HAEMONETICS CORP 10-Q

ITEM 1. FINANCIAL STATEMENTS HAEMONETICS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited in thousands, except per share data) Three Months Ended Six Months Ended October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Net revenues $ 297,485 $ 239,897 $ 558,943 $ 468,425 Cost of goods sold 139,607 117,356 258,802 237,799 Gross profit 157,878 122,541 300,141 230,626 Operating expenses: Research and development 10,896 10,853 21,798 23,554 Selling, general and administrative 92,411 75,778 184,638 166,996 Amortization of intangible assets 8,221 11,400 16,588 23,779 Gains on divestiture ( 382 ) — ( 382 ) ( 9,603 ) Total operating expenses 111,146 98,031 222,642 204,726 Operating income 46,732 24,510 77,499 25,900 Interest and other expense, net ( 5,673 ) ( 4,588 ) ( 10,946 ) ( 8,986 ) Income before provision for income taxes 41,059 19,922 66,553 16,914 Provision for income taxes 7,862 5,066 13,479 6,512 Net income $ 33,197 $ 14,856 $ 53,074 $ 10,402 Net income per share - basic $ 0.65 $ 0.29 $ 1.04 $ 0.20 Net income per share - diluted $ 0.64 $ 0.29 $ 1.03 $ 0.20 Weighted average shares outstanding Basic 50,953 51,039 51,089 50,989 Diluted 51,558 51,458 51,620 51,358 Comprehensive income $ 25,659 $ 14,420 $ 38,773 $ 10,413 The accompanying notes are an integral part of these condensed consolidated financial statements. 3 HAEMONETICS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited in thousands, except share data) October 1, 2022 April 2, 2022 ASSETS Current assets: Cash and cash equivalents $ 241,200 $ 259,496 Accounts receivable, less allowance for credit losses of $ 2,495 at October 1, 2022 and $ 2,475 at April 2, 2022 171,532 159,376 Inventories, net 254,680 293,027 Prepaid expenses and other current assets 48,377 44,132 Total current assets 715,789 756,031 Property, plant and equipment, net 307,844 258,482 Intangible assets, less accumulated amortization of $ 395,822 at October 1, 2022 and $ 376,552 at April 2, 2022 292,595 310,261 Goodwill 464,987 467,287 Deferred tax asset 4,282 4,468 Other long-term assets 79,615 63,205 Total assets $ 1,865,112 $ 1,859,734 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Notes payable and current maturities of long-term debt $ 58,194 $ 214,148 Accounts payable 61,484 58,371 Accrued payroll and related costs 44,596 48,540 Other current liabilities 97,901 121,207 Total current liabilities 262,175 442,266 Long-term debt, net of current maturities 759,552 559,441 Deferred tax liability 35,974 28,727 Other long-term liabilities 78,402 79,876 Total stockholders’ equity Common stock, $ 0.01 par value; Authorized — 150,000,000 shares; Issued and outstanding — 50,605,499 shares at October 1, 2022 and 51,124,240 shares at April 2, 2022 506 511 Additional paid-in capital 564,394 572,476 Retained earnings 204,364 202,391 Accumulated other comprehensive loss ( 40,255 ) ( 25,954 ) Total stockholders’ equity 729,009 749,424 Total liabilities and stockholders’ equity $ 1,865,112 $ 1,859,734 The accompanying notes are an integral part of these condensed consolidated financial statements. 4 HAEMONETICS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited in thousands) Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders’ Equity Shares Par Value Balance, April 2, 2022 51,124 $ 511 $ 572,476 $ 202,391 $ ( 25,954 ) $ 749,424 Employee stock purchase plan 57 — 2,459 — — 2,459 Exercise of stock options 3 1 126 — — 127 Issuance of restricted stock, net of cancellations 131 1 ( 1 ) — — — Share-based compensation expense — — 5,299 — — 5,299 Net income — — — 19,877 — 19,877 Other comprehensive loss — — — — ( 6,763 ) ( 6,763 ) Balance, July 2, 2022 51,315 $ 513 $ 580,359 $ 222,268 $ ( 32,717 ) $ 770,423 Exercise of stock options 50 1 2,191 — — 2,192 Shares repurchased ( 786 ) ( 8 ) ( 23,891 ) ( 51,101 ) — ( 75,000 ) Issuance of restricted stock, net of cancellations 26 — — — — — Share-based compensation expense — — 5,735 — — 5,735 Net income — — — 33,197 — 33,197 Other comprehensive loss — — — ( 7,538 ) ( 7,538 ) Balance, October 1, 2022 50,605 $ 506 $ 564,394 $ 204,364 $ ( 40,255 ) $ 729,009 Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders’ Equity Shares Par Value Balance, April 3, 2021 50,869 $ 509 $ 602,727 $ 157,981 $ ( 29,547 ) $ 731,670 Employee stock purchase plan 39 — 2,210 — — 2,210 Exercise of stock options 14 — 500 — — 500 Issuance of restricted stock, net of cancellations 91 1 ( 1 ) — — — Cumulative effect of change in accounting standards — — ( 61,156 ) 1,035 — ( 60,121 ) Share-based compensation expense — — 6,828 — — 6,828 Net loss — — — ( 4,454 ) — ( 4,454 ) Other comprehensive income — — — — 447 447 Balance, July 3, 2021 51,013 $ 510 $ 551,108 $ 154,562 $ ( 29,100 ) $ 677,080 Exercise of stock options 28 1 1,069 — — 1,070 Issuance of restricted stock, net of cancellations 19 — — — — — Share-based compensation expense — — 5,979 — — 5,979 Net income — — — 14,856 — 14,856 Other comprehensive loss — — — — ( 436 ) ( 436 ) Balance, October 2, 2021 51,060 $ 511 $ 558,156 $ 169,418 $ ( 29,536 ) $ 698,549 The accompanying notes are an integral part of these condensed consolidated financial statements. 5 HAEMONETICS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited in thousands) Six Months Ended October 1, 2022 October 2, 2021 Cash Flows from Operating Activities: Net income $ 53,074 $ 10,402 Adjustments to reconcile net income to net cash provided by operating activities: Non-cash items: Depreciation and amortization 45,883 48,567 Impairment of assets 94 5,144 Share-based compensation expense 11,034 12,807 Amortization of deferred finance costs 313 1,813 (Benefit) provision for losses on inventory ( 1,529 ) 114 Gains on divestiture ( 382 ) ( 9,603 ) Contingent consideration expense ( 504 ) 9,345 Other non-cash operating activities ( 1,186 ) 7,054 Change in operating assets and liabilities: Change in accounts receivable ( 17,043 ) ( 14,574 ) Change in inventories 35,990 ( 5,475 ) Change in prepaid income taxes 2,145 2,477 Change in other assets and other liabilities ( 7,724 ) ( 842 ) Change in accounts payable and accrued expenses 8,867 ( 25,449 ) Net cash provided by operating activities 129,032 41,780 Cash Flows from Investing Activities: Capital expenditures ( 81,424 ) ( 34,731 ) Acquisition ( 2,850 ) ( 2,500 ) Proceeds from divestiture 850 — Proceeds from sale of property, plant and equipment 7,537 860 Other investments ( 13,395 ) — Net cash used in investing activities ( 89,282 ) ( 36,371 ) Cash Flows from Financing Activities: Term loan borrowings 280,000 — Term loan redemption ( 280,000 ) — Proceeds from revolving facility 50,000 — Repayment of term loan borrowings ( 6,125 ) ( 8,750 ) Debt issuance costs ( 1,118 ) — Share repurchases ( 75,000 ) — Contingent consideration payments ( 21,593 ) — Proceeds from employee stock purchase plan 2,459 2,210 Proceeds from exercise of stock options 2,319 1,569 Other ( 23 ) 22 Net cash used in financing activities ( 49,081 ) ( 4,949 ) Effect of exchange rates on cash and cash equivalents ( 8,965 ) ( 345 ) Net Change in Cash and Cash Equivalents ( 18,296 ) 115 Cash and Cash Equivalents at Beginning of Period 259,496 192,305 Cash and Cash Equivalents at End of Period $ 241,200 $ 192,420 Supplemental Disclosures of Cash Flow Information: Non-Cash Investing and Financing Activities: Transfers from inventory to fixed assets for placement of Haemonetics equipment $ 66,452 $ 10,139 The accompanying notes are an integral part of these condensed consolidated financial statements. 