Condensed consolidating guarantor financial information

12 Months Ended

Dec. 31, 2019

Condensed Consolidated Guarantor Financial Information [Abstract]

Condensed consolidating guarantor financial information

Condensed consolidating guarantor financial information

Our $400 million principal amount of 4.875% Senior Notes due 2026 (the “2026 Notes”) and $500 million principal amount of 4.625% Senior Notes due 2027 (the “2027 Notes," and together with the 2026 Notes, the "Senior Notes") are issued by Teleflex Incorporated (the “Parent Company”), and payment of the Parent Company's obligations under the Senior Notes is guaranteed, jointly and severally, by certain of the Parent Company’s subsidiaries (each, a “Guarantor Subsidiary” and collectively, the “Guarantor Subsidiaries”). The 2026 Notes and 2027 Notes are guaranteed by the same Guarantor Subsidiaries. The guarantees are full and unconditional, subject to certain customary release provisions. Each Guarantor Subsidiary is directly or indirectly 100% owned by the Parent Company. Our condensed consolidating statements of income and comprehensive income and condensed consolidating statements of cash flows for the years ended December 31, 2019, 2018 and 2017 and condensed consolidating balance sheets as of December 31, 2019, and 2018 provide consolidated information for:

a. Parent Company, the issuer of the guaranteed obligations;

b. Guarantor Subsidiaries, on a combined basis;

c. Non-Guarantor Subsidiaries (i.e., those subsidiaries of the Parent Company that have not guaranteed
payment of the Senior Notes), on a combined basis; and

d. Parent Company and its subsidiaries on a consolidated basis.

In connection with our entry into the Credit Agreement on April 5, 2019 (as described in Note 10), a subsidiary of Teleflex (the "Released Subsidiary") that was a guarantor of Parent Company’s obligations under the previously outstanding credit agreement and under the Senior Notes was removed as a guarantor of Parent Company’s obligations under the Credit Agreement.  Under the indentures governing the Senior Notes, the removal of the Released Subsidiary as a guarantor under the Credit Agreement automatically resulted in the release of the Released Subsidiary from its guarantees of the Senior Notes. Therefore, as of the date of the Credit Agreement, the Released Subsidiary is no longer a Guarantor Subsidiary. The Released Subsidiary has been excluded from the information relating to the Guarantor Subsidiaries and has been included in the information relating to the Non-Guarantor Subsidiaries as of the beginning of the earliest period presented. Additionally, in 2019, we undertook certain steps to reorganize ownership of various subsidiaries. The transactions were entirely among subsidiaries under the common control of Teleflex. The reorganization that constituted a business combination has been reflected as of the beginning of the earliest period presented.

The same accounting policies as described in Note 1 to the consolidated financial statements are used by the Parent Company and each of its subsidiaries in connection with the condensed consolidating financial information, except for the use of the equity method of accounting to reflect ownership interests in subsidiaries, which are eliminated upon consolidation.

Consolidating entries and eliminations in the following condensed consolidated financial statements represent adjustments to (a) eliminate intercompany transactions between or among the Parent Company, the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries, (b) eliminate the investments in subsidiaries and (c) record consolidating entries.

TELEFLEX INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

	Year Ended December 31, 2019
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Condensed Consolidated
	(Dollars in thousands)
Net revenues	$	—	$	1,764,446	$	1,291,637	$	(460,721)	$	2,595,362
Cost of goods sold, excluding intangible asset amortization	—		977,840		559,746		(433,836)		1,103,750
Gross profit	—		786,606		731,891		(26,885)		1,491,612
Selling, general and administrative expenses	47,215		577,287		310,194		(323)		934,373
Research and development expenses	1,730		78,432		33,695		—		113,857
Restructuring and impairment charges	525		7,896		13,784		—		22,205
Gain on sale of assets	—		(2,289)		(3,788)		—		(6,077)
(Loss) income from continuing operations before interest, loss on extinguishment of debt and taxes	(49,470)		125,280		378,006		(26,562)		427,254
Interest, net	83,998		(66,834)		61,365		—		78,529
Loss on extinguishment of debt	8,822		—		—		—		8,822
(Loss) income from continuing operations before taxes	(142,290)		192,114		316,641		(26,562)		339,903
(Benefit) taxes on (loss) income from continuing operations	(57,469)		61,074		(121,558)		(4,125)		(122,078)
Equity in net income of consolidated subsidiaries	546,802		384,609		—		(931,411)		—
Income from continuing operations	461,981		515,649		438,199		(953,848)		461,981
Loss from discontinued operations	(828)		—		—		—		(828)
Tax benefit on loss from discontinued operations	(313)		—		—		—		(313)
Loss from discontinued operations	(515)		—		—		—		(515)
Net income	461,466		515,649		438,199		(953,848)		461,466
Other comprehensive (loss) income	(3,307)		19,231		11,160		(30,391)		(3,307)
Comprehensive income	$	458,159	$	534,880	$	449,359	$	(984,239)	$	458,159

