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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) July 29, 2004
HAEMONETICS CORPORATION
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(Exact name of registrant as specified in its charter)
Massachusetts 1-10730 04-2882273
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(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
400 Wood Road Braintree, MA 02184
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (781) 848-7100
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(Former name or former address if changed since last report)
Item. 7 FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99.1: Press Release of Haemonetics Corporation dated July 29, 2004
Item. 12 RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On July 29, 2004, Haemonetics Corporation (the "Company") issued a
press release announcing financial results for the first quarter
ended July 3, 2004. A copy of the release is furnished with this
report as exhibit 99.1.
The information in this current report on Form 8-K and the exhibit
attached hereto shall not be deemed "filed" for the purposes of
Section 18 of the Securities and Exchange Act of 1934 (the "Exchange
Act") or otherwise subject to the liabilities of that section, nor
shall it be deemed incorporated by reference in any filing under the
Securities Act of 1933 or the Exchange Act, regardless of any
general incorporation language in such filing.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
(Registrant)
Date: July 29, 2004 By: /s/ Ronald J. Ryan
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Ronald J. Ryan, Vice President and Chief
Financial Officer
2
EXHIBIT INDEX
Exhibit No. Subject Matter
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99.1 Press Release of Haemonetics Corporation
dated July 29, 2004.
3
Exhibit 99.1
Haemonetics Reports First Quarter Results
Affirms Full Year Guidance
BRAINTREE, Mass., July 29 /PRNewswire-FirstCall/ -- Haemonetics
Corporation reported today first quarter 2005 net revenue of $95 million, a 7%
increase over first quarter fiscal 2004. Diluted net earnings per share were
$0.38, up 81% over Q1:04. The Company also affirmed its full fiscal 2005
guidance of mid-single digit revenue growth, gross profit margins in the high
40% range, operating income growing more than 20%, improved operating margin,
and net earnings per share in the range of $1.38 to $1.43.
FINANCIAL HIGHLIGHTS
Haemonetics reported the following financial results for the quarter:
-- Net revenue of $95 million, up 7% from $88 million in Q1:04
-- Gross profit of $47 million, up 19% from $40 million in Q1:04
-- Gross margin of 50%, up from 45% in Q1:04
-- Operating expenses of $32 million, up 2% from $31 million in Q1:04
-- Operating income of $15 million, up 83% from $8 million Q1:04
-- Operating margin of 16%, up from 9% in Q1:04
-- Net earnings per share of $0.38, up 81% from $0.21 in Q1:04
Several factors affected the Company's financial results in the quarter.
There was a $4 million negative impact to revenue due to consolidation in the
plasma market. Currency affected results favorably. There was also a $600
thousand income tax benefit in the quarter in Japan that is reflected in this
quarter's 32% income tax rate. The Company projects the tax rate to be 36% for
the balance of the year.
Haemonetics will post a non-GAAP financial reconciliation on its website
prior to its conference call.
Haemonetics maintained a strong balance sheet, highlighted by a cash
increase of $12 million to an ending cash balance of $130 million. The
Company achieved $9.5 million of cash flow from operating activities for the
quarter.
Brad Nutter, Haemonetics' President and CEO, said, "It was a challenge to
produce these strong results in light of the loss in revenue versus last year
in the plasma market. We did this by continuing to grow in all other product
lines. At the same time, our bottom line improved because we managed costs
and expenses well."
DONOR PRODUCT LINE HIGHLIGHTS
Plasma disposables revenue was $25 million for the quarter, down 14% over
Q1:04.
Blood bank disposables revenue was $31 million, up 19% over Q1:04.
Platelet disposables represent the majority of the blood bank product line,
and about 80% of platelet disposables revenues are in Europe and Japan. These
regions continued to perform well and experienced favorable impact from
currency.
Red cell disposables revenue was $6 million, up 42% over Q1:04. This
product is predominantly sold in the U.S. where blood shortages are more
frequent.
In the quarter, Haemonetics renegotiated and extended its agreement with
the American Red Cross. The Red Cross launched its national double red cell
donation program in 2002 and has now implemented a significant number of
collection devices across 19 of its 35 regions to support its efforts to
increase supply of type O and B red cells.
PATIENT PRODUCT LINE HIGHLIGHTS
Cell Saver(R) brand disposables revenue was $16 million, up 4% over Q1:04
despite a decline in open heart surgeries.
OrthoPAT(R) brand disposables revenue was $4 million, up 71% over Q1:04.
The OrthoPAT brand has gained momentum, posting growth over 30% for five
consecutive quarters.
SUMMARY OF RECENT ANNOUNCEMENTS
In the quarter, Haemonetics reported on several activities in support of
its strategy to leverage its core business to improve growth and
profitability.
In April, the Company's stand-alone bacterial detection blood sampling
system was cleared for use in the U.S. Bacterial detection of platelets was
mandated by the American Association of Blood Banks in March 2004. Therefore,
Haemonetics' technology supports blood center customers' regulatory needs.
In June, the Company announced it had extended for three years its
exclusive marketing agreement in Japan with Arizant Inc. for Arizant's Bair
Hugger(R) patient warming system. Additionally, Haemonetics will market
Arizant's Ranger(R) product line, a blood fluid warming system, in Japan once
the system clears the Japanese regulatory process.
