Integra LifeSciences Reports Fourth Quarter and Full-Year 2023 Financial Results and Provides 2024 Financial Guidance

PRINCETON, N.J., Feb. 28, 2024 (GLOBE NEWSWIRE) -- Integra LifeSciences Holdings Corporation (NASDAQ: IART) today reported financial results for the fourth quarter and full year ended December 31, 2023.

Fourth Quarter 2023

  • Reported revenues were $397.0 million, representing a decrease of 0.2% on a reported basis and a decrease of 1.2% on an organic basis compared to the fourth quarter 2022. Revenue increased 3.6% on an organic basis excluding Boston.
  • GAAP earnings per diluted share were $0.25, compared to $0.63 in the fourth quarter 2022.
  • Adjusted earnings per diluted share were $0.89, compared to $0.94 in the fourth quarter of 2022.

Full-Year 2023

  • Reported revenues were $1,541.6 million representing a decrease of 1.0% on a reported basis and flat on an organic basis compared to full-year 2022. Revenue increased 5.5% on an organic basis excluding Boston.
  • GAAP earnings per diluted share were $0.84, compared to $2.16 in 2022.
  • Adjusted earnings per diluted share were $3.10, compared to $3.36 in 2022.

Business Highlights

  • Boston relaunch remains on track for mid-to-late Q2 2024
  • Completed global CereLink® relaunch with 510k clearance and US relaunch in Q1 2024
  • Successful integration of the SIA acquisition
  • Advanced PMA clinical strategy for SurgiMend® and DuraSorb®
  • International portfolio expansion of DuraGen®, CUSA®, and 100+ product registrations
  • Building-out in-China-for-China manufacturing capability
  • Obtained 510(k) for next generation Aurora® Surgiscope
  • Signed definitive agreement to acquire the Acclarent® ENT business by Q2 2024
  • Executed $275M in share repurchases
  • Upgraded Quality Management System with investments in talent and process capabilities

"In 2023, we saw stability in our markets and resilience of our product portfolio, which demonstrates the impact of our products and technologies on restoring patients’ lives," said Jan De Witte, president and chief executive officer "Despite the operational challenges last year, I am extremely proud of our colleagues around the world for remaining focused on advancing our key pillars of growth and operational excellence, and for their unwavering commitment to our customers and patients.”

Fourth Quarter 2023 Financial Summary

Total reported revenues for the fourth quarter were 397.0 million, a decrease of 0.2% from the fourth quarter of 2022. Fourth quarter organic revenues were down 1.2% compared to the prior year. Revenue increased 3.6% on an organic basis excluding Boston.

The Company reported GAAP net income of $19.8 million, or $0.25 per diluted share, in the fourth quarter of 2023, compared to GAAP net income of $52.9 million, or $0.63 per diluted share, in the prior year.

Adjusted EBITDA for the fourth quarter of 2023 was $100.5 million, compared to $109.7 million in the fourth quarter of the prior year. As a percentage of revenue, adjusted EBITDA was 25.3%, a decrease of 230 basis points from the prior year period.

Adjusted net income for the fourth quarter of 2023 was $69.1 million, or $0.89 per diluted share, compared to adjusted net income of $78.8 million, or $0.94 per diluted share, in the fourth quarter of 2022.

Cash flows from operations totaled $58.7M million in the fourth quarter and capital expenditures were $24.6M million.

Fourth Quarter 2023 Segment Performance

  • Codman Specialty Surgical (69% of Revenues)
    • Total revenues were $271.6 million, representing reported an increase of 2.7% and organic growth of 2.3% compared to the fourth quarter of 2022. Sales in Neurosurgery grew 2.0% on an organic basis.
      • CSF management had mid-single digit growth driven by Certas® Plus valves.
      • Mid-single-digit growth in dural access and repair driven by DuraGen, partially offset by a decline in DuraSeal.
      • Neuro monitoring grew low-single digits driven by BactiSeal® catheters and ICP microsensors.
      • Advanced energy was down by low-single digits driven by lower CUSA® capital sales.
    • Sales in Instruments grew 3.0% on an organic basis.
  • Tissue Technologies (31% of Revenue)
    • Total revenues were $125.4 million, representing a decrease of 6.0% on a reported basis and organic decline of 8.0% compared to the fourth quarter of 2022 due to the impact of the lost revenue related to the Boston product recall which was partially offset by double digit growth from BioD® and Gentrix® and mid-single digit growth in Integra skin and MediHoney®.

