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RMS Medical Products Announces Record Quarterly Sales and Net Income

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RMS Medical Products Announces Record Quarterly Sales and Net Income

- Net Sales for the quarter ended June 30, 2018 increased 17.6% over the same period last year

- Net Income increased to $475,723 or 10.6% of Net Sales

- Inaugural conference call August 7th at 9:00 AM ET

PR Newswire

CHESTER, N.Y., Aug. 6, 2018 /PRNewswire/ -- Repro Med Systems, Inc. dba RMS Medical Products (OTCQX:REPR) today announced financial results for the second quarter ended June 30, 2018.

RMS Medical Logo (PRNewsfoto/RMS Medical Products)

Net sales grew for the fifth consecutive quarter to $4.5 million, a 17.6% increase over the second quarter of 2017. The increase in net sales was driven by higher needle set sales, which we believe were bolstered by the FDA clearance on August 31, 2017, for the RMS "Integrated Catch-Up Freedom Syringe Driver Infusion System". Net sales during the period included approximately $0.3 million of revenue related to one-time sales to support the clinical activities of various pharmaceutical companies.

Gross profit grew to $2.7 million, a 19.3% increase over the second quarter of 2017 and a gross margin improvement of 80 basis points. The increase in gross profit and margin is principally the result of higher net sales.

Net income for the period increased to a record $475,723, or 10.6% of net sales, which compares with $148,472 reported during the second quarter of 2017.  Higher net sales combined with improved gross profit on relatively flat operating expenses and a favorable tax rate change were principally responsible for the increase in profitability.   

"Second quarter results were strong as RMS continues to grow market share within its core indications, as well as pursue new opportunities," stated Dan Goldberger, Chairman and interim President and CEO. "As we undergo the next phase of RMS's development, I want to assure all of our stakeholders that we will continue to pursue our mission to improve the quality of life of patients around the world through the design, development, and delivery of the highest quality innovative therapeutic solutions. Patient safety, product efficacy, respect for all of our stakeholders, customer service, and building shareholder value continue to be our highest priorities."

On July 26, 2018, the Company announced that RMS Medical Products' Board of Directors appointed Daniel Goldberger, Board Member, to the position of Chairman and interim President and Chief Executive Officer, replacing Andy Sealfon who will remain on the Board of Directors. Please reference the Company's recent press release and filings for background information.

Conference Call

The Company will host a conference call to discuss the second quarter 2018 financial results and business developments on Tuesday, August 7, 2018, at 9:00 AM ET. Please refer to the information below for conference call dial-in information and webcast registration:

Conference date: August 7, 2018, 9:00 AM ET
Conference dial-in: 877-269-7756
International dial-in: 201-689-7817
Conference Call Name: RMS Medical Products (OTCQX:REPR) Second Quarter 2018 Results Call
Webcast Registration: Click Here

Following the live call, a replay will be available on the Company's website, www.rmsmedicalproducts.com, under "Investor Relations" for a period of one year.

About RMS Medical Products

The Company develops, manufactures and commercializes medical products used for home infusions and suctioning. The FREEDOM Syringe Infusion System currently includes the FREEDOM60® and FreedomEdge® Syringe Infusion Drivers, RMS Precision Flow Rate Tubing™ and RMS HIgH-Flo Subcutaneous Safety Needle Sets™. These devices are used for infusions administered in professional healthcare settings as well as at home. The Company's RES-Q-VAC® line of medical suctioning products is used by emergency medical service providers in addition to a variety of other healthcare providers. For more information about RMS Medical Products, please visit www.rmsmedicalproducts.com.

Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition to statements which explicitly describe such risks and uncertainties, readers are urged to consider statements labeled with the term "believe" to be uncertain and forward-looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in the Company's reports and registration statements filed with the Securities and Exchange Commission.  The results of operations for the periods presented herein are not necessarily indicative of the results to be expected in the future.

 

REPRO MED SYSTEMS, INC.

BALANCE SHEETS




June 30,


December 31,




2018


2017




(Unaudited)




ASSETS
















CURRENT ASSETS








Cash and cash equivalents


$

3,421,186


$

3,974,536


Certificate of deposit (restricted cash)



1,504,818




Certificates of deposit



159,462



263,269


Accounts receivable less allowance for doubtful accounts of 
     $77,067 at June 30, 2018 and $77,067 at December 31, 2017



1,840,094



1,861,949


Inventory  



1,718,294



1,658,681


Prepaid expenses



255,888



170,739


TOTAL CURRENT ASSETS



8,899,742



7,929,174


Property and equipment, net



795,484



836,283


Patents, net of accumulated amortization of $220,340 and $203,768 at June 30, 2018 and December 31, 2017, respectively



531,685



483,821


Other assets



31,582



31,582


TOTAL ASSETS


$

10,258,493


$

9,280,860










LIABILITIES AND STOCKHOLDERS' EQUITY
















CURRENT LIABILITIES








Deferred capital gain - current


$

15,003


$

22,481


Accounts payable



711,947



454,398


Accrued expenses



539,473



658,060


Accrued payroll and related taxes



187,307



334,903


Accrued tax liability



91,488



115,854


TOTAL CURRENT LIABILITIES



1,545,218



1,585,696


Deferred capital gain – long term





3,762


Deferred tax liability



20,733



21,675


TOTAL LIABILITIES



1,565,951



1,611,133










STOCKHOLDERS' EQUITY








Common stock, $0.01 par value; 75,000,000 shares authorized, 40,907,991 and 40,731,529 shares issued, 38,170,760 and 37,994,298 shares outstanding at June 30, 2018 and December 31, 2017, respectively



