Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Electromed, Inc. Announces Fiscal 2023 Third Quarter Results By: Electromed, Inc. via Business Wire May 09, 2023 at 16:05 PM EDT Quarterly Net Revenue Increase of 19% Year-over-Year Electromed, Inc. (“Electromed”) (NYSE American: ELMD), a leader in innovative airway clearance technologies, today announced financial results for the three months ended March 31, 2023 (“Q3 FY 2023”). Q3 FY 2023 Highlights Record quarterly net revenues of $12.1 million, a 19% year-over-year increase Homecare revenue of $11.0 million, an increase of 21% year-over-year Generated operating income of $1.2 million, an increase of 39% year-over-year Net income of $1.1 million, or $0.12 per fully diluted share, compared with net income of $645,000 in the same period a year ago Cash as of March 31, 2023 was $6.8 million “I’m very pleased to report 19% revenue growth in the third quarter of fiscal year 2023 coupled with net income growth that further demonstrates that our investments in growth are yielding strong results,” said Kathleen Skarvan, President and Chief Executive Officer. “Our revenue growth was driven by strong referral growth, improved productivity by our expanded sales team and the recent launch to the homecare market of our next generation SmartVest Clearway.” Ms. Skarvan continued, “Our SmartVest Clearway has been received very positively by clinicians and patients due to its state-of-the-art patient experience with a simple touch screen user interface, remote monitoring of data, and is the lightest HFCWO generator on the market. We believe that Electromed is well-positioned for growth and profitability in calendar 2023.” Fiscal Third Quarter Results Net revenues for Q3 FY 2023 increased by 19% year-over-year to $12.1 million, compared with $10.1 million in the same period the prior year. The increase over the prior year was driven by an increase in referrals and approvals due to an expanded sales force and reimbursement team. Home care revenue increased by $1,938,000, or 21.5%, for the three months ended March 31, 2023 compared to the same period in the prior year. The increase was primarily due to an increase in referrals and approvals. The increase in referrals was due to an increase in direct sales representatives as well as positive market momentum from the introduction of our newest generation SmartVest Clearway in the quarter and was partially offset by a temporary interruption in supply chain and associated operations in the quarter. Field sales force employees totaled 57 at quarter end, 48 of which were direct sales representatives. Sales productivity remained within our expected range during the quarter, with annualized home care revenues per direct sales representative at $908,000, within Electromed’s target range of $850,000 to $950,000. Gross profit increased to $9,056,000, or 75.0% of net revenues, for the three months ended March 31, 2023, from $7,743,000, or 76.4% of net revenues, in the same period in the prior year. The decrease in gross profit as a percentage of net revenues compared to the same period in the prior year was primarily due to increased material costs and component broker fees incurred to ramp up supply for the Clearway product. Selling, general and administrative (“SG&A”) expenses were $7,694,000 for the three months ended March 31, 2023, representing an increase of $1,150,000, or 17.6%, compared to the same period in the prior year. The increase in SG&A expense was primarily due to increased payroll and compensation expense related to the higher average number of sales, sales support, marketing, and reimbursement personnel to process higher patient referrals. Operating income for the three months ended March 31, 2023 was $1,196,000, compared to $863,000 for the same period in the prior year. The increase in operating income was driven primarily by revenue growth and a decrease in Research & Development expenses but partially offset by increased SG&A expenses related to our sales and reimbursement investments, as well as increased material costs and broker fees incurred to accelerate the ramp up supply for the Clearway product. Net income for the three months ended March 31, 2023 was $1,075,000, or $0.12 per diluted share, compared to $645,000, or $0.07 per diluted share, for the same period in the prior year. As of March 31, 2023, Electromed had $6.8 million in cash, $22.3 million in accounts receivable, working capital of $28.8 million, and total shareholders’ equity of $36.4 million. Conference Call and Webcast Information The conference call will be held at 5:00 p.m. Eastern Time on Tuesday, May 