
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, March 29, 1995                   TAG: 9503290079
SECTION: BUSINESS                    PAGE: B-6   EDITION: METRO 
SOURCE: MAG POFF STAFF WRITER
DATELINE:                                 LENGTH: Short

STERILE CONCEPTS TAKES LOSS

Sterile Concepts Holdings Inc. of Richmond, formerly owned by Carilion Health System of Roanoke, said Tuesday that it expects net earnings for the second quarter ending March 31 to be 20 to 35 percent below first quarter income of 43 cents a share.

The company said sales during the remaining two quarters of the year should return to normal levels. Sales in this quarter are expected to be $34 million. In the year ended Sept. 30, sales reached $132 million.

The company's common stock, trading on the New York Stock Exchange, fell $3.75 Tuesday to $12.375.

The earnings weakness in the second quarter reflects lower than anticipated sales revenue and lower gross profit margins, a result of lower sales and industrywide pressure to contain costs being exerted by hospitals and other health care organizations.

Paul Woo, the company's president, said pressure from hospitals for reduced prices and competition among custom-procedure tray packagers has led to reduced profit margins.

"Though historically we have been able to maintain margins in the 23-25 percent range, we believe margins in the 21-23 percent range are more realistic long term," Woo said.

He said the company is striving to be the lowest-cost converter of medical components into procedure trays and is also working with suppliers toward more competitive component pricing.

by CNB