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Nutraceutical Reports Fiscal 2012 Year End Results

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PARK CITY, Utah, Nov. 20, 2012 /PRNewswire/ -- Nutraceutical International Corporation (NASDAQ:   NUTR) today reported results for the fiscal 2012 fourth quarter ended September 30, 2012.  Net sales for the fiscal 2012 fourth quarter were $50.3 million compared to $45.8 million for the same quarter of fiscal 2011.  For the fourth quarter of fiscal 2012, net income was $4.2 million, or $0.42 diluted earnings per share, compared to net income of $3.3 million, or $0.32 diluted earnings per share, for the same quarter of fiscal 2011. 

Net sales for the fiscal year ended September 30, 2012 were $200.4 million compared to $188.1 million for the same period in fiscal 2011.  For the fiscal year ended September 30, 2012, net income was $15.8 million, or $1.59 diluted earnings per share, compared to net income of $15.7 million, or $1.51 diluted earnings per share, for the same period of fiscal 2011.  Net income for the fiscal year ended September 30, 2012 included a non-cash intangible asset impairment charge of $0.6 million, net of tax, or $0.06 per diluted share, related to the consolidation of our Alan James Group™ brand into our Body Gold® brand.  The charge represented the entire carrying amount of the Alan James Group™ brand.  We believe this brand consolidation provides increased operational efficiencies and synergies and will enhance certain customer relationships.     

Operating cash flow for the fiscal year ended September 30, 2012 was $27.2 million compared to $26.3 million for the same period of fiscal 2011.  The fiscal 2012 operating cash flow was primarily used to invest $12.2 million in acquisitions of natural product businesses, $10.0 million in purchases of property, plant and equipment and $5.6 million in repurchases of common stock. 

Bill Gay, chairman and chief executive officer, commented, "Our fiscal 2012 annual net sales reached $200 million.  Fiscal 2012 net sales growth of 6.5% resulted primarily from acquisitions and increased branded domestic sales.  Net sales from our international markets continued to be soft throughout the year.  Adjusted EBITDA grew to over $35 million for the fiscal year.  Substantial progress has been made in maximizing utilization of our manufacturing facilities but we believe that more synergies are possible in fiscal 2013. We will continue to focus on raw material cost savings, labor expense management and consolidating our marketing and sales infrastructure."

Mr. Gay stated, "The Health and Natural Foods Markets that we serve appear to remain strong with ongoing expansions at many chain stores in spite of challenges in other retail segments and in national and international markets.  We will continue to make acquisitions that complement our current brands and product offerings.  All in all, we believe it was a very good year when one considers that we were confronted by increasingly difficult economic headwinds. We remain optimistic but cautious as we approach next year.  Our investors, management and employees are very much appreciated."

ABOUT NUTRACEUTICAL
We are an integrated manufacturer, marketer, distributor and retailer of branded nutritional supplements and other natural products sold primarily to and through domestic health and natural food stores.  Internationally, we market and distribute branded nutritional supplements and other natural products to and through health and natural product distributors and retailers.  Our core business strategy is to acquire, integrate and operate businesses in the natural products industry that manufacture, market and distribute branded nutritional supplements.  We believe that the consolidation and integration of these acquired businesses provides ongoing financial synergies through increased scale and market penetration, as well as strengthened customer relationships.

We manufacture and sell nutritional supplements and other natural products under numerous brands including Solaray®, KAL®, Nature's Life®, LifeTime®, Natural Balance®, bioAllers®, Herbs for Kids™, NaturalCare®, Health from the Sun®, Life-flo®, Organix South®, Pioneer® and Monarch Nutraceuticals™. 

We own neighborhood natural food markets, which operate under the trade names The Real Food Company™, Thom's Natural Foods™ and Cornucopia Community Market™.  We also own health food stores, which operate under the trade names Fresh Vitamins™, Granola's™, Nature's Discount™ and Warehouse Vitamins™.

We manufacture and/or distribute one of the broadest branded product lines in the industry with over 7,000 SKUs, including approximately 900 SKUs sold internationally.  We believe that as a result of our emphasis on innovation, quality, loyalty, education and customer service, our brands are widely recognized in health and natural food stores and among their customers.