9, 2023. Interested parties may participate in the call by dialing (888) 999-5318 (Domestic) or (848) 280-6460 (International). The live conference call webcast will be accessible in the Investor Relations section of Electromed’s web site and directly via the following link: Fiscal Third Quarter Earnings Webcast. For those who cannot listen to the live broadcast, a replay will be available by dialing (844) 512-2921 (Domestic) or (412) 317-6671 (International) and referencing the replay pin number 0151926. Additionally, an online replay will be available in the Investor Relations section of Electromed’s web site at: http://investors.smartvest.com/. About Electromed, Inc. Electromed, Inc. manufactures, markets, and sells products that provide airway clearance therapy, including the SmartVest® Airway Clearance System, to patients with compromised pulmonary function. It is headquartered in New Prague, Minnesota, and was founded in 1992. Further information about Electromed can be found at www.smartvest.com. Cautionary Statements Certain statements in this press release constitute forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can generally be identified by words such as “anticipate,” “assume,” “believe,” “continue,” “expect,” “may,” “potential,” “should,” “will,” and similar expressions, including the negative of these terms, but they are not the exclusive means of identifying such statements. Forward-looking statements cannot be guaranteed, and actual results may vary materially due to the uncertainties and risks, known or unknown associated with such statements. Examples of risks and uncertainties for Electromed include, but are not limited to, component or raw material shortages, changes to lead times or significant price increases, changes to Medicare, Medicaid, or private insurance reimbursement policies; the duration, extent and severity of the COVID-19 pandemic, including its effects on our business, supply chain, operations and employees as well as its impact on our customers and distribution channels and on economies and markets more generally; the competitive nature of our market; changes to state and federal health care laws; changes affecting the medical device industry; our ability to develop new sales channels for our products such as the homecare distributor channel; our need to maintain regulatory compliance and to gain future regulatory approvals and clearances; new drug or pharmaceutical discoveries; general economic and business conditions; our ability to renew our line of credit or obtain additional credit as necessary; our ability to protect and expand our intellectual property portfolio; the risks associated with expansion into international markets, as well as other factors we may describe from time to time in Electromed’s reports filed with the Securities and Exchange Commission (including Electromed’s most recent Annual Report on Form 10-K, as amended from time to time, and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K). Investors should not consider any list of such factors to be an exhaustive statement of all of the risks, uncertainties or potentially inaccurate assumptions investors should take into account when making investment decisions. Shareholders and other readers should not place undue reliance on “forward-looking statements,” as such statements speak only as of the date of this press release. We undertake no obligation to update them in light of new information or future events. Source: Electromed, Inc. Financial Tables Follow: Electromed, Inc. Condensed Balance Sheets March 31, 2023 June 30, 2022 (Unaudited) Assets Current Assets Cash and cash equivalents $ 6,776,000 $ 8,153,000 Accounts receivable (net of allowances for doubtful accounts of $45,000) 22,345,000 21,052,000 Contract assets 570,000 286,000 Inventories 3,451,000 3,178,000 Prepaid expenses and other current assets 1,808,000 1,870,000 Income tax receivable 219,000 - Total current assets 35,169,000 34,539,000 Property and equipment, net 5,502,000 4,568,000 Finite-life intangible assets, net 604,000 599,000 Other assets 60,000 120,000 Deferred income taxes 1,506,000 1,538,000 Total assets $ 42,841,000 $ 41,364,000 Liabilities and Shareholders' Equity Current Liabilities Accounts payable 1,289,000 1,261,000 Accrued compensation 2,082,000 2,742,000 Income tax payable - 51,000 Warranty reserve 1,333,000 1,256,000 Other accrued liabilities 1,713,000 1,840,000 Total current liabilities 6,417,000 7,150,000 Other long-term liabilities 30,000 41,000 Total liabilities 6,447,000 7,191,000 Commitments and Contingencies Shareholders' Equity Common stock, $0.01 par value per