InfuSystem Reports Second Quarter 2024 Financial Results
Record Net Revenues of
Reaffirms Full-Year 2024 Guidance
2024 Second Quarter Overview:
-
Net revenues totaled
$33.7 million , an increase of 6% vs. prior year.-
Patient Services net revenue was
$20.2 million , an increase of 5% vs. prior year. -
Device Solutions net revenue was
$13.5 million , an increase of 8% vs. prior year.
-
Patient Services net revenue was
-
Gross profit was
$16.7 million , an increase of 5% vs. prior year. -
Gross margin was 49.5%, a slight decrease of 0.4% vs. prior year.
- Patient Services gross margin was 66.4%, an increase of 5.1% vs. prior year.
- Device Solutions gross margin was 24.0%, a decrease of 8.1% vs. prior year.
-
Net income increased 64.8% to
$0.7 million , or$0.03 per diluted share vs. prior year net income of$0.4 million , or$0.02 per diluted share. -
Adjusted earnings before interest, income taxes, depreciation, and amortization (“Adjusted EBITDA”) (non-GAAP) was
$6.1 million , an increase of 5% vs. prior year. - Adjusted EBITDA margin was 18.0% vs. 18.2% prior year.
-
Net operating cash flow was up 17% to
$2.7 million , as ofJune 30, 2024 . -
Company liquidity totaled
$40.5 million , as ofJune 30, 2024 .
Management Discussion
“We are continuing to identify and implement strategic partnerships that we believe will grow and diversify our business. Most recently, this included entering into a new distribution agreement with Smith+Nephew, a global leader in medical technology. This collaboration expands our portfolio of medical equipment and increases our opportunities in wound care.
As we look ahead, we see momentum building into the second half of this year and into 2025. In Patient Services, Oncology continues to be strong, we continue to make progress in developing Wound Care, and Pain Management is ready for reimbursement to come through the NOPAIN Act. Device Solutions secured a new pump rental business win and in biomedical services, we undertook a significant device remediation project for one of our important partners, a large medical device manufacturer. We remain focused on enhancing our margin and profitability profile. We believe we are well positioned for sustainable long-term growth and profitability in the coming quarters and years,” concluded
2024 Second Quarter Financial Review
Net revenues for the quarter ended
Patient Services net revenue of
Device Solutions net revenue of
Gross profit for the second quarter of 2024 of
Patient Services gross profit was
Device Solutions gross profit during the second quarter of 2024 was
Selling and marketing expenses were
General and administrative (“G&A”) expenses for the second quarter of 2024 were
Net income for the second quarter of 2024 was
Adjusted EBITDA, a non-GAAP measure, for the second quarter of 2024 was
Balance sheet, cash flows and liquidity
During the six-month period ended
As of
Full Year 2024 Guidance
The full year 2024 guidance reflects management’s current expectation for operational performance, given the current market conditions. This includes our best estimate of revenue and Adjusted EBITDA. These estimates now include expected expenses related to planned upgrades of the Company's information technology and business applications. Our previous guidance excluded these amounts. The Company and its businesses are subject to certain risks, including those risk factors discussed in our most recent annual report on Form 10-K for the year ended
