England and Wales
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98-1203539
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(State or other jurisdiction of
incorporation or organization)
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(IRS Employer Identification No.)
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Rutherford House Stephensons Way Chaddesden, Derby, England
(Address of principal executive offices)
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DE21 6LY
(Zip Code)
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44 1332 387100
(Registrant’s telephone number
including area code)
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Title of each class
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Name of Exchange on Which Registered
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Ordinary Shares, 10 pence par value
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New York Stock Exchange
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Page
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Part I
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Item 1
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Item 1A
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Item 1B
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Item 2
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Item 3
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Item 4
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Part II
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Item 5
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Item 6
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Item 7
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Item 7A
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Item 8
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Item 9
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Item 9A
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Item 9B
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Part III
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Item 10
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Item 11
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Item 12
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Item 13
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Item 14
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Part IV
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Item 15
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Item 16
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ITEM 1.
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BUSINESS
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Name
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Age
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Position
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Kathleen L. Bardwell
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62
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Senior Vice President and Chief Compliance Officer
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Karen L. Burton
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50
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Vice President, Controller and Chief Accounting Officer
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Daniel A. Carestio
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45
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Senior Vice President, Sterilization and Disinfection
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Dr. Adrian Coward
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48
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Senior Vice President, Healthcare Specialty Services
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Michiel de Zwaan
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46
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Vice President and Chief Human Resources Officer
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Gulam A. Khan
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51
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Senior Vice President, Procedural Solutions
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Sudhir K. Pahwa
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65
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Senior Vice President, Infection Prevention Technologies
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Walter M Rosebrough, Jr.
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64
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President and Chief Executive Officer
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Renato G. Tamaro
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49
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Vice President and Corporate Treasurer
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Michael J. Tokich
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49
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Senior Vice President and Chief Financial Officer
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J. Adam Zangerle
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51
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Vice President, General Counsel, and Secretary
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ITEM 1A.
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RISK FACTORS
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Risk or uncertainty
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Discussion
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Economic conditions and financial market access
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Changes in economic climate may adversely affect us.
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Adverse economic cycles or conditions and Customer, regulatory or government response to those cycles or conditions, could affect our results of operations. The onset of these cycles or conditions may not be foreseeable and there can be no assurance when they will begin to improve after they occur. There also can be no assurance as to the strength or length of any recovery from a business downturn or recession. Credit and liquidity problems may make it difficult for some businesses to access credit markets and obtain financing and may cause some businesses to curtail spending to conserve cash in anticipation of persistent business slowdowns and liquidity needs. If our Customers have difficulty financing their purchases due to tight credit markets or related factors or because of other operational or utilization problems they may be experiencing or otherwise decide to curtail their purchases, our business could be adversely affected. Our exposure to bad debt losses could also increase if Customers are unable to pay for products previously ordered and delivered.
Many of our Customers are governmental entities or other entities that rely on government healthcare systems or government funding. If government funding for healthcare becomes limited or restricted in countries in which we operate, our Customers may be unable to pay their obligations on a timely basis or to make payment in full and it may become necessary to increase reserves. In addition, there can be no assurance that there will not be an increase in collection difficulties. Prospectively, additional adverse effects resulting from these conditions may include decreased healthcare utilization, further pricing pressure on our products and services, and/or weaker overall demand for our products and services, particularly capital products.
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Our acquisition activity and ability to grow organically may be adversely affected if we are unable to continue to access the financial markets.
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Our recent acquisitions have been financed largely through cash on hand and borrowings under our bank credit facilities. Future acquisitions or other capital requirements will necessitate additional cash. To the extent our existing sources of cash are insufficient to fund these or other future activities, we may need to raise additional funds through new or expanded borrowing arrangements or equity. There can be no assurance that we will be able to obtain additional funds beyond those available under existing bank credit facilities on terms favorable to us, or at all, or that such facilities can be replaced when they terminate.
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Risk or uncertainty
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Discussion
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Healthcare laws and reimbursement
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Changes in healthcare laws or government and other third-party payor reimbursement levels to healthcare providers, or failure to meet healthcare reimbursement or other requirements, might negatively impact our business.
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We sell many of our products and services to hospitals and other healthcare providers and pharmaceutical manufacturers. Many of these Customers are subject to or supported by government programs or receive reimbursement for services from third-party payors, such as government programs, including Medicare and Medicaid, private insurance plans, and managed care programs. Reimbursement systems vary significantly by country. However, government-managed healthcare systems control reimbursement for healthcare services in many countries. Public budgetary constraints may significantly impact the ability of hospitals, pharmaceutical manufacturers, and other Customers supported by such systems to purchase our products. Government or other third-party payors may deny or change coverage, reduce their current levels of reimbursement for healthcare services, or otherwise implement measures to regulate pricing or contain costs. In addition, our costs may increase more rapidly than reimbursement levels or permissible pricing increases or we may not satisfy the standards or requirements for reimbursement.
Among other provisions, the U.S. Patient Protection and Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act, imposed an excise tax on medical devices manufactured or offered for sale in the United States. Early in 2018, U.S. Congress enacted legislation that extended the suspension of the excise tax, which suspension had been in place in since the beginning of calendar year 2016, for 2018 and 2019. Should the U.S. Congress take no further action with regard to this tax we will begin to incur excise tax in the fourth quarter of fiscal 2020. We incurred $5.8 million in medical device excise taxes for fiscal 2016. In addition, we have been required to commit significant resources to “Sunshine Act” compliance. Various additional health care reform proposals have emerged at the federal and state level, and we are unable to predict which, if any, of those proposals will be enacted.
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We may be adversely affected by product liability claims or other legal actions or regulatory or compliance matters.
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We face an inherent business risk of exposure to product liability claims and other legal and regulatory actions. A significant increase in the number, severity, amount, or scope of these claims and actions may, as described above with respect to recalls and restrictions, result in substantial costs and harm our reputation or otherwise adversely affect product sales and our business. Product liability claims and other legal and regulatory actions may also distract management from other business responsibilities.
We are also subject to a variety of other types of claims, proceedings, investigations, and litigation initiated by government agencies or third parties and other potential risks and liabilities. These include compliance matters, product regulation or safety, taxes, employee benefit plans, employment discrimination, health and safety, environmental, antitrust, customs, import/export, government contract compliance, financial controls or reporting, intellectual property, allegations of misrepresentation, false claims or false statements, commercial claims, claims regarding promotion of our products and services, or other similar or different matters. Any such claims, proceedings, investigations or litigation, regardless of the merits, might result in substantial costs, restrictions on product use or sales, or otherwise injure our business.
Administratively or judicially imposed or agreed sanctions might include warning letters, fines, civil penalties, criminal penalties, loss of tax benefits, injunctions, product seizure, recalls, suspensions or restrictions, re-labeling, detention, and/or debarment. We also might be required to take actions such as payment of substantial amounts, or revision of financial statements, or to take, or be subject to, the following types of actions with respect to our products, services, or business: redesign, re-label, restrict, or recall products; cease manufacturing and selling products; seizure of product inventory; comply with a court injunction restricting or prohibiting further marketing and sale of products or services; comply with a consent decree, which could result in further regulatory constraints; dedication of significant internal and external resources and costs to respond to and comply with legal and regulatory issues and constraints; respond to claims, litigation, and other proceedings brought by Customers, users, governmental agencies, and others; disruption of product improvements and product launches; discontinuation of certain product lines or services; or other restrictions or limitations on product sales, use or operation, or other activities or business practices.
Some product replacements or substitutions may not be possible or may be prohibitively costly or time consuming. The impact of any legal, regulatory, or compliance claims, proceeding, investigation, or litigation, is difficult to predict.
We maintain product liability and other insurance with coverages believed to be adequate. However, product liability or other claims may exceed insurance coverage limits, fines, penalties and regulatory sanctions may not be covered by insurance, or insurance may not continue to be available or available on commercially reasonable terms. Additionally, our insurers might deny claim coverage for valid or other reasons or may become insolvent.
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Proposed legislation relating to the denial of U.S. federal or state governmental contracts to U.S. companies that redomicile abroad could adversely affect our business.
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Various U.S. federal and state legislative proposals that would deny governmental contracts to redomiciled companies may adversely affect us if adopted into law. We are unable to predict the likelihood that any such proposed legislation might become law, the nature of regulations that may be promulgated under any future legislative enactments, or the effect such enactments or increased regulatory scrutiny could have on our business.
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The U.S. Internal Revenue Service (the “IRS”) may not agree that we are a foreign corporation for U.S. federal tax purposes.
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Although we are incorporated under the laws of England and Wales and are a tax resident in the U.K. for U.K. tax purposes, the IRS may assert that we should be treated as a U.S. corporation (and, therefore, a U.S. tax resident) for U.S. federal tax purposes pursuant to Section 7874 of the Internal Revenue Code of 1986, as amended (the “Code” and such Section, “Section 7874”). For U.S. federal tax purposes, a corporation generally is considered to be a tax resident in the jurisdiction of its organization or incorporation. Because we are incorporated under the laws of England and Wales, we would generally be classified as a non-U.S. corporation (and, therefore, a non-U.S. tax resident) under these rules. Section 7874, however, provides an exception to this general rule under which a non-U.S. incorporated entity may, in certain circumstances (including a transaction pursuant to which a U.S. corporation is acquired by a non-U.S. corporation), be treated as a U.S. corporation for U.S. federal tax purposes.
If we were to be treated as a U.S. corporation for U.S. federal tax purposes, we could be subject to substantial additional U.S. tax liability. Additionally, if we were treated as a U.S. corporation for U.S. federal tax purposes, non-U.S. holders of STERIS ordinary shares would be subject to U.S. withholding tax on the gross amount of any dividends we paid to such shareholders. For U.K. tax purposes, we are expected, regardless of any application of Section 7874, to be treated as a U.K. tax resident. Consequently, if we are treated as a U.S. corporation for U.S. federal tax purposes under Section 7874, we could be liable for both U.S. and U.K. taxes, which could have a material adverse effect on our financial condition and results of operations.
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Risk or uncertainty
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Discussion
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Competition
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Our businesses are highly competitive, and if we fail to compete successfully, our revenues and results of operations may be hurt.
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We operate in a highly competitive global environment. Our businesses compete with other broad-line manufacturers, as well as many smaller businesses specializing in particular products or services, primarily on the basis of brand, design, quality, safety, ease of use, serviceability, price, product features, warranty, delivery, service, and technical support. We face increased competition from new infection prevention, sterile processing, contamination control, surgical support, cleaning consumables, gastrointestinal endoscopy accessories, contract sterilization, and other products and services entering the market. Competitors and potential competitors also are attempting to develop alternate technologies and sterilizing agents, as well as disposable medical instruments and other devices designed to address the risk of contamination.
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Consolidations among our healthcare and pharmaceutical Customers may result in a loss of Customers or more significant pricing pressures.
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A number of our Customers have consolidated. These consolidations are due in part to healthcare cost reduction measures initiated by competitive pressures as well as legislators, regulators and third-party payors. In an effort to attract Customers, some of our competitors have also reduced production costs and lowered prices. This has resulted in greater pricing pressures on us and in some cases loss of Customers. Additional consolidations could result in a loss of Customers or more significant pricing pressures.
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We engage in acquisitions and affiliations, divestitures, and other business arrangements. Our growth may be adversely affected if we are unable to successfully identify, price, and integrate strategic business candidates or otherwise optimize our business portfolio.
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Our success depends, in part, on strategic acquisitions and joint ventures, which are intended to complement or expand our businesses, divestiture of non-strategic businesses, and other actions intended to optimize our portfolio of businesses. This strategy depends upon our ability to identify, appropriately price, and complete these types of business development transactions or arrangements and to obtain any necessary financing. In the last several fiscal years we have made a number of acquisitions, the most significant of which was the acquisition of Synergy Health plc. We also completed several divestitures of non-strategic businesses or product lines during fiscal 2018 and 2017 including linen management services in the U.K., U.S. and Netherlands, laboratory services in the U.K., a consumables product line in the U.K., and our Applied Infection Control product line.
Our success with respect to these recent and future acquisitions will depend on our ability to integrate the businesses acquired, retain key personnel, realize identified cost synergies and otherwise execute our strategies. Our success will also depend on our ability to develop satisfactory working arrangements with our strategic partners in joint ventures or other affiliations, or to divest or realign businesses. Competition for strategic business candidates may result in increases in costs and price for acquisition candidates and market valuation issues may reduce the value available for divestiture of non-strategic businesses. These types of transactions are also subject to a number of other risks and uncertainties, including: delays in realizing or failure to realize anticipated benefits of the transactions; diversion of management’s time and attention from other business concerns; difficulties in retaining key employees, Customers, or suppliers of the acquired or divested businesses; difficulties in maintaining uniform standards, controls, procedures and policies, or other integration or divestiture difficulties; adverse effects on existing business relationships with suppliers or Customers; other events contributing to difficulties in generating future cash flows; risks associated with the assumption of contingent or other liabilities of acquisition targets or retention of liabilities for divested businesses and difficulties in obtaining financing.
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If our continuing efforts to create a lean business and in-source production to reduce costs are not successful, our profitability may be hurt or our business otherwise might be adversely affected.
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We have undertaken various activities to create a lean business, including in-sourcing. We continue to look for opportunities to in-source production that is currently provided by third parties and have made large investments during the past few fiscal years. These activities may not produce the full efficiencies and cost reduction benefits that we expect or efficiencies and benefits might be delayed. Implementation costs also might exceed expectations.
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Our business and results of operations may be adversely affected if we are unable to recruit and retain qualified management and other personnel or other compliance matters adversely impact our personnel.
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Our continued success depends, in large part, on our ability to hire and retain highly qualified people and if we are unable to do so, our business and operations may be impaired or disrupted. Competition for highly qualified people is intense and there is no assurance that we will be successful in attracting or retaining replacements to fill vacant positions, successors to fill retirements or employees moving to new positions, or other highly qualified personnel. In addition, legal, regulatory or compliance matters create significant distraction or diversion of significant or unanticipated resources or attention that could have a material adverse effect on the responsibilities and retention of qualified employees.
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We could experience a failure of a key information technology system, process or site or a breach of information security, including a cybersecurity breach or failure of one or more key information technology systems, networks, processes, associated sites or service providers.
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We rely extensively on information technology (IT) systems to conduct business. In addition, we rely on networks and services, including internet sites, data hosting and processing facilities and tools and other hardware, software and technical applications and platforms, some of which are managed, hosted, provided and/or used by third-parties or their vendors, to assist in conducting our business. Numerous and evolving cybersecurity threats pose potential risks to the security of our IT systems, networks and services, as well as the confidentiality, availability and integrity of our data. While we have made investments seeking to address these threats, including monitoring of networks and systems, hiring of experts, employee training and security policies for employees and third-party providers, the techniques used in these attacks change frequently and may be difficult to detect for periods of time and we may face difficulties in anticipating and implementing adequate preventative measures. If our IT systems are damaged or cease to function properly, the networks or service providers we rely upon fail to function properly, or we or one of our third-party providers suffer a loss or disclosure of our business or stakeholder information due to any number of causes ranging from catastrophic events or power outages to improper data handling or security breaches and our business continuity plans do not effectively address these failures on a timely basis, we may be exposed to reputational, competitive and business harm as well as litigation and regulatory action. Enforcement of the General Data Protection Regulation (“GDPR”) is effective as of May 2018. The GDPR is focused on the protection of personal data not merely the privacy of personal data. The GDPR creates a range of new compliance obligations and will significantly increase financial penalties for noncompliance (including possible fines of up to 4% of global annual turnover for the preceding financial year or €20 million (whichever is higher) for the most serious infringements).
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United Kingdom (U.K.), United States (U.S.) Locations (including Puerto Rico) and International Locations (INTL)
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Location
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U.K/U.S./INTL*
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Use
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Owned/Leased
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Malle, Belgium
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INTL
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Sales Office/ Operations/ Warehousing
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Leased
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Antwerpen, Belgium
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INTL
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Sales Office/Operations
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Leased
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Sao Paulo, Brazil
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INTL
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Sales Office
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Leased
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Mississauga, Canada
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INTL
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Sales Office/Warehousing
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Leased
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Beijing, China
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INTL
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Sales Office
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|
Leased
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Nanjing, China
|
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INTL
|
|
Operations
|
|
Leased
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Shanghai, China
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INTL
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Sales Office/ Manufacturing
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|
Leased
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Suzhou, China
|
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INTL
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|
Operations
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|
Leased
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Wuhan, China
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INTL
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Operations
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Leased
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La Chapelle St. Mesmin, France
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INTL
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Sales Office
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|
Leased
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Marseille, France
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INTL
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Contract Sterilization
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|
Leased
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Paris, France
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INTL
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Sales Office
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Leased
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Toussieu, France
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INTL
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Warehousing
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Leased
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Allershausen, Germany
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INTL
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Contract Sterilization
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|
Leased
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Cologne, Germany
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INTL
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Sales Office
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Leased
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Gokul Nagar, India
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INTL
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Sales Office
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Leased
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Poggio Rusco, Italy
|
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INTL
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Contract Sterilization
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|
Leased
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Segrate, Italy
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INTL
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Sales Office
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Leased
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Seriate, Italy
|
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INTL
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Contract Sterilization/Operations
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Leased
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Trescore Balneario, Italy
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INTL
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Operations
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Leased
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Tokyo, Japan
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INTL
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Sales Office
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Leased
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Kuala Ketil, Malaysia
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INTL
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Contract Sterilization
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|
Leased
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Kulim, Malaysia
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INTL
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Contract Sterilization
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|
Leased
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MINT Bangi, Malaysia
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INTL
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Contract Sterilization
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Leased
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Petaling Jaya, Malaysia
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INTL
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Sales Office
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Leased
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Guadalupe, Mexico
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INTL
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Manufacturing
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Leased
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Utrecht, Netherlands
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INTL
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Operations
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Leased
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Moscow, Russia
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INTL
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Sales Office
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|
Leased
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Singapore (2 locations)
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INTL
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Sales Office/Warehousing
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|
Leased
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Madrid, Spain
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INTL
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Sales Office
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Leased
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New Cross, England
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U.K
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Operations
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|
Leased
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Basingstoke, England
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U.K.
|
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Sales Office
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Leased
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Derby, England
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U.K.
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Operations
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Leased
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Hoddesdon, England
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U.K.
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Operations
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Leased
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Chorley, England
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U.K.
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Operations
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Leased
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Leicester, England (2 locations)
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U.K.
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Warehousing/Operations
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Leased
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Lincoln, England
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U.K.
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Operations
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Leased
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Grimsby England
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U.K.
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Operations
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Leased
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Knowsley, England
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U.K.
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Operations
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Leased
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Oxfordshire, England
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U.K.
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Contract Sterilization
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Leased
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Sheffield, England
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U.K.
|
|
Operations
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Leased
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Strathclyde, Scotland
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U.K.
|
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Operations
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Leased
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Swindon, England
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U.K.
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Operations
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Leased
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ITEM 3.
