Earnings out
Zynex Announces Third Quarter Results and Settlement
Last update: 11/20/2008 7:30:02 AM
LITTLETON, Colo., Nov 20, 2008 (BUSINESS WIRE) -- Zynex, Inc. (ZYXI), a provider of pain management systems and electrotherapy products for medical patients with functional disability, reports its financial results for the third quarter of 2008 and a complete settlement of a claim of Anthem BlueCross BlueShield ("Anthem").
Results for the third quarter of 2008 and the first nine months of 2008 include the following highlights:
-- Net rental and sales revenue for the three months ended September30, 2008 was $3,502,994. This amount is after two items relating to the Anthem claim -- (1) not recognizing revenues of approximately $1,075,000 from the rental of certain devices to insureds of Anthem during the third quarter of 2008 and (2) the deduction of a provision for settlement in the amount of $1,009,594. (The components of the provision for settlement are explained below.)
-- Net rental and sales revenue for the nine months ended September30, 2008 was $12,291,658. This amount is also after the same two items.
-- Even after these items, net rental and sales revenue for the third quarter of 2008 increased 66% compared to the $2,104,446 for the same quarter of 2007. Net rental and sales revenue for the first nine months of 2008 increased 148% compared to $4,946,384 for the nine months ended September30, 2007.
-- Net income increased to $3,251,040 for the first nine months of 2008 compared to $1,197,694 for the corresponding period in 2007, an increase of 171%.
Thomas Sandgaard, President and CEO of Zynex said: "Sales and rentals to date in the fourth quarter of 2008 continue at a strong pace, and our internal projection for net revenue in the fourth quarter is in excess of $7,000,000. In regard to the settlement, we believe that Zynex continues to have a good relationship with Anthem. Zynex continues to provide products to Anthem insureds and continues to have a network agreement with Anthem."
On November 18, 2008, Zynex completed a settlement of all matters pending with Anthem. In the settlement, Zynex agreed to pay Anthem a partial refund of $679,930 over 12 months and to waive rights to payments of outstanding billings for certain devices provided to Anthem insureds from September1, 2007 through September30, 2008. The provider settlement provision in the consolidated statements of operations is the sum of this $679,930 and the write-off of accounts receivable of $329,664 that existed as of June 30, 2008.
Zynex has a line of credit with Marquette Healthcare Finance. Marquette has consented to the settlement with Anthem. Marquette has also provided a draft waiver of an event of default relating to the Anthem matter, which will not be final until executed, and has indicated that it will work with Zynex to re-set a covenant which would not otherwise be satisfied.
AI
