Senetek PLC Announces Results for the Quarter Ended March 31, 2003 And Operating Priorities for 2003
Wednesday May 14, 8:31 pm ET
NAPA, Calif., May 14 /PRNewswire-FirstCall/ -- Senetek PLC (Nasdaq: SNTK - News), www.senetekplc.com , a healthcare technologies company focused on developing and co-marketing products applicable to the anti-aging markets in key skin care/dermatologicals and sexual functions categories worldwide, today announced a net loss for the quarter ended March 31, 2003, of $69,000 or $0.00 per share, compared to net income of $504,000, or $0.01 per share, for the quarter ended March 31, 2002.
Revenues from continuing operations for three months ended March 31, 2003 were $2.1 million, a 17 percent decrease compared to revenues of $2.5 million for the three months ended March 31, 2002. The reduction of revenue was due to reductions in both product sales and royalties. The reduction in product sales was based upon the delays in the timing of customer product launches and resultant delays in placing anticipated product orders. The reduction in royalty revenue was due mainly to a 33 percent reduction in royalties from Revlon resulting from lower than anticipated unit sales and a lower average royalty rate due to the mix of products sold.
While the Company's gross profit percentage continues high and in fact increased to 84.3 percent in the quarter ended March 31, 2003 compared to 83.8 percent for the three month period ended March 31, 2002, the overall gross profit decreased approximately $342,000 during the three months ended March 31, 2003 compared to the three months ended March 31, 2002, due to lower revenues.
The Company's level of operating expenses, research and development plus administration, sales and marketing, increased by approximately 7 percent during the quarter ended March 31, 2003 compared to the three months ended March 31, 2002. The increase in these expenses reflects the Company's continuing commitment to developing and advancing new and existing products for market and investing in its infrastructure to fuel future growth opportunities.
The Company's current ratio (current assets divided by current liabilities) was 3.29 at March 31, 2003, an improvement from the current ratio of 3.18 at December 31, 2002. Cash has increased to $3,708,000 at March 31, 2003, a $136,000 increase from December 31, 2002.
"Although we are disappointed with our lower revenue figures and small loss for the quarter, we are very pleased by the continued strength of our balance sheet and the progress we are making with our existing projects," said Brad Holsworth, CFO.
The Company is continuing to execute against its five key priorities for 2003.
* The Company is actively exploring means to repay its $7.4 million in
secured notes before they would be reclassified as a current liability
in the next Form 10-Q reporting results for the quarter ending June
30, 2003, though the notes do not mature until April 2004.
Alternatives being considered include both possible refinancing of
this debt and repayment with proceeds of possible strategic business
transactions.
* The Company is addressing the complex operational and regulatory
issues encountered as we scale up for commercial production of our
proprietary erectile dysfunction parenteral drug Invicorp. The
Company hopes to launch commercially in Denmark by the fourth quarter
of this year but, as Denmark is our reference state for pan-European
approvals under the Mutual Recognition Program, we intend to take
whatever time is required to assure that all variations to our
original approval by the Danish Medicines Agency which have been
necessitated by commercial scale-up are correct and complete.
Meanwhile, we are concentrating on the commercial launch in New
Zealand, still scheduled for the third quarter, where our distribution
partner is finalizing its marketing plan, packaging and promotional
materials for the launch. We have a search underway for an in-house
regulatory/technical specialist to support these efforts.
* We have concluded that the highest use for our proprietary Reliaject
parenteral drug autoinjector and automated manufacturing equipment is
to partner with a major drug or medical device company that has the
reach to fully exploit this technology's multiple applications. Such
an arrangement would provide at a minimum for a return on our
investment in intellectual property and equipment, profit-sharing or
royalty on commercial applications of the technology, and rights for
the Company to use Reliaject for Invicorp and other drugs of interest
to us. Discussions with several such companies have begun.
* To date in 2003, the Company has signed two Kinetin licenses for the
ethical class of trade in Taiwan, Hong Kong and China and in Greece,
respectively, and negotiations are at an advanced stage for three
additional licenses. These licenses include next generation skincare
products that combine Kinetin with active proprietary dermatologicals
in-licensed by the Company from other licensees, consistent with our
core strategy. Meanwhile we have been working with existing licensees
to expand product offerings and distribution. And we are negotiating
collaborative research and development agreements directed at Kinetin,
Zeatin and various analogues with a key research institute and a major
skincare products company.
* The Company is on track for production of its science-based
educational infomercial promoting Senetek Kinetin Plus, a unique eight
product skincare regimen featuring Kinetin and other high-performance
proprietary active ingredients, scheduled for shooting in mid-June and
media-testing in early August. The infomercial will be coordinated
with print promotion in Sunday supplements and outgoing telemarketing,
and the Company also will be testing this line for sale in and through
high-end spas and estheticians.
The Company will conduct its year-end teleconference call for investors on Thursday, May 15, at 7 a.m. Pacific, 10 a.m. Eastern. The domestic dial-in number is 800/314-7867; international dial-in number is 719/867-0640, confirmation code 127344. Replay numbers are domestic 888/203-1112 and international 719/457-0820, confirmation code for replay is 127344. Mr. Frank J. Massino, Chairman & CEO, and Mr. Holsworth will discuss the quarterly results and the outlook for remainder of 2003.
Visit Senetek PLC's web site: senetekplc.com .
Senetek PLC Investor Relations Contact:
1-707-226-3900 ext. 102
E-Mail: Pknopick@eandecommunications.com
Safe Harbor Statement:
This news release contains statements that may be considered "forward- looking statements" within the meaning of the Private Securities Litigation Reform Act, including the Company's discussion of the launch of its proprietary product line during 2003, expected regulatory approval, debt refinancing or repayment and new license agreements. Forward-looking statements by their nature involve substantial uncertainty, and actual results may differ materially from those expressed in such statements. Important factors identified by the Company that it believes could result in such material differences are described in the Company's Annual Report on Form 10-K for the year 2002. However, the Company necessarily can give no assurance that it has identified all of the factors that may result in any particular forward-looking statement materially differing from actual results, and the Company assumes no obligation to correct or update any forward-looking statements which may prove to be inaccurate, whether as a result of new information, future events or otherwise.
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Source: Senetek PLC |
