Trimedyne (TMED) 10-Q 19 Feb 14 2014 Q1 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	3 Months Ended
	Dec. 31, 2013	Feb. 17, 2014
Document And Entity Information	'	'
Entity Registrant Name	'TRIMEDYNE INC	'
Entity Central Index Key	'0000357001	'
Document Type	'10-Q	'
Document Period End Date	31-Dec-13	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--09-30	'
Is Entity a Well-known Seasoned Issuer?	'No	'
Is Entity a Voluntary Filer?	'No	'
Is Entity's Reporting Status Current?	'Yes	'
Entity Filer Category	'Smaller Reporting Company	'
Entity Common Stock, Shares Outstanding	'	18,395,960
Document Fiscal Period Focus	'Q1	'
Document Fiscal Year Focus	'2014	'

CONDENSED_CONSOLIDATED_BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)	Dec. 31, 2013	Sep. 30, 2013
Current assets:	'	'
Cash and cash equivalents	$1,599,000	$1,572,000
Trade accounts receivable, net of allowance for doubtful accounts of $11,000 at December 31, 2013 and September 30, 2013, respectively	518,000	475,000
Inventories	1,040,000	1,201,000
Other current assets	145,000	166,000
Total current assets	3,302,000	3,414,000
Property and equipment, net	785,000	706,000
Other	48,000	37,000
Goodwill	544,000	544,000
Total Assets	4,679,000	4,701,000
Current liabilities:	'	'
Accounts payable	232,000	177,000
Accrued expenses	454,000	416,000
Deferred revenue	74,000	37,000
Accrued warranty	25,000	16,000
Taxes Payable	8,000	8,000
Current portion of note payable and capital leases	74,000	49,000
Total current liabilities	867,000	703,000
Deferred rent	10,000	11,000
Capital lease, net of current portion	73,000	0
Total liabilities	950,000	714,000
Commitments and contingencies	'	'
Stockholders' equity:	'	'
Preferred stock - $0.01 par value, 1,000,000 shares authorized, none issued and outstanding	0	0
Common stock - $0.01 par value; 30,000,000 shares authorized, 18,497,569 shares issued, 18,395,960 shares outstanding at December 31, 2013 and September 30, 2013, respectively	186,000	186,000
Additional paid-in capital	51,309,000	51,308,000
Accumulated deficit	-47,053,000	-46,794,000
Stockholders' Equity before Treasury Stock	4,442,000	4,700,000
Treasury stock, at cost (101,609 shares)	-713,000	-713,000
Total stockholders' equity	3,729,000	3,987,000
Total liabilities and stockholder's equity	$4,679,000	$4,701,000

CONDENSED_CONSOLIDATED_BALANCE1

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Dec. 31, 2013	Sep. 30, 2013
Statement of Financial Position [Abstract]	'	'
Allowance for doubtful accounts	$11,000	$11,000
Preferred stock par value	$0.01	$0.01
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock par value	$0.01	$0.01
Common stock shares authorized	30,000,000	30,000,000
Common stock shares issued	18,497,569	18,497,569
Common stock shares outstanding	18,395,960	18,395,960
Treasury stock shares	101,609	101,609

CONSOLIDATED_STATEMENTS_OF_OPE

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	3 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Net revenues:	'	'
Net revenues	$1,399,000	$1,475,000
Cost of sales:	'	'
Cost of revenues	1,023,000	938,000
Gross profit	376,000	537,000
Operating expenses:	'	'
Selling, general and administrative	549,000	573,000
Research and development	124,000	126,000
Total operating expenses	673,000	699,000
Loss from operations	-297,000	-162,000
Other income, net	38,000	20,000
Loss before income taxes	-259,000	-142,000
Provision for income taxes	0	2,000
Net loss	($259,000)	($144,000)
Net loss per share - Basic	($0.01)	($0.01)
Net loss per share - Diluted	($0.01)	($0.01)
Weighted average number of shares outstanding - Basic	18,395,960	18,395,960
Weighted average number of shares outstanding - Diluted	18,395,960	18,395,960

