ICU Medical, Inc. Announces Third Quarter 2017 Results


Nov 9, 2017
Company Updates FY 2017 Guidance and Provides Initial FY 2018 EBITDA and Adjusted EPS Guidance

SAN CLEMENTE, Calif., Nov. 09, 2017 (GLOBE NEWSWIRE) -- ICU Medical, Inc. (Nasdaq:ICUI), a leader in the development, manufacture and sale of innovative medical devices used in infusion therapy and critical care applications, today announced financial results for the quarter ended September 30, 2017.

Third Quarter 2017 Results

Third quarter 2017 revenue was $343.2 million, compared to $97.1 million in the same period last year. GAAP gross profit for the third quarter of 2017 was $111.6 million, as compared to $51.3 million in the same period last year.  GAAP gross margin for the third quarter of 2017 was 33%, as compared to 53% in the same period last year.  GAAP net income for the third quarter of 2017 was $0.1 million, or $0.01 per diluted share, as compared to GAAP net income of $18.8 million, or $1.09 per diluted share, for the third quarter of 2016.

Adjusted net sales for the third quarter of 2017 was $334.6 million. Adjusted gross profit for the third quarter of 2017 was $122.8 million.  Adjusted gross margin for the third quarter of 2017 was 37%.  Adjusted diluted earnings per share for the third quarter of 2017 were $1.12 as compared to $1.35 for the third quarter of 2016.  Also, adjusted EBITDA was $55.4 million for the third quarter of 2017 as compared to $34.0 million for the third quarter of 2016.

Adjusted net sales, adjusted gross profit, adjusted gross margin, adjusted diluted earnings per share and adjusted EBITDA are measures calculated and presented on the basis of methodologies other than in accordance with GAAP.  Please refer to the Use of Non-GAAP Financial Information following the financial statements herein for further discussion and reconciliations of these measures to GAAP measures.

Vivek Jain, ICU Medical's Chief Executive Officer, said, "Third quarter revenues were in-line with our expectations and our adjusted EBITDA and adjusted earnings per share were slightly ahead of our expectations.”

Revenues by market segment for the three and nine months ended September 30, 2017 and 2016 were as follows (in millions):

                     
    Three months ended
September 30,
          Nine months ended
September 30,
   
Market Segment   2017   2016   $ Change   %
Change
  2017   2016   $
Change
  %
Change
Infusion Consumables   $ 92.7     $ 82.8     $ 9.9     12.0 %   $ 245.9     $ 242.7     $ 3.2     1.3 %
IV Solutions   143.7         143.7     *   375.5         375.5     *
Infusion Systems   82.8         82.8     *   202.6         202.6     *
Critical Care   12.9     14.0     (1.1 )   (7.9 )%   37.2     40.3     (3.1 )   (7.7 )%
Other   11.1     0.3     10.8     3,600.0 %   61.3     0.7     60.6     8,657.1 %
    $ 343.2     $ 97.1     $ 246.1     253.5 %   $ 922.5     $ 283.7     $ 638.8     225.2 %
                                                             
* Not Applicable
                                                             

The Company ended the third quarter of 2017 with a strong balance sheet. As of September 30, 2017, cash, cash equivalents and short and long-term investment securities totaled $325.3 million, working capital was $711.6 million and long-term debt obligations were $75 million.

Fiscal Year 2017 Guidance Update and Initial Fiscal 2018 Guidance

The Company is modifying its full year 2017 guidance of adjusted EBITDA from a range of $180 million to $190 million to a range of $195 million to $205 million and adjusted earnings per share from a range of $3.80 to $4.20 to a range of $4.20 to $4.80.  The Company is also providing initial 2018 adjusted EBITDA guidance in the range of $240 million to $260 million and initial 2018 adjusted EPS in the range of $6.05 to $6.65.

Conference Call

The Company will host a conference call to discuss third quarter 2017 financial results today at 4:30 p.m. EST (1:30 p.m. PST).   The call can be accessed at (800) 936-9761, international (408) 774-4587, conference ID 99528019.  The conference call will be simultaneously available by webcast, which can be accessed by going to the Company's website at www.icumed.com, clicking on the Investors tab, clicking on the Webcast icon and following the prompts. The webcast will also be available by replay.

About ICU Medical, Inc.

