PLANTATION, Fla., Nov. 2, 2005 (PRIMEZONE) -- MEDirect Latino Inc. (Pink Sheets:MLTO) (www.medirectlatino.org), the first national provider of direct-to-consumer Medicare reimbursed medical products focused exclusively on chronic diseases afflicting the Hispanic community, today announced the successful negotiation of more favorable terms of existing agreements with major manufacturers of diabetic testing products for the Company's Medicare eligible customers. Additionally, the Company confirmed a lower costs basis for the chairlifts and heating pads, which are offered as product line extensions to MEDirect Latino's customers. Details of the specific terms of the revised agreements are confidential; however, the new agreements will result in an immediate price reduction of 16% for the Company's line of diabetes diagnostic testing supplies. MEDirect Latino expects the decrease in cost of goods will directly result in an increase to gross profit of 5% or over $750,000 of additional gross profits on present projections of $15 million of annualized gross revenues. In support of the Company's national media campaign, MEDirect Latino has secured a combined multi-million dollar line of credit with its suppliers, and increased its credit terms from 30 days to 60 days. The increased payment cycle will immediately result in cash flow efficiencies exceeding 2% or a minimum of $300,000 of additional net income per annum.
Mr. Raymond Talarico, Co-Chairman and CEO of MEDirect Latino stated: "We were very pleased with the reception we received at the Medtrade Conference in Atlanta. MEDirect Latino is quickly becoming recognized as the leading provider in the Medicare reimbursed, medical products to the Hispanic market. We have selected pharmaceutical partners who understand the value of our Latino customer, and MEDirect Latino's ability to reach them. Our escalating monthly increase in sales and new start customers positioned the Company to increase our sales projections, which has resulted in our ability to dictate substantial cost reductions of up to 16% for various product lines from our pharmaceutical providers. These cost reductions will favorably impact our gross margins and net profits. Medicare fixes the prices that providers charge customers, as such; there are only two ways to increase profitability. The first way is to increase gross sales through targeted national advertising, and proven customer support. This must be balanced with the management of direct overhead, without constricting growth or profitability. The second way to increase profitability is to lower the cost of goods, while negotiating favorable payment terms to insure that there is no need to debt finance inventory while collecting receivables. The Company's results in these areas speak for themselves, as we continue to set records each month for gross sale. In addition, we have now achieved a lower cost of goods sold, and payment terms that make debt financing unnecessary. We expect these record results to continue in the immediate future. Our Shareholders will be pleased with our operating results for October, as the impact of Hurricane Wilma on the Company's operations was minimized due to our preparations. The Company will announce October's operating results after the market closes on Wednesday, November 9, 2005."
Mr. William Van Aalten, MEDirect Latino Inc., General Operations Manager stated: "Besides meeting with our current suppliers at Medtrade, the Company was also able to source new suppliers as we seek to extend our product lines. We are introducing several new products in early 2006, which have been requested by our customers in recent satisfaction surveys. These product extensions should continue to allow the Company to drive its gross sales, while increasing our average order per customer, and lowering our overall customer acquisition costs. The Company's product extension goals focus on products which compliment our existing line of branded and co-branded diabetic diagnostic testing supplies in the Medicare reimbursable regime, while offering natural extensions and enhancing the quality of life of our customers."
On Tuesday, October 18, 2005, Company management discussed recent revenue results, the national media campaign and key operating issues on its national conference call with the brokerage community.
Interested parties may hear a replay of the call by telephone.
To hear a recording of the call (available for 30 days):
Call 1-800-642-1687 in the United States or Canada or;
Call 1-706-645-9291 in the Atlanta Area or Internationally
Pin Code: 1436343 followed by the number key
ANALYTICAL REPORTS
Additional Company information may be obtained by reviewing a detailed research report published by noted micro-cap analyst, Mr. William Ritger, President of The Research Works, Inc. covering MEDirect Latino. The report is now available for review at: http://www.stocksontheweb.com/mlto.pdf
Additional Company information may be obtained by reviewing a comprehensive analytical profile generated by small cap analyst, Mr. Gerald Kieft, President of Wall Street Resources, Inc. The 27-page report includes detailed information on the Company's business model, products, industry, valuation, management, and risks. The report is available at: http://www.wallstreetresources.net/pdf/fc/MLTO2.pdf
ABOUT MEDIRECT LATINO:
MEDirect Latino (Pink Sheets:MLTO) (www.medirectlatino.org) is a rapidly growing, uniquely positioned provider of direct-to-consumer Medicare reimbursed medical products focused exclusively on chronic diseases afflicting the Hispanic community in the United States and Puerto Rico. MEDirect is the only company positioned to serve the U.S. Hispanic healthcare market as a direct-to-consumer Medicare provider on an authentically national level. The Company's current focus is the distribution of products for the treatment of Type II diabetes specifically because of its disproportionate impact and increasing diagnosis rate within the US Hispanic population, noting an incidence of 120% higher than among non-Hispanic whites. Type II diabetes was also targeted because of its unique status within the Medicare reimbursement regime and because of its high degree of correlation to other chronic conditions such as high blood pressure and heart disease. These other conditions represent considerable future market potential that will allow MEDirect to efficiently scale its model by leveraging its existing client base and infrastructure.
The current Hispanic market for MEDirect's products is conservatively estimated at approximately $748M in the continental United States. The size of the opportunity is understated by such figures as an estimated 1.2 million of the over 4.1 million Hispanics in the United States over 65 eligible to receive Medicare benefits are currently collecting these benefits with an estimate that over 1.4 million of those Medicare-eligible Hispanics have diabetes (implying a potential continental U.S. market for MEDirect products of approximately $1 billion).
FORWARD-LOOKING STATEMENTS
Statements about the Company's future expectations, including future revenues and earnings, and all other statements in this press release other than historical facts are "forward-looking statements" within the meaning of section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as the term is defined in the Private Litigation Reform Act of 1995. The Company's actual results could differ materially from expected results. The Company undertakes no obligation to update forward-looking statements to reflect subsequently occurring events or circumstances. Should events occur which materially affect any comments made within this press release; the Company will appropriately inform the public.
The MEDirect Latino Inc. logo is available at: http://www.primezone.com/newsroom/prs/?pkgid=1873