Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2020 | Feb. 15, 2021 | Jun. 30, 2020 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2020 | ||
Entity Registrant Name | GLOBUS MEDICAL, INC. | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 99,796,911 | ||
Entity Shell Company | false | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Title of 12(b) Security | Class A Common Stock, par value $.001 per share | ||
Trading Symbol | GMED | ||
Security Exchange Name | NYSE | ||
Entity File Number | 001-35621 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 04-3744954 | ||
Entity Address, Address Line One | 2560 General Armistead Avenue | ||
Entity Address, City or Town | Audubon | ||
Entity Address, State or Province | PA | ||
Entity Address, Postal Zip Code | 19403 | ||
City Area Code | 610 | ||
Local Phone Number | 930-1800 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001237831 | ||
ICFR Auditor Attestation Flag | true | ||
Current Fiscal Year End Date | --12-31 | ||
EntityPublicFloat | $ 3.5 | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Documents Incorporated By Reference [Text Block] | DOCUMENTS INCORPORATED BY REFERENCE Portions of our Proxy Statement for our 2020 Annual Meeting of Stockholders, to be filed within 120 days of December 31, 2020, are incorporated by reference in Part III, Items 10, 11, 12, 13 and 14 herein of this Annual Report. Such Proxy Statement, except for the parts therein which have been specifically incorporated by reference, shall not be deemed “filed” for the purposes of this Annual Report on Form 10-K. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash, cash equivalents, and restricted cash | $ 239,397 | $ 195,724 |
Short-term marketable securities | 187,344 | 115,763 |
Accounts receivable, net of allowances of $4,408 and $5,599, respectively | 141,676 | 154,326 |
Inventories | 229,153 | 196,314 |
Prepaid expenses and other current assets | 17,771 | 17,243 |
Income taxes receivable | 6,424 | 8,098 |
Total current assets | 821,765 | 687,468 |
Property and equipment, net of accumulated depreciation of $276,451 and $243,732, respectively | 216,879 | 199,841 |
Long-term marketable securities | 358,522 | 409,514 |
Intangible assets, net | 86,949 | 78,812 |
Goodwill | 156,716 | 128,775 |
Other assets | 32,039 | 21,741 |
Deferred income taxes | 6,615 | 5,926 |
Total assets | 1,679,485 | 1,532,077 |
Current liabilities: | ||
Accounts payable | 18,205 | 24,614 |
Accrued expenses | 78,334 | 63,283 |
Income taxes payable | 1,101 | 1,057 |
Business acquisition liabilities | 5,777 | 6,727 |
Deferred revenue | 8,125 | 5,402 |
Payable to broker | 9,250 | 10,320 |
Total current liabilities | 120,792 | 111,403 |
Business acquisition liabilities, net of current portion | 31,493 | 2,822 |
Deferred income taxes | 6,202 | 6,023 |
Other liabilities | 14,701 | 9,377 |
Total liabilities | 173,188 | 129,625 |
Commitments and contingencies (Note 17) | ||
Equity: | ||
Additional paid-in capital | 457,161 | 357,320 |
Accumulated other comprehensive loss | 3,955 | (2,898) |
Retained earnings | 1,045,082 | 1,047,931 |
Total equity | 1,506,297 | 1,402,452 |
Total liabilities and equity | 1,679,485 | 1,532,077 |
Common Class A [Member] | ||
Equity: | ||
Common stock | 77 | 77 |
Common Class B [Member] | ||
Equity: | ||
Common stock | $ 22 | $ 22 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Accounts receivable, allowances | $ 4,408 | $ 5,599 |
Property and equipment | ||
Accumulated depreciation | $ 276,451 | $ 243,732 |
Equity: | ||
Common stock, shares authorized | 775,000,000 | |
Common Class A [Member] | ||
Equity: | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 77,284,007 | 77,394,983 |
Common stock, shares outstanding | 77,284,007 | 77,394,983 |
Common Class B [Member] | ||
Equity: | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 275,000,000 | 275,000,000 |
Common stock, shares issued | 22,430,097 | 22,430,097 |
Common stock, shares outstanding | 22,430,097 | 22,430,097 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Consolidated Statements of Operations and Comprehensive Income [Abstract] | |||
Net sales | $ 789,042 | $ 785,368 | $ 712,969 |
Cost of goods sold | 217,463 | 179,975 | 159,410 |
Gross profit | 571,579 | 605,393 | 553,559 |
Operating expenses: | |||
Research and development | 84,519 | 60,073 | 55,496 |
Selling, general and administrative | 354,757 | 354,757 | 311,591 |
Provision for litigation | 9 | 2,190 | 5,878 |
Amortization of intangibles | 16,831 | 13,809 | 9,588 |
Acquisition related costs | 4,030 | 2,575 | 1,681 |
Total operating expenses | 460,146 | 433,404 | 384,234 |
Operating income/(loss) | 111,433 | 171,989 | 169,325 |
Other income/(expense), net | |||
Interest income/(expense), net | 13,952 | 17,406 | 13,278 |
Foreign currency transaction gain/(loss) | (279) | 75 | 360 |
Other income/(expense) | 793 | 476 | 5,642 |
Total other income/(expense), net | 14,466 | 17,957 | 19,280 |
Income/(loss) before income taxes | 125,899 | 189,946 | 188,605 |
Income tax provision | 23,614 | 34,736 | 32,131 |
Net income/(loss) | 102,285 | 155,210 | 156,474 |
Other comprehensive income/(loss): | |||
Unrealized gain/(loss) on marketable securities, net of tax | 1,402 | 3,767 | 145 |
Foreign currency translation gain/(loss) | 5,451 | 507 | (410) |
Total other comprehensive income/(loss) | 6,853 | 4,274 | (265) |
Comprehensive income/(loss) | $ 109,138 | $ 159,484 | $ 156,209 |
Earnings per share: | |||
Basic | $ 1.04 | $ 1.57 | $ 1.60 |
Diluted | $ 1.01 | $ 1.52 | $ 1.54 |
Weighted average shares outstanding: | |||
Basic | 98,580 | 99,150 | 97,884 |
Diluted | 100,971 | 101,998 | 101,316 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) shares in Thousands, $ in Thousands | Cumulative Effect, Period of Adoption, Adjustment [Member]Retained Earnings [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | Common Stock [Member]Common Class A [Member] | Common Stock [Member]Common Class B [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income/(Loss) [Member] | Retained Earnings [Member] | Total |
Shares, Outstanding, Beginning Balance at Dec. 31, 2017 | 72,780 | 23,878 | ||||||
Total equity, beginning of period at Dec. 31, 2017 | $ 73 | $ 24 | $ 238,341 | $ (6,907) | $ 736,247 | $ 967,778 | ||
Stock-based compensation | 6,110 | 6,110 | ||||||
Exercise of stock options (shares) | 506 | |||||||
Exercise of stock options | 9,307 | 9,307 | ||||||
Comprehensive income/(loss) | 4,135 | 39,538 | 43,673 | |||||
Total equity, end of period at Mar. 31, 2018 | $ 73 | $ 24 | 253,758 | (2,772) | 775,785 | 1,026,868 | ||
Shares, Outstanding, Ending Balance at Mar. 31, 2018 | 73,286 | 23,878 | ||||||
Shares, Outstanding, Beginning Balance at Dec. 31, 2017 | 72,780 | 23,878 | ||||||
Total equity, beginning of period at Dec. 31, 2017 | $ 73 | $ 24 | 238,341 | (6,907) | 736,247 | 967,778 | ||
Comprehensive income/(loss) | 156,209 | |||||||
Total equity, end of period at Dec. 31, 2018 | $ 76 | $ 22 | 299,869 | (7,172) | 892,721 | 1,185,516 | ||
Shares, Outstanding, Ending Balance at Dec. 31, 2018 | 76,144 | 22,431 | ||||||
Shares, Outstanding, Beginning Balance at Mar. 31, 2018 | 73,286 | 23,878 | ||||||
Total equity, beginning of period at Mar. 31, 2018 | $ 73 | $ 24 | 253,758 | (2,772) | 775,785 | 1,026,868 | ||
Stock-based compensation | 5,551 | 5,551 | ||||||
Exercise of stock options (shares) | 1,084 | |||||||
Exercise of stock options | $ 1 | 23,823 | 1 | 23,825 | ||||
Comprehensive income/(loss) | (4,035) | 44,977 | 40,942 | |||||
Total equity, end of period at Jun. 30, 2018 | $ 74 | $ 24 | 283,132 | (6,807) | 820,763 | 1,097,186 | ||
Shares, Outstanding, Ending Balance at Jun. 30, 2018 | 74,370 | 23,878 | ||||||
Conversion to Class A | 1 | (1) | ||||||
Conversion to Class A (shares) | $ 1,447 | $ (1,447) | ||||||
Stock-based compensation | 5,631 | 5,631 | ||||||
Exercise of stock options (shares) | 203 | |||||||
Exercise of stock options | $ 1 | 3,112 | 3,113 | |||||
Comprehensive income/(loss) | (21) | 35,208 | 35,187 | |||||
Total equity, end of period at Sep. 30, 2018 | $ 76 | $ 23 | 291,875 | (6,828) | 855,971 | 1,141,117 | ||
Shares, Outstanding, Ending Balance at Sep. 30, 2018 | 76,020 | 22,431 | ||||||
Stock-based compensation | 4,927 | 4,927 | ||||||
Exercise of stock options (shares) | 124 | |||||||
Exercise of stock options | $ (1) | 3,067 | 3,066 | |||||
Comprehensive income/(loss) | (344) | 36,750 | 36,406 | |||||
Total equity, end of period at Dec. 31, 2018 | $ 76 | $ 22 | 299,869 | (7,172) | 892,721 | 1,185,516 | ||
Shares, Outstanding, Ending Balance at Dec. 31, 2018 | 76,144 | 22,431 | ||||||
Stock-based compensation | 6,541 | 6,541 | ||||||
Exercise of stock options (shares) | 407 | |||||||
Exercise of stock options | $ 1 | 10,255 | (1) | 10,255 | ||||
Comprehensive income/(loss) | 1,692 | 33,210 | 34,902 | |||||
Total equity, end of period at Mar. 31, 2019 | $ 77 | $ 22 | 316,665 | (5,480) | 925,930 | 1,237,214 | ||
Shares, Outstanding, Ending Balance at Mar. 31, 2019 | 76,551 | 22,431 | ||||||
Shares, Outstanding, Beginning Balance at Dec. 31, 2018 | 76,144 | 22,431 | ||||||
Total equity, beginning of period at Dec. 31, 2018 | $ 76 | $ 22 | 299,869 | (7,172) | 892,721 | 1,185,516 | ||
Comprehensive income/(loss) | 159,484 | |||||||
Total equity, end of period at Dec. 31, 2019 | $ (468) | $ (468) | $ 77 | $ 22 | 357,320 | (2,898) | 1,047,931 | 1,402,452 |
Shares, Outstanding, Ending Balance at Dec. 31, 2019 | 77,394 | 22,431 | ||||||
Shares, Outstanding, Beginning Balance at Mar. 31, 2019 | 76,551 | 22,431 | ||||||
Total equity, beginning of period at Mar. 31, 2019 | $ 77 | $ 22 | 316,665 | (5,480) | 925,930 | 1,237,214 | ||
Stock-based compensation | 6,381 | 6,381 | ||||||
Exercise of stock options (shares) | 96 | |||||||
Exercise of stock options | 2,015 | 1 | 2,016 | |||||
Comprehensive income/(loss) | 3,752 | 38,163 | 41,915 | |||||
Total equity, end of period at Jun. 30, 2019 | $ 77 | $ 22 | 325,061 | (1,728) | 964,094 | 1,287,526 | ||
Shares, Outstanding, Ending Balance at Jun. 30, 2019 | 76,647 | 22,431 | ||||||
Stock-based compensation | 6,978 | 6,978 | ||||||
Exercise of stock options (shares) | 326 | |||||||
Exercise of stock options | 7,081 | 1 | 7,082 | |||||
Comprehensive income/(loss) | (1,098) | 38,307 | 37,209 | |||||
Total equity, end of period at Sep. 30, 2019 | $ 77 | $ 22 | 339,120 | (2,826) | 1,002,402 | 1,338,795 | ||
Shares, Outstanding, Ending Balance at Sep. 30, 2019 | 76,973 | 22,431 | ||||||
Stock-based compensation | 6,516 | 6,516 | ||||||
Exercise of stock options (shares) | 421 | |||||||
Exercise of stock options | 11,684 | 11,684 | ||||||
Comprehensive income/(loss) | (72) | 45,529 | 45,457 | |||||
Total equity, end of period at Dec. 31, 2019 | (468) | (468) | $ 77 | $ 22 | 357,320 | (2,898) | 1,047,931 | 1,402,452 |
Shares, Outstanding, Ending Balance at Dec. 31, 2019 | 77,394 | 22,431 | ||||||
Stock-based compensation | 6,902 | 6,902 | ||||||
Exercise of stock options (shares) | 190 | |||||||
Exercise of stock options | $ 1 | 5,762 | 5,763 | |||||
Comprehensive income/(loss) | (3,368) | 25,949 | 22,581 | |||||
Repurchase and retirement of common stock (shares) | (1,920) | |||||||
Repurchase and retirement of common stock | $ (2) | (73,862) | (73,864) | |||||
Total equity, end of period at Mar. 31, 2020 | $ 76 | $ 22 | 369,984 | (6,266) | 999,550 | 1,363,366 | ||
Shares, Outstanding, Ending Balance at Mar. 31, 2020 | 75,664 | 22,431 | ||||||
Shares, Outstanding, Beginning Balance at Dec. 31, 2019 | 77,394 | 22,431 | ||||||
Total equity, beginning of period at Dec. 31, 2019 | $ (468) | $ (468) | $ 77 | $ 22 | 357,320 | (2,898) | 1,047,931 | $ 1,402,452 |
Exercise of stock options (shares) | 2,581 | |||||||
Comprehensive income/(loss) | $ 109,138 | |||||||
Total equity, end of period at Dec. 31, 2020 | $ 77 | $ 22 | 457,161 | 3,955 | 1,045,082 | 1,506,297 | ||
Shares, Outstanding, Ending Balance at Dec. 31, 2020 | 77,284 | 22,430 | ||||||
Shares, Outstanding, Beginning Balance at Mar. 31, 2020 | 75,664 | 22,431 | ||||||
Total equity, beginning of period at Mar. 31, 2020 | $ 76 | $ 22 | 369,984 | (6,266) | 999,550 | 1,363,366 | ||
Stock-based compensation | 7,426 | 7,426 | ||||||
Exercise of stock options (shares) | 434 | |||||||
Exercise of stock options (shares) | (1) | |||||||
Exercise of stock options | 10,201 | 10,201 | ||||||
Comprehensive income/(loss) | 7,564 | (20,837) | (13,273) | |||||
Repurchase and retirement of common stock (shares) | (771) | |||||||
Repurchase and retirement of common stock | $ (1) | (30,804) | (30,805) | |||||
Total equity, end of period at Jun. 30, 2020 | $ 75 | $ 22 | 387,611 | 1,298 | 947,909 | 1,336,915 | ||
Shares, Outstanding, Ending Balance at Jun. 30, 2020 | 75,327 | 22,430 | ||||||
Stock-based compensation | 7,007 | 7,007 | ||||||
Exercise of stock options (shares) | 915 | |||||||
Exercise of stock options | $ 1 | 28,156 | 28,157 | |||||
Comprehensive income/(loss) | 909 | 44,216 | 45,125 | |||||
Total equity, end of period at Sep. 30, 2020 | $ 76 | $ 22 | 422,774 | 2,207 | 992,125 | 1,417,204 | ||
Shares, Outstanding, Ending Balance at Sep. 30, 2020 | 76,242 | 22,430 | ||||||
Stock-based compensation | 5,995 | 5,995 | ||||||
Grants of restricted stock units | 191 | 191 | ||||||
Exercise of stock options (shares) | 1,042 | |||||||
Exercise of stock options | $ 1 | 28,201 | 28,202 | |||||
Comprehensive income/(loss) | 1,748 | 52,957 | 54,705 | |||||
Total equity, end of period at Dec. 31, 2020 | $ 77 | $ 22 | $ 457,161 | $ 3,955 | $ 1,045,082 | $ 1,506,297 | ||
Shares, Outstanding, Ending Balance at Dec. 31, 2020 | 77,284 | 22,430 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||
Net income | $ 102,285 | $ 155,210 | $ 156,474 |
Adjustments to reconcile net income to net cash provided by operating activities | |||
Acquired in-process research and development | 24,418 | ||
Depreciation and amortization | 62,874 | 52,734 | 41,630 |
Amortization of premium (discount) on marketable securities | 587 | (1,089) | 1,677 |
Write-down for excess and obsolete inventories, net | 17,741 | 2,498 | 10,475 |
Stock-based compensation expense | 27,073 | 26,085 | 21,899 |
Allowance for doubtful accounts | 2,960 | 3,026 | 957 |
Change in fair value of business acquisition liabilities | 2,674 | 1,787 | 985 |
Change in deferred income taxes | (4,338) | 4,302 | 971 |
(Gain)/loss on disposal of assets, net | 809 | 866 | (3,557) |
Payment of business acquisition related liabilities | (700) | ||
(Increase)/decrease in: | |||
Accounts receivable | 10,696 | (18,306) | (21,789) |
Inventories | (50,111) | (50,018) | (31,382) |
Prepaid expenses and other assets | (11,088) | (12,263) | (7,496) |
Increase/(decrease) in: | |||
Accounts payable | (6,352) | 773 | (3,008) |
Accrued expenses and other liabilities | 17,608 | 7,043 | 14,728 |
Income taxes payable/receivable | 1,657 | (673) | (921) |
Net cash provided by operating activities | 198,793 | 171,975 | 181,643 |
Cash flows from investing activities: | |||
Purchases of marketable securities | (223,540) | (346,526) | (537,942) |
Maturities of marketable securities | 134,462 | 247,008 | 278,049 |
Sales of marketable securities | 68,897 | 53,786 | 106,388 |
Purchases of property and equipment | (63,658) | (70,750) | (59,697) |
Collections/(issuance) of note receivable | 30,000 | ||
Proceeds from sale of assets | 5,000 | ||
Acquisition of businesses, net of cash acquired and purchases of intangible and other assets | (33,483) | (23,799) | (14,825) |
Net cash used in investing activities | (117,322) | (140,281) | (193,027) |
Cash flows from financing activities: | |||
Payment of business acquisition related liabilities | (6,316) | (6,597) | (6,739) |
Proceeds from exercise of stock options | 72,322 | 31,036 | 39,309 |
Repurchase of common stock | (104,669) | ||
Net cash used in/provided by financing activities | (38,663) | 24,439 | 32,570 |
Effect of foreign exchange rate on cash | 865 | (156) | (256) |
Net increase in cash, cash equivalents, and restricted cash | 43,673 | 55,977 | 20,930 |
Cash, cash equivalents, and restricted cash at beginning of period | 195,724 | 139,747 | 118,817 |
Cash, cash equivalents, and restricted cash at end of period | 239,397 | 195,724 | 139,747 |
Supplemental disclosures of cash flow information: | |||
Income taxes paid | 25,437 | 34,139 | 30,552 |
Purchases of property and equipment included in accounts payable and accrued expenses | $ 4,210 | $ 4,226 | $ 10,084 |
BACKGROUND
BACKGROUND | 12 Months Ended |
Dec. 31, 2020 | |
BACKGROUND [Abstract] | |
Background | NOTE 1. BACKGROUND (a) The Company Globus Medical, Inc., together with its subsidiaries, is a medical device company that develops and commercializes healthcare solutions in a mission to improve the quality of life of patients with musculoskeletal disorders. We are primarily focused on implants that promote healing in patients with musculoskeletal disorders, including the use of a robotic guidance and navigation system and products to treat patients who have experienced orthopedic traumas. We are an engineering-driven company with a history of rapidly developing and commercializing advanced products and procedures to assist surgeons in effectively treating their patients and to address new treatment options. With 220 products launched, we offer a comprehensive portfolio of innovative and differentiated technologies that address a variety of musculoskeletal pathologies, anatomies, and surgical approaches. We are headquartered in Audubon, Pennsylvania, and market and sell our products through our exclusive sales force in the United States, as well as within North, Central & South America, Europe, Asia, Africa and Australia. The sales force consists of direct sales representatives and distributor sales representatives employed by exclusive independent distributors. The terms the “Company,” “Globus,” “we,” “us” and “our” refer to Globus Medical, Inc. and, where applicable, our consolidated subsidiaries. (b) COVID-19 Pandemic Impact On March 11, 2020, the World Health Organization declared the novel strain of coronavirus (“COVID-19”) a global pandemic and recommended containment and mitigation measures worldwide. The pandemic has significantly impacted the economic conditions in the U.S. and globally as federal, state and local governments react to the public health crisis, creating significant uncertainties in the economy. While emergency and time-sensitive surgical procedures continue, as of the date of this filing, the Company has been impacted by temporary postponement of elective surgeries in hospitals and surgical facilities worldwide. Although the Company cannot reasonably estimate the length or severity of the impact that the pandemic will have on its financial results, the Company has experienced, and may continue to experience, a material adverse impact on its sales, results of operations, and cash flows in fiscal 2021. In response to these developments, the Company will continue to monitor liquidity and cash flow. The Company has the ability to borrow from a credit facility signed in August 2020, if needed, although we do not expect to do so due to our cash, cash equivalents and short-term marketable securities balances. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”). (b) Principles of Consolidation The accompanying consolidated financial statements include the accounts of Globus and its wholly owned subsidiaries. All intercompany balances and transactions are eliminated in consolidation. (c) Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. We base our estimates, in part, on historical experience that management believes to be reasonable under the circumstances. Actual results could differ from those estimates. Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Significant areas that require estimates include revenue recognition, intangible assets, business acquisition liabilities, allowance for doubtful accounts, stock-based compensation, reserves for excess and obsolete inventory, useful lives of assets, the outcome of litigation, recoverability of intangible assets and income taxes. We are subject to risks and uncertainties due to changes in the healthcare environment, regulatory oversight, competition, and legislation that may cause actual results to differ from estimated results. (d) Revenue Recognition Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. Sales and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. For purposes of disclosure, we disaggregate our revenue into two categories, Musculoskeletal Solutions and Enabling Technologies. Our Musculoskeletal Solutions products consist primarily of the implantable devices, disposables, and unique instruments used in an expansive range of spine, orthopedic trauma, hip, knee and extremity procedures. The majority of our Musculoskeletal Solutions contracts have a single performance obligation and revenue is recognized at a point in time. Our Enabling Technologies products are advanced hardware and software systems, and related technologies, that are designed to enhance a surgeon’s capabilities and streamline surgical procedures by making them less invasive, more accurate, and more reproducible to improve patient care. The majority of our Enabling Technologies product contracts contain multiple performance obligations, including maintenance and support, and revenue is recognized as we fulfill each performance obligation. When contracts have multiple performance obligations, we allocate the contract’s transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. Our policy is to classify shipping and handling costs billed to customers as sales and the related expenses as cost of goods sold. Nature of Products and Services A significant portion of our Musculoskeletal Solutions product revenue is generated from consigned inventory maintained at hospitals or with sales representatives. Revenue from the sale of consigned musculoskeletal products is recognized when we transfer control, which occurs at the time the product is used or implanted. For all other Musculoskeletal Solutions product transactions, we recognize revenue when we transfer title to the goods, provided there are no remaining performance obligations that can affect the customer’s final acceptance of the sale. Revenue from the sale of Enabling Technologies products is generally recognized when control transfers to the customer which occurs at the time the product is shipped or delivered. Depending on the terms of the arrangement, we may also defer the recognition of a portion of the consideration as we satisfy future performance obligations related to the provision of maintenance and support. We use an observable price to determine the stand-alone selling price for each separate performance obligation. Contract Balances Timing of revenue recognition may differ from the timing of invoicing to customers. We record a receivable when revenue is recognized prior to invoicing, or deferred revenue when revenue is recognized subsequent to invoicing. Deferred revenue is comprised mainly of unearned revenue related to the sales of certain Enabling Technologies products, which includes maintenance and support services. Deferred revenue is generally invoiced annually at the beginning of each contract period and recognized ratably over the coverage period. For the years ended December 31, 2020, 2019, and 2018, there was an immaterial amount of revenue recognized from previously deferred revenue. (e) Concentrations of Credit Risk Financial instruments, which potentially subject us to concentrations of credit risk, are primarily marketable securities and accounts receivable. Concentrations of credit risk with respect to accounts receivable are limited due to the large number of entities comprising our customer base. We perform ongoing credit evaluations of our customers and generally do not require collateral. There was no customer that accounted for 10% or more of sales for the years ended December 31, 2020, 2019, and 2018, respectively. (f) Cash, Cash Equivalents, and Restricted Cash The Company considers all short-term, highly liquid investments with original maturities of 90 days or less at acquisition date to be cash equivalents. Cash equivalents, which consist of money market accounts, commercial paper and corporate debt securities are stated at fair value. (g) Marketable Securities Our marketable securities include municipal bonds, corporate debt securities, commercial paper, asset-backed securities, and securities of government, federal agency, and other sovereign obligations, and are classified as available-for-sale as of December 31, 2020 and 2019. Short-term and long-term marketable securities are recorded at fair value on our consolidated balance sheets. Any change in fair value for available-for-sale securities, that do not result in recognition or reversal of an allowance for credit loss or write down, is recorded, net of taxes, as a component of accumulated other comprehensive income or loss on our consolidated balance sheets. Premiums and discounts are recognized over the life of the related security as an adjustment to yield using the straight-line method. Realized gains or losses from the sale of marketable securities are determined on a specific identification basis. Realized gains and losses, interest income and the amortization/accretion of premiums/discounts are included as a component of other income/(expense), net, on our consolidated statements of operations and comprehensive income. Interest receivable is recorded as a component of prepaid expenses and other current assets on our consolidated balance sheets. We invest in securities that meet or exceed standards as defined in our investment policy. Our policy also limits the amount of credit exposure to any one issue, issuer or type of security. We review our securities for other-than-temporary impairment at each reporting period. If an unrealized loss for any security is expected, the loss will be recognized on an allowance basis, consistent with ASC 326-30, in our consolidated statements of operations and comprehensive income in the period the determination is made. (h) Fair Value Measurements Assets and Liabilities That Are Measured at Fair Value on a Recurring Basis Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or the liability in an orderly transaction between market participants on the measurement date. Additionally, a fair value hierarchy was established that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable inputs. The level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Our assets and liabilities measured at fair value on a recurring basis are classified and disclosed in one of the following three categories: Level 1—quoted prices (unadjusted) in active markets for identical assets and liabilities; Level 2—observable inputs other than quoted prices in active markets for identical assets and liabilities; and Level 3—unobservable inputs in which there is little or no market data available, which require the reporting entity to use significant unobservable inputs or valuation techniques. Assets and Liabilities That Are Measured at Fair Value on a Nonrecurring Basis The purchase price of business acquisitions is primarily allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values on the acquisition date, with the excess recorded as goodwill. We utilize Level 3 inputs in the determination of the initial fair value. Contingent consideration represents contingent milestone, performance and revenue-sharing payment obligations related to acquisitions and is measured at fair value, based on significant inputs that are not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The valuation of contingent consideration uses assumptions we believe would be made by a market participant. We assess these assumptions on an ongoing basis as additional data impacting the assumptions is obtained. The fair value of contingent consideration is recorded in business acquisition liabilities on our consolidated balance sheets, and changes in the fair value of contingent consideration is recognized in acquisition related costs in the consolidated statements of operations and comprehensive income. The fair value of contingent restricted stock unit (“RSU”) grants are recorded as additional paid-in capital in the consolidated balance sheet on the day of the grant due to the remote likelihood of forfeiture. (i) Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out basis. The majority of our inventory is finished goods and we utilize both in-house manufacturing and third-party suppliers to produce our products. We periodically evaluate the carrying value of our inventories in relation to estimated forecasts of product demand, which takes into consideration the life cycle of product releases. When quantities on hand exceed estimated sales forecasts, we record a write-down for such excess inventories. Once inventory has been written down, it creates a new cost basis for inventory that is not subsequently written up. (j) Property and Equipment Property and equipment is recorded at cost less accumulated depreciation. Additions or improvements are capitalized, while repairs and maintenance are expensed as incurred. Depreciation is recognized using the straight-line method over the related useful lives of the assets. When assets are sold or otherwise disposed of, the related property, equipment, and accumulated depreciation amounts are relieved from the accounts, and any gain or loss is recorded in the consolidated statements of operations and comprehensive income. (k) Goodwill and Intangible Assets Goodwill represents the excess of purchase price over the fair values of the identifiable assets acquired less the liabilities assumed in the acquisition of a business. Goodwill is tested for impairment at least annually. Goodwill is tested for impairment at the reporting unit level by comparing the reporting unit’s carrying amount to the fair value of the reporting unit. Fair values are estimated using an income and discounted cash flow approach. We perform our annual impairment test of goodwill in the fourth quarter of each year. We consider qualitative indicators of the fair value of a reporting unit when it is unlikely that a reporting unit has impaired goodwill. During the years ended December 31, 2020, 2019, and 2018, we did no t record any impairment charges related to goodwill. Intangible assets consist of purchased in-process research and development (“IPR&D”), developed technology, supplier network, patents, customer relationships, re-acquired rights, and non-compete agreements. Intangible assets with finite useful lives are amortized over the period of estimated benefit using the straight-line method and estimated useful lives ranging from one to sixteen years. Intangible assets are tested for impairment annually or whenever events or circumstances indicate that a carrying amount of an asset (asset group) may not be recoverable. If an impairment is indicated, we measure the amount of the impairment loss as the amount by which the carrying amount exceeds the fair value of the asset. Fair value is generally determined using a discounted future cash flow analysis. There were no impairments of finite-lived intangible assets during the years ended December 31, 2020, 2019, or 2018. IPR&D has an indefinite life and is not amortized until completion of the project at which time the IPR&D becomes an amortizable asset. If the related project is not completed in a timely manner, we may have an impairment related to the IPR&D, calculated as the excess of the asset’s carrying value over its fair value. There were no impairments of IPR&D during the years ended December 31, 2020, 2019, or 2018. (l) Impairment of Long-Lived Assets We periodically evaluate the recoverability of the carrying amount of long-lived assets, which include property and equipment, as well as whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be fully recoverable. An impairment is assessed when the undiscounted future cash flows from the use and eventual disposition of an asset group are less than its carrying value. If an impairment is indicated, we measure the amount of the impairment loss as the amount by which the carrying amount exceeds the fair value of the asset group. Our fair value methodology is based on quoted market prices, if available. If quoted market prices are not available, an estimate of fair value is made based on prices of similar assets or other valuation techniques including present value techniques. During the years ended December 31, 2020, 2019, and 2018, we did no t record any impairment charges related to long-lived assets. (m) Cost of Goods Sold Cost of goods sold consists primarily of costs from our manufacturing operations, costs of products purchased from third-party suppliers, reserves for excess and obsolete inventory, depreciation of surgical instruments and cases, royalties, shipping, inspection and related costs incurred in making our products available for sale or use. (n) Research and Development Research and development costs are expensed as incurred. Research and development costs include salaries, employee benefits, supplies, consulting services, clinical services and clinical trial costs, and facilities costs. Costs incurred in obtaining technology licenses and patents are charged immediately to research and development expense if the technology licensed has not reached technological feasibility and has no alternative future use. (o) Stock -Based Compensation The cost of employee and non-employee director awards is measured at the grant date fair value of the award and is recognized as expense over the requisite service period, which is generally the vesting period of the equity award. Compensation expense for awards includes the impact of forfeiture in the period when they occur. We estimate the fair value of stock options utilizing the Black-Scholes option-pricing model. Inputs to the Black-Scholes model include our stock price, expected volatility, expected term, risk-free interest rate and expected dividends. Expected volatility is based on the historical volatility of the Company’s common stock over the most recent period commensurate with the estimated expected term of the Company’s stock options offering period which is derived from historical experience. The risk-free interest rate assumption is based on observed interest rates of U.S. Treasury securities appropriate for the expected terms of the stock options. The dividend yield assumption is based on the history and expectation of no dividend payouts. The fair value of restricted stock units is estimated on the day of grant based on the closing price of the Company’s common stock. (p) Advertising Expense We expense advertising costs as they are incurred. Advertising expense was $ 0.6 million, $ 1.1 million, and $ 1.9 million for the years ended December 31, 2020, 2019, and 2018, respectively. (q) Provision for Litigation We are involved in a number of proceedings, legal actions, and claims. Such matters are subject to many uncertainties, and the outcomes of these matters are not within our control and may not be known for prolonged periods of time. In some actions, the claimants seek damages, as well as other relief, including injunctions prohibiting us from engaging in certain activities, which, if granted, could require significant expenditures and/or result in lost revenues. We record a liability in the consolidated financial statements for these actions when a loss is considered probable and the amount can be reasonably estimated. If the reasonable estimate of a probable loss is a range, and no amount within the range is a better estimate than any other, the minimum amount of the range is accrued. If a loss is reasonably possible but not known or probable, and can be reasonably estimated, the estimated loss or range of loss is disclosed. In most cases, significant judgment is required to estimate the amount and timing of a loss to be recorded. We expense legal costs related to loss contingencies as incurred. (r) Acquisition Related Costs Acquisition related costs represents the change in fair value of business acquisition related contingent consideration; costs related to integrating recently acquired businesses including but not limited to costs to exit or convert contractual obligations, severance, and information system conversion; and specific costs related to the consummation of the acquisition process such as banker fees, legal fees, and other acquisition related professional fees. (s ) Foreign Currency Translation The functional currency of our foreign subsidiaries is generally their local currency. Assets and liabilities of the foreign subsidiaries are translated at the period end currency exchange rate and revenues and expenses are translated at an average currency exchange rate for the period. The resulting foreign currency translation gains and losses are included as a component of accumulated other comprehensive income. Gains and losses arising from intercompany foreign transactions are included in other income, net on the consolidated statements of operations and comprehensive income. (t) Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year in which such items are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance is established to offset any deferred tax assets if, based upon available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. Significant judgment is required in determining income tax provisions and in evaluating tax positions. We will establish additional provisions for income taxes when, despite the belief that tax positions are fully supportable, there remain certain positions that do not meet the minimum probability threshold that a tax position is more likely than not to be sustained upon examination by the taxing authority. In the normal course of business, we and our subsidiaries are examined by various federal, state, and foreign tax authorities. We regularly assess the potential outcomes of these examinations and any future examinations for the current or prior years in determining the adequacy of the provision for income taxes. We periodically assess the likelihood and amount of potential adjustments and adjust the income tax provision, the current tax liability, and deferred taxes in the period in which the facts that give rise to a revision become known. (u) Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”) , which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. We adopted ASU 2019-12 on January 1, 2021. Adoption of the standard did not have a material impact on our financial position, results of operations and disclosures. On March 12, 2020, the FASB issued ASU No. 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued. The ASU is effective for all entities as of March 12, 2020, and will apply through December 31, 2022. To date, we have had no impacts on our investment portfolio or our credit agreement with Citizens Bank, N.A. related to reference rate reform. We will continue to evaluate the impact this guidance could have on our consolidated financial statements and related disclosures. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. (v) Recently Adopted Accounting Pronouncements In February 2016, the FASB released ASU 2016-02, Leases (Topic 842) (“ASU 2016-02”). Under ASU 2016-02, a right-of-use asset and lease obligation will be recorded for all leases with terms greater than 12 months, whether operating or financing, while the income statement will reflect lease expense for operating leases and amortization/interest expense for financing leases. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted, and permits modified retrospective method or cumulative-effect adjustment method. We adopted the standard on January 1, 2019, using the cumulative-effect adjustment transition method. As part of the adoption, we elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed carry forward of historical lease classifications. The adoption of this standard did not have a material impact on our financial position and results of operations. See “Note 16. Leases” for more detail regarding our disclosures. In February 2018, the FASB released ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220) , Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”). Prior to ASU 2018-02, GAAP required the remeasurement of deferred tax assets and liabilities as a result of a change in tax laws or rates to be presented in net income from continuing operations, even in situations in which the related income tax effects of items in accumulated other comprehensive income were originally recognized in other comprehensive income. As a result, such items, referred to as stranded tax effects, did not reflect the appropriate tax rate. Under ASU 2018-02, entities are permitted, but not required, to reclassify from accumulated other comprehensive income to retained earnings those stranded tax effects resulting from the Tax Act. ASU 2018-02 is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. We adopted ASU 2018-02 on January 1, 2019. Adoption of the standard did not have a material impact on our financial position, results of operations and disclosures. In June 2018, the FASB released ASU 2018-07, Compensation—Stock Compensation (Topic 718) , (“ASU 2018-07”), which expanded the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. ASU 2018-07 specifies that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. This update is effective for public entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. We adopted ASU 2018-07 on January 1, 2019. Adoption of the standard did not have a material impact on our financial position, results of operations, and disclosures. In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaces the incurred loss impairment methodology for measuring and recognizing credit losses with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. This amendment is effective for fiscal years beginning after December 15, 2019. We adopted the updated guidance on January 1, 2020 on a prospective basis recording $ 0.5 million as a cumulative effect adjustment to retained earnings and as a result, prior period amounts were not adjusted. Adoption of the standard did not have a material impact on our financial position, results of operations, and disclosures. In January 2017, the FASB released ASU 2017-04, Intangibles - Goodwill and Other (Topic 805): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”), which eliminates the Step 2 calculation for the implied fair value of goodwill to measure a goodwill impairment charge. Under the updated standard, an entity will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. ASU 2017-04 does not change the guidance on completing Step 1 of the goodwill impairment test and still allows an entity to perform the optional qualitative goodwill impairment assessment before determining whether to proceed to Step 1. This update is effective for annual and interim goodwill impairment tests in fiscal years beginning after December 15, 2019 with early adoption permitted for any impairment test performed on testing dates after January 1, 2017. We adopted ASU 2017-04 on January 1, 2020. This standard did not have a material impact on our financial position, results of operations, and disclosures . In August 2018, the FASB released ASU 2018-13, Fair Value Measurement (Topic 820), which modifies the disclosure requirements on fair value measurements in Topic 820, including the consideration of costs and benefits. This update is effective for public entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. We adopted ASU 2018-13 on January 1, 2020. This standard did not have a material impact on our financial position, results of operations, and disclosures . |
