Thank you for the effort! You are however not the first one to suggest this.

The thing is, handlebars-xgettext should work pretty much exactly like xgettext (used for other languages, like JavaScript).
(Maybe one day, xgettext can even parse Handlebars and handlebars-xgettext becomes obsolete.)
This means string replacement is not something handlebars-xgettext should know about.

Some background
Handlebars' philosophy is: templates should be simple. Because of this, there is no way to wrap helpers (handlebars 1.3.0 now supports subexpressions). This leads many people to a solution like yours, where you do multiple things in one fat helper (string replacement and translation).

The better way however, is to pass the end-result to your template:

handlebarsTemplate({
  hello: stringReplacement(gettext('Hello %s, it is %s'), name, weekDay)
});

Your template can then simply contain this:

<h1>{{hello}}</h1>