##### Table of Contents



FORM 10-Q
 SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2011
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number: 1-10986
 MISONIX, INC.
 (Exact name of registrant as specified in its charter)
 New York
    
    11-2148932(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)1938 New Highway, Farmingdale, NY
    
    11735(Address of principal executive offices)
    
    (Zip Code)
 (Registrants telephone number, including area code)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ
  Outstanding atClass of Common Stock
    
    May 10, 2011Common Stock, $.01 par value
    
    7,001,369




---



##### 



MISONIX, INC.
 INDEX
 PagePart I  FINANCIAL INFORMATIONItem 1. Financial Statements:Consolidated Balance Sheets as of March 31, 2011 (Unaudited) and June 30, 2010
    
    
    3Consolidated Statements of Operations Nine months ended March 31, 2011 and 2010 (Unaudited)
    
    
    4Consolidated Statements of Operations Three months ended March 31, 2011 and 2010 (Unaudited)
    
    
    5Consolidated Statement of Stockholders Equity Nine months ended March 31, 2011 (Unaudited)
    
    
    6Consolidated Statements of Cash Flows Nine months ended March 31, 2011 and 2010 (Unaudited)
    
    
    7Notes to Consolidated Financial Statements (Unaudited)
    
    
    8Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    20Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    23Item 4. Controls and Procedures
    
    
    24Part II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    24Item 1A. Risk Factors
    
    
    24Item 6. Exhibits
    
    
    24Signatures
    
    
    25Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
   2




---



##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements.
 MISONIX INC. and Subsidiaries
 
 Consolidated Balance Sheets
 
 March 31,
    
    
    June 30,2011
    
    
    2010(Derived fromAuditedFinancial(Unaudited)
    
    
    Statements)Current Assets:Cash
    
    $
    7,584,475
    
    
    $
    9,900,605Accounts receivable, less allowance for doubtful accounts of $109,070 and $123,346,
respectively
    
    
    1,859,026
    
    
    
    2,335,653Inventories, net
    
    
    3,909,943
    
    
    
    2,699,717Prepaid expenses and other current assets
    
    
    501,622
    
    
    
    515,427Notes receivable
    
    
    210,000
    
    
    
    1,075,105Total current assets
    
    
    14,065,066
    
    
    
    16,526,507Property, plant and equipment, net
    
    
    922,285
    
    
    
    500,215Goodwill
    
    
    1,701,094
    
    
    
    1,701,094Other assets
    
    
    2,189,232
    
    
    
    1,730,339Total assets
    
    $
    18,877,677
    
    
    $
    20,458,155Liabilities and stockholders equityCurrent liabilities:Notes payable
    
    $
    
    
    
    $
    177,679Accounts payable
    
    
    1,293,455
    
    
    
    888,654Accrued expenses and other current liabilities
    
    
    1,132,039
    
    
    
    1,000,523Total current liabilities
    
    
    2,425,494
    
    
    
    2,066,856Capital lease obligations
    
    
    2,666
    
    
    
    14,274Deferred lease liability
    
    
    9,830
    
    
    
    Deferred income
    
    
    192,314
    
    
    
    250,739Total liabilities
    
    
    2,630,304
    
    
    
    2,331,869Commitments and contingenciesStockholders equity:Common stock, $.01 par value-shares authorized 20,000,000; 7,079,169 issued,
and 7,001,369 outstanding
    
    
    70,792
    
    
    
    70,792Additional paid-in capital
    
    
    25,709,294
    
    
    
    25,502,717Accululated deficit
    
    
    (9,120,289
    )
    
    
    (7,034,799
    )Treasury stock, 77,800 shares
    
    
    (412,424
    )
    
    
    (412,424
    )Stockholders equity
    
    
    16,247,373
    
    
    
    18,126,286Total liabilities and stockholders equity
    
    $
    18,877,677
    
    
    $
    20,458,155
 See Accompanying Notes to Consolidated Financial Statements.
  3




