MTS Updates Status of Certain Business Activities in Conjunction with Annual Meeting

2008-09-23 23:53:03 -

www.mts-mt.com - MTS Medication Technologies, Inc. Corporate Contact: Michael P. Conroy, CFO, 727-576-6311, Ext. 464 Fax: 727-573-1100 ir@mts-mt.com or Investor Relations: Porter, LeVay & Rose, Inc. Michael Porter, Investor Relations, 212-564-4700 Fax: 212-244-3075 plrmail@plrinvest.com MTS Medication Technologies, Inc. ("MTS") (NasdaqCM:MTSI) will hold its Annual Stockholders meeting today at its executive offices in St. Petersburg, Florida. At the Annual Meeting, the

Company will update its stockholders as to progress with its OnDemand contract and improvements in gross margins associated with consumables.

MTS has made continued progress towards the completion of an OnDemand machine contract with its largest customer, Omnicare, Inc. In the second quarter, four OnDemand Express II machines and four AccuFlex machines have been accepted by the customer, bringing the total to 15 accepted systems to date. Of the 24 systems contracted, 19 have been installed, and the Company expects four of the five remaining systems to be installed by the end of the calendar year with the last system delivered in early January 2009.

In addition, the Company will report that it is pleased with improvements in the gross margin of its consumable products. Although increased costs due to higher freight and plastic raw material had negatively impacted the Company's gross margin in the first fiscal quarter, measures have now been put into place to address the margin erosion and the Company believes improvements are being made in this area.

Todd Siegel, President and Chief Executive Officer, stated, "We are pleased with the progress made on the installation, implementation and acceptance of the OnDemand Express II machines at our largest customer. This process is becoming more routine, and our efficiencies improve with each new site putting us on target to complete the contract before the fiscal year end. More importantly, the systems are performing to our expectations and those of our customer's with production rates that exceed contractual requirements."

Siegel continued, "We believe our ability to control costs and manage pricing for consumable products will provide us with improved operating margins as we progress through this fiscal year despite a difficult global economy."

"As a result of progress in the above mentioned areas, we are in a position to reaffirm our outlook for the financial performance of the Company for fiscal year 2009. We expect revenue will range between $75 and $78 million and fully diluted earnings per share to be in the range of $0.35 to $0.40."

About MTS

Founded in 1984, MTS Medication Technologies (www.mts-mt.com) is an international provider of medication adherence packaging systems designed to improve medication dispensing and administration. MTS manufactures automated packaging machines and related consumables for prescription medications and nutritional supplements. The Company serves approximately 8,000 pharmacies worldwide.

This press release contains forward-looking statements within the meaning of that term in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Additional written or oral forward-looking statements may be made by the Company from time to time, in filings with the Securities and Exchange Commission or otherwise. Statements contained herein that are not historical facts are forward-looking statements made pursuant to the safe harbor provisions described above. Forward-looking statements may include, but are not limited to, projections of revenue, income or losses, the value of contracts, capital expenditures, plans for future operations, the elimination of losses under certain programs, financing needs or plans, compliance with financial covenants in loan agreements, plans for sale of assets or businesses, plans relating to products or services of the Company, assessments of materiality, predictions of future events and the effects of pending and possible litigation, as well as assumptions relating to the foregoing. In addition, when used in this discussion, the words "anticipates", "estimates", "expects", "intends", "plans" and variations thereof and similar expressions are intended to identify forward-looking statements. In particular, all statements regarding the future acceptance of OnDemand machines are forward-looking statements.

Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified based on current expectations. Consequently, future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements contained herein. Statements in the Press Release describe factors, among others, that could contribute to or cause such differences. Other factors that could contribute to or cause such /differences include, but are not limited to, unanticipated increases in operating costs, labor disputes, customer rejection of any installed OnDemand machine, capital requirements, increases in borrowing costs, product demand, pricing, market acceptance, hurricanes and other natural disasters, intellectual property rights and litigation, risks in product and technology development and other risk factors detailed in the Company's Securities and Exchange Commission filings.

Readers are cautioned not to place undue reliance on any forward-looking statements contained herein, which speak only as of the date hereof. The Company undertakes no obligation to publicly release the result of any revisions of these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unexpected events.

Reaffirms Financial Guidance