share, 13,000,000 shares authorized; 8,556,600 and 8,475,438 shares issued and outstanding, as of March 31, 2023 and June 30, 2022, respectively 86,000 85,000 Additional paid-in capital 18,548,000 18,308,000 Retained earnings 17,760,000 15,780,000 Total shareholders' equity 36,394,000 34,173,000 Total liabilities and shareholders' equity $ 42,841,000 $ 41,364,000 Electromed, Inc. Condensed Statements of Operations (Unaudited) Three Months Ended Nine Months Ended March 31, March 31, 2023 2022 2023 2022 Net revenues $ 12,068,000 $ 10,141,000 $ 34,455,000 $ 30,390,000 Cost of revenues 3,012,000 2,398,000 8,386,000 7,066,000 Gross profit 9,056,000 7,743,000 26,069,000 23,324,000 Operating expenses Selling, general and administrative 7,694,000 6,544,000 22,937,000 19,806,000 Research and development 166,000 336,000 618,000 1,041,000 Total operating expenses 7,860,000 6,880,000 23,555,000 20,847,000 Operating income 1,196,000 863,000 2,514,000 2,477,000 Interest income, net 26,000 6,000 37,000 21,000 Net income before income taxes 1,222,000 869,000 2,551,000 2,498,000 Income tax expense 147,000 224,000 418,000 576,000 Net income $ 1,075,000 $ 645,000 $ 2,133,000 $ 1,922,000 Income per share: Basic $ 0.13 $ 0.08 $ 0.25 $ 0.23 Diluted $ 0.12 $ 0.07 $ 0.25 $ 0.22 Weighted-average common shares outstanding: Basic 8,461,531 8,454,504 8,449,623 8,485,856 Diluted 8,710,106 8,744,535 8,694,407 8,762,963 Electromed, Inc. Condensed Statements of Cash Flows (Unaudited) Nine Months Ended March 31, 2023 2022 Cash Flows From Operating Activities Net income $ 2,133,000 $ 1,922,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 370,000 368,000 Amortization of finite-life intangible assets 52,000 105,000 Share-based compensation expense 506,000 703,000 Deferred income taxes 32,000 15,000 Changes in operating assets and liabilities: Accounts receivable (1,293,000 ) (2,582,000 ) Contract assets (284,000 ) 98,000 Inventories (264,000 ) 9,000 Prepaid expenses and other assets 105,000 (519,000 ) Income tax receivable, net (270,000 ) (443,000 ) Accounts payable and accrued liabilities (111,000 ) 550,000 Accrued compensation (660,000 ) (173,000 ) Net cash provided by operating activities 316,000 53,000 Cash Flows From Investing Activities Investment in property and equipment (1,221,000 ) (980,000 ) Investment in finite-life intangible assets (54,000 ) (86,000 ) Net cash used in investing activities (1,275,000 ) (1,066,000 ) Cash Flows From Financing Activities Issuance of common stock upon exercise of options 40,000 - Taxes paid on stock options exercised on a net basis (305,000 ) (70,000 ) Repurchase of common stock (153,000 ) (962,000 ) Net cash used in financing activities (418,000 ) (1,032,000 ) Net (decrease) increase in cash (1,377,000 ) (2,045,000 ) Cash And Cash Equivalents Beginning of period 8,153,000 11,889,000 End of period $ 6,776,000 $ 9,844,000 View source version on businesswire.com: https://www.businesswire.com/news/home/20230509005307/en/Contacts Brad Nagel, Chief Financial Officer (952) 758-9299 investorrelations@electromed.com Mike Cavanaugh, Investor Relations ICR Westwicke (617) 877-9641 mike.cavanaugh@westwicke.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. 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Electromed, Inc. Announces Fiscal 2023 Third Quarter Results By: Electromed, Inc. via Business Wire May 09, 2023 at 16:05 PM EDT Quarterly Net Revenue Increase of 19% Year-over-Year Electromed, Inc. (“Electromed”) (NYSE American: ELMD), a leader in innovative airway clearance technologies, today announced financial results for the three months ended March 31, 2023 (“Q3 FY 2023”). Q3 FY 2023 Highlights Record quarterly net revenues of $12.1 million, a 19% year-over-year increase Homecare revenue of $11.0 million, an increase of 21% year-over-year Generated operating income of $1.2 million, an increase of 39% year-over-year Net income of $1.1 million, or $0.12 per fully diluted share, compared with net income of $645,000 in the same period a year ago Cash as of March 31, 2023 was $6.8 million “I’m very pleased to report 19% revenue growth in the third quarter of fiscal year 2023 coupled with net income growth that further demonstrates that our investments in growth are yielding strong results,” said Kathleen Skarvan, President and Chief Executive Officer. “Our revenue growth was driven by strong referral growth, improved productivity by our expanded sales team and the recent launch to the homecare market of our next generation SmartVest Clearway.” Ms. Skarvan continued, “Our SmartVest Clearway has been received very positively by clinicians and patients due to its