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LEGAL PROCEEDINGS
|
ITEM 5.
|
MARKET FOR REGISTRANT’S ORDINARY EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
Quarters Ended
|
|
March 31
|
|
December 31
|
|
September 30
|
|
June 30
|
||||||||
Fiscal 2018
|
|
|
|
|
|
|
|
|
||||||||
High
|
|
$
|
96.43
|
|
|
$
|
93.39
|
|
|
$
|
88.43
|
|
|
$
|
83.54
|
|
Low
|
|
82.88
|
|
|
86.02
|
|
|
80.74
|
|
|
69.11
|
|
||||
Fiscal 2017
|
|
|
|
|
|
|
|
|
||||||||
High
|
|
$
|
72.35
|
|
|
$
|
73.06
|
|
|
$
|
74.63
|
|
|
$
|
74.10
|
|
Low
|
|
65.27
|
|
|
63.80
|
|
|
67.25
|
|
|
63.26
|
|
|
|
(a)
Total Number of
Shares Purchased
|
|
(b)
Average Price Paid
Per Share
|
|
(c)
Total Number of
Shares Purchased as
Part of Publicly
Announced Plans
|
|
(d)
Maximum Dollar Value of Shares that May Yet Be Purchased Under the
Plans at Period End (dollars in thousands)
|
||||||
January 1-31
|
|
84,000
|
|
|
$
|
90.53
|
|
|
84,000
|
|
|
$
|
164,225
|
|
February 1-28
|
|
70,116
|
|
|
88.78
|
|
|
70,116
|
|
|
158,000
|
|
||
March 1-31
|
|
74,300
|
|
|
93.39
|
|
|
74,300
|
|
|
151,061
|
|
||
Total
|
|
228,416
|
|
(1)
|
$
|
90.92
|
|
(1)
|
228,416
|
|
|
$
|
151,061
|
|
|
|
Years Ended March 31,
|
||||||||||||||||||
(in thousands, except per share data)
|
|
2018
(1)
|
|
2017
(1)
|
|
2016
(1)
|
|
2015
(1)
|
|
2014
(1)
|
||||||||||
Statements of Income Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
$
|
2,619,996
|
|
|
$
|
2,612,756
|
|
|
$
|
2,238,764
|
|
|
$
|
1,850,263
|
|
|
$
|
1,622,252
|
|
Gross profit
|
|
1,094,223
|
|
|
1,025,632
|
|
|
895,481
|
|
|
774,301
|
|
|
649,622
|
|
|||||
Restructuring expenses
|
|
103
|
|
|
215
|
|
|
(820
|
)
|
|
(391
|
)
|
|
13,204
|
|
|||||
Income from continuing operations
|
|
403,454
|
|
|
227,595
|
|
|
212,927
|
|
|
227,211
|
|
|
206,807
|
|
|||||
Income taxes
|
|
63,360
|
|
|
74,015
|
|
|
60,299
|
|
|
73,756
|
|
|
58,934
|
|
|||||
Net income attributable to shareholders
|
|
290,915
|
|
|
109,965
|
|
|
110,763
|
|
|
135,064
|
|
|
129,442
|
|
|||||
Basic income per ordinary share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
$
|
3.42
|
|
|
$
|
1.29
|
|
|
$
|
1.57
|
|
|
$
|
2.27
|
|
|
$
|
2.20
|
|
Shares used in computing net income per ordinary share – basic
|
|
85,028
|
|
|
85,473
|
|
|
70,698
|
|
|
59,413
|
|
|
58,966
|
|
|||||
Diluted income per ordinary share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
$
|
3.39
|
|
|
$
|
1.28
|
|
|
$
|
1.56
|
|
|
$
|
2.25
|
|
|
$
|
2.17
|
|
Shares used in computing net income per ordinary share – diluted
|
|
85,713
|
|
|
86,094
|
|
|
71,184
|
|
|
60,045
|
|
|
59,745
|
|
|||||
Dividends per ordinary share
|
|
$
|
1.21
|
|
|
$
|
1.09
|
|
|
$
|
0.98
|
|
|
$
|
0.90
|
|
|
$
|
0.82
|
|
Balance Sheets Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Working capital
|
|
$
|
591,195
|
|
|
$
|
636,219
|
|
|
$
|
571,919
|
|
|
$
|
437,101
|
|
|
$
|
420,239
|
|
Total assets
|
|
5,200,334
|
|
|
4,924,555
|
|
|
5,346,416
|
|
|
2,097,291
|
|
|
1,887,162
|
|
|||||
Long-term indebtedness
|
|
1,316,001
|
|
|
1,478,361
|
|
|
1,567,796
|
|
|
621,075
|
|
|
493,480
|
|
|||||
Total liabilities
|
|
1,983,034
|
|
|
2,114,422
|
|
|
2,307,524
|
|
|
1,023,645
|
|
|
845,916
|
|
|||||
Total shareholders’ equity
|
|
$
|
3,205,960
|
|
|
$
|
2,798,602
|
|
|
$
|
3,023,034
|
|
|
$
|
1,071,632
|
|
|
$
|
1,038,705
|
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
what factors affect our business;
|
•
|
what our earnings and costs were;
|
•
|
why those earnings and costs were different from the year before;
|
•
|
where our earnings came from;
|
•
|
how this affects our overall financial condition;
|
•
|
what our expenditures for capital projects were; and
|
•
|
where cash will come from to fund future debt principal repayments, growth outside of core operations, repurchase ordinary shares, pay cash dividends and fund future working capital needs.
|
•
|
Backlog
– We define backlog as the amount of unfilled capital equipment purchase orders at a point in time. We use this figure as a measure to assist in the projection of short-term financial results and inventory requirements.
|
•
|
Debt-to-total capital
– We define debt-to-total capital as total debt divided by the sum of total debt and shareholders’ equity. We use this figure as a financial liquidity measure to gauge our ability to borrow and fund growth.
|
•
|
Days sales outstanding (“DSO”)
– We define DSO as the average collection period for accounts receivable. It is calculated as net accounts receivable divided by the trailing four quarters’ revenues, multiplied by 365 days. We use this figure to help gauge the quality of accounts receivable and expected time to collect.
|
•
|
Revenues
– Our revenues are presented net of sales returns and allowances.
|
•
|
Product Revenues
– We define product revenues as revenues generated from sales of consumable and capital equipment products.
|
•
|
Service Revenues
– We define service revenues as revenues generated from parts and labor associated with the maintenance, repair, and installation of our capital equipment. Service revenues also include hospital sterilization services, instrument and scope repairs, and linen management as well as revenues generated from contract sterilization and laboratory services offered through our Applied Sterilization Technologies segment. Linen management services were divested in fiscal 2017.
|
•
|
Capital Equipment Revenues
– We define capital equipment revenues as revenues generated from sales of capital equipment, which includes steam sterilizers, low temperature liquid chemical sterilant processing systems, including SYSTEM 1 and 1E, washing systems, VHP
®
technology, water stills, and pure steam generators; surgical lights and tables; and integrated OR.
|
•
|
Consumable Revenues
– We define consumable revenues as revenues generated from sales of the consumable family of products, which includes SYSTEM 1 and 1E consumables, V-Pro consumables, gastrointestinal endoscopy accessories, sterility assurance products, skin care products, cleaning consumables, barrier product solutions and surgical instruments.
|
•
|
Recurring Revenues
– We define recurring revenues as revenues generated from sales of consumable products and service revenues.
|
|
|
Years Ended March 31,
|
||||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net cash flows provided by operating activities
|
|
$
|
457,632
|
|
|
$
|
424,086
|
|
|
$
|
254,675
|
|
Purchases of property, plant, equipment and intangibles, net
|
|
(165,457
|
)
|
|
(172,901
|
)
|
|
(126,407
|
)
|
|||
Proceeds from the sale of property, plant, equipment and intangibles
|
|
2,094
|
|
|
4,846
|
|
|
844
|
|
|||
Free cash flow
|
|
$
|
294,269
|
|
|
$
|
256,031
|
|
|
$
|
129,112
|
|
|
|
Years Ended March 31,
|
|
|
|
Percent
|
|||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
Change
|
|
Change
|
|||||||
Total revenues
|
|
$
|
2,619,996
|
|
|
$
|
2,612,756
|
|
|
$
|
7,240
|
|
|
0.3
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
Revenues by type:
|
|
|
|
|
|
|
|
|
|||||||
Service revenues
|
|
1,399,363
|
|
|
1,414,437
|
|
|
(15,074
|
)
|
|
(1.1
|
)%
|
|||
Consumable revenues
|
|
581,563
|
|
|
558,834
|
|
|
22,729
|
|
|
4.1
|
%
|
|||
Capital equipment revenues
|
|
639,070
|
|
|
639,485
|
|
|
(415
|
)
|
|
(0.1
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Revenues by geography:
|
|
|
|
|
|
|
|
|
|||||||
United Kingdom revenues
|
|
207,514
|
|
|
229,603
|
|
|
(22,089
|
)
|
|
(9.6
|
)%
|
|||
United States revenues
|
|
1,836,414
|
|
|
1,803,457
|
|
|
32,957
|
|
|
1.8
|
%
|
|||
Other foreign revenues
|
|
576,068
|
|
|
579,696
|
|
|
(3,628
|
)
|
|
(0.6
|
)%
|
|
|
Years Ended March 31,
|
|
Change
|
|
Percent
Change
|
|||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
||||||||||
Gross profit:
|
|
|
|
|
|
|
|
|
|||||||
Product
|
|
$
|
574,456
|
|
|
$
|
574,299
|
|
|
$
|
157
|
|
|
NM
|
|
Service
|
|
519,767
|
|
|
451,333
|
|
|
68,434
|
|
|
15.2
|
%
|
|||
Total gross profit
|
|
$
|
1,094,223
|
|
|
$
|
1,025,632
|
|
|
$
|
68,591
|
|
|
6.7
|
%
|
Gross profit percentage:
|
|
|
|
|
|
|
|
|
|||||||
Product
|
|
47.1
|
%
|
|
47.9
|
%
|
|
|
|
|
|||||
Service
|
|
37.1
|
%
|
|
31.9
|
%
|
|
|
|
|
|||||
Total gross profit percentage
|
|
41.8
|
%
|
|
39.3
|
%
|
|
|
|
|
|
|
Years Ended March 31,
|
|
Change
|
|
Percent
Change
|
|||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|||||||
Selling, general, and administrative
|
|
$
|
629,884
|
|
|
$
|
680,069
|
|
|
$
|
(50,185
|
)
|
|
(7.4
|
)%
|
Goodwill impairment loss
|
|
—
|
|
|
58,356
|
|
|
(58,356
|
)
|
|
NM
|
|
|||
Research and development
|
|
60,782
|
|
|
59,397
|
|
|
1,385
|
|
|
2.3
|
%
|
|||
Restructuring expenses
|
|
103
|
|
|
215
|
|
|
(112
|
)
|
|
NM
|
|
|||
Total operating expenses
|
|
$
|
690,769
|
|
|
$
|
798,037
|
|
|
$
|
(107,268
|
)
|
|
(13.4
|
)%
|
|
|
Years Ended March 31,
|
|
|
||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
Change
|
||||||
Non-operating expenses, net:
|
|
|
|
|
|
|
||||||
Interest expense
|
|
$
|
50,629
|
|
|
$
|
44,520
|
|
|
$
|
6,109
|
|
Interest income and miscellaneous expense
|
|
(2,157
|
)
|
|
(1,571
|
)
|
|
(586
|
)
|
|||
Non-operating expenses, net
|
|
$
|
48,472
|
|
|
$
|
42,949
|
|
|
$
|
5,523
|
|
|
|
Years Ended March 31,
|
|
Change
|
|
Percent
Change
|
||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
|||||||||
Income tax expense
|
|
$
|
63,360
|
|
|
$
|
74,015
|
|
|
$
|
(10,655
|
)
|
|
(14.4)%
|
Effective income tax rate
|
|
17.8
|
%
|
|
40.1
|
%
|
|
|
|
|
|
|
Years ended March 31,
|
|
|
|
Percent
|
|||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
Change
|
|
Change
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|||||||
Healthcare Products
|
|
$
|
1,276,054
|
|
|
$
|
1,266,517
|
|
|
$
|
9,537
|
|
|
0.8
|
%
|
Healthcare Specialty Services
|
|
469,065
|
|
|
539,536
|
|
|
(70,471
|
)
|
|
(13.1
|
)%
|
|||
Life Sciences
|
|
361,590
|
|
|
328,866
|
|
|
32,724
|
|
|
10.0
|
%
|
|||
Applied Sterilization Technologies
|
|
513,287
|
|
|
477,837
|
|
|
35,450
|
|
|
7.4
|
%
|
|||
Total revenues
|
|
$
|
2,619,996
|
|
|
$
|
2,612,756
|
|
|
$
|
7,240
|
|
|
0.3
|
%
|
Operating income (loss):
|
|
|
|
|
|
|
|
|
|||||||
Healthcare Products
|
|
221,795
|
|
|
227,707
|
|
|
(5,912
|
)
|
|
(2.6
|
)%
|
|||
Healthcare Specialty Services
|
|
28,910
|
|
|
10,573
|
|
|
18,337
|
|
|
173.4
|
%
|
|||
Life Sciences
|
|
106,737
|
|
|
97,180
|
|
|
9,557
|
|
|
9.8
|
%
|
|||
Applied Sterilization Technologies
|
|
173,375
|
|
|
158,379
|
|
|
14,996
|
|
|
9.5
|
%
|
|||
Corporate
|
|
(17,439
|
)
|
|
(17,307
|
)
|
|
(132
|
)
|
|
NM
|
|
|||
Total operating income before adjustments
|
|
$
|
513,378
|
|
|
$
|
476,532
|
|
|
$
|
36,846
|
|
|
7.7
|
%
|
Less: Adjustments
|
|
|
|
|
|
|
|
|
|||||||
Goodwill impairment loss
(1)
|
|
—
|
|
|
58,356
|
|
|
|
|
|
|||||
Amortization of inventory and property "step up" to fair value
(2)
|
|
1,599
|
|
|
4,743
|
|
|
|
|
|
|||||
Amortization and impairment of purchased intangible assets
(2)
|
|
67,793
|
|
|
66,398
|
|
|
|
|
|
|||||
Acquisition related transaction and integration charges
(3)
|
|
16,211
|
|
|
30,082
|
|
|
|
|
|
|||||
Loss (gain) on fair value adjustment of acquisition related contingent consideration
|
|
(593
|
)
|
|
2,569
|
|
|
|
|
|
|||||
Net loss on divestiture of businesses
(2)
|
|
14,547
|
|
|
86,574
|
|
|
|
|
|
|||||
Impact of the U.S. Tax Cuts and Jobs Act
(4)
|
|
10,264
|
|
|
—
|
|
|
|
|
|
|||||
Restructuring charges
|
|
103
|
|
|
215
|
|
|
|
|
|
|||||
Total operating income
|
|
$
|
403,454
|
|
|
$
|
227,595
|
|
|
|
|
|
|
|
Years Ended March 31,
|
|
|
|
Percent
|
|||||||||
(dollars in thousands)
|
|
2017
|
|
2016
|
|
Change
|
|
Change
|
|||||||
Total revenues
|
|
$
|
2,612,756
|
|
|
$
|
2,238,764
|
|
|
$
|
373,992
|
|
|
16.7
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
Revenues by type:
|
|
|
|
|
|
|
|
|
|||||||
Service revenues
|
|
1,414,437
|
|
|
1,109,779
|
|
|
304,658
|
|
|
27.5
|
%
|
|||
Consumable revenues
|
|
558,834
|
|
|
516,044
|
|
|
42,790
|
|
|
8.3
|
%
|
|||
Capital equipment revenues
|
|
639,485
|
|
|
612,941
|
|
|
26,544
|
|
|
4.3
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Revenues by geography:
|
|
|
|
|
|
|
|
|
|||||||
United Kingdom revenues
|
|
229,603
|
|
|
144,577
|
|
|
85,026
|
|
|
58.8
|
%
|
|||
United States revenues
|
|
1,803,457
|
|
|
1,662,050
|
|
|
141,407
|
|
|
8.5
|
%
|
|||
Other foreign revenues
|
|
579,696
|
|
|
432,137
|
|
|
147,559
|
|
|
34.1
|
%
|
|
|
Years Ended March 31,
|
|
Change
|
|
Percent
Change
|
|||||||||
(dollars in thousands)
|
|
2017
|
|
2016
|
|
||||||||||
Gross profit:
|
|
|
|
|
|
|
|
|
|||||||
Product
|
|
$
|
574,299
|
|
|
$
|
511,617
|
|
|
$
|
62,682
|
|
|
12.3
|
%
|
Service
|
|
451,333
|
|
|
383,864
|
|
|
67,469
|
|
|
17.6
|
%
|
|||
Total gross profit
|
|
$
|
1,025,632
|
|
|
$
|
895,481
|
|
|
$
|
130,151
|
|
|
14.5
|
%
|
Gross profit percentage:
|
|
|
|
|
|
|
|
|
|||||||
Product
|
|
47.9
|
%
|
|
45.3
|
%
|
|
|
|
|
|||||
Service
|
|
31.9
|
%
|
|
34.6
|
%
|
|
|
|
|
|||||
Total gross profit percentage
|
|
39.3
|
%
|
|
40.0
|
%
|
|
|
|
|
|
|
Years Ended March 31,
|
|
Change
|
|
Percent
Change
|
|||||||||
(dollars in thousands)
|
|
2017
|
|
2016
|
|
||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|||||||
Selling, general, and administrative
|
|
$
|
680,069
|
|
|
$
|
626,710
|
|
|
$
|
53,359
|
|
|
8.5
|
%
|
Goodwill impairment loss
|
|
58,356
|
|
|
—
|
|
|
58,356
|
|
|
NM
|
|
|||
Research and development
|
|
59,397
|
|
|
56,664
|
|
|
2,733
|
|
|
4.8
|
%
|
|||
Restructuring expenses
|
|
215
|
|
|
(820
|
)
|
|
1,035
|
|
|
NM
|
|
|||
Total operating expenses
|
|
$
|
798,037
|
|
|
$
|
682,554
|
|
|
$
|
115,483
|
|
|
16.9
|
%
|
|
|
Years Ended March 31,
|
|
|
||||||||
(dollars in thousands)
|
|
2017
|
|
2016
|
|
Change
|
||||||
Non-operating expenses, net:
|
|
|
|
|
|
|
||||||
Interest expense
|
|
$
|
44,520
|
|
|
$
|
42,708
|
|
|
$
|
1,812
|
|
Interest income and miscellaneous expense
|
|
(1,571
|
)
|
|
(1,665
|
)
|
|
94
|
|
|||
Non-operating expenses, net
|
|
$
|
42,949
|
|
|
$
|
41,043
|
|
|
$
|
1,906
|
|
|
|
Years Ended March 31,
|
|
Change
|
|
Percent
Change
|
||||||||
(dollars in thousands)
|
|
2017
|
|
2016
|
|
|||||||||
Income tax expense
|
|
$
|
74,015
|
|
|
$
|
60,299
|
|
|
$
|
13,716
|
|
|
22.7%
|
Effective income tax rate
|
|
40.1
|
%
|
|
35.1
|
%
|
|
|
|
|
|
|
Years ended March 31,
|
|
|
|
Percent
|
|||||||||
(dollars in thousands)
|
|
2017
|
|
2016
|
|
Change
|
|
Change
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|||||||
Healthcare Products
|
|
$
|
1,266,517
|
|
|
$
|
1,204,774
|
|
|
$
|
61,743
|
|
|
5.1
|
%
|
Healthcare Specialty Services
|
|
539,536
|
|
|
420,220
|
|
|
119,316
|
|
|
28.4
|
%
|
|||
Life Sciences
|
|
328,866
|
|
|
297,733
|
|
|
31,133
|
|
|
10.5
|
%
|
|||
Applied Sterilization Technologies
|
|
477,837
|
|
|
316,037
|
|
|
161,800
|
|
|
51.2
|
%
|
|||
Total revenues
|
|
$
|
2,612,756
|
|
|
$
|
2,238,764
|
|
|
$
|
373,992
|
|
|
16.7
|
%
|
Operating income (loss):
|
|
|
|
|
|
|
|
|
|||||||
Healthcare Products
|
|
227,707
|
|
|
181,265
|
|
|
46,442
|
|
|
25.6
|
%
|
|||
Healthcare Specialty Services
|
|
10,573
|
|
|
24,299
|
|
|
(13,726
|
)
|
|
(56.5
|
)%
|
|||
Life Sciences
|
|
97,180
|
|
|
84,564
|
|
|
12,616
|
|
|
14.9
|
%
|
|||
Applied Sterilization Technologies
|
|
158,379
|
|
|
99,854
|
|
|
58,525
|
|
|
58.6
|
%
|
|||
Corporate
|
|
(17,307
|
)
|
|
(11,320
|
)
|
|
(5,987
|
)
|
|
NM
|
|
|||
Total operating income before adjustments
|
|
$
|
476,532
|
|
|
$
|
378,662
|
|
|
$
|
97,870
|
|
|
25.8
|
%
|
Less: Adjustments
|
|
|
|
|
|
|
|
|
|||||||
Goodwill impairment loss
(1)
|
|
58,356
|
|
|
—
|
|
|
|
|
|
|||||
Amortization of inventory and property "step up" to fair value
(2)
|
|
4,743
|
|
|
9,907
|
|
|
|
|
|
|||||
Amortization and impairment of purchased intangible assets
(2)
|
|
66,398
|
|
|
47,704
|
|
|
|
|
|
|||||
Acquisition related transaction and integration charges
(3)
|
|
30,082
|
|
|
82,891
|
|
|
|
|
|
|||||
Loss (gain) on fair value adjustment of acquisition related contingent consideration
|
|
2,569
|
|
|
(736
|
)
|
|
|
|
|
|||||
Net loss on divestiture of businesses
(2)
|
|
86,574
|
|
|
—
|
|
|
|
|
|
|||||
Settlement of pension obligation
(4)
|
|
—
|
|
|
26,470
|
|
|
|
|
|
|||||
Restructuring charges
|
|
215
|
|
|
(501
|
)
|
|
|
|
|
|||||
Total operating income
|
|
$
|
227,595
|
|
|
$
|
212,927
|
|
|
|
|
|
|
|
Years Ended March 31,
|
||||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net cash provided by operating activities
|
|
$
|
457,632
|
|
|
$
|
424,086
|
|
|
$
|
254,675
|
|
Net cash used in investing activities
|
|
(203,829
|
)
|
|
(104,255
|
)
|
|
(729,584
|
)
|
|||
Net cash (used in) provided by financing activities
|
|
(356,184
|
)
|
|
(267,099
|
)
|
|
560,289
|
|
|||
Debt-to-total capital ratio
|
|
29.1
|
%
|
|
34.6
|
%
|
|
34.2
|
%
|
|||
Free cash flow
|
|
$
|
294,269
|
|
|
$
|
256,031
|
|
|
$
|
129,112
|
|
•
|
Net cash provided by operating activities increased
7.9%
in fiscal 2018 compared to fiscal 2017. The improvement is primarily due to higher earnings and lower requirements to fund operating assets and liabilities.
