Fourth Quarter Revenues of $476.0 million, up 5.7% over prior year
period; up 9.0% on Constant Currency Basis
Fourth Quarter GAAP Diluted EPS of $1.10, up 41.0% over the prior
year period
Fourth Quarter Adjusted Diluted EPS of $1.43, up 5.1% over the
prior year period
Full Year 2014 Revenues of $1.84 billion, up 8.5% over the prior
year period; up 8.8% on a Constant Currency Basis
Full Year 2014 GAAP Diluted EPS of $4.10, up 18.5% over the prior
year period
Full Year 2014 Adjusted Diluted EPS of $5.74, up 14.1% over the
prior year period
2015 Guidance Range for Constant Currency Revenue Growth of 4% to
6%
2015 Guidance Range for Adjusted Diluted EPS of $6.10 to $6.35, up
6.3% to 10.6%, which reflects our expectation of a negative foreign
currency headwind of approximately 14%
WAYNE, Pa.--(BUSINESS WIRE)--Feb. 20, 2015--
Teleflex Incorporated (NYSE: TFX) (the “Company”) today announced
financial results for the fourth quarter and full year ended December
31, 2014.
Fourth quarter 2014 net revenues were $476.0 million, an increase of
5.7% over the prior year period. Excluding the impact of foreign
currency fluctuations, fourth quarter 2014 net revenues increased 9.0%
over the prior year period.
Fourth quarter 2014 GAAP diluted earnings per share from continuing
operations were $1.10, as compared to $0.78 in the prior year period, an
increase of 41.0%. Fourth quarter 2014 adjusted diluted earnings per
share from continuing operations were $1.43, as compared to $1.36 in the
prior year period, an increase of 5.1%.
Full year 2014 net revenues were $1.84 billion, an increase of 8.5% over
the prior year period. Excluding the impact of foreign currency
fluctuations, full year 2014 net revenues increased 8.8% over the prior
year period.
Full year 2014 GAAP diluted earnings per share from continuing
operations were $4.10, as compared to $3.46 in the prior year period, an
increase of 18.5%. Full year 2014 adjusted diluted earnings per share
from continuing operations were $5.74, as compared to $5.03 in the prior
year period, an increase of 14.1%.
“Teleflex’s full year 2014 results demonstrate another successful year
for the Company,” said Benson Smith, Chairman, President and Chief
Executive Officer. “We integrated Vidacare and Mayo Healthcare Pty Ltd.,
delivered constant currency revenue growth near the upper end of our
guidance range, and generated adjusted earnings per share well ahead of
our initial expectations.”
Added Mr. Smith, “During 2015, we expect to continue to produce solid
constant currency revenue growth and significant operating leverage.
While we anticipate that our 2015 results will be negatively impacted by
foreign exchange movements, we are committed to implementing operational
measures to, in part, mitigate the earnings effect.”
FOURTH QUARTER NET REVENUE BY SEGMENT
Vascular North America fourth quarter 2014 net revenues were $68.7
million, an increase of 9.7% compared to the prior year period.
Excluding the impact of foreign currency fluctuations, fourth quarter
2014 net revenues increased 10.2% compared to the prior year period. The
increase in constant currency revenue was largely due to product sales
resulting from our acquisition of Vidacare and higher sales volume of
existing products.
Anesthesia/Respiratory North America fourth quarter 2014 net revenues
were $58.2 million, an increase of 0.4% compared to the prior year
period. Excluding the impact of foreign currency fluctuations, fourth
quarter 2014 net revenues increased 0.7% compared to the prior year
period. The increase in constant currency revenue was largely due to new
product sales, somewhat offset by lower sales volume of existing
products.
Surgical North America fourth quarter 2014 net revenues were $40.8
million, an increase of 8.9% compared to the prior year period.
Excluding the impact of foreign currency fluctuations, fourth quarter
2014 net revenues increased 9.7% compared to the prior year period. The
increase in constant currency revenue was largely due to higher sales
volume of existing products and price increases.
EMEA fourth quarter 2014 net revenues were $146.9 million, an increase
of 1.5% compared to the prior year period. Excluding the impact of
foreign currency fluctuations, fourth quarter 2014 net revenues
increased 8.9% compared to the prior year period. The increase in
constant currency revenue was largely due to higher sales volume of
existing products, Vidacare product sales, new product sales and price
increases.
Asia fourth quarter 2014 net revenues were $63.6 million, an increase of
7.4% compared to the prior year period. Excluding the impact of foreign
currency fluctuations, fourth quarter 2014 net revenues increased 10.9%
compared to the prior year period. The increase in constant currency
revenue was largely due to product sales resulting from the acquisitions
of Mayo Healthcare Pty Ltd., Vidacare and Ultimate Medical, price
increases and new product sales, somewhat offset by lower sales volume
of existing products.
OEM and Development Services (“OEM”) fourth quarter 2014 net revenues
were $35.0 million, an increase of 3.1% compared to the prior year
period. Excluding the impact of foreign currency fluctuations, fourth
quarter 2014 net revenues increased 4.8% compared to the prior year
period. The increase in constant currency revenue was largely due to
higher sales volume of existing products and new product sales, somewhat
offset by lower average selling prices.
