Apyx Medical Corporation【APYX】株式ニュース

Bovie Medical Reports Third Quarter 2015 Results
Total Sales increased 15.3% year-on-year; Gross margin was 41.3%
J-Plasma® sales of $505,000 exceeded total sales for first half 2015
Expanded Medical Advisory Board with world renowned leaders in the fields of cardiovascular and cardiothoracic surgery
Strengthened supply chain and product development efficiencies with purchase of R&D and Manufacturing Contractor in Bulgaria in mid-October
J-Plasma® Operating Metrics

Generators in use increased 82% to 62, up from 34 at end of Q2
79 Scrub Purchase Orders, almost double the 42 for first half 2015
Systems approved by 59 Hospital Value Analysis Committees (VACs), up from 42 at end of Q2; under review by 64 additional VACs
November 04, 2015 04:30 PM Eastern Standard Time
CLEARWATER, Fla.--(BUSINESS WIRE)--Bovie Medical Corporation (NYSEMKT:BVX), a maker of medical devices and supplies and the developer of J-Plasma®, a patented new surgical product, today announced results for the third quarter ended September 30, 2015.

“The third quarter marked an inflection point for Bovie Medical”
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Management Comments

“The third quarter marked an inflection point for Bovie Medical,” said Robert L. Gershon, Chief Executive Officer. “The steady build-up in surgeon adoption of J-Plasma® was reflected in major sequential increases across all of our commercialization metrics, from Scrub Purchase Orders through Generators in Use. This strong momentum resulted in third quarter J-Plasma® sales that exceeded the aggregate sales for the first two quarters of 2015. At the same time, our core business revenues increased in line with our expectation for higher electro-generator sales in the second half of 2015, and continued to provide important infrastructure support for the J-Plasma® roll-out.”

“The leading indicators for J-Plasma® have reached a level that we expect should yield strong sales momentum in the coming periods. With 62 generators in use, we have the scale we need to increase adoption within our current installed base and move forward to broaden adoption within those hospitals where J-Plasma® is VAC-approved, while expanding the universe of surgeons who are using the product. By the end of the third quarter there were 132 surgeons using J-Plasma®, a significant increase from the 76 surgeons who were using the product three months earlier.

“J-Plasma® is increasingly being recognized by top surgeons across a range of specialties for its precision and effectiveness. Last quarter we announced the formation of a Medical Advisory Board to assist us in executing on a multi-specialty J-Plasma® strategy, and we named Dr. Vip Patel, a world renowned urologist and leader in robotic surgery as its first member. In the third quarter, we added two equally impressive members: Dr. Husam H. Balkhy, a pioneer in the field of minimally invasive and robotic cardiac surgery and Dr. Robert J. Cerfolio, an internationally recognized expert in robotic cardiothoracic surgery. Expansion of J-Plasma® target specialties to urology, cardiovascular and cardio thoracic surgery under the guidance of these well-recognized thought leaders should significantly increase the size of J-Plasma®’s addressable market. Additionally, this strategy should accelerate the hospital VAC approval process, which continues to extend our sales cycle.”

Third Quarter 2015 Results

Third quarter sales were $7.8 million, up 15.3% from $6.8 million in the third quarter of 2014 on higher sales of core, OEM, and J-Plasma® products. Gross margin was 41.3%, stable with last year’s third quarter adjusted gross margin of 41.3%. In last year’s third quarter the Company reported gross margin of 28.3%, which included costs related to excess and obsolete inventories and other adjustments.

Operating expenses totaled $5.0 million in the third quarter, compared to $4.3 million in the third quarter of 2014. Approximately 80% of the year-on-year increase in operating expenses represented additional spending on R&D and the commercialization of J-Plasma®; SG&A remained stable both sequentially and year-on-year, as higher sales commissions were offset by administrative cost reductions. The Company’s operating loss was $1.8 million, compared to an operating loss of $2.4 million in the third quarter of 2014.

GAAP net loss attributable to common shareholders for the third quarter was $1.6 million, or $0.06 per diluted share, compared with GAAP net loss attributable to common shareholders of $3.0 million, or $0.17 per diluted share in the third quarter of 2014.

The Company had unrestricted cash and cash and equivalents of $13.2 million at the end of the third quarter, compared to $14.1 million at the end of this year’s second quarter.

