HemaCare Reports Record 4th Quarter and 2008 Revenues
LOS ANGELES, CA -- (Marketwire - February 24, 2009) - HemaCare Corporation (OTCBB: HEMA)
announced today fourth quarter and year ended 2008 results, with the
highest levels of quarterly and annual revenue in the Company's history.
Sales for the quarter were $10.0 million, 11% greater than the prior year,
while sales for the year were $37.6 million, 10% greater than in 2007.
The Company generated fourth quarter income of $179,000, or $0.02 per
share, and yearly income of $979,000, or $0.10 per share. In 2007, the
Company generated a loss of $1.4 million in the fourth quarter and a loss
of $7.8 million for the year.
Discussion of 2008 Continuing Operations
Blood Products revenue from continuing operations in the quarter was $8.0
million, compared to $7.1 million in the same quarter of 2007, representing
an increase of 12%. For the year, Blood Products revenue was $29.6
million, compared to $26.8 million for 2007, representing an increase of
11%.
Blood Services revenue in the quarter was $2.0 million, compared to $1.8
million in the same quarter of 2007, representing an increase of 11%.
Blood Services revenue for the year was $8.0 million, compared to $7.4
million in 2007, representing an increase of 8%.
Gross profit margin from continuing operations in the quarter was 17%,
compared to 19% in the fourth quarter of 2007. For the year, gross profit
margin was 17%, compared to 15% in 2007. The improvement in gross profit
margin in 2008, along with sales growth, resulted in a year over year
increase in gross profit of $1.3 million.
For all of 2008, general and administrative expenses decreased $447,000, or
7%, compared to 2007, which included $326,000 in non-recurring severance
expense for the Company's former Chief Executive Officer. For all of 2008,
general and administrative expenses represented 16% of revenue, a decrease
from 19% reported in 2007.
During 2008 the Company recognized $331,000 of non-operating income,
primarily related to a gain from the settlement of litigation with the
former owners of HemaCare BioScience, Inc.
"We are very pleased to report record revenue for 2008, which enabled the
Company to make a dramatic swing from a $1.2 million pretax operating loss
in 2007 to over $900,000 in pretax operating profit in 2008," commented
John Doumitt, the Company's Chief Executive Officer. "As sales grow in the
future, we expect to leverage fixed costs and improve profitability." Mr.
Doumitt added, "In 2009, we will seek to further develop our community
whole blood program, which we market in conjunction with local hospitals,
and aggressively build our platelet collection and therapeutic blood
services businesses. 2008 has given HemaCare a new start, and we intend to
build momentum in 2009 by continuing to deliver exceptional value to our
customers."
Discussion of Discontinued Operations
The Company's Florida-based research blood products subsidiary was closed
on November 5, 2007. This subsidiary generated a fourth quarter 2008 loss
of $13,000 compared to a $1.6 million loss in the same quarter of 2007.
For all of 2008, closure activities resulted in an $80,000 gain compared to
a $6.0 million loss for 2007. Closure activities for this subsidiary are
still underway, although it is not expected that they will have a
significant negative impact on future results.
About HemaCare Corporation
Founded in 1978, HemaCare is a provider of blood products and services to
the healthcare industry. HemaCare is licensed by the FDA and accredited by
the AABB. The Company focuses on the customized delivery of human
blood-related products and services.
