Nichols Institute Reports Big Drop in Net Income

Citing its heavy investments for new product development, Nichols Institute, a San Juan Capistrano medical testing services provider, reported last week that net income in the first fiscal quarter plunged 86% to $32,000 from $234,000 a year earlier.

Sales for the period ended Feb. 28 were a record $7.6 million, 50% above the $5.1 million recorded in the prior year. The results include the operations of American Clinical Laboratories and BioDiagnostic Laboratories, which were acquired in late 1985.

Dr. Albert L. Nichols, board chairman and chief executive, said sales for the remainder of the year are expected to remain strong as a result of the company’s introduction of 15 new medical tests during the first quarter of the year.

In addition, Nichols said the company has accelerated development of its new Allegro line of tests. The line uses a new technology that is easier to use and gives faster test results. So far, the company said, three of its kits using this new technology have been approved by the U.S. Food and Drug Administration and have been released for sales.