Revenues drop for RTI

Published: Thursday, April 25, 2013 at 3:43 p.m.
Last Modified: Thursday, April 25, 2013 at 3:43 p.m.

The continued fallout from an FDA warning letter and European media coverage resulted in lower revenues and net income for RTI Biologics in the first quarter, according to the earnings report released Thursday.

Alachua-based RTI reported revenues of $40.4 million in the quarter, an 8 percent drop from first quarter 2012.

The decrease was particularly pronounced in international markets, the result of what CEO Brian Hutchison has called inaccurate reporting about the company and the tissue industry by a "zealot reporter" in Germany who contacted government officials in many European markets.

International revenues were down 27 percent to $4.3 million in the three-month period.

Net income was $1.5 million, or $0.03 per fully diluted share, compared to $2.0 million and $0.04 in first quarter 2012.

RTI is based in Alachua and trades on the Nasdaq stock exchange under the symbol RTIX. The company makes surgical implants from human donated tissue and animal tissue.

The stock opened trading Thursday at $3.82 following the earnings release after closing at $3.64 Wednesday.

The quarterly results were in line with expectations, Hutchison said in a news release.

He credited the company's distribution team for working hard to respond to customer reaction to a warning letter from the Food and Drug Administration.

The FDA issued the warning letter in October following inspections that revealed "significant weakness" in RTI's system to measure levels of bacteria that can come in on materials in its tissue processing facility.

There were no patient safety issues and the company has corrected procedures, according to Hutchison.

He said RTI anticipates a strong second half of the year following the closure of the warning letter and the introduction of new implants.

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