Business Wire | Jan 26, 2022 04:05PM EST

CONMED Corporation Announces Fourth Quarter and Full-Year 2021 Financial Results

Jan. 26, 2022

LARGO, Fla.--(BUSINESS WIRE)--Jan. 26, 2022--CONMED Corporation (NYSE: CNMD) today announced financial results for the fourth quarter and full year ended December 31, 2021.

Fourth Quarter 2021 Highlights

* Sales of $274.0 million increased 8.4% year over year as reported and 9.1% in constant currency. * Domestic revenue increased 5.0% year over year. * International revenue increased 12.7% year over year as reported and 14.3% in constant currency. * Diluted net earnings per share (GAAP) were $0.75, compared to diluted net earnings per share of $0.81 during the fourth quarter of 2020. * Adjusted diluted net earnings per share(1) were $1.07, compared to adjusted diluted net earnings per share of $0.84 during the fourth quarter of 2020.

Full-Year 2021 Highlights

* Sales of $1.01 billion increased 17.2% year over year as reported and 16.3% in constant currency. * Domestic revenue increased 14.6% year over year. * International revenue increased 20.4% year over year as reported and 18.4% in constant currency. * Diluted net earnings per share (GAAP) were $1.94, compared to diluted net earnings per share of $0.32 in 2020. * Adjusted diluted net earnings per share(1) were $3.21 versus adjusted diluted net earnings per share of $2.18 in 2020.

"Our 2021 financial performance finished favorably against the expectations we set at the beginning of the year despite the challenging environment. I am proud that CONMED has exceeded $1 billion in annual revenue, and our team remains focused on positioning the Company for long-term success," commented Curt R. Hartman, CONMED's Chair of the Board, President, and Chief Executive Officer.

2022 Outlook

The Company expects full-year 2022 revenue in the range of $1.075 billion to $1.125 billion. Based on recent exchange rates, the Company expects foreign exchange rates to be immaterial to full-year 2022 revenue growth.

The Company expects full-year 2022 adjusted diluted net earnings per share in the range of $3.60 to $3.85.

Supplemental Financial Disclosures

(1) A reconciliation of reported diluted net earnings per share to adjusted diluted net earnings per share, a non-GAAP financial measure, appears below.

Conference Call

The Company's management will host a conference call today at 4:30 p.m. ET to discuss its fourth quarter and full-year 2021 results.

To participate in the conference call, dial 1-844-889-7792 (domestic) or +1-661-378-9936 (international) and refer to the passcode 5936618.

This conference call will also be webcast and can be accessed from the "Investors" section of CONMED's website at www.conmed.com. The webcast replay of the call will be available at the same site approximately one hour after the end of the call.

A recording of the call will also be available from 7:30 p.m. ET on Wednesday, January 26, 2022, until 7:30 p.m. ET on Wednesday, February 2, 2022. To hear this recording, dial 1-855-859-2056 (domestic) or +1-404-537-3406 (international) and enter the passcode 5936618.

Consolidated Condensed Statements of Income

(in thousands except per share amounts, unaudited)



Three Months Ended Year Ended

December 31, December 31,

2021 2020 2021 2020



Net sales $ 273,971 $ 252,828 $ 1,010,635 $ 862,459

Cost of sales 118,115 117,314 442,599 402,159

Gross profit 155,856 135,514 568,036 460,300

% of sales 56.9 % 53.6 % 56.2 % 53.4 %

Selling &administrative 107,279 99,097 414,754 373,817 expense

Research & 11,361 11,716 43,565 40,473 development expense

Income from 37,216 24,701 109,717 46,010 operations

% of sales 13.6 % 9.8 % 10.9 % 5.3 %

Interest expense 7,569 11,114 35,485 44,052

Other expense - 89 1,127 355

Income before income 29,647 13,498 73,105 1,603 taxes

Provision (benefit) 5,203 (10,642 ) 10,563 (7,914 )for income taxes

Net income $ 24,444 $ 24,140 $ 62,542 $ 9,517



Basic EPS $ 0.83 $ 0.84 $ 2.14 $ 0.33

Diluted EPS 0.75 0.81 1.94 0.32



Basic shares 29,349 28,745 29,162 28,581

Diluted shares 32,769 29,941 32,216 29,464

Sales Summary

(in millions, unaudited)

