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Item 7. Management’s Discussion and Analysis

2024-05-29 compared with 2023-05-26 · 215 added, 218 removed, 508 unchanged (46% of the section changed)

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FINANCIAL MEASURES

In the following sections of the MD&A, we may, at times, refer to financial measures that are not required to be presented in the consolidated financial statements under U.S.

In the following sections of the MD&A, we may, at times, refer to financial measures that are not required to be presented in the consolidated financial statements under accounting principles generally accepted in the United States ("U.S.

We sometimes use the following financial measures in the context of this report:

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• Service Revenues – We define service revenues as revenues generated from parts and labor associated with the maintenance, repair, and installation of our capital equipment.

Service revenues also include outsourced reprocessing services and instrument and scope repairs, as well as revenues generated from contract sterilization and laboratory services offered through our Applied Sterilization Technologies segment.

• Capital Equipment Revenues – We define capital equipment revenues as revenues generated from sales of capital equipment, which includes:

steam and gas sterilizers, low temperature liquid chemical sterilant processing systems, pure steam/water systems, surgical lights and tables, and integrated OR.

• Consumable Revenues – We define consumable revenues as revenues generated from sales of the consumable family of products, which includes dedicated consumables including V-PRO, SYSTEM 1 and 1E consumables, gastrointestinal endoscopy accessories, sterility assurance products, barrier protection solutions, cleaning consumables, dental and surgical instruments.

• Capital Equipment Revenues – We define capital equipment revenues as revenues generated from sales of capital equipment, which includes steam and gas sterilizers, low temperature liquid chemical sterilant processing systems, pure steam/water systems, surgical lights and tables, and integrated OR.

• Consumable Revenues – We define consumable revenues as revenues generated from sales of the consumable family of products, which includes dedicated consumables used in our V-PRO sterilizers and automated endoscope reprocessors, SYSTEM 1 and 1E consumables, gastrointestinal endoscopy accessories, instruments and tools, sterility assurance products, barrier protection solutions, and cleaning consumables.

• Recurring Revenues – We define recurring revenues as revenues generated from sales of consumable products and service revenues.

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STERIS is a leading global provider of products and services that support patient care with an emphasis on infection prevention.

WE HELP OUR CUSTOMERS CREATE A HEALTHIER AND SAFER WORLD by providing innovative healthcare, life sciences and dental products and services.

We offer our Customers a unique mix of innovative consumable products, such as detergents, endoscopy accessories, barrier products, and other products and services, including:

equipment installation and maintenance, microbial reduction of medical devices, dental instruments and tools, instrument and scope repair, laboratory testing services, outsourced reprocessing, and capital equipment products, such as sterilizers and surgical tables, automated endoscope reprocessors, and connectivity solutions such as operating room (“OR”) integrati on.

We operate and report our financial information in four reportable business segments:

Healthcare, Applied Sterilization Technologies, Life Sciences and Dental.

Non-allocated operating costs that support the entire Company and items not indicative of operating trends are excluded from segment operating income.

WE HELP OUR CUSTOMERS CREATE A HEALTHIER AND SAFER WORLD by providing innovative healthcare and life science products and services around the globe.

We offer our Customers a unique mix of innovative products and services.

These include:

consumable products, such as detergents, endoscopy accessories, barrier products, instruments and tools;

and services, including equipment installation and maintenance, microbial reduction of medical devices, instrument and scope repair, laboratory testing, outsourced reprocessing;

and capital equipment, such as sterilizers, surgical tables, and automated endoscope reprocessors, and connectivity solutions such as operating room (“OR”) integrati on.

We operate and report our financial information in three reportable business segments:

Healthcare, Applied Sterilization Technologies ("AST"), and Life Sciences.

Previously, we had four reportable business segments;

however, as a result of the agreement to divest our Dental segment, Dental is presented as discontinued operations.

Historical information has been retrospectively adjusted to exclude discontinued operations for comparability, as required.

For more information, refer to Note 4 to our consolidated financial statements titled, "Discontinued Operations." Non-allocated operating costs that support the entire Company and items not indicative of operating trends are excluded from segment operating income.

We describe our business segments in Note 13 to our consolidated financial statements titled, "Business Segment Information."

The bulk of our revenues are derived from the healthcare and pharmaceutical industries.

The bulk of our revenues are derived from healthcare, medical device and pharmaceutical Customers.

Much of the growth in these industries is driven by the aging of the population throughout the world, as an increasing number of individuals are entering their prime healthcare consumption years, and is dependent upon advancement in healthcare delivery, acceptance of new technologies, government policies, and general economic conditions.

The pharmaceutical industry has been impacted by increased regulatory scrutiny of cleaning and validation processes, mandating that manufacturers improve their processes.

Within healthcare, there is increased concern regarding the level of hospital acquired infections around the world;

increased demand for medical procedures, including preventive screenings such as endoscopies and colonoscopies;

In addition, there is increased demand for medical procedures, including preventive screenings such as endoscopies and colonoscopies;

and a desire by our Customers to operate more efficiently, all which are driving increased demand for many of our products and services.

Acquisitions .

During fiscal 2023, we completed several tuck-in acquisitions which expanded our product and service offerings in the Applied Sterilization Technologies and Healthcare segments.

On August 2, 2023, we purchased the surgical instrumentation, laparoscopic instrumentation and sterilization container assets from Becton, Dickinson and Company ("BD") (NYSE:

The acquired assets from BD are being integrated into our Healthcare segment.

The purchase price of the acquisition was $539.8 million.

The acquisition also qualified for a tax benefit related to tax deductible goodwill, with a present value of approximately $60.0 million.

The purchase price of the acquisition was financed with borrowings from our existing credit facility.

For more information, refer to Note 8 to our consolidated financial statements titled, " Debt."

In addition to the acquisition of BD, we completed two other tuck-in acquisitions during fiscal 2024, which expanded our product and service offerings in the AST and Healthcare segments.

Total aggregate consideration was approximately $6.5 million, net of cash acquired.

During fiscal 2023, we completed several tuck-in acquisitions which expanded our product and service offerings in the AST and Healthcare segments.

Total aggregate consideration was approximately $49.8 million, including potential contingent consideration of $7.3 million.

On June 2, 2021, we acquired all outstanding equity interests in Cantel Medical LLC ("Cantel") through a U.S.

Cantel, formerly headquartered in Little Falls, New Jersey, with approximately 3,700 employees, is a global provider of infection prevention products and services primarily to endoscopy and dental Customers.

The total consideration for Cantel Common Stock and stock equivalents was $3.6 billion .

We believe that the acquisition will strengthen STERIS’s leadership in infection prevention by bringing together two complementary businesse s able to offer a broader set of Customers a more diversified selection of infection prevention, endoscopy and sterilization products and services.

Cantel’s Dental business extended our business into a new Customer segment where there is an increasing focus on infection prevention protocols and processes.

This business is reported as the Dental segment.

The rest of Cantel was integrated into our existing Healthcare and Life Sciences segments.

Additionally, the acquisition is expected to result in cost savings from optimizing global back-office infrastructure, leveraging best-demonstrated practices across locations and eliminating redundant public company costs.

The results of Cantel are only reflected in the results of operations and cash flows from June 2, 2021 forward, which will affect results of comparability to the prior period operations and cash flows.

In addition to the acquisition of Cantel, we completed three other tuck-in acquisitions during fiscal 2022, which continued to expand our product and service offerings in the Healthcare segment.

Total aggregate consideration for these transactions was approximately $3.1 million, net of cash acquired and including deferred consideration of $0.1 million.

Divestitures.

In April 2022, we entered into an Asset Purchase Agreement to sell certain assets of our Animal Health business to Veterinary Orthopedic Implants, LLC.

We recorded net proceeds of $5.2 million and recognized a pre-tax loss on the sale of $4.9 million in the Selling, general, and administrative expenses line of the Consolidated Statements of Income.

The business generated annual revenues of approximately $12.0 million.

In December 2021, we entered into an Asset Purchase Agreement to sell our Renal Care business to Evoqua Water Technologies Corp.

for cash consideration of approximately $196.0 million, subject to certain potential adjustments, including a customary working capital adjustment and contingent consideration of $12.3 million.

We recognized a gain on the sale of $4.9 million.

The transaction closed on January 3, 2022.

We acquired the Renal Care business as part of the Cantel transaction, which closed on June 2, 2021, and had been integrated into STERIS's Healthcare segment.

The Renal Care business generated annual revenues of approximately $180.0 million.

The proceeds from the sale received at closing were used to repay outstanding debt.

During the third quarter of fiscal 2023, we received an additional $1.4 million in working capital settlements related to the sale of this business.

Divestitures and Discontinued Operations.

On April 11, 2024, the Company announced its plan to sell its Dental segment for total cash consideration of $787.5 million, subject to customary adjustments, and up to an additional $12.5 million in contingent payment should the Dental business achieve certain revenue targets in fiscal 2025.

The transaction is structured as an equity sale.

A component of an entity is reported in discontinued operations after meeting the criteria for held for sale classification if the disposition represents a strategic shift that has (or will have) a major effect on the entity's operations and financial results.

We analyzed the quantitative and qualitative factors relevant to the divestiture of our Dental segment and determined that those conditions for discontinued operations presentation had been met prior to March 31, 2024.

The Dental segment results of operations have been reclassified to income (loss) from discontinued operations in the Consolidated Statements of Income and we have classified our Dental segment's assets and liabilities as held for sale for all periods presented in the accompanying Consolidated Balance Sheets.

Previously, the Dental business was a separate reportable segment.