Full-Year 2023 Financial Summary

Total reported revenues for the full-year 2023 were $1,541.6 million, a decrease of 1.0%, from the prior year. Organic sales for the full-year 2023 were flat compared to 2022. Revenue increased 5.5% on an organic basis excluding Boston.

The Company reported GAAP net income of $67.7 million, or $0.84 per diluted share, for the full-year 2023, compared to GAAP net income of $180.6 million, or $2.16 per diluted share in 2022.

Adjusted EBITDA for the full-year 2023 was $369.7 million, a decrease of $41.6 million versus the prior year. Full year EBITDA margins were 24.0% a decrease of 240 basis points from the prior year.

Adjusted net income for the full-year 2023 was $247.8 million, or $3.10 per diluted share, compared to $280.9 million, or $3.36 per diluted share.

2023 Balance Sheet, Cash Flow and Capital Allocation

The Company generated cash flow from operations of $140.0 million for the full-year 2023. Full-year capital expenditures were $67.0 million. Net debt at the end of the year was $1.2 billion, and the consolidated total leverage ratio was 3.0x. As of year-end, the Company had total liquidity of approximately $1.5 billion, including approximately $309 million in cash plus short-term investments and the remainder available under its revolving credit facility.

2024 Revenue and Adjusted Earnings Per Share Guidance

The Company’s guidance for 2024 revenue and adjusted earnings per share reflects the stability of our markets and strong demand for our differentiated portfolio, gradual improvement in supply over the year, continued international expansion and the relaunch of the Boston portfolio late second quarter. Our guidance excludes the pending acquisition of the Acclarent ENT business.

For the full-year 2024, the Company expects revenues to be in a range of $1,603 million to $1,618 million, representing reported growth of approximately 4.0% to 5.0% and organic growth in the range of 4.0% to 5.0%. Adjusted earnings per diluted share are expected to be between $3.15 and $3.25.

For the first quarter 2024, the Company expects reported revenues in the range of $360 million to $365 million, representing reported growth of approximately -5.5% to -4.1% and organic growth of approximately -5.1% to -3.7%. Adjusted earnings per diluted share are expected to be in a range of $0.53 to $0.57.

Organic sales growth excludes acquisitions and divestitures as well as the effects of foreign currency.

The Company is providing forward-looking guidance regarding adjusted earnings per diluted share but is not providing a reconciliation to GAAP earnings per share, because certain GAAP expense items are highly variable, and management is unable to predict them with reasonable certainty and without unreasonable effort. Specifically, the financial impact and timing of divestitures, acquisitions, integrations, structural optimization and efforts to comply with the EU Medical Device Regulation are uncertain, depend on various dynamic factors and are not reasonably ascertainable at this time. These expense items could have a material impact on GAAP results.

Conference Call and Presentation Available Online

Integra has scheduled a conference call for 8:30 a.m. ET on Wednesday, February 28, 2024, to discuss fourth quarter and full-year 2023 financial results, and forward-looking financial guidance. The conference call will be hosted by Integra's senior management team and will be open to all listeners. Additional forward-looking information may be discussed in a question-and-answer session following the call. Integra's management team will reference a presentation during the conference call, which can be found on the Investor Relations section of the website at investor.integralife.com.

A live webcast will be available on the Investors section of the Company’s website at investor.integralife.com. For those planning to participate on the call, please register here to receive dial-in details and a unique pin. While not required, it is recommended to join 10 minutes prior to the start of the event. A webcast replay of the conference call will be available on the Investor Relations section of the Company’s website following the call.

