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Wright Medical Group N.V. Reports 2015 Third Quarter Financial Results

Third Quarter Legacy Wright Global Foot and Ankle Net Sales Increase 20% as Reported and
23% Constant Currency

Third Quarter Legacy Wright Global Total Ankle Replacement Sales Increase 61% as Reported

Third Quarter Legacy Tornier Global Upper Extremity Revenue Increases 7% as Reported and
13% Constant Currency 

Provides Pro Forma Guidance for 2015 for Combined Company Following Merger With Tornier N.V.

AMSTERDAM, The Netherlands, Nov. 04, 2015 (GLOBE NEWSWIRE) -- Wright Medical Group N.V. (NASDAQ:WMGI) today reported financial results for Wright Medical Group, Inc. for its third quarter ended September 30, 2015 and financial results for Tornier N.V. for its third quarter ended September 27, 2015.   As previously announced, Wright and Tornier completed their merger on October 1, 2015, subsequent to the end of each company’s third quarter.  Certain preliminary, unaudited non-GAAP pro forma financial results for the combined Wright Medical Group N.V. can be found on Wright’s website at ir.wright.com.

Wright Medical Group, Inc. Third Quarter 2015 Highlights

Net sales totaled $80.1 million during the third quarter ended September 30, 2015, representing a 12% increase as reported and 16% increase on a constant currency basis compared to the third quarter of 2014.

Robert Palmisano, president and chief executive officer, commented, “Third quarter results for our legacy Wright business continued to demonstrate the strong growth of our U.S. foot and ankle business and ongoing improvement in our international business.  Specifically, our U.S. foot and ankle business grew 24% in the quarter, which was another quarter of significant growth driven by improved sales force execution, medical education and strong contribution from new products, including the ongoing launch of our INFINITY total ankle system, which drove 54% sales growth in U.S. total ankle replacement.  In addition, our U.S. commercial launch activities for AUGMENT Bone Graft are off to a positive start following final FDA approval in September.  We believe this product, coupled with continued strong growth in our core U.S. foot and ankle business, will continue to fuel positive momentum for the remainder of the year and beyond.”  

Palmisano continued, “The close of our merger with Tornier marked a significant milestone for our company, creating the premier, high-growth Extremities and Biologics company uniquely positioned with leading technologies and specialized sales forces in three of the fastest growing areas of orthopaedics – Upper Extremities, Lower Extremities and Biologics.  Our focus now is on bringing our organizations together to accelerate our business momentum and minimize disruption, and we have gotten off to a strong start.  For the vast majority of the combined company revenue, we anticipate little to no sales force disruption due to integration.  Given the relatively low level of revenue that we anticipate will be directly impacted by the sales force integration and the amount of dis-synergy that we have targeted in our plan, we view the downside risk in this area to be low.  Like our dis-synergy plan, we view achieving our cost synergy target of $40 million to $45 million in year three as also low risk.  We have multiple opportunities to extend our leadership position in shoulder, accelerate our foot and ankle business through market expansion, and increase our biologics business through the launch of AUGMENT Bone Graft in the U.S.  In addition, I believe that our increased scale and scope will provide an accelerated path to profitability that will enable us to achieve our goal of adjusted EBITDA margins approaching 20% in three to four years and generate long-term value for our shareholders.” 

Net loss from continuing operations for the third quarter of 2015 totaled $62.7 million, or $(1.22) per diluted share, compared to net loss from continuing operations of $49.6 million, or $(0.99) per diluted share, in the third quarter of 2014.

Net loss from continuing operations for the third quarter of 2015 included a $14.6 million unrealized loss related to mark-to-market adjustments on contingent value rights (CVRs) issued in connection with the BioMimetic acquisition, a gain of $4.7 million related to mark-to-market adjustments on derivatives, $6.8 million of non-cash interest expense related to the 2017 Convertible Notes and 2020 Convertible Notes, and $19.9 million of transaction and transition costs.  Net loss from continuing operations for the third quarter of 2014 included an $18.5 million unrealized loss related to mark-to-market adjustments on CVRs issued in connection with the BioMimetic acquisition, $2.7 million of transaction and transition costs, $2.3 million of non-cash interest expense related to the 2017 Convertible Notes, $1.8 million of contingent consideration fair value adjustments, $1.2 million of costs associated with management changes, an unrealized loss of $1.0 million related to mark-to-market adjustments on derivatives, $0.9 million of patent dispute settlement costs, and $0.5 million of charges associated with distributor conversions and non-competes.  These 2014 charges were offset by a $2.8 million U.S. tax benefit within continuing operations recorded as a result of the U.S. pre-tax gain recognized within discontinued operations due to the sale of the OrthoRecon business.

The company's third quarter 2015 net loss from continuing operations, as adjusted for the above items, was $26.1 million, a decline from an adjusted net loss of $17.7 million in 2014, while diluted loss per share, as adjusted, decreased to $(0.51) in the third quarter of 2015 from $(0.35) in the third quarter of 2014.  The attached financial tables include a reconciliation of U.S. GAAP to “as adjusted” results.

The company's third quarter 2015 adjusted EBITDA from continuing operations, as defined in the GAAP to non-GAAP reconciliation provided later in this release, was negative $(10.3) million, compared to negative $(5.9) million in the same quarter of the prior year.  The attached financial tables include a reconciliation of U.S. GAAP to “as adjusted” results.

Cash and cash equivalents and marketable securities totaled $254.4 million as of the end of the third quarter of 2015, an increase of $24.5 million compared to the end of the fourth quarter of 2014, which was driven by completion of the 2020 convertible debt offering, offset by the Augment® Bone Graft approval CVR milestone payment and merger-related expenses.

Tornier N.V. Third Quarter 2015 Highlights

Tornier’s revenue for the third quarter of 2015 was $74.9 million compared to third quarter 2014 revenue of $76.7 million, a decrease of 2% as reported and an increase of 4% in constant currency. Foreign currency exchange rates negatively impacted third quarter 2015 reported revenue by $4.7 million.

Third quarter 2015 revenue of Tornier's extremities product categories totaled $66.1 million compared to $65.8 million during the prior year period, an increase of 0.5% as reported and an increase of 5% in constant currency.

