Envista Holdings Corp
For the period ended Jun 28, 2024. Filed Aug 7, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 28, 2024 · Filed Aug 7, 2024
NVST$25.17+0.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-29; filed 2024-05-01.
0001757073-24-000039
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-28; filed 2024-08-07.
0001757073-24-000066
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 90 previous paragraphs and 113 current paragraphs.
68 unchanged; 17 reworded; 26 added; 5 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 10 previous and 11 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (26)
Current report
Usage Rate Assumptions Related To Aligner Treatment Plans
Current report
Our aligner business, included in the Specialty, Products & Technologies segment, enters into revenue contracts that involve multiple future performance obligations which include optional aligners at no additional charge. Our treatment plans are comprised of the following performance obligations: initial aligner shipment and the shipment of any optional refinement aligners. For such plans, we also consider usage rates, which is the number of times a customer is expected to order additional refinement aligners. This usage rate is the basis for estimating the amount of transaction price to allocate to future performance obligations.
Current report
We continually review and update the usage rate and other related assumptions. As part of this review throughout 2024, we updated our assumptions based on our evaluation of current inputs and historical usage data. This evaluation resulted in an increase in the aggregate amount of transaction price allocated to future performance obligations for new treatment plans entered into during the year, which impacted the timing of revenue recognition. Future changes to usage rates and related assumptions may impact the pattern of revenue recognition for future treatment plans. The process of estimating the number of times a clear aligner customer is expected to order additional aligners after the initial aligner shipment requires judgment and evaluation of inputs, including historical usage data in order to predict future usage patterns.
Current report
Non-meaningful percentage change related to year-to-year comparisons are designated as NM.
Current report
Sales and core sales growth for the three months ended June 28, 2024 decreased 4.4% and 3.2%, respectively, as compared to the corresponding period in 2023. A decrease in sales volume negatively impacted sales by 4.5% on a period-over-period basis, partially offset by an increase in sales price of 1.3%. Sales volume for the three months ended June 28, 2024 was impacted by an increase in the revenue deferral from our clear aligner treatment plans resulting from higher usage rates, while overall sales decreased primarily due to lower demand in North America and China.
Current report
Goodwill and intangible asset impairment for the three and six months ended June 28, 2024 of $1,153.8 million consisted of a $960.5 million goodwill charge and a $193.3 million intangible asset charge. Approximately $707.8 million of the goodwill impairment charge related to our Specialty Products & Technologies segment and $252.7 million related to our Equipment & Consumables segment. The reduction in value is due to adverse macroeconomic factors as a result of weakened global demand, a sustained suppressed stock price, higher cost of capital, and increased raw material, supply chain and service costs, which are contributing to reduced revenue forecasts, lower operating margins, and reduced expectations of future cash flows. The intangible asset impairment charges consist of $101.1 million related to certain indefinite-lived trade names within the Specialty Products & Technologies segment and $92.2 million consisting of certain finite-lived patents and technology and customer relationships within the Equipment & Consumables segment and are primarily due to a reduction in projected cash flows discussed above.
Current report
There were no goodwill and intangible asset impairment charges recorded for the three or six month periods ended June 30, 2023.
Current report
OTHER (EXPENSE) INCOME, NET
Current report
Other expense, net for the three and six months ended June 28, 2024 primarily consists of a $1.1 million net loss on equity investments, while other income, net for the three and six months ended June 30, 2023 primarily consists of a $6.9 million gain on an equity investment.
Current report
Our effective tax rate of 1.2% and 0.2% for the three and six months ended June 28, 2024, respectively, differed from the comparable periodsin 2023 primarily due to impairment charges for goodwill and intangible assets not deductible for tax purposes.
Current report
Sales volume increased for both the three and six months ended June 28, 2024 but was impacted by an increase in the revenue deferral from our clear aligner treatment plans resulting from higher usage rates, while overall sales decreased primarily due to lower demand in North America, partially offset by growth in China and Europe.
Current report
Operating profit margin was 1.4% for the three months ended June 28, 2024, as compared to an operating profit margin of 13.4% for the comparable period of 2023. Operating profit margin was 6.1% for the six months ended June 28, 2024, as compared to an operating profit margin of 15.3% for the comparable period of 2023. The decrease in operating profit margin for both the three and six month periods was primarily due to an increase in revenue deferral from our clear aligner treatment plans resulting from higher usage rates, impairment of certain long-lived assets, higher bad debt costs, unfavorable product mix, lower period-over-period savings associated with productivity improvements and higher costs related to our long-term growth initiatives.
