EXHIBIT 99
FOR IMMEDIATE RELEASE
VALLEY FORGE SCIENTIFIC REPORTS THIRD QUARTER AND
NINE MONTH FISCAL 2003 OPERATING RESULTS
OAKS, PA., AUGUST 12, 2003 -- Valley Forge Scientific Corp. (NASDAQ: VLFG; BSE:
VLF), a leading developer of bipolar electrosurgical systems, today announced
operating results for the fiscal 2003 third quarter and nine months ended June
30, 2003.
Sales for the quarter were $1,081,872 compared to sales of $1,148,278 for
the prior year's third quarter. For the nine months, sales were $3,390,950 as
compared to $3,868,482 for the prior year's nine months.
Cost of sales was 46% of sales for the quarter and 49% of sales for the
first nine months, as compared to 48% for the three and nine months ended June
30, 2002.
Selling, general and administrative expenses increased to $378,932 for the
quarter as compared to $362,176 for the third quarter of last year. In the first
nine months of fiscal 2003, selling, general and administrative expenses
increased slightly to $1,194,982 from $1,154,334 for the nine months ended June
30, 2002. The increases primarily resulted from increased selling and marketing
expenses incurred in connection with implementing the sales and marketing plan
for the Bident(R) Bipolar Tissue Management System.
Research and development expenses more than doubled to $151,513 for the
quarter as compared to $70,842 for the third quarter of last year. For the nine
months of fiscal 2003, research and development expenses were $361,020 as
compared to $242,895 for the first nine months of fiscal 2002. The increase was
primarily related to our reaching the final stages of development of our new
surgical irrigator system in the third quarter.
Net income for the quarter was $37,353, or $0.01 per share, as compared to
$90,669, or $0.01 per share, for the third quarter of fiscal 2002. Net income
for the nine months was $107,085, or $0.01 per share, as compared to $335,776,
or 0.04 per share, for the first nine months of fiscal 2002.
During the quarter, 40,600 shares of common stock were repurchased at cost
of $53,987 pursuant to the company's stock repurchase plan. To date, Valley
Forge has repurchased 154,100 shares of common stock, leaving a balance of
45,900 shares that are available for repurchase under the plan.
" Our sales of neurosurgery products to Codman and Shurtleff, Inc. were at
anticipated levels during the quarter, however, sales of our Bident(R) Bipolar
Tissue Management System were at much lower levels than we had anticipated.
Selling our Bident(R) Bipolar Tissue Management System through a limited number
of large dental distributors, each with their own internal procedures and
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timetables, combined with the scheduling required to train large numbers of
sales representatives, is proving to be a much more time consuming process than
we originally anticipated. We are disappointed with the sales results that we
have seen so far for our dental products and are moving forward to jump start
this process." said Jerry Malis, President and CEO of Valley Forge Scientific
Corp.
"We have recently hired a product manager dedicated to marketing our
Bident(R) Bipolar Tissue Management System and to monitor our relationships with
dental distributors. We will also be expanding our selling and marketing plan
for the Bident(R) Bipolar Tissue Management System, which to date has included
print ads in dental magazines and informational CDROM on the operations of the
Bipolar(R) Tissue Management System. We feel that this two-prong strategy will
yield favorable results towards the end of the calendar year."
Management of Valley Forge Scientific will discuss third quarter financial
results on Tuesday, August 12, 2003 in a conference call scheduled for 10:30
a.m. ET. Those who wish to participate in the conference call may do so by
calling (877) 356-9134 approximately 10 minutes prior to the start time and
providing confirmation code 2186740 to the conference operator. For callers
outside the United States, the number is (706) 643-3775. An audiotape replay
will be available by telephone at (800) 642-1687, confirmation code 2186740,
approximately two hours following the conclusion of the call through Tuesday,
August 26, 2003. International callers can access this replay at (706) 645-9291.
Valley Forge Scientific has established itself as a leading developer and
manufacturer of bipolar electrosurgical systems and related instrumentation.
