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Sensus Healthcare Inc (SRTS) Q2 2024 Earnings Call Highlights: Record Revenue Growth and ...

GuruFocus News
·4 min read

  • Revenue: $9.2 million for Q2 2024, up 104% from $4.5 million in Q2 2023.

  • Gross Profit: $5.4 million or 58.7% of revenues for Q2 2024, compared to $2.6 million or 57.9% for Q2 2023.

  • Net Income: $1.6 million or $0.10 per diluted share for Q2 2024, compared to a net loss of $0.4 million or $0.02 per share for Q2 2023.

  • Adjusted EBITDA: $2.1 million for Q2 2024, compared to negative $1 million for Q2 2023.

  • Cash and Cash Equivalents: $19 million as of June 30, 2024.

  • Accounts Receivable: $18.3 million as of June 30, 2024, with approximately $8 million collected.

  • Inventory: $12.8 million as of June 30, 2024.

  • First Half Revenue: $20 million for the first half of 2024, up from $8 million for the first half of 2023.

  • First Half Net Income: $3.9 million or $0.24 per diluted share for the first half of 2024, compared to a net loss of $2.3 million or $0.14 per share for the first half of 2023.

  • First Half Adjusted EBITDA: $5.1 million for the first half of 2024, compared to negative $3.7 million for the first half of 2023.

Release Date: August 08, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Sensus Healthcare Inc (NASDAQ:SRTS) reported a strong year-over-year revenue growth of 104% for the second quarter of 2024, reaching $9.2 million.

  • The company achieved positive net income of $1.6 million, compared to a net loss in the same quarter of the previous year.

  • The Fair Deal Agreement program, launched in March, has gained traction with 15 signed contracts and expectations to reach up to 50 by year-end.

  • International expansion efforts have been successful, with new sales in Asia, including the first-ever image-guided SRT-100 Vision system sold to Far Eastern Memorial Hospital in Taiwan.

  • Gross profit margin improved to 58.7% in the second quarter of 2024, up from 57.9% in the same period of 2023.

Negative Points

  • The company faces supply constraints due to high demand, with most Fair Deal Agreement installations expected in the fourth quarter.

  • General and administrative expenses increased to $1.6 million in Q2 2024, primarily due to higher professional fees and compensation.

  • Research and development expenses rose slightly, reflecting ongoing investment in new product development, such as the TransDermal Infusion (TDI) system.

  • The FDA approval process for the TDI system has been delayed, requiring resubmission with additional features, potentially impacting the timeline for market entry.

  • Cash and cash equivalents decreased to $19 million as of June 30, 2024, from $23.1 million at the end of 2023, indicating a reduction in liquidity.

Q & A Highlights

Q: Can you provide details on the Fair Deal Agreement and its impact on this year's placements? A: Joseph Sardano, CEO, explained that all Fair Deal placements will be installed this year, primarily in the fourth quarter. This will allow for revenue generation from day one in 2025. The program is attractive to customers who prefer to allocate their cash to other areas, such as expanding their practice or acquiring more clinics.

Q: How many Fair Deal Agreements have been signed to date, and what is the expected number by year-end? A: Joseph Sardano, CEO, confirmed that 15 agreements have been signed since the program's introduction in March. Based on current activity levels, they anticipate reaching up to 50 agreements by the end of the year.

Q: Are there any supply constraints due to the high demand for orders this year? A: Joseph Sardano, CEO, stated that they have sufficient supply to meet customer demands and have ordered additional units to be delivered by the end of the third quarter and start of the fourth quarter. They expect to fulfill all customer needs for this year.

Q: How should the Fair Deal Agreements be modeled for future financial projections? A: Joseph Sardano, CEO, suggested that more customers will likely opt for the Fair Deal Agreement due to its user-friendly terms. The agreement allows practices to have autonomy over patient treatment without high risks, making it an attractive option.

Q: Can you provide more information on the domestic and international sales breakdown for SRT systems? A: Joseph Sardano, CEO, reported that out of 23 total sales, 3 were international, leaving 20 domestic. The majority of current revenue is generated from outright equipment sales, with recurring revenue from Fair Deal Agreements expected to become significant in 2025.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.