ASSET ACQUISITIONS AND BUSINESS
ASSET ACQUISITIONS AND BUSINESS COMBINATIONS | 12 Months Ended |
Dec. 31, 2020 | |
ASSET ACQUISITIONS AND BUSINESS COMBINATIONS [Abstract] | |
Asset Acquisitions And Business Combinations | NOTE 3. ASSET ACQUISITIONS AND BUSINESS COMBINATIONS Asset Acquisitions During the second quarter of 2020, the Company acquired Synoste Oy (“Synoste”), a Finnish engineering company that specializes in the research and development of a limb lengthening system. The fair value of the net assets acquired was $ 25.3 million, and the consideration consisted of approximately $ 22.8 million of cash paid at closing plus $ 2.5 million of a contractual holdback obligation payable eighteen months from the closing date of the transaction, subject to net working capital and other post-closing adjustments, if applicable. The contractual holdback obligation is included in accrued expenses in the consolidated balance sheet. The Company accounted for the transaction as an asset acquisition as substantially all of the fair value of the assets acquired was concentrated in a single identified asset, in-process research and development (“IPR&D”) of the limb lengthening system, thus satisfying the requirements of the screen test in ASU 2017-1. At the date of acquisition, the Company determined that the development of the projects underway at Synoste had not yet reached technological feasibility and that the research in process had no alternative future use. Accordingly, the acquired IPR&D of $ 24.4 million was charged to research and development expense in the consolidated statements of operations and comprehensive income. The transaction also provides for additional consideration contingent upon the developed product obtaining approval from the U.S. Food and Drug Administration (the “FDA”) of $ 8.0 million within the third anniversary, or $ 4.0 million within the fourth anniversary of the acquisition closing date, respectively. Contingent consideration is not recorded in an asset acquisition until the milestone is met. Business Combinations On October 1, 2020, the Company completed two acquisitions that were not considered material, individually or collectively, to the overall consolidated financial statements during the periods presented. These acquisitions have been included in the consolidated financial statements from the date of acquisition. The combined purchase price consisted of approximately $ 1.5 million of cash paid at closing, plus $ 0.3 million of other liabilities and $ 33.2 million of contingent consideration payments. These payments are based upon achieving various performance obligations over a period of 10 years, and are payable in a combination of cash and RSUs. The Company recorded other intangible assets of $ 8.8 million, with a weighted average useful life of 4.2 years, and goodwill of $ 26.2 million based on their preliminary estimated fair values. The Company will finalize the purchase price allocation of the assets and liabilities acquired within one year from the date of acquisition. While the Company does not expect material changes from the initial outcome of the valuation, certain assumptions and findings made at the date of acquisition could result in changes in the purchase price allocation. During the second quarter of 2019, the Company acquired substantially all of the assets of StelKast, Inc. (the “StelKast Acquisition”), a privately held company that designs, manufactures and distributes orthopedic implants for knee and hip replacement surgeries. The Company has included the financial results from the StelKast Acquisition in our consolidated financial statements from the acquisition date. At acquisition date, the fair value of the net assets acquired was $ 28.1 million. The purchase price consisted of approximately $ 23.8 million of cash paid at closing, plus $ 4.3 million of contingent consideration payable based upon the achievement product sales milestones. The Company recorded identifiable net assets, based on their estimated fair values, for inventory of $ 15.3 million, fixed assets of $ 4.2 million and customer relationships of $ 3.9 million and goodwill of $ 4.7 million. The contingent consideration payable related to the StelKast Acquisition of $ 5.0 million was paid during the third quarter of 2020. The payment up to the amount of the contingent consideration liability recognized at the acquisition date of $ 4.3 million is presented as a financing activity and the excess cash payment of $ 0.7 million is presented as an operating activity on the consolidated statement of cash flows as of the year ended December 31, 2020 in accordance with FASB ASC Topic 230, “Statement of Cash Flows” (ASC 230) . |
NET SALES
NET SALES | 12 Months Ended |
Dec. 31, 2020 | |
NET SALES [Abstract] | |
NET SALES | NOTE 4. NET SALES The following table represents net sales by product category: Year Ended December 31, (In thousands) 2020 2019 2018 Musculoskeletal Solutions $ 748,446 $ 738,377 $ 666,040 Enabling Technologies 40,596 46,991 46,929 Total net sales $ 789,042 $ 785,368 $ 712,969 |
NOTE RECEIVABLE
NOTE RECEIVABLE | 12 Months Ended |
Dec. 31, 2020 | |
NOTE RECEIVABLE [Abstract] | |
Note Receivable | NOTE 5. NOTE RECEIVABLE In September 2016, in connection with the acquisition of the international operations and distribution channels of Alphatec Holdings, Inc. (“Alphatec”), we entered into a Credit, Security and Guaranty Agreement (the “Credit Agreement”) with Alphatec and Alphatec Spine, Inc. (“Alphatec Spine” and together with Alphatec, the “Alphatec Borrowers”), pursuant to which we made available to the Alphatec Borrowers a senior secured term loan facility in an amount not to exceed $ 30.0 million. The term loan interest rate for the first two years following the Closing Date was priced at the London Interbank Offered Rate (“LIBOR”) plus 8.0 %, subject to a 9.5 % floor. The term loan interest rate thereafter was LIBOR plus 13.0 %. On the Closing Date, we made an initial loan of $ 25.0 million and the Alphatec Borrowers issued a note for such amount to us. In December 2016, the remaining $ 5.0 million was drawn by the Alphatec Borrowers and added to the note. In November 2018, the Alphatec Borrowers repaid all of the outstanding principal and interest under the Credit Agreement in a total amount of $ 29.3 million. |
MARKETABLE SECURITIES
MARKETABLE SECURITIES | 12 Months Ended |
Dec. 31, 2020 | |
MARKETABLE SECURITIES [Abstract] | |
Marketable Securities | NOTE 6. MARKETABLE SECURITIES The composition of our short-term and long-term marketable securities is as follows: December 31, 2020 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Short-term: Municipal bonds $ 39,684 $ 140 $ — $ 39,824 Corporate debt securities 97,937 817 ( 4 ) 98,750 Commercial paper 25,543 4 — 25,547 Asset-backed securities 15,232 44 — 15,276 Government, federal agency, and other sovereign obligations 7,886 61 — 7,947 Total short-term marketable securities $ 186,282 $ 1,066 $ ( 4 ) $ 187,344 Long-term: Municipal bonds $ 70,176 $ 612 $ — $ 70,788 Corporate debt securities 158,464 3,120 — 161,584 Asset-backed securities 124,406 1,747 ( 3 ) 126,150 Total long-term marketable securities $ 353,046 $ 5,479 $ ( 3 ) $ 358,522 December 31, 2019 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Short-term: Municipal bonds $ 7,840 $ 23 $ ( 1 ) $ 7,862 Corporate debt securities 69,091 247 ( 3 ) 69,335 Commercial paper 34,747 6 ( 1 ) 34,752 Asset-backed securities 3,808 6 — 3,814 Total short-term marketable securities $ 115,486 $ 282 $ ( 5 ) $ 115,763 Long-term: Municipal bonds $ 45,010 $ 254 $ ( 8 ) $ 45,256 Corporate debt securities 186,356 2,578 ( 5 ) 188,929 Asset-backed securities 161,347 1,583 ( 33 ) 162,897 Government, federal agency, and other sovereign obligations 12,366 66 — 12,432 Total long-term marketable securities $ 405,079 $ 4,481 $ ( 46 ) $ 409,514 The short-term marketable securities have effective maturity dates of less than one year and the long-term marketable securities have effective maturity dates ranging from one to three years as of December 31, 2020 and 2019, respectively. Purchases of marketable securities include amounts payable to brokers of $ 9.3 million and $ 10.3 million as of December 31, 2020 and 2019, respectively. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS [Abstract] | |
Fair Value Measurements | NOTE 7. FAIR VALUE MEASUREMENTS Assets and liabilities measured at fair value on a recurring basis as of December 31, 2020 and 2019, respectively included the following: (In thousands) Balance at December 31, 2020 Level 1 Level 2 Level 3 Assets Cash equivalents $ 56,223 $ 23,628 $ 32,595 $ — Municipal bonds 110,612 — 110,612 — Corporate debt securities 260,334 — 260,334 — Commercial paper 25,547 — 25,547 — Asset-backed securities 141,426 — 141,426 — Government, federal agency, and other sovereign obligations 7,947 — 7,947 — Liabilities Business acquisition liabilities 37,270 — — 37,270 (In thousands) Balance at December 31, 2019 Level 1 Level 2 Level 3 Assets Cash equivalents $ 18,218 $ 4,988 $ 13,230 $ — Municipal bonds 53,118 — 53,118 — Corporate debt securities 258,264 — 258,264 — Commercial paper 34,752 — 34,752 — Asset-backed securities 166,711 — 166,711 — Government, federal agency, and other sovereign obligations 12,432 — 12,432 — Liabilities Business acquisition liabilities 9,549 — — 9,549 Our marketable securities are classified as Level 2 within the fair value hierarchy, as we measure their fair value using quoted market prices for similar instruments and inputs such as actual trade data, benchmark yields, broker/dealer quotes and other similar data obtained from quoted market prices or independent pricing vendors . Assets and Liabilities That Are Measured at Fair Value on a Nonrecurring Basis Fair value of the revenue-based business acquisition liabilities was determined using a discounted cash flow model and an option pricing methodology. The significant inputs of such models are not observable in the market, such as certain financial metric growth rates, volatility and discount rates, market price risk adjustment, projections associated with the applicable milestone, the interest rate, and the related probabilities and payment structure in the contingent consideration arrangement. The following are the significant unobservable inputs used in the two valuation techniques: Unobservable input Range Weighted Average* Market risk adjustment 3.1 % - 4.3 % 3.3 % Discount rate 0.7 % - 8.5 % 5.1 % Probability of payment 36 % - 100 % 87.4 % Projected year of payment 2021 - 2030 2030 * The weighted average rates were calculated based on the relative fair value of each business acquisition liability. The change in the carrying value of the business acquisition liabilities during the years ended December 31, 2020 and 2019, respectively included the following: Year Ended December 31, (In thousands) 2020 2019 Beginning balance $ 9,549 $ 10,118 Purchase price contingent consideration 33,219 4,299 Changes resulting from foreign currency fluctuations — ( 58 ) Contingent cash payments ( 6,971 ) ( 6,597 ) Contingent RSU grants ( 191 ) — Changes in fair value of business acquisition liabilities 2,674 1,787 Contractual payable reclassification ( 1,010 ) — Ending balance $ 37,270 $ 9,549 |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2020 | |
INVENTORIES [Abstract] | |
Inventories | NOTE 8. INVENTORIES Inventories as of December 31, 2020 and 2019, respectively included the following: December 31, (In thousands) 2020 2019 Raw materials $ 39,646 $ 33,025 Work in process 16,446 15,940 Finished goods 173,061 147,349 Total inventories $ 229,153 $ 196,314 During years ended December 31, 2020, 2019, and 2018, net adjustments to cost of sales related to excess and obsolete inventory were $ 17.7 million, $ 2.5 million, and $ 10.5 million, respectively. The net adjustments for the years ended December 31, 2020, 2019, and 2018 reflect a combination of additional expense for excess and obsolete related provisions ($ 27.4 million, $ 11.2 million, and $ 17.6 million, respectively) offset by sales and disposals ($ 9.7 million, $ 8.7 million, and $ 7.1 million, respectively) of inventory for which an excess and obsolete provision was previously recorded. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 9. PROPERTY AND EQUIPMENT Property and equipment as of December 31, 2020 and 2019, respectively included the following: Useful December 31, (In thousands) Life 2020 2019 Land — $ 8,322 $ 8,290 Buildings and improvements 31.5 33,825 33,242 Equipment 5 - 15 102,553 97,829 Instruments 5 278,930 253,929 Modules and cases 5 41,919 38,293 Other property and equipment 3 - 5 27,781 11,990 493,330 443,573 Less: accumulated depreciation ( 276,451 ) ( 243,732 ) Total $ 216,879 $ 199,841 Instruments are hand-held devices used by surgeons to install implants during surgery. Modules and cases are used to store and transport the instruments and implants. Depreciation expense related to property and equipment was as follows: Year Ended December 31, (In thousands) 2020 2019 2018 Depreciation $ 46,043 $ 38,924 $ 32,042 In June 2018, we sold assets for $ 5.0 million, which resulted in a gain on sale of assets of $ 4.6 million and was recognized as other income in the consolidated statement of operations and comprehensive income. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2020 | |
GOODWILL AND INTANGIBLE ASSETS [Abstract] | |
Goodwill and Intangible Assets | NOTE 10. GOODWILL AND INTANGIBLE ASSETS The change in the carrying amount of goodwill during the years ended December 31, 2020 and 2019, respectively included the following: (In thousands) December 31, 2018 $ 123,734 Additions and adjustments 4,817 Foreign exchange 224 December 31, 2019 128,775 Additions and adjustments 26,043 Foreign exchange 1,898 December 31, 2020 $ 156,716 Intangible assets as of December 31, 2020 included the following: December 31, 2020 (In thousands) Weighted Average Amortization Period (in years) Gross Carrying Amount Accumulated Amortization Intangible Assets, net Supplier network 10.0 $ 4,000 $ ( 2,467 ) $ 1,533 Customer relationships & other intangibles 6.5 57,704 ( 32,056 ) 25,648 Developed technology 8.0 72,644 ( 19,295 ) 53,349 Patents 16.1 9,082 ( 2,663 ) 6,419 Total intangible assets $ 143,430 $ ( 56,481 ) $ 86,949 Due to the completion of contractual milestones related to the 2018 acquisition of Nemaris, in the first quarter of 2020, $ 13.0 million was capitalized to Developed Technology and is being amortized over a period of 5.4 years. Intangible assets as of December 31, 2019 included the following: December 31, 2019 (In thousands) Weighted Average Amortization Period (in years) Gross Carrying Amount Accumulated Amortization Intangible Assets, net Supplier network 10.0 $ 4,000 $ ( 2,067 ) $ 1,933 Customer relationships & other intangibles 7.0 46,766 ( 24,264 ) 22,502 Developed technology 8.6 57,577 ( 10,189 ) 47,388 Patents 16.0 8,662 ( 1,673 ) 6,989 Total intangible assets $ 117,005 $ ( 38,193 ) $ 78,812 The following table summarizes amortization of intangible assets for future periods as of December 31, 2020: (In thousands) Annual Amortization Year ending December 31: 2021 $ 18,858 2022 18,201 2023 15,983 2024 12,829 2025 8,801 Thereafter 12,277 Total $ 86,949 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2020 | |
ACCRUED EXPENSES [Abstract] | |
Accrued Expenses | NOTE 11. ACCRUED EXPENSES Accrued expenses as of December 31, 2020 and 2019, respectively included the following: December 31, (In thousands) 2020 2019 Compensation and other employee-related costs $ 44,948 $ 37,178 Legal and other settlements and expenses 650 1,538 Accrued non-income taxes 4,952 4,996 Royalties 3,720 2,370 Other 24,064 17,201 Total accrued expenses $ 78,334 $ 63,283 |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2020 | |
DEBT [Abstract] | |
Debt | NOTE 12. DEBT Line of Credit In August 2020, we entered into a credit agreement with Citizens Bank, N.A. (the “Credit Agreement”) that provides a revolving credit facility permitting borrowings up to $ 125.0 million (the “Revolving Credit Facility”), and has a termination date of August 5, 2021 . The Revolving Credit Facility includes up to a $ 25.0 million sub limit for letters of credit. Revolving loans under the Credit Agreement will bear interest, at the Company’s option, at either a base rate or the Adjusted LIBOR Rate (as defined in the Credit Agreement), plus, in each case, an applicable margin, as determined in accordance with the provisions of the Credit Agreement. The base rate will be the highest of: the rate of interest announced publicly by Citizens Bank, N.A. from time to time as its “prime rate”; the federal funds effective rate plus 1/2 of 1 %; and the Adjusted LIBOR Rate for a one-month period plus 1 %. The applicable margin is subject to adjustment as provided in the Credit Agreement. The Credit Agreement contains financial and other customary covenants, including a maximum leverage ratio. In May 2011, we entered into a credit agreement with Wells Fargo Bank related to a revolving credit facility that provided for borrowings up to $ 50.0 million. In June 2018, we amended the credit agreement to increase the revolving credit facility amount from $ 50.0 million to $ 125.0 million. At our request, and with the approval of the bank, the amount of borrowings available under the revolving credit facility increased to $ 150.0 million. The revolving credit facility included up to a $ 25.0 million sub-limit for letters of credit. As amended to date, the revolving credit facility with Wells Fargo Bank expired in May 2020. |
EQUITY
EQUITY | 12 Months Ended |