For additional information regarding this transaction and its effect on our financial reporting, refer to Note 4 titled "Discontinued Operations" and Note 13 titled "Business Segment Information." Proceeds received from the sale will be used to pay off existing debt.

On April 1, 2024, we completed the sale of the Controlled Environment Certification Services business.

In fiscal 2025, we recorded net proceeds of $41.5 million.

The business generated approximately $35.0 million in revenue during fiscal 2024.

For more information regarding our recent acquisitions and divestitures, see Note 3 to our consolidated financial statements titled, " Business Acquisitions and Divestitures ."

Revenues increased $602.4 million, or 13.3%, to $5,138.7 million for the year ended March 31, 2024, as compared to $4,536.3 million for the year ended March 31, 2023.

These increases reflect growth in the Healthcare, Applied Sterilization Technologies, Life Sciences, and Dental segments, partially offset by unfavorable fluctuations in currencies and divestiture activities.

These increases reflect higher volume, including the added volume from the acquisition of assets from BD in the Healthcare segment, and pricing.

Our gross profit percentage decreased to 43.2% for fiscal 2024 as compared to 43.7% for fiscal 2023.

Unfavorable impacts from inflation and productivity were partially offset by favorable impacts from pricing, mix, divestiture activity and fluctuations in currency.

Fiscal 2023 operating income decreased 37.0% to $268.2 million, as compared to fiscal 2022 operating income of $425.6 million.

This decline was primarily due to a one time goodwill impairment charge of $490.6 million offset by a decrease in acquisition and integration expenses, which were primarily related to our acquisition of Cantel, as well as an increase in amortization of purchased intangible assets.

Cash flows from operations were $756.9 million and free cash flow was $409.6 million in fiscal 2023 compared to cash flows from operations of $684.8 million and free cash flow of $399.0 million in fiscal 2022 (see subsection of MD&A titled, "Non-GAAP Financial Measures" for additional information and related reconciliation of cash flows from operations to free cash flow) .

The fiscal 2023 increase in cash flows from operations was primarily from lower costs associated with the acquisition and integration of Cantel, partially offset by higher working capital, particularly inventory and accounts receivable.

The increase in free cash flow was limited by increased capital spending.

Unfavorable impacts from productivity, inflationary cost increases for materials and labor, and restructuring charges were partially offset by favorable impacts from pricing.

Fiscal 2024 income from operations increased 5.7% to $836.1 million over fiscal 2023 income from operations of $791.1 million.

This increase was primarily due to the benefit of higher volume and pricing during fiscal 2024 which was partially offset by restructuring charges incurred during fiscal 2024.

Cash flows provided by operating activities were $973.3 million and free cash flow was $620.3 million in fiscal 2024 compared to cash flows provided by operating activities of $756.9 million and free cash flow of $409.6 million in fiscal 2023 (see subsection of MD&A titled, "Non-GAAP Financial Measures" for additional information and related reconciliation of cash flows from operations to free cash flow).

Cash flows from operations resulted from the increase in operating activity and lower use of cash for working capital requirements.

The increase in free cash flow was driven by cash flows from operations as capital spending in fiscal 2024 was comparable to fiscal 2023.

Our debt-to-total capital ratio was 33.7% at March 31, 2024.

During the year, we increased our quarterly dividend for the seventeenth consecutive year to $0.47 per share per quarter.

During the year, we increased our quarterly dividend for the eighteenth consecutive year to $0.52.

In fiscal 2025 and beyond, we expect to manage our costs, grow our business with internal product and service development, invest in greater capacity, and augment these value creating methods with potential acquisitions of additional products and services.

We anticipate continued supply chain and inflation pressures in fiscal 2024.

We anticipate continued inflation pressure in fiscal 2025, but not at the significant level experienced in fiscal 2024 and 2023.

Please refer to "Information With Respect to Our Business In General" in Item 1."Business" to this Annual Report on Form 10-K.

NON-GAAP FINANCIAL MEASURES

We, at times, refer to financial measures which are considered to be “non-GAAP financial measures” under SEC rules.

We, at times, refer to financial measures which are considered to be “non-GAAP financial measures” under the Securities and Exchange Commission rules.

We, at times, also refer to our results of operations excluding certain transactions or amounts that are non-recurring or are not indicative of future results, in order to provide meaningful comparisons between the periods presented.

These non-GAAP financial measures are not intended to be, and should not be, considered separately from or as an alternative to the most directly comparable GAAP financial measures.

These non-GAAP financial measures are not intended to be, and should not be, considered separately from or as an alternative to the most directly comparable U.S.

GAAP financial measures.

These non-GAAP financial measures are presented with the intent of providing greater transparency to supplemental financial information used by management and the Board of Directors in their financial analysis and operational decision-making.

These amounts are disclosed so that the reader has the same financial data that management uses with the belief that it will assist investors and other readers in making comparisons to our historical operating results and analyzing the underlying performance of our operations for the periods presented.

We believe that the presentation of these non-GAAP financial measures, when considered along with our GAAP financial measures and the reconciliation to the corresponding GAAP financial measures, provides the reader with a more complete understanding of the factors and trends affecting our business than could be obtained absent this disclosure.

We believe that the presentation of these non-GAAP financial measures, when considered along with our U.S.

GAAP financial measures and the reconciliation to the corresponding U.S.

GAAP financial measures, provides the reader with a more complete understanding of the factors and trends affecting our business than could be obtained absent this disclosure.

It is important for the reader to note that the non-GAAP financial measures used may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.

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We begin with a general overview of our operating results and then separately discuss earnings for our operating segments.

As a result of the agreement to divest our Dental segment, Dental is presented as discontinued operations.

Historical information has been retrospectively adjusted to reflect these changes for comparability, as required.

Therefore, the discussion within this Results of Operations section excludes discontinued operations and relates solely to our continuing operations.

The discussion of and factors affecting our performance for the year ended March 31, 2023 compared to the fiscal year ended March 31, 2022 is included in Item 7.

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Other foreign revenues 1,304,569 1,207,601 96,968 8.0 %

(1) Allocation of revenue by geography is based on the location of delivery or distribution of products or location where services are performed.

Revenues increased $602.4 million, or 13.3%, to $5,138.7 million for the year ended March 31, 2024, as compared to $4,536.3 million for the year ended March 31, 2023.

These increases reflect added volume in the Healthcare, Applied Sterilization Technologies, and Life Sciences segments and the benefits of a full year of Cantel activity and price increases in all segments.

These positives were partially offset by unfavorable fluctuations in currencies and divestiture activities.

Service revenues for fiscal 2023 increased $143.7 million, or 7.1% over fiscal 2022, reflecting growth in the Healthcare, Life Sciences and Applied Sterilization Technologies business segments.

Consumable revenues for fiscal 2023 increased $107.8 million, or 6.7%, over fiscal 2022, reflecting growth in the Healthcare and Life Sciences segments and the benefit of a full year of Cantel activity.

Capital equipment revenues for fiscal 2023 increased by $121.3 million, or 12.8%, over fiscal 2022, driven by organic growth in the Healthcare and Life Sciences segments.

Ireland revenues for fiscal 2023 were $74.5 million, representing a decline of $7.5 million, or 9.2%, as compared to fiscal 2022 revenues of $82.0 million, reflecting declines in service and consumable revenues.

United States revenues for fiscal 2023 were $3,586.5 million, representing an increase of $357.6 million, or 11.1%, over fiscal 2022 revenues of $3,228.9 million, reflecting growth in service and capital equipment revenues.

These increases reflect higher volume, including the added volume from the acquisition of assets from BD in the Healthcare segment, and pricing.

Service revenues for fiscal 2024 increased $202.2 million, or 9.3% over fiscal 2023, reflecting growth in the Healthcare, AST, and Life Sciences segments.

Consumable revenues for fiscal 2024 increased $209.1 million, or 16.2%, over fiscal 2023, reflecting growth in the Healthcare and Life Sciences segments.

Capital equipment revenues for fiscal 2024 increased by $191.1 million, or 17.9%, over fiscal 2023, reflecting growth in the Healthcare and Life Sciences segments, which were partially offset by a decline in the AST segment.

Ireland revenues for fiscal 2024 were $82.7 million, representing an increase of $8.4 million, or 11.3%, over fiscal 2023 revenues of $74.3 million, reflecting growth in service and consumable revenues, which were partially offset by a decline in capital equipment revenues.

United States revenues for fiscal 2024 were $3,751.4 million, representing an increase of $497.1 million, or 15.3%, over fiscal 2023 revenues of $3,254.4 million, reflecting growth in service, consumable, and capital equipment revenues.

Revenues from other foreign locations for fiscal 2024 were $1,304.6 million, representing an increase of $97.0 million, or 8.0% over the fiscal 2023 revenues of $1,207.6 million.

The increase reflects growth within the EMEA, Canada, and Latin American regions, which was partially offset by declines in the Asia Pacific region.

The increase reflects growth within the Europe, Middle East & Africa, Canada, Asia Pacific and Latin American regions driven by increases in service, consumable, and capital equipment revenues.

Gross Profit.

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Our gross profit percentage decreased to 43.2% for fiscal 2024 as compared to 43.7% for fiscal 2023.

Unfavorable impacts from inflation (330 basis points) and productivity (50 basis points) were partially offset by favorable impacts from pricing (150 basis points), mix and other adjustments (130 basis points), divestiture activity (40 basis points), and fluctuations in currency (20 basis points).

