News | News By Subject | News by Disease News By Date | Search News
Get Our FREE
Industry eNewsletter
email:    
   

Zynex (ZYXI.OB) Announces Second Quarter 2012 Financial Results


8/8/2012 9:51:25 AM

LONE TREE, CO--(Marketwire - August 07, 2012) -

Zynex, Inc. (OTCBB: ZYXI), a provider and developer of non-invasive medical devices for electrotherapy and stroke rehabilitation, neurological diagnosis and cardiac monitoring, announces its second quarter 2012 unaudited financial results.

The Company's total net revenue increased 19% to $10,026,000 for the three months ended June 30, 2012 from $8,395,000 for the three months ended June 30, 2011. Year to date net revenue of $18,970,000 increased 26% over the prior year to date net revenue. The Company's revenue increase for the second quarter and year to date 2012 was primarily driven by its Zynex Medical subsidiary, in which strong demand continues from its products, and a small amount of revenue was derived from its Zynex NeuroDiagnostics subsidiary. The Company generated net income of $473,000, or $0.02 per share in the second quarter of 2012 and net income of $793,000, or $0.03 per share for the first six months of 2012, versus a net income of $484,000, or $0.02 per share in the second quarter of 2011 and net income of $374,000, or $0.01 per share for the first six months of 2011.

The Company reported a gross profit of $8,240,000, or 82% of net revenue, for the second quarter of 2012, and $15,371,000, or 81% of net revenue, for the first six months of 2012, as compared to a gross profit of $6,668,000, or 79% of net revenue, for the second quarter of 2011 and $11,857,000, or 79% of net revenue, for the first six months of 2011.

The Company reported Selling, General and Administrative (SG&A) expenses of $7,308,000, or 73% of net revenue, for the three months ended June 30, 2012, and $13,953,000, or 74% of net revenue, for the six months ended June 30, 2012, as compared to $5,769,000, or 69% of net revenue, for the three months ended June 30, 2011 and $11,097,000, or 74% of net revenue for the six months ended June 30, 2011. Increases in the Company's SG&A expenses during the first three and six months of 2012 were primarily attributable to sales and marketing, specifically for sales commissions (based on the 19% and 26% increase in net revenue) and investments made to expand the Company's Zynex Medical field sales force.

The Company generated a second quarter 2012 income from operations of $932,000, income before income taxes of $844,000 and net income of $473,000, or $0.02 per share, versus a second quarter of 2011 income from operations of $899,000, income before income taxes of $822,000 and net income of $484,000, or $0.02 per share. The Company generated a 2012 year to date income from operations of $1,418,000, income before income taxes of $1,237,000 and net income of $793,000, or $0.03 per share, versus a 2011 year to date income from operations of $760,000, income before income taxes of $625,000 and net income of $374,000, or $0.01 per share.

Thomas Sandgaard, CEO stated: "We were pleased with our second quarter 2012 financial results, which were in line with our strong second quarter of the previous year. Our net revenue increased 19% and 26% during the three and six month periods of 2012, as compared to prior year, and increased 13% quarter over quarter, which is indicative of the demand for our Zynex Medical electrotherapy products and volume of orders our sales team continues to generate. Our Zynex Medical subsidiary still represents the majority of our revenue, but we are encouraged to see a contribution from our Zynex NeuroDiagnostics subsidiary, which includes the first quarter 2012 asset acquisition of NeuroDyne Medical. We continued to invest in our Zynex Medical and Zynex NeuroDiagnostics sales teams, through the addition of field sales representatives, which allowed us to expand our reach and penetration in key geographic markets. Our Zynex Monitoring Solutions subsidiary continues to make progress. We are currently participating in clinical trials expected to run through the remainder of 2012."

Outlook:
The Company confirms its initial guidance of anticipated total net revenue of between $38 million and $40 million for 2012 and net income per diluted share of between $0.06 and $0.08 for 2012.

Conference Call and Webcast Information:
Zynex, Inc. will host an earnings conference call and webcast at 9:00 a.m. MST (11:00 a.m. EST) today to discuss its second quarter 2012 financial results. Please note questions can only be submitted via the webcast user interface. Parties without access to the internet may join the presentation in listen only mode by dialing the toll free number provided below.

