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8/22/2006 10:22:13 AM ET
SWISS MEDICA ANNOUCES SECOND QUARTER RESULTS
FOR IMMEDIATE RELEASE
Stock Symbol: OTC BB: SWME
June 17, 2006
Toronto, Canada – Swiss Medica, Inc. (OTC BB: SWME) announces gross revenues were US$384,927 for the
second quarter ending June 30, 2006 compared with gross/net revenues of US$1,383,328 for the quarter ended
June 30, 2005 and gross/net revenues 1,221,501 for the quarter ended March 31, 2006. Net revenues, after
product returns, for the quarter ended June 30, 2006 were US$126,555.
A U.S. retailer decided to return all O24 products due to sales levels that did not meet acceptable levels, which
accounted for the sales returns of $258,372 during the quarter ended June 30, 2006. Swiss Medica has
commenced a collection action against this retailer to pay its accounts payable to Swiss Medica.
In addition, the cost of sales for our quarter ending June 30, 2006 were $272,852 compared to $256,137 for the
three months ending June 30, 2005. As a result of the return of the O24 20 foil pouch pack skus from a major
retailer, a charge to cost of sales was incurred during the quarter ended June 30, 2006, totaling $300,647.
Although it is Management’s belief that it was not bound to accept this product return, it was decided to accept
the return in order to maintain and ensure ongoing good relations with this retailer, who is still carrying several
other skus of our products. Swiss Medica anticipates normalized gross profit percentages on revenues to be
between 70% and 80%, depending on the distribution mix of our revenue streams.
Swiss Medica has decided to re-focus the O24 20 foil pouch pack skus toward the healthcare professional
market in the United States, which favors the O24 foil pouches due to their unique portability, hygiene control
and dosage control attributes.
The O24 one ounce spray bottle sku continues to be the main focus of the retailers in the United States due to
retailer and consumer familiarity with the spray bottle delivery system.
“We are greatly disappointed with our results, which occurred despite growing international interest in our O24
products, and continued accolades for our products from consumers and leading consumer pain associations
including the National Fibromyalgia Association and large regional arthritis foundations.” said Chief Executive
Officer, Raghu Kilambi. “Our senior team firmly believes in our long term business model of commercializing
patented, clinically tested, elite all natural products for chronic ailments. However, it is clear that building new
categories takes time and perseverance. We have learned a lot about the USA marketplace in the past 18
months and recognize that strategies that may have delivered significant results in Canada may not be
appropriate in the United States and vice versa.”
“Despite this weak quarter, I continue to be convinced that Swiss Medica’s world class products will gain
mainstream acceptance in the United States and other markets. I am very committed to Swiss Medica’s success
and my personal confidence is shown in recent insider buying and loans to Swiss Medica to lower our cost of
capital. I am confident that recent initiatives that the Company has launched will lead to much stronger results in
the near future”, continued Raghu Kilambi.
Full second quarter results, for the period ending June 30, 2006, are included in the Company’s 10-Q. which has
been filed with the U.S. Securities and Exchange Commission and also available on the Swiss Medica website at
www.swissmedica.com.
Swiss Medica will separately announce a conference call in the next several weeks to discuss the second quarter
and further developments in the third quarter.
About Swiss Medica, Inc.
Swiss Medica commercializes proprietary bioscience products that relieve chronic ailments. We increase our
market share through focused distribution strategies in multiple sales channels. Swiss Medica's mission is to be
a world leader in the commercialization of life enhancing bioscience products that improve quality of lives. Please
visit our websites at www.swissmedica.com, www.O24zone.com and www.pmsescape.com.
Swiss Medica's flagship product, the O24™ Pain Neutralizer, holds US Patent #6,444,238B1. The O24™ pain
relief solution has been used, recommended and praised for its fast-acting and long-lasting benefits by
healthcare professionals and athletes in the United States, Canada and in Europe. O24™ is widely available
throughout the United States and Canada in leading pharmacies and other retailers. Customers can also visit
www.O24zone.com, for ordering details and store locators for the nearest pharmacy.
Swiss Medica launched the patented O24 Fibromyalgia™ pain reliever (US Patent #6,444,238B1) over-the-
counter in North American retailers in the fall of 2005. The National Fibromyalgia Association (NFA) recently
awarded O24 Fibromyalgia™ their first NFA Seal of Approval. Upwards of 11 million Americans suffer from the
long-term pain associated with fibromyalgia. In a randomized double blind clinical trial, more than 90 per cent of
the patients who used O24 Fibromyalgia™ reported mild to markedly better improvement, versus only 7 per cent
who used the placebo. Customers can visit www.024zone.com for information on O24 Fibromyalgia™ and to
order the product online.
Swiss Medica also manufactures PMS Escape® which holds US Patent #'s 5760014 and 5612320. PMS
Escape® is a specially formulated group of carbohydrates, vitamins and minerals, clinically proven to reduce
changes in mood and appetite that women experience during the premenstrual period. Customers can also visit:
www.pmsescape.com for additional information and ordering details.
Forward-looking statements in this news release are made pursuant to the "Safe Harbor" provisions of the
United States Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking
statements involve risks and uncertainties, including, without limitation, risks relating to the ability to close
transactions being contemplated, risks related to international sales and potential foreign currency exchange
fluctuations, continued acceptance of Swiss Medica's products, increased levels of competition, technological
changes, dependence on intellectual property rights and other risks detailed from time to time in Swiss Medica's
periodic reports filed with the United States Securities and Exchange Commission and other regulatory
authorities.
For more information, please contact:
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