ERBA Diagnostics, Inc. Reports Second Quarter 2012 Financial Results
ERBA Diagnostics, Inc.
ERBA Diagnostics, Inc. (NYSE MKT:ERB), a fully integrated in vitro diagnostics company, reports its financial results for the quarter ended June 30, 2012.
Kevin D. Clark, Chief Executive Officer, Chief Operating Officer and President of ERBA Diagnostics, said, “I am pleased to report a continuation in the second quarter of 2012 of the turnaround we are experiencing, with a significant year-over-year reduction in operating loss to almost break-even, resulting from a significant reduction in operating expenses. Our expenses have continued to stabilize in the first half of 2012. We have seen growth in reagent sales throughout the last three quarters. Our cash position has also stabilized with a much lower amount of cash used in operations. Looking ahead into the remainder of 2012, now that we have become much more streamlined, we are continuing to focus on implementing a number of new initiatives in an effort to grow sales and product range, organically as well exploring potential acquisitions, both in the United States and internationally. These efforts are backed by our previously reported stock purchase agreement and warrant with our principal stockholder, ERBA Diagnostics Mannheim GmbH, which has already provided us with $5.45 million of equity funding and which has agreed to provide us with another $10.0 million pursuant to the stock purchase agreement and which has the right to provide us with an additional $14.55 million pursuant to the warrant.”
Net revenues for the second quarter of 2012 were $4,315,000 compared with $4,375,000 in the second quarter of 2011, a decrease of $60,000, or 1.4%. The decrease in revenue was primarily the result of a decrease of $233,000 in instrument sales from domestic operations partially offset by an increase of $173,000 in net revenue from increased instrument sales and contract research and development agreement with ERBA Diagnostics Mannheim from European operations. Net revenue in the six months ended June 30, 2012 increased by $75,000, or 1%, from the same period last year. The increase in revenue for the six month period was primarily driven by the increase in instrument sales and contract research and development agreement with ERBA Diagnostics Mannheim in Europe.
Gross profit for the second quarter of 2012 was $2,204,000, or 51.1% of net revenue, compared with $2,360,000, or 53.9% of net revenue for the second quarter of 2011. Gross profit for the six months ended June 30, 2012 decreased by $148,000, or 3.3%, from the same period last year. The decrease in gross profit resulted from lower sales and the decrease in gross profit margin percentage was primarily driven by a decrease in sales of our proprietary instruments, which have a higher average margin than reagent sales in the United States.
Operating expenses for the second quarter of 2012 decreased compared to the same period of 2011, to $2,340,000 from $3,520,000. Selling expenses decreased mainly due to open sales positions in the United States and, in Italy, reduction in workforce and lower commissions. General and administrative expenses decreased as a result of reduction in workforce, reduction in leased office space and reduction in provision for doubtful accounts. Research and development expenses decreased principally due to reduction of research and development activities in the United States and funding of research and development in Italy.
Loss from operations for the second quarter of 2012 was $136,000 compared with loss from operations of $1,161,000 in the second quarter of 2011. Loss from operation totaled $255,000 for the six months ended June 30, 2012 compared to the loss from operations of $2,168,000 in the same period of 2011. Net loss for the second quarter of 2012 was $359,000, or $0.01 loss per share, compared with a net loss of $767,000, or $0.02 loss per share, in the second quarter of 2011. Net loss for the six months ended June 30, 2012 was $437,000, or $0.01 loss per share, compared to net loss of $1,788,000, or $0.05 loss per share, in the same period of 2011. Comprehensive loss was $474,000 for the second quarter of 2012 compared with comprehensive loss of $736,000 in the second quarter of 2011. Comprehensive loss for the six months ended June 30, 2012 was $471,000 compared to a comprehensive loss of $1,532,000 in the same period of 2011.
ERBA Diagnostics, Inc. (), headquartered in Miami, Florida, is a fully integrated in vitro diagnostics company that develops, manufactures and distributes in the United States and internationally, proprietary diagnostic reagents, test kits and instrumentation, primarily for autoimmune and infectious diseases, through its three subsidiaries: Diamedix Corporation (U.S.), Delta Biologicals S.r.l. (Europe) and ImmunoVision, Inc. (U.S.).