EX-99.1 2 v125854_ex99-1.htm Unassociated Document
Exhibit 99.1



Contact:    Daniel C. Dunn     
   Chief Financial Officer
   314/771-2400


Allied Healthcare Net Declines
Due to Manufacturing Delays, Higher Costs
 

ST. LOUIS, SEPTEMBER 4, 2008 - Allied Healthcare Products, Inc. (NASDAQ: AHPI) reported that its net income for the fourth quarter ending June 30 fell about 21 percent, from about $870,000 last year, or 11 cents per share, to about $690,000 in the current quarter, or 9 cents per basic share, due to slight delays in manufacturing and higher material and labor costs.

Sales for the fourth quarter increased by about 4.6 percent, or almost $650,000, compared to the fourth quarter of last year. However, Allied sales for the fiscal year tracked very closely with the previous year, totaling about $56.4 million for 2008 and $56.5 million for 2007.

Sales revenue for 2008 included $1.2 million as a result of a 2004 agreement with Abbott Laboratories to reimburse certain Research and Development costs related to new CO2 absorbent techniques. Sales for 2007 included about $584,000 in reimbursement from that agreement. Sales for the fourth quarter of 2008 included $525,000 in reimbursement of Research and Development cost, versus $134,000 for 2007.
 
For the fiscal year ending June 30, Allied net income fell about 46 percent, from about $1.64 million last year, or 21 cents per basic share, to about $882,000, or 11 cents per share, in 2008.
 
 
 
 
 
Manufacturing delays meant that some customer orders were not filled and could not be translated into sales revenue in 2008. Also, material costs - primarily metals and oil-based resins - increased by about 2 percent and labor costs by about 3.8 percent over fiscal 2007. A modest overall price increase by Allied could not offset the year’s higher material and labor costs.

Manufacturing productivity programs planned for fiscal 2008 were not implemented as quickly as anticipated. However, these programs are proceeding and will result in cost reductions and improved throughput in fiscal 2009, according to Earl Refsland, Allied president and chief executive officer.

Despite problems in the year, positive cash flow of about $2.5 million increased Allied’s cash position to about $6.1 million at the end of the fiscal year, Refsland said.

Allied Healthcare Products, Inc. is a leading manufacturer of respiratory care products, medical gas equipment and emergency medical products used in a wide range of alternate care settings.


“SAFE HARBOR” STATEMENT: Statements contained in this release that are not historical facts or information are “forward-looking statements.” Words such as “believe,” “expect,” “intend,” “will,” “should,” and other expressions that indicate future events and trends identify such forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause the outcome and future results of operations and financial condition to be materially different than stated or anticipated based on the forward-looking statements. Such risks and uncertainties include both general economic risks and uncertainties, risks and uncertainties affecting the demand for and economic factors affecting the delivery of health care services, and specific matters which relate directly to the Company’s operations and properties as discussed in its periodic filings with the Securities and Exchange Commission. The Company cautions that any forward-looking statement contained in this report reflects only the belief of the Company or its management at the time the statement was made. Although the Company believes such forward-looking statements are based upon reasonable assumptions, such assumptions may ultimately prove inaccurate or incomplete. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement was made.


##

 
 
 
 
ALLIED HEALTHCARE PRODUCTS, INC.
  
CONSOLIDATED STATEMENT OF OPERATIONS
  
(UNAUDITED)
  
   
   
Three months ended,
  
Twelve months ended,
  
   
June 30,
  
June 30,
  
   
2008
  
2007
  
2008
  
2007
  
                   
Net sales
  
$
14,692,626
  
$
14,045,798
  
$
56,364,111
  
$
56,500,974
  
Cost of sales
    
10,577,599
   
10,061,519
   
43,006,007
   
42,028,125
 
Gross profit
    
4,115,027
   
3,984,279
   
13,358,104
   
14,472,849
 
                       
                           
