Exhibit 99.1



RMS Medical Products Announces Second Straight Record Quarterly Net Sales and Net Income


Net Sales for the quarter ended September 30, 2018 increased 18.1% over the same period last year

 

 

Gross Profit increased 21.6% over third quarter 2017 to $2.9 million, or 63.6% of Net Sales

 

 

Net Income increased 45% over third quarter 2017 to $386,553, or 8.5% of Net Sales

 

 

Conference call to discuss results October 24, 2018 at 9:00am EST


CHESTER, NY / October 23, 2018, Repro Med Systems, Inc. dba RMS Medical Products (OTCQX: REPR) today announced financial results for the third quarter ended September 30, 2018.


Net sales grew to $4.5 million, an 18.1% increase over the third quarter of 2017. The increase in net sales was driven by market expansion and gains in needle sets, tubing and pump sales.


Gross Profit grew to $2.9 million, or 63.6% of net sales, a 21.6% increase over third quarter 2017 Gross Profit of $2.4 million, or 61.8% of net sales. The increase in Gross Profit was mostly driven by the increase in net sales and operating efficiencies.


Selling, General and Administrative expenses and Research and Development costs for the third quarter of 2018 totaled $2.3 million, or 51.3% of net sales, compared to $1.9 million, or 49.6% of net sales during the third quarter of 2017. The increase was driven by higher legal fees related to the previously disclosed litigation with EMED and matters now under the purview of the Special Committee of the Board, and higher Research and Development and Regulatory expenditures as we invest in product development efforts. These increases were partially offset by lower salary and related benefit expenses, however, we are actively seeking to add talent to our Product Development and Commercial teams and these expenses may increase in the future.


Net income for the period increased to $386,553, or 8.5% of net sales, an increase of 45% compared with $265,754, or 6.9% of net sales, reported during the third quarter of 2017. Higher net sales, improved gross margin and the impact of the new lower income tax rate were contributors to the increase in net income.


“The third quarter saw continued momentum from the positive trends in home use of Subcutaneous Immunoglobulin Therapy driving the growth of RMS Medical Products,” stated Dan Goldberger, Chairman and interim CEO. “We are thrilled to have Don Pettigrew, an experienced infusion industry executive, as our new President and Chief Commercial Officer. Don is leading our strategic planning efforts as well as overseeing all sales and marketing activities at the company, and has hit the ground running. Our focus remains on our mission to improve the quality of life of patients around the world through the design, development and delivery of the highest quality innovative therapeutic solutions. Patient safety, product efficacy, customer service, and shareholder value continue to be our highest priorities.”


Mr. Goldberger continued, “The addition of Don Pettigrew and our increased investments to support R&D and clinical trial activity should lay the foundation for long term success. We are starting to see leverage in our income statement from expanding gross margins and control of operating expenses. Our balance sheet shows substantial cash resources and zero debt. All of this bodes well for future, profitable growth.”


- 1 -



Conference Call


An accompanying conference call will be led by Dan Goldberger, Chairman and interim Chief Executive Officer, Karen Fisher, Chief Financial Officer and Don Pettigrew, President and Chief Commercial Officer. The call will be held at 9:00AM ET, on Wednesday, October 24, 2018. Please refer to the information below for conference call dial-in information and webcast registration.


Conference date: October 24, 2018, 9:00 AM ET

Conference dial-in: 877-269-7756

International dial-in: 201-689-7817

Conference Call Name: RMS Medical Products (OTCQX: REPR) Third Quarter 2018 Results Call

Webcast Registration: Click Here


Following the live call, a replay will be available on the Company’s website, www.rmsmedicalproducts.com, under “Investor Relations” for six months.


About RMS Medical Products


The Company develops, manufactures and commercializes medical products used for home infusions and suctioning. The FREEDOM Syringe Infusion System currently includes the FREEDOM60® and FreedomEdge® Syringe Infusion Drivers, RMS Precision Flow Rate Tubing and RMS HIgH­Flo Subcutaneous Safety Needle Sets. These devices are used for infusions administered in professional healthcare settings as well as at home. The Companys RES­Q­VAC® line of medical suctioning products is used by emergency medical service providers in addition to a variety of other healthcare providers. For more information about RMS Medical Products, please visit www.rmsmedicalproducts.com.