Also in June, Haemonetics received U.S. regulatory clearance for its high-
separation ("HS") core bowl, a proprietary plasma collection bowl that removes
white blood cells from plasma without the need for an attached filtration
device. The system meets customers' needs and gives them a significant
improvement in plasma quality and ease of collection.
Finally, early in the second quarter, Haemonetics announced that it will
exclusively market Crit-Scan(R) to blood and plasma collectors globally.
Crit-Scan is manufactured by Hema Metrics Inc. and is the first non-invasive
device to measure hematocrit in blood without a painful needle stick to the
finger or ear.
"We will continue to leverage our strong market share and brand name to
grow our business. We are confident that we can achieve continued growth and
profitability to meet full year guidance," Mr. Nutter said.
CONFERENCE CALL DETAILS
Haemonetics will hold a conference call on Thursday, July 29th at 10:00 am
eastern to review financial and operational highlights. Interested parties
can participate by calling (800) 921-9431 (US only) or (973) 935-8505. The
call will be replayed through August 12th at (877) 519-4471 (US only) or
(973) 341-3080 using PIN 4938383.
Haemonetics (NYSE: HAE) is a global company engaged in the design,
manufacture and worldwide marketing of automated blood processing systems.
These systems address important medical markets: surgical blood salvage, blood
component collection, plasma collection, and blood component safety. To learn
more about Haemonetics' products and markets, visit its web site at
http://www.haemonetics.com.
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 Europe and Asia) in which
we operate and other risks detailed in the Company's filings with the
Securities and Exchange Commission. The foregoing list should not be
construed as exhaustive. The forward-looking statements are based on
estimates and assumptions made by management of the Company and are believed
to be reasonable, though are inherently uncertain and difficult to predict.
Actual results and experience could differ materially from the forward-looking
statements.
Cell Saver and OrthoPAT are registered trademarks of Haemonetics
Corporation. Bair Hugger and Ranger are registered trademarks of Arizant Inc.
Crit-Scan is a registered trademark of Hema Metrics Corp.
Haemonetics Corporation Financial Summary for the First Quarter FYE05
(Unaudited data in thousands, except per share data)
CONSOLIDATED INCOME STATEMENT % Inc/(Dec)
vs prior
7/3/04 6/28/03 year
NET REVENUES $94,602 $88,283 7.2
Gross profit 47,100 39,586 19.0
R&D 4,054 4,997 (18.9)
S, G & A 28,084 26,403 6.4
Operating expenses 32,138 31,400 2.4
Operating income 14,962 8,186 82.8
Interest expense (661) (786) (15.9)
Interest income 363 283 28.3
Other income (expense), net (232) 103 (325.2)
Income before taxes 14,432 7,786 85.4
Tax expense 4,612 2,803 64.5
NET INCOME $9,820 $4,983 97.1
Net income per common share
assuming dilution $0.38 $0.21 81.0
Weighted average number of shares
Basic 25,155 24,063
Diluted 25,579 24,223
PROFIT MARGINS
Gross profit 49.8% 44.8%
R&D 4.2% 5.6%
S, G & A 29.7% 29.9%
Operating income 15.8% 9.3% 6.5
Income before taxes 15.3% 8.8% 6.5
Net income 10.4% 5.6%
REVENUE ANALYSIS
%
7/3/04 6/28/03 Inc/(Dec)
Revenues by Geography
United States $32,907 $31,552 4.3
International 61,695 56,731 8.8
Net Revenues $94,602 $88,283 7.2
Disposable Revenues by Product Family
Donor:
Plasma 25,486 29,589 (13.9)
Blood Bank 30,769 25,949 18.6
Red Cell 6,461 4,564 41.6
62,716 60,102 4.3
Patient:
Surgical $20,773 $18,293 13.6
Subtotal $83,489 $78,395 6.5
Equipment 6,673 4,486 48.8
Misc & Service 4,440 5,402 (17.8)
Net Revenues $94,602 $88,283 7.2
Period ending
BALANCE SHEET: 7/3/04 4/3/04
Assets
Cash & cash equivalents $130,356 $118,117
Accounts receivable, net 84,046 82,640
Inventories, net 52,589 52,235
Other current assets 28,676 28,457
Total current assets 295,667 281,449
Net PP&E 73,810 78,030
Other assets 46,906 47,915
Total assets $416,383 $407,394
Period ending
7/3/04 4/3/04
Liabilities & Stockholders' Equity
S/T debt & current maturities $30,647 $32,818
Other current liabilities 59,581 63,025
Total current liabilities 90,228 95,843
Deferred tax liability, net 1,592 1,682
Long-term debt 25,322 25,442
Other long-term liabilities 4,609 4,678
Stockholders' equity 294,632 279,749
Total liabilities & equity $416,383 $407,394
Contact:
Julie Fallon
Tel. (781) 356-9517
Alternate Tel. (617) 320-2401
fallon@haemonetics.com
SOURCE Haemonetics Corporation
-0- 07/29/2004
/CONTACT: Julie Fallon of Haemonetics Corporation, +1-781-356-9517,
fallon@haemonetics.com/
/Web site: http://www.haemonetics.com/
(HAE)
CO: Haemonetics Corporation
ST: Massachusetts
IN: MTC BIO
SU: ERN CCA MAV