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Geographic and Segment Information | 12 Months Ended
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Dec. 31, 2021
Segment Reporting [Abstract] |
Geographic and Segment Information | Note 19. Geographic and Segment Information Segment Information We identify operating segments based on the way we manage, evaluate and internally report our business activities for purposes of allocating resources, developing and executing our strategy, and assessing performance. We have three reportable segments: Cardiopulmonary, Neuromodulation and Advanced Circulatory Support. Effective in the fourth quarter of 2021, LivaNova changed its reportable segments corresponding to changes in how the Company’s chief operating decision maker regularly reviews information, allocates resources and assesses performance. The segment financial information presented herein reflects these changes for all periods presented. The Company’s changes to its reportable segments are summarized as follows: •The Company’s Advanced Circulatory Support business is no longer assessed as part of the Company’s previously reported Cardiovascular reportable segment and is evaluated independently as its own reportable segment. •The Company’s Cardiopulmonary business is no longer assessed as part of the Company’s previously reported Cardiovascular reportable segment and is evaluated independently as its own reportable segment. •The Company’s Heart Valves business, which was disposed of on June 1, 2021, is now included within Other. Our Cardiopulmonary segment is engaged in the development, production and sale of cardiopulmonary products, including oxygenators, heart-lung machines, autotransfusion systems, perfusion tubing systems, cannulae and other related accessories. Our Neuromodulation segment generates its revenue from the design, development and marketing of devices that deliver neuromodulation therapy to treat DRE, DTD and OSA. Neuromodulation products include the VNS Therapy System, which consists of an implantable pulse generator, a lead that connects the generator to the vagus nerve, and other accessories. Our Advanced Circulatory Support segment is engaged in the development, production and sale of leading-edge temporary life support products. These products include cardiopulmonary and respiratory support solutions consisting of temporary life support controllers and product kits that can include a combination of pumps, oxygenators, and cannulae. “Other” includes the results of our Heart Valves business, which was disposed of on June 1, 2021, and corporate shared service expenses for finance, legal, human resources, information technology and corporate business development. Net sales of our reportable segments include revenues from the sale of products that each reportable segment develops and manufactures or distributes. We define segment income as operating income before merger and integration, restructuring and amortization of intangibles. We operate under three geographic regions: U.S., Europe, and Rest of World. The table below presents net sales by operating segment and geographic region (in thousands):
|  | Year Ended December 31,
|  | 2021 |  | 2020 |  | 2019
Cardiopulmonary |  |  |  |  |  |
United States |  | $ | 154,073 |  |  | $ | 132,543 |  |  | $ | 161,471 |
Europe |  | 134,562 |  |  | 122,062 |  |  | 135,632 |
Rest of World |  | 194,344 |  |  | 192,127 |  |  | 207,613 |
|  | 482,979 |  |  | 446,732 |  |  | 504,716 |
Neuromodulation |  |  |  |  |  |
United States |  | 358,476 |  |  | 282,509 |  |  | 335,332 |
Europe |  | 51,435 |  |  | 39,019 |  |  | 46,262 |
Rest of World |  | 46,261 |  |  | 32,916 |  |  | 42,953 |
|  | 456,172 |  |  | 354,444 |  |  | 424,547 |
Advanced Circulatory Support |  |  |  |  |  |
United States |  | 53,821 |  |  | 41,094 |  |  | 30,781 |
Europe |  | 1,120 |  |  | 1,027 |  |  | 741 |
Rest of World |  | 518 |  |  | 200 |  |  | 401 |
|  | 55,459 |  |  | 42,321 |  |  | 31,923 |
Other (1) |  |  |  |  |  |
United States |  | 4,929 |  |  | 12,488 |  |  | 18,900 |
Europe |  | 14,407 |  |  | 31,259 |  |  | 40,548 |
Rest of World |  | 21,419 |  |  | 46,997 |  |  | 63,536 |
|  | 40,755 |  |  | 90,744 |  |  | 122,984 |
Totals |  |  |  |  |  |
United States |  | 571,299 |  |  | 468,634 |  |  | 546,484 |
Europe (2) |  | 201,525 |  |  | 193,367 |  |  | 223,183 |
Rest of World |  | 262,541 |  |  | 272,240 |  |  | 314,503 |
Total (3) (4) |  | $ | 1,035,365 |  |  | $ | 934,241 |  |  | $ | 1,084,170 |
