8-K
DYNATRONICS CORP (DYNTQ)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549 ___________________________
FORM 8-K
CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
November 9, 2023
DYNATRONICS CORP.(Exact name of registrant as specified in its charter)
| Utah | 000-12697 | 87-0398434 |
|---|---|---|
| (State or other jurisdiction | (Commission | (IRS Employer |
| of incorporation) | File Number) | Identification No.) |
1200 Trapp Rd.
Eagan, Minnesota, United States
55121
\(Address of principal executive offices\) \(ZIP Code\)
Registrant’s telephone number, including area code: (801) 568-7000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbols | Name of each exchange on which registered |
|---|---|---|
| Common stock, no par value | DYNT | NASDAQ Capital Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b -2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition
On November 9, 2023, Dynatronics Corporation ("Company") issued a press release reporting, among other things, financial results relating to the quarter ended September 30, 2023. Also, as previously announced by a press release issued on October 26, 2023, on November 9, 2023, the Company held a conference call in which executives of the Company reviewed the fiscal 2024 first quarter results. An audio replay of the call will be available one hour after the live call until Midnight on December 9, 2023, by dialing 1-800-408-3053 and entering the passcode 6594208# (U.S./Canada callers) or visiting this link https://www.confsolutions.ca/ILT?oss=4P1R8004083053 (international callers). The full text of the press release is furnished herewith as Exhibit 99.1.
The information under this Item 2.02 and in Exhibit 99.1, is being "furnished" and is not being "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 and is not to be incorporated by reference into any filing of the registrant under the Securities Act of 1933, whether made before or after the date hereof, regardless of any general incorporation language in any such filing, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit | Description |
|---|---|
| 99.1 | Press Release dated November 9, 2023 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: November 9, 2023 | DYNATRONICS CORPORATION | |
|---|---|---|
| By: | /s/ Brian D. Baker | |
| Name: | Brian D. Baker | |
| Title: | Chief Executive Officer |
Dynatronics Corp.: Exhibit 99.1 - Filed by newsfilecorp.com
Dynatronics Corporation Reports First Quarter Fiscal Year 2024 Financial Results
EAGAN, MN / ACCESSWIRE / November 9, 2023 / Dynatronics Corporation (NASDAQ:DYNT) ("Dynatronics" or the "Company"), a leading manufacturer of athletic training, physical therapy, and rehabilitation products, today reported financial results for its first quarter of fiscal year 2024 ended September 30, 2023.
CEO Commentary
"We met our sales expectations and were profitable on an EBITDA basis in the first quarter," said Brian Baker, Chief Executive Officer of Dynatronics. "We must continue to improve our performance and refine our execution, but the early results this year are encouraging. Our teams are committed to meeting our customers' needs, while focusing on cost reduction and margin expansion opportunities over the long-term."
Key Financial Results
Q1 Fiscal Year '24 Financial Highlights
Note: All financials referenced in this release are in conformity with U.S. Generally Accepted Accounting Principles ("GAAP") and comparisons in this release are to the same period in the prior year unless otherwise noted.
- Total net sales of $9.4 million.
- Gross profit margin of 24.7%.
- Net loss of $0.3 million improved from $0.5 million in Q1 fiscal year '23.
Notable Balance Sheet Highlights
- Net cash of $0.6 million unchanged from $0.6 million as of June 30, 2023.
- As of September 30, 2023, $1.8 million drawn, with an additional $2.8 million available on working capital asset-based line of credit established on August 1, 2023.
- Proceeds from line of credit reduced accounts payable and accrued expenses by $0.9 million and funded $0.8 million of prepaid expenses.
Guidance for Fiscal Year '24
Dynatronics reaffirmed net sales guidance for fiscal year '24 of $34 million to $37 million. The Company expects the distribution of net sales across the quarters in fiscal year '24 to align with historical trends, which are highest in the first quarter, lower in the second and third quarters, with a bounce back in the fourth quarter.
The Company is continuing its recent practice of not providing gross margin guidance given the recent reductions in revenue and operating costs.
The Company reaffirmed its guidance on Selling, general, and administrative expenses that are anticipated to be 29% to 33% of net sales in fiscal year '24.
The Company's financial guidance for fiscal year '24 is subject to the risks identified in its safe harbor notification below. The Company continues to expect volatility due to the challenges related to the broader economic environment, including competitive pressures, inflationary pressures, supply chain disruptions, extended handling times and delays or disruption in procedure volume. Dynatronics also expects some ongoing volatility from the Company's business optimization.
Conference Call Q1 Fiscal Year '24 Results
The company will hold a conference call, consisting of prepared remarks by management, and a question-and-answer session with analysts, at 11:00 AM ET on Thursday, November 9, 2023, to review its first quarter results.
Interested persons may access the live conference call by dialing 1-800-898-3989 and entering the passcode 1005804# (U.S./Canada callers) or by visiting this link https://www.confsolutions.ca/ILT?oss=7P1R8008983989 (international callers), using passcode 1005804#. It is recommended that participants call or login 10 minutes ahead of the scheduled start time to ensure proper connection. An audio replay will be available one hour after the live call until Midnight on December 9, 2023, by dialing 1-800-408-3053 and entering the passcode 6594208# (U.S./Canada callers) or visiting this link https://www.confsolutions.ca/ILT?oss=4P1R8004083053 (international callers).
