Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
Massachusetts
(State or other jurisdiction
of incorporation or organization)
|
|
04-2882273
(I.R.S. Employer Identification No.)
|
Yes
þ
|
|
No
o
|
Yes
þ
|
|
No
o
|
Large accelerated filer
þ
|
|
Accelerated filer
o
|
|
Non-accelerated filer
o
|
|
Smaller reporting company
o
|
Yes
o
|
|
No
þ
|
|
|
|
PAGE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
||||||
|
July 2,
2016 |
|
June 27,
2015 |
||||
Net revenues
|
$
|
209,956
|
|
|
$
|
213,413
|
|
Cost of goods sold
|
118,900
|
|
|
110,874
|
|
||
Gross profit
|
91,056
|
|
|
102,539
|
|
||
Operating expenses:
|
|
|
|
||||
Research and development
|
11,437
|
|
|
11,321
|
|
||
Selling, general and administrative
|
87,500
|
|
|
87,612
|
|
||
Total operating expenses
|
98,937
|
|
|
98,933
|
|
||
Operating (loss) income
|
(7,881
|
)
|
|
3,606
|
|
||
Interest and other expense, net
|
(2,177
|
)
|
|
(2,009
|
)
|
||
(Loss) income before provision for income taxes
|
(10,058
|
)
|
|
1,597
|
|
||
Provision for income taxes
|
288
|
|
|
1,864
|
|
||
Net loss
|
$
|
(10,346
|
)
|
|
$
|
(267
|
)
|
|
|
|
|
||||
Net loss per share - basic
|
$
|
(0.20
|
)
|
|
$
|
(0.01
|
)
|
Net loss per share - diluted
|
$
|
(0.20
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
|
||||
Weighted average shares outstanding
|
|
|
|
||||
Basic
|
51,021
|
|
|
51,360
|
|
||
Diluted
|
51,021
|
|
|
51,360
|
|
||
|
|
|
|
||||
Comprehensive loss
|
$
|
(11,233
|
)
|
|
$
|
(2,627
|
)
|
|
July 2,
2016 |
|
April 2,
2016 |
||||
|
(Unaudited)
|
|
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
118,248
|
|
|
$
|
115,123
|
|
Accounts receivable, less allowance of $2,351 at July 2, 2016 and $2,253 at April 2, 2016
|
149,668
|
|
|
157,093
|
|
||
Inventories, net
|
189,431
|
|
|
187,028
|
|
||
Prepaid expenses and other current assets
|
32,248
|
|
|
28,842
|
|
||
Total current assets
|
489,595
|
|
|
488,086
|
|
||
Property, plant and equipment, net
|
339,666
|
|
|
337,634
|
|
||
Intangible assets, less accumulated amortization of $190,638 at July 2, 2016 and $190,816 at April 2, 2016
|
198,121
|
|
|
204,458
|
|
||
Goodwill
|
268,589
|
|
|
267,840
|
|
||
Deferred tax asset, long term
|
7,572
|
|
|
7,055
|
|
||
Other long-term assets
|
13,848
|
|
|
14,055
|
|
||
Total assets
|
$
|
1,317,391
|
|
|
$
|
1,319,128
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Notes payable and current maturities of long-term debt
|
$
|
46,804
|
|
|
$
|
43,471
|
|
Accounts payable
|
36,799
|
|
|
39,674
|
|
||
Accrued payroll and related costs
|
44,330
|
|
|
35,798
|
|
||
Other liabilities
|
71,040
|
|
|
66,608
|
|
||
Total current liabilities
|
198,973
|
|
|
185,551
|
|
||
Long-term debt, net of current maturities
|
352,908
|
|
|
364,529
|
|
||
Long-term deferred tax liability
|
21,416
|
|
|
21,377
|
|
||
Other long-term liabilities
|
28,534
|
|
|
26,106
|
|
||
Total stockholders’ equity:
|
|
|
|
||||
Common stock, $0.01 par value; Authorized — 150,000,000 shares; Issued and outstanding — 51,059,107 shares at July 2, 2016 and 50,932,348 shares at April 2, 2016
