Net Income Increased 239% to $3.8 Million; Adjusted EBITDA Increased 205% to $5.8 Million on Record Revenue

PLAINVIEW, NY / ACCESSWIRE / March 29, 2016 / Vasomedical, Inc. (“Vasomedical”) (OTC PK: VASO) today reported its operating results for the three months and year ended December 31, 2015.

“With a 63% year-over-year growth in annual revenue to a record $57.1 million, including revenue of $20.7 million from seven months of NetWolves operations, we are excited to report a net income of $3.8 million for fiscal year 2015, an increase of 239% from $1.1 million reported for the prior year,” stated Dr. Jun Ma, President and Chief Executive Officer of Vasomedical, Inc. “Our VasoHealthcare subsidiary continued to be a successful and most significant contributor to our financial results in 2015, and our VasoTechnology division began to play an important role in our total revenue during the year, while performance in our proprietary equipment business also improved for 2015, especially in the international market. Further, our operations generated positive cash flow of $6.5 million in 2015, substantially strengthening the Company’s financial position with cash balances of approximately $5 million as of March 25, 2016.”

“The year 2015 represented another milestone as we not only saw great growth in the top- and bottom-line numbers, we have also built our Company into a robust enterprise with a diversified revenue stream, with approximately 44%, 50% and 6% of revenue in 2015 from our professional sales services, IT and equipment segments, respectively, on an annualized basis. We expect continued revenue growth and profitability in 2016 as our growth strategy continues to show positive results. We remain optimistic of the outlook for NetWolves and the value added reseller business for the GEHC IT solutions, and look forward to significant progress in this IT segment,” concluded Dr. Ma.

Financial Results for Three Months Ended December 31, 2015

For the three months ended December 31, 2015, revenue increased 73.1% to $21.4 million from $12.4 million for the same period of 2014. This is primarily attributable to the inclusion of $9.2 million of revenue from the NetWolves operations in the fourth quarter 2015, offset by a small decrease in revenues from our professional sales services and equipment segments.

Gross profit for the fourth quarter of 2015 increased 37.6% to $12.6 million, compared with a gross profit of $9.2 million for the fourth quarter of 2014. This increase is primarily a result of revenue from our NetWolves subsidiary as noted above, offset by a decrease in gross profit in our equipment segment.

Selling, general and administrative (SG&A) expenses for the fourth quarter of 2015 increased 52.6% to $9.9 million compared to $6.5 million for the fourth quarter of 2014. The increase is primarily attributable to including SG&A costs from the NetWolves operations, offset by a decrease in expenses in our professional sales services and equipment segments. SG&A expenses were 46.1% of revenue in the fourth quarter 2015 compared to 52.3% of revenue for the same quarter of 2014.

Net income for the three months ended December 31, 2015 was $2.7 million, compared with a net income of $2.5 million for the three months ended December 31, 2014.

Financial Results for Year Ended December 31, 2015

For the year ended December 31, 2015, revenue increased $22.1 million, or 63.3%, to $57.1 million, compared with $35.0 million for the year 2014. Commission revenues in our professional sales services segment increased by 4.5% to $31.6 million for the year 2015, as compared with $30.2 million for the prior year. The increase was due primarily to higher installations of underlying equipment by GEHC in 2015, offset by lower commission rates for the equipment installed in 2015. Revenue in our IT segment was $21.1 million for the year ended December 31, 2015, compared to revenue of $48 thousand in 2014, mainly as a result of including $20.7 million of revenue from NetWolves in 2015. Equipment segment revenue for the year 2015 decreased by 7% to $4.3 million, compared to $4.7 million in 2014, principally due to a decrease in volume from EECP® sales.

Gross profit for the year ended December 31, 2015 increased 40.4% to $35.4 million, from $25.2 million in 2014. This increase is due primarily to $8.5 million of gross profit from NetWolves and to higher revenue in the professional sales services segment as noted above.

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