What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-12-06 compared with 2023-12-08 · 251 added, 245 removed, 889 unchanged (36% of the section changed)

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The Cooper Companies, Inc.:

Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of The Cooper Companies, Inc.

and subsidiaries (the Company) as of October 31, 2023 and 2022, the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended October 31, 2023, and the related notes and financial statement Schedule II (collectively, the consolidated financial statements).

We also have audited the Company’s internal control over financial reporting as of October 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of October 31, 2023 and 2022, and the results of its operations and its cash flows for each of the years in the three-year period ended October 31, 2023, in conformity with U.S.

and subsidiaries (the Company) as of October 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended October 31, 2024, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of October 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years in the three-year period ended October 31, 2024, in conformity with U.S.

generally accepted accounting principles.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of October 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting.

Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of October 31, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated December 6, 2024 expressed an adverse opinion on the effectiveness of the Company's internal control over financial reporting.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audits also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

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This included determining the locations for which procedures were performed.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

The following are the primary procedures we performed to address this critical audit matter.

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Diluted 200.4 199.3 198.8

* All periods presented have been adjusted to reflect the four -for-one stock split effected on February 16, 2024.

Refer to Note 1.

Organization and Significant Accounting Policies for further information.

The accompanying notes are an integral part of these Consolidated Financial Statements.

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Other comprehensive income (loss) 32.1 13.0 ( 125.5 )

13.0 ( 125.5 ) 130.7

Comprehensive income $ 424.4 $ 307.2 $ 260.3

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Stockholders’ equity*:

Preferred stock, $ 10 cents par value, 1.0 shares authorized, zero shares issued or outstanding

Common stock, $ 10 cents par value, 120.0 shares authorized, 53.9 issued and 49.5 outstanding at October 31, 2023 and 53.8 issued and 49.3 outstanding at October 31, 2022

Preferred stock, $ 0.10 par value, 1.0 shares authorized, zero shares issued or outstanding

Common stock, $ 0.10 par value, 480.0 shares authorized, 217.2 issued and 199.6 outstanding at October 31, 2024 and 215.8 issued and 198.1 outstanding at October 31, 2023

Additional paid-in capital 1,921.0 1,817.2

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Total liabilities and stockholders’ equity $ 12,315.2 $ 11,658.9

* All periods presented have been adjusted to reflect the four -for-one stock split effected on February 16, 2024.

Refer to Note 1.

Organization and Significant Accounting Policies for further information.

The accompanying notes are an integral part of these Consolidated Financial Statements.

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Stockholders'

(In millions) Shares Amount Shares Amount

(In millions, except per share amounts) Shares Amount Shares Amount

Balance at October 31, 2021* 197.2 $ 19.7 17.6 $ 1.8 $ 1,699.1 $ ( 341.3 ) $ 6,202.1 $ ( 639.6 ) $ 0.2 $ 6,942.0

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Share-based compensation expense — — — — 52.4 — — — — 52.4

ASU 2016-13 adoption — — — — — — ( 1.4 ) — — ( 1.4 )

Balance at October 31, 2022* 197.4 $ 19.7 17.8 $ 1.8 $ 1,749.4 $ ( 466.8 ) $ 6,584.9 $ ( 714.5 ) $ 0.2 $ 7,174.7

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Issuance of common stock for stock plans, net and employee stock purchase plan 0.7 0.1 ( 0.1 ) — 7.0 — — 4.2 — 11.3

Treasury stock repurchase ( 0.1 ) — 0.1 — — — — ( 78.5 ) — ( 78.5 )

Dividends on common stock ($ 0.01 per share)

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Issuance of common stock for stock plans, net and employee stock purchase plan 1.5 0.1 ( 0.1 ) — 31.3 — — 4.3 — 35.7

Dividends on common stock ($ 0.03 per share)

— — — — — — ( 3.0 ) — — ( 3.0 )

Share-based compensation expense — — — — 72.5 — — — — 72.5

Balance at October 31, 2024* 199.6 $ 19.9 17.6 $ 1.8 $ 1,921.0 $ ( 421.7 ) $ 7,268.4 $ ( 706.0 ) $ 0.2 $ 8,083.6

* All periods presented have been adjusted to reflect the four -for-one stock split effected on February 16, 2024.

Refer to Note 1.

Organization and Significant Accounting Policies for further information .

The accompanying notes are an integral part of these Consolidated Financial Statements.

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Non-cash operating lease expense 38.7 40.0 32.2

Asset impairment charges, and other 49.4 4.5 ( 5.0 )

Other including asset impairment charges 42.9 49.4 4.5

Change in fair value of contingent consideration — ( 31.8 ) ( 10.3 )

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Purchases of property, plant and equipment ( 421.2 ) ( 392.5 ) ( 242.0 )

Acquisitions of businesses and assets, net of cash acquired ( 56.5 ) ( 1,641.3 ) ( 235.9 )

Acquisitions of businesses and assets, net of cash acquired, and other ( 343.4 ) ( 56.5 ) ( 1,641.3 )

Proceeds from sale of interest in a subsidiary — — 52.1

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Settlement of contingent consideration — — ( 2.9 )

Net cash (used in) provided by financing activities ( 173.9 ) 1,193.7 ( 311.4 )

Net cash provided (used in) by financing activities 39.2 ( 173.9 ) 1,193.7

Effect of exchange rate changes on cash, cash equivalents and restricted cash 2.9 ( 2.3 ) ( 12.9 )

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Cash, cash equivalents and restricted cash at end of year $ 107.7 $ 120.9 $ 138.6

Years Ended October 31,

(In millions)

2023 2022 2021

Supplemental disclosures of cash flow information:

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Income taxes 78.4 67.8 66.6

Years Ended October 31,

(In millions)

2024 2023 2022

Operating lease liabilities 48.0 47.5 45.3

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(Cooper, we or the Company) is a global medical device company publicly traded on the Nasdaq (Nasdaq:

Prior to September 26, 2023, Cooper's common stock traded on the New York Stock Exchange under the symbol "COO".

Cooper operates through two business units, CooperVision and CooperSurgical.

• CooperVision primarily develops, manufactures and markets a broad range of soft contact lenses for the worldwide vision correction market.

• CooperSurgical primarily develops, manufactures, markets medical devices and procedures solutions, and provides services to improve health care delivery to women, babies and families.

• CooperSurgical primarily develops, manufactures, markets medical devices and procedures solutions, and provides services to improve fertility and women's health care market.

Principles of Consolidation

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As part of its consideration of the contract, the Company evaluates certain factors including the customer’s ability to pay (or credit risk).

For each contract, the Company considers the promise to transfer products, each of which is distinct, to be the identified performance obligations.

For each contract, the Company considers the promise to transfer products or render services, each of which is distinct, to be the identified performance obligations.

The consideration in the contract is allocated among the identified performance obligations based on a relative standalone selling price basis.

The standalone selling price for each performance obligation is derived from the actual selling price or estimated using historical data or publicly available information.

Revenues from product sales are recognized when the Customer obtains control of the Company’s product, which occurs at a point in time, typically upon shipment or delivery to the Customer.

