CHATSWORTH, Calif. - (Business Wire) North American Scientific, Inc. (Nasdaq:NASI) today announced financial results for its fiscal first quarter ended January 31, 2008. For the first quarter of fiscal 2008, the Company reported revenues from continuing operations, excluding the discontinued operations of the NOMOS ® Radiation Oncology business, of approximately $4.3 million, an 11% increase over the first quarter of the prior year, and a net loss from continuing operations of $4.3 million, or $0.11 per share, compared to the net loss from continuing operations for the fist quarter of the prior fiscal year of $2.3 million, or $0.08 per share. “During the fiscal first quarter we achieved our tenth consecutive quarter of year-over-year growth in our Radiation Sources business,” said John B. Rush, President and Chief Executive Officer of North American Scientific. “Our Radiation Sources revenues grew 11% in the first fiscal quarter compared to last year. This growth was driven by a 30% increase in our prostate brachytherapy business, and was partially offset by a decline in our non-therapeutic products business which decreased 30% from a very strong quarter in the prior year. We believe we are well positioned to capitalize on the positive, emerging market dynamics and our strong relationships with our customers in our therapeutic business segments, which together should support growth in fiscal 2008 and beyond. “Regarding our new breast brachytherapy product, ClearPath™, we continue to execute our strategic plan that includes working closely with key medical opinion leaders as we prepare for commercialization of our new ClearPath HDR product in 2008,” continued Mr. Rush. “We recently met with our Physician Advisory Board to share with them the significant progress we have made in the development of our improved ClearPath product. We look forward to launching this product over the next quarter. The improvements on this commercial ClearPath product feature increased functionality and ease-of-use for radiation oncologists and surgeons.” First Quarter Financial Results For the first quarter of fiscal 2008, the Company reported revenues from continuing operations, excluding the discontinued operations of the NOMOS® Radiation Oncology business, of approximately $4.3 million compared with revenues from continuing operations of $3.9 million for the first quarter of fiscal 2007. The 11% increase from the prior year was due to a $0.8 million, or 30%, increase in sales of the Company’s brachytherapy seeds and accessories, partially offset by a $0.4 million, or 30%, decrease in non-therapeutic product sales which declined from very strong sales in the first quarter of the prior year. The net loss from continuing operations for the first quarter of fiscal 2008 was $4.3 million, or $0.11 per share, compared with the net loss from continuing operations for the first quarter of fiscal 2007 of $2.3 million, or $0.08 per share. The $2.0 million increase in the net loss from continuing operations was primarily due to $1.3 million increased interest expense on debt and amortization and adjustment of warrants issued in connection with the debt, $0.5 million increased spending on research and development related to ClearPath, and $0.3 million in increased legal expense related to ClearPath patents. At the end of the first quarter of fiscal 2008, the Company had $8.0 million in cash and cash equivalents, compared with $0.6 million at the end of fiscal year 2007. During the first quarter of fiscal 2008, the Company used $2.6 million cash in operating activities for continuing operations, compared with $3.0 million in the first quarter of the prior year. As of January 31, 2008 the Company had no interest-bearing debt outstanding. Our existing credit line expired and all amounts outstanding thereunder became due on February 1, 2008. We are currently discussing a new credit line with our bank, but no assurances can be given that this credit line will be obtained. ClearPath™ Breast Brachytherapy Update The ClearPath systems are intended to combine the ease-of-use benefits of balloon brachytherapy products with the customized dose planning benefits of the multi-catheter brachytherapy procedure into one device. This innovative combination is expected to allow more patients to access the shorter radiation treatment