8-K

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): August23, 2022

ELECTROMED, INC.

(Exact Name of Registrant as Specified in Its Charter)

Minnesota	001-34839	41-1732920
(State or Other Jurisdiction of<br><br> <br>Incorporation)	(Commission File Number)	(I.R.S. Employer Identification<br><br> <br>Number)

500Sixth Avenue NW

NewPrague, MN 56071

(Address of Principal Executive Offices) (Zip Code)

(952)758-9299

(Registrant’s Telephone Number, Including Area Code)

NotApplicable

(Former Name or Former Address, if Changed Since Last Report)

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:

Common Stock, $0.01 par value	ELMD	NYSE American LLC
(Title of each class)	(Trading Symbol)	(Name of each exchange<br> on which registered)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

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 August 23, 2022, Electromed, Inc. issued a press release announcing its financial results for the fiscal year ended June 30, 2022. The full text of the press release is furnished as Exhibit 99.1 to this report and incorporated herein by reference.

Item 9.01	Financial Statements and Exhibits.

(d) Exhibits:

Exhibit Number	Description
99.1	Press Release, dated August 23,<br> 2022
104	Cover Page Interactive Data File (embedded in the cover page and formatted in inline XBRL)

The information contained in this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, and shall not be incorporated by reference into any registration statement pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

SIGNATURES

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.

	ELECTROMED, INC.
Date:  August 23, 2022	By: /s/ Michelle C. Wirtz
	Name:	Michelle C. Wirtz
	Title:	Interim Chief Financial Officer

Exhibit99.1

Electromed,Inc. Announces Fiscal 2022 Fourth Quarter and Full Year Financial Results

--Record Annual Revenue and Growth Rate

-- Fourth Quarter Revenue Increased 19% Year-Over-Year; Full Year Revenue Increased 16.5%

-- Leveraging Strategic Investments to Accelerate Growth --

NEW PRAGUE, Minn.--(BUSINESS WIRE)-- Electromed, Inc. (“Electromed” or the “Company”) (NYSE American: ELMD), a leader in innovative airway clearance technologies, today announced financial results for the three months (“Q4 FY 2022”) and full year (“FY 2022”) ended June 30, 2022.

Q4FY 2022 Financial Highlights

●	Net<br>revenue increased 19% to a record $11.3 million, from $9.5 million, for the three months ended June 30, 2022 (“Q4 FY 2022”),<br>driven by 21.6% home care revenue growth.
●	Operating<br>income totaled $0.5 million, compared to $0.7 million in Q4 FY 2021.
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●	Net<br>income was $0.4 million, or $0.04 per diluted share, compared to $0.4 million, or $0.04 per diluted share, in Q4 FY 2021.
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●	Repurchased<br>$0.5 million of common stock at an average price of $12.10 per share under the share repurchase program.
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●	Cash<br>as of June 30, 2022 was $8.2 million.
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FY2022 Financial Highlights

●	Net<br>revenue increased 16.5% year over year to $41.7 million, from $35.8 million, during the fiscal year ended June 30, 2022 (“FY<br>2022”), driven by 15% home care revenue growth.
●	Operating<br>income totaled $3.0 million, compared to $3.1 million in FY 2021.
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●	Net<br>income totaled $2.3 million, or $0.26 per diluted share, compared to $2.4 million, or $0.27 per diluted share, in FY 2021.
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●	Cash<br>decreased by $3.7 million during fiscal 2022, reflecting $1.5 million used in investing activities, $1.4 million used in the share<br>repurchase program and $0.7 million in net cash used in operating activities.
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FY2022 Strategic Investments to Enhance Future Growth

●	Increased<br>investment in commercial expansion including direct sales rep growth from 37 to 43 and marketing & clinical field support.
●	Increased<br>spending on research and development for next generation product.
---	---
●	Increased<br>investment in direct-to-consumer and digital marketing.
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●	Conducted<br>a comprehensive research study focused on bronchiectasis and HFCWO market strengthening respective growth strategies.
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●	Made<br>key infrastructure investments, including implementing a new revenue cycle management system.
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●	Advanced<br>clinical studies to further demonstrate the benefits of SmartVest® Airway Clearance devices; published a retrospective study<br>abstract on outcomes among non-cystic fibrosis bronchiectasis patient with high frequency Chest Wall Oscillation therapy in the<br>American Journal of Respiratory and Critical Care Medicine 2022; completed enrollment of COPD and bronchiectasis patient quality<br>of life improvement pre- and post-SmartVest therapy.
---	---

“Electromed had a highly successful fiscal 2022 as we managed through the pandemic and began to realize the benefits of our multiple strategic growth initiatives,” said Kathleen Skarvan, President and Chief Executive Officer of Electromed. “The team has delivered exceptional results, including record revenues in both the fourth quarter and the fiscal year, and growing our estimated home care market share to approximately 19% from 15% over the past three years. The continued investments in our commercial organization, marketing and brand recognition and organizational execution have been pivotal in this fiscal year’s growth and success, and we will continue on this path as we look to the year ahead.”

Fiscal2023 Strategic Priorities

Ms. Skarvan continued, “During fiscal year 2022, we made excellent strides on our four key strategic pillars: continued sales force growth, direct to consumer marketing, infrastructure to support anticipated sales growth and clinical studies. Looking forward to fiscal year 2023, we will again leverage these strategic growth initiatives to capture additional market share. Pending FDA clearance of our Next Generation SmartVest, we estimate a limited market release in fiscal quarter two. We are confident that our investments in these strategic priorities will accelerate growth and enhance shareholder value. Our long-term objectives:

●	Revenue<br> growth in the mid to high teens, and
●	Operating<br> margin improvement with revenue increases and full market release of the next generation<br> SmartVest.”
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For fiscal 2023, strategic investments and priorities include:

●	Expand<br> our sales force in targeted-geographies with high potential, adding an additional five<br> territories and direct sales reps.
●	Introduce<br> our Next-Generation SmartVest device with innovative features that will appeal to patients.
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●	Expand<br> Electromed brand awareness through direct-to-consumer and physician marketing, and peer<br> to peer education.
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●	Provide<br> best-in-class customer care and support.
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●	Further<br> develop and promulgate the body of Bronchiectasis clinical evidence to increase physician<br> adoption of the SmartVest® System for patients.
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Q4FY 2022 Review

Net revenue in the fourth quarter of the Company’s fiscal year ending June 30, 2022 (“fiscal 2022”) increased 18.9% to $11.3 million, from $9.5 million in the fourth quarter of the Company’s fiscal year ended June 30, 2021 (“fiscal 2021”), primarily driven by 21.6% growth in the home care business which benefitted from an increase in direct sales representatives, increased sales representative productivity driven by increased clinic access and patient flow, our sales team refining their selling process and clinic targeting methodology, and benefits of the CMS waiver on the non-commercial Medicare portion of our home care revenue. Field sales employees totaled 52, of which 43 were direct sales, at the end of the fourth quarter of fiscal 2022, compared to 46 at the end of the fourth quarter of fiscal 2021, of which 37 were direct sales. Sales force productivity continued to improve during the quarter, with annualized home care revenue per direct sales rep at $953,000, above the targeted range of $800,000 to $900,000.

Distributor revenue increased 300% to $0.4 million in the fourth quarter of fiscal 2022 from $0.1 million in the same period in fiscal 2021, primarily due to increased demand from one of our key distribution partners. Institutional revenue declined 6.5% to $0.5 million in the fourth quarter of fiscal 2022, and international revenue decreased 75.3% to $0.1 million in the fourth quarter of fiscal 2022.

Gross profit in the fourth quarter of fiscal 2022 increased to $8.1 million, or 72.0% of net revenues, from $6.9 million, or 73.2% of net revenues, in the fourth quarter of fiscal 2021, as rising raw material and shipping costs were offset by higher Medicare allowable pricing, increased operational efficiencies and fixed cost leverage on higher revenue. Electromed expects gross margin percentage to be in the mid 70% range during fiscal 2023, which is consistent with our historical gross margin performance range.

Operating income totaled $0.5 million in the fourth quarter of fiscal 2022, compared to $0.7 million in the fourth quarter of fiscal 2021. The higher operating cost was driven by increased strategic investment in sales, general and administrative costs, offset by 19% revenue growth compared to the fourth quarter of fiscal 2021.

Net income for the fourth quarter of fiscal 2022 was $0.4 million, or $0.04 per diluted share, compared to $0.4 million, or $0.04 per diluted share, in the fourth quarter of fiscal 2021.

As of June 30, 2022 Electromed had $8.2 million in cash, $21.1 million in accounts receivable, no debt, for a working capital of $27.4 million, and shareholders’ equity of $34.2 million.

FY2022 Summary

For the fiscal year ended June 30, 2022, revenue grew 16.5% to $41.7 million, from $35.8 million in FY 2021, driven by a 15.2% increase in home care revenue, 7.2% increase in institutional revenue, and 161.8% increase in distributor revenue, which more than offset a 20.8% decline in international revenue. Gross margins were 75.5%, compared to 76.4% in the prior fiscal year, while net income was $2.3 million, or $0.26 per diluted share, compared to $2.4 million, or $0.27 per diluted share, in FY 2021. The Company’s cash decreased by $3.7 million, driven by $1.4 million of cash used to repurchase shares during the year as well as $1.5 million used in investing activities.

ShareRepurchase Program

In May 2021, Electromed’s Board of Directors approved a new $3.0 million share repurchase program. During the quarter, we also repurchased approximately 41,000 shares at a total cost of $0.5 million.

ConferenceCall

Interested parties may participate in the call by dialing (877) 407-0789 (Domestic) or (201) 689-8562 (International), and using pin number 13730926.

The live conference call webcast will be accessible in the Investor Relations section of Electromed’s web site and directly via the following link:

https://services.choruscall.com/mediaframe/webcast.html?webcastid=n0KYeYTK

For those who cannot listen to the live broadcast, a replay will be available by dialing (844) 512-2921 (Domestic) or (412) 317-6671 (International) and referencing the replay pin number 13730926. Additionally, an online replay will be available in the Investor Relations section of Electromed’s website at: http://investors.smartvest.com/.

AboutElectromed, Inc.

Electromed, Inc. manufactures, markets, and sells products that provide airway clearance therapy, including the SmartVest® Airway Clearance System, to patients with compromised pulmonary function. It is headquartered in New Prague, Minnesota, and was founded in 1992. Further information about Electromed can be found at www.smartvest.com.

CautionaryStatements

Certainstatements in this press release constitute forward-looking statements as defined in the U.S. Private Securities Litigation ReformAct of 1995. Forward-looking statements can generally be identified by words such as “anticipate,” “believe,”“estimate,” “expect,” “intend,” “may,” “plan” “potential,”“should,” “will,” and similar expressions, including the negative of these terms, but they are not theexclusive means of identifying such statements. Forward-looking statements cannot be guaranteed, and actual results may vary materiallydue to the uncertainties and risks, known or unknown associated with such statements. Examples of risks and uncertainties forthe Company include, but are not limited to, the duration, extent and severity of the Covid-19 pandemic, including its effectson our business, operations and employees as well as its impact on our customers and distribution channels and on economies andmarkets more generally; the competitive nature of our market; changes to Medicare, Medicaid, or private insurance reimbursementpolicies; changes to state and federal health care laws; changes affecting the medical device industry; our ability to developnew sales channels for our products such as the homecare distributor channel; our need to maintain regulatory compliance and togain future regulatory approvals and clearances; new drug or pharmaceutical discoveries; general economic and business conditions;our ability to renew our line of credit or obtain additional credit as necessary; our ability to protect and expand our intellectualproperty portfolio; the risks associated with expansion into international markets, as well as other factors we may describe fromtime to time in the Company’s reports filed with the Securities and Exchange Commission (including the Company’s mostrecent Annual Report on Form 10-K, as amended from time to time, and subsequent Quarterly Reports on Form 10-Q and Current Reportson Form 8-K). Investors should not consider any list of such factors to be an exhaustive statement of all of the risks, uncertaintiesor potentially inaccurate assumptions investors should take into account when making investment decisions. Shareholders and otherreaders should not place undue reliance on “forward-looking statements,” as such statements speak only as of the dateof this press release. We undertake no obligation to update them in light of new information or future events.

Contacts

Michelle Wirtz, Interim Chief Financial Officer

(952) 758-9299

investorrelations@electromed.com

Mike Cavanaugh, Investor Relations

ICR Westwicke

(617) 877-9641

mike.cavanaugh@westwicke.com

Source: Electromed, Inc.

FinancialTables Follow:

Electromed,Inc.