Recent Developments

Bovie announced the purchase of its Bulgarian R&D and manufacturing contractor (“Bovie Bulgaria”) for approximately $566,000 in cash. Bovie Bulgaria operates a 16,000 square foot ISO13485 certified and FDA registered manufacturing facility located in the capital city of Sofia, which houses manufacturing, development and assembly operations. The transaction gives Bovie full control over this important part of its product development and supply chain, particularly with respect to R&D for advanced surgical energy technology including key components of its J-Plasma® product line.
Bovie received FDA 510(k) clearance for six new hand piece configurations that expand its J-Plasma® pistol grip portfolio, by expanding the range of instrument lengths and adding a new needle configuration to the standard blade configuration.
The Bovie® Ultimate™ Operating Room Generator was named an “Innovation of the Year” by The Society of Laparoendoscopic Surgeons (SLS) on September 2, 2015.
Bovie signed its first group purchasing organization (GPO) agreement with Amerinet, one of the nation’s largest healthcare GPOs, for the use of J-Plasma® by its members. Amerinet has more than 85,000 members, including 33,000 clinics, 3,500 acute care hospitals, and 3,300 ambulatory surgery centers.
Jay Ewers was named Chief Financial Officer. Mr. Ewers has served as interim CFO since mid-June of this year and was previously the Company’s Corporate Controller.
The Medical Advisory Board

In the second quarter of 2015, Bovie established a Medical Advisory Board that will consist of surgeons who are thought-leaders in a range of different specialties and named Dr. Vipul Patel, a world renowned urologist and leader in robotic surgery, as its first member. Ultimately, the Board is expected to have 6 to 9 members and lead the usage of J-Plasma® for specific procedures within new target specialties including, but not limited to, cardiovascular, cardiothoracic and urology.

In the third quarter, the Board was increased to 3 members with the addition of two world-class surgeons:

Dr. Husam H. Balkhy, is Director of Robotic and Minimally Invasive and Cardiac Surgery, and Associate Professor of Surgery at The University of Chicago Medicine. Recognized as a pioneer in the field, he specializes in cardiac diseases, using robotic and less invasive techniques to reduce pain, disability, and recovery time.
Dr. Robert J. Cerfolio is an internationally recognized expert in robotic thoracic surgery. He received the James H. Estes Family Lung Cancer Research Endowed Chair in 2010, and Dr. Cerfolio is currently Professor of Surgery and Section Chief of Thoracic Surgery in the Division of Cardiothoracic Surgery, at the University of Alabama Hospital in Birmingham.
“We are honored that Drs. Balkhy and Cerfolio have agreed to join our Medical Advisory Board and assist us in bringing the significant surgical advantages of J-Plasma® to the appropriate procedures within their areas of expertise,” Mr. Gershon noted.

“Accuracy and safety is paramount for all surgeons,” said Dr. Balkhy. “In cardiac surgery, J-Plasma® has the potential not only to improve accuracy and safety but will allow surgeons to operate with even more precision. J-Plasma® promises to be a very strong addition to the armamentarium of the heart surgeon.”

“J-Plasma® is potentially a revolutionary instrument and represents a paradigm shift in thoracic surgery,” said Dr. Cerfolio. “J-Plasma®'s combination of power and the ability to penetrate tissue less deeply means it could play a pivotal role in teaching younger surgeons and residents, and it may soon be a must-have in the armamentarium of any thoracic surgeon.”

Summary and Outlook:

“Our third quarter results represented significant progress in J-Plasma® sales, substantial momentum in those metrics that provide a roadmap for future J-Plasma® sales, and continued growth in our core business. This performance has laid the foundation for further positive revenue comparisons in both J-Plasma® and our core business this year, as we develop the pipeline that we have built over the last twelve months.

“Within this framework we remain diligent in managing our administrative and other non-revenue generating costs as well as our cash position, while investing in those areas that have the potential to drive future growth. We expect to achieve additional operating expense savings in 2016 and 2017 related to the purchase of our R&D and manufacturing contractor, Bovie Bulgaria, which we announced in mid-October.

“Looking to 2016, we expect our revenue performance to benefit from further sequential increases in J-Plasma® operating metrics in our initial target specialties and a continuation of steady progress in our core business. Additionally, we are working closely with the members of our Medical Advisory Board to identify and appropriately target those procedures for which J-Plasma® can become the standard of care within the high profile urology, cardiovascular and cardio thoracic surgical specialties, as well as further advancing its visibility within our immediate target specialty of gynecology. Importantly, we have a transformational product with an excellent track record, the right surgeon advocates, a direct sales force with multi-specialty experience, and the resources to capture a greater share of an expanded market,” Mr. Gershon concluded.