CONSOLIDATED_STATEMENTS_OF_CAS

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	3 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Cash flows from operating activities:	'	'
Net loss	($259,000)	($144,000)
Adjustments to reconcile net loss to net cash used in operating activities:	'	'
Stock-based compensation	1,000	4,000
Depreciation and amortization	57,000	70,000
Changes in operating assets and liabilities:	'	'
Trade accounts receivable	-43,000	-134,000
Inventories	161,000	61,000
Other assets	13,000	22,000
Accounts payable	55,000	85,000
Accrued expenses	38,000	86,000
Income tax payable	0	2,000
Deferred revenue	37,000	16,000
Accrued warranty	9,000	-9,000
Deferred rent	-1,000	-16,000
Net cash provided by operating activities	68,000	43,000
Cash flows from investing activities:	'	'
Purchase of property and equipment	-4,000	-27,000
Net cash used in investing activities	-4,000	-27,000
Cash flows from financing activities:	'	'
Principal payments on note payable and capital leases	-37,000	-47,000
Net cash used by financing activities	-37,000	-47,000
Net increase (decrease) in cash and cash equivalents	27,000	-31,000
Cash and cash equivalents at beginning of period	1,572,000	472,000
Cash and cash equivalents at end of period	1,599,000	441,000
Supplemental disclosure of cash flow information:	'	'
Cash paid for income taxes	0	0
Cash paid for interest	3,000	1,000
Supplemental disclosure of non-cash investing activity:	'	'
Company financing of insurance policies	21,000	0
Company financing of IT infrastructure	$119,000	$0

1_Summary_Of_Significant_Accou

1. Summary Of Significant Accounting Policies	3 Months Ended
	Dec. 31, 2013
Accounting Policies [Abstract]	'
Summary Of Significant Accounting Policies	'
	Principles of Consolidation
	The accompanying condensed consolidated financial statements include the accounts of Trimedyne, Inc., a Nevada corporation, its wholly owned subsidiary, Mobile Surgical Technologies, Inc. ("MST"), a Texas corporation, and its 90% owned inactive subsidiary, Cardiodyne, Inc. ("Cardiodyne"), a Nevada corporation, (collectively, the "Company"). All intercompany accounts and transactions have been eliminated in consolidation.
	At December 31, 2013, we had working capital of $2,435,000 compared to $2,711,000 at the end of the previous fiscal year ended September 30, 2013. Cash increased by $27,000 to $1,599,000 at December 31, 2013 from $1,572,000 at the fiscal year ended September 30, 2013.
	Management's Plans
	The Company is currently pursuing market development efforts in Asia, Latin America and Eastern Europe. We believe that by expanding healthcare infrastructure in these markets we may be able to create a sustained demand for Holmium Lasers applied to Spinal Endoscopy and Laser Lithotripsy. Additionally, we expect the global trend toward single-use disposable laser delivery products will improve sales and profit margins as more hospitals convert from multi-use products, due to concerns for sterility and interests to reduce handling costs incurred in product sterilization, and we are developing more single-use products.
	Unaudited Interim Financial Information
	The accompanying unaudited condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America for interim financial information, and pursuant to the instructions to Form 10-Q promulgated by the Securities and Exchange Commission ("SEC"). Accordingly, they do not include all information and disclosures required by generally accepted accounting principles for complete financial statement presentation. In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the Company's consolidated financial position as of December 31, 2013 and the results of its operations and its cash flows for the three months ended December 31, 2013 and 2012. Results for the three months ended December 31, 2013 are not necessarily indicative of the results to be expected for the year ending September 30, 2014.
	Use of Estimates
	The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates and assumptions include inventory valuation, allowances for doubtful accounts and deferred income tax assets, recoverability of goodwill and long-lived assets and certain accrued liabilities.
	While management believes that the disclosures presented are adequate to make the information not misleading, it is suggested that these condensed consolidated financial statements be read in conjunction with the condensed consolidated financial statements and the notes included in the Company's 2013 annual report on Form 10-K for the year ended September 30, 2013.
	Stock-Based Compensation
	Stock-based compensation was $1,000 and $3,000 during the quarters ended December 31, 2013 and 2012, respectively. As of December 31, 2013, there was approximately $4,970 of total unrecognized compensation cost, net of estimated expected forfeitures, related to employee and director stock option compensation arrangements. This unrecognized cost is expected to be recognized on a straight-line basis over the next nine reporting periods.
	Per Share Information
	Basic per share information is computed based upon the weighted average number of common shares outstanding during the period. Diluted per share information consists of the weighted average number of common shares outstanding, plus the dilutive effects of options and warrants calculated using the treasury stock method. In loss periods, dilutive common equivalent shares are excluded as the effect would be anti-dilutive. During the three months ended December 31, 2013 and 2012, outstanding options of 818,900 and 997,650, respectively, were excluded from the diluted net loss per share as the effects would have been anti-dilutive. In addition, the exercise prices of these options were in excess of the average closing price of the Company’s common stock for the years ended December 31, 2013 and 2012.

