CANTON, Mass., Aug. 14 /PRNewswire-FirstCall/ -- Avitar, Inc. (Amex: - ) today reported financial results for its second fiscal quarter ended June 30, 2003.
Revenues for the third quarter of fiscal 2003 were $1.4 million compared to revenues of $2.2 million for the third quarter of fiscal 2002. The Company intends to continue its efforts to expand revenues because it believes that a significant opportunity exists for its ORALscreen products in the drugs-of- abuse testing market. The third quarter 2003 net loss of $1.1 million, or $0.01 per share, was less than the loss of $1.2 million, or $0.03 per share, for the third quarter 2002.
Revenues for the nine months ended June 30, 2003 were $4.7 million compared to revenues of $7.7 million for the corresponding period of fiscal 2002 (which included approximately $2.0 million of purchases by a major customer to fulfill the initial terms of its agreement with Avitar). The net loss for the nine months ended June 30, 2003 was $3.2 million, or $0.05 per share before the cumulative effect of a change in accounting principle related to goodwill compared to the net loss of $2.8 million, or $0.07 per share, for the nine months ended June 30, 2002. The net loss for the nine months ended June 30, 2003 after the cumulative effect of a change in accounting principle for goodwill was $3.8 million, or $.06 per share.
"Our revenues this Quarter remained similar to the previous quarter primarily due to a difficult capital market which has adversely affected our ability to acquire the growth capital that we need," said Peter P. Phildius, CEO. "As recently announced, however, we have raised part of our capital requirements and are pleased that we were able to do so with significantly less dilution than was anticipated in the financing plan approved by our shareholders at our recent Annual Shareholders Meeting. On an equal dollar basis, the reduction in dilution amounted to 9.2 million shares."
Mr. Phildius continued, "Also, during our Third Fiscal Quarter, our cost reduction programs in SG&A and R&D continued to have a positive impact with significant improvement over the same quarter of FY2002 as well as the previous quarter of 2003. Our cost of sales was, however, adversely impacted by certain inventory adjustments. We feel good that our cost structure now has lowered our breakeven point without negatively impacting our ability to take advantage of the opportunity in the drugs-of-abuse market. We will continue to work to secure the necessary capital, which will enable us to apply the required resources to grow our business."
Avitar, Inc. develops, manufactures and markets innovative and proprietary products in the oral fluid diagnostic market, disease and clinical testing market, and customized polyurethane applications used in the wound dressing industry. Oral fluid diagnostics includes the estimated $1.5 billion drugs-of- abuse testing market, which encompasses the corporate workplace and criminal justice markets. Avitar's products include ORALscreen(TM), the world's first non-invasive, rapid, onsite oral fluid test for drugs-of-abuse, and HAIRscreen(TM), a laboratory-based hair test for detecting long-term drug abuse. Additionally, Avitar manufactures and markets HYDRASORB(TM), an absorbent topical dressing for moderate to heavy exudating wounds. For more information, see Avitar's website at avitarinc.com.
Safe Harbor Statement. This release contains forward looking statements that are subject to risks and uncertainties including financing risks and the development and marketing of new applications and other risks that are detailed from time to time in the Company's filings with the Securities and Exchange Commission. In view of such risks and uncertainties, the Company's actual results could differ materially from those anticipated in such forward looking statements.
Avitar, Inc.
Summary of Financial Results
(in thousands, except per share amounts)
Quarter Ended June 30, Nine Months Ended June 30,
2003 2002 2003 2002
Sales $1,424 $2,233 $4,714 $7,707
Operating Expenses:
Cost of Sales 1,163 1,274 3,297 4,421
Selling,
General and
Administrative 985 1,692 3,519 4,800
Research and
Development 154 334 664 1,001
Amortization of
Goodwill - 77 - 232
Total Operating
Expenses 2,302 3,377 7,480 10,454
Operating Loss (878) (1,144) (2,766) (2,747)
Other Income
(Expenses) (183) (9) (387) (29)
Net Loss Before
Cummulative Effect
of a Change in
Accounting
Principal $(1,061) $(1,153) $(3,153) $(2,776)
Cummulative Effect of
a Change in
Accounting
Principal for
Goodwill - - (650) -
Net Loss $(1,060) $(1,153) $(3,803) $(2,776)
Basic and Diluted
Loss Per Share
before cumulative
effect of a change
in accounting
principle $(0.01) $(0.03) $(0.05) $(0.07)
Basic and Diluted
Loss Per Share
after cumulative
effect of a change
in accounting
principle $(0.01) $(0.03) $(0.06) $(0.07)
Weighted Average
Number of Shares
and Common
Equivalent
Shares
Outstanding 73,130,567 44,605,933 63,228,778 42,006,575
Selected Balance
Sheet Items:
06/30/2003 09/30/2002
Cash 181 503
Total Assets 3,316 5,142
Total
Liabilities 4,734 5,012
Shareholders'
Equity (1,418) 131
COMPANY CONTACT:
Avitar, Inc.
Jay Leatherman
avitarinc.com