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
% Increase/ (Decrease)
|
|
|
|
December 31,
2014
|
|
December 31,
2013
|
|
Constant
Currency
|
|
Foreign
Currency
|
|
|
Total
Change
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
Vascular North America
|
|
$
|
68.7
|
|
$
|
62.6
|
|
10.2%
|
|
(0.5%
|
)
|
|
9.7%
|
|
Anesthesia/Respiratory North America
|
|
|
58.2
|
|
|
57.8
|
|
0.7%
|
|
(0.3%
|
)
|
|
0.4%
|
|
Surgical North America
|
|
|
40.8
|
|
|
37.5
|
|
9.7%
|
|
(0.8%
|
)
|
|
8.9%
|
|
EMEA
|
|
|
146.9
|
|
|
144.9
|
|
8.9%
|
|
(7.4%
|
)
|
|
1.5%
|
|
Asia
|
|
|
63.6
|
|
|
59.1
|
|
10.9%
|
|
(3.5%
|
)
|
|
7.4%
|
|
OEM
|
|
|
35.0
|
|
|
34.1
|
|
4.8%
|
|
(1.7%
|
)
|
|
3.1%
|
|
All Other
|
|
|
62.8
|
|
|
54.5
|
|
16.3%
|
|
(1.1%
|
)
|
|
15.2%
|
|
Total
|
|
$
|
476.0
|
|
$
|
450.5
|
|
9.0%
|
|
(3.3%
|
)
|
|
5.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER FINANCIAL HIGHLIGHTS AND KEY PERFORMANCE METRICS
Depreciation expense and amortization of intangible assets and deferred
financing costs for the full year of 2014 were $127.0 million compared
to $107.9 million for the prior year period.
Cash and cash equivalents at December 31, 2014 were $303.2 million
compared to $432.0 million at December 31, 2013. The decline in cash and
cash equivalents is primarily due to a $235 million repayment of a
portion of the outstanding principal amount of borrowings under the
revolving credit facility, partially offset by cash generated from
operations.
Net accounts receivable at December 31, 2014 were $273.7 million
compared to $295.3 million at December 31, 2013.
Net inventories at December 31, 2014 were $335.6 million compared to
$333.6 million at December 31, 2013.
Net debt obligations at December 31, 2014 were $801.4 million compared
to $902.7 million at December 31, 2013.
2015 OUTLOOK
The Company estimates that revenues for full year 2015 will increase 4%
to 6% on a constant currency basis. On a GAAP basis, revenues are
expected to be flat to down 2% versus the prior year due to the
unfavorable impact of foreign currency.
The Company expects adjusted diluted earnings per share from continuing
operations to be between $6.10 and $6.35 for full year 2015,
representing an increase of 6.3% to 10.6% over the prior year, which
reflects our expectation of a negative foreign currency headwind of
approximately 14%. The Company expects full year 2015 GAAP diluted
earnings per share from continuing operations to be between $4.22 and
$4.37.
FORECASTED 2015 CONSTANT CURRENCY REVENUE GROWTH RECONCILIATION
|
|
|
|
|
|
|
|
|
|
Low
|
|
|
High
|
|
|
|
|
|
|
|
|
Forecasted 2015 GAAP revenue growth
|
|
(2
|
%)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
Estimated impact of foreign currency fluctuations
|
|
6
|
%
|
|
|
6
|
%
|
|
|
|
|
|
|
|
|
Forecasted 2015 constant currency revenue growth
|
|
4
|
%
|
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
FORECASTED 2015 ADJUSTED EARNINGS PER SHARE RECONCILIATION
|
|
|
|
|
|
|
|
|
|
Low
|
|
|
High
|
|
|
|
|
|
|
|
|
Diluted earnings per share attributable to common shareholders
|
|
$4.22
|
|
|
$4.37
|
|
|
|
|
|
|
|
|
Restructuring, impairment charges and special items, net of tax
|
|
$0.75
|
|
|
$0.80
|
|
|
|
|
|
|
|
|
Intangible amortization expense, net of tax
|
|
$0.95
|
|
|
$1.00
|
|
|
|
|
|
|
|
|
Amortization of debt discount on convertible notes, net of tax
|
|
$0.18
|
|
|
$0.18
|
|
|
|
|
|
|
|
|
Adjusted diluted earnings per share
|
|
$6.10
|
|
|
$6.35
|
|
|
|
|
|
|
|
CONFERENCE CALL WEBCAST AND ADDITIONAL INFORMATION
As previously announced, Teleflex will comment on its financial results
on a conference call to be held today at 8:00 a.m. (ET). The call will
be available live and archived on the company’s website at www.teleflex.com
and the accompanying presentation will be posted prior to the call.
An audio replay will be available until February 27, 2015 at 11:59pm
(ET), by calling 888-286-8010 (U.S./Canada) or 617-801-6888
(International), Passcode: 82954645.
ADDITIONAL NOTES
Constant currency revenue growth excludes the impact of translating the
results of international subsidiaries at different currency exchange
rates from period to period.
Certain financial information is presented on a rounded basis, which may
cause minor differences.
Segment results and commentary exclude the impact of discontinued
operations.
