Q3 2020 InfuSystem Holdings Inc Earnings Call
Good morning, and welcome to the Infusystem Holdings, Corp. third quarter fiscal year 2020, <unk> financial results conference call all participants.
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Event is being recorded I would now like to turn the conference over to Joe Doormat, managing partner of with some partners. Please go ahead.
Thank you Greg Good morning, and thank you for joining us today to review the financial results of Infusystem Holdings Inc. for the third quarter of 2020 ended on September.
It's pretty 2020 <unk> with us today on the call are rich Diorio, President and Chief Executive Officer, and Barry Steele Chief Financial Officer. After the conclusion of today's prepared remarks, we'll open the call for a question and answer session. If anyone participating on today's call does not have a full text copy of the press release you can retrieve.
Treat it from the company's website at Www Dot Infusystem dot com or numerous other financial web sites before.
Before we begin with prepared remarks, I would like to remind everyone. Certain statements made by the management team of Infusystem. During this conference call constitute forward looking statements within the meaning of the private securities.
Third gains from Reform Act of 995.
Except for the statements of historical fact this conference call may contain forward looking statements that involve risks and uncertainties. Some of which are detailed under risk factors in documents filed by the company with the Securities and Exchange Commission, including the annual report on form 10-K for the year.
Let her ended December 31st 2019.
Forward looking statements speak only as of the date. The statements were made the company can give no assurance that such forward looking statements will prove to be correct. If you system does not undertake and specifically disclaims any obligation to update any forward looking statements whether as a result of new.
Year formation future events or otherwise now I'd like to turn the call to rich Diorio, President and Chief Executive Officer of Infusystem Rich.
Thanks, Joe and good morning, everybody and thanks for joining our call today I hope that you and your families remain safe and well as we continue to deal with the COVID-19 pandemic.
Today, we will cover our third quarter.
Results, our revised 2020 guidance and we will provide an update on our business as we move toward year end and prepare for 2021.
After our prepared remarks, we'll be happy to answer any questions you may have.
Now on to the results.
Our third quarter 2020 results demonstrated strong performance for our business once again.
New and as we continue to execute on our mission to facilitate patient care from the clinic to home.
Revenue in the quarter was $25.1 million, an increase of 16.9% compared to the third quarter of 2019, and we delivered $7.5 million in adjusted EBITDA of 46% increase over last year.
Operationally our focus remains.
As on growing the top line, while leveraging our cost infrastructure and during the third quarter, we generated $8.5 million of free cash Barry will provide more detail later and has your view on our liquidity and cash flow results.
As we saw in the second quarter, our core oncology business was not materially impacted by little bit 19 as volumes and revenue remained strong.
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As most of you know we provide the gold standard in service and safety to approximately 2100 oncology customers. In this critical mass provides important advantages that has enabled us to grow during these challenging times.
Three main elements are driving the growth of our oncology business first we are continuing to increase our market share by adding new clinics.
Second the number of treatments performed by providers also increasing and third the efficiency of our <unk> of our revenue cycle management continues to improve each quarter, resulting in a higher in a higher percentage of treatments that we provide delivering to the bottom line.
One of our major initiative. This year has been the rollout of our case management service, which improves the workflows.
Nixon also positions us to better manage the billing and paperwork to process claims to date, we have about 500 of our oncology customers live on this program and these process improvements continue to have a positive impact on both our top and bottom lines.
While the onetime $1.5 million pump sale that we booked during the second quarter did not repeat in the third quarter the.
Do you have any segment grew by over 18% due in part to a high number rental pumps in the field servicing the ongoing cobot crisis most of the pumps that we deploy during the pandemic surge remain in the field in rental revenues continued to be strong. It's also worth noting that through a new agreement with Cardinal we have added their enteral pumps to our fleet they have been deployed to customer.
Summers and are already generating rental revenue that we will we believe will continue post cobot.
