Vycor Medical (VYCO) 8-K Vycor Medical Releases Financial Results for the three and six months ended June 30st, 2015

Exhibit 99.1

Vycor Medical Releases Financial Results for the three and six months ended June 30st, 2015

BOCA RATON, FL (August 14, 2015) – Vycor Medical, Inc. (Vycor) (OTCQB: VYCO), a provider of innovative and superior surgical and therapeutic solutions,reported financial results for the second quarter and first half ended June 30, 2015.

Operational Highlights

NovaVision

●   Launched NovaVision’s new Internet-delivered therapy suite in the U.S. This therapy suite consists of two highly complementary therapies: Vision Restoration Therapy (VRT), the only FDA-approved medical therapy aimed at the restoration of vision lost as a result of neurological damage, and NeuroEyeCoach, an eye-movement compensation therapy. The suite is delivered directly to patients’ computers over the Internet.

●   Expanded its agreement with HealthSouth, one of the nation’s largest providers of post-acute healthcare services, to make available its NeuroEyeCoach Professional Center therapy program to participating HealthSouth hospitals, following a three-month trial of the therapy in two locations. In late 2014, the company previously announced its agreement with HealthSouth to offer its VIDIT device, the diagnostic component of VRT, to its network of 100+ rehabilitation centers in the U.S. HealthSouth now has approved NovaVision’s entire Professional Center product range to be offered to its hospitals.

●   Launched a Professional Physician version of NovaVision’s Internet-delivered therapy suite, enabling physicians to register patients at the clinic and monitor patient reports and progress via a dedicated portal while patients complete NovaVision therapy from the comfort of their home.

ViewSite Brain Access System (VBAS)

●   VBAS, a next generation retraction and access system for brain surgery, has continued to gain traction through product approval in 16 new U.S. hospitals this year. VBAS is now approved in more than 200 hospitals in the U.S. with additional hospital approvals in process.

●   Five peer reviewed studies in 2015 provided important additional scientific data on VBAS’ clinical advantages:

-   Two papers by surgeons at Weill Cornell Medical College detailed their work on minimally invasive neurosurgical approaches using VBAS published in March 2015, including one published in the prestigious Journal of Neurosurgery which featured VBAS on its front cover;

-   Surgeons from Sapporo Medical University in Japan published a study of 18 patient surgeries using VBAS, which focused on the increased safety of rigid endoscope resection through VBAS;

-   Surgeons from Taipei Medical University published a paper on endoscopic hematoma evacuation using VBAS; and

-   Most recently, a study by surgeons at the Walter Reed National Military Medical Center, entitled: “Use of Minimally Invasive Retractor System for Retrieval of Intracranial Fragments in Wartime Trauma,” was published in World Neurosurgery. The study focused on the safe removal of shrapnel, bullets and bone fragments using VBAS. The study concluded that deep parenchymal and intraventricular fragments can be safely removed using VBAS. Peer reviewed clinical data is very important in driving surgeon and hospital adoption which in turn drives revenues.

Management Commentary

Peter Zachariou, Chief Executive Officer of Vycor, commented: “We continue to make progress with our VBAS product and the continuing clinical studies together with the anticipated launch of the smaller VBAS models makes us confident this will translate into increased VBAS penetration and greater market acceptance. NovaVision addresses a substantial and largely unaddressed market opportunity. The delayed launch of the Internet-delivered therapy suite and professional models has impacted revenues, but with their launch NovaVision is now positioned, for the first time, with the range of therapies and product offerings to deliver on our strategic vision: to provide a clinically supported, affordable and scalable visual therapy solution offering broad benefits to those suffering visual impairment following neurological damage; and to offer solutions for patients, physicians and rehab centers alike”.

