EX-99.1 2 a08-12927_1ex99d1.htm EX-99.1

 

Exhibit 99.1

 

 

FOR IMMEDIATE RELEASE

Contact: Harvey Kamil

 

Carl Hymans

NBTY, Inc.

 

G.S. Schwartz & Co.

President and Chief Financial Officer

 

212-725-4500

631-200-2020

 

carlh@schwartz.com

 

 

NBTY REPORTS SECOND QUARTER RESULTS

 

RONKONKOMA, N.Y. — April 24, 2008 - NBTY, Inc. (NYSE: NTY) (www.NBTY.com), a leading global manufacturer and marketer of nutritional supplements, today announced results for the fiscal second quarter and first six months ended March 31, 2008.

 

For the fiscal second quarter ended March 31, 2008, net sales were $533 million compared to $508 million for the fiscal second quarter ended March 31, 2007, an increase of $24 million or 5%.

 

Net income for the fiscal second quarter ended March 31, 2008 was $44 million, or $0.67 per diluted share, compared to $57 million, or $0.83 per diluted share, for the fiscal second quarter ended March 31, 2007.  The decrease in net income reflects the decrease in overall gross profit from 53% to 51% and higher advertising and selling, general and administrative costs incurred in the fiscal second quarter.

 

Adjusted EBITDA for the fiscal second quarter ended March 31, 2008 was $84 million compared to $100 million for the prior like quarter.  At March 31, 2008, NBTY had total assets of $1.5 billion and working capital of $494 million.  The Company is committed to using its cash and leverage to increase shareholder value through investments in infrastructure, opportunistic acquisitions and stock repurchases.   During the quarter, $8 million in short term municipal auction rate securities were reclassified into Other Assets to reflect the lack of liquidity.

 

Net sales for the six months ended March 31, 2008 increased 3% to $1.043 billion.

 

 

 



 

 

Net income for the six months ended March 31, 2008 was $90 million, or $1.34 per diluted share, compared to $108 million, or $1.56 per diluted share, for the six months ended March 31, 2007.  The decrease in net income reflects higher advertising and SG&A costs.

 

Adjusted EBITDA for the six months ended March 31, 2008 was $171 million compared to $196 million for the six months ended March 31, 2007.

 

In fiscal year 2008, NBTY repurchased a total of 6.1 million shares of its common stock under an existing publicly announced share repurchase program.  The Company repurchased

 

296 thousand shares in October 2007 for approximately $11 million and 5.8 million shares were repurchased in February 2008 for $160 million.

 

Accordingly, the number of weighted average diluted shares for the quarter ended March 31, 2008 was 66 million and is expected to decline in future quarters to approximately 63 million when reflecting the full impact of the stock repurchase.

 

OPERATIONS FOR THE FISCAL SECOND QUARTER ENDED MARCH 31, 2008

 

Net sales for the Wholesale/US Nutrition division, which markets Nature’s Bounty, Solgar, Osteo Bi-Flex, Rexall, Ester-C and other brands, increased $14 million or 6% to $259 million from $245 million for the prior like quarter.  Gross profit for the Wholesale operation was 41%, compared to 43% for the prior like quarter.  The decrease in gross profit reflects changes in product mix and more promotional programs offered to customers.  This division continues to gain market share.  Information Resources Inc. (IRI) tracks industry-wide sales in the food, drug and mass market sectors.  For the thirteen week period ended March 30, 2008, IRI reported an increase in the category of 7%.  According to IRI, for the same period, the Company’s Wholesale division reported a 23% increase.  The Company is encouraged by this increase.

 

The Wholesale/US Nutrition division utilizes valuable consumer preference sales data generated by the Company’s Vitamin World retail stores and Puritan’s Pride Direct Response/E-Commerce operations to empower its wholesale customers with this latest data.  The Vitamin World stores are used as a laboratory for new ideas and are an effective tool in

 

 

 

2



 

 

determining and monitoring consumer preferences.  This information, as well as scanned sales data from the Vitamin World stores, is shared on a real time basis with our wholesale customers to give them a competitive advantage.

