TLCVision Reports Fourth Quarter and Full Year 2005 Financial Results; Reaffirms Outlook for 2006

Editor's Note: "Operating Business" (or "Operating") is defined asTLCVision's operating activities excluding the impact of the AMDsegment, principally represented by our investment in OccuLogix Inc.To provide maximum transparency for investors, Operating Businessfinancial results are listed separately from consolidated results inthis press release.

"TLCVision delivered solid, broad-based revenue growth over prioryear in the operating business, which is especially noteworthy giventhe uneven demand in the core LASIK market in the fourth quarter,"said Jim Wachtman, President and Chief Executive Officer. "We metanalysts mean earnings expectations for the quarter, even whilefunding the initial start up investment in our new LASIK Select(SM)centers. The implementation of our refractive expansion strategy iswell on track, including the integration of TruVision and the openingof 5 new LASIK Select(SM) locations in the first quarter of 2006,bringing our total number of refractive centers to 83."

REVENUES

Q4 2005: TLCVision's fourth quarter consolidated net revenues were$60.5 million, an increase of 6% from the comparable period in 2004.Excluding the AMD business segment, revenues from the OperatingBusiness were $60.3 million versus $56.5 million last year, anincrease of $3.8 million or 7%.

- Total refractive revenues were up 1% to $40.8 million, withtotal refractive procedures of 39,800 compared to 42,200 the prioryear, down 6%. Center revenues were 5% higher during the quarter, assofter economic conditions resulted in a 3% decline in same storeprocedures that were more than offset by revenues from new centers.Access revenues were down by 15% due to lower demand and the loss offixed site business.

- Other healthcare services revenues (excluding AMD) increased 21%to $19.5 million, with strong growth in our mobile cataract (+22%) andambulatory surgery centers businesses (+37%). Vision Source grew by21% over the same period in 2004.

Full Year 2005: TLCVision's full year consolidated net revenueswere up 5% to $260 million, and net revenues from the OperatingBusiness were $258 million (up 5%).

- Annual refractive revenues of $186.6 million were up 2% from2004, with a total of 190,900 procedures. Centers revenues of $150.2million were up 6% from 2004, as same store revenue growth of 3%combined with the revenues from the refractive acquisitions closedearlier in the year. Access revenues for the year of $36.5 millionwere 10% lower than 2004 due to lower demand and the loss of fixedsite customers.

- Other healthcare services revenues (excluding AMD) of $71.6million grew by 12% on a full year basis and 17% in the second half of2005.

EARNINGS

Q4 2005: The consolidated business generated a net pre-tax lossfor the fourth quarter of $2.6 million, as OccuLogix loss fromoperations combined with several non-cash charges related to itsrevaluation of certain assets as a result of their preliminaryanalysis of the MIRA-1 clinical trial. After removing the loss fromthe AMD business, net pre-tax income from the Operating Business was$0.9 million or $0.01 per share. It is important to note that currentyear earnings include the start-up costs of the LASIK Select (SM)branded centers (approximately $0.4 million) and the costs to close orrenegotiate three underperforming locations (approximately $1.7million). Comparable pre-tax earnings for 2004 were $1.3 million.

Also included in the fourth quarter financial results was $1.7million of principally non-cash income tax expense, of which $1.2million related to the correction on understated income tax expense in2004.

The resulting consolidated net loss for the quarter of $4.3million compared with net income of $26.1 million for the priorperiod, including a one-time gain of $25.8 million from the company'ssale of OccuLogix shares in its initial public offering. The net lossfor the Operating Business was $0.8 million or $0.01 per fully dilutedshare.

Full Year 2005: Consolidated pre-tax income was $14.8 million or$0.21 per share. Pre-tax income from the Operating Business totaled$22.6 million for 2005, up $1.5 million or 7% from 2004. Pre-taxearnings per share were $0.32, meeting analysts mean estimates for theyear after deducting cash income tax expense of $0.01.

Income tax expense of $7.9 million for the full year includes anon-cash charge of $7.1 million. This charge corrects the reversal ofdeferred tax valuation allowances that are more properly recorded asreductions in intangible asset values and an increase to equity.Accordingly, the Company's financials have been restated for the firstthree quarters of 2005 to reflect an increase in income tax expensetotaling $5.7 million in addition to the $1.2 million adjustment for2004 noted above.

