Forbes Medi-Tech reports 2Q profits

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Related tags: Income statement, Generally accepted accounting principles, Revenue

Canadian company Forbes Medi -Tech yesterday reported profitable
second quarter and first half results, making significant
improvements on losses reported last year. The good news was a
result of the one-time C$6.1 million gain from the purchase of
Reducol rights in June.

Canadian biopharmaceutical company Forbes Medi -Tech yesterday reported profitable second quarter and first half results, a significant improvement on losses reported in the same periods last year.

Net income for the three months ended 30 June 2002 was C$3 million (€1.96m) compared to a net loss of C$3.6 million for the same period ended 31 July 2001. Net income for this year's first half was C$0.9 million compared with a net loss of C$6.6 million for the comparable 2001 period.(In 2001 Forbes changed its year-end from 31 July to 31 December, so the comparative period for this quarter and half year is the three and six months ended 31 July 2001. )

The jump from net loss to net profit in both the three and six month periods, resulted primarily from a one-time C$6.1 million gain from the purchase of rights in June for the cholesterol-lowering ingredient Reducol, said the company, for an amount significantly below the deferred revenue liability on the company's financial statements.

Forbes said it had record phytosterol revenues of C$2.6 million for the three months ended 30 June 2002 and C$5.0 million for the six months period to end of June, thanks to sales of non-food grade sterols from its share of the Phyto-Source joint venture. The amounts include record direct product sales and royalties of C$2.1 million and C$4.0 million, respectively.

Reductions in general and administrative (G&A) expenses and research and development (R&D) expenses also contributed to the improvement.

Based on existing contracts alone, at 29 August 2002, the company isanticipating that its share of phytosterol sales for calendar 2002 will bea minimum of approximately C$7 million, compared with approximately C$5 million for calendar 2001.

A conference call and webcast to discuss these financial results will beheld on 4 September 2002 at 1 p.m. PST. (4:00 p.m. EST). The live webcast can beaccessed through the company's website www.forbesmedi.com​.

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