About Integra

At Integra LifeSciences, we are driven by our purpose of restoring patients’ lives. We innovate treatment pathways to advance patient outcomes and set new standards of surgical, neurologic, and regenerative care. We offer a comprehensive portfolio of high quality, leadership brands that include AmnioExcel®, Aurora®, Bactiseal®, BioD™, CerebroFlo®, CereLink® Certas® Plus, Codman®, CUSA®, Cytal®, DuraGen®, DuraSeal®, DuraSorb®, Gentrix®, ICP Express®, Integra®, Licox®, MAYFIELD®, MediHoney®, MicroFrance®, MicroMatrix®, NeuraGen®, NeuraWrap™, PriMatrix®, SurgiMend®, TCC-EZ® and VersaTru®. For the latest news and information about Integra and its products, please visit www.integralife.com.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties and reflect the Company's judgment as of the date of this release. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements. Some of these forward-looking statements may contain words like “will,” “believe,” “may,” “could,” “would,” “might,” “possible,” “should,” “expect,” “intend,” "forecast," "guidance," “plan,” “anticipate,” "target," or “continue,” the negative of these words, other terms of similar meaning or they may use future dates. Forward-looking statements contained in this news release include, but are not limited to, statements concerning future financial performance, including projections for revenues, expected revenue growth (both reported and organic), GAAP and adjusted net income, GAAP and adjusted earnings per diluted share, non-GAAP adjustments such as divestiture, acquisition and integration-related charges, intangible asset amortization, structural optimization charges, EU Medical Device Regulation-related charges, charges related to the voluntary global recall of all products manufactured at the Company’s facility in Boston, Massachusetts, and income tax expense (benefit) related to non-GAAP adjustments and other items, expectations and plans with respect to strategic initiatives, product development and regulatory approvals and expectations concerning the resumption of manufacturing at the Company’s Boston, Massachusetts facility. It is important to note that the Company’s goals and expectations are not predictions of actual performance. Such forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from predicted or expected results. Such risks and uncertainties include, but are not limited, to the following: the ongoing and possible future effects of global challenges, including macroeconomic uncertainties, inflation, supply chain disruptions, trade regulation and tariffs, other economic disruptions and U.S. and global recession concerns, on the Company’s customers and on the Company’s business, financial condition, results of operations and cash flows; the Company's ability to execute its operating plan effectively; the Company’s ability to successfully integrate acquired businesses; the Company’s ability to achieve sales growth in a timely fashion; the Company's ability to manufacture and ship sufficient quantities of its products to meet its customers' demands; the ability of third-party suppliers to supply us with raw materials and finished products; global macroeconomic and political conditions, including the war in Ukraine and the conflict in Israel and Gaza; the Company's ability to manage its direct sales channels effectively; the sales performance of third-party distributors on whom the Company relies to generate revenue for certain products and geographic regions; the Company's ability to access and maintain relationships with customers of acquired entities and businesses; physicians' willingness to adopt and third-party payors' willingness to provide or maintain reimbursement for the Company's recently launched, planned and existing products; initiatives launched by the Company's competitors; downward pricing pressures from customers; the Company's ability to secure regulatory approval for products in development; the Company's ability to remediate quality systems violations; fluctuations in hospitals' spending for capital equipment; the Company's ability to comply with regulations regarding products of human origin and products containing materials derived from animal source; difficulties in controlling expenses, including costs to procure and manufacture our products; the impact of changes in management or staff levels; the impact of goodwill and intangible asset impairment charges if future operating results of acquired businesses are significantly less than the results anticipated at the time of the acquisitions, the Company's ability to leverage its existing selling organizations and administrative infrastructure; the Company's ability to increase product sales and gross margins, and control non-product costs; the Company’s ability to achieve anticipated growth rates, margins and scale and execute its strategy generally; the amount and timing of divestiture, acquisition and integration-related costs; the geographic distribution of where the Company generates its taxable income; new U.S. and foreign government laws and regulations, and changes in existing laws, regulations and enforcement guidance, which affect areas of our operations including, but not limited to, those affecting the health care industry, including the EU Medical Devices Regulation; the scope, duration and effect of additional U.S. and international governmental, regulatory, fiscal, monetary and public health responses to the COVID-19 pandemic and any future public health crises; fluctuations in foreign currency exchange rates; the amount of our bank borrowings outstanding and other factors influencing liquidity; potential negative impacts resulting from environmental, social and governance matters; and the economic, competitive, governmental, technological, and other risk factors and uncertainties identified under the heading “Risk Factors” included in Item 1A of Integra's Annual Report on Form 10-K for the year ended December 31, 2023 to be filed with the Securities and Exchange Commission.

These forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events, or otherwise.

Discussion of Adjusted Financial Measures

In addition to our GAAP results, we provide certain non-GAAP measures, including organic revenues, organic revenues excluding Boston, adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA"), adjusted net income, adjusted earnings per diluted share, free cash flow, adjusted free cash flow conversion, and net debt. Organic revenues consist of total revenues excluding the effects of currency exchange rates, revenues from current-period acquisitions and product divestitures. Organic revenues excluding Boston consist of total revenues, excluding (i) the effects of currency exchange rates, revenues from current-period acquisitions and product divestitures and discontinuances and (ii) revenues associated with Boston produced products including sales reported prior to the recall and the impact of sales return provisions recorded. Adjusted EBITDA consists of GAAP net income excluding: (i) depreciation and amortization; (ii) other income (expense); (iii) interest income and expense; (iv) income tax expense (benefit); and (v) those operating expenses also excluded from adjusted net income. The measure of adjusted net income consists of GAAP net income, excluding: (i) structural optimization charges; (ii) divestiture, acquisition and integration-related charges; (iii) EU Medical Device Regulation-related charges; (iv) charges related to the voluntary global recall of products manufactured at the Company’s Boston, Massachusetts facility; (v) intangible asset amortization expense; and (vi) income tax impact from adjustments. The adjusted earnings per diluted share measure is calculated by dividing adjusted net income attributable to diluted shares by diluted weighted average shares outstanding. The measure of free cash flow consists of GAAP net cash provided by operating activities less purchases of property and equipment. The adjusted free cash flow conversion measure is calculated by dividing free cash flow by adjusted net income. The measure of net debt consists of GAAP total debt (excluding deferred financing costs) less short-term investments, cash and cash equivalents.

Reconciliations of GAAP revenues to organic revenues, GAAP revenues to organic revenues excluding Boston, and GAAP net income to adjusted EBITDA and adjusted net income, GAAP total debt to net debt, and GAAP earnings per diluted share to adjusted earnings per diluted share all for the quarters and years ended December 31, 2023 and 2022, and the free cash flow and adjusted free cash flow conversion for the quarters and years ended December 31, 2023 and 2022, appear in the financial tables in this release.

The Company believes that the presentation of organic revenues and the other non-GAAP measures provide important supplemental information to management and investors regarding financial and business trends relating to the Company's financial condition and results of operations. For further information regarding why Integra believes that these non-GAAP financial measures provide useful information to investors, the specific manner in which management uses these measures, and some of the limitations associated with the use of these measures, please refer to the Company's Current Report on Form 8-K regarding this earnings press release filed today with the Securities and Exchange Commission. This Current Report on Form 8-K is available on the SEC's website at www.sec.gov or on our website at www.integralife.com.

Investor Relations Contact:

Chris Ward
(609) 772-7736
chris.ward@integralife.com

Media Contact:

Laurene Isip
(609) 208-8121
laurene.isip@integralife.com

 
INTEGRA LIFESCIENCES HOLDINGS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)
 
(In thousands, except per share amounts)
 
  Three Months Ended
December 31,
  Twelve Months Ended
December 31,
  2023     2022     2023     2022  
Total revenues 397,039     398,022     1,541,573     1,557,666  
               
