What changed in this filing

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Item 1. Financial Statements

2024-08-08 compared with 2024-02-08 · 313 added, 280 removed, 494 unchanged (55% of the section changed)

3 unchanged sentences

(Unaudited in thousands, except per share data)

Three Months Ended Nine Months Ended

2023 December 31,

2022 December 30,

2023 December 31,

Three Months Ended

Net revenues $ 336,172 $ 311,332

5 unchanged sentences

Amortization of acquired intangible assets 12,471 7,473

Impairment of intangible assets — — 10,419 —

Total operating expenses 135,168 113,606

Operating income 39,756 53,659

Interest and other expense, net ( 1,949 ) ( 1,055 ) ( 6,489 ) ( 12,001 )

Interest and other income (expense), net 6,957 ( 2,069 )

Income before provision for income taxes 46,713 51,590

11 unchanged sentences

(Unaudited in thousands, except share data)

2023 April 1,

2024 March 30,

Current assets:

Cash and cash equivalents $ 344,429 $ 178,800

Accounts receivable, less allowance for credit losses of $ 5,725 at December 30, 2023 and $ 4,932 at April 1, 2023

Accounts receivable, less allowance for credit losses of $ 5,719 at June 29, 2024 and $ 5,695 at March 30, 2024

201,485 206,562

3 unchanged sentences

Property, plant and equipment, net 302,480 311,362

Intangible assets, less accumulated amortization of $ 442,810 at December 30, 2023 and $ 417,422 at April 1, 2023

Intangible assets, less accumulated amortization of $ 469,659 at June 29, 2024 and $ 455,213 at March 30, 2024

494,935 406,117

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Authorized — 150,000,000 shares;

Issued and outstanding — 50,785,040 shares at December 30, 2023 and 50,448,519 shares at April 1, 2023

Issued and outstanding — 51,152,886 shares at June 29, 2024 and 50,787,859 shares at March 30, 2024

Additional paid-in capital 560,881 634,627

12 unchanged sentences

Shares Par Value

Balance, April 1, 2023 50,449 $ 504 $ 594,706 $ 253,168 $ ( 30,381 ) $ 817,997

Balance, March 30, 2024 50,788 $ 508 $ 634,627 $ 360,456 $ ( 35,632 ) $ 959,959

Employee stock purchase plan 47 — 3,441 — — 3,441

2 unchanged sentences

Tax withholding on employee equity awards ( 35 ) — ( 1,315 ) ( 8,444 ) — ( 9,759 )

Share-based compensation expense — — 6,989 — — 6,989

Net income — — — 41,042 — 41,042

Other comprehensive income — — — — 863 863

Balance, July 1, 2023 50,706 $ 507 $ 609,610 $ 284,017 $ ( 29,518 ) $ 864,616

Exercise of stock options 12 — 655 37 — 692

Issuance of restricted stock, net of cancellations 22 — — — — —

Tax withholding on employee equity awards — — ( 11 ) ( 64 ) — ( 75 )

Purchase of capped call related to convertible notes — — ( 88,200 ) — — ( 88,200 )

Share-based compensation expense — — 7,628 — — 7,628

1 unchanged sentence

Other comprehensive loss — — — — ( 7,035 ) ( 7,035 )

Balance, September 30, 2023 50,740 $ 507 $ 616,960 $ 308,898 $ ( 32,705 ) $ 893,660

Employee stock purchase plan 39 — 2,732 — — 2,732

Exercise of stock options 4 1 189 ( 4 ) — 186

Issuance of restricted stock, net of cancellations 3 — — — — —

Tax withholding on employee equity awards ( 1 ) — ( 4 ) ( 36 ) — ( 40 )

Share-based compensation expense — — 7,217 — — 7,217

Net income — — — 31,241 — 31,241

Other comprehensive income — — — — 8,323 8,323

Balance, December 30, 2023 50,785 $ 508 $ 627,094 $ 340,099 $ ( 24,382 ) $ 943,319

Balance, June 29, 2024 51,153 $ 512 $ 560,881 $ 386,642 $ ( 42,667 ) $ 905,368

Common Stock Additional

7 unchanged sentences

Issuance of restricted stock, net of cancellations 140 2 ( 2 ) — — —

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

Employee stock purchase plan 45 — 1,919 — — 1,919

Shares repurchased ( 211 ) ( 2 ) 13,525 ( 13,523 ) — —

Exercise of stock options 3 — 160 — — 160

Issuance of restricted stock, net of cancellations 2 — — — — —

Tax withholding on employee equity awards ( 68 ) ( 1 ) ( 812 ) ( 4,960 ) — ( 5,773 )

Share-based compensation expense — — 6,989 — — 6,989

1 unchanged sentence

Other comprehensive income — — — — 863 863

Balance, December 31, 2022 50,444 $ 504 $ 587,489 $ 223,785 $ ( 35,799 ) $ 775,979

Balance, July 1, 2023 50,706 $ 507 $ 609,610 $ 284,017 $ ( 29,518 ) $ 864,616

The accompanying notes are an integral part of these condensed consolidated financial statements.

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(Unaudited in thousands)

Nine Months Ended

2023 December 31,

Three Months Ended

Cash Flows from Operating Activities:

3 unchanged sentences

Depreciation and amortization 29,136 23,032

Amortization of fair value inventory step-up 5,239 —

Share-based compensation expense 7,628 6,989

Impairment of assets 10,419 94

Amortization of deferred financing costs 2,393 1,098

Gain on repurchase of convertible senior notes, net ( 12,600 ) —

Inventory reserve adjustment 3,602 ( 1,785 )

Gains on sales of property, plant and equipment ( 14,291 ) ( 214 )

Other non-cash operating activities ( 1,927 ) 1,726

5 unchanged sentences

Change in accounts payable and accrued expenses ( 44,105 ) ( 14,927 )

Net cash provided by operating activities 117,670 193,447

Net cash (used in) provided by operating activities ( 27,421 ) 19,086

Cash Flows from Investing Activities:

Capital expenditures ( 5,656 ) ( 7,681 )

Acquisitions ( 243,852 ) ( 2,850 )

Proceeds from divestiture — 850

Non-cash transfers from inventory to property, plant and equipment for Haemonetics equipment ( 4,211 ) ( 1,982 )

Acquisition, net of cash acquired ( 149,151 ) —

Proceeds from sale of property, plant and equipment 20,362 402

2 unchanged sentences

Cash Flows from Financing Activities:

Proceeds from issuance of convertible notes 700,000 —

Repurchase of convertible senior notes ( 185,500 ) —

Purchase of capped call related to convertible notes ( 88,200 ) —

Term loan borrowings 250,000 —

Term loan redemption ( 262,500 ) —

Proceeds from revolving facility 110,000 50,000

Payments on revolving facility ( 50,000 ) —

1 unchanged sentence

Debt issuance costs ( 23,135 ) —

Share repurchases — ( 75,000 )

Contingent consideration payments ( 849 ) ( 21,593 )

Proceeds from employee stock purchase plan 3,441 2,871

7 unchanged sentences

Cash and Cash Equivalents at End of Period $ 344,429 $ 285,719

Supplemental Disclosures of Cash Flow Information:

Non-Cash Investing and Financing Activities:

Transfers from inventory to fixed assets for placement of Haemonetics equipment $ 25,171 $ 77,946

The accompanying notes are an integral part of these condensed consolidated financial statements.

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All intercompany transactions have been eliminated.

Operating results for the nine months ended December 30, 2023 are not necessarily indicative of the results that may be expected for the full fiscal year ending March 30, 2024 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 1, 2023.

