Sunrise Increases Sales and Other Income 116% and Decreases Expenses 37% Q1 '01 VS. Q4 '00

Apr 26, 2001, 01:00 ET from Sunrise Technologies Inc.

    FREMONT, Calif., April 26 /PRNewswire/ --
 Sunrise Technologies International, Inc. (Nasdaq:   SNRS) -- today announced
 financial results for the first quarter ended March 31, 2001.
     Revenues and other income for the first quarter of 2001 were $6,417,000 as
 compared to $18,000 for the same period in 2000 and $2,968,000 for the
 fourth quarter of 2000.  This represents an increase of $6,399,000 in revenues
 and other income from the first quarter of 2000 and an increase of  $3,449,000
 or 116% from the fourth quarter of 2000.
     "We believe the increase in sales is due to increasing acceptance and
 adoption of the SUNRISE LTK(TM) procedure by ophthalmic surgeons.  Our
 procedure revenue was 51% higher in the first quarter of 2001 vs. the previous
 quarter.  We believe doctors are learning how to attract and treat hyperopic
 patients, and as these success stories spread throughout the ophthalmic
 community we believe even greater acceptance of the SUNRISE LTK procedure will
 occur," according to C. Russell Trenary III, Chairman & CEO of Sunrise.
     The Company reports that the sales efforts of its refractive business
 managers and the sales representatives of its exclusive U.S. distributor, U.S.
 Medical have helped increase the sales figures.  The installed base of
 HYPERION LTK Systems exceeds 100 units.  In addition, the Company reports that
 it is experiencing increases in its sales lead flow in the first quarter vs.
 the fourth quarter of 2000.
     "In addition, our surveys continue to show that consumers very much prefer
 a safe procedure before they will choose to have refractive surgery.  We
 believe safety is the strongest attribute of the SUNRISE LTK procedure, as
 evidenced by the number of eye doctors having it performed on themselves,"
 added Trenary.
     Operating expenses for the first quarter of 2001 were $4,763,000 as
 compared to $5,032,000 for the same period in 2000 and  $7,562,000 for the
 fourth quarter of 2000. This represents a 5% decrease from the first quarter
 of 2000 and a 37% decrease from the fourth quarter of 2000.  The decrease in
 operating expenses from both the first and fourth quarters of 2000 results
 from the Company's restructuring efforts and reductions in non-cash expenses.
 Inclusive in the operating expenses for the first quarter of 2001 was
 $226,000 of non-cash compensation expenses as compared with $81,000 for the
 first quarter of 2000 and  $1,105,000 for the fourth quarter of 2000. Non-cash
 compensation expenses represent the fair market value of warrants and
 non-qualified stock options issued to employees and consultants in lieu of
 cash.
     The category of other expense for the first quarter of 2001 of $704,000 or
 18% of the loss for the quarter was a one time restructuring charge for
 amounts paid or accrued for severances and other expenses related to the
 reduction in force that occurred in the first four months of 2001.  Payment of
 severance awards by the Company was with 365,156 shares of common stock in
 lieu of cash.
     Net loss was $4,011,000, or $0.08 per share, in the first quarter of
 2001 as compared to a net loss of $16,033,000 or $0.35 per share, in the first
 quarter of 2000 and $6,019,000 or $0.12 per share for the fourth quarter of
 2000.  Approximately $791,000, or 20% of the net loss for the first quarter of
 2001, or $0.02 per share, was primarily attributable to non-cash expenses
 associated with the financing costs for the January 2000 private placement and
 the $10,000,000 revolving bank line of credit, which is guaranteed by one of
 the Company's investors.  This compares with non-cash expenses of
 $10,248,000 or $0.22 per share, or 64% of the net loss for the first quarter
 of 2000, and $1,435,000, or $0.03 per share or 24% of the net loss for the
 fourth quarter of 2000.  Net loss per share for the first quarter of 2001,
 when adjusted for non-cash expenses and the one time restructuring expense was
 $0.04 per share.  The Company believes second quarter operations will be cash
 flow positive to neutral, as inventories continue to decrease and accounts
 receivable are collected.
     The Company closed the first quarter of 2001 with cash and cash
 equivalents of $168,000 and working capital of $1,259,000 as compared to
 $975,000 in cash and cash equivalents and working capital of $6,332,000 at
 December 31, 2000.
     Except for historical information, this news release contains certain
 forward-looking statements that involve risk and uncertainties which may cause
 actual results to differ materially from the statements made, including market
 potential, regulatory clearances, business growth, and other risks listed from
 time to time in the Company's Securities and Exchange Commission (SEC)
 filings.  These forward-looking statements represent the Company's judgment,
 as of the date of this release, and the Company disclaims any intent or
 obligation to update these forward-looking statements.
     Sunrise Technologies International, Inc. is a refractive surgery company
 based in Fremont, California, that produces holmium:YAG laser-based systems
 that utilize a patented process for shrinking collagen developed by
 Dr. Bruce Sand (the "Sand Process") in correcting ophthalmic refractive
 conditions.
     The U.S. Food and Drug Administration approved the Company's
 HYPERION LTK(TM) System on June 30, 2000 for the temporary reduction of
 hyperopia in patients with +0.75 TO +2.50 diopters of MRSE with less than or
 equal to +/- 0.75 diopters of astigmatism, who are 40 years of age or older
 with documented stability of refraction for the prior 6 months, as
 demonstrated by a change of less than or equal to 0.50D in spherical and
 cylindrical components of the manifest refraction. The magnitude of correction
 with this treatment diminishes over time, with some patients retaining some or
 all of their refractive correction.  New labeling says that, based upon
 existing information for the clinical parameters used in the U.S. clinical
 trial, the Company's model for the average longevity for the procedure
 indicates that some of the effect lasts 10 years and beyond, and that age
 related drift towards hyperopia contributes to the loss of effect after the
 initial two years.  Nomograms that are already in use outside of the U.S.
 treat up to 5.625 diopters of hyperopia and the effect can last longer than a
 patient's lifetime.
     Internet users can access Sunrise's World Wide Web site at
 http://www.sunrise-tech.com .
 
