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Retractable Technologies, Inc. Reports 30.1 Percent Increase in Sales in the First Quarter

LITTLE ELM, Texas–May 17, 2006–Retractable Technologies, Inc. (AMEX:RVP), a leading maker of safety needle devices, today reported $5.5 million in total sales for the three months ended March 31, 2006, a 30.1 percent increase over the same period last year. This increase, which boosted gross profit for the quarter to $1.9 million from $1.5 million in the year-ago period, resulted from higher sales in the U.S. market.

Domestic sales increased 36.7 percent while international sales dropped 10.9 percent; combined unit sales for the domestic and international markets rose 16.9 percent. International sales declined in the first quarter of 2006 due to lower shipments under the Bush Administration’s global HIV/AIDS initiative compared with the same period last year. The timing of shipments, and therefore the Company’s recognition of revenues, under this program vary from quarter to quarter depending in part on logistical requirements in Africa and the Caribbean.

Largely because of a 25.3 percent increase in operating expenses, including higher sales and marketing and research and development costs in the quarter, the Company posted an operating loss of $1.2 million. The increase in sales and marketing expense resulted primarily from the hiring of additional sales personnel, whereas the increase in R&D costs was due mainly to consulting expenditures and costs associated with the development of the new VanishPoint® safety intravenous (I.V.) catheter. General and administrative costs also rose because of higher compensation, travel and legal expenses.

The Company’s balance sheet remains strong with cash making up $51.6 million, or 70.6 percent, of total assets. Further details are available on the Company’s Form 10-Q/A filed with the Securities and Exchange Commission.

Retractable Technologies, Inc. manufactures and markets VanishPoint® automated retraction safety syringes and blood collection devices, which virtually eliminate health care worker exposure to accidental needlestick injuries. These revolutionary devices use a patented friction ring mechanism that causes the contaminated needle to retract automatically from the patient into the barrel of the device, a feature that is designed to prevent reuse. VanishPoint® safety needle devices are distributed by various specialty and general line distributors. For more information on Retractable, visit our Web site at www.vanishpoint.com.

Forward-looking statements in this press release are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995 and reflect the Company’s current views with respect to future events. The Company believes that the expectations reflected in such forward-looking statements are accurate. However, the Company cannot assure you that such expectations will materialize.

The Company’s actual future performance could differ materially from such statements. Factors that could cause or contribute to such differences include, but are not limited to: the impact of dramatic increases in demand; the Company’s ability to quickly increase its capacity in the event of a dramatic increase in demand; the Company’s ability to access the market; the Company’s ability to reduce production costs; the Company’s ability to continue to finance research and development as well as operations and expansion of production; the recently increased interest of larger market players, specifically BD, in providing safety needle devices to their customers; and other risks and uncertainties that are detailed from time to time in the Company’s periodic reports filed with the Securities and Exchange Commission.

                                              March 31,
                                                 2006     December 31,
                                             (Unaudited)      2005
                                             ------------ ------------
Current assets:
               Cash and cash equivalents     $51,561,260  $52,513,935
               Accounts receivable, net        2,821,074    3,404,908
               Inventories, net                3,453,737    3,297,726
               Income taxes receivable           916,502      561,062
               Current deferred tax asset      1,135,327    1,245,508
               Other current assets              626,903      462,150
                                              -----------  -----------
                       Total current assets   60,514,803   61,485,289
               Property, plant, and
                equipment, net                12,171,697   11,925,976
               Intangible assets, net            306,512      316,926
               Other assets                       26,075       27,334
                                              -----------  -----------
                       Total assets          $73,019,087  $73,755,525
                                              ===========  ===========
Current liabilities:
               Accounts payable              $ 2,381,387  $ 2,345,613
               Current portion of long-term
                debt                             246,234      295,417
               Accrued compensation              530,508      388,726
               Marketing fees payable          1,419,760    1,419,760
               Accrued royalties to a
                shareholder                      369,228      540,888
               Other accrued liabilities         334,729      467,812
                                              -----------  -----------
                       Total current
                        liabilities            5,281,846    5,458,216
Long-term debt, net of current maturities      4,300,638    4,350,625
Long-term deferred tax liability                 770,717      711,443
                                              -----------  -----------
                       Total liabilities      10,353,201   10,520,284
                                              -----------  -----------
Stockholders' equity:
               Preferred stock $1 par value:
                       Series I, Class B         171,000      171,000
                       Series II, Class B        242,700      255,200
                       Series III, Class B       135,245      135,245
                       Series IV, Class B        556,000      556,000
                       Series V, Class B       1,381,221    1,381,221
               Common Stock, no par value              -            -
               Additional paid-in capital     54,350,136   54,307,053
               Retained Earnings               5,829,584    6,429,522
                                              -----------  -----------
                       Total stockholders'
                        equity                62,665,886   63,235,241
                                              -----------  -----------
                       Total liabilities and
                        stockholders' equity $73,019,087  $73,755,525
                                              ===========  ===========

                                            Three months  Three months
                                                ended        ended
                                              March 31,    March 31,
                                                2006          2005
                                             ------------ ------------
Sales, net                                   $ 3,881,805  $ 4,063,874
Reimbursed discounts                           1,640,925      180,300
                                              -----------  -----------
             Total sales                       5,522,730    4,244,174
                                              -----------  -----------
Cost of sales
        Cost of manufactured product           3,241,962    2,417,016
        Royalty expense to a shareholder         369,228      314,619
                                              -----------  -----------
             Total cost of sales               3,611,190    2,731,635
                                              -----------  -----------
Gross profit                                   1,911,540    1,512,539
                                              -----------  -----------
Operating expenses:
        Sales and marketing                    1,113,006      940,383
        Research and development                 315,195      119,094
        General and administrative             1,723,771    1,455,782
                                              -----------  -----------
             Total operating expenses          3,151,972    2,515,259
                                              -----------  -----------
             Loss from operations             (1,240,432)  (1,002,720)
Interest income                                  462,197      252,139
Interest expense, net                           (110,707)     (62,413)
                                              -----------  -----------
Net loss before income taxes                    (888,942)    (812,994)
Provision (benefit) for income taxes            (289,004)    (290,059)
                                              -----------  -----------
        Net loss                                (599,938)    (522,935)
Preferred Stock dividend requirements           (367,078)    (381,345)
                                              -----------  -----------
Loss applicable to common shareholders       $  (967,016) $  (904,280)
                                              ===========  ===========
Loss per share - basic and diluted           $     (0.04) $     (0.04)
                                              ===========  ===========
Weighted average common shares outstanding    23,521,551   23,203,665
                                              ===========  ===========

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