Integer Holdings Corporation Reports Second Quarter 2025 Results

~ Continued strong sales and profit growth in 2Q25 ~ ~ Raising 2025 full year adjusted operating income and EPS outlook midpoint ~ PLANO, Texas, July 24, 2025 (GLOBE NEWSWIRE) -- Integer Holdings Corporation (NYSE:ITGR) today announced results for the three months ended June 27, 2025. Second Quarter 2025 Highlights (compared to Second Quarter 2024, except as noted) Sales increased 11% to $476 million, with organic growth of 11%.GAAP operating income increased $5 million to $59 million, an increase of 9%. Non-GAAP adjusted operating income increased $10 million to $81 million, an increase of 15%.GAAP income from continuing operations increased $6 million to $37 million, an increase of 19%. Non-GAAP adjusted net income increased $10 million to $55 million, an increase of 23%.GAAP diluted EPS from continuing operations increased $0.16 to $1.04, an increase of 18%. Non-GAAP adjusted EPS increased $0.25 to $1.55, an increase of 19%.Adjusted EBITDA increased $9 million to $99 million, an increase of 10%.From the end of 2024, total debt increased $212 million to $1.202 billion and Non-GAAP net total debt increased $250 million to $1.204 billion, primarily to finance acquisitions and costs associated with the 2030 convertible note offering, resulting in a leverage ratio of 3.2 times adjusted EBITDA as of June 27, 2025. “Integer delivered another strong quarter of growth with sales up 11%, adjusted operating income up 15%, and adjusted EPS growth of 19% as we continue to execute our strategy,” said Joseph Dziedzic, Integer’s president and CEO. “We are raising our 2025 profit outlook midpoint. We now expect adjusted operating income growth of 12% to 16% and adjusted EPS growth of 18% to 23%." Discussion of Product Line Second Quarter 2025 Sales Cardio & Vascular sales increased 24% in the second quarter 2025 compared to the second quarter 2024, driven by new product ramps in electrophysiology, Precision Coating and VSi Parylene acquisitions, and strong customer demand in neurovascular.Cardiac Rhythm Management & Neuromodulation sales increased 2% in the second quarter 2025 compared to the second quarter 2024, driven by strong growth in emerging neuromodulation customers with PMA (pre-market approval) products, normalized cardiac rhythm management growth, and the final quarters of the planned decline of an early spinal cord stimulation neuromodulation finished implantable pulse generator (non-emerging) customer, announced in 2020.Other Markets sales decreased 38% in the second quarter 2025 compared to the second quarter 2024, primarily driven by the planned multi-year portable medical exit announced in 2022. 2025 Outlook(a) (dollars in millions, except per share amounts) GAAP Non-GAAP(b) As Reported Change from Prior Year Adjusted Change from Prior YearSales $1,850 to $1,876 8% to 9% N/A N/AOperating income $232 to $244 11% to 17% $319 to $331 12% to 16%EBITDA N/A N/A $402 to $418 11% to 16%Income from continuing operations $100 to $109 (17)% to (10)% $222 to $231 21% to 26%Diluted earnings per share $2.79 to $3.05 (20)% to (13)% $6.25 to $6.51 18% to 23%Cash flow from operating activities(c) $235 to $255 15% to 24% N/A N/A (a)Except as described below, further reconciliations by line item to the closest corresponding GAAP financial measure for adjusted operating income, adjusted EBITDA, adjusted net income and adjusted earnings per share (“EPS”), included in our “2025 Outlook” above, and adjusted total interest expense, adjusted effective tax rate and leverage ratio in “Supplemental Financial Information” below, are not available without unreasonable efforts on a forward-looking basis due to the high variability, complexity and visibility of the charges excluded from these non-GAAP financial measures. (b)Adjusted operating income for 2025 consists of GAAP operating income, excluding items such as amortization of intangible assets, restructuring and restructuring-related charges, and acquisition and integration costs, totaling approximately $87 million, pre-tax. Adjusted net income for 2025 consists of GAAP income from continuing operations, excluding items such as amortization of intangible assets, restructuring and restructuring-related charges, acquisition and integration costs, debt conversion inducement expense, and gain or loss on equity investments totaling approximately $134 million, pre-tax. The after-tax impact of these items is