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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended March 31, 2002
Commission file number 0-20165
STERIS CORPORATION
(Exact name of
registrant as specified in its charter)
| Ohio |
|
34-1482024 |
| (State or other jurisdiction of incorporation or organization) |
|
(IRS Employer Identification
No.) |
| 5960 Heisley Road Mentor, Ohio
44060-1834 |
|
440-354-2600 |
| (Address of principal executive
offices) |
|
(Registrant’s telephone number including area code) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class
|
|
Name of Exchange on Which Registered
|
| Common Shares, without par value |
|
New York Stock Exchange |
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the
Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x
The aggregate market value of the voting stock held by non-affiliates of the Registrant, computed by reference to the closing price of
such stock as of May 31, 2002: $1,468,626,940
The number of Common Shares outstanding as of May 31, 2002:
69,724,904
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Proxy Statement for the 2002 Annual Meeting—Part III
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PART I |
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PART II |
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| Item 5 |
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| Item 7 |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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| Item 7a |
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| Item 8 |
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| Item 9 |
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PART III |
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| Item 10 |
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51 |
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| Item 11 |
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51 |
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| Item 12 |
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51 |
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| Item 13 |
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51 |
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PART IV |
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| Item 14 |
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52 |
PART I
Item 1. Business
STERIS Corporation, an Ohio corporation organized in 1987 (the
“Company” or “STERIS”), develops, manufactures, and markets infection prevention, contamination prevention, microbial reduction, and medical, surgical and therapy support systems, products, services, and technologies for
healthcare, scientific, research, and industrial customers throughout the world. STERIS is focused on helping customers address today’s trends in the healthcare and scientific industries. The healthcare industry is changing rapidly due to the
growth of minimally invasive surgical and diagnostic procedures; heightened public and professional awareness and concern for the increasing number of transmittable and antibiotic-resistant infectious diseases; the shifting of patient care from
acute care hospital settings to alternate sites; and the overall need to reduce the cost of healthcare delivery. These trends have expanded the demand for rapid, safe, and efficient infection prevention systems for critical tasks such as the sterile
processing of devices and the handling, decontamination, destruction, and disposal of potentially infectious biohazardous waste. The scientific industry is also expanding, as pharmaceutical, biotech, medical device, and other manufacturers are under
increasing pressure to adhere to stricter guidelines for the validation and control of their antimicrobial processes, as well as the trend towards global standardization of protocols.
As of March 31, 2002, the Company had 4,496 employees worldwide, with approximately 1,700 involved in direct sales, service, and field support. Customer support and
training facilities are located in major global market centers, and production and manufacturing operations are found in the United States, Australia, Canada, Germany, Finland, and Sweden.
The Company operates in a single business segment. See the accompanying consolidated financial statements beginning on page 27 of this Form 10-K for financial information
regarding the Company.
Principal Products and Services
Through a consistent strategic plan, a focused research
and development effort, and several business acquisitions, STERIS has established positions in low temperature sterilization, high temperature sterilization, washing and decontamination systems, surgical tables, surgical lights, and related
consumables and service. The Company has expanded from its original narrow product line to become a multi-faceted global organization that serves healthcare, scientific, research, and industrial customers. Revenues by principal customer group are as
follows (in thousands):
| |
|
Years Ended March 31,
|
| |
|
2002
|
|
2001
|
|
2000
|
| Healthcare |
|
$ |
607,638 |
|
$ |
566,567 |
|
$ |
557,686 |
| Scientific and Industrial |
|
|
259,059 |
|
|
233,520 |
|
|
202,940 |
| |
|
|
|
|
|
|
|
|
|
| Total Net Revenues |
|
$ |
866,697 |
|
$ |
800,087 |
|
$ |
760,626 |
| |
|
|
|
|
|
|
|
|
|
Healthcare. Healthcare systems,
products, and services are used by customers to significantly reduce or eliminate microbial contamination of surfaces with which human contact might occur. The Company provides complete infection prevention material processing systems and specialty
chemical products, including those used for cleaning, decontaminating, disinfecting, sterilizing, drying, and aerating medical and surgical instruments, devices, and hard surfaces. Specialty chemical products are generally employed in material
processing systems or used for high risk and routine skin care, hard surface disinfection, and surgical preparation. STERIS systems support cost containment, productivity increases, and risk reduction in a wide variety of healthcare settings through
process standardization, automatic monitoring and documentation, processing site flexibility, and reduction in processing time.