Given the recent resurgence of the pandemic. We expect this trend to continue for the next few months importantly, the significant deployment of our pumps in the field. During Cogut has resulted in new customers for our business and post Kogut. We believe that we have an opportunity to retain many of these new cost.
Mers and grow our business with them our.
Howard fusion pump business and the strength of our core oncology services have effectively hedged our business during cobot and why we are making progress with our new therapies pain management in negative pressure. The pandemic has continued to slow our ability to gain traction as quickly as we would have liked with these therapies. Nevertheless, our pain management segment to.
Justin good signs of recovery and growth with revenues increasing sequentially from the second quarter as elective surgeries have begun to come back online in fact in September we shipped more pumps for upcoming surgeries than in any other month prior since the inception of the program through October we have shipped approximately 30% more devices for patients than we did for the same period last.
Last year, while the pandemic is on the rise again hospitals and clinics have communicated to us that they have learned to better manage their cobot cases and that they expect to continue performing elective surgeries by retaining as much capacity as possible for the procedures.
We continue to make progress in bringing on new surgery centers as we plan to replicate the leadership position.
Mission that we have established in our oncology business as.
As we drive higher adoption of our pain management service. Our sales team continues to hear the more physician see value in doing their part to address the opioid crisis by changing their practices to avoid the use of oral pain medications.
Given the positive momentum and adding surgery centers and the recovery in revenue that we saw from the second.
Quarter, we remain optimistic in the growth of this business going forward.
We are confident in our plan to double our pain management revenue next year and again in 2022.
Our partnership with Cardinal Health and negative pressure wound therapy also offers significant opportunity for growth in the future. We're still navigating through obstacles goes by cold it actually.
Access to hospitals and clinics has improved from the spring, but it's still not where we want it to be.
We continue to be enthusiastic about this therapy, given the 600 million dollar addressable market opportunity with our goal of gaining 5% to 10% market share.
As mentioned last quarter reimbursement is higher than we initially anticipated in certain cases, and the pent up demand.
This therapy is building as our sales team increases activity in fills the sales pipeline, while the resurgence in the pandemic make continued to delay meaningful volume gains for a few more months. These factors indicate that wants to covert becomes more controlled this business has potential gross to grow can significantly contribute to our revenue beginning.
In 2021.
And with that I'd like to turn it over to our CFO Barry Steele to provide a few a review of our third quarter financial results.
Thank you rich and thank you everyone for joining the call today.
As rich mentioned during the quarter, we overachieved, our revenue and profitability expectations, all becoming cash flow path.
Positive and reducing balance sheet leverage.
Net revenues for the current year third quarter and $25 million represented an increase of $3.6 million or 17% over the prior year third quarter.
Hi Tech segment, net revenue growth of $2.2 million or 16% outpaced the net revenue growth of the smaller DMV services segment.
Which increased by $1.5 million. However, the DNA services team was not to be completely done by the ITC segment. As this represented an 18% increase from the prior year third quarter.
I'd had growth continued to be driven by favorable market penetration in the oncology business, resulting from an improved competitive landscape.
Pain management net revenues, which are part of the IPO segment continued to recover during the quarter from the COVID-19 shutdowns nearly doubling on a sequential basis from the 2022nd quarter and staying in pace with an increasingly tougher comparison to the prior year.
The DMV services segment net revenue growth was led by increased rental revenue.
Q, which increased by $1.1 million.
I'm going to be any services segment growth was the result of the Carbonite team driven increase in market demand, which may which may moderate when the pandemic reside however, a greater portion of the growth was represented by an expansion in market share with National home infusion service providers and the addition of new devices to our.
Product portfolio stemming from new partnerships and device manufacturers.
The higher revenues translated into both higher adjusted EBITDA, which increased by nearly two and a half million or 46% to $7.5 million during the quarter and improved adjusted EBITDA margin, which grew to 30% during the current.
Quarter compared to 24% in the prior year once again, demonstrating the company's ability to convert net revenue growth to improved earnings the.
The improvements were driven by both an improved margin mix and fixed selling general and administrative cost coverage.
