Retractable Technologies, Inc. (NYSE MKT: RVP) reports the following
results of operations for the twelve months ended December 31, 2015 and
2014, respectively.
Comparison of Year Ended December 31, 2015 and Year Ended December
31, 2014
Domestic sales accounted for 77.9% and 80.1% of the revenues in 2015 and
2014, respectively. Domestic revenues decreased 16.7% principally due to
reduced flu demand. Domestic unit sales decreased 17.6%. Domestic unit
sales were 67.0% of total unit sales for 2015. International revenues
decreased from $6.9 million in 2014 to $6.5 million in 2015, primarily
due to more restrictive qualification requirements by the Company.
Overall unit sales decreased 11.9%. Our international orders may be
subject to significant fluctuation over time. Such orders may fluctuate
due to health initiatives at various times as well as economic
conditions.
Cost of sales decreased $3.3 million principally due to lower volumes.
Royalty expense decreased $251 thousand due to decreased gross sales.
Gross profit margins increased from 34.8% in 2014 to 35.8% in 2015.
Operating expenses decreased 2.9% from the prior year due to decreased
Medical Device Excise Taxes attributable to refunds, lower compensation
costs, and lower travel and entertainment costs.
A non-recurring recognition of $7,724,826 received from BD in the second
quarter of 2015 pursuant to a patent infringement case had a significant
impact on 2015 income. Recognizing this payment also significantly
decreased 2015 current liabilities on the Balance Sheet.
The loss from operations was $3.2 million in 2015 compared to an
operating loss of $2.2 million in 2014.
Earnings per share were positively affected by our acquisition of
200,000 shares of IV Class B convertible preferred stock. This preferred
stock was purchased from a stockholder as of November 30, 2015. The
shareholder was issued 728,000 shares of our Common Stock as
consideration and agreed to waive all unpaid dividends in arrears
associated with the tendered preferred stock, equaling $3.1 million.
Under the guidelines of ASC 260-10-S99-2, Effect on the Calculation
of Earnings per Share for the Redemption or Induced Conversion of
Preferred Stock, we reflected the gain on extinguishment of this
preferred stock in net income per common stockholder used to calculate
earnings per share. This accounting treatment had the effect of
increasing the income applicable to common shareholders by $2.3 million
in 2015 which had a material effect on the determination of earnings per
share. As a result, Basic earnings per share was $0.21 for 2015.
Cash flow from operations was a negative $3.3 million for 2015 due
primarily to the loss from operations and changes in working capital,
namely increased inventories and other current assets, mitigated by a
decrease in Accounts receivable and an increase in Accounts payable.
Further details concerning the results of operations as well as other
matters are available in the Company’s Form 10-K filed on March 30, 2016
with the U.S. Securities and Exchange Commission.
RTI manufactures and markets VanishPoint® and Patient Safe® safety
medical products. The VanishPoint® syringe, blood collection, and IV
catheter products are designed to prevent needlestick injuries and
product reuse by retracting the needle directly from the patient,
effectively reducing exposure to the contaminated needle. Patient Safe®
syringes are uniquely designed to reduce the risk of bloodstream
infections resulting from catheter hub contamination. RTI's products are
distributed by various specialty and general line distributors.
For more information on RTI, visit our website 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 our current views with respect to future events.
We believe that the expectations reflected in such forward-looking
statements are accurate. However, we cannot assure you that such
expectations will materialize. Our actual future performance could
differ materially from such statements.
Factors that could cause or contribute to such differences include, but
are not limited to: our ability to maintain liquidity; our maintenance
of patent protection; the impact of current and future Court decisions
regarding current litigation; our ability to maintain favorable third
party manufacturing and supplier arrangements and relationships; our
ability to quickly increase capacity in response to an increase in
demand; our ability to access the market; our ability to maintain or
lower production costs; our ability to continue to finance research and
development as well as operations and expansion of production; the
impact of larger market players, specifically Becton, Dickinson and
Company, in providing devices to the safety market; and other risks and
uncertainties that are detailed from time to time in RTI's periodic
reports filed with the U.S. Securities and Exchange Commission.
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