Cerus Corporation (NASDAQ:CERS) concluded 2024 with double-digit product revenue growth and achieved positive adjusted EBITDA for the first time, marking a significant milestone for the company. Strong demand for the INTERCEPT Blood System and expanding adoption of the INTERCEPT Fibrinogen Complex (IFC) in the U.S. fueled robust financial performance.
Financial Performance: Surpassing Expectations
CEO Obi Greenman highlighted the company’s revenue milestone, with full-year 2024 product revenues reaching $180.3 million, surpassing guidance. In Q4 2024, product revenues hit $50.8 million, driven by strong platelet sales and a 30% year-over-year increase in IFC sales.
- Gross margins remained stable at 55.2% for the full year, with a slight dip to 53.9% in Q4 due to currency fluctuations and freight costs.
- Adjusted EBITDA for 2024 was $5.7 million, a major turnaround from a $10.7 million loss in 2023.
- Operating cash flow improved dramatically to $11.4 million, compared to cash used in operations of $43.2 million in 2023.
- The company ended 2024 with $80.5 million in cash and equivalents, ensuring financial stability for future growth.
2025 Outlook: Sustained Growth Ahead
Cerus has set 2025 product revenue growth guidance at 8%-11%, underpinned by continued expansion of its platelet franchise and increasing IFC adoption. Management is also optimistic about the INTERCEPT red blood cell CE mark submission, with key updates expected in the coming months.
The anticipated launch of the INT200 illuminator in Europe later in 2025 is expected to enhance operational efficiency and further bolster international expansion. The China market opportunity is projected to contribute revenues post-2025, following the NMPA approval and reimbursement process.
Key Analyst Insights: Supply & Geographic Expansion in Focus
During the Q&A session, analysts probed supply chain dynamics, IFC expansion, and global market strategies:
- Joshua Jennings (TD Cowen) inquired about Cerus’s ability to capture 50% of the U.S. IFC market opportunity. COO Vivek Jayaraman stressed ramping up production volumes and leveraging clinical evidence to boost market penetration.
- Jacob Johnson (Stephens) questioned IFC supply capacity and 2025 revenue outlook of $12M-$15M. Jayaraman assured that manufacturing capabilities are well-positioned to meet growing demand.
- Ross Osborn (Cantor Fitzgerald) sought clarity on SG&A expense trends and Brazil commercialization. CFO Kevin Green confirmed modest SG&A growth, while Jayaraman highlighted efforts to access Brazil’s public healthcare market.
- John Wilkin (Craig-Hallum) asked about platelet sales growth in North America. Jayaraman attributed slower Q4 growth to inventory normalization, but emphasized continued market share gains.
Quarterly Trends: Shifting Analyst Focus
Compared to Q3 2024, analyst concerns in Q4 shifted from overall product growth to supply chain management, IFC rollout, and margin sustainability:
- Gross margins declined slightly from 56.9% in Q3 to 53.9% in Q4, impacted by FX fluctuations and product discard rates.
- Management maintained a consistent growth outlook, but analysts probed supply risks and geographic expansion challenges.
- Analyst sentiment remained cautiously optimistic, reflecting confidence in long-term revenue potential despite near-term hurdles.
Navigating Risks: Supply Chain & Global Expansion
Management identified supply chain dynamics and BLA approvals for IFC production partners as crucial factors in sustaining growth. Margin variability remains a concern, influenced by:
- Foreign exchange fluctuations
- Product mix changes
- Freight and logistics costs
Additionally, slow progress in Brazil and China could delay revenue contributions, though management remains committed to navigating regulatory pathways and reimbursement approvals.
Positioned for Long-Term Growth
Cerus Corporation enters 2025 with strong momentum, driven by record revenue growth, increasing IFC adoption, and operational improvements. With new product launches and global expansion strategies in place, the company is well-positioned to capitalize on long-term market opportunities while mitigating short-term operational challenges.