6 HAEMONETICS CORPORATION AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. BASIS OF PRESENTATION Basis of Presentation The accompanying unaudited condensed consolidated financial statements of Haemonetics Corporation (“Haemonetics” or the “Company”) presented herein have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of the Company’s management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. All intercompany transactions have been eliminated. Operating results for the six months ended October 1, 2022 are not necessarily indicative of the results that may be expected for the full fiscal year ending April 1, 2023 or any other interim period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes included in the Annual Report on Form 10-K for the fiscal year ended April 2, 2022. The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. There were no material recognized or unrecognized subsequent events as of or for the six months ended October 1, 2022, except those listed below. In November 2022, the Company made a € 20 million investment in Vivasure Medical LTD, bringing the Company's total investment to € 30 million. The investment will also be classified as other long-term assets on the Company’s Condensed Consolidated Balance Sheets. 2. RECENT ACCOUNTING PRONOUNCEMENTS Standards Implemented In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Codification (“ASC”) Update No. 2019-12 — Income Taxes (Topic 740). The new guidance improves consistent application of and simplifies the accounting for income taxes by removing certain exceptions to the general principals in Topic 740. The Company adopted ASC Update No. 2019-12 effective April 4, 2021. The adoption did not have a material impact on the Company’s financial position or results of operations. In August 2020, the FASB issued ASC Update No. 2020-06 — Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40). The amendments simplify the complexity associated with applying U.S. GAAP for certain financial instruments with characteristics of liabilities and equity. Update No. 2020-06 is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. The Company early adopted ASC Update No. 2020-06 effective April 4, 2021 using the modified retrospective method, which resulted in a decrease of $ 61.2 million to additional paid-in capital, a decrease to non-current deferred tax liabilities of $ 20.0 million, and an increase of $ 80.3 million to non-current convertible notes, net, on the condensed consolidated balance sheets. Additionally, retained earnings was adjusted to remove amortization expense recognized in prior periods related to the debt discount and the convertible notes no longer have a debt discount that will be amortized, net of taxes. The impact to retained earnings on the condensed consolidated balance sheets as of April 4, 2021 is an increase of $ 1.0 million. In July 2021, the FASB issued ASC Update No. 2021-05 — Leases (Topic 842). The new guidance requires a lessor to classify a lease with variable lease payments that do not depend on an index or rate as an operating lease at lease commencement if the lease would have been classified as a sales-type lease or a direct financing lease in accordance with the classification criteria of ASC 842 and the lessor would have otherwise recognized a day-one loss. The Company prospectively adopted ASC Update No. 2021-05 effective in the second quarter of fiscal year 2022. The adoption did not have a material impact on the Company’s financial position or results of operations. 3. RESTRUCTURING On an ongoing basis, the Company reviews the global economy, the healthcare industry, and the markets in which it competes to identify opportunities for efficiencies, enhance commercial capabilities, align its resources and offer its customers better solutions. In order to realize these opportunities, the Company undertakes restructuring-type activities to transform its business. 7 In July 2019, the Board of Directors of the Company approved the Operational Excellence Program (the “2020 Program”) and delegated authority to the Company’s management to determine the detail of the initiatives that will comprise the program. During fiscal 2022, the Company revised the program to improve product and service quality, reduce cost principally in its manufacturing and supply chain operations and ensure sustainability while helping to offset impacts from a previously announced customer loss, rising inflationary pressures and effects of the COVID-19 pandemic. The Company now expects to incur aggregate charges between $ 95 million and $ 105 million by the end of fiscal 2025 under the program. The majority of charges will result in cash outlays, including severance and other employee costs, and will be incurred as the specific actions required to execute these initiatives are identified and approved. During the three and six months ended October 1, 2022, the Company incurred $ 3.1 million and $ 6.6 million, respectively, of restructuring and restructuring related costs under this program. During the three and six months ended October 2, 2021, the Company incurred $ 4.6 million and $ 14.5 million, respectively, of restructuring and restructuring related costs under this program. Total cumulative charges under this program are $ 62.3 million . The following table summarizes the activity for restructuring reserves related to the 2020 Program and prior programs for the six months ended October 1, 2022, substantially all of which relates to employee severance and other employee costs: (In thousands) 2020 Program Prior Programs Total Balance at April 2, 2022 $ 2,460 $ 345 $ 2,805 Costs incurred, net of reversals 59 62 121 Payments ( 1,038 ) ( 101 ) ( 1,139 ) Balance at October 1, 2022 $ 1,481 $ 306 $ 1,787 The following presents the restructuring costs by line item within our accompanying unaudited Condensed Consolidated Statements of Income and Comprehensive Income: Three Months Ended Six Months Ended (In thousands) October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Cost of goods sold $ 29 $ 210 $ ( 177 ) $ 2,463 Research and development — 3 — 108 Selling, general and administrative expenses 136 482 298 1,544 $ 165 $ 695 $ 121 $ 4,115 As of October 1, 2022, the Company had a restr ucturing liability of $ 1.8 million , of which $ 1.5 million is paya ble within the next twelve months. In addition to the restructuring costs included in the table above, the Company also incurred costs that do not constitute restructuring under ASC 420, Exit and Disposal Cost Obligations, and which the Company instead refers to as restructuring related costs. These costs consist primarily of expenditures directly related to the restructuring actions and include program management costs associated with the implementation of outsourcing initiatives and recent accounting standards. 