930

Accumulated amortization
(79,999
)
 
(10,779
)
 
(5,424
)
 
(72,947
)
 
(8,544
)
 
(4,185
)
Net intangible assets
$
187,733

 
$
86,221

 
$
37,300

 
$
194,563

 
$
88,456

 
$
38,745

Weighted average useful life
10 years

 
11 years

 
8 years

 
10 years

 
11 years

 
8 years

At March 31, 2019, $102.0 million in net intangible assets were held in the Global Solutions segment and $209.3 million were held in the Global Products segment. Amortization expense for intangible assets was $10.4 million and $6.4 million for the three months ended March 31, 2019 and 2018, respectively.
Based on the current carrying value of intangible assets subject to amortization, estimated amortization expense is $31.2 million for the remainder of 2019, $40.7 million for 2020, $39.0 million for 2021, $38.1 million for 2022, $36.9 million for 2023 and $31.6 million for 2024.
Note 6—Leases
We adopted ASU No. 2016-02, Leases (Topic 842), as of January 1, 2019. We elected to use the adoption date as our date of initial application and thus have not restated comparative prior periods. See Note 17 for additional information, including as it relates to the practical expedients.
We enter into non-cancelable agreements to lease most of our office and warehouse facilities with remaining terms generally ranging from one to 20 years. Certain leases include renewal options, generally for five-year increments. The exercise of lease renewal options is at our sole discretion. Our lease terms may include those options to extend or terminate the lease when it is reasonably certain that we will exercise that option. We also lease some of our transportation and material handling equipment for terms generally ranging from three to 10 years. Leases with a term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.
Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. The operating lease asset also includes any lease payments made and excludes lease incentives.
The components of lease expense were as follows:
 
Classification
 
Three months ended March 31, 2019
Operating lease cost (1)
Distribution, selling and administrative expenses
 
$
17,437

Finance lease cost:
 
 
 
Amortization of lease assets
Distribution, selling and administrative expenses
 
756

Interest on lease liabilities
Interest expense, net
 
334

Total finance lease cost
 
 
1,090

Total lease cost
 
 
$
18,527

(1) Includes short-term lease and variable lease costs, which are immaterial.




10




Supplemental balance sheet information is as follows:
 
Classification
 
As of March 31, 2019
Assets:
 
 
 
Operating lease assets
Operating lease assets
 
$
197,200

Finance lease assets
Property and equipment, net
 
10,921

Total lease assets
 
 
$
208,121

Liabilities:
 
 
 
Current
 
 

Operating
Other current liabilities
 
$
44,876

Finance
Other current liabilities
 
2,365

Noncurrent
 
 
 
Operating
Operating lease liabilities, excluding current portion
 
155,703

Finance
Long-term debt, excluding current portion
 
12,820

Total lease liabilities
 
 
$
215,764

Other information related to leases was as follows:
 
Three months ended March 31, 2019
Supplemental cash flow information
 
Cash paid for amounts included in the measurement of lease liabilities:
 
Operating cash flows from operating and finance leases
$
16,695

Financing cash flows from finance leases
$
674

 
 
Right-of-use assets obtained in exchange for new operating and finance lease liabilities
$
5,635

 
 
Weighted average remaining lease term (years)
 
Operating leases
6.3

Finance leases
8.3

 
 
Weighted average discount rate
 
Operating leases
12.3
%
Finance leases
8.9
%











11



Maturities of lease liabilities as of March 31, 2019 were as follows:
 
Operating Leases
 
Finance Leases
 
Total
2019 (remainder)
$
56,059

 
$
3,031

 
$
59,090

2020
57,703

 
2,824

 
60,527

2021
49,044

 
2,268

 
51,312

2022
30,612

 
2,073

 
32,685

2023
22,120

 
1,952

 
24,072

Thereafter
83,122

 
10,367

 
93,489

Total lease payments
298,660

 
22,515

 
321,175

Less: Interest
(98,081
)
 
(7,330
)
 