	Year Ended December 31, 2018
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Condensed Consolidated
	(Dollars in thousands)
Net revenues	$	—	$	1,585,486	$	1,286,967	$	(424,070)	$	2,448,383
Cost of goods sold, excluding intangible asset amortization	—		886,724		596,281		(419,064)		1,063,941
Gross profit	—		698,762		690,686		(5,006)		1,384,442
Selling, general and administrative expenses	50,866		516,695		311,798		(671)		878,688
Research and development expenses	1,482		73,773		30,953		—		106,208
Restructuring and impairment charges	—		20,639		58,591		—		79,230
Gain on sale of assets	—		(1,388)		—		—		(1,388)
(Loss) income from continuing operations before interest and taxes	(52,348)		89,043		289,344		(4,335)		321,704
Interest, net	95,173		(58,306)		65,209		—		102,076
(Loss) income from continuing operations before taxes	(147,521)		147,349		224,135		(4,335)		219,628
(Benefit) taxes on (loss) income from continuing operations	(53,401)		49,606		27,226		(235)		23,196
Equity in net income of consolidated subsidiaries	291,572		175,161		637		(467,370)		—
Income from continuing operations	197,452		272,904		197,546		(471,470)		196,432
Income from discontinued operations	4,363		—		1,280		—		5,643
Tax on income from discontinued operations	1,013		—		260		—		1,273
Income from discontinued operations	3,350		—		1,020		—		4,370
Net income	200,802		272,904		198,566		(471,470)		200,802
Other comprehensive loss	(75,994)		(80,030)		(80,512)		160,542		(75,994)
Comprehensive income	$	124,808	$	192,874	$	118,054	$	(310,928)	$	124,808

	Year Ended December 31, 2017
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Condensed Consolidated
	(Dollars in thousands)
Net revenues	$	—	$	1,368,149	$	1,177,247	$	(399,093)	$	2,146,303
Cost of goods sold, excluding intangible asset amortization	—		778,153		594,527		(398,179)		974,501
Gross profit	—		589,996		582,720		(914)		1,171,802
Selling, general and administrative expenses	47,412		399,563		252,792		196		699,963
Research and development expenses	1,009		57,614		26,147		—		84,770
Restructuring charges	—		8,971		5,819		—		14,790
(Loss) income from continuing operations before interest, loss on extinguishment of debt and taxes	(48,421)		123,848		297,962		(1,110)		372,279
Interest, net	99,371		(36,586)		18,990		—		81,775
Loss on extinguishment of debt	5,593		—		—		—		5,593
(Loss) income from continuing operations before taxes	(153,385)		160,434		278,972		(1,110)		284,911
(Benefit) taxes on (loss) income from continuing operations	(110,921)		(12,730)		253,783		(484)		129,648
Equity in net income of consolidated subsidiaries	197,727		8,422		(3,135)		(203,014)		—
Income from continuing operations	155,263		181,586		22,054		(203,640)		155,263
Loss from discontinued operations	(4,534)		—				—		(4,534)
Tax benefit on loss from discontinued operations	(1,801)		—		—		—		(1,801)
Loss from discontinued operations	(2,733)		—		—		—		(2,733)
Net income	152,530		181,586		22,054		(203,640)		152,530
Other comprehensive income	173,626		158,490		198,453		(356,943)		173,626
Comprehensive income	$	326,156	$	340,076	$	220,507	$	(560,583)	$	326,156