estimated to be approximately $122 million, or approximately $3.39 per diluted share. Adjusted EPS for 2025 consists of GAAP diluted EPS from continuing operations, excluding the after-tax impact of the Adjusted net income items noted above and the estimated dilution resulting from the potential conversion of our 2028 Convertible Notes expected to be offset by capped call option contracts, which is approximately $0.06 per diluted share. Adjusted EBITDA is expected to consist of adjusted net income, excluding items such as depreciation, interest, stock-based compensation and taxes totaling approximately $180 million to $187 million. (c)Prior year cash flow from operating activities included an immaterial amount related to discontinued operations. Supplemental Financial Information (dollars in millions)2025Outlook 2024ActualDepreciation and amortization$123 to $127 $107 Adjusted total interest expense(a)$40 to $42 $56 Stock-based compensation$23 to $26 $24 Restructuring, acquisition and other charges(b)$20 to $24 $22 Adjusted effective tax rate(c)18.5% to 19.5% 18.3%Leverage ratio(d)2.5x to 3.5x 2.6xCapital expenditures(e)$110 to $120 $105 Cash income tax payments$36 to $40 $36 (a) Adjusted total interest expense refers to our expected full-year GAAP interest expense, expected to range from $41 million to $43 million for 2025, adjusted to remove the full-year impact of charges associated with the accelerated write-off of debt discounts and deferred issuance costs (loss on extinguishment of debt) included in GAAP interest expense, if any. There were no adjustments to GAAP interest expense for 2024. (b) Restructuring, acquisition and other charges consists of restructuring and restructuring-related charges, acquisition and integration costs, other general expenses and incremental costs of complying with the new European Union medical device regulations. (c) Adjusted effective tax rate refers to our full-year GAAP effective tax rate, expected to range from 26.0% to 27.0% for 2025, adjusted to reflect the full-year impact of the items that are excluded in providing adjusted net income and certain other identified items. Adjusted effective tax rate of 18.3% for 2024 consists of GAAP effective tax rate of 18.0% adjusted to reflect the impact on the income tax provision related to Non-GAAP adjustments. (d) Please see “Notes Regarding Non-GAAP Financial Information” for additional information regarding leverage ratio. (e) Capital expenditures is calculated as cash used to acquire property, plant, and equipment (“PP&E”) less cash proceeds from the sale of PP&E. Summary Financial Results (dollars in thousands, except per share data) Three Months Ended Six Months Ended June 27,2025 June 28,2024 QTD Change June 27,2025 June 28,2024 YTD ChangeOperating income $59,338 $54,494 8.9% $108,890 $93,195 16.8%Income from continuing operations $37,009 $31,207 18.6% $14,544 $51,798 (71.9)%Diluted EPS from continuing operations $1.04 $0.88 18.2% $0.41 $1.47 (72.1)% EBITDA(a) $87,636 $81,383 7.7% $119,274 $145,879 (18.2)%Adjusted EBITDA(a) $98,951 $89,842 10.1% $190,460 $170,071 12.0%Adjusted operating income(a) $81,266 $70,825 14.7% $152,189 $133,020 14.4%Adjusted net income(a) $54,818 $44,683 22.7% $100,756 $83,351 20.9%Adjusted EPS(a) $1.55 $1.30 19.2% $2.85 $2.44 16.8% (a) EBITDA, adjusted EBITDA, Adjusted operating income, Adjusted net income, and Adjusted EPS are non-GAAP financial measures. Please see “Notes Regarding Non-GAAP Financial Information” for additional information regarding our use of non-GAAP financial measures. Refer to Tables A, B and C at the end of this release for reconciliations of adjusted amounts to the closest corresponding GAAP financial measures. Summary Product Line Results(dollars in thousands) Three Months Ended June 27,2025 June 28,2024 QTD Change Organic Change(a)Product Line Sales Cardio & Vascular $286,855 $231,418 24.0% 17.6%Cardiac Rhythm Management & Neuromodulation 171,998 168,061 2.3% 2.3%Other Markets 17,641 28,407 (37.9)% (1.8)%Total Sales $476,494 $427,886 11.4% 10.8% Six Months Ended June 27,2025 June 28,2024 YTD Change Organic Change(a)Product Line Sales Cardio & Vascular $545,726 $453,269 20.4% 14.3%Cardiac Rhythm Management & Neuromodulation 332,343 324,992 2.3% 2.3%Other Markets 35,817 57,421 (37.6)% (12.8)%Total Sales $913,886 $835,682 9.4% 8.6% (a) Organic sales change is a non-GAAP financial measure. Please see “Notes Regarding Non-GAAP Financial Information” for