See footnote about the use of pro forma financial information

Fourth Quarter 2015 Highlights:

• Consolidated total revenue increased 14.1% to a record $22.3 million compared to pro forma fourth quarter 2014 revenue of $19.5 million
• Consolidated gross profit increased 14.9% to $14.9 million compared to pro forma fourth quarter 2014 gross profit of $13.0 million
• Consolidated gross margins improved to 67.0%, compared to 66.5% reported in the fourth quarter of 2014
• Consolidated net income for the quarter improved to $11.6 million compared to a pro forma net loss of $5.0 million in the fourth quarter of 2014
• Consolidated earnings per share improved to $0.97 compared to pro forma loss per share of $0.35 in the fourth quarter of 2014

Full-Year 2015 Highlights:

• Pro forma total revenue increased 11.4% to $86.5 million compared to pro forma 2014 revenue of $77.7 million
• Pro forma gross profit increased 10.5% to $56.6 million compared to pro forma 2014 gross profit of $51.2 million
• Pro forma gross margins for the year were 65.4%, which were slightly lower than the previous year
• Pro forma net loss for the year improved to $5.8 million compared to pro forma net loss of $15.6 million in 2014

BELGRADE, Mont., March 15, 2016 (GLOBE NEWSWIRE) -- Xtant™ Medical Holdings, Inc. (NYSE:XTNT), a leader in the development of regenerative medicine products and medical devices, today reported its financial results for the period ended December 31st, 2015. On a pro forma basis, the Company reported annual revenues of approximately $86.5 million and a net loss for the year of approximately $5.8 million.

Revenue

Consolidated fourth quarter 2015 revenue was approximately $22.3 million, an increase of 14.1% compared to pro forma revenue of approximately $19.5 million for the same period during 2014.

Pro forma revenue for the full year 2015 was approximately $86.5 million, compared to pro forma 2014 revenue of approximately $77.7 million, representing an increase of 11.4% over the prior year. Excluding revenue associated with an Original Equipment Manufacturer (OEM) customer, pro forma full year 2015 revenue increased 14.8% to $81.4 million.

Gross Profit

Consolidated gross profit for the fourth quarter of 2015 was $14.9 million or 67.0% of revenues, compared to pro forma gross profit of $13.0 million or 66.5% of revenues for the fourth quarter of 2014.

For the year, pro forma gross profit was approximately $56.6 million, compared with pro forma 2014 gross profit of $51.2 million. Pro forma gross margin for the year was 65.4%, slightly lower than 2014 pro forma gross margin of 66.0%

Sales and Marketing Expenses

Consolidated fourth quarter 2015 sales and marketing expenses increased to $10.6 million, as compared to pro forma sales and marketing expenses of $9.3 million during the same period in 2014. For the quarter, sales and marketing as a percentage of revenues increased slightly to 47.6%, compared to 47.4% in the fourth quarter of 2014, on a pro forma basis.

Pro forma 2015 sales and marketing expenses increased to $39.3 million, as compared to pro forma 2014 sales and marketing expenses of $33.3 million. As a percentage of revenues, sales and marketing expenses increased to 45.5% compared to 42.9% reported for the full year 2014. The increase was mainly due to the Company's planned and strategic expansion of its salesforce, combined with its acquisition of X-spine during the third quarter of 2015.

General and Administrative Expenses

In the fourth quarter, consolidated general and administrative expenses increased to $4.2 million as compared to pro forma general and administrative expenses of $3.3 million reported for the same period last year. As a percentage of revenues, general and administrative expenses were 18.9% during the period as compared to 16.7% for the same period during 2014. The increase in general and administrative expenses was primarily attributable to increased headcount for the X-spine subsidiary.

Pro forma 2015 general and administrative expenses increased to $16.6 million as compared with $13.9 million reported for the same pro forma period last year. As a percentage of revenues, general and administrative expenses were 19.2% as compared to 17.9% for 2014.

Net Income / Loss

The fourth quarter 2015 consolidated net income was $11.6 million, compared to the pro forma year-ago period net loss of $5.0 million. The increase was primarily due to a one-time recording of a deferred tax benefit of $17.5 million. Consolidated earnings per share improved to $0.97 compared to pro forma loss per share of $0.35 in the fourth quarter of 2014.

For the full-year 2015, the Company had a pro forma net loss of $5.8 million compared to a pro forma net loss of $15.6 million for 2014. Pro forma net loss per share for the full-year 2015 was $0.65 a share compared to pro forma net loss per share of $1.11 for 2014.

