ango-20230831

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended August 31, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 0-50761

AngioDynamics, Inc.

(Exact name of registrant as specified in its charter)


Delaware						11-3146460
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

14 Plaza Drive, Latham, New York 12110

(Address of principal executive offices and zip code)

(518) 795-1400

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading symbol

Name of each exchange on which registered

Common Stock, par value $.01

ANGO

NASDAQ Global Select Market

Preferred Stock Purchase Rights

NASDAQ Global Select Market

Securities registered pursuant to Section 12(g) of the Act:

None

(Title of Class)

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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☒

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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer

☐

Accelerated filer

☒

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the Registrant’s classes of common stock, as of the latest practicable date.


Class						Outstanding as of October 3, 2023
Common Stock, par value $.01						39,846,641

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AngioDynamics, Inc. and Subsidiaries

TABLE OF CONTENTS


		Page
	Part I: Financial Information

Item 1.	Financial Statements

	Consolidated Statements of Operations (unaudited)	3

	Consolidated Statements of Comprehensive Income (Loss) (unaudited)	4

	Consolidated Balance Sheets (unaudited)	5

	Consolidated Statements of Cash Flows (unaudited)	6

	Consolidated Statements of Stockholders’ Equity (unaudited)	7

	Notes to Consolidated Financial Statements (unaudited)	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28

Item 4.	Controls and Procedures	29

	Part II: Other Information

Item 1.	Legal Proceedings	30

Item 1A.	Risk Factors	30

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30

Item 3.	Defaults on Senior Securities	30

Item 4.	Mine Safety Disclosures	30

Item 5.	Other Information	30

Item 6.	Exhibits	31

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PART 1. FINANCIAL INFORMATION

Item 1. Financial Statements.

AngioDynamics, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands of dollars, except per share data)


	Three Months Ended
	Aug 31, 2023		Aug 31, 2022
Net sales	$	78,679	$	81,537
Cost of sales (exclusive of intangible amortization)	38,619		39,232
Gross profit	40,060		42,305
Operating expenses:
Research and development	7,941		8,333
Sales and marketing	27,368		26,543
General and administrative	10,856		10,101
Amortization of intangibles	3,625		4,837
Change in fair value of contingent consideration	(130)		211
Acquisition, restructuring and other items, net	3,212		5,581
Total operating expenses	52,872		55,606
Gain on sale of assets	47,842		—
Operating income (loss)	35,030		(13,301)
Other expense:
Interest income (expense), net	119		(381)
Other expense, net	(288)		(175)
Total other expense, net	(169)		(556)
Income (loss) before income tax benefit	34,861		(13,857)
Income tax benefit	(11,023)		(853)
Net income (loss)	$	45,884	$	(13,004)


Earnings (loss) per share
Basic	$	1.15	$	(0.33)
Diluted	$	1.15	$	(0.33)






Weighted average shares outstanding
Basic	39,842		39,302
Diluted	39,968		39,302

The accompanying notes are an integral part of these consolidated financial statements.

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AngioDynamics, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited)

(in thousands of dollars)


	Three Months Ended
	Aug 31, 2023		Aug 31, 2022
Net income (loss)	$	45,884	$	(13,004)
Other comprehensive loss, before tax:

Foreign currency translation loss	(930)		(550)
Other comprehensive loss, before tax	(930)		(550)
Income tax expense related to items of other comprehensive loss	—		—
Other comprehensive loss, net of tax	(930)		(550)
Total comprehensive income (loss), net of tax	$	44,954	$	(13,554)

The accompanying notes are an integral part of these consolidated financial statements.

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AngioDynamics, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

(unaudited)

(in thousands of dollars, except share data)


	Aug 31, 2023		May 31, 2023
Assets
Current assets
Cash and cash equivalents	$	57,586	$	44,620

Accounts receivable, net of allowances of $1,878 and $2,150 respectively	49,755		52,826
Inventories	59,972		55,325


Prepaid expenses and other	8,162		4,617
Current assets held for sale	—		6,154
Total current assets	175,475		163,542
Property, plant and equipment, net	43,356		44,384
Intangible assets, net	106,671		111,144
Goodwill	159,017		159,238
Other assets	9,430		10,676
Non-current assets held for sale	—		43,653
Total assets	$	493,949	$	532,637
Liabilities and stockholders' equity
Current liabilities
Accounts payable	$	24,807	$	40,445
Accrued liabilities	26,079		26,617


