The Female Health Company - Press Releases May 1999

CHICAGO, May 14 -- The Female Health Company (OTC Bulletin Board: FHCO) today reported a net loss for its fiscal second quarter ending March 31, 1999. The net loss was reduced 28 percent to $1,132,916, or $0.11 per diluted share, compared to a net loss of $1,578,918, or $0.17 per diluted share for the same period in 1998. Despite lower unit sales volume during the current period, the Company narrowed the quarterly net loss due to a one time, non-recurring $817,000 charge taken during the six months ended March 31, 1998 to record a fully amortized discount reflected as preferred dividends accreted.

Second quarter net revenues decreased 32 percent to $1,093,722 from the $1,619,949 reported in the same period in 1998. Unit sales and orders in house totaled 3.2 million units compared to 2.6 million in the same prior year quarter. The results were consistent with the expectations for the quarter, in terms of shipments and orders. Net sales for the prior year were significantly higher as a result of first phase country launches associated with the United Nations Joint Programme on HIV/AIDS (UNAIDS). The Company expects significant quarter to quarter variation due to the timing of receipt of large orders, subsequent production scheduling, and shipping of products as various countries launch the product.

UNAIDS recently announced that the second phase of its partnership with the Female Health Company will start this year. A spokesman for UNAIDS stated, ``We plan to dramatically increase the number of women who have access to the product.'' The second phase of this program is now underway. Launches are being planned in five countries and program development in twelve others. The Female Condom's importance in the fight against the spread of HIV/AIDS is highlighted in a May 11, 1999 UNAIDS press release stating that AIDS is now the leading cause of death in Africa and fourth leading cause worldwide.

On May 13, 1999, the Center for Disease Control HIV/STD/TB Prevention News Update reported, ``Female condoms gain ground in Francophone Africa.'' The article noted, ``The Female Condom appears to be growing in popularity in such places as Togo, Burkina Faso and Cameroon.'' One doctor who specializes in reproductive health stated, ``Our objective is to protect the woman. So if they like (the female condom) because it does not crack like the male condom, this is very encouraging. If used properly, the protection offered by a female condom is between 94 and 97 percent, and some experts estimate that the female condom could reduce HIV transmission between men and women by 46 percent.''

Mary Ann Leeper, Ph.D., President of The Female Health Company, commented, ``While there will be variations quarter to quarter as the program develops, the Company believes substantial volume will develop based on recent studies indicating that when available, female condom usage could account for 24-35 percent of total condom usage.''

For the six months ended March 31, 1999, net revenues totaled $1,797,720 with a net loss of $2,094,956, compared to net revenues of $2,925,753 and a net loss of $2,672,354 for the same 1998 period. Excluding the prior year charge of $817,000, the Company would have experienced an increase in net loss principally related to decreased sales volume offset in part by a decline in cost of goods sold and a reduction in advertising and promotion expenses.

The decrease in cost of goods sold resulting from the decline in sales was offset, in part, by a change between years in the Company's reserve for inventory obsolescence. During the six months ended March 31, 1998 a $589,388 reduction in the Company's reserve for obsolescence occurred. The Company did not materially adjust inventory reserves during the same
period this year.

Leeper stressed, ``Reduced operating expenses are a continued reflection of the Company's strategy to act as a manufacturer. Virtually all marketing and shipping costs are picked up by the customer. Therefore, the Company's expenses are not expected to increase materially as unit volume increases.''

Net revenues	$1,094	$1,620	(32%)	$1,798	$2,925	(38%)
Gross Profit (loss)	$(247)	$(109)		$(405)	($166)
Net Income (loss)	($1,133)	($1,579)	NM	($2,095)	($2,672)	NM
EPS, basic and diluted	($0.11)	($3.17	NM	($0.20)	($0.28)	NM
Average Shares outstanding	10,624,937	9,549,419	+11	10,532,073	9,546,883	+10

ABOUT THE COMPANY
The Female Health Company, based in Chicago, owns certain worldwide rights to The Female Condom(TM) including
patents which have been issued in the United States, United Kingdom, Japan, France, Italy, Germany, Spain, The People's
Republic of China, Canada, New Zealand, South Korea and Australia. The Female Condom(TM) is the only available
product controlled by a woman that protects against sexually transmitted diseases including HIV/AIDS, and unintended
pregnancy.

``Safe Harbor'' Statement under the Private Securities Litigation Reform Act of 1995: The statements in this release which are
not historical fact are forward-looking statements based upon the Company's current plans and strategies, and reflect the
Company's current assessment of the risks and uncertainties related to its business, including such things as product demand
and market acceptance; the economic and business environment and the impact of governmental regulations, both in the
United States and abroad; the effects of competitive products and pricing pressures; currency risks; capacity; efficiency and
supply constraints; and other risks detailed in the Company's press releases, shareholder communications and Securities and
Exchange Commission filings. Actual events affecting the Company and the impact of such events on the Company's
operations may vary from those currently anticipated.

	March 31,1999	September 30,1998
Cash and equivalents	$ 432,912	$1,480,287
Accounts receivable, net	832,649	1,138,274
Inventories, net	1,235,238	925,425
Prepaid and other current assets	242,254	395,293
Total Current Assets	2,743,054	3,939,279

Note receivable	------------	------------
Other non-current assets	983,795	1,090,020
Net property, plant & equipment	2,174,449	2,529,595
TOTAL ASSETS	$5,901,298	$7,558,894

Notes payable, net of unamortized discount	$1,049,740	$837,139
Accounts payable	522,530	473,979
Accrued expenses	359,691	614,819
Debt due within one year	675,086	626,066
Preferred diviidends payable	68,377	147,635
Total current liabilities	2,675,424	2,699,638

Long-term debt and capital leases	---------	4,882
Other long-term liabilities	1,763,320	1,919,797
Total liabilities	4,438,744	4,624,317

Total Stockholders' equity	1,462,554	2,934,577
TOTAL LIABILITIES AND EQUITY	$5,901,298	$7,558,894

	1999	1998	1999	1998
NET REVENUES	$1,093,722	$1,619,949	$1,797,720	$2,925,753

GROSS PROFIT (LOSS)	(247,059)	108,811	(404,512)	(166,039)

Advertising and promotion	82,380	110,307	174,843	279,228
SG&A	710,401	686,914	1,316,034	1,256,668
Total Operating Expenses	792,781	797,221	1,490,877	1,535,896
OPERATING LOSS	(1,039,840)	(688,410)	(1,895,389)	(1,701,935)

Interest, net and other expense	59,881	39,974	130,817	85,606
Pretax loss	(1,099,721)	(728,384)	(2,026,206)	(1,787,541)

Income taxes	--	--	--	--
NET LOSS	(1,099,721)	(728,384)	(2,026,206)	(1,787,541)

Preferred dividends, accreted, Series 2	--	817,000	--	817,000
Preferred dividends, Series 1	33,195	33,534	68,750	67,813

NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS	(1,132,916)	(1,578,918)	(2,094,956)	(2,672,354)

NET LOSS PER COMMON SHARE	$(0.11)	$(0.17)	$(020)	$(0.28)

Weighted average common shares	10,624,937	9,549,419	10,532,073	9,546,883

May 1999 Press Releases