Zila Releases 1Q05 Results

Zila Releases 1Q05 Results

PHOENIXZila Inc. (AMSE:ZILA) announced itsfinancial results for the first quarter of fiscal 2005 ended Oct. 31, 2004(1Q05).

Net sales for 1Q05 decreased to $11.8 million from $12.1million for the first quarter of fiscal 2004 (1Q04).The company experienced anet loss of $2.7 million ($0.06 per diluted common share) for 1Q05, compared toa net loss of $1.6 million ($0.04 per diluted common share) for 1Q04.

Gross profit for 1Q05 was $7.7 million, a 9 percent increasefrom $7.1 million in 1Q04. Gross margin for 1Q05 increased to 65 percent from 59 percentin 1Q04, driven primarily by lower ascorbic acid costs.

Doug Burkett, Ph.D., Zilas chairman, president and chiefexecutive officer said, We are resolute in our determination to drive futuregrowth and aggressively support Zila Nutraceuticals, our growth business oftoday, and Zila Biotechnology, our growth business of tomorrow, with theresources required to maximize long-term return. Those costs have acceleratedsharply over the last year, as we are launching new products at Nutraceuticalsand advancing our OraTest regulatory effort. While that means that our bottomline is likely to remain under pressure for the near term, its consistentwith our strategy to generate future growth and become profitable followingcompletion of the OraTest regulatory effort and eventual product launch.