0001161697-16-001087.txt : 20160923 0001161697-16-001087.hdr.sgml : 20160923 20160923172909 ACCESSION NUMBER: 0001161697-16-001087 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20160923 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20160923 DATE AS OF CHANGE: 20160923 FILER: COMPANY DATA: COMPANY CONFORMED NAME: REPRO MED SYSTEMS INC CENTRAL INDEX KEY: 0000704440 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 133044880 STATE OF INCORPORATION: NY FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-12305 FILM NUMBER: 161900620 BUSINESS ADDRESS: STREET 1: 24 CARPENTER RD CITY: CHESTER STATE: NY ZIP: 10918 BUSINESS PHONE: 845-469-2042 MAIL ADDRESS: STREET 1: 24 CARPENTER RD CITY: CHESTER STATE: NY ZIP: 10918 8-K 1 form_8-k.htm FORM 8-K FOR 09-23-2016

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported)   September 23, 2016

 

REPRO MED SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

 

New York

0-12305

13-3044880

(State or other jurisdiction
of incorporation)

(Commission
File Number)

(IRS Employer
Identification No.)


24 Carpenter Road, Chester, New York

10918

(Address of principal executive offices)

(Zip Code)


Registrant’s telephone number, including area code   (845) 469-2042

 

not applicable

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))




2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.


The Company announced that its net revenues for the second quarter ended August 31 of fiscal 2017 were $3,147,930 compared with $3,166,177 for the second quarter of fiscal 2016. Net loss for the quarter was $82,612 compared with net income of $335,214 for the same period last year. For the six months ended August 31, net loss was $315,928 compared with net income of $270,574. RMS continues to incur professional fees related to regulatory and litigation and has made significant investment over the last twelve months in its sales, regulatory and operations management to help launch RMS to the next level of growth.


ITEM 8.01 OTHER EVENTS.


The Company issued a press release on September 23, 2016 titled “RMS Medical Products Posts Second Quarter 2017 Results”.


ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.


(d) Exhibits.


Exhibit No. Description
   
99.1 Press release dated September 23, 2016


The press release is furnished herewith as Exhibit 99.1.



SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

REPRO MED SYSTEMS, INC.
(Registrant)

 

 

 

Date:  September 23, 2016

By:

/s/ Andrew I. Sealfon

 

Andrew I. Sealfon
President and Chief Executive Officer


- 2 -


EX-99 2 ex_99-1.htm PRESS RELEASE DATED 09-23-2016

Exhibit 99.1


RMS Medical Products Posts Second Quarter 2017 Results


-

Continued growth in core business masked by one-off project in comparable quarter

 

 

-

Successful IgNS 2016 Conference highlighted new product, previewed web redesign

 

 

-

Lean initiatives improving efficiency and manufacturing capacity

 

 

-

Progress made with FDA


CHESTER, NY / September 23, 2016 / Repro Med Systems, Inc. dba RMS Medical Products (OTCQX: REPR) today announced its financial results for the second quarter of the fiscal year ending February 28, 2017.


For the quarter ended August 31st, net revenues were $3,147,930 compared with $3,166,177 in the comparable quarter last year. Our strong organic growth both domestically and internationally in the quarter as well as new customer wins, which we expect will continue to add to our results going forward, were masked by the non-recurring contribution from a large clinical trial last year. Net revenues increased in Q2 compared with Q1 of the current fiscal year by 5%.


For the six months ended August 31st, net revenues were $6,138,096, an increase of 5.9% compared with $5,796,722 for the same period last year, driven by increased sales of our infusion products to existing customers as well as the addition of new customers.


For the three months ended August 31st, our gross profit was $1,954,592 compared with $2,006,729 for the same period last year.  RMS continues benefiting from lean manufacturing initiatives to streamline operations, which have resulted in increased capacity and decreased direct assembly labor costs, as well as the moratorium on the medical device tax.  For the six months ended August 31st, our gross profit margin increased 2.6% to 63.4%, up from 60.8% for the same period last year.  Gross profit for the six months ended August 31st was $3,891,404 compared with $3,524,589 for the comparable period.  


RMS continues to incur professional fees related to regulatory and litigation and has made significant investment over the last twelve months in its sales, regulatory and operations management to help launch RMS to the next level of growth. As a result, the Company reported for the quarter ended August 31st, a net loss of $82,612, compared to net income of $335,214 in the same period last year.  For the six months ended August 31st, net loss was $315,928 compared with net income of $270,574.  


Excluding consulting and professional fees related to regulatory and litigation (summarized in the attached tables), net income for the quarter ended August 31st would have been $117,197 compared with $483,352 for the same period last year.  For the six months ended August 31st net income would have been $292,049 compared with $419,043 last year. Non-GAAP EBITDA for the quarter would have been $251,270 compared to $802,445 for last year and for the six months would have been $586,353 compared with $769,727 for the same period last year.




“Over the past year, the Company has invested in its sales and management teams, which positions us for anticipated growth over the next several quarters.  Furthermore, as part of our sales and marketing initiatives, we recently attended the IgNS 2016 5th National Conference in Miami, Florida and received great feedback from nurse practitioners and healthcare professionals who use our system with their patients,” commented Andy Sealfon, CEO of RMS.  They understand and appreciate our continued efforts to provide the best patient results and our goal to achieve as few site reactions as possible.  RMS strives to ensure that each patient is trained to use the best combination of products within the Freedom system for optimum infusion results.  The attendees at the conference were excited to view the redesigned Freedom60® Syringe Infusion Pump, which not only features a modern design but is also expected to enhance RMS’s brand recognition in the market.  Lastly, we are excited about our redesigned website, which we are thrilled to launch next month.  The new site will provide a comprehensive resource for clinicians and end users searching for information about our systems and best practices, reaffirming our reputation as a patient-first thought leader in the infusion market.