Operating results for the three months ended June 29, 2024 are not necessarily indicative of the results that may be expected for the full fiscal year ending March 29, 2025 or any other interim period.

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 nine months ended December 30, 2023.

There were no material recognized or unrecognized subsequent events as of or for the three months ended June 29, 2024.

RECENT ACCOUNTING PRONOUNCEMENTS

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ASC Update No.

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

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

The new guidance is applicable to Haemonetics beginning with the fiscal 2025 Annual Report on Form 10-K.

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ACQUISITIONS AND STRATEGIC INVESTMENTS

Strategic Investments

As part of the Company’s business development activities, it holds strategic investments in certain entities.

During fiscal 2024, the Compan y has made strategic investments totaling $ 7.6 million.

During fiscal yea r 2023, the Company made investments in Vivasure Medical LTD (“Vivasure”), totaling € 30 million.

The investments in Vivasure include both preferred stock and a special share that allows the Company to acquire Vivasure in accordance with an agreement between the parties.

The Company’s strategic investments are classified as other long-term assets on the Company’s Condensed Consolidated Balance Sheets and the Company has not recorded any adjustments to the carrying value of the strategic investments during three and nine months ended December 30, 2023 .

Acquisition of OpSens, Inc.

On October 10, 2023, the Company announced it had entered into an Arrangement Agreement with OpSens, Inc.

A cquisitions

Attune Medical

On March 5, 2024, the Company entered into a definitive agreement to acquire Advanced Cooling Therapy, Inc., d/b/a Attune Medical (“Attune Medical”), the manufacturer of the ensoETM ® proactive esophageal cooling device, pursuant to which, among other things, the Company agreed to acquire all of the issued and outstanding common shares of Attune Medical.

On April 1, 2024, the Company completed its acquisition of Attune Medical for total consideration of $ 186.2 million, which included an upfront cash payment of $ 160.7 million, or $ 149.2 million net of cash acquired, the fair value of contingent consideration of $ 25.0 million, and $ 0.5 million of estimated working capital adjustments.

The Company’s purchase price is subject to customary working capital and certain other adjustments as of the closing of the transaction and additional contingent consideration based on sales growth over the next three years, which is uncapped, and the achievement of certain other milestones.

The Company financed the acquisition through a combination of cash on hand and borrowings under its senior unsecured revolving credit facility.

Attune Medical's ensoETM technology is designed for use across a range of medical conditions involving patient cooling or warming, including treatment in electrophysiology, critical care, neurocritical care, trauma, burn surgery, spine surgery, and cancer surgery, among others.

The Company’s addition of the Esophageal Protection product line through its acquisition of Attune Medical expands the Hospital business unit’s presence in electrophysiology and complements its Vascular Closure product line within Interventional Technologies, which is included in the Hospital reportable segment.

Purchase Price Allocation

The Company accounted for the acquisition as a business combination, and in accordance with FASB ASC Topic 805, Business Combinations (Topic 805), recorded the assets acquired and liabilities assumed at their fair values as of the acquisition date.

The fair value of assets acquired and liabilities assumed have been recognized based on management’s estimates and assumptions using the information regarding facts and circumstances that existed at the closing date.

The assessment of fair value is preliminary and is based on information that was available at the time the Condensed Consolidated Financial Statements were prepared.

The most significant open items include the valuation of certain intangible assets, contingent consideration and the accounting for income taxes as the Company is awaiting additional information to complete its assessment of these matters.

Measurement period adjustments will be recorded in the period in which they are determined, as if they had been completed at the acquisition date.

The finalization of the Company’s purchase accounting assessment could result in changes in the valuation of assets acquired and liabilities assumed, which could be material.

The final determination of the fair value of certain assets and liabilities will be completed within the measurement period as required by Topic 805.

As of June 29, 2024, the valuation studies necessary to determine the fair market value of the assets acquired and liabilities assumed are preliminary, including the projection of the underlying cash flows used to determine the fair value of the identified tangible, intangible and financial assets and liabilities.

The preliminary purchase price of $ 174.7 million, net of $ 11.5 million of cash acquired consists of the amounts presented below, which represent the preliminary determination of the fair value of the identifiable assets acquired and liabilities assumed:

(In thousands) April 1, 2024

Accounts receivable $ 3,784

Inventories 26,300

Prepaid expenses and other current assets 906

Property, plant and equipment 200

Intangible assets 103,400

Goodwill 69,542

Total assets acquired $ 204,132

Accounts payable 2,260

Accrued payroll and related costs 2,129

Other liabilities 489

Deferred tax liability 24,593

Total liabilities assumed $ 29,471

Net assets acquired $ 174,661

The Company determined the identifiable intangible assets were developed technology, customer contracts and related relationships and trade names.

The fair values of intangible assets were based on valuation techniques with estimates and assumptions developed by the Company.

Developed technology was valued using the excess earnings method.

Customer contracts and related relationships were valued using the distributor method.

The trademark was valued using the relief from royalty method.

The cash flows used in the valuation of the intangible assets were based on estimates used to price the transaction.

In developing the discount rates applied to the cash flow projections, the discount rates were benchmarked with reference to the implied rate of return from the transaction model and the weighted average cost of capital and then adjusted to reflect the relative risk of the asset.

As of June 29, 2024, the valuation of the intangible assets is preliminary as the Company is still evaluating information related to the assets’ cash flow projections.

The excess of the purchase price over the tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill.

As a result of the acquisition of Attune Medical, the Company recognized goodwill of $ 69.5 million based on

expected synergies from integration into our Hospital business.

The goodwill is not deductible for tax purposes and relates entirely to the Hospital reportable segment.

Intangible assets acquired consist of the following:

(In thousands) Amount Weighted-Average Amortization Period Risk-Adjusted Discount

Rates used in Purchase Price Allocation

Developed technology $ 94,000 10 years 22.5 %

Customer contracts and related relationships 7,600 10 years 22.0 %

Trade names 1,800 10 years 22.0 %

Total $ 103,400

The Company recorded a long-term net deferred tax liability of $ 24.6 million primarily related to definite-lived intangible assets which cannot be deducted for tax purposes, partially offset by deferred tax assets primarily related to net operating losses acquired.

Acquisition-Related Costs

The Company incurred $ 9.8 million of acquisition-related costs for the three months ended June 29, 2024 in connection with the acquisition.

These costs related to legal and other professional fees, which were recognized in selling, general and administrative on the Condensed Consolidated Statements of Income.

The Company’s condensed consolidated financial statements include the results of Attune Medical from the date the acquisition was completed.

Pro forma financial information has not been presented as the acquisition is not material to the Company’s overall financial results.

On October 10, 2023, the Company entered into an Arrangement Agreement with OpSens Inc.

(“OpSens”), a medical device cardiology-focused company delivering solutions based on its proprietary optical technology, pursuant to which, among other things, the Company agreed to acquire all of the issued and outstanding common shares of OpSens.

On December 12, 2023, the Company completed its acquisition of OpSens for total consideration of approximately $ 254.5 million, or $ 243.9 million, net of cash acquired.

The Company financed the acquisition through a combination of cash on hand and borrowings under its revolving credit facility.

The Company financed the acquisition through a combination of cash on hand and borrowings under its senior unsecured revolving credit facility.

OpSens offers commercially and clinically validated optical technology for use primarily in interventional cardiology.

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OpSens also manufactures a range of fiber optic sensor solutions used in medical devices and other critical industrial applications.

The addition of OpSens expands the Hospital business unit portfolio in the interventional cardiology market and will be included in the Hospital reportable segment.

The addition of OpSens expands the Hospital business unit portfolio in the interventional cardiology market and is included in the Hospital reportable segment.

