HOUSTON, Aug. 21, 2019 (GLOBE NEWSWIRE) -- Sharps Compliance Corp. (NASDAQ: SMED), a leading full-service national provider of comprehensive waste management solutions including medical, pharmaceutical and hazardous, today reported financial results for the fourth quarter and fiscal year 2019 ended June 30, 2019.

Revenue in the fourth quarter of fiscal 2019 was $12.2 million an increase of 23% compared to $9.9 million in the same prior year quarter and a 29% increase sequentially as compared to revenue for the 2019 third quarter. Customer billings were $12.7 million for the fourth quarter compared to $9.7 million for the prior year, an increase of 31%. Gross margin improved to 32% compared to 30% in the fourth quarter of fiscal 2018 and 22% in the third quarter of fiscal 2019. The Company reported operating income of $0.6 million in the fourth quarter of 2019, compared to an operating loss of $0.1 million in the fourth quarter of 2018. Sharps recorded net income of $0.5 million, or $0.03 per basic and diluted share in the fourth quarter of fiscal 2019, as compared to a net loss of $0.1 million or a loss of $0.01 per basic and diluted share in the fourth quarter of fiscal 2018.

David P. Tusa, President and Chief Executive Officer of Sharps, stated, “We closed out fiscal 2019 with a strong fourth quarter, as evidenced by solid revenue growth, both year over year and on a sequential basis, improved gross margins and improved profitability. During the quarter we delivered substantial growth across our three leading solution offerings: route-based, mailback and unused medications; and drove record billings growth across all of our market segments. We believe the fourth quarter reflects the success of our strategy to transform the business from a provider of medical waste management mailbacks only, to a comprehensive solutions provider serving a broad range of customers in the Healthcare and Retail markets.

“As we kick-off fiscal 2020, we believe our diverse capabilities position us well to continue to grow our market share in the small to medium waste generator segment which encompasses the key customers for our portfolio of solutions. We are unique in our strategy to structure our service offering to include route-based pick-up, mailback, or a combination of both, to meet the needs of our customers in an effective and cost-efficient service model.

“As the leader in the patient dispensed unused medication management business, we continue to see strong demand for our unused medications solutions, including the MedSafe and TakeAway Medication Recovery System Envelopes. This part of our business increased 41% over the fourth quarter last year, 32% over the sequential quarter and accounts for 18% of our overall billings in the fourth quarter of 2019. As of June 30, 2019, we have grown this business organically to an installed base of 3,600 collection receptacles in retail as well as hospital pharmacies and long-term care, drug treatment and law enforcement facilities and customers have returned over 33,000 inner liners. As of today, the installed base of collection receptacles is 3,800 and returned inner liners are 35,500. We see continued strong growth for unused medication management for fiscal 2020. We are proud of our leadership position and see the Company playing a role in solving the epidemic in the United States of prescription drug abuse and accidental poisoning in our country.”

Fourth Quarter Review

Professional market billings increased 13% to $3.9 million in the fourth quarter of fiscal 2019 compared to $3.5 million in the prior year period. The growth was wholly organic, related to the Company’s ability to provide a combination of the cost-effective and easy to use Sharps Recovery System™ and the Company’s route-based pick-up services to serve customers from the small to medium quantity generator sector made up of physicians, clinics, dentists, surgery centers, veterinarians and other healthcare professionals. Billings for the inside and online sales channel, which primarily targets the Professional and Government markets, increased 13% to $2.2 million in the fourth quarter of fiscal 2019 as compared to $2.0 million in the same prior year period.

Fourth quarter Retail market billings grew 54% from $2.3 million to $3.5 million as compared to the prior year period. Contributing to the growth were increased billings for flu shot related orders of $0.8 million and unused medication solutions of $0.4 million.

Home Healthcare billings increased 4% to $2.1 million in the fourth quarter of 2019 compared to $2.0 million in the fourth quarter of 2018.

Pharmaceutical Manufacturer billings increased 187% to $1.5 million in the fourth quarter of fiscal 2019 compared to $0.5 million in the fourth quarter of fiscal 2018, related to inventory builds for four current and four new patient support programs.

Government billings increased 29% to $0.8 million in the fourth quarter of fiscal 2019. Government market billings included $0.2 million of orders under the VA’s Blanket Purchase Agreement. MedSafe related orders to the government market were $0.2 million for the fourth quarter of fiscal 2019.

