American Bio Medica Reports Record Financial Results; Second Quarter Net Profit Driven by Nearly Five-fold Increase in Sales.

HUDSON, N.Y.--(BW HealthWire)--Dec. 15, 1998--American Bio Medica Corporation (NASDAQ:ABMC) today announced the unaudited results for the three and six months ended October 31, 1998.

Revenues for the second quarter fiscal 1999 rose nearly five-fold to $1,773,000 from $359,000 for the same period last year. Cost of sales was $722,000 in the three months ended October 31, 1998 as compared to $124,000 for the second quarter in the previous year. Gross profit margin was 59.3% for the second quarter fiscal 1999 with total gross profit of $1,051,000, up from $235,000 in the same quarter last year.

Selling, general, and administrative expenditures relative to revenues decreased 98.9 percentage points to a total of $953,000 in the second quarter fiscal 1999 versus $548,000 for the comparable period last year. Research and development expenses of $52,000 in the quarter ended October 31, 1998 were dedicated to developing new products and improving the drug testing delivery system to further reduce costs. Net income was $9,000, or $.00 per share, for the second quarter fiscal 1999 as compared to $(356,000), or $(.03) per share, for the same three months in the previous year.

Revenues for the six months ended October 31, 1998 were $3,081,000, up more than three-fold from $1,025,000 for the comparable period last year. Cost of sales relative to revenues dropped 8.1 percentage points to a total of $1,236,000 in the first half of fiscal 1999 versus $494,000 for the same six months of the previous year. Gross profit rose from $531,000 in the six months ended October 31, 1997 to $1,845,000 in the first half of fiscal 1999, representing gross profit margin of 59.9%.

Selling, general, and administrative expenses were $1,984,000 in the first six months of fiscal 1999 as compared to $996,000 for the same period in the previous year. Research and development expenditures were $103,000 for the six months ended October 31, 1998. There were no research and development costs in the first half of fiscal 1998. Net income improved to $(268,000), or $(.03) per share, in the first half of fiscal 1999 from $(1,133,000), or $(.08) per share, for the same six month period last year.

As of October 31, 1998, the Company had $3,025,000 in cash and receivables, working capital of $4,013,000, and total stockholders' equity of $4,607,000.

"I am very pleased to report that we met our goal, as stated at the shareholders' meeting in September, of achieving a break-even in the second quarter fiscal 1999," said ABMC President and CEO Stan Cipkowski. "This represents a turning point in our corporate history as we move forward with profitability growth expected over the next two quarters based on anticipated demand through our expanded agreement with Abbott Labs, our success in penetrating the corrections market, and our aggressive global distribution network."

During the second quarter fiscal 1999, the Company received FDA marketing clearance for its low volume 8 panel Rapid Drug Screen(tm). The Company also signed a new distributor to introduce the Rapid Drug Screen as the first on-site drug test in Russia, received an order to supply drug treatment centers in five major Hungarian hospitals, and reported product approval by the Mexican Ministry of Transportation.

Subsequent to the quarter ended October 31, 1998, the Company signed an expanded global distribution agreement with Abbott Laboratories (NYSE:ABT) which sells in more than 130 countries worldwide. The Company also announced two new distributors to target corporate and government marketplaces in Colombia as well as workplace, correctional, health, occupational, and educational markets in Texas. Also following the close of the second quarter fiscal 1999, the Company reported contracts to supply its Rapid Drug Screen products to several corrections jurisdictions within South Carolina and Maine.

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                   AMERICAN BIO MEDICA CORPORATION
                            BALANCE SHEET

                                October 31, 1998      April 30, 1998
                                  Unaudited               Audited

Total current assets            $5,187,000              $4,966,000
Total assets                    $5,781,000              $5,356,000
Total current liabilities       $1,174,000                $486,000
Total stockholders' equity      $4,607,000              $4,870,000

                   AMERICAN BIO MEDICA CORPORATION
                       STATEMENT OF OPERATIONS

         For the three    For the three   For the six    For the six
         months ended     months ended    months ended   months ended
         Oct. 31, 1998    Oct. 31, 1997   Oct. 31, 1998  Oct. 31, 1997
         Unaudited        Unaudited       Unaudited      Unaudited

Revenues     $1,773,000      $359,000        $3,081,000     $1,025,000
Gross
 profit      $1,051,000      $235,000        $1,845,000       $531,000
Net
 income(loss)    $9,000     $(356,000)        $(268,000)  $(1,133,000)
Net
 income (loss)
 per share         $.00         $(.03)            $(.03)        $(.08)
Weighted average
 shares
 outstanding 14,346,669    13,718,265        14,346,669     13,718,265

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As usual, the Company will conduct an investor relations conference call to discuss the earnings on Wednesday December 16, 1998 at 12:00 p.m. EST. Individuals interested in taking part in the call should dial 800-526-7151 before 11:50 a.m. EST on the day of the call and ask to be connected to the ABMC conference.

American Bio Medica Corporation develops, manufactures, and markets inexpensive, accurate, on-site drugs of abuse diagnostic kits and support services worldwide. The Company's global distributors target the workplace, clinical, rehabilitation, physicians, corrections, and educational markets. ABMC's Rapid Drug Screen is proven to correlate 100% with the standard laboratory screening test.

Forward-looking statements in this release are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act 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 reports filed with the Securities and Exchange Commission.