Addressing the FDA Warning Letter, Mr. Sealfon noted: “RMS is engaged in dialogue towards a resolution of the FDA Warning Letter. The Company has established a positive collaboration with the FDA and looks forward to a favorable and swift resolution.  We are encouraged by the results of an ISO audit made in April by international standards leader BSI, which confirmed excellent compliance in RMS’s quality management systems, and required minimal follow-up prior to next year’s audit. RMS devices are both safe and effective for use by patients worldwide, and remain available in all markets.”


The Company manufactures medical products used for infusions and suctioning. The Infusion product portfolio currently includes the FREEDOM60® and our latest FreedomEdge®Syringe Infusion Pumps, RMS Precision Flow Rate Tubing and RMS HIgH-Flo Subcutaneous Safety Needle Sets. These devices are used for infusions administered in professional healthcare settings as well as at home. The Company’s RES-Q-VAC® line of medical suctioning products is used by emergency medical service providers in addition to a variety of other healthcare providers.


The Company’s website may be visited at www.rmsmedicalproducts.com.


This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition to statements which explicitly describe such risks and uncertainties, readers are urged to consider statements labeled with the terms “believes”, “belief”, “expects”, “intends”, “anticipates”, “will”, or “plans” to be uncertain and forward looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in the Company’s reports and registration statements filed with the Securities and Exchange Commission.


This press release includes non-GAAP financial measures that are not in accordance with, nor an alternate to, generally accepted accounting principles and may be different from non-GAAP measures used by other companies.  In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles.  Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.  They are limited in value because they exclude charges that have a material effect on our reported results and, therefore, should not be relied upon as the sole financial measures to evaluate our financial results.  The non-GAAP financial measures are meant to supplement, and to be viewed in conjunction with, GAAP financial results.  A reconciliation of our non-GAAP measures is included in an attachment to this press release.


For more information please call:

Mike King

702 650 3000

Princeton Research

SOURCE: RMS Medical Products




SELECTED FINANCIAL RESULTS


 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

August 31

 

August 31

 

 

 

2016

 

2015

 

2016

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET SALES

 

$

3,147,930

 

$

3,166,177

 

$

6,138,096

 

$

5,796,722

 

Cost of goods sold

 

 

1,193,338

 

 

1,159,448

 

 

2,246,692

 

 

2,272,133

 

Gross Profit

 

 

1,954,592

 

 

2,006,729

 

 

3,891,404

 

 

3,524,589

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

1,932,164

 

 

1,391,143

 

 

4,111,754

 

 

2,869,483

 

Research and development

 

 

67,686

 

 

38,711

 

 

124,355

 

 

92,376

 

Depreciation and amortization

 

 

73,699

 

 

70,094

 

 

143,855

 

 

134,813

 

Total Operating Expenses

 

 

2,073,549

 

 

1,499,948

 

 

4,379,964

 

 

3,096,672

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (Loss)/Operating Profit

 

 

(118,957

)

 

506,781

 

 

(488,560

)

 

427,917

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-Operating (Expense)/Income

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain (Loss) currency exchange

 

 

(5,888

)

 

9,313

 

 

9,744

 

 

(5,757

)

Loss on disposal of fixed assets

 

 

 

 

(8,718

)

 

 

 

(13,324

)

Interest and other income

 

 

385

 

 

1,026

 

 

1,139

 

 

2,129

 

TOTAL OTHER (EXPENSES) INCOME

 

 

(5,503

)

 

1,621

 

 

10,883

 

 

(16,952

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(LOSS)/INCOME BEFORE TAXES

 

 

(124,460

)

 

508,402

 

 

(477,677

)

 

410,965

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax Benefit/(Expense)

 

 

41,848

 

 

(173,188

)

 

161,749

 

 

(140,391

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET (LOSS)/INCOME

 

$

(82,612

)

$

335,214

 

$

(315,928

)

$

270,574

 




Reconciliation of GAAP Net (Loss)/Income

 

Three Months Ended August 31

 

Six Months Ended August 31

 

to Non-GAAP Normalized EBITDA:

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

GAAP Net (Loss)/Income

 

$

(82,612

)

$

335,214

 

$

(315,928

)

$

270,574

 

   Tax (Benefit)/Expense

 

 

(41,848

)

 

173,188

 

 

(161,749

)

 

140,391

 

   Depreciation

 

 

73,699

 

 

70,094

 

 

143,855

 

 

134,813

 

   Professional Fees (1)

 

 

302,031

 

 

223,949

 

 

920,175

 

 

223,949

 

Non-GAAP Normalized EBITDA   

 

$

251,270

 

$

802,445

 

$

586,353

 

$

769,727

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of GAAP Net Loss
to Non-GAAP Normalized Net Income:

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

GAAP Net (Loss)/Income

 

$

(82,612

)

$

335,214

 

$

(315,928

)

$

270,574

 

   Professional Fees (1)

 

 

302,031

 

 

223,949

 

 

920,175

 

 

223,949

 

   Tax Expense on Professional Fees

 

 

(102,222

)

 

(75,811

)

 

(312,198

)

 

(75,480

)

Non-GAAP Normalized Net Income

 

$

117,197

 

$

483,352

 

$

292,049

 

$

419,043

 


(1) Includes consulting and professional fees related to regulatory and litigation