IRADIMED CORP

Previous wording

We develop, manufacture, market and distribute Magnetic Resonance Imaging (“MRI”) compatible medical devices and accessories, disposables and services relating to them.

Current wording

We develop, manufacture, market and distribute MRI compatible medical devices and accessories, disposables and services relating to them.

Previous wording

We are a leader in the development of innovative MRI compatible medical devices. We are the only known provider of a non-magnetic intravenous (“IV”) infusion pump system that is specifically designed to be safe for use during MRI procedures. We were the first to develop an infusion delivery system that largely eliminates many of the dangers and problems present during MRI procedures. Standard infusion pumps contain magnetic and electronic components which can create radio frequency interference and are dangerous to operate in the presence of the powerful magnet that drives an MRI system. Our patented MRidium® MRI compatible IV infusion pump system has been designed with a non-magnetic ultrasonic motor, uniquely designed non-ferrous parts and other special features to safely and predictably deliver anesthesia and other IV fluids during various MRI procedures. Our pump solution provides a seamless approach that enables accurate, safe and dependable fluid delivery before, during and after an MRI scan, which is important to critically ill patients who cannot be removed from their vital medications, and children and infants who must generally be sedated to remain immobile during an MRI scan.

Current wording

We are a leader in the development of innovative MRI compatible medical devices. We are the only known provider of a non-magnetic IV infusion pump system that is specifically designed to be safe for use during MRI procedures. We were the first to develop an infusion delivery system that largely eliminates many of the dangers and problems present during MRI procedures. Standard infusion pumps contain magnetic and electronic components which can create radio frequency interference and are dangerous to operate in the presence of the powerful magnet that drives an MRI system. Our patented MRidium® MRI compatible IV infusion pump system has been designed with a non-magnetic ultrasonic motor, uniquely designed non-ferrous parts and other special features to safely and predictably deliver anesthesia and other IV fluids during various MRI procedures. Our pump solution provides a seamless approach that enables accurate, safe and dependable fluid delivery before, during and after an MRI scan, which is important to critically ill patients who cannot be removed from their vital medications, and children and infants who must generally be sedated to remain immobile during an MRI scan.

Previous wording

Each IV infusion pump system consists of an MRidium® MRI compatible IV infusion pump, non-magnetic mobile stand, proprietary disposable IV tubing sets and many of these systems contain additional optional upgrade accessories.

Current wording

Each IV infusion pump system generally consists of an MRidium® MRI compatible IV infusion pump, non-magnetic mobile stand, proprietary disposable IV tubing sets and many of these systems contain additional optional upgrade accessories.

Previous wording

We generate revenue from the sale of MRI compatible medical devices and accessories, extended warranty agreements, services related to maintaining our products and the sale of disposable products used with our devices. The principal customers for our MRI compatible products include hospitals and acute care facilities, both in the United States and internationally. As of December 31, 2023, our direct U.S. sales force consisted of 25 field sales representatives, 3 regional sales directors and supplemented by 7 clinical application specialists. Internationally, we have distribution agreements with independent distributors selling our products.

Current wording

We generate revenue from the sale of MRI compatible medical devices and accessories, extended warranty agreements, services related to maintaining our products and the sale of disposable products used with our devices. The principal customers for our MRI compatible products include hospitals and acute care facilities, both in the United States and internationally. As of December 31, 2024, our direct U.S. sales force consisted of 27 field sales representatives, 4 regional sales directors and supplemented by 10 clinical application specialists. Internationally, we have distribution agreements with independent distributors selling our products.

Previous wording

Selling cycles for our devices have varied widely and have historically ranged between three and six months in duration with more recent trends lengthening beyond this historical range due to lingering pandemic issues. We also enter into agreements with IDNs and healthcare supply contracting companies, which are commonly referred to as GPOs in the U.S., which enable us to sell and distribute our products to their member hospitals. GPOs negotiate volume

Current wording

Selling cycles for our devices have varied widely and have historically ranged between three and six months in duration. We also enter into agreements with IDNs and healthcare supply contracting companies, which are commonly referred to as GPOs in the U.S., which enable us to sell and distribute our products to their member hospitals. GPOs negotiate volume purchase prices for hospitals, group practices, and other clinics that are members of a GPO. Under our

Previous wording

purchase prices for hospitals, group practices, and other clinics that are members of a GPO. Under our GPO agreements, we are required to pay the GPOs a fee of three percent of the sales of our products to members of the GPO. Sales to participating IDNs do not have an associated fee.