(105,411
)
Present value of lease liabilities
$
200,579

 
$
15,185

 
$
215,764

At December 31, 2018, future minimum annual payments under non-cancelable lease agreements with original terms in excess of one year, and including payments required under operating leases for facilities we have vacated, were as follows:
 
Total
2019
$
64,082

2020
53,138

2021
42,480

2022
26,445

2023
19,895

Thereafter
45,708

Total minimum payments
$
251,748

Rent expense for all operating leases for the year ended December 31, 2018 was $78.3 million.
Note 7—Derivatives
We are directly and indirectly affected by changes in foreign currency, which may adversely impact our financial performance and are referred to as “market risks.” When deemed appropriate, we use derivatives as a risk management tool to mitigate the potential impact of certain market risks. We do not enter into derivative financial instruments for trading purposes.
We use a layered hedging program to hedge select anticipated foreign currency cash flows to reduce volatility in cash flows. We account for the designated foreign exchange forward contracts as cash flow hedges. These foreign exchange forward contracts generally have maturities up to 12 months and the counterparties to the transactions are typically large international financial institutions.
We pay interest under our Credit Agreement which fluctuates based on changes in our benchmark interest rates. In order to mitigate the risk of increases in benchmark rates, we entered into interest rate swaps during the third quarter of 2018 whereby we agree to exchange with the counterparty, at specified intervals, the difference between fixed and variable amounts calculated by reference to the notional amount. The interest rate swaps were designated as cash flow hedges. Cash flows related to the interest rate swap agreements are included in interest expense.
We determine the fair value of our foreign currency derivatives and our interest rate swaps based on observable market-based inputs or unobservable inputs that are corroborated by market data. We do not view the fair value of our derivatives in isolation, but rather in relation to the fair values or cash flows of the underlying exposure. Our derivatives are over-the-counter instruments with liquid markets. All derivatives are carried at fair value in our consolidated balance sheets in other assets and other liabilities. We consider the risk of counterparty default to be minimal. We report cash flows from our hedging instruments in the same cash flow statement category as the hedged items.
We enter into foreign currency contracts to manage our foreign exchange exposure related to certain balance sheet items that do not meet the requirements for hedge accounting. These derivative instruments are adjusted to fair value at the end of each period through earnings. The gain or loss recorded on these instruments is substantially offset by the remeasurement adjustment on the foreign currency denominated asset or liability. We record the change in fair value of derivative instruments and the remeasurement adjustment on the foreign currency denominated asset or liability in acquisition-related and exit and realignment charges for contracts assumed with the Halyard acquisition and in other operating expense, net for all other foreign exchange contracts.

12



The following table summarizes the terms and fair value of our outstanding derivative financial instruments as of March 31, 2019:
 
 
 
 
 
Derivative Assets
 
Derivative Liabilities
 
Notional Amount
 
Maturity Date
 
Classification
 
Fair Value
 
Classification
 
Fair Value
Cash flow hedges
 
 
 
 
 
 
 
 
 
 
 
Interest rate swaps
$
450,000

 
May 2022 and 2025
 
Other assets, net
 
$

 
Other liabilities
 
$
10,969

Foreign currency contracts
$
13,448

 
June 2019 to December 2019
 
Other assets, net
 
$
317

 
Other liabilities
 
$

 
 
 
 
 
 
 
 
 
 
 
 
Economic (non-designated) hedges
 
 
 
 
 
 
 
 
 
 
 
Foreign currency contracts
$
10,610

 
April 2019 to May 2019
 
Other assets, net
 
$
229

 
Other liabilities
 
$
13

The following table summarizes the effect of cash flow hedge accounting on our consolidated statement of income for the period ended March 31, 2019:
 
Amount of Gain/(Loss) Recognized in Other Comprehensive Income (Loss)
 
Location of Gain/(Loss) Reclassified from Accumulated Other Comprehensive Income into Income
 
Total Amount of Income/(Expense) Line Items Presented in the Consolidated Statement of Income in Which the Effects are Recorded
 
Amount of Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income
Interest rate swaps
$
(4,094
)
 
Interest expense, net
 
$
(29,101
)
 
$
(321
)
Foreign currency contracts
$
445

 
Cost of goods sold
 
$
(2,102,964
)
 
$
(257
)
The amount of ineffectiveness associated with these contracts was immaterial for the periods presented.

