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IRADIMED CORPORATION Announces Third Quarter 2021 Financial Results

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·16 min read
In this article:
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  • Reports third quarter 2021 revenue of $10.9 million, GAAP diluted EPS of $0.20 and non-GAAP diluted EPS of $0.23

  • Increases full-year 2021 financial guidance

WINTER SPRINGS, Fla., Oct. 29, 2021 (GLOBE NEWSWIRE) -- IRADIMED CORPORATION (the “Company”) (NASDAQ: IRMD), a leader in the development of innovative magnetic resonance imaging (“MRI”) medical devices and the only known provider of a non-magnetic intravenous (“IV”) infusion pump system, and non-magnetic patient vital signs monitoring systems that are designed for use during MRI procedures, today announced financial results for the three and nine months ended September 30, 2021.

“I am pleased with these financial results and continue to be proud of our performance and resiliency in an everchanging environment marked by the continued uncertainties of COVID. With these financial results, we are on pace to post approximately 8 percent revenue growth over the pre-COVID 2019 year as well as achieve the highest full-year revenue in Iradimed’s history,” said Roger Susi, President and Chief Executive Officer of the Company.

Three Months Ended September 30, 2021

For the third quarter ended September 30, 2021, the Company reported revenue of $10.9 million compared to $7.7 million for the third quarter 2020. Net income was $2.6 million, or $0.20 per diluted share, compared to $1.1 million, or $0.09 per diluted share for the third quarter 2020. The increase in net income and diluted earnings per share is primarily the result of a $3.2 million increase in revenue for the third quarter 2021.

Non-GAAP net income was $2.8 million, or $0.23 per diluted share, for the quarter ended September 30, 2021, and excludes $0.3 million of stock compensation expense, net of tax expense. Non-GAAP net income for the quarter ended September 30, 2020 was $1.4 million, or $0.11 per diluted share, and excludes $0.3 million of stock compensation expense, net of tax.

Nine Months Ended September 30, 2021

For the nine months ended September 30, 2021, the Company reported revenue of $29.9 million compared to $23.2 million for the same period in 2020. Net income was $5.4 million, or $0.43 per diluted share, compared to $0.7 million, or $0.06 per diluted share for the same period in 2020. The increase in net income and diluted earnings per share is primarily the result of a $6.8 million increase in revenue and a $2.8 million decrease in general and administrative expenses, partially offset by a $3.3 million increase in income tax expense for the nine months ended September 30, 2021. During the nine months ended September 30, 2020, the Company recognized total general and administrative expense of $3.2 million related to our former CEO.

Non-GAAP net income was $6.2 million, or $0.50 per diluted share, for the nine months ended September 30, 2021, and excludes $0.8 million of stock compensation expense, net of tax expense. Non-GAAP net income for the nine months ended September 30, 2020 was $4.2 million, or $0.33 per diluted share, which excludes $1.1 million of on-going stock compensation expense, net of tax, and $2.4 million of expenses, net of tax, related to the separation of our former CEO.

Revenue Information:

Three Months Ended

Nine Months Ended

September 30,

September 30,

2021

2020

2021

2020

(unaudited)

(unaudited)

Devices:

MRI compatible IV infusion pump system

$

3,369,068

$

2,153,699

$

9,329,182

$

6,693,692

MRI Compatible Patient Vital Signs Monitoring Systems

3,779,442

2,282,943

9,760,991

6,829,932

Total Devices revenue

7,148,510

4,436,642

19,090,173

13,523,624

Disposables, services and other

3,285,656

2,802,039

9,412,091

8,269,487

Amortization of extended warranty agreements

473,136

460,415

1,439,457

1,378,218

Total revenue

$

10,907,302

$

7,699,096

$

29,941,721

$

23,171,329


For the third quarter 2021, domestic sales were 79.5 percent of total revenue, compared to 84.0 percent for the third quarter 2020. Gross profit margin was 77.1 percent for the third quarter 2021, compared to 74.6 percent for the third quarter 2020.

For the nine months ended September 30, 2021, domestic sales were 80.1 percent of total revenue, compared to 75.2 percent for the same period in 2020. Gross profit margin was 76.1 percent for the nine months ended September 30, 2021, compared to 73.9 percent for the same period in 2020.

Cash Flow:

For the nine months ended September 30, 2021, cash from operations was $7.9 million, compared to $3.3 million for the same period in 2020.