Current wording

GPO agreements, we are required to pay the GPOs a fee of three percent of the sales of our products to members of the GPO. Sales to participating IDNs do not have an associated fee.

Previous wording

Our revenue was $65.6 million in 2023 and $53.3 million in 2022. Our diluted earnings per share was $1.35 in 2023, and $1.02 in 2022. Our cash provided by operations was $13.5 million in 2023, and $10.0 million in 2022.

Current wording

Our revenue was $73.2 million in 2024 and $65.6 million in 2023. Our diluted earnings per share was $1.50 in 2024, and $1.35 in 2023. Our cash provided by operations was $25.6 million in 2024, and $13.5 million in 2023.

Previous wording

Customer sale prices for our medical devices and related disposables and services are contractually fixed over the contract term. We recognize a receivable at the point in time we have an unconditional right to payment. Payment terms are typically within 45 days after transferring control to U.S. customers. Most international distributors are required to pay a portion of the transaction price in advance and the remaining amount within 30 days of receiving the related products. Accordingly, we have elected to use the practical expedient that allows us to ignore the possible existence of a significant financing component within the contract.

Current wording

terms are typically within 45 days after transferring control to U.S. customers. Most international distributors are required to pay a portion of the transaction price in advance and the remaining amount within 30 days of receiving the related products. Accordingly, we have elected to use the practical expedient that allows us to ignore the possible existence of a significant financing component within the contract.

Previous wording

Revenue from sales in the U.S. increased $8.6 million, or 19.7 percent, to $52.5 million from $43.9 million for the same period in 2022. Revenue from sales internationally increased $3.6 million, or 38.6 percent, to $13.0 million from $9.4 million for the same period in 2022. Domestic sales accounted for 80.1 percent of total revenue for the year ended December 31, 2023, compared to 82.4 percent for the same period in 2022.

Current wording

For the year ended December 31, 2024, revenue from sales in the U.S. increased $8.1 million, or 15.4 percent, to $60.6 million from $52.5 million for the same period in 2023. Revenue from sales internationally decreased $0.4 million, or 3.1 percent, to $12.6 million from $13.0 million for the same period in 2023. Domestic sales accounted for 83 percent of total revenue for the year ended December 31, 2024, compared to 80 percent for the same period in 2023.

Previous wording

Revenue from sales of devices increased $9.5 million, or 25.9 percent, to $46.0 million from $36.5 million for the same period in 2022. This increase was the result of higher overall unit sales, particularly our IV infusion pump systems.

Current wording

For the year ended December 31, 2024, revenue from sales of devices increased $6.0 million, or 13.0 percent, to $51.9 million from $45.9 million for the same period in 2023. This increase was the result of higher overall unit sales, particularly our IV infusion pump systems.

Previous wording

Revenue from sales of our disposables, service and other increased $3.0 million, or 20.2 percent, to $17.6 million from $14.6 million for the same period in 2022. Revenue from the amortization of our extended warranty agreements decreased $0.2 million, or 7.5%, to $2.0 million from $2.2 million for the same period in 2022. The increase in ancillary product sales aligns with the increased sales of our devices. The decline in revenue from the amortization of deferred revenue year-over-year is primarily due to a higher initial volume of deferred revenue during the pandemic, as more companies were purchasing extended warranties at that time.

Current wording

For the year ended December 31, 2024, revenue from sales of our disposables, service and other increased $1.5 million, or 8.5 percent, to $19.1 million from $17.6 million for the same period in 2023. Revenue from the amortization of our extended warranty agreements increased $0.2 million, or 11.7 percent, to $2.2 million from $2.0 million for the same period in 2023. The increase in ancillary product sales and revenue from amortization aligns with the increased gross sales of our devices.

Previous wording

Cost of revenue increased approximately $3.4 million, or 28.1 percent, to $15.4 million for the year ended December 31, 2023, from $12.0 million for the same period in 2022. Gross profit increased approximately $8.9 million, or 21.5 percent, to $50.2 million for the year ended December 31, 2023 from $41.3 million for the same period in 2022. The increase in cost of revenue and gross profit is primarily due to higher revenue during the year ended December 31, 2023, compared to the same period in 2022.

Current wording

Cost of revenue increased approximately $1.5 million, or 9.7 percent, to $16.9 million for the year ended December 31, 2024, from $15.4 million for the same period in 2023. Gross profit increased approximately $6.1 million, or 12.1 percent, to $56.3 million for the year ended December 31, 2024 from $50.2 million for the same period in 2023. The increase in cost of revenue and gross profit is primarily due to higher revenue during the year ended December 31, 2024, compared to the same period in 2023.

