Exhibit 99.1
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FONAR CORPORATION
Fonar MRI news @ aol . com Inventor of MR Scanning
For Immediate Release An ISO 9001 Company
Contact: Daniel Culver 110 Marcus Drive
Director of Communications Melville, N.Y. 11747
Web site: www.fonar.com Tel: (631) 694-2929
Email:invest2008@fonar.com Fax: (631) 390-1709
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FONAR Announces Financial Results for First Quarter of Fiscal 2009
MELVILLE, NEW YORK, November 14, 2008 - FONAR Corporation (NASDAQ-FONR), The
Inventor of MR Scanning(TM), today announced its financial results for the first
quarter of fiscal 2009, which ended September 30, 2008. The net loss for the
first quarter of fiscal 2009 was $450,000 as compared to a net loss for the same
period one year earlier of $209,000. For the first three months of fiscal 2009
the loss per common share (basic and diluted) was $0.09, as compared to $0.04
loss per common share (basic and diluted) for the same period of fiscal 2008.
During the first fiscal quarter of 2009, the loss from operations dropped to
$1.8 million from $4.1 million one year earlier, a decrease of 55%.
Total revenues for the three months ended September 30, 2008 were $6.8 million
as compared to $8.7 million for the same period one year earlier. Service and
repair revenues were $2.6 million in the first fiscal quarter of 2009 as
compared to $2.7 million in the first quarter of fiscal 2008. The decline in
revenues is attributable to the current financial crisis which significantly
impedes the ability of a prospective customer to secure the financing needed to
place an order.
As of September 30, 2008, there were 130 FONAR UPRIGHT(R) Multi-Position(TM) MRI
units installed worldwide. During the first quarter of fiscal 2009, total
product sales were at $1.4 million.
At the end of the first fiscal quarter of fiscal 2009, total current assets were
$20.6 million, total assets were $33.4 million, total current liabilities were
$36.6 million and total long-term liabilities were $1.4 million. Total cash and
cash equivalents, and marketable securities increased 84% from $2.4 million on
June 30, 2008 to $4.4 million on September 30, 2008.
The Company sold its 92.3% interest in a consolidated entity in September 2008.
This significant one-time event, within the reporting period, resulted in a gain
of approximately $1.4 million. The consolidated entity managed an outpatient MRI
center using the UPRIGHT(R) Multi- Position(TM) MRI scanner.
As previously announced, on July 8, 2008, the Company received a notice of non-
compliance from The NASDAQ Stock Market LLC due to the Company's failure to
satisfy NASDAQ's proxy solicitation and annual meeting requirements. In response
to the first notice of non-compliance, the Company requested and subsequently
attended a hearing before a NASDAQ Listing Qualifications Panel (the "Panel"),
at which the Company presented its plan to regain compliance with those
requirements.
Pursuant to the plan presented to the Panel on October 8, 2008, the Company
filed a definitive proxy statement for the annual shareholders meeting, which is
scheduled to be held on November 17, 2008. The Panel has not yet rendered a
determination as a result of the hearing.
On October 9, 2008, the Company received an additional notice of non-compliance
from The NASDAQ based upon the Company's non-compliance with the minimum
stockholders' equity requirement of $2.5 million for continued listing on The
NASDAQ Capital Market, as set forth in NASDAQ Marketplace Rule 4310(c)(3) (the
"Stockholders' Equity Requirement"), at June 30, 2008, which could serve as an
additional basis for delisting of the Company's securities from The NASDAQ
Capital Market. The Company has made a written submission to the Panel
presenting its plan to regain compliance with the Stockholders' Equity
Requirement. While the Company is hopeful that the Panel will grant its request
for continued listing on NASDAQ, there can be no assurance that the Panel will
do so.
Raymond Damadian, M.D., president and chairman of FONAR said, "The medical
device industry has not been exempt from the current financial crisis that has
affected all segments of the American economy. Consequently, we have been
exercising careful control of R&D and selling, general and administrative costs
which have decreased 35% from $6.5 million to $1.4 million. As a result, our
loss from operations has fallen to its lowest level since fiscal 2005 when FONAR
reported an operating profit of $1.7 million. Notwithstanding the present
nationwide financial pressures, FONAR looks forward only with optimism and
enthusiasm as FONAR's patented UPRIGHT(R) weight-bearing MRI technology
ultimately becomes a mandatory new standard of care in spine medicine,
particularly for those facing surgery and as new applications of UPRIGHT(R) MRI,
such as radiation-free monitoring of scoliosis patients and the non-invasive
diagnosis of pelvic floor dysfunction (PFD) and urinary incontinence that
affects 10 million women, continue to emerge with regularity."
Condensed Consolidated Statements of Operations
(Unaudited)
(000's omitted)
For the Three Months Ended September 30,
2008 2007
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Revenues $6,784 $8,669
Net Loss $( 450) $ (209)
Basic & Diluted
Loss Per Common Share $(0.09) $(0.04)
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The Inventor of MR Scanning(TM), Full Range of Motion(TM), True Flow(TM), The
Proof is in the Picture(TM), Dynamic(TM), pMRI(TM), Multi-Position(TM)
Spondylography(TM) and Spondylometry(TM) are trademarks, and UPRIGHT(R) and
STAND-UP(R) are registered trademarks of FONAR Corporation.
Be sure to visit FONAR's Website for product and investor
information: www.fonar.com
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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.
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