PRINCETON, N.J., Nov. 17 /PRNewswire-FirstCall/ -- Derma Sciences, Inc. , a provider of advanced wound care products, announced results today for the third quarter and first nine months ended September 30, 2008. Revenues for the quarter were $12,832,574, an increase of 59% over the $8,056,402 in revenues recorded during the same period last year. The results include nine months of sales from our First Aid Division (FAD) acquired in November 2007 and solid growth from our new MEDIHONEY(R) Wound and Burn Dressings. This result is a continuation of the strong increase in sales recorded by the Company during 2008; for the first nine months of 2008, revenues increased to $37,641,362, up by over 60% from the $23,483,457 for the like period of 2007.
Losses for the quarter totaled $701,619, or $0.02 loss per share compared to a slight profit of $9,854, or $0.00 per share during the same period last year. For the nine months ended 2008, losses totaled $3,381,895, or $0.09 loss per share, compared to $238,662, or $0.01 loss per share for the same period last year. Losses for the third quarter of 2008 resulted mainly from costs related to the Company’s active expansion of its sales and marketing efforts as well as ongoing expenses related to the FAD integration.
CEO Ed Quilty commented, “We are very pleased with the continued increase in sales, which have improved consistently each quarter. The increases have been driven by the addition of incremental FAD sales as well as advanced wound-care sales, particularly those of our recently released product, MEDIHONEY(R). MEDIHONEY is gaining solid recognition among the medical community for its effectiveness in battling a myriad of wound types, from minor burns and wounds to challenging chronic non-healing ulcers. As awareness of MEDIHONEY’s healing properties builds, it will become increasingly established as a product of choice.”
Quilty added, “Our goal at Derma Sciences is to become a leading provider of advanced wound-care products. We have continued to expand our product offering: last month we released the MedEfficiency TCC-EZ(TM) for diabetic foot ulcers, and this month we introduced our XTRASORB(TM) Super Absorbent Dressing -- the first of its kind in the US and Canada. Commercial sales of our newest product, MOBILITY1(TM) will begin in the coming weeks. Having an expanded line of novel products will help each sales representative cover their costs and more quickly achieve net positive contributions to the company. The speed with which we build these new brands and their revenues will be tied to the improvement in market conditions. We are closely managing cash flow and delaying initiatives with longer returns in favor of opportunities that provide cash flow in the near term. By doing this we feel we will be well positioned to accelerate growth when the markets start to turn positive.
“Thus far in 2008, we successfully created a strong brand in MEDIHONEY, and have several other new products that are just now hitting the market. We have established a professional sales force that is now equipped and ready to take our new and existing products to market. In addition, the first study patient has been entered into the company’s Phase II study of its topical drug candidate, DSC127, a wound-healing and scar-reduction agent that has shown very promising early results. Enrollment of the 75-patient study, looking into the drug’s ability to accelerate healing in diabetic foot ulcers, is expected to be completed within 12 months. 2009 will continue to see positive developments to our business, as we plan to launch new products and expand our business to new markets, including the UK and throughout Europe as well as the Middle East.
“We began 2008 by successfully launching MEDIHONEY and aggressively hiring a sales force to roll out the MEDIHONEY brand and our other new products. That investment, along with higher than expected integration costs for the FAD have driven our losses and negative cash flow. In the near term we continue to invest in sales and marketing initiatives, where we can support our operations with cash generated from those products. In addition, management believes that the contribution from FAD in 2009 will be much improved because of the positive results we have achieved this year in lowering the cost of goods and improved inventory management.”
Conference Call and Webcast
Derma’s management team will host a conference call to review the results and discuss other corporate news and its outlook this morning, November 17, 2008, at 11:00 AM ET.
Interested parties should call 800 299 0433 (domestic) or 617 801 9712 (international), with passcode 96313249 to access the call. You may also access this call via the Internet at:
http://phx.corporate-ir.net/playerlink.zhtml?c=107533&s=wm&e=1998826
For those who are unavailable to listen to the live broadcast, a replay will be available through December 17, 2008 and can be accessed by dialing 888 286 8010 (domestic) or 617 801 6888 (international) and using passcode 18191744.
About Derma Sciences
Derma Sciences is a global manufacturer and marketer of advanced wound- care products. Its key product, MEDIHONEY(R), is sold throughout the world by Derma Sciences and Comvita New Zealand -- the licensor of the patented honey- based technology -- and is the leading brand of honey-based dressings for the management of wounds and burns. The product has been shown to be effective in a variety of wounds and burns, and was recently the focus of a large-scale randomized controlled trial on leg ulcers. Derma has two products in development: the BIOGUARD(TM) line of barrier gauze dressings, and DSC127, the company’s novel angiotensin analog for accelerated wound healing and scar reduction. The barrier technology was licensed from Quick-Med in Q1 of 2007 and is pending its initial FDA marketing clearance. DSC127 was licensed from the University of Southern California in Q4 of 2007. For more information about Derma Sciences, Inc., visit its home page on the Internet at http://www.dermasciences.com.
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Forward-looking Statements
Statements contained in this release that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate” or “continue” are intended to identify forward-looking statements. Readers are cautioned that certain important factors may affect the Company’s actual results and could cause such results to differ materially from any forward-looking statements which may be made in this release or which are otherwise made by or on behalf of the Company. Factors which may affect the Company’s results include, but are not limited to, product demand, market acceptance, impact of competitive products and prices, product development, completion of an acquisition, commercialization or technological difficulties, the success or failure of negotiations and trade, legal, social and economic risks. Additional factors that could cause or contribute to differences between the Company’s actual results and forward-looking statements Include but are not limited to, those discussed in the Company’s filings with the Securities and Exchange Commission.
CONTACT: Edward J. Quilty, Chairman and CEO of Derma Sciences, Inc.,
+1-609-514-4744, equilty@dermasciences.com; or Rudy Barrio (US Investors),
r.barrio@allencaron.com, or Brian Kennedy (media), +1-212-691-8087,
brian@allencaron.com, both of Allen & Caron Inc, for Derma Sciences, Inc.
