2. Presentation of Financial Information &
Forward Looking Statements
Historical financial and operating data in this presentation reflect the consolidated results of Integer for the periods
indicated.
This presentation includes financial information prepared in accordance with accounting principles generally accepted in
the United States, or GAAP, as well as other financial measures referred to as non-GAAP. The non-GAAP financial
measures in this presentation, which include Adjusted Net Income, Adjusted Diluted EPS, Earnings Before Interest Taxes
Depreciation and Amortization (EBITDA), Adjusted EBITDA, and organic growth rates should be considered in addition to,
but not as substitutes for, the information prepared in accordance with GAAP. For reconciliations of these non-GAAP
financial measures to the most comparable GAAP measures, please refer to the appendix to this presentation and the
earnings release associated with this quarterly period which can be found in the investor relations section of our corporate
website (investor.integer.net).
Statements made in this presentation whether written or oral may be “forward-looking statements” within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of Securities Exchange Act of 1934, as
amended, and involve a number of risks and uncertainties. These statements can be identified by terminology such as
“may,” “will,” “should,” “could,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or
“continue” or “variations” or the negative of these terms or other comparable terminology. These statements are based on
the company’s current expectations and speak only as of July 27, 2017. The Company’s actual results could differ
materially from those stated or implied by such forward-looking statements. The Company assumes no obligation to
update forward-looking information, including information in this presentation, to reflect changed assumptions, the
occurrence of unanticipated events or changes in future operating results, financial conditions or prospects.
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 2
5. Quarterly Results Reflect Continued Progress
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 5
“Another quarter of
solid sales growth
gives us confidence
that we are back on
an annual growth
trajectory”
Second Quarter Highlights
• 2Q17 organic sales up 4.5% … Trailing 4 quarters up 2%
• Adjusted Results
‒ EBITDA increased 9% organically
‒ Net Income increased 34% organically
• Strong Cash Flow and Debt Repayment
Full Year Outlook
• Increasing low end of Sales guidance
• Adjusted EPS outlook from business operations unchanged,
updating for foreign currency losses
• Approximately $150 million of Cash Flow from Operations
9. $18
$20
$4$69 $70
$6
2Q17 Adjusted Financial Results(1)
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 9
($ in millions, except per share amounts)
(1) Refer to the appendix of this presentation for a reconciliation of Adjusted EBITDA, Adjusted Net Income, Adjusted EPS, and organic growth rates to the most directly comparable GAAP measure
(2) Organic growth for Sales excludes the impact of foreign exchange
(3) Organic growth for Adjusted EBITDA and Adjusted Net Income exclude the impact of foreign currency gain (loss) reported in other (income) loss, net
Sales Adjusted EBITDA Adjusted Net Income
2Q16 2Q17 2Q16 2Q172Q16 2Q17
4.5% organic(2)
$24
Adj
EPS
$0.56 $0.62
% Growth
4.1% reported
9% organic(3)
2% reported
34% organic(3)
13% reported
$348
$363
$364 $76
Foreign currency impact on reported GAAP and Non-GAAP numbers
As reported GAAP and Non-GAAP numbers
Reported
Reported
Reported Reported
Reported
Reported
FX Adjusted
FX Adjusted
FX Adjusted
FX
FX
11. Strong Organic Growth in
Adjusted EBITDA & Adjusted EPS
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 11
(1) Organic amounts exclude the YOY impact of foreign currency gain (loss) reported in other (income) loss, net
Adjusted EBITDA
($ in millions except per share amounts)
Adjusted EPS
$0.56
$0.18 $(0.12)
$0.62
2Q16 2Q17
$17.5
Adjusted
Net
Income
$6.2 $(4.0) $19.7
Organic(2)
FX
2Q16 2Q17
$69
$70
$(5.0)$6.5
Organic(2) FX
12. $11
$(8)
$21 $22
$26
$28
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
$30
$4
$38
$34
$39 $39
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
1Q17 2Q17
$12 $30 $38
$120
$230
$913
$360
2017 2018 2019 2020 2021 2022 2023
Debt
Payments
Continued Strong & Steady Cash Flow Generation
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 12
($ in millions)
(1) Free Cash Flow defined as Cash from Operations less Capital
Expenditures
($ in millions)
Cash Flow From Operations Free Cash Flow
($ in millions)
Future Mandatory Debt Repayment Schedule
