Exhibit 99.1
Sharps Compliance Corp. Announces
Results for the Quarter Ended December 31, 2005;
Company Reports Second Consecutive Quarter of
Strong Revenue Growth and Operating Earnings
HOUSTON--(BUSINESS WIRE)--Jan. 24, 2006--Sharps Compliance Corp. and
subsidiaries (OTCBB:SCOM) ("Sharps" or the "Company"), leading
providers of cost-effective medical waste disposal solutions for
industry and consumers, today announced its operating results for the
second quarter of fiscal year 2006.
Financial Results
For the three-months ended December 31, 2005, the Company reported
revenues of $2.7 million versus revenues for the corresponding quarter
of the prior fiscal year of $2.2 million, an increase of 19%. For the
six-months ended December 31, 2005, the Company generated revenues of
$5.3 million versus revenues for the corresponding quarter of the
prior year of $4.6 million, a 15% increase. The increase in revenues
is attributable to growth in the Retail, Hospitality, Agriculture and
Pharmaceutical markets.
The Company generated gross margins of 44% and 43% for the three
and six months ended December 31, 2005, respectively. The Company's S,
G & A expenses increased by 7% for the six months ended December 31,
2005 when compared to the corresponding period of the prior year. The
increase in the S, G & A is attributable to higher professional fees
and sales-related expenses.
The Company reported net income of $0.2 and $0.3 million for the
quarter and six months ended December 31, 2005, respectively. These
results compare to essentially breakeven results for the quarter ended
December 31, 2004 and net income of $0.1 million for the six months
ended December 31, 2004.
Business Developments
Retail Market
The Company generated billings of approximately $450,000 in the
Retail market during the six-months ended December 31, 2005. These
billings were driven by sales of the Company's Sharps Disposal By Mail
System(R) products to retail pharmacies and grocery stores to support
the proper disposal of syringes used to administer flu shots and other
inoculations. The billings for the six-months ended December 31, 2005
in the Retail market represent an increase of over 110% over the
corresponding prior period billings in this market.
Hospitality Market
The Company generated billings of over $300,000 in the Hospitality
market during the six-months ended December 31, 2005. This level of
billings represents an increase of over 100% as compared to the prior
year six-month period. This growth was driven by an approximate
$100,000 order from one of the nation's largest contract food service
providers for the Company's biohazard spill clean-up kit. This
newly-launched product has an innovative mail-back feature and
contains everything required to safely and properly dispose of medical
waste spills within U.S. Postal Service regulations. The Company is
actively marketing the product to multiple industries and, to date,
has been met with a very positive reception.
Agriculture Market
The Company generated billings of over $350,000 in its Agriculture
market during the six-months ended December 31, 2005. The current
fiscal year billings in this market represent a 50% increase over the
corresponding prior period billings.
Pharmaceutical Market
The Company generated approximately $100,000 in billings in the
Pharmaceutical market during the quarter ended December 31, 2005.
These billings were driven by sales of the Company's Sharps Disposal
By Mail System(R) products utilized to support the proper disposal of
syringes in the pharmaceutical clinical trial setting.
Residential Market
The Company's Sharps Disposal By Mail System(R) has been, or is in
the process of, being implemented as an integral part of the municipal
waste programs of five (5) California cities to date. We are in
discussions with twelve (12) additional municipalities (five (5) in
California and four (4) in Texas) that have expressed interest in
similar programs. Municipal programs are designed to eliminate
needles, syringes and lancets from the public waste stream and assist
self-injecting residents with proper disposal. There are an estimated
3 billion syringes disposed outside of the healthcare setting each
year.
Comments
Regarding the second quarter results, Dr. Burton J. Kunik,
Chairman, Chief Executive Officer and President of Sharps Compliance
Corp. stated, "Consistent with our internal goals, the results
represent the Company's second consecutive quarter of strong growth in
revenue and earnings. The success of our financial performance is a
direct result of our continued push to expand the Company's sales
efforts to new market opportunities. In fact, we have recently
re-aligned our sales force whereby each regional sales director
markets all Company products across multiple market segments within
his or her geographic territory. We believe this approach will
facilitate a more efficient and effective method of successfully
closing the many sales opportunities in the markets served by the
Company.
Kunik added, "We are also pleased to announce the endorsement of
the Company's Sharps Disposal By Mail System(R) by Texas Dental
Association Financial Services, the for-profit affiliate of the Texas
Dental Association ("TDA"). The TDA, chartered in 1871, is the third
largest state dental association in the United States. Currently, the
TDA has more than 7,700 members and is comprised of 26 component
dental societies grouped into four divisions across the state of
Texas. The TDA is affiliated with the American Dental Association, as
its national representative, and its component societies at the local
level".
Headquartered in Houston, Texas, Sharps is a leading developer of
superior solutions for improving safety, efficiency and cost related
to the proper disposal of medical waste by industry and consumers.
Sharps primary markets include healthcare, agriculture, hospitality,
professional, industrial, commercial and retail. The Company's
products and services represent cutting edge solutions for a variety
of industries dealing with the complexity of managing regulatory
compliance, environmental sensitivity, employee and customer safety,
corporate risk and operating costs related to medical waste disposal.
Sharps is a leading proponent and participant in the development of
public awareness and solutions for the safe disposal of needles,
syringes and other sharps in the community setting.
Sharps Compliance Corp. is the exclusive supplier of Sharps
Disposal by Mail systems to the Consumer Health Care division of
Becton, Dickinson and Company. The Company also maintains an exclusive
sales and marketing arrangement with Waste Management, Inc. whereby
Sharps provides safe disposal systems and related services for Waste
Management's residential and commercial customers.
Sharps Compliance Corp.'s common stock trades on the OTC Bulletin
Board under the symbol SCOM.
The information made available in this press release contains
certain forward-looking statements which reflect Sharps Compliance
Corp.'s current view of future events and financial performance.
Wherever used, the words "estimate," "expect," "plan," "anticipate,"
"believe," "may" and similar expressions identify forward-looking
statements. Any such forward-looking statements are subject to risks
and uncertainties and the company's future results of operations could
differ materially from historical results or current expectations.
Some of these risks include, without limitation, the company's ability
to educate its customers, development of public awareness programs to
educate the identified consumer, managing regulatory compliance and/or
other factors that may be described in the company's annual report on
Form 10-KSB, quarterly reports on Form 10-QSB and/or other filings
with the Securities and Exchange Commission. Future economic and
industry trends that could potentially impact revenues and
profitability are difficult to predict. The company assumes no
obligation to publicly update or revise its forward-looking statements
even if experience or future changes make it clear that any projected
results express or implied therein will not be realized.
(Financial Highlights Follow)
SHARPS COMPLIANCE CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended Six Months Ended
December 31, December 31,
------------------------- ------------------------
2005 2004 2005 2004
------------ ------------ ------------ -----------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
------------ ------------ ------------ -----------
REVENUES $2,663,376 $2,229,045 $5,323,488 $4,648,431
COSTS AND EXPENSES:
Cost of revenues 1,496,692 1,330,947 3,057,611 2,718,491
Selling, general
and
administrative 957,484 861,021 1,849,860 1,728,926
Depreciation and
amortization 35,240 40,355 68,104 83,256
------------ ------------ ------------ -----------
Operating income
(loss) 173,960 (3,278) 347,913 117,758
Interest Expense (3,678) (5,364) (7,594) (13,288)
------------ ------------ ------------ -----------
Net Income (loss)
before Income
Taxes $170,282 ($8,642) $340,319 $104,470
------------ ------------ ------------ -----------
Income Taxes (3,310) (493) (8,815) (4,693)
------------ ------------ ------------ -----------
Net Income (Loss) $166,972 ($9,135) $331,504 $99,777
============ ============ ============ ===========
NET INCOME (LOSS)
PER SHARE
Basic $0.02 ($0.00) $0.03 $0.01
============ ============ ============ ===========
Diluted $0.02 ($0.00) $0.03 $0.01
============ ============ ============ ===========
SHARES USED IN
COMPUTING NET
INCOME (LOSS) PER
SHARE
Basic 10,547,311 10,538,144 10,547,311 10,538,144
Diluted 10,698,545 10,538,144 10,709,344 10,869,494
SHARPS COMPLIANCE CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
December 30, June 30,
2005 2005
------------ -----------
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $407,640 $258,427
Restricted cash 10,010 10,010
Accounts receivable, net 1,063,875 964,148
Inventory 423,305 368,495
Prepaid and other assets 134,447 79,320
------------ -----------
Total current assets 2,039,277 1,680,400
Property and equipment, net 450,425 438,064
Intangible assets, net 61,771 11,779
------------ -----------
Total assets $2,551,473 $2,130,243
============ ===========
Liabilities and stockholders' equity (deficit)
Current liabilities:
Accounts payable $485,802 $567,398
Accrued liabilities 386,738 283,953
Current portion of deferred revenue 1,065,495 996,597
Current maturities of capital lease
obligations 52,599 48,558
------------ -----------
Total current liabilities 1,990,634 1,896,506
Long-term deferred revenue 293,585 272,781
Obligations under capital leases, net of
current maturities 14,906 42,112
Other liabilities 64,500 62,500
------------ -----------
Total liabilities 2,363,625 2,273,899
Total stockholders' equity (deficit) 187,848 (143,656)
------------ -----------
Total liabilities and
stockholders' equity (deficit) $2,551,473 $2,130,243
============ ===========
CONTACT: Sharps Compliance Corp.
David P. Tusa, 713-660-3514
dtusa@sharpsinc.com
www.sharpsinc.com