Forward-Looking Statements


This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition to statements which explicitly describe such risks and uncertainties, readers are urged to consider statements labeled with the terms “believe”, “should,” “may” and “bodes well” to be uncertain and forward-looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in the Company’s reports and registration statements filed with the Securities and Exchange Commission.  The results of operations for the periods presented herein are not necessarily indicative of the results to be expected in the future.


Contact


Rich Cockrell

CG Capital

877.889.1972

investorrelations@cg.capital


- 2 -



REPRO MED SYSTEMS, INC.

BALANCE SHEETS


 

 

September 30,

 

December 31,

 

 

 

2018

 

2017

 

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

3,649,332

 

$

3,974,536

 

Certificates of deposit

 

 

1,671,004

 

 

263,269

 

Accounts receivable less allowance for doubtful accounts of $77,067 at September 30, 2018 and $77,067 at December 31, 2017

 

 

1,510,630

 

 

1,861,949

 

Inventory  

 

 

1,949,403

 

 

1,658,681

 

Prepaid expenses

 

 

348,085

 

 

170,739

 

TOTAL CURRENT ASSETS

 

 

9,128,454

 

 

7,929,174

 

Property and equipment, net

 

 

821,313

 

 

836,283

 

Patents, net of accumulated amortization of $229,693 and $203,768 at September 30, 2018 and December 31, 2017, respectively

 

 

595,754

 

 

483,821

 

Other assets

 

 

31,582

 

 

31,582

 

TOTAL ASSETS

 

$

10,577,103

 

$

9,280,860

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

Deferred capital gain - current

 

$

9,383

 

$

22,481

 

Accounts payable

 

 

591,919

 

 

454,398

 

Accrued expenses

 

 

627,237

 

 

658,060

 

Accrued payroll and related taxes

 

 

121,203

 

 

334,903

 

Accrued tax liability

 

 

55,002

 

 

115,854

 

TOTAL CURRENT LIABILITIES

 

 

1,404,744

 

 

1,585,696

 

Deferred capital gain – long term

 

 

 

 

3,762

 

Deferred tax liability

 

 

32,509

 

 

21,675

 

TOTAL LIABILITIES

 

 

1,437,253

 

 

1,611,133

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

Common stock, $0.01 par value; 75,000,000 shares authorized, 40,932,445 and 40,731,529 shares issued, 38,195,214 and 37,994,298 shares outstanding at September 30, 2018 and December 31, 2017, respectively

 

 

409,324

 

 

407,315

 

Additional paid-in capital

 

 

4,419,129

 

 

4,216,718

 

Retained earnings

 

 

4,655,601

 

 

3,389,898

 

 

 

 

9,484,054

 

 

8,013,931

 

Less: Treasury stock, 2,737,231 shares at September 30, 2018 and December 31, 2017

 

 

(344,204

)

 

(344,204

)

TOTAL STOCKHOLDERS’ EQUITY

 

 

9,139,850

 

 

7,669,727

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

10,577,103

 

$

9,280,860

 


- 3 -



REPRO MED SYSTEMS, INC.

STATEMENTS OF OPERATIONS (UNAUDITED)


 

 

For the

Three Months Ended

 

For the

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

 

 

2018

 

2017

 

2018

 

2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET SALES

 

$

4,547,187

 

$

3,849,338

 

$

13,082,737

 

$

11,317,231

 

Cost of goods sold

 

 

1,655,619

 

 

1,470,680

 

 

4,985,761

 

 

4,539,320

 

Gross Profit

 

 

2,891,568

 

 

2,378,658

 

 

8,096,976

 

 

6,777,911

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

2,203,614

 

 

1,893,911

 

 

6,106,514

 

 

5,674,357

 

Research and development

 

 

126,923

 

 

14,852

 

 

160,735

 

 

85,598

 

Depreciation and amortization

 

 

78,345

 

 

77,517

 

 

228,900

 

 

229,178

 

Total Operating Expenses

 

 

2,408,882

 

 

1,986,280

 

 

6,496,149

 

 

5,989,133

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Operating Profit

 

 

482,686

 

 

392,378

 

 

1,600,827

 

 

788,778

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-Operating (Expense)/Income

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss)/Gain on currency exchange

 

 

(5,842

)

 

10,419

 

 

(16,256

)