Current report
Sales and core sales growth for the three months ended June 28, 2024 decreased 11.2%, and 10.1%, respectively, compared to the comparable period in 2023. A decrease in sales volume negatively impacted sales by 13.2% on a period-over-period basis, partially offset by an increase in sales price of 3.1%. Sales and core sales growth for the six months ended June 28, 2024 decreased 6.4%, and 5.5%, respectively, compared to the comparable period in 2023. A decrease in sales volume negatively impacted sales by 7.1% on a period-over-period basis, partially offset by an increase in sales price of 1.6%. The decrease in sales for both the three and six months ended June 28, 2024 is primarily due to lower demand from North America, Europe and China.
Current report
Operating profit margin was 12.2% for the three months ended June 28, 2024, as compared to an operating profit margin of 19.7% for the comparable period of 2023. The decrease in operating profit margin was primarily due to a decrease in sales volume and unfavorable product mix, partially offset by favorable sales price.
Current report
Operating profit margin was 14.3% for the six months ended June 28, 2024, as compared to an operating profit margin of 17.5% for the comparable period in 2023. The decrease in operating profit margin was primarily due to a decrease in sales volume and unfavorable product mix, partially offset by favorable sales price and a decrease in amortization of intangible assets.
Current report
Financing Activities
Current report
Contractual Obligations
Current report
There were no material changes to our contractual obligations during the three and six months ended June 28, 2024.
Current report
Acquired Intangibles
Current report
Our business acquisitions typically result in the recognition of goodwill, technology, customer relationships and other intangible assets, which affect the amount of future period amortization expense and possible impairment charges that we may incur. Refer to Note 6 to our Condensed Consolidated Financial Statements for a description of our policies relating to goodwill and acquired intangibles.
Current report
We review goodwill and identified intangible assets for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. We also test goodwill and intangible assets with indefinite lives at least annually for impairment. Determining whether an impairment loss occurred requires valuation, including making a comparison of the carrying amount to the sum of discounted cash flows expected to be generated by the asset. These analyses require us to make judgments and estimates about future sales, expenses, market conditions and discount rates related to these assets. If actual results are not consistent with our estimates and assumptions, goodwill and other intangible assets may be overstated and a charge would need to be taken to net income which would adversely affect our consolidated financial statements.
Current report
In preparing our financial statements for the quarter ended June 28, 2024, we identified indicators of a "more likely than not" impairment related to various reporting units within our Specialty Products & Technologies and Equipment & Consumables segments. For goodwill, we used the income approach in performing our goodwill impairment test to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value amount. Our reporting units are the financial components of operating segments which constitute businesses for which discrete financial information is available and regularly reviewed by segment management. The income approach uses a discounted cash flow model with inputs developed using both internal and market-based data. Our significant assumptions in the discounted cash flow models vary amongst, and are specific to, each reporting unit which include, but are not limited to, discount rates, revenue growth rates, and operating margin assumptions. The discounted cash flow model requires judgments and assumptions about projected sales growth, future operating margins, discount rates and terminal values. There are inherent uncertainties related to these assumptions and our judgment in applying them to the analysis of goodwill impairment.
Current report
Our goodwill impairment analysis for the three and six months ended June 28, 2024 indicated that the fair value of five of our eight reporting units did not exceed their carrying values and consequently resulted in a $960.5 million impairment charge. The excess of the estimated fair value over carrying value (expressed as a percentage of carrying value for the respective reporting unit) for the three reporting units not impaired, ranged from approximately 38% to approximately 88%, and zero for the five reporting units with impairments. In order to evaluate the sensitivity of the fair value calculations used in the goodwill impairment test, we applied a hypothetical 10% decrease to the fair values of each reporting unit and compared those hypothetical values to the reporting unit carrying values. Based on this hypothetical 10% decrease, the excess of the estimated fair value over carrying value (expressed as a percentage of carrying value for the respective reporting unit) for the three reporting units not impaired, ranged from approximately 24% to approximately 69%. For the five impaired reporting units, the application of a hypothetical 10% decrease in fair value would result in an additional impairment of approximately $289 million.
Current report
For indefinite-lived intangible assets, we used the relief from royalty method to estimate the fair value. Our significant assumptions vary amongst, and are specific to, each underlying indefinite-lived intangible asset which includes, but is not limited to, discount rates, revenue growth rates assumptions (including perpetual growth rates) and royalty rates. As a result of our indefinite-lived intangible asset impairment test during the three and six months ended June 28, 2024, we recorded an impairment charge of $101.1 million related to certain indefinite-lived trade names within the Specialty Products & Technologies segment. The reduction in value is primarily due to a reduction in projected cash flows as discussed above.