  • Revenue from the upper extremities joints and trauma category was $52.6 million, an increase of 13% in constant currency over the same quarter in 2014. Growth was led by the Aequalis Ascend® family of shoulder joint replacement products, which continued to gain global surgeon acceptance. The consistent performance of the Tornier upper extremity joints and trauma category demonstrates the success of the company's strategy to deliver superior products with a differentiated sales force.
  • Revenue from Tornier's lower extremity joints and trauma category in the third quarter of 2015 was $10.9 million, a decrease of 18% in constant currency. As anticipated, distractions from the merger with Wright impacted Tornier’s lower extremities business.
  • Revenue from Tornier’s sports medicine and biologics product category was $2.7 million in the third quarter of 2015, a decrease of 4% in constant currency over the same quarter in 2014, reflecting a decline in Tornier’s soft tissue anchor and biologics products.

Tornier’s third quarter 2015 adjusted EBITDA, as defined in the GAAP to non-GAAP reconciliation provided later in this release, was $6.1 million, or 8.1% of reported revenue, compared to $4.0 million, or 5.3% of reported revenue, in the same quarter of the prior year.

Palmisano further commented, “Tornier’s third quarter performance highlights the strong momentum in its legacy upper extremities business, driven by an innovative product portfolio and clinically superior sales team.  Tornier’s U.S. upper extremity growth of 15% was approximately twice the market rate, driven by the AEQUALIS ASCEND FLEX shoulder system and the U.S. launch of the SIMPLICITI shoulder system, which is now in full market release.  As expected, the legacy Tornier lower extremities business experienced distractions related to our merger.  However, with the merger now closed, we can focus on leveraging the strengths of both companies and believe we have a very attractive combination of products and people to drive long-term growth and profitability for the combined business.”

Outlook

The company today provided its pro forma full-year 2015 guidance for Wright Medical Group N.V., which includes anticipated financial results for both the legacy Wright and Tornier businesses giving effect to the merger as if it had occurred on the first day of each fiscal year.  This combined guidance includes the impact of conforming the combined company’s fiscal calendars; the full-year impact of the divestiture of certain Tornier lower extremities products to Integra LifeSciences; and anticipated revenue dis-synergies and cost synergies related to the merger for 2015.  As a result of conforming the combined company’s fiscal calendars, the legacy Wright business will have four fewer selling days in the fourth quarter of 2015.

The company anticipates pro forma net sales for 2015 of approximately $636 million to $642 million.      

The company anticipates 2015 pro forma adjusted EBITDA from continuing operations, as described in the GAAP to non-GAAP reconciliation provided later in this release, of negative $(13.0) million to negative $(17.0) million

Underlying this guidance is the assumption that prior to the impact of conforming the combined company’s fiscal calendars and the impact of anticipated revenue dis-synergies, the legacy Wright U.S. foot and ankle business will continue to grow in the high teens, the legacy Tornier U.S. upper extremity business will continue to grow in the mid-teens, and the legacy Wright international business growth rates will continue to accelerate, in each case on a constant currency basis compared to fourth quarter of 2014.

The company estimates approximately 103.7 million ordinary shares outstanding for the fourth quarter of 2015.

The company continues to anticipate sales dis-synergies in the first 12 to 18 months following the close of the merger to be in the range of $25 million to $30 million and cost synergies in the range of $40 million to $45 million to be fully realized by the third year after completion of the merger.  Expense synergy opportunities include: public company expenses, overlapping support function and systems costs, as well as process and vendor consolidation opportunities across the business.

The company's pro forma adjusted EBITDA from continuing operations target excludes possible future acquisitions; other material future business developments; non-cash interest expense associated with the 2017 and 2020 Convertible Notes; due diligence, transaction and transition costs associated with acquisitions and divestitures; impairment charges, mark-to-market adjustments to the CVRs and non-cash mark-to-market derivative adjustments; charges associated with the February 2015 refinancing of its convertible debt; and the instrument use tax refund.  Further, this adjusted EBITDA target excludes any expenses, earnings or losses related to Wright’s divested OrthoRecon business and Tornier’s divested foot and ankle products.

The company's anticipated ranges for pro forma net sales and adjusted EBITDA from continuing operations are forward-looking statements, as are any other statements that anticipate or aspire to future events or performance.  They are subject to various risks and uncertainties that could cause the company's actual results to differ materially from the anticipated targets.  The anticipated targets are not predictions of the company's actual performance.  See the cautionary information about forward-looking statements in the “Safe-Harbor Statement” section of this press release. In addition, while pro forma data gives effect to the merger as if it had occurred on the first day of each fiscal year and enhances comparability of financial information between periods, pro forma data is not indicative of the results that actually would have been obtained if the merger had occurred as of the beginning of the fiscal year.

Supplemental Financial Information

To view the third quarter of 2015 supplemental financial information, visit ir.wright.com.  For updated information on Wright Medical Group N.V. revenue reporting changes and preliminary, combined non-GAAP pro forma historical financials, including third quarter of 2015, please refer to the presentation posted on Wright’s website at ir.wright.com in the “Financial Information” section.

Internet Posting of Information

Wright routinely posts information that may be important to investors in the “Investor Relations” section of its website at www.wright.com.  The company encourages investors and potential investors to consult Wright website regularly for important information about Wright.

Conference Call and Webcast

As previously announced, Wright will host a conference call starting at 3:30 p.m. Central Time today.  The live dial-in number for the call is 866-318-8617 (U.S.) / 617-399-5136 (International).  The participant passcode for the call is “Wright.”  A simultaneous webcast of the call will be available via Wright’s corporate website at www.wright.com.

A replay of the conference call by telephone will be available starting at 5:30 p.m. Central Time today and continuing through November 11, 2015.  To hear this replay, dial 888-286-8010 (U.S.) or 617-801-6888 (International) and enter the passcode 88327442.  A replay of the conference call will also be available via the internet starting today and continuing for at least 12 months.  To access a replay of the conference call via the internet, go to the “Investor Relations - Presentations/Calendar” section of the company's website located at www.wright.com.

The conference call may include a discussion of non-GAAP financial measures.  Reference is made to the most directly comparable GAAP financial measures, the reconciliation of the differences between the two financial measures, and the other information included in this press release, the Current Report on Form 8-K filed with the SEC today, or otherwise available in the “Investor Relations - Supplemental Financial Information” section of the company's website located at www.wright.com.

The conference call may include forward-looking statements.  See the cautionary information about forward-looking statements in the “Cautionary Note Regarding Forward-Looking Statements” section of this press release.