Costs and expenses:              
Cost of goods sold 170,546     147,937     656,838     587,355  
Research and development 24,284     26,783     104,192     101,193  
Selling, general and administrative 163,128     151,919     656,641     616,316  
Intangible asset amortization 3,034     3,543     12,376     13,882  
Total costs and expenses 360,992     330,182     1,430,047     1,318,746  
Operating income 36,047     67,840     111,526     238,920  
Interest income 4,549     5,311     17,202     11,917  
Interest expense (13,751 )   (12,894 )   (51,377 )   (49,594 )
Gain (loss) from the sale of business             644  
Other income, net 2,013     3,951     3,718     12,007  
Income before taxes 28,858     64,208     81,069     213,894  
Income tax expense (benefit) 9,024     11,262     13,328     33,344  
Net income 19,834     52,946     67,741     180,550  
               
Net income per share:              
Diluted net income per share 0.25     0.63     0.84     2.16  
Weighted average common shares outstanding for diluted net income per share 77,959     83,568     80,337     83,516  

Segment revenues and growth in total revenues excluding the effects of currency exchange rates, acquisitions and discontinued products are as follows:

(In thousands)

  Three Months Ended

December 31,
  Twelve Months Ended

December 31,
  2023   2022   Change   2023   2022   Change
Neurosurgery 210,204   205,199   2.4%   818,101   794,017   3.0%
Instruments 61,423   59,398   3.4%   240,892   225,547   6.8%
Total Codman Specialty Surgical 271,627   264,597   2.7%   1,058,993   1,019,564   3.9%
               
Wound Reconstruction and Care 93,859   102,540   (8.5)%   373,986   406,689   (8.0)%
Private Label 31,553   30,885   2.2%   108,594   131,413   (17.4)%
Total Tissue Technologies 125,412   133,425   (6.0)%   482,580   538,102   (10.3)%
Total Reported Revenues 397,039   398,022   (0.2)%   1,541,573   1,557,666   (1.0)%
               
Impact of changes in currency exchange rates (928 )     6,817    
Less contribution of revenues from acquisitions (2,548 )     (9,753 )  
Less contribution of revenues from divested products   (122 )   (245 ) (18,063 )
Less contribution of revenues from discontinued products (2,068 ) (1,600 )   (6,604 ) (7,876 )
Total organic revenues(1) 391,496   396,300   (1.2)%   1,531,788   1,531,727   —%
               
Boston Revenue impact (1,005 ) (19,543 )     (2,759 ) (83,077 )  
Total Organic Revenues ex Boston 390,491   376,756       1,529,029   1,448,650    
               

(1) Organic revenues have been adjusted to exclude foreign currency (current period), acquisitions and to account for divested and discontinued products.

Items included in GAAP net income and from continuing operations and locations where each item is recorded are as follows:

(In thousands)

Three Months Ended December 31, 2023    
     
Item Total
Amount
  COGS(a)   SG&A(b)   R&D(c)   Amort.(d)   OI&E(e)   Tax(f)
Acquisition, divestiture and integration-related charges 7,117     73   8,040   (880 )     (116 )    
Structural Optimization charges 7,998     4,859   3,155   (16 )          
EU Medical Device Regulation charges 12,387     2,227   4,653   5,507            
Boston Recall 6,346     5,587   759                  
Intangible asset amortization expense 20,687     17,653         3,034        
Estimated income tax impact from above adjustments and other items (5,272 )                 (5,272 )
Depreciation expense 9,834                    
                               
(a) COGS - Cost of goods sold
(b) SG&A - Selling, general and administrative
(c) R&D - Research & development
(d) Amort. - Intangible asset amortization
(e) OI&E - Other income & expense
(f) Tax - Income tax expense (benefit)
   
                               
Three Months Ended December 31, 2022
                     
Item Total
Amount
  COGS(a) SG&A(b)   R&D(c)   Amort.(d)     OI&E(e)   Tax(f)
Acquisition, divestiture and integration-related charges(1) 704     619   620   477         (1,013 )    
Structural Optimization charges (1,533 )   (4,195 ) 2,669   (7 )            
EU Medical Device Regulation charges 12,177     1,439   4,855   5,884              
Intangible asset amortization expense 19,632     16,089         3,543          
Estimated income tax impact from above adjustments and other items (5,091 )                   (5,091 )
Depreciation expense 9,861                      
                     
