ICU Medical Announces Fourth Quarter 2022 Results and Provides Fiscal Year 2023 Guidance

Rhea-AI Summary

ICU Medical, Inc. (Nasdaq:ICUI) reported significant financial results for Q4 2022, with revenues reaching $578 million, up from $340.5 million year-over-year. Despite this strong revenue growth, the company experienced a GAAP net loss of $(15.5 million) or $(0.65 per diluted share), contrasting with a net income of $19.9 million or $0.91 per diluted share in Q4 2021. The GAAP gross margin declined to 30% from 37% a year prior. Adjusted diluted EPS was $1.60, down from $1.82. The company expects a net loss between $(73) million and $(37) million for FY 2023, with adjusted EBITDA forecasted between $375 million and $425 million.

Positive

• Revenue increased to $578 million in Q4 2022, up $237.5 million from 2021.
• Adjusted EBITDA rose to $96.4 million in Q4 2022, an increase from $64.2 million in Q4 2021.

Negative

• GAAP net loss of $(15.5 million) in Q4 2022, compared to net income of $19.9 million in Q4 2021.
• GAAP gross margin declined to 30% from 37% year-over-year.
• Fiscal Year 2023 guidance indicates a projected net loss of $(73) million to $(37) million.

SAN CLEMENTE, Calif., Feb. 27, 2023 (GLOBE NEWSWIRE) -- ICU Medical, Inc. (Nasdaq:ICUI), a leader in the development, manufacture and sale of innovative medical products, today announced financial results for the quarter ended December 31, 2022.

Fourth Quarter 2022 Results

Fourth quarter 2022 revenue was $578.0 million, compared to $340.5 million in the same period last year. GAAP gross profit for the fourth quarter of 2022 was $174.9 million, as compared to $127.5 million in the same period last year. GAAP gross margin for the fourth quarter of 2022 was 30%, as compared to 37% in the same period last year. GAAP net loss for the fourth quarter of 2022 was $(15.5) million, or $(0.65) per diluted share, as compared to GAAP net income of $19.9 million, or $0.91 per diluted share, for the fourth quarter of 2021. Adjusted diluted earnings per share for the fourth quarter of 2022 was $1.60 as compared to $1.82 for the fourth quarter of 2021. Also, adjusted EBITDA was $96.4 million for the fourth quarter of 2022 as compared to $64.2 million for the fourth quarter of 2021.

Adjusted EBITDA and adjusted diluted earnings per share are measures calculated and presented on the basis of methodologies other than in accordance with GAAP. Please refer to the Use of Non-GAAP Financial Information following the financial statements herein for further discussion and reconciliations of these measures to GAAP measures.

Vivek Jain, ICU Medical’s Chief Executive Officer, said, “Legacy ICU Medical revenues were in line with expectations and results from the acquired Smiths Medical business reflect continued operational improvements."

Revenues by product line for the three and twelve months ended December 31, 2022 and 2021 were as follows (in millions):

As a result of the acquisition of Smiths Medical on January 6, 2022, the following product lines are presented in addition to our legacy product lines: Infusion Systems-Smiths Medical, Vascular Access -Smiths Medical and Vital Care-Smiths Medical.

		Three months ended December 31,												Twelve months ended December 31,
Product Line		2022				2021				$ Change				2022				2021				$ Change
Infusion Consumables		$	140.5			$	147.8			$	(7.3	)		$	566.6			$	555.2			$	11.4
Infusion Systems			89.0				92.6				(3.6	)			351.1				352.3				(1.2	)
IV Solutions*			84.5				87.6				(3.1	)			363.5				359.5				4.0
Critical Care			12.0				12.5				(0.5	)			47.3				49.3				(2.0	)
Infusion Systems-Smiths Medical			99.1				—				99.1				340.1				—				340.1
Vascular Access-Smiths Medical			75.4				—				75.4				326.8				—				326.8
Vital Care-Smiths Medical			77.5				—				77.5				284.6				—				284.6
		$	578.0			$	340.5			$	237.5			$	2,280.0			$	1,316.3			$	963.7

*IV Solutions includes $13.1 million and $54.0 million of contract manufacturing to Pfizer for the three and twelve months ended December 31, 2022, respectively. IV Solutions includes $10.6 million and $42.8 million of contract manufacturing to Pfizer for the three and twelve months ended December 31, 2021, respectively.

