WALNUT CREEK, Calif., May 21 /PRNewswire-FirstCall/ -- BSML, Inc.,
formerly known as BriteSmile, Inc., (BSML.pk) today announced its
financial results for its fiscal first quarter ended March 31,
2007. Revenues from continuing operations increased approximately
19%, to $7.2 million in the first quarter of 2007 compared to $6.0
million in the first quarter of 2006. Center revenues, primarily
related to performance of our whitening procedures, increased by
$0.8 million, with sales of our products through other channels,
primarily the QVC network, contributing the balance of the increase
in revenue. The Company's first quarter 2007 net loss from
continuing operations was $0.4 million in 2007, compared with $9.3
million in the first quarter of 2006. Included in the net loss from
continuing operations for 2006 are non-recurring items of $6.5
million, including a $5.0 million loss associated with early
extinguishment of debt, $0.5 million in debt discount amortization
on now-retired debt and $1.0 million in other non- recurring
expenses. The Company does not expect similar non-recurring
expenses of this magnitude in 2007 or future periods. The Company
had no income from discontinued operations in the first quarter of
2007. However, the Company's sale of its Associated Centers
business in first quarter of 2006 resulted in income from
discontinued operations of $21.0 million. This figure was
subsequently revised to reflect additional legal expenses, net of
tax, of $1.7 million, resulting in income from discontinued
operations for fiscal 2006, net of tax, of $19.3 million. The
Company's net loss in the first quarter of 2007 was $0.4 million,
compared with net income of $11.7 million in 2006. The Company's
loss per common share was $0.04 in the first quarter of 2007,
compared with net income per common share of $1.11 in the first
quarter of 2006. The Company's net loss per common share from
continuing operations in the first quarter of 2007 was $0.04
compared with a net loss from continuing operations per common
share of $0.88 in the first quarter of 2006. EBITDA (earnings
before interest, tax, depreciation, and amortization) for the first
quarter ended March 31, 2007 was a loss of $0.1 million, compared
to a loss of $2.6 million in the first quarter of 2006. EBITDA is a
non-GAAP financial measure. More information regarding this
non-GAAP financial measure, and a reconciliation of EBITDA to net
loss, the most directly comparable GAAP measure, is provided below.
Dr. Julian Feneley, BSML's President and Chief Executive Officer,
commented on the Company's results as follows: "The comparison of
first quarter 2007 financial results with the same period last year
demonstrates the positive impact on center revenue of the reduced
procedure pricing that was introduced in April 2006. In addition,
we're also very pleased to see a significant increase in our
revenues from distribution of our BriteSmile To Go(TM) product
through the QVC network. Our efforts going forward are focused on
optimizing marketing and controlling operating expenses in our
center business." The Company finished its 2007 fiscal first
quarter with $3.5 million in cash, compared with $4.7 million at
December 30, 2006. The decrease is entirely due to operating uses,
including payments to vendors and for income taxes and the
redemption of outstanding gift certificates. Non-GAAP Financial
Information BSML provides non-GAAP EBITDA, or earnings before
interest, taxes, depreciation and amortization, as additional
information for its operating results. These measures are not in
accordance with or an alternative for financial measures calculated
in accordance with generally accepted accounting principles,
including net income or loss, the most directly comparable GAAP
measure, and may be different from non-GAAP measures used by other
companies. BSML's management believes this non-GAAP measure is
useful to investors because of: (i) the significant amount of
non-cash depreciation and amortization historically incurred by the
Company in its operating results, (ii) the non-cash amortization of
the discount on debt of $0.5 million in the first quarter of 2006,
and (iii) the loss on the early extinguishment of debt of $5.0
million reported in the first quarter of 2006. Our calculation of
EBITDA further excludes results from discontinued operations.
Investors are cautioned that the items excluded from EBITDA are
significant components in understanding and assessing BSML's
financial performance. BSML, Inc., formerly known as BriteSmile,
Inc., markets the most advanced teeth whitening technology
available and manages state-of-the-art BriteSmile Professional
Teeth Whitening Centers. BSML Spa Centers are currently operating
in Beverly Hills, Irvine, Palo Alto, Walnut Creek, San Francisco
and La Jolla, CA; Houston, TX; Denver, CO; Boston, MA; McLean, VA;
Atlanta, GA; New York, NY; Chicago and Schaumburg, IL; and,
Phoenix, AZ. For more information about BSML's procedures, call
1-800-BRITESMILE or visit the Company's Website at
http://www.britesmile.com/. This release, other than historical
information, consists of forward- looking statements that involve
risks and uncertainties. Readers are referred to the documents
filed by BSML with the Securities and Exchange Commission,
specifically the Company's most recent reports on Forms 10-K,
10-K/A and 10-Q, that identify important risk factors which could
cause actual results to differ from those contained in the
forward-looking statements. BSML and its affiliates disclaim any
intent or obligation to update these forward-looking statements.
