Baxter warns hurricane disruptions at IV facility may hit financials in 2025

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By Christy Santhosh and Mariam Sunny

(Reuters) -Baxter International warned on Friday that hurricane-related disruptions at its North Carolina IV solutions facility could affect its financials through early 2025.

Shares of the medical products maker fell 4.4% in morning trading.

The company has been trying to reinstate production at the plant, which makes 60% of the United States’ supply of intravenous fluids and some key dialysis solutions, after it was closed in late September due to flooding during Hurricane Helene.

While all manufacturing lines at the facility are expected to resume before the end of this year, the production of a key IV product will reach full capacity only in early 2025, CEO ​José Almeida said in an earnings call.

This could marginally impact first-quarter 2025 financials as the 1-liter IV bags constitute almost half of the IV production at the North Carolina facility, Almeida said.

Baxter estimates the hurricane-related impact on fourth-quarter 2024 sales to be about $200 million and expects a hit of between 15 cents and 20 cents per share to adjusted profit.

The medical products maker also cut its adjusted profit forecast for 2024 to between $2.90 and $2.94 per share, from $2.93 to $3.01 per share earlier.

The forecast cut was largely expected, although the magnitude was a “bit higher than what we thought”, according to Evercore analyst Vijay Kumar.

Baxter reaffirmed its adjusted operating margin forecast of about 16.5% and operational sales growth of between 4% and 5% in 2025 despite the impact from the hurricane.

On an adjusted basis, the company earned 80 cents per share in the third quarter, compared with an expectation of 78 cents per share, according to estimates compiled by LSEG.

(Reporting by Christy Santhosh and Mariam Sunny in Bengaluru; Editing by Pooja Desai)