ProPhase Labs Reports Financial Results for the First Quarter Ended March 31, 2013

ProPhase Labs Reports Financial Results for the First Quarter Ended March 31, 
DOYLESTOWN, PA -- (Marketwired) -- 05/06/13 --  ProPhase Labs, Inc.
(NASDAQ: PRPH) ( today reported a net sales
increase of 25.3% to $7.5 million for the three months ended March
31, 2013 as compared to net sales of $6.0 million for the three
months ended March 31, 2012. 
The Company realized net income for the three months ended March 31,
2013, of $290,000, or $0.02 per share, compared to a net loss of
$688,000, or ($0.05) per share, for the three months ended March 31,
2012. The improved financial results for the three months ended March
31, 2013 as compared to three months ended March 31, 2012 was due
principally to increased revenues while the Company maintained
comparable operating expenses from period to period.  
Ted Karkus, ProPhase Labs' Chairman and CEO stated, "Much like in
2012, our goal going forward is to introduce new Cold-EEZE(R) branded
products which efficiently leverage our marketing dollars and
leverage our strengthening distribution platform. As previously
articulated, our next generation of Cold-EEZE(R) products (which we
expect to be on shelves in the fall of 2013) will not be new flavors
of lozenges but rather Cold-EEZE(R) products in new delivery forms
that shorten the duration of the common cold as well as provide
additional health benefits. As evidenced in our most recent financial
results, we continue to make excellent progress toward our long term
strategy of increasing the value of the Cold-EEZE Cold Remedy brand
and the value of our Company to the benefit of all shareholders." 
About ProPhase Labs 
ProPhase Labs is a diversified natural health medical science
company. It is a leading marketer of the Cold-EEZE(R) Cold Remedy
brand as well as other cold relief products. Cold-EEZE(R) zinc
gluconate lozenges are clinically proven to significantly reduce the
severity and duration of the common cold. Cold-EEZE(R) customers
include leading national retailers, chain food, drug and mass
merchandise stores, wholesalers and distributors, as well as
independent pharmacies. ProPhase Labs has several wholly owned
subsidiaries including a manufacturing unit, which consists of an FDA
registered facility to manufacture Cold-EE
ZE(R) lozenges and fulfill
other contract manufacturing opportunities. ProPhase also owns 50% of
Phusion Laboratories, LLC ("Phusion"). Phusion licenses a
revolutionary proprietary technology that has the potential to
improve the delivery and/or efficacy of many active ingredients or
compounds. Phusion will formulate and test products to exploit market
opportunities within ProPhase's robust over-the-counter distribution
channels. For more information visit us at 
Except for the historical information contained herein, this document
contains forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements involve a
number of risks and uncertainties, including the difficulty of the
acceptance and demand for our products, the impact of competitive
products and pricing, the timely development and launch of new
products, and the risk factors listed from time to time in our Annual
Report on Form 10-K, Quarterly Reports on Form 10-Q and any
subsequent SEC filings. 

                     PROPHASE LABS, INC. & SUBSIDIARIES                     
                   CONSOLIDATED STATEMENTS OF OPERATIONS                    
                  (in thousands, except per share amounts)                  
                                                         Three Months Ended 
                                                             March 31,      
                                                           2013      2012   
                                                        --------- --------- 
Net sales                                               $   7,542 $   6,018 
Cost of sales                                               2,203     1,678 
                                                        --------- --------- 
Gross profit                                                5,339     4,340 
                                                        --------- --------- 
Operating expenses:                                                         
  Sales and marketing                                       3,363     3,177 
  Administrative                                            1,498     1,492 
  Research and development                                    188       361 
                                                        --------- --------- 
                                                            5,049     5,030 
                                                        --------- --------- 
Income (loss) from operations                                 290      (690)
Interest and other income                                       -         2 
                                                        --------- --------- 
Income (loss) before income taxes                             290      (688)
Income tax (benefit)                                            -         - 
                                                        --------- --------- 
Net Income (loss)                                       $     290 $    (688)
                                                        ========= ========= 
Basic income (loss) per share:                                              
                                                        --------- --------- 
  Net income (loss)                                     $    0.02 $   (0.05)
                                                        ========= ========= 
Diluted income (loss) per share:                                            
                                                        --------- --------- 
  Net income (loss)                                     $    0.02 $   (0.05)
                                                        ========= ========= 
Weighted average common shares outstanding:                                 
    Basic                                                  15,752    14,796 
                                                        ========= ========= 
    Diluted                                                16,199    14,796 
                                                        ========= ========= 
                    ProPhase Labs, Inc. and Subsidiaries                    
                  Condensed Consolidated Balance Sheet Data                 
                               (in thousands)                               
                                                March 31,      December 31, 
                                                   2013            2012     
                                             --------------- ---------------
Cash and cash equivalents                    $         4,536 $           572
Accounts receivable                          $         3,080 $         5,409
Inventory                                    $         2,147 $         2,051
Total current assets                         $        10,251 $        10,719
Total assets                                 $        16,139 $        16,661
Total current liabilities                    $         3,864 $         4,910
Other long term obligations                  $           300 $           300
Total stockholders' equity                   $        11,975 $        11,451

Press Only Contact
Laura Maxey
5W Public Relations
Tel: (212) 452-6400 
Investor Contact
Ted Karkus
Chairman and CEO
ProPhase Labs, Inc. 
(215) 345-0919 x 0 
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