Conference Call Details

The Company’s management will host a conference call on Thursday, November 5, 2015 at 8:30am Eastern Time to discuss latest corporate developments. Following management’s formal remarks, there will be a question and answer session.

To listen to the call by phone, interested parties within the U.S. should call 1-888-349-0106. International callers should call 1-412-902-0131. All parties should ask for the Bovie Medical Corporation call. The conference call will also be available through a live webcast at Bovie Medical Corporation’s website or at http://services.choruscall.com/links/bvx151105

A replay of the call will be available approximately one hour after the end of the call through February 5, 2016. The replay can be accessed via Bovie Medical Corporation’s website or by dialing 1-877-344-7529 for U.S. callers or 1-412-317-0088 for International callers and using the replay access code 10075038.

About Bovie Medical Corporation

Bovie Medical Corporation is a leading maker of medical devices and supplies as well as the developer of J-Plasma®, a patented new plasma-based surgical product for cutting and coagulation. J-Plasma® utilizes a helium ionization process to produce a stable, focused beam of ionized gas that provides surgeons with greater precision, minimal invasiveness and an absence of conductive currents through the patient during surgery. Bovie Medical Corporation is also a leader in the manufacture of a range of electrosurgical products and technologies, marketed through both private labels and the Company’s own well-respected brands (Bovie®, Aaron®, IDS™ and ICON™) to distributors worldwide. The Company also leverages its expertise through original equipment manufacturing (OEM) agreements with other medical device manufacturers. For further information about the Company’s current and new products, please refer to the Investor Relations section of Bovie Medical Corporation’s website www.boviemed.com

Cautionary Statement on Forward-Looking Statements

Certain matters discussed in this release and oral statements made from time to time by representatives of the Company may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the Federal securities laws. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved.

Forward-looking information is subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected. Many of these factors are beyond the Company’s ability to control or predict. Important factors that may cause actual results to differ materially and that could impact the Company and the statements contained in this release can be found in the Company’s filings with the Securities and Exchange Commission including the Company’s Report on Forms 10-K and 10-Q for the year ended December 31, 2014 and the quarters ended March 31, 2015 and June 30, 2015, respectively. For forward-looking statements in this release, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company assumes no obligation to update or supplement any forward-looking statements whether as a result of new information, future events or otherwise.

BOVIE MEDICAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2015 AND 2014
(unaudited) (in thousands except per share data)

Three Months Ended Nine Months Ended
September 30, September 30,
2015 2014 2015 2014

Sales $ 7,823 $ 6,788 $ 21,226 $ 20,214
Cost of sales 4,594 4,869 12,183 13,662

Gross profit 3,229 1,919 9,043 6,552

Other costs and expenses:
Research and development 583 368 1,534 1,019
Professional services 427 142 1,070 686
Salaries and related costs 1,929 1,653 5,749 3,980
Selling, general and administrative 2,103 2,123 6,325 4,923

Total other costs and expenses 5,042 4,286 14,678 10,608

Loss from operations (1,813 ) (2,367 ) (5,635 ) (4,056 )

Interest expense, net (40 ) (41 ) (120 ) (111 )
Change in fair value of liabilities, net 266 (1,676 ) 1,800 (9,820 )
Total other income (expense), net 226 (1,717 ) 1,680 (9,931 )

Loss before income taxes (1,587 ) (4,084 ) (3,955 ) (13,987 )

Provision for (recovery of) income taxes, net -- 1,350 (8 ) 1,895

Net loss $ (1,587 ) $ (2,734 ) $ (3,963 ) $ (12,092 )

Accretion on convertible preferred stock -- (242 ) (222 ) (668 )
Gain on conversion of warrants and preferred shares, net -- -- 13,956 --
Net income (loss) attributable to common shareholders $ (1,587 ) $ (2,976 ) $ 9,771 $ (12,760 )

Income (loss) per share
Basic (0.06 ) (0.17 ) 0.42 (0.72 )
Diluted (0.06 ) (0.17 ) 0.31 (0.72 )
Weighted average number of shares outstanding- basic 27,051 17,780 23,414 17,727
Weighted average number of shares outstanding - dilutive 27,051 17,780 26,346 17,727

Bovie Medical Corporation
Consolidated Balance Sheets
(in thousands)
September 30, December 31,
2015 2014
(Unaudited)
Current assets:

Cash and cash equivalents $ 13,202 $ 5,733
Restricted cash 839 899
Trade accounts receivable, net 2,524 1,992
Inventories, net 6,130 5,727
Current portion of deposits 172 210
Prepaid expenses and other current assets 826 804