1
STERIS’s technology is used to rapidly destroy microorganisms on surfaces,
with a focus on sterile processing, biohazardous waste processing, and other surface safety applications in the healthcare industry. The technology also has applications in a wide variety of other settings where cleanliness and destruction of
microorganisms is important.
STERIS has been recognized for years as a leading provider of large and medium
scale, high quality hardware systems and related service, in the areas of infection prevention and surgical support. One of the Company’s well known products is the STERIS SYSTEM 1®
Low Temperature Liquid Sterile Processing System, used for just-in-time sterile processing at or near the site of patient care. SYSTEM 1 sterile processors enable healthcare professionals to economically sterilize immersible surgical and diagnostic
devices between patient procedures in less than thirty minutes. The use of SYSTEM 1 sterile processors also eliminates time-consuming transportation to and from central processing sites. Customers are able to use delicate, expensive, heat-sensitive
devices and instrument sets many times per day without compromising sterilization standards.
The Company’s
thermal sterilization systems use saturated steam to sterilize items through a combination of heat, moisture, and pressure. Thermal sterilizers are offered in a number of sizes based on customer throughput requirements, and are designed for use in
centralized and decentralized processing environments. The product line includes a versatile microprocessor-based control system designed to monitor each phase of the sterilization cycle and provide the customer a permanent record of important cycle
information, including type and parameters of sterilization cycle, temperature, pressure, vacuum, and total cycle time. The Company’s sterilizer chambers are made of highly durable nickel-clad carbon steel or 316L stainless steel.
In addition to thermal sterilization systems, the Company manufactures low temperature ethylene oxide (EO) gas sterilizers,
which provide customers the ability to sterilize heat sensitive medical devices in a controlled processing environment. Each sterilization system includes an advanced microprocessor-based control system, which monitors cycle parameters and provides
the customer a permanent record of each sterilization cycle. The Company’s most popular EO gas sterilization system, the Amsco® Eagle®
3017 100% EO Sterilizer, utilizes a proprietary, single-use sterilant cartridge and includes a built-in exhaust system.
A variety of Amsco® Reliance® automated washer/disinfector systems are also manufactured by STERIS for
Healthcare customers. These systems clean, thermally disinfect, and dry everything from rolling instrument carts and other large healthcare equipment to the smallest surgical instruments. The latest system in the line is the compact Reliance 333
Washer/Disinfector, which is the ideal solution for smaller outpatient surgery centers and same-day surgery centers that are more prevalent today.
STERIS develops, manufactures, and distributes infection prevention consumables and supplies that are used to prevent the spread of infectious diseases and to monitor sterilization and decontamination
processes. STERIS consumable products offer quality choices for infection and contamination prevention, including products used in instrument cleaning and decontamination systems, high risk and routine skin care products, hard surface disinfectants,
and surgical scrubs. STERIS quality assurance products to monitor sterilization processes include over 300 sterility assurance and sterility maintenance products for the worldwide healthcare market, including biological monitoring systems, barrier
wraps, integrator/indicator monitoring systems, and record-keeping systems.
The Company’s Healthcare product
line also includes general and specialty surgical tables, surgical and examination lights, operating room storage cabinets, fluid waste management systems, warming cabinets, scrub sinks, and other complementary products and accessories for hospitals
and other healthcare facilities. The Company’s versatile surgical table product line includes powered and manual general surgical tables, as well as specialty tables for orthopedics and image guided surgical procedures. A wide variety of
general and specialty surgical procedures are accommodated through the use of attachable accessories, which increase the versatility of the tables. The Company produces and sells a line of accessories and also sells accessories manufactured by
outside sources.