 

Net sales for the North American Retail division were $52 million for the fiscal second quarter ended March 31, 2008 compared with $56 million for the prior like quarter.  The North American Retail division and Vitamin World were profitable, although LeNaturiste, the Company’s Canadian retail chain, operated at a loss.

 

Same store sales for North American Retail decreased 4% for the fiscal second quarter of 2008.  The North American Retail division continues to focus on rationalizing SKUs, enhancing visual merchandising and increasing customer traffic.  During the fiscal second quarter of 2008, the North American Retail division closed 7 under-performing stores and added 3 new stores. At the end of the fiscal second quarter, the North American Retail division operated a total of 530 stores consisting of 450 Vitamin World stores in the United States and 80 LeNaturiste stores in Canada.  During the remainder of fiscal 2008, North American Retail anticipates opening 7 stores and closing 7 under-performing stores.

 

European Retail net sales for the fiscal second quarter of 2008 were $158 million compared to $160 million for the prior like period.  European Retail division same store sales in local currency decreased 4% reflecting the continued difficult retail environment.  The European Retail division consists of 516 Holland & Barrett and 31 GNC stores in the UK, 19 Nature’s Way stores in Ireland, and 70 DeTuinen stores in the Netherlands for a total of 636 stores.  During the fiscal second quarter of 2008 the European Retail division opened 2 stores.  During the remainder of fiscal 2008, the European Retail division anticipates opening 19 additional stores.  The European Retail division continues to leverage its premier status, high street locations and brand awareness in a difficult retail environment.

 

Net sales from Direct Response/E-Commerce operations for the fiscal second quarter of 2008 increased $15 million, or 31% to $63 million from $48 million for the fiscal second quarter of 2007.  This division varies its promotional strategy throughout the fiscal year, utilizing highly promotional priced catalogs which are not offered in every quarter.  Direct

 

 

 

 

3



 

 

Response’s historical results reflect this pattern and should therefore be viewed on an annual and not quarterly basis.

 

The Direct Response operations include catalog and online internet sales.  This division’s strategic plan is to increase internet sales by continuing to incorporate new technologies.  For this fiscal second quarter online sales increased to 45% of total Direct Response/E-Commerce sales compared to 36% for the fiscal second quarter of 2007.  For the six months ended March 31, 2008, this division processed 1.4 million orders, an increase of over 250 thousand orders compared to the prior like period.  NBTY remains the leader in the direct response and e-commerce sectors and continues to increase the number of products available via its catalog and web sites.

 

NBTY Chairman and CEO, Scott Rudolph, said:  “Our continued sales momentum is indicative of NBTY’s ability to develop and implement strategic initiatives to enhance our dominant position as the worldwide leader in the nutritional supplement industry.  We continue to make investments in our infrastructure and remain well positioned to quickly adapt to meet the challenges of industry segment changes and remain committed to increasing long-term profitability and shareholder value.

 

ABOUT NBTY

 

NBTY is a leading global vertically integrated manufacturer, marketer and distributor of a broad line of high-quality, value-priced nutritional supplements in the United States and throughout the world. Under a number of NBTY and third party brands, the Company offers over 22,000 products, including products marketed by the Company’s Nature’s Bounty® (www.NaturesBounty.com), Vitamin World® (www.VitaminWorld.com), Puritan’s Pride® (www.Puritan.com), Holland & Barrett® (www.HollandAndBarrett.com), Rexall® (www.Rexall.com), Sundown® (www.SundownNutrition.com), MET-Rx® (www.MetRX.com), Worldwide Sport Nutrition® (www.SportNutrition.com), American Health® (www.AmericanHealthUS.com), GNC (UK)® (www.GNC.co.uk), DeTuinen® (www.DeTuinen.nl), LeNaturiste™ (www.LeNaturiste.com), SISU® (www.SISU.com), Solgar® (www.Solgar.com), Good ‘n’ Natural® (www.goodnnatural.com), Home Health™ (www.homehealthus.com) and Ester-C® (www.Ester-C.com) brands.

