Psychemedics (PMD) Reports Q1 EPS of $0.11 on Revenues of $9.8M

Psychemedics (NASDAQ: PMD) reported Q1 EPS of $0.11, versus $0.23 reported last year. Revenue for the quarter came in at $9.8 million, versus $10.9 million reported last year.

Raymond C. Kubacki, Chairman and Chief Executive Officer, stated:

"First quarter revenues and earnings were below expectations, and continued to be impacted by negative changes in the Brazilian foreign currency exchange rate.

“International revenues showed a decline. While the Driver segment showed some weakness, this was compounded by a decline in the more cyclical Non-Driver business and the negative foreign currency exchange. Our domestic business was basically flat with continued growth in Oil & Gas and Transportation, but we experienced some weakness in the other market segments.

“Total operating expenses were held in check and came in flat as compared to the first quarter in 2018. Therefore, the decline in earnings came as a result of the softness in volume and unfavorable foreign exchange rate. This was further pronounced by one less day as compared to the same quarter in 2018.

“Fortunately, one quarter does not make a trend; and we remain optimistic as we move forward.

“In prior quarters press releases, we reported that effective September 2018, under Brazilian law, professional drivers would be required to renew their license every 2 ½ years, instead of the current every 5 years. As of the date of this press release, the Brazilian government has not yet implemented this legally mandated testing. We previously reported that our best estimate for the effective date of actual implementation of the 2 ½ year requirement, which will almost double the market size, will be the fourth quarter of 2019 and this is still our best estimate.

“We continue to demonstrate our scientific leadership. In March 2019, the Company introduced the industry’s first confirmation process to accurately measure hydroxycocaines. While the Company’s patented hair test is already the most accurate and sensitive, the detection of hydroxycocaines, unique cocaine markers, now allows the Company to apply additional metabolic criteria to confirm cocaine use. The new offering once again builds on Psychemedics’ unmatched technology to advance drug detection science and equips client companies with results to lower risks associated with cocaine in the workplace. With this announcement, the company once again advances the science of detection and reinforces its reputation as the leading innovator since it pioneered drug testing with hair in 1986.

For earnings history and earnings-related data on Psychemedics (PMD) click here.

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