Taxes collected from Customers relating to product sales and remitted to governmental authorities are excluded from revenues.

Revenues from service sales are recognized when services are rendered, whether at a point in time or based on the passage of time depending on the type of services.

Stem cell revenue, which includes the initial processing service and ongoing storage service, accounts for the majority of our service revenues.

Revenue allocated to the processing service is recognized at a point in time when the cord blood and/or cord tissue is processed and deemed ready for storage.

Revenue allocated to storage service is recognized ratably over the terms of the storage contracts, which vary in length.

The majority of the contracts have a term of one year or 18 years.

Deferred revenue primarily represents prepaid stem cell storage as part of the CooperSurgical business unit.

The current portion of the deferred revenue balances at the beginning of each year presented were generally fully recognized in a ratable manner in the subsequent 12-month period.

We recognized revenue of approximately $ 123.6 million and $ 93.6 million for the year ended October 31, 2024, and October 31, 2023, respectively, that was included in the deferred revenue balance at October 31, 2023, and October 31, 2022.

Taxes collected from Customers and remitted to governmental authorities are excluded from revenues.

The Company expenses incremental costs of obtaining a contract as and when incurred if the expected amortization period of the asset that the Company would have recognized is one year or less.

Business Segment Information for disaggregation of revenue.

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AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Reserves for Variable Consideration

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Once the Company elects one of the methods to estimate variable consideration for a particular type of performance obligation, the Company applies that method consistently.

Where appropriate, these estimates take into consideration a range of possible outcomes which are probability-weighted for relevant factors such as the Company’s historical experience, current contractual and statutory requirements, specific known

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

market events and trends, industry data and forecasted customer buying and payment patterns.

Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the contract.

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CooperSurgical rebates are predominately related to the Medicaid rebate provision that is estimated based upon contractual terms, historical experience, and trend analysis.

Contract Liabilities

Deferred revenue primarily represents prepaid stem cell storage as part of the CooperSurgical business unit.

Revenue related to stem cell storage is recognized over the service period, which can range from one year to the lifetime of a customer.

The current portion of the deferred revenue balances at the beginning of each year presented were generally fully recognized in the subsequent 12-month period.

Share-Based Compensation

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Forfeitures are estimated at the time of grant, based on historical experience, and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Foreign Currency Translation

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We record gains and losses from changes in exchange rates on transactions denominated in currencies other than each reporting location's functional currency in net income for each period .

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Financial Derivatives and Hedging

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Deferred tax assets are reduced by a valuation allowance to the extent it is more likely than not they are not expected to be realized.

Adjustments to deferred tax assets and liabilities due to changes in tax laws, changes in jurisdiction from intra-group transfers of assets, and changes in judgment regarding a valuation allowance are recognized in provision for income taxes in the quarter in which such changes occur.

Adjustments to deferred tax assets and liabilities due to changes in tax laws, changes in jurisdiction from intra-entity transfers of assets, and changes in judgment regarding a valuation allowance are recognized in provision for income taxes in the quarter in which such changes occur.

Long-term tax payable is estimated income tax to be paid for unrecognized tax benefits.

A tax benefit is recognized if it is more likely than not a tax position will be sustained based on its technical merits in a tax authority examination, based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority.

Adjustments to unrecognized tax benefits due to changes in judgment are recognized in provision for income taxes in the quarter in which such changes occur.

Interest and penalties related to unrecognized tax benefits are recognized in provision for income taxes.

A tax benefit

THE COOPER COMPANIES, INC.

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Notes to Consolidated Financial Statements

is recognized if it is more likely than not a tax position will be sustained based on its technical merits in a tax authority examination, based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority.

Adjustments to unrecognized tax benefits due to changes in judgment are recognized in provision for income taxes in the quarter in which such changes occur.

Interest and penalties related to unrecognized tax benefits are recognized in provision for income taxes.

Income taxes include U.S.

tax on foreign earnings, which is primarily due to the global intangible low-taxed income (GILTI) provision of the U.S.

Tax Cuts and Jobs Act of 2017.

An accounting policy choice was allowed to treat GILTI temporary differences in taxable income either as a current-period expense (period cost method) or factor such amounts into the measurement of deferred taxes (deferral method).

We chose the period cost method.

Earnings Per Share

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We determine diluted EPS by increasing the weighted-average number of shares outstanding in the denominator by the number of outstanding dilutive equity awards using the treasury stock method.

On February 16, 2024, the Company effected a four -for-one stock split of its outstanding shares of common stock.

The par value of the common stock remains at $ 0.10 per share.

Accordingly, an amount equal to the par value of the increased shares resulting from the stock split was reclassified from "Additional paid-in capital" to "Common stock".

All share and per share information has been retroactively adjusted to reflect the stock split for all periods presented.

Cash and Cash Equivalents

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We charge maintenance and repairs to expense as we incur them.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(In millions)

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The Company primarily has operating leases for office, manufacturing and warehouse space, vehicles, and office equipment.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Lease right-of-use assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make payments arising from the lease agreement.

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Goodwill is tested for impairment at the reporting unit level by performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value.

We perform a qualitative assessment to test each reporting unit's goodwill for impairment, which includes industry and market considerations, overall financial performance and other relevant events and factors affecting each reporting unit.

We perform a qualitative assessment to test each reporting unit's goodwill for impairment, which

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

includes industry and market considerations, overall financial performance and other relevant events and factors affecting each reporting unit.

Based on our qualitative assessment, if we determine that the fair value of a reporting unit is more likely than not to be less than its carrying amount, the fair value of a reporting unit will be compared with its carrying amount and an impairment charge will be recognized for the amount that the carrying value exceeds the fair value of the reporting unit.

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Business Combinations

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

We routinely consummate business combinations.

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We record treasury stock purchases under the cost method whereby the entire cost of the acquired stock is recorded as treasury stock.

During the second quarter of fiscal 2022, the Company initiated a plan to exit its contact lens care business, a non-core business unit of the CooperVision segment, which was completed in fiscal 2023.

Exit charges recognized during the year ended October 31, 2023, were not material.

Exit charges recognized during the year ended October 31, 2022, were $ 33.2 million, of which $ 26.7 million were recognized in "Cost of sales" and $ 6.5 million were recognized in "Selling, general and administrative expense" in our Consolidated Statements of Income.

Exit charges primarily related to inventory write-down, asset impairments and employee-related costs.

Government Assistance

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The Company generally accounts for such government assistance by analogy to IAS 20, Accounting for Government Grants and Disclosure of Government Assistance and recognizes the assistance when it is probable that it will be received by complying with the prerequisite terms and conditions.

The government assistance is recognized in income as a reduction to the cost basis of the applicable property, plant, and equipment or reduction to the related expense.

Accounting Pronouncements Recently Adopted

In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832):

Disclosures by Business Entities about Government Assistance .

This update requires annual disclosures about transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy.

This standard was effective for fiscal years beginning after December 15, 2021.

The Company adopted this guidance prospectively on November 1, 2022, and such adoption did not have a material impact on the Company's Consolidated Financial Statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform ( Topic 848 ):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting and subsequent amendment to the initial guidance:

ASU 2021-01, Reference Rate Reform (Topic 848):

Scope (collectively, “Topic 848”).