|
511
|
|
|
509
|
|
||
Additional paid-in capital
|
445,138
|
|
|
439,912
|
|
||
Retained earnings
|
305,838
|
|
|
316,184
|
|
||
Accumulated other comprehensive loss
|
(35,927
|
)
|
|
(35,040
|
)
|
||
Total stockholders’ equity:
|
715,560
|
|
|
721,565
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,317,391
|
|
|
$
|
1,319,128
|
|
|
Three Months Ended
|
||||||
|
July 2,
2016 |
|
June 27,
2015 |
||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net loss
|
$
|
(10,346
|
)
|
|
$
|
(267
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
||||
Non-cash items:
|
|
|
|
||||
Depreciation and amortization
|
22,544
|
|
|
22,255
|
|
||
Asset impairments
|
1,766
|
|
|
—
|
|
||
Stock compensation expense
|
1,840
|
|
|
3,164
|
|
||
Unrealized gain from hedging activities
|
(907
|
)
|
|
(186
|
)
|
||
Provision for losses on accounts receivable and inventory
|
2,571
|
|
|
1,742
|
|
||
Other non-cash operating activities
|
257
|
|
|
271
|
|
||
Change in operating assets and liabilities:
|
|
|
|
||||
Change in accounts receivable, net
|
8,239
|
|
|
6,524
|
|
||
Change in inventories
|
(3,721
|
)
|
|
(2,410
|
)
|
||
Change in prepaid income taxes
|
(932
|
)
|
|
(369
|
)
|
||
Change in other assets and other liabilities
|
1,126
|
|
|
3,699
|
|
||
Change in accounts payable and accrued expenses
|
8,258
|
|
|
(25,173
|
)
|
||
Net cash provided by operating activities
|
30,695
|
|
|
9,250
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Capital expenditures
|
(22,479
|
)
|
|
(24,246
|
)
|
||
Proceeds from sale of property, plant and equipment
|
87
|
|
|
116
|
|
||
Other acquisitions and investments
|
—
|
|
|
(3,000
|
)
|
||
Net cash used in investing activities
|
(22,392
|
)
|
|
(27,130
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Payments on long-term real estate mortgage
|
—
|
|
|
(276
|
)
|
||
Net (decrease) increase in short-term loans
|
(1,261
|
)
|
|
4,380
|
|
||
Repayment of term loan borrowings
|
(7,114
|
)
|
|
—
|
|
||
Proceeds from employee stock purchase plan
|
1,980
|
|
|
2,263
|
|
||
Proceeds from exercise of stock options
|
1,409
|
|
|
2,893
|
|
||
Share repurchases
|
—
|
|
|
(39,032
|
)
|
||
Net cash used in financing activities
|
(4,986
|
)
|
|
(29,772
|
)
|
||
Effect of exchange rates on cash and cash equivalents
|
(192
|
)
|
|
(806
|
)
|
||
Net Change in Cash and Cash Equivalents
|
3,125
|
|
|
(48,458
|
)
|
||
Cash and Cash Equivalents at Beginning of Period
|
115,123
|
|
|
160,662
|
|
||
Cash and Cash Equivalents at End of Period
|
$
|
118,248
|
|
|
$
|
112,204
|
|
Supplemental Disclosures of Cash Flow Information:
|
|
|
|
||||
Interest paid
|
$
|
2,072
|
|
|
$
|
2,068
|
|
Income taxes paid
|
$
|
1,541
|
|
|
$
|
1,625
|
|
Transfers from inventory to fixed assets for placement of Haemonetics equipment
|
$
|
1,764
|
|
|
$
|
2,925
|
|
|
|
Three Months Ended
|
||||||
(In thousands, except per share amounts)
|
|
July 2,
2016 |
|
June 27,
2015 |
||||
Basic EPS
|
|
|
|
|
||||
Net loss
|
|
$
|
(10,346
|
)
|
|
$
|
(267
|
)
|
Weighted average shares
|
|
51,021
|
|