Condensed Consolidated Statement of Operations Unaudited (In
thousands, except per share amounts) 13 Weeks 13 Weeks Ended Ended
April 1, 2006 March 31, 2007 (restated) Revenues $7,161 $6,035
Operating costs and expenses: Operating and occupancy costs 3,644
3,338 Selling, general and administrative expenses 3,666 5,336
Depreciation and amortization 362 107 Total operating costs and
expenses 7,672 8,781 Loss from operations (511) (2,746)
Amortization of discount on debt -- (530) Loss on early
extinguishment of debt -- (5,039) Other income / (expense), net 141
(964) Loss from continuing operations before income tax provision
(370) (9,279) Income tax provision 18 35 Net loss from continuing
operations (388) (9,314) Discontinued operations Income from
discontinued operations, net of tax (thirteen weeks ended April 1,
2006, includes gain from sale of business of $15,794, net of tax,
and gain on settlement of litigation of $5,202, net of tax) --
20,996 Net income (loss) attributable to common shareholders $(388)
$11,682 Basic and diluted net loss per common share from continuing
operations $(0.04) $(0.88) Basic net income (loss) per common share
from discontinued operations $-- $1.99 Diluted net income (loss)
per common share from discontinued operations $-- $1.99 Basic net
income (loss) per common share $(0.04) $1.11 Diluted net income
(loss) per common share $(0.04) $1.11 Shares used in computing net
loss per common share from continuing operations, basic and diluted
10,717,614 10,549,130 Shares used in computing net income per
common share from discontinued operations, basic 10,717,614
10,549,130 Shares used in computing net income (loss) per common
share from discontinued operations, diluted 10,717,614 10,555,130
Shares used in computing net income (loss) per common share, basic
10,717,614 10,549,130 Shares used in computing net income (loss)
per common share, diluted 10,717,614 10,555,130 Condensed
Consolidated Balance Sheet Unaudited (In thousands) March 31,
December 30, 2007 2006 (Unaudited) ASSETS Current assets Cash and
cash equivalents $3,468 $4,734 Trade accounts receivable, net 445
213 Inventories 1,084 1,273 Investments, restricted as to use 3,666
3,625 Prepaid expenses and other current assets 273 243 Total
current assets 8,936 10,088 Property and equipment, net 3,896 4,258
Investments, restricted as to use 2,681 2,761 Other assets 969 958
Total assets $16,482 $18,065 LIABILITIES AND SHAREHOLDERS' EQUITY
(DEFICIT) Current liabilities: Accounts payable $1,287 $1,770
Accrued liabilities 6,195 6,776 Accrual for Center closures 266 170
Gift certificate liability 1,456 1,775 Deferred revenue 2,819 2,590
Total current liabilities 12,023 13,081 Long term liabilities:
Accrual for Center closures 134 258 Deferred revenue 1,159 1,352
Other long term liabilities 841 892 Total long term liabilities
2,134 2,502 Total liabilities 14,157 15,583 Shareholders' equity
(deficit): Common stock, $0.001 par value, 50,000,000 shares
authorized, 10,744,281 and 10,664,281 shares issued and outstanding
at March 31, 2007 and December 30, 2006, respectively 39 39
Additional paid-in capital 174,134 173,903 Accumulated deficit
(171,848) (171,460) Total shareholders' equity (deficit) 2,325
2,482 Total liabilities and shareholders' equity (deficit) $16,482
$18,065 Reconciliation of Net Income / (Loss) to EBITDA Unaudited
(In thousands) 13 Weeks 13 Weeks Ended Ended April 1, 2006 March
31, 2007 (restated) Net income (loss) $(388) $11,682 Deduct: income
from discontinued operations -- (20,996) Add: income tax provision
18 35 Add (deduct): other income / (expense), net (141) 964 Add:
loss on early extinguishment of debt -- 5,039 Add: amortization of
discount on debt -- 530 Add: depreciation and amortization 362 107
EBITDA $(149) $(2,639) DATASOURCE: BSML, Inc. CONTACT: investors,
Rich De Young CFO, +1-925-279-2883, or media, Dr. Julian Feneley
CEO, +1-925-279-2863, both of BSML, Inc. Web site:
http://www.britesmile.com/
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