Pro-Dex, Inc. Announces Fiscal 2025 Second Quarter and Six-Month Results

Rhea-AI Summary

Pro-Dex (PDEX) reported strong financial results for Q2 FY2025. Net sales increased 33% to $16.8 million, driven by $3.1 million in shipments of next-generation orthopedic handpieces and $1.6 million increase in repair revenue from their largest customer.

Gross profit rose 81% to $5.1 million, with gross margin improving by 8 percentage points to 30%. Operating income surged 247% to $2.7 million, while net income reached $2.0 million ($0.61 per diluted share), up from $500,000 ($0.14 per diluted share) in Q2 FY2024.

For the six-month period, net sales grew 29% to $31.7 million, with net income of $4.5 million ($1.33 per diluted share), compared to a net loss of $115,000 in the prior year period. The company expects continued revenue growth in Q3 and Q4 due to ongoing production shipments of the next-generation handpiece.

Positive

• Net sales increased 33% YoY to $16.8M in Q2 FY2025
• Gross margin improved by 8 percentage points to 30%
• Operating income grew 247% to $2.7M
• Net income per diluted share increased to $0.61 from $0.14 YoY
• Six-month net sales up 29% to $31.7M
• Strong backlog indicating future growth potential

Negative

• Operating expenses increased 18% to $2.4M due to higher personnel costs
• Heavy reliance on largest customer for revenue growth
• Volatile valuation of marketable equity investments affecting net income

IRVINE, CA / ACCESS Newswire / January 30, 2025 / PRO-DEX, INC. (NasdaqCM:PDEX) today announced financial results for its fiscal 2025 second quarter ended December 31, 2024. The Company also filed its Quarterly Report on Form 10-Q for the second quarter of fiscal year 2025 with the Securities and Exchange Commission today.

Quarter Ended December 31, 2024

Net sales for the three months ended December 31, 2024, increased $4.2 million, or 33%, to $16.8 million from $12.6 million for the three months ended December 31, 2023, primarily due to the shipment of $3.1 million of our largest customer's next generation orthopedic handpiece as well as an increase in repair revenue of $1.6 million similarly generated from our largest customer. As previously disclosed, we supported our largest customer's limited market release quantities of their next generation end effector last fiscal quarter and this quarter we began production shipments. We anticipate that the third and fourth quarters will reflect increases in revenue compared to the corresponding periods of the prior year due to the continued production shipments of this next generation handpiece.

Gross profit for the three months ended December 31, 2024, increased $2.3 million, or 81%, to $5.1 million from $2.8 million for the same period in fiscal 2024. Gross margin increased by 8 percentage points to 30% for the three months ended December 31, 2024, compared to 22% for the corresponding period of the prior fiscal year. The improvement in gross margin is primarily due to increased sales and favorable product mix.

Operating expenses (which include selling, general and administrative, and research and development expenses) for the quarter ended December 31, 2024, increased $355,000, or 18%, to $2.4 million compared to $2.0 million in the prior fiscal year's corresponding quarter, reflecting increases in both research and development costs as well as general and administrative expenses mostly due to higher personnel related expenses.

Operating income for the quarter ended December 31, 2024, increased $1.9 million, or 247%, to $2.7 million compared to $777,000 for the prior fiscal year's corresponding quarter. The increase is attributable to higher sales and improved gross margins.

Net income for the quarter ended December 31, 2024, was $2.0 million or $0.61 per diluted share, compared to $500,000, or $0.14 per diluted share, for the corresponding quarter in fiscal 2024.

Six Months Ended December 31, 2024

Net sales for the six months ended December 31, 2024, increased $7.2 million, or 29%, to $31.7 million from $24.5 million for the six months ended December 31, 2023, due primarily to $4.7 million in shipments of the newest generation handpiece we sell our largest customer as well as $2.7 million in increased repair revenue from the orthopedic surgical handpiece that we sell to our largest customer.

Gross profit for the six months ended December 31, 2024,increased $3.8 million, or 58%, compared to the same period in fiscal 2024 due to increased sales and favorable product mix. Our gross margin increased by 6 percentage points to 32% for the six months ended December 31, 2024, compared to 26% for the corresponding period of the prior fiscal year.

Operating expenses (which include selling, general and administrative, and research and development expenses) for the six months ended December 31, 2024, increased $666,000, or 17%, to $4.5 million compared to $3.9 million in the prior fiscal year's corresponding period. The increase is related to increased research and development costs and general and administrative expenses mostly due to higher personnel related expenses.

Operating income for six months ended December 31, 2024, increased $3.1 million, or 119%, to $5.7 million compared to $2.6 million for the corresponding period of the prior fiscal year. The increase in operating income is attributable to higher sales and gross profit offset by the higher operating expenses described above.

Net income for the six months ended December 31, 2024, was $4.5 million or $1.33 per diluted share, compared to a net loss of $115,000, or $0.03 per diluted share for the six months ended December 31, 2023. Our net income for the six months ended December 31, 2024, contains unrealized gains on our marketable equity investments of $510,000 and our net loss for the six months ended December 31, 2023, contained unrealized losses on our marketable equity investments of $2.6 million. All of our investments are recorded at estimated fair value, and the valuation can be highly volatile.

CEO Comments

"We are pleased with our second quarter and year-to-date results." said Richard L. ("Rick") Van Kirk, the Company's President and Chief Executive Officer. "We are ramping up our staff to meet the commitments of our increased backlog." Mr. Van Kirk continued, "We are excited about our continued sales growth and looking forward to the challenges ahead."