|
•
|
Net cash provided by operating activities increased 66.5% in fiscal 2017 compared to fiscal 2016. The improvement was primarily due to higher cash earnings and lower acquisition and integration expenses.
|
•
|
Purchases of property, plant, equipment, and intangibles, net
– Capital expenditures totaled
$165.5 million
during fiscal
2018
,
$172.9 million
during fiscal
2017
and
$126.4 million
during fiscal
2016
. The increase in capital expenditures in fiscal 2017 over fiscal 2016 is the result of the inclusion of capital expenditures related to the operations of Synergy and investments to expand capacity in certain of our Applied Sterilization Technologies facilities.
|
•
|
Proceeds from the sale of business
– During fiscal 2018 and 2017, we received
$8.9 million
and $135.7 million, respectively, for the proceeds from the sale of certain non-core businesses. For more information, refer to our
Note 2
to our consolidated financial statements, titled "Business Acquisitions and Divestitures".
|
•
|
Investments in business, net of cash acquired
– During fiscal 2018, 2017 and 2016, we used
$46.3 million
, $65.6 million and $604.0 million, respectively, for acquisitions. For more information on these acquisitions refer to
Note 2
to our consolidated financial statements titled, "Business Acquisitions and Divestitures".
|
•
|
Purchases of investments
– During fiscal 2017, we invested an additional $6.4 million in the common stock of Servizi Italia, S.p.A., a leading provider of integrated linen washing and outsourced sterile processing services to hospital Customers.
|
•
|
Other
– In connection with the Netherlands Linen Management Services divestiture, we entered into a loan agreement to provide financing to the buyer for a period of 15 years. During fiscal 2018, we provided
$3.1 million
under this agreement. For more information on these acquisitions refer to
Note 2
to our consolidated financial statements titled, "Business Acquisitions and Divestitures".
|
•
|
Proceeds from the issuance of long-term obligations
– On February 27, 2017, we issued and sold to various institutional investors fixed-rate Series A Senior Notes, in the aggregate principal amount of $95.0 million, €99.0 million, and £75.0 million or a total of approximately
$293.7 million
. On May 15, 2015, we issued the aggregate principal amount of $350.0 million of senior notes in a private placement, which were long term obligations. We provide additional information about our debt structure in
Note 6
to our consolidated financial statements titled, “Debt,” and in this section of the MD&A titled, “Liquidity and Capital Resources” in the subsection titled, “Sources of Credit.”
|
•
|
Payments on long-term obligations
- During fiscal 2018 and fiscal 2017, we repaid $222.5 million and $172.5 million on our bank term loan. During fiscal 2016, we repaid $24.0 million of senior notes and $68.6 million of our term loan.
|
•
|
Proceeds under credit facilities, net
– At the end of fiscal
2018
,
$331.2 million
of debt was outstanding under our bank credit facility, compared to $521.6 million and $905.2 million of debt outstanding under this facility at the end of fiscal 2017 and 2016, respectively. We provide additional information about our bank credit facility including the fiscal 2018 refinancing in
Note 6
to our consolidated financial statements titled, “Debt”.
|
•
|
Repurchases of shares
– During fiscal
2018
, we purchased 656,663 of our ordinary shares in the aggregate amount of $58.5 million, which included $0.3 million of taxes and commissions. We also obtained
127,903
of our ordinary shares in connection with our stock-based compensation award programs in the amount
$7.0 million
during fiscal 2018. During fiscal 2017, we purchased 1,286,183 of our ordinary shares in the aggregate amount of $90.5 million, which included $0.5 million of taxes and commissions. We also obtained 168,906 of our ordinary shares in connection with our stock-based compensation award programs in the amount $7.0 million. During fiscal 2016, we obtained 267,696 shares in connection with our stock-based compensation award programs in the amount of $14.4 million. We provide additional information about our share repurchases in
Note 13
to our consolidated financial statements titled, “Repurchases of Ordinary Shares.”
|
•
|
Deferred financing fees and debt issuance costs
- We paid
$2.0 million
, $1.1 million and $5.2 million in fiscal 2018, 2017 and 2016, respectively, for financing fees and debt issuance costs related to our Credit Agreement, Private Placement debt, and former Bridge Credit Agreement. For more information on our debt refer to
Note 6
to our consolidated financial statements titled, "Debt".
|
•
|
Cash dividends paid to ordinary shareholders
– During fiscal
2018
, we paid cash dividends totaling
$102.9 million
or
$1.21
per outstanding share. During fiscal
2017
, we paid cash dividends totaling $93.2 million or $1.09 per outstanding share. During fiscal
2016
, we paid cash dividends totaling $65.2 million, or $0.98 per outstanding share.
|
•
|
Stock option and other equity transactions, net
– We generally receive cash for issuing shares upon the exercise of options under our employee stock option program. During fiscal
2018
, fiscal
2017
and fiscal
2016
, we received cash proceeds totaling $11.1 million, $5.0 million, and $11.2 million, respectively, under these programs. During fiscal
2018
we also paid dividends in the amount of $1.4 million to minority interest shareholders.
|
•
|
Excess tax benefit from share-based compensation
– For the year ended March 31,
2016 our income taxes were reduced by $6.3 million as a result of deductions allowed for stock options exercised and restricted share vestings.
|
(dollars in thousands)
|
Maximum
Amounts
Available
|
|
Reductions in
Available Credit
Facility for Other
Financial Instruments
|
|
March 31, 2018 Amounts
Outstanding
|
|
March 31, 2018 Amounts
Available
|
||||||||
Sources of Credit
|
|
|
|
|
|
|
|
||||||||
Private placement
|
$
|
988,190
|
|
|
$
|
—
|
|
|
$
|
988,190
|
|
|
$
|
—
|
|
Credit Agreement
(1)
|
1,000,000
|
|
|
13,406
|
|
|
331,206
|
|
|
655,388
|
|
||||
Total Sources of Credit
|
$
|
1,988,190
|
|
|
$
|
13,406
|
|
|
$
|
1,319,396
|
|
|
$
|
655,388
|
|
•
|
On March 23, 2018, we entered into a Credit Agreement (the "Credit Agreement") with various financial institutions as lenders, and JPMorgan Chase Bank, N.A., as Administrative Agent. The Credit Agreement replaced a bank credit facility dated March 31, 2015. The Credit Agreement provides up to
$1.0 billion
of credit, in the form of a revolver facility, which may be utilized for revolving credit borrowings, swing line borrowings and letters of credit, with sublimits for swing line borrowings and letters of credit. The revolver facility may be increased in specified circumstances by up to
$500.0 million
. The Credit Agreement will mature on March 23, 2023, and all unpaid borrowings, together with accrued and unpaid interest thereon, are repayable on that date. The Credit Agreement contains leverage and interest coverage covenants. Borrowings may be taken in U.S. dollars, euros, and pounds sterling and certain other specified currencies and bear interest at our option based upon either the Base Rate or the Eurocurrency Rate, plus the Applicable Margin in effect from time to time under the Credit Agreement. The Applicable Margin is determined based on the ratio of Consolidated Total Debt to Consolidated EBITDA (as such terms are defined in the Credit Agreement). Interest on Base Rate Advances is payable quarterly in arrears and interest on Eurocurrency Rate Advances is payable at the end of the relevant interest period therefor, but in no event less frequently than every three months. Borrowings at closing were used to repay outstanding balances of debt outstanding under the former bank credit facility dated March 31, 2015 that was scheduled to mature on March 31, 2020 and for other general corporate purposes.
|
(dollars in thousands)
|
|
Applicable Note Purchase Agreement
|
|
Maturity Date
|
|
U.S. Dollar Value at March 31, 2018
|
||
$85,000 Senior notes at 6.33%
|
|
2008 Private Placement
|
|
August 2018
|
|
$
|
85,000
|
|
$35,000 Senior notes at 6.43%
|
|
2008 Private Placement
|
|
August 2020
|
|
35,000
|
|
|
$91,000 Senior notes at 3.20%
|
|
2012 Private Placement
|
|
December 2022
|
|
91,000
|
|
|
$80,000 Senior notes at 3.35%
|
|
2012 Private Placement
|
|
December 2024
|
|
80,000
|
|
|
$25,000 Senior notes at 3.55%
|
|
2012 Private Placement
|
|
December 2027
|
|
25,000
|
|
|
$125,000 Senior notes at 3.45%
|
|
2015 Private Placement
|
|
May 2025
|
|
125,000
|
|
|
$125,000 Senior notes at 3.55%
|
|
2015 Private Placement
|
|
May 2027
|
|
125,000
|
|
|
$100,000 Senior notes at 3.70%
|
|
2015 Private Placement
|
|
May 2030
|
|
100,000
|
|
|
$50,000 Senior notes at 3.93%
|
|
2017 Private Placement
|
|
February 2027
|
|
50,000
|
|
|
€60,000 Senior notes at 1.86%
|
|
2017 Private Placement
|
|
February 2027
|
|
73,912
|
|
|
$45,000 Senior notes at 4.03%
|
|
2017 Private Placement
|
|
February 2029
|
|
45,000
|
|
|
€20,000 Senior notes at 2.04%
|
|
2017 Private Placement
|
|
February 2029
|
|
24,637
|
|
|
£45,000 Senior notes at 3.04%
|
|
2017 Private Placement
|
|
February 2029
|
|
63,141
|
|
|
€19,000 Senior notes at 2.30%
|
|
2017 Private Placement
|
|
February 2032
|
|
23,406
|
|
|
£30,000 Senior notes at 3.17%
|
|
2017 Private Placement
|
|
February 2032
|
|
42,094
|
|
|
Total Senior Notes
|
|
|
|
|
|
$
|
988,190
|
|
•
|
On February 27, 2017, we issued and sold an aggregate principal amount of
$95.0 million
,
€99.0 million
, and
£75.0 million
, of senior notes in a private placement to certain institutional investors in an offering that was exempt from the registration requirements of the Securities Act of 1933. These notes have maturities of between
10
and
15
years from the issue date. The agreement governing these notes contains leverage and interest coverage covenants.
|
•
|
On May 15, 2015, Old STERIS issued and sold
$350.0 million
of senior notes, in a private placement to certain institutional investors in an offering that was exempt from the registration requirements of the Securities Act of 1933. These notes have maturities of
10
to
15
years from the issue date. The agreement governing these notes contains leverage and interest coverage covenants.
|
•
|
The agreements governing certain senior notes issued and sold in February 2013, December 2012, and August 2008, were amended and restated in their entirety on March 31, 2015. All of these notes were issued and sold in private placements to certain institutional investors in offerings that were exempt from the registration requirements of the Securities Act of 1933. The amended and restated agreements, which have been consolidated into a single agreement for the 2013 and 2012 notes, and a separate single agreement for the 2008 notes, contain leverage and interest coverage covenants.
