HAEMONETICS CORPORATION 
By BRAINTREE, Mass.,
Third quarter fiscal 2008 adjusted net income, excluding charges in both
fiscal 2007 and 2008 and certain tax benefits in 2007, was
"We are making good strides on our strategic vision to be the global
leader in blood management solutions for our customers. Haemonetics is
providing customers with a value proposition that includes an extensive depth
and breadth of products, services, and software across the blood bank and
hospital markets,"
The Company has attached a reconciliation of GAAP to adjusted results at the end of this release. A copy of the reconciliation is also posted on the web at http://www.haemonetics.com/investors.
FINANCIALS
In addition to revenues and earnings per share, Haemonetics reported third
quarter gross profit of
Adjusted (1,2) operating expenses for the quarter were
Haemonetics' tax rate was 31.0% in the quarter and 31.7% year-to-date. In the quarter, Haemonetics benefited from resolution of certain tax contingencies.
Haemonetics ended the quarter with a cash balance of
EXPANDING THE BUSINESS
Haemonetics continues to make progress expanding the business. The Company reported the following highlights:
-- Ongoing restructuring of the European business, which reported 26.5%
revenue growth
-- Acquisition of the TEG(R) Thrombelastograph(R) Hemostasis Analyzer
business which is expected to add approximately $16 million in annual
revenues
-- Launch of a module for the Symphony software suite that allows blood
bank customers to automate applications in their manufacturing and
distribution operations
-- OrthoPAT(R) orthopedic perioperative autotransfusion system disposable
unit growth of nearly 20%
QUARTERLY PRODUCT LINE GROWTH
Among the product line growth drivers, plasma disposables revenue was
Blood bank disposables revenue was
Red cell disposables revenue was
Software and services revenue grew to
OrthoPAT disposables revenue was
Equipment revenue was
FY08 GUIDANCE
Haemonetics raised its FY08 revenue growth guidance from 10-12% growth to
11-13% growth, narrowed its expected gross profit to a range of
Adjusted FY08 guidance excludes approximately $4-5 million, or
approximately
FY08 GAAP earnings per share guidance is
For the full year, the Company expects to generate
Haemonetics has posted potential income scenarios reflecting guidance ranges on its website at www.haemonetics.com.
CONFERENCE CALL
Haemonetics will hold a conference call on
Haemonetics (NYSE: HAE) is a global healthcare company dedicated to providing innovative blood management solutions for our customers. Together, our devices and consumables, IT products, and consulting services deliver a suite of business solutions to help our customers improve clinical outcomes and reduce the cost of healthcare for blood collectors, hospitals, and patients around the world. Our technologies address important medical markets: blood and plasma component collection, the surgical suite, and hospital transfusion services. To learn more about Haemonetics, visit our web site at http://www.haemonetics.com.
As part of this release, Haemonetics has presented supplemental non-GAAP financial results which exclude restructuring costs and an in-process research and development charge. Haemonetics believes that these non-GAAP results are useful to investors because it allows for an evaluation of the Company with a focus on the results of our core business.
