SAN DIEGO, Sept. 10 -- Mera Pharmaceuticals, Inc. (OTC Bulletin Board: MRPI) has released its financial results for its third fiscal quarter, ended July 31, 2003. The results show a continued narrowing of operating losses, both year to year and sequentially. The loss from operations for third quarter 2003 fell to $178,000 versus a loss of $499,000 for the same quarter in 2002, a 64% improvement. Relative to the second quarter of 2003, when the Company had a loss from operations of $406,000, the improvement was a still very strong 56%.
Daniel Beharry, who took over as Mera's CEO in July, noted that the improvement was due to both increasing revenues and decreased expenses. "Our revenues improved in all three categories -- product sales, contract services and royalties. Revenues of $656,000 year-to-date nearly match the $662,000 total for all of 2002. In addition, the third quarter was the first full quarter during which our cost-cutting program was in effect. As a result, our general and administrative expense fell from $312,000 for second quarter of 2003 to just $173,000 for the third quarter, a reduction of 44%. A comparison to the G&A expenses of $544,000 for the first quarter of 2003 is even more impressive, reflecting a reduction of nearly 68%. The benefits from that cost control effort are apparent and ongoing."
Mr. Beharry continued, "We completed the Chapter 11 reorganization of Mera less than a year ago, and while the Company still faces some challenges, the continued progress shown by these results is encouraging. We believe there is a lot of room for improvement still on our production efficiency, which will help to increase margins. However, the key to success is a continued increase in revenues. To accomplish that we have increased our sales and marketing efforts to support sales of our AstaFactor(R) product, including the launch of a television, radio and print advertising campaign in Hawaii during the third quarter and the increase in our advertising for the Southern California market. We also have three new products in the planning stage, all of which should be in test production by the first calendar quarter of 2004, if not sooner.
"Another focus is extending our distribution to international markets. We are engaged in discussions now with several parties seeking distribution rights for AstaFactor(R) in markets where margins and receptivity both tend to be higher. That work is in addition to efforts to expand distribution domestically through private label opportunities.
"Each of these initiatives is designed to strengthen our product and revenue base. There will be some upfront costs associated with them, but our expectation is that by bearing those costs now we will prepare the company to make progress toward profitability in the future."
Mera Pharmaceuticals, Inc., based in Kona, Hawaii, and Solana Beach, California, is focused on identifying and producing valuable products from natural sources. Mera's patented technology and proprietary processes give it a significant advantage in exploiting the rich, untapped resource of microbial aquatic plants, long recognized for their potential medical and nutritional value. Mera's first nutraceutical product, the AstaFactor(R), is a concentrated source of natural astaxanthin, found in a number of fish and seafood species. Astaxanthin is proven to be an extremely powerful antioxidant and an effective anti-inflammatory.
This press release contains forward-looking statements characterized by the use of words such as "believe," "expect," "anticipate," "feel" and similar expressions. Actual results might differ materially from those projected in, expressed in or implied by the forward-looking statements. The kinds of risks and uncertainties that could affect the future operating results of Aquasearch include, without limitation: (i) the ability to attract new business for its existing products; (ii) the ability to identify new products and bring them to market; (iii) the ability to identify promising pharmaceutical candidates and, if they are identified, the ability to have them successfully complete the clinical trial process; (iv) the sensitivity of Mera to general economic conditions; (v) the inability to attract the additional investment needed to plans regarding the drug discovery and development business. Additional information concerning risk factors that could cause actual results to differ materially from those described in forward looking statements can be found in Mera's SEC filings, including its Annual Report on Form 10-KSB and other periodic reports that it files under the Securities Exchange Act of 1934, as amended.