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The Female Health Company Expects To Report Modest Profit In FY2011 Third Quarter Despite Continued Delays In Receipt And Shipping Of Large Orders - Board Of Directors Declares Third Quarter Cash Dividend Of $0.05 Per Common Share

CHICAGO, July 15, 2011 /PRNewswire/ -- The Female Health Company (NASDAQ-CM: FHCO), today provided information regarding its financial expectations for the third quarter of FY2011.  The Company announced that, while it should report a modest profit and higher unit shipments for the third quarter of FY2011 than in the prior-year quarter, unit shipments, revenues and net income will be adversely affected by bureaucratic delays and other timing issues involving the receipt and shipment of anticipated substantial orders from Brazil and the Republic of South Africa.  As a result, while the Company expects positive operating earnings for FY2011, results will be significantly less than earlier guidance. Since the May 6, 2011 announcement that the Company's Brazilian distributor, Semina Industria e Comercio (Semina), was awarded a tender for up to 20 million female condoms, unexpected bureaucratic issues have delayed the placement of orders under the terms of the tender.  The Company is awaiting the resolution of certain administrative issues in the Republic of South Africa that have delayed a tender award for the purchase of up to 11 million female condoms.

The Company has routinely noted in its SEC filings and earnings releases that there is the possibility of significant quarter-to-quarter sales variations due to the timing and shipment of large orders.   The Company will report its operating results for the three and nine months ended June 30, 2011 on August 5, 2011.  The Company will hold a conference call at 10 AM CDT on that date to comment upon the financial results.

"Over the past years, the face of AIDS has become feminized.  Globally, HIV/AIDS is the leading cause of death for women of reproductive age (15-44).  Women now comprise more than 50% of adult HIV/AIDS cases. These facts have raised awareness of the need for prevention, as evidenced by the fact that FC2 is now available in 120 countries around the world.  Although our financial results have been constrained by continued bureaucratic delays related to the timing and shipment of certain large orders, we are confident that the fundamentals of our business remain strong and that demand for, and acceptance of, the FC2 Female Condom, continues to increase," stated O.B. Parrish, Chairman and Chief Executive Officer of The Female Health Company.  

"We are very encouraged by recent indications of demand growth from customers that distribute female condoms globally and believe the long-term outlook for the Company remains positive for three reasons:  the feminization of HIV/AIDS, the complexity of developing easy-to-use alternative prevention methods, and the emergence of drug resistant strains of sexually transmitted infections (STIs)."  

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