2_Composition_Of_Certain_Balan

2. Composition Of Certain Balance Sheet Captions	3 Months Ended
	Dec. 31, 2013
Disclosure Text Block Supplement [Abstract]	'
Composition Of Certain Balance Sheet Captions	'
	Inventories, net of reserves, consist of the following:
		December 31,			September 30,
		2013			2013
	Raw materials	$	442,000		$	501,000
	Work-in-process		86,000			94,000
	Finished goods		512,000			606,000
		$	1,040,000		$	1,201,000
	For the three months ended December 31, 2013 and 2012, the aggregate net realizable value of demonstration and evaluation lasers did not comprise a material amount in inventories.
	Other current assets consist of the following:
		December 31,			September 30,
		2013			2013
	Royalty receivable	$	30,000		$	25,000
	Prepaid insurance		52,000			68,000
	Prepaid income tax		5,000			6,000
	Prepaid rent		13,000			13,000
	Short-term deposits		8,000			8,000
	Other		37,000			46,000
	Total other current assets	$	145,000		$	166,000
	Property and equipment consist of the following:
		December 31,			September 30,
		2013			2013
	Furniture and equipment	$	3,559,000		$	3,434,000
	Leasehold improvements		57,000			45,000
	Other		316,000			317,000
			3,932,000			3,796,000
	Less accumulated depreciation and amortization		(3,147,000	)		(3,090,000	)
	Total property and equipment	$	785,000		$	706,000
	Accrued expenses consist of the following:
		December 31,			September 30,
		2013			2013
	Accrued vacation	$	160,000		$	146,000
	Accrued salaries and wages		104,000			51,000
	Accrued compensation		–			55,000
	Accrued bonus		4,000			30,000
	Medical device tax		53,000			39,000
	Sales and use tax		52,000			52,000
	Customer deposits		2,000			2,000
	Commissions		45,000			23,000
	Other		34,000			18,000
	Total accrued expenses	$	454,000		$	416,000

3_Notes_Payable_and_Leases

3. Notes Payable and Leases	3 Months Ended
	Dec. 31, 2013
Debt Disclosure [Abstract]	'
Notes Payable and Leases	'
	Note payable and capital leases consist of the following:
		31-Dec-13
	Capital lease agreement in connection with the update of our IT infrastructure bearing an effective interest rate of 8.41% per annum. The lease requires monthly payments of $3,766 through October 2016 and is secured by the leased equipment.	$	110,000
	Finance agreement issued in connection with the purchasing of an insurance policy. The note bears interest at 3.6% per annum and requires monthly payments principal and interest payments of $1,796 through December 2015.		18,000
	Finance agreement issued in connection with the purchasing of insurance policies. The note bears interest at 3.35% per annum and require monthly principal and interest payments of $9,851 through March 2014.		19,000
		$	147,000
	Less: current portion		(74,000	)
		$	73,000

4_Commitments_And_Contingencie

4. Commitments And Contingencies	3 Months Ended
	Dec. 31, 2013
Commitments and Contingencies Disclosure [Abstract]	'
Commitments And Contingencies	'
	Litigation
	We are subject to various claims and actions that arise in the ordinary course of business. The litigation process is inherently uncertain, and it is possible that the resolution of any future litigation may adversely affect us.
	Guarantees and Indemnities
	The Company has made certain indemnities and guarantees, under which it may be required to make payments to a guaranteed or indemnified party. The Company indemnifies its directors, officers, employees and agents to the maximum extent permitted under the laws of the State of California. In connection with its facility leases, the Company has indemnified its users of lasers for certain claims arising from the use of the lasers. The duration of the guarantees and indemnities varies, and in many cases is indefinite. These guarantees and indemnities do not provide for any limitation of the maximum potential future payments the Company could be obligated to make. Historically, the Company has not been obligated to make any payments for these obligations and no liabilities have been recorded for these indemnities and guarantees in the accompanying condensed consolidated balance sheet.
	Risks and Uncertainties
	The Centers for Medicare and Medicaid Services (CMS), the agency of the U.S. Government that administers the Medicare Program, does not reimburse for thermal intradiscal procedures to treat spinal discs including the use of the Company's pulsed Holmium Lasers. Since most people suffering from a herniated or ruptured spinal disc are below Medicare age, we do not believe CMS's decision will have an adverse impact on our business.

