Misonix Reports Nine Months Fiscal 2013 Financial Results

          Misonix Reports Nine Months Fiscal 2013 Financial Results

Recurring Revenue for the Nine months Equal 43% of Net Sales

PR Newswire

FARMINGDALE, N.Y., May 9, 2013

FARMINGDALE, N.Y., May 9, 2013 /PRNewswire/ --Misonix, Inc. (NASDAQ: MSON), a
surgical device company that designs, manufactures and markets innovative
therapeutic ultrasonic products worldwide for spine surgery, cranial maxillo –
facial surgery, neurosurgery, wound debridement, cosmetic surgery,
laparoscopic surgery and other surgical applications, today reported financial
results for the nine months and the third quarter of fiscal year 2013, ended
March 31, 2013.

Highlights for the quarter and the nine month period include:

  oRevenue for the nine months increased 7% to $11.1 million compared to
    $10.4 million in the first nine months of 2012. Third quarter revenue
    decreased 17% to $3.0 million compared to $3.6 million in the third
    quarter of 2012.
  oBoneScalpel™ revenue increased 55% for the first nine months of 2013;
    SonicOne revenue increased 83% for the nine months.
  oExcluding revenue from legacy products, BoneScalpel, SonicOne and SonaStar
    revenue increased 27% for the first nine months of fiscal 2013 to $10.2
    million versus the comparable period in 2012.
  oFor the nine months, BoneScalpel, SonicOne and SonaStar domestic sales
    increased 39% to $3.6 million.
  oBone Scalpel domestic disposables revenue and domestic units sold
    increased 48% and 44% respectively, over the second quarter fiscal 2013.
  oRoyalty income received totaled $1.8 million for the nine months ended
    March 31, 2013 versus $462,000 for the same period in fiscal 2012.
  oDuring the quarter, the Company received 2 method-of-use patents related
    to the BoneScalpel product; and applied for 5 patents, including
    method-of-use and upgraded technology for the BoneScalpel product.
  oCash and cash equivalents totaled $6.1 million at March 31, 2013 with no
    long-term debt.
  oFor the nine months, the Company reported a net loss of $1.1 million, or
    $(0.16) per share, compared to a net loss of $78,488, or $(0.01) per
    share, in the comparable nine month period of 2012. For the third quarter
    of fiscal 2013, the Company reported a net loss of $528,330, or $(0.08)
    per share, compared to a net loss of $214,625, or $(0.03) per share, in
    the third quarter of 2012.

Q3 2013 Financial Results:

For the third quarter of fiscal 2013, revenue was $3.0 million, comparable to
$3.6 million in the third quarter of 2012. BoneScalpel revenue for the quarter
decreased 10% to $1.1 million compared to $1.2 million in the comparable
quarter of fiscal 2012. BoneScalpel domestic disposable sales increased to
$228,000, or 47.7%, compared to BoneScalpel disposable sales in the fiscal
second quarter of 2012. SonicOne revenue increased 86% to $398,074 compared
to $213,686 in the third quarter last year. SonaStar revenue decreased 15% to
$1.3 million compared to $1.5 in the third quarter last year. BoneScalpel,
SonicOne and Sonastar revenue decreased 6% to $2.8 million for the three
months ended March 31, 2013 compared to the comparable period in fiscal 2012.

As expected, other revenue, which includes the legacy products Autosonix and
Lysonix, sold by outside distribution partners, decreased 66% as these late
stage products approach end-of-life.

For the quarter, royalty income, received predominantly from Covidien,
increased substantially to $1.0 million compared to $135,794 in the third
quarter of 2012.

Gross margin for the third quarter of fiscal 2013 was 51%, primarily
attributable to an unfavorable mix of low and high margin product deliveries
and the increase in minimum gross profit contribution requirements related to
the Soma product, which had a 6.2% adverse effect on gross margin. Operating
expenses for the third fiscal quarter increased 27%, as the Company continued
to invest in research and development, sales, marketing and customer support
capabilities.

For the third quarter of fiscal year 2013, the Company reported a net loss of
$528,330, or $(0.08) per share, which included income from discontinued
operations of $172,007, or $0.02 per share, compared to a net loss of
$214,625, or $(0.03) per share, in the comparable three month period of 2012,
which included a net loss from discontinued operations of $163,243, and a gain
from the sale of discontinued operations of $225,032, resulting in net income
from discontinued operations of $61,789, or $0.01 per share.

Nine Months 2013 Financial Results:

Net sales increased seven percent to $11.1 million for the nine months ended
March 31, 2013 from $10.4 million in the nine months ended March 31, 2012.
BoneScalpel revenue for the nine months increased 55% to $4.8 million compared
to $3.1 million in the comparable period of fiscal 2012. SonicOne revenue
increased 83% to $1.4 million compared to $777,885 in the nine month period of
the prior year. SonaStar revenue decreased 5.6% to $3.9 million compared to
$4.1 million for the nine month period of 2012.