CondensedBalance Sheets

		June 30, 2021
Assets
Current Assets
Cash and cash equivalents	8,153,000	$	11,889,000
Accounts receivable (net of allowances for doubtful accounts of 45,000)	21,052,000		17,032,000
Contract assets	286,000		393,000
Inventories	3,178,000		2,114,000
Prepaid expenses and other current assets	1,870,000		276,000
Total current assets	34,539,000		31,704,000
Property and equipment, net	4,568,000		3,605,000
Finite-life intangible assets, net	599,000		663,000
Other assets	120,000		88,000
Deferred income taxes	1,538,000		1,049,000
Total assets	41,364,000	$	37,109,000
Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable	1,261,000	$	685,000
Accrued compensation	2,742,000		2,474,000
Income tax payable	51,000		288,000
Warranty reserve	1,256,000		940,000
Other accrued liabilities	1,840,000		252,000
Total current liabilities	7,150,000		4,639,000
Other long-term liabilities	41,000		54,000
Total liabilities	7,191,000		4,693,000
Commitments and Contingencies
Shareholders' Equity
Common stock, 0.01 par value per share, 13,000,000 shares authorized; 8,475,438 and 8,533,209<br> shares issued and outstanding, respectively	85,000		85,000
Additional paid-in capital	18,308,000		17,409,000
Retained earnings	15,780,000		14,922,000
Total shareholders’ equity	34,173,000		32,416,000
Total liabilities and shareholders’ equity	41,364,000	$	37,109,000

All values are in US Dollars.

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Electromed,Inc.

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CondensedStatements of Operations

	Three Months Ended<br> June 30					Twelve Months Ended<br> June 30
	2022		2021			2022		2021
	(Unaudited)		(Unaudited)
Net revenues	$	11,268,000	$	9,469,000		$	41,659,000	$	35,756,000
Cost of revenues		3,152,000		2,536,000			10,217,000		8,451,000
Gross profit		8,116,000		6,931,000			31,442,000		27,305,000
Operating expenses
Selling, general and administrative		7,309,000		5,953,000			27,114,000		22,443,000
Research and development		315,000		326,000			1,356,000		1,722,000
Total operating expenses		7,624,000		6,279,000			28,470,000		24,165,000
Operating income		492,000		652,000			2,972,000		3,140,000
Interest income (expense), net		5,000		(2,000	)		25,000		27,000
Net income before income taxes		497,000		650,000			2,997,000		3,167,000
Income tax expense		116,000		250,000			692,000		805,000
Net income	$	381,000	$	400,000		$	2,305,000	$	2,362,000
Income per share:
Basic	$	0.05	$	0.05		$	0.27	$	0.28
Diluted	$	0.04	$	0.04		$	0.26	$	0.27
Weighted-average common shares outstanding:
Basic		8,427,404		8,588,093			8,471,320		8,566,224
Diluted		8,735,154		8,897,595			8,768,703		8,911,842

Electromed,Inc.

CondensedStatements of Cash Flows

	For the Years Ended June 30,
	2022			2021
Cash Flows From Operating Activities
Net income	$	2,305,000		$	2,362,000
Adjustments to reconcile net income to net cash (used in) provided by operating<br> activities:
Depreciation		503,000			477,000
Amortization of finite-life intangible assets		125,000			133,000
Share-based compensation expense		976,000			1,024,000
Deferred income taxes		(489,000	)		(294,000	)
Changes in operating assets and liabilities:
Accounts receivable		(4,020,000	)		(4,091,000	)
Contract assets		107,000			510,000
Inventories		(1,072,000	)		971,000
Prepaid expenses and other current assets		(1,322,000	)		151,000
Income tax receivable		(237,000	)		550,000
Accounts payable and accrued liabilities		2,170,000			214,000
Accrued compensation		268,000			1,070,000
Net cash (used in) provided by operating<br> activities		(686,000	)		3,077,000
Cash Flows From Investing Activities
Investment in property and equipment		(1,425,000	)		(287,000	)
Investment in finite-life intangible assets		(100,000	)		(161,000	)
Net cash used in investing activities		(1,525,000	)		(448,000	)
Cash Flows From Financing Activities
Issuance of common stock upon exercise of options		-			46,000
Taxes paid on stock options exercised on a net basis		(77,000	)		(141,000	)
Repurchase of common stock		(1,448,000	)		(1,124,000	)
Net cash used in financing activities		(1,525,000	)		(1,219,000	)
Net (decrease) increase in cash		(3,736,000	)		1,410,000
Cash And Cash Equivalents
Beginning of period		11,889,000			10,479,000
End of period	$	8,153,000		$	11,889,000