Current portion of contingent consideration	4,729		14,761
Other current liabilities	1,837		2,002
Total current liabilities	57,452		83,825
Long-term debt	—		49,818
Deferred income taxes	1,279		12,813
Contingent consideration, net of current portion	4,438		4,535
Other long-term liabilities	2,976		3,350
Total liabilities	66,145		154,341
Commitments and contingencies (Note 14)
Stockholders' equity
Preferred stock, par value $0.01 per share, 5,000,000 shares authorized; no shares issued and outstanding	—		—
Common stock, par value $0.01 per share, 75,000,000 shares authorized; 40,586,641 and 39,981,422 shares issued and 40,216,641 and 39,611,422 shares outstanding at August 31, 2023 and May 31, 2023, respectively	383		382
Additional paid-in capital	603,759		599,206
Accumulated deficit	(164,971)		(210,855)
Treasury stock, 370,000 shares at August 31, 2023 and May 31, 2023, respectively	(5,714)		(5,714)
Accumulated other comprehensive income	(5,653)		(4,723)
Total Stockholders’ Equity	427,804		378,296
Total Liabilities and Stockholders' Equity	$	493,949	$	532,637

The accompanying notes are an integral part of these consolidated financial statements.

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AngioDynamics, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(in thousands of dollars)


	Three Months Ended
	Aug 31, 2023		Aug 31, 2022
Cash flows from operating activities:
Net income (loss)	$	45,884	$	(13,004)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization	6,688		7,660
Non-cash lease expense	476		621
Stock based compensation	4,144		3,024
Gain on disposal of assets	(47,842)		—
Transaction costs for disposition	(2,427)		—
Change in fair value of contingent consideration	(130)		211

Deferred income taxes	(11,415)		(907)
Change in accounts receivable allowances	(78)		45
Fixed and intangible asset impairments and disposals	65		87

Write-off of other assets	869		—
Other	(9)		(96)
Changes in operating assets and liabilities:
Accounts receivable	3,157		(1,425)
Inventories	(4,574)		(6,238)
Prepaid expenses and other	(4,168)		(5,733)
Accounts payable, accrued and other liabilities	(16,539)		(8,990)
Net cash used in operating activities	(25,899)		(24,745)
Cash flows from investing activities:
Additions to property, plant and equipment	(791)		(809)
Additions to placement and evaluation units	(767)		(2,227)
Acquisition of intangibles	—		(540)



Proceeds from sale of assets	100,000		—
Net cash provided by (used in) investing activities	98,442		(3,576)
Cash flows from financing activities:
Repayment of long-term debt	(50,000)		(45,000)
Proceeds from borrowings on long-term debt	—		70,000
Deferred financing costs on long-term debt	—		(706)
Payment of acquisition related contingent consideration	(10,000)		—

Proceeds from exercise of stock options and employee stock purchase plan	410		82
Net cash (used in) provided by financing activities	(59,590)		24,376
Effect of exchange rate changes on cash and cash equivalents	13		(316)
Increase (decrease) in cash and cash equivalents	12,966		(4,261)
Cash and cash equivalents at beginning of period	44,620		28,825
Cash and cash equivalents at end of period	$	57,586	$	24,564

Supplemental disclosure of non-cash investing and financing activities:

Accrual for capital expenditures incurred during the period	$	(68)	$	426

The accompanying notes are an integral part of these consolidated financial statements.

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AngioDynamics, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited)

(in thousands of dollars, except share data)


	Common Stock			Additional paid in capital		Accumulated deficit		Accumulated other comprehensive loss		Treasury Stock
	Shares	Amount								Shares	Amount		Total
Balance at May 31, 2023	39,981,422	$	382	$	599,206	$	(210,855)	$	(4,723)	(370,000)	$	(5,714)	$	378,296
Net income						45,884							45,884

Issuance/Cancellation of restricted stock units	386,031			(280)									(280)
Issuance/Cancellation of performance share units	87,377			(210)									(210)
Purchases of common stock under ESPP	131,811	1		899									900
Stock-based compensation				4,144									4,144


Other comprehensive loss, net of tax								(930)					(930)
Balance at August 31, 2023	40,586,641	$	383	$	603,759	$	(164,971)	$	(5,653)	(370,000)	$	(5,714)	$	427,804


	Common Stock			Additional paid in capital		Accumulated deficit		Accumulated other comprehensive income		Treasury Stock
	Shares	Amount								Shares	Amount		Total
Balance at May 31, 2022	39,541,173	$	380	$	586,879	$	(158,413)	$	1,357	(370,000)	$	(5,714)	$	424,489
Net loss						(13,004)							(13,004)
Exercise of stock options	6,617			(29)									(29)
Issuance/Cancellation of restricted stock units	213,241			(648)									(648)
Issuance/Cancellation of performance share units	29,826			(312)									(312)
Purchases of common stock under ESPP	56,894	1		1,070									1,071
Stock-based compensation				3,024									3,024


Other comprehensive loss, net of tax								(550)					(550)
Balance at August 31, 2022	39,847,751	$	381	$	589,984	$	(171,417)	$	807	(370,000)	$	(5,714)	$	414,041

The accompanying notes are an integral part of these consolidated financial statements.

