ImmuCell Corporation (Nasdaq: ICCC)
(“ImmuCell” or the “Company”), a growing animal health company that
develops, manufactures and markets scientifically-proven and
practical products that improve the health and productivity of
dairy and beef cattle, today announced preliminary, unaudited
product sales results for the first quarter ended March 31, 2020.
Product Sales Results:Total product sales
increased by approximately 11.3%, or $500,000, to approximately
$4.9 million during the quarter ended March 31, 2020 versus last
year’s first quarter, which ended March 31, 2019. Total
product sales increased by approximately 13.6%, or $1.7 million, to
approximately $14.2 million during the trailing twelve-month period
ended March 31, 2020 versus the trailing twelve-month period ended
March 31, 2019. In addition, the Company had a backlog of orders
worth approximately $1.4 million as of March 31, 2020. These
reported figures are preliminary, unaudited estimates and are
subject to change.
This is the Company’s third consecutive quarter of strong sales
growth. Total product sales increased by approximately 24%
during the fourth quarter ended December 31, 2019 and by
approximately 38% during the third quarter ended September 30,
2019, versus the comparable periods during 2018, respectively. This
level of growth indicates strong acceptance of the First
Defense® product line as a tool to help dairy and beef
producers optimize the health and productivity of their newborn
calves.
This consistent sales growth reduced ending inventory as of
March 31, 2020. The Company has estimated that its current annual
production capacity is approximately $18 million. The first
quarter annualized sales rate is approximately 9% over this rate of
production. The current level of demand points to the importance of
the Company’s $3.5 million investment to expand its annual
production capacity to approximately $27 million. This
project is proceeding on budget and on time for anticipated
completion in June, subject to any future COVID-related
interruptions.
Forward-Looking Cautions:The first quarter is
always the seasonal highest for sales, but the Company is uncertain
about its ability to continue this growth rate and meet all
customer demand timely during the second quarter given the current
state of the global pandemic related to COVID-19. As disclosed in a
subsequent event footnote and as a risk factor included in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2019, the Company could experience product shortages, backlogs
and production slowdowns due to difficulties accessing needed
supplies and labor and other restrictions affecting its ability to
consistently deliver its products to market.
The Company will continue to make the health and safety of all
of its personnel the top priority as it navigates this uncharted
territory over the coming weeks and months, while respecting its
role as a nonpublic-facing essential agriculture service in keeping
with government directives and prudent practices being advocated by
health care professionals. Presently, production is
continuing but not at the rate experienced during the first
quarter. This production slowdown is anticipated to have a negative
effect on the Company’s revenues and operating results for the
second quarter of 2020. However, at this point, the Company is
unable to estimate the magnitude of that impact. It is
possible that further interruptions could have consequences that
the Company does not presently recognize, resulting in other
COVID-19 related negative impacts on its business. Because of the
high demand for the First Defense® product line,
the Company’s sales team is contacting major distributors to inform
them of these developments and to work with them to try to meet
their needs and, if necessary, to allocate the available supply
among customers.
The Company is also very concerned about the medium-term impact
that the COVID-19 pandemic may have on the dairy and beef
industries and on its customers. Milk prices, which had
reached new positive levels during the first quarter of 2020, have
crashed recently. There are reports of milk being dumped at farms
due to decreased demand.
Management Discussion:“These top line results
demonstrate the value of our technology in preventing E. coli,
coronavirus and rotavirus infections in newborn calves as well as
the growth potential for our business,” commented Michael F.
Brigham, President and CEO. “We expect to be measured by our
ability to recover from the current pandemic-related challenges and
execute our production capacity expansion plans.”
“To date, the pandemic has not had a material impact on our FDA
development plans for Re-Tain™, a
novel treatment for subclinical mastitis without a milk discard
requirement that provides an alternative to traditional
antibiotics,” Mr. Brigham continued.
