Segments and Geographic Information

12 Months Ended

Jan. 02, 2022

Segment Reporting [Abstract]

Segments and Geographic Information

(19) Segments and geographic information

The Company is engaged in the design, development, manufacturing, marketing, distribution and sale of diagnostic instruments and assays for hospitals, laboratories and blood and plasma centers worldwide. The Company manages its business by geographic location.

The Company has five geographically based operating segments: Americas, Europe the Middle East and Africa (“EMEA”), Greater China, Japan and Asia Pacific (“ASPAC”). The Company’s reportable segments consist of Americas, EMEA and Greater China. Although the reportable segments provide similar products and services, each one is managed separately to better align with the market dynamics of each geographic region. Japan and ASPAC are immaterial operating segments not considered as reportable segments and are included in “Other.”

The Company’s CEO is the chief operating decision maker (“CODM”). The CODM evaluates segment profitability using Net revenue and effective January 4, 2021, the Company changed the basis for which it measures segment profit or loss from Management EBITDA to Adjusted EBITDA.

Net revenue for geographic segments are generally based on the location of customers and sales through the Company’s operations located in those geographic locations. Adjusted EBITDA for each segment is defined as segment net income (loss), plus interest expense, income taxes, depreciation and amortization, and eliminates certain non-operating income or expense and impacts of certain noncash, unusual or other items that are included in net income (loss) that are not considered by management to be indicative of ongoing operating performance. Management EBITDA was defined as Adjusted EBITDA, further adjusted for other items, including realized foreign currency gains and losses, impact from adoption of accounting standards, costs in connection with COVID-19 and other immaterial management adjustments. Beginning in fiscal year 2021, the CODM reviews the Company’s segment results on an Adjusted EBITDA basis. The Company has retroactively recast its fiscal year 2020 results on the new basis for comparability. However, it is impracticable for the Company to retroactively recast its segments results for fiscal year 2019. Accordingly, fiscal year 2019 segment results below are presented on a Management EBITDA basis.

Net revenue by segment is as follows:

	Fiscal Year Ended
	January 2, 2022		January 3, 2021		December 29, 2019
Americas	$	1,228.9	$	1,067.3	$	1,042.5
EMEA		276.3		240.6		251.5
Greater China		274.4		229.6		242.5
Other		263.2		228.7		265.0
Net revenue	$	2,042.8	$	1,766.2	$	1,801.5

Adjusted EBITDA by segment is as follows:

	Fiscal Year Ended
	January 2, 2022			January 3, 2021
Americas	$	516.6		$	463.1
EMEA		63.9			41.9
Greater China		129.2			108.0
Other		79.9			65.9
Total Segment Adjusted EBITDA		789.6			678.8
Corporate (1)		(241.5	)		(230.4	)
Depreciation and amortization		(328.1	)		(325.9	)
Interest expense, net		(146.0	)		(198.2	)
Loss on extinguishment of debt		(50.3	)		(12.6	)
Stock-based compensation		(22.2	)		(8.6	)
Restructuring and severance-related costs		(8.2	)		(11.7	)
Arbitration award		7.4			—
Quidel acquisition-related costs		(7.0	)		—
Tax indemnification expense, net		(0.8	)		(31.2	)
Costs related to Ortho's initial public and secondary offerings		(5.4	)		(7.8	)
EU medical device regulation transition costs		(4.0	)		(4.3	)
Unrealized foreign currency exchange losses		—			(63.0	)
Other adjustments		(9.5	)		(10.5	)
Loss before provision for (benefit from) income taxes	$	(26.0	)	$	(225.3	)

(1) Corporate primarily consists of costs related to executive and staff functions, including certain finance, human resources, manufacturing, and information technology, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies, and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. The Company’s Corporate function also includes debt and stock-based employee compensation expense associated with all employee stock-based awards.

Management EBITDA by segment for the fiscal year ended December 29, 2019 is as follows:

	Fiscal Year Ended
	December 29, 2019
Americas	$	418.4
EMEA		54.9
Greater China		118.4
Other		88.8
Total Segment Management EBITDA		680.5
Corporate (1)		(177.9	)
Depreciation and amortization		(327.5	)
Interest expense, net		(231.4	)
Stock-based compensation		(18.6	)
Restructuring and severance-related costs		(36.0	)
Tax indemnification expense, net		(29.2	)
EU medical device regulation transition costs		(3.2	)
Unrealized foreign currency exchange gains		19.6
Other adjustments		(35.2	)
Management adjustments and realized foreign exchange losses		(21.9	)
Loss before provision for (benefit from) income taxes	$	(180.8	)

(1) Corporate primarily consists of costs related to executive and staff functions, including certain finance, human resources, manufacturing, and information technology, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies, and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. The Company’s Corporate function also includes debt and stock-based employee compensation expense associated with all employee stock-based awards.

The CODM does not review capital expenditures, total depreciation and amortization or total assets by segment, and therefore this information has been excluded as it does not comprise part of management’s key performance metrics.

Net revenues for the Company’s country of domicile, countries with significant concentrations, and all other countries were as follows:

	Fiscal Year Ended
	January 2, 2022		January 3, 2021		December 29, 2019
Net revenue
United Kingdom	$	27.5	$	21.9	$	19.9
United States		1,016.1		901.2		855.1
Greater China		274.4		229.6		242.5
Other countries		724.8		613.5		684.0
Total net revenue	$	2,042.8	$	1,766.2	$	1,801.5

Property, plant and equipment, net and Right-of-use assets for the Company’s country of domicile, countries with significant concentrations, and all other countries were as follows:

	January 2, 2022		January 3, 2021
Long-lived assets
United Kingdom	$	107.2	$	105.6
United States		470.0		507.5
Other countries		244.5		245.6
Total long-lived assets	$	821.7	$	858.7