additional information regarding our use of non-GAAP financial measures and refer to Table D at the end of this release for a reconciliation of these amounts to the closest corresponding GAAP financial measures. Conference Call Information The Company will host a conference call on Thursday, July 24, 2025, at 8 a.m. CT / 9 a.m. ET to discuss these results. The scheduled conference call will be webcast live and is accessible through our website at investor.integer.net or by dialing (800) 715-9871 (U.S.) or (646) 307-1963 (outside U.S.) and the conference ID is 3120125. The call will be archived on the Company’s website. An earnings call slide presentation containing supplemental information about the Company’s results will be posted to our website at investor.integer.net prior to the conference call and will be referenced during the conference call. From time to time, the Company posts information that may be of interest to investors on its website. To automatically receive Integer financial news by email, please visit investor.integer.net and subscribe to email alerts. About Integer® Integer Holdings Corporation (NYSE: ITGR) is one of the largest medical device contract development and manufacturing organizations (CDMO) in the world, serving the cardiac rhythm management, neuromodulation, and cardio and vascular markets. As a strategic partner of choice to medical device companies and OEMs, Integer is committed to enhancing the lives of patients worldwide by providing innovative, high-quality products and solutions. The company's brands include Greatbatch Medical® and Lake Region Medical®. Additional information is available at www.integer.net. Investor Relations: Kristen Stewart551.337.3973kristen.stewart@integer.net Notes Regarding Non-GAAP Financial Information In addition to our results reported in accordance with generally accepted accounting principles in the United States of America (“GAAP”), we provide adjusted net income, adjusted EPS, earnings before interest, taxes, depreciation and amortization (“EBITDA”), adjusted EBITDA, adjusted operating income, and organic sales change. Unless otherwise indicated, all financial metrics presented reflect continuing operations only. Adjusted net income and adjusted EPS consist of GAAP income (loss) from continuing operations and diluted EPS from continuing operations, respectively, adjusted for the following to the extent occurring during the period: (i) amortization of intangible assets, (ii) certain legal expenses; (iii) restructuring and restructuring-related charges; (iv) acquisition and integration related costs; (v) other general expenses; (vi) (gain) loss on equity investments; (vii) extinguishment of debt charges, (viii) debt conversion inducement expense; (ix) European Union medical device regulation incremental charges; (x) inventory step-up amortization; (xi) unusual, or infrequently occurring items; (xii) the income tax provision (benefit) related to these adjustments and (xiii) certain tax items that are outside the normal tax provision for the period. Adjusted EPS is calculated by dividing adjusted net income by adjusted weighted average shares. The weighted average shares used to calculate diluted EPS in accordance with GAAP includes dilution, when applicable, resulting from the potential conversion of our 2028 Convertible Notes and 2030 Convertible Notes (collectively, the “Convertible Notes”). In connection with the issuance of the Convertible Notes, we entered into capped call contracts which are expected to reduce the potential dilution on our common stock in connection with any conversion of the Convertible Notes, subject to a cap. Adjusted weighted average shares consists of GAAP weighted average shares used to calculate diluted EPS, including, when applicable, dilutive common stock equivalents that were excluded from weighted average shares used to calculate diluted EPS as their inclusion would be anti-dilutive and excluding, when applicable, dilution resulting from the potential conversion of our Convertible Notes expected to be offset by the capped call contracts. EBITDA is calculated by adding back interest expense, provision for income taxes, depreciation expense, and amortization expense from intangible assets and financing leases, to income (loss) from continuing operations, which is the most directly comparable GAAP financial measure. Adjusted EBITDA consists of EBITDA plus adding back stock-based compensation and the