Full Press Release Details
RETRACTABLE TECHNOLOGIES, INC. POSTS RECORD 4th QUARTER, FULL-YEAR 2005 SALES AND $316,000 4th QUARTER NET INCOME
LITTLE ELM, TX, April 3, 2006 Retractable Technologies, Inc. (AMEX: RVP), a leading maker of
safety needle devices, today reported net income of $316,000 for the three months ending December 31, 2005 on record sales for the quarter of $7.9 million, compared with a loss of $423,000 in the same 2004 period. These results were due largely
to a 48.5% increase in unit sales over the fourth quarter of 2004, a dramatic improvement in gross profit margins, and higher interest income. For the full-year 2005, Retractable posted record sales of $24.2 million, an increase of 12.6% over the
year before. Unit sales increased 19.1% in 2005.
International sales rose sharply in the three-month period ended December 31, 2005 principally due
to the shipment of a large order received through Retractable s second contract under the Bush Administration s global HIV/AIDS initiative. Revenue growth in 2005 resulted from increased sales in both the domestic and international
markets, including sales made in connection with the global HIV/AIDS program. Sales for the quarter and full-year also include $1.5 million and $3.1 million, respectively, in reimbursed discounts arising from the Company s 2003 legal settlement
with a hospital group purchasing organization.
The diluted loss per share was $0.00 for the fourth quarter, compared with a diluted loss per share of
$0.03 for the same 2004 period. For the twelve-month period ended December 31, 2005 the diluted loss per share was $0.12, compared with $2.08 in diluted earnings per share in 2004. The results for 2004 reflect $74.6 million in litigation
proceeds, including $65.5 million from the settlement of Retractable s federal antitrust lawsuit against Becton Dickinson & Co. (BD).
Operating results, notably gross profit margins, improved dramatically in the fourth quarter and full-year mainly because of higher revenues and lower unit costs. Gross profit margins rose to 42.2% in the fourth quarter from 13.4% in the
same 2004 quarter. For the full-year, the gross profit margin was 36.3%, compared with 23.7% in 2004. The $3.7 million improvement in gross profit and the $1.4 million decrease in operating expenses in 2005 resulted in a reduction of the operating
loss to $2.9 million from $8.0 million in 2004.
Working capital declined slightly from $56.8 million at December 31, 2004 to $56.0 million at
December 31, 2005. Stockholders equity decreased from $63.7 million to $63.2 million in 2005.
Further details are available on our Form 10-K,
which was filed on March 31, 2006 with the Securities and Exchange Commission.
Retractable Technologies, Inc. manufactures and markets
VanishPoint automated retraction safety syringes
and blood collection devices, which virtually eliminate health care worker exposure to accidental needlestick injuries. These revolutionary devices use a patented friction ring mechanism that causes the contaminated needle to retract automatically
from the patient into the barrel of the device, a feature that is designed to prevent reuse. VanishPoint safety needle devices are distributed by various specialty and general line distributors. For more information on Retractable, visit our Web site 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 the
Company s current views with respect to future events. The Company believes that the expectations reflected in such forward-
looking statements are accurate. However, the Company cannot assure you that such expectations will materialize. The
Company s actual future performance could differ materially from such statements. Factors that could cause or contribute to such differences include, but are not limited to: the impact of dramatic increases in demand; the Company s ability
to quickly increase its capacity in the event of a dramatic increase in demand; the Company s ability to access the market; the Company s ability to reduce production costs; the Company s ability to continue to finance research and
development as well as operations and expansion of production; the recently increased interest of larger market players, specifically BD, in providing safety needle devices to their customers; and other risks and uncertainties that are detailed from
time to time in the Company s periodic reports filed with the Securities and Exchange Commission.