Webcast Information- http://www.visualwebcaster.com/event.asp?id=88637

Conference Call Information- 888-221-9541, pass-code 9400881

Highlights from the second quarter ended June 30, 2012 consolidated financial statements:
(unaudited, amounts in thousands, except per share amounts)

                                Three months ended       Six months ended   
                             ----------------------- -----------------------
                               June 30,    June 30,    June 30,    June 30, 
                                 2012        2011        2012        2011   
                             ----------- ----------- ----------- -----------
                                                                            
Net revenue                  $    10,026 $     8,395 $    18,970 $    15,028
                                                                            
Gross profit                       8,240       6,668      15,371      11,857
                                                                            
Income from operations               932         899       1,418         760
                                                                            
Income before income tax             844         822       1,237         625
                                                                            
Net income                           473         484         793         374
                                                                            
Adjusted EBITDA (1)                1,151       1,148       1,833       1,253
                                                                            
Net income per share -                                                      
 diluted                     $      0.02 $      0.02 $      0.03 $      0.01
                                                                            
Weighted-average number of                                                  
 common shares outstanding                                                  
 -diluted                     31,249,107  31,025,478  31,142,876  30,957,206
                                                                            

(1) Reconciliation of unaudited U.S. Generally Accepted Accounting Principles (GAAP) Net income (loss) to Adjusted Earnings Before Interest Taxes Depreciation, and Amortization (Adjusted-EBITDA)

                                  Three months ended     Six months ended   
                                 --------------------  -------------------- 
                                  June 30,   June 30,   June 30,   June 30, 
                                    2012       2011       2012       2011   
                                 ---------  ---------  ---------  --------- 
Net income                       $     473  $     484  $     793  $     374 
Interest expense net and loss on                                            
 extinguishment of debt                 87         79        180        137 
Income taxes                           371        338        444        251 
Depreciation and amortization          249        209        474        412 
Deferred rent                          (73)       (56)      (148)      (111)
Stock-based expense                     44         94         90        190 
                                 ---------  ---------  ---------  --------- 
Adjusted EBITDA                  $   1,151  $   1,148  $   1,833  $   1,253 
                                 =========  =========  =========  ========= 
                                                                            

About Zynex

Zynex (founded in 1996), operates under three primary business segments; Zynex Medical, Zynex NeuroDiagnostics and Zynex Monitoring Solutions. Zynex Medical engineers, manufactures, markets and sells its own design of electrotherapy medical devices for electrotherapy, used for pain management and rehabilitation. Zynex Medical's product lines are fully developed, FDA-cleared and commercially sold world-wide. Zynex NeuroDiagnostics, sells the company's proprietary NeuroMove device designed to help stroke and spinal cord injury patients and is currently expanding into markets for EMG, EEG, sleep pattern, auditory and nerve conductivity neurological diagnosis devices through product development and acquisitions. Zynex Monitoring Solutions, currently in the development stage, has been established to develop and market medical devices for non-invasive cardiac monitoring.
For additional information, please visit: http://www.ir-site.com/zynex/default.asp.

Safe Harbor Statement

Certain statements in this release are "forward-looking" and as such are subject to numerous risks and uncertainties. Actual results may vary significantly from the results expressed or implied in such statements. Factors that could cause actual results to materially differ from forward-looking statements include, but are not limited to, the need to obtain additional capital in order to grow our business, our ability to engage additional sales representatives, the success of such additional sales representatives, the need to obtain FDA clearance and CE marking of new products, the acceptance of new products as well as existing products by doctors and hospitals, larger competitors with greater financial resources, the need to keep pace with technological changes, our dependence on the reimbursement from insurance companies for products sold or rented to our customers, acceptance of our products by health insurance providers, our dependence on third party manufacturers to produce our goods on time and to our specifications, implementation of our sales strategy including a strong direct sales force, the uncertain outcome of pending material litigation and other risks described in our filings with the Securities and Exchange Commission including the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2011.