2
The Company’s illumination and space management systems are designed for a
wide variety of locations where diagnostic and therapeutic procedures are performed, including the emergency room, general surgery suite, OB/GYN suite, ICU/CCU suite, and ambulatory surgery suite. The lighting products combine optical performance
with positioning flexibility that accommodate the surface and cavity illumination needs of virtually all types of surgical procedures. The Company’s SurgiVision® Surgical Lighting and Video System
combines high quality illumination with a technically advanced video system to provide innovative and cost-effective systems for both acute care and non-acute care customers. The Company’s products range from major surgical lights to small
examination lights, and include the Orbiter® line of ceiling management products for hospital operating room, emergency and critical care, and ambulatory surgery markets.
STERIS is providing sterilization management and outsourcing services for healthcare facilities and is developing comprehensive
solutions to meet the instrument reprocessing needs of hospitals and healthcare facilities, to capitalize on the current hospital trend of outsourcing non-revenue generating operations such as central sterile processing.
Scientific and Industrial. Scientific & Industrial offerings include contamination prevention and
control systems, products, and services for pharmaceutical, biotechnology, medical device, critical research, laboratory research, and industrial customers throughout the world. These products and services assist customers in following the stringent
sterility assurance and microbial reduction processes demanded by the United States Food and Drug Administration (“FDA”), as well as worldwide regulatory and compliance agencies.
The Scientific offering is a complete range of systems and products with several of the most trusted brand names in the scientific industry: Finn-Aqua® and Amsco sterilizers, Reliance® and Basil® washers, Detach™
automated cage and bedding processing systems, VHP® (Vaporized Hydrogen Peroxide) biodecontamination systems, Finn-Aqua high-purity water systems, and Lyovac® freeze dryers, research and pharmaceutical washing systems, as well as an extensive line of consumable products for contamination prevention, surface cleaning, and sterility assurance.
STERIS also provides contract sterilization and microbial reduction services to manufacturers of pre-packaged healthcare and consumer
products. As a result of acquisitions—beginning with STERIS’s 1998 purchase of Isomedix Inc., a North American provider of contract sterilization and microbial reduction services—and internal expansion, STERIS now has a network of 16
contract sterilization facilities that utilize ethylene oxide, electron beam, and other processing technologies. STERIS’s contract sterilization subsidiaries work closely with customers to provide high-quality processing and optimum logistical
support to minimize the time it takes to move a product from the factory to its final destination.
STERIS field
service personnel are available worldwide to install, maintain, upgrade, and troubleshoot equipment. Additionally, STERIS offers services such as facility planning, engineering support, device testing, process and cleaner evaluation, education, and
preventative maintenance and repair services.
In both the Healthcare and Scientific & Industrial Customer
Groups, the products and services of STERIS and its subsidiaries are sold under a variety of brand and product names. As acquired businesses have been integrated and consolidated, the STERIS name is increasingly visible on the product and service
offerings.
The Company, as of March 31, 2002, manufactures, assembles, and packages
products in Erie, Pennsylvania; Mentor, Ohio; Montgomery, Alabama; Wadsworth, Ohio; St. Louis, Missouri; Cologne, Germany; Helsinki, Finland; Quebec City, Canada; Stockholm, Sweden; and Sydney, Australia. Each of the production facilities focuses on
particular processes and products. The majority of the Company’s equipment manufacturing facilities throughout the world are ISO 9001 certified. These facilities supply products to both Healthcare and Scientific and Industrial customers.
3
Raw materials, sub-assemblies, and other components essential to the
Company’s business are readily available within the lead times specified to vendors. The supply of such raw materials has posed no significant problem in the operation of the Company’s business. For core product lines, all major raw
materials are available from multiple sources, both domestic and foreign.