ICU Medical, Inc. (Nasdaq:ICUI) develops, manufactures and sells innovative medical devices used in vascular therapy, and critical care applications. ICU Medical's product portfolio includes IV smart pumps, sets, connectors, closed transfer devices for hazardous drugs, cardiac monitoring systems, along with pain management and safety software technology designed to help meet clinical, safety and workflow goals. ICU Medical is headquartered in San Clemente, California. More information about ICU Medical, Inc. can be found at www.icumed.com.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements contain words such as ''will,'' ''expect,'' ''believe,'' ''could,'' ''would,'' ''estimate,'' ''continue,'' ''build,'' ''expand'' or the negative thereof or comparable terminology, and may include (without limitation) information regarding the Company's expectations, goals or intentions regarding the future, and our recently completed acquisition of the Hospira infusion systems business. These forward-looking statements are based on management's current expectations, estimates, forecasts and projections about the Company and assumptions management believes are reasonable, all of which are subject to risks and uncertainties that could cause actual results and events to differ materially from those stated in the forward-looking statements. These risks and uncertainties include, but are not limited to, decreased demand for the Company's products, decreased free cash flow, the inability to recapture conversion delays or part/resource shortages on anticipated timing, or at all, changes in product mix, increased competition from competitors, lack of continued growth or improving efficiencies, unexpected changes in the Company's arrangements with its largest customers and the Company’s ability to meet expectations regarding the integration of the Hospira infusion systems business. Future results are subject to risks and uncertainties, including the risk factors, and other risks and uncertainties, described in the Company's filings with the Securities and Exchange Commission, which include those in the Annual Report on Form 10-K for the year ended December 31, 2016 and our subsequent filings. Forward-looking statements contained in this press release are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.


ICU MEDICAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

       
  September 30,
2017
  December 31,
2016
  (unaudited)   (1)
ASSETS      
CURRENT ASSETS:      
Cash and cash equivalents $ 300,614     $ 445,082  
Short-term investment securities 9,591      
Cash, cash equivalents and investment securities 310,205     445,082  
Accounts receivable, net 105,090     56,161  
Inventories 320,341     49,264  
Income tax receivable 12,105     11,235  
Prepaid expenses and other current assets 146,471     7,355  
Assets held for sale 12,489      
TOTAL CURRENT ASSETS 906,701     569,097  
       
PROPERTY AND EQUIPMENT, net 390,526     85,696  
LONG-TERM INVESTMENT SECURITIES 15,140      
OTHER ASSETS 35,192      
GOODWILL 6,687     5,577  
INTANGIBLE ASSETS, net 152,338     22,383  
DEFERRED INCOME TAXES 16,390     21,935  
TOTAL ASSETS $ 1,522,974     $ 704,688  
LIABILITIES AND STOCKHOLDERS’ EQUITY      
CURRENT LIABILITIES:      
Accounts payable $ 44,685     $ 14,641  
Accrued liabilities 146,147     25,896  
Income tax liability 4,263      
TOTAL CURRENT LIABILITIES 195,095     40,537  
       
EARN-OUT LIABILITY 32,000      
LONG-TERM OBLIGATIONS 75,000      
OTHER LONG-TERM LIABILITIES 68,034     1,107  
DEFERRED INCOME TAXES 9,491     1,370  
INCOME TAX LIABILITY 1,519     1,519  
COMMITMENTS AND CONTINGENCIES      
STOCKHOLDERS’ EQUITY:      
Convertible preferred stock      
Common stock 2,002     1,633  
Additional paid-in capital 607,694     162,828  
Treasury stock (2 )   (14 )
Retained earnings 535,919     516,980  
Accumulated other comprehensive loss (3,778 )   (21,272 )
TOTAL STOCKHOLDERS' EQUITY 1,141,835     660,155  
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,522,974     $ 704,688  
               
(1) December 31, 2016 balances were derived from audited consolidated financial statements.
               


ICU MEDICAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except per share data)

