EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

LOGO

Natural Alternatives International, Inc.

Announces Fiscal 2008 Results

SAN MARCOS, CALIF, September 22, 2008 /PRNewswire/ —Natural Alternatives International, Inc. (“NAI”) (Nasdaq: NAII), a leading formulator, manufacturer and marketer of customized nutritional supplements, today announced a net loss of $371,000 or $0.05 per share for fiscal year 2008. These results included income from continuing operations of $912,000 or $0.13 per diluted share offset by a $1.3 million loss from discontinued operations or $0.18 per share. Net sales from continuing operations decreased by $4.8 million or 5.6% from $86.6 million in fiscal 2007 to $81.8 million in fiscal 2008.

For the fourth quarter of fiscal 2008 revenues from continuing operations increased slightly to $21.5 million from $21.4 million in the prior year period. This increase was primarily due to increased private label contract manufacturing sales partially offset by a decrease in our Dr. Cherry Pathway to Healing® product line sales. The net loss in the fourth quarter of fiscal 2008 was $168,000 or $0.02 per share compared to a net loss of $6.6 million or $0.96 per share in the prior year. The net loss in fiscal 2007 was primarily attributable to the $7.0 million non-cash goodwill impairment charge related to legacy RHL that was discontinued in the fourth quarter of fiscal 2008.

As of June 30, 2008, NAI had cash and working capital of $3.5 million and $18.1 million, respectively, compared to $4.1 million and $16.2 million, respectively, in the prior year. As of June 30, 2008, we had $7.5 million available under our working capital line of credit.

President Randell Weaver stated, “During the fourth quarter of fiscal 2008 in an effort to enhance stockholder value, improve working capital and enable us to focus on our core contract manufacturing businesses, we elected to narrow our branded products


focus and portfolio and developed a plan to sell some of our branded products assets. In addition, we have taken steps to significantly reduce our operating costs. While we expect our continuing operations to be profitable, we also expect to incur losses from discontinued operations in the first quarter of fiscal 2009 which are likely to exceed profits from continuing operations. Going forward, we believe focusing on our core private label contract manufacturing operations will significantly improve our overall profitability and allow us to better pursue our growth initiatives.”

CEO Mark LeDoux added, “Our balance sheet remains strong, and we believe the sale of selected assets will further strengthen our balance sheet. Obviously, in today’s economic climate, there are significant challenges. Our strong balance sheet and international scope should position us to meet these challenges effectively. We believe the steps we have taken will enable us to effectively capitalize on opportunities as we move forward.”

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 growth and financial and operating results, including the amount of our future revenue and profits and our future financial condition, our ability to implement our strategic plans, to enhance stockholder value, improve working capital and reduce operating costs, to grow our contract manufacturing business, to sell our branded products assets, and to develop, maintain or increase sales to new and existing customers. 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.

SOURCE - Natural Alternatives International, Inc.

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)

 

     June 30,
2008
   June 30,
2007
ASSETS      

Cash and cash equivalents

   $ 3,518    $ 4,095

Accounts receivable, net

     6,401      4,944

Inventories, net

     14,135      13,346

Income tax receivable

     1,354      546

Current assets of discontinued operations

     6,379      2,758

Other current assets

     1,969      2,195
             

Total current assets

     33,756      27,884

Property and equipment, net

     12,823      14,483

Other noncurrent assets, net

     431      169

Long-term assets of discontinued operations

     —        4,844
             

Total Assets

   $ 47,010    $ 47,380
             
LIABILITIES AND STOCKHOLDERS’ EQUITY      

Accounts payable and accrued liabilities

   $ 10,034    $ 8,413

Current portion of long-term debt

     2,730      1,825

Current liabilities of discontinued operations

     2,882      1,430

Deferred income taxes

     —        223

Deferred rent

     1,164      1,238

Long-term debt, less current portion

     —        2,756

Long-term pension liability

     198      76

Long-term liabilities of discontinued operations

     —        1,397
             

Total Liabilities

     17,008      17,358
             

Stockholders’ Equity

     30,002      30,022
             

Total Liabilities and Stockholders’ Equity

   $ 47,010    $ 47,380
             


NATURAL ALTERNATIVES INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME

(In thousands, except per share data)

(Unaudited)

 

     Three Months Ended
June 30,
          For The Year Ended
June 30,
       
     2008           2007           2008           2007        
NET SALES    $ 21,547     100.0 %   $ 21,365     100.0 %   $ 81,755     100.0 %   $ 86,566     100.0 %

Cost of goods sold

     18,316     85.0 %     17,952     84.0 %     68,843     84.2 %     70,844     81.8 %
                                                        

Gross profit

     3,231     15.0 %     3,413     16.0 %     12,912     15.8 %     15,722     18.2 %

Selling, general & administrative expenses

     2,950     13.7 %     2,773     13.0 %     11,838     14.5 %     11,956     13.8 %
                                        

OPERATING INCOME FROM CONTINUING
OPERATIONS

     281     1.3 %     640     3.0 %     1,074     1.3 %     3,766     4.4 %

Other income (expense), net

     (44 )   -0.2 %     47     0.2 %     102     0.1 %     (320 )   -0.4 %
                                                        

INCOME FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES

     237     1.1 %     687     3.2 %     1,176     1.4 %     3,446     4.0 %

Provision for income taxes

     240         357         264         739    
                                        

(LOSS) INCOME FROM CONTINUING OPERATIONS

     (3 )   0.0 %     330     1.5 %     912     1.1 %     2,707     3.1 %

LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX

     (165 )   -0.8 %     (6,925 )   -32.4 %     (1,283 )   -1.6 %     (7,992 )   -9.2 %
                                        
NET LOSS    $ (168 )     $ (6,595 )     $ (371 )     $ (5,285 )  
                                        

NET INCOME (LOSS) PER COMMON SHARE:

                

Basic:

                

Continuing Operations

   $ (0.00 )     $ 0.05       $ 0.13       $ 0.40    

Discontinued Operations

   $ (0.02 )     $ (1.01 )     $ (0.18 )     $ (1.17 )  
                                        

Net Loss

   $ (0.02 )     $ (0.96 )     $ (0.05 )     $ (0.77 )  
                                        

Diluted:

                

Continuing Operations

   $ (0.00 )     $ 0.04       $ 0.13       $ 0.37    

Discontinued Operations

   $ (0.02 )     $ (0.97 )     $ (0.18 )     $ (1.11 )  
                                        

Net Loss

   $ (0.02 )     $ (0.93 )     $ (0.05 )     $ (0.74 )  
                                        

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:

                

Basic

     7,023         6,898         6,983         6,836    
                                        

Diluted

     7,023         7,124         7,038         7,176