This Press Release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to our financial condition, results of operations and business. These forward-looking statements can be identified by the use of terms such as "believe," "expects," "plan," "intend," "may," "will," "should," "can," or "anticipates," or the negative thereof, or variations thereon, or comparable terminology, or by discussions of strategy. These statements involve known and unknown risks, uncertainties and other factors that may cause industry trends or our actual results to be materially different from any future results expressed or implied by these statements.  Important factors that may cause our results to differ from these forward-looking statements include, but are not limited to: (i) changes in or new government regulations or increased enforcement of the same, (ii) unavailability of desirable acquisitions or inability to complete them, (iii) increased costs, including from increased raw material or energy prices, (iv) changes in general worldwide economic or political conditions, (v) adverse publicity or negative consumer perception regarding nutritional supplements, (vi) issues with obtaining raw materials of adequate quality or quantity, (vii) litigation and claims, including product liability, intellectual property and other types,  (viii) disruptions from or following acquisitions including the loss of customers, (ix) increased competition, (x) slow or negative growth in the nutritional supplement industry or the healthy foods channel, (xi) the loss of key personnel or the inability to manage our operations efficiently, (xii) problems with information management systems, manufacturing efficiencies and operations, (xiii) insurance coverage issues, (xiv) the volatility of the stock market generally and of our stock specifically, (xv) increases in the cost of borrowings or unavailability of additional debt or equity capital, or both, or fluctuations in foreign currencies, and (xvi) interruption of business or negative impact on sales and earnings due to acts of God, acts of war, terrorism, bio-terrorism, civil unrest and other factors outside of our control.  Copies of our SEC reports are available upon request from our investor relations department or may be obtained at the SEC's website (www.sec.gov).

© 2012 Nutraceutical Corporation.  All rights reserved.

 

 

NUTRACEUTICAL INTERNATIONAL CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited; dollars in thousands)
















 September 30, 


 September 30, 




2012


2011

Assets





     Current assets, net

$         68,268


$         62,069

     Property, plant and equipment, net

75,454


72,094

     Goodwill

14,752


8,853

     Other non-current assets, net

27,444


28,649




$       185,918


$       171,665







Liabilities and Stockholders' Equity




     Current liabilities

$         20,670


$         19,737

     Long-term liabilities

34,192


32,253

     Stockholders' equity  

131,056


119,675




$       185,918


$       171,665

 

 

 

NUTRACEUTICAL INTERNATIONAL CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited; dollars in thousands, except per share data)
























Three months ended September 30,


Twelve months ended September 30,




2012


2011


2012


2011

Net sales

$    50,261


$      45,825


$  200,367


$    188,070

Cost of sales

25,282


23,415


100,413


92,877



Gross profit

24,979


22,410


99,954


95,193

Operating expenses










Selling, general and administrative

17,642


16,907


71,425


68,230



Amortization of intangible assets

569


441


2,007


1,654



Impairment of intangible asset

-


-


850


-

Income from operations

6,768


5,062


25,672


25,309

Interest and other expense, net

373


338


1,497


1,140

Income before provision for income taxes

6,395


4,724


24,175


24,169

Provision for income taxes

2,221


1,450


8,408


8,451











Net income

$      4,174


$        3,274


$    15,767


$      15,718





















Net income per common share










Basic

$        0.42


$          0.32


$        1.59


$          1.52



Diluted

0.42


0.32


1.59


1.51











Weighted average common shares outstanding










Basic

9,832,432


10,237,218


9,916,603


10,322,177



Diluted

9,856,305


10,289,748


9,933,997


10,385,583

 

 

 

NUTRACEUTICAL INTERNATIONAL CORPORATION

ADJUSTED EBITDA SCHEDULE

(unaudited; dollars in thousands)
























Three months ended September 30,


Twelve months ended September 30,




2012


2011


2012


2011











Net income

$ 4,174


$ 3,274


$ 15,767


$ 15,718

Provision for income taxes

2,221


1,450


8,408


8,451

Interest and other expense, net (1)

373


338


1,497


1,140

Depreciation and amortization 

2,366


2,054


8,777


8,052

Impairment of intangible asset (2)

-


-


850


-











Adjusted EBITDA

$ 9,134


$ 7,116


$ 35,299


$ 33,361
































(1)

Includes amortization of deferred financing fees. 











(2)

A non-cash intangible asset impairment charge of $850 related to the consolidation of the Alan James Group™ brand into the Body Gold® brand was recorded for the twelve months ended September 30, 2012.





















Non-GAAP Financial Measures

     Adjusted EBITDA (a non-GAAP measure) is defined in our debt covenants and performance measures as earnings before net interest and other expense, taxes, depreciation, amortization and intangible asset impairment.  We believe that Adjusted EBITDA provides useful additional information to analysts, creditors, investment bankers and management regarding operating performance and debt covenant compliance.  Adjusted EBITDA has some inherent limitations in measuring operating performance due to the exclusion of certain financial elements such as depreciation and amortization and is not necessarily comparable to other similarly-titled captions of other companies due to potential inconsistencies in the method of calculation.  Furthermore, Adjusted EBITDA is not intended to be an alternative to net income in determining our operating performance in accordance with generally accepted accounting principles.

 

SOURCE Nutraceutical International Corporation



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