DOYLESTOWN, Pa., Nov. 12 /PRNewswire-FirstCall/ -- The Quigley
Corporation, (NASDAQ:QGLY) http://www.quigleyco.com/ today reported
net sales of $5.0 million for the three months ended September 30,
2009, compared to net sales of $6.4 million for the three months
ended September 30, 2008. The Company generated net income for the
three months ended September 30, 2009, of $1.2 million, or $0.09
per share, compared to net income of $879,000, or $0.07 per share,
for the three months ended September 30, 2008. Results for the
third quarter of 2009 compared to the third quarter of 2008
primarily reflect a decrease in net sales of $1.4 million and a
corresponding decrease of $467,000 in gross profit. These decreases
were offset by reductions of $236,000 in sales, marketing and
administration expenses and $614,000 in research and development
costs. The decrease in these costs was principally due to reduced
personnel costs, and a reduction in clinical study related costs
incurred as a result of the completion of the QR-333 Diabetic
Neuropathy Phase IIb study, results of which were previously
reported on July 22, 2009. For the nine months ended September 30,
2009, net sales were $10.7 million, compared to net sales of $13.7
million, for the nine months ended September 30, 2008. The net loss
for the nine months ended September 30, 2009 was $5.6 million, or
($0.43) per share, compared to a net loss of $3.6 million, or
($0.28) per share, for the nine months ended September 30, 2008.
The net loss for the nine months ended September 30, 2009 includes
approximately $2.5 million in costs incurred (primarily legal
expenses) as a consequence of the proxy contest between differing
slates of proposed boards of directors. In addition to the effect
of the costs incurred in the proxy contest, the financial results
for the nine months ended September 30, 2009 as compared to the
nine months ended September 30, 2008 reflect a decrease in net
sales of $3.0 million and a corresponding $2.3 million decrease in
gross profit. These decreases were offset by a reduction of $1.3
million in sales, marketing and administration expenses and $2.6
million in research and development costs. The decrease in these
costs was principally due to the aforementioned reduction in
personnel costs, lower head count and a reduction in clinical study
related costs incurred as a result of the completion of the QR-333
Diabetic Neuropathy Phase IIb study. Additionally, the net loss for
the nine months ended September 30, 2008 included a one-time
aggregate benefit of $875,000 as a result of income from
discontinued operations of $139,000 and a gain on the disposal of
the health and wellness operations of $736,000. The gross profits
for both the three and nine month periods ended September 30, 2009
declined compared to the three and nine month periods ended
September 30, 2008 due to the net effect of an increase in sales
allowances (returns, discounts and cooperative marketing
incentives), an adverse impact to net sales as a consequence of the
inventory reduction programs maintained by the Company's larger
retail customers, and costs associated with the Elizabethtown
manufacturing facility closing. These items were offset by the
elimination of the production and facility overhead expenses
attributable to the Company's Elizabethtown manufacturing facility
that was closed in June 2009. Gross margins are influenced by
fluctuations in quarter-to-quarter production volume, fixed
production costs and related overhead absorption, and the timing of
shipments to customers which are factors of the seasonality of the
Company's sales activities and products. Ted Karkus, Chairman and
CEO said, "During the third quarter of 2009 we worked diligently to
create a strong foundation for the Company's future. We focused on
reducing costs and improving our position in the marketplace. We
implemented staff and other overhead reductions without adversely
impacting our efficiency or performance, and we are more
strategically focused on our sales and marketing initiatives. As a
result of our efforts, we achieved an increase in net income
year-over-year despite a decline in net sales. In addition, we are
actively focused on our key retail relationships. We have been
meeting with our retail customers to make certain we are in sync
with their changing needs and that we retain important shelf space
and product placement. These visits have already significantly
strengthened our working relationships with important retailers."
Mr. Karkus further stated, "We have projects underway to improve
our product packaging, product positioning and the communication of
the Cold-EEZE(R) message to consumers. Our new marketing efforts
are designed to increase sales, generate brand loyalty and collect
critical information about our customers. We are looking for
opportunities for future growth that may include expanding our OTC
new product pipeline, product acquisitions and other line and brand
extensions. The Company continues to focus on data-driven strategic
planning. Our goal is to avoid investing in marketing efforts,
brand development initiatives and new product launches that do not
add to the Company's shareholder value. While we are pleased with
this initial progress, we are still in the early phases of our
restructuring and rebuilding efforts and look forward to delivering
significantly better performance in the months and years to come."
