ADLI American Medical Technologies Inc (CE)

American Medical Technologies, Inc. (OTCBB:ADLI) reported its financial results for the third quarter and first nine months of 2005 ended September 30, 2005. Those results, compared with results for the third quarter and first nine months of 2004, are as follows: -- Third-quarter revenues and royalties declined 19 percent from a year ago. Royalty proceeds and sales of the industrial-market products increased sharply, but were offset by lower sales of dental-market products as the company concentrated on the introduction of its new hydrobrasion(TM) dental products. -- Net loss was $0.04 per share diluted for the third quarter, compared with $0.02 per share diluted in the third quarter last year. -- Licensing royalties were $3,958 for the third quarter and $90,716 for the first nine months. Two new licensing agreements for the company's air-abrasion and hydrobrasion technologies are driving that highly profitable new revenue stream. American Medical Technologies reported revenues and royalties for the third quarter of $514,522, compared to $638,336 in the third quarter last year. The decrease in quarterly revenues and royalties included lower sales of dental-market products compared with the prior-year quarter, partly offset by higher industrial market sales. Third-quarter 2004 revenues included $35,100 from a since-discontinued subsidiary. Third-quarter net loss was $320,217, or $0.04 per share diluted, compared to a net loss of $161,897, or $0.02 per share diluted, in the third quarter of 2004. Cost-reduction measures adopted earlier this year led to a slight reduction in selling, general and administrative costs for the quarter. For the first nine months of 2005, revenues and royalties were $1.69 million, versus $1.62 million for the first nine months of 2004. Net loss for the first nine months of 2005 was $874,286, or $0.11 per share diluted, compared with a net profit of $578,406, or $0.06 per share diluted, for the first nine months of 2004. In addition to the items mentioned above, nine-months results also include an $41,450 charge for a change in the Company's inventory allowance and for writeoffs of obsolete parts. Nine-months 2004 earnings included a one-time gain of $1.6 million, or $0.18 per share, related to the sale of available-for-sale securities. "During the third quarter, we continued to demonstrate the advantages and revenue opportunities of our new hydrobrasion dental equipment, which offers improved patient comfort and greater speed for many common procedures, compared with traditional handpiece drills," said Roger Dartt, President and Chief Executive Officer of American Medical Technologies. "Our new hydrobrasion technology has received excellent feedback from thought leaders in the professional dentistry marketplace, and response at major trade shows has been very encouraging. Seminars on our new hydrobrasion technology taught by Dr. Ross Nash, Co-Founder of the Nash Institute for Dental Learning held at our booth during the trade show were well attended." Techniques for the new hydrobrasion technology will be taught at the Nash Institute for Dental Learning using two of American Medical Technologies' new machines. In 2005 American Medical Technologies has signed sales and licensing agreements that are expected to contribute to future growth and profitability. They include: -- non-exclusive license agreements with KaVo Dental GmbH, a worldwide manufacturer of dental equipment and ancillary products, and Danville Materials, Inc., a worldwide manufacturer of dental equipment and ancillary products, for use of AMT's patented air abrasion and hydro abrasion technologies. -- an agreement between the Company's industrial division, Texas Airsonics, and Bell Helicopter for the sale of machining units to be used in the manufacture of aerospace composites. -- an agreement with Becton, Dickinson and Co. to upgrade its Texas Airsonics equipment used to prepare, clean, and polish hypodermic needles. Becton, Dickinson and Co. is the third largest medical products and equipment company in the United States. The Company plans to augment its dental product line, to increase the number of independent sales representatives marketing its products, and to extend the market penetration of its industrial products through additional dealer representatives. "We will continue to concentrate on our core business of developing and marketing enhanced air abrasion products for the dental and industrial markets, while leveraging our patented technologies through high-margin licensing agreements," Dartt said. "I anticipate renewed growth across our business in 2006." AMT, headquartered in Corpus Christi, Texas, develops and manufactures advanced technologies in the field of dentistry and markets them worldwide. The company's securities are quoted on the OTC Bulletin Board under the symbol ADLI, and its website is at www.americanmedicaltech.com. The Company makes forward-looking statements in this press release and in its filings with the Securities and Exchange Commission. The Company's forward-looking statements are subject to risks and uncertainties and include information about its expectations and possible or assumed future results of operations. When the Company uses any of the words "believes", "expects", "anticipates", "estimates" or similar expressions, it is making forward-looking statements. To the extent available to it, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 for all of its forward-looking statements. While the Company believes that its forward-looking statements are reasonable, you should not place undue reliance on any such forward-looking statements, which speak only as of the date made. Because these forward-looking statements are based on estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond the Company's control or are subject to change, actual results could be materially different. Factors that might cause such a difference include, without limitation, the following: the Company's inability to generate sufficient cash flow to meet its current liabilities, the Company's potential inability to hire and retain qualified sales and service personnel, the potential for an extended decline in sales, the possible failure of revenues to offset additional costs associated with its change in business model, the potential lack of product acceptance, the Company's potential inability to introduce new products to the market, the potential failure of customers to meet purchase commitments, the potential loss of customer relationships, the potential failure to receive or maintain necessary regulatory approvals, the extent to which competition may negatively affect prices and sales volumes or necessitate increased sales expenses, and the other risks and uncertainties. Other factors not currently anticipated by management may also materially and adversely affect the Company's results of operations. Except as required by applicable law, the Company does not undertake any obligation to publicly release any revisions which may be made to any forward-looking statements to reflect events or circumstances occurring after the date of this report. -0- *T American Medical Technologies, Inc. Condensed Consolidated Statements of Operations (Unaudited) Three Months Ended Nine Months Ended September 30 September 30 ---------------------- ---------------------- 2005 2004 2005 2004 ---------- ---------- ---------- ---------- Revenues $ 510,564 $ 638,855 $1,601,879 $1,623,235 Royalties 3,958 (519) 90,716 1,413 ---------- ---------- ---------- ---------- 514,522 638,336 1,692,595 1,624,648 Cost of sales 353,237 349,411 896,080 802,631 ---------- ---------- ---------- ---------- Gross profit 161,285 288,925 796,515 822,017 Selling, general and administrative 488,061 488,957 1,635,356 1,901,788 Research and development 54,389 39,309 131,248 127,860 ---------- ---------- ---------- ---------- Loss from operations (381,165) (239,341) (970,089) (1,207,631) Other income (expenses) Gain on sale of available for sale securities -- -- -- 1,642,050 Net realized and unrealized loss on investments (1,964) (23,033) (9,488) (88,712) Gain on sale of machinery 86,062 -- 86,062 -- Other income 641 100,717 64,465 261,564 Interest expense (33,017) (28,503) (78,469) (86,300) Interest income 9,226 28,263 33,233 57,435 ---------- ---------- ---------- ---------- Net income(loss) (320,217) (161,897) (874,286) 578,406 Preferred dividends -- -- -- (47,671) ---------- ---------- ---------- ---------- Net income(loss) available to common stockholders $ (320,217) $(161,897) $ (874,286) $ 530,735 ---------- ---------- ---------- ---------- Basic earnings per common share $ (0.04) $ (0.02) $ (0.11) $ 0.07 ---------- ---------- ---------- ---------- Diluted earnings per common share $ (0.04) $ (0.02) $ (0.11) $ 0.06 ---------- ---------- ---------- ---------- *T