Fiscal Year 2023 Guidance

For Fiscal Year 2023 the Company estimates GAAP net loss to be in the range of $(73) to $(37) and GAAP diluted loss per share estimated to be in the range of $(3.00) to $(1.50). For the Fiscal Year 2023, the Company expects adjusted EBITDA to be in the range of $375 million to $425 million, and adjusted diluted EPS to be in the range of $5.75 to $7.25.

Conference Call

The Company will host a conference call to discuss its fourth quarter 2022 financial results, today at 4:30 p.m. ET (1:30 p.m. PT). The call can be accessed at (877) 300-8521, conference ID 10174731. The conference call will be simultaneously available by webcast, which can be accessed by going to the Company's website at www.icumed.com, clicking on the Investors tab, clicking on Event Calendar and clicking on the Webcast icon and following the prompts. The webcast will also be available by replay.

About ICU Medical

ICU Medical (Nasdaq:ICUI) is a global leader in infusion systems, infusion consumables and high-value critical care products used in hospital, alternate site and home care settings. Our team is focused on providing quality, innovation and value to our clinical customers worldwide. ICU Medical is headquartered in San Clemente, California. More information about ICU Medical can be found at www.icumed.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements contain words such as ''will,'' ''expect,'' ''believe,'' ''could,'' ''would,'' ''estimate,'' ''continue,'' ''build,'' ''expand'' or the negative thereof or comparable terminology, and may include (without limitation) information regarding the Company's expectations, goals or intentions regarding the future. These forward-looking statements are based on management's current expectations, estimates, forecasts and projections about the Company and assumptions management believes are reasonable, all of which are subject to risks and uncertainties that could cause actual results and events to differ materially from those stated in the forward-looking statements. These risks and uncertainties include, but are not limited to, decreased demand for the Company's products, decreased free cash flow, changes in product mix, increased competition from competitors, lack of growth or improving efficiencies, unexpected changes in the Company's arrangements with its largest customers, the impact from fluctuations in foreign currency exchange rates, the impact of inflation on raw materials, freight charges and labor, rising interest rates, the impact of the ongoing COVID-19 pandemic on the Company and our financial results and the Company's ability to meet expectations regarding integration of the Smiths Medical business. Future results are subject to risks and uncertainties, including the risk factors, and other risks and uncertainties, described in the Company's filings with the Securities and Exchange Commission, which include those in the Company's most recent Annual Report on Form 10-K, as updated by the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2022 and our subsequent filings. Forward-looking statements contained in this press release are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

ICU MEDICAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

	December 31, 2022				December 31, 2021
	(Unaudited)				(1)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	208,784			$	552,827
Short-term investment securities		4,224				14,420
TOTAL CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENT SECURITIES		213,008				567,247
Accounts receivable, net of allowance for doubtful accounts		221,719				105,894
Inventories		696,009				290,235
Prepaid income taxes		15,528				19,586
Prepaid expenses and other current assets		88,932				46,847
TOTAL CURRENT ASSETS		1,235,196				1,029,809
PROPERTY, PLANT AND EQUIPMENT, net		636,113				468,365
OPERATING LEASE RIGHT-OF-USE ASSETS		74,864				39,847
LONG-TERM INVESTMENT SECURITIES		516				4,620
GOODWILL		1,449,258				43,439
INTANGIBLE ASSETS, net		982,766				188,311
DEFERRED INCOME TAXES		31,466				42,604
OTHER ASSETS		105,462				63,743
TOTAL ASSETS	$	4,515,641			$	1,880,738
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	215,902			$	81,128
Accrued liabilities		242,769				118,195
Current portion of long-term obligations		29,688				—
Income tax payable		6,200				1,454
TOTAL CURRENT LIABILITIES		494,559				200,777
CONTINGENT EARN-OUT LIABILITY		25,572				2,589
LONG-TERM OBLIGATIONS		1,623,675				—
OTHER LONG-TERM LIABILITIES		114,104				41,830
DEFERRED INCOME TAXES		126,007				1,490
INCOME TAX LIABILITY		41,796				18,021
COMMITMENTS AND CONTINGENCIES		—				—
STOCKHOLDERS’ EQUITY:
Convertible preferred stock, $1.00 par value; Authorized — 500 shares; Issued and outstanding — none		—				—
Common stock, $0.10 par value; Authorized — 80,000 shares; Issued —23,995 and 21,280 shares at December 31, 2022 and December 31, 2021, respectively, and outstanding — 23,993 and 21,280 shares at December 31, 2022 and December 31, 2021, respectively		2,399				2,128
Additional paid-in capital		1,331,249				721,412
Treasury stock, at cost		(243	)			(27	)
Retained earnings		837,501				911,787
Accumulated other comprehensive loss		(80,978	)			(19,269	)
TOTAL STOCKHOLDERS' EQUITY		2,089,928				1,616,031
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	4,515,641			$	1,880,738

______________________________________________________
⁽¹⁾ December 31, 2021 balances were derived from audited consolidated financial statements.

ICU MEDICAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except per share data)

	Three months ended December 31,								Twelve months ended December 31,
		2022				2021				2022				2021
TOTAL REVENUES	$	578,014			$	340,525			$	2,279,997			$	1,316,308
COST OF GOODS SOLD		403,069				213,035				1,582,236				824,818
GROSS PROFIT		174,945				127,490				697,761				491,490
OPERATING EXPENSES:
Selling, general and administrative		142,933				81,456				608,345				302,583
Research and development		23,446				13,166				92,984				47,498
Restructuring, strategic transaction and integration		9,626				9,043				71,421				18,037
Change in fair value of contingent earn-out		(838	)			—				(32,091	)			—
Contract settlement		—				—				—				127
TOTAL OPERATING EXPENSES		175,167				103,665				740,659				368,245
(LOSS) INCOME FROM OPERATIONS		(222	)			23,825				(42,898	)			123,245
INTEREST (EXPENSE) INCOME, net		(20,073	)			366				(66,375	)			1,982
OTHER EXPENSE, net		(1,152	)			(854	)			(5,136	)			(2,041	)
(LOSS) INCOME BEFORE INCOME TAXES		(21,447	)			23,337				(114,409	)			123,186
BENEFIT (PROVISION) FOR INCOME TAXES		5,911				(3,412	)			40,123				(20,051	)
NET (LOSS) INCOME	$	(15,536	)		$	19,925			$	(74,286	)		$	103,135
NET (LOSS) INCOME PER SHARE
Basic	$	(0.65	)		$	0.94			$	(3.11	)		$	4.86
Diluted	$	(0.65	)		$	0.91			$	(3.11	)		$	4.74
WEIGHTED AVERAGE NUMBER OF SHARES
Basic		23,988				21,257				23,868				21,206
Diluted		23,988				21,807				23,868				21,781

ICU MEDICAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In thousands) 

	Twelve months ended December 31,
		2022				2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income	$	(74,286	)		$	103,135
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Depreciation and amortization		235,151				89,698
Amortization of inventory step-up		26,519				—
Noncash lease expense		23,651				9,594
Provision for doubtful accounts		1,036				345
Provision for warranty and returns		4,902				831
Stock compensation		36,025				27,341
Loss on disposal of property, plant and equipment and other assets		2,010				1,652
Disposition of certain assets		(374	)			—
Bond premium amortization		264				655
Debt issuance costs amortization		6,972				240
Change in fair value of contingent earn-out		(32,091	)			—
Product-related charges		—				3,380
Usage of spare parts		11,924				13,046
Other		(103	)			2,582
Changes in operating assets and liabilities, net of amounts acquired:
Accounts receivable		(19,151	)			13,755
Inventories		(201,095	)			20,815
Prepaid expenses and other current assets		22,903				(7,973	)
Other assets		(21,290	)			(21,038	)
Accounts payable		37,472				2,347
Accrued liabilities		(55,834	)			6,259
Income taxes, including excess tax benefits and deferred income taxes		(66,734	)			874
Net cash (used in) provided by operating activities		(62,129	)			267,538
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment		(90,311	)			(68,542	)
Proceeds from sale of assets		989				218
Business acquisitions, net of cash acquired		(1,844,164	)			(14,452	)
Intangible asset additions		(9,018	)			(12,627	)
Investments in non-marketable equity investments		—				(3,250	)
Purchases of investment securities		(3,397	)			(10,034	)
Proceeds from sale and maturities of investment securities		36,433				18,000
Net cash used in investing activities		(1,909,468	)			(90,687	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of long-term debt, net of lender debt issuance costs		1,664,362				—
Principal repayments of long-term debt		(22,375	)			—
Payment of third-party debt issuance costs		(2,177	)			—
Proceeds from exercise of stock options		8,785				9,372
Payments on finance leases		(680	)			(607	)
Payment of contingent earn-out		—				(17,300	)
Tax withholding payments related to net share settlement of equity awards		(10,883	)			(8,335	)
Net cash provided by (used in) financing activities		1,637,032				(16,870	)
Effect of exchange rate changes on cash		(9,478	)			(3,251	)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(344,043	)			156,730
CASH AND CASH EQUIVALENTS, beginning of period		552,827				396,097
CASH AND CASH EQUIVALENTS, end of period	$	208,784			$	552,827

Use of Non-GAAP Financial Information

This press release contains financial measures that are not calculated in accordance with U.S. generally accepted accounting principles ("GAAP"). The non-GAAP financial measures should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. There are material limitations in using these non-GAAP financial measures because they are not prepared in accordance with GAAP and may not be comparable to similarly titled non-GAAP financial measures used by other companies, including peer companies. Our management believes that the non-GAAP data provides useful supplemental information to management and investors regarding our performance and facilitates a more meaningful comparison of results of operations between current and prior periods. We use non-GAAP financial measures in addition to and in conjunction with GAAP financial measures to analyze and assess the overall performance of our business, in making financial, operating and planning decisions, and in determining executive incentive compensation.

The non-GAAP financial measures include adjusted EBITDA, adjusted revenue, adjusted gross profit, adjusted selling, general and administrative, adjusted research and development, adjusted restructuring, strategic transaction and integration, adjusted change in fair value of contingent earn-out, adjusted (loss) income from operations, adjusted other expense, net, adjusted (loss) income before income taxes, adjusted benefit (provision) for income taxes, adjusted net (loss) income and adjusted diluted (loss) earnings per share, all of which exclude special items because they are highly variable or unusual and impact year-over-year comparisons.

For the three months ended December 31, 2022 and 2021, special items include the following:

Stock compensation expense: Stock-based compensation is generally fixed at the time the stock-based instrument is granted and amortized over a period of several years. The value of stock options is determined using a complex formula that incorporates factors, such as market volatility, that are beyond our control. The value of our restricted stock awards is determined using the grant date stock price, which may not be indicative of our operational performance over the expense period. Additionally, in order to establish the fair value of performance-based stock awards, which are currently an element of our ongoing stock-based compensation, we are required to apply judgment to estimate the probability of the extent to which performance objectives will be achieved. Based on the above factors, we believe it is useful to exclude stock-based compensation in order to better understand our operating performance.

Intangible asset amortization expense: We do not acquire businesses or capitalize certain patent costs on a predictable cycle. The amount of purchase price allocated to intangible assets and the term of amortization can vary significantly and are unique to each acquisition. Capitalized patent costs can vary significantly based on our current level of development activities. We believe that excluding amortization of intangible assets provides the users of our financial statements with a consistent basis for comparison across accounting periods.

Restructuring, strategic transaction and integration: We incur restructuring and strategic transaction charges that result from events, which arise from unforeseen circumstances and/or often occur outside of the ordinary course of our ongoing business. Although these events are reflected in our GAAP financial statements, these unique transactions may limit the comparability of our ongoing operations with prior and future periods.

Change in fair value of contingent earn-out: We exclude the impact of certain amounts recorded in connection with business combinations. We exclude items that are either non-cash or not normal, recurring operating expenses due to their nature, variability of amounts, and lack of predictability as to occurrence and/or timing.

Adjustment to reverse the cost recognition related to the purchase accounting write-up of inventory to fair market value: The inventory step-up represents the expense recognition of fair value adjustments in excess of the historical cost basis of inventory obtained through acquisition, these charges are outside of our normal operations and are excluded.

Quality system and product-related remediation: We exclude certain quality system product-related remediation charges in determining our non-GAAP financial measures as they may limit the comparability of our ongoing operations with prior and future periods and distort the evaluation of our normal operating performance.

Disposition of certain assets: Occasionally, we may sell certain assets. We exclude the non-cash gain/loss on the disposition of these assets in determining our non-GAAP financial measures as they may limit the comparability of our ongoing operations with prior and future periods and distort the evaluation of our normal operating performance.

From time to time in the future, there may be other items that we may exclude if we believe that doing so is consistent with the goal of providing useful information to investors and management.

In addition to the above special items, Adjusted EBITDA additionally excludes the following items from net income:

Depreciation expense: We exclude depreciation expense in deriving adjusted EBITDA because companies utilize productive assets of different ages and the depreciable lives can vary significantly resulting in considerable variability in depreciation expense among companies.

