EX-99.1 3 dex991.htm PRESS RELEASE OF MOORE MEDICAL CORP. DATED AUGUST 6, 2003 PRESS RELEASE OF MOORE MEDICAL CORP. DATED AUGUST 6, 2003

[Moore medical logo]

Exhibit 99.1

 

Contacts:

              
    

John M. Zinzarella, CPA

Moore Medical Corp.

Vice President of Finance, Treasurer and

Chief Financial Officer

860-826-3655

jzinzarella@mooremedical.com

  

Allyne Mills

Rosica Mulhern Strategic Public Relations

201-843-5600

allyne@rosica.com

    

 

Moore Medical Announces Second Quarter 2003 Operating Results

 

NEW BRITAIN, CT – August 6, 2003 – Moore Medical Corp. (AMEX:MMD), a leading multi-channel specialty marketer and distributor of medical, surgical and pharmaceutical products to health care professionals in non-hospital settings, today announced a second quarter 2003 net loss of ($0.18) per diluted share, versus income of $0.09 per diluted share in the second quarter of 2002.

 

The Company’s second quarter 2003 loss of ($0.18) per diluted share on a net loss of ($0.6) million compared to income of $0.09 per diluted share on net income of $0.3 million in the comparable period one year ago. Second quarter 2003 net sales increased 7.5% to $35.9 million from $33.4 million in the previous year’s second quarter. Sales growth fell short of the Company’s original expectations, although growth achieved late in the second quarter did begin to show the benefits from investments in the prior two quarters in the Company’s primary care sales force and strategic product portfolio expansion.

 

Second quarter gross profit as a percentage of net sales was 27.5% compared to 27.4% in the same quarter last year, despite continuing external price pressures in certain markets and aggressive pricing required to gain entry into competitively held new accounts. Sales and marketing expenses increased $0.9 million, or 33.3% over last year’s second quarter, reflecting increased expenses related to the Company’s expansion of the field sales staff, as well as increased direct marketing initiatives. General and administrative expenses increased $1.1 million, or 18.3%, to $7.1 million in the second quarter of 2003 from $6.0 million in last year’s second quarter, due to higher costs related to net periodic pension expense, professional service fees, property and casualty insurance expense and bad debt expense. During the first two quarters of 2003, the Company experienced difficulties in its accounts receivable collection efforts, particularly in smaller dollar volume accounts, which contributed to an increase in bad debt expense. Also contributing to the increase in general and administrative expenses was the recognition of $0.2 million of


expense arising from an unfavorable court judgment (7/31/03) with regard to a plaintiff’s attorney’s fees from a lawsuit filed in 1994 by the estate of a former employee, related to employee benefits administration.

 

For the six months ended June 28, 2003, the Company’s net sales increased 5.5% to $69.5 million compared with $65.9 million in last year’s comparable period. Net loss for the six months was ($0.7) million, or ($0.23) per diluted share, compared with net income of $0.5 million or $0.15 per diluted share during last year’s six-month period.

 

“The sales levels achieved for the first six months fell short of our original expectations and did not generate sufficient income to offset the increased costs of doing business,” said Linda M. Autore, president and chief executive officer of Moore Medical Corp. “However, we began to see promising growth in several markets, toward the end of the second quarter. We continue to be committed to our growth strategy and believe that our investments will result in improved revenue growth and profitability during the remainder of fiscal 2003.”

 

About Moore Medical

 

Moore Medical is an Internet-enabled multi-channel marketer and distributor of medical, surgical and pharmaceutical products to approximately 100,000 health care practices and facilities in non-hospital settings nationwide, including: physicians; emergency medical technicians; schools; correctional institutions; municipalities; occupational/industrial health doctors and nurses; and other specialty practice communities. Moore Medical also serves the medical/surgical supply needs of 29 customer community affiliates. The Company markets and serves its customers through direct mail, industry-specialized telephone support staff, field sales representatives, and the Internet. Its direct marketing and distribution business has been in operation for 55 years. More information about the Company can be found at www.mooremedical.com.