Current report
Our impairment analysis for indefinite-lived intangible assets for the three and six months ended June 28, 2024, indicated that the fair value of two of our three trade names did not exceed their carrying value and consequently resulted in a $101.1 million impairment charge. The excess of the estimated fair value over carrying value (expressed as a percentage of carrying value for the asset) for the remaining intangible asset was approximately 41%. In order to evaluate the sensitivity of the fair value calculations used in the indefinite-lived intangible asset impairment test, we applied a hypothetical 10% decrease to the fair value and compared that hypothetical value to the underlying asset carrying value. Based on this hypothetical 10% decrease, the excess of the estimated fair value over carrying value (expressed as a percentage of carrying value for the intangible asset) for the intangible asset was approximately 27%. For the two trade names impaired, the application of a hypothetical 10% decrease in fair value would result in an additional impairment of approximately $20 million.
Current report
Furthermore, we review the carrying amounts of other finite-lived intangible assets whenever events or circumstances indicate that the carrying amounts of an asset may not be recoverable. Impairment indicators include, among other conditions, cash flow deficits, historic or anticipated declines in revenue or operating profit, and adverse legal or regulatory developments. If it is determined that such indicators are present and the review indicates that the assets will not be fully recoverable based on undiscounted estimated cash flows, their carrying values are reduced to estimated fair market value. Estimated fair market value is determined primarily using projected cash flows discounted at a rate commensurate with the risk involved. For the purposes of identifying and measuring impairment, long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. For the three and six months ended June 28, 2024, we recorded an impairment of $92.2 million related to developed technology and customer relationships within our Equipment & Consumables segment. We did not record any impairment loss for finite-lived intangible assets for the three and six months ended June 30, 2023.
Removed paragraphs (5)
Previous report
Our effective tax rate for the three months ended March 29, 2024 was 33.1% compared to 21.4%in 2023. The change in the effective rate was primarily due to the impact of a valuation allowance against certain U.S. interest carryforwards.
Previous report
Operating profit margin was 10.8% for the three months ended March 29, 2024, as compared to an operating profit margin of 17.3% for the comparable period of 2023. For the three months ended March 29, 2024, the decrease was primarily due to unfavorable product mix and sales price, and higher costs related to our long-term growth initiatives, partially offset by an increase in sales volume.
Previous report
Sales and core sales growth for the three months ended March 29, 2024 decreased 1.1%, and 0.2%, respectively, compared to the comparable period in 2023. A decrease in sales volume negatively impacted sales by 0.1% on a period-over-period basis, combined with a decrease in sales price of 0.1%. The decrease in sales is primarily due to lower demand from Europe, partially offset by higher demand in North America.
Previous report
Operating profit margin was 16.6% for the three months ended March 29, 2024, as compared to an operating profit margin of 15.0% for the comparable period of 2023. The increase in operating profit margin for the three months ended March 29, 2024 was primarily due to favorable product mix, period-over-period savings associated with productivity improvements and decreased amortization of intangible assets, partially offset by unfavorable sales volume and price.
Previous report
Financing Activities and Indebtedness
Reworded paragraphs (17)
Previous wording
Certain statements included or incorporated by reference in this Quarterly Report are “forward-looking statements” within the meaning of the U.S. federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of revenue, expenses, profit, profit margins, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other projected financial measures; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions and the integration thereof, divestitures, spin-offs, split-offs or other distributions, strategic opportunities, securities offerings, stock repurchases, dividends and executive compensation; growth, declines and other trends in markets we sell into; future regulatory approvals and the timing thereof; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; future foreign currency exchange rates and fluctuations in those rates; the anticipated timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that Envista intends or believes will or may occur in the future. Terminology such as “believe,” “anticipate,” “should,” “could,” “intend,” “will,” “plan,” “expect,” “estimate,” “project,” “target,” “may,” “possible,” “potential,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words. Forward-looking statements are based on assumptions and assessments made by our management in light of their experience and perceptions of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties, including but not limited to, the following: the conditions in the U.S. and global economy, the impact of inflation and increasing interest rates, international economic, political, legal, compliance and business factors, the markets served by us and the financial markets, the impact of our debt obligations on our operations and liquidity, developments and uncertainties in trade policies and regulations, contractions or growth rates and cyclicality of markets we serve, risks relating to product manufacturing, commodity costs and surcharges, our ability to adjust purchases and manufacturing capacity to reflect market conditions, reliance on sole or limited sources of supply, disruptions relating to war, terrorism, climate change, widespread protests and civil unrest, man-made and natural disasters, pu…
Excerpt shortened here; the source contains the full paragraph.