About Wright

Wright Medical Group N.V. is a global medical device company focused on Extremities and Biologics.  The company is committed to delivering innovative, value-added solutions improving quality of life for patients worldwide and is a recognized leader of surgical solutions for the upper extremity (shoulder, elbow, wrist and hand), lower extremity (foot and ankle) and biologics markets, three of the fastest growing segments in orthopedics.  For more information about Wright, visit www.wright.com.

Wright®, INFINITY®, Augment®, Tornier®, Aequalis®, Aequalis Ascend®, Aequalis Ascend® Flex™, and Simpliciti® are trademarks of Wright Medical Group N.V. and its subsidiaries, registered as indicated in the United States, and in other countries.  All other trademarks and trade names referred to in this release are the property of their respective owners.

Non-GAAP Financial Measures

To supplement the company’s consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP), the company uses certain non-GAAP financial measures in this release. Reconciliations of the non-GAAP financial measures used in this release to the most comparable U.S. GAAP measures for the respective periods can be found in tables later in this press release. Wright’s non-GAAP financial measures, include net sales, excluding the impact of foreign currency; operating income, as adjusted; net income, as adjusted; EBITDA, as adjusted; net income, as adjusted, per diluted share; effective tax rate, as adjusted; and free cash flow. Tornier’s non-GAAP financial measures include revenues on a constant currency basis; EBITDA; adjusted EBITDA; adjusted EBITDA margin; adjusted net loss; adjusted net loss per share; adjusted free cash flow; adjusted gross margin; adjusted gross margin percentage; adjusted operating expenses; and adjusted operating expenses as a percentage of revenue. In addition, the company uses pro forma net sales and pro forma adjusted EBITDA as non-GAAP financial measures in its financial guidance for 2015. The company's management believes that the presentation of these measures provides useful information to investors.  These measures may assist investors in evaluating the company's operations, period over period.  Wright’s non-GAAP financial measures exclude such items as costs associated with distributor conversions and non-competes, non-cash interest expense related to the company's 2017 Convertible Notes and 2020 Convertible Notes, write-off of the pro rata unamortized deferred financing costs and debt discount associated with the 2017 Convertible Notes, net gains and losses on mark-to-market adjustments on and settlements of derivative assets and liabilities, mark-to-market adjustments on CVRs, transaction and transition costs, all of which may be highly variable, difficult to predict and of a size that could have substantial impact on the company's reported results of operations for a period.  Tornier’s non-GAAP financial measures exclude such items as amortization of inventory step-up from acquisition; acquisition, integration and distribution transition costs; reversal of contingent consideration liability; instrument use tax refund; restructuring charges; merger-related costs; and reversal of valuation allowance from acquisition, all of which may be highly variable, difficult to predict and of a size that could have substantial impact on the company's reported results of operations for a period. Management uses these measures internally for evaluation of the performance of the business, including the allocation of resources and the evaluation of results relative to employee performance compensation targets.  Investors should consider these non-GAAP financial measures only as a supplement to, not as a substitute for or as superior to, measures of financial performance prepared in accordance with GAAP.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS 

This press release includes forward-looking statements under the Private Securities Litigation Reform Act of 1995.  These forward-looking statements generally can be identified by the use of words such as “anticipate,” “expect,” “could,” “may,” “will,” “believe,” “estimate,” “forecast,” “goal,” “project,” "continue," "outlook," “guidance,” "future,” other words of similar meaning and the use of future dates.  Forward-looking statements in this press release include, but are not limited to, statements about the company’s anticipated financial results for 2015, including pro forma net sales and pro forma adjusted EBITDA from continuing operations; anticipated cost synergies and dis-synergies, the timing thereof and level of risk of achievement; the company’s expectations regarding the sales growth of its legacy Wright U.S. foot and ankle business, legacy Tornier U.S. upper extremity business, and legacy Wright international business; the benefits of its recently completed merger with Tornier; and the company’s anticipated growth opportunities, path to profitability and adjusted EBITDA margin goal and ability to generate long-term value for shareholders.  Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Each forward-looking statement contained in this press release is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statement.  Applicable risks and uncertainties include, among others, the failure to integrate the businesses and realize synergies and cost-savings from the recently completed merger transaction or delay in realization thereof; operating costs and business disruption as a result of the transaction, including adverse effects on employee retention and sales force productivity and on business relationships with third parties; transaction and integration costs; actual or contingent liabilities; the adequacy of the company’s capital resources; the timing of regulatory approvals and introduction of new products; physician acceptance, endorsement, and use of new products; failure to achieve the anticipated benefits from approval of Augment® Bone Graft; the effect of regulatory actions, changes in and adoption of reimbursement rates; product liability claims and product recalls; pending and threatened litigation; risks associated with international operations and expansion; fluctuations in foreign currency exchange rates; other business effects, including the effects of industry, economic or political conditions outside of the company’s control; reliance on independent distributors and sales agencies; competitor activities; changes in tax and other legislation; and the risks identified under the heading “Risk Factors” in Wright Medical Group, Inc.’s Annual Report on Form 10-K, which was filed with the SEC on February 26, 2015, and Tornier’s Annual Report on Form 10-K, which was filed with the SEC on February 24, 2015, as well as both companies’ subsequent Quarterly Reports on Form 10-Q and other information filed by each company with the SEC and a Quarterly Report on Form 10-Q for the quarter ended September 27, 2015 to be filed by Wright with the SEC.  Investors should not place considerable reliance on the forward-looking statements contained in this press release.  You are encouraged to read Wright’s and Tornier’s filings with the SEC, available at www.sec.gov, for a discussion of these and other risks and uncertainties. The forward-looking statements in this press release speak only as of the date of this release, and Wright undertakes no obligation to update or revise any of these statements.  Wright’s business is subject to substantial risks and uncertainties, including those referenced above.  Investors, potential investors, and others should give careful consideration to these risks and uncertainties.