|
51,360
|
|
||
Basic loss per share
|
|
$
|
(0.20
|
)
|
|
$
|
(0.01
|
)
|
Diluted EPS
|
|
|
|
|
||||
Net loss
|
|
$
|
(10,346
|
)
|
|
$
|
(267
|
)
|
Basic weighted average shares
|
|
51,021
|
|
|
51,360
|
|
||
Net effect of common stock equivalents
|
|
—
|
|
|
—
|
|
||
Diluted weighted average shares
|
|
51,021
|
|
|
51,360
|
|
||
Diluted loss per share
|
|
$
|
(0.20
|
)
|
|
$
|
(0.01
|
)
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
July 2,
2016 |
|
June 27,
2015 |
||||
Warranty accrual as of the beginning of the period
|
|
$
|
420
|
|
|
$
|
531
|
|
Warranty provision
|
|
163
|
|
|
172
|
|
||
Warranty spending
|
|
(234
|
)
|
|
(266
|
)
|
||
Warranty accrual as of the end of the period
|
|
$
|
349
|
|
|
$
|
437
|
|
(In thousands)
|
|
July 2,
2016 |
|
April 2,
2016 |
||||
Raw materials
|
|
$
|
61,098
|
|
|
$
|
62,062
|
|
Work-in-process
|
|
14,644
|
|
|
13,180
|
|
||
Finished goods
|
|
113,689
|
|
|
111,786
|
|
||
Total inventories
|
|
$
|
189,431
|
|
|
$
|
187,028
|
|
(In thousands)
|
|
Amount of (Loss) Gain
Recognized in Accumulated Other Comprehensive Loss |
|
Amount of (Loss) Gain Reclassified
from Accumulated Other Comprehensive Loss into Earnings |
|
Location in
Consolidated Statements of
Income and Comprehensive (Loss) Income
|
|
Amount of Gain (Loss) Excluded from
Effectiveness
Testing *
|
|
Location in
Consolidated Statements of Income and Comprehensive Loss |
||||||
Derivative Instruments
|
|
|
|
|
|
|
|
|
|
|
||||||
Designated foreign currency hedge contracts, net of tax
|
|
$
|
(1,933
|
)
|
|
$
|
(1,024
|
)
|
|
Net revenues, COGS, and SG&A
|
|
$
|
102
|
|
|
Interest and other expense, net
|
Non-designated foreign currency hedge contracts
|
|
—
|
|
|
—
|
|
|
|
|
(352
|
)
|
|
Interest and other expense, net
|
|||
Designated interest rate swaps, net of tax
|
|
$
|
(116
|
)
|
|
$
|
—
|
|
|
Interest and other expense, net
|
|
$
|
—
|
|
|
|
(In thousands)
|
|
Location in
Balance Sheet |
|
As of July 2, 2016
|
|
As of April 2, 2016
|
||||
Derivative Assets:
|
|
|
|
|
|
|
||||
Designated foreign currency hedge contracts
|
|
Other current assets
|
|
$
|
561
|
|
|
$
|
427
|
|
Designated interest rate swaps
|
|
Other current assets
|
|
—
|
|
|
—
|
|
||
|
|
|
|
$
|
561
|
|
|
$
|
427
|
|
Derivative Liabilities:
|
|
|
|
|
|
|
||||
Designated foreign currency hedge contracts
|
|
Other current liabilities
|
|
$
|
4,817
|
|
|
$
|
4,056
|
|
Designated interest rate swaps
|
|
Other current liabilities
|
|
211
|
|
|
154
|
|
||
|
|
|
|
$
|
5,028
|
|
|
$
|
4,210
|
|
•
|
Level 1 — Inputs to the valuation methodology are quoted market prices for identical assets or liabilities.
|
•
|
Level 2 — Inputs to the valuation methodology are other observable inputs, including quoted market prices for similar assets or liabilities and market-corroborated inputs.
|
•
|
Level 3 — Inputs to the valuation methodology are unobservable inputs based on management’s best estimate of inputs market participants would use in pricing the asset or liability at the measurement date, including assumptions about risk.