($ in millions)
$8
$31
$40
Accelerated Repayment
Required Repayment
$29
$18
$11
• Generating cash flow well in excess of
current debt obligations
• Focused on accelerating debt
repayment to reduce leverage
• Repaid $40M of debt in 2Q17 – $69M
repaid YTD
• Total payments of $113M since
acquisition
• Near-term mandatory debt repayments
very manageable
• No significant maturities until 2020
• 33% fixed rate
• Well within covenant compliance
requirements
13. 2016 2017 2016 2017 2016 2017
Revised Full-Year 2017 Outlook
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 13
Sales Adjusted EPS Cash Flow from Operations
$1,386
$2.68
$1,400 - $1,430
$2.55 - $2.95
$106
~$150
Outlook Outlook
($ in millions except per share amounts)
1% - 3% organic(1)
%
Growth 1% - 3% reported
7% - 22% organic(2)
(5)% - 10% reported
42% reported
Outlook
(1) Organic growth for Sales excludes the impact of foreign currency exchange rates
(2) Organic growth Adjusted EPS excludes the impact of foreign currency gain (loss) reported in other (income) loss, net for both years presented
15. Trailing 4-Qtr Sales YoY %
-20%
-15%
-10%
-5%
0%
5%
10%
15%
Advanced Surgical, Orthopedics & Portable Medical
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 15
Providing a wide range of technologies and solutions to the
Advanced Surgical and Orthopedic markets
0%
Quarterly YOY Growth
7%
(5)%
(3)% (3)%
%Change
Orthopedic Implants &
Instruments
Biopsy & Drug
Delivery
Portable Medical
(Power Solutions)
Laparoscopy &
General Surgery
Arthroscopy
Products(1)%
2Q16 3Q16 4Q16 1Q17 2Q171Q16
(12)%
• 2Q17 Sales slightly down YOY, primarily driven by timing of
customer demand, full year outlook unchanged
• Trailing 4-quarter Sales stabilizing now that facility transfers
are complete
• Expect limited 2H17 Sales growth with some new product
launches
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
Trailing 4-Quarter Sales
$421 $418 $415 $421 $421$427
(6)% (1)% (0)%
16. Offering a full-range of products and services for catheter-based interventional
vascular devices and a suite of supply chain solutions to support the
development and manufacturing of complex components, sub-assemblies and finished devices
-10%
-5%
0%
5%
10%
15%
Cardio & Vascular
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 16
Steerable Sheaths Catheters & Sheaths Guidewires, Stylets &
Accessories
Introducers
0%
10%
0%
2%
9%
Quarterly YOY Growth
%Change
8%
2Q16 3Q16 4Q16 1Q17 2Q171Q16
(2)%
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
Trailing 4-Quarter Sales
$478 $480 $491
$502
$512
$478
• Another solid quarter of YOY growth in 2Q17 driven by
strong demand for Integer-owned product lines and
increasing demand for contract manufactured products
• Trailing 4-quarter Sales demonstrating continued growth
driven by strength in most recent quarters
• 2H17 growth remains positive at a slower pace versus
harder comparisons from 2H16
2% 5% 7%Trailing 4-Qtr Sales YoY %
17. Providing technology solutions for the active implantable medical device industry
by partnering with customers to bring high-quality products to
established and emerging markets – from initial concept through to high-volume manufacturing
-20%
-15%
-10%
-5%
0%
5%
10%
15%
Cardiac & Neuromodulation
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 17
Pulse Generator
Components &
Assemblies
Leads & Lead Components,
Adaptors & Assemblies
Pulse Generators & External
Solutions (Programmers,
Chargers, Patient Devices)
Quarterly YOY Growth(1)
0%
(3)%
(13)%
3%
(5)%
(1) Excludes the results of Nuvectra Corporation prior to its spin-off on
March 14, 2016
%Change
(1)%
2Q16 3Q16 4Q16 1Q17 2Q171Q16
(4)%
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
Trailing 4-Quarter Sales
• 2Q17 shows continued stabilization YOY from recovery in
CRM and growth in neuromodulation
• Trailing 4-quarter Sales also stabilizing after 2016 declines
• Second half of year will be a more challenging comparable
as 4Q16 was the strongest quarter of 2016
$441 $444 $438 $435 $434
$458
(5)% (5)% (2)%Trailing 4-Qtr Sales YoY %
18. -50%
-30%
-10%
10%
30%
50%
70%
Electrochem
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 18
Enhancing lives worldwide by providing superior power solutions that
enable the success and advancement of our customers’ critical applications
Battery Packs0%
(3)%
Battery ChargersBattery Cells
(41)%
(26)%
(14)%
Quarterly YOY Growth
%Change
60%
(34)%
2Q16 3Q16 4Q16 1Q17 2Q171Q16
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
Trailing 4-Quarter Sales
$47
$44 $42 $41
$47
$53
• 2Q17 Sales growth driven by strong momentum from
increased North American customer activity and market
share gains.
