Milestone Scientific Provides Business Update for the Second Quarter of 2018
5:11 pm ET August 14, 2018 (Dow Jones) Print
Milestone Scientific Provides Business Update for the Second Quarter of 2018
LIVINGSTON, N.J., Aug. 14, 2018 (GLOBE NEWSWIRE) -- Milestone Scientific Inc. (NYSE: MLSS), a leading developer of computerized drug delivery instruments that provide painless and precise injections, today provided a business update and announced financial results for the second quarter and six months ending June 30, 2018.
Leonard Osser, Interim Chief Executive Officer of Milestone Scientific, commented, "We continue to focus on commercial efforts around the CompuFlo(R) Epidural system. During the second quarter we expanded our network to eight independent distributors covering key markets across the U.S., including the Pacific Northwest, Southeast, Southwest, Midwest, Northwest and Mid-Atlantic regions. We believe our rapid progress is due to our new decentralized sales strategy, whereby we are targeting independent distributors with existing physician and hospital relationships within their respective territories and clinical specialties."
"Last month, we announced that the CompuFlo(R) Epidural System was featured in a prominent peer-reviewed scientific journal. The CompuFlo(R) Epidural System was selected to objectively measure and evaluate the integrity of a third-party epidural simulator. We believe this further illustrates that CompuFlo(R) is becoming accepted as best-in-class for its ability to measure tissue density and accurately identify the tip of the needle in real time."
"We experienced some weakness within our dental division in the second quarter of 2018 due to advance purchases in both China and the U.S. late last year, as well as a manufacturing delay, which has since been resolved. Nevertheless, we did see an increase of approximately 66% in international dental revenue, excluding China, for the second quarter of 2018 versus the same period last year. We anticipate some continued lumpiness in the dental business quarter-to-quarter, due to the timing of orders, but overall, we anticipate our dental division will continue to generate steady growth and maintain solid margins."
Revenue for the three months ended June 30, 2018 was $2.4 million versus $2.5 million for the second quarter of 2017. Domestic sales decreased by approximately $231,000 in 2018. The decrease in revenue was due in part to advanced purchases from Henry Schein in the fourth quarter of 2017, in anticipation of a planned price increase in 2018. Additionally, total revenues during the three months ended June 30, 2018 did not include sales to Milestone China, compared to approximately $356,000 in sales to Milestone China for the three months ended June 30, 2017. International dental revenue excluding China increased approximately $492,000 for the three months ended June 30, 2018 compared to the same period in 2017. Gross profit for the second quarter of 2018 was $1.4 million or 58% of revenue versus $1.7 million or 65% of revenue in the second quarter of 2017. Net loss applicable to common stockholders for the second quarter of 2018 was $(1.3) million, or $(0.04) per share, versus net loss applicable to common stockholders of $(1.5) million, or $(0.05) per share, for the comparable period in 2017.
Revenue for the six months ended June 30, 2018 was $4.2 million versus $6.2 million for the second quarter of 2017. Domestic dental revenue decreased approximately $1.0 million during the six months ended June 30, 2018 as compared to the same period in 2017, of which, approximately $1 million was related to the advanced purchases from Henry Schein in the fourth quarter of 2017. Additionally, total revenues during the six months ended June 30, 2018 did not include sales to Milestone China, compared to approximately $1.4 million in sales to Milestone China for the six months ended June 30, 2017. International dental revenue excluding China increased approximately $407,000 for the six months ended June 30, 2018, compared to the same period in 2017. Gross profit for the first six months of 2018 was $2.6 million or 63% of revenue versus $3.9 million or 63% of revenue in the first six months of 2017. Net loss applicable to common stockholders for the first six months of 2018 was $(3.2) million, or $(0.09) per share, versus net loss applicable to common stockholders of $(2.0) million, or $(0.06) per share, for the comparable period in 2017.
Conference Call
Milestone Scientific's executive management team will host a conference call at 8:30 AM Eastern Time on Wednesday, August 15, 2018 to discuss the Company's financial results for the second quarter ended June 30, 2018, as well as the Company's corporate progress and other developments.
The conference call will be available on the Company's website at www.milestonescientific.com, or via telephone by dialing toll free 800-263-0877 and entering the pass code: 9671500. For those unable to participate at that time, a replay of the call will be archived on the company's website or can be accessed by dialing 888-203-1112 and entering the pass code 9671500. The replay will be available for 90 days.
About Milestone Scientific Inc.
Milestone Scientific Inc. (MLSS) is a biomedical technology research and development company that patents, designs, develops and commercializes innovative diagnostic and therapeutic injection technologies and instruments for medical, dental, cosmetic and veterinary applications. Milestone's computer-controlled systems are designed to make injections precise, efficient, and virtually painless. Milestone's proprietary DPS Dynamic Pressure Sensing technology(R) is our technology platform that advances the development of next-generation devices, regulating flow rate and monitoring pressure from the tip of the needle, through platform extensions for local anesthesia for subcutaneous drug delivery, with specific applications for cosmetic botulinum toxin injections, epidural space identification in regional anesthesia procedures and intra-articular joint injections. 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, timing of regulatory approvals 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, future business decisions and regulatory developments, 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, 2017. 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.
