ATS Medical Inc. Announces Third Quarter Results Closing of Scotland Facility.

MINNEAPOLIS--(BUSINESS WIRE)--Oct. 14, 1997--Manny Villafana, Chairman and CEO of ATS Medical, announced today that sales for the third quarter ended September 30, 1997 totaled $3,469,000 compared to $2,758,825 for the quarter ended September 30, 1996. The 26% increase in revenue was especially noteworthy given significant competition and the strength of the dollar vs. local currencies in the company's key markets. Revenue for the nine months ended September 30, 1997 totaled $10,608,880, a 26% increase over revenue of $8,425,525 for the nine months ended September 30, 1996.

Mr. Villafana also announced that as of October 4, 1997 the company is closing its facility in Glasgow, Scotland. "A European presence allowed our company to initiate clinical studies and achieve regulatory approvals including the CE Mark and Japanese Shonin in parallel with the lengthy U.S. IDE process. We are now able to distribute heart valves from the U.S. to all the approved markets and it was not economically feasible to maintain two facilities," he continued.

"We are very grateful for the assistance of the Scottish government during our six years of operation in Scotland and we sincerely appreciate the dedication and service of our Scottish employees." The closing should result in cost savings in future periods.

The Company will incur one-time expenses totaling approximately $225,000 as a result of this decision. An accrual for this amount is included in S. G. & A. expense for the three and nine month periods ending September 30, 1997.

Before deducting the expense of the shutdown, net income for the quarter ended September 30, 1997 totaled $530,471 or $0.03 per share compared to $384,843 or $0.02 per share for the quarter ended September 30, 1997. After deducting the expenses associated with the shutdown of the Scottish facility, net income for the quarter ended September 30, 1997 totaled $305,471 or $0.02 per share and for the nine months ended September 30, 1997 net income totaled $1,542,681 or $.09 per share compared to $930,635 or $0.06 per share for the nine months ended September 30, 1996.

ATS Medical Inc. manufactures and markets a pyrolytic carbon open pivot mechanical heart valve. The company's common stock is traded on the Nasdaq National Market under the symbol "ATSI".

Portions of this press release contain forward looking statements. Actual results could differ materially from those projected in the forward looking statements as a result of a number of important factors, including regulatory actions, competition, pricing pressures, supplier actions and management of growth. For discussion of these and other important factors that could affect the company's activities and results, please refer to the company's Form 10-Q for the quarter ended June 30, 1997. -0-

                           ATS Medical Inc.
      Consolidated Condensed Statement of Operations (Unaudited)


                       Three months ended       Nine months ended
                         September 30,             September 30,
                       1997       1996           1997         1996
Revenues

 Net sales         3,469,000 $ 2,758,825   $ 10,608,880  $  8,425,525
 Less cost of
  goods sold       2,252,546   1,654,064      6,722,217     5,209,100
  Gross profit     1,216,454   1,104,761      3,886,663     3,216,425

Operating expenses

 Research, development
  and engineering    284,053     137,618        780,812       466,632
 Selling, general and
  administrative     991,389     746,986      2,512,717     2,313,818
   Total expenses  1,275,442     884,604      3,293,529     2,780,450
Interest income      364,459     164,686        949,547       494,660

 Net income for
 the period        $ 305,471   $ 384,843    $ 1,542,681  $    930,635

  Net income
   per share       $    0.02   $    0.02    $      0.09  $       0.06

Weighted average
 number of shares
  outstanding during
  the period      18,112,660  16,065,511     17,781,033    16,485,741


    Consolidated Statement of Financial Position (Unaudited)

                                   September 30,     December 31,
                                       1997              1996
Current Assets
 Cash and marketable securities   $  28,485,702     $  10,187,629
 Accounts receivable                  3,836,457         3,139,559
 Inventory                           21,206,197        18,242,066
 Other current assets                   247,495           468,249
    Total current assets             53,775,851        32,037,503

Furniture, machinery & equipment,
 less accumulated depreciation          817,108           894,564
Other assets, less accumulated
 amortization                           430,068           388,233
Total assets                      $  55,023,027     $  33,320,300

Current liabilities               $   2,111,349     $   1,393,561
Long-term debt                                0                 0
Shareholders' equity                 52,911,678        31,926,739
Total liabilities & shareholders'
 equity                           $  55,023,027     $  33,320,300

CONTACT: ATS Medical Inc., Minneapolis

Manny Villafana, Chairman/CEO

or

Rich Kramp, President/COO

or

Jack Jungbauer, VP/Finance

612/553-7736

612/553-1492 (Fax)