(a) COGS - Cost of goods sold
(b) SG&A - Selling, general and administrative
(c) R&D - Research and development
(d) Amort. - Intangible asset amortization
(e) OI&E - Other income and expense
(f) Tax - Income tax expense
                     

Items included in GAAP net income and location where each item is recorded are as follows:

(In thousands)

Twelve Months Ended December 31, 2023    
                               
Item Total
Amount
  COGS(a)   SG&A(b)   R&D(c)   Amort.(d)   OI&E(e)   Tax(f)
Acquisition, divestiture and integration-related charges 25,173     3,045   25,181   (2,188 )     (865 )    
Structural Optimization charges 23,020     15,144   7,943   (67 )          
EU Medical Device Regulation charges 46,559     5,813   20,002   20,745            
Boston Recall 40,034     39,181   853                  
Intangible asset amortization expense 82,823     70,447         12,376        
Estimated income tax impact from above adjustments and other items (37,573 )                 (37,573 )
Depreciation expense 39,704                    
                                   
(a) COGS - Cost of goods sold
(b) SG&A - Selling, general and administrative
(c) R&D - Research and development
(d) Amort. - Intangible asset amortization
(e) OI&E - Interest (income) expense, net and other (income), net
(f) Tax - Income tax expense
   
                                   
Twelve Months Ended December 31, 2022
                       
Item Total
Amount
  COGS(a)   SG&A(b)   R&D(c)   Amort.(d)   OI&E(e)   Tax(f)
Acquisition, divestiture and integration-related charges (18,849 )   1,543   (13,379 )   (2,195 )     (4,818 )    
Structural Optimization charges 23,072     5,554   17,368     150            
EU Medical Device Regulation charges 45,147     4,626   16,596     23,926            
Intangible asset amortization expense 78,295     64,413           13,882        
Estimated income tax impact from above adjustments and other items (27,349 )                   (27,349 )
Depreciation expense 39,943                      
                       
(a) COGS - Cost of goods sold
(b) SG&A - Selling, general and administrative
(c) R&D - Research and development
(d) Amort. - Intangible asset amortization
(e) OI&E - Interest (income) expense, net and other (income), net
(f) Tax - Income tax expense
 
INTEGRA LIFESCIENCES HOLDINGS CORPORATION
RECONCILIATION OF NON-GAAP ADJUSTMENTS - GAAP NET INCOME FROM CONTINUING OPERATIONS TO ADJUSTED EBITDA
(UNAUDITED)
 
(In thousands)
  Three Months Ended
December 31,
  Twelve Months Ended
December 31,
  2023     2022     2023     2022  
               
GAAP net income 19,834     52,946     67,741     180,550  
Non-GAAP adjustments:              
Depreciation and intangible asset amortization expense 30,522     29,493     122,528     118,238  
Other (income), net (1,897 )   (2,938 )   (2,853 )   (7,833 )
Interest expense, net 9,202     7,583     34,175     37,677  
Income tax expense (benefit) 9,024     11,262     13,328     33,344  
Structural optimization charges 7,998     (1,533 )   23,020     23,072  
EU Medical Device Regulation charges 12,387     12,177     46,559     45,147  
Boston Recall 6,346         40,034      
Acquisition, divestiture and integration-related charges 7,117     704     25,173     (18,849 )
Total of non-GAAP adjustments 80,700     56,747     301,964     230,796  
Adjusted EBITDA 100,534     109,693     369,705     411,346  
 
INTEGRA LIFESCIENCES HOLDINGS CORPORATION
RECONCILIATION OF NON-GAAP ADJUSTMENTS - GAAP NET INCOME FROM CONTINUING OPERATIONS TO MEASURES OF ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE
(UNAUDITED)
 
(In thousands, except per share amounts)
  Three Months Ended
December 31,
  Twelve Months Ended
December 31,
    2023       2022       2023       2022  
               
