Lancer Orthodontics Announces Un-Audited Financial Year-End Results SAN MARCOS, Calif., July 15 /PRNewswire-FirstCall/ -- Lancer Orthodontics, Inc. (OTC:LANZ) today announced its un-audited financial results for its fiscal year ended May 31, 2005. Lancer is currently proceeding with its year-end audit, and as such, its year-end actual results may substantially differ from the information provided in this press release if material adjustments to its financial information are required or deemed appropriate during the course of its audit. Lancer reported un-audited net sales for fiscal year 2005 of $5,977,590 compared to audited net sales of $6,024,009 in fiscal 2004, a decrease of $46,418 or less than 1%. The un-audited net loss was ($274,850) or $0.09 per share in fiscal 2005, compared to a net income of $28,951 or $0.01 per share in fiscal 2004. Increases in sales and marketing expenses as well as non-capitalized investments relating to new product development and strategic agreements were the main reason for the un-audited net loss. Lancer also reported that on March 16, 2005 the Company signed a three-year strategic marketing, sales and manufacturing agreement with Lingualcare, Inc. Lingualcare is an orthodontics technology and services company with a new proprietary, patented technology for straightening teeth. The substantive terms of the agreement provide for Lancer to introduce, market and promote Lingualcare's orthodontic products on an exclusive basis in conjunction with Lingualcare in the North and South American markets and to become the supplier of those products to Lingualcare. Lancer expects to manufacture those products in its Mexico facility. Upon Lancer's initiation of commercial production of the products, Lingualcare shall compensate Lancer for the production on a per unit basis. Lingualcare is also obligated to pay Lancer a sales commission on sales of the product in the North American and South American markets on sales Lancer participates in generating. In addition, if and when certain manufacturing and sales milestones have been reached by the companies during the term of the agreement, Lingualcare shall issue a series of shares of its common stock and common stock purchase warrants to Lancer. Lancer may maintain jointly exclusive market rights only upon the achievement of certain sales milestones by the companies during the term of the agreement. Under the agreement Lancer is required to purchase more than $600,000 in new manufacturing equipment, upgrade its manufacturing center in its current Mexico facility to manufacture the products and to incur substantial sales and marketing expenditures to introduce, promote and market Lingualcare's products in North and South America. There can be no assurance that Lancer will be able to commence and maintain commercial manufacture of Lingualcare's products, which are relatively new in the marketplace. Accordingly, even if commercial manufacture of the products commences and is maintained by Lancer, it is unable to provide any reliable guidance regarding sales of Lingualcare's products. Therefore, there can be no assurances Lingualcare's products will produce adequate revenues substantial enough to Lancer for its investment risk, for Lancer rights to be issued any Lingualcare common stock or any Lingualcare common stock purchase warrants, or for Lancer to maintain its jointly exclusive marketing rights. Lancer anticipates it will raise approximately $500,000 in equity or debt prior to August 31, 2005 to enable it to meet its anticipated near term obligations under the agreement. Lancer also announced today that it has reached an agreement in principal with a large US orthodontic distributor who will be purchasing various Lancer orthodontic brackets and products, and reselling these items under the distributors own private label. The actual amount of product to be purchased by this new customer has not yet been determined, however Lancer management believes that this relationship could result in gross revenues to Lancer in excess of $500,000 per year. About Lingualcare Lingualcare, Inc., a private company located in Dallas, Texas, was organized in October 2002. Lingualcare is an orthodontics technology and services company with a new proprietary, patented technology for straightening teeth. The company's principal product, iBraces(TM), consists of customized and individualized metal braces that are placed on the tongue (lingual) side of the teeth. About Lancer Orthodontics Lancer Orthodontics develops, manufactures and/or markets over 5000 different orthodontic products worldwide. As previously announced, in January 2005, it filed a Form 15 with the SEC which filing suspended its duty to file periodic reports under Sections 13 and 15(d) of the Securities and Exchange Commission (SEC) Act of 1934. As such, Lancer is no longer obligated to file public reports with the SEC, such as Annual Reports on Form 10KSB, Quarterly Reports on Form 10-QSB, Current Reports of Form 8-K, and Proxy or Information Statements on Schedule 14a or 14c, or to furnish the SEC Annual Reports to shareholders in connection with any such Proxy or Information Statements. This is the only press release Lancer currently anticipates issuing with respect to its Fiscal 2005 financial results, and any current developments within the company. At this time, management feels the above information summarizes the major material information and events that have occurred since the filing of Lancer's fiscal 2005 first quarter 10QSB. The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. Certain information included in this press release (as well as information included in oral statements or other written statements made or to be made by Lancer Orthodontics) contains statements that are forward-looking; such as statements relating to sales growth, profitability, new products slated for release, intended launch dates, commercial production, expansion, significant growth, expected orders, cost saving programs, sales generating programs, anticipated future revenues or production volume of the company, success of product and new product offerings such as Lingualcare products. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future, and accordingly, such results may differ materially from those expressed in any forward-looking statements made by or on behalf of Lancer. The potential risks and uncertainties include, among others, fluctuations in the Company's operating results due to its business model and expansion plans, downturns in international and or national economies, the Company's ability to raise additional capital, the competitive environment in which the Company will be competing, and the Company's dependence on strategic relationships. The Company is under no obligation to update any forward-looking statements after the date of this release. DATASOURCE: Lancer Orthodontics, Inc. CONTACT: Allen Barbieri, CEO of Lancer Orthodontics, Inc., +1-760-744-5585 Web site: http://www.lancerortho.com/

Copyright