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United States securities and exchange commission logo
April 8, 2024
Brian G. Andrews
Executive Vice President, Chief Financial Officer and Treasurer
COOPER COMPANIES, INC.
6101 Bollinger Canyon Road, Suite 500
San Ramon, California 94583
Re: COOPER COMPANIES,
INC.
Form 10-K for
Fiscal Year Ended October 31, 2023
Filed December 8,
2023
Form 8-K Filed
December 7, 2023
File No. 001-08597
Dear Brian G. Andrews:
We have limited our review of your filing to the financial
statements and related
disclosures and have the following comments.
Please respond to this letter within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe a
comment applies to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to this letter, we may have additional comments.
Form 10-K for Fiscal Year Ended October 31, 2023
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Critical Accounting Estimates, page 53
1. The disclosures you
have provided for each of your identified critical estimates appear to
provide investors with
a discussion as to how you are accounting for these items in
accordance with US GAAP
and are similar to your significant accounting policies
disclosures rather than
providing investors with an understanding as to what the critical
estimates being made
are and how the uncertainty associated with those estimates may
impact your
consolidated financial statements. Please revise the disclosures for each of
your critical estimates
made in preparing your consolidated financial statements to comply
with the guidance in
Section 501.14 of the Financial Reporting Codification. Ensure your
disclosures
sufficiently explain to investors what each critical estimate is; the
uncertainties
associated with the
critical estimates; the methods and assumptions used to make the
critical estimates,
including an explanation as to how you arrived at the assumptions used;
Brian G. Andrews
FirstName LastNameBrianINC.
G. Andrews
COOPER COMPANIES,
Comapany
April NameCOOPER COMPANIES, INC.
8, 2024
April 28, 2024 Page 2
Page
FirstName LastName
the events or transactions that could materially impact the
assumptions made; and how
reasonably likely changes to those assumptions could impact your
consolidated financial
statements. Provide investors with quantified information to the
extent meaningful and
available.
Consolidated Statements of Income, page 57
2. We note from your disclosures in Item 1. Business and from your
revenue recognition
accounting policy that you offer products and services to your
customers. Please tell us
what consideration was given to separately presenting net sales and
cost of sales from
products and from services. As part of your response, please provide
us with such
information for the periods presented. Refer to Article 5-03(b)(1) and
(2) of Regulation S-
X.
3. We note that you are presenting amortization of intangible separately
and also presenting
a gross profit measure. Please tell us your consideration of the
guidance in SAB Topic
11:B and how you concluded that the gross profit measure is fully
burdened. As part of
your response, please confirm that you will expand your disclosures in
Note 4 to clarify
what the composite intangible asset represents and why the components
are not reflected
separately or within the corresponding categories already presented.
Note 1. Organization and Significant Accounting Policies
Revenue Recognition, page 63
4. We note that with the acquisition of Generate Life Sciences on
December 17, 2021, you
began offering donor egg and sperm for fertility treatments, fertility
cryopreservation
services and newborn stem cell storage (cord blood & cord tissue)
services. Please
expand your revenue recognition policy to provide the disclosures for
revenues related to
the various services you provide including identification of the
performance obligations
(i.e., when typically satisfied, significant payment terms, nature of
goods and services,
obligations for returns, refunds, and other similar obligations, and
types of warranties and
related obligations) with reference to ASC 606-10-50-12 and 50-12A,
significant
judgments for the method used to recognize revenue over time and why
the method
faithfully depicts the transfer of the services with reference to ASC
606-10-50-18, variable
consideration and any other obligations with reference to ASC
606-10-50-20.
Note 3. Acquisitions and Joint Venture
Joint Venture, page 70
5. We note that in connection with the sale of a 50% interest in SGV to
Essilor in March
2022 for $52.1 million, the creation of a new joint venture in which
each party contributed
their interest in SGV along with a $10 million cash payment, you
remeasured the fair
value of your retained equity investment in the new joint venture at
$90 million resulting
in the recognition of a $56.9 million gain. Please tell us the facts
and circumstances and
your consideration of the guidance in ASC 820 that lead you to
concluded that your 50%
Brian G. Andrews
FirstName LastNameBrianINC.
G. Andrews
COOPER COMPANIES,
Comapany
April NameCOOPER COMPANIES, INC.