For the period ended March 31, 2019, we recognized a gain of $0.5 million associated with our economic (non-designated) foreign currency contracts.
We were not a party to any derivatives for the period ended March 31, 2018.
Note 8—Exit and Realignment Costs
We periodically incur exit and realignment and other charges associated with optimizing our operations which includes the consolidation of certain distribution and logistics centers, administrative offices and warehouses in the United States and Europe. These charges also include costs associated with our strategic organizational realignment which include management changes, certain professional fees, and costs to streamline administrative functions and processes.

Exit and realignment charges by segment for the three months ended March 31, 2019 and 2018 were as follows:
 
Three Months Ended March 31,
 
2019
 
2018
Global Solutions segment
$
824

 
$
2,708

Global Products segment
7

 
(29
)
Total exit and realignment charges
$
831

 
$
2,679


13



The following table summarizes the activity related to exit and realignment cost and related accruals through March 31, 2019 and 2018:
 
 
Total (1)
Accrued exit and realignment costs, December 31, 2018
 
$
8,214

Provision for exit and realignment activities:
 


Severance
 
360

Information system restructuring costs
 
515

Other
 
83

Change in estimate
 
(127
)
Cash payments
 
(3,079
)
Accrued exit and realignment costs, March 31, 2019
 
$
5,966

 
 
 
 
 
 
Accrued exit and realignment costs, December 31, 2017
 
$
11,972

Provision for exit and realignment activities:
 


Severance
 
2,295

Information system restructuring costs
 
177

Other
 
230

Change in estimate
 
(23
)
Cash payments
 
(6,886
)
Accrued exit and realignment costs, March 31, 2018
 
$
7,765

(1)The accrued exit and realignment costs at March 31, 2019 and 2018 related primarily to accrued information system restructuring costs and accrued severance.
Note 9—Retirement Plans
We have a noncontributory, unfunded retirement plan for certain officers and retirees in the United States. Certain of our foreign subsidiaries also have defined benefit pension plans covering substantially all of their respective employees.
The components of net periodic benefit cost, which are included in distribution, selling and administrative expenses, for the three months ended March 31, 2019 and 2018, were as follows:
 
Three Months Ended 
 March 31,
 
2019
 
2018
Service cost
$
374

 
$
19

Interest cost
600

 
419

Recognized net actuarial loss
260

 
522

Net periodic benefit cost
$
1,234

 
$
960

Certain of our foreign subsidiaries have health and welfare plans covering substantially all of their respective employees. Our expense for these plans totaled $0.6 million and $0.5 million for the three months ended March 31, 2019 and 2018, respectively.
Note 10—Debt
Debt consists of the following:

14



 
March 31, 2019
 
December 31, 2018
 
Carrying Amount
 
Estimated Fair Value
 
Carrying Amount
 
Estimated Fair Value
3.875% Senior Notes, $275 million par value, due September 2021
$
273,684

 
$
219,307

 
$
273,577

 
$
207,001

4.375% Senior Notes, $275 million par value, due December 2024
273,079

 
177,298

 
272,972

 
174,859

Term A Loans, due July 2022
409,212

 
409,212

 
422,422

 
422,422

Term B Loan, due April 2025
482,201

 
388,050

 
483,327

 
385,284

Revolver
282,200

 
282,200

 
210,100

 
210,100

Finance leases and other
16,777

 
16,777

 
18,774

 
18,774

Total debt
1,737,153

 
1,492,844

 
1,681,172

 
1,418,440

Less current maturities
(52,018
)
 
(52,018
)
 
(30,590
)
 