• North American market driven by energy market recovery
and improved efficiencies utilizing Electrochem technology
• Continue to aggressively pursue new and expanded market
opportunities – gaining traction with new and existing
customers
• Trailing 4-quarter Sales turned positive with strong 2Q
performance
• Positive outlook for 2H17
(30)% (23)% 1%Trailing 4-Qtr Sales YoY %
20. Our Vision and Strategy
Executing our Strategy … to Realize our Vision
• Serving the needs of our customers as their preferred
global device outsource partner
• Leveraging our global presence and breadth of
capabilities to provide high quality manufactured products
– from components to finished devices
• Delivering innovative design, process solutions and
services
And to Deliver
• Sales Growth … above market
• EBITDA and Cash Flow Growth … accelerate
• Earn a Valuation Premium
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 20
“Our vision is to
enhance the lives of
patients worldwide
by being our
customers’ partner of
choice for innovative
technologies and
services.”
23. $114 $122 $129 $126 $125 $132
$107 $107 $108 $116 $104 $106
$98
$109 $100 $107
$105
$109
$12
$10 $9
$11
$11
$16
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
Historical Financial Results
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 23
Sales(1) Adjusted EPS(1)(2)(4)
$345
$331
$348 $347
$360
Non-Medical
Cardiac & Neuro
Cardio & Vascular
Adv. Surgical, Ortho &
Portable Medical
(1) Sales and Adjusted EPS information provided on a comparable basis. Comparable basis amounts for 2016 exclude the results of Nuvectra Corporation (“Nuvectra”)
prior to its spin-off on March 14, 2016. Refer to the investor relations section of our website for historical pro forma information that contains a reconciliation of 1Q16
comparable amounts to as reported amounts.
(2) Refer to the appendix of this presentation for a reconciliation of Adjusted EPS to the most directly comparable GAAP measure
(3) Excludes impact of foreign currency gain (loss) reported in other (income) loss, net
(4) The quarterly and annual EPS numbers are calculated independently and may not sum to the total
$( in millions, except per share amounts)
$363
Impact of foreign currency gain (loss) reported in other (income) loss, net
Adjusted EPS, as reported
Organic
Adjusted
EPS(3)
$0.42
$0.56
$0.83 $0.87
$0.41
0.62
$(0.06)
$0.02
$(0.08)
$0.03
$0.14
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
$0.44$0.36 $0.58 $0.83 $0.79 $0.76
24. Working Capital
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 24
Working Capital
$( in millions)
(1) Inventory Turns calculated as “COGS divided by quarterly Average Inventory multiplied by 4” to reach an annualized number
$318 $317 $325 $332 $325 $328
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17
Inventory $267 $276 $262 $225 $231 $236
Inventory Turns
(1)
3.7 3.7 3.7 4.4 4.5 4.5
Capital Expenditures $19 $12 $17 $11 $12 $10
25. Other Operating Expenses - Historical
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 25
YTD
1Q16 2Q16 3Q16 4Q16 FY16 1Q17 2Q17
2014 Investments in
Capacity and Capabilities
$4.2 $5.1 $4.5 $3.3 $17.2 $1.6 $1.3
Legacy Lake Region Medical
Consolidation and Optimization
$2.4 $2.1 $2.9 $1.2 $8.6 $0.7 $1.5
Acquisition and Integration Costs $10.0 $7.8 $5.3 $5.2 $28.3 $4.8 $3.0
Asset Dispositions,
Severance, and Other
$4.5 $0.3 $0.3 $1.9 $6.9 $4.6 $1.1
Other consolidation and disposition
initiatives
$0.1 $0.2 $0.3 $0.1 $0.7 $0.1 $0.1
TOTAL OOE $21.1 $15.5 $13.4 $11.7 $61.7 $11.8 $6.9
Three Months Ended Three Months Ended
26. ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 26
Non-GAAP Reconciliation
Net Income and Diluted EPS Reconciliation – QTD
See the Footnotes to this table on Slide 31 of this presentation
Three Months Ended
June 30, 2017 July 1, 2016
Pre-Tax
Net
Income
Per
Diluted
Share Pre-Tax
Net
Income
(Loss)
Per
Diluted
Share