This press release contains "forward-looking statements" under the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995
(Section 27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended). Statements herein that
are not historical facts are forward-looking statements pursuant to the
safe harbor provisions referenced above. You may also identify
forward-looking statements by use of the words "anticipates," "expects,"
"intends," "plans" and similar expressions. These forward-looking
statements include, but are not limited to, statements regarding the
Company's expectation to leverage fixed costs, improve profitability,
further develop its whole blood program in conjunction with local hospitals
and aggressively build momentum in 2009. Forward-looking statements are
inherently subject to risks and uncertainties some of which cannot be
predicted or quantified. Such risks and uncertainties include, without
limitation, the following: the Company reported losses for all of 2007
and may not return to profitability; costs increasing more rapidly than
market prices could reduce profitability, changes in demand for blood
products could affect profitability, declining blood donations could affect
profitability, competition may cause a loss of customer and an inability to
pass on increases in costs thereby impacting profitability, operations
depend on services of qualified professionals and competition for their
services is strong, industry regulations and standards could increase
operating costs or result in closure of operations, the discontinuation of
the operation of the Company's Florida-based research subsidiary may hinder
the Company's ability to generate profits, the decrease in reimbursement
rates may affect profitability, not-for-profit status gives advantages to
competitors, the potential inability of the Company to meet future capital
needs could impact ability to operate; reliance on relatively few vendors
for significant supplies and services could affect the Company's ability to
operate; limited access to insurance could affect ability to defend against
possible claims; future technology for blood collection and blood
replacement; potential adverse effect from changes in the healthcare
industry, including consolidations, could affect access to customers; the
ability to attract, retain and motivate management and other skilled
employees; product safety and product liability could provide exposure to
claims and litigation; targeted partner blood drives involve higher
collection costs; environmental risks could cause the Company to incur
substantial costs to maintain compliance; the threat of business
interruption due to terrorism and the security measures taken in response
to terrorism could adversely impact profitability; business interruption
due to earthquakes could adversely impact profitability; the evaluation and
consideration of strategic alternatives, and other significant projects,
may distract management from reacting appropriately to business challenges
and lead to reduced profitability; the Articles of Incorporation and
Rights Plan could delay or prevent an acquisition or sale of the Company;
quarterly revenue and operating results may fluctuate in future periods,
and the Company may fail to meet investor expectations; the Company's stock
is traded on the OTC Bulletin Board and therefore is subject to greater
market risk than those of exchange-traded stocks since they are less
liquid; the Company's stock price could be volatile; future sales of equity
securities could dilute the Company's common stock; the lack of dividend
payments could impact the price of the Company's common stock; the
evaluation of internal control and remediation of potential problems will
be costly and time consuming and could expose weaknesses in financial
reporting; and the other risks and uncertainties discussed from time to
time in the documents HemaCare files with the Securities and Exchange
Commission. Although the Company believes that the expectations reflected
in such forward-looking statements are reasonable, it can give no assurance
that such expectations will prove to be correct. Consequently, future
events and actual results could differ materially from those set forth in,
contemplated by, or underlined in the forward-looking statements contained
herein. The Company undertakes no obligation to update any of these
forward-looking statements to reflect actual results or events or
circumstances after the date hereof.
HemaCare Corporation
Condensed Consolidated Data
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
----------- ----------- ------------ -----------
Statements of
Income
(Operations):
Revenues $ 9,974,000 $ 8,961,000 $ 37,618,000 $34,166,000
Gross Profit $ 1,701,000 $ 1,684,000 $ 6,502,000 $ 5,158,000
----------- ----------- ------------ -----------
General and
administrative
expenses $ 1,513,000 $ 1,531,000 $ 5,893,000 $ 6,340,000 (1)
Other income $ - $ - $ 331,000 $ -
----------- ----------- ------------ -----------
Income (loss)
before income
taxes and
discontinued
operations $ 188,000 $ 153,000 $ 940,000 $(1,182,000)
Provision for
(benefit from)
income taxes $ (4,000) $ 23,000 $ 41,000 $ 646,000 (2)
----------- ----------- ------------ -----------
Net income (loss)
before
discontinued
operations $ 192,000 $ 130,000 $ 899,000 $(1,828,000)
----------- ----------- ------------ -----------
Income (loss) from
discontinued
operations, net
of tax impact $ (13,000) $(1,561,000) $ 80,000 $(5,960,000)
----------- ----------- ------------ -----------
Net income (loss) $ 179,000 $(1,431,000) $ 979,000 $(7,788,000)
=========== =========== ============ ===========
Basic earnings
(loss) per share $ 0.02 $ (0.16) $ 0.10 $ (0.90)
=========== =========== ============ ===========
Diluted earnings
(loss) per share $ 0.02 $ (0.16) $ 0.10 $ (0.90)
=========== =========== ============ ===========
Weighted average
shares outstanding
- basic 9,887,000 8,800,000 9,533,000 8,687,000
=========== =========== ============ ===========
Weighted average
shares outstanding
- diluted 10,103,000 8,800,000 9,706,000 8,687,000
=========== =========== ============ ===========
(1) Includes $326,000 in non-recurring severance expenses to the Company's
former Chief Executive Officer.
(2) Includes $622,000 addition to provision for income taxes from the
elimination of the deferred tax asset.
December 31, December 31,
2008 2007
----------- -----------
Balance Sheets:
Assets
Cash and cash
equivalents $ 903,000 $ 420,000
Other current assets 8,298,000 7,135,000
Non-current assets 4,495,000 4,939,000
----------- -----------
Total assets $13,696,000 $12,494,000
=========== ===========
Liabilities and
Shareholders' Equity
Current liabilities $ 8,513,000 $ 8,791,000
Long-term liabilities 645,000 631,000
Shareholders' equity 4,538,000 3,072,000
----------- -----------
Total liabilities and
shareholders' equity $13,696,000 $12,494,000
=========== ===========