Investor Presentation & Financial Highlights. May 2018

Transcription

1 Investor Presentation & Financial Highlights May 2018

2 Forward Looking Statements Certain statements in this release are "forward-looking" and as such are subject to numerous risks and uncertainties. Actual results may vary significantly from the results expressed or implied in such statements. Factors that could cause actual results to materially differ from forwardlooking statements include, but are not limited to, the need to obtain FDA clearance and CE marking of new products, the acceptance of new products as well as existing products by doctors and hospitals, larger competitors with greater financial resources, the need to keep pace with technological changes, our dependence on the reimbursement from insurance companies for products sold or rented to our customers, acceptance of our products by health insurance providers, our dependence on third party manufacturers to produce our goods on time and to our specifications, implementation of our sales strategy including a strong direct sales force our ability to up-list to a larger exchange and other risks described in our filings with the Securities and Exchange Commission including the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2017 as well as Forms 10-Q, 8-K and 8-K/A, press releases and the Company's website. 2

3 Zynex Medical Overview Background OTCQB:ZYXI (14 years) Founded By Thomas Sandgaard Current CEO and Chairman Medical Device Manufacturer 22 Years HQ Englewood, Colorado More than 400,000 patients treated Business Units ZYNEX MEDICAL (ZMI) Non-invasive electrotherapy pain management devices TENS (90% of historical revenue) Rx required, insurance billed >75% GPM, >60% recurring revenue (consumable supplies and rentals) ZYNEX NEURODIAGNOSTICS (ZND) EEG, EMG diagnostics B:B products (<2% of historical revenue) NeuroMove Stroke Rehab product ZYNEX MONITORING SOLUTIONS (ZMS) Fully developed, non-invasive blood volume monitor (Zero revenue) 3

4 Zynex Financial Snapshot Q vs Q Net revenue 100% to $6.9M from $3.4M Device revenue 15% to $1.6M from $1.4M Supplies revenue 158% to $5.3M from $2.1M (recurring) GM s 82% vs 73% Net income 444% to $1.9M from $0.4M A-EBITDA 257% to $2.0M from $0.6M Cash from operations 4,288% to $1.0M from $23K Orders 36% Balance Sheet Working capital $4.6M vs $4.4M at 12/31/17 Cash $4.4M No long-term debt 4

5 Electrotherapy Eliminates or Reduces Opioid Use % of Patients Who Reduced Medication Usage: Nearly Half reduced Medication usage by More Than: Patients also Decreased the cost of medication by: 84% 50% 50% * Long-Term Transcutaneous Electrical Nerve Stimulation (TENS) Use: Impact on Medication Utilization and Physical Therapy Costs Chabal et al The Clinical Journal of Pain, Vol 14, No 1, March 1998: pp 66-73

6 Pain & Rehabilitation NexWave Augments healing, alleviates swelling through increased blood circulation, and reduces both acute/chronic pain through the use of electrical currents InWave Delivers a nonsurgical, drug-free therapy that offers a conservative treatment to manage incontinence and is of relatively low cost to patients. NeuroMove Augment healing, as well as assist in recovery for stroke, Spinal Cord Injuries and Traumatic Brain Injury, retrains muscles, increases range of motion Electrotherapy Incontinence Treatment Stroke Rehab $500 million industry worldwide $5Billion industry worldwide $100 million industry worldwide Zynex Medical Electrotherapy Pain Management Opioid epidemic favor using Zynex s NexWave as 1 st Line-Of-Defense. Rapid Growth through expanding sales force. EMPI announced exit from TENS market in Late 2015/Early

7 Blood Volume Monitor CM-1500 Used in operating and recovery rooms to detect blood loss and internal bleeding $3 Billion industry worldwide. No competition. Zynex Monitoring Solutions - CM1500 FDA 510(k) application filed for clearance of CM1500 monitoring device. CE marking (European Market) in progress. The CM1500 is capable of monitoring a patient's fluid levels, including blood loss, during surgery and in recovery. Product fully developed. 7

8 Long-Term Objectives Up-listing to a senior exchange NYSE MKT or NASDAQ Grow recurring revenue streams Generate consistent net earnings and positive free cash flow Reinvest to develop devices and applications with high GPM Focus on driving value thru organic growth and strategic acquisitions 8