Unfavorable impacts from inflation and material costs (120 basis points), restructuring charges (40 basis points), adjustments and other charges (40 basis points), productivity (30 basis points), and fluctuations in currency (10 basis points) were partially offset by favorable impacts from pricing (150 basis points), mix (30 basis points), and acquisitions (10 basis points).

Operating Expenses.

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Selling, general, and administrative $ 1,252,318 $ 1,090,663 $ 161,655 14.8 %

Goodwill impairment loss 490,565 — 490,565 NM

Research and development 103,679 98,477 5,202 5.3 %

Restructuring expenses 485 48 437 910.4 %

Restructuring expenses 26,045 485 25,560 NM

Total operating expenses $ 1,382,042 $ 1,189,625 $ 192,417 16.2 %

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Selling, General, and Administrative Expenses.

Significant components of total Selling, general, and administrative expenses (“SG&A”) are compensation and benefit costs, fees for professional services, travel and entertainment, facilities costs, gains or losses from divestitures, and other general and administrative expenses.

SG&A decreased 13.6% in fiscal 2023, as compared to fiscal 2022.

The fiscal 2023 reduction reflects lower spending for acquisition and integration expenses, which were primarily related to our acquisition of Cantel, and a decline in incentive compensation plan expense.

Goodwill Impairment Loss.

A goodwill impairment loss of $490.6 million was recorded during the second quarter of fiscal 2023 as the result of an assessment of the fair value of the Dental segment made in connection with the preparation of our quarterly consolidated financial statements.

For more information regarding our goodwill impairment loss, see Note 3 to our consolidated financial statements titled, "Goodwill and Intangible Assets."

Significant components of total selling, general, and administrative expenses (“SG&A”) are compensation and benefit costs, fees for professional services, travel and entertainment expenses, facility costs, gains or losses from divestitures, and other general and administrative expenses.

SG&A increased 14.8% in fiscal 2024 over fiscal 2023.

The fiscal 2024 increase is primarily attributable to increased compensation, including incentive compensation and benefit costs, as well as increase in dealer incentives and professional fees.

Research and Development.

Research and development expenses increased $13.6 million in fiscal 2023 over fiscal 2022, primarily due to the addition of Cantel and other recent acquisitions.

Research and development expenses increased $5.2 million in fiscal 2024 over fiscal 2023.

Research and development expenses are influenced by the number and timing of in-process projects and labor hours and other costs associated with these projects.

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During fiscal 2024, our investments in research and development have continued to be focused on, but were not limited to, enhancing capabilities of sterile processing combination technologies, procedural products and accessories, and devices and support accessories used in gastrointestinal endoscopy procedures.

Restructuring Expenses.

We adopted and announced a targeted restructuring plan (the "Restructuring Plan").

This plan includes a strategic shift in our approach to the Healthcare surgical business in Europe, as well as other actions including the impairment of an internally developed X-ray accelerator, product rationalizations and facility consolidations.

Less than 300 positions are being eliminated.

These restructuring actions are designed to enhance profitability and improve efficiency, and we expect to be substantially complete with the actions by the end of fiscal 2025.

We are anticipating improvements in income from operations of approximately $25.0 million per year, with the majority of the benefit being in fiscal 2026 and beyond due to timing of actions.

We have incurred pre-tax expenses totaling $44.4 million related to these restructurings in fiscal 2024, of which $26.1 million was recorded as restructuring expenses and $18.3 million was recorded in Cost of revenues.

A total of $19.0 million and $25.4 million was recorded to the Healthcare and AST segments, respectively, while a total of $40.0 thousand was related to Corporate.

We expect to incur additional restructuring expenses related to this plan of approximately $55.3 million, which includes $51.3 million related to Healthcare, $3.0 million related to AST, $0.8 million related to Life Sciences, and $0.2 million related to Corporate.

The $55.3 million is comprised of $36.2 million related to severance and other compensation related costs, $15.3 million related to lease and other contract termination and other costs, and $3.8 million related to accelerated depreciation and amortization.

The following table summarizes our total pre-tax restructuring expenses recorded in fiscal 2024 related to the Restructuring Plan:

Year Ended March 31, 2024 Restructuring Plan

Asset impairment

Product rationalization (1)

Severance and other compensation related costs

Total Restructuring Expense

(1) Recorded in Cost of revenues on the Consolidated Statements of Income.

Non-Operating Expenses, Net.

Non-operating expenses, net consists of interest expense on debt, offset by interest earned on cash, cash equivalents, short-term investment balances, a fair value adjustment related to convertible debt, and other miscellaneous expense (income).

Non-operating expenses, net consists of interest expense on debt, offset by interest earned on cash, cash equivalents, short-term investment balances, and other miscellaneous (income) expense.

The following table compares our net non-operating expenses, net for the year ended March 31, 2024 to the year ended March 31, 2023:

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Interest expense $ 144,351 $ 107,956 $ 36,395

Fair value adjustment related to convertible debt, premium liability — 27,806 (27,806)

Interest and miscellaneous expense (income) 2,848 (6,284) 9,132

Interest and miscellaneous (income) expense (11,043) 2,879 (13,922)

Non-operating expenses, net $ 133,308 $ 110,835 $ 22,473

Interest expense increased $18.4 million during fiscal 2023 over fiscal 2022, primarily due to higher interest rates on floating rate debt.

During fiscal 2022, we recorded fair value adjustments of $27.8 million, based on appreciation in our share price related to premium liability associated with the convertible debt assumed in the acquisition of Cantel.

Additional information regarding our outstanding debt and Cantel convertible debt is included in Note 6 to our consolidated financial statements titled, "Debt," and in the subsection of this MD&A titled, "Liquidity and Capital Resources."

Interest and miscellaneous expense (income) decreased $9.1 million during fiscal 2023, as compared to 2022, primarily due to losses recognized as a result of mark to market adjustments of our equity investments.

Additional information regarding our mark to market adjustments of our equity investments is included in Note 17 to our consolidated financial statements titled, "Fair Value Measurements."

Interest expense increased $36.4 million during fiscal 2024 over fiscal 2023, primarily due to higher interest rates and principal amount of outstanding floating rate debt.

For more information, refer to Note 8 to our consolidated financial statements titled, "Debt."

The fluctuation in interest and miscellaneous (income) expense during fiscal 2024, as compared to fiscal 2023, totaled $13.9 million and is primarily attributable to gains recognized as a result of mark to market adjustments which were realized upon the sale of an equity investment as well as interest income accrued on an income tax refund.

Additional information regarding the mark to market adjustments of our equity investments is included in Note 19 to our consolidated financial statements titled, "Fair Value Measurements."

Income Tax Expense.

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Effective income tax rate 21.3 % 18.2 %

The effective income tax rate for fiscal 2023 was 32.8% when compared to 22.8% for fiscal 2022.

The fiscal 2023 effective tax rate increased when compared to 2022, primarily due to the tax impact of the goodwill impairment loss recognized on the Dental segment during the second quarter of fiscal 2023.

The fiscal 2023 effective tax rate was also favorably impacted by changes in U.S.

state and local tax rates applied to existing deferred tax assets and liabilities.

The effective income tax rates from continuing operations for fiscal 2024 was 21.3% compared to 18.2% for fiscal 2023.

The fiscal 2024 effective tax rate from continuing operations increased when compared to 2023, primarily due to non-recurring favorable discrete items recognized in fiscal 2023.

Additional information regarding our income tax expense and effective income tax rate, is included in Note 10 to our consolidated financial statements titled, "Income Taxes."

Business Segment Results of Operations.

We operate and report our financial information in four reportable business segments:

Healthcare, Applied Sterilization Technologies, Life Sciences and Dental.

Non-allocated operating costs that support the entire Company and items not indicative of operating trends are excluded from segment operating income.

We operate and report our financial information in three reportable business segments:

Healthcare, AST, and Life Sciences.

Previously, we had four reportable business segments;

however, as a result of the agreement to divest our Dental segment, Dental is presented as discontinued operations.

Historical information has been retrospectively adjusted to reflect these changes for comparability, as required.

Our Healthcare segment provides a comprehensive offering for healthcare providers worldwide, focused on sterile processing departments and procedural centers, such as operating rooms and endoscopy suites.

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to outsourced instrument reprocessing services.

In addition, our procedural solutions also include endoscopy accessories and capital equipment infrastructure used primarily in operating rooms, ambulatory surgery centers, endoscopy suites, and other procedural areas.

Our Applied Sterilization Technologies ("AST") segment is a third-party service provider for contract sterilization, as well as testing services needed to validate sterility services for medical device and pharmaceutical manufacturers.

In addition, our procedural solutions also include endoscopy accessories, instruments, and capital equipment infrastructure used primarily in operating rooms, ambulatory surgery centers, endoscopy suites, and other procedural areas.

Our AST segment supports medical device and pharmaceutical manufacturers through a global network of contract sterilization and laboratory testing facilities, and integrated sterilization equipment and control systems.

Our technology-neutral offering supports Customers every step of the way, from testing through sterilization.

Our Life Sciences segment provides a comprehensive offering of products and services that support pharmaceutical manufacturing, primarily for vaccine and other biopharma Customers focused on aseptic manufacturing.

These solutions include a full suite of consumable products, equipment maintenance and specialty services, and capital equipment.

Our Dental segment provides a comprehensive offering for dental practitioners and dental schools, offering instruments, infection prevention consumables and instrument management systems.

Our Life Sciences segment provides a comprehensive offering of products and services designed to support biopharmaceutical and medical device research and manufacturing facilities, in particular those focused on aseptic manufacturing.

Our portfolio includes a full suite of consumable products, equipment maintenance, specialty services, and capital equipment.