8 The tables below present restructuring and restructuring related costs by reportable segment: Restructuring costs Three Months Ended Six Months Ended (In thousands) October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Plasma $ — $ 411 $ ( 211 ) $ 2,699 Blood Center — — — 3 Hospital — ( 53 ) — ( 91 ) Corporate 165 337 332 1,504 Total $ 165 $ 695 $ 121 $ 4,115 Restructuring related costs Three Months Ended Six Months Ended (In thousands) October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Plasma $ 108 $ 1,403 $ 748 $ 3,141 Blood Center 16 40 18 530 Hospital 111 32 200 165 Corporate 2,794 2,343 5,585 6,617 Total $ 3,029 $ 3,818 $ 6,551 $ 10,453 Total restructuring and restructuring related costs $ 3,194 $ 4,513 $ 6,672 $ 14,568 4. INCOME TAXES The Company conducts business globally and reports its results of operations in a number of foreign jurisdictions in addition to the United States. The Company’s reported tax rate is impacted by the jurisdictional mix of earnings in any given period as the foreign jurisdictions in which it operates have tax rates that differ from the U.S. statutory tax rate. For the three and six months ended October 1, 2022, the Company reported income tax expense of $ 7.9 million and $ 13.5 million, respectively, representing effective tax rates of 19.1 % and 20.3 %, respectively. The effective tax rate for the six months ended October 1, 2022 includes a discrete tax benefit of $ 0.5 million related to tax rate changes enacted in the quarter and $ 0.3 million of discrete tax expense relating to stock compensation shortfalls. The effective tax rate for the three months ended October 1, 2022, the effective tax rate includes a discrete tax benefit of $ 0.5 million related to tax rate changes enacted in the quarter and $ 0.3 million of discrete tax benefit relating to stock compensation windfalls. For the three and six months ended October 2, 2021, the Company reported income tax expense of $ 5.1 million and $ 6.5 million, respectively, representing effective tax rates of 25.4 % and 38.5 %, respectively. The effective tax rates for the three and six months ended October 2, 2021 include discrete tax expense relating to stock compensation shortfalls of $ 0.1 million and $ 0.9 million, respectively. 9 5. EARNINGS PER SHARE The following table provides a reconciliation of the numerators and denominators of the basic and diluted earnings per share computations. Three Months Ended Six Months Ended (In thousands, except per share amounts) October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Basic EPS Net income $ 33,197 $ 14,856 $ 53,074 $ 10,402 Weighted average shares 50,953 51,039 51,089 50,989 Basic income per share $ 0.65 $ 0.29 $ 1.04 $ 0.20 Diluted EPS Net income $ 33,197 $ 14,856 $ 53,074 $ 10,402 Basic weighted average shares 50,953 51,039 51,089 50,989 Net effect of common stock equivalents 605 419 531 369 Diluted weighted average shares 51,558 51,458 51,620 51,358 Diluted income per share $ 0.64 $ 0.29 $ 1.03 $ 0.20 Basic earnings per share is calculated using the Company’s weighted-average outstanding common stock. Diluted earnings per share is calculated using its weighted-average outstanding common stock including the dilutive effect of stock awards as determined under the treasury stock method and the convertible senior notes as determined under the net share settlement method. From the time of the issuance of the convertible senior notes, the average market price of the Company's common shares has been less than the initial conversion price, and consequently no shares have been included in diluted earnings per share for the co nversion value of the convertible senior notes. For the three and six months ended October 1, 2022, weighted average shares outstanding, assuming dilution, excludes the impact of 0.7 million and 0.8 million anti-dilutive shares, respectively. For the three and six months ended October 2, 2021, weighted average shares outstanding, assuming dilution, excludes the impact of 0.9 million anti-dilutive shares. Share Repurchase Program In August 2022, the Company's Board of Directors authorized the repurchase of up to $ 300 million of Haemonetics common stock over the next three years . Under the share repurchase program, the Company is authorized to repurchase, from time to time, outstanding shares of common stock in accordance with applicable laws on the open market, including under trading plans established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, and in privately negotiated transactions. The actual timing, number and value of shares repurchased will be determined by the Company at its discretion and will depend on a number of factors, including market conditions, applicable legal requirements and compliance with the terms of loan covenants. The share repurchase program may be suspended, modified or discontinued at any time, and the Company has no obligation to repurchase any amount of its common stock under the program. Subsequent to the Company’s announcement of the share repurchase program, in August 2022, the Company entered into an accelerated share repurchase agreement (“ASR”) with Citibank N.A. (“Citibank”) to repurchase $ 75.0 million of the Company's common stock. Pursuant to the terms of the ASR, in August 2022, the Company paid Citibank $ 75.0 million in cash and received an initial delivery of 0.8 million shares of the Company's common stock based on a closing market price on the New York Stock Exchange on August 16, 2022 of $ 76.32 . This initial delivery of shares represented approximately 80 % of the notional amount of the ASR. The ASR was completed in November 2022 and approximately 0.2 million additional shares were delivered upon settlement. As of October 1, 2022, the total remaining authorization for repurchases of the Company's common stock under the share repurchase program was $ 225 million. 