For the third quarter ended September 30, 2021, free cash flow was $3.2 million, compared to $1.3 million for the third quarter 2020. For the nine months ended September 30, 2021, free cash flow was $7.5 million, compared to $3.0 million for the same period in 2020.

Financial Guidance

For the fourth quarter 2021, the Company expects to report revenue of $11.5 million to $11.7 million, GAAP diluted earnings per share of $0.17 to $0.18, and non-GAAP diluted earnings per share of $0.20 to $0.21.

The Company increased its full-year financial guidance, and now expects to report revenue of $41.4 million to $41.6 million, GAAP diluted earnings per share of $0.60 to $0.61, and non-GAAP diluted earnings per share of $0.70 to $0.71. The Company’s previously expected full-year 2021 revenue was $40.0 million to $40.4 million, GAAP diluted earnings per share of $0.53 to $0.55, and non-GAAP diluted earnings per share of $0.60 to $0.62.

The Company’s non-GAAP diluted earnings per share guidance excludes stock-based compensation expense, net of tax, which the Company expects to be approximately $0.3 million and $1.1 million for the fourth quarter and full year 2021, respectively.

Use of non-GAAP Financial Measures

The Company believes the use of non-GAAP net income, free cash flow and infrequent income tax items are helpful to our investors. These measures, which we refer to as our non-GAAP financial measures, are not prepared in accordance with U.S. GAAP.

We calculate non-GAAP net income as net income excluding (1) stock-based compensation expense, net of tax. Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash expenses, we believe that providing non-GAAP financial measures that exclude stock-based compensation expense allows for meaningful comparisons between our operating results from period to period; (2) operating expenses, net of tax, that we believe are not indicative of the Company’s on-going core operating performance, and; (3) infrequent tax items are considered based on their nature and are excluded from the provision for income taxes as these costs or benefits are not indicative of our normal or future provision for income taxes. We calculate free cash flow as net cash provided by operating activities, less net cash used in investing activities for purchases of property and equipment.

We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that can be used for strategic opportunities, including investing in our business, making strategic acquisitions, strengthening our balance sheet and returning cash to our shareholders through various means.

All of our non-GAAP financial measures are important tools for financial and operational decision making and for evaluating our on-going core operating results.

A reconciliation of the non-GAAP financial measures used in this release to the most comparable U.S. GAAP measures for the respective periods can be found in the table later in this release immediately following the condensed statements of cash flows. These non-GAAP financial measures should not be considered in isolation or as a substitute for a measure of the Company’s operating performance or liquidity prepared in accordance with U.S. GAAP and are not indicative of net income or cash provided by operating activities.

Conference Call

IRADIMED has scheduled a conference call to discuss this announcement beginning at 11:00 a.m. Eastern Time today, October 29, 2021. Individuals interested in listening to the conference call may do so by dialing 1-844-413-1781 for domestic callers, or 1-716-247-5767 for international callers, and entering the reservation code 1675895.

The conference call will also be available real-time via the internet at http://www.iradimed.com/en-us/investors/events/. A recording of the call will be available on the Company’s website following the completion of the call.

About IRADIMED CORPORATION

IRADIMED CORPORATION is a leader in the development of innovative magnetic resonance imaging (“MRI”) compatible medical devices. We are the only known provider of a non-magnetic intravenous (“IV”) infusion pump system that is specifically designed to be safe for use during MRI procedures. We were the first to develop an infusion delivery system that largely eliminates many of the dangers and problems present during MRI procedures. Standard infusion pumps contain magnetic and electronic components which can create radio frequency interference and are dangerous to operate in the presence of the powerful magnet that drives an MRI system. Our patented MRidium® MRI compatible IV infusion pump system has been designed with a non-magnetic ultrasonic motor, uniquely designed non-ferrous parts and other special features to safely and predictably deliver anesthesia and other IV fluids during various MRI procedures. Our pump solution provides a seamless approach that enables accurate, safe and dependable fluid delivery before, during and after an MRI scan, which is important to critically-ill patients who cannot be removed from their vital medications, and children and infants who must generally be sedated to remain immobile during an MRI scan.