|
|
|
Payments due by March 31,
|
|
|
||||||||||||||||||||
(dollars in thousands)
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023 and thereafter
|
|
Total
|
||||||||||||
Contractual Obligations:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Debt
|
|
$
|
85,000
|
|
|
$
|
—
|
|
|
$
|
35,000
|
|
|
$
|
—
|
|
|
$
|
1,199,396
|
|
|
$
|
1,319,396
|
|
Operating leases
|
|
24,116
|
|
|
19,933
|
|
|
14,666
|
|
|
11,051
|
|
|
39,464
|
|
|
109,230
|
|
||||||
Purchase obligations
|
|
29,276
|
|
|
29,617
|
|
|
30,785
|
|
|
27,430
|
|
|
11,363
|
|
|
128,471
|
|
||||||
Benefit payments under defined benefit plans
|
|
3,899
|
|
|
3,903
|
|
|
4,143
|
|
|
4,608
|
|
|
32,719
|
|
|
49,272
|
|
||||||
Trust assets available for benefit payments under defined benefit plans
|
|
(3,785
|
)
|
|
(3,795
|
)
|
|
(4,042
|
)
|
|
(4,514
|
)
|
|
(32,234
|
)
|
|
(48,370
|
)
|
||||||
Benefit payments under other post-retirement benefits plans
|
|
1,907
|
|
|
1,694
|
|
|
1,548
|
|
|
1,436
|
|
|
6,034
|
|
|
12,619
|
|
||||||
Total Contractual Obligations
|
|
$
|
140,413
|
|
|
$
|
51,352
|
|
|
$
|
82,100
|
|
|
$
|
40,011
|
|
|
$
|
1,256,742
|
|
|
$
|
1,570,618
|
|
|
|
Amount of Commitment Expiring March 31,
|
|
|
||||||||||||||||||||
(dollars in thousands)
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023 and thereafter
|
|
Totals
|
||||||||||||
Commercial Commitments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Performance and surety bonds
|
|
$
|
53,219
|
|
|
$
|
449
|
|
|
$
|
4,086
|
|
|
$
|
62
|
|
|
$
|
1,482
|
|
|
$
|
59,298
|
|
Letters of credit as security for self-insured risk retention policies
|
|
7,694
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,694
|
|
||||||
Total Commercial Commitments
|
|
$
|
60,913
|
|
|
$
|
449
|
|
|
$
|
4,086
|
|
|
$
|
62
|
|
|
$
|
1,482
|
|
|
$
|
66,992
|
|
|
Synergy Health plc
|
Isotron BV
|
Synergy Health Daniken AG
|
Synergy Health Radeberg
|
Synergy Health Allershausen
|
Harwell Dosimeters Ltd
|
U.S. Post-
Retirement Benefits Plan
|
|||||||
Funding Status
|
Funded
|
Funded
|
Funded
|
Unfunded
|
Unfunded
|
Funded
|
Unfunded
|
|||||||
Assumptions used to determine March 31, 2018
|
|
|
|
|
|
|
|
|||||||
Benefit obligations:
|
|
|
|
|
|
|
|
|||||||
Discount rate
|
2.50
|
%
|
1.60
|
%
|
0.95
|
%
|
1.60
|
%
|
1.60
|
%
|
2.55
|
%
|
3.50
|
%
|
Assumptions used to determine fiscal 2018
|
|
|
|
|
|
|
|
|||||||
Net periodic benefit costs:
|
|
|
|
|
|
|
|
|||||||
Discount rate
|
2.60
|
%
|
1.60
|
%
|
0.65
|
%
|
1.50
|
%
|
1.50
|
%
|
2.55
|
%
|
3.50
|
%
|
Expected return on plan assets
|
4.97
|
%
|
1.60
|
%
|
1.40
|
%
|
n/a
|
|
n/a
|
|
n/a
|
|
n/a
|
|
|
100 Basis Point
|
||||||
(dollars in thousands)
|
Increase
|
|
Decrease
|
||||
Effect on total service and interest cost components
|
$
|
1
|
|
|
$
|
(1
|
)
|
Effect on postretirement benefit obligation
|
21
|
|
|
(20
|
)
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
|
|
Page
|
|
||
|
Consolidated Financial Statements:
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
Financial Statement Schedule:
|
|
|
March 31,
|
|
2018
|
|
2017
|
||||
Assets
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
201,534
|
|
|
$
|
282,918
|
|
Accounts receivable (net of allowances of $12,472 and $10,357, respectively)
|
|
528,066
|
|
|
483,451
|
|
||
Inventories, net
|
|
205,731
|
|
|
197,837
|
|
||
Prepaid expenses and other current assets
|
|
54,326
|
|
|
53,596
|
|
||
Total current assets
|
|
989,657
|
|
|
1,017,802
|
|
||
Property, plant, and equipment, net
|
|
1,010,524
|
|
|
915,908
|
|
||
Goodwill and intangibles, net
|
|
3,160,764
|
|
|
2,956,190
|
|
||
Other assets
|
|
39,389
|
|
|
34,555
|
|
||
Total assets
|
|
$
|
5,200,334
|
|
|
$
|
4,924,455
|
|
Liabilities and equity
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
135,866
|
|
|
$
|
133,479
|
|
Accrued income taxes
|
|
379
|
|
|
14,640
|
|
||
Accrued payroll and other related liabilities
|
|
94,000
|
|
|
78,575
|
|
||
Accrued expenses and other
|
|
168,217
|
|
|
154,889
|
|
||
Total current liabilities
|
|
398,462
|
|
|
381,583
|
|
||
Long-term indebtedness
|
|
1,316,001
|
|
|
1,478,361
|
|
||
Deferred income taxes, net
|
|
159,971
|
|
|
171,805
|
|
||
Other liabilities
|
|
108,600
|
|
|
82,673
|
|
||
Total liabilities
|
|
$
|
1,983,034
|
|
|
$
|
2,114,422
|
|
Commitments and contingencies (see Note 11)
|
|
|
|
|
|
|
||
Preferred shares, with £0.10 par value; 100 shares authorized; 100 issued and outstanding
|
|
15
|
|
|
15
|
|
||
Ordinary shares, with £0.10 par value; £17,006 aggregate par amount authorized; 84,747 and 84,948 ordinary shares issued and outstanding, respectively
|
|
2,048,037
|
|
|
2,085,134
|
|
||
Retained earnings
|
|
1,146,223
|
|
|
954,155
|
|
||
Accumulated other comprehensive income (loss)
|
|
11,685
|
|
|
(240,702
|
)
|
||
Total shareholders’ equity
|
|
3,205,960
|
|
|
2,798,602
|
|
||
Noncontrolling interests
|
|
11,340
|
|
|
11,431
|
|
||
Total equity
|
|
3,217,300
|
|
|
2,810,033
|
|
||
Total liabilities and equity
|
|
$
|
5,200,334
|
|
|
$
|
4,924,455
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
Revenues:
|
|
|
|
|
|
|
||||||
Product
|
|
$
|
1,220,633
|
|
|
$
|
1,198,319
|
|
|
$
|
1,128,985
|
|
Service
|
|
1,399,363
|
|
|
1,414,437
|
|
|
1,109,779
|
|
|||
Total revenues
|
|
2,619,996
|
|
|
2,612,756
|
|
|
2,238,764
|
|
|||
Cost of revenues:
|
|
|
|
|
|
|
||||||
Product
|
|
646,177
|
|
|
624,020
|
|
|
617,368
|
|
|||
Service
|
|
879,596
|
|
|
963,104
|
|
|
725,915
|
|
|||
Total cost of revenues
|
|
1,525,773
|
|
|
1,587,124
|
|
|
1,343,283
|
|
|||
Gross profit
|
|
1,094,223
|
|
|
1,025,632
|
|
|
895,481
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
||||||
Selling, general, and administrative
|
|
629,884
|
|
|
680,069
|
|
|
626,710
|
|
|||
Goodwill impairment loss
|
|
—
|
|
|
58,356
|
|
|
—
|
|
|||
Research and development
|
|
60,782
|
|
|
59,397
|
|
|
56,664
|
|
|||
Restructuring expenses
|
|
103
|
|
|
215
|
|
|
(820
|
)
|
|||
Total operating expenses
|
|
690,769
|
|
|
798,037
|
|
|
682,554
|
|
|||
Income from operations
|
|
403,454
|
|
|
227,595
|
|
|
212,927
|
|
|||
Non-operating expenses, net:
|
|
|
|
|
|
|
||||||
Interest expense
|
|
50,629
|
|
|
44,520
|
|
|
42,708
|
|
|||
Interest income and miscellaneous expense
|
|
(2,157
|
)
|
|
(1,571
|
)
|
|
(1,665
|
)
|
|||
Total non-operating expenses, net
|
|
48,472
|
|
|
42,949
|
|
|
41,043
|
|
|||
Income before income tax expense
|
|
354,982
|
|
|
184,646
|
|
|
171,884
|
|
|||
Income tax expense
|
|
63,360
|
|
|
74,015
|
|
|
60,299
|
|
|||
Net income
|
|
291,622
|
|
|
110,631
|
|
|
111,585
|
|
|||
Less: Net income attributable to noncontrolling interests
|
|
707
|
|
|
666
|
|
|
822
|
|
|||
Net income attributable to shareholders
|
|
$
|
290,915
|
|
|
$
|
109,965
|
|
|
$
|
110,763
|
|
|
|
|
|
|
|
|
||||||
Net income per share attributable to shareholders:
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
3.42
|
|
|
$
|
1.29
|
|
|
$
|
1.57
|
|
Diluted
|
|
$
|
3.39
|
|
|
$
|
1.28
|
|
|
$
|
1.56
|
|
Cash dividends declared per ordinary share outstanding
|
|
$
|
1.21
|
|
|
$
|
1.09
|
|
|
$
|
0.98
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net income
|
|
$
|
291,622
|
|
|
$
|
110,631
|
|
|
$
|
111,585
|
|
Less: Net income attributable to noncontrolling interests
|
|
707
|
|
|
666
|
|
|
822
|
|
|||
Net income attributable to shareholders
|
|
$
|
290,915
|
|
|
$
|
109,965
|
|
|
$
|
110,763
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive (loss) income
|
|
|
|
|
|
|
||||||
Unrealized gain (loss) on available for sale securities, (net of taxes of $516, $402 and $(266), respectively)
|
|
1,792
|
|
|
851
|
|
|
(1,741
|
)
|
|||
Amortization of pension and postretirement benefit plans costs, (net of taxes of $1,860, $963, and ($700), respectively)
|
|
(4,387
|
)
|
|
(7,463
|
)
|
|
(3,032
|
)
|
|||
Pension settlement (net of taxes of $0, $0 and $10,563, respectively)
|
|
—
|
|
|
—
|
|
|
17,029
|
|
|||
Change in cumulative foreign currency translation adjustment
|
|
254,982
|
|
|
(165,931
|
)
|
|
(13,746
|
)
|
|||
Total other comprehensive income (loss) attributable to shareholders
|
|
252,387
|
|
|
(172,543
|
)
|
|
(1,490
|
)
|
|||
Comprehensive (loss) income attributable to shareholders
|
|
$
|
543,302
|
|
|
$
|
(62,578
|
)
|
|
$
|
109,273
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
Operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
291,622
|
|
|
$
|
110,631
|
|
|
$
|
111,585
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
||||||
Depreciation, depletion, and amortization
|
|
178,332
|
|
|
188,142
|
|
|
143,740
|
|
|||
Deferred income taxes
|
|
(24,722
|
)
|
|
31,274
|
|
|
704
|
|
|||
Share-based compensation expense
|
|
22,187
|
|
|
18,794
|
|
|
16,147
|
|
|||
Pension settlement expense
|
|
—
|
|
|
—
|
|
|
26,470
|
|
|||
Pension contributions made in settlement
|
|
—
|
|
|
—
|
|
|
(4,641
|
)
|
|||
Loss on the disposal of property, plant, equipment,
and intangibles, net
|
|
2,582
|
|
|
760
|
|
|
1,813
|
|
|||
Loss on sale of businesses
|
|
14,547
|
|
|
86,574
|
|
|
—
|
|
|||
Excess tax benefit from share-based compensation
|
|
—
|
|
|
—
|
|
|
(6,281
|
)
|
|||
Goodwill impairment loss
|
|
—
|
|
|
58,356
|
|
|
—
|
|
|||
Other items
|
|
32,229
|
|
|
(13,242
|
)
|
|
(14,328
|
)
|
|||
Changes in operating assets and liabilities, net of effects of acquisitions:
|
|
|
|
|
|
|
||||||
Accounts receivable, net
|
|
(37,731
|
)
|
|
(48,140
|
)
|
|
(31,560
|
)
|
|||
Inventories, net
|
|
(5,178
|
)
|
|
(12,829
|
)
|
|
1,810
|
|
|||
Other current assets
|
|
(1,244
|
)
|
|
2,324
|
|
|
(9,599
|
)
|
|||
Accounts payable
|
|
563
|
|
|
6,884
|
|
|
5,249
|
|
|||
Accruals and other, net
|
|
(15,555
|
)
|
|
(5,442
|
)
|
|
13,566
|
|
|||
Net cash provided by operating activities
|
|
457,632
|
|
|
424,086
|
|
|
254,675
|
|
|||
Investing activities:
|
|
|
|
|
|
|
||||||
Purchases of property, plant, equipment, and intangibles, net
|
|
(165,457
|
)
|
|
(172,901
|
)
|
|
(126,407
|
)
|
|||
Proceeds from the sale of property, plant, equipment, and intangibles
|
|
2,094
|
|
|
4,846
|
|
|
844
|
|
|||
Proceeds from the sale of businesses
|
|
8,888
|
|
|
135,713
|
|
|
—
|
|
|||
Purchases of investments
|
|
—
|
|
|
(6,356
|
)
|
|
—
|
|
|||
Acquisition of business, net of cash acquired
|
|
(46,271
|
)
|
|
(65,557
|
)
|
|
(604,021
|
)
|
|||
Other
|
|
(3,083
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash used in investing activities
|
|
(203,829
|
)
|
|
(104,255
|
)
|
|
(729,584
|
)
|
|||
Financing activities:
|
|
|
|
|
|
|
||||||
Proceeds from the issuance of long-term obligations
|
|
—
|
|
|
293,730
|
|
|
350,000
|
|
|||
Payments on long-term obligations
|
|
(222,500
|
)
|
|
(172,500
|
)
|
|
(92,567
|
)
|
|||
Proceeds under credit facilities, net
|
|
29,065
|
|
|
(196,613
|
)
|
|
369,451
|
|
|||
Deferred financing fees and debt issuance costs
|
|
(2,029
|
)
|
|
(1,073
|
)
|
|
(5,169
|
)
|
|||
Acquisition related deferred or contingent consideration
|
|
(2,064
|
)
|
|
(9,918
|
)
|
|
—
|
|
|||
Repurchases of common shares
|
|
(65,485
|
)
|
|
(97,509
|
)
|
|
(14,369
|
)
|
|||
Cash dividends paid to common shareholders
|
|
(102,929
|
)
|
|
(93,193
|
)
|
|
(65,203
|
)
|
|||
Proceeds from issuance of equity to minority shareholders
|
|
—
|
|
|
5,022
|
|
|
625
|
|
|||
Stock option and other equity transactions, net
|
|
9,758
|
|
|
4,955
|
|
|
11,240
|
|
|||
Excess tax benefit from share-based compensation
|
|
—
|
|
|
—
|
|
|
6,281
|
|
|||
Net cash (used in) provided by financing activities
|
|
(356,184
|
)
|
|
(267,099
|
)
|
|
560,289
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
20,997
|
|
|
(18,655
|
)
|
|
(4,228
|
)
|
|||
Increase (decrease) in cash and cash equivalents
|
|
(81,384
|
)
|
|
34,077
|
|
|
81,152
|
|
|||
Cash and cash equivalents at beginning of period
|
|
282,918
|
|
|
248,841
|
|
|
167,689
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
201,534
|
|
|
$
|
282,918
|
|
|
$
|
248,841
|
|
|
Ordinary Shares
|
Preferred Shares
|
Treasury Shares
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Non-controlling
Interest
|
Total
Equity
|
||||||||||||||||||||
|
Number
|
Amount
|
Number
|
Amount
|
Number
|
Amount
|
|
|
|
|
|||||||||||||||||
Balance at March 31, 2015
|
59,675
|
|
$
|
264,853
|
|
—
|
|
$
|
—
|
|
10,364
|
|
$
|
(320,343
|
)
|
$
|
1,193,791
|
|
$
|
(66,669
|
)
|
$
|
2,014
|
|
$
|
1,073,646
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
110,763
|
|
—
|
|
822
|
|
111,585
|
|
|||||||
Other comprehensive loss
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,490
|
)
|
—
|
|
(1,490
|
)
|
|||||||
Repurchases of ordinary shares
|
(267
|
)
|
(1,020
|
)
|
—
|
|
—
|
|
248
|
|
(12,974
|
)
|
(375
|
)
|
—
|
|
—
|
|
(14,369
|
)
|
|||||||
Equity compensation programs
|
664
|
|
13,624
|
|
—
|
|
—
|
|
(538
|
)
|
13,667
|
|
—
|
|
—
|
|
—
|
|
27,291
|
|
|||||||
Retirement of treasury shares
|
—
|
|
(20,133
|
)
|
—
|
|
—
|
|
(10,074
|
)
|
319,650
|
|
(299,517
|
)
|
—
|
|
—
|
|
—
|
|
|||||||
Issuance of shares for Synergy Combination
|
25,839
|
|
1,887,479
|
|
100
|
|
15
|
|
—
|
|
—
|
|
—
|
|
—
|
|
13,574
|
|
1,901,068
|
|
|||||||
Purchase of subsidiary shares from noncontrolling interest
|
9
|
|
635
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,453
|
)
|
(818
|
)
|
|||||||
Issuance of subsidiary shares to noncontrolling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1,443
|
|
1,443
|
|
|||||||
Tax benefit of stock options exercised
|
—
|
|
6,281
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
6,281
|
|
|||||||
Cash dividends – $0.98 per ordinary share
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(65,203
|
)
|
—
|
|
—
|
|
(65,203
|
)
|
|||||||
Change in noncontrolling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(542
|
)
|
(542
|
)
|
|||||||
Balance at March 31, 2016
|
85,920
|
|
$
|
2,151,719
|
|
100
|
|
$
|
15
|
|
—
|
|
$
|
—
|
|
$
|
939,459
|
|
$
|
(68,159
|
)
|
$
|
15,858
|
|
$
|
3,038,892
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Net income
|
—
|
|
—
|
|
—
|
|
|
|
—
|
|
—
|
|
109,965
|
|
—
|
|
666
|
|
110,631
|
|
|||||||
Other comprehensive loss
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(172,543
|
)
|
—
|
|
(172,543
|
)
|
|||||||
Repurchases of ordinary shares
|
(1,455
|
)
|
(95,433
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(2,076
|
)
|
—
|
|
—
|
|
(97,509
|
)
|
|||||||
Equity compensation programs and other
|
416
|
|
23,826
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
23,826
|
|
|||||||
Purchase of subsidiary shares from noncontrolling interest
|
67
|
|
5,022
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5,374
|
)
|
(352
|
)
|
|||||||
Issuance of subsidiary shares to noncontrolling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
530
|
|
530
|
|
|||||||
Cash dividends – $1.09 per ordinary share
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(93,193
|
)
|
—
|
|
—
|
|
(93,193
|
)
|
|||||||
Other changes in noncontrolling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(249
|
)
|
(249
|
)
|
|||||||
Balance at March 31, 2017
|
84,948
|
|
$
|
2,085,134
|
|
100
|
|
$
|
15
|
|
—
|
|
$
|
—
|
|
$
|
954,155
|
|
$
|
(240,702
|
)
|
$
|
11,431
|
|
$
|
2,810,033
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
290,915
|
|
—
|
|
707
|
|
291,622
|
|
|||||||
Other comprehensive income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
252,387
|
|
—
|
|
252,387
|
|
|||||||
Repurchases of ordinary shares
|
(793
|
)
|
(69,567
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
4,082
|
|
—
|
|
—
|
|
(65,485
|
)
|
|||||||
Equity compensation programs and other
|
592
|
|
32,470
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
32,470
|
|
|||||||
Cash dividends – $1.21 per ordinary share
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(102,929
|
)
|
—
|
|
—
|
|
(102,929
|
)
|
|||||||
Other changes in noncontrolling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
|
(798
|
)
|
(798
|
)
|
|||||||
Balance at March 31, 2018
|
84,747
|
|
$
|
2,048,037
|
|
100
|
|
$
|
15
|
|
—
|
|
$
|
—
|
|
$
|
1,146,223
|
|
$
|
11,685
|
|
$
|
11,340
|
|
$
|
3,217,300
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
Cash paid during the year for:
|
|
|
|
|
|
|
||||||
Interest
|
|
$
|
48,663
|
|
|
$
|
42,797
|
|
|
$
|
37,165
|
|
Income taxes
|
|
85,629
|
|
|
78,009
|
|
|
60,885
|
|
|||
Cash received during the year for income tax refunds
|
|
7,747
|
|
|
2,002
|
|
|
1,697
|
|
Asset Type
|
|
Useful Life
(years)
|
|
Land improvements
|
|
3-40
|
|
Buildings and leasehold improvements
|
|
2-50
|
|
Machinery and equipment
|
|
2-20
|
|
Information Systems
|
|
2-20
|
|
Radioisotope (cobalt-60)
|
|
20
|
|
Standard
|
|
Date of Issuance
|
|
Description
|
|
Date of Adoption
|
|
Effect on the financial statements or other significant matters
|
Standards that have recently been adopted
|
||||||||
ASU 2016-07, "Investments - Equity Method and Joint Ventures, Simplifying the Transition to the Equity Method of Accounting"
(Topic 323)
|
|
March 2016
|
|
The standard replaces the previous requirement to retroactively adopt the equity method. The new standard requires that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor's previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. The standard is effective for annual periods beginning after December 15, 2016 and interim periods within that period. Early adoption is permitted.
|
|
First Quarter Fiscal 2018
|
|
The prospective adoption of this standard did not have a material impact on our consolidated financial statements.
|
ASU 2015-11, "Inventory - Simplifying the Measurement of Inventory"
(Topic 330)
|
|
July 2015
|
|
The standard requires an entity to measure inventory within the scope of this update at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The standard is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years and should be applied prospectively. Early adoption is permitted.
|
|
First Quarter Fiscal 2018
|
|
The prospective adoption of this standard did not have a material impact on our consolidated financial statements.
|
ASU 2017-04, "Intangibles - Goodwill and Other, Simplifying the Test for Goodwill Impairment"
(Topic 350)
|
|
January 2017
|
|
This standard eliminates Step 2 from the goodwill impairment test. In computing the implied fair value of goodwill under Step 2, an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedures that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, under the amendments of this standard, an entity would perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value. The loss should not exceed the total amount of goodwill allocated to that reporting unit. Tax effects should be considered. The standard is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted.
|
|
Third Quarter Fiscal 2018
|
|
The prospective adoption of this standard did not have a material impact on our consolidated financial statements.
|
ASU 2016-09, "Stock Compensation: Improvements to Employee Share-Based Payment Accounting"
(Topic 718)
|
|
March 2016
|
|
The standard simplifies several aspects of the accounting for share-based payment award transactions, including income tax consequences, the classification of awards as either equity or liabilities, and the classification on the statement of cash flows. The standard is effective for annual periods beginning after December 15, 2016 and interim periods within that period. Early adoption is permitted.
|
|
First Quarter Fiscal 2017
|
|
As a result of the adoption of this standard, we recorded $6.6 million and $5.1 million of excess tax benefits associated with share based compensation in the Consolidated Statements of Income for the years ended March 31, 2018 and 2017, respectively, and have included the associated cash flows as cash provided by operating activities. Prior periods have not been restated.
|
Standards that have not yet been adopted
|
||||||||
ASU 2014-09, "Revenue from Contracts with Customers" and subsequently issued amendments
|
|
May 2014
|
|
The standard will replace existing revenue recognition standards and significantly expand the disclosure requirements for revenue arrangements. It may be adopted either retrospectively or on a modified retrospective basis to new contracts and existing contracts with remaining performance obligations as of the effective date. The standard update is effective for annual periods beginning after December 15, 2017 and interim periods within that period. Early adoption is not permitted before the original public entity effective date of December 15, 2016.
|
|
N/A
|
|
We have completed our evaluation of our revenue streams and contracts and have adopted this standard on April 1, 2018 using the modified retrospective method. We have identified certain historical revenue transactions for which the timing of recognition would have been different under this standard. The amount of the cumulative adjustment required to defer revenue based on these transactions at the end of fiscal 2018 represents less than 0.5% of fiscal 2018 revenues, which will reduce retained earnings as of April 1, 2018. We are in the process of finalizing our revenue accounting policy and implementing changes to our business processes, disclosures and controls. Additionally, we expect to provide the required additional disclosures in periods subsequent to the adoption.