cycles offered through accelerated partial breast irradiation (APBI) when treated with the ClearPath Device. The ClearPath systems are placed in the patient through a single incision and are designed to adapt to the resection cavity, allowing for more conformal therapeutic radiation dose distribution following lumpectomy compared to other methods of APBI. ClearPath is designed to accommodate either high-dose, ClearPath-HDR™, or low-dose rate, ClearPath-CR™, treatment methods. The Company has received 510k approval from the United States FDA for both ClearPath-HDR and ClearPath-CR. Throughout the fourth quarter of fiscal 2007, the Company began clinical experience and collected data from human patient implants performed by key opinion leaders with the first generation ClearPath-HDR device. The Company has continued to work on product improvements during the first quarter of fiscal 2008 and plans several key developments and marketing activities designed to support the successful commercialization of the ClearPath™ products in fiscal 2008: Key ClearPath Development Activities planned in Fiscal 2008 - Complete development and introduce second generation ClearPath-HDR products that increase functionality and ease-of-use
- Introduce the first generation ClearPath-CR (continuous release) products
- Strategically expand the Company’s distribution and sales organization to focus on ClearPath™ products
Conference Call Today The Company will host an investor conference call to review its fiscal first quarter 2008 financial results and latest corporate developments, beginning at 1:30 p.m. Pacific Time/4:30 p.m. Eastern Time on Wednesday, March 19, 2008. The dial-in number for the conference call is 800-798-2801 for domestic participants and 617-614-6205 for international participants. A live webcast of North American Scientific's conference call will be available over the Internet through its website at www.nasmedical.com in the Investor Center. For those who cannot listen to the live webcast, a taped replay of the call will be available beginning approximately one hour after the call’s conclusion and will remain available for seven days. It can be accessed at the same site shortly after the call, or by dialing 888-286-8010 for domestic callers and 617-801-6888 for international callers, using the passcode 79158387. About North American Scientific North American Scientific is a leader in radiation therapy in the fight against cancer. Its innovative products provide physicians with tools for the treatment of various types of cancers. They include Prospera® brachytherapy seeds and SurTRAK™ needles and strands used primarily in the treatment of prostate cancer. In addition, the Company has been gaining clinical experience with its first generation ClearPath™ multi-channel catheter breast brachytherapy devices in 2007, and intends to launch the second generation devices in 2008. They are the only such devices approved for both high dose and continuous release, or low dose, radiation treatments. The devices are designed to provide flexible, precise dose conformance and an innovative delivery system that is intended to offer the more advanced form of brachytherapy for the treatment of breast cancer. Please visit www.nasmedical.com for more information. Statements included in this release that are not historical facts may be considered forward-looking statements that are subject to a variety of risks and uncertainties. There are a number of important factors that could cause actual results to differ materially from those expressed in any forward-looking statements made by the Company including, but not limited to, the impact of competitive products and pricing, technological changes, changes in relationships with strategic partners and dependence upon strategic partners for the performance of critical activities under collaborative agreements, the ability of the Company to successfully directly market and sell its products, uncertainties relating to patent protection and regulatory approval, the stable supply of appropriate isotopes, research and development estimates, market opportunities, risks associated with strategic opportunities or acquisitions the Company may pursue and the risk factors included in the Company’s filings with the Securities and Exchange Commission. Any forward-looking