EBITDA

The Company defines earnings before interest, taxes, depreciation and amortization ("EBITDA") as net income/loss from operations before depreciation, amortization, impairment charges, non-recurring expenses and non-cash stock-based compensation. Consolidated EBITDA for the fourth quarter of 2015 was a loss of $350,000 compared to a pro forma gain of $403,000 for the same period during 2014. The unfavorable change in EBITDA was due to higher sales and marketing and general and administrative expenses.

Full year 2015 pro forma EBITDA was a loss of $33,000 compared to a pro forma gain of $3.9 million in the prior year.

Financial Liquidity

Cash on hand as of December 31, 2015, was $6.4 million, as compared to $4.5 million as of December 31, 2014. Net working capital as of December 31, 2015 increased $13.3 million to $23.9 million, as compared to $10.6 million as of December 31, 2014.

Outlook for Full Year 2016

The Company also provided full year 2016 revenue guidance based on the following:

Conference Call to be Held March 16, 2016

An accompanying conference call will be hosted by Dan Goldberger, Chief Executive Officer, and John Gandolfo, Chief Financial Officer, to discuss the results. The call will be held at 10:00 AM ET, on March 16, 2016. Please refer to the information below for conference call dial-in information and webcast registration.

Conference Date: March 16, 2016, 10:00 AM ET
Conference Dial-in: 877-269-7756
International Dial-in: 201-689-7817
Conference Call Name: Xtant Medical's Fourth Quarter 2015 Results Call
Webcast Registration: Click Here

Following the live call, a replay will be available on the Company's website, www.xtantmedical.com, under "Investor Info."

Use of Pro Forma Financial Information

On July 31, 2015, Bacterin International Holdings, Inc. acquired all of the issued and outstanding stock of X-Spine Systems, Inc. and the combined company was renamed Xtant Medical Holdings, Inc. Except for the financial results for the three months ended December 31, 2015, the results presented are on a pro forma basis as if the two companies were combined for the periods shown. Certain pro forma adjustments have been made to reflect the impact of the purchase transaction, primarily consisting of amortization of intangible assets with determinable lives and interest expense on long-term debt. In addition, certain historical expenses, such as warrant expense and interest expense associated with debt that was immediately repaid, were eliminated from these pro-forma results. The pro forma information does not necessarily reflect the actual results of operations had the acquisition been consummated at the beginning of the fiscal reporting period indicated nor is it indicative of future operating results. The pro forma information does not include any adjustment for potential revenue enhancements, cost synergies or other operating efficiencies that could result from the acquisition.

Additional information regarding the business combination and its impact on the Company’s financial position will be set forth in the Company’s Form 10-K for the fiscal year ended December 31, 2015, which will be filed with the Securities and Exchange Commission on or about March 30, 2016 and will include the Company’s audited consolidated financial statements as of and for the years ended December 31, 2015 and December 31, 2014.

About Xtant™ Medical Holdings, Inc.

Xtant Medical Holdings, Inc. (NYSE:XTNT) develops, manufactures and markets class-leading regenerative medicine products and medical devices for domestic and international markets. Xtant products serve the specialized needs of orthopedic and neurological surgeons, including orthobiologics for the promotion of bone healing, implants and instrumentation for the treatment of spinal disease, tissue grafts for the treatment of orthopedic disorders, and biologics to promote healing following cranial, and foot and ankle surgeries. With core competencies in both biologic and non-biologic surgical technologies, Xtant can leverage its resources to successfully compete in global neurological and orthopedic surgery markets. For further information, please visit www.xtantmedical.com.

Important Cautions Regarding Forward-looking Statements

This press release contains certain disclosures that may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to significant risks and uncertainties. Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as "continue," "efforts," "expects," "anticipates," "intends," "plans," "believes," "estimates," "projects," "forecasts," "strategy," "will," "goal," "target," "prospects," "potential," "optimistic," "confident," "likely," "probable" or similar expressions or the negative thereof. Statements of historical fact also may be deemed to be forward-looking statements. We caution that these statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, among others: the Company's ability to successfully integrate the acquisition of X-spine; the ability of the Company's sales force to achieve expected results; the Company's ability to meet its existing and anticipated contractual obligations, including financial covenant and other obligations contained in the Company's secured lending facility; the Company's ability to manage cash flow; the Company's ability to develop, market, sell and distribute desirable applications, products and services and to protect its intellectual property; the ability of the Company's customers to pay and the timeliness of such payments; the Company's ability to obtain financing as and when needed; changes in consumer demands and preferences; the Company's ability to attract and retain management and employees with appropriate skills and expertise; the impact of changes in market, legal and regulatory conditions and in the applicable business environment, including actions of competitors; and other factors.

Additional risk factors are listed in the Company's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q under the heading "Risk Factors." The Company undertakes no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as required by law.

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COCKRELL GROUP
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