Business segment information |
10. Business segment information
The Company has four strategic business units (“SBUs”), which are comprised of BioStim, Biologics, Extremity Fixation, and Spine Fixation supported by corporate activities. The primary metric used in managing the Company is net margin, which is defined as gross profit less sales and marketing expense. The Company neither discretely allocates assets, other than goodwill, to its operating segments nor evaluates the operating segments using discrete asset information.
The tables below present net sales for continuing operations by SBU reporting segment. Net sales include product sales and marketing service fees. Marketing service fees, which are recorded on a net basis, are comprised of fees earned for the marketing of Trinity Evolution®, Trinity ELITE® and Versashield™ in our Biologics segment.
|
|
Three Months Ended June 30, |
|
(U.S. Dollars, in thousands) |
|
2016 |
|
|
2015 |
|
|
Reported
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BioStim |
|
$ |
44,758 |
|
|
$ |
40,703 |
|
|
|
10.0 |
% |
Biologics |
|
|
14,256 |
|
|
|
15,274 |
|
|
|
(6.7 |
)% |
Extremity Fixation |
|
|
26,817 |
|
|
|
25,594 |
|
|
|
4.8 |
% |
Spine Fixation |
|
|
18,244 |
|
|
|
19,383 |
|
|
|
(5.9 |
)% |
Total net sales |
|
$ |
104,075 |
|
|
$ |
100,954 |
|
|
|
3.1 |
% |
|
|
Six Months Ended June 30, |
|
(U.S. Dollars, in thousands) |
|
2016 |
|
|
2015 |
|
|
Reported
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BioStim |
|
$ |
85,802 |
|
|
$ |
78,403 |
|
|
|
9.4 |
% |
Biologics |
|
|
28,350 |
|
|
|
29,235 |
|
|
|
(3.0 |
)% |
Extremity Fixation |
|
|
51,526 |
|
|
|
47,409 |
|
|
|
8.7 |
% |
Spine Fixation |
|
|
37,076 |
|
|
|
35,669 |
|
|
|
3.9 |
% |
Total net sales |
|
$ |
202,754 |
|
|
$ |
190,716 |
|
|
|
6.3 |
% |
The table below presents net margin, which is defined as gross profit less sales and marketing expense, by SBU reporting segment for the three and six months ended June 30, 2016 and 2015:
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
(U.S. Dollars, in thousands) |
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
$ |
81,560 |
|
|
$ |
79,044 |
|
|
$ |
158,103 |
|
|
$ |
149,467 |
|
Less: Sales and marketing |
|
|
(46,037 |
) |
|
|
(42,946 |
) |
|
|
(90,853 |
) |
|
|
(87,231 |
) |
Total net margin |
|
$ |
35,523 |
|
|
$ |
36,098 |
|
|
$ |
67,250 |
|
|
$ |
62,236 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BioStim |
|
|
18,577 |
|
|
|
16,787 |
|
|
|
34,988 |
|
|
|
30,800 |
|
Biologics |
|
|
6,719 |
|
|
|
7,285 |
|
|
|
12,823 |
|
|
|
13,229 |
|
Extremity Fixation |
|
|
8,162 |
|
|
|
9,149 |
|
|
|
15,340 |
|
|
|
16,165 |
|
Spine Fixation |
|
|
2,203 |
|
|
|
3,173 |
|
|
|
4,539 |
|
|
|
2,644 |
|
Corporate |
|
|
(138 |
) |
|
|
(296 |
) |
|
|
(440 |
) |
|
|
(602 |
) |
Total net margin |
|
|
35,523 |
|
|
|
36,098 |
|
|
|
67,250 |
|
|
|
62,236 |
|
General and administrative |
|
|
17,954 |
|
|
|
22,506 |
|
|
|
34,672 |
|
|
|
44,075 |
|
Research and development |
|
|
6,792 |
|
|
|
6,451 |
|
|
|
14,428 |
|
|
|
12,296 |
|
Restatements and related costs |
|
|
545 |
|
|
|
2,213 |
|
|
|
790 |
|
|
|
8,129 |
|
Charges related to U.S. Government resolutions |
|
|
12,870 |
|
|
|
– |
|
|
|
12,870 |
|
|
|
– |
|
Operating (loss) income |
|
$ |
(2,638 |
) |
|
$ |
4,928 |
|
|
$ |
4,490 |
|
|
$ |
(2,264 |
) |
|