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Zynex Announces Record Second Quarter 2010 Revenues


Published on 2010-08-17 06:26:30 - Market Wire
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LITTLETON, Colo.--([ BUSINESS WIRE ])--Zynex, Inc. (OTCBB: [ ZYXI ]), a provider of pain management systems and electrotherapy products for medical patients with functional disability, announces a record number of orders and billed patients in the three months ended June 30, 2010. The company generated record net revenues of $5,742,000 for the second quarter ended June 30, 2010. The companya�s second quarter 2010 net revenues represent a 32% increase over second quarter 2009 and 18% sequentially over the first quarter of 2010. Zynexa�s second quarter 2010 gross profit of $4,520,000 is also a record and reflects a 79% gross profit margin. SG&A expenses in the second quarter totaled $4,390,000 up 78% compared to $2,463,000 in the second quarter 2009 and up 14% sequentially compared to $3,847,000 in the first quarter of 2010. The increase in the SG&A for the quarter was primarily due to sales commissions paid on the record level of orders as well as increased staff headcount to support the growing volume of business. Net Income of $30,000, although down from the second quarter 2009, showed improvement versus the first quarter 2010 as the expenditures the company made in recent quarters have helped drive further growth in the top-line. The company experienced near-record cash collections from customers in the quarter. Although cash flow from operations was negative in the quarter, a large portion of that was due to cash outlays for prior year federal tax payments as well as a build-up in inventory to stock the larger sales force with equipment. Results for the first six months of 2010 included net revenues of $10,617,000 and net loss of $37,000.

Zynex is providing guidance for third quarter 2010 net revenues of between $6.2 million and $6.8 million.

Thomas Sandgaard, CEO, said: "I am proud to announce our 2010 second quarter financial results and provide preliminary guidance for third quarter 2010. In the second quarter of 2010 we once again demonstrated very strong net revenue growth both comparably and sequentially over prior periods. Our cash collections were very strong and we began to see the benefit from the recent growth in our sales team. We expect our increased investment in infrastructure and sales force will continue to enable Zynex to generate substantial growth in the second half of fiscal 2010.a

Highlights from the second quarter 2010 consolidated financial statements (unaudited):
($ in thousands, except per share amounts)

Second Quarter Ended June 30,

3 Months

6 Months

2010 2009 2010 2009
Net Revenues $5,742 $4,347

$10,617

$8,579

Gross Profit $4,520 $3,570 $8,399 $7,320
Net Income/(Loss) $30 $709 ($37) $1,659
Net Income per share - Diluted * $0.02 ** $0.05

Common Shares Used in Computing per Share Amount a" Diluted

30,702,944 30,340,987 30,716,349 30,390,143
Total Stockholdersa� Equity $7,623 $6,158 -- --

* Less than $0.01 per share.
** Less than ($0.01) per share.

About Zynex

Zynex, Inc. (founded in 1996) engineers, manufactures, markets and sells its own design of electrotherapy medical devices in two distinct markets: standard digital electrotherapy products for pain relief and pain management; and the NeuroMove(TM) for stroke and spinal cord injury (SCI) rehabilitation. Zynex's product lines are fully developed, FDA-cleared, commercially sold, an have been developed to uphold the Company's [ mission ] of improving the quality of life for patients suffering from impaired mobility due to stroke, spinal cord injury, or debilitating and chronic pain. Zynex has also announced the development of two now business units, Zynex Monitoring Solutions and Zynex NeuroDiagnostic.

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 10-K Report for the year ended December 31, 2009.

Contributing Sources