Puricore reports increase in sales of 25% in Q3

PuriCoreNov 3 2009

PuriCore (LSE: PURI), the life sciences company focused on developing and commercializing proprietary, green solutions that safely, effectively, and naturally kill infectious pathogens without causing harm to human health or the environment, today issues an Interim Management Statement covering the three-month and nine-month periods ending September 30, 2009.

Financial Results (unaudited)

• Q3 sales of $10.6 million (2008: $8.4 million), an increase of 25% (35% increase at constant currency)
  • US Food Safety revenue increased 10% to $5.8 million
  • UK Endoscopy (including Sterilox business and Labcaire Systems) revenue increased 52% to $4.6 million (78% at constant currency); Labcaire Systems revenue for the period 5 August to 30 September 2009 totaled $2.5 million
• Sales for the nine months ending September 30 of $29.6 million (2008: $27.9 million), an increase of 6% (17% increase at constant currency)
  • US Food Safety revenue increased 14% to $18.5 million
  • UK Endoscopy revenue decreased by 5% to $10.8 million (20% increase at constant currency)
• Cash of $8.4 million at period end

Q3 Operational Highlights

• Completed the acquisition of Labcaire Systems Ltd., a leading UK supplier and manufacturer of endoscope disinfection equipment, which is performing ahead of internal expectations
• Raised £2 million by way of a Placing through the issue of 10,810,811 Placing Shares at an Issue Price of 18.5 pence per share to fund the upfront payment for the Labcaire acquisition
• Established a new $2.1 million debt facility consistent with the Company’s strategy to utilize debt to fund the installation of leased Sterilox Food Safety Systems
• Received a new FDA 510(k) clearance for Vashe Wound Therapy extending shelf-life claims

Post-Period Developments

• Signed major contracts with another top-10 US national supermarket chain and another leading regional supermarket retailer for Sterilox Food Safety Systems to be installed in 2010 totaling approximately $4.7 million in lease revenues
• Completed a randomized clinical trial on the effectiveness of Vashe Wound Therapy on post-operative, split-thickness skin grafts for burn injuries with positive clinical results expected to be presented in early November
• Promoted Darren Weiss to CFO and Executive Director effective November 1, 2009

Outlook

Results for Q3 2009 were strong despite the weakness of UK sterling (compared with Q3 2008 and 30 September YTD 2008), driven by the growth in PuriCore’s US Food Safety core business, with approximately 50 US supermarket chains using Sterilox as at 30 September 2009, as well as by the incremental revenue achieved by Labcaire for the UK Endoscopy core business, which exceeded internal expectations. The Company remains on target with plans for the integration of Labcaire into the PuriCore UK Endoscopy business and for continuing to control operating expenses throughout the Company for the full year. PuriCore continues to successfully shift the business toward a lease versus capital sales model and expects this to continue in 2010.

Greg Bosch, Chief Executive Officer of PuriCore, said:

“The continued market adoption of our Sterilox Food Safety Systems is further evidenced by the recent contract awards from two additional leading customers, including another top-10 retailer. The acquisition of Labcaire positions PuriCore as the leading provider of endoscope reprocessing products and services for our UK customers with a broad portfolio, and we look to expand our marketing of Labcaire products internationally in 2010.”