On an annual basis, consolidated net income was $6.9 million or$0.10 per share. The Operating Business generated full year net incomeof $14.7 million or $0.21 per share.

STRONG CASH GENERATION

Consolidated: The business model continues to generate strong cashflow to fund the Company's growth strategy. Consolidated operatingcash flow was $3.4 million ($0.05 per share) for the fourth quarterand $22.5 million ($0.32 per share) for the full year. Year-endconsolidated cash and short-term investments totaled $69.9 million.

Operating Business: Operating cash flow from the OperatingBusiness in the fourth quarter was $7.9 million ($0.11 per share), up$2.3 million or 42% from last year. For the full year, operating cashflow of $41.6 million, or $0.58 per share, was $6.5 million or 19%ahead of last year. The Company continues to maintain a strongfinancial position, with cash and short-term investments for theOperating Business totaling $28.7 million.

2006 FINANCIAL GUIDANCE

"We remain very confident that our strategy will continue todeliver consistent, strong growth in revenues, earnings and cash flow.With that in mind, we are reaffirming our 2006 financial guidance forthe Operating Business," said Jim Wachtman.

- 2006 net revenues of between $308 million and $318 million, or agrowth of between 19% and 23% from full year 2005 results;

- Fully diluted pre-tax earnings per share of $0.33 and $0.36,including approximately $1.1 million of compensation expense relatedto stock options which will be recorded for the first time in 2006,and costs related to our rollout of LASIK Select (SM) which areanticipated to cost $0.03 in 2006.

- Fully-taxed earnings per share of between $0.20 to $0.22,reflecting a book income tax expense at a 40% effective rate;

- Operating cash flow per share of between $0.58 and $0.62.

Conference Call

TLCVision is pleased to invite all interested parties toparticipate in a conference call during which these results will bediscussed. The call will be held today, March 16, at 10:30 am EasternTime at 1-877-888-7019. The call will also be broadcast live andarchived on the Company's web site at www.tlcv.com under the"Webcasts" link in the Investor Relations section. In addition, thelive web cast will be available at various other popular portals andfinancial web sites.

About TLCVision

TLCVision is North America's premier eye care services company,providing eye doctors with the tools and technologies needed todeliver high-quality patient care. Through its centers management andtechnology access service models, and its managed care contractingstrength, TLCVision maintains leading positions in Refractive andCataract markets. More information about TLCVision can be found on thewebsite at www.tlcv.com.

Forward Looking Statements

This press release contains certain forward-looking statementswithin the meaning of Section 27A of the U.S. Securities Act of 1933and Section 21E of the U.S. Securities Exchange Act of 1934, whichstatements can be identified by the use of forward lookingterminology, such as "may", "will", "expect", "intend", "anticipate","estimate", "predict", "plans" or "continue" or the negative thereofor other variations thereon or comparable terminology referring tofuture events or results. The Company's actual results could differmaterially from those anticipated in these forward-looking statementsas a result of numerous factors, including the timing of expenditures,effects of competition, changes to pricing, acquisitions and expansionopportunities, any of which could cause actual results to varymaterially from current results or TLCVision's anticipated futureresults. See the Company's reports filed with the Canadian SecuritiesRegulators and the U.S. Securities and Exchange Commission from timeto time for cautionary statements identifying important factors withrespect to such forward looking statements, including certain risksand uncertainties, that could cause actual results to differmaterially from results referred to in forward looking statements.TLCVision assumes no obligation to update the information contained inthis press release.

TLC VISION CORPORATION
CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands except per share amounts)

Three Months Ended Three Months Ended
December 31, 2005 December 31, 2004
------------------------------------------------------
Results Results
Before Before
AMD AMD Total AMD AMD Total
Segment Segment TLCVision Segment Segment TLCVision
------------------------------------------------------

Revenues:
Refractive:
Centers $ 33,425 $ - $ 33,425 $ 31,724 $ - $ 31,724
Access 7,368 - 7,368 8,676 - 8,676
Other
healthcare
services 19,518 206 19,724 16,130 346 16,476
------------------------------------------------------
Total revenues 60,311 206 60,517 56,530 346 56,876