|
|
|
As of July 2, 2016
|
||||||||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
|
$
|
67,018
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
67,018
|
|
Designated foreign currency hedge contracts
|
|
—
|
|
|
561
|
|
|
—
|
|
|
561
|
|
||||
|
|
$
|
67,018
|
|
|
$
|
561
|
|
|
$
|
—
|
|
|
$
|
67,579
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Designated foreign currency hedge contracts
|
|
$
|
—
|
|
|
$
|
4,817
|
|
|
$
|
—
|
|
|
$
|
4,817
|
|
Designated interest rate swaps
|
|
—
|
|
|
211
|
|
|
—
|
|
|
211
|
|
||||
|
|
$
|
—
|
|
|
$
|
5,028
|
|
|
$
|
—
|
|
|
$
|
5,028
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
As of April 2, 2016
|
||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
|
$
|
72,491
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
72,491
|
|
Designated foreign currency hedge contracts
|
|
—
|
|
|
427
|
|
|
—
|
|
|
427
|
|
||||
Designated interest rate swaps
|
|
$
|
72,491
|
|
|
$
|
427
|
|
|
$
|
—
|
|
|
$
|
72,918
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Designated foreign currency hedge contracts
|
|
$
|
—
|
|
|
$
|
4,056
|
|
|
$
|
—
|
|
|
$
|
4,056
|
|
Designated interest rate swaps
|
|
—
|
|
|
154
|
|
|
—
|
|
|
154
|
|
||||
|
|
$
|
—
|
|
|
$
|
4,210
|
|
|
$
|
—
|
|
|
$
|
4,210
|
|
(In thousands)
|
July 2,
2016 |
|
April 2,
2016 |
||||
Beginning balance
|
$
|
2,523
|
|
|
$
|
7,070
|
|
Additions for tax positions of prior years
|
1,290
|
|
|
340
|
|
||
Reductions of tax positions
|
—
|
|
|
(4,158
|
)
|
||
Closure of statute of limitations
|
—
|
|
|
(729
|
)
|
||
Ending balance
|
$
|
3,813
|
|
|
$
|
2,523
|
|
•
|
Japan
|
•
|
Europe, Middle East and Africa (collectively “EMEA”)
|
•
|
North America Plasma
|
•
|
All Other
|
•
|
Americas Blood Center and Hospital
|
•
|
Asia - Pacific
|
|
Three Months Ended
|
||||||
(In thousands)
|
July 2,
2016 |
|
June 27,
2015 |
||||
Net revenues
|
|
|
|
||||
Japan
|
$
|
14,566
|
|
|
$
|
17,595
|
|
EMEA
|
45,741
|
|
|
48,811
|
|
||
North America Plasma
|
73,475
|
|
|
64,443
|
|
||
All Other
|
78,020
|
|
|
80,219
|
|
||
Net revenues (constant currency)
|
211,802
|
|
|
211,068
|
|
||
Effect of exchange rates
|
(1,846
|
)
|
|
2,345
|
|
||
Net revenues (reported)
|
$
|
209,956
|
|
|
$
|
213,413
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
July 2,
2016 |
|
June 27,
2015 |
||||
Segment operating income
|
|
|
|
||||
Japan
|
$
|
6,121
|
|
|
$
|
7,682
|
|
EMEA
|
10,048
|
|
|
10,526
|
|
||
North America Plasma
|
27,277
|
|
|
26,156
|
|
||
All Other
|
25,636
|
|
|
28,635
|
|
||
Segment operating income (constant currency)
|
69,082
|
|
|
72,999
|
|
||
Corporate operating expenses (constant currency)
|
(48,451
|
)
|
|
(49,252
|
)
|
||
Non-GAAP operating income (constant currency)
|
20,631
|
|
|
23,747
|
|
||
Effect of exchange rates
|
(1,306
|
)
|
|
2,080
|
|
||
Non-GAAP operating income (reported)
|
19,325
|
|
|
25,827
|
|
||
Unallocated amounts
|
|
|
|
||||
Restructuring and restructuring related costs
|
18,816
|
|
|
14,816
|
|
||
Deal amortization
|
7,075
|
|
|
7,405
|
|
||
Asset impairments
|
1,315
|
|
|
—
|
|
||
Operating (loss) income
|
$
|
(7,881
|
)
|
|
$
|
3,606
|
