Haemonetics (HAE) Q1 Earnings Top Estimates, 2024 View Up
Haemonetics Corporation HAE delivered adjusted earnings per share (EPS) of $1.05 in the first quarter of fiscal 2024, up 81% year over year. The bottom line surpassed the Zacks Consensus Estimate by 38.2%.
On a GAAP basis, the EPS was 80 cents compared with 38 cents in the prior-year quarter.
Total Revenues
Revenues increased 19.1% (up 20.5% on an organic basis) to $311.3 million in the first quarter of fiscal 2024. The top line beat the Zacks Consensus Estimate by 4.5%. The uptick was driven by growth across all segments.
Segments in Detail
At Plasma, revenues of $138.6 million (accounting for 44.5% of the total revenues) rose 35.4% year over year (up 35.5% on an organic basis) in the reported quarter. This compares with our model projection of $110.7 million for the quarter reported.
Revenues at Blood Center (22.6%) rose 2.5% (up 5.8% on an organic basis) to $67.3 million. This compares with our model projection of $57 million for the fiscal first quarter.
Hospital revenues (31.9%) rose 12.6% (up 13.8% on an organic basis) to $99.6 million. It was primarily driven by growth in Vascular Closure and Hemostasis Management. This compares with our model projection of $120.2 million for the said quarter.
Haemonetics Corporation Price, Consensus and EPS Surprise
Haemonetics Corporation price-consensus-eps-surprise-chart | Haemonetics Corporation Quote
Service revenues (1.9%) increased 18.1% (up 19.3% on an organic basis) to $5.8 million. This compares with our model projection of $5.9 million for the fiscal first quarter.
Margins
In the first quarter of fiscal 2024, the company-adjusted gross margin was 54.2%, down 100 basis points (bps) year over year. The primary drivers of the decline in gross margin percentage were inventory reserves, investments in operations and increased depreciation expenses, partially offset by geographic and product mix, volume and price.
Company-adjusted operating expenses in the first quarter of fiscal 2024 were 31% compared with 38.1% from the year-ago quarter. The downside in adjusted operating expenses, as a percentage of revenues, was driven by operating leverage. Continuous growth investments partially offset this.
The company-adjusted operating income was $70.2 million in the quarter under discussion, up 56.5% year over year. The adjusted operating margin was 22.6%, up 540 bps from the year-ago quarter.
Financial Position
Haemonetics exited the fiscal first quarter with cash and cash equivalents of $285.7 million compared with $284.5 million at the end of the fourth quarter of fiscal 2023. The long-term debt at the end of the fiscal first quarter was $751.4 million, up from $754.1 million at the end of the fourth quarter of 2023.
The cumulative net cash flow from operating activities at the end of the first quarter of fiscal 2024 was $19.1 million compared to the $41.9 million cash inflow from operating activities a year ago.
2024 Guidance
Haemonetics updated its outlook for fiscal 2024.
For 2024, the company expects total GAAP revenue growth in the range of 6%-9% on a reported basis (earlier guided range was 4%-7%). Organic revenue growth is anticipated at 7%-10% (earlier guided range was 5%-8%). The Zacks Consensus Estimate for fiscal 2024 revenues is pegged at $1.25 billion.
HAE expects the full-year adjusted EPS in the band of $3.60-$3.90 ($3.45-$3.75). The Zacks Consensus Estimate for the same is pegged at $3.58.
Our Take
Haemonetics ended the first quarter of fiscal 2024 with better-than-expected earnings and revenues. The robust volume growth and price benefits in the Plasma business were driven by strong momentum in U.S. collections and price.
Within the Hospital business, North America performance was solid, supported by improved procedure volume and staffing levels at U.S. hospitals. The company’s international expansion is on track, and this quarter, HAE received approval for VASCADE MVP Japan and initiated clinical use of Vascular Closure products in key accounts in Germany and Italy. Blood Center revenue growth was driven by strong collections, particularly in Plasma coupled with favorable order timing among distributors. Further, the raised 2024 outlook instills optimism on the stock.
However, the uncertain economic scenario continues to pose a challenge for Haemonetics. The stiff competition remains a concern.
Zacks Rank & Key Picks
Haemonetics currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader medical space that have announced quarterly results are Penumbra, Inc. PEN, Integer Holdings Corporation ITGR and Intuitive Surgical, Inc. ISRG.
Penumbra, carrying a Zacks Rank of 1 (Strong Buy), reported second-quarter 2023 adjusted EPS of 43 cents, beating the Zacks Consensus Estimate by 53.6%. Revenues of $261.5 million outpaced the consensus mark by 3.3%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Penumbra has a 2024 estimated growth rate of 57.9%. PEN’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 94.2%.
Integer Holdings reported second-quarter 2023 adjusted EPS of $1.14, beating the Zacks Consensus Estimate by 15.2%. Revenues of $400 million surpassed the Zacks Consensus Estimate by 8.9%. It currently carries a Zacks Rank #2.
Integer Holdings has a long-term estimated growth rate of 12.1%. ITGR’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 8.4%.
Intuitive Surgical reported second-quarter 2023 adjusted EPS of $1.42, beating the Zacks Consensus Estimate by 7.6%. Revenues of $1.76 billion surpassed the Zacks Consensus Estimate by 1.4%. It currently carries a Zacks Rank #2.
Intuitive Surgical has a long-term estimated growth rate of 14.5%. ISRG’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 4.2%.
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