Dec. 31, 2020 | |
EQUITY [Abstract] | |
Equity | NOTE 13. EQUITY Stock Repurchases Under the stock repurchase plan, announced in March 2020, the Company is authorized to repurchase up to $ 200 million of the Company’s Class A common stock. As of December 31, 2020, $ 95.3 million of this authorization was remaining. The timing and actual number of shares repurchased will depend on various factors including price, corporate and regulatory requirements, debt covenant requirements, alternative investment opportunities and other market conditions. Funding for share repurchases in the future is expected to come from operating cash flows and excess cash. Shares repurchased by the Company are accounted for under the constructive retirement method, in which the shares repurchased, are immediately retired, as there is no plan to reissue the shares. The Company made an accounting policy election to charge the excess of repurchase price over par value entirely to retained earnings. The following table summarizes share repurchases made during the year ended December 31, 2020: (In thousands except for per share prices) Period Total number of shares repurchased Average Price Paid per Share Dollar amount of shares repurchased (1) Approximate dollar value of shares that may yet be purchased under the plan January 1, 2020 - March 31, 2020 1,920 $ 38.49 $ 73,902 $ 126,098 April 1, 2020 - June 30, 2020 771 39.95 30,804 95,294 July 1, 2020 - September 30,2020 — — — 95,294 October 1, 2020 – December 31, 2020 — — — 95,294 January 1, 2020 – December 31, 2020 2,691 $ 38.91 $ 104,706 (1) Inclusive of an immaterial amount of commission fees Common Stock Our amended and restated Certificate of Incorporation provides for a total of 775,000,000 authorized shares of common stock. Of the authorized number of shares of common stock, 500,000,000 shares are designated as Class A common stock (“Class A Common”) and 275,000,000 shares are designated as Class B common stock (“Class B Common”). The holders of Class A Common are entitled to one vote for each share of Class A Common held. Each share of our Class B common stock is convertible at any time at the option of the holder into one share of our Class A common stock. In addition, each share of our Class B common stock will convert automatically into one share of our Class A common stock upon any transfer, whether or not for value, except for permitted transfers. For more details relating to the conversion of our Class B common stock please see “Exhibit 4.2, Description of Securities of the Registrant” filed herein. The holders of Class B Common are entitled to 10 votes for each share of Class B Common held. The holders of Class A Common and Class B Common vote together as one class of common stock. Except for voting rights, the Class A Common and Class B Common have the same rights and privileges. Accumulated Other Comprehensive Income (Loss) The tables below present the changes in each component of accumulated other comprehensive income/(loss), including current period other comprehensive income/(loss) and reclassifications out of accumulated other comprehensive income/(loss) for the years ended December 31, 2020 and 2019, respectively: (In thousands) Unrealized loss on marketable securities, net of tax Foreign currency translation adjustments Accumulated other comprehensive loss Accumulated other comprehensive loss, net of tax, at December 31, 2019 $ 3,599 $ ( 6,497 ) $ ( 2,898 ) Other comprehensive (loss)/income before reclassifications 1,827 5,451 7,278 Amounts reclassified from accumulated other comprehensive income, net of tax ( 425 ) — ( 425 ) Other comprehensive (loss)/income, net of tax 1,402 5,451 6,853 Accumulated other comprehensive loss, net of tax, at December 31, 2020 $ 5,001 $ ( 1,046 ) $ 3,955 (In thousands) Unrealized loss on marketable securities, net of tax Foreign currency translation adjustments Accumulated other comprehensive loss Accumulated other comprehensive loss, net of tax, at December 31, 2018 $ ( 168 ) $ ( 7,004 ) $ ( 7,172 ) Other comprehensive (loss)/income before reclassifications 4,932 507 5,439 Amounts reclassified from accumulated other comprehensive income, net of tax ( 1,165 ) — ( 1,165 ) Other comprehensive (loss)/income, net of tax 3,767 507 4,274 Accumulated other comprehensive loss, net of tax, at December 31, 2019 $ 3,599 $ ( 6,497 ) $ ( 2,898 ) Amounts reclassified from accumulated other comprehensive loss, net of tax, related to unrealized gains/losses on marketable securities were released to other income, net in our consolidated statements of operations and comprehensive income. Net Income (Loss) Per Common Share The Company computes basic net income per share using the weighted-average number of common shares outstanding during the period. Diluted net income per share assumes the conversion, exercise or issuance of all potential common stock equivalents, unless the effect of inclusion would be anti-dilutive. For purposes of this calculation, common stock equivalents include the Company’s stock options and unvested RSUs. The contingently issuable shares are included in basic net income per share as of the date that all necessary conditions have been satisfied and are included in the denominator for dilutive calculation for the entire period if such shares would be issuable as of the end of the reporting period assuming the end of the reporting period was the end of the contingency period. The following table sets forth the computation of basic and diluted earnings per share: Year Ended December 31, (In thousands, except per share amounts) 2020 2019 2018 Numerator: Net income/(loss) $ 102,285 $ 155,210 $ 156,474 Denominator for basic and diluted net income per share: Weighted average shares outstanding for basic 98,580 99,150 97,884 Dilutive stock options 2,391 2,848 3,432 Weighted average shares outstanding for diluted 100,971 101,998 101,316 Earnings per share: Basic $ 1.04 $ 1.57 $ 1.60 Diluted $ 1.01 $ 1.52 $ 1.54 Anti-dilutive stock options and RSUs excluded from the calculation 5,454 4,494 2,451 |
STOCK-BASED AWARDS
STOCK-BASED AWARDS | 12 Months Ended |
Dec. 31, 2020 | |
STOCK-BASED AWARDS [Abstract] | |
Stock-Based Awards | NOTE 14. STOCK-BASED AWARDS We have three stock plans: our Amended and Restated 2003 Stock Plan, our 2008 Stock Plan, and our 2012 Equity Incentive Plan (the “2012 Plan”). The 2012 Plan is the only active stock plan. The purpose of these stock plans was, and of the 2012 Plan is, to provide incentive to employees, directors, and consultants of Globus. The Plans are administered by the Board of Directors of Globus (the “Board”) or its delegates. The number, type of option, exercise price, and vesting terms are determined by the Board or its delegates in accordance with the terms of the Plans. The options granted expire on a date specified by the Board, which is generally not more than ten years from the grant date. Options granted to employees generally vest in varying installments over a four-year period. The 2012 Plan was approved by our Board in March 2012, and by our stockholders in June 2012. Under the 2012 Plan, the aggregate number of shares of Class A Common stock that may be issued subject to options and other awards is equal to the sum of (i) 3,076,923 shares, (ii) any shares available for issuance under the 2008 Plan as of March 13, 2012, (iii) any shares underlying awards outstanding under the 2008 Plan as of March 13, 2012 that, on or after that date, are forfeited, terminated, expired or lapse for any reason, or are settled for cash without delivery of shares and (iv) starting January 1, 2013, an annual increase in the number of shares available under the 2012 Plan equal to up to 3 % of the number of shares of our common and preferred stock outstanding at the end of the previous year, as determined by our Board. The number of shares that may be issued or transferred pursuant to incentive stock options under the 2012 Plan is limited to 10,769,230 shares. The shares of Class A Common stock covered by the 2012 Plan include authorized but unissued shares, treasury shares or shares of common stock purchased on the open market. As of December 31, 2020, pursuant to the 2012 Plan, there were 17,899,947 shares of Class A Common stock reserved and 2,109,742 shares of Class A Common stock available for future grants. Stock Options Stock option activity during the year ended December 31, 2020 is summarized as follows: Option Shares (thousands) Weighted average exercise price Weighted average remaining contractual life (years) Aggregate intrinsic value (thousands) Outstanding at December 31, 2019 10,650 $ 35.80 Granted 2,411 52.40 Exercised ( 2,581 ) 28.03 Forfeited ( 734 ) 43.78 Outstanding at December 31, 2020 9,746 $ 41.33 7.3 $ 232,813 Exercisable at December 31, 2020 4,574 $ 33.72 6.1 $ 144,050 Expected to vest at December 31, 2020 5,172 $ 48.06 8.3 $ 88,763 The total intrinsic value of stock options exercised was $ 76.1 million, $ 31.3 million, and $ 59.3 million, during the years ended December 31, 2020, 2019, and 2018, respectively. The fair value of the options was estimated on the date of the grant using a Black-Scholes option pricing model with the following assumptions: Year Ended December 31, 2020 2019 2018 Risk-free interest rate 0.23 % - 1.67 % 1.35 % - 2.57 % 2.30 % - 3.09 % Expected term (years) 4.9 5.0 5.8 - 7.5 Expected volatility 28.0 % - 37.0 % 29.0 % 23.0 % - 28.0 % Expected dividend yield —% —% —% The weighted average grant date fair value of stock options granted during the years ended December 31, 2020, 2019, and 2018 was $ 14.81 , $ 13.76 , and $ 14.90 per share, respectively. Restricted Stock Units Restricted stock unit activity during the year ended December 31, 2020 is summarized as follows: Restricted Stock Units (thousands) Weighted average grant date fair value per share Weighted average remaining contractual life (years) Outstanding at December 31, 2019 — $ — Granted 3 58.69 Exercised — — Forfeited — — Expected to vest at December 31, 2020 3 $ 58.69 10 Stock-Based Compensation Compensation expense related to stock options granted to employees and non-employees under the Plans and the intrinsic value of stock options exercised was as follows: Year Ended December 31, (In thousands) 2020 2019 2018 Stock-based compensation expense $ 27,073 $ 26,085 $ 21,899 Net stock-based compensation capitalized into inventory 257 331 320 Total stock-based compensation cost $ 27,330 $ 26,416 $ 22,219 As of December 31, 2020, there was $ 58.0 million of unrecognized compensation expense related to unvested employee stock options that vest over a weighted average period of two years . |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES [Abstract] | |
Income Taxes | NOTE 15. INCOME TAXES The components of income before income taxes are as follows: Year Ended December 31, (In thousands) 2020 2019 2018 Domestic $ 154,356 $ 179,194 $ 180,701 Foreign ( 28,457 ) 10,752 7,904 Total $ 125,899 $ 189,946 $ 188,605 The components of the provision for income taxes are as follows: Year Ended December 31, (In thousands) 2020 2019 2018 Current: Federal $ 22,183 $ 23,093 $ 23,774 State 4,381 4,532 4,662 Foreign 991 2,819 2,724 27,555 30,444 31,160 Deferred: Federal ( 3,293 ) 6,542 4,155 State ( 678 ) ( 68 ) ( 587 ) Foreign 30 ( 2,182 ) ( 2,597 ) ( 3,941 ) 4,292 971 Total $ 23,614 $ 34,736 $ 32,131 A reconciliation of the statutory U.S. federal tax rate to our effective rate is as follows: Year Ended December 31, 2020 2019 2018 Statutory U.S. federal tax rate 21.0 % 21.0 % 21.0 % State income taxes, net of federal benefit 3.5 2.2 2.3 Foreign taxes 0.6 0.3 1.2 Valuation allowance 1.7 0.1 0.5 Domestic production activities deduction ( 0.3 ) ( 0.6 ) ( 0.7 ) Tax credits ( 2.6 ) ( 2.6 ) ( 1.6 ) Stock-based compensation windfall ( 9.5 ) ( 2.5 ) ( 5.2 ) Nondeductible expenses 0.5 0.3 ( 0.6 ) Other — 0.1 0.1 IPR&D 3.9 — — Effective tax rate 18.8 % 18.3 % 17.0 % Deferred income taxes reflect the tax effects of temporary differences between the basis of assets and liabilities recognized for financial reporting purposes and tax purposes. Significant components of our deferred income taxes are as follows: December 31, (In thousands) 2020 2019 Deferred tax assets: Inventory reserve $ 28,973 $ 26,381 Accruals, reserves, and other currently not deductible 12,537 8,620 Stock-based compensation 14,297 14,020 Net operating loss carryforwards 4,269 3,857 Total deferred tax assets 60,076 52,878 Valuation allowance ( 6,487 ) ( 2,846 ) Total deferred tax assets, net of valuation allowance 53,589 50,032 Deferred tax liabilities: Depreciation and amortization ( 53,176 ) ( 50,129 ) Total deferred tax liabilities ( 53,176 ) ( 50,129 ) Net deferred tax assets/(liabilities) $ 413 $ ( 97 ) In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more likely than not that we will realize a portion of the benefits of these deductible differences at December 31, 2020 and 2019. The Company has established valuation allowances of $ 6.5 million and $ 2.8 million at December 31, 2020 and 2019, respectively, primarily related to the uncertainty of the utilization of certain deferred tax assets and primarily comprised of tax loss carryforwards in various jurisdictions. The increase in the valuation allowance during fiscal year 2020 is primarily driven by foreign tax assets that are not expected to be realized. The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carryforward period are reduced. As of December 31, 2020 and 2019, we have NOL carryforwards of $ 26.1 million and $ 21.4 million, respectively, which, if unused, will expire in years 2021 through 2037. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: Year Ended December 31, (In thousands) 2020 2019 2018 Unrecognized tax benefits at the beginning of the year $ 2,399 $ 4,777 $ 2,601 Additions related to prior year tax positions — — 2,176 Reductions related to prior year tax positions ( 799 ) ( 2,378 ) — Unrecognized tax benefits at the end of the year $ 1,600 $ 2,399 $ 4,777 The reduction s related to prior year tax positions for the year ended December 31, 2020 of $ 0.8 million are primarily related to resolution of certain tax positions confirmed from refunds on amended tax returns. The impact of our unrecognized tax benefits to the effective income tax rate is as follows: December 31, (In thousands) 2020 2019 2018 Portion of total unrecognized tax benefits that, if recognized, would affect the effective income tax rate $ 2,032 $ 2,878 $ 4,084 The Company intends to indefinitely reinvest its foreign earnings abroad to ensure sufficient working capital for further expansion of its existing operations outside the United States, therefore the Company has not recorded income taxes on the undistributed earnings of its foreign subsidiaries. The undistributed earnings of our foreign subsidiaries as of December 31, 2020 are immaterial. In the event we are required to repatriate funds from outside of the United States, such repatriation may be subject to local laws, customs, and tax consequences. Interest and penalties are recorded in the statement of income as provision for income taxes. The total interest and penalties recorded in the statement of income was nominal for the years ended December 31, 2020, 2019, and 2018. We do not expect a significant change in our uncertain tax benefits in the next twelve months. We are subject to federal income tax as well as income tax of multiple state and foreign jurisdictions. With few exceptions, we are no longer subject to income tax examination by tax authorities in major jurisdictions for years prior to 2015 as of December 31, 2020. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2020 | |
LEASES [Abstract] | |
Leases | NOTE 16. LEASES The Company leases certain equipment, vehicles, and facilities under operating leases. Our leases have initial lease terms ranging from one year to 14 years. Certain leases contain options to extend terms beyond the lease termination date. We use judgment to determine whether it is reasonably possible that we will extend the lease beyond the initial term and the length of the possible extension. Leases that have a term of less than 12 months are treated as short-term and are not recognized as right of use assets or lease liabilities. As most leases do not provide an implicit rate, we use an estimate of our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. As of December 31, 2020, the Company’s short-term lease commitments and sublease income are immaterial. The Company classifies right-of-use assets as other assets, short-term lease liabilities as accrued expenses, and long-term lease liabilities as other liabilities on the consolidated balance sheets. Lease expense is recognized, on a straight-line basis over the term of the lease, as a component of operating income on the consolidated statements of operations and comprehensive income. Amounts reported in the consolidated balance sheet as of the years ended December 31, 2020 and 2019, respectively are as follows: December 31, (In thousands, except weighted average lease term and discount rate) 2020 2019 Operating lease right of use asset $ 4,741 $ 2,481 Lease liability - current 1,865 1,339 Lease liability - long-term 2,936 1,142 Total operating lease liability $ 4,801 $ 2,481 Operating lease expense $ 3,579 $ 3,174 Supplemental non-cash information: Weighted-average remaining lease term (years) - operating leases 2.9 2.6 Weighted-average discount rate - operating leases 3.0 % 3.4 % The following table summarized the future minimum lease payments under non-cancellable leases as of December 31, 2020: (In thousands) Operating Leases 2021 $ 1,987 2022 1,535 2023 815 2024 565 2025 159 Thereafter — Total undiscounted operating lease payments $ 5,061 Less: imputed interest 260 Total operating lease liability $ 4,801 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
Commitments and Contingencies | NOTE 17. COMMITMENTS AND CONTINGENCIES We are involved in a number of proceedings, legal actions, and claims arising in the ordinary course of business. Such matters are subject to many uncertainties, and the outcomes of these matters are not within our control and may not be known for prolonged periods of time. In some actions, the claimants seek damages, as well as other relief, including injunctions prohibiting us from engaging in certain activities, which, if granted, could require significant expenditures and/or result in lost revenues. We record a liability in the consolidated financial statements for these actions when a loss is considered probable and the amount can be reasonably estimated. If the reasonable estimate of a probable loss is a range, and no amount in the range is a better estimate than any other, the minimum amount of the range is accrued. If a loss is reasonably possible but not known or probable, and can be reasonably estimated, the estimated loss or range of loss is disclosed. In most cases, significant judgment is required to estimate the amount and timing of a loss to be recorded. While it is not possible to predict the outcome for most of the matters discussed, we believe it is possible that costs associated with them could have a material adverse impact on our consolidated earnings, financial position or cash flows. L5 Litigation In December 2009, we filed suit in the Court of Common Pleas of Montgomery County, Pennsylvania against our former exclusive independent distributor L5 Surgical, LLC and its principals, seeking an injunction and declaratory judgment concerning certain restrictive covenants made to L5 by its sales representatives. L5 brought counterclaims against us alleging tortious interference, unfair competition and conspiracy. The injunction phase was resolved in September 2010 and the remaining claims were fully resolved through settlement by the parties on February 6, 2019. Moskowitz Family LLC Litigation On November 20, 2019, Moskowitz Family LLC filed suit against us in the U.S. District Court for the Western District of Texas for patent infringement. Moskowitz, a non-practicing entity, alleges that Globus willfully infringes one or more claims of eight patents by making, using, offering for sale or selling the Coalition ® , Coalition MIS ® , Coalition AGX ® , Monument ® , MAGNIFY ® -S, HEDRON IA TM , HEDRON IC TM , Independence ® , Independence MIS ® , Fortify ® and XPand ® families , SABLE TM , Rise ® , Rise ® Intralif, Rise ® -L, ELSA ® , ELSA ® ATP, RASS, Altera ® , Ariel ® , Latis ® , Caliber ® and Caliber ® -L products. Moskowitz seeks an unspecified amount in damages and injunctive relief. On July 2, 2020, this suit was transferred from the U.S. District Court for the Western District of Texas to the U.S. District Court for the Eastern District of Pennsylvania and was stayed on September 25, 2020 pending the outcome of earlier filed Inter Partes Reviews. The outcome of this litigation cannot be determined, nor can we estimate a range of potential loss, therefore, we have not recorded a liability related to this litigation as of December 31, 2020. |
