Cerus Corporation ((CERS)) has held its Q4 earnings call. Read on for the main highlights of the call.
Discover the Best Stocks and Maximize Your Portfolio:
- See what stocks are receiving strong buy ratings from top-rated analysts.
- Filter, analyze, and streamline your search for investment opportunities with TipRanks’ Stock Screener.
Cerus Corporation’s recent earnings call painted a positive picture of the company’s financial performance in 2024. The company reported robust revenue growth and achieved positive adjusted EBITDA, which marks a significant milestone. Despite facing challenges such as a decline in government contract revenue and increased operating expenses, the sentiment remains optimistic due to Cerus’s growth trajectory and market expansion efforts.
Positive Adjusted EBITDA Achieved
Cerus Corporation successfully reached a pivotal achievement by attaining positive adjusted EBITDA for the full year 2024. This accomplishment is a substantial milestone in the company’s long history, signifying their effective financial strategies and operational efficiencies.
Double-Digit Product Revenue Growth
In 2024, Cerus Corporation experienced impressive double-digit product revenue growth compared to the previous year. This surge was fueled by the expansion of the global platelets business and increased demand for the INTERCEPT Fibrinogen Complex (IFC) within the U.S. market.
Strong IFC Sales Expansion
The sales of the INTERCEPT Fibrinogen Complex saw a remarkable 42% increase over 2023, totaling $9.2 million for the year. Notably, the fourth quarter alone witnessed a 30% rise compared to the previous year, underscoring strong market demand.
Global Market Penetration and Expansion
Cerus Corporation made significant strides in global market penetration. The Canadian Blood Services achieved 100% pathogen reduction adoption for platelet production, and growing interest was evident in key international markets, including China, Brazil, and the Middle East.
Decline in Government Contract Revenue
In 2024, Cerus saw a decline in government contract revenue, dropping to $21.1 million from $30.4 million in 2023. This decrease was mainly due to the completion of the U.S. Phase 3 ReCePI clinical trial, impacting the overall revenue figures.
Challenges in EMEA Gross Margins
The fourth-quarter product gross margins in the EMEA region faced challenges due to unfavorable FX rates, a stronger U.S. dollar, and increased discard rates. This resulted in a slight decline in gross margins to 53.9%.
Operating Expenses Increase in Q4
Cerus Corporation’s operating expenses in the fourth quarter rose to $34.8 million from $31.6 million in Q4 2023. This increase was partly attributed to a cumulative catch-up of accrued expenses, impacting overall profitability.
2025 Forward-Looking Guidance
Looking ahead to 2025, Cerus Corporation is optimistic about continuing its growth trajectory. The company expects product revenue growth between 8% to 11% year-over-year. They plan to build on the positive adjusted EBITDA achieved in 2024 and anticipate maintaining or even improving this metric. While operating expenses are projected to rise modestly due to inflationary pressures, the company aims to leverage these costs to support revenue growth. Additionally, Cerus expects to sustain positive operating cash flows, following $11.4 million in positive cash flow from operations in 2024, and is focusing on expanding its INTERCEPT product lines globally.
In conclusion, Cerus Corporation has demonstrated a strong financial performance in 2024, with positive adjusted EBITDA and robust revenue growth. Despite certain challenges, the company’s forward-looking guidance offers a promising outlook for 2025, emphasizing continued expansion and innovation in global markets, which could further enhance their market presence and financial stability.
