SOURCE: Trimedyne, Inc.

August 23, 2011 09:30 ET

Trimedyne Reports Its Financial Results for the Quarter Ended June 30, 2011

LAKE FOREST, CA--(Marketwire - Aug 23, 2011) - Trimedyne, Inc. (OTCQB: TMED) (OTCBB: TMED) today reported its financial results for the quarter ended June 30, 2011.

Revenues for the current quarter were $1,409,000, a decrease of 7.0% from revenues of $1,515,000 for the prior year's quarter. The $106,000 decrease in revenues was due to the current worldwide downward economic trend impacting sales of medical products used in elective procedures. The Company had a net loss of $429,000 or $0.02 per share, based on a weighted average of 18,395,960 shares outstanding for the current quarter, compared to a loss of $62,000 or $0.00 per share, based on a weighted average of 18,365,960 shares outstanding for the prior year quarter.

For the nine month period ended June 30, 2011, revenues were $4,924,000, an increase of 1.0% from $4,896,000 for the same period of 2010. For the nine months ended June 30, 2011, the Company's net loss was $797,000 or $0.04 per share, based on a weighted average of 18,395,960 shares outstanding, a 19% increase from a net loss of $669,000 or $0.04 per share, based on a weighted average of 18,365,960 shares outstanding for the same nine month period of 2010.

Commenting on the financial results for the quarter, Marvin P. Loeb, Sc.D., Chairman of Trimedyne said, "The quarter ended June 30, 2011 was a difficult quarter for us due to the financial malaise throughout the world. However, we see signs that our business prospects are improving, and we hope our results for the quarter ended September 30, 2011 will enable us to close this fiscal year with improved financial results.

"We are carefully controlling costs and judicially devoting funds to the development of new products and expanding our sales organization. However, we cannot assure that we will be able to achieve or maintain sales growth or further reduce our costs."

Trimedyne manufactures proprietary Holmium lasers and patented fiber optic laser devices for vaporizing the prostate to treat BPH, vaporizing excess 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.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
ASSETS
June 30, 2011 September 30, 2010
Current assets:
Cash and cash equivalents $ 1,308,000 $ 2,528,000
Trade accounts receivable, net of allowance for doubtful accounts of $12,000 at June 30, 2011 and September 30, 2010 598,000 691,000
Inventories 2,686,000 2,613,000
Other current assets 190,000 177,000
Total current assets 4,782,000 6,009,000
Property and equipment, net 1,094,000 908,000
Other 63,000 102,000
Goodwill 544,000 544,000
Total Assets $ 6,483,000 $ 7,563,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 268,000 $ 129,000
Accrued expenses 467,000 588,000
Deferred revenue 43,000 75,000
Accrued warranty 35,000 17,000
Income tax payable 11,000 11,000
Current portion of note payable and capital leases 185,000 161,000
Current portion of note payable to related party 219,000 --
Accrued interest due to related party -- 3,000
Total current liabilities 1,228,000 984,000
Note payable and capital leases, net of current portion 33,000 92,000
Senior secured convertible note to related party, net of discount of $89,000 and $99,000, respectively` -- 401,000
Deferred rent 84,000 80,000
Derivative liabilities -- 96,000
Total liabilities 1,345,000 1,653,000
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 at June 30, 2011 and September 30, 2010, 18,365,960 shares outstanding at June 30, 2011 and September 30, 2010 186,000 186,000
Additional paid-in capital 51,263,000 51,238,000
Accumulated deficit (45,598,000 ) (44,801,000 )
5,851,000 6,623,000
Treasury stock, at cost (101,609 shares) (713,000 ) (713,000 )
Total stockholders' equity 5,138,000 5,910,000
Total liabilities and stockholder's equity $ 6,483,000 $ 7,563,000

See accompanying notes to condensed consolidated financial statements

TRIMEDYNE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended Nine Months Ended
June 30, June 30,
2011 2010 2011 2010
Net revenues $ 1,409,000 $ 1,515,000 $ 4,924,000 $ 4,896,000
Cost of sales 882,000 771,000 3,011,000 2,973,000
Gross profit 527,000 744,000 1,913,000 1,923,000
Operating expenses:
Selling, general and administrative 707,000 628,000 2,123,000 1,916,000
Research and development 248,000 254,000 629,000 875,000
Total operating expenses 955,000 882,000 2,752,000 2,791,000
Loss from operations (428,000 ) (138,000 ) (839,000 ) (868,000 )
Other income, net -- 79,000 47,000 211,000
Loss before provision for income taxes (428,000 ) (59,000 ) (792,000 ) (657,000 )
Provision for income taxes 1,000 3,000 5,000 12,000
Net loss $ (429,000 ) $ (62,000 ) $ (797,000 ) $ (669,000 )
Net loss per share:
Basic $ (0.02 ) $ (0.00 ) $ (0.04 ) $ (0.04 )
Diluted $ (0.02 ) $ (0.00 ) $ (0.04 ) $ (0.04 )
Weighted average number of shares outstanding:
Basic 18,395,960 18,365,960 18,395,960 18,365,960
Diluted 18,395,960 18,365,960 18,395,960 18,365,960

See accompanying notes to condensed consolidated financial statements

TRIMEDYNE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Nine Months Ended
June 30,
2011 2010
Cash flows from operating activities:
Net loss $ (797,000 ) $ (669,000 )
Adjustments to reconcile net loss to net cash (used in) operating activities:
Stock-based compensation 25,000 13,000
Depreciation and amortization 226,000 246,000
Gain on change in fair value of derivative liabilities (43,000 ) (29,000 )
Loss on disposal of assets 3,000 2,000
Loss on extinguishment of debt and derivative liabilities 36,000 --
Changes in operating assets and liabilities:
Trade accounts receivable 93,000 268,000
Inventories (73,000 ) (715,000 )
Other assets 26,000 93,000
Accounts payable 139,000 (151,000 )
Accrued expenses (121,000 ) (9,000 )
Income tax payable -- 1,000
Deferred revenue (32,000 ) (9,000 )
Accrued warranty 18,000 (28,000 )
Deferred rent 4,000 (10,000 )
Accrued interest related party note (3,000 ) --
Net cash (used in) operating activities (499,000 ) (997,000 )
Cash flows from investing activities:
Purchase of property and equipment (415,000 ) (30,000 )
Net cash (used in) investing activities (415,000 ) (30,000 )
Cash flows from financing activities:
Proceeds from note payable to related party 250,000 --
Payments on note payable to related party (31,000 ) --
Payments on senior secured note to related party (500,000 ) --
Payments on notes payable and capital leases (25,000 ) (188,000 )
Net cash (used in) financing activities (306,000 ) (188,000 )
Net (decrease) in cash and cash equivalents (1,220,000 ) (1,215,000 )
Cash and cash equivalents at beginning of period 2,528,000 1,621,000
Cash and cash equivalents at end of period $ 1,308,000 $ 406,000

Supplemental disclosure of cash flow information:

Cash paid for income taxes during the nine months ended June 30, 2011 and 2010 was $2,000 and $12,000 respectively.

Cash paid for interest during the nine months ended June 30, 2011 and 2010 was approximately $53,000 and $26,000, respectively.

Supplemental disclosure of non-cash investing activity:

During the nine months ended June 30, 2011 and 2010, the Company financed the purchase of certain insurance policies with a $136,000 and a $60,000 note respectively.

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