|
ASU 2016-01, "Financial Instruments - Overall - Recognition and Measurement of Financial Assets and Liabilities"
(Subtopic
825-10)
|
|
January 2016
|
|
The standard changes how equity investments are measured and presents changes in the fair value of financial liabilities measured under the fair value option. Presentation and disclosure requirements for financial instruments are also affected. Entities will be required to measure equity investments that do not result in consolidation and are not recorded under the equity method at fair value with changes in fair value recognized in net income. The standard clarifies guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale securities. The accounting for other financial instruments, such as loans, investments in debt securities, and financial liabilities is largely unchanged. The standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.
|
|
N/A
|
|
The impact that the standard will have on our consolidated financial statements will depend on the future variability in the fair values of our equity investments. However, based on current investment holdings, the impact is not expected to be material.
|
ASU 2016-02, "Leases"
(Topic 842)
|
|
February 2016
|
|
The standard will require lessees to record all leases, whether finance or operating, on the balance sheet. An asset will be recorded to represent the right to use the leased asset, and a liability will be recorded to represent the lease obligation. The standard is effective for annual periods beginning after December 15, 2018 and interim periods within that period. Early adoption is permitted.
|
|
N/A
|
|
We are currently evaluating the impact that the standard will have on our consolidated financial statements. We are also evaluating our lease portfolio, software packages, process and policy change requirements. We anticipate that most of our operating leases will result in the recognition of additional assets and corresponding liabilities in our Consolidated Balance Sheet, however we do not expect the standard to have a material impact on our financial position. The actual impact will depend on our lease portfolio at the time of adoption. More information regarding our total operating lease commitments at March 31, 2018, is disclosed in Note 5, "Property, Plant and Equipment".
|
ASU 2016-13, "Measurement of Credit Losses on Financial Instruments"
|
|
June 2016
|
|
The standard requires a financial asset (or group of financial assets) measured at amortized cost to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. Credit losses relating to available-for-sale debt securities should be recorded through an allowance for credit losses. The standard is effective for annual periods beginning after December 15, 2019. Early adoption is permitted.
|
|
N/A
|
|
We are in the process of evaluating the impact that the standard will have on our consolidated financial statements.
|
ASU 2016-15, "Statement of Cash Flows"
(Topic 230)
|
|
August 2016
|
|
This standard provides guidance on the following specific cash flow issues: Debt prepayment or debt extinguishment costs, settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of borrowing, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, distributions received from equity method investees, beneficial interests in securitization transactions, and separately identifiable cash flows and application of the predominance principle. The standard is effective for annual periods beginning after December 15, 2017 and interim periods within that period. Early adoption is permitted.
|
|
N/A
|
|
The impact that the standard will have will depend on the future occurrence of the relevant transactions or conditions addressed by the standard.
|
ASU 2016-16, "Income Taxes, Intra-Entity Transfers of Assets Other Than Inventory"
(Topic 740)
|
|
October 2016
|
|
The standard improves the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. The new standard requires the recognition of income tax consequences resulting from an intra-entity transfer of an asset other than inventory when the transfer occurs. The standard is effective for annual periods beginning after December 15, 2017. Early adoption is permitted.
|
|
N/A
|
|
We are in the process of evaluating the impact that the standard will have on our consolidated financial statements. The impact will depend on the value of future intra-entity transfers.
|
ASU 2017-07
"Compensation - Retirement Benefits - Improving the Presentation of Net Periodic Pension and Net Periodic Postretirement Benefit Cost"
(Topic 715)
|
|
March 2017
|
|
This standard requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside the subtotal of income from operations, if one is presented. The standard is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted.
|
|
N/A
|
|
The adoption of this standard is not expected to have a material impact on our consolidated financial statements as it principally relates to classification of costs within our Consolidated Statements of Income. The components of our net periodic benefit costs are disclosed in Note 9, "Benefit Plans".
|
ASU 2017-09 "Compensation - Stock Compensation" (Topic 718)
|
|
May 2017
|
|
The standard provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. This standard is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted.
|
|
N/A
|
|
The impact will depend on the future occurrence of the relevant terms or conditions addressed by the standard.
|
ASU 2017-12 "Targeted Improvements to Accounting for Hedging Activities" (Topic 815)
|
|
August 2017
|
|
The standard provides targeted improvements to accounting for hedging activities by expanding an entity’s ability to hedge non-financial and financial risk components and reduce complexity in fair value hedges of interest rate risk. The guidance eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also eases certain documentation and assessment requirements and modifies the accounting for components excluded from the assessment of hedge effectiveness. The standard is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted in any interim period after issuance of the standard. The standard should be applied using a modified retrospective approach for cash flow and net investment hedge relationships that exist on the date of adoption, and prospectively for presentation and disclosure requirements.
|
|
N/A
|
|
We do not expect this standard to have a material impact on our consolidated financial statements.
|
ASU 2018-02
"Income Statement - Reporting Comprehensive Income" (Topic 220)
|
|
February 2018
|
|
The standard allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act and requires certain disclosures about stranded tax effects. The underlying guidance requiring that the effect of a change in tax laws or rates be in included in income form continuing operations is not affected. This standard is effective for fiscal years beginning after December 15, 2018 and interim periods within those years. Early adoption is permitted.
|
|
N/A
|
|
We are in the process of evaluating the impact that the standard will have on our consolidated financial statements.
|
|
|
Fiscal Year Ending
|
||
Amounts are unaudited
|
|
March 31, 2016
|
||
Net revenues
|
|
$
|
2,619,056
|
|
Net income from continuing operations
|
|
188,269
|
|
|
Fiscal Year 2018
|
|
Fiscal Year 2017
|
|
Fiscal Year 2016
|
||||||||||||||||||||||||||
(dollars in thousands)
|
All Acquisitions
(1)
|
|
Medisafe
|
|
Compass
|
|
Phoenix Surgical and Endo-Tek
|
|
Synergy Health plc
|
|
Gepco
|
|
Black Diamond
|
|
Other Acquisitions
|
||||||||||||||||
Cash
|
$
|
235
|
|
|
$
|
3,751
|
|
|
$
|
—
|
|
|
$
|
769
|
|
|
$
|
53,057
|
|
|
$
|
1,108
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Accounts receivable
|
1,464
|
|
|
3,634
|
|
|
629
|
|
|
1,123
|
|
|
103,093
|
|
|
4,161
|
|
|
2,966
|
|
|
3,859
|
|
||||||||
Inventory
|
2,289
|
|
|
2,454
|
|
|
659
|
|
|
950
|
|
|
30,074
|
|
|
1,926
|
|
|
3,309
|
|
|
1,108
|
|
||||||||
Property, plant and equipment
|
3,420
|
|
|
639
|
|
|
13
|
|
|
1,092
|
|
|
496,555
|
|
|
3,421
|
|
|
607
|
|
|
1,979
|
|
||||||||
Other assets
|
126
|
|
|
—
|
|
|
31
|
|
|
46
|
|
|
19,175
|
|
|
946
|
|
|
54
|
|
|
—
|
|
||||||||
Intangible assets
|
15,318
|
|
|
17,151
|
|
|
5,992
|
|
|
7,824
|
|
|
504,196
|
|
|
61,900
|
|
|
13,500
|
|
|
14,829
|
|
||||||||
Goodwill
|
35,766
|
|
|
19,599
|
|
|
8,987
|
|
|
5,938
|
|
|
1,685,524
|
|
|
104,485
|
|
|
31,792
|
|
|
20,630
|
|
||||||||
Total Assets
|
58,618
|
|
|
47,228
|
|
|
16,311
|
|
|
17,742
|
|
|
2,891,674
|
|
|
177,947
|
|
|
52,228
|
|
|
42,405
|
|
||||||||
Current liabilities
|
(2,833
|
)
|
|
(5,562
|
)
|
|
(309
|
)
|
|
(1,373
|
)
|
|
(107,932
|
)
|
|
(1,473
|
)
|
|
(4,525
|
)
|
|
(1,277
|
)
|
||||||||
Long-term indebtedness
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(321,082
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Non-current liabilities
|
(2,622
|
)
|
|
(3,398
|
)
|
|
—
|
|
|
(1,263
|
)
|
|
(159,112
|
)
|
|
—
|
|
|
(1,548
|
)
|
|
(49
|
)
|
||||||||
Total Liabilities
|
(5,455
|
)
|
|
(8,960
|
)
|
|
(309
|
)
|
|
(2,636
|
)
|
|
(588,126
|
)
|
|
(1,473
|
)
|
|
(6,073
|
)
|
|
(1,326
|
)
|
||||||||
Net Assets
|
$
|
53,163
|
|
|
$
|
38,268
|
|
|
$
|
16,002
|
|
|
$
|
15,106
|
|
|
$
|
2,303,548
|
|
|
$
|
176,474
|
|
|
$
|
46,155
|
|
|
$
|
41,079
|
|
|
|
Healthcare Products
Segment
|
|
Healthcare Specialty Services Segment
|
|
Life Sciences
Segment
|
|
Applied Sterilization Technologies Segment
|
|
Synergy Combination
|
|
Total
|
||||||||||||
Balance at March 31, 2016
|
|
363,770
|
|
|
154,272
|
|
|
147,334
|
|
|
83,035
|
|
|
1,408,192
|
|
|
2,156,603
|
|
||||||
Goodwill acquired or allocated
|
|
19,618
|
|
|
21,781
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41,399
|
|
||||||
Synergy allocation
|
|
—
|
|
|
376,807
|
|
|
—
|
|
|
1,308,717
|
|
|
(1,411,781
|
)
|
|
273,743
|
|
||||||
Divestitures
|
|
—
|
|
|
(85,806
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(85,806
|
)
|
||||||
Impairment
|
|
—
|
|
|
(58,356
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(58,356
|
)
|
||||||
Foreign currency translation adjustments
|
|
(5,623
|
)
|
|
(32,819
|
)
|
|
(820
|
)
|
|
(60,607
|
)
|
|
3,589
|
|
|
(96,280
|
)
|
||||||
Balance at March 31, 2017
|
|
$
|
377,765
|
|
|
$
|
375,879
|
|
|
$
|
146,514
|
|
|
$
|
1,331,145
|
|
|
$
|
—
|
|
|
$
|
2,231,303
|
|
Goodwill acquired or allocated
|
|
16,418
|
|
|
3,501
|
|
|
—
|
|
|
15,847
|
|
|
—
|
|
|
35,766
|
|
||||||
Reassignment
|
|
—
|
|
|
(1,855
|
)
|
|
—
|
|
|
1,855
|
|
|
—
|
|
|
—
|
|
||||||
Foreign currency translation adjustments
|
|
10,491
|
|
|
10,500
|
|
|
2,302
|
|
|
143,422
|
|
|
—
|
|
|
166,715
|
|
||||||
Balance at March 31, 2018
|
|
$
|
404,674
|
|
|
$
|
388,025
|
|
|
$
|
148,816
|
|
|
$
|
1,492,269
|
|
|
$
|
—
|
|
|
$
|
2,433,784
|
|
|
|
2018
|
|
2017
|
||||||||||||
March 31,
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Customer relationships
|
|
$
|
663,532
|
|
|
$
|
150,358
|
|
|
$
|
597,386
|
|
|
$
|
96,648
|
|
Non-compete agreements
|
|
4,738
|
|
|
3,790
|
|
|
4,722
|
|
|
3,629
|
|
||||
Patents and technology
|
|
226,318
|
|
|
107,598
|
|
|
211,812
|
|
|
86,665
|
|
||||
Trademarks and tradenames
|
|
83,509
|
|
|
36,864
|
|
|
80,223
|
|
|
32,547
|
|
||||
Supplier relationships
|
|
54,800
|
|
|
7,307
|
|
|
54,800
|
|
|
4,567
|
|
||||
Other
|
|
10
|
|
|
10
|
|
|
10
|
|
|
10
|
|
||||
Total
|
|
$
|
1,032,907
|
|
|
$
|
305,927
|
|
|
$
|
948,953
|
|
|
$
|
224,066
|
|
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2022
|
||||||||||
Estimated amortization expense
|
|
$
|
68,447
|
|
|
$
|
67,390
|
|
|
$
|
66,742
|
|
|
$
|
63,832
|
|
|
$
|
59,061
|
|
March 31,
|
|
2018
|
|
2017
|
||||
Raw materials
|
|
$
|
83,741
|
|
|
$
|
65,300
|
|
Work in process
|
|
34,904
|
|
|
26,538
|
|
||
Finished goods
|
|
124,005
|
|
|
140,559
|
|
||
LIFO reserve
|
|
(17,280
|
)
|
|
(16,706
|
)
|
||
Reserve for excess and obsolete inventory
|
|
(19,639
|
)
|
|
(17,854
|
)
|
||
Inventories, net
|
|
$
|
205,731
|
|
|
$
|
197,837
|
|
March 31,
|
|
2018
|
|
2017
|
||||
Land and land improvements
(1)
|
|
$
|
55,417
|
|
|
$
|
46,848
|
|
Buildings and leasehold improvements
|
|
449,316
|
|
|
393,692
|
|
||
Machinery and equipment
|
|
575,607
|
|
|
508,247
|
|
||
Information systems
|
|
145,726
|
|
|
119,920
|
|
||
Radioisotope
|
|
476,578
|
|
|
436,787
|
|
||
Construction in progress
(1)
|
|
87,745
|
|
|
77,421
|
|
||
Total property, plant, and equipment
|
|
1,790,389
|
|
|
1,582,915
|
|
||
Less: accumulated depreciation and depletion
|
|
(779,865
|
)
|
|
(667,007
|
)
|
||
Property, plant, and equipment, net
|
|
$
|
1,010,524
|
|
|
$
|
915,908
|
|
|
|
Operating
Leases
|
||
2019
|
|
$
|
24,116
|
|
2020
|
|
19,933
|
|
|
2021
|
|
14,666
|
|
|
2022
|
|
11,051
|
|
|
2023 and thereafter
|
|
39,464
|
|
|
Total minimum lease payments
|
|
$
|
109,230
|
|
|
|
Asset Retirement Obligations
|
||
Balance at March 31, 2017
|
|
$
|
9,953
|
|
Liabilities incurred during the period
|
|
89
|
|
|
Liabilities settled during the period
|
|
(352
|
)
|
|
Accretion expense
|
|
1,198
|
|
|
Foreign currency movement
|
|
751
|
|
|
Balance at March 31, 2018
|
|
$
|
11,639
|
|
|
|
2018
|
|
2017
|
||||
Credit Agreement and Swing Line Facility
|
|
$
|
331,206
|
|
|
$
|
521,604
|
|
Private Placement
|
|
988,190
|
|
|
960,684
|
|
||
Deferred financing fees
|
|
(3,395
|
)
|
|
(3,927
|
)
|
||
Total long term debt
|
|
$
|
1,316,001
|
|
|
$
|
1,478,361
|
|
|
|
Applicable Note Purchase Agreement
|
|
Maturity Date
|
|
U.S. Dollar Value at March 31, 2018
|
|
U.S. Dollar Value at March 31, 2017
|
||||
$85,000 Senior notes at 6.33%
|
|
2008 Private Placement
|
|
August 2018
|
|
$
|
85,000
|
|
|
$
|
85,000
|
|
$35,000 Senior notes at 6.43%
|
|
2008 Private Placement
|
|
August 2020
|
|
35,000
|
|
|
35,000
|
|
||
$91,000 Senior notes at 3.20%
|
|
2012 Private Placement
|
|
December 2022
|
|
91,000
|
|
|
91,000
|
|
||
$80,000 Senior notes at 3.35%
|
|
2012 Private Placement
|
|
December 2024
|
|
80,000
|
|
|
80,000
|
|
||
$25,000 Senior notes at 3.55%
|
|
2012 Private Placement
|
|
December 2027
|
|
25,000
|
|
|
25,000
|
|
||
$125,000 Senior notes at 3.45%
|
|
2015 Private Placement
|
|
May 2025
|
|
125,000
|
|
|
125,000
|
|
||
$125,000 Senior notes at 3.55%
|
|
2015 Private Placement
|
|
May 2027
|
|
125,000
|
|
|
125,000
|
|
||
$100,000 Senior notes at 3.70%
|
|
2015 Private Placement
|
|
May 2030
|
|
100,000
|
|
|
100,000
|
|
||
$50,000 Senior notes at 3.93%
|
|
2017 Private Placement
|
|
February 2027
|
|
50,000
|
|
|
50,000
|
|
||
€60,000 Senior notes at 1.86%
|
|
2017 Private Placement
|
|
February 2027
|
|
73,912
|
|
|
64,414
|
|
||
$45,000 Senior notes at 4.03%
|
|
2017 Private Placement
|
|
February 2029
|
|
45,000
|
|
|
45,000
|
|
||
€20,000 Senior notes at 2.04%
|
|
2017 Private Placement
|
|
February 2029
|
|
24,637
|
|
|
21,472
|
|
||
£45,000 Senior notes at 3.04%
|
|
2017 Private Placement
|
|
February 2029
|
|
63,141
|
|
|
56,040
|
|
||
€19,000 Senior notes at 2.30%
|
|
2017 Private Placement
|
|
February 2032
|
|
23,406
|
|
|
20,398
|
|
||
£30,000 Senior notes at 3.17%
|
|
2017 Private Placement
|
|
February 2032
|
|
42,094
|
|
|
37,360
|
|
||
Total Senior Notes
|
|
|
|
|
|
$
|
988,190
|
|
|
$
|
960,684
|
|
2019
|
$
|
85,000
|
|
2020
|
—
|
|
|
2021
|
35,000
|
|
|
2022
|
—
|
|
|
2023 and thereafter
|
1,199,396
|
|
|
Total
|
$
|
1,319,396
|
|
March 31,
|
|
2018
|
|
2017
|
||||
Accrued payroll and other related liabilities:
|
|
|
|
|
||||
Compensation and related items
|
|
$
|
30,270
|
|
|
$
|
29,777
|
|
Accrued vacation/paid time off
|
|
11,011
|
|
|
8,651
|
|
||
Accrued bonuses
|
|
31,716
|
|
|
20,715
|
|
||
Accrued employee commissions
|
|
17,168
|
|
|
16,201
|
|
||
Other post-retirement benefits obligations-current portion
|
|
1,906
|
|
|
2,187
|
|
||
