IMI announces fiscal 2004 financial results

Share Name	Share Symbol	Market	Type
Imi International Medical Innovations	AMEX:IME	AMEX	Ordinary Share

Imi Medical Innovations (AMEX:IME)
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IMI announces fiscal 2004 financial results TORONTO, March 31 /PRNewswire-FirstCall/ -- IMI International Medical Innovations Inc. (TSX: IMI; Amex: IME), a leading predictive medicine company, today announced audited financial results for the fiscal year ended December 31, 2004. All amounts are in Canadian dollars. "Fiscal 2004 was an eventful year, with the completion of a significant worldwide marketing agreement with McNeil Consumer Healthcare, Canada, for our cardiovascular products, continuing advances in our clinical program and new publications and presentations," said Dr. Brent Norton, President and Chief Executive Officer. "These accomplishments speak strongly to the scientific credibility and growth opportunities for our products." Dr. Norton continued, "Looking ahead, fiscal 2005 will be a pivotal year for IMI. We are poised to generate revenue from PREVU(x) Point of Care Skin Sterol Test, which is currently being commercialized in Canada, the U.S. and select markets in Europe, where it is available as a point-of-care test. We are also aiming to advance two additional formats of our skin sterol technology. Another key focus will be on accelerating development of our cancer products with new clinical studies and partnering opportunities. Additionally, to date this year three papers about our skin sterol technology have already been accepted for future publication in leading medical journals, including the American Heart Journal. Similarly, three abstracts have been accepted for presentation --- one as recently as yesterday --- including the exciting new data on PREVU(x) presented in early March at the American College of Cardiology annual conference. These are all important accomplishments that will add significant value to our business." Financial Review Total revenue for the year was $485,000, reflecting sales of PREVU(x) Skin Sterol Test to IMI's marketing partner, McNeil Consumer Healthcare, as well as license revenue. The consolidated loss for the year was $5,569,000 ($0.26 per share) compared with $4,063,000 ($0.19 per share) for the year ended December 31, 2003, an increase of $1,506,000. Research and development expenditures increased by $694,000 to $2,613,000 from $1,919,000 in 2003. This variance primarily reflects increased spending on clinical trials for skin sterol and cancer to $488,000 from $235,000 in 2003, related to a lung cancer trial (the I-ELCAP study) and the large skin sterol study being conducted with AtheroGenics, Inc. (the ARISE study) that commenced in the latter part of 2003. IMI currently has 19 clinical trials ongoing, with several, including ARISE, designed to establish the relationship between skin sterol and primary events, such as heart attack. The variance also reflects increased filing fees on intellectual property, which increased to $196,000 from $92,000 in fiscal 2003, and increases in total compensation and benefits for research personnel of $221,000. General and administration expenses amounted to $3,355,000 compared with $2,362,000 in 2003, an increase of $993,000. This variance primarily reflects a one-time cost of $478,000 in 2004 related to IMI's unsolicited offer to acquire the shares of IBEX Technologies Inc. IMI allowed the offer to expire on December 16, 2004 without taking up any shares of IBEX. It also reflects a $221,000 increase in stock-based compensation for options for administrative personnel that resulted in a non-cash expense of $476,000. This increase was primarily for options granted in 2004 pursuant to a U.S. consulting contract that vested over nine months and for the cashless exercise of options by an officer of IMI. Total compensation and benefits for administration personnel increased $160,000, reflecting annual increases plus accrued incentive compensation based on performance. Amortization expenses for equipment and acquired technology amounted to $224,000 compared to $281,000 in 2003. Recoveries of provincial scientific investment tax credits (ITCs) amounted to $205,000 compared with $223,000 in 2003. Interest income amounted to $124,000 compared with $258,000 for 2003. As at December 31, 2004, IMI had cash, cash equivalents and short-term investments totaling $5,196,000 ($6,697,000 as at December 31, 2003). To date, IMI has financed its activities through the issuance of shares and the recovery of provincial ITCs as well as through license fees. Management believes that, based on historic cash expenditures and the current expectation of further revenue from product sales and royalties, IMI's existing cash resources together with the investment tax credits receivable of $389,000 will be sufficient to meet the company's current operating and capital requirements through at least 2005. Financial statements are attached to this press release. IMI's complete fiscal 2004 annual report is available at http://www.sedar.com/. About IMI IMI (http://www.imimedical.com/) is a world leader in predictive medicine, dedicated to developing rapid, non-invasive tests for the early detection of life-threatening diseases. IMI's cardiovascular products, which are branded as PREVU(x) Skin Sterol Test, are marketed and distributed worldwide by McNeil Consumer Healthcare, Canada. The company's cancer tests include ColorectAlert(TM), LungAlert(TM) and a breast cancer test. IMI's head office is located in Toronto, and its research and product development facility is at McMaster University in Hamilton, Ontario. For information regarding PREVU(x), please go visit http://www.prevu.com/. This press release contains forward-looking statements. These statements involve known and unknown risks and uncertainties, which could cause the Company's actual results to differ materially from those in the forward- looking statements. Such risks and uncertainties include, among others, the lack of operating profit and availability of funds and resources to pursue R&D projects, the successful and timely completion of clinical studies, the successful development or marketing of the Company's products, reliance on third-party manufacturers, the competitiveness of the Company's products if successfully commercialized, the ability of the Company to take advantage of business opportunities, uncertainties related to the regulatory process, and general changes in economic conditions. In addition, while the Company routinely obtains patents for its products and technology, the protection offered by the Company's patents and patent applications may be challenged, invalidated or circumvented by our competitors and there can be no guarantee of our ability to obtain or maintain patent protection for our products or product candidates. Investors should consult the Company's quarterly and annual filings with the Canadian and U.S. securities commissions for additional information on risks and uncertainties relating to the