Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2012 | Mar. 14, 2014 | Jun. 30, 2012 |
Document And Entity Information [Abstract] | ' | ' | ' |
Document Type | '10-K/A | ' | ' |
Amendment Flag | 'true | ' | ' |
Amendment Description | 'Orthofix International N.V. (together with its respective consolidated subsidiaries and affiliates, the “Company,†sometimes referred to as “weâ€, “us†or “ourâ€) is filing this amendment (this “Amendment†or “Form 10-K/Aâ€) to its Annual Report on Form 10-K for the year ended December 31, 2012, originally filed on March 1, 2013 (the “Original Form 10-Kâ€) to reflect the restatement of its consolidated financial statements as of and for each of the years ended December 31, 2012 and December 31, 2011, and related disclosures described below. The restatement of the Original Form 10-K reflected in this Amendment corrects errors principally related to our accounting for revenue recognition for sales to distributors, our accounting for inventory reserves, and our accounting for royalties. Concurrently with the filing of this Amendment, we are also filing an amendment to our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2013 (the “2013 First Quarter 10-Q Amendmentâ€) to reflect the restatement of our consolidated financial statements as of and for the fiscal quarter ended March 31, 2013, which reflects the correction of the same types of errors with respect to such period. This Amendment also includes restated unaudited quarterly financial information for each of the years ended December 31, 2012 and 2011 and amends certain other information in the Original Form 10-K as listed in “Items Amended by this Filing†below, as a result of the restatement of our financial statements. | ' | ' |
Document Period End Date | 31-Dec-12 | ' | ' |
Document Fiscal Year Focus | '2012 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Trading Symbol | 'OFIX | ' | ' |
Entity Registrant Name | 'ORTHOFIX INTERNATIONAL N V | ' | ' |
Entity Central Index Key | '0000884624 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Current Reporting Status | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Filer Category | 'Large Accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 18,187,194 | ' |
Entity Public Float | ' | ' | $781.50 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 |
In Thousands, unless otherwise specified | ||||||||||
Current assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | $31,055 | ' | ' | ' | $33,207 | ' | ' | ' | $13,561 | $13,328 |
Restricted cash | 21,314 | ' | ' | ' | 45,476 | ' | ' | ' | ' | ' |
Trade accounts receivable, less allowances of $13,543 and $9,341 at December 31, 2012 and 2011, respectively | 107,312 | ' | ' | ' | 99,888 | ' | ' | ' | ' | ' |
Inventories | 83,373 | ' | ' | ' | 81,528 | ' | ' | ' | ' | ' |
Deferred income taxes | 33,450 | ' | ' | ' | 36,313 | ' | ' | ' | ' | ' |
Escrow receivable | ' | ' | ' | ' | 41,537 | ' | ' | ' | ' | ' |
Prepaid expenses and other current assets | 34,079 | ' | ' | ' | 21,999 | ' | ' | ' | ' | ' |
Assets held for sale | ' | ' | ' | ' | 171,185 | ' | ' | ' | ' | ' |
Total current assets | 310,583 | ' | ' | ' | 531,133 | ' | ' | ' | ' | ' |
Property, plant and equipment, net | 53,835 | ' | ' | ' | 46,137 | ' | ' | ' | ' | ' |
Patents and other intangible assets, net | 7,290 | ' | ' | ' | 8,846 | ' | ' | ' | ' | ' |
Goodwill | 74,388 | ' | ' | ' | 73,094 | ' | ' | ' | 73,598 | ' |
Deferred income taxes | 18,881 | ' | ' | ' | 16,741 | ' | ' | ' | ' | ' |
Other long-term assets | 7,920 | ' | ' | ' | 9,429 | ' | ' | ' | ' | ' |
Total assets | 472,897 | 539,566 | 530,395 | 694,106 | 685,380 | 639,868 | 632,860 | 618,938 | ' | ' |
Current liabilities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Bank borrowings | 16 | ' | ' | ' | 1,318 | ' | ' | ' | ' | ' |
Current portion of long-term debt | ' | ' | ' | ' | 17,500 | ' | ' | ' | ' | ' |
Trade accounts payable | 22,575 | ' | ' | ' | 18,231 | ' | ' | ' | ' | ' |
Accrued charges related to U.S. Government resolutions | ' | ' | ' | ' | 83,138 | ' | ' | ' | ' | ' |
Other current liabilities | 39,594 | ' | ' | ' | 40,836 | ' | ' | ' | ' | ' |
Liabilities held for sale | ' | ' | ' | ' | 22,676 | ' | ' | ' | ' | ' |
Total current liabilities | 62,185 | ' | ' | ' | 183,699 | ' | ' | ' | ' | ' |
Long-term debt | 20,000 | ' | ' | ' | 191,195 | ' | ' | ' | ' | ' |
Deferred income taxes | 11,456 | ' | ' | ' | 9,778 | ' | ' | ' | ' | ' |
Other long-term liabilities | 11,424 | ' | ' | ' | 8,634 | ' | ' | ' | ' | ' |
Total liabilities | 105,065 | 193,599 | 205,196 | 381,734 | 393,306 | 347,777 | 352,884 | 354,949 | ' | ' |
Contingencies (Note 17) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shareholders' equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common shares $0.10 par value; 50,000,000 shares authorized; 19,339,329 and 18,465,444 issued and outstanding as of December 31, 2012 and 2011, respectively | 1,934 | ' | ' | ' | 1,846 | ' | ' | ' | ' | ' |
Additional paid-in capital | 246,306 | ' | ' | ' | 214,505 | ' | ' | ' | ' | ' |
Retained earnings | 114,847 | ' | ' | ' | 72,009 | ' | ' | ' | ' | ' |
Accumulated other comprehensive income | 4,745 | ' | ' | ' | 3,714 | ' | ' | ' | ' | ' |
Total shareholders' equity | 367,832 | 345,967 | 325,199 | 312,372 | 292,074 | 292,091 | 279,976 | 263,989 | ' | ' |
Total liabilities and shareholder's equity | $472,897 | $539,566 | $530,395 | $694,106 | $685,380 | $639,868 | $632,860 | $618,938 | ' | ' |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, except Share data, unless otherwise specified | ||
Statement Of Financial Position [Abstract] | ' | ' |
Trade accounts receivable, allowances | $13,543 | $9,341 |
Common shares, par value | $0.10 | $0.10 |
Common shares, authorized | 50,000,000 | 50,000,000 |
Common shares, issued | 19,339,329 | 18,465,444 |
Common shares, outstanding | 19,339,329 | 18,465,444 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Income (Loss) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Income Statement [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product sales | ' | ' | ' | ' | ' | ' | ' | ' | $401,039 | $405,147 | $432,845 |
Marketing service fees | ' | ' | ' | ' | ' | ' | ' | ' | 46,542 | 36,824 | 29,726 |
Net sales | 117,365 | 107,857 | 113,423 | 108,936 | 118,639 | 111,510 | 108,216 | 103,606 | 447,581 | 441,971 | 462,571 |
Cost of sales | 24,944 | 24,384 | 27,547 | 21,378 | 27,300 | 23,126 | 22,755 | 22,346 | 98,253 | 95,527 | 97,093 |
Gross profit | 92,421 | 83,473 | 85,876 | 87,558 | 91,339 | 88,384 | 85,461 | 81,260 | 349,328 | 346,444 | 365,478 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | 187,131 | 193,511 | 196,113 |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | 53,391 | 64,481 | 73,010 |
Research and development | ' | ' | ' | ' | ' | ' | ' | ' | 28,577 | 22,861 | 27,958 |
Amortization of intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | 2,298 | 2,550 | 2,413 |
Charges related to U.S. Government resolutions (Note 17) | ' | ' | ' | ' | ' | ' | ' | ' | 1,295 | 57,141 | ' |
Total operating expenses | 66,808 | 64,668 | 71,578 | 69,638 | 83,165 | 67,417 | 73,102 | 116,860 | 272,692 | 340,544 | 299,494 |
Operating income | 25,613 | 18,805 | 14,298 | 17,920 | 8,174 | 20,967 | 12,359 | -35,600 | 76,636 | 5,900 | 65,984 |
Other income and (expense) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net | ' | ' | ' | ' | ' | ' | ' | ' | -4,743 | -5,541 | -11,287 |
Other income (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -1,705 | -2,412 | 331 |
Total other income (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -6,448 | -7,953 | -10,956 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 70,188 | -2,053 | 55,028 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | -25,138 | -14,165 | -24,031 |
Net income (loss) from continuing operations, net of tax | 16,009 | 10,574 | 9,870 | 8,597 | 7,652 | 11,300 | 6,579 | -41,749 | 45,050 | -16,218 | 30,997 |
Discontinued operations (Note 16) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain on sale of Breg, Inc., net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 1,345 | ' | ' |
Gain on sale of vascular operations, net of tax (Note 22) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,521 |
Income (loss) from discontinued operations | ' | ' | ' | ' | ' | ' | ' | ' | -2,994 | -2,705 | 5,089 |
Income tax benefit (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -563 | 813 | -311 |
Net income (loss) from discontinued operations, net of tax | 5,152 | -5,558 | -2,616 | 810 | 235 | -1,225 | -1,184 | 282 | -2,212 | -1,892 | 13,299 |
Net income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 42,838 | -18,110 | 44,296 |
Net income (loss) per common share-basic: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.83 | $0.55 | $0.52 | $0.46 | $0.42 | $0.61 | $0.36 | ($2.33) | $2.37 | ($0.89) | $1.76 |
Net income (loss) from discontinued operations, net of tax | $0.27 | ($0.29) | ($0.14) | $0.04 | $0.01 | ($0.07) | ($0.07) | $0.02 | ($0.12) | ($0.10) | $0.76 |
Net income (loss) per common share-basic | $1.10 | $0.26 | $0.38 | $0.50 | $0.43 | $0.54 | $0.29 | ($2.31) | $2.25 | ($0.99) | $2.52 |
Net income (loss) per common share-diluted: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.81 | $0.54 | $0.51 | $0.45 | $0.41 | $0.60 | $0.35 | ($2.33) | $2.32 | ($0.89) | $1.73 |
Net income (loss) from discontinued operations, net of tax | $0.26 | ($0.29) | ($0.14) | $0.04 | $0.01 | ($0.06) | ($0.06) | $0.02 | ($0.11) | ($0.10) | $0.74 |
Net income (loss) per common share-diluted: | $1.07 | $0.25 | $0.37 | $0.49 | $0.42 | $0.54 | $0.29 | ($2.31) | $2.21 | ($0.99) | $2.47 |
Weighted average number of common shares: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic | ' | ' | ' | ' | ' | ' | ' | ' | 18,977,263 | 18,219,343 | 17,601,956 |
Diluted | ' | ' | ' | ' | ' | ' | ' | ' | 19,390,413 | 18,219,343 | 17,913,545 |
Other comprehensive income (loss), before tax: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Translation adjustment | ' | ' | ' | ' | ' | ' | ' | ' | 768 | -2,279 | -1,317 |
Unrealized gain (loss) on derivative instrument | ' | ' | ' | ' | ' | ' | ' | ' | 416 | -693 | -126 |
Other comprehensive income (loss), before tax | ' | ' | ' | ' | ' | ' | ' | ' | 1,184 | -2,972 | -1,443 |
Income tax (expense) benefit related to components of other comprehensive income | -153 | ' | ' | ' | 256 | ' | ' | ' | -153 | 256 | 36 |
Other comprehensive income (loss), net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 1,031 | -2,716 | -1,407 |
Comprehensive income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | $43,869 | ($20,826) | $42,889 |
Consolidated_Statements_of_Cha
Consolidated Statements of Changes in Shareholders Equity (USD $) | Total | Common Shares [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
In Thousands, except Share data | |||||
Balance, Amount at Dec. 31, 2009 (Previously Reported [Member]) | $240,269 | $1,714 | $177,246 | $54,119 | $7,190 |
Balance, Shares at Dec. 31, 2009 (Previously Reported [Member]) | ' | 17,141,710 | ' | ' | ' |
Cumulative effect of adjustment on opening balance (Adjustments [Member]) | -7,649 | ' | ' | -8,296 | 647 |
Net income (loss) | 44,296 | ' | ' | 44,296 | ' |
Net income (loss) at Jan. 01, 2010 (Previously Reported [Member]) | 44,208 | ' | ' | ' | ' |
Net income (loss) (Adjustments [Member]) | 88 | ' | ' | ' | ' |
Unrealized gain (loss) on derivative instrument net of taxes | -90 | ' | ' | ' | -90 |
Translation adjustment | -1,317 | ' | ' | ' | -1,317 |
Translation adjustment at Jan. 01, 2010 (Previously Reported [Member]) | -1,710 | ' | ' | ' | ' |
Translation adjustment (Adjustments [Member]) | 393 | ' | ' | ' | ' |
Tax benefit on exercise of stock options | 2,417 | ' | 2,417 | ' | ' |
Share-based compensation expense | 8,138 | ' | 8,138 | ' | ' |
Common shares issued | 7,854 | 58 | 7,796 | ' | ' |
Common shares issued, Shares | ' | 584,935 | ' | ' | ' |
Balance, Amount (Restated) at Dec. 31, 2010 | 293,918 | 1,772 | 195,597 | 90,119 | 6,430 |
Balance, Shares (Restated) at Dec. 31, 2010 | ' | 17,726,645 | ' | ' | ' |
Net income (loss) | -18,110 | ' | ' | -18,110 | ' |
Net income (loss) at Jan. 01, 2011 (Previously Reported [Member]) | -1,073 | ' | ' | ' | ' |
Net income (loss) (Adjustments [Member]) | -17,037 | ' | ' | ' | ' |
Unrealized gain (loss) on derivative instrument net of taxes | -437 | ' | ' | ' | -437 |
Translation adjustment | -2,279 | ' | ' | ' | -2,279 |
Translation adjustment at Jan. 01, 2011 (Previously Reported [Member]) | -3,192 | ' | ' | ' | ' |
Translation adjustment (Adjustments [Member]) | 913 | ' | ' | ' | ' |
Purchase of minority interest | -517 | ' | -517 | ' | ' |
Tax benefit on exercise of stock options | 1,737 | ' | 1,737 | ' | ' |
Reclassification for tax benefit on exercise of stock options | -8,999 | ' | -8,999 | ' | ' |
Share-based compensation expense | 6,648 | ' | 6,648 | ' | ' |
Common shares issued | 20,113 | 74 | 20,039 | ' | ' |
Common shares issued, Shares | ' | 738,799 | ' | ' | ' |
Balance, Amount (Restated) at Dec. 31, 2011 | 292,074 | 1,846 | 214,505 | 72,009 | 3,714 |
Balance, Shares (Restated) at Dec. 31, 2011 (Previously Reported [Member]) | 18,465,444 | ' | ' | ' | ' |
Balance, Shares (Restated) at Dec. 31, 2011 | 18,465,444 | 18,465,444 | ' | ' | ' |
Net income (loss) | 42,838 | ' | ' | 42,838 | ' |
Net income (loss) at Jan. 01, 2012 (Previously Reported [Member]) | 51,295 | ' | ' | ' | ' |
Net income (loss) (Adjustments [Member]) | -8,457 | ' | ' | ' | ' |
Unrealized gain (loss) on derivative instrument net of taxes | 263 | ' | ' | ' | 263 |
Translation adjustment | 768 | ' | ' | ' | 768 |
Translation adjustment at Jan. 01, 2012 (Previously Reported [Member]) | 480 | ' | ' | ' | ' |
Translation adjustment (Adjustments [Member]) | 288 | ' | ' | ' | ' |
Share-based compensation expense | 6,303 | ' | 6,303 | ' | ' |
Common shares issued | 25,586 | 88 | 25,498 | ' | ' |
Common shares issued, Shares | ' | 873,885 | ' | ' | ' |
Balance, Amount (Restated) at Dec. 31, 2012 | $367,832 | $1,934 | $246,306 | $114,847 | $4,745 |
Balance, Shares (Restated) at Dec. 31, 2012 (Previously Reported [Member]) | 19,339,329 | ' | ' | ' | ' |
Balance, Shares (Restated) at Dec. 31, 2012 | 19,339,329 | 19,339,329 | ' | ' | ' |
Consolidated_Statements_of_Cha1
Consolidated Statements of Changes in Shareholders Equity (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Statement Of Stockholders Equity [Abstract] | ' | ' | ' |
Unrealized gain loss on derivative instrument, taxes | $153 | $256 | $36 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Cash flows from operating activities: | ' | ' | ' |
Net income (loss) | $42,838 | ($18,110) | $44,296 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ' | ' | ' |
Depreciation and amortization | 20,580 | 23,017 | 22,087 |
Amortization of debt costs | 1,737 | 1,239 | 471 |
Provision for doubtful accounts | 10,572 | 12,936 | 8,616 |
Deferred income taxes | -1,252 | -52 | 591 |
Share-based compensation | 6,303 | 6,648 | 8,138 |
Loss on refinancing of credit facility | ' | ' | 550 |
Gain on interest rate swap | ' | ' | -1,254 |
Gain on sale of Breg, Inc, net of tax | -1,345 | ' | ' |
Net gain on sale of vascular operations, net of tax | ' | ' | -8,521 |
Excess income tax benefit on employee stock-based awards | -1,020 | -1,737 | -2,417 |
Income tax benefit on employee stock-based awards | 2,910 | ' | ' |
Other | 4,136 | 4,491 | 4,439 |
Changes in operating assets and liabilities, net of effect of dispositions: | ' | ' | ' |
Trade accounts receivable | -18,438 | 293 | -16,645 |
Inventories | -2,495 | -12,624 | 9,767 |
Escrow receivable | 41,537 | -32,562 | -2,049 |
Prepaid expenses and other current assets | -15,577 | 2,829 | -4,378 |
Trade accounts payable | 4,575 | 2,322 | -2,866 |
Charges related to U.S. Government resolutions | -83,178 | 89,101 | ' |
Other current liabilities | -5,729 | 1,419 | -9,695 |
Other long-term assets | 3,416 | -17,307 | -744 |
Other long-term liabilities | 616 | 2,878 | -8,073 |
Net cash provided by operating activities | 10,186 | 64,781 | 42,313 |
Cash flows from investing activities: | ' | ' | ' |
Capital expenditures for property, plant and equipment | -27,994 | -24,965 | -25,844 |
Capital expenditures for intangible assets | -780 | -793 | -517 |
Payment made in connection with acquisition | ' | -5,250 | ' |
Net proceeds from sale of Breg Inc. | 153,773 | ' | ' |
Net proceeds from the sale of vascular operations | ' | ' | 24,215 |
Net cash provided by (used in) investing activities | 124,999 | -31,008 | -2,146 |
Cash flows from financing activities: | ' | ' | ' |
Net proceeds from issuance of common shares | 25,586 | 20,113 | 7,854 |
Payment of refinancing fees and debt issuance costs | ' | -758 | -4,266 |
Repayments of long-term debt | -188,695 | -7,500 | -36,269 |
Proceeds from (repayment of) bank borrowings, net | -1,297 | -2,561 | 1,723 |
Changes in restricted cash | 25,799 | -24,178 | -11,290 |
Cash payment for purchase of minority interest in subsidiary | ' | -517 | ' |
Excess income tax benefit on employee stock-based awards | 1,020 | 1,737 | 2,417 |
Net cash used in financing activities | -137,587 | -13,664 | -39,831 |
Effect of exchange rate changes on cash | 250 | -463 | -103 |
Net increase (decrease) in cash and cash equivalents | -2,152 | 19,646 | 233 |
Cash and cash equivalents at the beginning of the year | 33,207 | 13,561 | 13,328 |
Cash and cash equivalents at the end of the year | 31,055 | 33,207 | 13,561 |
Cash paid during the year for: | ' | ' | ' |
Interest | 4,569 | 17,088 | 16,032 |
Income taxes | $18,268 | $26,227 | $29,743 |
Summary_of_significant_account
Summary of significant accounting policies | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Summary of significant accounting policies | ' | ||||||||||||
1 | Summary of significant accounting policies | ||||||||||||
(a) | Basis of consolidation | ||||||||||||
The consolidated financial statements include the financial statements of the Company and its wholly-owned and majority-owned subsidiaries and entities over which the Company has control. | |||||||||||||
All intercompany accounts, transactions and profits are eliminated in the consolidated financial statements on a continuing operations basis unless otherwise noted. | |||||||||||||
(b) | Use of estimates in preparation of financial statements | ||||||||||||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, we evaluate our estimates, including those related to the recoverability and useful lives of long-lived assets and the adequacy of the allowance for doubtful accounts and inventory obsolescence, and income taxes. We base our estimates on historical experience, future expectations and on other relevant assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. | |||||||||||||
(c) | Foreign currency translation | ||||||||||||
The financial statements for operations outside the United States are generally maintained in their local currency. All foreign currency denominated balance sheet accounts, except shareholders’ equity, are translated to U.S. dollars at year end exchange rates and revenue and expense items are translated at weighted average rates of exchange prevailing during the year. Gains and losses resulting from the translation of foreign currency are recorded in the accumulated other comprehensive income component of shareholders’ equity. Transactional foreign currency gains and (losses), including those generated from intercompany operations, are included in other expense, net and were $0.5 million loss, $1.6 million loss and $0.1 million loss for the years ended December 31, 2012, 2011 and 2010, respectively. | |||||||||||||
(d) | Cash and cash equivalents | ||||||||||||
The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. | |||||||||||||
(e) | Restricted cash | ||||||||||||
Restricted cash consists of cash held at certain subsidiaries, the distribution or transfer of which to Orthofix International N.V. (the “Parent”) or other subsidiaries that are not parties to the credit facility described in Note 9 is restricted. The senior secured credit facility restricts the parent and subsidiaries that are not parties to the facility from access to cash held by Orthofix Holdings, Inc. and its subsidiaries. All credit party subsidiaries have access to this cash for operational and debt repayment purposes. | |||||||||||||
(f) | Market risk | ||||||||||||
In the ordinary course of business, the Company is exposed to the impact of changes in interest rates and foreign currency fluctuations. The Company’s objective is to limit the impact of such movements on earnings and cash flows. In order to achieve this objective, the Company seeks to balance its non-dollar denominated income and expenditures. During 2008, the Company executed an interest rate swap agreement to manage the cash flow exposure generated from interest rate fluctuations. On June 29, 2010, the Company settled the interest rate swap. During 2012, 2011 and 2010, the Company made use of a foreign currency swap agreement to manage cash flow exposure generated from foreign currency fluctuations. See Note 10 for additional information. | |||||||||||||
The Company generally does not require collateral on trade receivables. | |||||||||||||
(g) | Inventories | ||||||||||||
Inventories are valued at the lower of cost or estimated net realizable value, after provision for excess, obsolete or impaired items which is reviewed and updated on a periodic basis by management. For inventory procured or produced, whether internally or through contract manufacturing arrangements, at our manufacturing facility in Italy, cost is determined on a weighted-average basis, which approximates the first-in, first-out (“FIFO”) method, due to the high turn-over rate of inventory at this location. For inventory procured or produced, whether internally or through contract manufacturing arrangements, at our manufacturing facility in Texas, standard costs, which approximates actual cost on a FIFO basis, is used to value inventory. Standard costs are reviewed annually by management, or more often in the event circumstances indicate a change in cost has occurred. The valuation of work-in-process, finished products, field inventory and consignment inventory includes the cost of materials, labor and other production costs. Field inventory represents immediately saleable finished products inventory that is in the possession of the Company’s direct sales representatives. Consignment inventory represents immediately saleable finished products located at third party customers, such as distributors and hospitals. | |||||||||||||
(h) | Long-lived assets, including intangibles and goodwill | ||||||||||||
Property, plant and equipment is stated at cost less accumulated depreciation. Costs include all expenditures necessary to place the asset in service, including freight and sales and use taxes. Plant and equipment also includes instrumentation held by customers and is generally used to facilitate the implantation of the Company’s products. Depreciation is computed on a straight-line basis over the useful lives of the assets. Depreciation of leasehold improvements is computed over the shorter of the lease term or the useful life of the asset. The useful lives are as follows: | |||||||||||||
Years | |||||||||||||
Buildings | 25 to 33 | ||||||||||||
Plant, equipment and instrumentation | 2 to 10 | ||||||||||||
Furniture and fixtures | 4 to 8 | ||||||||||||
Expenditures for maintenance and repairs and minor renewals and improvements, which do not extend the lives of the respective assets, are expensed as incurred. All other expenditures for renewals and improvements are capitalized. The assets and related accumulated depreciation are adjusted for property retirements and disposals, with the resulting gain or loss included in operations. Fully depreciated assets remain in the accounts until retired from service. | |||||||||||||
Patents and other intangible assets are recorded at cost, or when acquired as a part of a business combination at estimated fair value. These assets primarily include patents and other technology agreements (“developed technologies”) and trademarks. Identifiable intangible assets which are considered definite lived are amortized over their useful lives using a method of amortization that reflects the pattern in which the economic benefit of the intangible assets is consumed. The Company’s weighted average amortization period for developed technologies is 11 years. | |||||||||||||
Intangible and long-lived assets with definite lives, such as developed technologies, are tested for impairment if any adverse conditions exist or change in circumstances have occurred that would indicate impairment or a change in the remaining useful life. If an impairment indicator exists, the Company tests the intangible asset for recoverability. For purposes of the recoverability test, the Company groups its intangible assets with other assets and liabilities at the lowest level of identifiable cash flows if the intangible asset does not generate cash flows independent of other assets and liabilities. If the carrying value of the intangible asset (asset group) exceeds the undiscounted cash flows expected to result from the use and eventual disposition of the intangible asset (asset group), the Company will write the carrying value down to the fair value in the period identified. | |||||||||||||
The Company generally calculates fair value of indefinite-lived intangible assets as the present value of estimated future cash flows. In determining the estimated future cash flows associated with intangible assets, the Company uses estimates and assumptions about future revenue contributions, cost structures and remaining useful lives of the asset (asset group). The use of alternative assumptions, including estimated cash flows, discount rates, and alternative estimated remaining useful lives could result in different calculations of impairment. | |||||||||||||
The Company tests goodwill at least annually for impairment. The Company tests more frequently if indicators are present or changes in circumstances suggest that impairment may exist. These indicators include, among others, declines in sales, earnings or cash flows, or the development of a material adverse change in the business climate. The Company assesses goodwill for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment, referred to as a component. The Company has identified two reporting units, which are consistent with the Company’s reporting segments; Spine and Orthopedics (see Note 13 for additional information). | |||||||||||||
Goodwill | |||||||||||||
In order to calculate the respective carrying values, the Company initially recorded goodwill based on the purchase price allocation performed at the time of acquisition. Corporate assets and liabilities that directly relate to a reporting unit’s operations are ascribed directly to that reporting unit. Corporate assets and liabilities that are not directly related to a specific reporting unit, but from which the reporting unit benefits, are allocated based on the respective contribution measure of each reporting unit. Effective January 1, 2011, the Company re-aligned its reporting units and consequently reallocated the carrying value of goodwill from its previous reporting units to its new reporting units based on the relative fair value of each new reporting unit to total enterprise value at January 1, 2011. | |||||||||||||
In the first quarter of 2012, Accounting Standards Update (“ASU”) 2011-08, “Testing of Goodwill for Impairment” became effective. ASU 2011-08 allows entities testing goodwill for impairment the option of performing a qualitative assessment before calculating the fair value of a reporting unit (i.e. the first step of the goodwill impairment test). If entities determine, on the basis of qualitative factors, that the fair value of the reporting unit is more likely than not greater than the carrying amount, a quantitative calculation would not be needed. | |||||||||||||
The Company’s annual goodwill impairment analysis, which was performed qualitatively during the fourth quarter of 2012, did not result in impairment charge. | |||||||||||||
(i) | Derivative instruments | ||||||||||||
The Company manages its exposure to fluctuating cash flows resulting from changes in interest rates and foreign exchange within the consolidated financial statements according to its hedging policy. Under the policy, the Company may engage in non-leveraged transactions involving various financial derivative instruments to manage exposed positions. The policy requires the Company to formally document the relationship between the hedging instrument and hedged item, as well as its risk-management objective and strategy for undertaking the hedge transaction. For instruments designated as a cash flow hedge, the Company formally assesses (both at the hedge’s inception and on an ongoing basis) whether the derivative that is used in the hedging transaction has been effective in offsetting changes in the cash flows of the hedged item and whether such derivative may be expected to remain effective in future periods. If it is determined that a derivative is not (or has ceased to be) effective as a hedge, the Company will discontinue the related hedge accounting prospectively. Such a determination would be made when (1) the derivative is no longer effective in offsetting changes in the cash flows of the hedged item; (2) the derivative expires or is sold, terminated or exercised; or (3) management determines that designating the derivative as a hedging instrument is no longer appropriate. Ineffective portions of changes in the fair value of cash flow hedges are recognized in earnings. | |||||||||||||
The Company records all derivatives as either assets or liabilities on the balance sheet at their respective fair values. For a cash flow hedge, the effective portion of the derivative’s change in fair value (i.e. gains or losses) is initially reported as a component of other comprehensive income, net of related taxes, and subsequently reclassified into net earnings when the hedged exposure is no longer effective. | |||||||||||||
The Company utilizes a cross currency swap to manage its foreign currency exposure related to a portion of the Company’s intercompany receivable of a U.S. dollar functional currency subsidiary that is denominated in Euro. The cross currency swap has been accounted for as a cash flow hedge in accordance with ASC Topic 815, Derivatives and Hedging. | |||||||||||||
See Note 10 for a description of the types of derivative instruments the Company utilizes. | |||||||||||||
(j) | Accumulated other comprehensive income | ||||||||||||
Accumulated other comprehensive income is comprised of foreign currency translation adjustments and the effective portion of the gain (loss) on the Company’s cross-currency swap, which is designated and accounted for as a cash flow hedge (see Note 10). The components of and changes in accumulated other comprehensive income are as follows: | |||||||||||||
(U.S. Dollars, in thousands) | Foreign Currency | Fair Value of | Accumulated Other | ||||||||||
Translation | Cross- | Comprehensive | |||||||||||
Adjustments | Currency Swaps | Income (Loss) | |||||||||||
Balance at December 31, 2010 (Restated) | $ | 6,125 | $ | 305 | $ | 6,430 | |||||||
Unrealized loss on cross-currency swaps, net of tax benefit of $256 | — | (437 | ) | (437 | ) | ||||||||
Foreign currency translation adjustment (1) | (2,279 | ) | — | (2,279 | ) | ||||||||
Balance at December 31, 2011 (Restated) | 3,846 | (132 | ) | 3,714 | |||||||||
Unrealized gain on cross-currency swaps, net of tax of $153 | — | 263 | 263 | ||||||||||
Foreign currency translation adjustment (1) | 768 | — | 768 | ||||||||||
Balance at December 31, 2012 (Restated) | $ | 4,614 | $ | 131 | $ | 4,745 | |||||||
-1 | As the cash generally remains permanently invested in the non U.S. dollar denominated foreign subsidiaries, no deferred taxes are recognized on the related foreign currency translation adjustment. | ||||||||||||
(k) | Revenue recognition and accounts receivable | ||||||||||||
Commercial revenue is related to the sale of the Company’s spine and orthopedic implant products, generally representing hospital customers. Revenues are recognized when these products have been utilized and a confirming purchase order has been received from the hospital. | |||||||||||||
Revenue is derived from third-party payors, including commercial insurance carriers, health maintenance organizations, preferred provider organizations and governmental payors such as Medicare, in connection with the sale of our stimulation products. Revenue is recognized when the stimulation product is placed on or implanted in and accepted by the patient. Amounts paid by these third-party payors are generally based on fixed or allowable reimbursement rates. These revenues are recorded at the expected or pre-authorized reimbursement rates, net of any contractual allowances or adjustments. Certain billings are subject to review by the third-party payors and may be subject to adjustment. | |||||||||||||
For distributor revenue which is related primarily to spine and orthopedic implant products, the Company recognizes revenue either on a sell-in or sell-through basis depending on the specific circumstances of the distributor. In some cases the Company recognizes distributor revenue as title and risk of loss passes at either shipment from the Company’s facilities or receipt at the distributor’s facility, assuming all other revenue recognition criteria has been achieved (the “sell-in method”). Based on the results of the Independent Review, the Company determined in some cases the revenue recognition criteria for distributor sales were not satisfied at the time of shipment or receipt; specifically, the existence of extra-contractual terms or arrangements caused the Company not to meet the fixed or determinable criteria for revenue recognition in some cases, and in others collectability had not been established. In situations where we are unable to satisfy the requirements to recognize revenue on the sell-in method, we recognize revenue relating to distributor arrangements once the product is delivered to the end customer (the “sell-through method”). Because the Company does not have reliable information about when its distributors sell the product through to end customers, the Company uses cash collection from distributors as a basis for revenue recognition under the sell-through method. Although in many cases the Company is legally entitled to the accounts receivable at the time of shipment, the Company has not recognized accounts receivables or any corresponding deferred revenues associated with distributor transactions for which revenue is recognized on the sell-through method. Effective April 1, 2013, all distributor revenue is recognized on the sell-through basis. | |||||||||||||
For distributors on the sell-in method, cost of sales are recognized upon shipment. For sell-through distributors, whose revenue is recognized upon cash receipt, the Company considers whether to match the related cost of sales expense with revenue or to recognize expense upon shipment. In making this assessment, the Company considers the financial viability of its distributors based on their creditworthiness to determine if collectability of amounts sufficient to realize the costs of the products shipped is reasonably assured at the time of shipment to these distributors. In instances where the distributor is determined to be financially viable, the Company defers the costs of sales until the revenue is recognized. | |||||||||||||
Biologics revenue is primarily related to a collaborative arrangement with MTF. In 2008, the Company entered into a collaborative arrangement with MTF to develop and commercialize Trinity Evolution ®, a stem cell-based bone growth biologic matrix. With the development process completed in 2009, the Company and MTF operated under the terms of a separate commercialization agreement. Under the terms of the 10-year agreement, MTF sourced the tissue, processed it to create the bone growth matrix, packaged and delivered it to the customer in accordance with orders received from the Company. The Company has exclusive global marketing rights for Trinity Evolution ® and receives marketing fees from MTF based on total sales. These marketing fees are recorded on a net basis within net sales and were $46.5 million, $36.8 million and $29.7 million in 2012, 2011 and 2010, respectively. On January 10, 2012, the Company announced that it had reached an agreement with MTF to both co-develop and commercialize a new technology for use in bone grafting applications and to expand MTF’s Trinity Evolution ® processing capacity. The amendment amends the term of the existing agreement until the later of (i) 15 years after the date that certain development milestones were achieved under the existing agreement (which occurred during 2010) or (ii) the date that certain licensing arrangements between the Company and NuVasive, Inc. expire. MTF is considered the primary obligor in these arrangements and therefore the Company recognizes these marketing service fees on a net basis upon shipment of the product to the customer. | |||||||||||||
Revenues exclude any value added or other local taxes, intercompany sales and trade discounts. Shipping and handling costs are included in cost of sales. Royalty revenues are recognized when the royalty is earned. | |||||||||||||
The process for estimating the ultimate collection of accounts receivable involves significant assumptions and judgments. Historical collection and payor reimbursement experience is an integral part of the estimation process related to reserves for doubtful accounts and the establishment of contractual allowances. Accounts receivable are analyzed on a quarterly basis to assess the adequacy of both reserves for doubtful accounts and contractual allowances. Revisions in allowances for doubtful accounts estimates are recorded as an adjustment to bad debt expense within sales and marketing expenses, and contractual allowances are recorded as an adjustment to revenue. In the judgment of management, adequate allowances have been provided for doubtful accounts and contractual allowances. These estimates are periodically tested against actual collection experience. | |||||||||||||
(l) | Sale of accounts receivable | ||||||||||||
The Company will generally sell receivables from certain Italian hospitals each year. The estimated related fee for 2012 was $0.6 million which is recorded as interest expense. Trade accounts receivables sold without recourse are removed from the balance sheet at the time of sale. | |||||||||||||
(m) | Share-based compensation | ||||||||||||
The fair value of stock options is determined using the Black-Scholes valuation model. Such value is recognized as expense over the service period net of estimated forfeitures. | |||||||||||||
The expected term of options granted is estimated based on a number of factors, including the vesting and expiration terms of the award, historical employee exercise behavior for both options that are currently outstanding and options that have been exercised or are expired, the expected volatility of the Company’s common stock and an employee’s average length of service. The risk-free interest rate is determined based upon a constant U.S. Treasury security rate with a contractual life that approximates the expected term of the option award. Management estimates expected volatility based on the historical volatility of the Company’s stock. The compensation expense recognized for all equity-based awards is net of estimated forfeitures. Forfeitures are estimated based on an analysis of actual option forfeitures. | |||||||||||||
(n) | Advertising costs | ||||||||||||
The Company expenses all advertising costs as incurred. Advertising expense included in sales and marketing expense for the years ended December 31, 2012, 2011 and 2010 was $0.3 million, $0.5 million and $0.6 million, respectively. | |||||||||||||
(o) | Research and development costs | ||||||||||||
Expenditures for research and development are expensed as incurred. Expenditures related to the collaborative arrangement with MTF are expensed based on the terms of the related agreement. Milestone payments made to MTF in 2012 totaled $3 million. | |||||||||||||
(p) | Income taxes | ||||||||||||
The Company is subject to income taxes in both the U.S. and foreign jurisdictions, and uses estimates in determining the provision for income taxes. The Company accounts for income taxes using the asset and liability method for accounting and reporting for income taxes. Under this method, deferred tax assets and liabilities are recognized based on temporary differences between the financial reporting and income tax basis of assets and liabilities using statutory rates. This process requires that the Company project the current tax liability and estimate the deferred tax assets and liabilities, including net operating loss and tax credit carryforwards. In assessing the need for a valuation allowance, the Company has considered the recent operating results, future taxable income projections and all prudent and feasible tax planning strategies. | |||||||||||||
The Company accounts for uncertain tax positions in accordance with ASC Topic 740, Income Taxes, which contains a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company re-evaluates income tax positions periodically to consider factors such as changes in facts or circumstances, changes in or interpretations of tax law, effectively settled issues under audit, and new audit activity. Such a change in recognition or measurement would result in recognition of a tax benefit or an additional charge to the tax provision. | |||||||||||||
The Company includes imputed interest related to tax issues as part of income tax expense in our consolidated financial statements. The Company records any applicable penalties related to tax issues within the income tax provision. | |||||||||||||
(q) | Net income (loss) per common share | ||||||||||||
Net income (loss) per common share—basic is computed using the weighted average number of common shares outstanding during each of the respective years. Net income (loss) per common share—diluted is computed using the weighted average number of common and common equivalent shares outstanding during each of the respective years using the “treasury stock” method, if dilutive. Common equivalent shares represent the dilutive effect of the assumed exercise of outstanding share options (see Note 20). The only differences between basic and diluted shares result from the assumed exercise of certain outstanding share options. | |||||||||||||
(r) | Financial Instruments and Concentration of Credit Risk | ||||||||||||
Financial instruments that could subject the Company to a concentration of credit risk consist primarily of cash and cash equivalents and accounts receivable. Generally, the cash is held at large financial institutions and our cash equivalents consist of highly liquid money market funds. The Company performs ongoing credit evaluations of the customers, generally do not require collateral and maintain a reserve for potential credit losses. The Company believes that a concentration of credit risk related to the accounts receivable is limited because the customers are geographically dispersed and the end users are diversified across several industries. | |||||||||||||
Net sales to our customers and distributors based in Europe were approximately $55 million in 2012 which results in a substantial portion of our trade accounts receivable balance as of December 31, 2012. It is at least reasonably possible that changes in global economic conditions and/or local operating and economic conditions in the regions these distributors operate, or other factors, could affect the future realization of these accounts receivable balances. | |||||||||||||
(s) | Recently Issued Accounting Standards | ||||||||||||
In July 2012, the FASB issued ASU No. 2012-02, Intangibles—Goodwill and Other (Topic 350). The standard is intended to reduce the cost and complexity of performing an impairment test for indefinite-lived intangible assets by simplifying how an entity tests those assets for impairment and to improve consistency in impairment testing guidance among long-lived asset categories. The amendments permit an entity to first assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform the quantitative impairment test in accordance with Subtopic 350-30, Intangibles—Goodwill and Other—General Intangibles Other than Goodwill. The more-likely-than-not threshold is defined as having a likelihood of more than 50 percent. The amendments are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. The Company adopted this ASU as of December 31, 2012 and it did not have a material impact on the Company’s consolidated financial statements. | |||||||||||||
On June 16, 2011, the FASB issued ASU No. 2011-05, Presentation of Comprehensive Income. This ASU eliminates the current option to present other comprehensive income and its components in the statement of changes in shareholders’ equity and increases the prominence of other comprehensive income in the statements by providing an alternative to present the components of net income and comprehensive income as either one continuous or two separate but consecutive financial statements. Companies are also required to present reclassification adjustments for items that are reclassified from other comprehensive income to net income within these statements. This standard is to be applied retrospectively and is effective for fiscal years beginning after December 15, 2011 with early adoption permitted. The Company adopted this ASU as of March 31, 2012 and it did not have a material impact on the Company’s consolidated financial statements. |
Restatement_of_the_Consolidate
Restatement of the Consolidated Financial Statements | 12 Months Ended | ||||||||||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||||||||||
Text Block [Abstract] | ' | ||||||||||||||||||||||||||||
Restatement of the Consolidated Financial Statements | ' | ||||||||||||||||||||||||||||
2 | Restatement of the Consolidated Financial Statements | ||||||||||||||||||||||||||||
Background | |||||||||||||||||||||||||||||
In July 2013, the Audit Committee (the “Audit Committee”) of the Company’s Board of Directors (the “Board”) commenced an independent review with the assistance of outside professionals into whether the Company had properly recognized revenue under U.S. generally accepted accounting principles (“GAAP”) in connection with certain revenue that had been recorded in 2012 and 2011 (the “Independent Review”). In conjunction with the Independent Review, the Company concluded that errors existed in the Company’s previously issued financial statements for the fiscal years ended December 31, 2012, 2011 and 2010 (as well as the interim quarterly periods within such years), as well as for the interim quarterly period ended March 31, 2013. In addition, the Company has identified and corrected errors occurring prior to January 1, 2010 by recognizing a cumulative adjustment to beginning retained earnings in the consolidated statements of changes in shareholders’ equity included in these consolidated financial statements. | |||||||||||||||||||||||||||||
In reaching these conclusions, the Company considered information obtained in the Independent Review, including emails, data and interviews with current and former employees that indicated (i) the existence of extra-contractual terms or arrangements at the onset of the sale and concessions agreed to subsequent to the initial sale, such as extended payment terms and return and exchange rights for sales to distributors with respect to certain transactions, (ii) that at the time of some sales collection was not reasonably assured, and (iii) that certain amounts previously characterized as commissions were paid to related parties of the applicable customer. | |||||||||||||||||||||||||||||
The Company assessed the information derived from the Independent Review in making determinations with respect to accounting adjustments reflected in these restated consolidated financial statements, and such determinations are consistent with the findings of the Independent Review. In addition to the matters that were the subject of the Independent Review, certain other adjustments identified by management, including revisions to inventory reserves and royalties, were made to the consolidated financial statements in connection with the restatement. | |||||||||||||||||||||||||||||