GAAP net income   19,834       52,946       67,741       180,550  
Non-GAAP adjustments:              
Structural optimization charges   7,998       (1,533 )     23,020       23,072  
Acquisition, divestiture and integration-related charges   7,117       704       25,173       (18,849 )
EU Medical Device Regulation charges   12,387       12,177       46,559       45,147  
Boston Recall   6,346             40,034        
Intangible asset amortization expense   20,687       19,632       82,823       78,295  
Estimated income tax impact from adjustments and other items   (5,272 )     (5,091 )     (37,573 )     (27,349 )
Total of non-GAAP adjustments   49,264       25,889       180,036       100,316  
Adjusted net income $ 69,098     $ 78,835     $ 247,777     $ 280,866  
               
Adjusted diluted net income per share $ 0.89     $ 0.94     $ 3.10     $ 3.36  
Weighted average common shares outstanding for diluted net income per share   77,959       83,568       80,337       83,516  
 
INTEGRA LIFESCIENCES HOLDINGS CORPORATION
CONDENSED BALANCE SHEET DATA
(UNAUDITED)
 
(In thousands)
    December 31,   December 31,
      2023       2022  
         
Cash and cash equivalents   $ 276,402     $ 456,661  
Accounts receivable, net     259,327       263,465  
Inventory, net     389,608       324,583  
         
Current and long-term borrowing under senior credit facility     840,094       771,274  
Borrowings under securitization facility     89,200       104,700  
Long-term convertible securities     570,255       567,341  
         
Stockholders' equity     1,587,884       1,804,403  
 
INTEGRA LIFESCIENCES HOLDINGS CORPORATION
CONDENSED STATEMENT OF CASH FLOWS
(UNAUDITED)
 
  Twelve Months Ending December 31,
    2023       2022  
Net cash provided by operating activities $ 139,955     $ 264,469  
Net cash used in investing activities   (94,178 )     (58,580 )
Net cash used in by financing activities   (229,925 )     (251,953 )
Effect of exchange rate changes on cash and cash equivalents   3,889       (10,723 )
     
Net increase (decrease) in cash and cash equivalents   (180,259 )     (56,787 )
 
RECONCILIATION OF NON-GAAP ADJUSTMENTS - GAAP OPERATING CASH FLOW TO
MEASURES OF ADJUSTED FREE CASH FLOW AND ADJUSTED FREE CASH FLOW CONVERSION
(UNAUDITED)
 
(In thousands)
  Three Months Ended December 31,
    2023     2022  
GAAP Net cash provided by operating activities $ 58,746   $ 85,333  
     
Purchases of property and equipment   (24,563 )   (14,455 )
Adj. Free Cash Flow $ 34,183   $ 70,878  
     
Adjusted net income (1) $ 69,098     78,835  
Adjusted Free Cash Flow Conversion   49.5 %   89.9 %
     
     
  Twelve Months Ending December 31,
    2023     2022  
GAAP Net cash provided by operating activities $ 139,955   $ 264,469  
     
Purchases of property and equipment   (66,865 )   (42,343 )
Adj. Free Cash Flow $ 73,090   $ 222,127  
     
Adjusted net income (1) $ 247,777     280,867  
Adjusted Free Cash Flow Conversion   29.5 %   79.1 %
     

(1) Adjusted net income for quarters and twelve months ended December 31, 2022 and 2023 are reconciled above. Adjusted net income for remaining quarters in the trailing twelve months calculation have been previously reconciled and are publicly available in the Quarterly Earnings Call Presentations on our website at investor.integralife.com.

The Company calculates adjusted free cash flow conversion by dividing its free cash flow by adjusted net income. The Company believes this measure is a useful metric in evaluating the significance of the cash special charges in its adjusted earnings measures.

RECONCILIATION OF NON-GAAP ADJUSTMENTS - NET DEBT CALCULATION
(UNAUDITED)
     
(In thousands)    
    December 31,
2023
December 31,
2022
Short-term borrowings under senior credit facility   $ 14,531   $ 38,125  
Long-term borrowings under senior credit facility     825,563     733,149  
Borrowings under securitization facility     89,200     104,700  
Long-term convertible securities     570,255     567,341  
Deferred financing costs netted in the above     9,651     11,385  
Short-term investments     (32,694 )    
Cash & Cash Equivalents     (276,402 )   (456,661 )
Net Debt   $ 1,200,104   $ 998,039  


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