       
  Three months ended
September 30,
  Nine months ended
September 30,
  2017   2016   2017   2016
REVENUES:              
Net sales $ 343,084     $ 97,098     $ 921,544     $ 283,659  
Other 152     10     945     25  
TOTAL REVENUE 343,236     97,108     922,489     283,684  
COST OF GOODS SOLD 231,638     45,835     633,884     133,046  
GROSS PROFIT 111,598     51,273     288,605     150,638  
OPERATING EXPENSES:              
Selling, general and administrative 76,820     22,362     226,812     66,828  
Research and development 12,769     3,650     37,377     10,301  
Restructuring, strategic transaction and integration 18,711     2,806     68,033     4,339  
Change in fair value of earn-out 7,000         13,000      
TOTAL OPERATING EXPENSES 115,300     28,818     345,222     81,468  
(LOSS) INCOME FROM OPERATIONS (3,702 )   22,455     (56,617 )   69,170  
BARGAIN PURCHASE GAIN 8,534     346     71,771     1,456  
INTEREST EXPENSE (705 )   (58 )   (1,743 )   (135 )
OTHER INCOME (EXPENSE), net 583     283     (2,030 )   584  
INCOME BEFORE INCOME TAXES 4,710     23,026     11,381     71,075  
(PROVISION) BENEFIT FOR INCOME TAXES (4,574 )   (4,220 )   7,558     (17,503 )
NET INCOME $ 136     $ 18,806     $ 18,939     $ 53,572  
NET INCOME PER SHARE              
Basic $ 0.01     $ 1.16     $ 0.97     $ 3.32  
Diluted $ 0.01     $ 1.09     $ 0.92     $ 3.13  
WEIGHTED AVERAGE NUMBER OF SHARES              
Basic 19,984     16,200     19,433     16,113  
Diluted 21,106     17,286     20,603     17,100  
                       


ICU MEDICAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In thousands)

   
  Nine months ended
September 30,
  2017   2016
CASH FLOWS FROM OPERATING ACTIVITIES:      
Net income $ 18,939     $ 53,572  
Adjustments to reconcile net income to net cash provided by operating activities:      
Depreciation and amortization 47,512     14,351  
Provision for doubtful accounts 1,906      
Provision for warranty and returns 3,639     (22 )
Stock compensation 13,387     11,464  
Loss on disposal of property and equipment 3,177     40  
Bargain purchase gain (71,771 )   (1,456 )
Bond premium amortization 12     1,026  
Change in fair value of earn-out 13,000      
Other 1,690     69  
Changes in operating assets and liabilities:      
Accounts receivable (51,498 )   4,736  
Inventories 148,482     (6,635 )
Prepaid expenses and other assets (125,403 )   (2,228 )
Accounts payable 17,551     (1,587 )
Accrued liabilities 63,234     (7,314 )
Income taxes, including excess tax benefits and deferred income taxes (13,982 )   2,691  
Net cash provided by operating activities 69,875     68,707  
CASH FLOWS FROM INVESTING ACTIVITIES:      
Purchases of property and equipment (51,702 )   (15,018 )
Proceeds from sale of assets 2     1  
Business acquisitions, net of cash acquired (157,097 )   (2,584 )
Intangible asset additions (3,718 )   (861 )
Purchases of investment securities (24,743 )   (111,575 )
Proceeds from sale of investment securities     45,429  
Net cash used in investing activities (237,258 )   (84,608 )
CASH FLOWS FROM FINANCING ACTIVITIES:      
Proceeds from exercise of stock options 19,967     15,830  
Proceeds from employee stock purchase plan 2,705     2,361  
Purchase of treasury stock (3,951 )   (17,155 )
Net cash provided by financing activities 18,721     1,036  
Effect of exchange rate changes on cash 4,194     1,664  
NET DECREASE IN CASH AND CASH EQUIVALENTS (144,468 )   (13,201 )
CASH AND CASH EQUIVALENTS, beginning of period 445,082     336,164  
CASH AND CASH EQUIVALENTS, end of period $ 300,614     $ 322,963  
               

Use of Non-GAAP Financial Information

This press release contains financial measures that are not calculated in accordance with U.S. generally accepted accounting principles ("GAAP").  The non-GAAP financial measures should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.  There are material limitations in using these non-GAAP financial measures because they are not prepared in accordance with GAAP and may not be comparable to similarly titled non-GAAP financial measures used by other companies, including peer companies.  Our management believes that the non-GAAP data provides useful supplemental information to management and investors regarding our performance and facilitates a more meaningful comparison of results of operations between current and prior periods.  We use non-GAAP financial measures in addition to and in conjunction with GAAP financial measures to analyze and assess the overall performance of our business, in making financial, operating and planning decisions, and in determining executive incentive compensation.  The non-GAAP financial measures included in this press release are adjusted net sales, adjusted gross profit, adjusted gross profit margin, adjusted EBITDA and adjusted diluted earnings per share ("Adjusted Diluted EPS").

