EX-99.1 2 ex99_1.htm EXHIBIT 99.1
Exhibit 99.1


Chembio Diagnostics Reports Second Quarter 2018 Financial Results
 
MEDFORD, NY, August 8, 2018 -- Chembio Diagnostics, Inc. (Nasdaq: CEMI), a leader in point-of-care diagnostic testing, today reported financial results for the second quarter ended June 30, 2018.

Recent Accomplishments & Highlights
·
Achieved total revenue of $8.7 million, including net product sales of $6.9 million, for the second quarter 2018, representing increases of 112% and 137%, respectively, compared to the prior year period.
·
Advanced to Phase 2 in the AstraZeneca-funded collaboration to develop a DPP® Assay that identifies an “undisclosed” biomarker.
·
Entered collaboration with the Foundation for Innovative New Diagnostics (FIND) to expedite the feasibility testing of a rapid diagnostic test for hepatitis C virus.
·
Installed the first automated manufacturing line in New York facility which will reduce cost and increase capacity.
·
Submitted a dossier to the World Health Organization (WHO) for the prequalification of the Malaysia facility which upon approval will allow manufacturing transfer of certain products.

“We closed the first half of 2018 with strong revenue growth and performance across the board.  During the second quarter we executed in our core business and advanced product development and technology collaborations,” said John Sperzel, Chembio’s Chief Executive Officer. “With the patented DPP® platform as our foundation, we are expanding our commercial and manufacturing capabilities and strengthening our leadership team to further penetrate the global point-of-care diagnostics market.”

Second Quarter 2018 Financial Results
Total revenue for the second quarter of 2018 was $8.7 million, an increase of 112% compared to the second quarter of 2017. Net product sales for the second quarter of 2018 were $6.9 million, an increase of 137% compared to the second quarter of 2017.  License and royalty and R&D, milestone and grant revenue for the second quarter of 2018 was $1.9 million, an increase of 52% compared to the second quarter of 2017.

Gross product margin for the second quarter of 2018 was $0.9 million, an increase of 34% compared to the second quarter of 2017. Gross product margin percent for the second quarter of 2018 was 14% compared to 24% for the second quarter of 2017. The lower gross product margin percent for the 2018 second quarter resulted primarily from sales growth in markets with lower average selling prices and costs to ramp-up production volumes to new corporate levels.

Research and Development expenses were essentially flat for the three months ended June 30, 2018 compared to the three months ended June 30, 2017. Selling, General and Administrative expenses increased by $0.4 million, or 21% for the three months ended June 30, 2018 compared to the three months ended June 30, 2017. The increase is primarily associated with higher sales commissions and compensation expense related to the 137% increase in net product sales volume.

Net loss for the second quarter of 2018 was $1.7 million, or $0.12 per diluted share, compared with a net loss of $2.2 million, or $0.18 per diluted share, for the second quarter of 2017.
 
Cash and cash equivalents as of June 30, 2018 totaled $9.5 million.

Conference Call
Chembio will host a conference call today beginning at 4:30pm ET to discuss financial results and recent business highlights. Investors interested in listening to the call may do so by dialing (877) 407-0778 from the U.S. or (201) 689-8565 from outside the U.S.  To listen to a live webcast, please visit the Investor Relations section of Chembio's website at www.chembio.com. Following the call, a replay will be available on the Investor Relations section of the company’s website for 90 days. A telephone replay will be available by dialing (877) 481-4010 from the U.S. or (919) 882-2331 from outside the U.S. using the conference ID: 34609 until 4:30pm ET on August 15, 2018.

About Chembio Diagnostics
Chembio is a leading point-of-care diagnostics company focused on detecting and diagnosing infectious diseases. The company’s patented DPP® technology platform, which uses a small drop of blood from the fingertip, provides high-quality, cost-effective results in 15-20 minutes. Coupled with Chembio’s extensive scientific expertise, its novel DPP® technology offers broad market applications beyond infectious disease, a number of which are under active development with collaboration partners. Chembio’s products are sold globally, directly and through distributors, to hospitals and clinics, physician offices, clinical laboratories, public health organizations, government agencies, and consumers. Learn more at www.chembio.com.

Forward-Looking Statements
Statements contained herein that are not historical facts may be forward-looking statements within the meaning of the Securities Act of 1933, as amended. Forward-looking statements include statements regarding the intent, belief or current expectations of the Company and its management. Such statements, which are estimates only, reflect management's current views, are based on certain assumptions, and involve risks and uncertainties. Actual results, events, or performance may differ materially from the above forward-looking statements due to a number of important factors, and will be dependent upon a variety of factors, including, but not limited to Chembio's ability to obtain additional financing and to obtain regulatory approvals in a timely manner, as well as the demand for Chembio's products. Chembio undertakes no obligation to publicly update these forward-looking statements to reflect events or circumstances that occur after the date hereof or to reflect any change in Chembio's expectations with regard to these forward-looking statements or the occurrence of unanticipated events. Factors that may impact Chembio's success are more fully disclosed in Chembio's most recent public filings with the U.S. Securities and Exchange Commission.

(Tables to follow)

Investor Relations Contact
Lynn Pieper Lewis
Gilmartin Group
(415) 937-5402
investor@chembio.com 
 
CHEMBIO DIAGNOSTICS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

   
For the three months ended
    
For the six months ended
  
   
June 30, 2018
    
June 30, 2017
    
June 30, 2018
    
June 30, 2017
  
REVENUES:
                        
Net product sales
  
$
6,857,861
    
$
2,892,942
    
$
13,256,088
    
$
8,320,314
  
License and royalty revenue
    
276,526
      
227,635
      
478,457
      
327,689
  
R&D, milestone and grant revenue
    
1,585,939
      
994,237
      
2,702,913
      
1,791,977
  
TOTAL REVENUES
    
8,720,326
      
4,114,814
      
16,437,458
      
10,439,980
  
                                 
COSTS AND EXPENSES:
                                
Cost of product sales
    
5,935,428
      
2,203,843
      
10,053,207
      
5,423,057
  
Research and development expenses
    
1,991,412
      
1,982,426
      
3,838,514
      
4,228,998
  
Selling, general and administrative expenses
    
2,547,216
      
2,109,360
      
4,953,785
      
4,597,696
  
     
10,474,056
      
6,295,629
      
18,845,506
      
14,249,751
  
LOSS FROM OPERATIONS
    
(1,753,730
)
    
(2,180,815
)
    
(2,408,048
)
    
(3,809,771
)
                                 
OTHER INCOME:
                                
Interest income, net
    
25,355
      
7,722
      
27,330
      
21,104
  
                                 
LOSS BEFORE INCOME TAXES
    
(1,728,375
)
    
(2,173,093
)
    
(2,380,718
)
    
(3,788,667
)
                                 
Income tax provision
    
-
      
-
      
-
      
-
  
                                 
NET LOSS
  
$
(1,728,375
)
  
$
(2,173,093
)
  
$
(2,380,718
)
  
$
(3,788,667
)
                                 
Basic and diluted loss per share
  
$
(0.12
)
  
$
(0.18
)
  
$
(0.17
)
  
$
(0.31
)
                                 
Weighted average number of shares outstanding, basic and diluted
    
14,165,343
      
12,299,122
      
13,718,776
      
12,284,979
  
 
CHEMBIO DIAGNOSTICS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF
 
   
June 30, 2018
      
December 31, 2017
  
   
(Unaudited)
          
- ASSETS -
              
CURRENT ASSETS:
              
Cash and cash equivalents
  
$
9,505,782
    
$
3,790,302
  
Accounts receivable, net
    
6,886,319
      
2,085,340
  
Inventories, net
    
6,349,640
      
4,423,618
  
Prepaid expenses and other current assets
    
788,740
      
554,383
  
TOTAL CURRENT ASSETS
    
23,530,481
      
10,853,643
  
                 
FIXED ASSETS, net
    
2,371,509
      
1,909,232
  
                 
OTHER ASSETS:
                
Intangible assets, net
    
1,515,112
      
1,597,377
  
Goodwill
    
1,673,144
      
1,666,610
  
Deposits and other assets
    
357,385
      
589,159
  
                 
TOTAL ASSETS
  
$
29,447,631
    
$
16,616,021
  
                 
- LIABILITIES AND STOCKHOLDERS’ EQUITY -
                
CURRENT LIABILITIES:
                
Accounts payable and accrued liabilities
  
$
6,010,454
    
$
3,046,303
  
Deferred revenue
    
660,750
      
50,000
  
TOTAL CURRENT LIABILITIES
    
6,671,204
      
3,096,303
  
                 
OTHER LIABILITIES:
                
Note payable
    
426,550
      
99,480
  
Deferred tax liability
    
342,379
      
341,042
  
TOTAL LIABILITIES
    
7,440,133
      
3,536,825
  
                 
TOTAL STOCKHOLDERS’ EQUITY
    
22,007,498
      
13,079,196
  
                 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
  
$
29,447,631
    
$
16,616,021
  
 
CHEMBIO DIAGNOSTICS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 
   
For the six months ended
  
   
June 30, 2018
    
June 30, 2017
  
             
Net cash used in operating activities
  
$
(5,077,668
)
  
$
(5,456,787
)
Net cash used in investing activities
    
(250,147
)
    
(1,405,894
)
Net cash provided by financing activities
    
11,006,266
      
-
  
Effect of exhange rate changes on cash
    
37,029
      
-
  
INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS
    
5,715,480
      
(6,862,681
)
Cash and cash equivalents - beginning of the period
    
3,790,302
      
10,554,464
  
Cash and cash equivalents - end of the period
  
$
9,505,782
    
$
3,691,783