Encision Reports Profitable Second Fiscal Quarter Results

BOULDER, Colo., Oct. 23 /PRNewswire-FirstCall/ -- Encision Inc.
(Pink Sheets: ECIA), a medical device company owning patented surgical
technology that is emerging as a standard of care in minimally-invasive
surgery, reported its financial results for its second quarter ended September
30, 2008.
Net sales for the second quarter of fiscal year 2009, ended September 30,
2008, totaled $3.35 million, representing an 8% increase over net sales of
$3.09 million for the prior fiscal year's second quarter. The Company recorded
net income of $75 thousand or $.01 per share for the second quarter of fiscal
year 2009 compared to net income of $8 thousand or $.00 per share for the
second quarter of fiscal year 2008. Gross profit margin for the second quarter
of fiscal year 2009 was 61.3% as compared to 62.3% for the second quarter of
fiscal year 2008. The gross profit margin decrease was due to a 0.7% increase
in scrap costs from the second quarter of fiscal year 2008 and increased sales
of lower gross profit margin products. The decrease was partially offset by a
higher gross profit margin from sales of the Company's internally manufactured
disposable scissor inserts and a 0.7% increase to gross profit margin that was
attributed to a decrease in warranty claims.
Net sales for the first six months of fiscal year 2009, ended September
30, 2008, totaled $6.44 million, representing a 12% increase over net sales of
$5.75 million for the prior fiscal year's first six months. The Company
recorded a net loss of $89 thousand or $.01 per share for the first six months
of fiscal year 2009 compared to a net loss of $288 thousand or $.04 per share
for the first six months of fiscal year 2008. Gross profit margin for the
first six months of fiscal year 2009 was 61% as compared to 62% for the first
six months of fiscal year 2008.
"We believe that the major investments we have made in acquiring
manufacturing equipment, expanding our direct sales force and implementing
redesigns to existing products to elevate them to best of class status have
begun to benefit our shareholders during the second quarter that ended
September 30, 2008," said Jack Serino, President and CEO of Encision Inc.
"During the last month, all disposable scissor inserts sales were from
internally manufactured disposable scissor inserts that generated higher gross
margins. We will see the full effect of higher gross profit margins beginning
in the third quarter ending December 31, 2008, when all disposable scissor
inserts sales made in the quarter will be sales from internally manufactured
disposable scissor inserts. Also, during the quarter, we reduced our cost
structure as it relates to engineering projects and we will see the full
effect of these savings beginning in the third quarter ending December 31,
2008."
Encision Inc. designs, develops, manufactures and markets innovative
surgical devices that allow surgeons to optimize technique and patient safety
during a broad range of surgical procedures. Based in Boulder, Colorado, the
Company pioneered the development of patented AEM(R) Laparoscopic Instruments
to improve electrosurgery and reduce the chance for patient injury in
minimally invasive surgery.
In accordance with the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, the Company notes that statements in this press
release and elsewhere that look forward in time, which include everything
other than historical information, involve risks and uncertainties that may
cause actual results to differ materially from those indicated by the
forward-looking statements. Factors that could cause the Company's actual
results to differ materially include, among others, its ability to increase
net sales through the Company's distribution channels, insufficient quantity
of new account conversions, insufficient cash to fund operations, scale up
production to meet delivery obligations, delay in developing new products and
receiving FDA approval for such new products and other factors discussed in
the Company's filings with the Securities and Exchange Commission.
CONTACT: Marcia McHaffie, Encision Inc., 303-444-2600,
mmchaffie@encision.com

Encision Inc.
Condensed Statements of Operations
(Unaudited)
(Amounts in thousands, except per share information)

Three Months Ended Six Months Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2008 2007 2008 2007
NET SALES $3,346 $3,092 $6,440 $5,752
COST OF SALES 1,294 1,166 2,523 2,198
GROSS PROFIT 2,052 1,926 3,917 3,554
OPERATING EXPENSES:
Sales and marketing 1,322 1,237 2,696 2,451
General and
administrative 358 350 725 722
Research and development 280 333 569 664
Total operating
expenses 1,960 1,920 3,990 3,837
OPERATING INCOME (LOSS) 92 6 (73) (283)
Interest and other
income (expense), net (17) 2 (16) (5)
INCOME (LOSS) BEFORE
PROVISION FOR INCOME TAXES 75 8 (89) (288)
Provision for income taxes -- -- -- --
NET INCOME (LOSS) $75 $8 $(89) $(288)
Net income (loss) per
share-basic and diluted $0.01 $0.00 $(0.01) $(0.04)

Encision Inc.
Condensed Balance Sheets
(Amounts in thousands)

Sept. 30, March 31,
2008 2008
(unaudited) (audited)
ASSETS
Cash and cash equivalents $ 300 $ 71
Accounts receivable, net 1,320 1,453
Inventories, net 1,946 2,271
Prepaid expenses 97 99
Total current assets 3,663 3,894
Equipment, net 817 798
Patents, net 203 199
Other assets 39 53
TOTAL ASSETS $ 4,722 $ 4,944

LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable $ 532 $ 537
Accrued compensation 358 392
Other accrued liabilities 397 481
Total current liabilities 1,287 1,410
Long-term debt 505 606
Common stock and additional
paid-in capital 19,477 19,387
Accumulated (deficit) (16,547) (16,459)
Total shareholders' equity 2,930 2,928
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $ 4,722 $ 4,944

SOURCE Encision Inc.

Marcia McHaffie of Encision Inc., +1-303-444-2600, mmchaffie@encision.com