                      Sunrise Technologies International, Inc.
                   Condensed Consolidated Statement of Operations
                                    (unaudited)
                        (In thousands except per share data)
 
                                                          Three months ended
                                                              March 31,
                                                         2001           2000
 
     Revenues:
 
      Product                                          $5,140            $--
      Procedure                                           202             --
      Service & other                                     375             18
         Total revenues                                 5,717             18
     Cost of revenues:
      Product                                           3,613             --
      Procedure                                            --             --
      Service & other                                     288            719
         Total cost of revenues                         3,901            719
     Gross profit (loss)                                1,816          (701)
     Total operating expenses                         (4,763)        (5,032)
     Operating loss                                   (2,947)        (5,733)
     Interest expense, net                            (1,060)       (10,300)
     Other income                                         700             --
     Other expense                                      (704)             --
     Net loss                                        $(4,011)      $(16,033)
     Net loss per share, basic and diluted            $(0.08)        $(0.35)
     Shares used in calculation of
      basic and diluted net loss per share             51,015         46,406
 
 
                      Sunrise Technologies International, Inc.
                       Condensed Consolidated Balance Sheets
                                   (In thousands)
 
                                                      March 31,   December 31,
                                                         2001         2000
                                                     (Unaudited)   (Audited)
 
     Assets
     Current assets:
      Cash & cash equivalents                            $168         $975
      Accounts and other receivables, net               4,378        3,268
      Inventories, net                                 10,181       11,981
      Other current assets, net                           211          405
     Total current assets                              14,938       16,629
     Property and equipment, net                        2,339        2,528
     Intangibles, net                                   7,857        7,995
     Non-current assets                                 3,898        1,374
     Total assets                                     $29,032      $28,526
 
     Liabilities and stockholders' equity
     Current liabilities:
      Borrowings under a line of credit                $6,663       $3,034
      Current portion of capital leases and
       notes payable                                      319          307
      Accounts payable                                  1,983        3,162
      Accrued liabilities                               1,562        1,564
      Deferred revenue                                  2,493        1,047
      Deposits                                            659        1,183
     Total current liabilities                         13,679       10,297
 
     Long-term debt                                     7,877        7,654
     Deferred revenue, net of current portion             939        1,077
     Other long-term liabilities                          142          136
     Total stockholders' equity                         6,395        9,362
     Total liabilities & stockholders' equity         $29,032      $28,526
 