TELEFLEX INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEETS

	December 31, 2019
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Condensed Consolidated
	(Dollars in thousands)
ASSETS
Current assets
Cash and cash equivalents	$	68,928	$	488	$	231,667	$	—	$	301,083
Accounts receivable, net	3,243		80,528		329,245		5,657		418,673
Accounts receivable from consolidated subsidiaries	35,629		492,655		500,811		(1,029,095)		—
Inventories	—		306,917		227,451		(57,811)		476,557
Prepaid expenses and other current assets	40,171		21,896		27,658		8,218		97,943
Prepaid taxes	6,371		—		5,705		—		12,076
Total current assets	154,342		902,484		1,322,537		(1,073,031)		1,306,332
Property, plant and equipment, net	2,936		224,176		203,607		—		430,719
Operating lease assets	12,356		66,388		34,416		—		113,160
Goodwill	—		1,286,372		958,933		—		2,245,305
Intangibles assets, net	70		1,291,810		864,405		—		2,156,285
Investments in affiliates	5,987,577		2,072,038		924,448		(8,984,063)		—
Deferred tax assets	16,345		—		6,879		(17,652)		5,572
Notes receivable and other amounts due from consolidated subsidiaries	2,064,309		3,690,788		287,807		(6,042,904)		—
Other assets	31,974		10,025		10,448		—		52,447
Total assets	$	8,269,909	$	9,544,081	$	4,613,480	$	(16,117,650)	$	6,309,820
LIABILITIES AND EQUITY
Current liabilities
Current borrowings	$	—	$	—	$	50,000	$	—	$	50,000
Accounts payable	4,641		63,121		35,154		—		102,916
Accounts payable to consolidated subsidiaries	403,486		418,321		207,288		(1,029,095)		—
Accrued expenses	8,505		36,325		55,636		—		100,466
Current portion of contingent consideration	—		144,701		3,389		—		148,090
Payroll and benefit-related liabilities	18,690		50,583		46,708		—		115,981
Accrued interest	5,482		—		32		—		5,514
Income taxes payable	—		—		6,692		—		6,692
Other current liabilities	4,224		15,458		13,714		—		33,396
Total current liabilities	445,028		728,509		418,613		(1,029,095)		563,055
Long-term borrowings	1,858,943		—		—		—		1,858,943
Deferred tax liabilities	—		357,923		99,287		(17,652)		439,558
Pension and postretirement benefit liabilities	38,073		27,027		17,619		—		82,719
Noncurrent liability for uncertain tax positions	625		6,949		2,720		—		10,294
Notes payable and other amounts due to consolidated subsidiaries	2,804,568		1,978,067		1,260,269		(6,042,904)		—
Noncurrent contingent consideration	—		64,581		7,237		—		71,818
Noncurrent operating lease liabilities	9,802		65,715		25,855		—		101,372
Other liabilities	133,550		8,462		60,729		—		202,741
Total liabilities	5,290,589		3,237,233		1,892,329		(7,089,651)		3,330,500
Total shareholders' equity	2,979,320		6,306,848		2,721,151		(9,027,999)		2,979,320
Total liabilities and shareholders' equity	$	8,269,909	$	9,544,081	$	4,613,480	$	(16,117,650)	$	6,309,820