Topic 848 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met.

The amendments apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform.

In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848):

Deferral of the Sunset Date of Topic 848 .

ASU 2022-06 defers the sunset date of Topic 848 from December 31, 2022, to December 31, 2024.

Effective February 1, 2023, the Company transitioned its credit agreements from LIBOR to the Secured Overnight Financing Rate ("SOFR").

The Company adopted this guidance prospectively on February 1, 2023, and it did not have a material impact on the Consolidated Financial Statements.

For the fiscal year ending October 31, 2024, government assistance of $ 32.5 million was recorded primarily as a reduction to the cost basis of property, plant, and equipment or reduction to the related expense.

Government assistance in prior fiscal years was immaterial.

Accounting Pronouncements Issued Not Yet Adopted

In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses , which requires additional disclosure of the nature of expenses included in the income statement.

The standard requires disclosures about specific types of expenses included in the expense captions presented in the income

THE COOPER COMPANIES, INC.

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Notes to Consolidated Financial Statements

Accounting Pronouncements Issued Not Yet Adopted

This ASU is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted.

The requirements should be applied on a prospective basis while retrospective application is permitted.

We are currently evaluating the impact that the adoption of this guidance will have on our disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

This ASU requires public entities to disclose specific categories in the effective tax rate reconciliation and additional information for reconciling items that exceed a quantitative threshold.

The guidance also requires all disaggregated information pertaining to taxes paid, net of refunds received, for federal, state and foreign income taxes.

The new guidance is effective for fiscal years beginning after December 15, 2024, with the option to apply prospectively or retrospectively.

Early adoption is permitted.

We are currently evaluating the impact that the adoption of this guidance will have on our consolidated financial statements and disclosures.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , which enhances the disclosures required for operating segments in our annual and interim consolidated financial statements.

The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, which means it will be effective from our fiscal year ended October 31, 2025, and interim periods within fiscal years beginning from November 01, 2025, and will be applied retrospectively.

Early adoption is permitted.

We are currently evaluating the impact of adopting this ASU on our consolidated financial statements and disclosures.

No other recently issued accounting pronouncements had or are expected to have a material impact on our Consolidated Financial Statements.

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The minimum rental payments required under operating leases that have initial or remaining noncancellable lease terms in excess of one year as of October 31, 2024, are:

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(In millions)

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Present value of lease liabilities $ 269.4

Excluded from the above table are additional leases to expand manufacturing as well as research and development capacity that have not yet commenced.

The undiscounted lease payments are estimated at $ 171 million for leases that will commence starting in fiscal 2025 with initial terms ranging from 20 to 25 years.

Acquisitions and Joint Venture

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Fiscal Year 2024

On November 1, 2022, CooperVision completed the acquisition of a privately-held U.S.-based company that provides a broad portfolio of technologically advanced contact lens products, including scleral and hybrid lenses.

On August 1, 2024, CooperSurgical completed the acquisition of obp Surgical, a U.S.-based medical device company with a suite of single-use cordless surgical retractors with integrated light source and evacuation channels.

The purchase price of the acquisition was $ 100.0 million.

Assets acquired primarily comprised of $ 12.6 million of customer relationship related intangibles,

THE COOPER COMPANIES, INC.

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Notes to Consolidated Financial Statements

$ 7.6 million of technology, $ 5.1 million of net assets and $ 7.7 million of goodwill.

Assets acquired consisted primarily of $ 45.6 million of developed technology, $ 8.5 million of customer relationships, $ 7.7 million of inventory, $ 5.4 million of other net assets, and $ 50.6 million of goodwill, which is primarily related to expected synergies from combined operations.

The Company is in the process of finalizing purchase accounting information.

The goodwill is not deductible for tax purposes.

On June 7, 2024, CooperSurgical acquired a fertility company that specializes in sperm separation devices.

The purchase price of the acquisition was $ 33.5 million.

The Company accounted for this acquisition as an asset acquisition, whereby the Company allocated the total cost of the acquisition to the net assets acquired on the basis of their estimated relative fair values on the acquisition date.

The primary asset acquired in this asset acquisition is a composite intangible asset of $ 39.6 million.

The value of the composite intangible asset reflects, in addition to the purchase price, a deferred tax liability of $ 8.3 million arising from book/tax basis differences generated upon the acquisition.

The composite intangible asset encompasses the portfolio of intellectual property associated with the sperm separation devices including the patents, trademarks, customer relationships, regulatory approvals, and commercialization rights, which have been valued as a single composite intangible asset as they are inextricably linked.

On November 1, 2023, CooperSurgical completed the acquisition of select Cook Medical assets focused primarily on the obstetrics, doppler monitoring, and gynecology surgery markets.

The purchase price of the acquisition was $ 300.0 million, with $ 200.0 million paid at closing and two cash payments of $ 50.0 million each to be paid on November 1, 2024, and November 1, 2025.

The present value of the acquisition purchase price was $ 291.6 million, which is included in the Company's balance sheet.

Assets acquired primarily comprised of $ 157.9 million of technologies, $ 26.6 million of customer relationship related intangibles, and $ 107.2 million of goodwill.

The goodwill is deductible for tax purposes.

Fiscal Year 2023

On May 31, 2022, CooperVision completed the acquisition of a privately-held Denmark-based contact lens distributor focusing on orthokeratology and scleral contact lenses.

This acquisition expands CooperVision's ortho-k eye care portfolio in the Nordic market.

On April 6, 2022, CooperSurgical completed the acquisition of a private cryopreservation services company that specializes in cryogenic services.

Refer to the "Joint Venture" section below for details on formation of a joint venture with Essilor International and related activities that occurred in fiscal year 2023 and 2022 following the acquisition of SightGlass Vision, Inc.

(SGV) in fiscal year 2021.

On April 6, 2022, CooperSurgical entered into an asset purchase agreement to acquire Cook Medical's Reproductive Health business, a manufacturer of minimally invasive medical devices focused on the fertility, obstetrics and gynecology markets.

The aggregate consideration is $ 875.0 million in cash, with $ 675.0 million payable at the closing and the remaining $ 200.0 million payable in $ 50.0 million installments following each of the first, second, third and fourth anniversaries of the closing.

The transaction is subject to customary closing conditions, such as receipt of required regulatory approvals.

During the year ended October 31, 2023, CooperSurgical determined that the fulfillment of certain closing conditions related to regulatory approvals was no longer probable and paid $ 45.0 million in expenses for a termination fee under the asset purchase agreement on August 9, 2023.

The termination fee is recorded in "Selling, general and administrative expense" on the Consolidated Statements of Income.

Refer to the "Subsequent Event" section below for details on the revised scope of the transaction and the closing of the updated transaction.

On December 17, 2021, CooperSurgical completed the acquisition of 100 % of the equity interests in Generate Life Sciences (Generate), a privately held leading provider of donor egg and sperm for fertility treatments, fertility cryopreservation services and newborn stem cell storage (cord blood & cord tissue), and paid an aggregate purchase consideration of approximately $ 1.663 billion, reflecting working capital, and other adjustments.