10 6. REVENUE The Company’s revenue recognition policy is to recognize revenues from product sales, software and services in accordance with ASC Topic 606, Revenue from Contracts with Customers . Revenue is recognized when obligations under the terms of a contract with a customer are satisfied; this occurs with the transfer of control of the Company’s goods or services. The Company considers revenue to be earned when all of the following criteria are met: it has a contract with a customer that creates enforceable rights and obligations; promised products or services are identified; the transaction price, or the consideration it expects to receive for transferring goods or providing services, is determinable and it has transferred control of the promised items to the customer. A promise in a contract to transfer a distinct good or service to the customer is identified as a performance obligation. A contract’s transaction price is allocated to each performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Some of the Company’s contracts have multiple performance obligations. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation based on the estimated standalone selling prices of the good or service in the contract. For goods or services for which observable standalone selling prices are not available, the Company uses an expected cost plus a margin approach to estimate the standalone selling price of each performance obligation. As of October 1, 2022, the Company had $ 23.0 million of its transaction price allocated to remaining performance obligations related to executed contracts with an original duration of one year or more. The Company expects to recognize approximately 74 % of this amount as revenue within the next twelve months and the remaining balance thereafter. The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and customer advances and deposits (contract liabilities) on the Condensed Consolidated Balance Sheets. The difference in timing between billing and revenue recognition primarily occurs in software licensing arrangements, resulting in contract assets and contract liabilities. As of October 1, 2022 and April 2, 2022, the Company had contract assets of $ 7.6 million and $ 5.5 million, respectively. Contract assets are classified as other current assets and other long-term assets on the Condensed Consolidated Balance Sheets. As of October 1, 2022 and April 2, 2022, the Company had contract liabilities of $ 24.4 million and $ 26.8 million, respectively. During the three and six months ended October 1, 2022, the Company recognized $ 6.8 million and $18.5 million of revenue, respectively, that was included in the above April 2, 2022 contract liability balance. 7. INVENTORIES Inventories are stated at the lower of cost or net realizable value and include the cost of material, labor and manufacturing overhead. Cost is determined with the first-in, first-out method. (In thousands) October 1, 2022 April 2, 2022 Raw materials $ 83,602 $ 88,886 Work-in-process 21,853 17,187 Finished goods 149,225 186,954 Total inventories $ 254,680 $ 293,027 8. LEASES Lessor Activity Assets on the Company’s balance sheet classified as Haemonetics equipment primarily consist of medical devices installed at customer sites but owned by Haemonetics. These devices are leased to customers under contractual arrangements that typically include an operating or sales-type lease as well as the purchase and consumption of a certain level of disposable products. Sales-type leases are not significant. Contract terms vary by customer and may include options to terminate the contract or options to extend the contract. Where devices are provided under operating lease arrangements, a substantial majority of the entire lease revenue is variable and subject to subsequent non-lease component (disposable products) sales. The allocation of revenue between the lease and non-lease components is based on stand-alone selling prices. Operating lease revenue represents approximately 3 percent of the Company’s total net sales. 11 9. NOTES PAYABLE AND LONG-TERM DEBT Convertible Senior Notes In March 2021, the Company issued $ 500.0 million aggregate principal amount of 0 % convertible senior notes due 2026 (the “2026 Notes”). The 2026 Notes are governed by the terms of the Indenture between the Company and U.S. Bank National Association, as trustee (the “Indenture”). The total net proceeds from the sale of the 2026 Notes, after deducting the initial purchasers’ discounts and debt issuance costs, were approximately $ 486.7 million. The 2026 Notes will mature on March 1, 2026, unless earlier converted, redeemed or repurchased. During the second quarter of fiscal 2023, the conditions allowing holders of the 2026 Notes to convert have not been met. The 2026 Notes were therefore not convertible as of October 1, 2022 and were classified as long-term debt on the Company’s Condensed Consolidated Balance Sheets. On April 4, 2021, the Company adopted ASC Update No. 2020-06 using the modified retrospective method, which resulted in a decrease of $ 61.2 million to additional paid-in capital, a decrease to non-current deferred tax liabilities of $ 20.0 million, and an increase of $ 80.3 million to non-current convertible notes, net, on the Condensed Consolidated Balance Sheets. Additionally, retained earnings was adjusted to remove amortization expense recognized in prior periods related to the debt discount and the convertible notes no longer have a debt discount that will be amortized, net of taxes. The impact to retained earnings on the Condensed Consolidated Balance Sheets as of April 4, 2021 is an increase of $ 1.0 million. As of October 1, 2022, the $ 500.0 million principal balance was netted down by $ 9.2 million of remaining debt issuance costs, resulting in a net convertible note payable of $ 490.8 million. Interest expense related to the 2026 Notes was $ 0.7 million and $ 1.3 million, for the three and six months ended October 1, 2022, respectively, which is entirely attributable to the amortization of the debt issuance costs. The debt issuance costs are amortized at an effective interest rate of 0.5 %. Credit Facilities On June 15, 2018, the Company entered into a credit agreement with certain lenders that provided for a $ 350.0 million term loan and a $ 350.0 million revolving loan (together with the term loa n, as amended from time to time, the “2018 Credit Facilities”) that were each scheduled to mature on June 15, 2023 with applicable interest rates during the period established using LIBOR plus 1.13 % - 1.75 %, depending on the Company’s leverage ratio. On July 26, 2022, the Company entered into an amended and restated credit agreement with certain lenders to refinance the 2018 Credit Facilities and extend their maturity date through June 2025. The amended and restated credit agreement provides for a $ 280.0 million senior unsecured term loan, the proceeds of which have been used to settle the balance of the term loan under the 2018 Credit Facilities, and a $ 420.0 million senior unsecured revolving credit facility (together, the “Revised Credit Facilities”). Loans under the Revised Credit Facilities bear