Previous wording

Gross profit margin was 76.5 percent and 77.4 percent for the years ended December 31, 2023 and 2022, respectively. The increase in gross profit margin is the result of favorable overhead variance adjustments and higher average selling prices in 2023 compared to 2022, offset by increased raw material costs due to inflation. The increase

Current wording

Gross profit margin was 76.9 percent and 76.5 percent for the years ended December 31, 2024 and 2023, respectively. The increase in gross profit margin is the result of favorable overhead variance adjustments and higher average selling prices in 2024 compared to 2023, a reduction in raw material costs, and increased management oversight of inventory. The increase in year over year sales also positively impacts the Company’s ability to favorably absorb overhead costs and increase gross profit margin.

Previous wording

General and administrative expense increased approximately $4.4 million, or 41.4 percent, to $15.1 million for the year ended December 31, 2023, from $10.7 million for the same period last year. This increase is primarily due to higher expenses for legal and professional costs, regulatory approval and consulting costs, and payroll and employee benefits costs. These increases are a direct result of the continuous growth of the Company and need for additional support resources.

Current wording

General and administrative expense increased approximately $0.8 million, or 5.4 percent, to $15.9 million for the year ended December 31, 2024, from $15.1 million for the same period in 2023. This increase is primarily due to higher expenses for legal and professional costs, regulatory approval and consulting costs, and payroll and employee benefits costs. These increases are a direct result of the continued growth of the Company and need for additional support resources.

Previous wording

Sales and marketing expenses decreased approximately $0.6 million, or 4.3 percent, to $12.1 million for the year ended December 31, 2023, from $12.7 million for the same period in 2022. This decrease is primarily the result of lower expenses for sales commissions, partially offset by higher expenses for payroll and benefits. Lower commissions are related to the sales cycle, and not necessarily in line with revenue growth. The increases are a direct result of the continuing growth of the Company.

Current wording

Sales and marketing expenses increased approximately $3.5 million, or 28.6 percent, to $15.6 million for the year ended December 31, 2024, from $12.1 million for the same period in 2023. This increase is primarily the result of increased expenses for sales commissions, sales-related travel costs, and higher expenses for payroll and benefits. Higher commissions are related to the sales cycle, and in line with revenue growth. The increases are a direct result of the continued growth of the Company.

Previous wording

Research and development expense increased approximately $0.6 million, or 25.5 percent, to $2.9 million for the year ended December 31, 2023, from $2.3 million for the same period in 2022. This is primarily due to higher payroll and benefits costs, offset by lower prototype design and consulting expenses.

Current wording

Research and development expense remained relatively consistent at $2.8 million for the year ended December 31, 2024, compared to $2.9 million for the same period in 2023. This is primarily due to higher payroll and benefits costs, offset by lower prototype design and consulting expenses.

Previous wording

Other income, net consists of interest income, foreign currency transactional gains and losses, and other miscellaneous income. We reported other income of approximately $1.7 million and $0.6 million for the years ended December 31, 2023 and 2022, respectively. This increase is primarily the result of higher interest income during the year ended December 31, 2023 compared to the same period in 2022.

Current wording

Other income, net consists of interest income, foreign currency transactional gains and losses, and other miscellaneous income. We reported other income of approximately $2.3 million and $1.7 million for the years ended December 31, 2024 and 2023, respectively. This increase is primarily the result of higher interest income during the year ended December 31, 2024 compared to the same period in 2023.

Previous wording

We recorded a provision for income tax expense of approximately $4.5 million for the year ended December 31, 2023, compared to a tax expense of approximately $3.4 million for the year ended December 31, 2022. Our effective tax rate for the year ended December 31, 2023 was 20.8 percent compared to 20.7 percent for the same period in 2022. The increase in our effective tax rate is primarily the result of higher book income before the provision for income taxes.

Current wording

We recorded a provision for income tax expense of approximately $5.0 million for the year ended December 31, 2024, compared to a tax expense of approximately $4.5 million for the same period in 2023. Our effective tax rate for the year ended December 31, 2024 was 20.8 percent compared to 20.9 percent for the same period in 2023. The decrease in our effective tax rate is negligible and attributable to a number of immaterial factors.

Previous wording

Our principal sources of liquidity have historically been our cash and cash equivalents balances, our investments, cash flow from operations and access to the financial markets. Our principal uses of cash are operating expenses, working capital requirements and capital expenditures.

Current wording

Our principal sources of liquidity have historically been our cash and cash equivalents balances, our investments, cash flow from operations and access to the financial markets. Our principal uses of cash are operating expenses, working capital requirements, capital expenditures and dividend payments.

