YOUNGSVILLE, La., June 14, 2017 (GLOBE NEWSWIRE) -- RedHawk Holdings Corp. (OTCQB:IDNG) (“RedHawk” or the “Company”) announced today consolidated net income of $151,641 ($nil per share) on net revenues of $427,276 for the three month period ended March 31, 2017. On minimal revenues, RedHawk previously reported a net loss of $653,811 ($nil per share) for the comparable three month period ended March 31, 2016.
The Company said the significant improvement in its profitability resulted from lower operating expenses and improved margins on sales of its pharmaceutical branded generics and “specials” through its United Kingdom-based investment in EcoGen Europe, Ltd (“EcoGen”).
For the nine month period ended March 31, 2017, RedHawk said EcoGen, its branded generic pharmaceutical business unit, generated operating income of approximately $270,000 on net revenues of approximately $775,500.
The Company also reported that it has reached an agreement with its United Kingdom (“UK”) partners to resolve certain previously announced business questions that had recently come to its attention during due diligence. With this resolution, the Company said it has resumed negotiations with its UK partners about the possible increase in its ownership position in EcoGen. RedHawk said it hopes negotiations on the new ownership structure will be completed within the next thirty days.
In March 2016, RedHawk, through its wholly-owned subsidiary RedHawk Pharma UK LTD, completed the acquisition of a 25% ownership investment in EcoGen, a United Kingdom company specializing in the manufacturing and the marketing of certain branded generic pharmaceuticals and medical devices. Scarlett Pharma Ltd, a United Kingdom company, initially retained a 75% ownership position in EcoGen. EcoGen also holds distribution rights in a number of European countries for Zonis®, a patented antimicrobial ionic silver calcium catheter dressing with both wound healing and haemostatic properties. It is designed to be placed directly over the exit site of all vascular and non-vascular percutaneous medical devices. Zonis® reduces bacteria colonization and related bloodstream infections by delivering ionic silver directly to the site.
At March 31, 2017, the UK’s National Health Service discontinued the permitted sale of NP8’s and special obtains pharmaceuticals. To address this change, RedHawk has re-aligned its pharmaceutical operations to reduce overhead and has lowered its offered customer discounts to increase profit margins. Further, RedHawk said it has expanded the marketing of its branded generics to Clinical Commissioning Groups in the UK. The Company also said it is in negotiations to expand the number of generic drugs currently being offered by EcoGen. The Company believes the successful implementation of this plan will help offset any short-term lost revenues resulting from the discontinuation of NP8’s and special obtains.
The Company also said RedHawk Medical Products & Services, LLC has commenced production and sales of its SANDD mini (Sharps and Needle Destruction Device) with an initial sales order negotiated during the June 30, 2017 quarter.
In December 2015, the Company acquired all of the tangible and intangible property rights for the SANDD mini (formerly known as the Disintegrator™ Insulin Needle Destruction Unit), the only needle destruction device approved by the United States Food and Drug Administration (“FDA”). The acquired assets included all matters subject to the SANDD mini original patent applications, including technical designs, drawings, trademarks, tradenames, FDA documents, clinical test data, and all manufacturing tooling and fixtures.
The SANDD mini is a portable, battery operated, insulin-needle destruction device for use at home primarily by diabetics. The device is intended for the destruction and environmentally friendly disposal of 27-30 gauge insulin hypodermic needles that are 5/16 to ½ inch in length. It can be used with most insulin pens with disposable insulin syringes from 1/3 to 1 cubic centimeter in volume. The SANDD mini is used by diabetics for the safe and environmentally friendly disposal of needles following their use and is an effective alternative to hazardous waste needle disposal utilizing sharps containers.
The Company further said it is evaluating certain modifications to the original SANDD mini design which, if successful, would significant expand the unit’s market capabilities and will then include the allergy, cosmetology and ophthalmology medical device markets. RedHawk also said it has decided to exit the exploration and production section of the energy sector and instead focus more on possible acquisition of energy service providers where it believes business valuations are more attractive.
About RedHawk Holdings Corp.
RedHawk Holdings Corp., formerly Independence Energy Corp., is a diversified holding company which, through its subsidiaries, is engaged in sales and distribution of medical devices, sales of branded generic pharmaceutical drugs, commercial real estate investment and leasing, sales of point of entry full-body security systems, and specialized financial services. Through its medical products business unit, the Company sells WoundClot Surgical - Advanced Bleeding Control, the Sharps and Needle Destruction Device (SANDD™), the Carotid Artery Digital Non-Contact Thermometer and Zonis®. Through our United Kingdom based subsidiary, we manufacture and market branded generic pharmaceuticals, certain other generic pharmaceuticals known as “specials” and certain pharmaceuticals outside of the United Kingdom’s National Health Service drug tariff referred to as NP8’s. Our real estate leasing revenues are generated from various commercial properties under long-term lease. Additionally, RedHawk’s real estate investment unit holds limited liability company interest in a commercial restoration project in Hawaii. The Company’s financial service revenue is from brokerage services earned in connection with debt placement services. RedHawk Energy holds the exclusive U.S. manufacturing and distribution rights for the Centri Controlled Entry System, a unique, closed cabinet, nominal dose transmission full body x-ray scanner.
Cautionary Statement Regarding Forward Looking Statements
This release may contain forward-looking statements. Forward-looking statements are all statements other than statements of historical fact. Statements contained in this release that are not historical facts may be deemed to be forward-looking statements. The words “anticipate,” “may,” “can,” “plans,” “believes,” “estimates,” “expects,” “projects,” “targets,” “intends,” “likely,” “will,” “should,” “to be,” “potential” and any similar expressions are intended to identify those assertions as forward-looking statements.
Investors are cautioned that forward-looking statements are inherently uncertain. Actual performance and results may differ materially from that projected or suggested herein due to certain risks and uncertainties. In evaluating forward-looking statements, you should consider the various factors which may cause actual results to differ materially from any forward-looking statements including those listed in the “Risk Factors” section of our latest 10-K report. Further, the Company may make changes to its business plans that could or will affect its results. Investors are cautioned that the Company will undertake no obligation to update any forward-looking statements.