LMS Third Quarter 2008 Financial Results - Q3 Revenue Increases 88% to $1.0 Million - YTD Revenue Increases 87% to $2...( MONTREAL Feb. 12 / LMS Medical Sy...),Health

MONTREAL, Feb. 12 /PRNewswire-FirstCall/ - LMS Medical Systems (TSX: LMZ, AMEX: LMZ), a healthcare technology company and developer of the CALM(R)clinical information system and risk management software tools for obstetrics, today reported its unaudited financial results for the third quarter ended December 31, 2007. All amounts are in Canadian dollars.

On the strength of new installations and growing recurring maintenance and technical service revenues, our comparative quarterly revenues for Q3 2008 grew 88% to $952,000 from $506,000 in Q3 2007. As a result of the growth in our installed client base, our recurring maintenance and service revenues increased by 46% to $1,058,000 from $726,000 for the comparative nine-month period. For the third quarter, these revenues increased 70% to $355,000 from $209,000.

Following the implementation of a program to streamline operations during Q3 2008, operating expenses were reduced by $906,000 for the third quarter of fiscal 2008, from $2,991,000 for Q3 2007 to $2,085,000 for Q3 2008, and by $1,389,000 for year-to-date, from $8,768,000 for the nine months ended December 31, 2006 to $7,379,000 for the nine months ended December 31, 2007. The reduction for Q3 2008 is explained mainly by a decrease in research and development expenses of $405,000, lower selling marketing product management expenses of $193,000 and lower administrative expenses of $272,000. Included in operating expenses are non-cash, stock-based compensation expenses of $305,000 for Q3 2008 and $870,000 on a year-to-date basis.

The combination of the increase in revenues of $446,000 and lower overall expenses of $906,000 reduced the comparative operating loss by $1,297,000 from $2,563,000 ($0.14 per share) in Q3 2007 to $1,266,000 ($0.06 per share) in Q3 2008, and decreased the cash used in operating activities before net changes in non-operating working capital items by $1,211,000 to $935,000 for Q3 2008 compared to $2,146,000 for Q3 2
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