Digirad Corporation Reports Financial Results for 2007 Fourth Quarter and Twe...( Net Results Improve for Year on Hig...)

Net Results Improve for Year on Higher Services Revenues, Lower Expenses

POWAY, Calif., Feb. 7 /PRNewswire-FirstCall/ -- Digirad Corporation (Nasdaq: DRAD), a leading provider of medical diagnostic imaging systems and services to physicians' offices, hospitals and imaging centers, today reported narrower losses for the twelve months ended December 31, 2007, on higher annual revenues and lower operating expenses for the year.

Consolidated revenues for the quarter were $18.8 million, up nine percent from $17.2 million in fourth-quarter 2006. Revenue from its mobile imaging services division or DIS rose 16 percent to $13.4 million from $11.6 million in fourth-quarter 2006. Product-related revenue was $5.4 million, and included sales of 18 cameras, compared to $5.6 million in fourth-quarter 2006, including sales of 17 cameras.

Consolidated revenues for full-year 2007 were $73.9 million, compared to $71.9 million in 2006. DIS revenue was $52.4 million, compared to $49.6 million for 2006. Product-related revenue was $21.5 million, including sales of 73 cameras, compared to $22.3 million in 2006, which included sales of 71 cameras.

Chief Executive Officer Mark Casner commented: "We are pleased with our achievements in 2007: our acquisition of Ultrascan, the launch of our Centers of Influence strategy, the improvement in our product margins, and the reduction of our operating loss by $5.4 million compared to 2006."

Consolidated gross profit decreased by nine percent to $4.5 million for the quarter, principally due to decreased DIS profitability attributable to greater than normal seasonality and the disruption in radioisotope supplies announced previously. Gross margin was 24 percent of revenues in the fourth quar
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