INTERIM
REPORT
(FOURTH QUARTER,
2000)
February 9, 2001
Dear
Stockholder:
As
we have been doing for the past couple of years we are
issuing this Interim Report to keep our stockholders
updated on the events that have taken place since the Nine
Month Report was issued on November 15th of
last year. Our
next full report will be the Annual Report to Stockholders
that will be issued in April.
While
our final financial figures for the year will not be
reported until next month, I can report that we expect to
finish the year with a significant increase in sales and
earnings over last year.
We had a very strong fourth quarter, and I believe
that our stockholders are going to be very pleased with
the end of the year results. I am also happy to report that we had a very good start to
the new fiscal year, with sales in January exceeding $1
million. Considering
the fact that November and December had been very strong
as well, we are very optimistic about this excellent start
to the new fiscal year.
One
of the most significant areas of growth for us over the
past year has been sales of our Lubrajel line of products
into Mainland China.
We recently met with International Specialty
Products, our marketing arm in China, and according to
them we now have a couple of hundred customers in China
for our Lubrajel products, including some of the largest
producers of cosmetics in China, and they expect this to
continue to grow. I
will report in more detail about our increased marketing
efforts worldwide in the Annual Report to Stockholders in
April.
Our
project with a major consumer products company in the
United Kingdom that has been evaluating a variation of one
of our Lubrajel products for a widely used consumer health
care product is continuing, and they recently placed a
second order for product to be delivered in March.
Their initial test marketing of the product did not
turn up any problems that would prevent them from
initiating a full scale marketing effort in the near
future. While the volumes are still not significant, we
expect sales to them over the next year to grow as they
introduce the product into more of their manufacturing
plants worldwide. While
the introduction of the new product has been done at a
slower pace than we originally expected, in the long run
this should be an excellent revenue producer for us.
We have
been working on several fronts to expand the marketing of
our Razoride shaving gel.
We have suspended our experimental sampling program
on our web site, but are still receiving occasional orders
and reorders for the product from people all over the
country who are enthusiastic about the product.
We recently signed a contract with a catalog
marketing company that intends to market this product, as
well as other products of ours, to the mail order catalogs
that they work with.
We always felt that this particular product could
be marketed very effectively if we found the right company
to assist us, and I think we now have.
We are also working with Kline & Company, a
well known international business consultant, to locate
possible marketers of this product into the retail sector.
Although their report to us is not due until
mid-February, they have already generated some potential
leads that we are following up.
We are also working with an advertising agency that
has put us in touch with one of their customers that is
interested in working with this product as well as other
products of ours. We
are hopeful that with all of these efforts going on
simultaneously we will be able to
generate the sales of this product that we have
long believed were possible.
The
results from our latest tests of Sonarite, our proprietary
formulation to reduce snoring and sleep apnea, showed that
the product is still not as effective as an earlier
formulation had been.
That formulation had to be discontinued because of
the inclusion of a raw material that was not approved for
our intended use.
We have now made what we believe will be our final
modification to the formulation, and we are hoping that
this change will bring the efficacy of the product up to
the level of the earlier formulation.
We expect to have this formulation tested by Queens University in Canada in the next few weeks.
The results of these tests will determine whether
or not this project will be continued.
We have
now made tentative arrangements with the Boston University
School of Dental Medicine to work with us to determine the
effectiveness of Clorpactin, our proprietary antimicrobial
product, in treating gingivitis, a disease of the gums.
We expect this work to be completed, and a report
issued, by mid-year.
We believe
that you will be very pleased with the financial results
for 2000, and we are very excited about our prospects for
2001.
Sincerely,
UNITED-GUARDIAN, INC.
Dr. Alfred R. Globus
Chairman
and CEO