What changed in this filing

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Item 1. Financial Statements

2025-05-08 compared with 2024-11-06 · 198 added, 284 removed, 397 unchanged (55% of the section changed)

3 unchanged sentences

Dollars in thousands, except per share amounts

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

Three Months Ended

April 4, 2025 March 29, 2024

Net sales $ 558,834 $ 516,266

4 unchanged sentences

Amortization of acquired intangibles 41,812 40,931

Purchase of royalty interest 35,777 —

Restructuring and other charges 3,862 12,911

1 unchanged sentence

Interest expense, net 9,188 19,996

Other (income) expense, net ( 202 ) ( 757 ) ( 9,803 ) ( 665 )

Other expense, net 1,392 24,235

Loss from continuing operations before income taxes ( 57,349 ) ( 79,245 )

1 unchanged sentence

Net loss from continuing operations ( 55,580 ) ( 71,841 )

Income from discontinued operations, net of taxes 2,243 16,611 2,175 21,096

Loss from discontinued operations, net of taxes ( 125 ) —

Net loss ( 55,705 ) ( 71,841 )

9 unchanged sentences

Dollars in thousands

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

Three Months Ended

April 4, 2025 March 29, 2024

Net loss $ ( 55,705 ) $ ( 71,841 )

7 unchanged sentences

Reclassification of hedging gain (loss), net of tax expense (benefit) of $( 118 ) and $ 58

( 536 ) 168 ( 894 ) 168

Other comprehensive income (loss) 63,024 ( 40,548 )

Comprehensive loss ( 9,383 ) ( 17,909 ) ( 151,653 ) ( 35,316 )

comprehensive income (loss) attributable to noncontrolling interest 359 ( 12 ) 574 394

Comprehensive loss attributable to Enovis Corporation $ ( 9,742 ) $ ( 17,897 ) $ ( 152,227 ) $ ( 35,710 )

Comprehensive income (loss) 7,319 ( 112,389 )

comprehensive income attributable to noncontrolling interest 383 106

Comprehensive income (loss) attributable to Enovis Corporation $ 6,936 $ ( 112,495 )

See Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

Dollars in thousands, except share amounts

September 27, 2024 December 31, 2023

April 4, 2025 December 31, 2024

CURRENT ASSETS:

24 unchanged sentences

133,333,333 shares authorized;

55,866,099 and 54,597,142 shares issued and outstanding as of September 27, 2024 and December 31, 2023, respectively

57,118,641 and 55,876,517 shares issued and outstanding as of April 4, 2025 and December 31, 2024, respectively

Additional paid-in capital 3,021,690 2,973,121

Retained earnings 420,314 542,471

Accumulated deficit ( 338,989 ) ( 283,023 )

Accumulated other comprehensive loss ( 64,990 ) ( 127,892 )

7 unchanged sentences

Dollars in thousands, except share amounts

Common Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss Noncontrolling Interest Total

Common Stock Additional Paid-In Capital (Accumulated Deficit) Retained Earnings Accumulated Other Comprehensive Loss Noncontrolling Interest Total

Shares Amount

1 unchanged sentence

Net income (loss) — — — ( 55,966 ) — 261 ( 55,705 )

Other comprehensive loss, net of tax of $ 7,752

— — — — ( 40,497 ) ( 51 ) ( 40,548 )

Payments of tax withholding for stock-based awards — — ( 4,772 ) — — — ( 4,772 )

Common stock-based award activity 243,439 — 7,302 — — — 7,302

Balance at March 29, 2024 54,840,581 55 2,903,277 470,473 ( 65,378 ) 2,415 3,310,842

Net income (loss) — — — ( 18,638 ) — 126 ( 18,512 )

Other comprehensive loss, net of tax of $( 2,131 )

— — — — ( 11,352 ) ( 17 ) ( 11,369 )

Common stock-based award activity 25,779 — 7,977 — — — 7,977

Balance at June 28, 2024 54,866,360 55 2,911,254 451,835 ( 76,730 ) 2,524 3,288,938

Net income (loss) — — — ( 31,521 ) 259 ( 31,262 )

Other comprehensive loss, net of tax of $( 16,933 )

Other comprehensive income, net of tax benefit of $( 13,185 )

— — — — 62,902 122 63,024

Common stock issued for acquisition 971,343 1 44,409 — — — 44,410

Payments of tax withholding for stock-based awards — — ( 3,447 ) — — — ( 3,447 )

Common stock-based award activity 270,781 7,607 — — — 7,607

Balance at September 27, 2024 55,866,099 56 2,964,997 420,314 ( 54,951 ) 2,883 3,333,299

Common Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss Noncontrolling Interest Total

Balance at April 4, 2025 57,118,641 $ 57 $ 3,021,690 $ ( 338,989 ) $ ( 64,990 ) $ 2,450 $ 2,620,218

Common Stock Additional Paid-In Capital (Accumulated Deficit) Retained Earnings Accumulated Other Comprehensive Loss Noncontrolling Interest Total

Shares Amount

1 unchanged sentence

Net income (loss) — — — ( 71,998 ) — 157 ( 71,841 )

Other comprehensive income, net of tax of $ —

Other comprehensive loss, net of tax of $ 7,752

— — — — ( 40,497 ) ( 51 ) ( 40,548 )

Payments of tax withholding for stock-based awards — — ( 4,772 ) — — — ( 4,772 )

Common stock-based award activity 243,439 — 7,302 — — — 7,302

Balance at March 29, 2024 54,840,581 $ 55 $ 2,903,277 $ 470,473 $ ( 65,378 ) $ 2,415 $ 3,310,842

Net income (loss) — — — ( 9,995 ) — 182 ( 9,813 )

Other comprehensive income, net of tax of $( 1,781 )

— — — — 4,972 8 4,980

Common stock-based award activity 40,957 1 10,321 — — — 10,322

Balance at June 30, 2023 54,534,111 55 2,944,094 542,387 ( 37,898 ) 2,122 3,450,760

Net income (loss) — — — ( 2,880 ) — 40 ( 2,840 )

Other comprehensive income, net of tax of $ 934

— — — — ( 15,017 ) ( 52 ) ( 15,069 )

