false--12-31Q320200001237831YesDEYes0.005P4Y00012378312020-03-110001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-07-012020-09-300001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-04-012020-06-300001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-01-012020-03-310001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2019-07-012019-09-300001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2019-04-012019-06-300001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2019-01-012019-03-310001237831us-gaap:RetainedEarningsMember2020-09-300001237831us-gaap:AdditionalPaidInCapitalMember2020-09-300001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2020-09-300001237831us-gaap:RetainedEarningsMember2020-06-300001237831us-gaap:AdditionalPaidInCapitalMember2020-06-300001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2020-06-300001237831us-gaap:RetainedEarningsMember2020-03-310001237831us-gaap:AdditionalPaidInCapitalMember2020-03-310001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2020-03-3100012378312020-03-310001237831gmed:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:RetainedEarningsMember2019-12-310001237831us-gaap:RetainedEarningsMember2019-12-310001237831us-gaap:AdditionalPaidInCapitalMember2019-12-310001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2019-12-310001237831gmed:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001237831us-gaap:RetainedEarningsMember2019-09-300001237831us-gaap:AdditionalPaidInCapitalMember2019-09-300001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2019-09-300001237831us-gaap:RetainedEarningsMember2019-06-300001237831us-gaap:AdditionalPaidInCapitalMember2019-06-300001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2019-06-3000012378312019-06-300001237831us-gaap:RetainedEarningsMember2019-03-310001237831us-gaap:AdditionalPaidInCapitalMember2019-03-310001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2019-03-3100012378312019-03-310001237831us-gaap:RetainedEarningsMember2018-12-310001237831us-gaap:AdditionalPaidInCapitalMember2018-12-310001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2018-12-310001237831us-gaap:CommonClassBMemberus-gaap:CommonStockMember2020-09-300001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-09-300001237831us-gaap:CommonClassBMemberus-gaap:CommonStockMember2020-06-300001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-06-300001237831us-gaap:CommonClassBMemberus-gaap:CommonStockMember2020-03-310001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-03-310001237831us-gaap:CommonClassBMemberus-gaap:CommonStockMember2019-12-310001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2019-12-310001237831us-gaap:CommonClassBMemberus-gaap:CommonStockMember2019-09-300001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2019-09-300001237831us-gaap:CommonClassBMemberus-gaap:CommonStockMember2019-06-300001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2019-06-300001237831us-gaap:CommonClassBMemberus-gaap:CommonStockMember2019-03-310001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2019-03-310001237831us-gaap:CommonClassBMemberus-gaap:CommonStockMember2018-12-310001237831us-gaap:CommonClassAMemberus-gaap:CommonStockMember2018-12-310001237831gmed:A2012EquityIncentivePlanMemberus-gaap:CommonClassAMember2020-09-300001237831us-gaap:NonUsMember2020-07-012020-09-300001237831gmed:SpineMember2020-07-012020-09-300001237831gmed:EmergingTechnologyMember2020-07-012020-09-300001237831country:US2020-07-012020-09-300001237831us-gaap:NonUsMember2020-01-012020-09-300001237831gmed:SpineMember2020-01-012020-09-300001237831gmed:EmergingTechnologyMember2020-01-012020-09-300001237831country:US2020-01-012020-09-300001237831us-gaap:NonUsMember2019-07-012019-09-300001237831gmed:SpineMember2019-07-012019-09-300001237831gmed:EmergingTechnologyMember2019-07-012019-09-300001237831country:US2019-07-012019-09-300001237831us-gaap:NonUsMember2019-01-012019-09-300001237831gmed:SpineMember2019-01-012019-09-300001237831gmed:EmergingTechnologyMember2019-01-012019-09-300001237831country:US2019-01-012019-09-300001237831gmed:StelkastAcquisitionMember2020-07-012020-09-300001237831gmed:StelkastAcquisitionMembergmed:OperatingActivityMember2020-01-012020-09-300001237831gmed:StelkastAcquisitionMembergmed:FinancingActivityMember2020-01-012020-09-300001237831us-gaap:AccumulatedTranslationAdjustmentMember2020-01-012020-09-300001237831us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-01-012020-09-300001237831us-gaap:AccumulatedTranslationAdjustmentMember2019-01-012019-09-300001237831us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2019-01-012019-09-300001237831us-gaap:LetterOfCreditMembergmed:CitizensBankMember2020-08-060001237831gmed:CitizensBankMember2020-08-060001237831us-gaap:LetterOfCreditMembergmed:WellsFargoBankMember2020-05-310001237831gmed:CitizensBankMember2020-01-012020-09-300001237831gmed:WellsFargoBankMember2020-05-310001237831gmed:WellsFargoBankMember2018-06-300001237831gmed:WellsFargoBankMember2011-05-310001237831us-gaap:DevelopedTechnologyRightsMember2020-01-012020-03-3100012378312019-01-012019-12-310001237831us-gaap:PatentsMember2020-01-012020-09-300001237831us-gaap:DevelopedTechnologyRightsMember2020-01-012020-09-300001237831us-gaap:CustomerRelationshipsMember2020-01-012020-09-300001237831gmed:SupplierNetworkMember2020-01-012020-09-300001237831us-gaap:InProcessResearchAndDevelopmentMember2020-01-012020-03-310001237831us-gaap:PatentsMember2019-01-012019-12-310001237831us-gaap:DevelopedTechnologyRightsMember2019-01-012019-12-310001237831us-gaap:CustomerRelationshipsMember2019-01-012019-12-310001237831gmed:SupplierNetworkMember2019-01-012019-12-310001237831us-gaap:PatentsMember2020-09-300001237831us-gaap:DevelopedTechnologyRightsMember2020-09-300001237831us-gaap:CustomerRelationshipsMember2020-09-300001237831gmed:SupplierNetworkMember2020-09-300001237831us-gaap:PatentsMember2019-12-310001237831us-gaap:DevelopedTechnologyRightsMember2019-12-310001237831us-gaap:CustomerRelationshipsMember2019-12-310001237831gmed:SupplierNetworkMember2019-12-310001237831us-gaap:EmployeeStockOptionMember2020-09-300001237831gmed:CitizensBankMemberus-gaap:LondonInterbankOfferedRateLIBORMember2020-08-062020-08-060001237831us-gaap:FederalFundsEffectiveSwapRateMember2020-08-062020-08-060001237831us-gaap:RetainedEarningsMember2020-07-012020-09-300001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2020-07-012020-09-300001237831us-gaap:RetainedEarningsMember2020-04-012020-06-300001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2020-04-012020-06-300001237831us-gaap:RetainedEarningsMember2020-01-012020-03-310001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2020-01-012020-03-310001237831us-gaap:RetainedEarningsMember2019-07-012019-09-300001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2019-07-012019-09-300001237831us-gaap:RetainedEarningsMember2019-04-012019-06-300001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2019-04-012019-06-300001237831us-gaap:RetainedEarningsMember2019-01-012019-03-310001237831us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2019-01-012019-03-310001237831us-gaap:CommonClassBMember2020-09-300001237831us-gaap:CommonClassAMember2020-09-300001237831us-gaap:CommonClassBMember2019-12-310001237831us-gaap:CommonClassAMember2019-12-310001237831us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-09-300001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001237831us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001237831gmed:SynosteAcquisitionMember2020-09-300001237831us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-09-300001237831gmed:SynosteAcquisitionMembergmed:ThirdAnniversaryMember2020-09-300001237831gmed:SynosteAcquisitionMembergmed:FourthAnniversaryMember2020-09-300001237831us-gaap:FairValueMeasurementsRecurringMember2020-09-300001237831us-gaap:FairValueInputsLevel3Member2020-09-300001237831us-gaap:FairValueInputsLevel3Member2020-06-300001237831us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001237831us-gaap:FairValueMeasurementsRecurringMember2019-12-310001237831us-gaap:FairValueInputsLevel3Member2019-12-310001237831us-gaap:FairValueInputsLevel3Member2019-09-300001237831gmed:StelkastAcquisitionMember2019-09-300001237831us-gaap:FairValueInputsLevel3Member2019-06-300001237831us-gaap:FairValueInputsLevel3Member2018-12-310001237831gmed:SynosteAcquisitionMember2020-07-012020-09-300001237831gmed:StelkastAcquisitionMember2019-07-012019-09-300001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2020-09-300001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:MunicipalBondsMember2020-09-300001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CorporateDebtSecuritiesMember2020-09-300001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CommercialPaperMember2020-09-300001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AssetBackedSecuritiesMember2020-09-300001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2020-09-300001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:MunicipalBondsMember2020-09-300001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:CorporateDebtSecuritiesMember2020-09-300001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:CommercialPaperMember2020-09-300001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:AssetBackedSecuritiesMember2020-09-300001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2019-12-310001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:MunicipalBondsMember2019-12-310001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CorporateDebtSecuritiesMember2019-12-310001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CommercialPaperMember2019-12-310001237831us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AssetBackedSecuritiesMember2019-12-310001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2019-12-310001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:MunicipalBondsMember2019-12-310001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:CorporateDebtSecuritiesMember2019-12-310001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:CommercialPaperMember2019-12-310001237831us-gaap:FairValueMeasurementsRecurringMemberus-gaap:AssetBackedSecuritiesMember2019-12-310001237831us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:ShortTermInvestmentsMember2020-09-300001237831us-gaap:MunicipalBondsMemberus-gaap:OtherLongTermInvestmentsMember2020-09-300001237831us-gaap:CorporateDebtSecuritiesMemberus-gaap:ShortTermInvestmentsMember2020-09-300001237831us-gaap:CorporateDebtSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2020-09-300001237831us-gaap:CommercialPaperMemberus-gaap:ShortTermInvestmentsMember2020-09-300001237831us-gaap:AssetBackedSecuritiesMemberus-gaap:ShortTermInvestmentsMember2020-09-300001237831us-gaap:AssetBackedSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2020-09-300001237831gmed:MunicipalBondsShortTermMemberus-gaap:ShortTermInvestmentsMember2020-09-300001237831us-gaap:ShortTermInvestmentsMember2020-09-300001237831us-gaap:OtherLongTermInvestmentsMember2020-09-300001237831us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2019-12-310001237831us-gaap:MunicipalBondsMemberus-gaap:OtherLongTermInvestmentsMember2019-12-310001237831us-gaap:CorporateDebtSecuritiesMemberus-gaap:ShortTermInvestmentsMember2019-12-310001237831us-gaap:CorporateDebtSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2019-12-310001237831us-gaap:CommercialPaperMemberus-gaap:ShortTermInvestmentsMember2019-12-310001237831us-gaap:AssetBackedSecuritiesMemberus-gaap:ShortTermInvestmentsMember2019-12-310001237831us-gaap:AssetBackedSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2019-12-310001237831gmed:MunicipalBondsShortTermMemberus-gaap:ShortTermInvestmentsMember2019-12-310001237831us-gaap:ShortTermInvestmentsMember2019-12-310001237831us-gaap:OtherLongTermInvestmentsMember2019-12-310001237831us-gaap:AdditionalPaidInCapitalMember2020-07-012020-09-300001237831us-gaap:AdditionalPaidInCapitalMember2020-04-012020-06-3000012378312020-04-012020-06-300001237831us-gaap:AdditionalPaidInCapitalMember2020-01-012020-03-3100012378312020-01-012020-03-310001237831us-gaap:AdditionalPaidInCapitalMember2019-07-012019-09-300001237831us-gaap:AdditionalPaidInCapitalMember2019-04-012019-06-3000012378312019-04-012019-06-300001237831us-gaap:AdditionalPaidInCapitalMember2019-01-012019-03-3100012378312019-01-012019-03-310001237831us-gaap:AccumulatedTranslationAdjustmentMember2020-09-300001237831us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-09-300001237831us-gaap:AccumulatedTranslationAdjustmentMember2019-12-310001237831us