8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  April 9, 2014

BSD MEDICAL CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	0-10783	75-1590407
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2188 West 2200 South

Salt Lake City, Utah 84119

(Address of principal executive offices, including Zip Code)

Registrant’s telephone number, including area code:  (801) 972-5555

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02  Results of Operations and Financial Condition.

On April 9, 2014, BSD Medical Corporation (the “Company”) issued a press release reporting financial results for its fiscal quarter ended February 28, 2014.  A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01  Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
99.1	Press release dated April 9, 2014 regarding financial results for the fiscal quarter ended February 28, 2014

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	BSD MEDICAL CORPORATION
Date:  April 9, 2014
	By:  /s/ William S. Barth
	Name:  William S. Barth
	Title:    Chief Financial Officer

EX-99.1

Exhibit 99.1

BSD MEDICAL CORPORATION	Contact: William Barth
2188 West 2200 South	Telephone: (801) 972-5555
Salt Lake City, Utah 84119-1326	Facsimile: (801) 972-5930
NASDAQ:BSDM	Email: investor@bsdmc.com

For Immediate Release

BSD Medical Announces Second Quarter Fiscal 2014 Financial Results

Total Revenues More Than Double for the Second Consecutive Quarter

Company to Hold Investment Community Conference Call at 2:00 p.m. Eastern Today

SALT LAKE CITY,April 9, 2014 - BSD Medical Corporation (NASDAQ: BSDM) (Company or BSD) (www.BSDMedical.com), a leading provider of medical systems that treat cancer and benign diseases using heat therapy, today reported financial results for the three months and six months ended February 28, 2014.

Second Quarter of Fiscal 2014 Highlights (all comparisons with the second quarter of fiscal 2013)

· Total revenues increased 106% to $1.7 million

· Operating costs and expenses declined slightly to $2.2 million

· Net loss of $1.5 million, an improvement of $.4 million from $1.9 million

First Half of Fiscal 2014 Highlights (all comparisons with the first half of fiscal 2013)

· Total revenues doubled to $3.0 million compared to $1.5 million

· Gross margin improved to 48%, from 40%

· Operating costs and expenses were reduced to $4.4 million from $4.7 million

· Net loss of $3.0 million dollars, a $1.1 million improvement from a net loss of $4.1 million

· Total sales backlog of $1.6 million, a 96% increase

The Company reported cash and equivalents of $7.0 million and no debt at February 28, 2014.

Management Commentary

“We are pleased to report our second consecutive quarter of more than 100% year-over-year revenue growth, and a reduced loss,” said Harold Wolcott, President of BSD Medical. “Our higher revenues are primarily from increasing sales of our MicroThermX products.  Our operating costs and expenses remained relatively unchanged from the prior year, even though we more than doubled total revenues. By increasing sales and reducing operating costs and expenses, we significantly reduced our net loss, compared with the same prior year periods.”

“BSD is very encouraged with the progress and the sales momentum for the MicroThermX system under our exclusive master distribution agreement with Terumo Europe NV.  Terumo has already established sales in many of the Western European countries.   Terumo will now expand its marketing into additional Western European countries, Eastern European countries, and several other markets defined in the distribution agreement,” Mr. Wolcott added.   “We see tremendous potential for the MicroThermX Microwave Ablation System to meet the worldwide market trend toward effective, less invasive and more cost-effective therapies.”

“With the recent approval by the Taiwan Food and Drug Administration for the BSD-2000 Hyperthermia System, we were able to ship additional hyperthermia systems in the first half of fiscal 2014.  Our distributor in Taiwan has also committed to purchase other BSD-2000 Hyperthermia Systems before the end of BSD’s current fiscal year,”  Mr. Wolcott concluded.

Second Quarter and First Half of Fiscal 2014 Operating Summary

BSD reported total revenues for the second quarter of fiscal year 2014 of $1.7 million, more than doubling the $0.8 million from the second quarter of fiscal year 2013. This increase in revenues was driven primarily by increased sales of MicroThermX products and the sale of two hyperthermia systems. The Company has a current sales backlog of $1.6 million.