RETIREMENT BENEFIT PLANS
RETIREMENT BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2020 | |
RETIREMENT BENEFIT PLANS [Abstract] | |
Retirement Benefit Plans | NOTE 18. RETIREMENT BENEFIT PLANS We sponsor a 401(k) Plan covering all eligible U.S. employees. Under the 401(k) Plan, we make nondiscretionary matching contributions at the rate of 100 % of employee’s contributions up to a maximum annual contribution of $ 6,000 per eligible employee, limited to 3 % of the employee’s compensation for the period. Additionally, we contribute to various foreign retirement benefit plans required by local law or coordinated with government sponsored plans which cover many of our international employees. The benefits offered under these plans are reflective of local customs and practices in the countries concerned. Company contributions to these retirement plans were as follows: Year Ended December 31, (In thousands) 2020 2019 2018 401(k) and other retirement plan contributions $ 5,798 $ 5,363 $ 4,682 |
SEGMENT AND GEOGRAPHIC INFORMAT
SEGMENT AND GEOGRAPHIC INFORMATION | 12 Months Ended |
Dec. 31, 2020 | |
SEGMENT AND GEOGRAPHIC INFORMATION [Abstract] | |
Segment and Geographic Information | NOTE 19. SEGMENT AND GEOGRAPHIC INFORMATION Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. We manage our business globally within one operating segment. Segment information is consistent with how management reviews the business, makes investing and resource allocation decisions and assesses operating performance. The following table represents total net sales by geographic area, based on the location of the customer for the years ended December 31, 2020, 2019 and 2018, respectively: Year Ended December 31, (In thousands) 2020 2019 2018 United States $ 664,454 $ 647,683 $ 593,878 International 124,588 137,685 119,091 Total net sales $ 789,042 $ 785,368 $ 712,969 |
QUARTERLY FINANCIAL DATA
QUARTERLY FINANCIAL DATA | 12 Months Ended |
Dec. 31, 2020 | |
QUARTERLY FINANCIAL DATA [Abstract] | |
Quarterly Financial Data | NOTE 20. QUARTERLY FINANCIAL DATA (unaudited) (unaudited) March 31, June 30, September 30, December 31, (In thousands, except per share amounts) 2020 2020 2020 2020 Net sales $ 190,577 $ 148,922 $ 216,098 $ 233,445 Gross profit 141,713 98,279 159,001 172,586 Net income/(loss) 25,949 ( 20,837 ) 44,216 52,957 Earnings per share - basic 0.26 ( 0.21 ) 0.45 0.54 Earnings per share - diluted 0.25 ( 0.21 ) 0.44 0.52 * amounts might not add due to rounding (unaudited) March 31, June 30, September 30, December 31, (In thousands, except per share amounts) 2019 2019 2019 2019 Net sales $ 182,947 $ 194,539 $ 196,215 $ 211,667 Gross profit 141,109 150,549 150,828 162,907 Net income/(loss) 33,210 38,163 38,307 45,530 Earnings per share - basic 0.34 0.39 0.39 0.46 Earnings per share - diluted 0.33 0.38 0.38 0.44 * amounts might not add due to rounding |
SCHEDULE II VALUATION ACCOUNTS
SCHEDULE II VALUATION ACCOUNTS AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2020 | |
SCHEDULE II VALUATION ACCOUNTS AND QUALIFYING ACCOUNTS [Abstract] | |
Schedule II Valuation Accounts and Qualifying Accounts | SCHEDULE II. VALUATION ACCOUNTS AND QUALIFYING ACCOUNTS Allowance for doubtful accounts: (In thousands) Beginning of period Charged to expenses Write-offs End of period Year ended December 31, 2018 $ 3,963 $ 960 $ ( 697 ) $ 4,226 Year ended December 31, 2019 4,226 3,026 ( 1,653 ) 5,599 Year ended December 31, 2020 $ 5,599 $ 2,960 $ ( 4,151 ) $ 4,408 Deferred tax valuation allowance: Additions Deductions (In thousands) Beginning of period Charged to expenses Charged to other accounts Other deductions End of period Year ended December 31, 2018 $ 1,821 $ 924 $ — $ ( 62 ) $ 2,683 Year ended December 31, 2019 2,683 163 — — 2,846 Year ended December 31, 2020 $ 2,846 $ 2,132 $ 1,509 $ — $ 6,487 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policy) | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”). |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of Globus and its wholly owned subsidiaries. All intercompany balances and transactions are eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. We base our estimates, in part, on historical experience that management believes to be reasonable under the circumstances. Actual results could differ from those estimates. Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Significant areas that require estimates include revenue recognition, intangible assets, business acquisition liabilities, allowance for doubtful accounts, stock-based compensation, reserves for excess and obsolete inventory, useful lives of assets, the outcome of litigation, recoverability of intangible assets and income taxes. We are subject to risks and uncertainties due to changes in the healthcare environment, regulatory oversight, competition, and legislation that may cause actual results to differ from estimated results. |
Revenue Recognition | Revenue Recognition Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. Sales and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. For purposes of disclosure, we disaggregate our revenue into two categories, Musculoskeletal Solutions and Enabling Technologies. Our Musculoskeletal Solutions products consist primarily of the implantable devices, disposables, and unique instruments used in an expansive range of spine, orthopedic trauma, hip, knee and extremity procedures. The majority of our Musculoskeletal Solutions contracts have a single performance obligation and revenue is recognized at a point in time. Our Enabling Technologies products are advanced hardware and software systems, and related technologies, that are designed to enhance a surgeon’s capabilities and streamline surgical procedures by making them less invasive, more accurate, and more reproducible to improve patient care. The majority of our Enabling Technologies product contracts contain multiple performance obligations, including maintenance and support, and revenue is recognized as we fulfill each performance obligation. When contracts have multiple performance obligations, we allocate the contract’s transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. Our policy is to classify shipping and handling costs billed to customers as sales and the related expenses as cost of goods sold. Nature of Products and Services A significant portion of our Musculoskeletal Solutions product revenue is generated from consigned inventory maintained at hospitals or with sales representatives. Revenue from the sale of consigned musculoskeletal products is recognized when we transfer control, which occurs at the time the product is used or implanted. For all other Musculoskeletal Solutions product transactions, we recognize revenue when we transfer title to the goods, provided there are no remaining performance obligations that can affect the customer’s final acceptance of the sale. Revenue from the sale of Enabling Technologies products is generally recognized when control transfers to the customer which occurs at the time the product is shipped or delivered. Depending on the terms of the arrangement, we may also defer the recognition of a portion of the consideration as we satisfy future performance obligations related to the provision of maintenance and support. We use an observable price to determine the stand-alone selling price for each separate performance obligation. Contract Balances Timing of revenue recognition may differ from the timing of invoicing to customers. We record a receivable when revenue is recognized prior to invoicing, or deferred revenue when revenue is recognized subsequent to invoicing. Deferred revenue is comprised mainly of unearned revenue related to the sales of certain Enabling Technologies products, which includes maintenance and support services. Deferred revenue is generally invoiced annually at the beginning of each contract period and recognized ratably over the coverage period. For the years ended December 31, 2020, 2019, and 2018, there was an immaterial amount of revenue recognized from previously deferred revenue. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments, which potentially subject us to concentrations of credit risk, are primarily marketable securities and accounts receivable. Concentrations of credit risk with respect to accounts receivable are limited due to the large number of entities comprising our customer base. We perform ongoing credit evaluations of our customers and generally do not require collateral. There was no customer that accounted for 10% or more of sales for the years ended December 31, 2020, 2019, and 2018, respectively. |
Cash, Cash Equivalents, and Restricted Cash | Cash, Cash Equivalents, and Restricted Cash The Company considers all short-term, highly liquid investments with original maturities of 90 days or less at acquisition date to be cash equivalents. Cash equivalents, which consist of money market accounts, commercial paper and corporate debt securities are stated at fair value. |
Marketable Securities | Marketable Securities Our marketable securities include municipal bonds, corporate debt securities, commercial paper, asset-backed securities, and securities of government, federal agency, and other sovereign obligations, and are classified as available-for-sale as of December 31, 2020 and 2019. Short-term and long-term marketable securities are recorded at fair value on our consolidated balance sheets. Any change in fair value for available-for-sale securities, that do not result in recognition or reversal of an allowance for credit loss or write down, is recorded, net of taxes, as a component of accumulated other comprehensive income or loss on our consolidated balance sheets. Premiums and discounts are recognized over the life of the related security as an adjustment to yield using the straight-line method. Realized gains or losses from the sale of marketable securities are determined on a specific identification basis. Realized gains and losses, interest income and the amortization/accretion of premiums/discounts are included as a component of other income/(expense), net, on our consolidated statements of operations and comprehensive income. Interest receivable is recorded as a component of prepaid expenses and other current assets on our consolidated balance sheets. We invest in securities that meet or exceed standards as defined in our investment policy. Our policy also limits the amount of credit exposure to any one issue, issuer or type of security. We review our securities for other-than-temporary impairment at each reporting period. If an unrealized loss for any security is expected, the loss will be recognized on an allowance basis, consistent with ASC 326-30, in our consolidated statements of operations and comprehensive income in the period the determination is made. |
Fair Value Measurements | Fair Value Measurements Assets and Liabilities That Are Measured at Fair Value on a Recurring Basis Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or the liability in an orderly transaction between market participants on the measurement date. Additionally, a fair value hierarchy was established that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable inputs. The level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Our assets and liabilities measured at fair value on a recurring basis are classified and disclosed in one of the following three categories: Level 1—quoted prices (unadjusted) in active markets for identical assets and liabilities; Level 2—observable inputs other than quoted prices in active markets for identical assets and liabilities; and Level 3—unobservable inputs in which there is little or no market data available, which require the reporting entity to use significant unobservable inputs or valuation techniques. Assets and Liabilities That Are Measured at Fair Value on a Nonrecurring Basis The purchase price of business acquisitions is primarily allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values on the acquisition date, with the excess recorded as goodwill. We utilize Level 3 inputs in the determination of the initial fair value. Contingent consideration represents contingent milestone, performance and revenue-sharing payment obligations related to acquisitions and is measured at fair value, based on significant inputs that are not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The valuation of contingent consideration uses assumptions we believe would be made by a market participant. We assess these assumptions on an ongoing basis as additional data impacting the assumptions is obtained. The fair value of contingent consideration is recorded in business acquisition liabilities on our consolidated balance sheets, and changes in the fair value of contingent consideration is recognized in acquisition related costs in the consolidated statements of operations and comprehensive income. The fair value of contingent restricted stock unit (“RSU”) grants are recorded as additional paid-in capital in the consolidated balance sheet on the day of the grant due to the remote likelihood of forfeiture. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out basis. The majority of our inventory is finished goods and we utilize both in-house manufacturing and third-party suppliers to produce our products. We periodically evaluate the carrying value of our inventories in relation to estimated forecasts of product demand, which takes into consideration the life cycle of product releases. When quantities on hand exceed estimated sales forecasts, we record a write-down for such excess inventories. Once inventory has been written down, it creates a new cost basis for inventory that is not subsequently written up. |
Property and Equipment | Property and Equipment Property and equipment is recorded at cost less accumulated depreciation. Additions or improvements are capitalized, while repairs and maintenance are expensed as incurred. Depreciation is recognized using the straight-line method over the related useful lives of the assets. When assets are sold or otherwise disposed of, the related property, equipment, and accumulated depreciation amounts are relieved from the accounts, and any gain or loss is recorded in the consolidated statements of operations and comprehensive income. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill represents the excess of purchase price over the fair values of the identifiable assets acquired less the liabilities assumed in the acquisition of a business. Goodwill is tested for impairment at least annually. Goodwill is tested for impairment at the reporting unit level by comparing the reporting unit’s carrying amount to the fair value of the reporting unit. Fair values are estimated using an income and discounted cash flow approach. We perform our annual impairment test of goodwill in the fourth quarter of each year. We consider qualitative indicators of the fair value of a reporting unit when it is unlikely that a reporting unit has impaired goodwill. During the years ended December 31, 2020, 2019, and 2018, we did no t record any impairment charges related to goodwill. Intangible assets consist of purchased in-process research and development (“IPR&D”), developed technology, supplier network, patents, customer relationships, re-acquired rights, and non-compete agreements. Intangible assets with finite useful lives are amortized over the period of estimated benefit using the straight-line method and estimated useful lives ranging from one to sixteen years. Intangible assets are tested for impairment annually or whenever events or circumstances indicate that a carrying amount of an asset (asset group) may not be recoverable. If an impairment is indicated, we measure the amount of the impairment loss as the amount by which the carrying amount exceeds the fair value of the asset. Fair value is generally determined using a discounted future cash flow analysis. There were no impairments of finite-lived intangible assets during the years ended December 31, 2020, 2019, or 2018. IPR&D has an indefinite life and is not amortized until completion of the project at which time the IPR&D becomes an amortizable asset. If the related project is not completed in a timely manner, we may have an impairment related to the IPR&D, calculated as the excess of the asset’s carrying value over its fair value. There were no impairments of IPR&D during the years ended December 31, 2020, 2019, or 2018. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets We periodically evaluate the recoverability of the carrying amount of long-lived assets, which include property and equipment, as well as whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be fully recoverable. An impairment is assessed when the undiscounted future cash flows from the use and eventual disposition of an asset group are less than its carrying value. If an impairment is indicated, we measure the amount of the impairment loss as the amount by which the carrying amount exceeds the fair value of the asset group. Our fair value methodology is based on quoted market prices, if available. If quoted market prices are not available, an estimate of fair value is made based on prices of similar assets or other valuation techniques including present value techniques. During the years ended December 31, 2020, 2019, and 2018, we did no t record any impairment charges related to long-lived assets. |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold consists primarily of costs from our manufacturing operations, costs of products purchased from third-party suppliers, reserves for excess and obsolete inventory, depreciation of surgical instruments and cases, royalties, shipping, inspection and related costs incurred in making our products available for sale or use. |
Research and Development | Research and Development Research and development costs are expensed as incurred. Research and development costs include salaries, employee benefits, supplies, consulting services, clinical services and clinical trial costs, and facilities costs. Costs incurred in obtaining technology licenses and patents are charged immediately to research and development expense if the technology licensed has not reached technological feasibility and has no alternative future use. |
Stock-Based Compensation | Stock -Based Compensation The cost of employee and non-employee director awards is measured at the grant date fair value of the award and is recognized as expense over the requisite service period, which is generally the vesting period of the equity award. Compensation expense for awards includes the impact of forfeiture in the period when they occur. We estimate the fair value of stock options utilizing the Black-Scholes option-pricing model. Inputs to the Black-Scholes model include our stock price, expected volatility, expected term, risk-free interest rate and expected dividends. Expected volatility is based on the historical volatility of the Company’s common stock over the most recent period commensurate with the estimated expected term of the Company’s stock options offering period which is derived from historical experience. The risk-free interest rate assumption is based on observed interest rates of U.S. Treasury securities appropriate for the expected terms of the stock options. The dividend yield assumption is based on the history and expectation of no dividend payouts. The fair value of restricted stock units is estimated on the day of grant based on the closing price of the Company’s common stock. |
Advertising Expense | Advertising Expense We expense advertising costs as they are incurred. Advertising expense was $ 0.6 million, $ 1.1 million, and $ 1.9 million for the years ended December 31, 2020, 2019, and 2018, respectively. |
