Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Sep. 30, 2020 | Oct. 26, 2020 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-15317 | |
Entity Registrant Name | ResMed Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 98-0152841 | |
Entity Address, Address Line One | 9001 Spectrum Center Blvd. | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92123 | |
Entity Address, Country | US | |
City Area Code | 858 | |
Local Phone Number | 836-5000 | |
Title of 12(b) Security | Common Stock, par value $0.004 per share | |
Trading Symbol | RMD | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 144,915,153 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --06-30 | |
Entity Central Index Key | 0000943819 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 421,414 | $ 463,156 |
Accounts receivable, net of allowances of $29,869 and $28,508 at September 30, 2020 and June 30, 2020, respectively | 464,892 | 474,643 |
Inventories (note 3) | 478,006 | 416,915 |
Prepaid expenses and other current assets | 178,297 | 168,745 |
Total current assets | 1,542,609 | 1,523,459 |
Non-current assets: | ||
Property, plant and equipment, net (note 3) | 424,819 | 417,335 |
Operating lease right-of-use assets | 124,473 | 118,348 |
Goodwill (note 4) | 1,899,743 | 1,890,324 |
Other intangible assets, net (note 3) | 432,894 | 448,168 |
Deferred income taxes | 50,788 | 41,065 |
Prepaid taxes and other non-current assets | 145,518 | 148,677 |
Total non-current assets | 3,078,235 | 3,063,917 |
Total assets | 4,620,844 | 4,587,376 |
Current liabilities: | ||
Accounts payable | 117,589 | 135,786 |
Accrued expenses | 269,859 | 270,353 |
Operating lease liabilities, current | 21,329 | 21,263 |
Deferred revenue | 102,035 | 98,617 |
Income taxes payable (note 6) | 68,053 | 64,755 |
Short-term debt, net (note 8) | 11,988 | 11,987 |
Total current liabilities | 590,853 | 602,761 |
Non-current liabilities: | ||
Deferred revenue | 83,887 | 87,307 |
Deferred income taxes | 13,007 | 13,011 |
Operating lease liabilities, non-current | 111,183 | 101,880 |
Other long-term liabilities | 8,568 | 8,347 |
Long-term debt, net (note 8) | 1,044,435 | 1,164,133 |
Long-term income taxes payable (note 6) | 90,051 | 112,910 |
Total non-current liabilities | 1,351,131 | 1,487,588 |
Total liabilities | 1,941,984 | 2,090,349 |
Commitments and contingencies (note 10) | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value, 2,000,000 shares authorized; none issued | ||
Common stock, $0.004 par value, 350,000,000 shares authorized; 186,744,426 issued and 144,908,192 outstanding at September 30, 2020 and 186,723,407 issued and 144,887,175 outstanding at June 30, 2020 | 580 | 580 |
Additional paid-in capital | 1,588,018 | 1,570,694 |
Retained earnings | 2,953,709 | 2,832,991 |
Treasury stock, at cost, 41,836,234 shares at September 30, 2020 and June 30, 2020 | (1,623,256) | (1,623,256) |
Accumulated other comprehensive loss | (240,191) | (283,982) |
Total stockholders' equity | 2,678,860 | 2,497,027 |
Total liabilities and stockholders' equity | $ 4,620,844 | $ 4,587,376 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Accounts receivable, net allowance for doubtful accounts | $ 29,869 | $ 28,508 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.004 | $ 0.004 |
Common stock, shares authorized | 350,000,000 | 350,000,000 |
Common stock, shares issued | 186,744,426 | 186,723,407 |
Common stock, shares outstanding | 144,908,192 | 144,887,175 |
Treasury stock, shares held | 41,836,234 | 41,836,234 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Net revenue | $ 751,944 | $ 681,056 |
Cost of sales (exclusive of amortization shown separately below) | 301,304 | 276,001 |
Amortization of acquired intangible assets | 11,979 | 13,436 |
Total cost of sales | 313,283 | 289,437 |
Gross profit | 438,661 | 391,619 |
Operating expenses: | ||
Selling, general and administrative | 158,989 | 167,440 |
Research and development | 54,533 | 48,033 |
Amortization of acquired intangible assets | 8,243 | 5,044 |
Total operating expenses | 221,765 | 220,517 |
Income from operations | 216,896 | 171,102 |
Other income (loss), net: | ||
Interest income | 117 | 449 |
Interest expense | (6,842) | (10,992) |
Loss attributable to equity method investments (note 5) | (2,288) | (6,863) |
Other, net (note 13) | 7,971 | (3,109) |
Total other income (loss), net | (1,042) | (20,515) |
Income before income taxes | 215,854 | 150,587 |
Income taxes | 37,482 | 30,439 |
Net income | $ 178,372 | $ 120,148 |
Basic earnings per share (note 9) | $ 1.23 | $ 0.84 |
Diluted earnings per share (note 9) | 1.22 | 0.83 |
Dividend declared per share | $ 0.39 | $ 0.39 |
Basic shares outstanding (000's) | 144,900 | 143,719 |
Diluted shares outstanding (000's) | 146,100 | 145,099 |
Sleep And Respiratory Care [Member] | ||
Net revenue | $ 659,801 | $ 594,201 |
Cost of sales (exclusive of amortization shown separately below) | 268,990 | 246,416 |
Operating expenses: | ||
Amortization of acquired intangible assets | 1,955 | 2,251 |
Software As A Service [Member] | ||
Net revenue | 92,143 | 86,855 |
Cost of sales (exclusive of amortization shown separately below) | 32,314 | 29,585 |
Operating expenses: | ||
Amortization of acquired intangible assets | $ 10,024 | $ 11,185 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Condensed Consolidated Statements Of Comprehensive Income [Abstract] | ||
Net income | $ 178,372 | $ 120,148 |
Other comprehensive income (loss): | ||
Foreign currency translation (loss) gain adjustments | 43,791 | (37,576) |
Comprehensive income | $ 222,163 | $ 82,572 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements Of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member]Cumulative Effect Of Change In Accounting Standards [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Cumulative Effect Of Change In Accounting Standards [Member] | Total |
Beginning balance at Jun. 30, 2019 | $ 575 | $ 1,511,473 | $ (1,623,256) | $ 2,436,410 | $ (253,009) | $ 2,072,193 | ||
Beginning balance, shares at Jun. 30, 2019 | 185,491 | (41,836) | ||||||
Common stock issued on exercise of options (note 11) | 5,609 | 5,609 | ||||||
Common stock issued on exercise of options (note 11), shares | 110 | |||||||
Common stock issued on vesting of restricted stock units, net of shares withheld for tax (note 11) | (327) | (327) | ||||||
Common stock issued on vesting of restricted stock units, net of shares withheld for tax (note 11), shares | 4 | |||||||
Stock-based compensation costs | 13,256 | 13,256 | ||||||
Other comprehensive income | (37,576) | (37,576) | ||||||
Net income | 120,148 | 120,148 | ||||||
Dividends declared | (56,052) | (56,052) | ||||||
Ending balance at Sep. 30, 2019 | $ 575 | 1,530,011 | $ (1,623,256) | 2,500,506 | (290,585) | 2,117,251 | ||
Ending balance, shares at Sep. 30, 2019 | 185,605 | (41,836) | ||||||
Beginning balance at Jun. 30, 2020 | $ 580 | 1,570,694 | $ (1,623,256) | 2,832,991 | (283,982) | 2,497,027 | ||
Beginning balance, shares at Jun. 30, 2020 | 186,723 | 41,836 | ||||||
Common stock issued on exercise of options (note 11) | 1,026 | 1,026 | ||||||
Common stock issued on exercise of options (note 11), shares | 18 | |||||||
Common stock issued on vesting of restricted stock units, net of shares withheld for tax (note 11) | 227 | 227 | ||||||
Common stock issued on vesting of restricted stock units, net of shares withheld for tax (note 11), shares | 3 | |||||||
Stock-based compensation costs | 16,071 | 16,071 | ||||||
Other comprehensive income | 43,791 | 43,791 | ||||||
Net income | 178,372 | 178,372 | ||||||
Dividends declared | (56,511) | (56,511) | ||||||
Ending balance at Sep. 30, 2020 | $ 580 | $ 1,588,018 | $ (1,623,256) | $ (1,143) | $ 2,953,709 | $ (240,191) | $ (1,143) | $ 2,678,860 |
Ending balance, shares at Sep. 30, 2020 | 186,744 | 41,836 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | ||
Net income | $ 178,372 | $ 120,148 |
Adjustment to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 39,466 | 37,954 |
Amortization of right-of-use-assets | 10,422 | 5,963 |
Stock-based compensation costs | 16,071 | 13,256 |
Loss attributable to equity method investments (note 5) | 2,288 | 6,863 |
(Gain) loss on equity investments (note 5) | (8,476) | 2,590 |
Changes in fair value of business combination contingent consideration | (8) | |
Changes in operating assets and liabilities: | ||
Accounts receivable | 16,110 | 28,286 |
Inventories | (52,396) | (14,204) |
Prepaid expenses, net deferred income taxes and other current assets | 3,415 | (8,407) |
Accounts payable, accrued expenses and other | (61,273) | (30,078) |
Net cash provided by operating activities | 143,999 | 162,363 |
Cash flows from investing activities: | ||
Purchases of property, plant and equipment | (13,501) | (22,671) |
Patent registration costs | (5,237) | (2,069) |
Purchases of investments (note 5) | (8,196) | (2,741) |
Payments on maturity of foreign currency contracts | 4,824 | (5,743) |
Net cash used in investing activities | (22,110) | (33,224) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock, net | 1,026 | 5,609 |
Taxes paid related to net share settlement of equity awards | 227 | (326) |
Payments of business combination contingent consideration | (302) | |
Proceeds from borrowings, net of borrowing costs | 55,000 | 565,000 |
Repayment of borrowings | (175,000) | (614,003) |
Dividends paid | (56,511) | (56,052) |
Net cash used in financing activities | (175,258) | (100,074) |
Effect of exchange rate changes on cash | 11,627 | (4,039) |
Net increaase (decrease) in cash and cash equivalents | (41,742) | 25,026 |
Cash and cash equivalents at beginning of period | 463,156 | 147,128 |
Cash and cash equivalents at end of period | 421,414 | 172,154 |
Supplemental disclosure of cash flow information: | ||
Income taxes paid, net of refunds | 51,370 | 30,937 |
Interest paid | $ (6,842) | $ (10,992) |
Summary Of Significant Accounti
Summary Of Significant Accounting Policies | 3 Months Ended |
Sep. 30, 2020 | |
Summary Of Significant Accounting Policies [Abstract] | |
