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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-QSB
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    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITES EXCHANGE ACT OF 1934
 For the quarterly period ended December 31, 2007
 o
    
    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
  LIBERATOR MEDICAL HOLDINGS, INC.
 
  NEVADA
    
    87-0267292(State or other jurisdiction of 
incorporation or organization)
    
    (IRS Employer Identification No.)
 2979 SE Gran Park Way, Stuart, Florida 34997
 
  (772) 287-2414
 
   x o
  o x
 APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
  o o
 APPLICABLE ONLY TO CORPORATE ISSUERS
  Class
    
    Outstanding as of February 4, 2008Common Stock, $.001
    
    31,829,366
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TABLE OF CONTENTS
 PART I  FINANCIAL INFORMATIONItem 1. Financial StatementsCondensed Consolidated Balance Sheet
    
    
    3Condensed Consolidated Statements of Operations
    
    
    4Condensed Consolidated Statement of Changes in Stockholders Equity
    
    
    5Condensed Consolidated Statements of Cash Flows
    
    
    6Notes to Condensed Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis or Plan of Operation
    
    
    11Item 3. Controls and Procedures
    
    
    15PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    16Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    16Item 3. Defaults Upon Senior Securities
    
    
    16Item 4. Submission of Matters to a Vote of Security Holders
    
    
    16Item 5. Other Information
    
    
    16Item 6. Exhibits
    
    
    16SIGNATURES
    
    
    17
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PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 
 Liberator Medical Holdings, Inc. and Subsidiaries
Condensed Consolidated Balance Sheet
December 31, 2007
(Unaudited)
 AssetsCurrent AssetsCash
    
    $
    59,199Accounts receivable, net of allowance for doubtful
accounts of $383,811
    
    
    794,895Prepaid and other expenses
    
    
    897,307Inventory, net of allowance for obsolete inventory
of $50,000
    
    
    298,326Deferred advertising, current portion
    
    
    173,723Total Current Assets
    
    
    2,223,450Property and EquipmentProperty and Equipment, net of accumulated
depreciation of $547,110
    
    
    778,220Other AssetsDeferred advertising, net of current portion
    
    
    228,256Deposits
    
    
    83,121Total Other Assets
    
    
    311,377Total Assets
    
    $
    3,313,047Liabilities and Stockholders EquityCurrent LiabilitiesAccounts payable
    
    $
    556,774Accrued liabilities
    
    
    194,949Stockholder loan
    
    
    1,664,649Notes payable, current portion
    
    
    217,888Capital lease obligations, current portion
    
    
    33,663Deferred rent liability, current portion
    
    
    44,528Total Current Liabilities
    
    
    2,712,451Long-Term LiabilitiesLong-Term Debt and Capital Lease Obligations, net of
current portion
    
    
    55,949Deferred rent liability, net of current portion
    
    
    249,070Total Long-Term Liabilities
    
    
    305,019Total Liabilities
    
    
    3,017,470Stockholders EquityCommon stock, $.001 par value, 200,000,000 shares
authorized,
31,816,866 shares issued and outstanding
    
    
    31,817Additional paid-in capital
    
    
    10,028,457Accumulated deficit
    
    
    (9,764,697
    )Total Stockholders Equity
    
    
    295,577Total Liabilities and Stockholders Equity
    
    $
    3,313,047
  3




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Liberator Medical Holdings, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
For the three months ended December 31, 2007 and 2006
(Unaudited)
 2007
    
    
    2006Sales
    
    $
    1,429,465
    
    
    $
    708,246Cost of Sales
    
    
    521,625
    
    
    
    376,803Gross Profit
    
    
    907,840
    
    
    
    331,443General and Administrative ExpensesPayroll, taxes and benefits
    
    
    567,485
    
    
    
    570,797Advertising
    
    
    67,666
    
    
    
    39,598Insurance
    
    
    9,147
    
    
    
    8,526Interest
    
    
    51,258
    
    
    
    117,369Rent
    
    
    97,765
    
    
    
    83,730Professional fees
    
    
    178,185
    
    
    
    66,895Bad debts
    
    
    154,917
    
    
    
    78,630Depreciation
    
    
    45,900
    
    
    
    47,173Administrative
    
    
    314,692
    
    
    
    96,412Total General and Administrative Expenses
    
    
    1,487,015
    
    
    
    1,109,130Loss from Operations
    
    
    (579,175
    )
    
    
    (777,687
    )Other Income (Expense)Loss on Sale of Assets
    
    
    
    
    
    
    (12,777
    )Total Other Income (Expense)
    
    
    
    
    
    
    (12,777
    )Loss before Income Taxes
    
    
    (579,175
    )
    
    
    (790,464
    )Provision for Income Taxes
    
    
    
    
    
