Exhibit 99.1

Chembio Diagnostics Reports First Quarter 2022 Financial Results

HAUPPAUGE, NY, May 5, 2022 -- Chembio Diagnostics, Inc. (“Chembio” or the “Company”) (Nasdaq: CEMI), a leading point-of-care diagnostics company focused on infectious diseases, today reported financial results for the quarter ended March 31, 2022.

Recent Highlights

Gross product margin for the first quarter of 2022 was $3.3 million, compared to $0.5 million for the prior year period. Gross product margin percentage for the first quarter of 2022 was 18%, compared to 12% for the prior year period. Gross product margin in the first quarter of 2022 was driven by increased product volume sold in US and Latin America at higher average selling prices and operational productivity.

Research and development expenses decreased by $1.2 million, or 42%, in the first quarter of 2022 compared to the prior year period. Selling, general and administrative expenses increased by $0.9 million, or 14%, in the first quarter of 2022 compared to the prior year period.

Impairment, restructuring, severance and related costs for the first quarter of 2022 totaled $3.0 million, including an impairment of goodwill.

Cash and cash equivalents as of March 31, 2022 totaled $24.4 million, compared to $28.8 million at December 31, 2021.

Going Concern Considerations

The Company continued to experience market, clinical trial and regulatory complications in seeking to develop and commercialize a portfolio of COVID-19 test systems during the continuing, but evolving, uncertainty caused by COVID‑19. For the three months ended March 31, 2022, the Company continued to incur significant expenses in connection with pending legal matters.

The Company performed an assessment to determine whether there were conditions or events that, considered in the aggregate, raised substantial doubt about the Company’s ability to continue as a going concern within one year after the date the Company’s unaudited condensed consolidated financial statements for the three months ended March 31, 2022 are being issued (the “Q1 Financials Issuance Date”). Initially, this assessment did not consider the potential mitigating effect of management’s plans that had not been fully implemented. Because, as described below, substantial doubt was determined to exist as the result of this initial assessment, management then assessed the mitigating effect of its plans to determine if it is probable that the plans (1) would be effectively implemented within one year after the Q1 Financials Issuance Date and (2) when implemented, would mitigate the relevant conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern.

The Company achieved significant revenue growth in recent years while profitability has not been at levels as expected. It has taken steps, including investments in automation, to mitigate headwinds such as labor availability, volatile capacity planning and implementation of operational efficiency targets to proactively monitor production with the overarching goal for profitable growth. During the three months ended March 31, 2022, the Company undertook measures to increase its total revenues and improve its liquidity position by implementing the Global Competitiveness Program. The main pillars of the Global Competitiveness Program include the following:

In addition, the Company will continue to focus on regulatory approvals for its DPP SARS-CoV-2 Antigen test system, DPP Respiratory Antigen Panel, and DPP HIV-Syphilis test system. These measures and other plans and initiatives have been designed to provide the Company with adequate liquidity to meet its obligations for at least the twelve-month period following the Q1 Financials Issuance Date. The Company’s execution of those measures and its other plans and initiative continue to depend, however, on factors and uncertainties that are beyond the Company’s control, or that may not be addressable on terms acceptable to the Company or at all.

The Company considered in particular how:

The Company further considered how these factors and uncertainties could impact its ability over the next year to meet the obligations specified in its existing Credit Agreement. Those obligations include covenants requiring: i) minimum cash balance of $3.0 million and ii) minimum total revenue amounts for the twelve months preceding each quarter end. For the next year, the minimum total revenue requirements range from $43.8 million for the twelve months ending June 30, 2022 to$ 48.8 million for the twelve months ending March 31, 2023.   Upon an event of default under the Credit Agreement, the Lender could elect to declare all amounts outstanding thereunder, together with accrued interest, to be immediately due and payable. In such an event, there can be no assurance that the Company would have sufficient liquidity to fund payment of the amounts that would be due under the Credit Agreement or that, if such liquidity were not available, the Company would be successful in raising additional capital on acceptable terms, or at all, or in completing any other endeavor to continue to be financially viable and continue as a going concern. The Company’s inability to raise additional capital on acceptable terms in the near future, whether for purposes of funding payments required under the Credit Agreement or providing additional liquidity needed for its operations, could have a material adverse effect on its business, prospects, results of operations, liquidity and financial condition.

Accordingly, management determined the Company could not be certain that the Company’s plans and initiatives would be effectively implemented within one year after the Q1 Financials Issuance Date. Without giving effect to the prospect of raising additional capital pursuant to the Company’s existing At the Market Offering Agreement, increasing product revenue in the near future or executing other mitigating plans, many of which are beyond the Company’s control, it is unlikely that the Company will be able to generate sufficient cash flows to meet its required financial obligations, including its debt service and other obligations due to third parties. The existence of these conditions raises substantial doubt about the Company’s ability to continue as a going concern for the twelve-month period following the Q1 Financials Issuance Date.

The Company’s unaudited condensed consolidated financial statements for the three months ended March 31, 2022 have been prepared assuming the Company will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the Q1 Financials Issuance Date. As such, those unaudited condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets and their carrying amounts, or the amount and classification of liabilities that may result should the Company be unable to continue as a going concern.

Conference Call

Chembio will host a conference call today beginning at 4:30 pm ET to discuss its financial results and recent business highlights. Investors interested in listening to the call may do so by dialing 888-506-0062 from the United States or 973-528-0011 from outside the United States and providing entry code 898553. To listen to a live webcast of the call, please visit the Investor Relations section of Chembio's website at www.chembio.com. Following the call, a replay will be available on the Investor Relations section of Chembio’s website. A telephone replay will be available until 4:30 pm ET on May 19, 2022 by dialing 877-481-4010 from the United States or 919-882-2331 from outside the United States and using passcode 45278.

About Chembio Diagnostics

Chembio is a leading diagnostics company focused on developing and commercializing point-of-care tests used for the rapid detection and diagnosis of infectious diseases, including sexually transmitted disease, insect vector and tropical disease, COVID-19 and other viral and bacterial infections, enabling expedited treatment. Coupled with Chembio’s extensive scientific expertise, its novel DPP technology offers broad market applications beyond infectious disease. Chembio’s products are sold globally, directly and through distributors, to hospitals and clinics, physician offices, clinical laboratories, public health organizations, government agencies, and consumers. Learn more at www.chembio.com.

 

Investor Relations Contact

Philip Taylor

Gilmartin Group

(415) 937-5406

investor@chembio.com

CHEMBIO DIAGNOSTICS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

CHEMBIO DIAGNOSTICS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF

CHEMBIO DIAGNOSTICS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED

(Unaudited)

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