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AngioDynamics, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Statements of Operations and the Consolidated Statements of Comprehensive Income (Loss) for the three months ended August 31, 2023 and 2022, the Consolidated Balance Sheet as of August 31, 2023, the Consolidated Statements of Cash Flows for the three months ended August 31, 2023 and 2022, and the Consolidated Statements of Stockholders’ Equity for the three months ended August 31, 2023 and 2022 have been prepared by the Company and are unaudited. The Consolidated Balance Sheet as of May 31, 2023 was derived from audited consolidated financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary to state fairly the financial position, changes in stockholders’ equity and comprehensive income, results of operations and cash flows as of and for the period ended August 31, 2023 (and for all periods presented) have been made.

The unaudited interim consolidated financial statements for the three months ended August 31, 2023 and 2022 include the accounts of AngioDynamics, Inc. and its wholly owned subsidiaries (collectively, the "Company", "we", "our" or "us"). All intercompany balances and transactions have been eliminated.

2. DIVESTITURES

Pursuant to an asset purchase agreement dated June 8, 2023 (the "Asset Purchase Agreement"), the Company completed the sale of the dialysis and BioSentry tract sealant system biopsy businesses (the "Divestiture") to Merit Medical Systems, Inc. ("Merit"). Total consideration received by the Company for the Divestiture in the first quarter of fiscal year 2024 was $100.0 million in cash and resulted in a pre-tax book gain of $47.8 million.

The Company and Merit entered into various agreements to facilitate the transition of the divested businesses to Merit, including a Transition Services Agreement and Contract Manufacturing Agreement. The Company determined that the sale of the businesses did not constitute a strategic shift that had a major effect on the Company's operations or financial results and as a result, this transaction will not be classified as discontinued operations.

The following table summarizes the major classes of assets sold on the date of the sale:


(in thousands)	As of June 8, 2023
Current assets:
Inventories	$	4,068
Prepaid expenses and other	2,000
Total current assets	$	6,068
Non-current assets:
Property, plant and equipment, net	$	54
Intangible assets, net	17,629
Goodwill	25,980
Total non-current assets	$	43,663

3. REVENUE FROM CONTRACTS WITH CUSTOMERS

Revenue Recognition

Under ASC 606, Revenue from Contracts with Customers, revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation.

The Company has one primary revenue stream which is the sales of its products.

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Disaggregation of Revenue

The following table summarizes net sales by Med Tech, Med Device and by geography:


	Three Months Ended August 31, 2023						Three Months Ended August 31, 2022
(in thousands)	United States		International		Total		United States		International		Total
Net sales
Med Tech	$	22,242	$	3,618	$	25,860	$	20,442	$	2,375	$	22,817
Med Device	42,157		10,662		52,819		48,581		10,139		58,720
Total	$	64,399	$	14,280	$	78,679	$	69,023	$	12,514	$	81,537

Net Product Revenue

The Company's products consist of a wide range of medical, surgical and diagnostic devices used by professional healthcare providers for vascular access, for the treatment of peripheral vascular disease and for use in oncology and surgical settings. The Company's products are generally used in minimally invasive, image-guided procedures. Most of the Company's products are intended to be used once and then discarded, or they may be implanted for short or long term use. The Company sells its products to its distributors and to end users, such as interventional radiologists, interventional cardiologists, vascular surgeons, urologists, interventional and surgical oncologists and critical care nurses.

Contracts and Performance Obligations

The Company contracts with its customers based on customer purchase orders, which in many cases are governed by master purchasing agreements. The Company’s contracts with customers are generally for product only, and do not include other performance obligations such as services or other material rights. As part of its assessment of each contract, the Company evaluates certain factors including the customer’s ability to pay (or credit risk). For each contract, the Company considers the promise to transfer products, each of which is distinct, to be the identified performance obligations.

Transaction Price and Allocation to Performance Obligations

Transaction prices of products are typically based on contracted rates. Product revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products to a customer, net of any variable consideration as described below.