The correction of these errors had the following impact: decreased net sales by $14.7 million and $28.2 million for the years ended December 31, 2012 and 2011, respectively, and increased net sales by $1.9 million for the year ended December 31, 2010; decreased net income from continuing operations by $8.9 million and $14.5 million for the years ended December 31, 2012 and 2011, respectively, and increased net income from continuing operations by $3.2 million for the year ended December 31, 2010; and decreased opening retained earnings and total shareholders’ equity at January 1, 2010 by $8.3 million and $7.6 million, respectively. The following include descriptions of the significant adjustments to the Company’s financial position and results of operations from the previously reported consolidated financial statements. | |||||||||||||||||||||||||||||
Distributor Revenue Recognition | |||||||||||||||||||||||||||||
The Company has determined that it previously recognized revenue with respect to certain distributor relationships before all revenue recognition criteria were met. Specifically, the Company has determined that a fixed or determinable sales price did not exist, and/or collection was not reasonably assured, with respect to certain transactions where revenue had previously been recognized at the time of shipment. Specifically, the Company’s review revealed arrangements, or extra-contractual terms, with certain of the Company’s distributors regarding extended payment terms, return or exchange rights, and contingent payment obligations for sales to such distributors with respect to certain transactions. There were also concessions being made subsequent to the shipment of inventory to the distributors and the related revenue recognition. Based on the results of this review, it was determined that these arrangements were not appropriately evaluated under the appropriate revenue recognition criteria applicable under GAAP. Distributor sales represented approximately 11 – 13% of the Company’s net sales (prior to the restatement) of approximately $462 million, $470 million, and $461 million for the years ended December 31, 2012, 2011, and 2010, respectively. | |||||||||||||||||||||||||||||
The Company previously recognized distributor revenue as title and risk of loss passed at either shipment from the Company’s facilities or receipt at the distributor’s facility, assuming all other revenue recognition criteria had been achieved (the “sell-in method”). Based on review of all facts and circumstances related to the arrangements described above, the Company determined that in many instances the revenue recognition criteria under the sell-in method were not satisfied at the time of shipment or receipt; specifically, the existence of extra-contractual terms or arrangements caused the Company not to meet the fixed or determinable criteria for revenue recognition in some cases, and in others collectability had not been established. In situations where the Company is unable to reasonably estimate the effects of these extra-contractual terms, it is precluded from recognizing revenue relating to distributor arrangements until the product is delivered to the end customer. This method is commonly referred to as the “sell-through” revenue recognition method because the vendor does not recognize revenue until the transaction consideration is fixed or determinable, which coincides with the selling of the product through the distribution channel to the end customer. Because the Company does not have reliable information about when its distributors sell the product through to end customers, the Company will use cash collection from distributors as a basis for revenue recognition under the sell-through method. Although in many cases the Company is legally entitled to the accounts receivable at the time of shipment, since the revenue recognition criteria has not been met, the Company has not recognized accounts receivables or any corresponding deferred revenues associated with these transactions. | |||||||||||||||||||||||||||||
As part of the review, the Company also considered the accounting treatment for the related cost of sales when distributor revenue is recognized on a sell-through basis. Previously, cost of sales were recognized upon shipment; however, the Company believes the matching of the recognition of costs of sales with revenue is preferred and therefore considered if such costs should be deferred until revenue is recognized on a sell-through basis. In making this assessment, the Company considered the financial viability of its distributors based on their creditworthiness to determine if collectability of amounts sufficient to realize the costs of the products shipped was reasonably assured at the time of shipment to these distributors. In instances where the distributor was determined to be financially viable, the Company determined that costs of sales should be deferred until the revenue is recognized. For those distributors where the Company has concluded that collectability was not reasonably assured, the Company has expensed the related cost of sales upon shipment. | |||||||||||||||||||||||||||||
Based on the results of the Independent Review, the Company determined that all distributor transactions should be transitioned to the sell-through method of accounting as of the dates described below: | |||||||||||||||||||||||||||||
• | For distributor transactions within the Company’s Orthopedics division, the Company has determined that sell-through accounting should be applied within the Brazil subsidiary for all prior periods given the frequency with which the Company conducted business under extra-contractual and undocumented terms, as well as the Company’s inability to fully access underlying transactional and other information that would be necessary to evaluate transactions under a sell-in basis. Adjustments from periods ending prior to January 1, 2010 are presented by recording a cumulative effect in opening retained earnings and total shareholders’ equity at January 1, 2010. For distributor transactions within the division outside the Brazil subsidiary, there were also sales to four distributors that did not meet the fixed or determinable or collectability revenue recognition criteria and therefore, such sales were adjusted to sell-through accounting in the restatement. | ||||||||||||||||||||||||||||
• | For distributor transactions within the Company’s U.S. Spine division, the Company has determined that sell-through accounting should be applied beginning January 1, 2011. Following its consideration of the information provided from the Independent Review, the Company believes that January 1, 2011 is the date extra-contractual terms became pervasive in the Company’s U.S. business, and it is unaware of circumstances existing prior to that date that would require it to broadly apply sell-through accounting to all distributor transactions within the U.S. Spine division. Additionally, there were sales in 2012 and 2011 for which revenue was previously recognized that did not meet the fixed or determinable criteria and the product associated with such sales was subsequently returned in 2013 (i) under the terms of negotiated agreements whereby the Company terminated its relationships with two distributors and (ii) by an additional distributor who returned certain product sold pursuant to a contingent sales arrangement. Such sales represented approximately $3.3 million and $4.1 million for the years ended December 31, 2012 and 2011, respectively. Due to the return of the product, no revenue will be recognized for these transactions. | ||||||||||||||||||||||||||||
• | The Company has determined that stimulation products sold to distributors within the Company’s U.S. Spine division during 2012 did not meet the fixed or determinable (and in some cases, collectability) revenue recognition criterion at the time of shipment. Therefore, the Company has determined that sell-through accounting should be applied for these sales. Management also determined that many of these distributors (or affiliates thereof) received commission payments as part of the sales transactions, which the Company previously recorded as sales and marketing expense. The Company has recorded adjustments in the restatement to net these commission expenses against revenue, as they represented product discounts. | ||||||||||||||||||||||||||||
• | The Company has determined that it will prospectively apply sell-through accounting for all remaining distributor arrangements (which entails arrangements within the Company’s Orthopedics division outside the Brazil subsidiary) beginning April 1, 2013, the earliest date for which financial statements have not previously been issued by the Company. Although the Independent Review did not provide information to indicate extra-contractual terms or that historical revenue recognition was inappropriate in these remaining instances, the Company believes the information from the Independent Review indicating that the Company has a history of extra-contractual arrangements for distributor transactions, as described above, provides additional information which should be considered in reassessing the application of sell-through accounting on a prospective basis, particularly given that the Company believes that there is a higher risk associated with distributor arrangements generally. | ||||||||||||||||||||||||||||
The effect of adjustments made to the Company’s previously filed consolidated statements of operations as a result of these matters are shown in the tables below. These adjustments also had the following effects on the Company’s previously filed consolidated balance sheets: | |||||||||||||||||||||||||||||
• | Accounts receivable decreased as of December 31, 2012 and December 31, 2011, by $41.3 million and $33.8 million, respectively, related to the de-recognition of receivables for which revenue has been deferred and will now be recognized on a sell-through basis, based on cash collections. | ||||||||||||||||||||||||||||
• | Inventory increased as of December 31, 2012 and December 31, 2011 by $11.0 million and $8.8 million, respectively, to recognize the costs of inventory shipments to distributors determined to be financially viable as discussed previously. | ||||||||||||||||||||||||||||
Inventory Reserves | |||||||||||||||||||||||||||||
The Company also identified material errors in inventory reserves. One error related to the Company recording an increase of $1.2 million to the Company’s excess and obsolete reserve in the second quarter of 2012 related to a product within the Spine business that was subsequently reversed by the Company in the fourth quarter of 2012. During the Company’s review, it was determined that removing the reserve in the fourth quarter of 2012 was not correct; therefore the reserve has been reinstated. | |||||||||||||||||||||||||||||
The Company has also determined that certain inconsistencies existed with respect to how the Company previously computed and recorded inventory reserves. As a result, the Company has reviewed the methodologies used to compute and record inventory reserves and determined that errors in the application of GAAP existed in prior periods, which required adjustment in these financial statements. Based on this review, the Company has determined that it previously made reductions to previously recorded reserves based on changes in forecasted demand, which it believes was contrary to guidance set forth in ASC Topic 330, Inventory (specifically ASC 330-10-35-14), which states that a write-down of inventory to the lower-of-cost-or-market value at the close of a fiscal year creates a new cost basis that subsequently should not be marked up based on changes in underlying circumstances. The restated consolidated financial statements contain several adjustments to reflect recomputed inventory reserves in each of the relevant periods. | |||||||||||||||||||||||||||||
These adjustments resulted in a decrease to inventory (due to an increase in reserves) as of December 31, 2012 and December 31, 2011, by $14.8 million and $8.8 million, respectively. | |||||||||||||||||||||||||||||
Royalties | |||||||||||||||||||||||||||||
The Company also reviewed the accounting for royalties and determined there were royalties classified as sales and marketing expense; however, such royalties were based on sales of products and were paid to doctors who consulted on development of those products. Given these amounts are attributable to the cost of producing our products, we determined they are correctly classified as cost of goods sold. | |||||||||||||||||||||||||||||
Other Adjustments | |||||||||||||||||||||||||||||
In addition to the adjustments recorded to address the Company’s errors in accounting for distributor revenue recognition, inventory reserves, and royalties, the Company has identified other errors that are generally not material, individually or in the aggregate, but have been recorded in connection with the restatement. | |||||||||||||||||||||||||||||
Included in Other Adjustments are adjustments to reclassify interest expense from continuing operations to discontinued operations of $3.9 million, and $4.9 million for the years ended December 31, 2011 and 2010, respectively. The reclassification was necessary as the Company used a portion of the proceeds from the sale of Breg, Inc. to repay in full the remaining $87.5 million balance on the Term Loan Facility and pay down $57.5 million of amounts outstanding under the Revolving Credit Facility. | |||||||||||||||||||||||||||||
There were no material impacts to the statements of cash flows for the items above other than to increase operating cash flows and decrease financing cash flows for $1 million for the year ended December 31, 2012. The results of the adjustments to the Company’s previously filed consolidated statements of operations detailed above are summarized in the tables below. The tax effect of the adjustments is estimated based on the Company’s effective tax rate. | |||||||||||||||||||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 462,320 | $ | (14,777 | ) | $ | — | $ | — | $ | 38 | $ | (14,739 | ) | $ | 447,581 | |||||||||||||
Cost of sales | 86,492 | (2,032 | ) | 5,647 | 8,190 | (44 | ) | 11,761 | 98,253 | ||||||||||||||||||||
Gross profit | 375,828 | (12,745 | ) | (5,647 | ) | (8,190 | ) | 82 | (26,500 | ) | 349,328 | ||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,343 | (6,629 | ) | — | (8,190 | ) | 1,607 | (13,212 | ) | 187,131 | |||||||||||||||||||
General and administrative | 53,827 | (2 | ) | — | — | (434 | ) | (436 | ) | 53,391 | |||||||||||||||||||
Research and development | 28,577 | — | — | — | — | — | 28,577 | ||||||||||||||||||||||
Amortization of intangibles assets | 2,098 | — | — | — | 200 | 200 | 2,298 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | 1,973 | — | — | — | (678 | ) | (678 | ) | 1,295 | ||||||||||||||||||||
286,818 | (6,631 | ) | — | (8,190 | ) | 695 | (14,126 | ) | 272,692 | ||||||||||||||||||||
Operating income | 89,010 | (6,114 | ) | (5,647 | ) | — | (613 | ) | (12,374 | ) | 76,636 | ||||||||||||||||||
Other income and (expense) | (6,282 | ) | — | — | — | (166 | ) | (166 | ) | (6,448 | ) | ||||||||||||||||||
Income before income taxes | 82,728 | (6,114 | ) | (5,647 | ) | — | (779 | ) | (12,540 | ) | 70,188 | ||||||||||||||||||
Income tax expense | (28,792 | ) | 1,782 | 1,645 | — | 227 | 3,654 | (25,138 | ) | ||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 53,936 | $ | (4,332 | ) | $ | (4,002 | ) | $ | — | $ | (552 | ) | $ | (8,886 | ) | $ | 45,050 | |||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 470,121 | $ | (29,135 | ) | $ | — | $ | — | $ | 985 | $ | (28,150 | ) | $ | 441,971 | |||||||||||||
Cost of sales | 92,619 | (8,289 | ) | 3,377 | 7,713 | 107 | 2,908 | 95,527 | |||||||||||||||||||||
Gross profit | 377,502 | (20,846 | ) | (3,377 | ) | (7,713 | ) | 878 | (31,058 | ) | 346,444 | ||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,145 | (1,216 | ) | — | (7,713 | ) | 2,295 | (6,634 | ) | 193,511 | |||||||||||||||||||
General and administrative | 64,374 | — | — | — | 107 | 107 | 64,481 | ||||||||||||||||||||||
Research and development | 22,861 | — | — | — | — | — | 22,861 | ||||||||||||||||||||||
Amortization of intangibles assets | 2,350 | — | — | — | 200 | 200 | 2,550 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | 56,463 | — | — | — | 678 | 678 | 57,141 | ||||||||||||||||||||||
346,193 | (1,216 | ) | — | (7,713 | ) | 3,280 | (5,649 | ) | 340,544 | ||||||||||||||||||||
Operating income | 31,309 | (19,630 | ) | (3,377 | ) | — | (2,402 | ) | (25,409 | ) | 5,900 | ||||||||||||||||||
Other income and (expense) | (11,868 | ) | — | — | — | 3,915 | 3,915 | (7,953 | ) | ||||||||||||||||||||
Income (loss) before income taxes | 19,441 | (19,630 | ) | (3,377 | ) | — | 1,513 | (21,494 | ) | (2,053 | ) | ||||||||||||||||||
Income tax expense | (21,181 | ) | 6,408 | 1,102 | — | (494 | ) | 7,016 | (14,165 | ) | |||||||||||||||||||
Net loss from continuing operations, net of tax | $ | (1,740 | ) | $ | (13,222 | ) | $ | (2,275 | ) | $ | — | $ | 1,019 | $ | (14,478 | ) | $ | (16,218 | ) | ||||||||||
Year Ended December 31, 2010 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 460,629 | $ | 2,088 | $ | — | $ | — | $ | (146 | ) | $ | 1,942 | $ | 462,571 | ||||||||||||||
Cost of sales | 90,461 | (323 | ) | 2,281 | 5,386 | (712 | ) | 6,632 | 97,093 | ||||||||||||||||||||
Gross profit | 370,168 | 2,411 | (2,281 | ) | (5,386 | ) | 566 | (4,690 | ) | 365,478 | |||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,835 | (275 | ) | — | (5,386 | ) | 939 | (4,722 | ) | 196,113 | |||||||||||||||||||
General and administrative | 72,912 | — | — | — | 98 | 98 | 73,010 | ||||||||||||||||||||||
Research and development | 27,958 | — | — | — | — | — | 27,958 | ||||||||||||||||||||||
Amortization of intangibles assets | 2,213 | — | — | — | 200 | 200 | 2,413 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | — | — | — | — | — | — | — | ||||||||||||||||||||||
303,918 | (275 | ) | — | (5,386 | ) | 1,237 | (4,424 | ) | 299,494 | ||||||||||||||||||||
Operating income | 66,250 | 2,686 | (2,281 | ) | — | (671 | ) | (266 | ) | 65,984 | |||||||||||||||||||
Other income and (expense) | (15,886 | ) | — | — | — | 4,930 | 4,930 | (10,956 | ) | ||||||||||||||||||||
Income before income taxes | 50,364 | 2,686 | (2,281 | ) | — | 4,259 | 4,664 | 55,028 | |||||||||||||||||||||
Income tax expense | (22,606 | ) | (821 | ) | 697 | — | (1,301 | ) | (1,425 | ) | (24,031 | ) | |||||||||||||||||
Net income from continuing operations, net of tax | $ | 27,758 | $ | 1,865 | $ | (1,584 | ) | $ | — | $ | 2,958 | $ | 3,239 | $ | 30,997 | ||||||||||||||
The effects of the restatements on the Company’s consolidated balance sheet as of December 31, 2012 are as follows: | |||||||||||||||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 31,055 | $ | — | $ | 31,055 | |||||||||||||||||||||||
Restricted cash | 21,314 | — | 21,314 | ||||||||||||||||||||||||||
Trade accounts receivable, less allowances of $13,543 | 150,316 | (43,004 | ) | 107,312 | |||||||||||||||||||||||||
Inventories | 88,744 | (5,371 | ) | 83,373 | |||||||||||||||||||||||||
Deferred income taxes | 16,959 | 16,491 | 33,450 | ||||||||||||||||||||||||||
Escrow receivable | — | — | — | ||||||||||||||||||||||||||
Prepaid expenses and other current assets | 32,056 | 2,023 | 34,079 | ||||||||||||||||||||||||||
Assets held for sale | — | — | — | ||||||||||||||||||||||||||
Total current assets | 340,444 | (29,861 | ) | 310,583 | |||||||||||||||||||||||||
Property, plant and equipment, net | 51,362 | 2,473 | 53,835 | ||||||||||||||||||||||||||
Patents and other intangible assets, net | 6,880 | 410 | 7,290 | ||||||||||||||||||||||||||
Goodwill | 74,388 | — | 74,388 | ||||||||||||||||||||||||||
Deferred income taxes | 19,904 | (1,023 | ) | 18,881 | |||||||||||||||||||||||||
Other long-term assets | 11,303 | (3,383 | ) | 7,920 | |||||||||||||||||||||||||
Total assets | $ | 504,281 | $ | (31,384 | ) | $ | 472,897 | ||||||||||||||||||||||
Liabilities and shareholders’ equity | |||||||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||||||
Bank borrowings | $ | 16 | $ | — | $ | 16 | |||||||||||||||||||||||
Current portion of long-term debt | — | — | — | ||||||||||||||||||||||||||
Trade accounts payable | 21,812 | 763 | 22,575 | ||||||||||||||||||||||||||
Accrued charges related to U.S. Government resolutions | — | — | — | ||||||||||||||||||||||||||
Other current liabilities | 46,969 | (7,375 | ) | 39,594 | |||||||||||||||||||||||||
Liabilities held for sale | — | — | — | ||||||||||||||||||||||||||
Total current liabilities | 68,797 | (6,612 | ) | 62,185 | |||||||||||||||||||||||||
Long-term debt | 20,000 | — | 20,000 | ||||||||||||||||||||||||||
Deferred income taxes | 11,456 | — | 11,456 | ||||||||||||||||||||||||||
Other long-term liabilities | 4,930 | 6,494 | 11,424 | ||||||||||||||||||||||||||
Total liabilities | 105,183 | (118 | ) | 105,065 | |||||||||||||||||||||||||
Contingencies (Note 17) | |||||||||||||||||||||||||||||
Shareholders’ equity | |||||||||||||||||||||||||||||
Common shares $0.10 par value; 50,000,000 shares authorized; 19,339,329 issued and outstanding | 1,934 | — | 1,934 | ||||||||||||||||||||||||||
Additional paid-in capital | 246,111 | 195 | 246,306 | ||||||||||||||||||||||||||
Retained earnings | 148,549 | (33,702 | ) | 114,847 | |||||||||||||||||||||||||
Accumulated other comprehensive income | 2,504 | 2,241 | 4,745 | ||||||||||||||||||||||||||
Total shareholders’ equity | 399,098 | (31,266 | ) | 367,832 | |||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 504,281 | $ | (31,384 | ) | $ | 472,897 | ||||||||||||||||||||||
The effects of the restatements on the Company’s consolidated balance sheet as of December 31, 2011 are as follows: | |||||||||||||||||||||||||||||
As of December 31, 2011 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 33,207 | $ | — | $ | 33,207 | |||||||||||||||||||||||
Restricted cash | 45,476 | — | 45,476 | ||||||||||||||||||||||||||
Trade accounts receivable, less allowances of $9,341 | 132,828 | (32,940 | ) | 99,888 | |||||||||||||||||||||||||
Inventories | 82,969 | (1,441 | ) | 81,528 | |||||||||||||||||||||||||
Deferred income taxes | 16,349 | 19,964 | 36,313 | ||||||||||||||||||||||||||
Escrow receivable | 41,537 | — | 41,537 | ||||||||||||||||||||||||||
Prepaid expenses and other current assets | 26,069 | (4,070 | ) | 21,999 | |||||||||||||||||||||||||
Assets held for sale | 171,185 | — | 171,185 | ||||||||||||||||||||||||||
Total current assets | 549,620 | (18,487 | ) | 531,133 | |||||||||||||||||||||||||
Property, plant and equipment, net | 43,368 | 2,769 | 46,137 | ||||||||||||||||||||||||||
Patents and other intangible assets, net | 8,236 | 610 | 8,846 | ||||||||||||||||||||||||||
Goodwill | 73,094 | — | 73,094 | ||||||||||||||||||||||||||
Deferred income taxes | 18,584 | (1,843 | ) | 16,741 | |||||||||||||||||||||||||
Other long-term assets | 11,570 | (2,141 | ) | 9,429 | |||||||||||||||||||||||||
Total assets | $ | 704,472 | $ | (19,092 | ) | $ | 685,380 | ||||||||||||||||||||||
Liabilities and shareholders’ equity | |||||||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||||||
Bank borrowings | $ | 1,318 | $ | — | $ | 1,318 | |||||||||||||||||||||||
Current portion of long-term debt | 17,500 | — | 17,500 | ||||||||||||||||||||||||||
Trade accounts payable | 16,488 | 1,743 | 18,231 | ||||||||||||||||||||||||||
Accrued charges related to U.S. Government resolutions | 82,500 | 638 | 83,138 | ||||||||||||||||||||||||||
Other current liabilities | 45,327 | (4,491 | ) | 40,836 | |||||||||||||||||||||||||
Liabilities held for sale | 22,676 | — | 22,676 | ||||||||||||||||||||||||||
Total current liabilities | 185,809 | (2,110 | ) | 183,699 | |||||||||||||||||||||||||
Long-term debt | 191,195 | — | 191,195 | ||||||||||||||||||||||||||
Deferred income taxes | 9,778 | 9,778 | |||||||||||||||||||||||||||
Other long-term liabilities | 2,519 | 6,115 | 8,634 | ||||||||||||||||||||||||||
Total liabilities | 389,301 | 4,005 | 393,306 | ||||||||||||||||||||||||||
Contingencies (Note 17) | |||||||||||||||||||||||||||||
Shareholders’ equity | |||||||||||||||||||||||||||||
Common shares $0.10 par value; 50,000,000 shares authorized; 18,465,444 issued and outstanding | 1,846 | — | 1,846 | ||||||||||||||||||||||||||
Additional paid-in capital | 214,310 | 195 | 214,505 | ||||||||||||||||||||||||||
Retained earnings | 97,254 | (25,245 | ) | 72,009 | |||||||||||||||||||||||||
Accumulated other comprehensive income | 1,761 | 1,953 | 3,714 | ||||||||||||||||||||||||||
Total shareholders’ equity | 315,171 | (23,097 | ) | 292,074 | |||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 704,472 | $ | (19,092 | ) | $ | 685,380 | ||||||||||||||||||||||
The effects of the restatements on the Company’s consolidated statement of operations and comprehensive income for the year ended December 31, 2012 are as follows: | |||||||||||||||||||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 415,850 | (14,811 | ) | $ | 401,039 | |||||||||||||||||||||||
Marketing service fees | 46,470 | 72 | 46,542 | ||||||||||||||||||||||||||
Net sales | 462,320 | (14,739 | ) | 447,581 | |||||||||||||||||||||||||
Cost of sales | 86,492 | 11,761 | 98,253 | ||||||||||||||||||||||||||
Gross profit | 375,828 | (26,500 | ) | 349,328 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,343 | (13,212 | ) | 187,131 | |||||||||||||||||||||||||
General and administrative | 53,827 | (436 | ) | 53,391 | |||||||||||||||||||||||||
Research and development | 28,577 | — | 28,577 | ||||||||||||||||||||||||||
Amortization of intangible assets | 2,098 | 200 | 2,298 | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions (Note 17) | 1,973 | (678 | ) | 1,295 | |||||||||||||||||||||||||
286,818 | (14,126 | ) | 272,692 | ||||||||||||||||||||||||||
Operating income | 89,010 | (12,374 | ) | 76,636 | |||||||||||||||||||||||||
Other income and (expense) | |||||||||||||||||||||||||||||
Interest expense, net | (4,577 | ) | (166 | ) | (4,743 | ) | |||||||||||||||||||||||
Other expense | (1,705 | ) | — | (1,705 | ) | ||||||||||||||||||||||||
(6,282 | ) | (166 | ) | (6,448 | ) | ||||||||||||||||||||||||
Income before income taxes | 82,728 | (12,540 | ) | 70,188 | |||||||||||||||||||||||||
Income tax expense | (28,792 | ) | 3,654 | (25,138 | ) | ||||||||||||||||||||||||
Net income from continuing operations, net of tax | 53,936 | (8,886 | ) | 45,050 | |||||||||||||||||||||||||
Discontinued operations (Note 16) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | 1,345 | — | 1,345 | ||||||||||||||||||||||||||
Gain on sale of vascular operations, net of tax (Note 22) | — | — | — | ||||||||||||||||||||||||||
Loss from discontinued operations | (4,012 | ) | 1,018 | (2,994 | ) | ||||||||||||||||||||||||
Income tax benefit (expense) | 26 | (589 | ) | (563 | ) | ||||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (2,641 | ) | 429 | (2,212 | ) | ||||||||||||||||||||||||
Net income | $ | 51,295 | (8,457 | ) | $ | 42,838 | |||||||||||||||||||||||
Net income (loss) per common share—basic: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 2.84 | (0.47 | ) | $ | 2.37 | |||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.14 | ) | 0.02 | (0.12 | ) | ||||||||||||||||||||||||
Net income per common share—basic | $ | 2.7 | (0.45 | ) | $ | 2.25 | |||||||||||||||||||||||
Net income (loss) per common share—diluted: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 2.78 | (0.46 | ) | $ | 2.32 | |||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.14 | ) | 0.03 | (0.11 | ) | ||||||||||||||||||||||||
Net income per common share—diluted: | $ | 2.64 | (0.43 | ) | $ | 2.21 | |||||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 18,977,263 | — | 18,977,263 | ||||||||||||||||||||||||||
Diluted | 19,390,413 | — | 19,390,413 | ||||||||||||||||||||||||||
Other comprehensive income, before tax: | |||||||||||||||||||||||||||||
Translation adjustment | $ | 480 | 288 | $ | 768 | ||||||||||||||||||||||||
Unrealized gain on derivative instrument | 416 | — | 416 | ||||||||||||||||||||||||||
Other comprehensive income, before tax | 896 | 288 | 1,184 | ||||||||||||||||||||||||||
Income tax expense related to components of other comprehensive income | (153 | ) | — | (153 | ) | ||||||||||||||||||||||||
Other comprehensive income, net of tax | 743 | 288 | 1,031 | ||||||||||||||||||||||||||
Comprehensive income | $ | 52,038 | (8,169 | ) | $ | 43,869 | |||||||||||||||||||||||
The effects of the restatements on the Company’s consolidated statement of operations and comprehensive loss for the year ended December 31, 2011 are as follows: | |||||||||||||||||||||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 432,975 | (27,828 | ) | $ | 405,147 | |||||||||||||||||||||||
Marketing service fees | 37,146 | (322 | ) | 36,824 | |||||||||||||||||||||||||
Net sales | 470,121 | (28,150 | ) | 441,971 | |||||||||||||||||||||||||
Cost of sales | 92,619 | 2,908 | 95,527 | ||||||||||||||||||||||||||
Gross profit | 377,502 | (31,058 | ) | 346,444 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,145 | (6,634 | ) | 193,511 | |||||||||||||||||||||||||
General and administrative | 64,374 | 107 | 64,481 | ||||||||||||||||||||||||||
Research and development | 22,861 | — | 22,861 | ||||||||||||||||||||||||||
Amortization of intangible assets | 2,350 | 200 | 2,550 | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions (Note 17) | 56,463 | 678 | 57,141 | ||||||||||||||||||||||||||
346,193 | (5,649 | ) | 340,544 | ||||||||||||||||||||||||||
Operating income | 31,309 | (25,409 | ) | 5,900 | |||||||||||||||||||||||||
Other income and (expense) | |||||||||||||||||||||||||||||
Interest expense, net | (9,456 | ) | 3,915 | (5,541 | ) | ||||||||||||||||||||||||
Other expense | (2,412 | ) | — | (2,412 | ) | ||||||||||||||||||||||||
(11,868 | ) | 3,915 | (7,953 | ) | |||||||||||||||||||||||||
Income (loss) before income taxes | 19,441 | (21,494 | ) | (2,053 | ) | ||||||||||||||||||||||||
Income tax expense | (21,181 | ) | 7,016 | (14,165 | ) | ||||||||||||||||||||||||
Net loss from continuing operations, net of tax | (1,740 | ) | (14,478 | ) | (16,218 | ) | |||||||||||||||||||||||
Discontinued operations (Note 16) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | — | — | — | ||||||||||||||||||||||||||
Gain on sale of vascular operations, net of tax (Note 22) | — | — | — | ||||||||||||||||||||||||||
Income (loss) from discontinued operations | 1,263 | (3,968 | ) | (2,705 | ) | ||||||||||||||||||||||||
Income tax (expense) benefit | (596 | ) | 1,409 | 813 | |||||||||||||||||||||||||
Net income (loss) from discontinued operations, net of tax | 667 | (2,559 | ) | (1,892 | ) | ||||||||||||||||||||||||
Net loss | $ | (1,073 | ) | (17,037 | ) | $ | (18,110 | ) | |||||||||||||||||||||
Net income (loss) per common share—basic: | |||||||||||||||||||||||||||||
Net loss from continuing operations, net of tax | $ | (0.10 | ) | (0.79 | ) | $ | (0.89 | ) | |||||||||||||||||||||
Net income (loss) from discontinued operations, net of tax | 0.04 | (0.14 | ) | (0.10 | ) | ||||||||||||||||||||||||
Net loss per common share—basic | $ | (0.06 | ) | (0.93 | ) | $ | (0.99 | ) | |||||||||||||||||||||
Net income (loss) per common share—diluted: | |||||||||||||||||||||||||||||
Net loss from continuing operations, net of tax | $ | (0.10 | ) | (0.79 | ) | $ | (0.89 | ) | |||||||||||||||||||||
Net income (loss) from discontinued operations, net of tax | 0.04 | (0.14 | ) | (0.10 | ) | ||||||||||||||||||||||||
Net loss per common share—diluted: | $ | (0.06 | ) | (0.93 | ) | $ | (0.99 | ) | |||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 18,219,343 | — | 18,219,343 | ||||||||||||||||||||||||||
Diluted | 18,219,343 | — | 18,219,343 | ||||||||||||||||||||||||||
Other comprehensive loss, before tax: | |||||||||||||||||||||||||||||
Translation adjustment | $ | (3,192 | ) | 913 | $ | (2,279 | ) | ||||||||||||||||||||||
Unrealized loss on derivative instrument | (693 | ) | — | (693 | ) | ||||||||||||||||||||||||
Other comprehensive loss, before tax | (3,885 | ) | 913 | (2,972 | ) | ||||||||||||||||||||||||
Income tax benefit related to components of other comprehensive income | 256 | — | 256 | ||||||||||||||||||||||||||
Other comprehensive loss, net of tax | (3,629 | ) | 913 | (2,716 | ) | ||||||||||||||||||||||||
Comprehensive loss | $ | (4,702 | ) | (16,124 | ) | $ | (20,826 | ) | |||||||||||||||||||||
The effects of the restatements on the Company’s consolidated statement of operations and comprehensive income for the year ended December 31, 2010 are as follows: | |||||||||||||||||||||||||||||
Year Ended December 31, 2010 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 430,783 | 2,062 | $ | 432,845 | ||||||||||||||||||||||||
Marketing service fees | 29,846 | (120 | ) | 29,726 | |||||||||||||||||||||||||
Net sales | 460,629 | 1,942 | 462,571 | ||||||||||||||||||||||||||
Cost of sales | 90,461 | 6,632 | 97,093 | ||||||||||||||||||||||||||
Gross profit | 370,168 | (4,690 | ) | 365,478 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,835 | (4,722 | ) | 196,113 | |||||||||||||||||||||||||
General and administrative | 72,912 | 98 | 73,010 | ||||||||||||||||||||||||||
Research and development | 27,958 | — | 27,958 | ||||||||||||||||||||||||||
Amortization of intangible assets | 2,213 | 200 | 2,413 | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions (Note 17) | — | — | — | ||||||||||||||||||||||||||
303,918 | (4,424 | ) | 299,494 | ||||||||||||||||||||||||||
Operating income | 66,250 | (266 | ) | 65,984 | |||||||||||||||||||||||||
Other income and (expense) | |||||||||||||||||||||||||||||
Interest expense, net | (16,217 | ) | 4,930 | (11,287 | ) | ||||||||||||||||||||||||
Other expense | 331 | — | 331 | ||||||||||||||||||||||||||
(15,886 | ) | 4,930 | (10,956 | ) | |||||||||||||||||||||||||
Income before income taxes | 50,364 | 4,664 | 55,028 | ||||||||||||||||||||||||||
Income tax expense | (22,606 | ) | (1,425 | ) | (24,031 | ) | |||||||||||||||||||||||
Net income from continuing operations, net of tax | 27,758 | 3,239 | 30,997 | ||||||||||||||||||||||||||
Discontinued operations (Note 16) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | — | — | — | ||||||||||||||||||||||||||
Gain on sale of vascular operations, net of tax (Note 22) | 12,019 | (3,498 | ) | 8,521 | |||||||||||||||||||||||||
Income from discontinued operations | 10,015 | (4,926 | ) | 5,089 | |||||||||||||||||||||||||
Income tax expense | (5,584 | ) | 5,273 | (311 | ) | ||||||||||||||||||||||||
Net income from discontinued operations, net of tax | 16,450 | (3,151 | ) | 13,299 | |||||||||||||||||||||||||
Net income | $ | 44,208 | 88 | $ | 44,296 | ||||||||||||||||||||||||
Net income per common share—basic: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 1.58 | 0.18 | $ | 1.76 | ||||||||||||||||||||||||
Net income from discontinued operations, net of tax | 0.93 | (0.17 | ) | 0.76 | |||||||||||||||||||||||||
Net income per common share—basic | $ | 2.51 | 0.01 | $ | 2.52 | ||||||||||||||||||||||||
Net income per common share—diluted: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 1.55 | 0.18 | $ | 1.73 | ||||||||||||||||||||||||
Net income from discontinued operations, net of tax | 0.92 | (0.18 | ) | 0.74 | |||||||||||||||||||||||||
Net income per common share—diluted: | $ | 2.47 | — | $ | 2.47 | ||||||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 17,601,956 | — | 17,601,956 | ||||||||||||||||||||||||||
Diluted | 17,913,545 | — | 17,913,545 | ||||||||||||||||||||||||||
Other comprehensive income (loss), before tax: | |||||||||||||||||||||||||||||
Translation adjustment | $ | (1,710 | ) | 393 | $ | (1,317 | ) | ||||||||||||||||||||||
Unrealized loss on derivative instrument | (126 | ) | — | (126 | ) | ||||||||||||||||||||||||
Other comprehensive loss, before tax | (1,836 | ) | 393 | (1,443 | ) | ||||||||||||||||||||||||
Income tax benefit related to components of other comprehensive income | 36 | — | 36 | ||||||||||||||||||||||||||
Other comprehensive loss, net of tax | (1,800 | ) | 393 | (1,407 | ) | ||||||||||||||||||||||||
Comprehensive income | $ | 42,408 | 481 | $ | 42,889 | ||||||||||||||||||||||||
Inventories
Inventories | 12 Months Ended | ||||||||
Dec. 31, 2012 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
3 | Inventories | ||||||||
December 31, | |||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||
(Restated) | (Restated) | ||||||||
Raw materials | $ | 7,623 | $ | 9,894 | |||||
Work-in-process | 7,886 | 5,606 | |||||||
Finished products | 28,308 | 27,142 | |||||||
Field inventory | 22,629 | 23,237 | |||||||
Consignment inventory | 6,155 | 6,981 | |||||||
Deferred cost of sales | 10,772 | 8,668 | |||||||
$ | 83,373 | $ | 81,528 | ||||||
Field inventory represents immediately saleable finished products that are in the possession of the Company’s direct sales representatives. Consignment inventory represents immediately saleable finished products located at third party customers, such as distributors and hospitals. Deferred cost of sales result from transactions where the Company has shipped product or performed services for which all revenue recognition criteria have not yet been met. Once all revenue recognition criteria have been met, the revenues and associated cost of sales are recognized. |
Property_plant_and_equipment
Property, plant and equipment | 12 Months Ended | ||||||||
Dec. 31, 2012 | |||||||||
Property Plant And Equipment [Abstract] | ' | ||||||||
Property, plant and equipment | ' | ||||||||
4 | Property, plant and equipment | ||||||||
December 31, | |||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||
(Restated) | (Restated) | ||||||||
Cost | |||||||||
Buildings | $ | 3,911 | $ | 3,829 | |||||
Plant, equipment and instrumentation | 120,982 | 104,782 | |||||||
Furniture and fixtures | 5,567 | 5,697 | |||||||
130,460 | 114,308 | ||||||||
Accumulated depreciation | (76,625 | ) | (68,171 | ) | |||||
$ | 53,835 | $ | 46,137 | ||||||
Depreciation expense for the years ended December 31, 2012, 2011 and 2010 was $15.8 million, $14.3 million and $13.0 million, respectively. |
Patents_and_other_intangible_a
Patents and other intangible assets | 12 Months Ended | ||||||||
Dec. 31, 2012 | |||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||
Patents and other intangible assets | ' | ||||||||
5 | Patents and other intangible assets | ||||||||
December 31, | |||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||
(Restated) | (Restated) | ||||||||
Cost | |||||||||
Patents | $ | 38,905 | $ | 38,893 | |||||
Trademarks—definite lived | 657 | 545 | |||||||
39,562 | 39,438 | ||||||||
Accumulated amortization | |||||||||
Patents | (31,845 | ) | (30,211 | ) | |||||
Trademarks—definite lived | (427 | ) | (381 | ) | |||||
(32,272 | ) | (30,592 | ) | ||||||
Patents and other intangible assets, net | $ | 7,290 | $ | 8,846 | |||||
Amortization expense for intangible assets is estimated to be approximately $2.3 million, $1.6 million, $1.3 million, $1.2 million, $0.8 million and $0.1 million for the periods ending December 31, 2013, 2014, 2015, 2016, 2017 and 2018 and thereafter, respectively. |
Goodwill
Goodwill | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||
Goodwill | ' | ||||||||||||
6 | Goodwill | ||||||||||||
The following table presents the changes in the net carrying value of goodwill by reportable segment: | |||||||||||||
(U.S. Dollars, in thousands) | Spine | Orthopedics | Total | ||||||||||
At December 31, 2010 | $ | 41,458 | $ | 32,140 | $ | 73,598 | |||||||
Foreign currency | (39 | ) | (465 | ) | (504 | ) | |||||||
At December 31, 2011 | 41,419 | 31,675 | 73,094 | ||||||||||
Foreign currency | 145 | 1,149 | 1,294 | ||||||||||
At December 31, 2012 | $ | 41,564 | $ | 32,824 | $ | 74,388 | |||||||
Bank_borrowings
Bank borrowings | 12 Months Ended | |
Dec. 31, 2012 | ||
Debt Disclosure [Abstract] | ' | |
Bank borrowings | ' | |
7 | Bank borrowings | |
Borrowings under the line of credit consist of borrowings in Euros used to fund international operations. The borrowings under such facility were less than $0.1 million and $1.3 million at December 31, 2012 and 2011, respectively. The weighted average interest rate on borrowings under lines of credit as of December 31, 2012 and 2011 was 3.7% and 4.0%, respectively. | ||
The Company had an unused available line of credit of €5.8 million ($7.6 million) and €6.3 million ($8.1 million) at December 31, 2012 and 2011, respectively, in its Italian line of credit. This line of credit provides the Company the option to borrow amounts in Italy at rates which are determined at the time of borrowing. This line of credit is unsecured. |
Other_current_liabilities
Other current liabilities | 12 Months Ended | ||||||||
Dec. 31, 2012 | |||||||||
Payables And Accruals [Abstract] | ' | ||||||||
Other current liabilities | ' | ||||||||
8 | Other current liabilities | ||||||||
December 31, | |||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||
(Restated) | (Restated) | ||||||||
Accrued expenses | $ | 17,452 | $ | 15,002 | |||||
Salaries, bonuses, commissions and related taxes payable | 17,915 | 22,743 | |||||||
Other payables | 4,227 | 3,091 | |||||||
$ | 39,594 | $ | 40,836 | ||||||
Longterm_debt
Long-term debt | 12 Months Ended | |
Dec. 31, 2012 | ||
Debt Disclosure [Abstract] | ' | |
Long-term debt | ' | |
9 | Long-term debt | |
On August 30, 2010, the Company’s wholly-owned U.S. holding company, Orthofix Holdings, Inc. (“Orthofix Holdings”) entered into a Credit Agreement (the “Credit Agreement”) with certain domestic direct and indirect subsidiaries of the Company (the “Guarantors”), JPMorgan Chase Bank, N.A., as Administrative Agent, RBS Citizens, N.A., as Syndication Agent, and certain lender parties thereto. | ||
The Credit Agreement provides for a five year, $200.0 million secured revolving credit facility (the “Revolving Credit Facility”), and a five year, $100.0 million secured term loan facility (the “Term Loan Facility”, and together with the Revolving Credit Facility, the “Credit Facilities”). Orthofix Holdings has the ability to increase the amount of the Credit Facilities by an aggregate amount of up to $50.0 million upon satisfaction of certain conditions. | ||
In May 2012, the Company used a portion of the proceeds from the sale of Breg, Inc. (“Breg”) (see Note 16) to repay in full the remaining $87.5 million balance on the Term Loan Facility and pay down $57.5 million of amounts outstanding under the Revolving Credit Facility. This use of proceeds was required by the lenders’ consent dated April 23, 2012 to the Credit Agreement. As a result of the sale of Breg, Breg ceased to be a subsidiary of the Company and, therefore, Breg was released as a credit party under the Credit Agreement. Additionally, the Company paid $20 million in June and $20 million in September 2012 to reduce amounts outstanding under the Revolving Credit Facility. As a result, at December 31, 2012, the Term Loan Facility had been repaid in full and there was $20 million outstanding under the Revolving Credit Facility. As of December 31, 2011, the Company had $91.3 million outstanding under the Term Loan Facility and $117.4 million outstanding under the Revolving Credit Facility. Borrowings under the Credit Facilities bear interest at a floating rate, which is, at Orthofix Holdings’ option, either the London Inter-Bank Offered Rate (“LIBOR”) plus an applicable margin or a base rate (as defined in the Credit Agreement) plus an applicable margin (in each case subject to adjustment based on financial ratios). Such applicable margin will be up to 3.25% for LIBOR borrowings and up to 2.25% for base rate borrowings depending upon a measurement of the consolidated leverage ratio with respect to the immediately preceding four fiscal quarters. As of December 31, 2012, the entire Revolving Credit Facility was at the LIBOR rate plus a margin of 2.5%. As of December 31, 2011, the entire Term Loan Facility and $100 million of the Revolving Credit Facility was at the LIBOR rate plus a margin of 3.0%. As of December 31, 2011, the remaining $17.4 million of the Revolving Credit Facility was at a base rate (as defined in the Credit Agreement) plus a margin of 2.0%. The effective interest rate on the Credit Facilities as of December 31, 2012 and 2011 was 2.7% and 3.4%, respectively. | ||
Outstanding principal on the Revolving Credit Facility is due on August 30, 2015. | ||
Borrowings under the Revolving Credit Facility, which may be made in the future, will be used for working capital, capital expenditures and other general corporate purposes of Orthofix Holdings and its subsidiaries. The Guarantors have guaranteed repayment of Orthofix Holdings’ obligations under the Credit Agreement. The obligations of Orthofix Holdings and each of the Guarantors with respect to the Credit Facilities are secured by a pledge of substantially all of the assets of Orthofix Holdings and each of the Guarantors. | ||
The Credit Agreement, as amended, requires Orthofix Holdings and the Company to comply with coverage ratios on a consolidated basis and contains affirmative and negative covenants, including limitations on additional debt, liens, investments and acquisitions. The Credit Agreement, as amended, also includes events of default customary for facilities of this type. Upon the occurrence of an event of default, all outstanding loans may be accelerated and/or the lenders’ commitments terminated. The Company was in compliance with the affirmative and negative covenants at December 31, 2012 and there were no events of default. | ||
On August 14, 2013, the Company and certain required lender parties to the Credit Agreement entered into a Limited Waiver (the “Limited Waiver”). Under the Limited Waiver, the lenders under the Credit Agreement (the “Lenders”) collectively waived requirements under the Credit Agreement that the Company deliver quarterly financial statements with respect to the fiscal quarters ending on June 30, 2013 and September 30, 2013, and related financial covenant certificates, until the earlier of (i) March 31, 2014 or (ii) the date that is one day after such financial statements are publicly filed or released. In addition, the Limited Waiver provided that the restatement of the Company’s financial statements for any period ending on or before March 31, 2013 will not constitute a default or event or default provided that within one business day after the public release or filing of such restated financial statements, the Company delivers corrected financial statements and compliance certificates with respect to such restated periods and immediately pay any additional interest and other fees that would have been owed had applicable interest and fees originally been calculated based on the restated financial statements. | ||
Certain subsidiaries of the Company have restrictions on their ability to pay dividends or make intercompany loan advances pursuant to the Company’s Credit Facilities. The net assets of Orthofix Holdings and its subsidiaries are restricted for distributions to the parent company. Domestic subsidiaries of the Company, as parties to the credit agreement, have access to these net assets for operational purposes. | ||
The amount of restricted net assets of Orthofix Holdings and its subsidiaries as of December 31, 2012 and 2011 is $213.4 million and $162.7 million, respectively. In addition, the Credit Agreement restricts the Company and subsidiaries that are not parties to the Credit Facilities from access to cash held by Orthofix Holdings, Inc. and its subsidiaries. All of the Company’s subsidiaries that are parties to the Credit Agreement have access to this cash for operational and debt repayment purposes. The amount of restricted cash of the Company as of December 31, 2012 and 2011 was $21.3 million and $45.5 million, respectively. | ||
In conjunction with obtaining the Credit Facilities and the Credit Agreement, as amended, the Company incurred debt issuance costs of $5 million which includes $0.8 million of costs related to the May 2011 amendment. These costs are being amortized using the effective interest method over the life of the Credit Facilities. In conjunction with the Term Loan Facility repayment in May 2012, the Company wrote off $0.8 million of the related debt issuance costs. As of December 31, 2012 and 2011, debt issuance costs, net of accumulated amortization, related to the Credit Agreement were $1.8 million and $3.5 million, respectively. |
Derivative_instruments
Derivative instruments | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ' | ||||||||||||
Derivative instruments | ' | ||||||||||||
10 | Derivative instruments | ||||||||||||
The tables below disclose the types of derivative instruments the Company owns, the classifications and fair values of these instruments within the balance sheet, and the amount of gain (loss) recognized in other comprehensive income (loss) (“OCI”) or net income (loss): | |||||||||||||
(U.S. Dollars, in thousands) | Fair value: favorable | Balance sheet location | |||||||||||
(unfavorable) | |||||||||||||
As of December 31, 2012 | |||||||||||||
Cross-currency swap | $ | 305 | Other long-term assets | ||||||||||
As of December 31, 2011 | |||||||||||||
Cross-currency swap | $ | 1,011 | Other long-term assets | ||||||||||
For the year ended | |||||||||||||
December 31, | |||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||
Interest rate swap gain recognized in net income (loss) | $ | — | $ | — | $ | 1,254 | |||||||
