Earnings are out...
(COMTEX) B: Imatron Announces Third Quarter Results; Imatron Ultrafas B: Imatron Announces Third Quarter Results; Imatron Ultrafast CT Results Featured at the 71st Scientific Sessions of the American Heart Association
SOUTH SAN FRANCISCO, CALIF. (Nov. 13) BW HEALTHWIRE -Nov. 13, 1998--
Imatron Inc (IMAT) said today that revenues from continuing operations
(excluding HeartScan Imaging, Inc.) for the third quarter ended
September 30, 1998 decreased 24 percent to $7.3 million from $9.7
million for the same period last year.
Revenues from continuing operations for the nine months ended September
30, 1998 were $22.5 million, a decrease of 25 percent from the
comparable period last year. The reported decrease in sales revenues is
principally a result of reduced Ultrafast CT(R) scanner sales during
the first quarter of 1998, a decrease in average scanner sales price in
the third quarter and the continued negative economic conditions in
Asia.
The Company reported a loss from continuing operations for the three
months ended September 30, 1998 of $2.6 million, or $0.03 per share,
compared with income from continuing operations of $21,000, or $0.01
per share, a year ago. For the nine months ended September 30, 1998,
the Company reported a loss from continuing operations of $6.2 million,
or $0.07 per share, compared with income from continuing operations of
$1.4 million, or $0.02 per share, a year ago. The Company reported cash
and cash equivalents of $1.5 million, working capital of $16.8 million
and a current ratio of 2.4 to 1, as of September 30, 1998.
On July 13, 1998 the Company adopted a formal plan to sell its
HeartScan Imaging, Inc. subsidiary. On July 22, 1998, a letter of
understanding was reached to sell substantially all of the assets of
HeartScan to Lifetest America, Inc. for approximately $7.4 million in
cash and assumption of equipment-related lease liabilities. The
proposed agreement to sell exclusively to Lifetest ended on October 15,
1998. As of September 30, 1998, HeartScan continued to be held for
sale. It is management's best estimate that the sale of HeartScan will
produce a gain for Imatron.
Accordingly, the financial results of HeartScan's operations have been
de-consolidated and are now reported as discontinued operations. For
the three months ended September 30, 1998 the Company reported revenues
from discontinued operations of $1.0 million and a loss from
discontinued operations of $1.1 million. For the nine months ended
September 30, 1998, the Company reported revenues from discontinued
operations of $3.1 million with a loss from discontinued operations of
$3.7 million.
The Company's net loss reported for the three months ended September
30, 1998 was $3.7 million, or $0.04 per share. The Company's net loss
for the nine months ended September 30, 1998, was $10.7 million, or
$0.13 per share.
S. Lewis Meyer, Imatron's President and CEO said, "We are encouraged by
the progress of our domestic sales team, as witnessed by third
quarter's strong U.S. sales momentum. All EBT scanner sales reported in
the third quarter were from the U.S. market. We do, however, continue
to experience disappointment and frustration with sales progress in the
International arena, which continues to be negatively impacted by
economic conditions in Asia. We have clearly suffered from the economic
turmoil in International markets that have historically been strong for
the Company's Ultrafast CT scanner."
Mr. Meyer continued, "We continue to be extremely optimistic about the
future, as we continue to benefit from positive publicity and the
release of favorable research and studies on the Company's proprietary
electron beam tomography technology. As medical community and public
awareness of the benefits of Ultrafast CT increases, we believe the
next step will be expanded reimbursement of coronary artery scanning by
Ultrafast CT by major insurance companies and HMOs nationwide, driving
future scanner sales."
In addition to the earlier nationally televised news from the
University of Pittsburgh investigators concerning the application of
Imatron's EBT scanner in the detection of heart disease in women,
researchers at this week's 71st Scientific Sessions of the American
Heart Association in Dallas heard new study results in a total of 19
presentations about cardiac Ultrafast CT.
Of particular note were two presentations, from the Universities of
Essen and Illinois, respectively, confirming earlier reports of the
ability of EBT coronary artery calcium measurements to predict coronary
events in only 2 to 4 years of patient follow-up. These data, in both
symptomatic patients and those at lower risk, support the previously
published findings from Arad and colleagues at St. Francis Hospital,
Roslyn, New York, demonstrating that the coronary artery scan by EBT
allows the clinician to predict the risk of cardiac disease severity,
the need for interventions and even anticipate future heart attacks and
coronary artery disease-related deaths.
Other papers, from the Baylor College of Medicine in Houston and the
Mayo Clinic, both demonstrated the ability of the coronary artery scan
by EBT to stratify risk of patients having a significant coronary
artery blockage and determine the most appropriate and cost-effective
methods of further testing, when necessary.
Commenting on the sessions, Mr. Meyer said, "This has been by far the
highest level of visibility and acceptance of EBT at a major cardiology
meeting. There is a ground swell of support and recognition of the
importance of Imatron's pioneering work in coronary artery scanning to
have a real impact in the early detection and monitoring the
effectiveness of subsequent treatment of coronary atherosclerosis. The
number of sales prospects continues to increase dramatically and our
new corporate alliance with General Electric greatly enhances our
ability to respond to what we see will be increased future demand for
our product and the unique role the EBT scanner can play in the
diagnosis and treatment of heart disease."
Imatron, Inc. is primarily engaged in designing, manufacturing,
marketing, and supporting high performance computed tomography (CT)
scanners based on the Company's proprietary scanning electron beam
technology. Ultrafast CT is a registered trademark of Imatron.