statements contained in this news release speak only as of the date of this release, and the Company undertakes no obligation to revise or update any forward-looking statements, whether as a result of new information, future results or otherwise. | NORTH AMERICAN SCIENTIFIC, INC. Consolidated Balance Sheets | | | | | | | January 31, | | October 31, | | | 2008 | | 2007 | | | | | | | | (Unaudited) | | | | | | Assets | | | | | | | | | | | | | | | Current assets | | | | | | | | | Cash and cash equivalents | $ | 8,018,000 | | $ | 609,000 | | | Accounts receivable, net of reserves | | 2,199,000 | | | 2,296,000 | | | Inventories, net of reserves | | 1,509,000 | | | 1,546,000 | | | Prepaid expenses and other current assets | | 567,000 | | | 724,000 | | | | | | | | Total current assets | | 12,293,000 | | | 5,175,000 | | | Equipment and leasehold improvements, net | | 882,000 | | | 891,000 | | | Intangible assets, net | | 103,000 | | | 110,000 | | | | | | | | Total assets | $ | 13,278,000 | | $ | 6,176,000 | | | | | | | | Liabilities and Stockholders’ Equity (Deficit) | | | | | | | | | | | | | | | Current liabilities | | | | | | | | Lines of credit, net of discount | $ | — | | $ | 3,241,000 | | | Warrant derivative | | — | | | 173,000 | | | Accounts payable | | 1,924,000 | | | 2,564,000 | | | Accrued expenses | | 2,559,000 | | | 3,110,000 | | | | | | | | Total current liabilities | | 4,483,000 | | | 9,088,000 | | | | | | | | Commitments and contingencies | | | | | | | | | | | | | | | Stockholders’ Equity (Deficit) | | | | | | | | Preferred stock, $0.01 par value, 2,000,000 shares authorized; no shares issued | | | | | | | | | — | | | — | | | Common stock, $0.01 par value, 150,000,000 shares and 100,000,000 shares authorized; 92,641,876 and 29,601,352 shares issued; and 92,435,855 and 29,395,331 shares outstanding as of January 31, 2008 and October 31, 2007, respectively | | | | | | | | | 929,000 | | | 300,000 | | | Additional paid-in capital | | 160,415,000 | | | 145,533,000 | | | Treasury stock, at cost – 206,021 common shares as of January 31, 2008 and October 31, 2007, respectively | | (227,000 | ) | | (227,000 | ) | | Accumulated deficit | | (152,322,000 | ) | | (148,518,000 | ) | | | | | | | Total stockholders’ equity (deficit) | | 8,795,000 | | | (2,912,000 | ) | | | | | | | Total liabilities and stockholders’ equity (deficit) | $ | 13,278,000 | | $ | 6,176,000 | | | | | | | | | NORTH AMERICAN SCIENTIFIC, INC. Consolidated Statements of Operations (Unaudited) | | | | | | | | Three Months Ended January 31, | | | | | | 2008 | | | 2007 | | | | | | | | | | | | | | | | | | Total Revenue – net | $ | 4,337,000 | | | $ | 3,914,000 | | | | | | | | | | | Total cost of revenue | | 2,840,000 | | | | 2,498,000 | | | | | | | | | | Gross profit | | 1,497,000 | | | | 1,416,000 | | | | | | | | | | Operating expenses | | | | | | | | | Selling and marketing expenses | | 846,000 | | | | 928,000 | | | General and administrative expenses | | 2,838,000 | | | | 2,406,000 | | | Research and development | | 857,000 | | | | 379,000 | | | | | | | | | | Total operating expenses | | 4,541,000 | | | | 3,713,000 | | | | | | | | | | Loss from operations | | (3,044,000 | ) | | | (2,297,000 | ) | | Interest and other (expense) income | | (977,000 | ) | | | 18,000 | | | Adjustment to fair value of derivatives | | (311,000 | ) | | | — | | | | | | | | | | Loss before provision for income taxes | | (4,332,000 | ) | | | (2,279,000 | ) | | Provision for income taxes | | — | | | | — | | | | | | | | | | Loss from continuing operations | | (4,332,000 | ) | | | (2,279,000 | ) | | Loss from discontinued operations, net of tax benefits | | (63,000 | ) | | | (916,000 | ) | | | | | | | | Net loss | $ | (4,395,000 | ) | | $ | (3,195,000 | ) | | | | | | | | | | | | | | | | Basic and diluted loss per share: | | | | | | | | | Basic and diluted loss per share from continuing operations | $ | (0.11 | ) | | $ | (0.08 | ) | | Basic and diluted loss per share from discontinued operations | | — | | | | (0.03 | ) | | | | | | | | Basic and diluted loss per share | $ | (0.11 | ) | | $ | (0.11 | ) | | | | | | | | | | | | | | | | Weighted average number of shares outstanding | | 38,300,957 | | | | 29,329,016 | | | | | | | | North American Scientific, Inc.
John Rush, CEO
818-734-8600
IR@nasmedical.com
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