NOTES ON NON-GAAP FINANCIAL MEASURES
This press release includes certain non-GAAP financial measures, which
include:
Adjusted diluted earnings per share. This measure excludes, depending on
the period presented (i) the effect of charges associated with our
restructuring programs, as well as goodwill and other asset impairment
charges; (ii) losses and other charges, including acquisition and
integration costs, charges related to facility consolidations, the
establishment of a litigation reserve and a litigation verdict against
the Company with respect to a non-operating joint venture, net of, where
applicable, specified reversals, including a reversal of liabilities
related to certain contingent consideration arrangements and a reversal
of a reserve related to a previously announced stock keeping unit
benefit program; (iii) amortization of the debt discount on the
Company’s convertible notes; (iv) intangible amortization expense; (v)
loss on extinguishment of debt; and (vi) tax benefits resulting from the
resolution of, or expiration of the statute of limitations with respect
to, prior years’ tax matters. In addition, the calculation of diluted
shares within adjusted earnings per share gives effect to the
anti-dilutive impact of the Company’s convertible note hedge agreements,
which reduce the potential economic dilution that otherwise would occur
upon conversion of the Company’s senior subordinated convertible notes
(under GAAP, the anti-dilutive impact of the convertible note hedge
agreements is not reflected in diluted shares).
Constant currency revenue growth. This measure excludes the impact of
translating the results of international subsidiaries at different
currency exchange rates from period to period.
Management believes these measures are useful to investors because they
eliminate items that do not reflect Teleflex’s day-to-day operations. In
addition, management believes that the calculation of non-GAAP diluted
shares is useful to investors because it provides insight into the
offsetting economic effect of the convertible note hedge against
conversions of the convertible notes. Management uses these financial
measures for internal managerial purposes, when publicly providing
guidance on possible future results, and to assist in our evaluation of
period-to-period comparisons. These financial measures are presented in
addition to results presented in accordance with generally accepted
accounting principles (“GAAP”) and should not be relied upon as a
substitute for GAAP financial measures. Tables reconciling historical
non-GAAP measures to the most directly comparable historical GAAP
measures are set forth below. Tables reconciling forecasted non-GAAP
measures to the most directly comparable forecasted GAAP measures are
set forth above.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF CONSOLIDATED STATEMENT OF INCOME ITEMS
|
|
Dollars in millions, except per share amounts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended – December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
Shares used in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(loss) attributable
|
|
Diluted
|
|
calculation of
|
|
|
|
Cost
|
|
Selling,
|
|
|
|
Restructuring
|
|
|
|
Loss on
|
|
|
|
to common
|
|
earnings per
|
|
GAAP and
|
|
|
|
of
|
|
general and
|
|
Research and
|
|
and other
|
|
Interest
|
|
extinguish-
|
|
|
|
shareholders
|
|
share available
|
|
adjusted
|
|
|
|
goods
|
|
administrative
|
|
development
|
|
impairment
|
|
expense,
|
|
ment of
|
|
Income
|
|
from continuing
|
|
to common
|
|
earnings per
|
|
|
|
sold
|
|
expenses
|
|
expenses
|
|
charges
|
|
net
|
|
debt
|
|
taxes
|
|
operations
|
|
shareholders
|
|
share
|
|
GAAP Basis
|
|
$235.0
|
|
$153.3
|
|
$17.2
|
|
$1.4
|
|
$16.6
|
|
—
|
|
$0.4
|
|
$51.8
|
|
$1.10
|
|
47,112
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and other impairment charges
|
|
—
|
|
—
|
|
—
|
|
1.4
|
|
—
|
|
—
|
|
0.5
|
|
0.8
|
|
$0.02
|
|
—
|
|
Losses and other charges (A)
|
|
2.1
|
|
1.0
|
|
0.0
|
|
—
|
|
—
|
|
—
|
|
1.1
|
|
2.0
|
|
$0.04
|
|
—
|
|
Amortization of debt discount on convertible notes
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3.1
|
|
—
|
|
1.1
|
|
2.0
|
|
$0.04
|
|
—
|
|
Intangible amortization expense
|
|
—
|
|
13.9
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3.5
|
|
10.4
|
|
$0.22
|
|
—
|
|
Tax adjustment (B)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3.8
|
|
(3.8)
|
|
($0.08)
|
|
—
|
|
Shares due to Teleflex under note hedge (C)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
$0.09
|
|
(2,990)
|
|
Adjusted basis
|
|
$232.9
|
|
$138.4
|
|
$17.2
|
|
—
|
|
$13.5
|
|
—
|
|
$10.5
|
|
$63.3
|
|
$1.43
|
|
44,122
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended – December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
Shares used in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(loss) attributable
