THE FEMALE HEALTH 

    COMPANY REPORTS:

 

 

FEMALE HEALTH COMPANY REPORTS

SECOND QUARTER RESULTS

REVENUES UP 56%

GROSS PROFIT UP 231%

OPERATING INCOME $.2 MILLION vs. $.3 MILLION LOSS

NET LOSS DOWN 97%

 

CHICAGO, May 8, 2002-- The Female Health Company (OTC BB FHCO) today reported net revenues of $2,260,298 and net loss attributable to common stockholders of $14,471 ($0.00 per diluted share) for the three months ended March 31, 2002 compared to revenues of $1,449,297 and a net loss attributable to common stockholders of $435,269 ($0.03 per diluted share) for three months ended March 31, 2001. 

The Company posted operating income for the three-month period ended March 31, 2002 of $240,462 compared to a $250,256 operating loss for the same period last year as a result of improved gross profit. 

Net revenues increased $811,001 for the current quarter or 56 percent, compared with the same period last fiscal year. The higher sales volume for the second quarter was attributable to a substantial increase in shipments to domestic and global public sector customers. The results were consistent with the expectations for the quarter and demonstrate the Female Health Company’s continued progress in executing its long-term strategies for growth. The Company expects significant quarter-to-quarter variation due to the timing of receipt of large orders, subsequent production scheduling, and shipping of products.  

Gross profit increased $504,858 or 231 percent to $723,096 from $218,238 for the same period last year. The improvement in gross profit resulted from the increase in net revenues coupled with a less than proportionate increase in cost of goods sold. As unit sales increase, fixed manufacturing costs do not increase, enabling the Company to produce at a lower cost of goods sold per unit.  

Total operating expenses for the three-month ended March 31, 2002 increased three percent to $482,634 from $468,494 for the same period last year. Total operating expenses as a percent of sales were 21% in the second quarter compared to 32% in the same prior year quarter.  

The Company experienced a $70,915 increase in non-operating expenses to $222,380 for the current quarter compared to $151,465 for the same period during the prior fiscal year. The increase during the current period is principally due to a higher level of debt outstanding than the same period last year which resulted in a larger amount of non-cash expenses incurred from the amortization of discounts on the credit facility and notes payable than the second quarter of the prior year. 

The Company posted operating income for the six-month period ended March 31, 2002 of $73,685 compared to a $718,913 operating loss for the same period last year as a result of improved gross profit and a reduction of operating expenses. 

Net revenues increased $1,267,547 or 48 percent, to $3,930,469 for the six months period ended March 31, 2002 from $2,662,922 for the same period last fiscal year. The higher sales volume for the second quarter was attributable to a substantial increase in shipments to domestic and global public sector customers.  

Gross profit increased $719,872 or 238%, to $1,021,861 from $301,989 for the same period last year. The improvement in gross profit resulted from the increase in net revenues coupled with a less than proportionate increase in cost of goods sold.  

Total operating expenses for the six-month period ended March 31, 2002 decreased 7 percent to $948,176 from 1,020,902 for the same period last year. Total operating expenses as a percent of sales were 24% for the current period compared to 38% in the same period during the prior year.  

The Company experienced a $109,736 increase in non-operating expenses to $411,893 for the current six months compared to $302,157 for the same period during the prior fiscal year. The increase during the current period is principally due to a higher level of debt outstanding than the same period last year which resulted in a larger amount of non-cash expenses incurred from the amortization of discounts on the credit facility and notes payable. 

The Female Health Company, based in Chicago, owns certain worldwide rights to The Female Condomä 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 Condomä 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 Action of 1995: The statements in this release which are not historical fact are forward-looking statements based upon the Company’s current plan 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 government pressures; currency risks; capacity; efficiency and supply constraints; and other risks detailed in the Company’s press releases, shareholder communication 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.

For more information about the Female Health Company, dial toll-free via fax, 1-800-PRO-INFO and enter company code “FHCO”. Also, visit the Company’s web site at www.femalehealth.com and www.femalecondom.org. If you would like to be added to an e-mail alert list, please send an e-mail to FHCInvestor@aol.com .

Contacts:        Investors                        Business / Product               Global Program         

                        William R. Gargiulo, Jr.     Mary Ann Leeper, Ph.D.           Mitchell Warren

                        231.526.1244                      312.595.9123                           845.353.8298

 

 

Unaudited Condensed Consolidated Balance Sheet

March 31,

March 31,

 

2002

2001

Cash and equivalents

 $    612,162

 $ 693,378

Accounts receivable, net

    1,768,872

          788,959

Inventories, net

       726,861

          537,800

Prepaid and other current assets

       228,643

          157,052

Total Current Assets

    3,336,538

       2,177,190

 

 

 

Other non-current assets

       664,511

          689,653

Net property, plant & equipment

       807,152

       1,162,754

TOTAL ASSETS

 $ 4,808,201

 $   4,029,597

 

 

 

Notes payable, net of unamortized discount

 $    738,658

 $   1,160,948

Convertible debentures, net of unamortized discount

----

       1,727,186

Accounts payable

       706,526

          515,311

Accrued expenses

       261,074

          558,014

Preferred dividends payable

         67,823

             67,633

Total current liabilities

    1,774,081

       4,029,092

 

 

 

Notes payable, net of unamortized discount

       939,748

----

Convertible debentures, net of unamortized discount

       450,000

----

Deferred gain on the lease of facility

    1,193,836

       1,308,898

Total liabilities

    4,357,665

       5,337,990

 

 

 

Total Stockholders' equity(deficit)

       450,536

      (1,308,393)

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 $ 4,808,201

 $    4,029,597

 

Unaudited Condensed Consolidated Income Statement 

For the

 Quarter Ended

 

For the

Six Months Ended

 

March 31,

 

March 31,

 

2002

2001

 

2002

2001

NET REVENUES

 $  2,260,298

 $ 1,449,297

 

 $ 3,930,469

 $2,662,922

 

 

 

 

 

 

GROSS PROFIT

         723,096

        218,238

 

    1,021,861

       301,989

 

 

 

 

 

 

Advertising and promotion

           10,134

          21,085

 

          21,075

       107,166

SG&A excluding Stock Comp.

         407,954

        425,535

 

        842,947

       871,942

Stock Compensation

           64,546

          21,874

 

          84,154

         41,794

Total Operating Expenses

         482,634

        468,494

 

        948,176

   1,020,902

OPERATING INCOME(LOSS)

         240,462

      (250,256)

 

          73,685

     (718,913)

 

 

 

 

 

 

Interest, net and other expense

         222,380

        151,465

 

        411,893

       302,157

Income(Loss) before income taxes

           18,082

      (401,721)

 

      (338,208)

  (1,021,070)

 

 

 

 

 

 

Income taxes

                    -  

                   -  

 

                   -  

                  -  

NET INCOME(LOSS)

           18,082

      (401,721)

 

      (338,208)

  (1,021,070)

 

 

 

 

 

 

Preferred dividends, Series 1

           32,553

          33,548

 

          65,824

         66,819

 

 

 

 

 

 

NET LOSS ATTRIBUTABLE TO

 

 

 

 

 

COMMON STOCKHOLDERS

         (14,471)

      (435,269)

 

      (404,032)

  (1,087,889)

 

 

 

 

 

 

 

 

 

 

 

 

NET LOSS PER COMMON SHARE

 $           (0.00)

 $         (0.03)

 

 $         (0.03)

 $         (0.08)

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares

   16,003,165

  14,449,174

 

  15,934,252

 14,260,150