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SAN MARCOS, Calif., Nov. 13 /PRNewswire-FirstCall/ -- Natural Alternatives International, Inc. ("NAI") (Nasdaq: NAII), a leading formulator, manufacturer and marketer of customized nutritional supplements, today announced a net loss from continuing operations of $349,000 or $0.05 per share on net sales from continuing operations of $19.5 million for the quarter ended September 30, 2008.
The net sales from continuing operations of $19.5 million in the first quarter represented a decrease of $3.4 million or 14.8% from $22.9 million in the comparable prior year quarter. For the quarter ended September 30, 2008, contract manufacturing sales declined $3.1 million or 14.1% from the comparable quarter last year due to lower sales volumes to one of our largest customers and the impact of unfavorable foreign currency fluctuations. Net sales from our branded products declined $282,000 or 26.5% in the first quarter of fiscal 2009 compared to the first quarter of fiscal 2008 due to the continued softening of our Pathway to Healing(R) product line.
The net loss from continuing operations in the first quarter of fiscal 2009 was $349,000 or $0.05 per share compared to net income of $751,000 or $0.11 per diluted share in the first quarter of fiscal 2008. The net loss from continuing operations was primarily attributable to lower net sales and higher per unit manufacturing costs due to the lower sales volumes. We also incurred a net loss from discontinued operations of $1.048 million or $0.15 per share in the first quarter of fiscal 2009 compared to a loss of $328,000 or $0.05 per share in the first quarter of fiscal 2008. The increased net loss from discontinued operations was primarily attributable to employee termination costs, facility closure costs and loss on the sale of the As We Change(R) catalog. Overall, the first quarter loss was $1.397 million or $0.20 per share compared to income of $423,000 or $0.06 per diluted share in the comparable quarter last year.
As of September 30, 2008, NAI had cash and certificates of deposit of $3.8 million and working capital of $16.1 million compared to $3.5 million and $18.1 million, respectively, in the comparable prior year quarter. As of September 30, 2008, we had $6.6 million available under our working capital line of credit.
President Randell Weaver stated, "Like many other companies, the recent economic conditions have impacted our operations. During the remainder of fiscal 2009 we intend to aggressively manage our business to reduce costs as appropriate and leverage our state of the art and certified manufacturing facilities in an effort to expand our contract manufacturing customer base. For the second quarter of fiscal 2009, we expect net sales to be in line with first quarter net sales, to incur a smaller overall loss and to maintain a strong balance sheet. If current economic conditions continue, we expect continued pressure on our customers, vendors and ourselves, as well as our competitors. We believe we are well positioned to respond appropriately to current economic conditions and capitalize on changing economic conditions because of our cash reserves, excellent manufacturing facilities, good customer relationships and industry standing."
NAI, headquartered in San Marcos, California, is a leading formulator, manufacturer and marketer of nutritional supplements and provides strategic partnering services to its customers. Our comprehensive partnership approach offers a wide range of innovative nutritional products and services to our clients including: scientific research, clinical studies, proprietary ingredients, customer-specific nutritional product formulation, product testing and evaluation, marketing management and support, packaging and delivery system design, regulatory review and international product registration assistance. For more information about NAI, please see our website at http://www.nai-online.com.
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 that are not historical facts and information. These statements represent our intentions, expectations and beliefs concerning future events, including, among other things, our expectations and beliefs with respect to our future financial and operating results, including the amount of our future revenue and profits and our future financial condition, and our ability to reduce operating costs, expand our contract manufacturing business, and develop, maintain or increase sales to new and existing customers, as well as future economic conditions and the impact of such conditions on our business. We wish to caution readers these statements involve risks and uncertainties that could cause actual results and outcomes for future periods to differ materially from any forward-looking statement or views expressed herein. NAI's financial performance and the forward-looking statements contained herein are further qualified by other risks including those set forth from time to time in the documents filed by us with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q.
CONTACT - Kenneth Wolf, Chief Financial Officer, Natural Alternatives International, Inc., at 760-736-7700 or investor@nai-online.com.
Web site: http://www.nai-online.com
NATURAL ALTERNATIVES INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
September 30, June 30,
2008 2008
-------------- --------------
ASSETS
Cash and cash equivalents $3,066 $3,518
Certificate of deposit 699 -
Accounts receivable, net 3,881 6,401
Inventories, net 15,842 14,135
Income tax receivable 2,189 1,354
Current assets of discontinued operations 2,908 6,379
Other current assets 1,941 1,969
-------------- --------------
Total current assets 30,526 33,756
Property and equipment, net 13,566 12,823
Other noncurrent assets, net 431 431
-------------- --------------
Total Assets $44,523 $47,010
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued liabilities $9,377 $10,034
Line of credit 595 -
Current portion of long-term debt 2,363 2,730
Current liabilities of discontinued operations 2,121 2,882
Deferred rent 1,139 1,164
Long-term pension liability 211 198
-------------- --------------
Total Liabilities 15,806 17,008
Stockholders' Equity 28,717 30,002
-------------- --------------
Total Liabilities and Stockholders'
Equity $44,523 $47,010
============== ==============
NATURAL ALTERNATIVES INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended
September 30,
------------------------------
2008 2007
--------- ---------
NET SALES $19,526 100.0% $22,885 100.0%
Cost of goods sold 17,126 87.7% 18,945 82.8%
--------- -------- --------- --------
Gross profit 2,400 12.3% 3,940 17.2%
Selling, general & administrative
expenses 2,618 13.4% 2,892 12.6%
--------- ---------
OPERATING (LOSS) INCOME FROM
CONTINUING OPERATIONS (218) -1.1% 1,048 4.6%
Other expense, net 313 1.6% 11 0.0%
--------- -------- --------- --------
(LOSS) INCOME FROM CONTINUING
OPERATIONS BEFORE TAXES (531) -2.7% 1,037 4.5%
(Benefit) provision for income
taxes (182) 286
--------- ---------
(LOSS) INCOME FROM CONTINUING
OPERATIONS (349) -1.8% 751 3.3%
LOSS FROM DISCONTINUED
OPERATIONS, NET OF TAX (1,048) -5.4% (328) -1.4%
--------- ---------
NET (LOSS) INCOME $(1,397) $423
========= =========
NET INCOME (LOSS) PER COMMON SHARE:
Basic:
Continuing Operations ($0.05) $0.11
Discontinued Operations ($0.15) ($0.05)
--------- ---------
Net (Loss) Income ($0.20) $0.06
========= =========
Diluted:
Continuing Operations ($0.05) $0.11
Discontinued Operations ($0.15) ($0.05)
--------- ---------
Net (Loss) Income ($0.20) $0.06
========= =========
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING:
Basic 7,033 6,914
========= =========
Diluted 7,033 7,022
========= =========
SOURCE Natural Alternatives International, Inc.
CONTACT: Kenneth Wolf, Chief Financial Officer of Natural Alternatives
International, Inc., +1-760-736-7700, investor@nai-online.com
Web site: http://www.nai-online.com