Carrington Laboratories, Inc. Reports Third Quarter 2007 Results

IRVING, Texas, Nov. 27 /PRNewswire-FirstCall/ -- Carrington Laboratories, Inc. today reported revenue for the quarter ended September 30, 2007 of $6.5 million, compared to $6.7 million in the year-ago period, as the Company discontinued certain unprofitable or marginally profitable products during the third quarter of the current year. However, the revenue in the quarter just ended, was 16 percent higher than the $5.6 million revenue reported for the second quarter of 2007, the second consecutive quarter-to-quarter revenue gain this year.

Medical Services revenue for the third quarter of 2007, at $1.9 million, was down from the year-ago level of $2.3 million. Consumer Services revenue grew 5 percent for the quarter, to $3.8 million from $3.6 million in the year-ago period. Grant income received for funding of research for the Company's wholly-owned drug delivery subsidiary, DelSite Biotechnologies, Inc., decreased by 4 percent for the quarter, to $776,000 from $811,000 a year ago.

Net loss for the third quarter of 2007, including $524,000 of net funding of DelSite, was $2.2 million, or 21 cents per basic and diluted share, an increase of $485,000 from the net loss reported for the year-ago quarter of $1.7 million, or 16 cents per basic and diluted share. Pro forma loss for the quarter, exclusive of DelSite net funding, was $1.7 million compared to a $1.1 million pro forma loss in the prior-year period.

"We continue on the road to bringing growth and profitability to our core business," said Carlton E. Turner, PhD, Carrington's CEO. "Our product revenue and margins improved again this quarter as we grew our more profitable product lines and reduced our overall operating costs."

Commenting on DelSite, Dr. Turner stated, "We continue to focus our strategy on building the clinical foundation of the GelSite(R) polymer drug delivery and adjuvant technologies and on moving them toward commercial introduction. We are seeing increasing interest from both commercial companies and government health agencies in our vaccine and therapeutic delivery systems for both nasal and injectible formulations. In addition, we continue on the path toward filing an IND and conducting a Phase I clinical study in early 2008 of the GelVac(TM) nasal powder influenza H5N1 (bird flu) vaccine."

Conference Call Scheduled

Investors are invited to listen to the conference call scheduled on Tuesday, November 27, 2007, at 4.30 p.m. Eastern, 3.30 p.m. Central, by dialing 1-866-825-3209 in the US or 617-213-8061 internationally. The pass code is 13738306. The call is also being web cast by CCBN and can be accessed at Carrington's website at http://www.carringtonlabs.com. A replay of the call will be available a few hours after the call concludes by dialing 1-888-286-8010 in the US and 617-801-6888 internationally. The pass code for the replay is 83847473.

The web cast is also being distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors may listen to the call at http://www.fulldisclosure.com, Thomson/CCBN's individual investor portal, powered by StreetEvents. Institutional investors may access the call via Thomson's password-protected event management site, StreetEvents (http://www.streetevents.com).

About Carrington

Carrington Laboratories, Inc. is an ISO 9001-certified, research-based, biopharmaceutical and consumer products company currently utilizing naturally-occurring complex carbohydrates to manufacture and market products for mucositis, radiation dermatitis, wound and oral care, as well as to manufacture and market the nutraceutical raw material Manapol(R) and cosmetic raw material Hydrapol(TM). Carrington also manufactures and markets consumer products and manufactures quality products for other companies. Manufacturing operations comply with cGMP standards. Carrington's DelSite Biotechnologies subsidiary is developing its proprietary GelSite(R) technology which is designed to provide controlled release of peptide and protein-based drugs. Carrington's technology is protected by more than 130 patents in 26 countries. Select products carry the CE mark, recognized by more than 20 countries around the world. For more information, visit http://www.carringtonlabs.com.

Non-GAAP Financial Information

This press release contains the non-generally accepted accounting principle financial measure of Pro forma loss, which is defined as net loss excluding net DelSite expenses. The amounts included in the calculation of this measure are computed in accordance with generally accepted accounting principles (GAAP). We believe this measure is useful to investors because it may provide users of this financial information with a meaningful measure of the Company's profitability before funding the research and development activities of its DelSite subsidiary. Pro forma loss is not a measure of financial performance under GAAP and thus should not be considered in isolation. Furthermore, it should not be seen as a substitute for metrics prepared in accordance with GAAP. Our reconciliation of this measure to net loss is included in the following tables.

Certain statements in this release concerning Carrington may be forward-looking. Actual events will be dependent upon a number of factors and risks including, but not limited to: subsequent changes in plans by the Company's management; delays or problems in formulation, manufacturing, distribution, production and/or launch of new finished products; changes in the regulatory process; changes in market trends; and, a number of other factors and risks described from time to time in the Company's filings with the Securities & Exchange Commission.

CONTACT: Carlton E. Turner, Chief Executive Officer of Carrington
Laboratories, Inc., +1-972-518-1300

Web site: http://www.carringtonlabs.com/