EX-99.1 2 v175186_ex99-1.htm Unassociated Document

Psychemedics Corporation Announces 2009 Year End Profits

Declares Quarterly Dividend

ACTON, Mass., Feb. 23 /PRNewswire-FirstCall/ -- Psychemedics Corporation (Nasdaq: PMD) today announced fourth quarter and year-end financial results for the period ended December 31, 2009.  The Company also announced a quarterly dividend of $0.12 per share payable to shareholders of record as of March 5, 2010 to be paid on March 19, 2010.  This will be the Company's 54th consecutive quarterly dividend.

The Company's revenue for the year ended December 31, 2009 was $16,954,994, a decrease of 26% as compared to $22,948,604 for 2008.  Net income for the year ended December 31, 2009 was $1,527,295 or $0.29 per share, a decrease of 49% from 2008 during which the Company earned $2,968,789 or $0.57 per share.  Revenue for the fourth quarter was $4,271,340, a decrease of 11% as compared to $4,824,016 in the fourth quarter of 2008.  Net income was $546,083 or $0.10 per share, up 216% from $172,728 or $0.03 per share for the same period of 2008.

Raymond C. Kubacki, Chairman and Chief Executive Officer, said, "Stating the obvious: this was a very tough year for everyone.  And so for us as well.  On the bright side, we continued to add new clients as more and more companies see our patented hair testing method as a significant cost savings tool.  However, the facts are that in 2009 most companies were laying off and not hiring.  Therefore, new business was unable to match the significant fall off in hiring across our entire client base."

Kubacki continued: "Nonetheless, again on the bright side, we remained profitable for the year 2009 – and not just marginally profitable – and we continued our unbroken string of profitability since 1993.  We were able to achieve this level of profitability because we took significant cost reduction/control actions early, and did them logically and methodically.  These included reductions in force, changes in certain benefits such as elimination of bonuses, stock grants, and 401K match for 2009.  We also implemented a reduction in base salaries for all personnel in 2009.  We were determined to remain profitable."

Kubacki concluded, "Once again, we demonstrated that Psychemedics is able to successfully weather any downturn.  The Company's balance sheet remains strong with approximately $5.8 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-fourth 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.drugtestwithhair.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

   
Three Months Ended
December 31,
   
Twelve Months Ended
December 31,
 
                       
   
2009
   
2008
   
2009
   
2008
 
                         
                         
Revenues
  $ 4,271,340     $ 4,824,016     $ 16,954,994     $ 22,948,604  
Cost of revenues
    1,749,276       2,224,289       7,345,016       9,598,515  
                                 
Gross profit
    2,522,064       2,599,727       9,609,978       13,350,089  
                                 
                                 
General & administrative
    812,395       1,257,268       3,596,774       4,520,074  
Marketing & selling
    635,939       933,699       2,961,477       3,648,584  
Research & development
    113,470       112,092       467,435       474,622  
                                 
Total operating expenses
    1,561,804       2,303,059       7,025,686       8,643,280  
Operating income
    960,260       296,668       2,584,292       4,706,809  
Interest income
    11,154       58,073       45,320       308,034  
                                 
Net income before provision
                               
 for income taxes
    971,414       354,741       2,629,612       5,014,843  
                                 
Provision for income taxes
    425,331       182,013       1,102,317       2,046,054  
                                 
Net income
  $ 546,083     $ 172,728     $ 1,527,295     $ 2,968,789  
Basic net income per share
  $ 0.11     $ 0.03     $ 0.29     $ 0.57  
                                 
Diluted net income per share
  $ 0.10     $ 0.03     $ 0.29     $ 0.57  
                                 
Dividends declared per share
  $ 0.12     $ 0.17     $ 0.53     $ 0.66  
                                 
                                 
Special dividends declared
                               
 per share
  $ 0.00     $ 0.50     $ 0.00     $ 0.50  
                                 
Weighted average common
                               
 shares outstanding, basic
    5,197,232       5,206,158       5,193,329       5,219,141  
                                 
Weighted average common
                               
 shares outstanding, diluted
    5,204,611       5,215,743       5,204,767       5,245,713  

 


Psychemedics Corporation
Consolidated Balance Sheets

   
December 31,
   
December 31,
 
   
2009
   
2008
 
             
                    ASSETS
           
 Current Assets:
           
   Cash and cash equivalents
  $ 4,840,367     $ 6,630,119  
   Short-term investments
    1,006,436       --  
   Accounts receivable, net of allowance for
               
    doubtful accounts of $134,282 in 2009 and
               
    $246,462 in 2008
    3,016,084       3,398,455  
   Prepaid expenses and other current assets
    663,433       1,105,886  
   Deferred tax assets
    253,221       449,398  
                 
Total Current Assets
    9,779,541       11,583,858  
                 
Fixed Assets:
               
   Equipment & leasehold improvements
    10,912,906       10,877,479  
   Less accumulated depreciation
    (10,381,599 )     (10,047,755 )
                 
Net Fixed Assets
    531,307       829,724  
                 
   Deferred tax assets, long term
    204,764       139,021  
   Other assets
    86,814       75,183  
                 
Total Assets
  $ 10,602,426     $ 12,627,786  
                 
     LIABILITIES AND SHAREHOLDERS' EQUITY
               
Liabilities:
               
Current Liabilities:
               
   Accounts payable
  $ 180,784     $ 644,894  
   Accrued expenses
    1,090,898       1,268,924  
   Deferred revenue
    36,360       154,080  
                 
Total Current Liabilities
    1,308,042       2,067,898  
                 
Commitments and Contingencies
               
                 
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 5,861,872 shares issued in
               
    2009 and 5,843,068 shares issued in 2008
    29,309       29,216  
   Paid-in capital
    27,419,359       27,118,743  
   Accumulated deficit
    (8,100,920 )     (6,614,114 )
   Less - Treasury stock, at cost, 664,523
               
    shares in 2009 and 647,304 shares in 2008
    (10,053,364 )     (9,973,957 )
                 
Total Shareholders' Equity
    9,294,384       10,559,888  
Total Liabilities and Shareholders' Equity
  $ 10,602,426     $ 12,627,786  


 
Raymond Ruddy
Vice President and Controller
(978) 206-8220
raymondr@psychemedics.com




CONTACT:  Raymond Ruddy, Vice President and Controller, Psychemedics Corporation, +1-978-206-8220, raymondr@psychemedics.com