LIVINGSTON, NJ--(Marketwired - March 12, 2014) - Milestone Scientific Inc. (OTCQB: MLSS), a leading medical research and development company that designs and patents innovative injection technology, today announced financial results for the fourth quarter and year ended December 31, 2013.
2013 Operating Highlights:
- Formed a strategic partnership with Tri-anim Health Services Inc., a division of Sarnova Inc., one of the nation's largest specialty distributors of healthcare products, to distribute Milestone Medical's epidural instrument
- Listed Milestone Medical subsidiary on the Warsaw Stock Exchange and raised $3 million from European investors
- Implemented the use of the Wand® STA instrument in additional college and university dental hygienist programs
Leonard Osser, Chief Executive Officer of Milestone Scientific stated, "We are pleased to report positive financial results for the year ended December 31, 2013. We continue to see top and bottom line growth, with revenue increasing 15.8% to $10.0 million and net income increasing to $1.5 million for 2013, compared to a net loss of approximately ($870,306) in 2012. Notably, we achieved a 44.8% increase in domestic instrument sales to $1.2 million in 2013. At the same time, our balance sheet continues to improve as we increased shareholders' equity to $5.5 million as of December 31, 2013. The improvement in shareholders' equity was principally attributable to the increase in net income, conversion of a long term note, and a small private placement in 2013."
"We continue to maintain a successful distribution relationship with Aseptico, which provides us greater transparency with our customers. As a result, we are able to establish a direct relationship with dentists and provide them with a training program through our in-house education staff as well as our hygienists in the field to make an effort to have them use the instrument to the fullest capacity. Due to certain sales incentives and arrangements with our distributors, we anticipate lower handpiece sales in the first quarter and second quarter of 2014 as compared to the fourth quarter of 2013. However, we expect to more than make up for this decline in the second half of 2014 since we know from experience that once we train dentists, they utilize a greater number of handpieces each year. We are also implementing promotions and incentives on the Wand® STA instruments in 2014 to our distributors worldwide which should increase instrument sales. The increase in instrument sales will help drive handpiece sales beginning in the second half of 2014, which will result in increased sales and increased bottom line but lower margins.
"In 2013, we announced a strategic partnership with Tri-anim Health Services Inc., one of the nation's largest specialty distributors of healthcare products. Upon FDA approval, Tri-anim will be the exclusive distributer of Milestone Medical's epidural instrument. Tri-anim is one of the largest distributors to birthing hospitals across the U.S., and is an important validation of the market potential for our instruments."
"Lastly, our subsidiary, Milestone Medical Inc., recently listed on the Warsaw Stock Exchange. The listing followed a $3 million raise from European investors. The money we raised in Poland will help us accelerate the launch of our first two medical instruments, epidural and intra-articular, which are based on our patented Dynamic Pressure Sensing® system. We believe these first two medical instruments represent a significant market opportunity for both Milestone Medical Inc. and Milestone Scientific Inc. We look forward to introducing additional instruments serving a wide array of medical applications, and believe this recent funding demonstrates our ability to cost-effectively bring new instruments to market, while minimizing dilution to shareholders."
Revenue for the three months ended December 31, 2013 increased 23.3% to $2.8 million versus $2.3 million for the fourth quarter of 2012. Domestic instrument sales increased by 30.9% to $378,801 in the fourth quarter of 2013 versus the same quarter in 2012 due to the increased demand at the distributor and group dental practice levels. In the domestic market, handpiece sales increased by $211,547 or 27.3%. On the international front, total revenue was $1,407,455, a 18.9% increase versus the same period in 2012. International handpiece sales increased by $166,973 or 20.6% in the fourth quarter of 2013 versus 2012. Gross profit for the fourth quarter of 2013 was $1.8 million or 65.5% of revenue versus $1.4 million or 59.8% of revenue in the fourth quarter of 2012. Net income for the fourth quarter of 2013 was $1.0 million, or $0.05 per diluted share, versus net loss of ($365,735), or ($0.02) per diluted share for the comparable period in 2012.