During the 2020.
Third quarter operating cash flow.
<unk> totaled $8.4 million, which nearly doubled operating cash flow during the first two quarters of this year on a combined basis.
The amount was also 61% higher than the operating cash flow from the prior year third quarter of $5.2 million.
The improvement was due to both much higher net income adjusted for non cash items and due to.
Reduction in working capital.
Lower working capital was mainly due to the return of normal levels. After having increased in the first half of the year as we prepared for the effects of Cove in 19.
You may recall that due to our coated covenant EBITDA preparations, we accelerated our purchases of medical.
Cool devices into the first half of the year.
Because of this net capital expenditures expenditures totaled only half a million dollars for the 2023rd quarter, which was much less than either the prior year amount of $7.6 million or that of this year's first and second quarters, which totaled $4 million and 4.5.
Marianne respectively.
This reduction along with higher operating cash flow allowed us to repay 100% of our outstanding revolving line of credit borrowings increased our cash on hand.
The combined net improvement of $5.8 million, while also making $1.7 million in regularly scheduled amortization payments due under.
For our term debt facilities.
As a result, our ratio of funded debt to adjusted EBITDA as of September Thirtyth 2020 decreased to 3.6 starts 1.3 times 1.36 times down from 1.77 times as of June Thirtyth 2020.
And down from 2.11 times at the end of 2019.
Our total available liquidity at the end of the quarter, which totaled $17.5 million consisted of $9.8 million in availability on our revolving line of credit 5.7 million available under an open capital expenditures facility and nearly 2 million.
And Kash CMO.
The amount represented an increase from our available liquidity of $11.7 million at the end of this year second quarter, but down from 20.9 million as of December 30, Onest 2018.
We estimate that our liquidity position will continue to improve in the fourth quarter of this year as our working capital position.
Ian continues to level off and operating cash flows continue to outpace our capital expenditures as we round out the year.
With that I'll turn it back over to rich.
Thanks Barry.
We're very pleased with our third quarter and year to date performance and the continued strong momentum as we begin the fourth quarter our core business continues.
Cornwell with approximately 16% revenue growth this year, not including the $2.32 million to $3 million Tailwinds, We opened 19.
And that even after the impact of Covance has had on slowing the growth of our pain management in wound care sales with continued growth of our core oncology business rental revenues from our infusion pump fleet remaining strong.
The progress we are making in pain management wound care therapy segments, we are increasing our 2020 financial guidance range. Despite tightening our revenue expert expectation towards the high end of prior guidance and raising our expectations on adjusted EBITDA and operating cash flow, our new financial targets for 2020 are as follows.
Revenue for the year.
Here is now anticipated to be in the range of $96 million to $97 million compared the prior range of 94 to 97 million.
Adjusted EBITDA is now expected to be in the range of $26 million to $27 million up.
From 23% to 26.
And our anticipated operating cash flow for 2020.
It is now.
Now to be expected to be in the range of $18 million to $19 million up from $16 million to $18 million range.
Infusystem has turned the corner and we believe that our trajectory as we exit this year is a good indicator of our expected performance in 2021.
Early indications are for another solid year with double digit growth from variety.
I'd of revenue sources and this does not factor in any significant COVID-19 related infusion pump revenue like we had in 2020.
Our capital allocation strategy will be key to growing our platforms and unlocking the opportunities that we have to expand our business and create additional shareholder value.
Infusystem is uniquely positioned for these opportunities and I'm very excited.
As to the future of the company.
And with that I'm happy to answer any questions.
We will now begin the question and answer session half of your question you May Press Star then one on your Touchtone phone, if you're using a speakerphone. Please pick up your handset before pressing the keys.
Charles.
Your question. Please press Star then too.
At this time, we will pause momentarily to assemble our roster.
Our first question today will come from Brooks O'neil with Lake Street Capital markets. Please go ahead.
Good morning, guys.
Terrific quarter.
I appreciate the signal.