5_Segment_Information

5. Segment Information	3 Months Ended																		12 Months Ended
	Dec. 31, 2013																		Sep. 30, 2013
Segment Reporting [Abstract]	'																		'
Segment Information	'																		'
	The Company's segments consist of individual companies managed separately with each manager reporting to the Chief Executive Officer. Revenues, and operating or segment profit, are reflected net of inter-segment sales and profits. Segment profit is comprised of net sales less operating expenses. Other income and expense and income taxes are not allocated and reported by segment since they are excluded from the measure of segment performance reviewed by management.																		The Company's segments consist of individual companies managed separately with each manager reporting to the Chief Executive Officer. Revenues, and operating or segment profit, are reflected net of inter-segment sales and profits. Segment profit is comprised of net sales less operating expenses. Other income and expense and income taxes are not allocated and reported by segment since they are excluded from the measure of segment performance reviewed by management.
	Data with respect to these operating activities for the three months ended December 31, 2013 and 2012 are as follows:																				For the year ended September 30, 2013									For the year ended September 30, 2012
																					Product			Service and Rental			Total			Product			Service and Rental		Total
		For the Three Months Ended									For the Three Months Ended
		31-Dec-13									31-Dec-12								Revenues	$	3,130,000		$	2,859,000		$	5,989,000		$	3,588,000		$	2,492,000	$	6,080,000
		Products			Service and Rental			Total			Products			Service and Rental		Total
																			Cost of sales		1,721,000			1,900,000			3,621,000			2,467,000			1,616,000		4,083,000
	Revenue	$	760,000		$	639,000		$	1,399,000		$	722,000		$	753,000	$	1,475,000
	Cost of sales		527,000			496,000			1,023,000			434,000			504,000		938,000		Gross profit		1,409,000			959,000			2,368,000			1,121,000			876,000		1,997,000
	Gross profit		233,000			143,000			376,000			288,000			249,000		537,000		Expenses:
																			Selling, general and administrative		1,647,000			682,000			2,329,000			1,872,000			622,000		2,494,000
	Expenses:																		Research and development		407,000			–			407,000			673,000			–		673,000
	Selling, general and administrative		391,000			158,000			549,000			407,000			166,000		573,000
	Research and development		124,000			–			124,000			126,000			–		126,000		Income (loss) from operations	$	(645,000	)	$	277,000			(368,000	)	$	(1,424,000	)	$	254,000		(1,170,000	)
	Income (loss) from operations	$	(282,000	)	$	(15,000	)		(297,000	)	$	(245,000	)	$	83,000		(162,000	)
																			Other income (expense):
	Other:																		Royalty income		98,000									116,000
	Interest expense								(3,000	)							(1,000	)	Interest expense		(2,000	)								(10,000	)
	Royalty income								30,000								17,000		Net gain on disposal of assets		8,000
	Other income								11,000								4,000		Net gain on sale of patents		--									200,000
	Provision for income tax								–								2,000		Settlements and other		610,000									41,000
	Net loss							$	(259,000	)						$	(144,000	)
																			Income (loss) before provision for income taxes		346,000									(823,000	)
	Sales and gross profit to customers by similar products and services for the three months ended December 31, 2013 and 2012 were as follows:
																			Provision for income taxes		17,000									13,000
		For the Three Months Ended
