Full Press Release Details
Female Health Company
First Quarter Operating Results, as Gross Profit Margins Widen on Increasing
Sales of FC2 Female Condom
Reaffirms Guidance Anticipating Record FY2009
Illinois -- February 10, 2009 -- The Female Health Company (NYSE Alternext:
which manufactures and markets the FC and
FC2 Female Condoms , today
reported its operating results for the first quarter of FY2009.
unit sales increased during the three months ended December 31, 2008, the
Company's net revenues decreased 7% to approximately $5.3 million, compared with
approximately $5.7 million in the first quarter of the previous fiscal
year. The decline in revenues reflects a continuing shift in product
shipments towards the Company's FC2 Female Condom , which is
priced lower and generates a higher gross profit margin than FC1. In addition,
unit sales have been temporarily limited by a significant increase in orders
FC1, our first generation product, by customers requiring final FDA approval
order FC2. At times, the increased demand has exceeded our capacity
to produce FC1. We elected not to invest in expanding FC1 production
capacity in anticipation of securing FC2 FDA approval, discontinuing FC1 and
investment in expanding FC2 production capacity. Given final FDA
approval, it is anticipated that these customers will purchase FC2, eliminating
this temporary limitation.
Company's net income attributable to common shareholders increased 98% to
$1,608,816, or $0.06 per diluted share, during the first quarter of FY2009,
compared with net income attributable to common shareholders of $813,968, or
$0.03 per share, in the corresponding period of the previous fiscal
year. The Company was positively impacted by the strengthening of the
U.S. dollar relative to the British pound sterling in the first quarter of
FY2009, resulting in a foreign currency gain of $1,194,107, compared with a
currency gain of $115,358 in the first quarter of FY2008.
profit increased 3% to $2,441,194 in the most recent quarter, compared with
$2,366,116 in the first quarter of FY2008. Gross profit as a
percentage of revenue totaled 45.7% in the first quarter of FY2009, versus
in first quarter of FY2008. Operating income decreased to $438,935,
from $729,645 in the three months ended December 31, 2007,
due to significant one-time expenses related to the Company's preparation for,
and participation in, the FDA OB/GYN Device Advisory Committee hearing on
December 11, 2008. Other expense increases included
compensation costs; and Sarbanes Oxley internal control review
in previous news releases, the Company expects significant quarter-to-quarter
variations in its operating results, due to the timing of large order receipts,
production scheduling, and shipping of products.
pleased with first quarter results, which were consistent with management's
expectations," noted O.B. Parrish, Chief Executive Officer of The Female Health
Company. "The increasing acceptance of our second-generation FC2 Female Condom and its
favorable impact on our profitability is particularly encouraging. We
ended the first quarter with a strong, debt-free balance sheet, approximately
$3.2 million of cash in the bank, and a current ratio of
event of greatest significance during our first quarter occurred in December,
when the FDA's OB/GYN Advisory Panel voted unanimously to recommend approval of
labeling specifies the type of clinical study on which the approval was
based. We are presently working through labeling details with the FDA
for final approval, which will allow us to market FC2 in the United States
to provide it to the U.S. Agency for International Development (USAID), one
our largest customers."
reaffirming our annual guidance for FY 2009 that unit sales should increase
to 25% and that operating earnings should rise 50% to 75% from last year's
record levels," concluded Parish.
previously announced, the Female Health Company will host an investor conference
call at 11:00 a.m. EST today, February 10, 2009. Shareholders and
other interested parties may participate in the conference call by dialing
800-860-2442 (international participants dial 412-858-4600) and asking to be
connected to "The Female Health Company Conference Call", a few minutes before
11:00 a.m. EST on February 10, 2009. A replay of the call will be
available one hour after the call through 5:00 p.m. EST on February 24, 2009
dialing 877-344-7529 (international callers dial 412-317-0088) and entering
conference ID 427502.
Female Health Company, based in Chicago, Illinois, manufactures and markets
(FC1) and the FC2 Female Condom (FC2), which are primarily distributed by public
health organizations and donor groups in over 90 developing countries around
world. Globally, the Female Condoms are available in various programs in 116
countries. The Company owns certain worldwide rights to the FC Female Condom , including
patents that have beenissued in the United States, United
Kingdom, Japan, France, Italy, Germany, Spain, the European Patent Convention,
the People's Republic of China, Canada, South Korea and Australia. FC Female Condom is the only
available FDA-approved product controlled by a woman that offers dual protection
against sexually transmitted diseases, including HIV/AIDS, and unintended
information about the Female Health Company visit the Company's web site at
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Harbor" statement under the Private Securities Litigation Reform Act of
statements in this release which are not historical fact are "forward-looking
statements" as that term is defined in the Private Securities Litigation Reform
Act of 1995. Forward-looking statements in this release include the
Company's financial guidance for fiscal 2009. These statements are
based upon the Company's current plans and strategies, and reflect the Company's
current assessment of the risks and uncertainties related to its business,
are made as of the date of this release. The Company assumes no
obligation to update any forward-looking statements contained in this release
a result of new information or future events, developments or
circumstances. Such forward-looking statements are inherently subject
to known and unknown risks and uncertainties. The Company's actual
results and future developments could differ materially from the results or
developments express in, or implied by, these forward-looking
statements. Factors that may cause actual results to differ
materially from those contemplated by such forward-looking statements include,
but are not limited to, the following: product demand and market
acceptance; competition in the Company's markets and the risk of new