ST. LOUIS, Sept. 4 /PRNewswire-FirstCall/ -- Allied Healthcare Products, Inc. reported that its net income for the fourth quarter ending June 30 fell about 21 percent, from about $870,000 last year, or 11 cents per share, to about $690,000 in the current quarter, or 9 cents per basic share, due to slight delays in manufacturing and higher material and labor costs.
Sales for the fourth quarter increased by about 4.6 percent, or almost $650,000, compared to the fourth quarter of last year. However, Allied sales for the fiscal year tracked very closely with the previous year, totaling about $56.4 million for 2008 and $56.5 million for 2007.
Sales revenue for 2008 included $1.2 million as a result of a 2004 agreement with Abbott Laboratories to reimburse certain Research and Development costs related to new CO2 absorbent techniques. Sales for 2007 included about $584,000 in reimbursement from that agreement. Sales for the fourth quarter of 2008 included $525,000 in reimbursement of Research and Development cost, versus $134,000 for 2007.
For the fiscal year ending June 30, Allied net income fell about 46 percent, from about $1.64 million last year, or 21 cents per basic share, to about $882,000, or 11 cents per share, in 2008.
Manufacturing delays meant that some customer orders were not filled and could not be translated into sales revenue in 2008. Also, material costs -- primarily metals and oil-based resins -- increased by about 2 percent and labor costs by about 3.8 percent over fiscal 2007. A modest overall price increase by Allied could not offset the year's higher material and labor costs.
Manufacturing productivity programs planned for fiscal 2008 were not implemented as quickly as anticipated. However, these programs are proceeding and will result in cost reductions and improved throughput in fiscal 2009, according to Earl Refsland, Allied president and chief executive officer.
Despite problems in the year, positive cash flow of about $2.5 million increased Allied's cash position to about $6.1 million at the end of the fiscal year, Refsland said.
Allied Healthcare Products, Inc. is a leading manufacturer of respiratory care products, medical gas equipment and emergency medical products used in a wide range of alternate care settings.
"SAFE HARBOR" STATEMENT: Statements contained in this release that are not historical facts or information are "forward-looking statements." Words such as "believe," "expect," "intend," "will," "should," and other expressions that indicate future events and trends identify such forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause the outcome and future results of operations and financial condition to be materially different than stated or anticipated based on the forward- looking statements. Such risks and uncertainties include both general economic risks and uncertainties, risks and uncertainties affecting the demand for and economic factors affecting the delivery of health care services, and specific matters which relate directly to the Company's operations and properties as discussed in its periodic filings with the Securities and Exchange Commission. The Company cautions that any forward-looking statement contained in this report reflects only the belief of the Company or its management at the time the statement was made. Although the Company believes such forward-looking statements are based upon reasonable assumptions, such assumptions may ultimately prove inaccurate or incomplete. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement was made.
ALLIED HEALTHCARE PRODUCTS, INC. CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED) Three months ended, Twelve months ended, June 30, June 30, 2008 2007 2008 2007 Net sales $14,692,626 $14,045,798 $56,364,111 $56,500,974 Cost of sales 10,577,599 10,061,519 43,006,007 42,028,125 Gross profit 4,115,027 3,984,279 13,358,104 14,472,849 Selling General and administrative expenses 3,096,161 2,765,157 12,084,971 12,051,500 Income from operations 1,018,866 1,219,122 1,273,133 2,421,349 Interest income (25,245) (28,719) (118,119) (110,790) Other, net 24,501 10,710 60,005 (23,841) (744) (18,009) (58,114) (134,631) Income before provision for income taxes 1,019,610 1,237,131 1,331,247 2,555,980 Provision for income taxes 330,327 368,019 448,748 914,400 Net income $689,283 $869,112 $882,499 $1,641,580 Net income per share - Basic $0.09 $0.11 $0.11 $0.21 Net income per share - Diluted $0.08 $0.11 $0.11 $0.20 Weighted average common shares Outstanding - Basic 7,883,907 7,883,577 7,883,659 7,875,982 Weighted average common shares Outstanding - Diluted 8,124,826 8,111,872 8,119,776 8,085,375 ALLIED HEALTHCARE PRODUCTS, INC. CONSOLIDATED BALANCE SHEET (UNAUDITED) June 30, 2008 June 30, 2007 ASSETS Current assets: Cash and cash equivalents $6,149,015 $3,638,870 Accounts receivable, net of allowances of $300,000 and $460,000, respectively 6,441,683 7,251,767 Inventories, net 12,046,450 12,999,472 Other current assets 394,975 275,254 Total current assets 25,032,123 24,165,363 Property, plant and equipment, net 10,542,573 10,677,000 Goodwill 15,979,830 15,979,830 Other assets, net 703,328 496,127 Total assets $52,257,854 $51,318,320 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $2,590,804 $3,040,313 Other accrued liabilities 2,960,334 2,508,820 Deferred income taxes 500,238 882,001 Deferred revenue 690,000 465,000 Total current liabilities 6,741,376 6,896,134 Deferred revenue 2,177,500 1,937,500 Commitments and contingencies Stockholders' equity: Preferred stock; $0.01 par value; 1,500,000 shares authorized; no shares issued and outstanding - - Series A preferred stock; $0.01 par value; 200,000 shares authorized; no shares issued and outstanding - - Common stock; $0.01 par value; 30,000,000 shares authorized; 10,188,569 and 10,187,069 shares issued at June 30, 2008 and June 30, 2007; respectively. 7,885,077 and 7,883,577 outstanding at June 30, 2008 and June 30, 2007, respectively. 101,886 101,871 Additional paid-in capital 47,524,084 47,441,163 Retained earnings 16,444,436 15,673,080 Less treasury stock, at cost; 2,303,492 shares at June 30, 2008 and June 30, 2007, respectively (20,731,428) (20,731,428) Total stockholders' equity 43,338,978 42,484,686 Total liabilities and stockholders' equity $52,257,854 $51,318,320