Three Months Ended December 31,

% Change

Domestic

International

2021

2020

As Reported

Impact of Foreign Currency

Constant Currency

As Reported

As Reported

Impact of Foreign Currency

Constant Currency

Orthopedic Surgery

$

117.6

$

112.7

4.3

%

0.9

%

5.2

%

0.7

%

6.5

%

1.4

%

7.9

%

General Surgery

156.4

140.1

11.6

%

0.6

%

12.2

%

6.8

%

23.4

%

1.9

%

25.3

%

$

274.0

$

252.8

8.4

%

0.7

%

9.1

%

5.0

%

12.7

%

1.6

%

14.3

%

Single-use Products

$

222.8

$

205.9

8.2

%

0.8

%

9.0

%

2.8

%

16.1

%

1.7

%

17.8

%

Capital Products

51.2

46.9

8.9

%

0.6

%

9.5

%

18.0

%

2.0

%

1.0

%

3.0

%

$

274.0

$

252.8

8.4

%

0.7

%

9.1

%

5.0

%

12.7

%

1.6

%

14.3

%

Domestic

$

148.6

$

141.6

5.0

%

0.0

%

5.0

%

International

125.4

111.2

12.7

%

1.6

%

14.3

%

$

274.0

$

252.8

8.4

%

0.7

%

9.1

%

Year Ended December 31,

% Change

Domestic

International

2021

2020

As Reported

Impact of Foreign Currency

Constant Currency

As Reported

As Reported

Impact of Foreign Currency

Constant Currency

Orthopedic Surgery

$

438.4

$

374.7

17.0

%

-1.3

%

15.7

%

13.5

%

19.1

%

-2.1

%

17.0

%

General Surgery

572.2

487.8

17.3

%

-0.6

%

16.7

%

15.1

%

22.6

%

-2.1

%

20.5

%

$

1,010.6

$

862.5

17.2

%

-0.9

%

16.3

%

14.6

%

20.4

%

-2.0

%

18.4

%

Single-use Products

$

820.1

$

703.0

16.7

%

-0.9

%

15.8

%

13.1

%

21.6

%

-2.0

%

19.6

%

Capital Products

190.5

159.5

19.5

%

-1.1

%

18.4

%

23.3

%

16.4

%

-2.1

%

14.3

%

$

1,010.6

$

862.5

17.2

%

-0.9

%

16.3

%

14.6

%

20.4

%

-2.0

%

18.4

%

Domestic

$

552.5

$

482.1

14.6

%

0.0

%

14.6

%

International

458.1

380.4

20.4

%

-2.0

%

18.4

%

$

1,010.6

$

862.5

17.2

%

-0.9

%

16.3

%

Sales Summary

(in millions, unaudited)



Three Months Ended December 31,

% Change

Domestic International

Impact Impact 2021 2020 As of Constant As As of Constant Reported Foreign Currency Reported Reported Foreign Currency Currency Currency

Orthopedic $ 117.6 $ 112.7 4.3 % 0.9 % 5.2 % 0.7 % 6.5 % 1.4 % 7.9 %Surgery

General Surgery 156.4 140.1 11.6 % 0.6 % 12.2 % 6.8 % 23.4 % 1.9 % 25.3 %

$ 274.0 $ 252.8 8.4 % 0.7 % 9.1 % 5.0 % 12.7 % 1.6 % 14.3 %

Single-use $ 222.8 $ 205.9 8.2 % 0.8 % 9.0 % 2.8 % 16.1 % 1.7 % 17.8 %Products

Capital Products 51.2 46.9 8.9 % 0.6 % 9.5 % 18.0 % 2.0 % 1.0 % 3.0 %

$ 274.0 $ 252.8 8.4 % 0.7 % 9.1 % 5.0 % 12.7 % 1.6 % 14.3 %

Domestic $ 148.6 $ 141.6 5.0 % 0.0 % 5.0 %

International 125.4 111.2 12.7 % 1.6 % 14.3 %

$ 274.0 $ 252.8 8.4 % 0.7 % 9.1 %

Year Ended December 31,

% Change

Domestic International

Impact Impact 2021 2020 As of Constant As As of Constant Reported Foreign Currency Reported Reported Foreign Currency Currency Currency