Purchase Price Allocation

1 unchanged sentence

The assessment of fair value is preliminary and is based on information that was available at the time the consolidated financial statements were prepared.

The most significant open items include the valuation of certain intangible assets and the accounting for income taxes as the Company is awaiting additional information to complete its assessment of these matters.

Measurement period adjustments will be recorded in the period in which they are determined, as if they had been completed at the acquisition date.

The finalization of the Company’s purchase accounting assessment could result in changes in the valuation of assets acquired and liabilities assumed, which could be material.

The final determination of the fair value of certain assets and liabilities will be completed within the measurement period as required by Topic 805.

As of December 30, 2023, the valuation studies necessary to determine the fair market value of the assets acquired and liabilities assumed are preliminary, including the projection of the underlying cash flows used to determine the fair value of the identified tangible, intangible and financial assets and liabilities.

The purchase price of $ 243.9 million, net of $ 10.6 million of cash acquired consists of the amounts presented below, which represent the preliminary determination of the fair value of the identifiable assets acquired and liabilities assumed:

The purchase price of $ 243.9 million, net of $ 10.6 million of cash acquired consists of the amounts presented below, which represe nt the final d etermination of the fair value of the identifiable assets acquired and liabilities assumed:

(In thousands) December 12, 2023

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As of December 30, 2023, the valuation of the intangible assets is preliminary as the Company is still gathering information related to the assets’ cash flow projections.

The excess of the purchase price over the tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill.

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Total $ 172,000

The Company recorded a long-term net deferred tax liability of $ 30.3 million primarily related to definite-lived intangible assets which cannot be deducted for tax purposes, partially offset by deferred tax assets primarily related to net operating losses acquired.

The Company recorded a net long-term deferred tax liability of $ 14.8 million, primarily as a result of fair value adjustments recorded associated with intangible assets and inventory in which there is no tax basis.

Acquisition-Related Costs

The Company incurred $ 6.6 million of acquisition-related costs for the nine months ended December 30, 2023 in connection with the acquisition.

The Company incurred $ 6.6 million of acquisition-related costs for fiscal 2024 in connection with the OpSens acquisition.

These costs related to legal and other professional fees, which were recognized in selling, general and administrative on the Condensed Consolidated Statements of Income.

1 unchanged sentence

Pro forma financial information has not been presented as the acquisition is not material to the Company’s overall financial results.

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 December 30, 2023, the Company had $ 23.5 million of transaction price allocated to remaining performance obligations related to executed contracts with an original duration of one year or more.

Strategic Investments

As part of the Company’s business development activities, it holds strategic investments in certain entities.

During fiscal 2024, the Compan y made an additional investment in Vivasure Medical LTD (“Vivasure”) of € 5.0 million , resulting in total investment of € 35 million.

The investments include both preferred stock and a special share that allows the Company to acquire Vivasure in accordance with an agreement between the parties.

In addition, the Compan y made other certain strategic investments totaling $ 7.6 million during fiscal 2024.

The Company’s strategic investments are classified as other long-term assets on the Company’s Condensed Consolidated Balance Sheets and the Company has not recorded any adjustments to the carrying value of our strategic investments during three months ended June 29, 2024 and July 1, 2023.

As of June 29, 2024, the Company had $ 28.9 million of 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 77 % of this amount as revenue within the next twelve months and the remaining balance thereafter.

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The difference in timing between billing and revenue recognition primarily occurs in software licensing arrangements, resulting in contract assets and contract liabilities.

As of December 30, 2023 and April 1, 2023, the Company had contract liabilities of $ 31.1 million and $ 30.2 million, respectively.

During the three and nine months ended December 30, 2023, the Company recognized $ 4.9 million and $ 25.4 million of revenue, respectively, that was included in the above April 1, 2023 contract liability balance.

As of June 29, 2024 and March 30, 2024, the Company had contract liabilities of $ 33.6 million and $ 31.2 million, respectively.

During the three months ended June 29, 2024, the Company recognized $ 13.3 million of revenue that was included in the above March 30, 2024 contract liability balance.

Contract liabilities are classified as other current liabilities on the Condensed Consolidated Balance Sheet.

As of December 30, 2023 and April 1, 2023, the Company’s contract assets were immaterial.

As of June 29, 2024 and March 30, 2024, the Company’s contract assets were immaterial.

RESTRUCTURING

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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 nine months ended December 30, 2023, the Company incurred $ 2.6 million and $ 6.8 million, respectively, of restructuring and restructuring related costs under this program.

During the three and nine months ended December 31, 2022, the Company incurred $ 4.1 million and $ 10.7 million, respectively, of restructuring and restructuring related costs under this program.

During the three months ended June 29, 2024 and July 1, 2023 the Company incurred $ 2.4 million and $ 2.2 million of restructuring and restructuring related costs under this program, respectively.

Total cumulative charges under this program are $ 79.4 million.

Portfolio Rationalization Initiatives

In November 2023, the Company announced its plans to end of life the ClotPro analyzer system within the Hospital business unit and whole blood inline collection products within the Blood Center business unit, including the associated manufacturing operations and closure of certain other facilities.

The following table summarizes the activ ity for restructuring reserves related to portfolio rationalization initiatives, the 2020 Program and prior programs for the nine months ended December 30, 2023, substantially all of which relates to employee severance and other employee costs:

(In thousands) Portfolio Rationalization 2020 Program Prior Programs Total

Balance at April 1, 2023

In November 2023, the Company announced its plans to end of life the ClotPro analyzer system within the Hospital business unit and certain products within the Blood Center business unit, primarily in Whole Blood, including the associated manufacturing operations and closure of certain other facilities.

In the three months ended June 29, 2024, the Company incurred $ 4.8 million of restructuring and restructuring related costs related to portfolio rationalization initiatives.

The following table summarizes the activ ity for restructuring reserves related to portfolio rationalization initiatives and the 2020 Pr ogram for the three months ended June 29, 2024, which relates to employee severance, other employee costs and inventory reserves:

(In thousands) Portfolio Rationalization 2020 Program Total

Balance at March 30, 2024

$ 11,309 $ 485 $ 11,794

1 unchanged sentence

Payments ( 2,769 ) ( 389 ) ( 3,158 )

Balance at December 30, 2023

Balance at June 29, 2024

$ 13,071 $ 187 $ 13,258

The following presents the restructuring costs by line item within our accompanying unaudited Condensed Consolidated Statements of Income and Comprehensive Income:

Three Months Ended Nine Months Ended

(In thousands) December 30,

2023 December 31,

2022 December 30,

2023 December 31,

Three Months Ended

(In thousands) June 29,

Cost of goods sold $ 4,366 $ 206

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Total $ 4,622 $ ( 11 )

As of December 30, 2023, the Company had a restr ucturing liability of $ 9.0 million , of which approximately $ 8.7 million is paya ble within the next twelve months.

As of June 29, 2024, the Company had a restr ucturing liability of $ 13.3 million , all of which is paya ble within the next twelve months.

In addition to the restructuring expenses included in the table above, the Company also incurred costs that do not constitute restructuring costs under ASC 420, Exit and Disposal Cost Obligations, and which the Company instead refers to as restructuring related costs.

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The tables below present restructuring and restructuring related costs by reportable segment:

Restructuring costs Three Months Ended Nine Months Ended

(In thousands) December 30, 2023 December 31, 2022 December 30, 2023 December 31, 2022

Restructuring costs Three Months Ended

(In thousands) June 29, 2024 July 1, 2023

Plasma $ 63 $ ( 256 )

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Total $ 4,622 $ ( 11 )

Restructuring related costs Three Months Ended Nine Months Ended

(In thousands) December 30, 2023 December 31, 2022 December 30, 2023 December 31, 2022

Restructuring related costs Three Months Ended

(In thousands) June 29, 2024 July 1, 2023

Plasma $ 175 $ 169

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statutory tax rate.

