Exhibit 99.1
Lee Pharmaceuticals Announces Year-End Results
Lee Pharmaceuticals (OTC Bulletin Board symbol: LPHM) reported results for the three months and fiscal year ended September 30, 2003, as compared to same periods ended September 30, 2002.
A comparison of the operating results is as follows:
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| Three Months Ended |
| Fiscal Year Ended |
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| 2003 |
| 2002 |
| 2003 |
| 2002 |
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Gross revenues |
| $ | 1,784 |
| $ | 2,534 |
| $ | 9,730 |
| $ | 10,154 |
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Net revenues |
| $ | 1,605 |
| $ | 2,324 |
| $ | 8,758 |
| $ | 9,226 |
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Net (loss) |
| $ | (829 | ) | $ | (746 | ) | $ | (1,104 | ) | $ | (911 | ) |
Current assets |
| $ | 3,431 |
| $ | 4,034 |
| $ | 3,431 |
| $ | 4,034 |
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Current liabilities |
| $ | 6,956 |
| $ | 5,917 |
| $ | 6,956 |
| $ | 5,917 |
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Total assets |
| $ | 6,060 |
| $ | 6,888 |
| $ | 6,060 |
| $ | 6,888 |
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Long-term debt |
| $ | 3,386 |
| $ | 4,284 |
| $ | 3,386 |
| $ | 4,284 |
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Total stockholders’ (deficit) |
| $ | (4,592 | ) | $ | (3,488 | ) | $ | (4,592 | ) | $ | (3,488 | ) |
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Per share: |
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Basic (loss) per share |
| $ | (.20 | ) | $ | (.18 | ) | $ | (.27 | ) | $ | (.22 | ) |
In fiscal 2003, net revenues decreased 5% to $8,758,000 from $9,226,000 in fiscal 2002. The decrease in net revenues was primarily attributed to lower sales volume associated with the Lee® Lip-Ex® lip balm category. In addition, the Company experienced lower volume from controlled substance/prescription drug items, depilatories and various over-the-counter items. The decrease in net revenues was partially offset by higher sales volume generated from the private label segment and newly acquired brands. The Company’s sales returns increased approximately $44,000 or 5% when comparing fiscal years 2003 and 2002. The Company continued to experience the discontinuance of a few of the Company’s SKUs (stock keeping units) at the retail store level. The continued expansion into the private label business segment has been positive.
The Company reported a net loss of $1,104,000, or 27 cents per share, during fiscal year 2003. This compares to a net loss of $911,000, or 22 cents per share, in fiscal year 2002. Contributing to the loss during fiscal year 2003 was product line impairment adjustment ($254,000), an increase in the allowance for obsolete inventory ($150,000) and higher consulting services expense due to expanded analytical testing requirements for many of the Company’s products ($138,000).
The Company reported an increase of $502,000 in other income when comparing fiscal years 2003 and 2002. The significant increase was attributed to realized gains from the sale of three of the Company’s prior
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product line acquisitions ($319,000). Also, the Company earned approximately $153,000 which was the Company’s portion of the net profits from its investment with another drug company and approximately $60,000 from its new distribution agreement with the same company.
Lee Pharmaceuticals is engaged in the purchase, manufacture, and marketing of a range of consumer products, including over-the-counter drug items, health and beauty aids, cosmetics and prescription drug products containing controlled substances, and dental/orthodontic products.
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