Orthopedic $ 438.4 $ 374.7 17.0 % -1.3 % 15.7 % 13.5 % 19.1 % -2.1 % 17.0 %Surgery

General Surgery 572.2 487.8 17.3 % -0.6 % 16.7 % 15.1 % 22.6 % -2.1 % 20.5 %

$ 1,010.6 $ 862.5 17.2 % -0.9 % 16.3 % 14.6 % 20.4 % -2.0 % 18.4 %

Single-use $ 820.1 $ 703.0 16.7 % -0.9 % 15.8 % 13.1 % 21.6 % -2.0 % 19.6 %Products

Capital Products 190.5 159.5 19.5 % -1.1 % 18.4 % 23.3 % 16.4 % -2.1 % 14.3 %

$ 1,010.6 $ 862.5 17.2 % -0.9 % 16.3 % 14.6 % 20.4 % -2.0 % 18.4 %

Domestic $ 552.5 $ 482.1 14.6 % 0.0 % 14.6 %

International 458.1 380.4 20.4 % -2.0 % 18.4 %

$ 1,010.6 $ 862.5 17.2 % -0.9 % 16.3 %

Reconciliation of Reported Net Income to Adjusted Net Income

(in thousands, except per share amounts, unaudited)

Three Months Ended December 31, 2021

Gross Profit

Selling & Administrative Expense

Operating Income

Interest Expense

Tax Expense

Effective Tax Rate

Net Income

Diluted EPS

As reported

$

155,856

$

107,279

$

37,216

$

7,569

$

5,203

17.6

%

$

24,444

$

0.75

% of sales

56.9

%

39.2

%

13.6

%

Amortization(1)

$

1,500

(6,811

)

8,311

(3,386

)

2,744

8,953

Adjusted net income

$

100,468

$

45,527

$

4,183

$

7,947

19.2

%

$

33,397

$

1.07

% of sales

36.7

%

16.6

%

Diluted shares outstanding

30,594

Additional potential dilutive shares from in-the-money convertible notes(4)

2,175

Diluted shares, as reported

32,769

Convertible note hedges(5)

(1,446

)

Diluted shares, as adjusted

31,323

Three Months Ended December 31, 2020

Gross Profit

Selling & Administrative Expense

Operating Income

Interest Expense

Tax Expense/ (Benefit)

Effective Tax Rate

Net Income

Diluted EPS

As reported

$

135,514

$

99,097

$

24,701

$

11,114

$

(10,642

)

-78.8

%

$

24,140

$

0.81

% of sales

53.6

%

39.2

%

9.8

%

Restructuring and related costs (2)

-

(1,649

)

1,649

-

1,548

101

Acquisition and integration costs (3)

567

-

567

-

532

35

$

136,081

$

97,448

$

26,917

$

11,114

$

(8,562

)

$

24,276

Adjusted gross profit %

53.8

%

Amortization(1)

$

1,500

(6,998

)

8,498

(3,479

)

11,242

735

Adjusted net income

$

90,450

$

35,415

$

7,635

$

2,680

9.7

%

$

25,011

$

0.84

% of sales

35.8

%

14.0

%

Diluted shares outstanding

29,705

Additional potential dilutive shares from in-the-money convertible notes(4)

236

Diluted shares, as reported

29,941

Convertible note hedges(5)

(236

)

Diluted shares, as adjusted

29,705

Reconciliation of Reported Net Income to Adjusted Net Income

(in thousands, except per share amounts, unaudited)

Three Months Ended December 31, 2021

Gross Selling & Operating Interest Tax Effective Net Diluted Profit Administrative Income Expense Expense Tax Rate Income EPS Expense

As reported $ 155,856 $ 107,279 $ 37,216 $ 7,569 $ 5,203 17.6 % $ 24,444 $ 0.75

% of sales 56.9 % 39.2 % 13.6 %

Amortization^ $ 1,500 (6,811 ) 8,311 (3,386 ) 2,744 8,953 (1)

