What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-02-22 compared with 2023-03-01 · 405 added, 495 removed, 1172 unchanged (43% of the section changed)

13 unchanged sentences

Discontinued Operations 73

Acquisitions 72

Acquisitions and Investments

Net Income Per Share from Continuing Operations 80

8 unchanged sentences

Segment Information 103

Selected Quarterly Data—(unaudited) 103

Subsequent Events

Report of Independent Registered Public Accounting Firm

Internal Control Over Financial Reporting

To the Shareholders and the Board of Directors of Enovis Corporation

2 unchanged sentences

In our opinion, Enovis Corporation and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of Enovis Corporation as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2022, and the related notes and financial statement schedule listed in the Index 15(A)(2) and our report dated March 1, 2023 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2023, and the related notes and financial statement schedule listed in the Index 15(A)(2) and our report dated February 22, 2024 expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible 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 Report on Internal Control Over Financial Reporting.

The Company’s management is responsible 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 internal control over financial reporting based on our audit.

14 unchanged sentences

Philadelphia, Pennsylvania

March 1, 2023

February 22, 2024

Report of Independent Registered Public Accounting Firm

4 unchanged sentences

generally accepted accounting principles.

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 December 31, 2022, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 1, 2023 expressed an unqualified opinion thereon.

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 December 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 22, 2024 expressed an unqualified opinion thereon.

Basis for Opinion

27 unchanged sentences

Philadelphia, Pennsylvania

March 1, 2023

February 22, 2024

ENOVIS CORPORATION

16 unchanged sentences

Gain on cost basis investment — ( 8,800 ) —

Other income ( 2,088 ) — —

Other income, net ( 25,663 ) ( 2,088 ) —

Loss from continuing operations before income taxes ( 67,128 ) ( 2,069 ) ( 121,781 )

18 unchanged sentences

Other comprehensive income (loss):

Foreign currency translation, net of tax expense (benefit) of $ 338 , $ 3,449 and $( 25 )

Foreign currency translation, net of tax expense of $ — , $ 338 and $ 3,449

66,513 ( 61,378 ) ( 114,389 )

4 unchanged sentences

Amounts reclassified from Accumulated other comprehensive loss:

Amortization of pension and other post-retirement net actuarial gain, net of tax expense of $ 199 , $ 1,148 and $ 883

Amortization of pension and other post-retirement net actuarial gain (loss), net of tax expense (benefit) of $( 356 ), $ 199 and $ 1,148

( 1,976 ) 629 5,025

Reclassification of hedging gain (loss), net of tax expense (benefit) of $ 22 , $ — , and $ —

Other comprehensive income (loss) 28,612 ( 39,514 ) ( 65,247 )

13 unchanged sentences

Other current assets 71,112 48,155

Total current assets associated with discontinued operations — 956,614

Total current assets 896,519 795,023

4 unchanged sentences

Other assets 90,255 80,288

Total non-current assets associated with discontinued operations — 2,738,049

Total assets $ 4,509,334 $ 4,273,248

4 unchanged sentences

Accrued liabilities 237,132 210,292

Total current liabilities associated with discontinued operations — 635,284

Total current liabilities 369,607 565,199

2 unchanged sentences

Other liabilities 204,178 166,989

Total non-current liabilities associated with discontinued operations — 573,562

Total liabilities 1,088,633 823,447

16 unchanged sentences

Balance at January 1, 2021 39,498,896 $ 40 $ 3,478,086 $ 517,367 $ ( 452,106 ) $ 44,487 $ 3,587,874

Cumulative effect of accounting change — — — ( 4,818 ) — — ( 4,818 )

Net income — — — 71,657 — 4,621 76,278

Distributions to noncontrolling owners — — — — — ( 3,713 ) ( 3,713 )

Other comprehensive income, net of tax benefit of $ 9,764

— — — — 31,739 ( 2,561 ) 29,178

Common stock-based award activity 145,869 — 32,411 — — — 32,411

Balance at December 31, 2020 39,498,896 40 3,478,086 517,367 ( 452,106 ) 44,487 3,587,874

Net income — — — 71,657 — 4,621 76,278

Distributions to noncontrolling owners — — — — — ( 3,713 ) ( 3,713 )

Other comprehensive income, net of tax expense of $ 14,945

5 unchanged sentences

Balance at December 31, 2021 52,083,078 52 4,544,315 589,024 ( 516,013 ) 44,055 4,661,433

Net income — — — ( 13,292 ) — 1,533 ( 11,759 )

Net income (loss) — — — ( 13,292 ) — 1,533 ( 11,759 )

Distributions to noncontrolling owners — — — — — ( 1,591 ) ( 1,591 )

6 unchanged sentences

Balance at December 31, 2022 54,228,619 54 2,925,729 575,732 ( 53,430 ) 1,716 3,449,801

Net income (loss) — — — ( 33,261 ) — 530 ( 32,731 )

Other comprehensive loss, net of tax benefit of $ 10,472

— — — — 28,549 63 28,612

ESAB Separation adjustment — — 1,140 — — — 1,140

Payment of capped call transactions — — ( 61,962 ) — — — ( 61,962 )

Common stock-based award activity 368,523 1 35,840 — — — 35,841

Balance at December 31, 2023 54,597,142 $ 55 $ 2,900,747 $ 542,471 $ ( 24,881 ) $ 2,309 $ 3,420,701

See Notes to Consolidated Financial Statements.

6 unchanged sentences

Net income (loss) $ ( 32,731 ) $ ( 11,759 ) $ 76,278

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

Depreciation, amortization and other impairment charges 217,109 219,710 262,919

2 unchanged sentences

Gain on investment in ESAB Corporation — ( 102,669 ) —

Gain on cost basis investment ( 8,800 ) — —

Gain on cost basis investments — ( 8,800 ) —

Unrealized gain on currency hedges ( 24,311 ) — —

Debt extinguishment charges 7,333 20,396 29,870

7 unchanged sentences

Other operating assets and liabilities 20,423 ( 46,464 ) 45,384

Net cash (used in) provided by operating activities ( 55,861 ) 356,099 301,935

Net cash provided by (used in) operating activities 134,988 ( 55,861 ) 356,099

Cash flows from investing activities:

1 unchanged sentence

Proceeds from sale of property, plant and equipment 32,571 2,746 7,033

Acquisitions, net of cash received, and investments ( 73,684 ) ( 223,272 ) ( 69,846 )

Payments for acquisitions, net of cash received, and investments ( 152,815 ) ( 73,684 ) ( 223,272 )

Net cash used in investing activities ( 242,467 ) ( 176,388 ) ( 320,476 )

1 unchanged sentence

Proceeds from borrowings on term credit facility — 450,000 —

Payments under term credit facility ( 785,000 ) — ( 40,000 )

Repayments of borrowings under term credit facility ( 219,468 ) ( 785,000 ) —

Proceeds from borrowings on revolving credit facilities and other 455,000 65,000 991,494

1 unchanged sentence

Repayments of borrowings on senior notes — ( 686,278 ) ( 700,000 )

Repayments of borrowings on Euro senior notes ( 386,278 ) — —

Proceeds from borrowings on senior unsecured convertible notes 460,000 — —

Distribution from ESAB Corporation, net — 1,143,369 —

2 unchanged sentences

Payment of debt extinguishment costs — ( 12,704 ) ( 24,375 )

Payment of capped call transactions ( 61,962 ) — —

Deferred consideration payments and other ( 3,536 ) ( 7,507 ) ( 9,866 )

Net cash (used in) provided by financing activities ( 465,127 ) 584,906 ( 131,651 )

Effect of foreign exchange rates on Cash and cash equivalents and Restricted Cash 2,301 ( 2,228 ) ( 3,768 )

(Decrease) increase in Cash and cash equivalents and Restricted cash ( 695,075 ) 618,301 ( 8,563 )

Cash and cash equivalents and Restricted Cash, beginning of period 719,370 101,069 109,632

Cash and cash equivalents, end of period $ 24,295 $ 719,370 $ 101,069

Net cash provided by (used in) financing activities 127,797 ( 465,127 ) 584,906

Effect of foreign exchange rates on Cash and cash equivalents 219 2,301 ( 2,228 )

Increase (decrease) in Cash and cash equivalents and restricted cash 20,537 ( 695,075 ) 618,301

Cash, cash equivalents and restricted cash, beginning of period 24,295 719,370 101,069

Cash, cash equivalents and restricted cash, end of period $ 44,832 $ 24,295 $ 719,370

Supplemental disclosures:

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Enovis Corporation (the “Company” or “Enovis”) was previously Colfax Corporation (“Colfax”) until its separation into two differentiated, independent, and publicly traded companies on April 4, 2022.

Colfax was a leading diversified technology company that provided fabrication technology and medical device products and services to customers around the world, principally under the ESAB and DJO brands.

Following the completion of the Separation, the Company revised its reporting structure and conducts its business through two operating segments, “Prevention & Recovery” and “Reconstructive”.

The segment results were retroactively restated to the current method the Company conducts its business for all years presented.

Upon completion of the Separation, the Company retained its specialty medical technology business, changed its name to Enovis Corporation, and began trading under the stock symbol “ENOV” on the New York Stock Exchange on April 5, 2022.

Enovis is an innovation-driven medical technology growth company dedicated to developing clinically differentiated solutions that generate measurably better patient outcomes and transform workflows.

The Company conducts its business through two operating segments, “Prevention & Recovery” and “Reconstructive”.

The Prevention & Recovery segment provides orthopedic and recovery science solutions, including devices, software, and services across the patient care continuum from injury prevention to rehabilitation after surgery, injury, or from degenerative disease.

The Reconstructive segment provides surgical implant solutions, offering a comprehensive suite of reconstructive joint products for the hip, knee, shoulder, elbow, foot, ankle, and finger and surgical productivity tools.

On April 4, 2022, the Company completed the separation of its fabrication technology business (the “Separation”) through a tax free, pro-rata distribution of 90 % of the outstanding common stock of ESAB Corporation (“ESAB”) to Colfax stockholders.

To affect the Separation, Colfax distributed to its stockholders one share of ESAB common stock for every three shares of Colfax common stock held at the close of business on March 22, 2022, with the Company initially retaining 10% of the shares of ESAB common stock immediately following the Separation.

Upon completion of the Separation, Colfax, which retained the Company’s specialty medical technology business, changed its name to Enovis Corporation.

On April 5, 2022, the Company began trading under the stock symbol “ENOV” on the New York Stock Exchange.

In connection with the Separation, ESAB issued $ 1.2 billion of new debt securities, the proceeds from which were used to fund a $ 1.2 billion cash distribution to Enovis upon Separation.

The distribution proceeds were used by Enovis in conjunction with $ 450 million of borrowings on a term loan under the new Enovis Credit Agreement, as discussed below, and $ 52.3 million of cash on hand to repay $ 1.4 billion of outstanding debt and accrued interest on the Company’s prior credit facility, and $ 302.8 million of outstanding debt and accrued interest on its 2026 Notes, pay a redemption premium at 103.188 % of the principal amount of the 2026 Notes, and pay other fees and expenses due at closing.

Additionally, on April 7, 2022, the Company also completed the redemption of its Euro Senior Notes representing all of its outstanding € 350 million principal 3.250 % Senior Notes due 2025 at a redemption price of 100.813 % of the principal amount.

Immediately following the Separation, the Company effected a one-for-three reverse stock split of all issued and outstanding shares of Enovis common stock.

As a result of the reverse stock split, all share and per share figures contained in the accompanying Consolidated Financial Statements have been retroactively restated as if the reverse stock split occurred at the beginning of the periods presented.

The distribution proceeds were used by Enovis in conjunction with $ 450.0 million of borrowings on a term loan under the Enovis Credit Agreement, as discussed below, and $ 52.3 million of cash on hand to repay $ 1.4 billion of outstanding debt and accrued interest on the Company’s prior credit facility, and $ 302.8 million of outstanding debt and accrued interest on its 2026 Notes, pay a redemption premium at 103.188 % of the principal amount of the 2026 Notes, and pay other fees and expenses due at closing.

Additionally, on April 7, 2022, the Company also completed the redemption of its Euro Senior Notes representing all of its outstanding € 350.0 million principal 3.25 % Euro Senior Notes due 2025 at a redemption price of 100.813 % of the principal amount.

Immediately following the Separation, the Company effected a one-for-three reverse stock split of all issued and outstanding shares of Enovis common stock, and all share and per share figures were restated in the 2022 Form 10-K.

The Company completed the divestiture of its 10 % retained shares in ESAB in a tax-efficient exchange for $ 230.5 million of its $ 450.0 million term loan outstanding under the Credit Agreement on November 18, 2022.

2 unchanged sentences

Unless otherwise indicated, all amounts in the notes to the consolidated financial statements refer to continuing operations.

The accompanying Consolidated Financial Statements reflect the results of (1) ESAB, the Company’s former fabrication technology business;

(2) charges, assets and liabilities for previously retained asbestos contingencies;

and (3) divestiture-related expenses associated with our former Air and Gas Handling business (“Air & Gas”) that was sold in 2019 as a discontinued operation for all periods presented.

The accompanying Consolidated Financial Statements include the following in discontinued operations:

(1) operating results through the first quarter of 2022 of ESAB, the Company’s former fabrication technology business;

(2) charges through the first quarter of 2022 for previously retained asbestos contingencies from divested businesses for which the Company did not retain an interest in the ongoing operation and that were fully transferred to ESAB in conjunction with the Separation;

(3) certain expenses related to the Separation in 2022, (4) a charge related to the release of a tax indemnification receivable from ESAB and release of uncertain tax positions in the second quarter of 2023, and (5) divestiture-related expenses and gain on disposal from the sale of a retained facility from a prior divestiture.

See Note 4, “Discontinued Operations”, for further information.

The COVID-19 pandemic, its resulting impact on governments, businesses and individuals, and actions taken by them in response to the situation resulted in widespread economic disruptions, which significantly affected broader economies, financial markets, and overall demand for the Company’s products in fiscal year 2020.