(30,590
)
Long-term debt
$
1,685,135

 
$
1,440,826

 
$
1,650,582

 
$
1,387,850

We have a Credit Agreement (amended February 2019) with a borrowing capacity of $400 million and term loans. The interest rate on our revolving credit facility and Term A loans is based on the Eurocurrency Rate, the Federal Funds Rate or the Prime Rate, plus an adjustment based on our Consolidated Total Leverage Ratio as defined by the Credit Agreement. Our Term B loan accrues interest based on the Eurocurrency Rate, the Federal Funds Rate or the Prime Rate, plus interest rate margin of 3.50% per annum with respect to Base Rate Loans (as defined in the Credit Agreement), and 4.50% per annum with respect to Eurocurrency Rate Loans (as defined in the Credit Agreement). We are charged a commitment fee of between 12.5 and 25.0 basis points on the unused portion of the facility. The terms of the Credit Agreement requires us to maintain ratios for leverage and interest coverage, including on a pro forma basis in the event of an acquisition. Our credit spread at March 31, 2019 was Eurocurrency Rate plus 3.5%.
We also have a Security and Pledge Agreement (the Security Agreement) pursuant to which we granted collateral on behalf of the holders of the 2021 Notes and the 2024 Notes and parties secured on the Credit Agreement (the Secured Parties) including first priority liens and security interests in (a) all present and future shares of capital stock owned by the Credit Parties (as defined) in the Credit Parties’ present and future subsidiaries (limited, in the case of controlled foreign corporations, to a pledge of 65% of the voting capital stock of each first-tier foreign subsidiary of each Credit Party) and (b) all present and future personal property and assets of the Credit Parties, subject to certain exceptions. Our Credit Agreement has a “springing maturity date” with respect to the revolving loans and the Term A loans and the Term B loan, if as of the date that is 91 days prior to the maturity date of the Company’s 2021 Notes or the 2024 Notes, respectively, all outstanding amounts owing under the 2021 Notes or the 2024 Notes, respectively, have not been paid in full then the Termination Date (as defined in the Credit Agreement) of the revolving credit facility, Term A loans and Term B loan shall be the date that is 91 days prior to the maturity date of the 2021 Notes.
At March 31, 2019, we had letters of credit of $11.7 million outstanding under the Credit Agreement. We also had letters of credit and bank guarantees outstanding for $7.7 million as of March 31, 2019 and December 31, 2018, respectively, which supports certain facilities leased as well as other normal business activities in the United States and Europe.
The Credit Agreement and senior notes contain cross-default provisions which could result in the acceleration of payments due in the event of default of either agreement. We believe we were in compliance with our debt covenants at March 31, 2019.
As of March 31, 2019, scheduled future principal payments of debt were $37.2 million in 2019, $49.6 million in 2020, $324.7 million in 2021, $581.0 million in 2022, $5.0 million in 2023, and $748.8 million thereafter.
Note 11—Income Taxes

The effective tax rate was 2.2% for the three months ended March 31, 2019, compared to 41.6% in the same quarter of 2018. The decrease in the rate resulted from the mixture of income and losses in jurisdictions in which the company operates, including those of which require a full valuation allowance, and the incremental income tax expense associated with the vesting of restricted stock. The liability for unrecognized tax benefits was $11.2 million at March 31, 2019 and $9.6 million at December 31, 2018. Included in the liability at March 31, 2019 were $3.3 million of tax positions for which ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.

15



Note 12—Net Income per Common Share
The following summarizes the calculation of net income per common share attributable to common shareholders for the three months ended March 31, 2019 and 2018:
 
Three Months Ended 
 March 31,
(in thousands, except per share data)
2019
 
2018
Numerator:
 
 
 
Net income (loss)
$
(14,096
)
 
$
8,151

Less: income allocated to unvested restricted shares

 
(323
)
Net income (loss) attributable to common shareholders - basic and diluted
$
(14,096
)
 
$
7,828

Denominator:
 
 
 
Weighted average shares outstanding - basic and diluted
60,376

 
59,969

Net income (loss) per share attributable to common shareholders:
 
 
 
Basic and diluted
$
(0.23
)
 
