Exhibit 99
FONAR CORPORATION
Fonar MRI news @ aol.com 110 Marcus Drive The MRI Specialist
For Immediate Release Melville, NY 11742 An ISO 9001 Company
Contact: Jordan Darrow Contact: Daniel Culver
Darrow Associates, Inc Director of Communications
darrow @ optonline. net Email: invest @ fonar. com
Tel: 631 / 367 - 1866 Tel: 631 / 694 - 2929
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FONAR ANNOUNCES FISCAL 2006 FIRST QUARTER FINANCIAL RESULTS
MELVILLE, NEW YORK, November 9, 2005 -- FONAR Corporation (NASDAQ: FONR), The
MRI Specialist(TM), today announced financial results for the first quarter of
fiscal 2006, which ended September 30, 2005.
Revenues for the first quarter of fiscal 2006 were $10.2 million, compared to
$25.1 million in the same period of fiscal 2005. Overall revenues attributable
to product sales were $4.2 million in the first quarter, a decrease from the
$17.7 million in product sales reported in the comparable period of fiscal 2005.
The lower level of revenue is attributable to a slow down in capital equipment
purchases by customers following robust Upright(TM) MRI sales in mid- to late
fiscal 2005.
Service and repair revenues increased by 87% in the fiscal first quarter of 2006
to $1.9 million from $1.0 million in the same quarter of fiscal 2005. This
improvement is the result of increasing warranty expirations among the growing
base of nearly 100 units in the US and overseas and new service contract
agreements for more recent installations of FONAR's Upright(TM) MRI. Revenues
attributable to FONAR's physician and diagnostic services management segment
(HMCA) were $4.0 million, as compared to $5.8 million in the prior year period.
Net loss for the first three months of fiscal 2006 was $(8.3) million, or
$(0.08) loss per share (basic and diluted), as compared to net income of $0.7
million, or $0.01 per share (basic and diluted), for the same period of fiscal
2005. The Company's loss in the current quarter as compared to the prior year
period primarily reflects the lower level of revenue and termination costs
associated with HMCA's sale of its physical therapy and rehabilitation facility
management business.
Commenting on the financial results for the first quarter of fiscal 2006,
Raymond Damadian, M.D., president and chairman of FONAR said, "Following a
strong fiscal 2005 in terms of Upright MRI scanner sales, our product sales
declined in the first quarter of fiscal 2006. FONAR was subject to reduced
spending in the health care industry that affected many companies in the past
several months. However, based on recent market activity, we are encouraged
that sales activity has been picking up among MRI buyers who are increasingly
recognizing the superior imaging qualities and patient-friendly attributes of
FONAR's unique scanners."
"We are committed to executing our growth strategy. Our plans require
concentrated sales and marketing activities in the US and select foreign markets
that demand the best in medical technology. In the coming months, FONAR will
commence for the first time a national direct-to-consumer advertising campaign.
Other recent developments that lend to our marketing efforts and serve as a
validation of our industry leading technology are the exclusive partnership
formed with SONY Electronics and the agreement with group purchasing
organization MAGNET. We intend to forge other distribution agreements to
enhance our reach into the medical community. In addition, we intend to
continue to present at trade shows to promote the benefits of the Upright MRI
system. These initiatives should create awareness and stimulate demand for our
products, which are markedly differentiated from anything else available in the
MRI market today."
FONAR invites the public to participate in a conference call and Web cast to
discuss the Company's fiscal 2006 first quarter financial results and listen to
an interview of a respected spine surgeon describing the surgical benefits he
has experienced by using FONAR's Upright(TM) MRI. The simultaneous broadcasts
will be held today, November 9, 2005, at 11:00 AM Eastern time.
The events will be broadcast live on the Internet via the Investor Relations
section of the Company's web site at www.fonar.com. Participants should access
the web cast about 10 minutes prior to the start time. For those unable to
attend the live results broadcast, a replay will be available beginning
approximately one hour after the event. Replay information will be posted on the
FONAR web site following the conclusion of the live broadcast. There is no
charge for participants to access the live broadcast or replay.
About FONAR:
FONAR was incorporated in 1978, making it the first, oldest and most experienced
MRI manufacturer in the industry. FONAR introduced the world's first commercial
MRI in 1980, and went public in 1981. Since its inception, the Company has
installed over 300 MRI scanners worldwide. FONAR's stellar product line
includes the Upright(TM) MRI (also known as the Stand-Up(TM) MRI), the only
whole-body MRI that performs Position(TM) imaging (pMRI(TM)) and scans patients
in numerous weight-bearing positions, i.e. standing, sitting, in flexion and
extension, as well as the conventional lie-down position. The FONAR Upright(TM)
MRI often sees the patient's problem that other scanners cannot because they are
lie-down only. With over 100,000 patients scanned, the patient-friendly
Upright(TM) MRI has a near zero claustrophobic rejection rate by patients. As a
FONAR customer states, "If the patient is claustrophobic in this scanner,
they'll be claustrophobic in my parking lot." Approximately 85% of patients are
scanned sitting while they watch a 42" flat screen TV. The Company's latest MRI
scanner is the FONAR 360(TM), a room-size recumbent scanner that optimizes
openness while facilitating physician access to the patient. FONAR is
headquartered on Long Island, New York, and has approximately 500 employees.
Additional information may be found on the FONAR Web site at www.fonar.com.
MRI Specialist, The Inventor of MR Scanning, Stand-Up, Upright, Position, PMRI
and The Proof is in the Picture are trademarks of FONAR.
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This release may include forward-looking statements from the company that may or
may not materialize. Additional information on factors that could potentially
affect the company's financial results may be found in the company filings with
the Securities and Exchange Commission.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended
September 30,
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2005 2004
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Revenues $ 10,153,000 $ 25,068,000
Net (Loss) Income $(8,317,000) $ 728,000
Basic & Diluted (Loss)
Earnings per Common Share $(0.08) $0.01