As reported (GAAP) $ 4,116 $ 2,990 $ 0.09 $ 687 $ (770) $ (0.03
Adjustments:
Amortization of intangibles(a)
11,046 7,815 0.24 9,514 6,732 0.22
IP related litigation (SG&A)(a)(b) 915 595 0.02 285 185 0.01
Consolidation and optimization expenses (OOE)(a)(c) 2,832 2,093 0.07 7,376 5,975 0.19
Acquisition and integration expenses (OOE)(a)(d) 2,970 2,037 0.06 7,859 5,145 0.16
Asset dispositions, severance and other (OOE)(a)(e)
1,118 727 0.02 259 197 0.01
Loss on cost and equity method investments, net(a) 4,427 2,877 0.09 124 81 —
Loss on extinguishment of debt(a)(f)
935 608 0.02 — — —
Taxes(a)
(8,617) — — (8,559) — —
Adjusted (Non-GAAP) $ 19,742 $ 0.62 $ 17,545 $ 0.56
Diluted weighted average shares for adjusted EPS(h)
31,982 31,228
27. ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 27
Non-GAAP Reconciliation
Net Income and Diluted EPS Reconciliation – YTD
See the Footnotes to this table on Slide 31 of this presentation
Six Months Ended
June 30, 2017 July 1, 2016
Pre-Tax
Net
Income
(Loss)
Per
Diluted
Share Pre-Tax
Net
Income
(Loss)
Per
Diluted
Share
As reported (GAAP) $ (79) $ (1,349) $ (0.04) $ (12,075) $ (13,430) $ (0.44)
Adjustments:
Amortization of intangibles(a) 22,024 15,561 0.49 18,978 13,423 0.43
IP related litigation (SG&A)(a)(b) 1,292 840 0.03 2,192 1,425 0.05
Consolidation and optimization expenses (OOE)(a)(c) 5,227 3,992 0.13 14,025 11,289 0.36
Acquisition and integration expenses (OOE)(a)(d) 7,790 5,170 0.16 17,824 11,656 0.37
Asset dispositions, severance and other (OOE)(a)(e) 5,674 3,684 0.12 4,785 4,423 0.14
(Gain) loss on cost and equity method investments, net(a) 4,825 3,136 0.10 (1,177) (765) (0.02)
Loss on extinguishment of debt(a)(f) 2,494 1,621 0.05 — — —
Nuvectra results prior to spin-off(a)(g) — — — 4,037 2,624 0.08
Taxes(a) (16,592) — — (17,944) — —
Adjusted (Non-GAAP) $ 32,655 $ 1.03 $ 30,645 $ 0.98
Diluted weighted average shares for adjusted EPS(h) 31,833 31,257
28. Non-GAAP Reconciliation
2Q17 Net Income and Diluted EPS Reconciliation
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 28
See the Footnotes to this table on Slide 29 of this presentation
GAAP Non-GAAP
Income Statement 2Q17 Actual Amortization
Litigation
Related
Charges(b)
Consolidation &
Optimization(c)(e)
Acquisition &
Integration(d)
Debt /
Investment
Related
Charges(f)
2Q17 Adjusted
Sales 362,719$ 362,719$
Cost of sales 263,447 (4,111) 259,336
Gross profit 99,272$ 4,111$ -$ -$ -$ -$ 103,383$
Gross margin 27.4% 28.5%
Operating expenses:
SG&A 39,724 (6,799) (915) 32,010
SG&A as a % of revenues 11.0% 8.8%
Research, development & engineering 12,889 (136) 12,753
RD&E as a % of revenues 3.6% 3.5%
Other operating expense 6,920 (3,950) (2,970) -
Operating income 39,739$ 11,046$ 915$ 3,950$ 2,970$ -$ 58,620$
Operating margin 11.0% 16.2%
Other (income) & expenses:
Interest expense 25,647 (935) 24,712
Interest income - -
Other (income) loss, net 9,976 (4,427) 5,549
Loss before income taxes 4,116$ 11,046$ 915$ 3,950$ 2,970$ 5,362$ 28,359$
Provision for income taxes 1,126 3,231 320 1,130 933 1,877 8,617
Effective tax rate 27.36% 30.39%
Net income (loss) 2,990$ 7,815$ 595$ 2,820$ 2,037$ 3,485$ 19,742$
Net margin 0.8% 5.4%
Weighted Average Shares O/S (h)
31,982 31,982 31,982 31,982 31,982 31,982 31,982
EPS 0.09$ 0.24$ 0.02$ 0.09$ 0.06$ 0.11$ 0.62$
Non-GAAP Adj.(a)
29. Non-GAAP Reconciliations
Footnotes to “Net Income and Diluted EPS Reconciliation”
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 29
(a) The difference between pre-tax and net income (loss) amounts is the estimated tax impact related to the respective adjustment. Net income amounts are computed
using a 35% U.S. tax rate, and the statutory tax rates in Mexico, Germany, France, Netherlands, Uruguay, Ireland and Switzerland, as adjusted for the existence of net
operating losses. Expenses that are not deductible for tax purposes (i.e. permanent tax differences) are added back at 100%.
