Electromed (ELMD) Tops Q2 EPS by 10c, Revenues Beat

Electromed (NYSE: ELMD) reported Q2 EPS of $0.14, $0.10 better than the analyst estimate of $0.04. Revenue for the quarter came in at $8.55 million versus the consensus estimate of $8.41 million.

Q2 FY 2020 Highlights

• Net revenue increased 6.7% to $8.5 million from $8.0 million for the three months ended December 31, 2018 (“Q2 FY 2019”).
• Operating margin improved to 18.3% from 8.4% in Q2 FY 2019.
• Operating income grew 132.1% to $1.6 million from $0.7 million in Q2 FY 2019.
• Net income rose 211.4% to $1.2 million, or $0.14 per diluted share, from $0.4 million, or $0.04 per diluted share, in Q2 FY 2019.
• Cash flow from operating activities increased to $1.4 million from $0.5 million in Q2 FY 2019.

Kathleen Skarvan, President and Chief Executive Officer of Electromed, commented, “We delivered another strong bottom-line performance in the second quarter, with net income of approximately $1.2 million, driven by year-over-year revenue growth of 6.7% and significant operating margin improvement to 18.3%. This quarter we produced $938,000 of annualized homecare revenue per direct field sales employee, exceeding our target productivity range of between $750,000 and $850,000. Our institutional business continued to perform well, with second quarter revenue up 22.8% year-over-year. Overall, we are very pleased with the execution of our organic growth strategy in the first half of fiscal 2020.”

Ms. Skarvan continued, “For the remainder of the fiscal year, we plan to increase investment on clinical studies, new product development and sales staff expansion to reach our previously disclosed target of 38 direct field sales employees. We believe these investments will help us achieve low double-digit revenue growth and operating margin improvement over the long term. An increasing number of physicians and patients are embracing the benefits of high frequency chest wall oscillation therapy with our SmartVest® Airway Clearance device, particularly in the large, underpenetrated bronchiectasis market, underpinning our enthusiasm for growth.”

For earnings history and earnings-related data on Electromed (ELMD) click here.

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