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
July 2,
2016 |
|
June 27,
2015 |
|
% Increase/
(Decrease) |
|||||
Plasma
|
|
$
|
97,649
|
|
|
$
|
88,527
|
|
|
10.3
|
%
|
Blood Center
|
|
70,943
|
|
|
83,083
|
|
|
(14.6
|
)%
|
||
Cell Processing
|
|
26,076
|
|
|
27,813
|
|
|
(6.2
|
)%
|
||
Hemostasis Management
|
|
15,288
|
|
|
13,990
|
|
|
9.3
|
%
|
||
Net revenues
|
|
$
|
209,956
|
|
|
$
|
213,413
|
|
|
(1.6
|
)%
|
(In thousands)
|
Severance and Other Employee Costs
|
|
Other Costs
|
|
Accelerated Depreciation
|
|
Asset
Write Down |
|
Total Restructuring
|
||||||||||
Balance at April 2, 2016
|
$
|
8,752
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,752
|
|
Costs incurred
|
15,840
|
|
|
212
|
|
|
—
|
|
|
334
|
|
|
16,386
|
|
|||||
Payments
|
(7,134
|
)
|
|
(212
|
)
|
|
—
|
|
|
—
|
|
|
(7,346
|
)
|
|||||
Non-cash adjustments
|
—
|
|
|
|
|
|
—
|
|
|
(334
|
)
|
|
(334
|
)
|
|||||
Balance at July 2, 2016
|
$
|
17,458
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17,458
|
|
Restructuring costs
|
Three Months Ended
|
||||||
(in thousands)
|
July 2, 2016
|
|
June 27, 2015
|
||||
Japan
|
$
|
874
|
|
|
$
|
9
|
|
EMEA
|
3,074
|
|
|
20
|
|
||
North America Plasma
|
375
|
|
|
—
|
|
||
All Other
|
12,063
|
|
|
9,430
|
|
||
Total
|
$
|
16,386
|
|
|
$
|
9,459
|
|
|
|
|
|
||||
Restructuring related costs
|
Three Months Ended
|
||||||
(in thousands)
|
July 2, 2016
|
|
June 27, 2015
|
||||
Japan
|
$
|
1
|
|
|
$
|
144
|
|
EMEA
|
26
|
|
|
242
|
|
||
North America Plasma
|
—
|
|
|
40
|
|
||
All Other
|
2,403
|
|
|
4,931
|
|
||
Total
|
$
|
2,430
|
|
|
$
|
5,357
|
|
|
|
|
|
||||
Total restructuring and restructuring related costs
|
$
|
18,816
|
|
|
$
|
14,816
|
|
(In thousands)
|
|
Foreign Currency
|
|
Defined Benefit Plans
|
|
Net Unrealized Gain/Loss on Derivatives
|
|
Total
|
||||||||
Balance as of April 2, 2016
|
|
$
|
(22,499
|
)
|
|
$
|
(7,492
|
)
|
|
$
|
(5,049
|
)
|
|
$
|
(35,040
|
)
|
Other comprehensive income/(loss) before reclassifications
(1)
|
|
138
|
|
|
—
|
|
|
(2,049
|
)
|
|
(1,911
|
)
|
||||
Amounts reclassified from Accumulated Other Comprehensive Loss
(1)
|
|
—
|
|
|
—
|
|
|
1,024
|
|
|
1,024
|
|
||||
Net current period other comprehensive income/(loss)
|
|
138
|
|
|
—
|
|
|
(1,025
|
)
|
|
(887
|
)
|
||||
Balance as of July 2, 2016
|
|
$
|
(22,361
|
)
|
|
$
|
(7,492
|
)
|
|
$
|
(6,074
|
)
|
|
$
|
(35,927
|
)
|
|
|
Three Months Ended
|
|||||||||
(In thousands, except per share data)
|
|
July 2,
2016 |
|
June 27,
2015 |
|
% Increase/
(Decrease) |
|||||
Net revenues
|
|
$
|
209,956
|
|
|
$
|
213,413
|
|
|
(1.6
|
)%
|
Gross profit
|
|
$
|
91,056
|
|
|
$
|
102,539
|
|
|
(11.2
|
)%
|
% of net revenues
|
|
43.4
|
%
|
|
48.0
|
%
|
|
|
|||
Operating expenses
|
|
$
|
98,937
|
|
|
$
|
98,933
|
|
|
—
|
%
|
Operating (loss) income
|
|
$
|
(7,881
|
)
|
|
$
|
3,606
|
|
|
n/m
|
|
% of net revenues
|
|
(3.8
|
)%
|
|
1.7
|
%
|
|
|
|||
Interest and other expense, net
|
|
$
|
(2,177
|
)
|
|
$
|
(2,009
|
)
|
|
8.4
|
%
|
(Loss) income before provision for income taxes
|
|
$
|
(10,058
|
)
|
|
$
|
1,597
|
|
|
n/m
|
|
Provision for income taxes
|
|
$
|
288
|
|
|
$
|
1,864
|
|
|
n/m
|
|
% of pre-tax income
|
|
(2.9
|
