Stereotaxis Reports 2013 Fourth Quarter and Full Year Financial Results

Stereotaxis Reports 2013 Fourth Quarter and Full Year Financial Results

                -Announces Distribution Partnership in Japan-

            -Significantly Increases Working Capital by Year End-

         -Reduces Cash Burn for FY2013 to Record Low of $6.3 Million-

     -Achieves Lowest Reported Full Year Operating Loss of $8.8 Million-

              -Reconfirms Commitment to Technology Advancements-

           -Hosts Conference Call Today at 4:30 p.m. Eastern Time-

ST. LOUIS, Feb. 25, 2014 (GLOBE NEWSWIRE) -- Stereotaxis, Inc. (Nasdaq:STXS)
today reported financial results for the fourth quarter and full year ended
December 31, 2013.

Management Comments

"We are very encouraged by the health of Stereotaxis today – leaner,
financially stronger and poised to further revolutionize the delivery of care
in the electrophysiology (EP) catheter laboratory," said William C. Mills,
Stereotaxis Chief Executive Officer. "Over the course of 2013, we effectively
transformed our balance sheet, raising $21.9 million in new, permanent capital
and eliminating short-term debt obligations, which reduced the principal of
our total debt by $17.1 million. At the same time, we continued to demonstrate
intelligent capital stewardship during the year, reporting the lowest full
year cash burn and operating loss since our initial public offering in 2004."

Mr. Mills continued, "While we were challenged to achieve targeted top line
results in 2013, we believe we have significant growth opportunities ahead. As
we announced today, we have completed an agreement with two strong,
experienced Japanese companies to begin immediate commercialization of our
Niobe® technology in Japan. Furthermore, enthusiasm around our Vdrive™ with
V-Sono™ ICE catheter manipulator continues to build in the U.S., the result of
strategic, customer-centric capital selling and clinical adoption efforts.

"A firmer financial footing enables us to redirect our energies to meaningful
technological innovations that not only will lead the EP market in safety and
operator efficiencies, but will deliver the highest quality patient outcomes
possible, which is our ultimate goal. I am proud to lead an organization of
enormously dedicated, creative people and am confident in the inherent
strengths of our robotic platform to illuminate a path for the future of
interventional cardiac electrophysiology."

Fourth Quarter Financial Results

Revenue for the fourth quarter of 2013 totaled $9.1 million, compared to $12.2
million in the prior year fourth quarter, a 25.7% decline. System revenue was
$2.7 million, compared to $5.6 million in the 2012 fourth quarter. The Company
recognized revenue of $2.3 million on three Niobe ES systems and one ES
upgrade, $0.1 million on one Vdrive system and $0.3 million in Odyssey® system
sales in the fourth quarter 2013. Recurring revenue was $6.3 million in the
quarter compared to $6.6 million in the prior year fourth quarter. Procedures
declined 11% from the same quarter last year but improved 5% sequentially.

The Company generated new capital orders of $3.9 million, which includes three
Niobe ES orders, one ES upgrade, three Vdrive orders and three Odyssey system
orders, compared to $4.2 million in the fourth quarter of 2012. Ending capital
backlog for the 2013 fourth quarter was $6.8 million.

Gross margin in the quarter was $6.2 million, or 68.7% of revenue, versus $7.9
million, or 65.0% of revenue, in the fourth quarter of 2012. Operating
expenses in the fourth quarter were $8.7 million compared to $8.8 million in
the prior year quarter.

Operating loss in the fourth quarter was $(2.4) million, compared to $(0.9)
million in the prior year quarter. Interest expense improved to $0.9 million
from $2.0 million in the fourth quarter of 2012 with the extinguishment of the
Company's convertible debentures.

The net loss for the 2013 fourth quarter was $(4.0) million, or $(0.23) per
share, compared to a net loss of $(4.3) million, or $(0.55) per share,
reported in the fourth quarter of 2012. Excluding mark-to-market warrant
revaluation and amortization of convertible debt discount, the fourth quarter
2013 adjusted net loss would have been $(3.3) million, or $(0.19) per share,
and the fourth quarter 2012 adjusted net loss would have been $(2.3) million,
or $(0.29) per share. The weighted average diluted shares outstanding for the
fourth quarters of 2013 and 2012 totaled 17.2 million and 7.8 million,
respectively.

Cash burn for the fourth quarter of 2013 was $1.4 million, compared to $0.1
million for the fourth quarter of 2012. 

Full Year Financial Results

Revenue for the full year ended December 31, 2013 was $38.0 million compared
to $46.6 million for the full year 2012. System revenue in 2013 was $12.7
million on nine Niobe ES system sales, and recurring revenue was $25.3
million. This compares to $19.7 million and $26.9 million for system and
recurring revenues, respectively, during 2012. Utilization companywide
declined 11% compared to last year. 