Total current assets 23,693 15,365

Property and equipment, net 6,985 6,947
Brand name and trademark 1,510 1,510
Purchased technology and license rights, net 350 431
Deposits, net of current portion 140 165
Other assets 444 415

Total assets $ 33,122 $ 24,833

Bovie Medical Corporation
Consolidated Balance Sheets
(Continued) (in thousands)

September 30, December 31,
2015 2014
Current liabilities: (unaudited)
Accounts payable $ 2,341 $ 1,553
Accrued payroll 113 197
Accrued vacation 257 181
Current portion of mortgage note payable 239 239
Accrued and other liabilities 1,712 1,596

Total current liabilities 4,662 3,766

Mortgage note payable, net of current portion 2,994 3,173
Deferred rents 20 23
Deferred tax liability 563 564
Derivative liabilities 266 12,613

Total liabilities 8,505 20,139

Series A 6% convertible preferred stock, par value $0.001; 3,500,000
shares authorized, zero issued and outstanding as of September 30, 2015
-- 3,190

Stockholders' equity:

Series B convertible preferred stock, par value $.001; 3,588,139
issued and 1,975,639 outstanding as of September 30, 2015
2 --

Common stock, par value $.001 par value; 40,000,000 shares
authorized; 27,194,251 issued and 27,051,172 outstanding as of
September 30, 2015 and 17,995,409 issued and 17,852,330
outstanding as of December 31, 2014, respectively
27 18
Additional paid-in capital 42,664 29,334
Accumulated deficit (18,076 ) (27,848 )

Total stockholders' equity 24,617 1,504

Total liabilities and stockholders' equity $ 33,122 $ 24,833

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL MEASURES

Three Months Ended Nine Months Ended
September 30, September 30,
(Amounts in '000's except earnings per share) 2015 2014 2015 2014
(unaudited) (unaudited) (unaudited) (unaudited)

Net Income/(loss) GAAP Basis $ (1,587 ) $ (2,734 ) $ (3,963 ) $ (12,092 )
Accretion on convertible preferred stock - (242 ) (222 ) (668 )
Deemed dividend on conversion of warrants and Series A convertible preferred to
Series B convertible preferred stock
- - 13,956 -
Net income/(loss) attributable to common shareholders $ (1,587 ) $ (2,976 ) $ 9,771 $ (12,760 )
Net income/(loss) per share - basic (GAAP basis) $ (0.06 ) $ (0.17 ) $ 0.42 $ (0.72 )

Other non-GAAP adjustments:
(Gain)/loss on change in fair value of derivative liabilities $ (266 ) $ 1,676 $ (1,800 ) $ 9,820
Increase in inventory E&O reserve and other inventory adjustments $ - $ 796 $ - $ 1,639
CFO transition costs $ - $ - $ - $ 340
A/R write off and other administrative charges $ - $ 175 $ - $ 175
Other administrative expenses $ - $ - $ - $ 43
Accretion on convertible preferred shares $ - $ 242 $ 222 $ 668
Tax impact on non-GAAP adjustments $ - $ (378 ) $ - $ (1,663 )
Gain on conversion of warrants and Series A convertible preferred to
Series B convertible preferred stock
- - (13,956 ) -
Adjusted non-GAAP net income/(loss) $ (1,853 ) $ (465 ) $ (5,763 ) $ (1,738 )

Income/(loss) per share - basic on: (Note 1)
(Gain)/loss on change in fair value of derivative liabilities $ (0.01 ) $ 0.09 $ (0.08 ) $ 0.55
Increase in inventory E&O reserve and other inventory adjustments $ - $ 0.04 $ - $ 0.09
CFO transition costs $ - $ - $ - $ 0.02
A/R write off and other administrative charges $ - $ 0.01 $ - $ 0.01
Other administrative expenses $ - $ - $ - $ -
Accretion on convertible preferred shares $ - $ 0.01 $ 0.01 $ 0.04
Tax impact on non-GAAP adjustments $ - $ (0.02 ) $ - $ (0.09 )
Deemed dividend on conversion of warrants and Series A convertible
preferred to Series B convertible preferred stock
- - (0.60 ) -
Adjusted non-GAAP net (loss) per share -basic $ (0.07 ) $ (0.04 ) $ (0.25 ) $ (0.10 )

Weighted average number of shares outstanding - basic 27,051 17,780 23,414 17,727

(Note 1) Amounts reflected in the presentation of EPS calculations may be impacted by rounding

Small steps ...
Minding

==========

From http://finance.yahoo.com/news/bovie-medical-reports-second-quarter-200100874.html

