Company: ICUI
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0000883984-25-000007
Chunk: 169

Company: ICU MEDICAL INC/DE
Filing Date: 2025-02-27
Form: 10-K
Item: Item 1
Chunk 169
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 2023, as compared to 2022, primarily due to lower sales volume of IV Solutions which was impacted by supply disruptions related to finished good products purchased from third-party manufacturers and lower sales volume for products acquired from Smiths Group plc ("Smiths") due to backorder recovery in 2022. 

Gross Margins

Gross margins were 34.6%, 32.8% and 30.6% for 2024, 2023 and 2022, respectively.  

45

The increase in gross margin in 2024, as compared to 2023, was primarily driven by lower supply chain costs due to synergies and freight rates, price increases, reduced spend on quality remediation activities and the impact of foreign exchange rate changes which was partially offset by lower manufacturing absorption and higher inventory write-offs.

The increase in gross margin in 2023, as compared to 2022, was primarily driven by lower freight costs, lower spend on quality remediation and the cost recognition of a purchase accounting write-up of inventory in 2022, offset by continued inflationary impacts on costs and stronger Mexican peso.

Selling, General and Administrative ("SG&A") Expenses

The following table summarizes our SG&A expenses (in millions, except percentages):

Year Ended December 31,$ change % change $ change % change 2024202320222024 over 20232023 over 2022SG&A$638.8 $606.7 $608.3 $32.1 5.3 %$(1.6)(0.3)%

Consolidated SG&A expenses increased in 2024, as compared to 2023, primarily due to increases of $11.3 million in compensation costs, $9.4 million in commissions, $5.6 million in stock based compensation and $5.2 million in dealer fees. The increases were partially offset by decreases of  $8.8 million in depreciation and amortization. Compensation costs increased primarily due to an increase in cash incentive compensation and employee benefits. Commissions increased primarily due to increased sales performance in the current period measured against preset sales targets as compared to sales performance achieved against targets in the comparable prior year period. Stock based compensation primarily increased due to a change in the probability of meeting a certain earning potential related to a performance based equity award. Dealer fees increased due to an increase in revenues to distributors. Depreciation and amortization decreased in 2024 due to certain assets reaching the end of