The Company’s effective tax rate is adversely impacted by non-deductible expenses including executive compensation and transaction costs.

For the three and nine months ended December 30, 2023, the Company reported income tax expense of $ 12.8 million and $ 31.3 million, respectively, representing effective tax rates of 29.0 % and 24.3 %, respectively.

The effective tax rate for the nine months ended December 30, 2023 includes $ 1.1 million of discrete tax benefit, of which $ 2.6 million relates to stock compensation windfalls, partially offset by other discrete items.

For the three and nine months ended December 31, 2022, the Company reported income tax expense of $ 9.3 million and $ 22.8 million, respectively, representing effective tax rates of 22.0 % and 20.9 %, respectively.

The effective tax rate for the three months ended December 31, 2022 includes $ 0.1 million of discrete tax expense relating to stock compensation shortfalls.

The effective tax rate for the nine months ended December 31, 2022 includes a discrete tax benefit of $ 0.5 million related to tax rate changes enacted in the period and $ 0.4 million of discrete tax expense relating to stock compensation shortfalls.

The increase in the reported tax rates for the three and nine months ended December 30, 2023, compared to the same periods in fiscal 2023, relates primarily to unfavorable changes in the jurisdictional mix of earnings, research tax credits generated and non-deductible acquisition-related expenses, partially offset by discrete tax benefits from stock compensation windfall deductions.

Company’s effective tax rate is adversely impacted by non-deductible expenses including executive compensation and transaction costs.

For the three months ended June 29, 2024, the Company reported income tax expense of $ 8.3 million, representing an effective tax rate of 17.9 %.

The effective tax rate for the three months ended June 29, 2024 includes $ 3.6 million of discrete tax benefit, primarily related to stock compensation windfalls.

The discrete benefit also includes other items such as provision to return differences.

For the three months ended July 1, 2023, the Company reported income tax expense of $ 10.5 million, representing an effective tax rate of 20.4 %.

The effective tax rate for the three months ended July 1, 2023 includes $ 1.2 million of discrete tax benefit primarily related to stock compensation windfalls.

The decrease in the reported tax rates for the three months ended June 29, 2024, compared to the same period in fiscal 2024, relates primarily to increased discrete tax benefits year-over-year, partially offset by unfavorable impact of jurisdictional mix of earnings and non-deductible acquisition-related expenses.

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 Nine Months Ended

(In thousands, except per share amounts) December 30,

2023 December 31,

2022 December 30,

2023 December 31,

Three Months Ended

(In thousands, except per share amounts) June 29,

Net income $ 38,373 $ 41,042

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Basic earnings per share is calculated using the Company’s weighted-average outstanding common shares.

Diluted earnings per share is calculated using its weighted-average outstanding common shares 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 nine months ended December 30, 2023 , weighted average shares outstanding, assuming dilution, excludes the impact of 0.6 million anti-dilutive shares for both periods.

For the three and nine months ended December 31, 2022 , weighted average shares outstanding, assuming dilution, excludes the impact and 0.4 million and 0.7 million anti-dilutive shares, respectively.

Diluted earnings per share is calculated using its weighted-average outstanding common shares including the dilutive effect of stock awards as determined under the treasury stock method and the outstanding 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 applicable initial conversion prices, and consequently no shares have been included in diluted earnings per share for the co nversion values of both convertible senior notes.

For the three months ended June 29, 2024 and July 1, 2023, weighted average shares outstanding, assuming dilution, excludes the impact of 0.7 million and $ 0.6 million anti-dilutive shares, respectively.

Share Repurchase Program

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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.

In fiscal 2023, the Company completed a $ 75.0 million repurchase of its common stock pursuant to an accelerated share repurchase agreement entered into with Citibank N.A.

in August 2022.

As of December 30, 2023 , the total remaining authorization for repurchases of the Company's common stock under the share repurchase program was $ 225.0 million.

As of June 29, 2024 , the total remaining authorization for repurchases of the Company's common stock under the share repurchase program was $ 225.0 million.

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) December 30,

2023 April 1,

(In thousands) June 29,

2024 March 30,

Raw materials $ 126,814 $ 134,150

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Total inventories $ 373,787 $ 317,202

In August 2023, the Company issued a voluntary recall of certain products within the Whole Blood portion of our Blood Center business unit sold to customers in the U.S.

and certain foreign jurisdictions.

As of December 30, 2023, the Company has recorded charges of $ 4.3 million related to inventory.

PROPERTY, PLANT AND EQUIPMENT

(In thousands) December 30,

2023 April 1,

(In thousands) June 29,

2024 March 30,

Land $ 3,911 $ 4,130

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Property, plant and equipment, net $ 302,480 $ 311,362

During the three and nine months ended December 30, 2023, depreciation expense was $ 14.2 million and $ 41.1 million, respectively.

During the three and nine months ended December 31, 2022, depreciation expense was $ 13.1 million and $ 37.7 million, respectively.

Beginning in the second quarter of fiscal 2024, $ 4.3 million of the Company’s property, plant and equipment met held for sale accounting criteria and was reclassed to Prepaid expenses and other current assets in the Condensed Consolidated Balance Sheets.

Depreciation expense was $ 14.6 million and $ 13.3 million for the three months ended June 29, 2024 and July 1, 2023, respectively.

In the first quarter of fiscal 2025, the Company received $ 19.9 million of cash upon the sale of a manufacturing facility and related assets that previously met held for sale criteria, which resulted in a gain of $ 14.1 million that was recorded in Selling, general and administrative expenses on the Condensed Consolidated Statements of Income.

Lessor Activity

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(In thousands) Plasma Blood Center Hospital Total

Carrying amount as of April 1, 2023

Carrying amount as of March 30, 2024

$ 29,043 $ 33,484 $ 502,555 $ 565,082

Purchase accounting adjustments — — ( 19,962 ) ( 19,962 )

Acquisitions — — 69,542 69,542

Currency translation — ( 239 ) ( 1,076 ) ( 1,315 )

Carrying amount as of December 30, 2023

Carrying amount as of June 29, 2024

$ 29,043 $ 33,245 $ 551,059 $ 613,347

The gross carrying amount of intangible assets and the related accumulated amortization as of December 30, 2023 and April 1, 2023 is as follows:

The decrease in goodwill of $ 20.0 million for purchase accounting adjustments was primarily related to the Company obtaining additional facts and information to finalize the pre-acquisition tax returns and associated analyses for OpSens.

This resulted in the Company revising its estimate of the net deferred tax liability recorded as of the acquisition date.

Refer to Note 3, Acquisitions and Strategic Investments, for additional information regarding the acquisitions of OpSens and Attune Medical.

