Vancouver, British Columbia – May 28, 2015 – LED Medical Diagnostics Inc. (“LED Medical” or the “Company”) today announced its financial results for the first quarter ended March 31, 2015, reported in United States dollars and in accordance with International Financial Reporting Standards (“IFRS”). The Company’s results are presented in comparison to the first quarter ended March 31, 2014. All balances are expressed in United States dollars unless otherwise stated.
“We have set the stage for a breakout year in 2015 and had a strong Q1 in line with our internal projections. Throughout the remainder of 2015, we plan to aggressively leverage our new operating infrastructure and optimize our cost structure as well,” stated Dr. David Gane CEO of LED Medical. “We are proud of our ability to attract world class imaging technology partners and the execution of our sales, marketing and support teams in growing our business in this exciting and vibrant market opportunity”. Gane added “The first quarter is seasonally one of low sales activity for capital equipment purchases in the North American dental market. This seasonality has been factored into our plan and we remain on track to achieve our revenue guidance.”
Notable business developments and achievements up to the reporting date included the following:
- On March 17, 2015, the Company announced the funding of an $8,000 gift to the University of British Columbia to support a research project titled “Prevention Strategies in Early Detection and Diagnosis of Oral Cancer in Vietnam”. This gift will fund the travel costs to Vietnam for two research trainers to deliver training for various levels of health professionals. Oral Cancer is one of the most common cancers in Vietnam, more than six times higher than for patient’s in the US and Canada.
- On April 9, 2015, the Company announced an agreement with OrthoSynetics which designates LED Dental as the preferred imaging technology supplier for their orthodontic practices. OrthoSynetics provides administrative, marketing and financial services for 350 orthodontic practices across the United States.
- On April 15, 2015, the Company announced a pilot program for oral cancer screenings at various London Drug pharmacies in the lower mainland of B.C. This program has been endorsed by the BC Oral Cancer Prevention Program.
- On April 21, 2015, the Company announced that it will be serving as a strategic partner in the Oral Cancer Foundation’s “Be Part of the Change” program, seeking to promote the importance of routine comprehensive oral screenings and early detection in the fight against oral cancer.
- On May 27, 2015, LED Board member Praveen Varshney announced that he has officially resigned from his post as Board member to pursue other business interests.
- The Company reported revenue of $2.4 million during the three months ended March 31, 2015 which represents an increase of 131% over the same period in the prior year of $1.1 million. The increase in revenue was due primarily to the Company’s expanded imaging product offering that complements its VELscope product offering.
- Gross margin was 30% during the three months ended March 31, 2015 which was lower than 50% gross margins in the same period in the prior year. The decline in gross margin was attributable to the change in revenue mix attributable to the Company’s imaging product offering.
- EBITDA was negative $1.3 million during the three months ended March 31, 2015 representing a increase from negative EBITDA of $1 million in the same period in the prior year.
- The Company had a net loss of $1.4 million during the three months ended March 31, 2015 compared to a net loss of $2.9 in the same period in the prior year.
Position as at March 31, 2015
Working capital as of March 31, 2015 was $2.3 million inclusive of cash and cash equivalents of $1.1 million.
Financial Guidance for Fiscal Year 2015
The Company is reaffirming guidance for the full fiscal year ending December 31, 2015 (“fiscal year 2015”). This guidance is intended solely to give investors an understanding of management’s expectations for the full fiscal year in light of recent industry sales trends, seasonality of the business and recognition that much of the sales generated in the dental industry occur in the fourth quarter. The guidance does not take into account, or give effect for, any events that are beyond the Company’s reasonable control.
Fiscal Year Ending December 31, 2015 – Quantitative Guidance
Revenue – $15 Million – $16 Million
Financial Statements and Management’s Discussion & Analysis
Please see the interim condensed financial statements and related Management Discussion and Analysis (MD&A) for more details. The interim condensed financial statements for the three months ended March 31, 2015 and related MD&A have been reviewed and approved by the Company’s Audit Committee and Board of Directors. The Company has prepared this truncated news release to alert investors to its results and that a more detailed explanation and analysis is readily available in the MD&A. These reports have been filed on SEDAR at www.sedar.com and also posted to www.ledmd.com.
The following and preceding discussion of financial results includes references to Gross Margin, EBITDA, Core Operating Expenses and Working Capital, which are non-IFRS financial measures. The measure of gross margin is provided as management believes this is a good indicator in evaluating the operating performance of the Company. EBITDA is defined as net loss and comprehensive loss and excludes interest; income taxes; depreciation; amortization; finder’s warrants issuance costs; stock-based compensation; deferred share unit compensation; mark to market adjustments on Canadian dollar denominated warrants; foreign exchange gain or loss; and other income. The measure of working capital is provided as management believes this is a good indicator of the operating liquidity available to the Company.
About LED Medical Diagnostics Inc.
Founded in 2003 and headquartered in Burnaby, British Columbia, Canada, LED Medical Diagnostics Inc., through its wholly-owned subsidiaries LED Dental Inc. and LED Dental Ltd, provide dentists and oral health specialists with advanced diagnostic imaging products and software, in addition to the award-winning VELscope® Vx tissue fluorescence visualization technology. Backed by an experienced leadership team and dedicated to a higher level of service and support, LED Dental is committed to providing dental practitioners with the best technology available by identifying and adding leading products to its growing portfolio.
The Company is currently listed on the TSX Venture Exchange (TSX-V) under the symbol “LMD”, the OTCQX under the symbol “LEDIF”, as well as the Frankfurt Stock Exchange under the symbol “LME”. For more information, call 844.952.7327 or visit www.leddental.com/investor-relations.