state-of-the-art patient experience with a simple touch screen user interface, remote monitoring of data, and is the lightest HFCWO generator on the market. We believe that Electromed is well-positioned for growth and profitability in calendar 2023.” Fiscal Third Quarter Results Net revenues for Q3 FY 2023 increased by 19% year-over-year to $12.1 million, compared with $10.1 million in the same period the prior year. The increase over the prior year was driven by an increase in referrals and approvals due to an expanded sales force and reimbursement team. Home care revenue increased by $1,938,000, or 21.5%, for the three months ended March 31, 2023 compared to the same period in the prior year. The increase was primarily due to an increase in referrals and approvals. The increase in referrals was due to an increase in direct sales representatives as well as positive market momentum from the introduction of our newest generation SmartVest Clearway in the quarter and was partially offset by a temporary interruption in supply chain and associated operations in the quarter. Field sales force employees totaled 57 at quarter end, 48 of which were direct sales representatives. Sales productivity remained within our expected range during the quarter, with annualized home care revenues per direct sales representative at $908,000, within Electromed’s target range of $850,000 to $950,000. Gross profit increased to $9,056,000, or 75.0% of net revenues, for the three months ended March 31, 2023, from $7,743,000, or 76.4% of net revenues, in the same period in the prior year. The decrease in gross profit as a percentage of net revenues compared to the same period in the prior year was primarily due to increased material costs and component broker fees incurred to ramp up supply for the Clearway product. Selling, general and administrative (“SG&A”) expenses were $7,694,000 for the three months ended March 31, 2023, representing an increase of $1,150,000, or 17.6%, compared to the same period in the prior year. The increase in SG&A expense was primarily due to increased payroll and compensation expense related to the higher average number of sales, sales support, marketing, and reimbursement personnel to process higher patient referrals. Operating income for the three months ended March 31, 2023 was $1,196,000, compared to $863,000 for the same period in the prior year. The increase in operating income was driven primarily by revenue growth and a decrease in Research & Development expenses but partially offset by increased SG&A expenses related to our sales and reimbursement investments, as well as increased material costs and broker fees incurred to accelerate the ramp up supply for the Clearway product. Net income for the three months ended March 31, 2023 was $1,075,000, or $0.12 per diluted share, compared to $645,000, or $0.07 per diluted share, for the same period in the prior year. As of March 31, 2023, Electromed had $6.8 million in cash, $22.3 million in accounts receivable, working capital of $28.8 million, and total shareholders’ equity of $36.4 million. Conference Call and Webcast Information The conference call will be held at 5:00 p.m. Eastern Time on Tuesday, May 9, 2023. Interested parties may participate in the call by dialing (888) 999-5318 (Domestic) or (848) 280-6460 (International). The live conference call webcast will be accessible in the Investor Relations section of Electromed’s web site and directly via the following link: Fiscal Third Quarter Earnings Webcast. For those who cannot listen to the live broadcast, a replay will be available by dialing (844) 512-2921 (Domestic) or (412) 317-6671 (International) and referencing the replay pin number 0151926. Additionally, an online replay will be available in the Investor Relations section of Electromed’s web site at: http://investors.smartvest.com/. About Electromed, Inc. Electromed, Inc. manufactures, markets, and sells products that provide airway clearance therapy, including the SmartVest® Airway Clearance System, to patients with compromised pulmonary function. It is headquartered in New Prague, Minnesota, and was founded in 1992. Further information about Electromed can be found at www.smartvest.com. Cautionary Statements Certain statements in this press release constitute forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can generally be identified by words such as “anticipate,” “assume,” “believe,” “continue,” “expect,” “may,” “potential,” “should,” “will,” and similar expressions, including the negative of these terms, but they are not the exclusive means of identifying such statements. Forward-looking