Dynatronics Corporation (NASDAQ: DYNT) today announced results for its fiscal fourth quarter and year ended June 30, 2011.
Sales for the quarter ended June 30, 2011 increased 3 percent to $8,190,382, compared to $7,943,432 for the quarter ended June 30, 2010. Sales for the year ended June 30, 2011, were $32,692,859, down less than 1 percent from $32,962,392 for the prior year.
Net income for the quarter ended June 30, 2011 was $68,776 ($.01 per common share), compared to $70,955 ($.01 per common share) for the same quarter in the prior fiscal year. Net income for the year ended June 30, 2011 was $270,888 ($.02 per common share), compared to $423,977 ($.03 per common share) for the prior fiscal year. Approximately $469,000 in increased research and development expenses primarily accounts for the lower profitability in fiscal year 2011.
"Despite the fact R&D expenditures diminished our comparative profitability, such expenditures are important to enhancing future sales and maintaining our position as an innovator in the market," stated Kelvyn H. Cullimore Jr., chairman and president of Dynatronics. "In addition to our R&D initiative, we also made significant progress cultivating new sales opportunities with Group Purchasing Organizations (GPOs) and national accounts. During the year, we announced the signing of contracts with four GPOs: Premier, Amerinet, First Choice and Champs Group Purchasing. These contracts became effective in the latter part of the fiscal year and we have begun the process of introducing GPO member facilities to Dynatronics' brand of products."
"The contracts with the GPOs represent a license to solicit business directly from the members of the respective GPOs," explained Cullimore. "While initial indications of interest from these new GPO customers have been encouraging, we recognize that the process of converting business to our brand is more of a marathon than a sprint and it will take several quarters to show significant progress."
"Cultivating business through these GPO contracts and seeking additional contracts with other GPOs and national accounts is a major focus for us," stated Larry K. Beardall, executive vice-president of sales and marketing. "We have hired additional sales staff and continue to court several GPOs and national accounts throughout the country. It is gratifying to see GPO member clinics open accounts and place orders for our products and services."
The Company also experienced progress during fiscal year 2011 in the development of several new therapy devices which are targeted for introduction in the spring of 2012. "New products are an important element of our strategy to attract both new customers, including GPOs, as well as business from our existing customer base," added Cullimore. "We believe this new line of products will be attractive and provide a boost to our marketing and sales efforts immediately upon release."
"With potential new sales from GPO customers and national accounts as well as the expected impact from new products under development, we are optimistic about the potential for growth in sales and profits during the coming year," Cullimore concluded.