Cross-currency swap gain (loss) recorded in other comprehensive income (loss), net of taxes | 263 | (437 | ) | (90 | ) | ||||||||
Cross-currency swap | |||||||||||||
On September 30, 2010, the Company entered into a cross-currency swap agreement (the “replacement swap agreement”) with JPMorgan Chase Bank and Royal Bank of Scotland PLC (the “counterparties”) to manage its cash flows related to foreign currency exposure for a portion of the Company’s intercompany receivable of a U.S. dollar functional currency subsidiary that is denominated in Euro. | |||||||||||||
Under the terms of the swap agreement, the Company pays Euros based on a €28.7 million notional value and a fixed rate of 5.00% and receives U.S. dollars based on a notional value of $39 million and a fixed rate of 4.635%. The expiration date is December 30, 2016, the date upon which the underlying intercompany debt, to which the swap agreement applies, matures. The swap agreement is designated as a cash flow hedge and therefore the Company recognized an unrealized gain (loss) on the change in fair value, net of tax, within other comprehensive income. | |||||||||||||
Interest rate swap | |||||||||||||
In June 2008, the Company entered into a three-year fully amortizable interest rate swap agreement (the “Swap”) with a notional amount of $150.0 million and an expiration date of June 30, 2011. On June 29, 2010, the Company settled the Swap with the financial institution holder of the derivative instrument, which resulted in a $1.3 million gain in 2010. |
Fair_value_measurements
Fair value measurements | 12 Months Ended | ||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair value measurements | ' | ||||||||||||||||
11 | Fair value measurements | ||||||||||||||||
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 liability in an orderly transaction between market participants on the measurement date. Non-financial assets and liabilities of the Company measured at fair value include any long-lived assets or equity method investments that are impaired in a currently reported period. The authoritative guidance also describes three levels of inputs that may be used to measure fair value: | |||||||||||||||||
Level 1— | quoted prices in active markets for identical assets and liabilities | ||||||||||||||||
Level 2— | observable inputs other than quoted prices in active markets for identical assets and liabilities | ||||||||||||||||
Level 3— | unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions | ||||||||||||||||
As of December 31, 2012, the Company’s financial instruments included cash equivalents, restricted cash, accounts receivable, short-term bank borrowings, accounts payable, long-term secured debt, and a cross currency derivative contract. Cash equivalents consist of short-term, highly liquid, income-producing investments, all of which have original maturities of 90 days or less, including money market funds. The carrying value of restricted cash, accounts receivable, short-term bank borrowings and accounts payable approximate fair value due to the short-term maturities of these instruments. The Company’s credit facilities carry a floating rate of interest, and therefore, the carrying value is considered to approximate the fair value. | |||||||||||||||||
The Company’s cross-currency derivative instrument is the only financial instrument recorded at fair value on a recurring basis. This instrument consists of an over-the-counter contract, which is not traded on a public exchange. The fair value of the swap contract is determined based on inputs that are readily available in public markets or can be derived from information available in publicly quoted markets. Therefore, the Company has categorized the swap contract as a Level 2 derivative financial instrument. The Company also considers counterparty credit risk and its own credit risk in its determination of all estimated fair values. The Company has consistently applied these valuation techniques in all periods presented. | |||||||||||||||||
The fair value of the Company’s financial assets and liabilities on a recurring basis were as follows: | |||||||||||||||||
(U.S. Dollars, in thousands) | Balance | Level 1 | Level 2 | Level 3 | |||||||||||||
December 31, | |||||||||||||||||
2012 | |||||||||||||||||
Derivative Financial Instruments (1) | |||||||||||||||||
Cash Flow Hedges | |||||||||||||||||
Cross currency hedge | $ | 305 | $ | — | $ | 305 | $ | — | |||||||||
(U.S. Dollars, in thousands) | Balance | Level 1 | Level 2 | Level 3 | |||||||||||||
December 31, | |||||||||||||||||
2011 | |||||||||||||||||
Derivative Financial Instruments (1) | |||||||||||||||||
Cash Flow Hedges | |||||||||||||||||
Cross currency hedge | $ | 1,011 | $ | — | $ | 1,011 | $ | — | |||||||||
-1 | See Note 10, “Derivative Instruments”. |
Commitments
Commitments | 12 Months Ended | ||||
Dec. 31, 2012 | |||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||
Commitments | ' | ||||
12 | Commitments | ||||
Leases | |||||
The Company has entered into operating leases for facilities and equipment. These leases are non-cancellable and typically do not contain renewal options. Certain leases contain rent escalation clauses for which the Company recognizes the expense on a straight-line basis. Rent expense under the Company’s operating leases for the years ended December 31, 2012, 2011 and 2010 was approximately $4.1 million, $4.8 million and $6.8 million, respectively. Future minimum lease payments under operating leases, net of amounts to be received under sub-leases, as of December 31, 2012 are as follows: | |||||
(U.S. Dollars in thousands) | |||||
2013 | $ | 3,340 | |||
2014 | 2,992 | ||||
2015 | 2,816 | ||||
2016 | 2,677 | ||||
2017 | 2,620 | ||||
Thereafter | 2,624 | ||||
Total | $ | 17,069 | |||
Business_segment_information
Business segment information | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||||||||||
Business segment information | ' | ||||||||||||||||||||||||
13 | Business segment information | ||||||||||||||||||||||||
The Company’s segment information is prepared on the same basis that management reviews the financial information for operational decision making purposes. At this time, the Company’s Chief Operating Decision Maker (the “CODM”) only uses GBU reporting for Sales and Operating Income to assess operating performance. Items below operating income are not considered when measuring the profitability of a segment. Goodwill is also assigned to specific GBUs. The Company neither discretely allocates assets, other than goodwill, to its operating segments nor evaluates the operating segments using discrete asset information. On May 24, 2012 as a result of the sale of its sports medicine business, the Company began managing its business by its two GBUs, which are comprised of Spine and Orthopedics supported by Corporate activities and represent the current segments for which the Company’s Chief Operating Decision Maker reviews financial information and makes resource allocation decisions among business units. These segments are discussed below. | |||||||||||||||||||||||||
Spine | |||||||||||||||||||||||||
Spine provides a portfolio of repair and regenerative products that allow physicians to successfully treat a variety of spinal conditions. This global business unit specializes in the design, development and marketing of the Company’s spinal repair products along with regenerative stimulation and biologics products used in spine applications. Spine distributes its products through a network of distributors, sales representatives and affiliates. This global business unit uses both direct and distributor sales representatives to sell spine products to hospitals, doctors and other healthcare providers, globally. | |||||||||||||||||||||||||
Orthopedics | |||||||||||||||||||||||||
Orthopedics provides a portfolio of repair and regenerative products that allow physicians to successfully treat a variety of orthopedic conditions unrelated to spine. This global business unit specializes in the design, development and marketing of the Company’s orthopedic repair products along with regenerative stimulation and biologics products used in orthopedic applications. Orthopedics distributes its products through a network of distributors, sales representatives and affiliates. This global business unit uses both direct and distributor sales representatives to sell orthopedics products to hospitals, doctors, and other healthcare providers globally. | |||||||||||||||||||||||||
Corporate | |||||||||||||||||||||||||
Corporate activities are comprised of the operating expenses of Orthofix International N.V. and its holding company subsidiaries, along with activities not necessarily identifiable within the two GBUs. | |||||||||||||||||||||||||
Business Segments by GBU: | |||||||||||||||||||||||||
The table below presents external net sales for continuing operations by GBU reporting segment. Net sales includes product sales and marketing service fees which is comprised of sales of Trinity Evolution® in spine and orthopedic applications. | |||||||||||||||||||||||||
External Net Sales by GBU | |||||||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
Net Sales | Percent of | Net Sales | Percent of | Net Sales | Percent of | ||||||||||||||||||||
Total Net | Total Net | Total Net | |||||||||||||||||||||||
Sales | Sales | Sales | |||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | (Restated) | (Restated) | (Restated) | ||||||||||||||||||||
Spine | |||||||||||||||||||||||||
Spine Repair Implants and Regenerative Biologics | $ | 142,829 | 32 | % | $ | 124,415 | 28 | % | $ | 132,938 | 29 | % | |||||||||||||
Spine Regenerative Stimulation | 159,289 | 36 | % | 160,946 | 37 | % | 172,574 | 37 | % | ||||||||||||||||
Total Spine | 302,118 | 68 | % | 285,361 | 65 | % | 305,512 | 66 | % | ||||||||||||||||
Orthopedics | 145,463 | 32 | % | 156,610 | 35 | % | 157,059 | 34 | % | ||||||||||||||||
Total Net Sales | $ | 447,581 | 100 | % | $ | 441,971 | 100 | % | $ | 462,571 | 100 | % | |||||||||||||
The table below presents operating income (loss) from continuing operations by GBU reporting segment: | |||||||||||||||||||||||||
Operating Income (Loss) | |||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||||||||||
Spine (1) | $ | 80,528 | $ | 31,173 | $ | 78,451 | |||||||||||||||||||
Orthopedics (2) | 13,197 | 3,779 | 7,847 | ||||||||||||||||||||||
Corporate (3) | (17,089 | ) | (29,052 | ) | (20,314 | ) | |||||||||||||||||||
Total | $ | 76,636 | $ | 5,900 | $ | 65,984 | |||||||||||||||||||
-1 | For 2011, the operating income for the Spine GBU included $43.1 million of expenses in connection with charges related to U.S. Government resolutions. | ||||||||||||||||||||||||
-2 | For 2011, the operating income for the Orthopedics GBU included $6.5 million of expenses in connection with charges related to U.S. Government resolutions. | ||||||||||||||||||||||||
-3 | For 2011, the operating loss for the Corporate GBU included $7.5 million of expenses in connection with charges related to U.S. Government inquiries and $3.2 million of senior management succession charges. | ||||||||||||||||||||||||
The following table presents depreciation and amortization for continuing operations by GBU reporting segment: | |||||||||||||||||||||||||
Depreciation and amortization by GBU | |||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||||||||||
Spine | $ | 12,260 | $ | 11,091 | $ | 8,973 | |||||||||||||||||||
Orthopedics | 5,605 | 5,506 | 6,282 | ||||||||||||||||||||||
Corporate | 280 | 263 | 126 | ||||||||||||||||||||||
Total | $ | 18,145 | $ | 16,860 | $ | 15,381 | |||||||||||||||||||
Geographical information | |||||||||||||||||||||||||
Analysis of net sales by geographic destination: | |||||||||||||||||||||||||
Net Sales by Geographic Destination | |||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||||||||||
U.S. | $ | 334,624 | $ | 328,585 | $ | 340,328 | |||||||||||||||||||
International: | |||||||||||||||||||||||||
U.K. | 8,431 | 8,206 | 12,509 | ||||||||||||||||||||||
Italy | 18,742 | 17,447 | 19,181 | ||||||||||||||||||||||
Brazil | 31,166 | 34,424 | 31,112 | ||||||||||||||||||||||
Other | 54,618 | 53,309 | 59,441 | ||||||||||||||||||||||
Total international | 112,957 | 113,386 | 122,243 | ||||||||||||||||||||||
Total net sales | $ | 447,581 | $ | 441,971 | $ | 462,571 | |||||||||||||||||||
Analysis of property, plant and equipment by geographic area: | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||||||||||||||||||
(Restated) | (Restated) | ||||||||||||||||||||||||
U.S. | $ | 39,554 | $ | 33,575 | |||||||||||||||||||||
Italy | 7,617 | 7,663 | |||||||||||||||||||||||
U.K. | 1,402 | 1,449 | |||||||||||||||||||||||
Brazil | 3,421 | 2,532 | |||||||||||||||||||||||
Others | 1,841 | 918 | |||||||||||||||||||||||
Total | $ | 53,835 | $ | 46,137 | |||||||||||||||||||||
Income_taxes
Income taxes | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||||||||||||||
Income taxes | ' | ||||||||||||||||||||||||
14 | Income taxes | ||||||||||||||||||||||||
The provision for (benefit from) income taxes on continuing operations in the accompanying consolidated statements of operations consists of the following: | |||||||||||||||||||||||||
Year Ended | |||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||||||||||
U.S. | |||||||||||||||||||||||||
Current | $ | 17,897 | $ | 25,148 | $ | 19,336 | |||||||||||||||||||
Deferred | 1,788 | (12,657 | ) | 2,282 | |||||||||||||||||||||
Total U.S | 19,685 | 12,491 | 21,618 | ||||||||||||||||||||||
Non-U.S. | |||||||||||||||||||||||||
Current | 4,609 | 2,735 | 253 | ||||||||||||||||||||||
Deferred | 844 | (1,061 | ) | 2,160 | |||||||||||||||||||||
5,453 | 1,674 | 2,413 | |||||||||||||||||||||||
Total tax expense | $ | 25,138 | $ | 14,165 | $ | 24,031 | |||||||||||||||||||
The tax effects of the significant temporary differences, which comprise the deferred tax assets and liabilities, are as follows: | |||||||||||||||||||||||||
Year Ended | |||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||||||||||||||||||
(Restated) | (Restated) | ||||||||||||||||||||||||
Intangible assets and goodwill | $ | 5,346 | $ | 5,300 | |||||||||||||||||||||
Inventories and related reserves | 14,020 | 13,756 | |||||||||||||||||||||||
Deferred revenue and cost of sales | 11,682 | 7,631 | |||||||||||||||||||||||
Other accruals and reserves | 3,868 | 10,287 | |||||||||||||||||||||||
Accrued compensation | 3,817 | 4,444 | |||||||||||||||||||||||
Allowance for doubtful accounts | 3,718 | 4,029 | |||||||||||||||||||||||
Accrued interest | 18,229 | 16,123 | |||||||||||||||||||||||
Net operating loss carryforwards | 27,231 | 20,849 | |||||||||||||||||||||||
Other, net | 539 | (349 | ) | ||||||||||||||||||||||
88,450 | 82,070 | ||||||||||||||||||||||||
Valuation allowance | (26,361 | ) | (19,124 | ) | |||||||||||||||||||||
Deferred tax asset | $ | 62,089 | $ | 62,946 | |||||||||||||||||||||
Withholding taxes | (11,456 | ) | (9,778 | ) | |||||||||||||||||||||
Property, plant and equipment | (9,758 | ) | (9,892 | ) | |||||||||||||||||||||
Deferred tax liability | (21,214 | ) | (19,670 | ) | |||||||||||||||||||||
Net deferred tax assets | $ | 40,875 | $ | 43,276 | |||||||||||||||||||||
The valuation allowance as of December 31, 2012 and 2011 was $26.4 million and $19.1 million, respectively. The net increase in the valuation allowance of $7.3 million during the year principally relates to certain current period foreign losses not benefitted. The valuation allowance is attributable to net operating loss carryforwards and certain temporary differences in certain foreign jurisdictions, the benefit for which is dependent upon the generation of future taxable income in those foreign jurisdictions. 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. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. 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 the Company will realize the benefits of these temporary differences, net of the existing valuation allowances at December 31, 2012. | |||||||||||||||||||||||||
The Company has state net operating loss carryforwards of approximately $21.9 million that begin to expire in 2013. The Company has net operating losses of foreign taxing jurisdictions of approximately $102.7 million with the majority of the losses related to the Company’s Netherlands operations expiring in various amounts in tax years beginning in 2013. The Company has provided a valuation allowance against a significant portion of these net operating loss carryforwards since it does not believe that this deferred tax asset can be realized prior to expiration. | |||||||||||||||||||||||||
The rate reconciliation for continuing operations presented below is based on the U.S. federal income tax rate, rather than the parent company’s country of domicile tax rate. Management believes, given the large proportion of taxable income earned in the United States, such disclosure is more meaningful. | |||||||||||||||||||||||||
(US$ in thousands, except percentages) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
Amount | Percent | Amount | Percent | Amount | Percent | ||||||||||||||||||||
(Restated) | (Restated) | (Restated) | (Restated) | (Restated) | (Restated) | ||||||||||||||||||||
Statutory U.S. federal income tax rate | $ | 24,565 | 35 | % | $ | (719 | ) | 35 | % | $ | 19,261 | 35 | % | ||||||||||||
State taxes, net | 1,708 | 2.4 | % | 1,896 | (92.4 | )% | 2,051 | 3.7 | % | ||||||||||||||||
Foreign rate differential | (3,115 | ) | (4.4 | )% | 1,585 | (77.2 | )% | 251 | 0.5 | % | |||||||||||||||
Valuation allowance—foreign losses | 6,183 | 8.8 | % | 4,882 | -237.8 | % | 3,497 | 6.4 | % | ||||||||||||||||
SRL Intangible | (2,214 | ) | (3.2 | )% | (2,421 | ) | 117.9 | % | (2,607 | ) | (4.7 | )% | |||||||||||||
Domestic manufacturing deduction | (1,694 | ) | (2.4 | )% | (1,703 | ) | 82.9 | % | (1,529 | ) | (2.8 | )% | |||||||||||||
Withholding Taxes | 1,679 | 2.4 | % | 1,676 | (81.6 | )% | 1,687 | 3.1 | % | ||||||||||||||||
Settlement of U.S. Government resolutions | (1,260 | ) | (1.8 | )% | 9,520 | (463.7 | )% | — | — | % | |||||||||||||||
Other items, net | (714 | ) | (1.0 | )% | (551 | ) | 26.9 | % | 1,420 | 2.5 | % | ||||||||||||||
Income tax expense/effective rate | $ | 25,138 | 35.8 | % | $ | 14,165 | (690.0 | )% | $ | 24,031 | 43.7 | % | |||||||||||||
The effective tax rate of 35.8% for 2012 was impacted by change in the estimate of the tax deduction associated with the settlement of the U.S. Government investigation of the Company’s bone growth stimulation business. The income tax expense and effective tax rate for the year ended 2011 reflects a disproportionate ratio to the $25.1 million of income tax expense and effective tax rate of 35.8% for 2012. The Company did not record tax benefit on certain expenses associated with the Company’s estimate of the charges related to U.S. Government resolutions. The effective tax rate was approximately 42.0% in 2012 and 149.1% in 2011 excluding the impact of the charges related to the U.S. Government resolutions and the foreign rate differential. | |||||||||||||||||||||||||
On January 2, 2013, the American Taxpayer Relief Act of 2012 (“Act”) was enacted. The Act provides tax relief for businesses by reinstating certain tax benefits and credits retroactively to January 1, 2012. There are several provisions of the Act that impact the Company, most notably the extension of the Research and Development credit. Income tax accounting rules require tax law changes to be recognized in the period of enactment; as such, the associated tax benefits of the Act will be recognized in the Company’s provision for income taxes in the first quarter of 2013. | |||||||||||||||||||||||||
The Company’s unrecognized tax benefit was $1.2 million and $0.6 million for the years ended December 31, 2012 and 2011, respectively. The Company recognizes potential accrued interest and penalties related to unrecognized tax benefits within its global operations in income tax expense. The Company had approximately $0.8 million and $0.6 million accrued for payment of interest and penalties as of December 31, 2012 and 2011, respectively. | |||||||||||||||||||||||||
The entire amount of unrecognized tax benefits, including interest, would favorably impact the Company’s effective tax rate if recognized. As of December 31, 2012, the Company does not expect the amount of unrecognized tax benefits to change significantly over the next twelve months. | |||||||||||||||||||||||||
A reconciliation of the gross unrecognized tax benefits (excluding interest and penalties) for the years ended December 31, 2012 and December 31, 2011 follows: | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||||||||||||||||||
(Restated) | (Restated) | ||||||||||||||||||||||||
Balance as of January 1, | $ | 610 | $ | 569 | |||||||||||||||||||||
Additions for current year tax positions | 793 | 86 | |||||||||||||||||||||||
Decreases for prior year tax positions | (106 | ) | (17 | ) | |||||||||||||||||||||
Expiration of statutes | (108 | ) | (28 | ) | |||||||||||||||||||||
Balance as of December 31, | $ | 1,189 | $ | 610 | |||||||||||||||||||||
The Company files a consolidated income tax return in the U.S. federal jurisdiction, the U.K., Italy and numerous consolidated and separate income tax returns in many state and other foreign jurisdictions. The statute of limitations with respect to federal tax authorities is closed for years prior to December 31, 2009. The statute of limitations for the various state tax filings is closed in most instances for the years prior to December 31, 2008. The statute of limitations with respect to the major foreign tax filing jurisdictions is closed for years prior to December 31, 2007. | |||||||||||||||||||||||||
The Company’s intention is to reinvest the total amount of its unremitted foreign earnings (residing outside Curaçao) in the local jurisdiction, to the extent they are generated and available, or to repatriate the earnings only when tax-effective. As an entity incorporated in Curaçao, “foreign subsidiaries” refer to both U.S. and non-U.S. subsidiaries. Furthermore, only income sourced in the U.S. is subject to U.S. income tax. Unremitted foreign earnings increased from $285.3 million at December 31, 2011 to $292 million at December 31, 2012. The $292 million includes $293.8 million in U.S subsidiaries. It is not practicable to determine the amounts of net additional income tax that may be payable if such earnings were repatriated. The Company does not anticipate any impact on income tax liabilities since earnings are permanently reinvested for both U.S and non-U.S. subsidiaries. | |||||||||||||||||||||||||
Total cash and cash equivalents at December 31, 2012 were $52.3 million, of which $21.3 million is restricted under the senior secured credit agreement for use in the U.S. and is therefore classified as restricted cash on the balance sheet. The Company’s U.S. business generates sufficient cash flow and has borrowing capacity in the United States to fund its U.S. operations. Cash and cash equivalents of $31 million at December 31, 2012 was held by non-U.S. subsidiaries and is permanently reinvested for use in non-U.S. operations. |
Related_parties
Related parties | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Related Party Transactions [Abstract] | ' | ||||||||||||
Related parties | ' | ||||||||||||
15 | Related parties | ||||||||||||
The following related party balances and transactions as of and for the three years ended December 31, 2012, among the Company and other companies in which directors or executive officers have an interest, are reflected in the consolidated financial statements. The Company bought components related to the A-V Impulse ® System and Laryngeal Mask products from a related party in which a former board member, who retired in May 2010, had a beneficial minority interest. These products were no longer purchased by the Company in 2010. Additionally, OrthoPro, Inc. and Superior Medical Equipment, independent distributors for Breg, Inc., are owned by the son of this former board member. The following table summarizes these related party balances and transactions as of and for the years ended December 31, 2012, 2011 and 2010. | |||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||
Sales | $ | — | $ | 479 | $ | 3,081 | |||||||
Purchases | — | — | 4,911 | ||||||||||
Accounts payable | — | — | 334 | ||||||||||
Accounts receivable | — | 106 | 676 |
Sale_of_Breg_and_Disposition_o
Sale of Breg and Disposition of Sports Medicine GBU | 12 Months Ended | ||||
Dec. 31, 2012 | |||||
Discontinued Operations And Disposal Groups [Abstract] | ' | ||||
Sale of Breg and Disposition of Sports Medicine GBU | ' | ||||
16 | Sale of Breg and Disposition of Sports Medicine GBU | ||||
On April 23, 2012, the Company’s subsidiary Orthofix Holdings and Breg entered into a stock purchase agreement (the “SPA”) with Breg Acquisition Corp. (“Buyer”), a newly formed affiliate of Water Street Healthcare Partners II, L.P., pursuant to which Buyer agreed to acquire from Orthofix Holdings all the outstanding shares of Breg, subject to the terms and conditions contained therein (the “Transaction”). Under the terms of the SPA, upon closing of the sale, Orthofix Holdings and the Company agreed to indemnify Buyer with respect to certain specified matters, including the government investigation and product liability matters regarding a previously owned infusion pump product line, and pre-closing sales of cold therapy units and certain post-closing sales of cold therapy units. (See “Matters Related to the Company’s former Breg Subsidiary and Possible Indemnification Obligations under Note 17.) On May 24, 2012 (the “Closing Date”), Orthofix Holdings completed the sale of all of the outstanding shares of Breg for $157.5 million in cash. After adjustments for working capital and indebtedness in accordance with the terms of the SPA, Orthofix Holdings used $145 million of the net proceeds to prepay outstanding Company indebtedness, as required by a lender consent received in connection with the Company’s existing Credit Agreement. As a result of the closing of this Transaction, Breg ceased to be a subsidiary of the Company and, therefore, Breg was released as a credit party under the Credit Agreement. The Company also agreed to enter into certain transition arrangements at the closing, including a transition services agreement pursuant to which the Company agreed to continue to provide administrative operational support for a period of up to twelve months. As a result of the sale of Breg, the Company completed its exit from the Sports Medicine GBU, of which Breg was a significant component. | |||||
The portion of indemnification related to post closing claims related to post-closing sales of cold therapy has created a guarantee under ASC Topic 460, Guarantees, and the fair value of the liability has been recorded under the initial recognition criteria in the amount of $2 million at the Closing Date of the transaction. The Company will amortize the fair value of the noncontingent liability ratably over the period of indemnification which is three years. The Company’s obligations under this guarantee were approximately $1.6 million as of December 31, 2012. | |||||
Gain on Sale of Discontinued Operations | |||||
The following table presents the value of the asset disposition, proceeds received, net of various working capital adjustments and indebtedness and net gain on sale of Breg as shown in the consolidated statement of operations for the year ended December 31, 2012: | |||||
(U.S. Dollars, in thousands) | Total | ||||
Cash proceeds | $ | 157,500 | |||
Less: | |||||
Working Capital | (7,093 | ) | |||
Transaction related expenses | (4,276 | ) | |||
Fair Value of Indemnification | (2,000 | ) | |||
Tangible assets | (8,309 | ) | |||
Intangible assets | (28,164 | ) | |||
Goodwill | (106,200 | ) | |||
Gain on sale of Breg | 1,458 | ||||
Income tax expense | (113 | ) | |||
Gain on sale of Breg, net of taxes | $ | 1,345 | |||
The Sports Medicine GBU contributed $44 million and $108.9 million of net sales in the years ended December 31, 2012 and 2011, respectively. The Sports Medicine GBU had $2.9 million of operating losses and $1.2 million of operating income in the years ended December 31, 2012 and 2011, respectively. The financial information above includes the financial results of Breg operations up to the date of sale. | |||||
The Company’s consolidated financial statements and related footnote disclosures reflect the Sports Medicine GBU as discontinued operations. Income (loss) associated with the Sports Medicine GBU, net of applicable income taxes, is shown as income (loss) from discontinued operations for all periods presented. In addition, the assets and liabilities of the discontinued entity have been reclassified and presented as assets held for sale and liabilities held for sale in the Company’s balance sheet as of December 31, 2011. | |||||
The assets and liabilities of the discontinued operations are as follows: | |||||
(U.S. Dollars, in thousands) | December 31, | ||||
2011 | |||||
(Restated) | |||||
Assets Held for Sale | |||||
Restricted cash | $ | 1,629 | |||
Trade accounts receivable, less allowance | 13,711 | ||||
Inventories, net | 8,277 | ||||
Property, plant and equipment, net | 8,756 | ||||
Intangible assets, net | 29,279 | ||||
Goodwill | 106,279 | ||||
Deferred income taxes, prepaid expenses and other assets | 3,254 | ||||
Assets Held for Sale | $ | 171,185 | |||
Liabilities Held for Sale | |||||
Trade accounts payable | 3,616 | ||||
Deferred income taxes and other liabilities | 19,060 | ||||
Liabilities Held for Sale | $ | 22,676 | |||
Contingencies
Contingencies | 12 Months Ended | |
Dec. 31, 2012 | ||
Commitments And Contingencies Disclosure [Abstract] | ' | |
Contingencies | ' | |
17 | Contingencies | |
We are party to outstanding legal proceedings, investigations and claims as described below. We believe that it is unlikely that the outcome of each of these matters, including the matters discussed below, will have a material adverse effect on our Company and its subsidiaries as a whole, notwithstanding that the unfavorable resolution of any matter may have a material effect on our net earnings (if any) in any particular quarter. However, we cannot predict with any certainty the final outcome of any legal proceedings, investigations (including any settlement discussions with the government seeking to resolve such investigations) or claims made against us as described in the paragraphs below, and there can be no assurance that the ultimate resolution of any such matter will not have a material adverse impact on our consolidated financial position, results of operations, or cash flows. | ||
We record accruals for certain outstanding legal proceedings, investigations or claims when it is probable that a liability will be incurred and the amount of the loss can be reasonably estimated. We evaluate, on a quarterly basis, developments in legal proceedings, investigations and claims that could affect the amount of any accrual, as well as any developments that would make a loss contingency both probable and reasonably estimable. When a loss contingency is not both probable and reasonably estimable, we do not accrue the loss. However, if the loss (or an additional loss in excess of the accrual) is at least a reasonable possibility and material, then we disclose a reasonable estimate of the possible loss or range of loss, if such reasonable estimate can be made. If we cannot make a reasonable estimate of the possible loss, or range of loss, then that is disclosed. | ||
The assessments of whether a loss is probable or a reasonable possibility, and whether the loss or range of loss is reasonably estimable, often involve a series of complex judgments about future events. Among the factors that we consider in this assessment are the nature of existing legal proceedings, investigations and claims, the asserted or possible damages or loss contingency (if reasonably estimable), the progress of the matter, existing law and precedent, the opinions or views of legal counsel and other advisers, the involvement of the U.S. Government and its agencies in such proceedings, our experience in similar matters and the experience of other companies, the facts available to us at the time of assessment, and how we intend to respond, or have responded, to the proceeding, investigation or claim. Our assessment of these factors may change over time as individual proceedings, investigations or claims progress. For matters where we are not currently able to reasonably estimate a range of reasonably possible loss, the factors that have contributed to this determination include the following: (i) the damages sought are indeterminate, or an investigation has not manifested itself in a filed civil or criminal complaint, (ii) the matters are in the early stages, (iii) the matters involve novel or unsettled legal theories or a large or uncertain number of actual or potential cases or parties, and/or (iv) discussions with the government or other parties in matters that may be expected ultimately to be resolved through negotiation and settlement have not reached the point where we believe a reasonable estimate of loss, or range of loss, can be made. In such instances, we believe that there is considerable uncertainty regarding the timing or ultimate resolution of such matters, including a possible eventual loss, fine, penalty or business impact, if any. | ||
In addition to the matters described in the paragraphs below, in the normal course of our business, we are involved in various lawsuits from time to time and may be subject to certain other contingencies. To the extent losses related to these contingencies are both probable and reasonably estimable, we accrue appropriate amounts in the accompanying financial statements and provide disclosures as to the possible range of loss in excess of the amount accrued, if such range is reasonably estimable. We believe losses are individually and collectively immaterial as to a possible loss and range of loss. | ||
Matters Related to the Audit Committee’s Review, the Restatement of Certain of the Company’s Consolidated Financial Statements, the State of the Company’s Internal Control Over Financial Reporting and the Company’s Failure to Timely File Periodic Reports with the SEC | ||
Audit Committee Review | ||
In July 2013, the Company’s Audit Committee began conducting an independent review, with the assistance of outside professionals, of certain accounting matters. This review resulted in the decision to restate certain of the Company’s previously filed consolidated financial statements. As a result of this review and the restatement of certain of the Company’s consolidated financial statements, the Company’s Quarterly Reports on Form 10-Q for the quarterly periods ended June 30, 2013 and September 30, 2013 were not timely filed. The Company is filing its Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2013 on the date hereof, and expects to file its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2013 on the date following the date hereof. The Company also currently expects to file its Annual Report on Form 10-K for the year ended December 31, 2013 (which is otherwise due under SEC rules on March 17, 2014) by March 31, 2014. | ||
SEC Enforcement Staff Review | ||
In connection with the initiation of the audit committee review, the Company initiated contact with the staff of the Division of Enforcement of the Securities and Exchange Commission (the “SEC Enforcement Staff”) in July 2013 to advise them of these matters. The Audit Committee, through its counsel, has been in direct communication with the SEC Enforcement Staff regarding these matters, and both the Company and the Audit Committee are cooperating fully with the SEC Enforcement Staff’s review of these matters. The Company has received requests from the SEC Enforcement Staff for documents and other information concerning various accounting, internal controls and business practices. Such requests cover the years ended December 31, 2011 and 2012, and in some instances, prior periods. It is anticipated that the Company may receive additional requests from the SEC Enforcement Staff in the future. The Company has further provided notice concerning these matters to the Office of Inspector General of the U.S. Department of Health and Human Services (“HHS-OIG”) pursuant to the Company’s Corporate Integrity Agreement (“CIA”) with HHS-OIG (which CIA is described below). | ||
The Company cannot predict if, when or how this matter will be resolved or what, if any, actions the Company may be required to take as part of any resolution of these matters. Any action by the SEC, HHS-OIG or other governmental agency could result in civil or criminal sanctions against the Company and/or certain of its current and former officers, directors and employees. The matter is at an early stage and, at this time, the Company cannot reasonably estimate the possible loss, or range of loss, in connection with it. | ||
Securities Class Action Complaint | ||
On August 14, 2013, a securities class action complaint against the Company, currently styled Tejinder Singh v. Orthofix International N.V., et al. (No.:1:13-cv-05696-JGK), was filed in the United States District Court for the Southern District of New York arising out of the then-anticipated restatement of the Company’s prior financial statements and the matters described above. In addition to the Company, Alan W. Milinazzo, the Company’s former President and Chief Executive Officer, Robert S. Vaters, the Company’s former President and Chief Executive Officer, Brian McCollum, the Company’s former Chief Financial Officer, Bradley R. Mason, the Company’s current President and Chief Executive Officer, and Emily Buxton, the Company’s current Chief Financial Officer, are named as defendants. The operative complaint has not yet been filed in the action following the appointment by the court of a lead plaintiff. Accordingly, the allegations that the lead plaintiff ultimately intend to make in this action are unknown. The matter is at an early stage and, at this time, the Company cannot reasonably estimate the possible loss, or range of loss, in connection with it. | ||
Review of Potential Improper Payments Involving Brazil Subsidiary | ||
In August 2013, the Company’s internal legal department was notified of certain allegations involving potential improper payments with respect to the Company’s Brazilian subsidiary, Orthofix do Brasil. The Company engaged outside counsel to assist in the review of these matters, focusing on compliance with applicable anti-bribery laws, including the Foreign Corrupt Practices Act (the “FCPA”). This review remains ongoing. The FCPA and related provisions of law provide for potential criminal and civil sanctions in connection with anti-bribery violations, including criminal fines, civil penalties, disgorgement of past profits and other kinds of remedies. The Company currently cannot reasonably estimate a possible loss, or range of loss, in connection with this review. | ||
In 2012, the Company entered into a 3-year deferred prosecution agreement (the “DPA”) with the U.S. Department of Justice (“DOJ”), and a consent to final judgment (the “Consent”) with the U.S. Securities and Exchange Commission (the “SEC”), in connection with the Company’s self-initiated and self-reported review of FCPA-related matters involving the Company’s Mexican subsidiary, Promeca S.A. de C.V. Consistent with certain provisions of the DPA and the Consent, the Company voluntarily self-reported the Brazil-related allegations to the DOJ and the SEC, and the Company and its counsel remain in contact with both agencies regarding the status of the review. The DPA and the Consent collectively require, among other things, that with respect to anti-bribery compliance matters the Company (i) cooperate fully with the government in matters related to corrupt payments, false books and records or inadequate internal controls, (ii) continue to implement a compliance and ethics program designed to prevent and detect violations of the FCPA and other applicable anti-corruption laws, and (iii) provide certain periodic reporting to the government. In the event that the DOJ and the SEC find that the matters related to the Brazilian subsidiary described above could give rise to a review of the Company’s obligations under the terms of the DPA and/or Consent, the Company currently cannot reasonably estimate a possible loss, or range of loss, in connection with that review, including any effects it may have with respect to the DPA and Consent. | ||
Litigation Matters Related To Blackstone Medical, Inc. and Related Escrow Claims | ||
In 2007, the Company’s subsidiary, Blackstone Medical, Inc. (“Blackstone”) received a subpoena issued by HHS-OIG, under the authority of the federal healthcare anti-kickback and false claims statutes. The subpoena sought certain documents for the period January 1, 2000 through July 31, 2006, which covered a period prior to Blackstone’s acquisition by the Company on September 22, 2006. In 2008 and 2009, respectively, the Company received a federal grand jury subpoena from the U.S. Attorney’s Office for the District of Massachusetts (“Boston USAO”) and a HIPAA subpoena issued by the U.S. Department of Justice (“DOJ”). These subpoena sought certain documents from us for the period January 1, 2000 through July 15, 2007. Each of the subpoenas concerned the compensation of physician consultants and related matters. | ||
In 2008, the Company obtained a copy of a qui tam complaint filed against the Company and Blackstone in the U.S. District Court for the District of Massachusetts. The complaint related to the matters described above involving HHS-OIG, the Boston USAO, and DOJ. The U.S. Department of Justice subsequently filed a notice of non-intervention in the case. | ||
In January 2012, after a series of ongoing discussions and negotiations with the Boston USAO, the Company’s board of directors approved an agreement in principle to pay $32 million to resolve these matters. On October 29, 2012, the Company, through Blackstone, entered into a definitive settlement agreement with the U.S. government and the qui tam relator, which settlement agreement memorialized this agreement. All of the $32 million the Company paid pursuant to the settlement was funded by proceeds it received from an escrow fund established in connection with the Company’s acquisition of Blackstone in 2006. We also recorded a charge of $0.3 million in 2012 which represented imputed interest on the settlement accrued through the payment date in October of 2012. | ||
Matters Related to Regenerative Stimulation Business | ||
In 2009, the Company received a HIPAA subpoena (“HIPAA subpoena”) issued by the Boston USAO. The subpoena sought documents concerning, among other things, the Company’s promotion and marketing of its regenerative stimulator devices (which the Company has also described in the past as its “bone growth stimulator devices”). The Boston USAO issued several subsequent document and testimony subpoenas. The Company cooperated with these requests. The Company subsequently obtained a copy of a qui tam complaint filed in the U.S. District Court for the District of Massachusetts against the Company, Orthofix Inc. and other companies that have allegedly manufactured regenerative stimulation devices, including Orthologic Corp., DJO Incorporated, Reable Therapeutics, Inc., the Blackstone Group, L.P., Biomet, Inc., EBI, L.P., EBI Holdings, Inc., EBI Medical Systems, Inc., Bioelectron, Inc., LBV Acquisition, Inc., and Smith & Nephew, Inc. The complaint, as subsequently amended in 2010, alleged various causes of action under the federal False Claims Act and state and city false claims acts premised on the contention that the defendants improperly promoted the sale, as opposed to the rental, of regenerative stimulation devices. The complaint also included claims against the defendants for, among other things, allegedly misleading physicians and purportedly causing them to file false claims and for allegedly violating the Anti-Kickback Act by providing free products to physicians, waiving patients’ insurance co-payments and providing inducements to independent sales agents to generate business. | ||
On April 28, 2011, after a series of ongoing discussions and negotiations with the Boston USAO, the Company’s board of directors approved an agreement in principle proposed by the Boston USAO to resolve the criminal and civil matters described in the immediately preceding two paragraphs. On June 6, 2012, the Company entered into a definitive settlement agreement with the United States of America, acting through DOJ and on behalf of HHS-OIG, the TRICARE Management Activity, through its General Counsel, the Office of Personnel Management, in its capacity as administrator of the Federal Employees Health Benefits Program, the United States Department of Veteran Affairs and the qui tam relator. The Company agreed to pay $34.2 million (plus interest at a rate of 3% from May 5, 2011 through the day before payment was made) under the terms of the settlement agreement. In addition, the Company agreed in July 2012 to pay the qui tam relator’s counsel $1.0 million in fees. These amounts were paid during the fourth quarter of 2012. | ||
In connection with the settlement agreement, the Company’s wholly-owned subsidiary, Orthofix Inc., entered into a plea agreement with the Boston USAO and DOJ on June 7, 2012 under which Orthofix Inc. agreed to plead guilty to one felony count of obstruction of a June 2008 federal audit (§18 U.S.C. 1516). The plea agreement was amended on December 14, 2012, though all terms remained materially consistent with the earlier plea agreement the Company had executed. The plea was accepted and entered by the U.S. District Court for the District of Massachusetts on December 14, 2012. Consistent with the terms recommended in the plea agreement, the court imposed a criminal fine of $7.8 million and a mandatory special assessment of $400, which the Company subsequently paid during the fourth quarter of 2012. In addition, the court has imposed a five year term of probation, with special conditions which mandate certain non-disparagement obligations and order Orthofix Inc. to continue complying with the terms of the Company’s previously-disclosed 5-year corporate integrity agreement (which is described below) through the expiration of its term. | ||
The Company previously recorded a charge of $43 million during the first quarter of 2011 in anticipation of the settlement. The Company also recorded a charge of $1.7 million in 2012 which represented imputed interest on the settlement accrued through the payment date in December 2012. | ||
Corporate Integrity Agreement with HHS-OIG | ||
On June 6, 2012, in connection with the Company’s settlement of the matters described above related to its regenerative stimulation business, and in anticipation of a final settlement of the government investigation and related qui tam complaint described above related to Blackstone Medical, Inc., the Company also entered into a five-year corporate integrity agreement with HHS-OIG (the “CIA”). The CIA acknowledges the existence of the Company’s current compliance program, and requires that the Company continue to maintain during the term of the CIA a compliance program designed to promote compliance with federal healthcare and Food and Drug Administration (“FDA”) requirements. The Company is also required to maintain several elements of its previously existing program during the term of the CIA, including maintaining a Chief Compliance Officer, a Compliance Committee, and a Code of Conduct. The CIA requires that the Company conduct certain additional compliance-related activities during the term of the CIA, including various training and monitoring procedures, and maintaining a disciplinary process for compliance obligations. | ||
Pursuant to the CIA, the Company is required to notify the HHS-OIG in writing, among other things, of: (i) any ongoing government investigation or legal proceeding involving an allegation that the Company has committed a crime or has engaged in fraudulent activities; (ii) any other matter that a reasonable person would consider a probable violation of applicable criminal, civil, or administrative laws related to compliance with Federal healthcare programs or FDA requirements; and (iii) any change in location, sale, closing, purchase, or establishment of a new business unit or location related to items or services that may be reimbursed by federal healthcare programs. The Company is also subject to periodic reporting and certification requirements attesting that the provisions of the CIA are being implemented and followed, as well as certain document and record retention mandates. The CIA provides that in the event of an uncured material breach of the CIA, the Company could be excluded from participation in federal healthcare programs and/or subject to monetary penalties. | ||
Matters Related to Promeca | ||
On July 10, 2012, the Company entered into definitive agreements with DOJ and the Securities and Exchange Commission (the “SEC”) agreeing to settle its self-initiated and self-reported internal investigation of its Mexican subsidiary, Promeca S.A. de C.V. (“Promeca”), regarding non-compliance by Promeca with the Foreign Corrupt Practices Act (“the FCPA”). Under the terms of these agreements, the Company voluntarily disgorged profits to the United States government in an amount of $5.2 million, inclusive of pre-judgment interest, and agreed to pay a fine of $2.2 million. The Company paid $2.2 million in July 2012 and $5.2 million in September 2012. As part of the settlement, the Company entered into a 3-year deferred prosecution agreement (“DPA”) with DOJ. DOJ has agreed not to pursue any criminal charges against the Company in connection with this matter if the Company complies with the terms of the DPA. The DPA takes note of the Company’s self-reporting of this matter to DOJ and the SEC, and of remedial measures, including the implementation of an enhanced compliance program, previously undertaken by the Company. The DPA provides that the Company shall continue to cooperate fully with DOJ in any future matters related to corrupt payments, false books and records or inadequate internal controls. In that regard, the Company has represented that it has implemented and will continue to implement a compliance and ethics program designed to prevent and detect violations of the FCPA and other applicable anti-corruption laws. The Company will periodically report to DOJ during the term of the DPA regarding such remediation and implementation of compliance measures. As part of the settlement, the Company also agreed to certain reporting obligations to the SEC regarding the status of its remediation and implementation of compliance measures. In the event that the Company fails to comply with these obligations, it could be subject to criminal prosecution by DOJ for the FCPA-related matters it self-reported. | ||
Matters Related to the Company’s Former Breg Subsidiary and Possible Indemnification Obligations | ||
On May 24, 2012, the Company sold Breg, Inc. (“Breg”) to an affiliate of Water Street Healthcare Partners II, L.P. (“Water Street”) pursuant to a stock purchase agreement (the “Breg SPA”). Under the terms of the Breg SPA, upon closing of the sale, the Company and its subsidiary, Orthofix Holdings, Inc., agreed to indemnify Water Street and Breg with respect to certain specified matters, including (i) the government investigation and product liability matters regarding the previously owned infusion pump product line described below, and (ii) pre-closing sales of cold therapy units and certain post-closing sales of cold therapy units. The Company has established an accrual of $4.2 million for its indemnification obligations in connection with the July 2012 verdict described in the fourth paragraph below, however, actual liability in this case could be higher or lower than the amount accrued. The Company has not established any accrual in connection with its other indemnification obligations under the Breg SPA, and currently cannot reasonably estimate the possible loss, or range of loss, in connection with such obligations (including with respect to the matters described in the three paragraphs below). | ||
Breg was engaged in the manufacturing and sale of local infusion pumps for pain management from 1999 to 2008. Since 2008, numerous product liability cases have been filed in the United States alleging that the local anesthetic, when dispensed by such infusion pumps inside a joint, causes a rare arthritic condition called “chondrolysis.” The Company believes that meritorious defenses exist to these claims and Breg is vigorously defending these cases. One of the Company’s insurance carriers previously asserted to the Company that certain potential losses related to this matter are not covered by its insurance coverage. The Company subsequently went into arbitration with this carrier, and on January 22, 2013, the Company obtained a binding arbitration award providing that such carrier is obligated to reimburse the Company for defense expenses, settlements, and judgments under certain policies. As of December 31, 2012, the Company estimated that it was entitled to reimbursement of approximately $13 million for past losses incurred, as well as up to $15 million in potential future coverage for pending products liability matters. The approximately $13 million is recorded in income (loss) from discontinued operations in 2012 and other current assets as of December 31, 2012, and was received in 2013. The Company has also accrued $6.1 million (all of which was accrued during the second fiscal quarter of 2013) for judgments and settlements in connection with these matters that were not covered by insurance. | ||
On or about August 2, 2010, Breg received a HIPAA subpoena issued by the DOJ. The subpoena seeks documents from the Company and its subsidiaries for the period of January 1, 2000 through the date of the subpoena. The Company believes that document production in response to the subpoena is completed as of July 2012. The Company believes that this subpoena relates to an investigation by the DOJ into whether Breg’s sale, marketing and labeling of local infusion pumps for pain management, prior to Breg’s divestiture of this product line in 2008, complied with FDA regulations and federal law. The Company is currently cooperating with the U.S. Government in connection with this matter. | ||
On January 27, 2012, the Company was orally notified by a U.S. Government official that a civil investigation of Breg was pending in connection with this matter. On January 18, 2013, the Company was served with a qui tam complaint filed in the United States District Court for the Western District of Missouri against the Company (as the former owner of Breg), Stryker Corporation, I-Flow Corporation and DJO Incorporated, which contains allegations relating to the marketing and promotion of Breg’s former infusion pump products. In June 2013, the qui tam complaint filed in the United States District Court for the Western District of Missouri against the Company was dismissed by the court. | ||
At the time of its divestiture by the Company, Breg was currently and had been engaged in the manufacturing and sales of motorized cold therapy units used to reduce pain and swelling. Several domestic product liability cases have been filed in recent years, mostly in California state court, alleging that the use of cold therapy causes skin and/or nerve injury and seeking damages on behalf of individual plaintiffs who were allegedly injured by such units. The majority of these cases are at an early stage and no conclusion can be drawn at the present time regarding their potential outcome. However, the Company believes that meritorious defenses exist to these claims. In July 2012, a jury in one case related to a motorized cold therapy unit previously sold by Breg returned a verdict providing for approximately $2.1 million in compensatory damages to the plaintiff against Breg and $7 million in exemplary damages. The case remains subject to appeal. The Company believes that the damages are without merit however, the ultimate outcome is uncertain. The Company previously established an accrual and related charge to discontinued operations of $4.2 million for both compensatory damages and exemplary damages for its indemnification obligations in connection with this July 2012 verdict; however, actual liability in this case could be higher or lower than the amount accrued. |
Pensions_and_deferred_compensa
Pensions and deferred compensation | 12 Months Ended | |
Dec. 31, 2012 | ||
Compensation And Retirement Disclosure [Abstract] | ' | |
Pensions and deferred compensation | ' | |
18 | Pensions and deferred compensation | |
Orthofix Inc. sponsors a defined contribution plan (the “Orthofix Inc. 401(k) Plan”) covering substantially all full time US employees. The Orthofix Inc. 401(k) Plan allows for participants to contribute up to 15% of their pre-tax compensation, subject to certain limitations, with the Company matching 100% of the first 2% of the employee’s base compensation and 50% of the next 4% of the employee’s base compensation if contributed to the Orthofix Inc. 401(k) Plan. During the years ended December 31, 2012, 2011 and 2010, expenses incurred relating to 401(k) Plans, including matching contributions, were approximately $2.5 million, $2.5 million and $2.8 million, respectively. | ||
The Company operates defined contribution pension plans for its other International employees not described above meeting minimum service requirements. The Company’s expenses for such pension contributions during 2012, 2011 and 2010 were $0.7 million, $0.8 million and $0.7 million, respectively. | ||
Under Italian Law, Orthofix S.r.l. accrues, on behalf of its employees, deferred compensation, which is paid on termination of employment. Each year’s provision for deferred compensation is based on a percentage of the employee’s current annual remuneration plus an annual charge. Deferred compensation is also accrued for the leaving indemnity payable to agents in case of dismissal which is regulated by a national contract and is equal to approximately 3.5% of total commissions earned from the Company. | ||
The Orthofix Deferred Compensation Plan (the “Plan”), administered by the Board of Directors of the Company, effective January 1, 2007, and as amended and restated effective January 1, 2009, is a plan intended to allow a select group of key management and highly compensated employees of the Company to defer the receipt of compensation that would otherwise be payable to them. The terms of this plan are intended to comply in all respects with the provisions of Code Section 409A and Code Section 457A. As of January 1, 2011 the Company disallowed further contributions into the plan and any new plan participants. Distributions are made in accordance with the requirements of Code Section 409A. | ||
The Company’s expense for deferred compensation during 2012, 2011 and 2010 was approximately $0.4 million, $0.1 million and $0.1 million, respectively. Deferred compensation payments of $0.8 million and $0.2 million were made in 2012 and 2010, respectively. No payments were made during 2011. The balance as of December 31, 2012 and 2011 was $2.3 and $1.5 million that represents the amount which would be payable if all the employees and agents had terminated employment at that date and is included in other long-term liabilities. |
Sharebased_compensation_plans
Share-based compensation plans | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||||||||||||||
Share-based compensation plans | ' | ||||||||||||||||||||
19 | Share-based compensation plans | ||||||||||||||||||||
At December 31, 2012, the Company had stock option and award plans, and an employee stock purchase plan which are described below. | |||||||||||||||||||||
2012 Long Term Incentive Plan | |||||||||||||||||||||
The Board of Directors adopted the Orthofix International N.V. 2012 Long-Term Incentive Plan (the “2012 LTIP”) on April 13, 2012, subject to shareholder approval which was subsequently provided by shareholder ratification. The 2012 LTIP provides for the grant of options to purchase shares of the Company’s common stock, stock awards (including restricted stock, unrestricted stock, and stock units), stock appreciation rights, performance-based awards and other equity-based awards. All of the Company’s employees and the employees of the Company’s subsidiaries and affiliates are eligible to receive awards under the 2012 LTIP. In addition, the Company’s non-employee directors and consultants and advisors who perform services for the Company and the Company’s subsidiaries and affiliates may receive awards under the 2012 LTIP. Incentive share options, however, are only available to the Company’s employees. The Company reserves a total of 1,600,000 shares of common stock for issuance pursuant to the 2012 LTIP, subject to certain adjustments set forth in the 2012 LTIP. At December 31, 2012, there were 156,000 options outstanding under the 2012 LTIP Plan, of which none were exercisable; in addition, there were 125,500 shares of restricted stock outstanding, none of which were vested. | |||||||||||||||||||||
2004 Long Term Incentive Plan | |||||||||||||||||||||
The 2004 Long Term Incentive Plan (the “2004 LTIP Plan”) reserves 3.1 million shares for issuance (in addition to shares (i) available for future awards as of June 29, 2004 under prior plans or (ii) that become available for future issuance upon the expiration or forfeiture after June 29, 2004 of awards upon prior plans). Awards generally vest on years of service with all awards fully vesting within three years from the date of grant for employees and either three or five years from the date of grant for non-employee directors. Awards can be in the form of a stock option, restricted stock, restricted share unit, performance share unit, or other award form determined by the Board of Directors. Awards granted under the 2004 LTIP Plan expire no later than ten years after the date of the grant. The 2004 LTIP Plan provides an annual grant to non-employee directors of 5,000 shares and limits the future the number of shares that may be awarded under the plan as full value awards to 100,000 shares. At December 31, 2012, there were 1,460,355 options outstanding under the 2004 LTIP Plan, of which 1,218,693 were exercisable; in addition, there were 35,331 shares of restricted stock outstanding, none of which were vested. | |||||||||||||||||||||
Staff Share Option Plan | |||||||||||||||||||||
The Staff Share Stock Option Plan (the “Staff Share Plan”) is a fixed stock option plan which was adopted in April 1992. Under the Staff Share Plan, the Company granted options to its employees at the estimated fair market value of such options at the date of grant. Options generally vest based on years of service with all options to be fully vested within five years from date of grant. Options granted under the Staff Share Plan expire ten years after the date of grant. There are no options left to be granted under the Staff Plan. At December 31, 2012, there were 29,600 options outstanding and exercisable under the Staff Share Plan. | |||||||||||||||||||||
Stock Purchase Plan | |||||||||||||||||||||
The Orthofix International N.V. Amended and Restated Stock Purchase Plan (the “Stock Purchase Plan”) provides for the issuance of shares of the Company’s common stock to eligible employees and directors of the Company and its subsidiaries that elect to participate in the plan and acquire shares of common stock through payroll deductions (including executive officers). | |||||||||||||||||||||
During each purchase period, eligible employees may designate between 1% and 25% of their compensation to be deducted for the purchase of common stock under the plan (up to 25% for employees working in North America, South America and Asia, and up to 15% for employees working in Europe). For eligible directors, the designated percentage will be an amount equal to his or her annual or other director compensation paid in cash for the current plan year. The purchase price of the shares under the plan is equal to 85% of the fair market value on the first day of the plan year (which is a calendar year, running from January 1 to December 31) or, if lower, on the last day of the plan year. | |||||||||||||||||||||
Due to the compensatory nature of such plan, the Company has recorded the related share based compensation in the consolidated statement of operations. The aggregate number of shares reserved for issuance under the Employee Stock Purchase Plan is 1,850,000 shares. As of December 31, 2012, 1,362,808 shares had been issued under the Stock Purchase Plan. | |||||||||||||||||||||
Share-Based Compensation: | |||||||||||||||||||||
As of December 31, 2012, the unamortized compensation expense relating to options granted and expected to be recognized was $3.9 million. This amount is expected to be recognized through August 2016. The following table shows the detail of share-based compensation by line item in the consolidated statements of operations for the years ended December 31, 2012, 2011 and 2010 and the assumptions for each of these years in which grants were awarded: | |||||||||||||||||||||
(U.S. Dollars, in thousands, except assumptions) | Year Ended | Year Ended | Year Ended | ||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||
2012 | 2011 | 2010 (1) | |||||||||||||||||||
Cost of sales | $ | 592 | $ | 153 | $ | 210 | |||||||||||||||
Sales and marketing | 1,550 | 2,031 | 3,505 | ||||||||||||||||||
General and administrative | 4,023 | 4,322 | 4,105 | ||||||||||||||||||
Research and development | 138 | 142 | 318 | ||||||||||||||||||
Total | $ | 6,303 | $ | 6,648 | $ | 8,138 | |||||||||||||||
(U.S. Dollars, in thousands, except assumptions) | Year Ended | Year Ended | Year Ended | ||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||
2012 | 2011 | 2010 (1) | |||||||||||||||||||
Assumptions: | |||||||||||||||||||||
Expected term | 4.50 years | 4.58 years | — | ||||||||||||||||||
Expected volatility | 50.9% – 51.8% | 49.6% – 49.9% | — | ||||||||||||||||||
Risk free interest rate | 0.76% – 0.84% | 0.90% – 2.26% | — | ||||||||||||||||||
Dividend rate | — | — | — | ||||||||||||||||||
Weighted average fair value of options granted during the year | $16.99 | $14.21 | $ | — | |||||||||||||||||
-1 | The Company did not grant any options during 2010. | ||||||||||||||||||||
Stock Option Activity: | |||||||||||||||||||||
Summaries of the status of the Company’s stock option plans as of December 31, 2012 and 2011 and changes during the year ended December 31, 2012 are presented below: | |||||||||||||||||||||
Options | Weighted Average | Weighted | |||||||||||||||||||
Exercise Price | Average | ||||||||||||||||||||
Remaining | |||||||||||||||||||||
Contractual | |||||||||||||||||||||
Term | |||||||||||||||||||||
Outstanding at December 31, 2011 | 2,559,272 | $ | 33.41 | ||||||||||||||||||
Granted | 347,250 | $ | 40.46 | ||||||||||||||||||
Exercised | (716,564 | ) | $ | 31.5 | |||||||||||||||||
Forfeited | (244,003 | ) | $ | 40.5 | |||||||||||||||||
Outstanding at December 31, 2012 | 1,945,955 | $ | 34.5 | 5.39 | |||||||||||||||||
Vested and expected to vest at December 31, 2012 | 1,903,616 | $ | 34.42 | 5.31 | |||||||||||||||||
Options exercisable at December 31, 2012 | 1,448,293 | 4.2 | |||||||||||||||||||
Outstanding and exercisable by price range as of December 31, 2012 | |||||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||||
Range of Exercise Prices | Number | Weighted | Weighted | Number | Weighted | ||||||||||||||||
Outstanding | Average | Average | Exercisable | Average | |||||||||||||||||
Remaining | Exercise | Exercise | |||||||||||||||||||
Contractual | Price | Price | |||||||||||||||||||
Life | |||||||||||||||||||||
$10.42 – $25.01 | 253,661 | 5.09 | $ | 23.4 | 253,661 | $ | 23.4 | ||||||||||||||
$25.05 – $28.95 | 326,383 | 5.3 | $ | 26.96 | 314,383 | $ | 26.97 | ||||||||||||||
$29.23 – $33.01 | 314,433 | 6.84 | $ | 31.6 | 167,102 | $ | 31.44 | ||||||||||||||
$33.08 – $38.11 | 347,859 | 3.5 | $ | 37.49 | 307,194 | $ | 37.51 | ||||||||||||||
$38.40 – $39.94 | 282,687 | 6.61 | $ | 39.68 | 126,687 | $ | 39.69 | ||||||||||||||
$40.27 – $41.37 | 210,000 | 7.05 | $ | 41.22 | 68,334 | $ | 41.2 | ||||||||||||||
$43.04 – $45.84 | 188,932 | 3.47 | $ | 44.63 | 188,932 | $ | 44.63 | ||||||||||||||
$50.15 – $50.15 | 12,500 | 4.29 | $ | 50.15 | 12,500 | $ | 50.15 | ||||||||||||||
$50.50 – $50.50 | 2,000 | 4.01 | $ | 50.5 | 2,000 | $ | 50.5 | ||||||||||||||
$50.99 – $50.99 | 7,500 | 4.04 | $ | 50.99 | 7,500 | $ | 50.99 | ||||||||||||||
$10.42 – $50.99 | 1,945,955 | 5.39 | $ | 34.5 | 1,448,293 | $ | 33.54 | ||||||||||||||
The weighted average remaining contractual life of exercisable options was 4.2 years at December 31, 2012. The total intrinsic value of options exercised was $7.2 million, $4.2 million and $3.0 million for the years ended December 31, 2012, 2011 and 2010, respectively. The aggregate intrinsic value of options outstanding and options exercisable as of December 31, 2012 is calculated as the difference between the exercise price of the underlying options and the market price of the Company’s common stock for the shares that had exercise prices that were lower than the $39.33 closing price of the Company’s stock on December 31, 2012. The aggregate intrinsic value of options outstanding was $11.2 million, $10.8 million and $4.8 million for the years ended December 31, 2012, 2011, and 2010, respectively. The aggregate intrinsic value of options exercisable was $9.8 million, $8.4 million and $2.1 million for the years ended December 31, 2012, 2011 and 2010, respectively. | |||||||||||||||||||||
Restricted Stock: | |||||||||||||||||||||
During the year ended December 31, 2012, the Company granted to employees and non-employee directors 149,500 shares of restricted stock, which vest at various dates through November 2015. During the year ended December 31, 2011, the Company granted to employees 94,000 shares of restricted stock, which vest at various dates through February 2014. The compensation expense, which represents the fair value of the stock measured at the market price at the date of grant, less estimated forfeitures, is recognized on a straight-line basis over the vesting period. Unamortized compensation expense related to restricted stock amounted to $4.8 million at December 31, 2012. | |||||||||||||||||||||
A summary of the status of our restricted stock as of December 31, 2012 and 2011 and changes during the year ended December 31, 2012 are presented below: | |||||||||||||||||||||
Shares | Weighted | ||||||||||||||||||||
Average Grant | |||||||||||||||||||||
Date Fair Value | |||||||||||||||||||||
Non-vested as of December 31, 2011 | 69,000 | $ | 29.23 | ||||||||||||||||||
Granted | 149,500 | $ | 40.93 | ||||||||||||||||||
Vested | (28,336 | ) | $ | 29.23 | |||||||||||||||||
Cancelled | (29,333 | ) | $ | 38.87 | |||||||||||||||||
Non-vested as of December 31, 2012 | 160,831 | $ | 38.34 | ||||||||||||||||||
Earnings_per_share
Earnings per share | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||
Earnings per share | ' | ||||||||||||
20 | Earnings per share | ||||||||||||
For each of the three years ended December 31, 2012, there were no adjustments to net income (loss) for purposes of calculating basic and diluted net income (loss) available to common shareholders. The following is a reconciliation of the weighted average shares used in the basic and diluted net income (loss) per common share computations. | |||||||||||||
Year Ended December 31, | |||||||||||||
2012 | 2011 | 2010 | |||||||||||
Weighted average common shares-basic | 18,977,263 | 18,219,343 | 17,601,956 | ||||||||||
Effect of diluted securities: | |||||||||||||
Unexercised stock options net of treasury share repurchase | 413,150 | — | 311,589 | ||||||||||
Weighted average common share-diluted | 19,390,413 | 18,219,343 | 17,913,545 | ||||||||||
No adjustment has been made in 2011 for any common stock equivalents because their effects would be anti-dilutive. For 2011, potentially dilutive shares totaled 344,168. | |||||||||||||
Options to purchase shares of common stock with exercise prices in excess of the average market price of common shares are not included in the computation of diluted earnings per share. There were 789,650 and 1,487,809 outstanding options not included in the diluted earnings per share computation for the fiscal years ended December 31, 2012 and 2011, respectively, because the inclusion of these options was anti-dilutive. |
Restructuring_charges
Restructuring charges | 12 Months Ended | ||||
Dec. 31, 2012 | |||||
Restructuring And Related Activities [Abstract] | ' | ||||
Restructuring charges | ' | ||||
21 | Restructuring charges | ||||
In the fourth quarter of 2008, as part of the Company’s strategic plan to strengthen the business, the Company initiated a restructuring plan to improve operations and reduce costs at Blackstone. The plan involved the consolidation of substantially all of Blackstone’s operations previously conducted in Wayne, NJ and Springfield, MA into the same facility housing its spine stimulation and U.S. orthopedics business in the Dallas, TX area. The Company completed the restructuring and consolidation in the second quarter of 2010 and recognized a total restructuring expense of $3.6 million. | |||||
In the fourth quarter of 2010, the Company initiated a reorganization plan to further streamline operations and lower operating costs within its Spine, Orthopedics and Sports Medicine GBU. During the fourth quarter of 2010, the Company recorded restructuring charges of $0.4 million in Spine and $3.2 million in Orthopedics which were related to employee severance costs. Final cash payments were made during the third quarter of 2011 and no further charges are anticipated. | |||||
These restructuring costs were recorded in the year ended December 31, 2010 consolidated statements of operations with $1.6 million in selling and marketing and $2.0 million in general and administrative expense. | |||||
The following table presents changes in the restructuring liability, which is included within Other Current Liabilities in the Company’s consolidated balance sheets as of December 31, 2011 and December 31, 2010: | |||||
(U.S. Dollars, in thousands) | Severance | ||||
Balance at December 31, 2009 | $ | 1,826 | |||
Charges under 2010 plan | 3,550 | ||||
Cash payments | (3,738 | ) | |||
Balance at December 31, 2010 | 1,638 | ||||
Cash payments | (1,638 | ) | |||
Balance at December 31, 2011 | $ | — | |||
Net_gain_on_sale_of_vascular_o
Net gain on sale of vascular operations | 12 Months Ended | ||||
Dec. 31, 2012 | |||||
Text Block [Abstract] | ' | ||||
Net gain on sale of vascular operations | ' | ||||
22 | Net gain on sale of vascular operations | ||||
On March 8, 2010, the Company entered into an asset purchase agreement (the “APA”) in which the Company agreed to sell substantially all of the assets of its vascular operations related to the A-V IMPULSE SYSTEM ® and related accessories (including finished goods inventory and tangible assets). At the closing, the Company received payment of approximately $27.7 million, which amount includes the estimated value of certain finished goods inventory conveyed at the closing, and remains subject to post-closing verification. | |||||
Pursuant to the APA, the Company agreed to enter into certain transition arrangements at the closing, including (i) a transition services agreement pursuant to which, among other things, the Company would continue to provide operational support with respect to the transferred assets in certain jurisdictions for a period of up to five months, and (ii) two separate supply agreements for certain Impads for a period of two years and provide other products for a period of 90 days. During the second and third quarters of 2010, the Company completed the transition services agreement and one of the supply agreements (which supplies the other products). In September 2011, the Company completed an amendment to the supply agreement to supply certain Impads until March 2014. The Company also agreed to enter into a 5-year noncompetition agreement at closing with respect to the business of the assets being transferred. | |||||
The following table presents the value of the asset disposition, cash proceeds received, net of litigation settlement costs and the net gain on sale of vascular operations as shown in the consolidated statements of operations for the year ended December 31, 2010. | |||||
(U.S. Dollars, in thousands) | Total | ||||
Cash proceeds, net of litigation (1) | $ | 24,215 | |||
Less: | |||||
Transaction related expenses | 2,253 | ||||
Inventory and property, plant and equipment | 2,369 | ||||
Goodwill and intangible assets | 7,574 | ||||
Net gain on sale of vascular operations | 12,019 | ||||
Income tax expense | (3,498 | ) | |||
Net gain on sale of vascular operations, net of taxes | $ | 8,521 | |||
-1 | In conjunction with the sale of the vascular operations, the Company settled an outstanding litigation claim by the former patent holders for $3.5 million. |
Quarterly_financial_data_unaud
Quarterly financial data (unaudited) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||||||
Quarterly financial data (unaudited) | ' | ||||||||||||||||||||
23 | Quarterly financial data (unaudited) | ||||||||||||||||||||
We have restated all quarterly periods of 2012 and 2011 to reflect the restatement described herein. See “Note 2 – Restatement of the Consolidated Financial Statements”. The following tables summarize the impacts of the restatement on our previously reported condensed consolidated statements of operations, balance sheets and statements of cash flows included in our Quarterly Reports on Form 10-Q for each respective period. | |||||||||||||||||||||
Condensed Consolidated Statement of Operations | |||||||||||||||||||||
As Restated | |||||||||||||||||||||
(U.S. Dollars, in thousands, except per share data) | |||||||||||||||||||||
1st | 2nd | 3rd | 4th | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
(Restated) | (Restated) | (Restated) | (Restated) | (Restated) | |||||||||||||||||
2012 | |||||||||||||||||||||
Net sales | $ | 108,936 | $ | 113,423 | $ | 107,857 | $ | 117,365 | $ | 447,581 | |||||||||||
Cost of sales | 21,378 | 27,547 | 24,384 | 24,944 | 98,253 | ||||||||||||||||
Gross profit | 87,558 | 85,876 | 83,473 | 92,421 | 349,328 | ||||||||||||||||
Operating expense | 69,638 | 71,578 | 64,668 | 66,808 | 272,692 | ||||||||||||||||
Operating income | 17,920 | 14,298 | 18,805 | 25,613 | 76,636 | ||||||||||||||||
Net income from continuing operations, net of tax | 8,597 | 9,870 | 10,574 | 16,009 | 45,050 | ||||||||||||||||
Net income (loss) from discontinued operations, net of tax | 810 | (2,616 | ) | (5,558 | ) | 5,152 | (2,212 | ) | |||||||||||||
Net income | $ | 9,407 | $ | 7,254 | $ | 5,016 | $ | 21,161 | $ | 42,838 | |||||||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.46 | $ | 0.52 | $ | 0.55 | $ | 0.83 | $ | 2.37 | |||||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.04 | $ | (0.14 | ) | $ | (0.29 | ) | $ | 0.27 | $ | (0.12 | ) | ||||||||
Net income | $ | 0.5 | $ | 0.38 | $ | 0.26 | $ | 1.1 | $ | 2.25 | |||||||||||
Diluted: | |||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.45 | $ | 0.51 | $ | 0.54 | $ | 0.81 | $ | 2.32 | |||||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.04 | $ | (0.14 | ) | $ | (0.29 | ) | $ | 0.26 | $ | (0.11 | ) | ||||||||
Net income | $ | 0.49 | $ | 0.37 | $ | 0.25 | $ | 1.07 | $ | 2.21 | |||||||||||
2011 | |||||||||||||||||||||
Net sales | $ | 103,606 | $ | 108,216 | $ | 111,510 | $ | 118,639 | $ | 441,971 | |||||||||||
Cost of sales | 22,346 | 22,755 | 23,126 | 27,300 | 95,527 | ||||||||||||||||
Gross profit | 81,260 | 85,461 | 88,384 | 91,339 | 346,444 | ||||||||||||||||
Operating expense | 116,860 | 73,102 | 67,417 | 83,165 | 340,544 | ||||||||||||||||
Operating income (loss) | (35,600 | ) | 12,359 | 20,967 | 8,174 | 5,900 | |||||||||||||||
Net income (loss) from continuing operations, net of tax | (41,749 | ) | 6,579 | 11,300 | 7,652 | (16,218 | ) | ||||||||||||||
Net income (loss) from discontinued operations, net of tax | 282 | (1,184 | ) | (1,225 | ) | 235 | (1,892 | ) | |||||||||||||
Net income (loss) | $ | (41,467 | ) (1) | $ | 5,395 | $ | 10,075 | $ | 7,887 | (2) | $ | (18,110 | ) | ||||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (2.33 | ) | $ | 0.36 | $ | 0.61 | $ | 0.42 | $ | (0.89 | ) | |||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.02 | $ | (0.07 | ) | $ | (0.07 | ) | $ | 0.01 | $ | (0.10 | ) | ||||||||
Net income (loss) | $ | (2.31 | ) | $ | 0.29 | $ | 0.54 | $ | 0.43 | $ | (0.99 | ) | |||||||||
Diluted: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (2.33 | ) | $ | 0.35 | $ | 0.6 | $ | 0.41 | $ | (0.89 | ) | |||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.02 | $ | (0.06 | ) | $ | (0.06 | ) | $ | 0.01 | $ | (0.10 | ) | ||||||||
Net income (loss) | $ | (2.31 | ) | $ | 0.29 | $ | 0.54 | $ | 0.42 | $ | (0.99 | ) | |||||||||
-1 | Includes $46 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
-2 | Includes $10.5 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
Condensed Consolidated Statement of Operations | |||||||||||||||||||||
As Previously Reported | |||||||||||||||||||||
(U.S. Dollars, in thousands, except per share data) | |||||||||||||||||||||
1st | 2nd | 3rd | 4th | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
2012 | |||||||||||||||||||||
Net sales | $ | 116,041 | $ | 119,492 | $ | 114,752 | $ | 112,035 | $ | 462,320 | |||||||||||
Cost of sales | 21,939 | 23,676 | 22,373 | 18,504 | 86,492 | ||||||||||||||||
Gross profit | 94,102 | 95,816 | 92,379 | 93,531 | 375,828 | ||||||||||||||||
Operating expense | 71,671 | 75,251 | 70,846 | 69,050 | 286,818 | ||||||||||||||||
Operating income | 22,431 | 20,565 | 21,533 | 24,481 | 89,010 | ||||||||||||||||
Net income from continuing operations, net of tax | 12,215 | 13,967 | 13,118 | 14,636 | 53,936 | ||||||||||||||||
Net income (loss) from discontinued operations, net of tax | (199 | ) | (2,762 | ) | (5,558 | ) | 5,878 | (2,641 | ) | ||||||||||||
Net income | $ | 12,016 | $ | 11,205 | $ | 7,560 | $ | 20,514 | $ | 51,295 | |||||||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.65 | $ | 0.74 | $ | 0.69 | $ | 0.76 | $ | 2.84 | |||||||||||
Net income (loss) from discontinued operations, net of tax | $ | (0.01 | ) | $ | (0.15 | ) | $ | (0.29 | ) | $ | 0.3 | $ | (0.14 | ) | |||||||
Net income | $ | 0.64 | $ | 0.59 | $ | 0.4 | $ | 1.06 | $ | 2.7 | |||||||||||
Diluted: | |||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.64 | $ | 0.73 | $ | 0.67 | $ | 0.74 | $ | 2.78 | |||||||||||
Net income (loss) from discontinued operations, net of tax | $ | (0.01 | ) | $ | (0.15 | ) | $ | (0.28 | ) | $ | 0.3 | $ | (0.14 | ) | |||||||
Net income | $ | 0.63 | $ | 0.58 | $ | 0.39 | $ | 1.04 | $ | 2.64 | |||||||||||
2011 | |||||||||||||||||||||
Net sales | $ | 113,060 | $ | 116,670 | $ | 117,306 | $ | 123,085 | $ | 470,121 | |||||||||||
Cost of sales | 22,340 | 23,186 | 23,854 | 23,239 | 92,619 | ||||||||||||||||
Gross profit | 90,720 | 93,484 | 93,452 | 99,846 | 377,502 | ||||||||||||||||
Operating expense | 118,217 | 74,088 | 69,853 | 84,035 | 346,193 | ||||||||||||||||
Operating income (loss) | (27,497 | ) | 19,396 | 23,599 | 15,811 | 31,309 | |||||||||||||||
Net income (loss) from continuing operations, net of tax | (36,740 | ) | 10,519 | 12,951 | 11,530 | (1,740 | ) | ||||||||||||||
Net income (loss) from discontinued operations, net of tax | 939 | (561 | ) | (573 | ) | 862 | 667 | ||||||||||||||
Net income (loss) | $ | (35,801 | ) (1) | $ | 9,958 | $ | 12,378 | $ | 12,392 | (2) | $ | (1,073 | ) | ||||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (2.05 | ) | $ | 0.58 | $ | 0.7 | $ | 0.62 | $ | (0.10 | ) | |||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.05 | $ | (0.03 | ) | $ | (0.03 | ) | $ | 0.05 | $ | 0.04 | |||||||||
Net income (loss) | $ | (2.00 | ) | $ | 0.55 | $ | 0.67 | $ | 0.67 | $ | (0.06 | ) | |||||||||
Diluted: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (2.05 | ) | $ | 0.57 | $ | 0.69 | $ | 0.62 | $ | (0.10 | ) | |||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.05 | $ | (0.03 | ) | $ | (0.03 | ) | $ | 0.04 | $ | 0.04 | |||||||||
Net income (loss) | $ | (2.00 | ) | $ | 0.54 | $ | 0.66 | $ | 0.66 | $ | (0.06 | ) | |||||||||
-1 | Includes $46 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
-2 | Includes $10.5 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
Condensed Consolidated Statement of Operations | |||||||||||||||||||||
Restatement Adjustments | |||||||||||||||||||||
(U.S. Dollars, in thousands, except per share data) | |||||||||||||||||||||
1st | 2nd | 3rd | 4th | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
2012 | |||||||||||||||||||||
Net sales | $ | (7,105 | ) | $ | (6,069 | ) | $ | (6,895 | ) | $ | 5,330 | $ | (14,739 | ) | |||||||
Cost of sales | (561 | ) | 3,871 | 2,011 | 6,440 | 11,761 | |||||||||||||||
Gross profit | (6,544 | ) | (9,940 | ) | (8,906 | ) | (1,110 | ) | (26,500 | ) | |||||||||||
Operating expense | (2,033 | ) | (3,673 | ) | (6,178 | ) | (2,242 | ) | (14,126 | ) | |||||||||||
Operating income | (4,511 | ) | (6,267 | ) | (2,728 | ) | 1,132 | (12,374 | ) | ||||||||||||
Net income (loss) from continuing operations, net of tax | (3,618 | ) | (4,097 | ) | (2,544 | ) | 1,373 | (8,886 | ) | ||||||||||||
Net income (loss) from discontinued operations, net of tax | 1,009 | 146 | — | (726 | ) | 429 | |||||||||||||||
Net income (loss) | $ | (2,609 | ) | $ | (3,951 | ) | $ | (2,544 | ) | $ | 647 | $ | (8,457 | ) | |||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (0.19 | ) | $ | (0.22 | ) | $ | (0.14 | ) | $ | 0.07 | $ | (0.47 | ) | |||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.05 | $ | 0.01 | $ | — | $ | (0.03 | ) | $ | 0.02 | ||||||||||
Net income (loss) | $ | (0.14 | ) | $ | (0.21 | ) | $ | (0.14 | ) | $ | 0.04 | $ | (0.45 | ) | |||||||
Diluted: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (0.19 | ) | $ | (0.22 | ) | $ | (0.13 | ) | $ | 0.07 | $ | (0.46 | ) | |||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.05 | $ | 0.01 | $ | (0.01 | ) | $ | (0.04 | ) | $ | 0.03 | |||||||||
Net income (loss) | $ | (0.14 | ) | $ | (0.21 | ) | $ | (0.14 | ) | $ | (0.03 | ) | $ | (0.43 | ) | ||||||
2011 | |||||||||||||||||||||
Net sales | $ | (9,454 | ) | $ | (8,454 | ) | $ | (5,796 | ) | $ | (4,446 | ) | $ | (28,150 | ) | ||||||
Cost of sales | 6 | (431 | ) | (728 | ) | 4,061 | 2,908 | ||||||||||||||
Gross profit | (9,460 | ) | (8,023 | ) | (5,068 | ) | (8,507 | ) | (31,058 | ) | |||||||||||
Operating expense | (1,357 | ) | (986 | ) | (2,436 | ) | (870 | ) | (5,649 | ) | |||||||||||
Operating income | (8,103 | ) | (7,037 | ) | (2,632 | ) | (7,637 | ) | (25,409 | ) | |||||||||||
Net income (loss) from continuing operations, net of tax | (5,009 | ) | (3,940 | ) | (1,651 | ) | (3,878 | ) | (14,478 | ) | |||||||||||
Net income (loss) from discontinued operations, net of tax | (657 | ) | (623 | ) | (652 | ) | (627 | ) | (2,559 | ) | |||||||||||
Net income (loss) | $ | (5,666 | ) | $ | (4,563 | ) | $ | (2,303 | ) | $ | (4,505 | ) | $ | (17,037 | ) | ||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (0.28 | ) | $ | (0.22 | ) | $ | (0.09 | ) | $ | (0.20 | ) | $ | (0.79 | ) | ||||||
Net income (loss) from discontinued operations, net of tax | $ | (0.03 | ) | $ | (0.04 | ) | $ | (0.04 | ) | $ | (0.04 | ) | $ | (0.14 | ) | ||||||
Net income (loss) | $ | (0.31 | ) | $ | (0.26 | ) | $ | (0.13 | ) | $ | (0.24 | ) | $ | (0.93 | ) | ||||||
Diluted: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (0.28 | ) | $ | (0.22 | ) | $ | (0.09 | ) | $ | (0.21 | ) | $ | (0.79 | ) | ||||||
Net income (loss) from discontinued operations, net of tax | $ | (0.03 | ) | $ | (0.03 | ) | $ | (0.03 | ) | $ | (0.03 | ) | $ | (0.14 | ) | ||||||
Net income (loss) | $ | (0.31 | ) | $ | (0.25 | ) | $ | (0.12 | ) | $ | (0.24 | ) | $ | (0.93 | ) | ||||||
-1 | Includes $46 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
-2 | Includes $10.5 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
Condensed Consolidated Balance Sheets | |||||||||||||||||||||
As Restated | |||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | 1st | 2nd | 3rd | 4th | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
(Restated) | (Restated) | (Restated) | (Restated) | ||||||||||||||||||
2012 | |||||||||||||||||||||
Total assets | $ | 694,106 | $ | 530,395 | $ | 539,566 | $ | 472,897 | |||||||||||||
Total liabilities | 381,734 | 205,196 | 193,599 | 105,065 | |||||||||||||||||
Total shareholders’ equity | 312,372 | 325,199 | 345,967 | 367,832 | |||||||||||||||||
Total liabilities and shareholders’ equity | $ | 694,106 | $ | 530,395 | $ | 539,566 | $ | 472,897 | |||||||||||||
2011 | |||||||||||||||||||||
Total assets | $ | 618,938 | $ | 632,860 | $ | 639,868 | $ | 685,380 | |||||||||||||
Total liabilities | 354,949 | 352,884 | 347,777 | 393,306 | |||||||||||||||||
Total shareholders’ equity | 263,989 | 279,976 | 292,091 | 292,074 | |||||||||||||||||
Total liabilities and shareholders’ equity | $ | 618,938 | $ | 632,860 | $ | 639,868 | $ | 685,380 | |||||||||||||
Condensed Consolidated Balance Sheets | |||||||||||||||||||||
As Previously Reported | |||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | 1st | 2nd | 3rd | 4th | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
2012 | |||||||||||||||||||||
Total assets | $ | 707,586 | $ | 553,320 | $ | 565,073 | $ | 504,281 | |||||||||||||
Total liabilities | 369,178 | 199,104 | 187,463 | 105,183 | |||||||||||||||||
Total shareholders’ equity | 338,408 | 354,216 | 377,610 | 399,098 | |||||||||||||||||
Total liabilities and shareholders’ equity | $ | 707,586 | $ | 553,320 | $ | 565,073 | $ | 504,281 | |||||||||||||
2011 | |||||||||||||||||||||
Total assets | $ | 631,284 | $ | 647,026 | $ | 656,073 | $ | 704,472 | |||||||||||||
Total liabilities | 354,201 | 349,116 | 345,130 | 389,301 | |||||||||||||||||
Total shareholders’ equity | 277,083 | 297,910 | 310,943 | 315,171 | |||||||||||||||||
Total liabilities and shareholders’ equity | $ | 631,284 | $ | 647,026 | $ | 656,073 | $ | 704,472 | |||||||||||||
Condensed Consolidated Balance Sheets | |||||||||||||||||||||
Restatement Adjustments | |||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | 1st | 2nd | 3rd | 4th | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
2012 | |||||||||||||||||||||
Total assets | $ | (13,480 | ) | $ | (22,925 | ) | $ | (25,507 | ) | $ | (31,384 | ) | |||||||||
Total liabilities | 12,556 | 6,092 | 6,136 | (118 | ) | ||||||||||||||||
Total shareholders’ equity | (26,036 | ) | (29,017 | ) | (31,643 | ) | (31,266 | ) | |||||||||||||
Total liabilities and shareholders’ equity | $ | (13,480 | ) | $ | (22,925 | ) | $ | (25,507 | ) | $ | (31,384 | ) | |||||||||
2011 | |||||||||||||||||||||
Total assets | $ | (12,346 | ) | $ | (14,166 | ) | $ | (16,205 | ) | $ | (19,092 | ) | |||||||||
Total liabilities | 748 | 3,768 | 2,647 | 4,005 | |||||||||||||||||
Total shareholders’ equity | (13,094 | ) | (17,934 | ) | (18,852 | ) | (23,097 | ) | |||||||||||||
Total liabilities and shareholders’ equity | $ | (12,346 | ) | $ | (14,166 | ) | $ | (16,205 | ) | $ | (19,092 | ) | |||||||||
Subsequent_Events
Subsequent Events | 12 Months Ended | |
Dec. 31, 2012 | ||
Subsequent Events [Abstract] | ' | |
Subsequent Events | ' | |
24 | Subsequent Events | |
In August 2013, as a result of the delay in filing our second quarter report on Form 10-Q and delay in filing our third quarter report on Form 10-Q, we sought and obtained a Limited Waiver which waived requirements under the Credit Agreement to deliver quarterly financial statements for the fiscal quarters ending on June 30, 2013 and September 30, 2013, and related financial covenant certificates, until the earlier of (i) March 31, 2014 or (ii) the date that is one day after such financial statements are publicly filed or released. | ||
On May 8, 2013, the Company announced that its Board of Directors authorized a share repurchase program in an amount up to $50 million. Repurchases began on May 10, 2013 consisting primarily of open market transactions at prevailing market prices in accordance with the guidelines specified under Rule 10b-18 of the Securities Exchange Act of 1934, as amended. Repurchases were being made from cash on hand, cash generated from operations and additional borrowings. The timing of the transactions and the aggregate number of shares of common stock that will be ultimately repurchased under the repurchase program will depend on a variety of factors, including market conditions and the prices at which the securities are repurchased. The Company may discontinue repurchases without prior notice at any time if it determines additional repurchases are not warranted. As of the date of this Form 10-K/A, the Company has made total repurchases in an amount equal to approximately $39.5 million, all of which were made during the fiscal quarters ended June 30, 2013 and September 30, 2013. |
Schedule_1Condensed_Financial_
Schedule 1-Condensed Financial Information of Registrant Orthofix International N.V. | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] | ' | ||||||||||||
Schedule 1-Condensed Financial Information of Registrant Orthofix International N.V. | ' | ||||||||||||
Schedule 1—Condensed Financial Information of Registrant Orthofix International N.V. | |||||||||||||
Condensed Balance Sheets (unaudited) | |||||||||||||
(U.S. Dollars, in thousands) | December 31, | December 31, | |||||||||||
2012 | 2011 | ||||||||||||
(Restated) | (Restated) | ||||||||||||
Assets | |||||||||||||
Current assets: | |||||||||||||
Cash and cash equivalents | $ | 7,392 | $ | 19,433 | |||||||||
Prepaid expenses and other current assets | 534 | 487 | |||||||||||
Total current assets | 7,926 | 19,920 | |||||||||||
Other long term assets | 15 | 61 | |||||||||||
Investments in and amounts due from subsidiaries and affiliates | 369,204 | 284,105 | |||||||||||
Total assets | $ | 377,145 | $ | 304,086 | |||||||||
Liabilities and shareholder’s equity | |||||||||||||
Current liabilities | $ | 1,202 | $ | 3,900 | |||||||||
Long-term liabilities | 8,111 | 8,111 | |||||||||||
Shareholder’s equity: | |||||||||||||
Common stock | 1,934 | 1,846 | |||||||||||
Additional paid in capital | 246,306 | 214,505 | |||||||||||
Accumulated earnings | 114,847 | 72,009 | |||||||||||
Accumulated other comprehensive income | 4,745 | 3,715 | |||||||||||
367,832 | 292,075 | ||||||||||||
Total liabilities and shareholder’s equity | $ | 377,145 | $ | 304,086 | |||||||||
See accompanying notes to condensed financial statements. | |||||||||||||
Orthofix International N.V. | |||||||||||||
Schedule 1—Condensed Financial Information of Registrant Orthofix International N.V. | |||||||||||||
Condensed Statements of Operations (unaudited) | |||||||||||||
(U.S. Dollars, in thousands) | Year Ended | Year Ended | Year Ended | ||||||||||
December 31, | December 31, | December 31, | |||||||||||
2012 | 2011 | 2010 | |||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||
(Expenses) income: | |||||||||||||
General and administrative | $ | (7,700 | ) | $ | (11,134 | ) | $ | (13,146 | ) | ||||
Equity in earnings of investments in subsidiaries and affiliates | 50,317 | (6,296 | ) | 59,517 | |||||||||
Other, net | 24 | 7 | (199 | ) | |||||||||
Income (loss) before income taxes | 42,641 | (17,423 | ) | 46,172 | |||||||||
Income tax benefit (expense) | 197 | (687 | ) | (1,876 | ) | ||||||||
Net income (loss) | $ | 42,838 | $ | (18,110 | ) | $ | 44,296 | ||||||
See accompanying notes to condensed financial statements. | |||||||||||||
Orthofix International N.V. | |||||||||||||
Schedule 1—Condensed Financial Information of Registrant Orthofix International N.V. | |||||||||||||
Condensed Statement of Cash Flows | |||||||||||||
(U.S. Dollars, in thousands) | Year Ended | Year Ended | Year Ended | ||||||||||
December 31, | December 31, | December 31, | |||||||||||
2012 | 2011 | 2010 | |||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||
Net income (loss) | $ | 42,838 | $ | (18,110 | ) | $ | 44,296 | ||||||
Equity in earnings of investments in subsidiaries and affiliates | (50,317 | ) | 6,296 | (59,517 | ) | ||||||||
Cash used in other operating activities | (6,811 | ) | 3,429 | 7,111 | |||||||||
Net cash used in operating activities | (14,290 | ) | (8,385 | ) | (8,110 | ) | |||||||
Cash flows from investing activities: | |||||||||||||
Distributions and amounts received from subsidiaries | 12,564 | 5,875 | 21,597 | ||||||||||
Capital expenditures | — | — | (5 | ) | |||||||||
Net cash provided by investing activities | 12,564 | 5,875 | 21,592 | ||||||||||
Cash flows from financing activities: | |||||||||||||
Net proceeds from issuance of common stock | 25,586 | 20,113 | 7,854 | ||||||||||
Contributions to subsidiaries and affiliates | (36,921 | ) | (2,789 | ) | (21,274 | ) | |||||||
Tax benefit on exercise of stock options | 1,020 | 1,737 | 2,417 | ||||||||||
Net cash provided by (used in) financing activities | (10,315 | ) | 19,061 | (11,003 | ) | ||||||||
Net increase (decrease) in cash and cash equivalents | (12,041 | ) | 16,551 | 2,479 | |||||||||
Cash and cash equivalents at the beginning of the year | 19,433 | 2,882 | 403 | ||||||||||
Cash and cash equivalents at the end of the year | $ | 7,392 | $ | 19,433 | $ | 2,882 | |||||||
See accompanying notes to condensed financial statements. | |||||||||||||
Orthofix International N.V. | |||||||||||||
Schedule 1—Condensed Financial Information of Registrant Orthofix International N.V. | |||||||||||||
Notes to Condensed Financial Statements (unaudited) | |||||||||||||
1 | Background and basis of presentation | ||||||||||||
These condensed parent company financial statements have been prepared in accordance with Rule 12-04, Schedule 1 of Regulation S-X, as the restricted net assets of Orthofix Holdings, Inc. and its subsidiaries exceed 25% of the consolidated net assets of Orthofix International N.V. and its subsidiaries (the “Company”). This information should be read in conjunction with the Company’s consolidated financial statements included elsewhere in this filing. | |||||||||||||
2 | Restricted net assets of subsidiaries | ||||||||||||
Certain of the Company’s subsidiaries have restrictions on their ability to pay dividends or make intercompany loans and advances pursuant to their financing arrangements. The amount of restricted net assets the Company’s subsidiaries held at December 31, 2012 and 2011 was approximately $213.4 million and $162.7 million, respectively. Such restrictions are on net assets of Orthofix Holdings, Inc. and its subsidiaries. | |||||||||||||
3 | Commitments, contingencies and long-term obligations | ||||||||||||
For a discussion of the Company’s commitments, contingencies and long term obligations under its senior secured credit facility, see Note 9, Note 12 and Note 17 of the Company’s consolidated financial statements. | |||||||||||||
4 | Dividends from subsidiaries | ||||||||||||
Cash dividends received by Orthofix International N.V. from its consolidated subsidiaries accounted for by the equity method were $5.9 million and $21.6 million for the years ended December 31, 2011 and 2010, respectively. Orthofix International N.V. did not receive cash dividends in 2012. |
Schedule_2Valuation_and_Qualif
Schedule 2-Valuation and Qualifying Accounts | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||
Valuation And Qualifying Accounts [Abstract] | ' | ||||||||||||||||||||
Schedule 2-Valuation and Qualifying Accounts | ' | ||||||||||||||||||||
Schedule 2—Valuation and Qualifying Accounts | |||||||||||||||||||||
For the years ended December 31, 2012, 2011 and 2010: | |||||||||||||||||||||
Additions | |||||||||||||||||||||
(U.S. Dollars, in thousands) | Balance at | Charged to | Charged | Deductions/ | Balance at | ||||||||||||||||
beginning | cost and | (credited) | Other | end of year | |||||||||||||||||
Provisions from assets to which they apply: | of year | expenses | to other | ||||||||||||||||||
accounts | |||||||||||||||||||||
2012 | (Restated | ) | (Restated | ) | (Restated | ) | (Restated | ) | (Restated | ) | |||||||||||
Allowance for doubtful accounts receivable | $ | 9,341 | $ | 10,387 | $ | (13 | ) | $ | (6,172 | ) | $ | 13,543 | |||||||||
Deferred tax valuation allowance | 19,124 | 7,237 | — | — | 26,361 | ||||||||||||||||
2011 | |||||||||||||||||||||
Allowance for doubtful accounts receivable | $ | 6,542 | $ | 12,879 | $ | (501 | ) | $ | (9,579 | ) | $ | 9,341 | |||||||||
Deferred tax valuation allowance | 21,023 | (1,899 | ) | — | — | 19,124 | |||||||||||||||
2010 | |||||||||||||||||||||
Allowance for doubtful accounts receivable | $ | 6,584 | $ | 8,627 | $ | (4 | ) | $ | (8,665 | ) | $ | 6,542 | |||||||||
Deferred tax valuation allowance | 17,239 | 3,784 | — | — | 21,023 |
Summary_of_significant_account1
Summary of significant accounting policies (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Basis of consolidation | ' | ||||||||||||
(a) | Basis of consolidation | ||||||||||||
The consolidated financial statements include the financial statements of the Company and its wholly-owned and majority-owned subsidiaries and entities over which the Company has control. | |||||||||||||
All intercompany accounts, transactions and profits are eliminated in the consolidated financial statements on a continuing operations basis unless otherwise noted. | |||||||||||||
Use of estimates in preparation of financial statements | ' | ||||||||||||
(b) | Use of estimates in preparation of financial statements | ||||||||||||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, we evaluate our estimates, including those related to the recoverability and useful lives of long-lived assets and the adequacy of the allowance for doubtful accounts and inventory obsolescence, and income taxes. We base our estimates on historical experience, future expectations and on other relevant assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. | |||||||||||||
Foreign currency translation | ' | ||||||||||||
(c) | Foreign currency translation | ||||||||||||
The financial statements for operations outside the United States are generally maintained in their local currency. All foreign currency denominated balance sheet accounts, except shareholders’ equity, are translated to U.S. dollars at year end exchange rates and revenue and expense items are translated at weighted average rates of exchange prevailing during the year. Gains and losses resulting from the translation of foreign currency are recorded in the accumulated other comprehensive income component of shareholders’ equity. Transactional foreign currency gains and (losses), including those generated from intercompany operations, are included in other expense, net and were $0.5 million loss, $1.6 million loss and $0.1 million loss for the years ended December 31, 2012, 2011 and 2010, respectively. | |||||||||||||
Cash and cash equivalents | ' | ||||||||||||
(d) | Cash and cash equivalents | ||||||||||||
The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. | |||||||||||||
Restricted cash | ' | ||||||||||||
(e) | Restricted cash | ||||||||||||
Restricted cash consists of cash held at certain subsidiaries, the distribution or transfer of which to Orthofix International N.V. (the “Parent”) or other subsidiaries that are not parties to the credit facility described in Note 9 is restricted. The senior secured credit facility restricts the parent and subsidiaries that are not parties to the facility from access to cash held by Orthofix Holdings, Inc. and its subsidiaries. All credit party subsidiaries have access to this cash for operational and debt repayment purposes. | |||||||||||||
Market risk | ' | ||||||||||||
(f) | Market risk | ||||||||||||
In the ordinary course of business, the Company is exposed to the impact of changes in interest rates and foreign currency fluctuations. The Company’s objective is to limit the impact of such movements on earnings and cash flows. In order to achieve this objective, the Company seeks to balance its non-dollar denominated income and expenditures. During 2008, the Company executed an interest rate swap agreement to manage the cash flow exposure generated from interest rate fluctuations. On June 29, 2010, the Company settled the interest rate swap. During 2012, 2011 and 2010, the Company made use of a foreign currency swap agreement to manage cash flow exposure generated from foreign currency fluctuations. See Note 10 for additional information. | |||||||||||||
The Company generally does not require collateral on trade receivables. | |||||||||||||
Inventories | ' | ||||||||||||
(g) | Inventories | ||||||||||||
Inventories are valued at the lower of cost or estimated net realizable value, after provision for excess, obsolete or impaired items which is reviewed and updated on a periodic basis by management. For inventory procured or produced, whether internally or through contract manufacturing arrangements, at our manufacturing facility in Italy, cost is determined on a weighted-average basis, which approximates the first-in, first-out (“FIFO”) method, due to the high turn-over rate of inventory at this location. For inventory procured or produced, whether internally or through contract manufacturing arrangements, at our manufacturing facility in Texas, standard costs, which approximates actual cost on a FIFO basis, is used to value inventory. Standard costs are reviewed annually by management, or more often in the event circumstances indicate a change in cost has occurred. The valuation of work-in-process, finished products, field inventory and consignment inventory includes the cost of materials, labor and other production costs. Field inventory represents immediately saleable finished products inventory that is in the possession of the Company’s direct sales representatives. Consignment inventory represents immediately saleable finished products located at third party customers, such as distributors and hospitals. | |||||||||||||
Long-lived assets, including intangibles and goodwill | ' | ||||||||||||
(h) | Long-lived assets, including intangibles and goodwill | ||||||||||||
Property, plant and equipment is stated at cost less accumulated depreciation. Costs include all expenditures necessary to place the asset in service, including freight and sales and use taxes. Plant and equipment also includes instrumentation held by customers and is generally used to facilitate the implantation of the Company’s products. Depreciation is computed on a straight-line basis over the useful lives of the assets. Depreciation of leasehold improvements is computed over the shorter of the lease term or the useful life of the asset. The useful lives are as follows: | |||||||||||||
Years | |||||||||||||
Buildings | 25 to 33 | ||||||||||||
Plant, equipment and instrumentation | 2 to 10 | ||||||||||||
Furniture and fixtures | 4 to 8 | ||||||||||||
Expenditures for maintenance and repairs and minor renewals and improvements, which do not extend the lives of the respective assets, are expensed as incurred. All other expenditures for renewals and improvements are capitalized. The assets and related accumulated depreciation are adjusted for property retirements and disposals, with the resulting gain or loss included in operations. Fully depreciated assets remain in the accounts until retired from service. | |||||||||||||
Patents and other intangible assets are recorded at cost, or when acquired as a part of a business combination at estimated fair value. These assets primarily include patents and other technology agreements (“developed technologies”) and trademarks. Identifiable intangible assets which are considered definite lived are amortized over their useful lives using a method of amortization that reflects the pattern in which the economic benefit of the intangible assets is consumed. The Company’s weighted average amortization period for developed technologies is 11 years. | |||||||||||||
Intangible and long-lived assets with definite lives, such as developed technologies, are tested for impairment if any adverse conditions exist or change in circumstances have occurred that would indicate impairment or a change in the remaining useful life. If an impairment indicator exists, the Company tests the intangible asset for recoverability. For purposes of the recoverability test, the Company groups its intangible assets with other assets and liabilities at the lowest level of identifiable cash flows if the intangible asset does not generate cash flows independent of other assets and liabilities. If the carrying value of the intangible asset (asset group) exceeds the undiscounted cash flows expected to result from the use and eventual disposition of the intangible asset (asset group), the Company will write the carrying value down to the fair value in the period identified. | |||||||||||||
The Company generally calculates fair value of indefinite-lived intangible assets as the present value of estimated future cash flows. In determining the estimated future cash flows associated with intangible assets, the Company uses estimates and assumptions about future revenue contributions, cost structures and remaining useful lives of the asset (asset group). The use of alternative assumptions, including estimated cash flows, discount rates, and alternative estimated remaining useful lives could result in different calculations of impairment. | |||||||||||||
The Company tests goodwill at least annually for impairment. The Company tests more frequently if indicators are present or changes in circumstances suggest that impairment may exist. These indicators include, among others, declines in sales, earnings or cash flows, or the development of a material adverse change in the business climate. The Company assesses goodwill for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment, referred to as a component. The Company has identified two reporting units, which are consistent with the Company’s reporting segments; Spine and Orthopedics (see Note 13 for additional information). | |||||||||||||
Goodwill | |||||||||||||
In order to calculate the respective carrying values, the Company initially recorded goodwill based on the purchase price allocation performed at the time of acquisition. Corporate assets and liabilities that directly relate to a reporting unit’s operations are ascribed directly to that reporting unit. Corporate assets and liabilities that are not directly related to a specific reporting unit, but from which the reporting unit benefits, are allocated based on the respective contribution measure of each reporting unit. Effective January 1, 2011, the Company re-aligned its reporting units and consequently reallocated the carrying value of goodwill from its previous reporting units to its new reporting units based on the relative fair value of each new reporting unit to total enterprise value at January 1, 2011. | |||||||||||||
In the first quarter of 2012, Accounting Standards Update (“ASU”) 2011-08, “Testing of Goodwill for Impairment” became effective. ASU 2011-08 allows entities testing goodwill for impairment the option of performing a qualitative assessment before calculating the fair value of a reporting unit (i.e. the first step of the goodwill impairment test). If entities determine, on the basis of qualitative factors, that the fair value of the reporting unit is more likely than not greater than the carrying amount, a quantitative calculation would not be needed. | |||||||||||||
The Company’s annual goodwill impairment analysis, which was performed qualitatively during the fourth quarter of 2012, did not result in impairment charge. | |||||||||||||
Derivative instruments | ' | ||||||||||||
(i) | Derivative instruments | ||||||||||||
The Company manages its exposure to fluctuating cash flows resulting from changes in interest rates and foreign exchange within the consolidated financial statements according to its hedging policy. Under the policy, the Company may engage in non-leveraged transactions involving various financial derivative instruments to manage exposed positions. The policy requires the Company to formally document the relationship between the hedging instrument and hedged item, as well as its risk-management objective and strategy for undertaking the hedge transaction. For instruments designated as a cash flow hedge, the Company formally assesses (both at the hedge’s inception and on an ongoing basis) whether the derivative that is used in the hedging transaction has been effective in offsetting changes in the cash flows of the hedged item and whether such derivative may be expected to remain effective in future periods. If it is determined that a derivative is not (or has ceased to be) effective as a hedge, the Company will discontinue the related hedge accounting prospectively. Such a determination would be made when (1) the derivative is no longer effective in offsetting changes in the cash flows of the hedged item; (2) the derivative expires or is sold, terminated or exercised; or (3) management determines that designating the derivative as a hedging instrument is no longer appropriate. Ineffective portions of changes in the fair value of cash flow hedges are recognized in earnings. | |||||||||||||
The Company records all derivatives as either assets or liabilities on the balance sheet at their respective fair values. For a cash flow hedge, the effective portion of the derivative’s change in fair value (i.e. gains or losses) is initially reported as a component of other comprehensive income, net of related taxes, and subsequently reclassified into net earnings when the hedged exposure is no longer effective. | |||||||||||||
The Company utilizes a cross currency swap to manage its foreign currency exposure related to a portion of the Company’s intercompany receivable of a U.S. dollar functional currency subsidiary that is denominated in Euro. The cross currency swap has been accounted for as a cash flow hedge in accordance with ASC Topic 815, Derivatives and Hedging. | |||||||||||||
See Note 10 for a description of the types of derivative instruments the Company utilizes. | |||||||||||||
Accumulated other comprehensive income | ' | ||||||||||||
(j) | Accumulated other comprehensive income | ||||||||||||
Accumulated other comprehensive income is comprised of foreign currency translation adjustments and the effective portion of the gain (loss) on the Company’s cross-currency swap, which is designated and accounted for as a cash flow hedge (see Note 10). The components of and changes in accumulated other comprehensive income are as follows: | |||||||||||||
(U.S. Dollars, in thousands) | Foreign Currency | Fair Value of | Accumulated Other | ||||||||||
Translation | Cross- | Comprehensive | |||||||||||
Adjustments | Currency Swaps | Income (Loss) | |||||||||||
Balance at December 31, 2010 (Restated) | $ | 6,125 | $ | 305 | $ | 6,430 | |||||||
Unrealized loss on cross-currency swaps, net of tax benefit of $256 | — | (437 | ) | (437 | ) | ||||||||
Foreign currency translation adjustment (1) | (2,279 | ) | — | (2,279 | ) | ||||||||
Balance at December 31, 2011 (Restated) | 3,846 | (132 | ) | 3,714 | |||||||||
Unrealized gain on cross-currency swaps, net of tax of $153 | — | 263 | 263 | ||||||||||
Foreign currency translation adjustment (1) | 768 | — | 768 | ||||||||||
Balance at December 31, 2012 (Restated) | $ | 4,614 | $ | 131 | $ | 4,745 | |||||||
-1 | As the cash generally remains permanently invested in the non U.S. dollar denominated foreign subsidiaries, no deferred taxes are recognized on the related foreign currency translation adjustment. | ||||||||||||
Revenue recognition and accounts receivable | ' | ||||||||||||
(k) | Revenue recognition and accounts receivable | ||||||||||||
Commercial revenue is related to the sale of the Company’s spine and orthopedic implant products, generally representing hospital customers. Revenues are recognized when these products have been utilized and a confirming purchase order has been received from the hospital. | |||||||||||||
Revenue is derived from third-party payors, including commercial insurance carriers, health maintenance organizations, preferred provider organizations and governmental payors such as Medicare, in connection with the sale of our stimulation products. Revenue is recognized when the stimulation product is placed on or implanted in and accepted by the patient. Amounts paid by these third-party payors are generally based on fixed or allowable reimbursement rates. These revenues are recorded at the expected or pre-authorized reimbursement rates, net of any contractual allowances or adjustments. Certain billings are subject to review by the third-party payors and may be subject to adjustment. | |||||||||||||
For distributor revenue which is related primarily to spine and orthopedic implant products, the Company recognizes revenue either on a sell-in or sell-through basis depending on the specific circumstances of the distributor. In some cases the Company recognizes distributor revenue as title and risk of loss passes at either shipment from the Company’s facilities or receipt at the distributor’s facility, assuming all other revenue recognition criteria has been achieved (the “sell-in method”). Based on the results of the Independent Review, the Company determined in some cases the revenue recognition criteria for distributor sales were not satisfied at the time of shipment or receipt; specifically, the existence of extra-contractual terms or arrangements caused the Company not to meet the fixed or determinable criteria for revenue recognition in some cases, and in others collectability had not been established. In situations where we are unable to satisfy the requirements to recognize revenue on the sell-in method, we recognize revenue relating to distributor arrangements once the product is delivered to the end customer (the “sell-through method”). Because the Company does not have reliable information about when its distributors sell the product through to end customers, the Company uses cash collection from distributors as a basis for revenue recognition under the sell-through method. Although in many cases the Company is legally entitled to the accounts receivable at the time of shipment, the Company has not recognized accounts receivables or any corresponding deferred revenues associated with distributor transactions for which revenue is recognized on the sell-through method. Effective April 1, 2013, all distributor revenue is recognized on the sell-through basis. | |||||||||||||
For distributors on the sell-in method, cost of sales are recognized upon shipment. For sell-through distributors, whose revenue is recognized upon cash receipt, the Company considers whether to match the related cost of sales expense with revenue or to recognize expense upon shipment. In making this assessment, the Company considers the financial viability of its distributors based on their creditworthiness to determine if collectability of amounts sufficient to realize the costs of the products shipped is reasonably assured at the time of shipment to these distributors. In instances where the distributor is determined to be financially viable, the Company defers the costs of sales until the revenue is recognized. | |||||||||||||
Biologics revenue is primarily related to a collaborative arrangement with MTF. In 2008, the Company entered into a collaborative arrangement with MTF to develop and commercialize Trinity Evolution ®, a stem cell-based bone growth biologic matrix. With the development process completed in 2009, the Company and MTF operated under the terms of a separate commercialization agreement. Under the terms of the 10-year agreement, MTF sourced the tissue, processed it to create the bone growth matrix, packaged and delivered it to the customer in accordance with orders received from the Company. The Company has exclusive global marketing rights for Trinity Evolution ® and receives marketing fees from MTF based on total sales. These marketing fees are recorded on a net basis within net sales and were $46.5 million, $36.8 million and $29.7 million in 2012, 2011 and 2010, respectively. On January 10, 2012, the Company announced that it had reached an agreement with MTF to both co-develop and commercialize a new technology for use in bone grafting applications and to expand MTF’s Trinity Evolution ® processing capacity. The amendment amends the term of the existing agreement until the later of (i) 15 years after the date that certain development milestones were achieved under the existing agreement (which occurred during 2010) or (ii) the date that certain licensing arrangements between the Company and NuVasive, Inc. expire. MTF is considered the primary obligor in these arrangements and therefore the Company recognizes these marketing service fees on a net basis upon shipment of the product to the customer. | |||||||||||||
Revenues exclude any value added or other local taxes, intercompany sales and trade discounts. Shipping and handling costs are included in cost of sales. Royalty revenues are recognized when the royalty is earned. | |||||||||||||
The process for estimating the ultimate collection of accounts receivable involves significant assumptions and judgments. Historical collection and payor reimbursement experience is an integral part of the estimation process related to reserves for doubtful accounts and the establishment of contractual allowances. Accounts receivable are analyzed on a quarterly basis to assess the adequacy of both reserves for doubtful accounts and contractual allowances. Revisions in allowances for doubtful accounts estimates are recorded as an adjustment to bad debt expense within sales and marketing expenses, and contractual allowances are recorded as an adjustment to revenue. In the judgment of management, adequate allowances have been provided for doubtful accounts and contractual allowances. These estimates are periodically tested against actual collection experience. | |||||||||||||
Sale of accounts receivable | ' | ||||||||||||
(l) | Sale of accounts receivable | ||||||||||||
The Company will generally sell receivables from certain Italian hospitals each year. The estimated related fee for 2012 was $0.6 million which is recorded as interest expense. Trade accounts receivables sold without recourse are removed from the balance sheet at the time of sale. | |||||||||||||
Share-based compensation | ' | ||||||||||||
(m) | Share-based compensation | ||||||||||||
The fair value of stock options is determined using the Black-Scholes valuation model. Such value is recognized as expense over the service period net of estimated forfeitures. | |||||||||||||
The expected term of options granted is estimated based on a number of factors, including the vesting and expiration terms of the award, historical employee exercise behavior for both options that are currently outstanding and options that have been exercised or are expired, the expected volatility of the Company’s common stock and an employee’s average length of service. The risk-free interest rate is determined based upon a constant U.S. Treasury security rate with a contractual life that approximates the expected term of the option award. Management estimates expected volatility based on the historical volatility of the Company’s stock. The compensation expense recognized for all equity-based awards is net of estimated forfeitures. Forfeitures are estimated based on an analysis of actual option forfeitures. | |||||||||||||
Advertising costs | ' | ||||||||||||
(n) | Advertising costs | ||||||||||||
The Company expenses all advertising costs as incurred. Advertising expense included in sales and marketing expense for the years ended December 31, 2012, 2011 and 2010 was $0.3 million, $0.5 million and $0.6 million, respectively. | |||||||||||||
Research and development costs | ' | ||||||||||||
(o) | Research and development costs | ||||||||||||
Expenditures for research and development are expensed as incurred. Expenditures related to the collaborative arrangement with MTF are expensed based on the terms of the related agreement. Milestone payments made to MTF in 2012 totaled $3 million. | |||||||||||||
Income taxes | ' | ||||||||||||
(p) | Income taxes | ||||||||||||
The Company is subject to income taxes in both the U.S. and foreign jurisdictions, and uses estimates in determining the provision for income taxes. The Company accounts for income taxes using the asset and liability method for accounting and reporting for income taxes. Under this method, deferred tax assets and liabilities are recognized based on temporary differences between the financial reporting and income tax basis of assets and liabilities using statutory rates. This process requires that the Company project the current tax liability and estimate the deferred tax assets and liabilities, including net operating loss and tax credit carryforwards. In assessing the need for a valuation allowance, the Company has considered the recent operating results, future taxable income projections and all prudent and feasible tax planning strategies. | |||||||||||||
The Company accounts for uncertain tax positions in accordance with ASC Topic 740, Income Taxes, which contains a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company re-evaluates income tax positions periodically to consider factors such as changes in facts or circumstances, changes in or interpretations of tax law, effectively settled issues under audit, and new audit activity. Such a change in recognition or measurement would result in recognition of a tax benefit or an additional charge to the tax provision. | |||||||||||||
The Company includes imputed interest related to tax issues as part of income tax expense in our consolidated financial statements. The Company records any applicable penalties related to tax issues within the income tax provision. | |||||||||||||
Net income (loss) per common share | ' | ||||||||||||
(q) | Net income (loss) per common share | ||||||||||||
Net income (loss) per common share—basic is computed using the weighted average number of common shares outstanding during each of the respective years. Net income (loss) per common share—diluted is computed using the weighted average number of common and common equivalent shares outstanding during each of the respective years using the “treasury stock” method, if dilutive. Common equivalent shares represent the dilutive effect of the assumed exercise of outstanding share options (see Note 20). The only differences between basic and diluted shares result from the assumed exercise of certain outstanding share options. | |||||||||||||
Financial Instruments and Concentration of Credit Risk | ' | ||||||||||||
(r) | Financial Instruments and Concentration of Credit Risk | ||||||||||||
Financial instruments that could subject the Company to a concentration of credit risk consist primarily of cash and cash equivalents and accounts receivable. Generally, the cash is held at large financial institutions and our cash equivalents consist of highly liquid money market funds. The Company performs ongoing credit evaluations of the customers, generally do not require collateral and maintain a reserve for potential credit losses. The Company believes that a concentration of credit risk related to the accounts receivable is limited because the customers are geographically dispersed and the end users are diversified across several industries. | |||||||||||||
Net sales to our customers and distributors based in Europe were approximately $55 million in 2012 which results in a substantial portion of our trade accounts receivable balance as of December 31, 2012. It is at least reasonably possible that changes in global economic conditions and/or local operating and economic conditions in the regions these distributors operate, or other factors, could affect the future realization of these accounts receivable balances. | |||||||||||||
Recently Issued Accounting Standards | ' | ||||||||||||
(s) | Recently Issued Accounting Standards | ||||||||||||
In July 2012, the FASB issued ASU No. 2012-02, Intangibles—Goodwill and Other (Topic 350). The standard is intended to reduce the cost and complexity of performing an impairment test for indefinite-lived intangible assets by simplifying how an entity tests those assets for impairment and to improve consistency in impairment testing guidance among long-lived asset categories. The amendments permit an entity to first assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform the quantitative impairment test in accordance with Subtopic 350-30, Intangibles—Goodwill and Other—General Intangibles Other than Goodwill. The more-likely-than-not threshold is defined as having a likelihood of more than 50 percent. The amendments are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. The Company adopted this ASU as of December 31, 2012 and it did not have a material impact on the Company’s consolidated financial statements. | |||||||||||||
On June 16, 2011, the FASB issued ASU No. 2011-05, Presentation of Comprehensive Income. This ASU eliminates the current option to present other comprehensive income and its components in the statement of changes in shareholders’ equity and increases the prominence of other comprehensive income in the statements by providing an alternative to present the components of net income and comprehensive income as either one continuous or two separate but consecutive financial statements. Companies are also required to present reclassification adjustments for items that are reclassified from other comprehensive income to net income within these statements. This standard is to be applied retrospectively and is effective for fiscal years beginning after December 15, 2011 with early adoption permitted. The Company adopted this ASU as of March 31, 2012 and it did not have a material impact on the Company’s consolidated financial statements. |
Summary_of_significant_account2
Summary of significant accounting policies (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Schedule of Useful Lives | ' | ||||||||||||
The useful lives are as follows: | |||||||||||||
Years | |||||||||||||
Buildings | 25 to 33 | ||||||||||||
Plant, equipment and instrumentation | 2 to 10 | ||||||||||||
Furniture and fixtures | 4 to 8 | ||||||||||||
Components of Changes in Accumulated Other Comprehensive Income | ' | ||||||||||||
The components of and changes in accumulated other comprehensive income are as follows: | |||||||||||||
(U.S. Dollars, in thousands) | Foreign Currency | Fair Value of | Accumulated Other | ||||||||||
Translation | Cross- | Comprehensive | |||||||||||
Adjustments | Currency Swaps | Income (Loss) | |||||||||||
Balance at December 31, 2010 (Restated) | $ | 6,125 | $ | 305 | $ | 6,430 | |||||||
Unrealized loss on cross-currency swaps, net of tax benefit of $256 | — | (437 | ) | (437 | ) | ||||||||
Foreign currency translation adjustment (1) | (2,279 | ) | — | (2,279 | ) | ||||||||
Balance at December 31, 2011 (Restated) | 3,846 | (132 | ) | 3,714 | |||||||||
Unrealized gain on cross-currency swaps, net of tax of $153 | — | 263 | 263 | ||||||||||
Foreign currency translation adjustment (1) | 768 | — | 768 | ||||||||||
Balance at December 31, 2012 (Restated) | $ | 4,614 | $ | 131 | $ | 4,745 | |||||||
-1 | As the cash generally remains permanently invested in the non U.S. dollar denominated foreign subsidiaries, no deferred taxes are recognized on the related foreign currency translation adjustment. |
Restatement_of_the_Consolidate1
Restatement of the Consolidated Financial Statements (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||||||||||
Text Block [Abstract] | ' | ||||||||||||||||||||||||||||
Adjustments to Previously Filed Consolidated Income Statements | ' | ||||||||||||||||||||||||||||
The results of the adjustments to the Company’s previously filed consolidated statements of operations detailed above are summarized in the tables below. The tax effect of the adjustments is estimated based on the Company’s effective tax rate. | |||||||||||||||||||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 462,320 | $ | (14,777 | ) | $ | — | $ | — | $ | 38 | $ | (14,739 | ) | $ | 447,581 | |||||||||||||
Cost of sales | 86,492 | (2,032 | ) | 5,647 | 8,190 | (44 | ) | 11,761 | 98,253 | ||||||||||||||||||||
Gross profit | 375,828 | (12,745 | ) | (5,647 | ) | (8,190 | ) | 82 | (26,500 | ) | 349,328 | ||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,343 | (6,629 | ) | — | (8,190 | ) | 1,607 | (13,212 | ) | 187,131 | |||||||||||||||||||
General and administrative | 53,827 | (2 | ) | — | — | (434 | ) | (436 | ) | 53,391 | |||||||||||||||||||
Research and development | 28,577 | — | — | — | — | — | 28,577 | ||||||||||||||||||||||
Amortization of intangibles assets | 2,098 | — | — | — | 200 | 200 | 2,298 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | 1,973 | — | — | — | (678 | ) | (678 | ) | 1,295 | ||||||||||||||||||||
286,818 | (6,631 | ) | — | (8,190 | ) | 695 | (14,126 | ) | 272,692 | ||||||||||||||||||||
Operating income | 89,010 | (6,114 | ) | (5,647 | ) | — | (613 | ) | (12,374 | ) | 76,636 | ||||||||||||||||||
Other income and (expense) | (6,282 | ) | — | — | — | (166 | ) | (166 | ) | (6,448 | ) | ||||||||||||||||||
Income before income taxes | 82,728 | (6,114 | ) | (5,647 | ) | — | (779 | ) | (12,540 | ) | 70,188 | ||||||||||||||||||
Income tax expense | (28,792 | ) | 1,782 | 1,645 | — | 227 | 3,654 | (25,138 | ) | ||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 53,936 | $ | (4,332 | ) | $ | (4,002 | ) | $ | — | $ | (552 | ) | $ | (8,886 | ) | $ | 45,050 | |||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 470,121 | $ | (29,135 | ) | $ | — | $ | — | $ | 985 | $ | (28,150 | ) | $ | 441,971 | |||||||||||||
Cost of sales | 92,619 | (8,289 | ) | 3,377 | 7,713 | 107 | 2,908 | 95,527 | |||||||||||||||||||||
Gross profit | 377,502 | (20,846 | ) | (3,377 | ) | (7,713 | ) | 878 | (31,058 | ) | 346,444 | ||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,145 | (1,216 | ) | — | (7,713 | ) | 2,295 | (6,634 | ) | 193,511 | |||||||||||||||||||
General and administrative | 64,374 | — | — | — | 107 | 107 | 64,481 | ||||||||||||||||||||||
Research and development | 22,861 | — | — | — | — | — | 22,861 | ||||||||||||||||||||||
Amortization of intangibles assets | 2,350 | — | — | — | 200 | 200 | 2,550 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | 56,463 | — | — | — | 678 | 678 | 57,141 | ||||||||||||||||||||||
346,193 | (1,216 | ) | — | (7,713 | ) | 3,280 | (5,649 | ) | 340,544 | ||||||||||||||||||||
Operating income | 31,309 | (19,630 | ) | (3,377 | ) | — | (2,402 | ) | (25,409 | ) | 5,900 | ||||||||||||||||||
Other income and (expense) | (11,868 | ) | — | — | — | 3,915 | 3,915 | (7,953 | ) | ||||||||||||||||||||
Income (loss) before income taxes | 19,441 | (19,630 | ) | (3,377 | ) | — | 1,513 | (21,494 | ) | (2,053 | ) | ||||||||||||||||||
Income tax expense | (21,181 | ) | 6,408 | 1,102 | — | (494 | ) | 7,016 | (14,165 | ) | |||||||||||||||||||
Net loss from continuing operations, net of tax | $ | (1,740 | ) | $ | (13,222 | ) | $ | (2,275 | ) | $ | — | $ | 1,019 | $ | (14,478 | ) | $ | (16,218 | ) | ||||||||||
Year Ended December 31, 2010 | |||||||||||||||||||||||||||||
Adjustments by Category | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands) | Previously | Distributor | Inventory | Royalties | Other | Total | Restated | ||||||||||||||||||||||
Reported | Revenue | Reserves | Adjustments | ||||||||||||||||||||||||||
Net sales | $ | 460,629 | $ | 2,088 | $ | — | $ | — | $ | (146 | ) | $ | 1,942 | $ | 462,571 | ||||||||||||||
Cost of sales | 90,461 | (323 | ) | 2,281 | 5,386 | (712 | ) | 6,632 | 97,093 | ||||||||||||||||||||
Gross profit | 370,168 | 2,411 | (2,281 | ) | (5,386 | ) | 566 | (4,690 | ) | 365,478 | |||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,835 | (275 | ) | — | (5,386 | ) | 939 | (4,722 | ) | 196,113 | |||||||||||||||||||
General and administrative | 72,912 | — | — | — | 98 | 98 | 73,010 | ||||||||||||||||||||||
Research and development | 27,958 | — | — | — | — | — | 27,958 | ||||||||||||||||||||||
Amortization of intangibles assets | 2,213 | — | — | — | 200 | 200 | 2,413 | ||||||||||||||||||||||
Charges related to U.S. Government resolutions | — | — | — | — | — | — | — | ||||||||||||||||||||||
303,918 | (275 | ) | — | (5,386 | ) | 1,237 | (4,424 | ) | 299,494 | ||||||||||||||||||||
Operating income | 66,250 | 2,686 | (2,281 | ) | — | (671 | ) | (266 | ) | 65,984 | |||||||||||||||||||
Other income and (expense) | (15,886 | ) | — | — | — | 4,930 | 4,930 | (10,956 | ) | ||||||||||||||||||||
Income before income taxes | 50,364 | 2,686 | (2,281 | ) | — | 4,259 | 4,664 | 55,028 | |||||||||||||||||||||
Income tax expense | (22,606 | ) | (821 | ) | 697 | — | (1,301 | ) | (1,425 | ) | (24,031 | ) | |||||||||||||||||
Net income from continuing operations, net of tax | $ | 27,758 | $ | 1,865 | $ | (1,584 | ) | $ | — | $ | 2,958 | $ | 3,239 | $ | 30,997 | ||||||||||||||
Effects of Restatements on Consolidated Balance Sheet | ' | ||||||||||||||||||||||||||||
The effects of the restatements on the Company’s consolidated balance sheet as of December 31, 2012 are as follows: | |||||||||||||||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 31,055 | $ | — | $ | 31,055 | |||||||||||||||||||||||
Restricted cash | 21,314 | — | 21,314 | ||||||||||||||||||||||||||
Trade accounts receivable, less allowances of $13,543 | 150,316 | (43,004 | ) | 107,312 | |||||||||||||||||||||||||
Inventories | 88,744 | (5,371 | ) | 83,373 | |||||||||||||||||||||||||
Deferred income taxes | 16,959 | 16,491 | 33,450 | ||||||||||||||||||||||||||
Escrow receivable | — | — | — | ||||||||||||||||||||||||||
Prepaid expenses and other current assets | 32,056 | 2,023 | 34,079 | ||||||||||||||||||||||||||
Assets held for sale | — | — | — | ||||||||||||||||||||||||||
Total current assets | 340,444 | (29,861 | ) | 310,583 | |||||||||||||||||||||||||
Property, plant and equipment, net | 51,362 | 2,473 | 53,835 | ||||||||||||||||||||||||||
Patents and other intangible assets, net | 6,880 | 410 | 7,290 | ||||||||||||||||||||||||||
Goodwill | 74,388 | — | 74,388 | ||||||||||||||||||||||||||
Deferred income taxes | 19,904 | (1,023 | ) | 18,881 | |||||||||||||||||||||||||
Other long-term assets | 11,303 | (3,383 | ) | 7,920 | |||||||||||||||||||||||||
Total assets | $ | 504,281 | $ | (31,384 | ) | $ | 472,897 | ||||||||||||||||||||||
Liabilities and shareholders’ equity | |||||||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||||||
Bank borrowings | $ | 16 | $ | — | $ | 16 | |||||||||||||||||||||||
Current portion of long-term debt | — | — | — | ||||||||||||||||||||||||||
Trade accounts payable | 21,812 | 763 | 22,575 | ||||||||||||||||||||||||||
Accrued charges related to U.S. Government resolutions | — | — | — | ||||||||||||||||||||||||||
Other current liabilities | 46,969 | (7,375 | ) | 39,594 | |||||||||||||||||||||||||
Liabilities held for sale | — | — | — | ||||||||||||||||||||||||||
Total current liabilities | 68,797 | (6,612 | ) | 62,185 | |||||||||||||||||||||||||
Long-term debt | 20,000 | — | 20,000 | ||||||||||||||||||||||||||
Deferred income taxes | 11,456 | — | 11,456 | ||||||||||||||||||||||||||
Other long-term liabilities | 4,930 | 6,494 | 11,424 | ||||||||||||||||||||||||||
Total liabilities | 105,183 | (118 | ) | 105,065 | |||||||||||||||||||||||||
Contingencies (Note 17) | |||||||||||||||||||||||||||||
Shareholders’ equity | |||||||||||||||||||||||||||||
Common shares $0.10 par value; 50,000,000 shares authorized; 19,339,329 issued and outstanding | 1,934 | — | 1,934 | ||||||||||||||||||||||||||
Additional paid-in capital | 246,111 | 195 | 246,306 | ||||||||||||||||||||||||||
Retained earnings | 148,549 | (33,702 | ) | 114,847 | |||||||||||||||||||||||||
Accumulated other comprehensive income | 2,504 | 2,241 | 4,745 | ||||||||||||||||||||||||||
Total shareholders’ equity | 399,098 | (31,266 | ) | 367,832 | |||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 504,281 | $ | (31,384 | ) | $ | 472,897 | ||||||||||||||||||||||
The effects of the restatements on the Company’s consolidated balance sheet as of December 31, 2011 are as follows: | |||||||||||||||||||||||||||||
As of December 31, 2011 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 33,207 | $ | — | $ | 33,207 | |||||||||||||||||||||||
Restricted cash | 45,476 | — | 45,476 | ||||||||||||||||||||||||||
Trade accounts receivable, less allowances of $9,341 | 132,828 | (32,940 | ) | 99,888 | |||||||||||||||||||||||||
Inventories | 82,969 | (1,441 | ) | 81,528 | |||||||||||||||||||||||||
Deferred income taxes | 16,349 | 19,964 | 36,313 | ||||||||||||||||||||||||||
Escrow receivable | 41,537 | — | 41,537 | ||||||||||||||||||||||||||
Prepaid expenses and other current assets | 26,069 | (4,070 | ) | 21,999 | |||||||||||||||||||||||||
Assets held for sale | 171,185 | — | 171,185 | ||||||||||||||||||||||||||
Total current assets | 549,620 | (18,487 | ) | 531,133 | |||||||||||||||||||||||||
Property, plant and equipment, net | 43,368 | 2,769 | 46,137 | ||||||||||||||||||||||||||
Patents and other intangible assets, net | 8,236 | 610 | 8,846 | ||||||||||||||||||||||||||
Goodwill | 73,094 | — | 73,094 | ||||||||||||||||||||||||||
Deferred income taxes | 18,584 | (1,843 | ) | 16,741 | |||||||||||||||||||||||||
Other long-term assets | 11,570 | (2,141 | ) | 9,429 | |||||||||||||||||||||||||
Total assets | $ | 704,472 | $ | (19,092 | ) | $ | 685,380 | ||||||||||||||||||||||
Liabilities and shareholders’ equity | |||||||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||||||
Bank borrowings | $ | 1,318 | $ | — | $ | 1,318 | |||||||||||||||||||||||
Current portion of long-term debt | 17,500 | — | 17,500 | ||||||||||||||||||||||||||
Trade accounts payable | 16,488 | 1,743 | 18,231 | ||||||||||||||||||||||||||
Accrued charges related to U.S. Government resolutions | 82,500 | 638 | 83,138 | ||||||||||||||||||||||||||
Other current liabilities | 45,327 | (4,491 | ) | 40,836 | |||||||||||||||||||||||||
Liabilities held for sale | 22,676 | — | 22,676 | ||||||||||||||||||||||||||
Total current liabilities | 185,809 | (2,110 | ) | 183,699 | |||||||||||||||||||||||||
Long-term debt | 191,195 | — | 191,195 | ||||||||||||||||||||||||||
Deferred income taxes | 9,778 | 9,778 | |||||||||||||||||||||||||||
Other long-term liabilities | 2,519 | 6,115 | 8,634 | ||||||||||||||||||||||||||
Total liabilities | 389,301 | 4,005 | 393,306 | ||||||||||||||||||||||||||
Contingencies (Note 17) | |||||||||||||||||||||||||||||
Shareholders’ equity | |||||||||||||||||||||||||||||
Common shares $0.10 par value; 50,000,000 shares authorized; 18,465,444 issued and outstanding | 1,846 | — | 1,846 | ||||||||||||||||||||||||||
Additional paid-in capital | 214,310 | 195 | 214,505 | ||||||||||||||||||||||||||
Retained earnings | 97,254 | (25,245 | ) | 72,009 | |||||||||||||||||||||||||
Accumulated other comprehensive income | 1,761 | 1,953 | 3,714 | ||||||||||||||||||||||||||
Total shareholders’ equity | 315,171 | (23,097 | ) | 292,074 | |||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 704,472 | $ | (19,092 | ) | $ | 685,380 | ||||||||||||||||||||||
Effects of Restatements of Consolidated Statement of Operations and Comprehensive Income (Loss) | ' | ||||||||||||||||||||||||||||
The effects of the restatements on the Company’s consolidated statement of operations and comprehensive income for the year ended December 31, 2012 are as follows: | |||||||||||||||||||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 415,850 | (14,811 | ) | $ | 401,039 | |||||||||||||||||||||||
Marketing service fees | 46,470 | 72 | 46,542 | ||||||||||||||||||||||||||
Net sales | 462,320 | (14,739 | ) | 447,581 | |||||||||||||||||||||||||
Cost of sales | 86,492 | 11,761 | 98,253 | ||||||||||||||||||||||||||
Gross profit | 375,828 | (26,500 | ) | 349,328 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,343 | (13,212 | ) | 187,131 | |||||||||||||||||||||||||
General and administrative | 53,827 | (436 | ) | 53,391 | |||||||||||||||||||||||||
Research and development | 28,577 | — | 28,577 | ||||||||||||||||||||||||||
Amortization of intangible assets | 2,098 | 200 | 2,298 | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions (Note 17) | 1,973 | (678 | ) | 1,295 | |||||||||||||||||||||||||
286,818 | (14,126 | ) | 272,692 | ||||||||||||||||||||||||||
Operating income | 89,010 | (12,374 | ) | 76,636 | |||||||||||||||||||||||||
Other income and (expense) | |||||||||||||||||||||||||||||
Interest expense, net | (4,577 | ) | (166 | ) | (4,743 | ) | |||||||||||||||||||||||
Other expense | (1,705 | ) | — | (1,705 | ) | ||||||||||||||||||||||||
(6,282 | ) | (166 | ) | (6,448 | ) | ||||||||||||||||||||||||
Income before income taxes | 82,728 | (12,540 | ) | 70,188 | |||||||||||||||||||||||||
Income tax expense | (28,792 | ) | 3,654 | (25,138 | ) | ||||||||||||||||||||||||
Net income from continuing operations, net of tax | 53,936 | (8,886 | ) | 45,050 | |||||||||||||||||||||||||
Discontinued operations (Note 16) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | 1,345 | — | 1,345 | ||||||||||||||||||||||||||
Gain on sale of vascular operations, net of tax (Note 22) | — | — | — | ||||||||||||||||||||||||||
Loss from discontinued operations | (4,012 | ) | 1,018 | (2,994 | ) | ||||||||||||||||||||||||
Income tax benefit (expense) | 26 | (589 | ) | (563 | ) | ||||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (2,641 | ) | 429 | (2,212 | ) | ||||||||||||||||||||||||
Net income | $ | 51,295 | (8,457 | ) | $ | 42,838 | |||||||||||||||||||||||
Net income (loss) per common share—basic: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 2.84 | (0.47 | ) | $ | 2.37 | |||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.14 | ) | 0.02 | (0.12 | ) | ||||||||||||||||||||||||
Net income per common share—basic | $ | 2.7 | (0.45 | ) | $ | 2.25 | |||||||||||||||||||||||
Net income (loss) per common share—diluted: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 2.78 | (0.46 | ) | $ | 2.32 | |||||||||||||||||||||||
Net loss from discontinued operations, net of tax | (0.14 | ) | 0.03 | (0.11 | ) | ||||||||||||||||||||||||
Net income per common share—diluted: | $ | 2.64 | (0.43 | ) | $ | 2.21 | |||||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 18,977,263 | — | 18,977,263 | ||||||||||||||||||||||||||
Diluted | 19,390,413 | — | 19,390,413 | ||||||||||||||||||||||||||
Other comprehensive income, before tax: | |||||||||||||||||||||||||||||
Translation adjustment | $ | 480 | 288 | $ | 768 | ||||||||||||||||||||||||
Unrealized gain on derivative instrument | 416 | — | 416 | ||||||||||||||||||||||||||
Other comprehensive income, before tax | 896 | 288 | 1,184 | ||||||||||||||||||||||||||
Income tax expense related to components of other comprehensive income | (153 | ) | — | (153 | ) | ||||||||||||||||||||||||
Other comprehensive income, net of tax | 743 | 288 | 1,031 | ||||||||||||||||||||||||||
Comprehensive income | $ | 52,038 | (8,169 | ) | $ | 43,869 | |||||||||||||||||||||||
The effects of the restatements on the Company’s consolidated statement of operations and comprehensive loss for the year ended December 31, 2011 are as follows: | |||||||||||||||||||||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 432,975 | (27,828 | ) | $ | 405,147 | |||||||||||||||||||||||
Marketing service fees | 37,146 | (322 | ) | 36,824 | |||||||||||||||||||||||||
Net sales | 470,121 | (28,150 | ) | 441,971 | |||||||||||||||||||||||||
Cost of sales | 92,619 | 2,908 | 95,527 | ||||||||||||||||||||||||||
Gross profit | 377,502 | (31,058 | ) | 346,444 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,145 | (6,634 | ) | 193,511 | |||||||||||||||||||||||||
General and administrative | 64,374 | 107 | 64,481 | ||||||||||||||||||||||||||
Research and development | 22,861 | — | 22,861 | ||||||||||||||||||||||||||
Amortization of intangible assets | 2,350 | 200 | 2,550 | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions (Note 17) | 56,463 | 678 | 57,141 | ||||||||||||||||||||||||||
346,193 | (5,649 | ) | 340,544 | ||||||||||||||||||||||||||
Operating income | 31,309 | (25,409 | ) | 5,900 | |||||||||||||||||||||||||
Other income and (expense) | |||||||||||||||||||||||||||||
Interest expense, net | (9,456 | ) | 3,915 | (5,541 | ) | ||||||||||||||||||||||||
Other expense | (2,412 | ) | — | (2,412 | ) | ||||||||||||||||||||||||
(11,868 | ) | 3,915 | (7,953 | ) | |||||||||||||||||||||||||
Income (loss) before income taxes | 19,441 | (21,494 | ) | (2,053 | ) | ||||||||||||||||||||||||
Income tax expense | (21,181 | ) | 7,016 | (14,165 | ) | ||||||||||||||||||||||||
Net loss from continuing operations, net of tax | (1,740 | ) | (14,478 | ) | (16,218 | ) | |||||||||||||||||||||||
Discontinued operations (Note 16) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | — | — | — | ||||||||||||||||||||||||||
Gain on sale of vascular operations, net of tax (Note 22) | — | — | — | ||||||||||||||||||||||||||
Income (loss) from discontinued operations | 1,263 | (3,968 | ) | (2,705 | ) | ||||||||||||||||||||||||
Income tax (expense) benefit | (596 | ) | 1,409 | 813 | |||||||||||||||||||||||||
Net income (loss) from discontinued operations, net of tax | 667 | (2,559 | ) | (1,892 | ) | ||||||||||||||||||||||||
Net loss | $ | (1,073 | ) | (17,037 | ) | $ | (18,110 | ) | |||||||||||||||||||||
Net income (loss) per common share—basic: | |||||||||||||||||||||||||||||
Net loss from continuing operations, net of tax | $ | (0.10 | ) | (0.79 | ) | $ | (0.89 | ) | |||||||||||||||||||||
Net income (loss) from discontinued operations, net of tax | 0.04 | (0.14 | ) | (0.10 | ) | ||||||||||||||||||||||||
Net loss per common share—basic | $ | (0.06 | ) | (0.93 | ) | $ | (0.99 | ) | |||||||||||||||||||||
Net income (loss) per common share—diluted: | |||||||||||||||||||||||||||||
Net loss from continuing operations, net of tax | $ | (0.10 | ) | (0.79 | ) | $ | (0.89 | ) | |||||||||||||||||||||
Net income (loss) from discontinued operations, net of tax | 0.04 | (0.14 | ) | (0.10 | ) | ||||||||||||||||||||||||
Net loss per common share—diluted: | $ | (0.06 | ) | (0.93 | ) | $ | (0.99 | ) | |||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 18,219,343 | — | 18,219,343 | ||||||||||||||||||||||||||
Diluted | 18,219,343 | — | 18,219,343 | ||||||||||||||||||||||||||
Other comprehensive loss, before tax: | |||||||||||||||||||||||||||||
Translation adjustment | $ | (3,192 | ) | 913 | $ | (2,279 | ) | ||||||||||||||||||||||
Unrealized loss on derivative instrument | (693 | ) | — | (693 | ) | ||||||||||||||||||||||||
Other comprehensive loss, before tax | (3,885 | ) | 913 | (2,972 | ) | ||||||||||||||||||||||||
Income tax benefit related to components of other comprehensive income | 256 | — | 256 | ||||||||||||||||||||||||||
Other comprehensive loss, net of tax | (3,629 | ) | 913 | (2,716 | ) | ||||||||||||||||||||||||
Comprehensive loss | $ | (4,702 | ) | (16,124 | ) | $ | (20,826 | ) | |||||||||||||||||||||
The effects of the restatements on the Company’s consolidated statement of operations and comprehensive income for the year ended December 31, 2010 are as follows: | |||||||||||||||||||||||||||||
Year Ended December 31, 2010 | |||||||||||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | Previously | Adjustments | Restated | ||||||||||||||||||||||||||
Reported | |||||||||||||||||||||||||||||
Product sales | $ | 430,783 | 2,062 | $ | 432,845 | ||||||||||||||||||||||||
Marketing service fees | 29,846 | (120 | ) | 29,726 | |||||||||||||||||||||||||
Net sales | 460,629 | 1,942 | 462,571 | ||||||||||||||||||||||||||
Cost of sales | 90,461 | 6,632 | 97,093 | ||||||||||||||||||||||||||
Gross profit | 370,168 | (4,690 | ) | 365,478 | |||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||
Sales and marketing | 200,835 | (4,722 | ) | 196,113 | |||||||||||||||||||||||||
General and administrative | 72,912 | 98 | 73,010 | ||||||||||||||||||||||||||
Research and development | 27,958 | — | 27,958 | ||||||||||||||||||||||||||
Amortization of intangible assets | 2,213 | 200 | 2,413 | ||||||||||||||||||||||||||
Charges related to U.S. Government resolutions (Note 17) | — | — | — | ||||||||||||||||||||||||||
303,918 | (4,424 | ) | 299,494 | ||||||||||||||||||||||||||
Operating income | 66,250 | (266 | ) | 65,984 | |||||||||||||||||||||||||
Other income and (expense) | |||||||||||||||||||||||||||||
Interest expense, net | (16,217 | ) | 4,930 | (11,287 | ) | ||||||||||||||||||||||||
Other expense | 331 | — | 331 | ||||||||||||||||||||||||||
(15,886 | ) | 4,930 | (10,956 | ) | |||||||||||||||||||||||||
Income before income taxes | 50,364 | 4,664 | 55,028 | ||||||||||||||||||||||||||
Income tax expense | (22,606 | ) | (1,425 | ) | (24,031 | ) | |||||||||||||||||||||||
Net income from continuing operations, net of tax | 27,758 | 3,239 | 30,997 | ||||||||||||||||||||||||||
Discontinued operations (Note 16) | |||||||||||||||||||||||||||||
Gain on sale of Breg, Inc., net of tax | — | — | — | ||||||||||||||||||||||||||
Gain on sale of vascular operations, net of tax (Note 22) | 12,019 | (3,498 | ) | 8,521 | |||||||||||||||||||||||||
Income from discontinued operations | 10,015 | (4,926 | ) | 5,089 | |||||||||||||||||||||||||
Income tax expense | (5,584 | ) | 5,273 | (311 | ) | ||||||||||||||||||||||||
Net income from discontinued operations, net of tax | 16,450 | (3,151 | ) | 13,299 | |||||||||||||||||||||||||
Net income | $ | 44,208 | 88 | $ | 44,296 | ||||||||||||||||||||||||
Net income per common share—basic: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 1.58 | 0.18 | $ | 1.76 | ||||||||||||||||||||||||
Net income from discontinued operations, net of tax | 0.93 | (0.17 | ) | 0.76 | |||||||||||||||||||||||||
Net income per common share—basic | $ | 2.51 | 0.01 | $ | 2.52 | ||||||||||||||||||||||||
Net income per common share—diluted: | |||||||||||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 1.55 | 0.18 | $ | 1.73 | ||||||||||||||||||||||||
Net income from discontinued operations, net of tax | 0.92 | (0.18 | ) | 0.74 | |||||||||||||||||||||||||
Net income per common share—diluted: | $ | 2.47 | — | $ | 2.47 | ||||||||||||||||||||||||
Weighted average number of common shares: | |||||||||||||||||||||||||||||
Basic | 17,601,956 | — | 17,601,956 | ||||||||||||||||||||||||||
Diluted | 17,913,545 | — | 17,913,545 | ||||||||||||||||||||||||||
Other comprehensive income (loss), before tax: | |||||||||||||||||||||||||||||
Translation adjustment | $ | (1,710 | ) | 393 | $ | (1,317 | ) | ||||||||||||||||||||||
Unrealized loss on derivative instrument | (126 | ) | — | (126 | ) | ||||||||||||||||||||||||
Other comprehensive loss, before tax | (1,836 | ) | 393 | (1,443 | ) | ||||||||||||||||||||||||
Income tax benefit related to components of other comprehensive income | 36 | — | 36 | ||||||||||||||||||||||||||
Other comprehensive loss, net of tax | (1,800 | ) | 393 | (1,407 | ) | ||||||||||||||||||||||||
Comprehensive income | $ | 42,408 | 481 | $ | 42,889 | ||||||||||||||||||||||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2012 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Schedule of Inventories | ' | ||||||||
December 31, | |||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||
(Restated) | (Restated) | ||||||||
Raw materials | $ | 7,623 | $ | 9,894 | |||||
Work-in-process | 7,886 | 5,606 | |||||||
Finished products | 28,308 | 27,142 | |||||||
Field inventory | 22,629 | 23,237 | |||||||
Consignment inventory | 6,155 | 6,981 | |||||||
Deferred cost of sales | 10,772 | 8,668 | |||||||
$ | 83,373 | $ | 81,528 | ||||||
Property_plant_and_equipment_T
Property, plant and equipment (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2012 | |||||||||
Property Plant And Equipment [Abstract] | ' | ||||||||
Schedule of Property Plant and Equipment | ' | ||||||||
December 31, | |||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||
(Restated) | (Restated) | ||||||||
Cost | |||||||||
Buildings | $ | 3,911 | $ | 3,829 | |||||
Plant, equipment and instrumentation | 120,982 | 104,782 | |||||||
Furniture and fixtures | 5,567 | 5,697 | |||||||
130,460 | 114,308 | ||||||||
Accumulated depreciation | (76,625 | ) | (68,171 | ) | |||||
$ | 53,835 | $ | 46,137 | ||||||
Patents_and_other_intangible_a1
Patents and other intangible assets (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2012 | |||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||
Schedule of Patents and Other Intangible Assets | ' | ||||||||
December 31, | |||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||
(Restated) | (Restated) | ||||||||
Cost | |||||||||
Patents | $ | 38,905 | $ | 38,893 | |||||
Trademarks—definite lived | 657 | 545 | |||||||
39,562 | 39,438 | ||||||||
Accumulated amortization | |||||||||
Patents | (31,845 | ) | (30,211 | ) | |||||
Trademarks—definite lived | (427 | ) | (381 | ) | |||||
(32,272 | ) | (30,592 | ) | ||||||
Patents and other intangible assets, net | $ | 7,290 | $ | 8,846 | |||||
Goodwill_Tables
Goodwill (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||
Schedule of Changes in Net Carrying Amount of Goodwill | ' | ||||||||||||
The following table presents the changes in the net carrying value of goodwill by reportable segment: | |||||||||||||
(U.S. Dollars, in thousands) | Spine | Orthopedics | Total | ||||||||||
At December 31, 2010 | $ | 41,458 | $ | 32,140 | $ | 73,598 | |||||||
Foreign currency | (39 | ) | (465 | ) | (504 | ) | |||||||
At December 31, 2011 | 41,419 | 31,675 | 73,094 | ||||||||||
Foreign currency | 145 | 1,149 | 1,294 | ||||||||||
At December 31, 2012 | $ | 41,564 | $ | 32,824 | $ | 74,388 | |||||||
Other_current_liabilities_Tabl
Other current liabilities (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2012 | |||||||||
Payables And Accruals [Abstract] | ' | ||||||||
Summary of Other Current Liabilities | ' | ||||||||
December 31, | |||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||
(Restated) | (Restated) | ||||||||
Accrued expenses | $ | 17,452 | $ | 15,002 | |||||
Salaries, bonuses, commissions and related taxes payable | 17,915 | 22,743 | |||||||
Other payables | 4,227 | 3,091 | |||||||
$ | 39,594 | $ | 40,836 | ||||||
Derivative_instruments_Tables
Derivative instruments (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ' | ||||||||||||
Schedule of Fair Values of Derivative Instruments | ' | ||||||||||||
The tables below disclose the types of derivative instruments the Company owns, the classifications and fair values of these instruments within the balance sheet, and the amount of gain (loss) recognized in other comprehensive income (loss) (“OCI”) or net income (loss): | |||||||||||||
(U.S. Dollars, in thousands) | Fair value: favorable | Balance sheet location | |||||||||||
(unfavorable) | |||||||||||||
As of December 31, 2012 | |||||||||||||
Cross-currency swap | $ | 305 | Other long-term assets | ||||||||||
As of December 31, 2011 | |||||||||||||
Cross-currency swap | $ | 1,011 | Other long-term assets | ||||||||||
Schedule of Gain (Loss) Recognized on Derivative Instruments | ' | ||||||||||||
For the year ended | |||||||||||||
December 31, | |||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||
Interest rate swap gain recognized in net income (loss) | $ | — | $ | — | $ | 1,254 | |||||||
Cross-currency swap gain (loss) recorded in other comprehensive income (loss), net of taxes | 263 | (437 | ) | (90 | ) |
Fair_value_measurements_Tables
Fair value measurements (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Schedule of Financial Assets and Liabilities Recorded at Fair Value on Recurring Basis | ' | ||||||||||||||||
The fair value of the Company’s financial assets and liabilities on a recurring basis were as follows: | |||||||||||||||||
(U.S. Dollars, in thousands) | Balance | Level 1 | Level 2 | Level 3 | |||||||||||||
December 31, | |||||||||||||||||
2012 | |||||||||||||||||
Derivative Financial Instruments (1) | |||||||||||||||||
Cash Flow Hedges | |||||||||||||||||
Cross currency hedge | $ | 305 | $ | — | $ | 305 | $ | — | |||||||||
(U.S. Dollars, in thousands) | Balance | Level 1 | Level 2 | Level 3 | |||||||||||||
December 31, | |||||||||||||||||
2011 | |||||||||||||||||
Derivative Financial Instruments (1) | |||||||||||||||||
Cash Flow Hedges | |||||||||||||||||
Cross currency hedge | $ | 1,011 | $ | — | $ | 1,011 | $ | — | |||||||||
-1 | See Note 10, “Derivative Instruments”. |
Commitments_Tables
Commitments (Tables) | 12 Months Ended | ||||
Dec. 31, 2012 | |||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||
Schedule of Future Minimum Lease Payments Under Operating Leases, Net of Amount to be Received Under Sub Leases | ' | ||||
Future minimum lease payments under operating leases, net of amounts to be received under sub-leases, as of December 31, 2012 are as follows: | |||||
(U.S. Dollars in thousands) | |||||
2013 | $ | 3,340 | |||
2014 | 2,992 | ||||
2015 | 2,816 | ||||
2016 | 2,677 | ||||
2017 | 2,620 | ||||
Thereafter | 2,624 | ||||
Total | $ | 17,069 | |||
Business_segment_information_T
Business segment information (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||||||||||
Business Segments by GBU | ' | ||||||||||||||||||||||||
Business Segments by GBU: | |||||||||||||||||||||||||
The table below presents external net sales for continuing operations by GBU reporting segment. Net sales includes product sales and marketing service fees which is comprised of sales of Trinity Evolution® in spine and orthopedic applications. | |||||||||||||||||||||||||
External Net Sales by GBU | |||||||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
Net Sales | Percent of | Net Sales | Percent of | Net Sales | Percent of | ||||||||||||||||||||
Total Net | Total Net | Total Net | |||||||||||||||||||||||
Sales | Sales | Sales | |||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | (Restated) | (Restated) | (Restated) | ||||||||||||||||||||
Spine | |||||||||||||||||||||||||
Spine Repair Implants and Regenerative Biologics | $ | 142,829 | 32 | % | $ | 124,415 | 28 | % | $ | 132,938 | 29 | % | |||||||||||||
Spine Regenerative Stimulation | 159,289 | 36 | % | 160,946 | 37 | % | 172,574 | 37 | % | ||||||||||||||||
Total Spine | 302,118 | 68 | % | 285,361 | 65 | % | 305,512 | 66 | % | ||||||||||||||||
Orthopedics | 145,463 | 32 | % | 156,610 | 35 | % | 157,059 | 34 | % | ||||||||||||||||
Total Net Sales | $ | 447,581 | 100 | % | $ | 441,971 | 100 | % | $ | 462,571 | 100 | % | |||||||||||||
Operating Income (Loss) by GBU | ' | ||||||||||||||||||||||||
The table below presents operating income (loss) from continuing operations by GBU reporting segment: | |||||||||||||||||||||||||
Operating Income (Loss) | |||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||||||||||
Spine (1) | $ | 80,528 | $ | 31,173 | $ | 78,451 | |||||||||||||||||||
Orthopedics (2) | 13,197 | 3,779 | 7,847 | ||||||||||||||||||||||
Corporate (3) | (17,089 | ) | (29,052 | ) | (20,314 | ) | |||||||||||||||||||
Total | $ | 76,636 | $ | 5,900 | $ | 65,984 | |||||||||||||||||||
-1 | For 2011, the operating income for the Spine GBU included $43.1 million of expenses in connection with charges related to U.S. Government resolutions. | ||||||||||||||||||||||||
-2 | For 2011, the operating income for the Orthopedics GBU included $6.5 million of expenses in connection with charges related to U.S. Government resolutions. | ||||||||||||||||||||||||
-3 | For 2011, the operating loss for the Corporate GBU included $7.5 million of expenses in connection with charges related to U.S. Government inquiries and $3.2 million of senior management succession charges. | ||||||||||||||||||||||||
Selected Financial Information by Reporting Segment | ' | ||||||||||||||||||||||||
The following table presents depreciation and amortization for continuing operations by GBU reporting segment: | |||||||||||||||||||||||||
Depreciation and amortization by GBU | |||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||||||||||
Spine | $ | 12,260 | $ | 11,091 | $ | 8,973 | |||||||||||||||||||
Orthopedics | 5,605 | 5,506 | 6,282 | ||||||||||||||||||||||
Corporate | 280 | 263 | 126 | ||||||||||||||||||||||
Total | $ | 18,145 | $ | 16,860 | $ | 15,381 | |||||||||||||||||||
Summary of Net Sales by Geographic Destination | ' | ||||||||||||||||||||||||
Analysis of net sales by geographic destination: | |||||||||||||||||||||||||
Net Sales by Geographic Destination | |||||||||||||||||||||||||
Year Ended December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||||||||||
U.S. | $ | 334,624 | $ | 328,585 | $ | 340,328 | |||||||||||||||||||
International: | |||||||||||||||||||||||||
U.K. | 8,431 | 8,206 | 12,509 | ||||||||||||||||||||||
Italy | 18,742 | 17,447 | 19,181 | ||||||||||||||||||||||
Brazil | 31,166 | 34,424 | 31,112 | ||||||||||||||||||||||
Other | 54,618 | 53,309 | 59,441 | ||||||||||||||||||||||
Total international | 112,957 | 113,386 | 122,243 | ||||||||||||||||||||||
Total net sales | $ | 447,581 | $ | 441,971 | $ | 462,571 | |||||||||||||||||||
Analysis of Property, Plant and Equipment of Reporting Segments by Geographic Area | ' | ||||||||||||||||||||||||
Analysis of property, plant and equipment by geographic area: | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||||||||||||||||||
(Restated) | (Restated) | ||||||||||||||||||||||||
U.S. | $ | 39,554 | $ | 33,575 | |||||||||||||||||||||
Italy | 7,617 | 7,663 | |||||||||||||||||||||||
U.K. | 1,402 | 1,449 | |||||||||||||||||||||||
Brazil | 3,421 | 2,532 | |||||||||||||||||||||||
Others | 1,841 | 918 | |||||||||||||||||||||||
Total | $ | 53,835 | $ | 46,137 | |||||||||||||||||||||
Income_taxes_Tables
Income taxes (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||||||||||||||
Schedule of Provision for (Benefit from) Income Taxes on Continuing Operations | ' | ||||||||||||||||||||||||
The provision for (benefit from) income taxes on continuing operations in the accompanying consolidated statements of operations consists of the following: | |||||||||||||||||||||||||
Year Ended | |||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
(Restated) | (Restated) | (Restated) | |||||||||||||||||||||||
U.S. | |||||||||||||||||||||||||
Current | $ | 17,897 | $ | 25,148 | $ | 19,336 | |||||||||||||||||||
Deferred | 1,788 | (12,657 | ) | 2,282 | |||||||||||||||||||||
Total U.S | 19,685 | 12,491 | 21,618 | ||||||||||||||||||||||
Non-U.S. | |||||||||||||||||||||||||
Current | 4,609 | 2,735 | 253 | ||||||||||||||||||||||
Deferred | 844 | (1,061 | ) | 2,160 | |||||||||||||||||||||
5,453 | 1,674 | 2,413 | |||||||||||||||||||||||
Total tax expense | $ | 25,138 | $ | 14,165 | $ | 24,031 | |||||||||||||||||||
Schedule of Tax Effects of Significant Temporary Differences Comprising Deferred Tax Assets and Liabilities | ' | ||||||||||||||||||||||||
The tax effects of the significant temporary differences, which comprise the deferred tax assets and liabilities, are as follows: | |||||||||||||||||||||||||
Year Ended | |||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||||||||||||||||||
(Restated) | (Restated) | ||||||||||||||||||||||||
Intangible assets and goodwill | $ | 5,346 | $ | 5,300 | |||||||||||||||||||||
Inventories and related reserves | 14,020 | 13,756 | |||||||||||||||||||||||
Deferred revenue and cost of sales | 11,682 | 7,631 | |||||||||||||||||||||||
Other accruals and reserves | 3,868 | 10,287 | |||||||||||||||||||||||
Accrued compensation | 3,817 | 4,444 | |||||||||||||||||||||||
Allowance for doubtful accounts | 3,718 | 4,029 | |||||||||||||||||||||||
Accrued interest | 18,229 | 16,123 | |||||||||||||||||||||||
Net operating loss carryforwards | 27,231 | 20,849 | |||||||||||||||||||||||
Other, net | 539 | (349 | ) | ||||||||||||||||||||||
88,450 | 82,070 | ||||||||||||||||||||||||
Valuation allowance | (26,361 | ) | (19,124 | ) | |||||||||||||||||||||
Deferred tax asset | $ | 62,089 | $ | 62,946 | |||||||||||||||||||||
Withholding taxes | (11,456 | ) | (9,778 | ) | |||||||||||||||||||||
Property, plant and equipment | (9,758 | ) | (9,892 | ) | |||||||||||||||||||||
Deferred tax liability | (21,214 | ) | (19,670 | ) | |||||||||||||||||||||
Net deferred tax assets | $ | 40,875 | $ | 43,276 | |||||||||||||||||||||
Schedule of Effective Income Tax Rate Reconciliation for Continuing Operations | ' | ||||||||||||||||||||||||
The rate reconciliation for continuing operations presented below is based on the U.S. federal income tax rate, rather than the parent company’s country of domicile tax rate. Management believes, given the large proportion of taxable income earned in the United States, such disclosure is more meaningful. | |||||||||||||||||||||||||
(US$ in thousands, except percentages) | 2012 | 2011 | 2010 | ||||||||||||||||||||||
Amount | Percent | Amount | Percent | Amount | Percent | ||||||||||||||||||||
(Restated) | (Restated) | (Restated) | (Restated) | (Restated) | (Restated) | ||||||||||||||||||||
Statutory U.S. federal income tax rate | $ | 24,565 | 35 | % | $ | (719 | ) | 35 | % | $ | 19,261 | 35 | % | ||||||||||||
State taxes, net | 1,708 | 2.4 | % | 1,896 | (92.4 | )% | 2,051 | 3.7 | % | ||||||||||||||||
Foreign rate differential | (3,115 | ) | (4.4 | )% | 1,585 | (77.2 | )% | 251 | 0.5 | % | |||||||||||||||
Valuation allowance—foreign losses | 6,183 | 8.8 | % | 4,882 | -237.8 | % | 3,497 | 6.4 | % | ||||||||||||||||
SRL Intangible | (2,214 | ) | (3.2 | )% | (2,421 | ) | 117.9 | % | (2,607 | ) | (4.7 | )% | |||||||||||||
Domestic manufacturing deduction | (1,694 | ) | (2.4 | )% | (1,703 | ) | 82.9 | % | (1,529 | ) | (2.8 | )% | |||||||||||||
Withholding Taxes | 1,679 | 2.4 | % | 1,676 | (81.6 | )% | 1,687 | 3.1 | % | ||||||||||||||||
Settlement of U.S. Government resolutions | (1,260 | ) | (1.8 | )% | 9,520 | (463.7 | )% | — | — | % | |||||||||||||||
Other items, net | (714 | ) | (1.0 | )% | (551 | ) | 26.9 | % | 1,420 | 2.5 | % | ||||||||||||||
Income tax expense/effective rate | $ | 25,138 | 35.8 | % | $ | 14,165 | (690.0 | )% | $ | 24,031 | 43.7 | % | |||||||||||||
Schedule of Gross Unrecognized Tax Benefits (Excluding Interest and Penalties) | ' | ||||||||||||||||||||||||
A reconciliation of the gross unrecognized tax benefits (excluding interest and penalties) for the years ended December 31, 2012 and December 31, 2011 follows: | |||||||||||||||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | |||||||||||||||||||||||
(Restated) | (Restated) | ||||||||||||||||||||||||
Balance as of January 1, | $ | 610 | $ | 569 | |||||||||||||||||||||
Additions for current year tax positions | 793 | 86 | |||||||||||||||||||||||
Decreases for prior year tax positions | (106 | ) | (17 | ) | |||||||||||||||||||||
Expiration of statutes | (108 | ) | (28 | ) | |||||||||||||||||||||
Balance as of December 31, | $ | 1,189 | $ | 610 | |||||||||||||||||||||
Related_parties_Tables
Related parties (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Related Party Transactions [Abstract] | ' | ||||||||||||
Summary of Related Party Balances and Transactions | ' | ||||||||||||
The following table summarizes these related party balances and transactions as of and for the years ended December 31, 2012, 2011 and 2010. | |||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
(U.S. Dollars, in thousands) | 2012 | 2011 | 2010 | ||||||||||
Sales | $ | — | $ | 479 | $ | 3,081 | |||||||
Purchases | — | — | 4,911 | ||||||||||
Accounts payable | — | — | 334 | ||||||||||
Accounts receivable | — | 106 | 676 |
Sale_of_Breg_and_Disposition_o1
Sale of Breg and Disposition of Sports Medicine GBU (Tables) | 12 Months Ended | ||||
Dec. 31, 2012 | |||||
Discontinued Operations And Disposal Groups [Abstract] | ' | ||||
Schedule of Information Related to Sale of Breg | ' | ||||
The following table presents the value of the asset disposition, proceeds received, net of various working capital adjustments and indebtedness and net gain on sale of Breg as shown in the consolidated statement of operations for the year ended December 31, 2012. | |||||
(U.S. Dollars, in thousands) | Total | ||||
Cash proceeds | $ | 157,500 | |||
Less: | |||||
Working Capital | (7,093 | ) | |||
Transaction related expenses | (4,276 | ) | |||
Fair Value of Indemnification | (2,000 | ) | |||
Tangible assets | (8,309 | ) | |||
Intangible assets | (28,164 | ) | |||
Goodwill | (106,200 | ) | |||
Gain on sale of Breg | 1,458 | ||||
Income tax expense | (113 | ) | |||
Gain on sale of Breg, net of taxes | $ | 1,345 | |||
Schedule of Assets and Liabilities of Discontinued Operations | ' | ||||
The assets and liabilities of the discontinued operations are as follows: | |||||
(U.S. Dollars, in thousands) | December 31, | ||||
2011 | |||||
(Restated) | |||||
Assets Held for Sale | |||||
Restricted cash | $ | 1,629 | |||
Trade accounts receivable, less allowance | 13,711 | ||||
Inventories, net | 8,277 | ||||
Property, plant and equipment, net | 8,756 | ||||
Intangible assets, net | 29,279 | ||||
Goodwill | 106,279 | ||||
Deferred income taxes, prepaid expenses and other assets | 3,254 | ||||
Assets Held for Sale | $ | 171,185 | |||
Liabilities Held for Sale | |||||
Trade accounts payable | 3,616 | ||||
Deferred income taxes and other liabilities | 19,060 | ||||
Liabilities Held for Sale | $ | 22,676 | |||
Sharebased_compensation_plans_
Share-based compensation plans (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||||||||||||||
Schedule of Share-Based Compensation by Line Item in Condensed Consolidated Statements of Operations | ' | ||||||||||||||||||||
The following table shows the detail of share-based compensation by line item in the consolidated statements of operations for the years ended December 31, 2012, 2011 and 2010 and the assumptions for each of these years in which grants were awarded: | |||||||||||||||||||||
(U.S. Dollars, in thousands, except assumptions) | Year Ended | Year Ended | Year Ended | ||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||
2012 | 2011 | 2010 (1) | |||||||||||||||||||
Cost of sales | $ | 592 | $ | 153 | $ | 210 | |||||||||||||||
Sales and marketing | 1,550 | 2,031 | 3,505 | ||||||||||||||||||
General and administrative | 4,023 | 4,322 | 4,105 | ||||||||||||||||||
Research and development | 138 | 142 | 318 | ||||||||||||||||||
Total | $ | 6,303 | $ | 6,648 | $ | 8,138 | |||||||||||||||
(U.S. Dollars, in thousands, except assumptions) | Year Ended | Year Ended | Year Ended | ||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||
2012 | 2011 | 2010 (1) | |||||||||||||||||||
Assumptions: | |||||||||||||||||||||
Expected term | 4.50 years | 4.58 years | — | ||||||||||||||||||
Expected volatility | 50.9% – 51.8% | 49.6% – 49.9% | — | ||||||||||||||||||
Risk free interest rate | 0.76% – 0.84% | 0.90% – 2.26% | — | ||||||||||||||||||
Dividend rate | — | — | — | ||||||||||||||||||
Weighted average fair value of options granted during the year | $16.99 | $14.21 | $ | — | |||||||||||||||||
-1 | The Company did not grant any options during 2010. | ||||||||||||||||||||
Schedule of Stock Option Activity | ' | ||||||||||||||||||||
Summaries of the status of the Company’s stock option plans as of December 31, 2012 and 2011 and changes during the year ended December 31, 2012 are presented below: | |||||||||||||||||||||
Options | Weighted Average | Weighted | |||||||||||||||||||
Exercise Price | Average | ||||||||||||||||||||
Remaining | |||||||||||||||||||||
Contractual | |||||||||||||||||||||
Term | |||||||||||||||||||||
Outstanding at December 31, 2011 | 2,559,272 | $ | 33.41 | ||||||||||||||||||
Granted | 347,250 | $ | 40.46 | ||||||||||||||||||
Exercised | (716,564 | ) | $ | 31.5 | |||||||||||||||||
Forfeited | (244,003 | ) | $ | 40.5 | |||||||||||||||||
Outstanding at December 31, 2012 | 1,945,955 | $ | 34.5 | 5.39 | |||||||||||||||||
Vested and expected to vest at December 31, 2012 | 1,903,616 | $ | 34.42 | 5.31 | |||||||||||||||||
Options exercisable at December 31, 2012 | 1,448,293 | 4.2 | |||||||||||||||||||
Schedule of Stock Options Outstanding and Exercisable by Price Range | ' | ||||||||||||||||||||
Outstanding and exercisable by price range as of December 31, 2012 | |||||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||||
Range of Exercise Prices | Number | Weighted | Weighted | Number | Weighted | ||||||||||||||||
Outstanding | Average | Average | Exercisable | Average | |||||||||||||||||
Remaining | Exercise | Exercise | |||||||||||||||||||
Contractual | Price | Price | |||||||||||||||||||
Life | |||||||||||||||||||||
$10.42 – $25.01 | 253,661 | 5.09 | $ | 23.4 | 253,661 | $ | 23.4 | ||||||||||||||
$25.05 – $28.95 | 326,383 | 5.3 | $ | 26.96 | 314,383 | $ | 26.97 | ||||||||||||||
$29.23 – $33.01 | 314,433 | 6.84 | $ | 31.6 | 167,102 | $ | 31.44 | ||||||||||||||
$33.08 – $38.11 | 347,859 | 3.5 | $ | 37.49 | 307,194 | $ | 37.51 | ||||||||||||||
$38.40 – $39.94 | 282,687 | 6.61 | $ | 39.68 | 126,687 | $ | 39.69 | ||||||||||||||
$40.27 – $41.37 | 210,000 | 7.05 | $ | 41.22 | 68,334 | $ | 41.2 | ||||||||||||||
$43.04 – $45.84 | 188,932 | 3.47 | $ | 44.63 | 188,932 | $ | 44.63 | ||||||||||||||
$50.15 – $50.15 | 12,500 | 4.29 | $ | 50.15 | 12,500 | $ | 50.15 | ||||||||||||||
$50.50 – $50.50 | 2,000 | 4.01 | $ | 50.5 | 2,000 | $ | 50.5 | ||||||||||||||
$50.99 – $50.99 | 7,500 | 4.04 | $ | 50.99 | 7,500 | $ | 50.99 | ||||||||||||||
$10.42 – $50.99 | 1,945,955 | 5.39 | $ | 34.5 | 1,448,293 | $ | 33.54 | ||||||||||||||
Schedule of Changes in Restricted Stock | ' | ||||||||||||||||||||
A summary of the status of our restricted stock as of December 31, 2012 and 2011 and changes during the year ended December 31, 2012 are presented below: | |||||||||||||||||||||
Shares | Weighted | ||||||||||||||||||||
Average Grant | |||||||||||||||||||||
Date Fair Value | |||||||||||||||||||||
Non-vested as of December 31, 2011 | 69,000 | $ | 29.23 | ||||||||||||||||||
Granted | 149,500 | $ | 40.93 | ||||||||||||||||||
Vested | (28,336 | ) | $ | 29.23 | |||||||||||||||||
Cancelled | (29,333 | ) | $ | 38.87 | |||||||||||||||||
Non-vested as of December 31, 2012 | 160,831 | $ | 38.34 | ||||||||||||||||||
Earnings_per_share_Tables
Earnings per share (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||
Schedule of Reconciliation of Weighted Average Shares Used in Calculation of Basic and Diluted Earnings Per Share | ' | ||||||||||||
The following is a reconciliation of the weighted average shares used in the basic and diluted net income (loss) per common share computations. | |||||||||||||
Year Ended December 31, | |||||||||||||
2012 | 2011 | 2010 | |||||||||||
Weighted average common shares-basic | 18,977,263 | 18,219,343 | 17,601,956 | ||||||||||
Effect of diluted securities: | |||||||||||||
Unexercised stock options net of treasury share repurchase | 413,150 | — | 311,589 | ||||||||||
Weighted average common share-diluted | 19,390,413 | 18,219,343 | 17,913,545 | ||||||||||
Restructuring_charges_Tables
Restructuring charges (Tables) | 12 Months Ended | ||||
Dec. 31, 2012 | |||||
Restructuring And Related Activities [Abstract] | ' | ||||
Schedule of Changes in Restructuring Liability | ' | ||||
The following table presents changes in the restructuring liability, which is included within Other Current Liabilities in the Company’s consolidated balance sheets as of December 31, 2011 and December 31, 2010: | |||||
(U.S. Dollars, in thousands) | Severance | ||||
Balance at December 31, 2009 | $ | 1,826 | |||
Charges under 2010 plan | 3,550 | ||||
Cash payments | (3,738 | ) | |||
Balance at December 31, 2010 | 1,638 | ||||
Cash payments | (1,638 | ) | |||
Balance at December 31, 2011 | $ | — | |||
Net_gain_on_sale_of_vascular_o1
Net gain on sale of vascular operations (Tables) | 12 Months Ended | ||||
Dec. 31, 2012 | |||||
Text Block [Abstract] | ' | ||||
Schedule of Information Related to Sale of Vascular Operation | ' | ||||
The following table presents the value of the asset disposition, cash proceeds received, net of litigation settlement costs and the net gain on sale of vascular operations as shown in the consolidated statements of operations for the year ended December 31, 2010. | |||||
(U.S. Dollars, in thousands) | Total | ||||
Cash proceeds, net of litigation (1) | $ | 24,215 | |||
Less: | |||||
Transaction related expenses | 2,253 | ||||
Inventory and property, plant and equipment | 2,369 | ||||
Goodwill and intangible assets | 7,574 | ||||
Net gain on sale of vascular operations | 12,019 | ||||
Income tax expense | (3,498 | ) | |||
Net gain on sale of vascular operations, net of taxes | $ | 8,521 | |||
-1 | In conjunction with the sale of the vascular operations, the Company settled an outstanding litigation claim by the former patent holders for $3.5 million. |
Quarterly_financial_data_unaud1
Quarterly financial data (unaudited) (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||||||
Condensed Consolidated Statement of Operations | ' | ||||||||||||||||||||
Condensed Consolidated Statement of Operations | |||||||||||||||||||||
As Restated | |||||||||||||||||||||
(U.S. Dollars, in thousands, except per share data) | |||||||||||||||||||||
1st | 2nd | 3rd | 4th | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
(Restated) | (Restated) | (Restated) | (Restated) | (Restated) | |||||||||||||||||
2012 | |||||||||||||||||||||
Net sales | $ | 108,936 | $ | 113,423 | $ | 107,857 | $ | 117,365 | $ | 447,581 | |||||||||||
Cost of sales | 21,378 | 27,547 | 24,384 | 24,944 | 98,253 | ||||||||||||||||
Gross profit | 87,558 | 85,876 | 83,473 | 92,421 | 349,328 | ||||||||||||||||
Operating expense | 69,638 | 71,578 | 64,668 | 66,808 | 272,692 | ||||||||||||||||
Operating income | 17,920 | 14,298 | 18,805 | 25,613 | 76,636 | ||||||||||||||||
Net income from continuing operations, net of tax | 8,597 | 9,870 | 10,574 | 16,009 | 45,050 | ||||||||||||||||
Net income (loss) from discontinued operations, net of tax | 810 | (2,616 | ) | (5,558 | ) | 5,152 | (2,212 | ) | |||||||||||||
Net income | $ | 9,407 | $ | 7,254 | $ | 5,016 | $ | 21,161 | $ | 42,838 | |||||||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.46 | $ | 0.52 | $ | 0.55 | $ | 0.83 | $ | 2.37 | |||||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.04 | $ | (0.14 | ) | $ | (0.29 | ) | $ | 0.27 | $ | (0.12 | ) | ||||||||
Net income | $ | 0.5 | $ | 0.38 | $ | 0.26 | $ | 1.1 | $ | 2.25 | |||||||||||
Diluted: | |||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.45 | $ | 0.51 | $ | 0.54 | $ | 0.81 | $ | 2.32 | |||||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.04 | $ | (0.14 | ) | $ | (0.29 | ) | $ | 0.26 | $ | (0.11 | ) | ||||||||
Net income | $ | 0.49 | $ | 0.37 | $ | 0.25 | $ | 1.07 | $ | 2.21 | |||||||||||
2011 | |||||||||||||||||||||
Net sales | $ | 103,606 | $ | 108,216 | $ | 111,510 | $ | 118,639 | $ | 441,971 | |||||||||||
Cost of sales | 22,346 | 22,755 | 23,126 | 27,300 | 95,527 | ||||||||||||||||
Gross profit | 81,260 | 85,461 | 88,384 | 91,339 | 346,444 | ||||||||||||||||
Operating expense | 116,860 | 73,102 | 67,417 | 83,165 | 340,544 | ||||||||||||||||
Operating income (loss) | (35,600 | ) | 12,359 | 20,967 | 8,174 | 5,900 | |||||||||||||||
Net income (loss) from continuing operations, net of tax | (41,749 | ) | 6,579 | 11,300 | 7,652 | (16,218 | ) | ||||||||||||||
Net income (loss) from discontinued operations, net of tax | 282 | (1,184 | ) | (1,225 | ) | 235 | (1,892 | ) | |||||||||||||
Net income (loss) | $ | (41,467 | ) (1) | $ | 5,395 | $ | 10,075 | $ | 7,887 | (2) | $ | (18,110 | ) | ||||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (2.33 | ) | $ | 0.36 | $ | 0.61 | $ | 0.42 | $ | (0.89 | ) | |||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.02 | $ | (0.07 | ) | $ | (0.07 | ) | $ | 0.01 | $ | (0.10 | ) | ||||||||
Net income (loss) | $ | (2.31 | ) | $ | 0.29 | $ | 0.54 | $ | 0.43 | $ | (0.99 | ) | |||||||||
Diluted: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (2.33 | ) | $ | 0.35 | $ | 0.6 | $ | 0.41 | $ | (0.89 | ) | |||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.02 | $ | (0.06 | ) | $ | (0.06 | ) | $ | 0.01 | $ | (0.10 | ) | ||||||||
Net income (loss) | $ | (2.31 | ) | $ | 0.29 | $ | 0.54 | $ | 0.42 | $ | (0.99 | ) | |||||||||
-1 | Includes $46 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
-2 | Includes $10.5 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
Condensed Consolidated Statement of Operations | |||||||||||||||||||||
As Previously Reported | |||||||||||||||||||||
(U.S. Dollars, in thousands, except per share data) | |||||||||||||||||||||
1st | 2nd | 3rd | 4th | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
2012 | |||||||||||||||||||||
Net sales | $ | 116,041 | $ | 119,492 | $ | 114,752 | $ | 112,035 | $ | 462,320 | |||||||||||
Cost of sales | 21,939 | 23,676 | 22,373 | 18,504 | 86,492 | ||||||||||||||||
Gross profit | 94,102 | 95,816 | 92,379 | 93,531 | 375,828 | ||||||||||||||||
Operating expense | 71,671 | 75,251 | 70,846 | 69,050 | 286,818 | ||||||||||||||||
Operating income | 22,431 | 20,565 | 21,533 | 24,481 | 89,010 | ||||||||||||||||
Net income from continuing operations, net of tax | 12,215 | 13,967 | 13,118 | 14,636 | 53,936 | ||||||||||||||||
Net income (loss) from discontinued operations, net of tax | (199 | ) | (2,762 | ) | (5,558 | ) | 5,878 | (2,641 | ) | ||||||||||||
Net income | $ | 12,016 | $ | 11,205 | $ | 7,560 | $ | 20,514 | $ | 51,295 | |||||||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.65 | $ | 0.74 | $ | 0.69 | $ | 0.76 | $ | 2.84 | |||||||||||
Net income (loss) from discontinued operations, net of tax | $ | (0.01 | ) | $ | (0.15 | ) | $ | (0.29 | ) | $ | 0.3 | $ | (0.14 | ) | |||||||
Net income | $ | 0.64 | $ | 0.59 | $ | 0.4 | $ | 1.06 | $ | 2.7 | |||||||||||
Diluted: | |||||||||||||||||||||
Net income from continuing operations, net of tax | $ | 0.64 | $ | 0.73 | $ | 0.67 | $ | 0.74 | $ | 2.78 | |||||||||||
Net income (loss) from discontinued operations, net of tax | $ | (0.01 | ) | $ | (0.15 | ) | $ | (0.28 | ) | $ | 0.3 | $ | (0.14 | ) | |||||||
Net income | $ | 0.63 | $ | 0.58 | $ | 0.39 | $ | 1.04 | $ | 2.64 | |||||||||||
2011 | |||||||||||||||||||||
Net sales | $ | 113,060 | $ | 116,670 | $ | 117,306 | $ | 123,085 | $ | 470,121 | |||||||||||
Cost of sales | 22,340 | 23,186 | 23,854 | 23,239 | 92,619 | ||||||||||||||||
Gross profit | 90,720 | 93,484 | 93,452 | 99,846 | 377,502 | ||||||||||||||||
Operating expense | 118,217 | 74,088 | 69,853 | 84,035 | 346,193 | ||||||||||||||||
Operating income (loss) | (27,497 | ) | 19,396 | 23,599 | 15,811 | 31,309 | |||||||||||||||
Net income (loss) from continuing operations, net of tax | (36,740 | ) | 10,519 | 12,951 | 11,530 | (1,740 | ) | ||||||||||||||
Net income (loss) from discontinued operations, net of tax | 939 | (561 | ) | (573 | ) | 862 | 667 | ||||||||||||||
Net income (loss) | $ | (35,801 | ) (1) | $ | 9,958 | $ | 12,378 | $ | 12,392 | (2) | $ | (1,073 | ) | ||||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (2.05 | ) | $ | 0.58 | $ | 0.7 | $ | 0.62 | $ | (0.10 | ) | |||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.05 | $ | (0.03 | ) | $ | (0.03 | ) | $ | 0.05 | $ | 0.04 | |||||||||
Net income (loss) | $ | (2.00 | ) | $ | 0.55 | $ | 0.67 | $ | 0.67 | $ | (0.06 | ) | |||||||||
Diluted: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (2.05 | ) | $ | 0.57 | $ | 0.69 | $ | 0.62 | $ | (0.10 | ) | |||||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.05 | $ | (0.03 | ) | $ | (0.03 | ) | $ | 0.04 | $ | 0.04 | |||||||||
Net income (loss) | $ | (2.00 | ) | $ | 0.54 | $ | 0.66 | $ | 0.66 | $ | (0.06 | ) | |||||||||
-1 | Includes $46 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
-2 | Includes $10.5 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
Condensed Consolidated Statement of Operations | |||||||||||||||||||||
Restatement Adjustments | |||||||||||||||||||||
(U.S. Dollars, in thousands, except per share data) | |||||||||||||||||||||
1st | 2nd | 3rd | 4th | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
2012 | |||||||||||||||||||||
Net sales | $ | (7,105 | ) | $ | (6,069 | ) | $ | (6,895 | ) | $ | 5,330 | $ | (14,739 | ) | |||||||
Cost of sales | (561 | ) | 3,871 | 2,011 | 6,440 | 11,761 | |||||||||||||||
Gross profit | (6,544 | ) | (9,940 | ) | (8,906 | ) | (1,110 | ) | (26,500 | ) | |||||||||||
Operating expense | (2,033 | ) | (3,673 | ) | (6,178 | ) | (2,242 | ) | (14,126 | ) | |||||||||||
Operating income | (4,511 | ) | (6,267 | ) | (2,728 | ) | 1,132 | (12,374 | ) | ||||||||||||
Net income (loss) from continuing operations, net of tax | (3,618 | ) | (4,097 | ) | (2,544 | ) | 1,373 | (8,886 | ) | ||||||||||||
Net income (loss) from discontinued operations, net of tax | 1,009 | 146 | — | (726 | ) | 429 | |||||||||||||||
Net income (loss) | $ | (2,609 | ) | $ | (3,951 | ) | $ | (2,544 | ) | $ | 647 | $ | (8,457 | ) | |||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (0.19 | ) | $ | (0.22 | ) | $ | (0.14 | ) | $ | 0.07 | $ | (0.47 | ) | |||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.05 | $ | 0.01 | $ | — | $ | (0.03 | ) | $ | 0.02 | ||||||||||
Net income (loss) | $ | (0.14 | ) | $ | (0.21 | ) | $ | (0.14 | ) | $ | 0.04 | $ | (0.45 | ) | |||||||
Diluted: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (0.19 | ) | $ | (0.22 | ) | $ | (0.13 | ) | $ | 0.07 | $ | (0.46 | ) | |||||||
Net income (loss) from discontinued operations, net of tax | $ | 0.05 | $ | 0.01 | $ | (0.01 | ) | $ | (0.04 | ) | $ | 0.03 | |||||||||
Net income (loss) | $ | (0.14 | ) | $ | (0.21 | ) | $ | (0.14 | ) | $ | (0.03 | ) | $ | (0.43 | ) | ||||||
2011 | |||||||||||||||||||||
Net sales | $ | (9,454 | ) | $ | (8,454 | ) | $ | (5,796 | ) | $ | (4,446 | ) | $ | (28,150 | ) | ||||||
Cost of sales | 6 | (431 | ) | (728 | ) | 4,061 | 2,908 | ||||||||||||||
Gross profit | (9,460 | ) | (8,023 | ) | (5,068 | ) | (8,507 | ) | (31,058 | ) | |||||||||||
Operating expense | (1,357 | ) | (986 | ) | (2,436 | ) | (870 | ) | (5,649 | ) | |||||||||||
Operating income | (8,103 | ) | (7,037 | ) | (2,632 | ) | (7,637 | ) | (25,409 | ) | |||||||||||
Net income (loss) from continuing operations, net of tax | (5,009 | ) | (3,940 | ) | (1,651 | ) | (3,878 | ) | (14,478 | ) | |||||||||||
Net income (loss) from discontinued operations, net of tax | (657 | ) | (623 | ) | (652 | ) | (627 | ) | (2,559 | ) | |||||||||||
Net income (loss) | $ | (5,666 | ) | $ | (4,563 | ) | $ | (2,303 | ) | $ | (4,505 | ) | $ | (17,037 | ) | ||||||
Net income (loss) per common share: | |||||||||||||||||||||
Basic: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (0.28 | ) | $ | (0.22 | ) | $ | (0.09 | ) | $ | (0.20 | ) | $ | (0.79 | ) | ||||||
Net income (loss) from discontinued operations, net of tax | $ | (0.03 | ) | $ | (0.04 | ) | $ | (0.04 | ) | $ | (0.04 | ) | $ | (0.14 | ) | ||||||
Net income (loss) | $ | (0.31 | ) | $ | (0.26 | ) | $ | (0.13 | ) | $ | (0.24 | ) | $ | (0.93 | ) | ||||||
Diluted: | |||||||||||||||||||||
Net income (loss) from continuing operations, net of tax | $ | (0.28 | ) | $ | (0.22 | ) | $ | (0.09 | ) | $ | (0.21 | ) | $ | (0.79 | ) | ||||||
Net income (loss) from discontinued operations, net of tax | $ | (0.03 | ) | $ | (0.03 | ) | $ | (0.03 | ) | $ | (0.03 | ) | $ | (0.14 | ) | ||||||
Net income (loss) | $ | (0.31 | ) | $ | (0.25 | ) | $ | (0.12 | ) | $ | (0.24 | ) | $ | (0.93 | ) | ||||||
-1 | Includes $46 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
-2 | Includes $10.5 million of charges related to U.S. Government resolutions | ||||||||||||||||||||
Condensed Consolidated Balance Sheets | ' | ||||||||||||||||||||
Condensed Consolidated Balance Sheets | |||||||||||||||||||||
As Restated | |||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | 1st | 2nd | 3rd | 4th | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
(Restated) | (Restated) | (Restated) | (Restated) | ||||||||||||||||||
2012 | |||||||||||||||||||||
Total assets | $ | 694,106 | $ | 530,395 | $ | 539,566 | $ | 472,897 | |||||||||||||
Total liabilities | 381,734 | 205,196 | 193,599 | 105,065 | |||||||||||||||||
Total shareholders’ equity | 312,372 | 325,199 | 345,967 | 367,832 | |||||||||||||||||
Total liabilities and shareholders’ equity | $ | 694,106 | $ | 530,395 | $ | 539,566 | $ | 472,897 | |||||||||||||
2011 | |||||||||||||||||||||
Total assets | $ | 618,938 | $ | 632,860 | $ | 639,868 | $ | 685,380 | |||||||||||||
Total liabilities | 354,949 | 352,884 | 347,777 | 393,306 | |||||||||||||||||
Total shareholders’ equity | 263,989 | 279,976 | 292,091 | 292,074 | |||||||||||||||||
Total liabilities and shareholders’ equity | $ | 618,938 | $ | 632,860 | $ | 639,868 | $ | 685,380 | |||||||||||||
Condensed Consolidated Balance Sheets | |||||||||||||||||||||
As Previously Reported | |||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | 1st | 2nd | 3rd | 4th | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
2012 | |||||||||||||||||||||
Total assets | $ | 707,586 | $ | 553,320 | $ | 565,073 | $ | 504,281 | |||||||||||||
Total liabilities | 369,178 | 199,104 | 187,463 | 105,183 | |||||||||||||||||
Total shareholders’ equity | 338,408 | 354,216 | 377,610 | 399,098 | |||||||||||||||||
Total liabilities and shareholders’ equity | $ | 707,586 | $ | 553,320 | $ | 565,073 | $ | 504,281 | |||||||||||||
2011 | |||||||||||||||||||||
Total assets | $ | 631,284 | $ | 647,026 | $ | 656,073 | $ | 704,472 | |||||||||||||
Total liabilities | 354,201 | 349,116 | 345,130 | 389,301 | |||||||||||||||||
Total shareholders’ equity | 277,083 | 297,910 | 310,943 | 315,171 | |||||||||||||||||
Total liabilities and shareholders’ equity | $ | 631,284 | $ | 647,026 | $ | 656,073 | $ | 704,472 | |||||||||||||
Condensed Consolidated Balance Sheets | |||||||||||||||||||||
Restatement Adjustments | |||||||||||||||||||||
(U.S. Dollars, in thousands, except share and per share data) | 1st | 2nd | 3rd | 4th | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
2012 | |||||||||||||||||||||
Total assets | $ | (13,480 | ) | $ | (22,925 | ) | $ | (25,507 | ) | $ | (31,384 | ) | |||||||||
Total liabilities | 12,556 | 6,092 | 6,136 | (118 | ) | ||||||||||||||||
Total shareholders’ equity | (26,036 | ) | (29,017 | ) | (31,643 | ) | (31,266 | ) | |||||||||||||
Total liabilities and shareholders’ equity | $ | (13,480 | ) | $ | (22,925 | ) | $ | (25,507 | ) | $ | (31,384 | ) | |||||||||
2011 | |||||||||||||||||||||
Total assets | $ | (12,346 | ) | $ | (14,166 | ) | $ | (16,205 | ) | $ | (19,092 | ) | |||||||||
Total liabilities | 748 | 3,768 | 2,647 | 4,005 | |||||||||||||||||
Total shareholders’ equity | (13,094 | ) | (17,934 | ) | (18,852 | ) | (23,097 | ) | |||||||||||||
Total liabilities and shareholders’ equity | $ | (12,346 | ) | $ | (14,166 | ) | $ | (16,205 | ) | $ | (19,092 | ) | |||||||||
Summary_of_significant_account3
Summary of significant accounting policies - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | ||||||||||||||||
Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Jan. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2012 | |
Unit | Musculoskeletal Transplant Foundation ("MTF") [Member] | Customers and distributors based in Europe [Member] | Interest Expense [Member] | Collaborative Arrangement [Member] | Collaborative Arrangement [Member] | Collaborative Arrangement [Member] | Collaborative Arrangement [Member] | Collaborative Arrangement [Member] | Developed Technology [Member] | |||||||||||
Musculoskeletal Transplant Foundation ("MTF") [Member] | Musculoskeletal Transplant Foundation ("MTF") [Member] | Musculoskeletal Transplant Foundation ("MTF") [Member] | Musculoskeletal Transplant Foundation ("MTF") [Member] | Musculoskeletal Transplant Foundation ("MTF") [Member] | ||||||||||||||||
Years | Years | |||||||||||||||||||
Foreign Currency Translation [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Transactional foreign currency gains and (losses), including those generated from intercompany operations | ' | ' | ' | ' | ' | ' | ' | ' | $500,000 | $1,600,000 | $100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average amortization period ( in years) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '11 years |
Number of reporting units | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period of agreement with MTF (in years) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 | ' |
Extended Period of existing agreement with MTF (in years) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15 | ' | ' | ' | ' | ' |
Marketing fee | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 46,500,000 | 36,800,000 | 29,700,000 | ' | ' |
Interest Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 600,000 | ' | ' | ' | ' | ' | ' |
Advertising expense | ' | ' | ' | ' | ' | ' | ' | ' | 300,000 | 500,000 | 600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expenditures for research and development | ' | ' | ' | ' | ' | ' | ' | ' | 28,577,000 | 22,861,000 | 27,958,000 | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | $117,365,000 | $107,857,000 | $113,423,000 | $108,936,000 | $118,639,000 | $111,510,000 | $108,216,000 | $103,606,000 | $447,581,000 | $441,971,000 | $462,571,000 | ' | $55,000,000 | ' | ' | ' | ' | ' | ' | ' |
Summary_of_significant_account4
Summary of significant accounting policies - Schedule of Useful Lives (Detail) | 12 Months Ended |
Dec. 31, 2012 | |
Buildings [Member] | Minimum [Member] | ' |
Foreign Currency Translation [Line Items] | ' |
Useful life, in years | '25 years |
Buildings [Member] | Maximum [Member] | ' |
Foreign Currency Translation [Line Items] | ' |
Useful life, in years | '33 years |
Plant, equipment and instrumentation [Member] | Minimum [Member] | ' |
Foreign Currency Translation [Line Items] | ' |
Useful life, in years | '2 years |
Plant, equipment and instrumentation [Member] | Maximum [Member] | ' |
Foreign Currency Translation [Line Items] | ' |
Useful life, in years | '10 years |
Furniture and fixtures [Member] | Minimum [Member] | ' |
Foreign Currency Translation [Line Items] | ' |
Useful life, in years | '4 years |
Furniture and fixtures [Member] | Maximum [Member] | ' |
Foreign Currency Translation [Line Items] | ' |
Useful life, in years | '8 years |
Summary_of_significant_account5
Summary of significant accounting policies - Components of Changes in Accumulated Other Comprehensive Income (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Beginning Balance | $3,714 | ' | ' |
Unrealized gain (loss) on cross-currency swaps, net of tax | 263 | -437 | -90 |
Foreign currency translation adjustment | 768 | -2,279 | -1,317 |
Ending Balance | 4,745 | 3,714 | ' |
Foreign Currency Translation Adjustments [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Beginning Balance | 3,846 | 6,125 | ' |
Foreign currency translation adjustment | 768 | -2,279 | ' |
Ending Balance | 4,614 | 3,846 | ' |
Fair Value of Cross- Currency Swaps [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Beginning Balance | -132 | 305 | ' |
Unrealized gain (loss) on cross-currency swaps, net of tax | 263 | -437 | ' |
Foreign currency translation adjustment | ' | ' | ' |
Ending Balance | 131 | -132 | ' |
Accumulated Other Comprehensive Income (Loss) [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Beginning Balance | 3,714 | 6,430 | ' |
Unrealized gain (loss) on cross-currency swaps, net of tax | 263 | -437 | -90 |
Foreign currency translation adjustment | 768 | -2,279 | -1,317 |
Ending Balance | $4,745 | $3,714 | $6,430 |
Summary_of_significant_account6
Summary of significant accounting policies - Components of Changes in Accumulated Other Comprehensive Income (Parenthetical) (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Unrealized gain (loss) on cross-currency swaps, tax (benefit) | $153 | $256 | $36 |
Fair Value of Cross- Currency Swaps [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Unrealized gain (loss) on cross-currency swaps, tax (benefit) | 153 | -256 | ' |
Accumulated Other Comprehensive Income (Loss) [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' |
Unrealized gain (loss) on cross-currency swaps, tax (benefit) | $153 | ($256) | ' |
Restatement_of_the_Consolidate2
Restatement of the Consolidated Financial Statements - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 12 Months Ended | ||||||||||||||||||||||||||||
Jan. 02, 2010 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | 31-May-12 | 31-May-12 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | |
Inventory Reserves [Member] | Inventory Reserves [Member] | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Term Loan Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Distributor Revenue [Member] | Distributor Revenue [Member] | Distributor Revenue [Member] | Distributor Revenue [Member] | Distributor Revenue [Member] | Distributor Revenue [Member] | Distributor Revenue [Member] | Other [Member] | |||||||||||||
Distributor | Previously Reported [Member] | Previously Reported [Member] | Previously Reported [Member] | Minimum [Member] | Maximum [Member] | |||||||||||||||||||||||||||||||
Increase (Decrease) in net sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | ($14,700,000) | ($28,200,000) | $1,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in net income from continuing operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | -8,900,000 | -14,500,000 | 3,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in retained earnings | 8,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in total stockholders' equity | 7,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | 117,365,000 | 107,857,000 | 113,423,000 | 108,936,000 | 118,639,000 | 111,510,000 | 108,216,000 | 103,606,000 | 447,581,000 | 441,971,000 | 462,571,000 | ' | ' | 112,035,000 | 114,752,000 | 119,492,000 | 116,041,000 | 123,085,000 | 117,306,000 | 116,670,000 | 113,060,000 | 462,320,000 | 470,121,000 | 460,629,000 | ' | ' | ' | ' | ' | 462,320,000 | 470,121,000 | 460,629,000 | ' | ' | ' |
Percentage of net sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 11.00% | 13.00% | ' |
Number of distributer terminated | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' |
Sales return | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,300,000 | 4,100,000 | ' | ' | ' | ' | ' | ' |
Distributors that did not meet the fixed or determinable or collectability revenue recognition criteria | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in accounts receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,438,000 | -293,000 | 16,645,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -41,300,000 | -33,800,000 | ' | ' | ' | ' | ' | ' |
Increase (Decease) in inventory | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,495,000 | 12,624,000 | -9,767,000 | -14,800,000 | -8,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 11,000,000 | 8,800,000 | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in inventory reserve | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repayment of debt obligation | ' | ' | ' | ' | ' | ' | ' | ' | ' | 188,695,000 | 7,500,000 | 36,269,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 87,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repayment of debt obligation | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 57,500,000 | 20,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Adjustment to reclassify interest expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,900,000 | 4,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in cash flow related to operating activities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000 |
Decrease in cash flow related to financing activities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ($1,000,000) |
Restatement_of_the_Consolidate3
Restatement of the Consolidated Financial Statements - Adjustments to Previously Filed Consolidated Income Statements (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Net Sales | $117,365 | $107,857 | $113,423 | $108,936 | $118,639 | $111,510 | $108,216 | $103,606 | $447,581 | $441,971 | $462,571 |
Cost of sales | 24,944 | 24,384 | 27,547 | 21,378 | 27,300 | 23,126 | 22,755 | 22,346 | 98,253 | 95,527 | 97,093 |
Gross profit | 92,421 | 83,473 | 85,876 | 87,558 | 91,339 | 88,384 | 85,461 | 81,260 | 349,328 | 346,444 | 365,478 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | 187,131 | 193,511 | 196,113 |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | 53,391 | 64,481 | 73,010 |
Research and development | ' | ' | ' | ' | ' | ' | ' | ' | 28,577 | 22,861 | 27,958 |
Amortization of intangibles assets | ' | ' | ' | ' | ' | ' | ' | ' | 2,298 | 2,550 | 2,413 |
Charges related to U.S. Government resolutions | ' | ' | ' | ' | ' | ' | ' | ' | 1,295 | 57,141 | ' |
Total operation expenses | 66,808 | 64,668 | 71,578 | 69,638 | 83,165 | 67,417 | 73,102 | 116,860 | 272,692 | 340,544 | 299,494 |
Operating income | 25,613 | 18,805 | 14,298 | 17,920 | 8,174 | 20,967 | 12,359 | -35,600 | 76,636 | 5,900 | 65,984 |
Other income and (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -6,448 | -7,953 | -10,956 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 70,188 | -2,053 | 55,028 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | -25,138 | -14,165 | -24,031 |
Net income from continuing operations, net of tax | 16,009 | 10,574 | 9,870 | 8,597 | 7,652 | 11,300 | 6,579 | -41,749 | 45,050 | -16,218 | 30,997 |
Previously Reported [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | 112,035 | 114,752 | 119,492 | 116,041 | 123,085 | 117,306 | 116,670 | 113,060 | 462,320 | 470,121 | 460,629 |
Cost of sales | 18,504 | 22,373 | 23,676 | 21,939 | 23,239 | 23,854 | 23,186 | 22,340 | 86,492 | 92,619 | 90,461 |
Gross profit | 93,531 | 92,379 | 95,816 | 94,102 | 99,846 | 93,452 | 93,484 | 90,720 | 375,828 | 377,502 | 370,168 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | 200,343 | 200,145 | 200,835 |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | 53,827 | 64,374 | 72,912 |
Research and development | ' | ' | ' | ' | ' | ' | ' | ' | 28,577 | 22,861 | 27,958 |
Amortization of intangibles assets | ' | ' | ' | ' | ' | ' | ' | ' | 2,098 | 2,350 | 2,213 |
Charges related to U.S. Government resolutions | ' | ' | ' | ' | ' | ' | ' | ' | 1,973 | 56,463 | ' |
Total operation expenses | 69,050 | 70,846 | 75,251 | 71,671 | 84,035 | 69,853 | 74,088 | 118,217 | 286,818 | 346,193 | 303,918 |
Operating income | 24,481 | 21,533 | 20,565 | 22,431 | 15,811 | 23,599 | 19,396 | -27,497 | 89,010 | 31,309 | 66,250 |
Other income and (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -6,282 | -11,868 | -15,886 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 82,728 | 19,441 | 50,364 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | -28,792 | -21,181 | -22,606 |
Net income from continuing operations, net of tax | 14,636 | 13,118 | 13,967 | 12,215 | 11,530 | 12,951 | 10,519 | -36,740 | 53,936 | -1,740 | 27,758 |
Total Adjustments [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | -14,739 | -28,150 | 1,942 |
Cost of sales | ' | ' | ' | ' | ' | ' | ' | ' | 11,761 | 2,908 | 6,632 |
Gross profit | ' | ' | ' | ' | ' | ' | ' | ' | -26,500 | -31,058 | -4,690 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | -13,212 | -6,634 | -4,722 |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | -436 | 107 | 98 |
Amortization of intangibles assets | ' | ' | ' | ' | ' | ' | ' | ' | 200 | 200 | 200 |
Charges related to U.S. Government resolutions | ' | ' | ' | ' | ' | ' | ' | ' | -678 | 678 | ' |
Total operation expenses | ' | ' | ' | ' | ' | ' | ' | ' | -14,126 | -5,649 | -4,424 |
Operating income | ' | ' | ' | ' | ' | ' | ' | ' | -12,374 | -25,409 | -266 |
Other income and (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -166 | 3,915 | 4,930 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -12,540 | -21,494 | 4,664 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 3,654 | 7,016 | -1,425 |
Net income from continuing operations, net of tax | ' | ' | ' | ' | ' | ' | ' | ' | -8,886 | -14,478 | 3,239 |
Distributor Revenue [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | -14,777 | -29,135 | 2,088 |
Cost of sales | ' | ' | ' | ' | ' | ' | ' | ' | -2,032 | -8,289 | -323 |
Gross profit | ' | ' | ' | ' | ' | ' | ' | ' | -12,745 | -20,846 | 2,411 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | -6,629 | -1,216 | -275 |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | -2 | ' | ' |
Total operation expenses | ' | ' | ' | ' | ' | ' | ' | ' | -6,631 | -1,216 | -275 |
Operating income | ' | ' | ' | ' | ' | ' | ' | ' | -6,114 | -19,630 | 2,686 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -6,114 | -19,630 | 2,686 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 1,782 | 6,408 | -821 |
Net income from continuing operations, net of tax | ' | ' | ' | ' | ' | ' | ' | ' | -4,332 | -13,222 | 1,865 |
Inventory Reserves [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of sales | ' | ' | ' | ' | ' | ' | ' | ' | 5,647 | 3,377 | 2,281 |
Gross profit | ' | ' | ' | ' | ' | ' | ' | ' | -5,647 | -3,377 | -2,281 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating income | ' | ' | ' | ' | ' | ' | ' | ' | -5,647 | -3,377 | -2,281 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -5,647 | -3,377 | -2,281 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 1,645 | 1,102 | 697 |
Net income from continuing operations, net of tax | ' | ' | ' | ' | ' | ' | ' | ' | -4,002 | -2,275 | -1,584 |
Royalties [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of sales | ' | ' | ' | ' | ' | ' | ' | ' | 8,190 | 7,713 | 5,386 |
Gross profit | ' | ' | ' | ' | ' | ' | ' | ' | -8,190 | -7,713 | -5,386 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | -8,190 | -7,713 | -5,386 |
Total operation expenses | ' | ' | ' | ' | ' | ' | ' | ' | -8,190 | -7,713 | -5,386 |
Other [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 38 | 985 | -146 |
Cost of sales | ' | ' | ' | ' | ' | ' | ' | ' | -44 | 107 | -712 |
Gross profit | ' | ' | ' | ' | ' | ' | ' | ' | 82 | 878 | 566 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | 1,607 | 2,295 | 939 |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | -434 | 107 | 98 |
Amortization of intangibles assets | ' | ' | ' | ' | ' | ' | ' | ' | 200 | 200 | 200 |
Charges related to U.S. Government resolutions | ' | ' | ' | ' | ' | ' | ' | ' | -678 | 678 | ' |
Total operation expenses | ' | ' | ' | ' | ' | ' | ' | ' | 695 | 3,280 | 1,237 |
Operating income | ' | ' | ' | ' | ' | ' | ' | ' | -613 | -2,402 | -671 |
Other income and (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -166 | 3,915 | 4,930 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -779 | 1,513 | 4,259 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 227 | -494 | -1,301 |
Net income from continuing operations, net of tax | ' | ' | ' | ' | ' | ' | ' | ' | ($552) | $1,019 | $2,958 |
Restatement_of_the_Consolidate4
Restatement of the Consolidated Financial Statements - Effects of Restatements on Consolidated Balance Sheet (Detail) (USD $) | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 |
In Thousands, unless otherwise specified | ||||||||||
Current assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | $31,055 | ' | ' | ' | $33,207 | ' | ' | ' | $13,561 | $13,328 |
Restricted cash | 21,314 | ' | ' | ' | 45,476 | ' | ' | ' | ' | ' |
Trade accounts receivable, less allowances of $13,543 and $9,341 at December 31, 2012 and 2011, respectively | 107,312 | ' | ' | ' | 99,888 | ' | ' | ' | ' | ' |
Inventories | 83,373 | ' | ' | ' | 81,528 | ' | ' | ' | ' | ' |
Deferred income taxes | 33,450 | ' | ' | ' | 36,313 | ' | ' | ' | ' | ' |
Escrow receivable | ' | ' | ' | ' | 41,537 | ' | ' | ' | ' | ' |
Prepaid expenses and other current assets | 34,079 | ' | ' | ' | 21,999 | ' | ' | ' | ' | ' |
Assets held for sale | ' | ' | ' | ' | 171,185 | ' | ' | ' | ' | ' |
Total current assets | 310,583 | ' | ' | ' | 531,133 | ' | ' | ' | ' | ' |
Property, plant and equipment, net | 53,835 | ' | ' | ' | 46,137 | ' | ' | ' | ' | ' |
Patents and other intangible assets, net | 7,290 | ' | ' | ' | 8,846 | ' | ' | ' | ' | ' |
Goodwill | 74,388 | ' | ' | ' | 73,094 | ' | ' | ' | 73,598 | ' |
Deferred income taxes | 18,881 | ' | ' | ' | 16,741 | ' | ' | ' | ' | ' |
Other long-term assets | 7,920 | ' | ' | ' | 9,429 | ' | ' | ' | ' | ' |
Total assets | 472,897 | 539,566 | 530,395 | 694,106 | 685,380 | 639,868 | 632,860 | 618,938 | ' | ' |
Current liabilities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Bank borrowings | 16 | ' | ' | ' | 1,318 | ' | ' | ' | ' | ' |
Current portion of long-term debt | ' | ' | ' | ' | 17,500 | ' | ' | ' | ' | ' |
Trade accounts payable | 22,575 | ' | ' | ' | 18,231 | ' | ' | ' | ' | ' |
Accrued charges related to U.S. Government resolutions | ' | ' | ' | ' | 83,138 | ' | ' | ' | ' | ' |
Other current liabilities | 39,594 | ' | ' | ' | 40,836 | ' | ' | ' | ' | ' |
Liabilities held for sale | ' | ' | ' | ' | 22,676 | ' | ' | ' | ' | ' |
Total current liabilities | 62,185 | ' | ' | ' | 183,699 | ' | ' | ' | ' | ' |
Long-term debt | 20,000 | ' | ' | ' | 191,195 | ' | ' | ' | ' | ' |
Deferred income taxes | 11,456 | ' | ' | ' | 9,778 | ' | ' | ' | ' | ' |
Other long-term liabilities | 11,424 | ' | ' | ' | 8,634 | ' | ' | ' | ' | ' |
Total liabilities | 105,065 | 193,599 | 205,196 | 381,734 | 393,306 | 347,777 | 352,884 | 354,949 | ' | ' |
Contingencies (Note 17) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shareholders' equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common shares $0.10 par value; 50,000,000 shares authorized; 19,339,329 issued and outstanding as of December 31, 2012 and $0.10 par value; 50,000,000 shares authorized; 18,465,444 issued and outstanding as of December 31, 2011 | 1,934 | ' | ' | ' | 1,846 | ' | ' | ' | ' | ' |
Additional paid-in capital | 246,306 | ' | ' | ' | 214,505 | ' | ' | ' | ' | ' |
Retained earnings | 114,847 | ' | ' | ' | 72,009 | ' | ' | ' | ' | ' |
Accumulated other comprehensive income | 4,745 | ' | ' | ' | 3,714 | ' | ' | ' | ' | ' |
Total shareholders' equity | 367,832 | 345,967 | 325,199 | 312,372 | 292,074 | 292,091 | 279,976 | 263,989 | ' | ' |
Total liabilities and shareholders' equity | 472,897 | 539,566 | 530,395 | 694,106 | 685,380 | 639,868 | 632,860 | 618,938 | ' | ' |
Previously Reported [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | 31,055 | ' | ' | ' | 33,207 | ' | ' | ' | ' | ' |
Restricted cash | 21,314 | ' | ' | ' | 45,476 | ' | ' | ' | ' | ' |
Trade accounts receivable, less allowances of $13,543 and $9,341 at December 31, 2012 and 2011, respectively | 150,316 | ' | ' | ' | 132,828 | ' | ' | ' | ' | ' |
Inventories | 88,744 | ' | ' | ' | 82,969 | ' | ' | ' | ' | ' |
Deferred income taxes | 16,959 | ' | ' | ' | 16,349 | ' | ' | ' | ' | ' |
Escrow receivable | ' | ' | ' | ' | 41,537 | ' | ' | ' | ' | ' |
Prepaid expenses and other current assets | 32,056 | ' | ' | ' | 26,069 | ' | ' | ' | ' | ' |
Assets held for sale | ' | ' | ' | ' | 171,185 | ' | ' | ' | ' | ' |
Total current assets | 340,444 | ' | ' | ' | 549,620 | ' | ' | ' | ' | ' |
Property, plant and equipment, net | 51,362 | ' | ' | ' | 43,368 | ' | ' | ' | ' | ' |
Patents and other intangible assets, net | 6,880 | ' | ' | ' | 8,236 | ' | ' | ' | ' | ' |
Goodwill | 74,388 | ' | ' | ' | 73,094 | ' | ' | ' | ' | ' |
Deferred income taxes | 19,904 | ' | ' | ' | 18,584 | ' | ' | ' | ' | ' |
Other long-term assets | 11,303 | ' | ' | ' | 11,570 | ' | ' | ' | ' | ' |
Total assets | 504,281 | 565,073 | 553,320 | 707,586 | 704,472 | 656,073 | 647,026 | 631,284 | ' | ' |
Current liabilities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Bank borrowings | 16 | ' | ' | ' | 1,318 | ' | ' | ' | ' | ' |
Current portion of long-term debt | ' | ' | ' | ' | 17,500 | ' | ' | ' | ' | ' |
Trade accounts payable | 21,812 | ' | ' | ' | 16,488 | ' | ' | ' | ' | ' |
Accrued charges related to U.S. Government resolutions | ' | ' | ' | ' | 82,500 | ' | ' | ' | ' | ' |
Other current liabilities | 46,969 | ' | ' | ' | 45,327 | ' | ' | ' | ' | ' |
Liabilities held for sale | ' | ' | ' | ' | 22,676 | ' | ' | ' | ' | ' |
Total current liabilities | 68,797 | ' | ' | ' | 185,809 | ' | ' | ' | ' | ' |
Long-term debt | 20,000 | ' | ' | ' | 191,195 | ' | ' | ' | ' | ' |
Deferred income taxes | 11,456 | ' | ' | ' | 9,778 | ' | ' | ' | ' | ' |
Other long-term liabilities | 4,930 | ' | ' | ' | 2,519 | ' | ' | ' | ' | ' |
Total liabilities | 105,183 | 187,463 | 199,104 | 369,178 | 389,301 | 345,130 | 349,116 | 354,201 | ' | ' |
Contingencies (Note 17) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shareholders' equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common shares $0.10 par value; 50,000,000 shares authorized; 19,339,329 issued and outstanding as of December 31, 2012 and $0.10 par value; 50,000,000 shares authorized; 18,465,444 issued and outstanding as of December 31, 2011 | 1,934 | ' | ' | ' | 1,846 | ' | ' | ' | ' | ' |
Additional paid-in capital | 246,111 | ' | ' | ' | 214,310 | ' | ' | ' | ' | ' |
Retained earnings | 148,549 | ' | ' | ' | 97,254 | ' | ' | ' | ' | ' |
Accumulated other comprehensive income | 2,504 | ' | ' | ' | 1,761 | ' | ' | ' | ' | ' |
Total shareholders' equity | 399,098 | 377,610 | 354,216 | 338,408 | 315,171 | 310,943 | 297,910 | 277,083 | ' | ' |
Total liabilities and shareholders' equity | 504,281 | 565,073 | 553,320 | 707,586 | 704,472 | 656,073 | 647,026 | 631,284 | ' | ' |
Adjustments [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trade accounts receivable, less allowances of $13,543 and $9,341 at December 31, 2012 and 2011, respectively | -43,004 | ' | ' | ' | -32,940 | ' | ' | ' | ' | ' |
Inventories | -5,371 | ' | ' | ' | -1,441 | ' | ' | ' | ' | ' |
Deferred income taxes | 16,491 | ' | ' | ' | 19,964 | ' | ' | ' | ' | ' |
Prepaid expenses and other current assets | 2,023 | ' | ' | ' | -4,070 | ' | ' | ' | ' | ' |
Total current assets | -29,861 | ' | ' | ' | -18,487 | ' | ' | ' | ' | ' |
Property, plant and equipment, net | 2,473 | ' | ' | ' | 2,769 | ' | ' | ' | ' | ' |
Patents and other intangible assets, net | 410 | ' | ' | ' | 610 | ' | ' | ' | ' | ' |
Deferred income taxes | -1,023 | ' | ' | ' | -1,843 | ' | ' | ' | ' | ' |
Other long-term assets | -3,383 | ' | ' | ' | -2,141 | ' | ' | ' | ' | ' |
Total assets | -31,384 | -25,507 | -22,925 | -13,480 | -19,092 | -16,205 | -14,166 | -12,346 | ' | ' |
Current liabilities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trade accounts payable | 763 | ' | ' | ' | 1,743 | ' | ' | ' | ' | ' |
Accrued charges related to U.S. Government resolutions | ' | ' | ' | ' | 638 | ' | ' | ' | ' | ' |
Other current liabilities | -7,375 | ' | ' | ' | -4,491 | ' | ' | ' | ' | ' |
Total current liabilities | -6,612 | ' | ' | ' | -2,110 | ' | ' | ' | ' | ' |
Other long-term liabilities | 6,494 | ' | ' | ' | 6,115 | ' | ' | ' | ' | ' |
Total liabilities | -118 | 6,136 | 6,092 | 12,556 | 4,005 | 2,647 | 3,768 | 748 | ' | ' |
Contingencies (Note 17) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shareholders' equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional paid-in capital | 195 | ' | ' | ' | 195 | ' | ' | ' | ' | ' |
Retained earnings | -33,702 | ' | ' | ' | -25,245 | ' | ' | ' | ' | ' |
Accumulated other comprehensive income | 2,241 | ' | ' | ' | 1,953 | ' | ' | ' | ' | ' |
Total shareholders' equity | -31,266 | -31,643 | -29,017 | -26,036 | -23,097 | -18,852 | -17,934 | -13,094 | ' | ' |
Total liabilities and shareholders' equity | ($31,384) | ($25,507) | ($22,925) | ($13,480) | ($19,092) | ($16,205) | ($14,166) | ($12,346) | ' | ' |
Restatement_of_the_Consolidate5
Restatement of the Consolidated Financial Statements - Effects of Restatements on Consolidated Balance Sheet (Parenthetical) (Detail) (USD $) | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, except Share data, unless otherwise specified | ||
Trade accounts receivable, allowances | $13,543 | $9,341 |
Common shares, par value | $0.10 | $0.10 |
Common shares, authorized | 50,000,000 | 50,000,000 |
Common shares, issued | 19,339,329 | 18,465,444 |
Common shares, outstanding | 19,339,329 | 18,465,444 |
Previously Reported [Member] | ' | ' |
Trade accounts receivable, allowances | 13,543 | 9,341 |
Common shares, par value | $0.10 | $0.10 |
Common shares, authorized | 50,000,000 | 50,000,000 |
Common shares, issued | 19,339,329 | 18,465,444 |
Common shares, outstanding | 19,339,329 | 18,465,444 |
Adjustments [Member] | ' | ' |
Trade accounts receivable, allowances | $13,543 | $9,341 |
Restatement_of_the_Consolidate6
Restatement of the Consolidated Financial Statements - Effects of Restatements of Consolidated Statement of Operations and Comprehensive Income (Loss) (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Product sales | ' | ' | ' | ' | ' | ' | ' | ' | $401,039 | $405,147 | $432,845 |
Marketing service fees | ' | ' | ' | ' | ' | ' | ' | ' | 46,542 | 36,824 | 29,726 |
Net Sales | 117,365 | 107,857 | 113,423 | 108,936 | 118,639 | 111,510 | 108,216 | 103,606 | 447,581 | 441,971 | 462,571 |
Cost of sales | 24,944 | 24,384 | 27,547 | 21,378 | 27,300 | 23,126 | 22,755 | 22,346 | 98,253 | 95,527 | 97,093 |
Gross profit | 92,421 | 83,473 | 85,876 | 87,558 | 91,339 | 88,384 | 85,461 | 81,260 | 349,328 | 346,444 | 365,478 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | 187,131 | 193,511 | 196,113 |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | 53,391 | 64,481 | 73,010 |
Research and development | ' | ' | ' | ' | ' | ' | ' | ' | 28,577 | 22,861 | 27,958 |
Amortization of intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | 2,298 | 2,550 | 2,413 |
Charges related to U.S. Government resolutions (Note 17) | ' | ' | ' | ' | ' | ' | ' | ' | 1,295 | 57,141 | ' |
Total operating expenses | 66,808 | 64,668 | 71,578 | 69,638 | 83,165 | 67,417 | 73,102 | 116,860 | 272,692 | 340,544 | 299,494 |
Operating income | 25,613 | 18,805 | 14,298 | 17,920 | 8,174 | 20,967 | 12,359 | -35,600 | 76,636 | 5,900 | 65,984 |
Other income and (expense) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net | ' | ' | ' | ' | ' | ' | ' | ' | -4,743 | -5,541 | -11,287 |
Other expense | ' | ' | ' | ' | ' | ' | ' | ' | -1,705 | -2,412 | 331 |
Total other income (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -6,448 | -7,953 | -10,956 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 70,188 | -2,053 | 55,028 |
Income tax (expense) benefit | ' | ' | ' | ' | ' | ' | ' | ' | -25,138 | -14,165 | -24,031 |
Net income (loss) from continuing operations, net of tax | 16,009 | 10,574 | 9,870 | 8,597 | 7,652 | 11,300 | 6,579 | -41,749 | 45,050 | -16,218 | 30,997 |
Discontinued operations (Note 16) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain on sale of Breg, Inc., net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 1,345 | ' | ' |
Gain on sale of vascular operations, net of tax (Note 22) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,521 |
Income (loss) from discontinued operations | ' | ' | ' | ' | ' | ' | ' | ' | -2,994 | -2,705 | 5,089 |
Income tax benefit (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -563 | 813 | -311 |
Net income (loss) from discontinued operations, net of tax | 5,152 | -5,558 | -2,616 | 810 | 235 | -1,225 | -1,184 | 282 | -2,212 | -1,892 | 13,299 |
Net income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 42,838 | -18,110 | 44,296 |
Net income (loss) per common share-basic: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.83 | $0.55 | $0.52 | $0.46 | $0.42 | $0.61 | $0.36 | ($2.33) | $2.37 | ($0.89) | $1.76 |
Net income (loss) from discontinued operations, net of tax | $0.27 | ($0.29) | ($0.14) | $0.04 | $0.01 | ($0.07) | ($0.07) | $0.02 | ($0.12) | ($0.10) | $0.76 |
Net income (loss) per common share-basic | $1.10 | $0.26 | $0.38 | $0.50 | $0.43 | $0.54 | $0.29 | ($2.31) | $2.25 | ($0.99) | $2.52 |
Net income (loss) per common share-diluted: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.81 | $0.54 | $0.51 | $0.45 | $0.41 | $0.60 | $0.35 | ($2.33) | $2.32 | ($0.89) | $1.73 |
Net income (loss) from discontinued operations, net of tax | $0.26 | ($0.29) | ($0.14) | $0.04 | $0.01 | ($0.06) | ($0.06) | $0.02 | ($0.11) | ($0.10) | $0.74 |
Net income (loss) per common share-diluted: | $1.07 | $0.25 | $0.37 | $0.49 | $0.42 | $0.54 | $0.29 | ($2.31) | $2.21 | ($0.99) | $2.47 |
Weighted average number of common shares: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic | ' | ' | ' | ' | ' | ' | ' | ' | 18,977,263 | 18,219,343 | 17,601,956 |
Diluted | ' | ' | ' | ' | ' | ' | ' | ' | 19,390,413 | 18,219,343 | 17,913,545 |
Other comprehensive income (loss), before tax: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Translation adjustment | ' | ' | ' | ' | ' | ' | ' | ' | 768 | -2,279 | -1,317 |
Unrealized gain (loss) on derivative instrument | ' | ' | ' | ' | ' | ' | ' | ' | 416 | -693 | -126 |
Other comprehensive income (loss), before tax | ' | ' | ' | ' | ' | ' | ' | ' | 1,184 | -2,972 | -1,443 |
Income tax (expense) benefit related to components of other comprehensive income | -153 | ' | ' | ' | 256 | ' | ' | ' | -153 | 256 | 36 |
Other comprehensive income (loss), net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 1,031 | -2,716 | -1,407 |
Comprehensive income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 43,869 | -20,826 | 42,889 |
Previously Reported [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product sales | ' | ' | ' | ' | ' | ' | ' | ' | 415,850 | 432,975 | 430,783 |
Marketing service fees | ' | ' | ' | ' | ' | ' | ' | ' | 46,470 | 37,146 | 29,846 |
Net Sales | 112,035 | 114,752 | 119,492 | 116,041 | 123,085 | 117,306 | 116,670 | 113,060 | 462,320 | 470,121 | 460,629 |
Cost of sales | 18,504 | 22,373 | 23,676 | 21,939 | 23,239 | 23,854 | 23,186 | 22,340 | 86,492 | 92,619 | 90,461 |
Gross profit | 93,531 | 92,379 | 95,816 | 94,102 | 99,846 | 93,452 | 93,484 | 90,720 | 375,828 | 377,502 | 370,168 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | 200,343 | 200,145 | 200,835 |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | 53,827 | 64,374 | 72,912 |
Research and development | ' | ' | ' | ' | ' | ' | ' | ' | 28,577 | 22,861 | 27,958 |
Amortization of intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | 2,098 | 2,350 | 2,213 |
Charges related to U.S. Government resolutions (Note 17) | ' | ' | ' | ' | ' | ' | ' | ' | 1,973 | 56,463 | ' |
Total operating expenses | 69,050 | 70,846 | 75,251 | 71,671 | 84,035 | 69,853 | 74,088 | 118,217 | 286,818 | 346,193 | 303,918 |
Operating income | 24,481 | 21,533 | 20,565 | 22,431 | 15,811 | 23,599 | 19,396 | -27,497 | 89,010 | 31,309 | 66,250 |
Other income and (expense) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net | ' | ' | ' | ' | ' | ' | ' | ' | -4,577 | -9,456 | -16,217 |
Other expense | ' | ' | ' | ' | ' | ' | ' | ' | -1,705 | -2,412 | 331 |
Total other income (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -6,282 | -11,868 | -15,886 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 82,728 | 19,441 | 50,364 |
Income tax (expense) benefit | ' | ' | ' | ' | ' | ' | ' | ' | -28,792 | -21,181 | -22,606 |
Net income (loss) from continuing operations, net of tax | 14,636 | 13,118 | 13,967 | 12,215 | 11,530 | 12,951 | 10,519 | -36,740 | 53,936 | -1,740 | 27,758 |
Discontinued operations (Note 16) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain on sale of Breg, Inc., net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 1,345 | ' | ' |
Gain on sale of vascular operations, net of tax (Note 22) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12,019 |
Income (loss) from discontinued operations | ' | ' | ' | ' | ' | ' | ' | ' | -4,012 | 1,263 | 10,015 |
Income tax benefit (expense) | ' | ' | ' | ' | ' | ' | ' | ' | 26 | -596 | -5,584 |
Net income (loss) from discontinued operations, net of tax | 5,878 | -5,558 | -2,762 | -199 | 862 | -573 | -561 | 939 | -2,641 | 667 | 16,450 |
Net income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 51,295 | -1,073 | 44,208 |
Net income (loss) per common share-basic: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.76 | $0.69 | $0.74 | $0.65 | $0.62 | $0.70 | $0.58 | ($2.05) | $2.84 | ($0.10) | $1.58 |
Net income (loss) from discontinued operations, net of tax | $0.30 | ($0.29) | ($0.15) | ($0.01) | $0.05 | ($0.03) | ($0.03) | $0.05 | ($0.14) | $0.04 | $0.93 |
Net income (loss) per common share-basic | $1.06 | $0.40 | $0.59 | $0.64 | $0.67 | $0.67 | $0.55 | ($2) | $2.70 | ($0.06) | $2.51 |
Net income (loss) per common share-diluted: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.74 | $0.67 | $0.73 | $0.64 | $0.62 | $0.69 | $0.57 | ($2.05) | $2.78 | ($0.10) | $1.55 |
Net income (loss) from discontinued operations, net of tax | $0.30 | ($0.28) | ($0.15) | ($0.01) | $0.04 | ($0.03) | ($0.03) | $0.05 | ($0.14) | $0.04 | $0.92 |
Net income (loss) per common share-diluted: | $1.04 | $0.39 | $0.58 | $0.63 | $0.66 | $0.66 | $0.54 | ($2) | $2.64 | ($0.06) | $2.47 |
Weighted average number of common shares: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic | ' | ' | ' | ' | ' | ' | ' | ' | 18,977,263 | 18,219,343 | 17,601,956 |
Diluted | ' | ' | ' | ' | ' | ' | ' | ' | 19,390,413 | 18,219,343 | 17,913,545 |
Other comprehensive income (loss), before tax: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Translation adjustment | ' | ' | ' | ' | ' | ' | ' | ' | 480 | -3,192 | -1,710 |
Unrealized gain (loss) on derivative instrument | ' | ' | ' | ' | ' | ' | ' | ' | 416 | -693 | -126 |
Other comprehensive income (loss), before tax | ' | ' | ' | ' | ' | ' | ' | ' | 896 | -3,885 | -1,836 |
Income tax (expense) benefit related to components of other comprehensive income | -153 | ' | ' | ' | 256 | ' | ' | ' | -153 | 256 | 36 |
Other comprehensive income (loss), net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 743 | -3,629 | -1,800 |
Comprehensive income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 52,038 | -4,702 | 42,408 |
Adjustments [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product sales | ' | ' | ' | ' | ' | ' | ' | ' | -14,811 | -27,828 | 2,062 |
Marketing service fees | ' | ' | ' | ' | ' | ' | ' | ' | 72 | -322 | -120 |
Net Sales | 5,330 | -6,895 | -6,069 | -7,105 | -4,446 | -5,796 | -8,454 | -9,454 | -14,739 | -28,150 | 1,942 |
Cost of sales | 6,440 | 2,011 | 3,871 | -561 | 4,061 | -728 | -431 | 6 | 11,761 | 2,908 | 6,632 |
Gross profit | -1,110 | -8,906 | -9,940 | -6,544 | -8,507 | -5,068 | -8,023 | -9,460 | -26,500 | -31,058 | -4,690 |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' | ' | ' | -13,212 | -6,634 | -4,722 |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | -436 | 107 | 98 |
Amortization of intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | 200 | 200 | 200 |
Charges related to U.S. Government resolutions (Note 17) | ' | ' | ' | ' | ' | ' | ' | ' | -678 | 678 | ' |
Total operating expenses | -2,242 | -6,178 | -3,673 | -2,033 | -870 | -2,436 | -986 | -1,357 | -14,126 | -5,649 | -4,424 |
Operating income | 1,132 | -2,728 | -6,267 | -4,511 | -7,637 | -2,632 | -7,037 | -8,103 | -12,374 | -25,409 | -266 |
Other income and (expense) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net | ' | ' | ' | ' | ' | ' | ' | ' | -166 | 3,915 | 4,930 |
Total other income (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -166 | 3,915 | 4,930 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -12,540 | -21,494 | 4,664 |
Income tax (expense) benefit | ' | ' | ' | ' | ' | ' | ' | ' | 3,654 | 7,016 | -1,425 |
Net income (loss) from continuing operations, net of tax | 1,373 | -2,544 | -4,097 | -3,618 | -3,878 | -1,651 | -3,940 | -5,009 | -8,886 | -14,478 | 3,239 |
Discontinued operations (Note 16) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain on sale of Breg, Inc., net of tax | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain on sale of vascular operations, net of tax (Note 22) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -3,498 |
Income (loss) from discontinued operations | ' | ' | ' | ' | ' | ' | ' | ' | 1,018 | -3,968 | -4,926 |
Income tax benefit (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -589 | 1,409 | 5,273 |
Net income (loss) from discontinued operations, net of tax | -726 | ' | 146 | 1,009 | -627 | -652 | -623 | -657 | 429 | -2,559 | -3,151 |
Net income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | -8,457 | -17,037 | 88 |
Net income (loss) per common share-basic: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.07 | ($0.14) | ($0.22) | ($0.19) | ($0.20) | ($0.09) | ($0.22) | ($0.28) | ($0.47) | ($0.79) | $0.18 |
Net income (loss) from discontinued operations, net of tax | ($0.03) | ' | $0.01 | $0.05 | ($0.04) | ($0.04) | ($0.04) | ($0.03) | $0.02 | ($0.14) | ($0.17) |
Net income (loss) per common share-basic | $0.04 | ($0.14) | ($0.21) | ($0.14) | ($0.24) | ($0.13) | ($0.26) | ($0.31) | ($0.45) | ($0.93) | $0.01 |
Net income (loss) per common share-diluted: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.07 | ($0.13) | ($0.22) | ($0.19) | ($0.21) | ($0.09) | ($0.22) | ($0.28) | ($0.46) | ($0.79) | $0.18 |
Net income (loss) from discontinued operations, net of tax | ($0.04) | ($0.01) | $0.01 | $0.05 | ($0.03) | ($0.03) | ($0.03) | ($0.03) | $0.03 | ($0.14) | ($0.18) |
Net income (loss) per common share-diluted: | ($0.03) | ($0.14) | ($0.21) | ($0.14) | ($0.24) | ($0.12) | ($0.25) | ($0.31) | ($0.43) | ($0.93) | ' |
Other comprehensive income (loss), before tax: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Translation adjustment | ' | ' | ' | ' | ' | ' | ' | ' | 288 | 913 | 393 |
Other comprehensive income (loss), before tax | ' | ' | ' | ' | ' | ' | ' | ' | 288 | 913 | 393 |
Other comprehensive income (loss), net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 288 | 913 | 393 |
Comprehensive income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | ($8,169) | ($16,124) | $481 |
Inventories_Schedule_of_Invent
Inventories - Schedule of Inventories (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 |
Inventory Disclosure [Abstract] | ' | ' |
Raw materials | $7,623 | $9,894 |
Work-in-process | 7,886 | 5,606 |
Finished products | 28,308 | 27,142 |
Field inventory | 22,629 | 23,237 |
Consignment inventory | 6,155 | 6,981 |
Deferred cost of sales | 10,772 | 8,668 |
Inventory, net | $83,373 | $81,528 |
Property_plant_and_equipment_S
Property, plant and equipment - Schedule of Property,Plant and Equipment (Detail) (USD $) | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||
Interest Cost Capitalized And Depreciation And Amortization Expenses For Property, Plant and Equipment [Line Items] | ' | ' |
Cost | $130,460 | $114,308 |
Accumulated depreciation | -76,625 | -68,171 |
Total | 53,835 | 46,137 |
Buildings [Member] | ' | ' |
Interest Cost Capitalized And Depreciation And Amortization Expenses For Property, Plant and Equipment [Line Items] | ' | ' |
Cost | 3,911 | 3,829 |
Plant, equipment and instrumentation [Member] | ' | ' |
Interest Cost Capitalized And Depreciation And Amortization Expenses For Property, Plant and Equipment [Line Items] | ' | ' |
Cost | 120,982 | 104,782 |
Furniture and fixtures [Member] | ' | ' |
Interest Cost Capitalized And Depreciation And Amortization Expenses For Property, Plant and Equipment [Line Items] | ' | ' |
Cost | $5,567 | $5,697 |
Property_plant_and_equipment_A
Property, plant and equipment - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Property Plant And Equipment Useful Life And Values [Abstract] | ' | ' | ' |
Depreciation expense | $15.80 | $14.30 | $13 |
Patents_and_other_intangible_a2
Patents and other intangible assets - Schedule of Patents and Other Intangibles Assets (Detail) (USD $) | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||
Finite And Indefinite Lived Intangible Assets [Line Items] | ' | ' |
Cost | $39,562 | $39,438 |
Accumulated amortization | -32,272 | -30,592 |
Patents and other intangible assets, net | 7,290 | 8,846 |
Patents [Member] | ' | ' |
Finite And Indefinite Lived Intangible Assets [Line Items] | ' | ' |
Cost | 38,905 | 38,893 |
Accumulated amortization | -31,845 | -30,211 |
Trademarks - definite lived [Member] | ' | ' |
Finite And Indefinite Lived Intangible Assets [Line Items] | ' | ' |
Cost | 657 | 545 |
Accumulated amortization | ($427) | ($381) |
Patents_and_other_intangible_a3
Patents and other intangible assets - Additional Information (Detail) (USD $) | Dec. 31, 2012 |
In Millions, unless otherwise specified | |
Future Amortization expense | ' |
2013 | $2.30 |
2014 | 1.6 |
2015 | 1.3 |
2016 | 1.2 |
2017 | 0.8 |
2018 and thereafter | $0.10 |
Goodwill_Schedule_of_Changes_i
Goodwill - Schedule of Changes in Net Carrying Amount of Goodwill (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 |
Goodwill [Line Items] | ' | ' |
Beginning balance | $73,094 | $73,598 |
Foreign currency | 1,294 | -504 |
Ending balance | 74,388 | 73,094 |
Spine [Member] | ' | ' |
Goodwill [Line Items] | ' | ' |
Beginning balance | 41,419 | 41,458 |
Foreign currency | 145 | -39 |
Ending balance | 41,564 | 41,419 |
Orthopedics [Member] | ' | ' |
Goodwill [Line Items] | ' | ' |
Beginning balance | 31,675 | 32,140 |
Foreign currency | 1,149 | -465 |
Ending balance | $32,824 | $31,675 |
Bank_borrowings_Additional_Inf
Bank borrowings - Additional Information (Detail) | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2011 |
In Millions, unless otherwise specified | USD ($) | EUR (€) | USD ($) | EUR (€) |
Debt Disclosure [Abstract] | ' | ' | ' | ' |
Weighted average interest rate on borrowings under lines of credit | 3.70% | 3.70% | 4.00% | 4.00% |
Amount outstanding under lines of credit | $0.10 | ' | $1.30 | ' |
Maximum borrowing capacity | $7.60 | € 5.80 | $8.10 | € 6.30 |
Other_current_liabilities_Summ
Other current liabilities - Summary of Other Current Liabilities (Detail) (USD $) | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||
Payables And Accruals [Abstract] | ' | ' |
Accrued expenses | $17,452 | $15,002 |
Salaries, bonuses, commissions and related taxes payable | 17,915 | 22,743 |
Other payables | 4,227 | 3,091 |
Total | $39,594 | $40,836 |
Longterm_debt_Additional_Infor
Long-term debt - Additional Information (Detail) | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | 31-May-12 | Aug. 31, 2010 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Dec. 31, 2011 | Aug. 30, 2010 | Dec. 31, 2011 | Dec. 31, 2011 | 31-May-12 | 31-May-11 | Aug. 31, 2010 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Aug. 31, 2010 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | |
USD ($) | USD ($) | USD ($) | EUR (€) | EUR (€) | LIBOR [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | Term Loan Facility [Member] | New Credit Agreement [Member] | New Credit Agreement [Member] | New Credit Agreement [Member] | Prior Credit Agreement [Member] | Prior Credit Agreement [Member] | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | LIBOR [Member] | Base rate [Member] | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | LIBOR [Member] | Base rate [Member] | USD ($) | LIBOR [Member] | Base rate [Member] | ||||||||||
USD ($) | USD ($) | USD ($) | Maximum [Member] | Maximum [Member] | Maximum [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument term (in years) | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity | $7,600,000 | $8,100,000 | ' | € 5,800,000 | € 6,300,000 | ' | ' | ' | ' | ' | ' | ' | $200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum additional borrowing capacity available | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000,000 | ' | ' | ' | ' |
Repayment of debt obligation | 188,695,000 | 7,500,000 | 36,269,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 87,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repayment of debt obligation | ' | ' | ' | ' | ' | ' | 57,500,000 | ' | 20,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount outstanding | 100,000 | 1,300,000 | ' | ' | ' | ' | ' | ' | ' | 20,000,000 | 20,000,000 | 117,400,000 | ' | ' | ' | ' | ' | ' | 91,300,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Margin on variable rate | ' | ' | ' | ' | ' | 2.50% | ' | ' | ' | ' | ' | ' | ' | 3.00% | 2.00% | ' | ' | ' | ' | ' | 3.00% | ' | ' | 3.25% | 2.25% | ' | ' |
Variable rate basis | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'LIBOR | ' | ' | ' | ' | ' |
Portion of credit facility charged at variable rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000,000 | 17,400,000 | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | ' | ' | ' | ' |
Effective interest rate (as a Percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.70% | 3.40% |
Amount of restricted net assets | 213,400,000 | 162,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restricted cash | 21,314,000 | 45,476,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt issuance costs incurred | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 800,000 | ' | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred debt issuance costs, net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $3,500,000 | $1,800,000 | ' | ' | ' | ' | ' | ' | ' |
Derivative_instruments_Schedul
Derivative instruments - Schedule of Fair Values of Derivative Instruments (Detail) (Cross-currency swap [Member], Other long-term assets [Member], USD $) | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||
Cross-currency swap [Member] | Other long-term assets [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Fair value: favorable (unfavorable) | $305 | $1,011 |
Derivative_instruments_Schedul1
Derivative instruments - Schedule of Gain (Loss) Recognized on Derivative Instruments (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Derivative Instruments [Line Items] | ' | ' | ' |
Cross-currency swap gain (loss) recorded in other comprehensive income (loss), net of taxes | $263 | ($437) | ($90) |
Interest Rate Swap [Member] | ' | ' | ' |
Derivative Instruments [Line Items] | ' | ' | ' |
Interest rate swap gain recognized in net income (loss) | ' | ' | 1,254 |
Cross-currency swap [Member] | ' | ' | ' |
Derivative Instruments [Line Items] | ' | ' | ' |
Cross-currency swap gain (loss) recorded in other comprehensive income (loss), net of taxes | $263 | ($437) | ($90) |
Derivative_instruments_Additio
Derivative instruments - Additional Information (Detail) | Sep. 30, 2010 | Sep. 30, 2010 | Jun. 30, 2008 | Dec. 31, 2010 |
In Millions, unless otherwise specified | Cross-currency swap [Member] | Cross-currency swap [Member] | Interest Rate Swap [Member] | Interest Rate Swap [Member] |
Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | De-designated hedges [Member] | De-designated hedges [Member] | |
Pay Euros [Member] | Receive U.S. dollars [Member] | USD ($) | USD ($) | |
EUR (€) | USD ($) | |||
Derivatives, Fair Value [Line Items] | ' | ' | ' | ' |
Notional amount | € 28.70 | $39 | $150 | ' |
Fixed rate (as a percent) | 5.00% | 4.64% | ' | ' |
Gain on settlement of derivative instrument | ' | ' | ' | $1.30 |
Period of amortizable interest rate swap agreement | ' | ' | '3 years | ' |
Fair_value_measurements_Schedu
Fair value measurements - Schedule of Financial Assets and Liabilities Recorded at Fair Value on Recurring Basis (Detail) (Fair Value, Measurements, Recurring [Member], USD $) | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cross currency hedge | $305 | $1,011 |
Fair Value, Inputs, Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cross currency hedge | $305 | $1,011 |
Commitments_Additional_Informa
Commitments - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Commitments And Contingencies Disclosure [Abstract] | ' | ' | ' |
Rent expenses | $4.10 | $4.80 | $6.80 |
Commitments_Schedule_of_Future
Commitments - Schedule of Future Minimum Lease Payments Under Operating Leases, Net of Amount to be Received Under Sub Leases (Detail) (USD $) | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |
Commitments And Contingencies Disclosure [Abstract] | ' |
2013 | $3,340 |
2014 | 2,992 |
2015 | 2,816 |
2016 | 2,677 |
2017 | 2,620 |
Thereafter | 2,624 |
Total | $17,069 |
Business_segment_information_A
Business segment information - Additional Information (Detail) (Segment [Member]) | 12 Months Ended |
Dec. 31, 2012 | |
Business_Unit | |
Segment [Member] | ' |
Product Type Reporting Information [Line Items] | ' |
Number of GBUs | 2 |
Business_segment_information_B
Business segment information - Business Segments by GBU (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Product Type Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of Total Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | 100.00% | 100.00% |
Net Sales | $117,365 | $107,857 | $113,423 | $108,936 | $118,639 | $111,510 | $108,216 | $103,606 | $447,581 | $441,971 | $462,571 |
Spine Repair Implants and Regenerative Biologics [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of Total Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 32.00% | 28.00% | 29.00% |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 142,829 | 124,415 | 132,938 |
Spine Regenerative Stimulation [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of Total Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 36.00% | 37.00% | 37.00% |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 159,289 | 160,946 | 172,574 |
Spine [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of Total Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 68.00% | 65.00% | 66.00% |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 302,118 | 285,361 | 305,512 |
Orthopedics [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of Total Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 32.00% | 35.00% | 34.00% |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | $145,463 | $156,610 | $157,059 |
Business_segment_information_O