Provision for Litigation | Provision for Litigation We are involved in a number of proceedings, legal actions, and claims. Such matters are subject to many uncertainties, and the outcomes of these matters are not within our control and may not be known for prolonged periods of time. In some actions, the claimants seek damages, as well as other relief, including injunctions prohibiting us from engaging in certain activities, which, if granted, could require significant expenditures and/or result in lost revenues. We record a liability in the consolidated financial statements for these actions when a loss is considered probable and the amount can be reasonably estimated. If the reasonable estimate of a probable loss is a range, and no amount within the range is a better estimate than any other, the minimum amount of the range is accrued. If a loss is reasonably possible but not known or probable, and can be reasonably estimated, the estimated loss or range of loss is disclosed. In most cases, significant judgment is required to estimate the amount and timing of a loss to be recorded. We expense legal costs related to loss contingencies as incurred. |
Acquisition Related Costs | Acquisition Related Costs Acquisition related costs represents the change in fair value of business acquisition related contingent consideration; costs related to integrating recently acquired businesses including but not limited to costs to exit or convert contractual obligations, severance, and information system conversion; and specific costs related to the consummation of the acquisition process such as banker fees, legal fees, and other acquisition related professional fees. |
Foreign Currency Translation | Foreign Currency Translation The functional currency of our foreign subsidiaries is generally their local currency. Assets and liabilities of the foreign subsidiaries are translated at the period end currency exchange rate and revenues and expenses are translated at an average currency exchange rate for the period. The resulting foreign currency translation gains and losses are included as a component of accumulated other comprehensive income. Gains and losses arising from intercompany foreign transactions are included in other income, net on the consolidated statements of operations and comprehensive income. |
Income Taxes | Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year in which such items are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance is established to offset any deferred tax assets if, based upon available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. Significant judgment is required in determining income tax provisions and in evaluating tax positions. We will establish additional provisions for income taxes when, despite the belief that tax positions are fully supportable, there remain certain positions that do not meet the minimum probability threshold that a tax position is more likely than not to be sustained upon examination by the taxing authority. In the normal course of business, we and our subsidiaries are examined by various federal, state, and foreign tax authorities. We regularly assess the potential outcomes of these examinations and any future examinations for the current or prior years in determining the adequacy of the provision for income taxes. We periodically assess the likelihood and amount of potential adjustments and adjust the income tax provision, the current tax liability, and deferred taxes in the period in which the facts that give rise to a revision become known. |
Recently Issued Accounting Pronouncements & Recently Adopted Accounting Pronouncements | (u) Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”) , which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. We adopted ASU 2019-12 on January 1, 2021. Adoption of the standard did not have a material impact on our financial position, results of operations and disclosures. On March 12, 2020, the FASB issued ASU No. 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued. The ASU is effective for all entities as of March 12, 2020, and will apply through December 31, 2022. To date, we have had no impacts on our investment portfolio or our credit agreement with Citizens Bank, N.A. related to reference rate reform. We will continue to evaluate the impact this guidance could have on our consolidated financial statements and related disclosures. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. (v) Recently Adopted Accounting Pronouncements In February 2016, the FASB released ASU 2016-02, Leases (Topic 842) (“ASU 2016-02”). Under ASU 2016-02, a right-of-use asset and lease obligation will be recorded for all leases with terms greater than 12 months, whether operating or financing, while the income statement will reflect lease expense for operating leases and amortization/interest expense for financing leases. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted, and permits modified retrospective method or cumulative-effect adjustment method. We adopted the standard on January 1, 2019, using the cumulative-effect adjustment transition method. As part of the adoption, we elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed carry forward of historical lease classifications. The adoption of this standard did not have a material impact on our financial position and results of operations. See “Note 16. Leases” for more detail regarding our disclosures. In February 2018, the FASB released ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220) , Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”). Prior to ASU 2018-02, GAAP required the remeasurement of deferred tax assets and liabilities as a result of a change in tax laws or rates to be presented in net income from continuing operations, even in situations in which the related income tax effects of items in accumulated other comprehensive income were originally recognized in other comprehensive income. As a result, such items, referred to as stranded tax effects, did not reflect the appropriate tax rate. Under ASU 2018-02, entities are permitted, but not required, to reclassify from accumulated other comprehensive income to retained earnings those stranded tax effects resulting from the Tax Act. ASU 2018-02 is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. We adopted ASU 2018-02 on January 1, 2019. Adoption of the standard did not have a material impact on our financial position, results of operations and disclosures. In June 2018, the FASB released ASU 2018-07, Compensation—Stock Compensation (Topic 718) , (“ASU 2018-07”), which expanded the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. ASU 2018-07 specifies that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. This update is effective for public entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. We adopted ASU 2018-07 on January 1, 2019. Adoption of the standard did not have a material impact on our financial position, results of operations, and disclosures. In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaces the incurred loss impairment methodology for measuring and recognizing credit losses with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. This amendment is effective for fiscal years beginning after December 15, 2019. We adopted the updated guidance on January 1, 2020 on a prospective basis recording $ 0.5 million as a cumulative effect adjustment to retained earnings and as a result, prior period amounts were not adjusted. Adoption of the standard did not have a material impact on our financial position, results of operations, and disclosures. In January 2017, the FASB released ASU 2017-04, Intangibles - Goodwill and Other (Topic 805): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”), which eliminates the Step 2 calculation for the implied fair value of goodwill to measure a goodwill impairment charge. Under the updated standard, an entity will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. ASU 2017-04 does not change the guidance on completing Step 1 of the goodwill impairment test and still allows an entity to perform the optional qualitative goodwill impairment assessment before determining whether to proceed to Step 1. This update is effective for annual and interim goodwill impairment tests in fiscal years beginning after December 15, 2019 with early adoption permitted for any impairment test performed on testing dates after January 1, 2017. We adopted ASU 2017-04 on January 1, 2020. This standard did not have a material impact on our financial position, results of operations, and disclosures . In August 2018, the FASB released ASU 2018-13, Fair Value Measurement (Topic 820), which modifies the disclosure requirements on fair value measurements in Topic 820, including the consideration of costs and benefits. This update is effective for public entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. We adopted ASU 2018-13 on January 1, 2020. This standard did not have a material impact on our financial position, results of operations, and disclosures . |
NET SALES (Tables)
NET SALES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
NET SALES [Abstract] | |
Schedule of Disaggregation of Revenue | Year Ended December 31, (In thousands) 2020 2019 2018 Musculoskeletal Solutions $ 748,446 $ 738,377 $ 666,040 Enabling Technologies 40,596 46,991 46,929 Total net sales $ 789,042 $ 785,368 $ 712,969 |
MARKETABLE SECURITIES (Tables)
MARKETABLE SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
MARKETABLE SECURITIES [Abstract] | |
Composition of Marketable Securities | The composition of our short-term and long-term marketable securities is as follows: December 31, 2020 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Short-term: Municipal bonds $ 39,684 $ 140 $ — $ 39,824 Corporate debt securities 97,937 817 ( 4 ) 98,750 Commercial paper 25,543 4 — 25,547 Asset-backed securities 15,232 44 — 15,276 Government, federal agency, and other sovereign obligations 7,886 61 — 7,947 Total short-term marketable securities $ 186,282 $ 1,066 $ ( 4 ) $ 187,344 Long-term: Municipal bonds $ 70,176 $ 612 $ — $ 70,788 Corporate debt securities 158,464 3,120 — 161,584 Asset-backed securities 124,406 1,747 ( 3 ) 126,150 Total long-term marketable securities $ 353,046 $ 5,479 $ ( 3 ) $ 358,522 December 31, 2019 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Short-term: Municipal bonds $ 7,840 $ 23 $ ( 1 ) $ 7,862 Corporate debt securities 69,091 247 ( 3 ) 69,335 Commercial paper 34,747 6 ( 1 ) 34,752 Asset-backed securities 3,808 6 — 3,814 Total short-term marketable securities $ 115,486 $ 282 $ ( 5 ) $ 115,763 Long-term: Municipal bonds $ 45,010 $ 254 $ ( 8 ) $ 45,256 Corporate debt securities 186,356 2,578 ( 5 ) 188,929 Asset-backed securities 161,347 1,583 ( 33 ) 162,897 Government, federal agency, and other sovereign obligations 12,366 66 — 12,432 Total long-term marketable securities $ 405,079 $ 4,481 $ ( 46 ) $ 409,514 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS [Abstract] | |
Fair Value of Assets and Liabilities Measured on Recurring Basis | (In thousands) Balance at December 31, 2020 Level 1 Level 2 Level 3 Assets Cash equivalents $ 56,223 $ 23,628 $ 32,595 $ — Municipal bonds 110,612 — 110,612 — Corporate debt securities 260,334 — 260,334 — Commercial paper 25,547 — 25,547 — Asset-backed securities 141,426 — 141,426 — Government, federal agency, and other sovereign obligations 7,947 — 7,947 — Liabilities Business acquisition liabilities 37,270 — — 37,270 (In thousands) Balance at December 31, 2019 Level 1 Level 2 Level 3 Assets Cash equivalents $ 18,218 $ 4,988 $ 13,230 $ — Municipal bonds 53,118 — 53,118 — Corporate debt securities 258,264 — 258,264 — Commercial paper 34,752 — 34,752 — Asset-backed securities 166,711 — 166,711 — Government, federal agency, and other sovereign obligations 12,432 — 12,432 — Liabilities Business acquisition liabilities 9,549 — — 9,549 |
Nonrecurring Level 3 Fair Value Measurements | Unobservable input Range Weighted Average* Market risk adjustment 3.1 % - 4.3 % 3.3 % Discount rate 0.7 % - 8.5 % 5.1 % Probability of payment 36 % - 100 % 87.4 % Projected year of payment 2021 - 2030 2030 * The weighted average rates were calculated based on the relative fair value of each business acquisition liability. |
Rollforward of Contingent Consideration | The change in the carrying value of the business acquisition liabilities during the years ended December 31, 2020 and 2019, respectively included the following: Year Ended December 31, (In thousands) 2020 2019 Beginning balance $ 9,549 $ 10,118 Purchase price contingent consideration 33,219 4,299 Changes resulting from foreign currency fluctuations — ( 58 ) Contingent cash payments ( 6,971 ) ( 6,597 ) Contingent RSU grants ( 191 ) — Changes in fair value of business acquisition liabilities 2,674 1,787 Contractual payable reclassification ( 1,010 ) — Ending balance $ 37,270 $ 9,549 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INVENTORIES [Abstract] | |
Schedule of Inventory | December 31, (In thousands) 2020 2019 Raw materials $ 39,646 $ 33,025 Work in process 16,446 15,940 Finished goods 173,061 147,349 Total inventories $ 229,153 $ 196,314 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT [Abstract] | |
Schedule of Property and Equipment | Useful December 31, (In thousands) Life 2020 2019 Land — $ 8,322 $ 8,290 Buildings and improvements 31.5 33,825 33,242 Equipment 5 - 15 102,553 97,829 Instruments 5 278,930 253,929 Modules and cases 5 41,919 38,293 Other property and equipment 3 - 5 27,781 11,990 493,330 443,573 Less: accumulated depreciation ( 276,451 ) ( 243,732 ) Total $ 216,879 $ 199,841 |
Schedule of Depreciation Related to Property and Equipment | Year Ended December 31, (In thousands) 2020 2019 2018 Depreciation $ 46,043 $ 38,924 $ 32,042 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
GOODWILL AND INTANGIBLE ASSETS [Abstract] | |
Summary of Intangible Assets | Intangible assets as of December 31, 2020 included the following: December 31, 2020 (In thousands) Weighted Average Amortization Period (in years) Gross Carrying Amount Accumulated Amortization Intangible Assets, net Supplier network 10.0 $ 4,000 $ ( 2,467 ) $ 1,533 Customer relationships & other intangibles 6.5 57,704 ( 32,056 ) 25,648 Developed technology 8.0 72,644 ( 19,295 ) 53,349 Patents 16.1 9,082 ( 2,663 ) 6,419 Total intangible assets $ 143,430 $ ( 56,481 ) $ 86,949 Due to the completion of contractual milestones related to the 2018 acquisition of Nemaris, in the first quarter of 2020, $ 13.0 million was capitalized to Developed Technology and is being amortized over a period of 5.4 years. Intangible assets as of December 31, 2019 included the following: December 31, 2019 (In thousands) Weighted Average Amortization Period (in years) Gross Carrying Amount Accumulated Amortization Intangible Assets, net Supplier network 10.0 $ 4,000 $ ( 2,067 ) $ 1,933 Customer relationships & other intangibles 7.0 46,766 ( 24,264 ) 22,502 Developed technology 8.6 57,577 ( 10,189 ) 47,388 Patents 16.0 8,662 ( 1,673 ) 6,989 Total intangible assets $ 117,005 $ ( 38,193 ) $ 78,812 |
Summary of Goodwill | (In thousands) December 31, 2018 $ 123,734 Additions and adjustments 4,817 Foreign exchange 224 December 31, 2019 128,775 Additions and adjustments 26,043 Foreign exchange 1,898 December 31, 2020 $ 156,716 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The following table summarizes amortization of intangible assets for future periods as of December 31, 2020: (In thousands) Annual Amortization Year ending December 31: 2021 $ 18,858 2022 18,201 2023 15,983 2024 12,829 2025 8,801 Thereafter 12,277 Total $ 86,949 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
ACCRUED EXPENSES [Abstract] | |
Schedule of Accrued Expenses | December 31, (In thousands) 2020 2019 Compensation and other employee-related costs $ 44,948 $ 37,178 Legal and other settlements and expenses 650 1,538 Accrued non-income taxes 4,952 4,996 Royalties 3,720 2,370 Other 24,064 17,201 Total accrued expenses $ 78,334 $ 63,283 |
EQUITY (Tables)
EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
EQUITY [Abstract] | |
Schedule of Shares Repurchased | Period Total number of shares repurchased Average Price Paid per Share Dollar amount of shares repurchased (1) Approximate dollar value of shares that may yet be purchased under the plan January 1, 2020 - March 31, 2020 1,920 $ 38.49 $ 73,902 $ 126,098 April 1, 2020 - June 30, 2020 771 39.95 30,804 95,294 July 1, 2020 - September 30,2020 — — — 95,294 October 1, 2020 – December 31, 2020 — — — 95,294 January 1, 2020 – December 31, 2020 2,691 $ 38.91 $ 104,706 |
Accumulated Other Comprehensive Income | (In thousands) Unrealized loss on marketable securities, net of tax Foreign currency translation adjustments Accumulated other comprehensive loss Accumulated other comprehensive loss, net of tax, at December 31, 2019 $ 3,599 $ ( 6,497 ) $ ( 2,898 ) Other comprehensive (loss)/income before reclassifications 1,827 5,451 7,278 Amounts reclassified from accumulated other comprehensive income, net of tax ( 425 ) — ( 425 ) Other comprehensive (loss)/income, net of tax 1,402 5,451 6,853 Accumulated other comprehensive loss, net of tax, at December 31, 2020 $ 5,001 $ ( 1,046 ) $ 3,955 (In thousands) Unrealized loss on marketable securities, net of tax Foreign currency translation adjustments Accumulated other comprehensive loss Accumulated other comprehensive loss, net of tax, at December 31, 2018 $ ( 168 ) $ ( 7,004 ) $ ( 7,172 ) Other comprehensive (loss)/income before reclassifications 4,932 507 5,439 Amounts reclassified from accumulated other comprehensive income, net of tax ( 1,165 ) — ( 1,165 ) Other comprehensive (loss)/income, net of tax 3,767 507 4,274 Accumulated other comprehensive loss, net of tax, at December 31, 2019 $ 3,599 $ ( 6,497 ) $ ( 2,898 ) |
Schedule of Computation of Basic and Diluted Earnings | Year Ended December 31, (In thousands, except per share amounts) 2020 2019 2018 Numerator: Net income/(loss) $ 102,285 $ 155,210 $ 156,474 Denominator for basic and diluted net income per share: Weighted average shares outstanding for basic 98,580 99,150 97,884 Dilutive stock options 2,391 2,848 3,432 Weighted average shares outstanding for diluted 100,971 101,998 101,316 Earnings per share: Basic $ 1.04 $ 1.57 $ 1.60 Diluted $ 1.01 $ 1.52 $ 1.54 Anti-dilutive stock options and RSUs excluded from the calculation 5,454 4,494 2,451 |
STOCK-BASED AWARDS (Tables)
STOCK-BASED AWARDS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
STOCK-BASED AWARDS [Abstract] | |
Summary of Stock Option Activity | Stock option activity during the year ended December 31, 2020 is summarized as follows: Option Shares (thousands) Weighted average exercise price Weighted average remaining contractual life (years) Aggregate intrinsic value (thousands) Outstanding at December 31, 2019 10,650 $ 35.80 Granted 2,411 52.40 Exercised ( 2,581 ) 28.03 Forfeited ( 734 ) 43.78 Outstanding at December 31, 2020 9,746 $ 41.33 7.3 $ 232,813 Exercisable at December 31, 2020 4,574 $ 33.72 6.1 $ 144,050 Expected to vest at December 31, 2020 5,172 $ 48.06 8.3 $ 88,763 |
Fair Value of Options Using Black Scholes Option Pricing Model | The fair value of the options was estimated on the date of the grant using a Black-Scholes option pricing model with the following assumptions: Year Ended December 31, 2020 2019 2018 Risk-free interest rate 0.23 % - 1.67 % 1.35 % - 2.57 % 2.30 % - 3.09 % Expected term (years) 4.9 5.0 5.8 - 7.5 Expected volatility 28.0 % - 37.0 % 29.0 % 23.0 % - 28.0 % Expected dividend yield —% —% —% |
Summary of Restricted Stock Unit Activity | Restricted Stock Units (thousands) Weighted average grant date fair value per share Weighted average remaining contractual life (years) Outstanding at December 31, 2019 — $ — Granted 3 58.69 Exercised — — Forfeited — — Expected to vest at December 31, 2020 3 $ 58.69 10 |
Stock-based Compensation Schedule | Year Ended December 31, (In thousands) 2020 2019 2018 Stock-based compensation expense $ 27,073 $ 26,085 $ 21,899 Net stock-based compensation capitalized into inventory 257 331 320 Total stock-based compensation cost $ 27,330 $ 26,416 $ 22,219 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES [Abstract] | |
Schedule of Components of Income Before Income Taxes | The components of income before income taxes are as follows: Year Ended December 31, (In thousands) 2020 2019 2018 Domestic $ 154,356 $ 179,194 $ 180,701 Foreign ( 28,457 ) 10,752 7,904 Total $ 125,899 $ 189,946 $ 188,605 |
