Escalon(R) Reports Second Quarter Fiscal 20...( Company Reports Improved Second Qua...)

Company Reports Improved Second Quarter Product Revenue and Continues to

Broaden Product Portfolio

WAYNE, Pa., Feb. 14 /PRNewswire-FirstCall/ -- Escalon Medical Corp. (Nasdaq: ESMC) today announced results for its fiscal second quarter and six months ended December 31, 2007.

For the second quarter of fiscal 2008, the Company reported improved sales in the Company's Drew, Vascular and Escalon Digital Solutions (EMI) business units, which increased approximately 16%, 10% and 36%, respectively, compared with the same period last fiscal year. Product revenue increased approximately $415,000, or 6%, to $7,450,000 during the three-month period ended December 31, 2007, compared with the same period in 2006. The Company reported net revenue of $7,495,080, a 1.8% decrease from the $7,636,740 reported in the prior year period. This decline was primarily due to decreased royalties received from the IntraLase License Agreement as a result of the settlement agreement between the Company and IntraLase dated February 27, 2007. These decreases were offset by the sales increases at Drew, Vascular and EMI mentioned above.

For the second quarter of fiscal 2008, the Company reported a net loss of $(639,346), or $(0.10) per diluted share, compared with a net loss of $(470,103), or $(0.07) per diluted share, in the second quarter of fiscal 2007. This was attributable to decreased royalties received from the IntraLase License Agreement, as well as increased expenses for the ongoing development of new products. Cost of goods sold totaled approximately $3,951,000, or 53% of product revenue, for the three-month period ended December 31, 2007, compared with $3,878,000, or 55% of product revenue, for the same period last
'/>"/>