Other than a surge of COVID-19 cases due to the emergence of COVID-19 variants in the third quarter of 2021, the impacts lessened in 2021 and 2022 due to broadening access to COVID-19 vaccines and gradual relaxing of some government-mandated restrictions.

Sales in our Prevention & Recovery and Reconstructive segments typically peak in the fourth quarter.

13 unchanged sentences

Under the measurement alternative, these financial instruments are carried at cost, less any impairment, adjusted for changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.

The Company accounts for investments as a noncurrent asset within Other assets in the Consolidated Financial Statements as the Company does not have the intent and ability to sell such assets within the next twelve months.

All equity investments are reviewed periodically for indications of other-than-temporary impairment, including, but not limited to, significant and sustained decreases in quoted market prices or a series of historic and projected operating losses by investees.

If the decline in fair value is considered to be other-than-temporary, an impairment loss is recorded and the investment is written down to a new carrying value.

As of December 31, 2022, the Company held investments of $ 16.5 million in privately held companies, the majority of which are within the Prevention & Recovery operating segment.

These investments represent minority ownership interests and are accounted for under the cost method as the Company does not have significant influence over the investees.

The largest of the Company’s investments consist of a $ 10.0 million investment in HT Bioimaging Ltd., a company that has developed a non-invasive cancer scanning technology for veterinarians.

There have been no impairments or upward adjustments in the current year or since acquisition of these investments.

As of December 31, 2023, the Company held investments of $ 20.4 million in privately held companies without readily determinable fair values, the majority of which are within the Prevention & Recovery operating segment.

One investment is accounted for under the equity method of accounting.

The other investments represent minority ownership interests and are accounted for under the cost method.

Revenue Recognition

4 unchanged sentences

Therefore, we do not have material revenues in excess of customer billings or billings to customers in excess of recognized revenues.

Refer to Note 6, “Revenue”, and Note 15, “Accrued Liabilities”, for additional information on the Company’s contract liability balances.

The amount of revenue recognized reflects the consideration to which the Company expects to be entitled in exchange for transferring the goods or services.

3 unchanged sentences

Any estimates are evaluated on a quarterly basis until the uncertainty is resolved.

Additionally, the Company maintains provisions for estimated contractual allowances for reimbursement amounts from certain third-party payors based on negotiated contracts, historical experience for non-contracted payors, and the impact of new contract terms or modifications of existing arrangements with these customers.

These allowances are recorded as a reduction to sales in the same period that the sales are recognized.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

payors, and the impact of new contract terms or modifications of existing arrangements with these customers.

These allowances are recorded as a reduction to sales in the same period that the sales are recognized.

The period of benefit for the Company’s incremental costs of obtaining a contract generally have less than a one-year duration;

10 unchanged sentences

Interest expense, net includes interest income of $ 0.2 million, $ 0.2 million and $ 0.2 million for the years ended December 31, 2023, 2022 and 2021, respectively, primarily associated with interest-bearing deposits of certain foreign subsidiaries.

In April 2023, the Company entered into synthetic debt cross-currency swap agreements to hedge its net investment in its Swiss Franc-denominated subsidiaries against adverse movements in exchange rates between the U.S.

Dollar and the Swiss Franc.

The Company receives fixed-rate amounts from the counterparties in exchange for the Company making foreign-currency fixed-rate interest payments over the life of the agreements.

During the year ended December 31, 2023, the Company received interest income on its cross-currency swap agreements of $ 7.3 million, which is included within Interest expense, net in the Consolidated Statements of Operations.

See Note 17, “Financial Instruments” for further information on the cross-currency swap agreement.

Cash and Cash Equivalents

Cash and cash equivalents include all financial instruments purchased with an initial maturity of three months or less.

Restricted Cash

Cash and cash equivalents that are restricted as to withdrawal or use under the terms of certain contractual agreements are excluded from Cash and cash equivalents in the Consolidated Balance Sheets.

The balance in restricted cash is related to the acquisition of Precision AI and will be released to the seller within one year of the acquisition date upon completion of three milestones.

See Note 5, “Acquisitions and Investments" for further information.

The balance of restricted cash is presented as a component of Other current assets on the Consolidated Balance Sheets.

The following table summarizes the Company’s Cash and Cash equivalents and Restricted cash:

(In thousands)

Cash and cash equivalents

$ 36,191 $ 24,295

Restricted cash

Total cash and cash equivalents and restricted cash

$ 44,832 $ 24,295

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Trade Receivables

Trade receivables are presented net of an allowance for credit losses.

The Company adopted ASU No.

2016-13, Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments as of January 1, 2020.

Trade receivables are presented net of an allowance for credit losses in accordance with Topic 326, “Financial Instruments - Credit Losses”.

The estimate of current expected credit losses on trade receivables considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts.

8 unchanged sentences

The Company capitalizes surgical implant instruments that are provided free-of-charge to surgeons for use while implanting its surgical products and the related depreciation expense is recorded as a component of Selling, general and administrative expense.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Impairment of Goodwill and Indefinite-Lived Intangible Assets

16 unchanged sentences

For the year ended December 31, 2023, the Company performed a quantitative assessment of Goodwill for the Reconstructive and Prevention & Recovery reporting units, both of which indicated no impairment existed.

The carrying amount of Goodwill of the Reconstructive and Prevention & Recovery reporting units for the year ended December 31, 2022 was $ 0.9 billion and $ 1.1 billion, respectively.

The carrying amount of Goodwill of the Prevention & Recovery and Reconstructive reporting units for the year ended December 31, 2023 was $ 1.1 billion and $ 1.0 billion, respectively.

The Company determined the fair value of the reporting units by equally weighting a discounted cash flow approach and market valuation approach, and the reporting unit’s fair value exceeded its carrying amount by approximately 4 % and 8 %, respectively.

Determining the fair value of a reporting unit requires the application of judgment and involves the use of significant estimates and assumptions which can be affected by changes in business climate, economic conditions, the competitive environment and other factors.

Determining the fair value of a reporting unit requires the application of judgment and involves the use of significant estimates and assumptions which can be affected by changes in

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

business climate, economic conditions, the competitive environment and other factors.

The Company bases these fair value estimates on assumptions the Company’s management believes to be reasonable but which are unpredictable and inherently uncertain.

2 unchanged sentences

For sensitivity analysis, the Company estimated the fair value of the Prevention & Recovery and Reconstructive reporting units if the Company reduced the long-term revenue growth rate by 25 basis points, and the resulting excess fair value over carrying value decreased by 130 and 150 basis points, respectively.

Upon the Separation and the revision of the Company’s operating segments, the Company evaluated and concluded that it has two reporting units, Prevention & Recovery and Reconstructive.

An allocation of goodwill was performed to the new reporting units.

A quantitative impairment test of Goodwill for the Prevention & Recovery and Reconstructive reporting units was performed for the years ended December 31, 2022, which indicated no impairment existed.

A quantitative impairment test of Goodwill for the Prevention & Recovery and Reconstructive reporting units was performed for the year ended December 31, 2022 , which indicated no impairment existed.

Impairment of Long-Lived Assets Other than Goodwill and Indefinite-Lived Intangible Assets

Intangible assets primarily represent acquired trade names, customer relationships, acquired technology and software license agreements.

Intangible assets are being amortized on a straight-line basis over their estimated useful lives, which approximates the period of benefit, and ranges from three to twenty years .

Intangible assets are being amortized on a straight-line basis over their estimated useful lives, which approximates the period of benefit.

The useful life of intangible asset as of December 31, 2023 range from three to twenty years with the largest asset groups of Acquired Technology, Acquired Customer Lists, and Acquired Trade Names having weighted-average useful life assignments of 12 , 9 , and 20 , respectively.

The Company assesses its long-lived assets and finite-lived intangible assets for impairment whenever facts and circumstances indicate that the carrying amounts may not be fully recoverable.

To analyze recoverability, the Company projects

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

undiscounted net future cash flows over the remaining lives of such assets.

To analyze recoverability, the Company projects undiscounted net future cash flows over the remaining lives of such assets.

If these projected cash flows are less than the carrying amounts, an impairment loss equal to the difference between the carrying amount of the asset and its fair value would be recognized, resulting in a write-down of the assets with a corresponding charge to earnings.

2 unchanged sentences

The Company did not record any asset impairment charges during the years ended December 31, 2023 and 2022.

The Company recorded an asset impairment loss related to a facility closure totaling $ 1.6 million during the year ended December 31, 2020, as a component of Restructuring and other charges in the Consolidated Statements of Operations.

The Company is subject to foreign currency risk associated with the translation of the net assets of foreign subsidiaries to United States (“U.S.”) dollars on a periodic basis.

5 unchanged sentences

See Note 17, “Financial Instruments and Fair Value Measurements” for additional information regarding the Company’s derivative instruments.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Income taxes for the Company are accounted for under the asset and liability method.

10 unchanged sentences

The Company establishes a liability for unrecognized income tax benefits for income tax positions for which it is more likely than not that a tax position will not be sustained upon examination by the respective taxing authority to the extent such tax positions reduce the Company’s income tax liability.

The Company recognizes interest and penalties related to unrecognized income tax benefits in Income tax expense (benefit) in the Consolidated Statements of Operations.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company recognizes interest and penalties related to unrecognized income tax benefits in Income tax benefit in the Consolidated Statements of Operations.

Foreign Currency Exchange Gains and Losses

6 unchanged sentences

Differences in exchange rates during the period between the date a transaction denominated in a foreign currency is consummated and the date on which it is either settled or translated for inclusion in the Consolidated Balance Sheets are recognized in Selling, general and administrative expense or Interest expense, net in the Consolidated Statements of Operations for that period.

During the year ended December 31, 2023, the Company recognized net foreign currency transaction loss of $ 2.7 million in Selling, general and administrative expense in the Consolidated Statements of Operations.

During the year ended December 31, 2022, the Company recognized net foreign currency transaction gain of $ 0.7 million in Interest expense, net and net foreign currency transaction loss of $ 0.6 million in Selling, general and administrative expense in the Consolidated Statements of Operations.

During the year ended December 31, 2021, the Company recognized net foreign currency transaction loss of $ 0.5 million in Interest expense, net and net foreign currency transaction loss of $ 2.0 million in Selling, general and administrative expense in the Consolidated Statements of Operations.

During the year ended December 31, 2020, the Company recognized net foreign currency transaction gain of $ 1.1 million in Interest expense, net and net foreign currency transaction loss of $ 1.6 million in Selling, general and administrative expense in the Consolidated Statements of Operations.

Debt Issuance Costs and Debt Discount

1 unchanged sentence

Further, the carrying value of debt is reduced by an original issue discount, which is accreted to Interest expense, net using the effective interest method over the term of the related obligation.

As of December 31, 2022, $ 4.5 million and $ 0.2 million of deferred issuance costs were included in Other assets and as a reduction of Long-term debt, respectively.

As of December 31, 2021, $ 5.2 million and $ 7.1 million of deferred issuance costs were included in Other assets and as a reduction of Long-term debt, respectively.

See Note 13, “Debt” for additional discussion regarding the Company’s borrowing arrangements.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Use of Estimates

2 unchanged sentences

Actual results may differ from those estimates.

Reclassifications

Certain prior period amounts have been reclassified to conform to current year presentations.

The operating results of ESAB, which was separated on April 4, 2022, are presented as discontinued operations in the Consolidated Statement of Operations for all periods presented and the net assets of ESAB and the other entities that were part of the Separation, including asbestos contingencies, are presented as discontinued operations on the Consolidated Balance Sheet as of December 31, 2021.

See Note 4, “Discontinued Operations” for further information.

Amortization of acquired intangibles and Research and development expense are now separately presented on our Consolidated Statements of Operations;

these amounts were previously included in Selling, general and administrative expense.

Note 6, “Revenue” and Note 19, “Segment Information” have been further disaggregated to conform to current year presentation .

Recently Issued Accounting Pronouncements

The Company evaluates the adoption impacts of recently issued accounting pronouncements as well as material updates to previous pronouncements on the Company’s Consolidated Financial Statements.

There were no new material accounting standards adopted in 2022 that impacted the Company.

Typically, recently issued standards do not require adoption until a future effective date.

During the year ended December 31, 2023, there were no new material accounting standards adopted that impacted the Company.

Standards to be Implemented

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

Improvements to Reportable Segment Disclosures.

The amendments require enhanced disclosures about significant segment expenses if they are regularly provided to the Chief Operating Decision Maker and included in each reported measure of segment profit or loss.

In addition, the amendments expand interim disclosure requirements and clarify circumstances in which an entity can disclose multiple segment measures of profit or loss.

2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The Company is currently evaluating the impact of this ASU on its consolidated financial statement disclosures.

In December 2023, the FASB issued Accounting Standards Update (ASU) No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures which is intended to enhance the transparency and decision usefulness of income tax disclosures.

The amendments require public business entities to disclose additional information in specified categories within the income tax rate reconciliation and greater detail about individual reconciling items to the extent the impact of those items exceeds a specified threshold.

Additionally, the amendments require disclosure of incomes taxes paid (net of refunds received) to be disaggregated for federal, state, and foreign taxes and further disaggregated for specific jurisdictions to the extent the related amounts exceed a quantitative threshold.

The amendments further require disclosure of income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign;

and disclosure of income tax expense (or benefit) from continuing operations disaggregated by federal (national), state, and foreign.

2023-09 is effective for annual periods beginning after December 15, 2024.

The Company is currently evaluating the impact of this ASU on its consolidated financial statement disclosures.

Other recently issued accounting pronouncements are not expected to have a material impact on the Company's consolidated financial statements.

ENOVIS CORPORATION

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These Agreements govern the Separation between Enovis and ESAB of the assets, employees, liabilities and obligations (including its investments, property and employee benefits and tax-related assets and liabilities) of Enovis and its subsidiaries attributable to periods prior to, at and after the Separation and will govern certain relationships between Enovis and ESAB after the Separation.

