Milestone Scientific Achieves Net Profitability in First Quarter 2010

Net Income Totaled $84,000 on Revenues of $2.56 Million; Company Posts Nearly $250,000 in Positive Cash Flow from Operations

PISCATAWAY, N.J., May 13 /PRNewswire-FirstCall/ -- Milestone Scientific Inc. (OTC Bulletin Board: MLSS), the recognized leader in advanced injection technologies, today announced its financial and operational results for the three months ended March 31, 2010.

"2010 has started off remarkably strong, marked by Milestone achieving its first quarterly net profit from operations in 12 years.  Robust sales, higher profit margins and reduced expenses all contributed to our positive performance and helped to fuel strong positive cash flow for our Company. We are enormously proud of these financial accomplishments and are working very hard to make 2010 a profitable year," stated Leonard Osser, Chief Executive Officer of Milestone.  

Financial Highlights When Comparing Three Months Ended March 31, 2010 with Three Months Ended March 31, 2009:

  • Net income totaled $84,000, or $0.01 earnings per basic and diluted share, reflecting a notable improvement on a net loss of $562,000, or $0.05 loss per basic and diluted share.
  • Revenues climbed 16% to $2.56 million from $2.20 million.
    • International sales rose 85% to $1.34 million from $726,000.
    • U.S. sales declined 19% to $1.20 million from $1.48 million.
    • Disposable handpiece sales increased 39% to $1.94 million, up from $1.40 million.
    • Sales of instruments decreased 24% to $600,000 from $792,000.
  • Gross profit margin improved, rising to 65% from 58%.
  • Total operating expenses declined 9% to $1.63 million from $1.80 million.  

During the first three months of 2010, Milestone generated net cash of $248,000 from its operating activities, compared to using $200,000 in its operations during the same period in 2009.  As of March 31, 2010, Milestone had $2.15 million in cash and accounts receivables, working capital of $1.94 million, and total shareholders' equity of $2.92 million.  Based on the Company's history of losses, the financial statements continue to carry a going concern qualification.

Continuing, Osser added, "With the recently announced issuance of a Notice of Allowance from the U.S. Patent and Trademark Office for our self-administered, computer-controlled injection system, we intend to begin aggressively pursuing collaborative opportunities with major pharmas and medical technology companies to develop and commercialize what we believe can be a truly disruptive self-injection device for those requiring routine injections for treatment of chronic diseases.  This is an exciting and potentially meaningful opportunity for Milestone and one that should greatly complement our other product development efforts in the medical arena."

Milestone's executive management team will host a teleconference this afternoon, Thursday, May 13, 2010, beginning at 4:15 PM Eastern Time, and invites all interested parties to join them in a discussion regarding the Company's financial results, corporate progression and other meaningful developments.  The conference call can be accessed via telephone by dialing toll free 1-888-846-5003.  For those unable to participate at that time, a replay of the teleconference can be accessed domestically by dialing toll free 1-800-406-7325 and entering the passcode 4293219.  The replay will be available for 90 days.

FINANCIAL CHARTS TO FOLLOW





MILESTONE SCIENTIFIC INC. CONDENSED BALANCE SHEET


March 31, 2010


December 31, 2009


(Unaudited)



ASSETS




Current Assets:




Cash and cash equivalents

$                 1,218,027


$                1,029,129

Accounts receivable, net of allowance for doubtful accounts of $5,000

931,218


1,063,742

Inventories

965,341


804,736

Advances to contract manufacturer, current

733,183


151,995

Prepaid expenses and other current assets

496,240


254,501

    Total current assets

4,344,009


3,304,103

Advances to contract manufacturer, non current

326,020


311,230

Investment in distributor, at cost

76,319


76,319

Furniture, Fixtures & Equipment net of accumulated depreciation of $414,280




as of March 31 ,2010 and $395,630 as of December 31, 2009

78,546


77,353

Patents, net of accumulated amortization of $231,950 as of March 31, 2010




     and $211,539 as of December 31, 2009

966,600


947,315

Other assets

116,309


133,674

Total assets

$                 5,907,803


$                4,849,994





LIABILITIES AND STOCKHOLDERS' EQUITY




Current Liabilities:




Accounts payable

$                 1,951,678


$                1,154,013

Accrued interest - 6% note, current

92,000


$                               -

Accrued expenses and other payable

363,338


524,017

   Total current liabilities

2,407,016


1,678,030





Long-term Liabilities:




Accrued Interest - 6% note, non current

61,573


92,000

Accrued Interest - 12% note, non current

76,431


-

Notes Payable-net of discount of $10,458 and $11,157, respectively

439,542


438,843

   Total long-term liabilities

577,546


530,843





Commitments and Contingencies








Stockholders' Equity




Common stock, par value $.001; authorized 50,000,000 shares; 14,811,807 shares issued




