Urologix Reports Fiscal Year 2014 First Quarter Results

Urologix Reports Fiscal Year 2014 First Quarter Results

Executive Summary

  *First quarter revenue totaled $3.8 million, down 4.8% year-over-year.
  *Reaffirms fiscal year 2014 total revenue guidance in the range of $15
    million to $17 million.

MINNEAPOLIS, Oct. 29, 2013 (GLOBE NEWSWIRE) -- Urologix®, Inc. (OTCQB:ULGX),
the leading provider of in-office procedures for the safe, durable and
effective treatment of BPH, today reported financial results for its fiscal
year 2014 first quarter ended September 30, 2013.

First quarter fiscal year 2014 revenue totaled $3.8 million, down 4.8%
compared to the first quarter of fiscal year 2013. Results in the first
quarter of fiscal year 2014 were negatively impacted by a significant slowdown
in international sales of Prostiva. First quarter revenue declined 9.7%
sequentially driven primarily by a decline in sales of disposable products
from both product lines.

"While we did not achieve year-over-year growth in the first quarter, our
revenue results in the US showed relative improvement compared to our fourth
quarter performance," stated Greg Fluet, Chief Executive Officer. "We continue
to have confidence in the potential for our team and our technologies to
deliver value to the three primary healthcare constituents: patients,
providers and payors. Against the backdrop of a challenging healthcare
environment, we believe that our continued focus on execution and disciplined
management of our resources will allow us to achieve our fiscal year guidance
in the range of $15 million to $17 million."

As of September 30, 2013, the Company's cash balance was$1.6 millioncompared
to$2.3 millionas ofJune 30, 2013. The cash balance decreased
$739,000compared toJune 30, 2013. The first quarter of the fiscal year
historically has larger cash payments related to annual expenses, primarily
insurance premiums, which totaled $259,000 in the first quarter of fiscal year
2014. The Company has an existing line of credit currently in place
withSilicon Valley Bank for $2 million (subject to a defined borrowing base).
The Company's cash needs will be determined by a number of items including
operating performance, accessibility of the line of credit and the timing of
annual royalty payments due in the second quarter of the fiscal year totaling
$650,000 as yet unpaid.

Gross profit for the first quarter of fiscal year 2014 was$1.9 million, or
49.3% of revenue, compared to$2.0 million, or 50.8% of revenue, in the first
quarter of fiscal year 2013. The decrease in gross margin was primarily
driven by lower production volumes in the first quarter of fiscal year 2014
compared to the prior year.

Total operating expense was$3.0 millionfor the first quarter of fiscal year
2014, up 2.9% year-over-year. Operating expense in the first quarter of fiscal
year 2014 included $61,000 related to the medical device excise tax which did
not occur in the prior year. Additionally, total operating expense in the
first quarter of fiscal year 2014 included a non-cash net gain on the change
in value of acquisition consideration of $9,000 compared to $154,000 in the
prior year. Excluding the impact from these items, operating expense declined
3.9% compared to the prior year. The 3.9% decrease in operating expense was
driven by a $194,000 decrease in research and development expense and a
$53,000 decrease in general and administrative expense, partially offset by a
$128,000 increase in sales and marketing expense due to investments made in
the direct sales force.

For the first quarter of fiscal year 2014,Urologixreported a net loss
of$1.3 million, or$0.06per diluted share, compared to a net loss of$1.1
million, or$0.05per diluted share, in the first quarter of fiscal year 2013.


The Company is reaffirming the fiscal year 2014 total revenue guidance range
of $15 million to $17 million.

Earnings Call Information

Urologixwill host a conference call with the financial community to discuss
fiscal year 2014 first quarter results onTuesday, October 29, 2013at4:00
p.m. Central Daylight Time. To listen to the call, please dial 1-866-318-8617
and enter the Participant Passcode 50249354 at least 10 minutes prior to the
call. A live webcast of the call will be available through the investor
relations section of the Company's website atwww.urologix.comand available
for replay approximately two hours after the completion of the call.

About Urologix

Urologix, Inc., based in Minneapolis, develops, manufactures, markets and
distributes minimally invasive medical products for the treatment of
obstruction and symptoms due to Benign Prostatic Hyperplasia (BPH). Urologix'
Cooled ThermoTherapy™ produces targeted microwave energy combined with a
unique cooling mechanism to protect healthy tissue and enhance patient
comfort. The Prostiva® RF Therapy System delivers radio frequency energy
directly into the prostate destroying prostate tissue, reducing constriction
of the urethra, and thereby relieving BPH symptoms. Both of these therapies
provide safe, effective and lasting relief of the symptoms and obstruction due
to BPH. Prostiva® is a registered trademark of Medtronic, Inc., used under
license. All other trademarks are the property of Urologix.

If you'd like more information on this topic, please contact Brian Smrdel at
(763) 475-7696 or bsmrdel@urologix.com or to learn more about Urologix and its
products and services, visit their website at www.urologix.com.