    
    -Net Loss
    
    $
    (579,175
    )
    
    $
    (790,464
    )Basic and diluted loss per common share
    
    $
    (0.02
    )
    
    $
    (0.03
    )Weighted average basic and dilluted common
shares outstanding
    
    
    31,305,895
    
    
    
    25,447,956
  4




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Liberator Medical Holdings, Inc. and Subsidiaries
Condensed Consolidated Statements of Changes in Stockholders Equity
For the three months ended December 31, 2007
(Unaudited)
 Par $.001
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    TotalCommon
    
    
    Common
    
    
    Paid in
    
    
    Accumulated
    
    
    Stockholders'Shares
    
    
    Stock
    
    
    Capital
    
    
    Deficit
    
    
    EquityBalance at September 30,
2007
    
    
    30,464,014
    
    
    $
    30,464
    
    
    $
    9,092,858
    
    
    $
    (9,185,522
    )
    
    $
    (62,200
    )Shares issued for cash
    
    
    1,052,852
    
    
    
    1,053
    
    
    
    671,647
    
    
    
    
    
    
    
    672,700Warrants issued for services
    
    
    
    
    
    
    
    
    
    
    24,252
    
    
    
    
    
    
    
    24,252Shares issued for services
    
    
    300,000
    
    
    
    300
    
    
    
    239,700
    
    
    
    
    
    
    
    240,000Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (579,175
    )
    
    
    (579,175
    )Balance at December 31, 2007
    
    
    31,816,866
    
    
    $
    31,817
    
    
    $
    10,028,457
    
    
    $
    (9,764,697
    )
    
    $
    295,577
  5




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Liberator Medical Holdings, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
For the three months ended December 31, 2007 and 2006
(Unaudited)
 2007
    
    
    2006Cash flow from operating activities:Net Loss
    
    $
    (579,175
    )
    
    $
    (790,464
    )Adjustments to reconcile net loss to net cash used in
operating activities:Depreciation and amortization
    
    
    45,900
    
    
    
    47,173Equity based compensation
    
    
    264,252
    
    
    
    44,800Bad debt expense
    
    
    154,917
    
    
    
    78,630Loss on abandonment of leasehold improvements
    
    
    
    
    
    
    12,777Changes in operating assets and liabilties:Net accounts receivable
    
    
    (465,949
    )
    
    
    209,441Prepaid expenses
    
    
    (94,562
    )
    
    
    25Deposits
    
    
    (2,135
    )
    
    
    (3,049
    )Inventory
    
    
    528
    
    
    
    49,054Accounts payable
    
    
    157,165
    
    
    
    (50,742
    )Accrued expenses
    
    
    (8,674
    )
    
    
    38,299Deferred rent
    
    
    (10,495
    )
    
    
    14,096Deferred advertising
    
    
    (89,365
    )
    
    
    5,036Net Cash Flows Used in Operating Activities
    
    
    (627,593
    )
    
    
    (344,924
    )Cash flows from investing activities:Purchase of property and equipment
    
    
    (96,122
    )
    
    
    (126,047
    )Net Cash Flows Used in Investing Activities
    
    
    (96,122
    )
    
    
    (126,047
    )Cash flows from financing activities:Proceeds from sale of stock
    
    
    672,700
    
    
    
    37,400Proceeds from notes payable
    
    
    
    
    
    
    504,854Payments of long-term debt and capital lease obligations
    
    
    (66,605
    )
    
    
    (9,537
    )Net Cash Flows Provided by Financing Activities
    
    
    606,095
    
    
    
    532,717Net (decrease) increase in cash
    
    
    (117,620
    )
    
    
    61,746Cash at beginning of period
    
    
    176,819
    
    
    
    80,955Cash at end of period
    
    $
    59,199
    
    
    $
    142,701Supplemental disclosure of cash flow information:Cash paid for interest
    
    $
    51,258
    
    
    $
    117,369
  6




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Liberator Medical Holdings, Inc. and Subsidiaries
Notes To The Condensed Consolidated Financial Statements
December 31, 2007
 Note 1  Condensed Consolidated Financial Statements
   Note 2  Summary of Significant Accounting Policies
 Inventories
  Income Taxes
    Note 3  Recent Accounting Pronouncements
 , The Fair Value Option for Financial Assets and
Financial Liabilities  Including an amendment of FASB Statement No. 115.
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Liberator Medical Holdings, Inc. and Subsidiaries
Notes To The Condensed Consolidated Financial Statements
December 31, 2007
 SFAS Fair Value Measures.
  Business Combinations
 Noncontrolling Interests in Consolidated
Financial Statementsan amendment of ARB No. 51 (FASB No. 160)
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Liberator Medical Holdings, Inc. and Subsidiaries
Notes To The Condensed Consolidated Financial Statements
December 31, 2007
 Note 4  Going Concern
  Note 5  Warrants and Options
 Warrants
  AmountBalance at September 30, 2007
    
