cnmd-20230331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the quarterly period ended			Commission File Number
March 31, 2023			001-39218

CONMED CORPORATION

(Exact name of the registrant as specified in its charter)


Delaware			16-0977505
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

11311 Concept Blvd	Largo,	Florida	33773
(Address of principal executive offices)			(Zip Code)

(727) 392-6464

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $0.01 par value	CNMD	NYSE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act (Check one).

Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐

Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

The number of shares outstanding of registrant's common stock, as of April 24, 2023 is 30,575,290 shares.

CONMED CORPORATION

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED MARCH 31, 2023


PART I FINANCIAL INFORMATION
Item Number		Page

Item 1.	Financial Statements (unaudited)

	– Consolidated Condensed Statements of Comprehensive Income for the three months ended March 31, 2023 and 2022	1

	– Consolidated Condensed Balance Sheets as of March 31, 2023 and December 31, 2022	2

	– Consolidated Condensed Statements of Shareholders' Equity for the three months ended March 31, 2023 and 2022	3

	– Consolidated Condensed Statements of Cash Flows for the three months ended March 31, 2023 and 2022	4

	– Notes to Consolidated Condensed Financial Statements	5


Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	19

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25

Item 4.	Controls and Procedures	25

PART II OTHER INFORMATION

Item 1.	Legal Proceedings	25

Item 6.	Exhibits	26


Signatures		27

Table of Contents

PART I FINANCIAL INFORMATION

Item 1.

CONMED CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited, in thousands except per share amounts)


	Three Months Ended
	March 31,
	2023		2022
Net sales	$	295,468	$	242,327

Cost of sales	140,147		106,336

Gross profit	155,321		135,991

Selling and administrative expense	130,083		102,875

Research and development expense	12,539		10,672

Operating expenses	142,622		113,547

Income from operations	12,699		22,444

Interest expense	10,255		4,998



Income before income taxes	2,444		17,446

Provision for income taxes	625		2,471

Net income	$	1,819	$	14,975

Comprehensive income	$	4,695	$	16,415


Per share data:

Net income
Basic	$	0.06	$	0.51
Diluted	0.06		0.47

Weighted average common shares
Basic	30,511		29,428
Diluted	31,204		35,155

See notes to consolidated condensed financial statements.

Table of Contents

CONMED CORPORATION

CONSOLIDATED CONDENSED BALANCE SHEETS

(Unaudited, in thousands except share and per share amounts)


	March 31, 2023		December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	26,494	$	28,942
Accounts receivable, net	213,182		191,345
Inventories	335,370		332,320
Prepaid expenses and other current assets	35,042		28,619
Total current assets	610,088		581,226
Property, plant and equipment, net	115,356		115,611
Goodwill	815,499		815,429
Other intangible assets, net	673,538		681,799
Other assets	105,639		103,527
Total assets	$	2,320,120	$	2,297,592




LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	69,693	$	69,746
Accounts payable	76,680		73,393
Accrued compensation and benefits	49,378		54,733
Other current liabilities	124,935		98,680
Total current liabilities	320,686		296,552

Long-term debt	995,276		985,076
Deferred income taxes	65,546		66,725
Other long-term liabilities	186,159		203,694
Total liabilities	1,567,667		1,552,047

Commitments and contingencies

Shareholders' equity:
Preferred stock, par value $0.01 per share;
authorized 500,000 shares; none outstanding	—		—
Common stock, par value $0.01 per share; 100,000,000 shares authorized; 31,299,194 shares issued in 2023 and 2022, respectively	313		313
Paid-in capital	419,517		413,235
Retained earnings	408,337		412,631
Accumulated other comprehensive loss	(54,982)		(57,858)
Less: 738,718 and 811,532 shares of common stock in treasury, at cost, in 2023 and 2022, respectively	(20,732)		(22,776)
Total shareholders’ equity	752,453		745,545
Total liabilities and shareholders’ equity	$	2,320,120	$	2,297,592

See notes to consolidated condensed financial statements.

Table of Contents

CONMED CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF SHAREHOLDERS' EQUITY

(Unaudited, in thousands except per share amounts)


	Common Stock			Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Shareholders’ Equity
	Shares	Amount
Balance at December 31, 2022	31,299	$	313	$	413,235	$	412,631	$	(57,858)	$	(22,776)	$	745,545
Common stock issued under employee plans				556						2,044		2,600
Stock-based compensation				5,726								5,726
Dividends on common stock ($0.20 per share)						(6,113)						(6,113)



Comprehensive income:
Cash flow hedging gain, net								877
Pension liability, net								403
Foreign currency translation adjustments								1,596
Net income

SEC Form 10-Q filed by CONMED Corporation