Thank you. And good morning everyone.

Earlier today, we reported fourth quarter revenue of $8.5 million and adjusted earnings of $0.07. Even though the year-over-year comparison, as can be seen in the accompanying press release, are down, I view this – these results as noteworthy and obtained in an environment that continues to be challenged by the cyclic and continuing effects of the global pandemic.

While the effects of the pandemic are felt throughout the world, there are some bright spots during the quarter and two that I'd like to specifically call out. First, on a sequential basis, fourth quarter revenue continued its upward trend, increasing 11% over the third quarter.

This was largely driven by a nearly 24% sequential increase in revenue from our IV pumps and a nearly 17% sequential increase in revenue from our monitoring systems. These increases are a continuation of a trend that we noted in our third quarter, and we believe they are indicative of a successful adjustment by us and our customers toward adding nontraditional sales methods to our traditional practices.

We believe these sequential comparisons are important as we compare COVID-impacted periods and such a thought process should be enlightening to supplement other typical quarter-over-quarter analysis. Our second comparative bright spot is that customer orders for the fourth quarter were within 1.2% of our historical high watermark, which was in Q4 of 2019.

This performance was, in large part, driven by orders for our monitoring systems, which continue to perform very well, even in an environment where our ability to conventionally promote our products has been diminished, by hospitals limiting access to vendors and causing us to rely more upon the new selling methods that we've developed. Our success in generating orders resulted in a backlog of $4.4 million at the end of the year.

This backlog far exceeds previous backlogs going back several years. Both of these bright spots give us optimism about our future.

However, we temper that optimism with continued near-term uncertainty created by the pandemic, the global response to outbreaks and testing and vaccination rollout. I would also like to point out that the fourth quarter is typically our best quarter for bookings, which could be expected to cause breaks in the sequential comparisons beginning in Q1 of 2021.

Overall, from a sales perspective, COVID continues to impact our ability to sell our products. However, we are increasingly gaining access to radiology and MR suites, though, access to critical care areas of the hospital remain rather minimal.

As I have alluded to, we are overcoming these restrictions, wherever possible, by remaining persistent in our strategy of engaging customers through virtual means. As a result, we are generating an increasing number of trials and demonstrations for our products during the second half of the year.

In addition to selling into selling into traditional hospital channels, we have also seen positive but nascent trends selling into the veterinary market and outpatient MRI center. This should also assist in creating early traction for our ferromagnetic detection system as we begin our commercialization efforts.

We remain opportunistic regarding these channels, and we work towards capitalizing on every opportunity. As an update on regulatory statuses of our next-generation MRI pump, we continue to work through the 510(k) process, and we'll anticipate – and still anticipate clearance to take yet another 12 months.

At this time, we see no major issues impeding the next-gen pump's clearance. Regarding our development of new products, the engineering efforts on our ferromagnetic detection device are wrapping up, and we expect to bring this product to commercialization in the coming months.

We recently introduced the FMD device to our sales team where it was received very well, as they quickly recognized the value of – that it brings to customers. We are excited about opportunities that this device brings in our ability to leverage our domestic sales footprint as well as the capabilities of our distribution partners in international markets.

Now I'll turn the call over to Chris to summarize the financial results.

Good morning everyone. Consistent with past calls, I'll be discussing our financial results on a GAAP basis as well as on a non-GAAP basis.

Our non-GAAP operating results exclude stock-based compensation expense and other operating expenses that we believe are not indicative of our ongoing core operating performance. Infrequent tax items are considered based on their nature and excluded from the provision for income taxes as these items are not indicative of our normal provision.

Free cash flow is cash flow from operations, less cash used for purchases of property and equipment. We believe the presentation of these non-GAAP measures, along with our GAAP financial statements, can be helpful in providing a more thorough analysis of our ongoing financial performance.