Gross margin was $0.8 million, or 45% of total revenues, for the second quarter of fiscal 2014, compared to $0.4 million, or 49% of total revenues, for the same period last year. Lower gross margin percent resulted from a change in product mix.

Operating costs and expenses declined slightly to $2.2 million during the second quarter of fiscal 2014 from $2.3 million in the comparable prior year period.

Increased sales and lower operating costs and expenses resulted in a reduction in our net loss. The Company reported a net loss of $1.5 million, or $0.04 per share, for the second quarter of fiscal 2014, compared with a net loss of $1.9 million, or $0.06 per share, for the second quarter of fiscal 2013.

Total revenues for the first half of fiscal 2014 increased 104% to $3.0 million, from $1.5 million in the prior year.  Gross margin was $1.5 million, or 48% of total revenues, for the six months ended February 28, 2014, compared with $0.6 million, or 40% of total revenues, for the six months ended February 28, 2013.  Operating costs and expenses for the first half of 2014 decreased to $4.4 million from $4.7 million in the prior year period.  Net loss for the first half of fiscal 2014 declined to $3.0 million dollars, or $0.09 per share, from a net loss of $4.1 million, or $0.14 per share, for the first half of fiscal 2013.

Conference Call

Management will hold a conference call today at 2:00 p.m. Eastern time/12:00 p.m. Mountain time to discuss financial results and provide a business update.  Individuals may participate on the call by dialing 877-941-1466 in the U.S. or 480-629-9870 outside the U.S. and entering passcode 4673204. A telephone replay will be available until April 16, 2014, by dialing 800-406-7325 in the U.S. or by dialing 303-590-3030 outside the U.S. and entering conference ID 4673204. The conference call will be available via webcast for 90 days by visiting the Investor Relations section of the Company's website at www.BSDMedical.com.

About BSD Medical Corporation

BSD Medical Corporation develops, manufactures, markets and services systems to treat cancer and benign diseases using heat therapy, which is delivered using focused radiofrequency (RF) and microwave energy. BSD’s product lines include both hyperthermia and ablation treatment systems. BSD’s MicroThermX microwave ablation system has been developed as a stand-alone therapy to employ precision-guided microwave energy to ablate (destroy) soft tissue. The Company has developed extensive intellectual property, multiple products in the market and established distribution in the United States, Europe and Asia. Certain of the Company’s products have received regulatory approvals and clearances in the United States, Europe and China. For further information visit BSD Medical's website at www.BSDMedical.com.

Forward-Looking Statements.

This press release contains forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements relating to its financial results and expectations, Terumo’s marketing plans, the potential for the MicroThermX Microwave Ablation System, the purchasing plans of our distributor in Taiwan and hyperthermia revenue opportunities. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results due to a variety of factors, including, among other things, the demand for the Company’s products, the ability of the Company to produce the products to meet the demand, global economic conditions and uncertainties in the geopolitical environment and other risk factors set forth in the Company’s most recent reports on Form 10-K and Form 10-Q. Any forward-looking statements in this release are based on limited information currently available to the Company, which is subject to change, and the Company will not necessarily update the information.

BSD MEDICAL CORPORATION
Condensed Balance Sheets
(Unaudited)
ASSETS	February 28, 2014			August 31, 2013
Current assets:
Cash and cash equivalents	$	7,023,187		$	9,450,528
Accounts receivable, net of allowance for doubtful accounts of $20,000		669,988			899,969
Related party trade accounts receivable		5,026			24,201
Inventories, net		2,430,385			2,445,770
Other current assets		153,565			200,028
Total current assets		10,282,151			13,020,496
Property and equipment, net		1,286,087			1,319,880
	$	11,568,238		$	14,340,376
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	334,085		$	521,417
Accrued liabilities		623,179			573,880
Customer deposits		324,630			317,480
Deferred revenue – current portion		693,808			730,593
Total current liabilities		1,975,702			2,143,370
Deferred revenue – net of current portion		13,038			53,115
Total liabilities		1,988,740			2,196,485
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $.001 par value; 10,000,000 shares authorized, no shares issued and outstanding		-			-
Common stock, $.001 par value, 80,000,000 shares authorized, 34,006,202 shares issued		34,007			34,007
Additional paid-in capital		58,157,627			57,739,056
Treasury stock, 24,331 shares at cost		(234	)		(234	)
Accumulated deficit		(48,611,902	)		(45,628,938	)
Total stockholders’ equity		9,579,498			12,143,891
	$	11,568,238		$	14,340,376