Schedule of Components of the Provision for Income Taxes | The components of the provision for income taxes are as follows: Year Ended December 31, (In thousands) 2020 2019 2018 Current: Federal $ 22,183 $ 23,093 $ 23,774 State 4,381 4,532 4,662 Foreign 991 2,819 2,724 27,555 30,444 31,160 Deferred: Federal ( 3,293 ) 6,542 4,155 State ( 678 ) ( 68 ) ( 587 ) Foreign 30 ( 2,182 ) ( 2,597 ) ( 3,941 ) 4,292 971 Total $ 23,614 $ 34,736 $ 32,131 |
Reconciliation of Statutory U.S. Federal Tax Rate to Effective Rate | A reconciliation of the statutory U.S. federal tax rate to our effective rate is as follows: Year Ended December 31, 2020 2019 2018 Statutory U.S. federal tax rate 21.0 % 21.0 % 21.0 % State income taxes, net of federal benefit 3.5 2.2 2.3 Foreign taxes 0.6 0.3 1.2 Valuation allowance 1.7 0.1 0.5 Domestic production activities deduction ( 0.3 ) ( 0.6 ) ( 0.7 ) Tax credits ( 2.6 ) ( 2.6 ) ( 1.6 ) Stock-based compensation windfall ( 9.5 ) ( 2.5 ) ( 5.2 ) Nondeductible expenses 0.5 0.3 ( 0.6 ) Other — 0.1 0.1 IPR&D 3.9 — — Effective tax rate 18.8 % 18.3 % 17.0 % |
Schedule of Significant Components of Deferred Income Taxes | Deferred income taxes reflect the tax effects of temporary differences between the basis of assets and liabilities recognized for financial reporting purposes and tax purposes. Significant components of our deferred income taxes are as follows: December 31, (In thousands) 2020 2019 Deferred tax assets: Inventory reserve $ 28,973 $ 26,381 Accruals, reserves, and other currently not deductible 12,537 8,620 Stock-based compensation 14,297 14,020 Net operating loss carryforwards 4,269 3,857 Total deferred tax assets 60,076 52,878 Valuation allowance ( 6,487 ) ( 2,846 ) Total deferred tax assets, net of valuation allowance 53,589 50,032 Deferred tax liabilities: Depreciation and amortization ( 53,176 ) ( 50,129 ) Total deferred tax liabilities ( 53,176 ) ( 50,129 ) Net deferred tax assets/(liabilities) $ 413 $ ( 97 ) |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: Year Ended December 31, (In thousands) 2020 2019 2018 Unrecognized tax benefits at the beginning of the year $ 2,399 $ 4,777 $ 2,601 Additions related to prior year tax positions — — 2,176 Reductions related to prior year tax positions ( 799 ) ( 2,378 ) — Unrecognized tax benefits at the end of the year $ 1,600 $ 2,399 $ 4,777 |
Impact Of Unrecognized Tax Benefits To Effective Income Tax Rate | The impact of our unrecognized tax benefits to the effective income tax rate is as follows: December 31, (In thousands) 2020 2019 2018 Portion of total unrecognized tax benefits that, if recognized, would affect the effective income tax rate $ 2,032 $ 2,878 $ 4,084 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LEASES [Abstract] | |
Schedule of Supplemental Balance Sheet Information Related to Leases | Amounts reported in the consolidated balance sheet as of the years ended December 31, 2020 and 2019, respectively are as follows: December 31, (In thousands, except weighted average lease term and discount rate) 2020 2019 Operating lease right of use asset $ 4,741 $ 2,481 Lease liability - current 1,865 1,339 Lease liability - long-term 2,936 1,142 Total operating lease liability $ 4,801 $ 2,481 Operating lease expense $ 3,579 $ 3,174 Supplemental non-cash information: Weighted-average remaining lease term (years) - operating leases 2.9 2.6 Weighted-average discount rate - operating leases 3.0 % 3.4 % |
Future Minimum Lease Payments | The following table summarized the future minimum lease payments under non-cancellable leases as of December 31, 2020: (In thousands) Operating Leases 2021 $ 1,987 2022 1,535 2023 815 2024 565 2025 159 Thereafter — Total undiscounted operating lease payments $ 5,061 Less: imputed interest 260 Total operating lease liability $ 4,801 |
RETIREMENT BENEFIT PLANS (Table
RETIREMENT BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
RETIREMENT BENEFIT PLANS [Abstract] | |
Contributions To Retirement Plans | Year Ended December 31, (In thousands) 2020 2019 2018 401(k) and other retirement plan contributions $ 5,798 $ 5,363 $ 4,682 |
SEGMENT AND GEOGRAPHIC INFORM_2
SEGMENT AND GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SEGMENT AND GEOGRAPHIC INFORMATION [Abstract] | |
Schedule of Total Sales by Geographical Area | The following table represents total net sales by geographic area, based on the location of the customer for the years ended December 31, 2020, 2019 and 2018, respectively: Year Ended December 31, (In thousands) 2020 2019 2018 United States $ 664,454 $ 647,683 $ 593,878 International 124,588 137,685 119,091 Total net sales $ 789,042 $ 785,368 $ 712,969 |
QUARTERLY FINANCIAL DATA (Table
QUARTERLY FINANCIAL DATA (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
QUARTERLY FINANCIAL DATA [Abstract] | |
Schedule Of Quarterly Financial Data | NOTE 20. QUARTERLY FINANCIAL DATA (unaudited) (unaudited) March 31, June 30, September 30, December 31, (In thousands, except per share amounts) 2020 2020 2020 2020 Net sales $ 190,577 $ 148,922 $ 216,098 $ 233,445 Gross profit 141,713 98,279 159,001 172,586 Net income/(loss) 25,949 ( 20,837 ) 44,216 52,957 Earnings per share - basic 0.26 ( 0.21 ) 0.45 0.54 Earnings per share - diluted 0.25 ( 0.21 ) 0.44 0.52 * amounts might not add due to rounding (unaudited) March 31, June 30, September 30, December 31, (In thousands, except per share amounts) 2019 2019 2019 2019 Net sales $ 182,947 $ 194,539 $ 196,215 $ 211,667 Gross profit 141,109 150,549 150,828 162,907 Net income/(loss) 33,210 38,163 38,307 45,530 Earnings per share - basic 0.34 0.39 0.39 0.46 Earnings per share - diluted 0.33 0.38 0.38 0.44 |
BACKGROUND (Details)
BACKGROUND (Details) | Dec. 31, 2020item |
BACKGROUND [Abstract] | |
Number of products launched | 220 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) | 12 Months Ended | ||||||||||||
Dec. 31, 2020USD ($)item | Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($)item | Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Number of customers that accounted for 10% or more of sales | item | 0 | 0 | 0 | ||||||||||
Goodwill impairment | $ 0 | $ 0 | $ 0 | ||||||||||
Impairment of finite-lived intangible assets | 0 | 0 | 0 | ||||||||||
Impairment of intangible assets | 0 | 0 | 0 | ||||||||||
Impairment of long-lived assets | 0 | 0 | 0 | ||||||||||
Advertising Expense | 600,000 | 1,100,000 | 1,900,000 | ||||||||||
Total equity | (1,506,297,000) | (1,402,452,000) | (1,185,516,000) | $ (1,417,204,000) | $ (1,336,915,000) | $ (1,363,366,000) | $ (1,338,795,000) | $ (1,287,526,000) | $ (1,237,214,000) | $ (1,141,117,000) | $ (1,097,186,000) | $ (1,026,868,000) | $ (967,778,000) |
Cumulative Effect, Period of Adoption, Adjustment [Member] | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Total equity | 468,000 | ||||||||||||
Retained Earnings [Member] | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Total equity | $ (1,045,082,000) | (1,047,931,000) | $ (892,721,000) | $ (992,125,000) | $ (947,909,000) | $ (999,550,000) | $ (1,002,402,000) | $ (964,094,000) | $ (925,930,000) | $ (855,971,000) | $ (820,763,000) | $ (775,785,000) | $ (736,247,000) |
Retained Earnings [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Total equity | $ 468,000 |
ASSET ACQUISITIONS AND BUSINE_2
ASSET ACQUISITIONS AND BUSINESS COMBINATIONS (Details) $ in Thousands | Oct. 01, 2020USD ($)item | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Business Acquisition [Line Items] | |||||||
Contingent consideration liability | $ 37,270 | $ 9,549 | $ 10,118 | ||||
Goodwill | 156,716 | $ 128,775 | $ 123,734 | ||||
Acquired in-process research and development | $ 24,418 | ||||||
Synoste Acquisition [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | $ 25,300 | ||||||
Payments to Acquire Businesses, Gross | 22,800 | ||||||
Business Acquisitions, Contractual Holdback Obligation Payable Period | 18 months | ||||||
Acquired in-process research and development | 24,400 | ||||||
Liabilities incurred from acquisition | 2,500 | ||||||
Synoste Acquisition [Member] | Third Anniversary [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration liability | 8,000 | ||||||
Synoste Acquisition [Member] | Fourth Anniversary [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration liability | $ 4,000 | ||||||
StelKast Acquisition [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Inventory acquired | $ 15,300 | ||||||
Property, plant and equipment acquired | 4,200 | ||||||
Intangible assets acquired | 3,900 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Contingent Liability | 4,300 | ||||||
Payments to Acquire Businesses, Gross | 23,800 | ||||||
Goodwill, Acquired During Period | 4,700 | ||||||
Business combination, consideration transferred | $ 28,100 | ||||||
Contingent consideration payment | $ 5,000 | ||||||
StelKast Acquisition [Member] | Financing Activity [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration payment | $ 4,300 | ||||||
StelKast Acquisition [Member] | Operating Activity [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration payment | $ 700 | ||||||
Two Acquisitions [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Number of acquisitions | item | 2 | ||||||
Business combination, performance obligation period | 10 years | ||||||
Intangible assets acquired | $ 8,800 | ||||||
Weighted average useful life | 4 years 2 months 12 days | ||||||
Business combination, consideration transferred | 1,500 | ||||||
Contingent consideration liability | 33,200 | ||||||
Goodwill | 26,200 | ||||||
Liabilities incurred from acquisition | $ 300 |
NET SALES (Details)
NET SALES (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 233,445 | $ 216,098 | $ 148,922 | $ 190,577 | $ 211,667 | $ 196,215 | $ 194,539 | $ 182,947 | $ 789,042 | $ 785,368 | $ 712,969 |
Musculoskeletal Solutions [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 748,446 | 738,377 | 666,040 | ||||||||
Enabling Technologies [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 40,596 | $ 46,991 | $ 46,929 |
NOTE RECEIVABLE (Details)
NOTE RECEIVABLE (Details) - USD ($) $ in Millions | 1 Months Ended | ||
Nov. 30, 2018 | Dec. 31, 2016 | Sep. 30, 2016 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Proceeds from Collection of Notes Receivable | $ 29.3 | ||
Notes Receivable - Initial Loan [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Note Receivable, gross, noncurrent | $ 25 | ||
Notes Receivable - Remaining Amount [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Note Receivable, gross, noncurrent | $ 5 | ||
Interest Rate, First Two Years [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Note receivable, basis spread on variable rate | 8.00% | ||
Interest Rate, After First Two Years [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Note receivable, basis spread on variable rate | 13.00% | ||
Maximum [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Note Receivable, gross, noncurrent | $ 30 | ||
Minimum [Member] | Interest Rate, First Two Years [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Notes receivable, interest rate floor | 9.50% |
MARKETABLE SECURITIES (Narrativ
MARKETABLE SECURITIES (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Debt Securities, Available-for-sale [Line Items] | ||
Payable to brokers | $ 9.3 | $ 10.3 |
Short-term Investments [Member] | Maximum [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Contractual Maturity | 1 year | 1 year |
Long-term Investments [Member] | Minimum [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Contractual Maturity | 1 year | 1 year |
Long-term Investments [Member] | Maximum [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Contractual Maturity | 3 years | 3 years |
MARKETABLE SECURITIES (Composit
MARKETABLE SECURITIES (Composition of Marketable Securities) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Municipal Bonds [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | $ 110,612 | $ 53,118 |
Corporate Debt Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 260,334 | 258,264 |
Commercial Paper [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 25,547 | 34,752 |
Asset-backed Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 141,426 | 166,711 |
Government, Federal Agency, And Other Sovereign Obligations [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 7,947 | 12,432 |
Short-term Investments [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 186,282 | 115,486 |
Gross Unrealized Gains | 1,066 | 282 |
Gross Unrealized Loss | (4) | (5) |
Fair Value | 187,344 | 115,763 |
Short-term Investments [Member] | Municipal Bonds [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 39,684 | 7,840 |
Gross Unrealized Gains | 140 | 23 |
Gross Unrealized Loss | (1) | |
Fair Value | 39,824 | 7,862 |
Short-term Investments [Member] | Corporate Debt Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 97,937 | 69,091 |
Gross Unrealized Gains | 817 | 247 |
Gross Unrealized Loss | (4) | (3) |
Fair Value | 98,750 | 69,335 |
Short-term Investments [Member] | Commercial Paper [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 25,543 | 34,747 |
Gross Unrealized Gains | 4 | 6 |
Gross Unrealized Loss | (1) | |
Fair Value | 25,547 | 34,752 |
Short-term Investments [Member] | Asset-backed Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 15,232 | 3,808 |
Gross Unrealized Gains | 44 | 6 |
Fair Value | 15,276 | 3,814 |
Short-term Investments [Member] | Government, Federal Agency, And Other Sovereign Obligations [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 7,886 | |
Gross Unrealized Gains | 61 | |
Fair Value | 7,947 | |
Long-term Investments [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 353,046 | 405,079 |
Gross Unrealized Gains | 5,479 | 4,481 |
Gross Unrealized Loss | (3) | (46) |
Fair Value | 358,522 | 409,514 |
Long-term Investments [Member] | Municipal Bonds [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 70,176 | 45,010 |
Gross Unrealized Gains | 612 | 254 |
Gross Unrealized Loss | (8) | |
Fair Value | 70,788 | 45,256 |
Long-term Investments [Member] | Corporate Debt Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 158,464 | 186,356 |
Gross Unrealized Gains | 3,120 | 2,578 |
Gross Unrealized Loss | (5) | |
Fair Value | 161,584 | 188,929 |
Long-term Investments [Member] | Asset-backed Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 124,406 | 161,347 |
Gross Unrealized Gains | 1,747 | 1,583 |
Gross Unrealized Loss | (3) | (33) |
Fair Value | $ 126,150 | 162,897 |
Long-term Investments [Member] | Government, Federal Agency, And Other Sovereign Obligations [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 12,366 | |
Gross Unrealized Gains | 66 | |
Fair Value | $ 12,432 |
FAIR VALUE MEASUREMENTS (Fair V
FAIR VALUE MEASUREMENTS (Fair Value of Assets and Liabilities Measured on Recurring Basis) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | $ 56,223 | $ 18,218 | |
Business acquisition liabilities | 37,270 | 9,549 | $ 10,118 |
Municipal Bonds [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 110,612 | 53,118 | |
Corporate Debt Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 260,334 | 258,264 | |
Commercial Paper [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 25,547 | 34,752 | |
Asset-backed Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 141,426 | 166,711 | |
Government, Federal Agency, And Other Sovereign Obligations [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 7,947 | 12,432 | |
Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | 23,628 | 4,988 | |
Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | 32,595 | 13,230 | |
Fair Value, Inputs, Level 2 [Member] | Municipal Bonds [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 110,612 | 53,118 | |
Fair Value, Inputs, Level 2 [Member] | Corporate Debt Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 260,334 | 258,264 | |
Fair Value, Inputs, Level 2 [Member] | Commercial Paper [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 25,547 | 34,752 | |
Fair Value, Inputs, Level 2 [Member] | Asset-backed Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 141,426 | 166,711 | |
Fair Value, Inputs, Level 2 [Member] | Government, Federal Agency, And Other Sovereign Obligations [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities | 7,947 | 12,432 | |
Fair Value, Inputs, Level 3 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Business acquisition liabilities | $ 37,270 | $ 9,549 |
FAIR VALUE MEASUREMENTS (Recurr
FAIR VALUE MEASUREMENTS (Recurring Level 3 Fair Value Measurements) (Details) | 12 Months Ended | |
Dec. 31, 2020item | ||
Maximum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Projected year of payment | 2030 | |
Minimum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Projected year of payment | 2021 | |
Weighted Average [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Projected year of payment | 2030 | [1] |
Market Risk Adjustment [Member] | Maximum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, measurement input | 4.3 | |
Market Risk Adjustment [Member] | Minimum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, measurement input | 3.1 | |
Market Risk Adjustment [Member] | Weighted Average [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, measurement input | 3.3 | [1] |
Discount Rate [Member] | Maximum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, measurement input | 8.5 | |
Discount Rate [Member] | Minimum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, measurement input | 0.7 | |
Discount Rate [Member] | Weighted Average [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, measurement input | 5.1 | [1] |
Probability Of Payment [Member] | Maximum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, measurement input | 100 | |
Probability Of Payment [Member] | Minimum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, measurement input | 36 | |
Probability Of Payment [Member] | Weighted Average [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, measurement input | 87.4 | [1] |
[1] | The weighted average rates were calculated based on the relative fair value of each business acquisition liability. |
FAIR VALUE MEASUREMENTS (Rollfo
FAIR VALUE MEASUREMENTS (Rollforward of Contingent Consideration) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, beginning balance | $ 9,549 | $ 10,118 |
Purchase price contingent consideration | 33,219 | 4,299 |
Changes resulting from foreign currency fluctuations | (58) | |
Contingent payments | (6,971) | (6,597) |
Contractual RSU grants | (191) | |
Changes in fair value of business acquisition liabilities | 2,674 | 1,787 |
Contractual payable reclassification | (1,010) | |
Business acquisition liabilities, ending balance | 37,270 | 9,549 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business acquisition liabilities, beginning balance | 9,549 | |
Business acquisition liabilities, ending balance | $ 37,270 | $ 9,549 |
INVENTORIES (Narrative) (Detail
INVENTORIES (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INVENTORIES [Abstract] | |||
Net adjustment to cost of sales related to excess and obsolete inventory | $ 17.7 | $ 2.5 | $ 10.5 |
Excess and obsolete related provisions | 27.4 | 11.2 | 17.6 |
Inventory sales and disposals related provisions | $ 9.7 | $ 8.7 | $ 7.1 |
INVENTORIES (Schedule of Invent
INVENTORIES (Schedule of Inventory) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
INVENTORIES [Abstract] | ||
Raw materials | $ 39,646 | $ 33,025 |
Work in process | 16,446 | 15,940 |
Finished goods | 173,061 | 147,349 |
Total inventories | $ 229,153 | $ 196,314 |
PROPERTY AND EQUIPMENT (Narrati
PROPERTY AND EQUIPMENT (Narrative) (Details) $ in Millions | 1 Months Ended |
Jun. 30, 2018USD ($) | |
PROPERTY AND EQUIPMENT [Abstract] | |
Proceeds from assets sold | $ 5 |
Gain on sale of assets | $ 4.6 |
PROPERTY AND EQUIPMENT (Schedul
PROPERTY AND EQUIPMENT (Schedule of Property and Equipment) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 493,330 | $ 443,573 |
Less: accumulated depreciation | (276,451) | (243,732) |
Total | 216,879 | 199,841 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 8,322 | 8,290 |
Building and Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 33,825 | 33,242 |
Useful Life | 31 years 6 months | |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 102,553 | 97,829 |
Instruments [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 278,930 | 253,929 |
Useful Life | 5 years | |
Modules and cases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 41,919 | 38,293 |
Useful Life | 5 years | |
