MEDTOX Scientific Announces Record First Quarter; Strong Sales and Earnings Growth Achieved Despite a Slowing Economy

Apr 19, 2001, 01:00 ET from MEDTOX Scientific, Inc.

    ST. PAUL, Minn., April 19 /PRNewswire/ --
     MEDTOX Scientific, Inc. (Amex:   TOX)
     -- First quarter consolidated sales increased 20%
     -- Diagnostics segment sales increased 66%
     -- Consolidated net income increased 48%
 
     MEDTOX Scientific, Inc., announced record revenues and net income for the
 first quarter ended March 31, 2001.  For the three-month period, revenues
 increased 20% to $11,606,000 compared to $9,676,000 for the prior-year period.
 Operating income increased to $703,000 from $525,000 in the first quarter of
 2000.  Net income increased 48% to $438,000, or 12 cents per diluted share,
 compared to net income of $297,000, or 10 cents per diluted share, in the
 first quarter of 2000.
     "We continue to maintain our focus on increasing sales, managing expenses
 and investing in future growth," said Richard Braun, MEDTOX chief executive
 officer.  "Selling, general and administrative expenses in the first quarter
 of 2001 decreased as a percentage of sales to 27% from 29% in the same quarter
 in 2000.  In the first quarter we closed on the acquisition of the
 three-building, 129,000 square foot complex in Minnesota where our laboratory
 segment currently occupies 54,000 square feet.  Not only does this provide
 capacity for future growth, but our overall occupancy cost as the owner will
 be slightly lower on the total complex than our previous rental expense as a
 tenant.
     "The 66% increase in MEDTOX Diagnostics sales compared to the first
 quarter of 2000 is largely attributable to sales of the PROFILE(R)-II Test
 System and our expanding VERDICT(R)-II product line.  The FDA cleared the
 PROFILE(R)-II ER product for sale in February, which was later than we had
 anticipated.  A small amount of the PROFILE(R)-II ER product was shipped in
 the first quarter.  We have increased our efforts to compensate for the delay
 in PROFILE(R)-II ER product sales.  In recent weeks our sales group has
 contacted over 3,000 hospitals and provided them with product information and
 product samples.  Marketplace reaction has been positive, and we continue to
 respond to requests for additional information.
     "The steps we have taken to reorganize laboratory operations, reduce costs
 and expand our esoteric laboratory business resulted in a strong quarter for
 the laboratory segment.  Sample volume from our occupational health, wellness
 and esoteric testing clients increased 40% compared to the first quarter of
 2000.  Our R&D group is continually improving and adding to the over 900
 proprietary bio-analytical assays they have developed.  In the past these
 tests have largely been marketed to hospitals, clinics and other laboratories.
 More recently we have increased our efforts to apply our assay development
 skills to the bio-analytical needs of the pharmaceutical market.  The slowing
 economy and our planned emphasis on the PROFILE(R)-II Test System for on-site
 drugs-of-abuse (DAU) screening slowed the growth of laboratory DAU sample
 volume.  But overall, we are pleased with our progress in the laboratory area
 during the first quarter of 2001.
     "We remain optimistic and committed to building MEDTOX Scientific in areas
 of expertise that have higher growth and margin potential.  We remain truly
 excited about the potential we are realizing and see ahead for this company."
     MEDTOX Scientific, Inc., headquartered in St. Paul, Minn., is a provider
 of high quality esoteric laboratory and on-site/point-of-care testing devices.
 The company also supports customers with complete logistics, data and program
 management services.  MEDTOX develops and manufactures diagnostic devices for
 quick and economical on-site/ point-of-care analysis for drugs of abuse,
 therapeutic drugs and agricultural toxins and provides employment drug
 screening and occupational health testing.  MEDTOX is also a leader in
 providing esoteric testing services to hospitals and laboratories nationwide.
 For more information see http://www.medtox.com
 
     Note:  Forward-looking statements contained in this press release are made
 under the Private Securities Reform Act of 1995.  Actual results may differ.
 Certain factors that may cause such results to differ are identified on page
 three of the company's Annual Report on Form 10-K for the year ended
 December 31, 2000 and incorporated herein by reference.
 
 
                            MEDTOX SCIENTIFIC, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                    (In thousands except per share amounts)
                                  (Unaudited)
 
 
                                                        Three Months Ended
                                                 March 31, 2001  March 31, 2000
 
     REVENUES:
       Laboratory service revenues                     $9,304        $ 8,285
       Product sales                                    2,302          1,391
                                                       11,606          9,676
     COST OF REVENUES:
       Cost of services                                 6,395          5,541
       Cost of sales                                    1,053            563
                                                        7,448          6,104
 
     GROSS PROFIT                                       4,158          3,572
 
     OPERATING EXPENSES:
       Selling, general and administrative              3,140          2,798
       Research and development                           315            249
                                                        3,455          3,047
 
     INCOME FROM OPERATIONS                               703            525
 
     OTHER INCOME (EXPENSE):
       Interest expense                                  (240)          (228)
       Net other expense                                  (25)            --
                                                         (265)          (228)
 
     NET INCOME                                          $438           $297
 
     BASIC EARNINGS PER COMMON SHARE                    $0.12          $0.10
 
     DILUTED EARNINGS PER COMMON SHARE                  $0.12          $0.10
 
 

