424B3 10.9.2014


Filed Pursuant to Rule 424(b)(3)
Registration No. 333-194855
PROSPECTUS SUPPLEMENT
(to prospectus dated October 7, 2014)
BIOMET, INC.
$1,825,000,000 6.500% Senior Notes due 2020
$800,000,000 6.500% Senior Subordinated Notes due 2020
 
 
This prospectus supplement updates and supplements the prospectus dated October 7, 2014.
See the “Risk Factors” section beginning on page 6 of the prospectus for a discussion of certain risks that you should consider before investing in the notes.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
This prospectus supplement and the accompanying prospectus have been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes affected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales.
You should rely only on the information contained or incorporated by reference in this prospectus supplement and the accompanying prospectus. We have not authorized any person to provide you with any information or represent anything about us or this offering that is not contained in this prospectus supplement and the accompanying prospectus. If given or made, any such other information or representation should not be relied upon as having been authorized by us. This prospectus supplement and the accompanying prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained or incorporated by reference in this prospectus supplement and the accompanying prospectus is accurate as of any date other than the date on the front cover of this prospectus supplement and the accompanying prospectus or the date of any document incorporated by reference herein.
 
The date of this prospectus supplement is October 9, 2014.




FIRST QUARTER OF FISCAL YEAR 2015 FINANCIAL RESULTS

First Quarter Financial Results

•
Consolidated net sales increased 6.0% worldwide to approximately $775 million
•
Knee sales grew 4.3% worldwide to $234.7 million
•
Hip sales increased 3.8% worldwide to $155.3 million
•
S.E.T. sales increased 3.4% worldwide to $154.5 million

Consolidated net sales increased 6.0% to $774.8 million worldwide during the first quarter of fiscal year 2015, compared to net sales of $730.7 million during the first quarter of fiscal year 2014. U.S. net sales increased 5.4% during the first quarter to $495.1 million, while Europe net sales increased 6.5% to $161.3 million and International (primarily Canada, Latin America and the Asia Pacific region) net sales increased 8.3% to $118.4 million. On a consolidated basis, the Company had the same number of selling days in the quarter compared to the prior year quarter.
Reported operating income was $82.5 million during the first quarter of fiscal year 2015, compared to an operating income of $96.4 million during the first quarter of fiscal year 2014.
Reported net income in the quarter was $7.3 million, compared to a net income of $31.1 million during the first quarter of the prior year.
Reported cash flow from operations totaled $2.4 million during the first quarter of fiscal year 2015, compared to reported cash flow from operations of $50.8 million for the first quarter of fiscal year 2014.
At August 31, 2014, reported gross debt was $5,736.3 million, and cash and cash equivalents totaled $192.0 million, compared to $5,472.8 million at May 31, 2014.

About Biomet
Biomet, Inc. and its subsidiaries design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. Biomet's product portfolio includes hip and knee reconstructive products; sports medicine, extremities and trauma products; spine, bone healing and microfixation products; dental reconstructive products; and cement, biologics and other products. Headquartered in Warsaw, Indiana, Biomet and its subsidiaries currently distribute products in approximately 90 countries.

Financial Schedule Presentation
The Company’s unaudited condensed consolidated financial statements as of and for the three months ended August 31, 2014 and 2013 and other financial data included in this press release have been prepared in a manner that complies, in all material respects, with generally accepted accounting principles in the United States (except with respect to certain non-GAAP financial measures discussed below), and reflects purchase accounting adjustments related to the Merger referenced below and acquisitions.
Reclassifications
Certain prior period amounts have been reclassified to conform to the current presentation. The current presentation aligns with how the Company presently reports sales and markets its products. The Company also reclassified instrument depreciation from cost of sales to selling, general and administrative expense.

Rounding
Amounts may not recalculate due to rounding.






Biomet, Inc.
Product Net Sales
Three Months Ended August 31, 2014 and 2013
(in millions, except percentages, unaudited)
 
 
Three Months Ended August 31, 2014
 
Three Months Ended August 31, 2013
 
Reported
Growth %
 
United
States
Growth %
Knees
 
$
234.7

 
$
225.1

 
4.3
 %
 
2.2
%
Hips
 
155.3

 
149.7

 
3.8
 %
 
2.6
%
Sports, Extremities, Trauma (S.E.T.)
 
154.5

 
149.5

 
3.4
 %
 
1.3
%
Spine, Bone Healing and Microfixation
 
122.8

 
101.6

 
20.9
 %
 
20.9
%
Dental
 
53.7

 
53.9

 
(0.5
)%
 
1.3
%
Cement, Biologics and Other
 
53.8

 
50.9

 
5.5
 %
 
3.3
%
Net Sales
 
$
774.8

 
$
730.7

 
6.0
 %
 
5.4
%
 




Biomet, Inc.
Geographic Net Sales
Three Months Ended August 31, 2014 and 2013
(in millions, except percentages, unaudited)
 
 
Three Months Ended August 31, 2014
 
Three Months Ended August 31, 2013
 
Reported
Growth %
Geographic Sales:
 
 
 
 
 
