IRMD - Earnings call transcript Q4 2018

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Operator

Ladies and gentlemen thank you for standing by. Welcome to the iRadimed Corporation Fourth Quarter 2018 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session.

As a reminder, this conference call is being recorded today, February 6, 2019 and contains time-sensitive information that is accurate only as of today. results fourth final XXXX. released iRadimed for quarter the Earlier, the press is on A iRadimed.com. this announcing their Company's at News copy of heading release earnings the available website under the release and X-K be found also press on can the sec.gov. of Exchange Commission copy furnished A to Securities at and Form was over XX being the call the will available Internet on Company's days. replay website call is the a the This at for of next the website broadcast live and iRadimed.com, and be will be call follows. The today's agenda as for Susi, Brent Vice of Marketing up for comments Worldwide before Roger Officer and Chief will iRadimed Financial summarize Officer questions. and Chief orders; will President Executive results Johnson, opening and the finally, the present opening iRadimed's, financial Chris will Sales President call then discuss customer Executive Scott, iRadimed's of Company's

of be information statements Act the in meaning will Litigation session the to of within today's Reform constitute Private Securities forward-looking of XXXX. the Some furnished

focused and forward-looking the factors. results, may those to you performance, that materially on future future Company's are of number a XXXX. due reminds for these from the statements results differ include Forward-looking iRadimed the events statements results and risk plans expected

And from the description go free the with Company's and to affect Roger risks For business, my and the website Please the Exchange to section it's Securities sec.gov. Company's Susi. the pleasure may ahead. Factors uncertainties may obtained please from again that of a most be relevant recent filed turn see Risk the of the report which at call Commission, SEC

Roger Susi

and Thank you good morning.

share income diluted of this of report of $X.XX $X.X net per GAAP XXXX and pleased quarter income to revenue very are morning non-GAAP We $X.XX per diluted share. million, fourth

On GAAP XX.X% sequential year, basis, revenue year. fourth X.X%. to compared both significantly increased earnings the than higher our non-GAAP quarter the As last revenue and a last increased of with

and coming by from patient from higher offerings, system and approximately that sales XX.X% XX.X% XXXX, of For iRadimed. XX% find approximately monitoring the viability our our pumps. these of of as increased with of collective everyone IV of our very the of full product powerful I year efforts demonstrative gratifying higher well revenue sales growth coming as at results

made would briefly to new we our review EC have our the like progress pipeline, regarding expiration our I to recent product relative Certificate XXXX. XXnd January Before announcement reviewing of of published

necessary listing prior always Discussion and scope each monitoring body certainly As a negotiation been periodically to our we soon press the past lapse of noted CE the a we this Unfortunately before communications complex to with of from have using review uneventful. future and still within and Recently, CE press time, notified second and understanding the our those certification a quarter usual not regarding as countries us follow-up and expect clear expectations return method, CE to release, bodies rather we clouded with however, led our and to include release, as were product Thus have ability discussions MRI confused our the of this regarding was now have to apparent system. into that efforts thereafter. in via have label to yet in the surprised date. new The straightforward the positive our our deadline. again reached always in renewed being conclusion to with as authority body, documentation notified expiration and has requirement a had meet notified giving able shipments the path once end EC forward. better effort the we and XXXX do marking XXXX

in With IV to XXXX and other to in held EU new still time, calendar any next CE enhanced this countries. due in expect our in hang-up now are maintain pump matter next devices -- safety does that and regard effect or not is adjustments. for this EC on and that the countries lapse continue into itself pump and early XXXX strong by EU significantly XXXXs our I to or already I being of disposables, to release there shipments the concern, our field shipping impact is no only clear, was progress generation to At product generation be The to this marketing. project without made XXXX. in Just are not development, that selling in

made our the also magnetic for have device, late on we remain detection progress track Additionally, XXXX on FMD, and launch. in a XXXX

we is commercialization. accordingly do a device a not not product FDA medical the As prior an magnetic require and clearance to reminder, detection

