##### 



Contact:
    
    Daniel C. DunnChief Financial Officer314/771-2400
 Allied Healthcare Reports Flat Second Quarter Net
Income
With Higher Material Costs Eroding Profits
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 24




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Three months ended,
    
    
    Six months ended,December 31,
    
    
    December 31,2006
    
    
    2005
    
    
    2006
    
    
    2005Net sales
    
    $
    14,273,950
    
    
    $
    13,339,789
    
    
    $
    28,751,392
    
    
    $
    28,326,070Cost of sales
    
    
    10,757,222
    
    
    
    9,766,848
    
    
    
    21,715,111
    
    
    
    20,778,612Gross profit
    
    
    3,516,728
    
    
    
    3,572,941
    
    
    
    7,036,281
    
    
    
    7,547,458Selling General and
administrative expenses
    
    
    3,091,418
    
    
    
    3,032,153
    
    
    
    6,282,415
    
    
    
    6,202,112Income from operations
    
    
    425,310
    
    
    
    540,788
    
    
    
    753,866
    
    
    
    1,345,346Interest income
    
    
    (28,059
    )
    
    
    (18,718
    )
    
    
    (56,228
    )
    
    
    (26,675
    )Other, net
    
    
    (53,182
    )
    
    
    8,924
    
    
    
    (43,878
    )
    
    
    19,993(81,241
    )
    
    
    (9,794
    )
    
    
    (100,106
    )
    
    
    (6,682
    )Income before provision
for income taxes
    
    
    506,551
    
    
    
    550,582
    
    
    
    853,972
    
    
    
    1,352,028Provision for income taxes
    
    
    213,395
    
    
    
    233,328
    
    
    
    359,183
    
    
    
    568,933Net income
    
    $
    293,156
    
    
    $
    317,254
    
    
    $
    494,789
    
    
    $
    783,095Net income per share  Basic
and diluted
    
    $
    0.04
    
    
    $
    0.04
    
    
    $
    0.06
    
    
    $
    0.10Weighted average common shares
Outstanding  Basic
    
    
    7,877,120
    
    
    
    7,832,186
    
    
    
    7,868,512
    
    
    
    7,830,881Weighted average common shares
Outstanding  Diluted
    
    
    8,059,573
    
    
    
    8,050,069
    
    
    
    8,064,650
    
    
    
    8,041,758
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December 31, 2006
    
    
    June 30, 2006ASSETSCurrent assets:Cash and cash equivalents
    
    $
    2,842,638
    
    
    $
    2,696,324Accounts receivable, net of allowances
of $400,000 and $430,000, respectively
    
    
    7,357,596
    
    
    
    7,429,355Inventories, net
    
    
    12,187,592
    
    
    
    11,491,305Other current assets
    
    
    498,154
    
    
    
    224,853Total current assets
    
    
    22,885,980
    
    
    
    21,841,837Property, plant and equipment, net
    
    
    10,902,795
    
    
    
    11,252,934Goodwill
    
    
    15,979,830
    
    
    
    15,979,830Other assets, net
    
    
    253,222
    
    
    
    255,845Total assets
    
    $
    50,021,827
    
    
    $
    49,330,446LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    3,666,116
    
    
    $
    3,208,699Deferred income taxes
    
    
    677,188
    
    
    
    689,942Deferred revenue
    
    
    465,000
    
    
    
    465,000Other accrued liabilities
    
    
    2,670,374
    
    
    
    2,834,495Total current liabilities
    
    
    7,478,678
    
    
    
    7,198,136Deferred revenue
    
    
    1,240,000
    
    
    
    1,472,500Commitments and contingenciesStockholders equity:Preferred stock; $0.01 par value; 1,500,000 shares
authorized; no shares issued and outstanding
    
    
    
    
    
    
    Series A preferred stock; $0.01 par value; 200,000 shares
authorized; no shares issued and outstanding
    
    
    
    
    
    
    Common stock; $0.01 par value; 30,000,000 shares
authorized; 10,187,069 shares issued at December 31, 2006
and 10,155,569 shares issued at June 30, 2006; 7,883,577
outstanding at December 31, 2006 and 7,852,077
shares outstanding June 30, 2006, respectively
    
    
    101,871
    
    
    
    101,556Additional paid-in capital
    
    
    47,406,417
    
    
    
    47,258,182Retained earnings
    
    
    14,526,289
    
    
    
    14,031,500Less treasury stock, at cost; 2,303,492 shares at
December 31, 2006 and June 30, 2006, respectively
    
    
    (20,731,428
    )
    
    
    (20,731,428
    )Total stockholders equity
    
    
    41,303,149
    
    
    
    40,659,810Total liabilities and stockholders equity
    
    $
    50,021,827
    
    
    $
    49,330,446
 26