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QUEST MEDICAL INC. ANNOUNCES FIRST QUARTER RESULTS

 DALLAS, May 17 /PRNewswire/ -- Quest Medical Inc. (NASDAQ: QMED), a manufacturer of proprietary disposable products for the health care industry, announced today that net earnings for the first quarter ended March 31, 1993, were $221,000, or $.04 per share, compared to net earnings of $410,000, or $.08 per share, for the first quarter of 1992. Revenue was $3,302,000 vs. $3,292,000 for the prior year.
 President Thomas C. Thompson said that sluggish first quarter revenue growth primarily reflected a one-time change in inventory stocking policy by a major customer. He said that slightly lower- than-expected revenue and manufacturing output reduced overhead absorption and gross profit for the period.
 "Development of our proprietary myocardial protection system to protect the heart during open heart surgery is progressing as planned, supported by an increase in expenditures on research and development," Thompson said. He noted that marketing expenses also increased as anticipated in the first quarter to promote the company's expanded product line, while general and administrative expenses were unchanged from the prior year.
 Thompson also announced that on May 13, 1993, Quest entered into a settlement agreement relating to its litigation against Kirschner Medical Corp. and certain related parties. Quest will receive $600,000 in cash and 100,000 shares of Kirschner Medical warrants exercisable for three years at an exercise price of $6 per share. The company incurred litigation expense of approximately $195,000. Thompson said that this settlement will be reflected in Quest's second quarter results.
 Quest Medical Inc. develops, manufactures, and markets proprietary disposable products used in cardiovascular surgery, oncology, anesthesiology, and obstetrics.
 QUEST MEDICAL INC.
 Consolidated Statement of Operations
 (Unaudited)
 Three Months Ended
 March 31,
 1993 1992
 Net revenue $3,302,000 $3,292,000
 Cost of revenue 1,733,000 1,636,000
 Gross profit 1,569,000 1,656,000
 Operating expenses:
 General and administrative 619,000 611,000
 Marketing 462,000 363,000
 Research & development 322,000 276,000
 Total 1,403,000 1,250,000
 Earnings from operations 166,000 406,000
 Other income (expenses):
 Interest expense (21,000) (33,000)
 Gain (loss) on sale of
 marketable securities 51,000 (7,000)
 Gain on sale
 of product assets 5,000 ---
 Interest and other income 107,000 123,000
 Total 142,000 82,000
 Earnings before income taxes 308,000 89,000
 Income taxes:
 Current expense 87,000 78,000
 Net earnings $221,000 $410,000
 Earnings per common and
 common equivalent share: $.04 $.08
 Weighted average number of
 common and common equivalent
 shares outstanding: 5,473,777 5,438,756
 -0- 5/17/93
 /CONTACT: F. Robert Merrill III, VP/Finance of Quest Medical, 214-387-2740/
 (QMED)


CO: Quest Medical Inc. ST: Texas IN: MTC SU: ERN

JB -- LA019 -- 9198 05/17/93 12:16 EDT
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Publication:PR Newswire
Date:May 17, 1993
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