Haemonetics Reports Balanced Earnings with Growth and Challenges

Haemonetics ((HAE)) has held its Q4 earnings call. Read on for the main highlights of the call.

The recent earnings call of Haemonetics Corporation presented a balanced sentiment, highlighting strong revenue growth in the hospital segment and significant margin expansion. However, the company also faced challenges, including a decline in Plasma revenue due to the CSL transition and ongoing issues in the Chinese market.

Strong Revenue Growth in Hospital Segment

The hospital segment of Haemonetics showed impressive growth, with revenue increasing by 12% in Q4 and 24% for the fiscal year 2025 on a reported basis. The organic growth figures were also notable, with 9% in Q4 and 12% for the fiscal year, underscoring the segment’s robust performance.

Impressive Margin Expansion

Haemonetics achieved significant margin expansion, with the adjusted gross margin increasing by 620 basis points in Q4 to reach 60.2%. For the fiscal year 2025, the margin improved by 300 basis points, culminating in a 57.4% margin, reflecting the company’s effective cost management strategies.

Significant Plasma Revenue Growth Ex-CSL

Excluding the impact of CSL, Haemonetics’ Plasma revenue demonstrated growth, with an 11% increase in Q4 and a 5% rise for fiscal 2025. This growth indicates the company’s ability to maintain momentum in its Plasma business despite external challenges.

Share Buyback Program

Haemonetics executed a substantial share buyback program, repurchasing approximately 2.4 million shares for $150 million. The company also announced a new $500 million share repurchase program, signaling confidence in its financial health and future prospects.

Enhanced Profitability and Earnings Growth

The company reported a significant increase in profitability, with fourth-quarter adjusted net income rising by 34% to $61.6 million. Adjusted earnings per diluted share also saw a substantial increase of 39%, reaching $1.24, highlighting strong earnings growth.

Plasma Revenue Decline Due to CSL Transition

Despite the overall growth in Plasma revenue, the segment faced a decline of 9% in Q4 and 6% for fiscal 2025 due to the planned transition with CSL. This transition posed a challenge to the company’s revenue stream in this area.

Decline in Blood Center Revenue

The Blood Center segment experienced a decline, with revenue dropping by 22% in Q4 and 8% for fiscal 2025. This decrease was attributed to the Whole Blood divestiture, impacting the segment’s overall performance.

Challenges in China’s Market

Haemonetics continued to face market challenges in China, affecting its performance in the Hemostasis Management segment. These challenges remain a concern for the company’s operations in the region.

Vascular Closure Challenges

The legacy VASCADE business within the Vascular Closure segment saw a decline, with VASCADE representing less than 15% of the segment’s revenue. This indicates ongoing challenges in maintaining growth in this area.

Forward-Looking Guidance

Haemonetics provided extensive guidance for fiscal year 2026, projecting total organic revenue growth of 6% to 9%, excluding CSL. The Hospital segment is expected to grow between 8% and 11%, with significant contributions from Interventional Technologies and Blood Management Technologies. Vascular Closure revenue is forecasted to grow double-digit, supported by growth in addressable access sites in electrophysiology in the U.S. Plasma revenue, excluding CSL, is anticipated to grow organically by 11% to 14%. The company also expects an improvement in the adjusted operating margin by 200 to 300 basis points, reaching 26% to 27%, with adjusted earnings per diluted share projected to be between $4.70 and $5.

In summary, Haemonetics Corporation’s earnings call reflected a balanced outlook, with strong growth in the hospital segment and margin expansion, despite facing challenges in Plasma revenue and the Chinese market. The company’s forward-looking guidance remains optimistic, with expectations of continued growth and profitability improvements.