$
0.13

Note 13—Shareholders’ Equity
Our Board of Directors authorized a share repurchase program of up to $100 million of our outstanding common stock to be executed at the discretion of management over a 3-year period, expiring in December 2019. The timing of repurchases and the exact number of shares of common stock to be purchased will depend upon market conditions and other factors and may be suspended or discontinued at any time. Purchases under the share repurchase program are made either pursuant to 10b5-1 plans entered into by the company from time to time and/or during the company’s scheduled quarterly trading windows for officers and directors. Our Credit Agreement contains restrictions on the amount and timing of share repurchase activity. This includes prohibiting share repurchases should a default under the Credit Agreement exist prior to or immediately after any share repurchases. We did not repurchase any shares of our common stock during the quarters ended March 31, 2019 and 2018. As of March 31, 2019, we have approximately $94.0 million in remaining authorization available under the repurchase program. We have elected to allocate any excess of share repurchase price over par value to retained earnings.

16



Note 14—Accumulated Other Comprehensive Income (Loss)
The following table shows the changes in accumulated other comprehensive income (loss) by component for the three months ended March 31, 2019 and 2018: 
 
Retirement Plans
 
Currency
Translation
Adjustments
 
Derivatives and Other
 
Total
Accumulated other comprehensive income (loss), December 31, 2018
$
(8,146
)
 
$
(32,551
)
 
$
(4,915
)
 
$
(45,612
)
Other comprehensive income (loss) before reclassifications

 
(4,207
)
 
(3,649
)
 
(7,856
)
Income tax

 

 
808

 
808

Other comprehensive income (loss) before reclassifications, net of tax

 
(4,207
)
 
(2,841
)
 
(7,048
)
Amounts reclassified from accumulated other comprehensive income (loss)
266

 

 
578

 
844

Income tax
(69
)
 

 
(150
)
 
(219
)
Amounts reclassified from accumulated other comprehensive income (loss), net of tax
197

 

 
428

 
625

Other comprehensive income (loss)
197

 
(4,207
)
 
(2,413
)
 
(6,423
)
Accumulated other comprehensive income (loss), March 31, 2019
$
(7,949
)
 
$
(36,758
)
 
$
(7,328
)
 
$
(52,035
)
 
Retirement Plans
 
Currency
Translation
Adjustments
 
Derivatives and Other
 
Total
Accumulated other comprehensive income (loss), December 31, 2017
$
(12,066
)
 
$
(13,185
)
 
$
167

 
$
(25,084
)
Other comprehensive income (loss) before reclassifications

 
8,921

 
6

 
8,927

Income tax

 

 

 

Other comprehensive income (loss) before reclassifications, net of tax

 
8,921

 
6

 
8,927

Amounts reclassified from accumulated other comprehensive income (loss)
522

 

 


 
522

Income tax
(142
)
 

 

 
(142
)
Amounts reclassified from accumulated other comprehensive income (loss), net of tax
380

 

 

 
380

Other comprehensive income (loss)
380

 
8,921

 
6

 
9,307

Accumulated other comprehensive income (loss), March 31, 2018
$
(11,686
)
 
$
(4,264
)
 
$
173

 
$
(15,777
)
We include amounts reclassified out of accumulated other comprehensive income (loss) related to defined benefit pension plans as a component of net periodic pension cost recorded in distribution, selling and administrative expenses. For the three months ended March 31, 2019 and 2018, we reclassified $0.3 million and $0.5 million, respectively, of actuarial net losses.
Note 15—Segment Information
We periodically evaluate our application of accounting guidance for reportable segments and disclose information about reportable segments based on the way management organizes the enterprise for making operating decisions and assessing performance. We report our business under two segments: Global Solutions and Global Products. The Global Solutions segment includes our United States and European distribution, logistics and value-added services business. Global Products manufactures and sources medical surgical products through our production and kitting operations. The Halyard business, acquired on April 30, 2018, is part of Global Products.
We evaluate the performance of our segments based on their operating income excluding intangible amortization, acquisition-related and exit and realignment charges, certain purchase price fair value adjustments, and other substantive items

17



that, either as a result of their nature or size, would not be expected to occur as part of our normal business operations on a regular basis.
Segment assets exclude inter-segment account balances as we believe their inclusion would be misleading and not meaningful. We believe all inter-segment sales are at prices that approximate market.
The following tables present financial information by segment:
 