same adjustments as listed above except for items (i), (vii), (xii) and (xiii). Adjusted operating income consists of operating income adjusted for the same items listed above except for items (vi), (vii), (viii), (xii) and (xiii). Organic sales change is reported sales growth adjusted to remove the impact of foreign currency, the contribution of acquisitions and the strategic exit of the Portable Medical market. To calculate the impact of foreign currency on sales growth rates, we convert any sale made in a foreign currency by converting current period sales into prior period sales using the exchange rate in effect at that time and then compare the two, negating any effect foreign currency had on our transactional revenue. For contribution of acquisitions, we exclude the impact on the growth rate attributable to the contribution of acquisitions in all periods where there were no comparable sales. For the strategic exit of the Portable Medical market, we exclude the impact on the growth rate attributable to Portable Medical sales for all periods presented. We believe that the presentation of adjusted net income, adjusted EPS, EBITDA, adjusted EBITDA, adjusted operating income, and organic sales change, provides important supplemental information to management and investors seeking to understand the financial and business trends relating to our financial condition and results of operations. In addition to the performance measures identified above, we believe that net total debt and leverage ratio provide meaningful measures of liquidity and a useful basis for assessing our ability to fund our activities, including the financing of acquisitions and debt repayments. Net total debt is calculated as total principal amount of debt outstanding less cash and cash equivalents. We calculate leverage ratio as net total debt divided by adjusted EBITDA for the trailing 4 quarters. Forward-Looking Statements Some of the statements contained in this press release are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements relating to: our 2025 outlook, including with respect to future sales, cash flows from operating activities, expenses, and profitability; 2025 outlook for depreciation and amortization, interest expense, stock based compensation, restructuring, acquisition and other charges, tax rate, leverage ratio, capital expenditures and cash tax payments; and other events, conditions or developments that will or may occur in the future. You can identify forward-looking statements by terminology such as “outlook,” “projected,” “may,” “will,” “should,” “could,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “project,” or “continue” or variations or the negative of these terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially from those stated or implied by these forward-looking statements. In evaluating these statements and our prospects, you should carefully consider the factors set forth below. Although it is not possible to create a comprehensive list of all factors that may cause actual results to differ from the results expressed or implied by our forward-looking statements or that may affect our future results, some of these factors and other risks and uncertainties that arise from time to time are described in Item 1A, “Risk Factors” of our Annual Report on Form 10-K and in our other periodic filings with the SEC and include the following: operational risks, such as our dependence upon a limited number of customers; pricing pressures and contractual pricing restraints we face from customers; our reliance on third-party suppliers for raw materials, key products and subcomponents; interruptions in our manufacturing operations; uncertainty surrounding macroeconomic and geopolitical factors in the U.S. and globally; our ability to attract, train and retain a sufficient number of qualified associates to maintain and grow our business; the potential for harm to our reputation and competitive advantage caused by quality problems related to our products; our dependence upon our information technology systems and our ability to prevent cyber-attacks and other failures; global climate change and the emphasis on Environmental, Social and Governance matters by various stakeholders; our dependence upon our senior management team and key technical personnel; and consolidation in the healthcare industry resulting in greater competition;strategic risks, such as the intense competition we face and