Haemonetics sees shares rise on Q1 release

Haemonetics (NYSE:HAE) has seen shares rise despite releasing 1st quarter earnings that saw losses grow and earnings per share shrink compared to last year.

The Braintree, Mass.-based company reported losses of $10.3 million, or 20¢ per share, on sales of $210 million for the 3 months ended July 2.

The company saw bottom-line losses grow from $267,000 to over $10 million while overall sales shrunk 1.6% compared with the same period last year. After adjusting for 1-time items, net income was at $12.9 million with earnings per share ringing in at 25¢.

Shares have risen in response to the earnings release, up 6.6% to trade at $32.32 as of 12:35 p.m. EDT.

“Our 1st quarter revenue represents a reasonable start to fiscal 2017. However, our profitability was negatively impacted by the leukoreduction filter recall, which added $3.4 million of expense in the quarter. The implementation of our strategic plan began in the quarter, with tough measures designed to reposition our organization and cost structure. We have opportunities to increase the value of our company by advancing product innovation, focusing on our growth franchises and driving productivity. We implemented the first phase of cost reductions and realized $7 million of savings in the 1st quarter, and we are on track to achieve our targeted $40 million of savings in fiscal 2017. We are restructuring our operating model, streamlining our organization and reallocating resources to invest in profitable growth,” CEO Christopher Simon said in prepared remarks.

The company affirmed its previous 2017 fiscal guidance, expecting to see total revenue between $850 million and $875 million. GAAP earnings per share are expected to be between 70¢ and 80¢ with non-GAAP adjusted earnings per share at between $1.40 and $1.50.

In May, Haemonetics revealed plans to take a pre-tax charge of $26 million, including $17 million worth of “termination benefits,” as part of another round of layoffs aimed at boosting profitability and growth.

The Braintree, Mass.-based blood management company also said it named Chris Simon to be its new CEO, replacing interim chief Ron Gelbman, who took the reins after the September 2015 departure of Brian Concannon.

Haemonetics also issued its sales and earnings guidance for the fiscal 2017 year ending next April that missed the consensus expectation on Wall Street.

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