Significant positive drivers in the business and I also appreciate the obvious concerns related to the uncertainty of coal bed and.
People's response to it.
It looks to me like there is some.
On the implied conservatism in Q4.
Guidance or you know the implied guidance and I'm just curious if you could just sort of walk through where you are most concerned.
As we look for.
Forward to the end of the year.
I don't think we're overly concerned with the Alaska.
Six or seven weeks of the year.
Cove It has bounced back pretty significantly in the last couple of weeks. So the impact on pain management is still a little bit to be determined but.
But we do know that that a lot of hospitals and clinics have told us that even if elective surgeries come offline it won't be to the extent.
So if they were in the spring and early summer.
Access to hospitals in negative pressure, so a little bit slow, but our core oncology business is still strong DMV revenue still strong.
I don't think it's overly conservative but.
So I don't think Theres any anything major that we see in the next six or seven weeks that could derail us.
Either.
Great that's fantastic.
Were you surprised that negative pressure is now out of the competitive bidding in and do you think thats, a meaningful positive or just sort of an ongoing.
During a state of the negative pressure business.
Yes, so I wouldn't necessarily say, we were surprised by it.
I think overall, it's a positive for anyone in that in that market because theres as of now there is no reduction reimbursement.
So thats, obviously, a positive and in the <unk> and if they go back to another round of competitive bidding it will be a while so we have some runway here for a while.
Without worrying about our reimbursement levels, which will instead, we can worry about going and going and winning some market share. Instead. So overall, it's a it's a it's a plus we didn't get any caught and we'd have to worry about winning it or anything like that so totally complete positive for everybody in the market.
Yes, that's great. So.
It sounds like the relationship with Cardinal continues to progress well.
The the opportunity with the enteral pump sounds good could you just comment on that and then talk a little bit about whether we should expect to see any additional new product platforms.
2021 or are you going to be focused.
On.
Building out the negative pressure and pain businesses, primarily.
Yes, so the relationship with Cardinal has been great they've been a fantastic partner on the negative pressure side and.
The.
The enteral pump.
Relationship started.
Sometime late in the second quarter into the third quarter.
We were able to help them out in some accounts that they were they needed some help with them. So thats thats grown which is great.
As far as new therapies. My expectation is we'll have another one next year, we would have been a guaranteed probably this year without covance.
We will still roll one out even with the focus on negative pressure and pain, but those two therapies piano negative pressure I'm going to be a huge part of our growth for next year. So that so that will be the focus of the team for sure, but rolling out a new therapy will make sure we do it at the right time, and we don't distract the team and.
Make sure that.
We're able to execute on not only the new therapy, but existing ones as well.
Great and then I just have one more in I appreciate Barry's comment that the capital position, but as you look forward to 2021 and the growth opportunities you have you feel pretty good about your available capital.
Yes, I think I think we feel good about our available capital as well as our ability to to raise more if we need it I don't think that were needed in a very short term, but we're feeling pretty good right now but definitely.
I will turn the turn the corner on bill and generate cash.
Yes, Thats fantastic. Thanks, a lot for taking my questions.
Thanks Brooks.
Our next question will come from Alex Miller with Craig Hallum Capital.
Scott.
All right Greg Good morning, everyone.
Kind of going off of Brooks comments on the negative pressure wound business I know, it's early but can you just give a few case examples of that business with Cardinal you know were in which facilities are.
Are you seeing the early success and how was a how do they wound facility handling their their therapy before you and now after when you and Cardinal came in what is their wound care business starting to look like in that practice.
So.
All the business is coming out of acute care hospitals.
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Most of the wins if not all are from the competition.
So where we're winning market share from from existing competition in the market I think you know.
We have a lot of relationships in hospitals with our with our oncology business. It's it's been around for 30 years and obviously Cardinal is extremely strong in the acute care.
Market. So between the two of US we have a lot of relationships in hospitals that we can walk into and start the discussion. So that's really where it's come from where it started we didn't have to.