The cash consideration was funded through a combination of $ 1.5 billion in proceeds from the issuance of a senior unsecured term loan and available cash on hand.

Joint Venture

On January 19, 2021, CooperVision acquired all of the remaining equity interests of SGV, a privately-held medical device company that developed spectacle lenses for myopia management.

The transaction included potential payments of future consideration that were contingent upon the achievement of the regulatory approval milestone (the regulatory approval payment) and the acquired business reaching certain revenue thresholds over a specified period (the revenue payments).

The undiscounted range of the contingent consideration was zero to $ 139.1 million payable to the other former equity interest owners.

The fair value of the regulatory approval payment was determined using an option pricing framework based on the expected payment under the contractual terms and the estimates of the probability of achieving the regulatory approval.

The fair value of the revenue payments was determined using a Monte Carlo simulation based on the revenue projections and the expected payment for each simulation.

In March 2022, the entities amended the terms of the contingent consideration, which resulted in CooperVision paying $ 42.9 million to the former equity interest owners in exchange for the elimination of the revenue payments to such former equity interest owners.

CooperVision recognized a net gain of $ 12.2 million during fiscal 2022.

Further, CooperVision and Essilor International SAS (Essilor) executed a Contribution Agreement and a Stock Purchase Agreement (the "Agreements") in March 2022.

Essilor paid CooperVision $ 52.1 million in exchange for a 50 % interest in SGV and their proportionate share of the revenue payments.

As part of the Agreements, each party contributed their interest in SGV and $ 10 million in cash to form a new joint venture.

CooperVision then remeasured the fair value of its retained equity investment in the joint venture at $ 90.0 million which resulted in a $ 56.9 million gain in Other (income) expense on deconsolidation of SGV in fiscal 2022.

During fiscal 2023, CooperVision determined that approval would not be achieved within the timeline set forth in the contractual terms of the regulatory approval payment and released the remaining $ 31.8 million contingent consideration liability.

Subsequent Event

On November 1, 2023, CooperSurgical closed the acquisition of select assets of Cook Medical for an aggregate consideration of $ 300.0 million, with $ 200.0 million paid at closing and $ 100.0 million to be paid in two $ 50.0 million annual installments.

The purchase price of the acquisition was $ 33.0 million.

Assets acquired primarily comprised of $ 12.6 million of customer relationship related intangibles, $ 7.6 million of technology, $ 5.1 million of net assets and $ 7.7 million of goodwill.

The goodwill is not deductible for tax purposes.

Intangible Assets

THE COOPER COMPANIES, INC.

1 unchanged sentence

Notes to Consolidated Financial Statements

assets acquired primarily comprised of minimally invasive medical devices within the obstetrics, doppler monitoring and gynecology surgery markets.

The Company is in the process of finalizing purchase accounting information.

Intangible Assets

The Company has three reporting units:

4 unchanged sentences

$ 1,747.6 $ 1,876.9 $ 3,624.5

Net additions

— 157.8 157.8

Foreign currency translation adjustment 50.2 5.9 56.1

Balance at October 31, 2024

$ 1,797.8 $ 2,040.6 $ 3,838.4

Of the October 31, 2024, goodwill balance, $ 311.5 million for CooperSurgical and $ 17.8 million for CooperVision is expected to be deductible for tax purposes.

10 unchanged sentences

Trademarks $ 204.2 $ 90.6 $ 208.9 $ 81.1 15

Composite intangible asset 1,061.9 424.8 1,061.9 354.0 15

Composite intangible assets (1)

1,101.6 496.8 1,061.9 424.8 15

Technology 706.4 384.3 494.5 335.4 11

6 unchanged sentences

Total other intangibles, net $ 1,791.0 $ 1,710.3

(1) Composite intangible assets primarily consist of technology, trade name, New Drug Application approval and physician relationships.

The components are not reflected separately or within the corresponding categories because they are inextricably linked.

(2) Intangible assets with indefinite lives include technology and trademarks.

1 unchanged sentence

As of October 31, 2024, the estimate of future amortization expenses for intangible assets with definite lives is as follows:

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Fiscal years:

2 unchanged sentences

Total remaining amortization for intangible assets with definite lives $ 1,789.2

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

The Company performed its annual impairment assessment in the third quarter of fiscal 2024 and concluded there was no material impairment to the Company's definite-lived or indefinite-lived intangible assets during fiscal 2024.

In the fourth quarter of fiscal 2023, CooperVision fully impaired some intangible assets associated with the discontinuation of certain products.

The carrying value of these intangible assets were immaterial.

The Company performed its annual impairment assessment in the third quarter of fiscal 2023 and determined there was no other impairment to either its definite-lived or indefinite-lived intangible assets during fiscal 2023.

There were no impairment to the Company's definite-lived or indefinite-lived intangible assets during fiscal 2022 and 2021.

There was no impairment to the Company's definite-lived or indefinite-lived intangible assets during fiscal 2022.

Financing Arrangements

1 unchanged sentence

(In millions)

Overdraft and other credit facilities $ 44.4 $ 57.7

Term loans — 338.0

Short-term debt, excluding financing leases 32.2 44.4

10 unchanged sentences

As of October 31, 2024, the Company was in compliance with all debt covenants.

On February 1, 2023, the Company amended its credit agreements to transition the interest rates applicable to the loans denominated in U.S.

dollars from LIBOR to SOFR, as defined in the credit agreements.

Term Loan Agreement on December 17, 2021

On December 17, 2021, the Company entered into a Term Loan Agreement (the 2021 Credit Agreement) by and among the Company, the lenders from time to time party thereto, and PNC Bank, National Association, as administrative agent.

The 2021 Credit Agreement provides for a term loan facility (the 2021 Term Loan Facility) in an aggregate principal amount of $ 1.5 billion, which, unless terminated earlier, matures on December 17, 2026.

Revolving Credit Agreement on May 1, 2024

On May 1, 2024, the Company entered into a Revolving Credit Agreement (the 2024 Credit Agreement), among the Company, CooperVision International Limited, the lenders from time to time party thereto, and PNC Bank, National Association, as administrative agent.

The 2024 Credit Agreement provides for a multicurrency revolving credit facility (the 2024 Revolving Credit Facility) in an aggregate principal amount of $ 2.3 billion which, unless terminated earlier, matures on May 1, 2029.

On May 1, 2024, the Company used $ 1.2 billion under the 2024 Revolving Credit Facility to fully repay all borrowings outstanding under the 2020 Term Loan Facility and the 2020 Revolving Credit Facility, and terminated the 2020 Credit Agreement.

The Company has an uncommitted option to increase the revolving credit facility or establish a new term loan in an aggregate amount up to the greater of $ 1.2 billion or 100 % of consolidated Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), as defined in the 2024 Credit Agreement.

The 2024 Credit Agreement will bear interest, at the Company’s option, at either the base rate, or the adjusted SOFR, or adjusted foreign currency rate, plus, in each case, an applicable rate of between 0.00 % and 0.50 % in respect of base rate loans, and between 0.87 % and 1.50 % in respect of adjusted SOFR or adjusted foreign currency rate loans, in each case in accordance with a pricing grid tied to the Total Leverage Ratio, as defined in the 2024 Credit Agreement.