The Company’s international operations are subject to
various risks that are more likely to affect those operations than the Company’s domestic operations. These include, among other things, exchange controls and currency restrictions, currency fluctuations, changes in local economic conditions,
unsettled political conditions, and foreign government-sponsored boycotts of the Company’s products or services for noncommercial reasons. Most of the identifiable assets associated with the Company’s international operations are located
in countries where the Company believes such risks to be minimal. For certain financial information regarding the Company’s international operations, see Note 11—Business Segment Information to the accompanying consolidated financial
statements on page 46 of this Form 10-K.
Customers and Methods of Distribution
As of March 31, 2002, STERIS employs over 1,000
direct field sales and service representatives in North America. The representatives reside in metropolitan market areas throughout the United States and Canada. Sales and service activities are supported by a staff of regionally based clinical
specialists, systems planners, corporate account managers, and in-house customer service and field support departments.
The Company has adopted a strategy focused on employing direct sales, service, and support personnel in developed international markets while contracting with distributors in other selected markets. STERIS currently has sales offices
in Belgium, Canada, Costa Rica, Finland, France, Germany, Italy, Japan, Korea, Puerto Rico, Singapore, Spain, Sweden, and the United States. STERIS has distribution agreements with medical supply distributors in Australia, and various countries in
North and South America, Asia, and Europe.
Customer training is an important aspect of the STERIS business. In
addition to training at customer locations, STERIS provides a variety of courses for customers at the Company’s training and education centers and over the internet. The programs enable customer representatives to understand the science,
technology, and operation of STERIS products. Many of the Operator Training Programs are approved by professional certifying organizations for continuing education credits to eligible course participants.
The Company believes that one of its strengths is its broad customer base with no single customer accounting for more than one and one
half percent of revenue during the fiscal year ended March 31, 2002. Customers who are part of a buying group generally make independent purchasing decisions and are invoiced directly by the Company.
A number of methodologies and commercial products are available for general
sterilization purposes. Getinge/Castle, Advanced Sterilization Products (Johnson & Johnson), and 3M Corporation are well-known companies offering products for general sterilization and disinfection. Skytron (division of KMW Group, Inc.) and
Getinge/Castle are competitors in providing general surgical tables. Berchtold Corporation, Getinge/Castle, Heraeus Surgical, Inc., Hill-Rom, and Skytron are competitors in major surgery operating room light products. Competitors in sterility
assurance products include Kimberly-Clark Corporation and 3M Health Care. Competitors in environmental and instrument decontamination products include Getinge/Castle, Ecolab Inc., and Allegiance. The Company’s high risk and routine skin care
products compete against the products of Ecolab, Inc., Provon (Gojo), and SaniFresh (Kimberly-Clark). Allegiance, Becton Dickinson, Ecolab, Inc. and Purdue Frederick are competitors in providing surgical scrubs. Competitors in the original equipment
manufacturing service business include local and in-hospital service groups. In contract sterilization, the Company primarily
4
competes with Griffith Micro Science and SteriGenics International, Inc. (business units of Ion Beam Applications), and companies that sterilize products in-house. The primary competitor for the
Company’s Scientific and Industrial sterilization systems is Getinge/Castle.
In 1998, the FDA established
501(k) submission exemptions for many Class I devices, including certain surgical support products, which lessened the regulatory requirements for the introduction of these products. The lower regulatory barriers could accelerate new product
introductions for the Company and its domestic competitors, as well as improve the ability of foreign competitors to introduce products into the United States market and, as a result, increase competition.
Competition for the products provided by the Company is based upon product design and quality, product innovation, price, and product
serviceability that result in the greatest overall value to the customer. In addition, there is significant price competition among various instrument preparation processes and services provided by STERIS and its competitors.
STERIS anticipates that it may face increased competition in the future as new infection prevention, sterile processing,
contamination control, and surgical support products and services enter the market. Several smaller, early-stage companies are likely to be working with a variety of technologies and sterilizing agents, including microwave, ozone, plasma, chlorine
dioxide, peracids, and formaldehyde. In addition, a number of companies have developed disposable medical instruments and other devices designed to address the risk of contamination. There can be no assurance that new products or services developed
by the Company’s competitors will not be more commercially successful than those currently being developed by STERIS or that may be developed by STERIS in the future. In addition, some of STERIS’s existing or potential competitors may have
greater financial, technical, and human resources than the Company. Accordingly, the Company’s competitors may succeed in developing and commercializing products more rapidly than the Company.