Other employee benefit plans' obligations-current portion
|
|
1,929
|
|
|
1,044
|
|
||
Total accrued payroll and other related liabilities
|
|
$
|
94,000
|
|
|
$
|
78,575
|
|
Accrued expenses and other:
|
|
|
|
|
||||
Deferred revenues
|
|
$
|
74,698
|
|
|
$
|
71,020
|
|
Self-insured risk reserves-current portion
|
|
7,349
|
|
|
6,633
|
|
||
Accrued dealer commissions
|
|
16,121
|
|
|
16,122
|
|
||
Accrued warranty
|
|
6,872
|
|
|
6,861
|
|
||
Asset retirement obligation-current portion
|
|
1,798
|
|
|
—
|
|
||
Other
|
|
61,379
|
|
|
54,253
|
|
||
Total accrued expenses and other
|
|
$
|
168,217
|
|
|
$
|
154,889
|
|
Other liabilities:
|
|
|
|
|
||||
Self-insured risk reserves-long-term portion
|
|
$
|
15,008
|
|
|
$
|
15,584
|
|
Other post-retirement benefits obligations-long-term portion
|
|
12,194
|
|
|
13,821
|
|
||
Defined benefit pension plans obligations-long-term portion
|
|
29,407
|
|
|
27,234
|
|
||
Other employee benefit plans obligations-long-term portion
|
|
3,221
|
|
|
3,661
|
|
||
Accrued long-term income taxes
|
|
18,922
|
|
|
2,089
|
|
||
Asset retirement obligation-long-term portion
|
|
9,841
|
|
|
9,953
|
|
||
Other
|
|
20,007
|
|
|
10,331
|
|
||
Total other liabilities
|
|
$
|
108,600
|
|
|
$
|
82,673
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
United States operations
|
|
$
|
203,872
|
|
|
$
|
189,429
|
|
|
$
|
105,758
|
|
United Kingdom operations
|
|
3,253
|
|
|
(36,420
|
)
|
|
(20,553
|
)
|
|||
Other locations operations
|
|
147,857
|
|
|
31,637
|
|
|
86,679
|
|
|||
|
|
$
|
354,982
|
|
|
$
|
184,646
|
|
|
$
|
171,884
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
Current:
|
|
|
|
|
|
|
||||||
United States federal
|
|
$
|
47,728
|
|
|
$
|
43,900
|
|
|
$
|
41,653
|
|
United States state and local
|
|
7,727
|
|
|
8,171
|
|
|
7,943
|
|
|||
United Kingdom
|
|
6,671
|
|
|
362
|
|
|
2,194
|
|
|||
Other locations
|
|
22,667
|
|
|
21,094
|
|
|
13,924
|
|
|||
|
|
84,793
|
|
|
73,527
|
|
|
65,714
|
|
|||
Deferred:
|
|
|
|
|
|
|
||||||
United States federal
|
|
(15,728
|
)
|
|
10,293
|
|
|
1,427
|
|
|||
United States state and local
|
|
2,656
|
|
|
2,131
|
|
|
299
|
|
|||
United Kingdom
|
|
(2,968
|
)
|
|
(2,292
|
)
|
|
(6,973
|
)
|
|||
Other locations
|
|
(5,393
|
)
|
|
(9,644
|
)
|
|
(168
|
)
|
|||
|
|
(21,433
|
)
|
|
488
|
|
|
(5,415
|
)
|
|||
Total Provision for Income Taxes
|
|
$
|
63,360
|
|
|
$
|
74,015
|
|
|
$
|
60,299
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
|||
National statutory tax rate
|
|
19.0
|
%
|
|
20.0
|
%
|
|
35.0
|
%
|
Increase in accruals for uncertain tax positions
|
|
0.1
|
%
|
|
0.3
|
%
|
|
0.2
|
%
|
U.S. state and local taxes, net of federal income tax benefit
|
|
2.3
|
%
|
|
3.8
|
%
|
|
3.3
|
%
|
Increase in valuation allowances
|
|
0.1
|
%
|
|
0.1
|
%
|
|
1.0
|
%
|
U.S. research and development credit
|
|
(0.5
|
)%
|
|
(1.1
|
)%
|
|
—
|
%
|
U.S. foreign income tax credit
|
|
(0.2
|
)%
|
|
—
|
%
|
|
(0.6
|
)%
|
Difference in non-United States tax rates
|
|
—
|
%
|
|
—
|
%
|
|
(8.5
|
)%
|
Difference in non-United Kingdom tax rates
|
|
4.1
|
%
|
|
6.0
|
%
|
|
—
|
%
|
Excise tax gross-up
|
|
—
|
%
|
|
—
|
%
|
|
3.4
|
%
|
U.S. manufacturing deduction
|
|
(0.8
|
)%
|
|
(2.5
|
)%
|
|
(2.5
|
)%
|
Excess tax benefit for equity compensation
|
|
(1.8
|
)%
|
|
(2.8
|
)%
|
|
—
|
%
|
Tax rate changes on deferred tax assets and liabilities
|
|
(10.3
|
)%
|
|
(2.3
|
)%
|
|
—
|
%
|
U.S. transition tax on foreign earnings
|
|
4.9
|
%
|
|
—
|
%
|
|
—
|
%
|
Acquisitions and divestitures
|
|
0.5
|
%
|
|
9.0
|
%
|
|
—
|
%
|
Goodwill impairment on divestitures
|
|
—
|
%
|
|
7.9
|
%
|
|
—
|
%
|
Capitalized acquisition costs
|
|
—
|
%
|
|
0.2
|
%
|
|
5.3
|
%
|
All other, net
|
|
0.4
|
%
|
|
1.5
|
%
|
|
(1.5
|
)%
|
Total Provision for Income Taxes
|
|
17.8
|
%
|
|
40.1
|
%
|
|
35.1
|
%
|
|
|
2018
|
|
2017
|
||||
Unrecognized Tax Benefits Balance at April 1
|
|
$
|
1,884
|
|
|
$
|
3,527
|
|
Increases for tax provisions of current year
|
|
356
|
|
|
510
|
|
||
Balances related to acquired/disposed businesses
|
|
—
|
|
|
(1,502
|
)
|
||
Other, including currency translation
|
|
260
|
|
|
(651
|
)
|
||
Unrecognized Tax Benefits Balance at March 31
|
|
$
|
2,500
|
|
|
$
|
1,884
|
|
March 31,
|
|
2018
|
|
2017
|
||||
Deferred Tax Assets:
|
|
|
|
|
||||
Post-retirement benefit accrual
|
|
$
|
3,505
|
|
|
$
|
6,116
|
|
Compensation
|
|
12,334
|
|
|
17,196
|
|
||
Net operating loss carryforwards
|
|
26,217
|
|
|
35,129
|
|
||
Accrued expenses
|
|
5,795
|
|
|
7,807
|
|
||
Insurance
|
|
3,417
|
|
|
4,957
|
|
||
Deferred income
|
|
4,632
|
|
|
8,962
|
|
||
Bad debt
|
|
1,426
|
|
|
1,740
|
|
||
Pension
|
|
5,247
|
|
|
4,647
|
|
||
Other
|
|
1,668
|
|
|
781
|
|
||
Deferred Tax Assets
|
|
64,241
|
|
|
87,335
|
|
||
Less: Valuation allowance
|
|
13,596
|
|
|
16,366
|
|
||
Total Deferred Tax Assets
|
|
50,645
|
|
|
70,969
|
|
||
Deferred Tax Liabilities:
|
|
|
|
|
||||
Depreciation and depletion
|
|
61,171
|
|
|
74,092
|
|
||
Intangibles
|
|
140,398
|
|
|
156,291
|
|
||
Other
|
|
2,774
|
|
|
3,631
|
|
||
Total Deferred Tax Liabilities
|
|
204,343
|
|
|
234,014
|
|
||
Net Deferred Tax Assets (Liabilities)
|
|
$
|
(153,698
|
)
|
|
$
|
(163,045
|
)
|
|
Other Defined Benefit Pension Plans
|
|
Other
Post-Retirement
Benefits Plan
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Change in Benefit Obligations:
|
|
|
|
|
|
|
|
||||||||
Benefit Obligations at Beginning of Year
|
$
|
128,897
|
|
|
$
|
128,942
|
|
|
$
|
16,008
|
|
|
$
|
18,380
|
|
Obligation assumed in business acquisition
|
3,843
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Service cost
|
2,402
|
|
|
1,650
|
|
|
—
|
|
|
—
|
|
||||
Interest cost
|
3,262
|
|
|
3,434
|
|
|
519
|
|
|
554
|
|
||||
Actuarial loss (gain)
|
(697
|
)
|
|
16,633
|
|
|
(501
|
)
|
|
(531
|
)
|
||||
Benefits and expenses
|
(6,075
|
)
|
|
(7,190
|
)
|
|
(1,926
|
)
|
|
(2,395
|
)
|
||||
Employee contributions
|
765
|
|
|
629
|
|
|
—
|
|
|
—
|
|
||||
Impact of foreign currency exchange rate changes
|
16,451
|
|
|
(15,201
|
)
|
|
—
|
|
|
—
|
|
||||
Benefit Obligations at End of Year
|
148,848
|
|
|
128,897
|
|
|
14,100
|
|
|
16,008
|
|
||||
Change in Plan Assets:
|
|
|
|
|
|
|
|
||||||||
Fair Value of Plan Assets at Beginning of Year
|
101,663
|
|
|
104,353
|
|
|
—
|
|
|
—
|
|
||||
Assets assumed in business acquisition
|
4,462
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Actual return on plan assets
|
1,052
|
|
|
11,910
|
|
|
—
|
|
|
—
|
|
||||
Employer contributions
|
5,150
|
|
|
4,838
|
|
|
1,926
|
|
|
2,395
|
|
||||
Employee contributions
|
765
|
|
|
629
|
|
|
—
|
|
|
—
|
|
||||
Benefits and expenses paid
|
(6,078
|
)
|
|
(7,190
|
)
|
|
(1,926
|
)
|
|
(2,395
|
)
|
||||
Impact of foreign currency exchange rate changes
|
12,427
|
|
|
(12,877
|
)
|
|
—
|
|
|
—
|
|
||||
Fair Value of Plan Assets at End of Year
|
119,441
|
|
|
101,663
|
|
|
—
|
|
|
—
|
|
||||
Funded Status of the Plans
|
$
|
(29,407
|
)
|
|
$
|
(27,234
|
)
|
|
$
|
(14,100
|
)
|
|
$
|
(16,008
|
)
|
|
|
Other Defined Benefit Pension Plans
|
|
Other Post-Retirement Benefits Plan
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Current liabilities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1,906
|
)
|
|
$
|
(2,187
|
)
|
Noncurrent liabilities
|
|
(29,407
|
)
|
|
(27,234
|
)
|
|
(12,194
|
)
|
|
(13,821
|
)
|
||||
|
|
$
|
(29,407
|
)
|
|
$
|
(27,234
|
)
|
|
$
|
(14,100
|
)
|
|
$
|
(16,008
|
)
|
|
|
Defined Benefit Pension Plans
|
|
Other Post-Retirement
Benefits Plan
|
||||
Actuarial loss
|
|
$
|
507
|
|
|
$
|
648
|
|
Prior Service Cost
|
|
—
|
|
|
(3,263
|
)
|
|
|
Other Defined Benefit Pension Plans
|
||||||
|
|
2018
|
|
2017
|
||||
Aggregate fair value of plan assets
|
|
$
|
119,441
|
|
|
$
|
101,663
|
|
Aggregate accumulated benefit obligations
|
|
148,848
|
|
|
128,897
|
|
||
Aggregate projected benefit obligations
|
|
148,848
|
|
|
128,897
|
|
|
|
Other Defined Benefit Pension Plans
|
|
Other Post-Retirement Benefits Plan
|
|
AMSCO Plan
|
|||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2018
|
|
2017
|
|
2016
|
|
2018
|
|
2017
|
2016
|
||||||||||||||||||
Service cost
|
|
$
|
2,402
|
|
|
$
|
1,650
|
|
|
$
|
961
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
27
|
|
Interest cost
|
|
3,262
|
|
|
3,434
|
|
|
1,659
|
|
|
519
|
|
|
554
|
|
|
593
|
|
|
—
|
|
|
—
|
|
560
|
|
|||||||||
Expected return on plan assets
|
|
(4,835
|
)
|
|
(2,853
|
)
|
|
(1,324
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(1,008
|
)
|
|||||||||
Prior service cost recognition
|
|
—
|
|
|
—
|
|
|
(142
|
)
|
|
(3,263
|
)
|
|
(3,263
|
)
|
|
(3,263
|
)
|
|
—
|
|
|
—
|
|
—
|
|
|||||||||
Net amortization and deferral
|
|
126
|
|
|
—
|
|
|
—
|
|
|
648
|
|
|
739
|
|
|
828
|
|
|
—
|
|
|
—
|
|
602
|
|
|||||||||
Curtailments/settlements
|
|
—
|
|
|
—
|
|
|
(326
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
26,470
|
|
|||||||||
Net periodic benefit cost
|
|
$
|
955
|
|
|
$
|
2,231
|
|
|
$
|
828
|
|
|
$
|
(2,096
|
)
|
|
$
|
(1,970
|
)
|
|
$
|
(1,842
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
26,651
|
|
Recognized in other comprehensive loss (income) before tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net loss (gain) occurring during year
|
|
$
|
(697
|
)
|
|
$
|
(7,553
|
)
|
|
$
|
(3,733
|
)
|
|
$
|
501
|
|
|
$
|
531
|
|
|
$
|
673
|
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
—
|
|
Amortization of prior service credit
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,263
|
|
|
3,263
|
|
|
3,263
|
|
|
—
|
|
|
—
|
|
—
|
|
|||||||||
Amortization of net loss
|
|
(126
|
)
|
|
—
|
|
|
—
|
|
|
(648
|
)
|
|
(739
|
)
|
|
(721
|
)
|
|
—
|
|
|
—
|
|
(602
|
)
|
|||||||||
Total recognized in other comprehensive loss (income)
|
|
(823
|
)
|
|
(7,553
|
)
|
|
(3,733
|
)
|
|
3,116
|
|
|
3,055
|
|
|
3,215
|
|
|
—
|
|
|
—
|
|
(602
|
)
|
|||||||||
Total recognized in total benefits cost and other comprehensive loss (income)
|
|
$
|
132
|
|
|
$
|
(5,322
|
)
|
|
$
|
(2,905
|
)
|
|
$
|
1,020
|
|
|
$
|
1,085
|
|
|
$
|
1,373
|
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
26,049
|
|
|
|
2018
|
|
2017
|
||
Discount Rate:
|
|
|
|
|
||
Synergy Health plc Retirement Benefits Scheme
|
|
2.50
|
%
|
|
2.60
|
%
|
Isotron BV Pension Plan
|
|
1.60
|
%
|
|
1.60
|
%
|
Synergy Health Daniken AG
|
|
0.95
|
%
|
|
0.65
|
%
|
Synergy Health Radeberg
|
|
1.60
|
%
|
|
1.50
|
%
|
Synergy Health Allershausen
|
|
1.60
|
%
|
|
1.50
|
%
|
Harwell Dosimeters Ltd Retirement Benefits Scheme
|
|
2.55
|
%
|
|
n/a
|
|
Other post-retirement plan
|
|
3.50
|
%
|
|
3.50
|
%
|
|
|
2018
|
|
2017
|
|
2016
|
|||
Discount Rate:
|
|
|
|
|
|
|
|||
Defined benefit pension plans
|
|
|
|
|
|
|
|||
Synergy Health plc Retirement Benefits Scheme
|
|
2.60
|
%
|
|
3.50
|
%
|
|
3.20
|
%
|
Isotron BV Pension Plan
|
|
1.60
|
%
|
|
1.60
|
%
|
|
2.10
|
%
|
Synergy Health Daniken AG
|
|
0.65
|
%
|
|
0.65
|
%
|
|
0.40
|
%
|
Synergy Health Radeberg
|
|
1.50
|
%
|
|
1.50
|
%
|
|
1.60
|
%
|
Synergy Health Allershausen
|
|
1.50
|
%
|
|
1.50
|
%
|
|
1.60
|
%
|
Harwell Dosimeters Ltd Retirement Benefits Scheme
|
|
2.55
|
%
|
|
n/a
|
|
|
n/a
|
|
Other post-retirement plan
|
|
3.50
|
%
|
|
3.50
|
%
|
|
3.25
|
%
|
Expected Return on Plan Assets:
|
|
|
|
|
|
|
|||
Synergy Health plc Retirement Benefits Scheme
|
|
4.97
|
%
|
|
4.87
|
%
|
|
5.19
|
%
|
Isotron BV Pension Plan
|
|
1.60
|
%
|
|
1.60
|
%
|
|
2.10
|
%
|
Synergy Health Daniken AG
|
|
1.40
|
%
|
|
1.40
|
%
|
|
1.40
|
%
|
|
|
2018
|
|
2017
|
|
2016
|
|||
Healthcare cost trend rate – medical
|
|
7.0
|
%
|
|
7.0
|
%
|
|
7.0
|
%
|
Healthcare cost trend rate – prescription drug
|
|
7.0
|
%
|
|
7.0
|
%
|
|
7.0
|
%
|
Long-term healthcare cost trend rate
|
|
4.5
|
%
|
|
4.5
|
%
|
|
4.5
|
%
|
|
|
One-Percentage Point
|
||||||
|
|
Increase
|
|
Decrease
|
||||
Effect on total service and interest cost components
|
|
$
|
1
|
|
|
$
|
(1
|
)
|
Effect on other post-retirement benefit obligation
|
|
21
|
|
|
(20
|
)
|
|
|
Fair Value Measurements at March 31, 2018
|
||||||||||||||
(In thousands)
|
|
Total
|
|
Quoted
Prices in
Active Markets
for Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Other
Unobservable
Inputs
(Level 3)
|
||||||||
Cash
|
|
$
|
67
|
|
|
$
|
67
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Insured annuities
|
|
15,228
|
|
|
—
|
|
|
15,228
|
|
|
—
|
|
||||
Insurance contracts
|
|
5,484
|
|
|
—
|
|
|
—
|
|
|
5,484
|
|
||||
Common and collective trusts valued at net asset value:
|
|
|
|
|
|
|
|
|
||||||||
Equity security trusts
|
|
74,081
|
|
|
|
|
|
|
|
|||||||
Debt security trusts
|
|
24,581
|
|
|
|
|
|
|
|
|||||||
Total Plan Assets
|
|
$
|
119,441
|
|
|
$
|
67
|
|
|
$
|
15,228
|
|
|
$
|
5,484
|
|
|
|
Fair Value Measurements at March 31, 2017
|
||||||||||||||
(In thousands)
|
|
Total
|
|
Quoted
Prices in
Active Markets
for Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Other
Unobservable
Inputs
(Level 3)
|
||||||||
Cash
|
|
$
|
182
|
|
|
$
|
182
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Insured annuities
|
|
10,813
|
|
|
—
|
|
|
10,813
|
|
|
—
|
|
||||
Insurance contracts
|
|
3,959
|
|
|
—
|
|
|
—
|
|
|
3,959
|
|
||||
Common and collective trusts valued at net asset value:
|
|
|
|
|
|
|
|
|
||||||||
Equity security trusts
|
|
64,922
|
|
|
|
|
|
|
|
|||||||
Debt security trusts
|
|
21,787
|
|
|
|
|
|
|
|
|||||||
Total Plan Assets
|
|
$
|
101,663
|
|
|
$
|
182
|
|
|
$
|
10,813
|
|
|
$
|
3,959
|
|
|
|
Insurance contracts
|
||
Balance at March 31, 2016
|
|
$
|
4,192
|
|
Gains (losses) related to assets still held at year-end
|
|
116
|
|
|
Purchases, sales, settlements - net
|
|
(208
|
)
|
|
Foreign currency
|
|
(141
|
)
|
|
Balance at March 31, 2017
|
|
$
|
3,959
|
|
Gains (losses) related to assets still held at year-end
|
|
(43
|
)
|
|
Additions from business acquisition
|
|
2,231
|
|
|
Transfers out of Level 3
|
|
(852
|
)
|
|
Foreign currency
|
|
189
|
|
|
Balance at March 31, 2018
|
|
$
|
5,484
|
|
|
|
Other Defined Benefit Pension Plans
|
|
Other Post-Retirement Benefits Plan
|
||||
2019
|
|
$
|
3,899
|
|
|
$
|
1,907
|
|
2020
|
|
3,903
|
|
|
1,694
|
|
||
2021
|
|
4,143
|
|
|
1,548
|
|
||
2022
|
|
4,608
|
|
|
1,436
|
|
||
2023
|
|
5,611
|
|
|
1,293
|
|
||
2024-2029
|
|
27,108
|
|
|
4,741
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
Revenues:
|
|
|
|
|
|
|
||||||
Healthcare Products
|
|
$
|
1,276,054
|
|
|
$
|
1,266,517
|
|
|
$
|
1,203,884
|
|
Healthcare Specialty Services
|
|
469,065
|
|
|
539,536
|
|
|
421,110
|
|
|||
Life Sciences
|
|
361,590
|
|
|
328,866
|
|
|
297,733
|
|
|||
Applied Sterilization Technologies
|
|
513,287
|
|
|
477,837
|
|
|
316,037
|
|
|||
Total revenues
|
|
$
|
2,619,996
|
|
|
$
|
2,612,756
|
|
|
$
|
2,238,764
|
|
Operating income (loss):
|
|
|
|
|
|
|
||||||
Healthcare Products
|
|
221,795
|
|
|
227,707
|
|
|
181,009
|
|
|||
Healthcare Specialty Services
|
|
28,910
|
|
|
10,573
|
|
|
24,555
|
|
|||
Life Sciences
|
|
106,737
|
|
|
97,180
|
|
|
84,564
|
|
|||
Applied Sterilization Technologies
|
|
173,375
|
|
|
158,379
|
|
|
99,854
|
|
|||
Total reportable segments
|
|
530,817
|
|
|
493,839
|
|
|
389,982
|
|
|||
Corporate
|
|
(17,439
|
)
|
|
(17,307
|
)
|
|
(11,320
|
)
|
|||
Total operating income before adjustments
|
|
$
|
513,378
|
|
|
$
|
476,532
|
|
|
$
|
378,662
|
|
Less: Adjustments
|
|
|
|
|
|
|
||||||
Goodwill impairment loss
(1)
|
|
—
|
|
|
58,356
|
|
|
—
|
|
|||
Amortization of inventory and property "step up" to
fair value
(2)
|
|
1,599
|
|
|
4,743
|
|
|
9,907
|
|
|||
Amortization of purchased intangible assets
(2)
|
|
67,793
|
|
|
66,398
|
|
|
47,704
|
|
|||
Acquisition and integration related transaction charges
(3)
|
|
16,211
|
|
|
30,082
|
|
|
82,891
|
|
|||
Loss (gain) on fair value adjustment of acquisition related contingent consideration
|
|
(593
|
)
|
|
2,569
|
|
|
(736
|
)
|
|||
Net loss on divestiture of businesses
(2)
|
|
14,547
|
|
|
86,574
|
|
|
—
|
|
|||
Settlement of pension obligation
