What changed in this filing

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Item 1. Financial Statements

2021-11-03 compared with 2021-08-04 · 103 added, 48 removed, 338 unchanged (31% of the section changed)

3 unchanged sentences

(dollars in thousands, except per share amounts)

September 24,

Current assets:

41 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 24,

September 25,

September 24,

September 25,

Cost of sales

5 unchanged sentences

Operating income

Interest expense

Interest expense, net

Other expense (income), net

8 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 24,

September 25,

September 24,

September 25,

Other comprehensive loss, net of tax:

5 unchanged sentences

(dollars in thousands)

For the three months ending June 25, 2021

For the three months ending September 24, 2021

Ordinary Shares

1 unchanged sentence

Shareholders'

Balance at March 26, 2021

Income (Loss)

Balance at June 25, 2021

Ordinary shares issued from exercise of stock options

Ordinary shares issued from vesting of restricted share units

Ordinary shares issued from employee share purchase plan

Share-based compensation expense

Other comprehensive loss

Balance at June 25, 2021

For the six months ending June 25, 2021

Balance at September 24, 2021

For the nine months ending September 24, 2021

Ordinary Shares

1 unchanged sentence

Shareholders'

Income (Loss)

Balance at December 25, 2020

4 unchanged sentences

Other comprehensive loss

Balance at June 25, 2021

Balance at September 24, 2021

See accompanying notes.

2 unchanged sentences

(dollars in thousands)

For the three months ending June 26, 2020

For the three months ending September 25, 2020

Ordinary Shares

Shareholders'

Balance at March 27, 2020

Balance at June 26, 2020

Ordinary shares issued from exercise of stock options

Ordinary shares issued from vesting of restricted share units

Ordinary shares issued from employee share purchase plan

Share-based compensation expense

Balance at June 26, 2020

For the six months ending June 26, 2020

Balance at September 25, 2020

For the nine months ending September 25, 2020

Ordinary Shares

5 unchanged sentences

Share-based compensation expense

Balance at June 26, 2020

Balance at September 25, 2020

See accompanying notes.

2 unchanged sentences

(in thousands)

Six Months Ended

Nine Months Ended

September 24,

September 25,

Cash flows from operating activities:

15 unchanged sentences

Purchase of marketable securities

Proceeds from maturities and sales of marketable securities

Proceeds from sale of property and equipment

7 unchanged sentences

Net cash provided by (used in) financing activities

Net decrease in cash

Net increase (decrease) in cash

Cash at beginning of period

18 unchanged sentences

We use a 52- or 53-week fiscal year ending on the last Friday in December.

The three months ended June 25, 2021 and June 26, 2020 were both 13 weeks.

References to the second quarter of 2021 and 2020 refer to the three-month periods then ended .

The three months ended September 24, 2021 and September 25, 2020 were both 13 weeks.

References to the third quarter of 2021 and 2020 refer to the three-month periods then ended .

References to fiscal year 2021 and 2020 refer to our fiscal years ending December 31, 2021 and December 25, 2020, respectively.

Fiscal year 2021 and 2020 are 53 and 52 weeks, respectively.

Use of Estimates

33 unchanged sentences

We had no significant contract assets or liabilities on our consolidated balance sheets in any of the periods presented .

Inventories are stated at the lower of cost or net realizable value.

The majority of our inventory values are based upon average costs.

On a quarterly basis, we analyze the value of our inventory and periodically record write-downs for estimated excess and obsolete inventory.

This analysis is based on estimated future consumption compared to inventory quantities on-hand.

The estimate is based on how assumptions of historical consumption, recency of purchases, backlog, and other factors indicate future consumption.

Once the value of inventory is adjusted, the original cost of our inventory, less the write-down, represents its new cost basis.

Reversal of these write-downs are recognized only when the related inventory has been scrapped or sold.

Accounting Pronouncements Recently Adopted

5 unchanged sentences

Inventories consist of the following:

September 24,

Raw materials

5 unchanged sentences

Property and equipment consist of the following:

September 24,

Leasehold improvements

4 unchanged sentences

Total property and equipment, net

Depreciation expense was $ 2.4 million and $ 2.6 million for the second quarter of 2021 and 2020, respectively, and $ 4.7 million and $ 5.0 million for the six months ended June 25, 2021 and June 26, 2020, respectively.

Depreciation expense was $ 2.8 million and $ 3.0 million for the third quarter of 2021 and 2020, respectively, and $ 7.5 million and $ 8.0 million for the nine months ended September 24, 2021 and September 25, 2020, respectively.

Cloud Computing Implementation Costs

6 unchanged sentences

Capitalized costs amortized during the period

Capitalized cloud computing implementation costs as of June 25, 2021

Capitalized cloud computing implementation costs as of September 24, 2021

Note 4 – Intangible Assets

Definite‑lived intangible assets consist of the following:

June 25, 2021

September 24, 2021

Customer relationships

14 unchanged sentences

As these amounts are variable, they are not included in lease liabilities.

As of June 25, 2021, we had zero operating lease executed for which the rental period had not yet commenced.

As of September 24, 2021, we had zero operating lease executed for which the rental period had not yet commenced.

The components of lease expense are as follows:

Three Months Ended

Six Months Ended

Nine Months Ended

September 24,

September 25,

September 24,

September 25,

Operating lease cost

Supplemental cash flow information related to leases is as follows:

Six Months Ended

Nine Months Ended

September 24,

September 25,

Cash paid for amounts included in the measurement of lease liabilities:

1 unchanged sentence

Supplemental balance sheet information related to leases is as follows:

September 24,

September 25,

Weighted-average remaining lease term of operating leases

Weighted-average discount rate of operating leases

Future minimum lease payments under non-cancelable leases as of June 25, 2021 are as follows:

Future minimum lease payments under non-cancelable leases as of September 24, 2021 are as follows:

2021, remaining

5 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 24,

September 25,

September 24,

September 25,

Income tax expense (benefit)

1 unchanged sentence

Effective income tax rate

Our effective tax rate for the three and six months ended June 25, 2021 differs from the statutory rate due to taxes on foreign income that differ from the U.S.

Our effective tax rate for the three and nine months ended September 24, 2021 differs from the statutory rate primarily due to taxes on foreign income that differ from the U.S.

tax rate, including a tax holiday in Singapore, and the impact of share-based compensation activity during the quarter.

Our effective tax rate for the three and six months ended June 26, 2020 differs from the statutory rate due to taxes on foreign income that differ from the U.S.

tax rate, excess tax benefits from share-based compensation, and the impact of the CARES Act.

The ending balance for the unrecognized tax benefits for uncertain tax positions was approximately $ 3.2 million at June 25, 2021.

Our effective tax rate for the three and nine months ended September 25, 2020 differs from the statutory rate primarily due to taxes on foreign income that differ from the U.S.

tax rate, including a tax holiday in Singapore, the impact of stock option exercises, and return-to-provision adjustments related to recently filed tax returns.

The ending balance for the unrecognized tax benefits for uncertain tax positions was approximately $ 3.2 million at September 24, 2021.

The related interest and penalties were insignificant.

The uncertain tax positions that are reasonably possible to decrease in the next twelve months are insignificant.

As of June 25, 2021, we were not under examination by tax authorities.

As of September 24, 2021, we were not under examination by tax authorities.

Note 7 – Employee Benefit Programs

2 unchanged sentences

Eligible employees receive a discretionary matching contribution equal to 50 % of a participant’s deferral, up to an annual matching maximum of 4 % of a participant’s annual compensation.

Matching contributions were $ 0.5 million and $ 0.5 million for the second quarter of 2021 and 2020, respectively and $ 1.1 million and $ 1.0 million for the six months ended June 25, 2021 and June 26, 2020, respectively.

Matching contributions were $ 0.5 million and $ 0.5 million for the third quarter of 2021 and 2020, respectively and $ 1.6 million and $ 1.5 million for the nine months ended September 24, 2021 and September 25, 2020, respectively.

Note 8 – Long-Term Debt

Long‑term debt consists of the following:

September 24,

Revolving credit facility

Total principal amount of debt

Total principal amount of long-term debt

Less unamortized debt issuance costs

Total debt, net

Total long-term debt, net

Less current portion

Total long-term debt, less current portion, net

On February 15, 2018, we entered into an amended and restated credit agreement, which includes a $ 175.0 million term loan and a $ 125.0 million revolving credit facility.

On February 15, 2018, we entered into an amended and restated credit agreement (the “2018 Credit Agreement”), which includes a $ 175.0 million term loan and a $ 125.0 million revolving credit facility.

We incurred debt issuance costs of $ 2.1 million in connection with the amendment.

1 unchanged sentence

Term loan principal payments of $ 2.2 million are due on a quarterly basis.

The credit facilities mature on February 15, 2023 .

The 2018 Credit Agreement matures on February 15, 2023 .

Interest is charged at either the Base Rate or the Eurodollar rate (as such terms are defined in the credit agreement) at our option, plus an applicable margin.

5 unchanged sentences

Eurodollar interest payments are due on the last day of the applicable interest period .

At June 25, 2021, the term loan and revolving credit facility bore interest at the Eurodollar rate option of 3.00 % and 2.03 %, respectively .

At September 24 , 2021 , the term loan and revolving credit facility bore interest at the Eurodollar rate option of 3.00 % and 2.15 %, respectively .

Subsequent Event

On October 29, 2021, we executed an amended and restated credit agreement to refinance all outstanding indebtedness under our 2018 Credit Agreement.

The credit agreement features a $ 150.0 million term loan and a revolving facility allowing for borrowings up to $ 250.0 million.

The credit agreement lowers our overall borrowing rate by (i) decreasing the applicable margin, (ii) decreasing the revolving facility commitment fee, and (iii) removing the 1.00 % Eurodollar Rate floor that was associated with the term loan.

Under the new credit agreement, the Eurodollar Rate, which was equal to LIBOR, is replaced with the Bloomberg Short-Term Bank Yield Index (‘BSBY’).

Additionally, the maturity date is extended to October 2026 , and the maximum permitted leverage ratio is increased to 3.5 x from 3.0 x.

Quarterly term loan payments of $ 1.9 million commence on March 31, 2022.

The impact of the term loan payment schedule under the new credit agreement has been recognized in these consolidated financial statements, which is reflected in the $ 5.6 million balance of current portion of long-term debt.

Note 9 – Share‑Based Compensation

5 unchanged sentences

Shares withheld are not reflected as an issuance of ordinary shares within our consolidated statements of shareholders’ equity, as the shares were never issued, and the associated tax payments are reflected as financing activities within our consolidated statements of cash flows.

Share‑based compensation expense across all plans for options, RSUs, and employee share purchase rights was $ 2.7 million and $ 2.1 million for the second quarter of 2021 and 2020, respectively, and $ 5.1 million and $ 5.0 million for the six months ended June 25, 2021 and June 26, 2020, respectively.

Share‑based compensation expense across all plans for options, RSUs, and employee share purchase rights was $ 3.0 million and $ 2.4 million for the third quarter of 2021 and 2020, respectively, and $ 8.1 million and $ 7.4 million for the nine months ended September 24, 2021 and September 25, 2020, respectively.

Stock Options

7 unchanged sentences

Forfeited or expired

Outstanding, June 25, 2021

Exercisable, June 25, 2021

Outstanding, September 24, 2021

Exercisable, September 24, 2021

Restricted Share Units

3 unchanged sentences

Unvested, December 25, 2020

Unvested, June 25, 2021

Unvested, September 24, 2021

Employee Share Purchase Plan

2 unchanged sentences

Shares are purchased on the last day of the purchase period.

During the six months ended June 25, 2021, 27,151 ordinary shares were purchased by eligible employees under the 2017 ESPP.

As of June 25, 2021, approximately 2.4 million ordinary shares remain available for purchase under the 2017 ESPP.

During the nine months ended September 24, 2021, 48,643 ordinary shares were purchased by eligible employees under the 2017 ESPP.

As of September 24, 2021, approximately 2.3 million ordinary shares remain available for purchase under the 2017 ESPP.

Note 10 – Earnings per Share

1 unchanged sentence

Three Months Ended

Six Months Ended

Nine Months Ended

September 24,

September 25,

September 24,

September 25,

Basic weighted average ordinary shares outstanding

3 unchanged sentences

Diluted weighted average ordinary shares outstanding

Securities excluded from diluted weighted average ordinary shares outstanding (1)

Earnings per share:

A combined total of approximately 185,000 , 1,790,000 , 185,000 , and 1,555,000 potentially dilutive options and RSUs were excluded from the calculation of net income per share for the three and six months ended June 25, 2021 and June 26, 2020, respectively, because including them would have been antidilutive under the treasury stock method.

Represents potentially dilutive options and RSUs excluded from the calculation of diluted weighted average ordinary shares outstanding, because including them would have been antidilutive under the treasury stock method.

Note 11 – Fair Value Measurements

6 unchanged sentences

Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

As of June 25, 2021, assets measured at fair value on a recurring basis were as follows:

As of September 24, 2021, assets measured at fair value on a recurring basis were as follows:

Cash equivalents:

Money market funds

Commercial paper

Marketable securities:

13 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 24,

September 25,

September 24,

September 25,

United States of America

Total net sales

Foreign long-lived assets, exclusive of deferred tax assets, were $ 39.8 million and $ 31.5 million at June 25, 2021 and December 25, 2020, respectively .

Foreign long-lived assets, exclusive of deferred tax assets, were $ 40.1 million and $ 31.5 million at September 24, 2021 and December 25, 2020, respectively .

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