	December 31, 2018
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Condensed Consolidated
	(Dollars in thousands)
ASSETS
Current assets
Cash and cash equivalents	$	49,523	$	5,364	$	302,274	$	—	$	357,161
Accounts receivable, net	5,885		54,378		300,689		5,334		366,286
Accounts receivable from consolidated subsidiaries	32,036		1,122,107		365,892		(1,520,035)		—
Inventories	—		267,544		191,188		(30,954)		427,778
Prepaid expenses and other current assets	30,458		9,740		28,170		4,113		72,481
Prepaid taxes	7,029		—		5,434		—		12,463
Total current assets	124,931		1,459,133		1,193,647		(1,541,542)		1,236,169
Property, plant and equipment, net	3,385		253,913		175,468		—		432,766
Goodwill	—		1,284,900		961,679		—		2,246,579
Intangibles assets, net	90		1,381,285		943,677		—		2,325,052
Investments in affiliates	5,984,566		1,507,718		837,899		(8,330,183)		—
Deferred tax assets	—		—		4,822		(2,376)		2,446
Notes receivable and other amounts due from consolidated subsidiaries	2,337,737		3,347,815		13,242		(5,698,794)		—
Other assets	17,180		5,874		11,925		—		34,979
Total assets	$	8,467,889	$	9,240,638	$	4,142,359	$	(15,572,895)	$	6,277,991
LIABILITIES AND EQUITY
Current liabilities
Current borrowings	$	36,625	$	—	$	50,000	$	—	$	86,625
Accounts payable	3,448		63,497		39,764		—		106,709
Accounts payable to consolidated subsidiaries	1,058,008		291,952		170,075		(1,520,035)		—
Accrued expenses	5,659		41,901		49,991		—		97,551
Current portion of contingent consideration	—		106,514		30,363		—		136,877
Payroll and benefit-related liabilities	17,156		45,136		42,378		—		104,670
Accrued interest	5,995		—		36		—		6,031
Income taxes payable	—		—		5,943		—		5,943
Other current liabilities	843		34,916		2,291		—		38,050
Total current liabilities	1,127,734		583,916		390,841		(1,520,035)		582,456
Long-term borrowings	2,072,200		—		—		—		2,072,200
Deferred tax liabilities	87,671		279,417		243,509		(2,376)		608,221
Pension and postretirement benefit liabilities	49,290		27,454		16,170		—		92,914
Noncurrent liability for uncertain tax positions	801		7,212		2,705		—		10,718
Notes payable and other amounts due to consolidated subsidiaries	2,451,784		2,222,580		1,024,430		(5,698,794)		—
Noncurrent contingent consideration	—		131,563		35,807		—		167,370
Other liabilities	138,431		8,204		57,499		—		204,134
Total liabilities	5,927,911		3,260,346		1,770,961		(7,221,205)		3,738,013
Total shareholders' equity	2,539,978		5,980,292		2,371,398		(8,351,690)		2,539,978
Total liabilities and shareholders' equity	$	8,467,889	$	9,240,638	$	4,142,359	$	(15,572,895)	$	6,277,991

TELEFLEX INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

	Year Ended December 31, 2019
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Condensed Consolidated
	(Dollars in thousands)
Net cash (used in) provided by operating activities from continuing operations	$	(55,472)	$	511,092	$	340,175	$	(358,727)	$	437,068
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment	(614)		(66,824)		(35,257)		—		(102,695)
Payments for businesses and intangibles acquired, net of cash acquired	—		(1,025)		(2,437)		—		(3,462)
Proceeds from sale of assets	2,362		13,296		1,049		(2,362)		14,345
Net interest proceeds on swaps designated as net investment hedges	18,331		—		—		—		18,331
Investments in affiliates	—		(5,946)		—		5,946		—
Net cash provided by (used in) investing activities from continuing operations	20,079		(60,499)		(36,645)		3,584		(73,481)
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings	275,000		—		—		—		275,000
Reduction in borrowings	(528,500)		—		—		—		(528,500)
Debt extinguishment, issuance and amendment fees	(11,635)		—		—		—		(11,635)
Proceeds from share based compensation plans and the related tax impacts	21,206		—		—		—		21,206
Payments for contingent consideration	—		(15,195)		(96,884)		—		(112,079)
Proceeds from issuance of shares	—		—		(5,654)		5,654		—
Dividends	(62,828)		—		—		—		(62,828)
Intercompany transactions	358,467		(440,274)		79,445		2,362		—
Intercompany dividends paid	—		—		(347,127)		347,127		—
Net cash provided by (used in) financing activities from continuing operations	51,710		(455,469)		(370,220)		355,143		(418,836)
Cash flows from discontinued operations:
Net cash provided by (used in) operating activities	3,088		—		(631)		—		2,457
Net cash provided by (used in) discontinued operations	3,088		—		(631)		—		2,457
Effect of exchange rate changes on cash and cash equivalents	—		—		(3,286)		—		(3,286)
Net increase (decrease) in cash and cash equivalents	19,405		(4,876)		(70,607)		—		(56,078)
Cash and cash equivalents at the beginning of the year	49,523		5,364		302,274		—		357,161
Cash and cash equivalents at the end of the year	$	68,928	$	488	$	231,667	$	—	$	301,083