Plant any new seeds or anything it was customers. We already knew that have used one of us and are happy with the service.
So now they are used in a lot of cases cardinal for their inpatient.
And and Infusystem for their outpatient wound therapy.
No thats, great and then on the on the oncology business.
What do you think about the growth there I mean, obviously, you're you're pegging the growth for next year more more on the pain and the negative press, one therapy, which makes sense just given your market share already and oncologist.
But is there still share to be taken there and you also mentioned you are seeing more prescriptions per clinic. So are there any new drugs or other indication expansions coming along for other cancers that we should be watching for.
Yes, So let me let me take the second one first so from a new indication standpoint, there is nothing that we see that's dramatic.
As the market in the pipeline anywhere. So there are a lot of smaller kind of orphan drugs that are delivered via continuous infusion. We've had a pickup of those over the last couple of years Janssen came out with the drug and I'm drawing a blank on the other company, but there has been a couple of drugs and because we're already we already kind of own that market, it's an easy transition for the customer.
You just continue to use our pumps for more more indication so as those roll out that will certainly help.
The.
I'm sorry, what was the first part of the question I'm drawing a blank on the first part it was about taking share the potential there.
Oh.
Oh and oncology so.
On colleges oncology is going to grow mid single digits, 567% for a long time, it's not going to be the 20%. We saw when our competitor exited the market, we're effectively get out of the market.
But it's going to be a solid growth driver for us it throws off a lot of cash to fund new therapies and our investments.
And it will continue to grow just it just at a steady consistent pace.
Probably mid single digits, the real growth is going to come from the new therapies and for 2021, specifically it will be negative pressure and pain for sure you. If we add a new therapy next year just.
The time it takes to roll it out in launching and get customers onboard.
We'll take allows the 2021 revenue is going to come for pain and they get a pressure for that for the most part.
Okay that makes sense and.
Going back to the pain business, and well and one third of the wound therapy of Cardinal which is certainly helping out it sounds like in the pain, you're doing this obvious yourself so maybe.
Maybe speak to what needs to.
To be done from either an investment standpoint or is this just a pure blocking and tackling efforts to double the business. The next couple of years and pain.
Yes, so so it's a little bit of both I think the service is really well established the team has done a great job building a model that that is super competitive in the market. We're.
We're making a small investor.
In an additional sales rep, but.
But thats really it for investments and then a couple on the backend side to support the team.
But it is a lot of blocking and tackling we would have had pain would have had a phenomenal year. This year if it wasn't for it.
The elective surgeries coming offline in the second quarter.
That's out of our control and we'll just kind of roll with it so.
So what we would have expected this year, we expect to see in 2021.
Even with the cobot rebound.
Hospitals have have stocked up on pp in east they don't have to pull it from other spots specifically the ours.
They don't have to pull their team away necessarily so.
Even if it gets affected it's not going to be what it was before I mean.
I think everybody in this in the elective surgery world, probably saw an 80% decline if not more in their in patient cases, we.
We don't expect to see anything near that in the future and we haven't seen it so.
Overall, we think we are going to be we're going to be in a lot better off position, even if coal that sticks around which although it looks like it's here to stay.
Like there is some good news on the horizon to as far as vaccine. So.
Next year I expect great things from those team that team I think they are ready to do it ready to execute and it will be fun to Washington here.
Thats, Great and then just two quick questions for Barry the first one looks like better asked unit control in the quarter is if there is anything to call out there and then SEC.
Looking it was mentioned in the prepared remarks about better collections with your oncology customers that are on this case management service platform, maybe any metrics about what sort of better reimbursement level or better ASP, you're getting from those customers versus those who are on that service.
Yeah. So.
Back on the first question.
Well I think let me take the second one first.
And the reimbursement world, we're seeing better ability to get our.
Actually harvest collections are from existing.
Treatments so.
We have.
Our.
No.
