The Female Health Company (FHCO) Updates Q3FY2011 Financial Outlook

QualityStocks would like to highlight The Female Health Company (NASDAQ: FHCO). The company, based in Chicago, Illinois, manufactures and markets the FC2 Female Condom® (FC2), which is available in the U.S. and approximately 120 other countries around the world.

In the company’s news today,

The Female Health Company issued an updated financial outlook for the third quarter of fiscal year 2011.

The company said it expects to report a modest profit and higher unit shipments for the third quarter of fiscal 2011 compared to the comparable quarter of 2010, though results will be negatively impacted by various issues stemming from purchase orders from Brazil and the Republic of South Africa. While FHCO expects positive operating earnings for fiscal 2011, the company said it expects those results to fall below previous guidance.

Despite the aforementioned obstacles, the company noted the severity of HIV/AIDS and the emphasized the need for prevention and education on the disease.

“Over the past years, the face of AIDS has become feminized. Globally, HIV/AIDS is the leading cause of death for women of reproductive age (15-44). Women now comprise more than 50 percent of adult HIV/AIDS cases. These facts have raised awareness of the need for prevention, as evidenced by the fact that FC2 is now available in 120 countries around the world. Although our financial results have been constrained by continued bureaucratic delays related to the timing and shipment of certain large orders, we are confident that the fundamentals of our business remain strong and that demand for, and acceptance of, the FC2 Female Condom, continues to increase,” O.B. Parrish, chairman and CEO of FHCO stated in the press release.

Parrish said the company anticipates continued demand for its products based on several broader factors.

“We are very encouraged by recent indications of demand growth from customers that distribute female condoms globally and believe the long-term outlook for the company remains positive for three reasons: the feminization of HIV/AIDS, the complexity of developing easy-to-use alternative prevention methods, and the emergence of drug resistant strains of sexually transmitted infections (STIs),” he stated.

The company also declared a quarterly cash dividend of $0.05 per share, payable August 9, 2011, to stockholders of record as of August 2, 2011, reflecting the company’s strength in the midst of a temporary setback with its Brazil orders.

“While our operating results have suffered due to timing issues involving large orders during the current fiscal year, we have continued to generate cash flows from operations that significantly exceed our capital spending requirements, and our balance sheet remains free of debt. We remain highly optimistic regarding the company’s future and the expanding role that FC2 will play in the global battle against HIV/AIDS,” Parrish stated.

FHCO is slated to report its operating results for the three and nine months ended June 30, 2011, on August 5, 2011.

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Forward-Looking Statement:

This release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All forward-looking statements are inherently uncertain as they are based on current expectations and assumptions concerning future events or future performance of the company. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. Risks and uncertainties applicable to the company and its business could cause the company's actual results to differ materially from those indicated in any forward-looking statements.