---



##### Table of Contents



MISONIX INC. and Subsidiaries
 
 Consolidated Statements of Operations
 (Unaudited)
 For the nine months endedMarch 31,2011
    
    
    2010Net sales
    
    $
    10,274,831
    
    
    $
    9,092,322Cost of goods sold
    
    
    4,877,847
    
    
    
    4,860,539Gross profit
    
    
    5,396,984
    
    
    
    4,231,783Operating expenses:Selling expenses
    
    
    3,098,967
    
    
    
    2,649,699General and administrative expenses
    
    
    3,334,338
    
    
    
    3,824,640Research and development expenses
    
    
    1,303,121
    
    
    
    1,387,133Total operating expenses
    
    
    7,736,426
    
    
    
    7,861,472Loss from operations
    
    
    (2,339,442
    )
    
    
    (3,629,689
    )Other income (expense):Interest income
    
    
    93
    
    
    
    28,178Interest expense
    
    
    (5,494
    )
    
    
    (48,176
    )Royalty income and license fees
    
    
    487,622
    
    
    
    481,417Royalty expense
    
    
    (51,324
    )
    
    
    (83,926
    )Recovery of Focus Surgery, Inc. investment
    
    
    
    
    
    
    693,044Other
    
    
    146,796
    
    
    
    (20,320
    )Total other income
    
    
    577,693
    
    
    
    1,050,217Loss from continuing operations before income taxes
    
    
    (1,761,749
    )
    
    
    (2,579,472
    )Income tax (benefit)
    
    
    46,100
    
    
    
    (976,435
    )Net loss from continuing operations
    
    
    (1,807,849
    )
    
    
    (1,603,037
    )Discontinued operations:Net (loss) income from discontinued operations net of $0
and tax of $358,634
    
    
    (277,641
    )
    
    
    506,367Net loss from sale of discontinued operations net of tax of
$0 and $957,937
    
    
    
    
    
    
    (369,848
    )Noncontrolling interest in discontinued operations, net of income tax
    
    
    
    
    
    
    66,201Total net (loss) income from discontinued operations
    
    
    (277,641
    )
    
    
    202,720Net loss attributable to Misonix, Inc. shareholders
    
    
    (2,085,490
    )
    
    $
    (1,400,317
    )Net loss per share from continuing operations attributable to Misonix, Inc.
shareholders  Basic
    
    $
    (0.26
    )
    
    $
    (0.23
    )Net (loss) income per share from discontinued operations  Basic
    
    
    (0.04
    )
    
    
    0.03Net loss per share attributable to Misonix, Inc. shareholders  Basic
    
    $
    (0.30
    )
    
    $
    (0.20
    )Net loss per share from continuing operations attributable to Misonix, Inc.
shareholders  Diluted
    
    $
    (0.26
    )
    
    $
    (0.23
    )Net (loss) income per share from discontinued operations  Diluted
    
    
    (0.04
    )
    
    
    0.03Net loss per share attributable to Misonix, Inc. shareholders  Diluted
    
    $
    (0.30
    )
    
    $
    (0.20
    )Weighted Average Shares  Basic
    
    
    7,001,369
    
    
    
    7,001,369Weighted Average Shares  Diluted
    
    
    7,001,369
    
    
    
    7,001,369
 See Accompanying Notes to Consolidated Financial Statements.
  4




---



##### Table of Contents



MISONIX INC. and Subsidiaries
 
 Consolidated Statements of Operations
 (Unaudited)
 For the three months endedMarch 31,2011
    
    
    2010Net sales
    
    $
    3,593,154
    
    
    $
    3,313,131Cost of goods sold
    
    
    1,720,037
    
    
    
    1,596,264Gross profit
    
    
    1,873,117
    
    
    
    1,716,867Operating expenses:Selling expenses
    
    
    1,079,267
    
    
    
    671,213General and administrative expenses
    
    
    1,007,051
    
    
    
    1,021,476Research and development expenses
    
    
    414,342
    
    
    
    441,093Total operating expenses
    
    
    2,500,660
    
    
    
    2,133,782Loss from operations
    
    
    (627,543
    )
    
    
    (416,915
    )Other income (expense):Interest income
    
    
    18
    
    
    
    101Interest expense
    
    
    (415
    )
    
    
    (2,517
    )Royalty income and license fees
    
    
    135,920
    
    
    
    172,534Royalty expense
    
    
    (11,065
    )
    
    
    (18,870
    )Recovery of Focus Surgery, Inc. investment
    
    
    
    
    
    
    693,044Other
    
    
    106,963
    
    
    
    (11,609
    )Total other income
    
    
    231,421
    
    
    
    832,683Loss from continuing operations before income taxes
    
    
    (396,122
    )
    
    
    415,768Income tax
    
    
    4,000
    
    
    
    206,242Net (loss) income from continuing operations
    
    
    (400,122
    )
    
    
    209,526Discontinued operations:Net (loss) from discontinued operations net of $0
and a tax benefit of ($111,763)
    
    
    (131,356
    )
    
    
    (258,850
    )Net loss from sale of discontinued operations net of tax of
$0 and $0
    
    
    
    
    
    
    (257,029
    )Noncontrolling interest in discontinued operations, net of income tax
    
    
    
    
    
    
    24,861Total net loss from discontinued operations
    
    
    (131,356
    )
    
    
    (491,018
    )Net loss attributable to Misonix, Inc. shareholders
    
    
    (531,478
    )
    
    $
    (281,492
    )Net (loss) income per share from continuing operations attributable to Misonix, Inc.
shareholders  Basic
    
    $
    (0.06
    )
    
    $
    0.03Net loss per share from discontinued operations  Basic
    
    
    (0.02
    )
    
    
    (0.07
    )Net loss per share attributable to Misonix, Inc. shareholders  Basic
    
    $
    (0.08
    )
    
    $
    (0.04
    )Net (loss) income per share from continuing operations attributable to Misonix, Inc.
shareholders  Diluted
    
    $
    (0.06
    )
    
    $
    0.03Net loss per share from discontinued operations  Diluted
    
    
    (0.02
    )
    
    
    (0.07
    )Net loss per share attributable to Misonix, Inc. shareholders  Diluted
    
    $
    (0.08
    )
    
    $
    (0.04
    )Weighted Average Shares  Basic
    
    
    7,001,369
    
    
    
    7,001,369Weighted Average Shares  Diluted
    
    
    7,001,369
    
    
    
    7,038,385
 See Accompanying Notes to Consolidated Financial Statements.
  5




---



##### Table of Contents



MISONIX, INC and Subsidiaries
 
 Consolidated Statement of Stockholders Equity
 (Unaudited)
 Nine months ended March 31, 2011
 Common Stock$.01 Par Value
    
    
    Treasury Stock
    
    
    Additional
    
    
    
    
    
    
    TotalNumber
    
    
    
    
    
    
    Number
    
    
    
    
    
    
    Paid-in
    
    
    Accumulated
    
    
    Stockholdersof Shares
    
    
    Amount
    
    
    of Shares
    
    
    Amount
    
    
    Capital
    
    
    Deficit
    
    
    EquityBalance, June 30, 2010
    
    
    7,079,169
    
    
    $
    70,792
    
    
    
    (77,800
    )
    
    $
    (412,424
    )
    
    $
    25,502,717
    
    
    $
    (7,034,799
    )
    
    $
    18,126,286Net loss\comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,085,490
    )
    
    
    (2,085,490
    )Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    206,577
    
    
    
    
    
    
    
    206,577Balance, March 31, 2011
    
    
    7,079,169
    
    
    $
    70,792
    
    
    
    (77,800
    )
    