Adjusted net $ 100,468 $ 45,527 $ 4,183 $ 7,947 19.2 % $ 33,397 $ 1.07 income

% of sales 36.7 % 16.6 %

Dilutedshares 30,594 outstanding

Additionalpotentialdilutiveshares from 2,175 in-the-moneyconvertiblenotes^(4)

Dilutedshares, as 32,769 reported

Convertiblenote hedges^ (1,446 )(5)

Dilutedshares, as 31,323 adjusted

Three Months Ended December 31, 2020

Gross Selling & Operating Interest Tax Effective Net Diluted Profit Administrative Income Expense Expense/ Tax Rate Income EPS Expense (Benefit)

As reported $ 135,514 $ 99,097 $ 24,701 $ 11,114 $ (10,642 ) -78.8 % $ 24,140 $ 0.81

% of sales 53.6 % 39.2 % 9.8 %

Restructuringand related - (1,649 ) 1,649 - 1,548 101costs ^(2)

Acquisitionand 567 - 567 - 532 35integrationcosts ^(3)

$ 136,081 $ 97,448 $ 26,917 $ 11,114 $ (8,562 ) $ 24,276

Adjustedgross profit 53.8 %%

Amortization^ $ 1,500 (6,998 ) 8,498 (3,479 ) 11,242 735 (1)

Adjusted net $ 90,450 $ 35,415 $ 7,635 $ 2,680 9.7 % $ 25,011 $ 0.84 income

% of sales 35.8 % 14.0 %

Dilutedshares 29,705 outstanding

Additionalpotentialdilutiveshares from 236 in-the-moneyconvertiblenotes^(4)

Dilutedshares, as 29,941 reported

Convertiblenote hedges^ (236 )(5)

Dilutedshares, as 29,705 adjusted

(1) Includes amortization of intangible assets, deferred financing fees and debt discount.

(2) In 2020, the Company incurred restructuring costs related to a restructuring of our sales force.

(3) In 2020, the Company incurred inventory adjustments associated with a prior acquisition.

(4) In 2021 and 2020 , the Company's average share price exceeded the conversion price of our 2.625% convertible notes due in 2024 (the "Notes") resulting in additional potential diluted shares.

(5) Non-GAAP adjusted dilutive weighted average shares outstanding exclude dilution that is expected to be offset by the Company's convertible note hedge transactions.

(1) Includes amortization of intangible assets, deferred financing fees anddebt discount.

(2) In 2020, the Company incurred restructuring costs related to arestructuring of our sales force.

(3) In 2020, the Company incurred inventory adjustments associated with a prioracquisition.

(4) In 2021 and 2020 , the Company's average share price exceeded theconversion price of our 2.625% convertible notes due in 2024 (the "Notes")resulting in additional potential diluted shares.

(5) Non-GAAP adjusted dilutive weighted average shares outstanding excludedilution that is expected to be offset by the Company's convertible note hedgetransactions.

Reconciliation of Reported Net Income to Adjusted Net Income

(in thousands, except per share amounts, unaudited)

Year Ended December 31, 2021

Gross Profit

Selling & Administrative Expense

Operating Income

Interest Expense

Other Expense

Tax Expense

Effective Tax Rate

Net Income

Diluted EPS

As reported

$

568,036

$

414,754

$

109,717

$

35,485

$

1,127

$

10,563

14.4

%

$

62,542

$

1.94

% of sales

56.2

%

41.0

%

10.9

%

Restructuring and related costs (1)

-

(414

)

414

-

-

109

305

Debt refinancing costs (2)

-

-

-

-

(1,127

)

281

846

$

568,036

$

414,340

$

110,131

$

35,485

$

-

$

10,953

$

63,693

Adjusted gross profit %

56.2

%

Amortization(7)

$

6,000

(27,133

)

33,133

(13,943

)

-

11,394

35,682

Adjusted net income

$

387,207

$

143,264

$

21,542

$

-

$

22,347

18.4

%

$

99,375

$

3.21

% of sales

38.3

%

14.2

%

Diluted shares outstanding

30,437

Additional potential dilutive shares from in-the-money convertible notes(8)

1,779

Diluted shares, as reported

32,216

Convertible note hedges(9)

(1,273

)

Diluted shares, as adjusted

30,943

Year Ended December 31, 2020

Gross Profit

Selling & Administrative Expense

Operating Income

Interest Expense

Other Expense

Tax Expense/ (Benefit)

Effective Tax Rate

Net Income

Diluted EPS

As reported

$

460,300

$

373,817

$

46,010

$

44,052

$

355

$

(7,914

)

-493.9

%

$

9,517

$

0.32

% of sales

53.4

%

43.3

%

5.3

%

Plant underutilization costs (3)

6,586

-

6,586

-

-

739

5,847

Product rationalization costs (4)

2,169

(2,095

)

4,264

-

-

460

3,804

Restructuring and related costs (1)

1,087

(4,782

)

5,869

-

-

1,807

4,062

Acquisition and integration costs (5)

2,820

(1,192

)

4,012

-

-

888

3,124

Manufacturing consolidation costs (6)

3,993

-

3,993

-

-

485

3,508

$

476,955

$

365,748

$

70,734

$

44,052

$

355

$

(3,535

)

$

29,862

Adjusted gross profit %

55.3

%

Amortization(7)

$

6,000

(27,945

)

33,945

(13,414

)

-

13,037

34,322

Adjusted net income

$

337,803

$

104,679

$

30,638

$

355

$

9,502

12.9

%

$

64,184

$

2.18

% of sales

39.2

%

12.1

%

Reconciliation of Reported Net Income to Adjusted Net Income

(in thousands, except per share amounts, unaudited)

Year Ended December 31, 2021

Gross Selling & Operating Interest Other Tax Effective Net Diluted Profit Administrative Income Expense Expense Expense Tax Rate Income EPS Expense

As reported $ 568,036 $ 414,754 $ 109,717 $ 35,485 $ 1,127 $ 10,563 14.4 % $ 62,542 $ 1.94

% of sales 56.2 % 41.0 % 10.9 %

Restructuringand related - (414 ) 414 - - 109 305 costs ^(1)

Debt refinancing - - - - (1,127 ) 281 846costs^ (2)

$ 568,036 $ 414,340 $ 110,131 $ 35,485 $ - $ 10,953 $ 63,693

Adjusted gross 56.2 %profit %

Amortization^(7) $ 6,000 (27,133 ) 33,133 (13,943 ) - 11,394 35,682

Adjusted net $ 387,207 $ 143,264 $ 21,542 $ - $ 22,347 18.4 % $ 99,375 $ 3.21 income

% of sales 38.3 % 14.2 %

Diluted shares 30,437 outstanding

Additionalpotentialdilutive sharesfrom 1,779 in-the-moneyconvertiblenotes^(8)

Diluted shares, 32,216 as reported

Convertible note (1,273 )hedges^(9)

Diluted shares, 30,943 as adjusted

Year Ended December 31, 2020

Gross Selling & Operating Interest Other Tax Effective Net Diluted Profit Administrative Income Expense Expense Expense/ Tax Rate Income EPS Expense (Benefit)

As reported $ 460,300 $ 373,817 $ 46,010 $ 44,052 $ 355 $ (7,914 ) -493.9 % $ 9,517 $ 0.32

% of sales 53.4 % 43.3 % 5.3 %

Plantunderutilization 6,586 - 6,586 - - 739 5,847 costs ^(3)

Productrationalization 2,169 (2,095 ) 4,264 - - 460 3,804 costs ^(4)

Restructuringand related 1,087 (4,782 ) 5,869 - - 1,807 4,062 costs ^(1)

Acquisition andintegration 2,820 (1,192 ) 4,012 - - 888 3,124 costs ^(5)

Manufacturingconsolidation 3,993 - 3,993 - - 485 3,508 costs ^(6)

$ 476,955 $ 365,748 $ 70,734 $ 44,052 $ 355 $ (3,535 ) $ 29,862

Adjusted gross 55.3 %profit %

Amortization^(7) $ 6,000 (27,945 ) 33,945 (13,414 ) - 13,037 34,322

Adjusted net $ 337,803 $ 104,679 $ 30,638 $ 355 $ 9,502 12.9 % $ 64,184 $ 2.18 income

% of sales 39.2 % 12.1 %

(1) In 2021, the Company incurred restructuring costs related to restructuring of our sales force. In 2020, the Company incurred restructuring costs related to a voluntary separation arrangement with employees as a result of the COVID-19 pandemic and restructuring of our sales force.