As expected, other revenue, which includes legacy the products Autosonix and
Lysonix sold by outside distribution partners, decreased $1.5 million, or 63%,
as these late stage products approach end-of-life. Excluding all other
revenue, BoneScalpel, SonicOne and SonaStar revenues increased 27% for the
nine months ended March 31, 2012.

For the first nine months of fiscal 2013, royalty income received,
predominantly from Covidien, increased substantially to $1.8 million compared
to $462,301 for the first nine months of 2012.

Gross margin for the nine months ended March 31, 2013 was 55%, primarily
attributable to an unfavorable mix of low and high margin product deliveries
in addition to the increase in minimum gross profit contribution requirement
related to the Soma product which had a 5% adverse impact on gross margin.
Operating expenses for the nine month period increased 17% as the Company
continued to invest in research and development, sales, marketing and customer
support capabilities.

For the nine months, the Company reported a net loss of $1.1 million, or
$(0.16) per share, which included income from discontinued operations of
$181,800, or $0.03 per share, compared to a net loss of $78,488, or $(0.01)
per share in the comparable nine month period of 2012, which included a net
loss from discontinued operations of $369,424, and a gain from the sale of
discontinued operations of $1.1 million, totaling net income from discontinued
operations of $773,966, or $0.11 per share.

Michael A. McManus, Jr., president and chief executive officer of Misonix,
commented, "For the nine months of fiscal 2013, we had a very positive impact
from the recurring revenue component of our business – disposables sales of
our flagship BoneScalpel, SonicOne and SonaStar products. Revenue from the
sale of disposables totaled $4.8 million, or 43% of total sales. On a
sequential basis, BoneScalpel disposables revenue and unit sales increased 48%
and 44%, respectively, in the third quarter from the second quarter.

"Disposable revenue is significant in that hospitals across the country are
increasingly evaluating medical devices for efficacy and cost effectiveness
and have distinctly lengthened the domestic sales cycle. The resulting delay
in completing instrument sales or placements is now being increasingly offset
by our growing recurring revenue component. In addition, we are now
benefitting to a greater degree by expanded royalty income and license fees.
We have developed a significant portfolio of intellectual property and are
pleased to see that it is generating increasing royalty revenue, predominantly
from Covidien, as evidenced by the $1.8 million earned in the nine months of
2013 compared to the $462,000 earned in the comparable nine months of 2012."

"While the dynamics in the healthcare markets appear to be changing, we are
well positioned to address these changes. The financial condition of the
Company continues to be strong with a solid cash position and no long-term
debt. We have a diversified revenue stream with a growing recurring revenue
component, improving royalty income and leading-edge ultrasonic surgical
instruments that deliver improved patient outcomes and operating efficiencies
to the global surgical community. We believe there are great opportunities
going forward," concluded Mr. McManus.

Conference Call:

Michael A. McManus, Jr., president and chief executive officer, and Richard
Zaremba, senior vice president and chief financial officer, will host a
conference call on Thursday, May 9, 2013, at 4:30 pm ET to discuss the
financial results of the first nine months of fiscal 2013.

Shareholders and other interested parties can access the conference call by
dialing (877) 317-6789 or (412) 317-6789 or can listen via a live Internet
webcast, which is available in the Investor Relations section of the Company's
website at www.misonix.com.

A teleconference replay of the call will be available for three days at (877)
344-7529 or (412) 317-0088, confirmation # 10028599. A webcast replay will be
available in the Investor Relations section of the Company's website at
www.misonix.com for 30 days.

About Misonix:

Misonix, Inc. designs, manufactures and markets therapeutic ultrasonic medical
devices. Misonix's therapeutic ultrasonic platform is the basis for several
innovative medical technologies. Addressing a combined market estimated to be
in excess of $3 billion annually; Misonix's proprietary ultrasonic medical
devices are used for wound debridement, cosmetic surgery, neurosurgery,
laparoscopic surgery, and other surgical and medical applications. Additional
information is available on the Company's Web site at www.misonix.com.

With the exception of historical information contained in this press release,
content herein may contain "forward looking statements" that are made pursuant
to the Safe Harbor Provisions of the Private Securities Litigation Reform Act
of 1995. These statements are based on management's current expectations and
are subject to uncertainty and changes in circumstances. Investors are
cautioned that forward looking statements involve risks and uncertainties that
could cause actual results to differ materially from the statements made.
These factors include general economic conditions, delays and risks associated
with the performance of contracts, risks associated with international sales
and currency fluctuations, uncertainties as a result of research and
development, acceptable results from clinical studies, including publication
of results and patient/procedure data with varying levels of statistical
relevancy, risks involved in introducing and marketing new products, potential
acquisitions, consumer and industry acceptance, litigation and/or court
proceedings, including the timing and monetary requirements of such
activities, the timing of finding strategic partners and implementing such
relationships, regulatory risks including approval of pending and/or
contemplated 510(k) filings, the ability to achieve and maintain profitability
in the Company's business lines, and other factors discussed in the Company's
Annual Report on Form 10 K, subsequent Quarterly Reports on Form 10 Q and
Current Reports on Form 8 K. The Company disclaims any obligation to update
its forward looking relationships.

