SANUWAVE Health Inc(SNWV) - 2023 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - In Q1 2023, revenue amounted to $3.8 million, representing an 18% increase compared to the same period last year, aligning with the guidance of 14% to 20% growth [9][10] - Gross margin decreased to 67% in Q1 2023 from 72% in Q1 2022 due to cost increases associated with servicing refurbished equipment [7][10] - Operating expenses increased by 4.7% year over year, totaling $4.5 million, primarily due to higher general and administrative expenses [9][10] Business Line Data and Key Metrics Changes - The number of treatments reached a record 43,000 in Q1 2023, indicating continued adoption of Ultramist [7] - Units shipped achieved the highest level for the first quarter in company history, reflecting robust demand despite supply chain challenges [7] Market Data and Key Metrics Changes - Demand for products remains strong, with over 20 new accounts added to the pipeline following recent conferences [6] - The company is on track to receive over 400 devices in 2023, compared to 217 sold last year, although it is uncertain if all will be sold [5] Company Strategy and Development Direction - The company is focused on addressing supply chain issues to balance supply and demand, with initiatives aimed at improving automation and reducing costs [8][16] - Management plans to leverage existing infrastructure for profitable growth and aims to achieve record revenue growth and profitability in 2023 [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in overcoming supply constraints, indicating that the issues are primarily related to Ultramist production [23] - The company anticipates revenue growth of 15% to 25% in Q2 2023, contingent on supply chain improvements [15] Other Important Information - The company closed an additional private placement in May 2023, raising $1.2 million to support operations [10] - Management emphasized the importance of strong reimbursement channels for Ultramist across various service settings, enhancing market opportunities [20] Q&A Session Summary Question: Can you expand on the reimbursement situation for Ultramist? - Ultramist has strong reimbursement in multiple settings, including hospitals, private offices, home health, assisted living facilities, and nursing homes, providing diverse channels for growth [20] Question: Are the supply constraints expected to be prolonged? - Supply constraints are primarily around Ultrimist, but management is confident that these issues will not last a year and are working to ensure a consistent supply [23] Question: Will operating cost increases be a recurring issue? - The increase in operating costs is largely due to one-time professional service fees related to SEC initiatives, and overall operating expenses are increasing at a slower rate compared to revenue [29]