Three Months Ended March 31,
 
2019
 
2018
Net revenue:
 
 
 
Segment net revenue
 
 
 
Global Solutions
$
2,234,147

 
$
2,341,122

Global Products
347,085

 
121,287

Total segment net revenue
2,581,232

 
2,462,409

Inter-segment revenue
 
 
 
Global Products
(119,844
)
 
(89,830
)
       Total inter-segment revenue
(119,844
)
 
(89,830
)
Consolidated net revenue
$
2,461,388

 
$
2,372,579

 
 
 
 
Operating income (loss):
 
 
 
Global Solutions
$
21,071

 
$
36,759

Global Products
7,724

 
11,084

Inter-segment eliminations
1,747

 
(242
)
Intangible amortization
(10,361
)
 
(6,407
)
Acquisition-related and exit and realignment charges
(4,990
)
 
(14,760
)
Other (1)
(499
)
 
(2,217
)
Consolidated operating income
$
14,692

 
$
24,217

 
 
 
 
Depreciation and amortization:
 
 
 
Global Solutions
$
16,113

 
$
15,781

Global Products
12,607

 
2,130

Consolidated depreciation and amortization
$
28,720

 
$
17,911

 
 
 
 
Capital expenditures:
 
 
 
Global Solutions
$
11,376

 
$
13,602

Global Products
2,903

 
558

Consolidated capital expenditures
$
14,279

 
$
14,160

(1) Other consists of Software as a Service (SaaS) implementation costs associated with significant global IT platforms in connection with the redesign of our global information system strategy.


18



 
March 31, 2019
 
December 31, 2018
Total assets:
 
 
 
Global Solutions
$
2,673,148

 
$
2,618,759

Global Products
1,133,977

 
1,051,662

Segment assets
3,807,125

 
3,670,421

Cash and cash equivalents
75,239

 
103,367

Consolidated total assets
$
3,882,364

 
$
3,773,788

The following table presents net revenue by geographic area, which were attributed based on the location from which we ship products or provide services.
 
Three Months Ended March 31,
 
2019
 
2018
Net revenue:
 
 
 
United States
$
2,303,913

 
$
2,252,634

International
157,475

 
119,945

Consolidated net revenue
$
2,461,388

 
$
2,372,579

Note 16—Condensed Consolidating Financial Information
The following tables present condensed consolidating financial information for: Owens & Minor, Inc. (O&M); the guarantors of Owens & Minor, Inc.’s 2021 Notes and 2024 Notes, on a combined basis; and the non-guarantor subsidiaries of the 2021 Notes and 2024 Notes, on a combined basis. The guarantor subsidiaries are 100% owned by Owens & Minor, Inc. Separate financial statements of the guarantor subsidiaries are not presented because the guarantees by our guarantor subsidiaries are full and unconditional, as well as joint and several, and we believe the condensed consolidating financial information is more meaningful in understanding the financial position, results of operations and cash flows of the guarantor subsidiaries. The prior period has been recasted for the change in guarantor structure as a result of the amended Credit Agreement.
Three Months Ended March 31, 2019
Owens &
Minor, Inc.
 
Guarantor
Subsidiaries
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Statements of Income
 
 
 
 
 
 
 
 
 
Net revenue
$

 
$
2,371,809

 
$
337,876

 
$
(248,297
)
 
$
2,461,388

Cost of goods sold

 
2,101,290

 
251,419

 
(249,745
)
 
2,102,964

Gross margin

 
270,519

 
86,457

 
1,448

 
358,424

Distribution, selling and administrative expenses

 
231,591

 
107,112

 

 
338,703

Acquisition-related and exit and realignment charges

 
4,721

 
269

 

 
4,990

Other operating expense, net

 
(426
)
 
465

 

 
39

Operating income

 
34,633

 
(21,389
)
 
1,448

 
14,692

Interest expense, net
7,488

 
18,467

 
3,146

 

 
29,101

Income (loss) before income taxes
(7,488
)
 