|
|
Diluted
|
|
calculation of
|
|
|
|
Cost
|
|
Selling,
|
|
|
|
Restructuring
|
|
|
|
Loss on
|
|
|
|
to common
|
|
earnings per
|
|
GAAP and
|
|
|
|
of
|
|
general and
|
|
Research and
|
|
and other
|
|
Interest
|
|
extinguish-
|
|
|
|
shareholders
|
|
share available
|
|
adjusted
|
|
|
|
goods
|
|
administrative
|
|
Development
|
|
impairment
|
|
expense,
|
|
ment of
|
|
Income
|
|
from continuing
|
|
to common
|
|
earnings per
|
|
|
|
sold
|
|
expenses
|
|
expenses
|
|
charges
|
|
net
|
|
debt
|
|
taxes
|
|
operations
|
|
shareholders
|
|
share
|
|
GAAP Basis
|
|
$225.6
|
|
$143.8
|
|
$17.9
|
|
$9.2
|
|
$14.2
|
|
—
|
|
$4.6
|
|
$35.1
|
|
$0.78
|
|
45,033
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and other impairment charges
|
|
—
|
|
—
|
|
—
|
|
9.2
|
|
—
|
|
—
|
|
1.7
|
|
7.6
|
|
$0.17
|
|
—
|
|
Losses and other charges (A)
|
|
0.3
|
|
8.2
|
|
0.5
|
|
—
|
|
—
|
|
—
|
|
2.5
|
|
6.5
|
|
$0.14
|
|
—
|
|
Amortization of debt discount on convertible notes
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2.9
|
|
—
|
|
1.1
|
|
1.8
|
|
$0.04
|
|
—
|
|
Intangible amortization expense
|
|
—
|
|
13.5
|
|
—
|
|
—
|
|
—
|
|
—
|
|
4.5
|
|
9.0
|
|
$0.20
|
|
—
|
|
Loss on extinguishment of debt
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
0.0
|
|
0.0
|
|
$0.00
|
|
—
|
|
Tax adjustment (B)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1.5
|
|
(1.5)
|
|
($0.03)
|
|
—
|
|
Shares due to Teleflex under note hedge (C)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
$0.06
|
|
(2,165)
|
|
Adjusted basis
|
|
$225.3
|
|
$122.0
|
|
$17.3
|
|
—
|
|
$11.3
|
|
—
|
|
$15.8
|
|
$58.5
|
|
$1.36
|
|
42,868
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A) In 2014, losses and other charges include approximately $1.6
million, net of tax, or $0.03 per share, related to acquisition and
integration costs, and charges related to facility consolidations; and
approximately $0.4 million, net of tax, or $0.01 per share, related to a
litigation verdict against the Company with respect to a non-operating
joint venture. In 2013, losses and other charges include approximately
$4.5 million, net of tax, or $0.10 per share, related to acquisition and
integration costs; approximately $1.9 million, net of tax, or $0.04 per
share, related to the establishment of a litigation reserve; reversals
included approximately $0.1 million, net of tax, or $0.00 per share,
related to the reversal of contingent consideration liabilities.
(B) The tax adjustment represents a net benefit resulting from the
resolution of, or the expiration of statute of limitations with respect
to various prior years’ U.S. federal, state and foreign tax matters.
(C) Adjusted diluted shares are calculated by giving effect to the
anti-dilutive impact of the Company’s convertible note hedge agreements,
which reduce the potential economic dilution that otherwise would occur
upon conversion of our senior subordinated convertible notes. Under
GAAP, the anti-dilutive impact of the convertible note hedge agreements
is not reflected in diluted shares.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF CONSOLIDATED STATEMENT OF INCOME ITEMS
|
|
Dollars in millions, except per share amounts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended – December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
Shares used in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(loss) attributable
|
|
Diluted
|
|
calculation of
|
|
|
|
Cost
|
|
Selling,
|
|
|
|
Restructuring
|
|
|
|
Loss on
|
|
|
|
to common
|
|
earnings per
|
|
GAAP and
|
|
|
|
of
|
|
general and
|
|
Research and
|
|
and other
|
|
Interest
|
|
extinguish-
|
|
|
|
shareholders
|
|
share available
|
|
adjusted
|
|
|
|
goods
|
|
administrative
|
|
development
|
|
impairment
|
|
expense,
|
|
ment of
|
|
Income
|
|
from continuing
|
|
to common
|
|
earnings per
|
|
|
|
sold
|
|
expenses
|
|
expenses
|
|
charges
|
|
net
|
|
debt
|
|
taxes
|
|
operations
|
|
shareholders
|
|
share
|
|
GAAP Basis
|
|
$897.4
|
|
$578.7
|
|
$61.0
|
|
$17.9
|
|
$64.8
|
|
—
|
|
$28.7
|
|
$190.4
|
|
$4.10
|
|
46,470
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and other impairment charges
|
|
—
|
|
—
|
|
—
|
|
17.9
|
|
—
|
|
—
|
|
5.2
|
|
12.7
|
|
$0.27
|
|
—
|
|
Losses and other charges (A)
|
|
4.9
|
|
(1.1)
|
|
0.1
|
|
—
|
|
—
|
|
—
|
|
3.1
|
|
0.9
|
|
$0.02
|
|
—
|
|
Amortization of debt discount on convertible notes
|
|
—
|
|
—
|
|
—
|
|
—
|
|
12.2
|
|
—
|
|
4.5
|
|
7.7
|
|
$0.17
|
|
—
|
|
Intangible amortization expense
|
|
—
|
|
60.9
|
|
—
|
|
—
|
|
—
|
|
—
|
|
17.4
|
|
43.5
|
|
$0.94
|
|
—
|
|
Tax adjustment (B)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
4.0
|
|
(4.0)
|
|
($0.09)
|
|
—
|
|
Shares due to Teleflex under note hedge (C)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
$0.33
|
|
(2,738)
|
|
Adjusted basis
|
|
$892.5
|
|
$518.8
|
|
$60.9
|
|
—
|
|
$52.5
|
|
—
|
|
$62.8
|
|
$251.2
