Trimedyne (TMED) 10-Q 15 May 14 2014 Q2 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	6 Months Ended
	Mar. 31, 2014	16-May-14
Document And Entity Information	'	'
Entity Registrant Name	'TRIMEDYNE INC	'
Entity Central Index Key	'0000357001	'
Document Type	'10-Q	'
Document Period End Date	31-Mar-14	'
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	'Q2	'
Document Fiscal Year Focus	'2014	'

CONDENSED_CONSOLIDATED_BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)	Mar. 31, 2014	Sep. 30, 2013
Current assets:	'	'
Cash and cash equivalents	$1,374,000	$1,572,000
Trade accounts receivable, net of allowance for doubtful accounts of $11,000 at March 31, 2014 and September 30, 2013, respectively	432,000	475,000
Inventories	1,177,000	1,201,000
Other current assets	102,000	166,000
Total current assets	3,085,000	3,414,000
Property and equipment, net	728,000	706,000
Other	68,000	37,000
Goodwill	544,000	544,000
Total Assets	4,425,000	4,701,000
Current liabilities:	'	'
Accounts payable	128,000	177,000
Accrued expenses	378,000	416,000
Deferred revenue	47,000	37,000
Accrued warranty	20,000	16,000
Income tax payable	11,000	8,000
Current portion of note payable and capital leases	50,000	49,000
Total current liabilities	634,000	703,000
Deferred rent	9,000	11,000
Capital lease	63,000	'
Total liabilities	706,000	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 March 31, 2014 and September 30, 2013, respectively	186,000	186,000
Additional paid-in capital	51,310,000	51,308,000
Accumulated deficit	-47,064,000	-46,794,000
Stockholders' Equity before Treasury Stock	4,432,000	4,700,000
Treasury stock, at cost (101,609 shares)	-713,000	-713,000
Total stockholders' equity	3,719,000	3,987,000
Total liabilities and stockholder's equity	$4,425,000	$4,701,000

CONDENSED_CONSOLIDATED_BALANCE1

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Mar. 31, 2014	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	100,000
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	'

CONSOLIDATED_STATEMENTS_OF_OPE

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	3 Months Ended		6 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Net revenues:	'	'	'	'
Net revenues	$1,382,000	$1,570,000	$2,781,000	$3,045,000
Cost of sales	831,000	919,000	1,854,000	1,857,000
Gross profit	551,000	651,000	927,000	1,188,000
Operating expenses:	'	'	'	'
Selling, general and administrative	472,000	572,000	1,021,000	1,145,000
Research and development	112,000	125,000	236,000	251,000
Total operating expenses	584,000	697,000	1,257,000	1,396,000
Loss from operations	-33,000	-46,000	-330,000	-208,000
Other income, net	25,000	209,000	63,000	229,000
Income (loss) before provision for income taxes	-8,000	163,000	-267,000	21,000
Provision for income taxes	-3,000	-2,000	-3,000	-4,000
Net income (loss)	($11,000)	$161,000	($270,000)	$17,000
Net income (loss) per share - Basic	$0	$0.01	($0.01)	$0
Net income (loss) per share - Diluted	$0	$0.01	($0.01)	$0
Weighted average number of shares outstanding - Basic	18,395,960	18,395,960	18,395,960	18,395,960
Weighted average number of shares outstanding - Diluted	18,395,960	18,395,960	18,395,960	18,395,960

CONSOLIDATED_STATEMENTS_OF_CAS

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	6 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Cash flows from operating activities:	'	'
Net (loss) income	($270,000)	$17,000
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:	'	'
Stock-based compensation	2,000	4,000
Depreciation and amortization	115,000	139,000
Changes in operating assets and liabilities:	'	'
Trade accounts receivable	43,000	-70,000
Inventories	24,000	183,000
Other assets	42,000	44,000
Accounts payable	-49,000	-47,000
Accrued expenses	-38,000	9,000
Income tax payable	3,000	3,000
Deferred revenue	10,000	-2,000
Accrued warranty	4,000	-12,000
Deferred rent	-2,000	-32,000
Net cash provided by (used in) operating activities	-116,000	236,000
Cash flows from investing activities:	'	'
Purchase of property and equipment	-6,000	-56,000
Net cash used in investing activities	-6,000	-56,000
Cash flows from financing activities:	'	'
Principal payments on note payable and capital leases	-76,000	-68,000
Net cash used by financing activities	-76,000	-68,000
Net (decrease) increase in cash and cash equivalents	-198,000	112,000
Cash and cash equivalents at beginning of period	1,572,000	472,000
Cash and cash equivalents at end of period	$1,374,000	$584,000

