Quarterly Report (SEC form 10-Q)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITIONS AND RESULTS OF OPERATION FOR MAMMATECH CORPORATION
The second quarter of fiscal 1999 was a period of transition for the Company. Sales revenues increased by 42.3% from the same period a year ago, but declined 50.2% in comparison to the previous quarter. Similarly, gross profit increased 37.6% from the second quarter of 1998, but decreased by 75% in comparison to last quarter. Operating expense during the current quarter relative to the first quarter decreased by 21%, but increased by 16.5% over the second quarter of 1998. The was a small net loss for the quarter due primarily to increased expense associated with expansion of the professional training program (see below).
A similar picture emerges with respect to the six-month figures. Sales revenues declined by 8.79% while operating expense increased by 27.4% compared to the first six months of 1997. The net result for the first half of the year therefore shows a decline of 53.8% compared to the comparable period a year ago.
The decline in sales revenues reported here is attributed to two factors: First, there have been no major purchases by military installations as there were last year. Second, foreign sales are somewhat depressed with absolutely no activity on the part of our
Brazilian distributor. Sales in Germany continue at a stable rate, however. Fortunately, the State of Montana made a major purchase in connection with its BCCP Program funded by the Center for Disease Control.
The Company is focusing substantial effort and resources on strengthening its Professional Training Program. A manuscript describing the major elements of the expanded program was submitted and accepted for Fall publication in a respected medical journal. Also during the quarter, eleven MammaCare Specialists were trained by the new Training Directors who were hired during the first quarter. During the same period last year, five Specialists were trained. Moreover, a number of the individuals trained this year are members of the faculty of academic medical centers, so MammaCare training and product sales might be expected to continue in those settings. There can, of course, be no assurance that such activity will materialize or that substantial revenues to the Company will result.
In spite of a substantial increase in the training fees, bookings for future courses are expanding rapidly. Further expansion of this program is expected as a result of a marketing presence at selected conferences although it remains to be demonstrated that sufficient revenue will result to offset the expense associated with attending such events.
The Company remains essentially debt free and has no immediate liquidity problems. It continues to seek other opportunities to expand its marketing and manufacturing activities to meet the growing world-wide interest in its products. |