Many of the Company’s products and manufacturing processes
are subject to regulation by the FDA, the United States Environmental Protection Agency (“EPA”), the United States Nuclear Regulatory Commission, and other governmental authorities. Similar regulatory agencies exist in other countries with
a wide variety of regulatory review processes and procedures. Many products offered for sale in Europe must meet the CE marking requirements, and must be manufactured in accordance with the Medical Devices Directive, ISO 9001, and EN 46001 Quality
System Standards. The Company’s products are also subject to review or certification by various nongovernmental certification authorities, such as Underwriter’s Laboratories, Canadian Standards Association, British Standards Institute, and
TUV (Germany). Compliance with the regulations and certification requirements of domestic and foreign government regulatory and certification authorities may delay or prevent product introductions, require additional studies or tests prior to
product introduction, require product modifications or recalls, or mandate cessation of production and marketing of existing products. The cost of compliance with applicable regulations represents a considerable expense, and significant changes in
such regulations or their interpretation could have a material adverse impact on the Company.
In the United
States, the FDA regulates the introduction, manufacturing, labeling, and record keeping requirements for medical devices and drugs. The FDA regulates the majority of products manufactured by the Company, through marketing clearance, pre-market
approvals, new drug approvals, or compliance with established monographs. The process of obtaining marketing clearance from the FDA for new products, new applications for existing products, and changes to existing products can be time-consuming and
expensive. In addition, whether separate marketing clearance is required under applicable regulations for any particular product is often a matter of interpretation and judgment. There is no assurance that marketing clearances will be granted, that
the FDA will agree or continue to agree with all judgments made from time to time by the Company with respect to whether or not marketing clearance is required for any particular new or existing product, or that review by the FDA will not involve
delays that will adversely affect the Company’s ability to commercialize
5
additional products or applications for existing products. Similar approvals by comparable agencies are required in most countries. Foreign regulatory requirements may vary widely from country to
country. The time required to obtain market clearance from a foreign country may be longer or shorter than that required by the FDA or other agencies, and clearance or approval or other product requirements may differ.
Even if regulatory clearances to market a product are obtained from the FDA or comparable foreign agencies, these clearances may entail
limitations on the indicated uses of the product. Product clearances granted by the FDA or comparable foreign agencies can also be withdrawn due to failure to comply with regulatory standards or the occurrence of unforeseen problems following
initial approval. Regulatory requirements could also limit or prevent the manufacture or distribution of the Company’s products and require the recall of such products. These applicable regulations depend heavily on administrative
interpretation, and there can be no assurance that future interpretations made by the FDA or other regulatory bodies, with possible retroactive effect, will not adversely affect the Company. Further, additional government regulation may be
established that could prevent, delay, revoke, or result in the rejection of regulatory clearance of the Company’s products. The effect of government regulation that may arise from future legislation or administrative action cannot be
predicted.
The FDA, various state agencies, and foreign regulatory agencies also have the right to inspect the
Company’s facilities from time to time to determine, among other things, whether the Company is in compliance with various regulations relating to the Quality System Regulation (“QSR”). In complying with the QSR, manufacturers must
continue to expend time, money, and effort in the areas of production and quality control to ensure full regulatory compliance.
Failure to comply with any applicable regulatory requirements could result in sanctions being imposed on the Company, including warning letters, injunctions, civil money penalties, failure of the FDA or comparable foreign agencies to
grant pre-market clearance or pre-market approval of medical devices, product recalls, operating restrictions, and, in extreme cases, criminal sanctions.
In addition, the Company is subject to regulation under state, federal, and foreign law regarding occupational safety, environmental protection, and hazardous and toxic substance control, and to other
present (and possible future) local, state, federal, and foreign regulation.
