SOURCE: Trimedyne, Inc.

January 18, 2011 09:30 ET

Trimedyne Reports Financial Results for the Quarter and Fiscal Year Ended September 30, 2010

LAKE FOREST, CA--(Marketwire - January 18, 2011) - TRIMEDYNE, INC. (OTCBB: TMED) reported revenues of $6,401,000 for the fiscal year ended September 30, 2010, a 14% decline from revenues of $7,422,000 for the prior fiscal year. The decline in revenues was largely due to reduced sales due to the economic slowdown and persistent unemployment, as many people are putting-off elective procedures.

The Company had an operating loss of $(1,441,000) for the 2010 fiscal year, compared to an operating loss of $(1,214,000) for the prior fiscal year. As a result of the amicable settlement of the Company's contract dispute with Lumenis, Ltd. of Yokneam, Israel, the Company had net income of $639,000 or $0.04 per share for the 2010 fiscal year, compared to a net loss of $(909,000) or $(0.03) per share for the prior fiscal year.

For the quarter ended September 30, 2010, the Company had revenues of $1,505,000, a 28% decline from revenues of $2,112,000 for the same quarter of the prior year. The Company had an operating loss of $(573,000) for the quarter ended September 30, 2010, compared to an operating loss of $(151,000) for the same quarter of the prior year. The Company had a net income of $1,308,000 or $0.07 per share for the quarter ended September 30, 2010, versus a net loss of $(37,000) or $0.00 per share for the year earlier quarter.

Included in the cost of sales for the fiscal year and quarter ended September 30, 2010, were charges to inventory, primarily for excess and obsolete inventory, of $241,000. Without these non-cash charges, the Company's loss from operations would have been $(1,200,000) for the fiscal year and $(332,000) for the quarter ended September 30, 2010, and the Company's net income for the fiscal year and quarter ended September 30, 2010, would have been $880,000 and $1,549,000, respectively.

The Company ended the 2010 fiscal year with cash and equivalents of $2,528,000 and receivables and other current assets of $868,000, versus accounts payable and accrued expenses of $717,000.

Again, due to the amicable settlement of the Company's contract dispute with Lumenis, Ltd., the Company had net income of $1,308,000 or $0.07 per share for the quarter ended September 30, 2010, compared to a net loss of $(37,000) or $0.00 per share for the same quarter of the prior year.

The proceeds of the Settlement Agreement and the extension of royalty payments from Lumenis through July 2014, will, in addition to increasing our cash position, enable us to more actively support our sales efforts for our current products and, perhaps, conduct limited testing of two new, patented fiber-optic devices, one of which has already been cleared for sale by the FDA.

Trimedyne manufactures proprietary Holmium lasers and patented fiber optic laser devices for vaporizing prostate tissue to treat BPH, vaporizing spinal disc tissue to treat herniated or ruptured discs and in a variety of other, minimally invasive procedures, many of which are performed on an outpatient basis at substantially less cost than conventional surgery. For product, press release, financial, SEC Reports and other information, please visit Trimedyne's website, http://www.trimedyne.com.

"Safe Harbor" Statement Under the Private Securities Litigation Reform Act:

Statements in this news release may contain forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934, including words like "expect," "may," "could" and others. Such statements may involve various risks and uncertainties, some of which may be discussed in the Company's current Form 10-K Report and subsequently filed SEC reports. There is no assurance such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.



                     TRIMEDYNE, INC. AND SUBSIDIARIES
                       CONSOLIDATED BALANCE SHEETS

                         ASSETS
                                                  As of September 30,
                                              ----------------------------
                                                  2010            2009
                                              ------------     -----------

Current assets:
  Cash and cash equivalents                   $  2,528,000    $  1,621,000
  Trade accounts receivable, net of
   allowance for doubtful accounts of
   $11,000 and $12,000, respectively               691,000         988,000
  Inventories                                    2,613,000       2,266,000
  Other current assets                             177,000         226,000
                                              ------------    ------------
      Total current assets                       6,009,000       5,101,000

Property and equipment, net                        908,000       1,168,000
Other                                              102,000          87,000
Goodwill                                           544,000         544,000
                                              ------------    ------------
                                              $  7,563,000    $  6,900,000
                                              ============    ============

            LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable                            $    129,000    $    449,000
  Accrued expenses                                 588,000         497,000
  Deferred revenue                                  75,000         100,000
  Accrued warranty                                  17,000          54,000
  Income tax payable                                11,000          20,000
  Current portion of note payable and
   capital leases                                  161,000         209,000
  Accrued interest due to related party              3,000              --
                                              ------------    ------------
    Total current liabilities                      984,000       1,329,000

Senior secured convertible note to related
 party, net of discount of $99,000                 401,000              --
Note payable and capital leases, net of
 current portion                                    92,000         232,000
Deferred rent                                       80,000          51,000
Derivative liabilities                              96,000              --
                                              ------------    ------------

    Total liabilities                            1,653,000       1,612,000
                                              ------------    ------------
Commitments and contingencies

Stockholders' equity:
  Preferred stock - $0.01 par value,
   1,000,000 shares authorized, none issued
   and outstanding                                      --              --
  Common stock - $0.01 par value; 30,000,000
   shares authorized, 18,467,569 shares
   issued, 18,365,960 shares outstanding at
   September 30, 2010 and 2009                     186,000         186,000
  Additional paid-in capital                    51,238,000      51,461,000
  Accumulated deficit                          (44,801,000)    (45,646,000)
                                              ------------    ------------
                                                 6,623,000       6,001,000
  Treasury stock, at cost (101,609 shares)        (713,000)       (713,000)
                                              ------------    ------------

    Total stockholders' equity                   5,910,000       5,288,000
                                              ------------    ------------

                                              $  7,563,000    $  6,900,000
                                              ============    ============





                    TRIMEDYNE, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF OPERATIONS

                         Three Months Ended             Year Ended
                           September 30,               September 30,
                      ------------------------  --------------------------
                         2010        2009          2010          2009
                      -----------  -----------  ------------  ------------
Net Revenues          $ 1,505,000  $ 2,112,000  $  6,401,000  $  7,422,000
Cost of sales:          1,224,000    1,237,000     4,197,000     4,637,000
                      -----------  -----------  ------------  ------------
Gross profit          $   281,000  $   875,000     2,204,000  $  2,785,000

Selling, general
 and administrative
 expenses                 669,000      641,000     2,585,000     2,683,000
Research and
 development expenses     185,000      385,000     1,060,000     1,316,000
                      -----------  -----------  ------------  ------------

Loss from operations  $  (573,000) $  (151,000) $ (1,441,000) $ (1,214,000)

Other income, net       1,884,000      134,000     2,095,000       333,000
                      -----------  -----------  ------------  ------------

Loss before provision
 for income taxes     $ 1,311,000  $   (17,000) $    654,000  $   (881,000)

Provision for income
 taxes                      3,000       20,000        15,000        28,000
                      -----------  -----------  ------------  ------------

Net loss              $ 1,308,000  $   (37,000) $    639,000  $   (909,000)
                      ===========  ===========  ============  ============

Basic net income
 (loss) per share     $      0.07  $     (0.00) $       0.04  $      (0.03)
                      ===========  ===========  ============  ============

Diluted net income
 (loss) per share                  $     (0.00) $       0.03  $      (0.05)
                      ===========  ===========  ============  ============
Basic weighted
 average common
 shares outstanding:   18,365,960   18,365,960    18,365,960    18,365,960
                      ===========  ===========  ============  ============

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