American Bio Medica Announces Fiscal 2000 Results; Sales increase, Gross Margin Improves, Patent Infringement Affects Earnings.Business Editors KINDERHOOK, N.Y.--(BUSINESS WIRE)--Aug. 11, 2000 American Bio Medica medica (māˑ·dē·k Corp. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ABMC ABMC American Battle Monuments Commission ABMC Alexian Brothers Medical Center (Illinois) ABMC Aviation Battle Management Concept ABMC Arrowbear Music Camp (California) ), which develops, manufactures and markets drugs-of-abuse diagnostic kits, sprays and support services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services , today reported results for the year ended April 30, 2000. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight of drug test kits were $7,653,000 for fiscal 2000, compared to $6,499,000 for the previous year, an increase of $1,154,000 or %17.8. Within Fiscal 2000, the Company discontinued its book division enabling them to focus their entire efforts on the marketing of the Rapid Drug Screen(TM). Total sales for Fiscal 1999 included 539,000 of revenue from the book division while Fiscal 2000 had no revenue from the book division. Total sales increased from $7,038,000 in the previous year to $7,653,000 in Fiscal 2000, or 8.7%. Net loss from operations increased to $2,136,000 for fiscal 2000, compared to a loss of $1,691,000 for fiscal 1999. The percentage increase in sales was significantly less than the 226% increase achieved last year. The Company believes this to be a direct result of knock-off products in the market that infringe on ABMC patents. Relative to sales, selling, general, and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. decreased from 71.6% in Fiscal 1999 to 68.2% in Fiscal 2000. SG&A increased 3.6% to $5,223,000 for fiscal 2000 from $5,040,000 the previous year. The Company attributes the increase to legal fees, which increased to $951,000, or 12.4% of net sales, in fiscal 2000 compared to $489,000, or 6.9% of sales, in fiscal 1999. The increase in legal fees was due primarily to patent-infringement lawsuits filed against a former supplier and certain former distributors for production and sale of a knock-off of ABMC's Rapid Drug Screen on-site test for drugs of abuse. ABMC has won preliminary decisions, but the main issues have not yet been litigated. Research and development expense increased in Fiscal 2000 to $799,000 compared to $336,00 for the previous year. The increase represents the Company's continued efforts to enhance product performance and improve methods to reduce the cost of manufacturing its drug test kits. The Company also completed the production of the tricyclic antidepressants Antidepressants, Tricyclic Definition Tricyclic antidepressants are medicines that relieve mental depression. Purpose Since their discovery in the 1950s, tricyclic antidepressants have been used to treat mental depression. (TCA TCA 1. trichloroacetic acid. 2. tricarboxylic acid cycle (Krebs cycle). TCA Tricyclic antidepressant, see there ) test strip included in the Company's 9 panel Rapid Drug Screen. "It has been a difficult year for us with the current patent litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. but feel it is imperative that we defend our intellectual property rights," said American Bio Medica Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Stan Cipkowski. "We are confident that the company's successful prosecution of these lawsuits will result in a significant increase in the company's sales revenues and earnings. We also expect to fully recover legal fees and lost earnings upon successful completion of this litigation." Cipkowski also added, "We are extremely pleased with our R&D efforts over the past year. This enabled us to improve our gross margin to 60% in the fourth quarter. We continue to provide the market with a product of superior quality." He went on to add, "The completion of the development program for the TCA drug testing strip was a major event for ABMC. As one of a very few companies that can offer this option in the clinical market, we expect to see revenue from this product in the new fiscal year." The company anticipates a boost in sales due to the introduction of its non-invasive Drug Detector(TM) wipe-and-spray test for marijuana and cocaine that will be sold by drug stores across the country. Drug Detector was received with excitement when introduced at a chain-drug-store trade show in the spring. ABMC also has filed with the FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. for retail sales of Rapid Drug Screen and has launched a major marketing effort for it in Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. . Cipkowski noted, "Our sales growth has resumed in this new year as we are reclaiming sales lost to the knock-offs in our core markets with our superior products. Add on the anticipated sales from the new 9 panel for the clinical market and the over the counter sales with Drug Detector and we are once again on track and increasing shareholder value."
Condensed Balance Sheet
As of April 30, 2000 As of April 30, 1999
-------------------- --------------------
ASSETS
Cash & equivalents $ 1,207,000 $ 131,000
Total current assets $ 3,809,000 $ 3,802,000
Total assets $ 5,038,000 $ 4,435,000
LIABILITIES & STOCKHOLDERS' EQUITY
Total current liabilities $ 1,793,000 $ 1,415,000
Total liabilities $ 1,827,000 $ 1,462,000
Total stockholders' equity $ 5,038,000 $ 2,973,000
Condensed Statement of Operations
For the Year Ended For the Year Ended
April 30, 2000 April 30, 1999
-------------- --------------
Net sales $ 7,653,000 $ 7,038,000
Cost of goods sold $ 3,602,000 $ 3,356,000
Gross profit $ 4,051,000 $ 3,682,000
Total operating expenses $ 6,128,000 $ 5,401,000
Net income (loss) $ (2,136,000) $(1,691,000)
Basic and diluted net income (loss)
per common share $ (0.15) $ (0.15)
Weighted average shares outstanding
- basic and diluted 15,480,790 14,557,369
American Bio Medica Corporation develops, manufactures and markets inexpensive, accurate on-site drugs-of-abuse diagnostic kits, sprays and support services worldwide. The company's global distributors target the workplace, physicians, corrections, clinical and educational markets. ABMC's Drug Detector identifies minute traces of illegal drugs on surfaces, while the company's Rapid Drug Screen tests Andy Warhol's Screen Tests consist of several-minute unbroken shots of Factory regulars, Warhol superstars, guests, friends, or anyone he thought has "star potential". Warhol would place them in a booth, and tell them to stare at the camera and not blink. individuals and is proven to correlate 100% with the standard laboratory screening test. Forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. in this release are made pursuant to the "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Investors are cautioned that such forward-looking statements involve risk and uncertainties, including without limitation, continued acceptance of the Company's products, increased levels of competition for the Company, new products and technological changes, the Company's dependence on third-party suppliers, intellectual property rights, and other risks detailed from time to time in the Company's periodic report filed with the Securities and Exchange Commission |
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