Conference Call
The Company will conduct a conference call for all interested investors on
To participate in this call, please dial (833) 366-1127 or (412) 902-6773, or listen via a live webcast, which is available in the Investors section of the Company’s website at https://ir.infusystem.com/. A replay of the call will be available by visiting https://ir.infusystem.com/ for the next 90 days or by calling (877) 344-7529 or (412) 317-0088, replay access code 6530466, through
Non-GAAP Measures
This press release contains information prepared in conformity with GAAP as well as non-GAAP financial information. Non-GAAP financial measures presented in this press release include EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, net debt and Adjusted EBITDA to net debt ratio. The Company believes that the non-GAAP financial measures presented in this press release provide useful information to the Company’s management, investors and other interested parties about the Company’s operating performance because they allow them to understand and compare the Company’s operating results during the current periods to the prior year periods in a more consistent manner. This non-GAAP information should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP, and similarly titled non-GAAP measures may be calculated differently by other companies. The Company calculates those non-GAAP measures by adjusting for non-recurring or non-core items that are not part of the normal course of business. A reconciliation of those measures to the most directly comparable GAAP measures is provided in the accompanying schedule, titled "GAAP to Non-GAAP Reconciliation" below. Future period non-GAAP guidance includes adjustments for items not indicative of our core operations, which may include, without limitation, items included in the accompanying schedule below. Such adjustments may be affected by changes in ongoing assumptions and judgments, as well as non-core, nonrecurring, unusual or unanticipated changes, expenses or gains or other items that may not directly correlate to the underlying performance of our business operations. The exact amounts of these adjustments are not currently determinable but may be significant. It is therefore not practicable to provide the comparable GAAP measures or reconcile this non-GAAP guidance to the most comparable GAAP measures and, therefore, such comparable GAAP measures and reconciliations are excluded from this release in reliance upon applicable
About
Forward-Looking Statements
The financial results in this press release reflect preliminary results, which are not final until the Company’s quarterly report on Form 10-Q for the quarter year ended
Additional information about
FINANCIAL TABLES FOLLOW
|
|||||||||||||||
|
|||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
(UNAUDITED) |
|||||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(in thousands, except share and per share data) |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
||||||||
Net revenues |
$ |
33,698 |
|
|
$ |
31,735 |
|
|
$ |
65,693 |
|
|
$ |
62,105 |
|
Cost of revenues |
|
17,030 |
|
|
|
15,903 |
|
|
|
32,551 |
|
|
|
31,323 |
|
Gross profit |
|
16,668 |
|
|
|
15,832 |
|
|
|
33,142 |
|
|
|
30,782 |
|