Revenue for the year ended December 31, 2013 increased 15.8% to $10.0 million versus $8.6 million for the year ended 2012. The increase in product sales of $1,363,178 was primarily the result of increased domestic revenue. Domestic instrument sales increased by $377,752 or 44.8% in 2013 versus 2012 due to increased demand at the distributor and group dental practice levels. In the domestic market, handpiece sales increased by $561,355 or 16.5%. International instrument sales increased by $147,517 or 11.3% in 2013 versus 2012. In the international market, handpiece sales increased by $389,434 or 13.2%. Gross profit for 2013 was $6.8 million or 68.0% of revenue versus $5.6 million or 64.7% of revenue in 2012. Operating income for 2013 was $1.1 million versus operating loss of ($520,353) for 2012. Net income for 2013 was $1.5 million or $0.08 per diluted share, versus net loss of ($870,306), or ($0.05) per diluted share in 2012. The increase in net income is attributable to an increase in sales and gross margin dollars, as well as a significant decrease in selling, general and administrative expenses and the net positive impact of Milestone Medical Inc. (joint venture).
Milestone's executive management team will host a teleconference on Thursday, March 13th
at 8:30am Eastern Daylight Time to discuss the company's financial results. The conference call can be accessed via telephone by dialing toll free 1-877-941-9205. For those unable to participate at that time, a replay of the call can be accessed by dialing 1-800-406-7325 and entering the pass code 4673676. The replay will be available for 90 days.
About Milestone Scientific Inc.
Milestone Scientific Inc. (MLSS) is a leading medical research and development company that designs and patents innovative injection technology. Milestone's computer-controlled systems make injections precise, efficient, and virtually painless. For more information please visit our website: www.milestonescientific.com
Safe Harbor Statement
This press release contains forward-looking statements regarding the timing and financial impact of Milestone's ability to implement its business plan, expected revenues and future success. These statements involve a number of risks and uncertainties and are based on assumptions involving judgments with respect to future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond Milestone's control. Some of the important factors that could cause actual results to differ materially from those indicated by the forward-looking statements are general economic conditions, failure to achieve expected revenue growth, changes in our operating expenses, adverse patent rulings, FDA or legal developments, competitive pressures, changes in customer and market requirements and standards, and the risk factors detailed from time to time in Milestone's periodic filings with the Securities and Exchange Commission, including without limitation, Milestone's Annual Report for the year ended December 31, 2013. The forward looking-statements in this press release are based upon management's reasonable belief as of the date hereof. Milestone undertakes no obligation to revise or update publicly any forward-looking statements for any reason.
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| MILESTONE SCIENTIFIC INC. |
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| CONDENSED STATEMENTS OF OPERATIONS |
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| (Unaudited) |
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| December 31, 2013 |
| | December 31, 2012 |
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| Product sales, net |
| $ | 10,011,420 |
| | $ | 8,648,242 |
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| Cost of products sold |
| | 3,198,908 |
| | | 3,055,991 |
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| Gross profit |
| | 6,812,512 |
| | | 5,592,251 |
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| Selling, general and administrative expenses |
| | 5,534,463 |
| | | 5,930,625 |
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| Research and development expenses |
| | 191,345 |
| | | 181,979 |
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Total operating expenses |
| | 5,725,808 |
| | | 6,112,604 |
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| Income (loss) from operations |
| | 1,086,704 |
| | | (520,353 |
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| Other income (expense) |
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Other income |
| | 17,543 |
| | | - |
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Interest income |
| | 115 |
| | | 34 |
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Interest expense |
| | (70,801 |
) | | | (175,905 |
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Interest-Amortized debt issuance - cost |
| | - |
| | | (3,065 |
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Loss on Earnings from Medical Joint Venture |
| | (924,363 |
) | | | (171,016 |
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Loss on Earnings from Education Joint Venture |
| | (7,918 |
) | | | - |
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Gain on dilutive effect on Medical Joint Venture stock issuance |
| | 1,363,650 |
| | | - |
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| Total other expense, net |
| | 378,226 |
| | | (349,952 |
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| | Income (loss) |
