KORU Medical Systems Inc (KRMD, Financial) disclosed its financial results for the first quarter ended March 31, 2024, revealing significant revenue growth and operational advancements. The company, a leader in subcutaneous infusion solutions, announced these details in its 8-K filing on May 1, 2024. Despite surpassing revenue expectations, the company faced a net loss, aligning closely with analyst projections.
Company Overview
KORU Medical Systems Inc specializes in the development and manufacture of medical devices, particularly focusing on its FREEDOM Infusion Systems used for delivering immunoglobulin therapies for chronic conditions such as Primary Immunodeficiencies and Chronic Inflammatory Demyelinating Polyneuropathy. The company's offerings include the FREEDOM60 and FreedomEdge Syringe Drivers, which are pivotal in managing patient treatments in home settings.
Financial Performance Highlights
For Q1 2024, KORU Medical reported a revenue of $8.2 million, marking an 11% increase year-over-year and setting a new record for quarterly revenue. This growth was primarily driven by a 14% increase in its core business across both U.S. and international markets, attributed to market share gains and geographic expansion. Notably, the company's gross profit saw a 23% increase to $5.1 million, with gross margin improving significantly by 620 basis points to 62%.
Despite these gains, the company recorded a net loss of $1.9 million, or $0.04 per diluted share, which is an improvement from the previous year's net loss of $2.4 million, or $0.05 per diluted share. The adjusted EBITDA was reported at -$0.9 million. The operational expenses slightly decreased by 1.9% to $7.1 million, reflecting enhanced operational efficiency.
Strategic Developments and Future Outlook
President and CEO Linda Tharby highlighted the company's strategic advancements, including the expansion into novel therapies and the addition of three new collaborations in the year, enhancing KORU Medical's drug pipeline. The company reaffirmed its full-year revenue guidance for 2024, projecting an increase of 10% to 13%, with anticipated revenues between $31.2 million and $32.2 million. Gross margins are expected to remain strong, ranging from 59% to 61%.
Furthermore, the company is optimistic about achieving cash flow breakeven by the fourth quarter of 2024 and turning cash flow positive in 2025. This financial trajectory is supported by a robust ending cash balance of $10.8 million as of March 31, 2024, despite a quarterly cash usage of $0.7 million.
Analysis and Investor Outlook
While KORU Medical's revenue growth is commendable, the persistent net losses highlight ongoing challenges. However, the company's strategic initiatives, particularly in expanding its product offerings and geographic reach, are expected to bolster long-term growth. Investors and stakeholders are likely to watch closely how these strategies unfold in aligning with the company's financial health and market position in the competitive medical devices landscape.
For detailed insights and further information, investors are encouraged to review the full earnings report and stay tuned for the upcoming conference call scheduled for May 1, 2024, at 4:30 PM ET.
Explore the complete 8-K earnings release (here) from KORU Medical Systems Inc for further details.
