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 2011 unaudited financial results.
The Company's net revenue increased 42% to $34,148,000 for 2011 from $24,085,000 for 2010. The Company's 2011 revenue was driven by its Zynex Medical subsidiary, in which the Company continued to see strong demand for its electrotherapy products. The Company generated 2011 net income of $1,564,000, or $.05 per share, versus 2010 net income of $350,000 or $.01 per share, representing a five-fold increase year over year.
The Company reported a gross profit of $26,777,000, or 78% of net revenue, for 2011, as compared to a gross profit of $18,883,000, or 78% of net revenue, for 2010.
The Company reported Selling, General and Administrative (SG&A) expenses of $23,676,000, or 69% of net revenue, for 2011, as compared to $17,322,000, or 72% of net revenue, for 2010. Increases in the Company's SG&A expenses during 2011 were primarily attributable to sales and marketing (related to sales commissions based on the 42% increase in net revenue and investments made to expand the Company's sales force), billing and reimbursement (related to personnel additions to handle the increased demand in orders and further improve the reimbursement and collections process) and engineering and operations (related to business development for our Zynex NeuroDiagnostics Inc. subsidiary and product development for our Zynex Monitoring Solutions, Inc. subsidiary).
The Company generated 2011 income from operations of $3,101,000, income before income taxes of $2,644,000 and net income of $1,564,000, versus 2010 income from operations of $1,561,000, income before income taxes of $1,335,000 and net income of $350,000. The Company's net revenue was at the top of its outlook for 2011, but net income per diluted share was below the Company's 2011 outlook, primarily because of slightly lower gross margins and higher than originally anticipated interest expense.
Thomas Sandgaard, CEO stated: "The continued growth in our top line revenue of 42% is directly related to an increase in orders received for electrotherapy devices and recurring consumable supplies, and is being driven by the build out of our sales force across key markets over the past year. We believe the investments made in our sales team will continue to benefit the company in the year ahead, as we now have over 200 field sales representatives across 38 states. We continue to see growth opportunities in geographic markets that we have not penetrated and look to fill these voids during 2012. Our continued investment in the billing and reimbursement department is necessary, and is an integral part of the success of our organization, as it is responsible for negotiating with third-party payors and collecting cash on each order processed."
Mr. Sandgaard continued: "We also increased our efforts in our Zynex Monitoring Solutions and Zynex NeuroDiagnostics subsidiaries during 2011. Our Zynex Monitoring Solutions subsidiary is developing a non-invasive blood volume monitor that would be used for monitoring central blood volume to detect blood loss during surgery and internal bleeding during recovery. This unique medical device application is intended to serve what we believe is a currently unmet need in the market for safer surgeries and safer monitoring of patients during recovery. We believe the potential end market for a non-invasive blood volume monitoring device could represent a significant opportunity if successful. We are very pleased with the results from our first clinical evaluation and are in the planning stage for additional evaluations during 2012. On March 9, 2012, we completed our asset acquisition of NeuroDyne Medical Corp., through our Zynex NeuroDiagnostics subsidiary. NeuroDyne is an 18 year old manufacturer of advanced medical devices for non-invasive measurement of surface electromyography (sEMG) and autonomic nervous systems. The acquisition of NeuroDyne diversifies our product line and provides a more rapid entrance into the neurodiagnostic biofeedback market space. We are working closely with NeuroDyne's CEO, who was appointed VP of Technical Operations for Zynex NeuroDiagnostics, to fully integrate the business into our Zynex NeuroDiagnostics subsidiary, and will begin selling NeuroDyne products in our already existing sales channels."
Outlook:
The Company anticipates net revenues of between $38 million and $40 million for 2012 and net income per diluted share of between $0.06 and $0.08 for 2012.
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