    $
    (412,424
    )
    
    $
    25,709,294
    
    
    $
    (9,120,289
    )
    
    $
    16,247,373
 See Accompanying Notes to Consolidated Financial Statements.
  6




---



##### Table of Contents



MISONIX, INC and Subsidiaries
 
 Consolidated Statements of Cash Flows
 (Unaudited)
 For the nine months endedMarch 31,2011
    
    
    2010Operating activitiesNet loss from continuing operations
    
    $
    (1,807,849
    )
    
    $
    (1,603,037
    )Adjustments to reconcile net loss to net cash used in continuing
operating activities:Depreciation and amortization
    
    
    319,961
    
    
    
    354,851Bad debt expense
    
    
    (31,130
    )
    
    
    (6,475
    )Deferred income tax benefit
    
    
    (2,086
    )
    
    
    (1,078,655
    )Loss on disposal of property, plant and equipment
    
    
    (28,949
    )
    
    
    13,809Stock-based compensation
    
    
    206,577
    
    
    
    197,825Deferred income
    
    
    (3,181
    )
    
    
    (18,234
    )Deferred lease liability
    
    
    9,830
    
    
    
    (28,953
    )Recovery of Focus Surgery, Inc. investment
    
    
    
    
    
    
    (693,044
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    521,120
    
    
    
    809,209Inventories
    
    
    (1,079,789
    )
    
    
    358,591Income taxes
    
    
    (16,068
    )
    
    
    (109,511
    )Prepaid expenses and other current assets
    
    
    (235,337
    )
    
    
    (471,220
    )Accounts payable and accrued expenses
    
    
    478,311
    
    
    
    475,719Other
    
    
    213,803
    
    
    
    (964,419
    )Net cash used in operating activities
    
    
    (1,454,787
    )
    
    
    (2,763,544
    )Investing activitiesAcquisition of property, plant and equipment
    
    
    (584,200
    )
    
    
    (906,013
    )Acquisition of assets from Aesculap, Inc.
    
    
    (929,880
    )
    
    
    Recovery of Focus Surgery, Inc. investment
    
    
    
    
    
    
    693,044Net cash used in investing activities
    
    
    (1,514,080
    )
    
    
    (212,969
    )Financing activitiesProceeds from short-term borrowings
    
    
    
    
    
    
    9,514,892Payments of short-term borrowings
    
    
    (177,679
    )
    
    
    (12,150,652
    )Principal payments on capital lease obligations
    
    
    (10,866
    )
    
    
    (10,110
    )Net cash used in financing activities
    
    
    (188,545
    )
    
    
    (2,645,870
    )Cash flows from discontinued operationsNet cash (used in) provided by operating activities
    
    
    (277,641
    )
    
    
    202,720Net cash provided by investing activities
    
    
    1,115,000
    
    
    
    11,200,000Net cash provided by discontinued operations
    
    
    837,359
    
    
    
    11,402,720Effect of exchange rate changes on cash
    
    
    3,923
    
    
    
    (16,917
    )Net (decrease) increase in cash
    
    
    (2,316,130
    )
    
    
    5,763,420Cash at beginning of period
    
    
    9,900,605
    
    
    
    3,415,813Cash at end of period
    
    $
    7,584,475
    
    
    $
    9,179,233Supplemental disclosure of cash flow information:Cash paid for:Interest
    
    $
    5,494
    
    
    $
    254,152Income taxes
    
    $
    42,100
    
    
    $
    63,763
 See Accompanying Notes to Consolidated Financial Statements.
  7




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
 
 Notes to Consolidated Financial Statements
 (Unaudited)
 Basis of Presentation
    Organization and Business
      8




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
Notes to Consolidated Financial Statements
  Discontinued Operations
     9




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
Notes to Consolidated Financial Statements
 st ®
   For the three months ended
    