Misonix Contact:   Investor Relations Contact:
Richard Zaremba    Joe Diaz, Lytham Partners
631-694-9555       602-889-9700
invest@misonix.com mson@lythampartners.com





MISONIX, INC. And Subsidiaries
Consolidated Balance Sheets
                                         March 31, 2013  June 30, 2012
                                         (Unaudited)     (derived from audited
                                                         financial statements)
Assets
Current Assets:
 Cash and cash equivalents              $6,091,564      $6,273,015
 Accounts receivable, less allowance
 for doubtful accounts of
$199,641 and
 $155,739, respectively            2,788,281       3,158,084
 Inventories, net                       4,448,400       4,380,841
 Prepaid expenses and other current     328,219         306,691
assets
 Note receivable                        -               198,117
Total current assets                     13,656,464      14,316,748
Property, plant and equipment, net       1,172,781       891,822
Goodwill                                 1,701,094       1,701,094
Intangible and other assets              1,193,205       1,403,173
Total assets                             $17,723,544     $18,312,837
Liabilities and stockholders' equity
Current liabilities:
 Accounts payable                       $1,367,586      $1,507,695
 Accrued expenses and other current     1,203,282       1,074,932
liabilities
Total current liabilities                2,570,868       2,582,627
Deferred income                          83,987          117,147
Deferred lease liability                 23,607          22,996
Total liabilities                        2,678,462       2,722,770
Commitments and contingencies
Stockholders' equity:
 Capital stock, $0.01 par value -
shares authorized
 20,000,000, 7,169,046 and
7,082,920 shares issued                  71,690          70,829
 and 7,091,486 and 7,005,360 shares
outstanding,
 respectively
 Additional paid-in capital             26,724,370      26,132,951
 Accumulated deficit                    (11,339,985)    (10,202,720)
 Treasury stock, at cost, 77,560        (410,993)       (410,993)
shares
Total stockholders' equity               15,045,082      15,590,067
Total liabilities and stockholders'      $17,723,544     $18,312,837
equity







MISONIX, INC. And
Subsidiaries
Consolidated Statements of
Operations
Unaudited
                            Three Months Ended   Nine Months Ended
                           March 31,                  March 31,
                           2013          2012         2013         2012
Net sales                  $3,023,487    $3,609,746   $11,068,243  $10,377,480
Cost of goods sold         1,482,329     1,491,225    4,953,193    4,226,193
Gross profit               1,541,158     2,118,521    6,115,050    6,151,287
Selling expenses           1,764,718     1,245,782    4,768,867    3,620,079
General and administrative 1,155,613     1,024,029    3,290,671    3,274,234
expenses
Research and development   379,901       333,308      1,143,289    946,984
expenses
Total operating expenses   3,300,232     2,603,119    9,202,827    7,841,297
Loss from operations       (1,759,074)   (484,598)    (3,087,777)  (1,690,010)
Total other income         999,611       122,322      1,713,415    549,421
Loss from continuing
operations before income  (759,463)     (362,276)    (1,374,362)  (1,140,589)
taxes
Income tax benefit         (59,126)      (85,862)     (55,297)     (288,135)
Net loss from continuing   (700,337)     (276,414)    (1,319,065)  (852,454)
operations
Discontinued operations:
Gain from sale of
discontinued operations
net of tax expense         168,651       225,032      168,651      1,143,390
of$81,349,$29,756,
$81,349 and $562,024,
respectively
Net income (loss) from
discontinued operations,
net of a tax expense of
$1,619, tax benefit of     3,356         (163,243)    13,149       (369,424)
$51,070, tax expense of
$1,619 and a tax benefit
of $181,587, respectively
Net income from            172,007       61,789       181,800      773,966
discontinued operations
Net loss                  ($528,330)    ($214,625)   ($1,137,265) ($78,488)
Net loss per share from
continuing                 ($0.10)       ($0.04)      ($0.19)      ($0.12)
operations-Basic
Net income per share from
discontinued               0.02          0.01         0.03         0.11
operations-Basic
Net loss per share-Basic   ($0.08)       ($0.03)      ($0.16)      ($0.01)
Net loss per share from
continuing                 ($0.10)       ($0.04)      ($0.19)      ($0.12)
operations-Diluted
Net income per share from
discontinued               0.02          0.01         0.03         0.11
operations-Diluted
Net loss per share-Diluted ($0.08)       ($0.03)      ($0.16)      ($0.01)
Weighted average common    7,060,965     7,001,404    7,028,790    7,001,381
shares-basic
Weighted average common    7,060,965     7,001,404    7,028,790    7,001,381
shares-diluted



SOURCE Misonix, Inc.

Website: http://www.misonix.com
 
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