About Dynatronics Corporation
Dynatronics is a leading medical device company committed to providing high-quality restorative products designed to accelerate achieving optimal health. The Company designs, manufactures and sells a broad range of products for clinical use in physical therapy, rehabilitation, pain management, and athletic training. Through its distribution channels, Dynatronics markets and sells to orthopedists, physical therapists, chiropractors, athletic trainers, sports medicine practitioners, clinics, hospitals, and consumers. The Company's products are marketed under a portfolio of high-quality, well-known industry brands including Bird & Cronin®, Solaris™, Hausmann®, Physician's Choice®, and PROTEAM™, among others. More information is available at www.dynatronics.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Those statements include references to the Company's expectations and similar statements. Such forward-looking statements reflect the views of management at the time such statements are made. These statements include our statements regarding the Company's planned management transition, expected overall performance, expectations regarding net sales, distribution of net sales, and selling general and administrative costs in fiscal year 2024, and uncertainties related to the broader economic environment, including higher raw material, delivery and shipment costs, supply chain disruptions, extended handling times and delays or disruption in procedure volume and volatility resulting from continued execution of the Company's business optimization strategy. These forward-looking statements are subject to a number of risks, uncertainties, estimates, and assumptions that may cause actual results to differ materially from current expectations. The contents of this release should be considered in conjunction with the risk factors, warnings, and cautionary statements that are contained in the Company's annual, quarterly, and other reports filed with the Securities and Exchange Commission. Dynatronics does not undertake to update its forward-looking statements, whether as a result of new information, future events, or otherwise.
Summary Financial Results
Following is a summary of operating results for the periods ended September 30, 2023, the balance sheet highlights at September 30, 2023 and cash flow for periods ended September 30, 2023.
Summary Selected Financial Data Statements of Operations HighlightsIn thousands, except share and per share amounts
| Quarter Ended | ||||||
|---|---|---|---|---|---|---|
| September 30, | ||||||
| 2023 | 2022 | |||||
| Net sales | $ | 9,352 | $ | 12,053 | ||
| Cost of sales | 7,046 | 8,410 | ||||
| Gross Profit | 2,306 | 3,643 | ||||
| 24.7% | 30.2% | |||||
| Selling, general and administrative expenses | 2,546 | 4,118 | ||||
| Other (expense) income, net | (91 | ) | (31 | ) | ||
| Net income (loss) | $ | (331 | ) | $ | (506 | ) |
| Preferred stock dividend, in common stock, issued or to be issued | (197 | ) | (171 | ) | ||
| Net income (loss) attributable to common stockholders | $ | (528 | ) | $ | (677 | ) |
| Net loss attributable to common stockholders per<br>common share - basic and diluted | $ | (0.12 | ) | $ | (0.18 | ) |
| Weighted-average common shares outstanding - basic and<br>diluted | 4,261,593 | 3,707,658 |
Balance Sheet HighlightsIn thousands
| September 30, 2023 | June 30, 2023 | |||
|---|---|---|---|---|
| Cash and cash equivalents and restricted cash | $ | 587 | $ | 553 |
| Trade accounts receivable, net | 4,260 | 3,722 | ||
| Inventories, net | 6,838 | 7,403 | ||
| Prepaids & other | 1,539 | 741 | ||
| Total current assets | 13,224 | 12,419 | ||
| Non-current assets | 17,123 | 17,644 | ||
| Total assets | $ | 30,347 | $ | 30,063 |
| Accounts payable | $ | 3,873 | $ | 4,530 |
| Accrued payroll and benefits expense | 488 | 878 | ||
| Accrued expenses | 1,067 | 891 | ||
| Other current liabilities | 1,671 | 1,642 | ||
| Line of credit | 1,804 | - | ||
| Total current liabilities | 8,903 | 7,941 | ||
| Non-current liabilities | 4,899 | 5,265 | ||
| Total liabilities | 13,802 | 13,206 | ||
| Stockholders' equity | 16,545 | 16,857 | ||
| Total liabilities and stockholders' equity | $ | 30,347 | $ | 30,063 |
Cash Flow HighlightsIn thousands
| Quarter Ended | ||||||
|---|---|---|---|---|---|---|
| September 30, | ||||||
| 2023 | 2022 | |||||
| Net loss | $ | (331 | ) | $ | (506 | ) |
| Depreciation and amortization | 320 | 344 | ||||
| Stock-based compensation | 19 | 60 | ||||
| (Gain) loss on sale of property and equipment | 2 | - | ||||
| Receivables | (537 | ) | (113 | ) | ||
| Inventory | 565 | 173 | ||||
| Prepaid and other assets | (793 | ) | 90 | |||
| Accounts payable, accrued expenses, and other liabilities | (910 | ) | 318 | |||
| Net cash provided by (used in) operating activities | (1,665 | ) | 366 | |||
| Net cash used in investing activities | (35 | ) | (20 | ) | ||
| Payments on non-current liabilities | 1,734 | (91 | ) | |||
| Net cash used in financing activities | 1,734 | (91 | ) | |||
| Net change in cash and cash equivalents | 34 | 255 | ||||
| Cash and cash equivalents at beginning of the period | 553 | 700 | ||||
| Cash and cash equivalents at end of the period | $ | 587 | $ | 955 |
Contact:
Dynatronics Corporation
Investor Relations
ir@dynatronics.com
For additional information, please visit: www.dynatronics.com
Connect with Dynatronics on LinkedIn
SOURCE: Dynatronics Corporation