Selling General and administrative expenses
    
3,096,161
   
2,765,157
   
12,084,971
   
12,051,500
 
Income from operations
    
1,018,866
   
1,219,122
   
1,273,133
   
2,421,349
 
                           
                           
Interest income
    
(25,245
)
  
(28,719
)
  
(118,119
)
  
(110,790
)
Other, net
    
24,501
   
10,710
   
60,005
   
(23,841
)
     
(744
)
  
(18,009
)
  
(58,114
)
  
(134,631
)
                           
Income before provision
                          
for income taxes
    
1,019,610
   
1,237,131
   
1,331,247
   
2,555,980
 
                           
Provision for income taxes
    
330,327
   
368,019
   
448,748
   
914,400
 
Net income
  
$
689,283
  
$
869,112
  
$
882,499
  
$
1,641,580
  
                           
                           
Net income per share - Basic
  
$
0.09
  
$
0.11
  
$
0.11
  
$
0.21
  
                           
Net income per share - Diluted
  
$
0.08
  
$
0.11
  
$
0.11
  
$
0.20
  
                           
Weighted average common shares
                  
Outstanding - Basic
    
7,883,907
   
7,883,577
   
7,883,659
   
7,875,982
 
                           
Weighted average common shares
                          
Outstanding - Diluted
    
8,124,826
   
8,111,872
   
8,119,776
   
8,085,375
 
 
 
 
 
 
 
   
   
ALLIED HEALTHCARE PRODUCTS, INC.
  
CONSOLIDATED BALANCE SHEET
  
 (UNAUDITED)
  
           
   
June 30, 2008
  
June 30, 2007
  
ASSETS
          
Current assets:
          
Cash and cash equivalents
  
$
6,149,015
  
$
3,638,870
  
Accounts receivable, net of allowances
              
of $300,000 and $460,000, respectively
    
6,441,683
   
7,251,767
 
Inventories, net
    
12,046,450
   
12,999,472
 
Other current assets
    
394,975
   
275,254
 
Total current assets
    
25,032,123
   
24,165,363
 
Property, plant and equipment, net
    
10,542,573
   
10,677,000
 
Goodwill
    
15,979,830
   
15,979,830
 
Other assets, net
    
703,328
   
496,127
 
Total assets
  
$
52,257,854
  
$
51,318,320
  
               
LIABILITIES AND STOCKHOLDERS' EQUITY
              
Current liabilities:
              
Accounts payable
  
$
2,590,804
  
$
3,040,313
  
Other accrued liabilities
    
2,960,334
   
2,508,820
 
Deferred income taxes
    
500,238
   
882,001
 
Deferred revenue
    
690,000
   
465,000
 
Total current liabilities
    
6,741,376
   
6,896,134
 
               
Deferred revenue
    
2,177,500
   
1,937,500
 
               
Commitments and contingencies
              
               
Stockholders' equity:
              
Preferred stock; $0.01 par value; 1,500,000 shares
              
authorized; no shares issued and outstanding
    
-
   
-
 
Series A preferred stock; $0.01 par value; 200,000 shares
              
authorized; no shares issued and outstanding
    
-
   
-
 
Common stock; $0.01 par value; 30,000,000 shares authorized;
              
10,188,569 and 10,187,069 shares issued at June 30, 2008
              
and June 30, 2007; respectively. 7,885,077 and 7,883,577
             
outstanding at June 30, 2008 and June 30, 2007, respectively.
    
101,886
   
101,871
 
Additional paid-in capital
    
47,524,084
   
47,441,163
 
Retained earnings
    
16,444,436
   
15,673,080
 
Less treasury stock, at cost; 2,303,492 shares at
              
June 30, 2008 and June 30, 2007, respectively
    
(20,731,428
)
  
(20,731,428
)
Total stockholders' equity
    
43,338,978
   
42,484,686
 
Total liabilities and stockholders' equity
  
$
52,257,854
  
$
51,318,320