The Company believes that it is
currently in conformity in all material respects with applicable regulatory requirements. The Company has received licenses and permits it believes necessary to conduct its current manufacturing and contract sterilization businesses and believes
that it will be able to obtain any permits necessary for the future conduct of its manufacturing and contract sterilization businesses. The Company is committed to maintaining compliance with applicable FDA, EPA, and other governmental laws and
regulations and the standards promulgated by nongovernmental certification authorities.
As of March 31, 2002, the Company had 4,496 employees. Management considers
its relations with employees, including employees covered under collective bargaining agreements, to be good.
Intellectual Property and Research and Development
The Company protects its technology
and products by, among other means, filing United States and foreign patent applications that it considers important to its business. There can be no assurance, however, that any patent will provide adequate protection for the technology, system,
product, service, or process it covers. In addition, the process of obtaining and protecting patents can be long and expensive. The Company also relies upon trade secrets, technical know-how, and continuing technological innovation to develop and
maintain its competitive position.
6
Research activities are important to the Company’s business. The costs of
the Company’s research activities relating to the discovery and development of new products and the improvement of existing products amounted to $21.7 million, $24.0 million, and $24.2 million in fiscal years 2002, 2001, and 2000, respectively.
These costs are charged directly to income in the year in which incurred.
As of March 31, 2002, the Company held
203 United States patents and 305 foreign patents (with expiration dates ranging from 2002 to 2020) and had 61 United States patents and 125 foreign patents pending.
The Company also considers its various trademarks to be valuable in the marketing of its products. The Company has a total of 715 trademark registrations in the United
States and in various foreign countries in which the Company does business.
The Company’s financial results have been subject to recurring
seasonal fluctuations. A number of factors have contributed to the seasonal patterns, including sales promotion and compensation programs, customer buying patterns of capital equipment, and international business practices. Sales and profitability
of certain of the Company’s acquired and consolidated product lines have historically been disproportionately weighted toward the latter part of each quarter and generally weighted toward the latter part of each fiscal year.
As of March 31, 2002, the Company maintained backlog orders in the amount of
$104.3 million. As of March 31, 2001, the Company maintained backlog orders in the amount of $90.8 million. The majority of orders in both years were expected to ship in the subsequent fiscal year.
7
The following table sets forth the principal plants and other
materially important properties of the Company and its subsidiaries as of March 31, 2002. The Company believes that its facilities are adequate for operations and are maintained in good condition. The Company is confident that, if needed, it will be
able to acquire additional facilities at commercially reasonable rates.
| USA
|
|
|
|
|
| Mentor, OH (6 locations) |
|
Corporate Headquarters/Manufacturing/Warehousing |
|
Owned |
| Erie, PA (2 locations) |
|
Manufacturing |
|
Owned(1), Leased(1) |
| Montgomery, AL |
|
Manufacturing |
|
Owned |
| Wadsworth, OH |
|
Manufacturing |
|
Leased |
| St. Louis, MO (2 locations) |
|
Manufacturing/Warehousing |
|
Owned(1), Leased(1) |
| Reno, NV |
|
Warehousing |
|
Leased |
| Alei, HI |
|
Warehousing |
|
Leased |
| Morton Grove, IL |
|
Contract Sterilization |
|
Leased |
| Libertyville, IL (2 locations) |
|
