iRadimed(IRMD) - 2025 Q1 - Quarterly Report

Cautionary Note Regarding Forward-Looking Statements This report contains forward-looking statements, subject to numerous risks and uncertainties that could cause actual results to differ materially - This report contains forward-looking statements, subject to numerous risks and uncertainties that could cause actual results to differ materially[8] - Key risks include FDA 510(k) clearance, reliance on limited products, supply chain integrity, competition, regulatory changes, and geopolitical impacts[8][10][13] - The company disclaims any obligation to update forward-looking statements, advising readers to consider detailed risks in this 10-Q and 2024 Annual Report on Form 10-K[11] Part I: Financial Information Item 1: Financial Statements Unaudited Q1 2025 financials reflect asset growth, 11% revenue increase, and strong net income, with robust operating cash flow Condensed Balance Sheets Total assets increased by March 31, 2025, primarily due to property and equipment investments, with stockholders' equity also growing Condensed Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $50,331 | $52,234 | | Total current assets | $75,137 | $75,242 | | Property and equipment, net | $20,378 | $16,811 | | Total assets | $101,729 | $98,326 | | Liabilities & Equity | | | | Total current liabilities | $8,473 | $8,512 | | Total liabilities | $11,675 | $11,507 | | Total stockholders' equity | $90,054 | $86,819 | | Total liabilities and stockholders' equity | $101,729 | $98,326 | Condensed Statements of Operations Q1 2025 saw an 11% revenue increase, with gross profit rising and net income growing 13.3%, leading to higher diluted EPS Q1 2025 vs Q1 2024 Statement of Operations (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | $19,511 | $17,598 | 10.9% | | Gross Profit | $14,843 | $13,388 | 10.9% | | Income from Operations | $5,431 | $4,748 | 14.4% | | Net Income | $4,687 | $4,137 | 13.3% | | Diluted EPS | $0.37 | $0.32 | 15.6% | Condensed Statements of Stockholders' Equity Stockholders' equity increased in Q1 2025, primarily driven by net income and partially offset by declared dividends - Key changes in stockholders' equity for Q1 2025 include net income of $4.7 million, dividends declared of $2.2 million, and stock-based compensation expense of $0.8 million[20] Condensed Statements of Cash Flows Q1 2025 cash flows show strong operating cash, significant investment in property, and cash used for financing, resulting in a net decrease Q1 2025 vs Q1 2024 Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $4,292 | $3,883 | | Net cash used in investing activities | ($3,917) | ($479) | | Net cash used in financing activities | ($2,278) | ($8,040) | | Net decrease in cash | ($1,903) | ($4,636) | - The significant increase in cash used for investing activities in Q1 2025 is attributed to $3.7 million in purchases of property and equipment, compared to just $0.3 million in Q1 2024[23] - Cash used in financing activities decreased significantly year-over-year, as Q1 2024 included a large special dividend payment of nearly $8.0 million, compared to the regular quarterly dividend of $2.2 million in Q1 2025[23] Notes to Unaudited Condensed Financial Statements Notes confirm single segment, detail U.S. revenue growth, international decline, ongoing IRS examination, and a declared quarterly dividend Revenue Breakdown by Geography and Type (Q1 2025 vs Q1 2024, in thousands) | Revenue Category | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | By Geography | | | | | United States | $15,953 | $13,409 | 19.0% | | International | $3,558 | $4,189 | (15.1%) | | By Type | | | | | Total Devices | $12,962 | $11,904 | 8.9% | | Disposables | $4,947 | $4,014 | 23.2% | - The company is currently under an IRS examination for the tax year ended December 31, 2021, but has not accounted for any proposed adjustments[49] - On May 5, 2025, the Board of Directors declared a regular quarterly cash dividend of $0.17 per share, payable on May 30, 2025[58] Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations Management attributes Q1 2025 revenue growth to strong U.S. demand, maintaining stable gross margins despite rising operating expenses, and anticipates continued fiscal 2025 growth - The company is a leader in MRI compatible medical devices, including its non-magnetic MRidium® IV infusion pump system, the 3880 patient vital signs monitoring system, and the 3600 ferromagnetic detection device[61][63][64] - For the remainder of fiscal year 2025, the company anticipates higher revenue compared to 2024, driven by increased sales across its product lines, and expects higher operating expenses in sales, marketing, regulatory, and G&A areas[69] Results of Operations Q1 2025 revenue increased 11% driven by U.S. sales growth, offsetting international decline, with stable gross margins and varied operating expense changes Revenue by Type (Q1 2025 vs Q1 2024, in millions) | Revenue Type | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Devices | $13.0 | $11.9 | 9% | | Disposables | $4.9 | $4.0 | 23% | | Services and other | $1.0 | $1.2 | (13%) | | Total Revenue | $19.5 | $17.6 | 11% | - General and administrative expenses increased by 15% to $4.6 million, primarily due to higher legal, professional, and payroll expenses[84] - Research and development expenses decreased by 25% to $0.6 million, mainly due to a reduction in the purchase of prototype materials[86] Liquidity and Capital Resources The company maintains strong liquidity with substantial cash and working capital, with operating cash flow supporting investments and dividends, and a shelf registration available - The company has a shelf registration statement on Form S-3, effective May 8, 2024, allowing for the sale of up to $75.0 million of its common stock, with the full amount remaining available as of March 31, 2025[93] - Cash used in investing activities increased to $3.9 million in Q1 2025 from $0.5 million in Q1 2024, primarily due to construction costs for a new facility[96] - The company commenced a regular quarterly dividend in 2024, in addition to a special dividend paid in March 2024[97] Item 3: Quantitative and Qualitative Disclosures About Market Risk No material changes in market risks have occurred since the 2024 Annual Report on Form 10-K - There have been no material changes in market risks since the 2024 Annual Report[103] Item 4: Controls and Procedures Management concluded disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[105] - No changes to internal control over financial reporting occurred during the quarter that would have a material effect[106] Part II: Other Information Item 1: Legal Proceedings The company is not currently party to any legal proceedings expected to have a material adverse effect on its operations - The company may become party to legal proceedings in the ordinary course of business but does not believe any known matters will have a material adverse effect[108] Item 1A: Risk Factors No material changes to risk factors from the 2024 Annual Report, except for expanded discussion on potential adverse effects of changing trade policies and tariffs - A key risk factor highlighted is the uncertainty and potential adverse impact of changes in trade policies, such as tariffs imposed by the U.S. and retaliatory measures by other countries[110] - Tariffs could increase the cost of sourced materials, impact product pricing, and potentially reduce sales and profitability, making the company susceptible to trade disputes due to global sales and sourcing[111] Item 2: Unregistered Sale of Equity Securities and Use of Proceeds No unregistered sales of equity securities occurred during the period - None[113] Item 3: Default Upon Senior Securities Not applicable - Not Applicable[114] Item 4: Mine Safety Disclosures Not applicable - Not Applicable[115] Item 5: Other Information No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during Q1 2025 - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement during the quarter ended March 31, 2025[116] Item 6: Exhibits The report lists various exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files - Key exhibits include CEO and CFO certifications (31.1, 31.2, 32.1) and Inline XBRL documents (101 series)[117]