Zynex Announces 2017 First Quarter Results

LONE TREE, Colo., May 15, 2017 /PRNewswire/ -- Zynex, Inc. (OTCQB: ZYXI), an innovative medical technology company specializing in the manufacture and sale of non-invasive medical devices for pain management, stroke rehabilitation, cardiac monitoring and neurological diagnostics, announces 2017 first quarter financial results.

President and CEO Commentary:

Thomas Sandgaard, CEO commented: "The first quarter of 2017 was a continuation of a strong second half of 2016 with net income of $478,000 and revenue of $3.4 million for the quarter. Our gross profit margins are still strong at 76% and a focus on lowering fixed expenses is paying off in terms of positive cash flow and a strong, positive net income.

"We received financing of $1 million towards the end of the first quarter which has been extremely helpful in terms of building enough products to keep up with sales orders and now providing our sales force with demonstration units. We are also experiencing a significant improvement in cash collections as a result of improved billing efforts and are streamlining our infrastructure to accommodate further growth in orders. Sales order growth had been limited the past couple of quarters due to cash constraints and not having any availability to borrow under our line of credit. We continue to reduce the balance on our line of credit and the balance at the end of April 2017 was $1.9 million, down from $2.7 million at the beginning of the year.

"We currently estimate our second quarter revenue to come in at approximately $3.8 million, a net income of $500,000 and EBITDA around $650,000. EBITDA in the first quarter of 2017 was $580,000 and for the full year 2016 it was $640,000.

"Our long term goals continue to be taking advantage of the huge void in the electrotherapy industry realizing annual revenue in excess of $250 million, a listing of a national stock exchange and also launching our Blood Volume Monitor into the hospital market for non-invasively detecting blood loss and internal bleeding."

Summary of Financial Results:

The Company's net revenue was flat compared to the year before, $3,436,000 for the first quarter of 2017, compared to $3,477,000 for the first quarter in 2016. The lack of growth was primarily impeded by the lack of cash and available borrowings under the line of credit to facilitate the production of units to fill orders timely. Cost of Goods Sold decreased from $983,000 in the first quarter of 2016 compared to $809,000 in the same quarter in 2017 which reflects an increase in Gross Profit Margin to 76% versus 72% in the same period 2016.   

The Company reported Selling, General and Administrative ("SG&A") expenses of $2,047,000 for first quarter 2017, compared to $2,844,000 for the first quarter 2016. The Company's SG&A expenses decreased 28% compared to the same period last year, continuing a trend of decreasing operating expenses, primarily reduced employee expenses, resulting in an improvement of the quarter's operating result by $930,000.

The Company reported net income of $478,000 or one cent per share for the first quarter of 2017 compared to a net loss of $440,000 in the first quarter of 2016 or one cent per share.

The Company's cash and line of credit balance as of March 31, 2017 was $462,000 and $2,171,000, respectively, as compared to cash and line of credit balance as of December 31, 2016 of $247,000 and $2,771,000.

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