Retractable Technologies, Inc. (NYSE MKT: RVP) reports the
following results of operations for the three and six months ended
June 30, 2016 and 2015, respectively.
Comparison of Three Months Ended June 30, 2016
and June 30, 2015
Domestic sales accounted for 91.7% and 80.9% of the revenues for
the three months ended June 30, 2016 and 2015, respectively.
Domestic revenues increased 27.8% principally due to increased
syringe sales and initial sales of our EasyPoint™ needle and a
slightly higher average price. Domestic unit sales increased 40.5%.
Domestic unit sales were 89.7% of total unit sales for the three
months ended June 30, 2016. International revenue and unit sales
decreased 50.7% and 62.0%, respectively, due to timing of purchases
by a major international customer. Our international orders may be
subject to significant fluctuation over time. Overall unit sales
increased 10.0%.
Gross profit increased 0.7% primarily due to higher revenues
reduced by higher manufacturing costs.
The Cost of manufactured product increased by 20.2% due to
increased sales volumes and increased unit cost of manufacture due
to fewer units manufactured. Profit margins can fluctuate depending
upon, among other things, the cost of manufactured product and the
capitalized cost of product recorded in inventory, as well as
product sales mix. Royalty expense increased 22.3% due to higher
gross sales.
Operating expenses decreased 16.1% or $617 thousand. The
decrease was due to lower costs of compensation, donations of
product, various professional fees, suspension of the Medical
Device Excise Tax, and travel and entertainment. These decreases
were somewhat offset by higher fees paid to distributors and Group
Purchasing Organizations.
A non-recurring recognition of $7,724,826 received from BD had a
significant impact on second quarter 2015 income.
Our operating loss was $605 thousand compared to an operating
loss for the same period last year of $1.2 million due primarily to
reduced operating expenses.
Our effective tax rate on the net earnings (loss) before income
taxes was (0.1)% and negligible for the three months ended June 30,
2016 and June 30, 2015, respectively.
Comparison of Six Months Ended June 30, 2016
and June 30, 2015
Domestic sales accounted for 92.2% and 87.4% of the revenues for
the six months ended June 30, 2016 and 2015, respectively. Domestic
revenues increased 10.4% principally due to increased syringe sales
and initial sales of our EasyPoint™ needle. Average selling price
was slightly lower. Domestic unit sales increased 19.5%. Domestic
unit sales were 90.1% of total unit sales for the six months ended
June 30, 2016. International revenue and unit sales decreased 35.4%
and 48.5%, respectively, due to timing of purchases by a major
international customer. Our international orders may be subject to
significant fluctuation over time. Overall unit sales increased
5.7%.
Gross profit decreased 3.8% primarily due to higher cost of
manufacture.
The Cost of manufactured product increased 10.0% due to higher
sales volumes and increased unit cost due to fewer units
manufactured. Profit margins can fluctuate depending upon, among
other things, the cost of manufactured product and the capitalized
cost of product recorded in inventory, as well as product sales
mix. Royalty expense increased 10.4% due to higher gross sales.
Operating expenses decreased 11.6% or $827 thousand. The
decrease was due to lower costs of compensation, donations of
product, various professional fees, suspension of the Medical
Device Excise Tax, and travel and entertainment. These decreases
were somewhat offset by higher fees paid to distributors and Group
Purchasing Organizations.
A non-recurring recognition of $7,724,826 received from BD
pursuant to the patent infringement portion of a case discussed
above had a significant impact on income for the six months ended
June 30, 2015.
Our operating loss was $1.5 million compared to an operating
loss for the same period last year of $2.1 million due primarily to
lower operating expenses reduced by a decrease in gross profit.
Our effective tax rate on the net earnings (loss) before income
taxes was (0.1)% and 0.1% for the six months ended June 30, 2016
and June 30, 2015, respectively.
Our balance sheet remains strong with cash making up 41.8% of
total assets. Working capital was $21.2 million at June 30, 2016, a
decrease of $1.5 million from December 31, 2015.
Approximately $507 thousand in cash flow in the six months ended
June 30, 2016 was used by operating activities. Cash provided by
working capital items was $564 thousand.
Further details concerning the results of operations as well as
other matters are available in Retractable's Form 10-Q filed on
August 16, 2016 with the U.S. Securities and Exchange
Commission.
Retractable manufactures and markets VanishPoint® and Patient
Safe® safety medical products and the EasyPoint™ needle. The
VanishPoint® syringe, blood collection, and IV catheter products
are designed to prevent needlestick injuries and product reuse by
retracting the needle directly from the patient, effectively
reducing exposure to the contaminated needle. Patient Safe®
syringes are uniquely designed to reduce the risk of bloodstream
infections resulting from catheter hub contamination. The
EasyPoint™ is a retractable needle that can be used with luer lock
syringes, luer slip syringes, and prefill syringes to give
injections. The EasyPoint™ needle also can be used to aspirate
fluids and for blood collection. Retractable's products are
distributed by various specialty and general line distributors.
For more information on Retractable, visit its website at
www.vanishpoint.com.
Forward-looking statements in this press release are made
pursuant to the safe harbor provision of the Private Securities
Litigation Reform Act of 1995 and reflect Retractable's current
views with respect to future events. Retractable believes that the
expectations reflected in such forward-looking statements are
accurate. However, Retractable cannot assure you that such
expectations will materialize. Actual future performance could
differ materially from such statements.
Factors that could cause or contribute to such differences
include, but are not limited to: Retractable's ability to maintain
liquidity; Retractable's maintenance of patent protection; the
impact of current and future Court decisions regarding current
litigation; Retractable's ability to maintain favorable third party
manufacturing and supplier arrangements and relationships;
Retractable's ability to quickly increase capacity in response to
an increase in demand; Retractable's ability to access the market;
Retractable's ability to maintain or lower production costs;
Retractable's ability to continue to finance research and
development as well as operations and expansion of production; the
impact of larger market players, specifically Becton, Dickinson and
Company, in providing devices to the safety market; and other risks
and uncertainties that are detailed from time to time in
Retractable's periodic reports filed with the U.S. Securities and
Exchange Commission.
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version on businesswire.com: http://www.businesswire.com/news/home/20160816006196/en/
Retractable Technologies, Inc.Douglas W. Cowan, 888-806-2626 or
972-294-1010Vice President and Chief Financial Officer
Retractable Technologies (AMEX:RVP)
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