If a contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price based on the estimated relative standalone selling prices of the promised products underlying each performance obligation. The Company has standard pricing for its products and determines standalone selling prices based on the price at which the performance obligation is sold separately.

Revenue Recognition

Revenue is recognized when control of the product is transferred to the customer (i.e., when the Company’s performance obligation is satisfied), which occurs at a point in time, and may be upon shipment from the Company’s manufacturing site or delivery to the customer’s named location, based on the shipping terms of a contract.

In determining whether control has transferred, the Company considers if there is a present right to payment from the customer and when physical possession, legal title and risks and rewards of ownership have transferred to the customer.

The Company typically invoices customers upon satisfaction of identified performance obligations. As the Company’s standard payment terms are 30 to 90 days from invoicing, the Company does not provide any significant financing to its customers.

The Company enters into agreements to place placement and evaluation units (“units”) at customer sites, but the Company retains title to the units. For the duration of these agreements the customer has the right to use the unit at no upfront charge in connection with the customer’s ongoing purchase of disposables. These types of agreements include an embedded operating lease for the right to use the units. In these arrangements, revenue recognized for the sale of the disposables is not allocated between the disposal revenue and lease revenue due to the insignificant value of the units in relation to the total agreement value.

Sales, value add, and other taxes collected on behalf of third parties are excluded from revenue.

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Variable Consideration

Reserves: Revenue from product sales are recorded at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established for discounts, returns, rebates and allowances that are offered within contracts between the Company and its customers. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as a contra asset.

Rebates and Allowances: The Company provides certain customers with rebates and allowances that are explicitly stated in the Company’s contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized. The Company establishes reserves for such amounts, which is included in accrued expenses in the accompanying Consolidated Balance Sheets. These rebates and allowances result from performance-based offers that are primarily based on attaining contractually specified sales volumes. The Company is also required to pay administrative fees to group purchasing organizations.

Product Returns: The Company generally offers customers a limited right of return. Product returns after 30 days must be pre-approved by the Company and customers may be subject to a 20% restocking charge. To be accepted, a returned product must be unadulterated, undamaged and have at least twelve months remaining prior to its expiration date. The Company estimates the amount of its product sales that may be returned by its customers and records this estimate as a reduction of revenue in the period the related product revenue is recognized. The Company currently estimates product return liabilities using its historical product return information and considers other factors that it believes could significantly impact its expected returns, including product recalls. During the three months ended August 31, 2023, such product returns were not material.

Contract Balances with Customers

A receivable is generally recognized in the period the Company ships the product. Payment terms on invoiced amounts are based on contractual terms with each customer and generally coincide with revenue recognition. Accordingly, the Company does not have any contract assets associated with the future right to invoice its customers. In some cases, if control of the product has not yet transferred to the customer or the timing of the payments made by the customer precedes the Company’s fulfillment of the performance obligation, the Company recognizes a contract liability that is included in deferred revenue in the accompanying Consolidated Balance Sheets.

The following table presents changes in the Company’s receivables, contract assets and contract liabilities with customers:


(in thousands)	Aug 31, 2023		May 31, 2023
Receivables	$	49,755	$	52,826
Contract assets	$	—	$	—
Contract liabilities	$	433	$	499

During the three months ended August 31, 2023, the Company had immaterial additions to contract liabilities. This was offset by $0.1 million in revenue that was recognized during the three months ended August 31, 2023.

Costs to Obtain or Fulfill a Customer Contract

Under ASC 606, the Company may recognize an asset for incremental costs of obtaining a contract with a customer if it expects to recover those costs. The Company’s sales incentive compensation plans qualify for capitalization since these plans are directly related to sales achieved during a period of time. However, the Company has elected the practical expedient under ASC 340-40-25-4 to expense the costs as they are incurred within selling and marketing expenses since the amortization period is less than one year.

The Company accounts for shipping and handling activities related to contracts with customers as costs to fulfill the promise to transfer the associated products. Shipping and handling costs, associated with the distribution of finished products to customers, are recorded in costs of goods sold and are recognized when the related finished product is shipped to the customer. Amounts charged to customers for shipping and handling are recorded in net sales.

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4. INVENTORIES

Inventories are stated at lower of cost and net realizable value (using the first-in, first-out method). Inventories consisted of the following:


(in thousands)	Aug 31, 2023		May 31, 2023
Raw materials	$	30,737	$	28,679
Work in process	8,162		6,708
Finished goods	21,073		19,938
Inventories	$	59,972	$	55,325

The Company periodically reviews inventory for both obsolescence and loss of value. The Company makes assumptions about the future demand for and market value of the inventory. Based on these assumptions, the Company estimates the amount of obsolete, expiring and slow-moving inventory. The total inventory reserve at August 31, 2023 and May 31, 2023 was $3.1 million and $3.1 million, respectively.