Common stock-based award activity 30,886 — 8,881 — — — 8,881

Balance at September 29, 2023 54,564,997 $ 55 $ 2,952,975 $ 539,507 $ ( 52,915 ) $ 2,110 $ 3,441,732

See Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

Dollars in thousands

Nine Months Ended

September 27, 2024 September 29, 2023

Three Months Ended

April 4, 2025 March 29, 2024

Cash flows from operating activities:

Net loss $ ( 55,705 ) $ ( 71,841 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization 71,435 73,404

Impairment of assets 5,555 —

Stock-based compensation expense 7,407 6,431

Non-cash interest expense 1,348 1,245

Fair value gain on contingent acquisition shares ( 19,922 ) —

Fair value loss on contingent acquisition shares 1,787 13,443

Loss on currency hedges — 11,123

Deferred income tax benefit ( 1,769 ) ( 9,966 )

Loss on sale of property, plant and equipment ( 2,116 ) ( 14,832 )

(Gain) loss on sale of property, plant and equipment ( 527 ) 265

Changes in operating assets and liabilities:

3 unchanged sentences

Other operating assets and liabilities 9,511 ( 25,448 )

Net cash provided by operating activities 25,174 66,573

Net cash used in operating activities ( 1,596 ) ( 36,156 )

Cash flows from investing activities:

Purchases of property, plant and equipment and intangibles ( 43,262 ) ( 36,928 )

Proceeds from sale of property, plant and equipment — 42,571

Payments for acquisitions, net of cash received, and investments ( 18,858 ) ( 760,914 )

Payment for settlement of derivatives ( 4,645 ) —

Cash received upon settlement of derivatives 1,601 —

Net cash used in investing activities ( 60,519 ) ( 797,842 )

10 unchanged sentences

Effect of foreign exchange rates on Cash and cash equivalents 1,217 ( 828 )

Increase (decrease) in Cash, cash equivalents and restricted cash ( 5,034 ) 7,834

Cash, cash equivalents and restricted cash, beginning of period 44,832 24,295

Cash, cash equivalents and restricted cash, end of period $ 39,798 $ 32,129

Increase (decrease) in Cash and cash equivalents ( 9,707 ) 29,714

Cash and cash equivalents, beginning of period 48,167 44,832

Cash and cash equivalents, end of period $ 38,460 $ 74,546

Supplemental disclosures - Non-cash investing activities:

14 unchanged sentences

Actual results may differ from those estimates.

During the three months ended September 27, 2024, due to a decrease in the share price of our common stock and market capitalization, the Company identified a possible impairment indicator as of September 27, 2024 and determined it was appropriate to perform interim quantitative assessments of Goodwill for the Reconstructive and Prevention & Recovery reporting units.

Based on these assessments, no impairment was identified.

Recently Issued Accounting Pronouncements

The Company has not adopted any new accounting standards during the nine months ended September 27, 2024.

There are no recently issued accounting pronouncements that are expected to have a material effect on the Company’s financial position, results of operations or cash flows.

The Company adopted (“ASU”) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures as of December 31, 2024 .

The adoption did not have a material impact on the Company’s Consolidated Financial Statements but did require updates to the presentation of certain information for the Company’s segment disclosures.

See Note 13 “Segment Information” for additional information regarding the updates made.

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

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, at an enterprise value of € 800 million (the “Lima Acquisition”), consisting of (i) approximately € 700 million in cash consideration, which includes the repayment at closing of certain indebtedness of Lima and (ii) 1,942,686 shares of common stock of Enovis, par value $ 0.001 per share (the “Contingent Acquisition Shares”), based upon a € 100 million value divided by the thirty-day volume weighted average price of Enovis common stock as of the close of business on September 21, 2023.

The Contingent Acquisition Shares are issuable in two equal tranches within six and twelve months of the acquisition date upon non-occurrence of certain future events, in each case subject to certain adjustments and conditions as provided for in the purchase agreement.

The first tranche of 971,343 Contingent Acquisition Shares was issued to the seller on July 16, 2024.

The Company currently expects the second tranche of Contingent Acquisition Shares to be issued in the first quarter of 2025.

The cash paid for acquisition was $ 757.7 million, net of acquired cash.

The fair value of the Contingent Acquisition Shares at closing was $ 107.9 million based on the Enovis share price at the close of business on January 3, 2024.

The Contingent Acquisition Shares liability, recorded in Accrued liabilities, is adjusted to fair value each reporting period with the adjustment reflected in Other income (expense), net in the Condensed Consolidated Statement of Operations.

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Lima operates in the reconstructive space of patient care, providing tailored hardware and digital innovation to advance a global standard of care and positive patient outcomes.

Lima has approximately 1,000 employees across more than 15 locations around the world.

The Lima Acquisition extends the Company’s current footprint to emerging and growing markets, expands its product lines, and strengthens its global innovation platform.

The value included as Goodwill for the Lima acquisition is reflective of these expected benefits in conjunction with anticipated synergies as the Company uses its integration experience effectively to drive further operating improvement, margin expansion, and long-term growth.

Enovis uses its experience and EGX business management system, a comprehensive set of tools and repeatable, teachable processes, to integrate acquisitions and create superior value for its customers, shareholders and associates.

The Company incurred $ 9.7 million of advisory, legal, audit, valuation and other professional service fees in connection with the Lima Acquisition in the first quarter of 2024, which are included in Selling, general and administrative expense in the Condensed Consolidated Statement of Operations.

The Lima Acquisition was accounted for as a business combination using the acquisition method of accounting and accordingly, the Condensed Consolidated Financial Statements include the financial position and results of operations from the date of acquisition.

The following unaudited proforma financial information presents Enovis’s consolidated financial information assuming the acquisition had taken place on January 1, 2023.

These amounts are presented in accordance with GAAP, consistent with the Company’s accounting policies.

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

(In thousands)

Net Sales $ 505,222 $ 483,001 $ 1,546,648 $ 1,469,691

Net loss from continuing operations attributable to Enovis ( 23,094 ) ( 47,741 ) ( 110,519 ) ( 147,926 )

The following table summarizes the Company’s provisional estimate of the aggregate fair value of the assets acquired and liabilities assumed at the date of acquisition.

