Osteotech Reports 2007 Third Quarter Financial Results; Core Segment Revenue Increased 28%; Gross Margin Improved to 55%; Diluted Earnings Per Sha...( EATONTOWN N.J. Nov. 6 /- Osteotec...),Health

EATONTOWN, N.J., Nov. 6 /PRNewswire-FirstCall/ -- Osteotech, Inc. (Nasdaq: OSTE) announced today that third quarter 2007 revenue increased $2.3 million to $25.7 million from third quarter 2006 revenue of $23.4 million. Revenue from Osteotech's "core" DBM and Hybrid/Synthetic Segments increased 28% to $17.6 million for the three months ended September 30, 2007 as compared to revenue of $13.7 million from the same segments for the third quarter of 2006. Gross margin improved to 55% in the third quarter of 2007 as compared to 49% in the third quarter of 2006. Net income for the three months ended September 30, 2007 was $1.6 million, or $.09 diluted earnings per share, compared to net income of $.2 million, or $.01 diluted earnings per share, for the three months ended September 30, 2006.

Sam Owusu-Akyaw, Osteotech's President and Chief Executive Officer, stated, "We are very pleased with the results of the productivity initiative started two and one-half years ago to turn the company around. We are very proud of the discipline and focus the team has demonstrated to drive the improvement in gross margin, the increase in our cash position, and the return of the Company to profitability. The team is now focused to deliver new and innovative products and to drive revenue growth."

Revenue for the nine months ended September 30, 2007 increased 5% to $77.3 million from $73.8 million for the nine months ended September 30, 2006. Revenue increased 14% to $49.9 million in the DBM and Hybrid/Synthetic Segments for the nine months ended September 30, 2007 as compared to revenue from the same segments for the nine months ended September 30, 2006 of $43.6 million. Gross margin improved to 51% for the nine months ended Sept
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