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UnitedGuardian Inc Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: August 9, 2012 09:33AM
UnitedGuardian Inc (UG) filed Quarterly Report for the period ended 2012-06-30.
Highlight of Business Operations:Pharmaceuticals: The Company s RENACIDIN product typically accounts for 85% of the Company s pharmaceutical product sales. Over the past 20 months, RENACIDIN experienced two disruptions in production that led to product shortages. The first disruption began in November 2010 and lasted until May 2011, and was caused by regulatory issues at the third-party facility that manufactures the product for the Company. The issues were unrelated to the Company s product, but disrupted all production at that facility. When product became available in May 2011, there was a surge in orders, not only due to the need of the Company s distributors to restock their depleted inventories, but also because of the desire on the part of the distributors to avoid a price increase that was to go into effect on June 1, 2011. The result was unusually strong RENACIDIN sales in the second quarter of 2011.
Personal care products: For the second quarter of 2012 the Company s sales of personal care products decreased by $65,231 (2.6%) when compared with the second quarter of 2011, and for the first half of 2012 the Company s sales of personal care products increased by $60,421 (1.2%) when compared with the comparable period in 2011. The decrease in sales in the second quarter of 2012, and the increase in sales for the first six months of 2012, were due to normal fluctuations in sales to ASI, the Company's largest marketing partner. Sales to ASI decreased by $64,878 (3.2%) and increased $76,464 (1.9%) for the three and six months periods, respectively, ended June 30, 2012, compared with the corresponding periods in 2011. The Company believes that these fluctuations in sales were attributable to the timing of orders placed by ASI.
In addition to the above changes in sales, net sales allowances increased $2,491 and $27,154 for the three and six months, respectively, ended June 30, 2012, when compared with the corresponding periods in 2011. The increases were primarily due to increases in fees paid to the Veterans' Administration.
Stocks Discussed: UG,