    
    For the nine months endedMarch 31,
    
    
    March 31,2011
    
    
    2010
    
    
    2011
    
    
    2010Revenues
    
    $
    
    
    
    $
    216,472
    
    
    $
    
    
    
    $
    4,478,238(Loss) income from discontinued operations, before tax
    
    $
    (131,356
    )
    
    $
    (345,752
    )
    
    $
    (277,641
    )
    
    $
    931,202Gain on sale of Labcaire
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    762,221Loss on sale of Sonora
    
    
    
    
    
    
    (257,029
    )
    
    
    
    
    
    
    (174,132
    )Income tax (benefit) expense
    
    
    
    
    
    
    (111,763
    )
    
    
    
    
    
    
    1,316,571(Loss) income from discontinued operations, net of tax
    
    $
    (131,356
    )
    
    $
    (491,018
    )
    
    $
    (277,641
    )
    
    $
    202,720
  Reclassification
  Net Income (Loss) Per Share of Common Stock
   10




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
Notes to Consolidated Financial Statements
  For the nine months ended
    
    
    For the three months endedMarch 31,
    
    
    March 31,2011
    
    
    2010
    
    
    2011
    
    
    2010Basic shares
    
    
    7,001,369
    
    
    
    7,001,369
    
    
    
    7,001,369
    
    
    
    7,001,369Dilutive effect of stock options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    37,016Diluted shares
    
    
    7,001,369
    
    
    
    7,001,369
    
    
    
    7,001,369
    
    
    
    7,038,385
   Comprehensive Loss
  Stock-Based Compensation
     11




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
Notes to Consolidated Financial Statements
  For the nine months endedMarch 31,2011
    
    
    2010Risk-free interest rate
    
    
    4.1
    %
    
    
    3.1
    %Expected option life in years
    
    
    6.5
    
    
    
    6.5Expected stock price volatility
    
    
    77.9
    %
    
    
    81.9
    %Expected dividend yield
    
    
    0
    %
    
    
    0
    %Weighted-average fair value of options granted
    
    $
    1.61
    
    
    $
    2.02
   OptionsWeightedWeighted
    
    
    AverageAverage
    
    
    Remaining
    
    
    AggregateNumber of
    
    
    Exercise
    
    
    Contractual
    
    
    IntrinsicShares
    
    
    Price
    
    
    Life (years)
    
    
    Value (a)Outstanding as of June 30, 2010
    
    
    1,848,510
    
    
    $
    4.99
    
    
    
    5.3Granted
    
    
    294,500
    
    
    
    1.97Forfeited
    
    
    (2,010
    )
    
    
    1.67Expired
    
    
    (330,450
    )
    
    
    7.34Outstanding as of March 31, 2011
    
    
    1,810,550
    
    
    
    4.08
    
    
    
    5.9
    
    
    $
    233,056Exercisable and vested at March 31, 2011
    
    
    1,256,163
    
    
    $
    4.93
    
    
    
    4.3
    
    
    $
    53,971Available for grant at March 31, 2011
    
    
    666,894
 (a)
    
    Intrinsic value for purposes of this table represents the amount
by which the fair value of the underlying stock, based on the
respective market prices at March 31, 2011 or if exercised, the
exercise dates, exceeds the exercise prices of the respective
options. Focus Surgery, Inc.
   12




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
Notes to Consolidated Financial Statements
 Income Taxes
   Inventories
 March 31,
    
    
    June 30,2011
    
    
    2010Raw material
    
    $
    2,483,259
    
    
    
    1,997,730Work-in-process
    
    
    1,372,204
    
    
    
    947,924Finished goods
    
    
    548,735
    
    
    
    304,1684,404,198
    
    
    
    3,249,822Less valuation reserve  continuing operations
    
    
    494,255
    
    
    
    550,105$
    3,909,943
    
    
    
    2,699,717
 Accrued Expenses and Other Current Liabilities
 March 31,
    
    
    June 30,2011
    
    
    2011Accrued payroll and vacation
    
    
    452,286
    
    
    
