Vaso Corporation Announces Third Quarter 2017 Financial Results
PLAINVIEW, NY / ACCESSWIRE / November 14, 2017 / Vaso Corporation (OTC PINK: VASO) (formerly Vasomedical, Inc.) today reported its operating results for the three months ended September 30, 2017.
"We are pleased to report that the Company achieved continued revenue growth to $18.0 million for the third quarter of 2017, thanks to the double-digit year-over-year growth rate in our IT segment, a majority of which was in the healthcare IT VAR business we started three years ago. We experienced a revenue decline in the professional sales service segment due to lower equipment delivery volume by our partner, but deferred revenue in the segment increased significantly as our team of sales professionals continue to perform," commented Dr. Jun Ma, President and Chief Executive Officer of Vaso. "Therefore, we anticipate an improvement in the fourth quarter and the next year."
"Maintaining overall revenue growth despite fluctuations in a particular area of our business or in a particular geographic region shows the importance of a diversified business mix, which places the Company in a strong and robust footing to ensure stability and future development. We also are continuing the path of working to align our business structure with technologies of higher growth," concluded Dr. Ma.
Three Months Ended September 30, 2017 Financial Results
For the three months ended September 30, 2017, revenue increased 3% to $18.0 million from $17.5 million for the same period of 2016. The increase, when compared to the same period in 2016, was a result of a $1.1 million, or 12%, growth in our IT segment revenue, offset by a decrease of $0.3 million, or 4%, of revenue in our professional sales services segment, lower equipment deliveries by GEHC compared to the third quarter 2016. The increase in our IT segment revenue is attributable to increases in revenue in both our NetWolves and our healthcare IT operations. Revenue in the equipment segment decreased $0.4 million for the quarter when compared to the same quarter a year ago, due to a decrease in EECP® deliveries.
Gross profit for the third quarter of 2017 decreased 1% to $10.0 million, compared with $10.2 million for the third quarter of 2016. The decrease was principally due to the decrease in revenue in the professional sales service segment and the decrease in equipment segment revenue, offset by a 9% increase in gross profit in the IT segment as a result of the increased revenue in that segment. Total gross profit margin was 56% of revenue for the three months ended September 30, 2017, and 58% for the same period in 2016.
Selling, general and administrative (SG&A) expenses for the third quarter of 2017 increased to $10.4 million from $9.5 million for the third quarter last year. The increase is primarily due to an increase in personnel and marketing costs in the professional sales service segment, and an increase in staff in the IT segment.
The Company had an operating loss of $619 thousand for the third quarter 2017, compared to operating income of $502 thousand for the same period in 2016. The decrease was principally due to the lower revenue in the professional sales service segment and the increase in SG&A costs as discussed above. Net loss for the three months ended September 30, 2017 was $816 thousand, compared with net income of $328 thousand for the three months ended September 30, 2016.
Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization and non-cash stock-based compensation) was $152 thousand for the three months ended September 30, 2017, compared to $1.4 million for the same period a year ago.
Net cash generated from operating activities in the first nine months of 2017 was $865 thousand. As of September 30, 2017, the Company had cash and cash equivalents of approximately $5.5 million, compared to cash and cash equivalents of $7.1 million at December 31, 2016. We anticipate continued positive cash flow from operations for the remainder of the year.
About Vaso Corporation
Vaso Corporation is a diversified medical technology company with three distinctive but related specialties: professional sales services for diagnostic imaging products; managed IT systems and services, including healthcare software solutions and network connectivity services; and the design, manufacture, and sale of proprietary medical devices.
The Company operates through three wholly owned subsidiaries. Vaso Diagnostics, Inc. d.b.a. VasoHealthcare (www.vasohealthcare.com), provides professional sales services and is the operating subsidiary for the exclusive sales representation of GE Healthcare diagnostic imaging products in certain market segments in the USA. Vaso Technology, Inc. provides network and IT services through two business units: VasoHealthcare IT Corp., a national value added reseller of healthcare software solutions and related services, including implementation, management and support, and NetWolves Network Services LLC (www.netwolves.com), a managed network services provider with an extensive, proprietary service platform to a broad base of customers. Vasomedical, Inc. (www.vasomedical.com), manages and coordinates the design, manufacture, sales and services of proprietary medical devices including EECP® Therapy Systems, Biox® series ambulatory monitoring systems and ARCS® series analysis and reporting software. The Company also owns overseas operations including China-based Biox Instruments Co. Ltd. and Life Enhancement Technology Limited and is the minority shareholder of VSK Medical Limited, a marketing and sales company for ECP products in the international market. Additional information is available on the Company's website at www.vasocorporation.com.
