Company reports net income of $1.5 million on significant revenue growth
PLAINVIEW, NY / ACCESSWIRE / August 15, 2022 / Vaso Corporation ("Vaso") (OTC PINK:VASO) today reported its operating results for the three months ended June 30, 2022.
"For the second quarter of 2022, the Company recorded a total revenue of $19.5 million, representing a 21% increase year-over-year. As a result, net income improved substantially, to $1.5 million from a net loss of $0.9 million when excluding the PPP loan forgiveness the Company received in the second quarter last year," commented Dr. Jun Ma, President and Chief Executive Officer of Vaso Corporation. "As we stated before, we usually incur losses in the early quarters of the year due to the seasonality of our businesses; therefore, a profitable second quarter, and first half as well, in 2022 was a promising sign of a very profitable year."
"On the balance sheet, the Company's cash and cash equivalents were $15.4 million as of June 30, 2022, up from $9.4 million a year before. Total deferred revenue reached a historical high of $27.1 million at the end of second quarter. In addition, the Company continued to generate positive cashflow from operating activities, in the amount of $9.7 million during the first six months of the year, up from $5.6 million during the same period of the prior year," Dr. Ma continued. "Given the overall strength of the Company's businesses and financials, we believe that the Company is well prepared to weather the pandemic and geopolitical uncertainties that continue to negatively impact the world economy."
Financial Results for Three Months Ended June 30, 2022
For the three months ended June 30, 2022, revenue increased 21% to $19.5 million from $16.1 million for the same period of 2021. Revenue in our professional sales service segment increased $3.9 million or 78%, compared to the second quarter of 2021, as a result of higher deliveries of underlying equipment by our partner and a higher blended commission rate. Revenue in the IT segment decreased $0.4 million or 4% when compared to the second quarter of 2021, mainly due to the recurring service revenue lost during the peak of COVID-19 pandemic exceeding new customer contracts; and revenue in the equipment segment decreased $0.1 million or 12% due to lower equipment volumes in our China operations as impacted by the COVID-19 lockdown.
Gross profit for the second quarter of 2022 increased 31% to $11.3 million, compared with a gross profit of $8.6 million for the same quarter of 2021. This increase was primarily the result of the increase in revenue in the professional sales service segment.
Selling, general and administrative (SG&A) expenses for the second quarter of 2022 increased 5% to $9.6 million, when compared to the second quarter of 2021. The increase is primarily attributable to higher travel and personnel costs in the professional sales service and IT segments, partially offset by a decrease in expenses in the equipment segment as well as a decrease in corporate expenses.
Other expense, net, was $49 thousand in the second quarter, compared to other income of $3.6 million in the second quarter of 2021. In the second quarter of 2021 the Company recorded a $3.6 million gain on the forgiveness of the PPP loan.
Net income for the three months ended June 30, 2022 was $1.5 million, compared to net income of $2.8 million in the second quarter 2021, during which the gain on the forgiveness on the PPP loan was recognized.
Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization and non-cash stock-based compensation) was $2.3 million for the three months ended June 30, 2022, compared to $3.4 million for the same period a year ago.
Net cash provided by operating activities in the first six months of 2022 was $9.7 million, a 74% increase when compared to cash provided by operations of $5.6 million for the same period in 2021. As of June 30, 2022 and December 31, 2021, the Company had cash and cash equivalents of approximately $15.4 million and $6.0 million, respectively.
About Vaso
Vaso Corporation is a diversified medical technology company with several distinctive but related specialties: managed IT systems and services, including healthcare software solutions and network connectivity services; professional sales services for diagnostic imaging products; and design, manufacture and sale of proprietary medical devices.
The Company operates through three wholly owned subsidiaries:
- VasoTechnology, Inc. provides network and IT services through two business units: VasoHealthcare IT Corp., a national value added reseller of Radiology Information System ("RIS"), Picture Archiving and Communication System ("PACS"), and other software solutions from various vendors as well as related services, including implementation, management and support; and NetWolves Network Services LLC, a managed network services provider with an extensive, proprietary service platform to a broad base of customers.
- Vaso Diagnostics, Inc. d.b.a. VasoHealthcare, provides professional sales services and is the operating subsidiary for the exclusive sales representation of GE Healthcare diagnostic imaging products in certain market segments in the USA.
- VasoMedical, Inc. manages and coordinates the design, manufacture and sales of proprietary medical equipment and software, as well as operates the Company's overseas assets including China-based subsidiaries.
Additional information is available on the Company's website at www.vasocorporation.com.
Summarized Financial Information
| FOR THE THREE MONTHS ENDED | FOR THE SIX MONTHS ENDED | |||||||||||||||
STATEMENTS OF OPERATIONS | June 30, 2022 | June 30, 2021 | June 30, 2022 | June 30, 2021 | ||||||||||||
| (In thousands) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
Revenue | $ | 19,502 | $ | 16,131 | $ | 36,512 | $ | 32,651 | ||||||||
Gross profit | 11,336 | 8,640 | 21,105 | 17,200 | ||||||||||||
Operating income (loss) | 1,562 | (722 | ) | 1,207 | (1,262 | ) | ||||||||||
Other (expense) income, net | (49 | ) | 3,552 | (26 | ) | 3,467 | ||||||||||
Income before taxes | 1,513 | 2,830 | 1,181 | 2,205 | ||||||||||||
Income tax expense | (18 | ) | (50 | ) | (30 | ) | (68 | ) | ||||||||
Net income | $ | 1,495 | $ | 2,780 | $ | 1,151 | $ | 2,137 | ||||||||
Income tax expense | 18 | 50 | 30 | 68 | ||||||||||||
Interest expense (income), net | 5 | 78 | 24 | 199 | ||||||||||||
Depreciation and amortization | 805 | 528 | 1,258 | 1,124 | ||||||||||||
Non-cash stock-based compensation | 6 | 8 | 13 | 17 | ||||||||||||
Adjusted EBITDA* | $ | 2,329 | $ | 3,444 | $ | 2,476 | $ | 3,545 | ||||||||
*Adjusted EBITDA is earnings before interest, taxes, depreciation and amortization and non-cash stock-based compensation.
BALANCE SHEETS | June 30, 2022 | December 31, 2021 | ||||||
| (In thousands) | ||||||||
| (Unaudited) | ||||||||
Total current assets | $ | 29,096 | $ | 27,803 | ||||
Total assets | $ | 53,478 | $ | 52,361 | ||||
Total current liabilities | $ | 30,579 | $ | 31,000 | ||||
Total stockholders' equity | $ | 12,258 | $ | 11,310 | ||||
Except for historical information contained in this release, the matters discussed are forward-looking statements that involve risks and uncertainties. When used in this report, words such as "anticipates", "believes", "could", "estimates", "expects", "may", "optimistic", "plans", "potential", "promising" and "intends" and similar expressions, as they relate to the Company or its management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of the Company's management, as well as assumptions made by and information currently available to the Company's management. Among the factors that could cause actual results to differ materially are the following: the effect of business and economic conditions, including the impact of the current COVID-19 pandemic; the effect of the dramatic changes taking place in IT and healthcare; continuation of the GEHC agreement; the impact of competitive technology and products and their pricing; medical insurance reimbursement policies; unexpected manufacturing or supplier problems; unforeseen difficulties and delays in product development programs; the actions of regulatory authorities and third-party payers in the United States and overseas; and the risk factors reported from time to time in the Company's SEC reports. The Company undertakes no obligation to update forward-looking statements as a result of future events or developments.
Investor Contact:
Michael J. Beecher
Investor Relations
Phone: 516-508-5840
Email: [email protected]
SOURCE: Vaso Corporation