 

62,164

 

Gain on sale of fixed asset

 

 

6,000

 

 

 

 

6,000

 

 

 

Interest and other income

 

 

6,972

 

 

361

 

 

13,088

 

 

2,427

 

TOTAL OTHER (EXPENSE)/INCOME

 

 

7,130

 

 

10,780

 

 

2,832

 

 

64,591

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PROFIT BEFORE TAXES

 

 

489,816

 

 

403,158

 

 

1,603,659

 

 

853,369

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax Expense

 

 

(103,263

)

 

(137,404

)

 

(337,956

)

 

(312,192

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME

 

$

386,553

 

$

265,754

 

$

1,265,703

 

$

541,177

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME PER SHARE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.01

 

$

0.01

 

$

0.03

 

$

0.01

 

Diluted

 

$

0.01

 

$

0.01

 

$

0.03

 

$

0.01

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

38,194,682

 

 

37,898,357

 

 

38,104,393

 

 

37,833,133

 

Diluted

 

 

38,985,684

 

 

38,072,425

 

 

38,875,737

 

 

37,934,851

 


- 4 -



REPRO MED SYSTEMS, INC.

STATEMENTS OF CASH FLOWS

(UNAUDITED)


 

 

For the Nine Months Ended

 

 

 

September 30,

 

 

 

2018

 

2017

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

 

Net Income

 

$

1,265,703

 

$

541,177

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

Amortization of deferred compensation cost

 

 

 

 

7,000

 

Stock based compensation expense

 

 

154,925

 

 

87,271

 

Depreciation and amortization

 

 

228,900

 

 

229,178

 

Gain on sale of fixed asset

 

 

(6,000

)

 

 

Deferred capital gain - building lease

 

 

(16,860

)

 

(16,860

)

Deferred taxes

 

 

10,834

 

 

8,843

 

Provision for returns and doubtful accounts

 

 

 

 

58,339

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Decrease/(Increase) in accounts receivable

 

 

351,319

 

 

(243,428

)

Increase in inventory

 

 

(290,722

)

 

(225,177

)

(Increase)/Decrease in prepaid expense and other assets

 

 

(177,346

)

 

37,753

 

Increase/(Decrease) in accounts payable

 

 

137,521

 

 

(409,171

)

Decrease in accrued payroll and related taxes

 

 

(213,700

)

 

(17,253

)

(Decrease)/Increase in accrued expense

 

 

(30,823

)

 

136,045

 

(Decrease)/Increase in accrued tax liability

 

 

(60,852

)

 

303,349

 

NET CASH PROVIDED BY OPERATING ACTIVITIES

 

 

1,352,899

 

 

497,066

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

 

Payments for capital expenditures

 

 

(188,006

)

 

(160,946

)

Purchase of certificate of deposit

 

 

(1,500,000

)

 

 

Proceeds on sale of fixed assets

 

 

6,000

 

 

 

Payments for patents

 

 

(137,858

)

 

(70,556

)

Proceeds/(reinvested earnings) from certificates of deposit

 

 

92,266

 

 

(1,196

)

NET CASH USED IN INVESTING ACTIVITIES

 

 

(1,727,598

)

 

(232,698

)

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

Stock issuances

 

 

51,250

 

 

 

Payment for cancelled shares

 

 

(1,755

)

 

(19,360

)

Purchase of treasury stock

 

 

 

 

(484

)

NET CASH PROVIDED BY/(USED IN) FINANCING ACTIVITIES

 

 

49,495

 

 

(19,844

)

 

 

 

 

 

 

 

 

NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS

 

 

(325,204

)

 

244,524

 

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

 

 

3,974,536

 

 

3,417,183

 

CASH AND CASH EQUIVALENTS, END OF PERIOD

 

$

3,649,332

 

$

3,661,707

 

 

 

 

 

 

 

 

 

Supplemental Information

 

 

 

 

 

 

 

Cash paid during the periods for:

 

 

 

 

 

 

 

Interest

 

$

 

$

 

Taxes

 

$

378,000

 

$

 

 

 

 

 

 

 

 

 

NON-CASH FINANCING AND INVESTING ACTIVITIES

 

 

 

 

 

 

 

Issuance of common stock as compensation

 

$

103,333

 

$

101,250

 


- 5 -


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