Second Quarter 2015 Financial Results

Revenue in the second quarter of 2015 totaled $286,000, a decrease of $13,000 versus the same year-ago quarter. Vycor Medical revenue in the second quarter of 2015 was $221,000, an increase of $18,000 over the same year-ago quarter. NovaVision revenues in the second quarter of 2015 were $65,000, a decrease of $31,000 from the same year-ago quarter. NovaVision revenues were impacted by the delayed launch of the new Internet-delivered therapy suite, which was commercially launched on June 25, 2015. In addition, the decrease in total NovaVision revenues was partly attributed to the impact of foreign exchange differences in the translation of revenues from NovaVision’s European subsidiaries.

Non-GAAP operating expenses in the second quarter of 2015 were $601,000, as compared to $680,000 in the same period of 2014.

Non-GAAP net operating loss in the second quarter of 2015 was $349,000, a decrease of 16% from $417,000 in the same period of 2014.

Non-GAAP net loss in the second quarter of 2015 was $361,000, as compared to $463,000 in the same period of 2014.

The non-GAAP operating loss before depreciation and amortization (or “Cash Burn”) in the second quarter of 2015 was $321,000, as compared to $376,000 in the same period of 2014.

First Half 2015 Financial Results

Revenue in the first half of 2015 totaled $615,000, a decrease of $42,000 versus the same period in 2014. Vycor Medical revenue in the first half of 2015 was $480,000, an increase of $13,000 over the same year-ago period. NovaVision revenues in the first half of 2015 were $116,000, a decrease of $51,000. NovaVision revenues were impacted by the delayed launch of the new Internet-delivered therapy suite, which was commercially launched on June 25, 2015. In addition, the decrease of NovaVision revenues was in part attributed to the impact of foreign exchange differences in the translation of revenues from NovaVision’s European subsidiaries.

Non-GAAP operating expenses in the first half of 2015 totaled $1.3 million, unchanged from $1.3 million in the same period of 2014.

Non-GAAP net operating loss in the first half of 2015 was $811,000, as compared to $737,000 in the same period of 2014.

Non-GAAP net loss in the first half of 2015 was $834,000, as compared to $832,000 in the same period of 2014.

Non-GAAP operating loss before depreciation and amortization (or “Cash Burn”) in the first half of 2015 was $759,000, as compared to $662,000 in the same period of 2014.

Cash and cash equivalents were $1.0 million at June 30, 2015 and shareholders’ equity was $2.0 million.

VYCOR MEDICAL, INC.

Segment Information

(unaudited)

	Three months ended				Six months ended
	June 30,				June 30,
	2015		2014		2015		2014
Revenue
Vycor Medical	$	221,258	$	203,191	$	480,107	$	466,902
NovaVision		64,760		95,349		134,463		189,760
Total Revenue	$	286,018	$	298,540	$	614,570	$	656,662
Gross Profit
Vycor Medical	$	193,743	$	177,717	$	412,794	$	411,198
NovaVision		58,294		85,056		116,102		166,812
Total Gross Profit	$	252,037	$	262,773	$	528,896	$	578,010

Reconciliation of Non-GAAP Information and Pro Forma Balance Sheet

Non-GAAP Reconciliation

Management uses certain non-GAAP financial measures (including non-GAAP operating expenses and non-GAAP net loss and loss per share), which exclude non-cash amortization of acquired intangible assets, non-cash stock-based compensation, one-time Offering costs and the change in value of derivative warrant liability. Management does not consider these costs in evaluating the continuing operations of the Company. Therefore, management calculates the non-GAAP financial measures provided in this earnings release excluding these costs and uses these non-GAAP financial measures to enable it to analyze further, and more consistently, the period-to-period financial performance of its core business operations. Management believes that providing investors with these non-GAAP measures gives them additional important information to enable them to assess, in the same way management assesses, the Company’s current and future continuing operations. There are limitations in using these non-GAAP financial measures because they are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider non-GAAP financial measures only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP. Set forth below are reconciliations of the non-GAAP financial measures to the comparable GAAP financial measures.

