ChemTrak Reports Results for First Quarter 1998
SUNNYVALE, Calif.--(BUSINESS WIRE)--April 20, 1998--ChemTrak Inc. (Nasdaq:CMTR - news), Monday reported product revenues for the first quarter 1998 were $1,054,000, an increase of 73.4 percent, or $446,000 from the $608,000 reported in first quarter a year ago.
Total revenues were $1,054,000, down from $1,441,000 in the first quarter 1997. Net loss from operations for the first quarter 1998 was $1,662,000, compared with a net loss from operations of $1,295,000 in the first quarter 1997.
The increased loss for the first quarter and reduction in total revenues is due primarily to the cessation of revenues from funded research which represented revenues of $833,000 in the first quarter 1997.
Net loss for the first quarter 1998 was $2,100,000, or 15 cents per share, after allowing for the effect of an accretion of $438,000 related to the issuance of preferred stock, compared with a net loss of $1,295,000, or 11 cents per share, in the first quarter of 1997.
The rise in product revenues reflects increased sales of CholesTrak Home Cholesterol Test and the introduction of new products to ChemTrak's line of consumer-diagnostic products during 1997, including ColoCARE Home Test to Detect the Early Warning Signs of Colorectal Disease and initial sales of Parent's Alert Home Drug Test Service.
Cost of products sold rose to $941,000 in first quarter 1998 from $704,000 in first quarter 1997, primarily as a result of increased production levels. Increased advertising expenses associated with the rollout of new consumer products and supporting existing products resulted in an increase in marketing expenses to $975,000 in first quarter 1998, compared with $816,000 in the same period last year.
Research and development expenses continued to be reduced reflecting completion of the company's two product platforms and the lower cost of extending these platforms into a full line of consumer- diagnostic tests.
''We are pleased to report that first quarter product revenues were a record since the reorientation of the company and our decision in 1996 to convert from an R&D-focused company to a market-driven consumer-medical-products company,'' said Edward F. Covell, president and chief executive officer.
''First-quarter revenues were enhanced by our broader product line. We reported solid sales for each product reflecting the growing strength of CholesTrak and ColoCARE and increased stocking order sales of Parent's Alert. CholesTrak sales were also assisted by the start of our 1998 radio advertising campaign and the withdrawal from the market of a competing product,'' he continued.
''Also during the quarter, another major chain, RiteAid, began stocking Parent's Alert, increasing the number of chain drug stores stocking Parent's Alert to more than 10,000,'' Covell said.
''We began testing direct response television advertising for Parent's Alert during the first quarter and plan to roll out our national direct response advertising later this summer. Taken together, we believe these marketing efforts will continue to have a positive effect on revenues later this year,'' he added.
ChemTrak's products for home use are available at all major chain drug and mass merchant outlets, and include Parent's Alert Home Drug Test Service, a counselor-supported home-drug-test service committed to helping parents prevent and eliminate drug use by their children; the CholesTrak Home Cholesterol Test; and the ColoCARE Home Test to Detect the Early Warning Signs of Colorectal Disease.
ChemTrak is in the process of evaluating several potential distributors to the physicians office laboratory market for AccuMeter H. Pylori Test to determine the presence of bacterium associated with duodenal and peptic ulcers and the ChemTrak AccuMeter Theophylline Test, a point-of-care quantitative assay for theophylline, a drug commonly used for the treatment of asthma.
Located in Sunnyvale, ChemTrak is a medical-diagnostics company offering reliable and easy-to-use medical-testing systems for in-home use and use in doctors' offices. ChemTrak medical tests are designed to screen and diagnose health conditions with accuracy comparable to laboratory tests.
The statements in this release regarding future growth and market opportunities are forward-looking and subject to risk and uncertainty, and future results could differ materially from past performance. For a detailed discussion of factors that may affect the company's operating results, interested parties should review the company's Securities and Exchange Commission reports, including the ChemTrak Inc. Form 10-Q for the quarter ended March 31, 1998, as well as the Annual Report on Form 10-K for the year ended Dec. 31, 1997, filed with the SEC.
CHEMTRAK INC.
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