--Tables Follow--

 

 
Legacy Wright Medical Group, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data--unaudited)
 
  Three Months Ended   Nine Months Ended
    September 30, 2015       September 30, 2014       September 30, 2015       September 30, 2014  
Net sales $ 80,139     $ 71,307     $ 238,493     $ 214,733  
Cost of sales 23,052     16,703     63,812     54,126  
Gross profit 57,087     54,604     174,681     160,607  
Operating expenses:              
Selling, general and administrative 85,997     66,926     250,801     207,629  
Research and development 9,570     5,948     24,644     18,603  
Amortization of intangible assets 2,562     2,379     7,741     7,241  
Total operating expenses 98,129     75,253     283,186     233,473  
Operating loss (41,042 )   (20,649 )   (108,505 )   (72,866 )
Interest expense, net 11,185     4,565     29,793     12,873  
Other (income) expense, net 10,236     21,430     7,395     54,986  
Loss from continuing operations before income taxes (62,463 )   (46,644 )   (145,693 )   (140,725 )
Provision (benefit) for income taxes 187     3,003     511     (7,197 )
Net loss from continuing operations $ (62,650 )   $ (49,647 )   $ (146,204 )   $ (133,528 )
Loss from discontinued operations, net of tax (36,211 )   (12,160 )   (46,720 )   (14,925 )
Net loss $ (98,861 )   $ (61,807 )   $ (192,924 )   $ (148,453 )
               
Net loss from continuing operations per share, basic $ (1.22 )   $ (0.99 )   $ (2.86 )   $ (2.70 )
Net loss from continuing operations per share, diluted $ (1.22 )   $ (0.99 )   $ (2.86 )   $ (2.70 )
               
Net loss per share, basic $ (1.93 )   $ (1.24 )   $ (3.78 )   $ (3.00 )
Net loss per share, diluted $ (1.93 )   $ (1.24 )   $ (3.78 )   $ (3.00 )
               
Weighted-average number of shares outstanding-basic 51,172     50,043     51,033     49,441  
Weighted-average number of shares outstanding-diluted 51,172     50,043     51,033     49,441  



Legacy Wright Medical Group, Inc.
Consolidated Sales Analysis
(dollars in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 30,
2015
  September 30,
2014
  %
change
  September 30,
2015
  September 30,
2014
  %
change
U.S.                      
Foot and Ankle 43,929     35,560     23.5 %   128,277     102,599     25.0 %
Upper Extremity 3,654     4,016     (9.0 %)   11,703     11,420     2.5 %
Biologics 12,198     11,162     9.3 %   34,612     33,376     3.7 %
Other 613     559     9.7 %   1,558     2,196     (29.1 %)
Total U.S. $ 60,394     $ 51,297     17.7 %   $ 176,150     $ 149,591     17.8 %
                       
International                      
Foot and Ankle 10,917     10,068     8.4 %   35,313     35,882     (1.6 %)
Upper Extremity 1,764     2,351     (25.0 %)   5,723     8,875     (35.5 %)
Biologics 5,260     5,860     (10.2 %)   15,070     15,437     (2.4 %)
Other 1,804     1,731     4.2 %   6,237     4,948     26.1 %
Total International $ 19,745     $ 20,010     (1.3 %)   $ 62,343     $ 65,142     (4.3 %)
                       
Global                      
Foot and Ankle 54,846     45,628     20.2 %   163,590     138,481     18.1 %
Upper Extremity 5,418     6,367     (14.9 %)   17,426     20,295     (14.1 %)
Biologics 17,458     17,022     2.6 %   49,682     48,813     1.8 %
Other 2,417     2,290     5.5 %   7,795     7,144     9.1 %
Total Sales $ 80,139     $ 71,307     12.4 %   $ 238,493     $ 214,733     11.1 %


Legacy Wright Medical Group, Inc.
Supplemental Sales Information
(unaudited)
 
  Third Quarter 2015 Sales Growth/(Decline)
  Domestic
As
Reported
Int'l
Constant
Currency
Int'l
As
Reported
Total
Constant
Currency
Total
As
Reported
Product Line          
Foot and Ankle   24 %   23 %   8 %   23 %   20 %
Upper Extremity   (9 %)   (14 %)   (25 %)   (11 %)   (15 %)
Biologics   9 %   1 %   (10 %)   6 %   3 %
Other   10 %   20 %   4 %   18 %   6 %
Total Sales   18 %   12 %   (1 %)   16 %   12 %


Legacy Wright Medical Group, Inc.
Supplemental Sales Information
(unaudited)
 
  Nine Months Ended September 30, 2015 Sales Growth/(Decline)
  Domestic
As
Reported
Int'l
Constant
Currency
Int'l
As
Reported
Total
Constant
Currency
Total
As
Reported
Product Line          
Foot and Ankle   25 %   12 %   (2 %)   22 %   18 %
Upper Extremity   2 %   (26 %)   (36 %)   (10 %)   (14 %)
Biologics   4 %   8 %   (2 %)   5 %   2 %
Other   (29 %)   48 %   26 %   25 %   9 %
Total Sales   18 %   9 %   (4 %)   15 %   11 %


Legacy Wright Medical Group, Inc.
Reconciliation of Net Sales to Net Sales Excluding the Impact of Foreign Currency
(dollars in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 30, 2015   September 30, 2015
  International
Net Sales
  Total
Net Sales
  International
Net Sales
  Total
Net Sales
Net sales, as reported $ 19,745     $ 80,139     $ 62,343     $ 238,493  
Currency impact as compared to prior period 2,656     2,656     8,394     8,394  
Net sales, excluding the impact of foreign currency $ 22,401     $ 82,795     $ 70,737     $ 246,887  


Legacy Wright Medical Group, Inc.
Reconciliation of As Reported Results to Non-GAAP Financial Measures
(in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September
30,
2015
  September
30,
2014
  September
30,
2015
  September
30,
2014
Operating Loss              
Operating loss, as reported $ (41,042 )   $ (20,649 )   $ (108,505 )   $ (72,866 )
Reconciling items impacting Gross Profit:              
Inventory step-up amortization 20     302     69     1,521  
Transaction and transition costs 2,423         2,423      
Total 2,443     302     2,492     1,521  
Reconciling items impacting Selling, General and Administrative expense:              
Distributor conversions     16         172  
Due diligence, transaction and transition costs 17,464     2,740     40,617     16,030  
Patent dispute settlement     900         900  
Management changes (1)     1,203         1,203  
Total 17,464     4,859     40,617     18,305  
Reconciling items impacting Amortization of Intangible Assets:              
Amortization of distributor non-competes 16     462     65     1,526  
               
Operating loss, as adjusted $ (21,119 )   $ (15,026 )   $ (65,331 )   $ (51,514 )
Operating loss, as adjusted, as a percentage of net sales (26.4 )%   (21.1 )%   (27.4 )%   (24.0 )%
                               
(1) For the three and nine months ended September 30, 2014, amount includes $0.3 million of non-cash stock-based compensation expense related to the management changes.