1_Summary_Of_Significant_Accou

1. Summary Of Significant Accounting Policies	6 Months Ended
	Mar. 31, 2014
Accounting Policies [Abstract]	'
Summary Of Significant Accounting Policies	'
	NOTE 1 - 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.
	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 to reduce 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 March 31, 2014 and the results of their operations and their cash flows for the six months ended March 31, 2014 and 2013. Results for the six months ended March 31, 2014 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, losses for contingencies and certain accrued liabilities, as well as the valuation of equity compensation.
	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.
	Stock-Based Compensation
	Stock-based compensation was $2,000 and $4,000 during the six months ended March 31, 2014 and 2013, respectively. As of March 31, 2014, there was approximately $4,215 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 eight 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 and six months ended March 31, 2014 and 2013, outstanding options of 818,900 and 932,650, 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, with the exception of 110,000 options, were in excess of the average closing price of the Company’s common stock for the periods ended March 31, 2014 and 2013.
	Cash and Cash Equivalents
	The Company considers all highly liquid investments with insignificant interest rate risk and original maturities of three months or less from the date of purchase to be cash equivalents. The carrying amounts of cash and cash equivalents approximate their fair values.
	At March 31, 2014, the Company had cash balances in excess of federally insured limits of $250,000 in the amount of $1,053,000.

2_Composition_Of_Certain_Balan

2. Composition Of Certain Balance Sheet Captions	6 Months Ended
	Mar. 31, 2014
Disclosure Text Block Supplement [Abstract]	'
Composition Of Certain Balance Sheet Captions	'
	NOTE 2 - Composition of Certain Balance Sheet Captions
	Inventories, net of reserves, consist of the following:
		March 31,			September 30,
		2014			2013
	Raw materials	$	499,000		$	501,000
	Work-in-process		196,000			94,000
	Finished goods		482,000			606,000
		$	1,177,000		$	1,201,000
	For the three months ended March 31, 2014 and 2013, 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:
		March 31,			September 30,
		2014			2013
	Royalty receivable	$	29,000		$	25,000
	Prepaid insurance		14,000			68,000
	Prepaid taxes		5,000			6,000
	Prepaid rent		13,000			13,000
	Short-term deposits		8,000			8,000
	Other		33,000			46,000
	Total other current assets	$	102,000		$	166,000
	Property and equipment consist of the following:
		March 31,			September 30,
		2014			2013
	Furniture and equipment	$	3,523,000		$	3,434,000
	Leasehold improvements		57,000			45,000
	Other		316,000			317,000
			3,896,000			3,796,000
	Less accumulated depreciation and amortization		(3,168,000	)		(3,090,000	)
	Total property and equipment	$	728,000		$	706,000
	Accrued expenses consist of the following:
		March 31,			September 30,
		2014			2013
	Accrued vacation	$	168,000		$	146,000
	Accrued salaries and wages		53,000			51,000
	Accrued compensation		–			55,000
	Accrued bonus		7,000			30,000
	Medical device tax		65,000			39,000
	Sales and use tax		51,000			52,000
	Customer deposits		2,000			2,000
	Commissions		17,000			23,000
	Other		15,000			18,000
	Total accrued expenses	$	378,000		$	416,000

3_Note_Payable_and_Capital_Lea

3. Note Payable and Capital Leases	6 Months Ended
	Mar. 31, 2014
Debt Disclosure [Abstract]	'
Notes Payable and Leases	'
	NOTE 3 - Note Payable and Capital Leases
	Note payable and capital leases consist of the following:
		31-Mar-14
	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.	$	101,000
	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.		12,000
		$	113,000
	Less:  current portion		(50,000	)
		$	63,000