These amounts, including inventories, deferred taxes, intangible assets, useful lives of the intangible assets, and property, plant and equipment, are determined based upon certain valuations and studies that have yet to be finalized.

Accordingly, the assets acquired and liabilities assumed, as detailed below, are subject to adjustment once the detailed analyses are completed, which could be material.

Substantially all of the Goodwill recognized is not expected to be deductible for income tax purposes.

January 3, 2024

(In thousands)

Trade receivables $ 79,710

Inventories 133,547

Property, plant and equipment 123,093

Goodwill 326,158

Intangible assets 363,000

Accounts payable ( 36,871 )

Accrued liabilities ( 51,642 )

Other assets and liabilities, net ( 71,411 )

Total fair value of consideration, net of acquired cash 865,584

fair value of Contingent Acquisition Shares ( 107,877 )

Acquisition consideration paid, net of acquired cash $ 757,707

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following summarizes the preliminary values of the Intangible assets acquired, excluding Goodwill, as of September 27, 2024:

Intangible Asset Weighted Average Amortization Period

Trademarks $ 50,000 20

Customer Relationships 148,000 15

Acquired technology 165,000 15

Total Intangible Assets $ 363,000

During the three and nine months ended September 27, 2024, the Company’s Condensed Consolidated Statements of Operations included $ 68.4 million and $ 237.6 million, of net sales and $ 4.0 million and $ 15.9 million of net loss, respectively, associated with the acquired Lima legal entities.

2025 Acquisitions

On June 28, 2023, the Company completed the acquisition of Novastep SAS (“Novastep”) in its Recon 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 as a business combination using 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 allocated $ 43.7 million to goodwill and $ 52.0 million to intangible assets acquired.

The purchase accounting related to the Novastep acquisition has been completed.

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.

On July 20, 2023, the Company completed an asset acquisition transaction with D.N.E., LLC (“DNE”) in its Recon 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 Condensed 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 Pty Ltd (“Precision AI”), a developer of surgical planning software.

The transaction was accounted for as an asset acquisition.

The acquisition complements the Company’s current product offerings in its Recon 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.

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 seller.

In August 2024, the second milestone was achieved and the Company paid $ 4.2 million to the seller.

The third milestone completion date was extended into the first quarter of 2025.

As of September 27, 2024, the total intangible asset recorded for this acquisition is $ 33.5 million.

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

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

The potential additional contingent payments are not recorded until the milestones are achieved.

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

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 Condensed Consolidated Balance Sheets.

Restricted cash is recorded as a component of Other current assets on the Condensed Consolidated Balance Sheets.

The balance in restricted cash as of

In the first quarter of 2025, the Company completed five bolt-on acquisitions for $ 30.0 million total purchase consideration, including deferred consideration and estimated contingent consideration.

Three acquisitions are in the Prevention & Recovery segment and two are in the Reconstructive segment.

For the acquisitions in P&R, the Company paid a total of $ 7.1 million, net of cash received, and estimated contingent consideration for future expected payments of $ 1.9 million to acquire two companies.

Additionally, the Company paid $ 6.5 million in cash and recorded a $ 8.3 million deferred consideration liability for an asset acquisition.

The acquisitions added complementary product offerings to the P&R segment.

For the acquisitions in Recon, the Company paid a total of $ 5.3 million, net of cash received, and estimated contingent consideration for future expected payments of $ 0.9 million to acquire two companies, both of which are distribution partners for the Company’s surgical implant products in Europe.

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

September 27, 2024 and December 31, 2023 is related to the acquisition of Precision AI which closed in the fourth quarter of 2023 and will be released to the seller within one year of the acquisition date upon completion of certain milestones.

The following table summarizes the Company’s cash, cash equivalents and restricted cash:

September 27, 2024 December 31, 2023

(In thousands)

Cash and cash equivalents

$ 35,425 $ 36,191

Restricted cash

Total cash and cash equivalents and restricted cash

$ 39,798 $ 44,832

As of September 27, 2024, the balance of investments held by the Company without readily determinable fair values was $ 20.4 million.

The business acquisitions are 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 dates.

The Company preliminarily recorded approximately $ 30.9 million in definite-lived intangible assets associated with the acquisitions.

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

2024 Acquisitions

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

(“Lima”), a privately held global orthopedic company, at an enterprise value of € 800 million (the “Lima Acquisition”), consisting of (i) approximately € 700 million in cash consideration, which includes the repayment at closing of certain indebtedness of Lima and (ii) 1,942,686 shares of common stock of Enovis, par value $ 0.001 per share (the “Contingent Acquisition Shares”), based upon a € 100 million value divided by the 30-day volume weighted average price of Enovis common stock as of the close of business on September 21, 2023.

The Contingent Acquisition Shares were issuable in two equal tranches within six and twelve months of the acquisition date upon non-occurrence of certain future events, in each case subject to certain adjustments and conditions as provided for in the purchase agreement.

The first tranche of Contingent Acquisition Shares was issued to the seller on July 16, 2024 and the second tranche was issued on January 15, 2025.

The cash paid for acquisition was $ 757.7 million, net of acquired cash.

Since the acquisition occurred at the beginning of 2024, the results of operations are fully included in both periods presented, and the purchase accounting was finalized as of December 31, 2024.

See Note 5, “Acquisitions” in the Notes to Consolidated Financial Statements in the Company’s 2024 Form 10-K for further information regarding the Lima Acquisition.

The Company also completed one asset acquisition in its Reconstructive segment in the second quarter of 2024 and one business acquisition in its Prevention & Recovery segment in the third quarter of 2024 for aggregate purchase consideration of $ 4.0 million.

As of April 4, 2025, the balance of investments held by the Company without readily determinable fair values was $ 20.4 million.

The majority of these investments are carried at cost less 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.

4 unchanged sentences

The Company disaggregates its revenue into the following geographic/product type groups within its segments:

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

Three Months Ended

April 4, 2025 March 29, 2024

(In thousands)

9 unchanged sentences

Total $ 558,834 $ 516,266

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

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

3 unchanged sentences

The Company’s 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.