We disclose a measure of segment income that is consistent with the way management operates and views the business.

The accounting policies for reportable segments are the same as those for the consolidated Company.

Certain prior period costs were reallocated from the Healthcare segment to Corporate to conform with current year presentation.

The prior period segment operating income measure has been recast for comparability.

For more information regarding our segments please refer to Note 13 to our consolidated financial statements titled, "Business Segment Information," and Item 1, "Business."

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Years ended March 31,

As reported, GAAP Impact of Acquisitions Impact of Divestitures Impact of Foreign Currency Movements GAAP Growth Organic Growth Constant Currency Organic Growth

As reported, U.S.

GAAP Impact of Acquisitions Impact of Divestitures Impact of Foreign Currency Movements U.S.

GAAP Growth Organic Growth Constant Currency Organic Growth

2024 2023 2024 2023 2024 2024 2024 2024

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Healthcare $ 3,613,019 $ 3,085,131 $ 119,285 $ — $ 13,584 17.1 % 13.2 % 12.8 %

Applied Sterilization Technologies 914,431 852,972 — — (37,750) 7.2 % 7.2 % 11.6 %

AST 953,980 914,431 — — 10,449 4.3 % 4.3 % 3.2 %

Life Sciences 571,702 536,704 — — 3,621 6.5 % 6.5 % 5.8 %

Dental 421,573 361,661 65,009 — (6,442) 16.6 % (1.4) % 0.4 %

Total $ 5,138,701 $ 4,536,266 $ 119,285 $ — $ 27,654 13.3 % 10.7 % 10.0 %

Healthcare revenues increased 8.4% in fiscal 2023, as compared to fiscal 2022, reflecting growth in capital equipment, service, and consumable revenues of 14.6%, 7.5%, and 4.6% respectively.

This increase reflects increased volume and pricing,

partially offset by unfavorable fluctuations in currencies.

T he Healthcare segment’s backlog at March 31, 2023 amounted to $494.7 million.

Excluding Cantel, the Healthcare segment's backlog at March 31, 2022 was $423.6 million .

In addition to the added volume from Cantel, the increase is primarily due to built up demand and supply chain disruptions.

Organic revenue growth and constant currency organic revenue growth are non-GAAP financial measures of revenue performance.

Organic revenue growth is calculated by removing the impact of acquisitions and divestitures for one year following the respective transaction from the GAAP revenue growth.

Constant currency organic revenue growth is subject to a further adjustment to eliminate the impact of foreign currency movements.

Healthcare revenues increased 17.1% in fiscal 2024, as compared to fiscal 2023, reflecting growth in capital equipment, consumable, and service revenues of 21.7%, 18.9%, 11.8%, respectively.

The constant currency organic growth of 12.8% is primarily due to increased volume, impacting revenues by a low double digit percentage, as well as increased pricing.

The Healthcare segment’s backlog at March 31, 2024 amounted to $353.8 million.

The Healthcare segment's backlog at March 31, 2023 was $494.7 million.

The decrease is due to increased shipments during fiscal 2024 as compared to fiscal 2023, resulting from shortened lead times and easing of supply chain constraints.

AST revenues increased 4.3% in fiscal 2024, as compared to fiscal 2023.

The increase was primarily due to increases in volume and pricing, partially offset by unfavorable fluctuations in currencies.

Life Sciences revenues increased 2.2% in fiscal 2023, as compared to fiscal 2022 reflecting growth in capital equipment, service, and consumable revenues of 3.6%, 3.4%, and 0.7% respectively.

This increase was driven by increased volume and pricing, partially offset by divestiture activity and unfavorable fluctuations in currency.

The constant currency organic growth of 3.2% is primarily due to increased pricing, impacting revenues by a mid-single digit percentage, partially offset by lower volume.

Revenue was negatively impacted by medical device Customer inventory management and the continued reduction in demand from bioprocessing Customers.

Life Sciences revenues increased 6.5% in fiscal 2024, as compared to fiscal 2023 reflecting growth in service, capital equipment, and consumable revenues of 11.1%, 5.5%, 4.3% respectively.

The constant currency organic growth of 5.8% is primarily due to increased pricing, impacting revenues by a mid-single digit percentage, as well as higher volume.

The Life Sciences backlog at March 31, 2024 and 2023 amounted to $71.4 million and $104.9 million, respectively.

Dental segment revenues increased 16.6% to $421.6 million in fiscal 2023 , as compared to $361.7 million from the Cantel acquisition date of June 2, 2021 through March 31, 2022 .

The increase was driven primarily by the timing of the Cantel acquisition.

The decrease is primarily due to the timing of shipments and a decrease in orders as compared to the same period in the prior year.

The following table compares business segment and Corporate operating income for the year ended March 31, 2024 to the year ended March 31, 2023

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Healthcare 871,358 706,020 165,338 23.4 %

Applied Sterilization Technologies 429,020 410,101 18,919 4.6 %

AST 439,744 429,020 10,724 2.5 %

Life Sciences 221,349 210,225 11,124 5.3 %

Dental 89,527 84,441 5,086 6.0 %

Corporate (348,497) (264,974) (83,523) 31.5 %

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Gain on fair value adjustment of acquisition related contingent consideration (1)

(3,100) (2,350)

Net gain on divestiture of businesses (1)

Net loss (gain) on divestiture of businesses (1)

Amortization of inventory and property "step up" to fair value (1)

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Restructuring charges (4)

Goodwill impairment loss (4)

Total operating income $ 268,185 $ 425,618

Income from operations $ 836,118 $ 791,101

(1) For more information regarding our recent acquisitions and divestitures, refer to Note 3 to our consolidated financial statements titled, " Business Acquisitions and Divestitures ."

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(3) Costs incurred in connection with the Redomiciliation and subsequent tax restructuring.

(4) For more information regarding our goodwill impairment loss, refer to Note 3 to our consolidated financial statements titled, "Goodwill and Intangible Assets."

The Healthcare segment’s operating income increased $56.3 million to $706.0 million in fiscal year 2023, as compared to $649.7 million in fiscal year 2022, due to higher volumes as well as the favorable impact from pricing.

(4) For more information regarding our restructurings, refer to Note 2 to our consolidated financial statements titled, "Restructuring."

The Healthcare segment’s operating income increased $165.3 million to $871.4 million in fiscal year 2024, as compared to $706.0 million in fiscal year 2023.

The segment's operating margins were 24.1% for fiscal year 2024 and 22.9% for fiscal year 2023.

The increase in operating margin is primarily due to the benefits of higher volume and pricing which more than offset increased material costs.

The increase in operating income and margin for the year is primarily due to the benefits of higher volume, including added volume from the acquisition of assets from BD, and pricing, which were partially offset by increased compensation, mostly due to commissions, and increased costs caused by inflation.

The AST segment’s operating income increased $10.7 million to $439.7 million in fiscal year 2024, as compared to $429.0 million in fiscal year 2023.

The AST segment's operating marg ins were 46.9% f or fiscal year 2023 and 48.1% for fiscal year 2022.

The increase in segment operating income is primarily due to increased volume.

Operating margins declined as higher labor and energy costs more than offset the benefit of increased volume.

The Life Sciences business segment’s operating income decreased $6.0 million to $210.2 million in fiscal year 2023, as compared to $216.2 million in fiscal year 2022.

The segment’s operating margins w ere 39.2% for fiscal year 2023 and 41.2% for fiscal year 2022.

The decreases in segment operating income and operating margin were primarily due to a reduction in productivity as well as supply chain and inflationary cost increases partially offset by the benefits of increases in pricing and volume.

The Dental business segment's operating income increased $5.1 million to $89.5 million in fiscal year 2023 as compared to $84.4 million in fiscal year 2022.

The increase in operating income is primarily due to favorable pricing.

The AST segment's operating margins were 46.1% for fiscal year 2024 and 46.9% for fiscal year 2023.

The decrease in operating margin is primarily due to higher labor costs and decreased productivity, which exceeded the benefits of favorable pricing.

The Life Sciences business segment’s operating income increased $11.1 million to $221.3 million in fiscal year 2024, as compared to $210.2 million in fiscal year 2023.

The increase in operating income was primarily due to favorable pricing and volume, which were partially offset by increased costs caused by inflation.

The segment’s operating margins were 38.7% for fiscal year 2024 and 39.2% for fiscal year 2023.

The Dental segment's increase in operating income is primarily due to an increase in pricing.

Operating margins declined as a reduction in productivity and increased supply chain and labor costs more than offset the benefit of pricing.

The decrease in operating margin was primarily due to increased costs due to inflation, which exceeded the benefits of favorable pricing.

LIQUIDITY AND CAPITAL RESOURCES

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Net cash used in investing activities (887,361) (383,330)

Net cash (used in) provided by financing activities (498,718) 115,830

Net cash used in financing activities

(85,186) (498,718)

Debt-to-total capital ratio 33.7 % 33.6 %

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Net Cash Provided By Operating Activities – The net cash provided by our operating activities was $973.3 million for the year ended March 31, 2024, compared to $756.9 million for the year ended March 31, 2023.

Net cash provided by operating activities increased in fiscal 2023 by 10.5% over fiscal 2022, largely due to lower costs associated with the acquisition and integration of Cantel in the fiscal 2023 period, partially offset by higher working capital, particularly inventory and accounts receivable.

Net cash provided by operating

activities increased in fiscal 2024 by 28.6% over fiscal 2023, and resulted from the increase in operating activity and lower use of cash for working capital requirements.

Net Cash Used In Investing Activities – The net cash used in our investing activities was $887.4 million for the year ended March 31, 2024, compared to $383.3 million for the year ended March 31, 2023.