The impact of services to be provided to ESAB and agreed upon charges as part of the Separation are not expected to be material to our consolidated financial statements.

The impact of services provided to ESAB and agreed upon charges as part of the Separation are not material to our consolidated financial statements.

The matters of the agreements with ESAB have substantially concluded.

Asbestos Contingencies

The Company retained certain asbestos-related contingencies and insurance coverages from its previously divested businesses for which it did not retain an interest in the ongoing operations except for the contingencies.

Prior to the Separation, the Company retained certain asbestos-related contingencies and insurance coverages from its previously divested businesses for which it did not retain an interest in the ongoing operations except for the contingencies.

The net costs and cash flows associated with these contingencies and coverages were reported by the Company as discontinued operations.

In conjunction with the Separation, all asbestos-related contingencies and insurance coverages from its divested businesses were transferred fully to ESAB.

The Company has classified asbestos-related charges through the date of Separation in its Condensed Consolidated Statements of Operations as part of Income from discontinued operations, net of taxes.

Income from discontinued operations, net of taxes on the Statements of Operations for the years ended December 31, 2022, 2021 and 2020 include pre-tax charges from previously retained asbestos-related contingencies of $ 3.2 million, $ 15.6 million and $ 10.6 million, respectively.

Subsequent to the Separation, the asbestos-related charges and asbestos assets and liabilities are no longer reflected in the Enovis financial statements.

Divestiture-related Expenses Related to our former Air and Gas Handling Business

The Company sold Air & Gas in 2019.

Accordingly, the accompanying Consolidated Financial Statements for all periods presented reflect the pre-tax divestiture-related expenses related to Air & Gas of $ 1.7 million, $ 9.1 million and $ 9.0 million for the years ended December 31, 2022, 2021 and 2020, respectively, as discontinued operations.

The Company has classified asbestos-related charges through the date of Separation in its Consolidated Statements of Operations as part of Income from discontinued operations, net of taxes.

Items Related to our former Air and Gas Handling Business

The Company sold its air & gas handling business in 2019.

Accordingly, the accompanying Consolidated Financial Statements for all periods presented reflect pre-tax divestiture-related expenses (benefit) of $( 0.7 ) million , $ 1.7 million and $ 9.1 million for the years ended December 31, 2023, 2022 and 2021, respectively, as discontinued operations.

The divestiture-related expenses (benefit) are primarily maintenance costs and cost to sell a retained interest in a facility no longer used in operations including certain professional, legal, and consulting fees as well as a settlement executed in the first quarter of 2021.

In the third quarter of 2023, the Company sold the retained interest in the facility and recorded a gain of $ 15.5 million.

Summary of Items Treated as Discontinued Operations

As a result of the Separation and prior sale of Air & Gas, the operating results of (1) ESAB, the Company’s former fabrication technology business, (2) charges related to the previously retained asbestos contingencies and (3) Air & Gas divestiture-related expenses have been presented as discontinued operations in the Consolidated Statements of Operations for all periods presented.

Additionally, the Consolidated Balance Sheet as of December 31, 2021 presents the Assets and Liabilities of the fabrication technology business and asbestos contingencies as discontinued operations.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The carrying value of the assets and liabilities of the Company’s former fabrication technology business and asbestos contingencies amounts presented as discontinued operations as of December 31, 2021 was as follows:

December 31, 2021

(in thousands)

Cash and cash equivalents $ 39,118

Trade receivables, net 383,742

Inventories, net 420,062

Prepaid expenses 52,140

Other current assets 61,552

Total current assets 956,614

Property, plant and equipment, net 286,278

Goodwill 1,533,037

Other intangibles, net 521,434

Lease asset - right of use 107,944

Other assets 289,356

Total assets associated with discontinued operations (1)

Current portion of long-term debt $ 613

Accounts payable 348,965

Accrued liabilities 285,706

Total current liabilities 635,284

Long-term debt, less current portion 54

Non-current lease liability 88,777

Deferred tax liabilities 116,198

Other liabilities 368,533

Total liabilities associated with discontinued operations (1)

(1) Total assets and liabilities include asbestos-related contingencies and insurance coverages in connection to the sales of the Fluid Handling and Air & Gas businesses.

See Asbestos Contingencies section above for more information.

As a result of the Separation and prior divestitures, the operating results of (1) ESAB, the Company’s former fabrication technology business, (2) charges related to the previously retained asbestos contingencies and (3) items related to our divested air & gas handling business have been presented as discontinued operations in the Consolidated Statements of Operations for all periods presented.

ENOVIS CORPORATION

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asbestos charges;

divestiture-related expenses related to Air & Gas;

items related related to Air & Gas;

and the combined income tax effect of those items for the years ended December 31, 2023, 2022 and 2021.

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Selling, general and administrative expense — 125,529 477,040

Gain on disposal of facility ( 15,517 ) — —

Restructuring and other charges — 5,304 18,954

Asbestos charges — 3,194 15,578

Divestiture-related expenses (1)

Divestiture-related expenses and other (1)

4,387 46,684 29,668

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Income from discontinued operations before income taxes 11,130 35,585 262,470

Income tax expense 9,155 83,939 37,178

Income tax (benefit) expense (3)

( 9,978 ) 9,155 83,939

Income from discontinued operations, net of taxes $ 21,108 $ 26,430 $ 178,531

(1) Divestiture-related expenses include $ 45.0 million and $ 20.6 million for the years ended December 31, 2022 and 2021, respectively, for the Separation.

(1) Divestiture-related expenses and other includes a charge of $ 5.1 million for the release of a tax indemnification receivable from ESAB for the year ended December 31, 2023 and divestiture-related expenses for the Separation of $ 45.0 million and $ 20.6 million for the years ended December 31, 2022 and 2021, respectively.

(2) Interest expense was allocated to discontinued operations based on allocating $ 1.2 billion of corporate level debt to discontinued operations consistent with the dividend received from ESAB and the debt repaid at the time of the Separation.

Total income attributable to noncontrolling interest related to ESAB, net of taxes for the years ended December 31, 2022, 2021 and 2020, wa s $ 1.0 million , $ 3.6 million, and $ 2.5 million, respectively.

(3) The year ended December 31, 2023 includes benefit of release of uncertain tax positions.

Total income attributable to noncontrolling interest related to ESAB, net of taxes for the years ended December 31, 2022 and 2021 wa s $ 1.0 million, and $ 3.6 million, respectively.

These amounts are presented as net income attributable to noncontrolling interest from discontinued operations - net of taxes on the Consolidated Statements of Operations.

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Year Ended December 31,

2022 2021 2020

(in thousands)

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Cash (used in) provided by operating activities related to discontinued operations for the years ended December 31, 2023, 2022 and 2021 wa s approximately $( 2 ) million, $( 27 ) million, and $ 224 million, respectively.

Cash used in investing activities related to discontinued operations for the years ended December 31, 2022, 2021 and 2020 was approximatel y $ 3 million, $ 35 million , and $ 35 million.

Cash provided by (used in) investing activities related to discontinued operations for the years ended December 31, 2023, 2022 and 2021 was approximatel y $ 33 million, $( 3 ) million , and $( 35 ) million, respectively.

ENOVIS CORPORATION

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Acquisitions and Investments

Lima Acquisition in 2024

On January 3, 2024, the Company acquired LimaCorporate S.p.A.

(“Lima”), a privately held global orthopedic company focused on restoring motion through digital innovation and customized hardware, at an enterprise value of € 800 million (the “Lima Acquisition”), consisting of (i) approximately € 700 million in cash consideration, which includes repayment of certain indebtedness, to be paid at closing, and (ii) 1,942,686 shares of common stock of Enovis valued at approximately € 100 million based on the thirty-day volume weighted average price of the Company’s common stock as of the close of business day on September 21, 2023, and which are expected to be issued within eighteen months following the closing of the Lima Acquisition, in each case subject to certain adjustments and conditions as provided for in the purchase agreement.

During the year ended December 31, 2023, the Company incurred $ 9.0 million of strategic transactions costs, including advisory, legal, audit, valuation and other professional service fees in connection with the Lima acquisition, which are included in Selling, general and administrative expense in the Consolidated Statements of Operations.

The Lima acquisition will be accounted for using the acquisition method of accounting and accordingly, the Consolidated Financial Statements will include the financial position and results of operations from the date of acquisition.

2023 Acquisitions

On June 28, 2023, the Company completed the Novastep business combination in its Reconstructive segment.

Novastep is a leading player in Minimally Invasive Surgery (MIS) foot and ankle solutions with a best-in-class MIS bunion system serving a rapidly growing portion of the global bunion segment.

The acquisition is accounted for under the acquisition method of accounting, and accordingly, the Consolidated Financial Statements include the financial position and results of operations from the acquisition date.

The Company paid $ 96.9 million for the acquisition, net of cash received.

The Company has allocated $ 43.7 million to goodwill and $ 52.0 million to intangible assets acquired.

The acquisition accounting reflects our preliminary estimates and are subject to adjustment.

The acquired goodwill value is primarily driven by the expected synergies from cross-selling Novastep products to existing Enovis foot & ankle customers.

The acquisition broadens our reconstructive product offerings for the foot and ankle market and expands our customer base in Europe.

Purchase accounting procedures are ongoing and revisions may be recorded in future periods during the measurement period.

On July 20, 2023, the Company completed an asset acquisition transaction with D.N.E., LLC in its Reconstructive segment.

DNE is a developer of a broad line of external fixation products, including circular frames, pin-to-bar frames, and mini-fixators for use in foot and ankle surgeries.

The acquisition of these assets, primarily the developed technology will allow Enovis to expand its robust product portfolio for the Foot & Ankle business unit.

The Company paid $ 28.2 million for the asset acquisition and assigned $ 25.8 million to intangible assets, $ 1.9 million to finished goods inventory and $ 0.5 million to property, plant and equipment.

The acquisition is accounted for on a cost approach.

The Consolidated Financial Statements include the financial position and results of operations from the acquisition date.

On October 5, 2023, the Company acquired a 100 % interest in Precision AI, a developer of surgical planning software.

The transaction was accounted for as an asset acquisition.

The acquisition compliments the Company’s current product offerings in its Reconstruction segment with advanced planning software for shoulder surgery and opportunity to expand to additional anatomies.

On the acquisition date, the Company paid $ 17.6 million, net of cash received and agreed to make contingent payments of approximately $ 12.0 million upon the successful completion of three milestones within one year of the acquisition date.

The milestones are based on FDA approvals and user validation testing of the software.

In December 2023, the first milestone was achieved and the Company paid $ 4.2 million to the sellers.

The remaining contingent amount is held in escrow by Enovis as restricted cash and presented in Other current asset in the Consolidated Balance Sheet.

The Company has control over these funds and is required to authorize the transfer upon completion of the milestones.

As the asset acquisition is accounted for under a cost approach, the potential additional contingent payments are not recorded until the milestones are achieved.

The Consolidated Financial Statements include the assets acquired and results of operations from the acquisition date.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

2022 Acquisitions

In 2022, the Company completed four asset acquisitions, two business acquisitions, and one investment, which is carried at cost as it does not have a readily determinable fair value.

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360 Med Care is a medical device distributor that bundles certain computer-assisted surgery and patient experience enhancement programs to add value to its device supply arrangements with surgeons, hospitals, and insurers.

The acquisition is accounted for under the acquisition method of accounting, and accordingly, the Condensed Consolidated Financial Statements include the financial position and results of operations from the acquisition date.

The Company paid $ 14.3 million for the acquisition, net of cash received, and recorded estimated contingent consideration at fair value of $ 12.8 million related to expected results over future revenue targets.

The Company has preliminarily allocated $ 16.3 million to Goodwill and $ 18.2 million to intangible assets acquired.

Purchase accounting procedures are ongoing and revisions to contingent consideration, intangible assets acquired, and adjustments for working capital true-ups may be recorded in future periods during the measurement period.

As of December 31, 2023, the contingent liability is $ 13.0 million.

The Company allocated $ 16.3 million to Goodwill and $ 18.2 million to intangible assets acquired.

The 360 Med Care acquisition broadens our customer base in Australia and adds to our overall product offerings.

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The ARVIS navigation unit consists of a hands-free heads-up display worn by the surgeon which provides surgical guidance at the point of care in a streamlined, space-conserving, and cost-effective manner compared to traditional robotic offerings.

The acquisition is accounted for under the acquisition method of accounting as a step-acquisition, and accordingly, the Condensed Consolidated Financial Statements include the financial position and results of operations from the acquisition date.

The acquisition is accounted for under the acquisition method of accounting as a step-acquisition, and accordingly, the Consolidated Financial Statements include the financial position and results of operations from the acquisition date.

Enovis made initial investments in Insight in 2021 and 2020, which were carried at cost.

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As of December 31, 2022, Enovis holds a 99.5 % interest in Insight and recognized $ 0.3 million noncontrolling equity interest in its financial statements attributed to Insight.

The Company has preliminarily allocated $ 36.3 million to Goodwill and $ 38.4 million to intangible assets acquired.

The Company allocated $ 36.3 million to Goodwill and $ 38.4 million to intangible assets acquired.

Goodwill is primarily driven by expected synergies between ARVIS’ augmented reality surgical guidance system and our existing customer base and existing products.

The Company does not expect any of the Goodwill to be deductible for tax purposes.

As a result of obtaining control of Insight, the Company remeasured its initial investments to its fair value resulting in a $ 8.8 million gain.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

As of December 31, 2022, the balance of investments held by the company without readily determinable fair values was $ 16.5 million.

The investments are carried at cost minus impairments, if any, plus adjustments for fair value indicators from observable price changes in orderly transactions for the identical or similar investment of the same issuer.

There have been no impairments or upward adjustments in the current year or since acquisition of the investments except for the gain on our previously held equity investment in Insight discussed above.

