SEC Filings
Leonard Osser, Chairman and CEO
MILESTONE SCIENTIFIC ANNOUNCES SECOND QUARTER RESULTS
August 15, 2005
GROSS PROFIT INCREASES 165% TO MORE THAN $1.1 MILLION ON HIGHER DOMESTIC COMPUDENT® SALES
LIVINGSTON, New Jersey, August 15, 2005 -- Milestone Scientific Inc. (AMEX: MS), which develops, manufactures, and markets computer controlled local anesthetic delivery systems, today announced its operating results for the second quarter and first half of 2005.
For the three months ended June 30, 2005, revenues increased 41% to $1,675,941, including net product sales of $1,456,731, compared with net product sales of $1,188,022 in the second quarter of 2004. Royalty income from the Ionic White™ consumer tooth whitening system approximated $219,000, or 13% of total revenues, in the quarter. Domestic sales of CompuDent systems rose 165%, or $234,944, from the prior-year period. Gross profit for the quarter increased 165% to $1,111,032, versus $418,639 in the prior-year period. Gross profit margin improved to 66% of sales, compared with 35% in the 2004 quarter, primarily due to increased domestic CompuDent® sales, which generate a higher gross profit margin than international sales. Net loss for the quarter was reduced to ($789,790), or ($0.07) per share, compared with a net loss of ($827,678), or ($0.09) per share, in the second quarter of 2004.
Continued growth in domestic CompuDent® unit sales reflects Milestone’s investment in new sales and marketing initiatives during the past twelve months. Domestic sales increases were partially offset by an international sales decrease of 16% to $334,838 in the most recent quarter, due to the termination of relationships with several under-performing sub-distributors. Domestic sales of The Wand® disposable handpieces increased 5% in the second quarter of 2005, when compared with the prior-year period.
Selling, general and administrative expenses for the three months ended June 30, 2005 and 2004 totaled $1,854,562 and $1,211,917 respectively. The $642,645 increase included a $218,691, or 54 % increase in hiring and other employee expenses related to the continued investment in strengthening the Company’s domestic sales infrastructure, including sales commissions and a $113,921 or 101% increase in selling, marketing and advertising expenses. Legal fees increased by $71,207, or 46%, primarily due to patent filings associated with new product development. Professional fees for consulting services increased $140,941, primarily due to non-cash charges related to the vesting of certain stock options. Other professional fees increased $78,044, or 129% primarily the result of continue work on Sarbanes-Oxley compliance.
Research and development expenses increased to $69,844 in the most recent quarter, from $52,409 in the prior-year period, as Milestone continued to invest in the development of its Ionic White™ and CoolBlue™ tooth whitening systems and CompuFlo technology.
As of June 30, 2005, Milestone’s cash and cash equivalents approximated $4.5 million, and its working capital approximated $5.9 million.
“Our improved quarterly results reflect the initial success of a substantial investment in domestic sales and marketing infrastructure during the past year”, stated Leonard Osser, Chairman and Chief Executive Officer of the Company. “We are encouraged by our positive sales trends and expanding gross margins. The profitability of our Dental business, along with royalties from the sale of Ionic White tooth whitening systems, should allow us to accelerate our efforts to commercialize our CompuFlo technology for new medical applications. We continue to believe that CompuFlo has the potential to significantly enhance the safety of local anesthetic injections in medical procedures with substantial revenue potential. We have initiated conversations with potential strategic partners, and it is our goal to request approval from the FDA to market CompuFlo for epidural anesthetic injections before year end.”
“A highlight of our third quarter will involve the anticipated formal market introduction of our Cool Blue professional tooth whitening system at the California Dental Association Fall Session show in San Francisco in September,” continued Osser. “We believe Cool Blue will offer dentists significant cost savings and productivity enhancements relative to competitive products and allow Milestone to target a meaningful share of the fast growing global professional tooth whitening market.”
The Company will host a conference call on Tuesday August 16, 2005 at 11:00 a.m. EDT to discuss second quarter results. The dial-in number for the conference call is 800-322-0079 (international/local participants dial 973-409-9258). Parties interested in participating in the conference call should dial in approximately five minutes prior to 11:00 a.m. EDT. A replay of the call will be available through August 23, 2005 by dialing 877-519-4471 (international/local callers dial 973-341-3080), and the replay Access Code is 6368701.
About Milestone Scientific Inc.
Milestone Scientific is the developer, manufacturer and marketer of CompuMed® and CompuDent® computer controlled local anesthetic delivery systems. These systems comprise a microprocessor controlled drive unit as well as The Wand® handpiece, a single patient use product that is held in a pen-like manner for injections. The Company also sells the SafetyWand®, which incorporates engineered sharps injury protection features to aid in the prevention of accidental needlesticks. Milestone has also developed proprietary consumer (Ionic White) and professional (Cool Blue) teeth whitening systems that were introduced to the market in early 2005.
In 2001, Milestone Scientific received broad United States patent protection on an enabling technology for computer controlled, pressure sensitive infusion, perfusion, suffusion and aspiration, which provides real time displays of pressures, fluid densities and flow rates, that advances the delivery and removal of a wide array of fluids. Development of this CompuFlo technology is currently underway.
The Company is headquartered in Livingston, New Jersey, and its common stock trades on the American Stock Exchange under the symbol “MS”.