(b) In 2013, we filed suit against AVX Corporation alleging they were infringing our intellectual property. Given the complexity and significant costs incurred pursuing this
litigation, we are excluding these litigation expenses from adjusted amounts. This matter proceeded to trial during the first quarter of 2016 and a federal jury awarded
the Company $37.5 million in damages. To date, no gains have been recognized in connection with this litigation.
(c) During 2017 and 2016, we incurred costs primarily related to the transfer of our Beaverton, OR portable medical and Plymouth, MN vascular manufacturing operations
to Tijuana, Mexico, the closure of our Arvada, CO, site and the consolidation of our two Galway, Ireland sites. In addition, 2017 costs also include expenses related to
the closure of our Clarence, NY facility.
(d) Reflects acquisition and integration costs related to the acquisition of Lake Region Medical, which was acquired in October 2015.
(e) Amounts for the second quarter of 2017 include approximately $0.6 million ($5.3 million year-to-date) of expense related to our CEO, CFO and CHRO transitions. Costs
for 2016 primarily include legal and professional fees incurred in connection with the spin-off of Nuvectra, which was completed in March 2016.
(f) Represents debt extinguishment charges in connection with pre-payments made on our Term B Loan Facility in 2017, which are included in Interest Expense.
(g) Represents the results of Nuvectra prior to its spin-off on March 14, 2016.
(h) The diluted weighted average shares for adjusted EPS for the six months ended June 30, 2017 include 674,000 of potentially dilutive shares not included in the
computation of diluted weighted average common shares for GAAP diluted EPS purposes because their effect would have been anti-dilutive given the Company’s net
loss in that period. The diluted weighted average shares for adjusted EPS for the three and six months ended July 1, 2016 include 461,000 and 514,000, respectively,
of potentially dilutive shares not included in the computation of diluted weighted average common shares for GAAP diluted EPS purposes because their effect would
have been anti-dilutive given the Company’s net loss in those periods.
30. Non-GAAP Reconciliations
EBITDA and Adjusted EBITDA Reconciliation
a) Represents the results of Nuvectra prior to its spin-off in March 2016
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 30
Three Months Ended Six Months Ended
June 30,
2017
July 1,
2016
June 30,
2017
July 1,
2016
Net Income (loss) (GAAP) $ 2,990 $ (770) $ (1,349) $ (13,430)
Interest expense 25,647 27,908 54,540 55,525
Provision for income taxes 1,126 1,457 1,270 1,355
Depreciation 13,813 13,121 27,441 26,070
Amortization 11,046 9,514 22,024 18,978
EBITDA 54,622 51,230 103,926 88,498
IP related litigation 915 285 1,292 2,192
Stock-based compensation (excluding OOE) 3,251 1,794 5,657 3,823
Consolidation and optimization expenses 2,832 7,376 5,227 14,025
Acquisition and integration expenses 2,970 7,859 7,790 17,824
Asset dispositions, severance and other 1,118 259 5,674 4,785
Noncash (gain) loss on cost and equity method investments 4,427 124 4,825 (515)
Nuvectra results prior to spin-off(a)
— — — 3,665
Adjusted EBITDA (Non-GAAP) $ 70,135 $ 68,927 $ 134,391 $ 134,297
31. Non-GAAP Reconciliations
Organic Sales Growth Rate Reconciliation (% Change)
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 31
(a) Cardiac & Neuromodulation sales for 2016 includes $1.2 million relating to Nuvectra prior to its spin-off on March 14, 2016. This amount is excluded from prior year
amounts when calculating organic percentage change.
(b) Second quarter and year-to-date 2017 sales were negatively impacted by approximately $1.2 million and $2.6 million, respectively, due to foreign currency exchange
rate fluctuations, primarily in our AS&O product line.
