Financial Results

AMDL has a highly seasonal business that has historically resulted in low first quarter revenues and earnings. Given this seasonality, our first quarter results were within our expectations.

For the first quarter 2009 AMDL reported unaudited net revenues of approximately $2.71 million, a decrease of 7.8% compared with approximately $2.94 million in sales reported for the same period in FY2008. The decrease in net revenues was anticipated due to the seasonal nature of AMDL's business combined with the Company's inability to produce Goodnak(R) and Human Placenta Extract (HPE) anti-aging products dependent on a non-operational small-injectable production line which was off-line while awaiting mandatory 5-year GMP re-certification from the sFDA. In addition, distribution contracts with four primary beauty distributors expired during the fourth quarter of FY2008, impacting sales of other HPE-based anti-aging solutions. AMDL manufactured additional Goodnak and other small-injectable line dependant products in anticipation of these events and depleted product inventories sooner than anticipated due to higher than expected sales prior to year-end FY2008. The Company received re-certification on May 8, 2009 for the off-line small-injectable line and has resumed full product production. The Company is also in current re-negotiations to renew the expired distributor contracts pertaining to the HPE-based anti-aging solutions.

Gross profits for the first quarter FY2009 decreased to approximately $1.1 million compared to approximately $1.4 million for the same period in FY2008.

Selling, general and administrative expenses for the Company were approximately $2.59 million for the quarter ended March 31, 2009 as compared to approximately $2.80 million for the same period in FY2008 due to a reduction in payroll expense and professional fees.

Loss before discontinued operations for the quarter ended March 31, 2009 was $1.9 million, or $0.12 per share compared to the quarter ended March 31, 2008 when the Company's loss before discontinued operations was $1.7 million, or $0.11 per share. As previously announced, AMDL has discontinued operations at its YYB subsidiary and is negotiating the sale of that facility. For the quarter ended March 31, 2009 the Company recognized income of approximately $247,000 from discontinued operations.

"Seasonally the first quarter is consistently our most challenging, and as we communicated in our FY2008 earnings call, we anticipated first quarter results to be slightly lower than the corresponding period last year," commented Mr. Douglas MacLellan, Chairman and Chief Executive Officer of AMDL, Inc.