Previous wording

As of December 31, 2023, we had cash and investments of $49.8 million, stockholders’ equity of $71.4 million, and working capital of $59.7 million, compared to cash and cash equivalents and investments of $58.0 million, stockholders’ equity of $73.7 million, and working capital of $68.9 million as of December 31, 2022.

Current wording

As of December 31, 2024, we had cash and investments of $52.2 million, stockholders’ equity of $86.8 million, and working capital of $66.2 million, compared to cash and cash equivalents and investments of $49.8 million, stockholders’ equity of $71.4 million, and working capital of $59.7 million as of December 31, 2023.

Previous wording

For the year ended December 31, 2023, cash provided by operations increased $3.5 million to $13.5 million, from $10.0 million in 2022. During 2023, cash provided by operations was positively impacted by higher net income, accounts receivable, stock compensation, and deferred revenue. Cash provided by operations was negatively impacted by inventory, accounts payable, and deferred income taxes.

Current wording

For the year ended December 31, 2024, cash provided by operations increased $12.1 million to $25.6 million, from $13.5 million in 2023. During 2024, cash provided by operations was positively impacted by higher net income, lower inventory, lower accounts receivable, and increased stock compensation. Cash provided by operations was negatively impacted by higher accounts payable and other accruals, higher deferred revenue, and higher deferred income taxes.

Previous wording

For the year ended December 31, 2023, cash related to investing activities decreased $6.6 million to a use of $8.0 million, from $1.4 million used in 2022. During 2023, cash related to investing activities was impacted by purchases of property and equipment, specifically the purchase of land. During 2022, cash related to investing activities was impacted by maturities of investments, purchases of property and equipment, and capitalized intangible assets.

Current wording

For the year ended December 31, 2024, cash used in investing activities increased $0.8 million to $8.8 million, from $8.0 million used in 2023. During 2024, cash related to investing activities was impacted by purchases of property and equipment, specifically ongoing construction costs for our new corporate office and manufacturing facility in Orange County, Florida.

Previous wording

For the year ended December 31, 2023, cash related to financing activities decreased $1.0 million to a use of $13.7 million, from $12.7 million used in 2022. During 2023, cash used in financing activities was related to a cash payment for a dividend and taxes paid for the net share settlement of restricted stock units.

Current wording

For the year ended December 31, 2024, cash used in financing activities increased $0.6 million to $14.3 million, from $13.7 million used in 2023. During 2024, cash used in financing activities was related to cash payments for dividends and taxes paid for the net share settlement of restricted stock units.

Previous wording

Our manufacturing operations and headquarters facility is approximately 23,100 square feet located in Winter Springs, Florida. This facility has been leased from Susi, LLC, an entity controlled by our President, Chief Executive Officer, and Chairman, Roger Susi. Pursuant to the terms of our lease, the monthly base rent is $34,133, adjusted annually for changes in the consumer price index.

Current wording

Our manufacturing operations and headquarters facility is approximately 23,100 square feet located in Winter Springs, Florida. This facility has been leased from Susi, LLC, an entity controlled by our President, Chief Executive Officer, and Chairman, Roger Susi. Pursuant to the terms of the Amended Lease Amendment, the monthly base rent is $34,133, adjusted annually for changes in the consumer price index.

Previous wording

We believe our sources of liquidity, including cash flow from operations, existing cash, and available financing sources will be sufficient to meet our projected cash requirements for at least the next 12 months from the date the financial statements are issued. Any equity financing may be dilutive to stockholders, and debt financing, if available, may involve restrictive covenants that increase our costs. We monitor our capital requirements to ensure our needs are in line with available capital resources. From time to time, we may explore additional financing sources to meet our working capital requirements, make continued investment in research and development, expand our business and acquire products or businesses that complement our current business. These actions would likely affect our future capital

Current wording

We believe our sources of liquidity, including cash flow from operations, existing cash, and available financing sources will be sufficient to meet our projected cash requirements for at least the next 12 months from the date the financial statements are issued and into the foreseeable future. Any equity financing may be dilutive to stockholders, and debt financing, if available, may involve restrictive covenants that increase our costs. We monitor our capital requirements to ensure our needs are in line with available capital resources. From time to time, we may explore additional financing sources to meet our working capital requirements, make continued investment in research and development, expand our business and acquire products or businesses that complement our current business. These actions would likely affect our future capital requirements and the adequacy of our available funds. Our future liquidity and capital requirements will depend on numerous factors, including the: