Leonard Osser, CEO
Milestone Scientific Inc.
(973) 535-2717; (973) 535-2829 (Fax)
Web site: www.milesci.com
MILESTONE SCIENTIFIC ANNOUNCES THIRD QUARTER RESULTS
November 14, 2005
FOURTH CONSECUTIVE QUARTER OF INCREASED REVENUES
PRODUCT SALES RISE 41%, NET LOSS REDUCED BY 57%
LIVINGSTON, New Jersey, November 14, 2005 -- Milestone Scientific Inc. (AMEX: MS), which develops, manufactures, and markets computer controlled local anesthetic delivery systems, today announced its operating results for the third quarter and first nine months of 2005.
For the three months ended September 30, 2005, revenues increased 64% to approximately $1.8 million, including net product sales of $1,567,382, compared with net product sales of $1,110,043 in the third quarter of 2004. Royalty income from the Ionic White™ consumer tooth whitening system approximated $252,842, or 14% of total revenues, in the most recent quarter. Domestic sales of CompuDent® systems and handpieces rose 134%, or $209,347, and 28%, or $161,960, respectively, from the prior-year period. Gross profit for the quarter increased 110% to $1,146,457, versus $546,313 in the prior-year period. Gross profit margin improved to 63% of sales, compared with 49% 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 by 57% to ($612,375), or ($0.05) per share, compared with a net loss of ($1,083,176), or ($0.11) per share, in the third 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 a decline in international sales of CompuDent® units of $101,926, due to the termination of relationships with several under-performing sub-distributors. International sales of The Wand® disposable handpieces increased 135% to $273,353 in the third quarter of 2005, when compared with the prior-year period.
Selling, general and administrative expenses for the three months ended September 30, 2005 and 2004 totaled $1,738,286 and $1,608,176 respectively. The $130,110 increase included a $102,074, or 16%, increase in hiring and other employee expenses related to a continued investment in strengthening the Company’s domestic sales infrastructure, including sales commissions, and a $96,234, or 77%, increase in selling, marketing and advertising expenses. Legal fees increased by $89,514, or 67%, primarily due to litigation expenses related to the action against a competitor to the Ionic White™. Consulting expenses increased by $48,013, or 200%, due to the engagement of several consultants for market development services. These increases were partially offset by reductions in travel and stock-related expenses.
Research and development expenses increased to $53,678 in the most recent quarter, from $41,679 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 September 30, 2005, Milestone’s cash and cash equivalents approximated $3.7 million, and its working capital approximated $5.5 million.
“Domestic sales growth continues to gain momentum, reflecting our efforts to build an effective domestic sales force,” commented Leonard Osser, Chief Executive Officer of Milestone Scientific Inc. “We continue to see positive trends in our domestic sales and have begun to reduce operating expenses. Our expenses during the final months of 2005 will include increased costs associated with the planned filing of an application with the FDA regarding our CompuFlo medical injection technology, which we expect to play a key role in the Company’s growth in coming years.”
Revenues for the nine months ended September 30, 2005, increased 46% to approximately $4,954,068, compared with approximately $3,392,288 in the corresponding period of the previous year. Product sales rose 32% to $4,482,016, in the first nine months of 2005, versus $3,392,288 in the prior-year period. During the nine months ended September 30, 2005, the Company received $472,052 in royalties from sales of Ionic White, whereas there were no royalties in the year-earlier period.
The Company reported a net loss of ($2,281,108), or ($0.21) per share, in the first nine months of 2005, compared with a net loss of ($2,429,648), or ($0.27) per share, in the nine months ended September 30, 2004.
The Company will host a conference call on Tuesday November 15, 2005 at 11:00 a.m. EST to discuss third quarter results. The dial-in number for the conference call is 800-322-0079 (international/local participants dial 973-409-9258) and referencing the ID code 6716567. Parties interested in participating in the conference call should dial in approximately five minutes prior to 11:00 a.m. EST. A replay of the call will be available from November 15 through November 22, 2005 by dialing 877-519-4471 (international/local callers dial 973-341-3080), and entering the conference ID 6716567.
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”.
This press release contains forward-looking statements regarding the timing and financial impact of the 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 on Form 10-KSB for the year ended December 31, 2004. 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.