TSO3 Reports Second Quarter 2016 Results

Repeats Record Shipments, Re-engineers Facilities and Receives Industry-Changing Regulatory Clearances

QUÉBEC CITY, August 3, 2016 /PRNewswire/ - TSO3 Inc. (TSX: TOS) ("TSO3" or the "Company"), an innovator in sterilization technology for medical devices in healthcare settings, reported its financial and operating results for the second fiscal quarter ended June 30, 2016. All figures are in U.S. dollars unless otherwise noted.

Q2 2016 Highlights and Subsequent Events 

• Repeated record shipments of 25 STERIZONE^® VP4 Sterilizers to Getinge Infection Control, the Company's exclusive global distribution partner, and recorded revenues of $3.0 million, versus $3.1 million in Q1 2016 and $0.1 million in Q2 2015.
• Announced the receipt of US Food and Drug Administration (FDA) clearance of TSO₃'s expanded indications for use (IFU's) of its STERIZONE® VP4 Sterilizer relating to certain multi-channel flexible endoscopes of up to 3.5 meters in length and not more than four channels. This represents an entirely new level of patient protection against ineffective device reprocessing of devices such as gastroscopes and colonoscopes both of which represent tens of millions of procedures each year in the U.S. and Europe, and neither of which are terminally sterilized today.
• Completed significant process and assembly reengineering, which increased production capacity, when required, to 250 sterilizers annually at its facility in Quebec, Canada.
• Cash, cash equivalents and short-term investments were $21.3 million at June 30, 2016, as compared to $24.4 million at the end of Q1 2016. The Company had 91.2 million shares outstanding, no outstanding warrants and no debt at the end of the Q2 2016.
• The Company prepared for its launch into the European market by introducing its FDA-cleared universally designed STERIZONE® VP4 Sterilizer platform and is completing the development of its double-door STERIZONE® VP4 Sterilizer, which is highly desirable in many European markets. 
• Peer-reviewed paper describing the STERIZONE^® VP4 Sterilizer was accepted for publication in an upcoming issue of the Canadian Journal of Infection Control.

Management Commentary

"Q2 was another strong quarter with shipments of our STERIZONE^® VP4 Sterilizers, enhanced regulatory claims and a complete redesign of our assembly operations," said TSO₃ President and CEO R.M. (Ric) Rumble. "We have made significant improvements in our potential while leading a disciplined core operation."

"We recently announced that we received clearance from the FDA regarding our extended claims relating to multi-channel flexible endoscopes, such as colonoscopes and gastroscopes, as well as the validation of our technology's ability to terminally sterilize multiple, heavy-duty battery-powered orthopedic instrument sets. These achievements have generated tremendous customer interest in our STERIZONE® VP4 Sterilizer and have moved us into a new paradigm our technology has opened the door to opportunities far beyond the traditional low-temperature sterilizer market.  Millions of procedures previously untouched by low-temperature sterilization are now addressable effectively by our technology."

"As we look ahead this year, we will continue to pursuit a leadership position in healthcare sterile reprocessing of medical devices, including low temperature sterilization, high-level disinfection and steam sterilization applications.

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