Covalon Technologies Ltd. Announces First Quarter Financial Results

MISSISSAUGA, ONTARIO--(Marketwire - February 27, 2009) - Covalon Technologies Ltd. (TSX VENTURE: COV), an advanced biomedical systems company, today reported its fiscal 2009 first quarter financial results for the 3 months ended December 31, 2008. Total revenues for the quarter were $462,167, a decrease from the $930,893 reported in the first quarter of the 2008 fiscal year. Net loss was $1.3 million or $0.02 per share compared to a net loss of $676,007 or $0.01 per share for the first quarter of the 2008 fiscal year.

As at December 31, 2008, Covalon reported Cash equivalents held to support operations of $10.8 million and a working capital balance of $10.0 million.

Peter Hobbes, Covalon’s CFO said, “Sales of our wound care products did not materialize as expected in this quarter while sales of our antimicrobial coatings saw some significant increase. We remain confident that investments in these two product lines as well as new business development projects we are working on will yield increased revenues in the future.”

Dr. Frank DiCosmo, Covalon’s President and CEO said, “We are working hard with our existing partners to grow our technology base already in the market. At the same time, we are diligently working on developing a number of new partnerships to significantly expand our technology offerings in the marketplace.”

The Company’s consolidated financial statements and MD&A for the first quarter ended December 31, 2008 are available at www.sedar.com and on the Company’s website at www.covalon.com.

About Covalon

Covalon Technologies Ltd. is an advanced medical products company that has developed, patented and commercialized therapeutic biomaterials for wound care and surgical applications and coatings. Polymer chemistry and surface coating technology have been combined to create a range of time-release drug delivery platforms that are applied to medical devices to treat many critical conditions. A variety of applications for these technologies have been identified and specific products have been developed. The products offer features and benefits providing solutions to many of the problems caused by current devices and their material properties which are used by most medical device manufacturers and suppliers. The problems include infection, poor biocompatibility, and microbial attachment.

This news release contains forward-looking statements which reflect the Company’s current expectations regarding future events. The forward-looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “plan, “estimate”, “expect”, “intend” and statements that an event or result “may”, “will”, “should”, “could” or “might” occur or be achieved and other similar expressions. These forward-looking statements involve risk and uncertainties, including the difficulty in predicting product approvals, acceptance of and demands for new products, the impact of the products and pricing strategies of competitors, delays in developing and launching new products, the regulatory environment, fluctuations in operating results and other risks, any of which could cause results, performance, or achievements to differ materially from the results discussed or implied in the forward-looking statements. Many risks are inherent in the industry; others are more specific to the Company. Investors should consult the Company’s ongoing quarterly filings for additional information on risks and uncertainties relating to these forward-looking statements. Investors should not place undue reliance on any forward-looking statements. Management assumes no obligation to update or alter any forward-looking statements whether as a result of new information, further events or otherwise.

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