Radiance Announces First Quarter Financial Results.Business Editors & Health/Medical Writers IRVINE, Calif.--(BW HealthWire)--May 8, 2002 Radiance Medical Systems Inc. (Nasdaq:RADX) Irvine, today announced financial results for the first quarter ended March 31, 2002. Revenues for 2002 were 13% lower at $1,768,000, compared with $2,025,000 for the first quarter of fiscal 2001. Product revenue decreased to $0 for the first quarter ended March 31, 2002, from $429,000 for the first quarter of fiscal 2001, due to the discontinuance Cessation; ending; giving up. The discontinuance of a lawsuit, also known as a dismissal or a non-suit, is the voluntary or involuntary termination of an action. DISCONTINUANCE, pleading. A chasm or interruption in the pleading. 2. of Focus technology product sales in the fourth quarter of fiscal 2001. License revenues for the quarter ended March 31, 2002 rose 11% to $1,768,000, from $1,596,000 for the same period of 2001. License revenues are primarily derived from royalties received from Guidant related to sales of Guidant products using the company's licensed Focus technology, and therefore future revenues may be impacted significantly by changes in Guidant's related product sales. Net income for the first quarter of 2002 was $548,000, or $0.04 per share, up from a net loss of $3,235,000, or $0.25 loss per share for the same period of fiscal 2001. The increase in income for the first quarter of fiscal 2002 was attributable primarily to a reduction in expenses following the restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). of the company in the third quarter of fiscal 2001. Moreover, research, development and clinical expenses for the first quarter of fiscal 2002 were 77% lower at $1,017,000, compared with $4,328,000 for the first quarter of fiscal 2001. The reduction in research, development and clinical expenses was due primarily to the discontinuance of research and development and European manufacturing facilities for the RDX RDX Cyclotrimethylenetrinitramine (CAS Number 121-82-4) Rdx Radixin RDX Russian Depositary Index RDX Research and Development Explosive (less common) RDX Hexahydro-Trinitro-Triazine system, as well as the completion of enrollment for U.S. pivotal study BRITE BRITE Cardiology A clinical trial–Beta Radiation to Reduce In-Stent Restenosis–evaluating the efficacy of the RDX™ Catheter Radiation Delivery System in reducing the risk of restenosis after intracoronary intervention for ASHD. II. The discontinuance of sales and marketing for existing products, as well as an administrative workforce reduction, also contributed to the decrease in expenses for the first quarter of fiscal 2002, compared with the same period of fiscal 2001. Due to the restructuring, Radiance anticipates that operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. for the second quarter of fiscal 2002 will be lower, compared with the same period of fiscal 2001. As previously announced, in February 2002 Radiance entered into a definitive agreement to merge with Endologix, a developer and manufacturer of endoluminal stent grafts Difference Between a Stent Graft and a Stent A stent graft is a tubular device, which is composed of special fabric supported by a rigid structure, usually metal. The rigid structure is called a stent. for the treatment of abdominal abdominal /ab·dom·i·nal/ (ab-dom´i-n'l) pertaining to the abdomen. ab·dom·i·nal adj. Of or relating to the abdomen. n. An abdominal muscle. aortic aortic pertaining to or emanating from the aorta. See also aortic arch. aortic aneurysm occurs most often in dogs, where it is caused by Spirocerca lupi larvae, turkeys and primates, causing dyspnea, cyanosis and coughing. aneurisms ("AAA AAA: see American Automobile Association. (Triple A) A common single-cell battery used in a myriad of electronic devices of all variety. Like its double A (AA) cousin, it provides 1.5 volts of DC power. When used in series, the voltage is multiplied. "). Subject to shareholder approval and other customary closing conditions, the merger transaction is expected to close in the second quarter of 2002. Commenting on the activities of the quarter, Jeff Thiel, president & CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , said: "During the quarter, we continued to focus on follow-up of patients in the BRITE II pivotal study and entered into a definitive merger agreement with Endologix. We look forward to working with the staff of Endologix to complete development of the Endologix technology and competing worldwide in the AAA stent graft market." Radiance Medical Systems develops radiation delivery catheters for use in the treatment of coronary and peripheral vascular vascular /vas·cu·lar/ (vas´ku-ler) 1. pertaining to vessels, particularly blood vessels. 