our ability to successfully market our products; our ability to respond to changes in technology; our ability to develop new products and expand into new geographic and product markets; and our ability to successfully identify, make and integrate acquisitions to expand and develop our business in accordance with expectations;financial and indebtedness risks, such as our ability to accurately forecast future performance based on operating results that often fluctuate; our significant amount of outstanding indebtedness and our ability to remain in compliance with financial and other covenants under the credit agreement governing our Senior Secured Credit Facilities; economic and credit market uncertainties that could interrupt our access to capital markets, borrowings or financial transactions; the conditional conversion features of our Convertible Notes adversely impacting our liquidity; the conversion of our Convertible Notes diluting ownership interests of existing holders of our common stock; the counterparty risk associated with our capped call transactions; the financial and market risks related to our international sales and operations; our complex international tax profile; and our ability to realize the full value of our intangible assets;legal and compliance risks, such as regulatory issues resulting from product complaints, recalls or regulatory audits; the potential of becoming subject to product liability or intellectual property claims; our ability to protect our intellectual property and proprietary rights; our ability to comply with customer-driven policies and third-party standards or certification requirements; our ability to obtain and/or retain necessary licenses from third parties for new technologies; our ability and the cost to comply with environmental regulations; legal and regulatory risks from our international operations; the fact that the healthcare industry is highly regulated and subject to various regulatory changes; and our business being indirectly subject to healthcare industry cost containment measures that could result in reduced sales of our products; andother risks and uncertainties that arise from time to time. Unless otherwise noted, the forward-looking information in this press release is representative as of today only. Except as may be required by law, we assume no obligation to update forward-looking statements in this press release whether to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results, financial conditions or prospects, or otherwise. Condensed Consolidated Balance Sheets - Unaudited(in thousands) June 27,2025 December 31, 2024ASSETS Current assets: Cash and cash equivalents $23,135 $46,543 Accounts receivable, net 302,262 245,269 Inventories 266,437 247,126 Contract assets 103,224 103,772 Prepaid expenses and other current assets 42,372 28,409 Total current assets 737,430 671,119 Property, plant and equipment, net 511,784 465,798 Goodwill 1,100,371 1,017,729 Other intangible assets, net 854,545 778,286 Deferred income taxes 8,517 8,309 Operating lease assets 100,912 86,082 Financing lease assets 31,717 27,689 Other long-term assets 25,659 22,959 Total assets $3,370,935 $3,077,971 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Current portion of long-term debt $— $10,000 Accounts payable 117,367 101,498 Operating lease liabilities 8,922 7,352 Accrued expenses and other current liabilities 89,741 108,323 Total current liabilities 216,030 227,173 Long-term debt 1,202,495 980,153 Deferred income taxes 114,735 124,608 Operating lease liabilities 83,897 77,702 Financing lease liabilities 25,796 23,760 Other long-term liabilities 24,445 25,360 Total liabilities 1,667,398 1,458,756 Stockholders’ equity: Common stock 35 34 Additional paid-in capital 760,741 741,977 Treasury stock (26,858) — Retained earnings 905,769 891,247 Accumulated other comprehensive income (loss) 63,850 (14,043)Total stockholders’ equity 1,703,537 1,619,215 Total liabilities and stockholders’ equity $3,370,935 $3,077,971 Condensed Consolidated Statements of Operations - Unaudited(in thousands, except per share data) Three Months Ended Six Months Ended June 27,2025 June 28,2024 June 27,2025 June 28,2024Sales $476,494 $427,886 $913,886 $835,682 Cost of sales 347,342 310,509 664,416 610,032 Gross profit 129,152 117,377 249,470 225,650 Operating expenses: Selling, general and administrative 52,923 46,479 104,083 92,914 Research, development and engineering 14,240 15,614 