Milestone Scientific Provides Business Update and Reports Financial Results for the Second Quarter of 2024

Secured Medicare price assignment for the
CompuFlo® Epidural System in multiple U.S. states

Gross margin for the second quarter of 2024 increased to 76.1% from 65.0%
for the same period last year driven by an increase in U.S. e-commerce sales

ROSELAND, N.J., Aug. 15, 2024 (GLOBE NEWSWIRE) — Milestone Scientific Inc. (NYSE: MLSS), a leading developer of computerized drug delivery instruments that provide painless and precise injections, today provides a business update and reported financial results for the second quarter ended June 30, 2024.

Arjan Haverhals, CEO and President of Milestone Scientific, commented, “We are successfully advancing our reimbursement strategy for the CompuFlo® Epidural System, aimed at achieving nationwide coverage. Last month, we reached a significant milestone as we were granted a Medicare Part B Physician payment rate for the CompuFlo® Epidural System under the American Medical Association’s (AMA) technology-specific Category III CPT® code CPT0777T (real-time pressure-sensing epidural guidance system when used in conjunction with a primary ESI procedure). This favorable Medicare pricing for our CompuFlo® Epidural System was granted for multiple Jurisdictional Medicare Administrative Contractors (JMAC) regions, which include states such as Florida, Texas, Pennsylvania, New Jersey, Maryland, Colorado, Oklahoma, Louisiana, Arkansas, Mississippi, New Mexico, District of Columbia, and Delaware. We view this achievement as a transformative event for the Company as we advance our efforts to establish CompuFlo® technology as the standard of care for epidural procedures nationwide.”

“Immediately following the Medicare price assignment, we announced a strategic partnership with Axial Biologics to accelerate the adoption of our CompuFlo® Epidural System. This collaboration significantly extends our reach within the pain management market, leveraging Axial’s established relationships with clinicians in key states such as New Jersey, Texas, and Florida.”

Haverhals continued, “Within our dental division, U.S. e-commerce sales increased to $1.3 million in Q2 2024, compared to $1.2 million for the same period last year, as a result of our strategic decision to end the agreement with our previous distributor and instead channel sales through our online portal. This shift has enabled us to foster a closer, more direct relationship with our customers, as well as improve our margins. Specifically, gross margins increased to 76.1% in Q2 2024 from 65.0% in the same quarter last year. We expect domestic sales will steadily increase as we continue to promote our new e-commerce platform by reaching out directly to customers and patients through our renewed marketing campaigns. On the international front, we faced some temporary challenges related to the distributor’s freight forwarders, which have since been resolved. Additionally, our decision to pause sales in China impacted year-over-year comparisons. Nevertheless, we currently believe that international sales in the second half of this year will show improvement over both the second half of last year and first half of this year. We remain optimistic about the future and believe we have established a scalable, high-margin dental business that will continue to generate positive cash flow.”

“In addition to our improved gross margins, we have taken steps to further streamline operations across the organization. Most notably, we reduced selling, general, and administrative expenses by over $1.1 million compared to the same period last year, further aligning us with our goal of achieving positive cash flow company-wide. With approximately $5.8 million in cash and cash equivalents at the end of the quarter, we are confident that we have sufficient capital to support our growth within both the dental and medical divisions.”

For the three months ended June 30, 2024, and 2023, revenues were approximately $1.9 million and $2.9 million, respectively. As of January 3, 2023, the Company launched an e-commerce platform, selling and shipping the STA Single Tooth Anesthesia System® (STA) and handpieces directly to end users, including dental offices and dental groups. The U.S. e-commerce revenue for the three months ended June 30, 2024, was approximately $1.3 million compared to $1.2 million for the three months ended June 30, 2023. The Company recorded no revenue from other U.S. distributors for the three months ended June 30, 2024 compared to approximately $214,000 for the three months ended June 30, 2023. The Company terminated all non-exclusive agreements with other distributors in the U.S. in September 2023. For the three months ended June 30, 2024, international revenue was approximately $490,000 a decrease of $710,000, compared to June 30, 2023. International sales decreased due to issues with freight forwarder carrier during the quarter. The Company recorded no revenue from China for the three months ended June 30, 2024 compared to approximately $270,000 for the three months ended June 30, 2023.Gross profit for the second quarter ended June 30, 2024, was $1.4 million, or 76% of revenue, versus $1.9 million, or 65% of revenue, for the second quarter ended June 30, 2023. The decrease in gross profit was due to higher margins in sales associated with the launch of the e-commerce platform offset by a decrease in international sales. Operating loss for the three months ended June 30, 2024, was approximately $(1.8) million versus approximately $(2.3) million for the second quarter ended June 30, 2023. Net income was approximately $0.2 million, or $0.00 per share for the three months ended June 30, 2024, versus net loss of $(1.3) million, or $(0.02) per share, for the comparable period in 2023. Net income for the three months ended June 30, 2024, included approximately $2.0 million, net of expenses, from the sale of New Jersey net operating losses (“NOL”).