The Urologix, Inc. logo is available at

Forward Looking Statements

This press release contains forward-looking statements that are made pursuant
to the safe harbor provisions of the Private Securities Litigation Reform Act
of 1995. Any statements contained in this press release that are not
statements of historical fact may be deemed to be forward-looking statements.
Without limiting the foregoing, words such as "may," "will," "expect,"
"believe," "anticipate," "estimate" or "continue" or comparable terminology
are intended to identify forward-looking statements. Such forward looking
statements include, for example, the effectiveness of the Company's sales and
marketing strategies and organization, the Company's future revenue and
operating performance, the development and marketing of new products, the
timing or payment of any amounts to Medtronic, or the availability of
borrowing under the line of credit with Silicon Valley Bank. The statements
made by the Company are based upon management's current expectations and are
subject to certain risks and uncertainties that could cause the actual results
to differ materially from those described in the forward-looking statements.
These risks and uncertainties include market conditions and other factors
beyond the Company's control and the risk factors and other cautionary
statements described in the Company's Annual Report on Form 10-K for the year
ended June 30, 2013 and other documents filed with the Securities and Exchange

Urologix, Inc.
Statements of Operations
(Unaudited, in thousands, except per share data)
                                                           Three Months Ended
                                                            September 30,
                                                           2013      2012
Sales                                                       $3,779    $3,970
Cost of goods sold                                         1,915     1,954
Gross profit                                               1,864     2,016
Costs and expenses:                                                  
Sales and marketing                                         1,845     1,717
General and administrative                                  685       738
Research and development                                   421       615
Change in value of acquisition consideration                (9)       (154)
Medical device tax                                          61        -
Amortization                                                23        26
Total costs and expenses                                    3,026     2,942
Operating loss                                              (1,162)   (926)
Interest expense                                            (161)     (123)
Foreign currency exchange gain/(loss)                       1         (4)
Loss before income taxes                                    (1,322)   (1,053)
Income tax expense                                          12        16
Net loss                                                    ($1,334)  ($1,069)
Net loss per common share---basic                           ($0.06)   ($0.05)
Net loss per common share---diluted                         ($0.06)   ($0.05)
Weighted average number of common shares                    21,020    20,180
Weighted average number of common shares                    21,020    20,180

Urologix, Inc.
Balance Sheets
(Unaudited, in thousands)
                                                    September 30, June 30,
                                                     2013          2013
Current assets:                                                   
Cash                                                 $1,551        $2,290
Accounts receivable, net                             2,121         2,132
Inventories                                          2,017         1,952
Prepaids and other current assets                    388           128
Total current assets                                 6,077         6,502
Property and equipment:                                           
Property and equipment                               12,144        12,165
Less accumulated depreciation                        (11,508)      (11,430)
Property and equipment, net                          636           735
Other intangible assets, net                        1,534         1,587
Goodwill                                             3,036         3,036
Long-term inventories                                612           662
Other assets                                         5             5
Total assets                                         $11,900       $12,527
Current liabilities:                                              
Accounts payable                                     $1,113        $628
Accrued compensation                                 718           721
Deferred income                                      7             5
Short-term deferred acquisition payment              655           681
Other accrued expenses                               575           602
Total current liabilities                            3,068         2,637
Deferred tax liability                               43            36
Long-term deferred acquisition payment               4,153         4,026
Long-term debt                                       5,333         5,333
Other accrued liabilities                            65            75
Interest payable                                     84            -
Total liabilities                                    12,746        12,107
Shareholders' equity/(deficit):                                   
Common stock                                         208           208
Additional paid-in capital                           119,298       119,230
Accumulated deficit                                  (120,352)     (119,018)
Total shareholders' equity/(deficit)                 (846)         420
Total liabilities and shareholders' equity/(deficit) $11,900       $12,527

Urologix, Inc.
Condensed Statements of Cash Flows
(Unaudited, in thousands)
                                                            Year Ended
                                                             September 30,
                                                            2013     2012
Operating Activities:                                                
Net loss                                                     ($1,334) ($1,069)
Adjustments to reconcile net loss to net cash used for               
operating activities:
Depreciation and amortization                                157      172
Employee stock-based compensation expense                    68       58
Provision for bad debts                                      (19)     (12)
Accretion expense on deferred acquisition payments           110      170
Net adjustment to acquisition consideration                  (9)      (154)
Deferred income taxes                                        7        11
Change in operating items:                                           
Accounts receivable                                          30       48
Inventories                                                  (15)     (624)
Prepaids and other assets                                    (260)    (23)
Accounts payable                                             485      1,159
Accrued expenses and deferred income                         (38)     (150)
Interest payable                                             84       -
Net cash used for operating activities                       (734)    (414)
Investing Activities:                                                
Purchase of property and equipment                           (2)      (4)
Purchases of intellectual property                          (3)      (5)
Net cash used for investing activities                       (5)      (9)
Financing Activities:                                                
Issuance of common stock                                    -        3,873
Net cash provided by financing activities                    -        3,873
Net decrease in cash and cash equivalents                    (739)    3,450
Cash and cash equivalents:                                           
Beginning of period                                          2,290    1,899
End of period                                                $1,551   $5,349
Supplemental cash-flow information                                   
Income taxes paid during the period                          $12      $15
Net amount of inventory transferred to property and          $-      $56

CONTACT: Urologix Media Contact
         Karen Snay
         (513) 484-2987
         Urologix Investor Relations Contact
         Brian Smrdel
         (763) 475-7696

Urologix, Inc. Logo
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