28,441 30,888 Restructuring and other charges 2,651 790 8,056 8,653 Total operating expenses 69,814 62,883 140,580 132,455 Operating income 59,338 54,494 108,890 93,195 Interest expense 9,754 14,572 24,559 28,563 (Gain) loss on equity investments 8 7 (173) (1,129)Other (income) loss, net 3,980 (127) 51,907 880 Income from continuing operations before taxes 45,596 40,042 32,597 64,881 Provision for income taxes 8,587 8,835 18,053 13,083 Income from continuing operations 37,009 31,207 14,544 51,798 Income (loss) from discontinued operations, net of tax — 39 (22) (44)Net income $37,009 $31,246 $14,522 $51,754 Basic earnings per share: Income from continuing operations $1.06 $0.93 $0.42 $1.54 Income (loss) from discontinued operations $— $— $— $— Basic earnings per share $1.06 $0.93 $0.42 $1.54 Diluted earnings per share: Income from continuing operations $1.04 $0.88 $0.41 $1.47 Income (loss) from discontinued operations $— $— $— $— Diluted earnings per share $1.04 $0.88 $0.41 $1.47 Weighted average shares outstanding: Basic 35,035 33,600 34,488 33,540 Diluted 35,713 35,529 35,830 35,264 Condensed Consolidated Statements of Cash Flows - Unaudited (a)(in thousands) Six Months Ended June 27,2025 June 28,2024Cash flows from operating activities: Net income $14,522 $51,754 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 62,118 53,410 Debt related charges included in interest expense 3,627 1,869 Debt conversion inducement expense 46,681 — Inventory step-up amortization — 1,056 Stock-based compensation 12,536 12,614 Non-cash lease expense 5,000 4,622 Non-cash gains on equity investments (173) (1,129)Contingent consideration fair value adjustment (309) — Other non-cash losses 3,143 1,408 Deferred income taxes 3,942 — Gain on sale of discontinued operations (46) — Changes in operating assets and liabilities, net of acquisitions: Accounts receivable (41,014) 3,465 Inventories (14,509) (27,235)Prepaid expenses and other assets 71 (744)Contract assets 1,800 (11,666)Accounts payable 11,561 7,069 Accrued expenses and other liabilities (23,312) (16,155)Income taxes payable (10,500) (9,864) Net cash provided by operating activities 75,138 70,474 Cash flows from investing activities: Acquisition of property, plant and equipment (44,219) (60,252)Acquisitions, net (170,872) (138,544)Other investing activities 97 — Net cash used in investing activities (214,994) (198,796)Cash flows from financing activities: Principal payments of long-term debt (657,693) — Proceeds from issuance of convertible notes, net of discount 977,500 — Proceeds from revolving credit facility 257,000 208,500 Payments of revolving credit facility (373,000) (51,500)Purchase of capped calls (71,000) — Payment of debt issuance costs (1,266) — Proceeds from the exercise of stock options 3,644 742 Tax withholdings related to net share settlements of restricted stock unit awards (16,707) (10,625)Principal payments on finance leases (2,596) (8,956)Other financing activities 107 607 Net cash provided by financing activities 115,989 138,768 Effect of foreign currency exchange rates on cash and cash equivalents 459 17 Net increase (decrease) in cash and cash equivalents (23,408) 10,463 Cash and cash equivalents, beginning of period 46,543 23,674 Cash and cash equivalents, end of period $23,135 $34,137 (a) The Condensed Consolidated Statements of Cash Flows - Unaudited includes cash flows related to discontinued operations. Table A: Adjusted Net Income and Diluted EPS from Continuing Operations Reconciliations(in thousands, except per share amounts) Three Months Ended June 27, 2025 June 28, 2024 Pre-Tax Net of Tax PerDilutedShare(a) Pre-Tax Net of Tax PerDilutedShare(a)Income from continuing operations (GAAP) $45,596 $37,009 $1.04 $40,042 $31,207 $0.88 Adjustments(b): Amortization of intangible assets 16,120 12,978 0.37 13,609 10,951 0.32 Certain legal expenses (SG&A)(c) 9 6 — 354 279 0.01 Restructuring and restructuring-related charges(d) 2,575 2,049 0.06 1,935 1,515 0.04 Acquisition and integration costs(e) 2,007 1,596 0.04 1,056 834 0.02 Other general expenses(f) 7 7 — (1,173) (817) (0.02)Loss on equity investments(g) 8 6 — 7 5 — Loss on extinguishment of debt(h) 130 103 — — — — Medical device regulations(i) 262 207 0.01 278 220 0.01 Other adjustments(j) 948 750 0.02 272 215 0.01 Tax adjustments(k) — 107 — — 274 0.01 Impact of capped call option contracts(l) — — — — — 0.03 Adjusted net income (non-GAAP) $67,662 $54,818 $1.55 $56,380 $44,683 $1.30 Weighted average shares for diluted EPS (GAAP) 35,713 35,529 Less: Convertible Notes capped call options impact (240) (1,050) Adjusted weighted average shares (non-GAAP) 35,473 34,479 Six Months Ended June 27, 2025 June 28, 2024 Pre-Tax Net of Tax PerDilutedShare(a) Pre-Tax Net of Tax PerDilutedShare(a)Income from continuing operations (GAAP) $32,597 $14,544 $0.41 $64,881 $51,798 $1.47 Adjustments(b): Amortization of intangible assets 30,971 24,927 0.71 26,960 21,696 0.63 Certain legal expenses (SG&A)(c) 111 87 — 354 279 0.01 Restructuring and restructuring-related charges(d) 3,677 2,938 0.08 3,822 3,102 0.09 Acquisition and integration costs(e) 6,749 5,347 0.15 7,391 5,858 0.17 Other general expenses(f) 6 6 — (1,055) (729) (0.02)Gain on equity investments(g) (173) (137) — (1,129) (892) (0.03)Loss on extinguishment of debt(h) 867 685 0.02 — — — Debt conversion inducement expense(m) 46,681 46,681 1.32 — — — Medical device regulations(i) 512 404 0.01 553 437 0.01 Other adjustments(j) 1,273 1,006 0.03 744 588 0.02 Inventory step-up amortization (COS)(n) — — — 1,056 834 0.02 Tax adjustments(k) — 4,268 0.12 — 380 0.01 Impact of capped call option contracts(l) — — — — — 0.04 Adjusted net income (Non-GAAP) $123,271 $100,756 $2.85 $103,577 $83,351 $2.44 Weighted average shares for diluted EPS (GAAP) 35,830 35,264 Less: Convertible Notes capped call options impact (515) (1,039) Adjusted weighted average shares (non-GAAP) 35,315 34,225 (a) Income from continuing operations (GAAP) per diluted share amounts are calculated in accordance with GAAP using weighted average shares for diluted EPS. The per share amounts for the adjustments in the table above and adjusted net income are calculated using adjusted weighted average shares. (b) The difference between pre-tax and net of tax amounts is the estimated tax impact related to the respective adjustment. Net of tax amounts are computed using a 21% U.S. tax rate, and the statutory tax rates applicable in foreign tax jurisdictions, as adjusted for the existence of net operating losses (“NOLs”). Expenses that are not deductible for tax purposes (i.e. permanent tax differences) are added back at 100% (c) Certain legal expenses associated with non-ordinary course legal matters. (d) We initiate discrete restructuring programs primarily to realign resources to better serve our customers and markets, improve operational efficiency and capabilities, and lower operating costs or improve profitability. Depending on the program, restructuring charges may include termination benefits, contract termination, facility closure and other exit and disposal costs. Restructuring-related expenses are directly related to the program and may include retention bonuses, accelerated depreciation, consulting expense and costs to transfer manufacturing operations among our facilities. (e) Acquisition and integration costs are incremental costs that are directly related to a business or asset acquisition. These costs may include, among other things, professional, consulting and other fees, system integration costs, and fair value adjustments relating to contingent consideration. (f) Other general expenses are discrete transactions occurring sporadically and affect period-over-period comparisons. The expenses for the 2025 and 2024 periods include gains and losses in connection with the disposal of property, plant and equipment. In addition, during the second quarter of 2024, we recorded $1.2 million of loss recoveries relating to property damage which occurred in the fourth quarter of 2023 at one of our manufacturing facilities. (g) Amounts reflect our share of equity method investee (gains) losses including unrealized appreciation/depreciation of the underlying interests of the investee. (h) Loss on extinguishment of debt consists of accelerated write-offs of unamortized deferred debt issuance costs and discounts, which are included in interest expense. (i) The charges represent incremental costs of complying with the new European Union medical device regulations for previously registered products and primarily include charges for contractors supporting the project and other direct third-party expenses. (j) Amount primarily relates to costs associated with certain formal strategic projects. Strategic projects primarily involve system reconfiguration to support our manufacturing excellence operational strategic imperative and investments in certain technology and platform development