BANGOR, Maine, Sept. 28 /PRNewswire-FirstCall/ -- Nyer Medical Group, Inc. today reported the audited results for its fiscal year ended June 30, 2005. Revenues were $61,184,025 for fiscal year ended June 30, 2005 as compared to $61,687,258 as reported for the same period ended June 30, 2004. The Company reported a net income of $223,639 or $.06 per diluted common share for the year ended June 30, 2005 as compared to a net loss of $425,220 or $.11 per diluted common share for the same period ended June 30, 2004.
The pharmacies segment’s sales decreased $327,354 to $52,893,153 or .6% for the year ended June 30, 2005 as compared to $53,220,507 for the year ended June 30, 2004. The main reason for the decrease was the impact of the renegotiation of an expired contract with one federally qualified health center (FQHC), with different terms and conditions, from a replenishment model to a segregated inventory model. The remaining contracts for the FQHCs are still under the replenishment model. Had the previous replenishment model and corresponding revenue recognition been employed, additional sales of approximately $3,101,600 would have been recognized for the year ended June 30, 2005. As such, pharmacies sales would have been approximately $56,000,000, or an increase of approximately 3.7% for the year ended June 30, 2005.
The pharmacies segment’s selling, general & administration expenses increased $528,591 or 5.5% for the year ended June 30, 2005. The increase was due to the increased labor costs (including benefits), shortage of available pharmacists, and an increase in depreciation expense. There were additional costs associated with the opening of a new location within a medical center in Waltham, MA, in late November 2004, with the center being recently acquired by Boston Children’s Hospital. These increases were partially offset by: decreased legal fees, decreased advertising cost and decreased amortization totaling $281,000. Management expects that its presence within this unique medical community in Waltham, MA, will result in added sales volume and incremental profits. Management expects prescriptions to increase overall due to an aging population, increased Medicare prescription benefits and additional prescription drugs coming to market.
The medical segment’s sales decreased $175,879 in 2005 to $8,290,872 or 2.1% for the year ended June 30, 2005 as compared to $8,466,751 for the year June 30, 2004. Over $400,000 was due to increased pressure from regional and national buying groups that are able to command larger discounts from manufacturers and able to offer on-line purchasing and inventory controls. Also, increased pressure continues from larger competitors who offer lower prices. In addition, physicians and physician groups are being purchased by hospitals which require they purchase from their sources resulting in a decrease of $80,000. The balance is due to new buying groups offering lower prices to induce customers to purchase their products and not selling products with very low gross profit margins. Internet sales increased approximately $330,000 which helped offset the decline.
The medical segment’s selling, general & administration expenses decreased $364,481 or 12.7% to $2,512,275 for the year June 30, 2005 as compared to $2,876,756 for the year June 30, 2004. The decrease was due to a combination of the following: a reduction in sales related expenses of $160,000, a reduction in bad debt expense of $63,000, personnel costs of $48,900, Nevada overhead costs of $37,000, advertising costs of $33,000, reduced bulk inventory storage costs of $8,000, mortgage interest of $6,000 and building maintenance and repair costs of $5,100.
The corporate segment’s overhead decreased by $137,269 or 21.2% to $511,510 for the year June 30, 2005 as compared to $648,779 for the year June 30, 2004. The decrease was due to a combination of the following reductions: personnel costs of approximately $91,200, public relation fees and stock related expenses of approximately $74,000, and insurance of $14,700. Legal and audit fees increased approximately $56,000.
Karen Wright, President and Chief Executive Officer of Nyer Medical Group, Inc., stated, “The Company has come from a deficit of $.11 per share for the year ended June 30, 2004 to a $.06 per share profit for year ended June 30, 2005, a turn around over the past 12 months of $.17 per share. Even though we are very pleased with these results and the overall financial improvement in the Company, which is demonstrated by the unqualified opinion from our independent accounting firm with respect to the Company’s financial stability, we will continue to work hard to improve the Company’s financial condition.”
Nyer Medical Group, Inc., is a holding company that operates pharmacies in the greater Boston area and a medical products distribution business that distributes and markets medical equipment and supply products to hospitals, physicians and nursing homes using relationship-based telemarketing, direct sales personnel, catalogs and the Internet. These orders are filled by the Company’s distribution centers located in New England and South Florida.
For further information contact Alliance Capital Resources, Inc., Jack Sutton (909) 597-2476.
Safe Harbor under the Private Securities Litigation Reform Act of 1995
This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. All statements in this release that are not historical facts, including, but not limited to management expecting (a) that the pharmacy presence in Waltham, MA will result in added sales volume and incremental profits and (b) an overall increase in prescriptions are forward-looking statements and are subject to risk and uncertainties. Such risk and uncertainties include, but are not limited to, sustained profitability and any possible change in our core business. Among the factors that change the anticipated results are changes in the capital equity markets. Nyer does not undertake any obligation to update these forward-looking statements.
Nyer Medical Group, Inc.
CONTACT: Jack Sutton of Alliance Capital Resources, Inc., +1-909-597-2476
Web site: http://nyermedicalgroup.com//