The Company pays an annual commitment fee that ranges from 0.10 % to 0.20 % of the unused portion of the 2024 Revolving Credit Facility based upon the Total Leverage Ratio, as defined in the 2024 Credit Agreement.

The 2024 Credit Agreement contains customary restrictive covenants, as well as financial covenants that require the Company to maintain a certain Total Leverage Ratio and Interest Coverage Ratio, each as defined in the 2024 Credit Agreement, consistent with the 2020 Credit Agreement discussed below.

On October 31, 2024, the Company had $ 1.0 billion outstanding under the 2024 Revolving Credit Facility and the weighted-average interest rate on the 2024 Revolving Credit Facility was 6.05 %.

THE COOPER COMPANIES, INC.

1 unchanged sentence

Notes to Consolidated Financial Statements

notice to the administrative agent and subject to the discretionary participation of the lenders funding such term loans and certain limitations set forth in the 2021 Credit Agreement.

Term Loan Agreement on December 17, 2021

In addition, the Company has the ability from time to time to request an increase to the commitments under the 2021 Term Loan Facility or to establish a new term loan facility under the 2021 Credit Agreement in an aggregate principal amount not to exceed $ 1.1 billion, upon prior written notice to the administrative agent and subject to the discretionary participation of the lenders funding such term loans and certain limitations set forth in the 2021 Credit Agreement.

Amounts outstanding under the 2021 Term Loan Facility will bear interest, at the Company’s option, at either (i) the alternate base rate, which is a rate per annum equal to the greatest of (a) the administrative agent’s prime rate, (b) one-half of one percent in excess of the federal funds effective rate and (c) one percent in excess of the adjusted SOFR for a one-month interest period in effect on such day, or (ii) the adjusted SOFR, plus, in each case, an applicable rate of, initially, zero basis points, in respect of base rate loans, and 75 basis points, in respect of adjusted SOFR loans.

1 unchanged sentence

The Company may prepay loan balances from time to time, in whole or in part, without premium or penalty (other than any related breakage costs).

On October 31, 2023, the Company had $ 1.5 billion outstanding on the 2021 Term Loan Facility and the weighted-average interest rate was 6.41 %.

On May 1, 2024, in connection with the Company's entry into the 2024 Credit Agreement, the Company entered into Amendment No.

2 to the 2021 Credit Agreement, modifying the 2021 Credit Agreement by, among other things, conforming certain provisions therein to those contained in the 2024 Credit Agreement.

On October 31, 2024, the Company had $ 1.5 billion outstanding under the 2021 Term Loan Facility and the interest rate was 5.94 %.

The 2021 Credit Agreement contains customary restrictive covenants, as well as financial covenants that require the Company to maintain a certain Total Leverage Ratio and Interest Coverage Ratio, each as defined in the 2021 Credit Agreement, consistent with the 2020 Credit Agreement discussed below.

Term Loan Agreement on November 2, 2021

On November 2, 2021, the Company entered into a 364 -day, $ 840.0 million, term loan agreement by and among the Company, the lenders party thereto and The Bank of Nova Scotia, as administrative agent, which matured subsequent to year end on November 1, 2022.

The Company used part of the funds to partially repay outstanding borrowings under the 2020 Revolving Credit Facility and for general corporate purposes.

The loan was fully repaid by the maturity date.

Revolving Credit and Term Loan Agreement on April 1, 2020

On April 1, 2020, the Company entered into a Revolving Credit and Term Loan Agreement (the 2020 Credit Agreement), among the Company, CooperVision International Holding Company, LP, CooperSurgical Netherlands B.V., CooperVision Holding Kft.

the lenders from time to time party thereto, and KeyBank National Association, as administrative agent.

On April 1, 2020, the Company entered into a Revolving Credit and Term Loan Agreement (the 2020 Credit Agreement), by and among the Company, CooperVision International Holding Company, LP, CooperSurgical Netherlands B.V., CooperVision Holding Kft., the lenders from time to time party thereto, and KeyBank National Association, as administrative agent.

The 2020 Credit Agreement provides for (a) a multicurrency revolving credit facility (the 2020 Revolving Credit Facility) in an aggregate principal amount of $ 1.3 billion and (b) a term loan facility (the 2020 Term Loan Facility) in an aggregate principal amount of $ 850.0 million, each of which, unless terminated earlier, mature on April 1, 2025.

The Company used $ 850.0 million under the 2020 Term Loan Facility and $ 445.0 million under the 2020 Revolving Credit Facility to fully repay all borrowings outstanding under a previously existing term loan agreement and transfer all letters of credit and borrowings outstanding under a previously existing credit agreement to the 2020 Credit Agreement.

The Company has an uncommitted option to increase the revolving credit facility or establish a new term loan in an aggregate amount up to $ 1.6 billion.

On October 30, 2020, the Company entered into Amendment No.

1 to the 2020 Credit Agreement, adding CooperVision International Limited as a revolving borrower and releasing certain borrowers in the 2020 Credit Agreement.

On December 17, 2021, the Company entered into Amendment No.2 to the 2020 Credit Agreement, modifying the 2020 Credit Agreement by, among other things, adding CooperSurgical Holdings Limited as a revolving borrower, releasing CooperVision Holding Kft as a borrower, and updating the benchmark replacement language in the 2020 Credit Agreement.

The 2020 Credit Agreement will bear interest, at the Company’s option, at either the alternate base rate, or the adjusted SOFR, or adjusted foreign currency rate, plus, in each case, an applicable rate of between 0.00 % and 0.50 % in respect of base rate loans, and between 0.75 % and 1.50 % in respect of adjusted SOFR or adjusted foreign currency rate loans, in each case in accordance with a pricing grid tied to the Total Leverage Ratio, as defined in the 2020 Credit Agreement.

The Company may borrow, repay and re-borrow amounts available under the Revolving Credit Facility, subject to voluntary reduction of the revolving commitment.

The Company pays an annual commitment fee that ranges from 0.10 % to 0.20 % of the unused portion of the 2020 Revolving Credit Facility based upon the Company’s Total Leverage Ratio, as defined in the 2020 Credit Agreement.

On October 31, 2023, the Company had $ 850.0 million outstanding under the 2020 Term Loan Facility and $ 172.6 million outstanding under the 2020 Revolving Credit Facility.

The interest rate on the 2020 Term Loan Facility was 6.41 % at October 31, 2023.

The weighted-average interest rate on the 2020 Revolving Credit Facility was 6.41 % at October 31, 2023.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Payments on the outstanding long-term debt balance of $ 850.0 million are due in the fiscal year ending October 31, 2025.

On May 1, 2024, in connection with the Company's entry into the 2024 Credit Agreement, the Company terminated the 2020 Credit Agreement.

In connection with the termination, all borrowings outstanding under the 2020 Credit Agreement were repaid.

European and Asian Pacific Credit Facilities

6 unchanged sentences

Each facility is supported by a continuing and unconditional guaranty.

In November 2020, the Company completed an intra-group transfer of certain intellectual property and related assets of CooperVision to a UK subsidiary as part of a group restructuring to establish headquarters operations in the UK.

