Human Pheromone Sciences Announces Second Quarter Results SAN JOSE, Calif., Aug. 16 /PRNewswire-FirstCall/ -- Human Pheromone Sciences, Inc. (OTC:EROX) (BULLETIN BOARD: EROX) ("HPS" or "the Company") today announced results for the second quarter ended June 30, 2004. As a result of the April 14, 2003 sale of its REALM(R) and innerREALM(R) trademarks and related assets, the reported financial data for the current year include information for both the on-going operations, discontinued operations and in 2003, as the net gain from sale of assets. Net revenues of $149,000, represented a 144% increase from the sales of $61,000 in the prior year period, and resulted in an operating loss from on-going operations of $279,000 ($.07 per share) as compared with an operating loss from on-going operations of $226,000 ($.05 per share) for the same period of 2003. For the six months ended June 30, 2004, net revenues were $408,000, a 46% increase from the revenues of $279,000 in the prior year period, and resulted in an operating loss from on-going operations of $370,000 ($.09 per share) as compared with an operating loss from on-going operations of $339,000 ($.08 per share) for the same period of 2003. The Company indicated that is was very pleased by the increase in revenue for the period, with the growth attributable to the launch of its new Demeter Natural Attraction line in the U.S. in April 2004, increased pheromone sales domestically, and higher private label business outside the United States. Gross margin improved over the prior year in both the quarter and six months as a result of lower product costs. Product development, package development and introduction expenses for these new products were the primary factors in the increase in selling, general and administrative expenses in both periods of 2004. The Company noted that these figures were in line with its plans. "We anticipate additional launches of the Demeter Natural Attraction brand in the third and fourth quarters," a spokesperson indicated. Human Pheromone Sciences, Inc. is a technology-based company, whose proof-of-concept products included prestige-priced fragrances and toiletries and environmental products sold under the REALM(R), innerREALM(R), EROX(R) and Natural Attraction(R) trademarks. These products contain synthesized human pheromones covered under U.S. and foreign patents. Scientific and consumer studies have shown that the Company's human pheromones positively impact on the moods, attitudes and emotions of wearers. Further information is available on line at http://www.naturalattraction.com/. The statements in this news release may contain forward-looking statements that involve risks and uncertainties that could cause results to differ from predicted results. Further information on factors that could affect the Company's results is detailed in the Company's annual report to shareholders on Form 10-KSB for the year ended December 31, 2003 as filed with the Securities and Exchange Commission. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements. HUMAN PHEROMONE SCIENCES, INC. Condensed Balance Sheets (Unaudited) (Dollars in thousands) June 30, December 31, 2004 2003 Assets Cash and cash equivalents $1,473 $1,950 Accounts receivable, net 79 38 Inventories 74 52 Other current assets 46 19 Property and equipment, net 22 9 Total $1,694 $2,068 Liabilities, convertible redeemable preferred stock and shareholders' deficit Accounts payable $40 $23 Other current liabilities 121 150 Convertible redeemable preferred stock -- 150 Common stock 20,809 20,659 Accumulated deficit (19,276) (18,914) Total $1,694 $2,068 HUMAN PHEROMONE SCIENCES, INC. Condensed Statements of Operations (Unaudited) (Dollars in thousands, except per-share data) Three months Six months ended June 30, ended June 30, 2004 2003 2004 2003 Net sales and revenues $149 $61 $408 $279 Cost of goods sold 33 19 73 84 Research and development 7 4 16 7 Selling, general and administrative 388 264 689 527 (Loss) from operations (279) (226) (370) (339) Other income 4 5 7 8 Tax benefit from ongoing operations -- 33 -- 33 (Loss) from continuing operations (275) (188) (363) (298) Net income from disposed operations -- 7 -- 79 Net gain on sale of assets 1 1,226 1 1,226 Net income (loss) $(274) $1,045 $(362) $1,007 Basic earnings (loss) per share: From on-going operations $(0.07) $(0.05) $(0.09) $(0.08) From disposed operations $0.00 $0.00 $0.00 $0.02 From assets to be sold $0.00 $0.33 $0.00 $0.34 Net income (loss) $(0.07) $0.28 $(0.09) $0.28 Diluted earnings (loss) per share: From on-going operations $(0.07) $(0.04) $(0.09) $(0.06) From disposed operations $0.00 $0.00 $0.00 $0.02 From assets to be sold $0.00 $0.26 $0.00 $0.24 Net income (loss) $(0.07) $(0.22) $(0.09) $0.20 Weighted average number of shares outstanding - Basic 3,686 3,686 3,558 3,558 Weighted average number of shares outstanding - Assuming dilution 3,686 4,773 3,558 5,011 Net income (loss) per share is based on the weighted average number of common shares and common equivalents outstanding during each period. Certain common stock equivalents are excluded when their effect would be anti-dilutive. DATASOURCE: Human Pheromone Sciences, Inc. CONTACT: William P. Horgan, Chairman, CEO of Human Pheromone Sciences, Inc., +1-408-938-3030 Web site: http://www.naturalattraction.com/ Web site: http://www.realmfragrances.com/

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