Unaudited Quarterly Results

12 Months Ended

Dec. 31, 2017

Unaudited Quarterly Results [Abstract]

17 Unaudited Quarterly Results

The Company’s unaudited quarterly results are summarized below (in thousands, except per share data):

				First		Second		Third		Fourth
2017				Quarter		Quarter		Quarter		Quarter		Total
Net sales				$	497,969	$	558,250	$	565,584	$	687,275	$	2,309,078
Costs and operating expenses:
	Cost of sales				211,095		229,627		235,892		270,453		947,067
	Selling and administrative expenses				130,524		130,190		135,194		148,795		544,703
	Research and development expenses				30,752		32,937		33,782		35,122		132,593
	Litigation provisions				-		10,018		-		1,096		11,114
	Purchased intangibles amortization				1,729		1,693		1,682		1,639		6,743
	Acquired in-process research and development				5,000		-		-		-		5,000
		Total costs and operating expenses			379,100		404,465		406,550		457,105		1,647,220
			Operating income		118,869		153,785		159,034		230,170		661,858
Interest expense					(12,725)		(14,083)		(14,750)		(15,281)		(56,839)
Interest income					7,343		8,370		9,516		10,849		36,078
	Income before income taxes				113,487		148,072		153,800		225,738		641,097
Provision for income taxes					7,930		16,250		17,696		578,910		620,786
	Net income (loss)			$	105,557	$	131,822	$	136,104	$	(353,172)	$	20,311
Net income (loss) per basic common share					1.32		1.65		1.71		(4.44)		0.25
Weighted-average number of basic
	common shares				80,073		79,979		79,712		79,454		79,793
Net income (loss) per diluted common share					1.31		1.63		1.69		(4.44)		0.25
Weighted-average number of diluted
	common shares and equivalents				80,769		80,756		80,521		79,454		80,604

				First		Second		Third		Fourth
2016				Quarter		Quarter		Quarter		Quarter		Total
Net sales				$	475,246	$	536,560	$	526,830	$	628,787	$	2,167,423
Costs and operating expenses:
	Cost of sales				201,151		220,379		218,344		251,579		891,453
	Selling and administrative expenses				129,351		129,581		123,861		130,238		513,031
	Research and development expenses				29,438		32,578		30,418		32,753		125,187
	Litigation provisions				-		-		-		3,524		3,524
	Purchased intangibles amortization				2,644		2,411		2,476		2,358		9,889
		Total costs and operating expenses			362,584		384,949		375,099		420,452		1,543,084
			Operating income		112,662		151,611		151,731		208,335		624,339
Interest expense					(10,119)		(10,983)		(11,707)		(12,102)		(44,911)
Interest income					4,087		4,827		5,426		6,346		20,686
	Income before income taxes				106,630		145,455		145,450		202,579		600,114
Provision for income taxes					12,578		17,238		20,594		28,201		78,611
	Net income			$	94,052	$	128,217	$	124,856	$	174,378	$	521,503
Net income per basic common share					1.16		1.59		1.55		2.17		6.46
Weighted-average number of basic
	common shares				81,275		80,804		80,677		80,366		80,786
Net income per diluted common share					1.15		1.57		1.53		2.15		6.41
Weighted-average number of diluted
	common shares and equivalents				81,974		81,455		81,388		80,954		81,417

The Company typically experiences an increase in sales in the fourth quarter, as a result of purchasing habits for capital goods of customers that tend to exhaust their spending budgets by calendar year end. Selling and administrative expenses are typically higher after the first quarter in each year as the Company’s annual payroll merit increases take effect. Selling and administrative expenses will vary in the fourth quarter in relation to performance in the quarter and for the year. In the third quarter of 2017 and first quarter of 2016, the Company recorded $4 million and $7 million of stock compensation expenses, respectively, in selling and administrative expenses related to the modification of certain stock awards upon the retirement of senior executives.

In the first quarter of 2017, the Company recorded a $5 million charge related to acquired in-process research and development (see Note 2). In 2017 and in fourth quarter of 2016, the company recorded litigation provisions of $11 million and $4 million, respectively (see Note 10). In the fourth quarter of 2017, the Company recorded a $550 million income tax provision as a result of the 2017 Tax Act (see Note 9).