Fuse Medical, Inc. Announces Second Quarter 2021 Financial Results
RICHARDSON, Texas--(BUSINESS WIRE)--Fuse Medical, Inc. (OTCPINK: FZMD) (“Fuse” or the “Company”) an emerging manufacturer and distributor of innovative medical devices for the orthopedic and spine marketplace, announced that it has filed its quarterly report on Form 10-Q for the quarter ended June 30, 2021 with the Securities and Exchange Commission (“SEC”) on Thursday, August 12, 2021.
Second Quarter 2021 Financial Highlights
- Net revenues for the quarter ended June 30, 2021 were $5.7 million, compared to $4.0 million for the quarter ended June 30 2020 which was an increase of approximately 41%.
- For the quarter ended June 30, 2021, gross profit was $3.4 million, or 61% of revenues, compared to $2.2 million, or 55% of revenues, for the quarter ended June 30, 2020 which was an increase of 56%.
- Selling, general, administrative, and other expenses (“SG&A”) for the quarter ended June 30, 2021 was approximately $2.0 million compared to $1.1 million for the quarter ended June 30, 2020.
- Commissions expense for the quarter ended June 30, 2021 increased to $1.8 million from $1.4 million for the quarter ended June 30, 2020, an increase of approximately $414,133.
- For the quarter ended June 30, 2021, net loss was $85,481 compared to $423,431 for the quarter ended June 30, 2020, reflecting a reduction in our net loss of $337,950 or approximately 80%.
Christopher C. Reeg, Chief Executive Officer of Fuse Medical, commented “We are pleased with our second quarter performance, as highlighted by a 41% increase in revenue, and a 56% increase in gross profit over the prior-year period. Our implementation and achievement of strategic initiatives, which includes increasing our portfolio of manufactured products, continued research and development of unique intellectual property for commercialization, investing in our sales team, and expansion of our national distribution footprint are reflected in our second quarter results.”
“Our growth for the remainder of 2021 is focused on new product launches in the biologics, orthopedics, and spine marketplace. With the alpha launch and successful first surgical implantation of the Orbitum™ Compression Staple System in the second quarter, we expect this disruptive technology for the extremity market will drive growth in the near term, while increasing our visibility as an emerging manufacturer of relevant medical devices.”
About Fuse Medical, Inc.
Fuse is an emerging manufacturer and distributor of innovative medical devices for the orthopedic and spine marketplace. We provide a comprehensive portfolio of products in the orthopedic total joints, sports medicine, trauma, foot and ankle space, as well as, degenerative and deformity spine, osteobiologics, wound care, and regenerative products. For more information about the Company, or if you’re interested in becoming a distributor of any Fuse’s products, please contact us at info@fusemedical.com or visit: www.fusemedical.com.
Forward Looking Statements
Certain statements in this press release, constitute “forward-looking statements” within the meaning of the federal securities laws. Words such as “may,” “might,” “will,” “should,” “believe,” “expect,” “anticipate,” “estimate,” “continue,” “predict,” “forecast,” “project,” “plan,” “intend,” or similar expressions or statements regarding intent, belief, or current expectations, are forward-looking statements. While the Company believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based only on information available to the Company as of the date of this release. These forward-looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including, without limitation, those set forth in the Company’s filings with the Securities and Exchange Commission; the failure of the Company to close the transaction; and integration issues with the consolidated company. Thus, actual results could be materially different. The Company expressly disclaims any obligation to update or alter statements whether as a result of new information, future events, or otherwise, except as required by law.
