TORONTO, Aug. 30 /PRNewswire-FirstCall/ -- Med-Emerg International Inc (OTC BB -MDER) today announced that for the six months ended June 30, 2004 its net loss for the period fell 82% from $1,676,737 (all amounts are U.S.dollars unless otherwise stated) in 2003 to $307,914 in 2004. For the three months ended June 30th, the net loss similarly decreased 79% from $753,635 in 2003 to $160,350 in 2004. At the same time, the Company increased its working capital position by $5,258,685 over the balance at December 31, 2003 as a result of its recently completed equity financing.
Revenues for the six months ended June 30, 2004 decreased 16% to $23,122,808 from $27,616,806. For the three months ended June 30, revenues decreased by 35% to $10,569,207 from $16,348,865. Closing costs associated with the above referenced equity financing caused EBITDA for the six months ended June 30, 2004 to fall to ($541,656) as compared to a positive EBITDA of $43,993 in 2003. Similarly, for the three months ended June 30, 2004 EBITDA declined to ($620,637) from ($32,359) in 2003. Reduced interest and financing costs associated with corporate borrowings as well as a reduction of stock compensation expenses and a one-time gain from the forgiveness of preferred share dividends of $563,477, resulted in the Company reporting a lower operating loss before income taxes of $271,242 for the six months ended June 30, 2004, as compared to $1,464,763 for the six months ended June 30, 2003.
The reduction in the Company’s loss reflects the significant reduction in stock compensation expenses and in general operating expenses, before considering the one-time impact of the closing costs associated with the equity financing. The decrease in revenue reflects the non-recurring nature of the revenue associated with the Company’s involvement with the SARS contract, which was awarded in March 2003, and to a lesser extent to the reduction in revenues associated with the Company’s on-going contract with the Canadian Department of National Defense. The gross margin for the six months ended June 30, 2004 diminished by 5% from $2,480,223 in 2003 to $ 2,353,629 in 2004. The operating expenses for the six months ended June 30, 2004, increased by about 19%, from $2,436,230 in 2003 to $2,895,285. After adjusting for the aforementioned impact of the closing costs associated with the equity financing, operating expenses were down about 5% for the six months ended June 30, 2004 and about 22% for the three months then ended.
Dr. Ramesh Zacharias said, “The second quarter was a busy time for Med-Emerg International Inc. (MDER). The Company successfully completed its equity financing, raising $4,500,000, eliminated its preferred share obligation, consolidated its equity structure and greatly enhanced its working capital position. At the same time we expanded our Board of Directors and appointed Michael Sinclair as our Chairman. We believe that all of these initiatives enhance MDERs positioning on a go-forward basis.”
MDER specializes in the coordination and delivery of emergency and primary health care related services in Canada. These services include physician and nurse staffing and recruitment, clinical management services, the development and management of urgent care centers, a national drug infusion service, and a comprehensive physician practice management program.
Certain oral and written statements of the management of the Company included in this press release may contain forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, and Section 21E of the U.S. Securities Exchange Act of 1934. The accuracy of such statements cannot be guaranteed as they are subject to a variety of risks.
Med-Emerg International Inc.
CONTACT: Ramesh Zacharias, Chief Executive Officer, Med-EmergInternational Inc., Tel: (905) 858-1368, Email: rzacharias@med-emerg.com