Summary Of Significant Accounting Policies | (1) Summary of Significant Accounting Policies Organization and Basis of Presentation ResMed Inc. (referred to herein as “we”, “us”, “our” or the “Company”) is a Delaware corporation formed in March 1994 as a holding company for the ResMed Group. Through our subsidiaries, we design, manufacture and market equipment for the diagnosis and treatment of sleep-disordered breathing and other respiratory disorders, including obstructive sleep apnea. Our manufacturing operations are located in Australia, Singapore, Malaysia, France, China and the United States. Major distribution and sales sites are located in the United States, Germany, France, the United Kingdom, Switzerland, Australia, Japan, China, Finland, Norway and Sweden. We also operate a Software as a Service (“SaaS”) business in the United States that includes out-of-hospital software platforms designed to support the professionals and caregivers who help people stay healthy in the home or care setting of their choice. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and the rules of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all necessary adjustments, which consisted only of normal recurring items, have been included in the accompanying financial statements to present fairly the results of the interim periods. The results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for the year ending June 30, 2021. The condensed consolidated financial statements for the three months ended September 30, 2020 and September 30, 2019 are unaudited and should be read in conjunction with the consolidated financial statements and notes thereto included in our Form 10-K for the year ended June 30, 2020. Revenue Recognition In accordance with Accounting Standard Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers”, we account for a contract with a customer when there is a legally enforceable contract, the rights of the parties are identified, the contract has commercial substance, and collectability of the contract consideration is probable. We have determined that we have two operating segments, which are the sleep and respiratory disorders sector of the medical device industry (“Sleep and Respiratory Care”) and the supply of business management software as a service to out-of-hospital health providers (“SaaS”). Our Sleep and Respiratory Care revenue relates primarily to the sale of our products that are therapy-based equipment. Some contracts include additional performance obligations such as the provision of extended warranties and data for patient monitoring. Our SaaS revenue relates to the provision of software access with ongoing support and maintenance services as well as professional services such as training and consulting. Disaggregation of revenue The following table summarizes our net revenue disaggregated by segment, product and region (in thousands): Three Months Ended September 30, 2020 2019 U.S., Canada and Latin America Devices $ 197,393 $ 186,887 Masks and other 205,760 183,441 Total Sleep and Respiratory Care $ 403,153 $ 370,328 Software as a Service 92,143 86,855 Total $ 495,296 $ 457,183 Combined Europe, Asia and other markets Devices $ 176,026 $ 151,925 Masks and other 80,622 71,948 Total Sleep and Respiratory Care $ 256,648 $ 223,873 Global revenue Devices $ 373,419 $ 338,812 Masks and other 286,382 255,389 Total Sleep and Respiratory Care $ 659,801 $ 594,201 Software as a Service 92,143 86,855 Total $ 751,944 $ 681,056 Performance obligations and contract balances Revenue is recognized when performance obligations under the terms of a contract with a customer are satisfied; generally, this occurs with the transfer of risk and/or control of our products are provided at a point in time. For products in our Sleep and Respiratory Care business, we transfer control and recognize a sale when products are shipped to the customer in accordance with the contractual shipping terms. For our SaaS business, revenue associated with professional services are recognized as they are provided. We defer the recognition of a portion of the consideration received when performance obligations are not yet satisfied. Consideration received from customers in advance of revenue recognition is classified as deferred revenue. Performance obligations resulting in deferred revenue in our Sleep and Respiratory Care business relate primarily to extended warranties on our devices and the provision of data for patient monitoring. Performance obligations resulting in deferred revenue in our SaaS business relate primarily to the provision of software access with maintenance and support over an agreed term and material rights associated with future discounts upon renewal of some SaaS contracts. Generally, deferred revenue will be recognized over a period of one year to five years. Our contracts do not contain significant financing components. The following table summarizes our contract balances (in thousands): September 30, 2020 June 30, 2020 Balance sheet caption Contract assets Accounts receivable, net $ 464,892 $ 474,643 Accounts receivable, net Unbilled revenue, current 9,586 9,452 Prepaid expenses and other current assets Unbilled revenue, non-current 6,497 6,957 Prepaid taxes and other non-current assets Contract liabilities Deferred revenue, current ( 102,035 ) ( 98,617 ) Deferred revenue (current liabilities) Deferred revenue, non-current ( 83,887 ) ( 87,307 ) Deferred revenue (non-current liabilities) Transaction price determination Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. In our Sleep and Respiratory Care segment, the amount of consideration received and revenue recognized varies with changes in marketing incentives (e.g., rebates, discounts, free goods) and returns offered to customers and their customers. When we give customers the right to return eligible products and receive credit, returns are estimated based on an analysis of historical experience. However, returns of products, excluding warranty-related returns, are infrequent and insignificant. We adjust the estimate of revenue at the earlier of when the most likely amount of consideration can be estimated, the amount expected to be received changes, or when the consideration becomes fixed. We offer our Sleep and Respiratory Care customers cash or product rebates based on volume or sales targets measured over quarterly or annual periods. We estimate rebates based on each customer’s expected achievement of its targets. In accounting for these rebate programs, we reduce revenue ratably as sales occur over the rebate period by the expected value of the rebates to be returned to the customer. Rebates measured over a quarterly period are updated based on actual sales results and, therefore, no estimation is required to determine the reduction to revenue. For rebates measured over annual periods, we update our estimates on a quarterly basis based on actual sales results and updated forecasts for the remaining rebate periods. We also offer discounts to both our Sleep and Respiratory Care as well as our SaaS customers as part of normal business practice and these are deducted from revenue when the sale occurs. When Sleep and Respiratory Care or SaaS contracts have multiple performance obligations, we generally use an observable price to determine the stand-alone selling price by reference to pricing and discounting practices for the specific product or service when sold separately to similar customers. Revenue is then allocated proportionately, based on the determined stand-alone selling price, to each performance obligation. An allocation is not required for many of our Sleep and Respiratory Care contracts that have a single performance obligation, which is the shipment of our therapy-based equipment. Accounting and practical expedient elections We have elected to account for shipping and handling activities associated with our Sleep and Respiratory Care segment as a fulfillment cost within cost of sales, and record shipping and handling costs collected from customers in net revenue. We have also elected for all taxes assessed by government authorities that are imposed on and concurrent with revenue-producing transactions, such as sales and value added taxes, to be excluded from revenue and presented on a net basis. We have elected two practical expedients including the “right to invoice” practical expedient, which is relevant for some of our SaaS contracts as it allows us to recognize revenue in the amount of the invoice when it corresponds directly with the value of performance completed to date. The second practical expedient adopted permits relief from considering a significant financing component when the payment for the good or service is expected to be one year or less. Lease Revenue We lease sleep and respiratory medical devices to customers primarily as a means to comply with local health insurer requirements in certain foreign geographies. Device rental contracts include sales-type and operating leases, and contract terms vary by customer and include options to terminate or extend the contract. When lease contracts also include the sale of masks and accessories, we allocate contract consideration to those items on a relative standalone price basis and recognize revenue when control transfers to the customer. The components of lease revenue were as follows (in thousands): Three Months Ended September 30, 2020 2019 Sales-type lease revenue $ 1,960 $ 2,258 Operating lease revenue 24,779 21,365 Total lease revenue $ 26,739 $ 23,623 Provision for Warranty We provide for the estimated cost of product warranties on our Sleep and Respiratory Care products at the time the related revenue is recognized. We determine the amount of this provision by using a financial model, which takes into consideration actual historical expenses and potential risks associated with our different products. We use this financial model to calculate the future probable expenses related to warranty and the required level of the warranty provision. Although we engage in product improvement programs and processes, our warranty obligation is affected by product failure rates and costs incurred to correct those product failures. Should actual product failure rates or estimated costs to repair those product failures differ from our estimates, we would be required to revise our estimated warranty provision. New Accounting Pronouncements (a) Recently issued accounting standards not yet adopted ASU No. 2020-04 “Reference Rate Reform: Facilitation of the Effects of Reference Rate Reform on Financial Reporting” In March 2020, the FASB issued ASU No. 2020-04, “Facilitation of the Effects of Reference Rate Reform on Financial Reporting” (Topic 848), which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The