    455,052Accrued VAT and sales tax
    
    
    
    
    
    
    21,693Accrued bonus
    
    
    140,000
    
    
    
    202,852Accrued commissions
    
    
    161,000
    
    
    
    43,000Accrued professional and legal fees
    
    
    66,718
    
    
    
    24,176Royalty expense
    
    
    126,208
    
    
    
    103,162Foreign income tax payable
    
    
    
    
    
    
    18,676Deferred income
    
    
    79,245
    
    
    
    24,000Current maturities of capital lease obligations
    
    
    15,340
    
    
    
    14,533Other
    
    
    91,242
    
    
    
    93,379$
    1,132,039
    
    
    $
    1,000,523
  13




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
Notes to Consolidated Financial Statements
 Commitments and Contingencies
  Business Segments
 TM
  14




---



##### Table of Contents



MISONIX, INC and Subsidiaries
Notes to Consolidated Financial Statements
  Medical
    
    
    Laboratory and
    
    
    Corporate andDevices
    
    
    Scientific Products
    
    
    Unallocated
    
    
    TotalNet sales
    
    $
    8,607,594
    
    
    $
    1,667,237
    
    
    $
    
    
    
    $
    10,274,831Cost of goods sold
    
    
    3,655,203
    
    
    
    1,222,644
    
    
    
    
    
    
    
    4,877,847Gross profit
    
    
    4,952,391
    
    
    
    444,593
    
    
    
    
    
    
    
    5,396,984Selling expenses
    
    
    2,700,381
    
    
    
    398,586
    
    
    
    
    
    
    
    3,098,967Research and development
    
    
    1,095,733
    
    
    
    207,388
    
    
    
    
    
    
    
    1,303,121General and administrative
    
    
    
    
    
    
    
    
    
    
    3,334,338
    
    
    
    3,334,338Total operating expenses
    
    
    3,796,114
    
    
    
    605,974
    
    
    
    3,334,338
    
    
    
    7,736,426Operating income (loss) from continuing operations
    
    $
    1,156,277
    
    
    $
    (161,381
    )
    
    $
    (3,334,338
    )
    
    $
    (2,339,442
    )Net loss from discontinued operations
    
    $
    (105,364
    )
    
    $
    (172,277
    )
    
    $
    
    
    
    $
    (277,641
    )
  Medical
    
    
    Laboratory and
    
    
    Corporate andDevices
    
    
    Scientific Products
    
    
    Unallocated
    
    
    TotalNet sales
    
    $
    7,132,493
    
    
    $
    1,959,829
    
    
    $
    
    
    
    $
    9,092,322Cost of goods sold
    
    
    3,406,800
    
    
    
    1,453,739
    
    
    
    
    
    
    
    4,860,539Gross profit
    
    
    3,725,693
    
    
    
    506,090
    
    
    
    
    
    
    
    4,231,783Selling expenses
    
    
    2,270,471
    
    
    
    379,228
    
    
    
    
    
    
    
    2,649,699Research and development
    
    
    1,137,682
    
    
    
    249,451
    
    
    
    
    
    
    
    1,387,133General and administrative
    
    
    
    
    
    
    
    
    
    
    3,824,640
    
    
    
    3,824,640Total operating expenses
    
    
    3,408,153
    
    
    
    628,679
    
    
    
    3,824,640
    
    
    
    7,861,472Operating income (loss) from continuing operations
    
    $
    317,540
    
    
    $
    (122,589
    )
    
    $
    (3,824,640
    )
    
    $
    (3,629,689
    )Net (loss) income from discontinued operations
    
    $
    (124,139
    )
    
    $
    326,859
    
    
    $
    
    
    
    $
    202,720
  15




---



##### Table of Contents



MISONIX, INC and Subsidiaries
Notes to Consolidated Financial Statements
  Medical
    