Collect every single treatment and we are doing better and better with our improvements in the revenue cycle process to get to get more that's hard to really say a specific amount, but it's hundreds of thousands of dollars that were seeing as an opportunity and we're starting to get some of that.
On SGN, a you did see in the quarter, a little bit higher spend just mostly related to just adjusting our shorten.
Ill from comp programs.
We also saw on the opposite side of benefit from decreased bad debt adjustments that we had in the quarter.
But do you feel pretty good about the yesterday level kind of on a go forward basis, maybe some small increases but nothing too drastic.
Yes, they are I think the Ed.
As we as we grow this company.
From the.
A 100 million range to something much much more we see as a possibility there will be some investments, meaning we need to make but there's also has a higher scale. Some leverage I think we can get not only in just our existing infrastructure already in place, but improving processes.
Processes, so that we can take out cost and and just more of.
Onto scaling a benefit.
Okay got it thank you very helpful.
Thanks, Alex.
Again, if youd like to ask a question. It is star then one Star then one ask your question.
Our next question will come from Douglas Weiss with DSW.
Investment. Please go ahead.
Hey, good morning.
I wanted to just.
Such this quickly on that.
Which was really low.
And I guess, you sort of alluded to it nonetheless answer but could you just talk a little more generally.
Yes.
Whether the current quarter, it which is basically zero is.
And one off.
And also just in general what that debt has come down so much over the last couple of years.
Thanks.
Okay.
I didn't quite get the question is that what's which met.
We're talking about.
The allowances the bad debt customer allowances.
Yes, it's in the mineral significant issue for US we did see some degradation in some of our.
Agings and part of the business on.
Early in the year and that sort of reversed and then we had on any side a little bit little.
The degradation in our agings, we don't view it as necessarily things that can't recover from but our accounting policies dictate that we make put reserves in place. So again. The first couple of quarters, we had a little higher levels, but compared to really tough comps in the prior here because.
There was some reversals and then we had a parcel.
Reversal on one of our revenue streams in the third quarter, but still elevated level and the other part of the business. So I think that as we go through time. It will continue to be very small ratio to our overall revenue.
Mhm.
I mean, I guess, because if I look back to like 2017 that was actually a pretty large line item I believe in 2017.
It was $5.6 million.
Yes, it was.
And I know you shifted to more.
Larger percent of your sales are now direct to hospitals, which I assume is low.
Defaults, but I think you're correct.
I think you're looking at the accounting change where an under revenue recognition rules the Dol.
Books things like this.
Same way there things are put netted in revenue now that that were not before.
Okay. Okay.
Question.
And then looking at 2021.
In terms of what.
The right base would be to use and maybe.
Maybe maybe on the quarter too early but I.
I know you had a couple.
Hello.
One time events this year.
I mean.
When when you say when I sort of think about growth in 2021 should I.
Shave a couple of million off the starting point.
For one time coven effects.
Yeah. So so.
What you saw on that and.
And the guidance for 2020 as a two to 3 million dollar number which would actually it's pretty similar number on the top line as well as the EBITDA line because were 11.
And we had a onetime sale in Q2 that was.
Equipment that we already had amortized or depreciated almost fully we had some cost to make a patient ready. So that's one that won't necessarily.
So the rate of return.
That said, we see elevated levels in rentals and things that probably are will repeat somewhat in 2021. So I think that when we had to step back we'll see that one onetime sale in Q2 as really being a tough comp everything else probably as we compare 2021 to 2020.
It will be more or less breakeven to those those effects will be equally in each year more or less.
Mhm.
Okay.
So basically it is it is a reasonable base to start with.
Maybe a million.
Yes, I think that's where I think that you know as you look at growth for next year ill.
All end up being now acts huge consequence to us that there is a little bit of headwind, obviously, especially in Q2, but it won't be a huge cuts.
Mhm Okay.
On the enteral pumps.
Is that a potentially larger business or is that just sort of a one off.
So.
No.
We we have other manufacturers enteral pumps and it's a it's a it's a significant number from a rental revenue standpoint are ready.