forward-looking statements. Investors are cautioned not to rely on these forward-looking statements. IMI is providing this information as of the date of this press release and does not undertake any obligation to update any forward-looking statements contained in this press release as a result of new information, future events or otherwise. IMI International Medical Innovations Inc. Incorporated under the laws of Canada CONSOLIDATED BALANCE SHEETS As at December 31 2004 2003 $ $ ------------------------------------------------------------------------- ASSETS Current Cash and cash equivalents 239,458 61,625 Short-term investments 4,956,945 6,635,135 Accounts receivable 222,348 10,700 Inventory 267,500 - Prepaid expenses and other receivables 137,015 329,789 Investment tax credits receivable 389,000 180,000 ------------------------------------------------------------------------- Total current assets 6,212,266 7,217,249 ------------------------------------------------------------------------- Capital assets, net 420,955 403,205 Acquired technology, net of accumulated amortization of $784,399 (2003 - $693,684) 362,858 453,573 ------------------------------------------------------------------------- 6,996,079 8,074,027 ------------------------------------------------------------------------- ------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Current Accounts payable 1,021,086 139,435 Accrued liabilities 566,951 403,213 Current portion of deferred revenue 306,900 6,900 ------------------------------------------------------------------------- Total current liabilities 1,894,937 549,548 ------------------------------------------------------------------------- Deferred revenue 2,604,300 86,200 ------------------------------------------------------------------------- Total liabilities 4,499,237 635,748 ------------------------------------------------------------------------- Commitments Shareholders' equity Capital stock 24,192,321 24,056,853 Contributed surplus 1,328,187 723,993 Warrants 200,000 312,200 Deficit (23,223,666) (17,654,767) ------------------------------------------------------------------------- Total shareholders' equity 2,496,842 7,438,279 ------------------------------------------------------------------------- 6,996,079 8,074,027 ------------------------------------------------------------------------- ------------------------------------------------------------------------- IMI International Medical Innovations Inc. CONSOLIDATED STATEMENTS OF LOSS AND DEFICIT Years ended December 31 2004 2003 2002 $ $ $ ------------------------------------------------------------------------- REVENUE Product sales 183,258 - - License revenue 302,080 16,900 - ------------------------------------------------------------------------- 485,338 16,900 - Cost of product sales (including amortization of $6,600) 190,214 - - ------------------------------------------------------------------------- Gross profit 295,124 16,900 - ------------------------------------------------------------------------- EXPENSES Research and development 2,612,770 1,918,800 2,104,904 General and administration 3,355,451 2,361,602 2,141,207 Amortization 224,428 280,777 219,466 ------------------------------------------------------------------------- 6,192,649 4,561,179 4,465,577 ------------------------------------------------------------------------- RECOVERIES AND OTHER INCOME Investment tax credits 205,000 223,146 189,908 Interest 123,626 258,422 257,407 ------------------------------------------------------------------------- 328,626 481,568 447,315 ------------------------------------------------------------------------- Net loss for the year (5,568,899) (4,062,711) (4,018,262) Deficit, beginning of year (17,654,767) (13,592,056) (9,573,794) ------------------------------------------------------------------------- Deficit, end of year (23,223,666) (17,654,767) (13,592,056) ------------------------------------------------------------------------- ------------------------------------------------------------------------- Basic and diluted loss per share $(0.26) $(0.19) $(0.20) ------------------------------------------------------------------------- ------------------------------------------------------------------------- Weighted average number of common shares outstanding 21,276,497 20,967,677 20,406,733 ------------------------------------------------------------------------- ------------------------------------------------------------------------- IMI International Medical Innovations Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS Years ended December 31 2004 2003 2002 $ $ $ ------------------------------------------------------------------------- OPERATING ACTIVITIES Net loss for the year (5,568,899) (4,062,711) (4,018,262) Add items not involving cash Amortization 231,028 280,777 219,466 Stock compensation costs included in: Research and development expense 123,925 189,105 81,905 General and administration expense 476,164 255,112 36,483 Loss on sale of capital asset 6,098 3,873 - Net change in non-cash working capital balances related to operations 544,015 (54,970) 30,841 Increase (decrease) in deferred revenue 2,818,100 (6,900) 100,000 ------------------------------------------------------------------------- Cash used in operating activities (1,369,569) (3,395,714) (3,549,567) ------------------------------------------------------------------------- INVESTING ACTIVITIES Short-term investments 1,678,190 3,326,608 (2,603,943) Purchase of capital assets (164,789) (385,605) (20,804) Sale of capital assets 628 2,775 - ------------------------------------------------------------------------- Cash provided by (used in) investing activities 1,514,029 2,943,778 (2,624,747) ------------------------------------------------------------------------- FINANCING ACTIVITIES Issuance of capital stock, net of issue costs 33,373 363,110 5,731,386 ------------------------------------------------------------------------- Cash provided by financing activities 33,373 363,110 5,731,386 ------------------------------------------------------------------------- Net increase (decrease) in cash and cash equivalents during the year 177,833 (88,826) (442,928) Cash and cash equivalents, beginning of year 61,625 150,451 593,379 ------------------------------------------------------------------------- Cash and cash equivalents, end of year 239,458 61,625 150,451 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Represented by: Cash 173,302 61,625 148,270 Cash equivalents 66,156 - 2,181 ------------------------------------------------------------------------- 239,458 61,625 150,451 ------------------------------------------------------------------------- ------------------------------------------------------------------------- DATASOURCE: IMI International Medical Innovations Inc. CONTACT: Company Contact: Sarah Borg-Olivier, Director, Communications, T: (416) 222-3449, ; U.S. Investor Contact: Andrea Faville, Edward Abella, The Investor Relations Group, T: (212) 825-3210, ,

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