    
    Laboratory and
    
    
    Corporate andDevices
    
    
    Scientific Products
    
    
    Unallocated
    
    
    TotalNet sales
    
    $
    3,152,771
    
    
    $
    440,383
    
    
    $
    
    
    
    $
    3,593,154Cost of goods sold
    
    
    1,396,200
    
    
    
    323,837
    
    
    
    
    
    
    
    1,720,037Gross profit
    
    
    1,756,571
    
    
    
    116,546
    
    
    
    
    
    
    
    1,873,117Selling expenses
    
    
    972,174
    
    
    
    107,093
    
    
    
    
    
    
    
    1,079,267Research and development
    
    
    362,295
    
    
    
    52,047
    
    
    
    
    
    
    
    414,342General and administrative
    
    
    
    
    
    
    
    
    
    
    1,007,051
    
    
    
    1,007,051Total operating expenses
    
    
    1,334,469
    
    
    
    159,140
    
    
    
    1,007,051
    
    
    
    2,500,660Operating income (loss) from continuing operations
    
    $
    422,102
    
    
    $
    (42,594
    )
    
    $
    (1,007,051
    )
    
    $
    (627,543
    )Net income (loss) from discontinued operations
    
    $
    40,921
    
    
    $
    (172,277
    )
    
    $
    
    
    
    $
    (131,356
    )
  Medical
    
    
    Laboratory and
    
    
    Corporate andDevices
    
    
    Scientific Products
    
    
    Unallocated
    
    
    TotalNet sales
    
    $
    2,634,967
    
    
    $
    678,164
    
    
    $
    
    
    
    $
    3,313,131Cost of goods sold
    
    
    1,115,562
    
    
    
    480,702
    
    
    
    
    
    
    
    1,596,264Gross profit
    
    
    1,519,405
    
    
    
    197,462
    
    
    
    
    
    
    
    1,716,867Selling expenses
    
    
    544,920
    
    
    
    126,293
    
    
    
    
    
    
    
    671,213Research and development
    
    
    357,145
    
    
    
    83,948
    
    
    
    
    
    
    
    441,093General and administrative
    
    
    
    
    
    
    
    
    
    
    1,021,476
    
    
    
    1,021,476Total operating expenses
    
    
    902,065
    
    
    
    210,241
    
    
    
    1,021,476
    
    
    
    2,133,782Operating income (loss) from continuing operations
    
    $
    617,340
    
    
    $
    (12,779
    )
    
    $
    (1,021,476
    )
    
    $
    (416,915
    )Net loss from discontinued operations
    
    $
    (475,346
    )
    
    $
    (15,672
    )
    
    $
    
    
    
    $
    (491,018
    )
  16




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
Notes to Consolidated Financial Statements
  three months ended March 31,2011
    
    
    2010United States
    
    $
    2,610,899
    
    
    $
    2,216,915Australia
    
    
    32,940
    
    
    
    3,025Europe
    
    
    528,355
    
    
    
    444,367Asia
    
    
    109,701
    
    
    
    341,144Canada and Mexico
    
    
    100,308
    
    
    
    13,135South America
    
    
    101,615
    
    
    
    165,209South Africa
    
    
    
    
    
    
    2,361Middle East
    
    
    81,950
    
    
    
    150,492Other
    
    
    27,386
    
    
    
    (23,517
    )$
    3,593,154
    
    
    $
    3,313,131
 nine months ended March 31,2011
    
    
    2010United States
    
    $
    7,495,299
    
    
    $
    6,988,004Australia
    
    
    97,403
    
    
    
    37,297Europe
    
    
    1,256,595
    
    
    
    873,866Asia
    
    
    320,548
    
    
    
    598,184Canada and Mexico
    
    
    260,921
    
    
    
    72,997South America
    
    
    385,408
    
    
    
    226,822South Africa
    
    
    141,712
    
    
    
    8,801Middle East
    
    
    269,808
    
    
    
