Utah’s Dynatronics bounces back in 2009

Dynatronics Corp. saw a turnaround in its financial performance during its 2009 fiscal year.

The Cottonwood Heights-based company, which manufactures and sells equipment used by physical therapists and sports medicine practitioners, recorded net income of $103,324 for the fiscal year that ended on June 30. Sales for the year were $32.4 million.

A year ago, Dynatronics reported 2008 sales of $32.6 million and a loss of $8.4 million — a loss that in large part was the result of the company writing down about $6.6 million in goodwill.

“We saw some significant improvement in our bottom line results in 2009, which was particularly heartening given the deterioration in the national economy,” said spokesman Bob Cardon.

For its fourth quarter, Dynatronics reported its net income was $46,101, compared to a loss of $6.8 million, or 62 cents per share, for the same quarter a year earlier. Sales for the fourth quarter of 2009 were $8 million, practically unchanged from fourth quarter sales in 2008.

In a statement announcing the company’s 2009 financial results, Dynatronics President Kelvyn H. Cullimore Jr. said that over the past two years the company launched aggressive cost-reduction campaigns to improve its operating efficiencies.

“Those efforts have led to sustainable earnings improvement, which we believe will benefit the company for many years,” he said.

Cullimore also noted that over the past year the company

expanded its direct sales team to 50 representatives, a figure that included 27 direct sales employees and 23 independent sales personnel.

“By continuing to build our sales force, streamlining operations through e-commerce and capitalizing on evolving market opportunities, we believe we’re well-positioned for continued improvements, particularly as general economic conditions improve,” Cullimore said.

Early last week, Dynatronics also announced it had signed a “preferred vendor agreement” to provide physical therapy equipment and medical supplies to the Salt Lake City-based Western Rehabilitation Health Network, which comprises 114 independently owned clinics in Utah, Idaho and Colorado. And that means the owners of those clinics will be using Dynatronics to purchase their supplies and can anticipate deep price discounts because of their combined purchasing power, said Rhonda Noble, executive director of Western Rehabilitation Health Network.

“The cool thing about Dynatronics is that they are a local [Utah] company that is known for being very responsive to their customers,” she said.

The preferred vendor agreement may generate as much as $1 million a year in additional sales for Dynatronics, Cardon said.

Although Dynatronics’ shares are up nearly 150 percent so far this year, they closed Friday at 76 cents. That puts the company at odds with Nasdaq’s requirement that companies maintain a minimum-bid price of $1 on their shares to retain their listing on that stock market.

“We’re in discussions with Nasdaq on that issue, which is about all we can say right now,” Cardon said.

steve@sltrib.com

By Steven Oberbeck