guidance is effective for us as of March 12, 2020 through December 31, 2022. We are currently evaluating the impact that this guidance, if elected, will have on our consolidated financial statements. (b) Recently adopted accounting pronouncements ASU No. 2016-13 “Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments” In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, “Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments” (Topic 326), which amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. The guidance was adopted effective July 1, 2020 using the modified retrospective approach. We recognized the cumulative effect of adopting this guidance as an adjustment to the opening balance of retained earnings of $ 1.1 million, net of tax, related to our allowance for credit losses for accounts receivable. The adoption of this ASU did not have a material impact on our condensed consolidated financial statements. ASU No. 2018-15 “Intangibles-Goodwill and Other-Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” In August 2018, the FASB issued ASU No. 2018-15, “Intangibles-Goodwill and Other-Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” (Subtopic 350-40), which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The guidance was adopted effective July 1, 2020 and will be applied prospectively. Under the new ASU, capitalized implementation costs are presented as other non-current assets on our consolidated balance sheets and within operating cash flows on our consolidated statements of cash flows. The adoption of this ASU did not have a material impact on our condensed consolidated financial statements. |
Segment Information
Segment Information | 3 Months Ended |
Sep. 30, 2020 | |
Segment Information [Abstract] | |
Segment Information | ( 2) Segment Information We have quantitatively and qualitatively determined that we operate in two operating segments, which are the Sleep and Respiratory Care segment and the SaaS segment. We evaluate the performance of our segments based on net revenues and income from operations. The accounting policies of the segments are the same as those described in note 2 of our consolidated financial statements included in our Form 10-K for the year ended June 30, 2020. Segment net revenues and segment income from operations do not include inter-segment profits and revenue is allocated to a geographic area based on where the products are shipped to or where the services are performed. Certain items are maintained at the corporate level and are not allocated to the segments. The non-allocated items include corporate headquarters costs, stock-based compensation, amortization expense from acquired intangibles, acquisition related expenses, interest income, interest expense and other, net. We neither discretely allocate assets to our operating segments, nor does our Chief Operating Decision Maker evaluate the operating segments using discrete asset information. The table below presents a reconciliation of net revenues and net operating profit by reportable segments (in thousands): Three Months Ended September 30, 2020 2019 Net revenue by segment Total Sleep and Respiratory Care $ 659,801 $ 594,201 Software as a Service 92,143 88,300 Deferred revenue fair value adjustment (1) - ( 1,445 ) Total Software as a Service 92,143 86,855 Total $ 751,944 $ 681,056 Depreciation and amortization by segment Sleep and Respiratory Care $ 13,147 $ 14,691 Software as a Service 971 978 Amortization of acquired intangible assets and corporate costs 25,348 22,285 Total $ 39,466 $ 37,954 Net operating profit by segment (2) Sleep and Respiratory Care (2) $ 248,181 $ 198,159 Software as a Service (2) 23,586 23,797 Total $ 271,767 $ 221,956 Reconciling items Corporate costs $ 34,649 $ 30,929 Amortization of acquired intangible assets 20,222 18,480 Deferred revenue fair value adjustment (1) - 1,445 Interest expense (income), net 6,725 10,543 Loss attributable to equity method investments 2,288 6,863 Other, net ( 7,971 ) 3,109 Income before income taxes $ 215,854 $ 150,587 (1) The deferred revenue fair value adjustment is a purchase price accounting adjustment related to MatrixCare which was acquired on November 13, 2018. (2) During the three months ended September 30, 2020, we recorded $ 2.8 million of impairment for our operating lease right-of-use asset. The impairment related to leases for office space and was recorded within net operating profit. The impairment for the three months ended September 30, 2020 attributable to Sleep and Respiratory Care was $ 1.6 million and $ 1.2 million for SaaS . |
Supplemental Balance Sheet Info
Supplemental Balance Sheet Information | 3 Months Ended |
Sep. 30, 2020 | |
Supplemental Balance Sheet Information [Abstract] | |
Supplemental Balance Sheet Information | (3) Supplemental Balance Sheet Information Components of selected captions in the condensed consolidated balance sheets consisted of the following (in thousands): Inventories September 30, 2020 June 30, 2020 Raw materials $ 146,976 $ 128,096 Work in progress 2,755 2,807 Finished goods 328,275 286,012 Total inventories $ 478,006 $ 416,915 Property, Plant and Equipment September 30, 2020 June 30, 2020 Property, plant and equipment, at cost $ 1,006,540 $ 969,166 Accumulated depreciation and amortization ( 581,721 ) ( 551,831 ) Property, plant and equipment, net $ 424,819 $ 417,335 Other Intangible Assets September 30, 2020 June 30, 2020 Developed/core product technology $ 385,011 $ 382,806 Accumulated amortization ( 211,853 ) ( 197,670 ) Developed/core product technology, net 173,158 185,136 Customer relationships 280,398 279,370 Accumulated amortization ( 87,842 ) ( 80,922 ) Customer relationships, net 192,556 198,448 Other intangibles 188,671 177,091 Accumulated amortization ( 121,491 ) ( 112,507 ) Other intangibles, net 67,180 64,584 Total other intangibles, net $ 432,894 $ 448,168 Intangible assets consist of developed/core product technology, trade names, non-compete agreements, customer relationships, and patents, which we amortize over the estimated useful life of the assets, generally between two years to fifteen years . There are no expected residual values related to these intangible assets. |
Goodwill
Goodwill | 3 Months Ended |
Sep. 30, 2020 | |
Goodwill [Abstract] | |
Goodwill | (4) Goodwill A reconciliation of changes in our goodwill by reportable segment is as follows (in thousands): Three Months Ended September 30, 2020 Sleep and Respiratory Care SaaS Total Balance at the beginning of the period $ 614,448 $ 1,275,876 $ 1,890,324 Foreign currency translation adjustments 9,419 - 9,419 Balance at the end of the period $ 623,867 $ 1,275,876 $ 1,899,743 |
Investments
Investments | 3 Months Ended |
Sep. 30, 2020 | |
Investments [Abstract] | |
Investments | (5) Investments We have a number of equity investments in privately held companies that are unconsolidated entities. The following discusses our investments in marketable equity securities, non-marketable equity securities, gains and losses on marketable and non-marketable equity securities, as well as our equity securities accounted for under the equity method. Our marketable equity securities are publicly traded stocks measured at fair value and classified within Level 1 in the fair value hierarchy because we use quoted prices for identical assets in active markets. Marketable equity securities are recorded in prepaid expenses and other current assets on the condensed consolidated balance sheets. Non-marketable equity securities consist of investments in privately held companies without readily determinable fair values and are recorded in prepaid taxes and other non-current assets on the condensed consolidated balance sheets. Non-marketable equity securities are reported at cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. We estimate the fair value of our non-marketable equity investments using Level 3 inputs to assess whether impairment losses shall be recorded. All gains and losses on marketable and non-marketable equity securities, realized and unrealized, are recognized in other, net on the condensed consolidated statements of income. Equity investments whereby we have significant influence but not control over the investee, and are not the primary beneficiary of the investee’s activities, are accounted for under the equity method. Under this method, we record our share of gains or losses attributable to equity method investments as a component of other, net on the condensed consolidated statements of income. Equity investments by measurement category were as follows (in thousands): Measurement category September 30, 2020 June 30, 2020 Fair value $ 19,045 $ - Measurement alternative 21,410 30,033 Equity method 18,071 14,109 Total $ 58,526 $ 44,142 The following table shows a reconciliation of the changes in all of our non-marketable equity investments (in thousands): Three Months Ended September 30, Non-marketable securities 2020 2019 Balance at the beginning of the period $ 30,033 $ 30,436 Investments 1,946 2,741 Impairment of investments - ( 2,590 ) Reclassification to marketable securities (1) ( 10,569 ) - Carrying value of non-marketable securities $ 21,410 $ 30,587 (1) In September 2020, one of our investments, which was previously accounted for under the measurement alternative, completed its initial public offering which resulted in a change of accounting methodology to fair value and the recognition of an unrealized gain of $ 8.5 million for the three months ended September 30, 2020. Net unrealized gains recognized in the three months ended September 30, 2020 for equity investments held as of September 30, 2020 were $ 8.5 million, which related to gains on publicly traded marketable equity securities. Net unrealized losses recognized in the three months ended September 30, 2019 for equity investments held as of September 30, 2019 were $ 2.6 million, which related to impairments of privately held non-marketable securities. The following table shows a reconciliation of the changes in our equity securities accounted for under the equity method (in thousands): Three Months Ended September 30, Equity method investments 2020 2019 Balance at the beginning of the period $ 14,109 $ 21,667 Investments 6,250 - Loss attributable to equity method investments ( 2,288 ) ( 6,863 ) Carrying value of equity method investments $ 18,071 $ 14,804 |
Income Taxes