5. GOODWILL AND INTANGIBLE ASSETS

Goodwill

Goodwill is not amortized, but rather, is tested for impairment annually or more frequently if impairment indicators arise. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in each business combination.

The Company's annual testing for impairment of goodwill was completed as of April 30, 2023. To determine the fair value of the two reporting units as of April 30, 2023, the Company utilized the income approach for Med Tech and a combination of the income approach and market approach for Med Device. Based on the results of this evaluation, there were no adjustments to goodwill for either reporting unit as of April 30, 2023.

In the fourth quarter of fiscal year 2023, the Company concluded that the sale of the dialysis and BioSentry businesses to Merit Medical Systems, Inc. was a triggering event for the Med Device report unit. As the Company concluded that this was the sale of a business, goodwill was allocated to the sale based on the relative fair value of the dialysis and BioSentry businesses and is included in assets held for sale as of May 31, 2023. To determine the fair value of the remaining Med Device reporting unit as of May 31, 2023, the Company utilized the income approach, as it was determined to be a better representation of the remaining Med Device reporting unit's projected long-term performance. Based on the results of this evaluation, the Company recorded a goodwill impairment charge of $14.5 million for the year ended May 31, 2023 to write down the carrying value of the Med Device reporting unit to fair value.

Goodwill for each reporting unit is allocated as follows:


	Three months ended Aug 31, 2023
(in thousands)	Med Tech		Med Device		Total
Balance, June 1, 2023	$	159,238	$	—	$	159,238
Foreign currency translation adjustments	(221)		—		(221)




Balance, August 31, 2023	$	159,017	$	—	$	159,017

There were no adjustments to goodwill for the three months ended August 31, 2023 other than foreign currency translation adjustments.

Even though the Company determined that there was no goodwill impairment at August 31, 2023, the future occurrence of a potential indicator of impairment, such as a significant adverse change in legal, regulatory, business or economic conditions or a more-likely-than-not expectation that one of the reporting units or a significant portion of either of the reporting units will be sold or disposed of, would require an interim assessment for the reporting units prior to the next required annual assessment as of April 30, 2024.

Definite Lived Intangible Assets

Intangible assets other than goodwill are amortized over their estimated useful lives on a straight-line basis. Useful lives range from two to eighteen years. The Company periodically reviews, and adjusts, if necessary, the estimated useful lives of its intangible assets and reviews such assets or asset groups for impairment whenever events or changes in circumstances indicate

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that the carrying value of the assets or asset groups may not be recoverable. If an intangible asset or asset group is considered to be impaired, the amount of the impairment will equal the excess of the carrying value over the fair value of the asset.

Intangible assets consisted of the following:


	Aug 31, 2023
(in thousands)	Gross carrying value		Accumulated amortization		Net carrying value
Product technologies	$	210,589	$	(120,652)	$	89,937
Customer relationships	57,528		(41,714)		15,814
Trademarks	7,450		(6,689)		761
Licenses	4,837		(4,678)		159


	$	280,404	$	(173,733)	$	106,671


	May 31, 2023
(in thousands)	Gross carrying value		Accumulated amortization		Net carrying value
Product technologies	$	211,751	$	(118,314)	$	93,437
Customer relationships	57,509		(40,755)		16,754
Trademarks	7,450		(6,660)		790
Licenses	4,837		(4,674)		163


	$	281,547	$	(170,403)	$	111,144

Amortization expense for the three months ended August 31, 2023 and 2022 was $3.6 million and $4.8 million, respectively.

Expected future amortization expense related to the intangible assets for each of the following fiscal years is as follows:


(in thousands)
Remainder of 2024	$	10,727
2025	14,303
2026	14,122
2027	13,980
2028	10,749
2029 and thereafter	42,790
	$	106,671

6. ACCRUED LIABILITIES

Accrued liabilities consisted of the following:


(in thousands)	Aug 31, 2023		May 31, 2023
Payroll and related expenses	$	10,803	$	9,232
Outside services	5,593		7,088
Royalties	1,649		2,874
Research and development	1,847		1,525
Sales and franchise taxes	1,088		480
Accrued payroll taxes	484		441
Rebates	485		469
Accrued Freight	450		450
Deferred Warranties	492		475
Accrued severance	179		262
Other	3,009		3,321

SEC Form 10-Q filed by AngioDynamics Inc.