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative expenses: |
|
|
|
|
|
|
|
||||||||
Amortization of intangibles |
|
247 |
|
|
|
247 |
|
|
|
495 |
|
|
|
495 |
|
Selling and marketing |
|
3,042 |
|
|
|
2,985 |
|
|
|
6,418 |
|
|
|
6,209 |
|
General and administrative |
|
11,524 |
|
|
|
11,352 |
|
|
|
25,219 |
|
|
|
22,937 |
|
|
|
|
|
|
|
|
|
||||||||
Total selling, general and administrative |
|
14,813 |
|
|
|
14,584 |
|
|
|
32,132 |
|
|
|
29,641 |
|
|
|
|
|
|
|
|
|
||||||||
Operating income |
|
1,855 |
|
|
|
1,248 |
|
|
|
1,010 |
|
|
|
1,141 |
|
Other expense: |
|
|
|
|
|
|
|
||||||||
Interest expense |
|
(484 |
) |
|
|
(620 |
) |
|
|
(940 |
) |
|
|
(1,104 |
) |
Other (expense) income |
|
(63 |
) |
|
|
2 |
|
|
|
(60 |
) |
|
|
(33 |
) |
|
|
|
|
|
|
|
|
||||||||
Income before income taxes |
|
1,308 |
|
|
|
630 |
|
|
|
10 |
|
|
|
4 |
|
(Provision for) benefit from income taxes |
|
(591 |
) |
|
|
(195 |
) |
|
|
(405 |
) |
|
|
107 |
|
Net income (loss) |
$ |
717 |
|
|
$ |
435 |
|
|
$ |
(395 |
) |
|
$ |
111 |
|
Net income (loss) per share: |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
0.03 |
|
|
$ |
0.02 |
|
|
$ |
(0.02 |
) |
|
$ |
0.01 |
|
Diluted |
$ |
0.03 |
|
|
$ |
0.02 |
|
|
$ |
(0.02 |
) |
|
$ |
0.01 |
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
||||||||
Basic |
|
21,299,089 |
|
|
|
20,955,048 |
|
|
|
21,262,429 |
|
|
|
20,904,315 |
|
Diluted |
|
21,711,198 |
|
|
|
21,600,346 |
|
|
|
21,262,429 |
|
|
|
21,565,667 |
|
|
||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||
SEGMENT REPORTING |
||||||||||||
(UNAUDITED) |
||||||||||||
|
|
Three Months Ended
|
|
Better/ (Worse) |
||||||||
(in thousands) |
|
|
2024 |
|
|
|
2023 |
|
|
|||
|
|
|
|
|
|
|
||||||
Net revenues: |
|
|
|
|
|
|
||||||
Patient Services |
|
$ |
20,246 |
|
|
$ |
19,319 |
|
|
$ |
927 |
|
Device Solutions |
|
|
15,194 |
|
|
|
14,097 |
|
|
|
1,097 |
|
Less: elimination of inter-segment revenues (a) |
|
|
(1,742 |
) |
|
|
(1,681 |
) |
|
|
(61 |
) |
Total Device Solutions |
|
|
13,452 |
|
|
|
12,416 |
|
|
|
1,036 |
|
Total |
|
|
33,698 |
|
|
|
31,735 |
|
|
|
1,963 |
|
Gross profit: |
|
|
|
|
|
|
||||||
Patient Services |
|
|
13,444 |
|
|
|
11,845 |
|
|
|
1,599 |
|
Device Solutions |
|
|
3,224 |
|
|
|
3,987 |
|
|
|
(763 |
) |
Total |
|
$ |
16,668 |
|
|
$ |
15,832 |
|
|
$ |
836 |
|
(a) |
Inter-segment allocations are for cleaning and repair services performed on medical equipment. |
|
|
Six Months Ended
|
|
Better/ (Worse) |
||||||||
(in thousands) |
|
|
2024 |
|
|
|
2023 |
|
|
|||
|
|
|
|
|
|
|
||||||
Net revenues: |
|
|
|
|
|
|
||||||
Patient Services |
|
$ |
38,837 |
|
|
$ |
38,093 |
|
|
$ |
744 |
|
Device Solutions |
|
|
30,311 |
|
|
|
27,323 |
|
|
|
2,988 |
|
Less: elimination of inter-segment revenues (a) |
|
|
(3,455 |
) |
|
|
(3,311 |
) |
|
|
(144 |
) |
Total Device Solutions |
|
|
26,856 |
|
|
|
24,012 |
|
|
|
2,844 |
|
Total |
|
|
65,693 |
|
|
|
62,105 |
|
|
|
3,588 |
|
Gross profit: |
|
|
|
|
|
|
||||||
Patient Services |
|
|
25,718 |
|
|
|
23,386 |
|
|
|
2,332 |
|
Device Solutions |
|
|
7,424 |
|
|
|
7,396 |
|
|
|
28 |
|
Total |
|
$ |
33,142 |
|
|
$ |
30,782 |
|
|
$ |
2,360 |
(a) |
Inter-segment allocations are for cleaning and repair services performed on medical equipment. |
|
||||||||||||||||
GAAP TO NON-GAAP RECONCILIATION |
||||||||||||||||
(UNAUDITED) |
||||||||||||||||
|
||||||||||||||||
