Hemagen Reports Net Income for the First Quarter on Increased Sales and Improved Operating Results
14 Février 2006 - 3:26PM
Business Wire
Hemagen Diagnostics, Inc. (OTC:HMGN.OB) a biotechnology company
that develops, manufactures, and markets proprietary medical
diagnostic test kits, today reported operating results for the
first fiscal quarter ended December 31, 2005. For the three-month
period ended December 31, 2005, the Company reported net income of
$122,000 or $0.01 per share, compared to a net loss of $236,000 or
($0.02) per share for the quarter ended December 31, 2004. After
adjusting for non-cash charges including depreciation,
amortization, and non-cash interest, the net income for the quarter
ended December 31, 2005 was $145,000 compared to a net loss of
$103,000 for the quarter ended December 31, 2004. William P. Hales,
President and CEO, said, "This quarter marks the first time the
Company has reported net income since taking over management of the
company. We are pleased with the improvement in sales levels and
continue to strive to make progress in improving our operations.
Our main focus is on increasing revenues through core growth while
continuing to contain costs. We remain focused on our number one
goal of building shareholder value and positioning the company for
sustained profitability. We continue to work to optimize our
manufacturing facilities and improve our operating efficiencies."
Revenues for the quarter ended December 31, 2005 were $1,965,000 as
compared to revenues of $1,778,000 for the quarter ended December
31, 2004, an increase of $187,000 or 10.5%. The increase in sales,
for the three-month period ended December 31, 2005, were mainly due
to the increase in revenue at the Company's Brazilian subsidiary
and at Raichem, the Company's Clinical Chemistry Division. Gross
Margins for the quarter ended December 31, 2005 were 46% of sales,
as compared to 28% for the quarter ended December 31, 2004. Margins
were higher than the previous period due to improved manufacturing
efficiencies and reduced manufacturing spending. At December 31,
2005, Hemagen had working capital of $1,841,000 and a current ratio
of 1.8 to 1.0 compared to working capital of $3,209,000 and a
current ratio of 3.3 to 1.0 at December 31, 2004. This reduction in
working capital is mainly due to the classification of construction
financing which was used to purchase the Company's new headquarters
as a current liability. This liability will be reclassified as a
long-term liability once the construction period is complete. If
this financing had been long term at December 31, 2005, the working
capital of the Company would have been $2,498,000 and the current
ratio would have been 2.4 to 1.0 instead of 1.8 to 1.0. Hemagen had
$278,000 of cash on hand at December 31, 2005, as compared to cash
on hand of $307,000 at December 31, 2004. -0- *T HEMAGEN
DIAGNOSTICS, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF
OPERATIONS (UNAUDITED) Three Months Ended Dec 31, Dec 31,
---------------------- 2005 2004 ---------------------- Revenues
$1,965,000 $1,778,000 Costs and Expenses: Cost of Product sales
1,061,000 1,273,000 Research and development 60,000 62,000 Selling,
general and administrative 582,000 572,000 ----------------------
Operating income (loss) 262,000 (129,000) Other expenses, net
(116,000) (95,000) Income tax expense (24,000) (11,000) Net income
(loss) $122,000 ($235,000) ====================== Net loss per
share-Basic and Diluted $0.01 ($0.02) ======================
RECONCILIATION OF EARNINGS BEFORE NON-CASH CHARGES FOR THE
THREE-MONTH PERIODS ENDED DECEMBER 31, 2005 (UNAUDITED) Three
Months Ended Dec 31, Dec 31, -------------------- 2005 2004
-------------------- Net income (loss) $122,000 ($235,000) Adjusted
for: Depreciation and Amortization 12,000 117,000 Non-cash
amortization of debt discount 15,000 15,000 Other non-cash charges
(4,000) -- -------------------- Net loss before non cash charges
$145,000 ($103,000) ==================== This reconciliation of
Earnings before non-cash charges is presented because the company
believes it is important to see the impact of the non-cash on the
earnings of the company. *T Hemagen Diagnostics, Inc., is a
biotechnology company that develops, manufactures, and markets more
than 150 FDA-cleared proprietary medical diagnostic test kits used
to aid in the diagnosis of certain autoimmune and infectious
diseases. Hemagen also manufactures and markets a complete line of
Clinical Chemistry Reagents through its wholly owned subsidiary
RAICHEM. In addition, Hemagen manufactures and sells the Analyst(R)
an FDA-cleared Clinical Chemistry Analyzer used to measure
important constituents in human and animal blood, and the Endochek,
a clinical chemistry analyzer used to measure important
constituents in animal blood. In the United States, the Company
sells its products directly to physicians, veterinarians, clinical
laboratories and blood banks and on a private-label basis through
multinational distributors of medical supplies. Internationally,
the Company sells its products primarily through distributors. The
Company sells the Analyst(R) and the Endochek both directly and
through distributors servicing physicians' office laboratories and
veterinarians' offices. Hemagen's products are used in many of the
largest Laboratories, Hospitals, and Blood Banks around the world.
Hemagen sells its products to over 1,000 customers worldwide. The
company focuses on markets that offer significant growth
opportunities. The Company was incorporated in 1985 and became a
public company in 1993. Except for any historical information
contained herein, the matters discussed in this press release
contain forward-looking statements that involve risks and
uncertainties, including those described in the Company's
Securities and Exchange Commission Reports and Filings. Certain
Statements contained in this News Bulletin that are not historical
facts constitute forward-looking statements, within the meaning of
the Private Securities Litigation Reform Act of 1995, and are
intended to be covered by the safe harbors created by that Act.
Reliance should not be placed on forward looking statements because
they involve unknown risks, uncertainties and other factors which
may cause actual results, performance or achievements to differ
materially from those expressed or implied. Forward looking
statements may be identified by words such as estimates,
anticipates, projects, plans, expects, intends, believes, should
and similar expressions and by the context in which they are used.
Such statements are based upon current expectations of the Company
and speak only as of the date made. The Company undertakes no
obligation to update any forward-looking statements to reflect
events or circumstances after the date on which they are made.
Statements concerning the establishments of reserves and
adjustments for dated and obsolete products, expected financial
performance, on-going business strategies and possible future
action, which Hemagen intends to pursue to achieve strategic
objectives, constitute forward-looking information. The sufficiency
of such reserves and adjustments, expected performance,
implementation of on-going business strategies and possible future
action, the achievement of financial performance are each subject
to numerous conditions, uncertainties and risk factors. Factors
which could cause actual performance to differ materially from
these forward looking statements, include without limitation,
management's analysis of Hemagen's assets, liabilities and
operations, the failure to sell date sensitive inventory prior to
its expiration, the inability of particular products to support
goodwill allocated to them, competition, new product development by
competitors which could render particular products obsolete, the
inability to develop or acquire and successfully introduce new
products or improvements of existing product costs and difficulties
in complying with laws and regulations administered by the U. S.
Food and Drug Administration and the ability to assimilate
successfully product acquisitions.
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