Date: Thu, 18 Dec 1997 20:31:40 GMT Server: Apache/1.2b8 Last-Modified: Sun, 23 Nov 1997 13:51:45 GMT ETag: "6bb7-2a1d-347834f1" Content-Length: 10781 Accept-Ranges: bytes Connection: close Content-Type: text/html Novametrix Press Release 19-Nov-97
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Novametrix Announces 2nd Quarter Growth

WALLINGFORD, CT., November 19, 1997 - NOVAMETRIX MEDICAL SYSTEMS INC. (NASDAQ: NMTX) today announced increased revenues and net income for both the second quarter and first six months of Fiscal 1998, on a comparable fully taxed basis.

Net revenues for the second quarter of Fiscal 1998, which ended November 2, 1997 increased by 14% to $7,506,000 compared to net revenues of $6,591,000 reported for the second quarter of the prior fiscal year. Net income for the quarter ended November 2, 1997 increased to $627,000 compared to $393,000 in the prior year and earnings per share increased by 40% to $0.07 per share compared to $0.05 per share, on a comparable fully taxed basis for the second quarter of Fiscal 1997, according to William J. Lacourciere, Chairman, President and Chief Executive Officer.

In fiscal 1998, the Company began reporting on a fully taxed basis for financial reporting purposes and thus is not comparable to the prior year. Last year's reported results included a net tax benefit of $100,000 in each of the first two quarters, from the establishment of a deferred tax asset.

Net revenues for the first six months of Fiscal 1998 also increased by 14% to $14,872,000 compared to $13,013,000 for the comparable period of the prior fiscal year. Net income for the six months ended November 2, 1997 increased to $1,151,000 compared to $755,000 in the prior year and earnings per share increased by 44% to $0.13 per share compared to $0.09 per share for the first half of the year ended October 27, 1996, again on a fully taxed basis as described above, according to Mr. Lacourciere.

Commenting on the results, Mr. Lacourciere stated, "Revenue and earnings for the second quarter and first half of Fiscal 1998 remain strong and on track with the Company's expectations. It is noteworthy that earnings growth rates of 40% continue while the Company has recognized an increase in fully diluted outstanding shares of 10% from 8.3 million shares to 9.2 million shares compared to the first six months of last year. No appreciable changes in outstanding shares for earnings calculations are expected for the remainder of the fiscal year. We are also pleased to have eliminated all bank debt through positive cash flow and the conversion of some of the Company's "A" Warrants. Novametrix's balance sheet is the strongest in its history."

He continued, "We continue to invest heavily in R&D and as reported earlier, Novametrix was named one of Connecticut's fifty fastest growing technology companies. Our current investment in a new technology, Non-Invasive Cardiac Output, also remains on track with positive test results reported from both animal and human clinical trials. Human clinical trials will be expanded over the next several months."

NOVAMETRIX MEDICAL SYSTEMS INC. is a leading designer, developer, manufacturer and marketer of medical electronic instruments and sensors which non-invasively and continuously assess a critically ill patient's oxygen, carbon dioxide and respiratory mechanics. The Company's products are primarily used in operating rooms, intensive care units, respiratory care departments, emergency rooms and for patient transport.

- See Chart Below -

This press release contains forward-looking statements that are based on management's estimates, assumptions and projections. Important factors that could cause results to differ materially from those expected by management include (a) the risk of rapid technological changes and advances including the development of new technologies which could make the Company's existing products technologically or economically obsolete, (b) challenges to the validity of patents held by the Company or claims that the Company's technology infringes other patents, (c) extreme competition in the electronic medical instrumentation industry including competition from companies with greater financial resources than the Company, (d) more stringent government regulation of medical device manufacturers and (e) consolidation in the hospital industry and the establishment of purchasing organizations among groups of hospitals, which could result in reduced demand or reduction in the rate of growth of demand for the Company's products and in reduced profit margins. No assurance can be provided as to actual future financial results.

For further information, please contact:
William J. Lacourciere, President & CEO
Novametrix Medical Systems 203-265-7701


                            NOVAMETRIX MEDICAL SYSTEMS INC.
                           Consolidated Statements of Income
                                    (Unaudited)
                                      (000's)
   
   
                                            Quarter Ended           Six Months Ended
                                        11/2/97     10/27/96      11/2/97     10/27/96
                                       ********     ********      *******     ********
Revenue                                  $7,506       $6,591      $14,872      $13,013
Cost and Expenses:
  Cost of Products Sold                   3,278        2,841        6,393        5,579
  Research and Product Development          851          843        1,711        1,642
  Selling, General and Administrative     2,496        2,263        5,034        4,541
  Interest                                   20           47          104           99
  Other                                      23            1           32            8
                                        -------      -------      -------      -------
                                          6,668        5,995       13,274       11,869
  
INCOME BEFORE INCOME TAXES                  838          596*       1,598        1,144*
  
Income Taxes                                211         (100)*        447         (200)*
                                        -------      -------      -------      -------
NET INCOME                                 $627         $696*      $1,151       $1,344*
                                        =======      =======      =======      =======
  
Net Income Per Common Share
  Primary                                 $0.07        $0.09*       $0.13        $0.17*
  Fully Diluted                            0.07         0.08*        0.13         0.16
    
Net Income Per Common Share - Fully Taxed
  Primary                                 $0.07        $0.05        $0.13        $0.09
  Fully Diluted                            0.07         0.05         0.13         0.09
    
Weighted Average Shares of 
Common Stock Outstanding
  Primary                             9,082,105    8,153,379    8,660,543    7,980,756
  Fully Diluted                       9,304,236    8,359,407    9,171,078    8,328,146
   

* - On a comparable fully taxed basis, $203,000 of income taxes would have been recorded in the second quarter of Fiscal 1997 resulting in a net income of $393,000 or $0.05 per basic share and $389,000 of income taxes would have been recorded for the six months ended October 27, 1996 resulting in net income of $755,000 or $0.09 per share.