The following discussion summarizes the significant changes in our investing cash flows for the years ended March 31, 2024 and 2023:

• Purchases of property, plant, equipment, and intangibles, net – Capital expenditures totaled $362.0 million and $287.6 million for fiscal 2023 and 2022, respectively.

The fiscal 2023 increase was primarily due to additional expenditures in our AST segment.

• Proceeds from the sale of property, plant, equipment and intangibles – During fis cal 2023 and 2022 we recei ved $14.6 million and $1.7 million, respectively, for proceeds from the sale of property, plant, equipment and intangibles.

The fiscal 2023 increase was primarily due to the sale of a facility previously used by the Dental segment.

• Proceeds from the sale of business – During fiscal 2023 and 2022, we received $6.6 million and $169.7 million, respectively, for proceeds from the sale of certain non-core businesses.

• Purchases of property, plant, equipment, and intangibles, net – Capital expenditures was comparable in fiscal 2024 and 2023, totaling $360.3 million and $362.0 million for fiscal 2024 and 2023, respectively.

• Proceeds from the sale of property, plant, equipment and intangibles – During fiscal 2024 and 2023 we received $7.4 million and $14.6 million, respectively, for proceeds from the sale of property, plant, equipment and intangibles.

The fiscal 2024 proceeds primarily related to the sale of a facility previously used by the AST segment.

The fiscal 2023 proceeds were primarily from the sale of a facility previously used by the Dental segment.

• Proceeds from the sale of business – During fiscal 2024, we received proceeds of $9.5 million from the release of funds held in escrow related to the sale of the Renal Care business during fiscal 2022.

During 2023, we sold the remaining component of the Animal Healthcare business for $6.6 million.

For more information, refer to Note 3 to our consolidated financial statements titled, "Business Acquisitions and Divestitures."

• Proceeds from the sale of investments – During fiscal 2024, we received $3.9 million in proceeds from the sale of one of our equity investments.

For more information refer to Note 19 to our consolidated financial statements, titled "Fair Value Measurements."

• Investment in convertible notes – During fiscal 2024, we invested $1.5 million in convertible notes related to funding the development of intellectual property.

• Acquisition of businesses, net of cash acquired – During fiscal 2024 and 2023, we used $546.3 million and $42.6 million, respectively, for acquisitions.

For more information on these acquisitions refer to Note 3 to our consolidated financial statements titled, "Business Acquisitions and Divestitures."

Net Cash Provided By/Used In Financing Activities – Net cash used in financing activities was $498.7 million for the year ended March 31, 2023, compared to net cash provided by financing activities of $115.8 million for the year ended March 31, 2022.

Net Cash Used In Financing Activities – Net cash used in financing activities was $85.2 million for the year ended March 31, 2024, compared to net cash used in financing activities of $498.7 million for the year ended March 31, 2023.

The following discussion summarizes the significant changes in our financing cash flows for the years ended March 31, 2024 and 2023:

• Proceeds from issuance of senior notes – During fiscal 2022, we received $1,350.0 million in proceeds from the issuance of our Senior Public Notes.

For more information on our Senior Public Notes, refer to Note 6 to our consolidated financial statements titled, "Debt."

• Proceeds from term loan – During fiscal 2022, we borrowed $650.0 million under our Delayed Draw Term Loan.

For more information on our term loans, refer to Note 6 to our consolidated financial statements titled, "Debt."

• Payments on term loans – During fiscal 2023, we repaid $156.9 million of our Term Loans.

During fiscal 2022, we repaid $345.0 million of our Term Loans.

• Payments on term loans – During fiscal 2024 and 2023, we repaid $60.0 million and $156.9 million of our term loans, respectively.

For more information on our term loans, refer to Note 8 to our consolidated financial statements titled, "Debt."

• Payments on long-term obligations – During fiscal 2023, we repaid $91.0 million of Private Placement Senior Notes.

For more information on our Private Placement Senior Notes, refer to Note 6 to our consolidated financial statements titled, "Debt." During fiscal 2022, we repaid $721.3 million of Cantel's outstanding debt in connection with the acquisition.

For more information on Cantel's debt, refer to Note 2 to our consolidated financial statements titled, "Business Acquisitions and Divestitures."

• Payments on convertible debt obligations – During fiscal 2022, we paid $371.4 million to settle obligations associated with Cantel's convertible debt assumed at the time of acquisition.

For more information on Cantel's debt, refer to Note 6 to our consolidated financial statements titled, "Debt."

• Proceeds/Payments under credit facilities, net – Net proceeds received under credit facilities totaled $241.7 million for fiscal 2023, compared to net payments under credit facilities of $190.2 million for fiscal 2022.

• Payments on Private Placement Senior Notes – During fiscal 2023, we repaid $91.0 million of private placement debt.

For more information on our Private Placement Senior Notes, refer to Note 8 to our consolidated financial statements titled, "Debt."

• Proceeds under credit facilities, net – Net proceeds received under credit facilities totaled $181.5 million and $241.7 million for fiscal 2024 and 2023, respectively.

At the end of fiscal 2024, $484.5 million of debt was outstanding under our bank credit facility, compared to $301.7 million of debt outstanding under this facility at the end of fiscal 2023.

We provide additional information about our bank credit facility in Note 8 to our consolidated financial statements titled, "Debt."

• Deferred financing fees and debt issuance costs – During fiscal 2022, we paid $17.5 million for financing fees and debt issuance costs primarily related to our Senior Public Notes and Delayed Draw Term Loan.

For more information on our debt, refer to Note 6 to our consolidated financial statements titled, "Debt."

• Repurchases of ordinary shares – During fiscal 2023, we obtained 79,169 of our ordinary shares in connection with share-based compensation award programs in the aggregate amount of $13.5 million.

During fiscal 2023, we also purchased 1,563,983 of our ordinary shares in the aggregate amount of $295.0 million through our share repurchase program.

Due to the uncertainty surrounding the COVID-19 pandemic, share repurchases were suspended on April 9, 2020.

The suspension was lifted effective February 10, 2022, enabling the Company to resume stock repurchases pursuant to the prior authorizations.

From February 14, 2022, through March 31, 2022, we repurchased 108,368 of our ordinary shares for the aggregate amount of $25.0 million pursuant to the authorizations.

We also obtained 244,395 of our ordinary shares in the aggregate amount of $30.8 million in connection with share-based compensation award programs.

• Acquisition related deferred or contingent consideration – During fiscal 2024 and 2023, we paid $6.2 million and $1.5 million in acquisition related deferred and contingent consideration, respectively.

The fiscal 2024 increase is primarily related to the payout of contingent consideration from a prior acquisition in the amount of $5.0 million.

• Repurchases of ordinary shares – During fiscal 2024 and 2023, we obtained 76,645 and 79,169, respectively, of our ordinary shares in connection with share-based compensation award programs in the aggregate amount of $11.8 million and $13.5 million, respectively.

During fiscal 2024, we did not purchase any ordinary shares through our share repurchase program.

During fiscal 2023, we purchased 1,563,983 of our ordinary shares through our share repurchase program in the aggregate amount of $295.0 million.

We provide additional information about our share repurchases in Note 15 to our consolidated financial statements titled, "Repurchases of Ordinary Shares."

• Acquisition related deferred or contingent consideration – During fiscal 2023, we paid $1.5 million in acquisition related deferred and contingent consideration.

During fiscal 2022, we paid $32.7 million in acquisition related deferred and contingent consideration, the majority of which was associated with a pre-acquisition arrangement related to an acquisition made by Cantel prior to our purchase of the company.

For more information, refer to Note 2 to our consolidated financial statements titled, "Business Acquisitions and Divestitures."

• Cash dividends paid to ordinary shareholders – During fiscal 2024, we paid cash dividends totaling $200.6 million or $2.03 per outstanding share.

During fiscal 2023, we paid cash dividends totaling $183.5 million or $1.84 per outstanding share.

• Transactions with noncontrolling interest holders – During fiscal 2023, we paid $0.8 million in distributions to noncontrolling interest holders.

During fiscal 2022, we received contributions from noncontrolling interest hold ers of $3.7 million and paid $1.0 million in distributions to noncontrolling interest holders.

• Transactions with noncontrolling interest holders – During fiscal 2024 and 2023, we paid $1.6 million and $0.8 million, respectively, in distributions to noncontrolling interest holders.

During fiscal 2024, we also received $3.0 million in contributions from noncontrolling interest holders.

• Stock option and other equity transactions, net – We generally receive cash for issuing shares upon the exercise of options under our employee stock option program.

During fiscal 2023 and fiscal 2022, we received cash procee ds totaling $1.8 million and $10.1 million, respectively, under these programs.

During fiscal 2024 and fiscal 2023, we received cash proceeds totaling $10.5 million and $1.8 million, respectively, under these programs.

Cash Flow Measures.

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Free cash flow was $620.3 million in fiscal 2024, compared to $409.6 million in fiscal 2023 (see subsection above titled "Non-GAAP Financial Measures" for additional information and related reconciliation of cash flows from operations to free cash flow).

The fiscal 2023 increase in free cash flow was primarily due to lower costs associated with the acquisition and integration of Cantel, partially offset by higher working capital, particularly inventory and accounts receivable, as well as increased capital spending.

The fiscal 2024 increase in free cash flow was driven by cash flows from operations as capital spending in fiscal 2024 was comparable to fiscal 2023.

Our debt-to-total capital ratio was 33.7% at March 31, 2024 and 33.6% at March 31, 2023.

