Psychemedics Corporation Announces 2010 Year End Profits

DECLARES QUARTERLY DIVIDEND

Mar 02, 2011, 11:22 ET from Psychemedics Corporation

ACTON, Mass., March 2, 2011 /PRNewswire/ -- Psychemedics Corporation (Nasdaq: PMD) today announced fourth quarter and year-end financial results for the period ended December 31, 2010.  The Company also announced a quarterly dividend of $0.12 per share payable to shareholders of record as of March 11, 2011 to be paid on March 25, 2011.  This will be the Company's 58th consecutive quarterly dividend.

The Company's revenue for the year ended December 31, 2010 was $20.1 million, an increase of 19% as compared to $17.0 million for 2009.  Net income for the year ended December 31, 2010 was $2.6 million or $0.50 per share, an increase of 71% from 2009 during which the Company earned $1.5 million or $0.29 per share.  Revenue for the fourth quarter was $5.1 million, an increase of 20% as compared to $4.3 million the fourth quarter of 2009.  Net income for the quarter was $417 thousand or $0.08 per share, down 24% from $546 thousand or $0.10 per share for the same period of 2009.

Raymond C. Kubacki, Chairman and Chief Executive Officer, said, "In 2010, sales and profits were back on the growth track.  While we are very proud that we have been profitable every year since 1993, including the severe 2009 recession, our focus continues to be sales and earnings growth.  While some of our growth in 2010 can be attributed to the economic recovery, the primary increase has come from new customers and introducing new programs to existing customers."  

Kubacki continued: "Beyond the strong financial performance of 2010, the Company has invested in its future with the addition of two new officers in the Company (Corporate VP – Sales & Marketing and VP – Controller) as well as an enhanced sales team.  Despite the tough environment, we continued to bring on new clients, including expanding internationally, with sales/marketing agreements made for the UK and Europe, which will set the foundation for future revenue growth.  We have also improved our internet presence with a complete overhaul of our website and continue to expand our e-commerce platform."

Kubacki concluded, "The Company's balance sheet remains strong with approximately $5.7 million in cash and short-term investments and no long-term debt.  Our directors share our confidence in the future of Psychemedics and remain committed to rewarding shareholders and sharing the financial success of the Company with them as we grow.  Therefore, we are pleased to declare our fifty-eighth consecutive quarterly dividend."

Psychemedics is the world's largest provider of hair testing for drugs of abuse with thousands of corporations relying on the patented Psychemedics drug testing services.  Psychemedics' clients include over 10% of the Fortune 500, some of the largest police departments in America and six Federal Reserve Banks.    

The Psychemedics web site is www.psychemedics.com  

Cautionary Statement for purposes of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995:  From time to time, information provided by Psychemedics may contain forward-looking information that involves risks and uncertainties.  In particular, statements contained in this release that are not historical facts (including but not limited to statements concerning earnings, earnings per share, revenues, dividends, future business, new accounts, customer base, market share, test volume and sales and marketing strategies) may be "forward looking" statements.  Actual results may differ from those stated in any forward-looking statements.  Factors that may cause such differences include but are not limited to risks associated with the expansion of the Company's sales and marketing network, development of markets for new products and services offered, the economic health of principal customers of the Company, government regulation, including but not limited to FDA regulations, competition and general economic conditions and other factors disclosed in the Company's filings with the Securities and Exchange Commission.

Psychemedics Corporation

Statements of Income

Unaudited

December 31,

December 31,

2010

2009

ASSETS

Current Assets:

  Cash and cash equivalents

$3,720,488

$4,840,367

  Short-term investments

2,018,452

1,006,436

  Accounts receivable, net of allowance for doubtful accounts

3,905,821

3,016,084

      of $119,295 in 2010 and $134,282 in 2009

  Prepaid expenses and other current assets

700,822

663,433

  Deferred tax assets  

239,831

253,221

Total Current Assets

10,585,414

9,779,541

Fixed Assets:

  Equipment & leasehold improvements

11,730,866

10,912,906

  Less accumulated depreciation

(10,663,996)

(10,381,599)

Net Fixed Assets

1,066,870

531,307

  Deferred tax assets, long term

-

204,764

  Other assets

114,037

86,814

Total Assets

$ 11,766,321

$ 10,602,426

LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities:

  Accounts payable

$699,833

$180,784

  Accrued expenses

1,302,370

1,090,898

  Deferred revenue

16,605

36,360

Total Current Liabilities

2,018,808

1,308,042

Shareholders' Equity:

  Preferred-stock, $0.005 par value, 872,521 shares authorized,

--

--

       no shares issued or outstanding

  Common stock, $0.005 par value; 50,000,000 shares authorized

29,387

29,309

      5,877,358 shares issued in 2010 and 5,861,872 shares issued in 2009

  Paid-in capital

27,764,992

27,419,359

  Accumulated deficit

(7,987,468)

(8,100,920)

  Less - Treasury stock, at cost, 665,345 shares in 2010 and 664,523 shares in 2009

(10,059,398)

(10,053,364)

Total Shareholders' Equity

9,747,513

9,294,384

Total Liabilities and Shareholders' Equity

$11,766,321

$10,602,426

Psychemedics Corporation

Balance Sheets

Unaudited

Three Months Ended

Twelve Months Ended

December 31,

December 31,

2010

2009

2010

2009

Revenues

$5,116,237

$4,271,340

$20,108,862

$16,954,994

Cost of revenues

2,034,136

1,749,276

8,067,229

7,345,016

Gross profit

3,082,101

2,522,064

12,041,633

9,609,978

General & administrative

1,435,803

812,395

4,195,998

3,596,774

Marketing & selling

851,547

635,939

2,949,739

2,961,477

Research & development

116,988

113,470

481,433

467,435

Total operating expenses

2,404,338

1,561,804

7,627,170

7,025,686

Operating income

677,763

960,260

4,414,463

2,584,292

Interest income

3,669

11,154

23,091

45,320

Net income before provision for income taxes

681,432

971,414

4,437,554

2,629,612

Provision for income taxes

264,443

425,331

1,823,834

1,102,317

Net income

$416,989

$546,083

$2,613,720

$1,527,295

Basic net income per share

$0.08

$0.11

$0.50

$0.29

Diluted net income per share

$0.08

$0.10

$0.50

$0.29

Dividends declared per share

$0.12

$0.12

$0.48

$0.53

Weighted average common shares outstanding, basic

5,212,479

5,197,232

5,207,244

5,193,329

Weighted average common shares outstanding, diluted

5,235,800

5,204,611

5,226,454

5,204,767

Contact:

Neil Lerner

Vice President and Controller

(978) 206-8220

Neill@psychemedics.com

SOURCE Psychemedics Corporation



RELATED LINKS

http://www.psychemedics.com