The gross carrying amount of intangible assets and the related accumulated amortization as of June 29, 2024 and March 30, 2024 is as follows:

(In thousands) Gross Carrying

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Amortization Net

As of December 30, 2023

Patents $ 18,504 $ 11,562 $ 6,942

Capitalized software 84,443 67,169 17,274

Other developed technology 474,406 169,844 304,562

As of June 29, 2024

Developed technology $ 570,816 $ 189,019 $ 381,797

Customer contracts and related relationships 262,204 191,487 70,717

Capitalized software 84,837 71,395 13,442

Patents and other 24,504 12,075 12,429

Trade names 16,071 5,683 10,388

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In-process software development $ 6,162

In-process research and development 13,667

In-process patents 3,801

Total $ 6,162

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Amortization Net

As of April 1, 2023

Patents $ 18,504 $ 10,831 $ 7,673

Capitalized software 78,962 60,776 18,186

Other developed technology 362,506 153,099 209,407

As of March 30, 2024

Developed technology $ 464,291 $ 178,413 $ 285,878

Customer contracts and related relationships 255,144 190,033 65,111

Capitalized software 84,837 69,491 15,346

Patents and other 24,504 11,820 12,684

Trade names 14,320 5,456 8,864

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Non-amortizable:

In-process software development $ 3,841

In-process research and development $ 13,667

In-process patents 2,965

In-process software development 4,567

Total $ 18,234

During the third quarter of fiscal 2024, the Company acquired OpSens and recorded $ 121.6 million of developed technology, $ 53.9 million of customer contracts and related relationships and $ 5.0 million of trade names based on our preliminary purchase accounting valuation.

During the first quarter of fiscal 2025, the Company acquired Attune Medical and recorded $ 94.0 million of developed technology, $ 7.6 million of customer contracts and related relationships and $ 1.8 million of trade name intangibles based on our preliminary purchase accounting valuation.

Refer to Note 3, Acquisitions and Strategic Investments, for additional information regarding the acquisition.

In the first quarter of fiscal 2025, the Company announced the commercialization of MVP XL and moved the related in-process research and development intangible asset to developed technologies, and commenced amortization.

Intangible assets include the value assigned to license rights and other developed technology, patents, customer contracts and relationship s and trade names.

The estimated useful lives for all of these intangible assets are approximately 5 to 15 years.

In the second quarter of fiscal 2024, the Company recorded an intangible asset impairment charge of $ 10.4 million related to the intangibles acquired as part of the enicor GmbH acquisition completed in fiscal 2021 within the Hospital business unit.

During the three and nine months ended December 30, 2023, amortization expense was $ 9.3 million and $ 28.5 million, respectively.

During the three and nine months ended December 31, 2022, amortization expense was $ 10.4 million and $ 31.7 million, respectively.

Amortization expense was $ 14.5 million and $ 9.7 million for the three months ended June 29, 2024 and July 1, 2023, respectively.

Future annual amortization expense on intangible assets for the next five years is estimated to be as follows:

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NOTES PAYABLE AND LONG-TERM DEBT

Notes payable and long-term debt consisted of the following:

(In thousands) June 29, 2024 March 30, 2024

Convertible notes $ 980,447 $ 494,813

Term loan, net of financing fees 242,182 261,971

Revolving credit facility — 50,000

Other borrowings 957 1,009

Less current portion ( 5,109 ) ( 10,229 )

Long-term debt $ 1,218,477 $ 797,564

Convertible Senior Notes

The Company has $ 500.0 million aggregate principal amount of 0 % convertible senior notes due 2026 (the “2026 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 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 third quarter of fiscal 2024, the conditions allowing holders of the 2026 Notes to convert have not been met.

The 2026 Notes were therefore not convertible as of December 30, 2023 and were classified as long-term debt on the Company’s Condensed Consolidated Balance Sheets.

As of December 30, 2023, the $ 500.0 million principal balance was netted down by the $ 5.9 million of remaining debt issuance costs, resulting in a net convertible note payable of $ 494.1 million.

Interest expense related to the 2026 Notes was $ 0.7 million and $ 2.0 million for the three and nine months ended December 30, 2023, 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 %.

In the first quarter of fiscal 2025, the Company repurchased $ 200.0 million of the aggregate principal amount for $ 185.5 million, resulting in a gain of $ 14.5 million related to the discount on repurchase.

As the repurchase of the 2026 Notes met the criteria for extinguishment accounting, $ 1.9 million of unamortized debt issuance costs were allocated to the repurchase, resulting in a net gain of $ 12.6 million, which was recorded in Interest and other income (expense), net on the Condensed Consolidated Statements of Income.

During the first quarter of fiscal 2025, the conditions allowing holders of the 2026 Notes to convert have not been met.

The 2026 Notes were therefore not convertible as of June 29, 2024 and were classified as long-term debt on the Company’s Condensed Consolidated Balance Sheets.

As of June 29, 2024, the $ 300.0 million principal balance was netted down by $ 2.6 million of remaining debt issuance costs, resulting in a net convertible note payable of $ 297.4 million.

Interest expense related to the 2026 Notes was $ 0.7 million for the three months ended June 29, 2024, which is entirely attributable to the amortization of the debt issuance costs.

The remaining debt issuance costs are amortized at an effective interest rate of 0.5 %.

On May 28, 2024, the Company issued $ 700.0 million aggregate principal amount of 2.5 % convertible senior notes due 2029 (the “2029 Notes”).

The 2029 Notes are governed by the terms of the Indenture between the Company and U.S.

Bank National Association, as trustee.

The total net proceeds from the sale of the 2029 Notes, after deducting the initial purchasers’ discounts and debt issuance costs, were $ 682.8 million, with a portion of funds used to repay the entirety of the balance on the revolving credit facility under the Company’s second amended and restated credit agreement, to repurchase a portion of the Company’s

2026 Notes and to complete capped call transactions in connection with the issuance of the 2029 Notes, as described further below.

The Company intends to use the remainder of the proceeds for working capital and other general purposes, which may include additional repurchases of the 2026 Notes from time to time following the offering, or the repayment at maturity of the 2026 Notes.

The 2029 Notes will mature on June 1, 2029, unless earlier converted, redeemed or repurchased.

Holders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding December 1, 2028 only under the following circumstances:

• During any calendar quarter (and only during such calendar quarter) beginning after September 30, 2024, if, the last reported sale price per share of the Company’s common stock exceeds 130 % of the applicable conversion price on each applicable trading day for at least 20 trading days (whether or not consecutive) in the period of the 30 consecutive trading day period ending on, and including, the last trading day of the immediately preceding calendar quarter;

• During the five business day period after any five consecutive trading day period in which, for each day of that period, the trading price per $1,000 principal amount of the 2029 Notes for such trading day was less than 98 % of the product of the last reported sale price of the Company’s common stock and the applicable conversion rate on such trading day;

• The Company issues to common stockholders any rights, options, or warrants, entitling them, for a period of not more than 60 days, to purchase shares of common stock at a price per share less than the average closing sale price of 10 consecutive trading days, or the Company’s election to make a distribution to common stockholders exceeding 10 % of the previous day’s closing sale price;

• Upon the occurrence of specified corporate events, as set forth in the indenture governing the 2029 Notes;

• Prior to the related redemption date if the Company calls the 2029 Notes for redemption.

On or after December 1, 2028, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or a portion of their 2029 Notes, in multiples of $1,000 principal amount, at any time, regardless of the foregoing circumstances.

The conversion rate for the 2029 Notes is 8.5385 shares of common stock per $1,000 principal amount of notes (which is equal to an initial conversion price of approximately $ 117.12 per share of the Company’s common stock), subject to adjustment as set forth in the Indenture.

Upon conversion, the Company will pay cash up to the aggregate principal amount of the notes to be converted and pay or deliver, as the case may be, cash, common stock or a combination of cash and common stock, at the Company’s election, in respect of the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the notes being converted.

If a make-whole adjustment event, as described in the Indenture, occurs and a holder elects to convert its 2029 Notes in connection with such make-whole adjustment event, such holder may be entitled to an increase in the conversion rate as described in the Indenture.

During the first quarter of fiscal 2025, the conditions allowing holders of the 2029 Notes to convert have not been met.

