IRMD - Earnings call transcript Q4 2019

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the IRadimed Corporation Fourth Quarter 2019 Financial Results Conference Call. Currently, 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, 2020, and contains time-sensitive information that is accurate only as of today.

results third financial 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 next being on the on call be the available the XX a company’s call is to and of This website website replay the for the days. broadcast live Internet at IRadimed.com, will

follows. as opening be McDonnell, will up before results Johnson, summarize call discuss today’s for and Chris of the Worldwide present up agenda Chief opening customer and will IRadimed’s of finally, will Officer the will Scott, comments; Leslie company’s questions. Executive and President The to call President Brent Marketing, IRadimed’s financial Sales orders; Officer, Executive Chief IRadimed, Vice then Financial

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

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

affect sec.gov. risks website company’s Factors of may SEC’s obtained the description that Exchange which filed and the Commission, the recent For a for from at company’s again with be see and reports section uncertainties please the most relevant business, free the may Risk of the Securities

I call McDonnell? IRadimed Corporation. Ms. President would to of now Officer to Executive and like turn the Chief McDonnell, over Leslie

Leslie McDonnell

revenue of of year. an everyone. Earlier fourth today, Thank announced over quarter you, quarter the increase we morning, million, and XXXX last fourth $XX.X XX% from good

$X.XX GAAP income of and non-GAAP reported share of diluted $X.XX also per diluted income share. net net per We

of very pleased business. our strength demonstrate and are underlying they with We the believe results these

These our From customers company back CE monitor, ship regulatory reduced another which Mark as for to the use all in XXX(k) our product competitiveness other letter, by us the increased for patient SpOX looking our the FDA the neonatal of the a claims receiving use orders the risk our made closing for for monitor, of proud and then I our in out our few increases signs patient include perspective, of warning am XXXX, the competitiveness. company. announced the achievements marketplace. a renewing and on and patiently of clearance COX and Now achievements decline FDA waited allowing October; competing to monitor patient expanding devices; for to vital the features throughout

regulatory revenue fourth the testament XX% full the a audits, to we over successfully addition commitment quarter and these perspective, over delivered a to year last is several XX% with our team increase which completed over a increase XXXX. compared a From achievements, In to record year our sales quality. to

record a our period achieved orders in for excess of XXXX in fourth high orders. also and first million We during the new quarter marked $XX

All CE was of our all we not achieved in sell during for patient monitor of could XXXX. nearly time when Mark a actively countries this

their orders XXXX considered cancel our to Mark, time, this a are and able were our we for our tender CE not without have first any not dynamic guidance. European in customers during we that in monitor While processes did quarter we encouraged this compete financial

have the a Succeeding leadership leader a Brent build Brent standard from Additionally, establishing growth a decision success is history medical new sales to sales care. to forward look delivering proven organization of is we continuing Johnson’s products a achieved. resulting who the when MaryBeth’s as MaryBeth technology We recently with in leadership Smith, announced of change we retire. upon and to

is discussion note. the Now to to XXXX, last to shifting one there prior item

We are work. with health remain not the return questions located we in to this event. a At this how and received impacted time, in coronavirus impacting them our China wish regarding and communication speedy good IRadimed. have is suppliers by We significantly

to update circumstances and monitor We will this you continue situation should change.

leverage I portfolio discussed tremendous knowledge last overcoming quarter and that our we that scalability that key the as the context priorities think potential the about deep environment. for product I current is of strength IRadimed believe I of MRI has challenges and and of in XXXX. our It initiatives

to MRI IV our initiatives priorities in revenue pump our share rates MRI and and growth our through and gaining First, is of patient list monitor. drive adoption higher market innovation for

launching second of detection ferromagnetic system on during FMD XXXX. the half or plan also the We

and XXX(k) our For longer-term plan on value mid-year. creation the IV to make pump still progress significant next-generation at acceleration, and submit to we continue

to to and technical needed education to Second, plans, support. sensibly commitment clinical growth our continuing infrastructure we plan support quality, invest while in our the

Third, and our productivity commercial strong and patient previously competitor. sole-sourced manager we leveraging focus and continue on with expect contracts were to GPO IDN recent footprint after considering especially adding gains, our a to monitor sales that successes our

external about team we can commercial exploring opportunistic further our expertise. leverage our we technical and be where Additionally, technologies will

look to markets in additional accelerate have value I deliver technologies and we regional that by we Finally, to providing targeted novel significant growth clinicians believe international support. patients.

intend patients that or of requiring of unique products higher care. Our while challenges products continue signs and innovative in environment infusion are the critically facilitate delivering create driving MRI vital accurate standard and sedation, awareness developing monitoring. eliminating MRI a project and tiles ill who to access risk the We the for of

for Now, full I our year the quickly will summarize first XXXX. and quarter financial the guidance

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

forecasted tax effective guidance which the to impacts XXXX, full We our negatively are expecting results. XXXX to the XXXX of comparison higher earnings year compared rate during XXXX a

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

to includes renew monitor impact needed of mentioned, time our in previously CE revenue processes not guidance quarter during to first being participate expected patient Mark. As the our the tender any able

a now discussion will Brent I call the organization. sales to turn of the for over

Brent Johnson

Leslie, and everyone. good you, morning, Thank

her total record strong between categories. all in well IV worldwide mentioned quarter Leslie team U.S. As quarter the was This was quarter in monitors, in a fourth increase sales pumps and international and with booking solid growth balanced and delivering teams overall orders. our record the remarks, for between a booking

strategy Our many we’ve that continuing from main our prior aggressively pump critical times monitor with growth, are MRI taking we competitor on increases care solution. IV transportable discussed solid our in calls, deliver market share is and to

past could a Mark marketplace the not quarter which the discussed in EU that even the been to orders the also due was we book issue worldwide sales the year the fact, resolved. monitor, record in CE fact In light of now for of MRI booking of quarter earlier, in most has

in being which will impacted ramping to the participate for add XXXX, EU we’re we in this XXXX. we are our continue further tender business EU the these area to inability our While processes most expect growth of up in sales to countries, efforts of by the monitor with throughout

monitoring Another and roughly This the factor business compete signing MRI that gives the breaks for sales our with the our in with of a footing nation. our the covers half in an largest equal monitor source organization hospitals our U.S. base and agreement that agreement competitor for future, QX on the in sole this to monitor opportunity agreement an GPO’s for group member for largest the the helped purchasing with salespeople

U.S. quarter, our two of U.S. the with field. continued also a total hires additional with sales deployed team for XX sales expansion in fourth in people now the We

have critical consistently product We’ve hires additional the offering, into we and and translating these with mass our demonstrated now need success compete we current in sales to increased sales win. that

support our commercial basis. increase our both team on productivity XXXX, We and overall hires in to internationally, investments also but where training will on increased continue concentration we’re needed a U.S. in recent per-person and the making in putting additional with

we Our proven with will growth us GPOs now record deliver the IDNs, and growth wins solid confidence this and strategy continue in the quarters. to and give of future contract with that

growth you – combination IRadimed products her patient planned after to care unique quarter of an clear new of last first and decided As sales for products, already MRI regulatory IRadimed expanded a the retire with begun Smith. along that positioned the I’ve under team, innovative With a announced well environment, is leadership. my product month transitioning MaryBeth and end duties know, I’ve to

thank lead years, efforts look commercialization IRadimed’s the I past want success. over continuing for to and eight to everyone IRadimed’s the opportunity forward I to seeing

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

Chris Scott

you, Thank well our as Today, I’ll morning. be on as financial discussing and basis. GAAP a good results basis non-GAAP a on

tax exclude taxes. expense taxes non-GAAP the items are stock-based effects. Our operating the items excluded nature on of for for income our frequent from normal And based and indicative considered not provision are as their results related these provision tax income and compensation

the purchases our our financial statements, these presentation helpful a operations less along flow cash in and flow Free measures from thorough equipment. be ongoing believe cash of GAAP for property is of analysis We non-GAAP more with used can financial providing performance. cash of

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

we this driven all quarter from increase. quarter XXXX, was million, XX% over across XXXX This for by the Revenue to the XX.X% for fourth year. devices compared As a increased stated the XXXX was growth revenue morning fourth ago, fourth few reported $X.X fourth a and moments line million increase quarter last $X.X continued quarter items.

Revenue for compared quarter, MRI for increase. million current Included our in of quarter, XXXX from the quarter $X.X XX.X% a to XX.X% for to is million and the increase. the devices quarter, $X.X was disposables, $X from services other million million $X.X the a XXXX sales revenue in compared monitor for XXXX

the maintenance amortization to our revenue the was renewal lastly, for XXXX quarter million which XXXX, last compared was of increase for that $X.X current shipment a the from And the million extended was revenue held were revenue the to sales, of increase. XXXX approximately over by $XXX,XXX quarter was a monitors million from XX.X% the of for the previously And fourth quarter, awaiting international $XXX,XXX, impacted for $X.X million $X quarter. contracts the quarter year. CE fourth compared $X.X favorably of X.X% Mark, Domestic

of approximately in higher $XX,XXX quarter. to in $XX,XXX ASP The quarter. the sales international $XX,XXX The a quarter for was XXXX the year quarter. the IV XXXXand the fourth of approximately decrease XXXX $XX,XXX of compared was the our XXXX approximately unit quarter for quarter the for for during result to revenue recognized during pumps is prior current average price selling compared MRI monitor ASP

when gross ASP higher sales the the quarter The as and XXXX. to decrease quarter a due in international for fourth of current XXXX XX.X% international was decrease Gross in quarter. of fourth during The year to the the higher prior percent margin the quarter. compared sales XX.X% is XXXX margin for quarter compared to result

payroll for of On or XX.X% expenses $X.X expense, benefits, basis, XXXX recruiting the quarter costs, to regulatory due were expenses to higher revenue. and compared million expenses revenue operating XX.X% of fourth dollar approval commissions. compensation Operating and or for stock million $X.X a employee relocation sales costs and increased

to rate units. rate effective with The of quarter quarter. XXXX the sale restricted for effective options the the due benefits primarily stock Our tax employee is to vesting XX.X% XXXX higher X% associated of and negative compared tax exercise lower for and tax was

On $XX.X provided favorably net year. perspective, the cash from income the diluted was diluted share rate. cash last for lower of a non-GAAP was fourth a quarter compared quarter GAAP by From XXXX, ended operations current by flow $X.XX impacted basis, $X.XX fourth fourth the per a net the compared XXXX. million the were $X.XX Both per the $X.XX year per the tax year. XXXX to for for GAAP for XX, was to basis, earnings $X.X effective share for and XXXX, million income December On compared approximately share for quarter, $X.XX quarter to non-GAAP

current by benefits, net XXXX, to impacts by higher accounts impacted other prepaid payroll accrued increase negative in accrued an and cash receivable, revenue, and offset deferred expenses other taxes Turning was by provided income, and positively from operations partially assets.

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

turn now will the call over I Operator? for questions.

Operator

[Operator Henry from Roth Capital. Instructions] Scott with Our you. comes first question Thank

now is open. Your line

Scott Henry

as should any about XXXX and, about and A couple think point, morning. impact starters, that have you off? Or as we news selling guess, we’ll how filed for XXXX the think the that? when some as that comes XXX(k). well pump of kind cycle, I generation at I and hold you you as Do in account on kind about questions. the next Thank will as of guess, we of good comes about think that

Brent Johnson

interesting. is this question. a Scott, good don’t it’s Well, in Brent it’s that We Yes, have – Johnson. a competitor marketplace. The

them our there’s affect demand for on and products a to an doesn’t did it us as So buyers if continue as much ongoing we buy competitor. have a high Certainly, basis.

in may some program, get our here bridge closer the of sort we like to XXXX. that type some to as a foresee in any in efforts for of we be anything that, don’t as far but a As impact there future necessity time near-term the selling

Scott Henry

Okay. think the but about are obviously When we throughout guess, monitor year, sales, in seasonality as we XXXX. much, about how about QX of very a should think trajectory should again, I we helped perhaps we’d QX expect by downtick into of think in is and which quite monitor ramping the strong that international, how sales kind XXXX? not and in

Brent Johnson

show the a is The seasonality experience there as sales. that of fourth for with of quarter strong about in talking quarter certain with QX product, But is a bit as are calendar you’re there seeing increases Yes. device far I strongest market. in that we devices. ordering. a mean medical drop-off little our your medical year the typically typically there does the

– don’t there that with monitor – as patient product, some a seasonality business. So excuse is that QX. drop-off with see sales as in in product the MRI far especially But me, again, we orders with

Scott Henry

about when to QX question of, sort maybe about we Okay. think reflective? Or XXXX, should to how hurt was by margins? sense think opposed Obviously, just maybe the international any QX just about gross we Would more think directionally, relative the as And then volume. final be we gross margins QX? of QX how

Chris Scott

of quarter the exactly Scott we depressed gross business I Chris large international because did. here. right. see, in that Scott, part, mean, Yes. were margins We Fourth you’re

I so international back we we and historically of that’s see modeled coming as we shipment have unit remove into that see that rest which the sales total range. of the mid- mid-XXs, the said, the played, $XXX,XXX EU output into it to And increases over see we’ve normalize increases output that impact – like year. mix normalized We revenue. quarter-over-quarter, relative as upper-XXs We and where how for is to see also geographic the time. normalize And as margins in do but

Scott Henry

you you Thank for taking Great. Okay. and that for the thank for questions. color

Chris Scott

Scott. lot, a Thanks

Operator

Instructions] with you. comes our Research. Lisa Thank question Singular next from Springer [Operator

now Your is line open.

Lisa Springer

quarter a and congratulations morning year. and strong Good good on a

Brent Johnson

Thanks, Lisa.

Lisa Springer

discussed this could going Thank you. you the a starting you new I testing to the yet – I on status – is? this of give more initial of happened us progress that wanted what pump? to the year. early were little know infusion specifics I has you or if wonder

Brent Johnson

Leslie I We us that’s Lisa, off direction. the think to we’re shift a mentioned, committed that we cause submitting going now timeframe. of and remain make in see anything XXX(k) at to midyear, to don’t as progressing that right

we So kind all on I that now. have the that’s comments that think of right

Lisa Springer

the your feel you Or do more in that you to goals? perhaps we could XXXX have And sales accomplish hires the see sales during Okay. team place year?

Leslie McDonnell

question. Hey, take Lisa. that I Leslie This can is McDonnell.

We’ll the were the make required. you’ve It as this our we have be think at need I that in same commercial largely in additional seen quite pace hit year. won’t team past. for to we the goals place investments

bit focus on We’re going well. turn our a more with balancing little some that productivity to of as

Lisa Springer

is a leverage question. an And organization, the I’m balance you product? interested bit just might would another that – the on acquisition wondering be Or sheet. in final what Okay. my what There’s of your making help quite would cash you area? in that sales be the opportunity

Leslie McDonnell

to monitoring things portfolio. to at and profitable signs also for some We Yes. leverage delivery, take is electromechanical that through of criteria we’ll Those it cash the because types from technologies in mentioned call of at good things that that make fluid sense a a open. prepared we’ve but where available the some sheet. And the over of the those we our technical Software-controlled as What is what available precise the are We sort look call-point thinking to footprint, might have us how time. from balance on the remarks, perspective, so in right? are would domains looking definitely, systems, be been past, opportunistic commercial vital I we network, us doing at a plan and about that generally, become And become I of here, is lens I’m processing. of part may distributor through about of other makes there expertise. we’re

Lisa Springer

very much. Okay. Thanks

Leslie McDonnell

Thanks, Lisa.

Operator

not I’m any I you. turn remarks. closing at showing Thank further this questions time. McDonnell the over would to call any like back now Leslie for to

Leslie McDonnell

investments morning. working are for value quarter. call thank exciting there forward to a and everyone the would implementing are look creation this sensible you we you team, participating believe after on in progress innovation, opportunities with efficiencies. And through updating and that on I focused on the are of We like and ahead our speaking us. developing I and to plans as listening first

Operator

Thank This concludes you. the call.

disconnect. now may You

IRadimed (IRMD) 6 Feb 202019 Q4 Earnings call transcript