United States
$
495.1

 
$
469.9

 
5.4
%
Europe
161.3

 
151.5

 
6.5
%
International
118.4

 
109.3

 
8.3
%
Net Sales
$
774.8

 
$
730.7

 
6.0
%
 

 






Biomet, Inc.
Consolidated Statements of Operations
Three Months Ended August 31, 2014 and 2013
(in millions, except percentages, unaudited)

 
 
Three Months Ended August 31,
 
 
2014
 
2013
Net sales
 
$
774.8

 
$
730.7

Cost of sales
 
215.9

 
208.0

Gross profit
 
558.9

 
522.7

Selling, general and administrative expense
 
361.7

 
313.3

Research and development expense
 
42.8

 
37.5

Amortization
 
71.9

 
75.5

Operating income
 
82.5

 
96.4

Interest expense
 
80.1

 
87.6

Other (income) expense
 
(4.2
)
 
2.2

Income before income taxes
 
6.6

 
6.6

Benefit for income taxes
 
(0.7
)
 
(24.5
)
Net income
 
$
7.3

 
$
31.1










Biomet, Inc.
Condensed Consolidated Balance Sheets
(in millions, unaudited)
 
 
 
August 31, 2014
 
May 31, 2014
Assets
 
 
 
 
Cash and cash equivalents
 
$
192.0

 
$
247.6

Accounts receivable, net
 
530.4

 
577.3

Inventories
 
724.2

 
693.4

Current deferred income taxes
 
149.2

 
149.9

Prepaid expenses and other
 
184.4

 
202.9

Property, plant and equipment, net
 
723.3

 
716.0

Intangible assets, net
 
3,350.8

 
3,439.6

Goodwill
 
3,627.8

 
3,634.4

Other assets
 
115.0

 
105.5

Total Assets
 
$
9,597.1

 
$
9,766.6

Liabilities and Shareholder’s Equity
 
 
 
 
Current liabilities, excluding debt
 
$
592.6

 
$
712.1

Current portion of long-term debt
 
132.8

 
133.1

Long-term debt, net of current portion
 
5,603.5

 
5,587.3

Deferred income taxes, long-term
 
939.3

 
968.6

Other long-term liabilities
 
252.7

 
256.3

Shareholder’s equity
 
2,076.2

 
2,109.2

Total Liabilities and Shareholder’s Equity
 
$
9,597.1

 
$
9,766.6

 





























Biomet, Inc.
Consolidated Statement of Cash Flows
(in millions, unaudited)
 

Three Months Ended
August 31, 2014
 
Three Months Ended August 31, 2013
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES:
 
 
 
Net income
$
7.3

 
$
31.1

Adjustments to reconcile net loss to net cash provided by operating activities:
 
 
 
Depreciation and amortization
122.1

 
120.4

Amortization and write off of deferred financing costs
2.8

 
3.6

Stock-based compensation expense
3.6

 
4.2

Provision for (recovery) of doubtful accounts receivable
(1.0
)
 
0.1

Deferred income taxes
(29.8
)
 
(61.0
)
Other
(3.6
)
 
(3.9
)
Changes in operating assets and liabilities, net of acquired assets:
 
 
 
Accounts receivable
40.9

 
8.0

Inventories
(36.7
)
 
(7.5
)
Prepaid expenses
20.6

 
2.3

Accounts payable
(14.0
)
 
(19.6
)
Income taxes
4.0

 
17.0

Accrued interest
(16.6
)
 
(16.2
)
Accrued wages and commissions
(48.2
)
 
(34.8
)
Accrued expenses and other
(49.0
)
 
7.1

Net cash provided by operating activities
2.4

 
50.8

CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES:
 
 
 
Proceeds from sales/maturities of investments
—

 
9.5

Purchases of investments
(16.3
)
 
(9.5
)
Proceeds from sale of assets
—

 
0.2

Capital expenditures
(60.8
)
 
(46.5
)
Other acquisitions, net of cash acquired
(0.3
)
 
(0.4
)
Net cash used in investing activities
(77.4
)
 
(46.7
)
CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES:
 
 
 
Debt:
 
 
 
Payments under European facilities
—

 
(2.3
)
Payments under senior secured credit facilities
(7.8
)
 
(8.3
)
Proceeds under revolvers
205.0

 
2.3

Payments under revolvers
—

 
(5.0
)
Retirement of term loans
(180.0
)
 
—

Payment of fees related to refinancing activities
—

 
(0.2
)
Equity:
 
 
 
Option exercises
0.3

 
0.3

Net cash provided by (used in) financing activities
17.5

 
(13.2
)
Effect of exchange rate changes on cash
1.9

 
(1.1
)
Increase (decrease) in cash and cash equivalents
(55.6
)
 
(10.2
)
Cash and cash equivalents, beginning of period
247.6

 
355.6

Cash and cash equivalents, end of period
$
192.0

 
$
345.4

 
 
 
 




Supplemental disclosures of cash flow information:
 
 
 
Cash paid during the period for:
 
 
 
Interest
$
93.8

 
$
101.3

Income taxes
$
19.4

 
$
32.2