InfuSystem (INHI) Outlines Continued Growth in Conference Call
InfuSystem Holdings, Inc. (INHI), which operates in the same business as medical device makers like Boston Scientific Corporation (BSX) and Edwards Lifesciences Corporation (EW), held its third quarter conference call on Monday where it outlined its quarterly performance and some impressive growth initiatives going forward.
Investors can listen to a conference call replay by clicking here:
http://www.infusystem.com/investors/corporate-information-i/calendar-of-events.html
Company Overview
InfuSystem Holdings, Inc. is a leading provider of ambulatory infusion pumps that are primarily used for the continuous infusion of chemotherapy drugs for patients with colorectal cancer. According to an industry trade group, colorectal cancer is the third most common type of cancer in both men and women, while the standard of care involves the use of infusion pumps.
InfuSystem provides these infusion pumps to physicians and oncologists that use them in their own practices. Given the complexity of maintaining the pumps, high capital expenditure to acquire the pumps, and difficulty billing for the pumps, many of these small practices see the company’s services as invaluable with 90th percentile customer service ratings.
On its conference call, InfuSystem told the story of one client that had left the company to purchase and operate its own infusion pumps. After one year, the client returned to InfuSystem saying that the added complexities of infusion pump operation, maintenance and billing were not worth the additional revenues, and that InfuSystem offered a superior value proposition.
Financial Results
Revenue for the third quarter ended September 30, 2009 was $9.9 million, an 11% improvement compared to $9.0 million for the same period in 2008. However, adjusted EBITDA improved to a record $3.8 million versus $3.6 million for the same period in 2008. Meanwhile, the company’s cash flows from operations continue to look extremely strong.
The company defines Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, and excludes gain (loss) on derivative financial instruments and stock-based compensation, and other non-recurring charges.
Adjusted EBITDA is not a measure of performance calculated in accordance with generally accepted accounting principles in the United States (“GAAP”), but the company believes the presentation of Adjusted EBITDA is a relevant and useful measure to assist a reader’s ability to understand its performance.
Significant Events
InfuSystem reached two major milestones during its third quarter. First, the company continued tweaking its sales force in order to better educate them and align compensation to maximize incentives to perform. Secondly, the company paid down about $800,000 worth of their term loan to I-Flow Corporation with a $22.5 million remaining balance at September 30, 2009.
The term loan to I-Flow originated from the company’s spin-off from the former parent. The covenants on the loan prevent InfuSystem from making any acquisitions or pursuing other strategic opportunities to grow. As this could result in missed opportunities, the company said that it was exploring ways to potentially refinance this debt as quickly as possible.
Looking Ahead…
InfuSystem did not provide any guidance on its conference call, but management did provide some indications of where the company was headed. With regards to the refinancing of its debt, the company noted that it was in talks with numerous parties that have expressed interest, but was quick to caution that it would not try and predict whether a deal would go through.
In addition to the debt refinancing, which is designed to enable growth through acquisitions, InfuSystem has been exploring organic growth opportunities as well.
In the end, InfuSystem posted yet another impressive quarter and continues to offer a compelling value proposition to its customers. Meanwhile, the potential for debt restructuring and new product launches in the near-term serve as very real catalysts for investors. Combined, these factors make this stock one worth following very closely over the coming quarters.
Investors can listen to a conference call replay by clicking here:
http://www.infusystem.com/investors/corporate-information-i/calendar-of-events.html
CONTACT: Daniel Minton, Managing Director, 406-862-5400, daniel@accelerize.com