 

“SAFE HARBOR” STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. This press release contains statements about future events and expectations that constitute forward-looking statements under the federal securities laws. These statements are characterized by words such as “believe,” “may,” “will,” “could,” “should,” “would,” “anticipate,” “estimate,” “expect,” “intent,” “project,” “objective,” “seek,” “strive,” “might,” “likely result,” “build,” “grow,” “plan,” “goal,” “expand,” “position,” or similar words. Forward-looking statements involve risks and uncertainties (including factors outside our control) that may cause our actual results, performance or financial condition to differ materially from any future results implied by such forward-looking statements. Factors that could

 

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contribute to these differences include, but are not limited to: the inability to generate adequate revenues and income from our strategy to transform the Company to a multi-channel e-commerce enabled business; changes in demand for or supply of our products; online security breaches; disruptions in or cost increases for third-party services or systems; intense competition in health care product distribution; government regulation of drug and medical device distribution, the Internet and health care products and services; and changes in insurance coverage of health care products and services. Further information regarding factors that could affect our results and the statements made herein are included in our filings with the Securities and Exchange Commission.

 

Financial Statements to Follow

 

 

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MOORE MEDICAL CORP. & SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

 

Unaudited    Second Quarter

   First Two Quarters

(Amounts in thousands, except per share data)


   June 28, 2003

    June 29, 2002

   June 28, 2003

    June 29, 2002

Net sales

   $ 35,911     $ 33,441    $ 69,524     $ 65,878

Cost of products sold

     26,026       24,267      50,545       47,708
    


 

  


 

Gross profit

     9,885       9,174      18,979       18,170

Sales and marketing expenses

     3,608       2,703      6,478       5,269

General and administrative expenses

     7,136       5,991      13,573       12,071
    


 

  


 

Operating (loss) income

     (859 )     480      (1,072 )     830

Interest expense, net

     43       40      86       87
    


 

  


 

(Loss) Income before income taxes

     (902 )     440      (1,158 )     743

Income tax (benefit) provision

     (325 )     159      (417 )     267
    


 

  


 

Net (loss) income

   $ (577 )   $ 281    $ (741 )   $ 476
    


 

  


 

Basic net (loss) income per share

   $ (0.18 )   $ 0.09    $ (0.23 )   $ 0.15

Diluted net (loss) income per share

   $ (0.18 )   $ 0.09    $ (0.23 )   $ 0.15

Basic common shares outstanding*

     3,190       3,156      3,190       3,155

Diluted common shares outstanding*

     3,190       3,181      3,190       3,179

 

*weighted average

 

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MOORE MEDICAL CORP. & SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

 

(Amounts in thousands, except par value)


   June 28,
2003


    December 28,
2002


ASSETS

     (Unaudited )      

Current Assets

              

Cash and cash equivalents

   $ 100     $ 100

Accounts receivable, less allowances of $1,743 and $1,249, respectively

     19,680       17,187

Inventories

     11,344       11,230

Prepaid expenses and other current assets

     1,027       1,216

Deferred income taxes

     1,871       1,871
    


 

Total Current Assets

     34,022       31,604
    


 

Noncurrent Assets

              

Property, plant and equipment, net

     6,155       6,254

Other assets

     1,936       2,137
    


 

Total Noncurrent Assets

     8,091       8,391
    


 

     $ 42,113     $ 39,995
    


 

LIABILITIES AND SHAREHOLDERS’ EQUITY

              

Current Liabilities

              

Accounts payable

   $ 10,078     $ 5,794

Amounts due to customers

     1,905       2,342

Accrued expenses

     1,590       1,723

Cash overdraft

     1,267       1,632

Current portion long-term debt

     3,560       —  
    


 

Total Current Liabilities

     18,400       11,491
    


 

Deferred Income Taxes

     855       855

Accrued Pension

     465       233

Long-Term Debt

     —         4,281

Total Shareholders’ Equity

     22,393       23,135
    


 

     $ 42,113     $ 39,995
    


 

 

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