Income Taxes | 3 Months Ended |
Sep. 30, 2020 | |
Income Taxes [Abstract] | |
Income Taxes | (6) Income Taxes In accordance with ASC 740 Income Taxes , each interim reporting period is considered integral to the annual period, and tax expense is measured using an estimated annual effective tax rate. An entity is required to record income tax expense each quarter based on its annual effective tax rate estimated for the full fiscal year and use that rate to provide for income taxes on a current year-to-date basis, adjusted for discrete taxable events that occur during the interim period. Our income tax returns are based on calculations and assumptions subject to audit by various tax authorities. In addition, the calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax laws. We regularly assess the potential outcomes of examinations by tax authorities in determining the adequacy of our provision for income taxes. Any final assessment resulting from tax audits may result in material changes to our past or future taxable income, tax payable or deferred tax assets, and may require us to pay penalties and interest that could materially adversely affect our financial results . We are under audit by the ATO in three different cycles: tax years 2009 to 2013, tax years 2014 to 2017 and tax year 2018. We received Notices of Amended Assessments from the ATO for the tax years 2009 to 2013. Based on these assessments, the ATO asserted that we owe $ 151.7 million in additional income tax and $ 38.4 million in accrued interest, of which $ 75.9 million was paid in April 2018 under a payment arrangement with the ATO. In June 2018, we received a notice from the ATO claiming penalties of 50 % of the additional income tax that was assessed, or $ 75.9 million. As of September 30, 2020, we recorded a receivable in prepaid taxes and other non-current assets for the amount paid in April 2018 as we ultimately expect this will be refunded by the ATO. We do not agree with the ATO’s assessments and we continue to believe we are more likely than not to be successful in defending our position. However, if we are not successful, we will not receive a refund of the amount paid in April 2018 and we would be required to pay the remaining additional income tax, accrued interest and penalties, which would be recorded as income tax expense. |
Product Warranties
Product Warranties | 3 Months Ended |
Sep. 30, 2020 | |
Product Warranties [Abstract] | |
Product Warranties | (7) Product Warranties Changes in the liability for warranty costs, which is included in accrued expenses in our condensed consolidated balance sheets, are as follows (in thousands): Three Months Ended September 30, 2020 2019 Balance at the beginning of the period $ 21,132 $ 19,625 Warranty accruals for the period 5,347 2,901 Warranty costs incurred for the period ( 3,428 ) ( 2,792 ) Foreign currency translation adjustments 640 ( 572 ) Balance at the end of the period $ 23,691 $ 19,162 |
Debt
Debt | 3 Months Ended |
Sep. 30, 2020 | |
Debt [Abstract] | |
Debt | (8) Debt Debt consisted of the following (in thousands): September 30, 2020 June 30, 2020 Short-term debt $ 12,000 $ 12,000 Deferred borrowing costs ( 12 ) ( 13 ) Short-term debt, net 11,988 11,987 - Long-term debt $ 1,048,000 $ 1,168,000 Deferred borrowing costs ( 3,565 ) ( 3,867 ) Long-term debt, net $ 1,044,435 $ 1,164,133 Total debt $ 1,056,423 $ 1,176,120 Credit Facility On April 17, 2018, we entered into an amended and restated credit agreement (the “Revolving Credit Agreement”), as borrower, with lenders MUFG Union Bank, N.A., as administrative agent, joint lead arranger, joint book runner, swing line lender and letter of credit issuer, and Westpac Banking Corporation, as syndication agent, joint lead arranger and joint book runner. The Revolving Credit Agreement, among other things, provided a senior unsecured revolving credit facility of $ 800.0 million, with an uncommitted option to increase the revolving credit facility by an additional $ 300.0 million. Additionally, on April 17, 2018, ResMed Limited entered into a Syndicated Facility Agreement (the “Term Credit Agreement”), as borrower, with lenders MUFG Union Bank, N.A., as administrative agent, joint lead arranger and joint book runner, and Westpac Banking Corporation, as syndication agent, joint lead arranger and joint book runner. The Term Credit Agreement, among other things, provides ResMed Limited a senior unsecured term credit facility of $ 200.0 million. On November 5, 2018, we entered into a first amendment to the Revolving Credit Agreement to, among other things, increase the size of our senior unsecured revolving credit facility from $ 800.0 million to $ 1.6 billion, with an uncommitted option to increase the revolving credit facility by an additional $ 300.0 million. Our obligations under the Revolving Credit Agreement are guaranteed by certain of our direct and indirect U.S. subsidiaries, and ResMed Limited’s obligations under the Term Credit Agreement are guaranteed by us and certain of our direct and indirect U.S. subsidiaries. The Revolving Credit Agreement and Term Credit Agreement contain customary covenants, including, in each case, a financial covenant that requires that we maintain a maximum leverage ratio of funded debt to EBITDA (as defined in the Revolving Credit Agreement and Term Credit Agreement, as applicable). The entire principal amounts of the revolving credit facility and term credit facility, and, in each case, any accrued but unpaid interest may be declared immediately due and payable if an event of default occurs, as defined in the Revolving Credit Agreement and the Term Credit Agreement, as applicable. Events of default under the Revolving Credit Agreement and the Term Credit Agreement include, in each case, failure to make payments when due, the occurrence of a default in the performance of any covenants in the respective agreements or related documents, or certain changes of control of us, or the respective guarantors of the obligations borrowed under the Revolving Credit Agreement and Term Credit Agreement. The Revolving Credit Agreement and Term Credit Agreement each terminate on April 17, 2023 , when all unpaid principal and interest under the loans must be repaid. Amounts borrowed under the Term Credit Agreement will also amortize on a semi-annual basis, with a $ 6.0 million principal payment required on each such semi-annual amortization date. The outstanding principal amounts will bear interest at a rate equal to LIBOR plus 0.75 % to 1.50 % (depending on the then-applicable leverage ratio) or the Base Rate (as defined in the Revolving Credit Agreement and the Term Credit Agreement, as applicable) plus 0.0 % to 0.50 % (depending on the then-applicable leverage ratio). At September 30, 2020, the interest rate that was being charged on the outstanding principal amounts was 1.1 %. An applicable commitment fee of 0.100 % to 0.175 % (depending on the then-applicable leverage ratio) applies on the unused portion of the revolving credit facility. As of September 30, 2020, we had $ 1.2 billion available for draw down under the revolving credit facility. We are required to disclose the fair value of financial instruments for which it is practicable to estimate the value, even though these instruments are not recognized at fair value in the consolidated balance sheets. As the Revolving Credit and Term Credit Agreements’ interest rate is calculated as LIBOR plus the spreads described above, its carrying amount is equivalent to its fair value as at September 30, 2020 and June 30, 2020, which was $ 560.0 million and $ 680.0 million, respectively. Quoted market prices in active markets for identical liabilities based inputs (Level 1) were used to estimate fair value. Senior Notes On July 10, 2019, we entered into a Note Purchase Agreement with the purchasers to that agreement, in connection with the issuance and sale of $ 250.0 million principal amount of our 3.24 % senior notes due July 10, 2026 , and $ 250.0 million principal amount of our 3.45 % senior notes due July 10, 2029 (collectively referred to as the “Senior Notes”). Our obligations under the Note Purchase Agreement and the Senior Notes are unconditionally and irrevocably guaranteed by certain of our direct and indirect U.S. subsidiaries, including ResMed Corp., ResMed Motor Technologies Inc., Birdie Inc., Inova Labs, Inc., Brightree LLC, Brightree Home Health & Hospice LLC, Brightree Patient Collections LLC, ResMed Operations Inc., HEALTHCAREfirst Holding Company, HCF Holdco Company, HEALTHCAREfirst, Inc., CareFacts Information Systems, LLC and Lewis Computer Services, LLC, MatrixCare Holdings Inc., MatrixCare, Inc., Reciprocal Labs Corporation and ResMed SaaS Inc., under a Subsidiary Guaranty Agreement dated as of July 10, 2019. The net proceeds from this transaction were used to pay down borrowings on our Revolving Credit Agreement. Under the terms of the Note Purchase Agreement, we agreed to customary covenants including with respect to our corporate existence, transactions with affiliates, and mergers and other extraordinary transactions. We also agreed that, subject to limited exceptions, we will maintain a ratio of consolidated funded debt to consolidated EBITDA of no more than 3.50 to 1.00 as of the last day of any fiscal quarter, and will not at any time permit the amount of all priority secured and unsecured debt of us and our subsidiaries to exceed 10% of our consolidated tangible assets, determined as of the end of our most recently ended fiscal quarter. We are required to disclose the fair value of financial instruments for which it is practicable to estimate the value, even though these instruments are not recognized at fair value in the consolidated balance sheets. As of September 30, 2020, the Senior Notes have a carrying amount of $ 500.0 million, excluding deferred borrowing costs, and an estimated fair value of $ 548.5 million. Quoted market prices in active markets for identical liabilities based inputs (Level 1) were used to estimate fair value. At September 30, 2020, we were in compliance with our debt covenants and there was $ 1,060.0 million outstanding under the Revolving Credit Agreement, Term Credit Agreement and Senior Notes. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | (9) Earnings Per Share Basic earnings per share is computed by dividing the net income available to common stockholders by the weighted average number of shares of common stock outstanding. For purposes of calculating diluted earnings per share, the denominator includes both the weighted average number of shares of common stock outstanding and the number of dilutive common stock equivalents such as stock options and restricted stock units. The weighted average number of outstanding stock options and restricted stock units not included in the computation of diluted earnings per share were 109,475 and 693 for the three months ended September 30, 2020 and September 30, 2019 , respectively, as the effect would have been anti-dilutive. Basic and diluted earnings per share are calculated as follows (in thousands except per share data): Three Months Ended September 30, 2020 2019 Numerator: Net income $ 178,372 $ 120,148 Denominator: Basic weighted-average common shares outstanding 144,900 143,719 Effect of dilutive securities: Stock options and restricted stock units 1,200 1,380 Diluted weighted average shares 146,100 145,099 Basic earnings per share $ 1.23 $ 0.84 Diluted earnings per share $ 1.22 $ 0.83 |
Legal Actions And Contingencies
Legal Actions And Contingencies | 3 Months Ended |
Sep. 30, 2020 | |
Legal Actions And Contingencies [Abstract] | |
Legal Actions And Contingencies | (10 ) Legal Actions and Contingencies Litigation In the normal course of business, we are subject to routine litigation incidental to our business. While the results of this litigation cannot be predicted with certainty, we believe that their final outcome will not, individually or in aggregate, have a material adverse effect on our consolidated financial statements taken as a whole. Taxation Matters As described in note 6 – Income Taxes, we are under audit by the ATO in three different cycles: tax years 2009 to 2013, tax years 2014 to 2017 and tax year 2018. We received Notices of Amended Assessments from the ATO for the tax years 2009 to 2013. Based on these assessments, the ATO asserted that we owe $ 151.7 million in additional income tax and $ 38.4 million in accrued interest, of which $ 75.9 million was paid in April 2018 under a payment arrangement with the ATO. In June 2018, we received a notice from the ATO claiming penalties of 50 % of the additional income tax that was assessed, or $ 75.9 million. As of September 30, 2020, we recorded a receivable in prepaid taxes and other non-current assets for the amount paid in April 2018 as we ultimately expect this will be refunded by the ATO. We do not agree with the ATO’s assessments and we continue to believe we are more likely than not to be successful in defending our position. However, if we are not successful, we will not receive a refund of the amount paid in April 2018 and we would be required to pay the remaining additional income tax, accrued interest and penalties, which would be recorded as income tax expense. Contingent Obligations Under Recourse Provisions We use independent financing institutions to offer some of our customers financing for the purchase of some of our products. Under these arrangements, if the customer qualifies under the financing institutions’ credit criteria and finances the transaction, the customers repay the financing institution on a fixed payment plan. For some of these arrangements, the customer’s receivable balance is with limited recourse whereby we are responsible for repaying the financing company should the customer default. We record a contingent provision, which is estimated based on historical default rates. This is applied to receivables sold with recourse and is recorded in accrued expenses. During the three months ended September 30, 2020 and September 30, 2019, receivables sold with limited recourse were $ 30.6 million and $ 33.7 million, respectively. As of September 30, 2020, the maximum exposure on outstanding receivables sold with recourse and contingent provision were $ 24.5 million and $ 7.3 million, respectively. As of June 30, 2020, the maximum exposure on outstanding receivables sold with recourse and contingent provision were $ 22.8 million and $ 6.6 million, respectively. |
Summary Of Significant Accoun_2
Summary Of Significant Accounting Policies (Policy) | 3 Months Ended |
Sep. 30, 2020 | |
Summary Of Significant Accounting Policies [Abstract] | |
Revenue Recognition | Revenue Recognition In accordance with Accounting Standard Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers”, we account for a contract with a customer when there is a legally enforceable contract, the rights of the parties are identified, the contract has commercial substance, and collectability of the contract consideration is probable. We have determined that we have two operating segments, which are the sleep and respiratory disorders sector of the medical device industry (“Sleep and Respiratory Care”) and the supply of business management software as a service to out-of-hospital health providers (“SaaS”). Our Sleep and Respiratory Care revenue relates primarily to the sale of our products that are therapy-based equipment. Some contracts include additional performance obligations such as the provision of extended warranties and data for patient monitoring. Our SaaS revenue relates to the provision of software access with ongoing support and maintenance services as well as professional services such as training and consulting. Disaggregation of revenue The following table summarizes our net revenue disaggregated by segment, product and region (in thousands): Three Months Ended September 30, 2020 2019 U.S., Canada and Latin America Devices $ 197,393 $ 186,887 Masks and other 205,760 183,441 Total Sleep and Respiratory Care $ 403,153 $ 370,328 Software as a Service 92,143 86,855 Total $ 495,296 $ 457,183 Combined Europe, Asia and other markets Devices $ 176,026 $ 151,925 Masks and other 80,622 71,948 Total Sleep and Respiratory Care $ 256,648 $ 223,873 Global revenue Devices $ 373,419 $ 338,812 Masks and other 286,382 255,389 Total Sleep and Respiratory Care $ 659,801 $ 594,201 Software as a Service 92,143 86,855 Total $ 751,944 $ 681,056 Performance obligations and contract balances Revenue is recognized when performance obligations under the terms of a contract with a customer are satisfied; generally, this occurs with the transfer of risk and/or control of our products are provided at a point in time. For products in our Sleep and Respiratory Care business, we transfer control and recognize a sale when products are shipped to the customer in accordance with the contractual shipping terms. For our SaaS business, revenue associated with professional services are recognized as they are provided. We defer the recognition of a portion of the consideration received when performance obligations are not yet satisfied. Consideration received from customers in advance of revenue recognition is classified as deferred revenue. Performance obligations resulting in deferred revenue in our Sleep and Respiratory Care business relate primarily to extended warranties on our devices and the provision of data for patient monitoring. Performance obligations resulting in deferred revenue in our SaaS business relate primarily to the provision of software access with maintenance and support over an agreed term and material rights associated with future discounts upon renewal of some SaaS contracts. Generally, deferred revenue will be recognized over a period of one year to five years. Our contracts do not contain significant financing components. The following table summarizes our contract balances (in thousands): September 30, 2020 June 30, 2020 Balance sheet caption Contract assets Accounts receivable, net $ 464,892 $ 474,643 Accounts receivable, net Unbilled revenue, current 9,586 9,452 Prepaid expenses and other current assets Unbilled revenue, non-current 6,497 6,957 Prepaid taxes and other non-current assets Contract liabilities Deferred revenue, current ( 102,035 ) ( 98,617 ) Deferred revenue (current liabilities) Deferred revenue, non-current ( 83,887 ) ( 87,307 ) Deferred revenue (non-current liabilities) Transaction price determination Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. In our Sleep and Respiratory Care segment, the amount of consideration received and revenue recognized varies with changes in marketing incentives (e.g., rebates, discounts, free goods) and returns offered to customers and their customers. When we give customers the right to return eligible products and receive credit, returns are estimated based on an analysis of historical experience. However, returns of products, excluding warranty-related returns, are infrequent and insignificant. We adjust the estimate of revenue at the earlier of when the most likely amount of consideration can be estimated, the amount expected to be received changes, or when the consideration becomes fixed. We offer our Sleep and Respiratory Care customers cash or product rebates based on volume or sales targets measured over quarterly or annual periods. We estimate rebates based on each customer’s expected achievement of its targets. In accounting for these rebate programs, we reduce revenue ratably as sales occur over the rebate period by the expected value of the rebates to be returned to the customer. Rebates measured over a quarterly period are updated based on actual sales results and, therefore, no estimation is required to determine the reduction to revenue. For rebates measured over annual periods, we update our estimates on a quarterly basis based on actual sales results and updated forecasts for the remaining rebate periods. We also offer discounts to both our Sleep and Respiratory Care as well as our SaaS customers as part of normal business practice and these are deducted from revenue when the sale occurs. When Sleep and Respiratory Care or SaaS contracts have multiple performance obligations, we generally use an observable price to determine the stand-alone selling price by reference to pricing and discounting practices for the specific product or service when sold separately to similar customers. Revenue is then allocated proportionately, based on the determined stand-alone selling price, to each performance obligation. An allocation is not required for many of our Sleep and Respiratory Care contracts that have a single performance obligation, which is the shipment of our therapy-based equipment. Accounting and practical expedient elections We have elected to account for shipping and handling activities associated with our Sleep and Respiratory Care segment as a fulfillment cost within cost of sales, and record shipping and handling costs collected from customers in net revenue. We have also elected for all taxes assessed by government authorities that are imposed on and concurrent with revenue-producing transactions, such as sales and value added taxes, to be excluded from revenue and presented on a net basis. We have elected two practical expedients including the “right to invoice” practical expedient, which is relevant for some of our SaaS contracts as it allows us to recognize revenue in the amount of the invoice when it corresponds directly with the value of performance completed to date. The second practical expedient adopted permits relief from considering a significant financing component when the payment for the good or service is expected to be one year or less. |