On a GAAP basis the Company reported Operating Expenses for the second quarter of 2015 of $710,130, a net operating loss of $458,093 and a net loss of $420,267. For the first six months the Company reported Operating Expenses of $1,595,307, a net operating loss of $1,066,411 and a net loss of $1,144,448.

Vycor’s GAAP operating costs for the three months ended June 30, 2015 include non-cash amortization of acquired intangible assets ($58,617) and non-cash stock compensation charges ($50,312). Vycor’s other expense includes change in the value of warrant derivative liability (gain of $31,945) and gain on foreign currency exchange ($17,723).

Vycor’s GAAP operating costs for the six months ended June 30, 2015 include non-cash amortization of acquired intangible assets ($117,234) and non-cash stock compensation charges ($138,462). Vycor’s other expense includes change in the value of warrant derivative liability (gain of $19,792) and loss on foreign currency exchange ($74,148).

The Company is providing additional non-GAAP financial measures that exclude these charges and expenses, and reconciliation of GAAP to non-GAAP results is provided in the tables included in this release.

On a non-GAAP basis, taking into account these adjustments, Operating Expenses for the three months ended June 30, 2015 were $601,202, non-GAAP net operating loss was $349,165, and non-GAAP net loss was $361,006.

On a non-GAAP basis, taking into account these adjustments, Operating Expenses for the six months ended June 30, 2015 were $1,339,611, non-GAAP net operating loss was $810,714, and non-GAAP net loss was $834,396.

VYCOR MEDICAL, INC.

Consolidated Balance Sheets

(unaudited)

	June 30, 2015			December 31, 2014
ASSETS
Current Assets
Cash	$	1,010,718		$	1,891,658
Trade accounts receivable, net of allowance for doubtful accounts of $2,711 and $2,721		113,472			123,815
Inventory		285,289			336,021
Prepaid expenses and other current assets		186,343			217,800
Total Current Assets		1,595,822			2,569,294
Fixed assets, net		479,114			582,434
Intangible and Other assets:
Trademarks		251,157			251,157
Patents, net of accumulated amortization		368,036			345,113
Website, net of accumulated amortization		14,041			12,576
Security deposits		46,919			53,169
Total Intangible and Other assets		680,153			662,015
TOTAL ASSETS	$	2,755,089		$	3,813,743
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts payable	$	124,566		$	221,703
Accrued interest		64,436			40,634
Accrued liabilities		287,288			320,927
Derivative liability		-			19,792
Notes payable		315,307			321,785
TOTAL CURRENT LIABILITIES		791,597			924,841
STOCKHOLDERS’ EQUITY
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, 243,804 and 235,560 issued and outstanding as at June 30, 2015 and December 31, 2014 respectively	$	24		$	24
Common Stock, $0.0001 par value, 25,000,000 shares authorized 10,941,783 and 10,879,899 shares issued and 10,838,449 and 10,776,565 outstanding at June 30, 2015 and December 31, 2014 respectively		1,094			1,088
Additional Paid-in Capital		24,124,693			23,903,793
Treasury Stock (103,334 shares of Common Stock as of June 30, 2015 and December 31, 2014 respectively, at cost)		(1,033	)		(1,033	)
Accumulated Deficit		(22,309,012	)		(21,082,118	)
Accumulated Other Comprehensive Income		147,726			67,148
Total Stockholders’ Equity		1,963,492			2,888,902
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	2,755,089		$	3,813,743

VYCOR MEDICAL, INC.