Contract Sterilization |
|
Owned |
| Spartanburg, SC |
|
Contract Sterilization |
|
Owned |
| Groveport, OH |
|
Contract Sterilization |
|
Owned |
| Northborough, MA |
|
Contract Sterilization |
|
Owned |
| Chester, NY |
|
Contract Sterilization |
|
Owned |
| Ontario, CA |
|
Contract Sterilization |
|
Owned |
| Coon Rapids, MN |
|
Contract Sterilization |
|
Leased |
| El Paso, TX |
|
Contract Sterilization |
|
Owned |
| Sandy, UT |
|
Contract Sterilization |
|
Owned |
| Whippany, NJ |
|
Contract Sterilization |
|
Owned |
| Temecula, CA |
|
Contract Sterilization |
|
Owned |
| Nogales, AZ |
|
Contract Sterilization |
|
Owned |
| Vega Alta, PR |
|
Contract Sterilization/Sales Office |
|
Owned |
| Aliso Viejo, CA |
|
Sales Office |
|
Leased |
| Miami, FL |
|
Sales Office |
|
Leased |
| |
| Foreign Countries
|
|
|
|
|
| Basingstoke, England |
|
European Headquarters |
|
Leased |
| Quebec City, Canada
(2 locations) |
|
Manufacturing |
|
Owned |
| Sydney, Australia |
|
Manufacturing |
|
Leased |
| Helsinki, Finland |
|
Manufacturing/Sales Office |
|
Owned |
| Cologne, Germany |
|
Manufacturing/Sales Office |
|
Leased |
| Stockholm, Sweden |
|
Manufacturing/Sales Office |
|
Leased |
| Mississauga, Canada |
|
Warehousing/Sales Office |
|
Leased |
| Whitby, Canada |
|
Contract Sterilization |
|
Owned |
| Asti, Italy |
|
Sales Office |
|
Leased |
| Milan, Italy |
|
Sales Office |
|
Leased |
| Madrid, Spain |
|
Sales Office |
|
Leased |
| Paris, France |
|
Sales Office |
|
Leased |
| Kobe, Japan |
|
Sales Office |
|
Leased |
| Seoul, S. Korea |
|
Sales Office |
|
Leased |
| Singapore |
|
Sales Office |
|
Leased |
| Brussels, Belgium |
|
Sales Office |
|
Leased |
| San Jose, Costa Rica |
|
Sales Office |
|
Leased |
8
Item 3.
Legal Proceedings
Reference is made to Note 10—Commitments and
Contingencies in the accompanying consolidated financial statements on page 45 of this Form 10-K.
Item
4.
Submission of Matters to a Vote of Security Holders
No matters were
submitted to a vote of security holders during the fourth quarter of the Company’s 2002 fiscal year.
Executive Officers of the Registrant
The following table sets forth certain information
regarding the executive officers of the Company.
| Name
|
|
Age
|
|
Position
|
| |
| Les C. Vinney |
|
53 |
|
President and Chief Executive Officer |
| |
| Laurie Brlas |
|
44 |
|
Senior Vice President and Chief Financial Officer |
| |
| Peter A. Burke |
|
53 |
|
Senior Vice President and Chief Technology Officer |
| |
| Charles L. Immel |
|
40 |
|
Senior Vice President, Sales and Marketing and President, Commercial Products |
| |
| Gerard J. Reis |
|
50 |
|
Senior Vice President, Corporate Administration |
| |
| David L. Crandall |
|
55 |
|
Vice President, Manufacturing and Distribution |
| |
| Mark D. McGinley |
|
45 |
|
Vice President, General Counsel, and Secretary |
| |
| William L. Aamoth |
|
48 |
|
Corporate Treasurer |
| |
| Michael J. Tokich |
|
33 |
|
Corporate Controller |
The following is a brief account of the business experience during
the past five years of each such executive officer:
Les C. Vinney serves as President and Chief Executive
Officer. Mr. Vinney joined STERIS in August 1999 as Senior Vice President and Chief Financial Officer, became Senior Vice President of Finance and Operations in October 1999, became President and Chief Operating Officer in March 2000, and became
President and Chief Executive Officer in July 2000. Immediately before his employment with STERIS, Mr. Vinney served as Senior Vice President and Chief Financial Officer at The BF Goodrich Company, a manufacturer of advanced aerospace systems,
performance materials, and engineered industrial products. During his eight year career with BF Goodrich, Mr. Vinney held a variety of senior operating and financial management positions, including Vice President and Treasurer, President and CEO of
the former Tremco subsidiary, and Senior Vice President, Finance and Administration of BF Goodrich Specialty Chemicals.
