MELVILLE, NY--(Marketwire - November 14, 2008) - FONAR Corporation (
NASDAQ:
FONR), The Inventor
of MR Scanning™, today announced its financial results for the first
quarter of fiscal 2009, which ended September 30, 2008. The net loss for
the first quarter of fiscal 2009 was $450,000 as compared to a net loss for
the same period one year earlier of $209,000. For the first three months of
fiscal 2009 the loss per common share (basic and diluted) was $0.09, as
compared to $0.04 loss per common share (basic and diluted) for the same
period of fiscal 2008.
During the first fiscal quarter of 2009, the loss from operations dropped
to $1.8 million from $4.1 million one year earlier, a decrease of 55%.
Total revenues for the three months ended September 30, 2008 were $6.8
million as compared to $8.7 million for the same period one year earlier.
Service and repair revenues were $2.6 million in the first fiscal quarter
of 2009 as compared to $2.7 million in the first fiscal quarter of 2008.
The decline in revenues is attributable to the current financial crisis
which significantly impedes the ability of a prospective customer to secure
the financing needed to place an order.
As of September 30, 2008, there were 130 FONAR UPRIGHT®
Multi-Position™ MRI units installed worldwide. During the first quarter
of fiscal 2009, total product sales were at $1.4 million.
At the end of the first fiscal quarter of fiscal 2009, total current assets
were $20.6 million, total assets were $33.4 million, total current
liabilities were $36.6 million and total long-term liabilities were $1.4
million. Total cash and cash equivalents, and marketable securities
increased 84% from $2.4 million on June 30, 2008 to $4.4 million on
September 30, 2008.
The Company sold its 92.3% interest in a consolidated entity in September
2008. This significant one-time event, within the reporting period,
resulted in a gain of approximately $1.4 million. The consolidated entity
managed an outpatient MRI center using the UPRIGHT® Multi-Position™
MRI scanner.
As previously announced, on July 8, 2008, the Company received a notice of
non-compliance from The NASDAQ Stock Market LLC due to the Company's
failure to satisfy NASDAQ's proxy solicitation and annual meeting
requirements. In response to the first notice of non-compliance, the
Company requested and subsequently attended a hearing before a NASDAQ
Listing Qualifications Panel (the "Panel"), at which the Company presented
its plan to regain compliance with those requirements. Pursuant to the plan
presented to the Panel on October 8, 2008, the Company filed a definitive
proxy statement for the annual shareholders meeting, which is scheduled to
be held on November 17, 2008. The Panel has not yet rendered a
determination as a result of the hearing.
On October 9, 2008, the Company received an additional notice of
non-compliance from The NASDAQ based upon the Company's non-compliance with
the minimum stockholders' equity requirement of $2.5 million for continued
listing on The NASDAQ Capital Market, as set forth in NASDAQ Marketplace
Rule 4310(c)(3) (the "Stockholders' Equity Requirement"), at June 30, 2008,
which could serve as an additional basis for delisting of the Company's
securities from The NASDAQ Capital Market. The Company has made a written
submission to the Panel presenting its plan to regain compliance with the
Stockholders' Equity Requirement. While the Company is hopeful that the
Panel will grant its request for continued listing on NASDAQ, there can be
no assurance that the Panel will do so.
Raymond Damadian, M.D., president and chairman of FONAR said, "The medical
device industry has not been exempt from the current financial crisis that
has affected all segments of the American economy. Consequently, we have
been exercising careful control of R&D and selling, general and
administrative costs which have decreased 35% from $6.5 million to $1.4
million. As a result, our loss from operations has fallen to its lowest
level since fiscal 2005 when FONAR reported an operating profit of $1.7
million. Notwithstanding the present nationwide financial pressures, FONAR
looks forward only with optimism and enthusiasm as FONAR's patented
UPRIGHT® weight-bearing MRI technology ultimately becomes a mandatory new
standard of care in spine medicine, particularly for those facing surgery
and as new applications of UPRIGHT® MRI, such as radiation-free
monitoring of scoliosis patients and the non-invasive diagnosis of pelvic
floor dysfunction (PFD) and urinary incontinence that affects 10 million
women, continue to emerge with regularity."
Condensed Consolidated Statements of Operations
(Unaudited)
(000's omitted)
For the Three Months Ended September 30,
2008 2007
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Revenues $ 6,784 $ 8,669
Net Loss $ (450) $ (209)
Basic & Diluted
Loss Per Common Share $ (0.09) $ (0.04)
The Inventor of MR Scanning™, Full Range of Motion™, pMRI™,
Dynamic™, Multi-Position™, True Flow™, The Proof is in the
Picture™, Spondylography™ and Spondylometry™ are trademarks and
UPRIGHT® and STAND-UP® are registered trademarks of FONAR Corporation.
This release may include forward-looking statements 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's filings with the Securities and Exchange Commission.
Contact Information: Contact:
Daniel Culver
FONAR Corporation
Tel: 631-694-2929
Fax: 631-390-1709
http://www.fonar.com