The company said that it has already received several offers for the business and is currently in negotiations with one party, although Zila officials did not disclose that companys name.
It is our intent to either close transaction with that party or continue our negotiations with other interested bidders to determine whether we are able to close a transaction under acceptable terms, said Douglas Burkett, PhD, Zila chairman, president and CEO. If we choose to not divest the business in the near term, we believe it will return to a positive EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) performance within the next several months although no assurance can be given in this regard.
The three month net revenues for Zila that ended April 30, 2006 decreased 65% to $3.6 million compared to $10.4 million for the three months ended on April 30, 2005. Gross margins decreased to 63% for the three months ended April 30, 2006 compared to 70% for the three months ended April 30, 2005.
Zila expanded the international presence of the Ester-C by signing an agreement with distribution Lohaspia in Korea and Taiwan and Gee Lawson in the EU. The company also developed a new and improved form of its Ester-C product, which extends patent protection for this new form of Ester-C until 2019. The new product offers all the benefits of Zilas traditional Ester-C plus an additional metabolite designed to enhance its antioxidant and immune enhancing potential.