0001420800-26-000020
SEC filingSegment revenue declined in P&R but grew in Recon; Adjusted EBITDA improved; $100M buyback authorization remains unused.
As of April 3, 2026, Enovis had total debt of $1.326B, up from $1.297B at year-end 2025, driven by revolver borrowings partially offset by term loan repayments. The credit agreement provides $1.1B revolver capacity, with $906M available. Inventory stood at $602.5M, reflecting a $18.2M increase from December 2025, primarily in finished goods. No cash or equity figures are disclosed in the notes; these are found in the primary financial statements.
The notes disclose no significant purchase commitments or contractual obligations beyond routine legal proceedings and restructuring liabilities. The restructuring liability of $5.8M (down from $8.0M) consists of termination benefits. The company has a $56.5M royalty interest buyout payable over nine years, with $4.2M current and $31.6M non-current. Contingent consideration liabilities of $16.1M relate to acquisitions, with a maximum fixed payout of $3.3M on some arrangements.
No share repurchases occurred in Q1 2026; a $100M authorization remains unused. No dividends were paid. Debt increased net $29.2M as the company borrowed $72.0M on the revolver and repaid $35.5M, plus $8.8M on the term loan. Capital expenditures totaled $52.8M, or 9.0% of sales, heavily weighted to the Reconstructive segment ($45.6M vs. $7.2M in P&R). This capex level exceeds depreciation of $30.8M (excluding amortization).
Enovis operates two segments. Prevention & Recovery (P&R) generated $272.0M in Q1 2026 revenue, flat versus prior year (-0.2%), with weakness in U.S. Other P&R (-16.1%) offset by International P&R growth (+11.4%). Reconstructive (Recon) revenue grew 10.8% to $317.1M, driven by both U.S. (+8.2%) and International (+13.2%). Segment Adjusted EBITDA improved: P&R from $30.9M to $31.1M (+0.7%), Recon from $56.1M to $72.5M (+29.1%). The segment notes provide granular cost breakdowns: segment cost of sales, R&D, and operating expenses, which are not available in MD&A. The geographic mix within each segment is detailed in Note 4, showing P&R's dependence on U.S. Bracing & Support (42% of segment) and Recon's balanced 47/53 split between U.S. and International.
Operating cash flow (CFO) of $24.0M marked a significant turnaround from a $1.6M use in the prior year quarter, driven by a smaller net loss ($8.5M vs $55.7M) and favorable working capital changes, particularly a $26.9M increase in accounts payable. However, capex rose to $52.8M, resulting in negative free cash flow of ($28.9M). The company relied on net borrowings ($36.5M net from revolving credit) to fund capex and other investing activities. Working capital swings included a $22.1M inventory build and a $4.3M increase in receivables, partly offset by the payables increase. Deferred tax benefit of $37.7M also aided CFO. Overall, cash generation remains weak, with capital spending outpacing operating cash flow.