FONAR Announces Fiscal 2007 Second Quarter Financial Results.MELVILLE, N.Y. -- FONAR Corporation (NASDAQ-FONR), The Inventor of MR Scanning[TM], today announced its financial results for the second quarter of fiscal 2007, which ended December 31, 2006. Revenue for the second quarter for fiscal 2007 was $7.7 million compared to $10.5 million for the corresponding period of fiscal 2006. During the second fiscal 2007 quarter, product sale revenues were $2.1 million, a decrease from $4.2 million one year earlier. The lower level of revenue is attributable to a slow down in capital equipment purchases by customers following robust UPRIGHT[TM] Multi-Position[TM] MRI 1. (application) MRI - Magnetic Resonance Imaging. 2. MRI - Measurement Requirements and Interface. sales in 2003, 2004 and 2005. Sales of the FONAR UPRIGHT[TM] Multi-Position[TM] MRI were negatively affected primarily by marketing and advertising pressure from our competitors. These competitors are motivated to minimize the unique medical benefits of the UPRIGHT[TM] Multi-Position[TM] MRI because they are prohibited from making a similar product because of FONAR's patents protecting its product from infringement. Service and repair revenues for the second fiscal 2007 quarter increased from $2.1 million to $2.4 million or by 16% in the fiscal second quarter of 2007 from the same quarter of fiscal 2006. In addition, for the six month period ending December 31, 2006 service and repair fees increased to $5.0 million from $4.0 million for the corresponding period of fiscal 2006. This 23% increase is due to the result and initiation of service contract agreements from recent installations of FONAR UPRIGHT [TM] Multi-Position[TM] MRI units. During this six month period, costs related to service and repair fees decreased from $2.8 million to $2.5 million, and subsequently, the gross margin on service and repair fees increased from 31% to 49%. As of December 31, 2006, there were 115 FONAR UPRIGHT[TM] Multi-Position[TM] MRI units installed worldwide. Net loss for the second quarter of fiscal 2007 was $(5.5) million, or $(0.05) loss per common share (basic and diluted), as compared to a net loss of $(5.4) million, or $(0.05) loss per common share (basic and diluted), for the corresponding period of fiscal 2006. At December 31, 2006, total cash and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has were approximately $8.7 million. This represented an overall decrease of approximately 9% or $800,000 as compared to the period ending June 30, 2006 of approximately $9.5 million. This, however, compares to a decrease of only $64,000 as compared to September 30, 2006 which was approximately $8.7 million. On December 31, 2006, total assets were $53.2 million, total current assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. were $34.5 million, total current liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. were $28.4 million, and total long-term liabilities Long-Term Liabilities Recorded on the balance sheet, a company's liabilities for leases, bond repayments and other items due in more than one year. Notes: A company's long-term liabilities are accounted for by its debt obligations to other parties which last longer than were $1.4 million. Commenting on the financial results for the second fiscal 2007 quarter, Raymond Damadian, M.D., president and chairman of FONAR, said, "A very competitive atmosphere has led to a decline in sales. Subsequently, we are planning to expand our sales force, both in terms of hiring more sales personnel and further establishment of a domestic network of distributors. The advantages of the FONAR UPRIGHT[TM] Multi-Position[TM] MRI scanner are significant over our competitors' recumbent-only, single-position-only, static MRI systems, especially when imaging the spine. This is significant because spine MRI scans are approximately half of all MRI scans done. There were about 13 million spine scans done in the U.S. last year and given the unique advantages, they should all be done by the FONAR UPRIGHT[TM] Multi-Position[TM] MRI." "We are encouraged by our recent sales," said Dr. Damadian. "Recently FONAR and GE Healthcare GE Healthcare is a $18 billion (USD) unit of General Electric (GE). It employs more than 46,000 people worldwide and is headquartered in Chalfont St. Giles, Buckinghamshire, United Kingdom. GE Healthcare is the first GE business segment headquartered outside the United States. , a manufacturer's representative for FONAR, sold an UPRIGHT[TM] Multi-Position[TM] MRI to the Center for Diagnostic Imaging (CDI CDI compact disc interactive: a system for storing a mix of software, data, audio, and compressed video for interactive use under processor control ), of Minneapolis, Minnesota “Minneapolis” redirects here. For other uses, see Minneapolis (disambiguation). Minneapolis (pronounced IPA: /ˌmɪniˈæpəlɪs/) is the largest city in the U.S. . This is an important sale for FONAR because CDI is very prestigious in the MRI market place. Last year, readers of Medical Imaging Magazine, a leading, national diagnostic imaging industry publication, overwhelmingly selected CDI as the "NUMBER ONE FREESTANDING IMAGING GROUP" in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . In addition, several CDI associates and a CDI radiologist were also recognized in the top ten in their individual categories." For details visit: www.medicalimagingmag.com/issues/articles/2006-01_01.asp#freeimage [TABLE OMITTED] About FONAR FONAR[R] was incorporated in 1978, making it the first, oldest and most experienced MRI manufacturer in the industry. FONAR introduced the world's first commercial MRI in 1980, and went public in 1981. Since its inception, FONAR has installed hundreds of MRI scanners worldwide. Their stellar product line includes the FONAR UPRIGHT[TM] Multi-Position[TM] MRI (also known as the UPRIGHT[TM] MRI and the Stand-Up stand·up or stand-up adj. 1. Standing erect; upright: a standup collar. 2. Taken, done, or used while standing: a standup supper; a standup bar. [TM] MRI), the only whole-body MRI that performs Multi-Position[TM] Imaging (mpMRI[TM]) and scans patients in numerous weight-bearing positions, i.e. standing, sitting, in flexion flexion /flex·ion/ (flek´shun) the act of bending or the condition of being bent. flex·ion n. 1. The act of bending a joint or limb in the body by the action of flexors. 2. and extension, as well as the conventional lie-down position. The FONAR UPRIGHT[TM] Multi-Position[TM] MRI often sees the patient's problem that other scanners cannot because they are single position, lie-down only. With one half million patients scanned, the patient-friendly FONAR UPRIGHT[TM] Multi-Position[TM] MRI has a near zero claustrophobic claus·tro·pho·bic adj. 1. a. Relating to or suffering from claustrophobia. b. Uncomfortably closed or hemmed in. 2. rejection rate by patients. A radiologist said, "FONAR UPRIGHT[TM] MRI - No More Claustrophobia claustrophobia /claus·tro·pho·bia/ (-fo´be-ah) irrational fear of being shut in, of closed places. claus·tro·pho·bi·a n. An abnormal fear of being in narrow or enclosed spaces. - The Tunnel Is Gone." As another FONAR customer states, "If the patient is claustrophobic in this scanner, they'll be claustrophobic in my parking lot." Approximately 85% of patients are scanned sitting while they watch a 42" flat screen TV. FONAR's latest MRI scanner is the FONAR 360, a room-size recumbent recumbent /re·cum·bent/ (re-kum´bent) lying down. re·cum·bent adj. Lying down, especially in a position of comfort; reclining. scanner that optimizes openness while facilitating physician access to the patient. FONAR is headquartered on Long Island, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , and has approximately 400 employees. The Inventor of MR Scanning, Full Range of Motion, STAND-UP MRI, UPRIGHT MRI, Multi-Position MRI, Pmri, True Flow MRI, and The Proof is in the Picture are trademarks of FONAR Corporation. Be sure to visit FONAR's Web site for Company product and investor information: www.fonar.com This release may include forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. from the company that may or may not materialize. Additional information on factors that could potentially affect the company's financial results may be found in the company filings with the Securities and Exchange Commission. |
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