		December 31,																	Net income ( loss)	$	329,000								$	(836,000
		2013			2012
	By similar products and services:
	Revenues:																		Sales in foreign countries in fiscal 2013 and 2012 accounted for approximately 19.0% and 22.5%, respectively, of the Company's total sales. The breakdown of foreign sales by geographic region is as follows:
	Laser equipment and accessories	$	283,000		$	48,000
	Delivery and disposable devices		477,000			674,000														2013			2012
	Service and rental		639,000			753,000													Asia	$	551,000		$	558,000
	Total	$	1,399,000		$	1,475,000													Europe		304,000			238,000
																			Latin America		245,000			467,000
	Gross profit (loss)																		Middle East		3,000			–
	Laser equipment and accessories	$	56,000		$	(12,000	)												Australia		31,000			104,000
	Delivery and disposable devices		177,000			300,000													Other		2,000			4,000
	Service and rental		143,000			249,000														$	1,136,000		$	1,371,000
	Total	$	376,000		$	537,000
																			Sales and gross profit to customers by similar products and services for the fiscal years ended September 30, 2013 and 2012 were as follows:
	Sales in foreign countries for the three months ended December 31, 2013 and 2012 accounted for approximately 13.7% and 9.3%, respectively, of the Company's total sales. The breakdown by geographic region is as follows:
																				2013			2012
		Three Months Ended																	By similar products and services:
		December 31,
		2013			2012														Sales
	Asia	$	167,000		$	63,000													Products:
	Europe		5,000			27,000													Lasers and accessories	$	504,000		$	781,000
	Latin America		10,000			47,000													Fibers, Needles and SwitchTips		2,626,000			2,807,000
	Australia		9,000			–													Service and rental		2,859,000			2,492,000
		$	191,000		$	137,000													Total	$	5,989,000		$	6,080,000
																			Gross profit (loss)
	During the three months ended December 31, 2013 and 2012, one Laser was located in Canada and three Lasers, one located in Brazil, Canada and India, respectively.																		Products:
																			Lasers and accessories	$	79,000		$	(11,000	)
	Total segment assets at December 31, 2013 and 2012 for the Products segment were $2,992,000 and $2,560,000, respectively, and for the Service and Rental segment were $1,665,000 and $1,729,000, respectively. The $432,000 difference between total segment assets for the product segment for the current year quarter as compared to the prior year quarter was primarily the result of a $440,000 in cash received during the last quarter of the prior year offset by a reduction in inventory from the prior year. Total segment assets differ from total assets on a consolidated basis as a result of unallocated corporate assets primarily comprised of immaterial amounts of property and equipment, etc.																		Fibers, Needles and Switch Tips		1,330,000			1,132,000
																			Service and rental		959,000			876,000
																			Total	$	2,368,000		$	1,997,000
																			The Company had one laser located in Canada at September 30, 2013. Total segment assets for the Products segment were $3,001,000 and Service and Rental were $1,679,000 at September 30, 2013. Total segment assets differ from total assets on a consolidated basis as a result of unallocated corporate assets primarily comprised of immaterial amounts of property and equipment, etc. During the year ended September 30, 2013, additions of property and equipment to the Service and Rental segment were $52,000.