You can find a reconciliation of these non-GAAP measures to the nearest GAAP measure on the last page of today's press release. As reported this morning, fourth quarter revenue – fourth quarter 2020 revenue was $8.5 million, or a decrease of 21.5% compared to the fourth quarter last year.

Revenue from domestic sales decreased 11.3% to $7.1 million during the current quarter, and revenue from international sales decreased nearly 50% to $1.4 million for the current quarter. The decrease in global sales was primarily driven by impacts from COVID-19, resulting in lower revenue from sales of our devices, which was partially offset by higher sales of disposables and service.

Device revenue decreased 33.6% to $5.3 million for the fourth quarter 2020. This decrease was driven by a 41.2% decline in IV pump revenue and a 23.7% decline in revenue from sales of our monitoring systems.

The average selling price of our average selling price of our MRI compatible IV infusion pump system during the fourth quarter 2020 was approximately $37,600 compared to approximately $33,100 for the fourth quarter of 2019. This increase in ASP relates to higher domestic unit sales and higher sales of the education and drug library components of our pump system, when compared to the fourth quarter last year.

The impact of these components on the ASP were magnified due to a smaller number of IV pump units sold during the current quarter. The average selling price of our MRI compatible patient vital signs monitoring system during the fourth quarter 2020 was approximately $37,500, compared to approximately $32,600 for the same in 2019.

Excuse me. This increase in ASP relates to higher domestic unit sales and a favorable product sales mix when compared to the fourth quarter last year.

Revenue from disposables and service grew 13.5% to $2.7 million and revenue from our maintenance contracts was consistent at $0.5 million for both periods. As we reviewed in our third quarter call, and Roger just spoke about, to supplement an understanding of more current trends, it is useful to sequentially compare COVID-impacted time periods.

Considering that, we have now seen two sequential quarters of revenue growth, with Q4 revenue increasing 11% over Q3. This increase was led by a 23.8% increase in pump revenue over Q3 and a 16.7% increase in revenue for monitor sales over Q3.

Gross margin was 75.3% for the 2020 quarter and 74.8% for the 2019 quarter. The increase in gross margin percent is the result of favorable inventory reserve adjustments compared to the same quarter last year.

Operating expenses were $5.8 million or 67.7% of revenue compared to $5.9 million or 54.3% of revenue for the fourth quarter last year. On a dollar basis, this decrease primarily relates to lower expenses for employee recruiting, payroll and benefits, and stock compensation, partially offset by higher sales commissions, and legal and professional fees.

We recognized tax expense of approximately $27,000 in the current quarter compared to a tax benefit of approximately $888,000 in the 2019 quarter. Our effective tax rate for the 2020 quarter was 4.1% compared to a negative 37.7% for the 2019 quarter.

The higher effective tax rate is primarily due to a benefit recognized in last year's quarter, associated with the CARES Act that allowed us to carry back our net operating loss created during 2019, three years prior to the enactment of the Tax Cuts and Jobs Act, which increases the benefit to the previously enacted Federal tax rate of 35% versus the current Federal tax rate of 21%. For the fourth quarter of 2020, we recognized net income of $0.05 per share compared to $0.26 for the 2019 quarter.

On a non-GAAP basis, net income was $0.07 per diluted share for the current quarter compared to $0.30 for the fourth quarter last year. From a cash flow perspective, we generated $5.8 million in cash from operations for the year ended December 31, 2020, compared to $10.2 million for the same period in 2019.

For the 2020-year, cash provided by operations was positively impacted by stock compensation, accounts receivable, net income, and depreciation and amortization. Cash from operations was negatively impacted by prepaid income taxes, prepaid expenses and other current assets.

For the three months ended December 31, 2020 and 2019, our free cash flow on non-GAAP measure was $2.4 million and $3.8 million, respectively. Lastly, we finished 2020 with a combined cash and investments balance of $52 million and no third-party debt or other restrictive covenants.

Now I'll turn the call over for questions.

Thank you, and good morning. Just a couple of questions.