4_Commitments_And_Contingencie

4. Commitments And Contingencies	6 Months Ended
	Mar. 31, 2014
Commitments and Contingencies Disclosure [Abstract]	'
Commitments And Contingencies	'
	NOTE 4 - 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. We are not presently involved in any litigation.
	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 and Medicaid Programs, 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	6 Months Ended
	Mar. 31, 2014
Segment Reporting [Abstract]	'
Segment Information	'
	NOTE 5 - 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.
	Data with respect to these operating activities for the three and six months ended March 31, 2014 and 2013 are as follows:
		For the Three Months Ended March 31, 2014								For the Three Months Ended March 31, 2013
		Products			Service and Rental		Total			Products			Service and Rental		Total
	Revenue	$	804,000		$	578,000	$	1,382,000		$	898,000		$	672,000	$	1,570,000
	Cost of sales		449,000			382,000		831,000			475,000			444,000		919,000
	Gross profit		355,000			196,000		551,000			423,000			228,000		651,000
	Expenses:
	Selling, general and administrative		320,000			152,000		472,000			387,000			185,000		572,000
	Research and development		112,000			–		112,000			125,000			–		125,000
	Income (loss) from operations	$	(77,000	)	$	44,000		(33,000	)	$	(89,000	)	$	43,000		(46,000	)
	Other:
	Interest expense							(1,000	)							–
	Royalty income							24,000								34,000
	Other income							2,000								175,000
	Income taxes							(3,000	)							(2,000	)
	Net income (loss)						$	(11,000	)						$	161,000
		For the Six Months Ended March 31, 2014								For the Six Months Ended March 31, 2013
		Products			Service and Rental		Total			Products			Service and Rental		Total
	Revenue	$	1,564,000		$	1,217,000	$	2,781,000		$	1,620,000		$	1,425,000	$	3,045,000
	Cost of sales		976,000			878,000		1,854,000			909,000			948,000		1,857,000
	Gross profit		588,000			339,000		927,000			711,000			477,000		1,188,000
	Expenses:
	Selling, general and administrative		711,000			310,000		1,021,000			794,000			351,000		1,145,000
	Research and development		236,000			–		236,000			251,000			–		251,000
	Income (loss) from operations	$	(359,000	)	$	29,000		(330,000	)	$	(334,000	)	$	126,000		(208,000	)
	Other:
	Interest expense							(4,000	)							(1,000	)
	Royalty income							54,000								51,000
	Other income							13,000								179,000
	Income taxes							(3,000	)							(4,000	)
	Net income (loss)						$	(270,000	)						$	17,000
	Sales and gross profit to customers by similar products and services for the three and six months ended March 31, 2014 and 2013 were as follows:
		For the Three Months Ended March 31,					For the Six Months Ended March 31,
		2014			2013		2014			2013
	By similar products and services:
	Revenues:
	Products:
	Laser equipment and accessories	$	84,000		$	169,000	$	366,000		$	217,000
	Delivery and disposable devices		720,000			729,000		1,198,000			1,403,000
	Service and rental		578,000			672,000		1,217,000			1,425,000
	Total	$	1,382,000		$	1,570,000	$	2,781,000		$	3,045,000
	Gross profit
	Products:
	Laser equipment and accessories	$	(2,000	)	$	55,000	$	52,000		$	43,000
	Delivery and disposable devices		357,000			368,000		536,000			668,000
	Service and rental		196,000			228,000		339,000			477,000
	Total	$	551,000		$	651,000	$	927,000		$	1,188,000
	Sales in foreign countries for the three months ended March 31, 2014 and 2013, accounted for approximately 26% and 26%, respectively, of the Company's total sales. Sales in foreign countries for the six months ended March 31, 2014 and 2013 accounted for approximately 20% and 18%, respectively, of the Company's total sales. The breakdown by geographic region is as follows:
		Three Months			Three Months		Six Months			Six Months
		Ended			Ended		Ended			Ended
		31-Mar-14			31-Mar-13		31-Mar-14			31-Mar-13
	Asia	$	288,000		$	76,000	$	455,000		$	139,000
	Europe		18,000			132,000		23,000			159,000
	Latin America		40,000			170,000		50,000			217,000
	Middle East		1,000			1,000		1,000			1,000
	Australia		14,000			20,000		23,000			20,000
	Other		–			2,000		–			2,000
		$	361,000		$	401,000	$	552,000		$	538,000
	During the three and six months ended March 31, 2014 and 2013, one Laser was located in Canada and three Lasers, one located in Brazil, Canada and India, respectively.
	Total segment assets at March 31, 2014 and 2013 for the Products segment were $2,803,000 and $2,572,000, respectively, and for the Service and Rental segment were $1,600,000 and $1,611,000, respectively. The $231,000 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.