About ImmuCell: ImmuCell Corporation's
(Nasdaq: ICCC) purpose is to create
scientifically-proven and practical products that improve the
health and productivity of dairy and beef cattle. ImmuCell
markets First Defense®, providing
Immediate Immunity™ to newborn dairy and beef
livestock, and is in the late stages of developing
Re-Tain™, a novel treatment for subclinical
mastitis, the most significant cause of economic loss to the dairy
industry. The Company expects to file a more detailed press release
covering its first quarter financial results and file its Annual
Report on Form 10-Q on or about May 13, 2020. Interested
parties can access a conference call to be scheduled by the Company
to review the financial results at that time. Investors are
encouraged to review the Company’s updated Corporate Presentation
slide deck that provides an overview of the Company’s business and
is available under the “Investors” tab of the Company’s website at
www.immucell.com, or by request to the Company. Progress photos of
the Company’s investment to expand the production capacity of the
First Defense® product line are now also available
under the “First Defense®” tab of its
website. Press releases and other information about the
Company are available at: http://www.immucell.com.
Cautionary Note Regarding Forward-Looking Statements
(Safe Harbor Statement):
This Press Release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Such statements
include, but are not limited to, any statements relating to: our
plans and strategies for our business; projections of future
financial or operational performance; the timing and outcome of
pending or anticipated applications for regulatory approvals;
factors that may affect the dairy and beef industries and future
demand for our products; the scope and timing of ongoing and future
product development work and commercialization of our products;
future costs of product development efforts; the estimated
prevalence rate of subclinical mastitis; the expected efficacy of
new products; estimates about the market size for our products;
future market share of and revenue generated by current products
and products still in development; our ability to increase
production output and reduce costs of goods sold associated with
our new product, Tri-Shield First
Defense®; the future adequacy of our own manufacturing
facilities or those of third parties with which we have contractual
relationships to meet demand for our products on a timely basis;
the anticipated costs of (or time to complete) planned expansions
of our manufacturing facilities and the adequacy of our funds
available for these projects; the continuing availability to us on
reasonable terms of third-party providers of critical products or
services; the robustness of our manufacturing processes and related
technical issues; estimates about our production capacity,
efficiency and yield; the future adequacy of our working capital
and the availability and cost of third-party financing; future
regulatory requirements relating to our products; future expense
ratios and margins; future compliance with bank debt covenants;
future cost of our variable interest rate exposure on most of our
bank debt; costs associated with sustaining compliance with current
Good Manufacturing Practice (cGMP) regulations in our current
operations and attaining such compliance for the facility to
produce the Nisin Drug Substance; implementation of international
trade tariffs that could reduce the export of dairy products, which
could in turn weaken the price received by our customers for their
products; our effectiveness in competing against competitors within
both our existing and our anticipated product markets; the
cost-effectiveness of additional sales and marketing expenditures
and resources; anticipated changes in our manufacturing
capabilities and efficiencies; the value of our net deferred tax
assets; projections about depreciation expense and its impact on
income for book and tax return purposes; anticipated market
conditions; and any other statements that are not historical facts.
Forward-looking statements can be identified by the use of words
such as “expects”, “may”, “anticipates”, “aims”, “intends”,
“would”, “could”, “should”, “will”, “plans”, “believes”,
“estimates”, “targets”, “projects”, “forecasts”, “seeks” and
similar words and expressions. In addition, there can be no
assurance that future developments affecting us will be those that
we anticipate. Such statements involve risks and uncertainties,
including, but not limited to, those risks and uncertainties
relating to difficulties or delays in development, testing,
regulatory approval, production and marketing of our products
(including the First Defense® product line and
Re-Tain™), competition within our anticipated
product markets, customer acceptance of our new and existing
products, product performance, alignment between our manufacturing
resources and product demand, our reliance upon third parties for
financial support, products and services, changes in laws and
regulations, decision making and delays by regulatory authorities,
currency values and fluctuations and other risks detailed from time
to time in filings we make with the Securities and Exchange
Commission, including our Quarterly Reports on Form 10-Q, our
Annual Reports on Form 10-K and our Current Reports on Form 8-K.
Such statements involve risks and uncertainties and are based on
our current expectations, but actual results may differ materially
due to various factors, including the risk factors summarized
above.
Contacts:
Michael F. Brigham, President and CEO
ImmuCell Corporation
(207)
878-2770
Joe Diaz, Robert Blum and Joe Dorame
Lytham Partners, LLC
(602) 889-9700
iccc@lythampartners.com
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