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ENVIRONMENTAL DIAGNOSTICS, INC. ANNOUNCES FIRST QUARTER RESULTS

 ENVIRONMENTAL DIAGNOSTICS, INC. ANNOUNCES FIRST QUARTER RESULTS
 BURLINGTON, N.C., May 15 /PRNewswire/ -- Environmental Diagnostics, Inc. (NASDAQ: EDIT) reported today its operating results for the quarter ended March 31, 1992.
 The Company's revenues for the quarter were $733,911, a decrease of 8 percent from the $795,702 reported in the first quarter of 1991. The Company's net loss was $262,930 or a loss of $.08 per share, compared to a net loss of $96,592 or a loss of $.04 per share in the same quarter of the prior year.
 James D. Skinner, EDI President and C.E.O., said, "Our first quarter results are somewhat disappointing. EDI continues to make progress with its EZ-SCREEN on-site drugs of abuse business. Unit sales of these products has increased 50 percent in the first quarter of 1992 as compared to the quarter ending Dec. 31, 1991 and increased 51 percent as compared to the first quarter of 1991 during which substantial stocking orders were shipped as a result of the very important Texas contract awarded last year. However, significant price erosion resulted from the need to meet strong competitive pricing pressure as well as increased sales and marketing expenses relating to the growing base of business and pursuit of new drug testing business opportunities. In this regard, we are very pleased to announce that Mr. Jeff Konecke has joined EDI as Sales and Marketing Manager. Jeff has been responsible for the design and implementation of drug testing programs for criminal justice through his position at the Center for Law and Justice, the Council for State Governors and the American Probation and Parole Association. Jeff's appointment recognizes our growing business, our stature within the criminal justice system and our commitment to the long term revenue and profit prospects of on-site drug testing."
 During the first quarter, EDI successfully recruited a number of leading researchers and scientists to staff the recent contracts awarded to EDI by Farnam Companies for the development and supply of veterinary diagnostics products and the United States Department of Defense for the development of on-site tests for certain biological agents. With these individuals now on board and the projects in full swing, we anticipate increased contract revenue to off-set research and development expenses.
 The Company has also been successful in soliciting and being awarded O.E.M. manufacturing contracts. This strategy was pursued in order to more fully utilize the Company's state-of-the-art automated and semi-automated manufacturing systems. These increasing revenues and gross margins will help to off-set the negative impact of the loss, last year, of a large contract for the Company's old, conventional biological diagnostic products. The Company has anticipated the loss of these products to major competitors who are focused on this business. Nonetheless, the impact of the loss of this contract on the first quarter was a decrease in product sales of approximately $50,000.
 On April 30, 1992, the Company completed a public offering whereby the exercise of certain outstanding warrants was reduced to $4.60 per share if exercised on or before April 30, 1992. As a result of the exercises of warrants, the Company issued 221,170 shares and obtained gross proceeds of $1,107,000.
 Environmental Diagnostic, Inc. is an emerging, biodiagnostic company with patented technology for the performance of rapid, on-site immunoassays including one-step assays. The Company currently has products on market or research and development and supply agreements that address the human/clinical, drugs of abuse, U.S. Department of Defense tests for biological substances, veterinary and agridiagnostics and food safety testing markets.
 ENVIRONMENTAL DIAGNOSTICS, INC.
 STATEMENTS OF OPERATIONS
 (Unaudited)
 Quarters Ending March 31
 1992 1991
 Revenues $ 733,911 $ 795,702
 Cost of Goods Sold 470,664 476,129
 Gross Profit 263,247 319,573
 Operating Expenses 526,177 416,165
 Net Loss ($262,930) ($ 96,592)
 Loss Per Share of
 Common Stock ($.08) ($.04)
 Weighted Average of Shares
 of Common Stock Outstanding 3,204,465 2,416,002
 -0- 5/15/92
 /CONTACT: Peter Heath, Vice President Finance and Chief Financial Officer, Environmental Diagnostics, Inc., 919-226-6311/
 (EDIT) CO: Environmental Diagnostics, Inc. ST: North Carolina IN: MTC SU: ERN


DF-CM -- CH009 -- 0767 05/15/92 12:57 EDT
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Publication:PR Newswire
Date:May 15, 1992
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