6_SUBSEQUENT_EVENTS

6. SUBSEQUENT EVENTS	6 Months Ended
	Mar. 31, 2014
Subsequent Events [Abstract]	'
SUBSEQUENT EVENTS	'
	NOTE 6 - SUBSEQUENT EVENTS
	On April 1, 2014 the Company entered into a finance agreement to purchase certain insurance policies for $62,000. The note bears interest at 3.35% per annum and requires monthly principal and interest payments of $5,693 through March 2015.

Recovered_Sheet1

1. Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Mar. 31, 2014
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.
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 to reduce 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 March 31, 2014 and the results of their operations and their cash flows for the six months ended March 31, 2014 and 2013. Results for the six months ended March 31, 2014 are not necessarily indicative of the results to be expected for the year ending September 30, 2014.
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, losses for contingencies and certain accrued liabilities, as well as the valuation of equity compensation.
	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.
Stock-Based Compensation	'
	Stock-Based Compensation
	Stock-based compensation was $2,000 and $4,000 during the six months ended March 31, 2014 and 2013, respectively. As of March 31, 2014, there was approximately $4,215 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 eight reporting periods.
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 and six months ended March 31, 2014 and 2013, outstanding options of 818,900 and 932,650, 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, with the exception of 110,000 options, were in excess of the average closing price of the Company’s common stock for the periods ended March 31, 2014 and 2013.
Cash and Cash Equivalents	'
	Cash and Cash Equivalents
	The Company considers all highly liquid investments with insignificant interest rate risk and original maturities of three months or less from the date of purchase to be cash equivalents. The carrying amounts of cash and cash equivalents approximate their fair values.
	At March 31, 2014, the Company had cash balances in excess of federally insured limits of $250,000 in the amount of $1,053,000.

Recovered_Sheet2

2. Composition of Certain Balance Sheet Captions (Tables)	6 Months Ended
	Mar. 31, 2014
Composition Of Certain Balance Sheet Captions Tables	'
Inventories	'
	Inventories, net of reserves, consist of the following:
		March 31,			September 30,
		2014			2013
	Raw materials	$	499,000		$	501,000
	Work-in-process		196,000			94,000
	Finished goods		482,000			606,000
		$	1,177,000		$	1,201,000
Other current assets	'
	Other current assets consist of the following:
		March 31,			September 30,
		2014			2013
	Royalty receivable	$	29,000		$	25,000
	Prepaid insurance		14,000			68,000
	Prepaid taxes		5,000			6,000
	Prepaid rent		13,000			13,000
	Short-term deposits		8,000			8,000
	Other		33,000			46,000
	Total other current assets	$	102,000		$	166,000
Property and equipment	'
	Property and equipment consist of the following:
		March 31,			September 30,
		2014			2013
	Furniture and equipment	$	3,523,000		$	3,434,000
	Leasehold improvements		57,000			45,000
	Other		316,000			317,000
			3,896,000			3,796,000
	Less accumulated depreciation and amortization		(3,168,000	)		(3,090,000	)
	Total property and equipment	$	728,000		$	706,000
Accrued expenses	'
	Accrued expenses consist of the following:
		March 31,			September 30,
		2014			2013
	Accrued vacation	$	168,000		$	146,000
	Accrued salaries and wages		53,000			51,000
	Accrued compensation		–			55,000
	Accrued bonus		7,000			30,000
	Medical device tax		65,000			39,000
	Sales and use tax		51,000			52,000
	Customer deposits		2,000			2,000
	Commissions		17,000			23,000
	Other		15,000			18,000
	Total accrued expenses	$	378,000		$	416,000