MILESTONE SCIENTIFIC INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS June 30, 2018 December 31, 2017
(Unaudited) (Audited)
----------- --------------
Current Assets:
Cash and cash equivalents $ 865,654 $ 2,636,956
Accounts receivable, net 1,840,145 1,535,513
Accounts receivable, from
related party 2,817,990 1,725,450
Note receivable from
financing transaction,
current - 500,000
Prepaid expenses and other
current assets 484,753 436,410
Deferred cost, related party 1,796,036 1,109,671
Inventories, net 2,310,330 3,379,209
Advances on contracts 861,782 697,192
Total current assets 10,976,690 12,020,401
Furniture, fixtures &
equipment, net 105,529 141,760
Patents, net 2,320,392 2,789,748
Note receivable from
financing transaction,
noncurrent - 650,000
Other assets 26,878 26,878
Total assets 13,429,489 15,628,787
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current Liabilities:
Accounts payable $ 1,365,491 $ 853,859
Accounts payable, related
party 1,352,802 1,109,442
Accrued expenses and other
payables 1,937,571 2,287,908
Deferred profit, related
party 636,126 751,500
Deferred revenue, related
party 2,817,990 1,725,450
Total current liabilities 8,109,980 6,728,159
Deferred gain from financing
transaction - 1,400,000
Total liabilities $ 8,109,980 $ 8,128,159
Commitments and Contingencies
Stockholders' Equity
Series A convertible
preferred stock, par value
$.001, authorized 5,000,000
shares, and 7,000 shares
issued and outstanding as of
June 30, 2018 and December
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31, 2017 $ 7 $ 7
Common stock, par value
$.001; authorized 50,000,000
shares; 33,660,970 shares
issued, 1,912,503 shares to
be issued and 33,627,637
shares outstanding as of
June 30, 2018; 33,191,571
shares issued, 1,401,247
shares to be issued and
33,158,238 shares
outstanding as of December
31, 2017; 35,571 34,593
Additional Paid in Capital 87,832,358 86,689,084
Accumulated deficit (81,784,998) (78,568,284)
Treasury stock, at cost,
33,333 shares (911,516) (911,516)
Total Milestone Scientific Inc.
stockholders' equity 5,171,422 7,243,884
Noncontrolling interest 148,087 256,744
Total stockholders' equity 5,319,509 7,500,628
Total liabilities and
stockholders' equity $ 13,429,489 $ 15,628,787
MILESTONE SCIENTIFIC INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended June
30, Six Months Ended June 30,
2018 2017 2018 2017
Product sales, net $ 2,428,498 $ 2,523,750 $ 4,234,103 $ 6,212,738
Cost of products
sold 1,021,573 873,586 1,584,250 2,275,871
Gross profit 1,406,925 1,650,164 2,649,853 3,936,867
Selling,
general and
administrative
expenses 2,821,837 3,082,534 5,840,601 5,790,161
Research and
development
expenses 9,775 120,065 235,592 225,080
Total operating
expenses 2,831,612 3,202,599 6,076,193 6,015,241
Loss from operations (1,424,687) (1,552,435) (3,426,340) (2,078,374)
Other expenses (1,756) (1,024) (3,457) (1,763)
Interest income 1,926 2,154 4,590 2,442
Loss before
provision for
income taxes and
equity in net
losses of equity
investments (1,424,517) (1,551,305) (3,425,207) (2,077,695)
Provision for
income taxes (4,075) (4,664) (15,538) (11,865)
Loss before equity
in net losses of
equity investments (1,428,592) (1,555,969) (3,440,745) (2,089,560)
Earnings (Loss) on
earnings from China
Joint Venture 78,591 15,460 115,374 (28,941)
Net loss (1,350,001) (1,540,509) (3,325,371) (2,118,501)
Net loss
attributable
to
noncontrolling
interests 6,994 61,684 108,657 134,808
Net loss
attributable to
Milestone
Scientific Inc. $(1,343,007) $(1,478,825) $(3,216,714) $(1,983,693)
Net loss per share
applicable to common
stockholders--
Basic (0.04) (0.05) (0.09) (0.06)
Diluted (0.04) (0.05) (0.09) (0.06)
Weighted average
shares outstanding
and to be issued-- 35,297,906 32,399,997 34,939,306 32,122,482
Basic 35,297,906 32,399,997 34,939,306 32,122,482
Diluted
MILESTONE SCIENTIFIC INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Six Months Ended June 30,
2018 2017
Cash flows from operating
activities:
Net loss $ (3,325,371) $(2,118,501)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Depreciation expense 40,762 31,023
Amortization of patents 469,356 35,364
Stock compensation 170,901 237,858
Equity (income) loss on China
joint venture (115,374) 28,941
Inventory reserve 290,349 -
Changes in operating assets and
liabilities:
Increase in accounts
receivable (304,632) (617,347)
Increase (decrease) in
accounts receivable, related
party (1,092,540) 2,358,200
Decrease in other receivables - 10,000
Decrease in inventories 778,530 104,348
Increase to in advances on
contracts (164,590) (150,604)
Decrease (increase) in prepaid
expenses and other current
assets (48,343) (454,562)
Increase in other assets - (9,523)
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