Consolidated Statements of Comprehensive Loss

(unaudited)

	For the three months ended June 30,						For the six months ended June 30,
	2015			2014			2015			2014
Revenue	$	286,018		$	298,540		$	614,570		$	656,662
Cost of Goods Sold		33,981			35,767			85,674			78,724
Gross Profit		252,037			262,773			528,896			577,938
Operating expenses:
Research and development		15,672			37,395			38,898			52,751
Depreciation and Amortization		86,708			98,997			169,357			193,093
General and administrative		607,750			829,989			1,387,052			2,028,240
Total Operating expenses		710,130			966,381			1,595,307			2,274,084
Operating loss		(458,093	)		(703,608	)		(1,066,411	)		(1,696,146	)
Other Income (Expense)
Interest expense – Related Party		-			(33,613	)		-			(67,442	)
Interest expense -  Other		(11,842	)		(12,327	)		(23,682	)		(26,621	)
Gain (loss) on foreign currency exchange		17,723			(5,560	)		(74,147	)		(6,193	)
Change in fair value derivative liability		31,945			(523,277	)		19,792			(269,993	)
Total Other expense		37,826			(569,217	)		(78,038	)		(364,056	)
Loss before Provision for Income Taxes	$	(420,267	)	$	(1,278,385	)	$	(1,144,448	)	$	(2,066,395	)
Provision for Income Taxes
Net Loss	$	(420,267	)	$	(1,278,385	)	$	(1,144,448	)	$	(2,066,395	)
Preferred Dividends		-			-			(82,446	)		-
Net Loss available to common shareholders	$	(420,267	)	$	(1,278,385	)	$	(1,266,894	)	$	(2,066,395	)
Comprehensive Loss
Foreign Currency Translation    Adjustment		19,076			5,905			(80,577	)		6,427
Net Comprehensive Loss	$	(401,191	)	$	(1,272,480	)	$	(1,307,471	)	$	(2,059,968	)
Loss Per Share
Basic and diluted	$	(0.04	)	$	(0.12	)	$	(0.11	)	$	(0.21	)
Weighted Average Number of Shares Outstanding		10,819,691			10,570,609			10,806,338			9,787,198

VYCOR MEDICAL, INC.

Non-GAAP Reconciliation of Operating Loss and Net Loss

	Three months ended June 30,						Six months ended June 30,
	2015			2014			2015			2014
GAAP Operating Expenses	$	710,131		$	966,381		$	1,595,306		$	2,274,084
Non-cash amortization of acquired intangible assets (1)		(58,617	)		(58,617	)		(117,234	)		(117,234	)
Non-cash stock-based compensation (2)		(50,312	)		(91,073	)		(138,462	)		(259,727	)
Offering Costs (3)		-			(137,163	)		-			(581,702	)
Total Non-GAAP Operating Expense Adjustments		(108,929	)		(286,853	)		(255,696	)		(958,663	)
Non-GAAP Operating Expenses	$	601,202		$	679,528		$	1,339,611		$	1,315,421
GAAP Operating Loss	$	(458,094	)	$	(703,608	)	$	(1,066,410	)	$	(1,696,146	)
Non-GAAP Operating Expense Adjustments, as above		108,929			286,853			255,696			958,663
Non-GAAP Operating Loss	$	(349,165	)	$	(416,755	)	$	(810,714	)	$	(737,483	)
GAAP Net Loss	$	(420,267	)	$	(1,278,385	)	$	(1,144,448	)	$	(2,066,395	)
Non-GAAP Operating Expense Adjustments, as above		108,929			286,853			255,696			958,663
Change in value of derivative liability (4)		(31,945	)		523,277			(19,792	)		269,993
Gain (loss) on foreign currency exchange (5)		(17,723	)		5,560			74,148			6,193
Non-GAAP Net Loss	$	(361,006	)	$	(462,695	)	$	(834,396	)	$	(831,546	)
Non-GAAP Loss Per Share
Basic and diluted	$	(0.03	)	$	(0.04	)	$	(0.08	)	$	(0.08	)
Weighted Average Number of Shares Outstanding		10,819,691			10,570,609			10,806,338			9,787,198
Non-GAAP Operating Loss Before Depreciation And Amortization	$	(321,074	)	$	(376,376	)	$	(758,592	)	$	(661,625	)

(1) Non-Cash Amortization on acquired intangible assets. These are non-cash charges related to acquired intangible assets such patents and software which can be impacted by the timing and magnitude of acquisitions. We consider our operating results without these charges when evaluating our ongoing costs and performance, and therefore exclude such charges when presenting non-GAAP financial measures.