statements cannot be guaranteed, and actual results may vary materially due to the uncertainties and risks, known or unknown associated with such statements. Examples of risks and uncertainties for Electromed include, but are not limited to, component or raw material shortages, changes to lead times or significant price increases, changes to Medicare, Medicaid, or private insurance reimbursement policies; the duration, extent and severity of the COVID-19 pandemic, including its effects on our business, supply chain, operations and employees as well as its impact on our customers and distribution channels and on economies and markets more generally; the competitive nature of our market; changes to state and federal health care laws; changes affecting the medical device industry; our ability to develop new sales channels for our products such as the homecare distributor channel; our need to maintain regulatory compliance and to gain future regulatory approvals and clearances; new drug or pharmaceutical discoveries; general economic and business conditions; our ability to renew our line of credit or obtain additional credit as necessary; our ability to protect and expand our intellectual property portfolio; the risks associated with expansion into international markets, as well as other factors we may describe from time to time in Electromed’s reports filed with the Securities and Exchange Commission (including Electromed’s most recent Annual Report on Form 10-K, as amended from time to time, and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K). Investors should not consider any list of such factors to be an exhaustive statement of all of the risks, uncertainties or potentially inaccurate assumptions investors should take into account when making investment decisions. Shareholders and other readers should not place undue reliance on “forward-looking statements,” as such statements speak only as of the date of this press release. We undertake no obligation to update them in light of new information or future events. Source: Electromed, Inc. Financial Tables Follow: Electromed, Inc. Condensed Balance Sheets March 31, 2023 June 30, 2022 (Unaudited) Assets Current Assets Cash and cash equivalents $ 6,776,000 $ 8,153,000 Accounts receivable (net of allowances for doubtful accounts of $45,000) 22,345,000 21,052,000 Contract assets 570,000 286,000 Inventories 3,451,000 3,178,000 Prepaid expenses and other current assets 1,808,000 1,870,000 Income tax receivable 219,000 - Total current assets 35,169,000 34,539,000 Property and equipment, net 5,502,000 4,568,000 Finite-life intangible assets, net 604,000 599,000 Other assets 60,000 120,000 Deferred income taxes 1,506,000 1,538,000 Total assets $ 42,841,000 $ 41,364,000 Liabilities and Shareholders' Equity Current Liabilities Accounts payable 1,289,000 1,261,000 Accrued compensation 2,082,000 2,742,000 Income tax payable - 51,000 Warranty reserve 1,333,000 1,256,000 Other accrued liabilities 1,713,000 1,840,000 Total current liabilities 6,417,000 7,150,000 Other long-term liabilities 30,000 41,000 Total liabilities 6,447,000 7,191,000 Commitments and Contingencies Shareholders' Equity Common stock, $0.01 par value per share, 13,000,000 shares authorized; 8,556,600 and 8,475,438 shares issued and outstanding, as of March 31, 2023 and June 30, 2022, respectively 86,000 85,000 Additional paid-in capital 18,548,000 18,308,000 Retained earnings 17,760,000 15,780,000 Total shareholders' equity 36,394,000 34,173,000 Total liabilities and shareholders' equity $ 42,841,000 $ 41,364,000 Electromed, Inc. Condensed Statements of Operations (Unaudited) Three Months Ended Nine Months Ended March 31, March 31, 2023 2022 2023 2022 Net revenues $ 12,068,000 $ 10,141,000 $ 34,455,000 $ 30,390,000 Cost of revenues 3,012,000 2,398,000 8,386,000 7,066,000 Gross profit 9,056,000 7,743,000 26,069,000 23,324,000 Operating expenses Selling, general and administrative 7,694,000 6,544,000 22,937,000 19,806,000 Research and development 166,000 336,000 618,000 1,041,000 Total operating expenses 7,860,000 6,880,000 23,555,000 20,847,000 Operating income 1,196,000 863,000 2,514,000 2,477,000 Interest income, net 26,000 6,000 37,000 21,000 Net income before income taxes 1,222,000 869,000 2,551,000 2,498,000 Income tax expense 147,000 224,000 418,000 576,000 Net income $ 1,075,000 $ 645,000 $ 2,133,000 $ 1,922,000 Income per share: Basic $ 0.13 $ 0.08 $ 0.25 $ 0.23 Diluted $ 0.12 $ 0.07 $ 0.25 $ 0.22 Weighted-average common shares outstanding: Basic 8,461,531 8,454,504 8,449,623 8,485,856 Diluted 8,710,106 8,744,535 8,694,407 8,762,963 Electromed, Inc. Condensed