8, 2024
April 38, 2024 Page 3
Page
FirstName LastName
ownership interest had a fair value of $90 million considering Essilor
had just acquired the
other 50% for $52.1 million.
Note 6. Income Taxes, page 74
6. Please expand your disclosures to address the following:
Revise your presentation of the components of your deferred tax
assets and liabilities
to disclose the amount by type of asset or liability. In this
regard, we note your
presentation of foreign deferred tax assets and liabilities that
does not communicate
to an investor the type of asset or liability. Refer to ASC
740-10-50-6 for guidance.
We note that you reduced the valuation allowance by $42 million,
which was offset
by an increase of $2.6 million. However, we did not note a
reconciling item for these
changes in the effective tax rate reconciliation. Please
separately present the impact
of changes in the valuation allowance in accordance with ASC
740-10-50-12 and
Article 4-08(h)(2) of Regulation S-X given the significance to
your provision for
income tax and net income.
Disclose here or in the significant accounting policies footnote
disclosure your
accounting policy election to provide for the tax on Global
Intangible Low Taxed
Income (GILTI) earned by certain foreign subsidiaries. In
addition, disclose the
remaining amount of the one-time transition tax to be remitted. In
your fiscal year
2019 10-K, you stated that you intended to remit payment over an
eight-year period.
Form 8-K Filed December 7, 2023
Exhibit 99.1
7. We note that you provide a discussion and analysis for your non-GAAP
measures without
providing a discussion and analysis of the comparable US GAAP measure
throughout the
earnings release. With reference to Item 10(e)(1)(i)(A) of Regulation
S-K and Question
102.10(a) of the Compliance and Disclosure Interpretations for
Non-GAAP Financial
Measures, ensure your disclosures, discussion and other presentations
do not present,
discuss and/or analyze non-GAAP financial measures with more
prominence than the
most directly comparable US GAAP measure.
8. We note your characterization of certain adjustments as unusual,
including certain
litigation expense, gain or loss on deconsolidation of subsidiaries,
changes in the fair
value of contingent consideration and product transition costs. Please
revise your
description of these types of adjustment to comply with the guidance
in Question 102.03
of the Compliance and Disclosure Interpretations for Non-GAAP
Financial Measures.
9. Please provide reconciliations for the percentage change in revenue on
a constant currency
basis and organic basis, non-GAAP gross margin; non-GAAP operating
margin; operating
expense excluding amortization; and net debt as required by Rule
100(a) of Regulation G
and Item 10(e)(1)(i)(B) of Regulation S-K.
Brian G. Andrews
COOPER COMPANIES, INC.
April 8, 2024
Page 4
10. Please revise your reconciliations to begin with the most comparable
US GAAP measure
and to separately present each material adjustment to the US GAAP
measure. Provide
footnote disclosures describing what each adjustment represents and to
quantify the
components of the adjustment when the adjustment is broad (e.g.,
restructuring charges or
acquisition-related expenses). Refer to Item 10(e)(1)(i)(B) of
Regulation S-K, Question
102.10(b) of the Compliance and Disclosure Interpretations for
Non-GAAP Financial
Measures, and the answer to Question 102.12 of the Compliance and
Disclosure
Interpretations for Non-GAAP Financial Measures.
11. Please provide us with the components of Adjustment B for each period
presented with
reference to your description of what types of costs are included in
acquisition and
integration expenses. To the extent that a portion of this adjustment
relates to personnel
costs for transitional employees and other acquired employee related
costs, provide us
with your consideration of the guidance in Question 100.01 of the
Compliance and
Disclosure Interpretations for Non-GAAP Financial Measures.
12. Please provide a more comprehensive explanation for the adjustment to
provision for
income taxes. In this regard, we note that you made adjustments to
fiscal year 2023 to
arrive at non-GAAP diluted earnings per share totaling $324 million
but decreased the
provision for income taxes by $20.1 million without an explanation.
Refer to Question
102.11 of the Compliance and Disclosure Interpretations for Non-GAAP
Financial
Measures.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
Please contact Tracey Houser at 202-551-3736 or Terence O'Brien at
202-551-3355 with
any questions.
Sincerely,
FirstName LastNameBrian G. Andrews
Division of
Corporation Finance
Comapany NameCOOPER COMPANIES, INC.
Office of
Industrial Applications and
April 8, 2024 Page 4 Services
FirstName LastName