RETRACTABLE TECHNOLOGIES, INC.
| December 31, 2005 | December 31, 2004 | |||||
| ASSETS | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 52,513,935 | $ | 55,868,526 | ||
| Accounts receivable, net | 3,404,908 | 1,864,514 | ||||
| Inventories, net | 3,297,726 | 3,778,949 | ||||
| Income taxes receivable | 561,062 | 1,349,144 | ||||
| Current deferred tax asset | 1,245,508 | 1,516,012 | ||||
| Other current assets | 462,150 | 296,683 | ||||
| Total current assets | 61,485,289 | 64,673,828 | ||||
| Property, plant, and equipment, net | 11,925,976 | 11,056,865 | ||||
| Intangible assets, net | 316,926 | 358,659 | ||||
| Other assets | 27,334 | 34,005 | ||||
| Total assets | $ | 73,755,525 | $ | 76,123,357 | ||
| LIABILITIES AND STOCKHOLDERS EQUITY | ||||||
| Current liabilities: | ||||||
| Accounts payable | $ | 2,345,613 | $ | 3,402,037 | ||
| Current portion of long-term debt | 295,417 | 271,842 | ||||
| Accrued compensation | 388,726 | 322,861 | ||||
| Marketing fees payable | 1,419,760 | 1,419,760 | ||||
| Accrued royalties to a shareholder | 540,888 | 504,016 | ||||
| Other accrued liabilities | 467,812 | 118,832 | ||||
| Income taxes payable | 1,813,084 | |||||
| Total current liabilities | 5,458,216 | 7,852,432 | ||||
| Long-term debt, net of current maturities | 4,350,625 | 3,535,410 | ||||
| Long term deferred tax liability | 711,443 | 1,070,810 | ||||
| Total liabilities | 10,520,284 | 12,458,652 | ||||
| Stockholders equity: | ||||||
| Preferred stock $1 par value: | ||||||
| Series I, Class B | 171,000 | 199,400 | ||||
| Series II, Class B | 255,200 | 289,000 | ||||
| Series III, Class B | 135,245 | 137,745 | ||||
| Series IV, Class B | 556,000 | 556,000 | ||||
| Series V, Class B | 1,381,221 | 1,389,971 | ||||
| Common Stock, no par value | ||||||
| Additional paid-in capital | 54,307,053 | 53,424,744 | ||||
| Retained Earnings | 6,429,522 | 7,667,845 | ||||
| Total stockholders equity | 63,235,241 | 63,664,705 | ||||
| Total liabilities and stockholders equity | $ | 73,755,525 | $ | 76,123,357 |
RETRACTABLE TECHNOLOGIES, INC.
STATEMENTS OF OPERATIONS
| Year ended December 31, 2005 | Year ended December 31, 2004 | |||||||
| Sales, net | $ | 21,156,666 | $ | 21,135,943 | ||||
| Reimbursed discounts | 3,078,350 | 385,757 | ||||||
| Total sales | 24,235,016 | 21,521,700 | ||||||
| Cost of sales | ||||||||
| Cost of manufactured product | 13,713,675 | 14,564,404 | ||||||
| Royalty expense to a shareholder | 1,715,024 | 1,846,195 | ||||||
| Total cost of sales | 15,428,699 | 16,410,599 | ||||||
| Gross profit | 8,806,317 | 5,111,101 | ||||||
| Operating expenses: | ||||||||
| Sales and marketing | 4,148,688 | 3,648,454 | ||||||
| Research and development | 934,209 | 626,941 | ||||||
| General and administrative | 6,600,133 | 8,834,527 | ||||||
| Total operating expenses | 11,683,030 | 13,109,922 | ||||||
| Loss from operations | (2,876,713 | ) | (7,998,821 | ) | ||||
| Interest income | 1,372,715 | 475,121 | ||||||
| Interest expense, net | (339,688 | ) | (243,922 | ) | ||||
| Litigation settlements, net | 74,635,362 | |||||||
| Net income (loss) before income taxes | (1,843,686 | ) | 66,867,740 | |||||
| Provision (benefit) for income taxes | (605,363 | ) | 12,176,345 | |||||
| Net income (loss) | (1,238,323 | ) | 54,691,395 | |||||
| Preferred Stock dividend requirements | (1,502,887 | ) | (1,993,516 | ) | ||||
| Earnings (loss) applicable to common shareholders | $ | (2,741,210 | ) | $ | 52,697,879 | |||
| Earnings (loss) per share basic | $ | (0.12 | ) | $ | 2.33 | |||
| Earnings (loss) per share diluted | $ | (0.12 | ) | $ | 2.08 | |||
| Weighted average common shares outstanding | 23,332,277 | 22,600,166 |
Vice President and Chief Financial Officer
(888) 806-2626 or (972) 294-1010
Communications Director
(212) 490-0811 or (214) 912-7415 (cell)