Statements of Cash Flows (Unaudited) Nine Months Ended March 31, 2023 2022 Cash Flows From Operating Activities Net income $ 2,133,000 $ 1,922,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 370,000 368,000 Amortization of finite-life intangible assets 52,000 105,000 Share-based compensation expense 506,000 703,000 Deferred income taxes 32,000 15,000 Changes in operating assets and liabilities: Accounts receivable (1,293,000 ) (2,582,000 ) Contract assets (284,000 ) 98,000 Inventories (264,000 ) 9,000 Prepaid expenses and other assets 105,000 (519,000 ) Income tax receivable, net (270,000 ) (443,000 ) Accounts payable and accrued liabilities (111,000 ) 550,000 Accrued compensation (660,000 ) (173,000 ) Net cash provided by operating activities 316,000 53,000 Cash Flows From Investing Activities Investment in property and equipment (1,221,000 ) (980,000 ) Investment in finite-life intangible assets (54,000 ) (86,000 ) Net cash used in investing activities (1,275,000 ) (1,066,000 ) Cash Flows From Financing Activities Issuance of common stock upon exercise of options 40,000 - Taxes paid on stock options exercised on a net basis (305,000 ) (70,000 ) Repurchase of common stock (153,000 ) (962,000 ) Net cash used in financing activities (418,000 ) (1,032,000 ) Net (decrease) increase in cash (1,377,000 ) (2,045,000 ) Cash And Cash Equivalents Beginning of period 8,153,000 11,889,000 End of period $ 6,776,000 $ 9,844,000 View source version on businesswire.com: https://www.businesswire.com/news/home/20230509005307/en/Contacts Brad Nagel, Chief Financial Officer (952) 758-9299 investorrelations@electromed.com Mike Cavanaugh, Investor Relations ICR Westwicke (617) 877-9641 mike.cavanaugh@westwicke.com
Electromed, Inc. (“Electromed”) (NYSE American: ELMD), a leader in innovative airway clearance technologies, today announced financial results for the three months ended March 31, 2023 (“Q3 FY 2023”). Q3 FY 2023 Highlights Record quarterly net revenues of $12.1 million, a 19% year-over-year increase Homecare revenue of $11.0 million, an increase of 21% year-over-year Generated operating income of $1.2 million, an increase of 39% year-over-year Net income of $1.1 million, or $0.12 per fully diluted share, compared with net income of $645,000 in the same period a year ago Cash as of March 31, 2023 was $6.8 million “I’m very pleased to report 19% revenue growth in the third quarter of fiscal year 2023 coupled with net income growth that further demonstrates that our investments in growth are yielding strong results,” said Kathleen Skarvan, President and Chief Executive Officer. “Our revenue growth was driven by strong referral growth, improved productivity by our expanded sales team and the recent launch to the homecare market of our next generation SmartVest Clearway.” Ms. Skarvan continued, “Our SmartVest Clearway has been received very positively by clinicians and patients due to its state-of-the-art patient experience with a simple touch screen user interface, remote monitoring of data, and is the lightest HFCWO generator on the market. We believe that Electromed is well-positioned for growth and profitability in calendar 2023.” Fiscal Third Quarter Results Net revenues for Q3 FY 2023 increased by 19% year-over-year to $12.1 million, compared with $10.1 million in the same period the prior year. The increase over the prior year was driven by an increase in referrals and approvals due to an expanded sales force and reimbursement team. Home care revenue increased by $1,938,000, or 21.5%, for the three months ended March 31, 2023 compared to the same period in the prior year. The increase was primarily due to an increase in referrals and approvals. The increase in referrals was due to an increase in direct sales representatives as well as positive market momentum from the introduction of our newest generation SmartVest Clearway in the quarter and was partially offset by a temporary interruption in supply chain and associated operations in the quarter. Field sales force employees totaled 57 at quarter end, 48 of which were direct sales representatives. Sales productivity remained within our expected range during the quarter, with annualized home care revenues per direct sales representative at $908,000, within Electromed’s target range of $850,000 to $950,000. Gross profit increased to $9,056,000, or 75.0% of net revenues, for the three months ended March 31, 2023, from $7,743,000, or 76.4% of net revenues, in the same period in the prior year. The decrease in gross profit as a percentage of net revenues compared to the same period in the prior year was primarily due to increased