Legacy Wright Medical Group, Inc.
Reconciliation of As Reported Results to Non-GAAP Financial Measures
(in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 30,
2015
  September 30,
2014
  September 30,
2015
  September 30,
2014
EBITDA              
Net loss from continuing operations, as reported $ (62,650 )   $ (49,647 )   $ (146,204 )   $ (133,528 )
Interest expense, net 11,185     4,565     29,793     12,873  
Provision (benefit) for income taxes 187     3,003     511     (7,197 )
Depreciation 6,268     4,654     16,966     13,494  
Amortization of intangible assets 2,562     2,379     7,741     7,241  
EBITDA (42,448 )   (35,046 )   (91,193 )   (107,117 )
Reconciling items impacting EBITDA              
Non-cash stock-based compensation expense (1) 2,025     2,586     7,706     8,685  
Other expense, net 10,236     21,430     7,395     54,986  
Inventory step-up amortization 20     302     69     1,521  
Distributor conversions     16         172  
Due diligence, transaction and transition costs 19,887     2,740     43,040     16,030  
Patent dispute settlement     900         900  
Management changes     1,203         1,203  
Adjusted EBITDA $ (10,280 )   $ (5,869 )   $ (32,983 )   $ (23,620 )
Adjusted EBITDA as a percentage of net sales (12.8 )%   (8.2 )%   (13.8 )%   (11.0 )%
 
(1) For the three and nine months ended September 30, 2014, amount excludes $0.3 million of non-cash stock-based compensation expense related to the management changes, which is included in management changes.


Legacy Wright Medical Group, Inc.
Reconciliation of As Reported Results to Non-GAAP Financial Measures
(in thousands, except per share data--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 30,
2015
  September 30,
2014
  September 30,
2015
  September 30,
2014
Net Income              
Loss before taxes, as reported $ (62,463 )   $ (46,644 )   $ (145,693 )   $ (140,725 )
Pre-tax impact of reconciling items:              
Inventory step-up amortization 20     302     69     1,521  
Distributor conversion and non-competes 16     478     65     1,698  
Non-cash interest expense on 2017 & 2020 Convertible Notes 6,767     2,333     17,857     6,886  
Write-off of unamortized debt discount and deferred financing fees (100 )       25,101      
Derivatives mark-to-market adjustment (4,652 )   1,000     (12,021 )   2,000  
Due diligence, transaction and transition costs 19,887     2,740     43,040     16,030  
Patent dispute settlement     900         900  
Management changes (1)     1,203         1,203  
CVR mark-to-market adjustments 14,569     18,499     (7,350 )   51,293  
Contingent consideration fair value adjustment     1,750     155     1,750  
Loss before taxes, as adjusted (25,956 )   (17,439 )   (78,777 )   (57,444 )
Provision (benefit) for income taxes, as reported $ 187     $ 3,003     $ 511     $ (7,197 )
U.S. tax impact resulting from gain in discontinued operations     (2,776 )       7,940  
Tax effect of reconciling items         27      
Provision (benefit) for income taxes, as adjusted $ 187     $ 227     $ 538     $ 743  
Effective tax rate, as adjusted (0.7 )%   (1.3 )%   (0.7 )%   (1.3 )%
Net loss from continuing operations, as adjusted $ (26,143 )   $ (17,666 )   $ (79,315 )   $ (58,187 )
               
Weighted-average number of shares outstanding-diluted 51,172     50,043     51,033     49,441  
Net loss from continuing operations, as adjusted, per diluted share $ (0.51 )   $ (0.35 )   $ (1.55 )   $ (1.18 )
 
(1) For the three and nine months ended September 30, 2014, amount includes $0.3 million of non-cash stock-based compensation expense related to the management changes.


Legacy Wright Medical Group, Inc.
Reconciliation of Free Cash Flow
(dollars in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 30,
2015
September 30,
2014
  September 30,
2015
September 30,
2014
Net cash used in operating activities $ (90,839 ) $ (34,562 )   $ (141,839 ) $ (86,152 )
Capital expenditures (8,259 ) (11,422 )   (34,013 ) (35,706 )
Free cash flow $ (99,098 ) $ (45,984 )   $ (175,852 ) $ (121,858 )


Legacy Wright Medical Group, Inc.
Segment Information
(in thousands--unaudited)
 
  Three Months Ended September 30, 2015
  U.S. International BioMimetic Corporate Other (1) Total
Sales $ 60,394   $ 19,745   $   $   $   $ 80,139  
Gross profit 46,874   12,673     (17 ) (2,443 ) 57,087  
Operating income (loss) 2,219   (2,627 ) (3,952 ) (16,759 ) (19,923 ) (41,042 )
Operating income (loss) as a percent of net sales 3.7 % (13.3 %) N/A   N/A   N/A   (51.2 %)
             
Depreciation Expense 3,500   827   46   1,895     6,268  
Amortization Expense 2,025   469   52     16   2,562  
Non-cash stock-based compensation expense       2,025     2,025  
Other         19,907   19,907  
Adjusted EBITDA 7,744   (1,331 ) (3,854 ) (12,839 )   (10,280 )
 
(1)  Other consists exclusively of the reconciling items from Operating Income, as reported, to Operating Income, as adjusted, as included in the reconciliations above.


  Three Months Ended September 30, 2014
  U.S. International BioMimetic Corporate Other (1) Total
Sales $ 51,297   $ 20,010   $   $   $   $ 71,307  
Gross profit 42,939   12,010     (43 ) (302 ) 54,604  
Operating income (loss) 6,448   (3,213 ) (2,601 ) (15,660 ) (5,623 ) (20,649 )
Operating income (loss) as a percent of net sales 12.6 % (16.1 %) N/A   N/A   N/A   (29.0 %)
             
Depreciation Expense 2,414   841   108   1,291     4,654  
Amortization Expense 1,293   547   77     462   2,379  
Non-cash stock-based compensation expense       2,586     2,586  
Other         5,161   5,161  
Adjusted EBITDA 10,155   (1,825 ) (2,416 ) (11,783 )   (5,869 )
 
(1)  Other consists exclusively of the reconciling items from Operating Income, as reported, to Operating Income, as adjusted, as included in the reconciliations above.