Bovie Medical Reports Second Quarter 2014 Results
Second Quarter 2014 Highlights
Sales increased 15% year-on-year to $6.9 million
Adjusted1 gross margin expanded to 39.2%
Adjusted2 operating loss was $520,000 versus $609,000 in the previous year
J-Plasma® Update
Q2 sales of $15,000; July orders exceeded $50,000
Surgeon pipeline grows to 98, from approximately 50 at end of Q1
Product in use at more than 40 sites
Secured contract with one of the top 10 Integrated Delivery Networks (IDNs) in the country
Business Wire Bovie Medical Corporation
3 minutes ago
CLEARWATER, Fla.--(BUSINESS WIRE)--

Bovie Medical (BVX), a maker of medical devices and supplies and the developer of J-Plasma®, a patented new surgical product, announced results for the second quarter ended June 30, 2014.

Management Comment

“We continued to make significant progress in all aspects of the business during the second quarter,” said Robert L. Gershon, Chief Executive Officer. “We achieved double-digit revenue growth, which drove a 230 basis point increase in adjusted gross margin, demonstrating the potential of our core business and providing important support for the commercialization of our J-Plasma® product.

“Our core business grew 2.8% year-on-year, and we executed on our strategy of adding new products to our portfolio with the announced launch of Derm 101 and 102, for office-based practitioners. These Bovie branded products represent the first new core product launches in several years, and we see multiple opportunities to leverage our significant brand equity to drive further revenue growth.

“The OEM business showed positive comparisons, increasing by a factor of four over last year’s second quarter, which was impacted by contract expirations. This is a scalable business with additional profit potential, and we plan to grow it judiciously so as to optimize our resources to meet projected demand for both our core business products and J-Plasma®.

“We continued to make progress on the commercialization of J-Plasma®. At the end of the second quarter, J-Plasma® was in use at over 40 sites, up from 25 sites at the end of the first quarter, and the number of surgeons using the product increased to more than 60 from 40. Sales in the second quarter reflected timing issues associated with sales cycles for hospital based products as well as the continued build-up and training of our sales team. We succeeded in capturing orders of over $50,000 in July, and importantly, our surgeon pipeline continues to expand, increasing to 98 from approximately 50 at the end of the first quarter, and 12 at the end of 2013.

“In July, we were awarded an important contract with a mid-western Integrated Delivery Network (IDN) that is consistently rated among the top 10 systems by U.S. News & World Report. This is a complex contract that will take some time to fully implement, but it gives us the opportunity to sell J-Plasma® into each of the 13 hospitals that comprise the system,” noted Mr. Gershon.

Second Quarter 2014 Results

Second quarter sales were $6.9 million, a 14.9% increase over the $6.0 million reported in last year’s second quarter. Sales of distributed and branded products were $6.0 million, up 2.8% from the $5.8 million reported for the second quarter of 2013. Sales of OEM products were $961,000, significantly higher than the $223,000 of last year’s second quarter, reflecting higher demand from existing customers. Sales of J-Plasma® were $15,000 for the period.

The Company incurred an inventory write-down of $843,000 in the second quarter primarily related to the commercialization of J-Plasma® and other legacy items in our Core business. As a result, gross profit was $1.9 million compared to $2.2 million in the second quarter of 2013. Adjusted gross margin, which excludes the impact of the write-down, was 39.2%; including the impact, gross margin was 27.0% compared to 36.9% in the prior year. The operating loss in the second quarter was $1.7 million, essentially flat with the second quarter of 2013. The adjusted operating loss, which excludes the previously-mentioned inventory write-down and $383,000 related to CFO transition and other charges, was $520,000 compared to an adjusted operating loss of $609,000 in the prior year which excludes the $1.0 million impact of a legal award.

The Company recorded a non-cash gain of $1.5 million related to the mark-to-market accounting for the fair value of issued common stock purchase warrants. As a result, the Company reported net income for the period of $251,000 with $29,000 attributable to common shareholders. This translated into $0.00 per basic share and a loss of $0.07 per diluted share of common stock compared to a net loss of $1.1 million, or $0.06 per basic and diluted share of common stock in last year’s second quarter. Exclusive of this non-cash gain and other non-GAAP operating charges in 2Q14 and the $1.0 million legal award in 2Q13, the Company would have reported a net loss of $0.03 per basic and diluted share of common stock in line with the loss of $0.03 per basic and diluted share of common stock from a year earlier.