9 Executive Team Thomas Sandgaard has been the Chairman of the Board, President and Chief Executive Officer of Zynex, Inc. since founding the company in He has previously held management positions with companies such as ITT, Siemens, GN Danavox, Dataco and Philips. Most of his work has been in the areas of international sales and distribution, technology transfers, mergers and marketing management in the semiconductor, telecommunications, data communications and medical equipment industries. Mr. Sandgaard has a bachelor s degree in electronics engineering from University of Southern Denmark and an MBA from Copenhagen Business School. Mr. Sandgaard has an in-depth knowledge of the industry and is the driving force as to the Company strategies. Dan Moorhead joined the company in June 2017 as CFO. Mr. Moorhead has over 20 years of experience in a variety of finance roles serving both public and private companies. For the last 10 years, he worked at Evolving Systems, Inc. (a Nasdaq listed company), most recently as Chief Financial Officer after having served as Vice President of Finance & Administration and Corporate Controller. Mr. Moorhead is a CPA and holds a B.B.A. in Accounting from the University of Northern Colorado. Robert Bird is VP of Marketing responsible for all marketing, in-side sales and compounding products within the rehabilitation and pain management markets for the Zynex Medical division of Zynex. Mr. Bird has over 20 years of sales and management experience and holds a B.S. Degree in Business Administration from California State University, Hayward. Michael Frabotta is VP of sales and is responsible for Zynex Medical s sales organization promoting electrotherapy and compound pharmacy products throughout the United States. Mr. Frabotta has over 14 years of successful sales and management experience with RS Medical and ERMI, Inc. At RS Medical a once national competitor in the electrotherapy arena he successfully served as a Director of Sales, National Director of Payor Contracting, Regional Manager, and Sales Representative. Mr. Frabotta received a Bachelor of Science in Nursing from the University of Pittsburgh where he specialized in Orthopaedics. 9

10 Company Milestones Founded by Thomas Sandgaard FDA clearance on first Zynex E-Stim device Shifted from wholesale to direct sales to physicians and patients Reverse merger into a public entity Received European CE mark on key products Established NeuroDiagnostics (EEG/Sleep) and Monitoring (blood volume) subsidiaries Commenced clinical evaluations for Blood Volume Monitor device TENS business begins to grow. EMPI (largest competitor) exits TENS market Filed FDA 510K application for CM1500 monitoring device 10

11 Shareholders 54%: Thomas Sandgaard, Founder, Chairman and CEO. 46%: 1,500 individual shareholders, primarily retail. 11

12 Q1-18 revenue 100% vs Q1-17 Q1-18 supplies revenue 158% vs Q

13 Q1-18 net income 444% vs Q th straight profitable quarter 13

14 Balance Sheet March 31, December 31, (In Thousands) ASSETS Cash $ 4,366 $ 5,565 Total current assets 8,359 8,371 Total assets $ 9,309 $ 8,929 LIABILITIES AND STOCKHOLDERS' EQUITY Total current liabilities $ 3,753 $ 4,015 Total liabilities 4,094 4,027 Total stockholders' deficit 5,215 4,902 Total liabilities and stockholders' equity $ 9,309 $ 8,929 Working Capital $ 4,606 $ 4,356 Working capital $4.6M No debt $1.8M cash used in stock buyback in Q

15 Zynex Announces 2017 Fourth Quarter and Full Year Earnings Revenue grew 100% year over year to $6.9 million Net income of $1.9 million increased 444% year over year; Diluted EPS $0.06 Adjusted EBITDA of $2.0 million increased 257% year over year Seventh consecutive quarter of positive net income, 82% gross margin and 28% operating margin President and CEO Commentary: Thomas Sandgaard, CEO said: I am pleased to report revenue of $6.9 million in the first quarter with net income of $1.9 million or $0.06 per share. Adjusted EBITDA was $2.0 million and the quarterly revenue was twice the revenue of the first quarter of Revenue was less than the $8.1 million recorded in the fourth quarter of 2017 due to insurance company deductibles not being met early in the year, a seasonal trend we see every year in this industry. The investment in growing our sales force has led to device order growth of 36% compared to the first quarter of 2017 and 8% growth compared to the fourth quarter of We currently estimate our second quarter revenue to range between $7.5 million and $8.0 million with Adjusted EBITDA between $2.5 million and $3.0 million. The revenue estimate is approximately 49% to 59% above last year s second quarter and the Adjusted EBITDA estimate is 24% to 48% above last year. First Quarter Financial Results Summary: The Company reported net revenue of $6.9 million, a 100% increase over Q First quarter revenue is historically our lowest of the year as it is affected by health insurance deductibles which have not been met. Gross margins were 82% in the first quarter of 2018 compared to 73% last year. Net income grew 444% to $1.9 million in the first quarter of 2018, compared to $0.4 million last year. Adjusted EBITDA grew 257% to $2.0 million in the first quarter of 2018 compared to $0.6 million last year. The Company generated $1.0 million of cash from operations during the first quarter of 2018, an increase of 4,288% compared to $23,000 in As of March 31, 2018, the Company had working capital of $4.6 million compared to $4.4 million at December 31,

16 Stock Information Key Stats Ticker Shares Outstanding Public Float OTCQB: ZYXI 32.6 M 14.9 M Avg. Daily Volume (30 days) 18, Week Range $ $5.50 Year End December 31 st 16

17 Stock Chart Zynex, Inc. - Stock Price $6.00 $5.50 $5.00 $4.50 $4.00 $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr ,000 Zynex, Inc. - Volume 300, , ,000 - May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 17

18 Contact Information Amato and Partners, LLC Investor Relations Counsel 90 Park Avenue, 17 th Floor New York, NY Zynex, Inc Maroon Circle Englewood, CO Telephone: (800) Zynex, Inc. Dan Moorhead Chief Financial Officer Telephone: (800) Ext