AFP Imaging reports profitable results for fourth quarter and the fiscal year ending June 30, 1996.

ELMSFORD, N.Y.--(BUSINESS WIRE)--Sept. 18, 1996--AFP Imaging Corp. (NASDAQ:AFPC) today reported its June 30, 1996 fiscal year end results.

Annual net sales were $36,528,879 as compared to the previous year's net sales of $26,588,912. Net income for the year was $700,528 or $.08 per share as compared to $923,999 or $.13 per primary share.

The fourth quarter revenues for this year increased to $10,744,636 from $6,736,140. Net income for the fourth quarter was $514,900 or $.05 per share as compared to the fourth quarter in the previous year of $469,698 or $.07 per primary share. The company has completed four profitable quarters this year and is expecting further growth in medical sales for the current fiscal year.

The current year's financial results include the acquisition of Visiplex Instruments which was completed in July 1995 and the additional interest expense and intangible amortization charges associated therewith. The Visiplex electronic imaging product line has been integrated into the company's manufacturing and distribution operations. The consolidation will enhance AFP's core competency and provide a future technology base and strategy for its expanding role in the digital imaging market place. On Sept. 12th, the company received a new contract from an OEM customer for over $900,000 of additional Visiplex electronic imaging products with shipments to be completed within this fiscal year. In a further effort to reduce costs, improve margins and focus corporate resources, the company's fluoroscopic manufacturing operations, in Richmond, VA, were sold in August. The company retained the marketing rights for this product line.

In August, the company launched its new diagnostic imaging product line of BRIGHTVIEW monitors. This state-of-the-art image display unit dramatically improves the radiologist's view of electronic images from a wide range of diagnostic sources. Initial sales have been made to a major New York City medical center where they are in daily use. The above average brightness and resolution is an important feature to enhance and facilitate diagnosis. The company expects that this family of new BRIGHTVIEW products will enhance future revenues and profits. Initial customer indications and firm orders in excess of $750,000 have been received for shipment in this fiscal year.

The company's DENT-X division continues to plan for its future growth around the increasing acceptance of digital imaging in dentistry. The company has entered into a strategic alliance for marketing and distribution of a digital system designed specifically for dental x-ray applications. The product will be available for sale in early 1997. DENT-X will be exhibiting later this month at the major ADA (American Dental Association) meeting which is also designated by FDI as an international congress this year.

The company is continuing to develop its extensive network of independent agents to sell and represent AFP's combined product lines in developing markets. Approximately 30% of the company's revenues are derived from worldwide export sales. The company is actively pursuing sales opportunities in the Pacific Rim countries and anticipates that additional sales growth from all of its products will also come from this part of the world.

AFP Imaging designs, manufactures and markets equipment and systems to hospitals, radiologists, cardiologists, dentists and other medical specialists used to generate, record, process and view hard copy diagnostic images under the AFP, VISIPLEX and DENT-X trademarks. The company also provides a broad line of pre-press image making equipment to the international printing and graphic arts industry under the LOGETRONICS brand. AFP products are distributed worldwide by three different dealer networks. -0-

                   Three Months Ended       Twelve Months Ended
                         June 30,                June 30,
                      1996       1995        1996       1995

Net sales       $10,744,636  $ 6,736,140  $36,528,879  $26,588,912
Income before
 taxes            $ 556,900    $ 279,698    $ 760,528    $ 948,999
Provision (benefit)
 for taxes         $ 42,000    ($190,000)    $ 60,000     $ 25,000
Net income        $ 514,900    $ 469,698    $ 700,528    $ 923,999
Net income
 per share
   Primary             $.05         $.07         $.08         $.13
   Fully diluted       $.05         $.06         $.08         $.12
Weighted average
 number of shares
 and share
 equivalents
 outstanding,
 (common, preferred,
 and common stock
 equivalents)
   Primary        9,788,500    6,941,000    9,112,600    6,922,500
   Fully diluted 10,121,000    8,316,000    9,629,000    8,297,500

CONTACT: AFP Imaging Corp.

David Vozick, 914/592-6100