 

This release refers to non-GAAP financial measures, such as Adjusted EBITDA.  “Adjusted EBITDA” is defined as net income, excluding the aggregate amount of all non-cash losses reducing net income, plus interest, taxes, depreciation and amortization.  This non-GAAP financial measure is not prepared in accordance with generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.  A reconciliation of the non-GAAP measure to the comparable GAAP measure is included in the attached financial tables.  Management believes the presentation of Adjusted EBITDA is relevant and useful because Adjusted EBITDA is a measurement industry analysts utilize when evaluating NBTY’s operating performance.  Management also believes Adjusted

 

 

 

 

4



 

 

EBITDA enhances an investor’s understanding of NBTY’s results of operations because it measures NBTY’s operating performance exclusive of interest and non-cash charges for depreciation and amortization.  Management also provides this non-GAAP measurement as a way to help investors better understand its core operating performance, enhance comparisons of NBTY’s core operating performance from period to period and to allow better comparisons of NBTY’s operating performance to that of its competitors.

 

This release contains certain 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 terminology such as “subject to,” “believe,” “expects,” “plan,” “project,” “estimate,” “intend,” “may,” “will,” “should,” “can,” or “anticipates,” or the negative thereof, or variations thereon, or comparable terminology, or by discussions of strategy.   Although all of these forward looking statements are believed to be reasonable, they are inherently uncertain.  Factors which may materially affect such forward-looking statements include: (i) slow or negative growth in the nutritional supplement industry; (ii) interruption of business or negative impact on sales and earnings due to acts of God, acts of war, terrorism, bio-terrorism, civil unrest or disruption of mail service; (iii) adverse publicity regarding nutritional supplements; (iv) inability to retain customers of companies (or mailing lists) recently acquired; (v) increased competition; (vi) increased costs; (vii) loss or retirement of key members of management; (viii) increases in the cost of borrowings and/or unavailability of additional debt or equity capital; (ix) unavailability of, or inability to consummate, advantageous acquisitions in the future, including those that may be subject to bankruptcy approval or the inability of NBTY to integrate acquisitions into the mainstream of its business; (x) changes in general worldwide economic and political conditions in the markets in which NBTY may compete from time to time; (xi) the inability of NBTY to gain and/or hold market share of its wholesale and/or retail customers anywhere in the world; (xii) unavailability of electricity in certain geographical areas; (xiii) the inability of NBTY to obtain and/or renew insurance and/or the costs of the same; (xiv) exposure to and expense of defending and resolving product liability and intellectual property claims and other litigation; (xv) the ability of NBTY to successfully implement its business strategy; (xvi) the inability of NBTY to manage its retail, wholesale, manufacturing and other operations efficiently; (xvii) consumer acceptance of NBTY’s products; (xviii) the inability of NBTY to renew leases for its retail locations; (xix) the inability of NBTY’s retail stores to attain or maintain profitability; (xx) the absence of clinical trials for many of NBTY’s products; (xxi) sales and earnings volatility and/or trends for the Company and its market segments; (xxii) the efficacy of NBTY’s Internet and on-line sales and marketing strategies; (xxiii) fluctuations in foreign currencies, including the British pound, the Euro and the Canadian dollar; (xxiv) import-export controls on sales to foreign countries; (xxv) the inability of NBTY to secure favorable new sites for, and delays in opening, new retail and manufacturing locations; (xxvi) introduction of and compliance with new federal, state, local or foreign legislation or regulation or adverse determinations by regulators anywhere in the world (including the banning of products) and more particularly Good Manufacturing Practices in the United States, the Food Supplements Directive and Traditional Herbal Medicinal Products Directive in Europe and Section 404 requirements of the Sarbanes-Oxley Act of 2002; (xxvii) the mix of NBTY’s products and the profit margins thereon; (xxviii) the availability and pricing of raw materials; (xxix) risk factors discussed in NBTY’s filings with the U.S. Securities and Exchange Commission; (xxx) adverse effects on NBTY as a result of increased energy prices and potentially reduced traffic flow to NBTY’s retail locations; (xxxi) adverse tax determinations; (xxxii) the loss of a significant customer of the Company; (xxxiii) potential investment losses as a result of liquidity conditions; and (xxxiv) other factors beyond the Company’s control.

 

Readers are cautioned not to place undue reliance on forward-looking statements. NBTY cannot guarantee future results, trends, events, levels of activity, performance or achievements. NBTY does not undertake and specifically declines any obligation to update, republish or revise forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrences of unanticipated events.

 

Consequently, such forward-looking statements should be regarded solely as NBTY’s current plans, estimates and beliefs.

 

 

 

 

 

5



 

(TABLES FOLLOW)

 

 

NBTY, Inc.

Condensed Consolidated Statements of Income

 

(Unaudited)

 

(In thousands, except per share amounts)

 

 

 

For the three months
ended March 31,

 

 

 

2008

 

2007

 

 

 

 

 

 

 

Net sales

 

$

532,518

 

$

508,459

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

Cost of sales

 

261,284

 

239,530

 

Advertising, promotion and catalog

 

39,007

 

34,441

 

Selling, general and administrative

 

166,409

 

151,963

 

 

 

466,700

 

425,934

 

 

 

 

 

 

 

Income from operations

 

65,818

 

82,525

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

Interest

 

(3,657

)

(4,154

)

Miscellaneous, net

 

3,786

 

2,307

 

 

 

129

 

(1,847

)

 

 

 

 

 

 

Income before provision for income taxes

 

65,947

 

80,678

 

 

 

 

 

 

 

Provision for income taxes

 

21,721

 

23,324

 

 

 

 

 

 

 

Net income

 

$

44,226

 

$

57,354

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

Basic

 

$

0.69

 

$

0.85

 

Diluted

 

$

0.67

 

$

0.83

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

Basic

 

64,102

 

67,273

 

Diluted

 

65,817

 

69,490

 

 

 

 



 

 

NBTY, Inc.

Condensed Consolidated Statements of Income

(Unaudited)

 

(In thousands, except per share amounts)

 

 

 

For the six months
ended March 31,

 

 

 

2008

 

2007

 

 

 

 

 

 

 

Net sales

 

$

1,043,376

 

$

1,014,697

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

Cost of sales

 

501,615

 

486,578

 

Advertising, promotion and catalog

 

73,176

 

61,204

 

Selling, general and administrative

 

334,531

 

303,902

 

 

 

909,322

 

851,684

 

 

 

 

 

 

 

Income from operations

 

134,054

 

163,013

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

Interest

 

(7,519

)

(9,217

)

Miscellaneous, net

 

8,673

 

3,646

 

 

 

1,154

 

(5,571

)

 

 

 

 

 

 

Income before provision for income taxes

 

135,208

 

157,442

 

 

 

 

 

 

 

Provision for income taxes

 

45,160

 

49,232

 

 

 

 

 

 

 

Net income

 

$

90,048

 

$

108,210

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

Basic

 

$

1.37

 

$

1.61

 

Diluted

 

$

1.34

 

$

1.56

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

Basic

 

65,510

 

67,242

 

Diluted

 

67,313

 

69,423

 

 

 

 



 

 

 

SALES

 

 

 

(Unaudited)

 

 

 

THREE MONTHS ENDED
MARCH 31,

 

 

 

 

 

 

 

Percentage

 

(In thousands)

 

2008

 

2007

 

Change

 

 

 

 

 

 

 

 

 

Wholesale / US Nutrition

 

$

259,363

 

$

244,968

 

6

%

 

 

 

 

 

 

 

 

North American Retail

 

51,904

 

55,764

 

-7

%

 

 

 

 

 

 

 

 

European Retail

 

158,070

 

159,554

 

-1

%

 

 

 

 

 

 

 

 

Direct Response / E-Commerce

 

63,181

 

48,173

 

31

%

 

 

 

 

 

 

 

 

Total

 

$

532,518

 

$

508,459

 

5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GROSS PROFIT

 

 

 

PERCENTAGES

 

 

 

(Unaudited)

 

 

 

THREE MONTHS ENDED
MARCH 31,

 

 

 

 

 

 

 

Increase

 

 

 

2008

 

2007

 

- Decrease

 

 

 

 

 

 

 

 

 

Wholesale / US Nutrition

 

41

%

43

%

-2

%

 

 

 

 

 

 

 

 

North American Retail

 

62

%

60

%

2

%

 

 

 

 

 

 

 

 

European Retail

 

61

%

64

%

-3

%

 

 

 

 

 

 

 

 

Direct Response / E-Commerce

 

59

%

61

%

-2

%

 

 

 

 

 

 

 

 

Total

 

51

%

53

%

-2

%

 

 

 



 




 

SALES

 

 

 

(Unaudited)

 

 

 

SIX MONTHS ENDED
MARCH 31,

 

 

 

 

 

 

 

Percentage

 

(In thousands)

 

2008

 

2007

 

Change

 

 

 

 

 

 

 

 

 

Wholesale / US Nutrition

 

$

518,298

 

$

491,697

 

5

%

 

 

 

 

 

 

 

 

North American Retail

 

108,086

 

110,737

 

-2

%

 

 

 

 

 

 

 

 

European Retail

 

316,666

 

312,520

 

1

%

 

 

 

 

 

 

 

 

Direct Response / E-Commerce

 

100,326

 

99,743

 

1

%

 

 

 

 

 

 

 

 

Total

 

$

1,043,376

 

$

1,014,697

 

3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GROSS PROFIT

 

 

 

PERCENTAGES

 

 

 

(Unaudited)

 

 

 

SIX MONTHS ENDED
MARCH 31,

 

 

 

 

 

 

 

Increase

 

 

 

2008

 

2007

 

- Decrease

 

 

 

 

 

 

 

 

 

Wholesale / US Nutrition

 

42

%

41

%

1

%

 

 

 

 

 

 

 

 

North American Retail

 

60

%

60

%

0

%

 

 

 

 

 

 

 

 

European Retail

 

62

%

64

%

-2

%

 

 

 

 

 

 

 

 

Direct Response / E-Commerce

 

60

%

61

%

-1

%

 

 

 

 

 

 

 

 

Total

 

52

%

52

%

0

%

 

 

 

 

 



 

 

ADJUSTED EBITDA**

Reconciliation of GAAP Measures to Non-GAAP Measures

(Unaudited)

 

(In thousands)

 

 

 

THREE MONTHS ENDED
MARCH 31, 2008

 

 

 

Pretax Income
(Loss)

 

Depreciation and
amortization

 

Interest

 

Non-cash
charges

 

Adjusted
EBITDA**

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale / US Nutrition

 

$

41,507

 

$

2,578

 

$

 

$

48

 

$

44,133

 

 

 

 

 

 

 

 

 

 

 

 

 

North American Retail

 

522

 

804

 

 

16

 

1,342

 

 

 

 

 

 

 

 

 

 

 

 

 

European Retail

 

34,266

 

2,970

 

 

41

 

37,277

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct Response / E-Commerce

 

15,750

 

1,374

 

 

20

 

17,144

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Results

 

92,045

 

7,726

 

 

125

 

99,896

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate / Manufacturing

 

(26,098

)

5,998

 

3,657

 

393

 

(16,050

)

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

65,947

 

$

13,724

 

$

3,657

 

$

518

 

$

83,846

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

THREE MONTHS ENDED
MARCH 31, 2007

 

 

 

Pretax Income
(Loss)

 

Depreciation and
amortization

 

Interest

 

Non-cash
charges

 

Adjusted
EBITDA**

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale / US Nutrition

 

$

48,748

 

$

2,770

 

$

 

$

 

$

51,518

 

 

 

 

 

 

 

 

 

 

 

 

 

North American Retail

 

984

 

997

 

 

231

 

2,212

 

 

 

 

 

 

 

 

 

 

 

 

 

European Retail

 

43,705

 

2,737

 

 

 

46,442

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct Response / E-Commerce

 

12,498

 

1,263

 

 

 

13,761

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Results

 

105,935

 

7,767

 

 

231

 

113,933

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate / Manufacturing

 

(25,257

)

6,747

 

4,154

 

 

(14,356

)

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

80,678

 

$

14,514

 

$

4,154

 

$

231

 

$

99,577

 

 

 