The 2029 Notes were therefore not convertible as of June 29, 2024 and were classified as long-term debt on the Company’s consolidated balance sheets.

The 2029 Notes will be redeemable, in whole or in part, at the Company’s option at any time, and from time to time, on or after June 5, 2027 and on or before the 50th scheduled trading day immediately before the maturity date, if the last reported sale price per share of the Company’s common stock exceeds 130 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date on which the Company provides notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately before the date the Company sends the related redemption notice at a redemption price equal to 100 % of the principal amount of the 2029 Notes to be redeemed, plus accrued and unpaid interest to, but excluding the redemption date.

Upon the occurrence of certain fundamental changes involving the Company, holders of the 2029 Notes may require the Company to repurchase for cash all or part of their 2029 Notes at a repurchase price equal to 100 % of the principal amount of the 2029 Notes to be repurchased, plus

accrued and unpaid interest.

As a result of the issuance of the 2029 Notes, the Company recorded debt issuance costs of $ 17.2 million, which will be amortized to interest expense over the contractual term of the 2029 Notes at an effective interest rate of 3.0 %.

As of June 29, 2024, the $ 700.0 million principal balance was netted down by $ 17.0 million of remaining debt issuance costs, resulting in a net convertible note payable of $ 683.0 million.

Interest expense related to the 2029 Notes was $ 1.4 million for the three months ended June 29, 2024, which includes nominal interest expense and the amortization of the debt issuance costs.

In connection with the issuance of the 2029 Notes, the Company entered into capped call transactions with certain counterparties (“Capped Calls”).

The Capped Calls each have an initial strike price of approximately $ 117.12 per share, subject to certain adjustments, which corresponds to the initial conversion price of the 2029 Notes.

The Capped Calls have initial cap prices of $ 180.18 per share, subject to certain adjustments.

The Capped Calls are expected to partially offset the potential dilution to the Company’s common stock upon any conversion of the 2029 Notes, with such offset subject to a cap based on the cap price.

The Capped Calls cover, subject to anti-dilution adjustments, approximately 5.98 million shares of the Company’s common stock.

For accounting purposes, the Capped Calls are separate transactions, and not part of the 2029 Notes.

As these transactions meet certain accounting criteria, the Capped Calls are recorded in stockholders' equity and are not accounted for as derivatives.

The cost of $ 88.2 million incurred to purchase the Capped Calls was recorded as a reduction to additional paid-in capital and will not be remeasured.

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 credit facility (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.

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.

On July 26, 2022, the Company entered into an amended and restated credit agreement to refinance its credit facilities initially entered into in 2018 and extend their maturity date through June 2025.

The amended and restated credit agreement provided for a $ 280.0 million senior unsecured term loan and a $ 420.0 million senior unsecured revolving credit facility (together, the “2022 Revised Credit Facilities”) with applicable interest rates during the period established using an annual rate equal to the Adjusted Term SOFR Rate plus an applicable rate ranging from 1.125 % to 1.750 % based on the Company’s consolidated net leverage ratio, as specified in the agreement.

On April 30, 2024, the Company entered into a second amended and restated credit agreement with certain lenders to refinance the 2022 Revised Credit Facilities and extend their maturity date through April 2029.

The second amended and restated credit agreement provides for a $ 250.0 million senior unsecured term loan, the proceeds of which, along with $ 12.5 million of cash on hand, were used to retire the balance of the term loan under the 2022 Revised Credit Facilities, and a $ 750.0 million senior unsecured revolving credit facility (together, the “2024 Revised Credit Facilities”).

Loans under the 2024 Revised Credit Facilities will initially bear interest at an annual rate equal to the Adjusted Term SOFR Rate (as specified in the second amended and restated credit agreement), which is subject to a floor of 0.0 %, plus an applicable rate ranging from 1.125 % to 1.750 % based on the Company’s consolidated net leverage ratio (as specified in the second amended and restated credit agreement) at the applicable measurement date.

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 fiscal 2023, 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 fiscal 2023, 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 December 30, 2023, $ 266.0 million was outstanding under the term loan with an effective interest rate of 6.8 %.

The Company has scheduled principal payments of $ 14.0 million required during the 12 months following December 30, 2023.

During the third quarter of fiscal 2024 in connection with the acquisition of OpSens, the Company borrowed $ 110.0 million under the revolving credit facility, with an effective interest rate of 6.7 % , which remains outstanding as of December 30, 2023.

The Company also had $ 20.1 million of uncommitted operating lines of credit to fund its global operations under which there were no outstanding borrowings as of December 30, 2023.

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 December 30, 2023.

The 2024 Revised Credit Facilities mature on April 30, 2029.

The principal amount of the term loan under the 2024 Revised Credit Facilities amortizes quarterly through the maturity date at a rate of 2.5 % for the first three years following the closing date, 5.0 % for the fourth year following the closing date and 7.5 % for the fifth year following the closing date, with the unpaid balance due at maturity.

Under the 2024 Revised Credit Facilities, the Company is required to maintain a consolidated leverage ratio not to exceed 4.0 :1.0 or, on up to two occasions during the term of the facility, 4.5 :1.0 for the four consecutive fiscal quarters ended immediately following acquisitions meeting certain criteria specified in the agreement.

The Company applied modification accounting for the credit facility refinancing, which resulted in the capitalization of an additional $ 5.9 million in lender fees and third-party costs.

During the three months ended June 29, 2024, the Company recognized $ 7.1 million of interest expense and amortization of debt issuance costs related to its credit facilities.

At June 29, 2024, $ 248.4 million was outstanding under the term loan with an effective interest rate of 6.8 %, which was netted down by the $ 6.2 million of remaining debt discount, resulting in a net note payable of $ 242.2 million.

The Company has scheduled principal payments of $ 6.3 million required during the 12 months following June 29, 2024.

There were no outstanding borrowings under the revolving credit facilities at June 29, 2024, as the Company paid all outstanding borrowings during the first quarter of fiscal 2025.

The Company also had $ 17.6 million of uncommitted operating lines of credit to fund its global operations under which there were no outstanding borrowings as of June 29, 2024.

The Company was in compliance with the leverage and interest coverage ratios specified in the 2024 Revised Credit Facilities as well as all other bank covenants as of June 29, 2024.

The future aggregate amount of debt maturities are as follows:

(In thousands)

Remainder of Fiscal 2025 $ 3,235

Fiscal 2026 $ 307,916

Fiscal 2027 $ 6,311

Fiscal 2028 $ 12,564

Fiscal 2029 $ 18,818

Thereafter $ 900,550

FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The Company manufactures, markets and sells its products globally.

During the three and nine months ended December 30, 2023, 25.4 % and 25.0 %, respectively, of the Company’s sales were generated outside the U.S.

During the three months ended June 29, 2024, 26.0 % of the Company’s sales were generated outside the U.S.

in local currencies.

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Designated Foreign Currency Hedge Contracts

All of the Company’s designated foreign currency hedge contracts as of December 30, 2023 and April 1, 2023 were cash flow hedges under ASC 815, Derivatives and Hedging (“ASC 815”).

All of the Company’s designated foreign currency hedge contracts as of June 29, 2024 and March 30, 2024 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.

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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 $ 20.5 million as of December 30, 2023 and $ 51.8 million as of April 1, 2023.

At December 30, 2023, a gain of $ 2.0 million, net of tax, will be reclassified to earnings within the next twelve months.

All currency cash flow hedges outstanding as of December 30, 2023 mature within twelve months.

The Company had designated foreign currency hedge contracts outstanding in the contract amount of $ 49.0 million as of June 29, 2024 and $ 74.0 million as of March 30, 2024.

