Haemonetics (HAE) Q1 2025 earnings summary

Executive summary

• First quarter FY25 revenue reached $336.2 million, up 8% year-over-year (3% organic), led by strong Hospital segment growth and recent acquisitions.

• Adjusted EPS was $1.02, down 2.9% year-over-year; GAAP EPS was $0.74, down 7.5%.

• Operating income declined 25.9% to $39.8 million, mainly due to higher costs from acquisitions.

• Integration of Attune Medical and OpSens, along with new product launches, expanded the Hospital business and drove growth.

• Issued $700 million in 2.5% convertible senior notes due 2029 to refinance debt and fund acquisitions.

Financial highlights

• Adjusted gross margin rose to 55.3% (up 110 bps YoY); GAAP gross margin was 52.0%, down from 53.7% last year.

• Adjusted operating income was $71 million (+1%), with adjusted operating margin at 21.1% (down 150 bps YoY, up 230 bps sequentially).

• Adjusted net income was $52.4 million, down 2.4% year-over-year.

• Free cash outflow of $17 million in Q1; cash on hand at quarter-end was $344.4 million, up $165.6 million since fiscal year-end.

• Operating expenses rose 19% to $135.2 million, reflecting higher R&D, SG&A, and amortization from acquisitions.

Outlook and guidance

• FY25 reported revenue growth expected at 5%-8%, organic growth flat to 3%; Hospital segment expected to grow 13%-16% organically.

• Adjusted operating margin guidance reaffirmed at 23%-24%; adjusted EPS guidance at $4.45-$4.75.

• Free cash flow guidance unchanged at $130-$180 million for FY25.

• Ongoing restructuring and portfolio rationalization initiatives to drive operational efficiencies.

• Management expects compliance with all debt covenants and sufficient liquidity for at least the next twelve months.