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Note 4 - Fair Value Measurements
 9 Months Ended
Dec. 31, 2024
Notes to Financial Statements  
Fair Value Disclosures [Text Block]

Note 4. Fair Value Measurements

 

Our financial instruments consist primarily of cash and cash equivalents, trade accounts receivable, obligations under trade accounts payable, and debt. Due to their short-term nature, the carrying values for cash and cash equivalents, trade accounts receivable, and trade accounts payable approximate fair value; they are classified within Level 1 of the fair value hierarchy. 

 

The financial instruments that subject us to the highest concentration of credit risk are cash and accounts receivable. We maintain relationships and cash deposits at multiple banking institutions across the world in an effort to diversify and reduce risk of loss. Concentration of credit risk with respect to accounts receivable is limited to customers to whom we make significant sales. No customers accounted for more than 10% of total trade receivables as of December 31, 2024.

 

On April 5, 2024, we entered into separate, privately negotiated purchase agreements with a limited number of holders of our 1.375% convertible senior notes due  August 15, 2025 (the "Notes"), through which we repurchased $75,000 in aggregate principal amount of the Notes. See Note 7. "Indebtedness" for further information. As of December 31, 2024, we had remaining outstanding $97,500 aggregate principal amount of the Notes. We estimate the fair value of the Notes using Level 2 inputs based on the last actively traded price or observable market input preceding the end of the reporting period. The fair value of the Notes is approximately correlated to our stock price.

 

The estimated fair value and carrying value of the Notes were as follows:

 

  

December 31, 2024

  

March 31, 2024

 
  

Carrying Value

  

Fair Value (Level 2)

  

Carrying Value

  

Fair Value (Level 2)

 

Notes

 $97,163  $94,819  $171,198  $163,013 

 

The carrying amounts of our term loan and revolving line of credit (together, the "Credit Facility") on the unaudited Condensed Consolidated Balance Sheets approximate fair value due to the variable interest rate pricing on the debt, with the balance bearing an interest rate approximating current market rates.

 

We expect to pay approximately $9,000 (at  December 31, 2024 exchange rates) for the GKE holdback in April 2025. We estimate the discounted fair value of consideration held back to be approximately $8,900 as of December 31, 2024 based on Level 3 inputs from the acquisition, including discount rate estimates. We adjust the estimated fair value at each reporting period through earnings.

 

During fiscal year 2023, we acquired substantially all of the assets and certain liabilities of Belyntic GmbH’s peptide purification business (“the Belyntic acquisition”). We are obligated to pay contingent consideration of up to $1,500 cash upon regulatory approval of certain patent applications. We estimate the fair value of the remaining contingent consideration is $675, using Level 3 inputs and a probability-weighted outcome analysis based on our expectations of patent approval, leveraging our historical experience and expert input. 

 

Amounts recognized or disclosed at fair value in the unaudited condensed consolidated financial statements on a nonrecurring basis include the initial recognition and disclosure of most assets and liabilities purchased in business acquisitions and any related measurement period adjustments. Additionally, assets such as property and equipment, operating lease assets, goodwill and other intangible assets are adjusted to fair value if determined to be impaired. Fair values of such assets and liabilities require measurement using Level 3 inputs. We recorded no impairments during the three and nine months ended December 31, 2024 or 2023. 

 

There were no transfers between the levels of the fair value hierarchy during the three and nine months ended December 31, 2024.