                                                                            
                                 ZYNEX, INC.                                
                    CONDENSED CONSOLIDATED BALANCE SHEETS                   
               (AMOUNTS IN THOUSANDS, EXCEPT NUMBER OF SHARES)              
                                                                            
                                                    June 30,    December 31,
                                                      2012          2011    
                                                 ------------- -------------
                                                  (UNAUDITED)               
ASSETS                                                                      
Current Assets:                                                             
Cash                                             $         623 $         789
Accounts receivable, net                                12,143        10,984
Inventory                                                6,554         4,556
Prepaid expenses                                           202           293
Deferred tax assets                                      1,469         1,384
Other current assets                                        44            42
                                                 ------------- -------------
                                                                            
    Total current assets                                21,035        18,048
                                                                            
Property and equipment, net                              3,684         3,422
Deposits                                                   168           170
Deferred financing fees, net                               123           145
Intangible assets, net                                     233             -
Goodwill                                                   251             -
                                                 ------------- -------------
                                                                            
  Total assets                                   $      25,494 $      21,785
                                                 ============= =============
                                                                            
LIABILITIES AND STOCKHOLDERS' EQUITY                                        
Current Liabilities:                                                        
Line of credit                                   $       5,201 $       3,289
Current portion of notes payable and other                                  
 obligations                                               139           131
Accounts payable                                         2,705         2,189
Income taxes payable                                     1,739         1,567
Accrued payroll and payroll taxes                          980           702
Deferred rent                                              334           296
Current portion of contingent consideration                 21             -
Other accrued liabilities                                1,376         1,574
                                                 ------------- -------------
                                                                            
    Total current liabilities                           12,495         9,748
                                                                            
Notes payable and other obligations, less                                   
 current portion                                           187           258
Deferred rent                                              970         1,156
Deferred tax liabilities                                   511           483
Warranty liability                                          20             -
Contingent consideration, less current portion             120             -
                                                 ------------- -------------
                                                                            
    Total liabilities                                   14,303        11,645
                                                 ------------- -------------
                                                                            
Stockholders' Equity:                                                       
Preferred stock, $.001 par value, 10,000,000                                
 shares authorized, no shares issued or                                     
 outstanding                                                 -             -
Common stock, $.001 par value, 100,000,000                                  
 shares authorized, 31,108,109 and 30,816,631                               
 shares issued and outstanding at June 30, 2012,                            
 and December 31, 2011, respectively.                       31            31
Paid-in capital                                          5,354         5,096
Retained earnings                                        5,806         5,013
                                                 ------------- -------------
                                                                            
    Total stockholders' equity                          11,191        10,140
                                                 ------------- -------------
                                                                            
  Total liabilities and stockholders' equity     $      25,494 $      21,785
                                                 ============= =============
                                                                            
                                                                            
                                ZYNEX, INC.                                 
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS               
     (UNAUDITED, AMOUNTS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)     
                                                                            
                            Three Months Ended         Six Months Ended     
                                 June 30,                  June 30,         
                         ------------------------  ------------------------ 
                             2012         2011         2012         2011    
                         -----------  -----------  -----------  ----------- 
Net revenue:                                                                
Rental                   $     2,437  $     2,447  $     4,499  $     4,895 
Sales                          7,589        5,948       14,471       10,133 
                         -----------  -----------  -----------  ----------- 
                              10,026        8,395       18,970       15,028 
                         -----------  -----------  -----------  ----------- 
                                                                            
Cost of revenue:                                                            
Rental                           273          392          531          726 
Sales                          1,513        1,335        3,068        2,445 
                         -----------  -----------  -----------  ----------- 
                               1,786        1,727        3,599        3,171 
                         -----------  -----------  -----------  ----------- 
                                                                            
Gross profit                   8,240        6,668       15,371       11,857 
                                                                            
                                                                            
Selling, general and                                                        
 administrative expense        7,308        5,769       13,953       11,097 
                         -----------  -----------  -----------  ----------- 
                                                                            
Income from operations           932          899        1,418          760 
                         -----------  -----------  -----------  ----------- 
                                                                            
Other income (expense):                                                     
Interest income                    -            1            -            1 
Interest expense                 (81)         (80)        (174)        (138)
Other income (expense)            (7)           2           (7)           2 
                         -----------  -----------  -----------  ----------- 
                                 (88)         (77)        (181)        (135)
                         -----------  -----------  -----------  ----------- 
                                                                            
Income before income tax         844          822        1,237          625 
                                                                            
Income tax expense               371          338          444          251 
                         -----------  -----------  -----------  ----------- 
                                                                            
Net income               $       473  $       484  $       793  $       374 
                         ===========  ===========  ===========  =========== 
                                                                            
                                                                            
Net income per share:                                                       
Basic                    $      0.02  $      0.02  $      0.03  $      0.01 
                         ===========  ===========  ===========  =========== 
                                                                            
Diluted                  $      0.02  $      0.02  $      0.03  $      0.01 
                         ===========  ===========  ===========  =========== 
                                                                            
                                                                            
Weighted average number                                                     
 of common shares                                                           
 outstanding:                                                               
Basic                     31,091,900   30,756,717   30,986,478   30,694,216 
                         ===========  ===========  ===========  =========== 
                                                                            
Diluted                   31,249,107   31,025,478   31,142,876   30,957,206 
                         ===========  ===========  ===========  =========== 
                                                                            
                                                                            
                                ZYNEX, INC.                                 
              CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS               
                     (UNAUDITED, AMOUNTS IN THOUSANDS)                      
                                                                            
                                                         Six Months Ended   
                                                             June 30,       
                                                       -------------------- 
                                                          2012       2011   
                                                       ---------  --------- 
Cash flows from operating activities:                                       
Net income                                             $     793  $     374 
Adjustments to reconcile net income to net cash used                        
 in operating activities:                                                   
Depreciation expense                                         432        389 
Accretion of contingent consideration                          6          - 
Provision for losses on uncollectible accounts                              
 receivable                                                  158        630 
Amortization of intangible assets                             18          - 
Amortization of financing fees                                24         23 
Issuance of common stock for services                          -         44 
Provision for obsolete inventory                             190          - 
Deferred rent                                               (148)      (111)
Employee stock-based compensation expense                     90        146 
Deferred tax benefit                                         (57)       (81)
Changes in operating assets and liabilities net of                          
 business acquisition (Note 3):                                             
    Accounts receivable                                   (1,317)    (2,834)
    Inventory                                             (2,093)       (93)
    Prepaid expenses                                          91          9 
    Deposit and other current assets                           3        (49)
    Accounts payable                                         516        145 
    Accrued liabilities                                       80        609 
    Income taxes payable                                     172       (192)
                                                       ---------  --------- 
                                                                            
Net cash used in operating activities                     (1,042)      (991)
                                                       ---------  --------- 
                                                                            
Cash flows from investing activities:                                       
  Purchases of equipment and inventory used for rental      (718)      (739)
  Cash paid for domain name                                  (18)         - 
  Cash paid for acquisition                                 (245)         - 
                                                       ---------  --------- 
                                                                            
Net cash used in investing activities                       (981)      (739)
                                                       ---------  --------- 
                                                                            
Cash flows from financing activities:                                       
  Net borrowings from line of credit                       1,912      1,934 
  Issuance of common stock                                    10         48 
  Deferred financing fees                                     (2)       (25)
  Payments on capital lease obligations                      (63)       (46)
                                                       ---------  --------- 
                                                                            
Net cash provided by financing activities                  1,857      1,911 
                                                                            
                                                       ---------  --------- 
                                                                            
Net increase in cash                                        (166)       181 
Cash at beginning of period                                  789        602 
                                                       ---------  --------- 
Cash at end of period                                  $     623  $     783 
                                                       =========  ========= 
                                                                            
Supplemental cash flow information:                                         
Interest paid                                          $     152  $     102 
Income taxes paid                                      $     365  $     525 
                                                                            
Supplemental disclosure of non-cash investing and                           
 financing activities:                                                      
Common stock issuances for business acquisition        $     158  $       - 
Increase in contingent consideration for business                           
 acquisition                                           $     141  $       - 

Contact:
Zynex, Inc.
Anthony Scalese
CFO
303-703-4906

Digg this    Bookmark with del.icio.us    Add to Newsvine

Technorati:


Read at BioSpace.com

comments powered by Disqus
Zynex
 
 

ADD TO DEL.ICIO.US    ADD TO DIGG    ADD TO FURL    ADD TO STUMBLEUPON    ADD TO TECHNORATI FAVORITES