Legacy Wright Medical Group, Inc.
Segment Information
(in thousands--unaudited)
 
  Nine Months Ended September 30, 2015
  U.S. International BioMimetic Corporate Other (1) Total
Sales $ 176,150   $ 62,343   $   $   $   $ 238,493  
Gross profit 138,850   38,351     (28 ) (2,492 ) 174,681  
Operating income (loss) 8,021   (8,658 ) (11,051 ) (53,643 ) (43,174 ) (108,505 )
Operating income (loss) as a percent of net sales 4.6 % (13.9 %) N/A   N/A   N/A   (45.5 %)
             
Depreciation Expense 9,693   2,330   127   4,816     16,966  
Amortization Expense 6,132   1,402   142     65   7,741  
Non-cash stock-based compensation expense       7,706     7,706  
Other         43,109   43,109  
Adjusted EBITDA 23,846   (4,926 ) (10,782 ) (41,121 )   (32,983 )
 
(1)  Other consists exclusively of the reconciling items from Operating Income, as reported, to Operating Income, as adjusted, as included in the reconciliations above.


  Nine Months Ended September 30, 2014
  U.S. International BioMimetic Corporate Other (1) Total
Sales $ 149,591   $ 65,142   $   $   $   $ 214,733  
Gross profit 120,717   41,642     (231 ) (1,521 ) 160,607  
Operating income (loss) 12,914   (2,385 ) (9,385 ) (52,658 ) (21,352 ) (72,866 )
Operating income (loss) as a percent of net sales 8.6 % (3.7 %) N/A   N/A   N/A   (33.9 %)
             
Depreciation Expense 7,093   2,246   324   3,831     13,494  
Amortization Expense 3,820   1,663   231   1   1,526   7,241  
Non-cash stock-based compensation expense       8,685     8,685  
Other         19,826   19,826  
Adjusted EBITDA 23,827   1,524   (8,830 ) (40,141 )   (23,620 )
 
(1)  Other consists exclusively of the reconciling items from Operating Income, as reported, to Operating Income, as adjusted, as included in the reconciliations above.


Legacy Wright Medical Group, Inc.
Condensed Consolidated Balance Sheets
(dollars in thousands--unaudited)
 
  September 30,
2015
  December 31,
2014
Assets      
Current assets:      
Cash and cash equivalents $ 254,435     $ 227,326  
Marketable securities     2,575  
Accounts receivable, net 51,713     57,190  
Inventories 111,064     88,412  
Prepaid expenses and other current assets 44,663     64,953  
Total current assets 461,875     440,456  
       
Property, plant and equipment, net 122,450     104,235  
Goodwill and intangible assets, net 258,876     259,991  
Other assets 122,334     87,994  
Total assets $ 965,535     $ 892,676  
       
Liabilities and stockholders' equity      
Current liabilities:      
Accounts payable $ 18,261     $ 16,729  
Accrued expenses and other current liabilities 79,345     170,204  
Current portion of long-term obligations 784     718  
Total current liabilities 98,390     187,651  
Long-term obligations 565,556     280,612  
Other liabilities 187,618     145,610  
Total liabilities 851,564     613,873  
       
Stockholders' equity 113,971     278,803  
Total liabilities and stockholders' equity $ 965,535     $ 892,676  


Legacy Tornier N.V.
Consolidated Statements of Operations
(in thousands, except per share data--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 27,
2015
  September 28,
2014
  September 27,
2015
  September 28,
2014
Revenue $ 74,944     $ 76,675     $ 246,257     $ 252,550  
Cost of goods sold 16,427     17,853     55,100     61,124  
Cost of goods sold - acquisition related     157         577  
Gross profit 58,517     58,665     191,157     190,849  
  78.1 %   76.5 %   77.6 %   75.6 %
Operating expenses:              
Selling, general and administrative 55,416     57,127     174,622     178,479  
Research and development 4,972     6,055     16,783     17,845  
Amortization of intangible assets 4,004     4,274     12,051     12,928  
Special charges 2,657     (4,366 )   6,860     (994 )
Total operating expenses 67,049     63,090     210,316     208,258  
Operating (loss) income (8,532 )   (4,425 )   (19,159 )   (17,409 )
Other (income) expense              
Interest income 64     18     82     126  
Interest expense (1,419 )   (1,250 )   (4,171 )   (3,964 )
Foreign currency transaction loss (315 )   (152 )   (410 )   (195 )
Other non-operating income 60     11     148     20  
Loss before income taxes (10,142 )   (5,798 )   (23,510 )   (21,422 )
Income tax expense (652 )   477     (1,743 )   416  
Consolidated net loss $ (10,794 )   $ (5,321 )   $ (25,253 )   $ (21,006 )
Net loss per share              
Basic and diluted $ (0.22 )   $ (0.11 )   $ (0.51 )   $ (0.43 )
Weighted average ordinary shares outstanding              
Basic and diluted 49,279     48,832     49,116     48,656  


Legacy Tornier N.V.
Selected Revenue Information
(dollars in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 27,
2015
  September 28,
2014
  %
change
  September 27,
2015
  September 28,
2014
  %
change
Revenue by product category                      
Upper extremity joints and trauma $ 52,582     $ 48,963     7.4 %   $ 166,542     $ 155,845     6.9 %
Lower extremity joints and trauma 10,851     13,814     (21.4 %)   36,756     43,356     (15.2 %)
Sports medicine and biologics 2,680     3,009     (10.9 %)   9,406     10,549     (10.8 %)
Total extremities 66,113     65,786     0.5 %   212,704     209,750     1.4 %
Large joints and other 8,831     10,889     (18.9 %)   33,553     42,800     (21.6 %)
Total $ 74,944     $ 76,675     (2.3 %)   $ 246,257     $ 252,550     (2.5 %)
                       
Revenue by geography                      
United States $ 48,838     $ 46,752     4.5 %   $ 151,912     $ 145,565     4.4 %
International 26,106     29,923     (12.8 %)   94,345     106,985     (11.8 %)
Total $ 74,944     $ 76,675     (2.3 %)   $ 246,257     $ 252,550     (2.5 %)


Legacy Tornier N.V.
Reconciliation of Revenue to Non-GAAP Revenue on a Constant Currency Basis
(dollars in thousands--unaudited)
 