Recovered_Sheet1

1. Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Dec. 31, 2013
Accounting Policies [Abstract]	'
Principles of Consolidation	'
	Principles of Consolidation
	The accompanying condensed consolidated financial statements include the accounts of Trimedyne, Inc., a Nevada corporation, its wholly owned subsidiary, Mobile Surgical Technologies, Inc. ("MST"), a Texas corporation, and its 90% owned inactive subsidiary, Cardiodyne, Inc. ("Cardiodyne"), a Nevada corporation, (collectively, the "Company"). All intercompany accounts and transactions have been eliminated in consolidation.
	At December 31, 2013, we had working capital of $2,435,000 compared to $2,711,000 at the end of the previous fiscal year ended September 30, 2013. Cash increased by $27,000 to $1,599,000 at December 31, 2013 from $1,572,000 at the fiscal year ended September 30, 2013.
Management's plans	'
	Management's Plans
	The Company is currently pursuing market development efforts in Asia, Latin America and Eastern Europe. We believe that by expanding healthcare infrastructure in these markets we may be able to create a sustained demand for Holmium Lasers applied to Spinal Endoscopy and Laser Lithotripsy. Additionally, we expect the global trend toward single-use disposable laser delivery products will improve sales and profit margins as more hospitals convert from multi-use products, due to concerns for sterility and interests to reduce handling costs incurred in product sterilization, and we are developing more single-use products.
Unaudited Interim Financial Information	'
	Unaudited Interim Financial Information
	The accompanying unaudited condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America for interim financial information, and pursuant to the instructions to Form 10-Q promulgated by the Securities and Exchange Commission ("SEC"). Accordingly, they do not include all information and disclosures required by generally accepted accounting principles for complete financial statement presentation. In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the Company's consolidated financial position as of December 31, 2013 and the results of its operations and its cash flows for the three months ended December 31, 2013 and 2012. Results for the three months ended December 31, 2013 are not necessarily indicative of the results to be expected for the year ending September 30, 2014.
Stock-Based Compensation	'
	Stock-Based Compensation
	Stock-based compensation was $1,000 and $3,000 during the quarters ended December 31, 2013 and 2012, respectively. As of December 31, 2013, there was approximately $4,970 of total unrecognized compensation cost, net of estimated expected forfeitures, related to employee and director stock option compensation arrangements. This unrecognized cost is expected to be recognized on a straight-line basis over the next nine reporting periods.
Use of Estimates	'
	Use of Estimates
	The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates and assumptions include inventory valuation, allowances for doubtful accounts and deferred income tax assets, recoverability of goodwill and long-lived assets and certain accrued liabilities.
	While management believes that the disclosures presented are adequate to make the information not misleading, it is suggested that these condensed consolidated financial statements be read in conjunction with the condensed consolidated financial statements and the notes included in the Company's 2013 annual report on Form 10-K for the year ended September 30, 2013.
Per Share Information	'
	Per Share Information
	Basic per share information is computed based upon the weighted average number of common shares outstanding during the period. Diluted per share information consists of the weighted average number of common shares outstanding, plus the dilutive effects of options and warrants calculated using the treasury stock method. In loss periods, dilutive common equivalent shares are excluded as the effect would be anti-dilutive. During the three months ended December 31, 2013 and 2012, outstanding options of 818,900 and 997,650, respectively, were excluded from the diluted net loss per share as the effects would have been anti-dilutive. In addition, the exercise prices of these options were in excess of the average closing price of the Company’s common stock for the years ended December 31, 2013 and 2012.

Recovered_Sheet2

2. Composition of Certain Balance Sheet Captions (Tables)	3 Months Ended
	Dec. 31, 2013
Composition Of Certain Balance Sheet Captions Tables	'
Inventories	'
		December 31,			September 30,
		2013			2013
	Raw materials	$	442,000		$	501,000
	Work-in-process		86,000			94,000
	Finished goods		512,000			606,000
		$	1,040,000		$	1,201,000
Other current assets	'
		December 31,			September 30,
		2013			2013
	Royalty receivable	$	30,000		$	25,000
	Prepaid insurance		52,000			68,000
	Prepaid income tax		5,000			6,000
	Prepaid rent		13,000			13,000
	Short-term deposits		8,000			8,000
	Other		37,000			46,000
	Total other current assets	$	145,000		$	166,000
Property and equipment	'
		December 31,			September 30,
		2013			2013
	Furniture and equipment	$	3,559,000		$	3,434,000
	Leasehold improvements		57,000			45,000
	Other		316,000			317,000
			3,932,000			3,796,000
	Less accumulated depreciation and amortization		(3,147,000	)		(3,090,000	)
	Total property and equipment	$	785,000		$	706,000
Accrued expenses	'
		December 31,			September 30,
		2013			2013
	Accrued vacation	$	160,000		$	146,000
	Accrued salaries and wages		104,000			51,000
	Accrued compensation		–			55,000
	Accrued bonus		4,000			30,000
	Medical device tax		53,000			39,000
	Sales and use tax		52,000			52,000
	Customer deposits		2,000			2,000
	Commissions		45,000			23,000
	Other		34,000			18,000
	Total accrued expenses	$	454,000		$	416,000