QTD Change (2Q 2017 vs. 2Q 2016)
GAAP
Reported
Growth
Impact of
Nuvectra
prior to
Spin-off
Foreign
Currency
Non-GAAP
Organic
Growth
Medical Sales
Cardio & Vascular 8.2% — 0.2% 8.4%
Cardiac & Neuromodulation (0.7)% — — (0.7)%
Advanced Surgical, Orthopedics & Portable Medical(b) (0.8)% — 0.9% 0.1%
Total Medical Sales 2.5% — 0.3% 2.8%
Non-Medical Sales 60.3% — — 60.3%
Total Sales 4.1% — 0.4% 4.5%
YTD Change (6M 2017 vs. 6M 2016)
Medical Sales
Cardio & Vascular 9.1% — 0.2% 9.3%
Cardiac & Neuromodulation(a) (2.5)% 0.5% — (2.0)%
Advanced Surgical, Orthopedics & Portable Medical(b) 2.9% — 0.9% 3.8%
Total Medical Sales 3.3% — 0.6% 3.9%
Non-Medical Sales 26.0% — — 26.0%
Total Sales 4.0% — 0.6% 4.6%
32. ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 32
Non-GAAP Reconciliations
Non-GAAP Organic Growth Rate Reconciliation
NM % change not meaningful
(a) Represents the impact to our growth rate from our Non-GAAP adjustments. See Tables A and B for further detail on these items.
(b) Represents the impact to our growth rate of the $5.0 million foreign currency exchange loss increase ($4.0 million net of tax, $0.12 per diluted share) for the second
quarter of 2017 compared to the second quarter of 2016 and $8.8 million foreign currency exchange loss increase ($7.1 million net of tax, $0.22 per diluted share) for
the first six months of 2017 compared to the first six months of 2016. These amounts are reported in other (income) loss, net in the condensed consolidated
statement of operations.
GAAP
Reported
Growth
Impact of
Non-GAAP
Adjustment(a)
Impact of
Foreign
Currency
Loss(b)
Non-GAAP
Organic
Growth
QTD Change (2Q 2017 vs. 2Q 2016)
EBITDA 6.6% (4.8)% 7.1% 8.9%
Net Income NM 12.5% 21.8% 34.3%
Diluted EPS NM 10.7% 20.3% 31.0%
YTD Change (6M 2017 vs. 6M 2016)
EBITDA 17.4% (17.3)% 6.6% 6.7%
Net Income NM 6.6% 24.5% 31.1%
Diluted EPS NM 5.1% 23.9% 29.0%
33. Non-GAAP Reconciliations
2017 Full-Year Outlook
ITGR: 2Q17 Earnings Conference Call / July 27, 2017 / Page 33
$( in millions, except per share amounts)
Except as described below, further
reconciliations by line item to the closest
corresponding GAAP financial measures for
Adjusted Basis Earnings per Diluted Share,
included in our “2017 Outlook” above, are
not available without unreasonable efforts on
a forward-looking basis due to the high
variability, complexity and visibility of the
charges excluded from this non-GAAP
financial measure.
Adjusted EPS for 2017 is expected to consist
of GAAP Net Income and EPS, excluding
items such as intangible amortization ($44
million), IP related litigation costs, and
consolidation, acquisition, integration, asset
disposition/write-down charges, and debt
extinguishment costs totaling approximately
$90 million. The after-tax impact of these
items is estimated to be approximately $62
million, or approximately $1.95 per diluted
share.
Adjusted EPS growth, excluding the impact
of foreign currency gain (loss) included in
other (income) loss, net, would be 7% - 22%
(in millions, except effective tax rate):
2017 Outlook 2016 Actual
Capital expenditures $50 - $60 $59
Depreciation and amortization $95 - $100 $91
Stock-based compensation ~$15 $8
Working capital decrease $10 - $20 $29
Other operating expense $25 - $35 $62
Adjusted effective tax rate ~25% 23%
Cash Taxes ~$10 ~$7
Supplemental Financial Items
Affecting Cash Flow
2017 Outlook
As Reported Growth Adjusted Basis Growth
Revenue $1,400 - $1,430 1% - 3% $1,400 - $1,430 1% - 3%
Earnings per Diluted Share $0.60 - $1.00 favorable $2.55 - $2.95 (5)% - 10%
Cash Flow from Operations ~$150 ~42% -- --
GAAP Non-GAAP