Sensus Healthcare (SRTS) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue increased 104% year-over-year to $9.2M, driven by higher SRT system sales and strong customer demand, with net income of $1.6M and adjusted EBITDA of $2.1M.

• Shipped 23 SRT systems in Q2 2024, up from 13 in Q2 2023, including 3 to international markets; significant uptake of SRT Vision systems and international expansion in Asia.

• The "Fair Deal Agreement" recurring revenue model, launched in March 2024, has 15 signed contracts and is expected to reach up to 50 by year-end, with recurring revenues beginning in 2025.

• Company operates in one reportable segment focused on medical devices for dermatology, with the majority of revenue from the U.S. market and a single customer accounting for 83% of Q2 2024 revenue.

• International expansion includes first SRT-100 Vision system sale in Taiwan and shipments to China, with ongoing efforts to open 2-3 new territories per year.

Financial highlights

• Q2 2024 revenue: $9.2M (up from $4.5M in Q2 2023); H1 2024 revenue: $20M (up from $8M in H1 2023).

• Q2 2024 gross profit: $5.4M (58.7% margin), up from $2.6M (57.9%) in Q2 2023.

• Q2 2024 net income: $1.6M ($0.10/share), compared to a net loss of $0.4M ($0.02/share) in Q2 2023.

• Adjusted EBITDA for Q2 2024 was $2.1M, compared to -$1M in Q2 2023.

• Cash and cash equivalents were $19M as of June 30, 2024, with no outstanding borrowings.

Outlook and guidance

• Up to 50 Fair Deal Agreements expected by year-end, with most installations in Q4 2024 and recurring revenue impact starting in 2025.

• Gross margin expected to remain around 60% for the remainder of the year.

• Management anticipates continued revenue growth, supported by increased sales, expanded inventory, and SRT adoption for non-melanoma skin cancer and keloids.

• Preparing inventory for higher expected unit sales in the second half of 2024.

• Inflationary pressures are being monitored, with proactive inventory management to mitigate cost impacts.