MEDTOX Scientific, Inc. (MEDTOX Scientific), a US-based manufacturer of diagnostic devices, has reported revenues of $20.6 million for the first quarter of 2009, compared with the revenues of $20.7 million in the year-ago quarter. It has also reported a net income of $420,000, or $0.05 per diluted share, for the first quarter of 2009, compared with a net income of $1.6 million, or $0.18 per diluted share in the year-ago quarter.
The company recorded operating income of $0.9 million for the three-month period, compared to $2.7 million for the prior-year period.
In the company’s Laboratory Segment, revenues from drugs-of-abuse testing decreased a net 14%, to $8.4 million from $9.8 million in the prior-year period. The decrease is a result of lower testing volumes from the company workplace clients due to economic conditions. Revenues from existing clients were $7.0 million, down 28% for the quarter compared to the prior-year period. The decrease in revenue was mitigated by very strong new business from laboratory drugs-of-abuse clients of $1.4 million, or a 14% increase from the prior-year period for a total of $8.4 million. New account activity in the company drug laboratory both confirms and validates the company strategy of gaining market share and preserving the company existing clients during this recessionary period.
The clinical laboratory expansion initiated in 2008 continues to gain momentum with record revenues of $7.7 million, compared to $5.7 million for the prior-year period. This is a quarterly increase of 36%. Within the clinical laboratory, Clinical Trial Services (CTS) revenues increased to a record $2.3 million for the quarter, compared to $1.3 million for the prior-year period; and the rest of the clinical laboratory increased to $5.4 million from $4.4 million in the prior-year period. New account activity in the clinical laboratory for the quarter was encaging and continues to strengthen the company’s long term view of clinical laboratory diversification efforts.
In the Diagnostic Segment, revenues were down 13% for the quarter. The reduction in revenues is primarily due to lower testing volumes from the company workplace drugs-of-abuse clients.
There will be a continuing negative impact on the company drugs-of-abuse testing revenues caused by economic conditions affecting hiring in 2009. This should be mitigated by the company expectation of strong on-going new business activity in this market segment in 2009. Gains in drugs-of-abuse testing market share in 2007, 2008 and anticipated in 2009, will have a positive impact on the company performance when economic conditions improve and hiring rebounds, since the company client attrition rate continues to be minimal.