    239,454Other
    
    
    47,137
    
    
    
    46,897$
    10,274,831
    
    
    $
    9,092,322
 Fair Value of Financial Instruments
      CarryingMarch 31, 2011
    
    Amount
    
    
    Fair ValueCash
    
    $
    7,584,475
    
    
    $
    7,584,475Trade accounts receivable
    
    
    1,859,026
    
    
    
    1,859,026Trade accounts payable
    
    
    1,293,455
    
    
    
    1,293,455Note receivable
    
    
    210,000
    
    
    
    210,000Note payable
    
    
    
    
    
    
    
 CarryingJune 30, 2010
    
    Amount
    
    
    Fair ValueCash
    
    $
    9,900,605
    
    
    $
    9,900,605Trade accounts receivable
    
    
    2,335,653
    
    
    
    2,335,653Trade accounts payable
    
    
    888,654
    
    
    
    888,654Notes receivable
    
    
    1,075,105
    
    
    
    1,075,105Note payable
    
    
    177,679
    
    
    
    177,679
  17




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
Notes to Consolidated Financial Statements
  Cash
  Trade Accounts Receivable
  Trade Accounts Payable
  Note Receivable
  Note Payable
  Non-financial assets and liabilities:
  Goodwill and Intangible Assets
     18




---



##### Table of Contents



MISONIX, INC. and Subsidiaries
Notes to Consolidated Financial Statements
  CustomerPatents
    
    
    RelationshipsJune 30, 2011
    
    $
    17,000
    
    
    $
    40,000June 30, 2012
    
    
    63,000
    
    
    
    160,000June 30, 2013
    
    
    60,000
    
    
    
    160,000June 30, 2014
    
    
    57,000
    
    
    
    160,000June 30, 2015
    
    
    51,000
    
    
    
    160,000Thereafter
    
    
    294,000
    
    
    
    40,000$
    542,000
    
    
    $
    720,000
 . Recent Accounting Pronouncements
       19




---



##### Table of Contents



Improving Disclosures
about Fair Value Measurements
 When to Perform Step 2 of the Goodwill Impairment
Test for Reporting Units with Zero or Negative Carrying Amounts,
 . Subsequent Events
  
 Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations.
  Forward Looking Statements
   20




---



##### Table of Contents



Net sales :
 Gross profit :
 Selling expenses :
 General and administrative expenses :
 Research and development expenses :
 Other income (expense) :
 Income taxes :
  21




---



##### Table of Contents



Net sales :
 Gross profit :
 Selling expenses :
 General and administrative expenses :
 Research and development expenses :
 Other income (expense) :
 Income taxes :
  22




---



##### Table of Contents



Liquidity and Capital Resources
   Off-Balance Sheet Arrangements
  Other
  New Accounting Pronouncements
  
 Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk.
 Market Risk:
  Interest Rate Risk:
   23




---



##### Table of Contents



Item 4.
    
    Controls and Procedures.
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control Over Financial Reporting
  
 PART II  OTHER INFORMATION
 
 Item 1.
    
    Legal Proceedings.
  
 Item 1A.
    
    Risk Factors.
  
 Item 6.
    
    Exhibits.
 Exhibit 31.1-
    
    Rule 13a-14(a)/15d-14(a) CertificationExhibit 31.2-
    
    Rule 13a-14(a)/15d-14(a) CertificationExhibit 32.1-
    
    Section 1350 Certification of Chief Executive OfficerExhibit 32.2-
    
    Section 1350 Certification of Chief Financial Officer
  24




---



##### Table of Contents



SIGNATURES
   MISONIX, INC.

(Registrant)By:
    /s/ Michael A. McManus, Jr.Michael A. McManus, Jr.President and Chief Executive OfficerBy:
    /s/ Richard ZarembaRichard ZarembaSenior Vice President, Chief Financial Officer, Treasurer and Secretary  25