Adjusted net sales includes/excludes the following items from net sales:

Excludes contract manufacturing revenue:  We manufacture certain products for Pfizer at cost in accordance with a manufacturing services agreement.  We do not include the contract manufacturing revenue in our adjusted net sales as the revenue under this agreement was negotiated contemporaneously with our acquisition of the Hospira infusion systems (HIS) business from Pfizer and is not indicative of a normal market transaction.

Includes ICU intercompany sales to the HIS business: We include intercompany sales to the HIS business for inventory that we previously sold to Pfizer, which remained on the opening balance sheet of the HIS business at the time we acquired it from Pfizer.

Adjusted gross profit excludes the following from gross profit:

Adjustment to reverse the cost recognition related to the purchase accounting write-up of inventory to fair market value: The inventory step-up represents the expense recognition of fair value adjustments in excess of the historical cost basis of inventory obtained through acquisition, these charges are outside of our normal operations and are excluded.

Adjusted gross profit margin is calculated using the adjusted gross profit as a percentage of the adjusted net sales as determined above.

Adjusted EBITDA excludes the following items from net income:

Interest, net:  We exclude interest in deriving adjusted EBITDA as interest can vary significantly among companies depending on a company's level of income generating instruments and/or level of debt.

Stock compensation expense:  Stock-based compensation is generally fixed at the time the stock-based instrument is granted and amortized over a period of several years.  The value of stock options is determined using a complex formula that incorporates factors, such as market volatility, that are beyond our control.  The value of our restricted stock awards is determined using the grant date stock price, which may not be indicative of our operational performance over the expense period.  Additionally, in order to establish the fair value of performance-based stock awards, which are currently an element of our ongoing stock-based compensation, we are required to apply judgment to estimate the probability of the extent to which performance objectives will be achieved.  Based on the above factors, we believe it is useful to exclude stock-based compensation in order to better understand our operating performance.

Intangible asset amortization expense:  We do not acquire businesses or capitalize certain patent costs on a predictable cycle.  The amount of purchase price allocated to intangible assets and the term of amortization can vary significantly and are unique to each acquisition.  Capitalized patent costs can vary significantly based on our current level of development activities.  We believe that excluding amortization of intangible assets provides the users of our financial statements with a consistent basis for comparison across accounting periods.

Depreciation expense:  We exclude depreciation expense in deriving adjusted EBITDA because companies utilize productive assets of different ages and the depreciable lives can vary significantly resulting in considerable variability in depreciation expense among companies.

Restructuring, strategic transaction and integration:  We incur restructuring and strategic transaction charges that result from events, which arise from unforeseen circumstances and/or often occur outside of the ordinary course of our ongoing business.  Although these events are reflected in our GAAP financial statements, these unique transactions may limit the comparability of our ongoing operations with prior and future periods.

Adjustment to reverse the cost recognition related to the purchase accounting write-up of inventory to fair market value: The inventory step-up represents the expense recognition of fair value adjustments in excess of the historical cost basis of inventory obtained through acquisition, these charges are outside of our normal operations and are excluded.

Legal settlement:  Occasionally, we are involved in legal proceedings that may result in one-time settlements. We exclude these settlements as they have no direct correlation to the operation of our ongoing business.

Bargain purchase gain:  We may incur a bargain purchase gain on certain acquisitions if the fair market value of the identifiable assets acquired and liabilities assumed, net of deferred taxes exceeds the total consideration paid.  We exclude such gains as they are related to acquisitions and have no direct correlation to the operation of our ongoing business.

Change in fair value of earn-out:  We exclude the impact of certain amounts recorded in connection with business combinations.  We exclude items that are either non-cash or not normal, recurring operating expenses due to their nature, variability of amounts, and lack of predictability as to occurrence and/or timing.

Disposition of certain assets:  Occasionally, we may dispose of certain assets if no longer needed for current operations. We exclude any gains or losses recognized on the sale of these assets in determining our non-GAAP financial measures as they may limit the comparability of our ongoing operations with prior and future periods and distort the evaluation of our normal operating performance.

 Adjusted Diluted EPS excludes from diluted EPS, net of tax, interest, net, intangible asset amortization expense, stock compensation expense, restructuring and strategic transaction, adjustment to reverse the cost recognition related to the purchase accounting write-up of inventory to fair market value, legal settlement, disposition of certain assets, change in fair value of earn-out and bargain purchase gain, which was tax free.  We apply our GAAP consolidated effective tax rate to our non-GAAP financial measures, other than when the underlying item has a materially different tax treatment.