16,166

 
(24,535
)
 
1,448

 
(14,409
)
Income tax (benefit) provision
(771
)
 
(816
)
 
1,274

 

 
(313
)
Equity in earnings of subsidiaries
(7,379
)
 
(957
)
 

 
8,336

 

Net income (loss)
(14,096
)
 
16,025

 
(25,809
)
 
9,784

 
(14,096
)
Other comprehensive income (loss)
(6,423
)
 
(3,393
)
 
(4,157
)
 
7,550

 
(6,423
)
Comprehensive income (loss)
$
(20,519
)
 
$
12,632

 
$
(29,966
)
 
$
17,334

 
$
(20,519
)

19



Three Months Ended March 31, 2018
Owens &
Minor, Inc.
 
Guarantor
Subsidiaries
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Statements of Income
 
 
 
 
 
 
 
 
 
Net revenue
$

 
$
2,228,490

 
$
183,637

 
$
(39,548
)
 
$
2,372,579

Cost of goods sold

 
1,994,151

 
93,212

 
(39,471
)
 
2,047,892

Gross margin

 
234,339

 
90,425

 
(77
)
 
324,687

Distribution, selling and administrative expenses
(179
)
 
196,369

 
88,171

 

 
284,361

Acquisition-related and exit and realignment charges

 
13,815

 
945

 

 
14,760

Other operating expense, net

 
(583
)
 
1,932

 

 
1,349

Operating income
179

 
24,738

 
(623
)
 
(77
)
 
24,217

Interest expense, net
6,741

 
1,991

 
1,521

 

 
10,253

Income (loss) before income taxes
(6,562
)
 
22,747

 
(2,144
)
 
(77
)
 
13,964

Income tax (benefit) provision

 
4,456

 
1,357

 

 
5,813

Equity in earnings of subsidiaries
14,713

 
150

 

 
(14,863
)
 

Net income (loss)
8,151

 
18,441

 
(3,501
)
 
(14,940
)
 
8,151

Other comprehensive income (loss)
9,307

 
9,363

 
8,921

 
(18,284
)
 
9,307

Comprehensive income (loss)
$
17,458

 
$
27,804

 
$
5,420

 
$
(33,224
)
 
$
17,458


20



 
 
March 31, 2019
Owens &
Minor, Inc.
 
Guarantor
Subsidiaries
 
Non-
guarantor
Subsidiaries
 
Eliminations
 
Consolidated
 
 
Balance Sheets
 
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
 
 
Current assets
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
5,971

 
$
43,611

 
$
25,657

 
$

 
$
75,239

 
Accounts receivable, net

 
887,822

 
598,948

 
(643,386
)
 
843,384

 
Merchandise inventories

 
980,441

 
233,425

 
(3,308
)
 
1,210,558

 
Other current assets
29

 
99,190

 
236,846

 

 
336,065

 
Total current assets
6,000

 
2,011,064

 
1,094,876

 
(646,694
)
 
2,465,246

 
Property and equipment, net

 
197,088

 
189,047

 

 
386,135

 
Operating lease assets
2,768

 
128,775

 
65,657

 

 
197,200

 
Goodwill

 
413,235

 

 

 
413,235

 
Intangible assets, net

 
269,143

 
42,111

 

 
311,254

 
Due from O&M and subsidiaries

 
988,509

 

 
(988,509
)
 

 
Advances to and investment in consolidated subsidiaries
1,689,812

 
88,164

 

 
(1,777,976
)
 

 
Other assets, net

 
52,910

 
56,384

 

 
109,294

 
Total assets
$
1,698,580

 
$
4,148,888

 
$
1,448,075

 
$
(3,413,179
)
 
$
3,882,364

 
Liabilities and equity
 
 
 
 
 
 
 
 
 
 
Current liabilities
 
 
 
 
 
 
 
 
 
 
Accounts payable
$

 
$
1,233,448

 
$
411,353

 
$
(654,113
)
 
$
990,688

 
Accrued payroll and related liabilities

 
20,714

 
20,285

 

 
40,999

 
Other current liabilities
5,488

 
222,202

 
150,299

 