Gross margin in the full year 2013 was $27.0 million, or 71% of revenue,
compared with $31.8 million, or 68% of revenue, in 2012. Operating expenses
for 2013 were $35.9 million, a 15% reduction compared to $42.4 million in
2012.

Operating loss was $(8.8) million, the lowest full year operating loss
reported since the Company's initial public offering in 2004 and a 16.8%
improvement from the prior year.

Interest expense in full year 2013 increased to $12.6 million, compared to
$6.9 million in the prior year, primarily related to a one-time, non-cash
expense in the third quarter as a result of the extinguishment of the
Company's convertible debt.

The 2013 full year results included $53.9 million of charges reported as other
expense and interest expense, related to a non-cash, mark-to-market adjustment
and amortization of convertible debt discount as a result of transactions with
convertible note holders and other equity investors. Including these charges,
the net loss for the full year 2013 was $(68.8) million, or $(5.95) per share,
compared to a net loss of $(9.2) million, or $(1.33) per share, reported for
full year 2012. Excluding these charges, the net loss for 2013 would have been
$(14.9) million, or $(1.29) per share. Excluding the mark-to-market warrant
revaluation and amortization of convertible debt discount related to $18.5
million in financing in 2012, the net loss for 2012 would have been $(16.5)
million, or $(2.38) per share.

Cash burn for 2013 was $6.3 million, compared to $12.2 million in the prior
year, a 48% reduction and the lowest annual reported cash burn since the
Company went public.

Financial Position

At December 31, 2013, Stereotaxis had cash and cash equivalents of $13.8
million, compared to $8.4 million at September 30, 2013. During the fourth
quarter, the Company received gross proceeds of approximately $10.2 million as
a result of a subscription rights offering. At year-end, total debt was $18.5
million related to HealthCare Royalty Partners debt. The Company significantly
strengthened its balance sheet during the year, improving its cash position by
$6 million and eliminating $17.1 million of the principal on total debt since
December 31, 2012.

Clinical Update

In January 2014, the Company announced it had completed the clinical trial of
its Vdrive™ with V-Loop™ Circular Catheter Manipulator. Results of the
120-patient study, which was conducted at three hospitals in the U.S. and two
in Europe, will be included in a 510(k) Premarket Notification the Company
intends to submit to the U.S. FDA in the first quarter of 2014.

Conference Call and Webcast

Stereotaxis will host a conference call and webcast today, February 25, 2014,
at 4:30 p.m. Eastern Time, to discuss fourth quarter and full year results.
The dial-in number for the conference call is 1-877-941-1427 for domestic
participants and 1-480-629-9664 for international participants.Participants
are asked to call the above numbers 5-10 minutes prior to the start time. To
access the live and replay webcast, please visit the investor relations
section of the Stereotaxis website at www.stereotaxis.com.

About Stereotaxis

Stereotaxis is a healthcare technology and innovation leader in the
development of robotic cardiology instrument navigation systems designed to
enhance the treatment of arrhythmias and coronary disease, as well as
information management solutions for the interventional lab. Over 100 issued
patents support the Stereotaxis platform, which helps physicians around the
world provide unsurpassed patient care with robotic precision and safety,
improved lab efficiency and productivity, and enhanced collaboration of
life-saving information. Stereotaxis' core Epoch™ Solution includes the Niobe®
ES Remote Magnetic Navigation system, the Odyssey® portfolio of lab
optimization, networking and patient information management systems and the
Vdrive™ Robotic Mechanical Navigation system and consumables.

The core components of Stereotaxis systems have received regulatory clearance
in the U.S., European Union, Canada, China and elsewhere. The V-Sono™ ICE
catheter manipulator has received U.S. clearance, and the V-Loop™ circular
catheter manipulator will soon be submitted for review by the U.S. Food and
Drug Administration. For more information, please visit www.stereotaxis.com

This press release includes statements that may constitute "forward-looking"
statements, usually containing the words "believe," "estimate," "project,"
"expect" or similar expressions. Forward-looking statements inherently involve
risks and uncertainties that could cause actual results to differ materially
from the forward-looking statements. Factors that would cause or contribute to
such differences include, but are not limited to, the Company's ability to
raise additional capital on a timely basis and on terms that are acceptable,
its ability to continue to manage expenses and cash burn rate at sustainable
levels, its ability to continue to work with lenders to extend, repay or
refinance indebtedness on acceptable terms, continued acceptance of the
Company's products in the marketplace, the effect of global economic
conditions on the ability and willingness of customers to purchase its systems
and the timing of such purchases, the outcome of various shareholder
litigation filed against Stereotaxis, competitive factors, changes resulting
from the recently enacted healthcare reform in the U.S., including changes in
government reimbursement procedures, dependence upon third-party vendors,
timing of regulatory approvals, and other risks discussed in the Company's
periodic and other filings with the Securities and Exchange Commission. By
making these forward-looking statements, the Company undertakes no obligation
to update these statements for revisions or changes after the date of this
release. There can be no assurance that the Company will recognize revenue
related to its purchase orders and other commitments in any particular period
or at all because some of these purchase orders and other commitments are
subject to contingencies that are outside of the Company's control. In
addition, these orders and commitments may be revised, modified, delayed or
canceled, either by their express terms, as a result of negotiations, or by
overall project changes or delays.