FUSE MEDICAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in dollars, except share data) |
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June 30,
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December 31,
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(Unaudited) |
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Assets |
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Current assets: |
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|
|
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|
|
|
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Cash |
|
$ |
1,356,876 |
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|
$ |
1,187,458 |
|
Accounts receivable, net of allowance of $941,283 and $787,766, respectively |
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|
3,051,935 |
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4,427,896 |
|
Inventories, net of allowance of $2,644,223 and $3,077,728, respectively |
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|
8,312,711 |
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6,981,413 |
|
Prepaid expenses and other current assets |
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|
61,098 |
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|
24,203 |
|
Total current assets |
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12,782,620 |
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12,620,970 |
|
Property and equipment, net |
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10,799 |
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17,791 |
|
Long term accounts receivable, net of allowance of $3,275,276 and $2,615,834, respectively |
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2,129,026 |
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1,669,510 |
|
Intangible assets, net |
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1,112,814 |
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1,138,080 |
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Goodwill |
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1,972,886 |
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|
1,972,886 |
|
Total assets |
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$ |
18,008,145 |
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$ |
17,419,237 |
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Liabilities and Stockholders' Equity (Accumulated Deficit) |
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Current liabilities: |
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Accounts payable |
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$ |
4,304,891 |
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$ |
3,236,592 |
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Accrued expenses |
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2,819,523 |
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2,584,734 |
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Convertible notes payable - related parties |
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150,000 |
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150,000 |
|
Paycheck Protection Program Loan |
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- |
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361,400 |
|
Economic Injury Disaster Loan - short term portion |
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4,459 |
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2,241 |
|
Senior secured revolving credit facility |
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|
913,352 |
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|
913,352 |
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Total current liabilities |
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8,192,225 |
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7,248,319 |
|
Notes payable - related parties |
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200,000 |
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200,000 |
|
Economic Injury Disaster Loan - long term portion |
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|
145,541 |
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147,759 |
|
Earn-out liability |
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11,936,000 |
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11,936,000 |
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Total liabilities |
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20,473,766 |
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19,532,078 |
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Commitments and contingencies |
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— |
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— |
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Stockholders' equity (accumulated deficit) |
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Preferred stock, $0.01 par value; 20,000,000 shares authorized, no shares issued and outstanding |
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— |
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— |
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Common stock, $0.01 par value; 100,000,000 shares authorized, 73,124,458 shares issued and outstanding as of June 30, 2021 and December 31, 2020. |
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731,245 |
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731,245 |
|
Additional paid-in capital |
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1,370,245 |
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1,184,222 |
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Accumulated deficit |
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(4,567,111 |
) |
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(4,028,308 |
) |
Total stockholders' equity (accumulated deficit) |
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(2,465,621 |
) |
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|
(2,112,841 |
) |
Total liabilities and stockholders' equity (accumulated deficit) |
|
$ |
18,008,145 |
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|
$ |
17,419,237 |
|
FUSE MEDICAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in dollars, except share data) |
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For the Three Months Ended
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For the Six Months Ended