As a result of acquiring control of Insight, Enovis now consolidates the assets, liabilities, and results of operations of Insight and therefore current year and previous investments in Insight of $ 16.6 million are no longer recorded as cost basis investments.

2021 Acquisitions

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On January 19, 2021, the Reconstructive segment acquired Trilliant Surgical (“Trilliant”), a national provider of foot and ankle orthopedic implants.

The product technologies of Trilliant support the Reconstructive segment’s focused expansion into the adjacent foot and ankle market.

The product technologies of Trilliant support the Reconstructive segment’s focused expansion into

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

the adjacent foot and ankle market.

Trilliant has a broad product portfolio that covers the full universe of foot reconstructive and fixation procedures, and includes the novel Arsenal Foot Plating System, designed for greater flexibility and speed of implant placement.

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The acquisition expands the Reconstructive segment’s reconstructive product portfolio with Mathys’ complimentary surgical solutions and broadens its international customer base.

Purchase accounting procedures for this acquisition have been completed and the finalized allocation of the aggregate fair value of assets acquired and liabilities assumed as of the date of the Mathys acquisition are presented below.

The aggregate fair value of assets acquired and liabilities assumed as of the date of the Mathys acquisition are presented below.

No ne of the Goodwill recognized is expected to be deductible for income tax purposes.

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The following table summarizes the final allocation of consideration related to the Mathys acquisition as of the acquisition date:

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

July 28, 2021

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Trade Receivables $ 19,578

Inventories 76,824

Inventory 76,824

Property, Plant and Equipment 58,465

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Intangible assets $ 106,000

2020 Acquisitions

Our Reconstructive segment completed five acquisitions in 2020 for total consideration, net of cash received, of $ 67.5 million.

Total Goodwill acquired through the acquisitions was $ 21.4 million, of which $ 15.9 million is expected to be deductible for income tax purposes.

Acquisitions in our Prevention & Recovery segment included LiteCure LLC (“LiteCure”), a U.S.

leader in high-powered laser rehabilitation products for human and veterinary medical applications.

The acquisition was completed in the fourth quarter of 2020 for net cash consideration of $ 39.6 million.

Net working capital and intangible assets acquired represent 10 % and 69 % of the total consideration paid, respectively, with the residual amount primarily attributable to Goodwill.

ENOVIS CORPORATION

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While the Company’s sales are primarily derived from three sales channels including dealers and distributors, insurance, and direct to consumers and hospitals, substantially all its revenue is recognized at a point in time.

The Company disaggregates its revenue into the following segments:

The Company disaggregates its revenue into the following geographic or product groupings:

Year Ended December 31,

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Total $ 1,707,197 $ 1,563,101 $ 1,426,188

(1) The year ended December 31, 2022 includes the unfavorable impact of $ 30.9 million of currency.

Given the nature of the businesses, the Company does not generally have unsatisfied performance obligations with an original contract duration of greater than one year.

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Allowance for Credit Losses

The Company adopted ASU No.

2016-13, Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments as of January 1, 2020.

The estimate of current expected credit losses on trade receivables considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts.

Management elected to disaggregate trade receivables into business segments due to risk characteristics unique to each segment given the individual lines of business and market.

The Company estimates current expected credit losses on trade receivables using historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts.

Management disaggregate trade receivables into business segments due to risk characteristics unique to each segment given the individual lines of business and market.

Pooling was further disaggregated based on either geography or product type.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Net Income Per Share from Continuing Operations

Net income per share from continuing operations was computed as follows:

Net Income (Loss) Per Share from Continuing Operations

Net income (loss) per share from continuing operations was computed as follows:

Year Ended December 31,

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$ ( 1.00 ) $ ( 0.72 ) $ ( 2.02 )

(1) Net income from continuing operations attributable to Enovis Corporation for the respective periods is calculated using Net income from continuing operations less the income attributable to noncontrolling interest from continuing operations, net of taxes, of $ 0.6 million, $ 1.1 million and $ 0.7 million for the years ended December 31, 2022, 2021 and 2020, respectively.

As a result of the one-for-three reverse stock split immediately following the Separation, all share and per share figures contained in the Consolidated Financial Statements have been retroactively restated as if the reverse stock split occurred at the beginning of the periods presented.

For the years ended December 31, 2021 and December 31, 2020, the weighted-average shares of Common stock outstanding - basic includes the impact of 6.1 million shares, as adjusted for the reverse stock split, for the actual or potential issuance of shares from tangible equity unit purchase contracts.

In January 2022, the final remaining amount of tangible equity unit purchase contracts were converted into approximately 1.7 million shares of the Company’s common stock, as adjusted for the reverse stock split.

All the issued shares are included in the Common stock issued and outstanding as of December 31, 2022.

(1) Net income (loss) from continuing operations attributable to Enovis Corporation for the respective periods is calculated using Net income (loss) from continuing operations less the net income attributable to noncontrolling interest from continuing operations, net of taxes.

For the years ended December 31, 2021, the weighted-average shares of common stock outstanding - basic included the impact of 6.1 million shares, as adjusted for the reverse stock split, for the actual or potential issuance of shares from tangible equity unit purchase contracts.

In January 2022, the remaining tangible equity unit purchase contracts were converted into approximately 1.7 million shares of the Company’s common stock, as adjusted for the reverse stock split.

All the issued shares are included in the common stock issued and outstanding as of December 31, 2022 and December 31, 2023.

See Note 14, “Equity”, for details.

For the year ended December 31, 2021, conversions of the Company’s tangible equity units resulted in the issuance of approximately 4.4 million shares, as adjusted for the reverse stock split, of common stock.

All issuances of C ommon stock related to the tangible equity units were converted at the minimum settlement rate of 4.0000 shares of Common stock for each purchase contract as a result of the Company’s share price.

For the year ended December 31, 2020, the weighted-average shares of Common stock outstanding - diluted includes the impact of an additional 0.3 million potentially issuable dilutive shares, as adjusted for the reverse stock split, related to tangible equity units as a result of the Company’s share price.

See Note 14, “Equity”, for details.

All issuances of common stock related to the tangible equity units were converted at the minimum settlement rate of 4.0000 shares of common stock for each purchase contract as a result of the Company’s share price.

The weighted-average computation of the dilutive effect of potentially issuable shares of common stock under the treasury stock method for the years ended December 31, 2023, 2022 and 2021 excludes 1.2 million, 1.1 million, and 0.3 million outstanding stock-based compensation awards, respectively, as their inclusion would be anti-dilutive.

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Research and development tax credits ( 4,499 ) ( 2,599 ) ( 2,392 )

Net items not deductible in an international jurisdiction 1,859 772 40

Net items not deductible (taxable) ( 1,478 ) 1,859 772

tax on international operations 2,789 4,565 14,865

Transaction related costs 840 27,699 —

Withholding taxes 495 556 854

Non-deductible employee compensation 5,232 9,013 2,562

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Depreciation and amortization 57,901 28,659

Inventory reserves and capitalization 18,585 6,731

Capitalized R&D expenditures 41,343 29,579

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To the extent a portion or all of the applicable deferred tax assets do not meet the more likely than not threshold, a valuation allowance is recorded.

During the year ended December 31, 2022, the valuation allowance decreased from $ 111.8 million to $ 93.5 million with a net decrease of $ 12.1 million recognized in Income tax expense (benefit) and a $ 6.7 million decrease related to changes in foreign currency rates.

During the year ended December 31, 2023, the valuation allowance increased from $ 93.5 million to $ 101.7 million with a net increase of $ 4.6 million recognized in Income tax benefit and a $ 3.5 million increase related to changes in foreign currency rates.

Consideration was given to tax planning strategies and, when applicable, future taxable income as to how much of the relevant deferred tax asset could be realized on a more likely than not basis.

The Company has U.S.

net operating loss carryforwards of $ 31.2 million expiring in years 2023 through 2037 and $ 26.3 million that may be carried forward indefinitely and U.S.

net operating loss carryforwards of $ 14.2 million expiring in years 2024 through 2043, $ 11.7 million of net operating losses that may be carried forward indefinitely and U.S.

interest limitation carryforward of $ 44.1 million that may be carried forward indefinitely.

The Company’s ability to use these various carryforwards to offset any taxable income generated in future taxable periods may be limited under Section 382 and other federal tax provisions.

As of December 31, 2022, the Company had $ 16.6 million foreign net operating loss carryforwards primarily in Germany, France, and the United Kingdom that may be subject to local tax limitations including changes in ownership.

The foreign net operating losses can be carried forward indefinitely, except in applicable jurisdictions that make up less than five percent of the available net operating losses.

As of December 31, 2023, the Company had $ 17.9 million foreign net operating loss carryforwards primarily in Germany, Switzerland, France, and the United Kingdom that may be subject to local tax limitations including changes in ownership.

The foreign net operating losses can be carried forward indefinitely, except $ 3.1 million of net operating losses in Switzerland expiring in 2030.

The company has $ 31.5 million of foreign interest limitation carryforward primarily in Germany, that may be carried forward indefinitely.

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The Company’s $ 10.5 million R&D credit can be carried back one year and carried forward to tax years 2024 through 2043.

The Company has non-refundable R&D tax offsets of $ 3.4 million carrying forward indefinitely that that may be used to reduce Australian income tax in future periods.

For the year ended December 31, 2023, undistributed earnings of the Company’s foreign subsidiaries are estimated to be $ 78.1 million, all of which is permanently reinvested;

accordingly, the Company has assessed no deferred tax liability as of December 31, 2023 on such earnings.

This is a decrease of $ 0.2 million as compared to the deferred tax liability as of December 31, 2021, which was transferred as part of the divestiture of ESAB.

ENOVIS CORPORATION

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Balance, January 1, 2021 $ 58,014

Acquisitions and divestitures 4,450

Addition for tax positions taken in prior periods 228

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Acquisitions and divestitures ( 23,250 )

Addition for tax positions taken in prior periods 228

Addition for tax positions taken in the current period 462

Reductions related to settlements with taxing authorities ( 425 )

Reductions resulting from a lapse of applicable statute of limitations ( 244 )

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Acquisitions and divestitures 2,052

Addition for tax positions taken in prior periods 3,659

Addition for tax positions taken in the current period 2,251

Reductions related to settlements with taxing authorities ( 125 )

Reductions resulting from a lapse of applicable statute of limitations ( 14,240 )

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The following table summarizes the Company’s Intangible assets, excluding Goodwill:

Year Ended December 31,

Amount Accumulated

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Property, Plant and Equipment, Net

Year Ended December 31,

Depreciable Life 2023 2022

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Inventories, net consisted of the following:

Year Ended December 31,

(In thousands)

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company leases certain office spaces, warehouses, facilities, vehicles, and equipment.

Leases with an initial term of

twelve months or less are not recorded on the balance sheet.

The Company leases certain office space, warehouse, distribution, and production facilities, as well as vehicles and equipment.

Leases with an initial term of twelve months or less are not recorded on the balance sheet.

Most leases include renewal options, which can extend the lease term into the future.

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Term loan $ — $ 219,279

Euro senior notes — 395,552

TEU amortizing notes — 6,501

2026 notes — 297,906

Senior unsecured convertible notes 446,164 —

Revolving credit facilities and other 20,000 40,000

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In conjunction with the Separation which occurred on April 4, 2022, the Company repaid all obligations under its previous credit agreement and entered into a new credit agreement (the “Enovis Credit Agreement”) with certain of its existing bank lenders.

Additionally, on April 7, 2022 after the completion of the Separation, the Company completed the redemptions of its

Additionally, on April 7, 2022 after the completion of the Separation, the Company completed the redemptions of its 3.25 % Euro Senior Notes due 2025 and its 6.375 % Senior Notes due 2026.

As a result of these changes, the Company recorded

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

3.25 % Euro Senior Notes due 2025 and its 6.375 % Senior Notes due 2026.

As a result of these changes, the Company recorded Debt extinguishment charges of $ 20.1 million in the second quarter of 2022, comprised of $ 12.7 million in redemption premiums and $ 7.4 million in noncash write-offs of original issue discount and deferred financing fees.

Debt extinguishment charges of $ 20.1 million in the second quarter of 2022, comprised of $ 12.7 million in redemption premiums and $ 7.4 million in noncash write-offs of original issue discount and deferred financing fees.

Enovis Term Loan and Revolving Credit Facility

The Enovis Credit Agreement consists of a $ 900 million revolving credit facility (the “Revolver”) with an April 4, 2027 maturity date and a term loan with an initial aggregate principal amount of $ 450 million and an April 4, 2023 maturity date (the “Enovis Term Loan”).

The Enovis Credit Agreement became effective April 4, 2022 and consists of a $ 900 million revolving credit facility (the “Revolver”) with an April 4, 2027 maturity date and a term loan with an initial aggregate principal amount of $ 450.0 million and an April 4, 2023 maturity date (the “Enovis Term Loan”).

The Revolver contains a $ 50 million swing line loan sub-facility.

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On November 18, 2022, the Company completed an exchange with a lender under the Enovis Credit Agreement of 6,003,431 shares of common stock of ESAB, representing all of the retained shares in ESAB following the Separation, for $ 230.5 million of the $ 450.0 million in term loan outstanding under the Credit Agreement, net of cost to sell.

On March 1, 2023 the Company extinguished the remaining outstanding balance on the Enovis Team Loan with borrowing on the Revolver.

The Enovis Credit Agreement contains customary covenants limiting the ability of the Company and its subsidiaries to, among other things, incur debt or liens, merge or consolidate with others, dispose of assets, make investments or pay dividends.

In addition, the Enovis Credit Agreement contains financial covenants requiring the Company to maintain (i) a maximum total leverage ratio of not more than 4.00 :1.00, with a step-down to 3.75 :1.00 commencing with the fiscal quarter ending June 30, 2023, and a step-down to 3.50 :1.00 commencing with the fiscal quarter ending June 30, 2024, and (ii) a minimum interest coverage ratio of 3.00 :1.00.