Laurie Brlas serves as Senior Vice President and Chief Financial Officer. She joined the Company in April 2000. Prior to joining STERIS, Ms. Brlas was employed by OfficeMax, Inc., a retailer of goods and services to business
customers and consumers, from September 1995 through April 2000, serving most recently as Senior Vice President and Corporate Controller.
Peter A. Burke serves as Senior Vice President and Chief Technology Officer. Dr. Burke joined the Company in March 2001 as Vice President and Chief Technology Officer and he became Senior Vice President in March 2002.
Prior to joining STERIS, Dr. Burke was employed by Carter-Wallace, Inc., a manufacturer and distributor of consumer and pharmaceutical products, from January 1996 to March 2001, serving most recently as Vice President, Research and Development.
9
Charles L. Immel serves as Senior Vice President, Sales and Marketing and
President, Commercial Products. He joined the Company in May 2001. Prior to joining STERIS, Mr. Immel was employed by Baxter Healthcare Corporation, a medical products and services company specializing in critical care applications, from July 1983
to May 2001, serving most recently as Vice President and General Manager of Baxter’s Therapeutic Commercial Business.
Gerard J. Reis serves as Senior Vice President, Corporate Administration. He joined the Company in July 1994 as Vice President, Administration. He became Senior Vice President in October 1999.
David L. Crandall serves as Vice President, Manufacturing and Distribution. He joined the Company in April 2000. Prior to joining
the Company, Mr. Crandall was employed by United Technologies Group, a manufacturer of high technology products for the aerospace and building systems industries, from December 1968 to April 2000, serving most recently as Director of Manufacturing,
North American Operations.
Mark D. McGinley serves as Vice President, General Counsel, and Secretary. He
joined the Company in March 2002. Prior to joining STERIS, Mr. McGinley was employed by Noveon, Inc., an international specialty chemicals manufacturer. Mr. McGinley also served as Associate General Counsel of The Glidden Company, a coatings and
chemicals manufacturer, and was employed by The BF Goodrich Company, an aircraft components and specialty chemicals manufacturer, from 1990 to 2000 in various legal capacities, including General Counsel of BF Goodrich Sealants, Coatings and
Adhesives Group.
William L. Aamoth serves as Corporate Treasurer. He joined the Company in March 2001.
Prior to joining the Company, Mr. Aamoth was employed by Hayes Lemmerz International, a manufacturer of wheels, brakes, and related systems, from January 2000 through January 2001, serving as Treasurer. From May 1992 to December 1999, Mr. Aamoth was
employed by TRW, Inc., a manufacturer and service provider of automotive, aerospace, and information technology products, serving most recently as Assistant Treasurer, International.
Michael J. Tokich serves as Corporate Controller. He joined the Company in May 2000 as Assistant Corporate Controller. He became Corporate Controller in December
2000. Prior to joining the Company, Mr. Tokich was employed by OfficeMax, Inc., a retailer of goods and services to business customers and consumers, from July 1994 to May 2000, serving most recently as Divisional Vice President, Assistant
Controller.
10
PART II
Item 5.
Market for Registrant’s Common Equity and Related Shareholder Matters
Market Information and Dividends
The Company’s Common Shares are traded on the New
York Stock Exchange under the symbol “STE.” The following table sets forth, for the periods indicated, the high and low sales prices for the Company’s Common Shares.
| |
|
Quarters Ended
|
| |
|
March 31
|
|
December 31
|
|
September 30
|
|
June 30
|
| Fiscal 2002 |
|
|
|
|
|
|
|
|
|
|
|
|
| High |
|
$ |
21.42 |
|
$ |
24.91 |
|
$ |
22.75 |
|
$ |
20.34 |
| Low |
|
|
16.35 |
|
|
16.62 |
|
|
15.20 |
|
|
12.14 |
| |
| Fiscal 2001 |
|
|
|
|
|
|
|
|
|
|
|
|
| High |
|
$ |
19.25 |
|
$ |
17.19 |
|
$ |
12.50 |
|