 
377,989

 
Total current liabilities
5,488

 
1,476,364

 
581,937

 
(654,113
)
 
1,409,676

 
Long-term debt, excluding current portion
626,771

 
1,044,342

 
14,022

 

 
1,685,135

 
Operating lease liabilities, excluding current portion
1,661

 
108,810

 
45,232

 

 
155,703

 
Due to O&M and subsidiaries
552,974

 

 
683,403

 
(1,236,377
)
 

 
Intercompany debt

 
1,246,785

 
322,105

 
(1,568,890
)
 

 
Deferred income taxes

 
16,829

 
25,315

 

 
42,144

 
Other liabilities
9,847

 
58,994

 
19,026

 

 
87,867

 
Total liabilities
1,196,741

 
3,952,124

 
1,691,040

 
(3,459,380
)
 
3,380,525

 
Equity
 
 
 
 
 
 
 
 
 
 
Common stock
125,872

 

 

 

 
125,872

 
Paid-in capital
241,547

 
174,614

 
123,865

 
(298,479
)
 
241,547

 
Retained earnings (deficit)
186,455

 
53,802

 
(345,445
)
 
291,643

 
186,455

 
Accumulated other comprehensive income (loss)
(52,035
)
 
(31,652
)
 
(21,385
)
 
53,037

 
(52,035
)
 
Total equity
501,839

 
196,764

 
(242,965
)
 
46,201

 
501,839

 
Total liabilities and equity
$
1,698,580

 
$
4,148,888

 
$
1,448,075

 
$
(3,413,179
)
 
$
3,882,364


21



December 31, 2018
Owens &
Minor, Inc.
 
Guarantor
Subsidiaries
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Balance Sheets
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
 
Current assets


 


 


 


 


Cash and cash equivalents
$
37,254

 
$
5,294

 
$
60,819

 
$

 
$
103,367

Accounts receivable, net

 
804,638

 
482,675

 
(463,895
)
 
823,418

Merchandise inventories

 
1,060,083

 
234,778

 
(4,758
)
 
1,290,103

Other current assets
117

 
117,163

 
205,678

 
(1,268
)
 
321,690

       Total current assets
37,371

 
1,987,178

 
983,950

 
(469,921
)
 
2,538,578

Property and equipment, net

 
201,055

 
185,668

 

 
386,723

Goodwill

 
414,122

 

 

 
414,122

Intangible assets, net

 
290,814

 
30,950

 

 
321,764

Due from O&M and subsidiaries

 
880,901

 

 
(880,901
)
 

Advances to and investments in consolidated subsidiaries
1,697,191

 
93,278

 

 
(1,790,469
)
 

Other assets, net
1,788

 
56,221

 
54,592

 

 
112,601

        Total assets
$
1,736,350

 
$
3,923,569

 
$
1,255,160

 
$
(3,141,291
)
 
$
3,773,788

Liabilities and equity
 
 
 
 
 
 
 
 
 
Current liabilities


 


 


 


 


Accounts payable
$

 
$
1,190,283

 
$
394,664

 
$
(475,358
)
 
$
1,109,589

Accrued payroll and related liabilities

 
23,071

 
25,132

 

 
48,203

Other current liabilities
9,641

 
161,371

 
143,207

 

 
314,219

       Total current liabilities
9,641

 
1,374,725

 
563,003

 
(475,358
)
 
1,472,011

Long-term debt, excluding current portion
595,856

 
1,040,664

 
14,062

 

 
1,650,582

Due to O&M and subsidiaries
605,558

 

 
67,900

 
(673,458
)
 

Intercompany debt

 
1,246,787

 
322,101

 
(1,568,888
)
 

Deferred income taxes

 
29,288

 
21,564

 

 
50,852

Other liabilities
6,876

 
51,366

 
23,682

 

 
81,924

        Total liabilities
1,217,931

 
3,742,830

 
1,012,312

 
(2,717,704
)
 
3,255,369

Equity


 


 


 


 


Common stock
124,588

 

 

 

 
124,588

Paid-in capital