22/05/2002

MediVision presents management's report for the period ended on March 31st, 2002

Yokneam Elit, Israel, MediVision Medical Imaging Ltd. (EURO.NM: MEDV) released today (May 22, 2002) information concerning its operations and the financial results for the three months period ended March 31st, 2002.

The Company's sales in the period ended March 31, 2002 were U.S.$2,153 thousands, compared to U.S.$1,941 thousands sales for parallel period in 2001, an increase of 11%. The Company has managed to maintain a high level of Gross profit which was achieved in previous year (60%).

The EBITDA for the period ended March 31, 2002 was U.S.$83 thousands, an improvement of 159%, as compared with EBITDA of U.S.$(140) thousands for the period ended March 31, 2001.

Outlook for 2002:

The Company expects FY2002 to show further improvement over the results of the pervious year, which was the first full year of the group's consolidated operation. The Company anticipates that the momentum achieved in previous year will continue and will be reflected in the results of FY2002. Noam Allon, President and CEO commented: "The Management team believes that FY2002 will show a double digit percentage increase in sales over FY2001.
The efforts made to improve operations will be further reflected in the upcoming quarters of 2002, so that the company will achieve for the first time a net profit in this financial year."

Highlights of the Period ended March 31, 2002:

AGFA-GEVAERT N.V. investment in MediVision - Further to the Investment agreement signed with AGFA GEVAERT N.V. ("Agfa"), the Company signed on April 4, 2002 an addendum according to which the Company received a second investment in the amount of $1 million in consideration of approximately 7.4% of the Company's issued share capital, representing a price of EURO 2.1 per share. An additional amount of $500 thousands shall be postponed to a later date to be mutually agreed upon.

Increase in sales volume - The sales volume for the period ended March 31, 2002 amounted to approximately U.S.$2,153 thousands, as compared to U.S.$1,941 thousands for the comparable period in 2001. The company and its subsidiary have achieved an increase of 11% over the volume of sales of the comparable period in the previous year. The on going increase in the sales volume further demonstrates the confidence of the Company's customers in the new products which were introduced to the market in the second part of 2001.

Decrease in operating expenses - During the first quarter of 2002, the Company and it's subsidiary have cut down operating expenses from $1,385 thousand in the comparable quarter of 2001, to $1,293 in the current quarter a decrease of 6.6%.
Examining operating expenses relative to the sales volume, in each of the quarters accordingly, illustrate a significant expense cut from 71% in the comparable quarter of 2001 down to 60% in the reported quarter. This cut clearly illustrates the success of the management in implementing the streamlining plan which commenced in the second part of 2001.

Information with regard to the Financial Situation For the period ending March 31, 2002

CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. Dollars (in thousands - except per share amounts)

Management's Discussion and Analysis of the Financial Condition and Results of Operations of the Company

Sales

The consolidated Sales for the period ended March 31, 2002 aggregated approximately U.S.$2,153 thousands as compared to Sales of approximately U.S.$1,941 thousands for the comparable period in the year of 2001. The company and its subsidiary have achieved an increase of approximately 11% over the previous period sales volume. The Company also achieved a significant increase in Service revenues during the three months period ended March 31, 2002 as compared to the parallel period in 2001. The revenues from Service during the said periods aggregated to approximately U.S.$183 thousands and U.S.$68 thousands respectively, reflecting an increase of 169%.

Gross profit

For the period ended March 31, 2002 Gross profit was approximately U.S.$1,290 thousands, which is 60% of sales revenues, as compared with gross profit of approximately U.S.$1,149 thousands, which was 59% for the comparable period in the year of 2001.

Research and Development Expenses

In accordance with International Accounting Standards (IAS), the Company does not capitalize its research and development expenses. Accordingly, statements of operations include research and development expenses. The Company's total R&D expenses for the period ended March 31, 2002 were approximately U.S.$283 thousands, as compared to R&D expenses of approximately U.S.$256 thousands for the comparable period of 2001. The Increase in R&D expenses for the period ended March 31, 2002 is attributed mainly to the R&D efforts made by the company in connection with the Computerized Guided Laser Treatment (C.G.L.T.) project, which is supported by the participation of the BIRD Foundation. The participation of the BIRD-F during the period ended March 31, 2002, which is included as a deduction of research and development expenses, amounted to approximately U.S.$130 thousands.

Selling and Marketing Expenses

Total Selling and Marketing expenses for the period ended March 31, 2002 were approximately U.S.$628 thousands, which are 29% of total sales revenues, as compared to U.S.$813 thousands, which were 42% of total sales revenues during the parallel period in previous year. The decrease in the relative portion of Selling and Marketing expenses from the Sales volume is attributed to the increase in sales and ongoing efforts made by the Company in order to reduce expenses and to achieve further efficiency. This dramatic reduction emphasizes the success of the management to implement the streamlining plan which started in the second part of 2001. Marketing expenses include expenses stemming from a worldwide marketing campaign, trade shows, advertising in professional publications travel, salaries and commissions.

General and Administrative Expenses

General and Administration expenses include mainly management salaries, professional services, rental, maintenance and various provisions. Total General and Administrative expenses for the period ended March 31, 2002 were approximately U.S.$512 thousands, which are 24% of the total sales, as compared to U.S.$456 thousands, which were 23% of the total sales during parallel period in previous year. Excluding the provisions, General and Administrative expenses remained the same as in the parallel period of the previous year.

About MediVision

MediVision specializes in digital imaging devices for ophthalmic applications with an emphasis on diagnostics related to the eye retina. MediVision's products provide digital upgrades for a range of ophthalmic imaging systems, thus significantly enhancing imaging capability and providing its users with advanced diagnostic tools. The company's goals are to achieve significant market share and be a market leader in the ophthalmic digital imaging field.

The company owns a 73% interest in Ophthalmic Imaging Systems Inc. based in Sacramento, California, USA.

This Release contains certain forward-looking statements and information relating to the Company that are based on the beliefs of the Management of the Company as well as assumptions made by and information currently available to the Management of the Company. Such statements reflect the current views of the Company with respect to future events, the outcome of which is subject to certain risks and other factors, which may be outside of the Company's control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results of outcomes may vary materially from those described herein as projected, anticipated, believed, estimated, expected or intended.

For more information, please contact :
Ariel Shenhar
MediVision Medical Imaging Ltd.
Vice President, Chief Financial Officer
Tel. ++972-4-9894884
Fax ++972-4-9894883
cel. ++972-52-821728

P.O. Box 45, Yokneam Elit Industrial Park 20692, Israel

ariel@medivision-ois.com

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