In calculating and applying its current expected

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

credit losses, the Company disaggregates trade receivables into business segments due to risk characteristics unique to each segment given the individual lines of business and market.

In calculating and applying its current expected credit losses, the Company disaggregates trade receivables into business segments due to risk characteristics unique to each segment given the individual lines of business and market.

The business segments are further disaggregated based on either geography or product type.

2 unchanged sentences

A summary of the activity in the Company’s allowance for credit losses included within Trade receivables in the Condensed Consolidated Balance Sheets is as follows:

Nine Months Ended September 27, 2024

Three Months Ended April 4, 2025

of Period Charged to Expense, net Write-Offs, Deductions, net Other Activity, net (1)

5 unchanged sentences

Net income (loss) per share from continuing operations was computed using the treasury stock method as follows:

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

Three Months Ended

April 4, 2025 March 29, 2024

(In thousands, except share and per share data)

17 unchanged sentences

(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 continuing operations component of the income attributable to noncontrolling interest, net of taxes.

The following weighted average computations of potentially dilutive shares of Common stock from stock-based compensation awards were excluded from the calculation of Weighted-average shares of Common stock outstanding – diluted as inclusion would be anti-dilutive in Net income (loss) per share:

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

Weighted average computation of potentially dilutive shares of Common stock excluded from diluted computation, as inclusion would be anti-dilutive

1,720,628 1,073,464 1,311,385 1,127,227

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

In conjunction with the Lima Acquisition, the Company agreed to a contingent issuance of 1,942,686 Contingent Acquisition Shares in two equal tranches within six and twelve months from the completion of the Lima Acquisition upon the non-occurrence of certain future events, in each case subject to certain adjustments and conditions as provided for in the purchase agreement.

The first tranche of 971,343 Contingent Acquisition Shares was issued to the seller on July 16, 2024.

The Company currently expects the second tranche of Contingent Acquisition Shares to be issued in the first quarter of 2025.

The Contingent Acquisition Shares are only to be included in the weighted-average calculation of basic shares when there are no circumstances the shares would not be issued.

The Contingent Acquisition Shares are only to be included in the weighted-average calculation of diluted shares when the conditions are satisfied.

As such, the shares associated with the second tranche have been excluded from the calculation of basic and diluted weighted-average shares, respectively.

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

The following table presents the potentially dilutive shares of Common stock from stock-based compensation awards excluded from the calculation of Weighted-average shares of Common stock outstanding – diluted as inclusion would be anti-dilutive in Net income (loss) per share (“Anti-dilutive shares”):

Three Months Ended

April 4, 2025 March 29, 2024

Anti-dilutive shares 1,867,454 835,218

In conjunction with the Lima Acquisition, the Company agreed to a contingent issuance of 1,942,686 Contingent Acquisition Shares in two equal tranches within six and twelve months of the acquisition date upon the non-occurrence of certain future events, in each case subject to certain adjustments and conditions as provided for in the purchase agreement.

The first tranche of Contingent Acquisition Shares was issued to the seller on July 16, 2024 and the second tranche was issued on January 15, 2025.

The Contingent Acquisition Shares were only included in the weighted-average calculation of basic shares when there were no circumstances the shares would not be issued.

Three Months Ended

April 4, 2025 March 29, 2024

(In thousands)

2 unchanged sentences

Effective tax rate:

21.4 % 23.7 % 17.0 % 23.9 %

The effective tax rate for the three months ended September 27, 2024 was higher than the 2024 federal statutory rate of 21%, primarily due to tax credits for research and development, non-U.S.

income taxed at lower rates, non-taxable fair value gain on the Contingent Acquisition Shares, and release of uncertain tax positions.

This was partially offset by an increase in valuation allowance on interest limitation carryforwards, non-deductible expenses, and U.S.

taxation on international operations.

The effective tax rate for the nine months ended September 27, 2024 was lower than the 2024 federal statutory rate of 21%, primarily due to an increase in valuation allowance on interest limitation carryforwards, non-deductible expenses, and U.S.

The effective tax rate for the three months ended April 4, 2025 was lower than the 2025 federal statutory rate of 21%, primarily due to an increase in valuation allowance on interest limitation carryforwards, non-deductible expenses, and U.S.

taxation on international operations.

This was partially offset by tax credits for research and development, non-U.S.

income taxed at lower rates, and non-taxable fair value gain on the Contingent Acquisition Shares.

The effective tax rate for the three and nine months ended September 29, 2023 was higher than the 2023 U.S.

federal statutory rate of 21%, primarily due to non-U.S.

income being taxed at lower rates, the release of a valuation allowance on non-U.S.

attributes, tax credits for research and development, and release of uncertain tax positions.

This was partially offset by other non-deductible expenses and the U.S.

This was partially offset by tax credits for research and development and non-U.S.

income taxed at lower rates.

The effective tax rate for the three months ended March 29, 2024 was lower than the 2024 U.S.

federal statutory rate of 21%, primarily due to an increase in valuation allowance on interest limitation carryforwards, non-deductible expenses and U.S.

taxation on international operations.

This was partially offset by tax credits for research and development and non-U.S.

income taxed at lower rates.

ENOVIS CORPORATION

3 unchanged sentences

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

As of September 27, 2024, the remaining stock repurchase authorization provided by the Board of Directors was $ 100 million.

As of April 4, 2025, 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.

1 unchanged sentence

Accumulated Other Comprehensive Income (Loss)

The following tables present the changes in the balances of each component of Accumulated other comprehensive income (loss) including reclassifications out of Accumulated other comprehensive loss for the nine months ended September 27, 2024 and September 29, 2023.

The following tables present the changes in the balances of each component of Accumulated other comprehensive income (loss) including reclassifications out of Accumulated other comprehensive loss for the three months ended April 4, 2025 and March 29, 2024.

