EX-99 2 dex99.htm PRESS RELEASE Press Release

Exhibit 99

FOR IMMEDIATE RELEASE

RETRACTABLE TECHNOLOGIES, INC. REPORTS 30.1 PERCENT INCREASE IN SALES IN THE FIRST QUARTER

LITTLE ELM, TX—May 17, 2006—Retractable Technologies, Inc. (AMEX:RVP), a leading maker of safety needle devices, today reported $5.5 million in total sales for the three months ended March 31, 2006, a 30.1 percent increase over the same period last year. This increase, which boosted gross profit for the quarter to $1.9 million from $1.5 million in the year-ago period, resulted from higher sales in the U. S. market.

Domestic sales increased 36.7 percent while international sales dropped 10.9 percent; combined unit sales for the domestic and international markets rose 16.9 percent. International sales declined in the first quarter of 2006 due to lower shipments under the Bush Administration’s global HIV/AIDS initiative compared with the same period last year. The timing of shipments, and therefore the Company’s recognition of revenues, under this program vary from quarter to quarter depending in part on logistical requirements in Africa and the Caribbean.

Largely because of a 25.3 percent increase in operating expenses, including higher sales and marketing and research and development costs in the quarter, the Company posted an operating loss of $1.2 million. The increase in sales and marketing expense resulted primarily from the hiring of additional sales personnel, whereas the increase in R&D costs was due mainly to consulting expenditures and costs associated with the development of the new VanishPoint® safety intravenous (I.V.) catheter. General and administrative costs also rose because of higher compensation, travel and legal expenses.

The Company’s balance sheet remains strong with cash making up $51.6 million, or 70.6 percent, of total assets. Further details are available on the Company’s Form 10-Q/A filed with the Securities and Exchange Commission.

Retractable Technologies, Inc. manufactures and markets VanishPoint® automated retraction safety syringes and blood collection devices, which virtually eliminate health care worker exposure to accidental needlestick injuries. These revolutionary devices use a patented friction ring mechanism that causes the contaminated needle to retract automatically from the patient into the barrel of the device, a feature that is designed to prevent reuse. VanishPoint® safety needle devices are distributed by various specialty and general line distributors. For more information on Retractable, visit our Web site at www.vanishpoint.com.

Forward-looking statements in this press release are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995 and reflect the Company’s current views with respect to future events. The Company believes that the expectations reflected in such forward-looking statements are accurate. However, the Company cannot assure you that such expectations will materialize.

The Company’s actual future performance could differ materially from such statements. Factors that could cause or contribute to such differences include, but are not limited to: the impact of dramatic increases in demand; the Company’s ability to quickly increase its capacity in the event of a dramatic increase in demand; the Company’s ability to access the market; the Company’s ability to reduce production costs; the Company’s ability to continue to finance research and development as well as operations and expansion of production; the recently increased interest of larger market players, specifically BD, in providing safety needle devices to their customers; and other risks and uncertainties that are detailed from time to time in the Company’s periodic reports filed with the Securities and Exchange Commission.

RETRACTABLE TECHNOLOGIES, INC.

CONDENSED BALANCE SHEETS

 

    

March 31,

2006

    December 31,
2005
     (Unaudited)     

ASSETS

      

Current assets:

      

Cash and cash equivalents

    $ 51,561,260    $ 52,513,935

Accounts receivable, net

      2,821,074      3,404,908

Inventories, net

      3,453,737      3,297,726

Income taxes receivable

      916,502      561,062

Current deferred tax asset

      1,135,327      1,245,508

Other current assets

      626,903      462,150
             

Total current assets

      60,514,803      61,485,289

Property, plant, and equipment, net

      12,171,697      11,925,976

Intangible assets, net

      306,512      316,926

Other assets

      26,075      27,334
             

Total assets

    $ 73,019,087    $ 73,755,525
             

LIABILITIES AND STOCKHOLDERS’ EQUITY

      

Current liabilities:

      

Accounts payable

    $ 2,381,387    $ 2,345,613

Current portion of long-term debt

      246,234      295,417

Accrued compensation

      530,508      388,726

Marketing fees payable

      1,419,760      1,419,760

Accrued royalties to a shareholder

      369,228      540,888

Other accrued liabilities

      334,729      467,812
             

Total current liabilities

      5,281,846      5,458,216

Long-term debt, net of current maturities

      4,300,638      4,350,625

Long-term deferred tax liability

      770,717      711,443
             

Total liabilities

      10,353,201      10,520,284
             

Stockholders’ equity:

      

Preferred stock $1 par value:

      

Series I, Class B

      171,000      171,000

Series II, Class B

      242,700      255,200

Series III, Class B

      135,245      135,245

Series IV, Class B

      556,000      556,000

Series V, Class B

      1,381,221      1,381,221

Common Stock, no par value

      —        —  

Additional paid-in capital

      54,350,136      54,307,053

Retained Earnings

      5,829,584      6,429,522
             

Total stockholders’ equity

      62,665,886      63,235,241
             

Total liabilities and stockholders’ equity

    $ 73,019,087    $ 73,755,525
             

RETRACTABLE TECHNOLOGIES, INC.

CONDENSED STATEMENTS OF OPERATIONS - (Unaudited)

 

     Three months ended
March 31, 2006		     Three months ended
March 31, 2005		  

Sales, net

    $ 3,881,805     $ 4,063,874  

Reimbursed discounts

      1,640,925       180,300  
                

Total sales

      5,522,730       4,244,174  
                

Cost of sales

     

Cost of manufactured product

      3,241,962       2,417,016  

Royalty expense to a shareholder

      369,228       314,619  
                

Total cost of sales

      3,611,190       2,731,635  
                

Gross profit

      1,911,540       1,512,539  
                

Operating expenses:

     

Sales and marketing

      1,113,006       940,383  

Research and development

      315,195       119,094  

General and administrative

      1,723,771       1,455,782  
                

Total operating expenses

      3,151,972       2,515,259  
                

Loss from operations

      (1,240,432 )     (1,002,720 )

Interest income

      462,197       252,139  

Interest expense, net

      (110,707 )     (62,413 )
                

Net loss before income taxes

      (888,942 )     (812,994 )

Provision (benefit) for income taxes

      (289,004 )     (290,059 )
                

Net loss

      (599,938 )     (522,935 )

Preferred Stock dividend requirements

      (367,078 )     (381,345 )
                

Loss applicable to common shareholders

    $ (967,016 )   $ (904,280 )
                

Loss per share - basic and diluted

    $ (0.04 )   $ (0.04 )
                

Weighted average common shares outstanding

      23,521,551       23,203,665  
                

Investor Contact:

Douglas W. Cowan

Vice President and Chief Financial Officer

(888) 806-2626 or (972) 294-1010

rtifinancial@vanishpoint.com

Media Contact:

Phillip L. Zweig

Communications Director

(212) 490-0811 or (214) 912-7415 (cell)

plzweig