material costs and component broker fees incurred to ramp up supply for the Clearway product. Selling, general and administrative (“SG&A”) expenses were $7,694,000 for the three months ended March 31, 2023, representing an increase of $1,150,000, or 17.6%, compared to the same period in the prior year. The increase in SG&A expense was primarily due to increased payroll and compensation expense related to the higher average number of sales, sales support, marketing, and reimbursement personnel to process higher patient referrals. Operating income for the three months ended March 31, 2023 was $1,196,000, compared to $863,000 for the same period in the prior year. The increase in operating income was driven primarily by revenue growth and a decrease in Research & Development expenses but partially offset by increased SG&A expenses related to our sales and reimbursement investments, as well as increased material costs and broker fees incurred to accelerate the ramp up supply for the Clearway product. Net income for the three months ended March 31, 2023 was $1,075,000, or $0.12 per diluted share, compared to $645,000, or $0.07 per diluted share, for the same period in the prior year. As of March 31, 2023, Electromed had $6.8 million in cash, $22.3 million in accounts receivable, working capital of $28.8 million, and total shareholders’ equity of $36.4 million. Conference Call and Webcast Information The conference call will be held at 5:00 p.m. Eastern Time on Tuesday, May 9, 2023. Interested parties may participate in the call by dialing (888) 999-5318 (Domestic) or (848) 280-6460 (International). The live conference call webcast will be accessible in the Investor Relations section of Electromed’s web site and directly via the following link: Fiscal Third Quarter Earnings Webcast. For those who cannot listen to the live broadcast, a replay will be available by dialing (844) 512-2921 (Domestic) or (412) 317-6671 (International) and referencing the replay pin number 0151926. Additionally, an online replay will be available in the Investor Relations section of Electromed’s web site at: http://investors.smartvest.com/. About Electromed, Inc. Electromed, Inc. manufactures, markets, and sells products that provide airway clearance therapy, including the SmartVest® Airway Clearance System, to patients with compromised pulmonary function. It is headquartered in New Prague, Minnesota, and was founded in 1992. Further information about Electromed can be found at www.smartvest.com. Cautionary Statements Certain statements in this press release constitute forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can generally be identified by words such as “anticipate,” “assume,” “believe,” “continue,” “expect,” “may,” “potential,” “should,” “will,” and similar expressions, including the negative of these terms, but they are not the exclusive means of identifying such statements. Forward-looking statements cannot be guaranteed, and actual results may vary materially due to the uncertainties and risks, known or unknown associated with such statements. Examples of risks and uncertainties for Electromed include, but are not limited to, component or raw material shortages, changes to lead times or significant price increases, changes to Medicare, Medicaid, or private insurance reimbursement policies; the duration, extent and severity of the COVID-19 pandemic, including its effects on our business, supply chain, operations and employees as well as its impact on our customers and distribution channels and on economies and markets more generally; the competitive nature of our market; changes to state and federal health care laws; changes affecting the medical device industry; our ability to develop new sales channels for our products such as the homecare distributor channel; our need to maintain regulatory compliance and to gain future regulatory approvals and clearances; new drug or pharmaceutical discoveries; general economic and business conditions; our ability to renew our line of credit or obtain additional credit as necessary; our ability to protect and expand our intellectual property portfolio; the risks associated with expansion into international markets, as well as other factors we may describe from time to time in Electromed’s reports filed with the Securities and Exchange Commission (including Electromed’s most recent Annual Report on Form 10-K, as amended from time to time, and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K). Investors should not consider any list of such factors to be an exhaustive statement of all of the risks, uncertainties or potentially inaccurate