hae-20230701

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: July 1, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-14041

HAEMONETICS CORPORATION

(Exact name of registrant as specified in its charter)


Massachusetts		04-2882273
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

125 Summer Street
Boston,	Massachusetts	02110
(Address of principal executive offices)		(Zip Code)

(781) 848-7100

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of Each Exchange on Which Registered

Common stock, $.01 par value per share

HAE

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.) Yes ☐No x

The number of shares of $0.01 par value common stock outstanding as of August 4, 2023: 50,712,010

HAEMONETICS CORPORATION

INDEX



			PAGE
PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

Unaudited Condensed Consolidated Statements of Income and Comprehensive Income - Three Months Ende d July 1, 202 3 and July 2, 2022			3
Unaudited Condensed Consolidated Balance Sheet - July 1, 2023 and Consolidated Balance Sheet - April 1 , 202 3			4
Unaudited Condensed Consolidated Statements of Stockholders’ Equity - Three Months Ended July 1 , 202 3 and J uly 2 , 2022			5
Unaudited Condensed Consolidated Statements of Cash Flows - Three Months Ended July 1, 2023 and J uly 2 , 2022			6
Notes to Unaudited Condensed Consolidated Financial Statements			7

ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			20

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk			28

ITEM 4. Controls and Procedures			28

PART II. OTHER INFORMATION			29

ITEM 1. Legal Proceedings			29

ITEM 1A. Risk Factors			29

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds			29

ITEM 3. Defaults upon Senior Securities			29

ITEM 4. Mine Safety Disclosures			29

ITEM 5. Other Information			29

ITEM 6. Exhibits			30

SIGNATURES			31

Table of Contents

ITEM 1. FINANCIAL STATEMENTS

HAEMONETICS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited in thousands, except per share data)


	Three Months Ended
	July 1, 2023		July 2, 2022
Net revenues	$	311,332	$	261,458
Cost of goods sold	144,067		119,195
Gross profit	167,265		142,263
Operating expenses:
Research and development	12,648		10,902
Selling, general and administrative	93,485		92,227
Amortization of acquired intangible assets	7,473		8,367

Total operating expenses	113,606		111,496
Operating income	53,659		30,767
Interest and other expense, net	(2,069)		(5,273)
Income before provision for income taxes	51,590		25,494
Provision for income taxes	10,548		5,617
Net income	$	41,042	$	19,877

Net income per share - basic	$	0.81	$	0.39
Net income per share - diluted	$	0.80	$	0.38

Weighted average shares outstanding
Basic	50,542		51,224
Diluted	51,340		51,683

Comprehensive income	$	41,905	$	13,114

The accompanying notes are an integral part of these condensed consolidated financial statements.

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HAEMONETICS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited in thousands, except share data)


	July 1, 2023		April 1, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	285,719	$	284,466
Accounts receivable, less allowance for credit losses of $5,047 at July 1, 2023 and $4,932 at April 1, 2023	177,117		179,142
Inventories, net	289,207		259,379
Prepaid expenses and other current assets	49,564		46,735
Total current assets	801,607		769,722
Property, plant and equipment, net	304,467		310,885
Intangible assets, less accumulated amortization of $427,521 at July 1, 2023 and $417,422 at April 1, 2023	268,146		275,771
Goodwill	465,910		466,231
Deferred tax asset	4,875		5,241
Other long-term assets	117,253		106,975
Total assets	$	1,962,258	$	1,934,825
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Notes payable and current maturities of long-term debt	$	13,572	$	11,784
Accounts payable	78,134		63,929
Accrued payroll and related costs	32,970		64,475
Other current liabilities	112,263		111,628
Total current liabilities	236,939		251,816
Long-term debt, net of current maturities	751,381		754,102
Deferred tax liability	37,342		36,195
Other long-term liabilities	71,980		74,715
Stockholders’ equity:
Common stock, $0.01 par value; Authorized — 150,000,000 shares; Issued and outstanding — 50,705,779 shares at July 1, 2023 and 50,448,519 shares at April 1, 2023	507		504
Additional paid-in capital	609,610		594,706
Retained earnings	284,017		253,168
Accumulated other comprehensive loss	(29,518)		(30,381)
Total stockholders’ equity	864,616		817,997
Total liabilities and stockholders’ equity	$	1,962,258	$	1,934,825

The accompanying notes are an integral part of these condensed consolidated financial statements.

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HAEMONETICS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited in thousands)


	Common Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss)/Income		Total Stockholders’ Equity
	Shares	Par Value
Balance, April 1, 2023	50,449	$	504	$	594,706	$	253,168	$	(30,381)	$	817,997
Employee stock purchase plan	40	—		2,871		—		—		2,871
Exercise of stock options	145	2		5,858		(5,233)		—		627
Issuance of restricted stock, net of cancellations	140	2		(2)		—		—		—

Tax withholding on employee equity awards	(68)	(1)		(812)		(4,960)				(5,773)
Share-based compensation expense	—	—		6,989		—		—		6,989
Net income	—	—		—		41,042		—		41,042
Other comprehensive income	—	—		—		—		863		863
Balance, July 1, 2023	50,706	$	507	$	609,610	$	284,017	$	(29,518)	$	864,616


	Common Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss)/Income		Total Stockholders’ Equity
	Shares	Par Value
Balance, April 2, 2022	51,124	$	511	$	572,476	$	202,391	$	(25,954)	$	749,424
Employee stock purchase plan	57	—		2,459		—		—		2,459
Exercise of stock options	3	1		126		—		—		127
Issuance of restricted stock, net of cancellations	131	1		(1)		—		—		—


Share-based compensation expense	—	—		5,299		—		—		5,299
Net income	—	—		—		19,877		—		19,877
Other comprehensive loss	—	—		—		—		(6,763)		(6,763)
Balance, July 2, 2022	51,315	$	513	$	580,359	$	222,268	$	(32,717)	$	770,423

The accompanying notes are an integral part of these condensed consolidated financial statements.

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HAEMONETICS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited in thousands)


	Three Months Ended
	July 1, 2023		July 2, 2022
Cash Flows from Operating Activities:
Net income	$	41,042	$	19,877
Adjustments to reconcile net income to net cash provided by operating activities:
Non-cash items:
Depreciation and amortization	23,032		22,447


Share-based compensation expense	6,989		5,299
Amortization of deferred financing costs	830		797
Inventory reserve adjustment	(1,785)		(2,075)



Other non-cash operating activities	682		1,192
Change in operating assets and liabilities:
Change in accounts receivable	1,010		10,358
Change in inventories	(29,396)		15,240
Change in prepaid income taxes	1,595		2,118
Change in other assets and other liabilities	(9,986)		(6,079)
Change in accounts payable and accrued expenses	(14,927)		(27,181)
Net cash provided by operating activities	19,086		41,993
Cash Flows from Investing Activities:
Capital expenditures	(9,663)		(45,467)
Acquisition	—		(2,850)

Proceeds from sale of property, plant and equipment	402		498
Other investments	(6,000)		(10,395)
Net cash used in investing activities	(15,261)		(58,214)
Cash Flows from Financing Activities:





Repayment of term loan borrowings	(1,750)		(4,375)


Contingent consideration payments	(849)		(21,593)
Proceeds from employee stock purchase plan	2,871		2,459
Proceeds from exercise of stock options	627		127
Cash used to net share settle employee equity awards	(1,483)		—
Other financing activities	(14)		(13)
Net cash used in financing activities	(598)		(23,395)
Effect of exchange rates on cash and cash equivalents	(1,974)		(4,932)
Net Change in Cash and Cash Equivalents	1,253		(44,548)
Cash and Cash Equivalents at Beginning of Period	284,466		259,496
Cash and Cash Equivalents at End of Period	$	285,719	$	214,948
Supplemental Disclosures of Cash Flow Information:


Non-Cash Investing and Financing Activities:
Transfers from inventory to fixed assets for placement of Haemonetics equipment	$	1,982	$	38,022

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

HAEMONETICS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

SEC Form 10-Q filed by Haemonetics Corporation