From time to time in the future, there may be other items that we may exclude if we believe that doing so is consistent with the goal of providing useful information to investors and management.

The following tables reconcile our GAAP and non-GAAP financial measures:


ICU MEDICAL, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)
(In thousands)

     
     Adjusted net sales
    Nine months ended
September 30, 2017
    Infusion
 Consumables
  IV
Solutions
  Infusion
Systems
  Critical
Care
  Other   Total
 GAAP net sales   $ 245,885     $ 375,494     $ 202,590     $ 37,221     $ 61,299     $ 922,489  
                         
 Non-GAAP adjustments:                        
Contract manufacturing       (51,868 )               (51,868 )
ICU intercompany sales to the HIS business   44,903                     44,903  
Non-GAAP net sales   $ 290,788     $ 323,626     $ 202,590     $ 37,221     $ 61,299     $ 915,524  
                         
     Adjusted net sales
    Nine months ended
September 30, 2016 
    Infusion
 Consumables
  IV
Solutions
  Infusion
Systems
  Critical
Care
  Other   Total
 GAAP net sales   $ 242,732     $     $     $ 40,291     $ 661     $ 283,684  
                         
 Non-GAAP adjustments:                        
Contract manufacturing                        
ICU intercompany sales to the HIS business                        
Non-GAAP net sales   $ 242,732     $     $     $ 40,291     $ 661     $ 283,684  
                         
     Adjusted net sales
    Three months ended
September 30, 2017 
    Infusion
 Consumables
  IV
Solutions
  Infusion
Systems
  Critical
Care
  Other   Total
 GAAP net sales   $ 92,612     $ 143,710     $ 82,798     $ 12,950     $ 11,166     $ 343,236  
                         
 Non-GAAP adjustments:                        
Contract manufacturing       (16,164 )               (16,164 )
ICU intercompany sales to the HIS business   7,484                     7,484  
Non-GAAP net sales   $ 100,096     $ 127,546     $ 82,798     $ 12,950     $ 11,166     $ 334,556  
                         
     Adjusted net sales
    Three months ended
September 30, 2016
    Infusion
 Consumables
  IV
Solutions
  Infusion
Systems
  Critical
Care
  Other   Total
 GAAP net sales   $ 82,825     $     $     $ 14,047     $ 236     $ 97,108  
                         
 Non-GAAP adjustments:                        
Contract manufacturing                        
ICU intercompany sales to the HIS business                        
Non-GAAP net sales   $ 82,825     $     $     $ 14,047     $ 236     $ 97,108  
                                                 


ICU MEDICAL, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited) (Continued)
(In thousands, except per share data)

       
  Adjusted gross profit   Adjusted gross profit
  Three months ended
September 30,
  Nine months ended
September 30,
  2017   2016   2017   2016
 GAAP gross profit $ 111,598     $ 51,273     $ 288,605     $ 150,638  
               
 Non-GAAP adjustments:              
Adjustment to reverse the cost recognition related to the purchase accounting
write-up of inventory to fair market value
11,180         66,313      
Non-GAAP gross profit $ 122,778     $ 51,273     $ 354,918     $ 150,638  
GAAP gross profit % GAAP net sales 33 %   53 %   31 %   53 %
Non-GAAP gross profit % Non-GAAP net sales 37 %   53 %   39 %   53 %
                       


ICU MEDICAL, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited) (Continued)
(In thousands, except per share data)

       
   Adjusted EBITDA    Adjusted EBITDA
  Three months ended
September 30,
  Nine months ended
September 30,
  2017   2016   2017   2016
 GAAP net income $ 136     $ 18,806     $ 18,939     $ 53,572  
               
 Non-GAAP adjustments:              
Interest, net 123         858      
Stock compensation expense 4,582     3,790     13,387     11,464  
Depreciation and amortization expense 17,606     4,703     47,512     14,351  
Restructuring, strategic transaction and integration 18,711     2,806     68,033     4,339  
Adjustment to reverse the cost recognition related to the purchase accounting
write-up of inventory to fair market value
11,180         66,313      
Legal settlement         809      
Bargain purchase gain (8,534 )   (346 )   (71,771 )   (1,456 )
Change in fair value of earn-out 7,000         13,000      
Disposition of certain assets         2,880      
Provision for income taxes 4,574     4,220     (7,558 )   17,503  
  Total non-GAAP adjustments 55,242     15,173     133,463     46,201  
               