3_Notes_Payable_and_Leases_Tab

3. Notes Payable and Leases (Tables)	3 Months Ended
	Dec. 31, 2013
Debt Disclosure [Abstract]	'
Schedule of notes payable	'
		31-Dec-13
	Capital lease agreement in connection with the update of our IT infrastructure bearing an effective interest rate of 8.41% per annum. The lease requires monthly payments of $3,766 through October 2016. and is secured by the leased equipment.	$	110,000
	Finance agreement issued in connection with the purchasing of an insurance policy. The note bears interest at 3.6% per annum and requires monthly payments principal and interest payments of $1,796 through December 2015.		18,000
	Finance agreement issued in connection with the purchasing of insurance policies. The note bears interest at 3.35% per annum and require monthly principal and interest payments of $9,851 through March 2014.		19,000
		$	147,000
	Less: current portion		(74,000	)
		$	73,000

5_Segment_Information_Tables

5. Segment Information (Tables)	3 Months Ended
	Dec. 31, 2013
Segment Reporting [Abstract]	'
Segment Reporting by Operating activities	'
		For the Three Months Ended									For the Three Months Ended
		31-Dec-13									31-Dec-12
		Products			Service and Rental			Total			Products			Service and Rental		Total
	Revenue	$	760,000		$	639,000		$	1,399,000		$	722,000		$	753,000	$	1,475,000
	Cost of sales		527,000			496,000			1,023,000			434,000			504,000		938,000
	Gross profit		233,000			143,000			376,000			288,000			249,000		537,000
	Expenses:
	Selling, general and administrative		391,000			158,000			549,000			407,000			166,000		573,000
	Research and development		124,000			–			124,000			126,000			–		126,000
	Income (loss) from operations	$	(282,000	)	$	(15,000	)		(297,000	)	$	(245,000	)	$	83,000		(162,000	)
	Other:
	Interest expense								(3,000	)							(1,000	)
	Royalty income								30,000								17,000
	Other income								11,000								4,000
	Provision for income tax								–								2,000
	Net loss							$	(259,000	)						$	(144,000	)
Sales and gross profit to customers by similar products and services	'
		For the Three Months Ended
		December 31,
		2013			2012
	By similar products and services:
	Revenues:
	Laser equipment and accessories	$	283,000		$	48,000
	Delivery and disposable devices		477,000			674,000
	Service and rental		639,000			753,000
	Total	$	1,399,000		$	1,475,000
	Gross profit (loss)
	Laser equipment and accessories	$	56,000		$	(12,000	)
	Delivery and disposable devices		177,000			300,000
	Service and rental		143,000			249,000
	Total	$	376,000		$	537,000
Sales breakdown by geographic region	'
		Three Months Ended
		December 31,
		2013			2012
	Asia	$	167,000		$	63,000
	Europe		5,000			27,000
	Latin America		10,000			47,000
	Australia		9,000			–
		$	191,000		$	137,000

1_Summary_of_Significant_Accou1

1. Summary of Significant Accounting Policies (Narrative) (USD $)	3 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Accounting Policies [Abstract]	'	'
Working capital	$2,435,000	'
Stock-based compensation	1,000	3,000
Unrecognized compensation cost	$4,790	'
Outstanding options excluded from the diluted net loss per share	818,900	997,650

2_Composition_Of_Certain_Balan1

2. Composition Of Certain Balance Sheet Captions (Details-Inventories) (USD $)	Dec. 31, 2013	Sep. 30, 2013
Inventories, net of reserves, consist of the following	'	'
Raw materials	$442,000	$501,000
Work-in-process	86,000	94,000
Finished goods	512,000	606,000
Total Inventory	$1,040,000	$1,201,000

2_Composition_Of_Certain_Balan2

2. Composition Of Certain Balance Sheet Captions (Details-Other Current Assets) (USD $)	Dec. 31, 2013	Sep. 30, 2013
Other current assets consist of the following	'	'
Royalty receivable	$30,000	$25,000
Prepaid insurance	52,000	68,000
Prepaid income tax	5,000	6,000
Prepaid rent	13,000	13,000
Short-term deposits	8,000	8,000
Other	37,000	46,000
Total other current assets	$145,000	$166,000

2_Composition_Of_Certain_Balan3

2. Composition Of Certain Balance Sheet Captions (Details-Property and Equipment) (USD $)	Dec. 31, 2013	Sep. 30, 2013
Property, Plant and Equipment [Abstract]	'	'
Furniture and equipment	$3,559,000	$3,434,000
Leasehold improvements	57,000	45,000
Other	316,000	317,000
Property plant and equipment, gross	3,932,000	3,796,000
Less accumulated depreciation and amortization	-3,147,000	-3,090,000
Total property and equipment, net	$785,000	$706,000