Determining fair value involved significant judgment related to future revenue growth, operating margins, and discount rates.

The transfer resulted in a step-up of the UK tax-deductible basis in the intellectual property and goodwill, creating a temporary difference between the book basis and the tax basis of these assets.

As a result, the Company recognized a deferred tax asset of $ 1,987.9 million, with a corresponding income tax benefit, during the first quarter of fiscal 2021.

During the third quarter of fiscal 2021, the Company recognized a $ 536.7 million tax benefit related primarily to the remeasurement of this deferred tax asset caused by the UK enactment of a 25% corporate tax rate.

Components of income before income taxes:

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended October 31,

17 unchanged sentences

Provision for income taxes $ 190.0 $ 118.7 $ 89.5

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Reconciliation between the expected provision for income taxes at the US federal statutory rate and the provision for income taxes:

Reconciliation between the expected provision for income taxes at the U.S.

federal statutory rate and the provision for income taxes:

Years Ended October 31,

6 unchanged sentences

Excess tax benefits from share-based compensation ( 5.1 ) ( 2.4 ) ( 2.6 )

Intra-group transfer to UK subsidiary — — ( 1,987.8 )

Remeasurement of deferred tax assets from UK rate change — — ( 536.7 )

Change in unrecognized tax benefits 0.6 — ( 12.7 )

2 unchanged sentences

Provision for income taxes $ 190.0 $ 118.7 $ 89.5

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Components of deferred tax assets and liabilities:

2 unchanged sentences

Deferred tax assets:

Accounts receivable $ 7.5 $ 4.9

Inventories 14.3 6.3

Accrued liabilities, reserves and compensation accruals 94.8 79.9

Foreign deferred tax assets 2,369.5 2,500.5

Share-based compensation 14.8 14.5

Net operating loss and tax credit carryforwards 24.3 19.6

Capitalized research and experimental expenses 23.6 15.4

Inventory $ 43.0 $ 40.0

Employee compensation and benefits 34.2 31.9

Lease liabilities 43.0 37.5

Accrued liabilities 89.4 83.9

Net operating loss carryforwards 229.6 206.4

Foreign goodwill 1,129.5 1,249.5

Foreign intangible assets 817.9 857.6

Other deferred tax assets 59.5 48.2

Total gross deferred tax assets 2,446.1 2,555.0

2 unchanged sentences

Deferred tax liabilities:

Tax deductible goodwill ( 47.4 ) ( 39.7 )

Property, plant and equipment ( 51.7 ) ( 41.3 )

Right of use assets ( 40.6 ) ( 34.8 )

goodwill ( 44.5 ) ( 34.7 )

intangible assets ( 130.4 ) ( 121.3 )

Plant and equipment ( 51.2 ) ( 48.8 )

Foreign deferred tax liabilities ( 49.0 ) ( 45.5 )

Other deferred tax liabilities ( 41.3 ) ( 54.0 )

Total gross deferred tax liabilities ( 308.5 ) ( 286.1 )

Net deferred tax assets $ 2,114.3 $ 2,248.2

The Company has revised the presentation of the components of deferred tax assets and liabilities to disclose the amounts by type of asset or liability.

The amounts for fiscal 2023 were revised to reflect the presentation for fiscal 2024.

The revised table has no impact on the affected financial statement line items for the years affected or on any other tables.

Changes in valuation allowance:

Years Ended October 31,

(In millions)

2024 2023 2022

Beginning balance $ 20.7 $ 60.1 $ 51.8

Increases 2.8 2.6 13.3

Decreases ( 0.2 ) ( 42.0 ) ( 5.0 )

Ending balance 23.3 $ 20.7 $ 60.1

In assessing the realizability of deferred tax assets, the Company analyzes whether some or all deferred tax assets will not be realized.

This analysis considers historical taxable income, the projected reversal of deferred tax liabilities, projected taxable income and tax planning strategies.

Based upon this analysis, it is more likely than not the deferred tax assets, net of valuation allowance, will be realized.

The decrease in valuation allowance is primarily related to foreign tax attributes.

Based upon this analysis, it is more likely than not that the deferred tax assets, net of valuation allowance, will be realized.

At October 31, 2024, the Company had federal net operating loss carryforwards of $ 74.0 million and state net operating loss carryforwards of $ 85.0 million.

Federal net operating loss carryforwards of $ 46.0 million expire on various dates between 2024 and 2037 and $ 32.7 million do not expire.

The state net operating loss carryforwards expire on various dates between 2027 through 2044.

Federal net operating loss carryforwards of $ 24.2 million expire on various dates from fiscal 2026 through fiscal 2038 and $ 49.8 million do not expire.

The state net operating loss carryforwards expire on various dates from fiscal 2025 through fiscal 2044.

The remaining transition tax to be remitted from the U.S.

Tax Cuts and Jobs Act of 2017 is $ 66.4 million and $ 36.9 million as of October 31, 2024, and October 31, 2025, respectively.

THE COOPER COMPANIES, INC.

6 unchanged sentences

Decrease based on tax positions in prior fiscal years ( 0.5 )

Settlements ( 0.2 )

Increase based on tax positions in current fiscal year 2.0

Lapses of statutes of limitations ( 6.9 )

1 unchanged sentence

Decrease based on tax positions in prior fiscal years ( 2.0 )

Increase based on tax positions in prior fiscal years 2.2

Increase based on tax positions in current fiscal year 1.0

1 unchanged sentence

Balance at October 31, 2024 $ 326.8

These tax benefits, if recognized, would reduce provision for income taxes for 2023 , 2022 and 2021 , by $ 323.2 million, $ 324.3 million, and $ 336.5 million, respectively.

These tax benefits, if recognized, would reduce provision for income taxes for fiscal 2024, 2023 and 2022, by $ 323.7 million, $ 323.2 million, and $ 324.3 million, respectively.

Interest and penalties related to unrecognized tax benefits are recognized in provision for income taxes.

As of October 31, 2023, 2022 and 2021 , accrued gross interest and penalties related to unrecognized tax benefits was $ 5.8 million, $ 5.4 million, and $ 6.4 million, respectively.

At October 31, 2024, 2023 and 2022, accrued interest and penalties related to unrecognized tax benefits were $ 10.7 million, $ 5.8 million, and $ 5.4 million, respectively.

Included in the balance of unrecognized tax benefits at October 31, 2024, is $ 15.7 million related to tax positions for which it is reasonably possible that the total amounts could change during the next twelve months.

Filed tax returns are subject to examination by tax authorities in major tax jurisdictions after fiscal 2018, including the UK and the US.

Filed tax returns are subject to examination by tax authorities in major tax jurisdictions for fiscal 2018 and subsequent years, including the UK and the US.

Earnings Per Share

14 unchanged sentences

$ 75.03 - $ 101.54

Restricted stock units excluded 3 60 348

2 unchanged sentences

Notes to Consolidated Financial Statements

Above tables have been adjusted to reflect the four -for-one stock split effected on February 16, 2024.

Refer to Note 1.

