Chembio Diagnostics reported financial results for the three and twelve months ended December 31, 2007.
Total revenues for 2007 were $9.2 million, an increase of $2.7 million or 42% from total revenues of $6.5 million in 2006. This increase was primarily due to initial sales of Chembio’s rapid HIV tests to its U.S. marketing partner, increased sales in Africa, sales to a distributor in Mexico, and increased development and grant revenues, partially offset by lower sales to South America.
Rapid HIV test revenue for 2007 increased $3.5 million to $7.9 million or 79% from $4.4 million in 2006. This includes approximately $2.4 million in revenues realized from sales of rapid HIV tests in the United States.
Total revenues for the fourth quarter of 2007 were $2.4 million, a 9% decrease compared with fourth quarter 2006 revenues of $2.6 million. This decrease was primarily due to $1.1 million of revenues from a division of Bio-Rad Laboratories in Mexico and $845,000 in sales to Brazil during the 2006 fourth quarter that did not recur in the 2007 fourth quarter. These items were largely offset by increased rapid HIV test sales in Africa of $740,000, and to sales by the Company’s marketing partner in the U.S. of $875,000 during the 2007 quarter, where there were no sales in the 2006 quarter.
“We are pleased with our many achievements in 2007. We significantly increased our revenues, expanded our gross margins, controlled our overhead costs, advanced our proprietary [Dual Path Platform] technology and enhanced our production capacity. We expect to build upon this momentum throughout 2008,” said Lawrence Siebert, President and CEO. “Our 2007 revenue growth is largely attributable to our entry into the U.S. market. The recent CLIA waiver mentioned above significantly expands the market for this point-of-care diagnostic. In addition, recent recommendations by the [CDC] for routine HIV screening of the general population are expected to continue to drive sales of rapid, point-of-care HIV diagnostics.”
“During 2007, we made great strides toward advancing our proprietary [Dual Path Platform] technology. We engaged in a number of feasibility agreements for DPP, and are optimistic about its future. Our agreements with the Oswaldo Cruz Foundation and agreements in negotiations with others are validating DPP and laying the ground work for future DPP collaborations,” continued Mr. Siebert.