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

4 unchanged sentences

Other comprehensive income (loss) before reclassifications:

Net actuarial gain

Foreign currency translation adjustment ( 3 ) 104,809 — 104,806

3 unchanged sentences

Net Other comprehensive income (loss) ( 29 ) 104,809 ( 41,878 ) 62,902

Balance at September 27, 2024 $ 4,907 $ 4,915 $ ( 64,773 ) $ ( 54,951 )

Balance at April 4, 2025 $ 8,383 $ ( 8,855 ) $ ( 64,518 ) $ ( 64,990 )

Accumulated Other Comprehensive Loss Components

5 unchanged sentences

Foreign currency translation adjustment ( 396 ) ( 65,043 ) — ( 65,439 )

Loss on hedge activity — — ( 2,290 ) ( 2,290 )

Gain on hedge activity — — 24,791 24,791

Other comprehensive income (loss) before reclassifications ( 396 ) ( 65,043 ) 24,791 ( 40,648 )

1 unchanged sentence

Net Other comprehensive income (loss) ( 431 ) ( 65,043 ) 24,977 ( 40,497 )

Balance at September 29, 2023 $ 11,094 $ ( 61,887 ) $ ( 2,122 ) $ ( 52,915 )

Balance at March 29, 2024 $ 4,577 $ ( 67,059 ) $ ( 2,896 ) $ ( 65,378 )

ENOVIS CORPORATION

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Inventories, net consisted of the following:

September 27, 2024 December 31, 2023

April 4, 2025 December 31, 2024

(In thousands)

6 unchanged sentences

Long-term debt consisted of the following:

September 27, 2024 December 31, 2023

April 4, 2025 December 31, 2024

(In thousands)

6 unchanged sentences

Term Loan and Revolving Credit Facility

On April 4, 2022, the Company entered into a credit agreement (the “Enovis Credit Agreement”), consisting of a $ 900 million revolving credit facility (the “Revolver”) with an April 4, 2027 maturity date and an initial term loan in the aggregate principal amount of $ 450 million (the “2022 Term Loan”) which was fully extinguished during the first quarter of 2023.

The Company’s credit agreement (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 in an aggregate principal amount of $ 400 million, which 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, which is $ 5 million each quarter, and matures on April 4, 2027 (the “2024 Term Loan”).

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

subsidiaries of the Company guarantee the obligations under the Enovis Credit Agreement.

The agreement was amended on October 23, 2023, in conjunction with the financing of the Lima Acquisition as further discussed below.

The Enovis Credit Agreement, as amended, 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.

All facilities under the Enovis Credit Agreement (including the 2024 Term Loan Facility) are secured by certain personal property of the Company and certain of its subsidiaries, subject to limitations and exclusions.

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.

There are also restrictions on repayments of junior financing and amendments to junior financing documents.

In addition, the Enovis Credit Agreement contains financial covenants requiring the Company to maintain (i) a maximum senior secured leverage ratio of not more than 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 Credit Agreement.

As of September 27, 2024, the Company was in compliance with the covenants under the Enovis Credit Agreement.

As of September 27, 2024, the weighted-average interest rate of borrowings under the Enovis Credit Agreement was 7.16 % excluding accretion of deferred financing fees, and there was $ 385 million available on the Revolver.

Financing for Lima Acquisitio n

On October 23, 2023 the Company entered into an amendment to the Enovis Credit Agreement (the “Amendment”), which provided 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, which is $ 5 million each quarter, and matures on April 4, 2027 (the “2024 Term Loan”).

As of April 4, 2025, the Company was in compliance with the covenants under the Enovis Credit Agreement.

As of April 4, 2025, the weighted-average interest rate of borrowings under the Enovis Credit Agreement was 6.17 % excluding accretion of deferred financing fees, and there was $ 335 million available on the Revolver.

Convertible Notes and Capped Calls

The Company has $ 460 million aggregate principal senior unsecured convertible notes that were issued in October 2023 via a private placement pursuant to Rule 144A in conjunction with the financing for the Lima Acquisition (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,

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

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 2024 Term Loan) 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 adjusted to a new senior secured leverage ratio (as disclosed above);

(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.

beginning April 15, 2024 and will mature on October 15, 2028 unless earlier repurchased, redeemed, or converted.

The effective interest rate on the 2028 Notes is 4.6 %.

For the nine months ended September 27, 2024, the interest expense on the 2028 Notes was $ 15.1 million, including $ 13.2 million based upon the coupon rate and $ 1.9 million from accretion of the discount.

For the three months ended April 4, 2025, the interest expense on the 2028 Notes was $ 15.1 million, including $ 13.2 million based upon the coupon rate and $ 1.9 million from accretion of the discount.

Holders may convert their 2028 Notes in multiples of $1,000 principal amount prior to the close of business April 15, 2028 under the following circumstances:

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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.

There has been no redemptions or conversions of the 2028 Notes.

On October 24, 2023, 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.

There have been no redemptions or conversions of the 2028 Notes.

The Company also entered into privately negotiated capped call transactions in October 2023 with certain of the initial purchasers of the 2028 Notes in conjunction with the financing for the Lima Acquisition.

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 a dilutive effect and/or no offset of any cash payments, in each case, attributable to the amount by 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 Accounting Standards Codification Topic 815 Derivatives and Hedging.

Other Indebtedness

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 $ 24.6 million were outstanding as of September 27, 2024 .

Total letters of credit and surety bonds of $ 40.1 million were outstanding as of April 4, 2025 .

Deferred Financing Fees

The Compa ny has $ 2.7 million in deferred financing fees included in Other assets as of September 27, 2024.

As of September 27, 2024, the Company has $ 14.7 million of original issue discount fees and other issuance costs included as a reduction of Long-term debt related to the 2024 Term Loan and the 2028 Notes.

As of April 4, 2025, t he Company has $ 3.2 million in deferred financing fees included in Other assets related to the Revolver and $ 12.5 million of original issue discount fees and other issuance costs included as a reduction of Long-term debt related to the 2024 Term Loan and the 2028 Notes.