	Year Ended December 31, 2018
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Condensed Consolidated
	(Dollars in thousands)
Net cash (used in) provided by operating activities from continuing operations	$	(196,727)	$	413,579	$	377,086	$	(158,852)	$	435,086
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment	(1,881)		(40,399)		(38,515)		—		(80,795)
Payments for businesses and intangibles acquired, net of cash acquired	(100)		(37,010)		(83,915)		—		(121,025)
Proceeds from sale of assets	28,239		3,878		—		(28,239)		3,878
Net interest proceeds on swaps designated as net investment hedges	1,548		—		—		—		1,548
Investments in affiliates	—		(5,700)		—		5,700		—
Net cash provided by (used in) investing activities from continuing operations	27,806		(79,231)		(122,430)		(22,539)		(196,394)
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings	35,000		—		—		—		35,000
Reduction in borrowings	(128,500)		—		—		—		(128,500)
Debt extinguishment, issuance and amendment fees	(188)		—		—		—		(188)
Proceeds from share based compensation plans and related tax impacts	22,655		—		—		—		22,655
Payments for contingent consideration	—		(10,831)		(62,404)		—		(73,235)
Proceeds from issuance of shares	—		—		5,700		(5,700)		—
Dividends	(62,165)		—		—		—		(62,165)
Intercompany transactions	314,386		(322,363)		(20,262)		28,239		—
Intercompany dividends paid	—		(4,723)		(154,129)		158,852		—
Net cash provided by (used in) financing activities from continuing operations	181,188		(337,917)		(231,095)		181,391		(206,433)
Cash flows from discontinued operations:
Net cash (used in) provided by operating activities	(547)		—		2,839		—		2,292
Net cash (used in) provided by discontinued operations	(547)		—		2,839		—		2,292
Effect of exchange rate changes on cash and cash equivalents	—		—		(10,948)		—		(10,948)
Net increase (decrease) in cash and cash equivalents	11,720		(3,569)		15,452		—		23,603
Cash and cash equivalents at the beginning of the year	37,803		8,933		286,822		—		333,558
Cash and cash equivalents at the end of the year	$	49,523	$	5,364	$	302,274	$	—	$	357,161

	Year Ended December 31, 2017
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Condensed Consolidated
	(Dollars in thousands)
Net cash (used in) provided by operating activities from continuing operations	$	(50,585)	$	(502,181)	$	1,040,985	$	(61,918)	$	426,301
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment	(240)		(34,912)		(35,751)		—		(70,903)
Payments for businesses and intangibles acquired, net of cash acquired	(975,524)		—		(792,760)		—		(1,768,284)
Proceeds from sale of assets	464,982		—		6,332		(464,982)		6,332
Investments in affiliates	—		(5,900)		—		5,900		—
Net cash used in investing activities from continuing operations	(510,782)		(40,812)		(822,179)		(459,082)		(1,832,855)
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings	2,463,500		—		—		—		2,463,500
Reduction in borrowings	(1,239,576)		—		—		—		(1,239,576)
Debt extinguishment, issuance and amendment fees	(26,664)		—		—		—		(26,664)
Proceeds from share based compensation plans and the related tax impacts	5,571		—		—		—		5,571
Payments for contingent consideration	—		(335)		—		—		(335)
Proceeds from issuance of shares	—		—		5,900		(5,900)		—
Dividends	(61,237)		—		—		—		(61,237)
Intercompany transactions	(550,579)		551,230		(465,633)		464,982		—
Intercompany dividends paid	—		—		(61,918)		61,918		—
Net cash provided by (used in) financing activities from continuing operations	591,015		550,895		(521,651)		521,000		1,141,259
Cash flows from discontinued operations:
Net cash used in operating activities	(6,416)		—		—		—		(6,416)
Net cash used in discontinued operations	(6,416)		—		—		—		(6,416)
Effect of exchange rate changes on cash and cash equivalents	—		—		61,480		—		61,480
Net increase (decrease) in cash and cash equivalents	23,232		7,902		(241,365)		—		(210,231)
Cash and cash equivalents at the beginning of the year	14,571		1,031		528,187		—		543,789
Cash and cash equivalents at the end of the year	$	37,803	$	8,933	$	286,822	$	—	$	333,558