to align our capabilities to meet customer needs. (k) Tax adjustments predominately relate to changes to uncertain tax benefits and associated interest. During the first quarter of 2025 we wrote off a deferred tax asset of $4.1 million related to a portion of the unamortized original issue discount due to the partial exchange of the 2028 Convertible Notes. (l) Represents the per share amount attributable to the reduction in dilution upon assumed exercise of the capped call option contracts. (m) Debt conversion inducement expense relates to the partial exchange of the 2028 Convertible Notes and is recorded within Other (income) loss, net in the Condensed Consolidated Statements of Operations. (n) The accounting associated with our acquisitions requires us to record inventory at its fair value, which is sometimes greater than the previous book value of inventory. The increase in inventory value is amortized to cost of sales over the period that the related inventory is sold. We exclude inventory step-up amortization from our non-GAAP financial measures because it is a non-cash expense that we do not believe is indicative of our ongoing operating results. Please see “Notes Regarding Non-GAAP Financial Information” for additional information regarding our use of non-GAAP financial measures. Table B: Adjusted Operating Income Reconciliations (in thousands) Three Months Ended Six Months Ended June 27,2025 June 28,2024 June 27,2025 June 28,2024Operating income (GAAP) $59,338 $54,494 $108,890 $93,195 Adjustments: Amortization of intangible assets 16,120 13,609 30,971 26,960 Certain legal expenses 9 354 111 354 Restructuring and restructuring-related charges 2,575 1,935 3,677 3,822 Acquisition and integration costs 2,007 1,056 6,749 7,391 Other general expenses 7 (1,173) 6 (1,055)Medical device regulations 262 278 512 553 Other adjustments 948 272 1,273 744 Inventory step-up amortization — — — 1,056 Adjusted operating income (non-GAAP) $81,266 $70,825 $152,189 $133,020 Table C: EBITDA Reconciliations(in thousands) Three Months Ended Six Months Ended June 27,2025 June 28,2024 June 27,2025 June 28,2024Income from continuing operations (GAAP) $37,009 $31,207 $14,544 $51,798 Interest expense 9,754 14,572 24,559 28,563 Provision for income taxes 8,587 8,835 18,053 13,083 Depreciation(a) 15,040 12,585 29,026 24,399 Amortization of intangible assets and financing leases 17,246 14,184 33,092 28,036 EBITDA (non-GAAP) 87,636 81,383 119,274 145,879 Stock-based compensation(b) 5,499 5,730 12,350 12,456 Certain legal expenses 9 354 111 354 Restructuring and restructuring-related charges 2,575 1,935 3,677 3,822 Acquisition and integration costs 2,007 1,056 6,749 7,391 Other general expenses 7 (1,173) 6 (1,055)(Gain) loss on equity investments 8 7 (173) (1,129)Debt conversion inducement expense — — 46,681 — Medical device regulations 262 278 512 553 Other adjustments 948 272 1,273 744 Inventory step-up amortization — — — 1,056 Adjusted EBITDA (non-GAAP) $98,951 $89,842 $190,460 $170,071 (a) Excludes amounts included in Restructuring and restructuring-related charges. (b) Excludes amounts included in Restructuring and restructuring-related charges and Other adjustments. Table D: Organic Sales Change Reconciliation (% Change) GAAP Reported Growth Impact of Foreign Currency(a) Impact of Strategic Exits and Acquisitions(a) Non-GAAP Organic ChangeQTD Change (2Q 2025 vs. 2Q 2024) Product Line Cardio & Vascular 24.0% 0.3% 6.1% 17.6%Cardiac Rhythm Management & Neuromodulation 2.3% —% —% 2.3%Other Markets (37.9)% —% (36.1)% (1.8)%Total Sales 11.4% 0.2% 0.4% 10.8% YTD Change (6M 2025 vs. 6M 2024) Product Line Cardio & Vascular 20.4% 0.1% 6.0% 14.3%Cardiac Rhythm Management & Neuromodulation 2.3% —% —% 2.3%Other Markets (37.6)% —% (24.8)% (12.8)%Total Sales 9.4% —% 0.8% 8.6% (a) Sales growth has been adjusted to exclude the impact of foreign currency exchange rate fluctuations, when applicable, and strategic exits and acquisitions. Table E: Net Total Debt Reconciliation (in thousands) June 27,2025 December 31,2024Total debt $1,202,495 $990,153Add: Debt discounts and deferred issuance costs included in Total debt 24,806 10,841Total principal amount of debt outstanding 1,227,301 1,000,994Less: Cash and cash equivalents 23,135 46,543Net Total Debt (Non-GAAP) $1,204,166 $954,451

Integer Holdings Corporation Reports Second Quarter 2025 Results

FAQ

Why Bullish?

How important is it?

Why Short Term?

Related Companies

Related News