ENOVIS CORPORATION

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Accrued liabilities in the Condensed Consolidated Balance Sheets consisted of the following:

September 27, 2024 December 31, 2023

April 4, 2025 December 31, 2024

(In thousands)

Accrued compensation and related benefits $ 69,895 $ 85,989

Contingent consideration - current portion 50,601 5,972

Accrued third-party commissions 32,983 34,602

Lease liability - current portion 22,142 22,340

Derivative liability - current portion 21,150 278

Accrued taxes 19,732 21,341

Accrued rebates 15,097 19,964

Accrued professional fees 9,602 13,037

Accrued interest 11,737 5,841

Purchase of royalty interest 11,140 —

Accrued professional fees 10,009 5,003

Contingent consideration - current portion 8,656 49,719

Accrued royalties 7,061 6,296

Accrued freight 6,232 5,314

Customer advances and billings in excess of costs incurred 5,872 6,229

Accrued royalties 5,828 6,944

Warranty liability 2,662 2,818

Accrued restructuring liability 1,746 2,938

Derivative liability – current portion 517 3,648

Other 43,765 57,831

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

Nine Months Ended September 27, 2024

Three Months Ended April 4, 2025

Balance at Beginning of Period Provisions Payments Foreign Currency Translation Balance at End of Period

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Total Provisions (3)

(1) Includes severance and other termination benefits, including outplacement services, primarily related to employees in the Recon segment following the Lima Acquisition.

(2) Includes the cost of relocating associates, relocating equipment, lease termination expense and other costs in connection with the closure and optimization of P&R office sites, shared service centers, and our manufacturing sites in Tunisia and Tijuana.

(3) For the nine months ended September 27, 2024, $ 12.5 million and $ 10.1 million of the Company’s total provisions were related to the P&R and Recon segments, respectively.

The non-cash charges was an impairment of assets associated with divesting a minor product line in P&R.

(1) Includes severance and other termination benefits, including outplacement services.

(2) Includes the cost of relocating associates, relocating equipment, lease termination expense and other costs in connection with the closure and optimization of office sites, shared service centers, and manufacturing facilities.

(3) For the three months ended April 4, 2025, $ 2.9 million and $ 1.0 million of the Company’s total provisions were related to the P&R and Recon segments, respectively.

ENOVIS CORPORATION

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The carrying value of the Company’s term loan and revolving credit facility debt, which bears a variable interest rate indexed to the Secured Overnight Financing Rate (SOFR), approximates fair value as it reprices when market interest rates change.

Based on current interest rates for similar types of borrowings, the estimated fair value of the Company’s total debt, including the Senior unsecured convertible notes, the 2024 Term Loan, and the Revolver, was $ 1.4 billion and $ 573.2 million as of September 27, 2024 and December 31, 2023, respectively.

Based on current interest rates for similar types of borrowings, the estimated fair value of the Company’s total debt, including the Senior unsecured convertible notes, the 2024 Term Loan, and the Revolver, was $ 1.3 billion and $ 1.4 billion as of April 4, 2025 and December 31, 2024, respectively.

The estimated fair value, a Level Two valuation in the fair value hierarchy, 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.

As of September 27, 2024, the Company held $ 21.3 million in Level Three liabilities arising from contingent consideration related to acquisitions that may settle in cash.

As of April 4, 2025, the Company held $ 18.3 million in Level Three liabilities arising from contingent consideration related to acquisitions that may settle in cash.

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.

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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 nine months ended September 27, 2024, the Company recorded a net $ 4.7 million reduction in contingent consideration primarily due to $ 6.3 million in settlements of revenue-based contingent consideration arrangements.

During the three months ended April 4, 2025, the Company recorded a net increase in contingent consideration primarily due to $ 2.8 million from bolt-on acquisitions closed in the first quarter of 2025, partially offset by payments from a prior acquisition.

The gross range of outcomes for contingent consideration arrangements that have a fixed limit on the maximum payout is zero to $ 6.7 million.

There is one contingent consideration arrangement remaining that has no limit and is based on a percentage of sales in excess of a benchmark over a five -year period through 2027.

Additionally, in conjunction with the Lima Acquisition, the Company agreed to a contingent issuance of 1,942,686 Contingent Acquisition Shares, as determined based upon a € 100 million value divided by the thirty-day volume weighted average price of Enovis common stock as of the close of business on September 21, 2023.

The Contingent Acquisition Shares are expected to be issued in two equal tranches within six and twelve months of the acquisition date upon the non-occurrence of certain future events, in each case subject to certain adjustments and conditions as provided for in the purchase agreement.

The initial fair value of the Contingent Acquisition Shares at closing was $ 107.9 million based on the Enovis share price at the close of business on January 3, 2024.

The Contingent Acquisition Shares liability, recorded in Accrued liabilities, is adjusted to fair value each reporting period with the adjustments reflected in Other income (expense), net in the Condensed Consolidated Statement of Operations.

The adjustments were a loss of $ 0.1 million and a gain of $ 19.9 million for the three and nine months ended September 27, 2024, respectively.

The fair value of the Contingent Acquisition Shares liability is Level One in the fair value hierarchy as it is determined using the quoted market prices.

The first tranche of 971,343 Contingent Acquisition Shares was issued to the seller on July 16, 2024.

The Company currently expects the second tranche of Contingent Acquisition Shares to be issued in the first quarter of 2025.

There were no transfers in or out of Level One, Two or Three during the nine months ended September 27, 2024.

There is one contingent consideration arrangement remaining that has no limit and is based on a percentage of sales in excess of benchmark through 2027.

Additionally, in conjunction with the Lima Acquisition, the Company agreed to a contingent issuance of 1,942,686 Contingent Acquisition Shares in two equal tranches within six and twelve months of the acquisition date upon the non-occurrence of certain future events, in each case subject to certain adjustments and conditions as provided for in the purchase agreement.

The Contingent Acquisition Shares liability has been fully settled with the first tranche of Contingent Acquisition Shares issued to the seller on July 16, 2024 and the second tranche issued on January 15, 2025.

The liability, which was recorded in Accrued liabilities, was adjusted to fair value each reporting period with the adjustments reflected in Other expense, net in the Condensed Consolidated Statement of Operations.

The fair value adjustments were losses of $ 1.8 million and $ 13.4 million for the three months ended April 4, 2025 and three months ended March 29, 2024, respectively.

The fair value of the Contingent Acquisition Shares liability was Level One in the fair value hierarchy as it is determined using the quoted market prices.

There were no transfers in or out of Level One, Two or Three during the three months ended April 4, 2025.

ENOVIS CORPORATION

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Total Contingent Consideration $ 59,937 $ 2,844 $ 1,787 $ — $ ( 46,374 ) $ 149 $ 18,343

Purchase of royalty interest liability

In the first quarter of 2025, the Company entered into agreements to buyout the economic interest in future royalty payments under existing product development agreements related to certain of the Company’s U.S.

reconstructive products.

The gross payout under such agreements is $ 43.8 million, which will be paid over seven years.

The Company recorded a discounted liability and charge to the Condensed Consolidated Statements of Operations of $ 35.8 million, of which $ 11.1 million is recorded in Accrued liabilities and the non-current portion is recorded in Other liabilities on the Condensed Consolidated Balance Sheet.

Deferred Compensation Plans

The Company maintains deferred compensation plans for the benefit of certain employees and non-executive officers.

As of September 27, 2024 and December 31, 2023 the fair value of these plans were $ 17.0 million and $ 14.4 million, respectively.

As of April 4, 2025 and December 31, 2024 the fair value of these plans were $ 16.1 million and $ 17.0 million, respectively.

These plans are deemed to be Level Two within the fair value hierarchy.

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

At September 27, 2024, the Company’s forward currency contracts have a Mexican Peso notional amount of approximately $ 210.0 million and a U.S.

At April 4, 2025, the Company’s forward currency contracts have a Mexican Peso notional amount of approximately 763.0 million and a U.S.

Dollar aggregate notional amount of $ 37.6 million.

During the three and nine months ended September 27, 2024, the Company recognized a realized loss of $ 0.1 million and a realized gain of $ 0.4 million, respectively on its Condensed Consolidated Statements of Operations related to its forward currency contracts designated as cash flow hedges.

At September 29, 2023, the Company’s forward currency contracts have a Mexican Peso notional amount of approximately $ 1.05 billion and a U.S.

During the three months ended April 4, 2025, the Company recognized a realized loss of $ 1.1 million on its Condensed Consolidated Statements of Operations related to its forward currency contracts designated as cash flow hedges.

At March 29, 2024, the Company’s forward currency contracts have a Mexican Peso notional amount of approximately 630.0 million and a U.S.

Dollar aggregate notional amount of $ 35.9 million.

During the three and nine months ended September 29, 2023, the Company recognized a realized gain of $ 0.2 million on its Condensed Consolidated Statements of Operations related to its forward currency contracts designated as cash flow hedges.

During the three months ended March 29, 2024, the Company recognized a realized gain of $ 0.1 million on its Condensed Consolidated Statements of Operations related to its forward currency contracts designated as cash flow hedges.

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 were designated and qualified as net investment hedges.

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

Dollar aggregate notional amount of $ 450 million.

In April 2024, the ₣ 403 million cross-currency swap agreements designated as net investment hedges were de-designated and settled for $ 4.6 million which is reflected as a cash outflow within investing activities in the Consolidated Statements of Cash Flows.

The $ 0.7 million gain on settlement is reported in the Condensed Consolidated Balance Sheet as part of Accumulated other comprehensive income (loss) and in the Company’s Condensed Consolidated Statements of Comprehensive Income (Loss) as part of the foreign currency translation adjustment.

On April 8, 2024, April 12, 2024, and July 2, 2024, the Company entered into additional 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.

The Company has 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 swap agreements are designated and qualified as net investment hedges.

These contracts have a Swiss Franc notional amount of approximately ₣ 1.22 billion and a U.S.

Dollar aggregate notional amount of $ 1.35 billion as of September 27, 2024.

Dollar aggregate notional amount of $ 1.35 billion as of April 4, 2025.

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

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

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

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

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

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

During the three and nine months ended September 27, 2024, the Company received interest income on its cross-currency swap derivatives of $ 11.7 million and $ 19.9 million which is included within Interest expense, net in the Condensed 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 three and nine months ended September 27, 2024 and September 29, 2023:

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

The Company received interest income on its cross-currency swap derivatives of $ 12.2 million and $ 2.6 million for the three months ended April 4, 2025 and three months ended March 29, 2024, respectively, which is included within Interest expense, net in the Condensed Consolidated Statements of Operations.

The increased benefit reflects increased hedging activity entered into during the third quarter of 2024.

In January 2025, cross-currency swap agreements designated as net investment hedges with a ₣ 272 million Swiss Franc notional amount were de-designated and settled for a $ 1.6 million cash inflow reflected within investing activities in the Consolidated Statements of Cash Flows.

The $ 2.5 million gain on settlement is reported in the Condensed Consolidated Balance Sheet as part of Accumulated other comprehensive income (loss) and in the Company’s Condensed Consolidated Statements of Comprehensive Income (Loss) as part of the foreign currency translation adjustment.

The Company contemporaneously entered into new cross-currency swap agreements for the same Swiss Franc notional amount and designated them as a hedge of its net investment in its Swiss Franc-denominated subsidiaries.

In April 2024, cross-currency swap agreements designated as net investment hedges with a ₣ 403 million Swiss Franc notional amount were de-designated and settled for a $ 4.6 million cash outflow reflected within investing activities in the Consolidated Statements of Cash Flows.

The following table presents the effect of the Company’s designated hedging instruments on Accumulated other comprehensive income (loss) for the three months ended April 4, 2025 and March 29, 2024:

Three Months Ended

April 4, 2025 March 29, 2024

(In thousands)

Gain (loss) on cross-currency swaps $ ( 57,935 ) $ 31,391

Gain (loss) on forward currency contracts ( 343 ) ( 1,654 ) ( 2,285 ) ( 1,654 )

Gain on forward currency contracts 2,883 1,345

$ ( 55,052 ) $ 32,736

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In the first quarter of 2024, the Company recorded a loss of $ 11.1 million on its Consolidated Statements of Operations related to the exchange rate movements over the first three days of 2024.

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

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

From inception of the forward contracts on October 4, 2023 through the closing of the Lima Acquisition on January 3, 2024, the foreign currency forward contracts settled in an overall realized gain position of $ 13.4 million.