Imatron's Ultrafast CT scanner is now in use at major medical centers
around the world, including The Mayo Clinic, University of Iowa,
National Institutes of Health, UCLA, Stanford University, University of
Illinois, The Arizona Heart Institute, The Royal Brompton Hospital in
London, Tokyo University Hospital and Beijing Hospital.
Except for the historical information contained herein, the matters
discussed in this news release may contain forward-looking statements
that are based on current expectations and estimates about the industry
in which Imatron operates, the estimated impact of certain
technological advances, the estimated impact of published research
studies on scanner sales and procedures, as well as management's
beliefs and assumptions. It is important to note that the Company's
actual results could differ materially from those projected in such
forward-looking statements. The factors that could cause actual results
to differ materially include, among others: failed clinical
demonstration of certain asserted technological advantages and
diagnostic capabilities; reliance on product distributors; competition
in the diagnostic imaging market; failure to improve product
reliability or introduce new product models and enhancements; delays in
production and difficulty in obtaining components and sub-assemblies
from limited sources of supply; inability to meet cash-on-delivery or
prepayment terms from vendors; determinations by regulatory and
administrative government authorities; patent expiration and denial of
patent applications; the high cost of the scanner as compared to
commercially available CT scanners; and the risk factors listed from
time to time in the Company's Securities and Exchange Commission
reports, including their reports on Form 10-K for their current fiscal
year.
IMATRON INC.
Condensed Consolidated Statements of Operations
(Amounts in thousands, except per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
(Restated) (Restated)
Revenues:
Product sales $ 5,705 $ 6,869 $ 16,546 $ 22,591
Service 1,626 1,576 4,672 3,732
Development contracts - 1,250 1,250 3,750
Total revenues 7,331 9,695 22,468 30,073
Cost of revenues:
Product sales 4,392 4,875 11,767 15,015
Service 1,508 1,056 4,721 2,668
Total cost of revenues 5,900 5,931 16,488 17,683
Gross profit 1,431 3,764 5,980 12,390
Operating expenses:
Research and development 1,887 2,083 5,926 6,710
Marketing and sales 1,030 991 3,063 2,596
General and administrative 1,146 790 3,272 2,186
Total operating expenses 4,063 3,864 12,261 11,492
Total operating income (loss) (2,632) (100) (6,281) 898
Other income, net 11 128 142 553
Interest expense (4) (7) (15) (22)
Income (loss) from continuing
operations before provision
for income taxes (2,625) 21 (6,154) 1,429
Provision for income taxes - - - -
Income (loss) from continuing
operations (2,625) 21 (6,154) 1,429
Loss from discontinued
operations (1,087) (1,521) (3,662) (4,790)
Non-cash return to minority
interest - (436) (874) (1,308)
Net loss $(3,712) $(1,936) $(10,690) $(4,669)
Basic and diluted loss per
common share:
Income (loss) from
continuing operations
-- basic $(0.03) $ 0.01 $(0.07) $ 0.02
Income (loss) from
continuing operations
-- diluted $(0.03) $ 0.01 $(0.07) $ 0.02
Net loss-basic and diluted $(0.04) $(0.03) $(0.13) $(0.06)
Weighted average number of
shares used in continuing
operation per share
calculation -- basic 86,997 78,574 82,450 78,350
Weighted average number of
shares used in continuing
operation per share
calculation -- diluted 86,997 81,684 82,450 81,510
Weighted average number of
shares used in net loss
per share calculation
-- basic and diluted 86,997 78,574 82,450 78,350
IMATRON INC.
Condensed Consolidated Balance Sheets
(Amounts in thousands)
(Unaudited)
September 30, December 31,
1998 1997
ASSETS:
Current assets
Cash and cash equivalents $ 1,493 $ 8,400
Short-term investments - 180
Accounts receivable (net of
allowance for doubtful accounts of
$3,105 at September 30, 1998 and
$2,490 at December 31, 1997:
Trade accounts receivable 7,381 7,944
Accounts receivable from affiliate 1,916 1,438
Inventories 17,193 12,926
Prepaid expenses 681 397
Net current assets of discontinued
operations - 4,697
Total current assets 28,664 35,982
Property and equipment, net 2,305 2,394
Other assets 1,608 1,214
Long-term net assets of discontinued
operations 3,414 3,575
Total assets $ 35,991 $ 43,165
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities
Accounts payable $ 3,954 $ 2,962
Other accrued liabilities 7,744 6,961
Capital lease obligations -- due within
one year 58 56
Net current liabilities of discontinued
operations 96 -
Total current liabilities 11,852 9,979
Deferred income on sale leaseback
transactions 1,000 1,376
Deferred income on service contract 330 420
Capital lease obligations 21 65
Total liabilities 13,203 11,840
Minority interest in discontinued
operations 1,170 14,255
Shareholders' equity
Common stock, no par value;
authorized - 150,000 shares;
issued and outstanding -
87,217 shares in 1998 and
78,815 shares in 1997 106,305 90,728
Deferred compensation (170) (232)
Additional paid-in capital 9,340 9,290
Notes receivable from stockholders (451) -
Accumulated deficit (93,406) (82,716)
Total shareholders' equity 21,618 17,070
Total liabilities and shareholders' equity $ 35,991 $ 43,165
-0- pw/sf* rn/sf
CONTACT: Imatron
S. Lewis Meyer/Gary Brooks/Robin Kelley, 650/583-9964
or
Sitrick And Company
Jeffrey Lloyd, 310/788-2850
KEYWORD: CALIFORNIA ILLINOIS NEW YORK
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