  Three Months Ended    
  September 27, 2015   September 28,
2014
     
  Revenue as
reported
  Foreign
exchange
impact as
compared to
prior period
  Revenue on a
constant
currency basis
  Revenue as
reported
  Percent
change on
a constant
currency
basis
Revenue by product category                  
Upper extremity joints and trauma 52,582     2,611     55,193     48,963     12.7 %
Lower extremity joints and trauma 10,851     432     11,283     13,814     (18.3 )%
Sports medicine and biologics 2,680     199     2,879     3,009     (4.3 )%
Total extremities 66,113     3,242     69,355     65,786     5.4 %
Large joints and other 8,831     1,433     10,264     10,889     (5.7 )%
Total 74,944     4,675     79,619     76,675     3.8 %
                   
Revenue by geography                  
United States 48,838         48,838     46,752     4.5 %
International 26,106     4,675     30,781     29,923     2.9 %
Total 74,944     4,675     79,619     76,675     3.8 %


  Nine Months Ended    
  September 27, 2015   September 28,
2014
  Percent
change on
a constant
currency
basis
  Revenue as
reported
  Foreign
exchange
impact as
compared to
prior period
  Revenue on a
constant
currency basis
  Revenue as
reported
 
Revenue by product category                  
Upper extremity joints and trauma 166,542     9,412     175,954     155,845     12.9 %
Lower extremity joints and trauma 36,756     1,366     38,122     43,356     (12.1 )%
Sports medicine and biologics 9,406     756     10,162     10,549     (3.7 )%
Total extremities 212,704     11,534     224,238     209,750     6.9 %
Large joints and other 33,553     6,706     40,259     42,800     (5.9 )%
Total 246,257     18,240     264,497     252,550     4.7 %
                   
Revenue by geography                  
United States 151,912         151,912     145,565     4.4 %
International 94,345     18,240     112,585     106,985     5.2 %
Total 246,257     18,240     264,497     252,550     4.7 %


Legacy Tornier N.V.
Reconciliation of Net Loss to Non-GAAP Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
(in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 27,
2015
  September 28,
2014
  September 27,
2015
  September 28,
2014
Revenue, as reported $ 74,944     $ 76,675     $ 246,257     $ 252,550  
Net loss, as reported $ (10,794 )   $ (5,321 )   $ (25,253 )   $ (21,006 )
Interest income (64 )   (18 )   (82 )   (126 )
Interest expense 1,419     1,250     4,171     3,964  
Income tax expense (benefit) 652     (477 )   1,743     (416 )
Depreciation 6,113     6,058     18,498     17,666  
Amortization 4,004     4,274     12,051     12,928  
Subtotal Non-GAAP EBITDA 1,330     5,766     11,128     13,010  
Other non-operating (income) expense (60 )   (11 )   (148 )   (20 )
Foreign currency transaction loss (gain) 315     152     410     195  
Share-based compensation 1,854     2,348     6,512     6,869  
Inventory step-up from acquisition     157         577  
Special Charges:              
Acquisition, integration and distribution transition costs (127 )   214     691     2,250  
Reversal of OrthoHelix contingent consideration liability     (5,000 )       (5,000 )
Instrument use tax refund         (2,000 )    
Restructuring     420         1,431  
Proposed merger-related costs 2,784         8,169      
Other             325  
Non-GAAP adjusted EBITDA $ 6,096     $ 4,046     $ 24,762     $ 19,637  
Non-GAAP adjusted EBITDA margin 8.1 %   5.3 %   10.1 %   7.8 %


Legacy Tornier N.V.
Reconciliation of Net Loss and Loss per Share to Adjusted Net Loss and Adjusted Net Loss per Share
(in thousands, except per share data--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 27,
2015
  September 28,
2014
  September 27,
2015
  September 28,
2014
Net loss, as reported $ (10,794 )   $ (5,321 )   $ (25,253 )   $ (21,006 )
Inventory step-up from acquisition, net of tax     (119 )         284  
Reversal of valuation allowance from acquisition               (146 )
Special charges, net of tax:              
Acquisition, integration and distribution transition costs (106 )   200     691       2,236  
Reversal of OrthoHelix contingent consideration liability     (5,000 )         (5,000 )
Instrument use tax refund         (2,000 )        
Restructuring     420           1,431  
Proposed merger-related costs 2,772         8,157          
Other               325  
Non-GAAP adjusted net loss (8,128 )   (9,820 )   (18,405 )     (21,876 )
Net loss per share, as reported              
Basic and diluted $ (0.22 )   $ (0.11 )   $ (0.51 )   $ (0.43 )
Inventory step-up from acquisition, net of tax               0.01  
Reversal of valuation allowance from acquisition               (0.01
Special charges, net of tax:              
Acquisition, integration and distribution transition costs     0.01     0.01       0.05  
Reversal of OrthoHelix contingent consideration liability     (0.11 )         (0.11 )
Instrument use tax refund         (0.04 )    
Restructuring     0.01           0.03  
Proposed merger-related costs 0.06         0.17      
Other               0.01  
Non-GAAP adjusted net loss per share              
Basic and diluted (0.16 )   (0.20 )   (0.37 )     (0.45 )
Weighted average ordinary shares outstanding              
Basic and diluted 49,279     48,832     49,116       48,656  


Legacy Tornier N.V.
Reconciliation of Net Cash Provided by Operating Activities to Non-GAAP Free Cash Flow
(dollars in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 27,
2015
  September 28,
2014
  September 27,
2015
  September 28,
2014
Net cash provided by operating activities, as reported $ 11,299     $ (4,622 )   $ 12,907     $ (4,517 )
Adjusted for:              
Additions of instruments, as reported (4,808 )   (4,214 )   (14,089 )   (18,749 )
Purchases of property, plant and equipment, as reported (883 )   (3,248 )   (4,544 )   (8,128 )
Non-GAAP adjusted free cash flow $ 5,608     $ (12,084 )   $ (5,726 )   $ (31,394 )


Legacy Tornier N.V.
Reconciliation of Gross Margin and Gross Margin % to Non-GAAP Adjusted Gross Margin and Gross Margin %
(dollars in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 27,
2015
  September 28,
2014
  September 27,
2015
  September 28,
2014
Revenue, as reported $ 74,944     $ 76,675     $ 246,257     $ 252,550  
Gross margin, as reported $ 58,517     $ 58,665     $ 191,157     $ 190,849  
Gross margin %, as reported 78.1 %   76.5 %   77.6 %   75.6 %
Adjusted for:              
Inventory step-up due to acquisition     157         577  
Non-GAAP adjusted gross margins 58,517     58,822     191,157     191,426  
Non-GAAP adjusted gross margin % 78.1 %   76.7 %   77.6 %   75.8 %


