Medical Action Industries Inc. (the “Company” or “Medical Action”) (NASDAQ/MDCI), a leading supplier of medical and surgical disposable products, today reported results for the fourth quarter and fiscal year ended March 31, 2012.
Net sales for the fourth quarter of fiscal 2012 were $108.2 million, an increase of $3.0 million or 3%, compared to $105.3 million in net sales reported for the comparable prior year period. The Company incurred a net loss for the fourth quarter of fiscal 2012 of $2.5 million or $0.15 per basic and diluted share, compared to net income of $1.1 million or $0.07 per basic and diluted share, reported for the comparable prior year period. When compared to the comparable prior year period, the results for the fourth quarter of fiscal 2012 were negatively impacted by $1.2 million in higher resin costs, $0.8 million relating to a one-time tax valuation allowance against certain state net operating loss carry forwards and $0.4 million in higher costs of products procured from China-based vendors.
Net sales for fiscal 2012 were $437.3 million, an increase of $74.8 million or 21% from the $362.5 million in net sales reported for fiscal 2011. In fiscal 2011 (August 2010), the Company acquired AVID Medical, Inc. (“AVID”); therefore fiscal 2011 reported results included approximately seven months of AVID results. Excluding AVID, Medical Action’s net sales for fiscal 2012 were $298.9 million, representing a comparable increase of $17.8 million or 6% from fiscal 2011. During fiscal 2012, AVID generated net sales of $138.5 million, an increase of approximately 1% over the twelve months ended March 31, 2011 of $137.2 million, of which $81.5 million were included in Medical Action’s fiscal 2011 results.
The increase in net sales, excluding AVID, was comprised of $17.0 million in higher volumes and $0.8 million in higher average selling prices. The increase in volumes was predominantly attributable to higher domestic market penetration in our Patient Care market of $10.5 million and our Clinical Care market of $6.5 million. The increase in average selling prices resulted principally from net price increases of $1.4 million on certain products associated with our Clinical Care market. These were partially offset by a $0.6 decrease in the aggregate average selling price of our Patient Care market. These pricing fluctuations are significantly influenced by competitive pressures, the renewal of certain Group Purchasing Organization supply agreements and a change in the mix of products purchased by our customers.