| | 1,464,930 |
| | | (870,306 |
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| Provision for Income Tax |
| | - |
| | | - |
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| | Net income (loss) |
| $ | 1,464,930 |
| | $ | (870,306 |
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| Net income (loss) per share applicable to common stockholders - |
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Basic |
| $ | 0.09 |
| | $ | (0.05 |
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Diluted |
| $ | 0.08 |
| | $ | (0.05 |
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| Weighted average shares outstanding and to be issued - |
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Basic |
| | 17,127,468 |
| | | 16,080,474 |
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Diluted |
| | 17,483,638 |
| | | 16,080,474 |
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| MILESTONE SCIENTIFIC INC. |
| CONDENSED BALANCE SHEETS |
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| December 31, 2013 |
| | December 31, 2012 |
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| ASSETS |
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| Current Assets: |
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Cash and cash equivalents |
| $ | 1,147,198 |
| | $ | 165,249 |
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Accounts receivable, net of allowance for doubtful accounts of $5,000 in 2013 and $179,259 in 2012 |
| | 1,532,856 |
| | | 978,982 |
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Inventories |
| | 1,321,652 |
| | | 638,561 |
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Advances on contracts |
| | 727,478 |
| | | 476,969 |
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Prepaid expenses and other current assets |
| | 150,451 |
| | | 239,061 |
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| Total current assets |
| | 4,879,635 |
| | | 2,498,822 |
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| Accounts receivable-long term, net of allowance for doubtful accounts |
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| of $167,971 in 2012 |
| | - |
| | | 119,201 |
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| Advances on contracts |
| | 1,580,874 |
| | | 2,350,477 |
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| Investment in Milestone Medical Inc |
| | 924,115 |
| | | - |
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| Investment in Milestone Education LLC |
| | 42,082 |
| | | - |
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| Furniture, Fixtures & Equipment net of accumulated depreciation of $476,884as of December 31, 2013 and $458,708 as of December 31, 2012 |
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23,988
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36,624
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| Patents, net of accumulated amortization of $498,502 as of December 31, 2013 and $420,556 as of December 31, 2012 |
| | 591,735 |
| | | 648,662 |
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| Other assets |
| | 12,917 |
| | | 7,317 |
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| | Total assets |
| $ | 8,055,346 |
| | $ | 5,661,103 |
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| LIABILITIES AND STOCKHOLDERS' EQUITY |
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| Current Liabilities: |
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Accounts payable |
| $ | 2,020,368 |
| | $ | 2,336,594 |
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Accrued expenses and other payable |
| | 515,132 |
| | | 581,407 |
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Accrued interest on Notes Payable |
| | - |
| | | 356,563 |
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| Total current liabilities |
| | 2,535,500 |
| | | 3,274,564 |
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| Long-term Liabilities: |
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Notes payable |
| | - |
| | | 450,000 |
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| Total long-term liabilities |
| | - |
| | | 450,000 |
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| Commitments and Contingencies |
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| Stockholders' Equity |
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Preferred Stock, par value $.001, 5,000,000 shares |
| | - |
| | | - |
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Common stock, par value $.001; authorized 50,000,000 shares; 17,759,540 shares issued 1,839,930 shares to be issued and 17,726,207 shares outstanding as of December 31, 2013; 16,563,306 shares issued 1,635,709 shares to be issued and 16,529,973 shares out |
| | 19,599 |
| | | 18,199 |
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Additional paid-in capital |
| | 66,677,200 |
| | | 64,560,224 |
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Accumulated deficit |
| | (60,265,438 |
) | | | (61,730,368 |
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Treasury stock, at cost, 33,333 shares |
| | (911,516 |
) | | | (911,516 |
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| Total stockholders' equity |
| | 5,519,846 |
| | | 1,936,539 |
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| | Total liabilities and stockholders' equity |
| $ | 8,055,346 |
| | $ | 5,661,103 |
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