Current wording
Certain statements included or incorporated by reference in this Quarterly Report are “forward-looking statements” within the meaning of the U.S. federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of revenue, expenses, profit, profit margins, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other projected financial measures; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions and the integration thereof, divestitures, spin-offs, split-offs or other distributions, strategic opportunities, securities offerings, stock repurchases, dividends and executive compensation; growth, declines and other trends in markets we sell into; future regulatory approvals and the timing thereof; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; future foreign currency exchange rates and fluctuations in those rates; the anticipated timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that Envista intends or believes will or may occur in the future. Terminology such as “believe,” “anticipate,” “should,” “could,” “intend,” “will,” “plan,” “expect,” “estimate,” “project,” “target,” “may,” “possible,” “potential,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words. Forward-looking statements are based on assumptions and assessments made by our management in light of their experience and perceptions of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties, including but not limited to, the following: the conditions in the U.S. and global economy, the impact of inflation and increasing interest rates, international economic, political, legal, compliance and business factors, the markets served by us and the financial markets, the impact of our debt obligations on our operations and liquidity, developments and uncertainties in trade policies and regulations, contractions or growth rates and cyclicality of markets we serve, risks relating to product manufacturing, commodity costs and surcharges, our ability to adjust purchases and manufacturing capacity to reflect market conditions, reliance on sole or limited sources of supply, disruptions relating to war, terrorism, climate change, widespread protests and civil unrest, man-made and natural disasters, pu…
Excerpt shortened here; the source contains the full paragraph.
Previous wording
For the three months ended March 29, 2024, sales derived from customers outside of the United States were 52.8% compared to the three months ended March 31, 2023, of 52.4%. As a global provider of dental consumables, equipment and services, our operations are affected by worldwide, regional and industry-specific economic and political factors. Given the broad range of dental products, software and services provided and geographies served, we do not use any indices other than general economic trends to predict our overall outlook. Our individual businesses monitor key competitors and customers, including to the extent possible their sales, to gauge relative performance and the outlook for the future.
Current wording
For both the three and six months ended June 28, 2024, sales derived from customers outside of the United States were 52.8% compared to the three and six months ended June 30, 2023, of 52.7% and 52.5%, respectively. As a global provider of dental consumables, equipment and services, our operations are affected by worldwide, regional and industry-specific economic and political factors. Given the broad range of dental products, software and services provided and geographies served, we do not use any indices other than general economic trends to predict our overall outlook. Our individual businesses monitor key competitors and customers, including to the extent possible their sales, to gauge relative performance and the outlook for the future.
Previous wording
On a period-over-period basis, currency exchange rates negatively impacted reported sales by 1.0% for the three months ended March 29, 2024, compared to the comparable period of 2023, primarily due to the strength of the U.S. dollar against most major currencies. Any future strengthening of the U.S. dollar against major currencies would negatively impact our sales and results of operations for the remainder of the year, and any weakening of the U.S. dollar against major currencies would positively impact our sales and results of operations for the remainder of the year.
Current wording
On a period-over-period basis, currency exchange rates negatively impacted reported sales by 1.2% for both the three and six months ended June 28, 2024, compared to the comparable periods of 2023, primarily due to the strength of the U.S. dollar against most major currencies. Any future strengthening of the U.S. dollar against major currencies would negatively impact our sales and results of operations for the remainder of the year, and any weakening of the U.S. dollar against major currencies would positively impact our sales and results of operations for the remainder of the year.
Previous wording
Russia’s invasion of Ukraine and the global response to this invasion, including sanctions imposed by the U.S. and other countries, could have an adverse impact on our business, including our ability to market and sell products in the affected regions, potentially heightening our risk of cyber security attacks, impacting our ability to enforce our intellectual property rights in Russia, creating disruptions in the global supply chain, and potentially having an adverse impact on the global economy, financial markets, energy markets, currency rates and otherwise. While we are experiencing volatility in sales from this region, Russia’s invasion of Ukraine did not have a material impact on our overall financial position or results of operations as of and for the three months ended March 29, 2024 and March 31, 2023.