At June 29, 2024, a gain of $ 0.3 million, net of tax, will be reclassified to earnings within the next twelve months.

All currency cash flow hedges outstanding as of June 29, 2024 mature within twelve months.

Non-Designated Foreign Currency Contracts

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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 $ 38.1 million as of December 30, 2023 and $ 44.7 million as of April 1, 2023.

The Company had non-designated foreign currency hedge contracts under ASC 815 outstanding in the contract amount of $ 27.4 million as of June 29, 2024 and $ 39.9 million as of March 30, 2024.

Interest Rate Swaps

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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.

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.

As a result of the Company’s refinancing of the 2018 Credit Facilities in July 2022, as discussed below, 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”).

In order to avoid dedesignation, the Company elected certain practical expedients under ASC 848.

As a result, the Company’s earnings and cash flows are exposed to interest rate risk from changes to SOFR.

The Amended Swaps matured on June 15, 2023.

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.

On July 26, 2022, the Company entered into an amended and restated credit agreement to refinance its credit facilities initially entered into in 2018 and extend their maturity date through June 2025.

The 2022 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 2022 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, resulted 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 value until the maturity date in June 2025.

On June 15, 2023, two of the Company’s interest rate swaps entered into during September 2022 matured concurrently with the Amended Swaps.

The Company has concluded that the two remaining interest rate swaps entered into during September 2022, which cover 80 % of the notional value of the unsecured term loan through maturity in June 2025, are effective and qualify for hedge accounting treatment.

The Company held the following interest rate swaps as of December 30, 2023 :

Hedged Item Original Notional Amount Notional Amount as of December 30, 2023

In September 2022, the Company entered into four interest rate swaps, two of which expired in June 2023.

The Company has concluded that the two remaining interest rate swaps, which have an average blended fixed interest rate of 4.12 % plus the applicable rate and cover approximately 80 % of the notional value of the unsecured term loan through maturity in June 2025, are effective and qualify for hedge accounting treatment.

The interest rate swaps remain unchanged as a result of the 2024 refinancing of the credit facilities.

The Company held the following interest rate swaps as of June 29, 2024 :

Hedged Item Original Notional Amount Notional Amount as of June 29, 2024

Designation Date Effective Date Termination Date Fixed Interest Rate Estimated Fair Value Assets (Liabilities)

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Total $ 219,800 $ 208,600 $ 1,636

For the nine months ended December 30, 2023, the Company rec orded a gain of $ 1.3 million, ne t of tax, in accumulated other comprehensive loss to recognize the effective portion of the fair value of the swaps that qualify as cash flow hedges.

For the three months ended June 29, 2024, the Company rec orded a gain of $ 0.4 million, ne t of tax, 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

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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 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:

Three Months Ended Nine Months Ended

(In thousands) December 30, 2023 December 31, 2022 December 30, 2023 December 31, 2022

Three Months Ended

(In thousands) June 29, 2024 July 1, 2023

Beginning balance $ 5,695 $ 4,932

Credit loss 37 151

Recoveries (Write-offs) 28 19 ( 40 ) ( 166 )

Write-offs ( 13 ) ( 36 )

Ending balance $ 5,719 $ 5,047

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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 nine months ended December 30, 2023:

Derivative Instruments Amount of Gain Recognized

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(In thousands)

Designated foreign currency hedge contracts, net of tax $ 1,992 $ ( 2,745 ) Net revenues, COGS and SG&A $ 1,222 Interest and other expense, net

Non-designated foreign currency hedge contracts $ — $ — $ 1,363 Interest and other expense, net

Designated interest rate swaps, net of tax $ 1,312 $ 2 Interest and other expense, net $ —

The Company did not have fair value hedges or net investment hedges outstanding as of December 30, 2023 or April 1, 2023.

As of December 30, 2023, no material deferred taxes were recognized for designated foreign currency hedges.

Designated foreign currency hedge contracts, net of tax $ 269 $ ( 393 ) Net revenues, COGS and SG&A $ 157 Interest and other income (expense), net

Non-designated foreign currency hedge contracts $ — $ — $ 226 Interest and other income (expense), net

Designated interest rate swaps, net of tax $ 430 $ 2 Interest and other income (expense), net $ —

The Company did not have fair value hedges or net investment hedges outstanding as of June 29, 2024 or March 30, 2024.

As of June 29, 2024, 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.

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and inputs derived principally from, or corroborated by, observable market data by correlation or other means.

As of December 30, 2023, 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.

The following tables present the fair value of the Company’s derivative instruments as they appear in its Condensed Consolidated Balance Sheets as of December 30, 2023 and April 1, 2023:

As of June 29, 2024, 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.

The following tables present the fair value of the Company’s derivative instruments as they appear in its Condensed Consolidated Balance Sheets as of June 29, 2024 and March 30, 2024:

(In thousands) Location in Condensed Consolidated

Balance Sheets As of As of

December 30, 2023 April 1, 2023

June 29, 2024 March 30, 2024

Derivative Assets:

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Designated interest rate swaps Other current assets 1,636 1,673

Designated interest rate swaps Other long-term assets — 62

$ 3,553 $ 3,242

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Non-designated foreign currency hedge contracts Other current liabilities 38 536

Designated interest rate swaps Other long-term liabilities 472 1,807

$ 669 $ 1,889

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 December 30, 2023 and April 1, 2023.

As of December 30, 2023

Financial assets and financial liabilities measured at fair value on a recurring basis consist of the following as of June 29, 2024 and March 30, 2024.

As of June 29, 2024

(In thousands) Level 1 Level 2 Level 3 Total

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Non-designated foreign currency hedge contracts — 38 — 38

Designated interest rate swaps — 472 — 472

Contingent consideration — — 25,000 25,000

$ — $ 598 $ 25,000 $ 25,598

As of April 1, 2023

As of March 30, 2024

Level 1 Level 2 Level 3 Total

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Non-designated foreign currency hedge contracts — 536 — 536

Designated interest rate swaps — 1,807 — 1,807

Contingent consideration — — 863 863

$ — $ 931 $ — $ 931

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Accordingly, the fair value of contingent consideration has been classified as level 3 within the fair value hierarchy.

The level 3 fair value measurements of contingent consideration liabilities include the following significant unobservable inputs:

Fair Value at Valuation Unobservable

(In thousands) June 29, 2024 Technique Input Range

Revenue-based payments $ 19,700 Monte Carlo Simulation Model Discount rate 6.3 %

Projected year of payments 2025 - 2027

Regulatory-based payment $ 4,600 Monte Carlo Simulation Model Discount rate 6.1 %

Probability of payment 50%

Projected year of payment 2026 - 2028

Event-based payment $ 700 Monte Carlo Simulation Model Discount rate 5.8 %

Projected year of payment 2028

The fair value of contingent consideration associated with the Attune Medical acquisition was $ 25.0 million at June 29, 2024.

As of June 29, 2024, $ 5.9 million was included in other current liabilities and $ 19.1 million was included in other long-term liabilities on the Condensed Consolidated Balance Sheets.

The Company has deemed the change in fair value of the contingent consideration liability to be immaterial during the first quarter of fiscal 2025 and therefore did not record any adjustments.

A reconciliation of the change in the fair value of contingent consideration is included in the following table:

(In thousands)

Balance at March 30, 2024

Acquisition date fair value of contingent consideration 25,000

Balance at June 29, 2024

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 December 30, 2023 was $ 445.2 million, which was determined by using the market price on the last trading day of the reporting period.