**   SINCE ADJUSTED EBITDA IS NOT A MEASURE OF PERFORMANCE CALCULATED IN ACCORDANCE WITH U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (“GAAP”), IT SHOULD NOT BE CONSIDERED IN ISOLATION OF, OR AS A SUBSTITUTE FOR OR SUPERIOR TO, OTHER MEASURES OF FINANCIAL PERFORMANCE PREPARED IN ACCORDANCE WITH GAAP, SUCH AS OPERATING INCOME, NET INCOME AND CASH FLOWS FROM OPERATING ACTIVITIES.  IN ADDITION, THE COMPANY’S DEFINITION OF ADJUSTED EBITDA IS NOT NECESSARILY COMPARABLE TO SIMILARLY TITLED MEASURES REPORTED BY OTHER COMPANIES.

 

 

 

 



 

 

ADJUSTED EBITDA**

Reconciliation of GAAP Measures to Non-GAAP Measures

(Unaudited)

 

(In thousands)

 

 

 

SIX MONTHS ENDED
MARCH 31, 2008

 

 

 

Pretax Income
(Loss)

 

Depreciation and
amortization

 

Interest

 

Non-cash
charges

 

Adjusted
EBITDA**

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale / US Nutrition

 

$

95,488

 

$

5,272

 

$

 

$

48

 

$

100,808

 

 

 

 

 

 

 

 

 

 

 

 

 

North American Retail

 

(342

)

1,654

 

 

366

 

1,678

 

 

 

 

 

 

 

 

 

 

 

 

 

European Retail

 

69,333

 

6,032

 

 

41

 

75,406

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct Response / E-Commerce

 

22,872

 

2,740

 

 

20

 

25,632

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Results

 

187,351

 

15,698

 

 

475

 

203,524

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate / Manufacturing

 

(52,143

)

11,957

 

7,519

 

393

 

(32,274

)

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

135,208

 

$

27,655

 

$

7,519

 

$

868

 

$

171,250

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SIX MONTHS ENDED
MARCH 31, 2007

 

 

 

Pretax Income
(Loss)

 

Depreciation and
amortization

 

Interest

 

Non-cash
charges

 

Adjusted
EBITDA**

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale / US Nutrition

 

$

98,337

 

$

5,559

 

$

 

$

 

$

103,896

 

 

 

 

 

 

 

 

 

 

 

 

 

North American Retail

 

2,071

 

2,134

 

 

584

 

4,789

 

 

 

 

 

 

 

 

 

 

 

 

 

European Retail

 

82,529

 

5,565

 

 

 

88,094

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct Response / E-Commerce

 

28,091

 

2,528

 

 

 

30,619

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Results

 

211,028

 

15,786

 

 

584

 

227,398

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate / Manufacturing

 

(53,586

)

12,960

 

9,217

 

 

(31,409

)

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

157,442

 

$

28,746

 

$

9,217

 

$

584

 

$

195,989

 

 

 


**   SINCE ADJUSTED EBITDA IS NOT A MEASURE OF PERFORMANCE CALCULATED IN ACCORDANCE WITH U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (“GAAP”), IT SHOULD NOT BE CONSIDERED IN ISOLATION OF, OR AS A SUBSTITUTE FOR OR SUPERIOR TO, OTHER MEASURES OF FINANCIAL PERFORMANCE PREPARED IN ACCORDANCE WITH GAAP, SUCH AS OPERATING INCOME, NET INCOME AND CASH FLOWS FROM OPERATING ACTIVITIES.  IN ADDITION, THE COMPANY’S DEFINITION OF ADJUSTED EBITDA IS NOT NECESSARILY COMPARABLE TO SIMILARLY TITLED MEASURES REPORTED BY OTHER COMPANIES.

 

 

 



 

NBTY, Inc.