In addition, the Enovis Credit Agreement contains financial covenants requiring the Company to maintain (i) a maximum total leverage ratio of not more than 3.75 :1.00 for the fiscal quarter ending June 30, 2023 and thereafter, stepping down to 3.50 :1.00 for the fiscal quarter ending June 30, 2024, and thereafter, and (ii) a minimum interest coverage ratio of 3.00 :1.00.

The Enovis Credit Agreement contains various events of default (including failure to comply with the covenants under the Enovis Credit Agreement and related agreements) and upon an event of default the lenders may, subject to various customary cure rights, require the immediate payment of all amounts outstanding under the Enovis Term Loan and the Enovis Revolver.

As of December 31, 2023, the Company was in compliance with the covenants under the Enovis Credit Agreement.

On October 23, 2023 the Company entered into an amendment to the Enovis Credit Agreement (the “Amendment”).

The Amendment provided for a new term loan commitment in the aggregate amount of $ 400 million (the “Term Loan Facility”).

The Term Loan Facility extended to the Company under the Amendment was funded on January 3, 2024, the date the Lima Acquisition was consummated.

The Term Loan Facility requires quarterly principal repayments at 1.25 % of the initial aggregate principal amount and ultimately matures on April 4, 2027.

Pursuant to the Amendment, effective as of the date of consummation of the Lima Acquisition, (i) all facilities under the Enovis Credit Agreement (including the Term Loan Facility) became secured by certain personal property of the Company and certain of its subsidiaries, subject to limitations and exclusions;

(ii) the financial covenant under the Enovis Credit Agreement was be adjusted from total leverage ratio to senior secured leverage ratio and requires the senior secured leverage ratio to be no more than 3.75 :1.00 with a step down to 3.50 :1.00 commencing with the fiscal quarter ending June 30, 2024;

(iii) certain changes to the negative covenants became effective (including restrictions on repayments of junior financing and amendments to junior financing documents);

and (iv) certain additional changes were implemented (including the removal of the guaranty fallaway provision).

As of December 31, 2023, the weighted-average interest rate of borrowings under the Enovis Credit Agreement was 6.58 %, excluding accretion of original issue discount and deferred financing fees, and there was $ 880.0 million available on the Revolver.

The Company has $ 4.7 million in deferred financing fees recorded in conjunction with the Credit Facility as of December 31, 2022, which is being accreted to Interest expense, net primarily using the effective interest method over the life of the facility.

Euro Senior Notes

The Company had senior unsecured notes with an aggregate principal amount of € 350 million due in May 2025, with an interest rate of 3.25 %.

The Company previously had senior unsecured notes with an aggregate principal amount of € 350.0 million due in May 2025, with an interest rate of 3.25 %.

The Euro Senior Notes were redeemed on April 7, 2022 at a 100.813 % redemption premium after the completion of the Separation.

Tangible Equity Unit (“TEU”) Amortizing Notes

The Company previously had 6.50 % TEU amortizing notes due in January 2022 at an initial principal amount of $ 15.6099 per note with equal quarterly cash installments of $ 1.4375 per note representing a payment of interest and partial payment of principal.

The Company paid $ 6.5 million, $ 25.0 million, and $ 23.4 million of principal on the TEU amortizing notes in the years ended December 31, 2022, 2021, and 2020, respectively.

The final installment payment was made on January 15, 2022.

Additionally, in the first quarter of 2022, all of the remaining related TEU prepaid stock purchase contracts were converted to shares of common stock.

See Note 14, “Equity” for further information.

2024 Notes and 2026 Notes

The Company had senior notes with a remaining principal amount of $ 300 million, which were due on February 15, 2026 and had an interest rate of 6.375 % (the “2026 Notes”).

The Company previously had 6.50 % TEU amortizing notes at an initial principal amount of $ 15.6099 per note with equal quarterly cash installments of $ 1.4375 per note representing a payment of interest and partial payment of principal.

The final installment payment of $ 6.5 million was made on January 15, 2022.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company previously had senior notes with a remaining principal amount of $ 300 million, which were due on February 15, 2026 and had an interest rate of 6.375 %.

The 2026 Notes were redeemed on April 7, 2022 at a 103.188 % redemption premium after the completion of the Separation.

On April 24, 2021, the Company used the proceeds from its March 2021 equity offering to redeem all of its $ 600 million 6.0 % senior notes due February 14, 2024 (the “2024 Notes”) and $ 100 million of the outstanding principal of its 2026 Notes for

Financing for Lima Acquisitio n

On October 23, 2023 the Company entered into an amendment to the Enovis Credit Agreement (the “Amendment”).

The Amendment provides for a new term loan commitment in the aggregate amount of $ 400 million.

The term loan facility extended to the Company under the Amendment was funded on January 3, 2024, the date the Lima Acquisition was consummated.

The term loan requires quarterly principal repayments at 1.25 % of the initial aggregate principal amount and ultimately matures on April 4, 2027.

Pursuant to the Amendment, effective as of the date of consummation of the Lima Acquisition, (i) all facilities under the Credit Agreement (including the Term Loan Facility) became secured by certain personal property of the Company and certain of its subsidiaries, subject to limitations and exclusions;

(ii) the financial covenant under the Credit Agreement was adjusted from total leverage ratio to senior secured leverage ratio and requires the senior secured leverage ratio to be no more than 3.75 :1.00 with a step down to 3.50 :1.00 commencing with the fiscal quarter ending June 30, 2024;

(iii) certain changes to the negative covenants became effective (including restrictions on repayments of junior financing and amendments to junior financing documents);

and (iv) certain additional changes were implemented (including the removal of the guaranty fallaway provision).

On October 24, 2023, the Company issued $ 460 million aggregate principal amount of senior unsecured convertible notes in a private placement pursuant to Rule 144A (the “2028 Notes”).

The 2028 Notes have an interest rate of 3.875 %, payable semiannually in arrears on April 15 and October 15 of each year, beginning April 15, 2024 and will mature on October 15, 2028 unless earlier repurchased, redeemed, or converted.

Holders may convert their 2028 Notes under the following conditions at any time prior to the close of business on the business day immediately preceding April 15, 2028 in multiples of $1,000 principal amount, only under the following circumstances:

(i) during any calendar quarter commencing after the calendar quarter ending on December 31, 2023 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price on each applicable trading day;

(ii) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the “trading price” per $1,000 principal amount of 2028 Notes, as determined following a request by a holder of 2028 Notes in accordance with the procedures described below, for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day;

(iii) if the Company calls any or all of the 2028 Notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date;

or (iv) upon the occurrence of specified corporate events as described in the indenture governing the 2028 Notes.

In addition, holders may convert their 2028 Notes, in multiples of $1,000 principal amount, at their option at any time beginning on or after April 15, 2028 until the close of business on the second scheduled trading day immediately preceding the maturity date, regardless of the foregoing circumstances.

The conversion rate is 17.1474 shares of common stock per $1,000 principal amount of 2028 Notes (equivalent to an initial conversion price of approximately $ 58.32 per share of common stock), subject to adjustment upon the occurrence of certain specified events as set forth in the indenture governing the 2028 Notes.

Upon conversion, the Company will pay cash up to the aggregate principal amount of the 2028 Notes to be converted and pay or deliver, as the case may be, cash, shares of common stock or a combination of cash and shares of common stock, at its election, in respect of the remainder,

The Company also entered into privately negotiated capped call transactions with certain of the initial purchasers of the 2028 Notes and paid $ 62 million to the counterparties.

The capped call transactions are intended generally to mitigate potential dilution to the Company’s common stock upon conversion of any Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to a cap.

If, however, the market price per share of common stock exceeds $ 89.72 , the initial cap price of the capped call transactions, there would be dilution effect and/or no offset of any cash payments, in each case, attributable to the amount by

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

$ 724.4 million.

The 2024 Notes were redeemed at a redemption price of 103.000 % of their principal amount and the 2026 Notes were redeemed at a redemption price of 106.375 % of their principal amount, plus, in each case, accrued and unpaid interest through the date of redemption.

In the second quarter of 2021, a net loss on the early extinguishment of debt of $ 29.9 million was recorded and included $ 24.4 million of call premium on the retired debt.

which the market price of the common stock exceeds the cap price.

The capped call payment was classified as equity since it meets the derivative scope exception included in ASC 815 Derivative and Hedging.

Other Indebtedness

In addition to the d ebt agreements discussed above, the Company is party to various overdraft facilities with a borrowing capacity of $ 30.0 million .

As of December 31, 2022, there were no outstanding borrowings under these facilities.

The Company is party to letter of credit facilities with an aggregate cap acity of $ 15.0 million.

Total letters of credit of $ 7.1 million were outstanding as of December 31, 2022.

In addition to the d ebt agreements discussed above, the Company is party to overdraft facilities with a borrowing capacity of $ 30.0 million .

Total letters of credit and surety bonds of $ 11.5 million were outstanding as of December 31, 2023.

Deferred Financing Fees

The Company has $ 6.6 million in deferred financing fees included in Other assets as of December 31, 2023 ( $ 3.5 million related to the Revolver and $ 3.1 million related to the new term loan).

In the third quarter of 2023, the Company paid $ 8.0 million for a b ridge facility for the Lima acquisition.

Upon the completion of the amendment to the Enovis Credit Agreement and 2028 Notes offering, the bridge facility was terminated and the unamortized balance of the bridge facility deferred financing fees of $ 7.3 million was written-off.

As of December 31, 2023, the Company has $ 13.8 million of original issue discount fees and other issuance costs included as a reduction of Long-term debt related to the 2028 Notes.

Contractual Maturities

2 unchanged sentences

(In thousands)

2023 $ 219,468

Total contractual maturities 480,000

1 unchanged sentence

Total debt $ 466,164

On March 19, 2021, the Company completed the underwritten public offering of 5.4 million shares of Colfax Common stock, as adjusted for the reverse stock split, resulting in net proceeds of approximately $ 711.3 million, after deducting offering expenses and underwriters’ discount and commissions.

On July 28, 2021, the Company issued 2.2 million shares of Colfax Common stock, as adjusted for the reverse stock split, to the former shareholders of Mathys for acquisition consideration of $ 285.7 million.

Share Repurchase Program

On February 12, 2018, the Company’s Board of Directors authorized the repurchase of up to $ 100 million of the Company’s Common stock from time-to-time on the open market or in privately negotiated transactions.

The Board of Directors increased the repurchase authorization by an additional $ 100 million on June 6, 2018.

On July 19, 2018, the Board of Directors increased the repurchase authorization by another $ 100 million.

On February 12, 2018, the Company’s Board of Directors authorized the repurchase of shares of the Company’s common stock from time-to-time on the open market or in privately negotiated transactions.

No repurchases of the Company’s common stock have been made under this plan since the third quarter of 2018.

As of December 31, 2023, the remaining stock repurchase authorization provided by the Board of Directors was $ 100 million .

The timing, amount and method of shares repurchased is determined by management based on its evaluation of market conditions and other factors.

During the year ended December 31, 2018, the Company repurchased 2,149,808 shares, as adjusted for the reverse stock split, of our Common stock in open market transactions for $ 200 million.

Since 2018, there have been no repurchases made under this program.

As of December 31, 2022, the remaining stock repurchase authorization by the Company’s Board of Directors was $ 100 million .

There is no term associated with the remaining repurchase authorization.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accumulated Other Comprehensive Loss

1 unchanged sentence

All amounts are net of tax and noncontrolling interest, if any.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accumulated Other Comprehensive Loss Components

3 unchanged sentences

Other comprehensive income (loss) before reclassifications:

Net actuarial loss ( 8,169 ) — — ( 8,169 )

Net actuarial gain 20,866 — — 20,866

Foreign currency translation adjustment 1,339 ( 146,409 ) ( 230 ) ( 145,300 )

Gain on long-term intra-entity foreign currency transactions — 32,261 — 32,261

Loss on net investment hedges — — ( 26,268 ) ( 26,268 )

Gain on net investment hedges — — 23,247 23,247

Other comprehensive income (loss) before reclassifications:

22,205 ( 114,148 ) 23,017 ( 68,926 )

Amounts reclassified from Accumulated other comprehensive loss (1)

5 unchanged sentences

Foreign currency translation adjustment 470 ( 37,953 ) — ( 37,483 )

Gain on long-term intra-entity foreign currency transactions — 32,261 — 32,261

Loss on long-term intra-entity foreign currency transactions — ( 21,779 ) — ( 21,779 )

Gain on net investment hedges — — 9,028 9,028

2 unchanged sentences

Amounts reclassified from Accumulated other comprehensive loss (1)

5,019 — — 5,019

Net Other comprehensive income (loss) 13,306 ( 59,732 ) 9,028 ( 37,398 )

Distribution of ESAB Corporation 84,460 469,220 ( 53,699 ) 499,981

Balance at December 31, 2022 12,207 ( 65,637 ) — ( 53,430 )

Other comprehensive income (loss) before reclassifications:

Net actuarial gain 12,207 — — 12,207

Net actuarial loss ( 8,052 ) — — ( 8,052 )

Foreign currency translation adjustment 2,829 63,621 — 66,450

Loss on long-term intra-entity foreign currency transactions — ( 21,779 ) — ( 21,779 )

Gain on net investment hedges — — 9,028 9,028

Loss on net investment hedges — — ( 27,943 ) ( 27,943 )

Other comprehensive income (loss) before reclassifications:

1 unchanged sentence

Amounts reclassified from Accumulated other comprehensive loss (1)

( 1,976 ) — 70 ( 1,906 )

Net Other comprehensive income (loss) ( 7,199 ) 63,621 ( 27,873 ) 28,549

Distribution of ESAB Corporation 84,460 469,220 ( 53,699 ) 499,981

Balance at December 31, 2023 $ 5,008 $ ( 2,016 ) $ ( 27,873 ) $ ( 24,881 )

3 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the years ended December 31, 2022, 2021 and 2020, Noncontrolling interest decreased by $ 2.1 million, $ 1.3 million, and $ 2.6 million, respectively, as a result of Other comprehensive income, primarily due to foreign currency translation adjustment.

