iRadimed(IRMD) - 2024 Q2 - Quarterly Report

Part I. Financial Information This section presents the company's unaudited condensed financial statements and management's discussion and analysis for the three and six months ended June 30, 2024 Item 1. Financial Statements This section presents the unaudited condensed financial statements for the three and six months ended June 30, 2024, including balance sheets, statements of operations, stockholders' equity, and cash flows, with accompanying notes Condensed Balance Sheets This section provides a summary of the company's financial position as of June 30, 2024, compared to December 31, 2023 Condensed Balance Sheet Summary | Balance Sheet Item | June 30, 2024 (Unaudited) | December 31, 2023 (Audited) | | :--- | :--- | :--- | | Total Assets | $89,949,347 | $92,156,098 | | Total Current Assets | $73,578,234 | $76,001,112 | | Total Liabilities | $10,277,858 | $20,735,934 | | Total Current Liabilities | $7,458,293 | $16,327,306 | | Total Stockholders' Equity | $79,671,489 | $71,420,164 | - Total liabilities decreased significantly from $20.7 million at year-end 2023 to $10.3 million as of June 30, 2024, primarily due to the payment of a dividend payable of approximately $8.0 million[11] Condensed Statements of Operations and Comprehensive Income This section details the company's financial performance for the three and six months ended June 30, 2024, including revenue, gross profit, operating income, and net income Q2 2024 vs Q2 2023 Performance | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $17,928,876 | $16,130,396 | +11.2% | | Gross Profit | $14,009,593 | $12,186,492 | +15.0% | | Income from Operations | $5,627,043 | $4,963,035 | +13.4% | | Net Income | $4,901,224 | $4,179,840 | +17.3% | | Diluted EPS | $0.38 | $0.33 | +15.2% | YTD 2024 vs YTD 2023 Performance | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $35,526,995 | $31,605,480 | +12.4% | | Gross Profit | $27,397,316 | $23,907,945 | +14.6% | | Income from Operations | $10,375,390 | $8,970,285 | +15.7% | | Net Income | $9,037,757 | $7,585,910 | +19.1% | | Diluted EPS | $0.71 | $0.60 | +18.3% | Condensed Statements of Stockholders' Equity This section outlines changes in the company's stockholders' equity for the six months ended June 30, 2024 - Total Stockholders' Equity increased from $71.4 million at the end of 2023 to $79.7 million as of June 30, 2024, driven by a net income of $9.0 million, partially offset by dividends paid of $1.9 million in Q2 2024[15] Condensed Statements of Cash Flows This section summarizes the company's cash inflows and outflows from operating, investing, and financing activities for the six months ended June 30, 2024 Cash Flow Summary (Six Months Ended June 30) | Cash Flow Activity | 2024 | 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $10,521,680 | $8,159,848 | | Net cash used in investing activities | ($1,748,573) | ($6,935,328) | | Net cash used in financing activities | ($10,000,165) | ($13,362,551) | | Net decrease in cash | ($1,227,058) | ($12,138,031) | | Cash and cash equivalents, end of period | $48,535,140 | $45,822,833 | - Cash used in investing activities decreased significantly year-over-year, as the 2023 period included a $6.2 million land acquisition for a future facility[18][79][80] - Cash used in financing activities decreased due to lower dividend payments in 2024 ($9.9 million) compared to 2023 ($13.2 million)[18][79][80] Notes to Unaudited Condensed Financial Statements The notes detail the basis of presentation, revenue disaggregation, inventory and asset composition, lease agreements, and subsequent events Revenue by Geography (Three Months Ended June 30) | Region | 2024 | 2023 | Change | | :--- | :--- | :--- | :--- | | United States | $15,485,216 | $12,949,526 | +19.6% | | International | $2,443,660 | $3,180,870 | -23.2% | | Total | $17,928,876 | $16,130,396 | +11.2% | Revenue by Type (Three Months Ended June 30) | Product/Service | 2024 | 2023 | Change | | :--- | :--- | :--- | :--- | | MRI Compatible IV Infusion Pump Systems | $6,881,199 | $4,522,568 | +52.1% | | MRI Compatible Patient Vital Signs Monitoring Systems | $5,450,224 | $6,128,718 | -11.1% | | Disposables, services and other | $4,662,863 | $4,815,870 | -3.2% | - On May 29, 2024, the company amended its headquarters lease with Susi, LLC, extending it to May 31, 2025, which reduced the Right-of-Use asset and liability by $1.48 million[40][41] - Subsequent to the quarter's end, on July 31, 2024, the Board of Directors declared a regular quarterly cash dividend of $0.15 per share, payable on August 30, 2024[47] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the financial results for Q2 2024, highlighting an 11.2% year-over-year revenue increase to $17.9 million, driven by strong domestic sales of the IV Infusion Pump System, improved gross margin, and a strong liquidity position Results of Operations For Q2 2024, revenue grew 11.2% to $17.9 million, driven by a 20.2% increase in U.S. sales, with gross profit margin expanding to 78.1% due to lower raw material costs and favorable sales mix, while operating expenses increased by 16.0% - Revenue growth in Q2 2024 was primarily driven by a 20.2% increase in U.S. sales, reaching $15.5 million, while international sales decreased by 25.0% to $2.4 million[62] - Gross profit margin for Q2 2024 increased to 78.1% from 75.5% in Q2 2023, attributed to decreased raw material costs, direct labor efficiencies, and a favorable geographic sales mix[67] - General and administrative expenses for Q2 2024 rose 24.2% to $4.1 million, mainly due to higher regulatory, legal, and professional expenses, along with increased payroll[70] - Sales and marketing expenses increased by 20.7% to $3.5 million in Q2 2024, driven by higher sales commissions, sales activities, and payroll expenses[71] Liquidity and Capital Resources As of June 30, 2024, the company maintained a strong liquidity position with $48.5 million in cash and cash equivalents and $66.1 million in working capital, sufficient to meet operating requirements for at least the next 12 months Key Liquidity Metrics | Metric | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $48.5 million | $49.8 million | | Working capital | $66.1 million | $59.7 million | | Stockholders' equity | $79.7 million | $71.4 million | - The company plans to use available cash to construct a new corporate office and manufacturing facility to accommodate increased operations and expand capacity[41][78] - On May 8, 2024, a shelf registration statement on Form S-3 became effective, allowing the company to offer, issue, and sell up to $75.0 million of its common stock[77] Item 3. Quantitative and Qualitative Disclosures about Market Risk The company reports no material changes in its market risks from those disclosed in its Annual Report on Form 10-K for the fiscal year ended December 31, 2023 - There have been no material changes in the company's market risks since the 2023 Annual Report[84] Item 4. Controls and Procedures Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2024, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2024[85] - There were no changes in internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[86] Part II. Other Information This section covers legal proceedings, risk factors, other required disclosures, and a list of exhibits filed with the report Item 1. Legal Proceedings The company is not party to any legal proceedings expected to have a material adverse effect on its business, maintaining an accrual of approximately $250,000 for ordinary course matters - The company does not believe any current legal matters will have a material adverse effect on its business, financial condition, or cash flows[87] - As of June 30, 2024, the company had accrued approximately $250,000 related to various legal matters[46][87] Item 1A. Risk Factors There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2023 - There have been no material changes in the company's risk factors from those described in the 2023 Annual Report[88] Item 2-5. Other Required Disclosures This section confirms no unregistered sales of equity securities, no defaults on senior securities, no applicable mine safety disclosures, and no Rule 10b5-1 trading arrangement adoptions or terminations by directors or officers - The report indicates 'None' for Unregistered Sale of Equity Securities and Use of Proceeds[88] - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement during the quarterly period ended June 30, 2024[88] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including an amended lease agreement, CEO and CFO certifications, and Inline XBRL financial data files - Filed exhibits include an amendment to the Susi, LLC Lease Agreement, CEO and CFO certifications (Sections 302 and 906), and Inline XBRL documents[90]