assumptions investors should take into account when making investment decisions. Shareholders and other readers should not place undue reliance on “forward-looking statements,” as such statements speak only as of the date of this press release. We undertake no obligation to update them in light of new information or future events. Source: Electromed, Inc. Financial Tables Follow: Electromed, Inc. Condensed Balance Sheets March 31, 2023 June 30, 2022 (Unaudited) Assets Current Assets Cash and cash equivalents $ 6,776,000 $ 8,153,000 Accounts receivable (net of allowances for doubtful accounts of $45,000) 22,345,000 21,052,000 Contract assets 570,000 286,000 Inventories 3,451,000 3,178,000 Prepaid expenses and other current assets 1,808,000 1,870,000 Income tax receivable 219,000 - Total current assets 35,169,000 34,539,000 Property and equipment, net 5,502,000 4,568,000 Finite-life intangible assets, net 604,000 599,000 Other assets 60,000 120,000 Deferred income taxes 1,506,000 1,538,000 Total assets $ 42,841,000 $ 41,364,000 Liabilities and Shareholders' Equity Current Liabilities Accounts payable 1,289,000 1,261,000 Accrued compensation 2,082,000 2,742,000 Income tax payable - 51,000 Warranty reserve 1,333,000 1,256,000 Other accrued liabilities 1,713,000 1,840,000 Total current liabilities 6,417,000 7,150,000 Other long-term liabilities 30,000 41,000 Total liabilities 6,447,000 7,191,000 Commitments and Contingencies Shareholders' Equity Common stock, $0.01 par value per share, 13,000,000 shares authorized; 8,556,600 and 8,475,438 shares issued and outstanding, as of March 31, 2023 and June 30, 2022, respectively 86,000 85,000 Additional paid-in capital 18,548,000 18,308,000 Retained earnings 17,760,000 15,780,000 Total shareholders' equity 36,394,000 34,173,000 Total liabilities and shareholders' equity $ 42,841,000 $ 41,364,000 Electromed, Inc. Condensed Statements of Operations (Unaudited) Three Months Ended Nine Months Ended March 31, March 31, 2023 2022 2023 2022 Net revenues $ 12,068,000 $ 10,141,000 $ 34,455,000 $ 30,390,000 Cost of revenues 3,012,000 2,398,000 8,386,000 7,066,000 Gross profit 9,056,000 7,743,000 26,069,000 23,324,000 Operating expenses Selling, general and administrative 7,694,000 6,544,000 22,937,000 19,806,000 Research and development 166,000 336,000 618,000 1,041,000 Total operating expenses 7,860,000 6,880,000 23,555,000 20,847,000 Operating income 1,196,000 863,000 2,514,000 2,477,000 Interest income, net 26,000 6,000 37,000 21,000 Net income before income taxes 1,222,000 869,000 2,551,000 2,498,000 Income tax expense 147,000 224,000 418,000 576,000 Net income $ 1,075,000 $ 645,000 $ 2,133,000 $ 1,922,000 Income per share: Basic $ 0.13 $ 0.08 $ 0.25 $ 0.23 Diluted $ 0.12 $ 0.07 $ 0.25 $ 0.22 Weighted-average common shares outstanding: Basic 8,461,531 8,454,504 8,449,623 8,485,856 Diluted 8,710,106 8,744,535 8,694,407 8,762,963 Electromed, Inc. Condensed Statements of Cash Flows (Unaudited) Nine Months Ended March 31, 2023 2022 Cash Flows From Operating Activities Net income $ 2,133,000 $ 1,922,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 370,000 368,000 Amortization of finite-life intangible assets 52,000 105,000 Share-based compensation expense 506,000 703,000 Deferred income taxes 32,000 15,000 Changes in operating assets and liabilities: Accounts receivable (1,293,000 ) (2,582,000 ) Contract assets (284,000 ) 98,000 Inventories (264,000 ) 9,000 Prepaid expenses and other assets 105,000 (519,000 ) Income tax receivable, net (270,000 ) (443,000 ) Accounts payable and accrued liabilities (111,000 ) 550,000 Accrued compensation (660,000 ) (173,000 ) Net cash provided by operating activities 316,000 53,000 Cash Flows From Investing Activities Investment in property and equipment (1,221,000 ) (980,000 ) Investment in finite-life intangible assets (54,000 ) (86,000 ) Net cash used in investing activities (1,275,000 ) (1,066,000 ) Cash Flows From Financing Activities Issuance of common stock upon exercise of options 40,000 - Taxes paid on stock options exercised on a net basis (305,000 ) (70,000 ) Repurchase of common stock (153,000 ) (962,000 ) Net cash used in financing activities (418,000 ) (1,032,000 ) Net (decrease) increase in cash (1,377,000 ) (2,045,000 ) Cash And Cash Equivalents Beginning of period 8,153,000 11,889,000 End of period $ 6,776,000 $ 9,844,000 View source version on businesswire.com: https://www.businesswire.com/news/home/20230509005307/en/
Brad Nagel, Chief Financial Officer (952) 758-9299 investorrelations@electromed.com Mike Cavanaugh, Investor Relations ICR Westwicke (617) 877-9641 mike.cavanaugh@westwicke.com