Lease Revenue | Lease Revenue We lease sleep and respiratory medical devices to customers primarily as a means to comply with local health insurer requirements in certain foreign geographies. Device rental contracts include sales-type and operating leases, and contract terms vary by customer and include options to terminate or extend the contract. When lease contracts also include the sale of masks and accessories, we allocate contract consideration to those items on a relative standalone price basis and recognize revenue when control transfers to the customer. The components of lease revenue were as follows (in thousands): Three Months Ended September 30, 2020 2019 Sales-type lease revenue $ 1,960 $ 2,258 Operating lease revenue 24,779 21,365 Total lease revenue $ 26,739 $ 23,623 |
Provision For Warranty | Provision for Warranty We provide for the estimated cost of product warranties on our Sleep and Respiratory Care products at the time the related revenue is recognized. We determine the amount of this provision by using a financial model, which takes into consideration actual historical expenses and potential risks associated with our different products. We use this financial model to calculate the future probable expenses related to warranty and the required level of the warranty provision. Although we engage in product improvement programs and processes, our warranty obligation is affected by product failure rates and costs incurred to correct those product failures. Should actual product failure rates or estimated costs to repair those product failures differ from our estimates, we would be required to revise our estimated warranty provision. |
New Accounting Pronouncements | New Accounting Pronouncements (a) Recently issued accounting standards not yet adopted ASU No. 2020-04 “Reference Rate Reform: Facilitation of the Effects of Reference Rate Reform on Financial Reporting” In March 2020, the FASB issued ASU No. 2020-04, “Facilitation of the Effects of Reference Rate Reform on Financial Reporting” (Topic 848), which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The guidance is effective for us as of March 12, 2020 through December 31, 2022. We are currently evaluating the impact that this guidance, if elected, will have on our consolidated financial statements. (b) Recently adopted accounting pronouncements ASU No. 2016-13 “Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments” In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, “Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments” (Topic 326), which amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. The guidance was adopted effective July 1, 2020 using the modified retrospective approach. We recognized the cumulative effect of adopting this guidance as an adjustment to the opening balance of retained earnings of $ 1.1 million, net of tax, related to our allowance for credit losses for accounts receivable. The adoption of this ASU did not have a material impact on our condensed consolidated financial statements. ASU No. 2018-15 “Intangibles-Goodwill and Other-Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” In August 2018, the FASB issued ASU No. 2018-15, “Intangibles-Goodwill and Other-Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” (Subtopic 350-40), which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The guidance was adopted effective July 1, 2020 and will be applied prospectively. Under the new ASU, capitalized implementation costs are presented as other non-current assets on our consolidated balance sheets and within operating cash flows on our consolidated statements of cash flows. The adoption of this ASU did not have a material impact on our condensed consolidated financial statements. |
Summary Of Significant Accoun_3
Summary Of Significant Accounting Policies (Tables) | 3 Months Ended |
Sep. 30, 2020 | |
Summary Of Significant Accounting Policies [Abstract] | |
Summary Of Net Revenue Disaggregated By Product And Region | Three Months Ended September 30, 2020 2019 U.S., Canada and Latin America Devices $ 197,393 $ 186,887 Masks and other 205,760 183,441 Total Sleep and Respiratory Care $ 403,153 $ 370,328 Software as a Service 92,143 86,855 Total $ 495,296 $ 457,183 Combined Europe, Asia and other markets Devices $ 176,026 $ 151,925 Masks and other 80,622 71,948 Total Sleep and Respiratory Care $ 256,648 $ 223,873 Global revenue Devices $ 373,419 $ 338,812 Masks and other 286,382 255,389 Total Sleep and Respiratory Care $ 659,801 $ 594,201 Software as a Service 92,143 86,855 Total $ 751,944 $ 681,056 |
Summary Of Contract Balances | September 30, 2020 June 30, 2020 Balance sheet caption Contract assets Accounts receivable, net $ 464,892 $ 474,643 Accounts receivable, net Unbilled revenue, current 9,586 9,452 Prepaid expenses and other current assets Unbilled revenue, non-current 6,497 6,957 Prepaid taxes and other non-current assets Contract liabilities Deferred revenue, current ( 102,035 ) ( 98,617 ) Deferred revenue (current liabilities) Deferred revenue, non-current ( 83,887 ) ( 87,307 ) Deferred revenue (non-current liabilities) |
Schedule Of Components Of Lease Revenue | Three Months Ended September 30, 2020 2019 Sales-type lease revenue $ 1,960 $ 2,258 Operating lease revenue 24,779 21,365 Total lease revenue $ 26,739 $ 23,623 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Sep. 30, 2020 | |
Segment Information [Abstract] | |
Summary Of Revenue By Segment And Reconciling Items | Three Months Ended September 30, 2020 2019 Net revenue by segment Total Sleep and Respiratory Care $ 659,801 $ 594,201 Software as a Service 92,143 88,300 Deferred revenue fair value adjustment (1) - ( 1,445 ) Total Software as a Service 92,143 86,855 Total $ 751,944 $ 681,056 Depreciation and amortization by segment Sleep and Respiratory Care $ 13,147 $ 14,691 Software as a Service 971 978 Amortization of acquired intangible assets and corporate costs 25,348 22,285 Total $ 39,466 $ 37,954 Net operating profit by segment (2) Sleep and Respiratory Care (2) $ 248,181 $ 198,159 Software as a Service (2) 23,586 23,797 Total $ 271,767 $ 221,956 Reconciling items Corporate costs $ 34,649 $ 30,929 Amortization of acquired intangible assets 20,222 18,480 Deferred revenue fair value adjustment (1) - 1,445 Interest expense (income), net 6,725 10,543 Loss attributable to equity method investments 2,288 6,863 Other, net ( 7,971 ) 3,109 Income before income taxes $ 215,854 $ 150,587 (1) The deferred revenue fair value adjustment is a purchase price accounting adjustment related to MatrixCare which was acquired on November 13, 2018. (2) During the three months ended September 30, 2020, we recorded $ 2.8 million of impairment for our operating lease right-of-use asset. The impairment related to leases for office space and was recorded within net operating profit. The impairment for the three months ended September 30, 2020 attributable to Sleep and Respiratory Care was $ 1.6 million and $ 1.2 million for SaaS |
Supplemental Balance Sheet In_2
Supplemental Balance Sheet Information (Tables) | 3 Months Ended |
Sep. 30, 2020 | |
Supplemental Balance Sheet Information [Abstract] | |
Schedule Of Inventories | Inventories September 30, 2020 June 30, 2020 Raw materials $ 146,976 $ 128,096 Work in progress 2,755 2,807 Finished goods 328,275 286,012 Total inventories $ 478,006 $ 416,915 |
Components Of Property, Plant And Equipment | Property, Plant and Equipment September 30, 2020 June 30, 2020 Property, plant and equipment, at cost $ 1,006,540 $ 969,166 Accumulated depreciation and amortization ( 581,721 ) ( 551,831 ) Property, plant and equipment, net $ 424,819 $ 417,335 |
Schedule Of Other Intangible Assets, Net | Other Intangible Assets September 30, 2020 June 30, 2020 Developed/core product technology $ 385,011 $ 382,806 Accumulated amortization ( 211,853 ) ( 197,670 ) Developed/core product technology, net 173,158 185,136 Customer relationships 280,398 279,370 Accumulated amortization ( 87,842 ) ( 80,922 ) Customer relationships, net 192,556 198,448 Other intangibles 188,671 177,091 Accumulated amortization ( 121,491 ) ( 112,507 ) Other intangibles, net 67,180 64,584 Total other intangibles, net $ 432,894 $ 448,168 |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Sep. 30, 2020 | |
Goodwill [Abstract] | |
Schedule Of Changes In Carrying Amount Of Goodwill | Three Months Ended September 30, 2020 Sleep and Respiratory Care SaaS Total Balance at the beginning of the period $ 614,448 $ 1,275,876 $ 1,890,324 Foreign currency translation adjustments 9,419 - 9,419 Balance at the end of the period $ 623,867 $ 1,275,876 $ 1,899,743 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Sep. 30, 2020 | |
Investments [Abstract] | |
Schedule Of Investments | Measurement category September 30, 2020 June 30, 2020 Fair value $ 19,045 $ - Measurement alternative 21,410 30,033 Equity method 18,071 14,109 Total $ 58,526 $ 44,142 |
Schedule Of Reconciliation Of Changes In Non-Marketable Equity Investments | Three Months Ended September 30, Non-marketable securities 2020 2019 Balance at the beginning of the period $ 30,033 $ 30,436 Investments 1,946 2,741 Impairment of investments - ( 2,590 ) Reclassification to marketable securities (1) ( 10,569 ) - Carrying value of non-marketable securities $ 21,410 $ 30,587 (1) In September 2020, one of our investments, which was previously accounted for under the measurement alternative, completed its initial public offering which resulted in a change of accounting methodology to fair value and the recognition of an unrealized gain of $ 8.5 million for the three months ended September 30, 2020. |