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SOURCE Sunrise Technologies Inc.
    FREMONT, Calif., April 26 /PRNewswire/ --
 Sunrise Technologies International, Inc. (Nasdaq:   SNRS) -- today announced
 financial results for the first quarter ended March 31, 2001.
     Revenues and other income for the first quarter of 2001 were $6,417,000 as
 compared to $18,000 for the same period in 2000 and $2,968,000 for the
 fourth quarter of 2000.  This represents an increase of $6,399,000 in revenues
 and other income from the first quarter of 2000 and an increase of  $3,449,000
 or 116% from the fourth quarter of 2000.
     "We believe the increase in sales is due to increasing acceptance and
 adoption of the SUNRISE LTK(TM) procedure by ophthalmic surgeons.  Our
 procedure revenue was 51% higher in the first quarter of 2001 vs. the previous
 quarter.  We believe doctors are learning how to attract and treat hyperopic
 patients, and as these success stories spread throughout the ophthalmic
 community we believe even greater acceptance of the SUNRISE LTK procedure will
 occur," according to C. Russell Trenary III, Chairman & CEO of Sunrise.
     The Company reports that the sales efforts of its refractive business
 managers and the sales representatives of its exclusive U.S. distributor, U.S.
 Medical have helped increase the sales figures.  The installed base of
 HYPERION LTK Systems exceeds 100 units.  In addition, the Company reports that
 it is experiencing increases in its sales lead flow in the first quarter vs.
 the fourth quarter of 2000.
     "In addition, our surveys continue to show that consumers very much prefer
 a safe procedure before they will choose to have refractive surgery.  We
 believe safety is the strongest attribute of the SUNRISE LTK procedure, as
 evidenced by the number of eye doctors having it performed on themselves,"
 added Trenary.
     Operating expenses for the first quarter of 2001 were $4,763,000 as
 compared to $5,032,000 for the same period in 2000 and  $7,562,000 for the
 fourth quarter of 2000. This represents a 5% decrease from the first quarter
 of 2000 and a 37% decrease from the fourth quarter of 2000.  The decrease in
 operating expenses from both the first and fourth quarters of 2000 results
 from the Company's restructuring efforts and reductions in non-cash expenses.
 Inclusive in the operating expenses for the first quarter of 2001 was
 $226,000 of non-cash compensation expenses as compared with $81,000 for the
 first quarter of 2000 and  $1,105,000 for the fourth quarter of 2000. Non-cash
 compensation expenses represent the fair market value of warrants and
 non-qualified stock options issued to employees and consultants in lieu of
 cash.
     The category of other expense for the first quarter of 2001 of $704,000 or
 18% of the loss for the quarter was a one time restructuring charge for
 amounts paid or accrued for severances and other expenses related to the
 reduction in force that occurred in the first four months of 2001.  Payment of
 severance awards by the Company was with 365,156 shares of common stock in
 lieu of cash.
     Net loss was $4,011,000, or $0.08 per share, in the first quarter of
 2001 as compared to a net loss of $16,033,000 or $0.35 per share, in the first
 quarter of 2000 and $6,019,000 or $0.12 per share for the fourth quarter of
 2000.  Approximately $791,000, or 20% of the net loss for the first quarter of
 2001, or $0.02 per share, was primarily attributable to non-cash expenses
 associated with the financing costs for the January 2000 private placement and
 the $10,000,000 revolving bank line of credit, which is guaranteed by one of
 the Company's investors.  This compares with non-cash expenses of
 $10,248,000 or $0.22 per share, or 64% of the net loss for the first quarter
 of 2000, and $1,435,000, or $0.03 per share or 24% of the net loss for the
 fourth quarter of 2000.  Net loss per share for the first quarter of 2001,
 when adjusted for non-cash expenses and the one time restructuring expense was
 $0.04 per share.  The Company believes second quarter operations will be cash
 flow positive to neutral, as inventories continue to decrease and accounts
 receivable are collected.
     The Company closed the first quarter of 2001 with cash and cash
 equivalents of $168,000 and working capital of $1,259,000 as compared to
 $975,000 in cash and cash equivalents and working capital of $6,332,000 at
 December 31, 2000.
     Except for historical information, this news release contains certain
 forward-looking statements that involve risk and uncertainties which may cause
 actual results to differ materially from the statements made, including market
 potential, regulatory clearances, business growth, and other risks listed from
 time to time in the Company's Securities and Exchange Commission (SEC)
 filings.  These forward-looking statements represent the Company's judgment,
 as of the date of this release, and the Company disclaims any intent or
 obligation to update these forward-looking statements.
     Sunrise Technologies International, Inc. is a refractive surgery company
 based in Fremont, California, that produces holmium:YAG laser-based systems
 that utilize a patented process for shrinking collagen developed by
 Dr. Bruce Sand (the "Sand Process") in correcting ophthalmic refractive
 conditions.
     The U.S. Food and Drug Administration approved the Company's
 HYPERION LTK(TM) System on June 30, 2000 for the temporary reduction of
 hyperopia in patients with +0.75 TO +2.50 diopters of MRSE with less than or
 equal to +/- 0.75 diopters of astigmatism, who are 40 years of age or older
 with documented stability of refraction for the prior 6 months, as
 demonstrated by a change of less than or equal to 0.50D in spherical and
 cylindrical components of the manifest refraction. The magnitude of correction
 with this treatment diminishes over time, with some patients retaining some or
 all of their refractive correction.  New labeling says that, based upon
 existing information for the clinical parameters used in the U.S. clinical
 trial, the Company's model for the average longevity for the procedure
 indicates that some of the effect lasts 10 years and beyond, and that age
 related drift towards hyperopia contributes to the loss of effect after the
 initial two years.  Nomograms that are already in use outside of the U.S.
 treat up to 5.625 diopters of hyperopia and the effect can last longer than a
 patient's lifetime.
     Internet users can access Sunrise's World Wide Web site at
 http://www.sunrise-tech.com .
 