 Adjusted EBITDA $ 55,378     $ 33,979     $ 152,402     $ 99,773  
               
   Adjusted diluted earnings per share    Adjusted diluted earnings per share
  Three months ended
September 30,
  Nine months ended
September 30,
  2017   2016   2017   2016
 GAAP diluted earnings per share $ 0.01     $ 1.09     $ 0.92     $ 3.13  
               
 Non-GAAP adjustments:              
Interest, net $ 0.01     $     $ 0.04     $  
Stock compensation expense $ 0.22     $ 0.22     $ 0.65     $ 0.67  
Amortization expense $ 0.17     $ 0.04     $ 0.53     $ 0.12  
Restructuring, strategic transaction and integration $ 0.89     $ 0.16     $ 3.30     $ 0.25  
Adjustment to reverse the cost recognition related to the purchase accounting
write-up of inventory to fair market value
$ 0.53     $     $ 3.22     $  
Legal settlement $         $ 0.04     $  
Bargain purchase gain $ (0.40 )   $ (0.02 )   $ (3.48 )   $ (0.09 )
Change in fair value of earn-out $ 0.33     $     $ 0.63     $  
Disposition of certain assets $     $     $ 0.14     $  
Estimated income tax impact from adjustments $ (0.64 )   $ (0.14 )   $ (2.52 )   $ (0.36 )
 Adjusted diluted earnings per share $ 1.12     $ 1.35     $ 3.47     $ 3.72  
                               


ICU MEDICAL, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Financial Measures - Fiscal Year 2017 Outlook (Unaudited)
(In millions, except per share data)

       
  Low End of Guidance   High End of Guidance
 GAAP net income $ 9     $ 21  
       
 Non-GAAP adjustments:      
Interest, net 2     2  
Stock compensation expense 18     18  
Depreciation and amortization expense 65     65  
Restructuring, strategic transaction and integration 95     95  
Adjustment to reverse the cost recognition related to the purchase accounting
write-up of inventory to fair market value
66     66  
Legal settlement 1     1  
Bargain purchase gain (72 )   (72 )
Disposition of certain assets 3     3  
Change in fair value of earn-out 13     13  
Provision for income taxes (5 )   (7 )
  Total non-GAAP adjustments 186     184  
       
 Adjusted EBITDA $ 195     $ 205  
       
       
       
       
 GAAP diluted earnings per share $ 0.41     $ 1.01  
       
 Non-GAAP adjustments:      
Interest, net $ 0.10     $ 0.10  
Stock compensation expense $ 0.87     $ 0.87  
Amortization expense $ 0.72     $ 0.72  
Restructuring, strategic transaction and integration $ 4.61     $ 4.61  
Adjustment to reverse the cost recognition related to the purchase accounting
write-up of inventory to fair market value
$ 3.22     $ 3.22  
Legal settlement $ 0.04     $ 0.04  
Bargain purchase gain $ (3.49 )   $ (3.49 )
Change in value of earn-out $ 0.63     $ 0.63  
Disposition of certain assets $ 0.14     $ 0.14  
Estimated income tax impact from adjustments $ (3.05 )   $ (3.05 )
 Adjusted diluted earnings per share $ 4.20     $ 4.80  
               


ICU Medical, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Measures - Fiscal Year 2018 Outlook (Unaudited)
(In millions, except per share data)

       
  Low End of Guidance   High End of Guidance
 GAAP net income $ 70     $ 83  
       
 Non-GAAP adjustments:      
  Stock compensation expense 17     17  
  Depreciation and amortization expense 76     76  
Restructuring, strategic transaction and integration 50     50  
  Provision for income taxes 27     34  
  Total non-GAAP adjustments 170     177  
       
 Adjusted EBITDA $ 240     $ 260  
       
       
       
       
 GAAP diluted earnings per share $ 3.27     $ 3.87  
       
 Non-GAAP adjustments:      
  Stock compensation expense $ 0.80     $ 0.80  
  Amortization expense $ 0.75     $ 0.75  
Restructuring, strategic transaction and integration $ 2.34     $ 2.34  
  Estimated income tax impact from adjustments $ (1.11 )   $ (1.11 )
 Adjusted diluted earnings per share $ 6.05     $ 6.65  
               

CONTACT:
ICU Medical, Inc.
Scott Lamb, Chief Financial Officer
(949) 366-2183

ICR, Inc.
John Mills, Partner
(646) 277-1254

 

Source: ICU Medical, Inc.