SOURCE MEDTOX Scientific, Inc.
    ST. PAUL, Minn., April 19 /PRNewswire/ --
     MEDTOX Scientific, Inc. (Amex:   TOX)
     -- First quarter consolidated sales increased 20%
     -- Diagnostics segment sales increased 66%
     -- Consolidated net income increased 48%
 
     MEDTOX Scientific, Inc., announced record revenues and net income for the
 first quarter ended March 31, 2001.  For the three-month period, revenues
 increased 20% to $11,606,000 compared to $9,676,000 for the prior-year period.
 Operating income increased to $703,000 from $525,000 in the first quarter of
 2000.  Net income increased 48% to $438,000, or 12 cents per diluted share,
 compared to net income of $297,000, or 10 cents per diluted share, in the
 first quarter of 2000.
     "We continue to maintain our focus on increasing sales, managing expenses
 and investing in future growth," said Richard Braun, MEDTOX chief executive
 officer.  "Selling, general and administrative expenses in the first quarter
 of 2001 decreased as a percentage of sales to 27% from 29% in the same quarter
 in 2000.  In the first quarter we closed on the acquisition of the
 three-building, 129,000 square foot complex in Minnesota where our laboratory
 segment currently occupies 54,000 square feet.  Not only does this provide
 capacity for future growth, but our overall occupancy cost as the owner will
 be slightly lower on the total complex than our previous rental expense as a
 tenant.
     "The 66% increase in MEDTOX Diagnostics sales compared to the first
 quarter of 2000 is largely attributable to sales of the PROFILE(R)-II Test
 System and our expanding VERDICT(R)-II product line.  The FDA cleared the
 PROFILE(R)-II ER product for sale in February, which was later than we had
 anticipated.  A small amount of the PROFILE(R)-II ER product was shipped in
 the first quarter.  We have increased our efforts to compensate for the delay
 in PROFILE(R)-II ER product sales.  In recent weeks our sales group has
 contacted over 3,000 hospitals and provided them with product information and
 product samples.  Marketplace reaction has been positive, and we continue to
 respond to requests for additional information.
     "The steps we have taken to reorganize laboratory operations, reduce costs
 and expand our esoteric laboratory business resulted in a strong quarter for
 the laboratory segment.  Sample volume from our occupational health, wellness
 and esoteric testing clients increased 40% compared to the first quarter of
 2000.  Our R&D group is continually improving and adding to the over 900
 proprietary bio-analytical assays they have developed.  In the past these
 tests have largely been marketed to hospitals, clinics and other laboratories.
 More recently we have increased our efforts to apply our assay development
 skills to the bio-analytical needs of the pharmaceutical market.  The slowing
 economy and our planned emphasis on the PROFILE(R)-II Test System for on-site
 drugs-of-abuse (DAU) screening slowed the growth of laboratory DAU sample
 volume.  But overall, we are pleased with our progress in the laboratory area
 during the first quarter of 2001.
     "We remain optimistic and committed to building MEDTOX Scientific in areas
 of expertise that have higher growth and margin potential.  We remain truly
 excited about the potential we are realizing and see ahead for this company."
     MEDTOX Scientific, Inc., headquartered in St. Paul, Minn., is a provider
 of high quality esoteric laboratory and on-site/point-of-care testing devices.
 The company also supports customers with complete logistics, data and program
 management services.  MEDTOX develops and manufactures diagnostic devices for
 quick and economical on-site/ point-of-care analysis for drugs of abuse,
 therapeutic drugs and agricultural toxins and provides employment drug
 screening and occupational health testing.  MEDTOX is also a leader in
 providing esoteric testing services to hospitals and laboratories nationwide.
 For more information see http://www.medtox.com
 
     Note:  Forward-looking statements contained in this press release are made
 under the Private Securities Reform Act of 1995.  Actual results may differ.
 Certain factors that may cause such results to differ are identified on page
 three of the company's Annual Report on Form 10-K for the year ended
 December 31, 2000 and incorporated herein by reference.
 
 
                            MEDTOX SCIENTIFIC, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                    (In thousands except per share amounts)
                                  (Unaudited)
 
 
                                                        Three Months Ended
                                                 March 31, 2001  March 31, 2000
 
     REVENUES:
       Laboratory service revenues                     $9,304        $ 8,285
       Product sales                                    2,302          1,391
                                                       11,606          9,676
     COST OF REVENUES:
       Cost of services                                 6,395          5,541
       Cost of sales                                    1,053            563
                                                        7,448          6,104
 
     GROSS PROFIT                                       4,158          3,572
 
     OPERATING EXPENSES:
       Selling, general and administrative              3,140          2,798
       Research and development                           315            249
                                                        3,455          3,047
 
     INCOME FROM OPERATIONS                               703            525
 
     OTHER INCOME (EXPENSE):
       Interest expense                                  (240)          (228)
       Net other expense                                  (25)            --
                                                         (265)          (228)
 
     NET INCOME                                          $438           $297
 
     BASIC EARNINGS PER COMMON SHARE                    $0.12          $0.10
 
     DILUTED EARNINGS PER COMMON SHARE                  $0.12          $0.10
 
 SOURCE  MEDTOX Scientific, Inc.