During the years ended December 31, 2023, 2022 and 2021, Noncontrolling interest increased (decreased) by $ 0.1 million, $( 2.1 ) million, and $( 1.3 ) million, respectively, as a result of Other comprehensive income, due to foreign currency translation adjustment.

Share-Based Payments

14 unchanged sentences

Deferred tax benefit 2,813 1,236 2,658

(1) Stock-based compensation expense includes $ 2.1 million, $ 7.7 million and $ 6.6 million of expense included in Income from discontinued operations on the Company’s Consolidated Statements of Operations for the years ended December 31, 2022, 2021 and 2020, respectively.

(1) Stock-based compensation expense includes $ 2.1 million and $ 7.7 million of expense included in Income from discontinued operations on the Company’s Consolidated Statements of Operations for the years ended December 31, 2022 and 2021 , respectively.

As of December 31, 2023, the Company had $ 25.1 million of unrecognized compensation expense related to stock-based awards that will be recognized over a weighted-average period of 1.1 years.

16 unchanged sentences

$ 26.36 $ 27.48 $ 27.64

(1) The weighted-average fair value of options granted in 2021 and 2020 have been adjusted by a factor of 1.7 due to the Separation and reverse stock split.

(1) The weighted-average fair value of options granted in 2021 was adjusted by a factor of 1.7 due to the Separation and reverse stock split.

As a result of the Separation, beginning in April 2022, expected volatility is based on the weighted average historical stock price volatility of a group of peer companies for the expected term of the option.

10 unchanged sentences

Outstanding at January 1, 2021

2,705,070 $ 50.61

Granted 331,375 65.08

5 unchanged sentences

Forfeited and expired ( 407,069 ) 72.53

Adjustment due to ESAB Separation (3)

( 425,651 ) 57.64

Outstanding at December 31, 2022 1,347,677 59.96

2 unchanged sentences

Forfeited and expired ( 40,727 ) 67.85

Adjustment due to ESAB Separation (3)

( 425,651 ) 57.64

Outstanding at December 31, 2023 1,496,143 59.71 3.23 $ 4,474

1 unchanged sentence

Exercisable at December 31, 2023 1,159,675 58.26 2.57 4,474

(1) The outstanding options as of December 31, 2021 and the option activity prior to December 31, 2021 have been adjusted by a factor of 1.7 due to the Separation and reverse stock split.

(1) The outstanding options as of December 31, 2021 was adjusted by a factor of 1.7 due to the Separation and reverse stock split.

(2) The aggregate intrinsic value is based upon the difference between the Company’s closing stock price at the date of the Consolidated Balance Sheet and the exercise price of the stock option for in-the-money stock options.

10 unchanged sentences

The awards also have a service requirement that equals the respective performance periods.

The final achievement of all outstanding PRSU awards was determined as of April 4, 2022 based on the current performance as of the time of the Separation.

It was determined that 100 % of the TSR metric was achieved for the PRSUs granted during the years ended December 31, 2022 and 2021, while 70 % of the TSR metric was achieved for the PRSUs granted during the year ended December 31, 2020.

The final achievement of the PRSUs granted in 2022 and 2021 was determined as of April 4, 2022 based on the current performance as of the time of the Separation, and it was determined that 100 % of the TSR metric was achieved .

The achievement factors were determined in accordance with the applicable criteria established by the Compensation Committee.

18 unchanged sentences

Forfeited and expired ( 35,516 ) 46.07 ( 70,914 ) 69.22

Adjustment due to ESAB Separation (2)

( 32,373 ) 46.07 ( 131,291 ) 71.52

Nonvested at December 31, 2022 260,797 77.34 503,279 71.33

2 unchanged sentences

Forfeited and expired — — ( 44,857 ) 63.43

Adjustment due to ESAB Separation (2)

( 32,373 ) 46.07 ( 131,291 ) 71.52

Nonvested at December 31, 2023 217,201 69.97 507,981 63.59

(1) The outstanding awards as of December 31, 2021 and the award activity prior to December 31, 2021, have been adjusted by a factor of 1.7 due to the Separation and reverse stock split.

(1) The outstanding awards as of December 31, 2021 has been adjusted by a factor of 1.7 due to the Separation and reverse stock split.

(2) Reflects the cancellation of unvested awards held by ESAB employees as of April 4, 2022, which were replaced with ESAB awards issued by ESAB as part of the Separation.

The fair value of shares vested during the years ended December 31, 2023, 2022 and 2021 was $ 31.8 million, $ 32.1 million , and $ 18.3 million, respectively.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The fair value of shares vested during the years ended December 31, 2022, 2021 and 2020 was $ 32.1 million , $ 18.3 million and $ 9.7 million, respectively.

On January 11, 2019, the Company issued $ 460 million in TEUs with a 5.75 % interest rate, comprised of 4.6 million units at $ 100 per unit.

Total cash of $ 447.7 million was received upon closing.

The proceeds from the issuance of the TEUs were allocated 84.4 % to equity (the “TEU prepaid stock purchase contracts”) and 15.6 % to debt (the “TEU amortizing notes”) based on the relative fair value of the respective components of each TEU.

See Note 13, “Debt” for additional information on the TEU amortizing notes.

The TEU prepaid stock purchase contracts were mandatorily converted into shares of Company common stock on January 15, 2022, unless previously settled at the holder’s option.

All the TEU prepaid stock purchase contracts converted at the minimum settlement rate.

Approximately 1.3 million and 3.3 million TEU prepaid stock purchase contracts were settled into approximately 1.7 million and 4.4 million shares of Company common stock, as adjusted for the reverse stock split, during the years ended December 31, 2022 and 2021, respectively.

Since the 4.6 million TEU prepaid stock purchase contracts were mandatorily converted into shares of Company common stock at the minimum settlement rate or greater, 6.1 million shares, as adjusted for the reverse stock split, are included in basic net income per share calculations for all periods presented.

See Note 7, “Net Income Per Share from Continuing Operations” for additional information.

Accrued Liabilities

2 unchanged sentences

Accrued compensation and related benefits $ 70,979 $ 51,384

Accrued taxes 13,676 12,970

Accrued freight 3,955 5,299

Contingent consideration - current portion 8,812 1,816

Warranty liability- current portion 2,804 2,503

Accrued restructuring liability - current portion 1,090 2,170

Accrued third-party commissions 28,539 24,958

Customer advances and billings in excess of costs incurred 3,560 9,203

Lease liability - current portion 21,568 24,281

Accrued interest 2,921 11,066

Accrued rebates 14,464 13,715

Accrued taxes 14,384 13,676

Accrued professional fees 13,037 15,670

Contingent consideration - current portion 6,944 8,812

Accrued royalties 5,972 5,777

Accrued freight 3,909 3,955

Accrued interest 3,765 2,921

Warranty liability 2,959 2,804

Customer advances and billings in excess of costs incurred 2,953 3,560

Accrued restructuring liability 2,276 1,091

Other 45,383 37,688

2 unchanged sentences

The Company’s restructuring programs include a series of actions to reduce the structural costs of the Company.

A summary of the activity in the Company’s restructuring liability included in Accrued liabilities and Other liabilities in the Consolidated Balance Sheets is as follows:

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

A summary of the activity in the Company’s restructuring liability included in Accrued liabilities in the Consolidated Balance Sheets is as follows:

Year Ended December 31, 2023

11 unchanged sentences

(2) Includes the cost of relocating associates, relocating equipment, lease termination expense, and other costs in connection with the closure and optimization of facilities and product lines.

(3) The Company’s charges include $ 1.7 million classified as Cost of sales on the Company’s Consolidated Statements of Operations for the year ended December 31, 2022.

The remaining $ 17.2 million of restructuring expense is recorded as Restructuring and other charges on the Company’s Consolidated statements of Operations for the year ended December 31, 2022.

(4) As of December 31, 2022, all of the restructuring liability was included in Accrued liabilities.

(5) $ 9.6 million and $ 9.4 million of the Company’s total provisions is related to the Prevention & Recovery and Reconstructive segments, respectively.

(3) Charges includes $ 2.6 million of expense classified as Cost of sales on the Company’s Consolidated Statements of Operations.

$ 13.5 million and $ 6.4 million of the Company’s total provisions are related to the Prevention & Recovery and Reconstructive segments, respectively.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2022

4 unchanged sentences

$ 2,470 $ 3,944 $ ( 5,441 ) $ — $ 973

Facility closure costs (2)

Facility closure costs and other (2)

358 12,864 ( 13,104 ) — 118

4 unchanged sentences

(2) Includes the cost of relocating associates, relocating equipment and lease termination expense in connection with the closure and optimization of facilities and product lines.

(3) The Company’s charges include $ 5.2 million classified as Cost of sales on the Company’s Consolidated Statements of Operations for the year ended December 31, 2021.The remaining $ 8.7 million of restructuring expense is recorded as Restructuring and other charges on the Company’s Consolidated statements of Operations for the year ended December 31, 2021.

(4) As of December 31, 2021, all of the restructuring liability was included in Accrued liabilities.

In the Accrued liabilities table above, $ 0.4 million and $ 0.3 million of the Company’s restructuring liability is included in Accrued compensation and related benefits and Other, respectively.

(5) $ 11.5 million and $ 2.4 million of the Company’s total provisions is related to the Prevention & Recovery and Reconstructive segments, respectively.

(3) Charges include $ 1.7 million classified as Cost of sales on the Company’s Consolidated Statements of Operations.

$ 9.6 million and $ 9.4 million of the Company’s total provisions are related to the Prevention & Recovery and Reconstructive segments, respectively.

Defined Benefit Plans

4 unchanged sentences

defined benefit and other post-retirement plans, formerly sponsored by the Company, were transferred to ESAB as of March 21, 2022.

As a result of the transfer, the related net plan obligations of approximately $ 70 million are reflected as discontinued operations within the Company’s Consolidated Balance Sheet as of December 31, 2021.

The impact of transferring the plans to ESAB is shown as Divestitures in the tables

The impact of transferring the plans to ESAB is shown as Divestitures in the tables below.

The following tables include all defined benefit plans historically sponsored by the Company prior to the transfer to ESAB.

See Note 4, “Discontinued Operations” for further information.

The following table summarizes the total changes in the Company’s pension benefits and plan assets and includes a statement of the plans’ funded status.

The amounts presented as of January 1, 2022 and the changes in benefit obligation and plan assets in 2022 include three months of activity of the ESAB plans prior to the Separation.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following tables include all plans historically sponsored by the Company prior to the transfer to ESAB.

See Note 4, “Discontinued Operations” for further information.

The following table summarizes the total changes in the Company’s pension and accrued post-retirement benefits and plan assets and includes a statement of the plans’ funded status.

The amounts presented as of December 31, 2021 and the changes in benefit obligation and plan assets in 2022 include three months of activity of the ESAB plans prior to the Separation.

Pension Benefits Other Post-Retirement Benefits

Total Pension Benefits Foreign Pension Benefits

Year Ended December 31, Year Ended December 31,

3 unchanged sentences

Projected benefit obligation, beginning of year $ 95,075 $ 455,067 $ 252,739

Acquisitions (1)

— 101,312 — —

Service cost 3,709 4,703 4,703

Interest cost 2,122 1,821 897

Actuarial gain (2)

Actuarial loss (gain) (1)

11,465 ( 21,586 ) ( 21,586 )

Foreign exchange effect 10,946 ( 4,844 ) ( 4,844 )

Benefits paid ( 5,724 ) ( 22,073 ) ( 231 ) ( 812 )

Transfers in (benefits paid), net (2)

6,407 ( 5,724 ) ( 1,854 )

Divestitures (3)

— ( 337,045 ) ( 137,663 )

Settlements ( 8,655 ) — —

Other 1,274 2,683 2,683

3 unchanged sentences

Fair value of plan assets, beginning of year $ 77,696 $ 366,820 $ 165,561

Acquisitions (1)

Actual return on plan assets 4,173 ( 4,193 ) ( 6,557 )

1 unchanged sentence

Foreign exchange effect 8,696 ( 2,599 ) ( 2,599 )

Benefits paid ( 5,724 ) ( 22,073 ) ( 231 ) ( 812 )

Transfers in (benefits paid), net (2)

6,407 ( 5,724 ) ( 1,854 )

Divestitures (3)

5 unchanged sentences

Amounts recognized on the Consolidated Balance Sheet at December 31:

Non-current assets (5)

$ — $ 7,733 $ — $ —

Current liabilities

3 unchanged sentences

Total $ ( 27,671 ) $ ( 17,379 ) $ ( 17,379 )

(1) Acquisitions for 2021 relate to our acquisition of Mathys.

See Note 5, “Acquisitions”, for further information.

(2) The actuarial gains for 2022 and 2021 are primarily due to the increases in discount rates in most markets.

(1) The actuarial loss for 2023 is primarily due to the decrease in discount rate in the Swiss market and the gain for 2022 is primarily due to the increases in discount rates in most markets.

(2) Transfers in (benefits paid), net are positive for 2023 due to transfers in for new members.

(3) Divestitures are related to the Separation.

(4) Settlements includes $ 11.2 million classified as Pension settlement gain included in discontinued operations for 2021, when independent trustees of a company pension plan agreed to merge that plan with another company pension plan and contribute its surplus assets.

(5) As of December 31, 2021, all of the non-current plan assets are associated with discontinued operations.

(6) As of December 31, 2021, current pension liabilities and non-current pension liabilities of $ 3.4 million and $ 62.2 million, respectively, are associated with discontinued operations.

Additionally, all of the other post-retirement benefits liabilities are associated with discontinued operations.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

As of December 31, 2022, all remaining Enovis plans had projected benefit obligations in excess of the fair value of plan assets.