Cost of
revenues:
Refractive:
Centers 25,879 - 25,879 24,599 - 24,599
Access 6,045 - 6,045 6,646 - 6,646
Other
healthcare
services 11,920 2,345 14,265 10,259 492 10,751
------------------------------------------------------
Total cost
of revenues 43,844 2,345 46,189 41,504 492 41,996
------------------------------------------------------

Gross profit
(loss) 16,467 (2,139) 14,328 15,026 (146) 14,880
------------------------------------------------------

General and
administrative 6,538 2,981 9,519 6,833 466 7,299
Marketing
and sales 5,308 168 5,476 5,063 77 5,140
Research and
development,
clinical and
regulatory - 1,456 1,456 - 576 576
Amortization
of intangibles 950 - 950 1,013 - 1,013
Other expenses,
net 1,769 1 1,770 80 - 80
------------------------------------------------------
Total
operating
costs 14,565 4,606 19,171 12,989 1,119 14,108
------------------------------------------------------
Operating
income
(loss) 1,902 (6,745) (4,843) 2,037 (1,265) 772

Gain on sale
of OccuLogix,
Inc. stock - - - - 25,792 25,792
Interest income 513 406 919 564 52 616
Interest expense (421) - (421) (418) - (418)
Minority
interests (1,834) 2,891 1,057 (1,362) 411 (951)
Earnings from
equity
investments 718 - 718 490 - 490
------------------------------------------------------
Income (loss)
before income
taxes 878 (3,448) (2,570) 1,311 24,990 26,301

Income tax
expense (1,689) 3 (1,686) (206) - (206)
------------------------------------------------------

Net income
(loss) $ (811) $(3,445) $ (4,256) $ 1,105 $24,990 $ 26,095
------------------------------------------------------
------------------------------------------------------

Earnings
(loss) per
share
- diluted $ (0.01) $(0.05) $ (0.06) $ 0.02 $ 0.34 $ 0.36
------------------------------------------------------
------------------------------------------------------

Weighted
average number
of common
shares
outstanding
- diluted 68,645 68,645 68,645 71,846 71,846 71,846

Note: The AMD segment primarily includes the Company's majority
interest in OccuLogix, Inc. (formerly Vascular Sciences Corp.).


TLC VISION CORPORATION
CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands except per share amounts)

Year Ended Year Ended
December 31, 2005 December 31, 2004
------------------------------------------------------
Results Results
Before Before
AMD AMD Total AMD AMD Total
Segment Segment TLCVision Segment Segment TLCVision
------------------------------------------------------

Revenues:
Refractive:
Centers $ 150,168 $ - $ 150,168 $141,782 $ - $ 141,782
Access 36,453 - 36,453 40,659 - 40,659
Other
healthcare
services 71,563 1,841 73,404 63,969 837 64,806
------------------------------------------------------
Total
revenues 258,184 1,841 260,025 246,410 837 247,247

Cost of
revenues:
Refractive:
Centers 106,476 - 106,476 101,440 - 101,440
Access 26,974 - 26,974 28,863 - 28,863
Other
healthcare
services 43,537 3,738 47,275 39,389 1,046 40,435
------------------------------------------------------
Total cost
of revenues 176,987 3,738 180,725 169,692 1,046 170,738
------------------------------------------------------

Gross profit
(loss) 81,197 (1,897) 79,300 76,718 (209) 76,509
------------------------------------------------------

General and
administrative 27,647 8,850 36,497 26,009 857 26,866
Marketing and
sales 21,055 659 21,714 18,541 164 18,705
Research and
development,
clinical and
regulatory - 5,250 5,250 - 1,825 1,825
Amortization
of intangibles 4,039 - 4,039 4,098 - 4,098
Other expenses,
net 935 (166) 769 940 - 940
------------------------------------------------------
Total
operating
costs 53,676 14,593 68,269 49,588 2,846 52,434
------------------------------------------------------
Operating
income (loss) 27,521 (16,490) 11,031 27,130 (3,055) 24,075

Gain on sale
of OccuLogix,
Inc. stock - - - - 25,792 25,792
Interest income 2,687 1,593 4,280 1,902 52 1,954
Interest
expense (1,737) - (1,737) (2,617) - (2,617)
Minority
interests (8,401) 7,058 (1,343) (7,364) 411 (6,953)
Earnings from
equity
investments 2,545 - 2,545 2,057 - 2,057
------------------------------------------------------
Income (loss)
before income
taxes 22,615 (7,839) 14,776 21,108 23,200 44,308