This release contains forward-looking statements that involve risks and
uncertainties, including technological advances in the medical field and
standards for transfusion medicine and our ability to successfully implement
products that incorporate such advances and standards, product demand, market
acceptance, regulatory uncertainties, the effect of economic and political
conditions, the impact of competitive products and pricing, blood product
reimbursement policies and practices, foreign currency exchange rates, changes
in customers' ordering patterns, the effect of industry consolidation as seen
in the plasma market, the effect of communicable diseases and the effect of
uncertainties in markets outside the U.S. (including
CONTACT:
Julie Fallon
Tel. (781) 356-9517
Alternate Tel.(617) 320-2401
fallon@haemonetics.com
HAEMONETICS CORPORATION FINANCIAL SUMMARY
(UNAUDITED DATA IN THOUSANDS, EXCEPT PER SHARE DATA)
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THIRD QUARTER FYE08
% Inc/(Dec)
12/29/07 As 12/30/06 As vs Prior
Reported Reported Year
NET REVENUES $134,587 $113,527 18.6%
Gross profit 66,558 56,419 18.0
R&D 5,529 5,804 (4.7)
S,G&A 41,432 33,610 23.3
Operating expenses 46,961 39,414 19.1
Operating income 19,597 17,005 15.2
Interest income, net 1,070 1,583 (32.8)
Other income/(expense), net 225 816 (72.4)
Income before taxes 20,892 19,404 7.7
Tax expense 6,538 2,503 161.2
NET INCOME $14,354 $16,902 (15.1%)
Net income per common share
assuming dilution $0.54 $0.62 (12.1%)
Weighted average number of shares
Basic 25,500 26,527
Diluted 26,437 27,367
Inc/(Dec) vs
prior year
profit
Profit Margins: margin %
Gross profit 49.5% 49.7% (0.2%)
R&D 4.1% 5.1% (1.0%)
S,G&A 30.8% 29.6% 1.2%
Operating income 14.6% 15.0% (0.4%)
Income before taxes 15.5% 17.1% (1.6%)
Net income 10.7% 14.9% (4.2%)
CONSOLIDATED STATEMENTS OF INCOME FOR FYE08 YEAR TO DATE
% Inc/(Dec)
12/29/07 As 12/30/06 As vs Prior
Reported Reported Year
NET REVENUES $377,701 $332,688 13.5%
Gross profit 187,940 168,953 11.2
R&D 18,532 17,570 5.5
S,G&A 119,418 105,258 13.5
In-Process R&D 0 9,073 (100.0)
Operating expenses 137,950 131,901 4.6
Operating income 49,990 37,052 34.9
Interest income, net 4,037 4,715 (14.4)
Other income/(expense), net 1,905 2,153 (11.5)
Income before taxes 55,932 43,920 27.3
Tax expense 17,733 14,595 21.5
NET INCOME 38,199 29,324 30.3%
Net income per common share
assuming dilution $1.43 $1.06 35.0%
Weighted average number of shares
Basic 25,881 26,838
Diluted 26,776 27,754
Inc/(Dec) vs
prior year
profit
Profit Margins: margin %
Gross profit 49.8% 50.8% (1.0%)
R&D 4.9% 5.3% (0.4%)
S,G&A 31.6% 31.6% 0.0%
Operating income 13.2% 11.1% 2.1%
Income before taxes 14.8% 13.2% 1.6%
Net income 10.1% 8.8% 1.3%
REVENUE ANALYSIS
Third Quarter Nine Months Ended
12/29/07 12/30/06 12/29/07 12/30/06
As As % Inc/ As As % Inc/
Reported Reported (Dec) Reported Reported (Dec)
Revenues by
Geography
United States $61,481 $49,819 23.4% $170,085 $143,050 18.9%
International 73,106 63,708 14.8 207,616 189,638 9.5
Net Revenues $134,587 $113,527 18.6 $377,701 $332,688 13.5%
Donor
Plasma $41,253 $32,362 27.5% $114,789 $96,253 19.3%
Blood Bank 33,207 30,954 7.3 100,399 93,998 6.8
Red Cell 12,478 11,132 12.1 34,257 32,105 6.7
$86,938 $74,448 16.8 $249,445 $222,356 12.2
Patient
Surgical 18,981 16,989 11.7 50,907 49,298 3.3
OrthoPAT 9,086 7,491 21.3 25,122 22,132 13.5
$28,067 $24,480 14.7 $76,029 $71,430 6.4
Subtotal $115,005 $98,928 16.3 $325,474 $293,786 10.8
Equipment $8,485 $5,194 63.4 $22,286 $15,207 46.6