3_Note_Payable_and_Capital_Lea1

3. Note Payable and Capital Leases (Tables)	6 Months Ended
	Mar. 31, 2014
Debt Disclosure [Abstract]	'
Schedule of notes payable	'
	Note payable and capital leases consist of the following:
		31-Mar-14
	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.	$	101,000
	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.		12,000
		$	113,000
	Less:  current portion		(50,000	)
		$	63,000

5_Segment_Information_Tables

5. Segment Information (Tables)	6 Months Ended
	Mar. 31, 2014
Segment Reporting [Abstract]	'
Segment Reporting by Operating activities	'
	Data with respect to these operating activities for the three and six months ended March 31, 2014 and 2013 are as follows:
		For the Three Months Ended March 31, 2014								For the Three Months Ended March 31, 2013
		Products			Service and Rental		Total			Products			Service and Rental		Total
	Revenue	$	804,000		$	578,000	$	1,382,000		$	898,000		$	672,000	$	1,570,000
	Cost of sales		449,000			382,000		831,000			475,000			444,000		919,000
	Gross profit		355,000			196,000		551,000			423,000			228,000		651,000
	Expenses:
	Selling, general and administrative		320,000			152,000		472,000			387,000			185,000		572,000
	Research and development		112,000			–		112,000			125,000			–		125,000
	Income (loss) from operations	$	(77,000	)	$	44,000		(33,000	)	$	(89,000	)	$	43,000		(46,000	)
	Other:
	Interest expense							(1,000	)							–
	Royalty income							24,000								34,000
	Other income							2,000								175,000
	Income taxes							(3,000	)							(2,000	)
	Net income (loss)						$	(11,000	)						$	161,000
		For the Six Months Ended March 31, 2014								For the Six Months Ended March 31, 2013
		Products			Service and Rental		Total			Products			Service and Rental		Total
	Revenue	$	1,564,000		$	1,217,000	$	2,781,000		$	1,620,000		$	1,425,000	$	3,045,000
	Cost of sales		976,000			878,000		1,854,000			909,000			948,000		1,857,000
	Gross profit		588,000			339,000		927,000			711,000			477,000		1,188,000
	Expenses:
	Selling, general and administrative		711,000			310,000		1,021,000			794,000			351,000		1,145,000
	Research and development		236,000			–		236,000			251,000			–		251,000
	Income (loss) from operations	$	(359,000	)	$	29,000		(330,000	)	$	(334,000	)	$	126,000		(208,000	)
	Other:
	Interest expense							(4,000	)							(1,000	)
	Royalty income							54,000								51,000
	Other income							13,000								179,000
	Income taxes							(3,000	)							(4,000	)
	Net income (loss)						$	(270,000	)						$	17,000
Sales and gross profit to customers by similar products and services	'
	Sales and gross profit to customers by similar products and services for the three and six months ended March 31, 2014 and 2013 were as follows:
		For the Three Months Ended March 31,					For the Six Months Ended March 31,
		2014			2013		2014			2013
	By similar products and services:
	Revenues:
	Products:
	Laser equipment and accessories	$	84,000		$	169,000	$	366,000		$	217,000
	Delivery and disposable devices		720,000			729,000		1,198,000			1,403,000
	Service and rental		578,000			672,000		1,217,000			1,425,000
	Total	$	1,382,000		$	1,570,000	$	2,781,000		$	3,045,000
	Gross profit
	Products:
	Laser equipment and accessories	$	(2,000	)	$	55,000	$	52,000		$	43,000
	Delivery and disposable devices		357,000			368,000		536,000			668,000
	Service and rental		196,000			228,000		339,000			477,000
	Total	$	551,000		$	651,000	$	927,000		$	1,188,000
Sales breakdown by geographic region	'
	The breakdown by geographic region is as follows:
		Three Months			Three Months		Six Months			Six Months
		Ended			Ended		Ended			Ended
		31-Mar-14			31-Mar-13		31-Mar-14			31-Mar-13
	Asia	$	288,000		$	76,000	$	455,000		$	139,000
	Europe		18,000			132,000		23,000			159,000
	Latin America		40,000			170,000		50,000			217,000
	Middle East		1,000			1,000		1,000			1,000
	Australia		14,000			20,000		23,000			20,000
	Other		–			2,000		–			2,000
		$	361,000		$	401,000	$	552,000		$	538,000