As of December 31, 2021, for pension plans with projected benefit obligations in excess of plan assets, the projected benefit obligation and fair value of plan assets were $ 185.0 million and $ 87.5 million, respectively.

The projected benefit obligation decreased by $ 360.0 million in the year ended December 31, 2022 compared to an increase of $ 75.8 million in the year ended December 31, 2021.

As of December 31, 2023 and 2022, all Enovis plans had projected benefit obligations in excess of the fair value of plan assets.

The projected benefit obligation increased by $ 27.3 million in the year ended December 31, 2023 compared to a decrease of $ 360.0 million in the December 31, 2022.

In the year ended December 31, 2023, the increase was mainly driven by two key factors:

an actuarial loss of $ 11.5 million and the exchange rate effect of $ 10.9 million (as a result of the U.S.

currency weakening relative to other currencies).

In the year ended December 31, 2022, the single largest driver was a decrease of $ 337.0 million due to the divestiture of ESAB.

In addition, there was an actuarial gain of $ 21.6 million.

In the year ended December 31, 2021, the single largest driver was an increase of $ 101.3 million from the Mathys acquisition.

This was offset by benefits paid of $ 22.1 million, a foreign exchange gain of $ 6.6 million, and an actuarial gain of $ 11.2 million, of which approximately $ 7.8 million related to domestic pension plans and $ 3.4 million related to foreign pension plans.

The following table summarizes the changes in the Company’s foreign pension benefit obligation, which is determined based upon an employee’s expected date of separation, and plan assets, included in the table above, and includes a statement of the plans’ funded status.

The amounts presented as of December 31, 2021 and the changes in benefit obligation and plan assets in 2022 include three months of activity of the ESAB plans prior to the Separation.

Foreign Pension Benefits

Year Ended December 31,

(In thousands)

Change in benefit obligation:

Projected benefit obligation, beginning of year $ 252,739 $ 157,195

Acquisitions (1)

Service cost 4,703 3,719

Interest cost 897 1,741

Actuarial loss (gain) (2)

( 21,586 ) ( 3,449 )

Foreign exchange effect ( 4,844 ) ( 6,569 )

Benefits paid ( 1,854 ) ( 7,122 )

Divestitures (3)

( 137,663 ) —

Other 2,683 5,912

Projected benefit obligation, end of year $ 95,075 $ 252,739

Accumulated benefit obligation, end of year $ 91,527 $ 244,946

Change in plan assets:

Fair value of plan assets, beginning of year $ 165,561 $ 73,114

Acquisitions (1)

Actual return on plan assets ( 6,557 ) 5,665

Employer contribution 3,378 6,350

Foreign exchange effect ( 2,599 ) ( 1,374 )

Benefits paid ( 1,854 ) ( 7,122 )

Divestitures (3)

Settlements (4)

Other 2,510 5,393

Fair value of plan assets, end of year $ 77,696 $ 165,561

Funded status, end of year $ ( 17,379 ) $ ( 87,178 )

(1) Acquisitions in the year ended December 31, 2021 relate to our acquisition of Mathys.

See Note 5, “Acquisitions”, for further information.

(2) The actuarial gains for 2022 and 2021 are primarily due to the increases in discount rates in all markets.

(3) Divestitures are related to the Separation.

(4) Settlements includes $ 11.2 million classified as Pension settlement gain included in discontinued operations for the year ended December 31, 2021.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Expected contributions to the Company’s pension plans for the year ending December 31, 2024 are $ 3.5 million.

The following benefit payments are expected to be paid during each respective fiscal year:

Pension Benefits

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(In thousands)

9 unchanged sentences

Equity securities 35 % 35 % 25 % - 43 %

International 15 %

Fixed income 38 %

Cash and cash equivalents 1 %

Foreign Plans:

Equity securities 35 % 28 % 25 %- 43 %

Fixed income securities 28 % 27 % 24 % - 43 %

1 unchanged sentence

Other 35 % 36 % 25 % - 45 %

(1) As of December 31, 2022, all U.S.

plans have been divested as a result of the Separation.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

A summary of the Company’s pension plan assets for each fair value hierarchy level for the periods presented follows (see Note 17, “Financial Instruments and Fair Value Measurements”, for further description of the levels within the fair value hierarchy):

2 unchanged sentences

(In thousands)

Foreign Plans:

Cash and cash equivalents $ — $ 2,406 $ — $ — $ 2,406

5 unchanged sentences

December 31, 2022

Measured at Net Asset Value (1)

Measured at Net Asset Value(1) Level

(In thousands)

Cash and cash equivalents $ — $ 1,250 $ — $ — $ 1,250

$ — $ 1,699 $ — $ — $ 1,699

Equity securities — 27,074 — — 27,074

large cap 52,810 — — — 52,810

small/mid cap 21,983 15,501 — — 37,484

International 31,094 — — — 31,094

Fixed income mutual funds:

government and corporate 77,084 — — — 77,084

— 1,088 — — 1,088

Foreign Plans:

Cash and cash equivalents — 3,029 — — 3,029

Equity securities — 46,475 — — 46,475

government and corporate bonds — 21,224 — — 21,224

1 unchanged sentence

$ — $ 49,548 $ 28,148 $ — $ 77,696

(1) Certain investments that are measured at fair value using the NAV have not been classified in the fair value hierarchy.

These investments, consisting primarily of common/collective trusts, are valued using the NAV provided by the Trustee.

The NAV is based on the underlying investments held by the fund, that are traded in an active market, less its liabilities.

These investments are able to be redeemed in the near-term.

(2) The weighted-average interest crediting rates received in Cash and cash equivalents of U.S plans are immaterial relative to total plan assets.

(1) Represents diversified portfolio funds, reinsurance contracts and money market funds.

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table sets forth the components of Net periodic benefit (income) cost and Other comprehensive (gain) loss of the Company’s defined benefit pension plans and other post-retirement employee benefit plans:

Pension Benefits Other Post-Retirement Benefits

Year Ended December 31, Year Ended December 31,

The following table sets forth the components of Net periodic benefit cost (income) and Other comprehensive (gain) loss of the Company’s defined benefit pension plans and other post-retirement employee benefit plans:

Pension Benefits

Year Ended December 31,

2023 2022 2021

4 unchanged sentences

Amortization ( 1,759 ) 1,187 5,953

Settlement (gain) loss — ( 11,157 ) 99 — — —

Settlement gain ( 578 ) — ( 11,157 )

Other — ( 20 ) 2

Expected return on plan assets ( 3,032 ) ( 4,789 ) ( 12,819 )

Net periodic benefit (income) cost $ 2,902 $ ( 9,660 ) $ 1,816 $ 29 $ 94 $ 90

Net periodic benefit cost (income) $ 462 $ 2,902 $ ( 9,660 )

Change in Plan Assets and Benefit Obligations Recognized in Other Comprehensive (Gain) Loss:

6 unchanged sentences

Total recognized in Other comprehensive (gain) loss $ 10,367 $ ( 15,694 ) $ ( 33,400 )

Net periodic benefit (income) cost of $ 0.3 million, $( 9.9 ) million, and $ 2.4 million, for the years ended December 31, 2022, 2021 and 2020, respectively are included in Income from discontinued operations.

Each component of Net periodic benefit (income) cost from continuing operations is included in Selling, general and administrative expense.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table sets forth the components of Net periodic benefit (income) cost and Other comprehensive (gain) loss of the foreign defined benefit pension plans, included in the table above:

Net periodic benefit cost (income) of $ 0.3 million and $( 9.9 ) million for the years ended December 31, 2022 and 2021, respectively are included in Income from discontinued operations.

The following table sets forth the components of Net periodic benefit cost (income) and Other comprehensive (gain) loss of the foreign defined benefit pension plans for the years ended December 31, 2022 and 2021 included in the table above:

Foreign Pension Benefits

Year Ended December 31,

2022 2021 2020

(In thousands)

3 unchanged sentences

Amortization 273 1,223

Settlement (gain) loss — ( 11,157 ) 99

Settlement gain — ( 11,157 )

Other ( 20 ) 2

Expected return on plan assets ( 2,425 ) ( 3,015 )

Net periodic benefit (income) cost $ 3,428 $ ( 7,487 ) $ 2,840

Net periodic benefit cost (income) $ 3,428 $ ( 7,487 )

Change in Plan Assets and Benefit Obligations Recognized in Other Comprehensive (Gain) Loss:

6 unchanged sentences

Total recognized in Other comprehensive (gain) loss $ ( 14,780 ) $ ( 8,862 )

The components of net unrecognized pension and other post-retirement benefit cost included in Accumulated other comprehensive income (loss) in the Consolidated Balance Sheets that have not been recognized as a component of Net periodic benefit (income) cost are as follows:

Pension Benefits Other Post-Retirement

December 31, December 31,

2022 2021 2021

(In thousands)

Net actuarial loss (gain) $ ( 16,620 ) $ 72,612 $ ( 2,573 )

Prior service cost 488 412 —

Total $ ( 16,132 ) $ 73,024 $ ( 2,573 )

The key economic assumptions used in the measurement of the Company’s pension and other post-retirement benefit obligations are as follows:

Pension Benefits Other Post-Retirement

December 31, December 31,

2022 2021 2022 2021

Weighted-average discount rate:

All plans 2.2 % 1.7 % — % 2.6 %

Foreign plans 2.2 % 1.2 % — % — %

Weighted-average rate of increase in compensation levels for active foreign plans 1.5 % 0.9 % — % — %

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The components of net unrecognized pension benefit cost included in Accumulated other comprehensive income (loss) in the Consolidated Balance Sheets that have not been recognized as a component of Net periodic benefit (income) cost are as follows:

(In thousands)

Net actuarial gain $ ( 4,681 ) $ ( 16,620 )

Prior service (income) cost ( 1,084 ) 488

Total $ ( 5,765 ) $ ( 16,132 )

The key economic assumptions used in the measurement of the Company’s pension benefit obligations are as follows:

Weighted-average discount rate for all plans 1.5 % 2.2 %

Weighted-average rate of increase in compensation levels for active plans 1.5 % 1.5 %

The key economic assumptions used in the computation of Net periodic benefit (income) cost are as follows:

Pension Benefits Other Post-Retirement Benefits

Year Ended December 31, Year Ended December 31,

Year Ended December 31,

2023 2022 2021

5 unchanged sentences

Foreign plans 2.8 % 3.6 %

Weighted-average rate of increase in compensation levels for active foreign plans 1.7 % 0.6 % 0.8 % — % — % — %

Weighted-average rate of increase in compensation levels for active plans 1.5 % 1.7 % 0.6 %

In determining discount rates, the Company utilizes the single discount rate equivalent to discounting the expected future cash flows from each plan using the yields at each duration from a published yield curve as of the measurement date.

2 unchanged sentences

The Company’s expense in continuing operations for the years ended December 31, 2023, 2022 and 2021 was $ 8.1 million, $ 6.6 million and $ 5.4 million, respectively.

Prior to the Separation, the Company sponsored other post-retirement benefit plans with unfunded liabilities of $ 11.9 million at the time of the Separation with annual costs of approximately $ 0.1 million.

See prior filings for expanded disclosures related to these plans transferred to ESAB as part of the Separation.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Financial Instruments and Fair Value Measurements

7 unchanged sentences

The carrying values of financial instruments, including Trade receivables, other receivables and Accounts payable, approximate their fair values due to their short-term maturities.

The estimated fair value of the Company’s debt of $ 0.3 billion and $ 2.1 billion as of December 31, 2022 and 2021, respectively, was based on current interest rates for similar types of borrowings and is in Level Two of the fair value hierarchy.

The estimated fair value of the Company’s debt of $ 573.2 million and $ 259.3 million as of December 31, 2023 and 2022, respectively, was based on current interest rates for similar types of borrowings and is in Level Two of the fair value hierarchy.

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the balance sheet date or that will be realized in the future.

1 unchanged sentence

The fair value of the contingent consideration liabilities is determined using unobservable inputs and the inputs vary based on the nature of the purchase agreements.

These inputs can include the estimated amount and timing of projected cash flows, the risk-adjusted discount rate used to present value the projected cash flows, and the probability of the

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

acquired company attaining certain targets stated within the purchase agreements.

These inputs can include the estimated amount and timing of projected cash flows, the risk-adjusted discount rate used to present value the projected cash flows, and the probability of the acquired company attaining certain targets stated within the purchase agreements.

A change in these unobservable inputs to a different amount might result in a significantly higher or lower fair value measurement at the reporting date due to the nature of uncertainty inherent to the estimates.

During the year ended December 31, 2022, the company recorded contingent consideration of $ 20.1 million in conjunction with current acquisitions as well as an adjustment to reduce contingent consideration by $ 3.3 million from a prior acquisition, which was reflected in Selling, general and administrative expense in the Consolidated Statements of Operations.

The gross range of outcomes for contingent consideration arrangements that have a fixed limit is zero to $ 8.5 million.

There are two contingent consideration arrangements that have no limits and are based on a percentage of sales in excess of a benchmark over a one-year period and five-year period, respectively.

There were no other transfers in or out of Level One, Two or Three during the years ended December 31, 2022 and 2021.

A summary of the Company’s assets and liabilities that are measured at fair value on a recurring basis for each fair value hierarchy level for the periods presented is as follows:

December 31, 2022

(In thousands)

Deferred compensation plans $ — $ 10,324 $ — $ 10,324

$ — $ 10,324 $ — $ 10,324

Foreign currency contracts - not designated as hedges $ — $ 35 $ — $ 35

Deferred compensation plans — 10,324 — 10,324

Contingent consideration — — 22,808 22,808

$ — $ 10,359 $ 22,808 $ 33,167

December 31, 2021

There is one contingent consideration arrangement as of December 31, 2023 that has no limit and is based on a percentage of sales in excess of a benchmark over a five-year period.