Software & Services 11,097 9,405 18.0 29,941 23,695 26.4
Net Revenues $134,587 $113,527 18.6% $377,701 $332,688 13.5%
CONSOLIDATED BALANCE SHEETS
Period ending
12/29/07 03/31/07
Assets
Cash & cash equivalents $116,857 $229,227
Accounts receivable, net $108,811 $91,832
Inventories, net $63,847 $61,797
Other current assets $37,741 $20,815
Total current assets $327,256 $403,671
Net PP&E $110,439 $90,775
Other assets $127,837 $78,289
Total assets $565,532 $572,735
Period ending
12/29/07 03/31/07
Liabilities & Stockholders' Equity
S/T debt & current maturities $6,206 $22,201
Other current liabilities 74,176 $59,816
Total current liabilities 80,382 82,017
Long-term debt 6,202 6,675
Other long-term liabilities 5,248 4,395
Stockholders' equity 473,700 479,648
Total liabilities & equity $565,532 $572,735
THIRD QUARTER FYE08
CONSOLIDATED STATEMENTS OF INCOME ADJUSTED FOR CERTAIN
ITEMS
12/29/07
Restructuring
12/29/07 As Costs 12/29/07 As
Reported (3) Adjusted (4)
NET REVENUES $134,587 $0 $134,587
Gross profit 66,558 0 66,558
R&D 5,529 0 5,529
S,G&A 41,432 1,225 40,207
Operating expenses 46,961 1,225 45,736
Operating income 19,597 (1,225) 20,822
Interest income, net 1,070 0 1,070
Other income/(expense), net 225 0 225
Income before taxes 20,892 (1,225) 22,117
Tax expense 6,538 (386) 6,924
NET INCOME $14,354 ($839) $15,193
Net income per common share
assuming dilution $0.54 ($0.03) $0.57
Weighted average number of shares
Basic 25,500 25,500 25,500
Diluted 26,437 26,437 26,437
Profit Margins:
Gross profit 49.5% 49.5%
R&D 4.1% 4.1%
S,G&A 30.8% 29.9%
Operating income 14.6% 15.5%
Income before taxes 15.5% 16.4%
Net income 10.7% 11.3%
12/30/06
Resolution
of Tax Restruc- 12/30/06 Adjusted
12/30/06 Contin- turing As %
As gencies Costs adjusted Inc/(Dec)
Reported (5) (3) (7) '08 vs '07
NET REVENUES $113,527 $0 $0 $113,527 18.6%
Gross profit 56,419 0 0 56,419 18.0
R&D 5,804 0 0 5,804 (4.7)
S,G&A 33,610 0 265 33,345 20.6
Operating expenses 39,414 0 265 39,149 16.8
Operating income 17,005 0 (265) 17,270 20.6
Interest income, net 1,583 0 0 1,583 (32.4)
Other income/(expense),
net 816 0 0 816 (72.4)
Income before taxes 19,404 0 (265) 19,669 12.4
Tax expense 2,503 (3,568) (88) 6,159 12.4
NET INCOME $16,901 $3,568 ($177) $13,510 12.5
Net income per common share
assuming dilution $0.62 $0.13 ($0.01) $0.49 16.4%
Weighted average number of
shares
Basic 26,527 26,527 26,527 26,527
Diluted 27,367 27,367 27,367 27,367
Profit Margins: Inc/(Dec)
vs prior
year
profit
margin %
Gross profit 49.7% 49.7% (0.2%)
R&D 5.1% 5.1% (1.0%)
S,G&A 29.6% 29.4% 0.5%
Operating income 15.0% 15.2% 0.3%
Income before taxes 17.1% 17.3% (0.9%)
Net income 14.9% 11.9% (0.6%)
FYE08 YEAR TO DATE
CONSOLIDATED STATEMENTS OF INCOME ADJUSTED FOR CERTAIN ITEMS
12/29/07
Restructuring
12/29/07 As Costs 12/29/07 As
Reported (3) Adjusted (4)
NET REVENUES $377,701 $0 $377,701
Gross profit 187,940 0 187,940
R&D 18,532 0 18,532
S,G&A 119,418 4,009 115,409
In-Process R&D 0 0 0
Operating expenses 137,950 4,009 133,941
Operating income 49,990 (4,009) 53,999
Interest income, net 4,037 0 4,037
Other income/(expense), net 1,905 0 1,905
Income before taxes 55,932 (4,009) 59,941
Tax expense 17,733 (1,341) 19,074
NET INCOME 38,199 (2,668) $40,867
Net income per common share
assuming dilution $1.43 ($0.10) $1.53
Weighted average number of shares
Basic 25,881 25,881 25,881
Diluted 26,776 26,776 26,776
Profit Margins:
Gross profit 49.8% 49.8%
R&D 4.9% 4.9%
S,G&A 31.6% 30.6%
Operating income 13.2% 14.3%
Income before taxes 14.8% 15.9%
Net income 10.1% 10.8%
12/30/06
Resolution Restruc- 12/30/06
12/30/06 of Tax turing As
As Contingen- Arryx Costs Adjusted
Reported cies (5) IPRD (6) (3) (7)
NET REVENUES $332,688 $0 $0 $0 $332,688
Gross profit 168,953 0 0 0 168,953
R&D 17,570 0 0 0 17,570
S,G&A 105,258 0 0 2,932 102,326
In-Process R&D 9,073 0 9,073 0 0
Operating expenses 131,901 0 9,073 2,932 119,896
Operating income 37,052 0 (9,073) (2,932) 49,057
Interest income, net 4,715 0 0 0 4,715
Other income/(expense),
net 2,153 0 0 0 2,153
Income before taxes 43,920 0 (9,073) (2,932) 55,925
Tax expense 14,595 (3,568) 0 (1,004) 19,167
NET INCOME $29,325($3,568) ($9,073) (1,928) $36,758
Net income per common share
assuming dilution $1.06 ($0.13) ($0.33) ($0.07) $1.32
Weighted average number of
shares
Basic 26,838 25,881 26,838 26,838 26,838
Diluted 27,754 26,776 27,754 27,754 27,754
Profit Margins:
Gross profit 50.8% 50.8%
R&D 5.3% 5.3%
S,G&A 31.6% 30.8%
Operating income 11.1% 14.7%
Income before taxes 13.2% 16.8%
Net income 8.8% 11.0%
Adjusted % Inc/(Dec)
'08 vs. '07
NET REVENUES 13.5%
Gross profit 11.2
R&D 5.5
S,G&A 12.8
In-Process R&D ---
Operating expenses 11.7
Operating income 10.1
Interest income, net (14.4)
Other income/(expense), net (11.5)
Income before taxes 7.2
Tax expense (0.5)
NET INCOME 11.2
Net income per common share
assuming dilution 15.3%
Weighted average number of shares
Basic
Diluted
Profit Margins: Inc/(Dec) vs. prior
year profit
margin %
Gross profit (1.0%)
R&D (0.4%)
S,G&A (0.2%)
Operating income (0.4%)
Income before taxes (0.9%)
Net income (0.2%)
FREE CASH FLOW RECONCILIATION
Three Months Ended Nine Months Ended
12-29-07 12-30-06 12-29-07 12-30-06
GAAP CASH FLOW FROM OPERATIONS $24,876 $25,968 $45,754 $59,467
Capital expenditures ($15,242) ($9,695) ($42,497) ($26,985)
Proceeds from sale of property,
plant and equipment $1,187 $834 $3,149 $2,588
Net investment in property, plant
and equipment ($14,055) ($8,861) ($39,348) ($24,397)
Free Cash Flow $10,821 $17,107 $6,406 $35,070
(1) Haemonetics' Q3FY08 adjusted financial results exclude restructuring
costs in connection with changes to the Company's international
operations resulting in (pre-tax) charges of $1.2 million, or $0.03
per share. Q3FY07 adjusted financial results to which the Company is
comparing also exclude restructuring charges of $0.3 million (pre-
tax), or $0.01 per share and a favorable resolution of tax
contingencies resulting in a $3.6 million tax credit ($0.13 per share
impact).
(2) FY08 year-to-date adjusted financial results exclude restructuring
costs resulting in (pre-tax) charges of $4.0 million, or $0.10 per
share. FY07 year-to-date financial results to which the Company is
comparing exclude restructuring charges of $2.9 million (pre-tax), or
$0.07 per share, an in-process R&D charge related to the acquisition
of Arryx of $9 million (pre-tax), or $0.33 per share, and the
favorable resolution of the tax contingencies resulting in a $3.6
million tax credit ($0.13 per share impact).
(3) Restructuring costs primarily include severance and related costs
associated with eliminating or reorganizing certain positions in our
international business operations.
(4) "As Adjusted" for FY 08 is comprised of "As Reported" less the
"Restructuring Costs".
(5) Income tax expense was reduced during the quarter due to the
finalization of an audit of prior year income tax returns.
(6) IPRD impact of Arryx acquisition.
(7) "As Adjusted" for FY 07 is comprised of "As Reported" less the
"Restructuring Costs," "In-process R&D," and the "Resolution of the
Tax Contingency".
SOURCE Haemonetics Corporation