Legacy Tornier N.V.
Reconciliation of Operating Expenses to Non-GAAP Adjusted Operating Expenses
(dollars in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 27,
2015
  September 28,
2014
  September 27,
2015
  September 28,
2014
Revenue, as reported $ 74,944     $ 76,675     $ 246,257     $ 252,550  
Operating Expenses, as reported 67,049     63,090     210,316     208,258  
Operating expenses as a percentage of revenue, as reported 89.5 %   82.3 %   85.4 %   82.5 %
Adjusted for:              
Amortization of intangible assets (4,004 )   (4,274 )   (12,051 )   (12,928 )
Special charges (2,657 )   4,366     (6,860 )   994  
Total adjustments (6,661 )   92     (18,911 )   (11,934 )
Non-GAAP adjusted operating expenses $ 60,388     $ 63,182     $ 191,405     $ 196,324  
Non-GAAP adjusted operating expenses as a percentage of revenue 80.6 %   82.4 %   77.7 %   77.7 %


Legacy Tornier N.V.
Condensed Consolidated Balance Sheets
(dollars in thousands--unaudited)
 
  September 27,
2015
  December 28,
2014
Assets      
Current assets:      
Cash and cash equivalents $ 30,111     $ 27,940  
Accounts receivable, net 62,303     63,583  
Inventories 83,668     88,662  
Deferred income taxes and other current assets 26,902     29,516  
Total current assets 202,984     209,701  
Instruments, net 59,728     62,888  
Property, plant and equipment, net 42,632     44,662  
Goodwill and intangible assets, net 318,115     339,902  
Deferred income taxes and other assets 1,819     1,422  
Total assets $ 625,278     $ 658,575  
Liabilities and stockholders' equity      
Current liabilities:      
Short-term borrowing and current portion of long-term debt $ 8,354     $ 7,394  
Accounts payable 15,306     15,073  
Accrued liabilities, deferred income taxes and other current liabilities 59,046     61,994  
Total current liabilities 82,706     84,461  
Other long-term debt 77,774     68,105  
Deferred income taxes and other long-term liabilities 25,571     27,119  
Total liabilities 186,051     179,685  
Stockholders' equity 439,227     478,890  
Total liabilities and stockholders' equity $ 625,278     $ 658,575  


Legacy Tornier N.V.
Consolidated Statements of Cash Flow
(dollars in thousands--unaudited)
 
  Three Months Ended   Nine Months Ended
  September 27,
2015
  September 28,
2014
  September 27,
2015
  September 28,
2014
Cash flows from operating activities              
Consolidated net loss $ (10,794 )   $ (5,321 )   $ (25,253 )   $ (21,006 )
Adjustments to reconcile consolidated net loss to net cash provided by (used in) operating activities              
Depreciation and amortization 10,117     10,332     30,549     30,594  
Non-cash foreign currency loss 325     137     387     176  
Deferred income taxes 64     (2,673 )   (2,812 )   (5,254 )
Share-based compensation 1,854     2,348     6,512     6,869  
Non-cash interest expense and discount amortization 297     211     733     565  
Inventory obsolescence 3,555     2,711     8,568     8,389  
Fair value adjustment of contingent consideration liability (151 )   (5,327 )   618     (5,327 )
Inventory step up from acquisition     157         577  
Other non-cash items affecting earnings 159     (14 )   410     312  
               
Changes in operating assets and liabilities              
Accounts receivable 5,439     2,204     (774 )   (1,015 )
Inventories (2,823 )   (6,260 )   (9,316 )   (21,586 )
Accounts payable and accruals (655 )   (3,954 )   2,973     4,213  
Other current assets and liabilities 3,494     634     29     (2,713 )
Other non-current assets and liabilities 418     193     283     689  
Net cash provided by (used in) operating activities 11,299     (4,622 )   12,907     (4,517 )
Cash flows from investing activities              
Acquisition-related cash payments     (20 )   (360 )   (2,020 )
Additions of instruments (4,808 )   (4,214 )   (14,089 )   (18,749 )
Purchases of property, plant and equipment (883 )   (3,248 )   (4,544 )   (8,128 )
Net cash used in investing activities (5,691 )   (7,482 )   (18,993 )   (28,897 )
Cash flows from financing activities              
Contingent consideration payments (1,155 )   (1,171 )   (2,607 )   (6,793 )
Change in short-term debt     6,000     1,000     6,000  
Repayments of long-term debt (277 )   (160 )   (1,047 )   (723 )
Proceeds from issuance of long-term debt         10,067     477  
Deferred financing costs         (114 )    
Issuance of ordinary shares 235     932     1,958     3,128  
Net cash (used in) provided by financing activities (1,197 )   5,601     9,257     2,089  
Effect of currency exchange rates on cash and cash equivalents (183 )   662     (1,000 )   471  
Decrease in cash and cash equivalents 4,228     (5,841 )   2,171     (30,854 )
Cash and cash equivalents at beginning of period 25,883     31,771     27,940     56,784  
Cash and cash equivalents at end of period $ 30,111     $ 25,930     $ 30,111     $ 25,930  


Wright Medical Group N.V.
Reconciliation of Estimated 2015 Net Sales to Estimated 2015 Pro Forma Net Sales
(dollars in millions--unaudited)
 
  Twelve Months Ended
  December 27, 2015
  Low-End of
Range
  High-End of
Range
Legacy Wright Medical Group year-to-date net sales $ 238.5     $ 238.5  
Estimated Wright Medical Group N.V. fourth quarter net sales 161.0     167.0  
Estimated 2015 Net Sales $ 399.5     $ 405.5  
Legacy Tornier N.V. year-to-date net sales 246.2     246.2  
Legacy Tornier N.V. sales of divested foot & ankle products   (9.7 )     (9.7 )
Estimated 2015 Pro Forma Net Sales $ 636     $ 642  


Investors & Media:

Wright Medical Group N.V.
Julie D. Tracy
Chief Communications Officer
(901) 290-5817 (office)
julie.tracy@wmt.com

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Wright Medical Group N.V.