Schedule Of Reconciliation Of Changes In Investments | Three Months Ended September 30, Equity method investments 2020 2019 Balance at the beginning of the period $ 14,109 $ 21,667 Investments 6,250 - Loss attributable to equity method investments ( 2,288 ) ( 6,863 ) Carrying value of equity method investments $ 18,071 $ 14,804 |
Product Warranties (Tables)
Product Warranties (Tables) | 3 Months Ended |
Sep. 30, 2020 | |
Product Warranties [Abstract] | |
Schedule Of Changes In Liability For Warranty Costs | Three Months Ended September 30, 2020 2019 Balance at the beginning of the period $ 21,132 $ 19,625 Warranty accruals for the period 5,347 2,901 Warranty costs incurred for the period ( 3,428 ) ( 2,792 ) Foreign currency translation adjustments 640 ( 572 ) Balance at the end of the period $ 23,691 $ 19,162 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Sep. 30, 2020 | |
Debt [Abstract] | |
Schedule Of Debt | September 30, 2020 June 30, 2020 Short-term debt $ 12,000 $ 12,000 Deferred borrowing costs ( 12 ) ( 13 ) Short-term debt, net 11,988 11,987 - Long-term debt $ 1,048,000 $ 1,168,000 Deferred borrowing costs ( 3,565 ) ( 3,867 ) Long-term debt, net $ 1,044,435 $ 1,164,133 Total debt $ 1,056,423 $ 1,176,120 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule Of Basic And Diluted Earnings Per Share | Three Months Ended September 30, 2020 2019 Numerator: Net income $ 178,372 $ 120,148 Denominator: Basic weighted-average common shares outstanding 144,900 143,719 Effect of dilutive securities: Stock options and restricted stock units 1,200 1,380 Diluted weighted average shares 146,100 145,099 Basic earnings per share $ 1.23 $ 0.84 Diluted earnings per share $ 1.22 $ 0.83 |
Summary Of Significant Accoun_4
Summary Of Significant Accounting Policies (Narrative) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jul. 01, 2020 | Jun. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2019 |
Summary Of Significant Accounting Policies [Line Items] | |||||
Adjustment to retained earnings | $ 2,678,860 | $ 2,497,027 | $ 2,117,251 | $ 2,072,193 | |
Retained Earnings [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Adjustment to retained earnings | 2,953,709 | $ 2,832,991 | $ 2,500,506 | $ 2,436,410 | |
Cumulative Effect Of Change In Accounting Standards [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Adjustment to retained earnings | (1,143) | ||||
Cumulative Effect Of Change In Accounting Standards [Member] | Retained Earnings [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Adjustment to retained earnings | $ (1,143) | ||||
Cumulative Effect Of Change In Accounting Standards [Member] | Accounting Standards Update 2016-13 [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Adjustment to retained earnings | $ 1,100 |
Summary Of Significant Accoun_5
Summary Of Significant Accounting Policies (Summary Of Net Revenue Disaggregated By Product And Region) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Net revenue | $ 751,944 | $ 681,056 |
Software As A Service [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 92,143 | 86,855 |
U.S., Canada And Latin America [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 495,296 | 457,183 |
U.S., Canada And Latin America [Member] | Devices [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 197,393 | 186,887 |
U.S., Canada And Latin America [Member] | Masks And Other [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 205,760 | 183,441 |
U.S., Canada And Latin America [Member] | Sleep And Respiratory Care [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 403,153 | 370,328 |
U.S., Canada And Latin America [Member] | Software As A Service [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 92,143 | 86,855 |
Combined Europe, Asia And Other Markets [Member] | Devices [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 176,026 | 151,925 |
Combined Europe, Asia And Other Markets [Member] | Masks And Other [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 80,622 | 71,948 |
Combined Europe, Asia And Other Markets [Member] | Sleep And Respiratory Care [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 256,648 | 223,873 |
Global [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 751,944 | 681,056 |
Global [Member] | Devices [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 373,419 | 338,812 |
Global [Member] | Masks And Other [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 286,382 | 255,389 |
Global [Member] | Sleep And Respiratory Care [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | 659,801 | 594,201 |
Global [Member] | Software As A Service [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenue | $ 92,143 | $ 86,855 |
Summary Of Significant Accoun_6
Summary Of Significant Accounting Policies (Summary Of Contract Balances) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 |
Contract assets | ||
Accounts receivable, net | $ 464,892 | $ 474,643 |
Contract liabilities | ||
Deferred revenue, current | (102,035) | (98,617) |
Deferred revenue, non-current | (83,887) | (87,307) |
Accounts Receivable, Net [Member] | ||
Contract assets | ||
Accounts receivable, net | 464,892 | 474,643 |
Prepaid Expenses And Other Current Assets [Member] | ||
Contract assets | ||
Unbilled revenue, current | 9,586 | 9,452 |
Prepaid Taxes And Other Non Current Assets [Member] | ||
Contract assets | ||
Unbilled revenue, non-current | 6,497 | 6,957 |
Deferred Revenue Current Liabilities [Member] | ||
Contract liabilities | ||
Deferred revenue, current | (102,035) | (98,617) |
Deferred Revenue Non-Current Liabilities [Member] | ||
Contract liabilities | ||
Deferred revenue, non-current | $ (83,887) | $ (87,307) |
Summary Of Significant Accoun_7
Summary Of Significant Accounting Policies (Schedule Of Components Of Lease Revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Summary Of Significant Accounting Policies [Abstract] | ||
Sales-type lease revenue | $ 1,960 | $ 2,258 |
Operating lease revenue | 24,779 | 21,365 |
Total lease revenue | $ 26,739 | $ 23,623 |
Segment Information (Summary Of
Segment Information (Summary Of Revenue By Segment And Reconciling Items) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | ||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 751,944 | $ 681,056 | |
Depreciation and amortization | 39,466 | 37,954 | |
Net operating profit by segment | 216,896 | 171,102 | |
Amortization of acquired intangible assets | 8,243 | 5,044 | |
Interest income | (117) | (449) | |
Interest expense (income), net | 6,842 | 10,992 | |
Loss attributable to equity method investments | (2,288) | (6,863) | |
Other, net | 7,971 | (3,109) | |
Income before income taxes | 215,854 | 150,587 | |
Impairment of operating lease right-of-use asset | 2,800 | ||
Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Net operating profit by segment | [1] | 271,767 | 221,956 |
Corporate Costs [Member] | |||
Segment Reporting Information [Line Items] | |||
Amortization of acquired intangible assets | 25,348 | 22,285 | |
Segment Reconciling Items [Member] | |||
Segment Reporting Information [Line Items] | |||
Deferred revenue fair value adjustment | [2] | (1,445) | |
Corporate costs | 34,649 | 30,929 | |
Amortization of acquired intangible assets | 20,222 | 18,480 | |
Deferred revenue fair value adjustment | [2] | 1,445 | |
Interest expense (income), net | (6,725) | (10,543) | |
Loss attributable to equity method investments | 2,288 | 6,863 | |
Other, net | (7,971) | 3,109 | |
Income before income taxes | 215,854 | 150,587 | |
Sleep And Respiratory Care [Member] | |||
Segment Reporting Information [Line Items] | |||
Impairment of operating lease right-of-use asset | 1,600 | ||
Sleep And Respiratory Care [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 659,801 | 594,201 | |
Depreciation and amortization | 13,147 | 14,691 | |
Net operating profit by segment | [1] | 248,181 | 198,159 |
Software As A Service Before Deferred Revenue Adjustment [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 92,143 | 88,300 | |
Software As A Service [Member] | |||
Segment Reporting Information [Line Items] | |||
Impairment of operating lease right-of-use asset | 1,200 | ||
Software As A Service [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Deferred revenue fair value adjustment | [2] | (1,445) | |
Revenue from Contract with Customer, Excluding Assessed Tax | 92,143 | 86,855 | |
Depreciation and amortization | 971 | 978 | |
Net operating profit by segment | [1] | $ 23,586 | 23,797 |
Deferred revenue fair value adjustment | [2] | $ 1,445 | |
[1] | During the three months ended September 30, 2020, we recorded $ 2.8 million of impairment for our operating lease right-of-use asset. The impairment related to leases for office space and was recorded within net operating profit. The impairment for the three months ended September 30, 2020 attributable to Sleep and Respiratory Care was $ 1.6 million and $ 1.2 million for SaaS . | ||
[2] | The deferred revenue fair value adjustment is a purchase price accounting adjustment related to MatrixCare which was acquired on November 13, 2018. |
Supplemental Balance Sheet In_3
Supplemental Balance Sheet Information (Schedule Of Inventories) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 |
Supplemental Balance Sheet Information [Abstract] | ||
Raw materials | $ 146,976 | $ 128,096 |
Work in progress | 2,755 | 2,807 |
Finished goods | 328,275 | 286,012 |
Total inventories | $ 478,006 | $ 416,915 |
Supplemental Balance Sheet In_4
Supplemental Balance Sheet Information (Components Of Property, Plant And Equipment) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 |
Supplemental Balance Sheet Information [Abstract] | ||
Property, plant and equipment, at cost | $ 1,006,540 | $ 969,166 |
Accumulated depreciation and amortization | (581,721) | (551,831) |
Property, plant and equipment, net | $ 424,819 | $ 417,335 |
Supplemental Balance Sheet In_5
Supplemental Balance Sheet Information (Schedule Of Other Intangible Assets, Net) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Jun. 30, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Total other intangibles, net | $ 432,894 | $ 448,168 |
Developed/Core Product Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Other intangibles, gross | 385,011 | 382,806 |