Income tax
expense (7,891) - (7,891) (600) - (600)
------------------------------------------------------

Net income
(loss) $ 14,724 $ (7,839) $ 6,885 $ 20,508 $23,200 $ 43,708
------------------------------------------------------
------------------------------------------------------

Earnings
(loss) per
share
- diluted $ 0.21 $ (0.11) $ 0.10 $ 0.29 $ 0.32 $ 0.61
------------------------------------------------------
------------------------------------------------------

Weighted
average
number of
common
shares
outstanding
- diluted 71,380 71,380 71,380 71,088 71,088 71,088

Note: The AMD segment primarily includes the Company's majority
interest in OccuLogix, Inc. (formerly Vascular Sciences Corp.).


TLC VISION CORPORATION
CONSOLIDATING BALANCE SHEETS
(In thousands)

December 31, 2005 December 31, 2004
(Unaudited)
------------------------------------------------------------
Results
Results Before
Before AMD AMD
AMD AMD Total Segment Segment Total
Segment Segment TLCVision (Unaudited) (Unaudited) TLCVision
------------------------------------------------------------

ASSETS
Current
assets
Cash
and
cash
equiv-
alents $ 22,122 $ 9,607 $ 31,729 $ 15,847 $ 17,588 $ 33,435
Short-
term
invest-
ments 6,550 31,663 38,213 68,515 42,500 111,015
Accounts
receiv-
able 20,056 527 20,583 16,489 954 17,443
Prepaid
expenses,
inventory
and
other 11,604 5,519 17,123 12,212 1,609 13,821
------------------------------------------------------------
Total
current
assets 60,332 47,316 107,648 113,063 62,651 175,714

Inter-
company 1,693 (1,693) - 1,877 (1,877) -
Restricted
cash 975 - 975 932 - 932
Investments
and other
assets 19,838 - 19,838 10,482 - 10,482
Goodwill 99,402 - 99,402 53,774 - 53,774
Other
intangible
assets 23,886 135 24,021 18,037 103 18,140
Fixed
assets 48,646 513 49,159 45,636 563 46,199
------------------------------------------------------------
Total
assets $254,772 $46,271 $ 301,043 $ 243,801 $ 61,440 $ 305,241
------------------------------------------------------------
------------------------------------------------------------

LIABILITIES
Current
liabilities
Accounts
payable $10,517 $ 514 $ 11,031 $ 8,491 $ 225 $ 8,716
Accrued
liabil-
ities 22,158 2,295 24,453 23,425 3,714 27,139
Current
maturities
of
long-term
debt 5,268 - 5,268 8,664 - 8,664
------------------------------------------------------------
Total
current
liabil-
ities 37,943 2,809 40,752 40,580 3,939 44,519

Long-term
debt,
less
current
matur-
ities 12,665 - 12,665 9,991 - 9,991
Other
long-term
liabil-
ities 3,427 - 3,427 2,242 480 2,722
Minority
inter-
ests 14,284 21,510 35,794 9,307 27,915 37,222
------------------------------------------------------------
Total
liabil-
ities 68,319 24,319 92,638 62,120 32,334 94,454

STOCKHOLDERS'
EQUITY
Common
stock 419,936 30,767 450,703 428,877 30,082 458,959
Option
and
warrant
equity 1,861 - 1,861 2,872 - 2,872
Accumu-
lated
deficit(235,344) (8,815) (244,159) (250,068) (976) (251,044)
------------------------------------------------------------
Total
stock-
holders'
equity 186,453 21,952 208,405 181,681 29,106 210,787
------------------------------------------------------------

Total
liabil-
ities
and
stock-
holders'
equity $254,772 $46,271 $ 301,043 $ 243,801 $ 61,440 $ 305,241
------------------------------------------------------------
------------------------------------------------------------

Note: The AMD segment primarily includes the Company's majority
interest in OccuLogix, Inc. (formerly Vascular Sciences Corp.).