Additional Operating Results

The Company reported gross margin of 32% for the fourth quarter of fiscal 2019, an increase compared to gross margin of 30% in the same prior year quarter. SG&A increased approximately 10.5% to $3.1 million but decreased as a percentage of revenue to 26% for the fourth quarter of fiscal 2019 as compared to SG&A of $2.8 million, or 28% of revenue, in the same prior year quarter. The increase in SG&A is related to the Company’s continued investments in sales and marketing.

Sharps recorded EBITDA of $1.0 million in the fourth quarter of fiscal 2019, as compared to EBITDA of $0.3 million in the fourth quarter of fiscal 2018. (See Reconciliation of Net Income (Loss) to EBITDA in the supplemental table included at the end of this release).

Full Year 2019 Results

Sharps recorded revenue of $44.3 million in fiscal year 2019, an increase of 10% compared to revenue of $40.1 million in fiscal year 2018. Customer billings increased 13% to $45.0 million in fiscal year 2019. Professional billings increased 15% to $15.1 million in fiscal 2019 as compared to $13.1 million in the prior year period. In fiscal 2019, Retail billings increased 46% to $11.5 million as compared to $7.9 million in fiscal 2018. The increase in retail billings for the fiscal 2019 is primarily due to a $2.8 million increase in flu shot related orders and a $0.8 million increase in MedSafe billings. Pharmaceutical Manufacturer billings decreased 8% to $4.1 million in fiscal 2019 as compared to $4.5 million in the prior year. Although there were new pharmaceutical manufacturer programs launched in fiscal 2019, there were significant inventory builds for larger programs during fiscal 2018 which did not re-occur in fiscal 2019 due to their significant size. Home Health Care billings decreased 2% to $7.8 million in fiscal 2019 compared to $8.0 million in 2018. Assisted Living billings in fiscal 2019 of $2.5 remained consistent with 2018. Government billings increased 19% to $2.5 million in fiscal 2019 as compared to $2.1 million in the prior year.

Gross margin increased to 30% for fiscal 2019 as compared to 28.0% in fiscal 2018. SG&A expense increased 8% to $12.0 million compared to $11.2 million in 2018, related to the Company’s continued investments in sales and marketing, but decreased slightly as a percentage of sales at 27% for fiscal 2019 compared to 28% of sales in fiscal 2018. The Company recorded operating income of $0.4 million in fiscal 2019 as compared to an operating loss of $0.6 million in fiscal 2018.

The Company achieved net income of $0.2 million or $0.01 per basic and diluted share in fiscal 2019 compared to a net loss of $0.7 million or a loss of $0.04 for 2018.

Sharps more than doubled EBITDA in fiscal 2019 to $2.1 million as compared to EBITDA of $1.0 million in fiscal 2018. (See Reconciliation of Net Income (Loss) to EBITDA in the supplemental table included at the end of this release).

Financial Flexibility and a Strong Balance Sheet

Cash was $4.5 million at June 30, 2019, down from the cash level of $5.2 million at June 30, 2018. The Company had working capital of $10.6 million at June 30, 2019 an increase over working capital at June 30, 2018 of $10.3 million.

Looking Forward

Mr. Tusa concluded, “Looking forward to fiscal 2020, we see the September 2019 quarter shaping up as strong and believe the full fiscal year 2020 should benefit from growth in all solution offerings and markets. Our growth is being driven not only by the Company’s successful transformation to a comprehensive solutions provider but also our focus on customer service, reasonable contract terms and fair pricing in markets, which we believe are vastly underserved."

About Sharps Compliance Corp.

Headquartered in Houston, Texas, Sharps Compliance is a leading full-service national provider of comprehensive waste management services including medical, pharmaceutical and hazardous. Its key markets include healthcare facilities, pharmaceutical manufacturers, home healthcare providers, assisted living / long-term care, surgery centers, retail pharmacies and clinics, and the professional market which is comprised of physicians, dentists and veterinary practices. The Company's flagship product, the Sharps Recovery System, is a comprehensive solution for the containment, transportation, treatment and tracking of medical waste and other used healthcare materials. The Company also offers its route-based pick-up service in a twenty-four (24) state region of the South, Southeast and Northeast portions of the United States. Sharps also provides two simple solutions for safe and easy disposal of unused medications: MedSafe collection receptacles and TakeAway Medication Recovery System Envelopes.

More information on the Company and its products can be found on its website at: www.sharpsinc.com.