|
|
$5.74
|
|
43,732
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended – December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
Shares used in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(loss) attributable
|
|
Diluted
|
|
calculation of
|
|
|
|
Cost
|
|
Selling,
|
|
|
|
Restructuring
|
|
|
|
Loss on
|
|
|
|
to common
|
|
earnings per
|
|
GAAP and
|
|
|
|
of
|
|
general and
|
|
Research and
|
|
and other
|
|
Interest
|
|
extinguish-
|
|
|
|
shareholders
|
|
share available
|
|
adjusted
|
|
|
|
goods
|
|
administrative
|
|
Development
|
|
impairment
|
|
expense,
|
|
ment of
|
|
Income
|
|
from continuing
|
|
to common
|
|
earnings per
|
|
|
|
sold
|
|
expenses
|
|
expenses
|
|
charges
|
|
net
|
|
debt
|
|
taxes
|
|
operations
|
|
shareholders
|
|
share
|
|
GAAP Basis
|
|
$857.3
|
|
$502.2
|
|
$65.0
|
|
$38.5
|
|
$56.3
|
|
$1.3
|
|
$23.5
|
|
$151.3
|
|
$3.46
|
|
43,693
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and other impairment charges
|
|
—
|
|
—
|
|
—
|
|
38.5
|
|
—
|
|
—
|
|
7.8
|
|
30.7
|
|
$0.71
|
|
—
|
|
Losses and other charges (A)
|
|
2.3
|
|
1.5
|
|
0.5
|
|
—
|
|
—
|
|
—
|
|
4.9
|
|
(0.6)
|
|
($0.02)
|
|
—
|
|
Amortization of debt discount on convertible notes
|
|
—
|
|
—
|
|
—
|
|
—
|
|
11.3
|
|
—
|
|
4.1
|
|
7.2
|
|
$0.16
|
|
—
|
|
Intangible amortization expense
|
|
—
|
|
50.6
|
|
—
|
|
—
|
|
—
|
|
—
|
|
17.3
|
|
33.4
|
|
$0.76
|
|
—
|
|
Loss on extinguishment of debt
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1.3
|
|
0.5
|
|
0.8
|
|
$0.02
|
|
—
|
|
Tax adjustment (B)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
11.1
|
|
(11.1)
|
|
($0.25)
|
|
—
|
|
Shares due to Teleflex under note hedge (C)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
$0.19
|
|
(1,620)
|
|
Adjusted basis
|
|
$855.1
|
|
$450.1
|
|
$64.5
|
|
—
|
|
$45.0
|
|
—
|
|
$69.2
|
|
$211.6
|
|
$5.03
|
|
42,073
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A) In 2014, losses and other charges include approximately $8.6
million, net of tax, or $0.19 per share, related to acquisition and
integration costs, and charges related to facility consolidations; and
approximately $0.4 million, net of tax, or $0.01 per share, related to a
litigation verdict against the Company with respect to a non-operating
joint venture; reversals include approximately ($8.1) million, net of
tax, or ($0.18) per share, related to the reversal of contingent
consideration liabilities. In 2013, losses and other charges include
approximately $0.8 million, net of tax, or $0.02 per share, related to a
litigation verdict against the Company with respect to a non-operating
joint venture; $9.5 million, net of tax, or $0.21 per share, related to
acquisition and integration costs; and approximately $1.9 million, net
of tax, or $0.04 per share, related to the establishment of a litigation
reserve; reversals include approximately ($12.4) million, net of tax, or
($0.28) per share, related to the reversal of contingent consideration
liabilities and ($0.4) million, net of tax, or ($0.01) per share,
related to reversal of a reserve with respect to a previously announced
stock keeping unit (“SKU”) rationalization charge.
(B) The tax adjustment represents a net benefit resulting from the
resolution of, or the expiration of statute of limitations with respect
to various prior years’ U.S. federal, state and foreign tax matters.
(C) Adjusted diluted shares are calculated by giving effect to the
anti-dilutive impact of the Company’s convertible note hedge agreements,
which reduce the potential economic dilution that otherwise would occur
upon conversion of our senior subordinated convertible notes. Under
GAAP, the anti-dilutive impact of the convertible note hedge agreements
is not reflected in diluted shares.
RECONCILIATION OF NET DEBT OBLIGATIONS
|
|
|
|
|
|
|
|
|
December 31, 2014
|
|
December 31, 2013
|
|
|
|
(Dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
Note payable and current portion of long term borrowings
|
|
$
|
368,401
|
|
|
$
|
356,287
|
|
|
|
|
|
|
|
|
|
|
Long term borrowings
|
|
|
700,000
|
|
|
|
930,000
|
|
|
|
|
|
|
|
|
|
|
Unamortized debt discount
|
|
|
36,197
|
|
|
|
48,413
|
|
|
|
|
|
|
|
|
|
|
Total debt obligations
|
|
|
1,104,598
|
|
|
|
1,334,700
|
|
|
|
|
|
|
|
|
|
|
Less: cash and cash equivalents
|
|
|
303,236
|
|
|
|
431,984
|
|
|
|
|
|
|
|
|
|
|
Net debt obligations
|
|
$
|
801,362
|
|
|
$
|
902,716
|
|
|
|
|
|
|
|
|
|
ABOUT TELEFLEX INCORPORATED
Teleflex is a leading global provider of specialty medical devices for a
range of procedures in critical care and surgery. Our mission is to
provide solutions that enable healthcare providers to improve outcomes
and enhance patient and provider safety. Headquartered in Wayne, PA,
Teleflex employs approximately 11,700 people and serves healthcare
providers worldwide. For additional information about Teleflex please
refer to www.teleflex.com.