Based on its DualWave(TM) technology, these systems provide surgeons with the
ability to safely cut and coagulate tissue in the most critical areas of the
brain and spinal cord. Based on technology developed in conjunction with Leonard
I. Malis, MD, Professor and Chairman Emeritus of the Mount Sinai School of
Medicine Department of Neurosurgery, the Malis(R) bipolar electrosurgery systems
are considered to be the gold standard worldwide for use in the central nervous
system. For more information on DualWave(TM) technology, Malis(R) bipolar
electrosurgery systems, or other Valley Forge Scientific products, please visit
our Web site at http://www.vlfg.com.
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Valley Forge Scientific Corp.
FINANCIAL HIGHLIGHTS
For the Three For the Nine
Months Ended Months Ended
- -------------------------------------- ---------- ------------ ------------ ------------
6/30/03 6/30/02 6/30/03 6/30/02
- -------------------------------------- ---------- ------------ ------------ ------------
- -------------------------------------- ---------- ------------ ------------ ------------
Net Sales $1,081,872 $ 1,148,278 $ 3,390,950 $ 3,868,482
- -------------------------------------- ---------- ------------ ------------ ------------
Selling, General and
Administrative Expenses $ 378,932 $ 362,176 $ 1,194,982 $ 1,154,334
- -------------------------------------- ---------- ------------ ------------ ------------
Operating Expenses $ 151,513 $ 70,842 $ 361,020 $ 242,895
- -------------------------------------- ---------- ------------ ------------ ------------
Operating Income $ 43,230 $ 153,378 $ 149,611 $ 564,231
- -------------------------------------- ---------- ------------ ------------ ------------
Provision for Income Taxes $ 12,680 $ 71,058 $ 65,141 $ 241,336
- -------------------------------------- ---------- ------------ ------------ ------------
Net Income $ 37,353 $ 90,669 $ 107,085 $ 335,776
- -------------------------------------- ---------- ------------ ------------ ------------
Earnings
- -------------------------------------- ---------- ------------ ------------ ------------
Basic $ 0.01 $ 0.01 $ 0.01 $ 0.04
- -------------------------------------- ---------- ------------ ------------ ------------
Diluted $ 0.01 $ 0.01 $ 0.01 $ 0.04
- -------------------------------------- ---------- ------------ ------------ ------------
- -------------------------------------- ---------- ------------ ------------ ------------
Common shares outstanding
- -------------------------------------- ---------- ------------ ------------ ------------
Basic 7,938,302 8,067,812 7,976,503 8,067,812
- -------------------------------------- ---------- ------------ ------------ ------------
Diluted 7,963,052 8,186,268 8,000,052 8,166,693
- -------------------------------------- ---------- ------------ ------------ ------------
Forward-Looking Statements
Statements in this press release regarding our expectations for research and
development, new products and alliances, and any other statements in this press
release that refer to Valley Forge Scientific's estimated or anticipated future
results are forward-looking statements. All forward-looking statements in this
press release reflect Valley Forge Scientific's current analysis of existing
trends and information and represent Valley Forge Scientific's judgment only as
of the date of this press release. Actual results may differ from current
expectations based on a number of factors affecting Valley Forge Scientific's
business, including but not limited to competitive, regulatory and market
conditions; the performance of new products and the continued acceptance of
current products; the execution of strategic initiatives and alliances; the
market penetration by third parties who distribute and sell Valley Forge
Scientific's products; Valley Forge Scientific's ability to maintain a
sufficient supply of products; product liability claims; and the uncertainties
associated with intellectual property protection for these products. In
addition, matters generally affecting the domestic and global economy can affect
Valley Forge Scientific's results. Therefore, the reader is cautioned not to
rely on these forward-looking statements. Valley Forge Scientific disclaims any
intent or obligation to update these forward-looking statements.
Additional information concerning these and other risk factors may be found in
previous financial press releases issued by Valley Forge Scientific and Valley
Forge Scientific's public periodic filings with the Securities and Exchange
Commission, including Valley Forge Scientific's Form 10-K for the year end
September 30, 2002.
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