(2) Non-Cash Stock-based compensation expense consists of expense relating to stock-based awards issued to employees, outside directors and non employees including stock options, restricted common stock, and warrants. Because of varying available valuation methodologies, subjective assumptions and the fact that these amounts vary in size and timing, we believe that the exclusion of stock-based compensation expense allows for a more accurate comparison of our financial results to previous periods. In addition, we believe it is useful to investors to understand the specific impact of stock-based compensation expenses on our operating results.

(3) Offering Costs comprises the broker commissions, banking fees, legal fees and other costs associated with the five separate closings of an offering of units of Common Stock and Warrants (the "Offering") during the period January to April, 2014. These costs are one-time for the period of the Offering and are disregarded by management in evaluating and predicting earnings trends and are therefore excluded by us when presenting non-GAAP financial measures.

(4) Derivative Liability: Warrant. The Company accounted for the remaining 34,723 Series A Warrants issued in connection with the Offering which still carried anti-dilution rights in accordance with the guidance contained in ASC 815-40-15-7D, whereby under that provision, because they had anti-dilution rights, they did not meet the criteria for equity treatment and must be recorded as a liability. Accordingly, the Company classified the warrant instrument as a liability at its fair value and adjusted the instrument to fair value at each reporting period. This liability was subject to re-measurement at each balance sheet date until exercised or until the anti-dilution provisions contained within the warrant agreements expire, and was classified in the balance sheet as a current liability. The anti-dilution provisions expired on June 11, 2015 and accordingly the liability has been extinguished. Because this treatment was limited in time and was calculated using subjective valuation assumptions, we believe that the exclusion of the derivative liability on the balance sheet, and the change in valuation on the statement of operations, allowed for a more accurate reflection of our financial result, and has therefore been excluded by us when presenting non-GAAP financial measures.

(5) Gain (loss) on foreign currency exchange comprises the fluctuations on the foreign exchange rates on the revaluation of monetary assets and liabilities denominated in currencies other than the local functional currency of the relevant subsidiary.  This includes third party receivables and payables as well as intercompany loans. All subsidiaries receive funding via intercompany loans that are denominated in US dollars and any changes to the relevant exchange of the local functional currency requires the company to recognize a transaction gain or loss.  Because these or gains or losses are non cash and unrealized we believe that the exclusion of the losses allow for a more accurate reflection of our financial results, and has therefore been excluded by us when presenting non-GAAP financial measures.

About Vycor Medical, Inc.

Vycor Medical (OTCQB: VYCO) is dedicated to providing the medical community with innovative and superior surgical and therapeutic solutions. The company has a portfolio of FDA cleared medical solutions that are changing and improving lives every day. The company operates two business units: Vycor Medical and NovaVision, both of which adopt a minimally or non-invasive approach.

For the latest information on the company, including media and other coverage, and to learn more, please go online at www.vycormedical.com, www.vycorvbas.com or www.novavision.com.

Safe Harbor Statement

Information in this document constitute forward-looking statements or statements which may be deemed or construed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words "forecast", "anticipate", "estimate", "project", "intend", "expect", "should", "believe", and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve, and are subject to known and unknown risks, uncertainties and other factors which could cause Vycor Medical's actual results, performance (financial or operating) or achievements to differ from the future results, performance (financial or operating) or achievements expressed or implied by such forward-looking statements. The risks, uncertainties and other factors are more fully discussed in Vycor Medical’s filings with the U.S. Securities and Exchange Commission. All forward-looking statements attributable to Vycor Medical herein are expressly qualified in their entirety by the above-mentioned cautionary statement. Vycor Medical disclaims any obligation to update forward-looking statements contained in this estimate, except as may be required by law.

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