CAUTION CONCERNING FORWARD-LOOKING INFORMATION
This press release contains forward-looking statements, including, but
not limited to, forecasted 2015 GAAP and constant currency revenue
growth and GAAP and adjusted diluted earnings per share, as well as
expectations of significant operating leverage in 2015. Actual results
could differ materially from those in the forward-looking statements due
to, among other things, conditions in the end markets we serve, customer
reaction to new products and programs, our ability to achieve sales
growth, price increases or cost reductions; changes in the reimbursement
practices of third party payors; our ability to realize efficiencies and
to execute on our strategic initiatives; changes in material costs and
surcharges; market acceptance and unanticipated difficulties in
connection with the introduction of new products and product line
extensions; product recalls; unanticipated difficulties in connection
with the consolidation of manufacturing and administrative functions,
including as a result of difficulties with various employees, labor
representatives or regulators; the loss of skilled employees in
connection with such initiatives; unanticipated difficulties,
expenditures and delays in complying with government regulations
applicable to our businesses; the impact of government healthcare reform
legislation; our ability to meet our debt obligations; changes in
general and international economic conditions; and other factors
described or incorporated in our filings with the Securities and
Exchange Commission, including our Annual Report on Form 10-K for the
year ended December 31, 2014.
|
|
|
|
|
|
TELEFLEX INCORPORATED AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF INCOME
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
December 31,
2014
|
|
|
December 31,
2013
|
|
|
|
|
(Dollars and shares in thousands,
except per share)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
$
|
476,008
|
|
|
$
|
450,539
|
|
|
Cost of goods sold
|
|
|
234,993
|
|
|
|
225,596
|
|
|
Gross profit
|
|
|
241,015
|
|
|
|
224,943
|
|
|
Selling, general and administrative expenses
|
|
|
153,265
|
|
|
|
143,756
|
|
|
Research and development expenses
|
|
|
17,237
|
|
|
|
17,876
|
|
|
Restructuring and other impairment charges
|
|
|
1,358
|
|
|
|
9,247
|
|
|
Income from continuing operations before interest and taxes
|
|
|
69,155
|
|
|
|
54,064
|
|
|
Interest expense
|
|
|
16,808
|
|
|
|
14,339
|
|
|
Interest income
|
|
|
(212
|
)
|
|
|
(166
|
)
|
|
Income from continuing operations before taxes
|
|
|
52,559
|
|
|
|
39,891
|
|
|
Taxes on income from continuing operations
|
|
|
426
|
|
|
|
4,589
|
|
|
Income from continuing operations
|
|
|
52,133
|
|
|
|
35,302
|
|
|
Loss from discontinued operations before taxes
|
|
|
(1,541
|
)
|
|
|
(459
|
)
|
|
Tax benefit on loss from discontinued operations
|
|
|
(353
|
)
|
|
|
(223
|
)
|
|
Loss from discontinued operations
|
|
|
(1,188
|
)
|
|
|
(236
|
)
|
|
Net income
|
|
|
50,945
|
|
|
|
35,066
|
|
|
Less: Income from continuing operations attributable to
noncontrolling interest
|
|
|
307
|
|
|
|
238
|
|
|
Net income attributable to common shareholders
|
|
$
|
50,638
|
|
|
$
|
34,828
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share available to common shareholders:
|
|
|
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
|
|
|
Income from continuing operations
|
|
$
|
1.25
|
|
|
$
|
0.85
|
|
|
Loss from discontinued operations
|
|
|
(0.03
|
)
|
|
|
—
|
|
|
Net income
|
|
$
|
1.22
|
|
|
$
|
0.85
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted:
|
|
|
|
|
|
|
|
|
|
Income from continuing operations
|
|
$
|
1.10
|
|
|
$
|
0.78
|
|
|
Loss from discontinued operations
|
|
|
(0.03
|
)
|
|
|
(0.01
|
)
|
|
Net income
|
|
$
|
1.07
|
|
|
$
|
0.77
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends per share
|
|
$
|
0.34
|
|
|
$
|
0.34
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
41,425
|
|
|
|
41,161
|
|
|
Diluted
|
|
|
47,112
|
|
|
|
45,033
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of tax
|
|
$
|
51,826
|
|
|
$
|
35,064
|
|
|
Loss from discontinued operations, net of tax
|
|
|
(1,188
|
)
|
|
|
(236
|
)
|
|
Net income
|
|
$
|
50,638
|
|
|
$
|
34,828
|
|
|
|
|
TELEFLEX INCORPORATED AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF INCOME
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
|
December 31,
2014
|
|
|
December 31,
2013
|
|
|
|
(Dollars and shares in thousands,
