West Berlin, NJ (March 11, 2004)--EP MedSystems, Inc. (NASDAQ: EPMD), a market leader in electrophysiology products used to diagnose and treat certain types of cardiac rhythm disorders, today announced financial results for the fourth quarter and year ended December 31, 2003. Revenues for the fourth quarter were $3,206,000, representing a 48% increase over third quarter revenues, and a 10% increase over fourth quarter 2002 revenues. Loss from operations was $1,275,000 for the fourth quarter, an improvement of 17%, as compared to $1,540,000 for the same period in 2002. The basic and diluted loss per share was $0.05 for the fourth quarter and $0.08 for the comparable period in 2002.
Revenues for the full year of 2003 were $10,003,000, representing a 19% decrease from year earlier revenues. Revenue in 2002 included $1.25 million of revenue from a product line we no longer sell. The net loss for the year ended December 31, 2003 was $6,949,000, compared to $5,048,000 for the same period in 2002. The basic and diluted loss per share for the year ended December 31, 2003 was $0.38, and was $0.34 for the comparable period in 2002.
Reinhard Schmidt, President and CEO of EP MedSystems, Inc. commented, “2003 was a year of numerous product approvals, including the ViewMate® intracardiac ultrasound catheter imaging system, the integration of EP-WorkMate® Electrophysiology Workstation with our RPM™ Real-time Position Management™ navigation technology, and the pre-market supplement approval of the Company’s ALERT® Companion II and ALERT family of internal cardioversion catheters. With these product approvals in hand, we began to invest in sales and marketing and expand our channel strategies around our EP-WorkMate® platform with Boston Scientific and recently announced agreement Philips Medical. In addition, we believe we have strengthened our balance sheet to provide capital we currently believe to be necessary for an effective roll-out of these new products in 2004.”
Mr. Schmidt further stated, “Our shortfall in revenue form the same period in 2002 was partially the result of discontinuing sales of x-ray machines, as we prepared to focus on our new products and a slow start in 2003 in the U.S. and Asia. I am very pleased with the 48% revenue growth from the third quarter to the fourth quarter and with the initial sales of the RPM™ and the ViewMate®, and believe that our investment in sales and marketing is starting to pay off.”
Mr. Schmidt concluded by stating, ”We believe the major risks associated with product development and regulatory approvals are behind us. As we enter 2004, we have three new product platforms approved for sale, which we did not have at this time last year. With the approval of the EP-4 Stimulator, we have added significant promise to our viable core WorkMate stimulator platform. Finally, we believe we are making significant progress in channel strategy along with the appropriate investments in sales and marketing to drive revenue and achieve profitability.”
The Company will discuss its fourth quarter and year end financial results on a conference call scheduled to take place today, March 11, 2004, at 4:30 p.m. EST. To participate, call (800) 374-0565 at least 10 minutes prior to the scheduled start time. When prompted, give the operator your name, firm name and phone number. The phone replay will be available for five business days following the call by dialing (800) 642-1687 and entering 5915068 when prompted for a code.
About EP MedSystems, Inc.
EP MedSystems develops and markets cardiac electrophysiology (“EP”) products used to diagnose and treat certain cardiac rhythm disorders. The Company’s EP product line includes the EP-WorkMate® Electrophysiology Workstation, the EP-3‰ Stimulator, diagnostic electrophysiology catheters and related disposable supplies, the ALERT® System and ALERT family of internal cardioversion catheters and the ViewMate® intracardiac ultrasound catheter imaging system . EP MedSystems’ shareholders include Medtronic (NYSE: MDT), Boston Scientific Corporation (NYSE: BSX), EGS Private Healthcare Partnership, H & Q Lifesciences, and Cardiac Capital LLC. For more information, visit our Website at
www.epmedsystems.com.
This Release contains certain statements of a forward-looking nature relating to future events and the future financial performance of EP MedSystems including, but not limited to financial forecasts for the year 2003 and beyond, and acceptance of our products in the EP marketplace sector. Forward-looking statements include information concerning our possible or assumed future results of operations and statements preceded by, followed by or including the words “believes”, “expects”, “anticipates”, “intends”, “plans”, “estimates”, or similar expressions. Such forward-looking statements are based on our management’s beliefs and assumptions and on information currently available to our management. It must be noted that such forward-looking statements involve assumptions. Such forward-looking statements are only predictions and are subject to risks and uncertainties that could cause actual results or events to differ materially and adversely from the events discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, EP MedSystems' history of losses, uncertainty of market acceptance of our products and level of sales, uncertainty of future profitability and future liquidity needs; and risks regarding regulatory approvals and demand for new and existing products, as stated in the Company's Annual report filed on Form 10-KSB and quarterly reports filed on Form 10-QSB.
EP MedSystems cautions investors and others to review the cautionary statements set for in this Release and in EP MedSystems’ reports filed with the Securities and Exchange Commission and cautions that other factors may prove to be important in affecting the EP MedSystems’ business and results of operations. Readers are cautioned not to place under reliance on the press release and other forward-looking statements, which speak only as of the date of this release. EP MedSystems undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events.
EP MEDSYSTEMS, INC.
SELECTED FINANCIAL DATA
Years Ended
December 31,
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Income Statement Data 2003 2002
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Net Sales $10,003,000 $12,419,000
Cost of products sold 4,763,000 5,707,000
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Gross Profit 5,240,000 6,712,000
Operating expenses
Sales and marketing 5,563,000 4,975,000
General and administrative 2,566,000 2,604,000
Research and development 2,566,000 3,289,000
Mortgage conversion
Deferred offering costs 222,000 1,119,000
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Loss from operations (5,677,000) (5,275,000)
Interest expense, net (459,000) (211,000)
Interest expense, debt conversion (1,000,000) -
Change in valuation of warrants (211,000) -
Income tax benefit 398,000 438,000
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Net Loss $(6,949,000) $(5,048,000)
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Basic and diluted loss per share $ (0.38) $ (0.34)
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Weighted Average
Shares Outstanding 18,378,450 14,849,333
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Balance Sheet Data At December At December
31, 2003 31, 2002
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Cash and cash equivalents and restricted
cash $12,249,000 $ 2,013,000
Working capital 12,543,000 3,860,000
Total assets 21,661,000 10,928,000
Total liabilities 10,035,000 9,225,000
Shareholder's equity 11,626,000 1,703,000
For Further Information Contact:
Matthew C. Hill, Chief Financial Officer
(856) 753-8533
MKR Group, LLC
Charles Messman, Todd Kehrli
(818)556-3700