                      Sunrise Technologies International, Inc.
                   Condensed Consolidated Statement of Operations
                                    (unaudited)
                        (In thousands except per share data)
 
                                                          Three months ended
                                                              March 31,
                                                         2001           2000
 
     Revenues:
 
      Product                                          $5,140            $--
      Procedure                                           202             --
      Service & other                                     375             18
         Total revenues                                 5,717             18
     Cost of revenues:
      Product                                           3,613             --
      Procedure                                            --             --
      Service & other                                     288            719
         Total cost of revenues                         3,901            719
     Gross profit (loss)                                1,816          (701)
     Total operating expenses                         (4,763)        (5,032)
     Operating loss                                   (2,947)        (5,733)
     Interest expense, net                            (1,060)       (10,300)
     Other income                                         700             --
     Other expense                                      (704)             --
     Net loss                                        $(4,011)      $(16,033)
     Net loss per share, basic and diluted            $(0.08)        $(0.35)
     Shares used in calculation of
      basic and diluted net loss per share             51,015         46,406
 
 
                      Sunrise Technologies International, Inc.
                       Condensed Consolidated Balance Sheets
                                   (In thousands)
 
                                                      March 31,   December 31,
                                                         2001         2000
                                                     (Unaudited)   (Audited)
 
     Assets
     Current assets:
      Cash & cash equivalents                            $168         $975
      Accounts and other receivables, net               4,378        3,268
      Inventories, net                                 10,181       11,981
      Other current assets, net                           211          405
     Total current assets                              14,938       16,629
     Property and equipment, net                        2,339        2,528
     Intangibles, net                                   7,857        7,995
     Non-current assets                                 3,898        1,374
     Total assets                                     $29,032      $28,526
 
     Liabilities and stockholders' equity
     Current liabilities:
      Borrowings under a line of credit                $6,663       $3,034
      Current portion of capital leases and
       notes payable                                      319          307
      Accounts payable                                  1,983        3,162
      Accrued liabilities                               1,562        1,564
      Deferred revenue                                  2,493        1,047
      Deposits                                            659        1,183
     Total current liabilities                         13,679       10,297
 
     Long-term debt                                     7,877        7,654
     Deferred revenue, net of current portion             939        1,077
     Other long-term liabilities                          142          136
     Total stockholders' equity                         6,395        9,362
     Total liabilities & stockholders' equity         $29,032      $28,526
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X57756311
 
 SOURCE  Sunrise Technologies Inc.