Organization and Significant Accounting Policies for further information

Stockholders’ Equity

2 unchanged sentences

Balance at October 31, 2021

$ ( 320.3 ) $ 13.1 $ ( 34.1 ) $ ( 341.3 )

Gross change in value ( 234.7 ) 107.4 36.6 ( 90.7 )

1 unchanged sentence

Balance at October 31, 2022

$ ( 555.0 ) $ 94.4 $ ( 6.2 ) $ ( 466.8 )

Gross change in value $ 17.0 $ ( 9.4 ) $ 4.0 $ 11.6

1 unchanged sentence

Balance at October 31, 2023

$ ( 538.0 ) $ 87.4 $ ( 3.2 ) $ ( 453.8 )

Gross change in value $ 76.3 $ ( 55.9 ) $ ( 2.2 ) $ 18.2

1 unchanged sentence

Balance at October 31, 2024

$ ( 461.7 ) $ 44.9 $ ( 4.9 ) $ ( 421.7 )

Share Repurchases

In December 2011, the Company's Board of Directors authorized the 2012 Program and through subsequent amendments, the most recent in March 2017, the total repurchase authorization was increased from $ 500.0 million to $ 1.0 billion of the Company's common stock.

This program has no expiration date and may be discontinued at any time.

Purchases under the 2012 Program are subject to a review of the circumstances in place at the time and may be made from time to time as permitted by securities laws and other legal requirements.

As of October 31, 2023, $ 256.4 million remained authorized for repurchase under the program.

During the year ended October 31, 2023, there were no share repurchases under the 2012 Program.

During the year ended October 31, 2022, the Company repurchased 191.2 thousand shares of its common stock for $ 78.5 million, at an average purchase price of $ 410.41 per share.

In fiscal 2023 and 2022, the Company declared regular dividends of 6 cents per share (a semiannual dividend of 3 cents per share) and paid a total of $ 3.0 million in each fiscal year.

In December 2023, our Board of Directors decided to end the declaration of the semiannual dividend.

Subsequent Event

On December 7, 2023, we announced that our Board of Directors had approved a four -for-one stock split of our outstanding shares of common stock which we expect to be effected as of February 16, 2024.

In March 2017, the authorization under the 2012 Program was increased to $ 1.0 billion by the Company's Board of Directors.

As of October 31, 2024, $ 256.4 million remains authorized for repurchase.

During the year ended October 31, 2024, and October 31, 2023, there were no share repurchases.

In December 2023, the Company's Board of Directors decided to end the declaration of the semiannual dividend.

The Company paid dividends of approximately $ 3.0 million in each of fiscal 2023 and 2022.

All share, restricted stock unit (RSU), option, per share, per RSU and per option information presented below have been adjusted to reflect the four -for-one stock split effected on February 16, 2024.

Refer to Note 1.

Organization and Significant Accounting Policies.

2007 Long-Term Incentive Plan (2007 Plan)

1 unchanged sentence

The 2007 Plan was subsequently amended and restated, and granted stockholder approval in March 2009, March 2011, and March 2016.

The Third Amended and Restated 2007 Plan authorizes either our Board of Directors, or a designated committee thereof composed of two or more Non-Employee Directors, to grant to eligible individuals during the period ending December 31, 2026, up to 6,930,000 shares in the form of specified equity awards including stock options, restricted stock units and performance share awards.

The 2007 Plan authorizes either our Board of Directors, or a designated committee thereof composed of two or more non-employee directors, to grant to eligible individuals during the period ending December 31, 2026, up to 27,720,000 shares in the form of specified equity awards including stock options, restricted stock units and performance share awards.

RSUs have no dividend or voting rights prior to vesting.

1 unchanged sentence

2023 Long-Term Incentive Plan (2023 Plan)

In March 2023, we received stockholder approval of the 2023 Plan.

The 2023 Plan authorizes either our Board of Directors, or a designated committee thereof composed of two or more non-employee directors, to grant to eligible individuals up to 5,460,000 shares in the form of specified equity awards including stock options, restricted stock units (RSUs) and performance share units (PSUs), subject to adjustment for future stock splits, stock dividends, expirations, forfeitures, and similar events.

In addition, the

THE COOPER COMPANIES, INC.

1 unchanged sentence

Notes to Consolidated Financial Statements

In March 2023, we received stockholder approval of the 2023 Plan.

The 2023 Plan authorizes either our Board of Directors, or a designated committee thereof composed of two or more Non-Employee Directors, to grant to eligible individuals up to 1,365,000 shares in the form of specified equity awards including stock options, restricted stock units (RSUs) and performance share units (PSUs), subject to adjustment for future stock splits, stock dividends, expirations, forfeitures, and similar events.

In addition, the 2023 Plan includes any shares which were available for issuance under the 2007 Plan at the time of stockholder approval of this plan and shares which become available as a result of the forfeiture or expiration of awards made under the 2007 Plan.

2023 Plan includes any shares which were available for issuance under the 2007 Plan at the time of stockholder approval of this plan and shares which become available as a result of the forfeiture or expiration of awards made under the 2007 Plan.

As of October 31, 2024, 4,852,018 shares remained available under the 2023 Plan for future grants.

28 unchanged sentences

Vested and exercisable at October 31, 2024 2,507,860 $ 71.38 4.74 $ 83,521,576

The weighted-average fair value of options granted during fiscal 2023 , 2022 and 2021 , estimated as of the grant date using the Black-Scholes option pricing model, was $ 103.17 , $ 90.41 and $ 84.10 , respectively.

The weighted-average fair value of options granted during fiscal 2024, 2023 and 2022, estimated as of the grant date using the Black-Scholes option pricing model, was $ 26.54 , $ 25.79 and $ 22.60 .

The total intrinsic value of options exercised during the fiscal years ended October 31, 2024, 2023 and 2022 was $ 51.3 million, $ 13.4 million and $ 6.6 million, respectively.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Stock options outstanding under our current plans have been granted at prices which are either equal to or above the market value of the common stock on the date of grant.

1 unchanged sentence

We generally recognize compensation expense ratably over the vesting period.

As of October 31, 2023, there was $ 17.6 million of total unrecognized compensation cost related to nonvested options, which is expected to be recognized over a remaining weighted-average vesting period of 2.1 years.

As of October 31, 2024, there was $ 8.2 million of total unrecognized

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

compensation cost related to non-vested options, which is expected to be recognized over a remaining weighted-average vesting period of 1.7 years.

Restricted Stock Units

2 unchanged sentences

We recognize compensation expense ratably over the vesting period.

As of October 31, 2023, there was $ 63.1 million of total unrecognized compensation cost related to nonvested RSUs, which is expected to be recognized over a remaining weighted-average vesting period of 2.4 years.

As of October 31, 2024, there was $ 68.7 million of total unrecognized compensation cost related to non-vested RSUs, which is expected to be recognized over a remaining weighted-average vesting period of 2.5 years.

The total fair value of RSU grants that vested during the fiscal years ended October 31, 2024, 2023 and 2022 was $ 40.9 million, $ 37.3 million and $ 46.1 million, respectively.