(2) In 2021, the Company incurred costs related to a loss on early extinguishment and third party fees associated with the seventh amended and restated senior credit agreement.

(3) In 2020, the Company incurred a charge related to plant underutilization due to abnormally low production as a result of decreased sales caused by the COVID-19 pandemic.

(4) In 2020, the Company performed an analysis of product lines and determined certain catalog numbers, principally related to capital equipment, would be discontinued and consolidated into existing product offerings resulting in a charge to cost of sales. The Company also wrote-off related field inventory used for customer demonstration and evaluation of the discontinued products to selling and administrative expense.

(5) In 2020, the Company incurred inventory adjustments associated with a prior acquisition and severance and integration costs mainly related to the Buffalo Filter, LLC acquisition.

(6) In 2020, the Company incurred costs related to the consolidation of certain manufacturing operations. These costs related to winding down operations at certain locations and moving production lines to other facilities.

(7) Includes amortization of intangible assets, deferred financing fees and debt discount.

(8) In 2021, the Company's average share price exceeded the conversion price of our 2.625% convertible notes due in 2024 (the "Notes") resulting in additional potential diluted shares.

(9) Non-GAAP adjusted dilutive weighted average shares outstanding exclude dilution that is expected to be offset by the Company's convertible note hedge transactions.

(1) In 2021, the Company incurred restructuring costs related to restructuringof our sales force. In 2020, the Company incurred restructuring costs relatedto a voluntary separation arrangement with employees as a result of theCOVID-19 pandemic and restructuring of our sales force.

(2) In 2021, the Company incurred costs related to a loss on earlyextinguishment and third party fees associated with the seventh amended andrestated senior credit agreement.

(3) In 2020, the Company incurred a charge related to plant underutilizationdue to abnormally low production as a result of decreased sales caused by theCOVID-19 pandemic.

(4) In 2020, the Company performed an analysis of product lines and determinedcertain catalog numbers, principally related to capital equipment, would bediscontinued and consolidated into existing product offerings resulting in acharge to cost of sales. The Company also wrote-off related field inventoryused for customer demonstration and evaluation of the discontinued products toselling and administrative expense.

(5) In 2020, the Company incurred inventory adjustments associated with a prioracquisition and severance and integration costs mainly related to the BuffaloFilter, LLC acquisition.

(6) In 2020, the Company incurred costs related to the consolidation of certainmanufacturing operations. These costs related to winding down operations atcertain locations and moving production lines to other facilities.

(7) Includes amortization of intangible assets, deferred financing fees anddebt discount.

(8) In 2021, the Company's average share price exceeded the conversion price ofour 2.625% convertible notes due in 2024 (the "Notes") resulting in additionalpotential diluted shares.

(9) Non-GAAP adjusted dilutive weighted average shares outstanding excludedilution that is expected to be offset by the Company's convertible note hedgetransactions.

Reconciliation of Reported Net Income to EBITDA & Adjusted EBITDA

(in thousands, unaudited)

Three Months Ended

Year Ended

December 31,

December 31,

2021

2020

2021

2020

Net income

$

24,444

$

24,140

$

62,542

$

9,517

Provision (benefit) for income taxes

5,203

(10,642

)

10,563

(7,914

)

Interest expense

7,569

11,114

35,485

44,052

Depreciation

3,975

4,427

16,494

18,044

Amortization

13,502

13,608

54,249

54,581

EBITDA

$

54,693

$

42,647

$

179,333

$

118,280

Stock based compensation

4,332

2,992

16,335

13,111

Debt refinancing costs

-

-

1,127

-

Plant underutilization costs

-

-

-

6,586

Product rationalization costs

-

-

-

4,264

Restructuring and related costs

-

1,649

414

5,869

Acquisition and integration costs

-

567

-

4,012

Manufacturing consolidation costs

-

-

-

3,993

Adjusted EBITDA

$

59,025

$

47,855

$

197,209

$

156,115

EBITDA Margin

EBITDA

20.0

%

16.9

%

17.7

%

13.7

%

Adjusted EBITDA

21.5

%

18.9

%

19.5

%

18.1

%

About CONMED Corporation

CONMED is a medical technology company that provides surgical devices and equipment for minimally invasive procedures. The Company's products are used by surgeons and physicians in a variety of specialties, including orthopedics, general surgery, gynecology, thoracic surgery, and gastroenterology. For more information, visit www.conmed.com.