692,498 shares to be issued and 14,778,474 shares outstanding as of March 31, 2010;




14,781,296 shares issued, 692,498 shares to be issued, and 14,747,962 shares outstanding




as of December 31, 2009

15,502


15,472

Additional paid-in capital

62,498,787


62,300,619

Accumulated deficit

(58,679,532)


(58,763,454)

Treasury stock, at cost, 33,333 shares

(911,516)


(911,516)

    Total stockholders' equity

2,923,241


2,641,121

Total liabilities and stockholders' equity

$                 5,907,803


$                4,849,994







MILESTONE SCIENTIFIC INC. RESULTS OF OPERATIONS

(Unaudited)





Product sales, net

$      2,562,578


$      2,204,819

Cost of products sold

900,712


916,550

Gross profit

1,661,866


1,288,269

Selling, general and administrative expenses

1,541,702


1,728,815

Research and development expenses

88,464


67,622

Total operating expenses

1,630,166


1,796,437

Income (loss) from operations

31,700


(508,168)

Other income (expense)




Other income

61,916


-

Interest expense

(9,343)


(47,403)

Amortization of debt issuance

(699)


(7,875)

Interest income

348


1,804

Total other income (expenses)

52,222


(53,474)

Net income (loss) applicable to common stockholders

$           83,922


$       (561,642)

Net income (loss) per share applicable to common stockholders -  




Basic  

$              0.01


$            (0.05)

Diluted

$              0.01


$            (0.05)

Weighted average shares outstanding and to be issued -  




Basic

13,875,278


12,458,115

Diluted

14,320,821


12,458,115



MILESTONE SCIENTIFIC INC.

CONDENSED STATEMENT OF CASH FLOWS (Unaudited)

Net income (loss)

$        83,922


$   (561,642)


Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:





Depreciation expense

18,651


15,503


Amortization of patents

20,410


18,281


Amortization of debt discount

699


7,875


Common stock and options issued for compensation, consulting





   and vendor services

124,718


220,992


Changes in operating assets and liabilities:





 Decrease (Increase) in accounts receivable

132,524


(172,787)


(Increase) Decrease in inventories

(160,605)


72,226


(Increase) Decrease to advances to contract manufacturer

(595,978)


125,160


(Increase) to prepaid expenses and other current assets

(168,259)


(10,920)


Decrease in other assets

17,365


-


Increase in accounts payable  

797,665


248,622


(Decrease) in accrued expenses

(22,675)


(163,567)


Net cash provided by (used in) operating activities

248,437


(200,257)


Cash flows from investing activities:





      Purchases of property and equipment

(19,844)


(30,131)


      Payment for patents rights

(39,695)


(12,609)


Net cash used in investing activities

(59,539)


(42,740)







NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

188,898


(242,997)


Cash and cash equivalents at beginning of period

1,029,129


743,665


Cash and cash equivalents at end of period

$   1,218,027


$     500,668


Supplemental disclosure of cash flow information:





             Income taxes paid

$          4,146


$         3,597


             Interest paid

$        24,000


$                 -


             Shares issued to employees in lieu of cash compensation

$          7,500


$     125,324


             Shares issued to settle accounts payable

$        43,000


$       42,000




About Milestone Scientific Inc.

Headquartered in Piscataway, New Jersey, Milestone Scientific is engaged in pioneering advanced computer-controlled injection technologies for the medical and dental markets; and currently sells its award-winning products through a global distribution network serving North America, Asia, Africa and Europe.  For more information on the STA System and other innovative Milestone products, please visit the Company's web sites found at www.milestonescientific.com and www.STAis4U.com.

Safe Harbor Statement

This press release contains forward-looking statements regarding the timing and financial impact of Milestone's ability to implement its business plan, expected revenues and future success.  These statements involve a number of risks and uncertainties and are based on assumptions involving judgments with respect to future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond Milestone's control. Some of the important factors that could cause actual results to differ materially from those indicated by the forward-looking statements are general economic conditions, failure to achieve expected revenue growth, changes in our operating expenses, adverse patent rulings, FDA or legal developments, competitive pressures, changes in customer and market requirements and standards, and the risk factors detailed from time to time in Milestone's periodic filings with the Securities and Exchange Commission, including without limitation, Milestone's Annual Report  for the year ended December 31, 2009. The forward looking-statements in this press release are based upon management's reasonable belief as of the date hereof.  Milestone undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

FOR MORE INFORMATION, PLEASE CONTACT:

Elite Financial Communications Group

Dodi Handy, President and CEO (Twitter: @dodihandy)

For Media Inquiries: Kathy Addison, Director, Elite Media Group (Twitter: @kathyaddison)

407-585-1080 or via email at [email protected]



SOURCE Milestone Scientific Inc.

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