Other Property and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 27,781 | $ 11,990 |
Maximum [Member] | Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 15 years | |
Maximum [Member] | Other Property and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 5 years | |
Minimum [Member] | Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 5 years | |
Minimum [Member] | Other Property and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life | 3 years |
PROPERTY AND EQUIPMENT (Sched_2
PROPERTY AND EQUIPMENT (Schedule of Depreciation Related to Property and Equipment) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
PROPERTY AND EQUIPMENT [Abstract] | |||
Depreciation | $ 46,043 | $ 38,924 | $ 32,042 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS (Narrative) (Details) - Developed Technology [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||
Weighted average amortization period | 8 years | 8 years 7 months 6 days | |
Nemaris [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Capitalized amount | $ 13 | ||
Weighted average amortization period | 5 years 4 months 24 days |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS (Summary of Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
GOODWILL AND INTANGIBLE ASSETS [Abstract] | ||
Goodwill, Beginning Balance | $ 128,775 | $ 123,734 |
Additions and adjustments | 26,043 | 4,817 |
Foreign exchange | 1,898 | 224 |
Goodwill, Ending Balance | $ 156,716 | $ 128,775 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS (Summary of Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 143,430 | $ 117,005 |
Accumulated amortization | (56,481) | (38,193) |
Intangible Assets, net | $ 86,949 | $ 78,812 |
Supplier Network [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization period | 10 years | 10 years |
Gross Carrying Amount | $ 4,000 | $ 4,000 |
Accumulated amortization | (2,467) | (2,067) |
Intangible Assets, net | $ 1,533 | $ 1,933 |
Customer Relationships & Other Intangibles [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization period | 6 years 6 months | 7 years |
Gross Carrying Amount | $ 57,704 | $ 46,766 |
Accumulated amortization | (32,056) | (24,264) |
Intangible Assets, net | $ 25,648 | $ 22,502 |
Developed Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization period | 8 years | 8 years 7 months 6 days |
Gross Carrying Amount | $ 72,644 | $ 57,577 |
Accumulated amortization | (19,295) | (10,189) |
Intangible Assets, net | $ 53,349 | $ 47,388 |
Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization period | 16 years 1 month 6 days | 16 years |
Gross Carrying Amount | $ 9,082 | $ 8,662 |
Accumulated amortization | (2,663) | (1,673) |
Intangible Assets, net | $ 6,419 | $ 6,989 |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS (Schedule of Finite-Lived Intangible Assets, Future Amortization Expense) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
GOODWILL AND INTANGIBLE ASSETS [Abstract] | ||
Annual Amortization, 2021 | $ 18,858 | |
Annual Amortization, 2022 | 18,201 | |
Annual Amortization, 2023 | 15,983 | |
Annual Amortization, 2024 | 12,829 | |
Annual Amortization, 2025 | 8,801 | |
Annual Amortization, Thereafter | 12,277 | |
Intangible Assets, net | $ 86,949 | $ 78,812 |
ACCRUED EXPENSES (Schedule of A
ACCRUED EXPENSES (Schedule of Accrued Expenses) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
ACCRUED EXPENSES [Abstract] | ||
Compensation and other employee-related costs | $ 44,948 | $ 37,178 |
Legal and other settlements and expenses | 650 | 1,538 |
Accrued non-income taxes | 4,952 | 4,996 |
Royalties | 3,720 | 2,370 |
Other | 24,064 | 17,201 |
Total accrued expenses | $ 78,334 | $ 63,283 |
DEBT (Narrative) (Details)
DEBT (Narrative) (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Aug. 31, 2020 | Dec. 31, 2020 | May 31, 2020 | Jun. 30, 2018 | May 31, 2011 | |
Citizens Bank [Member] | |||||
Debt Instrument [Line Items] | |||||
Credit facility, maximum borrowing capacity | $ 125 | ||||
Line of credit facility, expiration date | Aug. 5, 2021 | ||||
Wells Fargo Bank [Member] | |||||
Debt Instrument [Line Items] | |||||
Credit facility, current borrowing capacity | $ 125 | $ 50 | |||
Credit facility, maximum borrowing capacity | $ 150 | ||||
Federal Funds Effective Rate [Member] | Citizens Bank [Member] | |||||
Debt Instrument [Line Items] | |||||
Credit facility, basis spread on variable rate | 0.50% | ||||
LIBOR [Member] | Citizens Bank [Member] | |||||
Debt Instrument [Line Items] | |||||
Credit facility, basis spread on variable rate | 1.00% | ||||
Letter of Credit [Member] | Citizens Bank [Member] | |||||
Debt Instrument [Line Items] | |||||
Credit facility, maximum borrowing capacity | $ 25 | ||||
Letter of Credit [Member] | Wells Fargo Bank [Member] | |||||
Debt Instrument [Line Items] | |||||
Credit facility, maximum borrowing capacity | $ 25 | $ 25 |
EQUITY (Narrative) (Details)
EQUITY (Narrative) (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2020USD ($)itemshares | Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2019shares | |
Class of Stock [Line Items] | |||||
Stock repurchase plan, authorized amount | $ | $ 200,000 | ||||
Stock repurchase plan, remaining authorized amount | $ | $ 95,294 | $ 95,294 | $ 95,294 | $ 126,098 | |
Common stock, shares authorized | 775,000,000 | ||||
Common Class A [Member] | |||||
Class of Stock [Line Items] | |||||
Common stock, shares authorized | 500,000,000 | 500,000,000 | |||
Number of votes per share | item | 1 | ||||
Shares converted from other class | 1 | ||||
Common Class A And B [Member] | |||||
Class of Stock [Line Items] | |||||
Number of votes per share | item | 1 | ||||
Common Class B [Member] | |||||
Class of Stock [Line Items] | |||||
Common stock, shares authorized | 275,000,000 | 275,000,000 |
EQUITY (Schedule of Shares Repu
EQUITY (Schedule of Shares Repurchased) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2020 | Sep. 30, 2020 | |
EQUITY [Abstract] | ||||
Total number of shares repurchased | 771 | 1,920 | 2,691 | |
Average Price Paid per Share | $ 39.95 | $ 38.49 | $ 38.91 | |
Dollar amount of shares repurchased | $ 30,804 | $ 73,902 | $ 104,706 | |
Approximate dollar value of shares that may yet be purchased under the plan | $ 95,294 | $ 126,098 | $ 95,294 | $ 95,294 |
EQUITY (Accumulated Other Compr
EQUITY (Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Total equity, beginning of period | $ 1,402,452 | $ 1,185,516 | $ 967,778 |
Total other comprehensive income/(loss) | 6,853 | 4,274 | (265) |
Total equity, end of period | 1,506,297 | 1,402,452 | 1,185,516 |
Accumulated Other Comprehensive Income/(Loss) [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Total equity, beginning of period | (2,898) | (7,172) | (6,907) |
Other comprehensive (loss)/income before reclassifications | 7,278 | 5,439 | |
Amounts reclassified from accumulated other comprehensive income, net of tax | (425) | (1,165) | |
Total other comprehensive income/(loss) | 6,853 | 4,274 | |
Total equity, end of period | 3,955 | (2,898) | (7,172) |
Unrealized Gain/(Loss) On Marketable Securities, Net Of Tax [Member] | Accumulated Other Comprehensive Income/(Loss) [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Total equity, beginning of period | 3,599 | (168) | |
Other comprehensive (loss)/income before reclassifications | 1,827 | 4,932 | |
Amounts reclassified from accumulated other comprehensive income, net of tax | (425) | (1,165) | |
Total other comprehensive income/(loss) | 1,402 | 3,767 | |
Total equity, end of period | 5,001 | 3,599 | (168) |
Foreign Currency Translation Adjustments [Member] | Accumulated Other Comprehensive Income/(Loss) [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Total equity, beginning of period | (6,497) | (7,004) | |
Other comprehensive (loss)/income before reclassifications | 5,451 | 507 | |
Total other comprehensive income/(loss) | 5,451 | 507 | |
Total equity, end of period | $ (1,046) | $ (6,497) | $ (7,004) |
EQUITY (Schedule Of Computation
EQUITY (Schedule Of Computation of Basic and Diluted Earnings) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
EQUITY [Abstract] | |||||||||||
Net income/(loss) | $ 52,957 | $ 44,216 | $ (20,837) | $ 25,949 | $ 45,530 | $ 38,307 | $ 38,163 | $ 33,210 | $ 102,285 | $ 155,210 | $ 156,474 |
Weighted average shares outstanding for basic | 98,580 | 99,150 | 97,884 | ||||||||
Dilutive | 2,391 | 2,848 | 3,432 | ||||||||
Weighted average shares outstanding for diluted | 100,971 | 101,998 | 101,316 | ||||||||
Basic | $ 0.54 | $ 0.45 | $ (0.21) | $ 0.26 | $ 0.46 | $ 0.39 | $ 0.39 | $ 0.34 | $ 1.04 | $ 1.57 | $ 1.60 |
Diluted | $ 0.52 | $ 0.44 | $ (0.21) | $ 0.25 | $ 0.44 | $ 0.38 | $ 0.38 | $ 0.33 | $ 1.01 | $ 1.52 | $ 1.54 |
Anti-dilutive stock options and RSUs excluded from the calculation | 5,454 | 4,494 | 2,451 |
STOCK-BASED AWARDS (Narrative)
STOCK-BASED AWARDS (Narrative) (Details) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020USD ($)ShareBasedCompensationPlan$ / sharesshares | Dec. 31, 2019USD ($)$ / shares | Dec. 31, 2018USD ($)$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average period of recognition, unvested stock options | 2 years | ||
Number of stock plans | ShareBasedCompensationPlan | 3 | ||
Base number of shares that may be issuable under stock plan | 3,076,923 | ||
Class A reserved under the 2012 Equity Incentive Plan | 17,899,947 | ||
Class A number of shares available for grant under the 2012 Equity Incentive Plan | 2,109,742 | ||
Intrinsic value of stock options exercised | $ | $ 76.1 | $ 31.3 | $ 59.3 |
Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant | 10,769,230 | ||
Annual percentage limit for incremental shares that may be issued | 3.00% | ||
Stock Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 4 years | ||
Unrecognized compensation expense, unvested stock options | $ | $ 58 | ||
Maximum contractual term | 10 years | ||
Weighted average grant date fair value per share | $ / shares | $ 14.81 | $ 13.76 | $ 14.90 |
STOCK-BASED AWARDS (Summary of
STOCK-BASED AWARDS (Summary of Stock Option Activity) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Number of shares outstanding beginning balance | 10,650 |
Number of shares granted | 2,411 |
Number of shares exercised | (2,581) |
Number of shares forfeited | (734) |
Number of shares outstanding ending balance | 9,746 |
Number of shares exercisable | 4,574 |
Number of shares expected to vest | 5,172 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | |
Weighted average exercise price per share outstanding beginning balance | $ 35.80 |
Weighted average exercise price per share granted | 52.40 |
Weighted average exercise price per share exercised | 28.03 |
Weighted average exercise price per share forfeited | 43.78 |
Weighted average exercise price per share outstanding ending balance | 41.33 |
Weighted average exercise price per share exercisable | 33.72 |
Weighted average exercise price per share expected to vest | $ 48.06 |
Weighted average remaining contractual life outstanding | 7 years 3 months 18 days |
Weighted average remaining contractual life exercisable | 6 years 1 month 6 days |
Weighted average remaining contractual life expected to vest | 8 years 3 months 18 days |
Aggregate intrinsic value outstanding | $ 232,813 |
Aggregate intrinsic value exercisable | 144,050 |
Aggregate intrinsic value expected to vest | $ 88,763 |
STOCK-BASED AWARDS (Fair Value
STOCK-BASED AWARDS (Fair Value of Options Using Black Scholes Option Pricing Model) (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk Free Interest Rate, Minimum | 0.23% | 1.35% | 2.30% |
Risk Free Interest Rate, Maximum | 1.67% | 2.57% | 3.09% |
Expected Volatility Rate, Minimum | 28.00% | 23.00% | |
Expected Volatility Rate, Maximum | 37.00% | 28.00% | |
Expected Volatility | 29.00% | ||
Expected Term | 4 years 10 months 24 days | 5 years | |
Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected Term | 7 years 6 months | ||
Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected Term | 5 years 9 months 18 days |
STOCK-BASED AWARDS (Summary o_2
STOCK-BASED AWARDS (Summary of Restricted Stock Unit Activity) (Details) - Restricted Stock Units (RSUs) [Member] shares in Thousands | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted | shares | 3 |
Expected to vest, end of period | shares | 3 |
Granted, Weighted average grant date fair value per share | $ / shares | $ 58.69 |
Expected to vest, Weighted average grant date fair value per share | $ / shares | $ 58.69 |
Weighted average remaining contractual life (years) | 10 years |
STOCK-BASED AWARDS (Stock-based
STOCK-BASED AWARDS (Stock-based Compensation Schedule) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
STOCK-BASED AWARDS [Abstract] | |||
Stock-based compensation expense | $ 27,073 | $ 26,085 | $ 21,899 |
Net stock-based compensation capitalized into inventory | 257 | 331 | 320 |
Total stock-based compensation cost | $ 27,330 | $ 26,416 | $ 22,219 |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
INCOME TAXES [Abstract] | ||
Deferred tax assets, valuation allowance | $ 6,487 | $ 2,846 |
NOL carryforwards | 26,100 | 21,400 |
Reductions related to prior year tax positions | $ 799 | $ 2,378 |
INCOME TAXES (Schedule of Compo
INCOME TAXES (Schedule of Components of Income Before Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INCOME TAXES [Abstract] | |||
Domestic | $ 154,356 | $ 179,194 | $ 180,701 |
Foreign | (28,457) | 10,752 | 7,904 |
Income/(loss) before income taxes | $ 125,899 | $ 189,946 | $ 188,605 |
INCOME TAXES (Schedule of Com_2
INCOME TAXES (Schedule of Components of the Provision for Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INCOME TAXES [Abstract] | |||
Current: Federal | $ 22,183 | $ 23,093 | $ 23,774 |
Current: State | 4,381 | 4,532 | 4,662 |
Current: Foreign | 991 | 2,819 | 2,724 |
Current: Total | 27,555 | 30,444 | 31,160 |
Deferred: Federal | (3,293) | 6,542 | 4,155 |
Deferred: State | (678) | (68) | (587) |
Deferred: Foreign | 30 | (2,182) | (2,597) |
Deferred: Total | (3,941) | 4,292 | 971 |
Income Tax Expense (Benefit), Total | $ 23,614 | $ 34,736 | $ 32,131 |
INCOME TAXES (Reconciliation of
INCOME TAXES (Reconciliation of Statutory U.S. Federal Tax Rate to Effective Rate) (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INCOME TAXES [Abstract] | |||
Statutory U.S. federal tax rate | 21.00% | 21.00% | 21.00% |
State income taxes, net of federal benefit | 3.50% | 2.20% | 2.30% |
Foreign taxes | 0.60% | 0.30% | 1.20% |
Valuation allowance | 1.70% | 0.10% | 0.50% |
Domestic production activities deduction | (0.30%) | (0.60%) | (0.70%) |
Tax credits | (2.60%) | (2.60%) | (1.60%) |
Stock-based compensation windfall | (9.50%) | (2.50%) | (5.20%) |
Nondeductible expenses | 0.50% | 0.30% | (0.60%) |
Other | 0.10% | 0.10% | |
IPR&D | 3.90% | ||
Effective tax rate | 18.80% | 18.30% | 17.00% |
INCOME TAXES (Schedule of Signi
INCOME TAXES (Schedule of Significant Components of Deferred Income Taxes) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
INCOME TAXES [Abstract] | ||
Inventory reserve | $ 28,973 | $ 26,381 |
Accruals, reserves, and other currently not deductible | 12,537 | 8,620 |
Stock-based compensation | 14,297 | 14,020 |
Net operating loss carryforwards | 4,269 | 3,857 |
Total deferred tax assets | 60,076 | 52,878 |
Valuation allowance | (6,487) | (2,846) |
Total deferred tax assets, net of valuation allowance | 53,589 | 50,032 |
Depreciation and amortization | (53,176) | (50,129) |
Total deferred tax liabilities | (53,176) | (50,129) |
Net deferred tax assets | $ 413 | |
Net deferred tax liabilities | $ (97) |
INCOME TAXES (Reconciliation _2
INCOME TAXES (Reconciliation of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INCOME TAXES [Abstract] | |||
Unrecognized tax benefits at the beginning of the year | $ 2,399 | $ 4,777 | $ 2,601 |
Additions related to prior year tax positions | 2,176 | ||
Reductions related to prior year tax positions | (799) | (2,378) | |
Unrecognized tax benefits at the end of the year | $ 1,600 | $ 2,399 | $ 4,777 |
INCOME TAXES (Impact Of Unrecog
INCOME TAXES (Impact Of Unrecognized Tax Benefits To Effective Income Tax Rate) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
INCOME TAXES [Abstract] | |||
Portion of total unrecognized tax benefits that, if recognized, would affect the effective income tax rate | $ 2,032 | $ 2,878 | $ 4,084 |
LEASES (Narrative) (Details)
LEASES (Narrative) (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Maximum [Member] | |
Lessee, Lease, Description [Line Items] | |
Lease term (in months) | 14 years |
Lease term that are not recognized as right of use assets or lease liabilities | 12 months |
Minimum [Member] | |
Lessee, Lease, Description [Line Items] | |
Lease term (in months) | 1 year |
LEASES (Schedule of Supplementa
LEASES (Schedule of Supplemental Balance Sheet Information Related to Leases) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
LEASES [Abstract] | ||
Operating lease right of use assets | $ 4,741 | $ 2,481 |
Lease liability - current | 1,865 | 1,339 |
Lease liability - long term | 2,936 | 1,142 |
Total operating lease liability | 4,801 | 2,481 |
Operating lease expense | $ 3,579 | $ 3,174 |
Weighted-average remaining lease term (years) - operating leases | 2 years 10 months 24 days | 2 years 7 months 6 days |
Weighted-average discount rate - operating leases | 3.00% | 3.40% |
LEASES (Future Minimum Lease Pa
LEASES (Future Minimum Lease Payments) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
LEASES [Abstract] | ||
Year one | $ 1,987 | |
Year two | 1,535 | |
Year three | 815 | |
Year four | 565 | |
Year five | 159 | |
Total undiscounted operating lease payments | 5,061 | |
Less : imputed interest | 260 | |
Total lease liabilities | $ 4,801 | $ 2,481 |
RETIREMENT BENEFIT PLANS (Narra
RETIREMENT BENEFIT PLANS (Narrative) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
RETIREMENT BENEFIT PLANS [Abstract] | |
Nondiscretionary employee contribution match rate | 100.00% |
Maximum annual contribution match, per employee | $ 6 |
Maximum annual contribution match, percent per employee | 3.00% |
RETIREMENT BENEFIT PLANS (Contr
RETIREMENT BENEFIT PLANS (Contributions To Retirement Plans) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
RETIREMENT BENEFIT PLANS [Abstract] | |||
401(k) and other retirement plan contributions | $ 5,798 | $ 5,363 | $ 4,682 |
SEGMENT AND GEOGRAPHIC INFORM_3
SEGMENT AND GEOGRAPHIC INFORMATION (Schedule of Total Sales by Geographical Area) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | $ 233,445 | $ 216,098 | $ 148,922 | $ 190,577 | $ 211,667 | $ 196,215 | $ 194,539 | $ 182,947 | $ 789,042 | $ 785,368 | $ 712,969 |
United States [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | 664,454 | 647,683 | 593,878 | ||||||||
International [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | $ 124,588 | $ 137,685 | $ 119,091 |
QUARTERLY FINANCIAL DATA (Sched
QUARTERLY FINANCIAL DATA (Schedule Of Quarterly Financial Data) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
QUARTERLY FINANCIAL DATA [Abstract] | |||||||||||
Net sales | $ 233,445 | $ 216,098 | $ 148,922 | $ 190,577 | $ 211,667 | $ 196,215 | $ 194,539 | $ 182,947 | $ 789,042 | $ 785,368 | $ 712,969 |
Gross Profit | 172,586 | 159,001 | 98,279 | 141,713 | 162,907 | 150,828 | 150,549 | 141,109 | 571,579 | 605,393 | 553,559 |
Net income/(loss) | $ 52,957 | $ 44,216 | $ (20,837) | $ 25,949 | $ 45,530 | $ 38,307 | $ 38,163 | $ 33,210 | $ 102,285 | $ 155,210 | $ 156,474 |
Earnings per share - basic | $ 0.54 | $ 0.45 | $ (0.21) | $ 0.26 | $ 0.46 | $ 0.39 | $ 0.39 | $ 0.34 | $ 1.04 | $ 1.57 | $ 1.60 |
Earnings per share - diluted | $ 0.52 | $ 0.44 | $ (0.21) | $ 0.25 | $ 0.44 | $ 0.38 | $ 0.38 | $ 0.33 | $ 1.01 | $ 1.52 | $ 1.54 |
SCHEDULE II VALUATION ACCOUNT_2
SCHEDULE II VALUATION ACCOUNTS AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
SEC Schedule, 12-09, Allowance, Credit Loss [Member] | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning of period | $ 5,599 | $ 4,226 | $ 3,963 |
Charged to expenses | 2,960 | 3,026 | 960 |
Write-offs/Deductions | (4,151) | (1,653) | (697) |
End of period | 4,408 | 5,599 | 4,226 |
SEC Schedule, 12-09, Valuation Allowance, Deferred Tax Asset [Member] | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning of period | 2,846 | 2,683 | 1,821 |
Charged to expenses | 2,132 | 163 | 924 |
Charged to other accounts | 1,509 | ||
Write-offs/Deductions | (62) | ||
End of period | $ 6,487 | $ 2,846 | $ 2,683 |