(4)
|
|
—
|
|
|
—
|
|
|
26,470
|
|
|||
Impact of the U.S. Tax Cuts and Jobs Act
(5)
|
|
10,264
|
|
|
—
|
|
|
—
|
|
|||
Restructuring charges
|
|
103
|
|
|
215
|
|
|
(501
|
)
|
|||
Total operating income
|
|
$
|
403,454
|
|
|
$
|
227,595
|
|
|
$
|
212,927
|
|
March 31,
|
|
2018
|
|
2017
|
||||
Assets:
|
|
|
|
|
||||
Healthcare Products and Life Sciences
|
|
$
|
1,621,156
|
|
|
$
|
1,576,923
|
|
Healthcare Specialty Services
|
|
813,909
|
|
|
809,596
|
|
||
Applied Sterilization Technologies
|
|
2,765,269
|
|
|
2,537,936
|
|
||
Total assets
|
|
$
|
5,200,334
|
|
|
$
|
4,924,455
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
Capital Expenditures:
|
|
|
|
|
|
|
||||||
Healthcare Products and Life Sciences
|
|
$
|
52,767
|
|
|
$
|
39,253
|
|
|
$
|
34,581
|
|
Healthcare Specialty Services
|
|
16,497
|
|
|
42,408
|
|
|
31,308
|
|
|||
Applied Sterilization Technologies
|
|
96,193
|
|
|
91,240
|
|
|
60,518
|
|
|||
Total Capital Expenditures
|
|
$
|
165,457
|
|
|
$
|
172,901
|
|
|
$
|
126,407
|
|
Depreciation, Depletion, and Amortization:
|
|
|
|
|
|
|
||||||
Healthcare Products and Life Sciences
|
|
$
|
52,025
|
|
|
$
|
46,709
|
|
|
$
|
49,142
|
|
Healthcare Specialty Services
|
|
29,269
|
|
|
56,860
|
|
|
36,114
|
|
|||
Applied Sterilization Technologies
|
|
97,038
|
|
|
84,573
|
|
|
58,484
|
|
|||
Total Depreciation, Depletion, and Amortization
|
|
$
|
178,332
|
|
|
$
|
188,142
|
|
|
$
|
143,740
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
Revenues:
|
|
|
|
|
|
|
||||||
United Kingdom
|
|
$
|
207,514
|
|
|
$
|
229,603
|
|
|
$
|
144,577
|
|
United States
|
|
1,836,414
|
|
|
1,803,457
|
|
|
1,662,050
|
|
|||
Other locations
|
|
576,068
|
|
|
579,696
|
|
|
432,137
|
|
|||
Total Revenues
|
|
$
|
2,619,996
|
|
|
$
|
2,612,756
|
|
|
$
|
2,238,764
|
|
March 31,
|
|
2018
|
|
2017
|
||||
Property, Plant, and Equipment, Net
|
|
|
|
|
||||
United Kingdom
|
|
$
|
97,586
|
|
|
$
|
76,695
|
|
United States
|
|
530,591
|
|
|
499,760
|
|
||
Other locations
|
|
382,347
|
|
|
339,453
|
|
||
Property, Plant, and Equipment, Net
|
|
$
|
1,010,524
|
|
|
$
|
915,908
|
|
Years ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
|||
Denominator
(
shares in thousands
):
|
|
|
|
|
|
|
|||
Weighted average shares outstanding—basic
|
|
85,028
|
|
|
85,473
|
|
|
70,698
|
|
Dilutive effect of share equivalents
|
|
685
|
|
|
621
|
|
|
486
|
|
Weighted average shares outstanding and share equivalents—diluted
|
|
85,713
|
|
|
86,094
|
|
|
71,184
|
|
Years ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
|||
Number of ordinary share options
(
shares in thousands
)
|
|
393
|
|
|
576
|
|
|
263
|
|
|
|
Fiscal 2018
|
|
Fiscal 2017
|
|
Fiscal 2016
|
|||
Risk-free interest rate
|
|
2.01
|
%
|
|
1.29
|
%
|
|
1.51
|
%
|
Expected life of options
|
|
5.7 years
|
|
|
5.7 years
|
|
|
5.7 years
|
|
Expected dividend yield of stock
|
|
1.58
|
%
|
|
1.54
|
%
|
|
1.40
|
%
|
Expected volatility of stock
|
|
22.08
|
%
|
|
22.92
|
%
|
|
25.06
|
%
|
|
|
Number of
Options
|
|
Weighted
Average
Exercise
Price
|
|
Average
Remaining
Contractual
Term
|
|
Aggregate
Intrinsic
Value
|
|||||
Outstanding at March 31, 2017
|
|
1,945,274
|
|
|
$
|
50.28
|
|
|
|
|
|
||
Granted
|
|
429,360
|
|
|
77.75
|
|
|
|
|
|
|||
Exercised
|
|
(329,733
|
)
|
|
34.01
|
|
|
|
|
|
|||
Forfeited
|
|
(23,239
|
)
|
|
68.29
|
|
|
|
|
|
|||
Outstanding at March 31, 2018
|
|
2,021,662
|
|
|
$
|
58.56
|
|
|
6.6 years
|
|
$
|
70,350
|
|
Exercisable at March 31, 2018
|
|
1,139,722
|
|
|
$
|
48.81
|
|
|
5.3 years
|
|
$
|
50,772
|
|
|
|
Number of
Restricted
Shares
|
|
Number of Restricted Share Units
|
|
Weighted-Average
Grant Date
Fair Value
|
||||
Non-vested at March 31, 2017
|
|
780,526
|
|
|
34,013
|
|
|
$
|
60.87
|
|
Granted
|
|
251,300
|
|
|
23,259
|
|
|
78.60
|
|
|
Vested
|
|
(231,107
|
)
|
|
(21,181
|
)
|
|
54.41
|
|
|
Forfeited
|
|
(37,518
|
)
|
|
(660
|
)
|
|
68.57
|
|
|
Non-vested at March 31, 2018
|
|
763,201
|
|
|
35,431
|
|
|
$
|
68.65
|
|
Years Ended March 31,
|
|
2018
|
|
2017
|
|
2016
|
||||||
Balance, Beginning of Year
|
|
$
|
6,861
|
|
|
$
|
5,909
|
|
|
$
|
5,579
|
|
Warranties issued during the period
|
|
12,305
|
|
|
11,823
|
|
|
11,194
|
|
|||
Settlements made during the period
|
|
(12,294
|
)
|
|
(10,871
|
)
|
|
(10,864
|
)
|
|||
Balance, End of Year
|
|
$
|
6,872
|
|
|
$
|
6,861
|
|
|
$
|
5,909
|
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||
|
|
Fair Value at
|
|
Fair Value at
|
|
Fair Value at
|
|
Fair Value at
|
||||||||
Balance Sheet Location
|
|
March 31, 2018
|
|
March 31, 2017
|
|
March 31, 2018
|
|
March 31, 2017
|
||||||||
Prepaid & Other
|
|
$
|
187
|
|
|
$
|
160
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Accrued expenses and other
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
35
|
|
|
|
Location of (loss) gain recognized in income
|
|
Amount of (loss) gain recognized in income
|
||||||||||
Years Ended March 31,
|
||||||||||||||
2018
|
|
2017
|
|
2016
|
||||||||||
Foreign currency forward contracts
|
|
Selling, general and administrative
|
|
$
|
(1,357
|
)
|
|
$
|
(1,886
|
)
|
|
$
|
(683
|
)
|
Commodity swap contracts
|
|
Cost of revenues
|
|
$
|
373
|
|
|
$
|
376
|
|
|
$
|
(461
|
)
|
|
|
|
|
|
Fair Value Measurements
|
|||||||||||||||||||||||
At March 31,
|
|
Carrying Value
|
|
Quoted Prices
in Active Markets
for Identical Assets
|
|
Significant Other
Observable Inputs
|
|
Significant
Unobservable
Inputs
|
||||||||||||||||||||
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||||||||||||||
|
2018
|
2017
|
|
2018
|
2017
|
|
2018
|
2017
|
|
2018
|
2017
|
|||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Cash and cash equivalents
(1)
|
|
$
|
201,534
|
|
$
|
282,918
|
|
|
$
|
201,534
|
|
$
|
282,918
|
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
—
|
|
Forward and swap contracts
(2)
|
|
187
|
|
160
|
|
|
—
|
|
—
|
|
|
187
|
|
160
|
|
|
—
|
|
—
|
|
||||||||
Investments
(3)
|
|
16,382
|
|
12,552
|
|
|
16,382
|
|
12,552
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Forward and swap contracts
(2)
|
|
$
|
—
|
|
$
|
35
|
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
35
|
|
|
$
|
—
|
|
$
|
—
|
|
Deferred compensation plans
(3)
|
|
1,694
|
|
1,677
|
|
|
1,694
|
|
1,677
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
||||||||
Long term debt
(4)
|
|
1,316,001
|
|
1,478,361
|
|
|
—
|
|
—
|
|
|
1,305,181
|
|
1,496,966
|
|
|
—
|
|
—
|
|
||||||||
Contingent consideration obligations
(5)
|
|
8,068
|
|
4,451
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
8,068
|
|
4,451
|
|
|
|
Contingent Consideration
|
||
Balance at March 31, 2016
|
|
$
|
5,886
|
|
Additions
|
|
3,592
|
|
|
Payments
|
|
(5,416
|
)
|
|
Foreign currency translation adjustments
|
|
389
|
|
|
Balance at March 31, 2017
|
|
$
|
4,451
|
|
Additions
|
|
5,774
|
|
|
Payments
|
|
(1,735
|
)
|
|
Reductions
|
|
(593
|
)
|
|
Foreign currency translation adjustments
|
|
171
|
|
|
Balance at March 31, 2018
|
|
$
|
8,068
|
|
|
|
|
|
|
|
Investments
|
||||||||||||||||||||||||||
At March 31,
|
|
Cost
|
|
Unrealized Gains
(1)
|
|
Unrealized Losses
(1)
|
|
Fair Value
|
||||||||||||||||||||||||
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Marketable equity securities and other
(1)
|
|
$
|
11,037
|
|
|
$
|
11,037
|
|
|
$
|
3,762
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(72
|
)
|
|
$
|
14,799
|
|
|
$
|
10,965
|
|
Mutual funds
|
|
1,000
|
|
|
1,091
|
|
|
583
|
|
|
496
|
|
|
—
|
|
|
—
|
|
|
1,583
|
|
|
1,587
|
|
||||||||
Total available-for-sale securities
|
|
$
|
12,037
|
|
|
$
|
12,128
|
|
|
$
|
4,345
|
|
|
$
|
496
|
|
|
$
|
—
|
|
|
$
|
(72
|
)
|
|
$
|
16,382
|
|
|
$
|
12,552
|
|
Years Ended March 31,
|
|
2018
|
2017
|
2016
|
||||||
Cumulative foreign currency translation adjustment
|
|
$
|
16,457
|
|
$
|
(238,525
|
)
|
$
|
(72,594
|
)
|
Amortization of pension and postretirement benefit plans costs,
net of taxes
|
|
(6,742
|
)
|
(2,355
|
)
|
5,108
|
|
|||
Unrealized gain (loss) on available for sale securities
|
|
1,970
|
|
178
|
|
(673
|
)
|
|||
Total
|
|
$
|
11,685
|
|
$
|
(240,702
|
)
|
$
|
(68,159
|
)
|
|
|
Gain (Loss) on Available for Sale Securities
(1)
|
|
Defined Benefit
Plans
(2)
|
|
Foreign Currency Translation
(3)
|
|
Total Accumulated Other Comprehensive Income (Loss)
|
||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||
Beginning Balance
|
|
$
|
178
|
|
|
$
|
(673
|
)
|
|
$
|
(2,355
|
)
|
|
$
|
5,108
|
|
|
$
|
(238,525
|
)
|
|
$
|
(72,594
|
)
|
|
$
|
(240,702
|
)
|
|
$
|
(68,159
|
)
|
Other Comprehensive Income (Loss) before reclassifications
|
|
1,703
|
|
|
745
|
|
|
(2,291
|
)
|
|
(5,491
|
)
|
|
254,982
|
|
|
(165,931
|
)
|
|
254,394
|
|
|
(170,677
|
)
|
||||||||
Amounts reclassified from Accumulated Other Comprehensive Income (Loss)
|
|
89
|
|
|
106
|
|
|
(2,096
|
)
|
|
(1,972
|
)
|
|
—
|
|
|
—
|
|
|
(2,007
|
)
|
|
(1,866
|
)
|
||||||||
Net current-period Other Comprehensive Income (Loss)
|
|
1,792
|
|
|
851
|
|
|
(4,387
|
)
|
|
(7,463
|
)
|
|
254,982
|
|
|
(165,931
|
)
|
|
252,387
|
|
|
(172,543
|
)
|
||||||||
Ending Balance
|
|
$
|
1,970
|
|
|
$
|
178
|
|
|
$
|
(6,742
|
)
|
|
$
|
(2,355
|
)
|
|
$
|
16,457
|
|
|
$
|
(238,525
|
)
|
|
$
|
11,685
|
|
|
$
|
(240,702
|
)
|
Quarters Ended
|
March 31,
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
||||||||
Fiscal 2018
|
|
|
|
|
|
|
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Product
|
$
|
351,010
|
|
|
$
|
309,461
|
|
|
$
|
286,557
|
|
|
$
|
273,605
|
|
Service
|
364,963
|
|
|
352,439
|
|
|
347,602
|
|
|
334,359
|
|
||||
Total Revenues
|
715,973
|
|
|
661,900
|
|
|
634,159
|
|
|
607,964
|
|
||||
Cost of Revenues:
|
|
|
|
|
|
|
|
||||||||
Product
|
187,710
|
|
|
162,611
|
|
|
152,611
|
|
|
143,245
|
|
||||
Service
|
235,510
|
|
|
220,701
|
|
|
214,787
|
|
|
208,598
|
|
||||
Total Cost of Revenues
|
423,220
|
|
|
383,312
|
|
|
367,398
|
|
|
351,843
|
|
||||
Gross Profit
|
292,753
|
|
|
278,588
|
|
|
266,761
|
|
|
256,121
|
|
||||
Percentage of Revenues
|
40.9
|
%
|
|
42.1
|
%
|
|
42.1
|
%
|
|
42.1
|
%
|
||||
Restructuring Expenses
|
(53
|
)
|
|
78
|
|
|
27
|
|
|
51
|
|
||||
Net Income Attributable to Shareholders
|
$
|
73,598
|
|
|
$
|
94,781
|
|
|
$
|
64,459
|
|
|
$
|
58,077
|
|
Basic Income Per Ordinary Share Attributable to Shareholders:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
0.87
|
|
|
$
|
1.12
|
|
|
$
|
0.76
|
|
|
$
|
0.68
|
|
Diluted Income Per Ordinary Share Attributable to Shareholders:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
0.86
|
|
|
$
|
1.11
|
|
|
$
|
0.75
|
|
|
$
|
0.68
|
|
|
|
|
|
|
|
|
|
||||||||
Fiscal 2017
|
|
|
|
|
|
|
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Product
|
$
|
332,093
|
|
|
$
|
302,260
|
|
|
$
|
292,216
|
|
|
$
|
271,750
|
|
Service
|
349,096
|
|
|
344,514
|
|
|
354,199
|
|
|
366,628
|
|
||||
Total Revenues
|
681,189
|
|
|
646,774
|
|
|
646,415
|
|
|
638,378
|
|
||||
Cost of Revenues:
|
|
|
|
|
|
|
|
||||||||
Product
|
173,333
|
|
|
152,879
|
|
|
155,110
|
|
|
142,698
|
|
||||
Service
|
227,731
|
|
|
236,286
|
|
|
243,397
|
|
|
255,690
|
|
||||
Total Cost of Revenues
|
401,064
|
|
|
389,165
|
|
|
398,507
|
|
|
398,388
|
|
||||
Gross Profit
|
280,125
|
|
|
257,609
|
|
|
247,908
|
|
|
239,990
|
|
||||
Percentage of Revenues
|
41.1
|
%
|
|
39.8
|
%
|
|
38.4
|
%
|
|
37.6
|
%
|
||||
Restructuring Expenses
|
(5
|
)
|
|
18
|
|
|
48
|
|
|
154
|
|
||||
Net Income Attributable to Shareholders
|
$
|
26,143
|
|
|
$
|
(4,996
|
)
|
|
$
|
40,416
|
|
|
$
|
48,401
|
|
Basic Income Per Ordinary Share Attributable to Shareholders:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
0.31
|
|
|
$
|
(0.06
|
)
|
|
$
|
0.47
|
|
|
$
|
0.56
|
|
Diluted Income Per Ordinary Share Attributable to Shareholders:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
0.31
|
|
|
$
|
(0.06
|
)
|
|
$
|
0.47
|
|
|
$
|
0.56
|
|
Description
|
|
Balance at
Beginning
of Period
|
|
Charges
to Costs
and
Expenses
|
|
|
Charges
to Other
Accounts
|
|
|
Deductions
|
|
|
Balance at
End of
Period
|
||||||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended March 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for trade accounts receivable
(1)
|
|
$
|
10,357
|
|
|
$
|
2,183
|
|
|
|
$
|
1,925
|
|
(3)
|
|
$
|
(1,993
|
)
|
(4)
|
|
$
|
12,472
|
|
Inventory valuation reserve
|
|
17,854
|
|
|
2,446
|
|
(2)
|
|
(661
|
)
|
(3)
|
|
—
|
|
|
|
19,639
|
|
|||||
Deferred tax asset valuation allowance
|
|
16,366
|
|
|
3,535
|
|
|
|
209
|
|
(3)
|
|
(6,514
|
)
|
|
|
13,596
|
|
|||||
Recorded within liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Casualty loss reserves
|
|
$
|
22,718
|
|
|
$
|
5,713
|
|
|
|
$
|
(2,563
|
)
|
|
|
$
|
(4,919
|
)
|
|
|
$
|
20,949
|
|
Year ended March 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for trade accounts receivable
(1)
|
|
$
|
11,185
|
|
|
$
|
1,248
|
|
|
|
$
|
11
|
|
(3)
|
|
$
|
(2,087
|
)
|
(4)
|
|
$
|
10,357
|
|
Inventory valuation reserve
|
|
18,707
|
|
|
(171
|
)
|
(2)
|
|
(682
|
)
|
(3)
|
|
—
|
|
|
|
17,854
|
|
|||||
Deferred tax asset valuation allowance
|
|
16,435
|
|
|
4,014
|
|
|
|
(214
|
)
|
(3)
|
|
(3,869
|
)
|
|
|
16,366
|
|
|||||
Recorded within liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Casualty loss reserves
|
|
$
|
20,222
|
|
|
$
|
5,000
|
|
|
|
$
|
768
|
|
|
|
$
|
(3,272
|
)
|
|
|
$
|
22,718
|
|
Year ended March 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for trade accounts receivable
(1)
|
|
$
|
9,415
|
|
|
$
|
3,362
|
|
|
|
$
|
(100
|
)
|
(3)
|
|
$
|
(1,492
|
)
|
(4)
|
|
$
|
11,185
|
|
Inventory valuation reserve
|
|
17,597
|
|
|
1,146
|
|
(2)
|
|
(36
|
)
|
(3)
|
|
—
|
|
|
|
18,707
|
|
|||||
Deferred tax asset valuation allowance
|
|
14,380
|
|
|
2,151
|
|
|
|
4,439
|
|
(3)
|
|
(4,535
|
)
|
|
|
16,435
|
|
|||||
Recorded within liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Casualty loss reserves
|
|
$
|
18,078
|
|
|
$
|
4,141
|
|
|
|
$
|
1,187
|
|
|
|
$
|
(3,184
|
)
|
|
|
$
|
20,222
|
|
Accrued SYSTEM 1 Rebate Program and class action settlement
|
|
16
|
|
|
—
|
|
|
|
—
|
|
|
|
(16
|
)
|
|
|
—
|
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
Plan Category
|
|
Number of securities to
be issued upon exercise
of outstanding options,
warrants and rights
|
|
Weighted-average
exercise price of
outstanding options,
warrants and rights
($)
|
|
Number of securities
remaining available for
future issuance under
equity compensation plans
(excluding securities
reflected in column (a))
|
|
|
(a)
|
|
(b)
|
|
(c)
|
Equity compensation plans approved by security holders
|
|
2,021,662
|
|
$58.56
|
|
4,985,756
|
Equity compensation plans not approved by security holders
|
|
—
|
|
—
|
|
—
|
Total
|
|
2,021,662
|
|
$58.56
|
|
4,985,756
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
Exhibit
Number
|
Exhibit Description
|
3.1
|
|
|
|
3.2
|
|
|
|
4.1
|
|
|
|
10.1
|
|
|
|
10.2
|
|
|
|
10.3
|
|
|
|
10.4
|
|
|
|
10.5
|
|
|
|
10.6
|
|
|
|
10.7
|
|
|
|
10.8
|
|
|
|
10.9
|
|
|
|
10.10
|
|
|
|
10.11
|
|
|
|
10.12
|
|
|
|
10.13
|
|
|
|
10.14
|
|
|
|
10.15
|
|
|
|
10.16
|
|
|
|
10.17
|
|
|
|
10.18
|
|
|
|
10.19
|
|
|
|
10.20
|
|
|
|
10.21
|
|
|
|
10.22
|
|
|
|
10.23
|
|
|
|
10.24
|
|
|
|
10.25
|
|
|
|
10.26
|
|
|
|
10.27
|
|
|
|
10.28
|
|
|
|
10.29
|
|
|
|
10.30
|
|
|
|
10.31
|
|
10.32
|
|
|
|
10.33
|
|
|
|
10.34
|
|
|
|
10.35
|
|
|
|
10.36
|
|
|
|
10.37
|
|
|
|
10.38
|
|
|
|
10.39
|
|
|
|
10.40
|
|
|
|
10.41
|
|
|
|
10.42
|
|
|
|
10.43
|
|
|
|
10.44
|
|
|
|
10.45
|
|
|
|
10.46
|
|
|
|
10.47
|
|
|
|
10.48
|
|
|
|
10.49
|
|
|
|
10.50
|
|
|
|
10.51
|
|
|
|
10.52
|
|
|
|
10.53
|
|
|
|
10.54
|
|
|
|
10.55
|
|
|
|
10.56
|
|
|
|
10.57
|
|
|
|
10.58
|
|
|
|
10.59
|
|
|
|
10.60
|
|
|
|
|
|
STERIS plc
(Registrant)
|
|
|
|
|
|
Date:
|
May 30, 2018
|
By:
|
/S/ KAREN L. BURTON
|
|
|
Karen L. Burton
|
|
|
|
Vice President, Controller, and Chief Accounting Officer
|
SIGNATURE
|
|
TITLE
|
|
DATE
|
|
|
|
|
|
/S/ WALTER M ROSEBROUGH, JR.