There were no other transfers in or out of Level One, Two or Three during the year ended December 31, 2023.

Total Contingent Consideration Rollforward

Beginning Balance Additions Charges Interest Payments Foreign Exchange Ending Balance

(In thousands)

Foreign currency contracts - not designated as hedges $ — $ 5 $ — $ 5

Deferred compensation plans — 11,213 — 11,213

$ — $ 11,218 $ — $ 11,218

Foreign currency contracts - not designated as hedges $ — $ 260 $ — $ 260

Deferred compensation plans — 11,213 — 11,213

Contingent Consideration $ 27,809 $ 1,818 $ ( 832 ) $ — $ ( 2,736 ) $ ( 33 ) $ 26,026

$ — $ 11,473 $ 5,000 $ 16,473

Deferred Compensation Plans

5 unchanged sentences

As a result, the Company enters into foreign currency swaps and forward contracts to mitigate this exchange rate risk.

As the Company’s borrowings under the Credit Facility include variable interest rates, the

As the Company’s borrowings under the Credit Facility include variable interest rates, the Company may periodically enter into interest rate swap or collar agreements to mitigate interest rate risk.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Company may periodically enter into interest rate swap or collar agreements to mitigate interest rate risk.

Commodity derivative contracts can be used to manage costs of raw materials used in the Company’s production processes.

derivative contracts can be used to manage costs of raw materials used in the Company’s production processes.

There were no changes during the periods presented in the Company’s valuation techniques used to measure asset and liability fair values on a recurring basis.

Foreign Currency Contracts

Foreign currency contracts are measured using broker quotations or observable market transactions in either listed or over-the-counter markets.

The Company primarily uses foreign currency contracts to mitigate the risk associated with customer forward sale agreements denominated in currencies other than the applicable local currency, and to match costs and expected revenues where production facilities have a different currency than the selling currency.

As of December 31, 2022 and 2021, the Company had foreign currency contracts related to purchases and sales with notional values of $ 0.8 million and $ 7.6 million, respectively.

The Company recognized the following in its Consolidated Financial Statements related to its derivative instruments:

Cash Flow Hedges

The Company’s objective in using forward currency contracts is to add stability to the Company’s earnings and to protect the U.S.

Dollar value of forecasted transactions.

To accomplish this objective, the Company has entered into forward currency contract agreements between the U.S.

Dollar and the Mexican Peso as part of its risk management strategy.

These forward currency contract agreements are designated and qualify as cash flow hedges.

The gain or loss on a derivative instrument designated as a cash flow hedge is recorded in Unrealized gain (loss) on hedging activities, net of tax within the Company’s Consolidated Statements of Comprehensive Income (Loss) until the underlying third-party transaction occurs.

When the underlying third-party transaction occurs, the Company recognizes the gain or loss in earnings within Cost of Sales in its Consolidated Statements of Operations.

The contracts are recorded at fair value and deemed to be Level Two in the fair value hierarchy.

At December 31, 2023, the Company’s forward currency contracts have a Mexican Peso notional amount of approximately $ 840.0 million, equivalent to a U.S.

Dollar aggregate notional amount of $ 47.9 million.

During the year ended December 31, 2023, the Company recognized a realized gain of $ 0.2 million on its Consolidated Statements of Operations related to its forward currency contracts designated as cash flow hedges.

There was nothing recognized in 2022 as the Mexican Peso forward currency program was established in the second quarter of 2023.

Net Investment Hedges

On April 18, 2023, the Company entered into cross-currency swap agreements to hedge its net investment in its Swiss Franc-denominated subsidiaries against adverse movements in exchange rates between the U.S.

Dollar and the Swiss Franc.

These swap agreements are designated and qualify as net investment hedges.

These contracts have a Swiss Franc notional amount of approximately ₣ 403 million and a U.S.

Dollar aggregate notional amount of $ 450 million at December 31, 2023.

Cross-currency swaps involve the receipt of functional-currency fixed-rate amounts from a counterparty in exchange for the Company making foreign-currency fixed-rate payments over the life of the agreement.

For derivatives designated as net investment hedges, the gain or loss on the derivative is reported in the Consolidated Balance Sheet as part of Accumulated other comprehensive income (loss) and in the Company’s Consolidated Statements of Comprehensive Income (Loss) as part of the foreign currency translation adjustment.

Amounts are reclassified out of Accumulated other comprehensive loss into earnings when the hedged net investment is either sold or substantially liquidated.

During the three months and year ended December 31, 2023, the Company received interest income on its cross-currency swap derivatives of $ 2.6 million and $ 7.3 million, respectively, which is included within Interest expense, net in the Consolidated Statements of Operations.

The following table presents the effect of the Company’s designated hedging instruments on Accumulated other comprehensive income (loss) for the year ended December 31, 2023 and 2022:

Year Ended December 31,

2022 2021 2020

(In thousands)

Contracts Designated as Hedges:

Unrealized gain (loss) on net investment hedges (1)

Gain (loss) on cross-currency swaps $ ( 36,893 ) $ —

Gain (loss) on forward currency contracts 247 —

$ ( 36,646 ) $ —

Contracts Not Designated in a Hedge Relationship:

Foreign Currency Contracts:

Unrealized gain (loss) ( 35 ) ( 255 ) —

Realized gain (loss) ( 577 ) ( 104 ) —

(1) The unrealized gain (loss) on net investment hedges is attributable to the change in valuation of Euro denominated debt.

In 2022, the Euro denominated debt was extinguished upon the Separation.

Non-Designated Hedging Instruments

The Company also used non-designated forward currency contracts for the purpose of managing its exposure to currency exchange rate risk related to the Euro-denominated purchase price of Novastep and Lima, which closed in June 2023 and January 2024, respectively.

During the second quarter of 2023, the Company recognized a realized loss of $ 1.5 million on its Consolidated Statements of Operations related to the settlement of the Novastep non-designated forward currency contract.

The loss is recorded in Other income, net on the Consolidated Statements of Operations.

During the fourth quarter of 2023, the Company recorded an unrealized gain of $ 24.3 million on its Consolidated Statements of Operations related to the outstanding

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Lima non-designated forward currency contracts.

The gain is recorded in Other income, net on the Consolidated Statements of Operations.

The Lima forward remained outstanding as of December 31, 2023 and was subsequently settled on January 3, 2024 upon the closing of the Lima acquisition for a realized gain of $ 13.2 million, which will reflect a loss of $ 11.1 million in the first quarter of 2024.

The following table presents the fair value of the Company’s derivative financial instruments as well as their classification on the Consolidated Balance Sheets as of December 31, 2023 and 2022:

(In thousands) Location on

Consolidated Balance Sheets (1)

Derivative Assets

Designated Hedging Instruments

Forward currency contracts Other current assets $ 432 $ —

Cross-currency swaps Other current assets 10,061 —

Non-Designated Hedging Instruments

Forward currency contracts Other current assets 24,311 —

Total Derivative Assets $ 34,804 $ —

Derivative Liabilities

Designated Hedging Instruments

Forward currency contracts Accrued liabilities $ 278 $ —

Cross-currency swaps Other long-term liabilities 46,953 —

Total Derivative Liabilities $ 47,231 $ —

(1) The Company classifies derivative assets and liabilities as current when the settlement date of the contract is one year or less.

Concentration of Credit Risk

6 unchanged sentences

General Litigation

The Company is involved in various pending legal proceedings arising out of the ordinary course of the Company’s business.

None of these legal proceedings are expected to have a material adverse effect on the financial condition, results of operations or cash flow of the Company.

With respect to these proceedings and the litigation and claims described in the preceding paragraphs, management of the Company believes that it will either prevail, has adequate insurance coverage or has established appropriate accruals to cover potential liabilities.

The Company is involved in various pending legal, regulatory and other proceedings arising out of the ordinary course of the Company’s business.

None of these proceedings are expected to have a material adverse effect on the financial condition, results of operations or cash flow of the Company.

With respect to these proceedings, management of the Company believes that it will either prevail, has adequate insurance coverage or has established appropriate accruals to cover potential liabilities.

Legal costs related to proceedings or claims are recorded when incurred.

1 unchanged sentence

There can be no assurance, however, as to the ultimate outcome of any of these matters, and if all or substantially all of these legal proceedings were to be determined adverse to the Company, there could be a material adverse effect on the financial condition, results of operations or cash flow of the Company.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Off-Balance Sheet Arrangements

As of December 31, 2023, the Company had $ 145.9 million of unconditional purchase obligations with suppliers, the majority of which is expected to be paid by December 31, 2023.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Segment Information

29 unchanged sentences

(In thousands)

Loss from continuing operations before income taxes (GAAP) $ ( 2,069 ) $ ( 121,781 ) $ ( 119,006 )

Loss from continuing operations before income taxes $ ( 67,128 ) $ ( 2,069 ) $ ( 121,781 )

Restructuring and other charges (1)

13 unchanged sentences

Gain on cost basis investment — ( 8,800 ) —

Other income ( 2,088 ) — —

Other income, net ( 25,663 ) ( 2,088 ) —

Adjusted EBITDA (non-GAAP) 269,227 236,070 205,996

3 unchanged sentences

(3) Insurance settlement gain is related to the 2019 acquisition of DJO.

2022 2021 (1)

(In thousands)

3 unchanged sentences

Total $ 4,509,334 $ 4,273,248

(1) Represents assets from continuing operations including allocation of centrally managed cash and cash equivalents.

Total assets related to discontinued operations was $ 3.7 billion.

(1) Includes allocation of certain centrally managed assets, including cash and cash equivalents.

The detail of the Company’s operations by geography is as follows:

15 unchanged sentences

Mexico 8,006 6,605

Australia 3,528 3,002

France 5,529 3,058

Other foreign locations 11,975 11,618

1 unchanged sentence

(1) As the Company does not allocate all long-lived assets (specifically intangible assets) to each individual country, evaluation of long-lived assets in total is impracticable.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Selected Quarterly Data—(unaudited)

Provided below is selected unaudited quarterly financial data for the years ended December 31, 2022 and 2021.

Quarter Ended

September 30,

(In thousands, except per share data)

Net sales $ 375,457 $ 395,117 $ 383,814 $ 408,713

Gross profit 205,900 215,906 215,824 231,753

Net income (loss) from continuing operations ( 38,055 ) 120,651 ( 65,949 ) ( 54,836 )

Income (loss) from discontinued operations, net of taxes 54,356 ( 43,666 ) ( 527 ) 16,267

net income attributable to noncontrolling interest from continuing operations - net of taxes 267 130 136 34

net income attributable to noncontrolling interest from discontinued operations - net of taxes 966 — — —

Net income (loss) attributable to Enovis Corporation 15,068 76,855 ( 66,612 ) ( 38,603 )

Net income (loss) per share - basic

Continuing operations $ ( 0.76 ) $ 2.23 $ ( 1.22 ) $ ( 1.01 )

Discontinued operations $ 1.04 $ ( 0.81 ) $ ( 0.01 ) $ 0.30

Consolidated operations $ 0.28 $ 1.42 $ ( 1.23 ) $ ( 0.71 )

Net income (loss) per share - diluted

Continuing operations $ ( 0.76 ) $ 2.21 $ ( 1.22 ) $ ( 1.01 )

Discontinued operations $ 1.04 $ ( 0.80 ) $ ( 0.01 ) $ 0.30

Consolidated operations $ 0.28 $ 1.41 $ ( 1.23 ) $ ( 0.71 )

(1) The results for the quarter ended July 1, 2022 include the impact of a $ 135.5 million gain on the Company’s investment in ESAB, an insurance settlement gain of $ 33.0 million and debt extinguishment charges of $ 20.1 million.

(2) The results for the quarter ended September 30, 2022 include the impact of a $ 63.1 million loss on the Company’s investment in ESAB and an $ 8.8 million gain on the Company’s investment in Insight.

(3) The results for the quarter ended December 31, 2022 include income tax expense of $ 52.3 million which includes tax impacts associated with transaction costs, a $ 30.3 million gain on the Company’s investment in ESAB, and an insurance settlement gain of $ 4.6 million.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Quarter Ended

2021 December 31,

(In thousands, except per share data)

Net sales $ 311,083 $ 356,124 $ 359,923 $ 399,058

Gross profit 171,282 200,593 197,876 207,924

Net loss from continuing operations ( 31,854 ) ( 42,127 ) ( 13,578 ) ( 14,694 )

Income from discontinued operations, net of taxes

52,094 71,829 40,435 14,173

net income attributable to noncontrolling interest from continuing operations - net of taxes 290 355 191 216

net income attributable to noncontrolling interest from discontinued operations - net of taxes 876 705 818 1,170

Net income (loss) attributable to Enovis Corporation 19,074 28,642 25,848 ( 1,907 )

Net income (loss) per share - basic

Continuing operations $ ( 0.69 ) $ ( 0.83 ) $ ( 0.26 ) $ ( 0.28 )

Discontinued operations $ 1.10 $ 1.39 $ 0.75 $ 0.24

Consolidated operations $ 0.41 $ 0.56 $ 0.49 $ ( 0.04 )

Net income (loss) per share - diluted

Continuing operations $ ( 0.69 ) $ ( 0.83 ) $ ( 0.26 ) $ ( 0.28 )

Discontinued operations $ 1.10 $ 1.39 $ 0.75 $ 0.24

Consolidated operations $ 0.40 $ 0.56 $ 0.49 $ ( 0.04 )

(1) The results for the quarter ended July 2, 2021 include a $ 29.9 million impact from debt extinguishment charges.

Subsequent Events

Lima Acquisition

On January 3, 2023, the Company completed a business combination in its Reconstructive segment of LimaCorporate S.p.A.

(“Lima”), a privately held global orthopedic company focused on restoring motion through digital innovation and customized hardware.

“Acquisitions and Investments” and Note 13.

“Debt” in the Notes to the Consolidated Financial Statements included in this Form 10-K for additional information regarding the acquisition and the financing of the acquisition.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

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