Business segment information - Operating Income (Loss) by GBU (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Product Type Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating income (loss) | $25,613 | $18,805 | $14,298 | $17,920 | $8,174 | $20,967 | $12,359 | ($35,600) | $76,636 | $5,900 | $65,984 |
Spine [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 80,528 | 31,173 | 78,451 |
Orthopedics [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 13,197 | 3,779 | 7,847 |
Corporate [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | ($17,089) | ($29,052) | ($20,314) |
Business_segment_information_O1
Business segment information - Operating Income (Loss) by GBU (Parenthetical) (Detail) (USD $) | 12 Months Ended | |
Dec. 31, 2012 | Dec. 31, 2011 | |
Product Type Reporting Information [Line Items] | ' | ' |
Charges related to U.S. Government resolutions | ($83,178,000) | $89,101,000 |
Spine [Member] | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' |
Charges related to U.S. Government resolutions | ' | 43,100,000 |
Orthopedics [Member] | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' |
Charges related to U.S. Government resolutions | ' | 6,500,000 |
Corporate [Member] | ' | ' |
Product Type Reporting Information [Line Items] | ' | ' |
Charges related to U.S. Government resolutions | ' | 7,500,000 |
Senior management succession charges | ' | $3,200,000 |
Business_segment_information_S
Business segment information - Selected Financial Information by Reporting Segment (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Segment Related Capital Expenditure And Depreciation And Amortization On Those Expenditure [Line Items] | ' | ' | ' |
Depreciation and amortization | $20,580 | $23,017 | $22,087 |
Spine [Member] | ' | ' | ' |
Segment Related Capital Expenditure And Depreciation And Amortization On Those Expenditure [Line Items] | ' | ' | ' |
Depreciation and amortization | 12,260 | 11,091 | 8,973 |
Orthopedics [Member] | ' | ' | ' |
Segment Related Capital Expenditure And Depreciation And Amortization On Those Expenditure [Line Items] | ' | ' | ' |
Depreciation and amortization | 5,605 | 5,506 | 6,282 |
Corporate [Member] | ' | ' | ' |
Segment Related Capital Expenditure And Depreciation And Amortization On Those Expenditure [Line Items] | ' | ' | ' |
Depreciation and amortization | $280 | $263 | $126 |
Business_segment_information_S1
Business segment information - Summary of Net Sales by Geographic Destination (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Schedule Of Net Sales By Geographical Segment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | $117,365 | $107,857 | $113,423 | $108,936 | $118,639 | $111,510 | $108,216 | $103,606 | $447,581 | $441,971 | $462,571 |
Domestic [Member] | U.S. [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Schedule Of Net Sales By Geographical Segment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 334,624 | 328,585 | 340,328 |
International [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Schedule Of Net Sales By Geographical Segment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 112,957 | 113,386 | 122,243 |
International [Member] | U.K. [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Schedule Of Net Sales By Geographical Segment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 8,431 | 8,206 | 12,509 |
International [Member] | Italy [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Schedule Of Net Sales By Geographical Segment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 18,742 | 17,447 | 19,181 |
International [Member] | Brazil [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Schedule Of Net Sales By Geographical Segment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | 31,166 | 34,424 | 31,112 |
International [Member] | Others [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Schedule Of Net Sales By Geographical Segment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | $54,618 | $53,309 | $59,441 |
Business_segment_information_A1
Business segment information - Analysis of Property, Plant and Equipment of Reporting Segments by Geographic Area (Detail) (USD $) | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||
Geographic Information [Line Items] | ' | ' |
Property, plant and equipment, net | $53,835 | $46,137 |
U.S. [Member] | ' | ' |
Geographic Information [Line Items] | ' | ' |
Property, plant and equipment, net | 39,554 | 33,575 |
Italy [Member] | ' | ' |
Geographic Information [Line Items] | ' | ' |
Property, plant and equipment, net | 7,617 | 7,663 |
U.K. [Member] | ' | ' |
Geographic Information [Line Items] | ' | ' |
Property, plant and equipment, net | 1,402 | 1,449 |
Brazil [Member] | ' | ' |
Geographic Information [Line Items] | ' | ' |
Property, plant and equipment, net | 3,421 | 2,532 |
Others [Member] | ' | ' |
Geographic Information [Line Items] | ' | ' |
Property, plant and equipment, net | $1,841 | $918 |
Income_taxes_Schedule_of_Provi
Income taxes - Schedule of Provision for (Benefit from) Income Taxes on Continuing Operations (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
U.S. | ' | ' | ' |
Current | $17,897 | $25,148 | $19,336 |
Deferred | 1,788 | -12,657 | 2,282 |
Total U.S | 19,685 | 12,491 | 21,618 |
Non-U.S. | ' | ' | ' |
Current | 4,609 | 2,735 | 253 |
Deferred | 844 | -1,061 | 2,160 |
Total Non U.S | 5,453 | 1,674 | 2,413 |
Income tax expense | $25,138 | $14,165 | $24,031 |
Income_taxes_Schedule_of_Tax_E
Income taxes - Schedule of Tax Effects of Significant Temporary Differences Comprising Deferred Tax Assets and Liabilities (Detail) (USD $) | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||
Income Tax Disclosure [Abstract] | ' | ' |
Intangible assets and goodwill | $5,346 | $5,300 |
Inventories and related reserves | 14,020 | 13,756 |
Deferred revenue and cost of sales | 11,682 | 7,631 |
Other accruals and reserves | 3,868 | 10,287 |
Accrued compensation | 3,817 | 4,444 |
Allowance for doubtful accounts | 3,718 | 4,029 |
Accrued interest | 18,229 | 16,123 |
Net operating loss carryforwards | 27,231 | 20,849 |
Other, net | 539 | -349 |
Total | 88,450 | 82,070 |
Valuation allowance | -26,361 | -19,124 |
Deferred tax asset | 62,089 | 62,946 |
Withholding taxes | -11,456 | -9,778 |
Property, plant and equipment | -9,758 | -9,892 |
Deferred tax liability | -21,214 | -19,670 |
Net deferred tax assets | $40,875 | $43,276 |
Income_taxes_Additional_Inform
Income taxes - Additional Information (Detail) (USD $) | 12 Months Ended | |||
Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | |
Components Of Income Tax Expense Benefit [Line Items] | ' | ' | ' | ' |
Valuation allowance | $26,361,000 | $19,124,000 | ' | ' |
Net increase in valuation allowance | 7,300,000 | ' | ' | ' |
Operating loss carry forwards, state, net of tax | 21,900,000 | ' | ' | ' |
Operating loss carry forwards, foreign, net of tax | 102,700,000 | ' | ' | ' |
Income tax expense | 25,138,000 | 14,165,000 | 24,031,000 | ' |
Income tax effective rate | 35.80% | -690.00% | 43.70% | ' |
Income tax effective rate excluding the impact of the charges related to the U.S Government resolutions (as a percent) | 42.00% | 149.10% | ' | ' |
Unrecognized tax benefit | 1,200,000 | 600,000 | ' | ' |
Accrued interest and penalties related to unrecognized tax benefits | 800,000 | 600,000 | ' | ' |
Unremitted foreign earnings | 292,000,000 | 285,300,000 | ' | ' |
Total cash and cash equivalents | 31,055,000 | 33,207,000 | 13,561,000 | 13,328,000 |
U.S. Subsidiary [Member] | ' | ' | ' | ' |
Components Of Income Tax Expense Benefit [Line Items] | ' | ' | ' | ' |
Unremitted foreign earnings | 293,800,000 | ' | ' | ' |
U.S [Member] | ' | ' | ' | ' |
Components Of Income Tax Expense Benefit [Line Items] | ' | ' | ' | ' |
Total cash and cash equivalents | 52,300,000 | ' | ' | ' |
Restricted cash | 21,300,000 | ' | ' | ' |
Non-Us Subsidiary [Member] | ' | ' | ' | ' |
Components Of Income Tax Expense Benefit [Line Items] | ' | ' | ' | ' |
Total cash and cash equivalents | $31,000,000 | ' | ' | ' |
Income_taxes_Schedule_of_Effec
Income taxes - Schedule of Effective Income Tax Rate Reconciliation for Continuing Operations (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Income Tax Disclosure [Abstract] | ' | ' | ' | ' | ' |
Statutory U.S. federal income tax rate | ' | ' | 35.00% | 35.00% | 35.00% |
State taxes, net | ' | ' | 2.40% | -92.40% | 3.70% |
Foreign rate differential | ' | ' | -4.40% | -77.20% | 0.50% |
Valuation allowance-foreign losses | ' | ' | 8.80% | -237.80% | 6.40% |
SRL Intangible | ' | ' | -3.20% | 117.90% | -4.70% |
Domestic manufacturing deduction | ' | ' | -2.40% | 82.90% | -2.80% |
Withholding Taxes | ' | ' | 2.40% | -81.60% | 3.10% |
Settlement of U.S. Government resolutions | ' | ' | -1.80% | -463.70% | ' |
Other items, net | ' | ' | -1.00% | 26.90% | 2.50% |
Income tax expense/effective rate | ' | ' | 35.80% | -690.00% | 43.70% |
Statutory U.S. federal income tax rate | ' | ' | $24,565 | ($719) | $19,261 |
State taxes, net | ' | ' | 1,708 | 1,896 | 2,051 |
Foreign rate differential | ' | ' | -3,115 | 1,585 | 251 |
Valuation allowance-foreign losses | ' | ' | 6,183 | 4,882 | 3,497 |
SRL Intangible | ' | ' | -2,214 | -2,421 | -2,607 |
Domestic manufacturing deduction | ' | ' | -1,694 | -1,703 | -1,529 |
Withholding Taxes | ' | ' | 1,679 | 1,676 | 1,687 |
Settlement of U.S. Government resolutions | 10,500 | 46,000 | -1,260 | 9,520 | ' |
Other items, net | ' | ' | -714 | -551 | 1,420 |
Income tax expense | ' | ' | $25,138 | $14,165 | $24,031 |
Income_taxes_Schedule_of_Gross
Income taxes - Schedule of Gross Unrecognized Tax Benefits (Excluding Interest and Penalties) (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 |
Income Tax Disclosure [Abstract] | ' | ' |
Beginning Balance | $610 | $569 |
Additions for current year tax positions | 793 | 86 |
Decreases for prior year tax positions | -106 | -17 |
Expiration of statutes | -108 | -28 |
Ending Balance | $1,189 | $610 |
Related_parties_Summary_of_Rel
Related parties - Summary of Related Party Balances and Transactions (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Related Party Transactions [Abstract] | ' | ' | ' |
Sales | ' | $479 | $3,081 |
Purchases | ' | ' | 4,911 |
Accounts payable | ' | ' | 334 |
Accounts receivable | ' | $106 | $676 |
Sale_of_Breg_and_Disposition_o2
Sale of Breg and Disposition of Sports Medicine GBU - Additional information (Detail) (USD $) | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | 31-May-12 | Dec. 31, 2012 | 24-May-12 | |
Breg Orthofix Holdings, Inc [Member] | Sports Medicine [Member] | Sports Medicine [Member] | Orthofix Inc [Member] | Orthofix Inc [Member] | Orthofix Inc [Member] | |
Breg Orthofix Holdings, Inc [Member] | Breg Orthofix Holdings, Inc [Member] | Breg Orthofix Holdings, Inc [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' | ' |
Proceeds from sale of outstanding shares of Breg | ' | ' | ' | $157,500,000 | ' | ' |
Prepayment of outstanding company indebtedness | ' | ' | ' | 145,000,000 | ' | ' |
Fair value of liability | ' | ' | ' | ' | ' | 2,000,000 |
Obligations under guarantee | 2,000,000 | ' | ' | ' | 1,600,000 | ' |
Period of indemnification | ' | ' | ' | ' | '3 years | ' |
Net Sales | ' | 44,000,000 | 108,900,000 | ' | ' | ' |
Operating income (loss) | ' | $2,900,000 | $1,200,000 | ' | ' | ' |
Sale_of_Breg_and_Disposition_o3
Sale of Breg and Disposition of Sports Medicine GBU - Schedule of Information Related to Sale of Breg (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2010 |
Less: | ' | ' |
Gain on sale of Breg | ' | $8,521 |
Gain on sale, net of taxes | 1,345 | ' |
Breg Orthofix Holdings, Inc [Member] | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Cash proceeds | 157,500 | ' |
Less: | ' | ' |
Working Capital | -7,093 | ' |
Transaction related expenses | -4,276 | ' |
Fair Value of Indemnification | -2,000 | ' |
Tangible assets | -8,309 | ' |
Intangible assets | -28,164 | ' |
Goodwill | -106,200 | ' |
Gain on sale of Breg | 1,458 | ' |
Income tax expense | -113 | ' |
Gain on sale, net of taxes | $1,345 | ' |
Sale_of_Breg_and_Disposition_o4
Sale of Breg and Disposition of Sports Medicine GBU - Schedule of Assets and Liabilities of Discontinued Operations (Detail) (Sports Medicine [Member], USD $) | Dec. 31, 2011 |
In Thousands, unless otherwise specified | |
Sports Medicine [Member] | ' |
Assets Held for Sale | ' |
Restricted cash | $1,629 |
Trade accounts receivable, less allowance | 13,711 |
Inventories, net | 8,277 |
Property, plant and equipment, net | 8,756 |
Intangible assets, net | 29,279 |
Goodwill | 106,279 |
Deferred income taxes, prepaid expenses and other assets | 3,254 |
Assets Held for Sale | 171,185 |
Liabilities Held for Sale | ' |
Trade accounts payable | 3,616 |
Deferred income taxes and other liabilities | 19,060 |
Liabilities Held for Sale | $22,676 |
Contingencies_Additional_infor
Contingencies - Additional information (Detail) (USD $) | 1 Months Ended | 12 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | ||
Jul. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Jan. 31, 2012 | Dec. 31, 2012 | Jul. 31, 2012 | Dec. 31, 2012 | Mar. 31, 2011 | Dec. 31, 2012 | |
Breg, Inc. [Member] | Past Liability Due [Member] | Future Liability [Member] | Litigation related to Blackstone [Member] | Litigation related to Promeca [Member] | Litigation Related to Breg [Member] | Orthofix Inc [Member] | Orthofix Inc [Member] | Orthofix Inc [Member] | |||
Litigation related to Bone Growth Stimulation Business [Member] | Litigation related to Bone Growth Stimulation Business [Member] | ||||||||||
Loss Contingencies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount approved to be paid under the agreement | ' | ' | ' | ' | ' | $32,000,000 | ' | ' | $34,200,000 | ' | ' |
Settlement of imputed interest accrued | ' | 300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate on settlement amount approved to be paid under the agreement (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | 3.00% | ' | ' |
Counseling fees | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000 | ' | ' |
Settlement agreement description | ' | ' | ' | ' | ' | ' | ' | ' | 'The Company agreed to pay $34.2 million (plus interest at a rate of 3% from May 5, 2011 through the day before payment was made) | ' | ' |
Amount of fine | ' | ' | ' | ' | ' | ' | 2,200,000 | ' | 7,800,000 | ' | ' |
Mandatory special assessment | ' | ' | ' | ' | ' | ' | ' | ' | 400 | ' | ' |
Company terms and corporate integrity agreement expiration term | ' | ' | ' | ' | ' | ' | ' | ' | 'Five year | ' | ' |
Charges accrued in connection with litigation | 4,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | 43,000,000 | ' |
Imputed Interest settlement against the charge | ' | ' | ' | ' | ' | ' | 5,200,000 | ' | ' | ' | 1,700,000 |
Deferred prosecution agreement term | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Judgments and settlement costs | ' | ' | 6,100,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated reimbursement | ' | ' | ' | 13,000,000 | 15,000,000 | ' | ' | ' | ' | ' | ' |
Amount recorded in discontinued operations | ' | ' | ' | 13,000,000 | ' | ' | ' | ' | ' | ' | ' |
Compensatory damages to plaintiff | ' | ' | ' | ' | ' | ' | ' | 2,100,000 | ' | ' | ' |
Exemplary damages | ' | ' | ' | ' | ' | ' | ' | 7,000,000 | ' | ' | ' |
Discontinued operations for compensatory damages and exemplary damages | $4,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Pensions_and_deferred_compensa1
Pensions and deferred compensation - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Orthofix Inc 401(k) Plan [Member] | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' |
Employee contribution limit per calendar year (as a percent of compensation) | 15.00% | ' | ' |
Employer match of employee contributions of first level of eligible compensation (as a percent) | 100.00% | ' | ' |
Percentage of eligible compensation, matched by employer, level one | 2.00% | ' | ' |
Employer match of employee contributions of second level of eligible compensation (as a percent) | 50.00% | ' | ' |
Percentage of eligible compensation matched by employer, level two | 4.00% | ' | ' |
401 (k) Plans [Member] | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' |
Expenses incurred for contribution plans | $2.50 | $2.50 | $2.80 |
Defined Contribution pension plans for other International employees [Member] | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' |
Expenses incurred for contribution plans | 0.7 | 0.8 | 0.7 |
Deferred Compensation Plan [Member] | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' |
Annual deferred compensation provision for leaving indemnity, as a percentage of total commissions earned | 3.50% | ' | ' |
Expense for deferred compensation | 0.4 | 0.1 | 0.1 |
Deferred compensation payments | 0.8 | 0 | 0.2 |
Amount of deferred compensation payable | $2.30 | $1.50 | ' |
Share_based_compensation_plans
Share based compensation plans - Additional Information (Detail) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | ||||||||||||||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Jun. 29, 2004 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 |
Restricted Stock [Member] | Restricted Stock [Member] | Staff Share Option Plan [Member] | Stock Purchase Plan [Member] | Stock Purchase Plan [Member] | Stock Purchase Plan [Member] | Stock Purchase Plan [Member] | 2004 LTIP Plan [Member] | 2004 LTIP Plan [Member] | 2004 LTIP Plan [Member] | 2004 LTIP Plan [Member] | 2004 LTIP Plan [Member] | 2004 LTIP Plan [Member] | 2004 LTIP Plan [Member] | ||||
North America, South America And Asia [Member] | Maximum [Member] | Maximum [Member] | Minimum [Member] | Staff Share Option Plan [Member] | Employees [Member] | Non-Employees Director [Member] | Maximum [Member] | Minimum [Member] | |||||||||
Customers and distributors based in Europe [Member] | Non-Employees Director [Member] | Non-Employees Director [Member] | |||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of shares reserved for issuance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,600,000 | 3,100,000 | ' | ' | ' | ' | ' |
Options exercisable | 1,448,293 | ' | ' | ' | ' | 29,600 | ' | ' | ' | ' | 156,000 | ' | 1,218,693 | ' | ' | ' | ' |
Restricted stock outstanding | 160,831 | 69,000 | ' | ' | ' | ' | ' | ' | ' | ' | 125,500 | ' | 35,331 | ' | ' | ' | ' |
Award vesting period | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | '5 years | '3 years |
Number of shares approved for annual grant | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000 | ' | ' |
Award Contractual term | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' |
Full value award limit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' |
Options outstanding | 1,945,955 | 2,559,272 | ' | ' | ' | 29,600 | ' | ' | ' | ' | ' | ' | 1,460,355 | ' | ' | ' | ' |
Percentage of compensation eligible employees to be deducted for purchase of common stock | ' | ' | ' | ' | ' | ' | 25.00% | 25.00% | 15.00% | 1.00% | ' | ' | ' | ' | ' | ' | ' |
Purchase price of shares equivalent to fair market value | 85.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate number of shares reserved for issuance under the Employee Stock Purchase Plan | 1,850,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued under stock purchase plan | 1,362,808 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unamortized compensation expense | $3.90 | ' | ' | $4.80 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average remaining contractual life of exercisable options (in years) | '4 years 2 months 12 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total intrinsic value of options exercised | 7.2 | 4.2 | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Closing stock price | $39.33 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate intrinsic value of options outstanding | 11.2 | 10.8 | 4.8 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate intrinsic value of options exercisable | $9.80 | $8.40 | $2.10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-vested shares | 149,500 | ' | ' | 149,500 | 94,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sharebased_compensation_plans_1
Share-based compensation plans - Schedule of Assumption for Share Based Compensation (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Expected term | '4 years 6 months | '4 years 6 months 29 days | ' |
Dividend rate | ' | ' | ' |
Weighted average fair value of options granted during the year | $16.99 | $14.21 | ' |
Minimum [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Risk free interest rate | 0.76% | 0.90% | ' |
Expected volatility | 50.90% | 49.60% | ' |
Maximum [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Risk free interest rate | 0.84% | 2.26% | ' |
Expected volatility | 51.80% | 49.90% | ' |
Sharebased_compensation_plans_2
Share-based compensation plans - Schedule of Share-Based Compensation by Line Item in Consolidated Statements of Operations (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Allocated share based compensation expense | $6,303 | $6,648 | $8,138 |
Cost of sales [Member] | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Allocated share based compensation expense | 592 | 153 | 210 |
Sales and marketing [Member] | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Allocated share based compensation expense | 1,550 | 2,031 | 3,505 |
General and administrative [Member] | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Allocated share based compensation expense | 4,023 | 4,322 | 4,105 |
Research and development [Member] | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Allocated share based compensation expense | $138 | $142 | $318 |
Share_based_compensation_plans1
Share based compensation plans - Schedule of Stock Option Activity (Detail) (USD $) | 12 Months Ended |
Dec. 31, 2012 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' |
Outstanding at the beginning of the period (in shares) | 2,559,272 |
Granted | 347,250 |
Exercised | -716,564 |
Forfeited | -244,003 |
Outstanding at the end of the period (in shares) | 1,945,955 |
Vested and expected to vest | 1,903,616 |
Options exercisable (in shares) | 1,448,293 |
Outstanding at the beginning of the period (in dollars per share) | $33.41 |
Granted | $40.46 |
Exercised | $31.50 |
Forfeited | $40.50 |
Outstanding at the end of the period (in dollars per share) | $34.50 |
Vested and expected to vest | $34.42 |
Options exercisable | ' |
Options outstanding, weighted average remaining contractual term | '5 years 4 months 21 days |
Options vested and expected, weighted average remaining contractual term | '5 years 3 months 22 days |
Options exercisable, weighted average remaining contractual term | '4 years 2 months 12 days |
Share_based_compensation_plans2
Share based compensation plans - Schedule of Stock Options Outstanding and Exercisable by Price Range (Detail) (USD $) | 12 Months Ended |
Dec. 31, 2012 | |
$10.42 - $25.01 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $10.42 |
Exercise price, high end of range (in dollars per share) | $25.01 |
Number outstanding (in shares) | 253,661 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '5 years 1 month 2 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $23.40 |
Number Exercisable (in shares) | 253,661 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $23.40 |
$25.05 - $28.95 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $25.05 |
Exercise price, high end of range (in dollars per share) | $28.95 |
Number outstanding (in shares) | 326,383 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '5 years 3 months 18 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $26.96 |
Number Exercisable (in shares) | 314,383 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $26.97 |
$29.23 - $33.01 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $29.23 |
Exercise price, high end of range (in dollars per share) | $33.01 |
Number outstanding (in shares) | 314,433 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '6 years 10 months 2 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $31.60 |
Number Exercisable (in shares) | 167,102 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $31.44 |
$33.08 - $38.11 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $33.08 |
Exercise price, high end of range (in dollars per share) | $38.11 |
Number outstanding (in shares) | 347,859 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '3 years 6 months |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $37.49 |
Number Exercisable (in shares) | 307,194 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $37.51 |
$38.40 - $39.94 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $38.40 |
Exercise price, high end of range (in dollars per share) | $39.94 |
Number outstanding (in shares) | 282,687 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '6 years 7 months 10 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $39.68 |
Number Exercisable (in shares) | 126,687 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $39.69 |
$40.27 - $41.37 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $40.27 |
Exercise price, high end of range (in dollars per share) | $41.37 |
Number outstanding (in shares) | 210,000 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '7 years 18 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $41.22 |
Number Exercisable (in shares) | 68,334 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $41.20 |
$38.11 - $39.24 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $43.04 |
Exercise price, high end of range (in dollars per share) | $45.84 |
Number outstanding (in shares) | 188,932 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '3 years 5 months 19 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $44.63 |
Number Exercisable (in shares) | 188,932 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $44.63 |
$43.04 - $45.84 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $50.15 |
Exercise price, high end of range (in dollars per share) | $50.15 |
Number outstanding (in shares) | 12,500 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '4 years 3 months 15 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $50.15 |
Number Exercisable (in shares) | 12,500 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $50.15 |
$50.15 - $50.15 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $50.50 |
Exercise price, high end of range (in dollars per share) | $50.50 |
Number outstanding (in shares) | 2,000 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '4 years 4 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $50.50 |
Number Exercisable (in shares) | 2,000 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $50.50 |
$50.50 - $50.50 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $50.99 |
Exercise price, high end of range (in dollars per share) | $50.99 |
Number outstanding (in shares) | 7,500 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '4 years 15 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $50.99 |
Number Exercisable (in shares) | 7,500 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $50.99 |
$50.99 - $50.99 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price, low end of range (in dollars per share) | $10.42 |
Exercise price, high end of range (in dollars per share) | $50.99 |
Number outstanding (in shares) | 1,945,955 |
Weighted Average Remaining Contractual Life of options outstanding (in years) | '5 years 4 months 21 days |
Weighted Average Exercise Price of options outstanding (in dollars per share) | $34.50 |
Number Exercisable (in shares) | 1,448,293 |
Weighted Average Exercise Price of options exercisable (in dollars per share) | $33.54 |
Share_based_compensation_plans3
Share based compensation plans - Schedule of Changes in Restricted Stock (Detail) (USD $) | 12 Months Ended |
Dec. 31, 2012 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' |
Non-vested at the beginning of the period (in shares) | 69,000 |
Granted (in shares) | 149,500 |
Vested (in shares) | -28,336 |
Cancelled (in shares) | -29,333 |
Non-vested at the end of the period (in shares) | 160,831 |
Non-vested at the beginning of period (in dollars per share) | $29.23 |
Granted (in dollars per share) | $40.93 |
Vested (in dollars per share) | $29.23 |
Cancelled (in dollars per share) | $38.87 |
Non-vested at the end of period (in dollars per share) | $38.34 |
Earnings_per_share_Schedule_of
Earnings per share - Schedule of Reconciliation of Weighted Average Shares Used in Calculation of Basic and Diluted Earnings Per Share (Detail) | 12 Months Ended | ||
Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Earnings Per Share [Abstract] | ' | ' | ' |
Weighted average common shares-basic | 18,977,263 | 18,219,343 | 17,601,956 |
Effect of diluted securities: | ' | ' | ' |
Unexercised stock options net of treasury share repurchase | 413,150 | ' | 311,589 |
Weighted average common share-diluted | 19,390,413 | 18,219,343 | 17,913,545 |
Earnings_per_share_Additional_
Earnings per share - Additional Information (Detail) | 12 Months Ended | |
Dec. 31, 2012 | Dec. 31, 2011 | |
Common stock equivalents [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Outstanding options not included in diluted earnings per share | ' | 344,168 |
Options to purchase common stock [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Outstanding options not included in diluted earnings per share | 789,650 | 1,487,809 |
Restructuring_charges_Addition
Restructuring charges - Additional Information (Detail) (USD $) | 12 Months Ended | 3 Months Ended | |||
Dec. 31, 2010 | Dec. 31, 2010 | Jun. 30, 2010 | Dec. 31, 2010 | Dec. 31, 2010 | |
Severance [Member] | 2010 plan [Member] | 2008 plan [Member] | Spine [Member] | Orthopedics [Member] | |
2010 plan [Member] | 2010 plan [Member] | ||||
Severance [Member] | Severance [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' |
Recognition of restructuring expense | $3,550,000 | ' | $3,600,000 | $400,000 | $3,200,000 |
Restructuring Charges recorded in selling and marketing expenses | ' | 1,600,000 | ' | ' | ' |
Restructuring Charges recorded in general and administrative expenses | ' | $2,000,000 | ' | ' | ' |
Restructuring_charges_Schedule
Restructuring charges - Schedule of Changes in Restructuring Liability (Detail) (Severance [Member], USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2011 | Dec. 31, 2010 |
Severance [Member] | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' |
Balance | $1,638 | $1,826 |
Charges under 2010 plan | ' | 3,550 |
Cash payments | -1,638 | -3,738 |
Balance | ' | $1,638 |
Net_gain_on_sale_of_vascular_o2
Net gain on sale of vascular operations - Disc Ops - Additional Information (Detail) (Vascular operation [Member], USD $) | 0 Months Ended |
In Millions, unless otherwise specified | Mar. 08, 2010 |
Days | |
Years | |
Agreement | |
Months | |
Vascular operation [Member] | ' |
Assets Disposed of by Method Other than Sale, in Period of Disposition [Line Items] | ' |
Proceeds from sale of non-core operation, net of litigation | $27.70 |
Period of operational support with respect to the transport assets, maximum (in months) | 5 |
Number of supply agreements covered by transition services agreement | 2 |
Period of supply agreement (in years) | 2 |
Period of agreements to provide other products (in days) | 90 |
Period of non competition agreement (in years) | 5 |
Number of supply agreements completed | 1 |
Net_gain_on_sale_of_vascular_o3
Net gain on sale of vascular operations - Disc Ops - Schedule of Information Related to Sale of Vascular Operation (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2010 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Cash proceeds, net of litigation | ' | $24,215 |
Net gain on sale of vascular operations | ' | 8,521 |
Gain on sale, net of taxes | 1,345 | ' |
Vascular operation [Member] | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Cash proceeds, net of litigation | ' | 24,215 |
Transaction related expenses | ' | 2,253 |
Inventory and property, plant and equipment | ' | 2,369 |
Goodwill and intangible assets | ' | 7,574 |
Net gain on sale of vascular operations | ' | 12,019 |
Income tax expense | ' | -3,498 |
Gain on sale, net of taxes | ' | $8,521 |
Net_gain_on_sale_of_vascular_o4
Net gain on sale of vascular operations - Disc Ops - Schedule of Information Related to Sale of Vascular Operation (Parenthetical) (Detail) (Vascular operation [Member], USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2012 |
Vascular operation [Member] | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' |
Settlement of litigation claim by former patent holders | $3.50 |
Quarterly_financial_data_Conde
Quarterly financial data - Condensed Consolidated Statement of Operations (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Interim Reporting [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | $117,365 | $107,857 | $113,423 | $108,936 | $118,639 | $111,510 | $108,216 | $103,606 | $447,581 | $441,971 | $462,571 |
Cost of sales | 24,944 | 24,384 | 27,547 | 21,378 | 27,300 | 23,126 | 22,755 | 22,346 | 98,253 | 95,527 | 97,093 |
Gross profit | 92,421 | 83,473 | 85,876 | 87,558 | 91,339 | 88,384 | 85,461 | 81,260 | 349,328 | 346,444 | 365,478 |
Operating expense | 66,808 | 64,668 | 71,578 | 69,638 | 83,165 | 67,417 | 73,102 | 116,860 | 272,692 | 340,544 | 299,494 |
Operating income (loss) | 25,613 | 18,805 | 14,298 | 17,920 | 8,174 | 20,967 | 12,359 | -35,600 | 76,636 | 5,900 | 65,984 |
Net income (loss) from continuing operations, net of tax | 16,009 | 10,574 | 9,870 | 8,597 | 7,652 | 11,300 | 6,579 | -41,749 | 45,050 | -16,218 | 30,997 |
Net income (loss) from discontinued operations, net of tax | 5,152 | -5,558 | -2,616 | 810 | 235 | -1,225 | -1,184 | 282 | -2,212 | -1,892 | 13,299 |
Net income (loss) | 21,161 | 5,016 | 7,254 | 9,407 | 7,887 | 10,075 | 5,395 | -41,467 | 42,838 | -18,110 | 44,296 |
Basic: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.83 | $0.55 | $0.52 | $0.46 | $0.42 | $0.61 | $0.36 | ($2.33) | $2.37 | ($0.89) | $1.76 |
Net income (loss) from discontinued operations, net of tax | $0.27 | ($0.29) | ($0.14) | $0.04 | $0.01 | ($0.07) | ($0.07) | $0.02 | ($0.12) | ($0.10) | $0.76 |
Net income (loss) | $1.10 | $0.26 | $0.38 | $0.50 | $0.43 | $0.54 | $0.29 | ($2.31) | $2.25 | ($0.99) | $2.52 |
Diluted: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.81 | $0.54 | $0.51 | $0.45 | $0.41 | $0.60 | $0.35 | ($2.33) | $2.32 | ($0.89) | $1.73 |
Net income (loss) from discontinued operations, net of tax | $0.26 | ($0.29) | ($0.14) | $0.04 | $0.01 | ($0.06) | ($0.06) | $0.02 | ($0.11) | ($0.10) | $0.74 |
Net income (loss) | $1.07 | $0.25 | $0.37 | $0.49 | $0.42 | $0.54 | $0.29 | ($2.31) | $2.21 | ($0.99) | $2.47 |
Previously Reported [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interim Reporting [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | 112,035 | 114,752 | 119,492 | 116,041 | 123,085 | 117,306 | 116,670 | 113,060 | 462,320 | 470,121 | 460,629 |
Cost of sales | 18,504 | 22,373 | 23,676 | 21,939 | 23,239 | 23,854 | 23,186 | 22,340 | 86,492 | 92,619 | 90,461 |
Gross profit | 93,531 | 92,379 | 95,816 | 94,102 | 99,846 | 93,452 | 93,484 | 90,720 | 375,828 | 377,502 | 370,168 |
Operating expense | 69,050 | 70,846 | 75,251 | 71,671 | 84,035 | 69,853 | 74,088 | 118,217 | 286,818 | 346,193 | 303,918 |
Operating income (loss) | 24,481 | 21,533 | 20,565 | 22,431 | 15,811 | 23,599 | 19,396 | -27,497 | 89,010 | 31,309 | 66,250 |
Net income (loss) from continuing operations, net of tax | 14,636 | 13,118 | 13,967 | 12,215 | 11,530 | 12,951 | 10,519 | -36,740 | 53,936 | -1,740 | 27,758 |
Net income (loss) from discontinued operations, net of tax | 5,878 | -5,558 | -2,762 | -199 | 862 | -573 | -561 | 939 | -2,641 | 667 | 16,450 |
Net income (loss) | 20,514 | 7,560 | 11,205 | 12,016 | 12,392 | 12,378 | 9,958 | -35,801 | 51,295 | -1,073 | ' |
Basic: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.76 | $0.69 | $0.74 | $0.65 | $0.62 | $0.70 | $0.58 | ($2.05) | $2.84 | ($0.10) | $1.58 |
Net income (loss) from discontinued operations, net of tax | $0.30 | ($0.29) | ($0.15) | ($0.01) | $0.05 | ($0.03) | ($0.03) | $0.05 | ($0.14) | $0.04 | $0.93 |
Net income (loss) | $1.06 | $0.40 | $0.59 | $0.64 | $0.67 | $0.67 | $0.55 | ($2) | $2.70 | ($0.06) | $2.51 |
Diluted: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.74 | $0.67 | $0.73 | $0.64 | $0.62 | $0.69 | $0.57 | ($2.05) | $2.78 | ($0.10) | $1.55 |
Net income (loss) from discontinued operations, net of tax | $0.30 | ($0.28) | ($0.15) | ($0.01) | $0.04 | ($0.03) | ($0.03) | $0.05 | ($0.14) | $0.04 | $0.92 |
Net income (loss) | $1.04 | $0.39 | $0.58 | $0.63 | $0.66 | $0.66 | $0.54 | ($2) | $2.64 | ($0.06) | $2.47 |
Adjustments [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interim Reporting [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | 5,330 | -6,895 | -6,069 | -7,105 | -4,446 | -5,796 | -8,454 | -9,454 | -14,739 | -28,150 | 1,942 |
Cost of sales | 6,440 | 2,011 | 3,871 | -561 | 4,061 | -728 | -431 | 6 | 11,761 | 2,908 | 6,632 |
Gross profit | -1,110 | -8,906 | -9,940 | -6,544 | -8,507 | -5,068 | -8,023 | -9,460 | -26,500 | -31,058 | -4,690 |
Operating expense | -2,242 | -6,178 | -3,673 | -2,033 | -870 | -2,436 | -986 | -1,357 | -14,126 | -5,649 | -4,424 |
Operating income (loss) | 1,132 | -2,728 | -6,267 | -4,511 | -7,637 | -2,632 | -7,037 | -8,103 | -12,374 | -25,409 | -266 |
Net income (loss) from continuing operations, net of tax | 1,373 | -2,544 | -4,097 | -3,618 | -3,878 | -1,651 | -3,940 | -5,009 | -8,886 | -14,478 | 3,239 |
Net income (loss) from discontinued operations, net of tax | -726 | ' | 146 | 1,009 | -627 | -652 | -623 | -657 | 429 | -2,559 | -3,151 |
Net income (loss) | $647 | ($2,544) | ($3,951) | ($2,609) | ($4,505) | ($2,303) | ($4,563) | ($5,666) | ($8,457) | ($17,037) | ' |
Basic: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.07 | ($0.14) | ($0.22) | ($0.19) | ($0.20) | ($0.09) | ($0.22) | ($0.28) | ($0.47) | ($0.79) | $0.18 |
Net income (loss) from discontinued operations, net of tax | ($0.03) | ' | $0.01 | $0.05 | ($0.04) | ($0.04) | ($0.04) | ($0.03) | $0.02 | ($0.14) | ($0.17) |
Net income (loss) | $0.04 | ($0.14) | ($0.21) | ($0.14) | ($0.24) | ($0.13) | ($0.26) | ($0.31) | ($0.45) | ($0.93) | $0.01 |
Diluted: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) from continuing operations, net of tax | $0.07 | ($0.13) | ($0.22) | ($0.19) | ($0.21) | ($0.09) | ($0.22) | ($0.28) | ($0.46) | ($0.79) | $0.18 |
Net income (loss) from discontinued operations, net of tax | ($0.04) | ($0.01) | $0.01 | $0.05 | ($0.03) | ($0.03) | ($0.03) | ($0.03) | $0.03 | ($0.14) | ($0.18) |
Net income (loss) | ($0.03) | ($0.14) | ($0.21) | ($0.14) | ($0.24) | ($0.12) | ($0.25) | ($0.31) | ($0.43) | ($0.93) | ' |
Quarterly_financial_data_Addit
Quarterly financial data - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 |
Interim Period, Costs Not Allocable [Line Items] | ' | ' | ' | ' |
Charges related to US Government resolutions | $10,500 | $46,000 | ($1,260) | $9,520 |
Previously Reported [Member] | ' | ' | ' | ' |
Interim Period, Costs Not Allocable [Line Items] | ' | ' | ' | ' |
Charges related to US Government resolutions | 10,500 | 46,000 | ' | ' |
Adjustments [Member] | ' | ' | ' | ' |
Interim Period, Costs Not Allocable [Line Items] | ' | ' | ' | ' |
Charges related to US Government resolutions | $10,500 | $46,000 | ' | ' |
Quarterly_financial_data_Conde1
Quarterly financial data - Condensed Consolidated Balance Sheets (Detail) (USD $) | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 |
In Thousands, unless otherwise specified | ||||||||
Interim Reporting [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Total assets | $472,897 | $539,566 | $530,395 | $694,106 | $685,380 | $639,868 | $632,860 | $618,938 |
Total liabilities | 105,065 | 193,599 | 205,196 | 381,734 | 393,306 | 347,777 | 352,884 | 354,949 |
Total shareholders' equity | 367,832 | 345,967 | 325,199 | 312,372 | 292,074 | 292,091 | 279,976 | 263,989 |
Total liabilities and shareholders' equity | 472,897 | 539,566 | 530,395 | 694,106 | 685,380 | 639,868 | 632,860 | 618,938 |
Previously Reported [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Interim Reporting [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Total assets | 504,281 | 565,073 | 553,320 | 707,586 | 704,472 | 656,073 | 647,026 | 631,284 |
Total liabilities | 105,183 | 187,463 | 199,104 | 369,178 | 389,301 | 345,130 | 349,116 | 354,201 |
Total shareholders' equity | 399,098 | 377,610 | 354,216 | 338,408 | 315,171 | 310,943 | 297,910 | 277,083 |
Total liabilities and shareholders' equity | 504,281 | 565,073 | 553,320 | 707,586 | 704,472 | 656,073 | 647,026 | 631,284 |
Adjustments [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Interim Reporting [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Total assets | -31,384 | -25,507 | -22,925 | -13,480 | -19,092 | -16,205 | -14,166 | -12,346 |
Total liabilities | -118 | 6,136 | 6,092 | 12,556 | 4,005 | 2,647 | 3,768 | 748 |
Total shareholders' equity | -31,266 | -31,643 | -29,017 | -26,036 | -23,097 | -18,852 | -17,934 | -13,094 |
Total liabilities and shareholders' equity | ($31,384) | ($25,507) | ($22,925) | ($13,480) | ($19,092) | ($16,205) | ($14,166) | ($12,346) |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (Subsequent Event [Member], USD $) | 0 Months Ended | |
In Millions, unless otherwise specified | Mar. 24, 2014 | 8-May-13 |
Subsequent Event [Member] | ' | ' |
Subsequent Event [Line Items] | ' | ' |
Share repurchase program, authorized amount | ' | $50 |
Stock repurchased amount | $39.50 | ' |
Schedule_1_Condensed_Financial
Schedule 1- Condensed Financial Information of Registrant Orthofix International N.V. - Condensed Balance Sheets (unaudited) (Detail) (USD $) | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 |
In Thousands, unless otherwise specified | ||||||||||
Current assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | $31,055 | ' | ' | ' | $33,207 | ' | ' | ' | $13,561 | $13,328 |
Prepaid expenses and other current assets | 34,079 | ' | ' | ' | 21,999 | ' | ' | ' | ' | ' |
Total current assets | 310,583 | ' | ' | ' | 531,133 | ' | ' | ' | ' | ' |
Other long term assets | 7,920 | ' | ' | ' | 9,429 | ' | ' | ' | ' | ' |
Total assets | 472,897 | 539,566 | 530,395 | 694,106 | 685,380 | 639,868 | 632,860 | 618,938 | ' | ' |
Liabilities and shareholder's equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current liabilities | 62,185 | ' | ' | ' | 183,699 | ' | ' | ' | ' | ' |
Shareholder's equity: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock | 1,934 | ' | ' | ' | 1,846 | ' | ' | ' | ' | ' |
Additional paid in capital | 246,306 | ' | ' | ' | 214,505 | ' | ' | ' | ' | ' |
Accumulated earnings | 114,847 | ' | ' | ' | 72,009 | ' | ' | ' | ' | ' |
Accumulated other comprehensive income | 4,745 | ' | ' | ' | 3,714 | ' | ' | ' | ' | ' |
Total shareholders' equity | 367,832 | 345,967 | 325,199 | 312,372 | 292,074 | 292,091 | 279,976 | 263,989 | ' | ' |
Total liabilities and shareholder's equity | 472,897 | 539,566 | 530,395 | 694,106 | 685,380 | 639,868 | 632,860 | 618,938 | ' | ' |
Orthofix International N V [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | 7,392 | ' | ' | ' | 19,433 | ' | ' | ' | 2,882 | 403 |
Prepaid expenses and other current assets | 534 | ' | ' | ' | 487 | ' | ' | ' | ' | ' |
Total current assets | 7,926 | ' | ' | ' | 19,920 | ' | ' | ' | ' | ' |
Other long term assets | 15 | ' | ' | ' | 61 | ' | ' | ' | ' | ' |
Investments in and amounts due from subsidiaries and affiliates | 369,204 | ' | ' | ' | 284,105 | ' | ' | ' | ' | ' |
Total assets | 377,145 | ' | ' | ' | 304,086 | ' | ' | ' | ' | ' |
Liabilities and shareholder's equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current liabilities | 1,202 | ' | ' | ' | 3,900 | ' | ' | ' | ' | ' |
Long-term liabilities | 8,111 | ' | ' | ' | 8,111 | ' | ' | ' | ' | ' |
Shareholder's equity: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock | 1,934 | ' | ' | ' | 1,846 | ' | ' | ' | ' | ' |
Additional paid in capital | 246,306 | ' | ' | ' | 214,505 | ' | ' | ' | ' | ' |
Accumulated earnings | 114,847 | ' | ' | ' | 72,009 | ' | ' | ' | ' | ' |
Accumulated other comprehensive income | 4,745 | ' | ' | ' | 3,715 | ' | ' | ' | ' | ' |
Total shareholders' equity | 367,832 | ' | ' | ' | 292,075 | ' | ' | ' | ' | ' |
Total liabilities and shareholder's equity | $377,145 | ' | ' | ' | $304,086 | ' | ' | ' | ' | ' |
Schedule_1_Condensed_Financial1
Schedule 1 - Condensed Financial Information of Registrant Orthofix International NV - Condensed Statements of Operations (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
(Expenses) income: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | ($53,391) | ($64,481) | ($73,010) |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 70,188 | -2,053 | 55,028 |
Income tax (expense) benefit | ' | ' | ' | ' | ' | ' | ' | ' | -25,138 | -14,165 | -24,031 |
Net income (loss) | 21,161 | 5,016 | 7,254 | 9,407 | 7,887 | 10,075 | 5,395 | -41,467 | 42,838 | -18,110 | 44,296 |
Orthofix International N V [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
(Expenses) income: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
General and administrative | ' | ' | ' | ' | ' | ' | ' | ' | -7,700 | -11,134 | -13,146 |
Equity in earnings of investments in subsidiaries and affiliates | ' | ' | ' | ' | ' | ' | ' | ' | 50,317 | -6,296 | 59,517 |
Other, net | ' | ' | ' | ' | ' | ' | ' | ' | 24 | 7 | -199 |
Income (loss) before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 42,641 | -17,423 | 46,172 |
Income tax (expense) benefit | ' | ' | ' | ' | ' | ' | ' | ' | 197 | -687 | -1,876 |
Net income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | $42,838 | ($18,110) | $44,296 |
Schedule_1_Condensed_Financial2
Schedule 1 - Condensed Financial Information of Registrant Orthofix International NV - Condensed Statement of Cash Flows (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | $42,838 | ($18,110) | $44,296 |
Cash flows from investing activities: | ' | ' | ' |
Capital expenditures | -27,994 | -24,965 | -25,844 |
Cash flows from financing activities: | ' | ' | ' |
Net proceeds from issuance of common stock | 25,586 | 20,113 | 7,854 |
Contributions to subsidiaries and affiliates | ' | -517 | ' |
Tax benefit on exercise of stock options | 1,020 | 1,737 | 2,417 |
Cash and cash equivalents at the beginning of the year | 33,207 | 13,561 | 13,328 |
Cash and cash equivalents at the end of the year | 31,055 | 33,207 | 13,561 |
Orthofix International N V [Member] | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | 42,838 | -18,110 | 44,296 |
Equity in earnings of investments in subsidiaries and affiliates | -50,317 | 6,296 | -59,517 |
Cash used in other operating activities | -6,811 | 3,429 | 7,111 |
Net cash used in operating activities | -14,290 | -8,385 | -8,110 |
Cash flows from investing activities: | ' | ' | ' |
Distributions and amounts received from subsidiaries | 12,564 | 5,875 | 21,597 |
Capital expenditures | ' | ' | -5 |
Net cash provided by investing activities | 12,564 | 5,875 | 21,592 |
Cash flows from financing activities: | ' | ' | ' |
Net proceeds from issuance of common stock | 25,586 | 20,113 | 7,854 |
Contributions to subsidiaries and affiliates | -36,921 | -2,789 | -21,274 |
Tax benefit on exercise of stock options | 1,020 | 1,737 | 2,417 |
Net cash provided by (used in) financing activities | -10,315 | 19,061 | -11,003 |
Net increase (decrease) in cash and cash equivalents | -12,041 | 16,551 | 2,479 |
Cash and cash equivalents at the beginning of the year | 19,433 | 2,882 | 403 |
Cash and cash equivalents at the end of the year | $7,392 | $19,433 | $2,882 |
Schedule_1_Condensed_Financial3
Schedule 1 - Condensed Financial Information of Registrant Orthofix International NV - Additional information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Restricted net assets of subsidiary of the reporting entity | $213.40 | $162.70 | ' |
Orthofix Inc [Member] | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Percent of restricted net assets of a Subsidiary to consolidated net assets of the company where condensed parent company financial statement are required | 25.00% | ' | ' |
Restricted net assets of subsidiary of the reporting entity | 213.4 | 162.7 | ' |
Cash dividends received from consolidated subsidiaries | $0 | $5.90 | $21.60 |
Schedule_2_Valuation_and_Quali
Schedule 2 - Valuation and Qualifying Accounts (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Allowance for doubtful accounts receivable [Member] | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance at beginning of year | $9,341 | $6,542 | $6,584 |
Addition Charged to cost and expenses | 10,387 | 12,879 | 8,627 |
Addition Charged (credited) to other accounts | -13 | -501 | -4 |
Deductions/ Other | -6,172 | -9,579 | -8,665 |
Balance at end of year | 13,543 | 9,341 | 6,542 |
Deferred tax valuation allowance [Member] | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance at beginning of year | 19,124 | 21,023 | 17,239 |
Addition Charged to cost and expenses | 7,237 | -1,899 | 3,784 |
Addition Charged (credited) to other accounts | ' | ' | ' |
Deductions/ Other | ' | ' | ' |
Balance at end of year | $26,361 | $19,124 | $21,023 |