Retractable Technologies, Inc. Reports Operating Income and Increased Sales for Second Quarter 2019
August 15 2019 - 1:51PM
Business Wire
Retractable Technologies, Inc. (NYSE American: RVP) reports that
its operating income was $329 thousand in the second quarter of
2019, compared to an operating loss for the same period last year
of $939 thousand, and that overall unit sales for the second
quarter of 2019 increased 31.3% over same period in the prior
year.
Retractable also reports the following results of operations for
the three and six months ended June 30, 2019 and 2018,
respectively.
Comparison of Three Months Ended June 30, 2019
and June 30, 2018
Domestic sales accounted for 83.2% and 84.6% of the revenues,
excluding product licensing fees, for the three months ended June
30, 2019 and 2018, respectively. Domestic revenues increased 24.2%
principally due to the increase in units sold. Domestic unit sales
increased 30.1%. Domestic unit sales were 78.7% of total unit sales
for the three months ended June 30, 2019. International revenue and
unit sales increased 36.9% and 35.8%, respectively, due to
increased demand. International orders may be subject to
significant fluctuation over time and there is limited
predictability with respect to the timing of international orders.
Overall unit sales increased 31.3%.
The Cost of manufactured product increased by 21.4% principally
due to higher volume sales. 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 36.4% due to increased
gross sales and product licensing fees. The Company recognized $163
thousand in product licensing fees in the second quarter of 2019.
Such licensing fees are subject to a 50% royalty to Mr. Thomas Shaw
under the terms of his Technology License Agreement.
Gross profit increased 41.7% primarily due to higher net
revenues.
Operating expenses decreased 13.4%. The decrease was due to cost
cutting measures implemented in the fourth quarter of 2018. The
cost cutting measures included a decrease in payroll costs
initiated in November of 2018, as well as a reduction in legal
expenses.
Operating income was $329 thousand compared to an operating loss
for the same period last year of $939 thousand due primarily to
higher net revenues and lower operating expenses.
Interest and other income increased $75 thousand for the quarter
ended June 30, 2019 compared to the same period last year due to
the recognition of unrealized gains on investments and accrued
interest on deposits.
Comparison of Six Months Ended June 30, 2019
and June 30, 2018
Domestic sales accounted for 80.5% and 85.3% of the revenues,
excluding product licensing fees, for the six months ended June 30,
2019 and 2018, respectively. Domestic revenues increased 8.3%
principally due to an increase in units sold. Domestic unit sales
increased 15.7%. Domestic unit sales were 74.6% of total unit sales
for the six months ended June 30, 2019. International revenue and
unit sales increased 51.2% and 40.6%, respectively, due to
increased demand. International orders may be subject to
significant fluctuation over time and there is limited
predictability with respect to the timing of international orders.
Overall unit sales increased 21.2%.
The Cost of manufactured product increased by 18.0% principally
due to an increase in units sold. 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 21.4% due
to increased gross sales and product licensing fees. The Company
recognized $163 thousand in product licensing fees in the first six
months of 2019. Such licensing fees are subject to a 50% royalty to
Mr. Shaw under the terms of his Technology License Agreement.
Gross profit increased 10.0% primarily due to higher net
revenues.
Operating expenses decreased 12.5%. The decrease was due to cost
cutting measures implemented in the fourth quarter of 2018. The
cost cutting measures included a decrease in payroll costs
initiated in November of 2018, as well as a reduction in legal
expenses.
Operating income was $154 thousand compared to an operating loss
for the same period last year of $1.1 million due primarily to
higher net revenues and lower operating expenses.
Interest and other income for the first six months of 2019
increased $139 thousand over the first six months of 2018. This is
a result of the increase in the unrealized value of investments and
accrued interest on deposits.
Further details concerning the results of operations as well as
other matters are available in Retractable's Form 10-Q filed on
August 14, 2019 with the U.S. Securities and Exchange
Commission.
ABOUT RETRACTABLE
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 prefilled 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.retractable.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: potential tariffs, Retractable's
ability to maintain liquidity; Retractable's maintenance of patent
protection; Retractable's ability to maintain favorable third party
manufacturing and supplier arrangements and relationships; foreign
trade risk; 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 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: https://www.businesswire.com/news/home/20190815005591/en/
Retractable Technologies, Inc. John W. Fort III, 888-806-2626 or
972-294-1010 Vice President, Chief Financial Officer, and Chief
Accounting Officer
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