interest at an annual rate equal to the Adjusted Term SOFR Rate (as specified in the amended and restated credit agreement), which is subject to a floor of 0 %, plus an applicable rate ranging from 1.125 % to 1.750 % based on the Company’s consolidated net leverage ratio (as specified in the amended and restated credit agreement) at the applicable measurement date. Adjusted Term SOFR Rate loans are also subject to a credit spread adjustment of 0.10 % per annum. The revolving credit facility carries an unused fee that ranges from 0.125 % to 0.250 % annually based on the Company’s consolidated net leverage ratio at the applicable measurement date. Under the Revised Credit Facilities, the Company is required to maintain certain leverage and interest coverage ratios specified in the amended and restated credit agreement as well as other customary non-financial affirmative and negative covenants. The Revised Credit Facilities mature on June 15, 2025. The principal amount of the term loan under the Revised Credit Facilities is repayable quarterly through the maturity date at a rate of 2.5 % for the first year and 5 % thereafter, with the unpaid balance due at maturity. The Company applied modification accounting for the credit facility refinancing. For the term loan under the Revised Credit facilities, for the three and six months ended October 1, 2022, the Company recognized interest expense of $ 0.5 million for third party fees incurred and capitalized $ 0.2 million of lender fees related to the term loan. For the three and six months ended October 1, 2022, the Company capitalized $ 1.1 million of lender fees and third-party costs incurred in the refinancing related to the revolving credit facility under the Revised Credit Facilities. At October 1, 2022, $ 278.3 million was outstanding under the term loan with an effective int erest rate of 4.2 %. The Company has scheduled principal payments of $ 8.8 million required during the 12 months following October 1, 2022. There was $ 50.0 million outstanding under the revolving credit facility at October 1, 2022. The Company also has $ 19.6 million of uncommitted operating lines of credit to fund its global operations under which there were no outstanding borrowings as of October 1, 2022. 12 The Company was in compliance with the leverage and interest coverage ratios specified in the Revised Credit Facilities as well as all other bank covenants as of October 1, 2022. 10. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS The Company manufactures, markets and sells its products globally. During the three and six months ended October 1, 2022, 28.8 % and 29.6 %, respectively, of the Company’s sales were generated outside the U.S. in local currencies. The Company also incurs certain manufacturing, marketing and selling costs in international markets in local currency. Accordingly, earnings and cash flows are exposed to market risk from changes in foreign currency exchange rates relative to the U.S. Dollar, the Company’s reporting currency. The Company has a program in place that is designed to mitigate the exposure to changes in foreign currency exchange rates. That program includes the use of derivative financial instruments to minimize, for a period of time, the impact on its financial results from changes in foreign exchange rates. The Company utilizes foreign currency forward contracts to hedge the anticipated cash flows from transactions denominated in foreign currencies, primarily the Japanese Yen and the Euro, and to a lesser extent the Swiss Franc, Chinese Yuan and the Mexican Peso. This does not eliminate the impact of the volatility of foreign exchange rates. However, because the Company generally enters into forward contracts one year out, rates are fixed for a one-year period, thereby facilitating financial planning and resource allocation. Designated Foreign Currency Hedge Contracts All of the Company’s designated foreign currency hedge contracts as of October 1, 2022 and April 2, 2022 were cash flow hedges under ASC 815, Derivatives and Hedging (“ASC 815”). The Company records the effective portion of any change in the fair value of designated foreign currency hedge contracts in other comprehensive income until the related third-party transaction occurs. Once the related third-party transaction occurs, the Company reclassifies the effective portion of any related gain or loss on the designated foreign currency hedge contracts to earnings. In the event the hedged forecasted transaction does not occur, or it becomes probable that it will not occur, the Company will reclassify the amount of any gain or loss on the related cash flow hedge to earnings at that time. The Company had designated foreign currency hedge contracts outstanding in the contract amount of $ 30.9 million as of October 1, 2022 and $ 67.3 million as of April 2, 2022. At October 1, 2022, a gain of $ 2.4 million, net of tax, will be reclassified to earnings within the next twelve months. Substantially all currency cash flow hedges outstanding as of October 1, 2022 mature within twelve months. Non-Designated Foreign Currency Contracts The Company manages its exposure to changes in foreign currency on a consolidated basis to take advantage of offsetting transactions and balances. It uses foreign currency forward contracts as a part of its strategy to manage exposure related to foreign currency denominated monetary assets and liabilities. These foreign currency forward contracts are entered into for periods consistent with currency transaction exposures, generally one month. They are not designated as cash flow or fair value hedges under ASC 815. These forward contracts are marked-to-market with changes in fair value recorded to earnings. The Company had non-designated foreign currency hedge contracts under ASC 815 outstanding in the contract amount of $ 45.2 million as of October 1, 2022 and $ 39.5 million as of April 2, 2022. 