Interest, net: We exclude interest in deriving adjusted EBITDA as interest can vary significantly among companies depending on a company's level of income generating instruments and/or level of debt.

Taxes: We exclude taxes in deriving adjusted EBITDA as taxes are deemed to be non-core to the business and may limit the comparability of our ongoing operations with prior and future periods and distort the evaluation of our normal operating performance.

We also present Free cash flow as a non-GAAP financial measure as management believes that this is an important measure for use in evaluating overall company financial performance as it measures our ability to generate additional cash flow from business operations. Free cash flow should be considered in addition to, rather than as a substitute for, net income as a measure of our performance or net cash (used in) provided by operating activities as a measure of our liquidity. Additionally, our definition of free cash flow is limited and does not represent residual cash flows available for discretionary expenditures due to the fact that the measure does not deduct the payments required for debt service and other obligations or payments made for business acquisitions. Therefore, we believe it is important to view free cash flow as supplemental to our entire statement of cash flows.

The following tables reconcile our GAAP and non-GAAP financial measures:

ICU MEDICAL, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)
(In thousands, except per share data)

	Adjusted EBITDA
	Three months ended December 31,
		2022				2021
GAAP net (loss) income	$	(15,536	)		$	19,925
Non-GAAP adjustments:
Interest, net		20,073				(366	)
Stock compensation expense		7,428				8,105
Depreciation and amortization expense		56,813				23,133
Restructuring, strategic transaction and integration		9,626				9,043
Change in fair value of contingent earn-out		(838	)			—
Adjustment to reverse the cost recognition related to the purchase accounting write-up of inventory to fair value		3,843				912
Quality system and product-related charges		21,262				—
Gain on disposition of assets		(374	)			—
(Benefit) provision for income taxes		(5,911	)			3,412
Total non-GAAP adjustments		111,922				44,239
Adjusted EBITDA	$	96,386			$	64,164

ICU MEDICAL, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)
(In thousands, except percentages and per share)

The company’s U.S. GAAP results for the three months ended December 31, 2022 included special items which impacted the U.S. GAAP measures as follows:

	Total revenues			Gross profit			Selling, general and administrative			Research and development			Restructuring, strategic transaction and integration			Change in fair value of contingent earn-out			(Loss) income from operations			Other expense, net			(Loss) income before income taxes			Benefit (provision) for income taxes			Net (loss) income			Diluted (loss) earnings per share
Reported (GAAP)	$	578,014		$	174,945		$	142,933		$	23,446		$	9,626		$	(838	)	$	(222	)	$	(1,152	)	$	(21,447	)	$	5,911		$	(15,536	)	$	(0.65	)
Reported percent of total revenues (or percent of (loss) income before income taxes for benefit (provision) for income taxes)					30	%		25	%		4	%		2	%		—	%		—	%		—	%		(4	)%		27.6	%		(3	)%
Contract manufacturing		(13,127	)		—			—			—			—			—			—			—			—			—			—
Stock compensation expense		—			1,702			(5,287	)		(439	)		—			—			7,428			—			7,428			(1,783	)		5,645			0.24
Amortization expense		—			45			(30,433	)		—			—			—			30,478			—			30,478			(7,193	)		23,285			0.95
Restructuring, strategic transaction and integration		—			—			—			—			(9,626	)		—			9,626			—			9,626			(1,887	)		7,739			0.32
Change in fair value of contingent earn-out		—			—			—			—			—			838			(838	)		—			(838	)		—			(838	)		(0.03	)
Adjustment to reverse the cost recognition related to the purchase accounting write-up of inventory to fair value		—			3,843			—			—			—			—			3,843			—			3,843			(915	)		2,928			0.12
Quality system and product-related remediation		—			21,262			—			—			—			—			21,262			—			21,262			(5,167	)		16,095			0.67
Gain on disposition of assets		—			—			—			—			—			—			—			(374	)		(374	)		—			(374	)		(0.02	)
Adjusted (Non-GAAP)	$	564,887		$	201,797		$	107,213		$	23,007		$	—		$	—		$	71,577		$	(1,526	)	$	49,978		$	(11,034	)	$	38,944		$	1.60
Adjusted percent of total revenues (or percent of (loss) income before income taxes for benefit (provision) for income taxes)					36	%		19	%		4	%		—	%		—	%		13	%		—	%		9	%		22.1	%		7	%