Recent Development

Mr. John C. Andres, JD, was elected to the Bovie Board of Directors at the Annual Meeting held on July 17, 2014. Mr. Andres has over 30 years of experience in the medical device industry, specializing in patent/business strategy development and execution. Most recently, he was a partner of Hawk Healthcare, LLC and previously helped found K2M, Inc. Prior to that, Mr. Andres held various legal and strategic business development positions at the Surgical Division of Tyco Healthcare Group, LLP, now Covidien, Plc and its predecessor, United States Surgical Corporation.
Summary and Outlook

“This was another quarter of solid achievement for Bovie Medical. The commercialization of J-Plasma® is proceeding on schedule, and we continue to take advantage of growth opportunities within our core business. Below is an update on some of our key objectives for 2014:

In line with the Company’s objective to generate strong clinical data and publications, Bovie announced the publication of the first two independent white papers on J-Plasma®, authored by surgeons at a women’s health center in Nevada. The first paper tracks J-Plasma’s® effect on tissue compared to the effects of Argon, monopolar cautery, and CO2 laser, and the second analyzes the versatility of the J-Plasma® product’s power settings. A third white paper, which is scheduled for publication in the third quarter, will examine the pre- and post-procedural results on facial wrinkles, and at least two more white papers are scheduled to be published by the end of 2014. This initiative is expected to greatly assist in the sell-in efforts with Value Analysis Committees at hospital customers.
The Company has scheduled surgeon trainings in Portland, St. Louis, Las Vegas and New York during the third quarter. As more surgeons express interest in J-Plasma®, we will increase our training program schedule to facilitate adoption of the technology.
Bovie’s current sales force is comprised of five direct salespeople, 28 independent manufacturers’ representatives and one clinical specialist to drive adoption of the J-Plasma® device. In August, the Company will conduct a 3-day intensive clinical and product training seminar in Tampa that will include certification and will provide the collateral materials needed to move forward with an efficient and focused sales campaign.
The Derm 101 and 102 products began shipping at the end of July. These efficient and economical high frequency desiccators will allow medical practitioners including family physicians, pediatricians, general dermatologists and nurse practitioners to perform minor skin procedures.
To increase awareness of Bovie Medical and J-Plasma®, the Company has launched a new branding and marketing campaign, which includes new print advertisements and sales materials as well as videos on the Company’s website of actual procedures using J-Plasma®. In addition, Bovie will be redesigning its website.
“We are entering the second half of 2014 with positive momentum. J-Plasma® is gaining recognition by an increasing number of surgeons in our initial targeted markets of gynecology, dermatology and plastic surgery, and we have been able to attract top-notch sales talent to execute its broader roll-out. Thus, we expect to see progressive improvement in the second half of 2014 across the key metrics that relate to the J-Plasma® ramp, with the major positive financial impact to begin in 2015. At the same time, we are developing strategies to leverage our market leadership in electrosurgical products to capture additional profitable revenue growth,” concluded Mr. Gershon.

Use of non-GAAP financial measures

In this press announcement, management has disclosed financial measurements that present financial information not in accordance with Generally Accepted Accounting Principles (GAAP). These measurements are not a substitute for GAAP measurements, although company management uses these measurements as aids in monitoring the company's ongoing financial performance from quarter to quarter and year to year on a regular basis and for benchmarking against other medical technology companies. Adjusted non-GAAP income from operations, adjusted non-GAAP net income and adjusted non-GAAP income per diluted share measure the income from operations, net income and income per diluted share of the company excluding unusual items. Management uses and presents these measures because management believes that such adjustments facilitate an understanding of the financial impact of unusual items on the company's short- and long-term financial trends. Management also uses adjusted non-GAAP items to forecast and to evaluate the operational performance of the company, as well as to compare results of current periods to prior periods on a consistent basis.

Non-GAAP financial measures used by the company may be calculated differently from, and therefore may not be comparable to, similarly-titled measures used by other companies. Investors should consider non-GAAP measures in addition to, and not as a substitute for, or superior to, financial performance measures prepared in accordance with GAAP.

Please refer to the attached reconciliation between GAAP and non-GAAP financial measures.

Conference Call

Bovie Medical will host a conference call on Tuesday, August 5th, at 4:30 pm Eastern Time to discuss first quarter results and latest corporate developments. To listen to the call by phone, interested parties within the U.S. should call 1-877-317-6789. International callers should call 1-412-317-6789. All callers should ask for the Bovie Medical Corporation conference call. The conference call will also be available through a live webcast at Bovie Medical Corporation’s website or at http://services.choruscall.com/links/bvx140805.html. A replay of the call will be available approximately one hour after the end of the call through September 5, 2014. The replay will be available via Bovie Medical Corporation’s website.