The following table presents the fair value of the Company’s derivative financial instruments as well as their classification on the Condensed Consolidated Balance Sheets as of September 27, 2024 and December 31, 2023:

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(In thousands) Location on Unaudited Consolidated Balance Sheets (1)

September 27, 2024 December 31, 2023

April 4, 2025 December 31, 2024

Derivative Assets

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Cross-currency swaps Other current assets 45,896 35,376

33,617 10,493

Non-Designated Hedging Instruments

Forward currency contracts Other current assets — 24,311

Total Derivative Assets $ 45,896 $ 35,376

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

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Commitments and Contingencies

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• Recon - an innovation market-leader positioned in the fast-growing surgical implant business, offering a comprehensive suite of reconstructive joint products for the hip, knee, shoulder, elbow, foot, ankle, and finger, and surgical productivity tools.

The Company’s management, including the chief operating decision maker, evaluates the operating results of each of its reportable segments based upon Net sales and Adjusted EBITDA, which excludes the effect of Other (income) expense, net, non-operating (gain) loss on investments, debt extinguishment charges, interest expense, net, restructuring and certain other charges, Medical Device Regulation (MDR) and other costs, strategic transaction costs, stock-based compensation, depreciation and other amortization, acquisition-related intangible asset amortization, insurance settlement loss (gain), and inventory step-up charges from the results of the Company’s operating segments.

The Company’s management, including the chief operating decision maker, evaluates the operating results of each of its reportable segments based upon Net sales and Adjusted EBITDA, which excludes the effect of Other (income) expense, net, non-operating (gain) loss on investments, debt extinguishment charges, interest expense, net, restructuring and certain other charges, Medical Device Regulation (MDR) and other costs, strategic transaction costs, stock-based compensation, depreciation and other amortization, acquisition-related intangible asset amortization, purchase of royalty interest, insurance settlement loss (gain), goodwill impairment charges, and inventory step-up charges from the results of the Company’s operating segments.

ENOVIS CORPORATION

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The Company’s segment results were as follows:

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

Three Months Ended

April 4, 2025 March 29, 2024

(In thousands)

Prevention & Recovery:

Reconstructive 230,978 147,237 735,637 457,675

$ 505,222 $ 417,524 $ 1,546,648 $ 1,252,177

Segment Adjusted EBITDA (1) :

Prevention & Recovery $ 42,776 $ 44,102 $ 111,840 $ 109,123

Net sales $ 272,584 $ 259,013

Segment cost of sales 128,764 127,677

Segment research and development 9,241 8,780

Segment operating expense 107,844 99,202

Total segment expenses 245,849 235,659

Depreciation 4,168 4,569

Adjusted EBITDA (non-GAAP) $ 30,903 $ 27,923

Reconstructive:

$ 90,203 $ 65,386 $ 263,651 $ 187,480

(1) The following is a reconciliation of Income (loss) from continuing operations before income taxes to Adjusted EBITDA:

Three Months Ended Nine Months Ended

September 27, 2024 September 29, 2023 September 27, 2024 September 29, 2023

Net sales $ 286,250 $ 257,253

Segment cost of sales 85,157 85,617

Segment research and development 19,287 14,597

Segment operating expense 138,402 124,332

Total segment expenses 242,846 224,546

Depreciation 24,867 22,604

Adjusted EBITDA (non-GAAP) $ 68,271 $ 55,311

Net Sales $ 558,834 $ 516,266

Adjusted EBITDA (non-GAAP) $ 99,174 $ 83,234

(1) The following is a reconciliation of Loss from continuing operations before income taxes to Adjusted EBITDA:

Three Months Ended

April 4, 2025 March 29, 2024

(In thousands)

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Restructuring and other costs (1)

7,786 5,341 25,284 12,083

MDR and other costs (2)

5,297 6,228 14,757 23,021

Strategic transaction costs (3)

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Amortization of acquired intangibles 41,812 40,931

Purchase of royalty interest 35,777 —

Inventory step-up 12,122 5,077

1 unchanged sentence

Other (income) expense, net (4)

( 202 ) ( 757 ) ( 9,803 ) ( 665 )

Adjusted EBITDA (non-GAAP) $ 99,174 $ 83,234

(1) Restructuring and other charges includes $ 2.7 million and $ 2.7 million, of expense classified as Cost of sales on the Company’s Condensed Consolidated Statements of Operations for the three and nine months ended September 27, 2024, respectively.

Restructuring and other charges includes $ — million and $ 0.3 million, of expense classified as Cost of sales on the Company’s Condensed Consolidated Statements of Operations for the three and nine months ended September 29, 2023, respectively.

(2) Primarily related to costs specific to compliance with medical device reporting reg ulations and other requirements of the European Union Medical Devices Regulation.

(1) Restructuring and other charges includes an immaterial expense classified as Cost of sales on the Company’s Condensed Consolidated Statements of Operations for the three months ended April 4, 2025.

(2) Primarily related to costs specific to compliance with medical device reporting regulations and other requirements of the European Union Medical Devices Regulation.

These costs are classified as Selling, general and administrative expense on our Condensed Consolidated Statements of Operations.

(3) Primarily relates to integration costs associated with the Lima Acquisition in 2024 and other strategic initiatives in 2023, including costs related to the Separation.

(4) Primarily includes the fair value gain on Contingent Acquisition Shares, partially offset by the first quarter of 2024 loss on the non-designated forward currency hedge for managing exchange rate risk related to the Euro-denominated purchase price of the Lima Acquisition.

(3) Primarily relates to integration costs associated with the Lima Acquisition.

(4) Includes the final fair value loss adjustment for the Contingent Acquisition Shares in 2025, and the fair value gain on Contingent Acquisition Shares in 2024, partially offset by a loss on the non-designated forward currency hedge for managing exchange rate risk related to the Euro-denominated purchase price of the Lima Acquisition.

ENOVIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company’s total assets and capital expenditures by segment were as follows:

April 4, 2025 December 31, 2024

(In thousands)

Total assets (1) :

Prevention & Recovery $ 1,899,441 $ 1,955,138

Reconstructive 2,975,593 2,763,639

Total $ 4,875,034 $ 4,718,777

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

Three Months Ended

April 4, 2025 March 29, 2024

(In thousands)

Capital expenditures:

Prevention & Recovery $ 8,793 $ 4,398

Reconstructive 34,469 32,530

Total capital expenditures $ 43,262 $ 36,928

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-Q

Item 1. Financial Statements