The fair values of the 2026 Notes and 2029 No tes were $ 271.9 million and $ 688.0 million as o f June 29, 2024, respectively, which were determined by using the market price on the last trading day of the reporting period and are considered as level 2 in the fair value hierarchy.

The senior unsecured term loan (which is carried at amortized cost), accounts receivable and accounts payable approximate fa ir value.

COMMITMENTS AND CONTINGENCIES

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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 inquiry.

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 i ntervene in the underlying qui tam action captioned United States ex rel.

Berthelot et al.

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.

On January 12, 2024, the Company entered into an agreement with the individual plaintiffs in the qui tam case that provides for settlement of certain unrelated employment matters and releases those individuals’ claims.

The Company previously recorded a loss contingency for these matters and did not record any adjustments during the third quarter of fiscal 2024.

On January 16, 2024, the relators in the qui tam case filed a stipulation of dismissal of their claims against the Company.

The court dismissed the qui tam claims with prejudice as to the relators and without prejudice as to the government.

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.

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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 fail ure to state a claim and a motion to stay.

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 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.

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During the second quarter of fiscal 2024, the Company entered into a Memorandum of Understanding providing terms that would resolve the litigation and recorded an additional loss contingency related to this matter.

In the third quarter of fiscal 2024, the parties requested preliminary court approval of a final settlement agreement and the Company recorded an immaterial additional loss contingency related to settlement administration, resulting in a total accrual of $ 8.8 million within Other current liabilities in its Condensed Consolidated Balance Sheets.

In the third quarter of fiscal 2024, the parties

requested preliminary court approval of a final settlement agreement, which was granted in February 2024, and the Company recorded an immaterial additional loss contingency related to settlement administration, resulting in an accrual of $ 8.7 million within Other current liabilities in its consolidated balance sheets.

In March 2024, notice of the settlement was mailed to class members and the parties are now awaiting the complete administration of the settlement through the third-party administrator.

In the first quarter of fiscal 2025, the Company issued payment of the $ 8.7 million settlement amount following the court's final approval of the settlement agreement and dismissal of the matter with prejudice.

During the fourth quarter of fiscal 2024, a complaint was filed in the U.S.

District Court for the District of Delaware by Knoninklijke Philips N.V.

and IP2IPO Innovations, Ltd.

(together, the “Plaintiffs”) against OpSens, OpSens Medical, Inc., a wholly-owned subsidiary of OpSens, and Haemonetics (1:24-cv-00206-CFC).

The complaint alleges, inter alia, that OpSens’ interventional cardiology systems, including its OptoWire and OptoMonitor technology, infringe a single patent held by the Plaintiffs and seeks both injunctive relief and damages.

The Company believes it has valid and meritorious defenses to the complaint and plans to vigorously defend against the complaint.

During the first quarter of fiscal 2025, the Company recorded a loss contingency related to this matter, which did not have a material impact on its Condensed Consolidated Financial Statements.

Product Recall

1 unchanged sentence

and certain foreign jurisdictions.

As of December 30, 2023, the Company has recorded cumulative charges of $ 6.8 million related to inventory, returns and customer claims associated with this recall.

The Company continues to evaluate the impact of this recall and may record additional incremental charges in future periods.

In fiscal 2024, the Company recorded cumulative charges of $ 6.8 million related to inventory, returns and cu stomer claims associated with this recall.

Substantially all outstanding claims have been paid as of June 29, 2024.

ACCUMULATED OTHER COMPREHENSIVE LOSS

The components of Accumulated Other Comprehensive Loss are as follows:

The components of Accumulated Other Comprehensive Loss, net of tax, are as follows:

(In thousands) Foreign Currency Defined Benefit Plans Net Unrealized Gain (Loss) on Derivatives Total

Balance as of April 1, 2023 $ ( 33,935 ) $ 4,075 $ ( 521 ) $ ( 30,381 )

Balance as of March 30, 2024 $ ( 38,274 ) $ 1,748 $ 894 $ ( 35,632 )

Other comprehensive income (loss) before reclassifications (1)

( 7,343 ) — 699 ( 6,644 )

Amounts reclassified from accumulated other comprehensive income (1)

Amounts reclassified from accumulated other comprehensive loss (1)

— — ( 391 ) ( 391 )

Net current period other comprehensive income (loss) ( 7,343 ) — 308 ( 7,035 )

Balance as of December 30, 2023 $ ( 28,497 ) $ 4,075 $ 40 $ ( 24,382 )

Balance as of June 29, 2024 $ ( 45,617 ) $ 1,748 $ 1,202 $ ( 42,667 )

(1) Presented net of income taxes, the amounts of which are insignificant.

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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, amortization of acquired intangible assets, restructuring costs, restructuring related costs, digital transformation costs related to the upgrade of our enterprise resource planning system, 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;

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 Nine Months Ended

(In thousands) December 30,

2023 December 31,

2022 December 30,

2023 December 31,

Three Months Ended

(In thousands) June 29,

Net revenues (1)

Plasma $ 136,042 $ 139,491

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Hospital 134,406 102,428

Net revenues by business unit 332,127 307,290 951,469 863,191

5,586 5,372 16,395 15,918

Net revenues in constant currency 337,287 311,088

Effect of exchange rates ( 1,115 ) 244

Net revenues $ 336,172 $ 311,332

(1) Reflects revenue for service, maintenance and parts

Three Months Ended Nine Months Ended

(In thousands) December 30,

2023 December 31,

2022 December 30,

2023 December 31,

(1) Beginning in fiscal 2025, the Company integrated service revenue within its three business units.

Prior periods were conformed to current presentation.

Three Months Ended

(In thousands) June 29,

Segment operating income

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Amortization of acquired intangible assets ( 12,471 ) ( 7,473 )

Amortization of fair value inventory step-up ( 5,239 ) —

Integration and transaction costs ( 12,323 ) ( 1,115 )

5 unchanged sentences

Litigation-related charges ( 755 ) ( 1,058 )

Impairment of intangible assets — — ( 10,419 ) —

Gains on divestiture — — — 382

Gain on sale of property, plant and equipment 14,134 —

Operating income $ 39,756 $ 53,659

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Net revenues by business unit are as follows:

Three Months Ended Nine Months Ended

(In thousands) December 30,

2023 December 31,

2022 December 30,

2023 December 31,

Three Months Ended

(In thousands) June 29,

Plasma $ 135,910 $ 139,621

4 unchanged sentences

63,044 37,620

Hemostasis Management 41,423 34,921 116,241 102,737

Blood Management Technologies (2)

70,973 64,885

Hospital 134,017 102,505

Net business unit revenues 330,704 300,383 949,403 849,383

Service 5,546 4,918 16,362 14,861

Net revenues (3)

(1) Interventional Cardiology includes Vascular Closure and Sensor Guided Technologies product lines of the Hospital business unit.

(2) Other includes the Cell Salvage and Transfusion Management product lines of the Hospital business unit.

$ 336,172 $ 311,332

(1) Interventional Technologies includes Vascular Closure, Sensor Guided Technologies and Esophageal Protection product lines of the Hospital business unit.

(2) Blood Management Technologies includes Hemostasis Management, Cell Salvage and Transfusion Management product lines of the Hospital business unit.

(3) Beginning in fiscal 2025, the Company integrated service revenue within its three business units.

Prior periods were conformed to current presentation.

Net revenues generated in the Company’s principle operating regions on a reported basis are as follows:

Three Months Ended Nine Months Ended

(In thousands) December 30,

2023 December 31,

2022 December 30,

2023 December 31,

Three Months Ended

(In thousands) June 29,

United States $ 248,902 $ 237,073

5 unchanged sentences

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

What changed 10-Q

Item 1. Financial Statements