For the six months ended June 30, 2024, and 2023, revenue was approximately $4.1 million and $5.5 million, respectively. The U.S. e-commerce and dental service revenue for the six months ended June 30, 2024 was approximately $2.7 million compared to $2.2 million at June 30, 2023. The Company terminated its remaining U.S. distributor in September 2023. The Company recorded no revenue from other U.S. distributors for the six months ended June 30, 2024 compared to approximately $432,000 for the six months ended June 30, 2023. For the six months ended June 30, 2024, international revenue was approximately $1.4 million, a decrease of $1.0 million, compared to June 30, 2023. International sales decreased due to issues with freight forwarders carrier during the quarter. The Company recorded no revenue from China for the six months ended June 30, 2024 compared to approximately $270,000 for the six months ended June 30, 2023. Gross profit for the first six months of 2024 was $3.1 million, or 75% of revenue, versus $3.8 million, or 69% of revenue, for the first six months of 2023. Operating loss for the first six months of 2024 was approximately $(3.2) million versus approximately $(3.6) million for the first six months of 2023. Net loss for the first six months of 2024 was $(1.2) million, or $(0.02) per share, versus net loss of $(3.5) million, or $(0.05) per share per share for the comparable period in 2023.

As of June 30, 2024, the Company had cash and cash equivalents of approximately $5.8 million and working capital of approximately $7.7 million.

Conference Call

Milestone Scientific’s executive management team will host a conference call on Thursday, August 15, 2024 at 8:30 AM Eastern Time to discuss the Company’s financial results for the second quarter ended June 30, 2024, as well as the Company’s corporate progress and other developments.

The conference call will be available via telephone by dialing toll free 888-506-0062 for U.S. callers or +1 973-528-0011 for international callers and by entering the access code: 959238. A webcast and replay of the call may be accessed at Webcast URL: https://www.webcaster4.com/Webcast/Page/2306/51045.

An audio replay of the call will be available through Thursday, August 29, 2024, and can be accessed by dialing 877-481-4010 for U.S. callers or +1 919-882-2331 for international callers and by entering the access code: 51045.

About Milestone Scientific Inc.
Milestone Scientific Inc. (MLSS), a technology focused medical research and development company that patents, designs and develops innovative injection technologies and instruments for medical and dental applications. Milestone Scientific’s computer-controlled systems are designed to make injections precise, efficient and increase the overall patient comfort and safety. Their proprietary DPS Dynamic Pressure Sensing Technology® instruments is the platform to advance the development of next-generation devices, regulating flow rate and monitoring pressure from the tip of the needle, through platform extensions of subcutaneous drug delivery, including local anesthetic. To learn more, view the MLSS brand video or visit milestonescientific.com.

Safe Harbor Statement

This press release contains forward-looking statements regarding the timing and financial impact of Milestone’s ability to implement its business plan, expected revenues, timing of regulatory approvals and future success. These statements involve a number of risks and uncertainties and are based on assumptions involving judgments with respect to future economic, competitive and market conditions, future business decisions and regulatory developments, all of which are difficult or impossible to predict accurately and many of which are beyond Milestone’s control. Some of the important factors that could cause actual results to differ materially from those indicated by the forward-looking statements are general economic conditions, failure to achieve expected revenue growth, changes in our operating expenses, adverse patent rulings, FDA or legal developments, competitive pressures, changes in customer and market requirements and standards, and the risk factors detailed from time to time in Milestone’s periodic filings with the Securities and Exchange Commission, including without limitation, Milestone’s Annual Report for the year ended December 31, 2022. The forward-looking statements in this press release are based upon management’s reasonable belief as of the date hereof. Milestone undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