The relationship with Cardinal is new we didnt have their devices before.
It's it's potentially a big amount I mean, it's not massive now, but it's certainly contributing to the numbers.
So it's it's something that when.
Anytime you can add a new device from a manufacturer or a company like Cardinal it's always a benefit so we expect it to grow overtime for sure I think right. Now there were there were some pumps needed and feel that we sent out.
But overtime, we expect that relationship specifically on the enteral pump side to bear more fruit for us.
Okay.
And then how about your expectation for Capex for the fourth quarter.
Yeah, you'll see it you'll see it back a little higher than what we saw here in Q3 as as I mentioned, we accelerated a lot into the first four months of the year actually again for.
For lesser pump recovered pace.
Patients some personal as our business growth that we that we have so it'll be a back a bit higher but not and it will end the year in that 15, maybe a little higher range. So clearly.
We generated cash in the fourth quarter.
Okay, alright, thanks, Thats, all I got thanks, good quarter.
Thanks, Doug.
Our next question will come from and more work with U.S. capital. Please.
Please go ahead.
Hey, guys. Good morning, I had you're doing well.
Huh.
I looked to me like one of the most impressive things about your quarter was the $8 million plus in.
Operating cash flow and then it looks like you.
7.5 million of that you paid down about 20% of your debt or is.
Is that correct and then or what should we expect going forward in terms of that cash flow number.
So yeah that you're exactly right. We we have revolving borrowings that were able to pay back then we had to build a little catch up as well.
Well, because we have some term debt out there as well.
We need as we look at next year and well, obviously, we have more coming to give you. Some guidance here. We we suspect that will continue to generate cash not quite as much as here in the third quarter because that's more.
Our cash generation for the current year sort of piled up in the third quarter because of the XR.
Patient into the first half of the year of working capital growth and capitals managers, but we think that will still be cash flow positive next.
Next year as well.
I guess the way their I'm reading it is Uh huh.
If you guys weren't choosing to grow which obviously is a smart strategy at this point.
You'd be throwing off a lot of cash I mean, that's that's kind of what's coming out of this quarter to me is that.
Good way to look at it you think.
Yeah, So I think what I would.
Good so I think when you when we have times of growth, but the cash will slow down a little bit times, whether or not you know.
Buying a bunch of pumps and so.
Supplies, you'll see a stir up a lot of cash in and that will ebb and flow you know year to year and even within the year like we did this year.
Right right. Okay. Thank you.
Can you tell me I don't remember what is the current run rate on the pain management business.
For revenue.
So we don't we don't break.
It is part of the I can't segment with negative pressure in oncology, but right now it's in the single digit millions and.
And that's where we expect it to double and then double again, so it will be double digit millions here and in the next couple of years.
Okay, Yes, that's kind of what I was trying to get at is figuring out. So when you say double next year I, just got a number I mean I've no.
Yes, Theres 5 million now this year you'd expect 10 million next year, and then $20 million a year. After that is that what you're saying or are you, saying like.
5 million extra next year, and then 5 million after that again the next year I'm, just trying to figure out that.
Yeah. So it's it's the first guy Baber scenario, yes, the personnel to double that's.
What I sell them then double yeah, yeah, okay, Okay, and then so.
On the negative pressure wound therapy over the next three to five years, if I'm reading your guidance right. It looks like you expect it to get 30 to 60 million of that is that.
Reading that correct as well.
Yeah. So that's a five to 10.
10% of the big addressable market of 600 million okay.
As long as we work to execute yeah as long as we can execute and customer adoption has what we think it can be done that's that's what we're shooting for.
Great. Thank you guys appreciate it.
Uh huh.
This will conclude.
Clearly our question and answer session I would like to turn the conference back them to rich diorio for any closing remarks.
Thank you all for participating on today's call and for your interest in Infusystem, We look forward to sharing our progress on our next quarterly conference call. When we report our fourth quarter results in early 2021, thanks and have a great day.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
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