Milestone Scientific Announces First Quarter Operating Results
LIVINGSTON, N.J., May 16 /PRNewswire-FirstCall/ -- Milestone Scientific Inc. , which develops, manufactures, and markets 'intelligent' computer controlled injection systems for medical and dental markets, today announced its operating results for the first quarter of 2006.
For the three months ended March 31, 2006, total revenue increased 17% to $1,697,756, compared with $1,457,903 in the first quarter of 2005. Net product sales increased 7% to $1,560,919, versus $1,457,903 in the quarter ended March 31, 2005. Product sales during the most recent quarter included a 12% increase in domestic handpiece sales and $55,957 in worldwide whitening sales, which did not exist in the prior-year quarter. Domestic CompuDent(TM) sales decreased 32%, which was partially offset by a 34% increase in international CompuDent sales. The Company recorded $136,837 in royalty income from sales of the Ionic White(TM) consumer tooth whitening product, which was introduced into the marketplace by a strategic partner in the second quarter of 2005.
Gross profit on product sales increased to 55% in the first quarter of 2006, compared with 51.0% in the prior-year period, reflecting strength in disposable handpiece sales. Gross profit on royalty income approximated 88.0% in the quarter ended March 31, 2006.
Selling, general and administrative expenses were reduced by $121,979, or 7.6%, to $1,479,714 during the first quarter of 2006, versus $1,601,693 in the year-earlier period. Research and development expenses for the three months ended March 31, 2006 increased to $163,442, compared with $31,545 in the first quarter of 2005. The increase was primarily associated with the development of Milestone's Single Tooth Anesthetic (STA) delivery system and continuing efforts on the CompuFlo(TM) technology.
The Company's net loss was reduced by approximately 22% to ($685,579), or ($0.06) per share, in the most recent quarter, when compared with a net loss of ($878,943), or ($0.09) per share, in the corresponding period of the previous year. The Company ended the most recent quarter with $4.6 million in working capital and $2.4 million in cash and cash equivalents on its balance sheet.
"Most of our revenues continue to be generated through sales of our CompuDent system and the Wand disposable handpiece sales to customers in the United States and over 24 foreign countries," commented Leonard Osser, Chief Executive Officer of Milestone Scientific Inc. "During the first quarter, we took steps to enhance the efficiency and effectiveness of our domestic sales operation by reducing headcount and eliminating the positions of several under performing inside sales representatives. While this had the short-term effect of reducing domestic sales of CompuDent systems in the first quarter, we believe such actions were supportive of our goal to become, at minimum, cash neutral from our domestic sales of CompuDent units and CoolBlue Whitening kits. This goal was achieved in March 2006."
"Milestone continues development work on two important technologies that we believe hold great promise in terms of future revenue potential and our commitment to enhance long-term shareholder value. The Single Tooth Anesthesia (STA) delivery system, currently in development, will allow dentists to perform a predictable single tooth anesthetic injection to achieve total tooth anesthesia, as a primary injection. This should become an invaluable tool, as many consider this type of injection to be the most important injection for the dentist and preferred by patients. We continue to anticipate commercial launch of the STA device in early 2007."
"We also continue our development efforts involving CompuFlo, our Computer Controlled Infusion Pump technology that is first being targeted for spinal anesthesia, including epidural anesthesia," continued Osser. "We have contracted with an outside firm to identify additional clinical applications for this technology in the all-important medical space. It is our objective to identify and enter into a relationship with a strategic partner in the medical products field, which can leverage our efforts to commercialize CompuFlo. As we reported earlier, we filed a 510(k) Premarket Notification with the FDA in late December 2005."
Shareholders and other interested parties may participate in the conference call by dialing 888-694-4702 (international/local participants dial 973-582-2741) and referencing the ID code7388708, a few minutes before 11:00 a.m. EDT on Tuesday, May 16, 2006. A replay of the conference call will be available two hours after the completion of the conference call from May 16, 2006 until May 23, 2006 by dialing 877-519-4471 (international/local participants dial 973-341-3080) and entering the conference ID 7388708.
About Milestone Scientific Inc.
Milestone Scientific Inc. is the developer, manufacturer and marketer of CompuMed(R) and CompuDent(R) computer controlled injection systems. These systems comprise a microprocessor controlled drive unit as well as The Wand(R) handpiece, a single patient use product that is held in a pen-like manner for injections. The Company also sells the SafetyWand(R), which incorporates engineered sharps injury protection features to aid in the prevention of accidental needlesticks. Milestone has also developed proprietary consumer (Ionic White(TM)) and professional (CoolBlue(TM)) teeth whitening systems that were introduced to the market in 2005.
In 2001, Milestone Scientific received broad United States patent protection on an enabling technology for computer controlled, pressure sensitive infusion, perfusion, suffusion and aspiration, which provides real time displays of pressures, fluid densities and flow rates, that advances the delivery and removal of a wide array of fluids. Development of this CompuFlo technology is currently underway.
The Company is headquartered in Livingston, New Jersey, and its common stock trades on the American Stock Exchange under the symbol "MSS".