NET INCOME (LOSS) TO EBITDA, ADJUSTED EBITDA, NET INCOME (LOSS) MARGIN AND ADJUSTED EBITDA MARGIN: |
||||||||||||||||
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(in thousands) |
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP net income (loss) |
|
$ |
717 |
|
|
$ |
435 |
|
|
$ |
(395 |
) |
|
$ |
111 |
|
Adjustments: |
|
|
|
|
|
|
|
|
||||||||
Interest expense |
|
|
484 |
|
|
|
620 |
|
|
|
940 |
|
|
|
1,104 |
|
Income tax provision (benefit) |
|
|
591 |
|
|
|
195 |
|
|
|
405 |
|
|
|
(107 |
) |
Depreciation |
|
|
2,786 |
|
|
|
2,846 |
|
|
|
5,438 |
|
|
|
5,801 |
|
Amortization |
|
|
247 |
|
|
|
247 |
|
|
|
495 |
|
|
|
495 |
|
|
|
|
|
|
|
|
|
|
||||||||
Non-GAAP EBITDA |
|
$ |
4,825 |
|
|
$ |
4,343 |
|
|
$ |
6,883 |
|
|
$ |
7,404 |
|
|
|
|
|
|
|
|
|
|
||||||||
Stock compensation costs |
|
|
998 |
|
|
|
1,016 |
|
|
|
2,055 |
|
|
|
1,736 |
|
Medical equipment reserve and disposals (1) |
|
|
231 |
|
|
|
336 |
|
|
|
127 |
|
|
|
766 |
|
Management reorganization/transition costs |
|
|
— |
|
|
|
72 |
|
|
|
108 |
|
|
|
72 |
|
Cooperation Agreement payment and associated legal expenses |
|
|
— |
|
|
|
— |
|
|
|
649 |
|
|
|
— |
|
Certain other non-recurring costs |
|
|
20 |
|
|
|
(6 |
) |
|
|
109 |
|
|
|
18 |
|
|
|
|
|
|
|
|
|
|
||||||||
Non-GAAP Adjusted EBITDA |
|
$ |
6,074 |
|
|
$ |
5,761 |
|
|
$ |
9,931 |
|
|
$ |
9,996 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP Net Revenues |
|
$ |
33,698 |
|
|
$ |
31,735 |
|
|
$ |
65,693 |
|
|
$ |
62,105 |
|
Net Income (Loss) Margin (2) |
|
|
2.1 |
% |
|
|
1.4 |
% |
|
|
(0.6 |
)% |
|
|
0.2 |
% |
Non-GAAP Adjusted EBITDA Margin (3) |
|
|
18.0 |
% |
|
|
18.2 |
% |
|
|
15.1 |
% |
|
|
16.1 |
% |
(1) |
Amounts represent a non-cash (recovery) expense recorded to adjust the reserve for missing medical equipment and is being (deducted) added back due to its similarity to depreciation. |
|
(2) |
Net Income (Loss) Margin is defined as GAAP Net Income (Loss) as a percentage of GAAP Net Revenues. |
|
(3) |
Non-GAAP Adjusted EBITDA Margin is defined as Non-GAAP Adjusted EBITDA as a percentage of GAAP Net Revenues. |
|
||||||||
CONSOLIDATED BALANCE SHEETS |
||||||||
(UNAUDITED) |
||||||||
|
|
As of |
||||||
(in thousands, except par value and share data) |
|
|
|
|
||||
|
|
|
|
|
||||
ASSETS |
|
|
|
|
||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
146 |
|
|
$ |
231 |
|
Accounts receivable, net |
|
|
21,325 |
|
|
|
19,830 |
|
Inventories, net |
|
|
6,839 |
|
|
|
6,402 |
|
Other current assets |
|
|
4,603 |
|
|
|
4,157 |
|
|
|
|
|
|
||||
Total current assets |
|
|
32,913 |
|
|
|
30,620 |
|
Medical equipment for sale or rental |
|
|
6,980 |
|
|
|
3,049 |
|
Medical equipment in rental service, net of accumulated depreciation |
|
|
36,262 |
|
|
|
34,928 |
|
Property & equipment, net of accumulated depreciation |
|
|
4,174 |
|
|
|
4,321 |
|
|
|
|
3,710 |
|
|
|
3,710 |
|
Intangible assets, net |
|
|
6,951 |
|
|
|
7,446 |
|
Operating lease right of use assets |
|
|
5,845 |
|
|
|
6,703 |
|
Deferred income taxes |
|
|
8,644 |
|
|
|
9,115 |
|
Derivative financial instruments |
|
|
1,714 |
|
|
|
1,442 |
|
Other assets |
|
|
1,334 |
|
|
|
1,581 |
|
|
|
|
|
|
||||
Total assets |
|
$ |
108,527 |
|
|
$ |
102,915 |
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
||||
Current liabilities: |
|
|
|
|
||||
Accounts payable |
|
$ |
9,940 |
|
|
$ |
8,009 |
|
Other current liabilities |