STEREOTAXIS, INC.
BALANCE SHEETS
(Unaudited)

                                                December 31,   December 31,
                                                 2013           2012
                                                (Unaudited)    
Assets                                                         
Current assets:                                                
Cash and cash equivalents                        $13,775,130  $7,777,718
Accounts receivable, net of allowance of
$383,077 and $640,183 in 2013 and 2012,          7,558,152     11,570,489
respectively
Inventories                                      4,879,039     5,098,241
Prepaid expenses and other current assets        1,945,206     3,492,067
Total current assets                             28,157,527    27,938,515
Property and equipment, net                      1,184,589     2,141,923
Intangible assets, net                           1,679,486     1,979,320
Long-term receivables                            20,431        73,199
Other assets                                     34,363        32,987
Total assets                                     $31,076,396  $32,165,944
                                                              
Liabilities and stockholders' equity (deficit)                 
Current liabilities:                                           
Current maturities of long-term debt             $49,733      $12,264,490
Accounts payable                                 3,512,339     3,556,688
Accrued liabilities                              7,079,381     5,361,810
Deferred contract revenue                        7,519,754     9,502,939
Warrants                                         5,644,626     2,968,348
Total current liabilities                        23,805,833    33,654,275
                                                              
Long-term debt, less current maturities          18,481,478    16,824,736
Long-term deferred contract revenue              491,080       477,159
Other liabilities                                --           --
                                                              
Stockholders' equity (deficit):                                
Preferred stock,par value $0.001; 10,000,000
shares authorized, none outstanding at 2013 and  --           --
2012
                                                              
Common stock, par value $0.001; 300,000,000
shares authorized, 19,311,390 and 8,018,615      19,311        8,019
shares issued at 2013 and 2012, respectively
Additional paid-in capital                       441,888,155   366,053,627
Treasury stock, 4,015 shares at 2013 and 2012    (205,999)     (205,999)
Accumulated deficit                              (453,403,462) (384,645,873)
Total stockholders' equity (deficit)             (11,701,995)  (18,790,226)
Total liabilities and stockholders' equity       $31,076,396  $32,165,944
(deficit)


STEREOTAXIS, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
                                                            
                 Three Months Ended            Twelve Months Ended
                  Dec 31,                       Dec 31,
                 2013           2012           2013            2012
                                                            
Revenue                                                      
System            $2,742,292   $5,590,346   $12,743,218   $19,672,983
Disposables,
service and       6,325,734     6,614,563     25,287,863     26,889,451
accessories
Total revenue     9,068,026     12,204,909    38,031,081     46,562,434
                                                            
Cost of revenue                                              
System            1,738,947     2,957,383     6,870,954      9,905,528
Disposables,
service and       1,098,197     1,314,942     4,130,347      4,875,527
accessories
Total cost of     2,837,144     4,272,325     11,001,301     14,781,055
revenue
                                                            
Gross margin      6,230,882     7,932,584     27,029,780     31,781,379
                                                            
Operating                                                    
expenses:
Research and      1,358,468     1,479,158     5,672,058      8,405,086
development
Sales and         3,918,565     4,289,088     17,132,093     20,607,999
marketing
General and       3,377,987     3,044,739     13,066,103     13,394,556
administration
Total operating   8,655,020     8,812,985     35,870,254     42,407,641
expenses
Operating loss    (2,424,138)   (880,401)     (8,840,474)    (10,626,262)
                                                            
Other income      (689,038)     (1,414,341)   (47,349,378)   8,265,507
(expense)
Interest income   1,827         2,008         5,800          7,361
Interest expense  (850,859)     (2,023,927)   (12,573,537)   (6,885,033)
Net loss          $(3,962,208) $(4,316,661) $(68,757,589) $(9,238,427)
                                                            
Net loss per                                                 
common share:
Basic             $(0.23)      $(0.55)      $(5.95)       $(1.33)
Diluted           $(0.23)      $(0.55)      $(5.95)       $(1.33)
                                                            
Weighted average
shares used in
computing net                                                
loss per common
share:
Basic            17,235,096    7,819,563     11,554,566     6,944,928
Diluted          17,235,096    7,819,563     11,554,566     6,944,928

CONTACT: Company Contact:
         Marty Stammer
         Chief Financial Officer
         314-678-6155
        
         Investor Contact:
         Todd Kehrli / Jim Byers
         MKR Group, Inc.
         323-468-2300
         stxs@mkr-group.com

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