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Business segment information
 9 Months Ended
Sep. 30, 2023
Segment Reporting [Abstract]  
Business segment information

11. Business segment information

The Company has two reporting segments: Global Spine and Global Orthopedics. The primary metric used in managing the Company is adjusted earnings before interest, tax, depreciation, and amortization (“adjusted EBITDA,” a non-GAAP financial measure). Adjusted EBITDA represents earnings before interest income (expense), income taxes, depreciation, and amortization and excludes the impact of share-based compensation, gains and losses related to changes in foreign exchange rates, charges related to the SeaSpine merger and other strategic investments, acquisition-related fair value adjustments, legal judgments and settlements, charges related to initial compliance with regulations set forth by the European Union Medical Device Regulation, and certain other activities. Corporate activities are comprised of operating expenses not directly identifiable within the two reporting segments, such as human resources, finance, legal, and information technology functions. The table below presents adjusted EBITDA by reporting segment:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(Unaudited, U.S. Dollars, in thousands)

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Adjusted EBITDA by reporting segment

 

 

 

 

 

 

 

 

 

 

 

 

Global Spine

 

$

22,593

 

 

$

16,601

 

 

$

58,832

 

 

$

45,244

 

Global Orthopedics

 

 

477

 

 

 

2,648

 

 

 

386

 

 

 

2,624

 

Corporate

 

 

(9,549

)

 

 

(4,994

)

 

 

(32,574

)

 

 

(15,081

)

Consolidated adjusted EBITDA

 

$

13,521

 

 

$

14,255

 

 

$

26,644

 

 

$

32,787

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciling items:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

$

1,576

 

 

$

277

 

 

$

4,131

 

 

$

1,059

 

Depreciation and amortization

 

 

13,097

 

 

 

7,570

 

 

 

39,094

 

 

 

21,598

 

Share-based compensation expense

 

 

6,274

 

 

 

4,729

 

 

 

32,540

 

 

 

13,521

 

Foreign exchange impact

 

 

1,909

 

 

 

3,253

 

 

 

1,057

 

 

 

7,486

 

SeaSpine merger-related costs

 

 

5,416

 

 

 

—

 

 

 

34,362

 

 

 

—

 

Strategic investments

 

 

913

 

 

 

3,390

 

 

 

1,883

 

 

 

6,184

 

Acquisition-related fair value adjustments

 

 

7,122

 

 

 

419

 

 

 

26,907

 

 

 

(15,795

)

Legal judgments/settlements

 

 

3,851

 

 

 

125

 

 

 

5,611

 

 

 

466

 

Medical device regulation

 

 

1,840

 

 

 

2,590

 

 

 

7,519

 

 

 

6,883

 

Business interruption - COVID-19

 

 

—

 

 

 

1,215

 

 

 

—

 

 

 

1,874

 

All other

 

 

(92

)

 

 

59

 

 

 

170

 

 

 

230

 

Loss before income taxes

 

$

(28,385

)

 

$

(9,372

)

 

$

(126,630

)

 

$

(10,719

)

Geographical information

The table below presents net sales by geographic destination for each reporting segment and for the consolidated Company:

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

(Unaudited, U.S. Dollars, in thousands)

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Global Spine

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

$

145,764

 

 

$

81,414

 

 

$

432,581

 

 

$

244,379

 

International

 

 

8,588

 

 

 

4,772

 

 

 

28,953

 

 

 

15,244

 

Total Global Spine

 

 

154,352

 

 

 

86,186

 

 

 

461,534

 

 

 

259,623

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Global Orthopedics

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

 

7,482

 

 

 

6,588

 

 

 

21,341

 

 

 

18,818

 

International

 

 

22,172

 

 

 

21,222

 

 

 

63,351

 

 

 

60,043

 

Total Global Orthopedics

 

 

29,654

 

 

 

27,810

 

 

 

84,692

 

 

 

78,861

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

 

153,246

 

 

 

88,002

 

 

 

453,922

 

 

 

263,197

 

International

 

 

30,760

 

 

 

25,994

 

 

 

92,304

 

 

 

75,287

 

Net sales

 

$

184,006

 

 

$

113,996

 

 

$

546,226

 

 

$

338,484