|
|
5,940 |
|
|
|
7,704 |
|
|
|
|
|
|
||||
Total current liabilities |
|
|
15,880 |
|
|
|
15,713 |
|
Long-term debt, net of current portion |
|
|
34,165 |
|
|
|
29,101 |
|
Operating lease liabilities, net of current portion |
|
|
4,995 |
|
|
|
5,799 |
|
|
|
|
|
|
||||
Total liabilities |
|
|
55,040 |
|
|
|
50,613 |
|
|
|
|
|
|
||||
Stockholders’ equity: |
|
|
|
|
||||
Preferred stock, |
|
|
— |
|
|
|
— |
|
Common stock, |
|
|
2 |
|
|
|
2 |
|
Additional paid-in capital |
|
|
111,493 |
|
|
|
109,837 |
|
Accumulated other comprehensive income |
|
|
1,295 |
|
|
|
1,088 |
|
Retained deficit |
|
|
(59,303 |
) |
|
|
(58,625 |
) |
|
|
|
|
|
||||
Total stockholders’ equity |
|
|
53,487 |
|
|
|
52,302 |
|
|
|
|
|
|
||||
Total liabilities and stockholders’ equity |
|
$ |
108,527 |
|
|
$ |
102,915 |
|
|
||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
(UNAUDITED) |
||||||||
|
|
Six Months Ended |
||||||
(in thousands) |
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
||||
OPERATING ACTIVITIES |
|
|
|
|
||||
Net (loss) income |
|
$ |
(395 |
) |
|
$ |
111 |
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities: |
|
|
|
|
||||
Provision for doubtful accounts |
|
|
(194 |
) |
|
|
47 |
|
Depreciation |
|
|
5,438 |
|
|
|
5,801 |
|
Loss on disposal of and reserve adjustments for medical equipment |
|
|
316 |
|
|
|
828 |
|
Gain on sale of medical equipment |
|
|
(1,036 |
) |
|
|
(1,402 |
) |
Amortization of intangible assets |
|
|
495 |
|
|
|
495 |
|
Amortization of deferred debt issuance costs |
|
|
39 |
|
|
|
78 |
|
Stock-based compensation |
|
|
2,055 |
|
|
|
1,736 |
|
Deferred income taxes |
|
|
405 |
|
|
|
(106 |
) |
Changes in assets - (increase)/decrease: |
|
|
|
|
||||
Accounts receivable |
|
|
(1,203 |
) |
|
|
(506 |
) |
Inventories |
|
|
(437 |
) |
|
|
(885 |
) |
Other current assets |
|
|
(446 |
) |
|
|
(994 |
) |
Other assets |
|
|
914 |
|
|
|
(1,719 |
) |
Changes in liabilities - (decrease)/increase: |
|
|
|
|
||||
Accounts payable and other liabilities |
|
|
(3,265 |
) |
|
|
(1,183 |
) |
NET CASH PROVIDED BY OPERATING ACTIVITIES |
|
|
2,686 |
|
|
|
2,301 |
|
|
|
|
|
|
||||
INVESTING ACTIVITIES |
|
|
|
|
||||
Purchase of medical equipment |
|
|
(8,796 |
) |
|
|
(6,994 |
) |
Purchase of property and equipment |
|
|
(519 |
) |
|
|
(494 |
) |
Proceeds from sale of medical equipment, property and equipment |
|
|
2,201 |
|
|
|
2,098 |
|
|
|
|
(7,114 |
) |
|
|
(5,390 |
) |
|
|
|
|
|
||||
FINANCING ACTIVITIES |
|
|
|
|
||||
Principal payments on long-term debt |
|
|
(26,744 |
) |
|
|
(29,451 |
) |
Cash proceeds from long-term debt |
|
|
31,769 |
|
|
|
32,585 |
|
Debt issuance costs |
|
|
— |
|
|
|
(229 |
) |
Common stock repurchased as part of share repurchase program |
|
|
(283 |
) |
|
|
(153 |
) |
Common stock repurchased to satisfy statutory withholding on employee stock-based compensation plans |
|
|
(624 |
) |
|
|
(523 |
) |
Cash proceeds from exercise of options and ESPP |
|
|
225 |
|
|
|
829 |
|
NET CASH PROVIDED BY FINANCING ACTIVITIES |
|
|
4,343 |
|
|
|
3,058 |
|
|
|
|
|
|
||||
Net change in cash and cash equivalents |
|
|
(85 |
) |
|
|
(31 |
) |
Cash and cash equivalents, beginning of period |
|
|
231 |
|
|
|
165 |
|
Cash and cash equivalents, end of period |
|
$ |
146 |
|
|
$ |
134 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240808818926/en/
602-889-9700
Source: