IRADIMED CORPORATION (NASDAQ:IRMD), the only known provider of non-magnetic intravenous (IV) infusion pump systems that are designed to be safe for use during magnetic resonance imaging (MRI) procedures, today announced financial results for the three and nine months ended September 30, 2016.
For the third quarter ended September 30, 2016, the Company reported revenue of $7.7 million compared to $8.2 million for the third quarter 2015. Revenue for the third quarters ended September 30, 2016 and 2015 included approximately $3.4 million and $2.4 million from backlog, respectively. Gross profit margin was 81.7%, compared to 80.6% for the third quarter 2015. Net income was $1.6 million compared to $1.9 million for the third quarter 2015 and diluted earnings per share was $0.13 compared to $0.15 for the third quarter 2015.
Non-GAAP net income was $1.7 million for the third quarter ended September 30, 2016 compared to $2.3 million for the same period in 2015. Non-GAAP diluted earnings per share was $0.14 compared to $0.19 for the same period in 2015. Free cash flow was $3.3 million for the third quarter 2016.
For the nine months ended September 30, 2016, the Company reported revenue of $26.5 million compared to $22.8 million for the third quarter 2015. Revenue for the nine months ended September 30, 2016 and 2015 included approximately $11.2 million and $1.4 million from backlog, respectively. Gross profit margin was 81.7% compared to 81.0% for the same period in 2015. Net income was $6.1 million compared to $5.1 million for the same period in 2015 and diluted earnings per share was $0.50 compared to $0.42 for the same period in 2015.
Non-GAAP net income was $7.1 million for the nine months ended September 30, 2016 compared to $5.9 million for the same period in 2015. Non-GAAP diluted earnings per share was $0.59 compared to $0.48 for the same period in 2015.
Cash and cash equivalents decreased by $3.4 million to $16.0 million during the nine months ended September 30, 2016. The Company generated $7.2 million of cash from operations and repurchased $10.0 million of its stock during the nine months ended September 30, 2016.
“Third quarter revenue and earnings came in slightly above our revised guidance provided earlier this month and we have increased our full year earnings guidance to reflect these results. Bookings continued along recent trends resulting in approximately $3.4 million of third quarter revenue coming from backlog. Opportunities reported by our sales team and the quoting activity are consistently positive and show increased interest in our pump systems from multiple hospital departments. We remain committed to our sales strategy that now includes calling on hospital critical care departments in addition to radiology and anesthesiology, where we historically focused our sales efforts, believing these additional call points are necessary to drive growth,” said Roger Susi, President and Chief Executive Officer of the Company.
The Company provided revenue and earnings guidance for the fourth quarter and updated its earnings guidance for the full year 2016.
For the fourth quarter, the Company expects revenue of approximately $6.5 to $6.7 million, GAAP diluted earnings per share of $0.03 to $0.04 and non-GAAP diluted earnings per share of $0.04 to $0.06. The Company expects that approximately $1.0 million of the remaining $2.7 million of backlog will be included in fourth quarter revenue.
The Company reiterated its full year revenue guidance of $32.9 million to $33.2 million. The Company adjusted its full year earnings guidance to reflect third quarter results and now expects GAAP diluted earnings per share of $0.54 to $0.55 and non-GAAP diluted earnings per share of $0.63 to $0.65. The Company expects that approximately $13.0 million of 2016 revenue will come from backlog.
Use of non-GAAP Financial Measures
The Company believes the presentation of non-GAAP net income, free cash flow and infrequent tax items can be helpful to our investors. These measures, which we refer to as our non-GAAP financial measures, are not prepared in accordance with GAAP. We calculate non-GAAP net income as net income excluding stock-based compensation expense, net of tax. Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash expenses, we believe that providing non-GAAP financial measures that exclude stock-based compensation expense allow for meaningful comparisons between our operating results from period to period. We calculate free cash flow as net cash provided by operating activities less net cash used in investing activities for purchases of property and equipment. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that can be used for strategic opportunities, including investing in our business, making acquisitions, strengthening our balance sheet and returning cash to our shareholders via share repurchases. Infrequent tax items are considered based on their nature and are excluded from the provision for income taxes as these costs or benefits are not indicative of our normal or future provision for income taxes. All of our non-GAAP financial measures are important tools for financial and operational decision making and for evaluating our operating results.
A reconciliation of the non-GAAP financial measures used in this release to the most comparable U.S. GAAP measures for the respective periods can be found in the table later in this release immediately following the condensed statements of cash flows. These non-GAAP financial measures should not be considered in isolation or as a substitute for a measure of the Company’s operating performance or liquidity prepared in accordance with U.S. GAAP and are not indicative of net income or cash provided by operating activities.
IRADIMED has scheduled a conference call to discuss this announcement beginning at 11:00 a.m. Eastern Time today, October 28, 2016. Individuals interested in listening to the conference call may do so by dialing 1-844-413-1781 for domestic callers, or 1-716-247-5767 for international callers, and entering the reservation code 2986888.
The conference call will also be available real-time via the internet at www.iradimed.com/en-us/investors/index.php and selecting Events & Presentation. A recording of the call will be available on the Company’s website following the completion of the call.
About IRADIMED CORPORATION
IRADIMED CORPORATION is the only known provider of non-magnetic intravenous (IV) infusion pump systems that are specifically designed to be safe for use during magnetic resonance imaging (MRI) procedures. We were the first to develop an infusion delivery system that largely eliminates many of the dangers and problems present during MRI procedures. Standard infusion pumps contain magnetic and electronic components which can create radio frequency (RF) interference and are dangerous to operate in the presence of the powerful magnet that drives an MRI system. Our patented MRidium MRI compatible IV infusion pump system has been designed with a non-magnetic ultrasonic motor, uniquely-designed non-ferrous parts and other special features in order to safely and predictably deliver anesthesia and other IV fluids during various MRI procedures. Our pump solution provides a seamless approach that enables accurate, safe and dependable fluid delivery before, during and after an MRI scan, which is important to critically-ill patients who cannot be removed from their vital medications, and children and infants who must generally be sedated in order to remain immobile during an MRI scan.
MRidium is a trademark of IRADIMED CORPORATION.
For more information please visit www.iradimed.com.