2. indicative of a copious blood supply. vas·cu·lar adj. systems to prevent restenosis restenosis /re·ste·no·sis/ (re?ste-no´sis) recurrent stenosis, especially of a cardiac valve after surgical correction of the primary condition.restenot´ic re·ste·no·sis n. following the interventional treatment of atherosclerosis atherosclerosis (ăth'ərōsklərō`sĭs): see arteriosclerosis. atherosclerosis or hardening of the arteries . For more information about Radiance, visit the company's Web site at www.radiance.net. Except for historical information contained herein, this news release contains 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. , the accuracy of which are necessarily subject to risks and uncertainties, and which may be affected by, among other things, risks and uncertainties related to the effects of the proposed merger with Endologix on Radiance, the ability of Radiance to successfully integrate Endologix's and Radiance's operations and business strategies, future economic, competitive and market conditions, including those in Europe and Asia and those related to Radiance's and Endologix's strategic markets, whether the products offered will achieve acceptance in the marketplace and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of Radiance. In addition, the accuracy of the forward-looking statements in this news release are necessarily subject to other risks and uncertainties, and may be affected by, among other things, risks and uncertainties involving new product development and introduction cycles, research and development activities, including failure to demonstrate clinical efficacy, delays by regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest regulatory agency administrative body, administrative unit - a unit with administrative responsibilities , scientific and technical advances by third parties, introduction of competitive products, third party reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. and physician training, and other risk factors, and matters set forth in the company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended Dec. 31, 2001. Radiance has filed documents concerning the merger transaction mentioned above with the Securities and Exchange Commission. Radiance urges investors and securityholders to read these documents carefully, including the proxy statement Proxy Statement A document containing the information that a company is required by the SEC to provide to shareholders so they can make informed decisions about matters that will be brought up at an annual stockholder meeting. related to the merger, because they contain important information. Investors and securityholders may obtain these documents and others related to Radiance free of charge at the SEC's web site at www.sec.gov. In addition, documents filed by Radiance with the SEC will be available for free by directing a request to the Secretary of Radiance, at 13900 Alton Parkway, Suite 122, Irvine, Calif. 92618, telephone 949/457-9546. Radiance, its directors and executive officers and other employees may participate in the solicitation solicitation In criminal law, the act of asking, inducing, or directing someone to commit a crime. The person soliciting another becomes an accomplice to the crime. The term also refers to the act of obtaining bribes, as well as to the crime of a prostitute who offers sexual of proxies on behalf of the merger. The information concerning the participants is included in the proxy statement on Schedule 14A filed with the SEC.
RADIANCE MEDICAL SYSTEMS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(unaudited)
Three Months Ended March 31,
2002 2001
Revenues:
Product $ -- $429
License 1,768 1,596
Total
revenues 1,768 2,025
Cost of
product
sales 69 307
Gross
profit 1,699 1,718
Operating
expenses:
Research,
development
and
clinical 1,017 4,328
Marketing
and sales -- 394
General
and
administrative 398 737
Minority
interest (8) (7)
Total
operating
expenses 1,407 5,452
Income
(loss)
from
operations 292 (3,734)
Other income
(expense):
Interest
income 226 451
Gain on
sale of
assets 34 23
Other
income
(expense) (4) 25
Total
other
income 256 499
Net income
(loss) $548 ($3,235)
Basic
earnings
(loss) per
share $0.04 ($0.25)
Shares used in
computing basic
earnings
(loss) per
share 13,157 13,061
Diluted
earnings
(loss) per
share $0.04 ($0.25)
Shares
used in
computing
diluted
earnings
(loss) per
share 13,277 13,061
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