Artaflex with sales increase in 1Q/2013

For the quarter, sales to the Company's four largest customers represented an aggregate of 54% (2012 - 72%) of the Company's total sales. Gross profit decreased $195, to $881 compared to $1,076 in the same period of 2012. Gross profit as a percentage of sales was 13.5% compared to 29.6% for the same period in 2012. The decrease in gross profit and percentage in the quarter is largely due to the acquisition of Adeptron which historically had a lower gross profit. Selling, general and administrative ("SG&A) expense increased 86.0% to $1,408 compared to $757 for the same quarter in 2012. The increase was primarily due to one-time legal and professional costs associated with the terminated acquisition of MTI International, Inc. SG&A expense as a percentage of sales was 21.6%, comparable to 20.8% in 2012. The net loss and comprehensive loss was $906 compared to a net income of $467 in the first quarter of 2012. Adjusted EBITDA loss was $312 compared to an adjusted EBITDA income of $467 in the same period last year. EBITDA means earnings before interest, taxes, depreciation and amortization.