)%
|
|
116.7
|
%
|
|
|
|||
Net loss
|
|
$
|
(10,346
|
)
|
|
$
|
(267
|
)
|
|
n/m
|
|
% of net revenues
|
|
(4.9
|
)%
|
|
(0.1
|
)%
|
|
|
|||
Net loss per share - diluted
|
|
$
|
(0.20
|
)
|
|
$
|
(0.01
|
)
|
|
n/m
|
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
July 2,
2016 |
|
June 27,
2015 |
|
% Increase/
(Decrease) |
|||||
United States
|
|
$
|
125,700
|
|
|
$
|
120,695
|
|
|
4.1
|
%
|
International
|
|
84,256
|
|
|
92,718
|
|
|
(9.1
|
)%
|
||
Net revenues
|
|
$
|
209,956
|
|
|
$
|
213,413
|
|
|
(1.6
|
)%
|
|
|
|
|||||||||
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
July 2,
2016 |
|
June 27,
2015 |
|
% Increase/
(Decrease) |
|||||
Plasma
|
|
$
|
97,649
|
|
|
$
|
88,527
|
|
|
10.3
|
%
|
Blood Center
|
|
70,943
|
|
|
83,083
|
|
|
(14.6
|
)%
|
||
Cell Processing
|
|
26,076
|
|
|
27,813
|
|
|
(6.2
|
)%
|
||
Hemostasis Management
|
|
15,288
|
|
|
13,990
|
|
|
9.3
|
%
|
||
Net revenues
|
|
$
|
209,956
|
|
|
$
|
213,413
|
|
|
(1.6
|
)%
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
July 2,
2016 |
|
June 27,
2015 |
|
% Increase/
(Decrease) |
|||||
Gross profit
|
|
$
|
91,056
|
|
|
$
|
102,539
|
|
|
(11.2
|
)%
|
% of net revenues
|
|
43.4
|
%
|
|
48.0
|
%
|
|
|
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
July 2,
2016 |
|
June 27,
2015 |
|
% Increase/
(Decrease)
|
|||||
Research and development
|
|
$
|
11,437
|
|
|
$
|
11,321
|
|
|
1.0
|
%
|
% of net revenues
|
|
5.4
|
%
|
|
5.3
|
%
|
|
|
|
||
Selling, general and administrative
|
|
$
|
87,500
|
|
|
$
|
87,612
|
|
|
(0.1
|
)%
|
% of net revenues
|
|
41.7
|
%
|
|
41.1
|
%
|
|
|
|
||
Total operating expenses
|
|
$
|
98,937
|
|
|
$
|
98,933
|
|
|
—
|
%
|
% of net revenues
|
|
47.1
|
%
|
|
46.4
|
%
|
|
|
|
(Dollars in thousands)
|
|
July 2,
2016 |
|
April 2,
2016 |
||||
Cash & cash equivalents
|
|
$
|
118,248
|
|
|
$
|
115,123
|
|
Working capital
|
|
$
|
290,622
|
|
|
$
|
302,535
|
|
Current ratio
|
|
2.5
|
|
|
2.6
|
|
||
Net debt
(1)
|
|
$
|
(281,464
|
)
|
|
$
|
(292,877
|
)
|
Days sales outstanding (DSO)
|
|
64
|
|
|
58
|
|
||
Disposable finished goods inventory turnover
|
|
5.2
|
|
|
4.6
|
|
|
|
Three Months Ended
|
||||||||||
(In thousands)
|
|
July 2,
2016 |
|
June 27,
2015 |
|
Increase/
(Decrease) |
||||||
Net cash provided by (used in):
|
|
|
|
|
|
|
||||||
Operating activities
|
|
$
|
30,695
|
|
|
$
|
9,250
|
|
|
$
|
21,445
|
|
Investing activities
|
|
(22,392
|
)
|
|
(27,130
|
)
|
|
4,738
|
|
|||
Financing activities
|
|
(4,986
|
)
|
|
(29,772
|
)
|
|
24,786
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
(1)
|
|
(192
|
)
|
|
(806
|
)
|
|
614
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
$
|
3,125
|
|
|
$
|
(48,458
|
)
|
|
|
•
|
Increasing oversight by our management in the calculation and reporting of certain tax balances of our non-U.S. operations;
|
•
|
Enhancing policies and procedures relating to account reconciliation and analysis;
|
•
|
Augmenting our tax accounting resources;
|
•
|
Increasing communication to information providers for tax jurisdiction specific information; and
|
•
|
Strengthening communication and information flows between the tax department and the controllers group.