About Pro-Dex, Inc.:

Pro-Dex, Inc. specializes in the design, development, and manufacture of autoclavable, battery-powered and electric, multi-function surgical drivers and shavers used primarily in the orthopedic, thoracic, and maxocranial facial markets. We have patented adoptive torque-limiting software and proprietary sealing solutions which appeal to our customers, primarily medical device distributors. Pro-Dex, Inc. also sells rotary air motors to a wide range of industries. Pro-Dex's products are found in hospitals and medical engineering labs around the world. For more information, visit the Company's website at www.pro-dex.com.

Statements herein concerning the Company's plans, growth, and strategies may include 'forward-looking statements' within the context of the federal securities laws. Statements regarding the Company's future events, developments, and future performance, as well as management's expectations, beliefs, plans, estimates, or projections relating to the future, are forward-looking statements within the meaning of these laws. The Company's actual results may differ materially from those suggested as a result of various factors. Interested parties should refer to the disclosure concerning the operational and business concerns of the Company set forth in the Company's filings with the Securities and Exchange Commission.

(tables follow)

PRO-DEX, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except share amounts)

		December 31, 2024				June 30, 2024
ASSETS
Current assets:
Cash and cash equivalent		$	66			$	2,631
Investments			4,671				4,217
Accounts receivable, net of allowance for expected credit losses of $27 and $0 at December 31, 2024 and at June 30, 2024, respectively			18,467				13,887
Deferred costs			152				262
Inventory			19,611				15,269
Prepaid expenses and other current assets			1,333				345
Total current assets			44,300				36,611
Land and building, net			6,108				6,155
Equipment and leasehold improvements, net			5,443				5,024
Right-of-use asset, net			1,265				1,473
Intangibles, net			40				54
Deferred income taxes, net			1,555				1,555
Investments			1,619				1,563
Other assets			44				42
Total assets		$	60,374			$	52,477
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	5,689			$	4,513
Accrued liabilities			5,234				3,359
Income taxes payable			303				632
Deferred revenue			-				14
Notes payable			5,913				4,374
Total current liabilities			17,139				12,892
Lease liability, net of current portion			939				1,182
Notes payable, net of current portion			10,474				7,536
Total non-current liabilities			11,413				8,718
Total liabilities			28,552				21,610
Shareholders' equity:
Common stock; no par value; 50,000,000 shares authorized; 3,260,390 and 3,363,412 shares issued and outstanding at December 31, 2024 and June 30, 2024, respectively			366				3,917
Retained earnings			31,456				26,950
Total shareholders' equity			31,822				30,867
Total liabilities and shareholders' equity		$	60,374			$	52,477

PRO-DEX, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except share and per share amounts)

		Three Months Ended December 31,								Six Months Ended December 31,
		2024				2023				2024				2023
Net sales		$	16,793			$	12,588			$	31,686			$	24,526
Cost of sales			11,721				9,786				21,464				18,066
Gross profit			5,072				2,802				10,222				6,460
Operating expenses: Selling expenses			49				37				98				63
General and administrative expenses			1,389				1,200				2,635				2,195
Research and development costs			942				788				1,784				1,593
Total operating expenses			2,380				2,025				4,517				3,851
Operating income			2,692				777				5,705				2,609
Interest expense			(204	)			(139	)			(357	)			(271	)
Unrealized gain (loss) on marketable equity investments			77				(40	)			510				(2,593	)
Interest and other income			21				22				46				46
Income (loss) before income taxes			2,586				620				5,904				(209	)
Income tax benefit (expense)			(546	)			(120	)			(1,398	)			94
Net income (loss)		$	2,040			$	500			$	4,506			$	(115	)
Basic net income (loss) per share:
Net income (loss) per share		$	0.63			$	0.14			$	1.36			$	(0.03	)
Diluted net income (loss) per share:
Net income (loss) per share		$	0.61			$	0.14			$	1.33			$	(0.03	)
Weighted-average common shares outstanding:
Basic			3,261,145				3,546,901				3,314,207				3,546,819
Diluted			3,337,337				3,611,701				3,378,862				3,546,819
Common shares outstanding			3,260,390				3,541,045				3,260,390				3,541,045

CONTACT:

Richard L. Van Kirk,
Chief Executive Officer
(949) 769-3200

SOURCE: Pro-Dex, Inc.

View the original press release on ACCESS Newswire

FAQ

What was Pro-Dex (PDEX) Q2 2025 revenue growth?

Pro-Dex reported Q2 FY2025 revenue growth of 33%, with net sales increasing to $16.8 million from $12.6 million in Q2 FY2024.

How much did PDEX earnings per share increase in Q2 2025?

PDEX earnings per diluted share increased to $0.61 in Q2 FY2025, up from $0.14 in Q2 FY2024.

What drove Pro-Dex (PDEX) revenue growth in Q2 2025?

The revenue growth was primarily driven by $3.1 million in shipments of next-generation orthopedic handpieces and a $1.6 million increase in repair revenue from their largest customer.

What was PDEX's gross margin improvement in Q2 2025?

PDEX's gross margin improved by 8 percentage points to 30% in Q2 FY2025, compared to 22% in Q2 FY2024.

What is Pro-Dex (PDEX) six-month performance for FY2025?

For the first six months of FY2025, PDEX reported net sales of $31.7 million (up 29%) and net income of $4.5 million ($1.33 per diluted share), compared to a net loss in the prior year period.