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2019-12-310001237831us-gaap:AccumulatedTranslationAdjustmentMember2019-09-300001237831us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2019-09-3000012378312019-09-300001237831us-gaap:AccumulatedTranslationAdjustmentMember2018-12-310001237831us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2018-12-3100012378312018-12-310001237831us-gaap:CommonClassBMemberus-gaap:CommonStockMember2020-04-012020-06-300001237831us-gaap:EmployeeStockOptionMember2020-01-012020-09-300001237831gmed:A2012EquityIncentivePlanMember2020-09-300001237831srt:MaximumMembergmed:A2012EquityIncentivePlanMember2020-09-300001237831srt:MinimumMemberus-gaap:FairValueInputsLevel3Member2020-01-012020-09-300001237831srt:MaximumMemberus-gaap:FairValueInputsLevel3Member2020-01-012020-09-300001237831srt:MinimumMember2020-09-3000012378312020-06-300001237831us-gaap:FairValueInputsLevel3Memberus-gaap:MeasurementInputDiscountRateMember2020-01-012020-09-3000012378312020-07-012020-09-3000012378312019-07-012019-09-3000012378312019-01-012019-09-300001237831gmed:SynosteAcquisitionMember2020-01-012020-09-300001237831us-gaap:FairValueInputsLevel3Member2020-07-012020-09-300001237831us-gaap:FairValueInputsLevel3Member2020-01-012020-09-300001237831us-gaap:FairValueInputsLevel3Member2019-07-012019-09-300001237831us-gaap:FairValueInputsLevel3Member2019-01-012019-09-300001237831srt:MinimumMemberus-gaap:MunicipalBondsMemberus-gaap:OtherLongTermInvestmentsMember2020-01-012020-09-300001237831srt:MinimumMemberus-gaap:CorporateDebtSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2020-01-012020-09-300001237831srt:MinimumMemberus-gaap:AssetBackedSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2020-01-012020-09-300001237831srt:MaximumMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:ShortTermInvestmentsMember2020-01-012020-09-300001237831srt:MaximumMemberus-gaap:MunicipalBondsMemberus-gaap:ShortTermInvestmentsMember2020-01-012020-09-300001237831srt:MaximumMemberus-gaap:MunicipalBondsMemberus-gaap:OtherLongTermInvestmentsMember2020-01-012020-09-300001237831srt:MaximumMemberus-gaap:CorporateDebtSecuritiesMemberus-gaap:ShortTermInvestmentsMember2020-01-012020-09-300001237831srt:MaximumMemberus-gaap:CorporateDebtSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2020-01-012020-09-300001237831srt:MaximumMemberus-gaap:CommercialPaperMemberus-gaap:ShortTermInvestmentsMember2020-01-012020-09-300001237831srt:MaximumMemberus-gaap:AssetBackedSecuritiesMemberus-gaap:ShortTermInvestmentsMember2020-01-012020-09-300001237831srt:MaximumMemberus-gaap:AssetBackedSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2020-01-012020-09-300001237831srt:MinimumMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2019-01-012019-12-310001237831srt:MinimumMemberus-gaap:MunicipalBondsMemberus-gaap:OtherLongTermInvestmentsMember2019-01-012019-12-310001237831srt:MinimumMemberus-gaap:CorporateDebtSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2019-01-012019-12-310001237831srt:MinimumMemberus-gaap:AssetBackedSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2019-01-012019-12-310001237831srt:MaximumMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2019-01-012019-12-310001237831srt:MaximumMemberus-gaap:MunicipalBondsMemberus-gaap:ShortTermInvestmentsMember2019-01-012019-12-310001237831srt:MaximumMemberus-gaap:MunicipalBondsMemberus-gaap:OtherLongTermInvestmentsMember2019-01-012019-12-310001237831srt:MaximumMemberus-gaap:CorporateDebtSecuritiesMemberus-gaap:ShortTermInvestmentsMember2019-01-012019-12-310001237831srt:MaximumMemberus-gaap:CorporateDebtSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2019-01-012019-12-310001237831srt:MaximumMemberus-gaap:CommercialPaperMemberus-gaap:ShortTermInvestmentsMember2019-01-012019-12-310001237831srt:MaximumMemberus-gaap:AssetBackedSecuritiesMemberus-gaap:ShortTermInvestmentsMember2019-01-012019-12-310001237831srt:MaximumMemberus-gaap:AssetBackedSecuritiesMemberus-gaap:OtherLongTermInvestmentsMember2019-01-012019-12-3100012378312020-09-3000012378312019-12-3100012378312020-10-2600012378312020-01-012020-09-30gmed:segmentiso4217:USDxbrli:sharesgmed:ShareBasedCompensationPlangmed:itemxbrli:pureiso4217:USDxbrli:shares

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2020

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to _______________

Commission File No. 001-35621

GLOBUS MEDICAL, INC.

(Exact name of registrant as specified in its charter)

DELAWARE

04-3744954

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

 

 

2560 General Armistead Avenue, Audubon, PA 19403

 

(610) 930-1800

(Address of principal executive offices) (Zip Code)

 

(Registrant’s telephone number, including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbols

Name of exchange on which registered

Class A Common Stock, par value $.001 per share

GMED

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:

Yes   No 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files):

Yes   No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large Accelerated Filer

Accelerated Filer

Non-accelerated Filer

Smaller Reporting Company

Emerging Growth Company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):

Yes   No 

The number of shares outstanding of the issuer’s common stock (par value $0.001 per share) as of October 26, 2020 was 98,676,042 shares.

1


Table of Contents

GLOBUS MEDICAL, INC. AND SUBSIDIARIES

TABLE OF CONTENTS

 

 

Page

PART I.

FINANCIAL INFORMATION

 

Item 1.

Financial Statements

 

 

Condensed Consolidated Balance Sheets (Unaudited)

 

 

September 30, 2020 and December 31, 2019

3

 

Condensed Consolidated Statements of Income (Unaudited)

 

 

Three and nine months ended September 30, 2020 and September 30, 2019

4

 

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

 

 

Three and nine months ended September 30, 2020 and September 30, 2019

5

Condensed Consolidated Statements of Equity (Unaudited)

 

Three and nine months ended September 30, 2020 and September 30, 2019

6

 

Condensed Consolidated Statements of Cash Flows (Unaudited)

 

 

Nine months ended September 30, 2020 and September 30, 2019

7

 

Notes to Condensed Consolidated Financial Statements (Unaudited)

8

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

24

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

34

Item 4.

Controls and Procedures

34

PART II.

OTHER INFORMATION

36

Item 1.

Legal Proceedings

36

Item 1A.

Risk Factors

36

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

36

Item 3.

Defaults Upon Senior Securities

36

Item 4.

Mine Safety Disclosures

37

Item 5.

Other Information

37

Item 6.

Exhibits

37

 

SIGNATURES

39

 

2


Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

GLOBUS MEDICAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

September 30,

December 31,

(In thousands, except par value)

2020

2019

ASSETS

Current assets:

Cash, cash equivalents, and restricted cash

$

250,607

$

195,724

Short-term marketable securities

159,030

115,763

Accounts receivable, net of allowances of $7,011 and $5,599, respectively

143,268

154,326

Inventories

231,858

196,314

Prepaid expenses and other current assets

19,091

17,243

Income taxes receivable

8,097

8,098

Total current assets

811,951

687,468

Property and equipment, net of accumulated depreciation of $267,364 and $243,732, respectively

215,274

199,841

Long-term marketable securities

275,587

409,514

Intangible assets, net

81,794

78,812

Goodwill

129,662

128,775

Other assets

22,851

21,741

Deferred income taxes

4,620

5,926

Total assets

$

1,541,739

$

1,532,077

LIABILITIES AND EQUITY

Current liabilities:

Accounts payable

$

30,022

$

24,614

Accrued expenses

61,803

63,283

Income taxes payable

979

1,057

Business acquisition liabilities

997

6,727

Deferred revenue

6,179

5,402

Payable to broker

-

10,320

Total current liabilities

99,980

111,403

Business acquisition liabilities, net of current portion

3,551

2,822

Deferred income taxes

4,128

6,023

Other liabilities

16,876

9,377

Total liabilities

124,535

129,625

Commitments and contingencies (Note 12)

 

 

Equity:

Class A common stock; $0.001 par value. Authorized 500,000,000 shares; issued and outstanding 76,241,618 and 77,394,983 shares at September 30, 2020 and December 31, 2019, respectively

76

77

Class B common stock; $0.001 par value. Authorized 275,000,000 shares; issued and outstanding 22,430,097 and 22,430,097 shares at September 30, 2020 and December 31, 2019, respectively

22

22

Additional paid-in capital

422,774

357,320

Accumulated other comprehensive income (loss)

2,207

(2,898)

Retained earnings

992,125

1,047,931

Total equity

1,417,204

1,402,452

Total liabilities and equity

$

1,541,739

$

1,532,077

See accompanying notes to unaudited condensed consolidated financial statements.


3


Table of Contents

GLOBUS MEDICAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

Three Months Ended

Nine Months Ended

September 30,

September 30,

(In thousands, except per share amounts)

2020

2019

2020

2019

Net sales

$

216,098

$

196,215

$

555,597

$

573,701

Cost of goods sold

57,097

45,387

156,604

131,214

Gross profit

159,001

150,828

398,993

442,487

Operating expenses:

Research and development

14,421

14,508

69,278

44,577

Selling, general and administrative

89,152

88,455

262,710

262,618

Provision for litigation

1,625

197

1,625

Amortization of intangibles

4,152

3,620

12,043

10,412

Acquisition related costs

1,263

559

1,867

1,245

Total operating expenses

108,988

108,767

346,095

320,477

Operating income/(loss)

50,013

42,061

52,898

122,010

Other income, net

Interest income/(expense), net

3,085

4,377

10,999

12,954

Foreign currency transaction gain/(loss)

(170)

145

(806)

123

Other income/(expense)

202

169

595

410

Total other income/(expense), net

3,117

4,691

10,788

13,487

Income/(loss) before income taxes

53,130

46,752

63,686

135,497

Income tax provision

8,914

8,445

14,358

25,816

Net income/(loss)

$

44,216

$

38,307

$

49,328

$

109,681

Earnings per share:

Basic

$

0.45

$

0.39

$

0.50

$

1.11

Diluted

$

0.44

$

0.38

$

0.49

$

1.08

Weighted average shares outstanding:

Basic

98,217

99,238

98,453

98,998

Dilutive stock options

2,268

2,862

2,370

2,687

Diluted

100,485

102,100

100,823

101,685

Anti-dilutive stock options excluded from weighted average calculation

5,101

5,108

6,130

4,939

See accompanying notes to unaudited condensed consolidated financial statements.

 

4


Table of Contents

GLOBUS MEDICAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

Three Months Ended

Nine Months Ended

September 30,

September 30,

(In thousands)

2020

2019

2020

2019

Net income/(loss)

$

44,216

$

38,307

$

49,328

$

109,681

Other comprehensive income/(loss):

Unrealized gain/(loss) on marketable securities, net of tax

(770)

244

2,285

4,027

Foreign currency translation gain/(loss)

1,679

(1,342)

2,820

319

Total other comprehensive income/(loss)

909

(1,098)

5,105

4,346

Comprehensive income/(loss)

$

45,125

$

37,209

$

54,433

$

114,027

See accompanying notes to unaudited condensed consolidated financial statements.

 

5


Table of Contents

GLOBUS MEDICAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)

Class A
Common Stock

Class B
Common Stock

Additional paid-in

Accumulated other comprehensive

Retained

(In thousands)

Shares

$

Shares

$

capital

income/(loss)

earnings

Total

Balance at December 31, 2019

77,394

$

77

22,431

$

22

$

357,320

$

(2,898)

$

1,047,931

$

1,402,452

Cumulative effects of adoption of accounting standards

(468)

(468)

Stock-based compensation

6,902

6,902

Exercise of stock options

190

1

5,762

5,763

Comprehensive income/(loss)

(3,368)

25,949

22,581

Repurchase and retirement of common stock

(1,920)

(2)

(73,862)

(73,864)

Balance at March 31, 2020

75,664

$

76

22,431

$

22

$

369,984

$

(6,266)

$

999,550

$

1,363,366

Stock-based compensation

7,426

7,426

Exercise of stock options

434

(