|
10.1
|
|
Performance Share Unit Agreement between Haemonetics Corporation and Christopher Simon dated as of June 29, 2016.
|
|
|
|
10.2
|
|
Amended and Restated 2007 Employee Stock Purchase Agreement (as amended and restated on July 21, 2016).
|
|
|
|
10.3
|
|
Haemonetics Corporation Worldwide Executive Bonus Plan as adopted on July 21, 2016.
|
|
|
|
31.1
|
|
Certification pursuant to Section 302 of Sarbanes-Oxley Act of 2002, of Christopher Simon, President and Chief Executive Officer of the Company
|
|
|
|
31.2
|
|
Certification pursuant to Section 302 of Sarbanes-Oxley of 2002, of Dan Goldstein, Vice President, Corporate Controller of the Company
|
|
|
|
32.1
|
|
Certification Pursuant to 18 United States Code Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Christopher Simon, President and Chief Executive Officer of the Company
|
|
|
|
32.2
|
|
Certification Pursuant to 18 United States Code Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Dan Goldstein, Vice President, Corporate Controller of the Company
|
|
|
|
101*
|
|
The following materials from Haemonetics Corporation on Form 10-Q for the quarter ended July 2, 2016, formatted in Extensible Business Reporting Language (XBRL); (i) Consolidated Statements of Income and Comprehensive Income, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, and (iv) Notes to Consolidated Financial Statements.
|
*
|
|
In accordance with Rule 406T of Regulation S-T, the XBRL-related information in Exhibit 101 to this Form 10-Q is deemed not filed or part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act, is deemed not filed for the purposes of section 18 of the Exchange Act, and otherwise is not subject to liability under these sections.
|
†
|
|
Agreement, plan, or arrangement related to the compensation of officers or directors
|
|
HAEMONETICS CORPORATION
|
|
|
8/1/2016
|
By:
|
/s/ Christopher Simon
|
|
|
|
Christopher Simon,
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
8/1/2016
|
By:
|
/s/ Dan Goldstein
|
|
|
|
Dan Goldstein, Vice President, Corporate Controller
|
|
|
|
(Principal Financial Officer)
|
|
(i)
|
Calculation of Revenue Metric
. The Revenue Performance Metric is determined by comparing Revenue to the Target Revenue on
Schedule A
. “
Revenue
” equals fiscal 2019 revenue determined in accordance with GAAP. Both Target Revenue and Revenue may be adjusted by the Committee to reflect mergers, acquisitions and divestures completed
|
(ii)
|
Calculation of Operating Income Metric
. The Operating Income Metric is determined by comparing Operating Income to the Target Operating Income on
Schedule A
. “
Operating Income
” equals fiscal 2019 operating income determined in accordance with GAAP excluding cash severance, restructuring charges, restructuring related spending, non-cash charges related to transformation activity, impairment charges, and deal amortization. Both Operating Income and Target Operating Income may be adjusted by the Committee to reflect mergers, acquisitions and divestures completed during the Performance Period and changes in the Company’s accounting practices and changes in GAAP which affect the comparability of results.
|
(iii)
|
Calculation of Expense Metric
. The Expense Metric is determined by comparing the General and Administrative Expense as a percentage of revenue, as determined in accordance with the Company’s accounting practices, to the Target Expense on
Schedule A
. “
General and Administrative Expense
” equals selling, general and administrative expense reported on the Company’s fiscal 2019 GAAP income statement, minus all expenses in that item related to sales and marketing in the Company’s accounting records. Both revenue and selling, general and administrative expense may be adjusted by the Committee to reflect mergers, acquisitions and divestures completed during the Performance Period and changes in the Company’s accounting policies and changes in GAAP which affect comparability of results.