1_Summary_of_Significant_Accou1

1. Summary of Significant Accounting Policies (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Accounting Policies [Abstract]	'	'	'	'
Stock-based compensation	'	'	$2,000	$4,000
Unrecognized compensation cost	4,215	'	4,215	'
Unrecognized compensation cost, period for recognition	'	'	'8 years	'
Outstanding options excluded from the diluted net loss per share	818,900	932,650	818,900	932,650
Cash, FDIC Insured Amount	250,000	'	250,000	'
Amount above federally insured limit	$1,053,000	'	$1,053,000	'

2_Composition_Of_Certain_Balan1

2. Composition Of Certain Balance Sheet Captions (Details-Inventories) (USD $)	Mar. 31, 2014	Sep. 30, 2013
Inventories, net of reserves, consist of the following	'	'
Raw materials	$499,000	$501,000
Work-in-process	196,000	94,000
Finished goods	482,000	606,000
Total Inventory	$1,177,000	$1,201,000

2_Composition_Of_Certain_Balan2

2. Composition Of Certain Balance Sheet Captions (Details-Other Current Assets) (USD $)	Mar. 31, 2014	Sep. 30, 2013
Other current assets consist of the following	'	'
Royalty receivable	$29,000	$25,000
Prepaid insurance	14,000	68,000
Prepaid taxes	5,000	6,000
Prepaid rent	13,000	13,000
Short-term deposits	8,000	8,000
Other	33,000	46,000
Total other current assets	$102,000	$166,000

2_Composition_Of_Certain_Balan3

2. Composition Of Certain Balance Sheet Captions (Details-Property and Equipment) (USD $)	Mar. 31, 2014	Sep. 30, 2013
Property, Plant and Equipment [Abstract]	'	'
Furniture and equipment	$3,523,000	$3,434,000
Leasehold improvements	57,000	45,000
Other	316,000	317,000
Property plant and equipment, gross	3,896,000	3,796,000
Less accumulated depreciation and amortization	-3,168,000	-3,090,000
Total property and equipment	$728,000	$706,000

2_Composition_Of_Certain_Balan4

2. Composition Of Certain Balance Sheet Captions (Details-Accrued Expenses) (USD $)	Mar. 31, 2014	Sep. 30, 2013
Accrued expenses consist of the following	'	'
Accrued vacation	$168,000	$146,000
Accrued salaries and wages	53,000	51,000
Accrued compensation	'	55,000
Accrued bonus	7,000	30,000
Medical device tax	65,000	39,000
Sales and use tax	51,000	52,000
Customer deposits	2,000	2,000
Commissions	17,000	23,000
Other	15,000	18,000
Total accrued expenses	$378,000	$416,000

3_Note_Payable_and_Capital_Lea2

3. Note Payable and Capital Leases (Details) (USD $)	Mar. 31, 2014	Sep. 30, 2013	Mar. 31, 2014	Mar. 31, 2014
			Capital Lease 1	Finance Agreement 1
Gross Capital Lease and Finance Agreements Issued	$113,000	'	$101,000	$12,000
Less: current portion	-50,000	-49,000	'	'
Total notes payable and capital lease	63,000	'	'	'
Monthly payments	'	'	$3,766	$1,796
Effective interest rate	'	'	8.41%	3.60%
Maturity date	'	'	31-Oct-16	31-Dec-15