Forward-Looking Statements

This press release and the associated conference call may contain forward-looking statements based on certain assumptions and contingencies that involve risks and uncertainties, which could cause actual results, performance, or trends to differ materially from those expressed in the forward-looking statements herein or in previous disclosures. For example, in addition to general industry and economic conditions, factors that could cause actual results to differ materially from those in the forward-looking statements may include, but are not limited to, the risks posed to the Company's business, financial condition, and results of operations by the COVID-19 global pandemic and the various government responses to the pandemic, including deferral of surgeries, reductions in hospital and ambulatory surgery center operating volumes, disruption to potential supply chain reliability, as well as the risk factors discussed in the Company's Annual Report on Form 10-K for the full year ended December 31, 2020 and listed under the heading Forward-Looking Statements in the Company's most recently filed Form 10-Q. Any and all forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and relate to the Company's performance on a going-forward basis. The Company believes that all forward-looking statements made by it have a reasonable basis, but there can be no assurance that management's expectations, beliefs or projections as expressed in the forward-looking statements will actually occur or prove to be correct.

Supplemental Information - Reconciliation of GAAP to Non-GAAP Financial Measures

The Company supplements the reporting of its financial information determined under accounting principles generally accepted in the United States (GAAP) with certain non-GAAP financial measures, including percentage sales growth in constant currency; adjusted gross profit; cost of sales excluding specified items; adjusted selling and administrative expenses; adjusted operating income; adjusted interest expense; adjusted other expense; adjusted income tax expense (benefit); adjusted effective income tax rate; adjusted net income, adjusted diluted shares and adjusted diluted net earnings per share (EPS). The Company believes that these non-GAAP measures provide meaningful information to assist investors and shareholders in understanding its financial results and assessing its prospects for future performance. Management believes percentage sales growth in constant currency and the other adjusted measures described above are important indicators of its operations because they exclude items that may not be indicative of, or are unrelated to, its core operating results and provide a baseline for analyzing trends in the Company's underlying business. Further, the presentation of EBITDA is a non-GAAP measurement that management considers useful for measuring aspects of the Company's cash flow. Management uses these non-GAAP financial measures for reviewing the operating results and analyzing potential future business trends in connection with its budget process and bases certain management incentive compensation on these non-GAAP financial measures.

Net sales on a constant currency basis is a non-GAAP measure. The Company analyzes net sales on a constant currency basis to better measure the comparability of results between periods. To measure percentage sales growth in constant currency, the Company removes the impact of changes in foreign currency exchange rates that affect the comparability and trend of net sales. To measure earnings performance on a consistent and comparable basis, the Company excludes certain items that affect the comparability of operating results and the trend of earnings. These adjustments are irregular in timing, may not be indicative of past and future performance and are therefore excluded to allow investors to better understand underlying operating trends.

Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. These adjusted financial measures should not be considered in isolation or as a substitute for reported sales growth, gross profit, cost of sales, selling and administrative expenses, operating income, interest expense, other expense, income tax expense (benefit), effective income tax rate, net income, diluted shares and diluted net earnings per share, the most directly comparable GAAP financial measures. These non-GAAP financial measures are an additional way of viewing aspects of the Company's operations that, when viewed with GAAP results and the reconciliations to corresponding GAAP financial measures above, provide a more complete understanding of the business. The Company strongly encourages investors and shareholders to review its financial statements and publicly filed reports in their entirety and not to rely on any single financial measure.

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CONTACT: CONMED Corporation Todd W. Garner Chief Financial Officer 727-214-2975 ToddGarner@conmed.com