409,080



407,315


Additional paid-in capital



4,358,618



4,216,718


Retained earnings



4,269,048



3,389,898





9,036,746



8,013,931


Less: Treasury stock, 2,737,231 shares at June 30, 2018 and December 
     31, 2017



(344,204)



(344,204)


TOTAL STOCKHOLDERS' EQUITY



8,692,542



7,669,727


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY


$

10,258,493


$

9,280,860


 

REPRO MED SYSTEMS, INC.

STATEMENTS OF OPERATIONS (UNAUDITED)




For the

Three Months Ended


For the

Six months Ended




June 30,


June 30,




2018


2017


2018


2017
















NET SALES


$

4,502,326


$

3,829,457


$

8,535,550


$

7,467,893


Cost of goods sold



1,762,742



1,532,158



3,330,142



3,068,639


Gross Profit



2,739,584



2,297,299



5,205,408



4,399,254
















OPERATING EXPENSES














Selling, general and administrative



2,022,631



2,005,336



3,902,900



3,780,445


Research and development



23,963



24,840



33,811



70,746


Depreciation and amortization



75,978



76,781



150,556



151,662


Total Operating Expenses



2,122,572



2,106,957



4,087,267



4,002,853
















Net Operating Profit



617,012



190,342



1,118,141



396,401
















Non-Operating (Expense)/Income














 (Loss)/Gain on currency exchange



(19,838)



34,670



(10,414)



51,744


Interest and other income



5,501



421



6,116



2,066


TOTAL OTHER (EXPENSE)/INCOME



(14,337)



35,091



(4,298)



53,810
















PROFIT BEFORE TAXES



602,675



225,433



1,113,843



450,211
















Income Tax Expense



(126,952)



(76,961)



(234,693)



(174,788)
















NET INCOME


$

475,723


$

148,472


$

879,150


$

275,423
















NET INCOME PER SHARE




























Basic


$

0.01


$


$

0.02


$

0.01


Diluted


$

0.01


$


$

0.02


$

0.01
















WEIGHTED AVERAGE NUMBER
OF COMMON SHARES
OUTSTANDING




























Basic



38,100,040



37,825,209



38,058,500



37,799,981


Diluted



38,872,998



37,899,619



38,815,301



37,866,730


 

REPRO MED SYSTEMS, INC.

STATEMENTS OF CASH FLOWS

(UNAUDITED)




For the Six Months Ended




June 30,




2018


2017










CASH FLOWS FROM OPERATING ACTIVITIES








Net Income


$

879,150


$

275,423


Adjustments to reconcile net income to net cash provided by/(used in) 
  operating activities:








Amortization of deferred compensation cost





7,000


Stock based compensation expense



94,170



41,479


Depreciation and amortization



150,556



151,662


Deferred capital gain - building lease



(11,240)



(11,240)


Deferred taxes



(941)



12,937


Provision for returns and doubtful accounts





(5,603)


Changes in operating assets and liabilities:








Decrease/(Increase) in accounts receivable



21,855



(597,699)


(Increase)/Decrease in inventory



(59,613)



94,177


(Increase)/Decrease in prepaid expense and other assets



(85,149)



33,174


Increase/(Decrease) in accounts payable



257,549



(492,919)


(Decrease)/Increase in accrued payroll and related taxes



(147,597)



71,113


Decrease in accrued expense



(118,587)



(12,207)


(Decrease)/Increase in accrued tax liability



(24,366)



161,851


NET CASH PROVIDED BY/(USED IN) OPERATING ACTIVITIES



955,787



(270,852)










CASH FLOWS FROM INVESTING ACTIVITIES








Payments for capital expenditures



(93,185)



(89,437)


Purchase of certificate of deposit (restricted cash)



(1,500,000)




Reinvested earnings on certificate of deposit (restricted cash)



(4,818)




Payments for patents



(64,436)



(53,346)


Proceeds/(reinvested earnings) from certificates of deposit



103,807



(1,196)


NET CASH USED IN INVESTING ACTIVITIES



(1,558,632)



(143,979)










CASH FLOWS FROM FINANCING ACTIVITIES








Stock issuances



51,250




Payment for cancelled shares



(1,755)



(19,360)


Purchase of treasury stock





(484)


NET CASH PROVIDED BY/(USED) IN FINANCING ACTIVITIES



49,495



(19,844)










NET DECREASE IN CASH AND CASH EQUIVALENTS



(553,350)



(434,675)


CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD



3,974,536



3,417,183


CASH AND CASH EQUIVALENTS, END OF PERIOD


$

3,421,186


$

2,982,508










Supplemental Information








Cash paid during the periods for:








Interest


$


$


Taxes


$

260,000


$










NON-CASH FINANCING AND INVESTING ACTIVITIES








Issuance of common stock as compensation


$

67,500


$

67,500


 

Contact
CG Capital
877.889.1972
investorrelations@cg.capital

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SOURCE RMS Medical Products

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