IRADIMED CORPORATION Announces Second Quarter 2019 Financial Results
IRADIMED CORPORATION Announces Second Quarter 2019 Financial Results
Reports second quarter 2019 revenue of $9.2 million
Reports second quarter 2019 GAAP diluted EPS of $0.17 and non-GAAP diluted EPS of $0.20
Updates full year earnings guidance
Winter Springs, Florida, July 30, 2019 – IRADIMED CORPORATION (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 system that are designed for use during MRI procedures, today announced financial results for the three and six months ended June 30, 2019.
For the second quarter ended June 30, 2019, the Company reported revenue of $9.2 million compared to $7.4 million for the second quarter 2018. Net income was $2.1 million, or $0.17 per diluted share, compared to net income of $1.4 million, or $0.11 per diluted share for the second quarter 2018. Gross profit margin was 79.9 percent, compared to 76.8 percent for the second quarter 2018. Domestic sales were 82.0 percent of total revenue, compared to 77.7 percent for the second quarter 2018. Revenue from sales of our 3880 MRI compatible patient vital signs monitoring system was $1.8 million for the second quarter 2019 compared to $1.5 million for the second quarter 2018.
Non-GAAP net income was $2.4 million for the quarter ended June 30, 2019, which excludes $0.4 million of stock compensation expense, net of tax. Non-GAAP net income for the quarter ended June 30, 2018 was $1.7 million, which excludes $0.3 million of stock compensation expense, net of tax. Non-GAAP earnings per diluted share was $0.20, compared to $0.14 for the second quarter 2018. Free cash flow was $2.4 million, compared to $1.5 million for the second quarter 2018.
For the six months ended June 30, 2019, the Company reported revenue of $17.7 million compared to $14.5 million for the same period in 2018. Net income was $3.9 million, or $0.32 per diluted share, compared to net income of $2.2 million, or $0.18 per diluted share for the same period in 2018. Gross profit margin was 77.9 percent, compared to 76.5 percent for the same period in 2018. Domestic sales were 82.9 percent of total revenue, compared to 80.8 percent for the same period in 2018. Revenue from sales of our 3880 MRI compatible patient vital signs monitoring system was $3.6 million for the six months ended June 30, 2019 compared to $2.7 million for the same period in 2018.
Non-GAAP net income was $4.0 million for the six months ended June 30, 2019, which excludes $0.6 million of stock compensation expense, net of tax and a $0.6 million reduction to non-GAAP net income resulting from an infrequent tax item related to excess tax benefits recognized in the provision for income taxes for the exercise and sale of certain incentive stock options. Non-GAAP net income for the six months ended June 30, 2018 was $2.8 million, which excludes $0.6 million of stock compensation expense, net of tax. Non-GAAP earnings per diluted share for the six months ended June 30, 2019 was $0.33, compared to $0.24 for the same period in 2018. Free cash flow was consistent at $3.0 million for each of the six-month periods ended June 30, 2019 and 2018.
As of June 30, 2019, the Company had combined cash and investments of $37.8 million.
“It is very satisfying announcing our second quarter results, which continue to confirm the acceptance of our exclusive products in the marketplace. We look forward to continuing on this growth path and accelerating as we penetrate deeper into our target markets and focusing more intensely on commercializing new products,” said Roger Susi, President and Chief Executive Officer of the Company.
This financial guidance includes the expected impact of our CE Mark expiration as announced on January 22, 2019. The updated earnings guidance reflects the impact of the costs associated with Leslie McDonnell, our new CEO, as announced on July 29, 2019.
The Company maintains its full year 2019 guidance and expects to report revenue of $38.5 million to $39.5 million.
The Company updated its full year earnings guidance and now expects GAAP diluted earnings per share of $0.65 to $0.69 and non-GAAP diluted earnings per share of $0.70 to $0.74. The Company’s previous full year guidance called for GAAP diluted earnings per share of $0.60 to $0.64 and non-GAAP diluted earnings per share of $0.69 to $0.73. Costs associated with our new CEO are expected to negatively impact full-year GAAP diluted earnings per share by $(0.03) and non-GAAP diluted earnings by $(0.02).
For the third quarter 2019, the Company expects to report revenue of $9.7 million to $10.0 million, GAAP diluted earnings per share of $0.12 to $0.14 and non-GAAP diluted earnings per share of $0.14 to $0.16. Costs associated with our new CEO are expected to negatively impact third quarter GAAP diluted earnings per share by $(0.01). We expect an insignificant impact to non-GAAP diluted earnings related to these costs.
For the full year ending December 31, 2019, the Company’s non-GAAP earnings per share guidance excludes stock-based compensation expense, net of tax, and an infrequent tax item, which the Company expects to be approximately $1.4 million and $(0.6) million, respectively. For the third quarter 2019, the Company’s non-GAAP earnings per share guidance excludes stock-based compensation expense, net of tax of $0.3 million.
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 GAAP. We calculate non-GAAP net income as net income excluding 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. 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 via share repurchases. 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. All of our non-GAAP financial measures are important tools for financial and operational decision making and for evaluating our 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.
IRADIMED has scheduled a conference call to discuss this announcement beginning at 11:00 a.m. Eastern Time today, July 30, 2019. 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 7498872.
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; non-invasive blood pressure; 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.
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, receive FDA 510(k) clearance for new products; 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 by or requests from the FDA; our significant reliance on a single product; unexpected costs, expenses and diversion of management attention resulting from the FDA warning letter; 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.
Chief Financial Officer