|
|
President, Chief Executive Officer and Director
|
|
May 30, 2018
|
Walter M Rosebrough, Jr.
|
|
|
|
|
/S/ MICHAEL J. TOKICH
|
|
Senior Vice President and Chief Financial Officer (Principal Financial Officer)
|
|
May 30, 2018
|
Michael J. Tokich
|
|
|
|
|
/S/ KAREN L. BURTON
|
|
Vice President, Controller and Chief Accounting Officer
|
|
May 30, 2018
|
Karen L. Burton
|
|
|
|
|
*
|
|
Chairman and Director
|
|
May 30, 2018
|
John P. Wareham
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
Richard C. Breeden
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
Cynthia L. Feldmann
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
David B. Lewis
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
Jacqueline B. Kosecoff
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
Sir Duncan K. Nichol
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
Nirav R. Shah
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
Mohsen M. Sohi
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
Richard M. Steeves
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
Loyal W. Wilson
|
|
|
|
|
*
|
|
Director
|
|
May 30, 2018
|
Michael B. Wood
|
|
|
|
|
*
|
The undersigned, by signing his name hereto, does sign and execute this Annual Report on Form 10-K pursuant to the Powers of Attorney executed by the above-named directors of the Registrant and filed with the Securities and Exchange Commission on behalf of such directors.
|
Date:
|
May 30, 2018
|
By:
|
/S/ J. ADAM ZANGERLE
|
|
|
J. Adam Zangerle,
Attorney-in-Fact for Directors
|
|
|
|
|
STERIS plc
By:
Secretary
|
Grantee
Signature by electronic acceptance and/or execution of the Acknowledgment and Acceptance form.
|
Albert Browne Limited
|
England & Wales
|
American Sterilizer Company
|
Pennsylvania
|
Bioster Mottahedoon Egypt SAE
|
Egypt
|
Bizworth Gammarad Sdn Bhd
|
Malaysia
|
Black Diamond Video, Inc.
|
California
|
CLBV Limited
|
England & Wales
|
Controlled Environment Certification Services, Inc.
|
Ohio
|
Dover UK I Limited
|
England & Wales
|
Dover UK II Limited
|
England & Wales
|
Dover UK III Limited
|
England & Wales
|
Eschmann Holdings Limited
|
England & Wales
|
Eschmann Holdings Pte Limited
|
Singapore
|
Gammaster Sweden AB
|
Sweden
|
Genii, Inc.
|
Minnesota
|
Harwell Dosimeters Limited
Dosimeters Limited
|
England & Wales
|
Hausted, Inc.
|
Delaware
|
Herotron E-Beam Service GmbH
|
Germany
|
HSTD LLC
|
Delaware
|
HTD Holding Corp.
|
Delaware
|
Isomedix Inc.
|
Delaware
|
Isomedix Operations Inc.
|
Delaware
|
Isotron Limited
|
England & Wales
|
Medisafe America, L.L.C.
|
Florida
|
Medisafe Holdings Limited
|
England & Wales
|
Medisafe UK Limited
|
England & Wales
|
PeriOptimum, Inc.
|
Delaware
|
Phoenix Surgical Holdings Limited
|
England & Wales
|
Phoenix Optics Limited
|
England & Wales
|
ReNOVA Surgical Limited
|
England & Wales
|
SATYAtek S.A.
|
Switzerland
|
Sercon Indústria E Comércio De Aparelhos Médicos E Hospitalares Ltda.
|
Brazil
|
Shiloh Limited
|
England & Wales
|
Shiloh Properties Limited
|
England & Wales
|
Solar New US Holding Co, LLC
|
Delaware
|
Solar New US Parent Co, LLC
|
Delaware
|
Solar US Acquisition Co, LLC
|
Delaware
|
STE UK HoldCo Limited
|
England & Wales
|
STE UK Sub HoldCo Limited
|
England & Wales
|
Sterile Supplies Limited
|
England & Wales
|
SterilTek Holdings, Inc.
|
Delaware
|
SterilTek, Inc.
|
Nevada
|
STERIS AB
|
Sweden
|
STERIS Applied Sterilization Technologies ULC
|
Canada
|
STERIS Asia Pacific, Inc.
|
Delaware
|
STERIS AST CZ s.r.o.
|
Czech Republic
|
STERIS AST d.o.o.
|
Slovenia
|
STERIS AST SK s.r.o.
|
Slovakia
|
STERIS Barrier Products Solutions, Inc.
|
Pennsylvania
|
STERIS Brazil Holdings, LLC
|
Delaware
|
STERIS (BVI) I Limited
|
British Virgin Islands
|
STERIS Canada ULC
|
Canada
|
STERIS Canada Sales ULC
|
Canada
|
STERIS CH Limited
|
England & Wales
|
STERIS China Holdings Limited
|
Hong Kong
|
STERIS Corporation
|
Ohio
|
STERIS Corporation de Costa Rica, S.A.
|
Costa Rica
|
STERIS Deutschland GmbH
|
Germany
|
STERIS Dover Limited
|
England & Wales
|
STERIS Enterprises LLC
|
Russia
|
STERIS Europe, Inc.
|
Delaware
|
STERIS FinCo S.à r.l.
|
Luxembourg
|
STERIS FinCo II S.à r.l.
|
Luxembourg
|
STERIS GmbH
|
Switzerland
|
STERIS Holdings B.V.
|
Netherlands
|
STERIS Iberia, S.A.
|
Spain
|
STERIS IMS Canada Inc.
|
Canada
|
STERIS IMS Limited
|
England & Wales
|
STERIS Ireland Limited
|
Ireland
|
STERIS Inc.
|
Delaware
|
STERIS (India) Private Limited
|
India
|
STERIS Instrument Management Services, Inc.
|
Delaware
|
STERIS Irish FinCo Unlimited Company
|
Republic of Ireland
|
STERIS Irish FinCo II Unlimited Company
|
Republic of Ireland
|
STERIS Isomedix Puerto Rico, LLC.
|
Puerto Rico
|
STERIS Japan Inc.
|
Japan
|
STERIS Laboratories, Inc.
|
Minnesota
|
STERIS Latin America, Inc.
|
Delaware
|
STERIS Luxembourg Finance S.à r.l.
|
Luxembourg
|
STERIS Luxembourg Holding S.à r.l.
|
Luxembourg
|
STERIS Mauritius Limited
|
Republic of Mauritius
|
STERIS Mexico, S. de R.L. de C.V.
|
Mexico
|
STERIS NV
|
Belgium
|
STERIS Personnel Services Mexico, S. de R.L. de C.V.
|
Mexico
|
STERIS Personnel Services, Inc.
|
Delaware
|
STERIS S.r.l.
|
Italy
|
STERIS SAS.
|
France
|
STERIS SEA Sdn. Bhd.
|
Malaysia
|
STERIS (Shanghai) Trading Co., Ltd.
|
China
|
STERIS Singapore Pte Ltd
|
Singapore
|
STERIS Solutions Limited
|
England & Wales
|
STERIS S.p.A.
|
Italy
|
STERIS UK Holding Limited
|
England & Wales
|
STERIS–Austar Pharmaceutical Systems Hong Kong Limited
|
Hong Kong
|
STERIS–Austar Pharmaceutical Systems (Shanghai) Limited
|
China
|
Strategic Technology Enterprises, Inc.
|
Delaware
|
Synergy Health Allershausen GmbH
|
Germany
|
Synergy Health Amsterdam B.V.
|
The Netherlands
|
Synergy Health AST, LLC
|
Delaware
|
Synergy Health AST S.r.l.
|
Costa Rica
|
Synergy Health Däniken AG
|
Switzerland
|
Synergy Health Ede B.V.
|
The Netherlands
|
Synergy Health France SAS
|
France
|
Synergy Health Holding B.V.
|
The Netherlands
|
Synergy Health Holdings Limited
|
England & Wales
|
Synergy Health Investments Limited
|
England & Wales
|
Synergy Health Ireland Limited
|
Republic of Ireland
|
Synergy Health Limited
|
England & Wales
|
Synergy Health Logistics B.V.
|
The Netherlands
|
Synergy Health Marseille SAS
|
France
|
Synergy Health Nederland B.V.
|
The Netherlands
|
Synergy Health New York, LLC
|
Delaware
|
Synergy Health Outsourcing Solutions, Inc.
|
Florida
|
Synergy Health Radeberg GmbH
|
Germany
|
Synergy Health Sterilisation UK Limited
|
England & Wales
|
Synergy Health (Suzhou) Limited
|
China
|
Synergy Health (Suzhou) Sterilization Technologies Limited
|
China
|
Synergy Health Systems Limited
|
England & Wales
|
Synergy Health (Thailand) Limited
|
Thailand
|
Synergy Health True North, LLC
|
New York
|
Synergy Health (UK) Limited
|
England & Wales
|
Synergy Health US Holdings, Inc.
|
Delaware
|
Synergy Health US Holdings Limited
|
England & Wales
|
Synergy Health Utrecht B.V.
|
The Netherlands
|
Synergy Health Westport Limited
|
Republic of Ireland
|
Synergy Sterilisation KL (M) Sdn Bhd
|
Malaysia
|
Synergy Sterilisation Kulim (M) Sdn Bhd
|
Malaysia
|
Synergy Sterilisation (M) Sdn Bhd
|
Malaysia
|
Synergy Sterilisation Rawang (M) Sdn Bhd
|
Malaysia
|
Synergy Sterilisation South Africa (Proprietary) Limited
|
South Africa
|
United States Endoscopy Group, Inc.
|
Ohio
|
Vernon and Co. Limited
|
England & Wales
|
Vernon Carus (Malta) Limited
|
Malta
|
Vernon-Carus Limited
|
England & Wales
|
(1)
|
The names of one or more subsidiaries which, considered in the aggregate as a single subsidiary, would not constitute at the end of fiscal
2018
a “significant subsidiary” within the meaning of Rule 1-02(w) of Regulation S-X have been excluded.
|
(1)
|
Registration Statement (Form S-8, No. 333-207721) of Steris plc and subsidiaries pertaining to the STERIS plc 2006 Long-Term Equity Incentive Plan, Assumed as Amended and Restated,
|
(2)
|
Registration Statement (Form S-8, No. 333-207722) of Steris plc and subsidiaries pertaining to the STERIS Corporation 401(k) Plan,
|
(3)
|
Registration Statement (Form S-8, No. 333-214491) of Steris plc and subsidiaries pertaining to the STERIS plc 2006 Long-Term Equity Incentive Plan;
|
/s/ R
ICHARD
C. B
REEDEN
|
|
/s/ C
YNTHIA
L. F
ELDMANN
|
Richard C. Breeden, Director
|
|
Cynthia L. Feldmann, Director
|
|
|
|
/s/ J
ACQUELINE
B. K
OSECOFF
|
|
/s/ D
AVID
B. L
EWIS
|
Jacqueline B. Kosecoff, Director
|
|
David B. Lewis, Director
|
|
|
|
/s/ S
IR
D
UNCAN
K. N
ICHOL
|
|
/s/ M
OHSEN
M. S
OHI
|
Sir Duncan K. Nichol, Director
|
|
Mohsen M. Sohi, Director
|
|
|
|
/s/ R
ICHARD
M. S
TEEVES
|
|
/s/ J
OHN
P. W
AREHAM
|
Richard M. Steeves, Director
|
|
John P. Wareham, Chairman of the Board
|
|
|
|
/s/ L
OYAL
W. W
ILSON
|
|
/s/ M
ICHAEL
B. W
OOD
|
Loyal W. Wilson, Director
|
|
Michael B. Wood, Director
|
|
|
|
/s/ W
ALTER
M R
OSEBROUGH
, J
R
|
|
/s/
M
ICHAEL
J
.
T
OKICH
|
Walter M Rosebrough, Jr.
|
|
Michael J. Tokich
|
President and Chief Executive Officer
|
|
Senior Vice President and Chief Financial Officer
|
(Principal Executive Officer), Director
|
|
(Principal Financial Officer)
|
|
|
|
|
|
/s/
K
AREN
L
.
B
URTON
|
|
|
Karen L. Burton
|
|
|
Vice President, Controller and Chief Accounting Officer
|
|
|
(Principal Accounting Officer)
|
|
|
|
Richard C. Breeden, Director
|
|
Cynthia L. Feldmann, Director
|
|
|
|
Jacqueline B. Kosecoff, Director
|
|
David B. Lewis, Director
|
|
|
/s/
Nirav R. Shah
|
Sir Duncan K. Nichol, Director
|
|
Nirav R. Shah, Director
|
|
|
|
Dr. Mohsen M. Sohi, Director
|
|
Dr. Richard M. Steeves, Director
|
|
|
|
John P. Wareham, Chairman of the Board
|
|
Loyal W. Wilson, Director
|
|
|
|
Dr. Michael B. Wood, Director
|
|
Walter M Rosebrough, Jr.
President and Chief Executive Officer
(Principal Executive Officer), Director
|
|
|
|
Michael J. Tokich
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
Karen L. Burton
Vice President, Controller and
Chief Accounting Officer
(Principal Accounting Officer)
|
1.
|
I have reviewed this annual report on Form 10-K of STERIS plc;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
May 30, 2018
|
|
|
/
S
/ W
ALTER
M R
OSEBROUGH
, J
R
.
|
|
Walter M Rosebrough, Jr.
President and Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of STERIS plc;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
May 30, 2018
|
|
|
/
S
/ M
ICHAEL
J. T
OKICH
|
|
Michael J. Tokich
Senior Vice President and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
|
|
|
/
S
/ W
ALTER
M R
OSEBROUGH
, J
R
.
|
Name:
|
|
Walter M Rosebrough, Jr.
|
Title:
|
|
President and Chief Executive Officer
|
|
|
|
|
|
/
S
/ M
ICHAEL
J. T
OKICH
|
Name:
|
|
Michael J. Tokich
|
Title:
|
|
Senior Vice President and Chief Financial Officer
|