iRadimed(US:IRMD)2022-11-03 11:00Part I Financial Information Condensed Financial Statements Unaudited condensed financial statements for Q3 and YTD 2022 show decreased assets and liabilities, strong revenue and net income growth, and a significant financing cash outflow Condensed Balance Sheets Total assets, liabilities, and equity decreased as of September 30, 2022, mainly due to reduced cash and cash equivalents Condensed Balance Sheet Highlights (in thousands) | Account | Sep 30, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $55,592 | $61,999 | | Accounts receivable, net | $10,651 | $5,137 | | Inventory, net | $5,243 | $4,300 | | Total Assets | $79,544 | $82,881 | | Liabilities & Equity | | | | Total current liabilities | $5,604 | $6,823 | | Total Liabilities | $9,773 | $10,708 | | Total Stockholders' Equity | $69,771 | $72,174 | Condensed Statements of Operations For Q3 and the nine months ended September 30, 2022, the company reported strong revenue and net income growth, alongside increased diluted earnings per share Key Operating Results (in thousands, except per share data) | Metric | Q3 2022 | Q3 2021 | 9 Months 2022 | 9 Months 2021 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $13,407 | $10,907 | $38,440 | $29,942 | | Gross Profit | $10,543 | $8,406 | $30,062 | $22,800 | | Income from Operations | $4,132 | $3,087 | $11,374 | $6,708 | | Net Income | $3,427 | $2,576 | $9,155 | $5,433 | | Diluted EPS | $0.27 | $0.20 | $0.72 | $0.43 | Condensed Statements of Cash Flows Operating cash flow decreased for the nine months ended September 30, 2022, with a significant financing cash outflow from a special dividend leading to a net cash decrease Cash Flow Summary for the Nine Months Ended Sep 30 (in thousands) | Cash Flow Activity | 2022 | 2021 | | :--- | :--- | :--- | | Net cash provided by operating activities | $7,004 | $7,892 | | Net cash (used in) provided by investing activities | $(903) | $388 | | Net cash (used in) provided by financing activities | $(12,508) | $22 | | Net (decrease) increase in cash | $(6,407) | $8,303 | - A special dividend of $12.6 million was paid to shareholders during the first three months of 2022, representing the primary use of cash in financing activities23111115 Notes to Unaudited Condensed Financial Statements The notes confirm the company operates in a single MRI compatible medical device segment, with U.S. and device sales driving revenue, and a planned land acquisition for future growth - The company operates in one reportable segment, focusing on the development, manufacture, and sale of MRI compatible medical devices and related accessories27 Revenue by Geographic Region (Nine Months Ended Sep 30) | Region | 2022 Revenue | 2021 Revenue | | :--- | :--- | :--- | | United States | $31,606,401 | $23,992,474 | | International | $6,833,150 | $5,949,247 | | Total | $38,439,551 | $29,941,721 | Revenue by Type (Nine Months Ended Sep 30) | Type | 2022 Revenue | 2021 Revenue | | :--- | :--- | :--- | | MRI Compatible Patient Vital Signs Monitoring Systems | $15,635,415 | $9,760,991 | | MRI Compatible IV Infusion Pump Systems | $11,001,490 | $9,329,182 | | Disposables, services and other | $10,158,922 | $9,412,091 | | Amortization of extended warranty agreements | $1,580,742 | $1,439,457 | - On November 1, 2022, the company agreed to purchase approximately 27 acres of land in Orlando, Florida, for $7.3 million to accommodate future growth65 Management's Discussion and Analysis of Financial Condition and Results of Operations Management reported strong Q3 revenue and gross margin growth, driven by device sales, with increased operating expenses, while maintaining strong liquidity despite a special dividend - The company is a leader in MRI compatible medical devices, providing a non-magnetic IV infusion pump system (MRidium®) and a patient vital signs monitoring system (IRADIMED 3880)6971 Q3 2022 Financial Highlights | Metric | Q3 2022 | Q3 2021 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $13.4M | $10.9M | 22.9% | | Net Income | $3.4M | $2.6M | 30.8% | | Diluted EPS | $0.27 | $0.20 | 35.0% | - Management expects higher revenue and operating expenses for the remainder of 2022 compared to the same period in 202175 Results of Operations Q3 and nine-month revenue and gross margin significantly increased, driven by device sales and price increases, while operating expenses also rose across categories - Q3 2022 revenue increased 22.9% YoY, driven by a 32.2% increase in device sales, with U.S. sales growing 24.6% and international sales growing 16.4%838485 - The average selling price (ASP) for the MRI compatible patient vital signs monitoring system increased to approximately $45,992 in Q3 2022 from $40,639 in Q3 2021, due to higher domestic sales and price increases87 - Q3 2022 gross profit margin increased to 78.6% from 77.1% in Q3 2021, primarily due to price increases implemented in late 2021 and a favorable standard cost update95 - Operating expenses increased in Q3 2022, with General & Administrative expenses up 27.9% and Sales & Marketing expenses up 17.5% compared to Q3 202199101 Liquidity and Capital Resources The company maintains strong liquidity with $55.6 million in cash, despite a $12.6 million special dividend, and expects sufficient funds for future operations and expansion - The company held $55.6 million in cash and investments as of September 30, 2022111 - A special dividend of $12.6 million was paid to shareholders in Q1 2022, causing a significant cash outflow from financing activities111115 - Management believes current cash and cash generated from operations will be sufficient for at least the next 12 months, including funding a planned land acquisition for expansion112 Quantitative and Qualitative Disclosures About Market Risk The company faces market risks from foreign currency and interest rate fluctuations, with the impact of a 10% Yen change and a 100 basis point interest rate change considered immaterial - The company has foreign currency risk related to costs denominated in Japanese Yen, but the potential impact on net income from exchange rate fluctuations is considered immaterial121 - The company is exposed to interest rate risk on its cash equivalents and investments, where a 100 basis point change in interest rates would result in an estimated $0.1 million change in the fair value of its investments as of September 30, 2022122 Controls and Procedures Management concluded that disclosure controls and procedures were effective as of September 30, 2022, 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 September 30, 2022124 - No changes occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting125 Part II Other Information Legal Proceedings Management believes that the resolution of any currently known legal proceedings will not materially affect the company's financial position or results of operations - Management believes that the resolution of any currently known legal proceedings will not have a material effect on the company's results of operations or financial position128 Risk Factors No material changes have been made to the risk factors disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2021 - No material changes have been made to the risk factors disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2021129 Unregistered Sale of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities during the period - There were no unregistered sales of equity securities during the period130 Exhibits This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files