2_Composition_Of_Certain_Balan4

2. Composition Of Certain Balance Sheet Captions (Details-Accrued Expenses) (USD $)	Dec. 31, 2013	Sep. 30, 2013
Accrued expenses consist of the following	'	'
Accrued vacation	$160,000	$146,000
Accrued salaries and wages	104,000	51,000
Accrued compensation	0	55,000
Accrued bonus	4,000	30,000
Medical device tax	53,000	39,000
Sales and use tax	52,000	52,000
Customer deposits	2,000	2,000
Commissions	45,000	23,000
Other	34,000	18,000
Total accrued expenses	$454,000	$416,000

3_Notes_Payable_and_Leases_Det

3. Notes Payable and Leases (Details) (USD $)	Dec. 31, 2013	Sep. 30, 2013	Dec. 31, 2013	Dec. 31, 2013	Dec. 31, 2013
			Capital Lease 1	Finance Agreement 1	Finance Agreement 2
Gross Capital Lease and Finance Agreements Issued	$147,000	'	$110,000	$18,000	$19,000
Less:B B current portion	-74,000	-49,000	'	'	'
Total notes payable and capital lease	$73,000	$0	'	'	'
Effective interest rate	'	'	8.41%	3.60%	3.35%
Maturity date	'	'	31-Oct-16	31-Dec-15	31-Mar-14

5_Segment_Information_DetailsI

5. Segment Information (Details-Income Statement) (USD $)	3 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Revenue	$1,399,000	$1,475,000
Cost of sales	1,023,000	938,000
Gross profit	376,000	537,000
Expenses:	'	'
Selling, general and administrative	549,000	573,000
Research and development	124,000	126,000
Income (loss) from operations	-297,000	-162,000
Other:	'	'
Interest expense	-3,000	-1,000
Royalty income	30,000	17,000
Other income	11,000	4,000
Provision for income taxes	0	2,000
Net loss	-259,000	-144,000
Products	'	'
Revenue	760,000	722,000
Cost of sales	527,000	434,000
Gross profit	233,000	288,000
Expenses:	'	'
Selling, general and administrative	391,000	407,000
Research and development	124,000	126,000
Income (loss) from operations	-282,000	-245,000
Service and rental	'	'
Revenue	639,000	753,000
Cost of sales	496,000	504,000
Gross profit	143,000	249,000
Expenses:	'	'
Selling, general and administrative	158,000	166,000
Research and development	0	0
Income (loss) from operations	($15,000)	$83,000

5_Segment_Information_DetailsS

5. Segment Information (Details-Similar Products) (USD $)	3 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Products:	'	'
Total Sales	$1,399,000	$1,475,000
Gross profit	'	'
Total gross profit (loss)	376,000	537,000
Service and rental	'	'
Products:	'	'
Total Sales	639,000	753,000
Gross profit	'	'
Total gross profit (loss)	143,000	249,000
Lasers and accessories	'	'
Products:	'	'
Total Sales	283,000	48,000
Gross profit	'	'
Total gross profit (loss)	56,000	-12,000
Delivery and disposable devices	'	'
Products:	'	'
Total Sales	477,000	674,000
Gross profit	'	'
Total gross profit (loss)	$177,000	$300,000

5_Segment_Information_DetailsS1

5. Segment Information (Details-Sales in Foreign Countries) (USD $)	3 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Total Sales	$191,000	$137,000
AsiaMember	'	'
Total Sales	167,000	63,000
EuropeMember	'	'
Total Sales	5,000	27,000
LatinAmericaMember	'	'
Total Sales	10,000	47,000
AustraliaMember	'	'
Total Sales	$9,000	$0

5_Segment_Information_Narrativ

5. Segment Information (Narrative) (USD $)	3 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Sep. 30, 2013
Total segment assets	$4,679,000	'	$4,701,000
Sales in foreign countries	13.70%	9.30%	'
Products	'	'	'
Total segment assets	2,992,000	'	'
Products	'	'	'
Total segment assets	'	2,560,000	'
Service and rental	'	'	'
Total segment assets	$1,665,000	1,729,000	'