    
    3,084,342Issued in FY 2008
    
    
    495,417Exercised in FY 2008
    
    
    0Expired in FY 2008
    
    
    0Balance at December 31, 2007
    
    
    3,579,759
  Options
  Note 6  Sale of Common Stock
  9




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Liberator Medical Holdings, Inc. and Subsidiaries
Notes To The Condensed Consolidated Financial Statements
December 31, 2007
 Note 7  Diluted Loss per Common Share
  Note 8  Income Taxes
   December 31, 2007Loss carry forward for tax purposes
    
    $
    5,650,000Deferred tax asset (35%)
    
    
    1,978,000Valuation allowance
    
    
    (1,978,000
    )Net deferred tax asset
    
    $
    0
 Note 9  Commitments
  AmountYear ending December 31:2008
    
    $
    246,9222009
    
    
    273,8662010
    
    
    251,6802011
    
    
    264,2602012
    
    
    229,300$
    1,348,335
  10




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Item 2. Managements Discussion and Analysis or Plan of Operation.
 This Managements Discussion and Analysis or Plan of Operation and other parts of this quarterly
report on Form 10-QSB contain forward-looking statements that involve risks and uncertainties.
Forward-looking statements can also be identified by words such as intends, anticipates,
expects, believes, plans, predicts, and similar terms. Forward-looking statements are not
guarantees of future performance and our actual results may differ significantly from the results
discussed in the forward-looking statements. Factors that might cause such differences include, but
are not limited to, those set forth below under Certain Risk Factors. The following discussion
should be read in conjunction with our unaudited consolidated financial statements and notes
thereto included in this Form 10-QSB and the audited financial statements of Liberator Medical
Holdings, Inc. (LMH), included in our current report on Form 10-KSB dated January 18, 2008, filed
with the Securities and Exchange Commission and managements discussion and analysis contained
therein. We assume no obligation to revise or update any forward-looking statements for any reason,
except as required by law.
 Overview
    Results of Operations
   11




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Liquidity and Capital Resources
    Financing Activities
  Outlook
   12




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
    
    Obtain additional funding through a combination of debt and equity;
    
    Increase advertising over the prior periods;
    
    Increase our customer base;
    
    Continue to service our current customer base and increase the retention rate;
    
    Increase the collections of our accounts receivable.
  
    
    Identified products and related target customers through extensive market research.
    
    Established efficient and cost effective methods to reach qualified customers.
    
    Established an infrastructure of management and knowledgeable staff to support
substantial growth in sales with a minimal amount of additional staff members.
    
    Leased a 25,000 square foot facility which has only been built out 50 percent to
accommodate our current operations including room for growth. The other 50 percent will be
built out in stages as additional growth requires the additional office space.
    
    Created a HIPPA compliant IT infrastructure and staff to accommodate additional growth
in sales.
    
    Established a marketing plan that can be monitored for effectiveness and is flexible
enough to adjust to changing market conditions.
    
    Tested our advertising methods and established methods of testing additional advertising
methods to meet with changing market conditions.
    Contractual Commitments
  Off-Balance Sheet Arrangements
  Certain Risk Factors
  13




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
    
    We have incurred significant net losses every year since the inception of
LMS.
    
    The Company has aggressive marketing plans that require the Company to spend
substantial sums. The Company will need additional capital to continue its business plan.
    
    Our future operating results remain difficult to predict.
    
    Sales of a significant portion of our products depend on the continued
availability of reimbursement of our customers by government and private insurance plans.
    
    Our ability to operate at a profit is highly dependent on recurring orders
from customers, as to which there is no assurance.
    
    We may not be able to market our new diabetes products or otherwise to
operate our diabetes supply business segment at a profit because of marketing costs, competition,
or other reasons not now foreseen.
    
    We could be liable for harm caused by products that we sell.
    
    Competition from other sellers of products sold by us is intense and
expected to increase.
    
    If we or our suppliers do not comply with applicable government regulations,
we may be prohibited from selling our products.
    
    We may make acquisitions that will strain our financial and operational resources.
  Critical Accounting Policies
  14




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Effect of Inflation
  Qualitative and Quantitative Disclosure about Market Risk
  
 Item 3. Controls and Procedures.
 Evaluation of Disclosure Controls and Procedures
    Change in Internal Controls
  15




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PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. Exhibits
 
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SIGNATURES
  LIBERATOR MEDICAL HOLDINGS, INC.Registrant/s/ Mark A. Libratore
    
    President
    
    February 14, 2008Mark A. Libratore/s/ Robert J. Davis
    
    Chief Financial Officer
    
    February 14, 2008Robert J. Davis
 17