Cholestech Announces First Quarter Results.

HAYWARD, Calif.--(BUSINESS WIRE)--July 24, 1996--Cholestech Corporation (NASDAQ: CTEC) announced today net product sales for the first quarter of fiscal 1997 ended June 28, 1996, were $2,760,000, an increase of 102% from the $1,369,000 reported in the first quarter of the prior year.

Domestic product sales increased $1,403,000 (131%) to $2,473,000 from $1,070,000 in the first quarter of fiscal 1996, and international product sales remained relatively constant compared to the first quarter of fiscal 1996. Other financial highlights reported were a positive gross profit for the quarter of $1,117,000 compared to $491,000 in the prior year.

Commenting on the results, Warren E. Pinckert II, president and chief executive officer, said: "This quarter was marked by three significant milestones for Cholestech. On June 28th we completed a public offering of common stock, raising approximately $13 million to use primarily for repayment of existing debt, funding development of new tests to add to our Cholestech L.D.X System and expansion of manufacturing capacity. In mid-April we launched our CLIA waived product line into the physician office laboratory market, utilizing the 700 person sales force of Physician Sales and Service, Inc. (NASDAQ: PSSI) and in May we entered into a co-development and marketing agreement with Metra Biosystems, Inc. (NASDAQ: MTRA) to develop a test cassette for our System to measure bone resorption (an indication of osteoporosis).

"Our strong sales growth this quarter is a result of our launch into the physician office laboratory market and of continued strong growth in the health promotion market. With the proceeds of our public offering, we believe Cholestech has the resources to develop and deliver some exciting new diagnostic tests in the areas of osteoporosis, diabetes management and prostate cancer."

Continuing, Pinckert said, "Although we expect sales to increase in the second quarter compared to the prior year, historically second quarter sales have been weaker than the first quarter due to a decrease in customer buying patterns related to reduced demand for screenings in the summer months and vacations in July and August."

This press release contains forward-looking statements based upon current expectations. Actual results could differ materially from those indicated in the forward-looking statements as a result of several factors, including the Cholestech L.D.X System's ability to achieve a significant degree of market acceptance among healthcare providers, the Company's ability to complete development of and successfully introduce new tests designed to extend the System's capabilities, the Company's ability to achieve acceptable manufacturing yields of test cassettes, competitive factors and other factors outlined in the Company's Registration Statement on Form S-1 and prospectus dated June 28, 1996, constituting a part thereof.

Cholestech Corporation is a leading manufacturer of point-of-care screening and monitoring diagnostic systems. Cholestech is uniquely positioned to benefit from the increasing emphasis on preventive health care and disease management programs in the United States. Cholestech's portfolio of CLIA waived products is designed to offer efficient and economic screening and monitoring options that will ultimately enable people to lead longer, healthier and more active lives. -0-

                     Cholestech Corporation
                     Statement of Operations
             (In thousands, except per share amounts)
                          (Unaudited)

                                        Thirteen weeks ended
                                       6/28/96        6/30/95
Net sales
   Domestic                            $2,473          $1,070
   International                          287             299
                                        2,760           1,369

Cost of product sales                   1,643             878
Gross profit (loss)                     1,117             491
Operating expenses
   Research and development               184             224
   Sales and marketing                    906             669
   General and administrative             415             354
Total operating expenses                1,505           1,247
Loss from operations                     (388)           (756)

Interest income/(expense), net            (23)             85

Net loss                              $  (411)        $  (671)

Net loss per share                     $(0.05)         $(0.08)

Weighted average number of
   shares outstanding               8,161,721       8,000,632

CONTACT: Cholestech Corp.

Lola Moenich, 510/293-8096 (Investor Relations)