except per share)
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
$
|
1,839,832
|
|
|
$
|
1,696,271
|
|
|
Cost of goods sold
|
|
|
897,404
|
|
|
|
857,326
|
|
|
Gross profit
|
|
|
942,428
|
|
|
|
838,945
|
|
|
Selling, general and administrative expenses
|
|
|
578,657
|
|
|
|
502,187
|
|
|
Research and development expenses
|
|
|
61,040
|
|
|
|
65,045
|
|
|
Restructuring and other impairment charges
|
|
|
17,869
|
|
|
|
38,452
|
|
|
Income from continuing operations before interest and taxes
|
|
|
284,862
|
|
|
|
233,261
|
|
|
Interest expense
|
|
|
65,458
|
|
|
|
56,905
|
|
|
Interest income
|
|
|
(706
|
)
|
|
|
(624
|
)
|
|
Loss on extinguishments of debt
|
|
|
—
|
|
|
|
1,250
|
|
|
Income from continuing operations before taxes
|
|
|
220,110
|
|
|
|
175,730
|
|
|
Taxes on income from continuing operations
|
|
|
28,650
|
|
|
|
23,547
|
|
|
Income from continuing operations
|
|
|
191,460
|
|
|
|
152,183
|
|
|
Loss from discontinued operations before taxes
|
|
|
(3,407
|
)
|
|
|
(2,205
|
)
|
|
Tax benefit on loss from discontinued operations
|
|
|
(698
|
)
|
|
|
(1,770
|
)
|
|
Loss from discontinued operations
|
|
|
(2,709
|
)
|
|
|
(435
|
)
|
|
Net income
|
|
|
188,751
|
|
|
|
151,748
|
|
|
Less: Income from continuing operations attributable to
noncontrolling interest
|
|
|
1,072
|
|
|
|
867
|
|
|
Net income attributable to common shareholders
|
|
$
|
187,679
|
|
|
$
|
150,881
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share available to common shareholders:
|
|
|
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
|
|
|
Income from continuing operations
|
|
$
|
4.60
|
|
|
$
|
3.68
|
|
|
Loss from discontinued operations
|
|
|
(0.06
|
)
|
|
|
(0.01
|
)
|
|
Net income
|
|
$
|
4.54
|
|
|
$
|
3.67
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted:
|
|
|
|
|
|
|
|
|
|
Income from continuing operations
|
|
$
|
4.10
|
|
|
$
|
3.46
|
|
|
Loss from discontinued operations
|
|
|
(0.06
|
)
|
|
|
(0.01
|
)
|
|
Net income
|
|
$
|
4.04
|
|
|
$
|
3.45
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends per share
|
|
$
|
1.36
|
|
|
$
|
1.36
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
41,366
|
|
|
|
41,105
|
|
|
Diluted
|
|
|
46,470
|
|
|
|
43,693
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of tax
|
|
$
|
190,388
|
|
|
$
|
151,316
|
|
|
Loss from discontinued operations, net of tax
|
|
|
(2,709
|
)
|
|
|
(435
|
)
|
|
Net income
|
|
$
|
187,679
|
|
|
$
|
150,881
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELEFLEX INCORPORATED AND SUBSIDIARIES
|
|
CONSOLIDATED BALANCE SHEETS
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
December 31,
2014
|
|
December 31,
2013
|
|
|
|
(Dollars in thousands)
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
303,236
|
|
$
|
431,984
|
|
|
Accounts receivable, net
|
|
|
273,704
|
|
|
295,290
|
|
|
Inventories, net
|
|
|
335,593
|
|
|
333,621
|
|
|
Prepaid expenses and other current assets
|
|
|
35,697
|
|
|
39,810
|
|
|
Prepaid taxes
|
|
|
40,256
|
|
|
36,504
|
|
|
Deferred tax assets
|
|
|
57,301
|
|
|
52,917
|
|
|
Assets held for sale
|
|
|
7,422
|
|
|
10,428
|
|
|
Total current assets
|
|
|
1,053,209
|
|
|
1,200,554
|
|
|
Property, plant and equipment, net
|
|
|
317,435
|
|
|
325,900
|
|
|
Goodwill
|
|
|
1,323,553
|
|
|
1,354,203
|
|
|
Intangible assets, net
|
|
|
1,216,720
|
|
|
1,255,597
|
|
|
Investments in affiliates
|
|
|
1,150
|
|
|
1,715
|
|
|
Deferred tax assets
|
|
|
1,178
|
|
|
943
|
|
|
Other assets
|
|
|
64,010
|
|
|
70,095
|
|
|
Total assets
|
|
$
|
3,977,255
|
|
$
|
4,209,007
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
Current borrowings
|
|
$
|
368,401
|
|
$
|
356,287
|
|
|
Accounts payable
|
|
|
64,100
|
|
|
71,967
|
|
|
Accrued expenses
|
|
|
72,383
|
|
|
74,868
|
|
|
Current portion of contingent consideration
|
|
|
11,276
|
|
|
4,131
|
|
|
Payroll and benefit-related liabilities
|
|
|
85,442
|
|
|
73,090
|
|
|
Accrued interest
|
|
|
9,169
|
|
|
8,725
|
|
|
Income taxes payable
|
|
|
13,768
|
|
|
23,821
|
|
|
Other current liabilities
|
|
|
10,360
|
|
|
22,231
|
|
|
Total current liabilities
|
|
|
634,899
|
|
|
635,120
|
|
|
Long-term borrowings
|
|
|
700,000
|
|
|
930,000
|
|
|
Deferred tax liabilities
|
|
|
451,541
|
|
|
514,715
|
|
|
Pension and postretirement benefit liabilities
|
|
|
167,241
|
|
|
109,498
|
|
|
Noncurrent liability for uncertain tax provisions
|
|
|
50,884
|
|
|
55,152
|
|
|
Other liabilities
|
|
|
58,991
|
|
|
48,506
|
|
|