Condensed Consolidated Balance Sheets

 

(Unaudited)

 

 

(Dollars and shares in thousands, except per share amounts)

 

 

 

March 31,
2008

 

September 30,
2007

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

104,908

 

$

92,902

 

Investments

 

24,991

 

121,382

 

Accounts receivable, net

 

99,725

 

98,454

 

Inventories

 

389,474

 

384,990

 

Deferred income taxes

 

21,855

 

21,441

 

Prepaid expenses and other current assets

 

49,291

 

54,460

 

 

 

 

 

 

 

Total current assets

 

690,244

 

773,629

 

 

 

 

 

 

 

Property, plant and equipment, net

 

321,555

 

323,154

 

Goodwill

 

249,811

 

251,753

 

Intangible assets, net

 

154,763

 

157,548

 

Other assets

 

36,674

 

28,851

 

 

 

 

 

 

 

Total assets

 

$

1,453,047

 

$

1,534,935

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Current portion of long-term debt

 

$

972

 

$

989

 

Accounts payable

 

86,363

 

71,852

 

Accrued expenses and other current liabilities

 

109,121

 

125,533

 

Total current liabilities

 

196,456

 

198,374

 

 

 

 

 

 

 

Long-term debt, net of current portion

 

209,164

 

210,106

 

Deferred income taxes

 

58,613

 

61,788

 

Other liabilities

 

11,802

 

8,697

 

Total liabilities

 

476,035

 

478,965

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

Common stock, $0.008 par; authorized 175,000 shares;

issued and outstanding 61,637 shares at
March 31, 2008 and 67,118 shares at September 30, 2007

 

493

 

537

 

Capital in excess of par

 

141,283

 

143,244

 

Retained earnings

 

792,226

 

864,852

 

Accumulated other comprehensive income

 

43,010

 

47,337

 

Total stockholders’ equity

 

977,012

 

1,055,970

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

1,453,047

 

$

1,534,935

 

 

 

 



 

 

NBTY, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 

(In thousands)

 

 

 

For the six months
ended March 31,

 

 

 

2008

 

2007

 

Cash flows from operating activities:

 

 

 

 

 

Net income

 

$

90,048

 

$

108,210

 

Adjustments to reconcile net income to cash provided by operating activities:

 

 

 

 

 

Impairments and disposals of property, plant and equipment

 

482

 

1,112

 

Depreciation and amortization

 

27,655

 

28,746

 

Foreign currency transaction (gain) loss

 

(1,385

)

212

 

Stock-based compensation

 

518

 

 

Amortization and write-off of deferred charges

 

372

 

1,515

 

Allowance for doubtful accounts

 

(174

)

(384

)

Inventory reserves

 

2,465

 

4,265

 

Deferred income taxes

 

903

 

7,385

 

Excess income tax benefit from exercise of stock options

 

(4,984

)

(1,884

)

Changes in operating assets and liabilities, net of acquisitions:

 

 

 

 

 

Accounts receivable

 

(153

)

(203

)

Inventories

 

(8,156

)

(19,623

)

Prepaid expenses and other current assets

 

4,849

 

10,967

 

Other assets

 

(608

)

(150

)

Accounts payable

 

13,927

 

6,807

 

Accrued expenses and other liabilities

 

(10,946

)

5,058

 

Net cash provided by operating activities

 

114,813

 

152,033

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

Purchase of property, plant and equipment

 

(21,693

)

(20,880

)

Purchase of available-for-sale investments

 

(159,884

)

(317,050

)

Proceeds from sale of available-for-sale investments

 

248,728

 

191,472

 

Cash paid for acquisitions, net of cash acquired

 

(5,072

)

(37,005

)

Cash collateral securing loan

 

 

(18,539

)

Net cash provided by (used in) investing activities

 

62,079

 

(202,002

)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

Principal payments under long-term debt agreements and capital leases

 

(481

)

(425

)

Payments for financing fees

 

 

(1,649

)

Excess income tax benefit from exercise of stock options

 

4,984

 

1,884

 

Proceeds from stock options exercised

 

3,852

 

634

 

Purchase of treasury stock (subsequently retired)

 

(171,008

)

 

Net cash (used in) provided by financing activities

 

(162,653

)

444

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

(2,233

)

1,957

 

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

12,006

 

(47,568

)

 

 

 

 

 

 

Cash and cash equivalents at beginning of the period

 

92,902

 

89,805

 

 

 

 

 

 

 

Cash and cash equivalents at end of the period

 

$

104,908

 

$

42,237