About Bovie Medical Corporation

Bovie Medical Corporation is a leading maker of medical devices and supplies as well as the developer of J-Plasma®, a patented new plasma-based surgical product for cutting and coagulation. J-Plasma® utilizes a helium ionization process to produce a stable, focused beam of ionized gas that provides surgeons with greater precision, minimal invasiveness and an absence of conductive currents through the patient during surgery. Bovie Medical Corporation is also a leader in the manufacture of a range of electrosurgical products and technologies, marketed through both private labels and the Company’s own well-respected brands (Bovie®, Aaron®, IDS™ and ICON™) to distributors worldwide. The Company also leverages its expertise through original equipment manufacturing (OEM) agreements with other medical device manufacturers. For further information about the Company’s current and new products, please refer to the Investor Relations section of Bovie Medical Corporation’s website www.boviemed.com.

Cautionary Statement on Forward-Looking Statements

Certain matters discussed in this release and oral statements made from time to time by representatives of the Company may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the Federal securities laws. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved.

Forward-looking information is subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected. Many of these factors are beyond the Company’s ability to control or predict. Important factors that may cause actual results to differ materially and that could impact the Company and the statements contained in this release can be found in the Company’s filings with the Securities and Exchange Commission including the Company’s Reports on Form 10-K/A for the year ended December 31, 2013. For forward-looking statements in this release, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company assumes no obligation to update or supplement any forward-looking statements whether as a result of new information, future events or otherwise.

1 Excluding impact of $843,000 inventory adjustment charge in 2Q14; see page 4 for additional disclosure

2 Excluding $843,000 inventory adjustment charge and $383,000 of expenses related to CFO transition and other charges in 2Q14 and $1.0 million legal award in 2Q13; see page 4 for additional disclosure

Bovie Medical Corporation
Condensed Consolidated Statements of Operations
For the Three and Six Months Ended June 30, 2014 and 2013
(UNAUDITED) (in thousands except per share data)

Three Months Ended Six Months Ended
June 30, June 30,
2014 2013 2014 2013

Sales $ 6,945 $ 6,042 $ 13,427 $ 11,738
Cost of Sales 5,068 3,812 8,793 7,357
Gross Profit 1,877 2,230 4,634 4,381
27.0 % 36.9 % 34.5 % 37.3 %
Costs and Expenses:
Research & Development 318 314 651 647
Professional services 287 383 544 836
Salaries and related costs 1,419 999 2,326 1,818
Selling, General and Administrative 1,599 2,184 2,800 3,395
Total Expenses 3,623 3,880 6,321 6,696
52.2 % 64.2 % 47.1 % 57.0 %

Loss from operations (1,746 ) (1,650 ) (1,687 ) (2,315 )
Interest (net of interest income) (40 ) (60 ) (69 ) (116 )
Gain (loss) on change in fair value of derivative liabilities 1,454 37 (8,145 ) 3
Pre-Tax loss (332 ) (1,673 ) (9,901 ) (2,428 )
Benefit for income tax 583 554 545 899
Net Income/(loss) 251 (1,119 ) (9,356 ) (1,529 )
Accretion on convertible preferred stock (222 ) - (426 ) -
Net Income/(loss) attributable to common shareholders (Note 3) 29 (1,119 ) (9,782 ) (1,529 )

Income (loss) per share
Basic $ 0.00 ($0.06 ) ($0.55 ) ($0.09 )
Diluted $ (0.07 ) ($0.06 ) ($0.55 ) ($0.09 )

Weighted average number of shares outstanding - basic 17,717

17,669 17,667 17,660

Weighted average number of shares outstanding - diluted 21,176 (Note 1) 17,669 17,667 (Note 2) 17,660

(Note 1) For the three months ended June 30, 2014, options and warrants to purchase shares of common stock were included in the computation of diluted earnings per share because their effects were dilutive, while the conversion of Series A Preferred Stock into 3,500,000 shares of common stock were excluded from the computation of diluted earnings per share as the effect is anti-dilutive.

(Note 2) For the six months ended June 30, 2014, options and warrants to purchase shares of common stock and Series A Preferred Stock were excluded in the computation of diluted earnings per share because their effects were anti-dilutive.

(Note 3) Amounts reflected in the presentation of calculations may be impacted by rounding.

