Full Press Release Details
Technologies, Inc. Reports 77% Gross Profit Increase for Q3 2010
ELM, Texas, December 2, 2010 Retractable Technologies, Inc. ( Retractable )
(NYSE AMEX: RVP), a leading maker of safety medical devices, reported a gross
profit of $5.2 million for the three months ended September 30, 2010, a
77.1% increase over its gross profit for the three months ended September 30,
2009. Retractable also reported a gross
profit of more than $11.4 million for the nine months ended September 30,
2010, a 76.4% increase over the nine months ended September 30, 2009.
Comparison of Three Months Ended September 30, 2010 and
sales accounted for 80.1% and 84.8% of the net sales for the three months ended
September 30, 2010 and 2009, respectively. Domestic revenues
increased 7.5% principally due to higher average sales prices.
International revenues increased 48.8% due primarily to higher volumes.
Overall, unit sales increased 2.7%. Domestic unit sales decreased 8.9%,
which may be attributable to a reduction in flu vaccine being
administered. International unit sales increased 38.4%, which may be due
to the lower international sales last year due to increased domestic demand by
the Department of Health and Human Services during the same period.
profit increased primarily due to higher revenues and lower unit manufacturing
costs. The average cost of manufactured product sold per unit decreased
by 15.8% due to lower piece part prices due to increasing our molding
operations at the Little Elm facility and a significant increase in the number
of units produced, thereby reducing the unit costs attributable to fixed
costs. 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
21.9% due to higher gross revenue.
expenses decreased 35.5%. The decrease was due to lower litigation costs
and lower stock option expense, mitigated by amounts paid to employees who had
a salary reduction last year. The lower litigation costs are the result
of an agreement between us and our counsel to cap certain litigation
fees. This is the first quarter that the full effect of the agreement is
income was $1.0 million compared to an operating loss for the same period last
year of $3.5 million.
settlements, net reflect certain provisions of our settlement with Abbott
Laboratories ( Abbott ) and Hospira, Inc. ( Hospira ) pursuant to which we
received a payment of $6.0 million. In addition, Abbott waived a $1.4
million marketing fee and an invoice due from Abbott to us was waived.
Comparison of Nine Months Ended September 30, 2010 and
sales accounted for 87.0% and 83.6% of the net sales for the nine months ended
September 30, 2010 and 2009, respectively. Domestic revenues
increased 34.7% principally due to higher average sales prices.
International revenues increased 2.2% due primarily to higher average
prices. Overall, unit sales increased 14.2%. Domestic unit sales
increased 21.7%, which may be attributable to flu season purchases earlier in
the year. International unit sales decreased 6.2%.
profit increased primarily due to higher revenues and lower unit manufacturing
costs. The average cost of manufactured product sold per unit decreased
by 6.3% due to lower piece part prices due to increasing our molding operations
at the Little Elm facility and a significant increase in the number of units
produced, thereby reducing the unit costs attributable to fixed costs.
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 28.1% due to
higher gross revenue.
Operating expenses decreased 7.1%. The
decrease was due to lower litigation costs and lower salary levels, along with
reduced travel and entertainment, consulting, and marketing expense.
These reductions were mitigated by amounts paid to those employees who had a
salary reduction last year. The lower litigation costs are the result of
an agreement between us and our counsel to cap certain litigation fees.
from operations decreased 59.5% due principally to increased gross profit and
settlements, net reflect certain provisions of our settlement with Abbott and
Hospira pursuant to which we received a payment of $6.0 million. In
addition, Abbott waived a $1.4 million marketing fee and an invoice due from
Abbott to us was waived.
Further details concerning the results of operations
as well as other matters are available in the Company s Form 10-Q filed on
November 15, 2010 with the U.S. Securities and Exchange Commission.
Retractable manufactures and markets safety medical
products, principally VanishPoint automated
retraction safety syringes, automated retraction blood collection devices, and
automated retraction IV catheters, that virtually eliminate healthcare worker
exposure to accidental needlestick injuries. These revolutionary devices use
patented technology that causes the contaminated needle to retract
automatically, a feature that is designed to prevent both accidental
needlestick injury and device reuse. Retractable also manufactures and markets
Patient Safe syringes that are uniquely designed to reduce
the risk of bloodstream infections resulting from catheter hub contamination.
Patient Safe syringes
unique luer guard reduces the risk of luer tip contact contamination and the
risk of contamination of intravenous fluid. Retractable s products are
distributed by various specialty and general line distributors. For more
information on Retractable, visit our 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 our current views with respect to future events.
We believe that the expectations reflected in such forward-looking statements
are accurate. However, we cannot assure you that such expectations will
materialize. Our actual future performance could differ materially from such
Factors that could cause or contribute to such
differences include, but are not limited to: our ability to maintain liquidity;
our maintenance of patent protection; the impact of current litigation; our
ability to maintain favorable supplier arrangements and relationships; our
ability to quickly increase capacity in response to an increase in demand; our
ability to access the market; our ability to maintain or lower production
costs; our ability to continue to finance research and development as well as
operations and expansion of production; the increased interest 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