Contact:
Crescendo Communications, LLC
Email: [email protected]
Tel: 212-671-1020

(tables follow)

   
MILESTONE SCIENTIFIC AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
 
   
  June 30, 2024   December 31, 2023  
ASSETS (Unaudited)         
Current assets:                
Cash and cash equivalents   $ 5,752,106     $ 2,977,713  
Marketable securities           2,976,573  
Accounts receivable, net of allowance for credit losses of $10,000, respectively     386,836       312,664  
Prepaid expenses and other current assets     774,603       517,785  
Inventories     3,329,101       2,638,186  
Advances on contracts     1,250,953       1,371,548  
Total current assets     11,493,599       10,794,469  
Furniture, fixtures and equipment, net     12,989       10,024  
Intangibles, net     162,105       178,636  
Right of use assets finance lease     4,673       8,998  
Right of use assets operating lease     307,724       355,235  
Other assets     24,150       24,150  
Total assets   $ 12,005,240     $ 11,371,512  
                 
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY                
Current liabilities:                
Accounts payable   $ 1,403,137     $ 689,604  
Accounts payable, related party     814,829       410,512  
Accrued expenses and other payables     1,070,276       1,511,717  
Accrued expenses, related party     208,682       137,189  
Accrued Liabilities noncontrolling interest     214,000       214,000  
Current portion of finance lease liabilities     5,683       10,264  
Current portion of operating lease liabilities     109,706       103,427  
Total current liabilities     3,826,313       3,076,713  
Non-current portion of finance lease liabilities           434  
Non-current portion of operating lease liabilities     225,050       281,853  
Total liabilities   $ 4,051,363     $ 3,359,000  
                 
Commitments and contingencies                
                 
Stockholders’ equity                
Common stock, par value $0.001; authorized 100,000,000 shares; 77,227,714 shares issued and 77,194,381 shares outstanding as of June 30, 2024; 75,881,840 shares issued and 75,848,507 shares outstanding as of December 31, 2023;     77,228       75,881  
Additional paid in capital     133,344,565       132,187,656  
Accumulated deficit     (124,556,400 )     (123,339,509 )
Treasury stock, at cost, 33,333 shares     (911,516 )     (911,516 )
Total Milestone Scientific, Inc. stockholders’ equity     7,953,877       8,012,512  
                 
Total liabilities and stockholders’ equity   $ 12,005,240     $ 11,371,512  
                 
MILESTONE SCIENTIFIC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
 
  For the three months ended June 30, 2024
  For the three months ended June 30, 2023   For the six months ended June 30, 2024
  For the six months ended June 30, 2023
                               
Product sales, net   $ 1,853,764     $ 2,909,966     $ 4,102,609     $ 5,507,564  
Cost of products sold     442,560       1,019,907       1,015,302       1,728,882  
Gross profit     1,411,204       1,890,059       3,087,307       3,778,682  
                               
Selling, general and administrative expenses     2,868,182       3,937,281       5,903,458       7,011,012  
Research and development expenses     314,968       213,647       409,179       353,994  
Depreciation and amortization expense     8,477       16,681       20,161       33,902  
Total operating expenses     3,191,627       4,167,609       6,332,798       7,398,908  
                               
Loss from operations     (1,780,423 )     (2,277,550 )     (3,245,491 )     (3,620,226 )
Interest income (expense)     20,966       48,722       45,505       72,067  
Gain on sale of net operating losses     1,983,095             1,983,095        
Loss before provision for income taxes     223,638       (2,228,828 )     (1,216,891 )     (3,548,159 )
                               
                               
Net income (loss)     223,638       (2,228,828 )     (1,216,891 )     (3,548,159 )
Net (loss) attributable to noncontrolling interests   $     $ (12,511 )   $     $ (24,176 )
Net income (loss) attributable to Milestone Scientific Inc.   $ 223,638     $ (2,216,317 )   $ (1,216,891 )   $ (3,523,983 )
                               
Net income (loss) per share applicable to common stockholders—                              
Basic and Diluted     0.00       (0.03 )     (0.02 )     (0.05 )
                               
Weighted average shares outstanding and to be issued—                              
Basic     79,966,833       72,333,656       80,412,397       72,048,223  
Diluted     79,967,086       72,333,656       80,412,397       72,048,223  


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