American Bio Medica's net sales decrease 7.3% in fourth quarter 2013

American Bio Medica Corporation (OTCQB:ABMC) today announced financial results for the fourth quarter and year ended December 31, 2013.

Net sales in the fourth quarter of 2013 were $2,133,000 compared to $2,302,000 in the fourth quarter of 2012, a decrease of 7.3%. The Company attributes the sales decline in the fourth quarter to the inability to sell its oral fluid products in the workplace market (due to the unexpected not substantially equivalent determination by FDA in November 2013). Operating loss was $271,000 in the fourth quarter of 2013, compared to an operating loss of $501,000 in the fourth quarter of 2012. The improvement in operating results was primarily due to inventory disposals in the fourth quarter of 2012 that did not reoccur in the fourth quarter of 2013 (due to the Company's efforts to closely monitor inventory levels along with manufacturing costs), offset by increases in G&A (financing costs) and R&D (FDA compliance costs). The Company reported net income of $145,000 in the fourth quarter of 2013, compared to a net loss of $564,000 in the fourth quarter of 2012. The improvement in earnings in the fourth quarter of 2013 is due to the Company's receipt of a key man insurance benefit maintained on the Company's former CEO Stan Cipkowski.

Net sales for the year ended December 31, 2013 were 8,894,000, compared to net sales of $9,343,000 in the year ended December 31, 2012; representing a decrease of 4.8%. The sales decline was attributed to the loss of workplace oral fluid sales in the fourth quarter of 2013, and continued uncertainty in the workplace and government markets. Operating loss for the year ended December 31, 2013 was $1,131,000, compared to an operating loss of $929,000 for the year ended December 31, 2012 due to increased financing costs and share based payment (non-cash) expense in 2013. Net loss for 2013 was $788,000, compared to net loss of $1,111,000 in 2012. The earnings improvement in 2013 is primarily due to the Company's receipt of the key man insurance benefit.

ABMC interim Chief Executive Officer Melissa A. Waterhouse stated, "Late 2013 was tough for ABMC; our longtime CEO passed away suddenly, we received an unexpected NSE letter from FDA and subsequently stopped selling our oral fluid product in the workplace market. The loss of these workplace sales and increased operating expenses (a material portion of which were non-cash charges, brokers fees related to debt financings and costs related to our oral fluid marketing clearance submission), resulted in a sizeable operating loss for 2013."

Waterhouse continued, "However, in the latter part of 2013, we also commenced a number of personnel and expense cuts to improve our financial condition and cash flow. The significant savings created by these reductions are not readily apparent in our 2013 results given their timing of implementation; but they are apparent now. In 2014, we are already taking actions to bring a new urine-based drug test to the clinical and possibly consumer market, and refocusing our sales efforts on the forensic and international markets for oral fluid. We are also exploring strategic opportunities, including possible restructure of debt, which could further strengthen our financial condition. ABMC continues to run smoothly and our objective remains to move the company forward toward profitability in 2014."