|
(iv)
|
Calculation of Customer Facing Metric
. The Customer Facing Metric is determined by comparing the number of full time employment positions at the Company and its subsidiaries which are primarily engaged in sales, sales support, business development, clinical sales, donor sales, field service, global maketing, market intelligence, patience sales, software implementation, product and regional marketing and customer service, including software and hardware maintenance, and excluding all others such as Franchise Marketing, legal Enterprise Information Technology, Human Resources, Finance, Procurement, Regulatory, Quality, Manufacturing, Research and Development.
|
(v)
|
Weighting of Metrics.
In calculating the Share Payout, the Committee shall weigh each of the four Performance Metrics in accordance with the “Weight” column on
Schedule A
.
|
(vi)
|
Profit Requirement.
Notwithstanding the satisfaction of the Performance Metrics and the employment requirement, no Share Payout shall be made
|
(vii)
|
Negative Discretion.
The Committee may exercise negative discretion consistent with Section 162(m) of the Code to reduce the payment under this Agreement.
|
(viii)
|
Payment Timing.
Subject to any earlier payment made under Section 2(f) below, any Share Payout shall be made by the Company in a single payment of shares of Stock (subject to applicable tax withholding) no earlier than the Maturity Date and later than July 31, 2019 following certification by the Committee of the achievement of the Profit Requirement.
|
Performance Metrics
|
Performance Targets
|
Weight
|
|||||||||||
Target Revenue (millions)
|
$908.0
|
$910.4
|
$912.8
|
$915.2
|
$917.6
|
$920.0
|
$922.0
|
$924.0
|
$926.0
|
$928.0
|
$930.0
|
33.3%
|
|
Target Operating Income (millions)
|
$144.1
|
$149.3
|
$154.5
|
$159.6
|
$164.8
|
$170.0
|
$171.0
|
$172.0
|
$173.0
|
$174.0
|
$175.0
|
33.3%
|
|
Target Expense (percentage of GAAP revenue)
|
16%
|
15.7%
|
15.4%
|
15.1%
|
14.8%
|
14.5%
|
14.2%
|
13.9%
|
13.6%
|
13.3%
|
13%
|
16.7%
|
|
Target Customer Facing Positions
|
737
|
739
|
740
|
742
|
743
|
745
|
746
|
748
|
749
|
750
|
752
|
16.7%
|
|
Payout Percentage
|
50%
|
60%
|
70%
|
80%
|
90%
|
100%
|
110%
|
120%
|
130%
|
140%
|
150%
|
-
|
As Amended April 7, 2016 –
|
To increase the number of shares available under the Plan, extend the Plan’s term and make administrative revisions, including updated price calculations and treatment in a change of control transaction.
|
Type of Change
|
Change On or Before the 15
th
of the Month
|
Change After the
15 th of the Month |
New Employee of Company or Affiliate
|
Participant eligible on first day of employment
|
Participant eligible on first day of month following first day of employment
|
Transfer or Status Change Affecting Award or Base Salary
|
Change effective on status change date
|
Change effective on first day of month following status change date
|
Leave of Absence or Long-Term Disability Start
|
No eligibility in that month
|
Eligible for portion of month in active employment
|
Leave of Absence or Long Term Disability Return
|
Eligible for portion of month in active employment
|
No eligibility in that month; eligibility 1st of next month
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Haemonetics Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Christopher Simon
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Christopher Simon, President and Chief Executive
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Officer (Principal Executive Officer)
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1.
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I have reviewed this quarterly report on Form 10-Q of Haemonetics Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Dan Goldstein
|
|
||
|
Dan Goldstein, Vice President, Corporate Controller
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||
|
(Principal Financial Officer)
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|
|
/s/ Christopher Simon
|
|
||
|
Christopher Simon,
|
|
||
|
President and Chief Executive Officer
|
|
|
/s/ Dan Goldstein
|
|
||
|
Dan Goldstein,
|
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||
|
Vice President and Corporate Controller
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