Current wording
Russia’s invasion of Ukraine and the global response to this invasion, including sanctions imposed by the U.S. and other countries, could have an adverse impact on our business, including our ability to market and sell products in the affected regions, potentially heightening our risk of cyber security attacks, impacting our ability to enforce our intellectual property rights in Russia, creating disruptions in the global supply chain, and potentially having an adverse impact on the global economy, financial markets, energy markets, currency rates and otherwise. While we are experiencing volatility in sales from this region, Russia’s invasion of Ukraine did not have a material impact on our overall financial position or results of operations as of and for the three and six months ended June 28, 2024 and June 30, 2023.
Previous wording
All comparisons, variances, increases or decreases discussed below are for the three months ended March 29, 2024, compared to the three months ended March 31, 2023.
Current wording
All comparisons, variances, increases or decreases discussed below are for the three and six months ended June 28, 2024, compared to the three and six months ended June 30, 2023.
Previous wording
Sales for the three months ended March 29, 2024 decreased 0.6% while core sales growth increased by 0.4% for the comparable period in 2023. An increase in sales volume positively impacted sales by 0.6% on a period-over-period basis, partially offset by a decrease in sales price of 0.2%. Sales decreased due to lower demand in North America, partially offset by an increase in China.
Current wording
Sales and core sales growth for the six months ended June 28, 2024 decreased 2.6% and 1.4%, respectively, as compared to the corresponding period in 2023. A decrease in sales volume negatively impacted sales by 2.0% on a period-over-period basis, partially offset by an increase in sales price of 0.6%. Sales volume for the six months ended June 28, 2024 was impacted by an increase in the revenue deferral from our clear aligner treatment plans resulting from higher usage rates, while overall sales decreased due to lower demand in North America, partially offset by an increase in China.
Previous wording
The increase in cost of sales during the three months ended March 29, 2024 as compared to the comparable period in 2023, was primarily due to unfavorable product mix.
Current wording
The increase in cost of sales during the three and six months ended June 28, 2024 as compared to the comparable periods in 2023, was primarily due to the impairment of certain long-lived assets, unfavorable product mix and lower period-over-period savings associated with productivity improvements.
Previous wording
The decrease in gross profit margin percentage during the three months ended March 29, 2024, as compared to the comparable period in 2023, was primarily due to unfavorable sales price and product mix, partially offset by an increase in sales volume.
Current wording
The decrease in gross profit margin percentage during the three and six months ended June 28, 2024, as compared to the comparable periods in 2023, was primarily due to the impairment of certain long-lived assets, unfavorable product mix, and lower period-over-period savings associated with productivity improvements, partially offset by an increase in sales price.
Previous wording
The increase in SG&A expenses as a percentage of sales for the three months ended March 29, 2024 as compared to the comparable period of 2023, was primarily due to higher sales and marketing and compensation spend, partially offset by decreased amortization of intangible assets.
Current wording
The increase in SG&A expenses as a percentage of sales for the six months ended June 28, 2024 as compared to the comparable period of 2023, was primarily due to higher sales and marketing costs, increased compensation, increased bad debt and higher legal settlement costs, partially offset by a decrease in amortization of intangible assets.
Previous wording
R&D expenses as a percentage of sales for the three months ended March 29, 2024, was consistent with the comparable period in 2023.
Current wording
R&D expenses as a percentage of sales for the three and six months ended June 28, 2024, was consistent with the comparable periods in 2023.
Previous wording
Interest costs were $12.9 million and $16.7 million for the three months ended March 29, 2024 and March 31, 2023, respectively. The decrease in interest costs for the three months ended March 29, 2024 as compared to the comparable period of 2023 was primarily due to higher returns on cash and cash equivalents, partially offset by higher variable rate term borrowings and interest rates.
Current wording
Interest costs were $11.7 million and $17.4 million for the three months ended June 28, 2024 and June 30, 2023, respectively, and $24.6 million and $34.1 million for the six months ended June 28, 2024 and June 30, 2023, respectively. The decrease in interest expense was primarily due to higher returns on cash and cash equivalents, partially offset by higher variable rate term borrowings and interest rates.
Previous wording
Sales for the three months ended March 29, 2024 decreased 0.3% while core sales growth increased by 0.8% compared to the comparable period in 2023. An increase in sales volume positively impacted sales by 1.1% on a period-over-period basis, partially offset by a decrease in sales price of 0.3%. The decrease in sales is primarily due to lower demand in North America, partially offset by growth in China and Europe.