This press release contains forward-looking statements regarding the timing and financial impact of the Milestone's ability to implement its business plan, expected revenues and future success. These statements involve a number of risks and uncertainties and are based on assumptions involving judgments with respect to future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond Milestone's control. Some of the important factors that could cause actual results to differ materially from those indicated by the forward-looking statements are general economic conditions, failure to achieve expected revenue growth, changes in our operating expenses, adverse patent rulings, FDA or legal developments, competitive pressures, changes in customer and market requirements and standards, and the risk factors detailed from time to time in Milestone's periodic filings with the Securities and Exchange Commission, including without limitation, Milestone's Annual Report on Form 10-KSB for the year ended December 31, 2005. The forward looking-statements in this press release are based upon management's reasonable belief as of the date hereof. Milestone undertakes no obligation to revise or update publicly any forward-looking statements for any reason.
CONTACT Leonard Osser, Chairman and CEO Milestone Scientific Inc. (973) 535-2717; (973) 535-2829 (Fax) Web site: www.milesci.com MILESTONE SCIENTIFIC INC. CONDENSED BALANCE SHEETS March 31, December 31, 2006 2005* (Unaudited) ASSETS Current Assets: Cash and cash equivalents $2,444,810 $2,892,679 Accounts receivable, net of allowance for doubtful accounts of $34,830 in 2006 and $27,117 in 2005 497,973 347,065 Royalty receivable 136,838 185,702 Inventories 1,345,698 1,371,354 Advances to contract manufacturer 1,163,520 1,019,663 Prepaid expenses 98,651 109,691 Total current assets 5,687,490 5,926,154 Investment in distributor, at cost 76,319 76,319 Equipment, net of accumulated depreciation of $331,127 in 2006 and $307,000 in 2005 510,077 536,295 Patents, net of accumulated amortization of $24,802 in 2006 and $19,090 in 2005 483,728 486,635 Other assets 21,683 24,197 Total assets $6,779,297 $7,049,600 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $630,659 $508,044 Accrued expenses 381,620 223,350 Deferred compensation payable to officers 43,333 -- Total current liabilities 1,055,612 731,394 Stockholders' Equity Common stock, par value $.001; authorized 50,000,000 shares; 11,594,547 shares issued, 207,726 shares to be issued, and 11,561,214 shares outstanding in 2006; 11,550,479 shares issued, 207,726 shares to be issued, and 11,517,146 shares outstanding in 2005 11,803 11,758 Additional paid-in capital 57,263,928 57,172,915 Accumulated deficit (50,640,530) (49,954,951) Treasury stock, at cost, 33,333 shares (911,516) (911,516) Total stockholders' equity 5,723,685 6,318,206 Total liabilities and stockholders' equity $6,779,297 $7,049,600 See Notes to Condensed Financial Statements * Derived from the audited financial statements as of December 31, 2005 MILESTONE SCIENTIFIC INC. CONDENSED STATEMENTS OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2006 AND 2005 (Unaudited) March 31, March 31, 2006 2005 Product sales, net $1,560,919 $1,457,903 Royalty income 136,837 Total revenue 1,697,756 $1,457,903 Cost of products sold 751,162 714,706 Royalty expense 16,421 Total cost of revenue 767,583 714,706 Gross profit 930,173 743,197 Selling, general and administrative expenses 1,479,714 1,601,693 Research and development expenses 163,442 31,545 Total operating expenses 1,643,156 1,633,238 Loss from operations (712,983) (890,041) Other income Interest income 27,404 11,098 Total other income 27,404 11,098 Net loss (685,579) (878,943) Dividends applicable to preferred stock -- (507) Net loss applicable to common stockholders $(685,579) $(879,450) Loss per share applicable to common stockholders - basic and diluted $(0.06) $(0.09) Weighted average shares outstanding and to be issued - basic and diluted 11,741,578 9,882,041 See Notes to Condensed Financial Statements MILESTONE SCIENTIFIC INC. CONDENSED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2006 AND 2005 (Unaudited) 2006 2005 Cash flows from operating activities: Net loss $(685,579) $(878,943) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation expense 24,300 24,876 Amortization of patents 5,712 2,531 Common stock and options issued for compensation, consulting, and vendor services 91,058 170,333 Other 1,918 Bad debt expense 7,743 3,402 Changes in operating assets and liabilities: (Increase) in accounts receivable (158,651) (105,052) Decrease in royalty receivable 48,864 -- Decrease in inventories 25,656 614 (Increase) in advances to contract manufacturer (143,857) -- Decrease (increase) in prepaid expenses 11,040 (2,677) Decrease in other assets 2,514 1,569 Increase in accounts payable 122,615 21,756 Increase (decrease) in accrued expenses 158,270 (56,956) Increase in deferred compensation 43,333 37,500 Net cash used in operating activities (445,064) (781,047) Cash flows from investing activities: Payment for capital expenditures -- (1,550) Payment for patent rights (2,805) -- Net cash used in investing activities (2,805) (1,550) Cash flows from financing activities: Proceeds from equity financing, net -- 1,637,193 Net cash provided by financing activities -- 1,637,193 NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (447,869) 854,596 Cash and cash equivalents at beginning of period 2,892,679 3,041,306 Cash and cash equivalents at end of period $2,444,810 $3,895,902 See Notes to Condensed Financial StatementsMilestone Scientific Inc.
CONTACT: Leonard Osser, Chairman and CEO of Milestone Scientific Inc.,+1-973-535-2717, or fax, +1-973-535-2829
Web site: http://www.milesci.com/