Elite Pharmaceuticals reports decrease in manufacturing revenue for fiscal first quarter

Aug 17 2010

Elite Pharmaceuticals, Inc. (OTCBB:ELTP), a specialty pharmaceutical company dedicated to developing and commercializing oral sustained and controlled release product formulations, announced results for the fiscal first quarter ended June 30, 2010.

Consolidated revenues for the first quarter of fiscal 2011 were $831,920 compared to $813,875 for the first quarter of fiscal 2010.  All revenues are derived from the manufacture and sale of the Lodrane family of products. Manufacturing revenues were $567,069 compared to $665,064 in first quarter of fiscal 2010. Manufacturing revenues were lower due to timing differences in batch manufacturing and shipments.  For the first time the company recorded revenues of $83,817 from lab fees which consist of product stability testing services for the Lodrane products. There was no such revenue in last year's first fiscal quarter. This is a new source of revenue for the company and is expected to continue going forward.  Royalty revenue of $181,034 increased 22% over last year's royalty revenue of $148,811 due to growth in sales of the products. Loss from operations for the first quarter of fiscal 2011 was $96,769 compared to a loss of $876,659 for the same period in fiscal 2010. The decrease in loss from operations represents the efforts by management to increase manufacturing efficiency and reduce operating costs. Basic GAAP net loss per share was ($0.05) for first quarter of fiscal 2011 and is primarily due to $4.7 million in non-cash expenses related to the accounting treatment of preferred share derivatives and the fair value of warrant derivatives. This charge will vary depending on the price of the company's common shares at the end of each quarter.

Cash flow from operations, which excludes non-cash charges for depreciation and amortization and compensation, was a positive $50,151 for the first quarter of fiscal 2011 compared to a negative ($479,161) for the comparable period in fiscal 2010. Cash as of June 30, 2010 was $389,884.