5_Segment_Information_DetailsO

5. Segment Information (Details-Operating activities) (USD $)	3 Months Ended		6 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Revenue	$1,382,000	$1,570,000	$2,781,000	$3,045,000
Cost of sales	831,000	919,000	1,854,000	1,857,000
Gross profit	551,000	651,000	927,000	1,188,000
Expenses:	'	'	'	'
Selling, general and administrative	472,000	572,000	1,021,000	1,145,000
Research and development	112,000	125,000	236,000	251,000
Income (loss) from operations	-33,000	-46,000	-330,000	-208,000
Other:	'	'	'	'
Interest expense	-1,000	'	-4,000	-1,000
Royalty income	24,000	34,000	54,000	51,000
Other income	2,000	175,000	13,000	179,000
Income taxes	3,000	2,000	3,000	4,000
Net loss	-11,000	161,000	-270,000	17,000
Products	'	'	'	'
Revenue	804,000	898,000	1,564,000	1,620,000
Cost of sales	449,000	475,000	976,000	909,000
Gross profit	355,000	423,000	588,000	711,000
Expenses:	'	'	'	'
Selling, general and administrative	320,000	387,000	711,000	794,000
Research and development	112,000	125,000	236,000	251,000
Income (loss) from operations	-77,000	-89,000	-359,000	-334,000
Service and rental	'	'	'	'
Revenue	578,000	672,000	1,217,000	1,425,000
Cost of sales	382,000	444,000	878,000	948,000
Gross profit	196,000	228,000	339,000	477,000
Expenses:	'	'	'	'
Selling, general and administrative	152,000	185,000	310,000	351,000
Research and development	'	'	'	'
Income (loss) from operations	$44,000	$43,000	$29,000	$126,000

5_Segment_Information_DetailsP

5. Segment Information (Details-Products) (USD $)	3 Months Ended		6 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Products:	'	'	'	'
Total Sales	$1,382,000	$1,570,000	$2,781,000	$3,045,000
Gross profit	'	'	'	'
Total gross profit (loss)	551,000	651,000	927,000	1,188,000
Laser equipment and accessories	'	'	'	'
Products:	'	'	'	'
Total Sales	84,000	169,000	366,000	217,000
Gross profit	'	'	'	'
Total gross profit (loss)	-2,000	55,000	52,000	43,000
Delivery and disposable devices	'	'	'	'
Products:	'	'	'	'
Total Sales	720,000	729,000	1,198,000	1,403,000
Gross profit	'	'	'	'
Total gross profit (loss)	357,000	368,000	536,000	668,000
Service and rental	'	'	'	'
Products:	'	'	'	'
Total Sales	578,000	672,000	1,217,000	1,425,000
Gross profit	'	'	'	'
Total gross profit (loss)	$196,000	$228,000	$339,000	$477,000

5_Segment_Information_DetailsG

5. Segment Information (Details-Geographic breakdown) (USD $)

3 Months Ended

6 Months Ended

3 Months Ended

6 Months Ended

3 Months Ended

6 Months Ended

3 Months Ended

6 Months Ended

3 Months Ended

6 Months Ended

3 Months Ended

6 Months Ended

3 Months Ended

6 Months Ended

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Jun. 30, 2014

Jun. 30, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Mar. 31, 2014

Mar. 31, 2013

Asia [Member]

Asia [Member]

Asia [Member]

Asia [Member]

Europe [Member]

Europe [Member]

Europe [Member]

Europe [Member]

Latin America [Member]

Latin America [Member]

Latin America [Member]

Latin America [Member]

Middle East [Member]

Middle East [Member]

Middle East [Member]

Middle East [Member]

Australia [Member]

Australia [Member]

Australia [Member]

Australia [Member]

Other Countries [Member]

Other Countries [Member]

Other Countries [Member]

Other Countries [Member]

Total Sales

$361,000

$401,000

$552,000

$538,000

$288,000

$76,000

$455,000

$139,000

$18,000

$132,000

$23,000

$159,000

$40,000

$170,000

$50,000

$217,000

$1,000

$1,000

$1,000

$1,000

$14,000

$20,000

$23,000

$20,000

$0

$2,000

$0

$2,000

5_Segment_Information_Details_

5. Segment Information (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2013	Sep. 30, 2013
Total segment assets	$4,425,000	'	$4,425,000	'	$4,701,000
Sales in foreign countries	26.00%	26.00%	20.00%	18.00%	'
Products	'	'	'	'	'
Total segment assets	2,803,000	'	2,803,000	'	'
Products	'	'	'	'	'
Total segment assets	'	2,572,000	'	2,572,000	'
Service and rental	'	'	'	'	'
Total segment assets	$1,600,000	1,611,000	$1,600,000	1,611,000	'