NUTRACEUTICAL INT'L CORP. PARK CITY, Utah, April 28, 2016 /PRNewswire/ -- Nutraceutical International Corporation (NASDAQ: NUTR) today reported results for the fiscal 2016 second quarter ended March 31, 2016. Net sales for the fiscal 2016 second quarter were $59.5 million, compared to $55.4 million for the same quarter of fiscal 2015. For the second quarter of fiscal 2016, net income was $4.6 million, or $0.49 diluted earnings per share, compared to net income of $4.1 million, or $0.43 diluted earnings per share, for the same quarter of fiscal 2015.
Net sales for the six months ended March 31, 2016 were $115.5 million compared to $108.4 million for the same period of fiscal 2015. For the six months ended March 31, 2016, net income was $8.9 million, or $0.94 diluted earnings per share, compared to net income of $7.4 million, or $0.77 diluted earnings per share, for the same period of fiscal 2015.
Operating cash flow for the six months ended March 31, 2016 was $17.3 million, compared to $11.2 million for the same period of fiscal 2015. The operating cash flow for the six months ended March 31, 2016, combined with net borrowings of $16.0 million, was primarily used to invest $26.2 million in acquisitions of natural product businesses, $4.0 million in purchases of property, plant and equipment and $3.6 million in purchases of common stock for treasury.
Bill Gay, chairman and chief executive officer, commented, "Fiscal 2016 second quarter net sales grew by 7.4%, Adjusted EBITDA increased by $1.1M, or 10.8%, and we added $0.06 per share to diluted EPS. Management is pleased with the overall growth and direction of our business and with the gains generated by recent acquisitions. We are hopeful the softness in certain areas of our international business will improve later in the year. Management now believes that consolidation synergies from the October 2015 Dynamic Health acquisition will not become fully realized until later in calendar 2017. Our February 2016 acquisition of Aubrey Organics in Tampa, Florida will enable us to consolidate certain branded offices and manufacturing operations for our personal care business. Both of these new businesses expand our current branded portfolio of products with many unique offerings for our health and natural food store customers. We are excited about the long-term growth potential these two businesses provide to our company."
Mr. Gay continued, "Our operating cash flow and banking relationships provide a strong foundation for future acquisitions, investments in property and equipment as well as stock repurchases. The competitive and regulatory environment of our industry requires us to continually invest in updating and improving our manufacturing equipment and facilities. Management remains focused on reducing costs and improving margins in all areas of our business through process and technology innovation as well as facility integration and consolidation. Additionally, through the process of reviewing and completing acquisitions, we are continually evaluating opportunities to leverage lower-cost markets to operate parts of our business and further reduce operating costs. We thank our customers, employees, and stockholders for the support of our long-term business strategy."
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 provide 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®, Dynamic Health(TM), Nature's Life®, LifeTime®, Natural Balance®, NaturalCare®, Health from the Sun®, Pioneer®, Nutra BioGenesis(TM), Life-flo®, Organix South®, Heritage Store® and Monarch Nutraceuticals(TM).
We own neighborhood natural food markets, which operate under the trade names The Real Food Company(TM), Thom's Natural Foods(TM), Cornucopia Community Market(TM) and Granola's(TM). We also own health food stores, which operate under various trade names, including Fresh Vitamins(TM) and Peachtree Natural Foods®.
We manufacture and/or distribute one of the broadest branded product lines in the industry, with approximately 7,500 SKUs, including approximately 750 SKUs exclusively 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 including adverse determinations by regulators; (ii) unavailability of desirable acquisitions, inability to complete them or inability to integrate 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, including system interruptions and security/cybersecurity breaches; (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).
NUTRACEUTICAL INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited; dollars in thousands)
March 31, September 30,
--------- -------------
2016 2015
Assets
Current
assets,
net $89,814 $86,215
Property,
plant and
equipment,
net 83,460 77,645
Goodwill 30,925 24,384
Other non-
current
assets,
net 30,316 24,205
------ ------
$234,515 $212,449
-------- --------
Liabilities and Stockholders'
Equity
Current
liabilities $20,712 $20,528
Long-term
liabilities 47,684 31,674
Stockholders'
equity 166,119 160,247
$234,515 $212,449
-------- --------
NUTRACEUTICAL INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited; dollars in thousands, except per share data)
Three months ended March 31, Six months ended March 31,
---------------------------- --------------------------
2016 2015 2016 2015
Net sales $59,492 $55,404 $115,451 $108,448
Cost of sales 29,163 28,149 57,014 55,338
------ ------ ------ ------
Gross profit 30,329 27,255 58,437 53,110
Operating expenses
Selling, general and
administrative 21,779 19,789 42,121 39,343
Amortization of intangible
assets 999 728 1,980 1,460
--- --- ----- -----
Income from operations 7,551 6,738 14,336 12,307
Interest and other expense, net 322 273 596 570
--- --- --- ---
Income before provision for
income taxes 7,229 6,465 13,740 11,737
Provision for income taxes 2,611 2,369 4,881 4,290
----- ----- ----- -----
Net income $4,618 $4,096 $8,859 $7,447
------ ------ ------ ------
Net income per common share
Basic $0.49 $0.43 $0.94 $0.77
Diluted 0.49 0.43 0.94 0.77
Weighted average common shares outstanding
Basic 9,401,972 9,622,051 9,430,878 9,637,753
Diluted 9,401,972 9,626,925 9,430,878 9,643,637
NUTRACEUTICAL INTERNATIONAL CORPORATION
ADJUSTED EBITDA SCHEDULE
(unaudited; dollars in thousands)
Three months ended March 31, Six months ended March 31,
---------------------------- --------------------------
2016 2015 2016 2015
Net income $4,618 $4,096 $8,859 $7,447
Provision for
income taxes 2,611 2,369 4,881 4,290
Interest and other
expense, net (1) 322 273 596 570
Depreciation and
amortization 3,538 3,268 7,020 6,507
----- ----- ----- -----
Adjusted EBITDA $11,089 $10,006 $21,356 $18,814
------- ------- ------- -------
(1) Includes amortization of deferred financing fees.
Non-GAAP Financial Measures
Adjusted EBITDA (a non-GAAP
measure) is defined in our
performance measures as earnings
before net interest and other
expense, taxes, depreciation,
amortization and goodwill and
intangible asset impairments. 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.
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SOURCE Nutraceutical International Corporation