13 Interest Rate Swaps Part of the Company’s interest rate risk management strategy includes the use of interest rate swaps to mitigate its exposure to changes in variable interest rates. The Company’s objective in using interest rate swaps is to add stability to interest expense and to manage and reduce the risk inherent in interest rate fluctuations. On June 15, 2018, the Company entered into the 2018 Credit Facilities, which provided for a $ 350.0 million term loan and a $ 350.0 million revolving credit facility. Under the terms of the 2018 Credit Facilities, interest was established using LIBOR plus the applicable rate ranging from 1.13 % to 1.75 % based on the Company's leverage ratio. In August 2018, the Company entered into two interest rate swap agreements to pay an average fixed rate of 2.80 % plus the applicable rate on a total notional value of $ 241.9 million of debt, or 70 % of the notional value of the unsecured term loan. The 2018 interest rate swaps mature on June 15, 2023. As a result of the refinancing in August 2022, the 2018 interest rate swaps were amended in September 2022 to align with the Term Secured Overnight Financing Rate (“SOFR”) rate rather than LIBOR (the “Amended Swaps”). The Company concluded that the Amended Swaps were still effective such that hedge accounting was continued on these swaps. On July 26, 2022, the Company entered into an amended and restated credit agreement to refinance the 2018 Credit Facilities and extend their maturity date through June 2025. The Revised Credit Facilities include a $ 280.0 million senior unsecured term loan and a $ 420.0 million senior unsecured revolving credit facility. Loans under the Revised Credit Facilities bear interest at an annual rate equal to the 1-month USD Term SOFR plus 0.10 % and an applicable rate ranging from 1.125 % to 1.750 % based on the Company’s consolidated net leverage ratio. In September 2022, the Company entered into four additional interest rate swaps, which when combined with the Amended Swaps, result in an average blended fixed interest rate of 3.57 % plus the applicable rate on 70 % of the notional value of the unsecured term loan until mid-June 2023 and 4.12 % plus the applicable rate thereafter on 80 % of the notional until the maturity date in June 2025. The Company has concluded that each of these four additional interest rate swaps are effective and qualify for hedge accounting treatment. The Company held the following interest rate swaps as of October 1, 2022: Hedged Item Original Notional Amount Notional Amount as of October 1, 2022 Designation Date Effective Date Termination Date Fixed Interest Rate Estimated Fair Value Assets (Liabilities) (In thousands) 1-month USD Term SOFR $ 140,719 $ 85,500 9/23/2022 9/30/2022 6/15/2023 2.67 % $ 502 1-month USD Term SOFR 101,219 61,500 9/23/2022 9/30/2022 6/15/2023 2.76 % 348 1-month USD Term SOFR 23,888 23,888 9/23/2022 9/30/2022 6/15/2023 4.44 % ( 78 ) 1-month USD Term SOFR 23,888 23,888 9/23/2022 9/30/2022 6/15/2023 4.46 % ( 82 ) 1-month USD Term SOFR 109,900 — 9/23/2022 6/15/2023 6/15/2025 4.08 % ( 237 ) 1-month USD Term SOFR 109,900 — 9/23/2022 6/15/2023 6/15/2025 4.15 % ( 315 ) Total $ 509,514 $ 194,776 $ 138 For the six months ended October 1, 2022, a gain of $ 3.2 million, net of tax, was recorded in accumulated other comprehensive loss to recognize the effective portion of the fair value of the Swaps that qualify as cash flow hedges. Trade Receivables In the ordinary course of business, the Company grants trade credit to its customers on normal credit terms. In an effort to reduce its credit risk, the Company (i) establishes credit limits for all customers, (ii) performs ongoing credit evaluations of customers’ financial condition, (iii) monitors the payment history and aging of customers’ receivables, and (iv) monitors open orders against an individual customer’s outstanding receivable balance. The Company’s allowance for credit losses is maintained for trade accounts receivable based on the expected collectability, the historical collection experience, the length of time an account is outstanding, the financial position of the customer and information provided by credit rating se rvices. To date, the Company has not experienced significant customer payment defaults, or identified other significant collectability concerns. The following is a roll forward of the allowance for credit losses: 14 Three Months Ended Six Months Ended (In thousands) October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Beginning balance $ 2,495 $ 2,236 $ 2,475 $ 2,226 Credit loss 59 504 204 532 Write-offs ( 59 ) ( 39 ) ( 184 ) ( 57 ) Ending balance $ 2,495 $ 2,701 $ 2,495 $ 2,701 Fair Value of Derivative Instruments The following table presents the effect of the Company’s derivative instruments designated as cash flow hedges and those not designated as hedging instruments under ASC 815 in its unaudited Condensed Consolidated Statements of Income and Comprehensive Income for the six months ended October 1, 2022: (In thousands) Amount of Gain Recognized in Accumulated Other Comprehensive Loss Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Earnings Location in Condensed Consolidated Statements of Income and Comprehensive Income Amount of Gain Excluded from Effectiveness Testing Location in Condensed Consolidated Statements of Income and Comprehensive Income Designated foreign currency hedge contracts, net of tax $ 2,388 $ 2,923 Net revenues, COGS and SG&A $ 282 Interest and other expense, net Non-designated foreign currency hedge contracts $ — $ — $ 2,463 Interest and other expense, net Designated interest rate swaps, net of tax $ 2,190 $ ( 1,030 ) Interest and other expense, net $ — The Company did not have fair value hedges or net investment hedges outstanding as of October 1, 2022 or April 2, 2022. As of October 1, 2022, no material deferred taxes were recognized for designated foreign currency hedges. ASC 815 requires all derivative instruments to be recognized at their fair values as either assets or liabilities on the balance sheet. The Company determines the fair value of its derivative instruments using the framework prescribed by ASC 820, Fair Value Measurements and Disclosures , by considering the estimated amount it would receive or pay to sell or transfer these instruments at the reporting date and by taking into account current interest rates, currency exchange rates, current interest rate curves, interest rate volatilities, the creditworthiness of the counterparty for assets, and its creditworthiness for liabilities. In certain instances, the Company may utilize financial models to measure fair value. Generally, it uses inputs that include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; other observable inputs for the asset or liability; and inputs derived principally from, or corroborated by, observable market data by correlation or other means. As of October 1, 2022, the Company has classified its derivative assets and liabilities within Level 2 of the fair value hierarchy prescribed by ASC 815, as discussed below, because these observable inputs are available for substantially the full term of its derivative instruments. 