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Huiheng Medical, Inc. Reports Record Financial Results for Fiscal Year 2007 and Financial Results for Q1 2008
Date:5/16/2008

2.24 million, an increase of $9.39 million or 329% compared to our revenue backlog from product sales of approximately $2.85 million for as of March 31, 2007.

The increase in our product sales backlog in the first quarter of 2008 was due to a high demand for products as well as installation delays in the first quarter of 2008 due to the snowstorms and bad weather over that period. The backlog orders are not cancellable and the Company expects that all of them will be filled in 2008.

Cost of revenues

For the three months ended March 31, 2008 the total cost of revenues amounted to $34,280, a decrease by approximately $1.08 million, compared to roughly $1.12 million for the same period of the prior year. This decrease was due to all the revenues for the period being generated from service contracts and from tax refunds and subsidies, which have minimal associated direct costs.

Operating expenses

Sales and marketing expenses. Sales and marketing expenses were $21,888 for the three months ended March 31, 2008, an increase of 79% or roughly $9,626, compared to $12,262 for the same period of the prior year. This increase in sales and marketing expenses resulted from increased sales and marketing activity and increased sales of our radiotherapy units over the period.

General and administrative expenses. General and administrative expenses amounted to $405,765 for the three months ended March 31, 2008, representing an increase of roughly $84,188, or 26%, compared to $321,577 for the same period of the prior year. The increase in general and administrative expenses resulted from an increase in the number of employees that were hired since the end of the first quarter of 2007 to facilitate and manage our rapid growth.

Research and development expenses. Research and development expenses were presented on the statement of income as $96,520 for the three months ended March 31, 2008, an increase of $65,235 or 209% compared to $31,28
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SOURCE Huiheng Medical, Inc.
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