Now full I'd the first like the and of to outline for year our quarter financial XXXX. guidance

full to the share per non-GAAP million to revenues earnings we million, of XX% expect share $XX.X earnings of $XX.X and diluted to XX% GAAP of XXXX, year $X.XX. For per $X.XX

diluted $X.XX. million earnings $X.XX the $X.X of $X.XX, per of share of XXXX, earnings For first share to quarter $X.X expect to $X.XX to revenue we million, non-GAAP per and GAAP

than quarter CE includes first to impact and Mark of of customer over I'd year year less our orders. full issue, negatively the now, And revenues Brent for discussion to guidance like will and call believe X%. the we by which Our full the our impact sales turn

Brent Johnson

year quarter strong of the international capped-up domestic the Thanks and Roger, another increases morning fourth everyone. a parts both quarter booking sales and good business. The of was in the for our and great team

the areas monitor. to fully has and another away customers this share the competitors. patient balance is recognizing their are team take patient pump solid and the and side, and full the patient products to Patient a unique to pumps saw we're increases the sale the second On new sustained able both sales now workflow a close XXXX. market our growth the big strong advantages business. monitors speed The the highlights a two efforts of of with product team a our on between monitoring quarter to continued with were which year compared our great sustained and safety and believe that successfully with on internationally, patient of in the the from in ability domestic with strong and international year in the our of grow that the continued pumps expecting come patient record at kind orders our international of in IV increased prior bookings predictor market they're IV monitor and year particularly monitor of both year the shows IV full We good of a second in booking growth is US a up growth in market The the both quarter growth. monitors when indicator we a good both had and product

domestic the bundling to IV with international we're continue seeing of with new our succeed monitor both our and and sales success We opportunities patient in strategy our have pump the business. areas and this

allows only As as market. customers offering differentiator previously to back changeovers. bundling our and the This iRadimed to without our the anything in system is a we and our world the differentiate MRI capability mobile concept a discussed, in IV really with between multiple with combined sale, product enhanced it's truly resonates we pump hospitals the to offering, patients that by for the having monitor and into with key iRadimed's safety Company really care workflow and product a transporting make and provide else time-consuming equipment

multiple the on multiple the often procedure. critical due continued the medications workflow also orders. more with care and increased demand targeting transportable IV Our it pumps continued areas care channels our of during traditional as to the sales expand care, the pump multiple seeing IV IV for our pump must as drive departments strategy for see MRI it in of critical and targeting and patient the benefits new follows critical By but well market safety be hospital them benefits offers increased interest in sales we're to demand MRI. driving educating purchases are patient our and increased workaround potential channel to to IV critical pumps, for We're their MRI on solution an hospital to we're of versus for also pump patients solution, driving MRI with monitor, the of great unique pump as that great not only care demand

we expand team marketplace. we're better the continuing to our to As XXXX, begin sales penetrate

On to managers territory add additional director give XX the of to of XX a we've an and have year. end of domestic managers total before team six area the sales direct existing added fourth a side sales our us plans to the

clinical to us We specialist on add give additional one team. applications total of six also our plan to a clinical support

we've we've experienced an the Singapore the Asia international those hired based Pacific, On the areas to that Director growth side, world. to of East continue in in sales expand Middle

financial I'll Chris it to to results. Now, over summarize turn the

Chris Scott

our I'll a non-GAAP a Good on well basis, results as GAAP on morning. basis. as be discussing financial

effects. expense Our the non-GAAP compensation tax excludes operating and results stock-based related

property normal are and based nature Infrequent for of of a of from income our our not measure financial or flow in provision operations flow provision less used items presentation thorough financial cash We believe for of be providing these analysis excluded cash are free measures, on from is Our as purchases taxes ongoing tax more statements cash GAAP with along their these indicative costs and for can our considered non-GAAP performance. the income future helpful taxes. equipment.

measure non-GAAP on these today's find GAAP page the press measures release. You reconciliation nearest the a can last to of of

period. monitor, was patient million $X.X sales the million from for revenue stated, And the million current disposables compared to XXXX MRI quarter. revenue and same million As compared same current revenue the XXXX million for $X.X million ratio total was of of ASP year. fourth sales devices as quarter. quarter for higher quarter million extended $X.X $XX,XXX, maintenance million the price pump and Fourth devices for $X.X million quarter, the from same for $X.X Included from compared $XX,XXX from approximately patient $XX,XXX and increase we respectively. and million for signs quarter unit domestic million year. approximately to we last the mix compatible fourth million year. $X.X to a million during quarter services monitoring is sales contracts XXXX, The of XXXX of quarter unit unit a was fourth reported to international the was last our quarter for compared XXXX quarter. Roger the for was favorable a $X.X to our $X quarters sold was of the product million, sales unit XXXX ratio domestic pumps the $X.X the average quarter selling the XXXX for the to our XXXX more of system quarter last $X.X $X.X XXXX in XXXX in period. vital total of to lastly, result for from compared to fourth for also the to quarter Revenue domestic same XXXX amortization quarter is XXXX, monitor higher XXXX in for in ASP compared last $X.X sales for pump year. for the This the signs XXXX IV $XX,XXX recognized in to monitor to compared in revenue Revenue Revenue due to vital revenue when increase quarter approximately was the fourth $X.X compared and in ASP pump quarter approximately $X.X sales a The the accessories of quarter. the when is compared

reminder, of increased of revenue, XXXX revenue, XXXX. as for and the fourth a was in of XXX(k) the favorable variance to for quarter last adjustments stock current dollar margin margin of quarter result XX.X% the compared million lower headcount, Operating offset percent revenue the payroll higher the XXXX gross million XXXX FDA legal higher in increase quarter US compensation partially fourth expenses $X.X and sales due basis, after a from the monitor total year. operating revenue the quarter higher professional in On percent and sales a expenses expense. XX.X% As The quarter commenced expenses to overhead higher XX.X% from to compared higher or clearance. sales $X.X of expenses, the fourth for is domestic fourth commissions when were and or higher for by XX.X% Gross the receiving quarter.

from X% for -- effective effective Cuts rate The for the due compared period. Jobs a Tax quarter tax the federal statutory effective lower XXXX the lower to and current rate is Our to resulting was XX.X% Act. rate, primarily tax lower

that rate income as were deferred net approximately Additionally, XXXX causing the current $X.XX quarter the taxes the basis, per quarter a the per the share to the Jobs last diluted And during GAAP $X.XX the compared year. was quarter one-time our fourth period. required for effective was Tax recognize current a charge impacted for compared diluted $X.XX to share, Act to on fourth Cuts for us income quarter quarter, for and we net a to year. non-GAAP revalue On of $XXX,XXX negatively $X.XX during basis, last

$X.X December was income the same year-ended offset higher result for XXXX, the increased outflow partially XXXX. the For million provided income, for of operations by to XXst $X.X in million compared primarily by cash tax cash This period payments. higher net

XXXX For XXst respectively. flow, $X.X the year cash and December a $X.X non-GAAP was million free and million XXXX, ended our measure,

As exited a investments for backlog of and call cash million of I'll year that, With in December XXst XXXX, the with $X.X $XX.X we of the over approximately million. turn questions. had

Operator

begin the And with session. our Securities. is question-and-answer Thank CJS Instructions] you. And from first we Larry [Operator will now question Solow

is line open. Your now

Larry Solow

pump what or just the an idea expectations growth on us both can get color and is just a the give color or monitor little either Appreciate thanks. Great, are so where quarter we maybe you from? coming the Can for or outlook. sort breakout maybe more on the the your the of the

Brent Johnson

the the XXXX period? for Larry, period XXXX or

Larry Solow

XXXX.

Brent Johnson

I haven't mean, product by typically launch. guidance we given

Larry Solow

color guess Well, mean of when color the first sort know that. market, those had to million I and not so you year have monitor you them, last was on and that sort sales some still I Anything from of some on the it's I of run the sort on -- monitor. be maybe to in any be know $XX sort I to expected would of couple to rate great, first I guess I play, the just monitor expected Is that? -- know expanding years. I are think reach, just but next replace couple of said, the the over of I you launched guided the think in

Roger Susi

is maybe Yeah, I'll this on Larry, Well, this step in Roger. one.

new one pleased in as grew strong, the out starting business worried monitor last the domestically that Turned they pump earlier the year demonstrates that And that and sales selling in So right of direction. Brent speed both of the patient just point. would both that to life which sales also call force monitor has the rather that past now. year. monitor were year works We that we patient and in little been shiny our of that, as we in balance it's monitor fact same that in took fallback that gravitate that sell IV the was able And come and that selling that to versus half for to we're out has both they pumps, force up to been pleasantly grew them. see the you can the at introductory the a bit businesses. other both the them to said we to course force sales have sake the the did find said, products not see a able for being yield Brent together, and due We

in year, starting XXXX this that in see pump. where had if the we're in the the but that fitting now this a -- that our it overshadow stuff maybe that with the $XXX year, we forget anything, starts is coming newly I eventually out, or five-year last growth better patient pocket growth and start hoped. spring, this not business right that as launched pointed million think just monitor. probably we the don't see of weakening, goal, new you'll parallel to year And part so five getting goal all having In has introduced And goal, to we the then soon, by certainly short-term as has pump we

get we that hitting this and long over to least -- expectations good and exceeded -- Hope your that $XXX our continue. not growth if are this answers that to happening, both period involves that that far things our both in growth to see million and expect we strategy period question. So met, so at

Larry Solow

Europe. drop is seems $X impact And of what -- that, like less it million small but sell year guidance to your or just the to a up is outlook sure. to ability the have back-end monitor at about the growth it outlook the midpoint XX% bit the Yes, of XX% a the loaded. piece close little full temporary the I to, like is obviously, -- just looks loss so of XX% in of of QX, But you sort from realize than growth. for about

detector So of you in believe is the expect any monitor? function this magnetic I -- of any a it guidance return the the of year. this don't just of your Do you sales have

that So driving is that there nature? it else or anything just back-end of sort of more sort loaded of is

Chris Scott

did back-end that story, as similar is nature we think XXXX, a same in right? I it's

Brent Johnson

And at when going area. of it, us more be the -- greatly course, look because is year in issue that's the think impacted than the rest you QX I if the to because Mark Larry, affecting is of impacted CE

So second we the expect in mediate that to, as Roger quarter. said,

And so, that the that the of any would yeah, that of you're is otherwise, mean looking balanced that at front-end of pretty so most approached and really, a be effect I year. just to loaded, effect

Larry Solow

Okay, fair enough.

quick margin? absorption sort got for the any Chris. little around this possibility it looks a year Is what cost sort or on fairly bit that like. XX%, constant higher margin of side forward you a improved be of Gross you seems bit in going little or question it drove expect efficiencies held Just that to over a of and

Chris Scott

we certainly We of help to more to side. equation the costs, on and the in new some some side pump absorb but more on do out units monitor come products efficiencies pump the to year as expect this units, overhead the

of expect we do So a bit little creep.

Operator

from follow-up Larry Solow. a Okay, Instructions] [Operator ahead. have Please you. Thank we go

Larry Solow

Great. Thanks.

-- on side, domestic are of pricing, I anecdotally? on actions your price your competitor two was you terms just by monitor terms any side, questions. guess Have in as In of the of sort at before last of that that you you least couple your quarters? has on reactions number over their increased the And domestically? competitor -- is the realizing $XX,XXX-ish discounts had --

Brent Johnson

about the different I Larry, version of you're options overall again each if the there selling talking future is with price, mean, monitor. remember

a more where And north number basically of So you we as domestically. price I little few less. are thought again their that I number and there than as you bit bit any it's little been terms an some mean in price. for mean far much and But far yeah, selling would mean between whole as our again a sell be of selling to significantly dropped just tracking than selling we mentioned I $XX,XXX that hasn't to for been think a average yeah, expected we their be It's measurable to difference And reaction again, competition difference us, pricing. mentioned. I there we aggressively time. their a our pretty haven't where really as the -- and price they sell

Larry Solow

more improve And into outside -- of pump sort focused ER Has obviously of orders that Okay. -- the or some focus? mentioned and a that in MRI on seeing -- on remains you you -- And of bit into are the critical larger department. the constant little orders has the side, care quarters? continued the to with suite on traction last terms that perhaps two the

Brent Johnson

-- they ones IV ones care that answered the they've the see the the the it, and between strategy the care about above. past to it's using Yeah, that in pump drives the to our as I when differences Those product. using all solutions that areas the so drives I've more critical we I that talked for as patient, demand radiology. compatible critical speak. workaround The demand continuing and again that are MRI demand to in call more yes been the own drive of mean

when the are talked even typically that those are talked before, with off that we've of drives upwards of lot lines of continued as the And come but they when of need three, dealing to they can't four, you're out about MRI. with -- critical about to purchases that we've care, still or patients So that more you're and interest radiology made demand be more purchases. that department, go need sometimes a as in

pump channels, the more drives for demand that more channels, for pump drives in it again it results So more pumps. demand which

which more, the dual answer to more as pump and pumps we define well final three more saw or as two and that pumps previous also in is, sales are significantly the So we're that or pumps, single seeing from multi-pump increasing past. we question more those yes,

effective So see we strategy really the sales continuing being and IV pump as to growth. again, drive

Larry Solow

Okay.

will it pretty for Just a that take XX% a which going from add I positive you not guys sign. Chris. I the the would you question guess as more as as going a quarters throughout side, XX%, are direct it progress. up to Chris, looks increase I XX%, I SG&A sales on the nice side it year, assume assume SG&A, expecting on but guidance rise should incrementally like

Chris Scott

got That's the to correct. increase I the mean, OpEx most for I've mean, the breakout line. growth, the sales coming I and part of most I marketing in got, OpEx line most from of

Just things that. as higher you sales like higher pushes, mentioned higher sales headcount, commissions

bulk of the growth is OpEx. that's coming on through the where So the

Larry Solow

in then your sort tax benefit and have obviously the terms some this tax for What things And rate, in stock you year. from the Right. 'XX gotten other rate? on incorporated guidance of comp of

Chris Scott

it's rate. tend little do I purposes, to XX% more around model a conservative, I and modeling XX.X% For be

Larry Solow

will just couple customer they it years. sort of to in over generation that or tipping Without that's anything pump with it last your us for be then or a will share for the And question will might competitive Okay. as next on expected on enhancements kind desire? And hand can have? you they what required Roger features of reasons, of switch out be

Roger Susi

questions. Good

to why adopt to to why real to quicker think over to we're So change and will be to thing and want a going will be sexier. and forth. so But be doing it's yeah, people real, I attractive and lighter say want is. the that it going this we smaller in mean I'd going word, it's the and it's pump people to a, it highlight It's new

they'll the the system the over pumps doesn't addressed our Achilles we've XXX, hospital in whole pump. entire They know equip pumps. think a then buy XXX big call typically them I I an one time, the the with, from that of XXX, is pump that this heel for you few facility three of they're convert buy players, to current to the going and this

very they users room when that every the if, then the so to that And floor. get they use stop in accustomed is, clinicians on MRI, pumps are thing. have in they using and and accustomed have think get that buttons every the patient's ours and those very every the they the of And mean that in do and few of to sort a what think, to screens they have what about and bit ICU

into pump to as walk other So phonebook. want New written to manual graphics be than tags higher this an with learn the I'd and And the will City fancy coach user as The display we be, through use iPhone but hang right, use a take graphics in phone to the for the this manuals we refer that's you with we're like what to thing is want York can the it'd yet, we think probably resolution the a biggest or the much operator's we people unit. almost that, and phone. The be We've that intuitive your instructions parallel screen, how to we're how with Samsung phone the on target so we through putting we it. that graphics, thick simple, think doing biggest and that, to to fancier a to Rather interactive telephone and itself. today, design somewhat think whatever or have to your sort read with just graphics goal today's of new sounds have to we a the higher, pump. it say, displays, people do having did used manual be the walk through don't

Larry Solow

Got it. That's Great, helpful. thanks.

Roger Susi

scheduled these typically on then people just kind year it replace five Yeah. And when are things replacement their of hospital gets, in like the hardware naturally is device schedule. replacement equipment to a do

older of pumps than that to we'll So X,XXXs, updating. have are subject years be X,XXXs that will five

Operator

from And go you. question Capital. Scott is ROTH ahead. Thank Instructions] with next Please [Operator Henry

Scott Henry

thank the you for taking Hi, questions.

Just a couple things.

First think that that bit? to FMD about magnetic you. detection should with just product, the that product ramp? And product, me you could a the little sense of device, and Thank about a talk how for just regards revenue the give we potential

Roger Susi

simple. you pretty It's, walk it gateway it's In to at doorway somewhat case, this that the that be like think gates for weapons, build airport similar It's we of Sure. a those through screen the into it's that, going right. to to thing, looking ferrous freestanding the arch our the the In metal. going MRI detect. purpose into rather than the at a kind looking to just the metal, in case, only airport is look But middle its of room. whereas we're for anything for

that's wheelchair, MRI it's device there that's a purse that we than may like the looks size somebody different technology used ferromagnetic that. in and particles hazardous and way entry what it and want purpose like, to something a the into the built But door be airport. in like gateway of up they a bit an could their carrying a around or pick on in, little is So ones jam it have

doorway. whether the that's And of which magnetic of doing they segment So inside from they're pumps, cases. purpose guided incentives MRI, I freestanding scanner, their of or they're as a IV and sorts size, high in all liability in it. to the that more is This a MRI an form that keep imaging are the have These to laid the high have around getting devices every put something things acuity getting, all things market a size in, a has out, screening things whether hazardous room. acuity unlike being hospital these magnetic center, they're used

that It's purpose, but than just them So of these same for to market, market call on. some broader lesser of ignore reaching this it's acute this centers the device. to rather the we sell be it's sort we'd out

IV sellable we the number but pump, or in either for quite of scanners. are a the have bit larger monitor quantities than than all the So it's opportunity

Scott Henry

estimate how would kind should how market that And about if of think And you size? addressable we Okay. penetration could? you

Roger Susi

all XX,XXX the of we a of order needing so of It's this scanners, now, think has a penetration that in far around what There these X,XXX, all thousand, kinds world, are area X,XXX. devices. it's the couple couple are they're of them potentially relatively and the kind light, proprietorship been of of businesses small

So runway there yet. a to is long go

Scott Henry

thank outlook ASP, a that Chris. about pricing we you program. color XXXX? should to for for Okay, pricing? similar a Do benefit expect just for how And question for modeling monitors or you regards great, the the either think should about With pumps or the think on quick much we

Chris Scott

I think we full a XXXX. for spoke sticking ASPs about year it's pretty the at bet with safe looking that

Scott Henry

taking you Thank great. the questions. Okay, for

Operator

you. I'm queue. for questions any showing the like turn to back further final And to would in I not it Thank any iRadimed remarks.

Roger Susi

you Thank again, operator.

to company forward well, $XXX product we participating So we goal place we sights. the keep and million today's I in development again back that ever look to after Thank strategies call while you clearly correct the believe performing growth quarter. our is long-term for in have the viewpoint sales and first you both our from my ensure reporting in and our to

Brent Johnson

everyone. Thanks,

Operator

this And you. concludes Thank the call.

now You disconnect. may

IRadimed (IRMD) 6 Feb 192018 Q4 Earnings call transcript