15 The following tables present the fair value of the Company’s derivative instruments as they appear in its Condensed Consolidated Balance Sheets as of October 1, 2022 and April 2, 2022: (In thousands) Location in Condensed Consolidated Balance Sheets As of As of October 1, 2022 April 2, 2022 Derivative Assets: Designated foreign currency hedge contracts Other current assets $ 4,228 $ 3,133 Non-designated foreign currency hedge contracts Other current assets 85 99 Designated interest rate swaps Other current assets 1,114 — $ 5,427 $ 3,232 Derivative Liabilities: Designated foreign currency hedge contracts Other current liabilities $ 296 $ 56 Non-designated foreign currency hedge contracts Other current liabilities 271 25 Designated interest rate swaps Other current liabilities 160 1,813 Designated interest rate swaps Other long-term liabilities 815 — $ 1,542 $ 1,894 Other Fair Value Measurements Fair value is defined as the exit price that would be received from the sale of an asset or paid to transfer a liability, using assumptions that market participants would use in pricing an asset or liability. The fair value guidance establishes the following three-level hierarchy used for measuring fair value: • Level 1 — Inputs to the valuation methodology are quoted market prices for identical assets or liabilities. • Level 2 — Inputs to the valuation methodology are other observable inputs, including quoted market prices for similar assets or liabilities and market-corroborated inputs. • Level 3 — Inputs to the valuation methodology are unobservable inputs based on management’s best estimate of inputs market participants would use in pricing the asset or liability at the measurement date, including assumptions about risk. The Company’s money market funds carried at fair value are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. 16 Fair Value Measured on a Recurring Basis Financial assets and financial liabilities measured at fair value on a recurring basis consist of the following as of October 1, 2022 and April 2, 2022. As of October 1, 2022 (In thousands) Level 1 Level 2 Level 3 Total Assets Money market funds $ 63,268 $ — $ — $ 63,268 Designated foreign currency hedge contracts — 4,228 — 4,228 Non-designated foreign currency hedge contracts — 85 — 85 Designated interest rate swaps — 1,114 — 1,114 $ 63,268 $ 5,427 $ — $ 68,695 Liabilities Designated foreign currency hedge contracts $ — $ 296 $ — $ 296 Non-designated foreign currency hedge contracts — 271 — 271 Designated interest rate swaps — 975 — 975 Contingent consideration — — 779 779 $ — $ 1,542 $ 779 $ 2,321 As of April 2, 2022 Level 1 Level 2 Level 3 Total Assets Money market funds $ 97,425 $ — $ — $ 97,425 Designated foreign currency hedge contracts — 3,133 — 3,133 Non-designated foreign currency hedge contracts — 99 — 99 $ 97,425 $ 3,232 $ — $ 100,657 Liabilities Designated foreign currency hedge contracts $ — $ 56 $ — $ 56 Non-designated foreign currency hedge contracts — 25 — 25 Designated interest rate swaps — 1,813 — 1,813 Contingent consideration — — 33,675 33,675 $ — $ 1,894 $ 33,675 $ 35,569 Foreign currency hedge contracts - The fair value of foreign currency hedge contracts was measured using significant other observable inputs and valued by reference to over-the-counter quoted market prices for similar instruments. The Company does not believe that the fair value of these derivative instruments differs significantly from the amount that could be realized upon settlement or maturity, or that the changes in fair value will have a significant effect on its results of operations, financial condition or cash flows. Interest rate swaps - The fair values of interest rate swaps are measured using the present value of expected future cash flows using market-based observable inputs, including credit risk and interest rate yield curves. The Company does not believe that the fair values of these derivative instruments differ significantly from the amounts that could be realized upon settlement or maturity, or that the changes in fair value will have a significant effect on its results of operations, financial condition or cash flows. Contingent consideration - The fair value of contingent consideration liabilities is based on significant unobservable inputs, including management estimates and assumptions, and is measured based on the probability-weighted present value of the payments expected to be made. Accordingly, the fair value of contingent consideration has been classified as level 3 within the fair value hierarchy. The recurring level 3 fair value measurements of contingent consideration liabilities include the following significant unobservable inputs: 17 Fair Value at Valuation Unobservable (In thousands) October 1, 2022 Technique Input Range Revenue-based payments $ 779 Discounted cash flow Discount rate 8.5 % Projected year of payment 2022 - 2023 The fair value of contingent consideration associated with acquisitions was $ 0.8 million at October 1, 2022 and was included in other liabilities. A reconciliation of the change in the fair value of contingent consideration is included in the following table: (In thousands) Balance at April 2, 2022 $ 33,675 Change in fair value ( 504 ) Payments ( 32,293 ) Currency translation ( 99 ) Balance at October 1, 2022 $ 779 Other Fair Value Disclosures The Term Loan, which is carried at amortized cost, accounts receivable and accounts payable approximate fa ir value. The fair value of the 2026 Notes as of October 1, 2022 was $ 399.2 million, which was determined by using the market price on the last trading day of the reporting period. 11. COMMITMENTS AND CONTINGENCIES The Company is a party to various legal proceedings and claims arising out of the ordinary course of its business. The Company believes that, except for those matters described below, there are no other proceedings or claims pending against it the ultimate resolution of which could have a material adverse effect on its financial condition or results of operations. At each reporting period, management evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under ASC 450, Contingencies, for all matters. Legal costs are expensed as incurred. During the third quarter of fiscal 2021, the Company received a subpoena from the U.S. Attorney’s Office for the District of Massachusetts. The subpoena requested certain documents regarding the Company’s apheresis and autotransfusion devices and disposables, including documents relating to product complaints and adverse event reporting, regulatory clearances and product design changes, among other matters. The Company has fully cooperated with this inqui ry. On August 16, 2022, the U.S. Department of Justice (“DOJ”) filed a motion on behalf of the United States and 31 states reflecting their decision to not intervene in the underlying qui tam action captioned United States ex rel. Berthelot et al. v. Haemonetics Corp., 1:20-cv-11062-ADB, pending in the U.S. District Court for the District of Massachusetts, indicating that the DOJ had completed its investigative activity based on then available information. The qui tam case was unsealed by order dated August 18, 2022. In the fourth quarter of fiscal 2021, a putative class action complaint was filed against the Company in the Circuit Court of Cook County, Illinois by Mary Crumpton, on behalf of herself and similarly situated individuals. See Mary Crumpton v. Haemonetics Corporation, Case No. 