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Our sources of funding from credit as of March 31, 2024 are summarized below:

• On March 19, 2021, STERIS plc ("the Company"), STERIS Corporation, STERIS Limited (“Limited”), and STERIS Irish FinCo Unlimited Company ("FinCo", "STERIS Irish FinCo"), each as a borrower and guarantor, entered into a credit agreement with various financial institutions as lenders, and JPMorgan Chase Bank, N.A., as administrative agent (the “Revolving Credit Agreement”) providing for a $1,250.0 million revolving credit facility (the “Revolver”), which replaced a prior revolving credit agreement.

• On March 19, 2021, the Company, STERIS Corporation, STERIS Limited (“Limited”), and STERIS Irish FinCo Unlimited Company ("FinCo", "STERIS Irish FinCo"), each as a borrower and guarantor, entered into a credit agreement with various financial institutions as lenders, and JPMorgan Chase Bank, N.A., as administrative agent (the “Revolving Credit Agreement”) providing for a $1,250.0 million revolving credit facility (the “Revolver”), which replaced a prior revolving credit agreement.

• The Revolver provides for revolving credit borrowings, swing line borrowings and letters of credit, with sublimits for swing line borrowings and letters of credit.

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Dollars or in specified alternative currencies.

In connection with the cessation of British Pound Sterling LIBOR and Swiss Franc LIBOR as of December 31, 2021, JPMorgan Chase Bank, N.A.

as administrative agent, pursuant to authority contained in the Revolver, amended the Revolver on January 1, 2022 to make Benchmark Replacement Conforming Changes (as defined in the Revolver).

The amendment concerns technical, administrative or operational changes related to borrowings in British Pounds Sterling and Swiss Francs.

• On March 19, 2021, the Company, STERIS Corporation, Limited, and FinCo, each as a borrower and guarantor, entered into a term loan agreement with various financial institutions as lenders, and JPMorgan Chase Bank, N.A., as administrative agent (the “Term Loan Agreement”) providing for a $550.0 million term loan facility (the “Term Loan”), which replaced an existing term loan agreement, dated as of November 18, 2020 (the “Existing Term Loan Agreement”).

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For the period beginning from the fifth full fiscal quarter ended after the Term Loan Closing Date to and including the twelfth full fiscal quarter ended after the Term Loan Closing Date, quarterly principal payments, each in the amount of 1.25% of the original principal amount of the Term Loan, are due on the last business day of each fiscal quarter.

For the period beginning from the thirteenth full fiscal quarter ended after the Term Loan Closing Date through the maturity of the loan, quarterly principal payments, each in the amount of 1.875% of the original principal amount of the Term Loan, are due on the last business day of each fiscal quarter.

For the period beginning from the thirteenth full fiscal quarter ended after the Term Loan Closing Date through the maturity of the loan, quarterly

principal payments, each in the amount of 1.875% of the original principal amount of the Term Loan, are due on the last business day of each fiscal quarter.

The remaining unpaid principal is due and payable on the maturity date.

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The Applicable Margin is determined based on the Debt Rating of STERIS, as defined in the Term Loan Agreement.

Interest on Base Rate Advances is payable quarterly in arrears and interest on Term

Benchmark Advances is payable in arrears at the end of the relevant interest period therefor, but in no event less frequently than every three months.

Interest on Base Rate Advances is payable quarterly in arrears and interest on Term Benchmark Advances is payable in arrears at the end of the relevant interest period therefor, but in no event less frequently than every three months.

• Also on March 19, 2021, the Company, STERIS Corporation, Limited, and FinCo, each as a borrower and guarantor, entered into a delayed draw term loan agreement with various financial institutions as lenders, and JPMorgan Chase Bank, N.A., as administrative agent (the “Delayed Draw Term Loan Agreement”) providing for a delayed draw term loan facility of up to $750.0 million (the “Delayed Draw Term Loan”) in connection with STERIS’s acquisition of Cantel.

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The above descriptions reflect those amendments.

• On April 1, 2021, STERIS Irish FinCo Unlimited Company ("FinCo," "STERIS Irish FinCo," the "Issuer") completed an offering of $1,350.0 million in aggregate principal amount, of its senior notes in two separate tranches:

• On April 1, 2021, FinCo (the "Issuer") completed an offering of $1,350.0 million in aggregate principal amount, of its senior notes in two separate tranches:

(i) $675.0 million aggregate principal amount of the Issuer’s 2.70% Senior Notes due 2031 (the “2031 Notes”) and (ii) $675.0 million aggregate principal amount of the Issuer’s 3.750% Senior Notes due 2051 (the “2051 Notes” and, together with the 2031 Notes, the “Senior Public Notes”).

The Senior Public Notes were issued pursuant to an Indenture, dated as of April 1, 2021 (the “Base Indenture”), among FinCo, STERIS plc, STERIS Corporation and STERIS Limited (the “Guarantors”) and U.S.

The Senior Public Notes were issued pursuant to an Indenture, dated as of April 1, 2021 (the “Base Indenture”), among FinCo, the Company, STERIS Corporation and Limited (the “Guarantors”) and U.S.

Bank National Association as trustee (the “Trustee”), as supplemented by the First Supplemental Indenture, dated as of April 1, 2021, among FinCo, the Guarantors and the Trustee (the “Supplemental Indenture” and, together with the Base Indenture, the “Indenture”).

Each of the Guarantors guaranteed the Senior Public Notes jointly and severally on a senior unsecured basis (the “Guarantees”).

Each of the Guarantors guaranteed the Senior Public Notes jointly and severally on a senior unsecured basis.

The 2031 Notes will mature on March 15, 2031 and the 2051 Notes will mature on March 15, 2051.

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Dollar Value at March 31, 2024

$80,000 Senior notes at 3.35% 2012 Private Placement December 2024 80,000

$25,000 Senior notes at 3.55% 2012 Private Placement December 2027 25,000

$125,000 Senior notes at 3.45% 2015 Private Placement May 2025 125,000

$125,000 Senior notes at 3.55% 2015 Private Placement May 2027 125,000

$100,000 Senior notes at 3.70% 2015 Private Placement May 2030 100,000

$50,000 Senior notes at 3.93% 2017 Private Placement February 2027 50,000

€60,000 Senior notes at 1.86% 2017 Private Placement February 2027 65,254

$45,000 Senior notes at 4.03% 2017 Private Placement February 2029 45,000

€20,000 Senior notes at 2.04% 2017 Private Placement February 2029 21,752

£45,000 Senior notes at 3.04% 2017 Private Placement February 2029 55,579

€19,000 Senior notes at 2.30% 2017 Private Placement February 2032 20,664

£30,000 Senior notes at 3.17% 2017 Private Placement February 2032 37,053

$80,000 Senior notes at 3.35% 2012 Private Placement

December 2024 80,000

$25,000 Senior notes at 3.55% 2012 Private Placement

December 2027 25,000

$125,000 Senior notes at 3.45% 2015 Private Placement

May 2025 125,000

$125,000 Senior notes at 3.55% 2015 Private Placement

May 2027 125,000

$100,000 Senior notes at 3.70% 2015 Private Placement

May 2030 100,000

$50,000 Senior notes at 3.93% 2017 Private Placement

February 2027 50,000

€60,000 Senior notes at 1.86% 2017 Private Placement

February 2027 64,708

$45,000 Senior notes at 4.03% 2017 Private Placement

February 2029 45,000

€20,000 Senior notes at 2.04% 2017 Private Placement

February 2029 21,569

£45,000 Senior notes at 3.04% 2017 Private Placement

February 2029 56,799

€19,000 Senior notes at 2.30% 2017 Private Placement

February 2032 20,491

£30,000 Senior notes at 3.17% 2017 Private Placement

February 2032 37,866

Total Senior Notes $ 751,433

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The agreement governing the notes contains leverage and interest coverage covenants.

• The private placement note purchase agreements specify increases to the coupon interest rates while the ratio of Consolidated Total Debt to Consolidated EBITDA, as defined in the note purchase agreements, exceeds certain thresholds.

Beginning September 1, 2021, and through March 31, 2023, the coupon rates on the 2012 private placement notes were increased by 0.50%.

• On March 19, 2021, STERIS Corporation as issuer, and the Company, Limited and FinCo, as guarantors, entered into (1) a First Amendment to Amended and Restated Note Purchase Agreement dated March 5, 2019 (which had amended and restated certain note purchase agreements originally dated December 4, 2012) per the 2012 and 2013 senior notes (the “2012 Amendment”), and (2) a First Amendment to Amended and Restated Note Purchase Agreement dated March 5, 2019 (which had amended and restated certain note purchase agreements originally dated March 31, 2015) for the 2015 senior notes (the “2015 Amendment”).

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We use cash provided by operating activities and our cash and cash equivalent balances to fund capital expenditures.

In fiscal 2024, we plan to continue to invest in facility expansions, particularly within the Healthcare and Applied Sterilization Technologies segments and in ongoing maintenance for existing facilities.

In fiscal 2025, we plan to continue to invest in facility expansions, particularly within the Healthcare and AST segments and in ongoing maintenance for existing facilities.

MATERIAL FUTURE CASH OBLIGATIONS AND COMMERCIAL COMMITMENTS

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Commercial commitments include standby letters of credit, letters of credit required as security under our self-insured risk retention policies, and other potential cash outflows resulting from events that require us to fulfill commitments.

Due to the announced sale of the Dental segment, Dental is classified as a discontinued operation.

As such, obligations included below do not include the Dental segment.

Payments due by March 31,

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Benefit payments under other post-retirement benefits plans 994 890 804 712 2,906 6,306

Expected contributions to defined benefit plans 3,955 1,992 — — — 5,947

Total Material Future Cash Obligations $ 372,090 $ 744,372 $ 638,294 $ 169,374 $ 1,739,240 $ 3,663,370

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SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION

STERIS plc ("Parent") and its wholly-owned subsidiaries, STERIS Limited and STERIS Corporation (collectively "Guarantors" and each a "Guarantor"), each have provided guarantees of the obligations of STERIS Irish FinCo Unlimited Company ("FinCo", "STERIS Irish FinCo"), a wholly-owned subsidiary issuer, under Senior Public Notes issued by STERIS Irish FinCo on April 1, 2021 and of certain other obligations relating to the Senior Public Notes.

STERIS plc ("Parent") and its wholly-owned subsidiaries, Limited and STERIS Corporation (collectively "Guarantors" and each a "Guarantor"), each have provided guarantees of the obligations of FinCo, a wholly-owned subsidiary issuer, under Senior Public Notes issued by FinCo on April 1, 2021 and of certain other obligations relating to the Senior Public Notes.

The Senior Public Notes are guaranteed, jointly and severally, on a senior unsecured basis.

The Senior Public Notes and the related guarantees are senior unsecured obligations of STERIS Irish FinCo and the Guarantors, respectively, and are equal in priority with all other unsecured and unsubordinated indebtedness of the Issuer and the Guarantors, respectively, from time to time outstanding, including, as applicable, under the Private Placement Senior Notes, borrowings under the Revolving Credit Facility, the Term Loan and the Delayed Draw Term Loan.

The Senior Public Notes and the related guarantees are senior unsecured obligations of FinCo and the Guarantors, respectively, and are equal in priority with all other

unsecured and unsubordinated indebtedness of the Issuer and the Guarantors, respectively, from time to time outstanding, including, as applicable, under the Private Placement Senior Notes, borrowings under the Revolving Credit Facility, the Term Loan and the Delayed Draw Term Loan.

All of the liabilities of non-guarantor direct and indirect subsidiaries of STERIS, other than STERIS Irish FinCo, STERIS Limited and STERIS Corporation, including any claims of trade creditors, are effectively senior to the Senior Public Notes.

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The obligations of each Guarantor under its guarantee are expressly limited to the maximum amount that such Guarantor could guarantee without such guarantee constituting a fraudulent conveyance.

Each Guarantor that makes a payment under its guarantee will be entitled upon payment in full of all guaranteed obligations under the indenture to a contribution from each

Guarantor in an amount equal to such other Guarantor’s pro rata portion of such payment based on the respective net assets of all the Guarantors at the time of such payment determined in accordance with GAAP.

Each Guarantor that makes a payment under its guarantee will be entitled upon payment in full of all guaranteed obligations under the indenture to a contribution from each Guarantor in an amount equal to such other Guarantor’s pro rata portion of such payment based on the respective net assets of all the Guarantors at the time of such payment determined in accordance with U.S.

The following tables present summarized results of operations for the year ended March 31, 2024 and summarized balance sheet information at March 31, 2024 and 2023 for the obligor group of the Senior Public Notes.

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Total non-current liabilities $ 3,846,708 $ 3,813,838

Intercompany balances and transactions between the obligor group have been eliminated, and amounts due from, amounts due to, and transactions with non-issuer and non-guarantor subsidiaries have been presented separately.

Intercompany transactions arise from internal financing and trade activities.

Credit Ratings

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Credit Ratings (1)

(1) Effective May 18, 2023

(1) Effective April 18, 2024

Each of the credit rating agencies reviews its rating periodically and there is no guarantee our current credit ratings will remain the same.

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At March 31, 2024, assets related to costs to fulfill a contract were not material to our consolidated financial statements.

Allowance for Credit Losses.

We maintain an allowance for uncollectible accounts receivable for estimated losses in the collection of amounts owed by Customers.

We estimate the allowance based on analyzing a number of factors, including amounts written off historically, Customer payment practices, and general economic conditions.

We also analyze significant Customer accounts on a regular basis and record a specific allowance when we become aware of a specific Customer’s inability to pay.

As a result, the related accounts receivable are reduced to an amount that we reasonably believe is collectible.

These analyses require judgment.

If the financial condition of our Customers worsens, or economic conditions change, we may be required to make changes to our allowance for credit losses.

Inventories and Reserves.

Inventories are stated at the lower of their cost and net realizable value determined by the first-in, first-out ("FIFO") cost method.

Inventories are stated at the lower of their cost and net realizable value determined by the first-in, first-out cost method.

Inventory costs include material, labor, and overhead.

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We record an allowance for estimated losses when the facts and circumstances indicate that particular inventories will not be usable.

market conditions vary from those projected, and our estimates prove to be inaccurate, we may be required to write-down inventory values and record an adjustment to Cost of revenues.

If future market conditions vary from those projected, and our estimates prove to be inaccurate, we may be required to write-down inventory values and record an adjustment to Cost of revenues.

Asset Impairment Losses.

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These valuations require us to make estimates and assumptions, especially with respect to intangible assets.

We generally amortize our intangible assets over their useful lives with the exception of indefinite lived intangible assets.

We generally amortize our intangible assets over their estimated useful lives with the exception of indefinite lived intangible assets.

We do not amortize goodwill, but we evaluate it annually for impairment.

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We believe such assumptions and estimates are also comparable to those that would be used by other marketplace participants.

In the second quarter of fiscal 2023, in connection with the preparation of our quarterly consolidated financial statements, we identified that the estimated fair value of the Dental segment was below the carrying value and recognized a non-cash goodwill impairment charge of $490.6 million.

For additional information regarding the goodwill impairment charge, refer to Note 3 to our consolidated financial statements titled, "Goodwill and Intangible Assets."

We evaluate indefinite lived intangible assets annually, or when evidence of potential impairment exists.

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Income Taxes.

Our provision for income taxes is based on our current period income, changes in deferred income tax assets and liabilities, income tax rates, changes in uncertain tax benefits, and tax planning opportunities available to us in the various jurisdictions in which we operate.

jurisdictions in which we operate.

Tax laws are complex and subject to different interpretations by the taxpayer and the respective governmental taxing authorities.

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We use our historical loss experience and actuarial methods to calculate the estimated liability.

This liability includes estimated amounts for both losses and incurred but not reported claims.

This liability includes estimated amounts for both known losses and incurred but not reported claims.

We review the assumptions used to calculate the estimated liability at least annually to evaluate the adequacy of the amount recorded.

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Estimated amounts receivable under the contracts are included in the "Prepaid expenses and other current assets" line, and the "Other assets" line of our Consolidated Balance Sheets.

Our accrual for self-insured risk retention as of March 31, 2023 and 2022 was $30.4 million and $26.1 million , respectively.

Our accrual for self-insured risk retention as of March 31, 2024 and 2023 was $30.7 million and $30.4 million , respectively and is included in Accrued expenses and other and Other liabilities in our Consolidated Balance Sheets.

We are also self-insured for employee medical claims.

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We have made estimates as to the likelihood of unfavorable outcomes and the amounts of such potential losses.

In our opinion, the ultimate outcome of these proceedings and claims is not anticipated to have a material adverse affect on our consolidated financial position, results of operations, or cash flows.

In our opinion, the ultimate outcome of these proceedings and claims is not anticipated to have a material adverse effect on our consolidated financial position, results of operations, or cash flows.

However, the ultimate outcome of proceedings, government investigations, and claims is unpredictable and actual results could be materially different from our estimates.

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Generally, net periodic benefit costs increase as the expected long-term rate of return on plan assets assumption decreases.

Holding all other assumptions constant, lowering the expected long-term rate of return on plan assets assumption for our funded defined benefit pension plans by 50 basis points would have increased the fiscal 2023 benefit costs by less than $0.1 million.

Holding all other assumptions constant, lowering the expected long-term rate of return on plan assets assumption for

our funded defined benefit pension plans by 50 basis points would have increased the fiscal 2024 benefit costs by less than $0.2 million.

We develop our discount rate assumptions by evaluating input from third-party professional advisers, taking into consideration the current yield on country specific investment grade long-term bonds which provide for similar cash flow streams as our projected benefit obligations.

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Note 11 to our consolidated financial statements titled, “Benefit Plans,” contains additional information about our pension and other post-retirement welfare benefits plans.

Share-Based Compensation.

We measure the estimated fair value for share-based compensation awards, including grants of employee stock options, at the grant date and recognize the related compensation expense over the period in which the share-based compensation vests.

We selected the Black-Scholes-Merton option pricing model as the most appropriate method for determining the estimated fair value of our share-based stock option compensation awards.

This model involves assumptions that are judgmental and affect share-based compensation expense.

Share-based compensation ex pense was $39.0 million in fiscal 2023, $57.7 million in fiscal 2022 and $26.0 million million in fiscal 2021.

Note 14 to our consolidated financial statements titled, “Share-Based Compensation,” contains additional information about our share-based compensation plans.

FORWARD-LOOKING STATEMENTS

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Forward-looking statements speak only as to the date the statement is made and may be identified by the use of forward-looking terms such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “projects,” “targets,” “forecasts,” “outlook,” “impact,” “potential,” “confidence,” “improve,” “optimistic,” “deliver,” “orders,” “backlog,” “comfortable,” “trend”, and “seeks,” or the negative of such terms or other variations on such terms or comparable terminology.

Many important factors could cause actual results to differ materially from those in the forward-looking statements including, without limitation, disruption of production or supplies, changes in market conditions, political events, pending or future claims or litigation, competitive factors, technology advances, actions of regulatory agencies, and changes in laws, government regulations, labeling or product approvals or the application or interpretation thereof.

Many important factors could cause actual results to differ materially from those in the forward-looking statements including, without limitation, statements related to the expected benefits of and timing of completion of the Restructuring Plan, disruption of production or supplies, changes in market conditions, political events, pending or future claims or litigation, competitive factors, technology advances, actions of regulatory agencies, and changes in laws, government regulations, labeling or product approvals or the application or interpretation thereof.

Many of these important factors are outside of STERIS’s control.

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Unless legally required, STERIS does not undertake to update or revise any forward-looking statements even if events make clear that any projected results, express or implied, will not be realized.

Other potential risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements include, without limitation, (a) the impact of the COVID-19 pandemic or similar public health crises on STERIS’s operations, supply chain, material and labor costs, performance, results, prospects, or value, (b) STERIS's ability to achieve the expected benefits regarding the accounting and tax treatments of the redomiciliation to Ireland (“Redomiciliation”), (c) operating costs, Customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, Customers, clients or suppliers) being greater than expected, (d) STERIS’s ability to successfully integrate the businesses of Cantel Medical into our existing businesses, including unknown or inestimable liabilities, impairments, or increases in expected integration costs or difficulties in connection with the integration of Cantel Medical, (e) uncertainties related to tax treatments under the TCJA and the IRA, (f) the possibility that Pillar Two Model Rules could increase tax uncertainty and adversely impact STERIS's provision for income taxes and effective tax rate and subject STERIS to additional income tax in jurisdictions who adopt Pillar Two Model Rules, (g) STERIS's ability to continue to qualify for benefits under certain income tax treaties in light of ratification of more strict income tax treaty rules (through the MLI) in many jurisdictions where STERIS has operations, (h) changes in tax laws or interpretations that could increase our consolidated tax liabilities, including changes in tax laws that would result in STERIS being treated as a domestic corporation for United States federal tax purposes, (i) the potential for increased pressure on pricing or costs that leads to erosion of profit margins, including as a result of inflation, (j) the possibility that market demand will not develop for new technologies, products or applications or services, or business initiatives will take longer, cost more or produce lower benefits than anticipated, (k) the possibility that application of or compliance with laws, court rulings, certifications, regulations, or regulatory actions, including without limitation any of the same relating to FDA, EPA or other regulatory authorities, government investigations, the outcome of any pending or threatened FDA, EPA or other regulatory warning notices, actions, requests, inspections or submissions, the outcome of any pending or threatened litigation brought by private parties, or other requirements or standards may delay, limit or prevent new product or service introductions, affect the production, supply and/or marketing of existing products or services, result in costs to STERIS that may not be covered by insurance, or otherwise affect STERIS’s performance, results, prospects or value, (l) the potential of international unrest, including the Russia-Ukraine military conflict, economic downturn or effects of currencies, tax assessments, tariffs and/or other trade barriers, adjustments or anticipated rates, raw material costs or availability, benefit or retirement plan costs, or other regulatory compliance costs, (m) the possibility of reduced demand, or reductions in the rate of growth in demand, for STERIS’s products and services, (n) the possibility of delays in receipt of orders, order cancellations, or delays in the manufacture or shipment of ordered products, due to supply chain issues or otherwise , or in the provision of services, (o) the possibility that anticipated growth, cost savings, new product acceptance, performance or approvals, or other results may not be achieved, or that transition, labor, competition, timing, execution, impairments, regulatory, governmental, or other issues or risks associated with STERIS’s businesses, industry or initiatives including, without limitation, those matters described in STERIS's various securities filings, may adversely impact STERIS’s performance, results, prospects or value, (p) the impact on STERIS and its operations, or tax liabilities, of Brexit or the exit of other member countries from the EU, and the Company’s ability to respond to such impacts, (q) the impact on STERIS and its operations of any legislation, regulations or orders, including but not limited to any new trade or tax legislation (including CAMT and excise tax on stock buybacks), regulations or orders, that may be implemented by the U.S.

administration or Congress, or of any responses thereto, (r) the possibility that anticipated financial results or benefits of recent acquisitions, including the acquisition of Cantel Medical and Key Surgical, or of STERIS’s restructuring efforts, or of recent divestitures, including anticipated revenue, productivity improvement, cost savings, growth synergies and other anticipated benefits, will not be realized or will be other than anticipated, (s) the increased level of STERIS’s indebtedness incurred in connection with the acquisition of Cantel Medical limiting financial flexibility or

increasing future borrowing costs, (t) rating agency actions or other occurrences that could affect STERIS’s existing debt or future ability to borrow funds at rates favorable to STERIS or at all, and (u) the effects of changes in credit availability and pricing, as well as the ability of STERIS’s Customers and suppliers to adequately access the credit markets, on favorable terms or at all, when needed.

Other potential risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements include, without limitation, (a) the ability to consummate the previously announced sale of STERIS’s Dental business segment (the “Transaction”) on the expected terms and within the anticipated time period, or at all, which is dependent on the satisfaction of certain closing conditions, some of which are outside of STERIS’s control, (b) STERIS’s ability to realize the expected benefits of the Transaction, including the earnout payment, (c) the risk that regulatory approvals that are required to complete the Transaction may not be received, may take longer than expected or may impose adverse conditions, (d) the impact of public health crises on STERIS’s operations, supply chain, material and labor costs, performance, results, prospects, or value, (e) STERIS's ability to achieve the expected benefits regarding the accounting and tax treatments of the redomiciliation to Ireland , (f) operating costs, Customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, Customers, clients or suppliers) being greater than expected, (g) STERIS’s ability to successfully integrate acquired businesses into its existing businesses, including unknown or inestimable liabilities, impairments, or increases in expected integration costs or difficulties in connection with the integration of such businesses, (h) uncertainties related to tax treatments under the TCJA and the IRA, (i) the possibility that Pillar Two Model Rules could increase tax uncertainty and adversely impact STERIS's provision for income taxes and effective tax rate and subject STERIS to additional income tax in jurisdictions who adopt Pillar Two Model Rules, (j) STERIS's ability to continue to qualify for benefits under certain income tax treaties in light of ratification of more strict income tax treaty rules (through the MLI) in many jurisdictions where STERIS has operations, (k) changes in tax laws or interpretations that could increase our consolidated tax liabilities, including changes in tax laws that would result in STERIS being treated as a domestic corporation for United States federal tax purposes, (l) the potential for increased pressure on pricing or costs that leads to erosion of profit margins, including as a result of inflation, (m) the possibility that market demand will not develop for new technologies, products or applications or services, or business initiatives will take longer, cost more or produce lower benefits than anticipated, (n) the possibility that application of or compliance with laws, court rulings, certifications, regulations, or regulatory actions, including without limitation any of the same relating to FDA, EPA or other regulatory authorities, government investigations, the outcome of any pending or threatened FDA, EPA or other regulatory warning notices, actions, requests, inspections or submissions, the outcome of any pending or threatened litigation brought by private parties, or other requirements or standards may delay, limit or prevent new product or service introductions, affect the production, supply and/or marketing of existing products or services, result in costs to STERIS that may not be covered by insurance, or otherwise affect STERIS’s performance, results, prospects or value, (o) the potential of international unrest, including the Russia-Ukraine or Israel-Hamas military conflicts, economic downturn or effects of currencies, tax assessments, tariffs and/or other trade barriers, adjustments or anticipated rates, raw material costs or availability, benefit or retirement plan costs, or other regulatory compliance costs, (p) the possibility of reduced demand, or reductions in the rate of growth in demand, for STERIS’s products and services, (q) the possibility of delays in receipt of orders, order cancellations, or delays in the manufacture or shipment of ordered products, due to supply chain issues or otherwise, or in the provision of services, (r) the possibility that anticipated growth, cost savings, new product acceptance, performance or approvals, or other results may not be achieved, or that transition, labor, competition, timing, execution, impairments, regulatory, governmental, or other issues or risks associated with STERIS’s businesses, industry or initiatives including, without limitation, those matters described in STERIS's various securities filings, may adversely impact STERIS’s performance, results, prospects or value, (s) the impact on STERIS and its operations, or tax liabilities, of Brexit or the exit of other member countries from the EU, and the Company’s ability to respond to such impacts, (t) the impact on STERIS and its operations of any legislation, regulations or orders, including but not limited to any new trade or tax legislation (including CAMT and excise tax on stock buybacks), regulations or orders, that may be implemented by the U.S.

administration or Congress, or of any responses thereto, (u) the possibility that anticipated financial results or benefits of recent acquisitions, of STERIS’s restructuring efforts, or of recent divestitures, including anticipated revenue, productivity improvement, cost savings, growth synergies and other anticipated benefits, will not be realized or will be other than anticipated, (v) the level of STERIS’s indebtedness limiting financial flexibility or increasing future borrowing costs,

(w) rating agency actions or other occurrences that could affect STERIS’s existing debt or future ability to borrow funds at rates favorable to STERIS or at all, (x) the effects of changes in credit availability and pricing, as well as the ability of STERIS’s Customers and suppliers to adequately access the credit markets, on favorable terms or at all, when needed, and (y) the possibility that our expectations about the pre-tax savings resulting from the Restructuring Plan, the number of positions eliminated pursuant to the Restructuring Plan and the costs, charges and cash expenditures associated with the Restructuring

Plan may not be realized on the timeline or timelines we expect, or at all.

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

What changed 10-K

Item 7. Management’s Discussion and Analysis