Total liabilities
|
|
|
2,063,556
|
|
|
2,292,991
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
Common shareholders’ equity
|
|
|
|
|
|
|
|
|
Common shares, $1 par value Issued: 2014 – 43,420 shares; 2013 –
43,243 shares
|
|
|
43,420
|
|
|
43,243
|
|
|
Additional paid-in capital
|
|
|
422,394
|
|
|
409,338
|
|
|
Retained earnings
|
|
|
1,827,845
|
|
|
1,696,424
|
|
|
Accumulated other comprehensive loss
|
|
|
(260,895
|
)
|
|
(110,855
|
)
|
|
|
|
|
2,032,764
|
|
|
2,038,150
|
|
|
Less: Treasury stock, at cost
|
|
|
121,455
|
|
|
124,623
|
|
|
Total common shareholders’ equity
|
|
|
1,911,309
|
|
|
1,913,527
|
|
|
Noncontrolling interest
|
|
|
2,390
|
|
|
2,489
|
|
|
Total equity
|
|
|
1,913,699
|
|
|
1,916,016
|
|
|
Total liabilities and equity
|
|
$
|
3,977,255
|
|
$
|
4,209,007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELEFLEX INCORPORATED AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
|
December 31,
2014
|
|
December 31,
2013
|
|
|
|
(Dollars in thousands)
|
|
Cash Flows from Operating Activities of Continuing Operations:
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
188,751
|
|
|
$
|
151,748
|
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations
|
|
|
2,709
|
|
|
|
435
|
|
|
Depreciation expense
|
|
|
50,207
|
|
|
|
42,368
|
|
|
Amortization expense of intangible assets
|
|
|
60,926
|
|
|
|
50,608
|
|
|
Amortization expense of deferred financing costs and debt discount
|
|
|
15,897
|
|
|
|
14,959
|
|
|
Loss on extinguishments of debt
|
|
|
—
|
|
|
|
1,250
|
|
|
Impairment of long-lived assets
|
|
|
—
|
|
|
|
3,460
|
|
|
Changes in contingent consideration
|
|
|
(7,418
|
)
|
|
|
(12,642
|
)
|
|
Stock-based compensation
|
|
|
12,227
|
|
|
|
11,871
|
|
|
Deferred income taxes, net
|
|
|
(14,153
|
)
|
|
|
(10,182
|
)
|
|
Other
|
|
|
(8,968
|
)
|
|
|
(1,319
|
)
|
|
Changes in operating assets and liabilities, net of effects of
acquisitions and disposals:
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
9,394
|
|
|
|
(1,294
|
)
|
|
Inventories
|
|
|
(15,531
|
)
|
|
|
(8,931
|
)
|
|
Prepaid expenses and other current assets
|
|
|
1,422
|
|
|
|
(5,926
|
)
|
|
Accounts payable and accrued expenses
|
|
|
9,818
|
|
|
|
2,001
|
|
|
Income taxes receivable and payable, net
|
|
|
(15,040
|
)
|
|
|
(7,107
|
)
|
|
Net cash provided by operating activities from continuing operations
|
|
|
290,241
|
|
|
|
231,299
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities of Continuing Operations:
|
|
|
|
|
|
|
|
|
|
Expenditures for property, plant and equipment
|
|
|
(67,571
|
)
|
|
|
(63,580
|
)
|
|
Payments for businesses and intangibles acquired, net of cash
acquired
|
|
|
(45,777
|
)
|
|
|
(309,008
|
)
|
|
Proceeds from sales of businesses and assets, net of cash sold
|
|
|
5,251
|
|
|
|
—
|
|
|
Investment in affiliates
|
|
|
(40
|
)
|
|
|
(50
|
)
|
|
Net cash used in investing activities from continuing operations
|
|
|
(108,137
|
)
|
|
|
(372,638
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Financing Activities of Continuing Operations:
|
|
|
|
|
|
|
|
|
|
Proceeds from long-term borrowings
|
|
|
250,000
|
|
|
|
680,000
|
|
|
Repayment of long-term borrowings
|
|
|
(480,102
|
)
|
|
|
(375,000
|
)
|
|
Debt extinguishment, issuance and amendment fees
|
|
|
(4,494
|
)
|
|
|
(6,400
|
)
|
|
Proceeds from share based compensation plans and the related tax
impacts
|
|
|
4,245
|
|
|
|
6,181
|
|
|
Payments to noncontrolling interest shareholders
|
|
|
(1,094
|
)
|
|
|
(736
|
)
|
|
Payments for contingent consideration
|
|
|
—
|
|
|
|
(16,958
|
)
|
|
Dividends
|
|
|
(56,258
|
)
|
|
|
(55,917
|
)
|
|
Net cash (used in) provided by financing activities from
continuing operations
|
|
|
(287,703
|
)
|
|
|
231,170
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Discontinued Operations:
|
|
|
|
|
|
|
|
|
|
Net cash used in operating activities
|
|
|
(3,676
|
)
|
|
|
(3,327
|
)
|
|
Net cash used in discontinued operations
|
|
|
(3,676
|
)
|
|
|
(3,327
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
(19,473
|
)
|
|
|
8,441
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
|
(128,748
|
)
|
|
|
94,945
|
|
|
Cash and cash equivalents at the beginning of the period
|
|
|
431,984
|
|
|
|
337,039
|
|
|
Cash and cash equivalents at the end of the period
|
|
$
|
303,236
|
|
|
$
|
431,984
|
|
|
|
|
|
|
|
|
|
|
|
Source: Teleflex Incorporated
Teleflex Incorporated
Jake Elguicze
Treasurer and Vice
President of Investor Relations
610-948-2836