Segment Information

9 Months Ended

Sep. 30, 2012

Segment Reporting [Abstract]

Segment Information

11. SEGMENT INFORMATION

We evaluate our operating segments by our major product lines: knee implants, hip implants, biologics and spine, extremity implants and other products. The “other products” segment includes miscellaneous sales categories, such as surgical instruments held for sale, bone cement, instrument rental fees, shipping charges, and other implant product lines. Evaluation of the performance of operating segments is based on their respective income from operations before taxes, interest income and expense, and nonrecurring items. Intersegment sales and transfers are not significant. The accounting policies of the reportable segments are the same as those described in Note 2 of the notes to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2011.

Total assets not identified with a specific segment are listed as “corporate” and include cash and cash equivalents, accounts receivable, income taxes receivable, deposits and prepaid expenses, deferred tax assets, land, facilities, office furniture and computer equipment, notes receivable, and other investments. Depreciation and amortization on corporate assets is allocated to the product segments for purposes of evaluating the income (loss) from operations, and capitalized surgical instruments are allocated to the appropriate product line supported by those assets.

Total gross assets held outside the United States as of September 30, 2012, was $46.2 million. Included in these assets was $24.2 million in surgical instrumentation, stated gross as it is impracticable to account for depreciation on these assets by region.

Summarized information concerning our reportable segments is shown in the following table (in thousands):

Three Months Ended September 30,	Knee		Hip			Biologics & Spine			Extremity		Other			Corporate			Total
2012
Net sales	$	18,220	$	9,245		$	5,943		$	12,215	$	5,647		$	—		$	51,270
Segment profit (loss)	1,787		527			23			2,528		(352		)	(240		)	4,273
Total assets, net	68,967		30,245			20,594			21,154		13,154			88,279			242,393
Capital expenditures	810		438			401			1,146		237			946			3,978
Depreciation and Amortization	1,804		604			299			383		153			911			4,154
2011
Net sales	$	17,908	$	7,990		$	5,415		$	9,780	$	6,185		$	—		$	47,278
Segment profit (loss)	2,650		(136		)	(143		)	345		(612		)	(299		)	1,805
Total assets, net	62,380		31,445			22,020			16,336		8,872			92,988			234,041
Capital expenditures	1,420		597			284			913		21			691			3,926
Depreciation and Amortization	1,351		592			354			287		116			1,362			4,062

Nine Months Ended September 30,	Knee		Hip		Biologics & Spine		Extremity		Other			Corporate			Total
2012
Net sales	$	60,678	$	30,465	$	18,031	$	37,188	$	18,721		$	—		$	165,083
Segment profit (loss)	7,149		1,777		561		7,819		(2,316		)	(897		)	14,093
Total assets, net	68,967		30,245		20,594		21,154		13,154			88,279			242,393
Capital expenditures	5,612		1,654		1,436		3,043		536			2,583			14,864
Depreciation and Amortization	5,239		1,895		943		1,104		448			2,976			12,605
2011
Net sales	$	59,946	$	24,393	$	18,423	$	28,874	$	20,693		$	—		$	152,329
Segment profit (loss)	7,195		579		516		3,624		(1,947		)	100			10,067
Total assets, net	62,380		31,445		22,020		16,336		8,872			92,988			234,041
Capital expenditures	5,591		3,692		1,452		2,400		1,519			3,653			18,307
Depreciation and Amortization	4,143		1,659		968		773		364			3,969			11,876

Geographic distribution of our sales is summarized in the following table (in thousands):

Three Months Ended September 30,	2012		2011		% Inc/Decr
Domestic sales	$	35,294	$	31,451	12.2
International sales	15,976		15,827		0.9
Total sales	$	51,270	$	47,278	8.4

Nine Months Ended September 30,	2012		2011		% Inc/Decr
Domestic sales	$	107,307	$	99,049	8.3
International sales	57,776		53,280		8.4
Total sales	$	165,083	$	152,329	8.4