Avanos Medical (AVNS) Q4 2024 earnings summary

Executive summary

• Achieved strong Q4 and full-year performance, led by Enteral Feeding growth and completion of the respiratory health business divestiture, serving over two million patients in 2024.

• Exited deferred prosecution agreement with DOJ in January 2025.

• Reported a net loss for 2024 due to a $437M non-cash impairment charge, despite adjusted EPS growth.

Financial highlights

• Q4 2024 sales from continuing operations were $180M, up 5% year-over-year; full-year sales reached $688M, up 3.3%.

• Q4 adjusted diluted EPS was $0.43; full-year adjusted EPS was $1.35, up 31% year-over-year.

• Q4 adjusted EBITDA was $32M; full-year adjusted EBITDA was $108M.

• Q4 adjusted gross margin was 58.7%; full-year adjusted gross margin was 59%.

• Free cash flow for 2024 was $83M, up from $14.6M in 2023; normalized free cash flow ~$65M.

Outlook and guidance

• 2025 net sales expected between $665M and $685M; adjusted diluted EPS guidance is $1.05 to $1.25, assuming a 27% effective tax rate and 100 bps currency headwind.

• Management anticipates a pause in margin improvements in 2025 due to market and currency headwinds, with expansion targeted for 2026.

• Specialty Nutrition Systems segment projected to grow mid-single digits organically; Pain Management and Recovery segment to deliver flat to low single-digit organic growth.

• Corporate and Other segment anticipated to decline over 20%.

• Free cash flow in 2025 expected to be similar to 2024, excluding a one-time tax receivable.