Executive Summary

Q1 2021 was weak: net sales fell 22.4% year over year to $0.566M, with operating loss widening to $0.509M and net loss to $0.556M as Covid-related demand declined and manufacturing inefficiencies and debt-related fees pressured results .
Covid antigen distribution was curtailed mid-quarter in the U.S.; management secured an antigen/Influenza combo and an alternative antibody test under EUA to backfill, but sales remained muted and gross profit compressed to 18.6% of net sales (vs 26.1% in Q1 2020) .
Liquidity remains tight: cash of $0.063M, total debt of $1.867M, and working capital deficit of $2.119M; Cherokee loans were extended with higher rates and penalties, lifting G&A expense by ~$153k year over year .
No formal guidance or Street consensus estimates were available via S&P Global; near-term catalysts hinge on Covid test portfolio traction, resumption of contract manufacturing shipments in Q2, and any refinancing or equity raises to bridge liquidity .

What Went Well and What Went Wrong

What Went Well

Management secured the ability to offer a Covid-19 antigen/Influenza combo test and an alternative rapid Covid-19 antibody test under EUA to broaden the portfolio after antigen distribution was curtailed in the U.S. .
- “In late April 2021, we did secure the ability to offer a Covid-19 antigen/Influenza combination test… along with another rapid Covid-19 antibody test… under the Emergency Use Authorization…” .
Early signs of recovery in contract manufacturing: ABMC began discussions to resume shipments; purchase orders exist with both customers and one new order placed in April (expected to ship in Q2 2021) .
Slight improvement in clinical market demand and flat international sales vs Q1 2020 suggest nascent normalization in some end-markets .

What Went Wrong

Covid test sales declined sharply; the manufacturer barred ABMC from selling its Covid antigen test in the U.S. mid-quarter, and Healgen antibody test supply issues further pressured sales .
Gross margin contracted to 18.6% due to lower manufacturing volumes and pricing pressure in commoditized drug testing, leading to higher fixed-cost absorption and inefficiencies .
Operating expenses rose $153k, entirely in G&A, driven by Cherokee loan extension fees (~$148k) and audit-related costs, widening operating loss and net loss .

Financial Results

Quarterly Trend (Q3 2020 → Q4 2020 → Q1 2021)

Metric	Q3 2020	Q4 2020	Q1 2021
Revenue ($USD)	$883,000	$777,000	$566,000
Gross Profit ($USD)	$235,000	$230,000	$105,000
Operating Income (Loss) ($USD)	$(172,000)	$(193,000)	$(509,000)
Net Income (Loss) ($USD)	$(216,000)	$(233,000)	$(556,000)
Diluted EPS ($USD)	$(0.01)	$(0.01)	$(0.01)

Year-over-Year Comparison (Q1 2020 → Q1 2021)

Metric	Q1 2020	Q1 2021
Revenue ($USD)	$729,000	$566,000
Gross Profit ($USD)	$190,000	$105,000
Gross Margin (%)	26.1%	18.6%
Operating Income (Loss) ($USD)	$(271,000)	$(509,000)
Net Income (Loss) ($USD)	$(325,000)	$(556,000)
Diluted EPS ($USD)	$(0.01)	$(0.01)

KPIs and Balance Sheet Items

KPI	Q3 2020	Q4 2020	Q1 2021
Cash and Cash Equivalents ($USD)	$61,000	$98,000	$63,000
Accounts Receivable, net ($USD)	$364,000	$407,000	$337,000
Inventory, net ($USD)	$602,000	$536,000	$507,000
Total Liabilities ($USD)	$3,021,000	$3,182,000	$3,198,000
Working Capital Deficit ($USD)	—	$841,000	$2,119,000
Total Debt ($USD)	—	$1,804,000	$1,867,000

Segment breakdown: The company does not disclose revenue by segment/product; commentary references drug tests, Covid tests, and contract manufacturing, but no quantitative segment detail was provided .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Total Revenue	FY 2021	Not provided	Not provided	No formal guidance
Gross Margin	FY 2021	Not provided	Not provided	No formal guidance
Operating Expenses	FY 2021	Not provided	Not provided	No formal guidance
Tax Rate	FY 2021	Not provided	Not provided	No formal guidance
Contract Manufacturing Shipments	Q2 2021	N/A	Expected to ship existing POs; one new April order	Operational update (not formal guidance)

Earnings Call Themes & Trends

No Q1 2021 earnings call transcript was found in the document catalog; themes below synthesize press releases and 10-Q MD&A .