BSD MEDICAL CORPORATION

Condensed Statements of Comprehensive Loss

(Unaudited)

	Three Months Ended						Six Months Ended
	February 28, 2014			February 28, 2013			February 28, 2014			February 28, 2013
Revenues:
Sales	$	1,616,076		$	766,084		$	2,847,635		$	1,283,698
Sales to related parties		1,748			6,275			18,434			76,546
Equipment rental		72,900			46,900			155,300			118,800
Total revenues		1,690,724			819,259			3,021,369			1,479,044
Cost of Revenues:
Cost of sales		918,426			411,365			1,547,137			820,235
Cost of related party sales		259			5,069			7,913			66,446
Cost of equipment rental		2,947			2,947			5,894			5,894
Total cost of revenues		921,632			419,381			1,560,944			892,575
Gross margin		769,092			399,878			1,460,425			586,469
Operating costs and expenses:
Research and development		559,287			558,691			1,062,044			1,085,958
Selling, general and administrative		1,682,319			1,705,682			3,387,032			3,594,931
Total operating costs and expenses		2,241,606			2,264,373			4,449,076			4,680,889
Loss from operations		(1,472,514	)		(1,864,495	)		(2,988,651	)		(4,094,420	)
Other income (expense):
Interest income		5,104			6,720			11,427			16,666
Other expense		(2,693	)		(3,622	)		(5,740	)		(2,307	)
Total other income		2,411			3,098			5,687			14,359
Loss before income taxes		(1,470,103	)		(1,861,397	)		(2,982,964	)		(4,080,061	)
Income tax benefit		-			-			-			-
Net comprehensive loss	$	(1,470,103	)	$	(1,861,397	)	$	(2,982,964	)	$	(4,080,061	)
Net loss per common share:
Basic	$	(0.04	)	$	(0.06	)	$	(0.09	)	$	(0.14	)
Diluted	$	(0.04	)	$	(0.06	)	$	(0.09	)	$	(0.14	)
Weighted average number of shares outstanding:
Basic		33,982,000			29,778,000			33,982,000			29,778,000
Diluted		33,982,000			29,778,000			33,982,000			29,778,000

BSD MEDICAL CORPORATION

Condensed Statements of Cash Flows

(Unaudited)

	Six Months Ended
	February 28, 2014			February 28, 2013
Cash flows from operating activities:
Net loss	$	(2,982,964	)	$	(4,080,061	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		61,377			70,026
Stock-based compensation		418,571			576,332
Decrease (increase) in:
Receivables		249,156			(183,526	)
Inventories		15,385			23,922
Other current assets		46,463			(53,308	)
Increase (decrease) in:
Accounts payable		(187,332	)		103,455
Accrued liabilities		49,299			212,304
Customer deposits		7,150			16,270
Deferred revenue		(76,862	)		(43,337	)
Net cash used in operating activities		(2,399,757	)		(3,357,923	)
Cash flows from investing activities:
Purchase of property and equipment		(27,584	)		(12,739	)
Cash flows from financing activities		-			-
Net decrease in cash and cash equivalents		(2,427,341	)		(3,370,662	)
Cash and cash equivalents, beginning of the period		9,450,528			11,102,508
Cash and cash equivalents, end of the period	$	7,023,187		$	7,731,846