Bovie Medical Corporation
Condensed Consolidated Balance Sheets
June 30, 2014 and December 31, 2013
(in thousands)

ASSETS 6/30/2014 12/31/2013
(unaudited)
Current assets:
Cash and cash equivalents $5,575 $7,924
Restricted cash 898 -
Trade accounts receivable, net 2,617 1,990
Inventories, net 6,922 8,415
Current portion of deposits 1,235 948
Prepaid expenses 857 545
Total current assets 18,104 19,822

Property and equipment, net 6,863 7,063

Other assets:
Brand Name/Trademark 1,510 1,510
Purchased Technology (net) 485 575
Deferred tax Asset 3,961 3,412
Deposits, net of current portion 69 120
Other assets 607 674

Total Assets (Note 1) $31,599 $33,176

(Note 1) Amounts reflected in the presentation of calculations may be impacted by rounding.

Bovie Medical Corporation
Condensed Consolidated Balance Sheets
June 30, 2014 and December 31, 2013
(in thousands)

6/30/2014 12/31/2013
Liabilities and Stockholders Equity (unaudited)

Current Liabilities:
Accounts payable $1,031 $1,060
Accrued expenses and other liabilities 1,254 1,766
Customer deposits 15 15
Total current liabilities 2,299 2,840

Other Liabilities:
Notes payable 3,532 3,257
Derivative liability 13,473 5,749
Total other liabilities 17,005 9,006

Total Liabilities 19,304 11,846

Series A, 6% convertible preferred stock (par value $.001;
3,500,000 shares authorized and issued)
2,684 2,259

Stockholders equity:
Common Stock (par value $.001 40,000,000 shares authorized) 18 18
Additional paid in capital 29,009 28,688
Accumulated deficit (19,416) (9,634)
Total stockholders equity 9,611 19,071

Total Liabilities and stockholder's equity (Note 1) $31,599 $33,176

(Note 1) Amounts reflected in the presentation of calculations may be impacted by rounding.

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL MEASURES
( in thousands except per share data)

Three Months Ended Six Months Ended
June 30, (unaudited) June 30, (unaudited)
2014 2013 2014 2013

Net income/(loss) (GAAP basis) $ 251 $ (1,119 ) $ (9,356 ) $ (1,529 )
Accretion on convertible preferred stock (222 ) (426 )
Net income/(loss) attributable to common shareholders $ 29 $ (1,119 ) $ (9,782 ) $ (1,529 )
Net income/(loss) per share - basic (GAAP basis) $ 0.00 $ (0.06 ) $ (0.55 ) $ (0.09 )
Net income/(loss) per share - diluted (GAAP basis) $ (0.07 ) $ (0.06 ) $ (0.55 ) $ (0.09 )

Other non-GAAP adjustments:
(Gain)/ loss on change in fair value of derivative liabilities $ (1,454 ) $ (37 ) $ 8,145 $ (3 )
Increase in inventory E&O reserve 843 843
CFO transition costs 340 340
Other administrative expenses 43 43
Accretion on convertible preferred stock 222 $ - 426 $ -
Legal settlement 0 $ 1,041 0 $ 1,041
Tax impact on non-GAAP adjustments (483 ) (345 ) (551 ) (345 )
Adjusted non-GAAP net (loss) $ (460 ) $ (460 ) $ (536 ) $ (836 )

Income/(loss) per share - basic on: (Note 1)
Gain on change in fair value of derivative liabilities (0.08 ) 0.00 0.46 0.00
Increase in inventory E&O reserve 0.05 0.00 0.05 0.00
Executive management transition costs 0.02 0.00 0.02 0.00
Other expenses 0.00 0.00 0.00 0.00
Accretion on convertible preferred stock 0.01 0.00 0.02 0.00
Legal settlement 0.00 0.06 0.00 0.06
Tax impact on non-GAAP adjustments (0.03 ) (0.02 ) (0.03 ) (0.02 )
Adjusted non-GAAP net income/(loss) per share - basic and diluted (Note 1) $ (0.03 ) $ (0.03 ) $ (0.03 ) $ (0.05 )

Weighted average number of shares outstanding - basic and diluted (Note 2) 17,717 17,669 17,667 17,660

(Note 1) Amounts reflected in the presentation of EPS calculations may be impacted by rounding.

(Note 2) For the three and six months ended June 30, 2014 and 2013, respectively, gains, losses and accretion were excluded from the adjusted non-GAAP net income/(loss) as were the respective diluted shares associated with those instruments for purposes of the EPS calculation.

Contact:
Investor Relations:
MBS Value Partners
Lynn Morgen and Hugh Collins
212.750.5800
Investor.relations@boviemed.com

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