27 unchanged sentences

Total ESPP share-based compensation recognized during fiscal 2024 and 2023 was $ 1.6 million and $ 1.3 million, respectively.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Employee Benefits

2 unchanged sentences

The Company's contributions are designed to fund normal cost on a current basis and to fund the estimated prior service cost of benefit improvements.

The unit credit actuarial cost method is used to determine the annual cost.

The unit credit actuarial cost method is used to determine the

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

The Company pays the entire cost of the Plan and funds such costs as they accrue.

2 unchanged sentences

The following table sets forth the Plan's benefit obligations and fair value of the Plan assets at October 31, 2024, 2023 and 2022 and the funded status of the Plan and net periodic pension costs for each of the years in the three-year periods ended October 31, 2024.

The net amounts recognized in the Consolidated Balance Sheets consist of noncurrent liabilities.

The net amounts recognized in the Consolidated Balance Sheets consist of non-current liabilities.

The accumulated benefit obligation was $ 161.7 million, $ 131.5 million and $ 134.9 million for the years ended October 31, 2024, 2023 and 2022.

23 unchanged sentences

Accumulated other comprehensive income $ 6.3 $ 4.1 $ 8.0

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended October 31,

6 unchanged sentences

(Prepaid)/Accrued pension cost at fiscal year end $ 8.9 $ 2.8 $ ( 2.9 )

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended October 31,

31 unchanged sentences

A change in the discount rate will cause the present value of benefit obligations to change in the opposite direction.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

The expected rate of return on plan assets was determined based on a review of historical returns, both for this plan and for medium- to large-sized defined benefit pension funds with similar asset allocations.

2 unchanged sentences

Reasons for Significant Liability Gains and Losses

The projected benefit obligation experienced a net gain of approximately $ 10.9 million during the year.

This net gain is the result of assumption changes resulting in a gain of approximately $ 12.9 million, offset by losses of approximately $ 2.0 million due to demographic experience.

The key assumption changes were the increase in the discount rate (gain of $ 7.8 million), a changes in assumptions for lump sum determination (gain of $ 5.1 million).

Demographic losses were due to the net effect of retirement rates, termination rates, salary increases and other experience that was different from assumed.

The projected benefit obligation experienced a net loss of approximately $ 26.4 million during the year.

This net loss is the result of assumption changes resulting in a loss of approximately $ 25.0 million and a loss of approximately $ 1.4 million due to demographic experience.

The key assumption changes were a decrease in the discount rate (loss of $ 14.5 million), change in assumptions for lump sum determination (loss of $ 8.8 million), an increase in expected future salaries (loss of $ 1.9 million), and

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

changes to decrements and payment timing following an experience review (gain of $ 0.2 million).

Changes in demographic experience were due to the net effect of retirement rates, termination rates, salary increases and other experience that was different from assumed.

Weighted-average asset allocations at year end, by asset category are as follows:

27 unchanged sentences

For investments in equity and bond mutual funds, and real estate funds, fair value is based on observable, Level 1 inputs.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Plan Cash Flows

Contributions

The Company made $ 1.1 million and no contributions to the Plan in fiscal 2023 and fiscal 2022, respectively.

The Company contribution to the Plan was $ 12.7 million for fiscal 2021.

The Company made $ 0.4 million and $ 1.1 million contributions to the Plan in fiscal 2024 and fiscal 2023, respectively.

The Company made no contributions to the Plan for fiscal 2022.

The Company closely monitors the funded status of the Plan with respect to legislative and accounting rules.

The Company expected to make contributions totaling $ 1.1 million to the Plan during fiscal 2024.

The Company is expected to make contributions totaling $ 0.0 million to the Plan during fiscal 2025.

Estimated Future Benefit Payments

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(In millions)

18 unchanged sentences

Competes in the worldwide contact lens market by developing, manufacturing and marketing a broad range of products for contact lens wearers, featuring advanced materials and optics.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

• CooperSurgical.

Competes in the general health care market with a focus on advancing the health of women, babies and families through a diversified portfolio of products and services focusing on women's health and fertility.

Competes in the fertility and women's health care market through its diversified portfolio of products and services, including fertility products and services, medical devices, cryostorage (such as cord blood and cord tissue storage) and contraception.

The Company uses operating income, as presented in our financial reports, as the primary measure of segment profitability.

3 unchanged sentences

Total identifiable assets are those used in continuing operations except cash and cash equivalents, which the Company includes as corporate assets.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

The following table presents a summary of our business segment net sales:

1 unchanged sentence

CooperVision net sales by category:

Toric lens $ 828.7 $ 737.4 $ 697.5

Multifocal lens 305.7 264.4 238.6

Single-use sphere lens 705.4 661.6 616.3

Non single-use sphere, other 583.9 579.9 599.6

Toric and multifocal $ 1,257.2 $ 1,134.4 $ 1,001.8

Sphere, other 1,352.2 1,289.3 1,241.5

Total CooperVision net sales 2,609.4 2,423.7 2,243.3

1 unchanged sentence

Office and surgical 774.7 689.5 633.6

689.5 633.6 451.3

Fertility 511.3 480.0 431.5

18 unchanged sentences

Interest expense 105.3

Other (income), net ( 25.0 )

Other expense, net 14.9

Income before income taxes $ 412.9

6 unchanged sentences

Interest expense 57.3

Other expense, net ( 8.8 )

Other (income), net ( 25.0 )

Income before income taxes $ 475.3

18 unchanged sentences

Net sales $ 2,375.3 $ 2,057.9 $ ( 840.0 ) $ 3,593.2

Operating (loss) income $ 71.8 $ 403.8 $ 32.0 $ 507.6

Operating income $ — $ 516.2 $ 16.9 $ 533.1

Long-lived assets $ 1,027.6 $ 325.9 $ 279.1 $ 1,632.6

16 unchanged sentences

The resulting impact on our Consolidated Financial Statements from currency hedging activities was not significant for the years ended October 31, 2024, 2023 and 2022.

As of October 31, 2023, the Company has six interest rate swap contracts that have a total notional amount of $ 1.3 billion and remaining maturities of four years or less.

As of October 31, 2024, the Company has nine interest rate swap contracts that have a total notional amount of $ 1.8 billion and remaining maturities of less than three years .

The following table summarizes the amounts recognized with respect to our derivative instruments within the accompanying Consolidated Statements of Income:

3 unchanged sentences

Interest rate swap contracts Interest expense (income) $ ( 55.0 ) $ ( 43.1 ) $ 2.3

$ ( 43.1 ) $ ( 2.3 ) $ 8.0

The cumulative pre-tax impact of the gain on derivatives designated for hedge accounting is recognized in "Accumulated other comprehensive loss".

10 unchanged sentences

Stockholders’ Equity for amounts presented net of the related tax impact in "Accumulated other comprehensive loss".

The Company expects that $( 48.2 ) million recorded as a component of "Accumulated other comprehensive loss" will be realized in our Consolidated Statements of Income over the next twelve months and the amount will vary depending on prevailing interest rates.

The Company expects that $( 31.5 ) million recorded as a component of "Accumulated other comprehensive loss" will be realized in the Consolidated Statements of Income over the next twelve months and the amount will vary depending on prevailing interest rates.

THE COOPER COMPANIES, INC.

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data