SEGMENT AND GEOGRAPHIC INFORMATION

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

SEGMENT AND GEOGRAPHIC INFORMATION

SEGMENT AND GEOGRAPHIC INFORMATION

Starting in the first quarter of 2012, because of changes in how the Company internally manages and reports the results of its businesses to its chief operating decision maker, the Company began reporting five reportable segments. The five reportable segments and a description of their activities are described below:

• The U.S. Neurosurgery segment sells a full line of products specifically for neurosurgery and critical care such as tissue ablation equipment, dural repair products, cerebral spinal fluid management devices, intracranial monitoring equipment, and cranial stabilization equipment.

• The U.S. Instruments business sells more than 60,000 instrument patterns and surgical products and lighting to hospitals, surgery centers, and dental, podiatry, and veterinary offices.

• The U.S. Extremities segment includes the U.S. extremity reconstruction business, which includes such offerings as skin and wound repair, bone and joint fixation, implants in the upper and lower extremities, bone grafts and nerve and tendon repair.

• The U.S. Spine and Other segment includes (i) the U.S. Spine business, which focuses on spinal fusion, spinal implants, and deformity correction, together with bone graft substitutes and other related medical devices that are used to enhance the repair and regeneration of bone in various types of orthopedic surgical procedures, and (ii) the Private Label business, which sells the Company’s regenerative technology and other products to strategic partners.

• The International segment sells similar products to those discussed above, but are managed through the following geographies: (i) Europe, Middle East and Africa, and (ii) Latin/South America, Asia-Pacific, Australia, New Zealand and Canada.

The Corporate and other category includes (i) various legal, finance, executive, and human resource functions, (ii) brand management, (iii) share-based compensation costs, and (iv) costs related to procurement, manufacturing operations and logistics for the Company’s entire organization.

The operating results of the various reportable segments as presented are not comparable to one another because (i) certain operating segments are more dependent than others on corporate functions for unallocated general and administrative and/or operational manufacturing functions, and (ii) the Company does not allocate certain manufacturing costs and general and administrative costs to the operating segment results.

Net sales and profit by reportable segment for the years ended December 31, 2014, 2013 and 2012 are as follows:

	Years Ended December 31,
	2014			2013			2012
	(In thousands)
Segment Net Sales
U.S. Neurosurgery	$	244,603		$	172,250		$	171,278
U.S. Instruments *	157,816			163,908			166,921
U.S. Extremities *	143,384			128,336			116,279
U.S. Spine and Other *	171,363			182,007			192,516
International	211,139			189,713			183,877
Total revenues	$	928,305		$	836,214		$	830,871
Segment Profit
U.S. Neurosurgery	$	133,165		$	83,211		$	91,070
U.S. Instruments *	48,036			49,348			50,277
U.S. Extremities *	61,343			47,880			43,952
U.S. Spine and Other *	53,318			10,136			57,388
International	69,663			56,869			61,336
Segment profit	365,525			247,444			304,023
Amortization	(12,400)			(12,697)			(18,536)
Corporate and other	(287,584		)	(244,903		)	(211,705		)
Operating income (loss)	$	65,541		$	(10,156	)	$	73,782

* Certain revenues and profits have been reclassified from the U.S. Extremities segment to the U.S. Instruments segment and the U.S. Spine and Other segment for the years ended December 31, 2013 and 2012.

The Company does not allocate any assets to the reportable segments, and, therefore, no asset information is reported to the chief operating decision maker and disclosed in the financial information for each segment.

Revenue by major product category consisted of the following:

	Years Ended December 31,
	2014		2013		2012
	(In thousands)
Orthopedics **	$	370,082	$	370,359	$	364,714
Neurosurgery	371,676		278,672		277,527
Instruments **	186,547		187,183		188,630
Total revenues	$	928,305	$	836,214	$	830,871

** Certain revenues have been reclassified from the Orthopedics category to the Instruments category for the years ended December 31, 2013 and 2012.

The Company attributes revenue to geographic areas based on the location of the customer. There are certain revenues managed by the various U.S. segments above that are generated from non-U.S. customers and therefore included in Europe and the Rest of World revenues below.

Total revenue, net and long-lived assets (tangible) by major geographic area are summarized below:

	United States*		Europe		Rest of the World		Consolidated
	(In thousands)
Total revenue, net:
2014	$	714,040	$	105,697	$	108,568	$	928,305
2013	642,694		93,977		99,543		836,214
2012	642,830		90,920		97,121		830,871
Total long-lived assets:
2014	$	197,897	$	21,218	$	1,239	$	220,354
2013	187,608		20,010		1,030		208,648

* Includes long-lived assets in Puerto Rico.