TLC VISION CORPORATION
CONSOLIDATING STATEMENTS OF CASH FLOWS (UNAUDITED)
(In thousands except per share amounts)

Year Ended Year Ended
December 31, 2005 December 31, 2004
------------------------------------------------------
Results Results
Before Before
AMD AMD Total AMD AMD Total
Segment Segment TLCVision Segment Segment TLCVision
------------------------------------------------------

OPERATING
ACTIVITIES
Net income
(loss) $ 14,724 $(7,839) $ 6,885 $ 20,508 $23,200 $ 43,708

Adjustments to
reconcile net
income (loss)
to net cash
from operating
activities:
Depreciation
and
amortization 16,233 120 16,353 17,594 87 17,681

Write-offs
(reimbursements)
of investments
in research
and
development
arrangements (300) - (300) (400) 1,249 849
Minority
interests 8,401 (7,058) 1,343 7,364 (411) 6,953
Earnings from
equity
investments (2,545) - (2,545) (2,057) - (2,057)
Deferred taxes 6,301 - 6,301 - - -
Loss (gain)
on disposals
of fixed assets 75 (167) (92) 839 - 839
Gain on sale
of OccuLogix,
Inc. stock - - - - (25,792) (25,792)
Gain on sales
of subsidiaries (319) - (319) (1,143) - (1,143)
Non-cash
compensation
expense 648 790 1,438 484 - 484
Adjustments to
the fair
values of
intangibles,
long-term
receivables
and long-term
liabilities 888 - 888 (1,206) - (1,206)
Other - 182 182 - - -
Changes in
operating
assets and
liabilities,
net of
acquisitions
and
dispositions: (2,513) (5,095) (7,608) (6,923) 1,967 (4,956)
------------------------------------------------------
Cash from
operating
activities 41,593 (19,067) 22,526 35,060 300 35,360
------------------------------------------------------

INVESTING
ACTIVITIES
Purchases of
fixed assets (8,139) (182) (8,321) (5,103) (88) (5,191)
Proceeds from
sales of
fixed assets 1,494 285 1,779 1,565 - 1,565
Proceeds from
divestitures
of investments
and
subsidiaries,
net 3,430 - 3,430 729 - 729
Proceeds from
sale of
OccuLogix,
Inc. stock, net - - - 25,792 - 25,792
Distributions
and loan
payments
received
from equity
investments 3,039 - 3,039 2,518 - 2,518
Reimbursements
from
(investments
in) research
and
development
arrangements 300 - 300 (849) - (849)
Acquisitions
and equity
investments (67,573) - (67,573) (10,067) - (10,067)
Proceeds from
short-term
investments 91,025 38,725 129,750 8,353 - 8,353
Purchases of
short-term
investments (29,060)(28,035) (57,095) (68,555)(42,500) (111,055)
Other 49 (36) 13 60 - 60
------------------------------------------------------
Cash from
investing
activities (5,435) 10,757 5,322 (45,557)(42,588) (88,145)
------------------------------------------------------

FINANCING
ACTIVITIES
Restricted
cash movement (43) - (43) 444 - 444
Principal
payments of
debt
financing
and capital
leases (9,504) - (9,504) (13,669) - (13,669)
Proceeds from
debt financing 1,992 - 1,992 - - -
Distributions
to minority
interests (8,440) - (8,440) (7,216) - (7,216)
Purchases of
treasury stock (15,868) - (15,868) - - -
Proceeds from
issuances of
common stock 1,980 - 1,980 25,231 - 25,231
Proceeds from
issuances of
OccuLogix, Inc.
stock, net and
cash acquired
upon
consolidation - 329 329 - 59,850 59,850
------------------------------------------------------
Cash from
financing
activities (29,883) 329 (29,554) 4,790 59,850 64,640
------------------------------------------------------

Net increase
(decrease)
in cash and
cash
equivalents
during the
period 6,275 (7,981) (1,706) (5,707) 17,562 11,855
Cash and cash
equivalents,
beginning of
period 15,847 17,588 33,435 21,554 26 21,580
------------------------------------------------------
Cash and cash
equivalents,
end of period $ 22,122 $ 9,607 $ 31,729 $ 15,847 $ 17,588 $ 33,435
------------------------------------------------------
------------------------------------------------------

Operating cash
flow per
diluted share $ 0.58 $ (0.26) $ 0.32 $ 0.49 $ 0.01 $ 0.50

Note: The AMD segment primarily includes the Company's majority
interest in OccuLogix, Inc. (formerly Vascular Sciences Corp.).

TLC Vision Corporation (TSX:TLC) (NASDAQ:TLCV)