Current wording
Sales for the three months ended June 28, 2024 decreased 0.5% while core sales growth increased by 0.9% compared to the comparable period in 2023. An increase in sales volume and price positively impacted sales by 0.7% and 0.2%, respectively, on a period-over-period basis.
Previous wording
Net cash provided by operating activities was $40.3 million during the three months ended March 29, 2024, as compared to net cash provided by operating activities of $3.1 million for the comparable period of 2023. The increase in cash provided by operating activities during the three months ended March 29, 2024 is primarily due to timing of vendor payments combined with lower year end incentive compensation paid in the current period, partially offset by lower net income as compared to 2023.
Current wording
Net cash provided by operating activities was $133.4 million during the six months ended June 28, 2024, as compared to net cash provided by operating activities of $78.2 million for the comparable period of 2023. The increase in cash provided by operating activities during the six months ended June 28, 2024 is primarily due to timing of vendor payments combined with an increase in cash collections, partially offset by lower net income as compared to 2023.
Previous wording
Net cash used in investing activities was $10.7 million for the three months ended March 29, 2024, as compared to net cash used in investing activities of $22.0 million for the comparable period in 2023, primarily due to the lower payments for purchases of property, plant and equipment.
Current wording
Net cash used in investing activities was $16.6 million for the six months ended June 28, 2024, as compared to net cash used in investing activities of $24.8 million for the comparable period in 2023, and was primarily due to the lower payments for purchases of property, plant and equipment offset by the absence of proceeds for the sale of an equity investment in the prior year.
Previous wording
Net cash used by finance activities was $2.6 million for the three months ended March 29, 2024 compared to net cash used by financing activities of $1.5 million for the comparable period of 2023, primarily due to lower cash proceeds from stock option exercises.
Current wording
Net cash used by finance activities was $2.3 million for the six months ended June 28, 2024 compared to net cash provided by financing activities of $1.1 million for the comparable period of 2023, primarily due to lower cash proceeds from stock option exercises.
Previous wording
As of March 29, 2024, we held $948.5 million of cash and cash equivalents that were held on deposit with financial institutions. Of this amount, $326.2 million was held within the United States and $622.3 million was held outside of the United States. We will continue to have cash requirements to support working capital needs, capital expenditures and acquisitions, pay interest and service debt, pay taxes and any related interest or penalties, fund our restructuring activities as required and support other business needs. We generally intend to use available cash, internally generated funds and our revolving credit facility to meet these cash requirements, but in the event that additional liquidity is required, particularly in connection with acquisitions, we may need to enter into new credit facilities or access the capital markets. We may also access the capital markets from time to time to take advantage of favorable interest rate environments or other market conditions. However, there is no guarantee that we will be able to obtain alternative sources of financing on commercially reasonable terms or at all. See “Item 1A. Risk Factors—Risks Related to Our Business” in our 2023 10-K.
Current wording
As of June 28, 2024, we held $1,036.2 million of cash and cash equivalents that were held on deposit with financial institutions. Of this amount, $338.2 million was held within the United States and $698.0 million was held outside of the United States. We will continue to have cash requirements to support working capital needs, capital expenditures and acquisitions, pay interest and service debt, pay taxes and any related interest or penalties, fund our restructuring activities as required and support other business needs. We generally intend to use available cash, internally generated funds and our revolving credit facility to meet these cash requirements, but in the event that additional liquidity is required, particularly in connection with acquisitions, we may need to enter into new credit facilities or access the capital markets. We may also access the capital markets from time to time to take advantage of favorable interest rate environments or other market conditions. However, there is no guarantee that we will be able to obtain alternative sources of financing on commercially reasonable terms or at all. See “Item 1A. Risk Factors—Risks Related to Our Business” in our 2023 10-K.
Previous wording
There were no material changes to our critical accounting estimates described in the 2023 10-K that have had a material impact on our Condensed Consolidated Financial Statements.
Current wording
There were no material changes to our critical accounting estimates described in the 2023 10-K that have had a material impact on our Condensed Consolidated Financial Statements, other than the below related to acquired intangibles.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
The increase in SG&A expenses as a percentage of sales for the three months ended June 28, 2024 as compared to the comparable period of 2023, was primarily due to higher sales and marketing costs, increased compensation and higher bad debt and legal settlement costs.
Current report — wording carried from elsewhere
Sales for the six months ended June 28, 2024 decreased 0.4% while core sales growth increased by 0.9% compared to the comparable period in 2023. An increase in sales volume positively impacted sales by 0.9% on a period-over-period basis.