1:21-cv-1402 . In her complaint, the plaintiff asserts that between June 2017 and August 2018 she donated plasma at a center operated by one of the Company’s customers, that the center required her to scan her finger print in a scanner that stored her finger print to identify her prior to plasma donation, and that the Company’s eQue donor management software sent her biometric information to a Company-owned server to be collected and stored in a manner that violated her rights under the Illinois Biometric Information Privacy Act (“BIPA”). The plaintiff seeks statutory damages, attorneys’ fees, and injunctive and equitable relief. In March 2021, the Company moved to dismiss the complaint for lack of personal jurisdiction and concurrently filed a motion to dismiss for failure to state a claim and a motion to stay. In late March 2022, the court denied the Company’s motion to dismiss for lack of personal jurisdiction but did not address the merits of the Company’s other positions. The Company believes the allegations in this lawsuit are without merit and will defend vigorously against them. The case is still in an early stage and the Company cannot reasonably estimate a range of potential loss and expense at this time. 12. SEGMENT AND ENTERPRISE-WIDE INFORMATION The Company determines its reportable segments by first identifying its operating segments, and then by assessing whether any components of these segments constitute a business for which discrete financial information is available and where segment 18 management regularly reviews the operating results of that component. The Company’s reporting structure aligns with its operating structure of three global business units and the information that is regularly reviewed by the Company’s chief operating decision maker. The Company’s reportable segments are as follows: • Plasma • Blood Center • Hospital Management measures and evaluates the operating segments based on operating income. Management excludes certain corporate expenses from segment operating income. In addition, certain amounts that management considers to be non-recurring or non-operational are excluded from segment operating income because management evaluates the operating results of the segments excluding such items. These items include integration and transaction costs, deal amortization, restructuring and restructuring related costs, impairments, accelerated device depreciation and related costs, costs related to compliance with the European Union Medical Device Regulation (“MDR”) and In Vitro Diagnostic Regulation (“IVDR”), unusual or infrequent and material litigation-related charges and gains and losses on dispositions and sale of assets. Although these amounts are excluded from segment operating income, as applicable, they are included in the reconciliations that follow. Management measures and evaluates the Company’s net revenues and operating income using internally derived standard currency exchange rates that remain constant from year to year; therefore, segment information is presented on this basis. Selected information by reportable segment is presented below: Three Months Ended Six Months Ended (In thousands) October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Net revenues Plasma $ 128,888 $ 82,004 $ 231,930 $ 153,807 Blood Center 75,652 75,259 142,225 146,995 Hospital 92,562 75,902 181,746 153,509 Net revenues by business unit 297,102 233,165 555,901 454,311 Service (1) 5,409 4,951 10,546 10,219 Effect of exchange rates ( 5,026 ) 1,781 ( 7,504 ) 3,895 Net revenues $ 297,485 $ 239,897 $ 558,943 $ 468,425 (1) Reflects revenue for service, maintenance and parts 19 Three Months Ended Six Months Ended (In thousands) October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Segment operating income Plasma $ 71,607 $ 42,213 $ 126,733 $ 77,559 Blood Center 37,328 34,600 67,705 68,482 Hospital 38,483 31,229 73,205 62,826 Segment operating income 147,418 108,042 267,643 208,867 Corporate expenses (1) ( 86,769 ) ( 68,186 ) ( 168,353 ) ( 136,917 ) Effect of exchange rates ( 51 ) 3,934 6,194 9,746 Integration and transaction costs ( 46 ) ( 625 ) 712 ( 17,358 ) Deal amortization ( 8,221 ) ( 11,400 ) ( 16,588 ) ( 23,779 ) Restructuring and restructuring related costs ( 3,194 ) ( 4,513 ) ( 6,672 ) ( 14,568 ) Impairment of assets and PCS2 related charges ( 83 ) ( 250 ) 267 ( 3,893 ) MDR and IVDR costs ( 2,506 ) ( 2,347 ) ( 5,692 ) ( 4,718 ) Litigation-related charges ( 198 ) ( 145 ) ( 394 ) ( 1,083 ) Gains on divestiture 382 — 382 9,603 Operating income $ 46,732 $ 24,510 $ 77,499 $ 25,900 (1) Reflects shared service expenses including quality and regulatory, customer and field service, research and development, manufacturing and supply chain, as well as other corporate support functions. Management reviews revenue based on the reportable segments noted above. Although these reportable segments are primarily product-based, they differ from the Company’s product line revenues for Plasma products and services and Blood Center products and services. Specifically, the Blood Center reportable segment includes plasma products utilized for collection in blood centers primarily for transfusion purposes. Additionally, product line revenues also include service revenues which are excluded from the reportable segments. Net revenues by product line are as follows: Three Months Ended Six Months Ended (In thousands) October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 Plasma products and services $ 143,161 $ 102,075 $ 261,513 $ 192,584 Blood Center products and services 61,895 59,931 114,813 117,678 Hospital products and services 92,429 77,891 182,617 158,163 Net revenues $ 297,485 $ 239,897 $ 558,943 $ 468,425 Net revenues generated in the Company’s principle operating regions on a reported basis are as follows: Three Months Ended Six Months Ended (In thousands) October 1, 2022 October 2, 2021 October 1, 2022 October 2, 2021 United States $ 211,724 $ 152,106 $ 393,720 $ 293,134 Japan 15,129 18,812 29,007 36,033 Europe 41,850 41,180 82,307 84,515 Asia 27,861 26,771 52,285 52,723 Other 921 1,028 1,624 2,020 Net revenues $ 297,485 $ 239,897 $ 558,943 $ 468,425 20 13. ACCUMULATED OTHER COMPREHENSIVE LOSS The components of Accumulated Other Comprehensive Loss are as follows: (In thousands) Foreign Currency Defined Benefit Plans Net Unrealized Gain/(Loss) on Derivatives Total Balance as of April 2, 2022 $ ( 27,919 ) $ 1,619 $ 346 $ ( 25,954 ) Other comprehensive income (loss) before reclassifications (1) ( 16,986 ) — 4,578 ( 12,408 ) Amounts reclassified from accumulated other comprehensive income (1) — — ( 1,893 ) ( 1,893 ) Net current period other comprehensive income (loss) ( 16,986 ) — 2,685 ( 14,301 ) Balance as of October 1, 2022 $ ( 44,905 ) $ 1,619 $ 3,031 $ ( 40,255 ) (1) Presented net of income taxes, the amounts of which are insignificant.