Topic	Previous Mentions (Q3 2020 and Q4 2020)	Current Period (Q1 2021)	Trend
Covid testing mix and demand	Pivot to distribute antibody tests; demand shifting to diagnostics; added Co-Diagnostics PCR test; antibody demand expected with vaccines . FY/Q4 noted Covid test sales of $1.573M in 2020; anticipated decline in 2021 as vaccines rolled out .	Antigen distribution halted mid-Q1 in U.S.; secured antigen/Influenza combo and alternative antibody test; Covid sales declined; Healgen supply issues; no PCR sales due to equipment backlogs .	Deteriorating demand; portfolio adjusted to mitigate
Core drug testing markets	Still down due to Covid impact; cautious optimism; price competitiveness noted .	Sporadic improvement; government/employment/clinical markets remain uncertain; slight improvement in clinical; pricing pressure persists .	Gradual normalization in pockets; overall weak
Contract manufacturing	Two customers onboarded in 2019 but halted by Covid; signs of rebound .	Discussions to resume; open POs from 2020; shipments expected starting Q2 2021; pilot with potential new customer .	Improving; Q2 execution key
Financing/liquidity	Applied to up-list to OTCQB; exploring financing; PPP loan .	Lincoln Park equity line active ($381k proceeds in Q1); Cherokee debt extended with higher costs; working capital deficit widened .	Liquidity pressure elevated; dependent on external financing
Regulatory/EUA	Distribution of antibody and PCR tests .	EUA-compliant antigen/Influenza combo, alternative antibody test; CLIA-waived fingerstick antibody test .	Expanded compliant offerings

Management Commentary

“Sales of Covid-19 tests have declined significantly from previous levels… we were informed by the manufacturer… that we could no longer offer the Covid-19 antigen test for sale in the United States” .
“Operating expenses increased $153,000 in the first quarter 2021 compared to the first quarter 2020… due to increased fees associated with debt as well as increased accounting fees” .
“We have open purchase orders (from 2020) with both [contract manufacturing] customers and we expect to ship those orders in the second quarter of 2021… starting a pilot with a potential new… customer later this month” .
“Gross profit decreased to 18.6% of net sales… Manufacturing inefficiencies occur when revenues decline… certain overhead costs are fixed… Lower product pricing… also negatively impacts gross profit” .

Q&A Highlights

No earnings call transcript was available; no Q&A or guidance clarifications were disclosed in the filings/press releases .

Estimates Context

Wall Street consensus estimates via S&P Global were unavailable due to missing CIQ mapping for ABMC; therefore, no comparisons to consensus EPS or revenue could be performed [GetEstimates error].
In absence of estimates, the quarter is assessed against prior periods and management’s qualitative commentary; any future consensus emergence would likely point to lower revenue and margin expectations given Q1 trends .

Key Takeaways for Investors

Revenue reset: Q1 net sales down 22.4% YoY, with gross margin compression to 18.6% signaling ongoing price/mix and volume pressures in drug testing and Covid products .
Liquidity watch: Cash of $0.063M vs total debt $1.867M and working capital deficit of $2.119M; Cherokee facilities mature 2/15/2022 with higher interest/penalties—equity line and refinancing are critical near-term levers .
Covid portfolio execution: New EUA antigen/Influenza and alternative antibody tests provide optionality, but demand headwinds and supply constraints (Healgen) weigh; monitor Q2 sell-through and any PCR traction .
Contract manufacturing is the potential near-term offset: shipment of existing POs and new pilot in Q2 could stabilize revenue; track conversion and volumes .
Cost discipline: Elevated G&A from financing costs widened losses; management is pursuing manufacturing cost reductions and selective pricing actions in commoditized markets—watch margin recovery signals .
No formal guidance or Street coverage: Position sizing should reflect headline/financing risk; catalysts include Q2 shipment execution, capital raises/loan refinancing, and any recovery in core drug testing demand .
Trading implication: Absent estimates, stock may trade on liquidity headlines and Covid product announcements; downside risk tied to financing outcomes, upside from contract manufacturing volume and successful Covid test distribution .

AMERICAN BIO MEDICA CORP (ABMC)·Q1 2021 Earnings Summary