First, in Q4, SG&A seemed to be a lot higher than previous quarters. Could you just talk about what's going on there and how we should think about that number going forward?

Hey, Scott. It’s Chris.

SG&A for the current quarter – are you talking about the sales, because G&A by itself was down if you're including sales?

Yes, I'm talking about sales and marketing, my mistake.

Sales and marketing costs were up. In large part, it was – about 80% of the increase was due to sales commissions.

And really, that resulted from us having to make some modifications to our commissions plan midyear to help compensate some of the impact from lower sales and how that relates to how our sales managers were ultimately being compensated. A large portion of their total compensation is variable or is commissionable.

And we needed to make an adjustment there to ensure that our folks are being taken care of, and to help offset some of the negative adjustments from COVID. So I think we were able to accomplish that successfully.

We saw – I think we – I think for the most part, Roger, I think, everybody was – that was helpful for everybody to get by. And as we think about plans for these coming years or in the future, we should see some normalization of the sales and marketing line back towards more historical levels or certainly movement in that direction in 2021.

Okay, great. Thanks.

That's helpful. And then just trying to think of – you've had some strong sequential growth quarter-to-quarter.

But Q4 does tend to be a strong quarter relative to Q1 of the next year. Should we expect sort of a sequential flat to down in Q1 or can you overtake that kind of seasonality of the calendar year?

Maybe, Scott, I can chime in on that one. I think what you're saying is, would we expect Q1 to be greater than Q4 was.

Well, no – short answer is no. It never has been.

And we certainly don't expect that to happen with this sort of resurgence of COVID that started to – we saw that effect beginning in the early part of December even. But that aside, Q4, as I said, was huge as far as the bookings.

So it was exceptionally great for us. We really started to figure out ways to do business, as I mentioned, even in the COVID.

But towards the last few weeks of December with the recurrence, we could feel the pinch returning. So we don't expect Q1 to set the world on fire at all.

Yes. But – and I think just to kind of balance out those comments, Roger, in your – in his prepared remarks there, we carried $4.4 million of backlog into the first quarter.

And those are backlog levels that we haven't seen for several years. So I think that was – I think that's helpful as we think about 2021.

But – so to Roger's point, though, the impact of COVID is still setting the pace and there's just so much uncertainty that we don't want – we're optimistic about the future. We want to balance that with just the environment that we're doing business in today.

Okay. Thank you.

That’s helpful. And typically, would a backlog be filled fully in the next quarter or sometimes may it lag over a couple of quarters?

Just trying to sense of – trying to think of how we should think about that backlog number.

There are times where customers will send us orders, maybe it's related to a new construction project, and they're not prepared to take the equipment for another six months or nine months or something along those lines. That said, the bulk of backlog is shippable.

It's shippable currently. But I don't want to – your premise was, is all of backlog shippable?

No, typically not all, but a significant majority of backlog is, yes.

Okay. Thank you.

That’s helpful. Final question on the monitors.

How was the mix between U.S. and international?

Was it kind of 50-50 or did it favor one geography over the other?

For this quarter, we favored more international on a unit basis, about 56% of our units went international in the fourth quarter.

Okay. That should do it for me.

Hey, congratulations guys on generating cash in a very tough year. Thanks for taking the questions.

Thanks Scott.

Thanks Scott.

Thanks. As I stated last quarter, COVID continues to set the pace of our business.

With a changing status of the pandemic and the variable global response, we are focused on remaining internally and externally agile and serving our customers to the greatest extent possible. We are making every effort to engage our customers, motivate distributors and control costs to attain as optimum a business performance level as possible.

We leave the year with positive momentum on our side. And while an elevated level of uncertainty still exists, we are optimistic about 2021.

We believe the first half of the New Year will remain challenging, while anticipating a more favorable business setting during the second half. Thank you for participating in the call, and we look forward to reporting to you again after the first quarter.