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2021 |
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2020 |
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2021 |
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2020 |
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Net revenues |
$ |
5,665,015 |
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|
$ |
4,010,666 |
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$ |
10,105,774 |
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$ |
8,647,169 |
|
Cost of revenues |
|
2,219,608 |
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|
1,796,663 |
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|
|
4,073,473 |
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3,779,559 |
|
Gross profit |
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3,445,407 |
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2,214,003 |
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6,032,301 |
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4,867,610 |
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Operating expenses: |
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|
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Selling, general, administrative and other |
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2,021,576 |
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1,161,476 |
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3,456,887 |
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3,642,247 |
|
Commissions |
|
1,834,372 |
|
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|
1,420,239 |
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3,399,125 |
|
|
|
2,811,356 |
|
Depreciation and amortization |
|
15,465 |
|
|
|
30,752 |
|
|
|
32,258 |
|
|
|
60,735 |
|
Total operating expenses |
|
3,871,413 |
|
|
|
2,612,467 |
|
|
|
6,888,270 |
|
|
|
6,514,338 |
|
Operating loss |
|
(426,006 |
) |
|
|
(398,464 |
) |
|
|
(855,969 |
) |
|
|
(1,646,728 |
) |
Other (income) expense: |
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|
|
|
|
|
|
|
|
|
|
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Interest expense |
|
16,048 |
|
|
|
24,021 |
|
|
|
35,048 |
|
|
|
55,022 |
|
Gain on Payroll Protection Loan extinguishment |
|
(361,400 |
) |
|
|
- |
|
|
|
(361,400 |
) |
|
|
- |
|
Total other (income) expense |
|
(345,352 |
) |
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|
24,021 |
|
|
|
(326,352 |
) |
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|
55,022 |
|
Net loss before tax |
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(80,654 |
) |
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|
(422,485 |
) |
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(529,617 |
) |
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(1,701,750 |
) |
Income tax benefit |
|
4,826 |
|
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|
946 |
|
|
|
9,186 |
|
|
|
5,680 |
|
Net loss |
$ |
(85,480 |
) |
|
$ |
(423,431 |
) |
|
$ |
(538,803 |
) |
|
$ |
(1,707,430 |
) |
Net loss per common share - basic |
$ |
(0.00 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.02 |
) |
Weighted average number of common shares outstanding - basic |
|
70,221,566 |
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|
|
70,221,566 |
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|
70,221,566 |
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|
70,221,566 |
|
FUSE MEDICAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) |
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For the Six Months Ended June 30, |
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2021 |
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2020 |
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Cash flows from operating activities |
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Net loss |
|
$ |
(538,803 |
) |
|
$ |
(1,707,430 |
) |
Adjustments to reconcile net loss to net cash provided by operating activities: |
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Depreciation and amortization |
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|
32,258 |
|
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|
60,735 |
|
Stock based compensation |
|
|
186,023 |
|
|
|
327,098 |
|
Provision for bad debts and discounts |
|
|
153,517 |
|
|
|
186,359 |
|
Provision for long term accounts receivable |
|
|
659,442 |
|
|
|
604,194 |
|
Provision for slow moving inventory |
|
|
(433,505 |
) |
|
|
(621,604 |
) |
Gain on Payroll Protection Program Loan extinguishment |
|
|
(361,400 |
) |
|
|
- |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
1,222,444 |
|
|
|
2,076,373 |
|
Inventories |
|
|
(897,793 |
) |
|
|
1,425,600 |
|
Prepaid expenses and other current assets |
|
|
(36,895 |
) |
|
|
(47,902 |
) |
Long term accounts receivable |
|
|
(1,118,958 |
) |
|
|
(1,510,486 |
) |
Accounts payable |
|
|
1,068,299 |
|
|
|
(513,268 |
) |
Accrued expenses |
|
|
234,789 |
|
|
|
(238,198 |
) |
Net cash provided by operating activities |
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|
169,418 |
|
|
|
41,471 |
|
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|
|
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Cash flows from investing activities |
|
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|
|
|
|
|
|
Purchase of property and equipment |
|
|
- |
|
|
|
(20,757 |
) |
Net cash (used in) investing activities |
|
|
- |
|
|
|
(20,757 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
Payments on senior secured revolving credit facility, net |
|
|
- |
|
|
|
(664,149 |
) |
Proceeds from Paycheck Protection Program |
|
|
- |
|
|
|
361,400 |
|
Proceeds from Economic Injury Disaster Loan |
|
|
- |
|
|
|
150,000 |
|
Proceeds from related party promissory notes |
|
|
- |
|
|
|
200,000 |
|
Net cash provided by (used in) financing activities |
|
|
- |
|
|
|
47,251 |
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash |
|
|
169,418 |
|
|
|
67,965 |
|
Cash and cash equivalents - beginning of period |
|
|
1,187,458 |
|
|
|
1,099,310 |
|
Cash and cash equivalents - end of period |
|
$ |
1,356,876 |
|
|
$ |
1,167,275 |
|
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
|
|
Cash paid for interest |
|
$ |
21,235 |
|
|
$ |
40,018 |
|
Contacts
Fuse Medical, Inc.
Devon Morgan, Sr. Investor Relations Analyst
Office (469) 862-3030
Facsimile (469) 862-3035
info@Fusemedical.com
Editor Details
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Company:
- Businesswire
