Nutraceutical Reports Fiscal 2011 Q2 Results

PARK CITY, Utah, April 28, 2011 /PRNewswire/ -- Nutraceutical International Corporation (NASDAQ: NUTR) today reported results for the fiscal 2011 second quarter ended March 31, 2011.  Net sales for the fiscal 2011 second quarter were $49.5 million compared to $47.9 million for the same quarter of fiscal 2010.  For the second quarter of fiscal 2011, net income was $4.6 million, or $0.44 diluted earnings per share, compared to net income of $5.1 million, or $0.49 diluted earnings per share, for the same quarter of fiscal 2010.

Net sales for the six months ended March 31, 2011 were $94.8 million compared to $92.7 million for the same period in fiscal 2010.  For the six months ended March 31, 2011, net income was $8.5 million, or $0.81 per diluted share, compared to net income of $9.0 million, or $0.86 per diluted share, for the same period of fiscal 2010.  

Operating cash flow for the six months ended March 31, 2011 was $15.7 million compared to $11.0 million for the same period of fiscal 2010.  This operating cash flow was primarily used to invest $7.4 million in acquisitions of branded natural product businesses, $3.4 million in purchases of property and equipment, $1.9 million in repurchases of common stock and $1.0 million to repay net borrowings on the Company's revolving credit facility.  

Bill Gay, chairman and chief executive officer, commented, "Our fiscal 2011 second quarter net sales growth was primarily attributable to acquisitions completed during the previous twelve months.  Net income, cash flow and EBITDA remained strong but were impacted slightly by the consolidation and relocation costs of acquired businesses.  The health and natural foods retail market remains solid although competitive regarding promotions and incentives.  Individual and chain retail success appears mixed as many stores continue to encounter the headwinds of a sluggish economic environment."

Mr. Gay continued, "We continue to repurchase our stock in the open market at what we believe are favorable multiples, invest internally in operational labor-saving improvements and actively pursue potential acquisitions.  The refitting and expansion of our recently acquired liquid manufacturing facility is estimated to take another nine months.  We have already relocated the manufacturing operations of two recent acquisitions to this facility and will move a couple of other lines during our third quarter.  We continue to focus on identifying acquisitions that enable us to leverage our facilities, utilize our national sales assets and distribution capabilities as well as provide innovative products we don't currently sell.  Management appreciates the ongoing support from our investors and employees in growing our company."  

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™ and Granola's™.

We manufacture and/or distribute one of the broadest branded product lines in the industry with over 5,500 SKUs, including over 700 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).

© 2011 Nutraceutical Corporation.  All rights reserved.

SOURCE Nutraceutical International Corporation