(1)Other primarily includes the net sales of the Company’s Heart Valves business, which was disposed of on June 1, 2021. (2)Europe sales include those countries in which we have a direct sales presence, whereas European countries in which we sell through distributors are included in Rest of World. (3)Net sales to external customers includes $35.8 million, $29.7 million and $37.7 million in the United Kingdom, our country of domicile, for the years ended December 31, 2021, 2020 and 2019, respectively. (4)No single customer represented over 10% of our consolidated net sales. No country’s net sales exceeded 10% of our consolidated sales except for the U.S. The table below presents a reconciliation of segment income (loss) from continuing operations to consolidated loss from continuing operations before tax (in thousands):
|  | Year Ended December 31,
|  | 2021 |  | 2020 (1) |  | 2019 (1)
Cardiopulmonary (2) |  | $ | (6,429) |  |  | $ | 35,735 |  |  | $ | 50,533 |
Neuromodulation (3) |  | 169,499 |  |  | 109,273 |  |  | 83,333 |
Advanced Circulatory Support |  | 2,195 |  |  | (575) |  |  | 3,941 |
Other (4) (5) |  | (129,082) |  |  | (365,116) |  |  | (233,275) |
Total reportable segment income (loss) from continuing operations |  | 36,183 |  |  | (220,683) |  |  | (95,468) |
Other expenses (6) |  | 36,967 |  |  | 53,216 |  |  | 76,086 |
Operating loss from continuing operations |  | (784) |  |  | (273,899) |  |  | (171,554) |
Interest income |  | 435 |  |  | 131 |  |  | 803 |
Interest expense |  | (50,151) |  |  | (40,837) |  |  | (15,091) |
Loss on debt extinguishment |  | (60,238) |  |  | (1,407) |  |  | — |
Foreign exchange and other gains/(losses) |  | (13,734) |  |  | (32,010) |  |  | (2,536) |
Loss from continuing operations before tax |  | $ | (124,472) |  |  | $ | (348,022) |  |  | $ | (188,378) |
(1)Segment loss from continuing operations for the years ended December 31, 2020 and 2019 have been revised. For further details refer to “Note 1. Nature of Operations.” (2)Results for the years ended December 31, 2021, 2020 and 2019 include a Litigation provision, net of $38.1 million, $3.9 million and $(0.6) million, respectively. Refer to “Note 13. Commitments and Contingencies” for additional information. (3)Results for the year ended December 31, 2019 include the ImThera impairment of the IPR&D asset of $50.3 million. Refer to “Note 7. Goodwill and Intangible Assets” for additional information. (4)Results for the year ended December 31, 2020 include $180.2 million and $21.3 million in impairments of the Heart Valves disposal group and allocated goodwill, respectively. Refer to “Note 4. Divestiture of Heart Valve Business” for additional information. Additionally, the results for the year ended December 31, 2020 include a $42.2 million decommissioning provision at our Saluggia site. Refer to “Note 13. Commitments and Contingencies” for additional information. Results for the year ended December 31, 2019 include the Caisson impairments of goodwill and the IPR&D asset of $42.4 million and $89.0 million, respectively. Refer to “Note 7. Goodwill and Intangible Assets” for additional information. (5)Other includes the results of the Company’s Heart Valves business, which was disposed of on June 1, 2021, and corporate shared service expenses for finance, legal, human resources, information technology and corporate business development. (6)Other expenses consists of merger and integration expense, restructuring expense and amortization of intangible assets. Assets by reportable segment as of December 31, 2021 and 2020, was as follows (in thousands):
Total Assets |  | 2021 |  | 2020 (1)
Cardiopulmonary |  | $ | 921,481 |  |  | $ | 1,040,318 |
Neuromodulation |  | 646,394 |  |  | 673,579 |
Advanced Circulatory Support |  | 231,846 |  |  | 239,404 |
Other (2) |  | 401,230 |  |  | 446,660 |
|  | $ | 2,200,951 |  |  | $ | 2,399,961 |
(1)Total assets as of December 31, 2020 have been revised. For further details refer to “Note 1. Nature of Operations.” (2)Other includes corporate assets as of December 31, 2021 and 2020, and the assets of the Company’s Heart Valves business, which was disposed of on June 1, 2021 as of December 31, 2020. Capital expenditures by segment were as follows (in thousands):
|  | Year Ended December 31,
Capital Expenditures |  | 2021 |  | 2020 |  | 2019
Cardiopulmonary |  | $ | 14,824 |  |  | $ | 20,975 |  |  | $ | 16,302 |
Neuromodulation |  | 179 |  |  | 7,318 |  |  | 3,415 |
Advanced Circulatory Support |  | 1,326 |  |  | 733 |  |  | 540 |
Other (1) |  | 5,984 |  |  | 6,890 |  |  | 7,720 |
|  | $ | 22,313 |  |  | $ | 35,916 |  |  | $ | 27,977 |
(1)Other includes corporate capital expenditures as well as capital expenditures for the Company’s Heart Valves business, which was disposed of on June 1, 2021. Geographic Information Property, plant and equipment, net by geographic region as of December 31, 2021 and 2020, was as follows (in thousands):
Property, Plant and Equipment, Net |  | 2021 |  | 2020
United States |  | $ | 60,852 |  |  | $ | 64,553 |
Europe |  | 85,313 |  |  | 93,821 |
Rest of World |  | 3,901 |  |  | 5,431 |
|  | $ | 150,066 |  |  | $ | 163,805 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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