Accumulated amortization | (211,853) | (197,670) |
Total other intangibles, net | 173,158 | 185,136 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Other intangibles, gross | 280,398 | 279,370 |
Accumulated amortization | (87,842) | (80,922) |
Total other intangibles, net | 192,556 | 198,448 |
Other Intangibles [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Other intangibles, gross | 188,671 | 177,091 |
Accumulated amortization | (121,491) | (112,507) |
Total other intangibles, net | $ 67,180 | $ 64,584 |
Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, estimated useful life | 2 years | |
Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, estimated useful life | 15 years |
Goodwill (Schedule Of Changes I
Goodwill (Schedule Of Changes In Carrying Amount Of Goodwill) (Details) $ in Thousands | 3 Months Ended |
Sep. 30, 2020USD ($) | |
Balance at the beginning of the period | $ 1,890,324 |
Foreign currency translation adjustments | 9,419 |
Balance at the end of the period | 1,899,743 |
Sleep And Respiratory Care [Member] | |
Balance at the beginning of the period | 614,448 |
Foreign currency translation adjustments | 9,419 |
Balance at the end of the period | 623,867 |
Saas [Member] | |
Balance at the beginning of the period | 1,275,876 |
Foreign currency translation adjustments | |
Balance at the end of the period | $ 1,275,876 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | |
Investments [Abstract] | |||
Net unrealized gains | $ 8,500 | ||
Aggregate carrying amount of equity investments | 21,410 | $ 30,033 | |
Impairment losses related to equity investments | (8,476) | $ 2,590 | |
Carrying value of equity method investments | $ 18,071 | $ 14,109 |
Investments (Schedule Of Invest
Investments (Schedule Of Investments) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2019 |
Fair value | $ 19,045 | |||
Measurement alternative | 21,410 | $ 30,033 | ||
Equity method | 18,071 | 14,109 | ||
Total | 58,526 | 44,142 | ||
Non-marketable Securities [Member] | ||||
Measurement alternative | $ 21,410 | $ 30,033 | $ 30,587 | $ 30,436 |
Investments (Schedule Of Reconc
Investments (Schedule Of Reconciliation Of Changes In Non-Marketable Equity Investments) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | ||
Non-marketable Securities | |||
Balance at the beginning of the period | $ 30,033 | ||
Impairment of investments | 8,476 | $ (2,590) | |
Carrying value of non-marketable securities | 21,410 | ||
Gain from change of accounting methodology to fair value | 8,500 | ||
Non-marketable Securities [Member] | |||
Non-marketable Securities | |||
Balance at the beginning of the period | 30,033 | 30,436 | |
Investments | 1,946 | 2,741 | |
Impairment of investments | (2,590) | ||
Reclassification to marketable securities | [1] | (10,569) | |
Carrying value of non-marketable securities | $ 21,410 | $ 30,587 | |
[1] | In September 2020, one of our investments, which was previously accounted for under the measurement alternative, completed its initial public offering which resulted in a change of accounting methodology to fair value and the recognition of an unrealized gain of $ 8.5 million for the three months ended September 30, 2020. |
Investments (Schedule Of Reco_2
Investments (Schedule Of Reconciliation Of Changes In Investments) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Equity Method Investments | ||
Balance at the beginning of the period | $ 14,109 | |
Loss attributable to equity method investments | 2,288 | $ 6,863 |
Carrying value of equity method investments | 18,071 | |
Equity Method Investments [Member] | ||
Equity Method Investments | ||
Balance at the beginning of the period | 14,109 | 21,667 |
Investments | 6,250 | |
Loss attributable to equity method investments | (2,288) | (6,863) |
Carrying value of equity method investments | $ 18,071 | $ 14,804 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||||
Jun. 30, 2018 | Apr. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | |
Income Taxes [Line Items] | ||||||
Income taxes payable | $ 68,053 | $ 64,755 | ||||
Income taxes paid | 51,370 | $ 30,937 | ||||
Income tax expense (benefit) | $ 37,482 | $ 30,439 | ||||
Australian Taxation Office [Member] | ||||||
Income Taxes [Line Items] | ||||||
Tax liabilities related to assessments | $ 75,900 | $ 75,900 | $ 151,700 | |||
Interest related to assessments | $ 38,400 | |||||
Percentage of penalties on additional income tax | 50.00% |
Product Warranties (Schedule Of
Product Warranties (Schedule Of Changes In Liability For Warranty Costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Product Warranties [Abstract] | ||
Balance at the beginning of the period | $ 21,132 | $ 19,625 |
Warranty accruals for the period | 5,347 | 2,901 |
Warranty costs incurred for the period | (3,428) | (2,792) |
Foreign currency translation adjustments | 640 | (572) |
Balance at the end of the period | $ 23,691 | $ 19,162 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) - USD ($) | Nov. 05, 2018 | Apr. 17, 2018 | Sep. 30, 2020 | Jun. 30, 2020 |
Debt Instrument [Line Items] | ||||
Debt to consolidated EBITDA ratio | 3.50 | |||
Outstanding debt | $ 1,056,423,000 | $ 1,176,120,000 | ||
Senior notes, carrying amount | 500,000,000 | |||
Outstanding loan balance | 1,044,435,000 | 1,164,133,000 | ||
Revolving Credit Facility And Term Credit Agreement [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, fair value | 560,000,000 | $ 680,000,000 | ||
MUFG Union Bank [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 1,600,000,000 | $ 800,000,000 | ||
Uncommitted option to increase credit facility | $ 300,000,000 | 300,000,000 | ||
MUFG Union Bank [Member] | ResMed Limited [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | 200,000,000 | |||
MUFG Union Bank, N.A. and Westpac Banking Corporation [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 800,000,000 | |||
Available for draw | $ 1,200,000,000 | |||
MUFG Union Bank, N.A. and Westpac Banking Corporation [Member] | Revolving Credit Facility And Term Credit Agreement [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility termination date | Apr. 17, 2023 | |||
Interest rate on outstanding principal amount | 1.10% | |||
MUFG Union Bank, N.A. and Westpac Banking Corporation [Member] | ResMed Limited [Member] | Term Credit Agreement [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal payment | $ 6,000,000 | |||
Minimum [Member] | MUFG Union Bank, N.A. and Westpac Banking Corporation [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Commitment fees percentage rate on unused portion of credit facility | 0.10% | |||
Minimum [Member] | MUFG Union Bank, N.A. and Westpac Banking Corporation [Member] | ResMed Limited [Member] | Term Credit Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility interest rate equal to reference rate plus | 0.75% | |||
Minimum [Member] | MUFG Union Bank, N.A. and Westpac Banking Corporation [Member] | ResMed Limited [Member] | Term Credit Agreement [Member] | Base Rate [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility interest rate equal to reference rate plus | 0.00% | |||
Maximum [Member] | MUFG Union Bank, N.A. and Westpac Banking Corporation [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Commitment fees percentage rate on unused portion of credit facility | 0.175% | |||
Maximum [Member] | MUFG Union Bank, N.A. and Westpac Banking Corporation [Member] | ResMed Limited [Member] | Term Credit Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility interest rate equal to reference rate plus | 1.50% | |||
Maximum [Member] | MUFG Union Bank, N.A. and Westpac Banking Corporation [Member] | ResMed Limited [Member] | Term Credit Agreement [Member] | Base Rate [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility interest rate equal to reference rate plus | 0.50% | |||
Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, fair value | $ 548,500,000 | |||
3.24% Senior Notes Due July 10, 2026 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 250,000,000 | |||
Interest rate | 3.24% | |||
Maturity date | Jul. 10, 2026 | |||
3.45% Senior Notes Due July 10, 2029 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 250,000,000 | |||
Interest rate | 3.45% | |||
Maturity date | Jul. 10, 2029 | |||
Revolving Credit Agreement, Term Credit Agreement, And Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding debt | $ 1,060,000,000 |
Debt (Schedule Of Debt) (Detail
Debt (Schedule Of Debt) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 |
Debt [Abstract] | ||
Short-term debt | $ 12,000 | $ 12,000 |
Deferred borrowing costs | (12) | (13) |
Short-term debt, net | 11,988 | 11,987 |
Long-term debt | 1,048,000 | 1,168,000 |
Deferred borrowing costs | (3,565) | (3,867) |
Long-term debt, net | 1,044,435 | 1,164,133 |
Total debt | $ 1,056,423 | $ 1,176,120 |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) - shares shares in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||
Stock options and restricted stock units not included in the computation of diluted earnings per share | 109,475 | 693 |
Earnings Per Share (Schedule Of
Earnings Per Share (Schedule Of Basic And Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Numerator: | ||
Net income | $ 178,372 | $ 120,148 |
Denominator: | ||
Basic weighted-average common shares outstanding | 144,900 | 143,719 |
Effect of dilutive securities: | ||
Stock options and restricted stock units | 1,200 | 1,380 |
Diluted weighted average shares | 146,100 | 145,099 |
Basic earnings per share | $ 1.23 | $ 0.84 |
Diluted earnings per share | $ 1.22 | $ 0.83 |
Legal Actions And Contingenci_2
Legal Actions And Contingencies (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Apr. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | |
Loss Contingencies [Line Items] | ||||||
Income taxes payable | $ 68,053 | $ 64,755 | ||||
Contingent Obligations Under Recourse Provisions [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Receivables sold with limited recourse | 30,600 | $ 33,700 | ||||
Maximum potential contingent liability | 24,500 | 22,800 | ||||
Contingent provision | $ 7,300 | $ 6,600 | ||||
Australian Taxation Office [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Percentage of penalties on additional income tax | 50.00% | |||||
Tax liabilities related to assessments | $ 75,900 | $ 75,900 | $ 151,700 | |||
Interest related to assessments | $ 38,400 |