About The Quigley Corporation The Quigley Corporation (NASDAQ:QGLY)
(http://www.quigleyco.com/) is a diversified natural health medical
science company. Its Cold Remedy segment is a leading marketer and
manufacturer of the Cold-EEZE(R) family of lozenges and sugar free
tablets clinically proven to significantly reduce the severity and
duration of the common cold. Cold-EEZE(R) customers include leading
national wholesalers and distributors, as well as independent and
chain food, drug and mass merchandise stores and pharmacies. The
Quigley Corporation has several wholly owned subsidiaries including
Quigley Manufacturing Inc., which consists of an FDA approved
facility to manufacture Cold-EEZE(R) lozenges and fulfill other
contract manufacturing opportunities, and Quigley Pharma, Inc.,
(http://www.quigleypharma.com/), which conducts research in order
to develop and commercialize a pipeline of patented botanical and
naturally derived potential prescription drugs. Forward-Looking
Statements Certain statements in this press release are
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 and involve known and
unknown risk, uncertainties and other factors that may cause the
Company's actual performance or achievements to be materially
different from the results, performance or achievements expressed
or implied by the forward-looking statement. Factors that impact
such forward-looking statements include, among others, changes in
worldwide general economic conditions, changes in interest rates,
government regulations, and worldwide competition. (Tables Follow)
Condensed Consolidated Statements of Operations (unaudited) The
following represents condensed financial statements (in thousands,
except per share data): Three- Three- Nine- Nine- Months Months
Months Months Ended Ended Ended Ended Sept. 30, Sept. 30, Sept. 30,
Sept. 30, 2009 2008 2009 2008 ($) ($) ($) ($) ------ ------ ------
------ Net sales 4,977 6,354 10,712 13,728 Cost of sales 1,362
2,272 4,454 5,178 Gross profit 3,615 4,082 6,258 8,550 Operating
costs and expenses: Sales & marketing expenses 607 652 3,424
3,450 Administrative 1,470 1,661 7,502 6,200 Research &
development 341 955 975 3,630 2,418 3,268 11,901 13,280 Income
(loss) from operations 1,197 814 (5,643) (4,730) Interest and other
income 5 65 20 286 Income (loss) from continuing operations before
income taxes 1,202 879 (5,643) (4,444) Income tax (benefit) - - - -
Income (loss) from continuing operations 1,202 879 (5,643) (4,444)
Discontinued operations Gain on disposal of health and wellness
operations - - - 736 Income from discontinued operations - - - 139
Net income (loss) 1,202 879 (5,623) (3,569) ===== === =======
======= Basic earnings per share Income (loss) from continuing
operations $0.09 $0.07 ($0.43) ($0.35) Income from discontinued
operations - - - 0.07 Net income (loss) ($0.09) $0.07 ($0.43)
($0.28) ======= ===== ======= ======= Diluted earnings per share
Income (loss) from continuing operations $0.09 $0.07 ($0.43)
($0.35) Income from discontinued operations - - - 0.07 Net income
(loss) ($0.09) $0.07 ($0.43) ($0.28) ======= ===== ======= =======
Weighted average common shares outstanding Basic 12,996 12,885
12,940 12,869 Diluted 13,110 13,140 12,940 12,869 Selected
Condensed Consolidated Balance Sheet Data The following represents
condensed financial data (in thousands) at September 30, 2009 and
December 31, 2008: 2009 2008* ($) ($) (unaudited) -----------
----------- Cash & cash equivalents 8,945 11,957 Accounts
receivable, net 2,487 4,524 Inventory 3,180 3,001 Total current
assets 15,444 20,667 Total assets 18,188 24,369 Total current
liabilities 5,911 6,595 Total stockholders' equity 12,277 17,774 *
Derived from December 31, 2008 audited Financial Statements
CONTACT: Ted Karkus Carl Hymans Chairman of the Board, CEO G.S.
Schwartz & Co. (215) 345-0919 ext. 114 (212) 725-4500 ext. 304
DATASOURCE: The Quigley Corporation CONTACT: Ted Karkus, Chairman
of the Board, CEO, The Quigley Corporation, +1-215-345-0919 ext.
114; Carl Hymans, G.S. Schwartz & Co. (212) 725-4500 ext. 304,
Web Site: http://www.quigleyco.com/
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