Our 3880 MRI compatible patient vital signs monitoring system has been designed with non-magnetic components and other special features to safely and accurately monitor a patient’s vital signs during various MRI procedures. The IRADIMED 3880 system operates dependably in magnetic fields up to 30,000 gauss, which means it can operate virtually anywhere in the MRI scanner room. The IRADIMED 3880 has a compact, lightweight design allowing it to travel with the patient from their critical care unit, to the MRI and back, resulting in increased patient safety through uninterrupted vital signs monitoring and decreasing the amount of time critically ill patients are away from critical care units. The features of the IRADIMED 3880 include: wireless ECG with dynamic gradient filtering; wireless SpO2 using Masimo® algorithms; non-magnetic respiratory CO2; invasive and non-invasive blood pressure; patient temperature, and; optional advanced multi-gas anesthetic agent unit featuring continuous Minimum Alveolar Concentration measurements. The IRADIMED 3880 MRI compatible patient vital signs monitoring system has an easy-to-use design and allows for the effective communication of patient vital signs information to clinicians.

For more information please visit www.iradimed.com.

Forward-Looking Statements

This press release contains forward-looking statements as defined in the Private Securities Litigation Act of 1995, particularly statements regarding our expectations, beliefs, plans, intentions, future operations, financial condition and prospects, and business strategies. These statements relate to future events or our future financial performance or condition and involve unknown risks, uncertainties and other factors that could cause our actual results, level of activity, performance or achievement to differ materially from those expressed or implied by these forward-looking statements. The risks and uncertainties referred to above include, but are not limited to, risks associated with the Company’s ability to receive an EC Certificate or CE Mark for our existing products and product candidates, receive FDA 510(k) clearance for new products and product candidates; unexpected costs, delays or diversion of management’s attention associated with the design, manufacture or sale of new products; the Company’s ability to implement successful sales techniques for existing and future products and evaluate the effectiveness of its sales techniques; additional actions, warnings or requests from the FDA or other regulatory bodies; our significant reliance on a limited number of products; potential disruptions in our limited supply chain for our products; a reduction in international distribution; actions of the FDA or other regulatory bodies that could delay, limit or suspend product development, manufacturing or sales; the effect of recalls, patient adverse events or deaths on our business; difficulties or delays in the development, production, manufacturing and marketing of new or existing products and services; changes in laws and regulations or in the interpretation or application of laws or regulations.

Further information on these and other factors that could affect the Company’s financial results is included in filings we make with the Securities and Exchange Commission from time to time. All forward-looking statements are based on information available to us on the date hereof, and we assume no obligation to update forward-looking statements.


IRADIMED CORPORATION
CONDENSED BALANCE SHEETS

September 30,
2021

December 31,
2020

(unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$

58,371,572

$

50,068,728

Investments

945,066

1,909,368

Accounts receivable, net

4,253,647

4,574,932

Inventory, net

4,433,389

3,933,987

Prepaid expenses and other current assets

685,449

771,666

Prepaid income taxes

2,899,939

2,477,211

Total current assets

71,589,062

63,735,892

Property and equipment, net

2,110,377

2,120,148

Intangible assets, net

1,054,641

960,885

Operating lease right-of-use asset

2,548,702

2,715,030

Deferred income taxes, net

870,028

1,272,672

Other assets

225,749

261,993

Total assets

$

78,398,559

$

71,066,620

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable

$

842,660

$

657,054

Accrued payroll and benefits

2,413,986

1,714,782

Other accrued taxes

91,254

103,981

Warranty reserve

111,007

90,054

Deferred revenue

2,442,430

1,949,259

Current portion of operating lease liability

272,498

255,698

Other current liabilities

146,435

146,435

Total current liabilities

6,320,270

4,917,263

Deferred revenue

1,910,668

2,305,413

Operating lease liability

2,276,204

2,459,332

Total liabilities

10,507,142

9,682,008

Stockholders’ equity:

Common stock

1,234

1,231

Additional paid-in capital

24,766,697

23,676,843

Retained earnings

43,102,255

37,669,451

Accumulated other comprehensive income

21,231

37,087

Total stockholders’ equity

67,891,417

61,384,612

Total liabilities and stockholders’ equity

$

78,398,559

$

71,066,620


IRADIMED CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)

Three Months Ended
September 30,

Nine Months Ended
September 30,

2021

2020

2021

2020

Revenue

$

10,907,302

$

7,699,096

$

29,941,721

$

23,171,329

Cost of revenue

2,501,745

1,958,036

7,141,547

6,036,353

Gross profit

8,405,557

5,741,060

22,800,174

17,134,976

Operating expenses:

General and administrative

2,252,274

2,196,935

7,247,262

10,062,089

Sales and marketing

2,585,702

2,282,491

7,434,603

7,090,192

Research and development

480,696

476,876

1,410,192

1,389,812

Total operating expenses

5,318,672

4,956,302

16,092,057

18,542,093

Income (loss) from operations

3,086,885

784,758

6,708,117

(1,407,117

)

Other income, net

7,143

9,352

14,675

125,706

Income (loss) before provision for income taxes

3,094,028

794,110

6,722,792

(1,281,411

)

Provision for income tax expense (benefit)

517,767

(280,536

)

1,289,988

(2,012,998

)

Net income

$

2,576,261

$

1,074,646

$

5,432,804

$

731,587

Net income per share:

Basic

$

0.21

$

0.09

$

0.44

$

0.06

Diluted

$

0.20

$

0.09

$

0.43

$

0.06

Weighted average shares outstanding:

Basic

12,331,062

12,243,362

12,318,476

12,071,027

Diluted

12,603,566

12,493,309

12,570,925

12,414,932


IRADIMED CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)

Nine Months Ended
September 30,

2021

2020

Operating activities:

Net income

$

5,432,804

$

731,587

Adjustments to reconcile net income to net cash provided by operating activities:

Change in allowance for doubtful accounts

(567

)

41,786

Change in provision for excess and obsolete inventory

51,731

29,209

Depreciation and amortization

1,020,223

999,812

Loss on disposal of property and equipment

1,066

Stock-based compensation

1,067,589

3,644,115

Deferred income taxes, net

414,095

310,329

Gain on maturities of investments

(13,005

)

(8,861

)

Changes in operating assets and liabilities:

Accounts receivable

321,852

2,999,188

Inventory

(344,721

)

(1,062,455

)

Prepaid expenses and other current assets

(663,408

)

(642,982

)

Other assets

23,447

(40,899

)

Accounts payable

(17,076

)

(468,615

)

Accrued payroll and benefits

699,204

(523,437

)

Other accrued taxes

(12,727

)

(473,380

)

Warranty reserve

20,953

5,298

Deferred revenue

313,381

119,658

Prepaid income taxes

(422,728

)

(2,335,105

)

Other

(3,820

)

Net cash provided by operating activities

7,892,113

3,321,428

Investing activities:

Proceeds from maturities of investments

950,000

480,000

Purchases of property and equipment

(391,303

)

(349,283

)

Capitalized intangible assets

(170,234

)

(184,281

)

Net cash provided by (used in) investing activities

388,463

(53,564

)

Financing activities:

Proceeds from exercises of stock options

85,615

1,722,721

Taxes paid related to net share settlement of equity awards

(63,347

)

(922,747

)

Net cash provided by financing activities

22,268

799,974

Net increase in cash and cash equivalents

8,302,844

4,067,838

Cash and cash equivalents, beginning of period

50,068,728

43,481,781

Cash and cash equivalents, end of period

$

58,371,572

$

47,549,619


IRADIMED CORPORATION
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED)

Non-GAAP Net Income and Diluted EPS

Three Months Ended
September 30,

Nine Months Ended
September 30,

2021

2020

2021

2020

Net income

$

2,576,261

$

1,074,646

$

5,432,804

$

731,587

Excluding:

Stock-based compensation expense, net of tax expense

273,175

315,507

805,998

1,070,897

Separation expenses, net of tax1

2,353,964

Non-GAAP net income

$

2,849,436

$

1,390,153

$

6,238,802

$

4,156,448

Weighted-average shares outstanding – diluted

12,603,566

12,493,309

12,570,925

12,414,932

Non-GAAP net income per share – diluted

$

0.23

$

0.11

$

0.50

$

0.33

1 Separation expenses recognized pursuant to a separation agreement as described in Exhibit 10.1 to Form 8-K filed with the Securities and Exchange Commission on June 16, 2020.


Free Cash Flow

Three Months Ended
September 30,

Nine Months Ended
September 30,

2021

2020

2021

2020

Net cash provided by operating activities

$

3,378,341

$

1,334,197

$

7,892,113

$

3,321,428

Less:

Purchases of property and equipment

150,760

48,725

391,303

349,283

Free cash flow

$

3,227,581

$

1,285,472

$

7,500,810

$

2,972,145


Media Contact:
Chris Scott
Chief Financial and Operating Officer
IRADIMED CORPORATION
(407) 677-8022
InvestorRelations@iradimed.com