ICU MEDICAL, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)(continued)
(In thousands, except percentages and per share)

The company’s U.S. GAAP results for the three months ended December 31, 2021 included special items which impacted the U.S. GAAP measures as follows:

	Total revenues			Gross profit			Selling, general and administrative			Research and development			Restructuring, strategic transaction and integration			Income from operations			Income before income taxes			Provision for income taxes			Net income			Diluted earnings per share
Reported (GAAP)	$	340,525		$	127,490		$	81,456		$	13,166		$	9,043		$	23,825		$	23,337		$	(3,412	)	$	19,925		$	0.91
Reported percent of total revenues (or percent of income before income taxes for benefit provision for income taxes)					37	%		24	%		4	%		3	%		7	%		7	%		14.6	%		6	%
Contract manufacturing		(10,605	)		—			—			—			—			—			—			—			—
Stock compensation expense		—			912			(6,892	)		(301	)		—			8,105			8,105			(1,945	)		6,160			0.28
Amortization expense		—			45			(6,320	)		—			—			6,365			6,365			(1,503	)		4,862			0.22
Restructuring, strategic transaction and integration		—			—			—			—			(9,043	)		9,043			9,043			(766	)		8,277			0.38
Adjustment to reverse the cost recognition related to the purchase accounting write-up of inventory to fair value		—			912			—			—			—			912			912			(173	)		739			0.03
Adjusted (Non-GAAP)	$	329,920		$	129,359		$	68,244		$	12,865		$	—		$	48,250		$	47,762		$	(7,799	)	$	39,963		$	1.82
Adjusted percent of total revenues (or percent of income before income taxes for provision for income taxes)					39	%		21	%		4	%		—	%		15	%		14	%		16.3	%		12	%

ICU MEDICAL, INC. AND SUBSIDIARIES
Reconciliation of Net Cash (Used in) Provided by Operating Activities to Free Cash Flow (Unaudited)
(In thousands)

	Three months ended December 31								Twelve months ended December 31
		2022				2021				2022				2021
Net cash (used in) provided by operating activities	$	(1,711	)			82,621			$	(62,129	)		$	267,538
Purchase of property, plant and equipment		(21,596	)			(22,078	)			(90,311	)			(68,542	)
Proceeds from sale of assets		56				—				989				218
Free cash flow	$	(23,251	)		$	60,543			$	(151,451	)		$	199,214

ICU MEDICAL, INC. AND SUBSIDIARIES
Fiscal Year 2023
Outlook (Unaudited)
(In millions, except per share data)

	Low End of Guidance				High End of Guidance
GAAP net loss	$	(73	)		$	(37	)
Non-GAAP adjustments:
Interest, net		96				96
Stock compensation expense		42				42
Depreciation and amortization expense		230				230
Restructuring, strategic transaction and integration		41				41
Quality and regulatory initiatives and remediation		61				61
Benefit for income taxes		(22	)			(8	)
Total non-GAAP adjustments	$	448			$	462
Adjusted EBITDA	$	375			$	425
GAAP diluted loss per share	$	(3.00	)		$	(1.50	)
Non-GAAP adjustments:
Stock compensation expense		1.71				1.71
Amortization expense		5.51				5.51
Restructuring, strategic transaction and integration		1.67				1.67
Quality and regulatory initiatives and remediation		2.49				2.49
Estimated income tax impact from adjustments		(2.63	)			(2.63	)
Adjusted diluted earnings per share	$	5.75			$	7.25

CONTACT:
ICU Medical, Inc.
Brian Bonnell, Chief Financial Officer
(949) 366-2183

ICR, Inc.
John Mills, Partner
(646) 277-1254

FAQ

What were ICU Medical's Q4 2022 revenue results?

ICU Medical reported Q4 2022 revenues of $578 million, a significant increase from $340.5 million in Q4 2021.

What is the adjusted diluted EPS for ICU Medical in Q4 2022?

The adjusted diluted EPS for Q4 2022 was $1.60, down from $1.82 in Q4 2021.

What are ICU Medical's financial projections for FY 2023?

ICU Medical expects a net loss between $(73) million and $(37) million and adjusted EBITDA between $375 million and $425 million for FY 2023.

How did ICU Medical's GAAP gross margin change in Q4 2022?

The GAAP gross margin for Q4 2022 declined to 30%, down from 37% in Q4 2021.